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California Obtains TRO Against Santa Ysabel Online Bingo

Attorneys for the state of California were successful on Friday in obtaining a temporary restraining order against the Iipay Nation of Santa Ysabel Indians, which last month launched a real-money online bingo site and had announced plans for a real-money online poker operation as well.

The state’s motion was granted by the presiding judge in the case, US District Judge Anthony J. Battaglia of the Southern District of California.  The TRO granted on Friday means that the tribe will likely be forced to suspend the operation of its Desert Rose Bingo site, which went live on November 3rd.  At last check, the Santa Ysabels’ desertrosebingo.com site remained operational, and the tribe had yet to issue a formal response regarding Battaglia’s ruling.

desert-rose-bingo-logoIn granting the state’s request for a temporary restraining order, Battaglia struck down the main arguments raised by the tribe in a recent countering motion.  Among the primary points of contention are that tribal sovereignty rights bar the state of California from taking action against gaming that was defined as Class II — a category of gaming that includes both bingo and poker — and is thus not subject to tribe-state compact negotiations under IGRA (the Indian Gaming Regulatory Act), the federal statute that governs the offering of tribal gaming within the United States and has been the impetus for the founding, nationwide, of hundreds of tribal casinos.

Battaglia was forced to deeply examine the offerings of the Iipay Nation’s bingo site, and in making his ruling, determined that as defined by IGRA itself, the online bingo offered by the tribe was not Class II gaming, but Class III gaming.

The nature of Battaglia’s basis for granting the TRO is important because it also implies that the Santa Ysabels are not likely to be able to offer online poker for real money, either, pending regulatory approval by state or federal authorities.  The reason, as Battaglia excerpted from IGRA’s statutory definitions, is that the form that online bingo (and presumably online bingo) takes in being translated into an online offering makes the game a “facsimile” of real bingo (or poker).

IGRA allows for certain types of electronic enhancements to game play, but carries a strict exception for the usage of electronic systems that translate the game into a facsimile of its original form; IGRA declares that such a game is not Class II but Class III, and is thus subject to formal tribal-state regulation and negotiation.

Here’s the segment of Battaglia’s ruling where he clarifies this:

Determining whether the Compact was breached depends on whether the bingo is considered a Class II or Class III game. Regarding the scope of Class III gaming, the Compact provides that the Tribe is authorized to operate the following gaming activities: (a) gaming devices; (b) any banking or percentage card game, (c) “[a]ny devices or games that are authorized under state law to the California State Lottery, provided that the [Tribe] will not offer such games through use of the Internet unless others in the state are permitted to do so under state and federal law.” 

. . .

Class II games may use technological aids, but if the technology is deemed an electronic facsimile, the game is elevated to Class III. … (“IGRA, however, explicitly excludes from Class II gaming [electronic or electromechanical facsimiles].”) … (“Regarding the use of technology, the distinction between class II and class III, according to IGRA, is that the use of ‘aids’ is permitted for certain class II games; the use of “facsimiles” is permitted only in class III games and only when the Indians have entered into a Tribal-State compact.”).

… (“[A]n ‘electronic aid’ to a class II game can be viewed as a device that offers some sort of communications technology to permit broader participation in the basic game being played, as when a bingo game is televised to several rooms or locations.”)

Battaglia cited a handful of previous court decisions that attempted to hone in on exactly when an electronic game becomes a facsimile, and thus Class III gaming, and determined that the Desert Rose offering. despite being defined as using “proxies” and receiving tacit approval — or at least no letter of comdemnation — from the National Indian Gaming Commission (NIGC), was well beyond the boundary.

Battaglia wrote:

In light of all of the above, the Court is convinced that the internet gaming provided here is Class III. This was bolstered by the presentation of the game at the hearing, at which it became apparent that, as the State represented, the player’s participation is limited to electing the amount to bet and the number of cards to play.

Battaglia continued by ordering the state and Iipay Nation officials to meet to discuss the setting of an order to show case hearing within the next two weeks.  Battaglia appears poised to follow the TRO by issuing a temporary injunction against the tribe, which would force the Santa Ysabels into a lengthy and uphill legal battle if they wish to continue offering their online gambling services to Californians.

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