States Line Up Against National Lottery

At least four states say the National Indian Lottery proposed by the Coeur d’Alene Tribe is unlawful in their states, and they’re threatening to fight it.

“The game in Minnesota is clearly illegal,” said Fabian Hoffner, assistant attorney general for Minnesota.

“It would violate our laws,” said Jim Haney, spokesman for Wisconsin attorney general James E. Doyle. Doyle has said he’ll fight any attempt to bring the lottery to Wisconsin.

“On the preliminary look at it, it would be illegal,” said Tom Gede, special assistant attorney general for California. “We’re continuing to do research on it.”

The deputy director of the Arizona State Gaming Agency also challenged the tribe’s proposal, saying the tribe must have state permission before doing business in Arizona.

Tribal attorney Ray Givens said Tuesday night that the tribe is on firm legal ground. “Attorneys general can make all kinds of claims,” he said.

“The tribe thoroughly researched all aspects of the legality of the national lottery before going forward with it,” Givens said. “The Coeur d’Alene Tribe is firmly convinced of its legality.”

At the National Indian Gaming Commission, in Washington, D.C., general counsel Michael Cox said the commission’s approval of the lottery addressed only the legality of the tribe’s management contract with Unistar Entertainment Inc. of Denver.

The tribe has approval for the lottery from the gaming commission and the U.S. secretary of the Interior. It also has a compact with the state of Idaho that allows a lottery.

“We did not approve the lottery. We approved a management contract,” Cox said. “We told the tribe in the contract that ‘you’re going to have to deal with the states.”’

The tribe’s gaming director, Dave Matheson, has said the tribe expected opposition to the lottery.

Since the tribe’s announcement of the lottery Monday, the Idaho Attorney General’s Office has fielded numerous requests for information and documents. The tribal headquarters in Plummer has also received a flurry of calls from reporters and potential lottery players. The tribe plans to offer the lottery in the 36 states with lotteries, plus Washington, D.C., this fall.

Some states were looking closely at the tribe’s proposal even before Monday’s announcement. On Feb. 23, Minnesota Attorney General Hubert “Skip” Humphrey III wrote a letter to a U.S. attorney in Minneapolis, calling for an investigation of the tribe’s “potential violations” of Minnesota law.

Humphrey said the tribe’s proposal doesn’t meet federal requirements that say Indian gaming must take place on Indian lands. Under the tribe’s proposal, players throughout the country would phone in to the lottery center on the Coeur d’Alene reservation.

“Accordingly, while portions of the lottery are conducted on Indian lands, a significant portion is not,” Humphrey wrote.

To run a lottery in Minnesota, the tribe would have to have a compact with that state, Humphrey said. But he said it would be impossible for such a compact to exist, because federal law requires that a tribe own land in a state before negotiating a compact.

Other states echo those concerns.

Givens wouldn’t respond directly to those criticisms. But he said, “The tribe strongly feels that any lawsuit challenging the lottery is frivolous, and will be most vigorously defended - totally frivolous.”

Any legal battles are the tribe’s concern, said Cox of the National Indian Gaming Commission.

“It did not fall to the commissioners to sort out every aspect of whether this is do-able,” Cox said. He said the gaming commission warned the Coeur d’Alenes the lottery would create “an incredible reaction from the lottery states.”

“Obviously, states protect their lotteries,” Cox said.

Cox said he’d been on the phone all day Tuesday, fielding questions from reporters, attorneys and a member of Congress.

“I’ve gotten one call from the Hill, and I expect more,” he said.

In California, Gede said his state would likely try to file criminal and civil charges against anyone advertising the tribe’s lottery, on the basis that they’re illegally promoting gambling in the state.

“I know they have lots and lots of attorneys, but this state has its own interest to pursue,” he said. “On the face of it, it’s a small, impoverished Indian tribe. But this is the gambling industry.”

In Minnesota, Hoffner said the state isn’t worried about lottery competition, but about maintaining the law.

“This is a law enforcement issue, it is not a competition issue,” he said.

Givens said he’s confident the tribe will prevail. “The Coeur d’Alene Tribe is a very responsible government,” he said. “No responsible government takes a step this big without being sure of its legality and success.”