# Amicus Curiae Brief — Kiowa Tribe of Okla. v. Manufacturing Technologies, Inc.

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## Record

- **Collection:** Supreme Court brief
- **Document type:** Amicus Curiae Brief
- **Published:** January 1, 1998
- **Citation:** 523 U.S. 751

## Text

No. 96-1037

In the
Supreme Court of the United States
October Term, 1997

KIOWA TRIBE OF OKLAHOMA,
Petitioner,

Vv.

MANUFACTURING TECHNOLOGIES, INC.,
Respondent.

ON WRIT OF CERTIORARI TO THE COURT OF APPEALS,
DIVISION |, FOR THE STATE OF OKLAHOMA

BRIEF OF AMICUS CURIAE FOND DU LAC
BAND OF LAKE SUPERIOR CHIPPEWA
IN SUPPORT OF PETITIONER

DENNIS J. PETERSON HENRY M. BUFFALO, JR.

Counsel of Record JACOBSON, BUFFALO,
Fond du Lac Legal Office SCHOESSLER &
1720 Big Lake Road MAGNUSON, LTD.
Cloquet, MN 55720 810 Lumber Exchange Bldg.
(218) 879-4593 Ten South Fifth Street

Minneapolis, MN 55402
(612) 339-2071

Attorneys for the Fond du Lac Band
of Lake Superior Chippewa

1997 - Bachman Legal Printing @ (612)339-9518 of 1-800-715-3582 @ FAX (612)337-8053

I.

i
TABLE OF CONTENTS

DETERMINATIONS REGARDING
THE NATURE AND SCOPE OF
TRIBAL SOVEREIGN IMMUNITY
ARE A FUNCTION OF FEDERAL,
NOT STATE, LAW

. THE PRECEDENTS OF THIS COURT

AND OF THE LOWER FEDERAL
COURTS SUPPORT THE
APPLICABILITY OF TRIBAL
IMMUNITY TO A BREACH OF
CONTRACT ACTION ARISING OFF-
RESERVATION

- THE APPLICABILITY OF THE TRIBAL

IMMUNITY DOCTRINE TO TRIBAL
CONTRACTHIAL RELATIONSHIPS
INVOLVING OFF-RESERVATION
PERFORMANCE IS ESSENTIAL TO
THE MAINTENANCE OF TRIBAL
SELF-GOVERNMENT AND TO THE
FULFILLMENT OF THE FEDERAL

TRUST RESPONSIBILITY TO
PRESERVE TRIBAL ASSETS ........csseceseeeeseesenenees

IV. PARTIES TO CONTRACTS WITH
INDIAN TRIBES HAVE WHATEVER
RIGHTS AND REMEDIES AS ARE
RESERVED UNDER THE CONTRACT

CONCLUSION

SOE EEE EEE EEE EEE E EEE HERE EEE

TABLE OF AUTHORITIES

Cases: Page

Aircraft Equip. Co. v. Kiowa Tribe of Oklahoma,
No. 86,184 (Okla. May 6, 1997) oo....cccccccccccccccsscssceeeeeeees 6

Aircraft Equip. Co. v. Kiowa Tribe of Oklahoma,
SR 6

American Indian Agricultural Consortium, Inc
v. Standing Rock Sioux Tribe, 780 F.2d 1374

EE 8, 13, 18
Bank of Oklahoma v. Muscogee (Creek) Nation,

972 F.2d 1166 (10th Cir. 1992)...0.....ccccccccccescesoccesereeseseeee 14
Blatchford v. Native Village of Noatak,

EEE 10
Bryan v. Itasca County, 426 U.S. 373 (1976) cocccccccccccccoeeoooee... 8

C & B Investments v. Wisconsin Winnebago Health Dept.,
198 Wis. 105, 542 N.W.2d 168 (Wis. Ct. App. 1995) .....14

California v. Cabazon Band of Mission Indians.
EEE 8

Cogo v. Central Council of the Tinglit and Haida
Indians, 465 F. Supp. 1286 (D. Alaska 1979) .................... 9

iv
Dixon v. Picopa Const. Co., 160 Ariz. 251,
772 P.2E 12D CEDEDP wcnceccrccsssnssssnscsssesssesvsssvecessescsenesesnseess 15
Elliot v. Capitol International Bank & Trust, Ltd.,
870 F. Supp. 733 (E.D. Tex. 1994), aff'd,
I 7

Federal Power Comm'n v. Tuscarora Indian Nation,
———————————————— 16

First National Bank in Altus v. Kiowa, Comanche and
Apache Intertribal Land Use Comm., 913 P.2d 299

Fond du Lac Band of Chippewa v. Carlson,
Civ. No. 5-92-159 (D. Minn. March 18, 1996),
app. pending, Nos. 97-1757 et al. (8th Cir. 1997)........... 2,3

Gavle v. Little Six, Inc., 555 N.W.2d 284

Hoover v. Kiowa Tribe of Oklahoma, 909 P.2d 59
(Okla. 1995), cert. denied, US. _,

ee 4, 6, 10, 12, 14
In re Greene, 980 F.2d 590 (9th Cir. 1992),

cert. denied sub nom., Richardson v.

Mt. Adams Furniture, 510 U.S. 1039 (1995)............. 6,7, 13

In re Ransom v. St. Regis Mohawk Education
& Community Fund, Inc., 86 N.Y .2d 553,
658 N.E.2d 989, 635 N.Y.S.2d 116 (1995) ............cccceceees 14

v
Iowa Mutual Insurance Co. v. LaPlante, 480 U.S. 9

EEE 2 ee 8
Lac Courte Oreilles Band of Indians v. Wisconsin,

668 F. Supp. 1233 (D. Wis. 1987)...............ccsecscrecrerrsesesees 3
Maryland Cas. Co. v. Citizens Nat. Bank of West

Hollywood, 361 F.2d 517 (Sth Cir.),

cert. denied, 385 U.S. 918 (1966) .............ccccecceeeneereecersevees 13
Maynard v. Narragansett Indian Tribe, 984 F.2d 14

RS Se ea ee 13
Mescalero Apache Tribe v. Jones, 411 U.S. 145 (1973)........ 12
Mille Lacs Band of Chippewa Indians v.

