A San Francisco Superior Court judge has invalidated state regulations that would have effectively banned blackjack and other banked card games in California cardrooms. In a June 30 ruling, Judge Richard Darwin found that Atty. Gen. Rob Bonta and the Bureau of Gambling Control exceeded their regulatory authority by attempting to restrict how these games are operated. The decision allows California’s more than 70 cardrooms to continue utilizing third-party businesses that employ people to act as bankers, a practice that state regulators had sought to phase out.
### The Legal Conflict Over Cardroom Operations
The dispute centered on the distinction between California cardrooms and tribal casinos. Under Proposition 1A, passed by voters in 2000, Native American tribes hold the right to conduct “Nevada-style” gambling, such as casino-banked card games, on reservations.
Cardrooms have historically operated by using a rotating “player-dealer” position, often supported by third-party businesses that employ people to act as the banker. The California Bureau of Gambling Control argued that these third-party arrangements were a legal loophole that allowed cardrooms to offer blackjack and games in which players play against the house. In May 2025, the Department of Justice introduced new regulations aimed at curbing these practices. The California Gaming Assn. challenged the rules in court, leading to a preliminary injunction in May before the final ruling by Judge Darwin.
### Economic Impact on California Municipalities
The California Gaming Assn. reports that the sector employs approximately 20,000 people and generates roughly $500 million in annual tax revenue. Industry leaders emphasized that the proposed regulations posed an existential threat to many local economies.
Kyle Kirkland, president of the California Gaming Assn. and owner of Club One Casino, noted that blackjack accounts for approximately 60% of his establishment’s revenue. According to Kirkland, the proposed rules would have forced significant layoffs and crippled the financial stability of cities that rely on cardroom table taxes.
In Los Angeles County, the economic stakes are particularly high. The Commerce Casino, for example, accounts for 40% of the City of Commerce’s general fund and employs 2,200 people. When the state first proposed the restrictions, local officials in affected cities expressed concern over the loss of funding for public safety and essential community services. Mayor Kevin Lainez of the City of Commerce stated that the city had previously declared a fiscal emergency in response to the potential revenue decline.
### Industry Outlook and Future Appeals
While the June 30 ruling provides immediate relief for cardroom operators, the legal battle may continue. Kirkland indicated that the industry anticipates an appeal from the Justice Department.
The core of the dispute remains the interpretation of the “player-dealer” rules. Cardroom representatives maintain that their current operations are consistent with long-standing regulatory approvals and state law. The Department of Justice has yet to issue a formal statement regarding a potential appeal, but the ruling marks a significant setback for the state’s attempt to fundamentally alter how cardrooms handle banked games. For now, cardrooms remain open and authorized to offer their existing game menus, preserving the current economic structure for the cities and employees that depend on them.
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