Amicus Curiae Brief — Kiowa Tribe of Okla. v. Manufacturing Technologies, Inc.
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— AUG 25 1997
No. 96-1037
Supreme Court, U Ss 7
ad
In THE
Supreme Court of the United States
OCTOBER TERM, 1997
KIOWA TRIBE OF OKLAHOMA,
7 Petitioner,
MANUFACTURING TECHNOLOGIES, INC..,
Respondent.
On Writ of Certiorari to the
Oklahoma Court of Appeals
BRIEF AMICI CURIAE OF THE ASSINIBOINE AND
SIOUX TRIBES OF THE FORT PECK RESERVATION,
HO-CHUNK NATION, NOTTAWASEPPI HURON BAND
OF POTAWATOMI INDIANS, STANDING ROCK SIOUX
TRIBE, CONFEDERATED TRIBES OF THE COLVILLE
RESERVATION, AND ST. CROIX CHIPPEWA INDIANS
OF WISCONSIN IN SUPPORT OF PETITIONER
WILLIAM R. PERRY *
DOUGLAS B.L. ENDRESON
ANNE D. Noto
SONOSKY, CHAMBERS, SACHSE
& ENDRESON
1250 Eye Street, N.W.
Suite 1000
Washington, D.C. 20005
(202) 682-0240
Attorneys for Amici Curiae
August 25, 1997 * Counsel of Record
WILSON - Eres PriInTING Co., Inc. - 789-0096 - WASHINGTON, D.C. 20001
TABLE OF CONTENTS
I. UNDER SETTLED RULES OF FEDERAL
LAW, TRIBES ARE IMMUNE FROM SUIT
ABSENT AN ACT OF CONGRESS OR THE
TRIBE’S EXPRESS WAIVER OF THAT IM-
MUNITY, AND STATES LACK JURISDIC-
TION OVER TRIBES THAT HAVE NOT
A. Tribal Sovereign Immunity, as an Aspect of
a Tribe’s Inherent Sovereignty, Is Protected
by Federal Law and May Only Be Waived
. FEDERAL LAW DOES NOT PERMIT THE
LOWER COURT’S TEST UNDER WHICH
THE EXISTENCE OF A TRIBE’S SOVER-
EIGN IMMUNITY TURNS ON WHETHER
SOME ASPECT OF THE TRANSACTION
OCCURS ON OR OFF RESERVATION
ii
TABLE OF CONTENTS—Continued
A. A Damages Action Against a Tribe Is Per
Se an Action Against the Tribe on the
Ea
B. The Lower Court’s Test Would Obviate the
Protections Intended by Immunity and Im-
permissibly Condition the Tribe’s Access to
Off-Reservation Resources on a Waiver of
Foe Fassel q..n.cocccccciesstnssuecessseseecemanncnaninnns
Ill. THE EXISTING FEDERAL RULES GOV-
ERNING TRIBAL IMMUNITY PROVIDE
CLEAR STANDARDS UNDER WHICH PER-
SONS SEEKING TO DO BUSINESS WITH
INDIAN TRIBES CAN SECURE ENFORCE-
ABLE REMEDIES ............. sossrevesncinacentiiiaendiaainiea
CONCLUSION ......-220.-200<cco-eeceoscssernsconsenecencnssnnneosesssonessonnesees
Page
19
iii
TABLE OF AUTHORITIES
Cases
Adams v. Murphy, 165 F. 304 (8th Cir. 1908)
Aircraft Equipment Company v. Kiowa Tribe of
Oklahoma, 921 P.2d 359 (Okla. 1996) ...........
Altheimer & Gray v. Sioux Mfg. Corp., 983 F.2d
803 (7th Cir.), cert. denied, 510 U.S. 1019
(1993) ..
American Indien Agricultural Credit Consortium,
Ine. v. Standing Rock Sioux Tribe, 780 F.2d 1374
(8th Cir. 1985) ...
Antoine v. Washington, 420 US. 194 (1975) ..
Arizona v. . trweahtecmme Tribe, 463 U.S. 545
(1983) ..
Blatchford v. . Native Village of ‘Noatak, B01 ‘US.
EE ES
Board of oer Comm'rs v. Seber, 318 U. S. 705
(1943) ..
Bottomly v. | Passamaquoddy Tribe, 599 F.2d 1061
EE
Page
13
Bryan v. Itasca County, 426 U.S. 373 (1976)... 6, 9, 11
California v. Cabazon Band of Mission Indians,
EE
Central Machinery Co. v. Arizona Tax Comm'n,
I ee
Chemehuevi Tribe v. California State Board of
Equalization, 757 F.2d 1047 (9th Cir.), rev
on other gro. ids, 474 U.S. 9 (1985) |
The Cherokee Intermarriage Cases, 203 US. 16
(1903) ..
The Cherokee Trust Funds, UITUS. 288 (1886)
Dellmuth v. Muth, 491 U.S. 223 (1989)...
Dick v. United States, 208 U.S. 340 (1908) eae
Elliott v. Capital Investment Bank, 870 F. Supp.
733 (E.D.Tex. 1994), aff'd, 102 F.3d 549 (5th
Cir. 1996).
First National Bank in Altus v. Kiows, ‘Comenche,
and Apache Intertribal Land Use Committee,
a
Fontenelle v. Omaha Tribe of Nebraska, 430 F.2d
Ee
16
16
iv
TABLE OF AUTHORITIES—Continued
Frederico v. Capital Gaming Int'l Inc., 888 F. Supp.
OIG yy ae
Green v. Menominee Tribe, 233 U.S. 558 (1944).
Green v. Mt. Adams Furniture, 980 F.2d 590 (9th
Cir. 1992), cert. denied, 510 U.S. 1039 (1994)...
Haile v. Saunooke, 246 F.2d 293 (4th Cir. 1957)...
Healing v. Jones, 210 F. Supp. 125 (D. Ariz. 1962),
GG, GED Te. Tee Cie wctenrerccesicecsintcteenateniniens
Hoover v. Kiowa Tribe of Oklahoma, 909 P.2d 59
(Okla. 1995), cert. denied, 116 S.Ct. 1675
SS ee a ee
Idaho v. Coour d'Alene Tribe, 65 US.LW. 4540
ar a ee
Indian Towing Co. v. United States, 350 U.S. 61
CC SS ee
lowa Mutual Ins. Co. v. LaPlante, 480 U.S. 9
a
The Kansas Indians, 72 U.S. (5 Wall.) 737
0 ee
Kiowa Indien Tribe of Oklahoma + v. ‘Hoover, Civ.
96-8438-C (W.D.Okl. Nov. 1996) —.........................
Lac Courte Oreilles Band v. Wisconsin, 668 F.
— OS OB A oO
Manufacturing Technologies, Ine. v. Kiowa Tribe
of Oklahoma, No. 86,489 (Okla. App. June 28,
SSS 2 See eee ee
Manufacturing Technologies, Inc. v. Kiowa Tribe,
No. CJ 98-6523 (District Court, Oklahoma
0, es eS ee ae
Maryland Casualty Co. v. Citizens National Bank
of West Hollywood, 361 F.2d 517 (5th Cir.),
10
16
cert. denied, 385 U.S. 918 (1966) ...............18, 15, 28
Maynard v. Narragansett Indian Tribe, 984 F.2d 14
0.) >a ee
Merrion v. Jicarilla Apache Tribe, 617 F.2d 537
(10th Cir. 1980), aff'd on other grounds, 455
FF ee ee es
McClendon v. United States, 885 F.2d 627 (9th
9 eae eee
14
v
TABLE OF AUTHORITIES—Continued
Page
Mescalero Apache Tribe v. Jones, 411 U.S. 145
iat ae Bi Aime ten ot Tt Acie SM RE A 19
Mitchell v. Forsyth, 472 U.S. 511 (1985)... 19, 21
Montana v. Blackfeet Tribe, 471 U.S. 759 (1985). 9
Morton v. Mancari, 417 U.S. 5385 (1974) 9
National Farmers Union Ins. Co. v. Crow Tribe,
iE ae RC al ts a ll
Nevada v. Hall, 440 U.S. 410 (1979) 8, 9, 11, 12
New Mexico v. Mescalero Apache Tribe, 462 U.S.
