by Antho­ny Cruz1Antho­ny Cruz is a J.D. Can­di­date (2022) at New York Uni­ver­si­ty School of Law. This piece is a com­men­tary on the 6th Annu­al Frank A. Schreck Gam­ing Law Moot Court Com­pe­ti­tion. The issue in the prob­lem con­cerned whether the fic­ti­tious Boyd Gam­ing Con­trol Board and Com­mis­sion (mod­eled after those of Neva­da) can revoke a gam­ing license for an individual’s pri­vate med­ical mar­i­jua­na use.

For many gam­ing com­mis­sions across the Unit­ed States, mar­i­jua­na remains off-lim­its despite local and state laws that have allowed for legal mar­i­jua­na. In many of those same states, gam­bling oper­a­tors are licensed with the require­ment that they com­ply with state, local, and fed­er­al law.2 See, e.g., Nev. Gam­ing Reg. 5.011(8) (explain­ing that “[f]ailure to com­ply with or make pro­vi­sion for com­pli­ance with all fed­er­al, state and local laws and reg­u­la­tions” con­sti­tutes grounds for revok­ing a gam­ing license). There are often rel­e­vant con­flicts between state and fed­er­al law. The Con­trolled Sub­stances Act3 21 U.S.C. § 801. is a fed­er­al law that par­ti­tions con­trolled sub­stances and oth­er nar­cotics into sched­ules and pro­vides for means of enforce­ment and reg­u­la­tion. All state laws legal­iz­ing mar­i­jua­na are pre­empt­ed by the Con­trolled Sub­stances Act.4 See Gon­za­lez v. Raich, 545 U.S. 1 (2005) (hold­ing that the Con­trolled Sub­stances Act pre­empts California’s statute legal­iz­ing mar­i­jua­na under Congress’s Com­merce Clause pow­er). To date, six­teen states have legal­ized mar­i­jua­na for adults over 21 and 36 states have legal­ized mar­i­jua­na for med­ical rea­sons.5 Jere­my Berke, et. al., Mar­i­jua­na Legal­iza­tion Is Sweep­ing the U.S. See Every State Where Cannabis Is Legal, Bus. Insid­er (Apr. 14, 2021), https://www.businessinsider.com/legal-marijuana-states-2018–1#:~:text=Since%202012%2C%2016%20states%20and,marijuana%2C%20whether%20medically%20or%20recreationally. The ques­tion remains whether state gam­ing boards and com­mis­sions, as crea­tures of the state leg­is­la­ture, can pro­mul­gate rules that man­date com­pli­ance with a fed­er­al law that con­flicts with the laws of the leg­is­la­ture that cre­at­ed the gam­ing boards and com­mis­sions in the first place.

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In May 2014, as mar­i­jua­na dis­pen­saries were begin­ning to receive licens­es, the Neva­da Gam­ing Com­mis­sion cir­cu­lat­ed notice #2014–39.6Notice, State of Nev. Gam­ing Con­trol Bd., Notice #2014–39, (May 6, 2014), https://gaming.nv.gov/modules/showdocument.aspx?documentid=8874. That mem­o­ran­dum estab­lish­es an unequiv­o­cal demar­ca­tion between the gam­ing and cannabis indus­tries, pro­hibit­ing any­one with a gam­ing license from par­tic­i­pat­ing in Nevada’s mar­i­jua­na indus­try unless fed­er­al law changed.7 Id. Sim­i­lar­ly, in Col­orado, the Lim­it­ed Gam­ing Con­trol Com­mis­sion added reg­u­la­tions on Sep­tem­ber 20, 2018 to pre­clude any­one involved in the mar­i­jua­na indus­try from obtain­ing a Col­orado gam­ing license.8 Colo. Ltd. Gam­ing Con­trol Comm’n, Res­o­lu­tion of the Col­orado Lim­it­ed Gam­ing Con­trol Com­mis­sion Regard­ing Mar­i­jua­na and Gam­ing, (Sept. 20, 2018), https://www.colorado.gov/pacific/sites/default/files/Signed%20Resolution%20Gaming%20Licensees%20and%20Marijuana.pdf. Colorado’s Res­o­lu­tion specif­i­cal­ly prohibits

hold[ing] or obtain[ing] a mar­i­jua­na license; … contract[ing] with or maintain[ing] busi­ness rela­tion­ships with … indi­vid­u­als, enti­ties, or estab­lish­ments involved in the sale, cul­ti­va­tion, or dis­tri­b­u­tion of mar­i­jua­na; … and receiv[ing] financ­ing from or provid[ing] financ­ing to indi­vid­u­als, enti­ties, or estab­lish­ments that sell, cul­ti­vate, or dis­trib­ute mar­i­jua­na.9 Id.

What’s more, the Res­o­lu­tion puts the onus on gam­ing licensees to do the nec­es­sary due dili­gence to ensure they are in com­pli­ance with fed­er­al law.10 Id.

