to an oral hearing and instead elect to have the matter determined by the NIGC solely on the basis
of the written submissions.

4
DATED this {I Day of August, 1999.

Medel

MONTEE R. DEER, Chairman
National Indian Gaming Commission
4h
DATED this || Day of August, 1999.
ipa 0 Orauige

TODD J(ARAUIO, S¢AF Attorney
National Indian Gaming Commission


NOTICE OF VIOLATION
Ref. No.: NOV-99-10
August 11, 1999
To: Herbert Whittish
Chairman
Shoalwater Bay Indian Tribe
Tokeland, Washington 98590

The Chairman of the National Indian Gaming Commission (“NIGC”) hereby gives notice that
the Shoalwater Bay Indian Tribe (hereafter referred to as “Tribe” or “Respondent”), located in
Tokeland, Washington is in violation of the Indian Gaming Regulatory Act (“IGRA”) and NIGC
regulations.’

1. Background

The Respondent is a federally recognized Indian Tribe with tribal headquarters located in
Tokeland, Washington. The Respondent operates the Shoalwater Bay Bingo and Casino facility
(“Casino”) located at Highway 105 and Old Tokeland Road, Tokeland, Washington, 98590. The
Casino is located on the Shoalwater Bay Indian Reservation, on lands held in trust by the United
States for the benefit of the Shoalwater Bay Indian Tribe. The lands are considered “Indian lands”
as that term is defined in IGRA. See 25 U.S.C. § 2703(4). The Respondent operates class III gaming
at its Casino. The Respondent does not have a Tribal-State compact with the State of Washington
allowing for the operation of class I gaming.

2. The circumstances of the violation are as follows:

IGRA creates three classes of gaming which differ in the degree of tribal, state, and federal
oversight. Class I gaming consists of “social games [played] solely for prizes of minimal value or
traditional forms of Indian gaming engaged in by individuals as part of, or in connection with, tribal
ceremonies or celebrations.” 25 U.S.C. § 2703(6). Class II gaming includes bingo, related activities,
and certain non-banking card games. 25 U.S.C. § 2703(7{A). IGRA specifically excludes any

‘NIGC regulations are set forth in Chapter II], Title 25, Parts 500-599 of the Code of
Federal Regulations. All sections of NIGC regulations cited in this Notice Of Violation refer to
the pertinent parts of Title 25. NIGC regulations implement provisions of the IGRA.


banking card games from classification as a class I game. 25 U.S.C. § 2703(7)(B). Class I gaming
is defined as “all forms of gaming that are not class I gaming or class II gaming.” 25 U.S.C. §
2703(8). Pursuant to NIGC regulations, class III gaming specifically includes (but is not limited to)
any slot machines as defined in 15 U.S.C. § 1171(a){1) and electronic or electromechanical facsimiles”
of any game of chance. See 25 C.F. R § 502.4. Class Il gaming activities are permissible on Indian
lands only if such activities are “conducted in conformance with a Tribal-State compact entered into
by the Indian tribe and the State... .” 25 U.S.C. § 2710(d)(1)(C).

Operation of Class Ill Gambling Devi

From approximately March 12, 1998, through the date of the issuance of this Notice of
Violation, the Respondent has operated the Shoalwater Bay Bingo and Casino facility on Indian lands
located in Tokeland, Washington. During this period, the Respondent offered the following class II
gambling devices: (1) Native Treasures; (2) Catch a Dream; (3) Sheriff's Round Up; (4) Pirate’s
Loot; and (5) American Game Technology Cash Key Video gaming devices.

The machines identified above are gambling devices as defined under 15 U.S.C. § 1171(a),
and therefore, fall within the definition of class Il gaming. See 25 CF.R. § 502.4. Class III gaming
activities are lawful on Indian lands only if such activities are “conducted in conformance with a
Tribal-State compact entered into by the Indian tribe and the State... .” 25 U.S.C. § 2710(d)(1)(C).
A compact is in effect only when “notice of approval by the Secretary [of the Interior] of such
compact has been published by the Secretary in the Federal Register.” 25 U.S.C. § 2710(d)(3)(B).
The Respondent has not entered into a compact with the State of Washington and there has been no
official approval of any compact and no publication in the Federal Register. Therefore, the
Respondent is operating such class III gambling devices in the absence of a Tribal-State compact in
violation of 25 U.S.C. § 2710(d). Additionally, the operation of class III gaming activities in the
absence of a compact constitutes a “substantial” violation under NIGC regulations. See 25 C.F.R.
§ 573.6(11).

Operation of Class I Card and Table Games
During the relevant time period, the Respondent also offered other forms of class III gaming,

including the following banked’ games: (1) pai gow poker, (2) blackjack; and (3) roulette. NIGC
regulations define all banking games as class IMI gaming. See 25 C.F.R. 502.4(a). The types of pai

?An electronic or electromechanical facsimile means any gambling device as defined in 15
U.S.C. § 1171(a)(2) or (3). See 25 CFR. § 502.8.

>Banking games, as commonly understood and as defined in NIGC regulations, are
games in which the banker (usually the house) takes on, that is, competes against, all players,
collecting from losers and paying winners. See 25 C.F.R. § 502.11. Conversely, non-banking
card games are games where players play against each other. Poker is the typical example of a
non-banking card game.


gow poker and blackjack identified in the instant action are banking “card” games, therefore, both
pai gow poker and blackjack qualify as class III gaming. Moreover, NIGC regulations specifically
define both pai gow poker and blackjack (if played as banking games) as class II gaming. See 25
CFR § 502.4(a)(1). NIGC regulations also specifically define roulette as class III gaming. See 25
C.F.R. § 502.4(a)(2). Once again, the Respondent is operating class III games (pai gow poker,
blackjack and roulette) in the absence of a Tribal-State compact in violation of 25 U.S.C. § 2710(d).
Additionally, the operation of class II gaming activities in the absence of a compact constitutes a
“substantial” violation. See 25 C.F.R. § 573.6(11).

3. The measures required to correct the violation:

The Respondent is to immediately cease and desist from the operation of all class III games
within its Casino facility.

4. Fine-Submission of Information

The violations cited in this NOV may result in the assessment of civil fines against the
Respondent in an amount not to exceed $25,000 per violation per day. The Respondent may submit
written information about the violations to the NIGC Chairman within 15 days after service of this
NOV (or such longer period as the NIGC Chairman may grant for good cause). See 25 C.F.R. §
575.5(a). The NIGC Chairman shall consider any information submitted in determining the facts
surrounding the violations and the amount of the civil fine, if any. Such information should be
submitted to the National Indian Gaming Commission, 1441 L Street NW, Suite 9100, Washington,
D.C. 20005.

5. Notice of rights of appeal:

The Respondent may appeal the allegations contained in this NOV to the NIGC within 30 -
days after service of this NOV. See 25 C.F.R. Part 577. The Respondent may appeal the allegations
by submitting a NOTICE OF APPEAL to the National Indian Gaming Commission, 1441 L Street
NW, 9th Floor, Washington, D.C. 20005. The Respondent has a right to be represented by counsel:
in such an appeal. A NOTICE OF APPEAL must reference this NOV. Within ten (10) days after
filing 2a NOTICE OF APPEAL, the Respondent shall file with the NIGC a supplemental statement
that states with particularity the relief desired and the grounds therefore and includes, when available,
supporting evidence in the form of affidavits.

If the Respondent wishes to present oral testimony or witnesses at a hearing, the Respondent
must include a request to do so with the supplemental statement. The request to present oral
testimony must specify the names of the proposed witnesses and the general nature of their expected
testimony, and whether a closed hearing is requested and why. The Respondent may waive the right