Petition for Writ of Certiorari — Kickapoo Traditional Tribal Council of Texas v. Texas (No. 07-1109)

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Supreme Court U.S.

Cy O71109FEFB 25 2008

No. OFFICE OF THE CLERK

| IN THE

Supreme Court of the United States

KICKAPOO TRADITIONAL TRIBE OF TEXAS,

Petitioner,

Vv.

STATE OF TEXAS,

Respondent.

ON PETITION FOR WRIT OF CERTIORARI

TO THE UNITED STATES COURT OF APPEALS

FOR THE FIFTH CIRCUIT

PETITION FOR WRIT OF CERTIORARI

EDMUND C.GOODMAN JENNIFER P. HUGHES

HOBBS, STRAUS, DEAN Counsel of Record

& WALKER, LLP CHARLES A. HOBBS

806 SW Broadway JERRY C. STRAUS

Ste. 900 JOSEPH H. WEBSTER

Portland, OR 97205 HOBBS, STRAUS, DEAN &

(5603) 242-1745 WALKER, LLP

2120 L Street, NW, Ste. 700

Washington, DC 20037

(202) 822-8282

Counsel for Petitioner

WILSON-EPES PRINTING Co., INC. — (202) 789-0086 -— WASHINGTON, D.C. 20002

QUESTIONS PRESENTED

The Indian Gaming Regulatory Act ("IGRA"),

25 U.S.C. §§ 2701-2721, 18 U.S.C.§1166-1168 (1988),

granted states a limited role in the regulation of

Indian gaming, through gaming "compacts"

negotiated in "good faith" with tribes. To prevent

state exercise of veto power over tribal gaming, the

IGRA also authorized tribal suits in federal court to

compel "good faith” negotiations allowing: (1) a court

ordered mediation process for the selection of a

compact by the mediator, and (2) a fallback remedy

allowing the Secretary of the Interior to issue

"procedures" regulating the gaming if a state refused

to sign the mediator-selected compact. In Seminole

Tribe of Florida v. Florida, 517 U.S. 44 (1996), this

Court held that the Eleventh Amendment prevented

the application of IGRA's judicial remedy provisions

to an unconsenting state, but did not disturb the

Eleventh Circuit's ruling that Secretarial

"procedures" were still available. The decision below,

which rejected the Eleventh Circuit's analysis, has

created a conflict among the circuits on this issue,

which requires this Court to answer the critical

questions left open by the Seminole decision:

1. Does a state's refusal to consent to IGRA's judicial

remedy also nullify the Secretary's fallback authority

to issue procedures to regulate Indian gaming? The

Fifth Circuit held that it did, contrary to the

reasoning of the Ninth and Eleventh Circuits.

2. If the Secretary's fallback authority to regulate

Class III gaming is struck down, as the Fifth Circuit

held, then a corollary question has to be decided —

should not IGRA's now-inappropriate requirement of

a Tribal-State compact fall also, consistent with this

Court's severance analysis under Alaska Airlines,

Inc. v. Brock, 480 U.S. 678, 684-85 (1987)? This

question was fully argued by the Tribe, but the Fifth

Circuit elected not to address it.

ili

PARTIES TO THE PROCEEDING

Pursuant to Rule 14.1(b), the following list

represents all the parties appearing here and before

the United States Court of Appeals for the Fifth

Circuit:

Petitioner here is the Kickapoo Traditional

Tribe of Texas, a federally-recognized Indian tribe.

The Tribe originally joined this suit as a defendant-

intervenor, alongside the other appellees at the Fifth

Circuit (originally defendants in the District Court)

the United States of America, the United States

Department of the Interior, and the Secretary of the

Interior, Dirk Kempthorne. The federal defendants

have informed the Petitioner that they do not intend

to file a petition for a writ of certiorari in this case.

Appellant below and respondent here is the

State of Texas.

TABLE OF CONTENTS

Questions presented

Parties to the proceeding

Table of contents

Opinions below

Jurisdiction

Statutes and regulations involved

Statement of the case

A. Factual background

B. Proceedings below

Reasons for granting the petition

I. The Fifth Circuit's decision creates

a conflict among the circuits on a

question of exceptional importance

concerning the Indian Gaming

Regulatory Act

II. The Fifth Circuit's decision ignores this

Court's relevant authority regarding an

exceptionally important issue of

administrative law

III. The Fifth Circuit's ruling conflicts with

relevant decisions of this Court by failing to

meet its obligation under the judicial

I GID ia sina vcecncnccncdsasesnnstensaccans 20

Conclusion

APPENDIX

Appendix A

Appendix B

Appendix C

Appendix D

Appendix E

Appendix F

Page

Texas v. United States, 497 F.3d

491 (5th Cir. 2007) (United States

Court of Appeals for the Fifth

Circuit — Opinion Below) ................. la

Texas v. United States, 362 F. Supp.

2d 765 (W.D. Tex. 2005) (United

States District Court — Opinion Below)

séuceasenvenie disiinsbiaieh cobnianinemtinenettabenbsapeies CUM

Denial of Rehearing Petition

(United States Court of Appeals for the

I IN Nite ciinacacdsescacesuesieskanenes 9la

25 U.S.C. §§ 2701, 2702 and

a 93a

BB CPB. © BOY .nccncacccsccscscesscesssseses 102a

25 U.S.C. SS FB Oi © ...0c...c.s0.<0020025: 115a

TABLE OF AUTHORITIES

Cases: Page

Alaska Airlines, Inc. v. Brock, 480 U.S. 678

REET PIE MESO Ra Meee ee oO passim

Buckley v. Valeo, 424 U.S. 1 (1976) ..........ccccsseeseeee 4

California v. Cabazon Band of Mission Indians, 480

1. ANE SRIIREEE sec aerate Or Le 5

Champlin Refining Co. v. Corp. Comm'n of

Oklahoma, 286 U.S. 210 (1932) .0...........c.cccessceseseees 4

Chevron v. Natural Res. Def. Council, 467 U.S. 837

RA eR Nea FORE ER RO RR ee RIE 17, 20

City of New York v. FCC, 486 U.S. 57 (1988)....... 19

Confederated Tribes of Colville Reservation v.

Washington, No. CS-92-0426 (E.D. Wash. June 4,

Silda ithratpisnicdssecchicanisacemsnnttciaantamacascaaaianabicks 12, 26

Denver Area Educ. Telecomms. Consortium, Inc. v.

ee ee FUE Ce voiittetickbideeuciniaoinianassnnns 3

Florida v. Seminole Tribe of Florida, 517 U.S. 1133

REE AERTS LE ANID RA eA ERT A 2,11, 24

Gochicoa v. Johnson, 238 F.3d 278

(5th Cir. 2000)........... DE an Re ar RETR aE IE 13

Minnesota v. Mille Lacs Band of Chippewa Indians,

SE Pe ee WIE wistacosnsiasnspntcdndncenetinsennioensaacincantibn 3

Vil

Cases — Continued: Page

Mississippi Power & Light Co. v. Mississippi ex rel.

Moore, 487 U.S. 354 COBB) .....0.....ccccccccccnscceccescnses 18

Mohasco Corp. v. Silver, 447 U.S. 807 (1980) ...... 27

Morton v. Ruiz, 415 U.S. 199 (1974)... eee 17

Ragsdale v. Wolverine World Wide, Inc., 535 U.S. 81

COED sve rnisiosnnnicnindanniilarioiianpeesanonteiibenaiciid 16, 27

Regan v. Time, Inc., 468 U.S. 641 (1984) ...... 3, 4

Santee Sioux Nation v. Norton, No. 8:05 CV147, 2006

WL 2792734 (D. Neb. Sept. 26, 2006)................... 24

Seminole Tribe of Florida v. Florida, 11 F.3d 1016

ORR A iiss isicccnitnctiodeeaeel passim

Seminole Tribe of Florida v. Florida, 517 U.S. 44

CRO vissinisnisesncinisuscrntisemiecintg een passim

Texas v. United States, 497 F.3d 491 (5th Cir. 2007)

<stnsgachdddputedintnpiniaeidvabinhiiaceaisen nn passim

Texas v. United States, 362 F. Supp. 2d 765 (W.D.

a> | | ERED) warrsne i, 28

United States v. Booker, 543 U.S. 220 (2005)........ 3

United States v. Haggar Apparel Co., 526 U.S. 380

CRED aisssisesvisnasscnisccancsnnsnciaanacendeasionssemeesassa 17

vill

Cases — Continued: Page

United States v. Mead Corp., 533 U.S. 218

a 16, 17, 18, 19

United States v. O'Hagan, 521 U.S. 642 (1997)

United States v. Spokane Tribe, 139 F.3d 1297 (9th

EE ae POE passim

Statutes, Regulations, and Legislative History:

RITE TUNED «1c, cnccnensntogrdseecndscussesencnnnuns aa .

mIIES, Oe ss ccsssasateuanessoecnsbssanvensouono 2.15.17

ES Ta ee as 2,15, 17

Indian Gaming Regulatory Act:

18 U.S.C. §§1166-1168 .......cc.ccccseeee. i, 1

25 U.S.C. § 2701 ooccccccccecceseeceseeeeee 13, 24

25 U.S.C. § 270M) ..ccccccccccesceceseeeeeseees 5

25 U.S.C. § 270104)... eccccceceeceoceeeeees 22

25 U.S.C. § 270105)... ccccceeeee. 5, 22

25 U.S.C. § 2702 oocceccccccsesseeeeseecees 13, 24

Statutes, Regulations, and Legislative History —

Continued: Page

Indian Gaming Regulatory Act — Continued:

25 U.S.C. § 2702(2).....cceccccescsessseeevees 22

BE CEG Oe ia ieiinitnstciiniassccdnctcns 5

25 U.S.C. § 2710(b)(2)(B) ................... 5

Sk Te tS een 5, 15

25 U.S.C. § 2710(d)(1)(B) ............... oO, 7

25 U.S.C. § 2710(d)(3){A) ............. 5, 14

25 U.S.C. § 2710(d7)(ADG).........00..... 6

25 U.S.C. § 2710(d)(7)(B) ......... passim

BE DBAs. BSF vcccescincsscstinases 17

gk ioe |. : ene 12, 23, 26

Oe £1 eee 1

Senet TRINA Ut SII” setceeicentbonenioveaiossuasuesbeimnieenniensaaanaae 8

Be ae, I TIED iis siccnscessuptatisnanachosniiadesmnabadieaate 1,8,15

Sy i Se SE I cccetesisinsinsensctininniodiiintnteiunieuniiniedenin 8,15

ee ee le Oe SEE cicaatscrohecssnaasaunsenbntateiannnneananeied 8

Statutes, Regulations, and Legislative History —

Continued: Page

S. Rep. No. 100-446 (1988), as reprinted in 1988

EINE TIT icsinxsicnes naslaciecdenadbensshansaasanntas 5, 19, 22

The Kickapoo Traditional Tribe of Texas

respectfully petitions for a writ of certiorari to review

the judgment of the United States Court of Appeals

for the Fifth Circuit in this case.

OPINIONS BELOW

The opinion of the Fifth Circuit Court of

Appeals is reported at 497 F.3d 491 (5th Cir., August

17, 2007) (Appendix A). The opinion of the District

Court is reported at 362 F. Supp. 2d 765 (W.D. Tex.,

August 18, 2004)! (Appendix B).

JURISDICTION

The Court of Appeals denied the Tribe's and

the United States’ petition for rehearing en bancon

November 28, 2007, and entered judgment

December 6, 2007 (reprinted at Appendix C). This

Court has jurisdiction under 28 U.S.C. § 1254(1).

STATUTES AND REGULATIONS INVOLVED

This case involves provisions of the Indian

Gaming Regulatory Act, Public Law 100-497, codified

at 25 U.S.C. §§ 2701-2721, 18 U.S.C. §1166-1168

(1988) (relevant portions excerpted at Appendix D),

the Procedures Regulations promulgated by the

Secretary of the Interior under the authority of the

Act, 25 C.F.R. Part 291 (Appendix E), and what are

1 The reported opinion reports the date of decision as August 18,

2004. The date of decision, however, was March 30, 2005. This

Petition-cites the case with the correct year: 2005.

known as the "general authority" statutes at 25

U.S.C. §§ 2 and 9 (Appendix F).

STATEMENT OF THE CASE

This Court is called upon to address the

continuing validity of the Indian Gaming Regulatory

Act ("IGRA" or the "Act") — one of the most important

laws affecting Indian tribes ever enacted by

Congress, for the purpose of enabling tribes to

become self-supporting — in light of this Court's prior

decision in Seminole Tribe of Florida v. Florida.2 In

Seminole Tribe, this Court struck, as applied, one

portion of the Act — the judicial remedy that allowed

tribes to sue a state without its consent where the

state refused to negotiate a Class III gaming compact

with the tribe — as unconstitutional. The Court,

however, left open the question of whether Congress's

fallback remedy for tribes (the issuance of Secretarial

"procedures" to regulate tribal gaming when a state

refuses to participate in the statutory compacting

process) continued to survive.? Two circuit courts —

the Ninth and Eleventh — have reasoned that the

Secretarial procedures remedy does survive, in effect

e Seminole Tribe of Florida v. Florida, 517 U.S. 44 (1996)

(holding that IGRA's judicial remedy, which permitted a tribe to

sue a state, was unconstitutional as applied when a state

asserted its Eleventh Amendment sovereign immunity from

such suit).

3 Seminole Tribe, 517 U.S. at 76 n. 18 (noting that the

Court "doles} not here consider, and expressles] no opinion

upon" that portion of the Eleventh Circuit's holding that the

procedures remedy remains available to the Tribe). See also

Florida v. Seminole Tribe of Florida, 517 U.S. 1133 (1996)

(denying certiorari on state's petition to review that portion of

the Eleventh Circuit's decision).

treating the Seminole Tribe decision as a limited

severance of the judicial remedy only, since that was

the only part of the remedial framework that was

constitutionally flawed. In a decision at odds with its

sister circuits, however, the court below has struck

down the Secretary's attempt — through the

Procedures Regulations at issue here — to maintain

the continued effectiveness of as much of the

remaining language of the Act as possible.

Moreover, and perhaps most far-reaching in its

implications, the decision below refused to address

the corollary argument repeatedly raised by the Tribe

throughout this litigation,’ that if the fallback

provision of the Act (Secretarial procedures) is struck

down, then should not the now-inappropriate

requirement of a Tribal-State gaming compact be

struck down as well? As the Fifth Circuit left it, the

fallback remedy is no longer available to tribes. The

Fifth Circuit's failure to address this question puts

its decision at odds with this Court's precedent in

Alaska Airlines, Inc. v. Brock’ and numerous similar

decisions,® which required the Fifth Circuit to ensure

4 Judge King, in her concurring opinion below, stated that

this issue was not before the Fifth Circuit. Texas v. United

States, 497 F.3d 491, 512 (5th Cir. 2007). The record, however,

shows the Tribe repeatedly argued this issue from the beginning

of the case in the District Court and up through the Fifth

Circuit. See note 63, infra.

5 Alaska Airlines, Inc. v. Brock, 480 U.S. 678, 684-85

(1987).

6 See, e.g., United States v. Booker, 543 U.S. 220, 246-49

(2005); Minnesota v. Mille Lacs Band of Chippewa Indians, 526

U.S. 172, 19111999): Denver Area Educ. Telecomms.

Consortium, Inc. v. FCC, 518 U.S. 727, 767 (1996) (plurality

opinion); Regan v. Time, Inc., 468 U.S. 641, 653 (1984) (plurality

that its severance of part of the statute (here, the

availability to the Tribe of any remedy at all, where

the state asserts its sovereign immunity to the

judicial remedy) did not leave the remainder of the

statute operating In a manner contrary to that

intended by Congress. While acknowledging that the

decision could result in an unintended state veto

power over Indian gaming contrary to Congress's

intent, the Fifth Circuit simply refused to take this

necessary and required step.

The decision, if left standing, will have wide-

ranging consequences. It will adversely impact the

ability of all tribes in the Fifth Circuit to exercise

their rights under IGRA to conduct gaming as a

means of generating revenue where the state in

which a tribe is located simply refuses to participate

in the IGRA framework. It will adversely impact the

relationships between states and tribes in other

circuits by undermining the deliberate and careful

balance of tribal rights and state authority crafted by

Congress, creating confusion and sowing discord.

The Court should accept certiorari to avoid these

impacts and ensure that the Act continues to function

as Congress intended.

A. FACTUAL BACKGROUND

Congress enacted IGRA in 1988 to provide a

statutory framework for the regulation of Indian

gaming with the intent of ensuring that such gaming

opinion); Buckley v. Valeo, 424 U.S. 1, 108-09 (1976) (per

curiam) (quoting Champlin Refining Co. v. Corp. Comm'n of

Oklahoma, 286 U.S. 210, 234 (1932)).

was operated to provide tribes with revenue for

carrying out important governmental functions.? The

statute included a carefully balanced compromise

between Indian tribes' pre-existing right to conduct

gaming free of state regulation® and the states’ desire

to exercise authority in this area.? IGRA contains a

limited opportunity for states to participate in the

regulation of what the Act defines as "Class III"

Indian gaming.!° This opportunity is expressly

conditioned upon a state's participation in IGRA's

statutory scheme, which requires the state to

negotiate a compact in good faith with the tribe," as

well as by IGRA's recognition and continued

protection of a tribe's right to conduct such gaming if

the state "permits such gaming for any purpose by

any person, organization, or entity."!2

7 See 25 U.S.C. § 2701(1) (finding that "numerous Indian

tribes have become engaged in or have licensed gaming

activities on Indian lands as a means of generating tribal

governmental revenue"); § 2710(b)(2)(B) (limiting uses of

gaming revenue to listed governmental purposes).

8 See 25 U.S.C. § 2701(5) ("Indian tribes have the

exclusive right to regulate gaming activity on Indian lands if the

gaming activity is not specifically prohibited by Federal law and

is conducted within a State which does not, as a matter of

criminal law and public policy, prohibit such gaming activity.”).

Accord California v. Cabazon Band of Mission Indians, 480 U.S.

202, 207 (1987).

9 See 25 U.S.C. § 2710(d). See also S. Rep. No. 100-446, at

6 (1988), as reprinted in 1988 U.S.C.C.A.N. 3071, 3076.

10 Class III includes high-stakes gaming such as slot

machines, casino games, lotteries, and pari-mutuel betting 25

U.S.C. § 2703(8).

a 25 U.S.C. § 2710(d)(3)(A).

12 25 U.S.C. § 2710(d)(1)(B).

