Amicus Curiae Brief — Wash. State Dep't of Licensing v. Cougar Den, Inc., 138 S. Ct. 294 (2017) (No. 16-1498)

No. 16-1498

In the Supreme Court of the United States

WASHINGTON STATE DEPARTMENT OF LICENSING,

STITIONER

v.

XOUGAR DEN, INC.

ON WRIT OF CERTIORARI TO THE

WASHINGTON SUPREME COURT

BRIEF FOR THE UNITED STATES

AS AMICUS CURIAE SUPPORTING PETITIONER

NOEL J. FRANCISCO

Solicitor General

Counsel of Record

JEFFREY H. Woop

Acting Assistant Attorney

General

EDWIN S. KNEEDLER

Deputy Solicitor General

ANN O’CONNELL

Assistant to the Solicitor

General

ELIZABETH ANN PETERSON

RACHEL HERON

(202) 514-2217

QUESTION PRESENTED

Article III of the Treaty of June 9, 1855, between the

United States and the Yakama Nation of Indians,

12 Stat. 952-953, secures to the Yakamas the “right, in

common with citizens of the United States, to travel

upon all public highways.” The question presented is:

Whether Article III precludes application to Yakama

tribal members of a tax imposed by the State of Wash-

ington on fuel purchased out-of-state and imported into

Washington, as part of a comprehensive state scheme

that also imposes the tax on fuel removed from an in-

state terminal or refinery.

(1)

TABLE OF CONTENTS

Page

Interest of the United States 1

Statement 1

Summary of argument 10

Argument:

Article III of the 1855 Treaty does not exempt

respondent from paying Washington's motor-fuel tax ...... 12

A. Article III of the 1855 Treaty secures the right of

the Tribe and its members to free access from the

Reservation to public highways and to travel upon

the public highways 13

B. Washington’s motor-fuel tax does not infringe on

tribal members’ right to travel upon the public

highways

C. The Washington Supreme Court erred in holding

that Article III of the 1855 Treaty exempts

respondent from paying Washington’s motor-fuel

tax

22

Conelusion 32

TABLE OF AUTHORITIES

Cases:

Antoine v. Washington, 420 U.S. 194 (1975)... 13

Choctaw Nation v. Oklahoma, 397 U.S. G20 (1970) ....... 7,14

Choctaw Nation of Indians v. United States,

318 U.S. 423 (1943) 14

Cree v. Flores, 157 F 3d 762 (9th Cir.

1998) 8, 16, 24, 25, 26, 30

Davis v. Michigan Dep't of the Treasury,

A 18

PDA v. Brown & Williamson Tobacco Corp.,

8 Ee 18, 22

(iI})

IV

Cases—Continued: Page

Interstate Transit, Inc. v. Lindsey, 233 U.S. 183

(1981) 19

King Mountain Tobacco Co. v. McKenna,

768 F.3d 989 (2014), cert. denied, 135 S. Ct. 1542

(2015) 8, 15, 16, 17, 31

Mescalero Apache Tribe v. Jones, 411 U.S. 145 (1973) ..... 13

Minnesota v. Mille Lacs Band of Chippewa Indians,

US. 172 (1999) 14, 16, 27

Moe v. Confederated Salish & Kootenai Tribes of the

Flathead Reservation, 425 US. 463 (1976) 4

Okdahoma Taz Comm'n v. Chickasaw Nation,

515 U.S. 450 (1995) 4, 14, 20, 21

Puyallup Tribe v. Department of Game, 391 US. 392

(1968) 13

Ramsey v. United States, 302 ¥ 3d 1074

(9th Cir. 2002), cert. denied, 540 U.S. 812 (2008)............. 28

Robinson v. Shell Oil Co., 519 U.S. 337 (1997) ................... 22

South Carolina v. Catawba Indian Tribe, Inc.,

476 U.S. 498 (1986) 17

Squaxin Island Tribe v. Stephens, 400 F . Supp. 2d

1250 (W.D. Wash. 2005) 4, 20

Tulee v. Washington, 315 U.S. 681 (1942) 2,14

United States v. Smiskin, 487 F 3d 1260

(9th Cir. 2007) 8, 24, 26, 27, 30

United States v. Winans, 198 U.S. 371 (19065).................... 14

Utility Air Reg. Grp. v. EPA, 134 8. Ct. 2427 (2014) ........22

Wagnon v. Prairie Band Potawatomi Nation,

546 U.S. 95 (2005) 5, 13, 21

Washington v. Tribes of the Colville

ion, 447 US. 134 (1980) 27

Washington v. Washington State Commercial

Passenger Fishing Vessel Ass'n, 443 U.S. 658

(1979) 13, 16, 29

Cases—Continued: Page

Yakama Indian Nation v. Flores, 955 F . Supp. 1229

(E.D. Wash. 1997), aff'd sub nom. Cree v. Flores,

157 F 3d 762 (9th Cir. 1998) 2, 16, 17, 25, 27, 29

Treaties and statutes:

Treaty of June 9, 1855, between the United States

and the Yakama Nation of Indians, art. III,

12 Stat. 952:

art. ITI, 12 Stat. 952-953 passim

art. III, 12 Stat. 953. 29

Treaty of June 11, 1855, between the United States

and the Nez Percé Indians, art. III,

12 Stat. 958 2

Treaty of July 16, 1855, between the United States

and the Flathead, Kootenay, and Upper Pend

d@Oreilles Indians, art. III, 12 Stat. 976 2

Contraband Cigarette Trafficking Act,

18 U.S.C. 2342(a) 26

Wash. Rev. Code Ann.:

(West 2012):

§ 82.36.0103) 3

§ 82.36.010(4) 3

§ 82.36.010(10) 3

3

5

§ 82.36.010(12)

§ 82.36.010(16)

§ 82.36.020 3,4

§ 82.36.020(1)

§ 82.36.020(2\a)(b)

§ 82.36.0202\a){c) 3, 19, 23

§ 82.36.020(2\c)

§ 82.36.022 5, 21, 30

§ 82.36.025 19

Statutes—Continued: Page

§ 82.36.080(1)(d) 3

(West 2008):

§ 82.38.020(4) 3

§ 82.38.020(5) 3

§ 82.38.020(12) 3

§ 82.38.0830 3, 4,19

§ 82.38.030(7)

§ 82.38.080(7)\(a)b) 3

§ 82.38.0380(7Ka)c) 3, 19

§ 82.38.030(7)(c) 3

§ 82.38.0381 5, 21, 30

§ 82.38.090(1)(d) 3

In the Supreme Court of the Anited States

No. 16-1498

WASHINGTON STATE DEPARTMENT OF LICENSING,

PETITIONER

Vv.

COUGAR DEN, INC.

ON WRIT OF CERTIORARI TO THE

WASHINGTON SUPREME COURT

BRIEF FOR THE UNITED STATES

AS AMICUS CURIAE SUPPORTING PETITIONER

INTEREST OF THE UNITED STATES

At issue in this case is the scope of a right guaranteed

to the Yakama Indian Nation by a treaty entered into

between the Yakamas and the United States. The

United States has an interest in the proper interpreta-

tion of treaties between the federal government and In-

dian tribes, in light of both the United States’ own in-

terests as a party to such treaties and its special rela-

tionship with the Indian signatories whose rights are

secured under such treaties. At the Court’s invitation,

the United States filed an amicus brief at the petition

stage of this case.

