In the 

United States Court of Appeals 

For the Seventh Circuit ____________________ 

Nos. 14-2150 & 14-2287 

STIFEL, NICHOLAUS & COMPANY, INC., 

et al., 

Plaintiffs-Appellees, 

and 

GODFREY & KAHN, 

Plaintiff-Appellee/Cross-Appellant, 

v.

LAC DU FLAMBEAU BAND OF LAKE 

SUPERIOR CHIPPEWA INDIANS and LAKE

OF THE TORCHES ECONOMIC DEVELOPMENT

CORPORATION, 

Defendants-Appellants/Cross-Appellees. 

____________________ 

Appeal from the United States District Court for the 

Western District of Wisconsin. 

No. 3:13-cv-00372-wmc — William M. Conley, Chief Judge. 

____________________ 

ARGUED APRIL 9, 2015 — DECIDED NOVEMBER 24, 2015 

____________________ 

Before FLAUM, RIPPLE, and WILLIAMS, Circuit Judges. 
2 Nos. 14-2150 & 14-2287 

RIPPLE, Circuit Judge. The current appeal is the most recent in a series of lawsuits that have arisen over the sale of 

bonds by the Lake of the Torches Economic Development 

Corporation (“the Corporation”), a corporation wholly 

owned by the Lac du Flambeau Band of Lake Superior 

Chippewa Indians (“the Tribe”) (collectively “the Tribal Entities”). In a prior action in this court, Wells Fargo Bank 

(“Wells Fargo”) had alleged that the Corporation had 

breached a bond indenture and, as trustee for the bondholders, had sought “the appointment of a receiver to manage 

the trust security on behalf of the bondholder.” Wells Fargo 

Bank v. Lake of the Torches Econ. Dev. Corp., 658 F.3d 684, 686 

(7th Cir. 2011). We held that the bond indenture constituted 

an unapproved management contract under the Indian 

Gaming Regulatory Act (“the IGRA”), 25 U.S.C. §§ 2701–

2721, and was therefore void. Following our decision, the 

validity of other bond-related documents continued to be 

litigated in other courts. 

After more than three years of litigating in federal and 

state court, the Tribal Entities instituted a tribal court action 

in April 2013 seeking a declaration that the bonds are invalid 

under the IGRA as well as tribal law. The action currently 

before the court represents the efforts of the non-tribal parties to put an end to the tribal court action. Those non-tribal 

parties are: Stifel, Nicolaus & Company, Inc., the initial purchaser of the bonds; Stifel, Nicolaus & Company’s parent 

corporation, Stifel Financial Corporation (collectively 

“Stifel”); LDF Acquisition, LLC (“LDF”), a special purpose 

vehicle created by the predecessor of Saybrook Fund Investors, LLC (collectively “Saybrook”) for the purpose of pur-
Nos. 14-2150 & 14-2287 3

chasing the bonds; Wells Fargo;1 and Godfrey & Kahn S.C. 

(“Godfrey”), counsel to the Corporation and bond counsel to 

the transaction. Specifically, the Financial Entities and Godfrey sought an injunction in the Western District of Wisconsin to preclude the Tribal Entities from pursuing their tribal 

court action.

Following the submission of evidence and a hearing, the 

district court preliminarily enjoined the Tribal Entities from 

proceeding against the Financial Entities, but allowed the 

tribal action to proceed against Godfrey. The Tribal Entities 

appealed the district court’s grant of the injunction, and 

Godfrey cross-appealed the district court’s denial of the 

same. 

We now affirm in part, and reverse and remand in part. 

We agree with the district court that tribal court exhaustion 

was not required. We also concur that the Tribal Entities effectuated a valid waiver of their sovereign immunity, and, 

therefore, the action against them may proceed. Finally, we 

agree that the Financial Entities have established a substantial likelihood of succeeding in their challenge to the tribal 

court’s jurisdiction; we conclude, therefore, that the district 

court did not abuse its discretion in enjoining the tribal court 

action against the Financial Entities. 

With respect to Godfrey’s cross-appeal, we conclude that 

the district court made several errors of law in assessing 

whether Godfrey had established a likelihood of success on 

the merits. With respect to Godfrey’s cross-appeal, therefore, 

 

1 Stifel, LDF, Saybrook, and Wells Fargo are referred to collectively as 

“the Financial Entities.” 
4 Nos. 14-2150 & 14-2287 

we reverse the judgment of the district court and remand for 

further proceedings. 

I 

BACKGROUND 

A. Facts 

1. 

The Corporation is chartered under tribal law to own and 

operate the Lake of the Torches Resort Casino (“the Casino”). The Casino is a gaming facility located on tribal lands 

in northern Wisconsin and is operated pursuant to a tribalstate compact with the State of Wisconsin. 

In 2007, “the Tribe decided to diversify its operations by 

investing in a project to build a riverboat casino, hotel and 

bed and breakfast in Natchez, Mississippi. In order to secure 

funding for that investment and to refinance $27.8 million of 

existing debt, [the Corporation] issued $50 million in taxable 

gaming revenue bonds” in January 2008. Wells Fargo Bank, 

658 F.3d at 688–89. Godfrey, in its capacity as counsel to the 

Corporation and bond counsel for the transaction, issued 

two opinion letters as to the meaning of several bond-related 

documents and the legality of the bond transaction. 

The bonds were sold to a brokerage firm, Stifel, and then 

resold to LDF. “The bonds, which were secured by the revenues and related assets of the Casino, were accompanied by 

a trust indenture (‘the Indenture’) naming Wells Fargo as 

trustee.” Id. at 689 (footnote omitted). The Indenture included numerous provisions “that vested in Wells Fargo and the 

bondholder the power to ensure that [the Corporation] satisfied its repayment obligations.” Id. This power included 
Nos. 14-2150 & 14-2287 5

oversight of Casino revenues, which the Corporation was 

required to deposit in an account controlled by Wells Fargo. 

Along with the Indenture, there were several other documents relevant to the transaction: the Specimen Bond,2 a 

Bond Purchase Agreement,3 a resolution related to the issuance of the bonds (“the Bond Resolution”),4 a Tribal Resolution,5 and opinion letters by Godfrey6 (collectively “the Bond 

Documents”). Several of these documents contain (1) waivers of sovereign immunity on behalf of the Tribal Entities; (2) 

forum selection clauses designating the United States District Court for the Western District of Wisconsin (or, alternatively, the courts of Wisconsin) as the exclusive forum for 

disputes concerning the bond transaction; and (3) choice-oflaw clauses designating the law of Wisconsin as the law according to which the documents were to be construed and 

disputes were to be resolved. 

The Natchez investment proved to be less lucrative than 

expected, and the Tribe had trouble meeting its bond obligations. In October 2009, the Tribe elected a new governing 

council that had campaigned on a pledge to repudiate the 

bonds. The Corporation eventually repudiated its obligations under the bonds and refused to repay the $46,615,000 

remaining principal or the interest. 

 

2 R.1-1.

3 R.1-3. 

4 R.1-5. 

5 R.1-10. 

6 R.99-9, 99-10.
6 Nos. 14-2150 & 14-2287 

2. 

When the Corporation repudiated the bonds, Wells Fargo brought an initial action in federal district court to enforce the Indenture. The district court, however, dismissed 

the action for lack of subject matter jurisdiction. It believed 

that several provisions of the Indenture “provide[d] Wells 

Fargo and Saybrook with significant authority to set up 

working policy for the Casino’s operations.” Id. at 690. As 

such, the Indenture constituted a management contract under the IGRA and was void because it had not been submitted to the Indian Gaming Regulatory Commission (“Commission”) for approval. See id. at 691. Moreover, “[b]ecause 

unapproved management contracts are void, the waiver of 

sovereign immunity contained in the Indenture also was 

void and the district court was without jurisdiction. Consequently, it dismissed the case.” Id. 

The district court subsequently denied Wells Fargo’s motion to amend its complaint to assert claims based on other 

documents in the bond transaction, such as the bond itself. 

According to the district court, the other documents on 

which Wells Fargo sought to rely were “collateral agreements within the meaning of Commission regulations and, 

in the view of the district court, [we]re therefore also void.” 

Id. at 692 (internal quotation marks omitted). 

On appeal, we affirmed the district court’s judgment that 

the Indenture was void as an unapproved management contract. We determined, however, that the district court’s conclusion—that the other documents related to the bond transaction also were void—was premature: 
Nos. 14-2150 & 14-2287 7

It is not immediately apparent that the waivers 

contained in the documents attached to the 

proffered amended complaint, when read separately or together, ought to be construed as 

dependent on the validity of the waiver in the 

Indenture and that they do not make clear the 

Corporation’s intent to render itself amenable 

to suit for legal and equitable claims in connection with the bond transaction. 

Id. at 701. We “conclude[d] that the district court should 

have permitted Wells Fargo leave to file an amended complaint to the extent that it presented claims for legal and equitable relief in connection with the bond transaction on its 

own behalf and on behalf of the bondholder.” Id. at 702. We 

also were mindful, however, that there was a question 

whether Wells Fargo could seek that relief now that the Indenture was void. Thus, the district court would have to 

“address whether Wells Fargo’s standing to seek such relief 

on behalf of the bondholder survives the voiding of the Indenture.” Id. We instructed that, after determining the standing issue, the district court “should proceed to address 

whether the transactional documents, taken alone or together, evince an intent on the part of the Corporation to waive 

sovereign immunity with respect to claims by Wells Fargo 

on its own behalf and, if it has standing to do so, on behalf of 

the bondholder.” Id. 

On remand, Wells Fargo was unsuccessful in crafting a 

complaint that named all of the real parties in interest and 

also preserved diversity of citizenship. It therefore moved to 

dismiss its complaint voluntarily on April 9, 2012. 
8 Nos. 14-2150 & 14-2287 

3. 

Prior to Wells Fargo’s voluntary dismissal of the remanded action, Saybrook had filed a twenty-four-count 

complaint against the Corporation, Stifel, and Godfrey in 

Waukesha County Circuit Court, in which it asserted a 

breach of bond claim against the Corporation and various 

alternative claims against the other defendants. The language of the Bond Documents, however, allowed the parties 

to bring suit against the Tribal Entities in state court only in 

the event that the District Court for the Western District of 

Wisconsin failed to exercise jurisdiction.7 Consequently, on 

the same day that Wells Fargo voluntarily dismissed the remanded federal action, Saybrook filed a complaint in federal 

district court (“Saybrook federal action”) for the purpose of 

obtaining the court’s ruling on its subject matter jurisdiction. 

