# 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, 1996
>

KIOWA TRIBE OF OKLAHOMA,

Petitioner,

V.

MANUFACTURING TECHNOLOGIES, INC.,

Respondent.
.

On Writ Of Certiorari
To The Oklahoma Court Of Appeals
.

BRIEF OF FIRST NATIONAL BANK OF ALTUS AND
RAYMOND L. FRIEDLOB, RECEIVER FOR ALPINE
MUTUAL FUND TRUST AS AMICI CURIAE
IN SUPPORT OF RESPONDENT

.

Steven W. Bucc, OBA #1299 RicHarp H. Govpserc,
(Counsel of Record) CO #6365
McAree & Tart Frieptop SANDERSON RasKIN
A Professional Corporation PAULSON &
10th Floor Tourtittott, LLC
Two Leadership Square 1400 Glenarm Place,
211 North Robinson 3rd _ Floor
Oklahoma City, Oklahoma Denver, Colorado 80202

73102-7103 Phone: 303/571-1400
Phone: 405/235-9621 Fax: 303/615-5472

Fax: 405/255-0699 Counsel for Raymond L.
Counsel for First National Friedlob, receiver for

Bank in Altus and Raymond Alpine Mutual Fund Trust
L. Friedlob, receiver for

Alpine Mutual Fund Trust

September 26, 1997

—— ——————————————————_———_———————————EEE

COCKLE LAW BRIEF PRINTING CO., (800) 225-6964
OR CALL COLLECT (402) 342-2831

TABLE OF CONTENTS
Page

INTERESTS OF AMICI CURIAE SUPPORTING
MANUFACTURING TECHNOLOGIES, INC

ARGUMENT AND AUTHORITIES

I. TRIBAL SOVEREIGN IMMUNITY DOES NO!
EXTEND TO ACTIVITIES CONDUCTED BY A
TRIBE OUTSIDE OF ITS TERRITORIAL JURIS-
DICTION .

PRACTICAL CONSIDERATIONS DICTATE
THAT INDIAN TRIBES BE TREATED IN THE
SAME MANNER AS ALL OTHER GOVERN-
MENTS WITH RESPECT TO SOVEREIGN
IMMUNITY

A. Waiver of Sovereign Immunity is Not a Via-
ble Solution

Failure to Extend Sovereign Immunity
Beyond Indian Country Will Not Impair
Tribal Activities or Frustrate Congressional
Policies ...

CONCLUSION

TABLE OF AUTHORITIES

Page
Cases
Aircraft Equipment Company v. Kiowa Tribe of Okla-
homa, 921 P.2d 359 (Okla. 1996)...............0000: 9
Blatchford v. Native Village of Noatak, 501 U.S. 775,
111 S.Ct. 2578, 115 L.Ed.2d 686 (1991) ............. 5
First National Bank in Altus v. Kiowa, Comanche and
Apache Intertribal Land Use Committee, 913 P.2d
209 (Olde. NODE)... 6. .0csccevcccdinccee 1
Hilton v. Guyot, 159 U.S. 113, 16 S.Ct. 139, 40 L.Ed.
DS (RBGSD ow ccvevecssvcsesspe 6deeaweeeenanneee 16
Idaho v. Coeur d'Alene Tribe of Idaho, 521 U.S. __,
117 S.Ct. 2028, 138 L.Ea.2d 438 (1997) .......... 5, 13
lowa Mutual Insurance Company v. LaPlante, 480
U.S. 9, 107 S.Ct. 971, 94 L.Ed.2d 10 (1987)........ 16
Merrion v. Jicarilla Apache Tribe, 445 U.S. 130, 102
S.Ce. P46, 71 1.0.28 Zl (ISG. . onckccscctncvcnees 16
Mescalero Apache Tribe v. Jones, 411 U.S. 145, 93
S.Ct. 1267, 36 L.Ed.2d 114 (1973)............... 10, 11
Nevada v. Hall, 440 U.S. 410, 99 S.Ct. 1182, 59
ces SEG CIGPUD. » . 0 +.0ss6deccunne eee passim

Oklahoma Tax Commission v. Citizen Band
Potawatomie Indian Tribe of Oklahoma, 498 U.S.
505, 111 S.Ct. 905, 112 L.Ed.2d 1112 (1991)..... 11, 12

