Chicken Ranch Rancheria v. State of California

FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

CHICKEN RANCH RANCHERIA OF ME- No. 21-15751

WUK INDIANS; CHEMEHUEVI INDIAN

TRIBE; BLUE LAKE RANCHERIA; D.C. No.

HOPLAND BAND OF POMO INDIANS; 1:19-cv-00024-

ROBINSON RANCHERIA, AWI-SKO

Plaintiffs-Appellees,

v. OPINION

STATE OF CALIFORNIA; GAVIN

NEWSOM, Governor of California,

Defendants-Appellants.

Appeal from the United States District Court

for the Eastern District of California

Anthony W. Ishii, District Judge, Presiding

Argued and Submitted December 9, 2021

San Francisco, California

Filed July 28, 2022

Before: Kim McLane Wardlaw, Daniel A. Bress, and

Patrick J. Bumatay, Circuit Judges.

Opinion by Judge Bress;

Concurrence by Judge Wardlaw;

Dissent by Judge Bumatay

2 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

SUMMARY *

Indian Gaming Regulatory Act

The panel affirmed, on different grounds, the district

court’s summary judgment in favor of Chicken Ranch

Rancheria of Mewuk Indians and other tribes in their action

under the Indian Gaming Regulatory Act against the State of

California and Governor Gavin Newsom.

The tribes alleged that California violated IGRA by

failing to act in good faith in the parties’ negotiations for

compacts for the tribes to conduct high-stakes Las Vegas-

style casino gambling, known as Class III gaming. The

district court concluded that California’s demand for tribal

enforcement of state domestic support orders “pulled

negotiations into a field wholly collateral to the operation of

gaming facilities” and thus constituted “per se evidence of

bad faith.” The district court concluded that other disputed

provisions were “somewhat connected” to gaming and thus

not a per se violation of the State’s good-faith duty, but

California nevertheless was required to provide “meaningful

concessions” in exchange for demanding these provisions,

and the State’s failure to do so was a failure to negotiate in

good faith, triggering IGRA’s remedial provisions.

The panel held that through its insistence on family law,

environmental law, and tort provisions, California

substantially exceeded IGRA’s limitation that any Class III

compact provision be directly related to the operation of

gaming activities. The panel further held that when, as here,

*

This summary constitutes no part of the opinion of the court. It

has been prepared by court staff for the convenience of the reader.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 3

a State seeks to negotiate for compact provisions that fall

well outside IGRA's seven permissible topics of negotiation,

as set forth in an exhaustive list in 25 U.S.C.

§ 2710(d)(3)(C), the State has not acted in good faith.

Agreeing with the Department of the Interior, the panel held

that the final item in the list, a residual provision for “any

other subjects that are directly related to the operation of

gaming activities,” requires a “direct connection” to the

operation of gaming activities. The panel therefore directed

the parties to proceed to IGRA’s remedial framework under

the district court’s continued supervision.

The panel disagreed with the dissent’s conclusion that,

despite negotiating for off-list topics, California still could

show it was negotiating in good faith.

The panel explained that, although the district court

agreed that California had not negotiated in good faith and

that IGRA’s remedial provisions were triggered, it erred in

relying on the “meaningful concessions” framework because

this framework does not apply to requested topics of

negotiation that are well outside the permitted topics in

§ 2710(c)(3)(C), and applies only to demands for taxes, fees,

or other revenue-sharing provisions.

Concurring, Judge Wardlaw wrote that IGRA is

ambiguous on the question whether a State conducts tribal-

state compact negotiations in bad faith when it insists on

negotiating topics beyond the exclusive topics beyond the

exclusive topics set forth in IGRA § 2710(d)(3)(C). She

wrote that Congress did not clearly explain how the

exhaustive list of negotiating topics interacts with the good

faith burden-shifting provisions that apply once a tribe files

an enforcement action; nor did it define “good faith” to

include or exclude the State’s introduction of unauthorized

4 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

topics. Judge Wardlaw agreed with the majority opinion’s

analysis of the text and structure of IGRA, further supported

by IGRA’s stated purpose and its legislative history and the

principal that statutes are to be construed liberally in favor

of Indians, with ambiguous provisions interpreted to their

benefit.

Dissenting, Judge Bumatay agreed that IGRA’s seven

topics of permissible negotiation are exhaustive and that

California exceeded those topics through its family,

environmental, and tort law proposals, but he would hold

that, under the burden-shifting framework of the statutory

text, the State could still show that it was negotiating in good

faith. Judge Bumatay wrote that he would vacate the district

court’s judgment and remand for a proper analysis of

whether California satisfied its good-faith duty.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 5

COUNSEL

Timothy M. Muscat (argued), Deputy Attorney General;

William P. Torngren, Supervising Deputy Attorney General;

Sara J. Drake, Senior Assistant Attorney General; Rob

Bonta, Attorney General; Office of the Attorney General,

Sacramento, California; for Defendants-Appellants.

Lester J. Marston (argued), Rapport and Marston, Ukiah,

California; David B. Dehnert, Dehnert Law PC, Marina Del

Rey, California; for Plaintiffs-Appellees.

George Forman, Jay B. Shapiro, and Margaret C. Rosenfeld,

Forman & Associates, San Rafael, California, for Amici

Curiae Bear River Band of Rohnerville Rancheria, Cahuilla

Band of Indians, Cachil Dehe Band of Wintun Indians of the

Colusa Indian Community, and Soboba Band of Luiseño

Indians.

Kristin L. Martin, McCracken Stemerman & Holsberry LLP,

San Francisco, California, for Amicus Curiae Unite Here

International Union.

Laura E. Hirahara, Associate Counsel, California State

Association of Counties, Sacramento, California, for

Amicus Curiae California State Association of Counties.

6 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

OPINION

BRESS, Circuit Judge:

Under the Indian Gaming Regulatory Act (IGRA),

25 U.S.C. § 2701 et seq., Indian tribes must enter a compact

with the state in order to conduct high-stakes Las Vegas-

style casino gambling, known as Class III gaming. But to

prevent states from using their compact approval authority

to force regulations on tribes that the states would otherwise

be powerless to enact, Congress in IGRA imposed important

safeguards on compact negotiations. IGRA strictly limits

the topics that states may include in tribal-state Class III

compacts to those directly related to the operation of gaming

activities. 25 U.S.C. § 2710(d)(3)(C). States are also

required to negotiate compact agreements in good faith. Id.

§ 2710(d)(3)(A). If a state does not negotiate in good faith,

the tribe may sue in federal court and obtain remedies

designed to force the state to the bargaining table and get the

deal done. Id. § 2710(d)(7)(B).

We hold in this case that California failed to act in good

faith in its compact negotiations with the plaintiff Tribes.

The central problem with California’s approach was this: it

for years demanded that the Tribes agree to compact

provisions relating to family law, environmental regulation,

and tort law that were unrelated to the operation of gaming

activities and far outside the bounds of permissible

negotiation under IGRA. Through its negotiating demands,

California effectively sought to use the Class III contracting

process as leverage to impose its general policy objectives

on the Tribes, which a state may not do. California thereby

failed to act in good faith, triggering IGRA’s remedial

provisions.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 7

We affirm the judgment of the court below, although,

importantly, on grounds different than the district court

articulated.

I

The plaintiffs are the Chicken Ranch Rancheria of Me-

Wuk Indians, Blue Lake Rancheria, Chemehuevi Indian

Tribe, Hopland Band of Pomo Indians, and Robinson

Rancheria. The history of the Tribes’ Class III negotiations

with the State of California is extensive, and we recite only

those events pertinent to this appeal. Some of this history is

wrapped up in the history of IGRA itself, but we will limit

ourselves here to the facts giving rise to this case and turn to

IGRA next.

After Congress passed IGRA in 1988, California and

approximately 60 tribes, including the plaintiff Tribes,

entered a 1999 compact that gave Indian tribes in California

the exclusive right to host Class III gaming. See In re Indian

Gaming Related Cases (Coyote Valley II), 331 F.3d 1094,

1104 (9th Cir. 2003). In return, the tribes agreed to accept

various regulations and duties relating to their gaming

activities. Id. at 1104–05. The 1999 compacts were set to

expire on December 31, 2020, but provided for an automatic

extension through June 30, 2022 for those tribes that were in

negotiations to extend or replace their existing compacts,

which includes the plaintiff Tribes. Very recently,

California and the plaintiff Tribes agreed to extend the 1999

compacts until December 31, 2023.

Negotiations over successor compacts to the 1999

compacts have been ongoing for years. In 2014, the plaintiff

Tribes joined various other Indian tribes with existing 1999

compacts to form the Compact Tribes Steering Committee

(CTSC). The first formal negotiation session was held in

8 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

January 2015. Between 2015 and 2019, California and the

CTSC held 39 days of in-person negotiation sessions, in

addition to numerous smaller sessions focused on discrete

issues. Over that time, the State provided at least twelve full

draft compacts to the CTSC, and the CTSC offered

approximately fourteen drafts of its own.

Although the parties reached consensus on some issues,

other aspects of the negotiations were fraught. For example,

California sought a provision that would require the Tribes

to recognize and enforce state spousal and child support

judgments against tribal gaming facility employees.

California also requested that the Tribes agree to extensive

environmental regulations—devoting nearly 30 pages of

detailed draft compact provisions to this topic alone.

California also wanted the Tribes to adopt California tort law

as tribal law that would apply in various situations

disconnected from gaming activities, while insisting the

Tribes waive sovereign immunity for tort claims and

establish tort claims commissions. The Tribes maintained

that these requests were insufficiently related to gaming, and

that the State therefore could not negotiate for them under

IGRA.

Despite these objections, the CTSC operated on a

parallel path and endeavored to negotiate the disputed topics

“in anticipation of the State offering meaningful

concessions” of significant value. But the Tribes came to

believe that California was not offering sufficient additional

consideration. And California refused to accept any

compact that did not include the challenged topics of

negotiation. By the end of 2019, and after nearly five years

of formal negotiations with the State, the plaintiff Tribes had

seen enough. They withdrew from the CTSC and turned

down California’s existing offers. The tribes also tried one

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 9

last time, proposing a “best and final offer.” But California

did not accept it.

In January 2019, the Tribes sued the State, alleging that

California violated IGRA’s duty to negotiate in good faith.

On cross-motions for summary judgment, the district court

agreed with the Tribes. The court concluded that

California’s demand for tribal enforcement of state domestic

support orders “pulled negotiations into a field wholly

collateral to the operation of gaming facilities,” and thus

constituted “per se evidence of bad faith.” The court went

on to explain that many of the other disputed provisions were

“not at the heart of,” or only “at the very edge of relevance”

to, gaming activities. But the district court believed these

other provisions were still “somewhat connected” to gaming

and thus not a per se violation of the State’s good-faith duty.

Nevertheless, because many of the disputed topics still

had tenuous connections to gaming, the district court

interpreted our precedents to require that the State provide

“meaningful concessions” in exchange for demanding these

provisions. It then found that California had failed to offer

such concessions, and that California had thus not negotiated

with the Tribes in good faith. The district court granted

summary judgment for the Tribes and ordered that IGRA’s

remedial process take hold. See 25 U.S.C.

§ 2710(d)(7)(B)(iii)–(vii).

California now appeals the district court’s decision,

which we review de novo. Avery v. First Resolution Mgmt.

Corp., 568 F.3d 1018, 1021 (9th Cir. 2009). We may affirm

on any ground supported by the record. Miranda v. City of

Casa Grande, 15 F.4th 1219, 1224 (9th Cir. 2021).

10 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

II

To understand where California went astray in the

compact negotiations, we begin by recognizing the unique

and limited powers that IGRA gives states over Indian tribes.

“[T]he Constitution grants Congress broad general powers

to legislate in respect to Indian tribes, power that [the

Supreme Court] ha[s] consistently described as ‘plenary and

exclusive.’” United States v. Lara, 541 U.S. 193, 200

(2004). The corollary to this is that states generally lack the

power to regulate tribes: “tribal sovereignty is dependent on,

and subordinate to, only the Federal Government, not the

States.” Washington v. Confederated Tribes of Colville

Indian Rsrv., 447 U.S. 134, 154 (1980). Thus, “State laws

generally are not applicable to tribal Indians on an Indian

reservation except where Congress has expressly provided

that State laws shall apply.” McClanahan v. State Tax

Comm’n of Ariz., 411 U.S. 164, 170–71 (1973) (quotations

omitted); see Ysleta Del Sur Pueblo v. Texas, No. 20-493, —

S. Ct. —, 2022 WL 2135494, at *3 (U.S. June 15, 2022)

(“From time to time, Congress has exercised its authority to

allow state law to apply on tribal lands where it otherwise

would not.”).

In California v. Cabazon Band of Mission Indians, 480

U.S. 202 (1987), the Supreme Court held that California

lacked the federal statutory authority required to regulate

bingo halls on tribal lands. The Court started from the well-

accepted proposition that “state laws may be applied to tribal

Indians on their reservations if Congress has expressly so

provided.” Id. at 207. But it found no federal statutory

authority for California’s attempt to regulate tribal bingo

enterprises. Id. at 212–14.

Congress passed IGRA in response to Cabazon. See

Ysleta Del Sur Pueblo, — S. Ct. —, 2022 WL 2135494,

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 11

at *5; Coyote Valley II, 331 F.3d at 1095–97. In IGRA,

“Congress attempted to strike a delicate balance between the

sovereignty of states and federally recognized Native

American tribes.” Pauma Band of Luiseno Mission Indians

v. California (Pauma I), 813 F.3d 1155, 1160 (9th Cir.

2015). IGRA gave Indian tribes “the exclusive right to

regulate gaming activity on Indian lands if the gaming

activity is not specifically prohibited by Federal law and is

conducted within a State which does not, as a matter of

criminal law and public policy, prohibit such gaming.”

25 U.S.C. § 2701(5). IGRA thus created “a statutory basis

for the operation of gaming by Indian tribes as a means of

promoting tribal economic development, self-sufficiency,

and strong tribal governments.” Id. § 2702(1). IGRA also

created a statutory basis for regulating these gaming

activities. Id. § 2702(2). The stated objectives of this

regulation, however, were generally focused on the integrity

of the gaming enterprise itself: “to shield it from organized

crime and other corrupting influences, to ensure that the

Indian tribe is the primary beneficiary of the gaming

operation, and to assure that gaming is conducted fairly and

honestly by both the operator and players.” Id.

IGRA divides gaming activity into three classes, with

each class subject to different degrees of federal and state

regulation. See 25 U.S.C. § 2710(d)(1)(C). The most

significant aspect of IGRA concerns Class III gaming, “the

types of high-stakes games usually associated with Nevada-

style gambling.” Coyote Valley II, 331 F.3d at 1097.

