California

Latest California Online Poker Bill Introduced, PokerStars Still Targeted

The latest introduction of a California online poker bill scheduled for consideration during the state’s 2015 legislative session promises to reignite an ongoing factional battle over interested parties.  The newest measure, California Assembly Bill 9 (AB-9), has been introduced by Assemblyman Mike Gatto (D-Los Angeles) and is the latest iteration of a partisan proposal championed by a 12-tribe consortium that seeks to block the possible entry of international online poker giant PokerStars as a software partner of other likely online-poker providers in the state, should the game be formally approved and regulated.

CaliforniaGatto’s AB-9 measure, euphemistically titled the “Internet Poker Consumer Protection Act of 2015,” is instead, as with its direct predecessors, a bill that actually has little to do with protecting consumers but is instead about protecting the interests of the dozen large tribal nations who have drafted several highly similar versions of a would-be California online-poker bill in recent years.

The latest bill, as illustrated in a PDF created by OnlinePokerReport’s Chris Grove, contains large swaths of legislative language copied directly from a so-called “Joint Letter and Unified Language” version that combined California state Senate and Assemble versions of online-poker legislation that was up for consideration in 2014.  Both versions of the bills, SB 1366 and AB 2291 (sponsored by Sen. Lou Correa and Assemblyman Reggie Jones-Sawyer, respectively, were also created by the same 12-tribe consortium, which formerly numbered 13 tribes until the recent defection of the San Manuel Tribe of Mission Indians, who now support the acceptance of PokerStars in California and would likely use the company’s software if approved via legislation.

The 12 tribes continuing to seek to block PokerStars through the enactment of so-called “bad actor” language are the Agua Caliente Band of Caliente Indians, the Barona Band of Mission Indians, the Cachil Dehe Band of Wintun Indians, the Lytton Band of Pomo Indians, the Pala Band of Mission Indians, the Paskenta Band of Nomlaki Indians, the Pechanga Band of Luiseño Indians, the Rincon Band of Luiseño Indians, the Sycuan Band of Kumeyaay Indians, the United Auburn Indian Community, the Viejas Band of Kumeyaay Indians and the Yoche Dehe Wintun Nation.

The Palas, Pechangas, Agua Calientes and Rincons are believed to be the primary forces behind the legislation, this despite ongoing controversy over the recent approval in New Jersey of the Pala-affiliated Pala Interactive software entity and that company’s CEO, James Ryan.

As with earlier versions of the bills pushed by the Pala/Pechanga coalition, the supposed bad-actor attack begins by invoking the activation date of the federal-level 2006 Unlawful Internet Gambling Enforcement Act (UIGEA), with an implied declaration that US-facing firms in operation after that date are presumed illegal:

In granting licenses to engage in intrastate Internet poker, the state also has a substantial interest in carefully assessing the suitability of any entity or person who seeks to operate Internet poker games in the state. In order to protect the integrity of, and promote public confidence in, intrastate Internet poker, the Legislature finds that licenses should not be granted to those entities and persons who knowingly engaged in unlawful Internet gaming after December 31, 2006. In addition, the Legislature finds that the use for intrastate Internet poker of brand names, trademarks, customer lists, software, and other data associated with, or developed or used in connection with, unlawful Internet gaming after December 31, 2006, is likely to undermine public confidence in intrastate Internet poker and to be inconsistent with the purpose of this chapter to protect the people of California by  permitting regulated intrastate Internet poker that has no connection to previous unlawful Internet gaming activity. In the Legislature’s judgment, a knowing decision to purchase or otherwise acquire that data for use in connection with Internet poker in the state bears directly on the applicant’s suitability and must be considered in any determination whether to license that applicant under this chapter.

In the latest iteration, that’s been coupled with more recent text designed to bar the assets of PokerStars, following the company’s sale earlier in 2014 to Canada-based Amaya Gaming.  Here’s that declaration, found in the bill’s definitions:

(i) “Covered asset” means any brand or business name, including any derivative brand name with the same or similar wording, or any trade or service mark, software, technology, operational system, customer information, or other data acquired, derived, or developed directly or indirectly from, or associated with, any operation that has accepted a bet or engaged in a financial transaction related to that bet from any person in the United States on any form of Internet gaming after December 31, 2006, except when permitted under federal law and laws of the state where the player was located.

And, in reference to another possible entry point the Palas and Pechangas would like to see blocked:

(J) The disclosure of the source of assets, including any covered asset, intended to be used by the applicant or licensee or on the applicant’s or licensee’s behalf, including, but not limited to, software and marketing information or data.

The bill also includes a non-severability clause designed to force all such matters to be dealt with as a unified whole: “The bill would provide that specified provisions are not severable.”

As with previous interations of the online-poker bill, AB-9 has been tagged as an “urgency” statute and would require two-thirds approval of both the state’s Assembly and Senate to advance.  It is likely that this version of the bill, as with previous attempts, will face significant opposition.

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