Organized Village of Kake v. Egan, 369 U.S. 60, 82
DEX. S68, 7 LABDS SIS GHP. cs vc cvacuusi essa 10

TABLE OF AUTHORITIES ~— Continued

Page
Puyallup Tribe, Inc. v. Washington Department of
Game, 433 U.S. 165, 97 S.Ct. 2616, 53 L.Ed.2d 667
th Nomtidedenseanesshesevteescceseees 11, 12
Santa Clara Pueblo v. Martinez, 436 U.S. 49, 98 S.Ct.
1670, 56 L.Ed.2d 106 (1978).....................5, 15
Telex Corporation v. Hamilton, 576 P.2d 767 (Okla.
cei seek ee bedebe + dvsctcdvccsescees 17
The Schooner Exchange v. M'Faddon, 7 Cranch 116, 3
irr b UC te dccedetesevsecacececceces 6,7
United States v. Mazurie, 419 U.S. 544, 95 S.Ct. 710,
Sick tae Wseescdbessecccces 16
United States v. United States Fidelity & Guaranty
Company, 309 U.S. 506, 60 S.Ct. 653, 84 L.Ed. 894
TE SUGESGs bcdcbeusdebesescotesesesvesece 14
Verlinden B.V. v. Central Bank of Nigeria, 461 U.S.
480, 103 S.Ct. 1962, 76 L.Ed.2d 81 (1983)........... 7
Williams v. Shearson Lehman Brothers, Inc., 917 P.2d
EE nb die dkdbse0e'escbeececceses 17

INTERESTS OF AMICI CURIAE SUPPORTING
MANUFACTURING TECHNOLOGIES, INC.',2

First National Bank in Altus (the “Altus Bank”) is the
plaintiff in First National Bank in Altus v. Kiowa, Comanche
and Apache Intertribal Land Use Committee, 913 P.2d 299
(Okla. 1996), which is one of the cases relied upon by the
Oklahoma Court of Appeals in rendering its decision in
this case. In 1990 and 1991, the Altus Bank made loans to
the Kiowa, Comanche and Apache Intertribal Land Use
Committee (“KCA”) to own and operate a dress making
facility in Altus, Oklahoma. The dress making facility was
located on leased land that was not Indian country. The
promissory notes were executed at the Altus Bank, which
was also not Indian country, and provided for payment at
the Bank. The only relationship which this commercial
transaction had with an Indian tribe was that KCA was
the owner of the facility and the entity that borrowed the
money

After the Oklahoma Supreme Court's decision, KCA
commenced an action in the United States District Court
tor the Western District of Oklahoma entitled Kiowa,
Comanche and Apache Intertribal Land Use Committee v.
District Court of Jackson County, No. CIV-96-1003-L. In that
action, KCA sought an injunction against the district

' Pursuant to Rule 37.6, Rules of the Supreme Court,
counsel for amici curiae states that no counsel for any party
authored this brief in whole or in part, and that no person or
entity other than the amici and their counsel made any monetary
contribution to the preparation and submission of this brief

* The parties have consented to the filing of this brief
amicus curiae. Letters of consent have been filed with the Clerk
of this Court.

court and the district judge prohibiting them from pro-
ceeding with the state court litigation. In seeking the
injunction, KCA claimed sovereign immunity. The federal
district court dismissed the action for lack of jurisdiction.
The action is currently pending on a motion for rehear-

ing.

Upon remand from the Oklahoma Supreme Court,
the Altus Bank pursued the claim in state court and has
obtained a judgment against KCA of approximately
$850,000. This Court's decision in the present case may
affect the validity or collectibility of the Altus Bank’s
judgment.

Raymond L. Friedlob has been appointed by the
United States District Court for the District of Colorado
to act as receiver for Alpine Mutual Fund Trust
(“Alpine”), a Massachusetts business trust consisting of
two series mutual funds, including California Municipal
Asset Trust (“CMAT”). Alpine was registered with the
Securities and Exchange Commission (the “SEC”) as an
open-end investment company. In 1991, after an investi-
gation by the SEC, the SEC requested that the federal
court in Colorado appoint a receiver. As part of his
duties, Friedlob is responsible for collecting and liquidat-
ing the assets of CMAT and protecting the interests of its
shareholders. The shareholders in CMAT consist of
approximately 750 individuals, many of whom are
retired.

