UNITED STATES DISTRICT COURT DISTRICT OF SOUTH DAKOTA SOUTHERN DIVISION
January 26, 2011
FLANDREAU SANTEE SIOUX TRIBE, A FEDERALLY-RECOGNIZED INDIAN TRIBE,
STATE OF SOUTH DAKOTA, DEFENDANT.
The opinion of the court was delivered by: John E. Simko United States Magistrate Judge
ORDER ON MOTION TO QUASH SUBPOENA (DOC. 197)
Pending is the State's motion to quash the Tribe's notice to take the
deposition of Governor Michael Rounds.*fn1 The State
argues former Governor Rounds*fn2 is a high ranking
government official whose deposition cannot be taken absent
extraordinary circumstances.*fn3 The State also argues
that conversations among the former Governor and staff are protected
from discovery by the deliberative process privilege.*fn4
The Tribe argues Governor Rounds is the only source for the
particular information they need to prove their case and the
deliberative process privilege does not apply.*fn5
Former Governor Rounds has filed an affidavit*fn6 in which he says that he designated Larry Eliason to negotiate class III gaming contracts with South Dakota Indian tribes pursuant to the Indian Gaming Regulatory Act (IGRA). Rob Skjonsberg, Chief of Staff, was the primary person of contact for Larry Eliason. Governor Rounds did not personally attend the negotiating sessions. The State asserts that Governor Rounds possesses no pertinent first hand information and that all of his information comes through Rob Skjonsberg from Larry Eliason. According to the State,*fn7 Governor Rounds does not possess any information that cannot be obtained from either Rob Skjonsberg or Larry Eliason. Furthermore, the State argues that relevant evidence by definition excludes any evidence not part and parcel of the negotiating sessions. The State argues that Governor Rounds does not possess relevant evidence. Furthermore, deliberations and documents that guide or inform the decisions of the State's policy makers are protected by the deliberative process privilege.*fn8
The Tribe argues that Governor Rounds is the ultimate decision maker for the State about the gaming compact.*fn9 According to the Tribe, with little or no explanation Governor Rounds has been unwilling to sign a compact which contains terms acceptable to the Tribe.*fn10 The Tribe argues that as the ultimate decision maker for the State, Governor Rounds is a witness with unique personal knowledge about the State's reasons for refusing to sign a compact. The Tribe proposed a compact which allowed 1500 gaming devices compared to 250 under the most recent compact, but the State without explanation refused to agree.*fn11 The Tribe asserts Governor Rounds was personally involved in reviewing compact proposals and promoting his policy positions during six unsuccessful negotiating sessions. The Tribe suggests that Governor Rounds has written letters to the Tribe and others in which he says he is fully informed of the progress of the negotiating sessions, and that he has seen nothing which alleviates his concerns about the impact on the State's revenue if the Tribe operates more than 250 machines.*fn12 The Tribe asserts that it carries the burden to prove the State has not negotiated in good faith, so it is necessary for the Tribe to learn from Governor Rounds why he will not agree to the Tribe's proposals.*fn13
Indian Gaming Regulatory Act (IGRA).
Some background beyond the discovery rule of the Federal Rules of Civil Procedure is a necessary predicate to the analysis of this dispute. The centerpiece for analysis of this case is IGRA.*fn14 Under IGRA class III gaming can be conducted only if, among other matters, it is conducted within a State which permits such gaming and is conducted in conformance with a Tribal-State compact that is in effect.*fn15 A Tribal-State compact may include provisions relating to seven subjects:
1. Application of criminal and civil laws and regulations that are directly related to and necessary for licensing and regulation of pertinent gaming activities.
2. Allocation of criminal and civil jurisdiction for the enforcement of those laws and regulations.
3. An assessment of gaming activities in such amounts as are necessary to defray the costs of regulating the gaming activities.
4. Taxation of the gaming activities by the Tribe in amounts comparable to amounts assessed by the State for comparable activities.
5. Remedies for breach of contract.
6. Standards for the operation of gaming and maintenance of the gaming facility, including licensing.
7. And other subjects that are directly related to the operation of gaming activities.*fn16
The United States district courts are vested with jurisdiction over lawsuits commenced by an Indian tribe arising from the failure of a State to enter into negotiations with an Indian tribe for a Tribal-State compact or to conduct negotiations in good faith.*fn17 If in the lawsuit the Indian tribe demonstrates that the Tribal-State compact has not been entered into and that the State did not respond to the request to negotiate or that the State did not respond in good faith, then the burden shifts to the State to prove that it has negotiated with the Indian tribe in good faith.*fn18 Despite IGRA, the federal courts do not have jurisdiction unless the State has waived Eleventh Amendment immunity.*fn19 South Dakota has waived immunity under IGRA.*fn20
Good Faith Not Defined.
