United States v. Walker River Irrigation Dist.

Decision Date22 May 2018
Docket NumberNo. 15-16478, No. 15-16479,15-16478
Citation890 F.3d 1161
Parties UNITED STATES of America, Plaintiff-Appellant, and Walker River Paiute Tribe, Intervenor-Plaintiff, v. WALKER RIVER IRRIGATION DISTRICT ; Estate of Herbert Garms, et al.; Circle Bar N Ranch, L.L.C., et al.; E.L.W. Ranches, Inc.; Tri-State Motor Transit Company; Desert Pearl Farms, GP, et al.; Douglas County, Nevada; John A. Mathias, et al.; Break-A-Heart, LLC, et al.; Bently Family Ltd. Partnership, et al.; Hawthorne Utilities, et al.; Nevada Bighorns Unlimited ; David J. & Pamela A. Peri Family Trust Agreement, et al.; National Fish and Wildlife Foundation; Dwight Craig Donovan; Yerington Ventures, LLC; Darla Clarke Perry, et al.; Annette R. Swainston, et al.; Residual Trust of the Heiman Family Trust, et al.; VGR Limited Partnership; Motley Living Trust Dated 12-23-70; Borda Family LP; Theodore David Haight; Leland D. Hayden, et al.; Marjorie L. Urrea, et al.; Fred Fulstone, Jr.; Nevada State of, et al.; Gregory B. Adams, et al.; Arlene M. Hoferer, et al.; California Department of Fish & Game, et al.; Norman W. and Kelli J. Annett Family Trust, et al.; Antler Peak Gold Inc.; Michael J. Chilton; County of Mono, California, et al.; Smith Valley Fire Protection District, et al.; Kyle A. Ruf; Shane Brandon; Borealis Mining Co. ; J & S Roberts Trust Dated 2-26-96; Suellen Fulstone, et al.; Mineral County; Centennial Livestock; U.S. Board of Water Commissioners ; Fenili Family Trust, c/o Peter Fenili and Veronica Fenili, Trustees; Six-N-Ranch, Inc., c/o Richard and Cynthia Nuti; Michael Nuti; Nancy Nuti; Ralph E. Nuti; Mary E. Nuti; Lawrence M. Nuti; Leslie Nuti; Mica Farms, LLC, c/o Mike Faretto; John and Lura Weaver Family Trust, c/o Lura Weaver, Trustee; Smith Valley Garage, Inc., c/o Dan Smith and Shawna Smith; Donald Giorgi; Lorie McMahon; Merle McMahon; Lyon County, Defendants-Appellees. United States of America, Plaintiff, and Walker River Paiute Tribe, Intervenor-Plaintiff-Appellant, v. Walker River Irrigation District ; Estate of Herbert Garms, et al.; Circle Bar N Ranch, L.L.C., et al.; E.L.W. Ranches, Inc.; Tri-state Motor Transit Company; Desert Pearl Farms, GP, et al.; Douglas County, Nevada; John A. Mathias, et al.; Break-A-Heart, LLC, et al.; Bently Family Ltd. Partnership, et al.; Hawthorne Utilities, et al.; Nevada Bighorns Unlimited ; David J. & Pamela A. Peri Family Trust Agreement, et al.; National Fish and Wildlife Foundation; Dwight Craig Donovan; Yerington Ventures, LLC; Darla Clarke Perry, et al.; Annette R. Swainston, et al.; Residual Trust of the Heiman Family Trust, et al.; VGR Limited Partnership; Motley Living Trust Dated 12-23-70; Borda Family LP; Theodore David Haight; Leland D. Hayden, et al.; Marjorie L. Urrea, et al.; Fred Fulstone, Jr.; Nevada State of, et al.; Gregory B. Adams, et al.; Arlene M. Hoferer, et al.; California Department of Fish & Game, et al.; Norman W. and Kelli J. Annett Family Trust, et al.; Antler Peak Gold Inc.; Michael J. Chilton; County of Mono, California, et al.; Smith Valley Fire Protection District, et al.; Kyle A. Ruf; Shane Brandon; Borealis Mining Co. ; J & S Roberts Trust Dated 2-26-96; Suellen Fulstone, et al.; Mineral County; Centennial Livestock; U.S. Board of Water Commissioners ; Fenili Family Trust, c/o Peter Fenili and Veronica Fenili, Trustees; Six-N-Ranch, Inc., c/o Richard and Cynthia Nuti; Michael Nuti; Nancy Nuti; Ralph E. Nuti; Mary E. Nuti; Lawrence M. Nuti; Leslie Nuti; Mica Farms, LLC, c/o Mike Faretto; John and Lura Weaver Family Trust, c/o Lura Weaver, Trustee; Smith Valley Garage, Inc., c/o Dan Smith and Shawna Smith; Donald Giorgi; Lorie McMahon; Merle McMahon; Lyon County, Defendants-Appellees.
CourtU.S. Court of Appeals — Ninth Circuit

Elizabeth Ann Peterson (argued), David L. Negri, Andrew "Guss" Guyarino, Katerine J. Barton, David C. Shilton, and William B. Lazarus, Attorneys; Jeffrey H. Wood, Acting Assistant Attorney General; United States Department of Justice, Washington, D.C.; for Plaintiff-Counterclaimant-Appellant.

Wes Williams Jr. (argued) Schurz, Nevada, for Intervenor-Plaintiff-Appellant.

