California Poker Rooms

Today, California boasts of more than 100 card clubs throughout the state, from Los Angeles to Manteca, and from San Francisco to Sacramento. Strict rules prevent the clubs from offering slot machines and other games of chance, but poker and special California versions of blackjack, pai gow, Chinese poker, and other patron-banked games are available to customers over the age of 21.

Poker rooms in said clubs offer many variations of poker, including Limit and No Limit Texas Hold’em, Omaha, Stud, Draw, and newer games of interest to players.

The Gambling Control Act of 1997 legalized these card clubs and poker rooms, which are regulated by the California Gambling Control Commission. Members of the GCC are appointed by the governor, and the group works closely with the Bureau of Gambling Control within the Attorney General’s office.

The Online Poker Debate

Many California poker rooms have expressed some level of interest in the legalization and regulation of online poker in the state. The partnership between a card room and online poker company has the potential to bring more business to the land-based rooms as well as expand the customer base and increase revenue.

Legislators widely recognize the need for poker rooms to participate in any discussions surrounding online poker legislation. However, Indian tribes and horse racing establishments are also part of the debate, and it has taken years for the entities to come to any agreement on legal wording for the proposed bills.

In the years of online poker discussion up to 2015, most large California tribes and card rooms were in agreement that PokerStars and Full Tilt should not be allowed into the California market. That meant they supported a bad actor clause, barring licenses to any company that did business in the United States after the implementation of the 2006 Unlawful Internet Gaming Enforcement Act (UIGEA). However, when Amaya purchased PokerStars and Full Tilt in the Rational Group acquisition in 2014, opinions on the subject began to change.

In 2015, a group of California entities announced a coalition to push for legalized and regulated online poker in California. Amaya, complete with PokerStars, partnered with the three largest card clubs in California – the Bicycle Casino, Commerce Casino, and Hawaiian Gardens. The Morongo Band of Mission Indians and the San Manuel Band of Mission Indians also joined the group. All parties were integral in helping draft new online poker bills that did not include a bad actor clause.

A new development in 2016 may have changed that. Regulator AMF of Quebec filed insider trading charges against several individuals associated with Amaya, including CEO David Baazov. The five charges against Baazov followed an extensive investigation and accused him of using privileged information about the purchase of Rational Group to profit and influence the market price. This prompted a San Manuel official to express concern over the allegations and future of the partnership.

As of late April, the PokerStars coalition remains intact and pursuing online poker legislation as a united alliance. The fact that the New Jersey Division of Gaming Enforcement conducted a thorough investigation of Amaya before allowing the company to launch its online gaming products in New Jersey, as well as extended its temporary license for six months, has eased some fears for members of the coalition in California. However, the Amaya situation remains in flux as Baazov is now on an indefinite paid leave of absence to deal with the legal situation, and he continues to assert that he and a group of investors plan to buy Amaya and take the company off the public market.

The latest California online poker bill from Assemblyman Adam Grey addresses the issue indirectly. An amendment to AB 2863 just before an April hearing reopens the bad actor issue up for debate. Before the bill would be presented for a vote in the legislature, the principles involving bad actor licenses would have to be crafted and agreed upon by all parties involved.

Meanwhile, other card rooms around the state of California remain quiet on the entire issue of online poker. While most of them are interested in participating in such an industry, they have yet to officially weigh in on the PokerStars coalition or the latest bill presented for testimony and discussion.