Paradigm Energy Partners, Llc v. Fox et al

MOTION to Dismiss for Lack of Jurisdiction and Memorandum in Support

D.N.D.August 22, 2016

IN THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF NORTH DAKOTA WESTERN DIVISION PARADIGM ENERGY PARTNERS, LLC, Plaintiff, vs. MARK FOX, in his official capacity as Chairman of the Tribal Business Council of the Mandan, Hidatsa & Arikara Nation: and CHIEF NELSON HEART, in his official capacity as Chief of Police for the Mandan, Hidatsa & Arikara Nation, Defendants. ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) ) MOTION TO DISMISS AND MEMORANDUM IN SUPPORT Case No. 1:16-CV-00304-DLH-CSM Judge Daniel L. Hovland Magistrate Judge Charles S. Miller, Jr. Defendants in this matter move to dismiss this matter under Federal Rule of Civil Procedure 12(b)(1), (2), (4), (6) and (7). 1. This Court lacks jurisdiction because Plaintiff has not pled a waiver of sovereign immunity. 2. This Court lacks jurisdiction because neither the Tribe nor the United States has waived the Tribe’s sovereign immunity applicable to this matter. 3. This Court lacks jurisdiction because Plaintiff has failed to exhaust tribal court remedies. 4. This Court lacks jurisdiction because Plaintiff has failed to join and is unable to join an indispensable party. 5. Plaintiff has not properly served either defendant and the Court therefore lacks personal jurisdiction over Defendants. Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 1 of 21 2 INTRODUCTION Plaintiff asks this court to sanction its failure to obtain required permits and authorizations for a segment of a pipeline under Lake Sakakawea.1 Instead of going back and correcting its errors, Plaintiff sought to convince the Mandan Hidatsa and Arikara Nation, Three Affiliated Tribes of the Fort Berthold Reservation (the “Tribe”) to tolerate Plaintiff’s failure to comply with applicable tribal and federal law and regulations law. When the Tribe refused (as any properly operating government would) Plaintiff brought the current suit through which it incorrectly seeks to have this Court order that Plaintiff can complete the segment of the pipeline. Plaintiff’s primary basis for asking this Court to rescue Plaintiff’ error is Plaintiff’s claim that it will suffer economic harm. Plaintiff cites various contracts, business plans, investments, and financial consequences which it claims are dependent upon resuming unauthorized construction the very next workday after it filed its complaint in this Court. As Plaintiff’s own complaint suggests, Plaintiff’s litigious approach to this matter is unnecessary and misguided. Plaintiff is not the real party in interest for the claims stated in the Complaint. The real party in interest is Sacajawea Pipeline Company LLC, an entity in which plaintiff does not have an ownership interest. An affiliate of Plaintiff, Paradigm Pipeline LLC, owns 88% of the interests in Sacajawea Pipeline Co, while Grey Wolf Midstream, LLC holds 12%.2 The Plaintiff also mischaracterizes the Tribe’s interests in this matter. The Tribe and Plaintiff have an interest in construction proceeding only after the real party in interest submits to 1 The segment of the pipeline that is at issue is not solely under Lake Sakakawea. It also includes the segments of the pipeline which would be below ground on both sides of the river as well as adjacent to Lake Sakakawea. That then indisputably includes Indian lands which are not under Lake Sakakawea. 2 Grey Wolf Midstream is an LLC wholly owned by Missouri River Resources. Missouri River Resources is a corporate entity created under tribal law and wholly owned by the Tribe. Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 2 of 21 3 all regulatory oversight and review and obtains all required permits and authorizations. Ignoring that properly identified interest, Plaintiff asserted to the Tribe that because the Tribe would, at least in the short term, profit from the construction of the pipeline, the Tribe should not complain about Plaintiff’s failure to comply with applicable regulatory law; e.g. Complaint 46 47; and Plaintiff now asserts to this Court that because the Tribe would profit from Plaintiff’s skirting of regulatory requirements, this Court should permit Plaintiff to proceed without proper approval. There are numerous problems with Plaintiff’s suit and with its request for a temporary restraining order. This Court cannot issue a temporary restraining order in a case over which it lacks jurisdiction; and this Court plainly does not have jurisdiction over the present suit. For Plaintiff’s claim against the Tribe, through tribal officers, this Court cannot exercise jurisdiction because, as Plaintiff admits, it has not exhausted tribal court remedies. This Court also does not have before it the necessary parties, nor does it have any controversy between the parties who are in this suit. Because this case does not even clear that threshold requirement, the Court would not even proceed to the four factor test for injunctive relief, which would redundantly show that the injunctive relief is not permitted. Plaintiff will not prevail on the merits of this case,3 and the public interest and balancing of interests does not support Plaintiff’s attempt to continue construction without legally required permits and authorizations. 3 Plaintiff’s primary theory is that because the United States Department of the Army approved a right of way, Plaintiff does not need a right of way from the Tribe for invasion of the Tribe’s property rights. There is no legal basis for Plaintiff’s claim, and Plaintiff is merely blustering in an attempt to get around its own failure to obtain the required consent and right of way. Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 3 of 21 4 DISCUSSION OF LAW I. MOTION TO DISMISS STANDARD A. MOTION TO DISMISS UNDER FRCP 12(B)(1) A motion to dismiss pursuant to Federal Rule of Civil Procedure (FRCP) 12(b)(1) challenges a court’s subject matter jurisdiction. It is fundamental that a case must be dismissed for lack of jurisdiction unless Plaintiff meets its burden to establish subject matter jurisdiction. Kokkenen v. Guardian Life Ins. Co. of America, 511 U.S. 375, 377 (1994); Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 94 (1998); Osborn v. United States, 918 F.2d 724 (8th Cir. 1990). In considering a motion to dismiss under Rule 12(b)(1), the court is not limited to the facts pled in the complaint, but can and should weigh evidence and determine facts in order to satisfy itself as to its power to hear the case. Osborn v. United States, 918 F.2d 724 (8th Cir. 1990); Roberts v. Corrothers, 812 F.2d 1173, 1177 (9th Cir. 1987). B. MOTION TO DISMISS UNDER FRCP 12(B)(6) A motion to dismiss pursuant to a FRCP 12(b)(6) is a challenge to the basis upon which a plaintiff seeks relief and a plaintiff’s is required to provide “more than labels, conclusions, and formulaic recitations of the elements of a cause of action” in order to survive such challenge. Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 555 (2007). C. MOTION TO DISMISS UNDER FRCP 12(B)(7) Under FRCP 12(b)(7), a complaint must be dismissed if it fails to join an indispensable party under FRCP 19. Courts must consider (1) whether a party is “necessary” under Rule 19(a). This inquiry involves whether the court can accord “‘complete relief’ … among existing parties” or “whether the absent party has a ‘legally protected interest’ in the subject of the suit” that will be impaired or impeded. Shermoen v. United States, 982 F. 2d 1312, 1317 -18 (9th Cir. 1992). Court must next determine (2) whether the necessary party can be joined, and if it cannot be joined, Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 4 of 21 5 (3) whether that party is indispensable such that in “equity and good conscience,” the case must be dismissed. Id. This inquiry is “’a practical one and fact specific,’” and considers prejudice to the existing and absent parties. Id. at 1317 (quoting Makah Indian Tribe v. Verity, 910 F.2d 555, 558 (9th Cir. 1990); FRCP 19(b)). II. THE COURT LACKS SUBJECT MATTER JURISDICTION BECAUSE DEFENDANTS ARE CLOAKED WITH SOVEREIGN IMMUNITY Tribal sovereign immunity is a matter of subject matter jurisdiction which can be challenged in a motion to dismiss for lack of subject matter jurisdiction. FRCP 12(b)(1). Hagen v. Sisseton-Wahpeton Community College, 205 F.3d 1040, 1043 (8th Cir. 2000) (citing Rupp v. Omaha Indian Tribe, 45 F.3d 1241, 1244 (8th Cir. 1995)). It is not a discretionary doctrine that may be applied as a remedy depending on the equities of a given situation; rather it presents a pure jurisdictional question. Waivers of tribal sovereign immunity are strictly construed, and there is a strong presumption against them. C & L Enters., Inc. v. Citizen Band Potawatomi Indian Tribe of Okla., 532 U.S. 411, 418 (2001). This immunity is so powerful that courts have held there can be no “waiver of tribal immunity based on policy concerns, or perceived inequities arising from the assertion of immunity, or the unique context of a case.” Pan Am. Co. v. Sycuan Band of Mission Indians, 884 F. 2d 416, 419 (9th Cir. 1989), overruled on other grounds, C & L Enters., Inc. 532 U.S. 411, 418 (2001) (citations omitted). Indian tribes enjoy the same immunity from suit enjoyed by sovereign powers and are “subject to suit only where Congress has authorized the suit or the tribe has waived its immunity.” Kiowa Tribe of Okla. v. Mfg. Techs., Inc., 523 U.S. 751, 754 (1998); Oklahoma Tax Comm. v. Citizen Band of Potawatomi Indian Tribe, 498 US. 505, 509 (1991). “To abrogate tribal immunity, Congress must ‘unequivocally’ express that purpose,” and “to relinquish its immunity, a tribe's waiver must be ‘clear.’” C & L Enters., Inc. v. Citizen Band Potawatomi Indian Tribe of Okla., Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 5 of 21 6 532 U.S. 411, 418 (2001) (citations omitted). A waiver of sovereign immunity “cannot be implied but must be unequivocally expressed.” United States v. Testan, 424 U.S. 392, 399 (1976)(quoting United States v. King, 395 U.S. 1, 4 (1969); Sac and Fox Nation v. Honorable Orvan J. Hanson, Jr. et al., 47 F.3d 1061 (10th Cir. 1995). Plaintiff mistakenly contends that it can evade sovereign immunity by naming the individual officers through whom the tribal sovereign acts. Courts uniformly hold that because sovereign immunity is a substantive protection, it is not defeated by such pleadings. A suit is against the sovereign if “the judgment would expend itself on the public treasury or domain, or interfere with the public administration… or if the effect of the judgment would be “to restrain the government from action, or to compel it to act.” Coggeshall Develop. Corp. v. Diamond, 884 F.2d 1, 3 (1st Cir. 1989). A suit will fail, as one against the sovereign, even if it is claimed the officer acted unconstitutionally or beyond his statutory powers, if the relief requested cannot be granted by merely ordering the cessation of the conduct complained of but will require affirmative action by the sovereign or the disposition