UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT

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1 Appellate Case: Document: Date Filed: 01/05/2015 Page: 1 UNITED STATES COURT OF APPEALS FOR THE TENTH CIRCUIT No STATE OF WYOMING, Petitioner, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, et al., Respondents, and THE NORTHERN ARAPAHO TRIBE, et al., Intervenors. No WYOMING FARM BUREAU FEDERATION, Petitioner, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, et al., Respondents, and THE NORTHERN ARAPAHO TRIBE, et al., Intervenors

2 Appellate Case: Document: Date Filed: 01/05/2015 Page: 2 No DEVON ENERGY PRODUCTION COMPANY, L.P., Petitioner, v. UNITED STATES ENVIRONMENTAL PROTECTION AGENCY, et al., Respondents, and THE NORTHERN ARAPAHO TRIBE, et al. Intervenors. BRIEF OF AMICI CURIAE STATES OF IDAHO, ALABAMA, COLORADO, KANSAS, MONTANA, NEBRASKA, NORTH DAKOTA, OKLAHOMA, SOUTH DAKOTA AND UTAH IN SUPPORT OF PETITIONERS AS TO STANDARD OF REVIEW HON. LAWRENCE G. WASDEN Attorney General STEVEN L. OLSEN Chief of Civil Litigation CLAY R. SMITH Deputy Attorney General Statehouse, Room 210 Boise, ID Counsel for Amici Curiae States (Additional counsel listed inside cover)

3 Appellate Case: Document: Date Filed: 01/05/2015 Page: 3 Additional Counsel Wayne Stenehjem Attorney General State of North Dakota State Capitol 600 E. Boulevard Avenue Dept. 125 Bismark, ND Derek Schmidt Attorney General State of Kansas 120 SW 10th Avenue, 2nd Floor Topeka, KS Sean D. Reyes Attorney General State of Utah P.O. Box Salt Lake City, UT John Suthers Attorney General State of Colorado Ralph L. Carter Colorado Judicial Center 1300 Broadway, 10th Floor Denver, CO Tim Fox Attorney General State of Montana P.O. Box Helena, MT E. Scott Pruitt Attorney General State of Oklahoma 313 N.E. 21st Street Oklahoma City, OK Luther Strange Attorney General State of Alabama P.O. Box Montgomery, AL Marty Jackley Attorney General State of South Dakota 1302 E. Hwy 14, Suite 1 Pierre, SD Jon Bruning Attorney General State of Nebraska 2115 State Capitol Lincoln, NE 68509

4 Appellate Case: Document: Date Filed: 01/05/2015 Page: 4 TABLE OF CONTENTS INTEREST OF AMICUS CURIAE STATES... 1 ARGUMENT... 3 I. THE 1998 TRIBAL AUTHORITY RULE RECOGNIZES THAT FEDERAL COMMON LAW GOVERNS DETERMINATION OF RESERVATION STATUS AND RELATED TERRITORIAL JURISDICTION ISSUES... 3 II. EPA S APPLICATION OF FEDERAL COMMON LAW RESERVATION DIMINISHMENT PRINCIPLES TO HISTORICAL FACTS FOR PURPOSES OF DETERMINING THE WIND RIVER INDIAN RESERVATION S EXTERIOR BOUNDARIES IS SUBJECT TO DE NOVO REVIEW... 6 CONCLUSION CERTIFICATE OF COMPLIANCE i