As part of this careful compromise, Congress

included a remedial framework for tribes faced with

states that refused to negotiate or negotiate in good

' faith.18 The remedial] framework involves two

distinct stages. The first stage authorizes the tribe to

sue the state in federal court, in which the state has

the burden of demonstrating that it negotiated in

good faith, and if it does not, mediation and

negotiation of a compact is mandated.!4 The second

stage is triggered only when the state refuses to

consent to the compact chosen at the conclusion of

the litigation process, at which point the statute

requires the Secretary of the Interior to prescribe

"procedures" in lieu of a compact under which the

tribe can conduct Class III gaming on its lands.!5

The Kickapoo Tribe's 125-acre reservation is

located in a remote area outside Eagle Pass in

Maverick County, Texas, along the border with

Mexico. The vast majority of the Tribe's members

live in poverty.'© In an effort to raise increased

governmental revenue to fund services to its

members and to create jobs, the Kickapoo Tribe

sought to exercise its rights under IGRA to offer

those forms of Class III gaming permitted by the

13 25 U.S.C. § 2710(d)(7)(A) (i), (BXi-vii).

14 25 U.S.C. § 2710(d)(7)(B)G-vi).

15 25 U.S.C. § 2710(d)(7)(B)(vii).

16 See (ROA, Attachments to Document #50, Exh. 3 (Joint

Stipulations of Fact, FOF No. 18) and Exh. 4 (United States

Census Bureau 2000 Data) (showing 68.1 percent of families

and 74.3 percent of individuals for the geographic area of the

Kickapoo (TX) Reservation are living below the poverty level)

(This citation is to the Record on Appeal below in the Fifth

Circuit).

State of Texas.!” In 1995, the State refused to enter

into negotiations with the Tribe, and the Tribe filed

suit pursuant to IGRA on October 13, 1995.'8 Rather

than attempt to demonstrate that its refusal to

negotiate was in "good faith," the State moved to

dismiss the lawsuit on sovereign immunity grounds.

That motion was granted based on the Seminole

Tribe decision, which held that IGRA's judicial

remedy provisions waiving state sovereign immunity

could not be constitutionally applied to an

unconsenting state.

The Seminole Tribe decision revealed an

unintended gap in IGRA: how to address the

situation where a state refuses to participate in the

statutory framework by affirmatively blocking —

through its Eleventh Amendment immunity — the

operation of the judicial remedy stage. The Secretary

responded to this gap by promulgating the

Procedures Regulations at issue here, consistent with

the Eleventh Circuit's saving construction of IGRA in

17 25 U.S.C. § 2710(d)(1)(B). Texas permits a broad range

of Class IIT gaming including all lottery games (including keno,

lotto and numbers); traditional casino style games; and off-track

pari-mutuel betting and pari-mutuel betting through

simulcasting as recognized by the U.S. Department of the

Interior. May 24, 2007, Preliminary Scope of Gaming Decision,

George Skibine, Acting Principal Assistant Secretary — Indian

Affairs, to Juan Garza, Jr., Kickapoo Tribal Chairman,

submitted to the Fifth Circuit on June 18, 2007. The scope of

Class Ill gaming that should be allowed to the Tribe is not at

issue in this case.

18 See Texas v.United States, 362 F. Supp. 2d 765, 767

(W.D. Tex 2005).

the Seminole Tribe case.*9 The Procedures

Regulations (which provide ample opportunity for

state participation) are available to a tribe if, and

only if, the state refuses to participate in the "good

faith" suit and has the suit dismissed on sovereign

immunity grounds.2°

On December 11, 2003, the Tribe applied for

Secretarial Procedures. On January 12, 2004, the

Secretary invited the State of Texas to comment on

the Tribe's proposal and submit an alternative. The

State rejected the offer to participate, and instead

filed this lawsuit.

B. PROCEEDINGS BELOW

The State filed this case in the United States

District Court for the Western District of Texas on

March 11, 2004, seeking a declaration and injunction

against the Procedures Regulations promulgated by

the Secretary pursuant to the IGRA.21 Federal court

jurisdiction was based on 28 U.S.C. § 1331 (federal

question jurisdiction) and the Administrative

Procedure Act, 5 U.S.C. § 705. The Tribe intervened

as a party defendant. On March 30, 2005, upon cross-

motions for summary judgment, the District Court

held that (1) the State's case was not ripe, and (2)

that the Secretary had the authority to promulgate

the regulations, and ordered that the State's cause of

action be dismissed without prejudice.

19 Seminole Tribe of Florida v. Florida, 11 F.3d 1016, 1029

(11th Cir. 1994).

20 25 C.F.R. § 291.3(d), (e) (2007).

21 25 C.F.R. Part 291.

The State appealed to the United States Court

of Appeals for the Fifth Circuit. Both the United

States and the Tribe participated in the appeal. On

August 17, 2007, the Court issued a fractured

decision, with all three panel judges writing

separately.22 Chief Judge Jones delivered the opinion

of the court on the issue of ripeness, joined by Judge

King, holding that the State's cause of action was

ripe.23 Chief Judge Jones and Judge King concurred

in the holding that the Procedures Regulations were

invalid, but wrote separate and substantially

differing opinions as to the grounds therefor. Judge

Dennis wrote a detailed and comprehensive dissent.

The Tribe and the United States both filed

timely petitions for rehearing en banc. The Fifth

Circuit issued an order denying the petitions for

rehearing on November 28, 2007. This petition for

certiorari has been timely filed.

REASONS FOR GRANTING THE PETITION

This case involves an issue of exceptional

importance that impacts Indian tribes and states

around the country, as well as the United States.

Under the result created by the decision below, tribes

are barred from the fallback remedy Congress

intended to be available to a tribe faced with a state

that refuses to consent to IGRA’s remedy process,

thereby undoing Congress’s careful compromise. The

decision clashes with the reasoning of two sister

22 Texas, 497 F.3d at 491, 511 (King, J., concurring), 512

(Dennis, J., dissenting).

23 While the Tribe argued below that the case was not ripe,

it does not seek certiorari on the question of ripeness.

circuits on this same issue (the continued availability

of the Secretarial procedures remedy in light of

Seminole Tribe), fails to grant appropriate deference

to the reasonable construction of a statutory gap by

the Executive Branch official with delegated

authority under the statute, and conflicts with this

Court's directly relevant precedent concerning

statutory severance.

I. The Fifth Circuit's Decision Creates a Conflict

Among the Circuits on a Question of Exceptional

Importance Concerning the Indian Gaming

Regulatory Act

The two other circuits that have considered

IGRA's remedial framework in light of Seminole

Tribe's holding both reasoned that the Act can

continue to function in the manner intended by

Congress where the judicial remedy is severed,

recognizing that a state's refusal to participate in the

judicial remedy does not deprive a tribe of all its

statutorily protected rights.24 Rather, both circuits

recognized the continued availability of the

Secretarial procedures as a means of regulating and

facilitating a tribe's right to offer Class ITI gaming

when the tribe is located in a state that otherwise

permits such gaming.2®

24 See United States v. Spokane Tribe, 139 F.3d 1297,

1301-02 (9th Cir. 1998): Seminole Tribe, 11 F.3d at 1029 (11th

Cir. 1994).

25 Thus, under IGRA, the only tribes that would ever be

completely unable to engage in Class III gaming are those tribes

located in states that do not permit any Class III gaming

anywhere in the state by anyone under any circumstances.

The Fifth Circuit's decision clashes with the

reasoning of the Ninth and Eleventh Circuits

concerning the impact of this Court's Seminole Tribe

holding on the continuing availability of the fallback

Secretarial procedures remedy. The primary opinion

in the Fifth Circuit decision in fact misstates the case

and its relation to Seminole Tribe from the first

sentence, asserting that the Procedures Regulations

are an attempt to "circumvent" the Seminole Tribe

decision.26 Seminole Tribe, however, did not strike

down the second stage of the IGRA remedial

framework, but rather left open the question of the

continued availability of the fallback procedures

remedy.2? The Ninth and the Eleventh Circuits,

contrary to the Fifth Circuit here, found that the

continued availability of the Secretarial procedures

remedy was consistent with the holding in Seminole

Tribe, not a "circumvention" of it.28

The Ninth and Eleventh Circuits both

reasoned that the Secretarial procedures remedy was

an indispensable component of the regulatory

structure and compromise framework established by

IGRA, and that the judicial remedy could be severed

or invalidated while still leaving this provision in

place. The Eleventh Circuit in Seminole Tribe,

26 Texas, 497 F.3d at 493.

27 Seminole Tribe, 517 U.S. at 76 n. 18. In fact, the Court

refused to grant certiorari on this question. Florida, 517 U.S.

1133 (1996).

28 Spokane Tribe, 139 F.3d at 1301-02: Seminole Tribe, 11

F 3d at 1029. While the latter decision came out prior to this

Court's decision in the same case, the holding on the key point —

that IGRA's judicial remedy is invalid when the State does not

consent — was the same.

consistent with this Court's subsequent decision on

certiorari in that case, found that IGRA's judicial

remedy provision was unconstitutional as applied to

a state that did not consent to suit. The Eleventh

Circuit also addressed the question of whethe. the

entire IGRA (or at least all its state participation

requirements) must be struck if the judicial remedy

was determined to be unavailable, as the federal

District Court for the Eastern District of Washington

had previously held?9:

The final question we must resolve is whether

all provisions for state involvement in class III

gaming also fail, as the tribes contend. We

hold that they do not. IGRA contains an

explicit severability clause, § 2721; and we find

no “strong evidence” to ignore that plain

congressional directive. See Alaska Airlines,

Inc. v. Brock, 480 U.S. 678, 686, 107 S.Ct.

1476, 1481, 94 L.Ed.2d 661 (1987).

Nevertheless, we are left with the question as

to what procedure is left for an Indian tribe

faced with a state that not only will not

negotiate in good faith, but also will not

consent to suit. The answer, gleaned from the

statute, is simple. One hundred and eighty

days after the tribe first requests negotiations

with the state, the tribe may fiie suit in district

court. If the state pleads an Eleventh

Amendment defense, the suit is dismissed, and

Confederated Tribes of Colvilie Reservation v.

Washington, No. CS-92-0426, slip op. at 4-5 (E.D. Wash. June 4,

1993); (ROA, Attachments to Doc. #50, Exh. 11) (striking down

IGRA Class III provisions in absence of remedy for tribes) (This

citation is to the Record on Appeal below in the Fifth Circuit).

the tribe, pursuant to 25 U.S.C.

§ 2710(d)(7)(B)(vid), then may notify the

Secretary of the Interior of the tribe's failure to

negotiate a compact with the state. The

Secretary then may prescribe regulations

governing class III gaming on the tribe's lands.

This solution conforms with IGRA and serves

to achieve Congress’ goals, as delineated in

§ § 2701-02.30

Similarly, the Ninth Circuit also reasoned that

the judicial remedy cou:d be severed while leaving

the procedures remedy intact, noting that:

IGRA as passed thus struck a finely-tuned

balance between the interests of the states and

the tribes. Most likely it would not have been

enacted if that balance had tipped conclusively

in favor of the states, and without IGRA the

states would have no say whatever over Indian

gaming. *!

The court went on to note that, in light of this

30 Seminole Tribe, 11 F.3d at 1029. Contrary to a previous

assertion by the State of Texas, the Eleventh Circuit's

determination that the Secretary has the authority to issue

procedures was not dictum since it was a central and necessary

part of the court's decision. See Gochicoa v. Johnson, 238 F.3d

278, 286 n.11 (5th Cir. 2000) (a statement is dictum only if it

“could have been deleted without seriously impairing the

analytical foundations of the holding"). As noted by the court:

“The final guestion we must resolve is whether all provisions for

state involvement in class Il] gaming also fail, as the tribes

contend. We Ao/dthat they do not.” Seminole Tribe, 11 F.3d at

1029 (emphases added)

u Spokane Tribe, 139 F.3d at 1301

Court's decision in Seminole Tribe, the Eleventh

Circuit's reasoning about the continued availability of

the procedures remedy "is a lot closer to Congress's

intent than mechanically enforcing IGRA against

tribes even when states refuse to negotiate."°

As the Eleventh and Ninth Circuits both

recognized, Congress did not delegate its regulatory

authority over tribal gaming to states — it provided

the states with an opportunity to participate in the

compacting process along with the tribes and the

federal government, and it conditioned that

participation on the states’ willingness to participate

in the statutory process in good faith.33 Congress

intended for the good faith requirement to be

enforceable in federal court, and provided for a

judicially supervised mediation process under which

the state has the burden of demonstrating that its

refusal to negotiate a compact was done in good

faith.44 Recognizing that some states might still

refuse to participate in the statutory process,

Congress provided tribes with a fallback remedy —

the ability to go directly to the Secretary of the

Interior, who has the express statutory authority to

prescribe "procedures" to govern tribal gaming in the

absence of a compact.*

Congress did not anticipate that the Supreme

Court would hold that it could not require states to

participate in the judicially supervised component of

the statutory process. With no way to compel

32 Id. at 1302.

33 25 U.S.C. § 2710(d)(3)(A).

34 25 U.S.C. § 2710(d)(7)( Bi).

25 U.S.C. § 2710(d)(7)(B)(vii).

participation in the statutory process by states that

will not waive their Eleventh Amendment immunity

from suit, the tribes, states, and United States were

left with an unintended gap in the statute. The

Ninth and Eleventh Circuits reasoned that the Act

could survive — 1.e., could continue to function

consistent with Congress's intent — by recognizing the

continued availability of the Secretarial procedures

remedy. The Secretary of the Interior, following this

reasoning, exercised his general authority to

promulgate regulations under 25 U.S.C. §§ 2 and 9,

and his specific authority under 25 U.S.C. § 2710(d),

and filled the gap with the Procedures Regulations at

issue here: providing tribes located in states that will

not participate in adjudication of their good faith or

judicially supervised mediation of compact

negotiations with a path to the fallback remedy

provided by Congress.*6

By invalidating the Procedures Regulations,

the decision below has undermined the carefully

structured compromise between tribes and states

intended by Congress, based, largely, on the illogical

ground that where a state asserts its sovereign

immunity to avoid the judicial remedy it has

somehow been denied the impartial decision maker

intended by Congress.?? As a result of the decision,

states in the Fifth Circuit can bar tribal access to the

fallback procedures mechanism — despite allowing

gaming themselves — by simply refusing to negotiate

and refusing to litigate the question of their lack of

36 25 C.F.R. Part 291.

37 Texas, 497 F.3d at 508. The Procedures Regulations are

available to a tribe if, and only after, the state asserts its

immunity to the good faith lawsuit. 25 CFR § 291.3(d).

good faith in federal court: an outcome contrary to

Congress's intent when enacting IGRA. The Court

should accept certiorari to resolve the conflict among

the circuits on this critically important matter.

II. The Fifth Circuit's Decision Ignores this Court's

Relevant Authority Regarding an Exceptionally

Important Issue of Administrative Law

The Fifth Circuit's ruling, and in particular the

primary opinion by Chief Judge Jones, diverges

substantially from existing relevant authority from

this Court regarding the ability of an Executive

Branch official to fill an unintended and unforeseen

gap in a statute he was delegated authority to

administer, and diverges from this Court's

instruction to "respect and give effect to" the kinds of

legislative compromises embodied in IGRA's remedial

framework.*8 The Fifth Circuit inappropriately failed

to grant deference to the Secretary's reasonable.

construction of that statute — which respects and

gives effect to Congress's compromise in the IGRA -.

and thus plows new and uncharted ground in the

field of administrative law.

First, the decision below focuses too narrowly

on one provision of the Act when analyzing the

Secretary's authority. United States v. Mead Corp.

and other decisions instruct that, rather than analyze

various sources of agency authority one-by-one (as

the Fifth Circuit did below in determining that the

Secretary had not been delegated sufficient authority

38 Ragsdale v. Wolverine World Wide, Inc., 535 U.S. 81, 94

(2002).

to issue the Procedures Regulations), federal courts

must take a more comprehensive and integrated

approach to the statute(s) at issue.39 Express

delegation of general rulemaking authority is, these

decisions hold, especially powerful grounds for

deference,*° as is the fact that Congress vested the

agency with overall responsibility for administering

or implementing a statute or program.‘! Here, the

exercise of the Secretary's regulatory authority was

grounded in such a delegation of authority. In

addition to the Secretary's express delegated

authority to carry IGRA into effect (including,

specifically, the fallback remedy for tribes),42 his

authority to issue the regulations at issue was based

on two statutes whose plain terms confer power on

the President to "prescribe such regulations as he

may think fit for carrying into effect the various

provisions of any act relating to Indian affairs" 43 and

to the Commissioner of Indian Affairs (under

direction of the Secretary of the Interior) to “have the

management of all Indian affairs and of all matters

arising out of Indian relations" pursuant to

regulations adopted by the President.44 Moreover,

39 United States v. Mead Corp., 533 U.S. 218, 226 (2001):

United States v. O'Hagan, 521 U.S. 642, 673 n. 19 (1997).

40 See Mead, 533 U.S. at 226; United States v. Haggar

Apparel Co., 526 U.S. 380, 392-93 (1999); O'Hagan, 521 U.S. at

673.

41 See Chevron v. Natural Res. Def. Council, 467 U.S. 837,

843-44 (1984); Morton v. Ruiz, 415 U.S. 199, 231 (1974).

42 See 25 U.S.C. §§ 2710(d)(8), 2710(d)(7)(B)(vii)).

43 25 U.S.C. § 9.

44 25 U.S.C. § 2. See also Morton, 415 U.S. at 231 ("In the

area of Indian affairs, the Executive has long been empowered

to promulgate rules and policies, and the power has been given

explicitly to the Secretary... .").

the decision below — directly contrary to the

admonition of this Court — failed to grant the

appropriate deference to the Secretary's

determination of his own statutory authority.45

Second, the Fifth Circuit failed to follow this

Court's admonition that it must accept the

Secretary's interpretation if the following three

factors are met: Congress has not previously spoken

directly to the issue; the agency has been delegated

authority under the statute; and the agency's

interpretation is reasonable.46 The Secretary's

Procedures Regulations meet these three

requirements: (1) in this case, Congress did not

speak directly to the issue because it did not foresee a

state's ability to assert Eleventh Amendment

45 Mississippi Power & Light Co. v. Mississippi ex rel.

Moore, 487 U.S. 354, 380-81 (1988) (Scalia, J., concurring). In

this frequently cited concurring opinion, Justice Scalia collected

numerous examples supporting this approach and explained:

giving deference to an administrative interpretation of

its statutory jurisdiction or authority is both necessary

and appropriate. It is mecessary because there is no

discernible line between an agency's exceeding its

authority and an agency's exceeding authorized

application of its authority. To exceed authorized

application is to exceed authority. Virtually any

administrative action can be characterized as either the

one or the other, depending upon how generally one

wishes to describe the "authority.". And deference is

appropriate because it is consistent with the general

rationale for deference: Congress would naturally expect

that the agency would be responsible, within broad

limits, for resolving ambiguities in its statutory

authority or jurisdiction.