Examples of Class III gaming include blackjack, baccarat,

slot machines, and parimutuel horse-wagering. Artichoke

Joe’s Cal. Grand Casino v. Norton, 353 F.3d 712, 715 (9th

Cir. 2003); see 25 U.S.C. § 2703(7)–(8).

12 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

We have described IGRA as “an example of cooperative

federalism in that it seeks to balance the competing

sovereign interests of the federal government, state

governments, and Indian tribes, by giving each a role in the

regulatory scheme.” Pauma I, 813 F.3d at 1160 (quotations

omitted). That is principally because Class III gaming is

permitted on Indian lands only if, inter alia, a tribe and the

state enter a tribal-state compact that the Secretary of the

Interior then approves. Coyote Valley II, 331 F.3d at 1097;

see also 25 U.S.C. § 2710(d)(1), (3)(B). A tribal-state

compact “prescribes rules for operating gaming, allocates

law enforcement authority between the tribe and State, and

provides remedies for breach of the agreement’s terms.”

Michigan v. Bay Mills Indian Cmty., 572 U.S. 782, 785

(2014).

Although IGRA is an example of cooperative federalism,

Congress was clear-eyed that state involvement could turn

decidedly uncooperative. Class III gaming is not only “a

source of substantial revenue” for tribes, but the lifeblood on

“which many tribes ha[ve] come to rely.” Coyote Valley II,

331 F.3d at 1097, 1099–1100. The risks inherent in the state

compact approval requirement are therefore obvious: Indian

tribes, who rely on gaming for economic revenue, are at the

potential mercy of the states, which could withhold approval

of Class III gaming rights or insist upon onerous compact

conditions that would give states greater power to regulate

tribes.

Congress was well aware of the danger that states could

use their compacting approval powers to encroach on tribal

sovereignty. Thus, “Congress enacted IGRA to provide a

legal framework within which tribes could engage in

gaming—an enterprise that holds out the hope of providing

tribes with the economic prosperity that has so long eluded

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 13

their grasp—while setting boundaries to restrain aggression

by powerful states.” Rincon Band of Luiseno Mission

Indians v. Schwarzenegger, 602 F.3d 1019, 1027 (9th Cir.

2010).

IGRA imposes those boundaries in two critical ways.

First, “[b]ecause the compact requirement skews the balance

of power over gaming rights in favor of states by making

tribes dependent on state cooperation,” id., states have an

obligation to engage in compact negotiations in good faith.

25 U.S.C. § 2710(d)(3)(A). That obligation has teeth

because a tribe may sue in federal court for a state’s violation

of its good-faith duty. Id. § 2710(d)(7)(A)(i). 1

In such an action, the plaintiff tribe must first, “upon the

introduction of evidence,” demonstrate that the state has not

negotiated in good faith. Id. § 2710(d)(7)(B)(ii). Following

that initial showing, “the burden of proof shall be upon the

State to prove that the State has negotiated with the Indian

tribe in good faith.” Id.; see also Pauma Band of Luiseno

Mission Indians v. California (Pauma II), 973 F.3d 953, 958

(9th Cir. 2020) (describing the burden-shifting framework).

If a court finds that a state has failed to act in good faith,

this triggers IGRA’s remedial provisions. In that event, the

district court “shall order the State and Indian Tribe to

conclude such a compact within a 60-day period.” 25 U.S.C.

§ 2710(d)(7)(B)(iii). If that process fails to yield an

agreement, the court is required to appoint a mediator to

1

In Seminole Tribe v. Florida, 517 U.S. 44, 54–55 (1996), the

Supreme Court held that the Eleventh Amendment prohibited tribes from

suing states under IGRA absent a state consenting to suit. California has

expressly consented to federal suits brought by California tribes under

IGRA. See Cal. Gov. Code § 98005; see also Coyote Valley II, 331 F.3d

at 1101 & n.9.

14 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

select a proposed compact that “best comports” with IGRA.

Id. § 2710(d)(7)(B)(iv). The state then has 60 days to accept

the mediator’s proposal. See id. § 2710(d)(7)(B)(vi). If the

state still refuses, the Secretary of the Interior shall

promulgate procedures under which the tribe may conduct

Class III gaming, consistent with the mediator’s proposed

compact and IGRA’s terms. See id. § 2710(d)(7)(B)(vii).

Second, IGRA polices state overreach by circumscribing

the permissible topics of negotiation, setting forth seven

allowed areas in which tribes and states may reach

agreement. Specifically, IGRA provides that a tribal-state

compact “may include provisions relating to—”:

(i) the application of the criminal and civil

laws and regulations of the Indian tribe or the

State that are directly related to, and

necessary for, the licensing and regulation of

such activity;

(ii) the allocation of criminal and civil

jurisdiction between the State and the Indian

tribe necessary for the enforcement of such

laws and regulations;

(iii) the assessment by the State of such

activities in such amounts as are necessary to

defray the costs of regulating such activity;

(iv) taxation by the Indian tribe of such

activity in amounts comparable to amounts

assessed by the State for comparable

activities;

(v) remedies for breach of contract;

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 15

(vi) standards for the operation of such

activity and maintenance of the gaming

facility, including licensing; and

(vii) any other subjects that are directly

related to the operation of gaming activities.

25 U.S.C. § 2710(d)(3)(C).

In addition, another provision of IGRA emphasizes that

states generally lack the authority to tax Indian tribes.

Specifically, except for any agreed-upon assessments under

§ 2710(d)(3)(C)(iii), “nothing in this section shall be

interpreted as conferring upon a State or any of its political

subdivisions authority to impose any tax, fee, charge, or

other assessment upon an Indian tribe or upon any other

person or entity authorized by an Indian tribe to engage in a

class III activity.” Id. § 2710(d)(4).

If a tribe files suit alleging that a state has failed to

negotiate in good faith, IGRA provides that the court “may

take into account the public interest, public safety,

criminality, financial integrity, and adverse economic

impacts on existing gaming activities.” Id.

§ 2710(d)(7)(B)(iii)(I). But it “shall consider any demand

by the State for direct taxation of the Indian tribe or of any

Indian lands as evidence that the State has not negotiated in

good faith.” Id. § 2710(d)(7)(B)(iii)(II).

III

This statutory background sets the stage for the principal

questions in this case, which are (1) did California exceed

the permissible topics of negotiation under IGRA, and (2) if

so, what is the consequence of this? We hold that through

its insistence on family law, environmental law, and tort law

16 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

provisions, California substantially exceeded IGRA’s

limitation that any Class III compact provision be directly

related to the operation of gaming activities. We further hold

that when, as here, a state seeks to negotiate for compact

provisions that fall well outside IGRA’s permissible topics

of negotiation, the state has not acted in good faith.

A

California crossed the line in negotiating far outside

IGRA’s permitted list of compact negotiation topics. We

can begin to see why by examining the statute’s list of

allowed topics, which, as we will explain, sets forth the only

permitted topics of negotiation.

We quoted the list of IGRA’s seven permitted topics in

full above, but as a reminder, it may be found at 25 U.S.C.

§ 2710(d)(3)(C). That provision states that a Class III

gaming compact “may include provisions relating to” the

seven identified topics, which culminate in the catch-all

topic of “any other subjects that are directly related to the

operation of gaming activities.” Id. § 2710(d)(3)(C)(vii).

This list, we hold, is exhaustive. In fact, we have

effectively already so held. In Rincon Band, we said that

“[t]he language and structure of § 2710(d)(3)(C) suggests it

is exhaustive,” and then squarely held that “IGRA limits

permissible subjects of negotiation in order to ensure that

tribal-state compacts cover only those topics that are related

to gaming and are consistent with IGRA’s stated purposes.”

602 F.3d at 1028–29 & n.9 (emphasis added). IGRA, we

made clear, “does not permit the State and the tribe to

negotiate over any subjects they desire; rather, IGRA

anticipates a very specific exchange of rights and

obligations.” Id. at 1039; see also Seminole Tribe, 517 U.S.

at 49 (citing § 2710(d)(3)(C) as setting “the permissible

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 17

scope of a Tribal-State compact”); Navajo Nation v. Dalley,

896 F.3d 1196, 1205 n.4 (10th Cir. 2018) (explaining that

“the negotiated terms of the Compact cannot exceed what is

authorized by IGRA” (quotations omitted)).

Although our past precedents did not engage in detail

with IGRA’s text, the plain language of § 2710(d)(3)(C)

confirms that its list of seven topics is exhaustive. That

section sets out a list of six permitted specific topics and ends

with the catch-all “any other subjects that are directly related

to the operation of gaming activities.” We could no doubt

bring many Latin canons to bear on § 2710(d)(3)(C), but we

think it easy enough to say the obvious: that the natural

inference from this enumerated list is that it is exclusive.

Why else devote such attention to drafting a careful itemized

list only to have it impose no limits? Indeed, if the list were

not exhaustive there would be little point in including the

catch-all provision.

It is true, of course, that § 2710(d)(3)(C) prefaces its list

by stating that a tribal-state compact “may include provisions

relating to” the seven identified topics. But the word “may”

is not necessarily a fully permissive term—it does not

always mean one “may” do anything, or that everything

following the “may” is merely by way of suggestion.

Depending on the context, “may” can be limiting, meaning

“may only.” See, e.g., Cooper Indus., Inc. v. Aviall Servs.,

Inc., 543 U.S. 157, 166 (2004) (explaining that “the natural

meaning of ‘may’ in the context of [an] enabling clause is

that it authorizes certain . . . actions—ones that satisfy the

subsequent specified condition—and no others”); Cortez

Byrd Chips, Inc. v. Bill Harbert Constr. Co., 529 U.S. 193,

198 (2000) (explaining that “the mere use of ‘may’ is not

necessarily conclusive of congressional intent to provide for

a permissive or discretionary authority”); Citizens & S. Nat’l

18 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

Bank v. Bougas, 434 U.S. 35, 38 (1977) (noting it was

“settled” that the word “may” in a venue provision meant

“may . . . only”); Marathon Oil Co. v. United States,

374 F.3d 1123, 1138 (Fed. Cir. 2004) (“[T]he word ‘may’ in

some contexts is not permissive but indeed is interpreted as

restrictive in nature.”).

In the context of § 2710(d)(3)(C)’s list of six specific

topics followed by a catch-all seventh, it is more natural to

read “may” in its restrictive sense, as “may only.” As we

explained in Rincon Band, “[a]lthough ‘may’ indicates

permissiveness . . . , to grant permission is not necessarily

to grant carte blanche. What is ‘permitted’ is limited.”

602 F.3d at 1028 n.9. Thus, a tribal-state compact may

include provisions relating to the seven identified topics

(though it is not necessarily required to), but it may not

include provisions that do not relate to the topics listed.

That interpretation makes a great deal of sense when one

steps back and appreciates the critical role of

§ 2710(d)(3)(C) in IGRA’s overall structure and design.

Congress “limit[ed] the proper topics for compact

negotiations to those that bear a direct relationship to the

operation of gaming activities.” Coyote Valley II, 331 F.3d

at 1111. The reason this was so essential, we have explained,

is because “Congress intended to prevent compacts from

being used as subterfuge for imposing State jurisdiction on

tribes concerning issues unrelated to gaming.” Id.; see also

Rincon Band, 602 F.3d at 1028 n.9. If the list of seven topics

in § 2710(d)(3)(C) were not exhaustive, states could try to

impose on the tribes a potentially infinite range of provisions

reflecting general state policy objectives, even ones that

strike deep at the heart of tribal sovereignty. That would be

directly contrary to the background principle that—for the

operation of gaming activities only—IGRA creates a limited

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 19

exception to states’ general lack of power to regulate Indian

tribes on Indian lands. See Confederated Tribes of Colville,

447 U.S. at 154; McClanahan, 411 U.S. at 170–71; Coyote

Valley II, 331 F.3d at 1095–96.

B

With the exhaustive nature of § 2710(d)(3)(C)

established, we can begin to focus more intently on the three

most heavily disputed parts of the parties’ compact

negotiations: those relating to family, environmental, and

tort law. These items do not fit with any of the first six listed

topics in § 2710(d)(3)(C), and California does not attempt to

argue otherwise. So if these topics are permissible subjects

of compact negotiation, they must fit within the residual

provision of “any other subjects that are directly related to

the operation of gaming activities.” 25 U.S.C.

§ 2710(d)(3)(C)(vii). Some parsing of this phrase is

therefore required.

Contrary to California’s apparent suggestion, the phrase

“directly related to the operation of gaming activities”

imposes meaningful limits on compact negotiations. The

word “directly” is significant. “Directly” connotes a more

linear connection between the subject that is to be negotiated

and the “operation of gaming activities.” “Directly” means

“[i]n a straightforward manner” or “[i]n a straight line or

course.” Black’s Law Dictionary (11th ed. 2019). In some

sense, everything is “related” to everything else; the word

“directly” ensures that we cannot give § 2710(d)(3)(C)’s

catch-all that sort of expansive interpretation. Thus, topics

of negotiation that have attenuated relationships to the

operation of gaming activities, or merely tangential,

incidental, or collateral relationships, are not permitted.

Chemehuevi Indian Tribe v. Newsom, 919 F.3d 1148, 1153

(9th Cir. 2019) (“[T]he proper inquiry is whether a

20 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

compact’s [topic] is so attenuated from gameplay that it falls

outside of paragraph 3(C)(vii).”).

The broader structure of § 2710(d)(3)(C) confirms the

focused nature of the phrase “directly related to” in

§ 2710(d)(3)(C)(vii). As a residual clause,

§ 2710(d)(3)(C)(vii) takes its meaning from, and is limited

by, the rest of § 2710(d)(3)(C). See, e.g., Yates v. United

States, 574 U.S. 528, 545 (2015); Washington State Dept. of

Soc. and Health Servs. v. Guardianship Estate of Keffeler,

537 U.S. 371, 384 (2003). It is of course true that as a

residual clause, § 2710(d)(3)(C)(vii) is inevitably “broader

than the more specific topics enumerated in [the]

paragraphs” that precede it. Chemehuevi Indian Tribe,

919 F.3d at 1152. But its scope can only be understood in

the context of § 2710(d)(3)(C) as a whole.

The residual clause allows states and tribes to agree on

any “other subjects that are directly related to the operation

of gaming activities,” confirming that the preceding six

topics are themselves “directly related to the operation of

gaming activities.” And indeed they are: they pertain to the

licensing and regulation of gaming activities and the

enforcement of the same, id. § 2710(d)(3)(C)(i)–(ii); state

assessment and tribe taxation of gaming activities, id.

§ 2710(d)(3)(C)(iii)–(iv); remedies for breach of contract,

id. § 2710(d)(3)(C)(v); and standards for the operation of

gaming activities and facilities, id. § 2710(d)(3)(C)(vi).

