Klamath Claims Committee v. United States ( 2013 )

  •        NOTE: This disposition is nonprecedential.
      United States Court of Appeals
          for the Federal Circuit
                      UNITED STATES,
        Appeal from the United States Court of Federal
    Claims in No. 09-CV-00075, Judge Francis M. Allegra.
                   Decided: August 23, 2013
       MATTHEW J. KELLY, Fredericks Peebles & Morgan,
    LLP, of Washington, DC, argued for plaintiff-appellant.
    With him on the brief was THOMAS W. FREDERICKS.
        KATHERINE W. HAZARD, Attorney, Appellate Section,
    Environment & Natural Resources Division, United
    States Department of Justice, of Washington, DC, argued
    for defendant-appellee. With her on the brief was IGNACIA
    S. MORENO, Assistant Attorney General.
    2                         KLAMATH CLAIMS COMMITTEE    v. US
        MELODY L. MCCOY, Native American Rights Fund,
    Boulder, Colorado, argued for amicus curiae the Klamath
        Before PROST, BRYSON, and TARANTO, Circuit Judges.
    PROST, Circuit Judge,
         The Klamath Claims Committee (“KCC”) appeals two
    judgments of the United States Court of Federal Claims.
    The first is the court’s decision to dismiss the third and
    fourth claims of the KCC’s first amended complaint
    pursuant to Rule 19 of the Court of Federal Claims. We
    affirm that judgment on the basis of the court’s well-
    reasoned opinion. See FED. CIR. R. IOP 9 (10)(a) (We may
    affirm “on the basis of” a trial tribunal’s opinion in a
    nonprecedential disposition.). The second is the court’s
    dismissal of the KCC’s motion seeking leave to amend its
    complaint for the second time. We also affirm that deci-
    sion, but write briefly to address our reasoning for doing
        The Klamath and Modoc Tribes and the Yahooskin
    Band of Snake Indians comprise one federally-recognized
    tribal government (the “Tribes”). 1 Pursuant to its consti-
    tution and by-laws, the Tribes passed a resolution in 1952
    to create the KCC. 2 At that time, the Tribes anticipated
    the termination of its federal recognition, which later
        1   We use “Tribes” to refer to the single federally-
    recognized tribal entity.
        2   Since its origin, the KCC has had different forms
    and names. Because the historical structure and previous
    names of the KCC are not relevant to our decision, we
    refer to the Klamath Claims Committee and its progeny
    as simply the “KCC.”
    KLAMATH CLAIMS COMMITTEE    v. US                         3
    occurred through the Klamath Termination Act of 1954. 3
    The KCC’s purpose was to represent the interests of the
    Tribes’s final enrollees (the “1954 Enrollees”) in claims
    against the United States filed before and after termina-
    tion. A “reserve of necessary funds for prosecution” of
    such claims (the “Litigation Fund”) was created in 1958
    from monies due under the Termination Act. J.A. 734. 4
         In the years following its loss of federal recognition,
    the Tribes continued to exist as a self-governed organiza-
    tion and retained certain water and fishing rights. See 25
    U.S.C. § 564r (“[The] termination shall not affect the
    power of the tribe to take any action under its constitu-
    tion and bylaws that is consistent with [the Termination
    Act]”); 25 U.S.C. § 564m (stating that the Termination Act
    would not affect “any water rights” or “fishing rights or
    privileges”). Those rights were the foundation for several
    post-termination lawsuits that involved the Tribes and its
    members. As a result of those suits, the Ninth Circuit
    issued several opinions that detailed the scope of the
    Tribes’s right to self-governance and to natural resources
    following termination. See Kimball v. Callahan, 
    493 F.2d 564
     (9th Cir. 1974), cert. denied, 
    419 U.S. 1019
    (explaining that the Tribes’s hunting, fishing, and water
    rights survived the Termination Act); Kimball v. Calla-
    590 F.2d 768
    , 770-71 (9th Cir. 1979) (discussing
    which members of the Tribes could exercise tribal fishing
    rights after termination); United States v. Adair, 
    723 F.2d 1394
    , 1418 (9th Cir. 1983), cert. denied, 
    467 U.S. 1252
       3   Termination did not officially occur until 1961,
    when the United States had fulfilled all of its obligations
    under the Termination Act.
