I just finished Erle Stanley Gardner's Perry Mason book, The Case of the Dangerous Dowager. The Perry Mason books were written from the 1930s to the 1950s. I have also seen the boats in a Thin Man movie (the last and worst, Song of the Thin Man).
So I checked. Wikipedia has all the details (like everything), but there is also a great LA Times story of one of them.
What happened was that during prohibition and then the 1930s, gambling boats would anchor 3 miles offshore, just past the national limit (it has since been extended to 12 and 200 miles, depending on in regards to what it is in reference to). There gambling and booze were essential legal-ish.
The Rex
In movies and stories, they are depicted as luxurious haunts of the rich, famous, and big-time racketeers. The reality seemed something else indeed.
Wikipedia gives the best story of the demise:
Enforcement of the Law[edit]
There was once an incident off the shore of California by Santa Monica Bay. A man, Tony Cornero, owned a ship called "Rex." Cornero licensed his ship from the state of Nevada, where gambling was legal, and set anchor three miles out from the coast of California.[11] There were water taxis that would carry boat loads of people out to the "Rex" and they could gamble on the ship. A State Attorney General, Earl Warren, did not like having this ship off the coast of his state. Warren set out with the sheriff department and drove boats out to the "Rex" to shut it down.[11] Cornero would not give in for eight days. But when he did the dispute went to the courts. California’s supreme court decided that "three mile line" that marked international waters was not actually only three miles out from the nearest shore. The "Rex" was shut down permanently.[11]
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