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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 11-120

General Memorandum 11-120
The U.S. Supreme Court Refuses to Review the Oneida Nation's Loss of Its Land Claim

On October 17, 2011, the United States Supreme Court refused to review the Oneida Nation land claim case. Justices Ginsburg and Sotomayor dissented; they thought the Court should review the case. The denial leaves standing the Second Circuit Court of Appeals decision, Oneida Indian Nation of N.Y. v. County of Oneida, which held that equitable considerations outlined in City of Sherrill v. Oneida Indian Nation ("Sherrill") and Cayuga Indian Nation Pataki ("Cayuga") barred the Oneidas' Nonintercourse Act and contracts-based claims.

This has brought to an end a case that the Supreme Court heard twice, in 1974 and 1985. The present case followed an earlier test case (involving 872 acres) called Oneida I, where the Supreme Court found that the Oneidas had properly pleaded a claim arising under federal law. Subsequently, in Oneida II, the Supreme Court determined that the Oneidas could properly maintain a cause of action for violation of their possessory rights to the treaty lands based on federal common law. While the Court in Oneida II recognized that a cause of action could be maintained, it noted that "the question whether equitable considerations should limit the relief available to the present day Oneida Indians" had not been addressed and expressed "no opinion as to whether other considerations may be relevant to the final disposition of [the] case," which it remanded for further proceedings. On remand of Oneida II, the test case, the district court awarded approximately $57,000 damages against the counties.

The present case, which was of the same type as the test case, but for a much larger acreage (250,000 acres), involves the Oneidas' land claim covering the period 1795 to 1846, during which New York State purchased the land from the Oneidas in defiance of the Nonintercourse Act. After the Second Circuit ruled in Cayuga that claims for possession of land were barred by the equitable considerations outlined in Sherrill, referred to as "laches," the Oneida pursued only money damages, based alternatively on trespass or contract. The trespass claim, based on violation of the Nonintercourse Act, was considered a "possessory" claim, and sought money damages for loss of use. The contract claim was considered a "non-possessory claim," and sought money damages to redress the unfair prices paid for the Oneidas' land.

While the District Court concluded Cayuga barred the Oneidas' possessory claims, but the non-possessory claims could be pursued, the Second Circuit Court of Appeals rejected all of the Oneidas' claims, both possessory and non-possessory, based on the Sherrill decision. The Second Circuit found that even the Oneidas' contract claim seeking to redress inadequate consideration for the lands "calls into question the validity of the original transfer of the subject lands and potentially, by extension, the ownership of those lands by non-Indian parties." The Second Circuit then concluded that since Cayuga recognized that claims with this characteristic threatened to undermine justified expectations as to ownership of the land, all of the Oneidas' money damage claims are subject to the equitable defenses allowed in Sherrill and Cayuga.

The Oneidas petitioned for Supreme Court review on two main points: (1) the Second Circuit's decision was in direct conflict with Oneida II, which the Oneidas pointed out upheld the counties' liability on a virtually identical claim, and (2) it is also irreconcilable with Congress's intent in the Indian Claims Limitation Act, 28 U.S.C. § 2415, under which the Oneida claim was still open to litigate in federal court. Further, they argued that not only did the Sherrill case expressly not disturb the holding in Oneida II, but it also emphasized the differences in the relief requested in the two cases: an award of money damages to remedy past wrongs (Oneida II) and (as the Oneidas were claiming at the time) restoration of tribal sovereignty and a permanent injunction against current and future property taxation (Sherrill).

The United States (also a party in the case on the same side as the Oneidas) argued in its Petition that the Supreme Court should review the Second Circuit's decision in the Oneida case because laches does not apply to suits by the United States, especially here, where the applicable statute of limitations preserved the claim. It also argued that the Second Circuit's decision is in conflict with the Supreme Court's Sherrill decision, which it posited was predicated on the difference between a monetary award and other types of awards that would be disruptive to the local non-Indian community.

The Supreme Court's surprising refusal to review makes final the Second Circuit's decision that all of the Oneidas' claims, whether possessory or non-possessory, are barred by equitable considerations. There is no doubt that the Second Circuit's ruling conflicts with parts of the Supreme Court's decision in Oneida II, which now must be regarded as severely restricted, if not in part overruled by implication. To prevail on an ancient land claim in the Second Circuit at least, a tribe will have to show not only that its lands were illegally taken by the state, but also that its situation is factually distinguishable from that of the Oneida and Cayuga Indian Nations, i.e. that its claims are not at all disruptive and the award of relief would not disrupt societal expectations. Moreover, the question of remedies may now be at the forefront of determining if any claim can survive.

Please contact us if you would like additional information about this case.

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Inquiries may be directed to:
Charlie Hobbs (chobbs@hobbsstraus.com)
Michael L. Roy (mroy@hobbsstraus.com)
Marsha K. Schmidt (mschmidt@hobbsstraus.com)
Jennifer P. Hughes (jhughes@hobbsstraus.com)

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