Dish Network Serv. L.L.C. v. Laducer

• Citation: 725 F.3d 877
• Decision Date: 05 August 2013
• Docket Number: No. 12–2871.,12–2871.
• Parties: DISH NETWORK SERVICE L.L.C., Plaintiff–Appellant v. Brian LADUCER; Hon. Madonna Marcellais, in her official capacity as Chief Judge of the Turtle Mountain Band of Chippewa Indians Tribal Court, and Presiding Judge in Brian Laducer v. Dish Network Service L.L.C., Civil Action No. 09–10122, Defendants–Appellees.
• Court: United States Courts of Appeals. United States Court of Appeals (8th Circuit)

725 F.3d 877

DISH NETWORK SERVICE L.L.C., Plaintiff–Appellant
v.
Brian LADUCER; Hon. Madonna Marcellais, in her official capacity as Chief Judge of the Turtle Mountain Band of Chippewa Indians Tribal Court, and Presiding Judge in Brian Laducer v. Dish Network Service L.L.C., Civil Action No. 09–10122, Defendants–Appellees.

No. 12–2871.

United States Court of Appeals,
Eighth Circuit.

Submitted: May 15, 2013.
Filed: Aug. 5, 2013.

[725 F.3d 879]

John J. Duffy, Pantelis Michalopoulos, Steptoe & Johnson, Washington, DC, Christopher J. Nyhus, Pearce & Durick, Bismarck, ND, for Plaintiff–Appellant.

Thomas A. Dickson, Dickson Law Office, Bismarck, ND, Ariston Edward Johnson, Johnson & Sundeen, Watford City, ND, for Defendants–Appellees.

Before WOLLMAN, MURPHY, and SMITH, Circuit Judges.

MURPHY, Circuit Judge.

This appeal grows out of a satellite television contract between DISH Network Service and Brian Laducer, an enrolled member of the Turtle Mountain Band of the Chippewa Indians. Brian used his daughter Lacey's credit card to open his account and DISH charged that card after Brian stopped making payments. Lacey then sued DISH in state court for consumer fraud and conversion, and DISH removed her action to federal court where it filed a third party complaint against Brian. Brian then filed an abuse of process claim against DISH in tribal court, and DISH moved to dismiss for lack of jurisdiction. The tribal court denied that motion, and the tribal appeals court declined on prudential grounds to hear DISH's appeal until after trial was completed. DISH then moved in the federal district court for a preliminary injunction enjoining the tribal

[725 F.3d 880]

court from conducting a trial on Brian's abuse of process claim. The district court ¹ denied the motion, and DISH appeals. We affirm.

I.

Brian Laducer opened a service account with DISH network in July 2007 using the credit card of his daughter, Lacey Laducer. Lacey is also a member of the Turtle Mountain Band. She and her father both reside on the Turtle Mountain Indian Reservation. Brian later opened his own checking account and then paid DISH out of that account. When he stopped making payments, DISH charged $323 to his daughter's credit card. That amount included a pro rated cancellation fee and partial unreturned equipment fee.

Lacey filed a complaint against DISH in North Dakota state court in April 2009 alleging consumer fraud and conversion. Civil Case No. 40–09–C–99 (N.D. D. Ct. April 21, 2009). DISH removed her case to federal district court on August 21, 2009, asserting that a demand letter from Lacey's counsel asking for $175,000 in settlement satisfied the amount in controversy requirement for diversity jurisdiction. Civil Case No. 4:09–cv–00052 (D. N.D. April 21, 2009). On September 1, 2009 DISH filed a third party complaint against Brian in the case it had removed to federal court, alleging conversion, breach of contract, fraud, and implied indemnification. After DISH filed that third party complaint, but before Brian was served with it, Brian initiated his own lawsuit in tribal court. He alleged there that DISH's third party complaint in the federal case was an abuse of process. Civil Case No. 09–10122 (Turtle Mountain Tribal Ct. Sept. 15, 2009). Brian likely became aware of DISH's third party complaint prior to service on him because Lacey's counsel had received notice of its filing. Brian's abuse of process complaint stated without elaboration that “Dish Network has taken advantage and abused the legal process to harm Mr. Laducer.”