5 Appellate Case: Document: Date Filed: 01/05/2015 Page: 5 TABLE OF CASES AND AUTHORITIES CASES Ariz. Pub. Serv. Co. v. EPA, 211 F.3d 1280 (D.C. Cir. 2000)... passim Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984)... 5, 10 Colorado Public Utilities Commission v. Harmon, 951 F.2d 1571 (10th Cir. 1991)... 7 Ex parte Young, 208 U.S. 123 (1908)... 1 Idaho v. Coeur d Alene Tribe, 521 U.S. 261 (1997)... 1 Idaho v. United States, 533 U.S. 262 (2001)... 1 Liberty Mut. Ins. Co. v. Commercial Union Ins. Co., 978 F.2d 750 (1st Cir. 1992)... 8 Maine v. Johnson, 498 F.3d 37 (1st Cir. 2007)... 9, 10 Michigan v. EPA, 268 F.3d 1075 (D.C. Cir. 2001)... 2, 6 Minnesota v. Mille Lacs Band of Chippewa Indians, 526 U.S. 172 (1999)... 2 Montana v. USEPA, 137 F.3d 1135 (9th Cir. 1998)... 8, 9 Morris v. Commodity Futures Trading Commission, 980 F.2d 1289 (9th Cir. 1992)... 8 Nat l Min. Ass n v. Sec y, 153 F.3d 1264 (11th Cir. 1998)... 8 Oklahoma Dep t of Envt l Quality v. EPA, 740 F.3d 185 (D.C. Cir. 2014)... 6 ii

6 Appellate Case: Document: Date Filed: 01/05/2015 Page: 6 Oklahoma Tax Comm n v. Citizen Band Potawatomi Indian Tribe, 498 U.S. 505 (1991)... 4 Skidmore v. Swift & Co., 323 U.S. 134 (1944) Solem v. Bartlett, 465 U.S. 463 (1984) AUTHORITIES United States Code 18 U.S.C U.S.C to U.S.C. 1811(a) U.S.C. 1811(a)(6) U.S.C to U.S.C. 7601(d) U.S.C. 7601(d)(2)(B)... 3, 4 Other Statutes 33 Stat M.R.S.A to M.R.S.A. 6206(1) Regulations 56 Fed. Reg. 64,876 (Dec. 12, 1991) Fed. Reg (Feb. 1998) Fed. Reg Fed. Reg Fed. Reg. 45,684 (proposed Jul. 10, 2002)... 6 iii

7 Appellate Case: Document: Date Filed: 01/05/2015 Page: 7 INTEREST OF AMICUS CURIAE STATES States view territorial integrity as an essential component of their entry into the Union. The significance of this interest perhaps finds its clearest expression in the Equal Footing Doctrine developed to protect, upon admission to statehood, their ownership in the bed and banks of navigable waters. As Justice Kennedy explained in Idaho v. Coeur d Alene Tribe, 521 U.S. 261 (1997), in rejecting application of the Ex parte Young 1 fiction to action by a tribe to confirm ownership in a portion of a navigable lake, the requested relief would divest the State of its sovereign control over submerged lands, lands with a unique status in the law and infused with a public trust the State itself is bound to respect and whose ownership has been considered an essential attribute of sovereignty. Id. at 283. The Supreme Court reiterated the interest s significance although finding the requisite congressional expression of an intent to withhold the involved submerged lands from state ownership four years later in Idaho v. United States, 533 U.S. 262 (2001), where it observed that [d]ue to the public importance of navigable waterways, ownership of the land underlying such waters is strongly identified with the sovereign power of government. Id. at 272. To be sure, this judicial review proceeding does not involve ownership of a navigable watercourse, but it does present squarely issues going to one aspect of 1 Ex parte Young, 208 U.S. 123 (1908). 1

8 Appellate Case: Document: Date Filed: 01/05/2015 Page: 8 Wyoming s territorial sovereignty governmental control. The question here is not whether, for example, a tribe has certain usufructuary rights on lands otherwise subject to state regulation (see Minnesota v. Mille Lacs Band of Chippewa Indians, 526 U.S. 172, (1999)), it instead is whether lands retain Indian reservation status and, as such, are subject to a complex set of statutory and federal common law rules that substantially diminish state regulatory authority. As the Court of Appeals for the District of Columbia explained in Michigan v. EPA, 268 F.3d 1075 (D.C. Cir. 2001), [d]etermining tribal jurisdiction is far from straightforward and involves delicate questions involving state and tribal sovereignty. Id. at It added that [d]ifficult jurisdictional questions can arise over lands that do not meet the prima facie test for Indian country. Id. at Such is the case now. The amicus curiae States take no position on the substantive issue raised by the Environmental Protection Agency s conclusion that the Wind River Reservation was not diminished by the Act of March 3, 1905, 33 Stat They seek only to make plain that an administrative agency is owed no deference with respect to its application of federal common law principles to historical facts. This Court, in short, has de novo review authority over that question of law because it falls outside the scope of the agency s unique expertise. Wyoming s and the other parties views on the diminishment issue accordingly have as much weight as the Environmental Protection Agency s. Any other result 2

