Petition — Ashcroft v. United States Department of the Interior

Office-Supreme Court, U.S.

FILLED

OCT 12 1962

NO. 8 2 aa 7 2 0 _| ALEXANDER L STEVAS,

CLERK

In the

SUPREME COURT

of the

UNITED STATES

OCTOBER TERM, 1982

NORMAN ASHCROFT, et. al.,

Petitioners

v8.

THE UNITED STATES DEPARTMENT OF INTERIOR,

et al.,

Respondents

vs

THE UNITED STATES OF AMERICAN, et. al.,

Respondents

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE NINTH COURT

WILLIAM J. DARLING

Counsel of Record

EAVES AND DARLING, P.A.

1516 San Pedro NE

Albuquerque, New Mexico

87110

(505) 262-2661

Counse! for Petitioners

IN THE SUPREME COURT OF THE UNITED STATES

OCTOBER TERM, 1982

NORMAN ASHCROFT, et al.,

Petitioners,

vs. No.

THE UNITED STATES DEPARTMENT

OF THE INTERIOR, et al.

PETITION FOR A WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF THE APPEALS

FOR THE NINTH CIRCUIT

QUESTIONS PRESENTED FOR REVIEW

1. Whether a business which is

operating on an enclave of fee patent land

which existed before the creation of the

reservation or was withdrawn from the reser-

vation, which was later surrounded by the

Navajo reservation and which does only an

insignificant amount of business with reser-

vation Indians, is subject to licensing and

regulaticn under the Indian Traders Statutes,

25 U.S.C., 88 261-264, and the Regulations

promulgated pursuant to those statutes?

2. Whether fee patent land which is now

surrounded by the Navajo reservation, but

which was patented either before the creation

of the reservation or was withdrawn from the

reservation at a later date, constitutes

"Indian country” within the meaning of the

Indian Traders Statutes, 25 U.S.C., 88

261-264?

PARTIES

NORMAN ASHCROFT d/b/a Querino Canyon

Superette; CLYDE A. BAKER, d/b/a Baker

Chevron; EVERETT EDMUNDS & ‘iAYNE HARRIS,

d/b/a Ganado Chevron; RICHARD HARRIS, d/b/a

Two Story Trading Post; MRS. LESTER (ANNA)

LEE: JIM McAVOY, d/b/a St. Michaels Towing;

DWIGHT McGEE, d/b/a Aneth Trading Post;

ARMOND ORTEGA, d/b/a Indian Ruins; FREDDY

SLATTON, d/b/a Tomahawk Indian Store; BRADY

SMITHSON, d/b/a Burnt Water Trading Post;

HOMER THOMPSON, d/b/a Tuller Cafe; and ARTHUR

KEENAN,

Plaintiffs/Appellees,

v.

THE UNITED STATES DEPARTMENT OF THE INTERIOR,

THE HONORABLE CECIL D. ANDRUS, Secretary of

the Department of Interior; and THE BUREAU OF

INDIAN AFFAIRS, an agency of the United

States of America and a Division of the

Department of Interior,

Defendants/Appellants.

ii

ATKINSON'S LTD. OF ARIZONA, an Arizona cor-

poration, d/b/a Gilbert Ortega's Cameron

Trading Post,l

Plaintiffs/Appellees,

Vv.

THE UNITED STATES OF AMERICA AND THE

HONORABLE CECIL D. ANDRUS, Secretary of the

Interior,

Defendants/Appellants.

1 Also doing bysiness as and known as:

Atkinson's Tradi'g Company, Inc.; Joe

Atkinson, a/k/a Edwin J. Atkinson; Atkinson's

Trading Company of Arizona, Inc.; Atkinson's

Ltd. of New Mexico; Atkinson's Ltd. of

Arizona.