of unquestionably sovereign property. Johnson v. Matthews, 539 F.2d 1111, 1124 (8th Cir. 1976). Here, the actions at issue are those of the sovereign, not of the individual officers. It is the Tribe, through its governing body, that directed that a cease and desist order be issued; and the present suit seeks to have the Tribe rescind that tribal legislative directive. The named officers merely took the actions required of them by the sovereign. A lawsuit against officials acting within their official capacity is nothing more than a claim against the entity. Brandon v. Holt, 469 U.S. 464, 471-72 (1985); Epps v. Duke Univ., Inc. 447 S.E.2d 444, 447; Mullis v. Sechrest, 495 S.E.2d 721, 725 (1998). Immunity from suit for a tribe also applies to tribal officials. Fletcher v. United States, 116 F.3d 1315, 1324 (10th Cir. 1997); Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 6 of 21 7 Linneen v. Gila River Indian Community, 276 F.3d 489, 492 (9th Cir. 2002), cert. den., 236 U.S. 939 (2002). Sovereign immunity even extends to “sub-entities or enterprises of a tribe.” Native Am. Distrib. v. Seneca-Cayuga Tobacco Co., 491 F. Supp. 2d 1056, 1064 (N.D. Okla. 2007), aff’d 546 F.3d 1288 (10th Cir. 2008). Tribal sovereign immunity extends to individual officers of a tribe named as parties: It is clear that a plaintiff may not avoid the operation of tribal immunity by suing tribal officials; “the interest in preserving the inherent right of self-government in Indian tribes is equally strong when suit is brought against individual officers of the tribal organization as when brought against the tribe itself.” Accordingly, a tribe’s immunity generally immunizes tribal officials from claims made against them in their official capacities…. The general bar against official-capacity claims, however, does not mean that tribal officials are immunized from individual capacity suits arising of actions they took in their official capacities, as the district court held…. Rather, it means that tribal officials are immunized from suits brought against them because of their official capacities – that is because the powers they possess in those capacities enable them to grant the plaintiffs relief on behalf of the tribe. Native Am. Distrib. at 1296 (footnote and citations omitted). The analysis requires a court to “ask whether the sovereign “is the real and substantial party in interest.” Id. at 1296 (quoting Frazier v. Simmons, 254 F.3d 1247, 1253 (10th Cir. 2001)). Such answer “turns on the relief sought by the plaintiffs.” Id. at 1297. The rule is “relief sought nominally against an officer is in fact against the sovereign if the decree would operate against the latter.” Id. (quoting Pennhurst State School & Hosp. v. Halderman, 465 U.S. 89, 101 (1984)). The Supreme Court has expressly rejected the application of equitable considerations in the context of tribal sovereign immunity. Three Affiliated Tribes v. Wold Eng’g, 476 U.S. 877, 893 (1986) (“the perceived inequity of not allowing suit against an Indian tribe ‘simply must be accepted in view of the overriding federal and tribal interests in these circumstances.’”) thus “the requirements that a waiver of tribal immunity be ‘clear’ and unequivocally expressed’ is not a Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 7 of 21 8 requirement that may be flexibly applied or even disregarded based upon the parties or the specific facts involved.” Ute Distribution Corp. v. Ute Indian Tribe, 149 F.3d 1260, 1267 (10th Cir. 1998). In this case, Plaintiff has attempted to evade the Tribe’s immunity by including claims against the individual officers. However, what is clear from the Complaint is Plaintiff would need relief from the legislative action. Such relief would clearly be against the Tribe. Accordingly, Plaintiff’s pleading device of suing individual commissioners in their official capacity should be soundly rejected. III. THIS CASE MUST BE DISMISSED BECAUSE PLAINTIFF FAILED TO EXHAUST TRIBAL REMEDIES The next issue the Court must address is whether this action should be dismissed for lack of jurisdiction for failure to exhaust tribal remedies. Tribes have the following indisputable jurisdiction over non-Indians: A tribe may regulate, through taxation, licensing, or other means, the activities of nonmembers who enter consensual relationships with the tribe or its members, through commercial dealing, contracts, leases or other arrangements. A tribe may also retain inherent power to exercise civil authority over the conduct of non- Indians on fee lands within its reservation when that conduct threatens or has some direct effect on the political integrity, the economic security, or the health or welfare of the tribe. Montana v. United States, 450 U.S. 544, 565-66 (1981). “A tribe’s sovereign power to regulate reservation resources continues to exist unless divested by Congress. Id. (citing United States v. Wheeler, 435 U.S. 313, 322-23 (1978); see also Felix S. Cohen’s Handbook of Federal Indian Law 230-32 (1982 ed.)). The general rule is that a federal district court cannot proceed with a suit challenging the Tribe’s jurisdiction until the would-be federal court Plaintiff has fully and finally exhausted tribal remedies: Congress is committed to a policy of supporting tribal self-government and self- determination. That policy favors a rule that will provide the forum whose jurisdiction is being challenged the first opportunity to evaluate the factual and legal bases for the challenge….Exhaustion of tribal court