Indian Country, U.S.A., Inc. v. State of Okl. ex rel. Oklahoma Tax Com'n

• Decision Date: 22 September 1987
• Docket Number: Nos. 86-1819,86-1832 and 86-1887,s. 86-1819
• Parties: INDIAN COUNTRY, U.S.A., INC., and Muscogee (Creek) Nation, Plaintiffs-Appellees, Cross-Appellants, v. STATE OF OKLAHOMA ex rel. the OKLAHOMA TAX COMMISSION and the District Attorney of Tulsa County, Defendants-Appellants, Cross-Appellees.
• Court: U.S. Court of Appeals — Tenth Circuit

Page 967

829 F.2d 967

INDIAN COUNTRY, U.S.A., INC., and Muscogee (Creek) Nation, Plaintiffs-Appellees, Cross-Appellants, v. STATE OF OKLAHOMA ex rel. the OKLAHOMA TAX COMMISSION and

the District Attorney of Tulsa County,

Defendants-Appellants, Cross-Appellees.

Nos. 86-1819, 86-1832 and 86-1887.

United States Court of Appeals, Tenth Circuit.

Sept. 22, 1987.

M. Denise Graham, Asst. Dist. Atty., Tulsa, Okl., and Robert C. Jenkins, Atty. for State of Okl. ex rel. the Oklahoma Tax Com'n, for defendants-appellants, cross-appellees.

John Echols, Echols & Echols, Inc., Tulsa, Okl., (Lorraine Echols, Echols & Echols, Inc., Tulsa, Okl., and Geoffrey M. Standing Bear, Geoffrey M. Standing Bear, P.C., Window Rock, Ariz., with him on the brief), for plaintiffs-appellees, cross-appellants.

Before SEYMOUR and BARRETT, Circuit Judges, and BROWN, ^* District judge.

SEYMOUR, Circuit Judge.

The Muscogee (Creek) Nation and Indian Country, U.S.A., Inc. (ICUSA) brought this suit for declaratory and injunctive relief against the State of Oklahoma in connection with the "Creek Nation Bingo" enterprise located on Creek Nation land known as the "Mackey site." Plaintiffs alleged that the State could not lawfully regulate Creek Nation Bingo on tribal land or require the collection and remittance of state sales taxes on bingo activity sales. The district court agreed, concluding that state regulation and taxation are preempted and impermissibly interfere with tribal sovereignty. Accordingly, the court enjoined enforcement of state bingo laws and the state sales tax. The court also dismissed ICUSA as a party, concluding that the Tax Injunction Act, 28 U.S.C. Sec. 1341 (1982), bars ICUSA's action to enjoin the collection of state taxes.

On appeal, the State contends that the Creek Nation lands are not "Indian country," and that even if they are, the State nevertheless has complete civil and criminal jurisdiction over the site, including the authority to regulate and tax Creek Nation Bingo activities. On cross-appeal, the Tribe and ICUSA contend that ICUSA should not have been dismissed from the suit. ¹ We affirm in part and reverse in part.

This case involves the authority of the State of Oklahoma to regulate and tax certain bingo and bingo-related activities conducted on treaty lands still held by the Creek Nation. Although portions of our inquiry are guided by California v. Cabazon Band of Mission Indians, --- U.S. ----, 107 S.Ct. 1083, 94 L.Ed.2d 244 (1987), which held state regulation of Indian bingo on reservation land to be preempted, and by our conclusion that these lands are Indian country, this case presents additional issues arising from the unique history of relations between the United States and the "Five Civilized Tribes" in the former "Indian Territory." ² Because of the complex history of the Indian Territory and the numerous federal laws governing the Indians of Oklahoma, we emphasize that our inquiry is limited to the State's authority with respect to bingo conducted on Creek Nation lands. We begin by reviewing briefly the status and history of the Creek Nation and its tribal lands, and the nature of the Creek Nation Bingo enterprise.

I. BACKGROUND

A. Creek Nation and Relationship with Federal Government

The Creek Nation is a federally recognized Indian tribe located in what is today eastern Oklahoma. In 1979, the Creeks reorganized their tribal government under section three of the Oklahoma Indian Welfare Act, 25 U.S.C. Sec. 503 (1982), and adopted a new Creek Constitution, which was approved by the United States Department of the Interior. See Brief of Appellees, exh. C. The present constitution, like the 1867 constitution it replaced, organizes The special government-to-government and protectorate relationship continues to exist between the Creek Nation and the United States. In 1943, long after the historical events that form the center of controversy in the present case, a unanimous Supreme Court stated that "Congress has not terminated that [guardianship] relation with respect to the Creek Nation and its members." Board of County Comm'rs v. Seber, 318 U.S. 705, 718, 63 S.Ct. 920, 927, 87 L.Ed. 1094 (1943); cf. Northern Arapahoe Tribe v. Hodel, 808 F.2d 741, 749-50 (10th Cir.1987) (federal protectorate and trust relationship with Indian tribes). The Court in Seber concluded that the Creek Nation "still exists," 318 U.S. at 718, 63 S.Ct. at 927, and that under the Oklahoma Indian Welfare Act of 1936, 25 U.S.C. Secs. 501-509 (1982), the Tribe was "authorized to resume some of its former powers," Seber, 318 U.S. at 718, 63 S.Ct. at 927.

the tribal government into executive, legislative, and judicial branches.

