Maverick Gaming Files For Summary Judgment In Washington State Compact Litigation

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On August 12, 2022, Maverick Gaming filed a motion for summary judgment in its litigation against the federal government. The dispute regards new gaming compacts in Washington State.

In its corner, Maverick has former Solicitor General Ted Olson, an important figure in gambling law. Olson defeated the sports leagues in their unconstitutional quest to keep sports betting confined to Nevada.

Maverick’s motion comes a little more than a week after the Shoalwater Bay Tribe filed a motion to intervene on a limited basis. The tribe seeks to intervene because it claims that the federal government defendants will not adequately represent its interests. This is reminiscent of what’s happening with litigation over Florida’s new gaming compact, which is on a slightly advanced timeline in the D.C. Court of Appeals.

The motion to intervene makes no mention of this other litigation. However, the argument is similar to that which the Seminole Tribe of Florida is making in its appeal. The D.C. District Court had ruled that the Seminoles were not a necessary party to the case.

If granted, the motion for summary judgment in the Washington litigation could spell the end of the first phase of litigation. This seems like a long shot, however. Moreover, this is a case with the potential to disrupt the very framework of the Indian Gaming Regulatory Act (IGRA). No matter what happens, this will be just the first step on an inevitably long litigation path.

Refresher on the Maverick Gaming litigation

Maverick Gaming filed its lawsuit against the Department of the Interior and various state officials after Washington entered into new gaming compacts with tribes in the state. The new compacts allowed the tribes in question the ability to offer sports betting at their brick-and-mortar facilities.

Maverick Gaming, a multi-state operator of non-tribal cardrooms, objected to the new compacts. It argued that the agreements put the company at a further disadvantage and award the tribes a “monopoly over an entire sector of its economy.”

This came after sports betting in Florida had been derailed by a federal judge who ruled that IGRA does not permit the type of wagering scheme contemplated by the Compact, despite the State and the Tribe being in agreement. There are still many unresolved questions regarding the IGRA and new gambling verticals like sports betting and iGaming.

What is Summary Judgment?

A summary judgment takes place when the court enters a judgment for one party without completing a trial. In order to prevail on a motion for summary judgment, a moving party must show two things in federal court.

  1. There is no genuine dispute around the material facts of the case, and
  2. The moving party is entitled to judgment as a matter of law.

If a party is able to demonstrate these two things, the court will enter judgment for them. In the event that the party may be able to do so for some of the issues involved but not others, the court may enter partial summary judgment. The trial will then proceed for the remaining issues.

What is Maverick Arguing?

Maverick’s motion makes three arguments for why it should receive a summary judgment.  Should the Washington State-based federal court grant any of the three, it would likely send the case to the Court of Appeals immediately.

The first argument is that the tribal gaming monopoly in Washington State violates the Equal Protection Clause of the Constitution. Maverick claims it creates a race-based preference system. Of note is that Maverick:

acknowledges that its equal-protection argument is currently foreclosed in this Circuit by the Ninth Circuit’s decision in Artichoke Joe’s Cal. Grand Casino v. Norton, but it respectfully preserves its argument for further review (internal citations removed).

Maverick argues that the eligibility for gaming opportunities based on tribal membership is a race-based classification that is subject to strict scrutiny. Strict scrutiny is a legal term referring to the most exacting standards for testing the constitutionality of a law. It would require the government to show that the law was passed to further a compelling government interest and that the law was narrowly tailored to achieve that particular interest.

Maverick then goes on to argue that the Washington Compacts would not survive a strict scrutiny review.

IGRA Does Not Allow Tribal Monopolies?

The second argument Maverick makes is that IGRA does not permit the awarding of tribal monopolies over Class III gaming. The crux of Maverick’s argument is the second prong of whether Class III gaming is permitted. The second prong states:

located in a State that permits such gaming for any purpose by any person, organization, or entity…

The gaming operator argues that this prong was meant to create “parity” between tribal and non-tribal gaming operations in a state it was not meant to award monopolies.

However, once again, Plaintiff acknowledges that this issue is foreclosed on in the circuit by the Artichoke Joe’s decision from 2003.

All Aboard the Anti-Commandeering Train

Maverick’s final argument is that IGRA violates the anti-commandeering principle of the Constitution. You may recall this was Ted Olson’s bread and butter in New Jersey‘s efforts to strike down the Professional and Amateur Sports Protection Act.

Most notably, the anti-commandeering principle prohibits the federal government from issuing orders to state legislatures about what they must or must not do. The motion argues that requiring a state government to enter into negotiations with tribes who wish compact violates the anti-commandeering clause.

The brief argues that this would render the compacts invalid. Indeed, it would likely affect all compacts, at least those in the Ninth Circuit. However, it is not clear that these plaintiffs have standing to bring such a claim.

Why is the Maverick Gaming Case So Important?

The brief’s final argument concludes by stating:

All of IGRA therefore must fall along with the state-negotiation requirement. And because that mandate is not severable from the remainder of the Act, none of IGRA’s provisions can stand, and the Secretary lacked any authority to approve the Compact Amendments.

This is a pretty significant consequence.

A ruling in Maverick Gaming’s favor could unravel the entirety of the tribal gaming regulatory scheme in the US. A large portion of gambling nationwide hinges on the validity of compacts made under the IGRA.

An oral argument on the motion has been requested for November 4, 2022. We should, however, have a hearing on the partial intervention by the Shoalwater Bay Tribe in the coming week or two.

 

About the Author

John Holden

John Holden is a writer at Bonus, focused on legal and regulatory issues in the gambling industry. He is a full-time academic but has been writing for a number of gaming publications since 2018. He is the author of more than 50 academic publications and hundreds of mainstream articles on the regulation of the gaming industry.

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