STATEMENT

1. In the mid-nineteenth century, the United States

entered into a series of treaties with Indian tribes in

(1)

2

what is now the State of Washington. Tulee v. Wash-

ington, 315 U.S. 681, 682-683 (1942). A group of Indians

now known as the Yakama Indian Nation (the Tribe)

agreed in one of those treaties to cede vast tracts of land

within that territory to the United States, reserving for

itself a much smaller reservation. /bid. One of the

United States’ major aims in entering into the treaty

was to enable the construction of public highways

and railroads in the region, including through the

Tribe’s reservation. Yakama Indian Nation v. Flores,

955 F. Supp. 1229, 1240-1241 (E.D. Wash. 1997), aff’d

sub nom. Cree v. Flores, 157 F.3d 762 (9th Cir. 1998).

To secure from the Tribe the concession that roads

could be built through the reservation, the United States

made certain representations regarding the Tribe’s ac-

cess to and use of public roads. Specifically, Article II!

of the Treaty provides:

[1}f necessary for the public convenience, roads may

be run through the said reservation; and on the other

hand, the right of way, with free access from the

same to the nearest public highway, is secured to

them; as also the right, in common with citizens of

the United States, to travel upon all public highways.

Treaty of June 9, 1855, between the United States and

the Yakama Nation of Indians (1855 Treaty), art. III,

12 Stat. 952-953.'

' The United States has entered into treaties with tribes in Idaho

and Montana that contain identically worded right-to-travel provi-

sions. See Treaty of June 11, 1855, between the United States and

the Nez Percé Indians, art. III, 12 Stat. 958; Treaty of July 16, 1855,

between the United States and the Flathead, Kootenay, and Upper

Pend d’Oreilles Indians, art. III, 12 Stat. 976.

3

2. a. The Washington state law at issue in this case

requires suppliers, exporters, blenders, distributors,

and (as relevant here) importers of motor-vehicle fuel

to obtai> a license and imposes a per-gallon motor-

fuel tax on “licensees.” Wash. Rev. Code Ann.

§§ 82.36.010(12), 82.36.020, 82.36.080(1)(d) (West 2012),

82.38.020(12), 82.38.030, 82.38.090(1)(d) (West 2008).”

The tax applies both to fuel originating in the State (for

example, when a tanker truck is filled with fuel from a

refinery or bulk storage facility) and to fuel brought

into the State after being removed from a refinery or

bulk storage facility outside of Washington. For fuel

removed from an in-state refinery or terminal, the State

imposes the tax at the time of removal (with certain ex-

ceptions not relevant here). /d. §§ 82.36.020(2)(a)(b) (West

2012), 82.38.030(7)(a){b) (West 2008). For fuel that

“enters into” Washington from another State, the tax is

imposed upon entry. /d. §§ 82.36.020(2)(c) (West 2012),

82.38.030(7)(c) (West 2008).* Those who bring fuel into

the State via a public highway must pay the same per-

gallon tax as those who bring fuel into the State’s stream

* Citations are to the 2008 and 2912 Revised Code of Washington

Annotated, which was in effect when the relevant conduct took

place. The State has recodified the cited provisions without sub-

stantive change. See Pet. Br. 7 n.2.

* The tax does not apply immediately to fuel imported into the

State by pipeline or vessel operated by a “licensee” and bound for a

“terminal” or “refinery.” Pet. App. 18a (Fairhurst, C.J., dissenting)

(citing Wash. Rev. Code Ann. §§ 8&2.36.010(3), (4), (10), and

82.36.020(2)(c) (West 2012); id §$§ 82.38.020(4), (5), (12), and

&2.38.030(7)(c) (West 2008)). The tax is triggered when fuel first

brought in by one of those methods is later removed from the in-

state terminal or refinery. Wash. Rev. Code Ann. §§ 82.36.020(2)(a)-

(c) (West 2012), 82.38.030(7)(a)(c) (West 2008).

4

of commerce through other means. /d. §§ 82.36.020 (West

2012), 82.38.0830 (West 2008).

b. The state motor-fuel tax currently in effect is not

the first version of such a tax that the Washington Leg-

islature has adopted. Before the current tax was en-

acted, a federal district court had determined that a

previous version of the tax placed the incidence of the

tax on fuel retailers (ie., gas stations). See Squazin /s-

land Tribe v. Stephens, 400 F. Supp. 2d 1250, 1262

(W.D. Wash. 2005). That court had therefore held that

the previous fuel-tax regime, as it pertained to Indian

retailers operating on Indian lands, ran afoul of the rule

that States generally may not tax Indian activities in In-

dian country absent congressional authorization. /d. at

1261-1262; see Oklahoma Tax Comm’n v. Chickasaw

Nation, 515 U.S. 450, 458-459 (1995); Moe v. Confeder-

ated Salish & Kootenai Tribes of the Flathead Reserva-

tion, 425 U.S. 463, 475-480 (1976).

Following that adverse judgment, the Washington

Legislature crafted the current fuel tax, following guid-

ance from this Court. In Chickasaw Nation, the Court

held that a State could not apply its motor-fuel tax to

fuel sold by a tribe to non-Indians in Indian country

where the incidence of the tax was on the tribe (as a fuel

retailer), but it noted that “if a State is unable to enforce

a tax because the legal incidence of the impost is on In-

dians or Indian tribes, the State generally is free

to amend its law to shift the tax’s legal incidence.”

515 U.S. at 460. The Washington Legislature accord-

ingly moved the incidence of its motor-fuel tax up the

supply chain. With respect to fuel ultimately sold on an

Indian reservation, the effect of that change is to im-

pose the tax before the fuel arrives on the reservation.

See Pet. Br. 6-7. The Washington Legislature’s intent

5

and purpose, as set forth in the statute, is to impose a

per-gallon tax on motor fuel “at the time and place of

the first taxable event and upon the first taxable person

within thie] state.” Wash. Rev. Code Ann. §§ 82.36.022

(West 2012), 82.38.031 (West 2008).

Putting to one side any effect the Yakama Treaty

might have here, such a tax is lawful as applied to fuel

to be delivered to Indian country. See Wagnon v. Prai-

rie Band Potawatomi Nation, 546 U.S. 95, 99, 115

(2005) (holding that Chickasaw Nation’s bar on impos-

ing a state excise tax on a tribe or tribal members for

sales in Indian country did not apply to a state tax im-

posed on the off-reservation receipt of fuel by a non-

Indian distributor who subsequently delivered the fue!

to a tribally owned gas station on the reservation).

3. Respondent Cougar Den, Inc., is a business incor-

porated under Yakama Nation law. Its owner and pres-

ident is an enrolled member of the Tribe. Pet. App. 2a.

Beginning in 2013, respondent used public highways to

transport fuel from Oregon to the Tribe’s Reservation

in Washington. /bid. Respondent contracted with a

trucking company, KAG West, to have the fuel trans-

ported over the Oregon-Washington border. bid.‘ Re-

spondent sold more than 90% of its fuel to Yakama-

owned retail gas stations on the Tribe’s Reservation,

which in turn sold the fuel to customers. /d. at 50a-51a.

