Cayuga Indian Nation of N.Y. v. Seneca Cnty.

• Decision Date: 23 October 2020
• Docket Number: No. 19-0032,August Term, 2019,19-0032
• Citation: 978 F.3d 829
• Parties: CAYUGA INDIAN NATION OF NEW YORK, Plaintiff–Counter-Defendant–Appellee, v. SENECA COUNTY, NEW YORK, Defendant–Counter-Claimant–Appellant.
• Court: U.S. Court of Appeals — Second Circuit

978 F.3d 829

CAYUGA INDIAN NATION OF NEW YORK, Plaintiff–Counter-Defendant–Appellee,

v.SENECA COUNTY, NEW YORK, Defendant–Counter-Claimant–Appellant.

No. 19-0032

August Term, 2019

United States Court of Appeals, Second Circuit.

Argued: January 7, 2020

Decided: October 23, 2020

David W. DeBruin (Zachary C. Schauf, Caroline C. Cease, on the brief), Jenner & Block LLP, Washington, DC; Daniel J. French, Lee Alcott (on the brief), Barclay Damon, LLP, Syracuse, NY, for Plaintiff–Counter-Defendant–Appellee Cayuga Indian Nation of New York.

Louis P. DiLorenzo (Brian Laudadio, Mary P. Moore, on the brief), Bond, Schoeneck & King, PLLC, New York & Rochester, NY, for Defendant–Counter-Claimant–Appellant Seneca County, New York.

Before: Kearse, Calabresi, and Carney, Circuit Judges.

Carney, Circuit Judge:

This appeal poses the question whether a federally recognized Indian tribe's sovereign immunity from suit prevents a county in New York State from foreclosing on tribal properties within the county's borders for the nonpayment of real estate taxes.

In 2007, the Cayuga Indian Nation of New York (the "Cayuga Nation," the "Cayugas," or the "Tribe") purchased several parcels of land located in Seneca County, New York (the "Properties"). After the Cayugas refused to pay real property taxes levied by Seneca County (the "County") on the Properties, the County in 2010 initiated foreclosure proceedings (the "Foreclosure Actions") under Article 11 of the New York Real Property Tax Law ("Article 11"). In response, the Cayugas sued the County in federal district court, asserting (among other claims) that the Foreclosure Actions were barred by the doctrine of tribal sovereign immunity from suit. The United States District Court for the Western District of New York (Siragusa, J. ) agreed with the Cayuga Nation, ruling in its favor on the parties’ cross-motions for summary judgment and enjoining the County from proceeding with the Foreclosure Actions.

In this appeal, Seneca County argues in principal part that the Foreclosure Actions may proceed under an "immovable-property exception" to tribal sovereign immunity from suit. At common law, the County asserts, a sovereign (e.g. , France) would not be immune from legal actions that challenged the sovereign's rights to real (i.e. , immovable) property located outside that sovereign's own territory (e.g. , in the United States). The County urges us to recognize an analogous exception here to the general rule of tribal sovereign immunity from suit, reasoning that the scope of the immunity to which indigenous tribes are entitled cannot exceed that enjoyed at common law by other sovereigns. On this basis, Seneca County contends, the Foreclosure Actions are permitted.

We need not reckon with the merits of that position, however, because we conclude that, even were we to recognize the County's proposed exception to immunity, the Foreclosure Actions lie outside its bounds. As we explain below, the Foreclosure Actions do not seek to establish Seneca County's rights in real estate such as are the animating concern of the immovable-property exception. Rather, because in the Foreclosure Actions the County seeks to seize the Properties as a remedy for the nonpayment of taxes, the proceedings are best seen as the functional equivalent of an action to execute on a money judgment. Viewed accordingly, they lie well within the categories of suits from which sovereigns were traditionally immune under the common law, and the existence or not of an immovable-property exception to tribal sovereign immunity is of no moment.

We also reject the County's interpretation of City of Sherrill v. Oneida Indian Nation of New York , 544 U.S. 197, 125 S.Ct. 1478, 161 L.Ed.2d 386 (2005) (" Sherrill "), as wholesale authorization for state tax foreclosure actions against tribes. We have previously considered and discarded that reading of Sherrill in two decisions: Oneida Indian Nation of New York v. Madison County , 605 F.3d 149 (2d Cir. 2010) (" Oneida I "), vacated and remanded sub nom. Madison County v. Oneida Indian Nation of New York , 562 U.S. 42, 131 S.Ct. 704, 178 L.Ed.2d 587 (2011), and Cayuga Indian Nation of New York v. Seneca County , 761 F.3d 218 (2d Cir. 2014) (" Cayuga I ") (preliminary injunction decision). While, as a technical matter, neither opinion's interpretation of Sherrill binds our ruling here, we agree with the reasoning consistently adopted in those two decisions. We therefore finally put to rest the misguided claim that Sherrill abrogated a tribe's sovereign immunity from suit. Read properly, it merely narrowed the scope of tribal immunity from certain forms of state regulation.