remedies, moreover, will Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 8 of 21 9 encourage tribal courts to explain to the parties the precise basis for accepting jurisdiction, and will also provide other courts with the benefit of their expertise in such matters in the event of further judicial review. Nat’l Farmers Union Ins. Cos. v. Crow Tribe of Indians, 471 U.S. 845, 856 (1985). It is settled law that civil jurisdiction over tribal-related activities on tribal land presumptively lies in the tribal system, Duncan Energy Co. v. Three Affiliated Tribes of Ft. Berthold Reservation, 27 F.3d 1294, 1299 (8th Cir. 1994), and "exhaustion is required before such a claim may be entertained by a federal court." Nat’l Farmers Union, 471 U.S. at 857 (emphasis added). See also Iowa Mutual Ins. Co. v. LaPlante, 480 U.S. 9, 18 (1987) ("Federal policy . . . directs a federal court to stay its hand."); Krempel v. Prairie Island Indian Community, 125 F.3d 621 (8th Cir. 1997); Burlington Northern Railroad Company v. Crow Tribal Council, 940 F.2d 1239, 1245 (9th Cir. 1991) ("[P]roper respect . . . requires" tribal remedy exhaustion.) (emphasis added) (citing LaPlante). Not only is exhaustion of tribal remedies mandated by Supreme Court precedent, but it is also decreed by the clear weight of authority from the Eighth Circuit Court of Appeals. In Duncan Energy, the Court held that National Farmers Union and LaPlante require exhaustion of tribal remedies before a case may be considered by a federal district court. 27 F.3d at 1300. In so holding, the Court cited City of Timber Lake v. Cheyenne River Sioux Tribe, 10 F.3d 554 (8th Cir. 1993) (recognizing tribal court authority under tribal constitution to exercise jurisdiction over non- Indian operators of liquor establishments on fee-patented land in cities within reservation, and therefore tribal remedies must be exhausted prior to the exercise of jurisdiction by a federal district court); United States ex rel. Kishell v. Turtle Mountain Hous. Auth., 816 F.2d 1273, 1276 (8th Cir. 1987) ("A federal court should stay its hand until tribal remedies are exhausted and the tribal court has had a full opportunity to determine its own jurisdiction."); N.W. S.D. Prod. Credit Ass'n v. Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 9 of 21 10 Smith, 784 F.2d 323 (8th Cir. 1986) (holding that tribal court is the appropriate forum to decide the reach of tribal jurisdictional in the first instance). In fact, most circuits considering this issue have concluded that National Farmers Union and LaPlante "established an inflexible bar to considering the merits of a petition by the federal court, and therefore requiring that a petition be dismissed when it appears that there has been a failure to exhaust [tribal remedies]," Smith v. Moffet, 947 F.2d 442, 445 (10th Cir. 1991), and that the "requirement of exhaustion of tribal remedies is not discretionary, it is mandatory. If deference is called for, the district court may not relieve the parties from exhausting tribal remedies." Crawford v. Genuine Auto Parts, Co., 947 F.2d 1405, 1407 (9th Cir. 1991), cert. denied, 502 U.S. 1096 (1992). Finally, disputes arising on the reservation, as this one did, that raise questions of tribal law and jurisdiction, as this one does, must first be addressed in the tribal court. Weeks Constr., Inc. v. Oglala Sioux Hous. Auth., 797 F.2d 668 (8th Cir. 1986). The tribal exhaustion requirement applies even in cases where tribal jurisdiction is not clearly established. Instead, in cases where even a “colorable question” of tribal jurisdiction exists, principles of comity require that the federal court abstain and require the plaintiff to exhaust tribal remedies. Stock West Corp. v. Taylor, 964 F.2d 912, 920-21 (9th Cir. 1992). The Court in National Farmers Union went on to explain that: [T]he existence and extent of a tribal court’s jurisdiction will require a careful examination of tribal sovereignty, the extent to which that sovereignty has been altered, divested, or diminished, as well as a detailed study of relevant statutes, Executive Branch policy as embodied in treaties and elsewhere, and administrative or judicial decisions. Id. at 855-56. While not foreclosing the possibility that the issue of a tribal court’s jurisdiction over non-Indians could become a federal question at some point, the National Farmers Union court decreed that the “careful examination” described above is the prerequisite to that federal question being presented. But in the present case Plaintiff filed this action in federal court without Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 10 of 21 11 even seeking a tribal court decision related to the allegedly improper actions of the tribal officers. Therefore, there is no Tribal Court action exceeding federally imposed limits on Tribal Court jurisdiction, there is no record for purposes of federal review, and there is no federal question upon which to base jurisdiction at this time. This rule, known as the exhaustion rule, is based upon “the Federal Government's longstanding policy of encouraging tribal self-government.” Iowa Mutual Ins. Co. 480 U.S. at 14; Id. at 19 (“tribal courts play a vital role in tribal self-government, and the Federal Government has consistently encouraged their development”); Duncan Energy Co. 27 F.3d at 1299; Weeks Constr., Inc., 797 F.2d 668. One of the primary purposes of exhaustion is to permit the tribal law-applying entities to develop the factual record from which legal conclusions concerning jurisdiction can flow. Iowa Mutual