Giv­en the prece­dent set by states like Neva­da and Col­orado, oth­er states with legal­ized mar­i­jua­na and gam­bling hubs will like­ly fol­low suit. While it may be too ear­ly to tell what the amal­gam of gam­ing and cannabis use will look like, indus­try experts and pub­lic offi­cials sus­pect an adher­ence to the Neva­da rule—the log­ic being that marijuana’s ille­gal­i­ty under fed­er­al law presents “sig­nif­i­cant chal­lenges to bank­ing laws, anti-mon­ey laun­der­ing pro­vi­sions and employ­ee pro­tec­tions.”11 David Danzis, Don’t Bet on High Times in Atlantic City Casi­nos When Mar­i­jua­na Is Legal, Atl. City Press (Dec. 13, 2020), https://pressofatlanticcity.com/news/local/dont-bet-on-high-times-in-atlantic-city-casinos-when-marijuana-is-legal/article_e0341079-d8c8-59e9-b063-cf6a1b639c3e.html. Because casi­nos and banks are con­sid­ered finan­cial insti­tu­tions by the Finan­cial Crimes Enforce­ment Net­work arm of the Unit­ed States Trea­sury, cannabis-relat­ed streams of rev­enue can­not flow through, or finance, tra­di­tion­al bank­ing and casi­no oper­a­tions.12 See Secure and Fair Enforce­ment Bank­ing Act of 2019, H.R. 1595, 116th Cong. § 1 (2019). How­ev­er, the House of Rep­re­sen­ta­tives recent­ly passed the SAFE Bank­ing Act, which would immu­nize dis­po­si­tions of cannabis relat­ed funds by finan­cial insti­tu­tions.13 See Cia­ra Lin­nane, Cannabis Stocks Ral­ly Pre­mar­ket After House Pass­es SAFE Bank­ing Act, Mar­ket Watch (Apr. 20, 2021), https://www.marketwatch.com/story/cannabis-stocks-rally-premarket-after-house-passes-safe-banking-act-2021–04-20. Until the SAFE Bank­ing Act and sim­i­lar leg­is­la­tion is enact­ed, casi­no exec­u­tives and reg­u­la­tors in states like New Jer­sey remain con­cerned that one’s cannabis relat­ed activ­i­ties in one juris­dic­tion would impact their gam­ing qual­i­fi­ca­tions in oth­er juris­dic­tions where mar­i­jua­na is not legal.14 See Danzis, supra note 10. The SAFE Bank­ing Act would sur­gi­cal­ly address the hur­dles affect­ing cannabis com­pa­nies’ access to financ­ing with­out legal­iz­ing cannabis at the fed­er­al lev­el.15 See Gus­tav Stick­ley V, The SAFE Bank­ing Act: A Rea­son­able and Nar­row­ly Tai­lored Approach to Address­ing Pub­lic Safe­ty Con­cerns and Lack of Finan­cial Ser­vices in Today’s Cannabis Indus­try, JD Supra (Jul. 8, 2021), https://www.jdsupra.com/legalnews/the-safe-banking-act-a-reasonable-and-2393575/.

The imme­di­ate impli­ca­tions of the prob­lem go beyond the legal ones—the eco­nom­ic and polit­i­cal ram­i­fi­ca­tions of states’ con­tin­ued asceti­cism will have wide-reach­ing con­se­quences for smok­ers, casi­no exec­u­tives, tourists, and casi­no patrons. While the Biden Admin­is­tra­tion has relaxed fed­er­al pros­e­cu­tion of mar­i­jua­na con­sump­tion, nation­wide legal­iza­tion remains elu­sive.16 See Ger­man Lopez, Biden’s Blunt Oppo­si­tion to Mar­i­jua­na Legal­iza­tion, Vox (Apr. 16, 2021, 12:50 PM), https://www.vox.com/22387746/biden-marijuana-weed-legalization-schumer-polls. Giv­en the expan­sion of mar­i­jua­na legal­iza­tion (most recent­ly in four states as a result of the 2020 elec­tion) the futures of cannabis and gam­ing are like­ly to be very much inter­twined.17 See Bruce Y. Lee, 4 States Vote to Legal­ize Recre­ation­al Mar­i­jua­na Use: Ari­zona, Mon­tana, NJ, South Dako­ta, Forbes (Nov. 4, 2020, 10:38 AM), https://www.forbes.com/sites/brucelee/2020/11/04/4‑states-vote-to-legalize-recreational-marijuana-use-arizona-montana-nj-south-dakota/?sh=1cfcbbc0558f. Met­ro­pol­i­tan cen­ters with gam­ing like Las Vegas are see­ing increased tourist attrac­tion because of legal mar­i­jua­na.18 See Mark Lugris, Las Vegas is Bet­ting on Pot Tourism as the New Trend in Trav­el, The Trav­el (Sept. 20, 2019), https://www.thetravel.com/las-vegas-is-betting-on-pot-tourism-as-the-new-trend-in-travel/. State gam­ing reg­u­la­tors and oth­er stake­hold­ers remain keen on pre­serv­ing their auton­o­my in the sphere and their dis­cre­tionary pow­ers regard­ing gam­ing. Ulti­mate­ly, this Con­tri­bu­tion argues that states should avoid enforc­ing or pro­mul­gat­ing reg­u­la­tions that lead to over­ly strin­gent restric­tions on casi­no licensees con­cern­ing their pri­vate mar­i­jua­na usage, espe­cial­ly if they are oth­er­wise in accor­dance with state and local laws and protocols.

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The issue of intra-state fed­er­al­ism is para­mount to unrav­el­ing the Con­trolled Sub­stances Act’s strong­hold over local gam­ing com­mis­sions in the face of con­tra­ven­ing man­dates from state leg­is­la­tures. Courts will have to adju­di­cate the legal­i­ty of a state-cre­at­ed entity’s deci­sion to favor fed­er­al law over the con­flict­ing law of the state in which the enti­ty sits.

