WASHINGTON - Supreme Court Justice Samuel Alito, hearing oral arguments in the first Indian law case to come before the court since his confirmation, sought the certainty of a so-called ;'bright-line rule'' on legal jurisdiction concerning commerce in Indian country, a reference to legal principles so settled and clear that ordinary people can plan and conduct business in light of them. Attorney David C. Frederick responded by arguing for ''very fine gradations in the facts'' of Plains Commerce Bank v. Long Family Land and Cattle Company, Inc., et al., rather than the articulation of an overarching rule.
Among those facts, as set forth in part by an American Bar Association preview available at the Supreme Court press office, are that the Long Family Land and Cattle Co. was an Indian-owned business on fee land (i.e., land not held in trust for the tribe by the federal government, but privately owned) within the Cheyenne River Sioux reservation in South Dakota. Plains Commerce, an off-reservation bank, extended Long a loan on the strength of a BIA loan guarantee. Ultimately the bank obtained deed to the land in return for debt cancellation and the promise of future loans for operating capital, as well as a provision for the Long company to repurchase its land from the bank by settling its remaining debt to the bank.
But the 1996 negotiated arrangement offered no current operating capital, only the prospect of future operational loans, the Long company alleging in tribal court that the bank offered a 20-year mortgage loan initially but withdrew it over jurisdictional concerns. (A mortgage loan, of course, would have made operating cash available against the land as collateral.) Operational loans did not materialize in the winter of 1996 - 97, when the company lost most of its cattle herd. The bank moved to sell the Long lands and evict the family company, which turned to tribal court. A jury awarded Long Family Land and Cattle Co. $750,000 and interest on a contract claim.
On appeal in lower courts, Plains Commerce Bank lost its case that a tribal court has no jurisdiction over non-member commercial activity absent ''express consent'' of the non-members. The lower courts found an ''implied consent'' on the Supreme Court precedent of Montana v. United States from 1981, establishing two exceptions to the general rule that tribes lack jurisdiction over non-Indians on tribal lands.
''The first exception, most relevant here, is that a tribe may exercise jurisdiction over a non-member that engages in on-reservation consensual commercial relations with the tribe or its members.''
The Supreme Court accepted the case for review, raising concern throughout Indian country that the high court could seek ''bright-line'' legal certainty that would exclude tribal civil jurisdiction over non-tribal members.
Alito said little to allay those concerns during the oral arguments of April 14. Other justices pursued other angles, but several seemed to be angling for principles of law to apply with greater certainty to commercial relationships within tribal jurisdictions, and they appeared to struggle. Justice Antonin Scalia exemplified the division possible between the ''bright line'' and ''fine gradations'' schools of thought in two reactions, one aimed at Plains Commerce attorney Paul Banker and the other at Frederick for the Long company.
Scalia, reputedly an archconservative, lit up at least a few Indian law advocates in the court by telling Banker the BIA loan guarantee ''does give the whole thing a decided flavor of dealing with Indians on the reservation. ... It smells like dealing with Indians on the reservation to me.''
He followed with a line of questioning that led Banker to confirm that Commerce Bank could have gained ''the certainty that you're asking'' through a ''choice of law'' clause - that is, by including in its contract with the Long company a provision identifying the court of jurisdiction where any legal claims would be settled, for instance South Dakota state court. Instead, the bank settled for tribal court jurisdiction.
''In the absence of that [choice of law clause],'' Scalia continued, ''why should we bend over backwards to give something that has the smell of dealing with the Indians any other name?''
But as Frederick faced the firing line of pointed questions, he and Scalia engaged in a somewhat tangled exchange over the use of federal law in tribal court. Scalia ended up proclaiming that he was less impressed than he had been by Frederick's reliance on federal rules, since they seemed to mean whatever tribal court wanted them to mean.
Chief Justice John Roberts provided a final caution to any certainty that the high court has found its way to favoring the Long company and, by extension, tribal jurisdictional authority. In hypothetical questioning that featured some good laughs along the way - it turns out ''an Italian corporation'' formed by Justices Scalia and Alito would hope for federal loan guarantees - Roberts said that he simply doesn't understand the concept of an ''Indian corporation,'' at least not when the corporation is presented as a member of the tribe. His point, never stated so straightforwardly, appeared to be that if an Indian corporation isn't a readily comprehensible concept, banks can't necessarily be expected to understand it going in.
Frederick based his defense on ''further facts'' in the case, citing the many instances that suggest the bank knew itself to be ''engaging in a consensual relationship with Indians because it went on tribal trust lands. It involves the officers of the tribe for effectuating the loan.''
That is when Alito weighed in with his reminder that commercial jurisdiction is usually predicated on a ''bright-line rule,'' though not before he had acknowledged that many facts in the case favor the Long company.
The U.S. Department of Justice argued the case on the side of Long Family Land and Cattle Co.