iii

TABLE OF CONTENTS

Pages

Questions Presented For Review ...... i

Parties eeeeeeeeeeeneeneeeeeeeneeeeeneenee ii

Table of Authorities eeceneeeeeeeeeeene vi

INCCOGUCtION ..cececceeececcceseseecs 1

Opinions Below ....ccccccccccccccesces 1

JULISGICCION .n.cccccccccccvccscceccce 2

Statutes, Regulations and Treaties

TNVO]LVEd ccccccccccccccccccesccsece 2

Statement of the Case ...eecssesceees 3

Reasons For Granting Certiorari ..... 8

I. The Decision Below Conflicts

With The Decision of This

Ccurt In Montana v. The

United States eeneeeneeneeeeee#eee 8

II. The Circuit Court Decided

An Important Question Per-

taining To The Indian

Traders Statutes, 25 U.S.C,

$8 261-264, Which Has Not

Been, But Should Be, Settled

By This COUrt ..ccccccsccsees 25

Conclusion eeeseeeeeeeeeeeeeeeeeeeeeee 32

Appendix A: Ninth Circuit Decision . 33

Appendix R: District Court Opinion . 43

Appendix C: Copy of the Judgment ... 58

iv

Appendix

Appendix

Appendix

Appendix

Appendix

Appendix

Appendix

Appendix

D:

G:

I:

J:

Order Denying Re-

hearing eeeneeeeeneeeeee

25 U.S.C. oe 261-264 eee

25 C.F.R. Part 251 and

25 C.F.R. Part 252 ...

Act

1

Act

2

Act

3

Act

4

of July 22, 1790,

Stat. 137 eeeeeeeeee

of March 30, 1802,

Stat. 139 eeeeeeeeee

of May 6, 1822,

Stat. 683 eeeneeseeeeee

of June 30, 1834,

Stat. 729 e*eeseeeeeneeee

Treaty with the Navajo,

15 Stat. 667 (1868) ..

Certificate of Service ..cccccccveces

Entry of Appearance eeeeeoeaeeeeeeeeeee

60

62

63

82

84

93

95

102

108

110

Phedaiaps 95 U.S. (5 Otto)

E rte Crow , 109 U.S. 556,

strict Court, 400

Montana ‘3 The ghee sruai 450

ewe , . . 1981) .

Rider v. ir, 138 P. 3

v. Kneip, 430

Seymuur 3 ook satendent, 368

U. > eeneeeeeneeeneeeneeee

Taylor z: United gigtes, 44 F.2d

Ir. eeneeeeeeeeee

oux Tri

vi

17

19

16

21

22

8,9,11

12,20,21,

22,23,24,

25

15

19

20

15

17

14

4 Stat. 729. Act of June 30,

1834 eeeneeeeeeeeeeeeeeeeneeeeeeeee 16,17

48 Stat. 960-62. Act of June 14,

1934 CCPC! 18

18 U.S.C. ° 1151 eeeeeeeeeeeeeeeee 16,19,20

25 U.S.C. ae 261-264 (Indian

Traders Statutes) eeeeeeeeeeeeee 11,14,15,

19,21,22,

25,26,27,

28,29,30,

31

25 U.S.C. 2 261 eeeeeeeeneeeeeeeeee 25

25 U.S.C. 2 262 eeeeeeeeeeeeeeeeee 25

25 U.S.C. s 263 eeeeeeeeeeeeeeeeee 25

25 U.S.C. 7 264 e*eneeeeeeeeeeeneeeee 16,39,26

TREATIES

‘15 Stat. 667. Treaty Between The

United States Government and

the Navajo Nation of 1868 ...... 18

M S CITA Ss

25 C.F.R. 2 251.11 eenenereeeeeneeeeee 42,23 9%0

25 C.F.R. 2 251.3 eeeeeveeeeaeeeeeene 27

vii

ALNTRODUCTION

The Petitioners, Norman Ashcroft, doing

business as Querino Canyon Superette; Armond

Ortega, doing business as Indian Ruins; and

Atkinson's Ltd. of Arizona, an Arizona

Corporation, doing business as Gilbert

Ortega's Cameron Trading Post, pray that a

Writ of Certiorari issue to review the opi-

nion and judgment of the United States Court

of Appeals for the Ninth Circuit rendered in

these proceedings on June 9, 1982, and

modified on September 2, 1982 (rehearing

denied).

OPINIONS BELOW

The opinion of the United States Court of

Appeals for the Ninth Circuit, Norman

Ashcroft, et al., v. The United States

Department of the Interior, et al., ____ F.2d

_.. (9th Cir. 1979) appears at Appendix A,

pages 33 through 43. The opinion of the

United States District Court for the District

of Arizona, r t Vv

e n rior, e

al., 513 F.Supp. 595 (D. Ariz. 1981), appears

at Appendix B, infra, pages 43 through 58.