Respondent did not obtain a fuel-importer license or

pay the Washington motor-fuel tax when either it or

KAG West brought fuel into Washington. /d. at 2a. In

* Under the Washington statute, where an entity importing fuel

into the State is acting as an agent, “the person for whom the agent

is acting is the importer.” Wash. Rev. Code Ann. § &82.36.010(16)

(West 2012).

6

December 2013, petitioner, the Washington State De-

partment of Licensing (the Department), issued an as-

sessment against respondent, demanding payment of

$3.6 million in unpaid taxes, penalties, and licensing

fees. Ibid.

Respondent appealed the assessment to an adminis-

trative law judge in the Department, who held that the

assessment violated the provision in Article III of the

1855 Treaty that secures to the Yakamas the “right, in

common with citizens of the United States, to travel

upon all publie highways.” 12 Stat. 952-953; see Pet.

App. 2a-3a. The Department’s Director overturned the

administrative law judge’s order. Pet. App. 44a-6la.

The Director reasoned that Article III of the 1855

Treaty did not exempt respondent from paying the

state motor-fuel tax because respondent “is not being

taxed for using public highways”; rather, respondent “is

being taxed for importing fuel.” /d. at 58a. The Direc-

tor concluded that respondent “needs a Washington fue!

importer license to bring fuel into this state.” bid.

4. Respondent petitioned for review in Yakima

County Superior Court, and the court set aside the Di-

rector’s order. Pet. App. 30a-43a. The court concluded

that respondent’s transport of fuel into Washington

“falls within its [rjight to [t}ravel” under Article III of

the 1855 Treaty, and that because the Washington tax

“places a restriction on the [rjight to [t)ravel,” the

“taxes, penalties, interest, and licensing requirements”

imposed by the state law “are preempted and barred by

the Treaty.” Id. at 34a.

5. The Washington Supreme Court granted direct

review and affirmed. Pet. App. la-29a.

a. The Washington Supreme Court rejected peti-

tioner’s contention that Article III of the 1855 Treaty

7

permits the State to restrict or regulate a good that is

incidentally brought over a highway. Pet. App. 6a. The

court concluded that petitioner’s interpretation of Arti-

cle III “ignores the historical significance of travel to

the Yakama Indians” and the established rule of treaty

interpretation that “Indian treaties must be interpreted

as the Indians would have understood them.” /d. at 5a-

6a (citing Choctaw Nation v. Oklahoma, 397 U.S. 620,

630-631 (1970)). The court observed that when the

Treaty was signed, the Tribe “exercised free and open

access to transport goods as a central part of a trading

network running from the western coastal tribes to the

eastern plains tribes,” and it concluded that the Treaty

was intended to preserve the Tribe’s ability to travel on

the public highways to engage in trade. /d. at 7a-8a. In

the court’s view, the Treaty accordingly secures to the

Tribe and its members a right to travel on highways

without state regulation. /bid. The state motor-fuel tax

interfered with that right, the court reasoned, because

it taxed the “importation of fuel, which is the transpor-

tation of fuel.” Jd. at 16a. The court further reasoned

that the Treaty also secures a right to conduct “any

trade, traveling, and importation,” without complying

with state regulation, so long as the Tribe “requires the

use of public roads” in carrying out that activity. /bid.

For that reason, and because, according to the court, it

would be “impossible” for respondent to import motor-

fuel to the Yakama Reservation without using the public

highways, the court held that the State could not impose

its motor-fuel excise tax on respondent. /d. at 13a-14a,

16a.

The Washington Supreme Court found support for

its conclusion in cases in which the Ninth Circuit had

ruled that two Washington laws could not be enforced

8

against members of the Tribe: a law that imposed license

and overweight-truck permit fees on persons who hauled

logs from the Tribe’s Reservation to off-reservation

mills (see Cree, 157 F.3d at 765); and a law that required

individuals other than licensed wholesalers to give no-

tice to the state liquor control board before transport-

ing “unstamped” cigarettes within the State (see

United States v. Smiskin, 487 ¥ .3d 1260, 1264 (9th Cir.

2007)). Pet. App. 9a-1la.

The Washington Supreme Court distinguished the

Ninth Circuit’s decision in King Mountain Tobacco Co.

v. McKenna, 768 F.3d 989 (2014), cert. denied, 135 S. Ct.

1542 (2015), in which a business owned by an enrolled

member of the Tribe claimed an exemption based on Ar-

ticle III of the 1855 Treaty from a Washington statute

that required the business to place money into escrow

to reimburse the State for health-care costs related to

the use of tobacco products. Pet. App. 12a-13a. The

tribal business manufactured its products by shipping

its tobacco crop to Tennessee and North Carolina for

mixing and processing and then, after returning the

processed tobacco to the Reservation, sold its products

throughout Washington and other States. 768 F.3d at

991. In King Mountain, the Ninth Circuit concluded

that the business was not exempt from making the es-

crow payments because the Treaty secured to the Tribe

the right “to travel upon all public highways,” not the

“right to trade.” Jd. at 997-998. According to the Wash-

ington Supreme Court, King Mountain stands for the

proposition that “[w]here trade does not involve travel

on public highways, the right to travel provision in the

treaty is not implicated.” Pet. App. 13a. But here, the

court concluded, “travel on public highways is directly

at issue because the tax was an importation tax,” and it

9

“was impossible for [respondent] to import fuel without

using the highway.” /d. at 13a-14a; see id. at 16a.

b. Chief Justice Fairhurst, joined by Justice Wig-

gins, dissented. Pet. App. 17a-29a. She explained that

the Tribe’s “right to travel” protected by the treaty “is

not a right to trade,” and the motor-fuel tax could there-

fore be applied to members of the Tribe because the tax

“burdens trade[,] * * * not fuel transport.” /d. at 17a.

In her view, the Washington Legislature’s clear intent

was “to levy an excise tax on the first instance of whole-

sale possession of fuel not distributed through a refin-

ery or importation terminal within the state,” and that

“(wlhether that fuel is then brought to market within

Washington is not necessary or relevant for purposes

of assessing tax due.” /d. at 18a-19a (emphasis omit-

ted); see p. 3 n.3, supra.

Chief Justice Fairhurst further concluded that the

treaty right “applies to trade only if inextricably linked

to travel,” which is not true of the motor-fuel tax. Pet.

App. 25a; see id. at 23a. She explained that in King

Mountain, the escrow payments required by state law

“had nothing to do with travel, other than to impose a

financial burden on the products King Mountain sought

to bring to market in Washington.” /d. at 26a. “Simi-

larly,” she continued, “Washington’s fuel excise tax on

importers, imposed on the first incidence of wholesale

possession of fuel within Washington, has nothing to do

with travel, other than to impose a financial burden on

the products fuel importers seek to bring to market in

Washington.” /bid. Chief Justice Fairhurst acknowl-

edged that in King Mountain and in this case, “travel

is necessary for trade” and that “[wl]ithout travel, most

goods have no market.” /bid. But she concluded that

10

“necessity of transport, without an inextricable link be-

tween travel and trade, is not sufficient for preemp-

tion.” Ibid.