Ret acini Me TE Ei eS SP Le eae Se ay 16
Oklahoma Tax Comm'n v. Citizen Band of
Potawatomi Indian Tribe, 498 U.S. 505 (1991). 7, 13,
14, 15, 16, 19
Oklahoma Tax Comm'n v. Graham, 489 U.S. 838
(1989) . 7,11
Oneida Indian ‘Nation ¢ v. . County of Oneida, 414
On 9
Parker v. Richard, 250 U.S. 235 (1919) 11
Puerto Rico Aqueduct v. Metcalf & Eddy, 506 U.S.
RE Se a ee ee 19
Puyallup Tribe v. Washington Dep't of Game, 433
U.S. 165 (1977) .. 6, 8, 12, 13
Rosebud Siouz v. Val-U Const. Co., “50 F.3d 560
(8th Cir. 1995), cert. denied, 116 S.Ct. 78
CS AG ERE ee SS ee 13, 23
Sae & Fox Nation v. Hanson, 47 F.3d 1061 (10th
Cir.), cert. denied, 116 S.Ct. 57 (1995)... 14, 23
Santa Clara Pueblo v. Martinez, 436 U.S. 49
RE 5, 6, 7, 8, 12, 13, 15, 18, 19, 22
Seminole Tribe of Florida v. Florida, 517 U.S.
—, 134 L.Ed.2d 252 (1996) . . 9,19
Settler v. Lameer, 507 F.2d 231 (9th Cir. 1974). 16
Sokaogon Gaming Enterprises v. Tushie Mont-
gomery Assoc., 86 F.3d 656 (7th Cir. 1996)... 23
Strate v. A-1 Contractors, 65 U.S.L.W. 4298 (U.S.
a Rat A a 11
Thebo v. Choctaw Tribe, 66 F. 372 (8th Cir.
TELE ene Ee el A A 13, 18
vi
TABLE OF AUTHORITIES—Continued
Page
Turner v. United States, 248 U.S. 354 (1919) ........ 7,12
United States v. Forty-Three Gallons of Whiskey,
2k SF Es es _ 10, 16
United States v. King, 395 U.S. 1 (1969) _............ 12
United States v. Mazurie, 419 U.S. 544 (1975)... 9
United States v. Michigan, 471 F. Supp. 192 (W.D.
i See eer ere ee 16
United States v. Testan, 424 U.S. 392 (1976)... 12
United States v. United States Fidelity & Guar-
anty Co., 309 U.S. 506 (1940) 7, 8, 12,18
United States v. Washington, 520 F.2d 676 (9th
Cir. 1975), cert. denied, 423 U.S. 1086 (1976)... 16
Weeks Const. Co. v. Oglala Sioux Housing Auth.,
797 F.2d 668 (8th Cir. 1986)... 15, 23
White Mountain Apache Tribe v. Bracker, 448
DERE 9
Worcester v. Georgia, 31 U.S. (6 Pet.) 515
ee Se eas Sen. See EL A 9, 10
Constitution and Statutes
OS 10
Act of July 10, 1952, c. 651, Title II, § 208(a)-
(c), 66 Stat. 560, codified at, 43 U.S.C. § 666... 14
Act of July 22, 1958, Pub. L. No. 85-547, 72 Stat.
ee ek ee 14
Act of November 5, 1990, Pub. L. No. 101-512,
Title ITI, § 314, 104 Stat. 1969 17
Act of November 11, 1993, Pub. L. No. 103-138,
Title III, § 308, 107 Stat. 1416 2... 17
American Indian Agricultural Resource Manage-
ment Act of 1993, 25 U.S.C. § 3746 _.... eee 16
Appropriations Act of March 3, 1883, c. 141, 22
OS es ae 14
Appropriations Act of March 3, 1905, c. 1479, § 1,
ee GN, I cheeeninctencinintintinntncitiioes 14
Improving America’s Schools Act of 1994, 20
I‘ ( ee 18
Indian Civil Rights Act, 25 U.S.C. §§ 1301-1303__ 15
Indian Child Welfare Act, 25 U.S.C. §§ 1931-1933.. 17
vii
TABLE OF AUTHORITIES—Continued
Page
Indian Employment, Training and Related Serv-
ices Demonstration Act of 1992, 25 U.S.C.
RCE eae a ee ee ee 18
Indian Financing Act, 25 U.S.C. § 1621 ..00.... 17
Indian Health Care Improvements Act, 25 U.S.C.
a A RE 17, 18
Indian Reorganizaiton Act of 1934, 25 U.S.C.
I alll 15
EEE, RE a a en 15
Indian Self-Determination and Education Assist-
ance Act of 1975, 25 U.S.C. §§ 450 et seq. _3, 15, 16, 17
25 U.S.C. § 450f(c) (3) (A) 000. 15
I i 16
Indian Trader Statutes, 25 U.S.C. $§ 261-264 are 16
Native American Housing Assistance and Self-
Determination Act of 1996, Pub. L. No. 104-330,
§ 2(6), 110 Stat. 4018 (1996)... J 18
Non-Intercourse Act, 25 U.S.C. § 177 —........ 16
Miscellaneous
The Federalist No. 42 (J. Cooke ed. 1961)... 10
Goodrich & Scoles, Conflict of Laws (4th ed.
EEE EE Rs 22556 ECS ae a ee 21
Journals of the Continental Congress, 1774-1 789,
(Lib. of Cong. ed. 1904-1987) ........... 10
Restatement (Second) of Conflict of Lewe (1971). 21
IN THE
Supreme Court of the United States
OCTOBER TERM, 1997
No. 96-1037
KIOWA TRIBE OF OKLAHOMA,
» Petitioner,
MANUFACTURING TECHNOLOGIES, INC.,
Respondent.
On Writ of Certiorari to the
Oklahoma Court of Appeals
BRIEF AMICI CURIAE OF THE ASSINIBOINE AND
SIOUX TRIBES OF THE FORT PECK RESERVATION,
HO-CHUNK NATION, NOTTAWASEPPI HURON BAND
OF POTAWATOMI INDIANS, STANDING ROCK SIOUX
TRIBE, CONFEDERATED TRIBES OF THE COLVILLE
RESERVATION, AND ST. CROIX CHIPPEWA INDIANS
OF WISCONSIN IN SUPPORT OF PETITIONER
INTEREST OF AMICI’
Each of the Amici Tribes is a federally recognized
Indian tribe responsible for providing a broad range of
governmental services in areas such as education, health
care, employment, housing, environmental protection, nat-
1 Pursuant to Rule 37.6 of the Rules of this Court, counsel for
Amici states that no counsel for a party authored this brief in
whole or part, and that no person or entity other than Amici and
their counsel made any monctary contribution to the preparation or
submission of this brief. All parties have consented to the filing
of this brief amici curiae, and those consents have been filed with
the Clerk.
2
ural resource management, and law enforcement to In-
dians and other people living on and near their reserva-
tions. Each faces tremendous challenges in carrying out
these duties. For each of these tribes, the size* and
location® of its reservation has resulted in significant
? For example, the Ho-Chunk Nation has 5779 members and only
845.23 acres of trust land scattered over 14 Wisconsin counties.