       4    The KCC refers to the fund as the “Litigation
    Trust Fund.” The government asserts that the proper
    name is the “Litigation Expense Fund.” We make no
    judgment on whether the funds are held in trust. We
    therefore use the term “Litigation Fund.”
    4                         KLAMATH CLAIMS COMMITTEE   v. US
    (1984) (addressing how the Tribes could effect a transfer
    of the hunting and fishing rights it retained after termi-
        In 1986, the Tribes regained federal recognition under
    the Klamath Indian Tribe Restoration Act. After the
    federally-recognized sovereignty of the Tribes was re-
    stored, the KCC continued to exist. The Tribal Council
    (the elected governmental body for the Tribes) appears to
    have supervised the KCC’s post-restoration activities,
    including the disbursement of money from the Litigation
    Fund. For example, in 1996, unused monies in the Litiga-
    tion Fund were distributed by the KCC to the 1954 Enrol-
    lees and their descendants under the supervision of the
    Tribal Council. See J.A. 227-28 (resolution authorizing
    the Bureau of Indian Affairs to distribute money from the
    Litigation Fund to the 1954 Enrollees). And in 2008, the
    Tribal Council authorized payments from the Litigation
    Fund for litigation expenses incurred by the KCC. See
    J.A. 234-35 (resolution authorizing the distribution of
    money from the Litigation Fund to pay litigation costs).
       The present suit began with a complaint filed by the
    KCC in February 2009. That complaint was amended
    once, as a matter of right, the following month.
         The amended complaint included four claims. The
    first two alleged wrongdoings by the government related
    to funds payable to the Tribes and its members under
    Section 13 of the Termination Act. The third and fourth
    claims asserted a taking of private property and breach of
    fiduciary duty arising from the removal of the Chiloquin
    Dam—an act that allegedly affected water flow and
    fishing in waterways used by the Tribes.
        Shortly after the amended complaint was filed, the
    government moved to dismiss all four claims. As part of
    its motion, the government argued that the KCC lacked
    standing to bring its claims. It asserted that the KCC did
    not have a legally cognizable interest in the Section 13
    KLAMATH CLAIMS COMMITTEE     v. US                          5
    funds, the Chiloquin Dam, or the tribal water and fishing
    rights that were apparently affected by the dam’s remov-
    al. According to the government, the KCC failed to show
    that “it, instead of the Tribes, [was] the proper entity to
    assert [its] claims.” Def.’s Mot. to Dismiss 19 n.9, Kla-
    math Claims Comm. v. United States, No. 09-cv-75, (Fed.
    Cl. May 7, 2009), ECF No. 9.
         After briefing and a hearing on the motion to dismiss,
    the Court of Federal Claims ordered the KCC to file “an
    affidavit or resolution from an appropriate Tribal official
    or officials directly addressing [the KCC’s] authority to
    file a claim in this matter.” J.A. 328. In June 2010, the
    KCC submitted a letter from the Chairman of the Tribal
    Council that stated that neither he nor the Council was
    “in a position to lend support to litigation over which the
    Klamath Tribes have no control, particularly when the
    litigation may potentially affect Tribal rights.” J.A. 331.
        Following the KCC’s inability to obtain the Tribal
    Council’s approval, the Court of Federal Claims ruled in
    February 2011 that the Tribes was a required party under
    Rule 19. 5 Klamath Claims Comm. v. United States, 
    97 Fed. Cl. 203
    , 212-13 (Fed. Cl. 2011). The court reasoned,
    in part, that the Tribes “claimed an interest in the re-
    maining subject matter of th[e] lawsuit” and “disposing of
    th[e] case in the Tribes’ absence may, as a practical mat-
    ter, impede the Tribes’ ability to protect that interest.”
    Id. at 213-14. Because it found the Tribes to be a neces-
    sary party to the litigation, the court formally invited it to
    intervene. Id. at 214.
