Tribal Casino operators in Oklahoma have prevailed after a court rules in their favour in a legal battle with the state’s Governor over the renewal of gaming compacts.
This past Tuesday, Judge Timothy DeGiusti, US District Court Judge, ruled and affirmed the automatic renewal of compacts between the casinos and the state on the 1st of January, 2020. Thus, the compacts, as they stand, are entirely valid for the next 15 years, after the previous term expired.
This dispute dates back to the summer of 2019, when the state’s Governor, Kevin Stitt, stated that he would demand a higher share from gaming revenue that the original that was agreed upon in 2004. The tribes have been paying variable rates between 4 and 10 percent. At the same time, the Governor wants that raised to 20 percent in exchange for exclusivity.
The casino tribes noted that they were willing to have a talk with the Governor on this matter, provided he acknowledged that compacts auto-renewed when 2020 started. However, when the Governor refused those terms, the tribe sued in a federal court. A few other tribes in Oklahoma joined the lawsuit.
The tribe argued based on a 2004 compacts clause that guarantees automatic renewal on agreed terms if the state racetracks are allowed to provide electronic gaming via any state or court action.
As far back as 2005, the Horse racing commission in Oklahoma started issuing e-gaming licenses to racetracks and tribal casinos, which included two e-gaming approvals to Remington Park as well as Rogers Downs in October of 2019. The tribe considers this issuance of government action.
But, the Governor claims that the Horse Racing Commission approved trace licenses before the compacts taking effect. So 2019’s licenses are only a fulfillment of state administrative requirements, which according to the Governor, do not qualify as new government action.
The Judge did not buy into the Governor’s argument of what amounted to government action and thus found that the Horse Racing Commission has indeed issued a gaming license to race tracks on the effective date of their compacts. In this regard, no more is necessary for the compacts to be renewed automatically.
This court battle cost the people some $1.5 million, a sum the officials outside of the Governor’s office claim, would have been unnecessary had the Governor elected to keep them out of the process.