NAVAJO NATION; NORTHERN EDGE NAVAJO CASINO, Plaintiffs-Appellants,
v.
The Honorable BRADFORD J. DALLEY, District Judge, Eleventh Judicial District, New Mexico, in his official capacity; HAROLD MCNEAL; MICHELLE MCNEAL, Defendants-Appellees, NEW MEXICO TRIAL LAWYERS ASSOCIATION; PUEBLO OF SANTA ANA, Amici Curiae.
Appeal
from the United States District Court for the District of New
Mexico (D.C. No. 1:15-CV-00799-MV-KK)
Patrick T. Mason, Mason & Isaacson, P.A., Gallup, New
Mexico, for Plaintiffs-Appellants.
Nicholas M. Sydow, Office of the New Mexico Attorney General,
Santa Fe, New Mexico, for Defendant-Appellee Bradford J.
Dalley.
Daniel
M. Rosenfelt, Rios Law Firm, Albuquerque, New Mexico (Linda
J. Rios, Rios Law Firm, Albuquerque, New Mexico, with him on
the brief), for Defendants-Appellees Harold McNeal and
Michelle McNeal.
Michael B. Browde, Albuquerque, New Mexico (David J. Stout,
Albuquerque, New Mexico, with him on the brief), for Amicus
Curiae New Mexico Trial Lawyers Association, in support of
Defendants-Appellees.
Richard W. Hughes, Rothstein, Donatelli, Hughes, Dahlstrom,
Schoenburg & Bienvenu, LLP, Santa Fe, New Mexico (Donna
M. Connolly, Rothstein, Donatelli, Hughes, Dahlstrom,
Schoenburg & Bienvenu, LLP, Santa Fe, New Mexico, with
him on the brief), for Amicus Curiae Pueblo of Santa Ana, in
support of Plaintiffs-Appellants.
Before
HOLMES, PHILLIPS, and MORITZ, Circuit Judges.
HOLMES, CIRCUIT JUDGE.
The
Appellants, the Navajo Nation and its wholly-owned government
enterprise the Northern Edge Navajo Casino (together, the
"Tribe" or "Nation"), entered into a
state-tribal gaming compact with New Mexico under the Indian
Gaming Regulatory Act ("IGRA"), 25 U.S.C.
§§ 2701-2721. The Tribe agreed not only to waive
its sovereign immunity for personal-injury lawsuits brought
by visitors to its on-reservation gaming facilities, but also
to permit state courts to take jurisdiction over such claims.
Harold and Michelle McNeal (the "McNeals") are
plaintiffs in just such a state-court action against the
Tribe. Mr. McNeal allegedly slipped on a wet floor in the
Northern Edge Navajo Casino. This slip-and-fall incident
constituted the basis for the McNeals' tort claims
against the Nation for negligence, res ipsa loquitur, and
loss of consortium. Judge Bradford Dalley is a New Mexico
state judge who presides over the ongoing state-court
proceedings. We refer to the McNeals and Judge Dalley
collectively as the Appellees.
The
Tribe moved to dismiss the McNeals' complaint, arguing
that the state court lacked jurisdiction because neither IGRA
nor Navajo law permits the shifting of jurisdiction to a
state court over such personal-injury claims. The state court
rejected that motion. In response, the Tribe sought
declaratory relief in federal court on the basis of the same
arguments. The district court granted summary judgment for
the McNeals and Judge Dalley, holding that IGRA permitted
tribes and states to agree to shift jurisdiction to the state
courts and that Navajo law did not prohibit such an
allocation of jurisdiction. The Tribe timely appealed. Prior
to oral argument, we ordered the parties to submit
supplemental briefs as to whether the district court had
jurisdiction.
Along
with the jurisdictional issue, the parties also dispute (1)
whether IGRA permits an Indian tribe to allocate jurisdiction
over a tort claim arising on Indian land to a state court,
and (2) assuming that IGRA does allow for such an allocation,
whether the Navajo Nation Council ("NNC") was
empowered to shift jurisdiction to the state court under
Navajo Law.
After
first concluding that we have jurisdiction to hear this
appeal, we determine that IGRA, under its plain terms, does
not authorize an allocation of jurisdiction over tort claims
of the kind at issue here. Accordingly, we
reverse the judgment of the district court
and remand with instructions to grant the
declaratory relief sought by the Nation.
I
A
In
1987, the Supreme Court decided California v. Cabazon
Band of Mission Indians, in which it held that states
could not regulate gaming activities on Indian land without
Congressional authorization. 480 U.S. 202, 207 (1987)
(rejecting California's attempted regulation of bingo and
some card games), superseded by statute, Indian
Gaming Regulatory Act, 25 U.S.C. §§ 2701-2721,
as recognized in Michigan v. Bay Mills Indian Cmty.,
__U.S.__, 134 S.Ct. 2024 (2014); see New Mexico v.
Dep't of Interior ("N.M./DOI"),
854 F.3d 1207, 1211 (10th Cir. 2017) ("In 1987, the
Supreme Court [in Cabazon] held that states lack
regulatory authority over gaming activities on Indian land
except where Congress has expressly provided for such
authority."); Kevin K. Washburn, Recurring Problems
in Indian Gaming, 1 Wyo. L. Rev. 427, 428 (2001)
("The [Cabazon] Court held that although
Congress may have given to the State of California criminal
jurisdiction within Indian reservations, Congress had not
given the state the lesser power of civil regulatory
jurisdiction on reservations.").
