“The deal must rotate.”
That deceptively simple rule lies at the center of California’s gambling laws, according to top gaming law scholar I. Nelson Rose. But enforcing it has proved far more complicated.
Rose, one of the world’s leading experts on gambling and gaming law, has spent years examining how cardrooms design games that resemble blackjack while attempting to stay within California’s legal framework. At one point, he said, he was even brought in to settle a dispute over a game’s legality.
“I was once hired by both the DA and a cardclub to evaluate a game,” Rose told ReadWrite. “In fact, I concluded it was too much like blackjack to be offered in California cardclubs.”
That long-running legal tension is now coming to a head. California’s newly finalized gaming regulations will reshape how cardrooms operate beginning April 1, restricting blackjack-style games and tightening rules on how player-banked tables function.
A centuries-old definition of blackjack at the center of California’s cardroom dispute
The regulatory debate traces back to a core principle embedded in California gambling law i.e. cardrooms cannot operate “banking games.”
“California outlaws banking games for cardclubs, not tribes,” Rose said. “A banking game has an historical and legal definition going back centuries. It means that one player continuously takes on all others.”
I have always said that the deal must rotate. It is the reason the licensed cardclubs cannot have an interest in the third-party providers who want to back every dealer. The AG is now trying to put in rules to mandate that the deal rotates.
Professor I. Nelson Rose, gambling and gaming expert
Under California’s system, tribal casinos are permitted to offer house-banked casino games, while licensed cardclubs must run games in which players compete against each other. The banking role must rotate among participants rather than remain fixed.
For years, many cardrooms relied on third-party proposition player providers, outside companies that supply players who act as the bank, to keep games running continuously. The new rules aim to limit that model and require the player-dealer position to rotate more frequently.
Why California’s blackjack-style games are under scrutiny
The other major focus of the regulations is games that closely resemble blackjack.
California law prohibits specific gambling games dating back to the 19th century, including “twenty-one,” the predecessor to modern blackjack. Rose said understanding what lawmakers meant when they outlawed that game is key to interpreting the law today.
“I have done a tremendous amount of research of what ‘twenty-one’ meant when it was added to statutes in 1885,” he said.
His research includes examining historical rulebooks and early gambling literature to understand how the game was played when the statute was enacted.
“For example, at the same time ‘twenty-one’ was added to the prohibited list, the Legislature also outlawed ‘seven and one-half,’ which was the popular Italian casino version of ‘twenty-one’ at the time,” Rose explained.
These historical details matter when regulators try to determine whether modern cardroom games differ enough from blackjack to remain legal.
“I have given legal opinions on games, some of which received patents, that they were different enough to be legal,” Rose said. “But, as I mentioned, I have also determined that some games shared too many characteristics of ‘twenty-one’ to be legal.”
Drawing the line between blackjack and legal alternatives
Many California cardrooms have offered games often referred to as “California 22,” which modify traditional blackjack rules in ways designed to comply with state law.
Rose said regulators are now attempting to draw clearer boundaries between games that are legal and those that are not.
“The [Attorney General Rob Bonta] has done a good, but not a great, job of trying to lay down rules allowing California games of ‘22’ to be legal,” he said.
One element of the regulatory guidance that Rose disputes involves the use of jokers in the deck. Some cardroom games include them as a way to differentiate the game from traditional blackjack.
“I would specifically disagree with his saying that the presence of jokers is irrelevant,” Rose said. “It is highly relevant, since no version of ‘twenty-one’ was played with jokers in 1885, or even in blackjack in today’s casinos.”
Legal questions about regulatory authority
The rules have already triggered lawsuits from cardroom operators, who argue the regulations overstep the authority of the attorney general’s office.
Rose said those procedural issues could play a central role in the legal fight.
“The cardclubs’ petition does a good job of outlining their objections to both the procedures used by the AG and whether the AG even has the power to issue these new regulations,” he said.
In his view, one of the key discussions centers on which state body actually has the authority to approve or modify gambling games.
“Probably their strongest argument is that the power to approve games lies with the Commission, not the Bureau, which is actually just the AG,” Rose said.
Under California’s Gambling Control Act, the Bureau of Gambling Control can recommend limitations on games, while the California Gambling Control Commission ultimately oversees approvals and rule changes affecting how games operate.
A complicated legal framework and bigger policy questions
The conflict points out the unusual structure of California’s gambling market, where tribal casinos hold exclusive rights to house-banked games while commercial cardrooms must operate within a more restrictive framework.
Rose said interpreting those rules often requires navigating decades of statutes, court decisions, and regulatory interpretations.
“You can see how complicated the issues are,” he stated.
With the regulations set to take effect and lawsuits already filed, California’s courts may soon be asked to weigh in on the state’s thorny gambling framework.
“It ignores the public policy questions of whether it makes any sense to have distinctions like this today,” Rose said.
Featured image: I. Nelson Rose / Canva
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