It is an open ques­tion whether state agen­cies are behold­en to the Con­trolled Sub­stances Act. There are Tenth Amend­ment issues impli­cat­ed by any state agency’s claim that it must con­tra­vene state law to uphold fed­er­al law as “[t]he pow­ers not del­e­gat­ed to the Unit­ed States by the Con­sti­tu­tion, nor pro­hib­it­ed by it to the states, are reserved to the states respec­tive­ly, or to the peo­ple.”19 U.S. Con­st. amend. X. There may also be latent anti-com­man­deer­ing issues with a state agency tak­ing it upon itself to uphold a fed­er­al reg­u­la­to­ry scheme.20 See Printz v. Unit­ed States, 521 U.S. 898, 935 (1997) (hold­ing that fed­er­al statutes can­not force states or state offi­cials to enact or enforce a fed­er­al reg­u­la­to­ry gun con­trol mea­sure); see also Va. Off. for Prot. & Advoc. v. Stew­art, 563 U.S. 247, 257–58 (2011) (hold­ing that a state can­not be said to have con­sent­ed to suit by an in-state agency just because that state agency receives fed­er­al funds and car­ries out a fed­er­al statute that cares for the indi­vid­ual states’ dis­abled). In the admin­is­tra­tive law con­text out­side of gam­ing, it has been a well-set­tled prin­ci­ple in sev­er­al states that enforce­ment actions can­not depart from the pri­or­i­ties and poli­cies under­scor­ing the state statute.21 See, e.g., E & T Real­ty v. Strick­land, 830 F.2d 1107, 1111 (11th Cir. 1987) (dis­cussing prin­ci­ple under Alaba­ma law); Mal­one v. Fend­er, 385 A.2d 929, 932 (N.J. Super. Ct. App. Div. 1978) (hold­ing that a state agency’s rul­ing in con­tra­ven­tion of state law will not be enforced). With these back­ground norms in mind, one can­not with­out a mod­icum of dif­fi­cul­ty square the aims of sev­er­al states’ leg­is­la­tures in legal­iz­ing marijuana—to pro­mote eco­nom­ic vital­i­ty and to make up bud­get gaps caused by the COVID-19 virus22 See Nick Reis­man, How Cuo­mo Wants to Spend Legal Mar­i­jua­na Rev­enue, Spec­trum News (Feb. 16, 2021 8:39 AM), https://www.ny1.com/nyc/all-boroughs/ny-state-of-politics/2021/02/16/how-cuomo-wants-to-spend-legal-marijuana-revenue.—with gam­ing com­mis­sions’ attempts to ban any type of mar­i­jua­na usage near casi­nos.23 See, e.g., Nev. Cannabis Com­pli­ance Bd., Study on Neva­da Cannabis Con­sump­tion Lounges, (Jan. 1, 2021), https://ccb.nv.gov/wp-content/uploads/2021/02/CCB-Cannabis-Consumption-Lounge-Study-FINAL.pdf (explain­ing that cannabis smok­ing lounges must be at least 1500 feet from any gam­ing establishment).

The uncer­tain­ty aris­ing from the ques­tion is mud­dled even fur­ther if one con­sid­ers that state mar­i­jua­na laws may not be direct­ly pre­empt­ed despite the hold­ing in Raich. Oklahoma’s Supreme Court recent­ly upheld the state’s abil­i­ty to demo­c­ra­t­i­cal­ly amend the Okla­homa Con­sti­tu­tion in order to legal­ize, reg­u­late, and tax mar­i­jua­na.24 See Tay v. Kiesel (In re State Ques­tion No. 807, Ini­tia­tive Peti­tion No. 423), 468 P.3d 383, 389 (Okla. 2020) (hold­ing that because the Unit­ed States Supreme Court has not direct­ly addressed the pre­emp­tion issue, the state courts are able to make their inde­pen­dent deter­mi­na­tion free from Suprema­cy Clause obsta­cles). The Okla­homa Supreme Court posit­ed that the fed­er­al gov­ern­ment sim­ply does not have the abil­i­ty to force states to enforce the Con­trolled Sub­stances Act or to crim­i­nal­ize it with­in their bor­ders and there­fore, states like Okla­homa are free to reg­u­late cannabis as they see fit.25 Id. at 391.

Regard­less of the mer­its of a par­tic­u­lar deci­sion by a gam­ing com­mis­sion to grant or revoke a gam­ing license, it is clear that leg­is­la­tures invari­ably grant their gam­ing com­mis­sions lee­way in enforce­ment. For instance, accord­ing to the Neva­da Revised Statutes, the Com­mis­sion has “full and absolute pow­er and author­i­ty to … lim­it, con­di­tion … restrict … revoke or sus­pend any license.”26 See Nev. Rev. Stat. § 463.1405. It is clear the Neva­da leg­is­la­ture intend­ed to give the Com­mis­sion broad dis­cre­tion in both grant­i­ng and rescind­ing gam­ing licenses.