Section 2710(d)(3)’s overall focus on the actual “operation

of gaming activities” is apparent. In interpreting the residual

clause, we must thus take heed of the provisions that precede

it, which contribute to its substantive content.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 21

We therefore agree with the Department of Interior that:

In the context of applying the “catch-all”

category, we do not simply ask “but for the

existence of the Tribe’s class III gaming

operation, would the particular subject

regulated under a compact provision exist?”

If this question were used to provide the

standard for determining whether a particular

object of regulation was “directly related to

the operation of gaming activities,” it would

permit states to use tribal-state compacts as a

means to regulate tribal activities far beyond

that which Congress intended when it

originally enacted IGRA.

We do not have occasion to decide whether this agency

interpretation requires any deference; we simply find it

persuasive in its alignment with our own independent

conclusion. What is required, as the Department of Interior

has correctly recognized, is a “direct connection” to the

operation of gaming activities.

That is consistent with our analysis in Rincon Band

concerning a proposed general revenue sharing provision.

There, we rejected as “circular” California’s argument that

general revenue sharing was “directly related to the

operation of gaming activities” simply because “the money

[wa]s paid out of income from gaming activities.” 602 F.3d

at 1032. As we explained, “[w]hether revenue sharing is an

authorized negotiation topic under § 2710(d)(3)(C)(vii) . . .

depends on the use to which the revenue will be put, not on

the mere fact that the revenue derives from gaming

22 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

activities.” Id. at 1033. That was, in essence, a rejection of

a pure “but for” test. 2

The phrase “directly related” is also not the only limiting

feature of § 2710(d)(3)(C)(vii). The referent phrase—“the

operation of gaming activities”—is further limiting. It

cannot mean “anything that takes place on tribal lands.” Nor

can it mean “anything relating to a casino property.” The

phrase “‘[d]irectly related to the operation of gaming

activity’ is narrower than ‘directly related to the operation of

the Casino.’” Flandreau Santee Sioux Tribe v. Noem,

938 F.3d 928, 935 (8th Cir. 2019). We can see this in,

among other sources, IGRA’s own declaration of policy,

which states that a purpose of IGRA is to

provide a statutory basis for the regulation of

gaming by an Indian tribe adequate to shield

it from organized crime and other corrupting

influences, to ensure that the Indian tribe is

the primary beneficiary of the gaming

operation, and to assure that gaming is

2

Rincon Band’s analysis on this point was consistent with Coyote

Valley II’s treatment of a labor relations provision that required the tribe

independently to reach an agreement with labor unions “addressing only

organizational and representational rights.” 331 F.3d at 1116. There, we

reasoned that this provision was “directly related to the operation of

gaming activities” because (1) “[w]ithout the ‘operation of gaming

activities,’ the jobs this provision covers would not exist,” and

(2) “Indian gaming activities” could not “operate without someone

performing these jobs.” Id. (quotations omitted). In other words,

because labor at the casinos was necessary to gaming activities and

inseparable from gaming itself, the regulation of that indispensable

element of a casino’s gaming operation was “directly related to the

operation of gaming activities.” 25 U.S.C. § 2710(d)(3)(C)(vii). It was

not sufficient that “the jobs this provision covers would not exist” but for

the operation of gaming activities. Coyote Valley II, 331 F.3d at 1116.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 23

conducted fairly and honestly by both the

operator and players.

25 U.S.C. § 2702(2). These objectives “for the regulation of

gaming” are tied to the operations of the gaming activities

themselves, not to anything that may happen on tribal lands

simply because the tribe has endeavored to build a casino

there.

C

We now turn to the disputed compact provisions and

analyze whether they fall within the catch-all. This inquiry

is an objective one that is not based on the state’s subjective

belief that it was acting reasonably. Rincon Band, 602 F.3d

at 1041. We have little difficulty concluding that the

disputed topics well exceed IGRA’s bounds. While there

may be close cases in which states slightly overstep the

“directly related” to the operation of gaming activities line,

this is not one of them.

Family Law Provisions. California demanded that the

tribes enact ordinances granting their tribal courts

jurisdiction over state spousal and child support orders for

gaming facility employees. Under this proposal, state tribal

courts or tribal hearing officers would be required to

recognize and enforce these family law orders. When the

gaming facility was presented with such an order, it would

then be required to withhold required amounts from an

employee’s paycheck and remit them to the party in whose

favor the judgment was entered.

Environmental Law Provisions. California insisted upon

nearly 30 pages of highly detailed environmental law

provisions. These provisions are sprawling, but some

highlights will show the breadth of California’s ask:

24 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

• Tribes would be required to adopt an

ordinance incorporating as tribal law

significant aspects of California’s

Environmental Quality Act (CEQA) and

the National Environmental Policy Act

(NEPA).

• Tribes could not commence any

construction on any “Project” until the

required environmental processes and

associated disputed resolution procedures

were completed. The term “Project” was

defined expansively to include

“construction of a new Gaming Facility,”

the “renovation, expansion or

modification of an existing Gaming

Facility,” or any “other activity involving

a physical change to the reservation

environment, provided the principal

purpose of which is directly related to the

activities of the Gaming Operation, and

any one of which may cause a Significant

Effect on the Off-Reservation

Environment.” “Gaming Facility” was

itself defined broadly to “include parking

lots, walkways, rooms, buildings, and

areas that provide amenities to Gaming

Activity patrons, if and only if, the

principal purpose of which is to service

the activities of the Gaming Operation.”

• Absent an exemption—exemptions are

themselves a whole further set of

provisions—the tribes would be required

for any qualifying “Project” to prepare

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 25

“Tribal Environmental Impact

Documents” or “Tribal Environmental

Impact Reports,” whose requirements

varied and depended upon the size of the

gaming operation. The Tribal

Environmental Impact Documents, for

example, would address the impacts of a

Project on “(i) air quality; (ii) water

resources; (iii) traffic; (iv) public

services; (v) hazardous materials; and

(vi) noise.”

• Tribes would consent to elaborate

reporting requirements, as well as dispute

resolution mechanisms for any disputes

that arose between the tribes and State

and local governments.

• Tribes would commit to entering

intergovernmental agreements with local

governments before commencing any

Project. These agreements would include

provisions for environmental mitigation

and mitigation of traffic impacts, among

other things. Tribes were further required

to agree to binding arbitration with local

governments concerning

intergovernmental agreements.

Tort Law Provisions. California insisted that the tribes

broadly adopt California tort law as part of tribal law. Tribes

would be required to follow California tort law for

all claims of bodily injury, personal injury, or

property damage directly arising out of,

26 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

connected with, or relating to the operation of

the Gaming Operation, Gaming Facility, or

the Gaming Activities, including but not

limited to injuries resulting from entry onto

the Tribe’s land for purposes of patronizing

the Gaming Facility or providing goods or

services to the Gaming Facility, provided that

such injury occurs at the Gaming Facility or

on a road accessing the Facility exclusively.

Tribes would also be required to waive their sovereign

immunity for tort claims in tribal court and, if the tribe lacks

a tribal court system, to create a tribal claims commission to

resolve covered claims. California further demanded that

tribes agree to employ in tribal courts and claims

commissions discovery procedures analogous to those found

in the California Code of Civil Procedure. Tribes could

require exhaustion of a tribe’s administrative remedies, but

the tribes were required to agree to procedures associated

with those remedies.

We hold that through these various provisions,

California overstepped its proper role under IGRA. Whether

considered separately or as a collective whole, these family,

environmental, and tort law provisions are not “directly

related to the operation of gaming activities.” 25 U.S.C.

§ 2710(d)(3)(C)(vii). Indeed, these disputed provisions have

minimal connection to the operation of gaming activities,

much less the required “direct” relationship. While the

disputed provisions may all reflect worthy policy objectives,

that does not allow California to insist upon them in the

course of negotiating a Class III gaming compact.

It takes very little to see why California has far exceeded

IGRA. Child and spousal support orders have no direct

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 27

relationship whatsoever to the operation of gaming

activities. The environmental provisions would impose

extensive environmental review and reporting obligations on

tribes for a broadly defined set of “Projects” that includes

any physical change “the purpose of which is directly related

to the activities of the Gaming Operation.” That standard is

not found in IGRA, and by California’s requested language

it would include parking lots and walkways, among various

other locations that are at best adjacent to gaming areas. And

then there are the intergovernmental agreements that give

state and local government agencies an apparent veto (or at

least significant control) over tribal projects. All of this is

far afield of the actual operation of gaming activities and the

mitigation of organized crime and unfair gaming practices

that were at the heart of IGRA’s limited extension of

regulatory authority to the states. 25 U.S.C. §§ 2702(2),

2710(d)(3)(C)(vii).

The disputed tort provisions encounter analogous

problems. They would similarly require tribes to commit to

adopting and applying an entire body of state law as tribal

law, waive sovereign immunity, and create claims

commissions for injuries that are merely “connected with”

or “relating to” a casino gaming facility, including injuries

sustained while entering the facility. It is not hard to imagine

the degree to which these provisions would sweep in claims

that have no direct connection to the actual operation of

gaming activities.

And all the disputed provisions, we hasten to add, strike

at core aspects of tribal sovereignty concerning the tribes’

governance over their land and people and their decisions

about how to structure entire areas of tribal law. This cannot

be what Congress had in mind when it enacted statutory text

that gave states modest authority to regulate tribal gaming

28 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

operations through “a very specific exchange of rights and

obligations.” Rincon Band, 602 F.3d at 1039.

Much of California’s defense of the disputed provisions

boils down to the same argument: without Indian gaming

activities, there would be no wages of employees that could

be garnished for spousal and child support orders, no

construction projects that would need to be built to support

gaming, and no relevant personal injuries that would have

occurred on tribal lands. But this is just a reprise of the same

“circular” argument we rejected in Rincon. 602 F.3d at

1033. The catch-all language in § 2710(d)(3)(C)(vii)

requires an affirmative showing that the state is seeking to

negotiate over a subject that has a direct relationship to the

operation of gaming activities. That showing is not made

simply because gaming activities through some chain of

causation produced a situation or event that the state now

believes it imperative to regulate. The logic of California’s

argument is essentially limitless, and it would enable states

to force tribes to agree to all manner of state regulations,

contrary to IGRA’s text, structure, and objectives. See

Rincon Band, 602 F.3d at 1028–29 & n.9; Coyote Valley II,

331 F.3d at 1111.

Finally, we note that our conclusion that California

exceeded the limits of permissible negotiation under

§ 2710(d)(3)(C) is consistent with the Department of

Interior’s recent guidance. As noted above, the Department

of Interior is responsible for approving or rejecting proposed

tribal-state compacts. See 25 U.S.C. § 2710(d)(8). The

Tribes have provided us with recent letters from the

Assistant Secretary of Indian Affairs in the Office of the

Secretary of Interior, issued while this case was on appeal,

in which Interior rejected proposed California compacts

containing provisions essentially identical to those here. In

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 29

fact, the Assistant Secretary refused to approve those

compacts even though there the Tribes had assented to

them. 3

In these letters, Interior rejected the proposed compacts

“as a violation of IGRA because [they] contain[] terms that

are outside of the narrow scope of IGRA approved topics and

are not ‘directly related to the operation of [Class III] gaming

activities.’” Indeed, the letters explained, “we have found

certain provisions blatantly in violation of IGRA,” and many

of them “seek to impose state control where it does not

belong.”

Evaluating a similar compact provision regarding child

and spousal support orders, the Department concluded that

it “violates IGRA because it falls outside the permissible

scope of subjects that may be included in a compact.”

Analyzing similar environmental and intergovernmental

agreement provisions to those here, the Department

concluded that they “fall outside the narrow range of topics

IGRA permits” and thus “must be disapproved.” Indeed, the

Department went on, “requiring a Tribe to adopt state law or

its equivalent and permitting for the State to review and

object to the Tribe’s environmental review is effectively one

step removed from the direct application of State law on the

Tribe’s reservation.” And reviewing a tort provision similar

to the one here, the Department was again “highly concerned

with the State requiring [a] Tribe to adopt a tort claim

3

The letters are similar, but the more comprehensive letter can be

located at https://www.bia.gov/sites/default/files/dup/assets/as-ia/oig/ga

ming_decisions/508%20Compliant%202021.11.23%20Letter%20to%2

0Governor%20-%20Santa%20Rosa%20Compact%20FINAL%20ASIA

.pdf.

30 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

ordinance that could be interpreted to apply to more than just

activity directly related to gaming.”

We do not cite the Department of Interior’s letters as

authoritative, and we acknowledge California’s submission

indicating that it is seeking reconsideration of the decisions

rejecting the compacts at issue. But we find the reasoning in

the Department’s letters persuasive, and it coincides with our

own. 4

IV

A

Having concluded that California substantially exceeded

IGRA’s permissible topics of negotiation, we turn to the next

question: can a state negotiate well outside the enumerated

topics while simultaneously acting in good faith? IGRA

does not supply a direct answer to this question. But its text,

structure, and our precedents confirm that the much better

answer is “no.” When a state, as here, seeks to negotiate for

compact provisions that fall well outside IGRA’s

permissible topics of negotiation, the state does not act in

good faith.

4

The tribes argue that other topics California sought to negotiate,

namely certain labor provisions and a provision establishing a “Tribal

Nation Grant Fund” (TNGF), are also outside IGRA’s scope. California

responds that our decision in Coyote Valley II confirms that these

provisions are allowable. See 331 F.3d at 1110–13 (upholding

provisions concerning a Revenue Sharing Trust Fund and Special

Distribution Fund); id. at 1116 (upholding certain labor provisions). We

need not examine the labor and TNGF provisions in greater detail

because the provisions identified above related to family, environmental,

and tort fall well outside what § 2710(d)(3)(C) permits. And this is

sufficient to show that the state violated its good-faith duty.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 31

We reach this conclusion by returning to the core textual

and structural features of the statute—and the core principles

underlying IGRA—that we set forth above. The defining

feature of IGRA, as the statutory text demonstrates, is that it

sharply limits the permissible topics of negotiation to

prevent states from misusing their compact approval powers

to unduly infringe on tribal sovereignty. 25 U.S.C.

§ 2710(d)(3)(C); Rincon Band, 602 F.3d 1027–29 & n.9;

Coyote Valley II, 331 F.3d at 1111. The exhaustive nature

of IGRA’s enumerated list of permissible topics of

negotiation means nothing if states can ultimately go beyond

that list.

Accordingly, when a state has demanded that a tribe

negotiate on topics well outside IGRA’s scope, it follows

that the state has not negotiated in good faith, end of story.