Ins. Co., 480 U.S. at 19. Once a Tribe has created a factual record and issued a final ruling based upon it, a party can seek federal review of the final Tribal Court decision on the federal law issues related to jurisdiction. “[O]n review, the district court must first examine the Tribal Court's determination of its own jurisdiction. . . . “[I]n making its analysis, the district court should review the Tribal Court's findings of fact under a deferential, clearly erroneous standard.” Duncan Energy Co., 27 F.3d at 1300, citing FMC v. Shoshone-Bannock Tribes, 905 F.2d 1311, 1313 (9th Cir. 1990) (emphasis added). The first federal appellate court to reach the issue, the Ninth Circuit, explained that “[T]he Farmers Union Court contemplated that tribal courts would develop the factual record in order to serve the “orderly administration of justice in the federal court.” FMC, 905 F.2d at 1313. All federal courts which have reached the issue, including the Eighth Circuit Court, have adopted the Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 11 of 21 12 Ninth Circuit’s analysis on this issue of law. Duncan Energy Co., 27 F.3d at 1300 (citing FMC); Mustang Prod. Co. v. Harrison, 94 F.3d 1382 (10th Cir. 1996) (citing FMC). Here, as discussed above, there is no “Tribal Court determination of its own jurisdiction” to review, and therefore there is not yet a federal question to present. And as discussed above, the facts necessary to determine whether or not the Tribe has jurisdiction have not been developed, and are not even alleged in Plaintiff’s federal court complaint. The only possible federal question is whether the Tribe has exceeded its lawful jurisdiction based upon the Montana test. Under Osborn v. United States, 918 F.2d 724 (8th Cir. 1990), Defendants challenge Plaintiff’s claim of jurisdiction both on the pleadings and, if Plaintiff were to survive that challenge, then on the facts. There are two “Montana exceptions”. The first Montana exception applies where a party has entered into a consensual relationship with the Tribe or its members. Montana, 450 U.S. at 565-66. Here, as Plaintiff is required to admit in its own complaint, it has entered into multiple consensual relationships with the Tribe related to the pipeline. It is, therefore, subject to tribal regulation regarding the portions of the pipeline on the Reservation. The second Montana exception applies where the alleged “conduct threatens or has some direct effect on the political integrity, the economic security, or the health or welfare of the tribe.” Montana, 450 U.S. at 565-66. The Tribe has much more than a colorable basis for asserting that construction of a pipeline on tribal land and under the Missouri River without required regulatory oversight and approval threatens the health and welfare of the Tribe. Therefore, tribal forum must be afforded opportunities to determine its own jurisdiction and no court should exercise jurisdiction until the parties have exhausted their Tribal remedies. Kaul v. Wahquahboshkuk, 838 F. Supp. 515, 516 (D. Kan. 1993). Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 12 of 21 13 In Kaul, the determination of whether tribal courts have jurisdiction over a civil case was required to be made by the tribal court itself; a plaintiff "is not able to escape the exhaustion doctrine by sitting on her tribal remedies." Kaul, supra, 838 F. Supp. at 517. In Kaul, the court dismissed the plaintiff's claim for lack of subject matter jurisdiction, stating: "the better course is to dismiss the plaintiff's suit so that she can pursue her tribal remedies." Id., at 518. The rule of "tribal exhaustion" requires that this action be dismissed so the issue of jurisdiction may properly be decided in the tribal court. This Court should dismiss Plaintiff’s complaint as Plaintiff wholly failed to exhaust its tribal court remedies. As a matter of comity, federal courts may not exercise jurisdiction in an action until the plaintiff exhausts tribal remedies. Iowa Mutual, 480 U.S. at 18; National Farmers, 471 U.S. 845. It is inappropriate for the federal court to address plaintiff’s claims where plaintiff has not exhausted tribal remedies. Davis v. Mille Lacs Band of Chippewa Indians, 193 F.3d 990, 992 (8th Cir. 1999); Stock West, supra, 964 F.2d at 920 (9th Cir. 1992). IV. PLAINTIFF HAS FAILED TO JOIN THE THREE AFFILIATED TRIBES, WHICH IS A NECESSARY AND INDISPENSABLE PARTY THAT CANNOT BE JOINED BECAUSE OF SOVEREIGN IMMUNITY. A. THE TRIBE IS A NECESSARY PARTY The framework for determining whether a party is necessary is FRCP 19. An absent party is necessary under FRCP 19(a) if any one of the following factors are met: (1) the party “claim[s] an interest relative to the subject of the action and is so situated that the disposition of the action in the [party’s] absence may … as a practical matter impair or impede the [party’s] ability to protect that interest;” or (2) the court cannot, without the absent party, accord complete relief among the existing parties; or (3) an existing party is left subject to a substantial risk of incurring multiple or inconsistent obligations in the absent party is not joined. FRCP 19(a). If just one of these criteria are satisfied, the Three Affiliated Tribes is a necessary party. Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 13 of 21 14 “Rule 19, by its plain language, does not require that the absent party to actually possess an interest; it only requires the movant to show that the absent party claims an interest relating to the subject of the action.” Citizen Potawatomi Nation v. Norton, 248 F.3d 993, 998 (10th Cir. 2001) (citing Shermoen, 982 F.2d at 1318 and David v. United States, 192 F.3d 951 (10th Cir. 1999) (citations omitted). “Consequently, Rule 19 excludes only those claimed interests that are ‘patently frivolous.’” Id. “It is the party’s claim of a protectable interest that makes its presence necessary.” American Greyhound Racing, Inc. v. Hull, 305 F.3d. 1015, 1024 (9th Cir. 2002)(emphasis added)(citing Shermoen v. U.S., 982 F.2d 1312, 1317 (9th Cir. 1992), cert. denied, 590 U.S. 903 (1993)). In the present case, the Three Affiliated Tribes claim a sovereign interest relating to the subject of the action, and is so situated that the disposition of the action in the Tribe’s absence may as a practical matter impair or impede the Tribe’s ability to protect that interest. The Tribe has a legally protectable interest in the outcome of this case including the Tribe’s ability to execute or impose tribal law on parties such as Plaintiff that are engaged in activity regulated by tribal law. In this case, the Cease and Desist Order was signed and delivered pursuant to official action of the Tribal Business Council. Plaintiff’s Complaint, Exhibit 1; see Defendants’ Exhibit A attached hereto. The named Defendants here were simply carrying out the directives of the Tribe’s governing body, the Tribal Business Council. Further, the Cease and Desist Order itself states the grounds upon which it was issued, and also gave the parties (who are not named plaintiffs here) the right to request a hearing. The Tribe’s interest in making and enforcing its own laws is clearly and directly implicated here. Attacks on the Tribe’s ability to regulate activity on the Reservation and challenges to the Tribe’s ability to impose its laws on reservation activity is paramount to the Tribe. Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 14 of 21 15 B. THE TRIBE ENJOYS SOVEREIGN IMMUNITY AND CANNOT BE JOINED Although the Tribe is a necessary party under FRCP 19(a), it cannot be joined as a party because it enjoys tribal sovereign immunity which has not been waived. See, supra, Shermoen, 982 F.2d at 1318 (Even if a tribe is a required party, it cannot be involuntarily joined “due to [the tribe’s] sovereign immunity.”) Because the Tribe cannot be joined, the court must determine if the Tribe is indispensable to the lawsuit under the FRCP 19(b) factors. C. THE THREE AFFILIATED TRIBES IS AN INDISPENSABLE PARTY The Tribe is an indispensable party if, “in equity and good conscience,” the court should not allow the action to proceed in its absence. FRCP 19(b). The courts balance four factors in making the indispensability determination: (1) prejudice to any party or to the absent party; (2) whether relief can be shaped to lessen prejudice; (3) whether an adequate remedy, even if not complete, can be awarded without the absent party; and (4) whether there exists an alternative forum. Kescoli v. Babbitt, 101 F.3d 1304, 1310-1311 (9th Cir. 1996). “If the necessary party is immune from suit, there may be very little need for balancing Rule 19(b) factors because immunity itself may be viewed as the compelling factor.” Kescoli, 101 F.3d at 1311; Confederated Tribes of the Chehalis Indian Reservation v. Lujan, 928 F.2d 1496, 1499 (9th Cir. 1991). “In many cases in which we have found that an Indian tribe is an indispensable party, tribal sovereign immunity has required dismissal of the case.” Peabody W. Coal Co., 400 F.3d at 781 (citing Dawavendewa, 276 F.3d at 1163; Am. Greyhound Racing, Inc., 305 F.3d at 1027. 1. First Indispensability Factor: Prejudice to any party or to the absent party. In Greyhound supra, the Court examined FRCP 19(b) and the Court held that “the first factor of prejudice, insofar as it focuses on the absent party, largely duplicates the consideration that made a party necessary under Rule 19(a): a protectable interest that will be impaired or Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 15 of 21 16 impeded by the party’s absence.” Greyhound, 305 F.3d at 1024-25 (citing Dawavendewa v. Salt River Project Ag. Improvement Power Dist, 276 F.3d 1150, 1162 (9th Cir. 2002) and Confederated Tribes of the Chehalis Indian Reservation v. Lujan, 928 F.2d 1496, 1499 (9th Cir. 1991)). Furthermore, “plaintiffs may not do indirectly what they cannot do directly. Plaintiffs cannot get relief from [defendants] that implicates the interests of parties with sovereign immunity.” Timbisha, 2003 WL 25897083 at 6 (E.D. Cal.) (citing Pit River Home & Agr. Coop. Ass’n v. United States, 30 F.3d at 1088, 1097-1103 (9th Cir. 1994)). In this case, it would be prejudicial to proceed without the Tribe because the heart of this case is whether Plaintiff is subject to the Tribe’s cease and desist directive for its activities on tribal lands. Thus, the Tribe would be prejudiced if the case were to proceed in its absence. 