The com­mon law in Neva­da like­wise sup­ports the propo­si­tion that the Neva­da Gam­ing Board and Com­mis­sion have flex­i­bil­i­ty in inter­pret­ing and enforc­ing their statutes. The Supreme Court of Neva­da in State v. Rosen­thal held that the Neva­da Gam­ing Com­mis­sion had broad pow­ers and there were only lim­it­ed cir­cum­stances for appro­pri­ate judi­cial intru­sion.27 See State v. Rosen­thal, 559 P. 2d 830, 836 (Nev. 1977) (“We view gam­ing as a mat­ter reserved to the states with­in the mean­ing of the Tenth Amend­ment . . . . With­in this con­text we find no room for fed­er­al­ly pro­tect­ed con­sti­tu­tion­al rights. This dis­tinc­tive­ly state prob­lem is to be gov­erned, con­trolled and reg­u­lat­ed by the state leg­is­la­ture and . . . the Neva­da Con­sti­tu­tion.”). In Rosen­thal, the Neva­da Gam­ing Com­mis­sion did not cite to any crim­i­nal con­vic­tions in Neva­da or to any alleged crim­i­nal behav­ior in Neva­da when the Com­mis­sion revoked Mr. Rosenthal’s gam­ing license. The Com­mis­sion only had evi­dence that Mr. Rosen­thal vio­lat­ed a law in North Car­oli­na, and it was only alleged that Mr. Rosen­thal vio­lat­ed a fed­er­al law and Flori­da state law.28 Id. at 833.

Draw­ing from a robust field of admin­is­tra­tive law, gam­ing com­mis­sions are agents of the leg­is­la­ture that cre­at­ed them; ergo, they should be giv­en due def­er­ence when inter­pret­ing state gam­bling statutes and rules they them­selves pro­mul­gat­ed. As the Supreme Court held in Mead: “Admin­is­tra­tive imple­men­ta­tion of a par­tic­u­lar statu­to­ry pro­vi­sion qual­i­fies for [the great­est lev­el of def­er­ence accord­ed under Chevron] when it appears that Con­gress del­e­gat­ed author­i­ty to the agency gen­er­al­ly to make rules car­ry­ing the force of law .…”29 Unit­ed States v. Mead Corp., 533 U.S. 218, 226–27 (2001). Of course, whether or not each indi­vid­ual state with legal­ized gam­ing has a state com­mon law ana­logue of the Chevron doc­trine is a state-depen­dent inquiry.

Neva­da has fur­ther estab­lished by statute that the bur­den of prov­ing one’s qual­i­fi­ca­tions for a gam­ing license falls square­ly on the licensee.30 See Nev. Gam­ing Reg. 5.030 (“It is the respon­si­bil­i­ty of the licensee to keep him­self informed of the con­tent of all such reg­u­la­tions, and igno­rance there­of will not excuse vio­la­tions.”).The leg­is­la­ture of Neva­da has also made their inten­tions clear that the Neva­da Gam­ing Com­mis­sion is free to strict­ly enforce its reg­u­la­tions so as to main­tain pub­lic con­fi­dence and trust in gam­ing.31 See Nev. Rev. Stat. § 463.0129(c) (“Pub­lic con­fi­dence and trust can only be main­tained by strict reg­u­la­tion of all per­sons, loca­tions, prac­tices, asso­ci­a­tions and activ­i­ties relat­ed to the oper­a­tion of licensed gam­ing establishments . . . .”).

How­ev­er, even if the gen­er­al pur­pose of the leg­is­la­ture was to empow­er the Gam­ing Com­mis­sion and Board, these admin­is­tra­tive bod­ies are still bound by the rules they set for them­selves and for gam­ing licensees. The fact that the state leg­is­la­tures went out of their way to enu­mer­ate spe­cif­ic trig­gers for vio­lat­ing fed­er­al law pre­cludes gam­ing reg­u­la­tors from cit­ing fed­er­al law gen­er­al­ly as a rea­son to rule against a licensee. Accord­ing to the applic­a­ble gam­ing reg­u­la­tions in Neva­da, gam­ing licensees must not be in vio­la­tion of state, local, and fed­er­al laws that per­tain to the “oper­a­tions of a licensed estab­lish­ment includ­ing … pay­ment of all license fees, with­hold­ing any pay­roll tax­es, liquor and enter­tain­ment tax­es and antitrust and monop­oly statutes.”32 Nev. Gam­ing Reg. 5.011(8). These enu­mer­a­tions seem to spec­i­fy what the per­ti­nent state, local, and fed­er­al laws are. The pay­ment of pay­roll and liquor tax­es as well as com­pli­ance with antitrust laws sug­gest that sub­sec­tion 8 should be read to man­date sub­mis­sion to com­mer­cial fed­er­al admin­is­tra­tive schemes that gov­ern the con­duct of businesses—not nec­es­sar­i­ly laws that gov­ern pri­vate or indi­vid­ual behav­ior like pri­vate med­ical mar­i­jua­na use. Thus, the Con­trolled Sub­stances Act seems not to be impli­cat­ed at first glance. The lan­guage in the Neva­da gam­ing reg­u­la­tions may be fur­ther clar­i­fied by sub­se­quent­ly enact­ed legislation—specifically, state laws that pro­tect employ­ees from ter­mi­na­tion because of their med­ical mar­i­jua­na use.33 Assemb. B. 132, 2019 Leg., 80th Sess. (Nev. 2019).

Regard­less of the text’s plain mean­ing, the Neva­da Gam­ing Com­mis­sion “in the exer­cise of its sound dis­cre­tion can make its own deter­mi­na­tion of whether or not the licensee has failed to com­ply” with Neva­da Gam­ing Reg­u­la­tion 5.011(8), but any such deter­mi­na­tion is bound by “estab­lished prece­dents” in inter­pret­ing the gam­ing reg­u­la­tions.34 Nev. Gam­ing Reg. 5.011(8).