The purpose of the Tribe's lawsuit is to determine whether the State has conducted negotiations for a Tribal-State compact in good faith.*fn21 IGRA does not define good faith. But IGRA does suggest what the court can consider when deciding whether the State has negotiated in good faith:*fn22
! may consider public interest, public safety, criminality, financial integrity, and adverse economic impacts on existing gaming activities;
! shall consider any demand by the State for direct taxation of the Tribe.
Evidence to be Evaluated.
More Than The Bare Record Is Reviewed. In 1993 Judge Jones decided in the Cheyenne River Sioux case that only the transcripts of the negotiating sessions would be reviewed to judge whether the State had negotiated in good faith.*fn23 It was Judge Jones' view in Cheyenne that the posturing by the parties which was reflected in their conversations, letters, and press releases was not to be considered. But, in this case Judge Piersol has allowed limited discovery outside of the transcripts.*fn24 Judge Piersol explained:
Whether or not discovery is warranted is normally dependent upon the facts of the case and the claims of the parties. Here, Defendants claim, among other things, that the State of South Dakota has a long standing policy of limited gaming, which policy has been a basis for the State's positions in the compact negotiations. The Tribe contends that the State has not followed such a policy on non-Indian gaming. As a result, the Tribe claims that what gaming policy the State has followed bears upon whether or not the State negotiated with the Tribe in good faith. The conflicting claims coupled with the fact that the Tribe has a significant burden to meet in attempting to show a lack of good faith on the part of the State, require that in this case discovery be allowed. Facts and circumstances outside of the actual transcript of the negotiations may be relevant in aiding the Court in its determination of whether or not the State negotiated in good faith.
Evidence outside of the negotiating sessions is discoverable under Judge Piersol's discovery order.
But There Is Not A Review Of The State's Subjective Intent. The Ninth Circuit provides instruction about discovery under IGRA, but according to the State of California the most pertinent case was wrongly decided.*fn25 There is a pending Petition for Certiorari in the United States Supreme Court.*fn26 The scope of review of the State's good faith under IGRA is not among the questions presented in the Petition for Certiorari.*fn27 The issues described in the petition are divided into categories A and B. Category A asserts there are recurring issues "concerning the permissible scope of tribal-state negotiations under IGRA. . . ." *fn28 But unlike today's case the Petition reveals objective versus subjective review is not directly questioned. Rather, the questions posed in the Petition are (1) whether revenue sharing is a fair subject for negotiation despite the statute's expressed ban against negotiating for a direct tax on the Tribe, and (2) whether it was error for the Ninth Circuit to weigh the relative value of concessions offered by the parties.*fn29 California complains the court did not attempt to determine whether the State's conduct of negotiations was a sincere effort to reach agreement or was a charade, or sham. Instead, after erroneously concluding that the State had demanded direct taxation of the Tribe, the majority looked to the relative value of the concessions the State offered in exchange for general fund revenue sharing. But this inquiry has little relevance to whether the State engaged in a sincere effort to reach agreement. . . . To the contrary, this valuation is, in the first instance, left expressly between the two equal sovereigns.*fn30
Rincon's rule is that good faith should be judged based on the objective record of negotiations, and that a State's subjective intent is not considered.*fn31
However, we are influenced by the factors outlined in § 2710(d)(7)(B)(iii), which lend themselves to objective analysis and make no mention of unreasonable beliefs. Further, the structure and content of § 2710(d) make clear that the function of the good faith requirement and judicial remedy is to permit the tribe to process gaming arrangements on an expedited basis, not to embroil the parties in litigation over their subjective motivations.*fn32
Rincon's instruction is to exclude the State's state of mind and motives from the review for good faith.*fn33 Additionally, the review for good faith "is one that takes into account all of the facts and circumstances, not just the bare record of negotiations between the parties."*fn34 Having in mind that discovery outside the bare record of negotiations is appropriate and that the State's state of mind and motives are not a part of judging the State's good faith, the analysis now turns to the deposition of former Governor Rounds.
Governor Rounds' Deposition.
Subjective Versus Objective. The boundary line between that which is discoverable and that which is not discoverable is marked by the boundary line between objective facts and subjective intent. Objective facts are discoverable. Subjective motives, beliefs, and intent are not.*fn35 Only limited resort to the tests suggested by the State is necessary to resolve this dispute. One test suggested by the State is to determine when it is appropriate to depose a high ranking government official.*fn36 The other test suggested by the State is to determine when the deliberative process privilege can be overcome.*fn37 The deliberative process privilege relates to documents and is established under Exception 5 of the Freedom of Information Act. Near the end of this opinion taking testimony from a high ranking government official is addressed. It is not necessary to address the deliberative process privilege further.