CMAT was engaged primarily in the business of
making equipment leases, including leases with Indian
tribes. In these transactions, CMAT would typically loan
money for the acquisition of machinery and equipment

for a business to be operated by the tribe. The contracts
were often negotiated and executed outside of Indian
country. CMAT typically required the tribe to provide an
opinion of its counsel that the agreement was valid, bind-
ing and enforceable in accordance with its terms.

Friedlob is currently in the process of attempting to
collect in excess of $1,500,000 which is owed by the
Comanche Tribe of Oklahoma and the Kiowa Tribe of
Oklahoma. In each case, Friedlob commenced litigation in
state court in Oklahoma. Despite the opinions of counsel,
both tribes have raised the defense of sovereign immu-
nity. The trial courts have denied the defense of sovereign
immunity and the actions are still pending.

In addition to asserting the defense of tribal immu-
nity in the state court action, the Comanche Tribe com-
menced a separate action in federal court seeking to
enjoin the district judge and the district court from pro-
ceeding with the state court litigation. The Comanche
Tribe asserted that the action should not proceed because
of its claim of sovereign immunity. That action was dis-
missed by the federal court for lack of jurisdiction and is
now pending on appeal before the Tenth Circuit Court of
Appeals as Comanche Indian Tribe v. District Court of Grady
County, No. 97-6194.

Friedlob has a direct interest in the outcome of the
present case because if the decision of the Oklahoma
courts is reversed and the Kiowa Tribe is found to be
protected by sovereign immunity, the efforts by Friedlob
to liquidate the claims against the Comanche Tribe and
the Kiowa Tribe will be affected.

4

ARGUMENT AND AUTHORITIES

I. TRIBAL SOVEREIGN IMMUNITY DOES NOT
EXTEND TO ACTIVITIES CONDUCTED BY A
TRIBE OUTSIDE OF ITS TERRITORIAL JURIS-
DICTION.

Petitioner, Kiowa Indian Tribe (the “Kiowa Tribe”)
and their supporting amici curiae urge the Court to extend
tribal sovereign immunity to activities which tribes con-
duct outside of their territorial jurisdiction. The Kiowa
Tribe and the supporting tribes seek the protection of
sovereign immunity for any activity which they may
conduct anywhere in the United States. No government,
whether state, federal or foreign, enjoys the protection
which the tribes seek to obtain in the present action.
Contrary to the position asserted by the Kiowa Tribe and
the supporting tribes, the absolute sovereign immunity
enjoyed by any government is limited to activity which
that government conducts within its own territorial juris-
diction. When a government goes beyond its own juris-
dictional boundaries and engages in activity within
another jurisdiction, the sovereignty of the host jurisdic-
tion is necessarily implicated. Nevada v. Hall, 440 U.S. 410,
416, 99 S.Ct. 1182, 59 L.Ed.2d 416, 422 (1979). The host
government, in the exercise of its own sovereignty, has
the right to determine whether to recognize the sovereign
immunity as a matter of grace and comity.

To determine whether an Indian tribe is protected by
sovereign immunity when it engages in commercial activ-
ities outside of its jurisdictional boundaries, the Court
must consider the characteristics of tribal sovereign

immunity and the nature and history of sovereign immu-
nity between nations. The nature of tribal sovereign
immunity was described in Santa Clara Pueblo v. Martinez,
436 U.S. 49, 58, 98 S.Ct. 1670, 56 L.Ed.2d 106, 115 (1978):

Indian tribes have long been recognized as
possessing the common-law immunity from suit
traditionally enjoyed by sovereign powers.

The comparison of tribal sovereignty to foreign sover-
eignty was reiterated in Blatchford v. Native Village of
Noatak, 501 U.S. 775, 782, 111 S.Ct. 2578, 115 L.Ed.2d 686,
696 (1991) where this Court stated:

Respondents argue that Indian tribes are
more like States than foreign sovereigns. That is
true in some respects: They are, for example,
domestic. The relevant difference between States
and foreign sovereigns, however, is not domes-
ticity, but the role of each in the convention
within which the surrender of immunity was for
the former, but not for the latter, implicit. What
makes the State’s surrender of immunity from
suit by sister States plausible is the mutuality of
that concession. There is no such mutuality with
either foreign sovereigns or Indian tribes.