Even if the Neva­da Gam­ing Com­mis­sion is free to apply rules harsh­ly, “estab­lished prece­dents” in Neva­da and in Col­orado seem to sug­gest a notable lev­el of tol­er­ance for those who use med­ical mar­i­jua­na pri­vate­ly or are involved with the mar­i­jua­na indus­try off casi­no premis­es. A relaxed con­struc­tion of gam­ing reg­u­la­tions that seek to sep­a­rate out mar­i­jua­na from gam­ing would like­ly mean that gam­ing com­mis­sions should take on a holis­tic process in review­ing appli­ca­tions. An exam­ple of this holis­tic review process at work comes from a 2018 issue of Neva­da Gam­ing Lawyer.35 See Ter­ry John­son, High States: Bal­anc­ing Gam­ing Reg­u­la­tion and Mar­i­jua­na, Nev. Gam­ing Law. (Sept. 2018), https://www.nvbar.org/wp-content/uploads/7‑Gaming-Regulation-and-Marijuana.pdf. Accord­ing to Neva­da Gam­ing Com­mis­sion­er Ter­ry John­son, “[d]uring the appli­ca­tion process [for a gam­ing licensee look­ing to expand their gam­ing oper­a­tions], it was deter­mined that an appli­cant had obtained a reg­istry iden­ti­fi­ca­tion card for pur­pos­es of the med­ical use of mar­i­jua­na.” After a hear­ing dur­ing which the appli­cant was asked about the valid­i­ty of their med­ical pre­scrip­tion, the like­li­hood that the appli­cant was engaged in illic­it crim­i­nal activ­i­ty, and per­haps most impor­tant­ly, whether or not the appli­cant had ever used, pos­sessed, or been impaired by mar­i­jua­na while at or run­ning the casi­no, the Neva­da Gam­ing Board unan­i­mous­ly rec­om­mend­ed licen­sure and the Com­mis­sion unan­i­mous­ly approved.36 Id.In this case, the Neva­da Gam­ing Com­mis­sion was able to bal­ance the vot­er-appro­bat­ed pub­lic pol­i­cy of mar­i­jua­na legal­iza­tion with the pub­lic poli­cies con­cern­ing the strict reg­u­la­tions on gam­ing officials.

In Col­orado, the coro­n­avirus pan­dem­ic hit the gam­ing indus­try espe­cial­ly hard.37See Chris­tine Ric­cia­r­di, Colorado’s Fur­loughed Casi­no Employ­ees Now Eli­gi­ble for Fast-track Hire Into Mar­i­jua­na Indus­try, Dai­ly Cam­era (Apr. 6, 2021, 3:37 PM), https://www.dailycamera.com/2020/04/06/colorado-casinos-marijuana-coronvavirus/ (“Gov. Jared Polis closed all Col­orado casi­nos by exec­u­tive order on March 17 to mit­i­gate the spread of the nov­el coro­n­avirus, caus­ing wide­spread fur­loughs through­out gam­bling towns Black Hawk, Cen­tral City and Crip­ple Creek.”).To mit­i­gate the dele­te­ri­ous effects of the casi­no clo­sures, the Mar­i­jua­na Enforce­ment Divi­sion adopt­ed emer­gency rules to allow casi­no employ­ees to move over into the cannabis indus­try since casi­no employ­ees under­go back­ground checks sim­i­lar to work­ers in the mar­i­jua­na dis­pen­sary busi­ness.38 Id. This arrange­ment is the prod­uct of con­ver­sa­tions between both the Mar­i­jua­na Enforce­ment Divi­sion and Col­orado gam­ing reg­u­la­tors.39 Id.

The afore­men­tioned exam­ples go to show that the oppo­si­tion by gam­ing com­mis­sions to cannabis is ground­ed most­ly in con­cerns regard­ing cross invest­ments between the gam­bling and cannabis indus­tries. Invest­ment rela­tion­ships and financ­ing are called out explic­it­ly by the Neva­da Gam­ing Com­mis­sion.40 Haley N. Lewis, Note, Unlike­ly Con­se­quences: How Med­ical Mar­i­jua­na Is Affect­ing Nevada’s Gam­ing Indus­try, 6 UNLV Gam­ing L.J. 299, 307 (2016) (“[T]he [NGCB] does not believe invest­ment or any oth­er involve­ment in a med­ical mar­i­jua­na facil­i­ty or estab­lish­ment by a per­son who has received a gam­ing approval . . . is con­sis­tent with the effec­tive reg­u­la­tion of gam­ing.”) (inter­nal quotes omit­ted). In 2014, the Neva­da Gam­ing Com­mis­sion even ruled that a com­pa­ny that man­u­fac­tured gam­ing devices could not trans­act with a restau­rant own­er to install slot machines on his busi­ness premis­es because the owner’s spouse had a minor­i­ty share in a mar­i­jua­na busi­ness, demon­strat­ing the pri­ma­cy of finan­cial con­cerns.41 Har­ry Arnold, Com­ment, When Your Black­jack Deal­er Takes a Hit: How Neva­da Assem­bly Bill 132 Threat­ens Vegas Casi­nos in an Age of Legal­ized Mar­i­jua­na, 28 Geo. Mason L. Rev. 449, 459 (2020).

* * * * *

A final issue that deserves atten­tion is whether or not the infor­mal res­o­lu­tions and ad-hoc notices dis­sem­i­nat­ed by gam­ing com­mis­sions effec­tu­ate pol­i­cy and car­ry the force of law. Issues of this nature are extreme­ly state-depen­dent and most like­ly turn on whether or not each indi­vid­ual state has enact­ed some­thing akin to the fed­er­al Admin­is­tra­tive Pro­ce­dure Act.42 See 5 U.S.C. § 553 (2006) (§ 553(b) and § 553(c) of which requires fed­er­al exec­u­tive agen­cies to allow for notice and an oppor­tu­ni­ty for pub­lic com­ment pri­or to any offi­cial rule­mak­ing can take effect).