Minnesota, 861 F. Supp. 784 (D. Minn. 1994)................... 3
Montana v. Blackfeet Tribe, 471 U.S. 759 (1985)............c00000- 9
Morgan v. Colorado River Indian Tribe,

EE 15
Nevada v. Hall, 440 U.S. 410 (1979) ...........cccccccecseoes 4, 6,7, 10

New Mexico v. Mescalero Apache Tribe,
eae aiaiimincnitereemnseel 8

North Sea Prods., Lid. v. Clipper Seafoods Co.,
595 P.2d 938 (Wash. 1979) ........c..cccccccvsvceveceeseeeeessssseveeeen 14

Oklahoma Tax Commission v. Citizen Band Potawatomi
Indian Tribe, 498 U.S. 505 (1991) ............... 4,5, 7,8, 9,12

vi

Oneida Indian Nation v. County of Oneida,

OST, Gas CP nennteiettinennciighdeiitnctdunitaiiiemamninineniaia u
Padilla v. Pueblo of Acoma, 754 P.2d 845

(N.M. 1988), cert. denied,

oS Ee 6, 7, 10, 14, 15

Pan American Company v. Sycuan Band of Mission
Indians, 884 F.2d 416 (9th Cir. 1989)............ccccccceceeeeeeeees 13

People v. LeBlanc, 399 Mich. 31, 248 N.W.2d 199 (1976)...14

Puyallup Tribe v. Dep't of Game, 433 U.S. 165

CBU Od cence 4,9, 12
Ramey Const. Co. v. Apache Tribe, 673 F.2d 315

oo: 306 ee ee 14
Sac and Fox Nation v. Hanson, 47 F.3d 1061

ee 14
Santa Clara Pueblo v. Martinez, 436 U.S. 49

ee ee 7, 8, 12
State v. Gurnoe, 53 Wis.2d 390, 192 N.W.2d 892 (1972).....14
Three Affiliated Tribes of Fort Berthold Reservation

v. Wold Engineering Co., 476 U.S. 877 (1986).......8, 12, 16
Tiger v. Western Investment Co., 221 U.S. 286 (1911).......... 1]

Turner v. United States, 248 U.S. 354 (1919).........cccccceceeseesers 8

vii
United States v. Forty Three Gallons of Whiskey,

aI ciiccnicsintanpeieremmpenmtmmpapnmeyenmaces 9
United States v. Michigan, 653 F.2d 277

EE TI aserinsinoctieepinegpiainentipeastepenuscamerrepmmmansnnecaters 3
United States v. Testan, 424 U.S. 392, 399 (1976) ........cc0c00000 9
United States v. United States Fidelity & Guaranty

Oe 8,9, 12
United States v. Wheeler, 435 U.S. 313 (1978) ........cccccceeeeesees 7
United States v. Winans, 198 U.S. 371 (1908) ..........ccccecceeeeee 7
Washington v. Washington State Commercial Passenger

Fishing Vessel Ass'n, 443 U.S. 658 (1979).........ccccecceeeeeees 7
Weeks Construction Co., Inc. v. Oglala Sioux Housing

Authority, 797 F.2d 668 (8th Cir. 1986) .............ccccccceeeeees 11
White Mountain Apache Tribe v. Bracker,

ee He nicintieintnesesnntettaiensienrecenaeninemasnces 8, 10
White Mountain Apache Tribe v. Shelley, 107 Ariz. 4,

Oe citcccsmenimaieniantenreneninensememesnes 14, 15
Worchester v. Georgia, 31 U.S. (6 Pet.) 515 (1832)............... 9

Viii

STATUTES
Federal Torts Claims Act of 1946, 28 U.S.C. §§ 1346(b),

OBOE cessessscserervenengiesteseiepimpdianginmimnmnin 11
Indian Child Welfare Act of 1978, 25 U.S.C. § 1901

GOGO, crssrsersscnstinttiimmnceamnmpemnapartingniapinenents 8
Indian Civil Rights Act of 1968, 25 U.S.C. § 1301 ef seq........8
Indian Financing Act of 1974, 25 U.S.C. § 1451 ef seq............ 8
Indian Gaming Regulatory Act of 1988,

ee 6 re COD ceereemrecittniecegntiantomtrctecseennncion 8
Indian Health Care Improvement Act of 1976,

Be ts he Oe cattcencinrepncnemaantitaninestenctsccersctemease 2
Indian Reorganization Act of 1934,

a i errerencentatiipinictnntesnenscsnseseemeemciens 8,11

Indian Self-Determination and Education
Assistance Act of 1975, 25 U.S.C. § 450 et seq. ...2, 7, 8, 11

Indian Tribal Justice Act of 1993, 25 U.S.C. § 3601
GO ODB, cosceescemtrtmescttiemnemninnsintetaiaietbiammennectesenessenel 8

Indian Tribal Government Tax Status Act of 1982,
8 IT A AE 0 Ae »

Native American Housing Assistance and Self-
Determination Act of 1996, Pub.L. 104-330,
et Oe 2,8

ix
Oklahoma Indian Welfare Act of 1936, 25 U.S.C. § 501

1D GIDE), <cusisinmntncubtantectidmeapatsenninctnengeninseneincngsenreategmncscensenseeses 1]
Treaty of July 29, 1837, 7 Stat. 536 .......cccccccsserseeesereeereesessees 2
Treaty of LaPointe, Sept. 30, 1854, 10 Stat. 1109 0.0.0... 2
Tribally-Controlled Community College Act of 1978,

BP ls Oe ee I cesecttncscnianociarstcnccssenenenseseseenssossteneents 2
OTHER AUTHORITIES
American Bar Association, Model Rules of

