Amerind Risk Management v. Myrna Malaterre , 633 F.3d 680 ( 2011 )

United States Court of Appeals
FOR THE EIGHTH CIRCUIT
___________
No. 08-3949
___________
Amerind Risk Management *
Corporation, *
*
Appellant, *
* Appeal from the United States
v. * District Court for the District
* of North Dakota.
Myrna Malaterre; Carol Belgarde; *
Lonnie Thompson, *
*
Appellees. *
___________
Submitted: October 22, 2009
Filed: February 15, 2011
___________
Before BYE, BEAM, and SHEPHERD, Circuit Judges.
___________
BEAM, Circuit Judge.
Amerind Risk Management Corporation (Amerind) is a federally chartered
corporation that assumed the rights and obligations of its tribally chartered
predecessor, also named Amerind Risk Management Corporation (ARMC). Amerind
appeals the federal district court's adverse grant of summary judgment in this
declaratory judgment action. Amerind sought a determination in federal district court
that the Turtle Mountain Tribal Court (Tribal Court) lacked jurisdiction over tort
litigation between Amerind and three enrolled members of the Turtle Mountain Band
of Chippewa Indians (Tribe), and requested an order enjoining the plaintiffs from
proceeding in the Tribal Court. The district court held that, although Amerind was a
nonmember of the Tribe, the Tribal Court had jurisdiction over the tort litigation based
on ARMC's contractual relationship with the Turtle Mountain Housing Authority
(TMHA), an entity of the Tribe.
We hold that the Tribal Court does not have jurisdiction over the plaintiffs'
direct suit against Amerind because Amerind is entitled to tribal immunity and the
plaintiffs have failed to meet their burden of showing that Amerind waived such
immunity. Accordingly, we reverse the district court and remand with directions to
enjoin the plaintiffs from proceeding against Amerind in Tribal Court.
I. BACKGROUND
In 1986, at the encouragement of the United States Department of Housing and
Urban Development, ARMC was incorporated under the laws of the Red Lake Band
of Chippewa Indians as a self-insurance risk pool for Indian Housing Authorities and
Indian tribes. TMHA joined the ARMC risk pool and, on December 28, 2001, ARMC
issued TMHA a "Certificate of Coverage" and a "Scope of Coverage" document
outlining TMHA's property damage and personal injury coverage from January 1,
2002, through December 31, 2002.
On October 19, 2002, a fire destroyed a house on the Turtle Mountain Indian
Reservation being leased from TMHA, killing two houseguests and seriously injuring
a third. Three enrolled members of the Tribe–Myrna Malaterre and Carol Belgarde,
mothers of the deceased houseguests; and Lonnie Thompson, the injured houseguest
(plaintiffs)1–brought a wrongful death and personal injury action against TMHA in
the Tribal Court. The complaint was amended on September 5, 2003, to include
ARMC as a defendant. ARMC filed a motion to dismiss, challenging the Tribal
Court's jurisdiction on the basis of tribal sovereign immunity. While the case was
1
Lonnie Thompson was added as a plaintiff after the lawsuit was filed.
-2-
pending in Tribal Court, the Department of the Interior issued a federal corporate
charter incorporating Amerind pursuant to 25 U.S.C. § 477.2 The charter was
effective upon ratification by the Charter Tribes–the Red Lake Band of Chippewa
Indians, the Confederated Salish and Kootenai Tribes of the Flathead Reservation, and
the Pueblo of Santa Ana. By April 15, 2004, all three Charter Tribes passed
resolutions ratifying Amerind's federal charter. Notably, the federal charter gave
Amerind the power "[t]o acquire the rights and assets and assume the obligations and
liabilities of [ARMC]."
On July 1, 2004, the plaintiffs filed a declaratory judgment action in federal
district court seeking a determination that the ARMC self-insurance policy covered
their claims. Amerind filed a motion to dismiss, asserting that the plaintiffs failed to
exhaust their tribal remedies and, alternatively, that Amerind was entitled to tribal
sovereign immunity as a § 477 corporation. The federal district court dismissed the
case without prejudice, holding that pursuant to the tribal exhaustion doctrine, the
Tribal Court should be given the first opportunity to address the factual and legal
issues presented in the case, including the tribal sovereign immunity issue. Malaterre
2
25 U.S.C. § 477 provides:
The Secretary of the Interior may, upon petition by any tribe, issue a
charter of incorporation to such tribe: Provided, That such charter shall
not become operative until ratified by the governing body of such tribe.
Such charter may convey to the incorporated tribe the power to purchase,
take by gift, or bequest, or otherwise, own, hold, manage, operate, and
dispose of property of every description, real and personal, including the
power to purchase restricted Indian lands and to issue in exchange
therefor interests in corporate property, and such further powers as may
be incidental to the conduct of corporate business, not inconsistent with
law, but no authority shall be granted to sell, mortgage, or lease for a
period exceeding twenty-five years any trust or restricted lands included
in the limits of the reservation. Any charter so issued shall not be
revoked or surrendered except by Act of Congress.
-3-
v. Amerind Risk Mgmt., 373 F. Supp. 2d 980, 982 n.3, 985-86 (D. N.D. 2005)
(Amerind I). The court noted that "[i]f needed, the parties can return to this forum for
any further litigation." Id. at 986. Thus, the parties returned to the Tribal Court.
On October 20, 2005, the plaintiffs filed a stipulation to dismiss TMHA with
prejudice in the Tribal Court. The Tribal Court granted the motion, leaving Amerind
as the sole defendant in the case. Amerind then filed a motion to dismiss, asserting
inter alia that it was entitled to tribal sovereign immunity as a § 477 corporation, and
that the plaintiffs' action could not proceed directly against Amerind because they
were not parties to ARMC's contract with TMHA. The Tribal Court denied Amerind's
motion to dismiss, holding that Amerind was not entitled to sovereign immunity
because it "does not stand in the same position as TMHA or the [Tribe]." The court
also held that the plaintiffs could proceed directly against Amerind because, under
Turtle Mountain tribal law, claimants may proceed directly against an insurer if the
insured was required by federal law to obtain insurance designed to protect the public
against losses. The Tribal Court's decision did not address Amerind's specific
contention that it was entitled to sovereign immunity in its own right as a § 477
corporation. Amerind appealed to the Turtle Mountain Tribal Court of Appeals
(Tribal Court of Appeals).
