Divided Supreme Court Says Texas Cannot Regulate Tribe’s Electronic Bingo

By Heidi McNeil Staudenmaier and Marsha Cotton

In a 5-4 vote on Wednesday, June 15, the United States Supreme Court resolved a longstanding dispute about the ability of Texas to control gaming conducted by the Ysleta del Sur Pueblo Tribe (the “Tribe”).

The case centered on language found in the 1987 Ysleta del Sur and Alabama-Coushatta Indian Tribes of Texas Restoration Act (the “Restoration Act”). In 1968, Congress recognized the Ysleta del Sur Pueblo as an Indian tribe and assigned trust responsibilities for the Tribe to Texas. The Tribe’s reservation is located near El Paso, Texas. During the early 1980s, Texas renounced those responsibilities. In 1987, the federal government re-assumed the responsibilities for the Tribe, as well as for the Alabama-Coushatta Indian Tribe, by enacting the Restoration Act. The following year, Congress enacted the Indian Gaming Regulatory Act (“IGRA”).

For several years thereafter, the Tribe and the State disagreed on what extent Texas gaming laws applied to the Tribe’s gaming operations. Section 107 of the Restoration Act directly addresses gaming on the Tribe’s lands. It provides in subsection (a) that “gaming activities which are prohibited by [Texas law] are hereby prohibited on the reservation and on lands of the tribe.” However, subsection (b) states that the statute does not grant Texas “civil or criminal regulatory jurisdiction” with respect to matters covered by Section 107.

In a lengthy saga of litigation, Texas has consistently read the Restoration Act as subjecting the Tribe to the entire body of its gaming laws and regulations. In contrast, the Tribe has interpreted the Act’s language to be consistent with the case California v. Cabazon Band of Mission Indians, 480 U. S. 202 (1987) – which laid the groundwork for the passage of the IGRA in 1988.  The Tribe maintained that the Restoration Act barred it from offering only those gaming activities the State fully prohibited.

The Fifth Circuit Court of Appeals repeatedly sided with the State’s view. Most notably, in 1994, the Fifth Circuit determined that the Restoration Act superseded the IGRA and guaranteed the entirety of the State’s gaming laws and regulations would “operate as surrogate federal law on the Tribe’s reservation.” Ysleta del Sur Pueblo v. Texas, 36 F.3d 1325, 1334 (5th Cir. 1994). Litigation related to the Restoration Act had gone on for almost three decades until the Supreme Court decided to hear the issue.

The case before the Supreme Court arose from the Tribe offering electronic bingo at its Speaking Rock Entertainment Center in 2016. The State of Texas attempted to shut down the electronic bingo operation. Under Texas law, bingo is permissible only for charitable purposes and only subject to a broad array of regulations. 

The majority opinion, written by Justice Gorsuch and joined by Justices Breyer, Sotomayor, Kagan, and Barrett, is separated into three parts and begins by analyzing the Restoration Act under rules of statutory construction. The Court reasoned that the State’s interpretation violated many of the Court’s longest-standing rules of statutory construction. Mainly, that the State’s interpretation of the term “prohibit” goes against the plain meaning of the word. In addition, the Court concluded that reading Section 107(a) of the Restoration Act in accordance with the State’s view would render the remainder of the section meaningless.

Second, the opinion identifies “contextual clues” favoring the Tribe’s interpretation of the Restoration Act. The Court revisited its 1987 decision in California v. Cabazon, which distinguished between types of gambling a state may prohibit outright and those it permits in a limited capacity subject to regulation. The opinion noted that the Restoration Act was signed into law only six months after the decision in Cabazon, and the language of the Act tracks in a similar fashion to Cabazon. The Court highlighted that the state bingo laws at issue are nearly identical to the state bingo laws at issue in Cabazon. In Cabazon, the Court regarded the bingo laws as regulatory in nature because the Court found that California permitted at least some forms of bingo. The Court found  this same reasoning “clinches the case” as to Texas’ bingo laws.

Again, looking to the rules of statutory construction, the majority opined “when Congress enacts statutes, it is aware of this Court’s relevant precedents.” The Court recognized that, at the time the Restoration Act was enacted, “Cabazon was not only a relevant precedent concerning Indian gaming; it was the legal precedent.” The opinion also compared the Restoration Act to two other statutes enacted contemporaneously. The other statutes expressly provided that a tribe was subject to both the laws and regulations which prohibit or regulate gambling. The Court stressed that “[t]he implication that Congress drew from Cabazon and meant for us to apply its same prohibitory/regulatory framework here seems almost impossible to ignore.” 

Finally, the Court rejected a variety of public policy arguments advanced by the State. Ultimately, the Court reasoned that a reading in favor of the State’s view would “collapse” the prohibit/regulate dichotomy laid out in the Restoration Act. Significantly, the U.S. Solicitor General’s Office backed the Tribe’s position. After an invitation from the Court to file a brief on the matter, the Office supported the Tribe’s petition to take up the case, saying that the Act should be viewed consistent with Cabazon.

In a strong dissent, Chief Justice John Roberts came to the opposite conclusion. Justice Roberts retorted that the majority’s reading “makes a hash of the statute.” In Justice Robert’s view, the Restoration Act’s text “does not signal an intent to adopt Cabazon Band’s unique dichotomy.” Interestingly, Justice Roberts included with the dissent a photo of electronic bingo machines from the Tribe’s Speaking Rock Entertainment Center. In a footnote, he contends the photo confirms the electronic bingo played at the facility “is about as close to real bingo as Bingo the famous dog.” However, the propriety of the electronic bingo game was not at issue in the case.

Though specific to the laws of Texas, the opinion should have positive implications for another Texas tribe as well. The Alabama-Coushatta Tribe has been embroiled in the same battle with the State for many years over electronic bingo. The Alabama-Coushatta Tribe was also recognized in the Restoration Act and is subject to the same provisions regarding gaming. The Alabama-Coushatta Tribe participated in this case as an amicus.