Although peo­ple employed by casi­nos may have med­ical mar­i­jua­na pre­scrip­tions, it is not nec­es­sar­i­ly the case that they auto­mat­i­cal­ly fall under the reg­u­la­to­ry umbrel­la of the local gam­ing com­mis­sion. This is espe­cial­ly true when the state has by statute cre­at­ed a cannabis com­pli­ance board to do just that—operationalize and man­age the licen­sures of med­ical and recre­ation­al mar­i­jua­na facil­i­ties.43 See, e.g., N.J. Stat. § 24:6I-44(k) (2021) (“Any cannabis or cannabis item may be trans­port­ed or deliv­ered, con­sis­tent with the require­ments set forth in this sec­tion and reg­u­la­tions pro­mul­gat­ed by the com­mis­sion, to any loca­tion in the State. . . . [I]n no case may a munic­i­pal­i­ty restrict the trans­porta­tion or deliv­er­ies of cannabis items to con­sumers with­in that munic­i­pal­i­ty by adop­tion of a munic­i­pal ordi­nance or any oth­er mea­sure, and any restric­tion to the con­trary shall be deemed void and unen­force­able.”). For instance, the Neva­da Cannabis Com­pli­ance Board is charged with part­ner­ing with local and state offi­cials on cannabis relat­ed mat­ters.44 Nev. Cannabis Com­pli­ance Bd., FY 2022–2023 Bien­ni­um Bud­get Request, (Mar. 12, 2021), https://www.leg.state.nv.us/App/NELIS/REL/81st2021/ExhibitDocument/OpenExhibitDocument?exhibitId=48550&fileDownloadName=Nevada%20Cannabis%20Compliance%20Board_Presentation.pdf. It would seem unrea­son­able to neglect these admin­is­tra­tive bod­ies’ pow­ers sim­ply because there may be over­lap­ping juris­dic­tions between the cannabis reg­u­la­tors and the gam­ing regulators.

* * * * *

As a pol­i­cy mat­ter, states should not seek to unrav­el a vot­er approved admin­is­tra­tive scheme out of an abun­dance of cau­tion when doing so does not help gam­ing reg­u­la­tors pro­tect the pub­lic con­fi­dence or trust in gam­ing. Over­reach­ing and expan­sive read­ings of state statutes grant­i­ng gam­ing com­mis­sions pow­er to dis­ci­pline gam­ing licensees can actu­al­ly serve to frus­trate the devel­op­ment of a vibrant and robust cannabis mar­ket. State gam­ing com­mis­sions dis­ci­plin­ing gam­ing licensees for pri­vate med­ical mar­i­jua­na use is an exer­cise of reg­u­la­to­ry over­sight that was most like­ly meant for oth­er agen­cies estab­lished by the state, not gam­ing com­mis­sions.45 This com­ment should not be read to imply that indi­vid­u­als who are intox­i­cat­ed by a con­trolled sub­stance while work­ing at a gam­ing estab­lish­ment may escape dis­ci­pli­nary actions by the per­ti­nent gam­ing boards. More­over, the cloud of uncer­tain­ty that state agen­cies work under when apply­ing dif­fer­ent stan­dards of con­flict­ing laws makes the argu­ment for cir­cum­scribed enforce­ment stronger. In oth­er words, the state agency when con­front­ed with a state and fed­er­al law con­flict with hazy pre­emp­tion impli­ca­tions, should not act in a man­ner that is con­trary to the state legislature’s intent. Final­ly, “estab­lished prece­dent,” vague­ly pro­mul­gat­ed notices, and sub­se­quent state leg­is­la­tion cre­at­ing cannabis com­pli­ance com­mis­sions with their own statu­to­ry pow­ers may cumu­la­tive­ly give effect to a casi­no employee’s ultra vires claims if a gam­ing board cites a med­ical mar­i­jua­na reg­is­tra­tion card as suf­fi­cient grounds to take away that employee’s livelihood.


