Contour Spa at the Hard Rock, Inc. v. Seminole Tribe of Florida , 692 F.3d 1200 ( 2012 )

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[PUBLISH]
IN THE UNITED STATES COURT OF APPEALS
FOR THE ELEVENTH CIRCUIT
________________________
No. 11-11997
________________________
D.C. Docket No. 0:10-cv-60483-WJZ
CONTOUR SPA AT THE HARD ROCK, INC.,
a Florida corporation,
Plaintiff - Appellant,
versus
SEMINOLE TRIBE OF FLORIDA,
a federally recognized Indian tribe,
MITCHELL CYPRESS, et al.,
Defendants - Appellees.
________________________
Appeal from the United States District Court
for the Southern District of Florida
________________________
(August 30, 2012)
Before MARCUS and BLACK, Circuit Judges, and EVANS,* District Judge.
MARCUS, Circuit Judge:
*
Honorable Orinda Evans, United States District Judge for the Northern District of
Georgia, sitting by designation.
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This case arises out of a leasing agreement between Contour Spa
(“Contour”) and the Seminole Tribe of Florida (“the Tribe”) that turned sour.
Contour appeals from a district court order dismissing its Amended Complaint for
lack of subject matter jurisdiction on account of the Tribe’s sovereign immunity.
Contour offers three reasons to avoid immunity: first, and most basic, Contour
claims that the Tribe’s removal of this case to federal court constitutes a voluntary
waiver of the Tribe’s immunity, relying on the Supreme Court’s Eleventh
Amendment case of Lapides v. Bd. of Regents of the Univ. Sys. of Ga., 535 U.S.
613 (2002); Contour also says that Congress has authorized its suit by creating an
implied cause of action under the Indian Civil Rights Act; and finally, Contour
argues that principles of equitable estoppel prevent the Tribe from asserting
immunity.
The district court rejected all three arguments, and we now affirm. Because
the problems of inconsistency and unfairness that were inherent in the procedural
posture of Lapides are absent here, and because an Indian tribe’s sovereign
immunity is of a far different character than a state’s Eleventh Amendment
immunity, we decline to extend Lapides. As for Contour’s Indian Civil Rights Act
claim, it must fail because the Supreme Court has already held that Indian tribes
are immune from suit under the statute. Finally, the equitable estoppel claim is
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unavailable because it is grounded on a waiver provision contained within a lease
agreement that is wholly invalid as a matter of federal law.
I.
Because we are reviewing the district court’s order granting the tribal
defendants’ motions to dismiss, we take as true the facts as alleged in Contour’s
complaint and attached exhibits. See Grossman v. Nationsbank, N.A., 225 F.3d
1228, 1231 (11th Cir. 2000) (per curiam). The Seminole Tribe of Florida is a
federally recognized Indian tribe that owns and operates the Seminole Hard Rock
Hotel and Casino in Hollywood, Florida. Contour operated a spa facility located
in the Hard Rock from May 2004 through March 2010 pursuant to a long-term
lease that provided for an initial period of ten years followed by four renewal
terms of five years each.
In the lease the Tribe expressly waived its sovereign immunity concerning
any lawsuits Contour might bring based on the Tribe’s default or breach of the
lease agreement.1 Most pertinently, however, the entire lease’s validity was
1
Specifically, the lease provides that if a number of procedural requirements are met, the
Tribe “consents to the jurisdiction of, to be sued in and to accept and be bound by any order or
judgment of the United States District Court for the Southern District of Florida, the Circuit
Court for the 17th Judicial Circuit in and for Broward County, Florida, and any federal or state
court having appellate jurisdiction thereover” where Contour “alleges a default . . . or a breach by
the Tribe of one or more of the specific warranties, representations, obligations or duties
expressly assumed by the Tribe under the terms of this Lease.”
3
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explicitly conditioned upon approval by the Secretary of the Interior: “The
[agreement] is all conditioned upon approval of this Lease by the Secretary of the
Interior, or her authorized representative (‘the Secretary’).” The lease also
incorporated by reference the regulations prescribed by the Secretary pursuant to
25 C.F.R. Part 162.
It is undisputed that these regulations, as well as 25 U.S.C. § 81, apply to
the putative lease, even if they had not been expressly incorporated into the lease’s
terms. Both the regulations and the statute explicitly condition the validity of the
lease on the approval of the Secretary of the Interior. 25 U.S.C. § 81(b) (“No
agreement or contract with an Indian tribe that encumbers Indian lands for a
period of 7 or more years shall be valid unless that agreement or contract bears the
approval of the Secretary of the Interior or a designee of the Secretary.”); 25
C.F.R. § 162.604(a) (“All leases made pursuant to the regulations in this part shall
be in the form approved by the Secretary and subject to his written approval.”).2
Although the chairman of the Seminole Tribal Council, Mitchell Cypress,
submitted the lease to the Secretary of the Interior for approval, it was never
2
The statutory authority for these regulations comes in part from 25 U.S.C. § 415, which
provides that “[a]ny restricted Indian lands, whether tribally, or individually owned, may be
leased by the Indian owners, with the approval of the Secretary of the Interior, for public,
religious, educational, recreational, residential, or business purposes.” 25 U.S.C. § 415(a)
(emphasis added).
