US v. Dakota, No. M84-246CA2.

CourtUnited States District Courts. 6th Circuit. United States District Court (Western District Michigan)
Writing for the CourtGarfield Hood, L'Anse, Mich., for Keweenaw Bay Indian Community
Citation666 F. Supp. 989
PartiesUNITED STATES of America and the State of Michigan, Plaintiffs, v. Frederick and Sybil DAKOTA, and the Keweenaw Bay Indian Community, Defendants.
Docket NumberNo. M84-246CA2.
Decision Date28 June 1985

666 F. Supp. 989

UNITED STATES of America and the State of Michigan, Plaintiffs,
v.
Frederick and Sybil DAKOTA, and the Keweenaw Bay Indian Community, Defendants.

No. M84-246CA2.

United States District Court, W.D. Michigan, N.D.

June 28, 1985.


666 F. Supp. 990

John A. Smietanka, U.S. Atty. by Daniel M. Laville, Asst. U.S. Atty., Grand Rapids, Mich., for U.S.

Frank J. Kelley, Atty. Gen. by Charles D. Hackney, Asst. Atty. Gen., Lansing, Mich., for State of Mich.

Garfield Hood, L'Anse, Mich., for Keweenaw Bay Indian Community.

Hunter H. Watson, Laurium, Mich., for Frederick and Sybil Dakota.

Jeanette Wolfley, Boulder, Colo., for Bay Mills Indian Community.

William Rastetter, Cedar, Mich., for Grand Traverse Band of Ottawa & Chippewa Indians.

Barry L. Levine, Michigan Indian Legal Services, Inc., Traverse City, Mich., for Bay Mills Indian Community.

OPINION AND JUDGMENT

MILES, Chief Judge.

This matter is before the Court on cross motions for summary judgment. On September 19, 1984 the United States and the State of Michigan brought a complaint for injunctive and declaratory relief against Frederick and Sybil Dakota and the Keweenaw Bay Indian Community requesting that the Dakotas be enjoined from operating a commercial gambling business, that the Keweenaw Bay Indian Community ("KBIC") be enjoined from issuing any "Commercial Gambling Licenses" to permit commercial gambling upon their federal reservation, and that the Court enter a declaratory judgment that commercial casino gambling on federal Indian reservations located within the State of Michigan is a violation of federal law.

The Bay Mills Indian Community and the Grand Traverse Band of Ottawa and Chippewa Indians were granted leave to appear as amici curiae. The State of Michigan was dismissed as a party plaintiff on November 27, 1984, but was granted leave to appear as amicus curiae.

The parties agreed that the facts in this case were not in dispute and that the matter could be resolved on cross motions for summary judgment. The parties filed three volumes of exhibits totalling 1378 pages and stipulated that they could be admitted into evidence and made a part of the record of this case.

A hearing was held in L'Anse, Michigan on March 1, 1985 for the purpose of hearing oral arguments on the cross motions for summary judgment. After a careful consideration of the briefs, oral arguments and exhibits, the Court renders the following opinion and order.

Facts

Defendant Keweenaw Bay Indian Community is duly organized under the Indian Reorganization Act, 48 Stat. 984 and exercises control over the L'Anse Reservation as defined by treaty dated September 30, 1854, 10 Stat. 1109. The KBIC is controlled by a constitution and by-laws which were approved by the Office of Indian Affairs of the United States Department of the Interior on December 17, 1936. The reservation encompasses approximately 50,000 acres and about 1,200 members of KBIC live on the reservation.

The governing body of the KBIC is the Tribal Council which consists of twelve tribal members, six of whom are elected to staggered three year terms by tribal electors residing in the L'Anse district and six elected to staggered three year terms by tribal electors residing in the Baraga district.

Each year the tribal council selects from its membership five officers — a president, a vice president, a secretary, an assistant secretary and a treasurer — who are known

666 F. Supp. 991
as the executive council. The council also selects such other officers and committees as may be necessary

Frederick and Sybil Dakota are individual members of the KBIC. Fred Dakota has been a Tribal Council member of fourteen years and served as Tribal Chairman from 1971-82 except for one year, and as Executive Director for the most part from 1974-82.

On April 18, 1983 the Dakotas entered into a contract with the KBIC to lease land owned by the United States government in trust for the KBIC. The Dakotas' intent to open a commercial gambling establishment on the land was known to the Tribal Council. The lease itself, however, contained no statement of purpose. The lease was approved by the Area Director of the Bureau of Indian Affairs on behalf of the Secretary of the Interior on April 29, 1983.

