PokerStars, Morongo, and San Manuel Respond to Assemblyman Mike Gatto’s iPoker Bill

Last updated on November 2nd, 2018

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In response to the introduction of an Internet poker bill to the California State Assembly last week, PokerStars and its business partners in the state released an announcement. The statement suggested PokerStars and its California allies (Morongo, San Manuel, and three L.A. card rooms) wanted to work with legislators to create the best online poker system for the state, but insisted any system would include the world’s biggest poker room. Working along that premise, the coalition of gaming entities would fight any legislation which excluded Amaya Gaming, which owns Rational Media, PokerStars, and FullTilt Poker.

The statement was in response to AP 9, an iPoker bill written by Assemblyman Mike Gatto. The proposed legislation would legalize, license, regulate, and tax online poker rooms in the state of California.

Only land-based gaming casinos and card rooms would have the right to launch iPoker sites in California, though these sites would be able to make licensing agreements with the kind of poker software companies who specialize in such gaming. Gatto’s legislation bans “bad actors”, though, a term used to describe gambling operators who did not follow US federal gaming laws–in specific the Unlawful Internet Gambling Enforcement Act–after the UIGEA went into effect on January 1, 2007.

Mike Gatto Writes iPoker Bill

Gatto’s new bill allowed for the California Gaming Commission to waive the ban on PokerStars, if Amaya Gaming could prove definitely that the world’s biggest poker site would not harm or corrupt the California online poker industry. This seemed to open the door for a settlement which would be acceptable to PokerStars, though the wording on how Amaya Gaming might provide proof to the commission was vague.

Today’s statement shows that PokerStars and its various potential business partners are not any more pleased with the new legislation than they were with the previous iteration of the bill, which was sponsored by Assemblyman Reggie Jones-Sawyer in the summer of 2014. California’s lawmakers have proposed a series of bills that would legalize online gambling in the state since 2008, but none of those bills were approved in even one of the houses of the California legislature. At present, Mike Gatto’s newest bill does not have a counterpart in the California Senate.

The bill doesn’t appear to have support from PokerStars, Morongo, and San Manuel, either. That coalition of gaming enterprises released a joint statement which sounded defiant, despite attempts to make that defiance seem reasonable and just.

PokerStars’ Joint Statement

The statement released on December 4 stated, “As a coalition, we are committed to working with legislators and our other partners in the gaming community to pass Internet poker legislation in 2015 that establishes a vibrant, competitive marketplace, provides superior consumer protections, and ensures that the state receives a reasonable return.”

The press release by Amaya Gaming, the Morongo Band, and their allies sounded a hopeful note in calling for wise legislation. The statement continued, “We are convinced that the various interests must work together if we are to be successful in establishing a well-regulated environment and the best-in-class Internet poker industry for California. Unfortunately, AB 9 is a rehash of previously unsuccessful proposals.”

Will Fight Artificial Competitive Advantages

In the final paragraph of the statement, the coalition voiced their willingness to fight for PokerStars’s full inclusion in the California iPoker community. The statement invoked fairness in the marketplace, a traditional American value.

It said, “Any bill that seeks to establish artificial competitive advantages for some, while denying Californians the best online poker experiences, will only serve to divide the community and will be opposed by our coalition.”

Morongo and San Manuel Versus Pechanga and Allies

The Morongo Band of Mission Indians and the San Manuel Band of Mission Indians are suggesting that the majority of Native American tribes in California who want PokerStars banned are doing so for their own selfish reasons–not due to ethical concerns. PokerStars is the biggest online poker room in the world and it has been on top for an entire decade.

To include that brand name in the California iPoker market would cost the Pechanga Indians and their political allies a lot of money. For that reason, the coalition suggests that those tribal gaming companies are trying to influence California lawmakers to pass bad actor laws–essentially barring their most formidable competition.

Pechanga Indian’s Talking Points

The Pechanga Band of Luiseno Mission Indians and their many political allies would argue that many online gambling companies followed US law and deserve to be rewarded for that. At the same time, PokerStars and FullTilt Poker continued to operate after the UIGEA law went into effect, so they should not be allowed to operate as if they were just any other company. Just because Amaya Gaming now owns PokerStars, does not mean the brand is any less guilty. They continue to operate from the advantageous position of having collected American money from years of breaking the law.

Of course, the UIGEA stated that gaming companies were breaking the law if they were allowing Americans to play in violation of the 1961 Wire Act. From 2007 to 2011, the US Justice Department interpreted that to mean online sports betting, Internet casinos, and online poker sites. Now, the Justice Department only sees online sports wagers as illegal. Amaya Gaming would say PokerStars is being punished for violations of a law that are unclear and still unsettled–so they did not violate the law at all.

About PokerStars’ Associates

Earlier this year, PokerStars signed a partnership deal with the Morongo Band of Mission Indians and the San Manuel Band of Mission Indians. That deal would work similarly to the deal between 888Casino and Caesars Interactive in the New Jersey market. The land-based casinos would carry the online gaming license, while PokerStars would provide software support and its massive international community of poker players. Three private Los Angeles area poker rooms–the Bike Card Room, the Commerce Card Room, and Hawaiian Gardens–also signed deals with PokerStars.

Obviously, those contracts are not active at the moment. If ever California approves an iPoker gaming bill and creates licensed online poker in the state, then PokerStars would be ready to enter the gaming market. Of course, Amaya Gaming and PokerStars would have to find a way to convince California’s political and regulatory leaders to approve such an arrangement–which is where the bad actor legislation comes into play.