Maverick Gaming LLC v. United States
| Decision Date | 21 February 2023 |
| Docket Number | 3:22-cv-05325-DGE |
| Parties | MAVERICK GAMING LLC, Plaintiff, v. UNITED STATES OF AMERICA et al., Defendants. |
| Court | U.S. District Court — Western District of Washington |
ORDER GRANTING LIMITED INTERVENOR SHOALWATER BAY TRIBE'S MOTION TO DISMISS (DKT. NO. 85)
This matter comes before the Court on Limited Intervenor Shoalwater Bay Indian Tribe of the Shoalwater Bay Indian Reservation's (“Shoalwater”) motion to dismiss (Dkt. No. 85) for failure to join a required party pursuant to Federal Rules of Civil Procedure 12(b)(7) and 19. Having reviewed the briefing of the parties, the Court finds that Shoalwater is a required party that cannot be joined and therefore GRANTS Shoalwater's motion.
Plaintiff Maverick Gaming LLC (“Maverick”) brings suit to challenge Washington state's tribal gaming monopoly. (See Dkt. No. 66 at 4.)
The Indian Gaming Regulatory Act (“IGRA”) was passed in 1988 after the Supreme Court's decision in California v. Cabazon Band of Mission Indians, 480 U.S. 202 (1987), which overturned existing state laws regulating gaming on tribal lands. See Am. Greyhound Racing, Inc. v. Hull, 305 F.3d 1015, 1018 (9th Cir. 2002).
IGRA creates a classification system for different kinds of gaming. Id. at 1019 (internal citations omitted). IGRA further provides that Class III gaming is permitted on tribal lands only where such activities are authorized by the tribe “located in a State that permits such gaming for any purpose by any person, organization, or entity, and conducted in conformance with a Tribal-State compact entered into by the Indian tribe and the State.” 25 U.S.C. § 2710(d). Failure to operate pursuant to these provisions may subject a tribe to criminal liability under multiple statutes, including IGRA. See, e.g., 18 U.S.C. § 1166.
Once a tribe and a state have entered into a Tribal-State compact, they must submit the compact to the Secretary of Interior (“Secretary”) for approval. Amador Cnty., Cal. v. Salazar, 640 F.3d 373, 377 (D.C. Cir. 2011). The Secretary may “approve the compact; he may disapprove the compact, but only if it violates IGRA or other federal law or trust obligations; or he may choose to do nothing, in which case the compact is deemed approved after forty-five days” to the extent the compact complies with IGRA. Id.
Washington makes offering most forms of gaming a crime. See Wash. Rev. Code § 9.46.222. Nonetheless, starting in the 1990s the State slowly agreed to gaming compacts with Washington's federally recognized tribes. (Dkt. No. 87-1 at 11.) Tribal gaming provides significant economic benefits to the tribes themselves and also the State and local communities. See generally The Economic & Community Benefits of Tribes in Washington, Wash. Indian Gaming Ass'n, (May 2022), https://bit.ly/3RGO8Ri.
In March 2020, the Washington legislature passed a new bill permitting sports betting at tribal casinos and gaming facilities. See Wash. Rev. Code § 9.46.0368. Sports betting otherwise remains illegal in the State. The State has steadily entered into amended compacts with Washington's tribes permitting them to operate sports betting operations and the Secretary has approved these amended compacts. (Dkt. No. 66 at 17-19; see generally Dkt. No. 67.)
Maverick “owns and operates 18 cardrooms in Washington and owns several hotel/casinos in Nevada and Colorado.” (Id. at 4.) Maverick hopes to expand its gaming operations further in Washington but alleges that “it is unable to proceed because of Washington's criminal prohibitions of most forms of class III gaming.” (Id.) Maverick's complaint alleges the Secretary acted unlawfully when they approved Washington's compact amendments for sports betting because these amendments violated IGRA and the Fifth Amendment's equal protection clause. (Dkt. No. 66 at 33-34.) Maverick brings suit against the United States Department of Interior as well as responsible federal officials (together the “United States”) and various state officials (“Washington State Defendants”). (See generally id.)
