Minnesota’s Running Aces Racino Adds More Casinos to RICO Suit

Minnesota harness racing track Running Aces has added two more casinos to a federal racketeering suit that claims tribal operators in the state are running “illegal” games.

Running Aces, Taro Ito, RICO lawsuit, Mystic Lake Casino, Little Six Casino, Shakopee
Running Aces president and CEO Taro Ito, above, says that all he wants to do is compete on a level playing field. But tribal interests dismissed his lawsuit as a stunt to designed to “mislead the public” and “influence the legislature.” (Image: The Business Journals)

Last month, the Columbus, Minn.-based racino sued the Grand Casino Hinckley, Grand Casino Mille Lacs, and Treasure Island Resort. Running Aces claims they conduct class III card games that are not covered by their tribal-state gaming compacts, such as Three Card Poker and Ultimate Texas Hold’Em.

The Grand Casinos are owned by the Mille Lacs Band of Ojibwe. Treasure Island belongs to the Prairie Island Indian Community.

In an amended complaint filed Tuesday, Running Aces added Mystic Lake and Little Six Casinos, which are owned by the Shakopee Mdewakanton Sioux Community (SMSC).

‘IGRA Violated’

The racino accuses all five casinos of violating the Indian Gaming Regulatory Act (IGRA), as well as state laws, by operating not only class III card games but also “video games of chance,” such as slots.

The tribes are permitted by the state to offer these games under the terms of their compacts. Minnesota was the first state to sign compacts with its federally recognized tribes after the enactment of IGRA in 1988.

Many feel lawmakers blundered by failing to negotiate revenue-sharing provisions. The state is not permitted to renegotiate any of these compacts without the tribes’ approval.

But the Minnesota criminal code “specifically prohibits and makes illegal the playing of electronic video games of chance for any person,” as the lawsuit notes.

This is something the tribes “know only too well,” per the lawsuit. When Running Aces applied to Minnesota Racing Commission to “modestly expand its ‘dealer assist’ table games,” the SMSC objected on the grounds that “video games of chance are not permitted in Minnesota,” the suit states.

‘No Merit’

“All that we have ever sought was to be treated fairly, compete on a level playing field, take advantage of improvements within the pari-mutuel environment, and operate without fear of being eliminated,” Running Aces president and CEO Taro Ito said in a statement to local CBS affiliate KSTP-TV. “It is our sincere desire to have our day in court and let the facts determine the outcome.”

But the SMSC dismissed the Running Aces lawsuit as having “no merit,” labeling it a “desperate stunt to attack the good reputation of tribes and tribal gaming” in a statement to FOX 9.

All gaming conducted at Mystic Lake and Little Six Casinos complies with tribal law, federal law, and the gaming compact that was executed in 1989,” read the statement.

The SMSC claims Running Aces is seeking to “mislead the public and influence the final stages of the Minnesota Legislature’s 2024 session,” to prevent the passage of a bill that would hand a sports betting monopoly to the tribes.

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Kyle Kirkland, Owner of California Cardroom, Running to Succeed US Rep. Kevin McCarthy

California businessman Kyle Kirkland is running for Congress to succeed US Rep. Kevin McCarthy (R-California). McCarthy officially departed Congress effective Dec. 31 after he was shockingly removed as House Speaker last October.

Kyle Kirkland California cardroom casino
Kyle Kirkland in 2020 poses for a photograph at his Club One Casino in Fresno. Kirkland is running for Congress by way of California to succeed former US Rep. Kevin McCarthy’s seat. (Image: The Business Journal)

Kirkland owns Club One Casino in Fresno, a cardroom that primarily runs poker games. The Central California gaming facility features 51 table games, a 24-hour restaurant, and three bars.

A Republican, Kirkland is among what’s becoming a crowded field for McCarthy’s 20th Congressional District seat. One of the reddest parts of the state, the current field includes McCarthy’s hand-picked successor, state Assemblyman Vince Fong (R-Bakersfield).

Fong wants to run for both state reelection and Congress. A state Superior Court judge last month said Fong can conduct dual campaigns, though California Secretary of State Shirley Weber says she’ll appeal the decision through the state Courts of Appeal.

Kirkland says he watched the Fong controversy play out and decided to throw his hat into the pool.

Political Newcomer

Before buying Club One Casino in February 2008, Kirkland enjoyed a lengthy career in the music industry. He served as chairman of Steinway Musical Instruments for 18 years, the longest tenure for someone not named Steinway.

Asked why he decided to enter politics despite a successful business career in music and gaming, Kirkland said he’s long had an interest in government and lawmaking.

I felt like this was an opportunity for a noncareer politician to get involved,” Kirkland told Ray Appleton on his KMJ Now News Talk Radio podcast. “I certainly see the issues people are facing and concerned about — the economy, border crisis, unanswered crime. If there was ever a time where Congress needed new thinking and someone who is action-oriented and looking for change, it’s now.”

Kirkland says he’s on the ballot for the 2024 primary on March 5.

Kirkland told Appleton that the economy and high costs of living are his top two priorities. He believes his business experience makes him more qualified to handle such complex topics than career politicians who have never been responsible for people’s jobs and livelihoods.

Club One Casino, he says, is a large taxpayer that “employs a lot of people.” The California Gaming Association, which Kirkland is president, says the Golden State’s cardroom industry generates more than 32,000 jobs a year and almost $5.6 billion a year in economic activity.

McCarthy Downfall

McCarthy officially exited DC on Dec. 31 following 17 years in Congress.

After some in his party agreed to oust him as Speaker last fall for him agreeing to work with Democrats to avoid a government shutdown, McCarthy said he would depart the Capitol. McCarthy plans to help GOP political newcomers seek and win office.

“I have decided to depart the House … to serve America in new ways,” McCarthy wrote in The Wall Street Journal. “I will continue to recruit our country’s best and brightest to run for elected office. The Republican Party is expanding every day, and I am committed to lending my experience to support the next generation of leaders.”

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