‘A lot of questions’ in potential Remington Arms sale to Navajo Nation

In this Jan. 17, 2013, photo, a flag hangs at Remington Arms Company, in Ilion, N.Y. (AP Photo/Mike Groll, File)

Mary Annette Pember

Corrected A sale to a tribal nation seemed like a perfect fit — until a risk assessment reported otherwise

Mary Annette Pember
Indian Country Today

The Navajo Nation seemed to be the answer to Remington Arms' legal problems. The venerable arms maker is over 200 years old but has been struggling under the weight of lawsuits relating to the manufacture of AR-15 style automatic weapons, typically the gun of choice for perpetrators of mass shootings. Bankruptcy and subsequent sale to a sovereign immune entity, such as a tribal nation, however, seemed like a good move.

The Wall Street Journal recently reported that the Navajo Nation is once again in talks to buy the beleaguered company.

Such a sale is fraught with tragedy and irony — as well as a financial risk that may not be entirely mitigated by sovereign immunity.

The nation unsuccessfully tried to purchase Remington Arms in 2018 when the company filed for Chapter 11 but instead transferred ownership to creditors including Franklin Resources Inc. and JPMorgan Chase and Company.

Family members of nine people who were killed in the 2012 Sandy Hook massacre have successfully brought a lawsuit against Remington Arms in Connecticut state court. The shooter used a Remington-made Bushmaster military style rifle to kill 26 people at the Connecticut school, 20 of whom were first graders.

FILE - In this Jan. 17, 2013, file photo, a man walks past the Remington Arms Company in Ilion, N.Y. The Ithaca Journal reports that the CEO Ken D'Arcy, wrote a letter Monday, March 23, 2020 to Governor Andrew Cuomo and President Donald Trump, offering "approximately one million square feet of unused and available manufacturing space" at the Ilion plant for the manufacturing of hospital supplies in New York. (AP Photo/Mike Groll)
In this Jan. 17, 2013, photo, a man walks past the Remington Arms Company in Ilion, N.Y. (AP Photo/Mike Groll, File)

Typically firearms manufacturers are shielded from victim lawsuits via the 2005 federal Protection of Lawful Commerce in Arms Act. The Connecticut Supreme Court, however, is allowing the suit to move forward based on a law regarding the sale or marketing of firearms; the U.S. Supreme Court has declined to review Connecticut’s decision.

Remington Arms is once again pursuing bankruptcy; a benefit of this process often includes protection from current lawsuits.

“Liability is a huge concern related to the Sandy Hook lawsuit against Remington Arms. I imagine there’s a way in which, through the bankruptcy process, those liabilities could be mitigated,” said Carl Slater, Navajo Nation council delegate.

Stacy Leeds, citizen of the Cherokee Nation and Emeritus professor of law at the University of Arkansas agrees. “There is likely to be language in the bankruptcy and in the acquisition of the company that addresses taking on prior liabilities,” she said.

Normally tribal immunity would also shield the nation from future litigation.

According to an internal document shared anonymously with Indian Country Today, however, Remington Arms has significant liabilities that could negatively impact the Navajo Nation. Unless a claim of sovereign immunity is specifically stated in the acquisition agreement, the nation might still have to submit to state and federal bankruptcy courts nor could the nation avoid federal gun permit requirements.

Firearms manufacturing and sales are highly regulated by both state and federal governments; some of Remington Arms current firearm and ammunition licenses might not be easily transferable to the nation.

In addition to the Sandy Hook lawsuit, there are several product liability suits pending against Remington Arms that might easily overwhelm its liability insurance coverage.

Buyers of Remington Arms may also be liable for environmental risks incurred by the manufacturing of its products both past and present that might not withstand claims of sovereign immunity.

Authors of the document strongly advise the nation to employ due diligence including performing a more rigorous risk assessment and ensuring that any tribal entity created to acquire Remington Arms also shares the tribe’s sovereign immunity before moving forward with the acquisition.

Members of the Navajo Nation Council’s Budget and Finance Committee voted Tuesday to remove the legislation relating to the purchase of Remington Arms from their meeting agenda. There was no discussion of moving forward with due diligence.

A sign for Navajo Drive is seen against a cloud-darkened Sentinel Mesa in Oljato-Monument Valley, Utah on the Navajo Reservation on April 30, 2020. The reservation has some of the highest rates of coronavirus in the country. If Navajos are susceptible to the virus' spread in part because they are so closely knit, that's also how many believe they will beat it. (AP Photo/Carolyn Kaster)
A sign for Navajo Drive is seen against a cloud-darkened Sentinel Mesa in Oljato-Monument Valley, Utah, on the Navajo Reservation on April 30. (AP Photo/Carolyn Kaster, File)

Like the 2018 proposed sale, the process seems to lack transparency as members of the Nation’s Investment Committee earlier approved the most recent resolution recommending purchase of the company.

The Navajo Times reports that although investment committee meetings are public, they are not well-publicized. The committee published legislation no. 0133-20 on the nation’s website on June 20 for public comment on a proposed $300 million direct investment in the company. The company, however, was not named then nor in today’s committee meeting.

The resolution reads: “Negotiations concerning the Company are covered by a non-disclosure agreement and cannot be distributed to the public and/or anyone not covered in the non-disclosure agreement.”