According to tribal census records, it had 22.5% unemployment in
1990, while unemployment among all Wisconsin residents was
4.4°.. In 1995, 64% of Ho-Chunk households had incomes less than
50% of the median county income. The St. Croix Chippewa Indians
of Wisconsin is similarly situated. It occupies only 3,000 acres of
land that are dispersed across three Wisconsin counties, and is
responsible for providing services to approximately 3500 member
and non-member Indians. As reported by the 1990 U.S. Census,
Indians at St. Croix had median household incomes of $14,500,
with only 29° owning homes, while the median household income
for all Wisconsin residents was $28,000, with 67° owning homes.
Similarly, the Nottawaseppi Huron Band of Potawatomi Indians
holds only 120 acres of land as a reserve in Michigan. The Band
has 612 members with 25° unemployment.
® The isolated locations of the reservations occupied by the Stand-
ing Rock Sioux Tribe, the Assiniboine and Sioux Tribes of the
Fort Peck Reservation, and the Confederated Tribes of the Colville
Reservation, have left each with unemployment and poverty rates
that are two to four times the national average, with correspond-
ingly higher deficits in health and education. For example, as of
1990 the median household income for all persons nationwide was
$30,056, with only 13.1% of the U.S. population living below the
poverty level. See Indian Health Service, Regional Differences in
Indian Health 1995, at 27. But for Indians within the Aberdeen
Area of the Bureau of Indian Affairs, including those on the
Standing Rock Sioux Reservation, the median household income
was $12,310, with 49.6% living below the poverty level. Jd. For
Indians within the Billings Area, including those on the Fort
Peck Reservation, median household income was $14,249 with
44.6% living in poverty. Jd. And for Indians within the Portland
Area, including those at Colville, the median income was $21,123,
with 29.2% living in poverty. Jd. Nationwide, the unemployment
rate among men in 1990 was 6.4%, but among Indian men within
the Aberdeen Area the rate was 26.5%, and within Billings, 29.8%.
Id. at 26. The health problems affecting Indian people are evi-
3
barriers to its ability to foster economic development on
the reservation, and has left a legacy of high levels of
unemployment and poverty, inadequate housing, poor
health, and lack of educational opportunity.
To address these problems, all Amici Tribes have un-
dertaken to establish business and economic activities on
their reservations that will enable the tribes to provide
the facilities and services necessary to meet the needs
of their citizens. This has become all the more important
as federal spending on programs for American Indians
has declined *—putting greater pressure on tribes to de-
velop sources of revenue from which to fund these govern-
mental responsibilities.
Moreover, for each of these tribes, many goods and
services required for fundamental government operations
are simply unavailable on the reservation. Tribes must
go outside of Indian country to acquire essential com-
modities—vehicles for law enforcement, medical supplies,
or office equipment. In fact, for most tribes even basic
banking services cannot be secured on the res’ -vation.
As a result, all Amici Tribes have found it necessary to
contract for financing, goods, or services with non-Indians
whose places of business lay outside Indian country. These
contracts include agreements with off-reservation entities
made under the authority of the Indian Self-Determination
and Education Assistance Act of 1975, 25 U.S.C. §§ 450
et seq.
In the negotiation of such contracts, all Amici Tribes
have discussed and agreed upon terms regarding remedies
denced in part by comparison of mortality rates. During the period
1990-1992, the age adjusted mortality rate for all races nationwide
was 513.7 per 100,000 persons, while the rate among Indians was
1048.7 within the Aberdeen Area, and 896.2 within the Billings
Area. Id. at 45.
‘Library of Congress Congressional Research Service, Memo-
randum to the U.S. Senate Committee on Indian Affairs on Indian-
Related Federal Spending Trends, at CRS-11 (April 15, 1996).
4
in the event of breach. These have included waivers of
sovereign immunity that specifically define the scope of
the waiver—including the remedies available, the choice
of law, the forums in which the claim may be enforced,
and the property from which a judgment might be satis-
fied. Such waivers are expressly stated, knowingly made,
and the product of negotiation by the parties. As a result,
both parties to the contract enter into it with full knowl-
edge of their respective rights, remedies and risks.
All Amici Tribes have an interest in the rules govern-
ing tribal sovereign immunity, as their ability to carry
out their governmental responsibilities is directly affected
by the costs of defending against lawsuits in forums to
which they have not consented and the risk of being sub-
ject to liability that they had not anticipated and for
which they have no protection.
Amici Tribes file this brief to urge the Court to apply
this Court’s prior decisions that Indian tribes retain their
sovereign immunity from suit absent an express waiver
by the tribe or Congress, and that the state courts lack
jurisdiction over a tribe that has not waived its immunity.
STATEMENT OF THE CASE
The Oklahoma Court of Appeals affirmed a judgment
for damages entered against the Kiowa Tribe on a promis-
sory note in which the Tribe had expressly reserved its
sovereign rights. In so ruling, the Court recognized that
the Kiowa Tribe had “not waived its sovereign rights,”
but held that because aspects of the transaction occurred
outside Indian country * the state court had “jurisdiction
5 The note in a section titled “Waivers and Governing Law”
recited that “Nothing in this Note subjects or limits the sovereign
rights of the Kiowa Tribe of Oklahoma.” Ex. A to Petition on
Promissory Note, at 2, in Manufacturing Technologies, Inc. v.
Kiowa Tribe, No. CJ 93-6523 (District Court, Oklahoma County).
* While the opinion does not describe the facts on which the
Court based this conclusion, the note recites that it was executed
5
to hear a claim and enter a judgment for damages against”
the Tribe. Pet. App. at 2-4, Manufacturing Technologies,
inc. v. Kiowa Tribe of Oklahoma, No. 86,489 (Okla.
App. June 28, 1996).
The Court based its assumption of jurisdiction over
the Tribe on prior decisions of the Oklahoma Supreme
Court, Hoover v. Kiowa Tribe of Oklahoma, 909 P.2d
59 (Okla. 1995), cert. denied, 116 S.Ct. 1675 (1996),
and First National Bank in Altus v. Kiowa, Comanche,
and Apache Intertribal Land Use Committee, 913 P.2d
299 (Okla. 1996). The Court found that the making
of the promissory note constituted an off-reservation activ-
ity of the Tribe and held that the note was enforceable
against the Tribe in state court because the state’s law
allowed breach of contract actions to be asserted against
the state. Pet. App. at 3, 4. The Court further ruled
that state jurisdiction exists unless “expressly prohibited
by Congress,” and that the assertion of state jurisdiction
to enter a judgment of damages against an Indian tribe
“does not infringe on tribal self-government.” Pet. App.
at 3. Since then, the Oklahoma Supreme Court has re-
affirmed the rule stated in Hoover, and held that the
questions of tribal sovereign immunity and the state’s juris-
diction over Indian tribes are controlled by “state law.”
Aircraft Equipment Company v. Kiowa Tribe of Okla-
homa, 921 P.2d 359, 361, 362 (Okla. 1996).
SUMMARY OF ARGUMENT
The decision below is a radical departure from three
fundamental and well established principles of federal In-
dian law that this Court has never questioned: first, that
the existence of a tribe’s sovereign immunity is controlled
exclusively by federal law, Santa Clara Pueblo v. Martinez,
by the Tribe within Indian country at the Tribe’s offices in Car-
negie, Okln»homa, with payments to be made at the lender’s offices
outside of Indien country. Ex. A to Petition on Promissory Note
at 1.