The Tribe does not wish to depose Governor Rounds about any of the
objective matters described in the statute.*fn38
Instead the Tribe argues "the State's intent is at issue in this
case."*fn39 They assert "Mr. Rounds has 'direct
personal factual information pertaining to material issues in an
action' and the information he possesses is not reasonably available
from any other source."*fn40 The Tribe refers to
letters written by Governor Rounds in which he says he is fully
informed about the negotiations and that he has enjoyed working with
"President Allen and other tribal leaders on this matter."*fn41
They refer to other discovery which indicates Governor Rounds
was involved in numerous internal meetings and gave instructions to
his administration about the Tribe's proposals.*fn42
It is asserted by the Tribe that "Mr. Rounds' motivations throughout the compact negotiation process are highly relevant to this litigation."*fn43 "The impetus behind Mr. Rounds' decisions are important evidence" for the Tribe to fulfill its burden to show the State did not respond in good faith.*fn44 The Tribe argues "The Tribe is entitled to discover the basis for Mr. Rounds' decision for refusing to agree to the Tribe's proposals."*fn45
No one else can explain the Governor's motivations and positions as to the negotiations with the Tribe; no one else can identify as well as Governor Rounds the alternative proposals he considered, and no adopt else can better explain his reasons for not approving proposals submitted by the Tribe.*fn46
The Tribe also argues it needs to question Governor Rounds about statements he made, letters he wrote, and campaign positions he espoused about limited gambling being public policy in South Dakota.*fn47
Mr. Rounds is the only person that possesses first-hand knowledge as to the impetus of his decisions concerning the Tribal-State Compact negotiations. Under IGRA, as explained further herein, whether the State has negotiated in good faith is a subjective question of intent. Here, the Tribe does not seek to inquire simply into "what" Governor Rounds did that may have resulted in bad faith, but also seeks Mr. Rounds rationale in refusing to accept any of the Tribe's compact proposals. Such an inquiry requires the actual testimony of the decision maker.*fn48
The Tribe also argues the State itself has placed the Governor's intent at issue.*fn49
From all of these assertions by the Tribe it is quite evident the Tribe believes the State's subjective motivation is to be reviewed for good faith, i.e. the State's motives and reasons for its decisions not to agree to proposals made by the Tribe. This very issue was addressed in Big Lagoon #2:*fn50
The language of the Rincon decision makes one point clear: the subjective motivations of the parties are not relevant to the good faith determination.
Even if it is true that the State itself has made intent an issue, which is disputed by the State, that is not enough to expand the good faith evaluation to include subjective motives or beliefs in the good faith evaluation.*fn51 The review is limited to objective facts.*fn52
High Ranking Government Official. There is a five part test about allowing the deposition of a high ranking official:
(1) the official's testimony is necessary to obtain relevant information that is not available from another source;
(2) the official has first hand information that cannot reasonably be obtained from other sources;
(3) the testimony is essential to the case at hand;
(4) the deposition would not significantly interfere with the ability of the official to perform his government duties; and
(5) the evidence sought is not available through less burdensome means or alternative sources.*fn53
If the good faith evaluation were to include subjective intent and motives, the results of this test would come down on the side of allowing Governor Rounds' deposition. But the good faith evaluation is based upon objective facts. When the test is applied to objective facts, the results come down on the side of not allowing Governor Rounds' deposition. ! First, the Tribe wants evidence about underlying reasons for refusing to agree to the Tribe's proposals, i.e. matters of subjective considerations. Subjective matters are not relevant because the good faith evaluation is based upon objective facts. These objective facts are available from sources other than a deposition from the Governor. ! Second, if subjective matters could be considered, Governor Rounds would have first hand information about his refusal to agree to the Tribe's proposals. But about objective facts his information is no better than that of others, and the objective facts are available from other sources. ! Third, Governor Rounds' testimony is not essential to ascertaining the objective facts. The only facts the Tribe asserts it needs to learn from Governor Rounds are subjective matters. ! Fourth, without regard to whether Governor Rounds is the sitting or former governor, the deposition could be arranged so that it would not significantly interfere with the affairs of government. The proposed deposition is limited in time to one day of seven hours under Rule 30(d)(1), or even less if ordered by the court. This issue is now moot because Governor Rounds is now former Governor Rounds. ! Fifth, the objective facts can be ascertained through other means which are less burdensome.
The record reveals that other depositions have already occurred and that the objective facts are already known from those depositions and from other means. The Tribe and the State are the two parties to the negotiations so by virtue of being parties to the negotiations they necessarily know the objective facts.
Because the Tribe's reason for wishing to depose former Governor Rounds is to inquire into subjective matters not relevant to judging the State's good faith, and because application of the test about allowing a deposition of a high ranking government official comes down on the side of not allowing Governor Rounds' deposition,
It is ORDERED that the State's motion to quash the Tribe's notice to take former Governor Rounds' deposition is GRANTED.*fn54
It is FURTHER ORDERED that this Order is without prejudice so that the Tribe may move for reconsideration of this Order if the United States Supreme Court timely grants California's pending petition for certiorari and decides that the scope of review should include the subjective motivation of the State as well as objective facts.
Dated this 26th day of January, 2011.
BY THE COURT: