Indian Nations Law Update

Transcription

1 Indian Nations Law Update July 2009 Vol 4, Issue 7 Brian L. Pierson (414) bpierson@gklaw.com Treasury Department Announces Rules for Allocation of Tribal Economic Development Bonds: Deadline for First Round Is August 15, 2009 The American Recovery and Reinvestment Act of 2009 greatly expanded the authority of tribes to issue tax exempt bonds by authorizing the Secretary of the Treasury, in consultation with the Secretary of the Interior, to allocate up to $2 billion in Tribal Economic Development Bonds (TEDBs). (See G&K February 2009 Update.) On June 23rd, IRS published Notice , which sets forth (1) project eligibility requirements, (2) application requirements and forms, (3) the methodology that IRS will use in allocating volume cap among applicants, and (4) interim guidance. Key features include: Applications for allocation of $2 billion in authorized TEDB volume will be accepted in two stages. Applications for an allocation of the first $1 billion are due August 15, Applications for the second $1 billion will be due January 1, Carl J. Artman (414) cartman@gklaw.com Applications must: describe the project in reasonable detail and indicate dates for construction and completion; provide assurances that the project is located on the tribe s reservation, that bond proceeds will not be used for gaming and that regulatory approvals have been, or will be, obtained; contain a reasonably detailed description of the proposed project financing, including a description of sources and uses of all sources of financing, security for the financing, total amount of bonds to be issued, and schedule for disbursement of bond proceeds; a statement that the applicant reasonably expects to issue bonds approved in the first round by December 31, 2010 or, if bonds are allocated in the second round, by December 31, No tribe will be allocated more than $30 million in TEDB authority in the first round. If the total amount of volume cap requested by qualified projects in the first round exceeds $1 billion then each qualified project s allocation will be reduced pro rata so that the total allocation does not exceed $1 billion. Additional volume cap may sought in the second round for projects whose first round allocation was reduced. Projects owned jointly by a tribe and a non-tribal entity are eligible provided that the TEDBs are used for the tribe s share of the project and the project is located on the tribe s reservation, provided that the project meets the private activity bond restrictions of IRC 141. For purposes of complying with the prohibition against the use of TEDBs for gaming, a structure will be treated as a separate building if it has an independent foundation, independent outer walls and an independent roof. Connections (e.g., doorways, covered walkways or other enclosed common area connections) between two adjacent buildings and independent walls of separate buildings may be disregarded as long as such connections do not affect the structural independence of either wall. Godfrey & Kahn s Public Finance and Indian Nations law teams have served as bond counsel and issuer s counsel in connection with billions of dollars of bond offerings, including numerous Indian country transactions. We can assist in: The following is based on a summary of legal principles. It is not to be construed as legal advice. Individuals should consult with legal counsel before taking any action based on these principles to ensure their applicability in a given situation. evaluating project eligibility; helping identify additional sources of financing; assisting in the preparation of the application for TEDB allocation; engaging financial advisors, placement agents, underwriters and other participants in the bond issuance process; providing bond counsel opinions on tax exemption; and related real estate development, joint venture structure and other business issues. For more information, contact Brian Pierson ( or bpierson@gklaw.com.) or Carl Artman ( or cartman@gklaw.com) Godfrey & Kahn, S.C.

2 2 Indian Nations Law Update Energy Efficiency Grant Application Deadline Extended to August 10th The application deadline for grants under the Energy Efficiency and Conservation Block Grant (EECBG) Program, previously set for June 25, 2009, has been extended to August 10, More than $54 Million has been set aside for Indian tribes. Although formuladriven allocations have been made for 562 Indian tribes and 12 Alaska Regional Corporations, each eligible entity MUST submit an application to receive those funds. Godfrey & Kahn s Indian Nations and Energy law teams help tribal clients evaluate energy development opportunities. Our experienced team can assist with the preparation of grant applications. HUD Recovery Act NAHASDA Competitive Round IHBG Application Deadline July 13th Applications for competitive grants for affordable housing activities authorized under the Native American Housing Assistance and Self- Determination Act of 1996 (NAHASDA), authorized by the American Reinvestment and Recovery Act (ARRA), are due July 13th. (See June Update for more information.) Competitive round funds, like the formula funds, can be used for acquisition, new construction, rehabilitation of affordable housing, site improvement, development and rehabilitation of utilities and infrastructure, utility services, conversion, demolition, financing, administration and planning, improvement to achieve greater energy efficiency, mold remediation, investments that leverage private sector funding or financing for renovations, and energy conservation retrofit investments. Priority will be given to projects that will spur construction and rehabilitation and will create employment opportunities for low-income and unemployed persons. Funds must be obligated through competitive funding by September 30, FY 2009 Indian Community Development Block Grant Application Deadline August 7th The deadline for applications for grants under the FY 2009 Indian Community Development Block Grant (ICDBG) program is August 7, (See June Update for more information.) Eligible uses include housing construction, rehabilitation, acquisition of land for housing, direct assistance to facilitate homeownership among low- and moderate-income persons, construction of tribal and other facilities for single or multi-use, streets and other public facilities, and economic development projects. Godfrey & Kahn s Indian Nations and Business law teams help tribal clients evaluate community development opportunities. Our experienced teams can assist with the preparation of applications. Canada to Redefine Indian Status The Canadian government plans to rewrite sections of the contentious 19th century Indian Act relating to Indian status after the highest court in British Columbia held in April in McIvor v. Canada that current law violates Canadian prohibitions against sex discrimination. Indian status in Canada provides non-insured medical benefits, financial help with post-secondary education, and other benefits. Under the Indian Act of 1876, a non-indian woman who married an Indian man would be entitled to Indian status and, subsequently, so would their children. An Indian woman who married a non-indian man, by contrast, would lose her Indian status, and their children would not be entitled to Indian status. In 1985, the Canadian government attempted to end the discriminatory definition of Indian status as it applied to women. While the 1985 amendments restored Indian status to women who had married non-indians, in many situations, it still prevented women from passing Indian status to their children and grandchildren. In the McIvor case, Sharon McIvor and her son, Charles Grismer, challenged the 1985 amendments on the basis that because McIvor was a woman, she was unable to pass status to her grandchildren. The court found that sections of the Indian Act of 1985 violate the Canadian Charter of Rights and Freedom, which affords every individual equal protection and benefit of law without discrimination based on sex. The trial judge, seeking to provide redress retroactively for all those disadvantaged by the 1985 amendments, would have granted Indian status to all individuals who could show that somewhere in their ancestry there was a person who had lost Indian status by virtue of being a woman married to a non-indian, a class that some observers estimated to include 100,000 or more individuals. In April, the British Columbia Court of Appeal narrowed the scope of the tribal court s ruling, holding that only those affected since 1985, a group thought to number several thousands, were entitled to have their Indian status restored. Moreover, the Court gave the government one year to amend the Indian Act s definition of Indian status. Meanwhile, the McIvors have appealed to Canada s highest court to reinstate the trial judge s broader mandate. Selected Court Decisions In Philip Morris USA, Inc. v. King Mountain Tobacco Co., 2009 WL (9th Cir. 2009), Philip Morris (PM) sued King Mountain Tobacco (KMT), a cigarette company owned by members of the Yakama Tribe, for infringing PM s Marlboro trademarks and trade dress in violation. KMT then sued for declaratory judgment in the Yakama Tribal Court. PM then asked the federal court to enjoin the tribal court proceedings. KMT requested that the federal court stay proceedings on the injunction motion pending the tribal court s determination of its own jurisdiction. The district court granted the stay, finding that tribal court jurisdiction was colorable but the Ninth Circuit Court of Appeals, applying Montana v. United States, Strate v. A-1 Contractors, and Nevada v. Hicks, reversed, rejecting PM s contracts with reservation stores as a jurisdictional basis: a tribal court has jurisdiction over a nonmember only where the claim has a nexus to the consensual relationship between the nonmember and the disputed commercial contacts with the tribe. In United States v. Oldbear, 568 F.3d 814, 2009 WL (10th Cir.), a member of the Cheyenne-Arapaho Indian Tribes, used funds from the Tribes emergency assistance program to repair one of her personal vehicles and to purchase another. A federal jury convicted her of five counts of embezzling Indian tribal funds in violation of 18 U.S.C and one count of making a false statement to a government agent in violation of 18 U.S.C. 1001(a)(2). On appeal, Oldbear contended that (1) the district court violated her constitutional rights when it excluded testimony from three defense witnesses who also received tribal funds for personal purposes; (2) her convictions should be overturned for lack of evidence; and (3) the district court improperly allowed the prosecutor to cross-examine

3 3 her regarding another instance of embezzlement, thus causing her to prejudicially invoke her Fifth Amendment right against selfincrimination. The Tenth Circuit Court of Appeals rejected all these arguments and affirmed. In Oglala Sioux Tribe v. United States Army Corps of Engineers, 2009 WL (D.C. Cir.), the Tribe brought a declaratory judgment action against the Army Corps, seeking a declaration that the 1889 Act of Congress dissolving the Great Sioux Reservation never took effect. In addition, the Tribe requested an injunction preventing the United States from transferring title to any land inside the former Reservation without the Tribe s permission and a writ of mandamus under the National Historic Preservation Act compelling the Army Corps of Engineers to evaluate the Missouri River properties for inclusion in the National Register of Historic Places. The D.C. Circuit Court held that the Tribe s first three claims, all based on the invalidity of the 1889 act, were barred pursuant to the Indian Claims Commission Act requirement that claims be brought by August 13, 1951: The Tribe s first three claims would require the court to decide whether to rescind the Sioux Tribe s agreements with the United States approving the 1889 Act s diminishment of the Great Sioux Reservation, to declare that Act null and void, and to treat the area as if the 1868 Treaty had not been modified. The Tribe surely knew that such an action arose before The Court also denied the Tribe s mandamus petition: Because the Tribe did not come close to demonstrating that the Act imposes a clear and compelling duty on agencies to evaluate all historic properties under their jurisdiction on any particular timetable, the district court had no choice but to dismiss its mandamus claim. In Keweenaw Bay Indian Community v. Rising, 2009 WL (6th Cir.), the Keweenaw Bay Indian Community (Tribe) and the State of Michigan had previously entered into a tax agreement. When the agreement expired, the State assessed certain sales and use taxes against the Tribe and, when the Tribe declined to pay them, set the amount of the alleged taxes off against payments due the Tribe under various federal programs (Medicaid, WIC, Federal Safe and Stable Families, and Federal Child Day Care). The Tribe sought prospective declaratory relief that the set-offs and any future set-offs were illegal and sought injunctive relief requiring the State to restore the payments. More broadly, the Tribe contended that the State s imposition of the sales and use taxes violated the Civil Rights Act of 1870 (42 U.S.C. 1983) and federal Indian tax law. The district granted summary judgment in favor of the State. On appeal, the Sixth Circuit held that (1) it would not rule on the State s right to collect sales and use taxes within the Tribe s reservation because there were no allegations of an erroneous refusal to refund by the State, (2) the Tribe s 1842 treaty with the United States did not impose an independent barrier to the State s collection of taxes, and (3) whether the Tribe could bring an action against State officials under the 1871 Civil Rights Act, 42 U.S.C depended on whether its claim for federal funds was based on its sovereign status or its status as a social services provider, a determination to be made by the district court on remand. United Keetoowah Band of Cherokee Indians v. United States Department of Housing and Urban Development (HUD), et al., 567 F.3d 1235, 2009 WL (10th Cir.), involved a dispute between the United Keetoowah Band of Cherokee Indians (UKB) and the Cherokee Nation of Oklahoma (CNO) over UKB s eligibility for funding under the Native American Housing and Self-Determination Act (NAHASDA), with CNO arguing that, under HUD rules, UKB lacked court jurisdiction to support a formula area and was, therefore, was eligible for only the minimum NAHASDA block grant. HUD agreed but UKB sought judicial review under the Administrative Procedures Act. The Tenth Circuit Court of Appeals, in a 2-1 decision, reversed, holding that (1) HUD s interpretation of NAHASDA was not entitled to deference under the rule of Chevron because Congress explicitly and unambiguously mandated an allocation formula based on need and the area within which the tribe provides assistance, without regard to court jurisdiction, (2) HUD s requirement that a tribe demonstrate court jurisdiction is contrary to Congress plainly expressed intent because it leads to funding allocations based on factors that do not reflect tribal housing needs, and (3) it is irrelevant that the rule was adopted through negotiated rule-making. In Smith v. Shulman, 2009 WL (2d Cir.), Smith, a member of the Shinnecock Tribe, an entity seeking recognition from the federal government, sued the commissioner of the Internal Revenue Service (IRS) to obtain a refund, injunctive relief, and a declaration that IRS illegally assessed taxes, penalties, and interest on income that Smith earned on the Shinnecock Indian Reservation in tax year Smith contended that the income was not subject to the income tax. The district court dismissed for lack of subject matter jurisdiction and the Second Circuit Court of Appeals affirmed holding that (1) insofar as Smith was attempting to appeal the adverse decision of the due process hearing officer, his recourse was to the United States Tax Court, which has exclusive jurisdiction over such matters, (2) with respect to the claim for refund, Smith was statutorily required to file an administrative claim and pay the tax in full prior to filing suit in the district court, and (3) Smith s attempt to obtain an injunction against IRS collection of income tax is barred by the Tax Anti- Injunction Act, and Smith failed to demonstrate that there were no circumstances under which the government could prevail. In Pyke, et al. v. Cuomo, et al., 567 F.3d 74 (2d. Cir. 2009), Pyke and other plaintiffs sued state officials pursuant to 42 U.S.C. 1983, alleging that they violated the equal protection guarantee of the Fourteenth Amendment by (1) setting up roadblocks at the edge of the Mohawk reservation either to stop non-residents from entering the reservation or else to give them information about the ongoing strife, (2) informing the Mohawk Warrior Society whenever police entered the reservation, and (3) discontinuing regular patrols inside the reservation. The district court granted the defendants summary judgment and the court of appeals affirmed, holding that measures adopted were not based on racial classifications but on efforts to avoid violence and perhaps even to show respect for the sovereignty of the Mohawks. Viewed at its worst, it was horribly misguided policing that effectively meant caving in to the demands of a criminal organization and ceding to it control over the protection of thousands of Mohawks. But even on this most negative reading, the notification policy was not an express racial classification. In Red Lake Band of Chippewa v. U.S. Department of Interior, 2009 WL (D.D.C.), the Tribe sued the Department of Interior (DOI) and DOI officials, alleging breach of provisions of the parties Compact of Self-Governance and accompanying agreements entered into pursuant to the Indian Self-Determination and Education