SUMMARY OF ARGUMENT

The Washington Supreme Court erred in concluding

that Article III of the 1855 Treaty exempts respondent

from paying Washington’s motor-fuel tax.

A. Indian tribal members going beyond reservation

boundaries, like respondent in this case, are generally

subject to non-discriminatory state laws. State laws

may not, however, infringe on any right secured in an

Indian treaty for the tribe and its members to engage

in specific activities outside the reservation.

Article III secures to the Yakama Indians the “right,

in common with citizens of the United States, to travel

upon all public highways.” 12 Stat. 952-953. Whatever

the precise scope of that right with regard to re-

strictions on or taxation of highway use, the right, by its

plain terms, does not protect activities other than

travel, such as the possession of goods to be used in

trade. And the available historical evidence does not

demonstrate that Article III was intended to extend to

activities other than what is expressly stated in the text.

B. Washington’s motor-fuel tax falls outside of Arti-

cle III’s ambit because it is not directed at travel on

public highways, but instead the first possession of fuel

by a licensee in the State. To be sure, sometimes the

first possession occurs on public highways, if licensees

bring fuel into Washington by truck. But the State

taxes the first possession of fuel regardless of whether

that possession occurs on a highway when the fuel is

brought over the border; via some other method of

transporting fuel into the State; or at an in-state refin-

ery or terminal. Nothing about a licensee’s liability for

11

the tax turns on the licensee’s decision to use highways

in the course of its business.

The history of the motor-fuel tax further demon-

strates that the Washington Legislature was targeting

first possession, rather than the use of the highways.

The Legislature adopted the current version of the tax

after a federal court struck down an earlier version,

which the court determined had placed the incidence of

the tax on on-reservation Indian fuel retailers. Con-

sistent with guidance from this Court, the Legislature

revised the tax by shifting the incidence of the tax up

the chain to the first moment that a licensee possesses

motor fuel in the State, before delivering it to an on-

reservation entity.

C. The Washington Supreme Court erred in holding

that Article III of the 1855 Treaty nevertheless barred

the State from collecting its motor-fuel tax from re-

spondent. Notwithstanding the text of Article III and

the context and history of Washington’s motor-fuel tax,

the court determined that the tax imposed an impermis-

sible burden on public-highway travel. In so conclud-

ing, the court focused on the fact that the events giving

rise to tax liability will, for some licensees, take place on

a public highway. But the operative question in evalu-

ating a state tax is what activity the tax targets, not

where a taxed entity chooses to undertake that activity.

Washington’s motor-fuel tax does not depend upon

the use of the highways, even if respondent happened to

be using a highway when the tax was triggered. The

Washington Supreme Court did not appear to dispute

that the Treaty would not bar application of the tax to

respondent if it obtained motor fuel from a refinery or

terminal rack within the State, even if the fuel was with-

drawn into a tanker truck and then transported to the

12

Reservation on public highways. There is no reason for

a different result if respondent obtains the fuel from a

refinery or terminal rack in Oregon and brings it into

Washington by truck.

The decision below is not supported by the Ninth

Circuit decisions upon which the court relied. Washing-

ton’s motor-fuel tax is distinguishable from the state

laws at issue in those cases, which required a tribal

member to comply with certain requirements in connec-

tion with the use of the public highways to transport its

goods for trade, or required tribal businesses to notify

the State before transporting certain goods on the high-

ways. Even assuming those decisions were correct,

Washington’s motor-fuel tax does not impose require-

ments on the Tribe’s highway use, but rather imposes a

per-gallon tax on the possession of a good in commerce.

Respondent would thus be subject to Washington's

motor-fuel tax even under the Ninth Circuit’s frame-

work for interpreting the Treaty right.

ARGUMENT

ARTICLE Ul OF THE 1855 TREATY DOES NOT EXEMPT

RESPONDENT FROM PAYING WASHINGTON’S MOTOR-

FUEL TAX

The “right, in common with citizens of the United

States, to travel upon all public highways” protected by

the 1855 Treaty, art. III, 12 Stat. 952-953, is not violated

by the tax at issue here, which taxes the introduction of

a good into the state stream of commerce, no matter

where the good originates or how it enters the State.

Washington’s motor-fuel tax is a tax on the first posses-

sion of fuel within the State, which always occurs out-

side the boundaries of the Tribe’s Reservation and is

thus subject to state taxation. The Washington Su-

13

preme Court erred in concluding that Article III ex-

empts respondent from paying Washington’s motor-

fuel tax.

A. Article III Of The 1855 Treaty Secures The Right Of The

Tribe And Its Members To Free Access From The Res-

ervation To Public Highways And To Travel Upon The

Public Highways

1. “Absent express federal law to the contrary, Indi-

ans going beyond reservation boundaries have gener-

ally been held subject to nondiscriminatory state law.”

Mescalero Apache Tribe v. Jones, 411 U.S. 145, 148-149

(1973). If a federal treaty recognizes in the Indians a

right to engage in certain activities outside the reserva-

tion, however, such rights “may ... not be qualified by

the State.” Antoine v. Washington, 420 U.S. 194, 207

(1975) (quoting Puyallup Tribe v. Department of Game,

391 U.S. 392, 398 (1968)). Here, the State of Washing-

ton has imposed a tax on motor fuel that is triggered at

the time fuel enters into Washington (or when fuel is

removed from an in-state terminal or refinery), which

occurs outside of the Tribe’s Reservation. See Wagnon

v. Prairie Band Potawatomi Nation, 546 U.S. 95, 99

(2005). Accordingly, respondent is subject to the tax

unless Article III of the 1855 Treaty exempts members

of the Tribe from complying with the state law.

In determining the scope of an Indian treaty right,

courts must construe the language of a treaty “in the

sense in which [it] would naturally be understood by the

Indians” at the time the treaty was negotiated, Wash-

ington v. Washington State Commercial Passenger

Fishing Vessel Ass’n, 443 U.S. 658, 676 (1979) (Fishing

Vessel) (citation omitted), looking “beyond the written

words to the larger context that frames the [t]reaty, in-

cluding ‘the history of the treaty, the negotiations, and

14

the practical construction adopted by the parties.’”

Minnesota vy. Mille Lacs Band of Chippewa Indians,

526 U.S. 172, 196 (1999) (quoting Choctaw Nation of In-

dians v. United States, 318 U.S. 423, 432 (1943)); see

Tulee v. Washington, 315 U.S. 681, 684-685 (1942);

United States v. Winans, 198 U.S. 371, 380-381 (1905).

Doubtful or ambiguous expressions are to be “resolved

in the Indians’ favor.” Choctaw Nation v. Oklahoma,

397 U.S. 620, 630-631 (1970). Courts may not, however,

ignore “clear *** limit{s]” appearing in the treaty.

Oklahoma Taz Comm'n v. Chickasaw Nation, 515 U.S.

450, 466 (1995).

2. Applying those principles, Article III of the 1855

Treaty, as relevant here, secures for the Tribe only a

right to travel upon the public highways in common with

others, not a more general and preferential right to en-

gage in trade using the highways free of state regula-

tion or taxation.

a. Article III secures to the Yakamas a “right of

way, with free access from the [Reservation] to the

nearest public highway,” and “also the right, in common

with citizens of the United States, to travel upon all pub-

lie highways.” 1855 Treaty, art. III, 12 Stat. 952-953.

