New Developments in California Gambling Law – 2025. This year has brought a wealth of new legal and regulatory developments for gambling and casinos in California. Many of the developments are driven by the desire of some tribes to monopolize gambling in California, which is filling the coffers of industry lawyers without actually advancing any public interest. Here are the highlights (or low lights) so far:
Tribal Lawsuits against California Cardrooms. Last year, the California legislature authorized tribal casinos to sue California cardrooms for declaratory and injunctive relief to determine if some of the card games offered by cardrooms violate the state prohibition on banked games. (SB 549) The authorization to sue is one-way: the Legislature did not authorize the cardrooms to sue over the legality of the craps and roulette games now being operated by the tribes.
The litigation began in January and could significantly impact the state’s privately-owned card rooms. The card games include Blackjack, Baccarat and Pai Gow, which are operated as house banked games in Nevada and in tribal casinos. In the cardroom version of these games, one player position is designed the player-dealer, and the other players wager against the persons in the player-dealer position, rather than all the players betting against the house or cardroom. The cardrooms have filed motions to strike and dismiss the claims, which have yet to be decided by the court. The case could take several years to be resolved, including though appeals.
If the tribes prevail, many of these games may return to being played in underground, unlicensed and unregulated gambling parlors run by criminal groups. The litigation will hurt municipal budgets and local employment in the urban areas where cardrooms are located. Because the tribal casinos are often located in more rural areas and derive the vast majority of their income from slot machines, one tribal official estimated the tribal gain in table game revenue from the cardroom games closing to be less than 1% of the tribe’s current annual revenues, a negligible amount.
2026 UPDATE: The Superior Court ruled against the tribes on the ground that the state law authorizing the suits is pre-empted by federal law. The tribes have appealed. The appeal should be decided sometime late in 2027 or in 2028.
The Attorney General considers regulation of Cardroom games. Spurred by the tribes, the Attorney General has now also started rule-making to restrict the same cardroom player-dealer games which are the subject of the tribal suits, and which the Attorney General’s office has been approving for decades. The proposed regulations would eliminate Blackjack and restrict the other player-dealer card games but not abolish them. The proposed regulations may become effective some time in 2026, unless the Attorney General defers to the pending court case. Regardless, the cardrooms will seek to enjoin these regulations in court.
Commission Regulations. The California cardrooms are regulated both by the Attorney General and the California Gambling Control Commission. The Commission is considering advertising regulations concerning problem and underage gambling, which provisions are not controversial. But at the suggestion of some tribes, the Commission may also use the advertising regulations to also impinge on the marketing of cardroom player-dealer games. If adopted, the regulations would take effect sometime in 2026. The cardrooms have vowed to fight and enjoin those portions of the regulations dealing with player-dealer games on a variety of legal grounds, including as a violation of First Amendment commercial speech rights.
Sports Betting: Traditional sports betting remains illegal in California. Following the overwhelming defeat Propositions 26 and 27 in 2022, which aimed to legalize online sports betting, tribes have emphasized that any future legalization efforts must be tribal-led. However, there may be a divide among the tribes on working with operators like DraftKings and FanDuel and also a divide over whether mobile betting would be permitted. If these issues are not resolved, a sports betting ballot initiative may not be filed and adequately funded for 2026.
Other Betting Platforms: In 2023, the California Attorney General was asked to issue an opinion on the legality of daily picks predictions, like PrizePicks. (Op 2003-1001) Despite the passage of time, no decision has been announced, which is not surprising given that the Attorney General has never opined on the legality of fantasy sports contests despite their prevalence in California and saturation marketing for nearly ten years. In addition, platforms like Kalshi and Crypto.com offer prediction markets that allow Californians to engage in event-based wagering. Nationwide, tribes are seeking the elimination of these markets.
California gambling law may enter a period of significant change within the next few years, principally due to tribal efforts to monopolize gambling in California, and reflecting tribal influence with the Legislature and elected officials. Nearly every effort will result in litigation, leaving the outcome of each issue in the hands of the third branch, and uncertain in the near and medium term.
