1998 -NMSC- 25, Srader v. Verant

Citation1998 NMSC 25, 964 P.2d 82, 125 N.M. 521
Case DateJuly 20, 1998
CourtSupreme Court of New Mexico

BACA, Justice.

¶1 In this consolidated appeal, we review a district court's rulings concerning motions to dismiss on the basis of federal preemption, Rule 1-019 NMRA 1998, and Rule 1-012(B)(6) NMRA 1998. Plaintiffs Srader et al. are individuals who suffered gambling losses in Indian casinos after the start of Indian gaming in New Mexico in 1995. 1 In the first case consolidated within this appeal, Plaintiffs sued a group of Defendants consisting of numerous financial institutions (Financial Defendants). These entities have provided banking and financial services to gamblers and casinos both on and off the reservation since 1995. Plaintiffs argue that the Financial Defendants allegedly furthered and supported illegal casino gambling by providing financial services to casinos and gamblers in violation of existing state anti-gambling laws, the law of negotiable instruments, and New Mexico's criminal code. Plaintiffs want the Financial Defendants to stop providing financial services to gamblers and gambling casinos. Plaintiffs also seek to recoup their gambling losses.

¶2 The Financial Defendants sought dismissal of these claims before the district court, citing Rules 1-019 and 1-012(B)(6). Under Rule 1-019, they argued that the case could not proceed without the Indian gaming tribes because the tribes are indispensable parties in the determination of the issues presented. The Financial Defendants also asserted that sovereign immunity precludes the tribes' addition to the suit and that the claims should be dismissed. Regarding Rule 1-012(B)(6), the Financial Defendants argued that Plaintiffs do not state a claim for which relief can be granted. They asserted that some of the Plaintiffs' causes of action are premised upon criminal statutes that do not provide for private causes of action. The Financial Defendants also argued that Plaintiffs' other allegations are so strained as to render them legally insufficient. The district court granted dismissal, citing both Rule 1-019 and 1-012(B)(6). However, Plaintiffs sought review by the Court of Appeals, and it certified the case to this Court pursuant to NMSA 1978, § 34-5-14(C) (1972).

¶3 In the second case in this consolidated review, Plaintiffs sued a second group of defendants consisting of various New Mexico law enforcement officials (Government Defendants). Citing New Mexico statutes, Plaintiffs alleged that the Government Defendants breached their duty to enforce New Mexico's anti-gambling laws. As relief, Plaintiffs requested that, within New Mexico's territorial jurisdiction, the Government Defendants be required to prevent the flow of gambling money between the financial institutions, gamblers, and the casinos. Plaintiffs also sought an award of damages against some of the Government Defendants, arguing that these defendants failed to protect Plaintiffs from the harms resulting from gambling.

¶4 The Government Defendants sought dismissal of these claims before the district court on the basis of both federal preemption and Rule 1-019. The district court denied the motions seeking dismissal on these grounds. Subsequently, the Government Defendants sought interlocutory review of the trial court's rulings. See NMSA 1978, § 39-1-1 (1917). On appeal, the Government Defendants added a Rule 1-012(B)(6) argument to their other points for consideration. Like the Financial Defendants, the Government Defendants argued that the Plaintiffs fail to state a claim under Rule 1-012(B)(6) for which relief can be granted.

¶5 This Court consolidated these cases under Rule 12-202(F) NMRA 1998, and now considers the propriety of the district court's action in both cases. After careful review, we hold that federal law does not preempt the state law claims presented here. However, we uphold the district court's dismissal of the claims against the Financial Defendants based on Rule 1-019. In addition, under an analysis of the same rule, we reverse the denial of dismissal of the claims against the Government Defendants. Finally, because this conclusion disposes of all claims against all defendants in this case, we do not consider the trial court's decisions regarding Rule 1-012(B)(6).


¶6 We first review the Government Defendants' arguments that the Indian Gaming Regulatory Act (IGRA), 18 U.S.C. § 1166 (1994), and the weight of federal precedent preempt the state law claims presented. We hold that IGRA does not preempt the claims in this case.

¶7 The principle of federal preemption finds its genesis in the Supremacy Clause of Article VI of the United States Constitution. Preemption occurs when "federal law so occupies the field that state courts are prevented from asserting jurisdiction." State v. McHorse, 85 N.M. 753, 757, 517 P.2d 75, 79 (Ct.App.1973). Whether federal law preempts state law is generally a question of congressional intent. Montoya v. Mentor Corp., 122 N.M. 2, 4, 919 P.2d 410, 412 (Ct.App.1996).

¶8 Congress intended that IGRA establish the framework by which Indian tribes and states may establish compacts permitting Class III gaming within reservation land. See 25 U.S.C. § 2702 (1994). Within this framework, IGRA was intended to strike a balance between tribal sovereignty and states' rights in regulating gambling. See 25 U.S.C. § 2710(d)(3)(A) (1994) (permitting gaming in states where a valid compact between states and tribes exists); 25 U .S.C. § 2710(d)(3)(A) (1994) (...

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  • Azar v. Prudential Ins. Co. of America, 22,133.
    • United States
    • New Mexico Court of Appeals of New Mexico
    • 17 Enero 2003
    ...410. {31} "Whether federal law preempts state law is generally a question of congressional intent." Srader v. Verant, 1998-NMSC-025, ¶ 7, 125 N.M. 521, 964 P.2d 82. "`When Congress has considered the issue of preemption and has included in the 68 P.3d 921 legislation a provision expressly a......
  • Gallegos v. Pueblo of Tesuque, 26,149.
    • United States
    • New Mexico Supreme Court of New Mexico
    • 26 Abril 2002
    ...III gaming1 on Indian reservations located within state territory. See 25 U.S.C. § 2702 (1994); Srader v. Verant, 1998-NMSC-025, ¶ 8, 125 N.M. 521, 964 P.2d 82. Class III gaming would be lawful on Indian lands only if such activities were "conducted in conformance with a Tribal-State compac......
  • Pueblo of Pojoaque v. State, CIV 15–0625 JB/GBW
    • United States
    • United States District Courts. 10th Circuit. District of New Mexico
    • 9 Febrero 2017
    ...Pueblo, nor has it asserted its authority on Pojoaque Pueblo's lands. See QI Motion at 14 (citing Srader v. Verant , 1998-NMSC-025, ¶ 16, 125 N.M. 521, 964 P.2d 82 ). The Individual Defendants argue, moreover, that it is irrelevant whether the Gaming Board's actions indirectly impact Pojoaq......
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    • United States
    • United States District Courts. 10th Circuit. District of New Mexico
    • 30 Septiembre 2016
    ...omitted). The Individual Defendants rely heavily on the Supreme Court of New Mexico's opinion in Srader v. Verant , 1998–NMSC–025, 125 N.M. 521, 964 P.2d 82, for this important distinction. See Qualified Immunity Motion at 13-14. There, the Supreme Court of New Mexico considered whether New......
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