  • 1
    Antho­ny Cruz is a J.D. Can­di­date (2022) at New York Uni­ver­si­ty School of Law. This piece is a com­men­tary on the 6th Annu­al Frank A. Schreck Gam­ing Law Moot Court Com­pe­ti­tion. The issue in the prob­lem con­cerned whether the fic­ti­tious Boyd Gam­ing Con­trol Board and Com­mis­sion (mod­eled after those of Neva­da) can revoke a gam­ing license for an individual’s pri­vate med­ical mar­i­jua­na use.
  • 2
    See, e.g., Nev. Gam­ing Reg. 5.011(8) (explain­ing that “[f]ailure to com­ply with or make pro­vi­sion for com­pli­ance with all fed­er­al, state and local laws and reg­u­la­tions” con­sti­tutes grounds for revok­ing a gam­ing license).
  • 3
    21 U.S.C. § 801.
  • 4
    See Gon­za­lez v. Raich, 545 U.S. 1 (2005) (hold­ing that the Con­trolled Sub­stances Act pre­empts California’s statute legal­iz­ing mar­i­jua­na under Congress’s Com­merce Clause power).
  • 5
    Jere­my Berke, et. al., Mar­i­jua­na Legal­iza­tion Is Sweep­ing the U.S. See Every State Where Cannabis Is Legal, Bus. Insid­er (Apr. 14, 2021), https://www.businessinsider.com/legal-marijuana-states-2018–1#:~:text=Since%202012%2C%2016%20states%20and,marijuana%2C%20whether%20medically%20or%20recreationally.
  • 6
    Notice, State of Nev. Gam­ing Con­trol Bd., Notice #2014–39, (May 6, 2014), https://gaming.nv.gov/modules/showdocument.aspx?documentid=8874.
  • 7
    Id.
  • 8
    Colo. Ltd. Gam­ing Con­trol Comm’n, Res­o­lu­tion of the Col­orado Lim­it­ed Gam­ing Con­trol Com­mis­sion Regard­ing Mar­i­jua­na and Gam­ing, (Sept. 20, 2018), https://www.colorado.gov/pacific/sites/default/files/Signed%20Resolution%20Gaming%20Licensees%20and%20Marijuana.pdf.
  • 9
    Id.
  • 10
    Id.
  • 11
    David Danzis, Don’t Bet on High Times in Atlantic City Casi­nos When Mar­i­jua­na Is Legal, Atl. City Press (Dec. 13, 2020), https://pressofatlanticcity.com/news/local/dont-bet-on-high-times-in-atlantic-city-casinos-when-marijuana-is-legal/article_e0341079-d8c8-59e9-b063-cf6a1b639c3e.html.
  • 12
    See Secure and Fair Enforce­ment Bank­ing Act of 2019, H.R. 1595, 116th Cong. § 1 (2019).
  • 13
    See Cia­ra Lin­nane, Cannabis Stocks Ral­ly Pre­mar­ket After House Pass­es SAFE Bank­ing Act, Mar­ket Watch (Apr. 20, 2021), https://www.marketwatch.com/story/cannabis-stocks-rally-premarket-after-house-passes-safe-banking-act-2021–04-20.
  • 14
    See Danzis, supra note 10.
  • 15
    See Gus­tav Stick­ley V, The SAFE Bank­ing Act: A Rea­son­able and Nar­row­ly Tai­lored Approach to Address­ing Pub­lic Safe­ty Con­cerns and Lack of Finan­cial Ser­vices in Today’s Cannabis Indus­try, JD Supra (Jul. 8, 2021), https://www.jdsupra.com/legalnews/the-safe-banking-act-a-reasonable-and-2393575/.
  • 16
    See Ger­man Lopez, Biden’s Blunt Oppo­si­tion to Mar­i­jua­na Legal­iza­tion, Vox (Apr. 16, 2021, 12:50 PM), https://www.vox.com/22387746/biden-marijuana-weed-legalization-schumer-polls.
  • 17
    See Bruce Y. Lee, 4 States Vote to Legal­ize Recre­ation­al Mar­i­jua­na Use: Ari­zona, Mon­tana, NJ, South Dako­ta, Forbes (Nov. 4, 2020, 10:38 AM), https://www.forbes.com/sites/brucelee/2020/11/04/4‑states-vote-to-legalize-recreational-marijuana-use-arizona-montana-nj-south-dakota/?sh=1cfcbbc0558f.
  • 18
    See Mark Lugris, Las Vegas is Bet­ting on Pot Tourism as the New Trend in Trav­el, The Trav­el (Sept. 20, 2019), https://www.thetravel.com/las-vegas-is-betting-on-pot-tourism-as-the-new-trend-in-travel/.
  • 19
    U.S. Con­st. amend. X.
  • 20
    See Printz v. Unit­ed States, 521 U.S. 898, 935 (1997) (hold­ing that fed­er­al statutes can­not force states or state offi­cials to enact or enforce a fed­er­al reg­u­la­to­ry gun con­trol mea­sure); see also Va. Off. for Prot. & Advoc. v. Stew­art, 563 U.S. 247, 257–58 (2011) (hold­ing that a state can­not be said to have con­sent­ed to suit by an in-state agency just because that state agency receives fed­er­al funds and car­ries out a fed­er­al statute that cares for the indi­vid­ual states’ disabled).
  • 21
    See, e.g., E & T Real­ty v. Strick­land, 830 F.2d 1107, 1111 (11th Cir. 1987) (dis­cussing prin­ci­ple under Alaba­ma law); Mal­one v. Fend­er, 385 A.2d 929, 932 (N.J. Super. Ct. App. Div. 1978) (hold­ing that a state agency’s rul­ing in con­tra­ven­tion of state law will not be enforced).
  • 22
    See Nick Reis­man, How Cuo­mo Wants to Spend Legal Mar­i­jua­na Rev­enue, Spec­trum News (Feb. 16, 2021 8:39 AM), https://www.ny1.com/nyc/all-boroughs/ny-state-of-politics/2021/02/16/how-cuomo-wants-to-spend-legal-marijuana-revenue.
  • 23