Before the Tribal Court of Appeals, Amerind again asserted that it was entitled
to sovereign immunity as a § 477 corporation, and that the plaintiffs were prohibited
from maintaining a direct suit against Amerind. The Tribal Court of Appeals affirmed
the Tribal Court's denial of Amerind's motion to dismiss, reasoning that Amerind was
not entitled to share in TMHA's sovereign immunity, and that tribal law permitted the
plaintiffs' direct suit. Like the Tribal Court, the Tribal Court of Appeals failed to
specifically discuss Amerind's status as a § 477 corporation and whether Amerind was
entitled to sovereign immunity in its own right.
-4-
On September 4, 2007, Amerind commenced a declaratory judgment action in
federal district court, seeking a determination that the Tribal Court exceeded its
jurisdiction by exercising authority over Amerind, a nonmember of the Tribe, under
Montana v. United States, 450 U.S. 544, 565 (1981). Amerind also sought to enjoin
the plaintiffs3 from pursuing their tort action directly against Amerind in Tribal Court.
Amerind filed a motion for summary judgment on June 24, 2008. Inexplicably,
Amerind failed to raise the tribal immunity issue in either its complaint or in its
motion for summary judgment. Nevertheless, the plaintiffs' response to Amerind's
motion for summary judgment outlined provisions in the Scope of Coverage
agreement that allegedly waived ARMC's, and by extension Amerind's, sovereign
immunity. The plaintiffs' response also rhetorically inquired, "Why does AMERIND
argue that it is entitled to sovereign immunity when the policy clearly states
otherwise?" and asserted that "neither AMERIND nor TMHA is entitled to raise
sovereign immunity as a defense to the [plaintiffs'] claims."
The district court denied Amerind's motion for summary judgment, concluding
that under Montana, the Tribal Court had jurisdiction over Amerind because ARMC
entered into a consensual contractual relationship with TMHA to insure TMHA
against personal injury and property loss. Amerind Risk Mgmt. Corp. v. Malaterre,
585 F. Supp. 2d 1121, 1130 (D. N.D. 2008) (Amerind II). The court also incorporated
the Tribal Court of Appeals' decision by reference and sua sponte granted summary
judgment in favor of the plaintiffs, directing the parties to litigate the plaintiffs' suit
in the Tribal Court. Id. The district court did not address whether the doctrine of
tribal sovereign immunity affected the Tribal Court's jurisdiction–an issue raised in
Amerind I, discussed in the Tribal Court of Appeals' incorporated decision, and
addressed in the plaintiffs' response to Amerind's motion for summary judgment.
3
In this declaratory judgment action, Malaterre, Belgarde, and Thompson are
technically "defendants," but they are "plaintiffs" in the underlying Tribal Court
action, and we refer to them as "plaintiffs" here to avoid confusion.
-5-
Amerind appeals, asserting in part that the Tribal Court lacked jurisdiction over
Amerind under Montana. Amerind did not raise the tribal immunity issue in its
appellate brief, and we directed the parties to address whether tribal immunity barred
the plaintiffs' action against Amerind in the Tribal Court. See Taylor v. Alabama
Intertribal Council Title IV J.T.P.A., 261 F.3d 1032, 1034 (11th Cir. 2001) (per
curiam) (We may "sua sponte conduct an inquiry into whether a party enjoys Indian
sovereign immunity, as this consideration determines whether a court has jurisdiction
to hear an action.").
II. DISCUSSION
We have held that tribal sovereign immunity is a threshold jurisdictional
question.4 Hagen v. Sisseton-Wahpeton Cmty. Coll., 205 F.3d 1040, 1044 (8th Cir.
2000). "Indian tribes have long been recognized as possessing the common-law
immunity from suit traditionally enjoyed by sovereign powers."5 Santa Clara Pueblo
v. Martinez, 436 U.S. 49, 58 (1978). Thus, "[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). "A waiver of sovereign immunity may not be implied, but must be
unequivocally expressed by either the Tribe or Congress." Rupp v. Omaha Indian
Tribe, 45 F.3d 1241, 1244 (8th Cir. 1995).
4
Amerind concedes it voluntarily waived its tribal immunity in federal court by
filing this declaratory judgment action, so our jurisdiction is not in dispute. See Rupp
v. Omaha Indian Tribe, 45 F.3d 1241, 1244-45 (8th Cir. 1995). Therefore, our
question on appeal is whether tribal sovereign immunity precludes the Tribal Court
from exercising jurisdiction over the plaintiffs' underlying tort action.
5
Amerind is a § 477 corporation that is jointly owned by the Charter Tribes, not
the Turtle Mountain Band of Chippewa Indians. "The power to subject other
sovereigns to suit in tribal court [is] . . . not a part of the tribes' inherent sovereignty."
Montana v. Gilham, 133 F.3d 1133, 1138 (9th Cir. 1998).
-6-
To determine whether Amerind is immune from the plaintiffs' suit in Tribal
Court, we must first determine whether Amerind is entitled to sovereign immunity.
While Amerind is not itself a tribe, "[i]t is . . . undisputed that a tribe's sovereign
immunity may extend to tribal agencies." Hagen, 205 F.3d at 1043. As discussed
above, Amerind was incorporated by three Charter Tribes and issued a federal charter
under 25 U.S.C. § 477. Several courts have recently recognized that § 477
corporations are entitled to tribal sovereign immunity. See Memphis Biofuels, LLC
v. Chickasaw Nation Indus., Inc., 585 F.3d 917, 920-21 (6th Cir. 2009); Bales v.
Chickasaw Nation Indus., 606 F. Supp. 2d 1299, 1304 (D. N.M. 2009); Sanchez v.
Santa Ana Golf Club, Inc., 104 P.3d 548, 551 (N.M. Ct. App. 2004). As the Sixth
Circuit emphasized in Memphis Biofuels, "the language of [§ 477] itself–by calling
the entity an 'incorporated tribe'–suggests that the entity is an arm of the tribe." 585
F.3d at 921.