See Saybrook Tax Exempt Investors v. Lake of the Torches Econ. 

Dev. Corp., 929 F. Supp. 2d 859, 860 (W.D. Wis. 2013). The 

state action was stayed pending the federal court’s determination of its jurisdiction, and the state court entered an order 

(agreed upon by the parties) extending the defendants’ 

deadlines for answering or responding to the state court 

complaint until forty-five days after the district court made a 

 

7 Specifically, the Specimen Bond provided that “[t]he Corporation expressly submits to and consents to the jurisdiction of the United States 

District Court for the Western District of Wisconsin (including all federal 

courts to which decisions of the Federal District Court for the Western 

District of Wisconsin may be appealed), and, in the event (but only in the 

event) the said federal court fails to exercise jurisdiction, the courts of the 

State of Wisconsin... .” R.1-1 at 6 (emphasis added). 
Nos. 14-2150 & 14-2287 9

determination as to its jurisdiction in the Saybrook federal 

action. 

On March 11, 2013, the District Court for the Western 

District of Wisconsin determined that Saybrook’s claims 

were for breach of the bond and therefore did not raise a 

federal question. The court also believed that it was unlikely 

that there was diversity of citizenship, but it required proof 

of the plaintiffs’ citizenship in order to completely rule out 

diversity of citizenship as a basis for subject matter jurisdiction. Id. Following the submission of supplemental affidavits 

establishing a lack of complete diversity, the district court 

dismissed the Saybrook federal action without prejudice on 

April 1, 2013. 

4. 

Following the district court’s March 11 ruling in the 

Saybrook federal action, the Tribe amended its tribal code to 

expand the jurisdiction of its own tribal court. Prior to the 

amendment, the tribal code provided that the tribal court 

had jurisdiction over “[a]ll matters which the Tribal Council 

of the Lac du Flambeau Band of Lake Superior Chippewa 

invests, by appropriate ordinance, the Court with jurisdiction; [and] [a]ll actions brought under the provisions of this 

Code.”8 After the amendment, the tribal court’s jurisdiction 

extended to “all cases and controversies, both criminal and 

civil, in law or in equity, arising under the Constitution, 

laws, customs, and traditions of the Lac du Flambeau Band 

of Lake Superior Ojibwe, including...cases in which the 

 

8 R.1-12 at 7. 
10 Nos. 14-2150 & 14-2287 

Tribe, or its officials and employees shall be a party... .”9 The 

code was further amended to provide for the selection of a 

“Judge Pro Tempore” under certain circumstances.10 Most 

pertinent to the present action, the amendment allowed 

“[t]he Lac du Flambeau Tribal Council [to] appoint Judges 

Pro Tempore by majority vote...[t]o fill the role of a standing 

Trial Judge in any case to which the Tribe or any agency or 

enterprise of the Tribe is a party and an opposing party is a 

non-member of the Tribe.”11 

5. 

On April 25, 2013, the Tribal Entities filed suit in tribal 

court against Saybrook, Wells Fargo, Stifel, and Godfrey 

seeking a declaration that all bond-related documents were 

void under the IGRA and under tribal law. The Tribe appointed as Judge Pro Tempore Professor Matthew L.M. 

Fletcher, a professor of Indian law from Michigan State University College of Law. The Financial Entities and Godfrey 

responded to the action on May 24, 2013, by filing motions to 

dismiss, which contested the jurisdiction of the tribal court. 

These motions were denied by the tribal court in an opinion 

issued on August 27, 2013. 

Following the filing of their tribal court action, the Tribal 

Entities moved to stay the state action in Waukesha County 

Circuit Court and to hold an inter-jurisdictional conference 

with the tribal court under Teague v. Bad River Band of Lake 

 

9 R.1-13 at 7. 

10 See id. at 8. 

11 Id. 
Nos. 14-2150 & 14-2287 11

Superior Tribe of the Chippewa Indians, 612 N.W.2d 709 (Wis. 

2000).12 The state court denied that motion, and the state appellate court denied the Tribal Entities an interlocutory appeal. 

B. District Court Proceedings 

On the same day that the Financial Entities and Godfrey 

filed their motions to dismiss the tribal court action, they also instituted this action in the District Court for the Western 

District of Wisconsin. They sought a ruling that the tribal 

court did not have jurisdiction over them and moved for a 

preliminary injunction to prevent the tribal court action from 

proceeding. 

Following extensive briefing and a hearing, the district 

court ruled on the Financial Entities’ and Godfrey’s motion. 

Before it turned to the four-factor analysis for preliminary 

injunctions, however, the court addressed two threshold issues raised by the Tribal Entities: sovereign immunity and 

tribal exhaustion. 

1. 

With respect to the waivers of sovereign immunity in the 

Bond Documents, the district court agreed with the Tribal 

Entities that several of the Bond Documents were unap-

 

12 In Teague v. Bad River Band of Lake Superior Tribe of the Chippewa Indians, 

612 N.W.2d 709, 719 (Wis. 2000), the Supreme Court of Wisconsin concluded that, when there are concurrent state and tribal actions, as a matter of comity, the two courts should confer for purposes of allocating jurisdiction between the two sovereigns. 
12 Nos. 14-2150 & 14-2287 

proved management contracts under the IGRA and, therefore, that both the documents and the waivers were void. 

The district court determined, however, that there were at 

least two Bond Documents—the Tribal Resolution and the 

Bond Resolution—that were not management contracts under the IGRA, and did contain clear waivers of the Tribe’s 

sovereign immunity. It concluded, therefore, that the Tribal 

Entities had waived their sovereign immunity. 

The court then turned to the second threshold question—

exhaustion of tribal remedies. Guided by this court’s decision in Altheimer & Gray v. Sioux Manufacturing Corp., 983 

F.2d 803 (7th Cir. 1993), the court stated that it must look to 

the circumstances of the case “‘to determine whether the issue in dispute is truly a reservation affair entitled to the exhaustion doctrine.’”13 The court explained that, 

[a]s in Altheimer, the Tribe and the Corporation 

alike agreed to litigate disputes involving the 

Bond Documents or the Bond Transaction, like 

this one over enforcement of the provisions of 

the Bonds themselves, in Wisconsin’s federal 

or state courts, and they agreed that the law of 

Wisconsin should apply to such litigation. In 

the words of the Altheimer court, by doing so, 

the defendants apparently “wished to avoid 

characterization of the contract as a reservation 

affair by actively seeking the federal forum.”[14]

 

13 R.175 at 19 (quoting Altheimer & Gray v. Sioux Mfg. Corp., 983 F.2d 803, 

815 (7th Cir. 1993)). 

14 Id. at 19–20 (quoting Altheimer & Gray, 983 F.2d at 815).
Nos. 14-2150 & 14-2287 13

The court therefore held that the Financial Entities and Godfrey did not have to exhaust tribal court remedies with respect to disputes regarding the Bond Documents and Transaction. 

2. 

Proceeding to the merits, the court observed that the Financial Entities and Godfrey bore the burden of demonstrating that: (1) they have a reasonable likelihood of success on 

the merits; (2) they have no adequate remedy at law; and (3) 

they will suffer irreparable harm without injunctive relief. If 

they met this burden, then they also would have to establish 

that the harm they would suffer outweighed any harm the 

Tribal Entities would suffer and that the preliminary injunction would not harm the public interest. 

With respect to the Financial Entities’ motion for injunctive relief, the court believed that the merits inquiry was 

governed by the Supreme Court’s decision in Montana v. 

United States, 450 U.S. 544 (1981). The court explained that 

Montana established the general presumption against tribal 

court jurisdiction over nonmembers as well as two exceptions to the presumption. First, tribes “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.”15 According to the court, the 

Supreme Court had made clear that the focus of the first 

Montana exception was on nonmember conduct on Indian 

 

15 Id. at 26 (quoting Montana v. United States, 450 U.S. 544, 565 (1981)). 
14 Nos. 14-2150 & 14-2287 

land and that “the touchstone” of the Montana exceptions 

was “the tribe’s interests in protecting internal relations and 

self-governance.”16 The district court observed that the Financial Entities’ on-reservation conduct had been “minimal, 

particularly with respect to Saybrook.”17 Although, with respect to Stifel, “the question [wa]s arguably closer,” nevertheless, there was “no evidence presented that any negotiations with respect to the Bond Transaction or Documents 

took place on tribal land.”18 “In the end,” the court noted, 

the Tribal Entities only had pointed to “the mere fact of a 

commercial relationship” that did not implicate the Tribe’s 

sovereign interests.19 The district court concluded “that this 

relationship alone, without more, [wa]s likely not enough” 

to support tribal court jurisdiction.20

Focusing on the second Montana exception, the district 

court noted that this exception is limited to non-Indians’ 

conduct on reservation land. The tribal action at issue, however, did not seek to regulate the Financial Entities’ conduct 

on reservation land. Moreover, this exception “was effectively intended ‘to protect tribal self-government or to control 

internal relations.’”21 Because paying the bonds would not 

jeopardize “the [T]ribe’s right to self-governance,”22 the tribal 

 

16 Id. at 28. 

17 Id. at 29.

18 Id.

19 Id. at 30. 

20 Id.

21 Id. at 32 (quoting Strate v. A-1 Contractors, 520 U.S. 438, 459 (1997)). 

22 Id. at 33.
Nos. 14-2150 & 14-2287 15

court action did not fall within the second Montana exception. 