“IGRA limits permissible subjects of negotiation in order to

ensure that tribal-state compacts cover only those topics that

are related to gaming.” Rincon Band, 602 F.3d at 1028–29

(emphasis added). For that statement to be true—and it

assuredly is based on IGRA’s text—a state that far exceeds

the permissible topics of negotiation cannot be acting in

good faith. Any contrary conclusion would mean that the

seven permitted topics of negotiation are not exhaustive after

all, contrary to the statutory text, our precedents, and IGRA’s

core objectives. 5

5

It is sufficient to resolve this case to conclude that California did

not act in good faith because it sought to negotiate for topics well outside

of IGRA’s permitted list. But contrary to the dissent’s

mischaracterization, we have neither set this as a threshold requirement

nor somehow “create[d] a new atextual test for complying with

§ 2710(d)(3)(C).” Dissent at 76. We have merely described what

California did here. We have no occasion to consider whether a state’s

32 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

B

Our fine dissenting colleague parts ways with us at this

step of the analysis. After agreeing that IGRA’s seven topics

of permissible negotiation are exhaustive and that California

exceeded those topics through its family, environmental, and

tort law proposals, the dissent concludes that California can

still show it was negotiating in good faith. According to the

dissent, California can “establish its good faith despite

negotiating for off-list topics.” Dissent at 66.

In the dissent’s view, “IGRA’s good-faith analysis

works like this”:

(1) If a tribe fails to show that a State

negotiated for topics outside of

§ 2710(d)(3)(C), absent more, it has

failed to meet its initial showing of bad

faith and the inquiry ends.

(2) But if a tribe shows that a State negotiated

on a topic outside the list, it has satisfied

its initial burden of proving bad faith; and

(3) The burden then shifts to the State to

show its good faith under the

§ 2710(d)(7)(B)(iii)(I) factors.

slight or negligible overstep of § 2710(d)(3)(C)’s boundaries should be

treated analogously. But regardless, the dissent’s suggestion that years

of compact negotiations could wind up in litigation if the state proposes

“any topic or proposal minimally outside the list,” Dissent at 77, is a

scenario that is highly unlikely to ever occur in practice given the

realities of the give-and-take compacting process and the tribes’

economic interests in securing a compact.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 33

Dissent at 71. The latter is a reference to an IGRA provision

that we quoted above, which states that “in determining

whether a State has negotiated in good faith, the court” “may

take into account the public interest, public safety,

criminality, financial integrity and adverse economic

impacts on existing gaming activities.” 25 U.S.C.

§ 2710(d)(7)(B)(iii)(I). The dissent believes these good-

faith factors apply to the evaluation of off-list topics of

negotiation, and it would thus remand for the district court

to evaluate the State’s actions under these factors.

The dissent’s position reflects a misunderstanding of the

statutory text that is also at odds with the statute’s core

objectives, as reflected in both the text itself and our

precedents. “IGRA limits permissible subjects of

negotiation in order to ensure that tribal-state compacts

cover only those topics that are related to gaming.” Rincon

Band, 602 F.3d at 1028–29. The dissent squarely contradicts

this core statement of law by maintaining that states may

insist on negotiating topics that are not related to gaming—

and that states that do this can somehow still meet IGRA’s

requirement of good-faith negotiation. The dissent’s

approach would torpedo the statutory scheme, is inconsistent

with our cases, and would inject dramatic uncertainty into

compact negotiations.

1

We begin with the first step in the dissent’s reasoning,

which sets up its entire analytical structure: that if a state

only negotiates within IGRA’s exhaustive list of negotiating

topics, there cannot be a lack of good faith. Dissent at 71.

The dissent qualifies this with an “absent more,” but the

“more” it refers to is “procedural bad faith.” Dissent at 71,

78. So the dissent is thus clear that “if a tribe fails to show

that a State has put off-list topics on the negotiation table,

34 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

then the tribe hasn’t met its initial burden and the State may

prevail” (again, absent evidence of procedural bad faith).

Dissent at 69–70 & n.2. This means, according to the

dissent, that “Congress gives a State free rein to haggle for

permissible gaming-related topics,” and that “greater

scrutiny” is required only “if the State overreaches by

negotiating for topics outside of § 2710(d)(3)(C).” Dissent

at 70 (emphasis added).

The dissent errs at the outset because apart from

procedural failings, a state can still fail to act in good faith

even when it is negotiating within IGRA’s list of exhaustive

topics. Nothing in the statute says, much less suggests, that

a state has “free rein” to insist upon any compact

requirement so long as it fits within the list of seven

permitted topics. For example, § 2710(d)(3)(C)(iii) allows a

state to seek provisions relating to “the assessment by the

State of such [gaming] activities in such amounts as are

necessary to defray the costs of regulating such activity.” If,

for example, a state insisted on highly burdensome and

unnecessary audit procedures, that might provide a basis for

arguing under § 2710(d)(7)(B)(iii)(I)’s good-faith factors

that the state is not negotiating in good faith, even though the

state’s request falls within a substantively permissible topic

of negotiation under IGRA.

The dissent’s position that negotiating for topics within

IGRA’s list cannot be evidence of bad faith is also

inconsistent with Coyote Valley II. There, we held that a

labor provision was within the list of seven permitted topics

and thus an allowed subject of negotiation, but we then

proceeded to evaluate whether the provision was nonetheless

consistent with § 2710(d)(7)(B)(iii)(I)’s good-faith factors.

Coyote Valley II, 331 F.3d at 1115–16. That approach

accords not only with the statutory text, but with common

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 35

sense: just because a given compact requirement is within

the list of seven permitted topics based on subject matter

does not mean the state is acting in good faith by demanding

it. 6

The dissent’s contrary analysis leaves the

§ 2710(d)(7)(B)(iii)(I) good-faith factors with no other work

to do besides applying to the negotiation of impermissible

topics outside the exhaustive list. But because a state does

not necessarily act in good faith by sticking to the list of

permitted topics, § 2710(d)(7)(B)(iii)(I) applies in that

context. This then brings us to the crux of our disagreement

with the dissent: should the good-faith factors in

§ 2710(d)(7)(B)(iii)(I) also apply when, as here, the state has

far exceeded the list of IGRA’s permissible topics of

negotiation? Or is the state’s negotiation of off-list topics

itself sufficient evidence of a lack of good faith, as we have

reasoned above? The dissent chooses the former because, it

tells us, the list of seven topics would otherwise be rendered

“meaningless.” Dissent at 69, 77. But the dissent has it

backwards.

This is one of those classic situations in which a

particular textual provision, here § 2710(d)(7)(B)(iii)(I),

does not tell us when it should apply, but where the rest of

6

The dissent claims that applying § 2710(d)(7)(B)(iii)(I)’s good-

faith factors to on-list negotiation topics would “make complying with

§ 2710(d)(3)(C) nearly meaningless.” Dissent at 77. That is not correct.

To demonstrate its good faith, the state as a threshold matter must, at the

very least, refrain from negotiating well outside the list of permitted

topics in § 2710(d)(3)(C). That there can be a further good-faith inquiry

under § 2710(d)(7)(B)(iii)(I)’s good-faith factors certainly does not

make complying with § 2710(d)(3)(C) meaningless. Indeed, even under

the dissent’s view there is a further inquiry—it is just that the dissent

would look for “procedural” bad faith only. Dissent at 70 n.2.

36 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

the statute and our precedents overwhelmingly demonstrate

the better answer. See Dolan v. U.S. Postal Serv., 546 U.S.

481, 486 (2006) (“Interpretation of a word or phrase depends

upon reading the whole statutory text, considering the

purpose and context of the statute, and consulting any

precedents or authorities that inform the analysis.”). IGRA

is not always a model of clarity, but it provides more than

enough guidance for us to resolve this appeal in favor of the

tribes.

By concluding that the State may still demonstrate its

good faith under § 2710(d)(7)(B)(iii)(I) despite having

negotiated for off-list topics, the dissent renders the

exhaustive list of negotiating topics in § 2710(d)(3)(C) non-

exhaustive. That is directly contrary to the statutory text,

IGRA’s core objectives, and binding circuit precedent,

which all make clear that the list of negotiating topics is

exhaustive, and indeed must be exhaustive, in order to

prevent states from unduly intruding on tribal governance.

See 25 U.S.C. § 2710(d)(3)(C); Rincon Band, 602 F.3d

at 1028–29 & n.10; Coyote Valley II, 331 F.3d at 1111.

Treating a violation of § 2710(d)(3)(C) as definitive proof

that a state did not fulfill its good-faith duty is, therefore, the

only way to give proper meaning to § 2710(d)(3)(C).

For its part, the dissent fully agrees that

§ 2710(d)(3)(C)’s list is “exhaustive,” describing it as

“creat[ing] a binary of on-list/off-list subjects with only on-

list topics permissible for negotiation.” Dissent at 66–67.

But the dissent then refuses to acknowledge the full

implications of this reasoning. Under the dissent’s

framework, negotiating off-list topics is at once strictly

“impermissible,” Dissent at 68, but then ultimately permitted

if a court finds that the state was nonetheless acting in good

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 37

faith under § 2710(d)(7)(B)(iii)(I). We should not interpret

the statute to be at war with itself. 7

Of course, under our interpretation

§ 2710(d)(7)(B)(iii)(I)’s good-faith factors still have plenty

of work to do; we certainly have not “erase[d] these factors

from the statute,” as the dissent grandiosely charges. Dissent

at 74. The § 2710(d)(7)(B)(iii)(I) factors require analysis

when a state seeks to negotiate within the seven topics, but

when the specific nature of the state’s request is such that an

inference of bad faith still arises (remember the oppressive

audit procedures hypothetical). But extending

§ 2710(d)(7)(B)(iii)(I) outside that context to off-list

negotiation topics, as the dissent proposes, would render the

exhaustive list of negotiating topics non-exhaustive, which

is unacceptable as a matter of both statutory interpretation

and governing precedent. Rincon Band also repeatedly

invoked the canon of construction construing ambiguous

laws in favor of tribal interests, see 602 F.3d at 1028 n.9,

1031 n.14, 1032, and that canon cuts firmly against the

dissent’s interpretation as well.

In addition, our interpretation of § 2710(d)(7)(B)(iii)(I)

is one this particular provision readily permits. That section

directs that the court “may take into account the public

interest, public safety, criminality, financial integrity and

adverse economic impacts on existing gaming activities.”

25 U.S.C. § 2710(d)(7)(B)(iii)(I) (emphasis added). The

very next provision says that the court “shall consider any

7

We could also restate our conclusion this way: even if the

§ 2710(d)(7)(B)(iii)(I) factors could apply to topics well outside

§ 2710(d)(3)(C)’s list, the good-faith factors necessarily cannot be

satisfied in that circumstance, or else (again) the list of seven permitted

topics of negotiation would not be exhaustive.

38 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

demand by the State for direct taxation of the Indian tribe or

of any Indian lands as evidence that the State has not

negotiated in good faith.” Id. § 2710(d)(7)(B)(iii)(II)

(emphasis added).

Although “may” must mean “may only” in the context

of the list of permitted negotiation topics in § 2710(d)(3)(C),

we think § 2710(d)(7)(B)(iii)(I) is quite different. The

structure of § 2710(d)(7)(B)(iii)(I) is dissimilar from that of

§ 2710(d)(3)(C) and does not consist of an itemized list

punctuated by a catch-all. In addition, the juxtaposition of

the “may” and “shall” directives in the two adjoining sub-

provisions of § 2710(d)(7)(B)(iii) strongly suggests that in

§ 2710(d)(7)(B)(iii)(I), “may” should really just mean the

optional “may.” The word “may” thus gives us ample

textual room to choose an interpretation that does not

undermine the rest of the statute.

Also wrong is the dissent’s attempt to claim that Rincon

Band supports its interpretation of § 2710(d)(7)(B)(iii)(I).

Purporting to quote Rincon Band, the dissent says that “‘the

State may attempt to rebut bad faith’ by showing that any

off-list topic was justified by ‘the public interest, public

safety, criminality, financial integrity, and adverse economic

impacts on existing gaming activities.’” Dissent at 66

(quoting Rincon Band, 602 F.3d at 1032). The problem is

that the dissent through selective quotation has changed the

meaning of the quote, and thus the case as a whole.

The actual line from Rincon Band is: “the State may

attempt to rebut bad faith by demonstrating that the revenue

demanded was to be used for the public interest, public

safety, criminality, financial integrity, and adverse economic

impacts on existing gaming activities.” Rincon Band,

602 F.3d at 1032 (quotations omitted; emphasis added). The

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 39

dissent errs because revenue demands are not categorically

equivalent to “any off-list topic” under IGRA.

To the contrary, a wholly separate statutory provision

governs how demands for revenue inform the good faith

analysis. See 25 U.S.C. § 2710(d)(7)(B)(iii)(II). That

provision, as we noted above, states that courts “shall

consider any demand by the State for direct taxation of the

Indian tribe or of any Indian lands as evidence that the State

has not negotiated in good faith.” Id. (emphasis added).

Some assessments are within the permitted topics of

negotiation, see id. § 2710(d)(3)(C)(iii), but another

provision states that “nothing in this section shall be

interpreted as conferring upon a State or any of its political

subdivisions authority to impose any tax, fee, charge, or

other assessment upon an Indian tribe.” Id. § 2710(d)(4).

Bound by Coyote Valley II and its treatment of revenue-

sharing provisions, Rincon Band explained that “IGRA

requires courts to consider a state’s demand for taxation as

evidence of bad faith, not conclusive proof.” 602 F.3d

at 1032 (citing Coyote Valley II, 331 F.3d at 1112–13).

Rincon Band thus analyzed at length whether the State had

provided “meaningful concessions” for a revenue-sharing

requirement. See id. at 1036–40. As we will explain in detail

below, a “meaningful concessions” analysis only applies

within the context of § 2710(d)(4), to revenue-sharing

demands (a point the dissent does not dispute). But that only

confirms the dissent’s error in selectively quoting Rincon

Band. Rincon Band did not hold that off-list negotiations

were subject to a further good-faith analysis under

§ 2710(d)(7)(B)(iii)(I). It instead held that “IGRA limits

permissible subjects of negotiation in order to ensure that

tribal-state compacts cover only those topics that are related

to gaming.” Rincon Band, 602 F.3d at 1028–29 (emphasis

40 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

added). If the dissent had its way, that would no longer be

true. 8

The dissent’s heavy reliance on IGRA’s burden-shifting

framework, see 25 U.S.C. § 2510(d)(7)(B)(ii), is thus a non

sequitur. Dissent at 68–69. That the burden may shift to the

state to demonstrate its good faith says nothing about

whether and when the state will be able to meet its burden.

