BILL ANALYSIS �
AB 156
Page 1
CONCURRENCE IN SENATE AMENDMENTS
AB 156 (Lara)
As Amended June 29, 2011
Majority vote
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|ASSEMBLY: |74-0 |(May 23, 2011) |SENATE: |36-0 |(August 31, |
| | | | | |2011) |
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Original Committee Reference: G.O.
SUMMARY : Provides that a gambling establishment that conducts
play of a controlled game that has been approved by the
Department of Justice (DOJ), but is later found to be unlawful,
has an absolute defense to any criminal, administrative, or
civil action provided the game was being played in the manner
approved and, during the time for which it was approved, and
play ceases upon notice that the game has been found unlawful.
The Senate amendments :
1)Delete language that permitted a contract for the sale or
lease of real or personal property to specify a closing date
earlier than 90 days after the submission of the contract to
the California Gambling Control Commission (CGCC) if the
commission had approved the contract and the parties had
requested it.
2)Provide that a contract for the sale or lease of real or
personal property that requires the approval or licensing of
the purchaser by the Commission shall not specify a
transaction closing date that is prior to the approval or
licensing by the CGCC.
3)Require a contract for the sale of a gambling enterprise to
state whether any outstanding gaming chips from the seller
will be honored by the purchaser, and provides for redemption
of gaming chips by either the seller or the purchaser in the
event the purchaser does not intend to sue the same gaming
chips in use by the seller.
4)Provide that in any enforcement action, the gambling
enterprise shall have the burden of proving that the
department approved the controlled game and that the game was
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played in the manner approved.
EXISTING LAW :
1)Provides pursuant to the Act, the licensure of certain
individuals and gambling establishments involved in various
gambling activities, and for the regulation of those
activities, by the CGCC.
2)Provides for the enforcement of those activities by the Bureau
of Gambling Control (Bureau) within DOJ.
3)Limits the transfer of property if the transferee has to be
approved or licensed by the commission, and specifically
prohibits a contract for sale or lease of real or personal
property that requires approval of the commission, as
specified, from specifying a closing date earlier than 90 days
after the submission of the contract to the commission, as
specified.
4)Requires CGCC to approve the play of any controlled game,
including, but not limited to, placing restrictions and
limitations on how a controlled game is played.
5)Provides that a banking game does not include a controlled
game if the published rules of the game feature a
player-dealer position and provide that this position must be
continuously and systematically rotated amongst each of the
participants during the play of the game, and if other
specified conditions are met.
6)Defines "house" to mean the gambling enterprise, and any
owner, shareholder, partner, key employee, or
landlord thereof.
7)Defines "gambling enterprise" to mean a natural person or an
entity, whether individual, corporate, or otherwise, that
conducts a gambling operation and that by virtue thereof is
required to hold a state gambling license under the Act..
FISCAL EFFECT : Unknown
COMMENTS : According to the bill's sponsor, Commerce Club
Casino, this bill will provide that if a card club is playing a
controlled game approved by the Bureau of Gambling Control
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(Bureau) within DOJ in the manner in which it was approved, the
approval by Bureau shall be an absolute defense to any action
that is brought through the criminal courts, administrative
courts, or civil courts if the game being played is later ruled
to be deemed unlawful.
In at least one situation, a game approved by Bureau was
subsequently found to be unlawful by the Court of Appeal. The
Attorney General then brought administrative action against
numerous card clubs for playing a game which they had approved.
This bill seeks to insulate a club from criminal, civil and
administrative action if a game that has been approved by the
Bureau and is played in the manner in which it was approved.
Similar language vetoed last year . SB 1125 (Florez) of 2010,
was vetoed by Governor Schwarzenegger. The bill contained two
provisions, one of which is in this bill. SB 1125 contained the
same "absolute defense" language which stated that a gambling
establishment that conducts play of an approved controlled game
that is subsequently found to be unlawful shall be
protected from any criminal, administrative, or civil action,
provided that the game was played in an approved manner and was
not played after it was found to be illegal.
The veto message stated in part :
This past legislative session, my Administration
sponsored several bills to address the issue of
tort reform. Similar to this measure, one of these
measures provided for limited immunity for
businesses that engaged in conduct that was
approved by a federal or state agency. However,
even this modest reform contained a provision that
prevented an absolute defense if the business in
question intentionally misrepresented material
information or defrauded the public entity that
gave its approval.
I am unable to sign this bill because, unlike the
measure previously mentioned, this bill does not
take into account possible misconduct by a gambling
establishment that may have induced the Bureau to
erroneously approve a controlled game. In
addition, there may be other instances where a
gambling establishment may be playing a controlled
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game in bad faith and in violation of other
provisions of existing law. Notwithstanding the
fact that the Bureau may have approved such
conduct, that approval alone should not constitute
an absolute defense to all civil, criminal, or
administration actions.
Analysis Prepared by : Felipe Lopez / G. O. / (916) 319-2531
FN: 0002561