May 27, 2014

Supreme Court Decides Michigan v. Bay Mills Indian Community

On May 27, 2014, the U.S. Supreme Court decided Michigan v. Bay Mills Indian Community, a case involving the State of Michigan's efforts to stop the Bay Mills Indian Community from operating a casino outside of its reservation. The Court affirmed the lower court's decision, thus determining that sovereign immunity bars a state from suing in federal court to enjoin a tribe from violating the Indian Gaming Regulatory Act (IGRA) outside of Indian lands. This is a significant decision for tribal sovereignty.

Case Background

In 2010, the Bay Mills Indian Community (Bay Mills), a federally recognized Indian tribe, opened a casino in Vanderbilt, Michigan, more than 100 miles from the Bay Mills Reservation, on land purchased with funds received through the Michigan Indian Land Claims Settlement Act — land which the National Indian Gaming Commission later determined is not Indian lands. Shortly after the casino opened, the State of Michigan, as well as the Little Traverse Bay Band of Odawa Indians (Little Traverse), filed suit against Bay Mills in the Western District of Michigan. Both Michigan and Little Traverse claimed that Bay Mills' casino violated state and federal law, including IGRA. The district court entered a preliminary injunction ordering Bay Mills to cease operating the casino.

Bay Mills appealed the order in the Sixth Circuit Court of Appeals, which vacated the preliminary injunction and permitted Bay Mills to reopen the casino (Bay Mills opted to keep the casino closed pending the outcome of litigation). First, the Sixth Circuit found that the district court's authority only extends to IGRA claims involving casinos located on Indian lands. Second, the Sixth Circuit concluded that Bay Mills is immune from suit in federal court because Congress had not abrogated Bay Mills' tribal sovereign immunity nor had Bay Mills waived its tribal sovereign immunity (Kiowa Tribe of Oklahoma v. Manufacturing Technologies, Inc., 523 U.S. 751 (1998)). Michigan alone petitioned for Supreme Court review.

Implications for Tribal Sovereign Immunity

The Court decided that tribes enjoy sovereign immunity in suits involving gaming off Indian lands. The Court maintained the status quo by concluding that Congress has not clearly abrogated tribal sovereign immunity through federal law regarding IGRA-related claims, noting that IGRA only allows state suits against tribes, and thus jurisdiction over such suits, involving gaming on Indian lands. Thus, tribes will remain immune from suits regarding illegal gaming off Indian lands unless an individual tribe waives immunity or Congress changes IGRA to allow such suits. Though this ruling may alter the relationships between states and tribes, the Court left open alternative methods of stopping illegal tribal gaming off Indian lands: (1) waiver of tribal immunity through contract or compact, (2) injunctions against individual tribal officials, and (3) state law claims against individuals directly conducting the illegal gaming on non-Indian lands.

Concurrence and Dissent

The concurring opinion further detailed the history and comity against limiting tribes' sovereign immunity. The dissenting opinions would have overruled Kiowa, thus subjecting tribes to suits involving commercial activities conducted off Indian lands.

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