And here we find it inconceivable that the Congress that

ringfenced the permissible topics of negotiation to prevent

states from encroaching on tribal sovereignty, see Rincon

Band, 602 F.3d at 1028–29 & n.9; Coyote Valley II, 331 F.3d

at 1111, would at the same time give states the opportunity

to maintain, in both compact negotiations and before courts,

that their off-list topics are nonetheless reasonable. See

Quarles v. United States, 139 S. Ct. 1872, 1879 (2019) (“We

should not lightly conclude that Congress enacted a self-

defeating statute.”).

2

The dissent’s approach would also destabilize the

compact negotiation process, creating significant

uncertainty for vital rights of tribal self-governance and

dragging out compact negotiations. Section

2710(d)(7)(B)(iii)(I) allows courts to “take into account the

8

The dissent asserts that our approach “is divorced from the text” of

§ 2710(d)(7)(B)(iii)(II) because “[i]f any off-list negotiation constituted

automatic bad faith (as the majority contends), there would be no point

in making ‘direct taxation of the Indian tribe’ evidence of bad faith since

that topic is already outside the list of permissible subjects.” Dissent

at 75–76. Not so. A negotiated provision may be characterized as a

direct tax and also fall within a permissible topic of negotiation. There

are also specific on-list topics of negotiation relating to “assessment[s].”

Id. § 2710(d)(3)(C)(iii).

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 41

public interest, public safety, criminality, financial integrity,

and adverse economic impacts on existing gaming

activities.” Any compact provision that a state could

demand may plausibly be said to be in the “public interest”

or have a sufficient relationship to one or more of these

good-faith factors. Environmental regulation can be said to

be in the public interest. The same is true of spousal support

payments.

Contrary to the dissent’s suggestion, we are not

“wonder[ing] why Congress inserted the good-faith factors

into IGRA.” Dissent at 73. We do not question that choice

at all. But that choice does not answer the question of when

those factors apply. And there is no reason to believe that a

Congress that set up an exhaustive list of topics of

negotiation to preserve tribal sovereignty, 25 U.S.C.

§ 2710(d)(3)(C), would choose to undermine that crystalline

textual objective through the particular choice of these good-

faith factors.

In an effort to bring clarity to its approach, the dissent

attempts to assure us that the good faith factors in

§ 2710(d)(7)(B)(iii)(I) must be still interpreted in a way that

sufficiently relates to gaming and the purposes of IGRA.

Dissent at 70. But the dissent provides no guidance beyond

that. And it would set the district court on the seemingly

hopeless mission of determining whether negotiation topics

that are not even “directly related to the operation of gaming

activities,” 25 U.S.C. § 2710(d)(3)(C)(vii), are nonetheless

sufficiently tied to the State’s interest in regulating gaming

and the purposes of IGRA, so as to somehow demonstrate

the State’s good faith. Dissent at 70–72.

To make matters more confounding, under the dissent’s

view the district court would need to undertake this

enigmatic good-faith analysis even though many of the

42 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

State’s off-list topics, such as extensive family,

environmental, and tort regulation, strike at the core of the

Tribes’ governance over their land and people. If the dissent

were the law, it is entirely unclear what evidence the parties

would be required to marshal on remand, much less how the

district court is supposed to go about resolving the further

good-faith question.

The substantial uncertainty that the dissent’s approach

would create is itself directly contrary to IGRA and our

precedents. We said in Rincon Band that “the function of

the good faith requirement and judicial remedy is to permit

the tribe to process gaming arrangements on an expedited

basis, not to embroil the parties in litigation over their

subjective motivations.” 602 F.3d at 1041. The dissent

would produce exactly what Rincon Band sought to avoid.

The result of the dissent’s approach would be that every

topic would be in play in tribal-state compact negotiations

until things could eventually get sorted out in court. The

compacting parties would thus not learn the rules of

engagement until litigation over their negotiation process

was complete. This would give states enormous leverage at

the negotiating table—leverage Congress did not want states

to have. And it means that it would take years for compact

disputes to get resolved.

Of course, the irony in the dissent’s approach is that if a

state is ultimately able to persuade a court that it acted in

good faith and its disputed provisions remain in the compact

(or the tribes cave to them), there is no present likelihood

that the Secretary of the Interior would even approve such

an arrangement. As we discussed above, the Department of

Interior has recently refused to approve compacts with

provisions like California’s, even though there the State and

the Tribes had agreed to them. It is hard to see the wisdom

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 43

(or basis in law) for forcing the parties and the district court

into further proceedings on a compact that the Department

of Interior has telegraphed it will reject. 9

The dissent’s main rejoinder to everything we have said

in this opinion is that we are relying on our own “sense of

IGRA’s core ‘principles’ and ‘objectives.’” Dissent at 72.

But the dissent’s bromides about the role of judges do little

to advance the dialogue here. The disagreement between us

is over how to interpret statutory text, within the confines of

a methodology that treats statutory language and structure as

the only true indicators of legislative intent. The dissent’s

interpretation narrowly focuses on the good-faith factors in

§ 2710(d)(7)(B)(iii)(I), with no appreciation for how that

interpretation fundamentally destroys the core textual and

structural feature of the statute it purports to interpret. Our

interpretation considers the language of

§ 2710(d)(7)(B)(iii)(I) within the context of the statute as a

whole. And in that sense, our interpretation—which is based

on statutory language and precedent, not unenacted statutory

purpose—is more faithful to the text and structure of the

statute that Congress enacted. The dissent’s assertion that

we are “divin[ing] some broad legislative purpose” to

“override the statue’s plain meaning” is therefore simply

unfounded. Dissent at 73. And the dissent repeatedly

invoking the jargon of textualist interpretation does not make

its interpretation textually sound.

9

We agree with the dissent that “IGRA’s text governs irrespective

of Interior officials’ future judgment calls.” Dissent at 74 n.3. But here

IGRA’s text and structure comport with Interior’s analysis.

44 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

V

The district court agreed that California had not

negotiated in good faith and that IGRA’s remedial

provisions were triggered. But it reached this same result

through a different path. Because it may affect the parties’

future negotiations and the IGRA remedial process, we take

this opportunity to explain why the district court’s approach

rested on a mistaken understanding of our precedents.

As we recounted above, the district court concluded that

because various of the State’s negotiating demands were at

the outer edge of relevance to gaming, to demonstrate its

good faith the State was required to provide “meaningful

concessions” in return. The State argued in the district court

that it had offered to provide the Tribes with particularly

valuable consideration in exchange for the disputed

provisions. But the district court found that these

concessions were insufficiently specific to the State’s

particular compact demands. The district court

acknowledged that “[t]he Ninth Circuit has only discussed

‘meaningful concessions’ in the context of fee demands,”

but believed that framework could be expanded to other

topics of negotiation.

The district court erred in relying on the “meaningful

concessions” framework. We first introduced the analytical

concept of “meaningful concessions” in Coyote Valley II.

There we considered the State’s insistence on a provision in

the 1999 tribal-state compact that would create a Revenue

Sharing Trust Fund (RSTF). 331 F.3d at 1110. The RSTF

would have required that gaming tribes share their gaming

revenue with tribes that did not have gaming operations. Id.

The Tribes maintained that the State had not negotiated in

good faith, claiming that the requested RSTF provision was

a prohibited tax under § 2710(d)(4). See id. That provision,

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 45

as we noted above, states that “nothing in this section shall

be interpreted as conferring upon a State or any of its

political subdivisions authority to impose any tax, fee,

charge, or other assessment upon an Indian tribe or upon any

other person or entity authorized by an Indian tribe to engage

in a class III activity.” 25 U.S.C. § 2710(d)(4).

We held that California had acted in good faith in

requesting the RSTF provision. We first made clear that this

was a permissible topic of negotiation because

“§ 2710(d)(3)(C)(vii) authorizes the RSTF provision.”

Coyote Valley II, 331 F.3d at 1111; see also id. (“It is clear

that the RSTF provision falls within the scope of

paragraph(3)(C)(vii).”). We then explained that the RSTF

provision did not run afoul of § 2710(d)(4)’s prohibition on

taxes in light of the State’s meaningful concessions: “Given

that the State offered meaningful concessions in return for

its demands, it did not ‘impose’ the RSTF within the

meaning of § 2710(d)(4).” Id. Through these meaningful

concessions, we held, “the State ha[d] successfully rebutted

any inference of bad faith.” Id.

We addressed “meaningful concessions” again in Rincon

Band. There, we considered California’s request during

renegotiations of the 1999 compacts that tribes pay a

significant portion of net gaming revenues into the State’s

general fund. 602 F.3d at 1022. We first held, as recounted

above, that the general revenue sharing provision was not

“directly related to the operation of gaming activities,”

rejecting the State’s argument as “circular.” Id. at 1033; see

also id. at 1034. We then reasoned that even if general

revenue sharing were a permissible topic of negotiation, the

State had still failed to act in good faith because it had not

provided meaningful concessions. Id. at 1036–40.

46 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

Properly considered, a “meaningful concessions”

analysis does not apply in this case, for two reasons. First,

we have never held that the “meaningful concessions”

doctrine applies to requested topics of negotiation that are

well outside the seven permitted topics in § 2710(d)(3)(C).

That is, a state cannot negotiate well outside the bounds of

§ 2710(d)(3)(C) and then attempt to excuse this by arguing

that it provided extra goodies in the negotiation package.

The reason is the same reason that we do not further analyze

the good faith factors in § 2710(d)(7)(B)(iii)(I) when it

comes to off-list topics: if states were permitted to offer

meaningful concessions in exchange for negotiating for

topics well beyond IGRA’s permitted list, Congress’s entire

scheme of limiting the parties to topics directly related to

gaming operations would be fatally undermined. Allowing

a meaningful concessions analysis to supersede

§ 2710(d)(3)(C) would mean that compacts could be “used

as a subterfuge for imposing State jurisdiction on tribes

concerning issues unrelated to gaming.” Coyote Valley II,

331 F.3d at 1111.

This conclusion coheres with how we approached the

“meaningful concessions” issue in Coyote Valley II. There,

we were careful to address meaningful concessions only

after concluding that the disputed provisions fell within the

scope of permissible negotiation subjects under

§ 2710(d)(3)(C). See id. at 1111–15. In Rincon Band, we

thus explained that “Coyote Valley II thus stands for the

proposition” that a state may request revenue sharing

provisions if backed by meaningful concessions, but only “if

the revenue sharing provision is . . . for uses ‘directly related

to the operation of gaming activities’ in

§ 2710(d)(3)(C)(vii).” 602 F.3d at 1033. We have never

suggested that a state could point to material concessions

that it offered in return for bargaining well outside the

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 47

allowed seven topics. We specifically reject that notion

here.

Second, even when a state seeks to negotiate on a topic

within § 2710(d)(3)(C), a meaningful concessions

requirement still only applies to demands for taxes, fees, or

other revenue-sharing provisions. This is due to the specific

prohibitory language in IGRA relating to states seeking to

“impose” taxes or other assessments on tribes.

Section 2710(d)(4) provides that except for assessments

agreed to under § 2710(d)(3)(C)(iii), “nothing in this section

shall be interpreted as conferring upon a state or any of its

political subdivisions authority to impose any tax, fee,

charge, or other assessment upon an Indian tribe.” 25 U.S.C.

§ 2710(d)(4) (emphasis added).

The material concessions requirement is based on states’

need to avoid “imposing” such improper taxes. As we

explained in Rincon Band, “[t]he relevance of ‘meaningful

concessions’ arises from § 2710(d)(4).” 602 F.3d at 1036.

That is, offering material concessions allows a state to

negotiate for certain revenue-sharing provisions without

running afoul of § 2710(d)(4). As we explained in Coyote

Valley II, when “a State offers meaningful concessions in

return for fee demands, it does not exercise ‘authority to

impose’ anything.” 331 F.3d at 1112; see also at 1111

(“Given that the State offered meaningful concessions in

return for its demands, it did not ‘impose’ the RSFT within

the meaning of § 2710(d)(4).”).

Provisions that do not concern taxes, fees, or revenue-

sharing, by contrast, are not subject to the § 2710(d)(4)

prohibition that the state not “impose” such requirements.

Thus, to the extent a state negotiates within the enumerated

topics in § 2710(d)(3)(C), for a state to act in good faith there

is no further affirmative requirement to demonstrate material

48 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

concessions, unless the provision sought concerns taxes or

fees. 10 Because the State here negotiated well outside

§ 2710(d)(3)(C) and the disputed family, environmental, and

tort law provisions did not involve revenue sharing, the

district court erred in considering the State’s good faith

through a meaningful concessions lens, even as the district

court ultimately reached the correct result in this case.

* * *

“[T]he good faith requirement exists” because

“Congress anticipated that states might abuse their authority

over compact negotiations to force tribes to accept burdens

on their sovereignty in order to obtain gaming

opportunities.” Rincon Band, 602 F.3d at 1042. We hold

that by negotiating for topics well outside § 2710(d)(3)(C)’s

permitted list, California did not bargain in good faith. We

therefore direct the parties to proceed to IGRA’s remedial

framework under the district court’s continued supervision.

AFFIRMED.

10

Although material concessions is not a requirement outside the

revenue-sharing context, IGRA does not prevent a state from showcasing

its claimed meaningful concessions in attempting to demonstrate its good

faith (when the state is not otherwise negotiating well outside

§ 2710(d)(3)’s permitted topics). That is the import of our glancing

reference to material concessions in discussing the labor relations

provision at issue in Coyote Valley II. 331 F.3d at 1115–16. There, after

explaining that the provision fell within a permitted topic of negotiation

and was consistent with the “good faith” factors in

§ 2710(d)(7)(B)(iii)(I), we observed that the State had also “offered

numerous concessions to the Tribes in return for the . . . provision.” Id.

at 1116. So although we did not impose a material concessions

requirement as to this provision, the concessions could still be relevant

in evaluating the State’s claimed good faith.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 49

WARDLAW, Circuit Judge, concurring:

The Indian Gaming Regulatory Act (IGRA) is

ambiguous on the central question this case presents:

whether a state conducts Tribal-State Compact negotiations

in bad faith when it insists on negotiating topics beyond the

exclusive topics set forth in IGRA § 2710(d)(3)(C).

Congress did not clearly explain how the exhaustive list of

negotiating topics interacts with the good faith burden-

shifting provisions that apply once a tribe files an

enforcement action; nor did it define “good faith” to include

or exclude the State’s introduction of unauthorized topics.

In answering the question presented, my fine colleagues

confine themselves to the text of the statute and our

precedents construing IGRA—and reach equally plausible,

but diametrically opposed, conclusions. Judge Bumatay

would layer the burden-shifting provision on top of both on-

topic and off-topic negotiations, while Judge Bress

concludes that if the State injects an off-topic term into the

negotiations, that is sufficient for a finding of bad faith,

which triggers IGRA’s remedial provisions.

