Jackson v. United States

• Decision Date: 31 January 1980
• Docket Number: No. F 77-35 Civil.,F 77-35 Civil.
• Citation: 485 F. Supp. 1243
• Parties: Barry W. JACKSON and Thomas E. Fenton, Plaintiffs, v. The UNITED STATES of America; The Alaska Federation of Natives, Inc., an Alaskan corporation; Doyon, Limited; Aleut Corporation; Arctic Slope Regional Corporation; Calista Corporation; Bering Straits Native Corporation; Bristol Bay Native Corporation; Chugach Native Incorporated; Cook Inlet Region Incorporated; Ahtna Incorporated; Koniag Incorporated; Nana Regional Corporation, Inc.; Sealaska Corporation; and The 13th Regional Corporation, all Alaska Corporations; Tanana Chiefs Conference; The Native Village of Minto; The Natives of Nenana; The Native Village of Tanacross; Eagle Village; The Native Village of Tetlin; The Northway Tribe of Indians; The Arctic Village; The Native Village of Venetie; The Fairbanks Native Association, Defendants.
• Court: U.S. District Court — District of Alaska

485 F. Supp. 1243

Barry W. JACKSON and Thomas E. Fenton, Plaintiffs, v. The UNITED STATES of America; The Alaska Federation of Natives, Inc., an Alaskan corporation; Doyon, Limited; Aleut Corporation; Arctic Slope Regional Corporation; Calista Corporation; Bering Straits Native Corporation; Bristol Bay Native Corporation; Chugach Native Incorporated; Cook Inlet Region Incorporated; Ahtna Incorporated; Koniag Incorporated; Nana Regional Corporation, Inc.; Sealaska Corporation; and The 13th Regional Corporation, all Alaska Corporations; Tanana Chiefs Conference; The Native Village of Minto; The Natives of Nenana; The Native Village of Tanacross; Eagle Village; The Native Village of Tetlin; The Northway Tribe of Indians; The Arctic Village; The Native Village of Venetie; The Fairbanks Native Association, Defendants.

No. F 77-35 Civil.

United States District Court, D. Alaska.

January 31, 1980.

COPYRIGHT MATERIAL OMITTED

Frederick Paul, Paul, Johnson, Paul & Riley, Seattle, Wash., Barry W. Jackson, Fairbanks, Alaska, for plaintiffs.

Arthur Lazarus, Washington, D. C., William H. Timme, Fairbanks, Alaska, for Doyon, Ltd. and Bristol Bay Native Corp.

James Linxwiler, Anchorage, Alaska, for Cook Inlet Region, Inc.

Sheila Gallagher, Anchorage, Alaska, David Wolf, Anchorage, Alaska, for Bering Straits Native Corp.

Robert M. Goldberg, Anchorage, Alaska, for Ahtna, Inc.

Gary Thurlow, Croft & Thurlow, Anchorage, Alaska, for Aleut Corp.

James F. Wickwire, Wickwire, Lewis, Goldmark, Dystel & Schorr, Seattle, Wash., Edward A. Merdes, Merdes, Schaible, Staley & DeLisio, Fairbanks, Alaska, for Arctic Slope Regional Corp.

Carol A. Johnson, Birch, Horton, Bittner & Monroe, Anchorage, Alaska, for Calista Corp.

Joseph P. Josephson, Josephson & Trickery, Inc., Anchorage, Alaska, David J. Walsh, Moderow, Walsh, Johnson & James, Anchorage, Alaska, for Chucagh Natives, Inc.

Edward Weinberg, Frederick L. Miller, Philip L. Chabot, Duncan, Brown, Weinberg & Palmer, P.C., Washington, D. C., James Linxwiler, Anchorage, Alaska, for Koniag, Inc.

Donald J. Beighle, Sealaska Corp., Juneau, Alaska, Michael M. Holmes, Juneau, Alaska, for Sealaska Corp.

David Wolf, Anchorage, Alaska, for Alaska Federation of Natives.

David Waters, Atty., Dept. of Justice, Washington, D. C., for United States.

MEMORANDUM AND ORDER GRANTING DEFENDANTS' MOTION TO DISMISS

POOLE, District Judge.

This action, which the complaint declares "lies exclusively in contract," arises out of eleven attorney-client agreements, some oral, some written, which are alleged to have been entered into between the plaintiffs, who are Alaska attorneys, and several Alaskan Native Villages and Regional Associations between the years 1967 and 1969. Plaintiffs claim to have rendered professional services entitling them to "equitable" compensation in connection with the passage of the Alaska Native Claims Settlement Act ("ANCSA" or "the Act"), P.L. 92-203, § 2, et seq., December 18, 1971, 43 U.S.C. § 1601, et seq. Pursuant to the long-standing provisions of 25 U.S.C. § 81, which requires that the Secretary of the Interior approve all contracts entered into with Indian Tribes, plaintiffs submitted six of the eleven contracts for the Secretary's approval. The Secretary approved three (involving the villages of Minto, Tanacross and Nenana) and disapproved the other three (involving the villages of Tetlin, Eagle and Northway). Plaintiffs thereupon declined to submit the remaining five agreements which involved the Alaska Federation of Natives, the Tanana Chiefs Conference, the Fairbanks Native Association, and the villages Venetie and Arctic Village. The latter five contracts therefore never received consideration by the Secretary.