Having determined that the Financial Entities were likely 

to prevail on their claim that the tribal court lacked jurisdiction over them, the district court proceeded to the other preliminary-injunction factors. It found that the Financial Entities would suffer irreparable harm if they were “forced to 

litigate in two forums, expending significant effort and resources,” were “deprived of the benefits of the forum for 

which they expressly contracted,” and were “forced to litigate before...a court that likely lacks jurisdiction over 

them.”23 The district court similarly found that the balance of 

the harms and the public interest weighed in favor of issuing 

the injunction. The court rejected the notion that “entry of an 

injunction w[ould] undercut the autonomy both of the Tribe, 

as a sovereign nation, and of the state court.”24 The court explained that “[t]o enforce the various waivers...is not to undercut the autonomy of a sovereign nation; it is to hold the 

Tribe and the Corporation to the terms to which they agreed 

when entering into the Bond Transaction.”25 The district 

court, therefore, granted the Financial Entities’ motion for a 

preliminary injunction. 

 

23 Id. at 49. 

24 Id. at 50. 

25 Id.
16 Nos. 14-2150 & 14-2287 

3. 

With regard to Godfrey, however, the district court 

reached a different conclusion. For purposes of the preliminary-injunction proceedings, Godfrey did not contest the 

tribal court’s jurisdiction under Montana; rather, it based its 

challenge on the forum selection clauses found in the Bond 

Documents.26 Because Godfrey’s forum-selection-clause argument was based in state contract law, the district court determined that it did not have subject matter jurisdiction over 

Godfrey’s action. Moreover, although the court could have 

exercised supplemental jurisdiction over Godfrey’s claim 

pursuant to 28 U.S.C. § 1367(a), the court was disinclined to 

do so because, it determined, it likely would resolve the Financial Entities’ federal claims without a full trial on the 

merits. Finally, the district court continued, even if it were to 

ignore the jurisdictional concerns, Godfrey had not established a substantial likelihood of success on the merits. Most 

troubling to the district court was that the Bond Document 

on which Godfrey relied most heavily—the Tribal Agreement—contained provisions that rendered it a “management 

contract” under the IGRA. Although other documents, such 

as the Specimen Bond, did not raise those concerns, the 

Specimen Bond’s forum selection clause applied only to the 

 

26 In particular, Godfrey stipulated that it would “not contend in connection with the motion for a preliminary injunction in this action that the 

Tribal Court does not have jurisdiction over it under Montana v. United 

States, 450 U.S. 544 (1981).” R.131 at 2. This stipulation was solely “for the 

purposes of the motion for preliminary injunction in this action only.” Id. 

at 1. The stipulation, Godfrey made clear, did not prevent it from challenging the Tribal Court’s jurisdiction over it “in light of the forum selection provisions contained in” the various Bond Documents involved in 

the parties’ transaction. Id. at 2. 
Nos. 14-2150 & 14-2287 17

Corporation and not the Tribe. Therefore, the district court 

concluded that Godfrey was likely to enjoy “partial success 

[on the merits] at best.”27 Accordingly, it denied Godfrey’s 

motion for a preliminary injunction. 

Following the district court’s ruling, the Tribal Entities 

appealed the district court’s order granting a preliminary 

injunction to the Financial Entities, and Godfrey filed a 

cross-appeal challenging the district court’s denial of its motion for a preliminary injunction.28

II 

DISCUSSION 

Before we turn to the propriety of injunctive relief, we, 

like the district court, must consider whether the parties’ 

dispute is properly before us; that is, we must address the 

threshold issue of whether the district court should have deferred to the tribal court under the tribal exhaustion rule. Because we agree with the district court that tribal exhaustion 

was not warranted under the circumstances presented here, 

we proceed to the second threshold issue: whether the Tribal 

Entities waived their sovereign immunity. We conclude that 

there was a valid waiver of sovereign immunity. Lastly, 

therefore, we consider whether the district court abused its 

discretion in granting the Financial Entities injunctive relief 

and in denying the same to Godfrey. 

 

27 R.175 at 47–48. 

28 The district court’s jurisdiction was premised on 28 U.S.C. § 1331. Our 

jurisdiction is premised on 28 U.S.C. §§ 1291 and 1292(a)(1). 
18 Nos. 14-2150 & 14-2287 

A. Exhaustion 

The concept of federal court abstention in cases involving 

Indian tribes, known as the tribal exhaustion rule, “requires 

litigants, in some instances, to exhaust their remedies in tribal courts before seeking redress in federal courts.” Altheimer 

& Gray, 983 F.2d at 812. It is not, however, “‘a jurisdictional 

prerequisite,’ but rather is ‘a matter of comity.’” Id. at 813 

(quoting Iowa Mut. Ins. Co. v. LaPlante, 480 U.S. 9, 16 n.8 

(1987)). Relying on our decision in Altheimer & Gray, the district court determined that exhaustion of tribal remedies was 

not required here. We begin, therefore, with Altheimer & 

Gray.

29

1. 

In Altheimer & Gray, the Devils Lake Sioux Tribe had created the Sioux Manufacturing Corporation (“SMC”) to manufacture and market certain clothing products. The Tribe 

then negotiated with Medical Supplies & Technology, Inc. 

(“MST”) to manufacture and market latex medical products 

on the reservation. A letter of intent contemplated that (1) 

SMC would purchase MST’s assets, (2) MST would provide 

consulting services to SMC, and (3) SMC would pay MST a 

percentage of its profits. The letter also provided that the 

Tribe waived all sovereign immunity with respect to contractual disputes, that all of the documents were executed 

and would be interpreted according to the laws of Illinois, 

 

29 We review the district court’s exhaustion ruling de novo. See Garcia v. 

Akwesasne Hous. Auth., 268 F.3d 76, 79 (2d Cir. 2001). 
Nos. 14-2150 & 14-2287 19

and that all parties agreed to submit to the venue and jurisdiction of the federal and state courts located in the State of 

Illinois. After the letter of intent was signed, MST began 

business operations, but the closing of the transaction never 

took place. MST later ceased operations within the reservation and sued SMC in Illinois state court for breach of contract. MST’s law firm, Altheimer & Gray, also filed suit seeking its fees for the negotiations. SMC removed the action to 

district court and moved for summary judgment on the 

ground that the contract was null and void under 25 U.S.C. 

§ 81, a statute that required contracts concerning Indian 

lands to be approved by the Secretary of the Interior. The 

district court entered judgment for SMC, and Altheimer & 

Gray appealed. 

Before us, SMC urged that we affirm the judgment because, among other reasons, Altheimer & Gray had failed to 

exhaust its tribal court remedies. We determined, however, 

that tribal exhaustion was not required. First, it was not clear 

that tribal exhaustion applied in the absence of a first-filed 

tribal action. See Altheimer & Gray, 983 F.2d at 814. Assuming 

applicability of that doctrine, however, the exhaustion inquiry was fact sensitive: exhaustion does not apply unless 

“the issue in dispute is truly a reservation affair.” Id. Turning 

to the facts before us, we observed that, with respect to SMC 

and Altheimer & Gray, 

the principal dispute...concerns the application 

of a federal statute, 25 U.S.C. § 81, to the Letter 

of Intent. The other issues in this litigation concern a contract that both parties agreed would 

be interpreted under Illinois law. To apply the 

tribal exhaustion rule would place before the 
20 Nos. 14-2150 & 14-2287 

tribal court a dispute that must be resolved by 

laws of distant jurisdictions. 

Id. Although the choice of law provision did not “foreclose 

application of the tribal exhaustion rule,” this fact did distinguish the case then before us from cases in which the Supreme Court had required exhaustion. Id. 

“More important[],” however, than the presence of a 

choice of law provision or a first-filed tribal action was the 

fact that “the application of the tribal exhaustion rule would 

not serve the policies” that the Supreme Court had articulated in Iowa Mutual Insurance Co., 480 U.S. 9, and National 

Farmers Union Insurance Cos. v. Crow Tribe of Indians, 471 U.S. 

845 (1985). Altheimer & Gray, 983 F.2d at 814–15 (emphasis 

added). In these cases, “the Supreme Court was concerned 

with implementing Congress’s policy of tribal selfgovernment. The Court feared that ‘unconditional access to 

the federal forum would place it in direct competition with 

the tribal courts, thereby impairing the latter’s authority 

over reservation affairs.’” Id. at 815 (quoting Iowa Mutual Insurance Co., 480 U.S. at 16). This was not the case in Altheimer 

& Gray, where “the tribal entity wished to avoid characterization of the contract as a reservation affair by actively seeking the federal forum.” Id. We noted that, 

[i]n the Letter of Intent, Sioux Manufacturing 

Corporation explicitly agreed to submit to the 

venue and jurisdiction of federal and state 

courts located in Illinois. To refuse enforcement of 

this routine contract provision would be to undercut the Tribe’s self-government and selfdetermination. The Tribe created SMC to enhance employment opportunities on the reser-
Nos. 14-2150 & 14-2287 21

vation. As the Ninth Circuit recognized, economic independence is the foundation of a 

tribe’s self-determination. If contracting parties 

cannot trust the validity of choice of law and 

venue provisions, SMC may well find itself 

unable to compete and the Tribe’s efforts to 

improve the reservation’s economy may come 

to naught. We therefore affirm the district 

court’s denial of SMC’s motion for a stay of 

proceedings based on the tribal exhaustion 

rule. 

Id. (emphasis added). 

2. 

The Tribal Entities maintain that Altheimer & Gray is distinguishable in several respects. According to the Tribal Entities, the rule articulated in Altheimer & Gray—that the exhaustion rule does not apply when a non-tribal forum has 

been designated by contract—is applicable only to situations 

where no tribal action is pending. 

We cannot reconcile this argument with our approach in 

Altheimer & Gray. In that case, we noted that there was a split 

of authority as to whether exhaustion was required when 

there was no pending tribal case. Nevertheless, we assumed 

that the tribal exhaustion doctrine applied in both circumstances—when there was a tribal action pending and when 

there was not. Assuming the general applicability of the 

tribal exhaustion rule, therefore, we went on to consider 

whether tribal exhaustion was appropriate under the facts 

presented. In doing so, we drew on the Supreme Court’s 
22 Nos. 14-2150 & 14-2287 

discussions of tribal exhaustion in both Iowa Mutual Insurance 

Co. and National Farmers Union Ins. Cos.—cases in which 

there were competing tribal actions. Consequently, our reasoning in Altheimer & Gray is not limited to situations in 

which there is no competing tribal proceeding. 