Whatever the precise preemptive scope of the latter

clause with regard to regulation and taxation of high-

way use as such, see pp. 27-29, infra, that provision of

Article I11, by its plain text, recognizes only a right of

tribal members to travel upon public highways in com-

mon with others. It does not confer any right to possess

goods that may incidentally be transported on the high-

ways, or to do so free of state regulation or taxation.

The court should respect that limit on the rights appear-

ing in the Treaty’s text. See Chickasaw Nation, 515 U.S.

at 465-466 (stating that “treaties should be construed

15

liberally in favor of * * * Indians,” but concluding that

tools of construction could not overcome a “clear geo-

graphic limit” in the treaty’s text) (citation omitted).

The Ninth Circuit—the federal circuit that encom-

passes the Tribe’s reservation and ceded lands (and the

only federal court of appeals to have addressed the

Treaty right)—has recognized that the text of Article

III is limited to protecting a right to travel upon public

highways and that the Treaty right does not preempt

state regulation of the trade of goods that involves high-

way travel. In King Mountain Tobacco Co. v.

McKenna, 768 F.3d 989 (2014), cert. denied, 135 S. Ct.

1542 (2015), the Ninth Circuit held that Article III of

the 1855 Treaty did not exempt members of the Tribe

from complying with a state law that required cigarette

companies to place money into an escrow account for

every qualifying unit of tobacco sold subject to the

State’s cigarette tax, in order to reimburse the State for

public-health expenses related to the use of tobacco

products. Jd. at 990-992.

The court of appeals in King Mountain rejected the

Tribe’s argument that Article III of the 1855 Treaty

“prohibit{s] imposition of economic restrictions or pre-

conditions on the Yakama people’s Treaty right to en-

gage in the trade of tobacco products.” 768 F.3d at 997.

The tribal business in that case shipped its tobacco crop

to Tennessee and North Carolina for processing, and

the finished product was then shipped back to the res-

ervation, where it was taken to market throughout

Washington and other States. /d. at 991. The court ex-

plained that while the Treaty secures for the Tribe a

“right to travel *** for the purpose of transporting

goods to market” without state interference, it does not

secure any right to trade beyond the right, in common

16

with others, to transport goods on the highways. /d. at

998 (emphasis added). The court analyzed the Wash-

ington escrow statute and determined that it was not a

burden or tax on transportation as such, but rather a

generally applicable provision focusing on a subject dis-

tinct from transportation that required cigarette com-

panies to place money in escrow for each unit of tobacco

sold. Jd. at 991-992. The court held that Article III did

not exempt Yakama members from complying with the

escrow law, and it based that conclusion on “the plain

text of Article III,” which, it stated, “reserve[s] to the

Yakama the right ‘to travel upon all public highways,’”

but does not discuss trade. /d. at 997 (quoting 1855

Treaty, art. III, 12 Stat. 952-953).

b. Moreover, although courts must look “beyond the

written words to the larger context that frames [an In-

dian] [t]reaty” and construe a treaty’s language in the

way it would have been understood by the Indians,

Mille Lacs, 526 U.S. at 196; Fishing Vessel, 443 U.S. at

676, the available historical materials do not demon-

strate that the Tribe would have understood Article III

of the 1855 Treaty to extend to activities other than

what is expressly stated in the text.

In this case, the Washington courts adopted findings

of fact and conclusions of law regarding the historic un-

derstanding of the Treaty right made by a federal

district court in Yakama Indian Nation v. Flores, 955

F. Supp. 1229, 1236-1246 (E.D. Wash. 1997), aff'd sub

nom. Cree v. Flores, 157 F.3d 762 (9th Cir. 1998). See

Pet. App. 3la-35a (Yakima County Superior Court’s

findings of fact and conclusions of law); id. at 5a-7a &

n.3; see also Cree, 157 F.3d at 769, 773 (Ninth Circuit

concluding that district court’s factual findings in Ya-

kima Indian Nation were not clearly erroneous). The

17

historical materials show that travel in pursuance of

trade was crucial to the Yakamas’ historic way of life,

see Yakama Indian Nation, 955 F. Supp. at 1238-1239,

and that travel was “particularly important for the pur-

pose of trade” because the Yakamas “were a central

part” of a tribal trading network “due to their location

between Northwest Coast tribes to the west and the

Plains tribes to the east,” id. at 1238. The materials

likewise show that representatives of the United States

repeatedly indicated during talks that the Yakamas’

ability to travel in order to pursue trade would be pre-

served by the Treaty. They represented, for example,

that the Yakamas would “be allowed to go on the roads

to take [their] things to market, [their] horses and cat-

tle”; that they would “be permitted to travel the roads

outside the reservation”; and that they would have “the

privilege of traveling over roads.” /d. at 1243-1244 (ci-

tations and emphasis omitted).

The historical record does not show, however, that

the Yakamas understood the Treaty to confer a right to

trade goods outside the reservation free from generally

applicable regulation and taxation—only the right to

use the public highways in common with others to en-

gage in such trading endeavors. Yakama Indian Na-

tion, 955 F. Supp. at 1253. The historical record there-

fore fully aligns with the limited terms of the Treaty’s

text. As the Ninth Circuit observed in King Mountain,

“there is no right to trade in the [1855] Treaty,” and the

Indian canon of construction “‘does not permit reliance

on ambiguities that do not exist.’” 768 F.3d at 998 (quot-

ing South Carolina v. Catawba Indian Tribe, Inc., 476

U.S. 498, 506 (1986)); see ibid. (Indian canon was inap-

plicable because “the Treaty’s meaning to the Yakama

18

people cannot overcome the plain and unambiguous text

of the Treaty,” which provides only a right to travel).

B. Washington’s Motor-Fuel Tax Does Not Infringe On

Tribal Members’ Right To Travel Upon The Public

Highways

Washington’s motor-fuel tax does not infringe on the

right under Article III of the 1855 Treaty of tribal mem-

bers to travel on public highways in common with oth-

ers. Rather, it is a tax on the possession of goods in

Washington outside the Tribe’s Reservation, which falls

within the State’s taxing authority and is imposed on re-

spondent in common with others who undertake the

first possession of motor fuel in the State, whether that

first possession occurs on a public highway or else-

where. Because Article III of the 1855 Treaty recog-

nizes only a right to travel on public highways, the

Treaty does not exempt respondent from paying Wash-

ington’s motor-fuel tax.

1. “It is a ‘fundamental canon of statutory construc-

tion that the words of a statute must be read in their

context and with a view to their place in the overall stat-

utory scheme.’” F'DA v. Brown & Williamson Tobacco

Corp., 529 U.S. 120, 133 (2000) (quoting Davis v. Mich-

igan Dep't of the Treasury, 489 U.S. 803, 809 (1989)).

Reading Washington’s motor-fuel tax as a whole

demonstrates that it is not a tax upon highway travel, at

least for purposes of assessing its validity under Article

III of the Treaty. To the contrary, fuel licensees must

pay the tax regardless of whether they remove fuel from

an in-state terminal or refinery or import fuel into the

State—and, if they import (and the fuel is not bound for

an in-state terminal or refinery, see p.3 n.3, supra), re-

gardless of what means of transport they use. Wash.