In
response to that "bombshell" ruling, Franklin
Ducheneaux, The Indian Gaming Regulatory Act: Background
and Legislative History, 42 Ariz. St. L.J. 99, 154
(2010), Congress enacted IGRA in 1988 to create a framework
for states and Indian tribes to cooperate in regulating
on-reservation tribal gaming, see Pueblo of Pojoaque v.
New Mexico, 863 F.3d 1226, 1232 (10th Cir. 2017)
("In response to the Supreme Court's holding in
[Cabazon], that states lack regulatory authority
over Indian gaming on tribal lands absent congressional
action, Congress enacted IGRA, 25 U.S.C. §§
2701-2721, to provide a role for states in regulating Indian
gaming activities on tribal lands."); see also Bay
Mills, 134 S.Ct. at 2034 ("Everything-literally
everything-in IGRA affords tools (for either state or federal
officials) to regulate gaming on Indian lands, and nowhere
else."); N.M./DOI, 854 F.3d at 1212 (noting
that IGRA "gives states a role in the regulation of
Indian gaming"); Cohen's Handbook of Federal Indian
Law § 12.01, at 876 (Nell Jessup Newton ed., 2012)
[hereinafter, "Cohen's Handbook"] ("IGRA
accommodated the interests of tribes in pursuing gaming but
also set forth a federal regulatory regime, and gave a
powerful role to states by providing for significant state
involvement in the decision to permit casino-style
gaming."). IGRA enables states and tribes to negotiate
compacts addressing a range of topics relating to tribal
gaming. See 25 U.S.C. § 2710(d).
Under
IGRA, tribes that seek to conduct gaming activities are
incentivized to negotiate gaming compacts with states
because, absent such compacts, the most "lucrative"
form of gaming-Class III gaming-is forbidden.
N.M./DOI, 854 F.3d at 1212 ("The present case
concerns Class III gaming, which includes the most lucrative
forms of gaming."); see § 2710(d)(1);
Bay Mills, 134 S.Ct. at 2035 ("[A] tribe cannot
conduct class III gaming on its lands without a compact . . .
."); Seminole Tribe of Fla. v. Florida, 517
U.S. 44, 47 (1996) ("The Indian Gaming Regulatory Act
provides that an Indian tribe may conduct certain gaming
activities only in conformance with a valid compact between
the tribe and the State in which the gaming activities are
located."). "Class III gaming . . . includes casino
games, slot machines, and horse racing." Bay
Mills, 134 S.Ct. at 2028; see Washburn,
supra, at 429 ("IGRA provides that tribes may
engage in Class III casino-style gaming only if they first
negotiate 'compacts' with
states.").[1]
Importantly, IGRA expressly prescribes the matters that are
permissible subjects of gaming-compact negotiations between
tribes and states. § 2710(d)(3)(C). In the tribal-state
compact that the Tribe and New Mexico entered into, the Tribe
agrees not only to waive its sovereign immunity as to
personal-injury claims brought by visitors to its casinos but
also to permit such claims to be brought in state court.
See Aplt.'s App. at 26 (State-Tribal Compact,
dated Nov. 6, 2003).[2] More specifically, the compact permits
such state-court litigation, "unless it is finally
determined by a state or federal court that IGRA does not
permit the shifting of jurisdiction over visitors'
personal injury suits to state court." Id.
B
The
present dispute has its genesis in a slip-and-fall case that
the McNeals brought in New Mexico state court. Mr. McNeal
allegedly fell on a wet bathroom floor in the Navajo Northern
Edge Casino. He and his wife sued the Nation, which owns and
operates the casino, claiming negligent maintenance, res ipsa
loquitur, and loss of consortium. In a motion to dismiss, the
Tribe argued that the state court lacked subject-matter
jurisdiction for two reasons. First, it contended that this
was so because IGRA does not authorize states and tribes to
enter into compacts that shift jurisdiction over tort claims
stemming from events on Indian country to state
court-viz., IGRA does not contemplate that the
shifting of jurisdiction over such claims is a permissible
subject of compact negotiations. Second, it argued that NNC
was not authorized to shift jurisdiction over tort claims
against the Nation, like those of the McNeals, to state
court.
The
state court denied the Tribe's motion to dismiss on the
basis that the New Mexico Supreme Court, in Doe v. Santa
Clara Pueblo, had already decided the issue. 154 P.3d
644, 646 (N.M. 2007) ("We now . . . hold[] that state
courts have jurisdiction over personal injury actions filed
against [the tribes] arising from negligent acts alleged
against casinos owned and operated by the [tribes] and
occurring on the [tribes'] lands."). Subsequently,
Judge Dalley took over the state court case.