6
436 U.S. 49, 58 (1978); second, that only an unequivocal
statement by Congress or the tribe is effective to waive
the tribe’s sovereign immunity from suit, id.; Puyallup
Tribe v. Washington Dep't of Game, 433 U.S. 165, 172-
73 (1977); and third, that state courts lack jurisdiction
over Indian tribes, Bryan v. Itasca County, 426 U.S. 373,
388-89 (1976).
The Oklahoma Court of Appeals turned each of these
bedrock principles of federal Indian law on its head, and
replaced them with an unprecedented test under which:
the state courts presumptively possess civil jurisdiction
over Indian tribes; the existence of a tribe’s immunity from
suit is a question of state—not federal—law; and the fed-
eral law rule requiring an express waiver of immunity is
supplanted by one under which even an express reserva-
tion of sovereign rights may be irrelevant to the existence
of the immunity. This test cannot be reconciled with
established federal law or the policies that federal law is
intended to effect.
If the decision were allowed to stand, the rule would
have devastating consequer._es for Indian tribes. A tribe’s
access to basic goods and services that are unavailable
within Indian country would be held hostage to the tribe’s
waiver of its sovereign immunity to suits in state court, a
result prohibited by this Court’s decision in Three Affili-
ated Tribes v. Wold Engineering, 476 U.S. 877 (1986).
Innumerable lawsuits would be initiated in state court
against Indian tribes simply upon an allegation that some
aspect of the transaction occurred outside Indian country.
Tribes, most of which have no choice but to keep tribal
funds in off-reservation banks, would be compelled to
appear and defend, and the purpose of the immunity—to
protect the sovereign from the burden of litigation to
which it has not consented—would be obviated. The cost
of defending against these actions would drain tribal
treasuries, divert tribal assets and resources from provid-
ing essential government services to Indian people, and
undermine the decades of federal law and policy that have
7
sought to promote tribal self-determination and economic
development. Moreover, all of these effects would be felt
directly on the reservations.
None of this is necessary. The problem presented by
this case is easily avoided by application of the existing
rules of federal law. Under these simple rules, persons
seeking to contract with Indian tribes may ensure that
they have enforceable remedies against the tribe by nego-
tiating for and obtaining an appropriate waiver of tribal
immunity in the text of the contract itself.
The decision of the Oklahoma Court of Appeals should
be reversed.
ARGUMENT
I. UNDER SETTLED RULES OF FEDERAL LAW,
TRIBES ARE IMMUNE FROM SUIT ABSENT AN
ACT OF CONGRESS OR THE TRIBE’S EXPRESS
WAIVER OF THAT IMMUNITY, AND STATES
LACK JURISDICTION OVER TRIBES THAT HAVE
NOT WAIVED THEIR IMMUNITY.
A. Tribal sovereign immunity, as an aspect of a tribe’s
inherent sovereignty, is protected by federal law
and may only be waived by Congress or the tribe.
Tribal sovereign immunity is defined and controlled by
federal law. See Oklahoma Tax Comm'n v. Graham, 489
U.S. 838, 841 (1989). As this Court has repeatedly made
clear, “Indian tribes have long been recognized as possess-
ing the common-law immunity from suit traditionally en-
joyed by sovereign powers.” Santa Clara Pueblo v.
Martinez, 436 U.S. 49, 58 (1978); Oklahoma Tax
Comm'n v. Citizen Band of Potawatomi Indian Tribe, 498
U.S. 505, 509-11 (1991); United States v. United States
Fidelity & Guaranty Co., 309 U.S. 506, 512 (1940);
Turner v. United States, 248 U.S. 354, 358 (1919). A
tribe’s sovereign immunity is an “aspect of tribal sover-
eignty,” Santa Clara Pueblo, 436 U.S. at 58, rooted in
the unique relationship between the United States and the
tribes. This immunity “is a necessary corollary to Indian
sovereignty and self-governance.” Three Affiliated Tribes
v. Wold Engineering, 476 U.S. 877, 890 (1986).
Because immunity is an aspect of a tribe’s sovereignty,
recognized by federal law, the power to limit or waive
that immunity is vested exclusively in Congress and the
tribe. Santa Clara Pueblo, 436 U.S. at 58-59; Puyallup
Tribe v. Washington Dep't of Game, 433 U.S. 165, 172-
73 (1977); Fidelity & Guaranty Co., 309 U.S. at 512.
The states have no power in this regard. To the contrary,
“in the absence of federal authorization, tribal immunity,
like all aspects of tribal sovereignty, is privileged from
diminution by the States.” Three Affiliated Tribes v. Wold
Engineering, 476 U.S. 877, 891 (1986). The “suability
of the United States and the Indian Nations . . . depends
upon affirmative statutory authority. Consent alone gives
jurisdiction to adjudge against a sovereign. Absent that
consent, the attempted exercise of judicial power is void.”
Fidelity & Guaranty Co., 309 U.S. at 514.
The lower court reached the opposite conclusion, and
decided that a tribe’s immunity from suit could be decided
by application of “state law” rather than federal law by
relying on other state court decisions that incorrectly ex-
tended the comity principles of Nevada v. Hall, 440 U.S.
410 (1979), to Indian tribes. Nevada v. Hall is inappli-
cable here. The question decided in Nevada v. Hall was
whether the Constitution required that the California
courts give effect to limits imposed by Nevada on its
waiver of sovereign immunity, for a tort action involving
a Nevada official brought in California by California resi-
dents arising out of a traffic accident occurring there.
The Court held that nothing in the text or framework
of the Constitution regarding the relationship between the
states required California to give effect to the Nevada
officials immunity. 440 U.S. at 418-27. Rather, based
9
on the plan of the Constitution and intent of the Framers,
the Court found that as between the states, questions
of whether to recognize the sovereign immunity of a
wi to tort claims" was a matter of
ty to be resolved by the states. Thus, California
could determine the the existence of the Nevada official's
immunity by application of California law.
The very constitutional framework that permitted the
Court, in Nevada v. Hall, to allow principles of comity
to control questions of sovereign immunity between the
States precludes application of those comity principles to
matters involving Indian tribes. Indian tribes “are not
States, and the differences in the form and nature of their
sovereignty makes it treacherous” to treat them as such.
White Mountain Apache Tribe v. Bracker, 448 U.S. 136,
143 (1980). Moreover, the relationship between states
and Indian tribes is defined by the Constitution, under
which the states relinquished, without limitation, all au-
thority over Indian affairs to the federal government. The
settled rule is that “(t]he Constitution vests the Federal
Government with exclusive authority over relations with
Indian tribes.” Montana v. Blackfeet Tribe, 471 U.S. 759,
764 (1985) (citing Oneida Indian Nation v. County of
Oneida, 414 U.S. 661, 670 (1974), and Worcester v.
Georgia, 31 U.S. (6 Pet.) 515, 561 (1832)); Bryan v.
Itasca County, 426 U.S. 373, 376 n.2 (1976); United
States v. Mazurie, 419 U.S. 544, 554 n.11 (1975);
Morton v. Mancari, 417 U.S. 535, 551-52 (1974); Board
of County Comm'rs v. Seber, 318 U.S. 705, 715-16
(1943). See also Seminole Tribe of Florida v. Florida,
517 US. , 134 L.BEd.2d 252, 276-77 (1996).
* The ruling is expressly limited to tort claims arising out of
traffic accidents. The Court noted “[wle have no occasion, in this
case, to consider whether different state policies, .. . might require
a different analysis or a different result.” Nevada v. Hall, 440 U.S.
at 424 n.24. This Court has not since expanded its holding beyond
that scope.