Gordon H. DePaoli (argued) and Dale E. Ferguson, Woodburn & Wedge, Reno, Nevada, for Defendant-Appellee Walker River Irrigation District.

Bryan L. Stockton (argued), Senior Deputy Attorney General; Adam Paul Laxalt, Attorney General; Office of the Attorney General, Carson City, Nevada; for Defendant-Appellee Nevada Department of Wildlife.

Roderick E. Walston (argued) and Steven G. Martin, Best Best & Krieger, Walnut Creek, California; Stephen B. Rye, District Attorney, Lyon County District Attorney's Office, Yerington, Nevada; Jerry M. Snyder, Reno, Nevada; Stacy Simon, County Counsel, Office of the County Counsel, Mammoth Lakes, California; Therese A. Ure, Schroeder Law Offices P.C., Reno, Nevada; for Defendants-Appellees Lyon County, et al.

Before: A. Wallace Tashima, Raymond C. Fisher, and Jay S. Bybee, Circuit Judges.

OPINION

TASHIMA, Circuit Judge:

This case is but one among a group of related actions in a long-running and complex dispute over water rights in the Walker River Basin. This case began in 1924 when the United States filed suit in Nevada federal court to establish water rights in the Walker River Basin on behalf of the Walker River Paiute Tribe ("Tribe"). In 1936, the court entered a decree awarding water rights to the Tribe and various other claimants. In 1940, after remand from the Ninth Circuit, the district court amended the original decree and retained jurisdiction to modify it.1

The issues we confront in these appeals stem from the counterclaims filed by the Tribe in 1992 (and later by the United States) asserting new water rights. The district court ordered the Tribe and the United States to name as counterdefendants all water rights claimants in the Walker River Basin and to serve them with summons and the counterclaims. In 2013, after service was substantially complete, Judge Robert Clive Jones2 ordered briefing on Rule 12(b) issues related to jurisdiction and expressly ordered the litigants not to address other issues, such as res judicata , which were to be addressed at a later date. Nonetheless, in May 2015, without briefing or argument on the issue, the district court sua sponte dismissed all of the Tribe's and the United States' counterclaims on res judicata or jurisdictional grounds. The Tribe and the United States appeal.

We hold that the district court had continuing jurisdiction over the counterclaims and that it erred in dismissing the claims on res judicata or jurisdictional grounds without giving the parties an opportunity to brief the issue. Accordingly, we reverse and remand. On remand, we also order the reassignment of this case to another district judge.

I. Facts and Procedural Background3
A. The Walker River and the Reservation

The Walker River originates in the Sierra Nevada Mountains in Mono County, California, and terminates at Walker Lake in Mineral County, Nevada. The river is comprised of two forks: the East Walker River and West Walker River. The two forks merge near Yerington, Nevada, where the river then flows through the Walker River Paiute Reservation ("Reservation"). The river continues another twenty-one miles south before draining into Walker Lake. The Walker River Basin covers approximately 4000 square miles. The Reservation dates to November 29, 1859, and was established for the benefit of the Tribe. The initial Reservation encompassed 320,000 acres of land located southeast of Reno, Nevada, in the Walker River Basin.

B. First Federal Proceeding

At the turn of the twentieth century, conflicting claims to water rights arose among residents of the Walker River Basin. In 1902, Miller & Lux Corporation, a cattle and land company, filed suit in federal court seeking adjudication of its water rights in the Walker River Basin vis-à-vis 150 upstream entities and individuals. See Miller & Lux v. Rickey , 146 F. 574 (C.C.D. Nev. 1906) ;4 Rickey Land & Cattle Co. v. Miller & Lux , 218 U.S. 258, 259, 31 S.Ct. 11, 54 L.Ed. 1032 (1910). Two years later, Rickey Land & Cattle Company filed two actions in California state court against Miller & Lux, also seeking to quiet its title to water rights in the Walker River Basin. See Rickey Land & Cattle , 218 U.S. at 259, 31 S.Ct. 11. Miller & Lux moved to enjoin the proceedings in California on the ground that the federal court in Nevada had acquired prior exclusive jurisdiction. Id. at 260, 31 S.Ct. 11. The lower court agreed and enjoined the California proceedings. Id. The Supreme Court affirmed. Id. at 262, 31 S.Ct. 11.

In 1919, the lower federal court issued the "Rickey Decree" apportioning the relative surface-water rights among the 151 parties. Although neither the United States nor the Tribe participated in that litigation, the Rickey Decree recognized a state-law based irrigation water right for the Reservation. See United States v. Walker River Irrigation Dist. , 11 F.Supp. 158, 160 (D. Nev. 1935).

C. The 1924 Federal Proceeding

In 1924, the United States filed suit in the District of Nevada to establish federal water rights for the Reservation. At the time, the Reservation encompassed 86,400 acres of land. The named defendants were 253 individuals and entities located upstream from the Reservation. See id. at 159. The complaint, as amended in 1926, sought a right to an unimpeded flow of 150 cubic feet per second ("cfs") of water from the Walker River. The basis for the water claim was the original 1859 reservation of land, which the complaint alleged constituted an implicit "set aside ... of the waters of the said Walker River and its tributaries [in the amount of] 150 cubic feet of water per second of time." In addition, the United States requested a determination of "the relative rights of the parties hereto in and to the waters of the said river and its tributaries in Nevada and California."

Although other reservations existed in the...

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