In re Indian Gaming Related Cases

• Decision Date: 11 June 2003
• Docket Number: No. 01-16283.,01-16283.
• Citation: 331 F.3d 1094
• Parties: In re INDIAN GAMING RELATED CASES. Chemehuevi Indian Tribe; Elk Valley Rancheria; Hoopa Valley Indian Tribe; Hopland Band of Pomo Indians; Redding Rancheria; Smith River Rancheria, Plaintiffs, and Coyote Valley Band of Pomo Indians, Plaintiff-Appellant, v. The State of California, Defendant-Appellee.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 1094

331 F.3d 1094

In re INDIAN GAMING RELATED CASES.

Chemehuevi Indian Tribe; Elk Valley Rancheria; Hoopa Valley Indian Tribe; Hopland Band of Pomo Indians; Redding Rancheria; Smith River Rancheria, Plaintiffs, and Coyote Valley Band of Pomo Indians, Plaintiff-Appellant, v. The State of California, Defendant-Appellee.

No. 01-16283.

United States Court of Appeals, Ninth Circuit.

Argued and Submitted December 3, 2002.

Filed June 11, 2003.

Eduardo G. Roy, San Francisco, California, for the appellant.

Sara J. Drake, Marc A. Le Forestier, and Christine Murphy, Office of the Attorney General, Sacramento, California, for the appellee.

Appeal from the United States District Court for the Northern District of California; Claudia Wilken, District Judge, Presiding. D.C. No. CV-98-01806-CW.

Before: BRIGHT,^* HAWKINS and FLETCHER, Circuit Judges.

OPINION

WILLIAM A. FLETCHER, Circuit Judge.

The Coyote Valley Band of Pomo Indians ("Coyote Valley") contends that the State of California ("the State") has refused to negotiate in good faith with the tribe to conclude a Tribal-State compact, as required by the Indian Gaming Regulatory Act ("IGRA"), 25 U.S.C. § 2710(d)(3)(A), and moved in the district court for an order that would require it to do so, 25 U.S.C. § 2710(d)(7)(B)(iii). In a carefully considered decision, the district court denied the motion and entered judgment for the State. We agree with the district court that the State has negotiated in good faith within the meaning of IGRA. We therefore AFFIRM.

I. Background

The historical background against which Coyote Valley and the State negotiated is important to an understanding of this case. We begin with the events leading up to the Supreme Court's landmark decision in California v. Cabazon Band of Mission Indians, 480 U.S. 202, 107 S.Ct. 1083, 94 L.Ed.2d 244 (1987). In the 1970s, some California tribes began to operate bingo halls on their lands as a way to generate revenue. "Such activities were controversial because the tribes generally refused to comply with state gambling laws, a situation that developed into a serious point of contention with [the] state government[]." Flynt v. California Gambling Control Comm'n, 104 Cal.App.4th 1125, 1132, 129 Cal.Rptr.2d 167 (2002). The State responded by attempting to enforce Cal.Penal Code § 326.5 (the "bingo statute") against these tribes. See Cabazon, 480 U.S. at 205, 107 S.Ct. 1083. California's bingo statute did not entirely prohibit bingo operations within the State, but it permitted only certain entities to run such operations and imposed various other requirements. See id. at 205, 209, 107 S.Ct 1083. The Cabazon and Morongo Bands of Mission Indians, who were operating bingo halls on their reservations in Riverside County, California, contended that the State lacked authority to enforce the statute against Indian tribes. See id. at 206, 107 S.Ct. 1083.

In response, the State contended that Congress had expressly consented to its exercise of jurisdiction over tribal bingo by passing Public Law 280, 18 U.S.C. § 1162. See Cabazon, 480 U.S. at 206, 107 S.Ct. 1083. Public Law 280, originally enacted in the 1950s, "granted California and certain other states jurisdiction over criminal violations and civil causes of action on Indian reservations," but "left civil regulatory jurisdiction in the hands of the Tribes." Sycuan Band of Mission Indians v. Roache, 54 F.3d 535, 539 (9th Cir.1994); see also Cabazon, 480 U.S. at 208, 107 S.Ct. 1083 ("[A] grant to States of general civil regulatory power over Indian reservations would result in the destruction of tribal institutions and values."). The State contended that because a violation of the bingo statute constituted a criminal misdemeanor under California law, Public Law 280 permitted its enforcement on tribal lands. Cabazon, 480 U.S. at 209, 107 S.Ct. 1083.

In 1987 in Cabazon, the Supreme Court ruled in favor of the tribes, adopting a distinction originally drawn by this court between "criminal/prohibitory" and "civil/regulatory" state laws:

[I]f the intent of a state law is generally to prohibit certain conduct, it falls within Pub.L. 280's grant of criminal jurisdiction, but if the state law generally permits the conduct at issue, subject to regulation, it must be classified as civil/regulatory and Pub.L. 280 does not authorize its enforcement on an Indian reservation.

