Opposition Brief — Peabody Coal Co. v. Navajo Nation

FILED

@ DEC 10 2004

OFFICE OF THE CLERK

No. 04-634

IN THE

Supreme Court of the Gnited States

OCTOBER TERM, 2004

PEABODY COAL COMPANY,

PEABODY WESTERN COAL COMPANY, and

PEABODY HOLDING COMPANY, INC.,

Petitioners,

Vv.

THE NAVAJO NATION,

Respondent.

ON PETITION FOR A WRIT OF CERTIORARI TO THE UNITED

STATES COURT OF APPEALS FOR THE NINTH CIRCUIT

BRIEF OF THE NAVAJO NATION

IN OPPOSITION TO PETITION FOR WRIT OF CERTIORARI

Terry E. Fenzl

Counsel of Record

Joel W. Nomkin

C. Mark Kittredge

PERKINS COIE BROWN & BAIN P.A.

2901 North Central Avenue, Suite 2000

Phoenix, Arizona 85012-2788

. (602) 351-8000

December 10, 2004 Counsel for The Navajo Nation

2 SEP EI EERE NR RESID OO RESET

QUESTION PRESENTED

Whether federal-question subject-matter jurisdiction

exists over a suit brought by a non-Indian corporation

against the Navajo Nation to enforce an arbitration

award specifying royalty rates under a mineral lease

where the alleged basis for such jurisdiction is that in

unrelated litigation, the Nation has challenged the

validity of the mineral lease.

TABLE OF CONTENTS

Table Of Auten a..cisiecsnnsitocitinsiaietinaibtenendiacapaaiane ili

Statement of tlhe CHW x cincincinccscsststsslninvaxcebcbinsalacdbsanevanseanses 1

Reasons For Denying The Wit .................cssccccssssssssceseeseees 5

I. United States v. Navajo Nation, Like The Other

Unrelated Litigation Brought By The Navajo

Nation, Is Irrelevant To The Questions Raised Or

The Existence Of Federal Jurisdiction In This

II. The Court Of Appeals Correctly Held That

Peabody’s Complaint Does Not Raise Any

Question Of Federal Law Because It Does Not

Question The Validity Of Any Mineral Lease Or

Contract Approved By The Secretary, But Merely

Seeks Enforcement Of An Arbitration Award To

Which The Secretary Is Not A Party .................ccscceeeees 8

A. Peabody Mischaracterizes Its Complaint And

The Court Of Appeals’ Holding. ......................000000 9

B. The Ninth Circuit’s Holding Is.Consistent With

Other Circuits’ Precedent. ................ccccsccsssssssseesees 11

Combat x:..ccescenssssnticsnsinianedieetatatenieee eae ee ee aes 14

TABLE OF AUTHORITIES

Cases Page(s)

Bruce H. Lien Co. v. Three Affiliated Tribes,

ES ERE Te ee 13

Caterpillar Inc. v. Williams, 482 U.S. 386 (1987).............. 8

Chuska Energy Co. v. Mobil Exploration &

Producing N. Am., Inc., 854 F.2d 727

ESS pen nC NG tr SO a 12

Comstock Oil & Gas Inc. v. Ala. & Coushatta

Indian Tribes, 261 F.3d 567 (5th Cir. 2001)............... 12

Gaming World Int'l, Ltd. v. White Earth Band of

Chippewa Indians, 317 F.3d 840

ETSI be Renee RO Oe 13

Littell v. Nakai, 344 F.2d 486 (9th Cir. 1965).........0........ 12

Mescalero Apache Tribe v. Martinez, 519 F.2d

479 (10th Cir. 1975)........cccecsesseserosesssserscocensesssssssenencases 9

Moses H. Cone Mem ‘I Hospital v. Mercury

Constr. Corp., 460 U.S. 1 (19638) ..................<c.ccceeseceses 11

Niagara Mohawk Power Corp. v. Tonawanda

Band of Seneca Indians, 94 F.3d 747

SRE SS FESR Fond Raps SRO 8 Se ee Re 12

Norton v. Larney, 266 U.S. 511 (1925) .0........cccccecccceseeeeeeees 9

Rainbow Resources, Inc. v. Calf Looking,

521 F. Supp. 682 (D. Mont. 1981)...................cccceeeeeeee 13

Shulthis v. McDougal, 225 U.S. 561 (1912) ............. ee 9

Stock West, Inc. v. Confederated Tribes of the

Colville Reservation, 873 F.2d 1221

EEE ee a 8,11

Superior Oil Co. v. United States, 798 F.2d 1324

I a cada vewmasduuatinancne 13

lv

. Cases Page(s)