By the passage of the Act in 1971, Congress intended to settle all aboriginal land claims and associated rights of Alaskan natives and native groups. The legislation provided for the Organization of Village Corporations to receive the lands and benefits for which they were eligible (Section 1607). It established twelve geographic regions covering the then existing twelve native associations (Section 1606(a)). It also authorized a thirteenth region for natives who were nonresidents of Alaska (Section 1606(c)). In its final form, the Act included a provision establishing an Alaska Native Fund of $2,000,000 for compensating the attorneys and consultants who had rendered services in connection with the passage of the statute. 43 U.S.C. § 1619. It established also a procedure requiring that claims for attorneys' and consultants' fees be filed with the Chief Commissioner of the Court of Claims not later than December 18, 1972, and for the Chief Commissioner to determine the amount payable to each claimant out of the Alaska Native Fund (the Fund). Specific provisions were inserted that no compensation in addition to that paid from the Fund could be received by any attorney or consultant who filed, or who could have filed, a claim under the Act, and that any contract or agreement to the contrary would be void. 43 U.S.C. §§ 1619(c), (d), and (f). Pursuant to these provisions, the plaintiffs and others filed claims for attorneys' fees with the Court of Claims. On April 15, 1975, plaintiffs were awarded the sum of $130,082 out of the Fund. Because the aggregate amount of all claims for attorneys' fees exceeded the $2,000,000 allocated to the Fund, the plaintiffs were not compensated to the full extent of their claims. As is set forth below, all plaintiffs joined in a stipulation that each would receive a pro rata award from the Fund.

Plaintiffs were dissatisfied with the compensation paid to them. They had been unhappy from the beginning since the Secretary of the Interior had announced even before the Act was passed that only hourly rate contracts would be approved. They filed this action in order to obtain additional fees for those services for which they did not receive compensation from the Fund. They seek declaratory judgments that their contracts with the native villages and regional associations are valid, and that the Fund is subject to liability under those contracts. Their theory of liability of the newly constituted native villages and associations seems to be that given the reorganization brought about by the Act, for the purposes of receiving benefits and of representation in the Fund, the regional corporations are suable under the "common fund" theory as beneficiaries of the Fund. No affirmative relief is sought against the corporations (except as to Doyon, which is said to constitute a "de facto present successor" to the interests and liabilities of plaintiffs' direct clients). The corporations are joined as indispensable, or at least as proper, parties since their interests in the Fund stand to be diminished to the extent of plaintiffs' success in holding the Fund liable for the unpaid balance of their fees. Plaintiffs also seek judicial review by the Court of the Secretary's action in disapproving the contracts with the villages of Tetlin, Eagle and Northway, and they ask for a writ of mandamus to require the Secretary to determine an "equitable" fee for plaintiffs' services rendered under the contracts. Finally, they seek a declaratory judgment that to the extent that 25 U.S.C. § 81 requires the Secretary to approve all contracts with Indian Tribes, it is unconstitutional both on its face and as applied in this case.

Federal jurisdiction is claimed to exist based on Federal Question Jurisdiction, 28 U.S.C. § 1331; the Administrative Procedure Act, 5 U.S.C. §§ 702 and 703; the Declaratory Judgment Act, 28 U.S.C. § 2201; and from 28 U.S.C. § 1361, conferring jurisdiction in mandamus.

Defendant Calista Corporation has moved to dismiss the action for lack of subject matter jurisdiction. The other defendants have joined in the motion. The several grounds of the motion will be discussed in turn.

FEDERAL QUESTION JURISDICTION UNDER 25 U.S.C. § 81

Plaintiffs ask the Court to declare that their attorney-client contracts with the defendant Alaskan Villages and Associations are enforceable and payable. They assert that the district court has jurisdiction because their claim "arises under" the laws of the United States within the meaning of 28 U.S.C. § 1331(a). They reason that since 25 U.S.C. § 81 requires the Secretary to approve such contracts before they can be enforced, that approval is a necessary element of their claim for attorneys' fees and hence their cause of action "arises" under 25 U.S.C. § 81.

In fact, however, plaintiffs place no reliance on 25 U.S.C. § 81 in seeking to enforce their contracts. Theirs is nothing more than a common law contract claim. Plaintiffs do anticipate that the defendants may raise the issue of the Secretary's disapproval of the contracts as a defense to the common law contract claim. It is now settled law that anticipated defenses which themselves stem from federal law, do not provide a sufficient basis to the plaintiff for initial federal jurisdiction. Phillips Petroleum Co. v. Texaco, Inc., 415 U.S. 125, 128, 94 S.Ct. 1002, 1003, 39 L.Ed.2d 209 (1974); Louisville and Nashville RR v. Mottley, 211 U.S. 149, 29 S.Ct. 42, 53 L.Ed. 126 (1908).

Plaintiffs' claim for "equitable" compensation arises under general state contract law, express or quantum meruit; because the statute in question does not create the cause of action. In order for federal question jurisdiction to exist, the federal law must be a direct element of the plaintiffs' claim. It is not enough that it comes in remotely or indirectly. A decision often relied on in determining the existence of federal question jurisdiction is Gully v. First National Bank in Meridian, 299 U.S. 109, 112, 57 S.Ct. 96, 97, 81 L.Ed. 70 (1936). In that case, Gully, the State Tax Collector of Mississippi, sued a national bank to collect state taxes claimed to be due. Under federal law, national banks were immune from state taxation except to the extent that Congress by s...