Td. at 381-82 (internal citations omitted).

46 Mead, 533 U.S. at 229.

immunity to avoid its burden of demonstrating that

its refusal to participate in IGRA was in "good

faith"47; (2) Congress did, however, delegate authority

to the Secretary of the Interior to implement the Act;

and (3) the Secretary's interpretation of the statutory

gap revealed by Seminole Tribe is reasonable, since it

preserves the remaining part of the remedial

framework and ensures that the statute continues to

function consistent with the manner intended by

Congress — keeping intact a critical part of a remedial

framework specifically intended to protect IGRA's

compromise between states and tribes.48 In such

situations, the question for courts to decide — with

deference to agencies’ expertise and their political

accountability — is whether the agency resolution is

"one that Congress would have sanctioned."49

Third, the decision below does not follow this

Court's clear instruction that "a reviewing court has no

business rejecting an agency's exercise of its generally

conferred authority to resolve a particular statutory

ambiguity simply because the agency's chosen

resolution seems unwise."59 Rather, the primary

opinion in the decision below is concerned only with

the preservation of a single "procedural safeguard," a

judicial determination of whether the state met its

47 25 U.S.C. § 2710(d)(7)(B) Gi). See Spokane, 139 F.3d at

1300 (quoting Senator Inouye, one of IGRA's sponsors, as

stating “if we had known that this proposal of tribal state

compacts that came from the States and was strongly supported

by the States, would later be rendered virtually meaningless by

the action of those states . .. we would not have gone down this

path").

48 Spokane, 139 F.3d at 1302: S. Rep. No. 100-446, at 13.

49 City of New York v. FCC, 486 U.S. 57, 69 (1988).

Mead, 533 U.S. at 229.

burden of demonstrating that it negotiated in good

faith — a determination that is unavailable to a state

only if the state chooses not to participate. This

cramped reading of the statute is inconsistent with

the underlying purpose of the statute and the context

of its enactment, in which Congress did not expressly

limit the Secretary's broad powers to authorize

gaming, except to the extent that it required a

compact for Class III gaming and specifically

established a series of steps to ensure such a compact

was reached. In that context, given that the Act itself

requires the Secretary to promulgate gaming

procedures in the event that the judicial process fails,

the regulations must be accepted "unless it appears

from the statute or its legislative history that the

accommodation is not one that Congress would have

sanctioned."51

This Court should grant certiorari to ensure

that the Fifth Circuit remains consistent with

relevant Court precedent on this important question

of administrative law.

III. The Fifth Circuit's Ruling Conflicts with

Relevant Decisions of this Court by Failing to Meet

its Obligation under the Judicial Severance Doctrine

Finally, the Fifth Circuit's decision conflicts

with relevant decisions of this Court regarding

judicial severance of statutes. As this Court

instructed in Alaska Airlines, *? even where a statute,

like IGRA, has a severability clause, the resulting

Chevron, 467 U.S. at 845.

480 U.S. at 685.

statute after severance of its unconstitutional

provisions cannot remain in force if that resulting

statute would be inconsistent with Congress's intent.

As articulated in A/aska Airlines, where.a statute is

judicially severed it must be done in such a way to

ensure that "the statute will function in a manner

consistent with the intent of Congress."53 If this

cannot be done, the statute must be declared invalid.

The purpose of this obligation is obvious: to protect

the constitutional separation of powers by ensuring

that courts do not legislate. By failing to meet this

obligation, the Fifth Circuit's ruling has encroached

on the policy-making domain reserved to Congress

under the Constitution.

By refusing to recognize the validity of the

Procedures Regulations, but failing to address the

question of the continuing validity of IGRA's

provisions for state involvement in Class III gaming,

the panel's decision has the potential to result in a

version of IGRA that Congress did not intend to pass.

Congress enacted the IGRA "to provide a statutory

basis for the operation of gaming by Indian tribes as

a means of promoting tribal economic development,

self-sufficiency, and strong tribal governments" and:

to provide a statutory basis for the regulation

of gaming by an Indian tribe adequate to

shield it from organized crime and other

corrupting influences, to ensure that the

Indian tribe is the primary beneficiary of the

gaming operation, and to assure that gaming is

conducted fairly and honestly by both the

Id. (emphasis in original).

operator and players.*4

The IGRA granted states a limited, conditional

opportunity (through the compacting process) to

participate in the regulation of Indian Class III

gaming that states previously lacked, but also

provided a remedy for tribes to be able to conduct

Class III gaming in those situations where a state

objects to such gaming and refuses to enter into a

compact.

The IGRA's express statutory language as well

as its legislative history demonstrates that Congress

did not intend for states to have a veto over tribal

gaming under IGRA. The IGRA's statutory findings

note, for example, that "a principal goal of Federal

Indian policy is to promote tribal economic

development, tribal self-sufficiency, and strong tribal

government" and that "Indian tribes have the

exclusive right to regulate gaming activity on Indian

lands if the gaming activity is not specifically

prohibited by Federal law and is conducted within a

State which does not, as a matter of criminal law and

public policy, prohibit such gaming activity."55 The

Committee Report accompanying the bill stated:

It is the Committee's intent that the compact

requirement for class III not be used as a

justification by a State for excluding Indian

tribes from such gaming or for the protection of

other State-licensed gaming enterprises from

free market competition with Indian tribes.*®

54 25 U.S.C. § 2702(1), (2).

85 25 U.S.C. § 2701(4), (5).

56 See S. Rep. No. 100-446, at 13.

Granting the state a role in the regulation of

gaming was meant to be consistent with these

findings and purposes, and not an opportunity for the

state to undermine them. For this reason Congress

enacted the remedial provisions of the IGRA,

including the fallback remedy of Secretarial

procedures, to ensure that tribal rights would be

protected. Therefore, under the severance doctrine,

when the first stage of the remedial process — the

"good faith" lawsuit — is declared void where the state

refuses to participate, the fallback remedy of

Secretarial procedures must remain in place as a

saving construction of the statute to ensure that the

statute continues to operate in the manner intended

by Congress. This limited severance is in fact

consistent with the severability clause in the

statute’? as well as with the severability doctrine

itself, since severing the judicial remedy while

leaving the procedures remedy in place (which does

not share the constitutional flaw of subjecting a state

to suit without its consent) is consistent with the

intent of Congress in ensuring that tribes have a

remedy when faced with a recalcitrant state.

The Eleventh Circuit has already expressly

held, in severing the judicial remedy provision of

IGRA, that the Secretary has both the power and the

duty to issue procedures under the circumstances

provided for in the Regulations at issue, noting that

this is a "solution [that] conforms with IGRA and

serves to achieve Congress' goals, as delineated in

25 U.S.C. § 2721.

§§ 2701-02."58 Only by determining that a tribe could

go directly to the Secretary for procedures as a

fallback remedy did the Eleventh Circuit hold that

the Class III compact requirements could stand

under a traditional severance analysis, thus

recognizing the continued availability of Secretarial

procedures as a saving construction necessary to

preserve congressional intent.59

The Ninth Circuit Court of Appeals ultimately

agreed with the Eleventh Circuit's rationale in the

Spokane case, rejecting its own earlier criticism.®

Thus, the two circuit courts which have previously

addressed the issue both agree that it is proper to

sever the unsound portions of IGRA with a saving

construction that maintains the Secretary's authority

to fill the gap in IGRA's remedial framework.®!

In the decision below, the concurring opinion

acknowledges that without the Procedures

Regulations IGRA would not function as Congress

intended — that the decision could result in an

58 Seminole Tribe, 11 F.3d at 1029.

59 Id. Although requested to do so by the States of Florida

and Alabama, this Court did not address the decision of the

Eleventh Circuit on this issue, and it thus remains the law of

that Circuit. Seminole Tribe of Florida, 517 U.S. at 76 n.18.

See also Florida, 517 U.S. 1133 (rejecting separate certiorari

petition on this issue).

60 Spokane Tribe, 139 F.3d at 1302 ("the Eleventh Circuit's

suggestion is a lot closer to Congress's intent than mechanically

enforcing IGRA against tribes even when states refuse to

negotiate").

61 See also Santee Stoux Nation v. Norton, No. 8:05 CV 147,

2006 WL 2792734, at *6 (D. Neb. Sept. 26, 2006).

unintended state veto power.® The Fifth Circuit's

failure to take the next step of determining whether

it is necessary to strike down IGRA's state

participation requirements, puts it in direct conflict

with the statutory severance analysis set out by this

Court in Alaska Airlines and other decisions.

The Tribe has consistently argued throughout

this case that Seminole Tribe's limited severance of

IGRA's judicial remedy mechanism requires the

continued availability of the fallback procedures

remedy as a saving construction of the statute.®? In

the alternative, and as a necessary corollary to this

argument, the Tribe also argued that if the Secretary

cannot fill the gap in IGRA's remedial framework for

tribes that face unconsenting states, then the

entirety of IGRA's requirements regarding state

participation must be declared void as applied when

the state refuses to participate in the IGRA remedial

process. ®4 The Fifth Circuit, however, failed to

address these well-established and long-standing

62 Texas, 497 F.3d at 512 (noting that, as a result of this

decision, the state now has "the leverage to block gaming on

Indian land under IGRA in a manner wholly contrary to

Congress's intent").

63 The following citations to the record are to the Record of

Appeal below in the Fifth Circuit. See Tribe's Brief in

Opposition to Preliminary Injunction (March 26, 2004) at 8-9

(ROA 00220-21); Tribe’s Brief in Support of Motion to Dismiss

and for Summary Judgment (August 18, 2004) at 31-39 (ROA

"Document #50); Tribe's Response to State's Motion for

Summary Judgment (August 18, 2004) at 10 (ROA 00809);

Tribe's Summary Judgment Reply Brief (September 7, 2004) at

3 (ROA 00877); Transcript of Summary Judgment Hearing

(October 26, 2004) at 52:22-58:16 (ROA Volume 7); Tribe's Fifth

Circuit Appellate Brief (August 23, 2005) at 46—50.

64 Td.

severance principles set forth by the Supreme Court

and to discharge its obligation under those principles.

If IGRA were left without a remedy for tribes,

the statute will no longer function in the manner

intended by Congress, as the Ninth and Eleventh

Circuits have already held (and as the concurrence

below concedes). Therefore, this remedy of the

Secretarial procedures cannot be removed from the

statute without all its state participation

requirements being held invalid when a tribe faces

an unconsenting state.®

65 Alaska Airlines, 480 U.S. at 684; Seminole, 11 F.3d at

1029. While IGRA has a severability clause (25 U.S.C. § 2721),

that clause merely creates a rebuttable presumption against the

need to declare the entire statute invalid. A/aska Airlines, 480

U.S. at 686. At issue here is what portion of the statute needs

to be severed to remove the unconstitutional portion while

retaining as much of the framework intended by Congress as

possible. Moreover, this presumption of severability, even if

applicable to this case, would be overcome here because the

severance by the decision below will result in a statutory

scheme (1) that no longer functions in the manner Congress

intended, (2) that bears little resemblance to the scheme

enacted by Congress, and (3) that would not be fully operative

asa law. Jd. at 684-85. See also Confederated Tribes of Colville

Reservation, No. CS-92-0426, slip op. at 4-5: (ROA, Attachments

to Doc. #50, Exh. 11) (striking down IGRA Class III provisions

in absence of remedy for tribes) (This citation is to the Record on

Appeal below in the Fifth Circuit).

CONCLUSION

The Fifth Circuit's decision improperly

jettisons Congress's careful compromise in IGRA. In

so doing it clashes with the reasoning of its sister

circuits, unduly substitutes its reasoning for that of

the Executive Branch official charged with

implementing the Act, and grants states power

unintended by Congress. The decision violates a

fundamental precept of statutory construction, which

states that "[clourts and agencies must respect and

give effect to these sorts of compromises."®* The

Kickapoo Traditional Tribe of Texas respectfully

requests that its petition for writ of certiorari be

granted so that this Court can complete the analysis

on the critical questions left open by Seminole Tribe.

Respectfully Submitted,

EDMUND C. GOODMAN JENNIFER P. HUGHES

HOBBS, STRAUS, DEAN Counsel of Record

& WALKER, LLP CHARLES A. HOBBS

806 SW Broadway JERRY C. STRAUS

Suite 900 JOSEPH H. WEBSTER

Portland, OR 97205 HOBBS, STRAUS, DEAN &

(503) 242-1745 WALKER, LLP

2120 L Street, NW

Suite 700

February 25, 2008 Washington, DC 20037

(202) 822-8282

66 Ragsdale, 535 U.S. at 94 (citing Mohasco Corp. v. Silver,

447 U.S. 807, 818-819 (1980))

APPENDIX

APPENDIX A: Jexas v. United States, 497 F.3d 491

(5th Cir. 2007)

(United States Court of Appeals for the Fifth Circuit

— Opinion Below)

United States Court of Appeals Fifth Circuit

FILED August 17, 2007

Charles R. Fulbruge III Clerk

REVISED SEPTEMBER 13, 2007

UNITED STATES COURT OF APPE:SLS FOR THE

FIFTH CIRCUIT

No. 05-50754

STATE OF TEXAS,

Plaintiff-Appellant,

versus

UNITED STATES OF AMERICA; UNITED STATES

DEPARTMENT OF THE INTERIOR; DIRK

KEMPTHORNE, in his Official Capacity as Secretary

of the Department of the Interior, |

Defendants-Appellees,

KICKAPOO TRADITIONAL TRIBE OF TEXAS,

Intervenor-Defendant-Appellee.

Appeal from the United States District Court for the

Western District of Texas

Before JONES, Chief Judge, and KING and DENNIS,

Circuit Judges.

EDITH H. JONES, Chief Judge:

This is high-stakes litigation involving a

challenge to procedures adopted by the Secretary of

the Interior Department (“Secretary”) to circumvent

the consequences of the Supreme Court’s Eleventh

Amendment decision in Seminole Tribe of Florida v.

Florida, 517 U.S. 44, 116 S. Ct. 1114 (1996). An initial

question is whether Texas’s challenge to the existence

of the Secretarial Procedures is ripe now, before the |

Secretary has made a substantive determination on a

tribe’s Class III gaming license. We hold that the case

is ripe, the State has standing, and the Secretary

lacked authority to promulgate the regulations. The

district court’s judgment is REVERSED and

REMANDED.

I. BACKGROUND

In the 1980s, various Indian tribes began to

seek authority for legalized gambling as a way to

earn revenue. As sovereigns, Indian tribes are

subordinate only to the federal government.

- California v. Cabazon Band of Mission Indians, 480

U.S. 202, 207, 107 S. Ct. 1083, 1087 (1987). State

laws, however, “may be applied to tnbal Indians on

their reservations if Congress has expressly so

provided.” Id. In Cabazon, the Supreme Court held

that because Congress had not so expressly provided,

California could not enforce certain anti-gambling laws

against an Indian tribe there. Id. at 214, 221-22, 107

S. Ct. at 1091, 1094-95.

In response to Cabazon, Congress enacted the

Indian Gaming Regulatory Act (“IGRA”), 25 U.S.C. §

2701 et _seg., to give states a subordinate but

significant role in regulating tribal gaming. IGRA

separates gaming into classes of escalating stakes.

Class I gaming — social games played for minimal value

— is within the exclusive jurisdiction of the tribes. 25

U.S.C. §§ 2703(6), 2710(a)(1). Class II gaming — bingo

and related activities — is subject to oversight by the

National Indian Gaming Commission. 25 U.S.C. §§

2703(7), 2706(b), 2710(a), (b) & (c). All other forms of

gaming, including high-stakes games such as slot

machines, casino games, lotteries, and dog racing, are

Class III. 25 U.S.C. § 2703(8).

Class III gaming, if authorized by the tribe,

must be “conducted in conformance with a Tribal-State

compact entered into by the Indian Tribe and the

State.” 25 U.S.C. § 2710(d)(1). In IGRA, Congress

meticulously detailed two separate tracks leading to the

institution of a Class III tribal gaming business. On

the first track, the tribe and the state may negotiate

a voluntary compact governing the conduct of gaming

activities, which takes effect essentially upon

approval by the Secretary. § 2710(d)(3)(B).

The second track begins when no compact has

been reached one hundred eighty days after the tribe

requests negotiations. IGRA then allows a tribe to file

suit against the state in federal court and seek a

determination whether the state negotiated in good

faith. § 2710(d)(7). If the court finds the state

negotiated in good faith, the tribe’s proposal fails. On

a finding of lack of good faith, however, the court may

order negotiation, then mediation. If the state

ultimately rejects a court-appointed mediator’s

proposal, the Secretary “shall prescribe, in consulta-

tion with the Indian tribe, procedures . . . under which

class III gaming may be conducted.” § 2710(d)(7)(B).

The Supreme Court held this second track of

the congressional scheme flawed under the Eleventh

Amendment, because Congress has no authority to

abrogate a state’s sovereign immunity from suit under

the Indian Commerce Clause of Article I of the

Constitution. See Seminole Tribe, 517 U.S. at 47, 116

S. Ct. at 1119. Following Seminole Tribe, a state may

waive immunity from suit, or the United States may

sue the state to obtain the statutory good-faith

determination, but a'state cannot be forced to submit to

the tribe’s suit. Seminole Tribe made the second

track toward Class III gaming far more difficult to

pursue.

To work around the decision, the Secretary

promulgated notice-and-comment regulations in

1999. See Class III Gaming Procedures, 25 C.F.R. pt.

291 (“Secretarial Procedures” or “Procedures”). The

Secretarial Procedures only apply if the state asserts

its sovereign immunity and refuses to consent to a

tribe’s statutory good-faith suit. 25 C.F.R. §§ 291.1(b),

291.3. In such event, an eligible tribe may submit a

Class Ill gaming proposal to the Secretary, who then

affords the state sixty days to comment and submit an

alternative proposal. 25 C.F.R. § 291.7. At that point,

the Secretarial Procedures prescribe two tracks

depending on whether the state chooses to submit an

alternative compact proposal.

If the state does not submit an alternative

proposal, the Secretary reviews the tribe’s proposal

and either approves it or offers the opportunity for a

conference between the state and the tribe to address

“unresolved issues and areas of disagreements in the

proposal.” 25 C.F.R. § 291.8. The Secretary must then

make a “final decision either setting forth the

Secretary's proposed Class III gaming procedures for

the Indian tribe, or disapproving the proposal.” Id.