2. Second Indispensability Factor: The extent to which, by protective provisions in the judgment, by the shaping of relief, or other measures, the prejudice can be lessened or avoided. With respect to the second factor, courts have generally found that where tribal interests are at stake, any decision adverse to the Tribe, no matter how it is framed, will be prejudicial. See Pit River Home, 30 F.3d at 1102. Accordingly, relief cannot usually be shaped to minimize the prejudice. This is especially so where the Tribe’s ability to adequately govern its affairs is implicated. E.g., Lucero, 788 F. Supp. at 1183; Village of Hotvela Traditional Elders v. IHS, 1 F. Supp. 2d 1022, 1030 (D. Ariz. 1997), aff’d, 141 F.3d 1182 (9th Cir. 1998), cert. denied, 525 U.S. 1107 (1999); Quileute Indian Tribe v. Babbitt, 18 F.3d 1456, 1460-61 (9th Cir. 1994). Similarly, because judgments are not binding on tribal entities, courts have been more willing to find that adequate relief cannot be afforded without the tribal party’s joinder. Pit River Home, 30 F.3d at 1102; Lucero, 788 F. Supp. at 1133; Davis v. U.S., 199 F. Supp. 2d at 1177. It is impossible to shape relief or provide other measures that will lessen or avoid prejudice against the interests of the Tribe. The relief requested in Plaintiff’s Complaint is for a declaration Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 16 of 21 17 that the Tribe cannot direct Plaintiff to cease its unlawful and unauthorized actions on tribal lands. A suit that asks a federal court to diminish the exercise of the Tribe’s sovereign power within its boundaries is inherently prejudicial, and there is no way to shape relief to avoid affecting the Tribe’s sovereign interest. 3. Third Indispensability Factor: Whether a judgment rendered in the person's absence will be adequate. This lawsuit seeks to have the federal court countermand the action of the Tribe’s governing body. A judgment against the named Defendants, the Tribe’s Chairman and the Chief of Police, would not be a judgment against the Tribe itself. Any type of injunctive relief in the Tribe’s absence would result in the above-described prejudice to the Tribe. In any event, the adequacy factor “cannot be given dispositive weight when the efficacy of the judgment would be at the cost of the absent parties’ rights to participate in litigation that critically affects their interests.” Wichita & Affiliated Tribes of Oklahoma v. Hodel, 788 F.2d 765,777 (D.C. Cir. 1986). 4. Fourth Indispensability Factor, whether the Plaintiff will have an adequate remedy if the action is dismissed for non-joinder. Rule 19(b)’s fourth factor requires the court to consider whether there is another adequate forum available to the Plaintiff. In this case there is such a forum—the tribal forum. But even if there were not another forum, the fourth factor would still not weigh in favor of Plaintiff because the existence of an alternative forum is not dispositive and, usually, the case will be dismissed if the other factors weigh in favor of finding the party indispensable. In Pit River Home, the circuit court noted that the “lack of an alternative forum does not automatically prevent dismissal of a suit,” 30 F.3d at 1102 (citing Makah Indian Tribe v. Verity, 910 F.2d 555, 560 (9th Cir. 1990)). Indeed, the lack of an alternative forum “is a common consequence of sovereign immunity, and the Tribe’s interest in maintaining their sovereign immunity outweighs the plaintiffs’ interest in litigating their claims.” American Greyhound, 305 F.3d at 1025. This conclusion recognizes Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 17 of 21 18 Congress’s broad authority over Indian matters and the long-standing policy of protecting tribal sovereignty and immunity from suit. Pit River, 30 F.3d at 1103; Quileute, 18 F.3d at 1460-61. All four FRCP 19(b) factors weigh in favor of a finding that the Three Affiliated Tribes is an indispensable party to this action. V. SACAJAWEA PIPELINE CO. IS A NECESSARY AND UNJOINED PARTY. Plaintiff’s Complaint is based upon interests from a right of way which the United States granted to Plaintiff. E.g., Compl. ¶13 (Paradigm has obtained all the federal permits and approvals required by the Army Corps of Engineers (“Corps”) and Bureau of Indian Affairs (“BIA”) granting it the authority to complete its pipelines.”); ¶ 20 (“As required by federal law, Paradigm sought and obtained a right-of-way from the Corps.”).4 4 Although not necessary to the jurisdictional issues here, Defendants note that Plaintiff’s arguments as to its right to construct the pipeline under the lake should be rejected for a number of reasons. For example; (1) MHA owns the mineral estate per the Fort Berthold Mineral Restoration Act, P.L. 98-602, 98 Stat. 3149 §202, a law that is not even mentioned in the papers Plaintiff filed; (2) tribal consent is required before penetrating the Tribal subsurface mineral estate pursuant to 25 U.S.C. 324, and a BIA right-of-way is required pursuant to 25 U.S.C. 323 and other applicable federal statutes that prohibit persons from entering or possessing tribal lands without federal and tribal approval; (3) MHA’s federally approved Constitution provides that Tribal Business Council is the governing body of the Tribe with authority to manage tribal land and protect natural resources which empowers the Council to require consent before a pipeline is constructed on or near the lake; (4) the Tribal Constitution and federal law also empowers the Tribal Business Council to prevent the encumbrance of tribal land, and Council has done so by requiring its consent before a pipeline is bored through tribal land; (5) the Tribe’s inherent sovereign authority to manage and protect its land and resources also supports the Council’s exercise of jurisdiction here; (5) 30 U.S.C. 185 does not support Plaintiff’s argument for a number of reasons. First, the statute does not apply to Indian trust lands so it cannot be a basis for permission to bore through the Tribe’s mineral estate under the lake. Second, even if the statute applies, it was misapplied here because the right-of-way involved federal land administered by more than one federal agency (in this case the Army Corps of Engineers (“COE”) and BIA), in which case the right-of-way can only be granted by the Secretary of the Interior (here the right-of- way was granted by COE, not the Secretary). Third, the COE right-of-way itself says it is not exclusive, by stating that nothing in the right-of-way excuses grantee for getting all other governmental approvals. Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 18 of 21 19 Its allegation is false. The “easement is made . . . between the Secretary of the Army . . . and Sacagawea Pipeline Company, LLC.”5 Sacagawea Pipeline is a legally separate entity, in which others, including tribally owned corporate entities, have financial interests. It is likely that Sacagawea Pipeline would be the potential real plaintiff in interest, and that Sacagawea Pipeline would at the very least be a necessary party to the suit under FRCP 19(a) because the present suit seeks to determine the scope of rights which Sacagawea Pipeline has under Sacagawea Pipeline’s right-of-way. Sacagawea Pipeline has not joined in Plaintiff’s suit, in which Plaintiff seeks to diminish the sovereign powers of Sacagawea Pipeline’s partial owner. This case cannot proceed without the easement owner as a party. VI. THE COURT SHOULD DISMISS UNLESS PLAINTIFF SUBSEQUENTLY AND TIMELY COMPLETES SERVICE OF PROCESS AND FILES AN ADEQUATE AFFIDAVIT OR DECLARATION REGARDING SERVICE. Defendants are not waiving service of process. As of the time of writing this motion to dismiss, there is no affidavit or declaration showing service of process on any Defendant. It therefore should be undisputed that as of the time that this motion is filed, there is insufficient service of process and therefore lack of personal jurisdiction over Defendants. Because Defendants must include alleged inadequate service and lack of personal jurisdiction within its first motion to dismiss in this matter, Defendants request dismissal on these grounds at this time. Should Plaintiffs subsequently establish lawful and timely service, Defendants would withdraw this limited portion of this motion to dismiss. 5 In any motion under FRCP 12, where an allegation in a complaint is contrary to a document attached to the complaint, the facts shown in the document control over contrary allegations in the complaint. E.g. Whitney v. Guys, Inc., 700 F.3d 1118, 1128 (8th Cir. 2012) Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 19 of 21 20 CONCLUSION Plaintiff seeks to prohibit the Three Affiliated Tribes from directing that Plaintiff cease activities on tribal land until Plaintiff obtains all required permits and authorizations. The Court must dismiss the Complaint for failure to exhaust tribal remedies; because the Tribe is a necessary and indispensable party that cannot be joined because it is cloaked with sovereign immunity; and because Defendants are cloaked with sovereign immunity. Respectfully submitted this 22nd day of August, 2016. /s/ John Fredericks III John Fredericks III FREDERICKS PEEBLES & MORGAN LLP 3730 29th Avenue Mandan, ND 58554 Telephone: (303) 673-9600 Facsimile: (701) 633-5103 Email: jfredericks@ndnlaw.com /s/ Jeffrey S. Rasmussen Jeffrey S. Rasmussen FREDERICKS PEEBLES & MORGAN LLP 1900 Plaza Drive Louisville, CO 80027 Telephone: (303) 673-9600 Facsimile: (303) 673-9155 Email: jrasmussen@ndnlaw.com Counsel for Defendants Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 20 of 21 21 CERTIFICATE OF SERVICE I hereby certify that on this 22nd day of August, 2016, a copy of the foregoing MOTION TO DISMISS AND MEMORANDUM IN SUPPORT was filed electronically with the Clerk of Court through the ECF filing system, which will send notification of such filing to all parties of record as follows: Anthony J. Shaheen Christopher A. Chrisman Andrew C. Emrich Holland & Hart, LLP 555 Seventeenth Street, Suite 3200 Denver, CO 80202 Email: ajshaheen@hollandhart.com acemrich@hollandhart.com cachrisman@hollandhart.com Counsel for Plaintiff /s/ Debra A. Foulk Debra A. Foulk Legal Assistant Case 1:16-cv-00304-DLH-CSM Document 8 Filed 08/22/16 Page 21 of 21 EXHIBIT A Case 1:16-cv-00304-DLH-CSM Document 8-1 Filed 08/22/16 Page 1 of 3 1 Office of the Executive Secretary MANDAN, HIDATSA & ARIKARA NATION Three Affiliated Tribes * Fort Berthold Indian Reservation 404 Frontage Road * New Town, North Dakota 58763-9402 MEMORANDUM TO: Staff FROM: Mike Stevens, Information Technology / Records Manager DATE: Thursday, August 11, 2016 RE: Minutes Request Below are the requested minutes from the; THREE AFFILIATED TRIBES TRIBAL BUSINESS COUNCIL SPECIAL MEETING AUGUST 3rd 2016 MINUTES D. Pipeline Issues P66/ Paradign pipeline boring without tribal consent. MRR/Gray wolf midstream are passive investors. Motion: Councilman Fred Fox moved to issue Paradign a Cease & Desist Order on boring by resolution for the August 11th 2016 Tribal Business Council. Councilman Frank Grady seconded the motion. Vote: 6 Ayes. 1 – Not Present. Motion carried. Chairman Mark N. Fox – Aye Councilman Randy Phelan – Aye Councilman L. Kenneth Hall – Not Present Councilman Mervin Packineau – Aye Councilman Fred Fox – Aye Councilman Frank Grady – Aye Councilman Cory Spotted Bear – Aye __________________________________________________________ If you have any questions, please feel free to contact me at; 701-627-4781x8111 or 701-421-1968, Case 1:16-cv-00304-DLH-CSM Document 8-1 Filed 08/22/16 Page 2 of 3 2 Office of the Executive Secretary or my email is mstevens@mhanation.com. Case 1:16-cv-00304-DLH-CSM Document 8-1 Filed 08/22/16 Page 3 of 3