Gaming issues settled, and not

Deal leaves Seminoles, pari-mutuels at odds

South Florida racetracks that offer certain types of card games are trying to hold onto the lucrative business after the state of Florida reached a settlement with the Seminole Tribe.

The state agreed not to appeal a 2016 court decision that allowed the Seminoles to offer blackjack through 2030. In return, the tribe will make revenue-sharing payments to the state until the end of the 2018 legislative session — but only if Florida “takes aggressive enforcement action” against designated player games that operate as banked card games at pari-mutuel casinos around the state.

But the pari-mutuel industry maintains its games are in keeping with state regula-

tions, leaving the state in the position of cracking down on a practice that the industry says is perfectly legal.

So-called designated player games — such as Three-Card Poker and Ultimate Texas Hold’em — are major money-makers for the pari-mutuels. A study of 10 cardrooms estimated they made $55 million in revenue over five years, according to The Innovation Group.

As the games are currently dealt, they are in keeping with Florida law, said Palm Beach Kennel Club attorney John Lockwood.

The Palm Beach Kennel Club, Miami’s Magic City Casino and Pompano Beach’s Isle Casino all offer some form of the games. Casinos in Broward and Miami-Dade offer slot machines, unlike the rest of the state, which make the card games less popular.

The Seminole Tribe is supposed to have the exclusive right to offer banked card games — games in which every player plays against the dealer instead of playing against each other as they do in poker.

“It’s really not complicated. If the players around the table are playing against one person, a bank, it’s a banked card game. If they all have the same bet in a pile and only one’s going to win, then it’s not a banked card game,” said Seminole Tribe lawyer Barry Richard. “The tribe is paying a huge amount of money — more than twice as much as all the parimutuels put together — for exclusivity, and that’s what they want. They’re paying for it, they’re entitled to it.”

While previous iterations of pari-mutuels’ designated player games only had one player act as a “banker,” these days the designated player who acts as a banker can rotate, just like the dealer rotates in a game of poker.

No fixed banker, no banked card game, according to the pari-mutuels.

“It doesn’t matter what you label it,” Richard said. “If what they’re talking about when they say a designated player game is a poker game in which the dealer rotates around the table, then that’s fine. But if, in any hand, everybody’s playing against a banker, that’s the issue. It doesn’t matter what they call it.”

The agreement between the tribe and the state settled a long-running lawsuit over blackjack. Under the terms of the agreement, the tribe will continue to offer blackjack at its casinos through 2030, while the state will get about $340 million over the next year.

In a 2016 federal court ruling, U.S. District Judge Robert Hinkle called designated player games an “egregious example of the cardrooms’ attempt to evade the prohibition on banked card games.”

As long as the state cracks down on these games with “aggressive enforcement” — though what’s considered aggressive is open to interpretation — the tribe will continue to make payments until after the 2018 legislative session.

After the session — or at any time before that it if the tribe doesn’t feel the state is shutting down the games aggressively enough — it could affect the tribe’s payments to the state.

“If the Legislature does nothing, it will be status quo unless the tribe believes there are still table games out there past the 2018 session. And then, they can stop making payments,” said state Sen. Bill Galvano, R-Bradenton, the Florida Senate’s point man on gambling legislation.

Galvano fears that a coming crackdown on pari-mutels will mean pushback by the industry and incredible pressure during next year’s session, especially as the parimutuels think they are now in compliance with the law.

“It’s a tough position for the state to be in,” Galvano said. “There are many parimutuels that have already started designated player games, and they are quite profitable. So, you’re going to have an enforcement challenge, and then from a legislative policy perspective, the choices have now been significantly narrowed. Do you maintain the status quo of gaming in Florida and rely solely on tribal payments, or do you now look to the parimutuel industry for the revenues in lieu of what you have with the tribe?”

“If, in any hand, everybody’s playing against a banker, that’s the issue. It doesn’t matter what they call it.” Barry Richard, lawyer for the Seminole Tribe

FILE PHOTO As long as the state cracks down on so-called “banked” card games with “aggressive enforcement” — though what’s considered aggressive is open to interpretation — the Seminole Tribe will continue to make payments until after the 2018 legislative session.