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Romero v. Wounded Knee, LLC

United States District Court, D. South Dakota, Western Division

August 31, 2018

LESLIE ROMERO, Plaintiff,
v.
WOUNDED KNEE, LLC d/b/a SIOUX-PREME WOOD PRODUCTS, a South Dakota limited liability company; and WOUNDED KNEE COMMUNITY DEVELOPMENT CORPORATION, a South Dakota corporation, Defendants.

          ORDER

          JEFFREY L. VIKEN CHIEF JUDGE.

         INTRODUCTION

         Plaintiff Leslie Romero initiated this action against defendants Wounded Knee LLC (“WK LLC”), Wounded Knee Community Development Corporation (“WKCDC”) and Mark St. Pierre. (Docket 1). Upon plaintiff's motion, the court dismissed Mr. St. Pierre. (Docket 31). WK LLC has not formally appeared in the case. WKCDC retained counsel and appeared. (Docket 32).

         Plaintiff claims she was sexually assaulted and harassed while employed by defendants. (Docket 1). She alleges torts and violations of Title VII of the Civil Rights Act of 1964 and the South Dakota Human Relations Act of 1972. Id. Plaintiff is an enrolled member of the Oglala Sioux Tribe (“Tribe”) and the incidents alleged in the complaint occurred within the exterior boundaries of the Pine Ridge Indian Reservation (“Pine Ridge”) at Manderson, South Dakota.

         PROCEDURAL AND FACTUAL BACKGROUND[1]

         Defendants failed to file answers to plaintiff's complaint, so the clerk entered default against them. (Docket 14). Plaintiff filed a motion for default judgment, and the court entered an order finding she was entitled to default judgment. (Docket 27). The court later acknowledged it will not enter final judgment in plaintiff's favor until the court makes findings regarding the specific claims in the complaint on which it would enter judgment and the appropriate amount of damages supported by evidence. (Docket 39). While the court granted plaintiff's motion for default judgment, a final judgment has not been entered in this case.

         To prevent an adverse final judgment, WKCDC raised the issues of tribal court exhaustion and tribal sovereign immunity in a motion to set aside default judgment. (Dockets 41 & 42). WKCDC alleges its connection with the Tribe provides WKCDC with tribal sovereign immunity. (Dockets 41 & 42). According to WKCDC, its origins trace back to a federal economic program. (Docket 42 at p. 7). WKCDC indicates that nearly two decades ago the Oglala Oyata Woitancan (“OOW”) was established in coordination with the federal government. Id. The OOW was a geographic designation covering primarily Pine Ridge. Id.[2] An emphasis of the OOW was facilitating infrastructure development funds from the federal government to Pine Ridge. See Danielle Her Many Horses, Oglala Lakota Nation Profile, University of New Mexico School of Law Tribal Law Journal, Volume 2: 2001-02, available at http://lawschool.unm.edu/tlj/volumes/vol2//oglala/index.html#rfn105. The Tribe's Constitution created community governments called Districts that represent local interests, and each District could choose whether to participate in the OOW. Id. WKCDC claims there was an OOW Board with a member who was also a member of an entity WKCDC refers to as the Wounded Knee District Task Force (“the District Task Force”). (Docket 42 at p. 7). According to WKCDC, once the OOW expired, the District Task Force became WKCDC and the District Task Force's assets and property were transferred to WKCDC. Id. WKCDC alleges its articles of incorporation demonstrate its affiliation with the Tribe and WKCDC's tribal sovereign immunity. Id. at pp. 8-9.

         Plaintiff filed a response to WKCDC's motion to set aside default judgment, and plaintiff requested more time to conduct discovery on the issues spotlighted in the motion. (Docket 50). The court informally communicated with the parties about a discovery timeline and entered a scheduling order requiring the parties to participate in discovery on the issues of tribal court exhaustion and tribal sovereign immunity. (Docket 54).

         WKCDC, through its attorney Deborah Dubray, violated the discovery order and the court granted plaintiff's motion for sanctions pursuant to Federal Rule of Civil Procedure 37. (Docket 79). Part of the noncompliance was Ms. Dubray refusing to participate in discovery and filing a Rule 12(b)(1) motion claiming WKCDC was entitled to tribal sovereign immunity. (Docket 55). The court held a show cause hearing prior to entering the Rule 37 sanctions order. (Docket 70). At the conclusion of the show cause hearing, the court ordered the parties to submit briefing on the applicability of tribal court exhaustion to the case.