10
The importance of exclusive federal control over Indian
affairs became apparent from the time of the Articles of
Confederation. The Articles had imposed two limitations
on the power of Congress over Indian affairs—“the Indians
must not be members of any State, nor must Congress do
anything to violate or infringe the legislative right of a
State within its own limits.” United States v. Forty-Three
Gallons of Whiskey, 93 U.S. 188, 194 (1876); Art. 9
Journals of the Continental Congress, 1774-1 789, IX, at
919 (Lib. of Cong. ed. 1904-1937). But these limitations
led to disagreement. While the Continental Congress as-
serted exclusive power to deal with Indian tribes, a num-
ber of states disputed this view and independently dealt
with Indian tribes. Journals, supra, at XXXIII, at 455,
460.
To resolve further controversy, the limitations con-
tained in the Articles were omitted from the text of the
Constitution. See Forty-Three Gallons, 93 U.S. at 194;
see U.S. Const., Art. I, § 8, cl. 3. As this Court explained,
the Framers recognized that those limitations “rendered
the [federal] power of no practical value,” and that “the
only efficient way of dealing with the Indian Tribes was
to place them under the protection of the General Govern-
ment. Their peculiar habits and character required this
.. .” Forty-three Gallons, 93 U.S. at 194; accord, The
Federalist No. 42 at 284 (J. Cooke ed. 1961) (Madison,
explaining that the Indian Commerce Clause was “prop-
erly unfettered from the two limitations contained in the
articles of Confederation.”) Thus, by the Constitution,
“the whole power of regulating the intercourse with . . .
{the Indians] was vested in the United States,” Worcester
v. Georgia, 31 U.S. (6 Pet.) 515, 560 (1832), as there
could “be no divided authority” between the states and
the national government in Indian affairs. The Kansas
Indians, 72 U.S. (5 Wall.) 737, 755 (1867). Congress’
power to regulate commerce with Indians both within and
outside Indian country was to be exclusive. Forty-Three
Gallons, 93 U.S. at 194-95.
4
g
t
:
H
whether to recognize tribal sovereign immunity." This
Court’s analysis in Blatchford v. Native Village of Noatak,
501 U.S. 775 (1991), demonstrates that the comity prin-
ciples of Nevada v. Hall cannot apply to Indian tribes:
* For the same reason, the lower court erred in concluding that
the state court has inherent jurisdiction to adjudicate a claim
against an Indian tribe. Unlike the rules governing state jurisdic-
tion over individual Indians off-reservation, federal law bars state
court jurisdiction to adjudicate claims against an Indian tribe
unless Congress has expressly granted such jurisdiction. Bryan,
426 U.S. at 388-89. While Congress can confer such power on the
state courts, see Parker v. Richard, 250 U.S. 235, 239 (1919), it
has not done so for the claims raised here. And the specificity
with which Congress must speak is established by Bryan. Even
where Congress had provided that certain states “shall have juris-
diction over civil causes of action between Indians or to which
Indians are parties . . .,” the statute did not confer any “state
jurisdiction over the tribes themselves.” 426 U.S. at 388-89. The
absence of such statute here is fatal to the state court’s assertion
of jurisdiction over the tribe, and is all the more so without a
waiver of tribal sovereign immunity.
Oklahoma Tax Comm'n v. Graham, 489 U.S. 838 (1989), is not
to the contrary. The issue decided there was whether the com-
plaint filed in state court raised a federal question that would
permit removal of the action to federal court. This Court con-
cluded that it did not, but stated that the tribe’s immunity from
suit might provide a federal defense to the claims. /d. at 840-41.
In so ruling, however, this Court did not decide the merits of the
immunity defense, nor the state court’s jurisdiction over the
tribe. Rather, like this Court’s decisions in National Farmers
Union Ins. Co. v. Crow Tribe, 471 U.S. 845 (1985), and lowa
Mutual Ins. Co. v. LaPlante, 480 U.S. 9 (1987), Graham addressed
a matter of procedure under which the state courts, like tribal
courts, are allowed “initially to respond to an invocation of their
jurisdiction.” See Strate v. A-1 Contractors, 65 U.S.L.W. 4298.
4301 (U.S. April 28, 1997). But the decision to allow another
court to initially determine its own jurisdiction is not a ruling
on the ultimate question of that court’s “adjudicatory authority.”
See id.
12
What makes the States’ surrender of immunity from
suit by sister States plausible is the mutuality of that
concession. There is no such mutuality with...
Indian tribes. We have repeatedly held that Indian
tribes enjoy immunity against suits by States . . . as
it would be absurd to suggest that the tribes sur-
rendered immunity in a convention to which they
were not even parties.
Id. at 782 (citations omitted); Idaho v. Coeur d'Alene
Tribe, 65 U.S.L.W. 4540, 4542 (U.S. June 23, 1997).°
B. Waivers of tribal sovereign immunity cannot be
implied but must be unequivocally expressed.
Applying the same standard that governs waivers of
the United States’ sovereign immunity, and the States’
Eleventh Amendment immunity, this Court consistently
has held that a waiver of tribal immunity “ ‘cannot be
implied, but must be unequivocally expressed.’” Santa
Clara Pueblo, 436 U.S. at 58-59 (citing United States
v. Testan, 424 U.S. 392, 399 (1976), quoting United
States v. King, 395 U.S. 1, 4 (1969)); accord Dellmuth
v. Muth, 491 U.S. 223, 227-28 (1989). In the absence
of an express waiver of sovereign immunity by the tribe
or “ ‘congressional authorization,’ the ‘Indian Nations are
exempt from suit.’” Santa Clara Pueblo, 436 U.S. at 58
(quoting Fidelity & Guaranty Co., 309 U.S. at 512);
Puyallup Tribe, 433 U.S. at 172.
The requirement of an express waiver has been con-
sistently applied. It has never depended on the nature of
the activity underlying the claim. See Santa Clara Pueblo,
436 U.S. at 51-52 (civil rights); Turner, 248 U.S. at 357-
58 (torts); Fidelity & Guaranty Co., 309 U.S. at 510
* If the comity principles of Nevada v. Hall were deemed applica-
ble, and allowed states to apply state law to determine the existence
of a tribe’s sovereign immunity, then those same comity principles
would permit tribal courts to determine, as a matter of tribal law,
whether a state retains its immunity from suit on like claims pre-
sented in tribal court.
governmen
Potawatomi, 498 U.S. at 510, whether the claim is
brought by a tribal member, Santa Clara, or a non-Indian,
Fidelity, or a state, Potawatomi, and whether it is asserted
in federal, Santa Clara, or state court. Puyallup Tribe,
433 U.S. at 172-73.
Nor has a tribe’s sovereign immunity turned on the
place where the transaction giving rise to the claim might
be said to have occurred or its effects felt. To the contrary,
this Court has applied the same fundamental principles
and upheld tribal sovereign immunity from suits arising
from tribal activities occurring outside the tribe's reserva-
tion, to the same extent as those arising within reservation
boundaries. Puyallup Tribe, 433 U.S. at 172-73. The
lower federal courts have done the same. Indeed, in con-
tract actions such as this, the courts have resolved ques-
tions regarding tribal immunity by determining whether
an act of the tribe or Congress expressly waived that
immunity—not by undertaking to discern whether the
situs of the contract is on- or off-reservation.” And the
federal courts that have specifically addressed the ques-
tion of a tribe’s sovereign immunity to a suit arising from
a commercial transaction occuring outside the reserva-
% See, e.g., Rosebud Sioux v. Val-U Const. Co., 50 F.3d 560, 568
(8th Cir. 1995), cert. denied, 116 S.Ct. 78 (1997); Altheimer &
Gray v. Sioux Mfg. Corp., 983 F.2d 803, 812 (7th Cir.), cert. denied,
510 U.S. 1019 (1993); McClendon v. United States, 885 F.2d 627,
629-30 (9th Cir. 1989); American Indian Agricultural Credit Con-
sortium, Inc. v. Standing Rock Sioux Tribe, 780 F.2d 1374, 1376-77
(8th Cir. 1985); Bottomly v. Passamaquoddy Tribe, 599 F.2d 1061,
1064, 1066 (1st Cir. 1979); Maryland Casualty Co. v. Citizens Na-
tional Bank of West Hollywood, 361 F.2d 517, 521-22 (5th Cir.),
cert. denied, 385 U.S. 918 (1966); Thebo v. Choctaw Tribe, 66
F. 372, 375-76 (8th Cir. 1895) ; Adams v. Murphy, 165 F. 304, 311-
12 (8th Cir. 1908).
