California Cardrooms Send a Stern Signal to Lawmakers Who Vote Against Them

California cardrooms spent several million dollars attacking legislators who voted against their interests after the legislation had been passed. It’s an unusual tactic to attack after the fact, but the cardrooms want lawmakers to know there is a price to be paid by opposing their interests.

Critical Bill

Senate Bill 549, also known as the Tribal Nations Access to Justice Act, was signed into law in September and will go into effect on January 1, 2025. The cardroom consortium took aim at those lawmakers who backed the bill that will allow tribes to sue them for offering blackjack, pai gow poker, and other casino table games, which are supposed to be the exclusive province of the tribal gaming community in the Golden State.

The cardrooms are not allowed to be the bank in those games but can take a rake of each hand, much like poker. However, the lines are often blurred between what the 84 California cardrooms can and cannot do, such as hiring third-party companies to act as the bank instead of making one of the customers act in that capacity. The tribes have insisted that these third-party companies are the de facto “bank” and will now be able to put those arguments to the test in a legal forum.

Impacts on Local Governments

Once the New Year comes, tribes will be able to sue the cardrooms, and should they be successful, it would be a mortal blow to their bottom lines. But local governments would also suffer as local taxes are collected from the cardrooms’ profits on casino games, and without that revenue stream, public services could suffer, and layoffs to police, fire, and first responders could be the result.

The legal costs could also be staggering, and the California Gaming Association estimates Senate Bill 549 could cost the cardroom industry approximately 32,000 jobs.

Hack Attack

Whether it is a newly-minted political firebrand or a haggard political hack who has outlived their usefulness, California cardrooms will make no distinction in attacking those who vote against their financial and legislative interests.

The cardrooms aired their grievances when they spent $3 million on attack ads against four legislators with whom they were at odds. It is unusual to spend that kind of money after the legislation has been signed, but the cardrooms were clearly sending a message.

“Any time you have a group essentially announcing to the world that they are going to do vengeance spending, it does cause lawmakers to pay attention,” said former Democratic Assemblymember Mike Gatto.

Of the four legislators that were in the cardrooms’ crosshairs, three lost their races while another, Republican Laurie Davies, was the only one to survive her political race despite the $1.3 million spent by the cardrooms against her. Nevertheless, it was a close call as Davies won by less than 4000 votes, in which over 230,500 votes were cast.

Questionable Funds Allocation

But with potential lawsuits coming, some wonder whether that $3 million would be better used as a war chest for the legal challenges to come. After all, Senate Bill 549 had already been passed, and the elections came afterward; therefore, the money spent was based sheerly on settling grudges.

One of the legislators who was the target of the cardroom’s political vengeance was Democratic Senator Josh Newman, who asked, “The question really is: If you shut the barn door after the horse is out, who are you really punishing?”