Tribe Under Investigation For Efforts To Block Competing Oregon Casinos

One tribe’s effort to protect its Oregon gambling territory is under federal investigation. The US Department of Justice is conducting a preliminary probe into the Cowlitz Indian Tribe, assessing the possibility of federal antitrust laws.

The Cowlitz tribe operates Ilani Casino Resort, located outside La Center, Wash.

The Washington casino is one of the most successful in the northwest because of its proximity to Portland. So much so that the tribe has paid out thousands of dollars to block competing casinos from opening nearby, per the Oregonian.

Why the Cowlitz tribe is under investigation

According to the Oregonian, meeting records show the Cowlitz tribe is “eager” to cooperate with the investigation. Tribal leaders and officials have been meeting once a week.

In turn, leaders of the tribe agreed to turn over emails from David Barnett. Barnett, the tribe’s former chair, was instrumental in the tribe’s acquisition of the land and opening of the casino. The Oregonian adds that the tribe will give officials the casino’s financial and mark share data to aid the investigation.

The tribe paid gaming consultants Matthew Rossman and Bruce Studer, of R&S Strategy Group, $30,000 and $50,000 a month to help block competing casinos in the Portland area.

However, Rossman and Studer attempted to build their own casino in the area. Ultimately, the non-tribal casino plans fell through. According to the Oregonian, tribal officials questioned the need to pay the consultants since their efforts didn’t pan out.

The contract with the two gave the Cowlitz Tribe the right of first refusal for any casino operators to build, according to the Oregonian. Tribal leaders terminated the agreement in October.

Tribe knew of potential antitrust lawsuits

The Oregonian states that one person involved in the latest meeting shared that the tribe knew of the possibility of an antitrust lawsuit during the fall.

Antitrust laws are in place to discourage monopolies. Essentially, they prohibit businesses from fixing or divvying up markets.

The Oregonian’s report estimates that the Ilani casino generates roughly $300 million in gambling revenue annually. Being in the coveted area near Portland plays a significant role.

State law limits Oregon casinos to 1 per tribe

The idea of other tribes starting casinos near Portland is hardly tangible. Oregon law states that each tribe can operate a single casino within their reservation. The closest tribe to the area – the Grand Ronde Tribe – is roughly 60 miles away. New legislation is needed for this law to change.

And that law isn’t likely to differ any time soon. Newly elected Gov. Tina Kotek said she doesn’t tout plans to expand tribal gaming, much like former Gov. Kate Brown.

Other attempts to build Oregon casinos

Oregon’s Coquille Tribe wants to build a casino in Medford. It currently operates the Mill Casino Hotel & RV Park in North Bend. Under this plan, the tribe would renovate its Roxy Ann Lanes into a Class II gaming facility.

The Coquille Tribe attempted to do this in 2020 but failed. John Tahsuda, the principal deputy assistant secretary of Indian affairs, cited the tribe’s distance between its reservation and the proposed trust land as the main issue. He called the 170-mile difference a “jurisdictional problem.”

Tribes want legislative changes

The Confederated Tribes of Siletz Indians currently operates the Chinook Winds Casino and Resort in Lincoln City. They’re going forward with plans for another casino just north of Salem, near I-5, despite no change in legislation.

The same goes for the Grand Ronde. The tribe owns and operates the Spirit Mountain Casino. That casino’s revenue dropped by 20% after the opening of the Cowlitz’s Ilani Casino Resort. In turn, the Grand Ronde announced plans to build a second casino in Wood Village.

It’s worth noting that Rossman and Studer – the two individuals contracted with the Cowlitz Tribe – also planned their failed casino proposal in Wood Village.