The Tribal Entities also contend that, unlike in Altheimer 

& Gray, the present action “raises significant issues of tribal 

law.”30 In the tribal action, the Tribal Entities seek to void the 

Bond Documents under tribal law, the IGRA, and the tribal 

constitution.31 The central issue, however, is whether the 

Bond Documents constitute management contracts under 

the IGRA. If they are not management contracts, then the forum selection and choice-of-law clauses require that any 

disputes related to the bonds be resolved in Wisconsin 

courts and be governed by Wisconsin law. If they are management contracts, then, following this court’s decision in 

Wells Fargo, they are void, and the court need not reach the 

question of their validity under tribal law. Thus, as in Altheimer & Gray, “the principal dispute between the parties 

concerns the application of a federal statute.” 983 F.2d at 814. 

Finally, the Tribal Entities maintain that the Bond Documents do not evince an explicit agreement to submit to the 

jurisdiction and venue of the Wisconsin courts. We do not 

believe this is a fair reading of the Bond Documents. Although the documents do not use identical language, the 

Tribal Agreement and the Specimen Bond both provide: 

 

30 Appellants’ Br. 23. 

31 See R.1-14 at 28–32. 
Nos. 14-2150 & 14-2287 23

The Corporation expressly submits to and consents to the jurisdiction of the United States 

District Court for the Western District of Wisconsin (including all federal courts to which 

decisions of the Federal District Court for the 

Western District of Wisconsin may be appealed), and, in the event (but only in the 

event) the said federal court fails to exercise jurisdiction, the courts of the State of Wisconsin 

wherein jurisdiction and venue are otherwise 

proper, for the adjudication of any dispute or 

controversy arising out of this Bond, the Indenture, or the Bond Resolution and including any 

amendment or supplement which may be 

made thereto, or to any transaction in connection therewith, to the exclusion of the jurisdiction 

of any court of the Corporation.

[32]

 

Given that the Tribal Entities have consented to the jurisdiction of the Wisconsin courts (federal or state) to the exclusion 

 

32 R.1-1 at 6 (Specimen Bond) (emphasis added); R.1-9 at 6 (Tribal 

Agreement) (stating that “[t]he Tribe expressly submits to and consents 

to the jurisdiction of the United States District Court for the Western District of Wisconsin...to the exclusion of the jurisdiction of any court of the 

Tribe”). Moreover, the Tribal Resolution “resolve[s] that all Legal Provisions in the Tribal Agreement are hereby approved; more specifically and expressly, those by which the Tribe...consents to the jurisdiction: of the 

United States District Court for the Western District of Wisconsin...and 

the courts of the State of Wisconsin wherein jurisdiction and venue are 

otherwise proper.” R.1-10 at 3 (emphasis added); see also R.1-5 at 4 (Bond 

Resolution) (stating that “more specifically and expressly the Corporation...consents to the jurisdiction of the United States District Court for 

the Western District of Wisconsin”).
24 Nos. 14-2150 & 14-2287 

of any tribal courts, and given that the Tribal Entities do not 

suggest that any other courts have jurisdiction over bondrelated disputes, these disputes must be resolved in the federal or state courts of Wisconsin. 

3. 

Alternatively, the Tribal Entities maintain that, assuming 

Altheimer & Gray governs the present dispute, it requires the 

Financial Entities to exhaust tribal remedies. According to 

the Tribal Entities, “the tribal-court action implicates...the 

validity of a fraudulently induced Bond Transaction executed in violation of both tribal and federal law, which, if enforced, will consume the tribal Casino’s revenue and cripple 

the tribal government.”33 They point to several cases from 

other circuits in which, they maintain, the courts have required exhaustion under similar circumstances. 

A number of the cases on which the Tribal Entities rely 

are readily distinguishable.34 Others, arguably, are more fac-

 

33 Appellants’ Br. 25. 

34 For instance, National Farmers Union Insurance Cos. v. Crow Tribe of Indians, 471 U.S. 845 (1985), involved an insurance company’s jurisdictional 

challenge to a tort suit brought by a tribal member in tribal court where 

the tribal court already had entered a default judgment. Unlike the present case, there was no contractual waiver of exhaustion or agreement to 

litigate in a non-tribal forum. Under those circumstances, the Court determined that, in light of congressional policies “supporting tribal selfgovernment and self-determination,” the insurance companies defending the action should have to exhaust tribal remedies. Id. at 856; see also, 

e.g., Davis v. Mille Lacs Band of Chippewa Indians, 193 F.3d 990, 991–92 (8th 

Cir. 1999) (requiring tribal court exhaustion with respect to employment 

dispute between a member of the tribe and the tribe itself); Basil Cook 
Nos. 14-2150 & 14-2287 25

tually analogous to the circumstances at hand.35 In any 

event, with the advent of Altheimer & Gray, the presence of a 

forum selection clause is dispositive of the exhaustion issue: 

“To refuse enforcement of this routine contract provision 

would be to undercut the Tribe’s self-government and selfdetermination.” 983 F.2d at 815; see also Ninigret Dev. Corp. v. 

Narragansett Indian Wetuomuck Hous. Auth., 207 F.3d 21, 33 

(1st Cir. 2000) (noting that, in Altheimer & Gray, the court 

 

Enters., Inc. v. St. Regis Mohawk Tribe, 117 F.3d 61, 66 (2d Cir. 1997) (requiring exhaustion in an action brought by two members of the tribe 

against the tribe and tribal leaders with “virtually all the events giving 

rise to the litigation occur[ing] on reservation lands”); United States ex rel.

Kishell v. Turtle Mountain Hous. Auth., 816 F.2d 1273, 1276 (8th Cir. 1987) 

(requiring exhaustion in an action brought on behalf of the estate of an 

enrolled member of the tribe against a tribal entity concerning land situated within the reservation). 

35 The Tribal Entities, for example, rely on Bruce H. Lien Co. v. Three Affiliated Tribes, 93 F.3d 1412 (8th Cir. 1996). In that case, the Tribes had contracted with a nonmember company for the management of an onreservation casino. The agreement between the parties included an “unequivocal[] waive[r of] their sovereign immunity” as well as a binding 

arbitration provision, and “[t]he District Court of North Dakota was the 

selected forum in which to bring an action for injunctive relief.” Id. at 

1417. When a disagreement arose between the parties, the management 

company filed a demand for binding arbitration, followed by the Tribes 

filing an action in tribal court in which they challenged the validity of the 

contract under tribal law. The Eighth Circuit concluded that the dispute 

concerned a matter related to reservation affairs requiring exhaustion of 

tribal remedies: “In this case many of the parties are Tribal entities or 

members and the dispute arises from Tribal governmental activity involving a project located within the borders of the reservation.” Id. at 

1420. The presence of the forum selection clause in the contract did not 

alter the analysis because “in the present situation the Tribes are challenging the very validity of the agreement containing language giving 

the Tribal Court limited jurisdiction.” Id. at 1421. 
26 Nos. 14-2150 & 14-2287 

held that “the tribal exhaustion doctrine did not apply to a 

forum-selection clause in a contract between a non-Indian 

corporation and an Indian manufacturing company”). Furthermore, the fact that a contract may have been procured by 

fraud does not negate the validity of a forum selection 

clause; instead, we look to whether “a forum selection 

clause...itself was procured by fraud.” Muzumdar v. Wellness 

Int’l Network, Ltd., 438 F.3d 759, 762 (7th Cir. 2006) (emphasis 

added);36 see also Rucker v. Oasis Legal Fin., L.L.C., 632 F.3d 

1231, 1238 (11th Cir. 2011) (observing that “[a] forum selection clause is viewed as a separate contract that is severable 

from the agreement in which it is contained,” and, therefore, 

an allegation that the clause was a part of an agreement that 

was “void as [an] illegal gambling contract[] under Alabama 

law” did not affect the validity of the forum selection 

clause).37

 

36 In their reply brief, the Tribal Entities acknowledge the holding in 

Muzumdar v. Wellness International Network, Ltd., 438 F.3d 759 (7th Cir. 

2006), but maintain that “reliance on Muzumdar...and cases concerning 

fraudulently induced contracts is misplaced” because those cases “concerned voidable contracts,” whereas contracts that violate the IGRA are 

void ab initio. Appellants’ Reply Br. 10 n.7. Even if there were merit to the 

Tribal Entities’ void/voidable distinction, there are Bond Documents that 

contain valid waivers of sovereign immunity and designations of venue 

but do not constitute unapproved management contracts under the 

IGRA.

37 Saybrook also maintains that exhaustion is not required because the 

tribal court’s exercise of jurisdiction is in bad faith. See Saybrook’s Br. 13. 

Because we conclude, on a different basis, that exhaustion is not required, we have no occasion to consider this argument.
Nos. 14-2150 & 14-2287 27

In sum, we conclude that, consistent with the approach 

we adopted in Altheimer & Gray, exhaustion of tribal remedies is not required. 

B. Waiver of Sovereign Immunity 

The Tribal Entities also maintain that the district court 

erred in holding that they had waived their sovereign immunity. They assert first that they were fraudulently induced to enter the bond transaction, and, therefore, any 

waivers contained in the Bond Documents are unenforceable. Second, they maintain that the Bond Documents did not 

waive their sovereign immunity. Finally, they contend that 

the documents containing the waivers are unapproved management contracts under the IGRA and, therefore, are not 

enforceable. 

1. Fraudulent inducement 

The Tribal Entities first fault the district court for considering the validity of the waivers of sovereign immunity in 

the Bond Documents without first considering whether the 

entire bond transaction was the product of fraudulent inducement. Because our analysis of this issue rests on the 

manner in which the issue of fraud was raised in the district 

court, we first set forth the procedural history of the Tribal 

Entities’ fraud allegations. 

a. 

The Financial Entities filed their federal complaint on 

May 24, 2013, and filed their motion for injunctive relief on 
28 Nos. 14-2150 & 14-2287 

the same day. In response, the Tribal Entities filed a motion 

to dismiss, in which they argued that the Bond Documents 

did not waive their sovereign immunity, and, even if they 

did, they nevertheless were unenforceable as unapproved 

management contracts under the IGRA. Notably, the Tribal 

Entities did not argue that the Bond Documents were unenforceable because they were the product of fraud. Similarly, 

the Tribal Entities’ briefs in opposition to the motions for 

preliminary injunction and their reply brief in support of 

their motion to dismiss also made no argument with respect 

to fraud. On October 29, 2013, the district court denied the 

Tribal Entities’ motion to dismiss. In the same order, the 

court set a hearing on the preliminary injunction for November 26, 2013. 