On December 31, 1983 defendants Fred and Sybil Dakota, both of whom are members of the KBIC, opened a bar and casino in a two car garage attached to a home owned by a relative and located within the boundaries of the L'Anse Federal Reservation.

The Tribal Code of the KBIC, approved by the Secretary of the Interior on October 17, 1974, recognized the right of the Tribal Council to issue gambling licenses to operate "a public place or device where a risk is taken on a chance of winning money or other valuable property."

On May 13, 1981 the Tribal Council of KBIC adopted a resolution enacting certain amendments to the Tribal Criminal Code which amendments prohibited gambling except for any activity conducted on the reservation pursuant to and in accordance with a license issued by the Tribal Council. The amendment called for two types of licenses: those available to persons or entities proposing to operate gaming or gambling operations on behalf or for the benefit of non-profit or charitable groups; and a license for persons or entities proposing to operate or maintain gaming or gambling operations for profit and not on behalf of charitable and non-profit groups.

The ordinance was approved by the Bureau of Indian Affairs, United States Department of the Interior; such approval was qualified to the extent that no approval was given to the undertaking of any specific types of gambling activities.

On January 17, 1984, the Tribal Council issued defendant Fred and Sybil Dakota a gambling license for gambling operations for profit pursuant to Code § 1.2077 as added by the amendments of May 13, 1981.

Defendants Fred and Sybil Dakota operated their bar and casino at the two car garage location and conducted gambling activity on a for-profit basis continuously (except on Sundays and possibly other brief hiatuses) until July 3, 1984.

In the spring of 1984 the Tribal Council conducted a non-binding plebicite among the tribal electors on the issue of whether licensed casino gambling was an acceptable activity on the reservation. Those who voted expressed their approval by a three to one margin.

On June 8, 1984, the KBIC, acting through its Tribal Council, entered into an amended business lease agreement with defendants Frederick and Sybil Dakota, leasing to the Dakotas a parcel of land consisting of approximately 1.16 acres and located in the southeasterly quadrant of the intersection of U.S. Highway 41 and Lakeshore Road in Baraga Township, Baraga County, Michigan and within the boundaries of the L'Anse Federal Reservation. The lease was to run for a term of twenty-five years commencing upon approval by the Secretary of the Interior and the lessee was given the option for renewing for a further term of not more than twenty-five years. The land in question was unimproved. The lease stated that the premises would be used for "such gaming activities as may be licensed on the premises."

The Secretary of the Interior's approval was given to the lease on June 13, 1984.

The KBIC, acting by resolution of its Tribal Council, gave its consent to assignment of the lessee's interest in the business lease to Superior National Bank and Trust Company, Baraga Branch, as security for repayment of funds loaned to defendants

666 F. Supp. 992
Fred and Sybil Dakota for the purpose of constructing a building and related improvements

Defendants Fred and Sybil Dakota retained the Tribal Construction Company, an asset of the KBIC, to construct a building to house the lounge and casino operations which they had been operating in the garage facility. The building was completed in time for operations to be moved and commenced on July 4, 1984.

Since July 4, 1984, defendants Fred and Sybil Dakota have operated, under the business name "The Pines," a lounge and gambling casino on a continuous basis (except Sundays and other possible brief hiatuses) at that facility; they, on a regular basis, employ more than five persons for the purpose of conducting the gambling aspects of their operation and have experienced in excess of $2,000 gross receipts from gambling operations as a result of at least one day's activities.

The Pines employs thirty-three persons, the majority of whom are tribal members. The patrons have included tribal members, residents of the State of Michigan, and residents of Illinois, Indiana, Wisconsin, Oklahoma and Oregon.

The gambling activities conducted at The Pines include blackjack, craps, poker and pull tabs.

Over the spring and summer of 1984 the Tribal Council of the KBIC studied the need for more detailed regulation relative to licensed gambling activity, and adopted Regulations 1 through 9 on August 6, 1984 ("Regulations"). These Regulations were not submitted to the Bureau of Indian Affairs, Department of the Interior, for review or approval.

The Regulations provide at paragraph 1.015 that until the Gambling Commission has been constituted, the Tribal Council of the KBIC shall discharge the functions of the Gambling Commission. The Gambling Commission was constituted on November 30, 1984. The Tribal Council continues to act as the Gambling Commission until such time as the Gambling Commission has organized itself and adopted the necessary operating procedures.

