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Arbitration Award on Tribal I- Gaming with Non-US Players

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Arbitration Award on Tribal I- Gaming with Non-US Players TRIBAL GAMING Arbitration award on tribal i- gaming with non-US players amendment to their Compact the Tribe’s claim that internet An arbitration award by a sole authorising the type of internet gaming was permitted under the arbitrator recently approved a gaming ultimately addressed by the Compact13. The arbitrator defined submission by the State of Award, apparently, due to the belief the question in dispute and then Oklahoma and the Iowa Tribe of that the Compact required recognised there was no real Oklahoma as to the legality of amendment to lawfully include dispute: “This Arbitration involves such games. In the review process only the question of whether or internet gaming in which the server provided by the IRGA7, the not the Tribe is permitted pursuant is located on Indian lands in Department of the Interior (‘DOI’) to IGRA, the Tribal-State Gaming Oklahoma and the players are rejected the Compact on the basis Act, the Iowa Tribal Gaming located outside of the US. Graydon that the increased fees due the State Ordinance, and the Compact to were not justified by any offer and conduct covered games Dean Luthey, Jr., Partner at Gable meaningful concession from the through the use of the Internet Gotwals, discusses the award and State8. The parties agreed to using computer servers located on the questions it raises. another amendment providing for Tribal lands to players located fees equal to the exclusivity fees for outside the boundaries of other covered games. Again, the Oklahoma and the United States An arbitration award by a sole DOI rejected the amendment, this where such gaming is lawful. Both arbitrator recently approved a time finding that because internet parties agree that the Tribe may do submission by the State of play could not be exclusive, so. The Parties do not intend that Oklahoma and the Iowa Tribe of exclusivity fees were inappropriate9. their agreement shall change, Oklahoma as to the legality of The Iowa Tribe picked up the amend, modify, or alter in any way internet gaming in which the Cheyenne and Arapaho Tribes’ any term or provision in the server is located on Indian lands in torch and pursued a different Compact. Rather, they agree that Oklahoma and the players are approach. Rather than amend the the Compact permits the Tribe to located outside of the United States Compact and endure DOI conduct Internet gaming of a (the ‘Award’)1. The Award was scrutiny, the Iowa Tribe and the covered game and that all confirmed as a ministerial act at State turned to the dispute provisions of the Compact are the request of both parties by the resolution provision of the applicable to such gaming.” United States District Court for the Compact. If the parties have a The arbitrator then spent the Western District of Oklahoma dispute over compliance with or balance of his award adopting as without a review of the merits2. the meaning of Compact language, his result the unchallenged The Award, to which no federal they are required to meet and agreement of the parties. In doing officer or agency is a party, raises attempt a resolution of the dispute. so, the arbitrator concluded that significant questions as to the If the dispute cannot be resolved the gambler does not need to be on matters it decides. by such an effort, then either party Indian land to comply with the Oklahoma, by a referendum to can invoke arbitration to resolve IGRA14. He cited no judicial the people, adopted a model state- the dispute. If a party is aggrieved decision involving IGRA’s tribal gaming compact that by the arbitration award, that party requirement that compact gaming authorises certain ‘covered games’ may seek de novo review of the occur on Indian land, although he to be played as Class III games disputed issue in federal court10. did recognise that the National under the Indian Gaming No trial was held with live Indian Gaming Commission Regulatory Act, 25 U.S.C. § 2701 et witnesses. Rather, the parties (‘NIGC’) had taken restrictive seq. (‘IGRA’)3. The Compact does submitted briefs with exhibits, all views of the ‘on Indian land’ not mention internet gaming, of which were admitted into required15. much less internet gaming when evidence, apparently without The Award was confirmed by the the player is not located on Indian objection11. The State, represented U.S. District Court for the Western land4. Likewise, the IGRA does not by the Governor’s General District of Oklahoma. Both parties mention such gaming5. The Counsel, rather than the Attorney supported confirmation, thus Oklahoma Statutes do not General, previously had stated that precluding any obstacle to authorise such gaming6. the Compact fully authorised confirmation16. The Court’s order In 2013, the Cheyenne and internet gaming directed to an did not