If the state submits an alternative plan, the

Secretary appoints a mediator who, following the

same procedures as IGRA prescribes, will resolve

. differences between the two proposals. 25 C.F.R. §§

291.9, 291.10. While, under the Procedures, the

Secretary may reject the mediator’s proposal, he

“must prescribe appropriate procedures within 60 days

under which Class III gaming may take place.” 25

C.F.R. § 291.11 (emphasis added).

The difference between IGRA and _ the

Secretarial Procedures is that IGRA _ compels

appointment of a mediator by the court only after a

judicial finding that the state failed to negotiate in

yood faith, but under the Secretarial Procedures, the

gaming proposal goes forward without any judicial

bad-faith determination if the state refuses to waive

sovereign immunity. The Secretarial Procedures, in

sum, offer two alternatives for a state that insists

upon its sovereign immunity: refuse to negotiate,

participate (or not) in an informal conference, and take

a chance that the Secretary will not accept the tribe’s

Class III gaming proposal, 25 C.F.R. § 291.8; or

submit its “last best proposal” to a mediator, with the

certainty that Class III gaming must be approved on

the mediator’s or the Secretary’s terms. 25 C.F.R. §

291.11.

In 1995, the Kickapoo Traditional Tribe of

Texas (the “Kickapoo”) petitioned the State to enter

into a compact facilitating Class III gaming on its

land. Texas rejected the Kickapoos’ offer. The tribe’s

federal lawsuit against Texas was eventually

dismissed under Seminole Tribe. In 2004, the

Kickapoo submitted a proposal to the Secretary, who

followed the Secretarial Procedures and invited Texas

to comment. Texas responded with this lawsuit asking

the court to declare the Secretarial Procedures

unauthorized and unconstitutional.

II. STANDARDS OF REVIEW

This court reviews a district court’s legal

conclusions, including the decision whether to grant a

summary judgment motion, de novo. Garcia _v.

LumaCorp, Inc., 429 F.3d 549, 553 (5th Cir. 2005).

Jurisdictional issues such as ripeness and standing,

as well as questions of statutory interpretation, are

also legal questions for which review is de novo. See

Bonds v. Tandy, 457 F.3d 409, 411 (5th Cir. 2006)

(standing); Groome Res. Ltd., L.L.C., v. Parish of

Jefferson, 234 F.3d 192, 198-99 (5th Cir. 2000)

(ripeness); In re Reed, 405 F.3d 338, 340 (5th Cir.

2005) (statutory interpretation). A district court’s

factual findings, including those on which the court

based its legal conclusions, are reviewed for clear error.

See Rivera v. Wyeth-Ayerst Labs., 283 F.3d 315, 319

(5th Cir. 2002).

II. DISCUSSION

The district court determined in a thoughtful

opinion that Texas had standing to sue, but that the

State’s claims were not ripe for adjudication. See

Order on Defendants’ Motion to Dismiss, Kickapoo

Traditional Tribe of Texas v. State of Texas, Cause

No. P-95-CA-66 (W.D. Tex. Apr. 2, 1996). The court

thus dismissed. Nevertheless, it also opined that the

Secretary had implied authority under IGRA and his

general statutory responsibility for Indian tribes to

promulgate the Procedures. Texas v. United States,

362 F. Supp. 2d. 765, 769-70 (W.D. Tex. 2004). The

State appealed. Responding to the parties’ contentions

in this court, we conclude that Texas has standing to

sue, that its case is ripe, and that the Secretarial

Procedures are unauthorized by statute.

A. Justiciability

Appellees first contend that Texas has no

standing to seek invalidation of the Secretarial

Regulations because Texas has suffered no injury from

the mere existence of the Secretarial Procedures and,

in any event, Texas brought any injury on itself by

raising a sovereign immunity defense to the Kickapoo

Tribe’s enforcement suit. Relatedly, Appellees argue

that Texas’s claims are not ripe because any injury

that Texas could suffer from the Procedures would

only manifest if the Secretary were to prescribe

gaming procedures for the tribe at some point in the

future. We disagree with each contention.

The standing and ripeness doctrines flow

largely from Article III of the Constitution, which

limits the federal judicial power to the resolution of

cases and controversies. Valley Forge Christian Coll.

v. Ams. United for Separation of Church and State,

Inc., 454 U.S. 464, 471, 102 S. Ct. 752, 757-58 (1982)

(discussing the underpinnings of standing doctrine).

In general terms, standing is concerned with whether a

proper party is bringing suit, while ripeness is

concerned with whether the suit is being brought at the

proper time. See Elend v. Basham, 471 F.3d 1199, 1205

(11th Cir. 2006). However, the doctrines often overlap

in practice, particularly in an examination of whether

a plaintiff has suffered a concrete injury, see id. at 1205,

and our injury-in-fact analysis draws on precedent for

both doctrines.

1. Standing

“The ‘gist of the question of standing’ is

whether the party seeking relief has ‘alleged such a

personal sta#e in the outcome of the controversy as to

assure that concrete adverseness which sharpens the

presentation of issues upon which the court so largely

depends for illumination of difficult . . . questions.”

Flast v. Cohen, 392 U.S. 83, 99, 88 S. Ct. 1942, 1952

(1968) (quoting Baker v. Carr, 369 U.S. 186, 204, 82

S. Ct. 691, 703 (1962)). To meet the constitutional

standing requirements, (1) the plaintiff must have

suffered an “injury in fact,” defined as an invasion of

a legally protected interest that is (a) concrete and

particularized and (b) actual or imminent, not

conjectural or hypothetical; (2) there must be a causal

connection between the injury and the conduct

complained of, such that the injury is fairly traceable

to the challenged action of the defendant: and (3) it

must be likely, not merely speculative, that the injury

will be redressed by a favorable decision. Lujan v.

Defenders of Wildlife, 504 U.S. 555, 560-61, 112 S.

Ct. 2130, 2136 (1992). Texas, as the party invoking

federal jurisdiction, bears the burden of establishing

that the standing requirements are met. See id. at 561,

1128S. Ct. at 2136.

Texas alleges two ways in which the

Secretarial Procedures have caused it to suffer an

injury in fact, contending first that the existence of the

Secretarial Procedures has reduced the state’s

bargaining power relative to that of the Kickapoo,! and

second that the Secretarial Procedures subject Texas

to a process for approval of Class III gaming that

omits IGRA’s procedural safeguards and thus exceeds

the Secretary’s regulatory authority. The latter

argument, in other words, is that Texas has suffered the

injury of being compelled to participate in an invalid

administrative process, and we agree that standing

exists on this basis.

At the outset of IGRA’s enforcement process, the

statute provides for tribe-initiated court review of a

state’s good faith. Once a tribe makes a prima facie

showing, the state has the opportunity to prove its

good faith to the court and forestall the remainder of

the enforcement process, which includes court-ordered

mediation and possible secretarial approval of gaming

procedures. Texas interprets this as a_ statutory

promise that states will be spared mediation and

' While the Supreme Court has held that the denial of a

“statutory bargaining chip” can “inflict{] a sufficient likelihood

of economic injury to establish standing,” Clinton v. City of New

York, 524 U.S. 417, 432, 118 S. Ct. 2091, 2101 (1998), it is

unclear whether a_ reduction § in_ bargaining’ power

unaccompanied by economic injury or other concrete injury can

constitute an injury in fact. We do not reach this issue because

Texas’s other alleged injury in fact is sufficient to support

standing.

10a

secretarial action unless a court has determined that

the state negotiated in bad faith.

Contrary to Appellees’ suggestion that Texas

faces nothing more than the possibility that the

Secretary might someday approve of gaming

procedures for Kickapoo land, Texas is presently being

subjected to an administrative process involving

mediation and _ secretarial approval of gaming.

procedures even though no court has found that Texas

negotiated in bad faith. Because Texas challenges the

Secretary's authority to undertake this _ process,

Texas has alleged a sufficient injury for standing

purposes. Cf. Thomas v. Union Carbide Agric. Prods.

Co., 473 U.S. 568, 580, 105 S. Ct. 3325, 3332 (1985)

(holding that a challenge to a statutory system of

arbitration was ripe because the plaintiffs’ “injury

[was] not a function of whether the [arbitration]

tribunal awards reasonable compensation but of the

tribunal’s authority to adjudicate the dispute”); Middle

S. Energy Inc. v. Ark. Pub. Serv. Comm’n, 772 F.2d

404, 410 (8th Cir. 1985) (challenge to a state agency’s

ongoing proceedings was ripe because the plaintiff

“challengeld] not the state’s ultimate substantive

decision but its authority to even conduct the

contemplated proceeding”). The alleged injury is not

hypothetical because the Secretarial Procedures have

already been applied to Texas: The Kickapoo Tribe

submitted a Class III gaming application to the

Department of the Interior, the Secretary notified

Texas and the tribe that the application met the

relevant eligibility requirements, and the Secretary

invited Texas to comment on the proposal and submit

lla

an alternative proposal.? Texas’s only alternative to

participating in this allegedly invalid process is to

forfeit its sole opportunity to comment upon Kickapoo

gaming regulations, a forced choice that is _ itself

sufficient to support standing. See Union Carbide, 473

U.S. at 582, 105 S. Ct. at 3333 (recognizing “the

injury of being forced to choose between

relinquishing [the benefit of an unlawful adjudicatory-

process] . . . or engaging in an unconstitutional

adjudication”). As the Supreme Court observed in

Lujan,

[wlhen the suit is one challenging the

legality of government action or inactio..

... [and] the plaintiff is himself-an object

2 In accordance with the Secretaria] Procedures, the Department of

the Interior informed the Kickapoo that their proposal was

completed on December 11, 2003. See 25 C.F.R. § 291.6(b). On

May 24, 2007, the Secretary issued a preliminary “scope-of-

gaming decision” in response to the tribe’s proposal. According

to the Secretary,

[t]he Tribe should be authorized to engage in the

following gaming activities under Class III

procedures pursuant to 25 USC. §

2710(d)(7)(B)(vil(D, subject to the requirements

discussed in [the scope-of-gaming decision]: (1)

traditional casino-style games; (2) any lottery

game including keno, numbers and lotto; and (3)

off-track pari-mutuel betting and pari-mutuel

betting through simulcasting on any gaming

activity occurring off Tribal lands. The Tribe is

not authorized to operate gaming machines.

This recent, preliminary scope-of gaming decision iulustrates the

concrete impact of the choice that the Secretaria] Procedures had

forced Texas to make, as Texas’s decision to forgo this allegedly

invalid process has left it unable to influence important

decisions such as the type of gaming activities that the

Secretary will allow on Kickapoo land.

12a

of the action (or forgone action) at issue . . .

, there is ordinarily little question that

the action or inaction has caused him

injury, and that a judgment preventing or

requiring the action will redress it.

504 U.S. at 561-62, 112 S. Ct. at 2137. We are

satisfied that Texas has alleged an injury in this

case.

The causation and redressability requirements

for standing are satisfied as well. The injury that

Texas claims is directly traceable to the Secretary’s

applying the Secretarial Procedures to Texas, and a

judicial invalidation of the Secretarial Procedures

would give Texas direct relief from being effectively

forced to participate in this process. Although the

United States argues that Texas brought the injury

on itself by invoking a sovereign immunity defense, it

provides no support for the proposition that an injury

cannot be fairly traceable to a defendant if the

plaintiffs acts motivated the defendant to undertake

its injurious acts. The State did not cause the

Secretary of the Interior to promulgate the Secretarial

Procedures, nor did it cause the Secretary to apply the

process to Texas. The State's sovereign immunity

defense is a prerequisite to secretarial action only

because the Secretarial Procedures so provide.

Accordingly, Texas has standing to challenge the

validity of the Secretarial Procedures.

2. Ripeness

[The] basic rationale lof the ripeness

doctrine] is to prevent the courts,

13a

through avoidance of premature

adjudication, from entangling

themselves in abstract disagreements

over administrative policies, and also to

protect the agencies from judicial

interference until an administrative

decision has been formalized and its

effects felt in a concrete way by the

challenging parties.

Abbott Labs. v. Gardner, 387 U.S. 136, 148-49, 87 S. Ct.

1507, 1515 (1967), overruled on other grounds,

Califano v. Sanders, 430 U.S. 99, 97 S. Ct. 980 (1977).

To determine if a case is ripe for adjudication, a court

must evaluate (1) the fitness of the issues for judicial

decision, and (2) the hardship to the parties of

withholding court consideration. See id. at 149. The

fitness and hardship prongs must be balanced, Am.

Forest & Paper Ass’n v. EPA, 137 F.3d 291, 296 (5th

Cir. 1998), and “[a]l case is generally ripe if any

remaining questions are purely legal ones.” New

Orleans Pub. Serv., Inc. v. Council of the City of New

Orleans, 833 F.2d 583, 587 (5th Cir. 1987). Yet “even

where an issue presents purely legal questions, the

plaintiff must show some hardship in order to establish

ripeness.”? Cent. & Sw. Servs. v. EPA, 220 F.3d 683,

590 (5th Cir. 2000).

A challenge to administrative regulations is fit

3 Texas relies on a case from another circuit for the proposition

that hardship is an issue only if a case is not fit for review. See

Fla. Power & Light v. EPA, 145 F.3d 1414, 1421 (D.C. Cir. 1998)

(“When a challenged decision is not ‘fit’ for review, the petitioner

must show ‘hardship’ in order to overcome a claim of lack of

ripeness.”). We need not explore this contention here

l4a

for review if (1) the questions presented are “purely

legal onels],” (2) the challenged regulations constitute

“final agency action,” and (3) further factual

development would not “significantly advance [the

court’s] ability to deal with the legal issues

presented.” Nat'l Park Hospitality Ass’n v. Dep’t of

Interior, 538 U.S. 803, 812, 123 S. Ct. 2026, 2032 (2003)

(internal quotation marks and citations omitted);

Abbott Labs., 387 U.S. at 149-54, 87 S. Ct. 1515-18.

An additional consideration is “whether resolution of

the issues will foster effective administration of the

statute.” Merchs. Fast Motor Lines, Inc. v. ICC, 5

F.3d 911, 920 (5th Cir. 1993); Abbott Labs., 387 U.S.

at 154, 87S. Ct. at 1518.

Appellees do not dispute that the issues involved

in this case are purely legal], but their arguments with

regard to the remaining fitness principles are all

based on the mistaken belief that Texas’s alleged

injury is the speculative harm that could result if the

Secretary were ultimately to approve gaming

procedures for Kickapoo land. As discussed in the

standing inguiry, this is incorrect, as Texas claims

present injury from submission to an invalid agency

process, regardless whether the Secretary ultimately

allows gaming on Kickapoo land.

With this distinction in mind, Texas’s claims are

fit for adjudication. The challenged Secretarial

Procedures are a “final agency action,” as they are

final rules that were promulgated through a formal,

notice-and-comment rulemaking process _ after

announcement in the Federa/ Register. See Abbott

Labs., 387 U.S. at 150-51, 87 S. Ct. at 1516-17.

Additional fact-finding would not aid our inquiry into

15a

the purely legal question of their validity. And

resolution of this issue now will give both the

Secretary and Congress significant guidance into how

IGRA’s provisions may be administered in the

particular situation addressed in this case. Appellees

submit no relevant arguments as to why this issue is

not presently fit for judicial resolution.

We also agree with Texas that it would suffer

hardship if we were to withhold consideration of its

claims. The Supreme Court has found hardship to

inhere in legal harms, such as the harmful creation of

legal rights or obligations; practical harms on the

interests advanced by the party seeking relief; and

the harm of being “forcefd] . . . to modify [one’s]

behavior in order to avoid future adverse

consequences.” Oh. Forestry Ass’n v. Sierra Club, 523

U.S 726, 734, 118 S. Ct. 1671 (1998). Texas faces this

third type of harm. If Texas cannot challenge the

Procedures in this lawsuit, the State is forced to

choose one of two undesirable options: participate in

an allegedly invalid process that eliminates a

procedural safeguard promised by Congress, or eschew

the process with the hope of invalidating it in the

future, which risks the approval of gaming procedures

in which the state had no input. See Abbott Labs., 387

U.S. at 152, 87 S. Ct. at 1517 (finding hardship where

administrative regulations forced the plaintiffs either

to comply with a challenged requirement and incur

significant costs or refuse to comply and risk

prosecution); cf. Union Carbide, 473 U.S. at 581, 105

S. Ct. at 3333 (finding hardship where the plaintiffs

“sufferled] the continuing uncertainty and expense of

depending for compensation on a _ process whose

authority is undermined because its constitutionality

is in question”).

We therefore agree with Texas that its

challenge to the Secretarial Regulations is ripe for

adjudication.

B. Merits

On the merits, to which we now turn, Texas

contends that the Procedures violate the constitutional

separation of powers and nondelegation doctrines and

are contrary to and unauthorized by IGRA or any

other federal statute. To avoid resolution of any

constitutional issues, it is sufficient to consider

whether the Procedures are authorized by IGRA or

the general Indian trust statutes under the Chevron

test.

1. Statutory Background

To put this dispute in clearer perspective, one

must recall that although = states have no

constitutional authority over Indian _ reservations,

Congress had consistently authorized states to regulate

or prohibit certain activities on the reservations. The

Supreme Court significantly altered the assumed

state-tribal relationship when, in the 1987 Cabazon

Band decision, it expansively interpreted a federal

statute to prevent states from prohibiting certain

tribal gambling activities.

Congress responded to Cabazon Band by

finishing work on IGRA, a gambling-enabling statute

for Indian reservations that had been pending in the

legislative process for several years. It is unnecessary

to repeat our previous summary of the statute’s complex

provisions. Suffice it to say that among those

17a

provisions is a “carefully crafted and intricate

remedial scheme” whereby, if a tribe and state do

not voluntarily enter a compact for Class II] gaming,

the principal alternative is for the tribe to sue the state

in federal court and secure a determination that the

state had not negotiated in good faith.5 25 U.S.C. §

2710(dX7)(A)G). What constitutes good-faith

negotiating by the state is left unexplained. An easy,

minimal inference is that a state’s insistence upon its

general policy against legalized Class III gambling

would constitute “good faith,” but that determination,

along with numerous other issues such as the

necessary “fit” between a state’s policy and the scope

of Class III gaming sought by a tribe, is left to a

federal court — a clearly neutral forum. Under IGRA,

a federal court finding that the state negotiated in

good faith ends the bargaining process. On a finding

of lack of good faith, however, the court may order

negotiation, § 2710(d)(7)(B)Gii), then mediation. §

2710(d)(7)(B)Gv). The court appoints a mediator. If a

state refuses to consent to the mediator’s proposed

compact (which must blend the “last best offers” of

each party), the Secretary is then authorized to

prescribe procedures that will bind the _ state.

