Casey v. Kennedy

• Citation: 714 F.Supp.2d 1064
• Decision Date: 27 April 2010
• Docket Number: Case No. CV F 09-1248 LJO SMS.
• Parties: TIMBISHA SHOSHONE TRIBE, Edward Beaman, Virginia Beck, and Cleaveland Lyle Casey, Plaintiffs, v. Joseph KENNEDY, Madeline Esteves, Pauline Esteves, Angela Boland, and Erick Mason, Defendants.
• Court: U.S. District Court — Eastern District of California

714 F.Supp.2d 1064

TIMBISHA SHOSHONE TRIBE, Edward Beaman, Virginia Beck, and Cleaveland Lyle Casey, Plaintiffs,

v.Joseph KENNEDY, Madeline Esteves, Pauline Esteves, Angela Boland, and Erick Mason, Defendants.

Case No. CV F 09-1248 LJO SMS.

United States District Court,E.D. California.

April 27, 2010.

A. Robert Rhoan, John M. Peebles, John Nyhan, Fredericks, Peebles & Morgan LLP, Sacramento, CA, for Plaintiffs.

ORDER ON PLAINTIFFS' MOTION TO DISMISS AND REMAND (Doc. 51) and DEFENDANTS' MOTION TO AMEND BY SUBSTITUTION (Doc. 54)

LAWRENCE J. O'NEILL, District Judge.

Introduction

The Court must determine whether it has federal subject matter jurisdiction over claims that, while based on state and tribal law, rely on decisions of the United States Department of Interior, Bureau of Indian Affairs (“BIA”). As set forth below, subject matter jurisdiction exists if the well-pleaded complaint establishes either: (1) federal law creates a cause of action; or (2) the plaintiff's right to relief necessarily depends on resolution of a substantial question of federal law. Plaintiffs' causes of action are rooted in either state law or tribal law; none is based on a federal statute. In addition, resolution of Plaintiffs' claims depends on substantial questions of state and tribal law, not federal law. Finally, defendants fail to carry their burden to establish subject matter jurisdiction. Accordingly, and for the reasons described below, this Court DISMISSES and REMANDS this action for lack of jurisdiction.

Background

Plaintiffs Timbisha Shoshone Tribe (“Tribe”), ¹ Edward Beaman, Virginia Beck, and Cleaveland Lyle Casey (collectively “Plaintiffs”) and defendants Joseph Kennedy (“Mr. Kennedy”), Madeline Esteves, Pauline Esteves, Angela Boland, and Erick Mason (collectively “Defendants”) are members of dueling factions that have contested the governance of the Tribe since 2007. ² Plaintiffs are members of the last undisputed Tribal Council, which was elected in November 2006 (“Rollback Council”). A dispute erupted at an August 25, 2007 meeting of the Rollback Council, resulting in the emergence of two factions. Plaintiffs are members of the faction based in Bishop, California (“Bishop faction”). Defendants' faction is based in Death Valley, California (“Death Valley faction”). The Bishop and Death Valley factions have held separate elections, and run parallel and competing tribal governments, since the August 2007 Rollback Council meeting. Each faction disputes the actions and validity of the other, and both have appealed to the BIA. The BIA appeals remain pending.

Plaintiffs claim that as the “governing majority” of the Rollback Council, they control Tribal governance. Plaintiffs accuse Defendants of forming an “illegal” Tribal Council as part of a “conspiracy to violate the Constitution and the laws of the Tribe by continuing to divert” tribal funds “to bank accounts maintained with various banks.” Compl. ¶ 2. Plaintiffs assert that Defendants' “[m]aintenence and use of these bank accounts is unlawful under the Constitution and laws of the Tribe in that the properly constituted Tribal Council of the Tribe is the only governing authority authorized to expend funding on behalf of the Tribe.” Id. In their complaint for injunctive, declaratory, and other relief, Plaintiffs assert the following causes of action against Defendants: (1) violation of tribal law; (2) conversion; (3) fraud; (4) breach of fiduciary duty; (5) abuse of process; (6) constructive trust; (7) wrongful interference with prospective economic advantage; (8) unfair competition; (9) accounting; and (10) declaratory relief as to the rights and obligations of the parties regarding the use of Tribal funds.

Plaintiffs initiated this action against Defendants on May 20, 2009 in the Inyo County Superior Court, Case No. SICVCV09-48418. Defendants removed the action to this Court on July 15, 2009. In the notice of removal, Defendants claim that this Court has original jurisdiction over this action pursuant to 28 U.S.C. § 1331 or 28 U.S.C. § 1362. Notice of Removal, ¶ 3. Defendants assert that “plaintiffs' claims arise under federal statutes including 28 U.S.C. § 1360 (“Public Law 280”), and various administrative decisions of the United States Department of the Interior, Bureau of Indian Affairs; the False Claims Act, 31 U.S.C. § 3729; and the Administrative Procedure Act, 5 U.S.C. § 702, among others.” Id. In the statement of jurisdiction, Defendants further contend that “disposition of plaintiffs' claims for relief will require resolution of substantial questions of federal law, including whether Public Law 280 conferred upon the courts of the State of California jurisdiction to resolve any or all of plaintiffs' purported causes of action.” Id.

