U.S. ex rel. Mosay v. Buffalo Bros. Management, Inc.

• Decision Date: 31 March 1994
• Docket Number: No. 93-3193,93-3193
• Citation: 20 F.3d 739
• Parties: UNITED STATES ex rel. Kenneth MOSAY, et al., Plaintiffs-Appellants, v. BUFFALO BROTHERS MANAGEMENT, INCORPORATED; Interstate Gaming Services, Incorporated; Roy C. Palmer; and Ronald G. Brown, Defendants-Appellees.
• Court: U.S. Court of Appeals — Seventh Circuit

Page 739

20 F.3d 739

62 USLW 2633

UNITED STATES ex rel. Kenneth MOSAY, et al., Plaintiffs-Appellants, v. BUFFALO BROTHERS MANAGEMENT, INCORPORATED; Interstate

Gaming Services, Incorporated; Roy C. Palmer;

and Ronald G. Brown, Defendants-Appellees.

No. 93-3193.

United States Court of Appeals, Seventh Circuit.

Argued Feb. 9, 1994.

Decided March 31, 1994.

Michael T. Brody (argued), Deirdre E. Connell, Jenner & Block, Chicago, IL, James E. Townsend, Steven J. Wells (argued), Michael E. Florey, Mark A. Jarboe, Dorsey & Whitney, Minneapolis, MN, for Kenneth Mosay.

Michael T. Brody, Deirdre E. Connell, James E. Townsend, Steven J. Wells, Michael E. Florey, Mark A. Jarboe, Garrison W. Kaufman, Dorsey & Whitney, Minneapolis, MN, for Mary Washington and Archie Mosay.

Jon G. Furlow, James R. Troupis (argued), Michael, Best & Friedrich, Madison, WI, for Buffalo Bros. Management, Inc., Interstate Gaming Services, Inc., Roy C. Palmer and Ronald G. Brown.

Anne Doris Noto, Tara A. Sher, Sonosky, Chambers, Sachse & Endreson, Douglas B.L. Endreson, Washington, DC, Howard Bichler, St. Croix Tribal Council, Hertel, WI, for St. Croix Chippewa Indians of Wisconsin, amicus curiae.

Before POSNER, Chief Judge, BAUER, Circuit Judge, and NORGLE, District Judge. ^*

POSNER, Chief Judge.

The plaintiffs, three members of the St. Croix Band of Chippewa Indians, appeal from the dismissal on the defendants' motion for summary judgment of their suit to void a contract between the defendants and the St. Croix Band and to recover on behalf of the tribe all the money the defendants have received from the tribe under the contract. The suit was filed in 1992 under 25 U.S.C. Sec. 81, which imposes various requirements on contracts with Indian tribes that involve payment "in consideration of services for ... Indians relative to their lands." The most important requirement is that such contracts be approved by the Bureau of Indian Affairs in the Department of the Interior. The statute authorizes the bringing of suits in the name of the United States to recover all money paid under contracts that violate the statute, with one half of the recovery going to the United States in trust for the tribe and the other half to the person bringing the suit. The statute does not specify who is eligible to bring such a suit--if the statute is read literally, anyone in the world is. Nor does it set forth standards to guide the Bureau of Indian Affairs in deciding whether to approve a contract.

The operation of gambling casinos on Indian reservations is a growing source of income for the tribes. Until 1988 (and perhaps for some period afterward, as we shall see), contracts between the tribes and the firms that actually operate the casinos, like all other contracts with Indian tribes relating to Indian lands (as these casino management contracts were held to be), were required by 25 U.S.C. Sec. 81 to be approved by the Bureau of Indian Affairs. Congress that year enacted the Indian Gaming Regulatory Act, 25 U.S.C. Secs. 2701 et seq., which establishes a three-member independent agency within the Department of the Interior--the National Indian Gaming Commission--to supervise Indian gambling. The Act confers on the Commission (or in some instances on the Chairman of the Commission, but we can ignore that complication) comprehensive authority over tribal ordinances or resolutions authorizing gambling and over contracts made by the tribes for the operation or management of their gambling establishments. Of particular relevance to this case, the Commission may not approve management contracts that do not satisfy a number of specific statutory criteria, Sec. 2711; and "management contract" is defined to include "all collateral agreements to such contract that relate to the gaming activity." Sec. 2711(a)(3). The authority heretofore exercised by the Bureau of Indian Affairs under 25 U.S.C. Sec. 81 with regard to Indian gambling contracts "is hereby transferred to the Commission," Sec. 2711(h), which is further authorized to levy and collect civil fines of up to $25,000 for any violations of the Act, regulations issued under it, or tribal ordinances or resolutions approved under it. Sec. 2713(a)(1). In addition the Commission is required to review all management contracts and tribal ordinances and resolutions (relating to gambling) adopted prior to October 17, 1988, the day the Act was passed, and to bring them into conformity with the Act by ordering them modified appropriately. Sec. 2712.