14
tion have concluded that immunity exists absent express
tribal waiver.”
Congress is certainly “at liberty to dispense with such
tribal immunity or to limit it” and has, in fact, authorized
various classes of suits against Indian tribes.” But in so
doing, Congress has been very careful to define the precise
circumstances under which tribes may be sued, balancing
the importance of immunity to the tribe’s ability to carry
out its governmental functions, against the need to accord
a remedy to individuals who may be adversely affected by
the exercise of those functions.“ As a result, congres-
11 See Sac & Fox Nation v. Hanson, 47 F.3d 1061, 1064-65 (10th
Cir.), cert. denied, 116 S.Ct. 57 (1995) ; Green v. Mt. Adams Furni-
ture, 980 F.2d 590, 598 (9th Cir. 1992), cert. denied, 510 U.S. 1039
(1994); Frederico v. Capital Gaming Int'l Inc., 888 F. Supp. 354
(D.R.I. 1995); Elliott v. Capital Investment Bank, 870 F.Supp.
733 (E.D. Tex. 1994), aff'd, 102 F.3d 549 (5th Cir. 1996). See
also Maynard v. Naragansett Indian Tribe, 984 F.2d 14 (1st Cir.
1993) (tribal sovereign immunity applies to actions arising within
as well as without Indian country and barred a direct action against
the tribe claiming trespass on lands outside of the reservation
boundaries); Haile v. Sawnooke, 246 F.2d 293 (4th Cir. 1957)
(tribe did not lose its immunity by accepting a charter issued by
the state). ;
2 See Potawatomi, 498 U.S. at 510. Congress has authorized
certain claims to be brought by tribal members and others against
the tribe, e.g., Appropriations Act of March 3, 1905, c. 1479, §1,
883 Stat. 1048, 1071; see The Cherokee Intermarriage Cases, 203
U.S. 76 (1908); Green v. Menominee Tribe, 233 U.S. 558 (1914),
and between different tribal groups. Act of July 22, 1958, Pub. L.
No. 85-547, 72 Stat. 408; see Healing v. Jones, 210 F.Supp. 125
(D. Ariz. 1962), aff'd, 373 U.S. 758 (1963); Appropriations Act
of March 3, 1883, c. 141, 22 Stat. 581, 585; The Cherokee Trust
Funds, 117 U.S. 288 (1886). Congress has also authorized tribes
to be joined in suits for adjudication of water rights. Act of July
10, 1952, c. 651, Title II, § 208(a)-(c), 66 Stat. 560, codified at 43
U.S.C. § 666; see Arizona v. San Carlos Apache Tribe, 463 U.S. 545
(1983).
8 These factors were equally relevant to Congress’ decision on
whether to establish a federal cause of action to enforce the rights
15
sional waivers of tribal immunity have been limited in
number and narrowly tailored, with deference otherwise
given to the tribe to make decisions on when and how
to waive its immunity. See Santa Clara Pueblo, 436 U.S.
at 58-72.
C. Congress has not waived tribal immunity, and no
such waiver can be implied without undermining
tribal sovereignty and federal law and policy for
tribal self-determination and economic development.
Congress has not chosen to abrogate tribal immunity
for the kind of claim raised here. To the contrary, Con-
gress has “consistently reiterated its approval of the im-
munity doctrine,” Potawatomi, 498 U.S. at 510, in terms
that do not permit the existence of a tribe’s immunity to
created by the Indian Civil Rights Act, 25 U.S.C. §§ 1301-1303.
Considering the potential disruption that federal suits might have
on the tribal government's ability to carry out its functions, Con-
gress chose to limit the federal court remedies under the Act to
habeas corpus, and otherwise deferred to the tribes to make appro-
priate decisions regarding the remedies to be provided in tribal
forums. Santa Clara Pueblo, 436 U.S. at 58-72.
For example, in the Indian Reorganization Act of 1984, 25
U.S.C. §§ 461 et seq., Congress authorized tribes to adopt charters
for the express purposes of engaging in business enterprises. 25
U.S.C. § 477. Some of those business charters include “sue and
be sued” clauses waiving the entity’s immunity from suit, although
those charters may also expressly limit the assets from which a
judgment may be satisfied. See Maryland Casualty Co. v. Citizens
Nat'l Bank of West Hollywood, 361 F.2d 517, 521-22 (5th Cir.),
cert. denied, 385 U.S. 918 (1966). More recently, in the Indian
Self-Determination Act of 1975, Congress effected a limited waiver
of tribal sovereign immunity by requiring the maintenance of in-
surance in connection with work done under the act, and further
directing that the insurance policy prohibit the insurer from
asserting the tribe’s immunity as a defense to a claim covered by
the policy. 25 U.S.C. § 450f(c) (3) (A). In addition, some federal
agencies have required waivers of tribal sovereign immunity as
a condition of participation in the program. See Weeks Const. Co.
v. Oglala Sioux Housing Auth., 797 F.2d 668, 671 n.2 (8th Cir.
1986) (Department of Housing and Urban Development).
16
turn on whether aspects of a transaction might be said
to have occurred within or outside Indian country.
Significantly, Congress reaffirmed tribal sovereign im-
munity in the Indian Self-Determination and Education
Assistance Act of 1975, 25 U.S.C. §§ 450, 450n(/),”
which is one among many federal statutes intended to
promote “ ‘Indian self-government, including its “over-
riding goal” of encouraging tribal self-sufficienty and eco-
nomic development.’” Potawatomi, 498 U.S. at 510
(quoting California v. Cabazon Band of Mission Indians,
480 U.S. 202, 216 (1987)); New Mexico v. Mescalero
Apache Tribe, 462 U.S. 324, 334-35, & n.17 (1983).
Moreover, as reflected by the federal statutes enacted to
carry out these policies, Congress has understood that
tribal self-determination and economic development cannot
be accomplished exclusively within Indian country.” In-
15 The Self-Determination Act recites that “[njothing in this
Act shall be construed as .. . affecting, modifying, diminishing, or
otherwise impairing the sovereign immunity from suit enjoyed by
an Indian tribe.” 25 U.S.C. § 450n(1). Tribal sovereign immunity
was more recently affirmed by Congress in the American Indian
Agricultural Resource Management Act of 1993, 25 U.S.C. § 3746.
1% Congress has historically recognized that Indian commerce
is not and cannot be confined to the reservation boundaries. This
is illustrated by the federal Indian trader statutes, 25 U.S.C. §§ 261-
264, and their application to nonresident vendors, see Central Ma-
chinery Co. v. Arizona Tax Comm'n, 448 U.S. 160, 165 (1980). It
is also illustrated by the Non-Intercourse Act, 25 U.S.C. § 177, and
the federal statutes regulating liquor trade with Indians both
within and outside Indian country, see Dick v. United States, 208
U.S. 340 (1908) ; United States v. Forty-Three Gallons of Whiskey,
93 U.S. 188, 194 (1876). It is further reflected by the treaties
reserving Indian rights to hunt and fish outside the reservation
boundaries, Antoine v. Washington, 420 U.S. 194 (1975), the
exercise of which is regulated and managed by the tribes outside
the reservation. See, e.g., Settler v. Lameer, 507 F.2d 231, 237-38
(9th Cir. 1974); United States v. Washington, 520 F.2d 676, 686
(9th Cir. 1975), cert. denied, 423 U.S. 1086 (1976); Lac Courte
Oreilles Band v. Wisconsin, 668 F.Supp. 1233, 1241-42 (W.D.Wis.