JURISDICTION

The Judgment of the Court of Appeals for

the Ninth Circuit was entered on June 9,

1982. A timely Petition for Re-hearing was

denied on September 2, 1982, and a timely

Motion to Stay Issuance of the Mandate

pending this application for certiorari was

filed on September 8, 1982. This Court's

jurisdiction is invoked under Supreme Court

Rule 19 and 25 U.S.C. 88 261-64.

PB TIONS TIES I VED

The following statutes, regulations and

treaties, because of their length, are repro-

duced as appendices:

j}. 25 U.S.C. 88 261-264 (Appendix E).

2. 25 C.F.R. Part 251 and 25 C.F.R.

Part 252 (Appendix F).

3. Act of July 22, 1790, 1 Stat. 137

(Appendix G).

4. Act of March 30, 1802, 2 Stat. 139

(Appendix 8).

5. Act of May 6, 1822, 3 Stat. 683

(Appendix <).

6. Act of June 30, 1834, 4 Stat. 729

(Appendix J).

7. Treaty with the Navajo, 15 Stat. 667

(1868) (Appendix K).

STATEMENT OF THE CASE

The facts relevant to the questions pre-

sented by this Petition are uncontroverted

and therefore may be introduced to the Court

in a summary fashion.

Most of the Petitioners’ businesses,

including Atkinson's Ltd. of Arizona

(hereinafter “Atkinson's") are located on

primary highways passing through the reser-

vation. (Stip. Facts No. 6 and 7.)

Atkinson's business is operated for and does

almost all of its business with visitors to

the Grand Canyon area and other travelers,

who are traveling interstate, or who are

-3-

using the facilities of Interstate Commerce.

The minimum number of sales that are made to

Indians from the surrounding reservation

lands are an insignificant part of Atkinson's

business. (Stip. Fact No. 6.) The

remaining Petitioners do a substantial part

of their business with non-Indians (Stip.

Fact No. 7.)

Prior to the filing of this action, the

Petitioners had been notified by the Bureau

of Indian Affairs (hereinafter "BIA") that

they must comply with the procedures set

forth in 25 C.F.R. Part 252. The stated pur-

pose of 25 C.F.R. Part 252 is to “prescribe

rules for the regulation of reservation busi-

nesses for the protection of Indian consumers

on the Navajo, Hopi and Zuni reservations" as

required by the Indian Traders Statutes, 25

U.S.C. 88 261-264.

A business owned by one of the Peti-

tioners had already been closed by the BIA,

and the Petitioners, except Atkinson's,

alleged that the BIA had threatened to close

the other businesses of the Petitioners. On

March 3, 1978, the District Court issued a

Temporary Restraining Order prohibiting the

enforcement of 25 C.F.R. Part 252 as it

applied to the other Petitioners. The par-

ties stipulated that the Restraining Order

would remain in effect until the Court ruled

on the merits of the case. On May 17, 1978,

Atkinson's filed an action similar to one

commenced on February 23, 1978 by the other

Petitioners herein who are non-Indian owners

or operators of businesses situated on fee

patent land surrounded by the Navajo reser-

vation, against officials of the Department

of the Interior seeking a temporary

restraining order in the District Court to

halt the enforcement of 25 C.F.R. Parts 251

and 252 against its business.

The District Court consolidated the

action filed by Atkinson's with the action

filed by the other Petitioners on June 27,

1978. Cross motions for summary judgment

based on a set of Stipulated Facts were filed

by the various parties in February, 1980.

The District Court ordered that the motions

for summary judgment be submitted on the

pleadings and the Stipulated Facts, and on

March 17, 1981, the Court issued a permanent

injunction against the enforcement of 25

C.F.R. Part 252 against the Petitioners. The

District Court held that the Petitioners’

businesses were not “reservation businesses"

within 25 C.F.R., 8 252.3(1) and that busi-

nesses on enclaves of fee patent land within

the exterior boundaries of the reservations

were not on the reservation. The District

Court found that the proper scope of the

regulations promulgated under the Indian

Traders Statutes was limited to businesses

which were on lands subject to sovereign

rights of the tribe, and that these rights

extend only to tribal or trust lands, but not

to fee patent property which is not on the

reservation.