Prafeaalamdl CORE cccccccsccscscscssesosessccssessscscsssscscssscsneosecee 17
FAs Cs CII Cte Prccccccssnceccececencsesesserncssssnsnscssmesseen 19
Cohen, Handbook of Federal Indian Law (1982 ed.) ........000+«. 8

Dietrich, Tribal Businesses and the Uncertain Reach of
Tribal Sovereign Immunity: A Statutory Solution,
67 Wash. L. Rev. 113 (1997).........ccccccccsceesseeeeeeeee veeeeevenen 15

Kelly, "Doing Business with Indian Tribes,"
Business North, Avg. 1997 .......0cccccccecsersereeserseseeseereeeeeeeenes 20

Note, /n Defense of Tribal Sovereign Immunity,
Fp ee Bie BRIO. DEN Ce encscnccncvccsccecsscnscsenssnsccsscensvesees 8

Note, Sovereign Immunity -- Indian Tribal Sovereignty --
Tribes Not Immune From Suits Arising From
Off-Reservation Business Activity -- Padilla
v. Pueblo of Acoma, 102 Harv. L. Rev. 556 (1988)............. 7

No. 96-1037

In the
Supreme Court of the United States
October Term, 1997

KIOWA TRIBE OF OKLAHOMA,

Petitioner,
Vv.

MANUFACTURING TECHNOLOGIES, INC.,
Respondent.

On Writ of Certiorari to the Court of Appeals,
Division I, for the State of Oklahoma

BRIEF OF AMICUS CURIAE FOND DU LAC
BAND OF LAKE SUPERIOR CHIPPEWA
IN SUPPORT OF PETITIONER

INTEREST OF AMICUS *

The Fond du Lac Band of Lake Superior Chippewa is a
federally recognized Indian tribe which occupies the Fond du
Lac Reservation in northeastern Minnesota pursuant to the

” Pursuant to rule 37.6 of the Rules of this Court, counsel for amicus
states that no counsel for any party authored this brief in whole or part,
and that no person or entity other that amicus and its counsel made any
monetary contribution to the preparation and submission of this brief.

2

Treaty of LaPointe, 10 Stat. 1109. The Fond du Lac Band
administers a variety of programs for Band members and other
Indians in the Band's service area, including the operation of
educational, housing and health care facilities and also
operates several businesses, including two gaming
establishments,’ a hotel, and a construction company. The
Band operates a health clinic, a group home and a tribal college
off of the Reservation. In addition, the Band maintains a
comprehensive conservation and natural resource management
program in connection with its exercise of hunting, fishing and
gathering rights under the treaties of 1837° and 1854,4 much of
which is federally-funded. Fond du Lac Band of Chippewa v.

Carlson, Civ. No. 5-92-159 (D. Minn. March 18, 1996),

appeal pending, Nos. 97-1757 et al. (8th Cir. 1997).5 The

‘The Band's educational program is funded by the United States
pursuant to the Indian Self-Determination and Education Assistance Act of
1975, 25 U.S.C. § 450 et seq., and the Tribally-Controlled Community
College Act of 1978, 25 U.S.C. § 1801 et seg.; the Band's health care
program is funded by the United States pursuant to the Indian Health Care
Improvement Act of 1976, 25 U.S.C. § 1601 ef seg.; and the Band's
housing program is funded pursuant to the Native American Housing
Assistance and Self-Determination Act of 1996, Pub. L. 104-330, 110
Stat. 4017, to be codified at 25 U.S.C. § 4101 er seq.

* One of the Band's casinos, the Fond-du-Luth Casino, is operated
on tribal trust land in downtown Duluth, Minnesota (approximately 25
miles northeast of the original Reservation) pursuant to a Tribal-City
accord between the Band and the City, under which the City receives 30
percent of the net revenues of the Casino.

* Treaty of July 29, 1837, 7 Stat. 536.
* Treaty of September 30, 1854, 10 Stat. 1109 (Treaty of LaPointe).

"Under the 1837 and 1854 treaties, the Fond du Lac Band has
reserved harvest rights over some 8 million acres of land, from east-central
Minnesota to the Canadian border. The harvest activities of Band
members are exempt from state law only to the extent to which the Band
itself maintains an effective system of self-regulation, which naturally
requires an extensive regulatory and enforcement presence in those off-

3

common purposes of these operations is to improve the
quality of life for Band members and to promote the
continuity and self-determination of the Band as a whole.

The Fond du Lac Band has an interest in this case because
every government program and enterprise operated by the
Band engages in contractual relations involving some degree of
off-reservation performance. The Band routinely enters into
contracts with a variety of off-reservation vendors,
contractors and consultants in its day-to-day operations. The
maintenance of tribal autonomy in the modern world -- which
has been the essence of federal Indian policy for three decades
-- necessitates such interaction. An erosion of the tribal
sovereign immunity doctrine in this case would expose tribes
to unlimited litigation in alien forums which would sap the
tribal resources necessary to the fulfillment of that purpose.
The Band accordingly files this brief to urge this Court to
uphold its earlier decisions regardingthe nature and scope of
tribal sovereign immunity and to hold that the Oklahoma
courts are federally preempted from finding an implicit waiver
of tribal immunity under Oklahoma state law.

Both parties have consented to the filing of this brief
amicus curiae, and those consents have been lodged with the
Clerk.

SUMMARY OF ARGUMENT

The Oklahoma Court of Appeals has in this case
erroneously resolved an issue of tribal sovereign immunity

reservation areas. Fond du Lac Band v. Carlson, slip op. at 25-29 (citing
United States v. Michigan, 653 F.2d 277, 279 (6th Cir. 1981); Mille Lacs
Band of Chippewa v. State of Minnesota, 861 F. Supp. 784, 838-39 (D.
Minn. 1994); Lac Courte Oreilles Band of Indians v. Wisconsin, 668 F.
Supp. 1233, 1241-42 (D. Wis. 1987)).

4

under Oklahoma state law, and has further erred by holding
that the sovereign immunity of the Kiowa Tribe does not bar
State jurisdiction over a breach of contract action against the
Tribe arising off of tribal territory. Issues involving tribal
sovereign immunity are the exclusive province of federal law,
and numerous precedents of this Court provide that tribal
sovereign immunity cannot be waived by implication, but
only through the express and unequivocal consent to suit by
Congress or by the tribe itself.