19

Rev. Code Ann. §§ 82.36.020(2)(a)-(c) (West 2012),

82.38.030(7)(a)-(c) (West 2008).

Imposition of the tax, in other words, does not de-

pend on a taxpayer’s use of the highways. The tax is

assessed per gallon of fuel, at a set rate, without regard

to how the fuel enters the state stream of commerce.

Wash. Rev. Code Ann. §§ 82.36.020(1), 82.36.025 (West

2012), 82.38.030 (West 2008); cf. Interstate Transit, Inc.

v. Lindsey, 283 U.S. 183, 190 (1931) (state tax imposed

on bus operator was a tax on doing business in the State

that violated the dormant Commerce Clause, rather

than a tax on the use of state roads, where tax liability

did not “rise with an increase in mileage travelled, or

even with the number of passengers actually carried

*** (njor [wal]s it related to the degree of wear and

tear incident to the use of motor vehicles of different

sizes and weights”). Imposition of the motor-fuel tax

and the amount of tax liability do not turn on the licen-

see’s use of the highways.

Washington’s motor-fuel tax thus is a general assess-

ment of the same type as the escrow requirement in

King Mountain. Like the escrow requirement, which

was imposed on each qualifying unit of tobacco sold,

Washington’s motor-fuel tax is imposed on each gallon

of fuel entering the state stream of commerce, irrespec-

tive of whether and how it is transported into the State.

The tax “has nothing to do with travel, other than to im-

pose a financial burden on the products fuel importers

seek to bring to market in Washington.” Pet. App. 26a

(Fairhurst, C.J., dissenting). The tax therefore is ap-

propriately viewed as an excise tax on the first instance

of possession of fuel within Washington, see id. at 17a,

not as a tax or burden on the right to travel on public

20

highways in common with others within the meaning of

Article III.

The fact that the first possession for some regulated

parties will occur on a highway does not convert an ex-

cise tax on that possession into a tax on the use of the

highway—or a burden on the “right, in common with

citizens of the United States, to travel upon all public

highways,” 1855 Treaty, art. III, 12 Stat. 952-953—any

more than a state law banning the possession of a cer-

tain product would be a ban on highway travel simply

because the ban encompasses the situation in which the

person has brought the product in from out of state via

a highway. In both the hypothetical and the present

case, the highway is only relevant because someone has

chosen it as the setting for undertaking an act (here,

possession of fuel) that is subject to a general regulation

or financial assessment, wherever the act takes place.

2. The history of Washington’s motor-fuel tax fur-

ther demonstrates that it is designed as an excise tax on

the fuel itself, not as a tax on highway travel. Before

the Washington Legislature enacted the current ver-

sion of the fuel tax, a federal district court had con-

cluded that a previous version of the tax had placed the

incidence on fuel retailers. That posed an obstacle with

respect to taxation of on-reservation Indian retailers

due to the established rule that States generally may

not tax Indian activities in Indian country. Squazin /s-

land Tribe v. Stephens, 400 F. Supp. 2d 1250, 1262

(W.D. Wash. 2005); see Pet. 5; Pet. App. 20a-22a.

In Oklahoma Tax Commission v. Chickasaw Na-

tion, supra, this Court held that although a State cannot

impose a tax on fuel sold by a tribe in Indian country,

“the State generally is free to amend its law to shift the

tax’s legal incidence.” 515 U.S. at 460. Following that

21

guidance, the Washington Legislature amended the

previous version of the motor-fuel tax by shifting its le-

gal incidence up the supply chain, such that the fuel is

taxed before it arrives on an Indian reservation. /bid.;

Pet. 5-6. The statute itself explains that the Legisla-

ture’s purpose was to impose the motor-fuel tax “at the

time and place of the first taxable event and upon the

first taxable person within thle] state.” Wash. Rev.

Code Ann. §§ 82.36.022 (West 2012), 82.38.031 (West

2008).

The Washington tax therefore operates in the same

way as the Kansas tax upheld by this Court in Wagnon,

which was imposed on fuel distributors upon “their ini-

tial receipt of motor fuel,” where the distributors were

permitted but not required to pass the tax down the dis-

tribution chain to retailers, including retailers on an In-

dian reservation. 546 U.S. at 99-100. That the State

now taxes fuel when it is first possessed by a distributor

in the State—whether when removed from a refinery or

termina! rack at a bulk storage facility in the State, or

brought in from out of State—thus reflects the State’s

effort to ensure that the incidence of the tax is not on

Indian retailers operating on Indian reservations. It

does not reflect an effort to impose any conditions or

restrictions on using the public highways. And it does

not interfere with the Treaty right to use the public

highways in common with others for trading and other

endeavors. Article III therefore does not exempt re-

spondent from paying Washington’s motor-fuel tax on

fuel that it imports from Oregon using a public highway.

22

C. The Washington Supreme Court Erred In Holding That

Article II Of The 1855 Treaty Exempts Respondent

From Paying Washington’s Motor-Fuel Tax

1. The Washington Supreme Court concluded that

the state motor-fuel tax is a tax on the use of public

highways because it “taxes the importation of fuel,

which is the transportation of fuel.” Pet. App. 16a. The

court therefore held that the tax could not be enforced

against respondent in light of Article III of the 1855

Treaty. /bid. In characterizing the tax as one targeting

highway travel, the court focused on the fact that, in re-

spondent’s case, the tax was triggered when respondent

moved fuel across the state line inside a tanker truck.

Id. at 13a-14a. The court recognized that the tax would

be assessed “regardless of whether [respondent] uses

the highway.” Jbid. But the court considered that fea-

ture “immaterial” because “in this case, it was impossi-

ble for [respondent] to import fuel without using the

highway.” Jd. at 14a. That analysis of the state fuel tax

for purposes of Article III does not withstand scrutiny.

Characterizing a tax—especially for purposes of de-

termining its validity under the 1855 Treaty—based on

only one of the types of events that trigger its applica-

tion improperly severs that trigger from the larger stat-

utory context. Cf. Brown & Williamson, 529 U.S. at 133

(courts must “interpret [a] statute ‘as a symmetrical

and coherent regulatory scheme’”) (citation omitted);

Utility Air Reg. Grp. v. EPA, 134 8. Ct. 2427, 2442

(2014) (“| R]jeasonable statutory interpretation must ac-

count for both ‘the specific context in which ... lan-

guage is used’ and ‘the broader context of the statute as

a whole.’”) (quoting Robinson v. Shell Oil Co., 519 U.S.

337, 341 (1997)). Read as a whole, Washington’s motor-

fuel tax does not depend upon use of the highways, even

23

if respondent happened to be using a highway at the

time application of the tax to respondent was triggered.

As discussed above (pp. 20-21, supra), Washington’s

revised statutory regime taxes the first possession of

fuel in the State, regardless of how or where that posses-

sion occurs. Wash. Rev. Code Ann. §§ 82.36.020(2)(a)(c)

(West 2012), 82.38.030(7) (West 2008). The Washington

Supreme Court did not appear to dispute that the

Treaty would not bar application of the tax to respond-

ent if it obtained the motor fuel from a refinery or ter-

minal rack within the State, even if the fuel was with-

drawn from the refinery or terminal rack into a tanker

truck and respondent then used the truck to transport

the fuel over public highways to the Tribe’s reservation.