Moreover, the Secretary must adopt procedures

“consistent with the [mediator’s] proposed compact . . .

.” § 2710(d)(7)(B)(vii)(I). This statutory balance on its

face cabins the Secretary’s authority while

implanting neutral factfinders on the decisive

questions of good faith and the final imposition of a

compact on an unwilling or uncooperative state.

4 Seminole Tribe, 517 U.S. at 73-74, 116S. Ct. at 1132.

5 Even after Seminole Tribe, the federal government may sue a

state on behalf of a tribe to pursue [IGRA’s remedial process

without jurisdictional impediment.

18a

Absent the Seminole Tribe decision, this remedial

plan is self-contained and fully sufficient. No one

contends that the Secretary could have promulgated

his alternative Procedures under IGRA before

Seminole Tribe was decided. Nonetheless, the

Appellees insist that IGRA implicitly conferred on the

Secretary the power to substitute the Secretarial

Procedures for the judicial remedy foreclosed by

Seminole Tribe. This court must therefore move into

the realm of the Chevron doctrine to determine

whether the Secretarial Procedures faithfully

interpret IGRA or, as the Appellees also assert, the

general Indian trust statutes. See Class HI Gaming

Procedures, 64 Fed. Reg. 17,535-02, 17,536 (Apr. 12,

1999) (Secretary asserts authority to prescribe the

Procedures based on the statutory delegation of powers

contained in 25 U.S.C. § 2710(d)(7)(B)(vii) of IGRA and

25 U.S.C. §§ 2 and 9).

2. Chevron Step-One Analysis

The authority of administrative agencies is

constrained by the language of the statute they

administer. See Massachusetts v. EPA, _ U.S._, 127

S. Ct. 1438, 1462 (2007). Under the Chevron doctrine,

courts assess the validity of challenged administrative

regulations by determining whether (1) a statute is

ambiguous or silent concerning the scope of

secretarial authority and (2) the regulations

reasonably flow from the statute when viewed in context

of the overall legislative framework and the policies that

animated Congress’s design. See Chevron, U.S.A., Inc.

v. Natural Res. Def. Council, Inc., 467 U.S. 837, 842-

43, 1048S. Ct. 2778, 2781-82 (1984).

Under Chevron step one, the inquiry is “whether

Congress has directly spoken to the precise question at

issue.” Id. at 842, 104 S. Ct. at 2781. Judicial deference

is due only “if the agency interpretation is not in

conflict with the plain language of the statute.” Nat'l

R.R. Passenger Corp. v. Boston & Maine Corp., 503

U.S. 407, 417, 112 S. Ct. 1394, 1401 (1992) (citing K

Mart Corp. v. Cartier, Inc., 486 U.S. 281, 292, 108 S.

Ct. 1811, 1818 (1988)). Step one includes challenges

to an agency’s interpretation of a statute, as well as

whether the statute confers agency jurisdiction over

an Issue. See generally FDA v. Brown & Williamson

Tobacco Corp., 529 U.S. 120, 120 S. Ct. 1291 (2000).

“Regardiess of how serious the problem an

administrative agency seeks to address, however, it

may not exercise its authority ‘in a manner that is

inconsistent with the administrative structure that

Congress enacted into law.” Id. at 125, 120 S. Ct. at

1297 (quoting ETSI Pipeline Project v. Missouri, 484

U.S. 495, 517, 108 S. Ct. 805, 817 (1988)).6

As was shown above in our discussion of the

statute, the plain language of IGRA permits limited

secretarial intervention only as a last resort, and only

after the statute’s judicial remedial procedures have

been exhausted. See 25 U.S.C. § 2710(d)(7)(B)G)-(vi).

Congress did not explicitly authorize the Secretarial

® Additionally, courts “must be guided to a degree by common

sense as to the manner in which Congress is likely to delegate a

policy decision of such economic and political magnitude to an

administrative agency.” Chevron, 467 U.S. at 133, 120 S. Ct. at

1301.

20a

Procedures. Under Chevron step one, when, as here,

“the statute is clear and unambiguous, that is the

end of the matter; for [this] court, as well as the

agency, must give effect to the unambiguously

expressed intent of Congress.” K Mart, 486 U.S. at

291, 108 S. Ct. at 1817 (quoting Bd. of Governors of

the Fed. Reserve Sys. v. Dimension Fin. Corp., 474

U.S. 361, 368, 106 S. Ct. 681, 685 (1986)); Chevron,

467 U.S. at 842-48, 104 S. Ct. at 2781-82.7

Chevron deference “comes into play, of course,

only as a consequence of statutory ambiguity, and then

only if the reviewing court finds an implicit delegation

of authority to the agency.” Sea-Land Serv., Inc. v.

Dep’t of Transp., 137 F.3d 640, 645 (D.C. Cir. 1998)

(citing Chevron, 467 U.S. at 842-44, 104 S. Ct. at 2781-

83): Thus, even if there were an ambiguity concerning

whether IGRA permits the Secretarial Procedures

without exhaustion of its _ judicially-controlled

remedy, an equally salient fact is that “[mlere

ambiguity in ae_e statute is not evidence of

congressional delegation of authority.” Michigan v.

EPA, 268 F.3d 1075, 1082 (D.C. Cir. 2001)(citing

7 It is noteworthy that the “Indian canon” of statutory

construction has no bearing on this case because IGRA

unambiguously defines the scope of secretarial authority and

the conditions under which such authority may be lawfully

exercised. See Negonsott v. Samuels, 507 U.S. 99, 110, 113 S. Ct.

1119, 1125-26 (1993) (courts do not “resort to [the Indian] canon

of statutory construction” when a statute is unambiguous (citation

omitted)); Cabazon Band of Mission Indians v. Nat'l Indian

Gaming Comm’n, 14 F.3d 633, 637 (D.C. Cir. 1994) (‘When the

statutory language is clear, as it is here, the [Indian] canon may not

be employed.”).

2ila

cases); Montana v. Clark, 749 F.2d 740, 745 (D.C. Cir.

1984) (“[D]eference to an agency’s interpretation

constitutes a judicial determination that Congress

has delegated the norm-elaboration function to the

agency and that the interpretation falls within the

scope of that delegation.” (emphasis in original)

(citation omitted)). The Appellees’ argument attempts

to obviate Chevron’s delegation requirement by

contending that, despite IGRA’s’ meticulous

description of the protracted remedial prelude to the

Secretary’s involvement in approving Class III

gaming without a state’s consent, this court can

nonetheless discover a silent, or “implicit,” delegation

of secretarial authority. That is, Appellees contend that

even though Congress specifically addressed the

circumstances under which secretarial authority can

be exercised — and even though those circumstances

are absent here — the Secretary’s actions are

justifiable because IGRA does not explicitly address

the Eleventh Amendment issue that arose in the

wake of Seminole Tribe.

Courts encountering this kind of “whatever-it-

takes” approach to Chevron analysis in the past have

rejected it. See, e.g., Platte River Whooping Crane

Critical Habitat Maint. Trust v. FERC, 962 F.2d 27, 33

(D.C. Cir. 1992) (appeals to a statute’s broad purposes

do not allow the discovery of implicit delegations of

authority when Congress has explicitly delineated the

boundaries of delegated authority). When Congress

has directly addressed the extent of authority

delegated to an administrative agency, neither the

agency nor the courts are free to assume that Congress

intended the Secretary to act in situations left

unspoken. See Nat’l R.R. Passenger Corp. v. Nat'l

22a

Ass'n of R.R. Passengers, 414 U.S. 453, 458, 94S. Ct.

690, 693 (1974) (“When a statute limits a thing to be

done in a particular mode, it includes the negative of

any other mode.” (quoting Botany Worsted Mills v.

United States, 278 U.S. 282, 289, 49 S. Ct. 129, 132

(1929))).8 Accordingly, administrative agencies and

the courts are “bound, not only by the ultimate

purposes Congress has selected but by the means it

has deemed appropriate, and prescribed, for the

pursuit of those purposes.” MCI Telecomm. Corp. v.

AT&T Corp., 512 U.S. 218, 231 n.4, 114 S. Ct. 2223,

2232 n.4 (1994) (emphasis added).

Thus, at the heart of the Appellees’ delegation

argument is the assumption that since Congress did

not explicitly withhold secretarial rulemaking

authority in the event that a tribe is unable to obtain

a judicial determination of the state’s bad faith, the

ensuing congressional “silence” creates an implicit

delegation under Chevron to promulgate Class III

gaming regulations.

That is an inaccurate interpretation of the nature

of the delegation inquiry under Chevron’s first step.

“Agency authority may not be lightly presumed.”

Michigan, 268 F.3d at 1082. “Were courts to presume

a delegation of power absent an express withholding

of such power, agencies would enjoy virtually limitless

hegemony, a result plainly out of keeping with

8 See also Pub. Serv. Comm. of State of N.Y. v. FERC, 866 F.2d

487, 491-92 (D.C. Cir. 1989) (executive agencies “cannot enlarge

the choice of permissible procedures beyond those that may

fairly be implied from the substantive sections and the functions

there defined”).

23a

Chevron and quite likely with the Constitution as

well.” Ethyl Corp. v. EPA, 51 F.3d 1053, 1060 (D.C.

Cir. 1995); Michigan, 268 F.3d at 1082.9 It stands to

reason that when Congress has made an explicit

delegation of authority to an agency, Congress did not

intend to delegate additional authority sub _silentio.

See Backcountry Against Dumps v. EPA, 100 F.3d

147, 151 (D.C. Cir. 1996) (finding that explicit

congressional delegation of authority precludes an

implicit delegation more expansive than Congress’s

express terms). Courts recognize an implicit delegation

of rulemaking authority only when Congress has not

spoken directly to the extent of such authority, or has

“intentionally left [competing policy interests] to be

resolved by the agency charged with administration of

the statute.” Chevron 467 U.S. at 865-66, 104 S. Ct. at

2793.

In IGRA, Congress plainly left little remedial

authority for the Secretary to exercise. The judicially-

managed scheme of good-faith litigation, followed by

negotiation, then mediation, allows the Secretary to

step in only at the end of the process, and then only to

adopt procedures based upon the mediator’s proposed

compact. The Secretary may not decide the state’s

9 Nor can congressional! silence on an issue be used as a panacea

justifying rulemaking authority untethered from any trace of

congressional intent. “To suggest, as the [Secretary] effectively

does, that Chevron step two is implicated any time a statute does

not expressly negate the existence of a claimed administrative

power .. . is both flatly unfaithful to the principles of

administrative law and refuted by precedent.” Am. Bar Ass'n v.

FTC, 430 F.3d 457, 468 (D.C. Cir. 2005) (quoting Ry. Labor

Executives’ Ass'n v. Nat’ Mediation Bd., 29 F.3d 655, 671 (D.C.

Cir. 1994) (en banc) (emphasis in criginal)).

24a

good faith; may not require or name a mediator; and

may not pull out of thin air the compact provisions

that he is empowered to enforce. To infer from this

limited authority that the Secretary was implicitly

delegated the ability to promulgate a _ wholesale

substitute for the judicial process amounts to logical

alchemy.

Citing Seminole Tribe, Appellees further

contend that a judicial decision can, ex post facto,

create a Chevron-type “gap” that introduces ambiguity

into the operation of a statutory scheme and thereby

authorizes an administrative agency to step in and

remedy the ambiguity. This claim ignores Chevron’s

well-established requirement that any delegation-

engendering gap contained in a statute, whether

implicit or explicit, must have been “left open by

Congress,” not created after the fact by a court.

Chevron, 467 U.S. at 866, 104 S. Ct. at 2793

(emphasis added).1°

10 Moreover, no other circuit court to have considered the propriety

of the Secretarial Procedures in light of IGRA has discovered the

statutory gap purportedly created by Seminole Tribe. The

Eleventh Circuit has suggested without any analysis that if a

state asserted Eleventh Amendment immunity against a tribe’s

lawsuit, the judicial good-faith determination was severable and

unnecessary, and the Secretary could simply enforce against the

state regulations governing Class III gaming. See Seminole Tribe of

Fla. v. Florida, 11 F.3d 1016, 1029 (11th Cir. 1994), aff'd, 517

U.S. 44, 116 S. Ct. 1114 (1996). A close reading of the Eleventh

Circuit’s decision, however, demonstrates that it meant to allow

the Secretary to proceed under IGRA as if a judicial finding of lack

of good faith had been made and a court-appointea mediator

failed to bring the parties to terms. See id. (citing §

2710(d)(7)(B)vii) as the basis for the Secretarial Procedures).

Nowhere does the Eleventh Circuit claim that a state’s exercise of

25a

Although later enacted statutory provisions

may be relevant to determine congressional intent for

purposes of Chevron ambiguity, see Brown &

Williamson, 529 U.S. at 143-44, 120 S. Ct. at 1306-07,

there is no support for the proposition that later court

decisions affect or effect ambiguity. Chevron’s

delegation inquiry gauges congressional intent that 1s

independent from subsequent administrative or

judicial constructions of a statute. See Natl Cable &

Telecomm. Ass’n v. Brand X Internet Servs., 545 U.S.

967, 982, 125 S. Ct. 2688, 2700 (2005)“[W]hether

Congress has delegated to an agency the authority to

interpret a statute does not depend on the order in

which the judicial and administrative constructions

occur.”); see also Bowen v. Georgetown Univ. Hosp.,

488 U.S. 204, 208, 109 S. Ct. 468, 471 (1988)(“‘It is

axiomatic that an administrative agency’s power to

promulgate legislative regulations is limited to the

authority delegated by Congress.”). Accordingly, even

though court interpretation of IGRA produced the

unexpected result that a state may “veto” Class III

gaming by exercising its Eleventh Amendment

sovereign immunity, that outcome has no bearing on

the scope of the administrative authority originally

delegated by Congress to the Secretary.

When it so desires, Congress has the power to

Eleventh Amendment sovereign immunity creates a statutory

gap. Likewise, considering IGRA in the wake of the Supreme

Court’s Seminole Tribe decision, the Ninth Circuit reaffirmed the

centrality of the statutory balancing of interests in IGRA’s

remedial scheme, yet did not mention the apparent gap

Appellees claim was created by the Supreme Court. See United

States v. The Spokane Tribe of Indians, 139 F.3d 1297, 1299-

1300 (9th Cir. 1998).

26a

confer expansive interpretive authority on agencies to

accommodate changing or unpredictable

circumstances. See, e.g., Massachusetts, _ U.S. at_,

127 S. Ct. at 1462 (“The broad language of [Clean Air

Act] § 202(a)(1) reflects an intentional effort to confer

flexibility necessary to forestall . . . obsolescence.”).

Likewise, Congress knows well how to cabin agency

authority through specific definitions that pretermit

flexible interpretation. See, e.g., Ethyl Corp., 51 F.3d

at 1058 (Congress unambiguously expressed that

waiver decisions made under Clean Air Act § 211(f)(4)

are based exclusively on one criterion). However, the

fact that later-arising circumstances cause a statute

not to function as Congress intended does not expand

the congressionally-mandated, narrow scope of the

agencys power. For example, in evaluating the

validity of the Federal Reserve’s interpretation of the

Bank Holding Company Act in Dimension Financial,

the Supreme Court observed that:

Congress defined with specificity certain

transactions that constitute banking

subject to regulation. The statute may be

imperfect, but the [Federal Reserve] Board

has no power to correct flaws that it

perceives in the statute it is empowered

to administer. Its rulemaking power is

limited to adopting regulations to carry

into effect the will of Congress as

expressed in the statute. If the Bank

Holding Company Act falls short of

providing safeguards desirable’ or

necessary to protect the public interest,

that is a problem for Congress, not that

Board or the courts, to address.

27a

Dimension Fin. at 374-75, 106 S. Ct. at 689.1! In

strikingly similar terms, the Seminole Tribe Court

rejected Florida’s invitation to prescribe a remedy

unsupported by the language and legislative history

of IGRA. 517 U.S. at 76, 116 S. Ct. at 1133 (“Nor are

we free to rewrite [IGRA’s] statutory scheme in order to

approximate what we think Congress might have

wanted had it known that § 2710(d)(7) was beyond its

authority. If that effort is to be made, it should be

made by Congress, not by the federal courts.”).2

11 Under the Chevron analysis, the question is whether

Congress could be said to have delegated explicit or implicit

authority to the agency to deal with an issue. We focus here on

implicit delegation since IGRA indisputably does not address the

post-Seminole Tribe state of affairs. The Dissent suggests that

Congress effects an implicit delegation of legislative authority

‘each time it decides an issue and withholds power from the agency

in so doing. Following this ungainly line of reasoning to its

conclusion, the Dissent would hold that any time a court

overturns a statute speaking expressly to an administrative issue,

the agency has been delegated de facto implicit authority to revise

the procedure as it sees fit. That result stands Congress’s

exertion of power on it head, transforms a denial of agency

authority into an implicit delegation thereto, and radically

undercuts the Supreme Court's attempt in Chevron to distinguish

between congressional power and agency authority in a

principled way. In the Indian gaming context, Congress reacted

to the Cabazon Band decision by adopting a highly complex

scheme to balance the tribal-state interests inherent in Indian

gaming. Congress could have simply authorized the Secretary to

promulgate compacts however he chose to do so, or, it could

have refrained from acting entirely. It took neither route.

Instead, it explicitly withheld power from the Secretary to

accomplish IGRA’s balancing scheme. As Dimension Financial

states, no court decision can restore power that was withheld by

Congress.

12 This comment was made in the context of the Supreme

Court's rejection of a judicially crafted Ex Parte Young remedy

— not the Secretarial Procedures at issue in this appeal. But

28a

Nor does the fact that judicial interpretation of

a statute leads to consequences unforeseen by Congress

make a statute “ambiguous” within the meaning of

Chevron. See, e.g., Exxon Mobil Corp. v. Allapattah

Servs., Inc., 545 U.S. 546, 567, 125 S. Ct. 2611, 2625

(2005)(rejecting legislative history that might have

demonstrated Congress “did not intend” to overrule a

case because the statutory language was

unambiguous that Congress did in fact overrule the

case); In re Abbott Labs., 51 F.3d 524, 528-29 (5t Cir.