We also note that Amerind is not an ordinary insurance company. Indeed,
Amerind's purpose is to administer a self-insurance risk pool for Indian Housing
Authorities and Indian tribes. See Self-Insurance Plans Under the Indian Housing
Block Grant Program, 71 Fed. Reg. 11464, 11464 (proposed Mar. 7, 2006)
("AMERIND continues to administer the approved self-insurance plan for properties
funded under NAHASDA, pursuant to 24 CFR 1000.138."). Because Amerind is a
§ 477 corporation that administers a tribal self-insurance risk pool, we hold that
Amerind "serves as an arm of the [Charter Tribes] and not as a mere business and is
thus entitled to tribal sovereign immunity." Hagen, 205 F.3d at 1043.
Given that Amerind is entitled to tribal immunity, our next question is whether
Amerind's immunity has been waived.6 The plaintiffs bear the burden of proving that
6
The plaintiffs assert that we may not consider Amerind's federal corporate
charter because it was not introduced into the record in Amerind II. We note that
citations to and quotations from Amerind's federal charter appear in the exhibits
attached to the plaintiffs' response to Amerind's motion for summary judgment in
-7-
either Congress or Amerind has expressly and unequivocally waived tribal sovereign
immunity. Garcia v. Akwesasne Hous. Auth., 268 F.3d 76, 84 (2d Cir. 2001); Welch
v. United States, 409 F.3d 646, 651 (4th Cir. 2005). The plaintiffs do not argue that
Congress waived Amerind's sovereign immunity, so our focus is solely on whether
Amerind waived its sovereign immunity.
The plaintiffs assert that Amerind waived its sovereign immunity by failing to
raise the issue before the district court in Amerind II. However, our court has held
that sovereign immunity is a "threshold jurisdictional matter" and a "jurisdictional
prerequisite." Hagen, 205 F.3d at 1044 (quotations omitted). Therefore, tribal
sovereign immunity may be raised for the first time on appeal, id., or raised sua sponte
by the court. Taylor, 261 F.3d at 1034. We also note that the tribal sovereign
immunity issue is not a newcomer to the litigation between these parties. Indeed, the
issue was raised in Amerind I, in the Tribal Court, in the Tribal Court of Appeals, and
it was discussed in the plaintiffs' response to Amerind's motion for summary judgment
in Amerind II. Accordingly, we hold that Amerind did not waive its tribal immunity
by failing to raise the issue in Amerind II, and we properly raised the issue sua sponte.
Amerind II. Moreover, the charter, which was issued by the Department of the
Interior, was introduced into evidence in Amerind I and in the Tribal Court.
Therefore, our consideration of the charter is appropriate. See Omaha Tribe of Neb.
v. Miller, 311 F. Supp. 2d 816, 819 n.3 (S.D. Iowa 2004) (taking judicial notice of
tribe's corporate charter as a public record); Biomedical Patent Mgmt. Corp. v. Cal.,
Dep't of Health Servs., 505 F.3d 1328, 1331 n.1 (Fed. Cir. 2007) (taking judicial
notice of court filings from previous litigation between the parties as public records);
Attorney's Process & Investigation Servs., Inc. v. Sac & Fox Tribe of the Miss. in
Iowa, 609 F.3d 927, 937 (8th Cir. 2010) ("In analyzing the jurisdictional issue we rely
on the record developed in the tribal courts . . . ."), cert. denied, 2011 WL 134297(U.S. Jan. 18, 2011). Because it is undisputed that Amerind is a § 477 corporation that
administers a self-insurance risk pool, we only consider the charter's specific
provisions to determine whether Amerind waived its sovereign immunity. Given that
the plaintiffs bear the burden of proving waiver, their attempt to exclude the charter
from our discussion is counterintuitive.
-8-
The plaintiffs' second waiver argument is more complex. The plaintiffs begin
their argument by pointing out that Amerind's federal charter authorizes Amerind to
"assume the obligations and liabilities of [ARMC]." The plaintiffs then assume,
without citing any supporting authority, that this provision constitutes an express
waiver of Amerind's sovereign immunity so long as ARMC was amenable to the
plaintiffs' pending suit in Tribal Court. Finally, the plaintiffs point to provisions in the
contract between ARMC and TMHA that purportedly waive ARMC's, and by
extension Amerind's, tribal immunity. Because we hold that the general assumption
of ARMC's obligations and liabilities in Amerind's federal charter does not constitute
an express waiver of Amerind's sovereign immunity, we need not address the
plaintiffs' arguments regarding ARMC's purported waiver of its sovereign immunity.7
To determine whether Amerind waived its sovereign immunity when it
expressly assumed ARMC's "obligations and liabilities," we find the Eleventh
Circuit's decision in Asociacion De Empleados Del Area Canalera v. Panama Canal
Commission, 453 F.3d 1309, 1316 (11th Cir. 2006) instructive. There, plaintiffs sued
the Panama Canal Commission (PCC), a wholly-owned United States corporation, for
unpaid work benefits. Id. at 1311-12. While the suit was pending, Congress
terminated the PCC and, through 22 U.S.C. § 3712(e)(2), directed the General Service
Administration (GSA) to "make payments of any outstanding liabilities of the PCC."
7
A sovereign entity does not automatically waive its sovereign immunity
through the mere act of succeeding a corporation that is either not entitled to sovereign
immunity or that has waived such immunity. See Asociacion De Empleados Del Area
Canalera v. Panama Canal Comm'n, 453 F.3d 1309, 1315-16 (11th Cir. 2006);
Maysonet-Robles v. Cabrero, 323 F.3d 43, 49-50 (1st Cir. 2003); Kroll v. Bd. of Trs.
of the Univ. of Ill., 934 F.2d 904, 909 (7th Cir. 1991). In other words, a predecessor
corporation's amenability to a pending suit is irrelevant unless the sovereign
successor's immunity has been expressly and unequivocally waived. Asociacion De
Empleados, 453 F.3d at 1316; Maysonet-Robles, 323 F.3d at 50; Kroll, 934 F.2d at
909. Thus, if Amerind did not expressly waive its sovereign immunity, we need not
determine whether ARMC was immune from suit.