4 4 Indian Nations Law Update Assistance Act. Specifically, the Tribe alleged that the defendants (1) failed to obtain, assist the Tribe in obtaining, and/or request funding for the Tribe s new juvenile correction facility, (2) failed to notify the Tribe of the availability of year-end funding, and (3) failed to timely provide the Tribe with certain pay cost analyses and the full amount of pay cost increases, as required under the parties contract. The district court held that (1) language in the contract that [t]he BIA agrees to assist the Tribe in obtaining $1,218,482 for operations funding for the Tribes [sic] juvenile correction facility was not a legally binding commitment to obtain funding but was a legally binding commitment to assist Tribe, (2) the government breached its duty to assist the Tribe in obtaining funding, (3) the government breached a contractual commitment to request that funding for the Tribe s correctional facility be included in the 2006 budget, (4) disputed issues of fact precluded summary judgment with respect to the Tribe s damages with respect to the aforementioned breaches, (4) the DOI was entitled to summary judgment on the claim that DOI had failed to notify the Tribe of available funds, and (5) the government would be ordered to provide pay cost data required by contract. In United Keetoowah Band of Cherokee Indians v. Kempthorne, 2009 WL (E.D.Okla.), the Indian Health Service (IHS) had entered into an agreement with the Cherokee Nation of Oklahoma under the Indian Self-Determination Act, pursuant to which the Tribe assume ownership and operation of a health clinic in Tahlequah, Oklahoma. The United Keetoowah Band of Cherokee Indians ( UKB ) sued IHS, seeking a federal court declaration that the contract between Cherokee Nation and IHS was unlawful. The Cherokee Nation moved to dismiss, arguing that it was a required part under Fed.R.Civ. Proc. 19 but could not be joined because of its sovereign immunity. The court agreed: Although the UKB may not have an alternative forum in which to pursue its present claim if the case is dismissed for nonjoinder, this result is contemplated under the doctrine of tribal sovereign immunity. Dismissal based on tribal sovereign immunity, despite the lack of an available alternative forum is less troublesome than in other cases because dismissal turns on the fact that society has consciously opted to shield Indian tribes from suit. In United States v. Duro, 2009 WL (C.D.Cal.), Duro, a member of the Torrez Martinez Indian reservation in California, and his company, Desert Mobile-home Park, Inc. ( Park ), operated a mobile home park on an allotment owned by Duro. The Park, a village inhabited by thousands of residents including some undocumented farm workers, was targeted by state, federal and local officials because of widespread health and safety hazards. The government sued to close the Park based on Duro s violation of state standards relating to mobile parks and failure to obtain a BIAapproved lease pursuant to 25 U.S.C The court held that (1) state standards did not apply on the reservation, (2) the Tribe lacked relevant ordinances, (3) Duro was required by law to obtain a BIA-approved lease to operate his business and had deliberately ignored this obligation, (4) BIA had failed in its duty to assist Duro, (5) pending construction of replacement housing, the court would order a receiver to oversee the Park and remediation of its health and safety hazards. In Pakootas, et al. v. Teck Cominco Metals, LTD, 2009 WL (E.D.Wash.), the Confederated Tribes of the Colville Reservation and members of the Tribes sued Teck Cominco Metals (Teck), a mining company, for contamination of Lake Roosevelt, which borders the Tribes reservation. Teck asserted two counterclaims against the Tribes under the Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA), contending the Tribes caused and contributed to the hazardous substances contamination of Lake Roosevelt. The Tribes moved to dismiss, contending that they were not persons subject to liability under the CERCLA. The court agreed: Whereas CERCLA specifically provides for liability to an Indian tribe,, it contains no specific provision for the liability of an Indian tribe. If Congress intended to make Indian tribes liable under CERCLA, one has to ask why it did not specifically include Indian tribes among the entities covered by the term person in Section 9601(21), nor specifically define municipality, association, or consortium to include Indian tribes. In Absentee Shawnee Tribe and Thunderbird Entertainment Center, Inc. v. Combs, 2009 WL (W.D.Okla.), Bittle, a nonmember of the Tribe, had brought an action in Oklahoma state court against Thunderbird Entertainment Center, Inc., a corporation formed under tribal law and owned by the Tribe (Thunderbird), and certain of its employees after she suffered injuries in a traffic accident caused, she alleged, because Thunderbird employees negligently served excessive amounts of alcohol to Valentine Bahe or Val Tsosie (or both) at the Thunderbird Entertainment Center, on tribal land. The judge in the state court action, Combs, dismissed for lack of subject matter jurisdiction but the Oklahoma Supreme Court concluded that the Oklahoma District Court of Pottawatomie County had jurisdiction because the Tribe and the Thunderbird Entertainment Center had no immunity with respect to Ms. Bittle s negligence claim, which was remanded to Judge Combs for further proceedings. The