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approved. Contour alleges, however, that the Tribe knowingly made false oral and
written assertions that the lease was valid. The complaint highlights a letter dated
November 26, 2003, from the Seminole Tribe’s authorized representative referring
to the lease as having been “fully executed.” Contour also included in the
complaint a reference to a conversation its owner had with the tribal representative
whereby Contour was assured “that all paperwork needed for the Lease had been
submitted and approved,” and that the spa had to be open for business by May 17,
2004. The tribal representative also allegedly said: “Girl, you are good to go.
Mazal tov. Congratulations.” Contour then spent more than $1.5 million to
design and build the spa, which opened at the Tribe’s hotel on May 17, 2004.
The deal between the parties began to sour in 2005 when Contour wanted to
begin charging Hard Rock Hotel guests to use the fitness center at the spa. But
what really set the stage for this lawsuit was a comment made by a tribal
representative in June 2007 that the “Lease Agreement was no good, and could be
terminated at any time, since approval . . . had never been obtained from the
Bureau of Indian Affairs.” Contour wrote to the Bureau of Indian Affairs (“BIA”),
an agency housed within the Department of the Interior, and discovered that
although the Seminole Tribe had submitted the lease, it had never been approved.
Instead, Contour learned, the BIA had sent a reply letter to the Seminole Tribe
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dated May 27, 2004 (ten days after the spa opened), noting a series of deficiencies
in the lease and requesting that the Seminole Tribe correct them and resubmit the
lease application for the Secretary’s approval. Allegedly, the Tribe never shared
any of this with Contour. Once it learned of the BIA’s letter, however, Contour
promptly advised the Tribe that Contour agreed to the changes requested by the
BIA, but the Tribe still failed to respond or to resubmit the lease for approval.
Notwithstanding having learned that the lease had never been approved,
Contour continued to operate its spa at the hotel. But Contour’s operations at the
Hard Rock ended on March 17, 2010, when the Tribe’s counsel e-mailed a letter to
Contour informing Contour that the Tribe had decided to retake the premises and
to permanently close the spa. By the next day, the Seminole Tribe had padlocked
the doors on Contour’s business and would only allow Contour access when
escorted by tribal security and for the limited purpose of removing personal
property.
Contour wasted no time in going to court. On March 19, 2010, Contour
filed suit against the Seminole Tribe in Florida Circuit Court for Broward County,
seeking emergency declaratory and injunctive relief. Shortly thereafter, the Tribe
removed the case to the United States District Court for the Southern District of
Florida.
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Contour then took the opportunity to amend its complaint. In addition to
the Tribe itself, Contour added as defendants the Tribe’s Chairman, Mitchell
Cypress, unnamed tribal member(s) John Doe, and unnamed non-tribal
defendant(s) Richard Roe. The Amended Complaint alleged two federal claims
and five state-law counts. Counts I and II sought declaratory and injunctive relief
against all tribal defendants under the Indian Civil Rights Act, 25 U.S.C. §§ 1301-
02, and the Indian Long Term Leasing Act and its accompanying regulations, 25
U.S.C. § 415 and 25 C.F.R. pt. 2, 162. The remaining counts all sought damages
under state-law causes of action for wrongful eviction, unlawful entry and
detention, fraud, promissory estoppel, and unjust enrichment. The federal charges
were limited to the tribal defendants.
Both the Seminole Tribe and, separately, Chairman Cypress, moved to
dismiss for lack of subject matter jurisdiction, asserting tribal sovereign immunity.
After full briefing, the district court dismissed the federal claims, and remanded
the state-law claims back to state court, finding no basis for retaining supplemental
jurisdiction under 28 U.S.C. § 1367. This timely appeal followed.
II.
“We review de novo the district court’s dismissal of a complaint for
sovereign immunity.” Sanderlin v. Seminole Tribe of Fla., 243 F.3d 1282, 1285
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(11th Cir. 2001); accord Florida v. Seminole Tribe of Fla., 181 F.3d 1237, 1240-
41 (11th Cir. 1999); Fla. Paraplegic, Ass’n v. Miccosukee Tribe of Indians of Fla,
166 F.3d 1126, 1128 (11th Cir. 1999).
Although the Supreme Court has expressed some doubt about the continued
wisdom of the tribal immunity doctrine, it is nonetheless clear that “[a]s a matter
of federal law, an Indian tribe is subject to suit only where Congress has
authorized the suit or the tribe has waived its immunity.” Kiowa Tribe of Okla. v.
Mfg. Techs., Inc., 523 U.S. 751, 754 (1998); accord Okla. Tax Comm’n v. Citizen
Band Potawatomi Indian Tribe of Okla., 498 U.S. 505, 509 (1991) (“Indian tribes
are domestic dependent nations that exercise inherent sovereign authority over
their members and territories. Suits against Indian tribes are thus barred by
sovereign immunity absent a clear waiver by the tribe or congressional
abrogation.” (internal quotation marks and citation omitted)); Furry v. Miccosukee
Tribe of Indians of Fla., 2012 WL 2478232, *2 (11th Cir. June 29, 2012);
Sanderlin, 243 F.3d at 1285; Seminole Tribe, 181 F.3d at 1241; Fla. Paraplegic,
166 F.3d at 1130-31.
Contour offers three reasons for why tribal immunity should not bar this
lawsuit: first, Contour claims that removal of the case to federal court amounted to
a waiver of the Tribe’s sovereign immunity; Contour also says that the Indian
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Civil Rights Act creates an implied cause of action against the Tribe; and finally,
Contour contends that equitable principles should hold the Tribe to its express
waiver of sovereign immunity, even though the lease containing that waiver is
plainly invalid as a matter of law since the Secretary of the Interior never approved
it. We address each argument in turn.
A.
The first and most substantial argument is that the Supreme Court’s
Eleventh Amendment holding in Lapides should be extended in order to establish
that when an Indian tribe voluntarily removes a case to federal court it too waives
sovereign immunity from suit. We are unpersuaded.
In Lapides, an employee of the Georgia state university system sued the
University Board of Regents and individual board members in Georgia state court,
alleging violations of both Georgia tort law and federal law. Lapides, 535 U.S. at
616. By statute, Georgia had expressly waived its immunity from suit for claims
sounding in tort and brought in state court, but did not waive immunity from
actions brought in federal court. Ga. Code Ann. § 50-21-23(b) (“The state waives
its sovereign immunity only to the extent and in the manner provided in this article
and only with respect to actions brought in the courts of the State of Georgia. The
state does not waive any immunity with respect to actions brought in the courts of
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the United States.”).
Not surprisingly, Georgia then removed the cause to federal court based on
the federal claim, which had been brought under 42 U.S.C. § 1983. Lapides, 535
U.S. at 616. By the time the case reached the Supreme Court, the section 1983
claim had dropped out of the suit because the individual defendants had been
dismissed from the case on qualified immunity grounds and the state of Georgia
could not be sued for money damages under section 1983. Id. at 616-17. Thus,
Justice Breyer’s opinion writing for a unanimous Supreme Court began the
analysis by emphasizing the narrow question it was answering:
Lapides sought certiorari. We agreed to decide whether “a state
waive[s] its Eleventh Amendment immunity by its affirmative litigation
conduct when it removes a case to federal court . . . .”
It has become clear that we must limit our answer to the context of
state-law claims, in respect to which the State has explicitly waived
immunity from state-court proceedings. That is because Lapides’ only
federal claim against the State arises under 42 U.S.C. § 1983, that claim
seeks only monetary damages, and we have held that a State is not a
“person” against whom a § 1983 claim for money damages might be
asserted. Hence this case does not present a valid federal claim against
the State. Nor need we address the scope of waiver by removal in a
situation where the State’s underlying sovereign immunity from suit has
not been waived or abrogated in state court.
Id. at 617-18 (alterations in original) (emphases added) (citations omitted); accord
id. at 618 (“[T]he question presented is not moot. We possess the legal power here
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to answer that question as limited to the state-law context just described.”).
The Supreme Court ultimately determined that the state of Georgia did
indeed waive its Eleventh Amendment immunity by removing the case to federal
court. See id. at 619-24. Notwithstanding the express limitation on its holding,
the Court’s subsequent reasoning was in many ways quite broad. The Court began
by observing that “[i]t would seem anomalous or inconsistent for a State both (1)
to invoke federal jurisdiction, thereby contending that the Judicial power of the
United States extends to the case at hand, and (2) to claim Eleventh Amendment
immunity, thereby denying that the Judicial power of the United States extends to
the case at hand.” Id. at 619 (internal quotation marks omitted). The Court further
noted that “a Constitution that permitted States to follow their litigation interests
by freely asserting both claims in the same case could generate seriously unfair
results.” Id.; accord id. at 622 (“In large part the rule governing voluntary
invocations of federal jurisdiction has rested upon the problems of inconsistency
and unfairness that a contrary rule of law would create.”). The Court also pointed
out that Georgia had “voluntarily agreed to remove the case to federal court,” that
“[i]n doing so, it voluntarily invoked the federal court’s jurisdiction,” and
therefore, “unless there is something special about removal or about this case, the
general legal principle requiring waiver ought to apply.” Id. at 620.
