The Santa Monica Bay Battle Over Gambling Ships And Border Lines

By Nolan Moore on Friday, August 14, 2015
Woman throwing dice on gaming table, smiling, portrait
“That the chance of gain is naturally over-valued, we may learn from the universal success of lotteries.” —Adam Smith, “The Wealth of Nations”

In A Nutshell

In 1938, an enterprising businessman named Tony Cornero opened a floating casino off the coast of California. Known as the Rex, his ship attracted thousands of gamblers every night . . . and that didn’t sit well with California Attorney General Earl Warren. Eventually, Warren sent 250 lawmen to shut the ship down, and that’s when Tony decided to fight back.

The Whole Bushel

His name was Antonio Cornero Stralla, but he called himself Tony Cornero. Born in Piedmont, this Italian became a major player in the high-risk world of American rum-running, smuggling Scotch from Mexico and Canada via the Pacific. Hey, somebody had to “keep 120 million Americans from poisoning themselves” with that nasty homebrewed garbage.

Unfortunately for Tony, he was busted and spent some time behind bars. When he was released, Congress had screwed up his business by legalizing liquor. Needing another line of work, Cornero decided to return to the sea . . . and open up a floating casino.

In May 1938, Tony opened the Rex, a ship full of roulette wheels, blackjack tables, poker players, and dice aplenty. Floating in Santa Monica Bay, the Rex held up to 3,000 customers and a staff of over 300 people. Tony advertised the Rex in newspapers, claiming his casino put Monte Carlo to shame, and hired pilots to spell out the name of his ship in the sky.

Of course, it wasn’t all fun and games. Cornero had security guards on board who carried automatic weapons in case pirates decided to try their luck at the craps table. However, legitimate gamblers didn’t have anything to worry about. Shockingly, Tony wasn’t involved with any Mafia families, and he claimed his games were completely honest.

If customers (or “squirrels” as Tony called them) wanted to try one of his 150 slot machines or lounge in the horse parlor, they needed to sail 4.99 kilometers (3.1 mi) off from shore in a water taxi. Why such a specific number? Well, California frowned on casinos, and Tony knew international waters started 4.83 kilometers (3 mi) off the coastline. By setting up shop away from shore, he was free to do as he pleased.

Or so he thought.

Unfortunately, Tony ticked off some powerful people including California Attorney General Earl Warren. Yes, that Earl Warren, the guy who’d later become Chief Justice of the Supreme Court. According to Earl, that three-mile marker Tony was talking about didn’t even start until you got further out in the water, far past the Rex. If Warren was right, that meant Tony was operating inside California territory, and that meant Tony was going down.

Over the next few months, the government forced Tony’s water taxi service to stop ferrying customers to the Rex. Warren had Cornero’s phones tapped, and the casino owner was arrested multiple times. Whenever he showed up in court, the lawyers would argue about that pesky mile marker. Where did it start? Was Tony inside or outside the state’s jurisdiction?

After all, this was a big deal. If Tony was forced to anchor the Rex further out, it would take too long for gamblers to reach the boat, and all those powerful Pacific swells would make everyone seasick. In other words, it’d be really bad for business. But finally in the summer of ’38, Tony won an appeal and was allowed to stay put, 4.99 kilometers (3.1 mi) off the mainland.

And that’s when the Battle of Santa Monica Bay began.

Since Tony was operating legally, Warren had to come up with something else to charge him with, like contributing to “the delinquency of minors by openly glorifying . . . gambling and the evasion of the laws of the state.” Hey, whatever works.

On August 1, 1939, Warren sent 250 lawmen to put a stop to Cornero once and for all. Along the way, they raided several other ships, all of which surrendered without a struggle. The cops tossed the slot machines into the ocean and chopped up their blackjack tables. But when Tony saw the armada heading his way, he decided it was time to fight.

When the authorities pulled up alongside the ship, Tony attacked. His men blasted the enemy boats with water hoses, forcing the lawmen to retreat. Just to make sure they couldn’t do any damage if they got on board, Tony barricaded the casino with a thick steel door. And after helping his 600 customers get safely off the ship, Cornero and company hunkered down for the siege.

Over the next nine days, Tony and the authorities engaged in a war of words. Armed with bullhorns, the two groups shouted back and forth, with Cornero delivering lines like, “I won’t give up that ship!” and “We’ve got plenty of provisions, and we’re having a good time.” But eventually, the good times started wearing Tony down, and the outlaw surrendered on the ninth day. As the cops destroyed his machines, Tony explained to the newspapers that he’d surrendered because he needed a haircut.

Of course, the fight wasn’t over yet. Once again, Tony went to court, only this time, his case ended up in front of the state supreme court. But after poring over documents dating back to the 1500s, the justices ruled Tony was operating in California waters and ordered him to fork over quite a bit of cash for fines and unpaid taxes. Tony had lost for good. The Rex was turned into a World War II cargo ship, and Tony moved to Las Vegas. But he wasn’t beaten quite yet.

In 1946, Tony returned to California and opened another casino ship called the Lux, complete with a dance floor and 30-meter (100 ft) bar. He parked the Lux 9.7 kilometers (6 mi) off the coast of Long Beach, but it didn’t matter. Earl Warren was now California governor, and he wasn’t about to let Tony get away with the same stunt. The government seized the ship, and Tony was forced to retreat to Vegas.

Things finally came to an end in 1955. Tony was getting ready to open the Stardust hotel, but one night in July, he was having a particularly bad run of luck. He was $100,000 behind in a pretty intense dice game when Tony’s ticker decided it was time to retire. That’s when Tony Cornero floated off to that great big casino ship in the sky, just weeks before his hotel was planned to open.

Show Me The Proof

LA Mag: Tony Cornero And The S.S. Rex
LAistory: The Battle of Santa Monica Bay