TTEA v. Ysleta del Sur Pueblo, 181 F.3d 676

IN eA NI iicteiaaehitstas eth Ratan dents ractacicctad va necetslaodth 8

Tamiami Partners, Ltd. v. Miccosukee Tribe of

Indians, 999 F.2d 503 (11th Cir. 1993) .................. 8, 12

Tenneco Oil Co. v. Sac & Fox Tribe of Indians,

TH FBG BTS CRO COe, DODD iii ciccsiccciinciettscscivcnstccdens 13

United States v. Navajo Nation, 537 U.S. 488

CORRS AR ke TORTI N TT REE sha ARETE ON DAO ABST 6-7

Statutes

Federal Arbitration Act, 9 U.S.C. § 4 wu... eeeeeeeeeeee ees 11

Indian Mineral Leasing Act of 1938,

BG UB Fe GO i assis issicisinittbscii cineca 1, 7, 12-13

DS AR, BE hiiitheoecittincithtscntbon ti snnntiagabiuciniasi 4,11

Rules

a a ee ie hie iecctseinestnicnttionionns iru Te

STATEMENT OF THE CASE

Petitioners Peabody Coal Company, Peabody Western

Coal Company, and Peabody Holding Company, Inc.

(“Peabody”) filed a “Complaint for Enforcement of

Arbitration Award or in the Alternative to Compel

Arbitration” in the United States District Court for the

District of Arizona. [ER 10]! The background

surrounding the complaint is fully described in the

decisions of the Court of Appeals [Pet. App. la-14a] and

the District Court [Pet. App. 15a-26a]. This Statement

highlights aspects of the case’s background that are most

relevant to the Petition.

1. The Arbitration

The arbitration award at issue in Peabody’s complaint

concerns certain mineral leases executed in the 1960s and

amended in 1987 that give Peabody the right to mine coal

on Navajo lands in exchange for a specified royalty fee

that Peabody pays to the Nation. Pursuant to the Indian

Mineral Leasing Act of 1938, 25 U.S.C. §§ 396a-396g

(“IMLA”), the leases and lease amendments were

. approved by the Secretary of Interior (“Secretary”). [Pet.

App. 2a-4a] |

Under the 1987 lease amendments, the parties agreed

to arbitration for the determination or adjustment of

future royalty rates for successive ten-year periods

beginning in 1997. [SER 5-6 (1987 lease amendments,

Article IV(b))] In the event of such an arbitration, the

lease amendments provided that the arbitrators would

determine “an equitable royalty rate.”. [ER 16 (Compl.

4 20)] In the late 1990s, the parties attempted to

renegotiate the royalty rates. When negotiations failed,

in 1998, the Navajo Nation initiated arbitration,

1 Citations to “ER” and to “SER” refer to Appellants’

Excerpts of Record and Appellee’s Supplemental Excerpts of

Record, respectively, filed in the Ninth Circuit below.

“invok[ing] the arbitration procedures set forth” in the

1987 lease amendments. [SER 114]

In demanding arbitration, the Navajo Nation did not

seek to “repudiate” [Pet. at 3] any provision of the

applicable mineral leases or lease amendments. To the

contrary, the Nation expressly sought to employ those

provisions. As Peabody acknowledged below, “[i]n these

1998 arbitration proceedings, the Navajo Nation invoked

and relied upon the ‘equitable royalty rate’ provisions of

the 1987 Lease Amendments, and asked the panel to

determine what was an ‘equitable royalty rate.” [ER 19

(Compl. J 35) (emphasis added); accord ER 66-68 (Navajo

Nation’s Prehearing Arbitration Brief)] Likewise, the

parties’ joint Arbitration Agreement, setting forth the

procedures applicable to the arbitration, reaffirmed that

the parties were not questioning the validity of the leases.

