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Hobbs Straus successfully defended a former casino workers’ suit against a Tribe in a Tenth Circuit case finding absence of federal jurisdiction over non-Indian contract and tort disputes arising in Indian country. (2009)

GENERAL MEMORANDUM 11-089

GENERAL MEMORANDUM 11-089
Federal Court Upholds Tribal Sovereign Immunity Against NLRB Enforcement

On July 11, 2011, a judge in the U.S. District Court for the Western District of Oklahoma issued an order in the case Chickasaw Nation v. National Labor Relations Board (Chickasaw Nation), Case No. CIV-11-506-W, granting the Chickasaw Nation (Nation) an injunction that prevents the National Labor Relations Board (NLRB) from proceeding with hearings on a complaint against the Nation.

The dispute began in December 2010, when the International Brotherhood of Teamsters Union filed a complaint with the NLRB alleging that the Nation had engaged in unfair labor practices at its WinStar World Casino by preventing blackjack dealers from forming a union. The Nation responded that casino workers were employees of the Nation's executive branch and, therefore, that the NLRB had no jurisdiction over the complaints due to the Nation's treaties and principles of tribal sovereignty. Nonetheless, the NLRB combined the initial complaint with a second complaint, filed in early 2011, and scheduled a hearing for June 1, 2011. The Nation asked the federal court for an injunction that would bar the NLBR from holding that hearing.

Before the court could answer the question of whether or not to issue the injunction, it first had to decide whether it had jurisdiction to do so. The National Labor Relations Act (Act) generally gives the NLRB original jurisdiction over complaints of unfair labor practices, and strips federal district courts of their authority to hear such cases. The Act, first passed in 1935, makes no mention of Indian tribes. However, the NLRB argued that it had such authority nonetheless, tracing that authority through a series of federal court decisions.

The trail begins with the U.S. Supreme Court's 1960 decision in Federal Power Commission v. Tuscarora Indian Nation (Tuscarora), in which the Supreme Court, noting the broad language of the Federal Power Act, allowed the condemnation of tribal land for creation of a reservoir. Even though the Federal Power Act did not mention Indian tribes, the Supreme Court wrote that "a general statute in terms applying to all persons includes Indians and their property interests."

Next, the NLRB pointed to the 2007 San Manuel Indian Bingo & Casino v. National Labor Relations Board (San Manuel) decision in which the U.S. Court of Appeals for the District of Columbia Circuit relied on Tuscarora and upheld the NLRB's 2004 decision that Indian tribes can be "employers" under the Act, and that the NLRB had jurisdiction over the complaint against the tribal casino.

Finally, the NLRB pointed to Little River Band of Ottawa Indians v. National Labor Relations Board (Little River), decided just last year, in which a federal district court in Michigan rejected a similar request by a tribe to enjoin the NLRB hearing an unfair labor practices complaint lodged by the Teamsters. The court in Little River refused to issue an injunction and held that the Tribe first had to proceed through the NLRB's administrative process before it could appeal to the federal courts.

However, the court here rejected that line of argument. It pointed out that the U.S. Court of Appeals for the Tenth Circuit, which has jurisdiction over appeals coming out of Oklahoma and five other states, has rejected the broad interpretation that other courts have given Tuscarora. The Tenth Circuit reads Tuscarora as applying only to a tribe's property rights, and holds Congress may only infringe a tribe's sovereign rights through a clear and unequivocal expression in statute. This court found no such clear and unequivocal expression in the Act:

The Nation finds support for its argument in a deep body of Tenth Circuit law expressing extreme deference to tribal sovereignty. Because of the extraordinary number of tribes located within its jurisdiction, the Tenth Circuit is uniquely experienced in the application of the canons of Indian law. The Tenth Circuit has clearly held that "federal regulatory schemes do not apply to tribal governments exercising their sovereign authority absent express congressional authorization." Such Tenth Circuit authority is in accord with the United State Supreme Court's holding that before a treaty right will be abrogated, there must be a "clear and plain" expression of Congress' intention to do so. It is also in accord with the Supreme Court's pronouncement that a statute that is silent with respect to Indians does not divest a tribe of its sovereign authority.

(Internal citations omitted.) The court further wrote that the Nation's treaties, which allow the Nation to determine who is permitted to enter its territory, and to attach conditions to those allowed to enter the territory, were not abrogated by the NLRA. In this regard, the Chickasaw Nation decision is consistent with a long line of cases in which the Tenth Circuit has held that a tribe was not bound by a federal employment statute, including the Occupational Safety and Health Act (Donovan v. Navajo Forest Products Industries), the Age Discrimination in Employment Act (EEOC v. Cherokee Nation), and the National Labor Relations Act (NLRB v. Pueblo of San Juan). We note that the San Juan case was decided in 2002 before the DC Circuit's 2007 San Manuel decision. However, the San Juan court wrote extensively about the effect of the Tuscarora decision, and reached a different conclusion than that later reached by the San Manuel court.

Once the federal district court determined that it had jurisdiction, it found that the Nation had met the requirements for an injunction. The court determined that the Tenth Circuit's strong support of tribal sovereignty showed that the Nation was likely to succeed in its case. Furthermore, it found that the Nation would suffer irreparable harm from the infringement on its sovereignty, while the NLRB would suffer little or no harm from the injunction. Finally, the court found that the injunction would not harm the public interest, because there is a public interest in protecting and preserving tribal sovereignty.

We will monitor this case, should the NLRB appeal from the district court's order. In the meantime, please let us know if we may provide more information regarding this important development.

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Inquiries may be directed to:
William R. Norman (wnorman@hobbsstraus.com)
Dan Lewerenz (dlewerenz@hobbsstraus.com)
Chris Stearns (cstearns@hobbsstraus.com)
All at (405) 602-9425; except Chris at (202) 257-6428.

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