1995) (applying the plain meaning of a statute even

though that construction “may have been a clerical

error’); see also Thompson v. Goetzmann, 337 F.3d

489 (5th Cir. 2003). In Thompson,the Department of

Health & Human Services sought deference for its

interpretation of a particular term, as construed in the

applicable regulations and in its lawsuit for Medicare

reimbursement. The court stated:

[Wle reiterate that the courts are not in the

business of amending legislation. If the

Dlain language of the MSP statute

produces the legislatively unintended

result claimed by the government, the

Florida’s proposed Ex Parte Young remedy was rejected by the

Supreme Court because, like the Secretarial Procedures, it was

contrary to the “carefully crafted and intricate remedial scheme

set forth in § 2710(d)(7)” by Congress. Seminole Tribe, 517 U.S.

at 73-74, 116 S. Ct. at 1132. The Supreme Court’s reason for

rejecting the Ex Parte Young remedy thus applies with equal

force to the Secretarial Procedures here. Nevertheless, we

acknowledge that the Court explicitly refused to consider the

Eleventh Circuit's “suk stitute remedy” of Secretarial Procedures.

Id. at 76, 116 S. Ct. at 1133: see also 517 U.S. 1133, 116 S. Ct.

1416 (1996) (mem.).

29a

government's complaint should _ be

addressed to Congress, not to the courts,

for such revision as Congress may deem

warranted, if any.

Id. at 493. Court decisions cannot serve to dilate

or contract the scope of authority delegated by

Congress to an administrative agency because

delegation is a matter of legislative intent, not

judicial interpretation. Thus, if Congress did

not originally intend to confer rulemaking

authority, the Secretary cannot synthesize that

authority from a judicial opinion.}3

13 The United States’ analogy to the Coal Act cases fails to lend

support to its endorsement of the unauthorized actions Interior has

taken in this case. The Fourth Circuit’s decision in The Pittston

Co. v. United States, 368 F.3d 385 (4th Cir. 2004), stands only

for the proposition that an administrative agency’s

interpretation of a statute in light of a subsequent judicial

decision may be permissible if that interpretation is (1) faithful

to the authority Congress originally delegated to the agency and

(2) does not contradict the plain langmage of the statute. That

uncontroversial stance shares our view that the scope of authority

delegated by Congress to an administrative agency is not altered

by subsequent developments. See, e.g., Brand X, 545 U.S. at 983,

125 S. Ct. at 2700. As the Pittston court recognized, the

beneficiary reassignments undertaken by the Social Security

Commissioner in the wake of Eastern Enterprises v. Apfel, 524

U.S. 498, 118 S. Ct. 2131 (1998), did not “violate[] or disturb{] the

structure of the Coal Act .. . . [The Commissioner] followed the

Coal Act’s assignment structure to the letter. . . . [Tlhe fact and

method of applying the Coal Act .. . have not changed.” 368 F.3d at

404-05; see also A.T. Massey Coal Co. v. Holland, 472 F.3d 148,

167 (4th Cir. 2006) (“[D]elegation must appear from the statute

itself, not from the agency’s actions”); Sidney Coal Co. v. Soc. Sec.

Admin., 427 F.3d 336, 347 n.15 (6th Cir. 2005). The same cannot

be said of the Secretary’s actions. In stark contrast to the

Commissioner's reassignments in Pittston, here the Secretary

did not promulgate Class III gaming regulations that correspond to

30a

3. Reasonabieness of Secretarial

Procedures Under Chevron’s Step Two

Even were we to conclude under the Chevron

step-one analysis that Seminole Tribe effected a sub

rosa delegation of administrative authority allowing

the Secretary to ignore Congress’s explicit limitation

of his authority in § 2710(d)(7)(B)(vii), the

Secretarial Procedures still cannot pass muster under

Chevron step two because they do not reasonably

effectuate Congress’s intent for IGRA. “If [the

agency’s] choice represents a reasonable

accommodation of conflicting policies that were

committed to the agency’s care by the statute,” a court

will not disturb that choice “unless it appears from

the statute or legislative history that’ the

accommodation is not one that Congress would have

sanctioned.” Chevron, 467 U.S. at 845, 104 S. Ct. at

2783 (quoting United States v. Shimer, 367 U.S. 374,

382-83, 81 S. Ct. 1554, 1560-61 (1961)); see also

United States v. Riverside Bayview Homes, Inc., 474

U.S. 121, 131, 106 S. Ct. 455, 462 (1985) (Chevron step

two entails evaluation of agency action “in light of the

language, policies and legislative history of the Act.”).

the structure of IGRA. Instead, the Secretary has erected an

ersatz remedial scheme that exceeds the authority Congress

delegated to the Secretary under IGRA’s remedial provisions.

Pittston does not support the creation of a novel remedial

scheme never envisioned by Congress and _ specifically

contradictory of Congress’s expressed intent concerning the

scope of secretarial rulemaking. The application of a preexisting

remedial scheme to a narrower pool of plan participants that

was approved in Pittston is not remotely analogous to the

wholesale invention of the remedial scheme that we are

confronted with in the Secretarial Procedures. Pittston lends no

support for the unprecedented “yapfilling” that the Secretary has

undertaken in this case.

3la

In any event, “[plolicy considerations cannot override

our interpretation of the text and structure of the

Act.” Cent. Bank of Denver, N.A., v. First Interstate

Bank of Denver, N.A., 511 U.S. 164, 188, 114 S. Ct.

1439, 1453-54 (1994). “The judiciary is the final

authority on issues of statutory construction and must

reject administrative constructions which are

contrary to clear congressional intent.” Chevron, 467

USS. at 843 n.9, 104 S. Ct. at 2782 n.9. Thus, as with

the delegation inquiry, Chevron step two compels a

judicial evaluation of congressional intent. Because the

Secretary’s actions clearly violate IGRA’s intent, they

are unreasonable.

In IGRA, Congress struck a “finely-tuned balance

between the interests of the states and the tribes” to

remedy the Cabazon Band prohibition on _ state

regulation of Indian gaming. United States v.

Spokane Tribe of Indians, 139 F.3d 1297, 1301 (9th

Cir. 1998); S. REP. No. 100-446, at 2 (1988), as

reprinted in 1988 U.S.C.C.A.N. 3071, 3071-72 (noting

Cabazon Band’s holding that tribes “have a right to

conduct gaming activities on Indian lands unhindered

by State regulation”). Congress attempted to “provide

a means by which tribal and State governments can

realize their unique and individual governmental

objectives” by giving tribes the opportunity to negotiate

a Class III gaming compact, and by giving states the

protection of an objective judicial intermediary in case

negotiations prove unsuccessful. S. REP. NO. 100-446, at

13 (1988), as reprinted in 1988 U.S.C.C.A.N. 3071,

3083.

The lynchpin of IGRA’s balancing of interests

is the tnbal-state compact. Melding the provisions for

32a

negotiation of a compact with the remedial structure

ultimately included in IGRA took over five years to

accomplish legislatively.14 § Moreover, IGRA’s

legislative history amply demonstrates that Congress

viewed the compact as an indispensable prerequisite

to Class III gaming. See id. at 6, as reprinted in 1988

U.S.C.C.A.N. 3071, 3076 ({IGRA] does not

contemplate and does not provide for the conduct of

Class III gaming activities on Indian lands in the

absence of a tribal-State compact”); id. (“tribes will be

unable to enter into [Class III] gaming unless a

compact is in place”). Congress considered — and

rejected — other remedial structures that did not

guarantee states such protections. The legislature

eventually settled on IGRA’s judicial remedy and the

tribal-state compact requirement as the “best

mechanism to assure that the interests of both

sovereign entities are met with respect to the

regulation of complex gaming enterprises.” Id. at 13,

as reprinted in 1988 U.S.C.C.A.N. 3071, 3083.

Congressional intent on this score is pellucid. In

order to conduct Class III gaming, tribes must either:

(1) negotiate a voluntary compact with the state, see

25 U.S.C. § 2710(d)(3)(A)-(C); (2) obtain the state’s

agreement to the mediator-selected compact that

follows the judicial good-faith process, see §

2710(d)(7)(B)Gii)-(vi); or (3) obtain secretarial Class

III procedures based on the mediator-selected

compact, see § 2710(d)(7)(B)(vii)(1). Absent a tribal-

'4 The legislation to enable Indian gaming was first introduced

as H.R. 4566, 97th Cong. (1983), by Representative Morris Udall

in 1983. S. 555, 100th Cong. (1988), introduced by Senator Daniel

Inouye, was enacted into law as IGRA in 1988.

33a

state compact, the statute forbids tribes to offer Class

IIJ gaming.

The tribal-state compact is in fact so central to

the IGRA process that it is the only means by which the

tribe can avoid incurring liability under other federal

statutes that regulate Indian gaming. Two statutes,

both of which antedate IGRA, are relevant to this

issue. First, the Johnson Act, 15 U.S.C. § 1175 et

seq., prohibits the possession or use of “any gambling

device . . . within Indian country.” Id. § 1175(a).

Second, 18 U.S.C. § 1166 punishes gambling in Indian

country in derogation of state law. Congress

coordinated IGRA with these criminal provisions by

providing that the tribal-state compact is the exclusive

means of avoiding gaming-related violations.!5 Apart

from the limited circumstances in which IGRA allows

Class III gaming to be imposed by the Secretary

following exhaustion of the judicial good-

faith/mediation process, Class III gaming remains illegal

in Indian country without a tribal-state compact.

The role the Secretary plays and the power he

wields under the Procedures bear no resemblance to

the secretarial power expressly delegated by Congress

under IGRA. First, IGRA interposes, before any

15 See IGRA § 2710(d)(6) Wohnson Act does not apply to gaming

conducted under a tribal-state compact); see also United States

v. Cook, 922 F.2d 1026, 1034 (2d Cir. 1991) Wohnson Act

liability waived only by a Class III gaming compact between a

state and tribe). Likewise, 18 U.S.C. § 1166(c)(2), referencing

IGRA, excepts “class II] gaming conducted under a Tribal-State

compact.” See, e.g., Mashantucket Pequot Tribe v. Connecticut,

913 F.2d 1024, 1031 (2d Cir. 1990) (tribal-state compact required

for waiver of 18 U.S ©. § 1166 liability).

34a

secretarial involvement, the requirement that an

impartial factfinder determine whether the state has

negotiated in good faith. See § 2710(d)(7)(B)Gii).

Under the Secretarial Procedures, however, it

matters not that a state undertook good-faith

negotiations with the tribe: The Secretary may

prescribe Class III gaming irrespective of a state’s

good faith. See 25 C.F.R. § 291.7-.8. This result

contravenes the plain language of IGRA.

Second, under IGRA, if mediation is ordered, it

is undertaken by a neutral, judicially-appointed

mediator who objectively weighs the proposals

submitted by the state and _ tribe. See §

27710(d)(7)(B)(iv). Under the Procedures, however, the

Secretary selects the mediator. 25 C.F.R. § 291.9. In

light of the Secretary’s statutory trust obligation to

protect the interests of Indian tribes, this aspect of the

Procedures is stacked against the objective interest-

balancing Congress intended and creates the strong

impression of a biased mediation process. See, e.g.,

Kickapoo Tribe of Indians of Kickapoo Reservation in

Kan. v. Babbitt, 43 F.3d 1491, 1499 (D.C. Cir. 1995)

(noting that “the Secretary was not in a position to

champion the State’s position in view of his trust

obligations to the tribe.” (citing Heckman v. United

States, 224 U.S. 413, 444-45, 32 S. Ct. 424, 433-34

(1912))). Common sense dictates that the Secretary

cannot play the role of tribal trustee and objective

arbiter of both parties’ interests simultaneously.

Congress did not intend this incoherent result.

Third, whereas under IGRA’s remedial scheme

the court-appointed mediator essentially defines the

regulations that the Secretary may promulgate, the

35a

Procedures enable the Secretary to disregard not only

the mediator’s proposal, but also the proposals of the

state and tribe.16 IGRA’s remedial process makes clear

that Congress did not intend to delegate to the

Secretary unbridled power to prescribe Class III

regulations.

Fourth, the Secretarial Procedures contemplate

Class III gaming in the absence of a tribal-state

compact — directly in derogation of Congress’s

repeated and emphatic insistence. See, e.g., S. REP.

No. 100-446, at 6 (1988), as reprinted in 1988

U.S.C.C.A.N. 3071, 3076 (“[IGRA] does not contemplate

and does not provide for the conduct of class III

gaming activities on Indian lands in the absence of a

tribal-State compact.”).17 The only exception to the

compact requirement Congress envisioned was the

promulgation of procedures after a_ bad-faith

determination and in concert with the proposal

16 Compare § 2710(d)(7)(B)(vii) (“the mediator shall notify the

Secretary and the Secretary shal! prescribe . . . procedures (I)

which are consistent with the proposed compact selected by the

mediator under clause (iv)) with 25 C.F.R. § 291.11(c) (“If the

Secretary rejects the mediator’s proposal . . . he/she must

prescribe appropriate procedures within 60 days under which

“ass III gaming may take place that comport with the

mediator’s selected proposal as much as possible, the provisions of

IGRA, and the relevant provisions of the laws of the State.”).

17 Department of the Internor and Related Agencies

Appropriations Act, Pub. L. No. 105-83, 111 Stat. 1543, 1570

(1998) (“SENSE OF THE SENATE CONCERNING INDIAN

GAMING. It is the sense of the Senate that the United States

Department of Justice should vigorously enforce the provisions

of the Indian Gaming Regulatory Act requiring an approved

Tribal-State gaming compact prior to the initiation of class III

gaming on Indian lands.”)

36a

selected by a court-appointed mediator. Yet in spite of

this single statutory exception — the product of

IGRA’s complex and balanced remedial scheme —

Appellees maintain it is equally reasonable to assume

that Congress intended a waiver of hability under the

Johnson Act and 18 U.S.C. § 1166 even without a

judicial determination of bad faith; without the

participation of a court-appointed mediator; and

without the requirement that the _ regulations

ultimately promulgated be “consistent with the proposed

compact selected by the (court-appointed)

mediator.” § 2710(d)(7)(b)(vil)(D).18

For all these reasons, the Secretary’s Class III

Procedures are not a reasonable interpretation of

'8 Commentators have noted the problems with the Procedures.

See Rebecca S. Lindner-Cornelius, Note, The Secretary of the

Interior as Referee: The States, The Indian Nations, and_How

Gambling Led to the Illegality of the Secretary of the Interior’s

Regulations in 25 C.F.R. § 291, 84 MARQUETTE L. REV. 685, 695

(2001) (arguing that the regulations are unconstitutional and

noting that “when a state claims it has negotiated in good faith to

no avail, the only recourse it is left with is a biased factfinder who

can do what it wants without any state input”); Nicholas S. Goldin,

Note, Casting a New Light on Tribal Casino Gaming: Why

Congress Should Curtail the Scope of High Stakes Indian

Gaming, 84 CORNELL L. REV. 798, 843-44 (1999) (arguing that the

Procedures are “troubling” because the Secretary “assumes a

massive unilateral power that Congress did not intend to

delegate” and because the Procedures “make a travesty of the

concept of federalism and in its place substitute a system in which

Washington claims it knows best what state laws mean”); Joe

Laxague, Note, Indian Gaming and Tmnbal-State Negotiations:

Who Should Decide the Issue of Bad Faith?, 25 J. LEGIS. 77, 91

(1999) (arguing that the Procedures “do both parties a disservice

and badly skew the balance of interests intended by Congress

when it wrote the IGRA”).

37a

IGRA, especially when viewed against “their place in

the overall statutory scheme.” Brown & Williamson,

529 U.S. at 133, 120 S. Ct. at 1301. The Secretary, of

course, is not authorized to promulgate regulations in

violation of federal law, see Sohappy v. Hodel, 911

F.2d 1312, 1320 (9th Cir. 1990), yet the Secretarial

Procedures stand in direct violation of IGRA, the

Johnson Act, and 18 U.S.C. § 1166 insofar as they

may authorize Class III gaming without a compact.

Because “the Executive Branch is not permitted to

administer the Act in a manner that is inconsistent

with the administrative structure that Congress

enacted into law,” and because doing so constitutes

an unreasonable interpretation of Congress's intent,

the Secretarial Procedures cannot pass muster under

Chevron step two. ETSI Pipeline Project, 484 U.S. at

157, 108 S. Ct. at 817.

4. General Authority Statutes

An alternative contention raised by Appellees

is that secretanal authority to promulgate the

Procedures derives from the general Indian trust

statutes when read in_ concert with = §

2710(d)(7)(B)(vii). See 25 U.S.C. §§ 2, 9; 64 Fed. Reg.

17,535-02, 17,536 (Apr. 12, 1999). To be sure, courts

may consider “generally conferred authority” in the

statutory scheme to determine the propriety of

administrative agency action. United States v. Mead

Corp., 533 U.S. 218, 229, 121 S. Ct. 2164, 2172

(2001). But sections 2 and 9 do not grant Interior “a

general power to make rules governing Indian

conduct.” Organized Vill. of Kake v. Egan, 369 U.S. 60,

63, 82 S. Ct. 562, 564 (1962). Instead, the authority

Congress there delegated to the Secretary only allows

prescription of regulations that implement “specific

38a

laws,” id., and that are consistent with other relevant

federal legislation. See Morton v. Ruiz, 415 U.S. 199,

232, 94 S. Ct. 1055, 1073 (1974); N. Arapahoe Tribe v.

Hodel, 808 F.2d 741, 748 (10th Cir. 1987) (citing

Citizens to Preserve Overton Park, Inc. v. Volpe, 401

U.S. 402, 91 S. Ct. 814 (1971)). Thus, in Village of

Kake, the Secretary issued fishing regulations

ostensibly permitted under the White Act and the

Alaska Statehood Act. However, the regulations,

which allowed the Kake community to operate four

fish traps, violated Alaska’s antifish-trap and

conservation law. Because Interior could point to no

affirmative statutory grant of authority that allowed

the Secretary to issue regulations in derogation of

state law, the Supreme Court held that the Secretary

had exceeded the authority granted by sections 2 and

9. Id. at 62, 82 S. Ct. at 564. Village of Kake

demonstrates that the Secretary lacks carte blanche

to issue regulations pursuant to a generalized grant

of authority untethered from the confines of

preexisting statutorily defined rights. See United

States v. Eberhardt, 789 F.2d 1354, 1360 (9th Cir.

1986).

For example, in Eberhardt, the Ninth Circuit

approved’ secretarial regulations imposing a

moratorium on commercial fishing on the Hoopa Valley

Reservation. The court held that the Secretary was

authorized to issue the regulations pursuant to the

preexisting fishing mghts that were granted when

Congress authorized creation of the Hoopa Valley

Reservation by statute. See People v. McCovey, 685

P.2d 687, 697 (Cal. 1984) (citing Menominee Tribe v.