I agree with Judge Bress’s analysis of the text and

structure of IGRA. My agreement with his conclusions,

however, is further supported by IGRA’s stated purpose and

its legislative history. Moreover, given the inherently

ambiguous nature of IGRA’s statutory text and structure, it

is helpful to bear in mind the words of Justice Scalia thirty

years ago:

When we are faced with these two possible

constructions [of a federal statute implicating

Tribal interests], our choice between them

must be dictated by a principle deeply rooted

in this Court’s Indian jurisprudence: statutes

50 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

are to be construed liberally in favor of the

Indians, with ambiguous provisions

interpreted to their benefit.

Cnty. of Yakima v. Confederated Tribes, 502 U.S. 251, 269

(1992) (cleaned up). 1 These additional considerations lead

me to conclude that when a state insists on negotiating topics

that are not even arguably related to “the operation of

gaming activities,” as California did here, the State has not

conducted such negotiations in good faith under IGRA. I

therefore concur in Judge Bress’s majority opinion.

I.

Although the federal government has the power to grant

states jurisdiction over tribal affairs, see McClanahan v.

State Tax Comm'n of Ariz., 411 U.S. 164, 170–71 (1973), it

has rarely exercised that power in light of the historically

fraught relationship between states and tribes.

“The policy of leaving Indians free from state

jurisdiction and control is deeply rooted in the Nation’s

history.” Rice v. Olson, 324 U.S. 786, 789 (1945). For

centuries, states have been the “deadliest enemies” of tribes,

United States v. Kagama, 118 U.S. 375, 384 (1886), and the

entities “least inclined to respect” tribal sovereignty, McGirt

1

This principle has been cemented into law as one of the Indian law

canons of construction. See, e.g., Cohen’s Handbook of Federal Indian

Law § 2.02 [1] (2019) (“The basic Indian law canons of construction

require that treaties, agreements, statutes, and executive orders be

liberally construed in favor of the Indians and that all ambiguities are to

be resolved in their favor.”) (emphasis added).

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 51

v. Oklahoma, 140 S. Ct. 2452, 2462 (2020). 2 Accordingly,

delegations of jurisdiction over tribal affairs to states have

been perceived as an abandonment of the federal

government’s duty to safeguard tribal sovereignty. As the

Supreme Court put it in 1886:

[Tribes] owe no allegiance to the states, and

receive from them no protection. Because of

the local ill feeling, the people of the states

where they are found are often their deadliest

enemies. From their very weakness and

helplessness, so largely due to the course of

dealing of the federal government with them,

and the treaties in which it has been

promised, there arises the duty of protection,

and with it the power. This has always been

recognized by the executive, and by

congress, and by this court, whenever the

question has arisen.

Kagama, 118 U.S. at 384.

2

See also Matthrew L.M. Fletcher, Retiring the “Deadliest

Enemies” Model of Tribal-State Relations, 43 Tulsa L. Rev. 73, 77–78

(2007) (explaining that during the 19th Century “States and their

constituents were in a never-ending quest to take Indian lands and

resources and, in some circumstances, to eliminate Indians and Indian

tribes . . . State and local governments on or near Indian Country have

long histories of using apparent legal authority and simple force to

dispossess Indian people of land and property. On numerous occasions,

the use of simple force has exploded into the use of deadly force—in

short, the mass murder of Indian people in states like Massachusetts,

Colorado, and California”).

52 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

Congress enacted IGRA following the Supreme Court’s

ruling that California lacked Pub. L. 280 authority 3 to

regulate bingo (or other gaming) on tribal lands in California

v. Cabazon Band of Mission Indians, 480 U.S. 202 (1987).

The Cabazon holding was itself rooted in “traditional

notions of Indian sovereignty and the congressional goal of

Indian self-government, including its overriding goal of

encouraging tribal self-sufficiency and economic

development.” Id. at 216 (cleaned up).

Congress’s choice to involve states in regulating gaming

was controversial. When Congress began debating IGRA,

there was widespread agreement about its twin goals.

IGRA’s first purpose in legalizing gaming on Indian lands

was “as a means of promoting tribal economic development,

self-sufficiency, and strong tribal governments.” 25 U.S.C.

§ 2702; see also S. Rep. No. 100-446, at *1–2 (1988). Its

second purpose was to regulate gaming on Indian lands in a

manner that would “shield it from organized crime and other

corrupting influences.” 25 U.S.C. § 2702. The difficulty

Congress faced was how to structure a regulatory scheme

that would meet both purposes, i.e., a scheme that would

3

In Pub. L. 280, Congress granted certain states broad criminal

jurisdiction within Indian country and civil jurisdiction limited to private

civil litigation involving reservation Indians in state court. See Cabazon,

480 U.S. at 207–08. The Cabazon Court concluded that California’s

regulation of bingo was civil in nature, and did not fall within the Pub.

L. 280 grant of civil jurisdiction, and therefore, Pub. L. 280 states had no

authority to regulate gaming on Indian land. Id. at 210.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 53

effectively deter corruption, but did not undermine tribal

sovereignty. 4

In an effort to ensure the proposed regulation did not

infringe on tribal sovereignty more than was essential,

Congress assigned regulatory authority according to three

“classes” of gaming. It divided the classes based on how

lucrative they were, reasoning that more lucrative games

were more likely to be the target of “corrupting influences.” 5

Class I games, including traditional tribal games associated

with tribal ceremonies and celebrations, which posed “little

risk of corruption,” were regulated exclusively by the tribes. 6

Class II games, which included Bingo and other games

which tribes had regulated on their own for decades with

“relatively few problems,” were regulated by the tribes with

some oversight by the federal government. 7

The regulation of Class III gaming proved trickier. On

the one hand, there was relatively widespread agreement that

mere federal oversight would not be sufficient. As one

commentator explained:

Congress saw casino-style gambling as

carrying greater risks and raising different

4

See S. Rep. No. 100-446, at *1–2 (1988) (“In developing the

legislation, the issue has been how best to preserve the right of tribes to

self-government while, at the same time, to protect both the tribes and

the gaming public from unscrupulous persons.”).

5

Kathryn Rand & Steven Light, How Congress Can and Should

“Fix” the Indian Gaming Regulatory Act: Recommendations for Law

and Policy Reform, 13 Virginia J. Soc. P. & L. 396, 409 (2006).

6

Id.

7

Id.

54 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

issues than bingo. The states' interests in

preventing the infiltration of organized crime

and controlling gambling generally appeared

most persuasive in the context of the "cash

business" of casino-style gaming, or "Class

III" gaming. 8

However, it was not obvious what form of regulatory

authority should take its place. “Recognizing that the

extension of State jurisdiction on Indian lands has

traditionally been inimical to Indian interests,” one early

version of the bill proposed creating a new federal body,

housed within either the Department of Justice (DOJ) or the

Department of the Interior (DOI), which would be

responsible for regulating Class III gaming. 9 However, both

Departments vigorously opposed that proposal. 10 DOJ

resisted the role, asserting that it wasn’t a “regulatory

agency,” and was therefore ill suited to the role. 11 DOI

representatives testified that the Department “did not have

the capacity to undertake such a mission and that,

furthermore, it would be in conflict with the Department's

8

Id. (cleaned up).

9

S. Rep. 100-446, at *5 (1988); see also Franklin Ducheneaux, The

Indian Gaming Regulatory Act: Background and Legislative History,

42 Arizona St. L.J. 99, 115–19 (2010).

10

See Virginia Boylan, Reflections on IGRA 20 Years after

Enactment, 42 Ariz. St. L.J. 1, 6 (2010) (explaining that both agencies

“adamantly opposed federal regulation of class III gaming”).

11

See Ducheneaux, supra note 9, at 121 (citing Indian Gambling

Control Act: Hearing on H.R. 4566 Before the H. Comm. on Interior and

Insular Affairs, 98th Congress at 26–28 (1984)).

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 55

effort to reduce its past paternalistic role in favor of support

for tribal independence and self-determination.” 12

An alternate proposal, drafted by DOJ, suggested that

Congress delegate responsibility for regulating Class III

gaming to the states. 13 Proponents of this plan, including

DOI, pointed out that states were well suited to the role

because they already regulated gaming within their borders,

and therefore had the regulatory infrastructure in place. 14

Unsurprisingly, tribes as well as a number of members

objected to that plan, expressing concern that “state

regulation of tribal gaming would violate tribal sovereignty

and, on a more practical level, undermine tribal gaming as

an economic development strategy,” as states might try to

protect their own competing gaming operations, like

lotteries. 15 For example, Senator McCain testified to his

belief that the states, if given jurisdiction over gaming on

Indian lands, would not give the “Indians a fair shake.” 16

Those concerns were particularly salient based on the states’

recent attempts to eradicate tribal gaming entirely, including

12

Id. at 121–22 (citing Indian Gambling Control Act: Hearing on

H.R. 4566 Before the H. Comm. on Interior and Insular Affairs, 98th

Congress at 31 (1984)).

13

Id. at 112.

14

See Boylan, supra note 10, at 6.

15

See Rand and Light, supra note 5, at 409.

16

Gaming Activities on Indian Reservations and Lands: Hearings

on S. 555 and S. 1303 Before the Senate Select Comm. on Indian Affairs,

100th Cong., 1st Sess. (1987) (statement of Sen. John McCain, III, R-

Ariz.); see also Ronald Santoni, The Indian Gaming Regulatory Act:

How Did We Get Here? Where Are We Going? 26 Creighton L. Rev.

387, 403, 411 (1993).

56 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

California’s failed effort to regulate tribal gaming to the

point of extinction. See Cabazon, 480 U.S. at 205–06.

The Tribal-State Compact provision finally enacted was

a grand compromise. 17 States were given a role in regulating

Class III gaming because federal agencies did not want

responsibility for it, and states already had relevant

expertise. 18 However, that role was strictly limited to ensure

that states could not demand inappropriate concessions from

tribes or use Compacts “as a subterfuge for imposing State

jurisdiction on tribal lands.” 19 Therefore, Tribal-State

Compacts could only include provisions that related to “the

issues” listed in § 2710(d)(3)(C)—those “directly related to

gaming.” 20 The Senate Report does not specifically discuss

how Congress intended the exclusive negotiating topic

provision to relate to the good faith negotiation requirement.

17

See S. Rep. No. 100-446, at *13 (1988) (“After lengthy hearings,

negotiations and discussions, the Committee concluded that the use of

compacts between tribes and states is the best mechanism to assure that

the interests of both sovereign entities are met with respect to the

regulation of complex gaming enterprises . . . The Committee notes the

strong concerns of states that state laws and regulations relating to

sophisticated forms of class III gaming be respected on Indian lands

where, with few exceptions, such laws and regulations do not now apply.

The Committee balanced these concerns against the strong tribal

opposition to any imposition of State jurisdiction over activities on

Indian lands. The Committee concluded that the compact process is a

viable mechanism for settling various matters between two equal

sovereigns.”) (cleaned up).

18

Id. at *13–14 (“[T]he committee notes that there is no adequate

Federal regulatory system in place for class III gaming . . . Thus a logical

choice is to make use of existing State regulatory systems . . . .”).

19

Id. at *14

20

Id. at *14, 18

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 57

However, it is clear that the limit on negotiation topics was

the barrier erected against state overreach, while the good

faith requirement was the “incentive” to ensure that States

“deal[t] fairly with tribes as sovereign governments.” 21

Several members concerned with tribal rights only

reluctantly agreed to grant states regulatory authority over

even Class III gaming. They stated that they did so only

because of the strong protections the legislation afforded

tribes should states exceed their bounds. 22 For example,

Senator Evans issued a statement that he supported the bill

“with great reluctance,” 23 even accounting for the limited

scope of state intervention allowed:

We intend that the two sovereigns—the tribes

and the States—will sit down together in

negotiations on equal terms and come up with

a recommended methodology for regulating

class III gaming on Indian lands. Permitting

21

Id. at *13, 14.

22

If a federal district court determines that a State has not negotiated

with a tribe in good faith, a mandatory multi-step remedial process is

triggered. First, the court must order the parties to conclude a Compact

within 60 days. § 2710(d)(7)(B)(iii). If the State and the tribe fail to

conclude a Compact within that 60-day period, the Court must order the

tribe and the State to submit their “last best offer for a Compact” to a

court-appointed mediator, who “select[s] from the two proposed

compacts the one which best comports with the terms of this chapter and

any other applicable Federal law and with the findings and order of the

court.” § 2710(d)(7)(B)(iv). If the State does not consent to the Compact

selected by the mediator within 60 days, then the mediator must notify

the Secretary of the Interior, who in turn must prescribe procedures

consistent with the selected contract under which Class III gaming can

be conducted on the tribe’s land. § 2710(d)(7)(B)(vii).

23

See S. Rep. No. 100-446, at *35.

58 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

the States even this limited say in matters that

are usually in the exclusive domain of tribal

government has been permitted only with

extreme reluctance. 24

Senator McCain similarly stated that, “[i]t is with great

reluctance that I am supporting [IGRA],” and emphasized

that he had only done so due to the limited nature of the

state’s involvement:

The Committee Report is clear as to the

purpose of Tribal/State compacts as called

for in Section [2710(d)]. I understand Senator

Evans’ concerns regarding the potential

overextension of the intended scope of the

Tribal/State compact approach. Toward this

end, I believe it is important to again

underscore the statement that appears on

page 10 of the Report: “The Committee does

not intend to authorize any wholesale transfer

of jurisdiction from a tribe to a state.” From

time immemorial, Tribes have been and will

continue to be permanent governmental

bodies exercising those basic powers of

government, as do Federal and State

governments, to fulfill the needs of their

members. Under our constitutional system of

government, the right of Tribes to be self-

24

134 Cong. Rec. S12643 (Sept. 15, 1988) (statement of Sen. Daniel

Evans R-Wash.) (emphasis added).

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 59

governing and to share in our federal system

must not be diminished. 25

II.

In light of IGRA’s purpose to facilitate tribes’ operation

of gaming activities, and Congress’s reluctance to allow

states to have any involvement in oversight of even Class III

gaming, I agree with Judge Bress that when a state insists

upon negotiating topics plainly beyond the scope of

§ 2710(d)(3)(C)(vii), that is per se bad faith.

This case is a textbook example of how a contrary

interpretation would undermine IGRA’s purposes.

California began negotiations with the Compact Tribe

Steering Committee (CTSC) nearly eight years ago, in 2014.

From the start of those negotiations, the State demanded that

the final Compact include a number of provisions not even

tangentially related to gaming. For example, the State

demanded that the Tribes adopt state tort law, subject

themselves to state environmental regulations, and enforce

state child and spousal support orders against their members.