-9-
Id. at 1312 (internal quotation omitted). The plaintiffs argued that by directing the
GSA to pay the PCC's "outstanding liabilities," Congress unequivocally waived the
GSA's sovereign immunity as to the pending suit. The Eleventh Circuit disagreed,
holding that "to accept [plaintiffs'] position would be to imply a waiver of immunity,
which we will not do." Id. at 1315.
Precedent from our circuit also supports the conclusion that Amerind's general
assumption of ARMC's "obligations and liabilities" was, at most, an implied waiver
of sovereign immunity. In American Indian Agricultural Credit Consortium, Inc. v.
Standing Rock Sioux Tribe, 780 F.2d 1374 (8th Cir. 1985), a creditor sued the
Standing Rock Sioux Tribe after the tribe defaulted on a promissory note. The
promissory note stated that, upon the tribe's default, the creditor was entitled to (1)
"rights and remedies provided by law," and (2) reimbursement of attorney fees
incurred in collection efforts. Id. at 1376. The note also stated that such rights and
obligations would be subject to the law of the District of Columbia. Id. We rejected
the creditor's argument that the promissory note constituted an express waiver of the
Tribe's sovereign immunity. Specifically, we emphasized that through the note, the
Tribe did not "explicitly consent to submit any dispute over repayment on the note to
a particular forum, or to be bound by its judgment." Id. at 1380. Accordingly, we
held that "[t]o derive an express waiver of sovereign immunity" from the promissory
note "simply asks too much." Id. at 1380-81.
Like the promissory note in Standing Rock, and like the federal statute in
Asociacion De Empleados, Amerind's federal charter does not state that Amerind, in
assuming ARMC's obligations and liabilities, consents to submit to a particular forum,
or consents to be bound by its judgment. Cf. Rosebud Sioux Tribe v. Val-U Const.
Co. of S.D., Inc., 50 F.3d 560, 563 (8th Cir. 1995) (holding that tribe waived its
immunity as to contract claims by expressly designating an arbitral forum to settle
contract disputes and agreeing to arbitration rules that explicitly provided for judicial
enforcement of arbitration awards). In fact, Article 8, Section 8.18 of Amerind's
charter provides that Amerind may "sue and be sued in the Corporation's name in
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courts of competent jurisdiction within the United States, but only to the extent
provided in and subject to the limitations stated in Article 16 of this Charter."
(emphasis added). Article 16.4 provides:
Any waiver [of tribal immunity] by the Corporation . . . shall be in the
form of a resolution duly adopted by the Board of Directors, which
resolution shall not require the approval of the Charter Tribes or the
Secretary of the Interior. The resolution shall identify the party or
parties for whose benefit the waiver is granted, the transaction or
transactions and the claims or classes of claim for which the waiver is
granted, the property of the Corporation which may be subject to
execution to satisfy any judgment which may be entered in the claim,
and shall identify the court or courts in which suit against the
Corporation may be brought. Any waiver shall be limited to claims
arising from the acts or omissions of the Corporation, its Directors,
officers, employees or agents, and shall be construed only to effect the
property and Income of the Corporation.
(emphasis added). The plaintiffs have provided no evidence that Amerind's Board of
Directors ever adopted a resolution waiving Amerind's immunity as to the plaintiffs'
pending suit, and absent such a resolution, we cannot say that Amerind unequivocally
waived its sovereign immunity when it generally assumed ARMC's "obligations and
liabilities."8 See Memphis Biofuels, 585 F.3d at 921-22 (where federal charter
required board resolution to waive tribal immunity, immunity was not waived without
such a resolution even though the corporation's contract with the plaintiff expressly
waived all immunities).
8
We disagree with the dissent's contention that we should remand to the district
court for the plaintiffs to conduct further discovery. In Amerind I, Amerind's motion
to dismiss asserted that Amerind's Board of Directors had not adopted a resolution to
waive Amerind's tribal immunity and the plaintiffs were permitted discovery. Later,
the parties litigated the tribal immunity issue in both the Tribal Court and the Tribal
Court of Appeals. Now, more than six years after Amerind raised the tribal immunity
issue in Amerind I, the plaintiffs can point to no evidence that Amerind's Board of
Directors ever passed a resolution to waive Amerind's sovereign immunity as to the
plaintiffs' claims. Under these circumstances, we find that remanding this case for
another round of discovery is neither appropriate nor necessary.
-11-
Thus, we hold that Amerind is entitled to sovereign immunity and that the
plaintiffs have failed to show that Amerind expressly waived such immunity as to the
underlying personal injury/wrongful death action in this case. Given that Amerind did
not waive its sovereign immunity, we need not decide whether ARMC was amenable
to the plaintiffs' suit.9 Accordingly, the Tribal Court does not have jurisdiction over
9
Although we need not decide whether ARMC was amenable to suit, we
disagree with the dissent's assertion that ARMC waived its immunity through the
Scope of Coverage agreement's arbitration provision. The provision in question is
housed under the heading "Non-Binding Arbitration" and provides: "If [TMHA] and
[ARMC] do not agree whether coverage is provided by the Scope of Coverage
document, then either party may make a written demand for arbitration." (emphasis
added). This provision is readily distinguishable from the arbitration provisions that
operated as express waivers of tribal immunity in C & L Enterprises, Inc. v. Citizen
Band Potawatomi Indian Tribe of Oklahoma, 532 U.S. 411 (2001), and Rosebud, 50
F.3d 560 (8th Cir. 1995). Unlike the provision in the present case, the arbitration
provisions in those cases expressly required binding arbitration and judicial
enforcement of arbitration awards. C & L, 532 U.S. at 414-15; Rosebud, 50 F.3d at
562-63. Also, unlike the plaintiffs in the present case, the plaintiffs in both C & L and
Rosebud were parties to the contracts containing the arbitration provisions at issue.
C & L, 532 U.S. at 414; Rosebud, 50 F.3d at 563. And finally, the Rosebud court
held that the binding arbitration provision in that case waived tribal immunity as to
contract claims, but not as to tort claims. Rosebud, 50 F.3d at 563. It is a mystery,
then, how the non-binding arbitration provision in the agreement between ARMC and
TMHA waived ARMC's tribal immunity as to the plaintiffs' underlying tort action.
