Oneida Tribe of Indians of Wisconsin v. State of Wis.

Decision Date20 December 1991
Docket NumberNo. 90-3337,90-3337
PartiesONEIDA TRIBE OF INDIANS OF WISCONSIN, Plaintiff-Appellant, v. STATE of WISCONSIN, Tommy G. Thompson and Donald J. Hanaway, Defendants-Appellees.
CourtU.S. Court of Appeals — Seventh Circuit

Milton Rosenberg, argued, Madison, Wis., Francis R. Skenadore, Oneida, Wis., for plaintiff-appellant.

Warren D. Weinstein, Asst. Atty. Gen., argued, Office of the Atty. Gen., Wis. Dept. of Justice, Madison, Wis., for defendants-appellees.

Before CUMMINGS, WOOD, Jr., and KANNE, Circuit Judges.

HARLINGTON WOOD, Jr., Circuit Judge.

The parties are interested in the operation of games both agree are lotto. They dispute, however, just what the game of lotto is and, in particular, what game Congress intended when it used the term "lotto" in § 4(7)(A)(i) of the Indian Gaming Regulatory Act ("Act"). 25 U.S.C.A. §§ 2701-2721, 2703(7)(A)(i).

The Oneida Tribe of Indians of Wisconsin ("Oneida Tribe") argues the term "lotto" as used in the Act means a lottery-type game akin to the game of chance conducted as Lotto--spelled with a capital "L"--by various states, including Wisconsin. The State of Wisconsin ("State") argues Congress intended "lotto" to mean a game played on a card, very much like bingo, both in physical appearance and method of playing. In a well reasoned opinion the District Court for the Western District of Wisconsin, Barbara B. Crabb, C.J., found that "lotto" as used in the Act unambiguously means the latter. Oneida Tribe of Indians v. Wisconsin, 742 F.Supp. 1033 (W.D.Wis.1990). We affirm. 1

The dispute arose in the course of the parties' negotiating a Tribal-State compact--an essential element if the Oneida Tribe is to conduct certain gaming operations on its tribal land--and has created an impasse. The impasse is one of categorization that turns upon the definition, or meaning, Congress intended for the term "lotto." The Act defines three categories of gaming, and that categorization in turn determines whether a state may prohibit or regulate gaming operations on Indian lands.

The Act in pertinent part provides the following jurisdictional scheme for the control of gaming operations on Indian lands:

(a)(1) Class I gaming on Indian lands is within the exclusive jurisdiction of the Indian tribes and shall not be subject to the provisions of this chapter.


(b)(1) An Indian tribe may engage in, or license and regulate, class II gaming on Indian lands within such tribe's jurisdiction, if--

(A) such Indian gaming is located within a State that permits such gaming....


(d)(1) Class III gaming activities shall be lawful on Indian lands only if such activities are--

. . . . .

(B) located in a State that permits such gaming ... and

(C) conducted in conformance with a Tribal-State compact entered into by the Indian tribe and the State....

25 U.S.C.A. § 2710 (emphasis added).

While the United States has penultimate oversight, the Act permits a state to exercise various types of control over class II and class III games. United Keetoowah Band of Cherokee Indians v. Oklahoma, 927 F.2d 1170, 1175 (10th Cir.1991); Seneca-Cayuga Tribe v. Oklahoma, 874 F.2d 709, 713 (10th Cir.1989). If the games in question are class II gaming activities, as the Oneida Tribe claims, they may be prohibited by the State, but they cannot be regulated by the State. On the other hand, if the games are class III gaming activities, as the State claims, not only may the State prohibit them, but also the State may regulate them pursuant to a Tribal-State compact. Moreover, they cannot be operated lawfully unless done so under a Tribal-State compact or as otherwise authorized by the Act or the State.

The parties' concern is whether the Oneida Tribe can operate its games lawfully, free of State regulation. We also perceive, although the parties have not so stated, a concern for revenues: whether the State, via regulation and pursuant to a Tribal-State compact, can tax the Oneida Tribe's gaming revenues and whether the two governments will compete as lottery operators for shares in the same market.

There is no dispute that the specific games at issue, denominated "Big Green" and "Cash-3," are lotteries, essentially indistinguishable from what a number of states, Wisconsin included, call "Lotto." In its brief the Oneida Tribe stated, "The 'Big Green' game is virtually identical to 'LottoAmerica/Megabucks,' a game operated by the State of Wisconsin, and is similar to other state lottery games." It also stated, "The tribe's second game, 'Cash-3,' is similar to state lottery games such as the 'Daily Game' or 'Pick-3.' "


The Indian Gaming Regulatory Act grants federal courts jurisdiction over "any cause of action initiated by an Indian tribe arising from the failure of a State to enter into negotiations ... or to conduct such negotiations in good faith ..." provided the parties follow statute-mandated procedures. 25 U.S.C.A. § 2710(d)(7)(A)(i), (B). The parties here have not followed those procedures and do not claim they have.

