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Compromised Immunity

By Megan Kinneyn | Nov. 2, 2006

Law Office Management

Nov. 2, 2006

Compromised Immunity

The doctrine of sovereign immunity isn't what it used to be for Indian tribes. By Peter Byrne

By Peter Byrne
      Indian tribes feel the erosion of the sovereign immunity doctrine.
      As lawyers for Indian tribes are starting to realize, the doctrine of sovereign immunity isn't what it used to be—at least with the court decisions that have been coming down lately.
      The trend can be traced back at least as far as 1998, when in Kiowa Tribe of Oklahoma v. Manufacturing Technologies Inc. (523 U.S. 751), the U.S. Supreme Court ruled 63 in the tribe's favor but with one telling caveat: As Indian tribes do more and more business with non-Indians, the Court noted, the doctrine of tribal immunity is quickly becoming an anachronism.
      Three years later the Court weighed in again on tribal immunity in C&L Enterprise, Inc. v. Citizen Band Potawatomi Indian Tribe of Oklahoma (532 U.S. 411). In this case the high court ruled that the terms in a roofing contract providing for arbitration and court enforcement were enforceable in a state court because the tribe had effectively waived immunity from a civil suit by proposing and signing the contract.
      Here in California the most important sovereign immunity case now may be Medina v. Station Casinos. In August, superior court Judge Charles D. Wachob gave seven former employees of Thunder Valley Casino a green light to proceed with a proposed class action against the tribe. The non-Indian plaintiffs allege sexual harassment as well as gender and age discrimination by the Las Vegasbased operator of the Sacramento-area casino. Station Casinos counters that because it is under contract to the tribe, it is covered by the tribe's sovereign immunity.
      "There is a growing recognition that there have to be limits to sovereign immunity when tribes employ large numbers of nontribal members," says Richard G. McCracken of San Francisco's Davis, Cowell & Bowe, the same law firm that represents Unite Here, a labor union that has sought to organize casino workers. "Tribes," he adds, "should pull back and try to control the situation. If [they don't], they are likely to lose much more."
      On the political front, meanwhile, Indian tribes are facing new challenges as well. U.S. Senator John McCain (R-Ariz.), a longtime tribal-gaming proponent, is now proposing to limit Indian casino expansions and increase their financial reporting requirements. And on another front, the National Labor Relations Board issued a definitive ruling in 2004 asserting that its jurisdiction includes Indian business enterprises.
      It's unclear whether these legal developments can in any way be read as a deliberate attempt to curb Indian nations' abilities to govern themselves. But at the very least what is being tested is the power of state and federal governments to encroach on the economic interests of tribes to protect the well-being of non-Indians who work for them.
      Medina is a good example of this. The compact that United Auburn Indian Community signed with the state of California in 2004 required the tribe to pass an ordinance within 30 days to establish fair employment protections "at least as stringent" as federal and state laws. But not until more than a year after Medina was filed did the tribe incorporate key provisions of the Fair Employment and Housing Act and Title VII of the Civil Rights Act into tribal law.
      Ironically, the tribe's belated compliance with the terms of the compact may have helped the plaintiffs' case, by making it much easier for Judge Wachob to conclude that "applying current [state and federal] laws to defendants would not impair the Tribe's interests in governing on its lands as the Tribe has committed itself to abiding by those laws." Wachob also determined that Station Casinos was the plaintiffs' employer and can be sued on that basis.
      The tribe's attorney, Matthew Jacobs, had of course argued otherwise. Because the tribe owns the casino and had employed the plaintiffs, he said, the sovereign immunity doctrine should apply to the management company as well as the tribe.

Megan Kinneyn

Daily Journal Staff Writer

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