There is no reason for a different result if respondent

obtains the fuel from a refinery or terminal rack outside

the State and brings it into the State by truck. That

respondent allegedly must use the highways to import

motor fuel, see Pet. App. 16a, does not alter the analy-

sis. Because respondent’s decision to obtain fuel out of

state rather than within has no bearing on its liability

for the state tax, the fact that respondent happens to be

dependent on the highways to bring fuel into Washing-

ton from out of state is immaterial to the question

whether Washington’s tax is preempted by the Treaty.

Moreover, to construe Article III to confer a right on

tribal members to avoid excise taxes on the possession

of goods that are transported by highway could have an

impact beyond the State of Washington. Petitioner

states that respondent has obtained fuel exporter li-

censes in other States. Pet. Br. 40. If the Washington

Supreme Court’s decision is affirmed, respondent could

claim a right to ship fuel from those States all over the

United States and avoid paying similar fuel-import

2A

taxes in States to which it transports fuel by highway.

Pet. App. 27a-28a (Fairhurst, C.J., dissenting).

2. The Washington Supreme Court further erred in

concluding that the historic evidence of the parties’ un-

derstanding of the Treaty right supported a reading of

Article III that would encompass a right to be free of

state taxation when engaging in activities, including

trade, that make incidental use of the highways. Pet.

App. 6a-8a. The court grounded its reasoning in two de-

cisions of the Ninth Circuit, in which members of the

Tribe had invoked Article III to claim an exemption

from paying the fees and complying with the licensing

requirements contained in other Washington statutes.

See Cree, 157 F.3d at 765; United States v. Smiskin,

487 F.3d 1260, 1264 (2007). Those decisions, even as-

suming they were correct (but see pp. 27-29, infra), do

not support the Washington Supreme Court’s conclu-

sion that Article [Il exempts respondent from paying

Washington’s motor-fuel tax. The Ninth Circuit has in-

terpreted Article III to provide certain rights for mem-

bers of the Tribe to travel on public highways free from

state taxation or other measures (except for non-reve-

nue-raising regulations that are needed to safeguard

public safety), but Washington’s motor-fuel tax does not

operate in the same way as the restrictions imposed by

Washington in those cases.

a. In Cree, supra, the Ninth Circuit considered

whether members of the Tribe were exempt from

Washington laws that required registration and licens-

ing of logging trucks along with payment of fees accord-

ing to gross weight, as well as log-tolerance permits and

an associated fee for overweight trucks. 157 F.3d at

765. The Tribe and some of its members brought a suit

for declaratory and injunctive relief after state officials

25

issued traffic citations to drivers employed by tribal log-

ging businesses that had refused to obtain the neces-

sary licenses or permits. /bid. The Tribe contended

that Article II] recognized a right in its members to

haul timber from the reservation to off-reservation

markets without restriction and that the State there-

fore could not impose licensing fees or permit require-

ments on logging trucks owned by the Tribe or its mem-

bers. bid.

To determine how Article III would have been un-

derstood by the Indians when the Treaty was adopted,

the district court conducted an extensive inquiry into

the Treaty’s history. See pp. 16-17, supra; Yakama In-

dian Nation, 955 F . Supp. at 1236-1246. The court ob-

served that at the time the Treaty was negotiated, tribal

members traveled extensively for the purpose of trade.

955 F. Supp. at 1238. Based on the language of the

Treaty, the importance of travel to the Tribe, and rep-

resentations made by federal negotiators, the court con-

cluded that tribal members would have understood Ar-

ticle III to secure a right to use public highways for

transporting logs from the Reservation to market with-

out limitations such as fees. /d. at 1246-1249. The court

held, however, that the Tribe and its members must

comply with state registration requirements for pur-

poses of identification, to the extent the requirements

did not impose a fee or surcharge on the Treaty right.

Id. at 1260.

The Ninth Circuit affirmed, holding that the 1855

Treaty exempted tribal logging companies from compli-

ance with state licensing and permitting requirements,

and payment of associated fees, for trucks hauling logs

from the Reservation on public highways. Cree, 157 F.3d

at 769. The court determined that Article III, read as

26

the Tribe would have understood it, secured for the

Tribe and its members “the right to transport goods to

market over public highways without payment of fees

for that use.” /bid.

b. In the other Ninth Circuit case relied upon by the

Washington Supreme Court, Smiskin, supra, the

United States charged two Yakama members with vio-

lating the federal Contraband Cigarette Trafficking

Act, 18 U.S.C. 2342(a), which makes it “unlawful for any

person knowingly to ship, transport, receive, possess,

sell, distribute, or purchase contraband cigarettes,” and

incorporates state law to define what is contraband. See

487 F.3d at 1263. The basis for the prosecution was that

the defendants had failed to comply with a Washington

state law that required persons other than licensed

wholesalers to give notice to state officials before trans-

porting “unstamped” cigarettes—<e., cigarettes with-

out either a “tax paid” or “tax exempt” stamp affixed to

the packaging —within the State. /bid. The federal Bu-

reau of Alcohol, Tobacco, Firearms and Explosives

(ATF) had seized 4205 cartons of unstamped cigarettes

from a defendant’s residence because ATF agents sus-

pected the defendants were transporting unstamped

cigarettes from smoke shops on an Idaho Indian reser-

vation to smoke shops on various Indian reservations in

Washington. /bid. The Ninth Circuit held that the de-

fendants’ violation of Washington’s pre-notification re-

quirement could not provide a valid basis for a federal

prosecution under Section 2342(a) because applying

that requirement to tribal members violated Article III

of the 1855 Treaty. /d. at 1264.

The Ninth Circuit again took as its interpretive base-

line this Court’s rule that “[t]he text of a treaty must be

27

construed as the Indians would naturally have under-

stood it at the time of the treaty.” Smiskin, 487 F.3d at

1264 (citing Mille Lacs, 526 U.S. at 196, 200). Based on

the history of the Treaty described by the district court

in Yakama Indian Nation, supra, the court of appeals

concluded that the pre-notification requirement was a

restriction and condition on the right to travel that vio-

lated Article III. Smiskin, 487 F.3d at 1266. The court

saw no distinction between a fee that applied to highway

travel and a pre-notification requirement insofar as the

Treaty right was concerned. /bid. Applying either to

Yakama tribal members engaged in public-highway

travel, the Ninth Circuit reasoned, “imposes a condition

on travel that violates their treaty right to transport

goods to market without restriction.” /bid.

In the view of the United States, the Ninth Circuit

erred in concluding that the pre-notification require-

ment at issue in Smiskin was a restriction on the right

to travel on public highways barred by Article III. The

purpose and effect of Washington’s pre-notification re-

quirement was to enforce (prevent evasion of) the col-

lection of the State’s tax on cigarettes. Such a tax may

be validly applied to on-reservation sales of cigarettes

to non-Indians, even by a tribe or its members, where

the incidence of the tax is on the non-Indian purchaser.