The United States Department of the

Interior and the BIA appealed the decision of

the District Court, and the United States

Court of Appeals for the Ninth Circuit

reversed. The Circuit Court held that busi-

nesses conducted on non-Indian fee land

within the exterior boundaries of the Navajo

reservation are subject to the regulations at

25 C.F.R. Parts 251 and 252 enacted pursuant

to the Indian Traders Statutes. The Circuit

Court held that fee lana within reservation

boundaries is in fact “on the reservation"

and that Indian tribes retain inherent

sovereign power in accordance with the

authority recognized in the Indian Traders

Statute Regulations even though that

authority be asserted over fee patent land

which was patented while outside of the

exterior boundaries of the reservation, but

which was subsequently made an enclave within

the boundaries of the reservation. In so

finding, the Circuit Court relied on language

contained in this Court's decision in

Montana v. United States, 450 U.S. 544, 565

(1981). The Circuit Court concluded that the

Petitioners’ businesses are subject to

licensing and regulation under the Indian

Traders Statutes because the businesses are

subject to the sovereign power of the Navajo

Nation and that this power includes the power

to regulate commerce amonc non-Indians on

enclaves of fee patent land along a major

highway which passes through the Indian

reservation.

REASONS FOR GRANTING CERTIORARI

POINT I

THE DECISION BELOW CONFLICTS WITH THE

DECISION OF THIS COURT IN MONTANA V.

THE UNITED STATES.

In Montana v. The United States, 450 U.S.

544, 101 S.Ct. 1245 (1981), this Court held

that an Indian tribe may not regulate the

activities of non-members except in very spe-

cific circumstances. Those circumstances

are: (1) where there is a specific

Congressional delegation of authority; (2)

where non-Indians enter consensual rela-

tionships on the reservation with the tribe

or its members, through commercial dealing,

contracts, leases, or other arrangements; or

(3) where the conduct of non-Irdians occurs on

the reservation and threazens or has some

direct effect on the political integrity, the

economic security, or the health or welfare

of the tribe. Id. at 565-66. The latter

two circumstances apply only if the conduct

to be regulated occurs “on the reservation."

Id.

It was uncontroverted below that no

express grant of Congress delegates authority

to the Navajo Nation to regulate any business

which is not on their reservation. The

Circuit Court cited the latter two cir-

cumstances as support for its ruling that “a

tribe retains some elements of sovereignty

over all land within reservation boundaries,

absent the exclusive jurisdiction of another

tribe or that of the federal government (such

as the establishment of a military base)."

___. Fe2d _ ss tt Cs Appendix A. pp.

37-38. Accordingly, the Circuit Court deter-

mined that businesses operated by non-Indians

on fee patent land, whose transactions are

almost exclusively with non-Indian travelers

to the Grand Canyon area, are subject to the

sovereign power and civil authority of the

Navajo Nation even though the patented land

had existed before the creation of the reser-

vation or had been withdrawn from it.

The Circuit Court assumed, almost without

discussion, that the businesses of Atkinson's

and the other Petitioners were located on the

reservation because they were surrounded by

the reservation. In making this assumption,

the Circuit Court acknowledged chat there can

be jurisdictional enclaves in the case of

other tribes or the federal government but

impliedly denied that such enclaves could

exist with respect to privately owned land.

-10-

(It should be noted here that the Hopi reser-

vation is entirely surrounded by the Navajo

reservation.) By this reasoning, the Circuit

Court rendered the three limiting circum-

stances of the Montana decision meaningless

because it effectively overlooked an analysis

of whether the Petitioners’ businesses are

"on the reservation.” Consequently, the

Circuit Court concluded that the BIA and the

United States Department of the Interior have

authority to require the Petitioners to con-

form with regulations promulgated under the

Indian Traders Statutes.

The central issue, therefore, is whether

Atkinson's and che other Petitioners have

their businesses located "on the reservation"

or whether their land is a jurisdictional

enclave which is surrounded by the reser-

vation but not on it.

The distinction implicit in the Montana

case that clarifies this issue is whether or

not the fee land in question is Indian

-ll-

country. Only land which is Indian country,

regardless of ownership, may be deemed “on

the reservation." The Circuit Court

overlooked this distinction as it relates to

the jurisdictional limits which the Indian

Trader Statutes impose on the BIA.