Finally, in this Court’s most recent pronouncement.
Indian tribes were again compared with foreign powers
with respect to their sovereign immunity. In Idaho v. Coeur
d'Alene Tribe of Idaho, 521 U.S. __, 117 S.Ct. 2028, 138
L.Ed.2d 438, 447 (1997) the Court reaffirmed its finding in
Blatchford, supra, by stating:

Indian tribes, we therefore concluded, should be
accorded the same status as foreign sovereigns,
against whom States enjoy Eleventh Amend-
ment immunity.

Indian tribes, like all other sovereigns, enjoy absolute
immunity from suit for activities which occur within their
territorial jurisdiction. The State of Oklahoma has not
sought to subject the Kiowa Tribe to suit in Oklahoma
courts for activities which occurred within Indian country
subject to Kiowa jurisdiction. Rather, the present dispute
involves commercial activity by the Kiowa Tribe within
the State of Oklahoma and outside of Indian country. In
such circumstances where one foreign sovereign has vol-
untarily engaged in activity within the jurisdiction of
another sovereign, the determination of whether the for-
eign sovereign’s claim of sovereign immunity will be
recognized is one for the host sovereign to make based
upon its own laws and grace and comity. This issue was
first addressed by this Court in The Schooner Exchange v.
M’Faddon, 7 Cranch 116, 136, 3 L.Ed. 287, 293 (1812)
where Chief Justice Marshall stated:

The jurisdiction of courts is a branch of that
which is possessed by the nation as an indepen-
dent sovereign power.

The jurisdiction of the nation within its own
territory is necessarily exclusive and absolute. It
is susceptible of no limitation not imposed by
itself. Any restriction upon it, deriving validity
from an external source, would imply a diminu-
tion of its sovereignty to the extent of the
restriction, and an investment of that sover-
eignty to the same extent in that power which
could impose such restriction.

All exceptions, therefore, to the full and
complete power of a nation within its own terri-
tories, must be traced up to the consent of the

nation itself. They can flow from no other legiti-
mate source.

Since the decision in The Schooner Exchange, this
Court has continued to recognize that, in the absence of a
treaty or other agreement, the determination of whether
the sovereign immunity of a foreign government will be
recognized must be based upon the laws of the host
jurisdiction as a matter of grace and comity. In Verlinden
B.V. v. Central Bank of Nigeria, 461 U.S. 480, 486, 103 S.Ct.
1962, 76 L.Ed.2d 81, 87 (1983) (emphasis added) this rule
was reiterated:

As The Schooner Exchange made clear,
however, foreign sovereign immunity is a matter of
grace and comity on the part of the United States,
and not a restriction imposed by the Constitu-
tion.

Because Indian tribes possess the same common-law
immunity from suit traditionally enjoyed by sovereign
powers, this case is controlled by the Court's decision in
Nevada v. Hall, 440 U.S. 410, 99 S.Ct. 1182, 59 L.Ed.2d 416
(1979). In that action, a Nevada employee was involved in
a car wreck within the State of California. In response to
the tort action filed in California state court, Nevada
claimed sovereign immunity. California, which had
waived sovereign immunity for itself, did not recognize
Nevada’s claim of immunity. In considering Nevada's
claim of immunity from suit in California’s courts for
activity which occurred within California, this Court
noted:

The doctrine of sovereign immunity is an
amalgam of two quite different concepts, one
applicable to suits in the sovereign’s own courts

and the other to suits in the courts of another
sovereign.

This explanation adequately supports the
conclusion that no sovereign may be sued in its
own courts without its consent, but it affords no
support for a claim of immunity in another sov-
ereign’s courts. Such a claim necessarily impli-
cates the power and authority of a second
sovereign; its source must be found either in an
agreement, express or implied, between the two
sovereigns, or in the voluntary decision of the
second to respect the dignity of the first as a
matter of comity.

{Ijf California and Nevada were independent
and completely sovereign nations, Nevada's
claim of immunity from suit in California’s
courts would be answered by reference to the
law of California.

440 U.S. at 414, 416-417, 59 L.Ed.2d at 421-423. The Court
then considered and rejected Nevada's claim that the
Constitution imposed restrictions on California's right to
choose whether or not to recognize Nevada's claim of
immunity for activity occurring in California. The restric-
tions in the Constitution relied upon by Nevada did not
abrogate the individual States’ status as independent sov-
ereigns:

Collectively they demonstrate that ours is not a

union of 50 wholly independent sovereigns. But

these provisions do not imply that any one State's

immunity from suit in the courts of another State is
anything other than a matter of comity.

440 U.S. at 425, 59 L.Ed.2d at 428 (emphasis added).

Because Indian tribes are treated as foreign nations
for sovereign immunity purposes and because States
have the right to decide as a matter of comity whether to
recognize the claim of sovereign immunity, Oklahoma
was entitled to make this decision in the exercise of its
own sovereignty. Just as California had the right to
decide whether to recognize Nevada's claim for immu-
nity in Nevada v. Hall, supra, Oklahoma has the right to
decide whether to recognize the claim of immunity by the
Kiowa Tribe.

In the present action, the Kiowa Tribe has voluntarily
engaged in commercial activity within the State of Okla-
homa. If the claim of sovereign immunity is upheld,
Respondent, Manufacturing Technologies, will have no
remedy for the breach of contract. Such a result is con-
trary to the public policy of Oklahoma. Oklahoma
requires all governments, state, county and municipal, to
fulfill their contractual obligations or be liable in dam-
ages. Oklahoma is merely holding the Kiowa Tribe to the
same standard. This public policy was expressly
announced by the Oklahoma Supreme Court in Aircraft
Equipment Company v. Kiowa Tribe of Oklahoma, 921 P.2d
359, 362 (Okla. 1996):

Behind this reasoning are important public pol-
icy considerations. Our contract law protects
parties to contracts from arbitrariness that
would otherwise control if parties were free to
disregard any contract clauses that a disadvan-
taged party believed would be enforced to its
detriment. Contracts are effective when parties
know that the provisions of the contract will be
enforced in our district courts. Such a policy
protects all of our citizens including the tribes

10

who voluntarily choose to do business with
their fellow Oklahoma citizens. If it were other-
wise, the tribes would have difficulty finding
anyone willing to risk his funds in unenforce-
able obligations. Such a rule would chill tribal
commercial and entrepreneurial business.

The result that Indian tribes are not protected by
sovereign immunity when they engage in activities out-
side of their territorial boundaries is merely a recognition
of existing law. Not only is that holding compelled by
Nevada v. Hall, supra, but the result is consistent with
other Supreme Court precedent that Indian tribes are
subject to state regulation for activities occurring outside
of Indian country. This Court has consistently held that
tribal activities occurring outside of a tribe's territorial
jurisdiction are subject to state regulation. In Mescalero
Apache Tribe v. Jones, 411 U.S. 145, 148-149, 93 S.Ct. 1267,
36 L.Ed.2d 114, 119 (1973), this Court held:

But tribal activities conducted outside the
reservation present different considerations.
‘State authority over Indians is yet more exten-
sive over activities . . . not on any reservation.’
Organized Village of Kake, supra, at 75, 7 L.Ed.2d
573. Absent express federal law to the contrary,
Indians going beyond reservation boundaries
have generally been held subject to non-
discriminatory state law otherwise applicable to
all citizens of the State.

See Organized Village of Kake v. Egan, 369 U.S. 60, 82 S.Ct.
562, 7 L.Ed.2d 573 (1962).

The Kiowa Tribe, the United States, and the other
amici curiae urge the Court to reach a different result
arguing that exclusive federal authority over Indian

11

tribes is vested with the United States. The Kiowa Tribe
urges that such authority arises from the Indian com-
merce clause of the Constitution. That result was
expressly rejected in Mescalero Apache Tribe v. Jones, supra,
411 U.S. at 147-148, 36 L.Ed.2d at 119 where this Court
stated:

At the outset, we reject - as did the state
court - the broad assertion that the Federal Gov-
ernment has exclusive jurisdiction over the Tribe
for all purposes and that the State is therefore
prohibited from enforcing its revenue laws
against any tribal enterprise ‘[w]hether the
enterprise is located on or off tribal land.’ Gen-
eralizations on this subject have become partic-
ularly treacherous. . . . The upshot has been the
repeated statements of this Court to the effect
that even on reservations state laws may be
applied unless such application would interfere
with reservation self-government or would
impair a right granted or reserved by federal
law.

