Tuesday, July 10, 2012

The Gun Lake Decision: What Does it Mean for Indian Gaming?

By Dennis J. Whittlesey

By this time, everyone with an interest in gaming, is aware of the recent U.S. Supreme Court decision rendered in the case of Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians v. Patchak. The Tribe is commonly known as the “Gun Lake Band”. That said, many people still do not understand what the Court’s ruling means to Indian gaming and this article will attempt to identify – and respond to – the questions that may remain.

At the outset, it has to be said that the Patchak win was a tribute to skillful pleading by his attorneys, who carefully avoided invoking the federal Quiet Title Act (“QTA”) which has proven to be quicksand for many challengers to decisions by the Interior Secretary to take land into trust for tribes.

Even the slightest encroachment into the zone of “property interest” in such a challenge negates the waiver of federal sovereign immunity established by the Administrative Procedure Act (“APA”) to allow private parties to challenge a federal agency action. The Patchak lawyers understood the puzzle and carefully crafted their claims of interest to avoid the QTA altogether. That single achievement may prove to be one of the lasting legacies of the entire Gun Lake case.

The sole statutory authority pursuant to which the Secretary of the Interior can take land into trust for tribes is found in 25 W.S.C. 465, which is part of the Indian Reorganization Act of June 18, 1934 (“IRA”). In early 2009, the Supreme Court in the well-known Carcieri case ruled that the trust acceptance authority could only be exercised on behalf of tribes that were “under federal jurisdiction” on the date of IRA enactment. This ruling was a shock since the assumption (and even prior judicial determinations) was that the authority extended to all currently recognized tribes, without any regard of tribal status in 1934.

By remanding the Gun Lake case to the federal district court, the Supreme Court has given Patchak an opportunity to litigate the issue of whether the tribe was “under federal jurisdiction” when the IRA became law. The Carcieri Court did not define the term and it is widely misunderstood. While it is unknown whether Patchak  can prove that the Gun Lake Band was not “under federal jurisdiction” at the critical date, the certainty is that this is an unresolved issue; indeed, nobody really knows what the term means.

What is known is that the decision almost certainly opens the door to what will be many legal challenges to trust acceptances. Moreover, these cases will be prosecuted pursuant to the APA, a factor which really complicates the tribal situation since the APA provides a six year period of time for filing legal challenges. With the new six-year challenge period defined, the landscape for development on new trust lands has shifted, and this could have profound impact on Indian casino projects since opponents could potentially delay development merely by announcing that legal challenges will be filed. If tribes proceed with development in the face of this threat, they run the risk of ultimately having their lands taken out of trust, which the Patchak Court noted was the ultimate issue confronting the parties.

To learn more about the impact of the Supreme Court’s decision, read the full article in the latest edition of Gaming Legal News.