The Tribal Entities filed an interlocutory appeal with respect to the denial of their motion to dismiss, which we dismissed for want of jurisdiction on January 13, 2014. On January 14, 2014, the Tribal Entities and Godfrey then requested 

that the district court “set a new date for the previously scheduled and fully-briefed hearing on plaintiffs’ Motion for Preliminary Injunction, to occur as soon as possible after February 

21, 2014.”38 The preliminary-injunction hearing was re-set 

for February 24, 2014. By request of the Tribal Entities, the 

date was then moved to March 14, 2014. 

On February 12, 2014, the Tribal Entities filed a counterclaim, answer, and affirmative defenses. Among the defenses raised were that “[t]he Bond Transaction was procured by 

fraud and the Tribal [Entities] were fraudulently induced to 

enter into it and therefore should be relieved of any obliga-

 

38 R.92 (emphasis added). 
Nos. 14-2150 & 14-2287 29

tion to perform thereunder.”39 Attached to the counterclaim 

was a transcript of a tribal meeting in which Kevin Shibilski, 

a representative of Stifel, allegedly made misrepresentations 

concerning the bond transaction. 

On February 21, 2014, Saybrook moved the “Court in 

limine to exclude argument and evidence regarding alleged 

fraud as a defense to a preliminary injunction order.”40

Saybrook noted that the Tribal [Entities] had attached 377 

pages of exhibits to their counterclaim, only fifteen of which 

had been mentioned in the preliminary-injunction briefing. 

According to Saybrook, “it [wa]s far too late...for the Tribal 

[Entities] to raise a highly fact-intensive affirmative defense 

of fraud rooted in allegations entirely unrelated to those that 

have been briefed to date.”41

The court held a status conference on February 28, 2014, 

to address issues related to the preliminary-injunction hearing and the parties’ motions in limine.42 The court granted in 

part and denied in part Saybrook’s motion in limine, allowing the “defendants...[to] raise fraud at the hearing, but only 

to the extent they have proposed facts in response to plaintiffs’ proposed findings of fact that support this claim.”43 The ruling, 

however, was limited to the court’s consideration of the motion for a preliminary injunction and did not preclude the 

Tribal Entities from raising fraud as a defense in the case. 

 

39 R.99 at 14. 

40 R.109 at 1. 

41 Id. at 4. 

42 See R.127 at 1. 

43 Id. at 2 (emphasis added). 
30 Nos. 14-2150 & 14-2287 

Following the preliminary-injunction hearing, the parties 

filed evidence for the court to consider in making its ruling. 

The Tribal Entities designated portions of the deposition of 

David DeYoung, Stifel’s designee under Federal Rule of Civil Procedure 30(b)(6), in which he had been asked to comment on allegedly fraudulent statements made by Shibilski 

during the tribal meeting. 

b. 

With this background in mind, we turn to an assessment 

of the Tribal Entities’ fraud-in-the-inducement argument. 

Specifically, they maintain that the district court erred “[b]y 

refusing to consider the effect of fraud on the purported 

waivers.”44 There is no question that fraud in the inducement bears on the enforceability of the contractual provisions. See First Nat’l Bank & Trust Co. of Racine v. Notte, 293 

N.W.2d 530, 538 (Wis. 1980) (noting that fraud in the inducement renders a contract voidable). The court readily 

acknowledged this consideration and allowed the Tribal Entities to “plead[] fraud in the inducement as a defense in the 

case.”45 It did circumscribe, however, the Tribal Entities’ 

presentation of evidence of fraud with respect to the preliminary injunction; for purposes of the preliminary injunction, 

the district court refused to expand the hearing beyond 

those issues which the Tribal Entities previously had raised 

and briefed. 

 

44 Appellants’ Br. 43.

45 R.127 at 2.
Nos. 14-2150 & 14-2287 31

“District court judges, because of the very nature of the 

duties and responsibilities accompanying their position possess great authority to manage their caseload.” Gonzalez v. 

Ingersoll Mill. Mach. Co., 133 F.3d 1025, 1030 (7th Cir. 1998) 

(quoting United States v. Reed, 2 F.3d 1441, 1447 (7th Cir. 

1993)). The Tribal Entities do not maintain that the district 

court abused its discretion in setting a briefing schedule or 

requiring the parties to submit proposed findings of fact. 

Moreover, they do not claim either that the Financial Entities 

impeded their ability to obtain evidence needed to raise the 

defense during the course of preliminary-injunction briefing 

or that the district court did not provide them with adequate 

time to develop their arguments. We must conclude, therefore, that the district court did not abuse its discretion in refusing to allow the Tribal Entities to expand the factual and 

legal parameters of the preliminary-injunction hearing. 

c. 

Because the district court did not abuse its discretion in 

limiting the presentation of evidence and argument concerning the preliminary injunction, the Tribal Entities are limited 

to arguing that DeYoung’s deposition testimony establishes 

that the Tribal Entities were fraudulently induced into entering the bond transaction. The evidence, however, does not 

support such a conclusion. 

We have recognized that, 

[f]or claims of rescission based on fraud in the 

inducement, the Wisconsin Supreme Court follows the rule set forth in the Restatement (Second) of Contracts: “If a party’s manifestation of 
32 Nos. 14-2150 & 14-2287 

assent is induced by either a fraudulent or a 

material misrepresentation by the other party 

upon which the recipient is justified in relying, 

the contract is voidable by the recipient.” 

Archdiocese of Milwaukee v. Doe, 743 F.3d 1101, 1105 (7th Cir. 

2014) (quoting Restatement (Second) of Contracts § 164(1) 

(1981)). A fraud plaintiff bears the burden of proving these 

elements by clear and convincing evidence. See Lundin v. 

Shimanski, 368 N.W.2d 676, 681 (Wis. 1985). 

DeYoung’s deposition testimony, standing alone, does 

not satisfy the Tribal Entities’ burden. First, DeYoung’s testimony does not establish that Shibilski’s statements were 

“fraudulent or [] material misrepresentation[s].” Archdiocese 

of Milwaukee, 743 F.3d at 1105. Although in his deposition, 

DeYoung seems to want to distance himself from Shibilski’s 

statements, in most instances, he stops short of stating that 

Shibilski’s statements were false. Second, the Tribal Entities 

point to no evidence in the record that they relied on these 

specific misstatements in approving the bond transaction, 

much less evidence that would establish their reliance by 

clear and convincing evidence. 

2. Waiver language in the Bond Documents 

The Tribal Entities also argue that the Bond Documents 

relied upon by the district court—the Tribal Resolution and 

Bond Resolution—do not contain valid waivers of sovereign 

immunity. Relying on State of Wisconsin v. Baker, 698 F.2d 

1323 (7th Cir. 1983), the Tribal Entities further maintain that 

the Tribal and Bond Resolutions only approve waivers in 

other documents; they do not purport to be independent 
Nos. 14-2150 & 14-2287 33

waivers of sovereign immunity. Finally, even if they constitute valid waivers of sovereign immunity, they are not broad 

enough to encompass an action by the Financial Entities. We 

do not find any of these arguments persuasive. 

As a preliminary matter, the Tribal Entities’ suggestion 

that the district court believed that only two documents provided unequivocal waivers is incorrect. While noting that 

“[t]wo individual Bond Documents in particular stand out as 

providing an unequivocal, independent waiver of the Tribe’s 

sovereign immunity,”46 the district court mentioned several 

documents that “unambiguously state[] not only that defendants have waived sovereign immunity but also that they 

consent to jurisdiction in this court,”47 including the Specimen Bond, the Bond Purchase Agreement, the Bond Resolution, and the Tribal Resolution. 

Moreover, Baker does not support the Tribal Entities’ assertion that the resolutions are ineffective as waivers of sovereign immunity. In Baker, the defendants, “in their capacity 

as members of the Band’s governing board[,] adopted a resolution authorizing their attorneys of record to waive the 

Band’s sovereign immunity to this suit.” Id. at 1331. We held 

that this “resolution purport[ed] only to delegate to defendants’ appellate attorneys the power to waive the Tribe’s immunity to this suit” and that, based on the record before us, 

it did not appear “that defendants’ attorneys ever exercised 

the power delegated to them.” Id. Here, in contrast, the Resolutions do not authorize a future action that never occurred. 

Instead, the Resolutions affirmatively approve and 

 

46 R.175 at 14 (emphasis added). 

47 Id. at 9. 
34 Nos. 14-2150 & 14-2287 

acknowledge actions that already have been taken, namely 

that the Tribe has “provide[d] a limited waiver of sovereign 

immunity from suit.”48 The distinction drawn in Baker, therefore, simply has no applicability here. 

The Tribal Entities also maintain that, assuming the Resolutions can operate as waivers of sovereign immunity, the 

Resolutions do not waive sovereign immunity as to the Financial Entities. The Tribal Entities argue that when the Resolutions are strictly construed, see Orff v. United States, 545 

U.S. 596, 601–02 (2005), they constitute a contract only with 

the Trustee, and only the Trustee can enforce its provisions. 

The language of the Resolutions is not so limited. More 

than merely establishing a contract with the Trustee, the 

Bond Resolution acknowledged that the bonds were to be 

sold to Stifel, approved all of the legal provisions in the 

Bond Documents, and, provided “more specifically and expressly” that “the Corporation...waive[d] its immunity from 

suit...with respect to any dispute or controversy arising out 

of the Indenture, the Security Agreement, the Bond Placement Agreement, the Bonds, this Bond Resolution and including any amendment or supplement which may be made 

thereto, or to any transaction in connection therewith.”49 The 

waiver is written in the broadest terms and does not suggest 

any limitation as to litigating party. 

