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Supreme Court on Tribal Sovereign Immunity: a Smelly Pot of Fish Head Stew

The SCOTUS opinion in Lewis v. Clarke is a narrow decision that could end up having a large effect on the full vitality of tribal sovereign immunity.

So, the Supreme Court has spoken; An employee of a Tribal Governmental Entity or Arm of the Tribe (Mohegan Gaming Authority) who is sued in State Court for injuries he caused in an off-reservation car accident, when sued in his individual capacity by an injured Plaintiff, is not entitled to the defense of tribal sovereign immunity simply because tribal law allows for the Tribe, or its entity or arm, to indemnify him for actions arising from his employment activities. He cannot claim that the Mohegan Tribe's Sovereign Immunity bars the State Court suit against him in his individual capacity.

Specifically, the Supreme Court said: We hold that, in a suit brought against a tribal employee in his individual capacity, the employee, not the tribe, is the real party in interest and the tribe’s sovereign immunity is not implicated. That an employee was acting within the scope of his employment at the time the tort was committed is not, on its own, sufficient to bar a suit against that employee on the basis of tribal sovereign immunity. We hold further that an indemnification provision does not extend a tribe’s sovereign immunity where it otherwise would not reach.Lewis et al. v. Clarke Certiorari to the Supreme Court of Connecticut.

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The SCOTUS opinion is a pretty narrow decision that does not immediately effect the full vitality of Tribal Sovereign Immunity under the Kiowa Principal that was upheld in the recent Bay Mills decision. However, it ultimately could, if the State Court enters a judgment saying the Mohegan Tribal Gaming Authority (even though it is not present in the case) must pay for the damage the employee did, and the State Court finds that the tribe waived its sovereign immunity under the tribe’s own Indemnification Law. How can the State Court do this in the absence of the tribe (Mohegan Tribal Gaming Authority)? The Connecticut State Supreme Court essentially told the plaintiff to take his case to Mohegan Tribal Court. Would the Connecticut State Supreme Court now uphold a judgment of the Connecticut Court, even in the absence of the tribe? Would the U.S. Supreme Court uphold the State Court decision that the tribe (Mohegan Tribal Gaming Authority) waived its immunity from State Court by way of the tribe’s Indemnification Law and that a State Court judgment ordering the tribe to pay is valid and enforceable? How would the plaintiff then collect on his State Court judgment? He still must go to the Tribal Court for enforcement if he seeks to be paid by the Mohegan Tribal Gaming Authority under the Mohegan Tribal Indemnification Law, unless the plaintiff can convince the State Court to seize tribal assets, such as bank accounts, to satisfy the judgment.

Theoretically at least, the State Court has no jurisdiction to subpoena the Mohegan Tribal Gaming Authority (tribe) into State Court. If the State Court Judgment is entered in the absence of the tribe (Tribal Gaming Authority), and in the face of a motion to dismiss for failure to join an indispensable party (The Tribal Gaming Authority), how does the State Court enforce its own judgment saying the tribal entity must pay? Should not the plaintiff be made to take his State Court Judgment and go to the Tribal Court for its enforcement against the Tribal Gaming Authority? One would think so. Should not the Tribal Court ultimately determine whether the judgment is valid and, in doing so, make its own Findings of Law regarding the Tribal Indemnification Law and its own Finding of Facts regarding whether the Employees conduct is, or is not, covered under the Tribal Indemnification Law? One would think so. The Connecticut Court could do as a Montana Court did recently, and allow seizure of tribal bank accounts to satisfy a State Court judgment.

The Supreme Court has stirred a smelly pot of Fish Head Stew and will not be able to put the lid back on the boiling over pot. (Apologies to Yakima relatives.) It does not bode well for the tribes for the Supreme Court to “tinker” with the Doctrine of Tribal Sovereign Immunity which predates the Federal and State Sovereign Immunity to which the SCOTUS analogized in making its decision. And, this decision is not consistent with its Bay Mills decision whereby the Supreme Court said that the tribe’s actions off the reservation, in the conduct of commercial activity, did not waive its immunity from State Court actions. In dictum, that Supreme Court panel advised the State to go after individual tribal employees who were running the tribe’s commercial activity (off reservation gaming) as the court advised they would not be entitled to the protection of Tribal Sovereign Immunity for activities off the reservation that violated State Law. As one of my colleagues put it “the Supreme Court has called the tribes’ bluff” made in winning the Bay Mills decision and the court’s hand trumps the tribes heretofore winning hand.