According to the Arbitration Agreement, “[t]he power and

jurisdiction of the arbitrators shall be limited to

determining the change, if any, in the royalty rates and

the royalty/tax caps applicable under the Leases, within

the limits and in accordance with the standards set

forth in the Leases.” [SER 29 (emphasis added)]

Although an arbitration panel was convened, the

parties reached a negotiated settlement [ER 69-71], which

was memorialized in a stipulated final arbitration award

[ER 72-73]. The arbitration award specified royalty rates

for the leases. Importantly, nothing in the award

required approval of the Secretary or any other federal

official. The parties agreed that “no action of the... .

Secretary is necessary to give full and final effect to the

arbitration award.” [ER 69]

The settlement agreement also provided that the

parties would execute a lease amendment, subject to the

Secretary's approval, calling for certain payments to be

made by Peabody to the Navajo Nation. Although this

lease amendment ultimately was approved by the

Secretary [ER 74-76], the settlement agreement stated

eT OE ET Se ENT See Te Ae ee eee me

that the arbitration award would remain in tact even had

the Secretary not approved the amendment. [ER 69-70

(“The entry of the final arbitration award shall not be

contingent upon or otherwise dependent upon the

approval by . . . the Secretary of the Lease Amendment

Agreement.”)] The arbitration award itself did not even

mention the lease amendment. Peabody is thus flat

wrong in stating (at 17) that the “arbitral award would

become void if the Secretary did not approve the 1998

Lease Amendments.”

2. Peabody’s Federal Court Complaint

Contrary to the Petition (at 14), Peabody’s complaint

does not seek “a declaratory judgment that the 1998

Arbitration Settlement Agreement, the Stipulated

Arbitration Award, and the 1998 Lease Amendments

were valid and binding on the Navajo Nation.” The

complaint does not seek declaratory relief at all, nor does

it question the validity of those documents.

The only place the complaint even mentions issues of

validity is in its description of an unrelated lawsuit

brought by the Navajo Nation in the United States

District Court for the District of Columbia. In that other

lawsuit, as the complaint notes, the Navajo Nation has

contended that the 1987 mineral lease amendments are

invalid because of various acts of wrongdoing by Peabody.

[ER 23-27]? But Peabody’s complaint does not ask for an

adjudication of the validity of those amendments. Rather,

Peabody’s complaint only asks for “enforcement of [the]

final arbitration award,” or, alternatively, “an order

compelling the Navajo Nation to arbitrate matters now in

2 The Navajo Nation also filed an unrelated action against

Peabody in the District of Arizona contending that “the coal

mining leases are invalid because the Nation must share a

portion of its proceeds with the Hopi Tribe.” [Pet. App. 12a n.4]

litigation in the United States District Court for the

District of Columbia.” [ER 10, 4 1]®

In requesting that specific relief, Peabody “has not

alleged that either party is failing to comply with the

award.” [Pet. App. 13a] As Peabody conceded in the

Court of Appeals, “coal is being mined and sold,” and

“Peabody is paying royalties to the Navajo Nation at the

rates found in the arbitration award.” [Id:]

3. The Decisions Below

On motion filed by the Navajo Nation, the District

Court dismissed Peabody’s complaint for lack of subject

matter jurisdiction. The District Court reasoned that

Peabody’s complaint “centers on” the final arbitration

award and its construction, “not the underlying federal

statute” under which the mineral leases were approved.

[Pet. App. 24a] In particular, the court observed that

“Peabody appears not to have brought into question or

raised any issue relating to the approval provisions of the

IMLA in its complaint.” [Jd.] Moreover, the court

rejected Peabody's apparent attempt to predicate federal

jurisdiction on the Navajo Nation’s “anticipatied]” defense

that the arbitration agreement and the 1987 lease

amendments on which that agreement was based “are

invalid under the IMLA.” ([Id.] “The possibility of a

defense based on federal law, or allegations anticipating

such a defense, do not satisfy the jurisdictional

requirement of [28 U.S.C.] § 1331.” [Pet. App. 21a (citing

this Court's authority)]

3 In the District of Columbia litigation, Peabody has

asserted the final arbitration award as a defense to the Navajo

Nation’s claims in that case. [SER 70 (Am. Answer &

Conditional Countercl., Nineteenth Affirmative Defense)] The

availability of that defense refutes Peabody's argument here

(at 24) that, absent reversal of the Ninth Circuit decision below,

it has no forum to vindicate its rights under the arbitration

award.

