Madawaska First Nation Wins Dispute With Province Over Video Gambling Profits

Written By Jose Colorado on January 31, 2023
court sides with madawaska first nation over casino video gambling profits

The Madawaska Maliseet First Nation has won big.

New Brunswick’s top court has ordered the province to pay the band government 95% of Grey Rock Casino’s profits from its video gambling machines. Grey Rock Casino sits on the reserve’s land.

The New Brunswick Lotteries and Gaming Corporation initially argued it had no legal obligation to share the revenue. Instead, it insisted it was a policy decision that involved “various social and economic factors.”

The New Brunswick Court of Appeal said otherwise on Jan.12 with its ruling:

“The Gaming Commission does not have the residual discretion it claims, and Madawaska ought to be paid its share of the net profit for the video gaming devices at the casino.”

Province, Madawaska First Nation head to court again

Last year, the Madawaska First Nation and the province went to court over the same matter.

In that instance, a Court of King’s Bench said the band fulfilled all requirements to be covered by the revenue-sharing provision of the law.

Regardless, New Brunswick decided to appeal.

Justice Raymond French, Ernest Drapeau and Charles LeBlond heard the case this time. But they remained unmoved by the province’s argument.

To that end, French — who wrote the ruling in the most recent case — concluded the commission failed to identify the social and economic factors that would involve a discretionary decision.

Province tries to muddy definition of video gaming devices

The term “video gaming devices” also came under examination.

According to the province — in the legislation, video gaming devices only referred to Atlantic Lottery Corporation machines previously used at the casino. As a result, they argued for the exclusion of the cabinets currently in operation at the casino.

Justice French rejected that notion.

The ruling is significant as court documents show video gaming devices prove lucrative. For instance, Madawaska pulled in $1.8 million — through its 95% share cut — in 2015.

However, things changed once the casino opened on the reserve. It is alleged the gaming corporation decreased its payments during this time. Notably, in 2018, profits dropped to less than $10,000 after ALC removed all its machines.

Madawaska lawyer: This was a straightforward decision

All things considered, Nick Kennedy – the lawyer representing Madawaska – wasn’t exactly sweating the result.

“We said, and courts at both levels accepted, that that meant New Brunswick was required to share its gaming profits from the Grey Rock Casino with Madawaska. So, in our view it was very straightforward.”

Beyond the court ruling, Madawaska First Nations and the province are in another feud.

This one centres around a retail tax agreement with the province set to expire this Tuesday.

Nonetheless, Kennedy said the tax and gambling deals are separate matters. That means they won’t impact one another regardless of the outcome.

First Nations win big in Saskatchewan, too

Beyond New Brunswick, provincial lotteries – throughout Canada – have seemingly been trying to work with First Nations more of late.

For instance, in early January, Saskatchewan’s online casino and sportsbook PlayNow revealed it reeled in $30.2 million in its opening two months. Saskatchewan Indian Gaming Authority operates PlayNow, so it is a significant milestone.

However, the partnership runs deeper. For instance, per the province’s Gaming Framework Agreement, First Nations are set to receive 50% of all PlayNow revenue moving forward.

According to the Federation of Sovereign Indigenous Nations, the deal is unprecedented. FSIN represents 74 First Nations in the province. Its chief Bobby Cameron said at the time:

“This historical partnership, is the first-of-its kind, with a First Nations operator for online gaming with revenue sharing between First Nations and the province.”

First Nations push to halt Ontario’s online gambling

Ontario hasn’t been quite as cordial. There, Canada’s most populated province finds itself in a legal dispute with First Nations surrounding its new online gambling regime.

According to legal documents, the Mohawk Council of Kahnawà:ke believes Ontario is violating the Federal Criminal Code.

Ratsenhaienhs (elected council chief) Mike Delisle Jr. previously commented on the matter to PlayCanada, saying :

“Firstly, we feel it is unlawful (meaning illegal) for Ontario to do what it’s doing.

“It’s actually the operators who are doing it [conducting and managing online gaming] …And secondly, it’s alienating [once again] Indigenous populations, not only Kahnawà:ke, in the province of Ontario [from] conducting online game.”

Delisle Jr. continued:

“To be shut out of Ontario – by far the largest province in Canada – will have devastating effects on a source of income that has supplemented programs and services in our community for the last two decades.”

Feds to give First Nations $2.8 billion in class action lawsuit

On a broader scale, First Nations – Canadian relations took a historic turn on Jan.21, 2023.

That was when officials announced the Canadian government would fork over $2.8 billion in a class action lawsuit to 325 First Nations.

The suit, filed in 2012, cited the loss of language and culture caused by the residential school system.

Granted,  a federal court must still approve the decision. But if approved, a new independent trust fund will operate for 20 years with the cash.

Of course, no amount of money will compensate for the collective harm Canada caused Indigenous people.

Regardless, it is encouraging to see governments start to move toward reconciliation.

Photo by Shutterstock
Jose Colorado Avatar
Written by
Jose Colorado

Jose Colorado is a British Columbia-based writer. He lives in Burnaby and loves sports, anime, writing, business and the occasional walk on the beach.

View all posts by Jose Colorado
Privacy Policy