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The Supreme Court rejected Georgia’s claim that waiver should not apply
because “its motive for removal was benign,” reasoning that “[m]otives are
difficult to evaluate, while jurisdictional rules should be clear” and that “[t]o adopt
the State’s Eleventh Amendment position would permit States to achieve unfair
tactical advantages, if not in this case, in others.” Id. at 621. The Court concluded
this way: “[W]e believe the rule is a clear one, easily applied by both federal
courts and the States themselves. It says that removal is a form of voluntary
invocation of a federal court’s jurisdiction sufficient to waive the State’s otherwise
valid objection to litigation of a matter (here of state law) in a federal forum.” Id.
at 623-24.
A few of our sister circuits have turned Lapides into a “straightforward,
easy-to-administer rule” that removal by a state waives its Eleventh Amendment
immunity, regardless of whether the state has previously waived its immunity in
state court or whether the removed claims arose under state or federal law.
Embury v. King, 361 F.3d 562, 566 (9th Cir. 2004); accord Estes v. Wyo. Dep’t of
Transp., 302 F.3d 1200, 1206 (10th Cir. 2002); cf. Bd. of Regents of the Univ. of
Wis. Sys. v. Phoenix Int’l Software, Inc., 653 F.3d 448, 461-62 (7th Cir. 2011)
(noting that Lapides is not limited to its facts and holding that plaintiff state, by
bringing suit in federal court, waived its immunity from related counterclaims).
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Other circuits have declined to read Lapides quite so broadly, taking the Supreme
Court at its word and limiting Lapides to its procedural posture -- instances in
which a state removes claims for which it had waived its immunity in state court.
See Bergemann v. R.I. Dep’t of Envtl. Mgmt., 665 F.3d 336, 341-42 (1st Cir.
2011); Stewart v. North Carolina, 393 F.3d 484, 490 (4th Cir. 2005); see also
Watters v. Wash. Metro. Area Transit Auth., 295 F.3d 36, 42 n.13 (D.C. Cir. 2002)
(reaching same conclusion in dicta). Still other circuits have posited a middle
ground, holding that a state’s act of removing a case to federal court would waive
its Eleventh Amendment immunity from suit but not its separate defense of
immunity from liability as a matter of state law. See Lombardo v. Pa., Dep’t of
Pub. Welfare, 540 F.3d 190, 198-200 (3d Cir. 2008); Meyers ex rel. Benzing v.
Texas, 410 F.3d 236, 250, 252-55 (5th Cir. 2005).
We need not enter into this conflict today over how best to read Lapides
with respect to a state’s removal of a case to federal court. Simply put, an Indian
tribe’s sovereign immunity is not the same thing as a state’s Eleventh Amendment
immunity, and Lapides in no way addressed tribal sovereign immunity. See Three
Affiliated Tribes of the Fort Berthold Reservation v. Wold Eng’g, 476 U.S. 877,
890-91 (1986) (“[B]ecause of the peculiar ‘quasi-sovereign’ status of the Indian
tribes, the Tribe’s immunity is not congruent with that which the Federal
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Government, or the States, enjoy.” (citing United States v. U.S. Fid. & Guar. Co.,
309 U.S. 506, 513 (1940))). Indeed, as the Supreme Court observed in Kiowa
Tribe, “the immunity possessed by Indian tribes is not coextensive with that of the
States,” and “tribal immunity is a matter of federal law and is not subject to
diminution by the States.” 523 U.S. at 756. Moreover, and equally important in
this calculus, we may not lightly conclude that an Indian tribe has waived its
immunity from suit. Our precedents make it abundantly clear that a waiver of
tribal sovereign immunity cannot be implied on the basis of a tribe’s actions;
rather, it must be unequivocally expressed. See Sanderlin, 243 F.3d at 1286;
Seminole Tribe, 181 F.3d at 1243. And although the precise issue before us --
whether an Indian tribe’s removal of a suit to federal court waives the tribe’s
sovereign immunity -- is one of first impression among the circuits, there are
powerful reasons to treat an Indian tribe’s sovereign immunity differently from a
state’s Eleventh Amendment immunity.
For starters, tribal immunity is in many respects more analogous to foreign
sovereign immunity than to state Eleventh Amendment immunity. The
significance of the comparison inheres in the fact that foreign sovereigns do not
waive their sovereign immunity by removing a case to federal court. See 28
U.S.C. § 1441(d) (“Any civil action brought in a State court against a foreign state
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. . . may be removed by the foreign state to the district court of the United States
for the district and division embracing the place where such action is pending.”);
Russell Corp. v. Am. Home Assurance Co., 264 F.3d 1040, 1047 n.4 (11th Cir.
2001) (explaining that 28 U.S.C. § 1441(d) “provides an absolute right of removal
to the federal courts by a foreign state to resolve sovereign immunity issues”
(citing In re Delta Am. Re Ins. Co., 900 F.2d 890, 893 (6th Cir. 1990))); see also
Rodriguez v. Transnave Inc., 8 F.3d 284, 289 (5th Cir. 1993) (“[R]emoval by a
foreign sovereign is explicitly authorized by 28 U.S.C. 1441(d) and clearly cannot
constitute waiver.”).