9 Appellate Case: Document: Date Filed: 01/05/2015 Page: 9 not only runs counter to relevant decisional authority but also commits the States sovereign territorial and regulatory interests to potential erosion by an agency s error in resolving the [d]ifficult jurisdictional questions presented in reservation diminishment litigation. ARGUMENT I. THE 1998 TRIBAL AUTHORITY RULE RECOGNIZES THAT FEDERAL COMMON LAW GOVERNS DETERMINATION OF RESERVATION STATUS AND RELATED TERRITORIAL JURISDICTION ISSUES Under the Clean Air Act ( CAA or Act ), 42 U.S.C to 7431, Respondent Environmental Protection Agency ( EPA or Agency ) has authority to treat Indian tribes as States. Id. 7601(d). This authority comes with certain conditions, including the requirement that the functions to be exercised by the Indian tribe pertain to the management and protection of air resources within the exterior boundaries of the reservation or other areas within the tribe's jurisdiction. Id. 7601(d)(2)(B). The CAA itself does not define the term reservation or, for that matter, the phrase other areas within the tribe s jurisdiction. EPA filled this definitional vacuum with a final rule concerning application of the treatment as a state ( TAS ) provision issued in 1998, commonly referred to as the Tribal Authority Rule. Indian Tribes: Air Quality Planning and Management, 63 Fed. Reg (Feb. 12, 1998). The Tribal Authority Rule addressed various nettlesome questions, including 3

10 Appellate Case: Document: Date Filed: 01/05/2015 Page: 10 whether the Act s TAS provision demanded an independent showing of tribal regulatory jurisdiction within the exterior boundaries of a reservation to satisfy 7601(d)(2)(B) or embodied a delegation of CAA regulatory authority; what lands Congress intended to include within the term reservation; and whether an independent showing of tribal regulatory jurisdiction was necessary as to areas outside a reservation for 7601(d)(2)(B) purposes. The Agency s analysis as to the latter two questions is germane here. As to reservation, EPA reasoned that the term should be interpreted in light of Supreme Court case law, including Oklahoma Tax Comm n [v. Citizen Band Potawatomi Indian Tribe, 498 U.S. 505 (1991)], in which the Supreme Court held that a reservation, in addition to the common understanding of the term, also includes trust lands that have been validly set apart for the use of a tribe even though the land has not been formally designated as a reservation. In applying this precedent to construe the term reservation in the context of the CWA, the Agency has only recognized two categories of lands that, even though they are not formally designated as reservations, nonetheless qualify as reservations : Pueblos and tribal trust lands. EPA will consider lands held in fee by nonmembers within a Pueblo to be part of a reservation[.] 63 Fed. Reg. at 7258 (emphasis added except as to case citation). The Agency added that it would determine on a case-by-case basis whether other types of lands under federal Indian law may be considered reservations under federal law even though they are not formally designated as such a determination dependent on the particular status of land in question and on the interpretation of relevant Supreme Court precedent. Id. (emphasis added). 4

11 Appellate Case: Document: Date Filed: 01/05/2015 Page: 11 As to other areas within the tribe s jurisdiction, the Agency stated that Congress had not intended to delegate as it had with respect to reservations CAA implementation powers. Rather, a tribe seeking to implement a CAA program over non-reservation areas may do so only if it has authority over such areas under general principles of federal Indian law. 63 Fed. Reg In that regard, EPA suggested that its application of the phrase would be informed by the definition of Indian country in 18 U.S.C implicitly referring to the statute s dependent Indian communities and Indian allotments components. But it deferred resolution of disputes over the phrase s scope to a case-by-case basis in the context of particular tribal applications. Id. In sum, a tribe may implement a CAA program over sources in non-reservation areas, including ceded territories, if the tribe can demonstrate its authority over such sources under federal Indian law. Id. The Court of Appeals for the District of Columbia Circuit subsequently rejected a broad-based challenge to the Tribal Authority Rule. Ariz. Pub. Serv. Co. v. EPA, 211 F.3d 1280 (D.C. Cir. 2000). It extended Chevron 2 deference to EPA s construction of reservation to include not only formal reservations but also Pueblos and trust lands, noting in part that the Agency supported its interpretation... by looking to relevant case law. Id. at The court further 2 Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984). 5

