CONCHO — The Cheyenne and Arapaho Tribes is betting on the outcome of a federal lawsuit to re-establish its Internet gambling website.
The tribe, based in Concho, wants to operate pokertribes.com with international players, which the state agreed to under its gaming compact. But the U.S. Department of the Interior put a stop to it last month. The site is currently inactive.
The tribe filed the lawsuit Thursday in federal court in Oklahoma City, asking a judge to prevent the Department of the Interior from interfering. Sally Jewell, secretary of the Interior, and Kevin Washburn, assistant secretary of Indian Affairs, are named as defendants.
A few states this year legalized Internet gambling, allowing private firms to open gambling websites, though they are restricted to in-state players. Tribes, too, are looking to cash in with similar ventures. In Oklahoma, the Cheyenne and Arapaho Tribes is the only tribe that has an agreement with the state to operate such games from tribal lands with international players, said Steve Mullins, general counsel for Gov. Mary Fallin.
“It's pretty groundbreaking,” said Richard Grellner, an attorney representing the tribe. “In Oklahoma, we have the Native American culture we can sell to the world, and the state and the tribes can really benefit.”
Tribe leaders estimate they could generate $132 million annually by 2018 if the website attracts 2 percent of the worldwide online gaming market, according to the court filing.
Under the tribal compact, it would pay the state 4 percent of the first $10 million in annual net revenue from electronic gaming, 5 percent of the next $10 million and 6 percent of any subsequent amount, plus a monthly 10 percent from non-house banked card games, or games in which the casino or host has no stake in the outcome.
The Cheyenne and Arapaho Tribes spent $9.4 million to set up the website, Grellner said. It has to comply with the state's stringent controls to ensure players are from outside the United States.
The tribe operates the Lucky Star Casino at Concho and at Clinton. According to the lawsuit, the tribe wanted to open additional casinos near major cities but has been denied land purchases by the U.S. Department of Interior, so it turned to Internet gaming and developed the Poker Tribes website to generate revenue.
Pokertribes.com began offering free play in June 2012 without restricting players to a geographical area, but the state objected. In April, an agreement was made between the tribe and the state to allow overseas gaming only.
Originally, the agreement was for the tribe to share 20 percent of its revenue with the state, but Washburn, the assistant secretary of Indian Affairs, disapproved, court documents state. So the state and tribe rewrote its agreement to reflect the current profit-sharing arrangement.
Washburn again disapproved, stating that it “introduces an inappropriate basis for revenue sharing in a Compact. The State cannot control, nor can it offer, exclusive access to a market of patrons located entirely outside the United States and its territories.”
Calls and emails to Indian Affairs and the Department of the Interior seeking comment were not immediately returned.
It's pretty groundbreaking. In Oklahoma, we have the Native American culture we can sell to the world, and the state and the tribes can really benefit.”
an attorney representing the tribe