While Indian tribes do not have an express statutory right of removal, the
similarities between foreign sovereign immunity and tribal immunity are
nonetheless considerable. Indeed, the Supreme Court has offered just such a
comparison in describing the origins of the two doctrines, as well as the federal
government’s role in shaping their contours:
In considering Congress’ role in reforming tribal immunity, we find
instructive the problems of sovereign immunity for foreign countries.
As with tribal immunity, foreign sovereign immunity began as a judicial
doctrine. Chief Justice Marshall held that United States courts had no
jurisdiction over an armed ship of a foreign state, even while in an
American port. While the holding was narrow, “that opinion came to be
regarded as extending virtually absolute immunity to foreign
sovereigns.” In 1952, the State Department issued what came to be
known as the Tate Letter, announcing the policy of denying immunity
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for the commercial acts of a foreign nation. Difficulties in implementing
the principle led Congress in 1976 to enact the Foreign Sovereign
Immunities Act, resulting in more predictable and precise rules.
Like foreign sovereign immunity, tribal immunity is a matter of federal
law. Although the Court has taken the lead in drawing the bounds of
tribal immunity, Congress, subject to constitutional limitations, can alter
its limits through explicit legislation.
Kiowa Tribe, 523 U.S. at 759 (citations omitted).
Again, tribal immunity is a matter of purely federal law. Id.; see also South
Dakota v. Yankton Sioux Tribe, 522 U.S. 329, 343 (1998) (“Congress possesses
plenary power over Indian affairs, including the power to modify or eliminate
tribal rights.”). Much like foreign sovereigns, Indian tribes have an interest in a
uniform body of federal law in this area. Cf. Lowery v. Ala. Power Co., 483 F.3d
1184, 1197 (11th Cir. 2007) (noting that 28 U.S.C. § 1441(d) “was intended to
give foreign states the discretion to use a federal forum to litigate civil actions into
which they have been brought for the purpose of encouraging uniformity in that
area of law” (internal quotation marks omitted)). These interests in adjudicating
tribal immunity claims in a federal forum are considerable, and, thus, we are hard
pressed to justify mechanically extending the decision in Lapides to this wholly
different context -- whether an Indian tribe has waived its immunity from suit.3 In
3
Contour suggests that, at least in the commercial context, Indian tribes should not be
able to lay claim to the policy rationale underlying foreign sovereigns’ ability to preserve their
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fact, to do so would effectively mean that an Indian tribe that has been sued in
state court for violations of federal law must either forego its immunity from suit
by removing the case or assert its immunity -- itself a matter of federal law -- only
in state court.
We can discern no sound basis in law or logic for forcing an Indian tribe to
make this choice. The Court’s holding in Lapides was based in no small measure
on the obvious “problems of inconsistency and unfairness” that the procedural
posture of the case presented. 535 U.S. at 622. If the Supreme Court had declined
to find a waiver in Lapides, then Georgia’s removal of the case to federal court
would have effectively operated as an end-run around its waiver of immunity in
state court. Indeed, it is hard to ignore entirely the Supreme Court’s express
limitation of its holding “to the context of state-law claims, in respect to which the
State has explicitly waived immunity from state-court proceedings.” Id. at 617. In
immunity after removal. But accepting this argument would require drawing a distinction in the
tribal immunity doctrine between tribal governance activities (which, under Contour’s approach,
presumably implicate greater federal policy concerns) and tribal commercial activities -- a
distinction the Supreme Court has already rejected in Kiowa Tribe. 523 U.S. at 755 (“Though
respondent asks us to confine immunity from suit to transactions on reservations and to
governmental activities, our precedents have not drawn these distinctions.”). Indeed, the
commercial context is one area in which an Indian tribe currently enjoys even greater immunity
from suit than does a foreign sovereign. Cf. Verlinden B.V. v. Cent. Bank of Nigeria, 461 U.S.
480, 488 (1983) (describing the Foreign Sovereign Immunities Act’s exception to a foreign
sovereign’s immunity from suit for “actions based upon commercial activities of the foreign
sovereign carried on in the United States or causing a direct effect in the United States” (citing 28
U.S.C. § 1605(a)(2))).
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sharp contrast, here the Seminole Tribe has in no way consented to be sued on any
of the claims in this case in any forum, whether federal or state. Plainly, the
Tribe’s act of removal was not an attempt to obtain “unfair tactical advantage[].”
Id. at 621. This further cautions against extending Lapides to our case.
