Comstock Oil & Gas Inc. v. Alabama & Coushatta Indian Tribes of TX

• Decision Date: 27 August 2001
• Docket Number: No. 00-40088,00-40088
• Citation: 261 F.3d 567
• Parties: (5th Cir. 2001) COMSTOCK OIL & GAS INC., Successor by merger to Black Stone Oil Company; ORYX ENERGY COMPANY; SUN OPERATING LIMITED PARTNERSHIP, Plaintiffs-Appellees-Appellants, v. ALABAMA AND COUSHATTA INDIAN TRIBES OF TEXAS; ET AL, Defendants, ALABAMA AND COUSHATTA INDIAN TRIBES OF TEXAS, Defendant-Appellee, MORRIS R. BULLOCK, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; PERRY D. WILLIAMS, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; MELINDA L. SYLESTINE, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; KEVIN P. BATTISE, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; MCCLAMROCH BATTISE, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; SIDNEY PONCHO, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; EDWIN D. BATTISE, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas, Defendants-Appellants
• Court: U.S. Court of Appeals — Fifth Circuit

Page 567

261 F.3d 567 (5th Cir. 2001)

COMSTOCK OIL & GAS INC., Successor by merger to Black Stone Oil Company; ORYX ENERGY COMPANY; SUN OPERATING LIMITED PARTNERSHIP, Plaintiffs-Appellees-Appellants, v. ALABAMA AND COUSHATTA INDIAN TRIBES OF TEXAS; ET AL, Defendants ALABAMA AND COUSHATTA INDIAN TRIBES OF TEXAS, Defendant-Appellee, MORRIS R. BULLOCK, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; PERRY D. WILLIAMS, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; MELINDA L. SYLESTINE, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; KEVIN P. BATTISE, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; MCCLAMROCH BATTISE, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; SIDNEY PONCHO, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas; EDWIN D. BATTISE, Individually and as Member of the Tribal Council of the Alabama and Coushatta Indian Tribes of Texas, Defendants-Appellants.

No. 00-40088

IN THE UNITED STATES COURT OF APPEALS FOR THE FIFTH CIRCUIT

Aug. 27, 2001

J. Robert Beatty (argued), Cynthia Keely Timms, Bradley Carroll Weber, William Scott Hastings, April Renee Terry, Locke Liddell & Sapp, Dallas, TX, for Comstock Oil & Gas Inc.

Alene Ross Levy, Michael T. Powell (argued), Lynne Liberato, Kent Geoffrey Rutter, Haynes & Boone, Houston, TX, for Oryx Energy Co. and Sun Operating Ltd. Partnership.

Michael D. Sydow, Michael Andrew Hawash, Verner, Liipfert, Bernhard, McPherson & Hand, Houston, Lisa K. Hsaio, Verner, Liipfert, Bernhard, McPherson & Hand, Washington, DC, Ronald Lee Jackson (argued), Russell DeWitt Leachman, Norman J. Gordon, Diamond, Rash, Gordon & Jackson, El Paso, TX, for Defendants-Appellants.

Appeals from the United States District Court for the Eastern District of Texas

Before POLITZ, DeMOSS, and STEWART, Circuit Judges.

CARL E. STEWART, Circuit Judge:

This case arises from a dispute regarding the validity of oil and gas leases entered into by the Alabama and Coushatta Indian Tribes of Texas ("the Tribe"), Comstock Oil and Gas Company, and Kerr-McGee Corporation¹ ( collectively "the oil companies"). Defendants-Appellants ( "the tribal council members") contend that the district court prematurely ruled on the existence and jurisdiction of the tribal court and thereby erroneously prevented the oil companies from exhausting their remedies in the tribal court. The tribal council members also argue that the district court lacked subject matter jurisdiction to hear the oil companies' claims and that the court erred in ruling that the tribal council members were not entitled to sovereign immunity. The oil companies allege that the district court erred in concluding that the Tribe was, however, entitled to sovereign immunity and by consequently dismissing their claims against the Tribe. For the reasons assigned herein, we affirm the district court in part, reverse in part, and remand.

FACTUAL AND PROCEDURAL BACKGROUND

The Tribe is federally recognized under the Alabama and Coushatta Indian Tribes of Texas Restoration Act. See 25 U.S.C. §§ 731-737. As such, it controls lands set aside and held in trust for it as a reservation. 25 U.S.C. §§ 733(a), 736(a). Between 1979 and 1993, the Tribe signed nine oil and gas exploration leases with the oil companies granting the right to explore and produce hydrocarbons. Two of the leases were negotiated and executed by the Bureau of Indian Affairs ("BIA") pursuant to the Indian Mineral Development Act of 1982. See 25 U.S.C. §§ 2101-2108. The State of Texas executed the remaining seven leases before the effective date of the Alabama and Coushatta Indian Tribes of Texas Restoration Act, and the BIA approved them.