California’s insistence on those provisions eventually led the

Plaintiff tribes to pull out of the CTSC in 2019, reject the

State’s offer, and initiate this suit, which has now dragged

on for more than three years.

If we were to adopt Judge Bumatay’s position, hold that

the State could justify its insistence on those terms by

showing that they were in the “public interest,” and remand

this case to the district court for further proceedings,

Congress’s objectives would be frustrated in at least two key

ways. First, it would subject the Tribes to even more costly

25

S. Rep. No. 100-446, at *33–34.

60 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

delays, and potentially jeopardize their ability to engage in

gaming at all, as due to these failed negotiations, the existing

Compact authorizing gaming was on the brink of expiring

until the parties extended its end date from June 2022 to

December 2023. Second, it would fatally undermine the key

barrier Congress erected against states’ overreach in

regulating tribal gaming. If a state could insist on topics as

far afield as spousal and child support so long as they were

in the “public interest,” the “exhaustive” list of topics

wouldn’t be exhaustive at all. And in that event, the worst

fears of Congressional members—that states would place

their interests above the tribes’—would be realized.

III.

This conclusion is bolstered by the application of

traditional Indian canons of construction. As my colleagues’

competing views demonstrate, the statutory language is

ambiguous. When a statute is ambiguous, we apply the

Indian canons of construction, one of which the Supreme

Court codified in County of Yakima. As noted at the outset,

where, as here, we are faced with two possible constructions

of a federal statute implicating tribal interests, “our choice

between them must be dictated by a principle deeply rooted

in this Court’s Indian jurisprudence: statutes are to be

construed liberally in favor of the Indians, with ambiguous

provisions interpreted to their benefit.” 502 U.S. at 269

(cleaned up).

Congress in fact contemplated that we would apply this

very canon to IGRA when interpreting it. The Senate

Committee Report states that Congress “trusts that courts

will interpret any ambiguities [in IGRA] in a manner that

will be most favorable to tribal interests consistent with the

legal standard used by courts for over 150 years in deciding

cases involving Indian tribes.” S. Rep. No. 100-446, at *15.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 61

We are faced with not only two “possible” constructions

of IGRA, but two equally plausible ones. Applying the

canon, we must choose the interpretation most favorable to

the tribes, which, in this case, is the construction proposed

by Judge Bress. Holding that it is a per se breach of “good

faith” for a state to insist on negotiating a compact provision

not even arguably within the “operation of gaming

activities” protects tribal sovereignty, while ensuring that the

twin purposes of IGRA are fulfilled.

IV.

Contrary to Judge Bumatay’s assertions, this approach

does not conflict with § 2710(d)(7)(B)(iii) by “bar[ring]

courts from even considering the [good faith] factors before

forcing parties into IGRA’s remedial procedures” in all

cases. Courts would still be able to consider the good faith

factors as part of the burden-shifting framework in a number

of instances including, for example, when evaluating

whether a state’s actions constitute procedural bad faith, and

whether a state proposed on-topic terms in good faith. This

approach does not read the burden-shifting good faith

inquiry out of the statute, it simply applies it in a manner

consistent with the limited role of states in regulating Indian

gaming.

BUMATAY, Circuit Judge, dissenting:

This case poses a difficult question of statutory

interpretation. It requires us to parse several provisions of

the Indian Gaming Regulatory Act (“IGRA”) to determine

the meaning of “good faith.” But as with any case, we are

duty-bound to follow the text of the law wherever it leads.

62 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

And because the majority creates an automatic bad-faith rule

not found in IGRA’s text, I respectfully dissent.

IGRA establishes a comprehensive framework

governing gaming on Indian lands. See 25 U.S.C. § 2701, et

seq. Under IGRA, tribal casinos may only run Class III

gaming (Las-Vegas style games such as blackjack) under a

valid Tribal-State gaming compact—an agreement that

authorizes and regulates gaming activity on tribal land

within a State. § 2710(d)(1)(C). 1 IGRA enumerates

permissible gaming-related topics that may be included

within these Tribal-State compacts. § 2710(d)(3)(C). IGRA

also requires States to negotiate in “good faith” when a tribe

requests a compact for Class III gaming. § 2710(d)(3)(A).

While “good faith” is not specifically defined, IGRA

provides multiple factors that courts may consider in

determining whether a State has met its duty. Finally, to

enforce this good-faith duty, IGRA creates a cause of action

for tribes to bring against recalcitrant States,

§ 2710(d)(7)(A)(i), and a mandatory remedial process that is

triggered when a State violates its duty.

§ 2710(d)(7)(B)(iii)–(vii).

The Chicken Ranch Rancheria of Me-Wuk Indians,

along with several other tribes (collectively, the “Tribes”)

sued the State of California and Governor Gavin Newsom

(collectively, “California”) for violating their “good faith”

duty by negotiating for topics outside IGRA’s scope. The

district court agreed with the Tribes and found that

California violated its good-faith duty of negotiation.

Chicken Ranch Rancheria of Me-Wuk Indians v. Newsom,

530 F. Supp. 3d 970, 988 (E.D. Cal. 2021). And while I

1

Unless otherwise indicated, all section (§) citations refer to Title

25 of the U.S. Code.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 63

agree with the majority that California negotiated for topics

outside IGRA’s scope, I disagree with the majority’s

purpose-based analysis of “good faith.” Instead, by looking

to IGRA’s text and structure, I would vacate and remand the

district court’s judgment for a proper analysis of whether

California satisfied its good-faith duty.

I.

IGRA’s text and structure command a nuanced approach

to the good-faith analysis. Under IGRA, a State must

negotiate to enter a Tribal-State compact in “good faith.”

§ 2710(d)(3)(A). And IGRA creates a burden-shifting

framework for analyzing whether a State has negotiated in

good faith. Pauma Band of Luiseno Mission Indians v.

California, 973 F.3d 953, 958 (9th Cir. 2020). A plaintiff

tribe must first “introduc[e] . . . evidence” that a compact

was not entered and that the State either failed to respond or

“did not respond to [the tribe’s] request in good faith.”

§ 2710(d)(7)(B)(ii)(I)–(II). Once that initial showing is

made, the State bears the “burden of proof” in establishing

that it negotiated with the tribe in good faith.

§ 2710(d)(7)(B)(ii). If the State fails to make such a

showing, a court may order the parties into IGRA’s “multi-

step judicial remedy.” Pauma Band, 973 F.3d at 958.

IGRA does not define “good faith,” id. at 957, but it

provides several textual and structural clues on how courts

are to enforce it. Two provisions, in particular, guide that

inquiry:

First, IGRA’s list of permissible topics for Tribal-State

compacts. Section 2710(d)(3)(C) provides that a Tribal-

State compact “may include provisions relating to—”:

64 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

(i) the application of the criminal and civil

laws and regulations of the Indian tribe or the

State that are directly related to, and

necessary for, the licensing and regulation of

such activity;

(ii) the allocation of criminal and civil

jurisdiction between the State and the Indian

tribe necessary for the enforcement of such

laws and regulations;

(iii) the assessment by the State of such

activities in such amounts as are necessary to

defray the costs of regulating such activity;

(iv) taxation by the Indian tribe of such

activity in amounts comparable to amounts

assessed by the State for comparable

activities;

(v) remedies for breach of contract;

(vi) standards for the operation of such

activity and maintenance of the gaming

facility, including licensing; and

(vii) any other subjects that are directly

related to the operation of gaming activities.

Through this provision, “IGRA limits permissible subjects

of negotiation in order to ensure that tribal-state compacts

cover only those topics that are related to gaming.” Rincon

Band of Luiseno Mission Indians v. Schwarzenegger,

602 F.3d 1019, 1028–29 (9th Cir. 2010).

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 65

And the Supreme Court has explained that “gaming

activities” in the § 2710(d)(3)(C) context is narrowly

construed: it “means just what it sounds like—the stuff

involved in playing class III games.” Michigan v. Bay Mills

Indian Cmty., 572 U.S. 782, 792 (2014). It refers only to

“what goes on in a casino—each roll of the dice and spin of

the wheel”—not to “off-site licensing or operation of the

games.” Id.; see also id. (“[G]aming activity is the gambling

in the poker hall, not the proceedings of the off-site

administrative authority.”); id. (An agency’s power to

“‘close a gaming activity’ means “to shut down crooked

blackjack tables, not the tribal regulatory body meant to

oversee them.” (simplified)).

The list of permissible negotiation topics is also

circumscribed by “one key limitation on state negotiating

authority” found in § 2710(d)(4). Rincon, 602 F.3d at 1028.

Under that provision, IGRA generally prevents a State from

“impos[ing] any tax, fee, charge, or other assessment upon

an Indian tribe . . . to engage in a class III activity.”

§ 2710(d)(4).

Second, IGRA tells courts how to analyze good faith. It

establishes that, in determining “whether a State has

negotiated in good faith, the court—”

(I) may take into account the public interest,

public safety, criminality, financial integrity,

and adverse economic impacts on existing

gaming activities, and

(II) shall consider any demand by the State

for direct taxation of the Indian tribe or of any

Indian lands as evidence that the State has not

negotiated in good faith.

66 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

§ 2710(d)(7)(B)(iii).

These provisions work in tandem to determine whether

a State has met its good-faith duty.

To start, § 2710(d)(3)(C) enumerates permissible topics

that may be negotiated as part of a Tribal-State compact. If

a tribe shows that a State violated § 2710(d)(3)(C) by

negotiating for an off-list topic, that serves as “evidence” of

a State’s bad faith under IGRA’s burden-shifting framework.

See § 2710(d)(7)(B)(ii). At that point, the burden shifts to

the State to prove its good faith. Id.

Courts then assess a State’s claim of good faith under

§ 2710(d)(7)(B)(iii). Section 2710(d)(7)(B)(iii) provides

two ways to analyze good faith. First, “a court must consider

a ‘demand’ for a tax to be made in bad faith.” Rincon,

602 F.3d at 1029; see also § 2710(d)(7)(B)(iii)(II). In other

words, such a demand is “evidence of the State’s bad faith.”

Rincon, 602 F.3d at 1030. Second, “the State may attempt

to rebut bad faith” by showing that any off-list topic was

justified by “the public interest, public safety, criminality,

financial integrity, and adverse economic impacts on

existing gaming activities.” Id. at 1032; see also

§ 2710(d)(7)(B)(iii)(I). In other words, the State can use

these statutory factors to establish its good faith despite

negotiating for off-list topics.

I explain IGRA’s meaning in greater detail below.

A.

The first step in the good-faith inquiry is understanding

that § 2710(d)(3)(C) creates an exhaustive list of

permissible, gaming-related topics that a State may bargain

for as part of a compact with a tribe. In other words,

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 67

§ 2710(d)(3)(C) creates a binary of on-list/off-list subjects

with only on-list topics permissible for negotiation. I would

reach this conclusion for three reasons.

One reason is the text. Section 2710(d)(3)(C)’s language

shows that it limits the field of permissible negotiation

topics. It states that a gaming compact “may include” seven

gaming-related topics. § 2710(d)(3)(C)(i)–(vi). While the

word “may” is ordinarily considered permissive, its meaning

is judged based on context. Cf. Black’s Law Dictionary

(11th ed. 2019) (“In dozens of cases, courts have held may

to be synonymous with shall or must[.]”). Based on the

context here, “may” should be interpreted as mandatory or

as meaning “may only.” That’s because the provision

identifies only gaming-relating topics as permissible

subjects. By detailing a list of six specific gaming issues,

along with a catchall provision that permits other topics

“directly related to the operation of gaming activities,”

§ 2710(d)(3)(C)(vii), Congress limited the permissible

gaming compact topics to activities that are gaming related.

Put simply, there would be no need for Congress to include

six specific topics and a limited catchall if States were free

to insert extraneous topics into gaming compacts.

The second reason is our interpretative canons. Two

well-established canons confirm § 2710(d)(3)(C)’s

exhaustive nature. First, the expressio unius canon says that

the identification of related topics within an associated group

generally excludes unrelated topics. See NLRB v. SW Gen.,

Inc., 137 S. Ct. 929, 940 (2017); see also Wheeler v. City of

Santa Clara, 894 F.3d 1046, 1054 (9th Cir. 2018). Second,

the ejusdem generis principle provides that a “general term

following more specific terms means that the things

embraced in the general term are of the same kind as those

denoted by the specific terms.” United States v. Lacy,

68 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

119 F.3d 742, 748 (9th Cir. 1997) (simplified). Both canons

work here to show § 2710(d)(3)(C)’s exclusive nature. For

example, a “sign outside a veterinary clinic saying ‘Open for

treatment of dogs, cats, horses, and all other farm and

domestic animals’ does suggest (by its detail) that the circus

lion with a health problem is out of luck.” Antonin Scalia &

Bryan A. Garner, Reading Law: The Interpretation of Legal

Texts 107–08 (2012). IGRA permits six detailed subjects

and a seventh catchall related to gaming activities—the

negative implication of § 2710(d)(3)(C) is that unrelated

subjects are impermissible.

The third reason—our precedent. In Rincon, we

explained that “[t]he language and structure of

§ 2710(d)(3)(C) suggest[] it is exhaustive.” 602 F.3d at 1028

n.9. We observed that “[a]lthough ‘may’ indicates

permissiveness . . . to grant permission is not necessarily to

grant carte blanche. What is ‘permitted’ is limited.” Id. I

agree with Rincon’s suggestion and would hold that the

§ 2710(d)(3)(C) list is exhaustive.

B.

Given § 2710(d)(3)(C)’s limits, a State’s violation of its

list of permissible topics constitutes evidence of a State’s

lack of good faith. When a State limits its negotiation to on-

list, gaming-related subjects, that is evidence that the State

has operated in good faith. Off-list negotiations, however,

show the opposite and require further scrutiny. There are

several textual and structural reasons why this is true.

First, IGRA’s burden-shifting framework makes clear

that evidence of off-list negotiation impacts the good-faith

analysis. As a reminder, plaintiff tribes have the initial

burden of “introduc[ing] . . . evidence” of a State’s refusal to

negotiate a compact in “good faith.” § 2710(d)(7)(B)(ii).

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 69

Once the tribe meets that evidentiary showing, the “burden

of proof” shifts to the State to prove that it has acted in good

faith. Id. By enumerating an exhaustive list of negotiable

subjects, Congress provided tribes with a way to meet their

initial burden of proof—by showing that a State violated

§ 2710(d)(3)(C). In other words, going beyond the scope of

§ 2710(d)(3)(C) is evidence that a State has violated its

good-faith duty under the burden-shifting framework.

Second, the § 2710(d)(3)(C) list notes that it applies to

“[a]ny Tribal-State compact negotiated under subparagraph

(A).” § 2710(d)(3)(C) (emphasis added). Subparagraph A

of § 2710(d)(3)(A) establishes the good-faith requirement.