The primary state precedent relied upon by the
Oklahoma Court of Appeals in this matter, Hoover v. Kiowa
Tribe of Oklahoma, 909 P.2d 59 (Okla. 1995), cert. denied
___ U.S. __, 116 S.Ct. 1675 (1996), has mistakenly applied
the precedent of Nevada v. Hall, 440 U.S. 410 (1979) in
arriving at the conclusion that state court accommodation of
tribal sovereign immunity is a discretionary function of
comity. Nevada v. Hall is inapposite to this matter because
that decision involved an issue of sovereign immunity arising
between two states. Tribes are not states, and unlike the issue
of state immunity in Nevada v. Hall, there is a constitutional
barrier to the resolution of tribal immunity issues under state
law. Indeed, Oklahoma consented to exclusive federal
authority over Indian affairs upon achieving statehood.

The precedents of this Court and of the lower federal
courts support the application of the tribul immunity doctrine
in off-reservation and contractual contexts. The decisions of
this Court regarding tribal immunity have without exception
focused on the sovereign status of the tribes and on the federal
trust responsibility to preserve tribal assets rather than on the
situs of the claim. In Puyallup Tribe, Inc. v. Department of
Game, 433 U.S. 165, 172-73 (1977), tribal immunity was
recognized as a barrier to state jurisdiction over tribal fishing
activities off-reservation, and in Oklahoma Tax Commission

5

v. Citizen Band Potawatomi Indian Tribe, 498 U.S. 505, 509-
11 (1991), this Court held that tribal immunity bars an action
for monetary damages against a tribe. The courts of at least
five federal circuits have accordingly recognized tribal
sovereign immunity as a jurisdictional barrier in contractual
and off-reservation contexts.

As a policy matter, the federal objectives of promoting
tribal self-determination and economic development would be
seriously hampered by a restriction of the availability of tribal
immunity to matters arising exclusively on tribal territory.
The ability of tribes as sovereigns to conduct business
dealings with parties outside of tribal territory is essential to
the maintenance of a meaningful degree of tribal autonomy and
self-determination. Without the benefit of immunity, the
tribes would be faced with the impossible choice of limiting
tribal activity to tribal territory or capitulating to state
authority over tribal interests whenever potential claims can
be pleaded in off-reservation facts. Either alternative would
undermine the federal purposes of protecting the continuity of
tribes as separate peoples.

As a practical matter, the issue of whether tribal
sovereign immunity is to be waived in connection with the
rights or remedies of a party to a commercial arrangement with
a tribe is more appropriately addressed in the negotiation and
formulation of the particular contract at issue. Indian law is a
specialized area, but it is accessible, and there should be no
surprises for a party entering into a transaction with
reasonable preparation and adequate legal counsel. The
immunity issue in the present case would have been
effectively dealt with by an express waiver in the contract
documents.

ARGUMENT

I. DETERMINATIONS REGARDING THE NATURE
AND SCOPE OF TRIBAL SOVEREIGN IMMUNITY

ARE A FUNCTION OF FEDERAL, NOT STATE,
LAW.

The Oklahoma Court of Appeals in this case held that the
state courts of Oklahoma have jurisdiction to hear a breach of
contract action against the Kiowa Tribe, despite the absence
of an express waiver of tribal sovereign immunity by the Tribe
or a consent to suit by Congress, because (1) under Oklahoma
state law such actions could be brought against the Oklahoma
state government, (2) Congress has not expressly prohibited
suit against tribes, and (3) the action does not infringe upon
tribal self-government. Pet. App. 3 (citing Hoover v. Kiowa
Tribe, 909 P.2d 59, 62 (Okla. 1995), cert, denied 5 ae
—— 116 S.Ct. 1675 (1996)).° In effect, the Court of Appeals

* The Oklahoma Supreme Court in Hoover v. Kiowa Tribe cited the
New Mexico Supreme Court's decision in Padilla y. Pueblo of Acoma,
754 P.2d 845 (N.M. 1988), cert. denied, 490 U.S. 1029 (1989), and both
decisions relied upon this Court's decision in Nevada v. Hall, 440 U.S.
410 (1979), that the recognition of the sovereign immunity of one state by
another is a function of comity. Hoover, 909 P.2d at 62; Padilla, 754
P.2d at 850-51. See also Aircraft Equip. Co. v. Kiowa Tribe of
Oklahoma, No. 86,184 (Okla. May 6, 1997) following Hoover in
upholding state court seizure of tribal tax revenues in satisfaction of
judgment); Aircraft Equip. Co. v. Kiowa Tribe of Oklahoma, 921 P.2d
359, 361 (Okla. 1996)(following Hoover in applying state law to tribal
immunity defense); and First Nat'l Bank in Altus v. Kiowa, Comanche
and Apache Intertribal Land Use Comm., 913 P.2d 299, 301 (Okla.
1996) following Hoover in rejecting tribal immunity as a jurisdictional
defense).

The Padilla decision is clearly contrary to the weight of federal
law. See, e.g., In re Greene, 980 F.2d 590, 593-95 (9th Cir. 1993), cert.

7
made the determination of tribal sovereign immunity a
function of state law, found an implicit waiver of tribal
immunity by virtue of the fact that the contract at issue was
performed in part off of the Kiowa Reservation, and
disregarded both the express reservation of tribal rights in the
contract at issue and the preemptive effect of federal law and
policy in this matter.

