Cardrooms Seek Injunctions As New California Regulations Take Effect

California cardrooms filed for two preliminary injunctions Monday seeking to pause the implementation of new state regulations that would limit their ability to offer their most popular table games.

The regulations, announced by California Attorney General Rob Bonta in early February, would dramatically change the way cardrooms may offer their most profitable and popular games, which the state’s gaming tribes have long maintained are run illegally.

In early March, a group of cardrooms and third-party proposition players (TPPPs) filed two lawsuits in San Francisco Superior Court challenging the new regulations.

The lawsuits separately attack two new regulations, one which would limit the type of blackjack-style games cardrooms may offer, the other to amend the operations of the TPPPs, which are special, licensed businesses that help cardrooms offer alternate versions of games that traditionally pit gamblers against the house, otherwise known as banked games.

Both regulations were set to take effect Wednesday. Under the regulations, however, cardrooms don’t have to submit their plans for compliance until 60 days later, May 31.

The cardrooms filed for preliminary injunctions against the two regulations as separate motions in the pending lawsuits.

The state’s own economic assessment of the regulations found that they could result in the loss of hundreds of millions of dollars in revenue for cities as well as hundreds of jobs in California’s cardroom/TPPP sector, which was estimated in 2019 to have a total annual economic impact of $5.6 billion annually, per a report commissioned by the California Gaming Association.

Several cities rely on cardroom tax revenue to balance their budgets. The cities of Commerce and Bell Gardens recently declared fiscal emergencies and put a ¼-cent sales tax on the June 2026 ballot in response to the pending cardroom regulations. Those two cities are located in Los Angeles County and are home to two of the state’s three largest cardroooms, Commerce Casino and Parkwest Bicycle Casino, respectively.

Two new regulations

The cardroom industry argued that the California Department of Justice’s Bureau of Gaming Control should not proceed with either regulation because it had allowed cardrooms to offer blackjack-style, TPPP-facilitated “player-dealer” games for years.

But the tribes countered that the games’ previous approvals were a mistake while also seeking to settle the matter in court with a specially permitted lawsuit.

The new game regulations remove busting from blackjack-style games and bar cardrooms from offering  any blackjack-style game where the target points equal 21. Under the new rules, cardroom games can’t include the words “21” or “blackjack” in their names.

The new TPPP regulation, meanwhile, calls for the role of the house or bank to be offered to every player at a quasi-banked table game before every hand, and stipulates that “[t]he player-dealer position shall rotate to at least two players other than the TPPPs every 40 minutes or the game shall end.”

TPPP employees working contractually within California cardrooms offer to act as the house or bank at every table where quasi-banked games are played. Before a dealer deals a hand of blackjack-style game, he or she offers all of the players at the table the opportunity to serve for a hand or two as the house or bank.

Most gamblers don’t have the means to cover that kind of action. But the employees of TPPPs do. So TPPP workers, who often wear badges identifying themselves as working for a TPPP and not the cardroom in which they are based, volunteer to play the role of the bank. The new regulations require that two other people playing a quasi-banked game besides a TPPP worker must now hold the player-dealer position every 40 minutes or else the game ends.

Combined, the two regulations would force cardrooms to not only rethink the kinds of games they offer but how many of them are played.

Competing California laws

State law also explicitly bans cardrooms from offering banked games in a throwback to the Gold Rush era when legislators were worried miners on the frontier would get hustled. While cardrooms evolved from saloons to glitzy casinos, they long were restricted to offering games like poker, where gamblers wager against each other.

In late 2007, however, an obscure state official named Bob Lytle reinterpreted state law, opening the door for cardrooms to offer variations of traditionally banked games. Today, thanks to both repeated approvals by state regulators and the TPPP that work symbiotically with cardrooms, alternate versions of banked games like blackjack and baccarat are offered off reservation in California cardrooms.

The tribes say this blatantly flies in the face of the will of the people, pointing to Proposition 1A, the ballot measure approved by voters in 2000, which authorized tribal gaming in California.

Prop. 1A gives Native American casinos the exclusive right in the Golden State to offer banked games like blackjack and baccarat, where gamblers wager against the house. Tribes tried to stop cardrooms from offering versions of banked games in court, but judges ruled that as sovereign nations they lacked standing to bring a lawsuit in state court. 

Politicians step in

SB 549, sponsored by former state Sen. Josh Newman and signed by Gov. Gavin Newsom in September 2024, sought to settle the matter once and for all by giving California’s gaming tribes special standing in court to sue cardrooms over the games they offer.

The tribes filed suit as soon as they could in early 2025. But in October 2025, Sacramento Superior Court Judge Lauri Damrell dismissed it, arguing that the federal Indian Gaming Regulatory Act (IGRA) preempted the intention of the legislature and governor. At the time, she acknowledged her ruling “may be wrong,” reflecting the maddening complexity of the legal issues involved.

From the moment Damrell announced her decision, the tribes were expected to appeal. That filing is still pending as lawyers await the release of a briefing schedule by the Third District Court of Appeal in California.