We also find it difficult to reconcile Contour’s claim that we should broadly
read Lapides and extend its holding to tribal sovereign immunity with the Supreme
Court’s decision in Potawatomi, which held that filing a suit for injunctive relief
against a state tax commission in federal court did not waive an Indian tribe’s
immunity from the tax commission’s counterclaims. 498 U.S. at 509-10 (“We
uphold the Court of Appeals’ determination that the Tribe did not waive its
sovereign immunity merely by filing an action for injunctive relief.”). It is clear
that the Indian tribe had voluntarily invoked the jurisdiction of the federal courts,
yet did not waive its sovereign immunity against related counterclaims by doing
so. Notably, the Supreme Court in Lapides expressly distinguished Potawatomi
and other cases cited by the state of Georgia, recognizing that tribal immunity
implicates wholly different concerns than are raised by Eleventh Amendment
immunity:
Those cases, however, do not involve the Eleventh Amendment -- a
specific text with a history that focuses upon the State’s sovereignty
vis-á-vis the Federal Government. And each case involves special
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circumstances not at issue here, for example, an effort by a sovereign
(i.e., the United States) to seek the protection of its own courts (i.e., the
federal courts), or an effort to protect an Indian tribe.
Lapides, 535 U.S. at 623 (emphasis added). The Supreme Court squarely
recognized that waiver rules applicable to states may not apply in the same way to
Indian tribes.
We are, therefore, reluctant to extend the Supreme Court’s decision in
Lapides, which, after all, raised questions about a state’s removal of a claim in the
context of Eleventh Amendment immunity, to the substantially different context
presented by this case. In short, the Tribe’s removal of the case to federal court
did not, standing alone, waive the Tribe’s sovereign immunity from suit.
B.
Contour also claims that the Indian Civil Rights Act of 1968 (“ICRA”), 25
U.S.C. §§ 1301-1303, creates an implicit cause of action that allows Contour to
sue the Seminole Tribe. In particular, Contour says that it should be permitted to
sue the Tribe for violations of 25 U.S.C § 1302(a)(5) and (a)(8), which provide:
“No Indian tribe in exercising powers of self-government shall . . . take any private
property for a public use without just compensation . . . [or] deny to any person
within its jurisdiction the equal protection of its laws or deprive any person of
liberty or property without due process of law.” The trouble with this argument is
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that it is foreclosed by Supreme Court precedent establishing that the Tribe is
immune from just such a suit. See Santa Clara Pueblo v. Martinez, 436 U.S. 49(1978). Santa Clara Pueblo involved an internal tribal dispute, in which a tribal
member and her daughter sued the tribe and its Governor under the ICRA “seeking
declaratory and injunctive relief against enforcement of a tribal ordinance denying
membership in the tribe to children of female members who marry outside the
tribe, while extending membership to children of male members who marry
outside the tribe.” Id. at 51. The entirety of the pertinent tribal immunity holding
from Santa Clara Pueblo is as follows:
It is settled that a [congressional] waiver of sovereign immunity
“‘cannot be implied but must be unequivocally expressed.’” Nothing on
the face of Title I of the ICRA purports to subject tribes to the
jurisdiction of the federal courts in civil actions for injunctive or
declaratory relief. Moreover, since the respondent in a habeas corpus
action is the individual custodian of the prisoner, the provisions of [25
U.S.C.] § 1303 [expressly providing for federal habeas corpus
jurisdiction to contest the legality of a tribal detention] can hardly be
read as a general waiver of the tribe’s sovereign immunity. In the
absence here of any unequivocal expression of contrary legislative
intent, we conclude that suits against the tribe under the ICRA are
barred by its sovereign immunity from suit.
Id. at 58-59 (emphasis added) (citations omitted). Contour’s argument does not
even address the Supreme Court’s straightforward tribal immunity holding.
Contour instead relies upon an opinion from the Tenth Circuit holding that
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the Indian Civil Rights Act creates an implied cause of action, at least where the
following narrow circumstances are met: (1) the involvement of a non-Indian in
the suit; (2) an attempt by the plaintiff to seek a remedy in a tribal forum; and (3)
the unavailability of an adequate tribal remedy. Dry Creek Lodge, Inc. v.
Arapahoe & Shoshone Tribes, 623 F.2d 682, 685 (10th Cir. 1980). Although the
district court in this case examined whether Contour met the factors enumerated
by the Tenth Circuit in Dry Creek before declining to find an implied cause of
action, it need not have gone that far. As we see it, the Tenth Circuit’s framework
is unnecessary when tribal immunity is at issue. The law is crystal clear that tribal
immunity applies unless there has been congressional abrogation or waiver by the
tribe. Kiowa Tribe, 523 U.S. at 754. The problem with Contour’s claim is that
congressional abrogation must be unequivocally expressed and the Supreme Court
has already held that “suits against the tribe under the ICRA are barred by its
sovereign immunity from suit.” Santa Clara Pueblo, 436 U.S. at 59.4 The very
4
As far as tribal immunity and the ICRA are concerned, the entire holding of the
Supreme Court is found in the one-paragraph explanation that congressional abrogation of
sovereign immunity must be unequivocally expressed and that the ICRA does not expressly
abrogate tribes’ immunity from suit. Santa Clara Pueblo, 436 U.S. at 58-59. That was the
beginning and the end of the relevant analysis. The Supreme Court in Santa Clara Pueblo also
had occasion to address whether there was an implied cause of action under the ICRA, but only
because one of the tribal officers was sued individually and was not protected by the tribe’s
immunity from suit under the principles of Ex Parte Young, 209 U.S. 123 (1908). See 436 U.S.
