With a hearing on Adam Gray’s California Assembly Bill 2863 looming this week, it has appeared that after years of squabbling, the various stakeholders were finally getting close to an agreement that would make online poker legal in the state. That may still be true, but last week, a couple amendments were added to the bill that illustrate that a group of hard line tribes are still working to get their way on a “bad actor” clause.
The bill, which is considered “compromise” legislation and seems to have a better chance to advance than other bills have in the past, now contains two clauses that kind of, sort of, bring back the bad actor portion of previous bills.
Clause 1:
The bill would become operative when criteria are established by statute addressing involvement in Internet betting prior to the state’s authorization of Internet poker pursuant to its provisions.
Clause 2:
The act that added this subparagraph shall not become operative until criteria are established by statute to address involvement in Internet betting prior to the state’s authorization of Internet poker pursuant to this chapter.
As you can see, these clauses don’t specifically say that online poker operators who offered games to U.S. players before the UIGEA passed in 2006 are prohibited from being granted licenses, but they do specifically instruct the gaming commission to look at “involvement in Internet betting prior to the state’s authorization of Internet poker” when evaluating licensing applications.
Without these amendments, gaming regulators could still consider an operators offerings prior to the UIGEA or Black Friday, but was not explicitly instructed to do so. This is clearly a shot at PokerStars, which, along with a coalition of a number of tribes and card rooms, had expressed its support for the bill prior to the amendments. PokerStars is the 800-pound gorilla in the online poker industry and some tribes see that the site’s involvement in online poker as a huge threat.
Those tribes – the Agua Caliente Band of Cahuilla Indians, the Barona Band of Mission Indians, the Lytton Band of Pomo Indians, the Pechanga Band of Luiseño Indians, the Viejas Band of Kumeyaay Indians, and the Yocha Dehe Wintun Nation – wrote their own letter to Assemblyman Gray to indirectly urge him to reconsider the bad actor clause. While it doesn’t specifically say, “We want a bad actor clause,” it does talk about “suitability language,” which is essentially those tribes’ way of compromising:
We also appreciate your commitment to work with us to draft meaningful Suitability Standards for Prospective Applicants. However, to proceed with the suitability language in your current Draft – which our Coalition would otherwise vigorously oppose from the outset – we could not agree to the process you outlined as it would place us at an unfair disadvantage in the process given your request for neutrality. As we agreed to do concerning the operator fees, we believe your bill at introduction should, as a matter of fairness, contain truly impartial language on Suitability Standards for Prospective Applicants so as not to prejudice our position on this very significant – if not pivotal – aspect of the bill. We would be happy to have our staff work with your staff on such language.
Therefore, if impartial language is inserted into the bill when introduced, we commit to engaging in good-faith negotiations with you on Suitability Standards for Prospective Applicants to resolve this outstanding issue before the bill is brought to the Assembly Floor for a vote.
The letter apparently worked. The hearing on the poker bill is scheduled for Wednesday, April 27th.
