California Card Games

Hearing Looms in California Cardroom Banked-Games Battle

The ongoing legal controversy involving California cardrooms’ ability to offer certain house-banked card games is on its way to a planned December 18, 2019 hearing in Sacramento to debate proposed new rules that will hinder the rooms’ ability to offer these games.

The proposed rules changes, recently published by California’s Bureau of Gambling Control, affect all third-party proposition player (TPPP) games, which constitute a decent percentage of what’s offered in many of California’s 72 licensed cardrooms. Using a workaround through which the designated TPPP at each table pays a rate to serve as the bank, these non-poker games still generate revenue for the rooms despite the dealer/room not being the bank in a given hand.

The new rules, heavily lobbied for by California’s tribal casinos, seek to close that loophole in the hopes of driving the player traffic from those games away from the cardrooms and to the casinos themselves, which have no restrictions regarding house-banked card games. It’s the latest monopolistic push from the tribal casinos, which have gone after online-poker initiatives, these cardrooms, California’s pari-mutuel industry and more in recent years. Yet another ongoing push involves a hard-line tribal coalition’s efforts to make legalized sports betting in the state the exclusive purview of the tribal casinos.

Amid these legislative battles comes this latest step in the TPPP slugfest. Titled “Rotation of player-dealer position
regulations workshop notice and concept text”, the December 18 hearing will open debate on the proposed rules, which will likely shut down the TPPP games. Here’s an excerpt from the proposed rules clarifications:

Section 20:XX. Games with a Player-Dealer Position; Rotation; Operation of Game.

(a) A game that features a player-dealer position shall provide in its rules that; following:

(1) The player-dealer position may only be occupied by a person seated at the table, and shall continuously and systematically rotate to another person after every two consecutive rounds of play. The game rules shall specify the means by which the player-dealer position is selected at the opening of a new game, and upon rotation of the player-dealer position to the next person.

(2) Any person who refuses to accept the player-dealer position when it is their turn, shall be excluded from the the play of the game. …

(3) If no one accepts the player-dealer position from the person who last occupied it, the game shall stop, and no further play shall be allowed or commenced unless and until another person accepts the player-dealer position. …

These and more clarifications are intended to bar the TPPP practices, and since these preliminary rules were proposed by the state, they have the inside track to being passed into law, to the detriment of the cardrooms. This will likely result in a contraction in California’s cardroom market, though the exact extent of lost jobs and possible room closures remains unclear.

Speaking to the LA Times, the California Gaming Association, which represents many of the state’s cardrooms, offered this: “If these regulations were adopted as proposed, they would kill the card room industry and devastate dozens of communities and thousands of working California families across the state. This proposal is a clear attack on the card room industry and a message that the bureau is intent on eliminating this lawful $5.6-billion industry and putting 32,000 Californians out of work.”

There’s certainly some hyperbole in that statement; it’s unlikely the new rules will wipe the likes of Commerce or the Bike, among the largest of the state’s rooms, from the business scene. Still, the looming enactment of the rules spells the possible end of the TPPP situation in Caifornia.

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