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Stathis v. Marty Indian School

Supreme Court of South Dakota

June 19, 2019

TIMOTHY STATHIS, Plaintiff and Appellant,
v.
MARTY INDIAN SCHOOL, a South Dakota non-profit corporation; ELK SOLDIER also known as GARY DRAPEAU, SR.; GLENN DRAPEAU; GALENA DRAPEAU; SARA W. ZEPHIER; SARAH R. ZEPHIER; STEPHANIE COURNOYER; JULIE BLACKMOON-WRIGHT; and JOHN AND/OR JANE DOES ONE (1) THROUGH FIVE (5), Defendants and Appellees.

          ARGUED ON APRIL 30, 2019

          APPEAL FROM THE CIRCUIT COURT OF THE FIRST JUDICIAL CIRCUIT CHARLES MIX COUNTY, SOUTH DAKOTA THE HONORABLE BRUCE V. ANDERSON Judge

          JAMES D. TAYLOR Mitchell, South Dakota Attorney for plaintiff and appellant.

          REBECCA L. KIDDER of Fredericks, Peebles & Morgan, LLP Rapid City, South Dakota Attorneys for defendants and appellees.

          OPINION

          GILBERTSON, CHIEF JUSTICE

         [¶1.] Timothy Stathis was employed as the high school principal at the Marty Indian School (MIS) in Marty, South Dakota. In late 2017, a series of incidents between Stathis and members of the MIS school board and community of Marty led to the termination of Stathis's employment. Stathis sued MIS and other involved parties in state court for breach of contract, breach of settlement agreement, wrongful termination, libel, and slander and requested punitive damages. The circuit court dismissed Stathis's complaint on the grounds of tribal sovereign immunity, immunity of tribal officials and employees, federal preemption, and infringement of tribal sovereignty. We affirm the circuit court's dismissal solely on a lack of subject matter jurisdiction based on federal preemption.

         Facts and Procedural History

         [¶2.] On May 8, 2017, Stathis entered into an employment contract with MIS to continue to serve as its high school principal. MIS is located in the town of Marty, South Dakota on the Yankton Sioux Indian Reservation. The school was chartered by the Yankton Sioux Tribe, a federally recognized Indian Tribe. The school operates under a constitution that was approved by the Yankton Sioux Tribal Business and Claims Committee on November 6, 2013. The constitution designates MIS as "a legal entity of the Yankton Sioux Tribe, from whom Marty Indian School, Inc. has been delegated authority to operate and maintain the Marty Indian School." It also states that MIS was "created for the purpose of maintaining and continually upgrading the educational process for the students of the Marty Indian School."

         [¶3.] Stathis's contract with MIS stated that his term of employment would begin around August 1, 2017, and end around June 30, 2018. A provision of the contract entitled "SCHOOL LAW" provided that:

The [MIS] School Board is an entity of the Yankton Sioux Tribe, and is not bound by the laws of the State of South Dakota. The By-laws and Policies and Procedures Manual of the School Board shall be binding and controlling on the parties and shall control the conduct of the operation of the school. Any matter by [sic] controlled by the By-laws and Policies and Procedures will be controlled by the laws of the State of South Dakota. If any ambiguity or question as to whether the laws of the State of South Dakota or the By-laws and Policies and Procedures Manual of the School Board is controlling shall arise, the By-law and Policies and Procedures of the School board shall be binding and controlling. The exceptions to South Dakota School law includes, but is not limited to, the following matters, to wit:
Administrator or Supervisor Retirement, School Calendar, Continuing Contract and Tenure, and Conflict of Interest. Nothing herein shall be construed to constitute and [sic] acceptance by the School Board of the jurisdiction of South Dakota courts.

         [¶4.] As part of his duties as principal, Stathis was required to administer school improvement grants issued by the Bureau of Indian Education. This involved granting monetary bonuses to faculty to incentivize improvement in both faculty and student performance. While employed at MIS, Stathis developed a set of criteria to assist in awarding these bonuses. These criteria and the awarding of bonuses became the subject of several disputes between Stathis, MIS faculty, the MIS school board, and members of the Marty community.

         [¶5.] On November 15, 2017, opposition to Stathis's handling of monetary bonuses reached a boiling point. On that date, Elk Soldier (also known as Gary Drapeau, Sr.), a member of MIS faculty, arranged a sit-in demonstration at the MIS library for students and other community members to protest Stathis's actions. The exact nature of the participants' grievances with Stathis is somewhat unclear from the record. As the gathering grew in size, members of the MIS school board, including Appellees Julia Blackmoon-Wright, Sarah W. Zephier, and Stephanie Cournoyer, began to arrive to assess the situation. Blackmoon-Wright sat in the front row of the gathering and stated, "I am a School Board Member, I am here to listen to what you want to say." Sarah W. Zephier, the president of the school board, then took control of the gathering.

         [¶6.] President Zephier encouraged attendees of the gathering to voice their specific complaints regarding Stathis. This led to what Stathis characterizes as "an impromptu open and public meeting about Stathis between students, the entire Marty Indian School Board, members of the public, and Appellees John and/or Jane Does One (1) through Five (5)." The impromptu meeting continued for approximately two hours, at which point it was announced over the school's public address system that there would be an emergency executive session of the school board. The school board commenced a meeting in ...


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