         ANALYSIS

         “Tribal sovereign immunity predates the birth of the Republic. The immunity rests on the status of Indian tribes as autonomous political entities, retaining their original natural rights with regard to self-governance.” Ninigret Dev. Corp. v. Narragansett Indian Wetuomuck Hous. Auth., 207 F.3d 21, 29 (1st Cir. 2000) (internal citation and quotation marks omitted). “As a matter of comity, the examination of tribal sovereignty and jurisdiction should be conducted in the first instance by the tribal court itself. Thus, a federal court should stay its hand in order to give tribal forums the initial opportunity to determine cases involving questions of tribal authority.” Colombe v. Rosebud Sioux Tribe, 747 F.3d 1020, 1024 (8th Cir. 2014) (internal alteration, citation and quotation marks omitted). “Allowing tribal courts to make an initial evaluation of jurisdictional questions serves several important functions, such as assisting in the orderly administration of justice, providing federal courts with the benefit of tribal expertise, and clarifying the factual and legal issues that are under dispute and relevant for any jurisdictional evaluation.” DISH Network Serv. L.L.C. v. Laducer, 725 F.3d 877, 882 (8th Cir. 2013) (citing Nat'l Farmers Union Ins. Cos. v. Crow Tribe of Indians, 471 U.S. 845, 856-57, (1985)). “Exhaustion includes both an initial decision by the tribal court and the completion of appellate review.” Id. at 882-83 (citing Iowa Mut. Ins. Co. v. LaPlante, 480 U.S. 9, 15 (1987)).

         “[T]he doctrine of tribal court exhaustion applies even when there is no pending concurrent tribal action.” Heldt v. Payday Fin., LLC, 12 F.Supp.3d 1170, 1180 (D.S.D. 2014). Courts can raise tribal court exhaustion sua sponte. AT&T Corp. v. Oglala Sioux Tribe Util. Comm'n, No. CIV 14-4150, 2015 WL 5684937, at *5 (D.S.D. Sept. 25, 2015) (“While the parties do not raise the question of the applicability of tribal exhaustion doctrine, the Court finds it to be a necessary consideration and thus raises it sua sponte.”); see United States v. Tsosie, 92 F.3d 1037, 1041 (10th Cir. 1996) (holding tribal exhaustion may be addressed sua sponte).

         Tribal sovereign immunity goes to the court's subject matter jurisdiction and usually the court must address jurisdictional issues first. But the precedent of the United States Court of Appeals for the Eighth Circuit requires the court to enforce the exhaustion of tribal court remedies before fully analyzing tribal sovereign immunity. In Davis v. Mille Lacs Band of Chippewa Indians, the Eighth Circuit held “the Supreme Court has stated that the issue of a tribe's sovereign immunity is the very kind of question that is to be decided in the first instance by the tribal court itself.” 193 F.3d 990, 992 (8th Cir. 1999); see Malaterre v. Amerind Risk Mgmt., 373 F.Supp.2d 980, 982 n.3 (D.N.D. 2005) (“It has been established in the Eighth Circuit that tribal exhaustion precedes the tribal immunity inquiry.”);[3] see also Ninigret (“The Eighth Circuit has held that a district court should begin this phase of its inquiry by addressing exhaustion and, if it determines that tribal remedies must be exhausted, give the tribal court the first crack at considering the bona fides of the sovereign immunity defense.”).[4]

         Whether tribal sovereign immunity shields WKCDC from suit raises important legal and factual issues federal courts often analyze. See J.L. Ward Associates, Inc. v. Great Plains Tribal Chairmen's Health Bd., 842 F.Supp.2d 1163, 1171-72 (D.S.D. 2012) (collecting cases). Federal courts also routinely provide tribal courts the first opportunity to address those issues. See, e.g., Sharber v. Spirit Mountain Gaming Inc., 343 F.3d 974, 976 (9th Cir. 2003) (per curium) (“Nor did the district court err in concluding that the tribal exhaustion requirement also applies to issues of tribal sovereign immunity. Determining whether the tribe has waived immunity, or ...


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