at 59. It was only because of this distinction that the Supreme Court had to “determine whether
the cause of action for declaratory and injunctive relief asserted here by respondents, though not
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notion of an implied cause of action against an Indian tribe protected by sovereign
immunity is at war with the requirement that Congress must expressly abrogate the
tribe’s immunity. The Indian Civil Rights Act provides no basis to subject the
Seminole Tribe to the instant suit.
C.
Contour’s final argument is that the Seminole Tribe’s misrepresentations
about the status of the lease -- that the lease was “fully executed,” that “all
paperwork needed for the Lease had been submitted and approved,” and that
Contour’s owner was “good to go” -- should prevent the Tribe from disclaiming its
express waiver of sovereign immunity contained in the concededly invalid lease
agreement. Contour claims that “equitable estoppel principles should apply to 25
expressly authorized by the [ICRA], is nonetheless implicit in its terms.” Id.; see also id. at 73
n.2 (White, J., dissenting) (“Because the ICRA is silent on the question, I agree with the Court
that the Act does not constitute a [congressional] waiver of the Pueblo’s sovereign immunity.
The relief respondents seek, however, is available against petitioner Lucario Padilla, the
Governor of the Pueblo.”).
Although one of the tribal defendants, Chairman Cypress, is an individual officer of the
Tribe, the district court held that the Ex Parte Young doctrine did not apply to Chairman Cypress
because he was acting in his official capacity and within the scope of his authority during the
course of conduct alleged in Contour’s complaint. See Tamiami Partners, Ltd. v. Miccosukee
Tribe of Indians of Fla., 177 F.3d 1212, 1225 (11th Cir. 1999) (“[T]ribal officers are protected by
tribal sovereign immunity when they act in their official capacity and within the scope of their
authority; however, they are subject to suit under the doctrine of Ex Parte Young when they act
beyond their authority.”). This holding has not been challenged by Contour on appeal. We,
therefore, have no occasion to revisit the issue of whether Chairman Cypress is protected by the
Tribe’s immunity from suit.
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U.S.C. § 81 agreements that require approval of contracts ‘that encumber Indian
lands for a period of 7 or more years’ because if they do not, the principles and
purposes of equitable estoppel are rendered meaningless.” We remain
unpersuaded.
Contour has provided us with no support for its claim that the Seminole
Tribe is somehow estopped from asserting the invalidity of the lease agreement in
its entirety. Indeed, Contour’s own brief concedes that because “the Secretary of
Interior did not approve the long term lease contract . . . . the waiver of sovereign
immunity contained in that lease is not binding.” We are, therefore, unpersuaded
by Contour’s equitable estoppel argument, and join our sister circuits that have
addressed similar arguments in holding that estoppel cannot compel enforcement
of any of a contract’s provisions when the contract is rendered legally invalid by
operation of federal law. See United States ex rel. Citizen Band Potawatomi
Indian Tribe of Okla. v. Enter. Mgmt. Consultants, Inc., 883 F.2d 886, 890 (10th
Cir. 1989); A.K. Mgmt. Co. v. San Manuel Band of Mission Indians, 789 F.2d
785, 789 (9th Cir. 1986).
The Ninth Circuit’s decision in A.K. Management is instructive. That court
considered a contract between a non-tribal party (“AK”) and an Indian tribe (“the
Band”) that “gave AK the exclusive right to construct a bingo facility and operate
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bingo games on the Band’s reservation for twenty years.” 789 F.2d at 786. The
agreement included provisions obliging the Band to act in good faith and to take
all necessary steps to execute the agreement. Id. The agreement also included
provisions expressly waiving the Band’s sovereign immunity as to any action to
enforce or interpret the agreement, and incorporating the statutory and regulatory
requirements that the contract receive approval from the Bureau of Indian Affairs.
Id. Nonetheless, three days after signing the agreement, the tribe notified AK that
it would not recognize the agreement it had just signed. Id. Just as in this case, it
was undisputed that the agreement was never approved by the BIA. Id. Unlike
this case, however, the Band never even attempted to obtain BIA approval. See id.
After first arguing that 25 U.S.C. § 81 did not apply to the agreement at all,
“AK assert[ed] that even if section 81 applies to the Agreement,” the Band was
“nonetheless obligated under general contract principles to seek BIA approval of
the Agreement” under “both an express and implied duty of good faith and fair
dealing.” Id. at 788. AK also argued that the Band could not be allowed to escape
liability under the contract through the Band’s own failure to seek BIA approval.