The Ninth Circuit affirmed. The Court of Appeals’

analysis began by noting that Peabody had not alleged a

cause of action created by federal law. [Pet. App. 7a]

Accordingly, Peabody could invoke federal jurisdiction

only if its “right to relief necessarily depends on

resolution of a substantial question of federal law.” [Pet.

App. 8a (quoting this Court’s authority)] Peabody could

have made that showing, the court ruled, had the Navajo

Nation “attempted to exceed its authority by regulating

any aspect of Peabody’s commercial enterprise under

tribal law.” [Pet. App. 12a] Likewise, federal jurisdiction

would exist if the “validity of mineral leases” were in

issue. [Pet. App. 10a] The court concluded, however, that

neither ground for federal jurisdiction existed here. [Pet.

App. 1la-12a]

In so ruling, the court recognized that in Peabody’s

appellate briefing, it attempted to characterize the

federal question in its complaint as “the enforceability of

commercial Indian mineral leases the Interior Secretary

approved under federal law.” ([Pet. App. 8a] Were the

validity of the underlying leases really raised by the

complaint, the court held that jurisdiction would exist.

[Pet. App. 10a] But in fact, the court found, “Peabody’s

actual complaint seeks enforcement of the final

arbitration award, not the underlying leases or lease

amendments.” {[Pet. App. 8a] Moreover, “the final

arbitration award for which Peabody seeks enforcement

was not federally approved.” [Pet. App. 10a] Given these

circumstances, the court held, “Peabody's complaint does

not present a federal question.” [Pet. App. 13a]

The Court of Appeals denied rehearing by the panel

and rehearing en banc. [Pet. App. 28a]

REASONS FOR DENYING THE WRIT

The Petition does not present any reason—let alone a

“compelling” one (Sup. Ct. R. 10]—justifying a grant of

certiorari in this case. Peabody first contends that

reversal is mandated by this Court's decision in United

States v. Navajo Nation. 537 U.S. 488 (2003). But that

case concerned the requirements for imposing damages

against the United States for breach of trust toward an

Indian tribe. That issue has nothing to do with this case,

which does not concern the United States at all, but only

concerns a claim by a private corporation for enforcement

of an arbitration award to which the United States is not

a party.

Second, Peabody seeks reversal because the Ninth

Circuit supposedly ignored that federal jurisdiction exists

when a complaint seeks to adjudicate the validity of a

mineral lease approved by the Secretary. But the Court

of Appeals expressly held that subject matter jurisdiction

exists when a well-pleaded complaint seeks to adjudicate

the validity of a federally-approved mineral lease.

Peabody did not come within that rule, the court found,

because its complaint does not raise any issue regarding

the validity of its lease with the Navajo Nation. That

finding was correct and, in any event, does not present

the sort of “compelling” issue meriting this Court's review.

I. UNITED STATES V. NAVAJO NATION, LIKE THE

OTHER UNRELATED LITIGATION BROUGHT BY THE

NAVAJO NATION, IS IRRELEVANT TO THE

QUESTIONS RAISED OR THE EXISTENCE OF

FEDERAL JURISDICTION IN THIS CASE.

Peabody’s Petition proclaims (at 2) that “[t]his case is

a continuation of a dispute previously before this Court in

United States v. Navajo Nation, 537 U.S. 488 (2003).”

Peabody even argues (at 25) that “summary reversal” is

warranted on the basis of Navajo Nation. But Navajo

Nation has nothing to do with the issues raised in

Peabody’s complaint in this case.

Navajo Nation involved the Tribe’s damages claim

against the United States, which alleged that the

Secretary's approval of the 1987 lease amendments

between the Navajo Nation and Peabody constituted a

breach of trust. This Court rejected the claim, concluding

that the Nation’s allegations against the Secretary did

“not derive from any liability-imposing provision of the

IMLA or its implementing regulations.” 537 U.S. at 493.