The dissent also places undue emphasis on the Scope of Coverage document's
conformity provision, which provides that "[i]f any provision of this policy conflicts
with the tribal laws of [the Tribe], this policy is amended to conform to those laws."
In order to drum up a conflict between the policy and Turtle Mountain tribal law,
which permits direct suits against insurers under certain circumstances, the dissent
relies on a remote provision housed in the policy's "Tribal Housing Officials Liability
Coverage" section. The provision provides: "No action shall be taken against the
Insurer unless, as a condition precedent thereto, . . . the Insureds' obligation to pay
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the plaintiffs' direct suit against Amerind.
III. CONCLUSION
We reverse the district court and remand with instructions to enjoin the
plaintiffs from proceeding against Amerind in the Tribal Court.
BEAM, Circuit Judge, concurring specially.
In Nevada v. Hicks, 533 U.S. 353, 373-74 (2001), the Court rejected the notion
that qualified immunity claims should be considered in reviewing tribal court
jurisdiction because such immunity defenses are not jurisdictional. Although Hicks
did not specifically discuss sovereign immunity, which has been frequently described
as a threshold jurisdictional issue in our circuit, the Tenth Circuit concluded that Hicks
stands for the proposition that courts should consider tribal court jurisdiction under
Montana "before reaching the sovereign immunity question." MacArthur v. San Juan
County, 309 F.3d 1216, 1227 (10th Cir. 2002). In the event that the Tenth Circuit's
sequencing of these issues is correct, I would also reverse the district court's
conclusion that the Tribal Court had jurisdiction over the plaintiffs' underlying tort
action under Montana.
"We review a district court's grant of summary judgment de novo, viewing the
facts and all reasonable inferences in the light most favorable to the nonmoving
party." Copeland v. Locke, 613 F.3d 875, 879 (8th Cir. 2010) (quotation omitted).
shall have been fully and finally determined either by judgment against them or by
written agreement between them, the claimant, and the Insurer." While this provision
of the policy arguably conflicts with Turtle Mountain tribal law, a closer reading of
the policy reveals that this section defines "Insurer" as "United States Fire Insurance
Company." It is not clear how this provision, which applies to an entirely different
insurer, could possibly operate as an express waiver of ARMC's immunity.
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"The extent of tribal court subject matter jurisdiction over claims against nonmembers
of the Tribe is a question of federal law which we review de novo." Attorney's
Process & Investigation Servs., Inc. v. Sac & Fox Tribe of the Miss. in Iowa, 609 F.3d
927, 934 (8th Cir. 2010), cert. denied, 2011 WL 134297 (U.S. Jan. 18, 2011).
Under Montana and its progeny, a tribal court's civil jurisdiction generally does
not extend to the activities of nonmembers of the tribe. Montana, 450 U.S. at 565;
Strate v. A-1 Contractors, 520 U.S. 438, 453 (1997); see Attorney's Process, 609 F.3d
at 936 ("Montana's analytic framework now sets the outer limits of tribal civil
jurisdiction–both regulatory and adjudicatory–over nonmember activities on tribal and
nonmember land."). The plaintiffs concede that Amerind is a nonmember of the
Tribe,10 but they contend that ARMC, and by extension Amerind, is subject to the
Tribal Court's jurisdiction because ARMC entered into a consensual agreement with
TMHA, an entity of the Tribe. This argument is premised on Montana's "consensual
relationship" exception, which provides that a tribal court retains jurisdiction over "the
activities of nonmembers who enter consensual relationships with the tribe or its
members, through commercial dealing, contracts, leases, or other arrangements."
Montana, 450 U.S. at 565; Strate, 520 U.S. at 456-57. This is a limited exception,
however. The tribe retains jurisdiction only over suits which "have a nexus to the
consensual relationship itself." Atkinson Trading Co. v. Shirley, 532 U.S. 645, 656
(2001). In other words, "[a] nonmember's consensual relationship in one area . . . does
not trigger tribal civil authority in another–it is not in for a penny, in for a Pound." Id.(internal quotation omitted).
Here, the district court agreed with the plaintiffs and found that their direct suit
against Amerind fell under Montana's consensual relationship exception. The court
emphasized that the dispute between Amerind and the plaintiffs was "distinctively
10
Amerind is jointly owned by three Charter Tribes, none of which is the Turtle
Mountain Band of Chippewa Indians (Tribe).
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tribal in nature," Amerind II, 585 F. Supp. 2d at 1129, and that the contract between
ARMC and TMHA was "directly at the heart of this dispute." Id. I disagree.
While the scope of tribal courts' jurisdiction over nonmembers is admittedly
"ill-defined," Hicks, 533 U.S. at 376 (Souter, J., concurring), the following cases are
instructive in applying Montana to the facts presented here. In Strate, Gisela
Fredericks was seriously injured when her automobile collided with a gravel truck
driven by Lyle Stockert and owned by A-1 Contractors (A-1), Stockert's employer.
520 U.S. at 443. The accident occurred on a North Dakota state highway that ran
through the Fort Berthold Indian Reservation, home of the Three Affiliated Tribes.
Id. at 442-43. Although Fredericks, Stockert, and A-1 were all nonmembers of the
Tribes, Fredericks filed suit in tribal court under Montana's consensual relationship
exception. Id. at 443. Fredericks argued that the tribal court had jurisdiction over the
suit because A-1 was working on the reservation pursuant to a subcontract with a
corporation wholly owned by the Tribes. The Supreme Court rejected this argument,
reasoning that "[a]lthough A-1 was engaged in subcontract work on the Fort Berthold
Reservation, and therefore had a 'consensual relationship' with the Tribes, Gisela
Fredericks was not a party to the subcontract, and the [T]ribes were strangers to the
accident." Id. at 457 (second alteration in original) (internal quotation omitted) .
In Nord v. Kelly, 520 F.3d 848 (8th Cir. 2008), we considered a case factually
similar to Strate. There, Chad Nord, a non-Indian, was driving a semi-truck owned
by Nord Trucking when he collided with an automobile driven by Donald Kelly, a
member of the Red Lake Band of Chippewa Indians. Id. at 851. The accident
occurred on a Minnesota state highway that ran through the Red Lake Indian
Reservation. Id. Kelly sued Nord in tribal court under Montana's consensual
relationship exception, emphasizing that Nord Trucking had a consensual commercial
relationship with the Red Lake Band to haul and remove timber from the reservation.