Tribe then filed an action in federal court to enjoin further proceedings based on its sovereign immunity but the court denied the motion, holding that (1) application of state alcoholic beverage licensing laws to the tribes does not impair a right granted or reserved by federal law to the tribes, (2) the Oklahoma Supreme Court correctly found that the Tribe waived its immunity when it applied for a state license to sell alcohol and agreed to be bound by the laws of the State of Oklahoma, (3) the court lacked jurisdiction to review decisions of the Oklahoma Supreme Court, such review being reserved to the U.S. Supreme Court, (4) the doctrine of issue preclusion based on previous litigation precluded re-litigation, and (5) relitigation was barred by the Anti-Injunction Act. In Citizens Potawatomi Nation v. Salazar, 2009 WL (D.D.C.), Bureau of Indian Affairs (BIA), in 1988, reached an agreement with tribes within the jurisdiction of the Shawnee Agency that federal funds pursuant to the Indian Self-Determination Act (ISDA) would be allocated among the tribes under a formula taking into accounts the tribes enrollment, resident tribal population, and extent of trust lands. Citizens Potawatomi Nation (CPN) sued after it learned that BIA was applying the 1988 formula without annual adjustments to take into account demographic changes. Interior Board of Indian Affairs (IBIA) upheld the BIA s practice on the ground that the language of the 1988 agreement was ambiguous and BIA s interpretation plausible. CPN sought judicial review pursuant to the Administrative Procedures Act and the D.C. district court affirmed, holding that (1) CPN s claims must be dismissed for failure to join required parties, the other Agency tribes, whose interests were

5 5 affected but whose immunity made joinder impossible, (2) BIA s decision was not arbitrary and capricious and would be upheld. In Nahno-Lopez, et al., v. Houser, et al., 2009 WL (W.D.Okla.), plaintiffs included tribal member owners of more than 50% of an allotment known as Comanche Allotment No ( Allotment ) and holders of a BIA-approved lease of the Allotment. The plaintiffs sued six officials of the Fort Sill Apache Tribe of Oklahoma, members of the Tribe s Tribal Council, the manager of the Fort Sill Apache Tribe and the Fort Sill Apache Casino, alleging that the defendants violated federal law by constructing a parking lot for the Casino without authorization. On the defendants motion to dismiss, the district court held that (1) federal question jurisdiction was provided by 25 U.S.C. 345, which provides a cause of action for claims brought by allottees in relation to the claimed right of a person of Indian descent to land that was once allotted, (2) the Indian Non-Intercourse Act and the Long Term Leasing Act and provisions of the General Allotment Act restricting alienation of allotments did not provide federal jurisdiction, (3) claims against the casino and individuals sued in their official capacities would be dismissed on sovereign immunity grounds because the relief requested, if granted, would, in actuality, amount to relief against the Tribe, (4) claims against the individual defendants for seeking damages from them personally, based on wrongful conduct fairly attributable to the individual himself or herself, would not be dismissed, and (5) the court would exercise supplemental jurisdiction over the state law claims based on trespass. In Native American Arts, Inc. v. Mangalick Enterprises, Inc WL (N.D.Ill.), the plaintiff, Native American Arts, Inc. ( NAA ), a Native American arts and crafts organization, sued Mangalick under the Indian Arts and Crafts Act of 1990, as amended by the Indian Arts and Crafts Enforcement Act of 2000) ( the Act ), alleging that Mangalick sold inauthentic Indian goods in a manner that falsely suggested they were authentic. Managlick moved to dismiss, alleging that the plaintiff lacked standing and that the act violated the due process and equal protection provisions of the U.S. Constitution. The court denied the motion, holding that (1) the Act was not a raciallybased preference but, rather, was based on the federal government s unique relationship with tribes, (2) the Act had a rational basis for the law (to protect Indian artists from unfair competition from counterfeiters and to protect consumers from unknowingly purchasing imitation products) and was therefore constitutional, and (3) NAA s allegations that Managlick s actions cost NAA lost sales, depressed prices and lost goodwill were sufficient to confer standing. Ute Distribution Corporation v. Secretary of the Interior, et al WL (D.Utah), addressed water rights under the Ute Partition and Termination Act (UPA) of The UPA provided for the partition and distribution of the assets of the Ute Indian Tribe between the full-blood group, for whom federal