Arizona v. Nation

• Citation: 944 F.Supp.2d 748
• Decision Date: 25 June 2013
• Docket Number: No. CV–11–00296–PHX–DGC.,CV–11–00296–PHX–DGC.
• Parties: State of ARIZONA, et al., Plaintiffs, v. TOHONO O'ODHAM NATION, Defendant.
• Court: U.S. District Court — District of Arizona

944 F.Supp.2d 748

State of ARIZONA, et al., Plaintiffs,

v.TOHONO O'ODHAM NATION, Defendant.

No. CV–11–00296–PHX–DGC.

United States District Court,

D. Arizona.

May 7, 2013.

Order Denying Reconsideration June 25, 2013.

Shane M. Ham, Grace Emma Rebling, John Laxson Blanchard, Mary Ruth Ogrady, Osborn Maledon PA, Evan Franklin Hiller, G. Michael Tryon, Thomas C. Horne, Office of The Attorney General, Brian Jay Schulman, Greenberg Traurig LLP, Phoenix, AZ, James P. Tuite, Jason Travis Hauter, Merrill C. Godfrey, Akin Gump Strauss Hauer & Feld LLP, Washington, DC, Linus Everling, Gila River Indian Community, Sacaton, AZ, for Plaintiffs.

Annie L. Owens, Danielle Spinelli, Seth P. Waxman, Shiva Nagaraj, Sonya L. Lebsack, Wilmer Cutler Pickering Hale & Dorr LLP, Washington, DC, Jonathan Landis Jantzen, Samuel Franklin Daughety, Tohono O'Odham Nation, Sells, AZ, Michael John Rusing, Todd McCabe Hardy, Rusing Lopez & Lizardi PLLC, Tucson, AZ, for Defendant.

ORDER

DAVID G. CAMPBELL, District Judge.

Defendant Tohono O'odham Nation (the “Nation”) plans to construct and operate a major casino on unincorporated land within the outer boundaries of the City of Glendale, Arizona, which is in the greater Phoenix metropolitan area. The State of Arizona, the Gila River Indian Community, and the Salt River Pima–Maricopa Indian Community (collectively “Plaintiffs”) argue that the proposed casino violates the 2002 Gaming Compact between the State of Arizona and the Nation (“the Compact”), and ask the Court to enjoin the casino's construction. The parties have filed cross-motions for summary judgment, and the Court heard oral arguments on April 9, 2013. For reasons explained below, the Court will grant the Nation's motion for summary judgment on all but one of Plaintiffs' claims, and will require additional briefing on the remaining claim.

I. Introduction and Summary.

Written agreements matter. Parties who reach an accord, particularly on a matter as important and complicated as tribal gaming, carefully document their agreement in writing. They do so to fix the precise terms of their contract, identify their respective obligations, and avoid later controversy about the nature and scope of their bargain. When disputes do arise, the written document usually constitutes the best evidence of the parties' agreement. Although other evidence can be considered, the written agreement takes center stage, with courts seeking to answer a single question: precisely what did the parties intend when the deal was struck? As a result, parties to complicated contracts hire lawyers to ensure that their written agreements are clear, comprehensive, and binding. Indeed, final contracts often declare that they are complete, that no other agreements have been reached by the parties, and that no unwritten promises will be enforced.

In this case, after long negotiation, the Compact was drafted by experienced lawyers, approved by the voters, and signed by the Governor and the Nation. The 67–page document contains different sections and covers every aspect of the Nation's gaming rights and obligations in Arizona. The Compact also declares that it is complete: “This compact contains the entire agreement of the parties ... and no other statement, agreement, or promise made by any party, officer, or agent of any party shall be valid or binding.” Doc. 195–11 at 76.

A dispute has now arisen. Plaintiffs claim that the Nation and the State agreed there would be no new casinos in the Phoenix metropolitan area. The Nation disagrees. Although Plaintiffs have presented some evidence to support their claim, the written Compact contains no such limitation. It does not prohibit the Nation from building a new casino in the Phoenix area. Even Arizona's liberal parol evidence rule does not permit the Court to find such an agreement in the Compact. As a result, the Court concludes that the parties did not reach such an agreement and that the Nation's construction of a casino on the Glendale-area land will not violate the Compact. The Court therefore must enter summary judgment on virtually all of Plaintiffs' Compact-related claims.

One Compact claim requires further briefing. Plaintiffs claim that even if the parties did not agree to prohibit a new casino in the Phoenix area, the Nation knew that the State and the voters understood there would be no such casino under the Compact. Indeed, Plaintiffs claim that the Nation actively encouraged this understanding of the Compact while secretly planning to build a casino in the Phoenix metropolitan area. Plaintiffs argue that this is enough, under § 201(2) of the Restatement (Second) of Contracts, for the Court to interpret the Compact in accordance with the State's understanding. Additional briefing is required before the Court can decide whether this claim can be resolved by summary judgment or whether a trial is required.

