The Cherokee Nation has filed a lawsuit that challenges the results of the Issue 2 referendum in Pope County that grants it a casino license. In the recently-held elections, voters voted for Issue 2, which means that the casino license that was previously granted to the Cherokee Nation was revoked, prohibiting it from building a casino in Pope County.

In a recent federal lawsuit, a subsidiary of the Cherokee Nation of Oklahoma claims that the constitutional rights of the Nation were disregarded by a statewide gaming referendum passed in Arkansas. The Cherokee Nation Entertainment, the tribe's commercial gaming and hospitality arm, is challenging the outcome of Issue 2, a ballot measure passed by Arkansas voters last week that repealed a previously awarded gaming license for a casino in Pope County's Russellville.

The Issue 2 referendum, approved by 56% of Arkansas voters, effectively repeals the commercial casino license allocated to the Cherokees in June by the Arkansas Racing Commission. CNE had planned to invest approximately $300 million in constructing the Legends Resort & Casino in Russellville, envisioning a high-end casino and entertainment facility. However, Issue 2 amends the Arkansas Constitution to prevent the issuance of casino licenses in counties that do not support such developments through a local referendum, a requirement that Pope County did not fulfill when casinos were initially legalized in 2018.

Ongoing legal disputes

While the three other authorized casinos in Crittenden, Jefferson, and Garland counties have since opened, the Pope County project has remained mired in legal battles for years. In 2018, Arkansas voters approved Amendment 100, legalizing commercial casinos in those four counties, but the specific allocation of a license for Pope County has faced significant pushback. Local opposition and court disputes delayed the establishment of a casino there, even after the ARC awarded the license to the Cherokees in June, deeming their bid the only qualifying submission.

Now, with Issue 2 repealing that license effective November 13, CNE has filed a lawsuit in the Eastern District of Arkansas, alleging that the referendum infringes on its constitutional rights. According to Bart Calhoun, an attorney for CNE, "Cherokee Nation Entertainment is firmly committed to protecting its constitutional rights, defending its lawfully issued casino license, and safeguarding the substantial investments it made in good faith based on the establishment of the Pope County casino license under Amendment 100 in 2018."

The tribe has reportedly incurred significant costs in its effort to open a commercial casino in Arkansas, including an estimated $12.5 million spent to contest Issue 2 in the lead-up to the vote. Additional legal expenses over the years have added millions more to the tab.

Seeking declaratory relief and injunction

In its legal filing, the Cherokee Nation is seeking declaratory relief from the court, aiming to have the amendment declared unconstitutional. It has also requested a preliminary injunction and temporary restraining order to prevent the amendment from going into effect this Wednesday, arguing that Issue 2 effectively nullifies the tribe's established rights under the state's original casino authorization.

The Cherokees maintain that the state's retroactive application of the referendum disregards both the tribe's legal status and the investments made toward developing the casino in Pope County, which they argue were undertaken with due diligence and in compliance with existing laws.

Response from state officials and opposition

Tim Griffin, the Arkansas Attorney General, responded to the Cherokee filing, labeling the allegations as 'baseless.' Griffin asserted that his office is prepared to defend the state's position, stating that the referendum reflected the will of Arkansas voters.

Similarly, Hans Stiritz, a representative for Local Voters in Charge - a campaign funded by the Choctaw Nation of Oklahoma to support Issue 2 - echoed Griffin's remarks. "This legal action to attempt to bypass the voice of Arkansas voters is not unexpected," Stiritz said. "But we are fully confident in the process that brought Issue 2 to the ballot. Arkansas voters have spoken clearly on Issue 2, and we expect it to stand."

Interestingly, while Pope County voters originally opposed casino development in 2018, the county recently voted against Issue 2, indicating a shift in local opinion in favor of the casino project. However, because the new amendment now mandates local approval prior to state licensing, the Cherokees' license remains in jeopardy despite this recent shift.