The Tribal Council, acting as the Gambling Commission, without taking any formal action, has authorized defendants Fred and Sybil Dakota to continue gambling activities on a for-profit basis at The Pines pursuant to the license issued on January 17, 1984. The Tribal Council's action equated the previous license to a commercial gambling license pursuant to paragraph 3.010 of Regulation 3.

While operating as commercial gambling licensees, defendants Fred and...

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4 practice notes
  • US v. Bay Mills Indian Community, No. M85-335CA.
    • United States
    • United States District Courts. 6th Circuit. United States District Court (Western District Michigan)
    • August 11, 1988
    ...the propriety of equitable relief was never raised or addressed in either the opinion of the lower court, see United States v. Dakota, 666 F.Supp. 989 (W.D.Mich.1985), nor the opinion of the Court of Appeals, I do not consider Dakota, either precedential or persuasive authority for granting......
  • Mashantucket Pequot Tribe v. State of Conn., No. 1841
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • September 4, 1990
    ...such as a state-operated lottery, bingo, jai alai and other forms of pari-mutuel betting." We recognize that United States v. Dakota, 666 F.Supp. 989, 997-1000 (W.D.Mich.1985), aff'd on other grounds, 796 F.2d 186 (6th Cir.1986), and United States v. Burns, 725 F.Supp. 116, 126 (N.D.N.Y.198......
  • U.S. v. Washington, No. 88-1908
    • United States
    • United States Courts of Appeals. United States Court of Appeals (6th Circuit)
    • July 26, 1989
    ...by private lotteries (such as cheating, fraud, and particularly the involvement of organized crime). Cf. United States v. Dakota, 666 F.Supp. 989, 998 (W.D.Mich.1985), aff'd, 796 F.2d 186 (6th Cir.1986). Michigan's sponsorship of a state lottery does not vitiate the state's legitimate objec......
  • Balogh v. Charron, Civ. No. 86-CV-72277-DT.
    • United States
    • United States District Courts. 6th Circuit. United States District Court (Western District Michigan)
    • August 31, 1987
    ...to be a legitimate requirement for the position. See Meeks, supra, at 423 ("it political patronage exception may refer only to the 666 F. Supp. 989 judge's secretary, the law clerks, and, possibly a court reporter or bailiff assigned exclusively to the judge.") (emphasis added). Under Brant......
4 cases
  • US v. Bay Mills Indian Community, No. M85-335CA.
    • United States
    • United States District Courts. 6th Circuit. United States District Court (Western District Michigan)
    • August 11, 1988
    ...the propriety of equitable relief was never raised or addressed in either the opinion of the lower court, see United States v. Dakota, 666 F.Supp. 989 (W.D.Mich.1985), nor the opinion of the Court of Appeals, I do not consider Dakota, either precedential or persuasive authority for granting......
  • Mashantucket Pequot Tribe v. State of Conn., No. 1841
    • United States
    • United States Courts of Appeals. United States Court of Appeals (2nd Circuit)
    • September 4, 1990
    ...such as a state-operated lottery, bingo, jai alai and other forms of pari-mutuel betting." We recognize that United States v. Dakota, 666 F.Supp. 989, 997-1000 (W.D.Mich.1985), aff'd on other grounds, 796 F.2d 186 (6th Cir.1986), and United States v. Burns, 725 F.Supp. 116, 126 (N.D.N.Y.198......
  • U.S. v. Washington, No. 88-1908
    • United States
    • United States Courts of Appeals. United States Court of Appeals (6th Circuit)
    • July 26, 1989
    ...by private lotteries (such as cheating, fraud, and particularly the involvement of organized crime). Cf. United States v. Dakota, 666 F.Supp. 989, 998 (W.D.Mich.1985), aff'd, 796 F.2d 186 (6th Cir.1986). Michigan's sponsorship of a state lottery does not vitiate the state's legitimate objec......
  • Balogh v. Charron, Civ. No. 86-CV-72277-DT.
    • United States
    • United States District Courts. 6th Circuit. United States District Court (Western District Michigan)
    • August 31, 1987
    ...to be a legitimate requirement for the position. See Meeks, supra, at 423 ("it political patronage exception may refer only to the 666 F. Supp. 989 judge's secretary, the law clerks, and, possibly a court reporter or bailiff assigned exclusively to the judge.") (emphasis added). Under Brant......

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