The
Tribe then brought this suit for a declaratory judgment in
the U.S. District Court for the District of New Mexico. The
Tribe sought a declaratory judgment "that [the] Indian
Gaming Regulatory Act does not permit the shifting of
jurisdiction from tribal courts to state courts over personal
injury lawsuits brought against tribes or tribal gaming
enterprises, and that the New Mexico state courts do not have
jurisdiction over lawsuits such as the McNeal
Lawsuit." Aplt.'s App. at 11-12. (Am. Compl.,
dated Sept. 21, 2015).
The
Tribe moved for summary judgment, and the district court
denied relief. The court first addressed whether the Nation
inherently had the authority to permit state court
jurisdiction over claims arising in Indian country, and held
that it did. It then concluded that NNC was authorized under
Navajo law to shift jurisdiction over tort claims against the
Nation, like those of the McNeals, to state court. Lastly,
the court addressed the IGRA question, holding that IGRA
authorized such shifting of jurisdiction as to
personal-injury tort claims either under 25 U.S.C. §
2710(d)(3)(C)(i) and (ii), when read together; or under the
catch-all provision, § 2710(d)(3)(C)(vii). Concluding
thereafter that "there [were] no legal issues remaining
to be resolved," the district court dismissed the case.
Id. at 163 (Mem. Op. & Order, dated Aug. 3,
2016). The Tribe timely appealed from the district
court's judgment.
II
We
first address our jurisdiction. Because federal courts have
limited subject-matter jurisdiction, "we 'may only
hear cases when empowered to do so by the Constitution or by
act of Congress.'" Gad v. Kan. State Univ.,
787 F.3d 1032, 1035 (10th Cir. 2015) (quoting Radil v.
Sanborn W. Camps, Inc., 384 F.3d 1220, 1225 (10th Cir.
2004)). "[W]e always have an independent obligation-no
matter the stage of litigation-to consider whether a case
creates a live case or controversy and belongs in federal
court." Id.; accord Arbaugh v. Y&H
Corp., 546 U.S. 500, 514 (2006). We review de novo
whether subject-matter jurisdiction is proper. See,
e.g., 1mage Software, Inc. v. Reynolds &
Reynolds Co., 459 F.3d 1044, 1048 (10th Cir. 2006);
Austl. Gold, Inc. v. Hatfield, 436 F.3d 1228, 1234
(10th Cir. 2006).
Consistent
with our independent obligation, we ordered the parties to
submit briefing regarding, inter alia, whether,
under 28 U.S.C. § 1331, the district court had federal
jurisdiction over this action when the Tribe was raising what
(at first blush) appeared to be federal defenses to pure
state-law claims. Since this briefing, that jurisdictional
issue has been resolved by a panel of our court in Ute
Indian Tribe v. Lawrence, 875 F.3d 539 (10th Cir. 2017),
which ruled that federal courts do have jurisdiction in
circumstances like those presented here.
Specifically,
in Lawrence, a non-Indian brought a
breach-of-contract claim against the Ute Indian tribe in Utah
state court. Seeking to halt the state proceeding, the Tribe
filed suit in federal district court, "asserting . . .
that the state court lacked subject-matter jurisdiction to
hear the case." Id. at 540. The district court,
in turn, determined that it did not have jurisdiction to
consider the Tribe's challenge to the state court's
jurisdiction. Id. The Tribe appealed, and we
reversed the district court's determination, holding that
the Ute Tribe's "claim-that federal law precludes
state-court jurisdiction over a claim against Indians arising
on the reservation-presents a federal question that sustains
federal jurisdiction." Id.
In
reaching that conclusion, the panel first analyzed the
"long history of federal law regarding Indian
affairs," id. at 541, and observed both that
"federal law regulates a tribe's right to exercise
jurisdiction over non-Indians," id. at 542, and
"that state adjudicative authority over Indians for
on-reservation conduct is greatly limited by federal
law," id. From those principles, we determined
that "federal courts generally have jurisdiction to
enjoin the exercise of state regulatory authority (which
includes judicial action) contrary to federal law,"
id. at 543, and reasoned that the tribe's suit
arose under federal law because it was "seeking
injunctive and declaratory relief against state regulation
(the state-court proceeding) that it claims is preempted by
federal law," id. at 547.
Lawrence's
analysis is directly applicable here: the Nation here seeks
declaratory relief under federal law against state
regulation, viz., the state-court proceeding,
claiming that federal law preempts it. As such, we properly
exercise jurisdiction over this appeal under §
1331.[3]
III
Proceeding
to the merits, this appeal presents two issues, one of
federal law and one of Navajo law. First, the Nation asserts
that the district court erred in concluding that IGRA
authorizes an Indian tribe to allocate jurisdiction over a
tort claim arising on Indian land to a state court. Second,
even assuming that IGRA does allow a tribe to allocate
jurisdiction of such claims to state courts, the Nation
submits that the NNC was not empowered to shift jurisdiction
to the state ...