        In April 2011, the Tribes declined the court’s invita-
    tion. It agreed that it had an interest in the suit and that
        5   The Court of Federal Claims also dismissed the
    first and second claims of the amended complaint on
    statute of limitation grounds. The KCC has not appealed
    the dismissal of those claims.
    6                           KLAMATH CLAIMS COMMITTEE     v. US
    further adjudication may “impede [its] ability to protect
    that interest.” J.A. 361. The Tribes also informed the
    court that the KCC “ha[d] no authority to speak for or
    represent the Tribes.” Id.
        In response to the Tribes’s refusal to intervene, the
    court ordered briefing on whether the Tribes was an
    indispensable party. After the parties filed their briefs,
    the Tribes submitted an amicus brief to the court. In it,
    the Tribes “expressly reserve[d] its sovereign immunity
    from suit” and again asserted that the KCC had no au-
    thority to represent it. It also argued that the rights at
    issue “belong to the Tribes” and that the KCC was “acting
    hostilely to the Tribes, asserting control over tribal rights,
    and inviting th[e] Court to de-legitimize the Tribes.”
    Klamath Claims Comm. v. United States, 
    106 Fed. Cl. 87
    92 (Fed. Cl. 2012) (internal quotation marks omitted).
        In April 2012, months after the Rule 19 briefing con-
    cluded (and years after the suit began), the KCC filed a
    motion for leave to amend its complaint. That proposed
    second amended complaint included new facts related to
    the third and fourth claims of the first amended com-
    plaint and added three new claims against the govern-
    ment. All of those new claims related to the Litigation
    Fund. One demanded an order directing the government
    to pay the KCC’s attorney from monies in the Fund. The
    other two requested damages for breach of trust and
    mismanagement of the Fund.
        Shortly after the KCC filed its motion to amend, the
    Court of Federal Claims ruled that dismissal under Rule
    19 was appropriate because the Tribes was an indispen-
    sable party for the third and fourth claims of the amended
    complaint. In addition to citing concerns and respect for
    the Tribes’s sovereignty and the risk of “multiple and
    conflicting claims” against the government, the court
    reasoned that the resolution of the third and fourth
    claims in the amended complaint required adjudication of
    substantial tribal interests in water and fishing rights
    that “might be impaired by an adverse ruling.” Klamath
    KLAMATH CLAIMS COMMITTEE   v. US                         7
    Claims Comm., 106 Fed. Cl. at 96. In light of its Rule 19
    decision, the court dismissed the KCC’s motion to amend
    as moot. Id. at 97 n.22.
       The KCC filed a timely appeal. We have jurisdiction
    under 28 U.S.C. § 1295(a)(3).
         The KCC raises two points on appeal. First, the KCC
    believes that the Court of Federal Claims erred in dis-
    missing the third and fourth claims of its amended com-
    plaint under Rule 19. We see no such error and affirm the
    court’s judgment on the basis of its well-reasoned opin-
    ion. 6 Second, the KCC argues that the court erroneously
    dismissed its motion to amend as moot. It asserts that
    the motion was not mooted by the Rule 19 dismissal of the
    third and fourth claims in its amended complaint.
        We also affirm the dismissal of the KCC’s motion to
    amend. Although the Court of Federal Claims character-
    ized the motion to amend as “moot” in light of its ruling
    on the Rule 19 issue, we do not interpret the court’s
    statement as holding that the dispute relating to the
    motion was moot in the formal sense, but rather as a
    statement that it was unnecessary for the court to ad-
    dress that issue. Because, given the facts here, the Tribes
    was unquestionably an indispensable party under Rule 19
    for all of the new claims the KCC desired to add in its
    proposed second amended complaint, we uphold the
    denial of that motion on the ground that the amendment
    would have been futile in light of the Rule 19 problem
    that would have required dismissal of those claims. 7 See
       6    None of the new facts in the proposed second
    amended complaint present any basis for reversing the
    Rule 19 dismissal of the third and fourth claims of the
    first amended complaint.