For these reasons, and as set forth more fully below, we AFFIRM the judgment of the District Court.

BACKGROUND

The factual background relevant to this appeal is undisputed and was established by the parties in their summary judgment submissions.

The Cayuga Nation is an Indian tribe recognized by the United States government. In 2007, the Cayugas purchased the Properties, comprising five parcels of land located within the boundaries of Seneca County, in upstate New York.¹ The Tribe refused to pay the related real property taxes levied by the County, however, taking the position that the Properties lay in "Indian country" within the meaning of federal law.² App'x 13.³ In due course, the Cayugas’ unpaid tax bill resulted in the imposition of liens against the Properties by operation of Article 11 of the New York Real Property Tax Law, the state statutory scheme governing the County's collection of real property taxes. See Oneida Indian Nation of N.Y. v. Madison Cty. , 665 F.3d 408, 429-30 (2d Cir. 2011) (" Oneida II ") (reviewing "the default tax-enforcement procedure established by Article 11"). Then, in October 2010, Seneca County moved under Article 11 to foreclose on the liens and seize the underlying Properties in satisfaction of the Cayugas’ tax debt.

As noted above, the Cayugas proceeded to sue the County in federal district court, seeking to enjoin the foreclosure proceedings. The Tribe maintained that New York law exempts their lands from state and local taxation, and that the Foreclosure Actions are also barred by tribal sovereign immunity and the federal Nonintercourse Act, 25 U.S.C. § 177.⁴

In August 2012, the District Court entered a preliminary injunction halting the Foreclosure Proceedings based entirely on the Tribe's claim of sovereign immunity from suit. In doing so, it relied heavily on our analysis in Oneida I , where we held that "the long-standing doctrine of tribal sovereign immunity" precluded New York counties from pursuing "[t]he remedy of foreclosure" against tribes that refuse to pay property taxes. 605 F.3d at 151. The Supreme Court vacated our Oneida I decision when, after the Court granted certiorari, the tribe expressly waived its sovereign immunity in that proceeding. See Madison Cty. v. Oneida Indian Nation of New York , 562 U.S. at 42, 131 S.Ct. 704.⁵ Nonetheless, the District Court found persuasive the reasoning we had adopted in the vacated decision, concluding on grounds similar to those we cited there that the Foreclosure Actions were very likely barred by the Tribe's sovereign immunity from suit, justifying an award of preliminary relief to the Tribe.

The County appealed, invoking our interlocutory jurisdiction. In July 2014, a panel of this Circuit affirmed the District Court's order. See Cayuga I , 761 F.3d at 221. In a brief opinion, we declined to express a view as to the substantive import of the Supreme Court's vacatur of Oneida I . See id. at 220. Instead, based on an independent review of the relevant law, our per curiam opinion simply reaffirmed Oneida I ’s conclusion that federally recognized tribes are immune from local tax foreclosure actions, see id. at 220-21, and therefore that the District Court did not abuse its discretion by entering preliminary injunctive relief.

Following remand, the parties cross-moved for summary judgment, and on December 11, 2018, the District Court ruled in favor of the Cayugas. Relying principally on its earlier preliminary injunction ruling and our interlocutory decision in Cayuga I , the District Court concluded that tribal sovereign immunity from suit prevented Seneca County from foreclosing on the Properties. It therefore granted the declaratory and permanent injunctive relief that the Cayugas requested and dismissed their remaining claims as moot. The County then filed this timely appeal.

DISCUSSION

We review de novo a district court's grant of summary judgment, "construing the evidence in the light most favorable to the non-moving party." CIT Bank N.A. v. Schiffman , 948 F.3d 529, 532 (2d Cir. 2020). A district court may award summary judgment "only if the court concludes that the case presents no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law." Morgan v. Dzurenda , 956 F.3d 84, 88 (2d Cir. 2020).

Seneca County advances two main contentions on appeal. First, it asserts that an "immovable-property exception" to sovereign immunity permits the Foreclosure Actions. Generally speaking, this exception refers to a common law doctrine that curtails sovereign immunity in legal actions contesting a sovereign's rights or interests in real property located within another sovereign's territory. Second, the County urges that the Supreme Court's decision in Sherrill ended tribal sovereign immunity altogether in tax foreclosure actions.

Below, we consider these arguments in turn. At the threshold, however, we briefly address whether Cayuga I controls this appeal—a position pressed by the Cayugas, who insist that it does because the County raises in this appeal the very arguments that we considered and rejected in Cayuga I .

The Cayugas’ view is incorrect. We resolved Cayuga I on interlocutory appeal of a preliminary injunction, a distinctive procedural posture. We long ago observed that, "[o]...