The Montana case involved a suit by the

United States in its own right and as fidu-

ciary on behalf of the Crow Tribe to quiet

title to the bed and banks of the Big Horn

River. The United States District Court for

the District of Montana declared that the

State of Montana owned the bed and banks of

the river. The Court of Appeals for the

Ninth Circuit reversed. On Writ of

Certiorari, this Court held that, inter alia,

the Crow Tribe had no power to regulate

ryn-Indian fishing and hunting on reservation

land owned in fee by nonmembers of the Tribe.

In Montana, the fee land in question had

been specifically designated as part of the

reservation. Congress had then authorized

-12-

the issuance of patents in fee to individual

Indians with the ability to alienate the land

to non-Indians after holding it for twenty-

five (25) years. This land clearly did not

exist as fee land before the creation of the

reservation and there is nothing to indicate

that it was later withdrawn from the reser-

vation. This land was still Indian country

and was still part of the reservation even

though it had passed to non-Indian ownership.

As such it was subject to certain, limited

aspects of trible jurisdiction.

With respect to the lands in the present

case, however, the United States stipulated

that they “either existed before the creation

of the reserveration or were withdrawn from

the reservation after its creation". (Stip.

Fact No. 5.) This means that they are not

Indian country and are not part of the reser-

vation, as will be explained below.

Despite the obvious question of how a

parcel of land can continue to be on the

-13-

oo

* ©

reservation if it has been withdrawn from the

reservation, the Circuit Court ignored this

distinction and explained it away in a foot-

note.

"There is no indication in the

record that the tracts in

question differ in any way from

other non-Indian fee land within

a reservation." App. A, p. 7, n. l.

In making this statement, the Circuit

Court ignored the entire line of cases deve-

loped around the concept of “Indian country".

Instead, it relies on the BIA's own interpre-

tation of its regulations which designate

those businesses that it has the jurisdiction

to regulate and ignores the impossibility or

a regulatory agency expanding its jurisdic-

tion beyond that which it is granted by its

authorizing statute.

The courts, in interpreting the Indian

Traders Statutes, have consistently main-

tained a distinction between the act of

trading with Indians and the act of trading

with Indians on an Indian reservation. See,

Warren Post v. Ari

State Tax Commission, 380 U.S. 685 (1965);

Taylor v. United States, 44 F.2d 531 (9th

Cir. 1930); and Rider v. LaClair, 138 P. 3

(Wash. 1914). In Rider v. LaClair, the

Washington Supreme Court states:

-++-fOJne engaged in business of

merchandising at the Two of Wapato,

and who bought and sold therein,

was not a trader r iring a license

to trade in the Indian country.

Wapato is located within the boun-

daries of the Yakima Indian Reser-

vation, upon land to which Indian

title has been extinguished. The

extinction of Indian title seems to

be the test for determining the

characcer of land within or adjacent

to an Indian reservation ....

A trader or seller of merchandise

upon eliminated land is not a

trader within the Indian country,

requiring a license funder the

predecessor of the present Indian

Trader Statutes]. 138 P. at 5-6.

According to the line of cases developing

around this distinction, tribal sovereignty

and jurisdiction continue to exist over land

that is still Indian country or that is on

the reservation, but does not extend to land

that is not Indian country or that has never

been part of the reservation or has been

excluded from the reservation.

Those cases, whether they are based on

the definition contained in the predecessor

of the current 25 U.S.C. § 264 or the defini-

tion contained in 18 U.S.C. § 1151, have uni-

formly held that fee land owned by non-

Indians which existed before the reservation

was created or which was later withdrawn from

the reservation is not Indian country.

Although the present § 264 does not define

"Indian country", its predecessor, Act June

30, 1834, 162, Section 1 did contain a defi-

nition of the term. That definition can be

used to determine the present meaning of the

term “Indian country" because “it is an

admitted rule in the interpretation of statu-

tes that clauses which have been repealed may

still be considered in construing the provi-

sions that remain in force ...." Ex Parte

Crow Dog, 109 U.S. 556, 561 (1883). Under

the Act of 1834, all that part of the United

States west of the Mississippi and not within

the states of Missouri and Louisiana or the

territory of Arkansas was deemed “Indian

country” until and unless the Indian title

had been extinguished in which event the

territory was no longer Indian country. See,

United States v. Forty Three Gallons of

Whiskey, 93 U.S. (3 Otto) 188 (1876).