       7    Because of the facts here, we do not decide wheth-
    er the Rule 19 dismissal of some of the KCC’s claims itself
    8                          KLAMATH CLAIMS COMMITTEE     v. US
    A123 Sys., Inc. v. Hydro-Quebec, 
    626 F.3d 1213
    , 1221
    (Fed. Cir. 2010) (reviewing de novo a Rule 19 issue “in the
    first instance on appeal” based on facts in the record);
    Cultor Corp. v. A.E. Staley Mfg. Co., 
    224 F.3d 1328
    , 1332-
    33 (Fed. Cir. 2000) (affirming a district court’s denial of a
    motion to amend on the basis that any amendment would
    have been futile).
        Rule 19 explains that a party may be a “required” par-
    ty if it “claims an interest relating to the subject of the
    action and is so situated that the disposition of the action
    in [its] absence may . . . as a practical matter impair or
    impede [its] ability to protect that interest.” RCFC
    19(a)(1)(B). If joinder of a required party is not feasible,
    the Court of Federal Claims must determine if the absent
    party is an indispensable one without whom the action
    should not proceed. RCFC 19(b). That analysis generally
    turns on several factors specified in the rule, including
    “the extent to which a judgment rendered in the [required
    party’s] absence might prejudice that [party]”; “the extent
    to which any prejudice could be lessened or avoided”;
    “whether a judgment rendered in the [required party’s]
    absence would be adequate”; and “whether the plaintiff
    would have an adequate remedy if the action were dis-
    missed.” RCFC 19(b)(1)-(4).
        Applying those Rule 19 factors here, we hold that the
    Tribes is an indispensable party for the claims the KCC
    sought to add in its motion to amend. The Tribes is
    clearly a required party for those claims, and the first
    Rule 19 factor weighs quite heavily in favor of dismissal.
    required dismissal of the whole action. See, e.g., RCFC 19
    (“If a person who is required to be joined . . . cannot be
    joined, the court must determine whether . . . the action
    should proceed . . . or should be dismissed) (emphasis
    added); Molinos Valle Del Cibao, C. por A. v. Lama, 
    633 F.3d 1330
    , 1343 (11th Cir. 2011) (“If the party is indis-
    pensable, then we must dismiss the entire case.”).
    KLAMATH CLAIMS COMMITTEE    v. US                         9
    The resolution of the KCC’s new claims would necessarily
    implicate significant sovereign interests of the Tribes and
    risk substantial prejudice to it. As the Court of Federal
    Claims recognized, adjudication of claims by the KCC
    would require the court to resolve whether the KCC has
    standing. Klamath Claims Comm., 97 Fed. Cl. at 212.
    For the new claims, the standing inquiry would compel
    the court to determine which past and current members of
    the Tribes the KCC represents and whether the KCC has
    the authority to represent those individuals’ interest in
    the Litigation Fund. Those determinations would require
    the court to decide the extent of the KCC’s power and
    authority pursuant to, not only several acts of Congress,
    but also the legislative acts, laws, and constitution of the
    Tribes. Any such decision could have a significant preju-
    dicial effect on the Tribes’s sovereign power of self-
    governance and its ability to effectively protect its inter-
    ests—and its members’ interests—in the Litigation Fund.
        That risk of substantial prejudice has been made clear
    by events that transpired after the Court of Federal
    Claims issued its decision. In July 2012, the Tribes
    formally dissolved the KCC pursuant to its constitution
    and created a new committee to represent the 1954 Enrol-
    lees’ interests in the Litigation Fund (the “1954 Final
    Enrollees Committee”). Resp’t’s Addendum 12-14. 8 That
       8    The government appended to its brief pertinent
    resolutions of the Tribes’s government that were passed
    after the Court of Federal Claims issued its decision here.
    In its reply brief, the KCC moved to strike those docu-
    ments from the government’s brief and asked us not to
    take judicial notice of them. The KCC’s motion to strike
    is denied. We take judicial notice of the resolutions the
    government appended to its brief, which are publically
    available records of the Tribes’s government whose accu-
    racy cannot be reasonably questioned. See Massachusetts
    v. Westcott, 
    431 U.S. 322
    , 323 n.2 (1977) (explaining that
    government records may be “judicially noticed”); The
    10                         KLAMATH CLAIMS COMMITTEE    v. US
    new committee held an open meeting in August 2012 at
    which an almost unanimous number of the present 1954
    Enrollees (or their representative heirs) voted to distrib-
    ute all of the money in the Litigation Fund to themselves.
