517 U.S. 44 (1996), argued 11 Oct. 1995, decided 27 Mar. 1996 by vote of 5 to 4; Rehnquist for the Court, Stevens, Souter, Ginsburg, and Breyer in dissent. In the 1980s several states rushed to raise revenues by authorizing casino gambling. Perhaps nowhere was the impact of the gambling fever greater than on the lands of Native Americans. By 1995 casino gambling generated more than $4 billion a year in business, with 200 tribes operating 126 casinos in 24 states. In the midst of this rush to gold, Congress in 1988 passed the Indian Gaming Regulatory Act, which permitted tribes to operate gambling casinos, required states to negotiate with tribes, and allowed tribes to file lawsuits in federal courts when they alleged the states failed to negotiate in good faith. The act was a response to a 1987 high court decision, California v. Cabazon Band of Mission Indians, which held that the states could not bar high-payoff bingo games on reservations.
Under the act tribes were able to sponsor a wide variety of gambling activities, but only in states that permitted them to do so. The law directed the states and the tribes to negotiate in good faith and to devise “tribal-state compacts” to regulate gambling. The response to the new law was at once more gambling and greater conflict between some tribes and the states, since many states took the position that they would allow on the tribal reservations only those games of chance, such as slot machines, approved for the state as whole.
Nowhere was the conflict greater than in Florida. That state's governor, Lawton Chiles, opposed casino gambling, doing so before and after a statewide vote rejected a proposal to establish casino gambling. Governor Chiles did agree that the Seminoles could offer card games and raffles on their reservations, as well as wagering on racing and jai alai, activities already approved by the state. When Chiles refused to negotiate with the Seminole tribe over casino gambling, the tribe took him into federal court, charging that he had failed to exercise good faith. The Court of Appeals for the Eleventh Circuit ultimately decided that Congress lacked the authority to force the states to negotiate with the tribes. In reaching this opinion, the court of appeals pointed to the Eleventh Amendment, which provided that a state could not be sued without its consent. Hence, what began as an issue involving the right of Native Americans to operate casinos became transformed into a major dispute over the nature of federalism and states’ rights.
In its appeal to the high court, Florida was joined by thirty-one other states, all of whom feared that should the Indian Gaming Act stand, Congress would be able in other areas, such as the environment, business practices, health, and safety, to erode their sovereign authority. In arguing before the justices, counsel for Florida insisted that the gaming law directly commanded the states to do certain things in such a way that made them mere subdivisions of the national government.