Plaintiffs also claim that federal law prohibits the Nation from building a casino on the Glendale-area land. The Court concludes, however, that gaming on that land is expressly permitted by the federal statute that authorizes Indian gaming. The Court therefore must enter summary judgment on Plaintiffs' statutory claims as well.

II. Background.

The Indian Gaming Regulatory Act (“IGRA”), 25 U.S.C. §§ 2701–2721, permits Class III gaming on “Indian lands,” but requires that the gaming be “conducted in conformance with a Tribal–State compact.” Id.§ 2710(d)(1). IGRA requires states to negotiate such a compact in good faith upon a tribe's request, and any resulting compact must be approved by the Secretary of the Interior before it becomes effective. Id.§ 2710(d)(3).

Arizona and the Nation first entered into a gaming compact in 1993. Doc. 195–4. In 1999, some four years before the compact was set to expire, the State commenced negotiations for a new compact with the Arizona Indian Gaming Association (“AIGA”), an organization that included the Nation and most of the gaming tribes in the State. Doc. 195–32 at 15–17, 19.¹ The parties reached agreement on the framework for a new compact in 2002, but the Governor was not authorized by Arizona law to sign the compact and a bill that would have authorized the Governor to sign failed in the Arizona legislature. Doc. 195–13; Doc. 195–27 at 4. In an effort to gain authorization by different means, a coalition of tribes proposed a ballot initiative, called Proposition 202, that set out the precise wording of the gaming compact and required the Governor to enter into the compact with any requesting tribe. Doc. 195–14; seeA.R.S. § 5–601.02. Voters approved Proposition 202, and the Compact was signed by the Governor and the Nation on December 4, 2002. Identical copies of the Compact were signed by the State and other gaming tribes. The Secretary of the Interior approved the Compact on January 24, 2003, and it became effective on February 5, 2003. Doc. 195–15.

Three months later, the Nation purchased an unincorporated parcel of land within the outer boundaries of Glendale, Arizona. The purchase was made under a different federal statute known as the Gila Bend Indian Reservation Lands Replacement Act (“LRA”), Pub. L. No. 99–503 100 Stat. 1798 (1986). The LRA was passed by Congress in response to flooding of the Nation's reservation land in the 1970s and 1980s by the federal government's Painted Rock Dam, and authorized the Nation to purchase replacement land in Arizona using funds provided by Congress. The Secretary of the Interior subsequently took a portion of the Glendale-area land into trust, effectively making it part of the Nation's reservation, and this Court upheld the Secretary's action. GRIC v. U.S., 776 F.Supp.2d 977 (D.Ariz.2011), aff'd,697 F.3d 886 (9th Cir.2012).

Plaintiffs argue that gaming on the Glendale-area land, which was acquired after the passage of IGRA, is not authorized by IGRA and would violate the Compact. Plaintiffs bring this suit pursuant to § 2710 of IGRA, which waives the Nation's sovereign immunity for suits to enjoin gaming activity in violation of a tribal-state compact. 25 U.S.C. § 2710(d)(7)(A)(ii).

III. Legal Standard.

A party seeking summary judgment “bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of [the record] which it believes demonstrate the absence of a genuine issue of material fact.” Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Summary judgment is appropriate if the evidence, viewed in the light most favorable to the nonmoving party, shows “that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.R.Civ.P. 56(a).

IV. Plaintiffs' Statutory Claim.

IGRA authorizes tribes to engage in gaming on Indian land that existed at the time of its passage on October 17, 1988. 25 U.S.C. § 2719. Section 2719(a) of IGRA generally prohibits gaming on land taken into trust by the Secretary after that date, but contains several exceptions. The Nation claims that the Glendale-area land falls within one of these exceptions for after-acquired land “taken into trust as part of a settlement of a land claim,” 25 U.S.C. § 2719(b)(1)(B)(i), and that gaming on the land is therefore permitted. Plaintiffs disagree, arguing that land acquired under the LRA does not qualify for the “settlement of a land claim” exception. The Court declined to resolve this disagreement at the motion to dismiss stage because the Department of the Interior was about to decide the issue (Doc. 43 at 12), but two years have passed with no decision by the Department, and the Court must resolve this case.

Plaintiffs also argue that the Nation is judicially estopped from asserting that it acquired the Glendale-area land in settlement of a land claim, and that it waived this argument through previous actions. The Court will address these arguments after addressing the “land claim” issue.

A. The Meaning of ...