The federal district court remanded Lacey's case against DISH, No. 4:09–cv–00052, back to state court on March 8, 2010, after concluding that the amount in controversy almost certainly was less than $75,000. DISH then moved in state court, No. 40–9–C–99, to join Brian as an indispensable party in Lacey's case. The state court granted that motion, and DISH brought a third party complaint against Brian identical to the one previously filed in federal court. Brian responded in the state court matter by bringing a counterclaim there charging DISH with abuse of process. At this point there were then pending two abuse of process claims by Brian against DISH: one in tribal court (No. 09–10122) relating to the federal case, and one in state court (No. 40–09–C–99) relating to state court proceedings.

The following claims were then before the North Dakota state court in No. 40–09–C–99: (1) Lacey's consumer fraud and conversion claim against DISH for charging her $323, (2) DISH's third party complaint against Brian for conversion, breach of contract, fraud, and implied indemnification, and (3) Brian's counterclaim against DISH for abuse of process. In January 2011 the state court granted summary judgment to DISH on one of the issues before it: Brian's counterclaim for abuse of process. Eight months later on September 13, 2011, the state court dismissed the remaining claims on the basis that the tribal courts possessed exclusive jurisdiction (Lacey's conversion and consumer

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fraud claim against DISH and DISH's third party complaint against Brian). No party appealed these orders.

Still pending in the Turtle Mountain tribal court was Brian's separate lawsuit brought there (No. 09–10122), alleging abuse of process based on DISH's filing in federal court. DISH moved to dismiss Brian's case for lack of tribal jurisdiction on the ground that the company is not a tribal member. The tribal court denied the motion, deciding that it possessed jurisdiction over the case under Montana v. United States.450 U.S. 544, 101 S.Ct. 1245, 67 L.Ed.2d 493 (1981). In Montana, the Supreme Court held that tribal courts retain civil jurisdiction over non Indians “who enter consensual relations with the tribe or its members, through commercial dealing, contracts, leases, or other arrangements.” Id. at 565, 101 S.Ct. 1245. DISH appealed to the Turtle Mountain Tribal Court of Appeals, which declined on prudential grounds to review the question of jurisdiction until after the tribal court's trial.

In May 2012 DISH brought this motion in federal district court seeking a preliminary injunction barring the tribal court from conducting a trial on the abuse of process claim. Civil Case No. 4:12–cv–00058 (D.N.D. May 18, 2012). Brian and the Honorable Madonna Marcellais, the presiding tribal court judge, were named as defendants. The federal district court denied the motion. While it concluded that DISH would be irreparably harmed if it were forced to litigate in a tribal forum which lacked jurisdiction, and that neither Brian nor Judge Marcellais would suffer any harm from granting the motion, the federal district court ruled that there was tribal court jurisdiction over the controversy under the first Montana exception and thus DISH was unlikely to prevail on the merits of its jurisdictional challenge.

II.

DISH appeals the denial of its motion for preliminary injunction, arguing that the federal district court erred in not finding that DISH had a substantial likelihood of prevailing on its jurisdictional challenge. It asserts that the court misapplied the test for whether to grant a preliminary injunction, which requires consideration of: (1) the threat of irreparable harm to the movant, (2) the weight of this harm as compared to any injury an injunction would inflict on other interested parties, (3) the probability that the moving party will succeed on the merits, and (4) the public interest. Gen. Motors Corp. v. Harry Brown's LLC, 563 F.3d 312, 316 (8th Cir.2009). The burden is on the movant to establish the need for a preliminary injunction, and on appeal from its denial we review the district court's “factual findings for clear error, its legal conclusions de novo, and its exercise of equitable judgment for abuse of discretion.” Id.

DISH contends that it would be irreparably injured by litigating in a tribal court that lacked jurisdiction and that the tribal courts in this case plainly lack jurisdiction because Brian's abuse of process tort claim occurred off of tribal land and is unrelated to the contract he signed with DISH. Brian argues that the tribal courts possess jurisdiction because the abuse of process claim is intimately connected to the dispute over his contract with DISH which concerned activity on tribal territory, and that DISH failed to exhaust its tribal remedies as required before seeking federal court intervention.

We first address the potential for irreparable harm to DISH. The district court determined that DISH “would suffer irreparable harm if forced to litigate in a Tribal Court that likely does not have jurisdiction,” citing

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Crowe & Dunlevy, P.C. v. Stidham, 640 F.3d 1140, 1157–58 (10th Cir.2011). That precedent arose in very different circumstances, however. In Crowe & Dunlevy the financial injury plaintiffs faced was found to be irreparable based on “the unique circumstances of this case” where sovereign immunity would have prevented the plaintiffs...