Penobscot Nation v. Georgia-Pacific Corp., No. CIV.00-101-B-H.

• Decision Date: 18 July 2000
• Docket Number: No. CIV.00-101-B-H.
• Citation: 106 F.Supp.2d 81
• Parties: PENOBSCOT NATION and Passamaquoddy Tribe, Plaintiffs, v. GEORGIA-PACIFIC CORPORATION, Great Northern Paper, Inc. and Champion International Corporation, Defendants. and State of Maine, Intervenor.
• Court: U.S. District Court — District of Maine

106 F.Supp.2d 81

PENOBSCOT NATION and Passamaquoddy Tribe, Plaintiffs, v. GEORGIA-PACIFIC CORPORATION, Great Northern Paper, Inc. and Champion International Corporation, Defendants. and State of Maine, Intervenor.

No. CIV.00-101-B-H.

United States District Court, D. Maine.

July 18, 2000.

Kaighn Smith, Jr., Melissa A. Hewey, Gregory W. Sample, Drummond, Woodsum & Macmahon, Portland, ME, for Penobscot Nation, Passamaquoddy Tribe, plaintiffs.

Catherine R. Connors, Matthew D. Manahan, Pierce, Atwood, Portland, ME, for Georgia-Pacific Corp., Great Northern Paper, Inc., Champion Intern. Corp., defendants.

William R. Stokes, Assistant Attorney General, Augusta, ME, for Maine, State of, intervenor-defendant.

ORDER ON DEFENDANTS' MOTION TO DISMISS

HORNBY, Chief Judge.

The plaintiff Indian tribes assert federal subject matter jurisdiction in this case on two bases: general federal question jurisdiction, 28 U.S.C.A. § 1331 (West 1993), and the Indian jurisdictional statute added in 1966, 28 U.S.C.A. § 1362 (West 1993). I conclude that neither will support this federal lawsuit.

BACKGROUND

Three paper companies (the defendants) threatened to sue the Penobscot Nation and Passamaquoddy Tribe¹ in state court to compel them to turn over certain documents under the Maine Freedom of Access Act. After the Tribes received notice from the paper companies but before the paper companies could get to state court under the statutorily required waiting period, the Tribes filed this federal lawsuit against them seeking an injunction against any state court lawsuit and a declaratory judgment that the Maine Freedom of Access Act violates "their federal right to be free of such state regulation." Compl. ¶ 10. The Tribes rely in part upon the Maine Indian Claims Settlement Act of 1980, 25 U.S.C.A. § 1721 et seq. (West 1983 & Supp.2000). The paper companies have moved to dismiss for lack of federal subject matter jurisdiction.

ANALYSIS

A. Section 1331

The general federal question jurisdiction statute gives federal district courts original jurisdiction of "all civil actions arising under the Constitution, laws, or treaties of the United States." 28 U.S.C.A. § 1331. "Arising under" has been narrowly interpreted: when a plaintiff has a claim created by state law and a defendant has a federal defense, the Supreme Court has made clear that the lawsuit does not "arise under" federal law and that there is no general federal question jurisdiction. See Franchise Tax Bd. of State of California v. Construction Laborers Vacation Trust, 463 U.S. 1, 9-12, 103 S.Ct. 2841, 77 L.Ed.2d 420 (1983). This has come to be known as the "well-pleaded complaint rule," "the basic principle marking the boundaries of the federal question jurisdiction of the federal district courts." Metropolitan Life Ins. Co. v. Taylor, 481 U.S. 58, 63, 107 S.Ct. 1542, 95 L.Ed.2d 55 (1987); see also American Nat. Red Cross v. S.G., 505 U.S. 247, 258, 112 S.Ct. 2465, 120 L.Ed.2d 201 (1992) ("The `well-pleaded complaint' rule applies only to statutory `arising under' cases....") (citations omitted). As a result, the plaintiff cannot file the case in federal court, see, e.g., Iowa Management & Consultants, Inc. v. Sac & Fox Tribe, 207 F.3d 488, 489 (8th Cir. 2000); TTEA v. Ysleta Del Sur Pueblo, 181 F.3d 676, 681 (5th Cir.1999), and the defendant cannot remove it to federal court, see Oklahoma Tax Com'n v. Graham, 489 U.S. 838, 840-41, 109 S.Ct. 1519, 103 L.Ed.2d 924 (1989) (per curiam).²

The answer is the same if the defendant acts first and brings a declaratory judgment action in federal court seeking a declaration that its federal defense trumps the plaintiff's state law claim. Although the defendant has thereby become the plaintiff and ostensibly has pleaded a claim that is federal, there still is no federal jurisdiction. Specifically, in 1983 the United States Supreme Court announced that a 1950 decision (Skelly Oil Co. v. Phillips Petroleum Co., 339 U.S. 667, 70 S.Ct. 876, 94 L.Ed. 1194) "has come to stand for the proposition that `if, but for the availability of the declaratory judgment procedure, the federal claim would arise only as a defense to a state created action, jurisdiction is lacking.'" Franchise Tax Bd., 463 U.S. at 16, 103 S.Ct. 2841; quoting 10A Charles A. Wright, Arthur R. Miller and Mary Kay Kane, Federal Practice and Procedure § 2767, at 744-45 (2d ed.1983). This statement made definitive what had been suggested in Public Service Commission v. Wycoff Co., 344 U.S. 237, 73 S.Ct. 236, 97 L.Ed. 291 (1952):

Where the complaint in an action for declaratory judgment seeks in essence to assert a defense to an impending or threatened state court action, it is the character of the threatened action, and not of the defense, which will determine whether there is federal-question jurisdiction in the District Court. If the cause of action, which the declaratory defendant threatens to assert, does not itself involve a claim under federal law, it is doubtful if a federal court may entertain an action for a declaratory judgment establishing a defense to that claim. This is dubious even though the declaratory complaint sets forth a claim of federal right, if that right is in reality in the nature of a defense to a threatened cause of action.