 

 

48 R.1-10 at 3. 

49 R.1-5 at 4. 
Nos. 14-2150 & 14-2287 35

3. Validity under the IGRA 

Finally, the Tribal Entities argue that the waivers of sovereign immunity are unenforceable because the documents 

in which they appear are unapproved management contracts, which are void under the IGRA. They first note that, 

under the implementing regulations, “[t]he NICG must approve ‘any’ agreement that ‘provides for the management of 

all or part of a gaming operation.’ 25 C.F.R. § 502.15.”50 They 

maintain that all the Bond Documents are part of the same 

transaction, and, therefore, they constitute a single management contract that rises or falls as one.51 Because the Indenture is at the heart of the transaction, and because we have 

held that the Indenture is void under the IGRA, see Wells 

Fargo Bank, 658 F.3d at 702, the remainder of the Bond Documents also are void. 

This argument, however, is foreclosed by our decision in 

Wells Fargo, 658 F.3d at 701. In that case, after we concluded 

that the Indenture was void as an unapproved management 

contract, we turned to the district court’s determination that, 

because the various transactional documents were collateral 

to the Indenture and because they incorporated by reference 

the Indenture’s terms, “the entire transaction, including all 

collateral agreements, required the Chairman’s approval, 

and the bonds themselves were also management contracts 

subject to the Act’s approval requirement.” Id. We disagreed: 

We do not believe that this analysis can support the district court’s decision. As our col-

 

50 Appellants’ Br. 48 (footnote omitted). 

51 See also Br. of Amicus Curiae Nat’l Indian Gaming Ass’n 5–6.
36 Nos. 14-2150 & 14-2287 

leagues in the Second Circuit have held, a document collateral to a management contract “is 

subject to agency approval...only if it ‘provides 

for the management of all or part of a gaming 

operation.’” Catskill Dev. [L.L.C. v. Park Place 

Entertainment Corp.], 547 F.3d [115, 130 (2d Cir. 

2008)] (quoting 25 C.F.R. § 502.15). In our view, 

the mere reference to a related management 

contract does not render a collateral document 

subject to the Act’s approval requirement. 

Id. (footnote omitted). Thus, a document that is collateral to a 

management contract in the sense that is related does not 

require approval; it is only when that related agreement also 

provides for “the management of all or part of a gaming operation” that NIGC approval is required. 

Alternatively, the Tribal Entities contend that agency 

practice dictates that we view the Bond Documents collectively. According to the Tribal Entities, had the Bond Documents been submitted for agency approval, the NIGC 

would have reviewed the entire set of Bond 

Documents together and considered them as a 

group to ensure that none conveyed management authority... . 

After reviewing the Bond Documents together, the NIGC would have issued a ‘declination letter’ that applied to all of the Documents, 

or would refuse to issue a declination letter 

concerning any of the documents.[52]

 

 

52 Appellants’ Br. 51–52. 
Nos. 14-2150 & 14-2287 37

“Under the NIGC’s analysis,” therefore, “even if an agreement is not a management contract, it becomes one if it is 

intertwined with, and dependent upon, other agreements 

that do provide for management.”53 

Again, however, we cannot reconcile this approach with 

our decision in Wells Fargo. In Wells Fargo, we observed that 

“a document collateral to a management contract is subject 

to agency approval...only if it provides for the management 

of all or part of a gaming operation.” Id. (internal quotation 

marks omitted). The agency’s contrary practice cannot take 

precedence over the unambiguous language of the regulation.54

 

53 Id. at 52.

54 Bernard v. Casino Magic Corp., 293 F.3d 419 (8th Cir. 2002), does not 

suggest a different result. In that case, the parties (the tribe and Casino 

Magic) had submitted a consulting agreement to the NIGC for approval. 

The NIGC, however, had determined that the consulting agreement was 

not a management contract and therefore did not require approval from 

the NIGC: “While Casino Magic will be advising and consulting on 

many aspects of the gaming enterprise, pursuant to the Consulting 

Agreement the Tribe will retain ultimate control and direction of the casino operation.” Id. at 421. Later, the Tribe and BNC National Bank entered into a Construction and Term Loan Agreement. Under the terms of 

the Agreement, BNC agreed to make advances to the Tribe conditioned 

upon Casino Magic’s commitment to contribute to the loan; the Agreement also required that the Tribe “accept and comply with all of the recommendations made by the Consultant under the Consulting Agreement.” Id. at 422 (internal quotation marks omitted). When litigation later arose, the tribe argued that the Construction and Term Loan Agreements, together with the Consulting Agreement, constituted an unapproved management contract that was void under the IGRA. The Eighth 

Circuit agreed; it stated: “The Tribe’s ultimate authority...was effectively 

revoked by the terms of section 5.1(p) of the Construction and Term 
38 Nos. 14-2150 & 14-2287 

Finally, the Tribal Entities contend that, even if the court 

considers the individual documents in isolation, they nevertheless each meet the definition of a management contract. 

Because each of the Bond Documents is void, the waivers of 

sovereign immunity contained in those documents also are 

void. Specifically, the Tribal Entities argue that the Tribal 

Resolution constitutes an unapproved management contract 

because it contains a “covenant[] not to replace key management of the Casino Facility without obtaining the requisite consent of the holders of the Bonds,”55 similar to the one 

we found problematic in Wells Fargo. According to the Tribal 

Entities, this one provision is sufficient to transform the 

Tribal Resolution into a management contract for purposes 

of the IGRA. We disagree. 

In Wells Fargo, a provision of the Indenture prohibited the 

Corporation from removing or replacing (or permitting the 

removal or replacement of) key management personnel at 

the Casino “without the consent of 51% of bondholders.” 658 

F.3d at 698. We noted that “[t]his requirement applie[d] to 

removal for any reason, thus potentially tying the hands of 

the Tribe to replace key officers even when sound management or even regulatory compliance concerns require their 

removal.” Id. The language in the Tribal Resolution, however, is not as broad: The Tribal Resolution does not require 

bondholder approval to remove key management employees; 

it only requires bondholder approval for the choice of re-

 

Loan Agreement, which mandated the Tribe’s compliance with Casino 

Magic’s recommendations.” Id. at 425. Here, the documents merely reference one another; the Tribal Entities do not point to any terms in one 

document that fundamentally alter language in another. 

55 R.1-10 at 3. 
Nos. 14-2150 & 14-2287 39

placements. Consequently, the Tribal Agreement does not 

“t[ie] the hands of the Tribe” in the same manner as the Indenture did. 

Moreover, it was not the “remove and replace” provision 

in the Indenture, standing alone, that transformed it into a 

management contract under the IGRA. Rather, it was the 

numerous provisions for oversight56 “taken together” that 

rendered the Indenture a management contract. Id. at 698–

99. 

Apart from the provision not to replace key personnel, 

the Tribal Entities do not point to any problematic provisions in the Tribal Resolution. Moreover, the Tribal Entities 

do not point to any problematic provisions in the Bond 

Resolution that would transform that document into a management contract.57 Because the Tribal and Bond Resolutions 

are not void as unapproved management contracts and also 

contain waivers of sovereign immunity, the district court did 

not err in concluding that the Tribal Entities had waived 

their sovereign immunity.58 

 

56 These include: the direct deposit of the Casino’s daily gross revenues 

into a trust account managed by Wells Fargo, a requirement that capital 

expenditures above a certain amount be approved by the bondholders, 

and the appointment of an independent consultant (approved by the 

bondholder representative) in the event that the debt-service-coverage 

ratio fell below a stated level. See Wells Fargo, 658 F.3d at 698–99. 

57 Although the parties focus on the Tribal and Bond Resolutions, this 

also is true of the Specimen Bond. 

58 Because we conclude that the Tribal and Bond Resolutions were not 

void as unapproved management contracts, we need not address 

Saybrook’s alternative contention that the voiding regulation, 25 C.F.R. 

§ 533.7, is defective. See Saybrook’s Br. 35–37.
40 Nos. 14-2150 & 14-2287 

C. Tribal Court Jurisdiction 

Because we conclude that tribal court exhaustion was not 

required and that the Tribal Entities waived their sovereign 

immunity, we can proceed to the substantive issue presented 

by the Tribal Entities’ appeal: whether the district court 

properly enjoined the tribal court action because the tribal 

court lacked jurisdiction over the Financial Entities.

In Atkinson Trading Co. v. Shirley, 532 U.S. 645 (2001), the 

Supreme Court observed that “[t]ribal jurisdiction is limited: 

For powers not expressly conferred upon them by federal statute or 

treaty, Indian tribes must rely upon their retained or inherent 

sovereignty.” Id. at 649–50 (emphasis added); see also Atty’s 

Process & Investigation Servs. v. Sac & Fox Tribe of the Miss. in 

Iowa, 609 F.3d 927, 934 (8th Cir. 2010) (“Where, as here, tribal 

jurisdiction is not specifically authorized by federal statute or 

treaty, a tribe’s adjudicatory authority must stem from its ‘retained or inherent sovereignty.’” (emphasis added) (quoting 

Atkinson Trading Co., 532 U.S. at 649–50)).59 

 

59 The Tribal Entities do assert that the tribal court has jurisdiction over 

the Financial Entities based on treaty rights. However, the Tribal Entities 

do not point to any treaty language that grants the Tribe authority over 

nonmembers, much less authority “expressly conferred,” Atkinson Trading Co. v. Shirley, 532 U.S. 645, 649 (2001), or “specifically authorized,” 

Atty’s Process & Investigation Servs. v. Sac & Fox Tribe of the Miss. in Iowa, 

609 F.3d 927, 934 (8th Cir. 2010). The sole record support for their claim 

that tribal court jurisdiction is rooted in treaty rights is a citation to an 

affidavit filed by John P. Bowes, Associate Professor of History at Eastern Kentucky University, who opines that “[e]vidence indicates 

that...the government also intended the Indians to have the right to exclude individuals from the reservation if they so desired.” R.50 at 4 ¶11. 

In setting forth his opinion, Professor Bowes does not rely on treaty language, but on the statements of Commissioner Henry Gilbert made a 
Nos. 14-2150 & 14-2287 41

The scope of a tribe’s “retained or inherent authority” 

was first articulated in Montana v. United States, 450 U.S. 544, 

565 (1981): “Indian tribes retain inherent sovereign power to 

exercise some forms of civil jurisdiction over non-Indians on 

their reservations, even on non-Indian fee lands.” Specifically, the Court in Montana set forth 

two narrow situations in which a tribe may exercise jurisdiction over nonmembers: (1) “[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”; 

and (2) “[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.” Id. at 565, 566. 