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Tribal Employees are now at risk for their conduct in carrying out their scope of duties under tribal employment off the reservation, that coincidentally amounts to a compensable injury under State Law. Theoretically, if the employee’s duties to the tribal employer, coincidentally, amount to a violation of State Criminal Law, could he be arrested? What other activities that Tribal Employees and Officers conduct off the reservation may violate State Law? What about internet transactions conducted by Tribal Employees on the Reservation that supposedly violate the State Law at the other end of the Internet transaction? What happens with the whole “prohibitory versus permitted but regulated” analysis of Cabazon?

The SCOTUS did not rule as to whether the Mohegan Tribe's Indemnification Statute entitles the plaintiff to recover from the Tribal Entity under the tribal indemnification clause and made no opinion as to whether the Tribal Indemnification Statute acts as a waiver of tribal sovereign immunity as the question was not before the SCOTUS. Further, SCOTUS noted that the Tribal Indemnification Statute allows the tribe to refuse indemnification under certain circumstances in relation to the employees conduct that would potentially be outside the scope of his employment. The question, of whether his conduct was "inside or outside the scope of his employment or outside the boundaries of conduct the tribe has determined it will indemnify,” could only properly be answered by the Mohegan Tribal Gaming Authority (as a factual finding by the administrative body responsible for interpreting the Tribal Indemnification Law) and/or the Mohegan Gaming Disputes Court and/or the Mohegan Tribal Court.

The ultimate answer will/should come from the Tribal Jurisdiction, and not from a State Court. Even if the State Court makes such a factual finding (without the presence of the Mohegan Tribe or its entity in the State Court action), and the State Court enters a judgment that supposedly entitles the plaintiff to recover from the employee's employer (Mohegan Tribal Gaming Authority) under the tribes' Indemnification Law, that judgment would have to be taken into Tribal Court for enforcement. Such enforcement would be against the Tribal Entity that was not joined in the State Court action. The Tribe (Tribal Gaming Authority) could contest the judgment on several grounds in Tribal Court, not the least of which would be the State Court’s lack of jurisdiction over the Tribal Gaming Authority. One would think that in the interest of judicial economy the State Court should have told the plaintiff to take his case to Tribal Court. But, that was not the State of Connecticut’s goal here. What they wanted to do was take a bite out of Tribal Sovereign Immunity, and have successfully done so. To what end?

The ultimate payer under the Tribal Indemnification Statute is the Tribal Gaming Authority over which the State Court wielded no authority (jurisdiction). If the State Court judgment is brought to the Tribal Court for enforcement, the Tribal Court, under notions of comity (absent a tribal law giving full faith and credit to State Court judgements), could decline to enforce the judgement and engage in its own factual finding as to whether the actions of the employee were, in fact, actions that would disqualify the employee, because his actions were outside the scope of his employment or outside the scope of coverage in the Tribal Indemnification Law, from being indemnified. How does that serve judicial economy? It doesn’t.

So, did the Supreme Court think of the practical and logistical consequences of its decision? I seriously doubt it. Should the State Court consider these matters on remand? One would hope so. What court would want to enter a judgment that supposedly would be paid by the tribe (Tribal Gaming Authority) over whom it has no jurisdiction and the tribe not being a party in the State Court action? I supposed it could do so noting that the plaintiff must take his judgment to the Tribal Court for enforcement. What it really should do is tell the plaintiff to take his case to Tribal Court. That’s what a responsible court might do. As the Brief of Respondent (Employee) points out the plaintiff “could have and should have taken his claim to Tribal Court.” It will probably end up there, if he ever expects to collect.

Harold Monteau is a Chippewa Cree Attorney and former Federal Court of Indian Offenses Judge writing from New Mexico. He can be reached at hamlaw@live.com