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March 16, 2021 

VIA EMAIL

Ann Hines Davis 

Law Office of Ann Hines Davis, PLLC 

95 Depot Street 

Waynesville, North Carolina 28786 

 

Re: Review of Eastern Band of Cherokee Indians Consulting Agreements

with American Wagering, Inc.: Harrah’s Cherokee Casino and Harrah’s Cherokee Valley

River Casino

Dear Ms. Davis:

This letter responds to your January 28, 2021 request, on behalf of the Eastern Band of 

Cherokee Indians, for the National Indian Gaming Commission, Office of the General Counsel, 

to review two essentially identical proposed Consulting Agreements between the Tribe’s Tribal

Casino Gaming Enterprise and American Wagering Inc. (“Consultant”); one for the Harrah’s

Cherokee Casino Resort, and the other for Harrah’s Cherokee Valley River Casino & Hotel. The

agreements are undated and do not contain identifying draft numbers, but were submitted on 

January 28, 2021. For the purposes of this letter, the term “Tribe” is used interchangeably to

refer to the Tribe and/or the Casino. The draft Consulting Agreements stipulate that the 

Consultant will provide each casino consulting services and other certain tasks to help the Tribe

develop and operate land-based sports betting facilities (“Sports Betting Facility”) located and

operated within the Casinos. 

You have requested my opinion whether the Consulting Agreements constitute a 

management contract requiring the NIGC Chairman’s approval under the Indian Gaming

Regulatory Act. Additionally, you have requested my opinion whether the agreements violate

IGRA’s requirement that a tribe possess and maintain the sole proprietary interest in its gaming

operation. After careful review, it is my opinion that the Consulting Agreements are not 

management contracts and do not require the approval of the NIGC Chairman. It is also my

opinion that the Consulting Agreements do not violate IGRA’s sole proprietary interest

requirement.
Letter to Ann Hines Davis

Re: Review of Eastern Band of Cherokee Indians Consulting Agreements with American 

Wagering, Inc.: Harrah’s Cherokee Casino and Harrah’s Cherokee Valley River Casino 

March 16, 2021 

Page 2 of 7 

Management Contracts

The NIGC defines management contract to mean “any contract, subcontract, or collateral

agreement between an Indian tribe and a contractor or between a contractor and a subcontractor 

if such contract or agreement provides for the management of all or part of a gaming operation.”1

Collateral agreement is defined as “any contract, whether or not in writing, that is related, either

directly or indirectly, to a management contract, or any rights, duties, or obligations created

between a tribe (or any of its members, entities, or organizations) and a management contractor

or subcontractor (or any person or entity related to a management contractor or subcontractor).”2

While NIGC regulations do not define “management,” the NIGC has clarified that the 

term encompasses activities such as planning, organizing, directing, coordinating, and

controlling.3 A “primary management official” includes “any person who has the authority . . . 

[t]o set up working policy for the gaming operation.”4 Further, management employees are

“those who formulate and effectuate management policies by expressing and making operative 

the decision of their employer.”5 Whether a particular employee is “managerial” is not controlled 

by an employee’s actual job responsibilities, authority, and relationship to management.6

Essentially, an employee may qualify as management if the employee possesses the actual

authority to take discretionary actions – a de jure manager – or, in certain circumstances, where

the employee acts as a de facto manager by directing the gaming operation through others 

possessing actual authority to manage the gaming operation.7

 If a contract requires or permits the performance of any management activity with respect

to all or part of the gaming operation, the contract is a management contract within the meaning

of IGRA and requires the Chair’s approval.8 Management contracts that have not been approved 

by the Chair are void.9

 

1 25 C.F.R. § 502.15. 2 25 C.F.R. § 502.5.

3 See NIGC Bulletin No. 94-5, “Approved Management Contracts v. Consulting Agreements (Unapproved 

Management Contracts are Void).”

4 25 C.F.R. § 502.19(b)(2).