This Court has long recognized that Indian tribes possess
the same degree of inherent’? common law immunity from suit
as does the United States itself.’ See, ¢.g, Oklahoma Tax

denied sub nom., Richardson v. Mt. Adams Furniture, 510 US. 1039
(1994) Padilla itself recognizes that “[a]bsent federal authorization, tribal
immunity is privileged from diminution by the states, 754 P.2d at 847,
but then assesses the scope of tribal immunity under state
rather than federal law); Elliot v. Capitol International Bank & Trust,
Lid., 870 F. Supp. 733, 734 (E.D. Tex. 1994), aff'd 102 F.3d 549 (Sth
Cir. 1996)("the Padilla approach is generally rejected outside of the courts
of that state"), and Note, Sovereign Immunity — Indian Tribal Sovereignty
-- Tribes Not Immune From Suits Arising From Off-Reservation Business
Activity — Padilla v. Pueblo of Acoma, 102 Harv. L. Rev. 556, 562
(1988\("The {Padilla} court's application of Nevada v. Hall to indian
tribes is not only a simplistic and unsound extension of precedent, but
also a misguided and dangerous encroachment on tribal sovereignty").

” An important feature of tribal sovereign immunity is the fact that it
is not granted by the United States, but rather is a retained attribute of the
preconstitutional sovereign status of a tribe. See, eg, Santa Clara
Pueblo v. Martinez, 436 U.S. 49, 56 (1978); United States v. Wheeler,
435 U.S. 313, 322 (1978). “[T]he treaty was not a grant of rights to the
Indians, but a grant of rights from them -- a reservation of those not
granted." Washington v. Washington State Commercial Passenger
Fishing Vessel Ass'n, 443 U.S. 658, 680 (1979)(quoting United States v.
Winans, 198 U.S. 371, 381 (1908)).

* Consider, e. , that the primary statutory vehicle providing for
federal funding of tribal programs, the Indian Self-Determination and
Education Assistance Act of 1975, contains an express retention of tribal
sovereign immunity. See 25 U.S.C. § 450n ("Nothing in this Act shall

Commission v. Citizen Band Potawatomi Indian T; ribe, 498
U.S. 505, 509-10 (1991); Santa Clara Pueblo v. Martinez, 436
U.S. 49, 58 (1978); Bryan v. Itasca County, 426 U.S. 373,
383-90 (1976); United States v. United States Fidelity &
Guaranty Co., 309 U.S. 506, 512 (1940); Turner v. United
States, 248 U.S. 354, 358 (1919). Federal court adherence to
the tribal immunity doctrine is intended to conserve tribal
assets necessary to achieve the federal policy objectives of
e.g., Citizen Band Potawatomi, supra; Three Affiliated Tribes
of Fort Berthold Reservation v. Wold Engineering Co., 476
U.S. 877, 890-91 (1986); American Indian Agricultural
Consortium v. Standing Rock Sioux Tribe, 780 F.2d 1374,
1378 (8th Cir. 1985); F. Cohen, Handbook of Federal Indian
Law 324-28 (1982 ed.); Note, Jn Defense of Tribal Sovereign
immunity, 95 Harv. L. Rev. 1058, 1072-73 (1982).° “If tribal
assets could be dissipated by litigation, the efforts of the

*The federal policy objectives of tribal economic
development and self-determination have been characterizedby this Coun
as being of an “ iding” nature. See, e.g Citizen Band Potawatomi,

450 et seq.; the Indian Reorganization Act of 1934, 25 U.S.C. § 461 ef
seq.; the Indian Civil Rights Act of 1968, 25 U.S.C. § 1301 ef seg.; the
Indian Financing Act of 1974, 25 U.S.C. § 1451 ef seg.; the Indian Child
Welfare Act of 1978, 25 US.C. § 1901 e seq.; the Indian Gaming
Regulatory Act of 1988, 25 U.S.C. § 2701 ef seq; the Indian Tribal
Justice Act of 1993, 25 U.S.C. § 3601 et seq; the Native American
Housing Assistance and Self-Determination Act of 1996, Pub. L. 104-330,
110 Stat. 4017, to be codified at 25 U.S.C. § 4101 er seg.; and the Indian
Tribal Government Tax Status Act of 1982, 26 U.S.C. § 7871.

9
United States to provide the tribes with economic and
political autonomy could be frustrated." Cogo v. Central
Council of the Tlingit and Haida Indians, 465 F. Supp. 1286,
1288 (D. Alaska 1979).

Tribal sovereign immunity cannot be waived by
implication, but can only be waived through express consent
to suit by Congress or by the tribe itself. See, e.g, Citizen
Band Potawatomi, supra, Puyallup Tribe, supra, 433 U.S. at
172-73; United States Fidelity, supra, 309 U.S. at 512-13.
"[A] waiver of sovereign immunity ‘cannot be implied but
must be unequivocally expressed," and waivers must be
strictly construed in favor of tribal interests. Santa Clara
Pueblo, supra (quoting United States v. Testan, 424 U.S. 392,
399 (1976)). “Absent an effective waiver or consent, it is
settled that a state court may not exercise jurisdiction over a
recognized Indian tribe." Puyallup Tribe, supra, 433 U.S. at
172.

Issues of tribal sovereign immunity, like other aspects of
Indian law, lie within the exclusive authority of the United
States, and cannot be resolved by reference to state law. See
generally Montana v. Blackfeet Tribe, 471 U.S. 759, 764
(1985); Oneida Indian Nation v. County of Oneida, 414 U.S.
661, 671 (1974); United States v. Forty-Three Gallons of
Whiskey, 93 U.S. 188, 195 (1876); and Worchester vy.
Georgia, 31 U.S. (6 Pet.) 515, 561 (1832)(Indian affairs are
the exclusive province of the federal government).