12 Appellate Case: Document: Date Filed: 01/05/2015 Page: 12 upheld the extension of tribal implementation plan authority to dependent Indian communities and allotted lands to the extent that tribes can establish on a case-bycase basis that they possess regulatory authority pursuant to demonstrated inherent sovereign power. Id. at Arizona Public Service accordingly endorsed EPA s use of federal common law to determine not only reservation, dependent Indian community and allotted land status but also the scope of inherent tribal authority with respect to TAS applications for non-reservation land. 3 II. EPA S APPLICATION OF FEDERAL COMMON LAW RESERVATION DIMINISHMENT PRINCIPLES TO HISTORICAL FACTS FOR PURPOSES OF DETERMINING THE WIND RIVER INDIAN RESERVATION S EXTERIOR BOUNDARIES IS SUBJECT TO DE NOVO REVIEW A threshold issue in this appeal is the standard of review under which EPA s TAS determination as to reservation status must be examined. In opposing 3 The Agency s obligation in this regard has no exceptions. See Oklahoma Dep t of Envt l Quality v. EPA, 740 F.3d 185, 195 (D.C. Cir. 2014) ( [w]hen regulating in the shoes of a tribe,... the EPA is subject to the same limitations as the tribe itself and therefore must demonstrate tribal jurisdiction before it may exercise CAA jurisdiction over non-reservation Indian country ); Michigan v. EPA, 268 F.3d at 1084 ( EPA cannot acquire jurisdiction for itself merely by determining that an area's status is in question. Were we to hold otherwise, EPA would effectively have a blank check to expand its own jurisdiction by not deciding jurisdictional questions. ). It warrants noting that EPA has not hesitated to employ Arizona Public Service as a precedential sword. See Approval and Promulgation of Air Quality Implementation Plans, 67 Fed. Reg. 45,684, 45,686 (proposed Jul. 10, 2002) (advising South Dakota in a dispute over the reservation status of trust lands that the State was bound to follow the decision of the [Arizona Public Service] Court in this matter and may not now challenge the very issue which has already been litigation on the merits in the D.C. Circuit and upon which EPA has prevailed ). 6

13 Appellate Case: Document: Date Filed: 01/05/2015 Page: 13 Wyoming s motion directed to the content of the administrative record, the Agency identified the standard as arbitrary and capricious. EPA s Opposition to the State of Wyoming s Motion to Complete and Supplement the Administrative Record at 6 (citing Ariz. Pub. Serv., 562 F.3d at 1122). Whether EPA will argue likewise in its merits briefing remains to be seen, but the Agency will err if it does. Ample decisional authority establishes de novo review as the standard here. In Colorado Public Utilities Commission v. Harmon, 951 F.2d 1571 (10th Cir. 1991), this Court reversed the district court s judgment that had sustained a state agency s regulations in the face of a United States Department of Transportation inconsistency ruling ( DOT ). DOT concluded that the regulations were preempted by a provision of the Hazardous Materials Transportation Uniform Safety Act, 18 U.S.C. 1811(a). The Court held that the advisory opinion was entitled to deference insofar as it addressed interpretation of a statute committed to DOT s administration and with reference to topics within the agency area of expertise such as, there, determining the scope and coverage of its regulations and whether Colorado s regulations cover the same subject matter. Id. at This Court then contrasted a preemption determination because it involves matters of law an area more within the expertise of the courts than within the expertise of the Secretary of Transportation. Id. It thus defer[red] to DOT's determinations that its regulations overlap with Colorado's regulations, but... 7