According to the decision of this Court

{United States Supreme Court) in Bates v.

Clark, 95 U.S. (5 Otto) 204 (1877), the land

described in the Act of 1834:

Was Indian country whenever Indian

title had not been extinguished and

it continues to be Indian country so

long as Irdians had title to it, and

no longer. As soon as they parted

with the title, it ceased to be Indian

country, without any further act of

Congress, unless by the treaty by

which the Indians parted with their

title, or by some act of Congress,

a different rule was made applicable

to the case. Id. at 208.

Under the definition of Indian country

established in these cases, Atkinson's pre-

mises and those of the other Petitioners are

not located in Indian country because Indian

-l17-

title to this land was extinguished by the

treaty between the United States Government

and the Navajo Nation of 1868 (15 Stat. 667),

which defined the extent of the Navajo reser-

vation to be much smaller than it is today.

The portion of the Navajo reservation which

surrounds Atkinson's premises was added to

the reservation in 1934 by the Act of June

14, 1934, Ch. 521, 48 Stat. 960-62, which

redefined the extent of the Navajo Indian

Reservation in Arizona and provided that “all

valid rights and claims initiated under the

public land laws prior to approval hereof

involving any lands within the area so

defined shall not be affected by this Act".

Accordingly, Indian title to the land which

Atkinson's occupies was extinguished by the

treaty of 1868 and was not restored by the

Act of 1934. The land owned by the other

Petitioners has a similar history. The pre-

mises upon which Atkinson's and the other

Petitioners do business, therefore, do not

constitute Indian country as that term is

used in 25 U.S.C. 8 264.

Even if the definition of Indian country

in 18 U.S.C. § 1151 should appl; to the

Indian Trader Statutes (despite it being

limited by its own terms to the Federal

Criminal Code), the BIA would still be unable

to assert jurisdiction over Atkinson's and

the other Petitioners. The cases construing

the definition found in the Federal Criminal

Code have clearly stated that a particular

piece of land is not within Indian country if

it was not under Indian ownership at the time

that the land surrounding it became reser-

vation land, or, if it was later withdrawn

from the reservation by congressional act,

regardless of whether that land may be

surrounded by reservation land. See,

DeCouteau v. District County Court for Tenth

Judicial District, 420 U.S. 425 (1975);

Rosebud Sioux Tribe v. Kneip, 430 U.S. 584

(1977). This result obtains even though one

of the purposes of the broad definition of

Indian country contained in 18 U.S.C. § 1151

was to avoid checkerboard jurisdiction. See,

Seymour v. Superintendent, 368 U.S. 351 (1962).

According to the stipulated facts, the

premises upon which Petitioners’ businesses

are located were excluded from the reser-

vation or existed before the reservation and

are therefore not Indian country. On the

other hand, land, such as that in Montana,

which became non-Indian owned fee land after

the creation of the reservation and which was

never withdrawn from the reservation con-

tinues to be Indian country and certain

aspects of tribal jurisdiction continue, sub-

ject to the limitations set forth by this

Court in Montana.

Once it is determined that the

Petitioners’ land is not Indian country, the

error of the Circuit Court's decision is made

clear. The Circuit Court agrees with the

District Court that the proper scope of the

-20-

regulations is limited to businesses which

are on land subject to the sovereign rights

of the tribe but disagrees with the District

Court that these sovereign rights extend only

to tribal or trust lands. _— F.2d ate,

n.2; Appendix A, p. 41, n.2. The Circuit

Court utterly fails to decide the crucial

question whether Petitioners’ lands are

Indian country. Absent such a determination,

it is impossible to conclude that Peti-

tioners' businesses are "on the reservation"

and subject to regulations promulgated under

the Indian Traders Statutes. Following the

rule in Montana, the proper scope of Indian

Trader regulations is limited to businesses

which operate on lands subject to inherent

tribal sovereignty, i.e., land which remains

Indian country.

Recognition that tribal sovereignty

extends no further than over Indian country

land runs through all of the cases cited by

the Circuit Court in support of its position.

See especially, Kinnerly v. District Court,

-21-

400 U.S. 423 and Moe v. Confederated Salish

and Kootenai Tribes, 425 U.S. 462 (1976).