In this case, the Oklahoma Court of Appeals has found
tribal immunity to be waived not by consent to suit but by
the fact that the claims against the Tribe were pleaded in an
off-reservation context. This amounts to an implicit waiver
which, if upheld by this Court, would expose all Indian tribes
to potential state court litigation in virtually any commercial
matter which is not strictly intramural to a tribe and

10
geographically limited to a tribe's reservation. Such a result
would have a tremendous chilling effect upon tribal economic
development and self. inati

The Oklahoma courts, like the New Mexico Supreme
Court in the Padilla case, have avoided the authority of federal
law governing tribal sovereign immunity by analogical
reference to the interstate immunity issue addressed by this
Court in Nevada v. Hall, 440 U.S. 410 (1979). See Hoover v.
Kiowa Tribe, 909 P.2d 59, 62 (Okla. 1995), cert. denied, _
U.S. __, 116 S.Ct. 1675 (1996); Padilla v. Pueblo of Acoma,
754 P.2d 845 (N.M. 1988), cert. denied 490 U.S. 1029
(1989). Nevada v. Hall held that, because the federal
Constitution imposes no requirement for one state to
recognize the immunity of another state, the forum state must
decide for itself whether, and under what conditions, it will
give effect to the immunity of a sister state in its courts. Jd.
440 U.S. at 418-27.

However, the rationale of Nevada v. Hall is inapposite to
issues involving state recognition of tribal sovereign immunity.
The tribes are not parties to the Constitution, and they are not
each state delegated exclusive authority to the federal
government upon entering the Union. See also Blatchford v.
Native Village of Noatak, 501 U.S. 775, 781-82 (1991)(the
mutuality of concession under the Constitution that
surrenders state immunity from suit by a sister state is not
applicable to tribes, “as it would be absurd to suggest that
tribes surrendered immunity in a convention to which they
were not even parties"); White Mountain Apache Tribe vy.
Bracker, 448 U.S. 136, 143 (1980)(tribes “are not States, and
the differences in the form and nature of their sovereignty
make it treacherous to import" by analogy the constitutional
principles affecting one to the other). More to the point,

1]

because the tribal immunity doctrine is a creature of federal
common law, it can only be restated by the United States
itself and, to date, Congress has rarely limited the availability
of tribal immunity.'° This Court specifically held, in Tiger v.
Western Investment Co., 221 U.S. 286 (1911), that “[ijn
passing the enabling act for the admission of Oklahoma ...
Congress was careful to preserve the authority of the United
States over the Indians, their lands and property, which it had
prior to the passage of the act." Jd, 221 U.S. at 309. If there
are to be any changes of the tribal immunity doctrine,
Congress should be the forum within which a focused and

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12

The precedents of this Court addressing tribal sovereign
immunity support the applicability of tribal immunity as a
jurisdictional barrier to a breach of contract action arising off-
reservation and brought in state court. Those decisions,
without exception, focus on the preconstitutional sovereign
status of the tribes and on the federal trust responsibility of
draw no distinction based on the situs of the claim.'' See, e.g.,
Oklahoma Tax Commission v. Citizen Band Potawatomi
Indian Tribe, 498 U.S. 505, 509-10 (1991); Three Affiliated
Tribes of Fort Berthold Reservation v. Wold Engineering Co.,
476 U.S. 877, 890-91 (1986); Santa Clara Pueblo v. Martinez,
436 U.S. 49, 56-58 (1978); United States v. United States
Fidelity & Guaranty Co., 309 U.S. 506, 512 (1940). Indeed, in
Puyallup Tribe, Inc. v. Dep't of Game, 433 U.S. 165 (1977),
this Court held that tribal immunity barred state jurisdiction
over a tribe arising out of the tribe's exercise of treaty-reserved
fishing rights on and off the reservation. Jd, 433 U.S. at 172-
73. In Citizen Band Potawatomi, this Court recognized that
tribal immunity bars an action for monetary damages against a
tribe. Jd, 498 U.S. at 509-11.

At least five federal circuits have interpreted this Court's
articulation of the tribal sovereign immunity doctrine as

"In Hoover v. Kiowa Indian Tribe of Oklahoma, 909 P.2d 59, 61
(Okla. 1995), cert. denied __ US. __» 116 S.Ct. 1675 (1996), the
Oklahoma Supreme Court relied upon the statement of this Court in
Mescalero Apache Tribe v. Jones, 411 U.S. 145 (1973), that "[absent
express federal law to the contrary, Indians going beyond reservation
boundaries have generally been held subject to nondiscriminatory state law
otherwise applicable to all citizens of the State.” Id, 411 U.S. at 148-49.
However, Mescalero does not mention tribal immunity from suit, and, as
recognized by this Court in Citizen Band Potawatomi, the legal
applicability of a state law to an Indian tribe is a distinct and

separate
issue from the ability of the state to enforce compliance. Id, 498 U.S. at
$14.

13
extending to tribal commercial activities and/or to tribal
conduct off-reservation. In Maynard v. Narragansett Indian
Tribe, 984 F.2d 14 (1st Cir. 1993), the First Circuit held that
tribal sovereign immunity barred state jurisdiction over
trespass actions against the Tribe arising off-reservation.

In Maryland Cas. Co. v. Citizens Nat. Bank of West
Hollywood, 361 F.2d 517, 521 (Sth Cir.), cert. denied 385
U.S. 918 (1966), the Fifth Circuit held that tribal immunity is
available to bar an action arising out of tribal commercial
activities in the same manner as to a tribe generally, because
"[i}t is in such enterprises and transactions that the Indian
tribes and Indians need protection."

In American Indian Agricultural Consortium v. Standing
Rock Sioux Tribe, 780 F.2d 1374, 1378 (8th Cir. 1985), the
Eighth Circuit held that tribal immunity barred jurisdiction
over a breach of contract action, emphasizing the fact that
immunity is "necessary to promote tribal self-determination,
economic development, and cultural autonomy."

In Pan American Co. v. Sycuan Band of Mission Indians,
884 F.2d 416, 419 (9th Cir. 1989), the Ninth Circuit held that
tribal immunity barred jurisdiction over a breach of contract
action arising out of a bingo agreement with the Band, noting
that "[cJonsent [to suit] by implication, whatever its
justification, still offends the clear mandate of Santa Clara
Pueblo." Also, in Jn re Greene, 980 F.2d 590, 596 (9th Cir.
1993), cert. denied sub nom., Richardson v. Mt. Adams
Furniture, 510 U.S. 1039 (1994), the Ninth Circuit held that
tribal immunity barred suit by a bankruptcy trustee against a
furniture business owned by a tribe arising out of an off-
reservation transaction, citing this Court's continuous and
broad reaffirmation of the tribal immunity doctrine as
requiring recognition that tribal immunity under federal
common law contains an "extraterritorial component."