344 U.S. at 248, 73 S.Ct. 236.³

Here, the Tribes claim that federal law prevents the application to them of Maine's Freedom of Access Act. Perhaps they are correct (I express no view) but, if so, that is a matter to present to the courts of the State of Maine in defending against the paper companies' threatened lawsuit seeking to enforce the state law. Under the well-pleaded complaint rule as it applies to section 1331, that potential defense to the paper companies' state lawsuit does not furnish a basis for federal court jurisdiction in this lawsuit. The Tribes could not remove the paper companies' lawsuit from state court on the basis of their federal defense, and they cannot accomplish the same goal by preemptively filing their federal defense here first.⁴

B. Section 1362

Section 1362 gives federal courts original jurisdiction of "all civil actions, brought by an Indian tribe or band with a governing body duly recognized by the Secretary of the Interior, wherein the matter in controversy arises under the Constitution, laws, or treaties of the United States." 28 U.S.C.A. § 1362. The "arises under" language is remarkably parallel to that of section 1331. Should the analysis of claims, defenses and declaratory judgments/injunctions, then, be any different than it is for section 1331? Although the precedents are less definitive for section 1362 and although the Supreme Court has recognized some difference between the two statutes, I conclude that in this case there is likewise no jurisdiction under section 1362.

This jurisdictional statute was adopted in 1966. See Pub.L. 89-635, 80 Stat. 880. At the time, section 1331 had a requirement that at least $10,000 be at stake. See Pub.L. 85-554, 72 Stat. 415. In the Second Circuit, Judge Friendly concluded that section 1362's "sole purpose" was to eliminate section 1331's jurisdictional amount for lawsuits properly brought by Indian tribes and that otherwise the jurisdictional issues were the same. See Oneida Indian Nation v. County of Oneida, 464 F.2d 916, 920 n. 4 (2d Cir.1972), rev'd on other grounds, 414 U.S. 661, 94 S.Ct. 772, 39 L.Ed.2d 73 (1974). Judge Lumbard dissented, arguing that section 1362 should be interpreted more broadly and that, unlike section 1331, it should not be limited by the well-pleaded complaint rule "at least until the Supreme Court has passed on the question." 464 F.2d at 924-25. The Ninth Circuit agreed with Judge Lumbard. See Fort Mojave Tribe v. Lafollette, 478 F.2d 1016, 1018 (9th Cir.1973). The Friendly-Lumbard dispute went to the Supreme Court in 1974, but was not resolved. See Oneida Indian Nation, 414 U.S. at 682, n. 16, 94 S.Ct. 772. Accepting the premise of the well-pleaded complaint rule for purposes of both section 1331 and section 1362, the Supreme Court found that the underlying complaint in Oneida did in fact state a federal claim. 414 U.S. at 667, 682 n. 16, 94 S.Ct. 772. The Supreme Court declined, therefore, to reach the argument that section 1362, in addition to eliminating the jurisdictional amount, was "intended to expand the scope of `arising under' jurisdiction in the District Courts, beyond what judicial interpretations of that language have allowed under § 1331...." Id.

In 1991, however, the Supreme Court seemed to endorse Judge Friendly's narrow reading of section 1362. In Blatchford v. Native Village of Noatak, 501 U.S. 775, 111 S.Ct. 2578, 115 L.Ed.2d 686 (1991), the Court said:

Considering the text of § 1362 in the context of its enactment, one might well conclude that its sole purpose was to eliminate any jurisdictional minimum for "arising under" claims brought by Indian tribes. Tribes already had access to federal courts for "arising under" claims under § 1331, where the amount in controversy was greater than $10,000; for all that appears from its text, § 1362 merely extends that jurisdiction to claims below that minimum. Such a reading, moreover, finds support in the very title of the Act that adopted § 1362: "To amend the Judicial Code to permit Indian tribes to maintain civil actions in Federal district courts without regard to the $10,000 limitation, and for other purposes." 80 Stat. 880.

501 U.S. at 784, 111 S.Ct. 2578.⁵ But Blatchford also recognized that a previous decision, Moe v. Confederated Salish and Kootenai Tribes, 425 U.S. 463, 96 S.Ct. 1634, 48 L.Ed.2d 96 (1976), had found an undefined "something more" in section 1362. 501 U.S. at 784, 111 S.Ct. 2578.⁶ According to Blatchford, Moe means that "`at least in some respects'" — not "generally" — Indian tribes have broader access to federal courts, the way the United States would have if it were suing as trustee for the tribes. Id. (quoting 425 U.S. at 473, 96...