Jackson v. Payday Fin., LLC, 764 F.3d 765, 782 (7th Cir. 2014) 

(parallel citation omitted). 

1. 

As an initial matter, the Tribal Entities argue that Montana only applies to situations in which tribes attempt to 

 

year after a treaty was ratified. This is not sufficient for us to conclude 

that the “tribe’s adjudicatory authority” was “specifically authorized by 

federal...treaty.” Atty’s Process & Investigation Servs., 609 F.3d at 934. 
42 Nos. 14-2150 & 14-2287 

regulate nonmember conduct on non-Indian fee land, as opposed to tribal trust land. 

The Tribal Entities’ view cannot be squared with the Supreme Court’s more recent cases, Nevada v. Hicks, 533 U.S. 

353 (2001), and Plains Commerce Bank v. Long Family Land & 

Cattle Co., 554 U.S. 316 (2008). In Hicks, the Supreme Court 

considered whether a tribal court had jurisdiction over a 

warden’s allegedly tortious conduct while executing a search 

warrant on tribe-owned land within the reservation. The 

Supreme Court began its analysis with the general proposition that “Indian tribes’ regulatory authority over nonmembers is governed by the principles set forth in Montana.” 

Hicks, 533 U.S. at 358. It noted first, that, although “the nonIndian status of the land was central to the analysis 

in...Montana,” that was not because “Indian ownership suspends the ‘general proposition’...that ‘the inherent sovereign powers of an Indian tribe do not extend to the activities 

of nonmembers of the tribe.’” Id. at 359. “The ownership status of land,” the Court explained, “is only one factor to consider in determining whether regulation of the activities of 

nonmembers is ‘necessary to protect tribal self-government 

or to control internal relations.’” Id. at 360 (emphasis added). 

“[T]he existence of tribal ownership,” however, “is not alone 

enough to support regulatory jurisdiction over nonmembers.” Id. 

Moreover, more recently in Plains Commerce Bank, the 

Supreme Court reiterated that Montana’s “general rule restricts tribal authority over nonmember activities taking 

place on the reservation, and is particularly strong when the 

nonmember’s activity occurs on land owned in fee simple by 

non-Indians—what we have called ‘non-Indian fee land.’” 
Nos. 14-2150 & 14-2287 43

554 U.S. at 328 (quoting Strate v. A-1 Contractors, 520 U.S. 

438, 446 (1997)). Plains Commerce Bank, therefore, leaves no 

doubt that Montana applies regardless of whether the actions 

take place on fee or non-fee land.60 We therefore turn to the 

Montana exceptions. 

2. 

Looking to the first Montana exception, the Tribal Entities 

assert that the Financial Entities entered into a consensual 

relationship with the Tribe and engaged in on-reservation 

conduct that brings it within the jurisdiction of the tribal 

court. We made clear in Jackson, however, that Plains Commerce Bank “circumscribed” the already narrow Montana exceptions. Jackson, 764 F.3d at 782. We explained that a tribe’s 

authority to regulate nonmember conduct “centers on the 

land”: “‘Montana and its progeny permit tribal regulation of 

nonmember conduct inside the reservation that implicates the 

tribe’s sovereign interests.’” Id. (quoting Plains Commerce 

Bank, 554 U.S. at 327). 

 

60 The Tribal Entities point to the Ninth Circuit’s decision in Water Wheel 

Camp Recreational Area v. LaRance, 642 F.3d 802 (9th Cir. 2011). In that 

case, the Ninth Circuit stated that “Montana limited the tribe’s ability to 

exercise its power to exclude only as applied to regulation of nonIndians on non-Indian land, not on tribal land.” Id. at 810. The court in 

Water Wheel acknowledged the Court’s decisions in Nevada v. Hicks, 533 

U.S. 353 (2001), and Plains Commerce Bank v. Long Family Land & Cattle 

Co., 554 U.S. 316 (2008), but determined that Hicks’s holding was of “limited applicability,” Water Wheel Camp Recreational Area, 642 F.3d at 813, 

and that Plains Commerce Bank does not speak to situations involving Indian land, id. at 811 n.6. We do not believe that these conclusions can be 

reconciled with the language that the Court employed in Hicks and Plains 

Commerce Bank. 
44 Nos. 14-2150 & 14-2287 

The Tribal Entities submit that, in evaluating whether the 

tribal court has jurisdiction over the Financial Entities under 

the first Montana exception, the court need not limit its consideration to the on-reservation actions of the Financial Entities. This view, however, is at odds with Plains Commerce 

Bank, in which the Court observed “that the sovereignty that 

the Indian tribes retain is of a unique and limited character. 

It centers on the land held by the tribe and on the tribal members 

within the reservation.” 554 U.S. at 327 (emphasis added) (citations omitted) (internal quotation marks omitted). The actions of nonmembers outside of the reservation do not implicate the Tribe’s sovereignty. 

Turning to on-reservation conduct, the Tribal Entities 

point to “multiple meetings,” during which Stifel allegedly 

“misrepresented material terms of the Bond Transaction.”61

The first Montana exception, however, requires that a tribe’s 

regulation of the nonmember, here the tribal court action, 

“have a nexus to the consensual relationship itself.” Atkinson 

Trading Co., 532 U.S. at 656. The tribal court action, however, 

does not seek to regulate any of Stifel’s activities on the reservation. Rather, the tribal court action seeks to void each of 

the bond documents because they are unapproved management contracts under the IGRA; it also seeks to void the 

Tribal Agreement and Tribal Resolution “because [they] 

w[ere] not approved by a referendum vote of the members 

of the Tribe or the Secretary of the Interior as required by the 

 

61 Appellants’ Br. 34. Saybrook’s conduct has an even more tenuous connection to the reservation. Saybrook’s representative came onto the reservation only once for less than one day to gather information about the 

Casino. 
Nos. 14-2150 & 14-2287 45

Tribal Constitution.”62 Because the tribal court action does 

not seek redress for any of Stifel’s consensual activities on 

tribal land, it does not fall within Montana’s first exception. 

 

3. 

Finally, the Tribal Entities argue that the tribal court has 

jurisdiction over the Financial Entities under the second 

Montana exception. According to the Tribal Entities, the 

bond transaction imperiled the Tribe’s ability to provide services to its members. The Financial Entities’ actions, therefore, “threaten[] or ha[ve] some direct effect on the political 

integrity, the economic security, or the health or welfare of 

the tribe” and provide a basis for tribal court jurisdiction. 

Montana, 450 U.S. at 566. 

The Supreme Court discussed the second Montana exception in Strate, 520 U.S. at 458. The jurisdictional dispute in 

Strate arose from a vehicle collision between two individuals, Fredericks and Stockert, on a portion of a North Dakota 

state highway that ran through a reservation. Fredericks was 

not a member of the tribe, but was the widow of a deceased 

tribal member and had adult children who were tribal members. Stockert, also a nonmember, was driving a truck belonging to his employer, A-1 Contractors, a non-Indianowned enterprise, which was under contract to perform 

landscaping within the reservation. Fredericks filed a personal injury action against Stockert and A-1, and Fredericks’s children filed a loss-of-consortium claim in the same 

lawsuit. The tribal court ruled that it had jurisdiction, and 

 

62 R.1-14 (Tribal Court Statement of Claim) at 34.
46 Nos. 14-2150 & 14-2287 

Stockert and A-1 proceeded to federal court, where they 

sought a declaratory judgment that the tribal court lacked 

jurisdiction and also sought an injunction against further 

tribal court proceedings. 

Before the Supreme Court, Fredericks asserted that the 

tribal court had jurisdiction pursuant to Montana’s second 

exception. The Supreme Court disagreed and explained: 

Undoubtedly, those who drive carelessly on a 

public highway running through a reservation 

endanger all in the vicinity, and surely jeopardize the safety of tribal members. But if Montana’s second exception requires no more, the exception would severely shrink the rule. Again, cases 

cited in Montana indicate the character of the 

tribal interest the Court envisioned. 

... 

Read in isolation, the Montana rule’s second 

exception can be misperceived. Key to its proper 

application, however, is the Court’s preface: “Indian tribes retain their inherent power [to punish 

tribal offenders,] to determine tribal membership, to 

regulate domestic relations among members, and to 

prescribe rules of inheritance for members... . But 

[a tribe’s inherent power does not reach] beyond 

what is necessary to protect tribal self-government 

or to control internal relations.” Neither regulatory nor adjudicatory authority over the state 

highway accident at issue is needed to preserve “the right of reservation Indians to make 

their own laws and be ruled by them.” The 
Nos. 14-2150 & 14-2287 47

Montana rule, therefore, and not its exceptions, 

applies to this case. 

Id. at 457–59 (citations omitted) (emphasis added); see also

Plains Commerce Bank, 554 U.S. at 335 (observing that the 

regulations that it had approved of under Montana “all flow 

directly from these limited sovereign interests,” namely 

“tribal governance and internal relations”). 

Here, the Tribal Entities do not point to any actions by 

the Financial Entities that threatened the right of tribal 

members “to make their own laws and be ruled by them.” 

Strate, 520 U.S. at 459 (internal quotation marks omitted). Instead, they focus on the financial consequences of adhering 

to freely negotiated commercial transactions. The Tribal Entities essentially maintain that the second Montana exception 

applies whenever the economic effects of its commercial 

agreements affect a tribe’s ability to provide services to its 

members. Like the arguments made by Fredericks in Strate, 

however, if the second exception were so broad, it would 

swallow the general rule. The only questions raised in the 

tribal court action are the enforceability of commercial 

agreements; it does not address any on-reservation actions 

by the Financial Entities, much less actions that threaten 

tribal self-rule. 