Finally, the United States suggests that this Court has
previously held that tribes were protected by sovereign
immunity in state court, even for activity occurring out-
side the reservation boundaries. In making this assertion,
the United States relies upon Puyallup Tribe, Inc. v. Wash-
ington Department of Game, 433 U.S. 165, 97 S.Ct. 2616, 53
L.Ed.2d 667 (1977) and Oklahoma Tax Commission v. Citizen
Band Potawatomie Indian Tribe of Oklahoma, 498 U.S. 505,
111 S.Ct. 905, 112 L.Ed.2d 1112 (1991). However, the issue
of jurisdiction over activities occurring off the reservation
was not at issue in either case. In the Puyallup Tribe case,
the issue, as framed by the tribe was:

12

The Tribe, supported by the United States as
amicus curiae, contends in this Court that the
doctrine of sovereign immunity requires that the
judgment be vacated, and that the state courts of
Washington are without jurisdiction to regulate
fishing activities on its reservation.

433 U.S. at 167, 53 L.Ed.2d at 671 (emphasis added).
Likewise, in the Oklahoma Tax Commission case, the issue
was also clearly framed to be limited to activities on the
reservation:

Finally, Oklahoma asserts that even if sover-
eign immunity applies to direct actions against
tribes arising from activities on the reservation,
that immunity should not apply to the facts of
this case.

498 U.S. at 511, 112 L.Ed.2d at 1121 (emphasis added). In
fact, the exact opposite conclusion must be drawn from
the Oklahoma Tax Commission case. As Justice Stevens
noted in his concurring opinion, the Court impliedly held
that tribes were not entitled to absolute immunity in state
courts, when he stated: “My purpose in writing sep-
arately is to emphasize that the Court’s holding in effect
rejects the argument that this governmental entity — the
Tribe - is completely immune from legal process.” 498
U.S. at 515-516, 112 L.Ed.2d at 1124.

Because the determination of whether a sovereign
government must recognize the claim of immunity by a
foreign government conducting activity outside of that
government's territorial jurisdiction has always been a
matter of grace and comity for the host sovereign, Okla-
homa is free to determine based upon its own laws and as
a matter of comity, whether and to what extent it will

_ _ a ——a

oOo

13

recognize the sovereign immunity of the Kiowa Tribe for
the activities occurring outside of Indian country. To deny
Oklahoma the right to make this decision is to impinge
upon Oklahoma's sovereignty. Nevada v. Hall, supra, 440
U.S. at 416, 59 L.Ed.2d at 422. Oklahoma has the right and
authority to make such a determination with respect to
any foreign nation, and Indian tribes are accorded the
same status as foreign sovereigns for sovereign immunity
purposes. Idaho v. Coeur d'Alene Tribe of Idaho, supra, 138
L.Ed.2d at 447. Oklahoma's decision not to recognize
tribal sovereign immunity in this case must be upheld.

Il. PRACTICAL CONSIDERATIONS DICTATE THAT
INDIAN TRIBES BE TREATED IN THE SAME
MANNER AS ALL OTHER GOVERNMENTS
WITH RESPECT TO SOVEREIGN IMMUNITY.

If the Kiowa Tribe prevails in this action, the Kiowa
Tribe and other Indian tribes will gain a status unique
among all governmental entities, whether state, munici-
pal, or foreign. If Oklahoma is denied the right to decide
for itself whether to recognize the claim of sovereign
immunity for activity occurring outside of Indian country
but within the State of Oklahoma, Indian tribes will be
free to unilaterally decide whether and how to fulfill
contractual obligations. No other government enjoys such
status. Indian tribes would be free to engage in commerce
throughout the United States knowing that they will
never be required to fulfill their contractual obligations.
The other party to the contract will have no remedy in
any court, state or federal. It is precisely this type of
abuse that the Oklahoma Supreme Court was seeking to
avoid.