That holding is inapposite to Peabody's complaint

here. This complaint does not concern any claims against,

or any decision by, the Secretary. Rather, this complaint

merely involves Peabody’s claim against the Navajo

Nation for enforcement of an arbitration award that did

not require, and did not receive, Secretarial approval, and

to which the Secretary was not a party. As the District

Court found, Peabody simply has not “brought into

question or raised any issue relating te the approval

provisions of the IMLA in its Complaint.” [Pet. App. 24a]4

Peabody nonetheless argues (at 25) that reversal is

warranted because, in other unrelated litigation in the

District of Columbia and the District of Arizona, the

Navajo Nation has sought to “repudiate the validity of the

1987 Lease Amendments” based on arguments “rejected

by this Court in Navajo Nation.” As an initial matter,

- both of those unrelated cases concern the Navajo Nation’s

claims for relief against Peabody. Neither case involves

a claim for relief against the United States and thus

neither case implicates the issues of the United States’

liability that were decided in Navajo Nation.

More fundamentally, that the Navajo Nation has

questioned the validity of the 1987 lease amendments in

other cases is no basis for subject matter jurisdiction over _

Peabody’s complaint in this case. Under the “well-

4 The parties’ mineral lease was partially amended as a

result of their settlement agreement, and the amendment was

approved by the Secretary. But the arbitration award that

Peabody here seeks to enforce does not involve the lease

amendment, and Peabody’s complaint does not seek to

adjudicate the validity of that amendment. [See supra pp. 2-4]

pleaded complaint rule,” “federal jurisdiction exists only

when a federal question is presented on the face of the

plaintiff's [i.e., Peabody’s] properly pleaded complaint’—

not on the face of a complaint filed by someone else in

another case. Caterpillar Inc. v. Williams, 482 U.S. 386,

392 (1987) (emphasis added). Likewise, under the well-

pleaded complaint rule, the possibility that the Navajo

Nation, as a defense to Peabody’s complaint, might have

asserted arguments as to the invalidity of the lease

amendments is insufficient to create federal jurisdiction.

Id. at 393 (federal jurisdiction cannot be grounded on an

“anticipated” defense “even if both parties concede that

the federal defense is the only question truly at issue”).

In short, Peabody’s ticket to federal jurisdiction

depends entirely on the face of its complaint, which as

explained in the next section, does not present any federal

question.

II. THE COURT OF APPEALS CORRECTLY HELD THAT

PEABODY’S COMPLAINT DOES NOT RAISE ANY

QUESTION OF FEDERAL LAW BECAUSE IT DOES NOT

QUESTION THE VALIDITY OF ANY MINERAL LEASE

OR CONTRACT APPROVED BY THE SECRETARY, BUT

MERELY SEEKS ENFORCEMENT OF AN ARBITRATION

AWARD TO WHICH THE SECRETARY IS NOT A PARTY.

Peabody’s Petition does not claim federal jurisdiction

merely because an Indian tribe is a party or because this

case concerns a contract with an Indian tribe. Federal

courts are unanimous that those circumstances are not

enough to create “arising under” jurisdiction, and

Peabody does not argue to the contrary. See Stock West,

Inc. v. Confederated Tribes of the Colville Reservation, 873

F.2d 1221, 1225 (9th Cir. 1989) (no subject matter

jurisdiction over case brought to compel an Indian tribe to

arbitrate a contractual dispute); TTEA v. Ysleta del Sur

Pueblo, 181 F.3d 676, 681 (5th Cir. 1999) (“The federal

courts do not have jurisdiction to entertain routine

contract actions involving Indian tribes.”); Tamiami

Partners, Ltd. v. Miccosukee Tribe of Indians, 999 F.2d

503, 507-08 (11th Cir. 1993) (similar); Mescalero Apache

Tribe v. Martinez, 519 F.2d 479, 481-82 (10th Cir. 1975)

(similar).

Indeed this Court held long ago that a complaint did

not come within federal subject matter jurisdiction merely

because it was brought by a party seeking to enforce

rights to a Secretarial-approved mineral lease involving

Indian property. Shulthis v. McDougal, 225 U.S. 561,

569-70 (1912). Rather, for such a complaint to be deemed

to “arise under” federal law, the Court held, the complaint

must “substantially involve[] a dispute or controversy

respecting the validity, construction, or effect of such a

[federal] law, upon the determination of which the result

depends.” Id. at 569.5

Seeking to invoke this precedent, Peabody argues that

federal jurisdiction exists here because its complaint

supposedly implicates the validity of the 1987 mineral

lease amendments. In Peabody’s view, the Ninth Circuit

should be reversed because it failed to recognize that

actions implicating the validity of such federally-approved

‘leases arise under federal law. Peabody's argument,

however, misstates both its complaint and the decision of

the Court of Appeals, all in an effort to suggest an inter-

circuit conflict that does not exist.