United States, 391 U.S. 404, 405-06, 88 S. Ct. 1705,

1707 (1968)). In similar fashion, the caselaw

39a

overwhelmingly confirms that sections 2 and 9 do not

empower issuance of regulations without a statutory

antecedent. See, e.g., Washington v. Wash. State

Commercial Passenger Fishing Vessel Assoc., 443 U.S.

658, 691, 99 S. Ct. 3055, 3077 (1979) (sections 2 and 9

effectuate rights granted by treaty); N. Arapahoe

Tribe, 808 F.2d at 749 (general trust statutes

“together with the Treaty . . . provide the necessary

authority for the Secretary to enact’ these

regulations.”); United States v. Michigan, 623 F.2d

448, 450 (6th Cir. 1980) (upholding secretarial

regulations governing rights conferred by treaty).!9

IGRA, however, does not guarantee an Indian

19 In addition to the requirement that the regulations be issued

in accordance with the rights conferred on the tribe by existing

federal legislation, here, IGRA courts have recognized that

sections 2 and 9 address the protection and management of

“Indian trust resources” — typically natural resources or property.

See, e.g., Washington v. Wash. State Commercial Passenger

Fishing Vessel Assoc., 443 U.S. 658, 99 S. Ct. 3055 (1979)

(fishing rights); Chippewa Indians of Minn. v. United States, 301

U.S. 358, 57 S. Ct. 826 (1937) (land allotment); Pyramid Lake

Paiute Tribe of Indians v. United States Dep’t of Navy, 898 F.2d

1410 (9th Cir. 1990) (fisheries preservation); N. Arapahoe Trib» v.

Hodel, 808 F.2d 741 (10th Cir. 1987) (hunting and fish.rg

rights); see also Morton v. Ruiz, 415 U.S. 199, 94 S. Ct. 1055

(1974) (payment of general assistance benefits authorized under

25 U.S.C. § 13); Seminole Nation v. United States, 316 U.S. 286,

62 S. Ct. 1049 (1942) (money held in trust by the United States).

Appellees’ assertion that sections 2 and 9 apply here assumes

that anticipated gambling revenues constitute an Indian trust

resource within the meaning of those statutes. This assertion is

especially unjustified since, under IGRA, after a_ tribal-state

compact is in place the Secretary has no role whatsoever in the

management or oversight of Class III gaming. See 25 U.S.C. §

2710(d)(5).

40a

tribe the nght to conduct Class III gaming and

therefore cannot serve as a statutory antecedent

justifying the Secretarial Procedures. IGRA grants

tribes the right to negotiate the terms of a tribal-

state compact, see 25 U.S.C. § 2710(d)(3)(A), and by

agreement to “regulate class III gaming on its Indian

lands concurrently with the State.” § 2710(d)(5).

Tribes, likewise, have the right to bring suit against a

state for its failure “to enter into negotiations with

the Indian tribe.” See § 2710(d)(7)(A)G). Seminole

Tribe, of course, clarified that the tribe’s right is

subject to the state’s exercise of an affirmative

jurisdictional defense under the Eleventh Amendment.

In any case, the Secretary’s acting under sectiwns 2

and 9 cannot sidestep IGRA’s remedial process for

two reasons. First, there would have been no reason

for IGRA to prescribe any procedures had Congress

been willing to or believed it could entrust them

entirely to the Secretary’s general powers. Second,

the fact that IGRA clearly limited the Secretary's

intervention into Class III gaming compacts constitutes

the best evidence of congressional intent to limit the

Secretary’s role.

IV. CONCLUSION

The Secretarial Procedures’ violate’ the

unambiguous language of IGRA and congressional

intent by bypassing the neutral judicial process that

centrally protects the state’s role in authorizing tribal

Class Ill gaming. Congress, to be sure, could omit

states entirely from Class III gaming regulation. See

Cabazon Band, 480 U.S. at 207, 107 S. Ct. at 1087.

But we need not speculate on legislative alternatives

that Congress might adopt in response to Seminole

Tribe. Suffice it here to say that the balance Congress

4ia

did strike cannot be wholly revised by substitute

procedures that contradict Congress’s’ explicit

statutory instructions. The Secretarial Procedures are

invalid and constitute an unreasonable interpretation

of IGRA. When, as here, “the intent of Congress is clear,

that is the end of the matter; for the court, as well as the

agency, must give effect to the unambiguously expressed

intent of Congress.” Chevron, 467 U.S. at 842-43, 104

S. Ct. at 2781.

Pursuant to the foregoing discussion, we

REVERSE the district court's judgment and

REMAND for further proceedings consistent with

this opinion.

REVERSED and REMANDED.

42a

KING, Circuit Judge, concurring in part and in the

judgment:

I concur in Part III.A of the opinion, which

deals with justiciability. On the merits, I concur only

in the judgment, reversing the district court’s

conclusion that the Secretary of the Interior

(“Secretary”) had the authority to promulgate the

challenged regulations.

In my view, the lack of any provision in the

Indian Gaming Regulatory Act (““IGRA”) addressing

the dismissal of an Indian tribe’s enforcement suit on

sovereign immunity grounds is a statutory gap that

is akin to the gap recognized in Pittston Co. v. United

States, 368 F.3d 385, 403-04 (4th Cir. 2004), and

Sidney Coal Co. v. Social Security Administration,

427 F.3d 336, 346 (6th Cir. 2005). Those cases held

that the Social Security Commissioner had implicit

authority to fill a gap exposed by the Supreme

Court’s invalidation of a portion of the Coal Industry

Retiree Health Benefit Act of 1992; in this case the

Secretary’s general authority to effectuate statutes

relating to Indian affairs provides analogous gap-

filling power with regard to IGRA. See 25 U.S.C. §§ 2,

9; Morton v. Ruiz, 415 U.S. 199, 231 (1974);

Organized Village of Kake v. Egan, 369 U.S. 60, 63

(1962).

However, the Secretary's authority to

effectuate IGRA's provisions does not include the

power to jettison some of those provisions in the

cause of gaprfilling, regardless of whether they no

longer seem wise or appropriate in light of events

that Congress did not foresee. In my opinion, the

43a

method used by the Secretary to fill the gap here—

creating an alternative remedial scheme that allows

the Secretary to issue Class II] gaming procedures

without Congress’s chosen prerequisites of a court

determination of a state’s bad faith and court-

directed mediation, see 25 U.S.C. § 2710(d)(7)—goes

beyond the mere effectuation of IGRA’s provisions

into the realm of wholesale statutory amendment.

Cf. Gonzales v. Oregon, 546 U.S. 248, 258 (2006)

(“Chevron deference ... is not accorded merely

because the statute is ambiguous... . To begin with,

the rule must be promulgated pursuant to authority

Congress has delegated to the official.”). By omitting

those prerequisites, though for understandable

reasons, the Secretary’s method fails to preserve the

core safeguards by which state interests are

protected in Congress’s “carefully crafted and

intricate remedial scheme.” Seminole Tribe of Fla. v.

Florida, 517 U.S. 44, 73-74 (1996); cf Ragsdale v.

Wolverine World Wide, Inc., 535 U.S. 81, 91 (2002)

(invalidating an administrator’s remedial regulation

that “worked an end run around important

limitations of the [relevant] statute’s remedial

scheme” by allowing a penalty to be imposed without

the threshold court determination provided for by the

statute). And despite a state’s unforeseen and

unintended ability to prevent the necessary court

involvement from occurring, the Secretary “has no

power to correct flaws that [he] perceives in the

statute [hel is empowered to administer. [His]

rulemaking power is limited to adopting regulations

to carry into effect the will of Congress as expressed

in the statute.” Bd. of Governors v. Dimension Fin.

Corp., 474 U.S. 361, 374 (1986).

44a

Today’s decision returns IGRA’s Class III

gaming system to the complicated situation that

existed after the Supreme Court’s decision in

Seminole Tribe, with a state having the leverage to

block gaming on Indian land under IGRA in a

manner wholly contrary to Congress’s_ intent.

Alternatively, one could argue that a tribe dealing

with a state that will not negotiate or consent to an

enforcement suit is no longer bound by IGRA’s

prohibition on gaming without a compact, depending

on the circumstances. See, e.g., United States v.

Spokane Tribe of Indians, 139 F.3d 1297 (9th Cir.

1998). We do not resolve these difficulties here, as

they are not before this court. But because neither

result is consistent with IGRA’s design, the situation

clearly calls for congressional action.

DENNIS, Circuit Judge, dissenting.

The State of Texas permits certain types of

gaming equivalent to Class II] gaming as defined by

the IGRA. But: Texas adamantly refuses to negotiate

with the Kickapoo Traditional Tribe towards a Class

IiI gaming compact under the IGRA and has blocked

the tribe from seeking a remedy in federal court by

invoking its right to Eleventh Amendment sovereign

immunity from suit. Therefore, the Tribe pursued its

only alternate remedy of asking the Secretary of the

Interior to issue Class II] gaming procedures under

the Secretarial Gaming Procedures, 25 C.F.R. §§

291.1-291.15. The Secretary requested comment from

the State of Texas pursuant to 25 C.F.R. § 291.7, but

the state declined to comment. The Secretary has not

yet taken final action on the Tribe’s proposal.

45a

The State of Texas brought this action against

the Secretary, the Department of the Interior and the

United States challenging the authority of the

Secretary to promulgate the Secretarial Gaming

Procedures regulations and seeking to permanently

enjoin the application of 25 C.F.R. § 291.1, et seq., in

respect to the state of Texas. The Kickapoo

Traditional Tribe intervened. The district court ruled

that Texas’s claims were not ripe, but expressed its

opinion that the regulations were’ validly

promulgated and should be upheld. Texas v. United

States, 362 F. Supp.2d 765 (W.D. Tex. 2004). Texas

appealed. The defendants-appellees and- the

intervener contend that Texas’s suit should be

dismissed because it lacks standing, its claim is not

ripe, and the Secretarial Gaming Procedures

regulations are valid. I pretermit the serious

standing and ripeness issues but dissent from the

merits of Chief Judge Jones’ opinion, portions of

Judge King’s opinion, and the judgment for the

following reasons.

IT.

The principles governing our review of the

Secretary’s interpretation and implementation of the

pertinent statutes are well established.

Administrative implementation of a _ particular

statutory provision qualifies for Chevron deference

when it appears that Congress delegated authority to

the agency generally to make rules carrying the force

of law, and that the agency interpretation claiming

deference was promulgated in the exercise of that

authority. United States v. Mead Corp., 533 U.S. 218

(2001); see also Chevron, U.S.A., Inc. v. Natural Res.

46a

Def. Council, Inc., 467 U.S. 837 (1984). Congressional

delegation to an administrative agency of authority

generally to make rules carrying the force of law may

be shown in a variety of ways, as by an agency’s

power to engage in adjudication or notice-and-

comment rule-making, or by some other indication of

a comparable congressional intent. Mead, 533 U.S. at

Bai.

When Congress has explicitly left a gap for an

agency to fill, there is an express delegation of

authority to the agency to elucidate a_ specific

provision of the statute by regulation, and any

ensuing regulation is binding in the courts unless

procedurally defective, arbitrary or capricious in

substance, or manifestly contrary to the statute. Id.

Considerable weight should be accorded to an

executive department’s construction of a statutory

scheme it is entrusted to administer. Id. “The power

of an administrative agency to administer a

congressionally created and funded program

necessarily requires the formulation of policy and the

making of rules to fill any gap left, implicitly or

explicitly, by Congress.” Morton v. Ruiz, 415 U.S.

199, 231-32 (1974).

When circumstances imply that Congress

would expect an agency to be able to speak with the

force of law, even though Congress may not have

expressly deli gated authority or responsibility to

implement a particular provision, a reviewing court

has no business rejecting an agency’s exercise of its

gencrally conferred authority to resolve a particular

statutory ambiguity simply because the agency's

chosen resolution seems unwise, and instead is

47a

obliged to accept the agency’s position if Congress has

not previously spoken to the point at issue and the

agency’s interpretation is reasonable. Id. at 229.

III.

The regulations challenged here, pertaining to

the Secretarial Gaming Procedures, deserve Chevron

deference because Congress explicitly authorized the

Secretary to promulgate regulations to carry into

effect any statute relating to Indian affairs or arising

out of Indian relations, see 25 U.S.C. §§ la, 2 & 9;

and implicitly authorized the Secretary to

promulgate the regulations at issue here to fill the

gap in the IGRA created by Congress’s unintentional

failure to provide for the unforeseen ineffectiveness of

a federal court suit as the tribal remedy in cases in

which a state refused to bargain in good faith and

invoked its Eleventh Amendment — sovereign

immunity; the regulations are reasonably designed

and appropriate for carrying into effect the IGRA

after the ineffectiveness of its remedial provision was

revealed by Seminole Tribe of Florida v. Florida, 517

U.S. 44 (1996); and the regulations are binding in the

courts because they are not procedurally defective,

arbitrary or capricious in substance, or manifestly

contrary to the statutes.

Beginning in 1832 and 1834, Congress

explicitly authorized the President through the

Secretary of the lIiterior to “prescribe such

regulations as he may think fit for carrying into effect

the various provisions of any act relating to Indian

affairs, and for the settlement of the accounts of

Indian affairs,” 25 U.S.C. § 9; and to authorize the

Commissioner of Indian affairs to, “under the

48a

direction of the Secretary of the Interior, and

agreeably to such regulations as the President may

prescribe, have the management of all Indian affairs

and of all matters arising out of Indian relations.” 25

U.S.C. § 2.1 Acting pursuant to these broad powers,

the Secretary has, following formal notice-and-

comment rule-making procedures, promulgated

procedures governing numerous programs and

activities related to Indian affairs and relations.

Prior to the enactment of the IGRA, states

generally were precluded from any regulation of

gaming on Indian reservations. California v. Cabazon

Band of Mission Indians, 480 U.S. 202 (1987). The

IGRA, by offering states an opportunity to participate

with Indian tribes in establishing gaming through a

tribal-state compact, “extendled] to the States a

power withheld from them by the Constitution.”

Seminole, 517 U.S. at 58. Consequently, it is clear

that before the enactment of the IGRA, the Secretary

could have adopted, under 25 U.S.C. §§ la, 2, & 9,

regulations approving and governing gambling on

Indian reservations to the extent it was not

prohibited by general state laws.

Congress’s enactment of the IGRA in 1988 did

not in any way diminish the broad powers of the

President or the Secretary to “prescribe such

regulations as he may think fit for carrying into effect

any act relating to Indian affairs... or

[management of] matters arising out of Indian

relations.” See 25 U.S.C. §§ 2 & 9. When the Supreme

' See Morton v. Ruiz, 415 U.S. 199 (1974); see also 25 U.S.C. §

la.

49a

Court subsequently held in Seminole that Congress is

not authorized by the Indian commerce clause to

abrogate a state’s Eleventh Amendment sovereign

immunity, this unforeseen event disclosed the

ineffectiveness of the remedy Congress had granted

tribes in the IGRA to sue recalcitrant states in

federal court. The immediate result was that states

could, as Texas has done, refuse to bargain and

invoke sovereign immunity against a tribe’s federal

court remedy. This revealed that after Seminole the

tribes had no remedy to enforce the IGRA, a gap in

the statute that Congress had not anticipated and

had unintentionally failed to provide for. Under these

circumstances, it became the Secretary’s clear duty to

use his broad rule-making powers under 25 U.S.C. §§

la, 2 and 9 to provide alternate remedies and

procedures necessary to carry the IGRA into effect.

Nothing in the IGRA or its legislative history

indicates an intention to prevent the Secretary from

retaining and putting his broad rulemaking powers

to this use.

The purpose of the IGRA is not simply to

establish a neutral bargaining forum; IGRA’s purpose

is to affirmatively help Indian tribes enter and

conduct the business of gaming, where gaming is not

prohibited by state laws of general application, as a

means of “promoting tribal economic development,

self-sufficiency, and strong tribal governments.” 25

U.S.C. § 270201). The IGRA federal court action

remedy was “designed to ensure the formation of a

Tribal-State compact.” Seminole, 517 U.S. at 49-50.

Because this remedy has been shown to be

inoperative by Seminole, the Secretary’s Gaming

Procedures are consistent with the purpose and

50a

provisions of the IGRA and are the most reasonable

regulations that could be administratively prescribed

to carry the IGRA into effect.

IV.

With respect, there is no valid basis for Chief

Judge Jones’s assertion that a judicial interpretation

of a statute cannot lead to an ambiguity, gap or

unprovided for case susceptible to the Chevron step-

two analysis. To the contrary, there is no other way

for a court to identify a statutory ambiguity or gap

than through the process of judicial interpretation.

The argument that a court decision “creates” a

gap is based on a theory inconsistent with the

common-law tradition of the federal courts. The

prevailing view is that the judicial power vestted in

the federal courts allows them to declare what the

law already is, rather than to create new law as the

Chief Judge’s argument presupposes that the Court

did in Seminole. See American _ Trucking

Associations, Inc. v. Smith, 496 U.S. 167, 201 (1990)

(Scalia, J., concurring in judgment); Linkletter v.

Walker, 381 U.S. 618, 622-23 (1965). Under the

prevailing Supreme Court view, the ambiguity or gap

in the IGRA was created by the Congress when it

unintentionally chose and enacted a constitutionally

ineffectual tribal remedy, and not by the Court in the

Seminole decision. The Supreme Court’s primciples

governing retroactive application of its decisions

reflect this view: “When this Court applies a rule of

federal law to the parties before it, that rule is the

controlling interpretation of federal law and must be

given full retroactive effect in all cases still open on

direct review and as to all events, regardless of

5la

whether such events predate or postdate our

announcement of the rule.” Harper v. Virginia Dep’t

of Taxation, 509 U.S. 86, 97 (1993).2 Under prevailing

Supreme Court theory, the Seminole decision is and

always was the law. The Supreme Court does not

create law, it discovers it - and the Supreme Court

did not create the gap in this case, but merely

declared its existence. Congress itself created the gap

or ambiguity by mistakenly overestimating its

powers and passing a statute that could not be

constitutionally applied as Congress intended.

The claim that a Chevron gap does not exist

when a judicial decision has demonstrated an

ambiguity in the statute has been emphatically

rejected by other courts. In A.T. Massey Coal Co. v.