Congress must have anticipated some delay in the formation of the new National Indian Gaming Commission, for the Act provides that "until such time as the Commission is organized and prescribes regulations," the Bureau of Indian Affairs "shall continue to exercise those authorities vested in [it] on the day before October 17, 1988." Sec. 2709. But they probably did not anticipate that it would be almost five years before the Commission was up and running. In the interim the St. Croix Band signed two contracts with the defendants. The first was a contract with defendant Interstate to lease slot machines, the second a contract with defendant Buffalo Brothers under which the latter would manage the band's casino, which is located at Turtle Lake, Wisconsin. Both corporations are controlled by the two individual defendants, Palmer and Brown. The management contract was submitted to the Bureau of Indian Affairs, which approved it; whether in doing so the Bureau applied the criteria for approval established by the Indian Gaming Regulatory Act is unclear, although the contract recites that it is being made "pursuant to" that Act and the Bureau official who actually approved it said that his superiors had told him to use the Act's criteria and that he had done so. The other contract, the slot-machine lease, was not submitted to the Bureau because it is not a contract for services "relative to [Indian] lands" as that term has been interpreted in cases under 25 U.S.C. Sec. 81. It does not cede control over Indian lands to Interstate or even (what would be a kind of negative control) forbid the tribe to mortgage its lands. Altheimer & Gray v. Sioux Mfg. Corp., 983 F.2d 803, 811-12 (7th Cir.1993); Wisconsin Winnebago Business Committee v. Koberstein, 762 F.2d 613, 619 (7th Cir.1985); Barona Group v. American Management & Amusement, Inc., 840 F.2d 1394, 1403-04 (9th Cir.1987).

After the approval of the management contract, the casino was built with a substantial investment by Buffalo Brothers and is operating successfully, though the plaintiffs do not believe the tribe is getting its fair share of the profits. They argue that even though the National Indian Gaming Commission was not yet operational when the contracts were signed, the Indian Gaming Regulatory Act was fully applicable to them. The slot-machine lease, being a collateral agreement within the meaning of the Act, should therefore have been submitted to the Bureau of Indian Affairs for approval. They argue that since it was not, the management contract, which was submitted, was incomplete and so should not have been approved. They conclude that both contracts are void and that all the money that the defendants have received under them should be recovered in this suit and divided equally between the United States and the plaintiffs. The tribe itself apparently is content with the contracts. At all events it has dissociated itself from the suit, although the complaint is captioned as being filed "on behalf of the St. Croix Band of Chippewa Indians" and the plaintiffs have assigned in advance any recovery they may obtain in this suit, minus attorney's fees, to the tribe, while the statute itself requires that the share of the recovery going to the United States be held for the use of the tribe. We shall not have to determine whether the contracts are in fact disadvantageous to the tribe.

The principal issue is whether 25 U.S.C. Sec. 81 provides a remedy for violations of the Indian Gaming Regulatory Act, either generally or until the National Indian Gaming Commission went into operation, five years after the Act was passed. But there is a threshold issue of the plaintiffs' standing. Section 81 is a "qui tam" or, less politely, a bounty hunter's statute: it authorizes any person to sue to declare an Indian contract void and if he succeeds to be rewarded with half the money that the contractor had received under the contract. There is a question, unnecessary to decide in this case, whether Article III of the Constitution permits a federal court to entertain a qui tam suit brought by someone whose only stake in the suit is the bounty. It is one thing for Congress to offer bounties to law enforcers; that is little different from having salaried police and prosecutors. The offer of a bounty as of a salary can create an entitlement upon which a suit in federal court can be based without violation of Article III, Lujan v. Defenders of Wildlife, --- U.S. ----, ----, 112 S.Ct. 2130, 2143, 119 L.Ed.2d 351 (1992), since one deprived of a statutory right to a bounty has suffered the kind of injury that is a traditional basis for seeking legal redress. It is another thing for Congress to provide that anyone in the United States can sue to enforce the rights of anyone else. For those anyones who are suing to enforce the rights of others are by hypothesis persons who have not been injured themselves, and without an injury to oneself (or to one's members, if one is a membership organization) one has no standing to sue. Id., at ---- - ----, 112 S.Ct. at 2137-38; Valley Forge Christian College v. Americans United for Separation of Church & State, Inc., 454 U.S. 464, 473, 102 S.Ct. 752, 759, 70 L.Ed.2d 700 (1982). There is no standing to sue to redress injuries purely to another. Gladstone, Realtors v. Village of Bellwood, 441 U.S. 91, 100, 99 S.Ct. 1601, 1608, 60 L.Ed.2d 66 (1979); Village of Bellwood v. Dwivedi, 895 F.2d 1521, 1526 (7th Cir.199...