    Id. at 16. In November 2012, that vote was ratified by the
    Tribes, and the Tribal Council was directed to distribute
    the funds. Id.
        The KCC’s standing directly depends upon its author-
    ity to bring claims on behalf of the 1954 Enrollees that
    accord with the interests of those individuals. It is now
    apparent that the same sovereign that created the KCC
    has dissolved it and formed a new government committee
    to represent the interests of the 1954 Enrollees in the
    Litigation Fund. And, even though the 1954 Enrollees
    have voted to disburse all the monies in the Fund to
    themselves, the KCC demands as relief under its first new
    claim that proceeds from the Fund be paid to its attor-
    neys—not the 1954 Enrollees. 9 Thus, there are significant
    questions here regarding the KCC’s authority to bring its
    new claims and the true identity of the tribal members
    (and their interests) that the KCC represents. To deter-
    mine if the KCC has standing, the Court of Federal
    Claims would be forced to resolve those issues by, in large
    part, interpreting the Tribes’s laws and constitution.
    Such a decision could undoubtedly impinge upon the
    Tribes’s sovereignty and substantially prejudice its ability
    Klamath Tribes General Council Resolution #2012-003,
    available            at          http://www.klamathtr
    Fund.pdf; The Klamath Tribes General Council Resolu-
    tion #2012-002, available at http://www.klamathtribes
         9 The existence of competing claims to the same pot
    of money is a classic reason for dismissing under Rule 19
    when one of the claimants is not a party.
    KLAMATH CLAIMS COMMITTEE    v. US                        11
    to self-govern, regulate the activities of its agents under
    its laws, and protect the interests of the 1954 Enrollees in
    the Litigation Fund—which it appears to have historically
    done without objection by the KCC. 10 Thus, the first Rule
    19 factor overwhelmingly favors dismissal. Accord Repub-
    lic of Philippines v. Pimentel, 
    553 U.S. 851
    , 869 (2008)
    (finding error in a court’s analysis of the first Rule 19(b)
    factor by “not accord[ing] proper weight to the compelling
    claim of sovereign immunity”).
         The remaining Rule 19 factors also point to dismissal.
    Although the KCC might be able to obtain adequate relief
    in absence of the Tribes, there is no practical way for the
    court to lessen the potential prejudice to the Tribes by
    shaping the relief it grants or including protective provi-
    sions in its judgment. Furthermore, the KCC is not
    without remedy if its new claims are dismissed: it is free
    to seek a resolution or declaration under tribal law re-
    garding its right to represent the 1954 Enrollees and then
    refile its suit if successful.
       10    The KCC believes that it has authority to bring its
    claims solely pursuant to the Termination Act. But that
    view is overly simplistic and discounts the relevance of
    tribal law here. We cannot simply ignore that the sover-
    eign which created and empowered the KCC under its
    laws has now dissolved the KCC using that very same
    power and created a new government committee to repre-
    sent the interests of the 1954 Enrollees in the Litigation
    Fund. It seems axiomatic that the sovereign Tribes may
    choose which of its branches or agents can bring suit on
    its behalf to vindicate its rights or the rights of its mem-
    bers. If certain members of the Tribes disagree with that
    choice, they should seek relief in tribal court or through
    the Tribal Council. Federal courts are generally not the
    proper forum to settle such disputes, especially in absence
    of a relevant sovereign tribe. See Marceau v. Blackfeet
    Hous. Auth., 
    540 F.3d 916
    , 920-21 (9th Cir. 2008).
    12                        KLAMATH CLAIMS COMMITTEE    v. US
        Therefore, applying the standards of Rule 19 to the
    particular facts of this case, we conclude that the Tribes
    are clearly a required and an indispensable party to the
    claims the KCC sought to add in its motion to amend.
    Adjudicating those claims in the absence of the Tribes
    would be an abuse of discretion. Accordingly, we affirm
    the dismissal of the KCC’s motion to amend along with
    the Rule 19 dismissal of the third and fourth claims of the
    KCC’s amended complaint.