14

Several of the amici curiae have suggested that it is
unnecessary to provide non-Indian parties to a contract
with a forum for resolution of disputes and enforcement
of obligations because such parties are sophisticated busi-
nessmen capable of protecting their interests by other
means. Even if true with respect to Manufacturing Tech-
nologies, the Altus Bank, and others, such a statement is a
gross generalization which would certainly not be true
with respect to many business situations. Many busi-
nesses have never had dealings with Indian tribes in their
governmental capacity and would not be aware of the
special rules applicable to Indian tribes.

A. Waiver of Sovereign Immunity is Not a Viable
Solution.

Several of the amici curiae have suggested that a
simple waiver of sovereign immunity would be adequate
to protect the non-Indian. Waiver of sovereign immunity
does not provide a viable solution to this issue. First, it is
not entirely clear if or how Indian tribes may waive
sovereign immunity. In United States v. United States Fidel-
ity & Guaranty Company, 309 U.S. 506, 513, 60 S.Ct. 653, 84
L.Ed. 894, 899 (1940) the Court stated:

It is a corollary to immunity from suit on the
part of the United States and the Indian Nations
in tutelage that this immunity cannot be waived
by officials.

Assuming that an official can waive sovereign immunity
for a tribe if properly authorized, a contracting party
must determine whether tribal law authorizes a waiver,
what steps are required to grant a waiver, and what

i5

officials are authorized to act. A contracting party would
have to review all tribal governmental documents to
ensure that a waiver was validly obtained.

The second hurdle for a waiver of sovereign immu-
nity is the waiver language itself. In Santa Clara Pueblo v.
Martinez, supra, 436 U.S. at 58, 56 L.Ed.2d at 115, the

_ Court stated:

It is settled that a waiver of sovereign
immunity “cannot be implied but must be
unequivocally expressed.”

Because waivers are strictly construed in favor of Indian
tribes, the language must be carefully drafted to cover
not only the transaction in question but also any remedies
which may be availa’ e. If in hindsight, a court deter-
mines that the waiver language is not broad enough to
cover a particular situation, the injured party will be left
without a remedy. Given these difficulties in obtaining a
valid waiver of sovereign immunity that was properly
worded to cover the transaction, only the largest and
most important transactions would warrant the icgal
expense required. Obtaining a waiver of sovereign immu-
nity is not a viable solution when transacting business
with an Indian tribe.

B. Failure to Extend Sovereign Immunity Beyond
Indian Country Will Not Impair Tribal Activ-
ities or Frustrate Congressional Policies.

The Kiowa Tribe suggests that failure to extend sov-
ereign immunity to activities which they conduct off the
reservation will impair their ability to conduct tribal gov-
ernment and will hinder Congress’ policy of promoting

16

tribal self-sufficiency. The Kiowa Tribe asserts that
because it has a limited land base, it will be difficult for it
to engage in commercial activity.

The Kiowa Tribe as well as other Indian tribes have
an opportunity to completely protect themselves from
unauthorized suits, whether in state or federal court.
Such tribes need only restrict their activities to lands
within their jurisdiction. It is undisputed that Indian
tribes are protected by sovereign immunity for activities
occurring within their jurisdiction.

Restricting activity to a tribe's territorial jurisdiction
in order to maintain the benefits of sovereign immunity is
consistent with the rights and powers of Indian tribes
generally. Like all governments, a tribe is limited by its
territorial jurisdiction. As this Court noted in Hilton v.
Guyot, 159 U.S. 113, 163, 16 S.Ct. 139, 40 L.Ed. 95, 108
(1895):

No law has any effect, of its own force,

beyond the limits of the sovereignty from which
its authority is derived.

The jurisdiction of an Indian tribe is similar to that of
any other government. An Indian tribe only has jurisdic-
tion over its members and its territory. United States v.
Mazurie, 419 U.S. 544, 557, 95 S.Ct. 710, 42 L.Ed.2d 706,
716 (1975); lowa Mutual Insurance Company v. LaPlante, 480
U.S. 9, 14, 107 S.Ct. 971, 94 L.Ed.2d 10, 18 (1987).