14

Most notably, for the purposes of this case, the Tenth
Circuit, in Sac and Fox Nation v. Hanson, 47 F.3d 1061 (10th
Cir.), cert. denied, __ U.S. ___, 116 S.Ct. 57 (1995), held
that tribal immunity bars state court jurisdiction over third
party claims for damages brought by employees of a former
manufacturing plant operated by the Nation off-reservation,
and that the location of tribal commercial activity cannot be
determinative of whether a tribe is entitled to immunity
because "the point of sovereign immunity ... is the power of
self-determination." /d., 47 F.3d at 1064 (quoting Bank of
Oklahoma v. Muscogee (Creek) Nation, 972 F.2d 1166, 1169
(10th Cir. 1992)); see also Ramey Const. Co. v. Apache Tribe,
673 F.2d 315, 320 (10th Cir. 1982)(upholding dismissal of
breach of contract action on tribal immunity grounds).

The rule on tribal immunity is settled law in the federal
courts. Further, the Padilla and Hoover decisions are not
representative of state court understandings of the doctrine.
See, e.g., Gavie v. Little Six, Inc., 555 N.W.2d 284, 292-96
(Minn. 1996)(recognizing immunity of tribal corporation for
civil claims partially arising off-reservation); Jn re Ransom vy.
St. Regis Mohawk Education & Community Fund, Inc., 86
N.Y.2d 553, 560, 658 N.E.2d 989, 993, 635 N.Y.S.2d 116,
120 (1995)(immunity extends to a tribally-owned nonprofit
corporation chartered under state law); C & B Investments v.
Wisconsin Winnebago Health Dept., 198 Wis. 105, __, 542
N.W.2d 168, 170 (Wis. Ct. App. 1995)(immunity extends to
tribal health board in breach of contract action); North Sea
Prods., Lid. v. Clipper Seafoods Co., 595 P.2d 938, 941
(Wash. 1979)(immunity bars state garnishment action against
tribe despite tribal commercial activity off-reservation);
People v. LeBlanc, 399 Mich. 31, _, 248 N.W.2d 199, 212-
13 (1976)(tribe immune from state regulation of treaty-
reserved fishing off-reservation); State v. Gurnoe, 53 Wis.2d

15

390, __, 192 N.W.2d 892, 902 (1972)(same); White
Mountain Apache Tribe v. Shelley, 107 Ariz. 4, 7, 480 P.2d
654, 657 (1971)(immunity extends to _ tribally-owned
business); and Morgan v. Colorado River Indian Tribe, 443
P.2d 421, 423 (Ariz. 1968)(immunity applies to claims arising
from accident at tribally-owned amusement park off-
reservation).'? The rationale of the Hoover decision, and of
the Oklahoma Court of Appeals in the present case, are at
odds with the observance of the immunity doctrine in other
states. Indeed, it is the view of the Fond du Lac Band that
this case, when considered in the overall context of the
generally litigious posture towards tribes by the State of
Oklahoma, is indicative of a fundamental intolerance of tribal
existence itself.

Ill. THE APPLICABILITY OF THE TRIBAL
IMMUNITY DOCTRINE TO TRIBAL
CONTRACTUAL RELATIONSHIPS INVOLVING
OFF-RESERVATION PERFORMANCE IS
ESSENTIAL TO THE MAINTENANCE OF TRIBAL
SELF-GOVERNMENT AND TO THE
FULFILLMENT OF THE FEDERAL TRUST
RESPONSIBILITY TO PRESERVE TRIBAL
ASSETS.

" Contra Dixon v. Picopa Const. Co., 160 Ariz. 251, __, 772
P.2d 1104, 1107-10 (1989)tribally-owned corporation governed by a
tribally-elected board of directors deemed to be too far removed from tribal
control to benefit from immunity). For a critique of the Dixon and Padilla
decisions, see Dietrich, Tribal Businesses and the Uncertain Reach of
Tribal Sovereign Immunity: A Statutory Solution, 67 Wash. L. Rev. 113,
124-27 (1997).

16

Tribal sovereign immunity, and the purposes underlying
the immunity doctrine, cannot be limited to the on-reservation
or governmental functions of the tribe without seriously
impairing the ability of tribes to maintain any appreciable
degree of autonomy or self-determination. As recognized by
this Court in Three Affiliated Tribes of Fort Berthold
Reservation v. Wold Engineering Co., 476 U.S. 877 (1986),
"[t]he common law sovereign immunity possessed by the
Tribe is a necessary corollary to Indian sovereignty and self-
governance." Jd, 476 U.S. at 891. The real success of the
immunity doctrine in achieving these federal policy purposes
is not found in the cases arising in which tribal immunity is
raised as a jurisdictional defense, but in the doctrine's deterrent
effect of discouraging the multitude of claims that would
otherwise be brought. Without the benefit of immunity, tribal
self-government and economic development would be
undermined by an endless stream of claims against tribal
resources grounded in state law and pleaded in off-reservation
facts.

The preservation of the tribal immunity doctrine is
essential to tribal survival because the continued vitality of
tribes depends upon their ability to maintain their measured
separatism without converting reservations to detention areas
outside of which tribes dare not venture for fear of loss of
their sovereign identity. Meaningful tribal self-determination
requires that tribes have the ability to conduct business with
the outside world without becoming subordinate to and
assimilated by the laws of the dominant culture. This is the
essential promise by the United States to the tribes, in every
treaty and statute: "we will protect you against extinction."
And, as Justice Black stated: "Great nations, like great men,
should keep their word." Federal Power Comm'n vy.

17

Tuscarora Indian Nation, 362 U.S. 99, 142 (1960)Black, J.,
dissenting).

