California's cardrooms have initiated two legal actions against the recent regulations introduced by Attorney General Rob Bonta, which prohibit blackjack-style games and modify the rules for third-party proposition player services.
Earlier this week, the California Gaming Association (CGA), with backing from the California Cardroom Alliance and Communities for California Cardrooms, filed the lawsuits in the San Francisco Superior Court.
The lawsuits aim to prevent the enforcement of the regulations approved by the California Department of Justice’s Bureau of Gambling Control last month and request the court to annul these rules.
The new regulations are set to take effect on April 1, with cardrooms required to submit their compliance plans by May 31.
These regulations outlaw traditional blackjack-style games that involve a target score of 21 and impose stricter conditions on the rotation of the player-dealer role within cardrooms.
The industry contends that these changes will drastically affect their business operations. CGA President Kyle Kirkland stated, “Attorney General Bonta’s regulations threaten to eliminate more than half of California’s cardroom jobs and wipe out a critical source of revenue for dozens of cities. These games have operated legally for decades under multiple Attorneys General, yet one public official is now moving to shut them down without identifying a single public safety concern or addressing the 1,764 public comments regarding these regulations.”
The press release cites the state’s Standardized Regulatory Impact Assessment, which indicates that the changes could result in a 50% reduction in employment and revenue.
It estimates that cardrooms could lose approximately $464 million in annual income and foresees an average of 364 fewer full-time equivalent jobs each year, totaling over 3,600 positions lost over the next decade.
Interestingly, the analysis predicts that tribal casinos would benefit from an increase of about $232 million in annual revenue.
The lawsuit claims that the regulations represent “an unprecedented power grab by the Attorney General that contradicts state law in multiple ways.”
Moreover, the lawsuits highlight the potential economic repercussions for municipalities across California. Many local governments depend significantly on tax revenue from cardrooms, which constitutes a large portion of their general fund income.
Hawaiian Gardens is one of the most affected municipalities, with Councilmember Victor Farfan previously stating that the city’s Gardens Casino contributes around $13 million to the city’s total general fund of approximately $20 million. Farfan emphasized that the ban is “not an abstract policy debate; it’s a matter of economic survival” for the city.
Other municipalities, such as Bell Gardens and the City of Commerce, also rely heavily on cardroom tax revenue, which constitutes about 50% and 40% of their general funds, respectively.
In anticipation of potential revenue shortfalls, the City of Commerce is already planning to introduce a quarter-cent sales tax measure on the June 2026 ballot.
Moreover, larger cities like Fresno and San Jose are also bracing for significant revenue declines. Officials in San Jose have cautioned that the new restrictions could lead to substantial reductions in revenue.