As sole authority for its conclusion that

fee patent land which is not Indian country

is nevertheless “on the reservation" for pur-

poses of the Indian Trader Statutes, the

Circuit Court cites, in a footnote, 25 C.F.R.

§ 251.11 ( F.2d » n.2; Appendix A,

p. 41, n.2). 25 C.F.R. 8 251.11 provides:

"The license period shall corres-

pond to the period of the lease

or permit held by the licensee on

restricted Indian land except that

where the proposed licensee is the

owner ... [of] the land on which

the business is to be conducted,

the license period shall be fixed

by the Commissioner....

The Circuit Court took this to mean that

non-Indian owned fee land is always within

the contemplation of the regulation. Such a

presumption is not required to fairly

construe 25 C.F.R. § 251.11. The land

referred to in this section of the regula- .

tions could be Indian country land owned by a

non-Indian. The Montana case clearly

-22-

recognizes that a non-Indian might be

entitled to own Indian country land in fee.

It does not follow that all fee land, even

within the boundaries of a reservation, is

Indian country land. 25 C.F.R. § 251.11 does

not expressly apply to land which is owned by

non-Indians and which existed before the

reservation was created or which was

withdrawn from the reservation. Therefore 25

C.FP.R. § 251.11 does not necessarily apply to

the Petitioners’ land, and the attempt of the

Circuit Court to make it apply is circular.

The Circuit Court was correct to rely

upon Montana v. The United States for the

disposition of the appeal below. Its

interpretation and application of the Montana

decision, however, is incorrect since it

missed the crucial distinction between the

history of the land involved in Montana

(which was Indian country land) and the land

involved in this case (which was patented

outside the reservation or withdrawn

therefrom and therefore not Indian country).

From misinterpretations of this Court's

ruling based on the Indian country distinc-

tion in Montana v. The United States, the

Circuit Court reasoned to an incorrect and

unjust conclusion in its decision below.

This Court should issue a Writ of Certiorari

in order to correct the conflicting opinions

between this Court and the United States

Court of Appeals for the Ninth Circuit, and

to clarify its ruling in the Montana deci-

sion.

The Circuit Court incorrectly broadened

the force and effect of Montana v. The

United States to include Indian sovereignty

over non-Indian business on non-Indian fee

lands. This result, if left uncorrected,

will lead to further extensions of civil

jurisdiction under Indian sovereign powers

which this Court clearly did not intend when

it rendered the Montana decision.

Accordingly, a Writ of Certivurari should be

issued in this case to avnid the result

directed below and to preserve the correct

rule of law as «nunciated by this Court in

Montana v. The United States.

POINT II

THE CIRCUIT COURT DECIDED AN IMPORTANT

QUESTION PERTAINING TO THE INDIAN TRADERS

STATUTES, 25 U.S.C., 88 261-264, WHICH

HAS NOT BEEN, BUT SHOULD BE, SETTLED BY

THIS COURT.

The Indian Traders Statutes provide

authority to the executive branch of the

federal government to regulate trade with the

Indians and also place very definite limita-

tions upon that authority. The first Section

of the Indian Traders Statutes, 25 U.S.C., §

261 provides that the Commissioner of Indian

Affairs shall have the sole power and

authority to appoint traders to the Indian

Tribes. Section 262 states that “any person

desiring to trade with the Indians on any

Indian reservation" shall be granted a

license if he or she properly qualifies.

Section 263 authorizes the President to pro-

hibit trade “into the country belonging to

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any Indian tribe". Section 264 establishes

forfeiture of merchandise and a penalty for

any person who attempts to “reside in the

Indian country or any Indian reservation, as

a trader or to introduce goods or to trade

therein without such license." The statutes

focus not merely on trade with the Indians,

but trade with those Indians “on any

reservation" or “in Indian country”.

The critical feature in the present case,

as the District Court found, is that the land

upon which Petitioners operate their busi-

nesses is not part of the reservation even

though that land is surrounded by Indian

reservation. In order to come within the

purview of the Indian Traders Statutes, a

person must not only trade with Indians, but

must do so on the reservation. The Circuit

Court found that fee land within reservation

boundaries is in fact “on the reservation”

for purposes of the Indian Traders Statutes.

For its reason, the Circuit Court relied upon

-26-

the language of 25 C.F.R., § 251.11, supra.

The Circuit Court further noted that Part 251

applies to “faJny person other than an Indian

of the full blood." 25 C.F.R., § 251.3.

