Seneca-Cayuga Tribe v. National Indian Gaming Commission
327 F.3d 1019, 2003 U.S. App. LEXIS 7284, 2003 WL 1889944 (2003)
Premium Feature
Subscribe to Lexplug to listen to the Case Podcast.
Rule of Law:
A device that qualifies as a permissible "technologic aid" for Class II gaming under the Indian Gaming Regulatory Act (IGRA) is not a prohibited "gambling device" under the Johnson Act when used in Indian country.
Facts:
- The game of pull-tabs is traditionally played by purchasing pre-printed paper cards from a large set, or "deal," and peeling a layer to reveal symbols.
- Diamond Game Enterprises manufactured the "Magical Irish Instant Bingo Dispenser System" (the Machine), an electro-magnetic dispenser for paper pull-tabs.
- The Machine dispenses the next pre-printed pull-tab card from a roll when a player inserts money and presses a button.
- The Machine includes an optional video screen that, after dispensing a paper tab, scans a barcode on the tab and displays its contents.
- To receive a prize, a player must present the physical winning paper tab to a gaming hall clerk for in-person inspection and payment.
- The Seneca-Cayuga Tribe, the Fort Sill Apache Tribe, and the Northern Arapaho Tribe entered into leasing agreements with Diamond Game to use the Machine in their gaming operations.
- At least one of the tribes, the Seneca-Cayuga Tribe, used the Machine as part of its gaming operations.
- The U.S. Attorney for the Northern District of Oklahoma threatened to prosecute the tribes for using the Machine, alleging it was an illegal gambling device under the Johnson Act.
Procedural Posture:
- The National Indian Gaming Commission (NIGC) issued an advisory opinion concluding the Machine was an unauthorized Class III gaming device.
- In response to the tribes' use of the Machine, the United States Attorney threatened to bring an enforcement action for violating the Johnson Act.
- The Seneca-Cayuga Tribe, the Fort Sill Apache Tribe, the Northern Arapaho Tribe, and Diamond Game Enterprises (appellees) filed a complaint in the U.S. District Court for the Northern District of Oklahoma seeking a declaratory judgment.
- The district court (trial court) granted the appellees' motion for a declaratory judgment, ruling that the Machine is a permissible Class II aid under IGRA and not a gambling device under the Johnson Act.
- The federal government (appellants) appealed the district court's judgment to the U.S. Court of Appeals for the Tenth Circuit.
Premium Content
Subscribe to Lexplug to view the complete brief
You're viewing a preview with Rule of Law, Facts, and Procedural Posture
Issue:
Does the Magical Irish Instant Bingo Dispenser System constitute a permissible technologic aid for Class II gaming under the Indian Gaming Regulatory Act (IGRA), thereby exempting it from the Johnson Act's prohibition on gambling devices?
Opinions:
Majority - Henry, Circuit Judge
Yes, the Magical Irish Instant Bingo Dispenser System is a permissible technologic aid under IGRA and is therefore exempt from the Johnson Act. The court established a two-part analytical framework. First, it determined the relationship between IGRA and the Johnson Act, concluding that if a device is a lawful Class II technologic aid under IGRA, it is necessarily protected from Johnson Act prosecution. The court reasoned that Congress, in passing IGRA, specifically authorized the use of technology for Class II gaming and did not intend for the older, more general Johnson Act to undermine this specific authorization, a conclusion supported by IGRA's legislative history. Second, the court determined that the Machine is a Class II technologic aid. Deferring to National Indian Gaming Commission (NIGC) regulations under Chevron, the court applied the NIGC's three-part test and found the Machine assists in playing pull-tabs without being an electronic facsimile of the game. Citing the D.C. Circuit's reasoning regarding a similar device, the court emphasized that the game of chance resides in the pre-printed paper rolls, not the Machine itself, which merely functions as a high-tech dispenser.
Analysis:
This decision clarifies the legal hierarchy between IGRA and the Johnson Act, establishing that IGRA's specific framework for Indian gaming supersedes the Johnson Act's general prohibitions for devices used in Class II gaming. It solidifies a precedent that allows tribes to incorporate modern technology into traditional games like pull-tabs, thereby protecting tribal gaming revenues and fostering economic development. By aligning with the D.C. Circuit, this ruling creates a consistent legal standard for evaluating such devices, reducing uncertainty for tribes and manufacturers and focusing the legal inquiry on the device's function under IGRA rather than its characteristics under the Johnson Act.