    See, e.g., Nev. Cannabis Com­pli­ance Bd., Study on Neva­da Cannabis Con­sump­tion Lounges, (Jan. 1, 2021), https://ccb.nv.gov/wp-content/uploads/2021/02/CCB-Cannabis-Consumption-Lounge-Study-FINAL.pdf (explain­ing that cannabis smok­ing lounges must be at least 1500 feet from any gam­ing establishment).
  • 24
    See Tay v. Kiesel (In re State Ques­tion No. 807, Ini­tia­tive Peti­tion No. 423), 468 P.3d 383, 389 (Okla. 2020) (hold­ing that because the Unit­ed States Supreme Court has not direct­ly addressed the pre­emp­tion issue, the state courts are able to make their inde­pen­dent deter­mi­na­tion free from Suprema­cy Clause obstacles).
  • 25
    Id. at 391.
  • 26
    See Nev. Rev. Stat. § 463.1405.
  • 27
    See State v. Rosen­thal, 559 P. 2d 830, 836 (Nev. 1977) (“We view gam­ing as a mat­ter reserved to the states with­in the mean­ing of the Tenth Amend­ment . . . . With­in this con­text we find no room for fed­er­al­ly pro­tect­ed con­sti­tu­tion­al rights. This dis­tinc­tive­ly state prob­lem is to be gov­erned, con­trolled and reg­u­lat­ed by the state leg­is­la­ture and . . . the Neva­da Constitution.”).
  • 28
    Id. at 833.
  • 29
    Unit­ed States v. Mead Corp., 533 U.S. 218, 226–27 (2001).
  • 30
    See Nev. Gam­ing Reg. 5.030 (“It is the respon­si­bil­i­ty of the licensee to keep him­self informed of the con­tent of all such reg­u­la­tions, and igno­rance there­of will not excuse violations.”).
  • 31
    See Nev. Rev. Stat. § 463.0129(c) (“Pub­lic con­fi­dence and trust can only be main­tained by strict reg­u­la­tion of all per­sons, loca­tions, prac­tices, asso­ci­a­tions and activ­i­ties relat­ed to the oper­a­tion of licensed gam­ing establishments . . . .”).
  • 32
    Nev. Gam­ing Reg. 5.011(8).
  • 33
    Assemb. B. 132, 2019 Leg., 80th Sess. (Nev. 2019).
  • 34
    Nev. Gam­ing Reg. 5.011(8).
  • 35
    See Ter­ry John­son, High States: Bal­anc­ing Gam­ing Reg­u­la­tion and Mar­i­jua­na, Nev. Gam­ing Law. (Sept. 2018), https://www.nvbar.org/wp-content/uploads/7‑Gaming-Regulation-and-Marijuana.pdf.
  • 36
    Id.
  • 37
    See Chris­tine Ric­cia­r­di, Colorado’s Fur­loughed Casi­no Employ­ees Now Eli­gi­ble for Fast-track Hire Into Mar­i­jua­na Indus­try, Dai­ly Cam­era (Apr. 6, 2021, 3:37 PM), https://www.dailycamera.com/2020/04/06/colorado-casinos-marijuana-coronvavirus/ (“Gov. Jared Polis closed all Col­orado casi­nos by exec­u­tive order on March 17 to mit­i­gate the spread of the nov­el coro­n­avirus, caus­ing wide­spread fur­loughs through­out gam­bling towns Black Hawk, Cen­tral City and Crip­ple Creek.”).
  • 38
    Id.
  • 39
    Id.
  • 40
    Haley N. Lewis, Note, Unlike­ly Con­se­quences: How Med­ical Mar­i­jua­na Is Affect­ing Nevada’s Gam­ing Indus­try, 6 UNLV Gam­ing L.J. 299, 307 (2016) (“[T]he [NGCB] does not believe invest­ment or any oth­er involve­ment in a med­ical mar­i­jua­na facil­i­ty or estab­lish­ment by a per­son who has received a gam­ing approval . . . is con­sis­tent with the effec­tive reg­u­la­tion of gam­ing.”) (inter­nal quotes omitted).
  • 41
    Har­ry Arnold, Com­ment, When Your Black­jack Deal­er Takes a Hit: How Neva­da Assem­bly Bill 132 Threat­ens Vegas Casi­nos in an Age of Legal­ized Mar­i­jua­na, 28 Geo. Mason L. Rev. 449, 459 (2020).
  • 42
    See 5 U.S.C. § 553 (2006) (§ 553(b) and § 553(c) of which requires fed­er­al exec­u­tive agen­cies to allow for notice and an oppor­tu­ni­ty for pub­lic com­ment pri­or to any offi­cial rule­mak­ing can take effect).
  • 43
    See, e.g., N.J. Stat. § 24:6I-44(k) (2021) (“Any cannabis or cannabis item may be trans­port­ed or deliv­ered, con­sis­tent with the require­ments set forth in this sec­tion and reg­u­la­tions pro­mul­gat­ed by the com­mis­sion, to any loca­tion in the State. . . . [I]n no case may a munic­i­pal­i­ty restrict the trans­porta­tion or deliv­er­ies of cannabis items to con­sumers with­in that munic­i­pal­i­ty by adop­tion of a munic­i­pal ordi­nance or any oth­er mea­sure, and any restric­tion to the con­trary shall be deemed void and unenforceable.”).
  • 44
    Nev. Cannabis Com­pli­ance Bd., FY 2022–2023 Bien­ni­um Bud­get Request, (Mar. 12, 2021), https://www.leg.state.nv.us/App/NELIS/REL/81st2021/ExhibitDocument/OpenExhibitDocument?exhibitId=48550&fileDownloadName=Nevada%20Cannabis%20Compliance%20Board_Presentation.pdf.
  • 45
    This com­ment should not be read to imply that indi­vid­u­als who are intox­i­cat­ed by a con­trolled sub­stance while work­ing at a gam­ing estab­lish­ment may escape dis­ci­pli­nary actions by the per­ti­nent gam­ing boards.