5 N.L.R.B. v. Bell Aerospace Co., 416 U.S. 267, 288 (1974). 6 See Waldau v. M.S.P.B., 19 F.3d 1395, 1399 (Fed. Cir. 1994). 7 Id. at 1399 (citing N.L.R.B. v. Yeshiva, 444 U.S. 672, 683 (1980)). It is uncommon to see de facto management in 

the terms of an agreement, as it is typically an activity that arises in the day-to-day implementation of a consulting 

agreement. If, for example, a tribe is required to make the ultimate decision on whether to accept the advice of a 

consultant, but has no one on staff with the expertise or experience to make such a determination, the consultant may 

become the de facto manager in the sense that the consultant is simply executing management decisions through a 

tribal management official.

8 25 U.S.C. § 2711.

9 25 C.F.R. § 533.7; see also, Wells Fargo Bank, Nat’l Ass’n v. Lake of the Torches Econ. Dev. Corp., 658 F.3d 684, 

688 (7th Cir. 2011).
Letter to Ann Hines Davis

Re: Review of Eastern Band of Cherokee Indians Consulting Agreements with American 

Wagering, Inc.: Harrah’s Cherokee Casino and Harrah’s Cherokee Valley River Casino 

March 16, 2021 

Page 3 of 7 

Management Analysis

The Consulting Agreements specifically prohibit the Consultant from making any

management decisions at either of the Tribe’s Sports Betting Facility(s) or at the Casino, and

state that the Consultant is being engaged “solely in a consulting and advisory capacity.”10 More

specifically, the Agreements state that none of the provisions permit or authorize, nor should 

they be construed to permit or authorize, Consultant to: 

 

(i) operate or manage any gaming conducted at the Casino or the Sports Betting

Facility or to establish the costs of operating or administering the same; (ii) hire,

terminate or determine wages, salaries or benefits for any employee of . . . the 

Sports Betting Facility or the Casino; (iii) establish policies and procedures for the 

operation or management of the Sports Betting Facility or the Casino; (iv) direct

or supervise . . . any other person employed to work at or about the Sports Betting

Facility or Casino regarding the operation or management of the Sports Betting

Facility; (v) bind [Casino] or to act as an agent of [Casino] with regard to the 

operation and management of the Sports Betting Facility; (vi) plan, organize,

direct, coordinate or control any part of any gaming operation within the meaning

of the Indian Gaming Regulatory Act, the regulations promulgated thereunder, or 

case law construing the provisions thereof (“IGRA”); (vii) undertake any other 

activity which constitutes “management” of gaming operations; or (viii) take any

other action that could reasonably be construed as managing or operating the 

Sports Betting Facility or Casino or that would otherwise violate the purpose and

intent of this Agreement.11 

In addition, the Consulting Agreement expressly states that the Tribe “shall have 

complete and absolute discretion with respect to the implementation of Consultant’s advice;

provided, however, that Consultant shall not be liable for [Casino]’s implementation decisions 

that differ from Consultant’s recommendations . . ..”12 (Emphasis added). Further, the Consulting 

Agreement states that the Casino “shall have sole responsibility over the gaming operations of 

the Sports Betting Facility, including, the ultimate authority to set the lines for each game being

wagered on and shall have manual and/or electronic access to do so.”13 (Emphasis added). In

short, while the Tribe will have access to Consultant’s full sports betting menu,14 it is the Tribe

that ultimately decides which games it will or will not accept wagers on, and/or whether or not it

wants to change the lines on a particular game, regardless of Consultant’s recommendations. 

 

10 See Consulting Agreement § 2(b).

11 Id. 12 Id. at § 2(a). 13 Id. at § 2(f). 14 See Exhibit A to Consulting Agreement.


Letter to Ann Hines Davis

Re: Review of Eastern Band of Cherokee Indians Consulting Agreements with American 

Wagering, Inc.: Harrah’s Cherokee Casino and Harrah’s Cherokee Valley River Casino 

March 16, 2021 

Page 6 of 7 

The of net revenue consultation fee is consistent with other sports betting consulting 

fees we see, and the parties have negotiated an arms-length contract. Notably, the net revenue

definition includes . Additionally, sports books are relatively

new additions to tribal gaming, and the Tribe’s facilities will be the first Indian gaming casinos

to offer sports book betting in its region. There is value in being first to market for sports book 

betting. While the is lengthy, it is not in and of itself a concern. For these reasons, 

and given the list of deliverables, the consulting fee does not raise sole proprietary interest

concerns.