Id. at 789.
The Ninth Circuit rejected this line of argument because it could not be
squared with the language of the statute:
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Whatever the persuasive force of these arguments, it is doubtful that
general contract principles apply to an agreement subject to 25 U.S.C.
§ 81 (1982). Section 81 explicitly provides that a contract is “null and
void” without written approval from the BIA. Therefore it is logical to
conclude that an agreement without BIA approval must be null and void
in its entirety. No part of it may be enforced or relied upon unless and
until BIA approval is given. BIA approval is an absolute prerequisite to
the enforceability of the contract. To give piecemeal effect to a contract
as urged by AK, would hobble the statute. The plain words of section
81 simply render this contract void in the absence of BIA approval.
Since it is void, it cannot be relied upon to give rise to any obligation by
the Band, including an obligation of good faith and fair dealing.
Accordingly, we find that general contract principles do not impose a
duty on the Band to seek BIA approval of the Agreement.
Id. (footnote omitted).5 The Ninth Circuit’s tribal immunity analysis was then
straightforward. The court observed that “the waiver of sovereign immunity is
clearly part of the Agreement, and is not operable except as part of that
Agreement.” Id. It concluded that “[s]ince the entire contract is inoperable
without BIA approval, the waiver is inoperable and, therefore, the tribe remains
immune from suit.” Id.
The Tenth Circuit in Potawatomi reached the same conclusion, explicitly
following the Ninth Circuit’s approach. The Tenth Circuit rejected the non-tribal
5
The Ninth Circuit was interpreting a previous version of section 81 that used the term
“null and void” to describe contracts lacking Secretarial approval. 25 U.S.C. § 81 (1982). Since
the year 2000, the statute has provided: “No agreement or contract with an Indian tribe that
encumbers Indian lands for a period of 7 or more years shall be valid unless that agreement or
contract bears the approval of the Secretary of the Interior or a designee of the Secretary.” 25
U.S.C. § 81(b) (emphasis added). For purposes of this appeal, however, we are hard pressed to
see a relevant difference between a legally invalid contract and a null and void one.
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party’s assertion that the Indian tribe’s “particularly egregious conduct” supported
the claim “that the Tribe is estopped from asserting the protection of section 81.”
883 F.2d at 890. The court noted that “similar claims of estoppel based on similar
circumstances have been considered in the context of section 81 and rejected.” Id.
(citing A.K. Mgmt., 789 F.2d at 788-89).
The reasoning behind these decisions is persuasive. The straightforward
text of 25 U.S.C. § 81 makes plain that a contract governed by this statute is
invalid until the Secretary has approved it. 25 U.S.C. § 81(b) (“No agreement or
contract with an Indian tribe that encumbers Indian lands for a period of 7 or more
years shall be valid unless that agreement or contract bears the approval of the
Secretary of the Interior or a designee of the Secretary.”). The piecemeal
enforcement of various provisions of an indisputably invalid lease agreement --
such as the Tribe’s waiver of sovereign immunity -- would squarely conflict with
the text of the statute. We add that if it seems as if the approval requirement
embodied in 25 U.S.C. § 81 is entirely one-sided, giving all the benefit to the
Indian tribe and placing all of the risk on the non-tribal party, that is because the
statute was designed that way. “Section 81 was enacted in 1872 ‘to protect the
Indians from improvident and unconscionable contracts.’” Wis. Winnebago Bus.
Comm. v. Koberstein, 762 F.2d 613, 617 (7th Cir. 1985) (quoting In re Sanborn,
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148 U.S. 222, 227 (1893)); see also H.R. Rep. No. 106-501, at 1-2 (2000),
reprinted in 2000 U.S.C.C.A.N. 69, 69 (“Section 81 of Title 25 of the United
States Code, enacted in 1872, is intended to protect Indians from improvident
contracts and is concerned primarily with federal control over contracts between
Indians [sic] tribes or individual Indians and non-Indians.”). While the statute has
been amended over the years to reduce federal control, most recently in 2000 to
limit its scope to long-term contracts that encumber Indian lands for seven or more
years, there is no dispute that it unambiguously applies to the long-term lease at
issue in this case.
The Secretary’s approval is a condition precedent to the validity of any lease
covered by 25 U.S.C. § 81. Contour does not dispute this basic legal reality.
However misleading the alleged conduct of the Seminole Tribe may have been,
there is no legal support for Contour’s claim that equitable principles can
somehow resurrect an Indian tribe’s waiver of sovereign immunity from the
graveyard of a concededly invalid lease agreement. This claim too provides no
basis for subjecting the Seminole Tribe to suit.
Accordingly, we affirm the judgment of the district court dismissing
Contour’s federal claims for lack of jurisdiction and remanding the state-law
claims back to state court.
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AFFIRMED.
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