CA Governor Newsom signs off on SB549, allowing tribes to sue card rooms

The California senate passed an amended version of the bill on 31 August 2025. It was filed in March 2023, but didn’t gain traction until this summer. The issue, tribes say, is the use of player-dealers, also known as third-party providers of proposition player services (TPPPS). These are companies that act as the bank in games such as blackjack and roulette.

Indian Country has the exclusive rights to gambling in California, per state law and the federal Indian Gaming Regulatory Act. The tribes and card rooms have coexisted for many years, but in 2007, the card rooms began using TPPPS. The tribes say this infringes on their exclusivity, but they have not had an avenue to pursue change. Because the tribes are sovereign nations, they cannot legally sue the card rooms, thus the need for a one-time exception.

“This law simply provides a reasonable solution to a decade-old dispute and provides clarity to tribes, the state and commercial card rooms,” California National Indian Gaming Association (CNIGA) chairman James Siva said in a press release. “This is good and fair public policy for all parties concerned.

“For much of California history, tribes have been precluded from having access to justice to defend what was rightfully ours. However, with the signing of this bill, Governor Newsom is making good on the spirit of his apology to tribes in 2019 by allowing us to simply seek justice to defend our rights.”

“California’s past has been tragic for tribes”

Siva’s comments point to the bigger picture. While the tribes now have this opportunity to sue the card rooms, they still do not have the right to take legal action in other situations that they say could potentially compromise their sovereignty.

“As one of more than 70 tribal leaders who fought for access to the justice system to protect our voter-granted economic opportunities, I am grateful to the overwhelming majority of legislators and the governor for their support of SB 549,” Viejas chairman John Christman said via CNIGA. “California’s past has been tragic for tribes, but this bill represents an important recognition of our rights and renewed commitment to the future of the state’s Native people.”

With regard to gambling, the bill allows Indian Country one shot at filing a lawsuit. They cannot seek monetary damages and the text of the bill is narrow. The tribes can only sue over the TPPPS issue and both sides must abide by the court’s decision.

From the bill:

The court may make a binding declaration in either affirmative or negative form and effect, which shall have the force of a final judgment, and may issue injunctive relief enjoining further operation of the controlled game or grant any other relief the court deems appropriate.

Card rooms: Cities will lose tax revenue

As much as the tribes lobbied for SB549, the card rooms lobbied against it. They say that if they are not allowed to use TPPPS, some card rooms could go out of business. If that happens, the card rooms say, cities across California will lose tax dollars that support valuable services from fire and police to teachers.

The biggest city with card rooms is San Jose. But it is the smaller cities that likely have more to lose from a change in tax revenue. Cities like Commerce (pop. 11,672) and Hawaiian Gardens (pop. 13,396) say their annual budgets will be slashed by at least half if the card rooms close, according to Cal Matters. The political magazine also wrote that San Jose, California’s third biggest city by population, receives $30m (£22.4m/€26.9m) per year. That is enough to pay 150 police officers or 133 firefighters – if the card rooms shutter.

It’s unclear whether card rooms will shut down or change their offerings if a court rules for the tribes.

California’s card room culture is small compared to tribal gaming. The card rooms told Cal Matters they bring in about 10% of what the tribes do in earnings annually. But representatives from Indian Country previously said that during Covid-related shutdowns, they saw a boost of $100m in revenue. The card rooms, which had to follow orders from the state, were shut down for 14 months in 2020-21, while many tribal casinos were open.