Thus, the list is textually connected to a State’s good-faith

duty.

Third, a contrary reading would render § 2710(d)(3)(C)

nearly meaningless. If a violation of § 2710(d)(3)(C) did not

constitute evidence of bad faith, then the provision would

have little significance in IGRA’s overall structure. Instead,

by linking the list to evidence of bad faith, this interpretation

“give[s] effect . . . to every clause and word” of IGRA.

United States v. Menasche, 348 U.S. 528, 538–39 (1955)

(simplified).

So if a tribe has introduced evidence that a State sought

provisions outside the confines of the § 2710(d)(3)(C) list,

then the tribe has satisfied its burden to show the State’s bad

faith and the burden shifts to the State to prove its good faith.

But if a tribe fails to show that a State has put off-list topics

on the negotiation table, then the tribe hasn’t met its initial

70 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

burden and the State may prevail. 2 In effect, Congress gives

a State free rein to haggle for permissible gaming-related

topics—but if the State overreaches by negotiating for topics

outside of § 2710(d)(3)(C), then it is subject to greater

scrutiny.

C.

Greater scrutiny comes in the form of

§ 2710(d)(7)(B)(iii)(I)’s good-faith factors. As we have

said, the “good faith inquiry is nuanced and fact-specific.”

Coyote Valley II, 331 F.3d at 1113. So a State’s negotiation

for an off-list subject doesn’t automatically lead to a finding

of bad faith. Congress instead provided several factors that

courts “may take into account” when determining a State’s

good faith. § 2710(d)(7)(B)(iii)(I). These factors include

the “public interest, public safety, criminality, financial

integrity and adverse economic impacts on existing gaming

activities.” § 2710(d)(7)(B)(iii)(I). Based on these factors,

a State may prove that its off-list negotiations still amounted

to good faith.

While the five good-faith factors may appear

freewheeling, they aren’t to be construed “broadly in favor

of the State’s interests.” Rincon, 602 F.3d at 1032. Instead,

“those terms clearly apply to protecting the State against the

adverse consequences of gaming activities.” Id. So the

good-faith factors are to be read considering “legitimate state

interests regarding gaming and the purposes of IGRA.” Id.

at 1039. The factors must also be read in line with IGRA’s

2

While on-list negotiation is evidence of good faith as a substantive

matter, it doesn’t protect the State from charges of procedural bad faith.

See In re Indian Gaming Related Cases, 331 F.3d 1094, 1109 (9th Cir.

2003) (“Coyote Valley II”) (analyzing good faith as both a procedural

and substantive matter).

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 71

statutory command to “promot[e] tribal economic

development, self-sufficiency, and strong tribal

governments” and “ensure that the Indian tribe is the primary

beneficiary of the gaming operation.” § 2702(1), (2).

In short, IGRA’s good-faith analysis works like this:

(1) If a tribe fails to show that a State

negotiated for topics outside of

§ 2710(d)(3)(C), absent more, it has

failed to meet its initial showing of bad

faith and the inquiry ends.

(2) But if a tribe shows that a State negotiated

on a topic outside the list, it has satisfied

its initial burden of proving bad faith; and

(3) The burden then shifts to the State to

show its good faith under the

§ 2710(d)(7)(B)(iii)(I) factors.

While not the most straightforward statute, this reading

interprets IGRA “as a symmetrical and coherent regulatory

scheme . . . and fit[s] . . . all [its] parts into an harmonious

whole.” FDA v. Brown & Williamson Tobacco Corp.,

529 U.S. 120, 133 (2000) (simplified).

D.

With the proper legal framework in mind, I would hold

that California negotiated on four topics outside the scope of

the § 2710(d)(3)(C) list—spousal and child support orders,

environmental mitigation requirements, local government

agreements, and state tort law remedies. The Tribes thus met

their burden to show that California exceeded the scope of

IGRA’s permissible-topics list. And I would hold that the

72 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

burden shifted to California to prove that it complied with its

good-faith duty under the factors provided in

§ 2710(d)(7)(B)(iii)(I). I would therefore vacate the district

court’s grant of summary judgment for the Tribes and

remand so the district court may conduct the good-faith

analysis under the statutory factors in the first instance.

II.

My main disagreement with the majority results from

violating § 2710(d)(3)(C)—IGRA’s list of permissible

topics. The majority asserts that when a State negotiates for

a topic “well outside” IGRA’s list of permitted topics, it

constitutes per se bad faith—automatically triggering

IGRA’s remedial procedures. See Maj. Op. 31

(“Accordingly, when a state has demanded that a tribe

negotiate on topics well outside IGRA’s scope, it follows

that the state has not negotiated in good faith, end of story.”).

But there are several problems with the majority’s

interpretation.

A.

First, the majority relies heavily on its sense of IGRA’s

core “principles” and “objectives.” Maj. Op. 31. Instead of

relying on text and structure, the majority tells us “what

Congress had in mind” when it enacted IGRA, Maj. Op. 27–

28, and construes the statute from there. For example, we

are told to intuit Congress’s “aware[ness] of the danger that

states could use their compacting approval powers to

encroach on tribal sovereignty,” Maj. Op. 12, and to read the

provisions at issue here based on “core aspects of tribal

sovereignty,” Maj. Op. 27. This is not a text-based

approach; it’s a purpose-driven one. And what the majority

hints at, the concurrence makes clear. The concurrence says

that we should not be confined by “the text of the statute and

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 73

our precedents construing IGRA,” but instead we should

glean meaning from IGRA’s “purpose,” “legislative

history,” and atextual canons of construction. Concurrence

at 49–50.

But of course, the analysis must start and end with

IGRA’s text and structure—regardless of whether we

believe it best achieves the statute’s purpose. As judges, we

must reject “surmise about legislative purpose” and instead

look to a statute’s text and structure for guidance.

HollyFrontier Cheyenne Ref., LLC v. Renewable Fuels

Assn., 141 S. Ct. 2172, 2181–83 (2021). The majority tries

to cloak its reliance on IGRA’s purposes by calling it the

“context of the statute as a whole.” Maj. Op. 43. But it is

one thing to look to context to interpret the words of a

statute; it is another to use context to divine some broad

legislative purpose to override the statute’s plain meaning.

See John F. Manning, What Divides Textualists from

Purposivists?, 106 Colum. L. Rev. 70, 92–93 (2006)

(explaining the difference between “contextual evidence of

semantic usage” and “contextual evidence of the policy

considerations that apparently justified the statute”).

Contrary to the view of my colleagues, “we can never let

perceived legislative purpose eclipse the ordinary meaning

of statutory text.” Rojas v. FAA, 989 F.3d 666, 695 (9th Cir.

2021) (en banc) (Bumatay, J., dissenting in part). Indeed,

“[l]awmaking is not a tidy affair;” “[i]t can be a clumsy,

inefficient, even unworkable process.” Id. (simplified). So,

in my view, it is a fruitless exercise to try to divine why

Congress chose to write IGRA the way it did. For example,

the majority wonders why Congress inserted the good-faith

factors into IGRA when doing so could “undermine” the

statute’s “crystalline” objective. Maj. Op. 41. But such

arguments have little to do with uncovering meaning and

74 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

ignore what are often “hard-fought compromises” in

legislation. Bd. of Governors of Fed. Reserve Sys. v.

Dimension Fin. Corp., 474 U.S. 361, 374 (1986). The

Supreme Court has warned us that “[c]ourts are not

authorized to rewrite a statute because they might deem its

effects susceptible of improvement.” Badaracco v. Comm’r,

464 U.S. 386, 398 (1984). Rather than question the

“wisdom” of Congress, see Maj. Op. 42–43, we must

enforce the statute Congress wrote—not offer judicial

amendments for the sake of sound policy. 3

B.

Most fundamentally, the majority’s reading of IGRA

conflicts with its plain text. The majority concludes that a

State’s negotiation for topics “well outside” § 2710(d)(3)(C)

automatically constitutes bad faith. See Maj. Op. 48. But

that bears little resemblance to the law Congress enacted.

IGRA establishes that courts “may take into account” the

good-faith factors—public interest, public safety,

criminality, financial integrity and adverse economic

impacts—before “determining . . . whether a State has

negotiated in good faith.” § 2710(d)(7)(B)(iii)(I). The

majority’s approach effectively erases these factors from the

statute.

3

The majority also ventures away from IGRA’s text and structure,

and even beyond its legislative history, to hypothesize about what the

Department of Interior might say about this compact. Maj. Op. 42–43

(rejecting an interpretation of IGRA that would allow “further

proceedings on a compact that the Department of Interior has

telegraphed it will reject”). IGRA’s text governs irrespective of Interior

officials’ future judgment calls. In interpreting IGRA, we have a duty to

interpret the law no matter how unelected bureaucrats might react.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 75

Instead, the majority’s automatic bad-faith rule bars

courts from even considering the factors before forcing

parties into IGRA’s remedial procedures. So while the

majority sees a violation of § 2710(d)(3)(C) as the “end of

[the] story,” see Maj. Op. 31, IGRA tells us that courts may

continue to analyze good faith based on the statutory good-

faith factors. Essentially, the majority substitutes “may not”

where the statute clearly says “may”—something we are not

authorized to do.

Such a reading is also inconsistent with IGRA’s

structure. IGRA authorizes States to impose assessments on

a tribe’s gaming activities, but precludes them from

imposing any tax or assessment “upon an Indian tribe” itself.

§ 2710(d)(3)(C), 2710(d)(4). In the same subsection as the

good-faith factors, IGRA establishes that courts “shall

consider any demand by the State for direct taxation of the

Indian tribe . . . as evidence that that the State has not

negotiated in good faith.” § 2710(d)(7)(B)(iii)(II) (emphasis

added). So even when a State unquestionably violates

IGRA’s list of permissible topics, such negotiation still

doesn’t trigger automatic bad faith because IGRA tells

courts to consider such a demand “as evidence” of bad faith.

Id. If any off-list negotiation constituted automatic bad faith

(as the majority contends), there would be no point in

making “direct taxation of the Indian tribe” evidence of bad

faith since that topic is already outside the list of permissible

subjects. 4 The majority thus neglects IGRA’s nuanced

4

The majority tries to evade this dilemma by saying that “[a]

negotiated provision may be characterized as a direct tax and also fall

within a permissible topic of negotiation” because IGRA authorizes

“assessments.” Maj. Op. 40 n.8. That’s not so. IGRA authorizes

“assessments” and “taxation” of gaming activities—not a direct tax on

76 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

scheme for analyzing good faith by fashioning a per se rule

divorced from the text.

At the same time, the majority also creates a new atextual

test for complying with § 2710(d)(3)(C). Now,

§ 2710(d)(3)(C) is seemingly violated only when a State’s

proposed topic is “well outside” or “far exceeds” the list of

permissible topics. Maj. Op. 30–31 Where does this test

come from? And how exactly are district courts supposed to

administer it? The majority doesn’t say.

Now judges will be tasked with resolving a multi-step

test whenever they confront an IGRA challenge. First,

courts will have to draw a line between on-list and off-list

topics. Second, courts will need to define when an off-list

topic is “well outside” the list. How will they know when a

topic “far exceeds” or is just “slightly” outside the list? See

Maj. Op. 31 n.5. Presumably, courts will have to make it up.

And what happens when a topic is slightly outside the list?

Does the State get a pass? If so, that conflicts with the

majority’s view that the “exhaustive nature of IGRA’s

enumerated list . . . means nothing if states can ultimately go

beyond that list.” Maj. Op. 31. In my view, these tough

questions are all unnecessary given that the words “far

exceed” or “well outside” appear nowhere in IGRA’s text.

Perhaps this confusing framework is because the

majority is unwilling to live with the consequences of its

automatic bad-faith rule—that any deviation from the list is

per se bad faith and triggers IGRA’s remedial procedures.

Take this case as an example. The negotiations between

tribes unrelated to gaming activity. § 2710(d)(3)(C)(iii)–(iv). So it

remains true that a direct tax of an Indian tribe is an off-list topic and

Congress did not require an automatic finding of bad faith.

CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA 77

California and the Tribes took place over four years, with

39 days of in-person negotiations, and 26 draft compacts

exchanged between the parties. Under the majority’s

framework, if California proposes any topic or proposal

minimally outside the list, the Tribe could go to court,

petition for the remedial procedures, and wipe out all those

hard days of negotiation. Seemingly too much to stomach,

the majority gives itself breathing room by fashioning the

“well outside” requirement out of whole cloth. So now,

instead of relying on the statutory factors of good faith,

parties will now have to litigate the inches between what’s

“permissible” and what’s “well outside” the line.

C.

The majority tries to preserve some use for the good-

faith factors by suggesting that they can be used to evaluate

a State’s on-list negotiations. Maj. Op. 37. But such a

reading makes complying with § 2710(d)(3)(C) nearly

meaningless. Even when a State follows § 2710(d)(3)(C)’s

list of permissible topics to a tee, the majority would still

require the State to defend its negotiations under the good-

faith factors. This approach dramatically expands IGRA’s

scope, abandons the statute’s burden-shifting framework,

and makes litigation more likely.

While the majority agrees that § 2710(d)(3)(C)

constitutes a list of permissible negotiation topics, those

topics may not be so permissible after the majority’s good-

faith analysis. In other words, if a State does exactly what

IGRA tells it to do by negotiating for on-list topics, the

majority would still have courts review every detail of the

negotiations to sniff out evidence of bad faith. But IGRA’s

text does not give courts a license to put every negotiation

detail under the microscope—especially when a State

negotiates for exactly what IGRA allows.

78 CHICKEN RANCH RANCHERIA V. STATE OF CALIFORNIA

As a supposed justification for its approach, the majority

imagines a scenario where a State bargains for a permissible,

on-list topic, but the proposal would be “highly

burdensome” and “unnecessary.” Maj. Op. 34. I agree that

negotiating for “unnecessary” topics may constitute bad

faith in some cases, but we need not adopt the majority’s

atextual framework to get there. Under a proper reading of

IGRA, a tribe may still allege that a State engaged in

procedural bad faith by disguising an unnecessary poison pill

as a substantively permissible topic. Cf. Pauma Band,

973 F.3d at 963, 966 (analyzing a claim of procedural bad

faith for including “unduly harsh” language in the draft

compact).

III.

In the end, my disagreement with the majority comes

down to principles of statutory interpretation. Rather than

interpreting text and structure, the majority instead focuses

on reading IGRA based on its “core principles,” Maj. Op. 31

“core objectives,” id. at 31; “legislative intent,” id. at 43;

“legislative history,” Concurrence at 49–50; and “purpose,”

id. at 59. The unfortunate result is the expansion of IGRA

beyond what its text allows.

For these reasons, I respectfully dissent.