B. Creek Nation Lands in Oklahoma

During the eighteenth and early nineteenth centuries, the Creek Nation occupied a large domain within the present states of Alabama and Georgia. See A. Debo, The Road to Disappearance 3 (1979 revised reprint) (orig. publ. 1941) [hereinafter Road to Disappearance]. In the 1820's, the federal government adopted a policy to forcibly remove the Five Civilized Tribes from the southeastern United States and relocate them west of the Mississippi River, in what is today Oklahoma. See Harjo v. Kleppe, 420 F.Supp. 1110, 1119 (D.D.C.1976), aff'd sub nom. Harjo v. Andrus, 581 F.2d 949 (D.C.Cir.1978). In a treaty concluded in 1832, the Creeks ceded their eastern homelands to the United States, in exchange for lands west of the Mississippi River. See Treaty, Mar. 24, 1832, United States--Creek Tribe of Indians, 7 Stat. 366 (Treaty of 1832). Article fourteen of the treaty provided that

"[t]he Creek country west of the Mississippi shall be solemnly guarantied to the Creek Indians, nor shall any State or Territory ever have a right to pass laws for the government of such Indians, but they shall be allowed to govern themselves, so far as may be compatible with the general jurisdiction which Congress may think proper to exercise over them."

Id., art. 14, 7 Stat. at 368; cf. Choctaw Nation v. Oklahoma, 397 U.S. 620, 625-26, 90 S.Ct. 1328, 1332, 25 L.Ed.2d 615 (1970) (similar treaties with Choctaws and Cherokees). In a subsequent treaty regarding these lands, the United States agreed to grant "a patent, in fee simple, to the Creek nation." Treaty, Feb. 14, 1833, United States--Creek Nation, art. 3, 7 Stat. 417, 419 (Treaty of 1833); see also Woodward v. De Graffenried, 238 U.S. 284, 293, 35 S.Ct. 764, 768, 59 L.Ed. 1310 (1915) (patent issued to Creek Nation in 1852, vesting title in tribe).

In 1856, the Creeks agreed to cede to the Seminole Tribe a portion of their lands. See Treaty, Aug. 7, 1856, United States--Creek and Seminole Tribes, 11 Stat. 699 (Treaty of 1856). With respect to the lands still held by the Creek Nation, the United States guaranteed the "same title and tenure" as promised and secured under the 1832 and 1833 treaties. Id., art. 3, 11 Stat. at 700. The 1856 treaty reaffirmed that "no State or Territory shall ever pass laws for the government of the Creek or Seminole tribes of Indians," and the United States pledged that "no portion of either of the tracts of country defined in [the treaty] shall ever be embraced or included within, or annexed to, any Territory or State." Id., art. 4, 11 Stat. at 700.

Ten years later, following the Civil War, the Tribe was forced to cede the western portion of its domain. See Treaty, June 14, 1866, United States--Creek Nation, 14 Stat. 785 (Treaty of 1866). The Creek Nation retained title to its "reduced ... reservation," id., art. 9, 14 Stat. at 788, which was promised to be "forever set apart as a home for said Creek Nation," id., art. 3, 14 Stat. at 786. In consideration for the lands ceded, the United States promised monetary payments "to enable the Creeks to occupy, restore, and improve their farms, and to make their nation independent and self-sustaining." Id. at 786-87. The Creeks agreed to permit federal legislation By the 1880s, however, assimilationist policies and the influx of whites into Creek territory resulted in pressure on Congress to extinguish tribal title, allot the land to individual Creeks giving them alienable title, dispose of "surplus" lands to non-Indians, and eventually create a new state. Subsequent agreements and federal legislation, intended to implement these plans, thus resulted in further reduction of the tribally-owned lands of the Creek Nation. Nevertheless, certain lands in eastern Oklahoma lying within the exterior boundaries of the 1866 Creek reservation are still owned by the Creek Nation pursuant to the patents and promises dating back to the treaties. It is a tract of that tribal land, on which Creek Nation Bingo is located, which is involved in the present suit.

                as necessary to protect persons and property within Indian Territory, but the treaty provided that "said legislation shall not in any manner interfere with or annul their present tribal organization, rights, laws, privileges, and customs."    Id., art. 10, 14 Stat. at 788.  Finally, the United States reaffirmed and reassumed all consistent prior treaty obligations toward the Creek Nation.  See id., art. 12, 14 Stat. at 790
                

C. Creek Nation Bingo

The Creek Nation operates bingo games on a tribally-owned tract of treaty land known as the "Mackey site," containing approximately one hundred acres along the Arkansas River in Tulsa County, Oklahoma. Creek Nation Bingo, the enterprise itself, is managed by Indian Country, U.S.A., Inc. (ICUSA), a non-tribal entity. ICUSA manages the games pursuant to a "Management Agreement" made between it and the Tribe, and specifically approved by the Creek National Council and the federal Bureau of Indian Affairs. See rec., vol. V, at 143 (testimony of Nelson Johnson, Deputy Comm'r, Creek Nation Gaming Comm'n); Brief of Appellees, exh. 2-A.

The bingo operations are licensed by the Tribe, supervised by the Creek Public Gaming Commissioner, and required to comply with a comprehensive gaming...