A. Peabody Mischaracterizes Its Complaint

And The Court Of Appeals’ Holding.

Whatever may be at issue in other, unrelated

litigation, Peabody’s complaint in this action does not

“center[] on the validity of the federal approval of the

1987 Lease Amendments.” [Pet. at 18] Indeed, Peabody’s

5 Norton v. Larney, 266 U.S. 511 (1925), applied the same

rule of law and found subject matter jurisdiction in a suit over

title to Indian land because it depended upon resolution of

conflicting constructions of the relevant federal statute.

10

complaint does not put the validity of those amendments

into question at all. Rather, as the Ninth Circuit found,

Peabody’s complaint simply “seeks enforcement of the

final arbitration award.” [Pet. App. 8a]® The District

Court agreed. [Pet. App. 24a]

Having mischaracterized its complaint as implicating

the validity of the 1987 lease amendments, Peabody then

criticizes the Ninth Circuit for “cast[ing] into doubt the

ability of private parties to avail themselves of federal

court jurisdiction to establish the validity of any such

leases or contracts.” [Pet. at 25] The Ninth Circuit cast

no such doubt. To the contrary, the court expressly

recognized that federal jurisdiction exists in cases

involving “the validity of mineral leases.” [Pet. App. 10a]

The court merely and correctly found that this is not such

a case:

Peabody’s claim here does not allege any

problems with the underlying leases or

their amendments. The only contract at

issue in Peabody’s claim is the arbitration

settlement agreement, which is not a

specialized type of contract that is subject to

extensive federal regulation.

... Peabody does not contest the validity

of ‘the coal mining leases or their

amendments, nor does it allege that the

Navajo Nation has breached a lease or lease

amendment. ... In cases where a Native

6 Nor did either party in the underlying arbitration

proceeding question the validity of the lease amendments. As

Peabody admits, in instituting the arbitration, the Navajo

Nation “invoked and relied upon the ‘equitable royalty rate’

provisions of the 1987 Lease Amendments.” [ER 19 (Compl.

4 35)] And the parties’ joint Arbitration Agreement required

the arbitrators to act “within the limits and in accordance with

the standards set forth in the Leases.” [SER 29]

*

—— er

11

sovereign has not tried to assert authority

over a non-Native party, and where the

validity of a federally-regulated contract is

not at issue, courts have not found a

substantial federal question to be present.

[Pet. App. 1la-12a (footnote omitted)]

In the end, therefore, the Ninth Circuit actually

embraced the very rule of law advocated by Peabody—

that federal court jurisdiction exists in cases questioning

the validity of federally-approved leases. Although

Peabody protests the Ninth Circuit's application of that

rule to the specifics of its complaint, its protest is

factually wrong—its complaint does not raise any validity

issues—and in any event, that “as applied” protest does

not raise any important federal question that merits

issuance of the writ. See Sup. Ct. R. 10 (“A petition for a

writ of certiorari is rarely granted when the asserted

error consists of erroneous factual findings or the

misapplication of a properly stated rule of law.”).”

B. The Ninth Circuit’s Holding Is Consistent

With Other Circuits’ Precedent.

Once the Ninth Circuit’s decision is read for what it

says—rather than for what Peabody says it says—

Peabody’s attempt to create a circuit conflict fails. The

Ninth Circuit was right: where, as here, “a Native

7 Peabody's alternative claim “for an order compelling

arbitration pursuant to the Federal Arbitration Act, 9 U.S.C. §

4” also fails to support federal-question subject-matter

jurisdiction. [ER 31 (Compl. | 81)] Moses H. Cone Mem1 Hosp.

uv. Mercury Constr. Corp., 460 U.S. 1, 25 n.32 (1983) (“The

Arbitration Act ... does not create any independent federal-

question jurisdiction under 28 U.S.C. § 1331 or otherwise.”)

(citation omitted). See also Stock West, 873 F.2d at 1225

(reliance on the Federal Arbitration Act “is insufficient to confer

federal question jurisdiction” over case brought to compel

Indian tribe to-arbitrate a contractual dispute).