Holland, 472 F.3d 148, 168 (4th Cir. 2006), the

Fourth Circuit discussed a case in which a gap was

“created when the Supreme Court found a portion of

[al provision unconstitutional.” It held that “lolnce

that gap was created, the agency was left with an

open policy space, which was the quintessence of

legislative-type action to which Chevron deference

was due.” Id. In another case, Pittston Co. v. United

States, 368 F.3d 385, 403-04 (4th Cir. 2004), the

Fourth Circuit considered a gap disclosed by a

judicial decision holding a portion of the Coal Act to

be unconstitutional:

In drafting the Coal Act, Congress did

* For a full discussion of the history of the common law

retroactivity principle and the Supreme Court’s recent return to

the traditional view that it discuvers law, rather than makcs it,

see Hulin v. Fibreboard Corp., 178 F.3d 316, 329-33 (5th Cir.

1999).

52a

not contemplate that some members of

the “signatory operators” group could

not constitutionally be required to

contribute to the Combined Fund. The

situation faced by the Commissioner

was thus the kind of “case unprovided

for” that allows her to engage in gap-

filling. See Barnhart v. Peabody Coal

Co., 537 U.S. 149, 169 (2003).

Id. The Sixth Circuit agreed that a gap for Chevron

purposes was created when a portion of the Coal Act

proved to be unintentionally ineffective. Sidney Coal

Co. v. Soc. Sec. Admin., 427 F.3d 336, 346 (6th Cir.

2005) (holding that a gap existed because “the Coal

Act contains no language as to how the SSA should

have handled the precise question raised by the

Eastern Enterprises holding”).

Chief Judge Jones’s attempt to distinguish

these cases is unpersuasive and circular. She

contends that because Congress must be able to

foresee each gap and each agency rule chosen to fill

it, the Secretary’s remedial scheme here to fill the

gap exceeds the scope of the authority delegated by

Congress; so that, the gap created by judicial decision

recognized in Pittson and A.T. Massey could not have

existed in the first place. This is a tortured logic that

conflates two fundamentally distinct questions: was

there a gap or ambiguity, and if so, did the Secretary

exceed its authority in attempting to fill it?

Contrary to the suggestion of Chief Judge

Jones, the language of Chevron does not require that

Congress must be able to envision a future gap or

53a

ambiguity and the particular provision that the

agency may choose to fill it or clarify it before it can

come within the scope of the agency’s implicitly

authorized rulemaking. “[I]t can still be apparent

from the agency's generally conferred authority and

other statutory circumstances that Congress would

expect the agency to be able to speak with the force of

law when it addresses ambiguity in the statute or

fills a space in the enacted law, even one about which

Congress did not actually have an intent as to a

particular result.” Mead, 533 at 229 (quotations

omitted) (emphasis added). Congress may “create” a

gap by explicitly delegating a question of

interpretation to an agency; Chevron, 467 U.S. at

843-44; by implicitly doing so; id. at 844; or by simply

remaining silent “with respect to the specific issue;”

id. at 843. It is inherent in the policymaking process

that some unforeseen event, or “case unprovided for,”

could render a portion of a statute ambiguous or

meaningless. See Barnhart v. Peabody Coal Co., 537

U.S. 149, 169 (2003). The Ninth Circuit best

described the situation that confronted the Secretary

and now confronts us:

We are left, then, with a tribe that

believes it has followed IGRA faithfully

and has no legal recourse against a state

that allegedly hasn’t bargained in good

faith. Congress did not intentionally

create this situation and would not have

countenanced it had it known then what

we know now.

United States v. Spokane Tribe of Indians, 139 F.3d

1297, 1302 (9th Cir. 1998). There is no support for

54a

the suggestion that Congress cannot, through its

unintentional silence, create a gap or an ambiguity

concerning how to enforce the IGRA after a portion of

it, the sole tribal remedy originally chosen, has been

invalidated.

Chief Judge Jones further errs in contending

that there has been no explicit or implicit

congressional delegation of authority to the Secretary

of the Interior to promulgate gaprfilling regulations

under the IGRA. Contrary to her assertions, the

Secretary does not hang his hat on a mere failure of

Congress to expressly withhold a delegation of agency

authority. Rather, the Secretary of the Interior is the

agency Congress would have expected to fill any such

gap, given the powers granted to it under the IGRA

and its general authority statutes. Chief Judge Jones

focuses narrowly on the particular IGRA provision at

issue here, relying conclusively on the fact that the

IGRA itself does not contain an express delegation of

agency authority to provide an alternate tribal

remedy. The Supreme Court, by contrast, has

instructed us to broaden our inquiry outside of the

particular provision we are reviewing to include all

statutes and circumstances pertaining to the agency's

powers:

Congress, that is, may not have

expressly delegated authority or

responsibility to implement a particular

provision or fill a particular gap. Yet it

can still be apparent from the agency's

generally conferred authority and other

statutory circumstances that Congress

55a

would expect the agency to be able to

speak with the force of law when it

addresses ambiguity in the statute or

fills a space in the enacted law, even orie

about which “Congress did not actually

have an intent” as to a particular result.

When circumstances implying such an

expectation exist, a reviewing court has

no business rejecting an agency’s

exercise of its generally conferred

authority to resolve a_ particular

statutory ambiguity simply because the

agency's chosen resolution seems unwise,

but is obliged to accept the agency’s

position if Congress has not previously

spoken to the point at issue and the

agency’s interpretation is reasonable....

Mead, 533 U.S. at 229 (internal citations omitted).

Instead of inquiring into whether Congress would

have expected the Secretary of the Interior to address

any ambiguities in the IGRA, Chief Judge Jones

focuses on whether the particular IGRA statutory

provision at issue included a delegation of authority

to the Secretary - an analysis that is both contrary to

the Supreme Court’s admonition in Mead and that

would impose an impractical burden on Congress of

including express delegations of an _ agency’s

authority to administer every provision of every

statute under its aegis.

Chief Judge Jones’s analysis of the general

authority statutes and the IGRA itself is similarly

unpersuasive. Her opinion rejects the significance of

56a

25 U.S.C. §§ 2 & 9, the general authority statutes for

the Department of the Interior, based on a misplaced

reliance on the Supreme Court’s decision in

Organized Village of Kake v. Egan. 369 U.S. 60

(1962). Kake is a weak authority for her position for

several reasons. Even if it made the sweeping

holdings Chief Judge Jones attributes to it, the case

was decided in 1963 and did not conduct the modern

analysis required by more recent cases such as

Chevron and Mead. A greater difficulty for Chief

Judge Jones is that while it does indeed include

language to the effect that these sections do not grant

the Interior “a general power to make rules governing

Indian conduct,” that language was not the holding of

the court in that case. That language was, instead, a

quotation from an Interior Department Handbook,

and was not expressly adopted by the Court. The

Court’s actual legal holding with respect to the scope

of the general authority statutes was confined to a

single sentence: “We agree that they do not support

the fish-trap regulations.” Kake. 369 U.S. at 63. Most

significantly, in Kake the Court was analyzing a

situation in which other Congressional legislation,

the White Act, had expressly narrowed the authority

of the Secretary of the Interior under 25 U.S.C. §§ 2

and 9 in the specific area in which he attempted to

act. Id. at 62-63. It was also plain that, unlike in this

case, there was no underlying statute being enforced

and the Secretary was not attempting to “implement

specific laws” - a power the Handbook referenced by

the Supreme Court in Kake concluded was granted to

Interior under the general authority statutes. Id.

Chief Judge Jones’s reliance on United States v.

Eberhardt, 789 F.2d 1354 (9th Cir. 1986), similarly

57a

distorts the actual holding of the case. Her opinion

omits that court’s holding that “the general trust

statutes in Title 25 do furnish Interior with broad

authority to supervise and manage Indian affairs and

property commensurate with the trust obligations of

the United States.” Id. at 1360. In distinguishing

Kake and concluding that the general authority

statutes were broad in scope, the Eberhardt court

added that “Congress must be assumed to have given

Interior reasonable power to discharge its broad

responsibilities for the management of Indian affairs

effectively.” Id. at 1361.

Chief Judge Jones’s opinion further avoids

referencing other cases that have also come to the

conclusion that the Secretary of the Interior has

comprehensive powers under the general authority

statutes to effectuate other Indian-related legislation.

The D.C. Circuit, from which her opinion eagerly

borrows in other sections, emphatically disagrees

with a cramped view of the general authority statutes

such as hers. That court described the powers of the

Secretary of the Interior under the general authority

statutes as follows:

In charging the Secretary with broad

responsibility for the welfare of Indian

tribes, Congress must be assumed to

have given him reasonable powers to

discharge it effectively. Courts have

taken this approach with respect to

various aspects of Indian siife,

recognizing that ‘[this] statute furnishes

broad authority for the supervision and

58a

management of Indian affairs and

property commensurate with the

obligation of the United States.’

In our opinion the very general language

of the statutes makes it quite plain that

the authority conferred upon _ the

Commissioner of Indian Affairs was

intended to be sufficiently

comprehensive to enable him, agreeably

to the laws of Congress and to the

supervision of the President and the

Secretary of the Interior, to manage all

Indian affairs, and all matters arising

out of Indian relations, with a just

regard, not merely to the rights and

welfare of the public, but also to the

rights and welfare of the Indians, and to

the duty of care and protection owing to

them by reason of their state of

dependency and tutelage.

Udall v. Littell, 366 F.2d 668, 672-73 (D.C. Cir. 1966)

(internal citations and footnotes omitted). Other

circuits have agreed that the Secretary’s powers to

promulgate regulations to effectuate all Indian-

related statues are broad in scope. See Armstrong v.

United States, 306 F.2d 520, 522 (10th Cir. 1962)

(‘This statute furnishes broad authority for the

supervision and management of Indian affairs and

property commensurate with the obligation of the

United States.”).

Inexplicably, the Chief Judge’s opinion fails to

acknowledge that, subsequent to Kake, the Supreme

59a

Court in Morton v. Ruiz, in articulating the keystone

to the Chevron doctrine, simultaneously recognized

that Congress intended for the Secretary of the

Interior to play a major policy-making, rule-making,

and gaprfilling role in effectuating its Indian-related

statutes. The Court plainly rejected an impracticably

constrained view of the Secretary’s powers in stating:

The power of an administrative agency

to administer a congressionally created

and funded program necessarily

requires the formulation of policy and

the making of rules to fill any gap left,

implicitly or explicitly, by Congress. In

the area of Indian affairs, the Executive

has long been empowered to promulgate

rules and policies, and the power has

been given explicitly to the Secretary

and his delegates at the BIA.

415 U.S. at 231-32 (footnotes citing and quoting 25

U.S.C. §§ 2 & 9 as authority omitted).

Pursuant to its general authority under 25

U.S.C. §§ 2 & 9, recognized so clearly by Morton v.

Ruiz and later built upon in Chevron, the Secretary

of the Interior has_ successfully promulgated

regulations governing activities across the spectrum

of Indian affairs. See 25 C.F.R. § 23.1 (regulating

child and family service programs under the Indian

Child Welfare Act); 25 C.F.R. § 89.30 (approval of

legal contracts with certain tribes); 25 C.F.R. § 166.1

(imposing grazing restrictions on tribal lands); 25

C.F.R. § 241.1 (regulating fishing on certain

reservations); 25 C.F.R. § 150.1 (regulating the

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recording, certification, and use of title documents on

tribal lands); 25 C.F.R. § 61.1 (regulating the

management of rolls and membership lists of Indian

tribes); 25 C.F.R. § 83.1 (establishing procedures for

determining whether a group constitutes an Indian

tribe).

Chief Judge Jones is further incorrect in

suggesting that there is no “statutory antecedent” to

support the Secretary’s regulations at issue here

under the general authority statutes. The short

answer to Chief Judge Jones’s suggested complaint,

of course, is that there is an obvious “statutory

antecedent” here - the IGRA itself, which clearly

evinces Congress’s intent to empower the Secretary

to authorize Indians to conduct gaming businesses on

tribal reservations where not prohibited by general

state laws and after giving states a full and fair

opportunity to bargain in good faith over the specific

terms of the individual tribal gaming regulations. It

turns out, however, that her argument in this respect

is simply another version of her argument against

implicit agency authority, diametrically contrary to

Chevron and Mead, to the effect that each separate

Indian-related statute must explicitly authorize the

Secretary to carry it into effect, iLe., that the general

authority statutes alone do not really do what they

purport to — empower the Secretary to prescribe

regulations to effectuate subsequent Indian-related

statutes. The cases upon which the Chief Judge

relies, again, however, do not see her argument

through. In the final analysis, they stand only for the

simple proposition that in order for the Secretary to

use his general authority under 25 U.S.C. §§2 and 9

to prescribe regulations to carry a subsequent statute

6la

into effect, there must first be a statute or a treaty to

effectuate. See N. Arapahoe Tribe v.Hodel, 808 F.2d

741, 745-46 (10th Cir. 1987) (holding that 25 U.S.C. §

9 could not be applied unless it was to carry “into

effect the various provisions of any act relating to

Indian affairs,” but that a treaty could in effect

substitute for an act or statute); United States v.

Michigan, 623 F.2d 448, 450 (6th Cir. 1980) (holding

only that the requirement is not a difficult one to

meet and that a treaty can substitute for an “act

relating to Indian affairs”). The Chief Judge’s opinion

plays a linguistic game, using the phrase “statutory

antecedent” to suggest that there must be some

specific provision in every Indian-related statute

granting the authority to invoke sections 2 and 9 -

when, in fact, the courts have only logically required

that some sort of statute or law related to Indian

affairs be extant before the Secretary can prescribe

regulations to carry it into effect. In other words,

when Congress enacts a statute pertaining to Indian

affairs and relations, but not before, it becomes the

duty of the President and the Secretary to exercise

their powers under 25 U.S.C. § 2 & 9 to promulgate

rules necessary to give it effect. Ruiz, 415 U.S. at 231.

Chief Judge Jones’s further assertion that “the

fact that IGRA clearly limited the Secretary’s

intervention into Class III gaming’ compacts

constitutes the best evidence of congressional intent

to limit the Secretary’s role” ignores the reality of the

situation here: that Congress enacted the statute

without foreknowledge of the Supreme Court's

decision in Seminole. That Congress did _ not

contemplate a need for the Secretary to prescribe an

alternate tribal remedy to fill a gap is merely a

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function of Congress’s failure to foresee the gap it

was leaving, i.e., Congress did not foresee that it

lacked power under the Indian commerce clause to

abrogate state sovereign immunity and _ that,

therefore, its own statutorily prescribed tribal

remedy of a federal court suit would prove to be

ineffectual. Congress’s lack of foreknowledge that the

IGRA would prove to be devoid of any

constitutionally effective tribal remedy does not

suggest in the slightest that Congress anticipated or

intended that the Secretary would default in his duty

to prescribe an alternate remedial procedure to carry

the IGRA into effect.

As with the general authority statutes, the role

of the Interior under the specific delegations of

authority under the ‘GRA is far broader than what

Chief Judge Jones’s vupinion, focused as it 1s on a

narrow section of the law, admits. The IGRA

authorizes the Secretary to approve or disapprove

Tribal-State compacts according to whether a

compact complies with or violates the IGRA, federal

law or “the trust obligations of the United States to

Indians.” 25 U.S.C. § 2710(d)(8)(B). Further, the

IGRA specifically provides that “[ilf the State does

not consent ... to a proposed compact submitted by a

mediator ..., the mediator shall notify the Secretary

and the Secretary shall prescribe, in consultation

with the Indian tribe, procedures ... which are

consistent with ... the relevant provisions of the laws

of -the State....” 25 U.S.C. § 2710(d)(7)(B)(vii)

(emphasis added) Thus, the IGRA contemplates that

the Secretary of the Interior, and not the federal or

state courts or a mediator, shall perform the task of

interpreting state and federal laws and treaties to

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assure that a proposal or compact for Indian gaming

complies with them. Additionally, the Secretary is

given powers to review and approve or disapprove

any plans by tribes to distribute -revenue from

gaming to members of a tribe, and to evaluate such

plans for whether they comply with the IGRA’s goal

of’ tribal economic development. See 25 U.S.C. §

2710(b)(3)(B).

Moreover, a number of regulatory powers are

delegated to the Secretary of the Interior through the

National Indian Gaming Commission (“NIGC”), a

three-member body within the Department of the

Interior. Tamiami Partners v. Miccosukee Tribe of

Indians, 63 F.3d 1030, 1048 (11th Cir. 1995); Seneca-

Cayuga Tribe v. Nat'l Indian Gaming Comm’n, 327

F.3d 1019, 1023 (10th Cir. 2003). Two of the three

members of the NIGC are appointed directly by the

Secretary of the Interior. Tamiami, 63 F.3d at 1048.

Congress plainly intends the Department of the

Interior to have broad authority over gaming in

enacting the IGRA, delegating to the NIGC the power

to close an Indian gaming facility permanently, to

adopt regulations governing fines, to issue subpoenas,

to inspect the books and records of a Class II gaming

facility, and to hold hearings. Id. The NIGC is

required to “monitor class II gaming continuously,

inspect class II gaming premises, promulgate

regulations necessary to implement IGRA, and

conduct background investigations of, among others,

management contractors.” Id. While the NIGC is

technically a distinct entity within the Department of

the Interior, the Secretary retains majority contro)

over the board by appointing two of its members. It is

plain that the nominal separation of the two does not

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change the clear intent of Congress to locate

rulemaking and administrative authority under the

IGRA with the Secretary of the Interior. Indeed, after

the Tenth Circuit attempted to restrict the powers of

the Interior by holding that the IGRA delegated

determinations of what constituted a reservation to

the NIGC, Sac & Fox Nation of Missouri v. Norton,

240 F.3d 1250 (10th Cir. 2001), Congress

immediately corrected the court and clarified that the

Secretary of the Interior holds this power. City of

Roseville v. Norton, 348 F.3d 1020, 1029-30 (D.C. Cir.

2003); Department of the Interior and Related

Agencies Appropriations Act, 2002, Pub. L. No. 107-

63, § 134 (2001).

In view of all of the foregoing, it is “apparent

from the agency’s generally conferred authority and

other statutory circumstances that Congress would

expect the agency to be able to speak with the force of

law” with respect to any gaps or ambiguities in the

IGRA. Mead, 533 U.S. at 229. Chief Judge Jones’s

contention to the contrary is based on a narrow

reading of a particular statutory provision, exactly

the kind of analysis forbidden by the Supreme Court.

FDA v. Brown & Williamson Tobacco Corp., 529 U.S.

120, 132 (2000) (holding that “a reviewing court

should not confine itself to examining a particular

statutory provision in isolation”).

V1.

Chief Judge Jones also incorrectly maintains

that, under step two of the Chevron analysis, the

Secretarial Procedures regulations do not reasonably

effectuate Congressional intent with respect to the

IGRA. Contrary t

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