1987); United States v. Michigan, 471 F.Supp. 192, 273 (W.D.
Mich. 1979).
17
deed, many provisions of these statutes contemplate that
the tribe provide services, operate programs and engage
in enterprises both within and outside the reservation
boundaries. For example, the Indian Financing Act, 25
U.S.C. § 1521, provides federal grants to tribes and indi-
vidual Indians “to establish and expand profit making
Indian owned enterprises on or near reservations.” The
Indian Child Welfare Act, 25 U.S.C. §§ 1931-1933, au-
thorizes federal grants for the establishment and operation
of Indian child and family service programs both on
and off reservation. And by the Indian Health Care Im-
provement Act, 25 U.S.C. §§ 1601, 1603(c), (m), tribes
are to provide health care services to all Indians living
on or near the reservation, within a federally defined
service area. Consistent with these statutes, and the
reality that the contracts made by tribes under authority
of the Self-Determination Act will often involve parties
and activities outside the boundaries of the reservation,
Congress reaffirmed tribal sovereign immunity without
geographic limitation.”
Sovereign immunity, and the right to decide when and
how to waive that immunity, are critical components of
tribal self-determination and economic development. The
principle of sovereign immunity recognizes that no gov-
ernment can fulfill its obligations to its citizenry while
also defending itself against any and all litigants in a
judicial forum. Sovereign immunity—for any government
"7 While reaffirming tribal sovereign immunity, Congress also
provided remedies for claims that might be made against tribal
employees or contractors carrying out the Self-Determination Act
contracts. Specifically, Congress extended the Federal Tort Claims
Act to cover such claims. The FTCA is available to the same extent
as it applies to the United States—without regard to whether the
claimed wrong occurred within or outside the reservation. Act of
November 5, 1990, Pub. L. No. 101-512, Title III, § 314, 104 Stat.
1959, as amended by Act of November 11, 1993, Pub. L. No. 108-
138, Title III, § 308, 107 Stat. 1416, reprinted following 25 U.S.C.S.
§ 450f (1995).
18
—protects government resources necessary for public serv-
ices from loss through litigation. Such threats, while
applicable to all sovereigns, have been held to be espe-
cially severe for Indian tribes whose limited resources and
considerable unmet needs make them all the more vulner-
able to the impact of lawsuits to which they have not con-
sented nor planned. Thebo v. Choctaw Tribe, 66 F. 372,
375-76 (8th Cir. 1895); Fidelity & Guaranty Co., 309
U.S. at 512-13; Chemehuevi Tribe v. California State
Board of Equalization, 757 F.2d 1047, 1051 (9th Cir.),
rev'd on other grounds, 474 U.S. 9 (1985). See also
Santa Clara Pueblo, 436 U.S. at 64-65 & n.19, 67. The
embedded conditions of poverty confronting Indian tribes **
can only be remedied by a dedicated long term commit-
ment to their eradication. This cannot be done if tribes
are subject to unlimited demands by litigants, and cer-
tainly not if they are denied the right to make their own
decisions on when and how to waive their immunity—
rights possessed by the federal and state governments with
parallel responsibilities and much greater resources.
18 These problems persist. As recently found by Congress, “the
unmet health needs of the American Indian people are severe” with
the health status of Indians “far below that of the general popula-
tion of the United States ....” Indian Health Care Improvements
Act of 1976, as amended in 1992, 25 U.S.C. § 1601(d). The same
is true in the areas of Indian education and employment. Consider-
ing data on school drop-out rates and levels of educational! attain-
ment, Congress found that Indian people continue to confront
serious problems in education, many of which are tied to “the high
incidence of poverty, unemployment, and health problems among
Indian children and their families.” Improving America’s Schools
Act of 1994, 20 U.S.C §§ 7801(4), (5), 7802(a); see also Indian
Employment, Training and Related Services Demonstration Act
of 1992, 25 U.S.C. §3401. Congress has also recently found “the
need for affordable homes in safe and healthy environments on
Indian reservations, [and] in Indian communities” is “acute.”
Native American Housing Assistance and Self-Determination Act
of 1996, Pub. L. No. 104-330, § 2(6), 110 Stat. 4018.
19
Il. FEDERAL LAW DOES NOT PERMIT THE LOWER
COURT'S TEST UNDER WHICH THE EXISTENCE
OF A TRIBE’S SOVEREIGN IMMUNITY TURNS
ON WHETHER SOME ASPECT OF THE TRANS-
ACTION OCCURS ON OR OFF RESERVATION.
A. A damages action against a tribe is per se an action
against the tribe on the reservation.
The operation of a tribal government cannot survive
the uncertainty of a rule that would make a tribe’s im-
munity from suit turn on whether the transaction may
have occurred within or outside Indian country.” A dam-
ages action brought against a tribe that has not consented
to suit has a direct and immediate effect on the reser-
This Court’s decision in Mescalero Apache Tribe v. Jones, 411
U.S. 145 (1973), does not support the off-reservation distinction
that the Court below made. In relying on that decision the Court
below confused the rules regarding the applicability of substantive
law to a tribe’s off-reservation activities with the rules that control
governmental immunity. The two are different. The availability of
a sovereign’s immunity from suit does not turn on whether the
sovereign’s actions were proper under substantive law. See Mitchell
v. Forsyth, 472 U.S. 511, 526 (1985); Puerto Rico Aqueduct v.
Metcalf & Eddy, 506 U.S. 139, 145-46 (1993). Immunity is not a
defense on the merits, but the right of a sovereign not to be sub-
jected “‘to the coercive process of judicial tribunals at the in-
stance of private parties.’” Seminole Tribe of Florida, 517 U.S.
at ——, 134 L.Ed. 2d at 268 (quoting Puerto Rico Aqueduct, 506
U.S. at 146). The difference between the applicability of state sub-
stantive law to tribal activities occurring off-reservation and a
tribe’s sovereign immunity from suit is illustrated by this Court’s
decisions in Citizen Band of Potawatomi and Santa Clara Pueblo.
Although the Court in Potawatomi found that the tribe was legally
obligated to collect state excise taxes from its non-Indian purchasers,
498 U.S. at 512-13, the tribe’s sovereign immunity from suit barred
the state from asserting a counterclaim against the tribe to recover
the tax. /d. at 509-10. The same distinction was recognized in
Santa Clara Pueblo, where the Indian Civil Rights Act changed the
substantive law applicable to Indian tribes, 436 U.S. at 57-58, but
the statute did not implicitly abrogate the tribe’s immunity from
suit. Jd. at 58-59.
20
vation and the tribe’s sovereign functions. The threat
to tribal sovereignty is the same whether the contract
is deemed to be on- or off-reservation. This is clearly
illustrated by the facts in related proceedings in this case
where, at the behest of a private party, a judgment entered
on a note given to an off-reservation lender has been
enforced by the seizure of tribal assets off-reservation,
including tribal tax revenues due from lessees of reserva-
tion property, with the tribe enjoined from enforcing its
tax laws to foreclose on tax liens created by failure to pay
the tax.” While the underlying claim involved a trans-
action denominated as off-reservation, its effects on the
tribe’s governmental resources and sovereignty make it
the “functional equivalent” of a suit against the tribe on
the reservation. See Idaho v. Coeur d'Alene Tribe, 65
U.S.L.W. 4540, 4546 (U.S. June 23, 1997); id. at 4548
(O’Connor, J., concurring). The practical effects of the
unconsented-to litigation require that the sovereign’s im-
munity be upheld to protect the sovereign interests. See id.