Id. Because California permitted "a substantial amount of gambling activities, including bingo, and actually promote[d] gambling through its state lottery," the Court concluded that the State "regulate[d] rather than prohibit[ed] gambling in general and bingo in particular." Id. at 211, 107 S.Ct. 1083. Because there were no exceptional circumstances that warranted the assertion of State jurisdiction over tribal bingo operations, the Court held that the State lacked authority under Public Law 280 to enforce the bingo statute on Indian lands. Id. at 221-22, 107 S.Ct. 1083.

After the Court's decision in Cabazon, States sought recourse on Capitol Hill. Congress passed IGRA the next year, in 1988. As Judge Levi has recently written:

IGRA was Congress' compromise solution to the difficult questions involving Indian gaming. The Act was passed in order to provide "a statutory basis for the operation of gaming by Indian tribes as a means of promoting tribal economic development, self-sufficiency, and strong tribal governments" and "to shield [tribal gaming] from organized crime and other corrupting influences to ensure that the Indian tribe is the primary beneficiary of the gaming operation." 25 U.S.C. § 2701(1), (2). IGRA is an example of "cooperative federalism" in that it seeks to balance the competing sovereign interests of the federal government, state governments, and Indian tribes, by giving each a role in the regulatory scheme.

Artichoke Joe's v. Norton, 216 F.Supp.2d 1084, 1092 (2002) (alteration in original).

IGRA creates three classes of gaming, each subject to a different level of regulation. Class I gaming includes "social games solely for prizes of minimal value or traditional forms of Indian gaming engaged in by individuals as part of, or in connection with, tribal ceremonies or celebrations," 25 U.S.C. § 2703(6), and its regulation is left exclusively within the jurisdiction of the Indian tribes, id. § 2710(a)(1). Class II gaming includes bingo, id. § 2703(7)(A)(i), and certain card games, id. § 2703(7)(A)(ii), but excludes any banked card games, electronic games of chance, and slot machines, id. § 2703(7)(B).¹ The regulation of class II gaming is also left within the jurisdiction of the tribes, but is subject to federal-state regulation as set forth in IGRA. Id. § 2710(a)(2); see, e.g., id. § 2710(b)-(c). Class III gaming, at issue in this case, includes "all forms of gaming that are not class I gaming or class II gaming," 25 U.S.C. § 2703(8); in short, it includes the types of high-stakes games usually associated with Nevada-style gambling. Class III gaming is subject to a greater degree of federal-state regulation than either class I or class II gaming.

Given that class III gaming can be "a source of substantial revenue for the Indian tribes and a significant rival for traditional private sector gaming facilities," its regulation "has been the most controversial part of [] IGRA and the subject of considerable litigation between various Indian tribes and the states." Flynt, 104 Cal.App.4th at 1134, 129 Cal.Rptr.2d 167; see also Hotel Employees & Rest. Employees Int'l Union v. Davis (Hotel Employees), 21 Cal.4th 585, 596, 88 Cal.Rptr.2d 56, 981 P.2d 990 (1999). IGRA makes class III gaming lawful on Indian lands only if such activities are: (1) authorized by an ordinance or resolution adopted by the governing body of the Indian tribe and the Chairman of the National Indian Gaming Commission;² (2) located in a State that permits such gaming for any purpose by any person, organization, or entity; and (3) conducted in conformance with a Tribal-State compact entered into by the Indian tribe and the State and approved by the Secretary of the Interior. 25 U.S.C. § 2710(d)(1), (3)(B).

IGRA's compact requirement grants States the right to negotiate with tribes located within their borders regarding aspects of class III tribal gaming that might affect legitimate State interests. See id. § 2710(d)(3)(C); Kevin K. Washburn, Recurring Problems in Indian Gaming, 1 WYO. L. REV. 427, 429 (2001) ("In contrast to Class II gaming, Congress realized that. states were likely to have more serious and more legitimate public policy concerns related to more expansive casino type gaming which is defined as `Class III' gaming in IGRA. Accordingly, ... Congress limited Class III gaming to those states that already allow some measure of Class III gaming and gave states a voice in tribal decisions to conduct such gaming."). IGRA also imposes a concomitant obligation upon States to conduct those negotiations in good faith, 25 U.S.C. § 2710(d)(3)(A), and grants tribes the right to enforce that obligation by way of federal suit, id. § 2710(d)(7)(A).

IGRA provides that if no compact has been entered 180 days after an Indian tribe has requested that the State enter into compact negotiations, the tribe may bring suit in federal court. Id. § 2710(d)(7)(A)(i), (B)(i). If the court concludes that the State has failed to conduct negotiations in good faith, it shall order the State and the tribe to conclude a compact within a 60-day period. Id. § 2710(d)(7)(B)(iii). If the tribe and the State fail to do so, they must each submit to a court-appointed mediator a proposed compact representing their last best offer. Id. § 2710(d)(7)(B)(iv). The mediator will choose between the two proposed compacts the one that best comports with the terms of IGRA. Id. § 2710(d)(7)(B)(iv)-(v). If the State does not accept the mediator's chosen compact within 60 days, the Secretary of the Interior shall prescribe, consistent with the...