This Court has consistently recognized this territorial
limitation on the power of an Indian tribe. In Merrion v.
Jicarilla Apache Tribe, 445 U.S. 130, 141-42, 102 S.Ct. 894,
904, 71 L.Ed.2d 21, 32 (1982) (emphasis added), the Court
described this territorial limitation as follows:

17

[A] tribe has the power to tax nonmembers only
to the extent the nonmember enjoys the privi-
lege of trade or other activity on the reservation
to which the tribe can attach a tax. This limita-
tion on tribal taxing authority exists not because
the tribe has the power to exclude nonmembers,
but because the limited authority that a tribe
may exercise over nonmembers does not arise
until the nonmember enters the tribal jurisdic-
tion. We do not question that there is a significant
territorial component to tribal power: a tribe has no
authority over a nonmember until the nonmem-
ber enters tribal lands or conducts business with
the tribe.

The territorial limitation is an inherent aspect of
tribal government. The fact that a tribe’s land base may
be limited does not justify providing special treatment.
The land base in Oklahoma is small in comparison to the
State of Texas, but Oklahoma does not receive special
treatment.

Finally, if a tribe is concerned that its activities out-
side of Indian country will subject it to jurisdiction, the
tribe has an available remedy. It may merely negotiate
with the other party to the contract an appropriate choice
of law and choice of forum clause designating tribal law
and tribal forums as controlling. Choice of law and choice
of forum clauses are enforced in Oklahoma. See Telex
Corporation v. Hamilton, 576 P.2d 767 (Okla. 1978); Williams
v. Shearson Lehman Brothers, Inc., 917 P.2d 998 (Okla. App.
1996). This approach has the special advantage of ensur-
ing that the other party to the contract is aware of the
special laws applicable to Indian tribes. When faced with
the request for a choice of law or choice of forum clause,

18

a party must inquire as to why such clauses are desired
and what effect they will have on the contract.

Recognizing and enforcing the territorial restriction
on the powers of Indian tribes will not impair tribal
activities. Tribes will be free to engage in whatever activ-
ities they desire under whatever rules they may enact
within their own territorial jurisdiction. However, when
tribes choose to engage in activities outside of their terri-
torial jurisdiction, the State where the activity occurs
must be allowed to determine whether it will recognize a
claim of sovereign immunity or provide its citizens with a
forum and remedy for breach of contract.

°

CONCLUSION

Indian tribes possess the common-law immunity
from suit traditionally enjoyed by sovereign powers. With
respect to a tribe’s own territory, that immunity is abso-
lute. However, when a tribe, like any other sovereign,
engages in activity beyond its territorial jurisdiction, sov-
ereign immunity is not absolute. Rather, the sovereignty
of the State in which the activity occurs is affected. The
State, in the exercise of its sovereignty, has the right to
choose whether it will recognize the claim of sovereign
immunity as a matter of comity.

In the present case, Oklahoma has chosen to treat the
Kiowa Tribe in the same manner as any other government
and to provide a remedy and forum to its citizens for
breaches of contract within the State. Nevada v. Hall,
supra, controls this litigation and mandates that Okla-
homa has the right to make that determination. This

ee ee

19

Court should affirm the decision of the Oklahoma Court
of Appeals.

Respectfully submitted,

Steven W. Bucc, OBA #1299

(Counsel of Record)

McAree & Tart

A Professional Corporation

10th Floor

Two Leadership Square

211 North Robinson

Oklahoma City, Oklahoma
73102-7103

Phone: 405/235-9621

Fax: 405/235-0439

Counsel for First National Bank
in Altus and Raymond L. Friedlob,

receiver for Alpine Mutual Fund
Trust

and

RicHarp H. Gorpserc, CO #6365

FrigDLOB SANDERSON RASKIN
Pautson & Tourtittorr, LLC

1400 Glenarm Place, 3rd Floor

Denver, Colorado 80202

Phone: 303/571-1400

Fax: 303/615-5472

Counsel for Raymond L. Friedlob,

receiver for Alpine Mutual Fund
Trust

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Source: Frix Law Library, https://www.frixlaw.com/law-library/documents/brief%3Amicro_IA40385014_0046%3A19. Public record. Not legal advice.