12

sovereign has not tried to assert authority over a non-

Native party, and where the validity of a federally-

regulated contract is not at issue, courts have not found a

substantial federal question to be present.” ([Pet. App.

12a] See, e.g., Niagara Mohawk Power Corp. uv.

Tonawanda Band of Seneca Indians, 94 F.3d 747, 752-53

(2d Cir. 1996) (holding that where the validity of a |

contract was not disputed, the fact of federal review and |

approval did not convert a simple breach of contract claim

into a federal cause of action); Tamiami Partners, Ltd. v.

Miccosukee Tribe of Indians, 999 F.2d 503, 507 (11th Cir.

1993) (finding no federal question jurisdiction where

plaintiff only presented facts establishing a breach of

contract claim); Littell v. Nakai, 344 F.2d 486, 487-88 (9th

Cir. 1965) (holding that there is no federal question where

the main dispute is centered on a contract and its |

construction, rather than the validity of the federal

approval of the contract). |

The cases cited by Peabody (at 19-22) are not to the

contrary. In each of those cases, federal jurisdiction

existed because the complaints raised issues regarding: |

(i) the scope of tribal jurisdiction over the commercial |

activities of non-Indians; or (ii) the validity of federally |

regulated contracts. See, e.g.:

e Comstock Oil & Gas Inc. v. Ala. & Coushatta |

Indian Tribes, 261 F.3d 567, 569, 572-75 (5th Cir.

2001) (federal question jurisdiction found to |

determine whether tribes had exceeded their |

governmental powers by filing suit in a newly

constituted tribal court alleging that oil and gas

leases governed by the IMLA were (ji) invalid for

lack of Secretarial approval; and (ii) void for

deficiencies in production and because Comstock

had misappropriated natural gas from tribal

lands);é )

nee mene ee,

8 See also Chuska Energy Co. v. Mobil Exploration & |

Producing N. Am., Inc., 854 F.2d 727 (5th Cir. 1988) (finding no

—

13

e Superior Oil Co. v. United States, 798 F.2d 1324,

1328-29 (10th Cir. 1986) (federal question

jurisdiction found to determine whether the tribe

exceeded its jurisdiction in withholding approval of

certain assignments of oil and gas leases under the

IMLA);

e Tenneco Oil Co. v. Sac & Fox Tribe of Indians, 725

F.2d 572, 575-76 (10th Cir. 1984) (federal question

jurisdiction found to determine whether tribe

exceeded its jurisdiction in attempting to impose

certain licensing, organizational and taxation

requirements on an oil and gas lease that was

governed by the IMLA);

e Gaming World Intl, Ltd. v. White Earth Band of

Chippewa Indians, 317 F.3d 840, 847-49 (8th Cir.

2003) (federal question jurisdiction found over

declaratory judgment action to determine scope of

tribal court jurisdiction to consider validity of

contract governed by the Indian Gaming

Regulatory Act);

e Bruce H. Lien Co. v. Three Affiliated Tribes, 93

F.3d 1412, 1421 (8th Cir. 1996) (federal question

jurisdiction found over action to determine scope of

tribal court jurisdiction to consider validity of

contract governed by the Indian Gaming

Regulatory Act);

e Rainbow Resources, Inc. v. Calf Looking, 521 F.

Supp. 682 (D. Mont. 1981) (federal question

jurisdiction found over action for declaratory and

injunctive relief regarding the jurisdiction of a

tribal court over an oil and gas lease issued under

25 U.S.C. § 396).

subject matter jurisdiction because it was only the anticipated

defense, not the complaint itself, that challenged the legality of

the oil and gas assignment at issue).

14

CONCLUSION

This case presents no novel question and creates no

conflict with any decision of this Court or among the

circuits. Accordingly, the petition for a writ of certiorari

to the United States Court of Appeals for the Ninth

Circuit should be denied.

December 10, 2004.

Respectfully submitted,

Terry E. Fenzl

Counsel of Record

Joel W. Nomkin

C. Mark Kittredge

PERKINS COIE BROWN & BAIN P.A.

Suite 2000 |

2901 North Central Avenue

Phoenix, Arizona 85012-2788

(602) 351-8000

Counsel for The Navajo Nation