Martin Lycka, Entain Plc’s Senior Vice President for American Regulatory Affairs and Responsible Gambling, takes a look at the origins of tribal gambling law and how some momentous decisions have triggered a gaming revolution on tribal soil.
The online gambling industry is a universe inhabited by people from all walks of life. It welcomes sports aficionados, marketing gurus, tech brainiacs, entrepreneurial mavericks as well as law nerds. I was perhaps a law nerd once; spending long evenings rummaging through statutory books and lists of court precedents was a particular passion of mine.
Yet, the rather convoluted nature of the industry regulation as well as the industry’s focus on practical reality has shown me time and time again that to be at least a half decent gambling attorney much more is required than being able to memorize wise words uttered by esteemed judges.
And so, I have left my study and entered the manic world of online gambling marked by constant change at the speed of light. I have learnt that despite popular belief to the contrary, there is method to this whole madness and being pragmatic is arguably the most efficient way of helping to steer the online gambling ship.
What feels like many moons ago now the online gambling ship was only allowed to anchor in a select few European harbours; steering it westwards towards the American shores would have meant getting enmeshed in the nets of PASPA and other pieces of pre-digital legislation. And then the Supreme Court decided to tear down all the no entry signs; the ship has landed, and the rest is history, or rather the biggest seismic shock to the industry universe.
There is however another legal history that has been evolving in parallel to PASPA and its eventual revocation; and that is the history of North American tribal gaming. As it goes, the story starts with a property tax bill received by a married couple, by the name of Bryan, who lived in a mobile home on Indian lands in northern Minnesota.
The Bryans had never received a property tax bill from the local authorities, in this case the Itasca County, before; feeling aggrieved they took the County to court over it. Having successively lost at all lower instances, the Bryans displaying their grit and determination, not dissimilar to the heroes of the PASPA revocation battle, obtained a Writ of Certiorari from the Supreme Court.
The case was heard, and the Court concluded that states have no authority to tax natives on their reservations. Crucially for our gambling story, the Court went beyond the specifics of the Bryans’ claim and decided that states have no authority to regulate Native activities on tribal lands either. Tribal sovereignty over gaming from within their land has been subsequently upheld in cases launched by the Californian Cabazon Band as well as the Florida Seminoles.
These momentous decisions have triggered the tribal gaming revolution, resulting in over 200 tribes being engaged in offering one form of gambling or another on Indian lands located in the likes of Arizona, California, Connecticut, Florida, Minnesota, New York, or Oklahoma. The revolution has found its legislative expression in the 1988 Indian Gaming Regulatory Act, or IGRA for short.
The Act has kept tribal sovereignty over gambling on Indian lands while subjecting some of its key aspects to compacts between the tribes and their state. In addition, all such compacts require a sign off by the US Department of Interior for Indian Affairs, either by means of explicit approval or by taking no action in 45 days of receipt of any such compact negotiated on the state level.
Similarly, in Canada, the Mohawk Council of Kahnawake asserted its rights over gambling from within its lands and in 1996 introduced its gambling regulation and continues in force till the present day, something the Ontario authorities will arguably have to contend with when getting their anticipated iGaming regulation over the wire.
The advent of sports betting to the United State, especially in its mobile form, has woven the PASPA and tribal gaming legal histories into one and most certainly got the juices of all the law nerds amongst us flowing.
In this respect, the critical part of IGRA provides that the tribes have a right to offer gambling categories that have been permitted by the state in which they are located; this is exactly where sports betting comes to the picture. As part of the nationwide sports betting expansion tribes in Arizona, Connecticut, New York, or South Dakota have renegotiated their compacts to allow for at least some forms of sports betting.
The two states where the raging debate about the interplay between mobile and other forms of sports betting and tribal gaming comes to the fore most prominently are Florida and California.
The Governor of Florida and the Seminole Tribe have recently entered into a 30 year compact that grants the Seminoles exclusive rights to offer mobile sports betting in the state; with the key legal principle behind the compact being that bets will be made on Indian land because the servers accepting them are located there.
This rather novel approach has already triggered litigation in Florida courts by proponents of the historically applicable legal precept to the effect that for a bet to be deemed placed on tribal land both the person placing the bet and the casino must be on it. As the federal authorities have most recently signed the Florida compact off its fate will most likely be decided in courts unless the recent efforts of Representatives Correa and Katko to clarify the definition of online tribal gaming under IGRA by means of federal legislation shall prosper.
At the same time, in the Golden state, the tribes have made a play for control of the future regulated sports betting market by launching a ballot initiative that would restrict wagering to their brick and mortar casinos and a handful of racetracks. The word on the street is that to counter this move the private gambling industry may consider launching its own ballot for mobile sports wagering. Whatever may happen the showdown time will come in November next year.
The bottom line is that even the hype-y world of North American sports betting and iGaming expansion is showing quite some love to people who happen to be infatuated with law books and court precedents; and brushing off some of the rather tedious legal theories might eventually come in handy.