Have you heard the one about the meeting planner who, when trying to plan an event at a Native American casino, found herself confused by unfamiliar tax laws and tribal compacts, treated coolly by the casino's marketing department, and forced to use nonunion labor in a decidedly union town? Or how about the man who, in a business dispute, had $250,000 of his own equipment confiscated by a Native American nation? He sued to reclaim it in state court and won, but still couldn't retrieve the equipment because Native American nations aren't subject to U.S. state laws.
These scenarios aren't jokes. They're the real experiences of people caught in the legal penumbra of doing business with Native American nations. "The horror stories are really unbelievable," says I. Nelson Rose, law professor at Costa Mesa, CA-based Whittier Law School and a leading expert in gaming law. "Once, there was a company that was building a gas pipeline across Indian land when the tribe changed its mind in the middle of the process. And there was nothing the company could do."
Even so, for meeting planners looking to hold events at casinos, considering the Native American option is convenient. "Our contracts are exactly the same as those of non-Indian casinos," says Foxwoods' Joan Esnault, executive director of resort sales. "There really isn't any difference in the way we work with meeting planners." Esnault says Foxwoods even charges the same 12-percent tax as other businesses in the state (except Foxwoods' tax goes to the Mashantucket Pequot tribal infrastructure rather than to Connecticut).
Nearly 350 Indian casinos operate in 28 states with overall gross revenues of more than $14 billion, figures that are all set to rise further. But given that Native American reservations are sovereign nations, meaning they -- and their casinos -- aren't subject to the laws or taxes of their host states, planning a meeting or event on Native American still can have its share of idiosyncrasies. There is no single set of laws for such lands. Rather, each nation runs its own independent entity, with its own government and infrastructure. Furthermore, each nation's relationship with its host state is determined in individually negotiated agreements called compacts. This widespread inconsistency makes it easy to see why some planners hesitate to use Native American casinos.
Sixteen years after Congress passed the Indian Gaming Regulatory Act, the legality of holding meetings on Indian lands is still ambiguous. "The problem is that lawyers do not know this area," says Rose. "Nobody cared about this before the tribes had casino hotels. But now, it's a growing area of law, and it's amazing how many mistakes are made." The good news: "Indian casinos are standardizing," Rose says. "They're beginning to be run more like businesses and less like governments." And this means planners can adopt a strategy to successfully negotiate a thorough and enforceable contract for events at Native American gaming destinations.
the Big Guns
The Native American gaming industry's biggest players, Connecticut's Foxwoods Resort and Casino, the largest casino in the world, and Mohegan Sun, have the longest histories of working with meeting groups. Though owned and operated by the Mashantucket Pequot and Mohegan tribes, respectively, both gaming behemoths offer planners contracts and services essentially identical to their non-Native American counterparts. For example, Mohegan Sun, although not required to, "adheres to the state of Connecticut guidelines," according to Keith Sexton-Patrick, director of convention services. "It's in our best interest for everybody to see that we are being fair," says Sexton-Patrick. "We have a reason to exist beyond just profits. Our main purpose is the perpetuation of the Mohegan tribe."
Planners agree that organizing events there is not difficult. "It was absolutely outstanding," says Carol Buchanan, meeting planner for Montvale, NJ-based Benjamin Moore, who recently held an event at Mohegan Sun. "Though it is clearly a Native American casino, you'd never know it. It's not like there are certain rules that they make you adhere to that other places don't. It's just a phenomenal, well-oiled machine." And although neither venue is especially clear about under which authority -- state or tribal -- any possible lawsuit might be heard, both Mohegan Sun and Foxwoods say they've never had a dispute with a planner they couldn't resolve before it escalated to litigation.
Craft the Contract
The important thing to remember is that whether dealing with colossal casinos or smaller, lesser-known venues, any ambiguities can be eliminated during the contract phase. At Mt. Pleasant, MI-based Soaring Eagle Casino and Resort, a AAA Four Diamond property owned by the Saginaw Chippewa tribe, with 21,000 square feet of meeting space, catering and conventions manager Bob Van Wert admits, "The different jurisdictions aren't really outlined in the contracts." He adds, "In our history we've not had to go outside [the tribe] to resolve any disputes." That means one of three things: There haven't been any serious disputes; the tribe's never gone outside its own judicial system because it has solved whatever problems came up; or it hasn't gone outside because, as a sovereign nation, it doesn't have to.
"As I see it, there are probably two major issues for planners to watch out for," Whittier Law School's Rose says. The first is the contract itself. "It's very important for planners to get an explicit waiver of sovereign immunity." The waiver of sovereign immunity means that the tribe agrees that it can be sued in a United States court of law. Rose further recommends that the waiver of immunity also include reference to where any arbitration will be heard (specifically, state court). This eliminates the unpleasant possibility of having no recourse in potential disputes other than the tribal courts, which can be difficult to navigate for anyone other than counsel from that particular tribe. Although it seems that many planners fail to include this clause -- Foxwoods' Esnault recalls only one planner ever asking for one -- Rose says it's not only a fair request but also a wise one. "The sophisticated tribe understands that they do this or they don't get the business," he says.
The waiver of sovereign immunity is also important for insurance purposes. Without the waiver, tribes cannot be sued under tort laws -- including wrongful death -- but meeting planners always can be. "The safest way is to require that the tribe has insurance and that it explicitly waives its sovereign immunity if someone tries to collect," Rose says, recalling a case in which the nation had insurance but the insurance company "raised a defense of sovereign immunity by stepping into the shoes of the insured." Even if that claim wouldn't hold up in court, because the insurance company was a non-Indian entity, it would make for a long and expensive legal process.
ask away
Finally, it always pays to ask as many questions up front as possible. Because tribes are exempt from state tax laws, "They can, in fact, pretty much tax whatever they want," Rose says. By the same token, nations are not required to recognize otherwise tax-exempt organizations. So planners would be well advised to clearly delineate all tax-related issues in the contract. Furthermore, not all Native American casinos serve liquor. Kathleen Loesch, who plans meetings for Volkswagen, recently held an event at Lakeside, CA's Barona Valley Ranch Resort and Casino, near San Diego, and had to bring her own liquor to the casino. "That was weird, but it worked out, no problem," she says. But another planner, who asked not to be named, says that a brewery exhibiting at a trade show she held at an Indian property could not hand out free samples as planned because "it was against that tribe's rules to give out free beer."
Still, Native American casinos are often fascinating alternatives to the standard gambling destinations. Such casinos offer unique historical and cultural experiences in the incomparable settings of Native American reservations. And many still include the benefits of dealing with small operations. "We'd definitely have meetings there again," says Volkswagen's Loesch of the Barona casino. "It was much easier without all the red tape of the larger casinos."