Appeals court upholds ban of tribe's online casino

By Daniel Beauregard | Aug 12, 2018

SAN FRANCISCO — A California appeals court has upheld a lower court’s decision in favor of the state and federal government banning the continued operation of an online casino.

Judge Carlos Bea of the U.S. Court of Appeals for the Ninth Circuit in California wrote in his opinion that the act of placing a bet in the virtual casino while in the state of California was not protected under the Indian Gaming Regulatory Act.

“Desert Rose Casino violated the Unlawful Internet Gambling Enforcement Act (UIGEA),” Bea stated.

In his opinion, the judge explained that even if those betting in Desert Rose Casino’s virtual game room were located on Indian grounds, plaintiffs Iipay Nation’s acceptance of those wagers violated the UIGEA.

“The UIGEA does create a system in which a ‘bet or wager’ must be legal both where it is ‘initiated’ and where it is ‘received.’” the opinion states.

The Desert Rose Casino, run by defendants Iipay Nation of Santa Ysabel, is a server-based bingo game. The defendants hold tribal land located in San Diego County. After the failure of their brick-and-mortar casino on tribal lands, they started the online bingo casino in 2014.

Shortly after its inception, the State of California and the federal government sued the defendants, seeking injunctive relief to prohibit the casino’s continued operation. The district court issued a temporary restraining order halting its operation pending the outcome of the case.

After both sides requested summary judgment in the case, the district court ruled in favor of the plaintiffs, stating the casino was in violation of the UIGEA and issued a permanent injunction barring if from operating.

Iipay appealed the trial court’s summary judgement, which the appellate court has upheld.

“The UIGEA prevents using the internet to circumvent existing state and federal gambling laws,” the opinion states.

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