comment on the merits of Arapaho Tribes and the Governor international market12. In the the Award, or the apparent lack of of Oklahoma negotiated an arbitration, the State agreed with a real dispute between the parties. World Online Gambling Law Report - June 2016 15 TRIBAL GAMING The lack of a real case or In the litigate all issues determined by the controversy between the parties to arbitration, arbitrator. Graydon Dean Luthey, Jr. Partner the State Gable Gotwals, Tulsa the arbitration is problematic as to As a practical matter, the [email protected] any preclusive effect of the agreed with confirmed Award legally settles the Tribe’s confirmed Award on state law claim that little, if anything. The Award, The views expressed in this article are enforcement. The Oklahoma whose merits have not been the author’s alone and do not necessarily internet reflect the views of his firm, the Attorney General or an Oklahoma gaming was judicially reviewed in a contested Oklahoma Indian Gaming Association to District Attorney might attempt to permitted action, much less endorsed, by a which the author is General Counsel, its bring either criminal or civil under the federal court, facially may provide members or the author’s other clients. Compact. enforcements proceedings. In such The arbitrator comfort to tribes who seek to 1. In the Matter of the Referral to Binding case, the defendant would no defined the engage in international internet Arbitration by the Iowa Tribe of doubt argue that the confirmed question in gaming from Indian land in Oklahoma and the State of Oklahoma of Award was binding on Oklahoma dispute and Oklahoma. However, the Award Disputes Under and/or Arising From the then Iowa Tribe - State Gaming Compact, law enforcement personnel, even recognised may not preclude enforcement Arbitration Award, 24 November 2015, though they were strangers to the there was no action by the Oklahoma Attorney Oklahoma City, Oklahoma, Charles S. arbitration and the power of the real dispute General, an elected Constitutional Chapel, Sole Arbitrator (‘Award’). Governor to bind the Attorney officer independent of 2. Iowa Tribe of Oklahoma v. State of Oklahoma, Case No. 5:15-cv-01379-R General is undecided. Law gubernatorial control. The Award (W.D. Okl. 18 April 2016), Order. enforcement likely would then is not binding on the Federal 3. 3A O.S. § 281. explore the circumstances of the Government. The NIGC, 4. Ibid. 5. 25 U.S.C. § 2701 et seq. arbitration and why the Governor congressionally charged with 6. Oklahoma criminalises certain types of advocated gaming that the DOI enforcing the IGRA, and the DOI, gambling and commercial gambling. 21 had previously determined would which approves compacts, have O.S. §§ 941; 982. provide no revenue for the State both expressed misgivings about 7. 25 U.S.C. § 2710(8)(A) & (B). 8. Award, p. 4, n. 24. and for which the Governor had the type of gaming addressed by 9. Award, p. 5, nn. 25-27. The DOI previously unsuccessfully sought a the Award. Application of the ‘on assumed, but did not decide, the legality Compact amendment. Indian lands’ requirement of the of the internet gaming. 10. 3A O.S. § 281, part 12. The Award, after adopting the IGRA has not been finally 11. Award, p. 1. parties’ uncontested position that judicially determined in the 12. Award, p. 5, quoting a 9 December internet gaming involving internet gaming context. Most 2013, letter from Steven K. Mullins, international wagers is lawful, significantly, a major question General Counsel, Office of Governor Mary Fallin. applied various federal criminal remains as to whether the financial 13. Award, p. 7. statutes and determined that those service providers subject to the 14. Award, pp. 13-15. federal laws did not render the Unlawful Internet Gambling 15. Award, p. 14, n. 60. The Award gaming in question unlawful17. No Enforcement Act 2006 (‘UIGEA’) notes that the parties agreed that the game was conducted on Indian lands federal officer or agency was a will regard the Award as sufficient when the players are located outside party to the arbitration. The State legal authority to risk potential Indian lands. Award, pp. 13-14. lacks authority to enforce those federal injunctive and criminal 16. See Order, p. 5, (‘The State has stated in its response that certification of federal criminal statutes. Neither exposure arising from providing the Arbitration Award is proper by this party argued that the federal their services without which Court’). criminal statues make the gaming international wagers cannot be 17. Unlawful Internet Gaming unlawful. The absence of a federal placed. While the Award was a step Enforcement Act (‘UIGEA’); Wire Act, 18 U.S.C. § 1084; 31 U.S.C. § 5362, the party to the arbitration prevents forward for tribes wanting to play Travel Act, 18 U.S.C. § 1952; Illegal any preclusive effect of the Award such games, serious questions need Gaming Business Act, 18 U.S.C.
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