Sault Ste. Marie Tribe Of Chippewa Indians v. Granholm

475 F.3d 805 (6th Cir. 2007)

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Nature Of The Case

This section contains the nature of the case and procedural background.

Facts

The purpose of the IGRA was to 'provide a statutory basis for the operation of gaming by Indian tribes as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments.' Ps began engaging in negotiations with D to enter into an agreement that would govern the operation of class III games (slot machines) on the Tribes' native lands. Ps eventually filed suit alleging that D refused to negotiate gaming compacts as was required by the IGRA. The parties reached an agreement with respect to that claim, which was memorialized in a Stipulation and incorporated into a Consent Judgment. The district court retained jurisdiction to enforce the Consent Judgment. Ps agreed to 'make semi-annual payments to any local unit of state government in the immediate vicinity of each tribal casino in the aggregate amount equal to two percent (2%) of the net win at each casino derived from all class III electronic games of chance.' 'Net win' was defined as the total amount wagered on each electronic game of chance, minus the total amount paid to players for winning wagers at said machines. P began producing and distributing promotional tokens, which were good for a free play on the promotional slot machines. These QuickSilver tokens were given to customers completely free of charge. They could only be used while playing the QuickSilver slot machines. The tokens themselves could not be redeemed for real money. The QuickSilver machines paid out real money: One 'credit' on a QuickSilver machine was denoted as a quarter, and the machines paid quarters to patrons when they won. P valued QuickSilver tokens at twenty-five cents. P afforded them a dollar value in promotional ads. The Consent Judgment made no mention of how the casino should calculate net win with respect to promotional wagers, and a dispute arose over how to value the promotional tokens when calculating net win. D argued that they should be valued at twenty-five cents, but P valued them as a zero-cent wager. The money won by patrons on these machines was reflected in the net win calculus. P's practice of assigning the tokens a zero-cent value resulted in these machines necessarily producing a net loss. Because net wins are calculated across the entire floor of a casino and not on a machine-by-machine basis, this method of calculation lowered P's overall profits and, accordingly. D filed a Motion to Enforce the Stipulation and Consent Judgment. P argued that the tokens need not correspond to a monetary amount to have value, in that the value of the QuickSilver tokens was that they were worth one chance to win a quarter. P attempted to introduce extrinsic evidence that showed that within the gaming industry, there is a way of understanding wagers that have no monetary value. P claimed the concept of 'wager' is latently ambiguous when applied within the context of this industry. D claimed the term 'wager' is unambiguous, and that the common sense definition of a wager contemplates a monetary value, and that the monetary value of these coins was twenty-five cents. The court held that the term was unambiguous and refused to consider P's extrinsic evidence. It held that since P valued the tokens at twenty-five cents each in their ads, the court granted D's motion and ordered P to pay $1,027,378.00 (plus interest). P appealed.

Issues

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Holding & Decision

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Legal Analysis

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