"Designated player" card games: judge rules against Florida gambling regulators

Florida gambling overseers were wrong to do away with a rule governing controversial "designated player" card games at pari-mutuel facilities without replacing the regulations, an administrative law judge has said.

Judge E. Gary Early's ruling could have widespread implications within the state's gambling industry and could have an impact on a lawsuit filed by the Seminole Tribe of Florida challenging the card games.

In Friday's ruling, Early sided with gambling operators in West Palm Beach, Jacksonville, Melbourne, Miami and other parts of the state, who challenged the Department of Business and Professional Regulation's attempt to repeal a rule governing what are known as "designated player games" or "banked card games," years after regulators first approved the games.

First launched in 2012, the games have become wildly popular among gamblers and are now hosted by nearly every pari-mutuel that operates a cardroom in Florida.

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The industry maintains that doing away with the rule, adopted in 2014, would put an end to games that bring in $87 million a year

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Regulators proposed doing away with the rule late last year, insisting that the way the games are being conducted -and not the games themselves  -violates a state gambling law, which prohibits pari-mutuels from acting as the "bank."

Under Florida law, a "banking game" is defined as one "in which the house is a participant in the game, taking on players, paying winners, and collecting from losers or in which the cardroom establishes a bank against which participants play." Pari-mutuel cardrooms are allowed to conduct games in which players compete only against each other.

But John Lockwood, a lawyer representing the gambling operators challenging the repeal of the rule, argued that doing away with the regulation effectively prohibited the cardrooms from offering the lucrative games, some of which require players to post $100,000 in order to participate.

Gambling regulators' argument that they did away with the rule to provide "clarity with the industry" is "simply untenable," Early wrote.