Superior Oil Co. v. United States

• Decision Date: 29 January 1985
• Docket Number: No. C-82-0751J.,C-82-0751J.
• Citation: Superior Oil Co. v. United States, 605 F.Supp. 674 (D. Utah 1985)
• Parties: The SUPERIOR OIL COMPANY, a Nevada Corporation; and Arapaho Petroleum Inc., a Colorado Corporation, Plaintiffs, v. The UNITED STATES of America; the Department of the Interior of the United States; William P. Clark, Acting Secretary Designate of the Interior; Kenneth Smith, Assistant Secretary of the Interior for Indian Affairs; John Fritz, Deputy Assistant Secretary of the Interior for Indian Affairs for operations; Robert F. Buford, Director of Bureau of Land Management; Gene Sheldon, District Manager, Bureau of Land Management; Mat N. Millenbach, Area Manager, Bureau of Land Management; Bureau of Indian Affairs, an agency of the United States; Donald Dodge, Navajo Area Director, Bureau of Indian Affairs; the Navajo Tribe of Indians; the Navajo Tribal Council; Navajo Office of Mineral Development or its successor; Peterson Zah, individually, and as Chairman of the Navajo Tribal Council; Edward T. Begay, individually, and as Vice Chairman of the Navajo Tribal Council; Aktar Zamon, individually, and as director of the Navajo Mineral Department; and Alfred Dehiya, individually, and as Director of the Navajo Land Development Office, Defendants.
• Court: U.S. District Court — District of Utah

605 F. Supp. 674

The SUPERIOR OIL COMPANY, a Nevada Corporation; and Arapaho Petroleum Inc., a Colorado Corporation, Plaintiffs, v. The UNITED STATES of America; the Department of the Interior of the United States; William P. Clark, Acting Secretary Designate of the Interior; Kenneth Smith, Assistant Secretary of the Interior for Indian Affairs; John Fritz, Deputy Assistant Secretary of the Interior for Indian Affairs for operations; Robert F. Buford, Director of Bureau of Land Management; Gene Sheldon, District Manager, Bureau of Land Management; Mat N. Millenbach, Area Manager, Bureau of Land Management; Bureau of Indian Affairs, an agency of the United States; Donald Dodge, Navajo Area Director, Bureau of Indian Affairs; the Navajo Tribe of Indians; the Navajo Tribal Council; Navajo Office of Mineral Development or its successor; Peterson Zah, individually, and as Chairman of the Navajo Tribal Council; Edward T. Begay, individually, and as Vice Chairman of the Navajo Tribal Council; Aktar Zamon, individually, and as director of the Navajo Mineral Department; and Alfred Dehiya, individually, and as Director of the Navajo Land Development Office, Defendants.

No. C-82-0751J.

United States District Court, D. Utah, C.D.

January 29, 1985.

COPYRIGHT MATERIAL OMITTED

Arthur H. Nielsen, Thomas Jepperson, Robert L. McIntyre, Salt Lake City, Utah, for plaintiffs.

Joseph Anderson, Asst. U.S. Atty., William R. McConkie, Salt Lake City, Utah, Louis Denetsosie, Navajo Nation Dept. of Justice, Window Rock, Ariz., Kevin N. Anderson, Salt Lake City, Utah, for defendants.

JENKINS, Chief Judge.

The defendants' Motions to Dismiss the Amended Complaint and the defendants' Motion for Summary Judgment were argued orally on March 16, 1984. Arthur H. Nielsen, Thomas Jepperson, and Robert L. McIntyre represented the plaintiffs; Joseph Anderson and William W. McConkie represented the United States defendants; and Louis Denetsosie and Kevin N. Anderson represented the Navajo defendants. After due consideration of the oral arguments and the memoranda submitted by the parties, the court enters this Memorandum Opinion.

The defendants' motions raise a series of questions to the sovereign immunity of the Navajo Tribe and the jurisdiction of this court. Certain oil and gas leases between the plaintiffs or their predecessors and the Tribe on land within the Navajo reservation form the subject matter of the action.

The plaintiffs allege in Count I of the Amended Complaint that the Tribe, as lessor, executed an oil and gas lease with the plaintiff Arapaho Petroleum, Inc. (Lease No. 5184). The Secretary of the Interior then approved that lease according to the terms of the Omnibus Indian Mineral Leasing Act of 1938, 25 U.S.C. §§ 396a-396g (1976). Arapaho designated The Superior Oil Company as its "operator and local agent" to act on Arapaho's behalf. Amended Complaint, at ¶ 39 (filed November 15, 1983).

Thereafter, Superior performed seismic and other geophysical studies on the lands covered by the lease. Superior then obtained approval to drill a well from the Tribe and the Department of the Interior. However, before drilling the well, Superior requested the Tribe and the Bureau of Indian Affairs to reissue a seismic permit to allow Superior to determine more accurately the best location for the proposed well.¹ Neither the Tribe nor the Bureau of Indian affairs has acted on the requests. The plaintiffs allege that the Navajo defendants have expressed a desire to have lease No. 5184 expire so that the Tribe could negotiate a new lease with a higher royalty and bonus. In addition, the plaintiffs claim that the Navajo defendants have informed Superior that they would take every action possible to see that the lease would expire. Amended Complaint, at 10-18.

In Count II of the Amended Complaint, the plaintiffs allege similar facts regarding lease No. 5299, which was executed by Gulf Oil Corporation as the lessee. Gulf also designated Superior as its operator and local agent. Superior then requested a seismic permit from the Tribe and from the Bureau of Indian Affairs. Not long thereafter, Gulf assigned the lease to Superior, and Superior requested that the Tribe and the Bureau of Indian Affairs approve that assignment. Neither the federal government nor the Navajo defendants have acted on either the request for a seismic permit or the request for approval of the assignment. The plaintiffs allege that the Navajo defendants have refused to act on the requests so that lease No. 5299 would expire and the Tribe could negotiate a new lease with a higher royalty and bonus. Amended Complaint, Count II, at 19-20.