Third Party’s Right to Exercise Control over Gaming Activity

The Consulting Agreements do not transfer any exercise of control from the Tribe to

Consultant. Specifically, the Tribe retains control of the gaming operations, and the Tribe “has,

and shall continue to have, the sole proprietary interest in, and ultimate responsibility for, the

Sports Betting Facility and the gaming operations conducted by [the Tribe].”25 In addition, the 

Consulting Agreements state that “[n]othing in this Agreement is intended to grant Consultant 

any proprietary interest in, or responsibility for (i) the Sports Betting Facility or the Casino, [or]

(ii) the gaming operations conducted by [the Tribe],....”26 As set forth above, the Consulting 

Agreements specifically limit Consultant’s role to consulting and advising and list several

activities that Consultant may not perform, including hiring and determining wages of any

employees of the Sports Betting Facility or the Casino. 

Finally, the Consulting Agreements make clear that Consultant is not a joint venturer 

with, or servant, employee, partner or agent of, the Tribe, and that Consultant does not have any

“authority to make commitments of any form or enter into agreements on behalf of the Tribe.”27

Therefore, it is my opinion that the Consulting Agreements, in their present form, do not grant a 

controlling interest in the Tribe’s Casino or Sports Betting Facilities. 

Upon review of these three criteria – term, compensation, and control – it is my opinion 

that the Consulting Agreements does not violate IGRA’s requirement that the Tribe maintain the 

sole proprietary interest in its gaming operation. 

Conclusion

It is my opinion that the Consulting Agreements are not management agreements

requiring the approval of the NIGC Chairman. Additionally, the Consulting Agreements, on their

face, do not violate IGRA’s requirement that the Tribe maintain the sole proprietary interest in its

gaming operation. 

 

25 Consulting Agreement § 4(a). 26 Id. at § 4(b). 27 Id. at § 11(f).

(b) 

(4)

(b) (4) (b) (4)
Letter to Ann Hines Davis

Re: Review of Eastern Band of Cherokee Indians Consulting Agreements with American 

Wagering, Inc.: Harrah’s Cherokee Casino and Harrah’s Cherokee Valley River Casino 

March 16, 2021 

Page 7 of 7 

It is my understanding that the Consulting Agreements are represented to be in

substantially final form with respect to terms affecting this opinion. If such terms change in any

material way prior to closing, or are inconsistent with assumptions made herein, this opinion 

shall not apply. Further, this opinion is limited to the Consulting Agreements. This opinion does 

not include or extend to any other agreements or documents not submitted for review. 

Please note that it is my intent that this letter be released to the public through the 

NIGC’s website. If you have any objection to this disclosure, please provide a written statement 

explaining the grounds for the objection and highlighting the information that you believe should 

be withheld.28 If you object on the grounds that the information qualifies as confidential 

commercial information subject to withholding under Exemption 4 of the Freedom of 

Information Act,29 please be advised that any withholding should be analyzed under the standard 

set forth in Food Marketing Institute v. Argus Leader Media.

30 Any claim of confidentiality 

should also be supported with “a statement or certification by an officer or authorized 

representative of the submitter.”31 Please submit any written objection to 

FOIASubmitterReply@nigc.gov within thirty (30) calendar days of the date of this letter. After 

this time elapses, the letter will be made public and objections will no longer be considered.32 If 

you need any additional guidance regarding potential grounds for withholding, please see the 

United States Department of Justice’s Guide to the Freedom of Information Act at 

http://www.justice.gov/oip/doj-guide-freedom-information-act-0. 

If you have any questions, please contact Maria Getoff, Senior Attorney at (703) 338-

7748. 

Sincerely,

Michael Hoenig 

General Counsel 

 

28 25 C.F.R. § 517.7(c). 29 5 U.S.C. § 552(b)(4). 30 139 S.Ct.2356 (2019). 31 25 C.F.R. § 517.7(d). 32 Id.