supervision would continue, and the mixed-blood group, for whom such supervision would end. The Ute Distribution Corporation (UDC) was formed by the Affiliated Ute Citizens of Utah ( AUC ), the authorized representative of the mixed blood group, in 1958 to manage all unadjudicated or unliquidated claims against the United States jointly with the Tribal Business Committee. In 1995, the UDC sought a declaratory judgment that tribal water rights were not divided and distributed in 1961 but remain in trust for the benefit of mixed-blood and full-blood members of the Tribe; and that they are subject to joint management by the UDC and the Tribal Business Committee. After a remand, the Secretary ruled that t the tribal water rights of the Ute Indian Tribe were an asset susceptible to equitable and practicable distribution and that had been divided and distributed as appurtenant to the land in On judicial review pursuant to the Administrative Procedures Act, the federal district court upheld the Secretary s determination. In Sweet, et al. v. Hinzman, et al WL (W.D.Wash.), the petitioners sued members of the Snoqualmie Indian Tribal Council, in their official capacities, seeking writs of habeas corpus under the Indian Civil Rights Act ( ICRA ), alleging that their banishment from the Tribe for alleged acts of treason violated the Indian Civil Rights Act (ICRA) and imposed a severe restraint on their personal liberty in the form of denied access to health care and tribal employment opportunities, exclusion from tribal lands and loss of tribal identity. The respondents moved to dismiss but the court denied the motion, holding that (1) federal courts have jurisdiction to review disputes regarding loss of tribal membership and banishment under the habeas corpus provisions of the ICRA, (2) petitioners allegations that there were no tribal remedies were sufficient to survive a motion to dismiss, and (3) neither the Tribe nor its General Membership Council was an indispensable party in view of the dominant role the individual tribal council members played in the petitioners banishment. Attorney s Process and Investigation, Inc. v. Sac & Fox Tribe of the Mississippi in Iowa, 2009 WL (N.D.Iowa), arose out of a dispute within the Sac & Fox Tribe during that resulted in the replacement of the Walker Council with a new government, known as the Old Bear Council. The Old Bear Council had been elected in a May 2003 election that BIA declined to recognize. (The Old Bear Council was also successful in an election in fall, 2003). On June 16, 2003, the Walker Council purported to enter into an agreement with Attorney s Process and Investigation, Inc (API) on behalf of the Tribe ( Agreement ) pursuant to which API would investigate a takeover of the casino by supporters of Old Bear. On October 1, 2003, after the Old Bear Council had assumed effective control of the government, approximately thirty individuals associated with API, some armed, stormed the Casino, seized and damaged tribal property, assaulted and falsely imprisoned Tribe members and employees, and took control of financial records, surveillance records, ongoing gaming investigation files, personnel files and legal files. In 2005, the Tribe sued API in tribal court, alleging trespass, theft of tribal funds and misappropriation of trade secrets. The tribal court rejected API s challenges to its jurisdiction. After exhausting tribal court appeals on the jurisdiction issue, API sued in federal court to prevent the tribal court from exercising jurisdiction and for breach of its contract with the Walker Council. The federal court dismissed, holding that (1) the federal court had jurisdiction to hear the challenge to the tribal court s jurisdiction, notwithstanding the Tribe s immunity, (2) API could not bring federal claims based on breach of its contract with the Walker contract because the tribal court had held that the Walker Council was without authority, (3) the tribal court had jurisdiction over API under the rule of United States v. Montana that a tribe may exercise jurisdiction over nonmembers when their conduct on tribal land threatens or has some direct effect on the political integrity, the