We disagreed, concluding that "the accident gave rise to a simple tort claim between
strangers, not a dispute arising out of the commercial relationship." Id. at 856
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(emphasis added). Importantly, we also determined that whether Nord was driving
in connection with Nord Trucking's contract with the Red Lake Band at the time of
the accident was immaterial because "the dispute merely involves the tortious conduct
of a run-of-the-mill highway accident between strangers, and no amount of discovery
can alter the nature of that claim." Id. (internal quotation omitted). Note that in Nord,
unlike in Strate, the plaintiff was a member of the tribe whose court was attempting
to assert jurisdiction.
In the present case, the plaintiffs initially filed suit against TMHA in the Tribal
Court, asserting that the TMHA negligently maintained a house it leased to individuals
on the Turtle Mountain Indian Reservation. The plaintiffs amended their complaint
to include ARMC as a defendant because ARMC was TMHA's insurer. Then, they
dismissed TMHA with prejudice, leaving Amerind, ARMC's successor, as the sole
defendant in the suit. Thus, what began as a distinctively tribal personal
injury/wrongful death suit between the plaintiffs and TMHA became a suit between
the plaintiffs and Amerind–i.e., a suit between "strangers." As in Strate and Nord, the
plaintiffs are not parties to ARMC's contract with TMHA. Indeed, the Scope of
Coverage agreement expressly states that "[t]his . . . document is a contract between
you and us," defining "you" as TMHA and "us" as ARMC. The agreement also
expressly excludes "[t]enants and participants of mutual help home ownership
programs" from the definition of "Covered Person."
I disagree with the district court's determination that "[t]he contract between
[ARMC] and [TMHA] is directly at the heart of this dispute." Amerind II, 585 F.
Supp. 2d at 1129. In reality, it is TMHA's alleged negligence that is "directly at the
heart" of the plaintiffs' underlying personal injury and wrongful death claims. The
district court itself recognized that, even under Turtle Mountain tribal law, the
secondary question of whether the ARMC policy covers the plaintiffs' losses does not
arise unless and until "the plaintiffs . . . can establish that [TMHA] was negligent and
that such negligence was the proximate cause of the injuries sustained by the
plaintiffs." Id. at 1130.
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While ARMC had a consensual relationship with TMHA, it was TMHA's
alleged negligence, not ARMC's contractual relationship with TMHA, that gave rise
to the plaintiffs' personal injury/wrongful death suit. The Supreme Court has
cautioned against broadly applying Montana's exceptions and made it clear that when
it comes to a nonmember's consensual relationship with a tribe or its members, it is
not "in for a penny, in for a Pound." Atkinson, 532 U.S. at 656 (quotation omitted).
Accordingly, I would find that the Tribal Court does not have jurisdiction over the
plaintiffs' direct suit against Amerind under Montana.
BYE, Circuit Judge, dissenting.
I respectfully dissent from the holding as to the Tribal Court lacking jurisdiction
over the three tribal members' direct suit against Amerind, a holding the majority
justifies on the grounds Amerind is entitled to tribal immunity.
First, I believe Amerind waived its immunity in the contract between itself and
the Turtle Mountain Housing Authority (TMHA). Second, even assuming Amerind
did not waive its immunity, the procedural posture of this case demands us to allow
the three tribal members an opportunity to conduct discovery to determine whether
Amerind adopted a corporate resolution waiving its immunity, or otherwise waived
its immunity with the requisite clarity by means of its conduct. Finally, I believe the
result in this case is perverse. As a condition of receiving federal funds, Congress
mandated tribes and tribal housing authorities be required to purchase insurance. As
a practical matter, requiring the purchase of insurance is perhaps the consummate
indication Congress intended tribes and tribal housing authorities would be subject to
suit. The fact that we now recognize Amerind – the commercial entity created for the
very purpose of fulfilling such Congressional mandate – to itself be immune from suit,
may require the Supreme Court to re-examine the "wisdom of perpetuating the
doctrine [of tribal immunity]." Kiowa Tribe of Okla. v. Mfg. Techs., Inc., 523 U.S.
751, 758 (1998).
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I
While I recognize a waiver of tribal immunity must either be "unequivocally
expressed" by Congress, Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58 (1978), or
"waived, with the requisite clarity" by the tribe itself, C & L Enters., Inc. v. Citizen
Band Potawatomi Indian Tribe of Okla., 532 U.S. 411, 418 (2001), I believe the
unique circumstances encountered in this case do indicate Amerind waived any tribal
immunity it may have enjoyed.
The arbitration clause in the relevant insurance policy expressly states coverage
disputes between Amerind and the TMHA were arbitrable "in the tribal jurisdiction
in which the address shown in the Certificate of Coverage is located." The arbitration
clause further provided local tribal laws were applicable, and an arbitrator's decision
could be "appealed to a tribal court of competent jurisdiction." In C & L Enterprises,
the Supreme Court held a tribe clearly waived its tribal immunity by entering into a
contract containing an arbitration clause in which the tribe expressly agreed to
arbitrate disputes arising under the contract and to allow an arbitration award to be
enforced "in any court having jurisdiction thereof." 532 U.S. at 414. The Court
explained it was resolving a conflict between "several state and federal courts [which]
held that an arbitration clause, kin to the one now before us, expressly waives tribal
immunity from a suit arising out of the contract" and some courts which held a tribe
had not waived its immunity despite the presence of such a clause. Id. at 417-18
(emphasis added). In resolving the conflict, the Court cited with approval the
following reasoning from the Supreme Court of Alaska:
[W]e believe it is clear that any dispute arising from a contract cannot
be resolved by arbitration, as specified in the contract, if one of the
parties intends to assert the defense of sovereign immunity. . .. The
arbitration clause . . . would be meaningless if it did not constitute a
waiver of whatever immunity [the Tribe] possessed.
Id. at 422 (quoting Native Vill. of Eyak v. GC Contractors, 658 P.2d 756, 760 (Alaska
1983)) (emphasis added).
