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By Brian Hews
Publisher | Follow X
March 9, 2026
California’s cardroom industry filed two lawsuits this week challenging new gambling regulations approved by California Attorney General Rob Bonta that operators say could eliminate blackjack-style games, cost thousands of jobs, and severely damage the finances of cities that depend on casino tax revenue.
The lawsuits were filed in San Francisco Superior Court by the California Gaming Association with support from the California Cardroom Alliance and Communities for California Cardrooms. The suits challenge regulations issued by the California Department of Justice’s Bureau of Gambling Control that would significantly restrict player-dealer games that have been offered in California cardrooms for decades.
According to the complaints, the regulations threaten the foundation of the cardroom industry by altering how “third-party proposition player” games are conducted. In those games, an outside company acts as the banker rather than the house itself, a structure cardrooms say keeps the games legal under California law.
The Attorney General’s own Standardized Regulatory Impact Assessment concluded the rules could eliminate at least 50 percent of cardroom jobs and revenue statewide. Industry leaders say such losses could force many cardrooms to close.
Unless blocked by a judge, the regulations are scheduled to begin taking effect April 1, 2026, with changes to cardroom game operations expected as early as June.
“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,” California Gaming Association President Kyle Kirkland said in a statement. “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.”
The Department of Justice finalized the regulations February 9 after receiving 1,764 public comments during the rulemaking process. Cardroom representatives say most of those comments warned about the economic and legal consequences of the proposed changes.
How the Dispute Developed
The fight over blackjack-style games has simmered for years between tribal casinos and California’s licensed cardrooms.
California voters granted tribes exclusive rights to operate certain types of banked casino games under the state’s gambling framework. Cardrooms, however, developed a structure using outside banking companies known as third-party proposition players. Under that model, an independent player acts as the banker in each hand rather than the cardroom itself.
State regulators allowed that system to operate for decades. Cardrooms say their games were repeatedly approved by the Bureau of Gambling Control under multiple attorneys general, including former attorneys general Jerry Brown and Kamala Harris.
Tribal governments have long argued the arrangement is simply a workaround that allows cardrooms to run games that function like banked casino games reserved for tribal casinos.
The dispute intensified in recent years, leading the Legislature to pass the Tribal Nations Access to Justice Act, which gave tribes the ability to file lawsuits asking courts to determine whether certain cardroom games violate California gaming law.
Financial Stakes for Cities
The outcome of the case could have major financial implications for several California cities that depend heavily on cardroom tax revenue.
Some municipalities rely on cardroom income for a significant share of their general fund budgets. That revenue often supports police, fire services, and other municipal operations.
San Jose officials recently warned that its cardroom revenues help fund public safety programs including police, fire, and emergency communications.
The City of Commerce, home to one of the state’s largest cardrooms, has already taken steps to prepare for potential losses by placing a quarter-cent sales tax measure on the June 2026 ballot. City officials say the tax could help offset a major budget shortfall if the state regulations sharply reduce gaming activity.
Other cities that host cardrooms are also evaluating contingency plans.
What Happens Next
The immediate legal question will likely be whether a judge temporarily blocks the regulations while the case proceeds.
Cardroom operators are expected to request a stay or injunction to prevent the rules from taking effect. Courts typically consider several factors when evaluating such requests, including the likelihood of success in the case, the risk of irreparable economic harm, and the broader public interest.
Cardrooms argue the regulations would cause immediate and irreversible economic damage to businesses, workers, and city budgets.
The state and tribal governments, however, contend the regulations simply enforce California’s constitutional framework governing casino gaming.
If the court grants a stay, the existing cardroom games could continue operating while the lawsuits move forward. If not, the new rules could take effect even while the case is being litigated.
Whatever the initial ruling, appeals are widely expected. The case could eventually move through the California Court of Appeal and potentially reach the California Supreme Court.
Because of the high financial stakes for both tribal casinos and cardrooms, legal experts say the battle over California’s gambling framework could take several years to resolve.
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