On October 26, 1998, the Tribe and seven tribal council members filed suit in the United States District Court for the Eastern District of Texas, Lufkin Division, against the oil companies. Alleging that certain oil and gas leases were void because the Secretary of the Interior had not approved them, the Tribe and the tribal council members sought to cancel the leases. In addition, they claimed that the leases were void for deficiencies in production and that the oil companies had misappropriated natural gas liquids extracted from tribal lands. They sought damages in excess of $100,000,000, but dismissed the federal action on December 18, 1998.

On that same date, the Tribe filed suit in a tribal court that was formed after the Tribe initially filed suit in federal court. Again, the Tribe sought to have the leases declared null and void because of deficiencies in execution or production. In the alternative, the Tribe claimed that the leases were void because they had not been approved by the Secretary of the Interior pursuant to 25 U.S.C. § 81.

On February 9, 1999, naming the Tribe and tribal council members as defendants, the oil companies filed a motion for a declaratory judgment that the tribal court is nonexistent and that the disputed leases are in full effect. In response, the defendants moved to dismiss on three grounds. First, they claimed that the oil companies' declaratory judgment action sought to adjudicate the same facts as the tribal court action. Second, they asserted that sovereign immunity deprived the court of personal jurisdiction over the Tribe and the tribal council members in their official capacities. Finally, the tribe and tribal council members contended that the district court lacked subject matter jurisdiction because the oil companies failed to exhaust their tribal remedies.

The district court made the following conclusions. Neither the Tribe nor Congress waived the Tribe's sovereign immunity. Thus, with respect to the Tribe, the court dismissed the oil companies' motion for declaratory judgment for lack of personal jurisdiction. However, the court failed to extend the Tribe's sovereign immunity to the individual tribal council members and accordingly denied the motion seeking to dismiss them for lack of personal jurisdiction. In addition, the court determined that the tribal court was improperly constituted, that the doctrine of exhaustion of remedies was, therefore, inapplicable, and that the exhaustion doctrine did not bar the court's exercise of subject matter jurisdiction. The tribal council members now appeal these findings, and the oil companies cross-appeal the district court's conclusion that the Tribe was entitled to sovereign immunity.

DISCUSSION

I. Sovereign Immunity

A. Tribal Council Members

This Court reviews de novo whether an official is entitled to sovereign immunity. Beck v. Tex. State Bd. of Dental Exam'rs, 204 F.3d 629, 633 (5th Cir. 2000); see also Baker Elec. Coop., Inc. v. Haske, 28 F.3d 1466, 1471 (8th Cir. 1994)(stating that immunity of tribal officials is subject to de novo review).

The district court relied on TTEA v. Ysleta Del Sur Pueblo, 181 F.3d 676 (5th Cir. 1999), in ruling that the tribal council members were not entitled to sovereign immunity against the oil companies' declaratory judgment suit. But the tribal council members assert that this reliance was misplaced and attempt to distinguish not only TTEA but also Puyallup Tribe, Inc. v. Department of Game of State of Washington, 433 U.S. 165, 97 S. Ct. 2616, 53 L. Ed. 2d 667 (1977), and Santa Clara Pueblo v. Martinez, 436 U.S. 49, 98 S. Ct. 1670, 56 L. Ed. 2d 106 (1978). They argue that in each of those cases, the plaintiffs sought to enjoin the defendant tribal officials from carrying out or enforcing allegedly unconstitutional or illegal acts or from overstepping their jurisdictional mandate. In the present dispute, the tribal council members contend that they were acting lawfully on behalf of the Tribe and, thus, derivatively enjoy the tribe's sovereign immunity.²

The tribal council members have merely presented an encore argument before this court. Upon initially addressing this argument, the district court aptly expressed the error of the tribal council members' position. Comstock, 78 F. Supp. 2d 589, 593 (E.D. Tex. 1999)("Recent authority within the Fifth Circuit, binding on this court, indicates the Defendants' position is in error." (citing TTEA v. Ysleta Del Sur Pueblo, 181 F.3d 676 (5th Cir. 1999)). We agree with the district court.

The tribal council members have incorrectly characterized the import and applicability of TTEA to the case at bar. It is binding authority on this dispute. Therefore, the sundry cases that the tribal council members cite from other circuits to buttress their immunity claim, based on their allegedly having been acting within the scope of their authority, are unpersuasive and irrelevant. The district court correctly concluded that the tribal council members were not entitled to tribal sovereign immunity because, in the Fifth Circuit, tribal officials are not immune from suits for declaratory and injunctive relief. TTEA , 181 F.3d at 680-81 (reasoning that the "distinct but similar concept" of tribal sovereign immunity should not extend "further than the now-constitutionalized doctrine of sovereign immunity," which encompasses the proposition that: "State sovereign immunity does not preclude declaratory or injunctive relief against state officials"). Thus, the district court did not err in concluding that the tribal council members are not entitled to sovereign immunity against the oil companies' declaratory judgment action.

B. Tribe

1. Jurisdiction

Citing Swint v. Chambers County Commission, 514 U.S. 35, 51, 115 S. Ct. 1203, 131 L. Ed. 2d 60 (1995), the oil companies contend that the district court's interlocutory order holding that the Tribe is immune from suit is "inextricably intertwined" with the tribal council members' appellate issues because they involve the same...