After Defendants filed an answer to the complaint, Plaintiffs moved for a preliminary injunction against Defendants in September 2009. In opposition to the motion, and although Defendants removed this action to federal court, Defendants questioned whether Plaintiffs had standing to raise its claims, and asserted a defense of sovereign immunity. In its Order on Plaintiffs' Preliminary Injunction Motion, this Court addressed the jurisdictional issues raised, and concluded that because “Defendants raise serious jurisdictional issues in this action which bar Plaintiffs' suit, Plaintiffs have failed to make a ‘clear showing’ that they are likely to succeed in this action.” Timbisha Shoshone Tribe v. Kennedy, 687 F.Supp.2d 1171, 1183-88 (E.D.Cal.2009).

On February 3, 2010, Plaintiffs moved to dismiss voluntarily this action without prejudice. Defendants objected to the dismissal. In its February 18, 2010, 2010 WL 582054, Order on Plaintiffs' Request to Dismiss, this Court noted that “plaintiffs acknowledge that ‘both Defendants and the Court have indicated that they doubt subject matter jurisdiction exists in this matter.’ Plaintiffs explain that they have ‘reexamined their position’ and agree that subject matter jurisdiction is lacking.” Dismiss Order, p. 5. “Because the parties question[ed] whether subject matter jurisdiction exists, and because a Fed.R.Civ.P. 41(a)(2) dismissal is inappropriate when subject matter jurisdiction is lacking,” this Court granted Plaintiffs' request to withdraw its request for dismissal. In addition, this Court set a briefing schedule for the parties to address whether this Court had subject matter jurisdiction over Plaintiffs' claims.

Plaintiffs moved to remand this action for lack of subject matter jurisdiction on March 10, 2010. Defendants filed an incomplete opposition on March 24, 2010, and moved to amend by substitution the opposition on March 29, 2010. After briefing on the matter, this Court denied Defendants' motion to substitute by amendment but ordered supplemental briefing to address three specific questions. Order on Defendants' Motion to Amend By Substitution and Order for Additional Briefing (“Briefing Order”) (Doc. 57). Defendants filed their supplemental brief on April 13, 2010. Plaintiffs filed their supplemental brief on April 20, 2010. Having considered the parties' arguments, the relevant law, and the record, this Court issues the following order.

Standard of Review

Pursuant to 28 U.S.C. § 1441, a defendant may remove an action filed in state court to a federal district court if the federal court “would have original jurisdiction founded on a claim or right arising under the Constitution, treaties, or laws of the United States[.]” The removal

statute “is strictly construed and federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance.” Duncan v. Stuetzle, 76 F.3d 1480, 1485 (9th Cir.1996) (internal quotations and citations omitted). A defendant seeking removal of an action to federal court has the burden of establishing the grounds for federal jurisdiction. California ex rel. Lockyer v. Dynegy, 375 F.3d 831, 838 (9th Cir.2004).

A district court's federal-question jurisdiction extends over “only those cases in which a well-pleaded complaint establishes either the federal law creates the cause of action or that the plaintiff's right to relief necessarily depends on resolution of a substantial question of federal law.” Franchise Tax Board of California v. Construction Laborers Vacation Trust, 463 U.S. 1, 27-28, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983) (quoted in Christianson v. Colt Indus. Operating Corp., 486 U.S. 800, 808-09, 108 S.Ct. 2166, 100 L.Ed.2d 811 (1988)). Thus, the “presence or absence of federal-question jurisdiction is governed by the well-pleaded complaint rule, which provides that federal jurisdiction exists only when a federal question is presented on the face of the plaintiff's properly pleaded complaint.” Caterpillar, Inc. v. Williams, 482 U.S. 386, 392, 107 S.Ct. 2425, 96 L.Ed.2d 318 (1987) (internal quotations and citations omitted); Vaden v. Discover Bank, --- U.S. ----, 129 S.Ct. 1262, 1272, 173 L.Ed.2d 206 (2009). “The rule makes the plaintiff the master of the claim; he or she may avoid federal jurisdiction by exclusive reliance on state law,” id., and existence of federal jurisdiction is determined by the complaint at the time of removal. Libhart v. Santa Monica Dairy Co., 592 F.2d 1062, 1065 (9th Cir.1979). “If at any time before final judgment it appears that the district court lacks subject matter jurisdiction, the case shall be remanded.” 28 U.S.C. § 1447(c).

Discussion

In the notice of removal, Defendants asserted that this Court has jurisdiction over this action pursuant to 28 U.S.C. § 1331 and 28 U.S.C. § 1362. Both statutes confer jurisdiction to federal district courts over federal questions of law. 28 U.S.C. § 1331 provides that “district courts shall have original jurisdiction of all civil actions arising under the Constitution, laws, or treaties of the United States.” Similarly, 28 U.S.C. § 1362 confers to district courts “original jurisdiction of all civil actions, brought...