IV. PARTIES TO CONTRACTS WITH INDIAN TRIBES
HAVE WHATEVER RIGHTS AND REMEDIES AS
ARE RESERVED UNDER THE CONTRACT
DOCUMENTS. |
Parties to contractual relationships with Indian tribes are

not at a legal disadvantage or disability simply because the

legal rules applicable to such transactions reside in a

specialized area. A contract between an Indian tribe and an

off-reservation business is not unlike a transaction between
any two parties in a market economy: both parties are
presumed to negotiate the transaction with their "eyes open,"
and are each responsible for researching the merits and
contingencies of a proposal, and for obtaining the appropriate
professional advice before entering into a contract. To the

extent that legal advice is sought in connection with a

proposed transaction, the rules of professional conduct for

attorneys universally require a lawyer to render competent
representation, which includes the responsibility to provide

"the legal knowledge, skill, thoroughness and preparation

reasonably necessary for the representation." American Bar

Association, Model Rules of Professional Conduct Rule 1.1

(1983). The rule of competence further requires an attorney

to recognize whether it is necessary “to refer the matter to, or

associate or consult with, a lawyer of established competence

in the field in question." Jd, Comment 1.

The unique rules governing Indian law generally, and the
tribal immunity doctrine in particular, are the law of the land,
and are the basis of settled expectations by the tribes, federal

18

and state governments, and members of the business
community. The Oklahoma and New Mexico courts have
attempted to restate the rules regarding tribal immunity in a
manner which directly contravenes two centuries of federal
common law. The Kiowa Tribe is presently bearing the
burden of their experiment. However, such a drastic change in
tribal immunity law is neither necessary or desirable, and
poses a direct challenge to the exclusivity of federal control
over Indian affairs in our Nation.

"Tribes and persons dealing with them long have known
how to waive sovereign immunity when they so wish."
American Indian Agricultural Consortium v. Standing Rock
Sioux Tribe, 780 F.2d 1374, 1379 (8th Cir. 1985). A business
that is pursuing a particular transaction with a tribe may
negotiate an express waiver of tribal immunity as a condition
of the transaction, and the tribe will presumably decide
whether the particular proposal is important enough to tribal
interests to grant such a waiver. If a waiver had been
negotiated as part of the contract at issue in the present case,
this case would not have been necessary. Because the Kiowa
Tribe has the authority to waive its immunity in a contract, it
is in the negotiation and language of the contract at issue in the
present case that the question of a waiver should have been
addressed. If a waiver had been granted, immunity would not
have been unavailable as a jurisdictional defense by the Tribe
in connection with that contract, and this case would not have
been necessary. However, Manufacturing Technologies, Inc.
did not insist on a waiver as part of the transaction, and in fact
agreed to a deal which expressly reserved the sovereign rights
of the Tribe. The sovereign rights of the Kiowa Tribe which
were expressly reserved in the promissory note at issue are
reserved under federal statutory and common law, and include
the right to assert sovereign immunity against the unconsented

19

operation of state law upon the Tribe. For this Court to make
further inquiry into this matter would depart from the cardinal
principle of contract law that "the meaning of a contract must
be determined from the four corners of the instrument." 17A
C.J.S. Contracts § 296(2)(1963).

The Fond du Lac Band is a party to contracts with off-
reservation businesses amounting to several million dollars a
year. It has been the experience of the Band that attorneys
representing those businesses are aware of the tribal immunity
doctrine, and either negotiate the terms for a waiver of
immunity, or secure alternative remedies, within the contract.
There are no secrets or surprises, only a unique body of law
reflecting the unique legal status of the Band as a federally
recognized Indian tribe. A radical change in the law on tribal
immunity would severely disrupt settled law and
expectations.

A recent article in a northern Minnesota business
publication concerning the conduct of business between a tribe
and off-reservation vendors stated:

Nearly every business transaction is the product of
some negotiation. Because a tribal government may
waive its sovereign immunity, a non-tribal business
seeking to supply goods or services under contract
may try to negotiate a provision that may be open to
linking dispute resolution in a tribal court using a
specified legal framework, specified by the UCC or
some other common body of business law ...

Doing business with tribes requires adjusting to
unfamiliar rules. It also may require submitting

20

disputes to a tribal court. Don't let that be a barrier.
Instead, take care to ensure dispute resolutions are
spelled out in the contract, and understood by all
parties at the onset.

John D. Kelly, "Doing Business with Indian Tribes," Business
North, August 1997, p. 13.

The point is, the tribal immunity doctrine works as an
instrument of achieving the purposes of federal Indian policy,
but needn't constitute an obstacle to a fairly negotiated
contractual quid pro quo, provided that the parties to
contracts with tribes are diligent in the protection of their own
interests; however, in the event that they are not attentive to
the unique legal status of the tribes, it is not an appropriate or
desirable function of federal law or of this Court to protect
them from their own deals.

CONCLUSION

Tribal sovereign immunity is exclusively governed by
federal law. The State of Oklahoma's denial of the availability
of tribal immunity as a jurisdictional defense by the Kiowa
Tribe in this case is contrary to the overwhelming weight of
federal authority, including numerous precedents of this
Court. Further, a limitation of the immunity doctrine at this
late time to commercial disputes arising in tribal territory
would contravene the federal policy of promoting tribal self-
determination and economic development, and would interfere
with the settled expectations of the tribes and parties doing
business with tribes by over a century of federal precedent.
The appropriate place to address the tribal immunity issue in
commercial dealings is in the negotiation and structure of
individual contracts.

21

For these reasons, the decision of the Oklahoma Court of
Appeals in this matter should be reversed.

Respectfully submitted,

DENNIS J. PETERSON HENRY M. BUFFALO JR.

Counsel of Record JACOBSON, BUFFALO
Fond du Lac Legal Office SCHOESSLER&
1720 Big Lake Road MAGNUSON, LTD.
Cloquet, MN 55720 810 Lumber Exchange Bldg.
(218) 879-4593 Ten South Fifth Street

Minneapolis, MN 55402
(612) 339-2071

Attorneys for the Fond du Lac Band
of Lake Superior Chippewa

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385014_0046%3A12. Public record. Not legal advice.