In Count III of the Amended Complaint, the plaintiffs allege that Superior has received various other assignments of oil and gas leases as well as assignments of operating rights that pertain to oil and gas leases. Superior requested both the Bureau of Indian Affairs and the Tribe to approve the various assignments. However, Superior alleges, the Navajo defendants have refused to act on the requests; and, as a result of that refusal, the Plaintiffs have been deprived of property rights without due process of law or equal protection under the law in violation of the Indian Civil Rights Act, 25 U.S.C. § 1302 (1976).

The Tribe asserts that it is immune from suit and thus this court lacks jurisdiction over the Tribe. The Tribe further asserts that its immunity extends to the Navajo Tribal Council (the Tribe's governing body) and to the Navajo Office of Mineral Development (an agency of the Tribe responsible for the development of the Tribe's mineral resources). The Tribe also claims that its immunity prevents this court from exercising jurisdiction over a case involving the following individual Navajo defendants, in either their official or personal capacities: Peterson Zah, Chairman of the Tribal Council; Edward T. Begay, Vice Chairman of the Tribal Council; Alfred DeHiya, Director of the Navajo Land Development Office; and Aktar Zamon, Director of the Navajo Mineral Department.

After considering the oral arguments, and after reviewing the extensive memoranda filed in this case, the court has determined that it has no jurisdiction, that the defendants' motion for summary judgment should be granted, and that the plaintiffs' complaint should be dismissed.

I. SOVEREIGN IMMUNITY OF THE NAVAJO TRIBE

That the Navajo Tribe is immune from certain suits is beyond dispute. "Indian Tribes have long been recognized as possessing the common-law immunity from suit traditionally enjoyed by sovereign powers." Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58, 98 S.Ct. 1670, 1677, 56 L.Ed.2d 106 (1978). See also, Puyallup Tribe, Inc. v. Department of Game of Washington, 433 U.S. 165, 172-73, 97 S.Ct. 2616, 2621, 53 L.Ed.2d 667 (1977); United States v. United States Fidelity and Guaranty Co., 309 U.S. 506, 512-13, 60 S.Ct. 653, 656-57, 84 L.Ed. 894 (1940). See generally, F. Cohen, Handbook of Federal Indian Law 324-28 (1982 ed.). However, immunity from suit is not absolute. It is subject to complete defeasance by an act of Congress. Santa Clara, 436 U.S. at 58, 98 S.Ct. at 1677. The tribe itself can also waive its immunity. Merrion v. Jicarilla Apache Tribe, 617 F.2d 537, 540 (10th Cir. 1980), aff'd, 455 U.S. 130, 102 S.Ct. 894, 71 L.Ed.2d 21 (1982).

The plaintiffs assert three separate bases for congressional extinguishment. First, they argue that Congress' exercise of plenary control over oil and gas operations through the passage of the Omnibus Indian Mineral Leasing Act, 25 U.S.C. §§ 396a-396g (1976), extinguished the Tribe's immunity from suit. Second, they claim that Congress extinguished the Tribe's immunity by passing the Indian Civil Rights Act, 25 U.S.C. §§ 1301-03 (1976). Finally, the plaintiffs assert that the immunity insulates the Tribe only from an action for money damages, and does not insulate the Tribe from an action for injunctive and declaratory relief.² Each of these claims is without merit.

First, the Omnibus Indian Mineral Leasing Act did not diminish the Tribe's sovereign immunity. The Supreme Court stated in Santa Clara that "a waiver of sovereign immunity `cannot be implied but must be unequivocally expressed.'" 436 U.S. at 58, 98 S.Ct. at 1677, quoting United States v. Testan, 424 U.S. 392, 399, 96 S.Ct. 948, 953, 47 L.Ed.2d 114 (1976). Because nothing on the face of the Act indicates a congressional extinguishment of the Tribe's immunity, the Act does not affect the Tribe's sovereign immunity.

Second, the Indian Civil Rights Act did not diminish the Tribe's sovereign immunity. The Supreme Court's opinion in Santa Clara is dispositive of this issue as well. The Court in Santa Clara specifically concluded that the Indian Civil Rights Act did not extinguish the Tribe's sovereign immunity. 436 U.S. at 59, 98 S.Ct. at 1677.

The plaintiffs rely on an exception to Santa Clara that the Tenth Circuit created in Dry Creek Lodge, Inc. v. Arapahoe and Shoshone Tribes, 623 F.2d 682 (10th Cir.1980), cert. denied, 449 U.S. 1118, 101 S.Ct. 931, 66 L.Ed.2d 847 (1981) (Dry Creek II). In Dry Creek, the plaintiffs alleged violations of their rights of due process and equal protection as guaranteed by the Indian Civil Rights Act. See Dry Creek Lodge, Inc. v. United States, 515 F.2d 926, 932-36 (10th Cir.1975) (Dry Creek I). The district court dismissed the original complaint for lack of jurisdiction because of sovereign immunity. On appeal, after concluding that the Indian Civil Rights Act waived the Tribe's sovereign immunity, the Tenth Circuit remanded the case for trial. Id.

While the case was in the district court on remand, the Supreme Court handed down its decision in Santa Clara. The district court then dismissed the case in reliance on Santa Clara. See, Dry Creek II, 623 F.2d at 683. Again the Tenth Circuit reversed. In Dry Creek, the plaintiffs had been denied access to the tribal courts. The Tenth Circuit distinguished the...