14 Appellate Case: Document: Date Filed: 01/05/2015 Page: 14 independently review[ed] the legal issue of preemption. Id. Harmon does not stand alone in differentiating between matters properly the province of judicial de novo resolution and those to which agency deference is owed. The Ninth Circuit Court of Appeals reached the same conclusion in Morris v. Commodity Futures Trading Commission, 980 F.2d 1289 (9th Cir. 1992), where it held that the more probing de novo standard is appropriate in those situations where courts have experience in the area and are fully competent to decide the issue. Id. at 1293; see also Nat'l Min. Ass'n v. Sec'y, 153 F.3d 1264, 1267 (11th Cir. 1998) ( [b]ecause deciding if [the Mining Safety and Health Administration] must address the requirements of [30 U.S.C.] 1811(a)(6) is a question of pure statutory construction, we need not defer to MSHA's interpretation ). This reserve of de novo review plainly encompasses questions demanding the interpretation and application of federal common law. See, e.g., Liberty Mut. Ins. Co. v. Commercial Union Ins. Co., 978 F.2d 750, 757 (1st Cir. 1992) ( [i]t is nonsense to suggest that a federal court must defer to an administrative agency in determining the meaning and applicability of the court's own precedent ). These principles have been applied to EPA in a TAS context. In Montana v. USEPA, 137 F.3d 1135 (9th Cir. 1998), the court upheld the Agency s TAS determination under Section 518(e) of the Clean Water Act ( CWA ), 33 U.S.C. 8

15 Appellate Case: Document: Date Filed: 01/05/2015 Page: EPA construed the provision, unlike its counterpart in the CAA, to not contain a delegation of regulatory authority but to require an independent showing of inherent tribal authority applying federal common law standards. See Amendments to the Water Quality Standards Regulation That Pertain to Standards on Indian Reservations, 56 Fed. Reg. 64,876, 64, (Dec. 12, 1991). The state governmental entities agreed that the CWA TAS provision obligated a tribe to make that showing but disagreed with EPA over application of those standards. 137 F.3d at They also disputed the Agency s contention that deference was owed to its decisionmaking. See Brief for Federal Appellees (1996 WL ) at 13-18, 47-48, Montana v. USEPA, 137 F.3d 1135 (9th Cir. 1998) (No ). The Ninth Circuit declined to defer to EPA s interpretation and application of relevant federal common law principles: EPA s decision to adopt inherent tribal authority as the standard intended by Congress may well be viewed in a deferential light because the statute s language and legislative history were not entirely clear.... EPA s delineation of the scope of that standard, however, has nothing to do with its own expertise or with any need to fill interstitial gaps in the statute committed to its regulation. Therefore, EPA s delineation of the scope of tribal inherent authority is not entitled to deference. 137 F.3d at 1140 (citation omitted). The First Circuit Court of Appeals reached an analogous conclusion in Maine v. Johnson, 498 F.3d 37 (1st Cir. 2007), where the question involved the permissible scope of state regulatory authority under the 9

16 Appellate Case: Document: Date Filed: 01/05/2015 Page: 16 Maine Indian Claims Settlement Act of 1980, 25 U.S.C to 1735, and the Maine Implementing Act, 30 M.R.S.A to The latter statute provides in part that tribes are subject to state law except as to internal tribal matters. Id. 6206(1). In holding that EPA had erred in excluding from Maine s CWA water quality program certain tribal facilities because their discharges have insignificant consequences for non-members, the First Circuit reasoned: If the EPA were construing the Clean Water Act, we would under Chevron... owe deference to its coverage determination; but the Settlement Acts, which we treat as a matter of federal law, are not within its purview. So we accept the EPA s factual premise as to the impact of the discharges but not the EPA s legal characterization.... [ ] In our view, the Settlement Acts make ordinary Maine law apply, even if only tribal members and tribal lands are affected in the particular case, unless the internal affairs exemption applies; and the scope of that exemption is determined by the character of the subject matter. Discharging pollutants into navigable waters is not of the same character as tribal elections, tribal membership or other exemplars that relate to the structure of Indian government or the distribution of tribal property. 498 F.3d at (footnote omitted); see also id. at 41 ( [o]ur review is de novo as to issues of law,... except that the EPA gets a measure of deference in applying ambiguous terms in any statute it administers, including the Clean Water Act ) (citations omitted). No doubt exists here that EPA resolved the diminishment issue related to the 1905 Act by reference to settled federal common law principles. The Agency s first attachment to its Decision Document the Legal Analysis of the Wind River Indian Reservation Boundary ( EPA Legal Analysis ) thus used the Supreme 10

