Texas Poker Rooms Threatened by Bill to Amend Legal Code on Gambling

Posted on: November 22, 2022, 02:26h. 

Last updated on: November 22, 2022, 03:30h.

Philip Conneller @casinoorgphilc Read More
Expertise: Gaming Business, Regulation, Tribal Gaming.

A bill filed in the Texas legislature would close an alleged loophole in the state’s penal code that has spawned a thriving poker club scene in cities throughout the state.

Texas State Rep. Jean Wu
Texas State Rep. Jean Wu, above, claims the Texas Penal Code intended to permit private home games and not “private” commercial enterprises, like the Texas Card House. (Image: Houston Chronicle)

State Rep. Gene Wu (D-Houston) says his bill would clarify a gray area of the law and force the clubs to close permanently.

The so-called loophole — or, more accurately, defense against prosecution used by the clubs — relates to the definition of the term “private place,” or lack thereof.

Chapter 47 of the Texas Penal Code states: “It is a defense to prosecution [for gambling]” if “the actor engaged in gambling [is] in a private place; no person received any economic benefit other than personal winnings; [and] except for the advantage of skill or luck, the risks of losing and the chances of winning were the same for all.”

The poker rooms claim that they are private clubs. They say they don’t act as the house because they don’t take a rake. Instead, customers pay by the hour to be at the venue.

Private Enterprise

Wu’s bill would amend the term “private place” to “private residence.” This would exclude “streets, highways, restaurants, taverns, nightclubs, schools, hospitals, and the common areas of apartment houses, hotels, motels, office buildings, transportation facilities, and shops,” according to the bill.

“These legal defenses were written to allow for legal private gaming in the state without authorizing commercial operations,” Wu told The Dallas Observer. “In recent years, these defenses have been used to create private poker clubs that attempt to operate within their language, while creating for-profit gaming enterprises.

Since it is likely that creating a licensing process to regulate these clubs is not politically achievable in our current Legislature, we believe that clarifying the law in this manner is the only way to eliminate the confusion around these clubs,” Wu added.

Dallas’ first “legal” poker club, The Texas Card House, entered a lease agreement in December 2019 and received city-issued certification in October 2020. In January 2022, it suddenly received notice that it was “keeping a gambling place.” The city revoked the club’s permit 15 months after it had signed it off.

It seems Dallas City Attorney Chris Caso had decided there was a change of plan.

Clubs Prepare to Fight Back

Last month, a Dallas County Court judge upheld city officials’ decision to revoke the club’s license of occupancy, forcing it to close. The club has asked the court for a stay of execution.

Meanwhile, the club’s owner, Ryan Crow, told The Dallas Observer he’s working with other poker rooms to establish an association to fight challenges from Wu and others.

We have a couple of bills we plan to submit as well and, of course, we’re going to be talking to representatives about [Wu’s] and hopefully making sure it doesn’t pass,” he said.

“That bill would put thousands of people out of a job … and also push tens of thousands of poker players back underground into illegal games,” he added. “So, hopefully, we can get that message to the legislators and they agree it’s not a good idea to push that bill through.”