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California and the West

Judge Threatens Ban on Slots at Indian Casinos

Gaming: Jurist says tribes must sign compacts with state or he will bar devices in which players bet against house.

July 21, 1998|DAVID ROSENZWEIG | TIMES STAFF WRITER

A federal judge announced Monday that he intends to bar slot machines and other Nevada-style gambling at nine Indian casinos in Southern California on Sept. 15 unless the tribes sign compacts with the state.

The tentative ruling by U.S. District Judge J. Spencer Letts caught lawyers for the Indian tribes by surprise. They complained that their due process rights were being abridged and called for further hearings on the case.

If the judge's ruling becomes final as scheduled, it is certain to be appealed.

In another blow to the tribes, Letts said Monday that he found no evidence to support their charges that the state of California has been engaged in bad faith negotiations over the compacts.

That is at the heart of their continuing feud with Gov. Pete Wilson, who has refused to negotiate with them until they cease all gambling activities that the governor considers illegal.

Under the federal Indian Gaming Regulatory Act of 1988, tribes must negotiate compacts with the states in which they are located if they want to offer slots or other casino games in which players bet against the house.

At a hearing in Los Angeles federal court Monday, Letts said that even if the tribes believed the state was acting in bad faith, they had no right to install slot machines and other such games without a compact.

The federal law "simply does not contemplate" casino-style gambling in the absence of tribal-state compacts, he said.

The quarrel between the tribes and California centers on the use of video slot machines. The state denied any obligation to negotiate over their use on the grounds that they are absolutely prohibited by California law.

But the tribes contended that the machines are 'functionally similar" to electronic devices used by the California state lottery, and therefore legal, too.

To resolve the dispute, the tribes and the state agreed to submit the issue to the federal courts, which have jurisdiction over Indian lands.

The agreement specified that in the event of an adverse ruling, the state could appeal the case before agreeing to permit slot machines.

After winning initial victories in the lower courts, the Indian tribes either incorporated or expanded the use of slot machines at their casinos, leading to a confrontation with the state and the federal government.

The U.S. attorney's office in Los Angeles filed suit in early 1997 seeking an injunction against nine Indian tribes in Southern California.

Letts initially denied a preliminary injunction against the tribes.

Federal prosecutors took no further action until this spring, when Wilson signed a compact with the Pala band of Indians in San Diego County that allowed the use of video gambling machines in which players bet against one another, as opposed to the house. That would be legal under California law.

With that, federal prosecutors in San Diego, Los Angeles, Sacramento and San Francisco moved to seize slot machines at Indian casinos throughout the state.

When the seizure issue came before Letts, he decided to first take up the earlier lawsuit by the U.S. attorney's office.

But lawyers for the nine tribes were not expecting a ruling from the judge when they appeared in court Monday.

Bernard Simons, lawyer for the Agua Caliente Indians, said he thought the hearing was intended to discuss various hypothetical issues raised by the judge.

He and other Indian lawyers said they were counting on a full-blown court hearing at which they could present evidence challenging the government's claims.

"No one contemplated this [ruling] was even a possibility today," said Michael Cherry, one of about 10 lawyers representing the Indian tribes before Letts.

Cherry, who also represents the Agua Caliente tribe, told Letts that "the manner in which this decision is being made violates the due process rights of the Indian tribes."

Responding to the criticism, Letts invited the Indian tribes' lawyers to submit briefs to him on any factual issues that might change his opinion.

In addition to the Agua Caliente Indians, the tribes affected by the tentative ruling include the Santa Ynez, the Cabazon, the Cahuilla, the Morongo, the Pechanga, the San Manuel, the Soboba and the Twentynine Palms band. They are among about 40 tribes throughout the state that operate gambling casinos. Most of the revenues at the casinos are derived from slot machines, which number in excess of 13,000, according to federal authorities.

Several other lawsuits are being litigated elsewhere in the state and an initiative has qualified for the November state ballot in which voters will be asked to determine whether existing video machines can continue to be used in Indian casinos.

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