Assemblyman Mike Gatto Wants California Online Poker Bill Passage in 2015

Posted on: December 3, 2014, 03:00h. 

Last updated on: December 3, 2014, 03:20h.

California Assemblyman Mike Gatto online poker bill
California Assemblyman Mike Gatto, sponsor of Bill AB 9, which is yet another attempt to legalize online poker in the Golden State. (Image: AP/Rich Pedroncelli)

A new bill that seeks to legalize California online poker in 2015 has been introduced by Assemblyman Mike Gatto this week. Bill AB 9, dubbed the “Internet Poker Consumer Protection Act of 2015,” aims to establish a regulatory framework that would permit the offering of online poker for players located physically within the state’s borders.

If passed, it would allow games to be up and running within 180 days.

“California has led the world in computer and Internet innovation, and there is no good reason why we can’t continue to lead with a sensible online-poker framework,” announced Gatto. “AB 9 borrows from time-tested business practices that will improve our government finances and keep our money in our home state.”

The bill adopts much of the language used by previously proposed legislation that have thus far foundered in California.

It limits potential licensees to existing tribal operators and cardrooms, and pledges to be tough on “bad actors,” outlining the unwelcome status of “any brand or business name, including any derivative brand name with the same or similar wording, or any trade or service mark, software, technology, operational system, customer information, or other data acquired, derived, or developed directly or indirectly from, or associated with, any operation that has accepted a bet or engaged in a financial transaction related to that bet from any person in the United States on any form of Internet gaming after December 31, 2006.”

Door Slightly Ajar

At first glance, this language seems to preclude PokerStars’ entry to the market, but the bill also includes a clause stating that regulators will have the ability to waive the application of the above paragraph provided that an operator’s “use of the covered assets in connection with intrastate Internet gaming will not adversely affect the integrity of, or undermine public confidence in, intrastate Internet poker or otherwise pose a threat to the public interest or to the effective regulation and control of intrastate Internet poker.”

In other words: “We actually might let PokerStars in, but only if we feel like it,” is the implied message. The door is far from wide open, but it is slightly ajar.

The PokerStars question has been a huge sticking point that has prevented stakeholders from agreeing on the language of previous bills, and it’s one of the reasons online poker hadsstalled in California in the past.

A large coalition of tribal operators is vehemently opposed to a regulated online poker space that might include PokerStars. On the other side of the coin, the Morongo Band of Mission Indians, allied with the largest poker clubs in the state, including the Commerce, the Bike and the Hawaiian Gardens, have signed an agreement with PokerStars to work together in a potential post-regulatory environment.

The San Manuel Band also recently defected to the PokerStars camp. However, it may well be that there is enough in the language of this bill to appease both camps.

Land-Based Sign-Ups Only

Another crucial aspect of the bill is that players will be required to create accounts in person at the poker site’s affiliated land-based cardroom, a measure presumably designed to restrict underage play, but which may well stymie the growth of the game in the state. However, Gatto is confident that this bill could finally make 2015 the year that California gets fully legal, regulated, and taxed online poker.

“AB 9 is different from previous proposals, in that it endeavors to address both the external criticisms of the industry, and expand the pie to obtain accord amongst competing gaming interests,” he said.