B. The lower Court’s test would obvi«'te the protections
intended by immunity and impermissibly condition
the tribe’s access to off-reservation resources on a
waiver of its immunity.
If the question of a tribe’s sovereign immunity is to
be decided by the state courts under the approach used
by the courts in Oklahoma, the threat to tribal self-
determination and economic self-sufficiency presented is
all the more severe. Under that test, a tribe can be haled
into state court by any person simply upon an allegation
that some aspect of a contractual relation with the tribe
is commercial and occurred outside of Indian country.
As the states’ laws governing the situs of contracts and
business transactions do not lend themselves to a single
set of rules that are uniformly applied with any pre-
2° See Pet. App. at 8, 10, Kiowa Indian Tribe of Oklahoma v.
Hoover, Civ. 98-843-C (W.D.Okla. Nov. 1996).
21
dictable result,” any event occurring outside Indian
country may be alleged as a basis for abrogating tribal
immunity and subjecting the tribe to suit in state court.
Whether or not there is merit to the allegation, the tribe
will be compelled to appear and defend. If it does not
do so, the tribe faces default judgment, followed by the
likely threat of attachment of tribal funds, which for many
tribes are necessarily held in banks outside the reservation.
The result will be a proliferation of state court actions
against Indian tribes in which even an express reservation
of tribal sovereign immunity, as in this case, may be irrele-
vant to the analysis. And by engrafting state law rules
governing situs of contracts onto a test for determining
tribal immunity, the very purposes of that immunity—the
sovereign’s right to avoid the costs and burden of litiga-
tion—will be effectively and irrevocably lost. Mitchell v.
Forsyth, 472 U.S. 511, 526 (1985). The cost of defend-
ing these actions will “impose serious financial burdens
on already ‘financially disadvantaged’ tribes,” burdens that
21 The situs of a contract for purposes of jurisdiction and choice
of law principles can turn on a variety of often competing factors,
the balancing of which is left to the discretion of the court. For
example, in a suit to recover on a promissory note made in connec-
tion with a purchase of securities, the situs of the claim can be
affected by: the express terms of the contract, the place where it
was executed, the place of payment, the location of the security
interest, whether the agreement constituted a negotiable or non-
negotiable instrument, and whether another sovereign has greater
ties to the transaction. See Restatement (Second) of Conflict of
Laws, §§ 6, 188, 195 (1971); Goodrich & Scoles, Conflict of Laws,
319-20 (4th ed. 1964). The outcome of the analysis may also turn
on the cause of action pled, with differing conclusions if the suit
is one to recover on the collateral, as opposed to a claim against
the debtor for a judgment in damages. See Restatement (Second)
of Conflict of Laws, §§ 56, 61, 66, 67, 68 (1971). The issues are
further complicated by the need to decide whether the tribal activ-
ity at issue is commercial or governmental in nature—distinctions
which, as this Court has found in other contexts, are “inherently
unsound” and lead to “inevitable chaos.” Indian Towing Co. v,
United States, 350 U.S. 61, 65 (1955).
22
many tribes can “ill afford to shoulder,” Santa Clara
Pueblo, 436 U.S. at 64-65 & n.19, and which will most
certainly divert limited tribal resources from funding
schools and hospitals to paying legal fees.
Moreover, the lower Court’s test would accomplish what
was clearly prohibited by this Court’s decision in Three
Affiliated Tribes v. Wold Engineering, 476 U.S. 877,
890 (1986). The state will be able to condition a tribe’s
ability to obtain financing, goods, and services that are not
available from any source within Indian country on a
waiver of the tribe’s sovereign immunity from suit and sub-
mission to rules of state law. When North Dakota at-
tempted to do this by a state statute that conditioned the
tribe’s access to the state courts on a waiver of the tribe’s
sovereign immunity for all civil actions brought in the
state courts and on which state civil law would control,
this Court held the statute barred by federal law. As the
Court found, the state’s condition could be “met only at
an unacceptably high price to tribal sovereignty,” id. at
889, which was “unduly intrusive of the Tribe’s common
law sovereign immunity,” and “a potentially severe im-
pairment of the authority of the tribal government, its
tribal courts and its laws.” /d. at 891. The same is true
here. A tribe’s access to essential goods and services
cannot be conditioned on a rule of law that coerces a
waiver of the tribe’s immunity as the price for acquiring
those goods.
Ill. THE EXISTING FEDERAL RULES GOVERNING
TRIBAL IMMUNITY PROVIDE CLEAR STAND-
ARDS UNDER WHICH PERSONS SEEKING TO
DO BUSINESS WITH INDIAN TRIBES CAN
SECURE ENFORCEABLE REMEDIES.
There is no need for a radical change in the test gov-
erning tribal sovereign immunity with regard to contracts
that might be said to have off-reservation attributes or
effects. To the contrary, contracts are the vehicle best
23
suited to give effect to established federal law rules for
waiver of tribal immunity.
“*Tribes and persons dealing with them long have
known how to waive sovereign immunity when they so
wish.”” McClendon v. United States, 885 F.2d 627, 631
(9th Cir. 1989) (quoting American Indian Agricultural
Credit Consortium, Inc. v. Standing Rock Sioux Tribe,
780 F.2d 1374, 1379 (8th Cir. 1985)). One who seeks
to do business with an Indian tribe can negotiate the
terms on which that will be done, including the terms
governing remedies for breach. See Sac & Fox Nation
v. Hanson, 47 F.3d at 1065. Provision for a waiver of
sovereign immunity can be made in the text of the con-
tract. Whether to include such provision as well as its
scope lie wholly within the control of the contracting
parties to be resolved in the context of negotiation. In
the event that the tribe is unwilling to agree upon terms
for such remedies, the other party is free to refuse to do
business with the tribe. Remedies, including waivers of
tribal immunity, do exist, have been agreed upon by the
tribes, and enforced by the courts.” In this case, of course,
22 See, e.g., Sokaogon Gaming Enterprises v. Tushie Montgomery
Assoc., 86 F.3d 656 (7th Cir. 1996) (waiver of immunity to enforce
contract's arbitration clause); Rosebud Siour v. Val-U Const. Co.,
50 F.3d 560, 562-63 (8th Cir. 1995), cert. denied, 116 S.Ct. 78
(1997) (waiver of immunity contained in contract with off-
reservation construction company; Altheimer & Gray v. Sioux Mfg.
Corp., 983 F.2d 803, 812 (7th Cir. 1998), cert. denied, 510 U.S.
1019 (1995) (express waiver of immunity from suit contained in
tribal corporation’s charter, and confirmed in the contracts under
which the suit was brought); Weeks Const. Co. v. Oglala Sioux
Housing Auth., 797 F.2d 668, 671 (8th Cir. 1986) (waiver of
immunity in charter of tribal housing authority); Merrion v.
Jicarilla Apache Tribe, 617 F.2d 587, 540 (10th Cir. 1980), aff'd
on other grounds, 455 U.S. 130 (1982) (tribal council adopted
resolution waiving immunity from suit); Maryland Casualty Co.
v. Citizens National Bank of West Hollywood, 361 F.2d 517, 521-22
(5th Cir.), cert. denied, 385 U.S. 918 (1966) (waiver of immunity
in tribal corporation’s charter but limiting the remedies available
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This is a copy of a public record, reproduced as it was published. It is not legal advice, and it may not be the version a court would rely on. Check the official source before you cite it.