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The Eighth Circuit had addressed this same issue prior to C & L Enterprises,
also deciding a tribe clearly waived its immunity "with respect to claims under the
contract" by entering into an agreement containing an arbitration clause, concluding
"[b]y definition such disputes could not be resolved by arbitration if one party
intended to assert sovereign immunity as a defense. . . . The parties clearly manifested
their intent to resolve disputes by arbitration, and the Tribe waived its immunity with
respect to any disputes under the contract." Rosebud Sioux Tribe v. Val-U Constr.
Co. of S.D., Inc., 50 F.3d 560, 562-63 (8th Cir. 1995) (emphasis added).
Under Rosebud Sioux Tribe and C & L Enterprises, the arbitration clause in
the insurance policy issued by Amerind clearly manifests Amerind's intent to waive
immunity with respect to any disputes arising under the contract (i.e., coverage
disputes) between itself and the TMHA.
The tribal court lawsuit did not, however, begin as a coverage dispute between
Amerind and the TMHA; it was commenced as a wrongful death action filed by the
three tribal members against the TMHA. Amerind was later added to the suit and,
pursuant to tribal law, the suit became a direct action between Amerind and the three
tribal members seeking insurance coverage up to the amount purchased by the TMHA.
It was at that point Amerind sought to assert a sovereign immunity defense, which
defense was rejected by the tribal court. Because the tribal lawsuit did not start as a
coverage dispute between Amerind and the TMHA, but is now a coverage dispute, the
question remains whether Amerind's clear waiver of immunity with respect to
coverage disputes should apply. I believe, under the unique facts encountered in this
case, such waiver still applies.
In addition to the arbitration clause, the policy also contained a clause stating
the policy would conform to tribal law whenever the policy conflicted with such tribal
law. As noted above, tribal law provides insurers of a tribal entity to be subject to
direct actions when the tribal entity purchases the insurance pursuant to a mandate of
federal law, and the federal law reflects an intent to provide remedies to third parties
injured by the tribe. The policy's prohibition on direct actions against an insurer
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(before the insured's obligation to pay is finally determined) conflicts with this
principle of tribal law. Thus, the conforming clause applies. Amerind agreed the
policy would conform to tribal law.
The result is this coverage dispute is being litigated directly between the tribal
members and Amerind rather than between the TMHA and Amerind (or as a personal
injury suit between the tribal members and the TMHA). In other words, Amerind's
own contract operates in a manner in which coverage disputes may be resolved
directly between itself and third party claimants, rather than between itself and the
TMHA. This fact, coupled with Amerind's waiver of immunity "with respect to any
disputes under the contract," Rosebud Sioux Tribe, 50 F.3d at 563, indicates Amerind
waived its tribal immunity under the unique circumstances involved in this case.
II
Even assuming the arbitration clause does not operate as a clear waiver of
immunity, I believe the procedural posture of this case requires us to remand it to
allow the three tribal members to conduct jurisdictional discovery in the district court.
Amerind initiated this federal declaratory judgment action against the three
tribal members and, as the majority acknowledges, voluntarily waived its tribal
immunity in federal court by doing so. See Rupp v. Omaha Indian Tribe, 45 F.3d
1241, 1244-45 (8th Cir. 1995) (concluding a tribe waived its sovereign immunity by
filing an action in federal court asking for something more than injunctive relief).
Significantly absent from Amerind's complaint for declaratory relief is any claim
whatsoever as to the tribal court lacking jurisdiction over Amerind because of tribal
immunity. Such was not a ground upon which Amerind claimed a right to declaratory
relief in federal court. In fact, Amerind never raised the issue of tribal immunity in
the district court at any time between the filing of its complaint on September 4, 2007,
and its notice of appeal to the Eighth Circuit on December 9, 2008.
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The issue of tribal immunity was not raised in this federal action until October
13, 2009, when this court itself asked the parties to be prepared to address certain
questions at the oral argument scheduled and held nine days later on October 22,
2009. Included among those questions were some pertaining to the issue of Amerind's
immunity in tribal court. While some of our questions asked about the absence in the
record of a corporate resolution waiving Amerind's immunity as to the three tribal
members' suit, we never directly asked Amerind whether such a resolution had, in
fact, ever been adopted.
In addressing our questions, Amerind renewed the unsuccessful argument it
had pursued in tribal court, which was based on its current corporate charter's
requirement that it must pass a resolution waiving immunity with respect to any
particular lawsuit. The three tribal members responded by explaining the absence of
a resolution under Amerind's current charter was irrelevant, because the current
charter did not become effective until April 15, 2004, well after the operative events
involved in this dispute.11 The tribal members further argued, to the extent the
applicable charter may be relevant, it was not part of this court's record, the district
court's record, or the tribal court record. The tribal members argued Amerind should
be deemed to have waived its immunity by abandoning the defense in the district court
proceedings, thereby depriving the tribal members of the opportunity to conduct
discovery and develop the factual predicate necessary to determine whether Amerind
waived its immunity.
While I would decline the tribal members' request to find Amerind waived its
immunity by failing to raise the issue in the district court, see, e.g., In re Prairie Island
Dakota Sioux, 21 F.3d 302, 304 (8th Cir. 1994) (recognizing the jurisdictional nature
11
The fire giving rise to the tribal court lawsuit occurred on October 19, 2002.
The applicable insurance policy was in effect from January 1, 2002, through
December 31, 2002. The three tribal members filed suit on January 23, 2003.
Amerind was added to the lawsuit on September 5, 2003.
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of tribal immunity); Hagen v. Sisseton-Wahpeton Cmty. Coll., 205 F.3d 1040, 1044
(8th Cir. 2000) (allowing parties to raise tribal immunity for the first time on appeal),
I nonetheless believe a remand is both necessary and appropriate.
