California Proposes Sweeping Changes to Cardroom Regulations

In a bid to settle a contentious and long-standing dispute between California Indian tribes and cardrooms, the California Bureau of Gambling Control (BGC) has introduced proposed regulations that could significantly alter the landscape of the state’s gambling industry. 

California Cardrooms to Undergo Major Changes as Blackjack Faces Ban

Under the proposed rules, any form of blackjack, including player-banked versions, would be expressly prohibited in cardrooms across the state. The regulations also mandate that player-banked games rotate the dealer position at least twice every 40 minutes, a change meant to address concerns raised by tribal communities regarding the rotation of the bank between third-party proposition players and regular players at the table.

Although the regulations prohibit traditional blackjack, they do allow for a modified version of the game where players aim to get closest to a target point, similar to 21. However, unlike blackjack, players cannot exceed the target point, and the winner is determined based on proximity to the target, regardless of whether the player’s card total exceeds the specified number. These modified games cannot use the term “blackjack” or incorporate the number 21 in their names.

The proposed changes come in response to a protracted dispute over house-banked games between California Indian tribes and cardrooms. Tribal communities have exclusive rights to offer house-banked games in the state, a privilege that excludes other gambling establishments from offering games involving a “bank” or “percentage,” specifically referencing the game of “21.”

BGC Seeks Public Feedback Amidst Brewing Legal Battle between Cardrooms and Tribes

The BGC has invited public feedback on the proposed regulations until October 26. While the fate of these regulations remains uncertain, it is evident that the proposed changes could have a profound impact on California’s gambling landscape, leading to further debates and discussions among stakeholders in the coming months.

At the same time, in July, the California Assembly Judiciary Committee passed a bill, SB 549, allowing Indian tribes to sue cardrooms, aiming to resolve a longstanding conflict. California’s cardrooms use third-party proposition players (TPPPs) who act as banks in games. The bill enables tribes to file a one-time lawsuit, asserting that cardrooms’ games breach the state constitution. 

Tribes have a three-month window starting January 1, 2024, to sue. The move comes after years of dispute, with tribes claiming cardrooms’ banked games infringe on tribal casinos’ exclusivity. Cardrooms opposed the bill, arguing the approved games should not be subject to lawsuits, and that they cannot countersue competitors under this arrangement.