17 Appellate Case: Document: Date Filed: 01/05/2015 Page: 17 Court s fairly clean analytical structure for distinguishing those surplus land acts that diminished reservations from those acts that simply offered non-indians the opportunity to purchase land within established boundaries. EPA-WR (quoting Solem v. Bartlett, 465 U.S. 463, 470 (1984)). It further identified those legal canons of construction for analyzing whether a particular Congressional Act had the effect of diminishing reservation boundaries. Id. It then applied the three prongs of diminishment doctrine s analytical structure : the particular surplus land act s language; the circumstances attendant to the act s adoption; and postpassage events. EPA-WR EPA-WR The EPA Legal Analysis concluded with a discussion of decisional authority directly relevant to the Wind River Indian Reservation diminishment issue. EPA-WR EPA-WR Nothing in the lengthy discussion implicated the Agency s expertise with respect to administering the CAA or construing its provisions. It instead reflected EPA s take on federal common law as applied to historical fact. 4 4 That EPA consulted with, and received a written opinion from, the Department of the Interior ( DOI ) with respect to the diminishment issue has no effect on the standard of review as to the Agency s determination of that issue. EPA-WR The Final Decision before this Court, to the extent that it deemed the 1905 Act lands part of the Wind River Indian Reservation, relied on EPA s independent assessment of federal common law and historical fact. EPA neither did nor could transfer its statutory responsibility to make the reservation determination to DOI or merely rubberstamp that agency s views. Even if the Agency had done so, the DOI opinion would not negate applicability of the de novo standard; i.e., whether, as to the merits, it might carry weight under Skidmore 11

18 Appellate Case: Document: Date Filed: 01/05/2015 Page: 18 The EPA Legal Analysis may have reached the right conclusion, or it may have gone astray either by failing to consider or assess properly relevant facts or by misapprehending the nuances of the controlling analytical structure. But its arguments and the EPA Legal Analysis at bottom is simply that should have no more weight than Wyoming s or the other parties submissions. It is for this Court to make an independent determination of the diminishment issue. That is essence of de novo review. CONCLUSION This Court should review de novo EPA s determination of reservation status with respect to the application of the Eastern Shoshone Tribe and the Northern Arapaho Tribe for treatment in the same manner as a State. DATED this 5th day of January LAWRENCE WASDEN ATTORNEY GENERAL STEVEN L. OLSEN Chief of Civil Litigation By /s/ Clay R. Smith CLAY R. SMITH Deputy Attorney General Counsel for Amici Curiae States principles is immaterial to what standard of review controls. See Skidmore v. Swift & Co., 323 U.S. 134, 140 (1944). 12

19 Appellate Case: Document: Date Filed: 01/05/2015 Page: 19 CERTIFICATE OF COMPLIANCE I hereby certify pursuant to Fed. R. App. P. 32(a)(7)(C)(ii) that: The foregoing brief is XX Proportionately spaced, has a typeface of 14 points or more and contains 3063 words or is Monospaced, has 10.5 or fewer characters per inch and contains words or lines of text or is In conformance with the type specifications set forth at Fed. R. App. P. 32(a)(5) and does not exceed pages By /s/ Clay R. Smith Clay R. Smith Deputy Attorney General Attorney for Amici Curiae States 13

20 Appellate Case: Document: Date Filed: 01/05/2015 Page: 20 CERTIFICATE OF SERVICE I hereby certify that on January 5, 2015I electronically filed the foregoing with the Clerk of the Court for the United States Court of Appeals for the Tenth Circuit by using the appellate CM/ECF system. I certify that all participants in the case are registered CM/ECF users and that service will be accomplished by the appellate CM/ECF system. By /s/ Clay R. Smith Clay R. Smith Deputy Attorney General Attorney for Amici Curiae States 14

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