6 Receive Future Client Updates and Alerts Via If you would prefer to receive this type of information by , please send your name, address, phone number and address to economic security, or the health and welfare of the tribe. In Ho-Chunk Nation v. Wisconsin Department of Revenue, 766 N.W.2d 738,2009 WI 48 (Wis.2009), the Nation sought a refund of cigarette taxes under a state statute that authorized partial refunds for cigarette taxes provided the tax was collected on sales made on land that was designated a reservation or trust land on or before January 1, The Nation argued that land that BIA had approved for purchased in 1982 satisfied the statute s requirement even though the United States did not take title in trust until January 31, The state court of appeals disagreed and the Supreme Court, in a 4-3 decision, affirmed: Given that there is no basis in the federal regulations for recognizing a preliminary, unofficial status for reservations or trust lands, there is likewise no basis for reading this statute as intending to apply to land that has received only preliminary informal approval. Three dissenting justices argued that designated was an ambiguous term, that ambiguities are to be construed in favor of tribes, that the parties involved in drafting the legislation were aware that the Tribe had acquired the land in question for smoke shop purposes, and that the land was formally taken into trust before the effective date of the legislation. In State ex rel. Dewberry, et al. v. Kulongoski, 2009 WL (Ore.), residents of Florence, Oregon, the site of a proposed tribal casino, filed a petition for a writ of mandamus in county circuit court in 2003, challenging Governor Kulongoski s authority to enter into a gaming compact with the Confederated Tribes of Coos, Lower Umpqua, and Suislaw Indians (the Tribes) near Florence. The trial court dismissed relators petition on the grounds that they had (1) failed to show they had no adequate remedy at law, and (2) failed to join the Tribes in the action. The Court of Appeals reversed and remanded for further proceedings in the circuit court. The Oregon Supreme Court affirmed, holding that the relators had no adequate alternative remedy since relief in that action depends solely on the Tribes discretion in choosing whether to assert sovereign immunity. In State of North Carolina ex rel. Cooper v. Seneca-Cayuga Tobacco Company, 676 S.E.2d 579 (N.C. App. 2009), the State sued tribal tobacco companies, seeking preliminary and permanent injunctions requiring them to pay into an escrow fund established pursuant to the Master Settlement Agreement between the states and large tobacco companies, to file a certificate of compliance, and to cease selling tobacco products in North Carolina for two years. The tribally owned companies filed motion to dismiss, which was granted. The Court of Appeals affirmed, holding that the companies had not waived their sovereign immunity, and thus the court lacked jurisdiction over them. In Meherrin Indian Tribe, et al. v. Lewis et al., 2009 WL (N.C.App.), a faction of a staterecognized, but not federally recognized, tribe sued another factor over control of the tribe. The defendants moved to dismiss on sovereign immunity grounds but the motion was denied. The court of appeals affirmed: The Meherrin Tribe has no reservation. The Tribe has not been recognized by the federal government. The constitution of the Tribe has no functioning judiciary for resolution of intra-tribal disputes to which this dispute could be referred prior to litigation. The sole source of legal authority of the Tribe flows from N.C. Gen. Stat. 71A-7.1 While indigenous tribes may enjoy sovereign immunity over some disputes, the predicate facts which would present a sovereign immunity defense are not present here. In Holguin v. Tsay Corporation, 2009 WL (N.M.App.), Holguin, a patron of a tribally owned casino, sought to rely on a waiver of tribal sovereign immunity for bodily injury, contained in the Tribe s Class III Gaming Compact, to sue a tribally owned corporation (Tsay) for breach of contract, conversion, unfair practices, and for two counts of invasion of privacy after the Tribe allegedly refused to pay him $250,000 and instead required him to elect to receive either $125,000 less income tax withholding or to receive payment of $250,000 spread over a period of [twenty] years. The district court granted Tsay s motion as to three counts, but denied Tsay s motion as to two counts of invasion of privacy. The Court of Appeals reversed and ordered the trial court to dismiss the remaining claims: Holguin has presented no argument or authority that overcomes the controlling law requiring physical injury or damage. Indian Nations Team Members Appleton office: Michael Lokensgard (mlokensgard@gklaw.com) Choua Vang (cvang@gklaw.com) Green Bay office: Ronald Pfeifer (rpfeifer@gklaw.com) Madison office: Jed Roher (jroher@gklaw.com) Mike Wittenwyler (mwittenwyler@gklaw.com) Milwaukee office: Carl Artman (cartman@gklaw.com) Debra Baesemann (dbaesemann@gklaw.com) John Clancy (jclancy@gklaw.com) Todd Cleary (tcleary@gklaw.com) Daniel Geraghty (dgeraghty@gklaw.com) Thomas Griggs (tgriggs@gklaw.com) Arthur Harrington (aharrington@gklaw.com) Brett Koeller (bkoeller@gklaw.com) Carol Muratore (cmuratore@gklaw.com) Tom O Day (today@gklaw.com) Brian Pierson (bpierson@gklaw.com) Roxana Wizorek (rwizorek@gklaw.com) Offices in Milwaukee, Madison, Waukesha, Green Bay & Appleton, WI; Washington, DC & Shanghai, PRC