Thus, the Circuit Court concluded, “this

regulation suggests the regulation's general

application to non-Indian fee land within the

reservation". — F.2d _s at D3

Appendix A, p. 42, n.2 (9th Cir. 1982). This

analysis of a regulation promulgated under

the Indian Traders Statutes, explained above

as being incomplete and circular, allowed the

Circuit Court to determine that the

Petitioners’ businesses were “on the

reservation" for purposes of the Statutes.

The Circuit Court's ruling, even if

validly reasoned, is based upon a false pre-

mise because it conflicts with the clear

meaning and purposes of the Indian Traders

Statutes. The plain meaning of the Indian

Traders Statutes limits the Fe4,ral

government's authority to that over persons

-27-

Soa 7

who “trade with the Indians on any Indian

reservation". The Circuit Court determined

that the Petitioners’ businesses were “on the

reservation" because 25 C.F.R., § 251.11 con-

templates that a proposed Indian trader

licensee may be the owner cf the land on

which the licensed business is to be con-

ducted. This reasoning does not come close

to resolving the important question which was

presented before the Circuit Court. A person

may own land for the purpose of conducting

his business and still be subject to the

Indian Traders Statutes if his land has the

status of Indian country. This is the person

to whom 25 C.F.R. § 251.11 applies because

such land would be “on the reservation" and

business conducted on such land would be

"reservation business" subject to tribal

jurisdiction.

It does not follow, however, that all

persons who own fee land surrounded by a

reservation, and who do business, are in

Indian country and therefore subject to the

Indian Traders Statutes or the regulations

promulgated thereunder, as the Circuit Court

implies. The Circuit Court's decision, if

extended to its logical limits, would make

the Indian Traders Statutes applicable to «

wider class of persons and businesses than is

intended according to the statutes" own

language. It would, for example make the

Indian Traders Statutes applicable to all

businesses in the entire City of Gallup, New

Mexico, which is surrounded by the boundaries

of the Navajo Reservation, but which is

comprised of land that is clearly not Indian

country.

The government's actions in seeking to

require the Petitioners to comply with the

licensing requirements or be closed for

failure to comply, exceeds the authority

granted them by the Indian Traders Statutes.

As the Circuit Court's decision upholds the

legality of the government's action, based

upon a broadening authority in the statutes,

this Court should grant a Writ of Certiorari

in order to resolve the conflict between the

clear meaning of the statutes and the deci-

sion rendered below.

The stipulated facts show that Atkinson's

engages in an insignificant amount of »busi-

ness with members of the Navajo Nation. The

other Petitioners’ businesses involve

substantial transactions with travelers going

to or from state and national parks, monu-

ments, and forests within the Four Corners

region. The District Court found that such a

business obviously does not fall within the

ambit of the Indian Traders Statutes. The

Circuit Court reversed for the reason that

the Petitioners’ lands are all surrounded by

the reservation and brushed aside Atkinson's

lack of significent trade with the Indians as

irrelevant.

We do not think that it was Congress’

intent in enacting the Indian Traders

Statutes that the BIA be authorized to seize

the merchandise of and close a business which

does almost all of its trade with non-

Indians. The position of the BIA would allow

it to prohibit the Petitioners from trading

with other non-Indians, an activity over

which neither the BIA nor the tribe even

arguably has any jurisdiction.

A fair reading of the Ninth Circuit's

decision would enable the Federal government,

and by extension under law, the Indian tribes

themselves, to assert jurisdiction under the

Indian Traders Statutes over all businesses

regardless of the type of trade in which they

are engaged, and regardless of an absence of

impact which those businesses might have on

Indian affairs. The Ninth Circuit's deci-

sion, therefore, has new and far reaching

effect nationwide, and this Court is the

proper one to decide whether such an effect

was intended by Congress in enacting the

Indian Traders Statutes. The importance of

this question, never before passed upon by

this Court, merits review of the Ninth

Circuit's decision.

CONCLUSION

For all the foregoing reasons, a Writ of

Certiorari should issue to review the

judgment and opinion of the Ninth Circuit.

Respectfully submitted this S? aay of

October, 1982.

EAVES AND DARILNG, P.A.

4

By Y | mec Race

1516 San Pedro

Albuquerque, NM 87110

(505) 262-2661