Federal jurisdiction arises, nonetheless, because one party is an Indian tribe seeking a declaratory judgment. 28 U.S.C. §§ 1362, 2201. Section 1362 provides, in relevant part, "The district courts shall have original jurisdiction of all civil actions, brought by any Indian tribe ... wherein the matter in controversy arises under the Constitution, laws, or treaties of the United States." 28 U.S.C. § 1362. The Declaratory Judgment Act creates the remedy. 2 We have, as one party, the Oneida Tribe of Indians of Wisconsin. This is a civil action, and, if there is a controversy, it has clearly arisen under the laws of the United States, specifically the Indian Gaming Regulatory Act, which became effective October 17, 1988. Furthermore, the district court's judgment is final. Thus, the only remaining question is whether this The appropriate test to determine if there is an actual controversy, one ripe for decision, under the Declaratory Judgment Act is the one stated in Maryland Casualty Co. v. Pacific Coal & Oil Co., 312 U.S. 270, 61 S.Ct. 510, 85 L.Ed. 826 (1941). Lake Carriers' Ass'n v. MacMullan, 406 U.S. 498, 506, 92 S.Ct. 1749, 1755, 32 L.Ed.2d 257 (1972). "Basically, the question in each case is whether the facts alleged, under all the circumstances, show that there is a controversy, between parties having adverse legal interests, of sufficient immediacy and reality to warrant issuance of a declaratory judgment." Maryland Casualty, 312 U.S. at 273, 61 S.Ct. at 512 (cited recently in Infinity Broadcasting Corp. v. Prudential Insurance Co., 869 F.2d 1073, 1075 (7th Cir.1989)).

case constitutes an "actual controversy," one that "tracks the 'cases' or 'controversies' requirement of article III." Harris Trust & Savings Bank v. E-II Holdings, Inc., 926 F.2d 636, 639 (7th Cir.1991).

An actual controversy exists. The parties disagree over the meaning of the term "lotto" in the Act. Their negotiation of a Tribal-State compact is at an impasse because of their resolute disagreement. Further, their legal interests are adverse, and there is a clear showing of sufficient immediacy. As the district court stated,

If ... the games are class II activities, plaintiff[, Oneida Tribe,] can offer them to the public now without waiting for the completion of the negotiations and without fearing that it will be subject to criminal sanctions. On the other hand, if defendants[, the State,] are correct that the games are properly classified in class III, plaintiff will lose all of its income from the games until and unless it can negotiate a tribal-state compact that permits the playing of such games.

Oneida, 742 F.Supp. at 1036-37.

Consequently, there is federal court jurisdiction under §§ 1362 and 2201, even though the parties have not followed the procedural steps mandated by the Act. 28 U.S.C. §§ 1362, 2201; 25 U.S.C.A. § 2710(d)(7).


This case comes on appeal of a summary judgment in an action for declaratory judgment. The issue itself is purely a question of law. The appropriate standard of review, de novo, is so widely accepted that it is frequently applied without citation to authority. See, for example, Mozee v. American Commercial Marine Service Co., 940 F.2d 1036, 1044 (7th Cir.1991) ("On issues of law, of course, our review is de novo."). Also, because "de novo review is compelled, no form of appellate deference is acceptable." Salve Regina College v. Russell, --- U.S. ----, 111 S.Ct. 1217, 1224, 113 L.Ed.2d 190 (1991).

We are specifically asked to determine the meaning of the term "lotto" as used in § 4(7)(A)(i) of the Indian Gaming Regulatory Act. That section of the Act is definitional and, in pertinent part, provides:

(7)(A) The term "class II gaming" means--

(i) the game of chance commonly known as bingo (whether or not electronic, computer, or other technologic aids are used in connection therewith)--

(I) which is played for prizes, including monetary prizes, with cards bearing numbers or other designations,

(II) in which the holder of the card covers such numbers or designations when objects, similarly numbered or designated, are drawn or electronically determined, and

(III) in which the game is won by the first person covering a previously designated arrangement of numbers or designations on such cards,

including (if played in the same location) pull-tabs, lotto, punch boards, tip jars, instant bingo, and other games similar to bingo, and

(ii) card games that ...

25 U.S.C.A. § 2703(7)(A) (emphasis added).

In attempting to divine the meaning of words or phrases in a statute, courts are guided by time-honored principles. If the "resolution of a question of federal law turns on a statute and the intention of

                Congress, we look first to the statutory language and then to the legislative history if the statutory language is unclear."  Blum v. Stenson, 465 U.S. 886, 896, 104 S.Ct. 1541, 1547-48, 79 L.Ed.2d

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