Maverick filed its initial complaint on January 11, 2022. (Dkt. No. 1.) On July 5, 2022, Maverick filed an amended complaint. (Dkt. No. 66.) Shoalwater moved to intervene on August 3, 2022 (Dkt. No. 68) and the Court granted Shoalwater's motion for limited intervention on September 29, 2022 (Dkt. No. 84). On October 3, 2022, Shoalwater filed its motion to dismiss for failure to join a required party. (Dkt. No. 85.) A group of federally recognized Indian nations (“Amici” or “Tribes”) moved to submit an amicus brief (Dkt. No. 87), which this Court granted (Dkt. No. 91). On October 24, 2022, the federal government filed its response to Shoalwater's motion to dismiss. (Dkt. No. 94.) The United States supported the motion but disagreed with some of the bases for the motion. (See id. at 6.) The Washington State Defendants also filed a response in support of the motion. (Dkt. No. 95.) Maverick filed its response in opposition to the motion (Dkt. No. 96) on that same day, and Shoalwater filed a timely reply on October 28, 2022 (Dkt. No. 97).
C. Legal Standard
A party may move to dismiss a complaint pursuant to Federal Rule of Civil Procedure 12(b)(7) by challenging the plaintiff's “failure to join a party under Rule 19.” Fed.R.Civ.P. 12(b)(7). In evaluating whether to grant a motion pursuant to Rule 12(b)(7), a court must first “determine whether a nonparty should be joined under Rule 19(a).” E.E.O.C. v. Peabody W. Coal Co. 400 F.3d 774, 779 (9th Cir. 2005). If the court determines that a nonparty is a required party, “the second stage is for the court to determine whether it is feasible to order that the absentee be joined.” Id. If it is not feasible to join the absent party, “the court must determine at the third stage whether the case can proceed without the absentee, or whether the absentee is an ‘indispensable party' such that the action must be dismissed.” Id.; see also Klamath Irrigation Dist. v. United States Bureau of Reclamation, 48 F.4th 934, 943 (9th Cir. 2022).
The Court also accepts allegations in Plaintiff's complaint as true and construes the complaint in Plaintiff's favor. See Dine Citizens Against Ruining Our Env't v. Bureau of Indian Affs., 932 F.3d 843, 851 (9th Cir. 2019); see also Her Majesty Queen in Right of Canada as Represented by Minister of Agric. & Agri-Food v. Van Well Nursery, Inc., No. 2:20-CV-00181-SAB, 2021 WL 131261, at *1 (E.D. Wash. Jan. 13, 2021).
D. Rule 19(a) Analysis
The Court agrees Shoalwater is a required party.
An absentee is a required party if “in that person's absence, the court cannot accord complete relief among existing parties; or . . . that person claims an interest relating to the subject of the action and is so situated that disposing of the action in the person's absence may . . . as a practical matter impair or impede the person's ability to protect the interest.” Fed.R.Civ.P. 19(a)(1).
Shoalwater argues it is a required party because it “has a federal right to conduct Class III gaming on its Reservation, rights in its compact with Washington State that federal law expressly recognizes, and the sovereign right to immunity from unconsented suit.” (Dkt. No. 85 at 22.) Additionally, Shoalwater asserts that “complete relief is not available where the absent party is a tribe that is a signatory to the agreement at issue because the judgment would not be binding on the tribe, which could assert its rights under the agreement.” (Id. at 22-23.)
Maverick, in rebuttal, argues that Shoalwater's interest in conducting Class III gaming is not sufficient to make it a required party and that the United States can adequately represent its interests in this litigation. (Dkt. No. 96 at 11-17.)
The named defendants and Amici support Shoalwater's position. The United States, for example, filed a response noting controlling Ninth Circuit precedent in Dine and Klamath support a finding that Shoalwater is a required party. (Dkt. No. 94 at 6.) However, “the United States [also] disagrees with the ruling in Dine Citizens and reserves the right to assert in future proceedings that the United States is generally the only required and indispensable defendant in APA litigation challenging federal agency action.” (Id.) The Washington State Defendants and Amici argue Shoalwater is a necessary party and no currently named party can adequately represent their interests. (See Dkt. Nos. 95 at 3-4; 87-1 at 15-25).
Ninth Circuit case law is “clear that an absent party may have a legally protected interest at stake in procedural claims where the effect of a plaintiff's successful suit would be to impair a right already granted.” Dine, 932 F.3d at 852. And the Ninth Circuit has repeatedly held that tribes are necessary parties in third party suits challenging federal agency actions where the suits may negatively implicate tribal economic or sovereign interests. See, e.g., Backcountry Against Dumps v. Bureau of Indian Affs., No. 21-55869, 2022 WL 15523095, at *1 (9th Cir. Oct. 27, 2022); Klamath 48 F.4th at 944; Jamul Action Comm. v. Simermeyer, 974 F.3d 984, 997 (9th Cir. 2020); Dine, 932 F.3d at, 852-53; cf. Deschutes River All. v. Portland Gen. Elec. Co., 1 F.4th 1153, 1163 (9th Cir. 2021) (...
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