by Jennifer Gaynor, Kate Lowenhar-Fisher, Greg Gemignani, and Jeff Silver
On March 5, 2018, Nevada’s Gaming Policy Committee convened briefly to pass a resolution that provides clarity for Nevada gaming licensees regarding the interactions they may and may not have with the state-legal marijuana industry.
This meeting followed from the discussion and testimony received at the last Gaming Policy Committee meeting in November 2017. As discussed in our article “Nevada’s Gaming Policy Committee Convenes to Discuss Marijuana and the Gaming Industry,” at that meeting it was made clear that gaming licensees have a sometimes-tricky line to walk in order to remain in strict compliance with state and federal law in a state where both medical and recreational marijuana are legal.
The three key issues discussed in the November meeting and dealt with in the Resolution include:
- The propriety of events on the premises of a licensed gaming establishment that cater to or promote the use, sale, and cultivation or distribution of marijuana;
- The propriety of a licensee contracting or maintaining a business relationship with an individual or entity engaged in the sale, cultivation, or distribution of marijuana; and
- The propriety of a licensee receiving financing from or providing financing to an individual, entity or establishment that sells, cultivates, or distributes marijuana.
The resolutions adopted on March 5 include that Nevada gaming licensees:
- shall not directly “participate in the marijuana industry”;
- shall not “contract with or maintain business relationships with or enter into landlord/tenant agreements with individuals or entities for the purpose of engaging in the sale, cultivation or distribution of marijuana”;
- shall not “receive financing from or provide financing to individuals, entities or establishments that sell, cultivate or distribute marijuana”;
- shall “continue to follow all federal direction regarding AML obligations and SAR reporting, in line with FINCEN guidance”;
- shall be allowed to “host conventions, trade shows, or similar conferences that may be related to marijuana but whose focus is primarily networking between participants . . . and other trade or educational activities that do not facilitate the actual possession or consumption of marijuana on a licensed property”;
- shall “take care to ensure that any events on the premises of a licensed gaming establishment do not promote illegal activities or foster incidents which might negatively impact the reputation of Nevada’s gaming industry”; and
- shall “conduct necessary due diligence and exercise discretion and sound judgment to prevent violations of Nevada or federal law in all business and financial activities.”
Although these resolutions are not legally binding, they do serve as policy recommendations for the Nevada Gaming Control Board and Gaming Commission and provide some additional clarity for gaming licensees.
Some of these recommendations are not news – it’s long been the policy of Nevada’s gaming regulators that licensees cannot directly participate in or have business relationships with the marijuana industry, including that any individuals who hold a gaming license shall not also be a landlord to a marijuana business. The guidance that licensees may host marijuana-industry trade shows and conferences, however, is sure to be welcome news in a town where conferences are big business.
About the Authors:
Jennifer Gaynor represents clients before the Nevada Legislature in Carson City, Nevada. She also practices before various professional and licensing boards and state and local tax authorities, and represents clients on matters involving First Amendment law, public records and open meeting law, gaming law and regulatory agency actions. In addition, Jennifer has been a guest lecturer on Gaming Law at the University of Nevada, Las Vegas, William S. Boyd School of Law. She is a frequent writer on gaming and regulatory matters. Jennifer may be contacted at 702-550-4462.
Kate Lowenhar-Fisher is a leading Nevada gaming attorney who counsels many of the world’s premier gaming companies on regulatory issues in connection with mergers and acquisitions, corporate restructuring, reorganizations and financings. She has extensive experience advising clients on issues related to Internet gaming, social gaming, fantasy sports, parimutuel products, liquor licensing, sweepstakes, contests, and promotions. She regularly represents individuals and businesses before regulatory agencies, including the Nevada State Gaming Control Board, the Nevada Gaming Commission, the Clark County Liquor and Gaming Licensing Board and the Las Vegas City Council. Kate may be contacted at 702-550-4459.
Greg Gemignani’s practice focuses primarily on intellectual property law, gaming law, technology law, internet law, online gaming law, and online promotions law. He has represented many clients ranging from the largest casino companies to start-up internet ventures. Greg is a member of the International Association of Gaming Advisors and the International Masters of Gaming Law. In addition, he is an Adjunct Professor at the University of Nevada, Las Vegas, William S. Boyd School of Law, teaching gaming law and gaming law policy courses. Greg may be contacted at 702-550-4468.
Jeff Silver’s practice focuses on every aspect of gaming, liquor licensing and regulatory law, as well as planning and zoning matters, contractor licensing and transportation law. He has testified before the Nevada Legislature and U. S. Congressional sub-committees on gaming law issues and has consulted on gaming regulatory matters in several jurisdictions. Jeff was the resident Las Vegas Member of the Nevada State Gaming Control Board during the state’s tumultuous period of developing regulatory oversight. He is a Member, Counsellor and former President of the International Association of Gaming Advisors. Jeff may be contacted at 702-550-4482.