The
Shingle
Springs Band of Miwok Indians doesn't owe $30 million to a former gaming partner, an appeals court in California ruled last week.
The tribe's agreements with Sharp Image are considered a "management" contracts under the terms of the
Indian Gaming Regulatory Act, the court said on Friday. But since they were never approved by the
National Indian Gaming Commission, they cannot be enforced, the decision stated.
“I always believed the tribe was in the right,” Chairman Nicholas Fonseca said in a
press release. “I’m glad the tribe had the perseverance to stay the course. This is a victory for all tribes in California.”
The tribe and Sharp Image opened a gaming facility in 1996 but it closed a year later. The tribe later partnered with
Lakes Entertainment and opened the
Red Hawk Casino, eventually buying out its agreement with Lakes.
Sharp Image sued the tribe in state court to enforce its old agreements. But the judge who heard the case failed to determine whether they were "management" contracts, the California Court of Appeal for the Third District said in its
67-page decision.
"We conclude that IGRA preempts state contract actions based on unapproved 'management contracts' and 'collateral agreements to management contracts' as such agreements are defined in the IGRA regulatory scheme," Judge William J. Murray, Jr. wrote for the court.
The case drew the attention of the
Department of Justice, which filed a brief in support of the federal pre-emption argument that was embraced by the court. In 2009, the NIGC issued a
letter to the tribe in which the agency's chairman said both of the agreements were unapproved management contracts.
The lower court decision was issued in February 2012 and briefing was complete by August 2013. But oral arguments did not take place until June 23, according to the
court docket.
Turtle Talk has posted documents from the case,
Sharp Image Gaming, Inc. v. Shingle Springs Band of Miwok Indians.
Read More on the Story:
A 2011 verdict nearly shuttered Red Hawk Casino. The tribe just won a reversal.
(The Sacramento Bee September 15, 2017)
California Court of Appeal for the Third District Decision:
Sharp Image Gaming, Inc. v. Shingle Springs Band of Miwok Indians
(September 15, 2017)
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