See, e.g., Washington v. Confederated Tribes of the Col-

ville Reservation, 447 U.S. 134, 154-157 (1980). The

pre-notification requirement imposed by Washington

law was not directed to the use of public highways as

such; it imposed only a modest regulatory requirement

as part of a comprehensive cigarette-tax regime. And

because the Tribe and its members were not exempt

from enforcement of the State’s overall cigarette-tax re-

28

gime, there is no reason to conclude that Article III ex-

empted the Tribe from that one feature, to which travel

was merely incidental.

c. To resolve this case, the Court need not decide the

extent, if any, to which the Ninth Circuit is correct in its

underlying premise that Article III of the 1855 Treaty

preempts certain state fees or other regulation of high-

way travel itself.” We do note, however, that Article IT]

secures to the Yakamas only “the right, in common with

citizens of the United States, to travel upon all public

highways.” 12 Stat. 952-953. That language does not on

its face confer any right greater than what other citi-

zens share or suggest that the Yakamas are exempt

from generally applicable regulations or financial as-

sessments related to use of the highways in Washington

(much less elsewhere), such as tolls or regulation or tax-

ation of trucks based on size. It is thus instructive in

this regard that the first paragraph of Article III of the

certain federal fees and taxes on trucks that use the highways and

diesel fuel used by those trucks. See U.S. Br. in Opp. at 6-10, Ram-

sey v. United States, No. 02-1547 (June 26, 2003). The issue in Ram-

sey was not, as here, the extent to which the Treaty preempts state

regulation, but rather the extent to which the Treaty exempts the

Tribe from a general, nationwide tax and fee enacted by Congress.

See 302 F.3d 1074, 1078 (9th Cir. 2002), cert. denied, 540 U.S. 812

contain such express exemptive language regarding the federal tax.

es at issue. U.S. Br. in Opp. at 5-15, Ramsey, supra (No. 02-1547).

29

1855 Treaty provides two different rights to the Yaka-

mas. The first is a special “right of way, with free access

from [the Reservation] to the nearest public highway”;

the second is a “right, in common with the citizens of the

United States, to travel upon all public highways.” /bid.

(emphasis added). The Yakamas’ special right of “free

access” to highways is guaranteed only between the

Reservation and the nearest public highways. That

phrase does not, however, modify the right to travel

upon public highways, which is granted only “in com-

mon with citizens of the United States.” /bid.*

* The phrase “in common with” also appears in the second para-

graph of Article III of the 1855 Treaty, which “secure/s] to [the Yak-

amas} *** the right of taking fish at all usual and accustomed

places, in common with citizens of the Territory.” 12 Stat. 953. The

Court has interpreted that provision to grant the Yakamas a right

broader than simply “access to fishing sites ‘in common with’” non-

Indians, to include the “right to harvest a share of the runs of anad-

romous fish” at their usual fisheries. Fishing Vessel, 443 U.S. at

675. The Court reached that conclusion, however, “(bjecause the

Indians had always exercised the right to meet their subsistence and

commercial needs by taking fish from treaty area waters” and thus

would be unlikely to view the Treaty right “as merely the chance,

shared with millions of other citizens, occasionally to dip their nets

into the territorial waters.” /d at 678-679. The Court also deter-

mined, in light of apportionment standards rooted in the “Anglo

American common law,” that the tribes should be permitted to take

up to a 50% share of the first harvest. /d at 685-686 & n27.

But unlike the fisheries, which were a pre-existing resource

from which Indians were taking fish at “usual and accustomed

places” at the time of the 1855 Treaty, 12 Stat. 953, the public high-

ways discussed in paragraph one of Article III were not natural re-

sources, were not yet in place, and were to be built and maintained

by non-Indian authorities. See Yakima Indian Nation, 955 F. Supp.

at 1244 (discussing construction of roads). There accordingly is rea-

son to doubt that the “in common with” language in the first para-

graph of Article III gives the Yakamas a preferential right to use

30

However that may be, the motor-fuel tax at issue in

this case is distinguishable from the state laws that the

Ninth Circuit determined could not be applied to mem-

bers of the Tribe in Cree and Smiskin. The Washington

motor-fuel tax is thus not preempted even under the

Ninth Circuit’s framework for interpreting the Treaty

right.

The state laws in Cree and Smiskin required tribal

members te comply with certain requirements in con-

nection with use of the public highways to transport

their goods for trade. Tribal members were required to

obtain licenses and permits and to pay fees as a precon-

dition to operating logging trucks on the highways, see

Cree, 157 F.3d at 765, or to pre-notify state officials

when transporting unstamped cigarettes on the high-

ways, see Smiskin, 487 ¥'.3d at 1262. Washington’s

motor-fuel tax, by contrast, is levied on each gallon of

fuel withdrawn from a refinery or terminal rack in the

State or brought into the State, regardless of how the

fuel is imported. Wash. Rev. Code Ann. § 82.36.020(1)

(West 2012). That the tax is imposed by reference to

the moment when motor fuel enters the state stream of

commerce does not transform the tax into an impermis-

sible burden on the use of the highways. To the contrary,

for fuel that is imported, the tax is imposed when the fuel

enters the State because the Legislature wanted to make

clear that the tax was being imposed at the first moment

of possession of motor fuel in Washington. /d. §§ 82.36.022

(West 2012), 82.38.0831 (West 2008).

In the Washington Supreme Court’s view, Washing-

ton’s motor-fuel tax is indistinguishable from the pre-

notification requirement in Smiskin because “{i}n both

the highways free of state regulation and asseasments for their con-

struction, maintenance, and safe use.

31

cases, the State placed a condition on travel that af-

fected the Yakamas’ treaty right to transport goods to

market.” Pet. App. 13a. The motor-fuel tax, however,

is not a “condition on travel.” /bid. It is an excise tax

imposed by the gallon on the possession of fuel. The tax

“has nothing to do with travel, other than to impose a

financial burden on the products fuel importers seek to

bring to market in Washington.” /d. at 26a (Fairhurst,

C.J., dissenting).

That was also true of the escrow requirement in King

Mountain, which the Ninth Circuit concluded was not

preempted by the Tribe’s right to use the public high-

ways. The Washington Supreme Court distinguished

that case on the ground that “in King Mountain, travel

was not at issue.” Pet. App. 13a. But that reading of

King Mountain is misconceived. The Tribe made King

Mountain about travel by invoking Article III to claim

an exemption from the escrow requirement for goods

that tribal businesses brought to market in Washington.

768 F.3d at 991, 997-998. That escrow requirement

imposed a financial burden on the Tribe’s trading

endeavors—unrelated to highway use—in the same way

as the motor-fuel tax in this case. The court’s effort to

distinguish King Mountain is unpersuasive.

The 1855 Treaty reserves only a right for the Tribe

to use the public highways. It does not exempt tribal

members from taxation of goods that they transport by

highway while conducting business outside the Tribe’s

Reservation. Respondent is therefore not exempt from

the state motor-fuel tax.

32

CONCLUSION

The judgment of the Washington Supreme Court

should be reversed.

Respectfully submitted.

NOEL J. FRANCISCO

Solicitor General

JEFFREY H. Woop

Acting Assistant Attorney

EDWIN S. KNEEDLER

Deputy Solicitor General

ANN O'CONNELL

Assistant to the Solicitor

General

ELIZABETH ANN PETERSON

RACHEL HERON

Attorneys

AUGUST 2018