“We have an investment committee that is governed by statute; they vote on investments and that in some cases moves on to the Budget and Finance Committee where the process should be more transparent. Information shared in executive session needs to remain intact because non disclosure agreements were signed,” Slater said.

The Navajo Nation recently agreed to negotiate limited waivers of its sovereign immunity with the states of Wyoming and Montana relating to its Navajo Transitional Energy Company. The states insisted on the waiver in order to allow the Company to operate new mines in both states.

The nation created Navajo Transitional Energy in 2013 after purchasing Navajo Mine and the Four Corners Power Plant. Many members of the community opposed the acquisition out of concern for liability issues and the environment. In 2019, Navajo Transitional Energy purchased  additional coal mines in Wyoming and Montana; a report by the Institute for Energy Economics and Financial Analysis described these acquisitions as “fraught with financial risk.”

The Energy Company announced last month that it is partnering with a solar power company that it hopes will generate around $20 million in tax revenue for the nation over the span of 40 years.

According to Slater, support from the Navajo Nation community for the Remington Arms purchase is also mixed.

“Unfortunately, the history of economic enterprises on the Navajo Nation, however, have been very mixed therefore our citizens view this investment with skepticism especially since much of the negotiations have taken place behind closed doors,” Slater said.

When asked if acquiring an arms manufacturer aligns with Navajo values he said, “Engaging with capitalism, in principle, doesn’t really align with traditional Navajo values; it’s not an excuse to set aside all of our traditional values and fundamental law.”

“Navajo people use guns to continue our traditional way of life such as hunting and as personal protection against predators when sheepherding,” Slater said.

The relationship between Native Americans and guns is as old as America. Historically dependent upon hunting for survival, guns have held special interest for Native peoples since the colonial era.

Fearful of empowering Native peoples, however, European settlers such as the colonists in 17th century Virginia enacted laws making providing guns or ammunition to Natives punishable by death. Federal law regulated gun sales to Native Americans until 1978 when the law requiring them to prove lawful intent for gun purchases was reversed. If the Remington Arms sale to the Navajo Nation eventually goes through, it would represent a symbolic sea change in the standing of Native Americans in the U.S. as well as a bold statement of tribal sovereignty.

On the surface, the gun business is lucrative. Sales have skyrocketed due to fears over the pandemic and civil unrest. According to the New York Times, Americans bought around 2 million guns in March, making it the second highest month ever for gun sales. January 2013, after President Barack Obama’s re-election and the Sandy Hook shooting, was the highest month for gun sales.

Does tribal acquisition of a fraught company such as Remington Arms lead to accusations of sovereign immunity shopping?

“I think it’s unfair and unjust to accuse tribal governments of selling their sovereign immunity. State, local and federal governments all have sovereign immunity and all choose how and when to waive it. I don’t like the sensationalizing of economic activity by tribal governments as having unfair advantages,” said Angelique EagleWoman, Sisseton-Wahpeton Dakota Oyate and professor co-director of the Indian Law Program at Mitchell Hamline School of Law in St. Paul, Minnesota.

“Responsible manufacturing of guns is a cultural match for tribal governments,” EagleWoman said.

Gun laws on the Navajo reservation, which spreads across Arizona, New Mexico and Utah, are stricter than states surrounding it. According to Refinery29 which lists current states’ gun laws, Arizona, which hosts the largest area of the reservation, allows concealed and open carry of firearms without permits. New Mexico and Utah both allow open carry but have “shall issue” requirements for carrying concealed weapons. In “shall issue” states, authorities have some discretion in issuing permits to convicted felons or people with mental competency issues.

According to Angelia Riley, professor of law and director at the Native Nations Land Policy Center at the UCLA School of Law, "Indian nations are pre-constitutional.”

“Tribal sovereignty predated the formation of the United States, and tribes were not parties to the Constitutional Convention. Thus, though Indian tribes are mentioned in the Constitution, they were never formally brought within its scope,” Riley said. “As a result, the Bill of Rights  including the Second Amendment  is inapplicable to Indian tribal governments. And the

Indian Civil Rights Act, which extended some portions of the Bill of Rights to Indian tribes did not contain a Second Amendment corollary."

The Navajo Nation forbids carrying a loaded gun except for hunting or if the weapon is used for lawful protection of property and kept in the glove compartment of a car or in one's home. The nation’s law and order code also permits use of guns as integral parts of any traditional Navajo religious practice.

For the time being, the future of the Remington Arms acquisition is unclear both for members of the Budget and Finance Committee as well as citizens of the Navajo Nation.

Davina Tallman Harrison, Navajo, expressed concern about the overall lack of transparency surrounding the purchase as well as strategy for benefiting the Nation while protecting it from liability.

Harrison wondered if the nation’s citizens would have heard anything about the legislation were it not for media reports.

“I’ve got a lot of questions,” she said.

This story has been updated to correct the scope of the Institute for Energy Economics and Financial Analysis report. The Institute's report included analysis of Navajo Transitional Energy's 2019 acquisition of coal mines in Montana and Wyoming, not the creation of the Navajo Transitional Energy company in 2013. 

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Mary Annette Pember, a citizen of the Red Cliff Ojibwe tribe, is a national correspondent for Indian Country Today.

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