State Supreme Court overturns Indian Gambling intiative

The 6-1 ruling said the measure, which was passed last November but never took effect, violated a state constitutional ban on Nevada-style casino gambling.

An appeal to the U.S. Supreme Court appears impossible, because the ruling is based on California law, on which the state court is the highest authority. The decision also limits California tribes' ability to negotiate an expansion of reservation gambling with Gov. Gray Davis.

Proposition 5 was approved by 63 percent of the voters last November after a campaign that cost nearly $100 million, a national record for a ballot measure.

About two-thirds of the money came from tribes who sponsored the initiative. The opposition campaign was largely bankrolled by Nevada casinos, which also funded one of the two lawsuits.

The measure, on hold while the court reviewed the case, legalized a wide range of lucrative, previously banned video gambling terminals and card games on California Indian reservations.

Tribes turned to the ballot after then-Gov. Pete Wilson refused to allow the expansion they sought. Federal prosecutors say tribal casinos are operating thousands of illegal slot machines, but they've held off on enforcement during the court case.

Sponsors of Proposition 5 are also circulating petitions for a March 2000 initiative aimed at repairing legal defects the court finds.

Davis, who took no position on the ballot measure, has been negotiating with tribes on possible casino expansion. Retired federal Judge William Norris, Davis' representative, said last week he planned to present a proposed agreement to the tribes soon.

The suits before the court were filed by a Nevada-backed group of homeowners and businesses who objected to expansion of nearby tribal casinos, and by the Hotel Employees and Restaurant Employees International Union, which considered the measure's protections for unions inadequate.

They argued that Proposition 5 violated a provision of the 1984 initiative, now part of the state Constitution, that established the California lottery. It prohibits the Legislature from allowing "casinos of the type currently operating in Nevada and New Jersey."

The suits also contended that the initiative violated federal law, which authorizes each state's governor to negotiate with tribes on the scope of reservation gambling. Another claim was that the measure violated the governor's constitutional authority and was a special-interest contract, not a law.

The case is Hotel Employees and Restaurant Employees vs. Davis, S074850.

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