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As new verticals such as sweepstakes and prediction markets threaten to infringe upon tribal gaming exclusivity, tribal leaders and legal experts insist that tribes have to remain vigilant.
Tribes have been among the loudest voices expressing concern about the ongoing expansion of prediction markets, and multiple attorneys who represent tribal interests say the expansion puts tribes at real risk.
“This is an existential threat to tribal gaming if this is allowed to proceed unchecked,” said Joseph Webster, a partner at the law firm of Hobbs, Straus, Dean & Walker. “It really undermines the whole structure that we thought we were operating under.”
“We have to win,” added prominent tribal gaming attorney Scott Crowell. “I’ve been involved in tribal gaming since before IGRA [the Indian Gaming Regulatory Act of 1988] and I don’t know if I have ever seen such an existential threat progress so rapidly.”
Crowell and others say that tribes are already behind in mounting efforts to stem the tide, referencing legal wins by Kalshi in lawsuits against regulators in Nevada and New Jersey to block enforcement actions against the prediction exchange regarding sports-event contracts.
“I admit it; we are playing catch up, trying to figure out how to weigh in on a train that has already left the station with some key victories in Kalshi’s pocket,” Crowell said.
Bryan Newland, a principal at law firm Powers, Pyles, Sutter and Verville who was previously assistant secretary of Indian affairs for the Department of the Interior under President Joe Biden, agreed with the threat posed by prediction markets.
“They will essentially be able to replicate the gaming market nationally without any permission structure and because there is no permission structure, they can move quickly,” he said. “So far, it has been states that have been carrying the water here … but nobody is going to be able to defend the tribal gaming industry outside of Indian Country.
“It’s going to take Indian Country making these arguments, and while it is in the early innings, the more decisions Kalshi racks up in its favor … the more we have to contend with those arguments when we finally decide to bring our challenges.”
Other tribal gaming leaders have expressed similar concerns over the expansion of unregulated sweepstakes casino gaming platforms.
“I don't think as an industry, we have an issue with anybody coming to the table with new ideas, new ways to do things, and trying to look to tribes to partner,” Matthew Morgan, chairman of the Oklahoma Indian Gaming Association, said at last week's SBC Summit Americas in Florida.
“But what we will not and probably cannot stand for is folks coming into our market and doing it in such a way that violates our tribal laws or our gaming compacts.
"If sweepstakes wants to come in and they point to a state law, I recognize that, but state law has no authority in Indian Country,” Morgan continued. “You have to comply with IGRA and you need to comply with the jurisdiction of tribes over those lands, and you can't point to state law and hand me a piece of paper and say, I'm good, right?
“That's not going to meet the threshold for us.”
Jacob Coin, executive advisor to the chairman for the tribal council of the San Manuel Band of Mission Indians, called on state enforcement officials to step up their efforts.
"Illegal gaming is illegal gaming, regardless of how you try to explain it,” he said. “The problem is not so much that these companies are coming in and offering these illegal games; it's the fact that we have law enforcement officers, the Attorney General, and people down below the vertical who refuse to take action.
“If they would just enforce the laws, then maybe these people who provide these games will pay attention,” Coin added. “The law is only as good as the enforcement behind it.”