As part of the grounds for concluding the tribal court lacked jurisdiction over
Amerind in the tribal court, the majority relies upon the lack of evidence in the federal
court record showing that Amerind's Board of Directors ever adopted a resolution
waiving Amerind's immunity. However, the three tribal members never had a reason
to look for that evidence (which may actually exist), because Amerind never raised
the issue of immunity in the district court. Since Amerind was the party which failed
to raise the issue in district court, it should not benefit from an incomplete factual
record on the issue. Under these circumstances, the appropriate remedy should be to
send this case back to the district court and allow the tribal members to conduct
discovery. See Miller v. First Serv. Corp., 84 F.2d 680, 683 (8th Cir. 1936) ("If . . .
a grave doubt of jurisdiction arises, we may remand to the District Court for hearing
and determination upon the question of jurisdiction."); see also United States ex rel.
Miss. Rd. Supply Co. v. H. R. Morgan, Inc., 528 F.2d 986, 987 (5th Cir. 1976)
(indicating "it is vital to a proper determination of [a] jurisdictional issue for the
record to be properly developed" and a remand is appropriate where the record is not
properly developed).
III
Finally, I am compelled to comment on what I view as a perverse result.
Amerind, a commercial entity created for the very purpose of insuring tribal entities,
is permitted to rely upon tribal immunity as a ground for avoiding its contractual
obligation to provide insurance coverage.
Indian housing authorities are required by federal law to carry liability
insurance in order to receive grant money under the Native American Housing
Assistance and Self-Determination Act (NAHASDA), 25 U.S.C. §§ 4101-4243.
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Amerind is an insurance risk pool initially created by a collection of tribes at the
encouragement of the United States Department of Housing and Urban Development
(HUD) and subsequently issued a federal corporate charter pursuant to 25 U.S.C.
§ 477. Thus, Amerind's very creation and existence arises from the Congressional
mandate which directs Indian tribes and tribal housing authorities protect themselves
from tort liability (i.e., lawsuits) as a condition of their receipt of federal funds. It
seems to me, therefore, that Congress necessarily envisioned the tribes and tribal
housing authorities would be subject to suit, and by logical extension their insurer
would likewise be subject to suit. If the insuring entity must itself consent to be sued
before the insurance is operative, the condition Congress placed on the receipt of
NAHASDA grant money seems tenuous at best, if not entirely illusory.
Prior to the Supreme Court's decision in Kiowa Tribe, some courts
distinguished between the governmental functions of tribes and the commercial
activities of tribal corporations when determining whether a particular tribal
corporation was immune from suit. See, e.g., Dixon v. Picopa Constr. Co., 772 P.2d
1104, 1109-11 (Ariz. 1989) (rejecting a tribal construction corporation's claim of
immunity in part because the corporation did not aid the tribe in carrying out tribal
governmental functions), abrogated by Kiowa Tribe, as recognized in Cash Advance
& Preferred Cash Loans v. State, 242 P.3d 1099, 1110 n.12 (Colo. 2010). One of the
relevant factors in determining whether a commercial tribal corporation might enjoy
the tribe's governmental immunity was whether the tribal corporation had purchased
insurance coverage. See Dixon, 772 P.2d at 1110 ("The purchase of liability
insurance is some evidence that the [Tribe] expected its corporation to be liable for its
torts."). Here, the argument against extending tribal immunity to shield Amerind
seems even stronger given the fact Amerind is actually an insurer and not just an
insured.
While I acknowledge Kiowa Tribe renders irrelevant the distinction between
governmental functions and commercial activities when determining whether a
particular tribal entity enjoys immunity, I find it very significant the Supreme Court
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did not address the distinction between tribal business corporations formed under 25
U.S.C. § 477 and tribal governments organized under 25 U.S.C. § 476. In this case,
Amerind's corporate charter was issued pursuant to § 477, not § 476. There is some
support for the argument that when Congress adopted the Indian Reorganization Act
(IRA) in 1934, it did not intend tribal business corporations formed under § 477 to
have the same immunity that tribal governments formed under § 476 would have. See
Gaines v. Ski Apache, 8 F.3d 726, 729 (10th Cir. 1993) (recognizing the distinction
between a tribe's governmental entity created under § 476 and a tribal business
corporation formed under § 477); Veeder v. Omaha Tribe of Neb., 864 F. Supp. 889,
900 (N.D. Iowa 1994) (pre-Kiowa Tribe case noting decisions wherein courts held
tribal corporations formed under § 477, as opposed to tribal governments organized
under § 476, waived sovereign immunity); see also William V. Vetter, Doing Business
with Indians and the Three "S"es: Secretarial Approval, Sovereign Immunity, and
Subject Matter Jurisdiction, 36 Ariz. L. Rev. 169, 175 & n.35 (1994) (distinguishing
between tribal governments formed under § 476 and tribal business corporations
formed under § 477, and noting Congress added the latter section to the IRA "because
of congressional concern that non-Indians would not do business with tribal
governments that are immune from suit.") (citing Hearings on H.R. 7902, 73d Cong.,
2d Sess. 90-100 (1934) and S. Rep. No. 1080, 73d Cong., 2d. Sess. (1934)). The
argument against extending tribal immunity to a § 477 corporation seems particularly
compelling when the commercial activity in which the corporation is engaged is
providing insurance against tort liability, a purpose utterly at odds with the concept
of immunity from suit.
In Kiowa Tribe, the Supreme Court questioned the "wisdom of perpetuating the
doctrine [of tribal immunity]" noting it developed "almost by accident" and "with little
analysis." 523 U.S. at 756-58. The Supreme Court suggested the continued
recognition of tribal immunity may no longer be "necessary to protect nascent tribal
governments from encroachments by States" and may "extend[] beyond what is
needed to safeguard tribal self-governance" in our current commerce, where "[t]ribal
enterprises now include ski resorts, gambling, and sales of cigarettes to non-Indians."
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Id. at 758. The Court acknowledged that "[i]n this economic context, immunity can
harm those who are unaware that they are dealing with a tribe, who do not know of
tribal immunity, or who have no choice in the matter, as in the case of tort victims."
Id. Ultimately, however, the Court "decline[d] to revisit [its] case law" and instead
chose to "defer to the role Congress may wish to exercise in this important judgment
[to abrogate the doctrine of tribal immunity]." Id. at 758, 760.
Where, as here, the already infirm concept of tribal immunity is extended so far
as to shield a corporate entity whose very existence is at odds with the concept of
immunity, it seems perhaps the time is now upon us to abrogate the doctrine.
IV
For the reasons expressed above, I respectfully dissent.
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