The Ninth Circuit Court of Appeals has upheld the dismissal of Maverick Gaming LLC’s lawsuit challenging Washington State’s sports betting laws. Maverick, which operates cardrooms in the state, had argued that tribal-state compacts giving exclusive sports betting rights to tribes violated federal law. The court’s decision emphasized the importance of tribal sovereignty, ruling that the Shoalwater Bay Indian Tribe’s involvement was necessary but impossible due to its sovereign immunity.

Sovereign immunity and required parties:

Maverick initially filed the lawsuit in 2022, asserting that Washington’s sports betting exclusivity for tribes violated the Indian Gaming Regulatory Act (IGRA), the Equal Protection Clause, and the Tenth Amendment. Despite its claims, Maverick failed to include the Shoalwater Bay Tribe or other tribal entities as defendants, a key issue that ultimately led to the lawsuit’s dismissal.

The court concluded that the Shoalwater Bay Tribe was a “required party” under Federal Rule of Civil Procedure 19, as the tribe held a legally protected interest in the gaming compacts. Judge Kim McLane Wardlaw, who authored the opinion, explained that proceeding without the tribe would infringe on its sovereign rights and economic interests.

“Because the Tribe has a legally protected interest in the lawsuit that may be impaired or impeded in the Tribe’s absence,” the court stated, “it would be a required party under Rule 19(a)(1)(B)(i).” The court further noted that the tribe’s sovereign immunity made it impossible to include the tribe in the case, leaving no option but to dismiss the lawsuit entirely.

The decision also underscored that the federal government, while having a regulatory interest in tribal gaming compacts, could not adequately represent the tribe’s specific economic and sovereign interests. The court affirmed that the federal government’s role is distinct from the tribes’ direct interests in operating gaming facilities.

Broader implications for tribal gaming:

The court’s decision reaffirms the protections afforded to tribes under sovereign immunity and highlights the complexities of challenging tribal gaming compacts. The Ninth Circuit acknowledged the significant economic benefits these compacts provide to tribes and surrounding communities.

“Maverick’s suit implicates the Tribe’s legally protected economic and sovereign interests,” the court stated, adding that the compacts are a cornerstone of Washington’s tribal gaming industry.

This ruling mirrors the outcome of the original case in the Western Washington District Court, which also found that the tribe’s immunity and necessary role in the case made dismissal unavoidable.

While concurring with the majority opinion, Judge Eric D. Miller raised concerns about the broader implications of Rule 19 in cases involving the Administrative Procedure Act (APA). According to Snell & Wilmer, he noted differing interpretations among federal appeals courts, with some jurisdictions, such as the D.C. Circuit, finding tribes are not always required parties in APA-related cases. Miller suggested the Ninth Circuit should revisit its approach in future cases.

“In an appropriate case, we should revisit the application of Rule 19 to APA actions and consider aligning our decisions with those of other courts of appeals,” he remarked.

Maverick Gaming CEO Eric Persson has indicated his intention to take the case to the U.S. Supreme Court, signaling that this legal battle may not yet be over. For now, the decision solidifies the importance of tribal sovereignty and the challenges non-tribal entities face in attempting to alter established tribal-state compacts.