In sum, the district court did not err in concluding that 

the Tribal Entities waived their sovereign immunity, that 

tribal exhaustion was not required, and that the Financial 

Entities had established a likelihood of success on the merits 

of their claim that the tribal court lacked jurisdiction over 

them. The district court, therefore, did not abuse its discretion in granting the Financial Entities a preliminary injunction as to the tribal court proceedings. 
48 Nos. 14-2150 & 14-2287 

III 

We turn now to Godfrey’s cross appeal. Before the district court, Godfrey conceded, for purposes of the court’s 

consideration of the preliminary injunction only, that it 

could not fit within either of Montana’s exceptions. It argued 

nevertheless that the tribal court lacked jurisdiction over it 

based on the waiver provisions in the Bond Documents. Because Godfrey did not contend that “federal law ha[d] divested the tribal court of jurisdiction” over it,63 the district court 

was not convinced that the general rule articulated in National Farmers Union Insurance Cos. v. Crow Tribe of Indians, 

471 U.S. 845, 852 (1985)—that “[t]he question whether an Indian tribe retains the power to compel a non-Indian property 

owner to submit to the civil jurisdiction of a tribal court is 

one that must be answered by reference to federal law and is 

a ‘federal question’ under § 1331”—applied to Godfrey’s 

claim. 

Assuming that it lacked jurisdiction over Godfrey’s 

claim, the district court turned to the question of supplemental jurisdiction under 28 U.S.C. § 1367(a). The district 

court observed that it was likely to dispose of the Financial 

Entities’ federal claims before a complete trial on the merits. 

Consequently, the district court believed that “a presumption ar[ose] in favor of relinquishing jurisdiction” over Godfrey’s supplemental claims.64 

Finally, the court noted that, even if it “ignore[d] its jurisdictional concerns,” Godfrey had not “yet established a 

 

63 R.175 at 34. 

64 Id. at 38. 
Nos. 14-2150 & 14-2287 49

substantial likelihood of success on the merits.”65 The court 

believed that, “Godfrey’s case falter[ed] in too many ways 

for the court to conclude” that it had met this burden.66 “In 

any event,” the district court continued, “it ma[de] little 

sense to exercise supplemental jurisdiction over Godfrey’s 

claims given that there is a reasonable likelihood that this 

court will not ultimately reach the merits of its claims.”67 

A. 

“We review questions of subject-matter jurisdiction de 

novo,” see Johnson v. Cypress Hill, 641 F.3d 867, 873 (7th Cir. 

2011), and we begin our jurisdictional analysis with the Supreme Court’s decision in National Farmers Union Insurance 

Cos., 471 U.S. 845. In that case, the Court considered the issue 

of whether a district court had jurisdiction to consider a tribal court’s exercise of jurisdiction over a non-Indian’s challenge to the tribal court’s exercise of jurisdiction. Specifically, 

a tribal court had entered a default judgment against a state 

school district after it failed to respond to a complaint 

brought by a Crow Indian who had been struck by a motorcycle on school property. The school district and its insurer 

subsequently sought an injunction in federal district court 

against the tribal court proceedings, and the federal district 

court granted the injunction. Without reaching the merits of 

the underlying claim, the Ninth Circuit Court of Appeals reversed on the ground that “the District Court’s exercise of 

 

65 Id. at 39. 

66 Id. at 48. 

67 Id. 
50 Nos. 14-2150 & 14-2287 

jurisdiction could not be supported on any constitutional, 

statutory, or common-law ground.” Id. at 849. 

The Supreme Court reached a different conclusion. It explained that, while at one time Indian tribes had “exercised 

virtually unlimited power over their own members as well 

as those who were permitted to join their communities,” 

now “the power of the Federal Government over the Indian 

tribes is plenary.” Id. at 851. Consequently, “[f]ederal law, 

implemented by statute, by treaty, by administrative regulations, and by judicial decisions, provides significant protection for the individual, territorial, and political rights of the 

Indian tribes.” Id. The Court, therefore, concluded that “[t]he 

question whether an Indian tribe retains the power to compel a 

non-Indian property owner to submit to the civil jurisdiction of a 

tribal court is one that must be answered by reference to federal law and is a ‘federal question’ under § 1331.” Id. at 852 

(emphasis added). Consequently, because the school district 

and its insurer “contend[ed] that federal law ha[d] divested 

the Tribe of this aspect of sovereignty, it is federal law on 

which they rel[ied] as a basis for the asserted right of freedom from Tribal Court interference. They have...filed an action ‘arising under’ federal law within the meaning of 

§ 1331.” Id. at 852–53. 

The district court believed that “Godfrey’s claims do not 

fall neatly within th[is] language,” because Godfrey contends that state contract law, not federal law, “foreclosed 

[the Tribal Entities] from invoking tribal court jurisdiction.”68 We have been unable to locate, however, any authorities that support the distinction drawn by the district court. 

 

68 Id. at 34. 
Nos. 14-2150 & 14-2287 51

It is well recognized that “[f]ederal question jurisdiction...extends to...claims that the exercise of tribal authority 

impermissibly exceeds the federal common-law limits imposed by the Supreme Court.” Cohen’s Handbook of Federal 

Indian Law § 7.04(1)(a), p.613 & n.11 (Nell Jessup Newton ed., 

2012) (citing National Farmers Union Ins. Cos., 471 U.S. at 852–

53). Indeed, in every case cited by the parties, the court determined that the scope of tribal court authority, even where 

allegedly circumscribed by contract, raised a federal question 

under § 1331. See Gaming World Int’l, Ltd. v. White Earth Band 

of Chippewa Indians, 317 F.3d 840, 848 (8th Cir. 2003) (“[A]n 

action filed in order to avoid tribal court jurisdiction necessarily 

asserts federal law. It is well established that the scope of tribal 

court jurisdiction is a matter of federal law.”(emphasis added) (citation omitted)); Ninigret Dev. Corp. v. Narraganset Indian Wetuomuck Hous. Auth., 207 F.3d 21, 28 (1st Cir. 2000) 

(holding, in the context of dispute in which tribe’s adjudicative authority allegedly was limited by contract, that “‘federal courts have authority to determine, as a matter “arising 

under” federal law,’ the limits of a tribal court’s jurisdiction” 

and “[t]he fact that a plaintiff’s claims are not premised on 

federal law does not alter this result” (quoting El Paso Natural Gas Co. v. Neztsosie, 526 U.S. 473, 483 (1999))); Bruce H. 

Lien Co. v. Three Affiliated Tribes, 93 F.3d 1412, 1421–22 (8th 

Cir. 1996) (noting that among the “aspects of the dispute” 

that raised a federal question was the fact that “this case is 

being directed to the Tribal Court and exhaustion within 

that system” and further observing that “[t]he existence of 

tribal court jurisdiction itself presents a federal question 

within the scope of 28 U.S.C. § 1331”); cf. Arizona Publ. Serv. 

Co. v. Aspaas, 77 F.3d 1128, 1132 (9th Cir. 1996) (holding that, 

in context of a challenge to a tribe’s legislative authority over 
52 Nos. 14-2150 & 14-2287 

a non-Indian that was allegedly limited by contract, “a nonIndian challenging an exercise of tribal adjudicatory or legislative power states a claim that arises under federal law”).69

Following the lead of our sister circuits, therefore, we 

agree with Godfrey that the district court had subject matter 

jurisdiction to consider Godfrey’s challenge to tribal court 

jurisdiction, even though that challenge is rooted in the language of the Bond Documents. The district court therefore 

had subject matter jurisdiction over Godfrey’s claim that the 

tribal court did not have jurisdiction to consider the merits 

of the claim against it.70

 

69 In the present action, the district court discounted Bruce H. Lien v. 

Three Affiliated Tribes, 93 F.3d 1412 (8th Cir. 1996), and Gaming World International, Ltd. v. White Earth Band of Chippewa Indians, 317 F.3d 840 (8th 

Cir. 2003), because, “to the extent that the [Federal Arbitration Act]’s policy in favor of arbitration supported divestment of tribal jurisdiction, the 

defendants in both cases ‘relied’ on federal law ‘as a basis for the asserted right of freedom from Tribal Court interference.’” R.175 at 36 (quoting 

Nat’l Farmers Union Ins. Cos., 471 U.S. at 853). Two considerations, however, prevent us from embracing this distinction. First, neither Bruce H. 

Lien nor Gaming World International rests its analysis on the federal policy 

in favor of arbitration embodied in the Federal Arbitration Act. Second, 

the Federal Arbitration Act does not create federal jurisdiction: “As for 

jurisdiction over controversies touching arbitration, the [Federal Arbitration] Act does nothing, being something of an anomaly in the field of 

federal-court jurisdiction in bestowing no federal jurisdiction but rather 

requiring an independent jurisdictional basis.” Hall Street Assocs., L.L.C. 

v. Mattel, Inc., 552 U.S. 576, 581–82 (2008) (internal quotation marks omitted). 

70 Because the district court reached a contrary conclusion, it proceeded 

to consider whether it should exercise supplemental jurisdiction over 

Godfrey’s claims under 28 U.S.C. § 1367(a). As noted previously, it was 

reluctant to do so given that the Financial Entities’ claims likely would be 

resolved prior to trial. We need not address that conclusion.
Nos. 14-2150 & 14-2287 53

B. 

Although the district court did not identify a single, defining rule of law that precluded Godfrey from prevailing on 

the merits, it had an overall unease about granting preliminary injunctive relief: “Godfrey’s case falters in too many 

ways for the court to conclude [that] it has demonstrated the 

requisite likelihood of success.”71 Yet, our own study of the 

district court’s explanation of Godfrey’s claims reveals as 

well a disquietude with the Tribal Entities’ arguments.

72 Now 

that we have rejected, definitively, the Tribal Entities’ general contentions with respect to the tribal court’s exercise of 

jurisdiction over all of the parties, including Godfrey, we 

turn to the one argument, unique to Godfrey, which we have 

not addressed: that Godfrey cannot invoke the forum selection clauses in the Bond Documents because it is not a party 

to the bond transaction.73

 

71 R.175 at 48. 

72 See id. at 41 (identifying “a number of flaws in [the Tribal Entities’] 

argument”); id. at 44 (noting that it “would be disinclined” to accept a 

position of the Tribal Entities); and id. at 46 (observing that the Tribal 

Entities’ arguments for “void[ing] the Specimen Bond are somewhat less 

persuasive”). 

73 Specifically, the Tribal Entities assert that “Godfrey’s repeated reliance 

on [the forum selection] clauses is misplaced because it lacks standing to 

enforce them. Godfrey did not bargain for forum-selection rights in the 

Bond Documents or in the general-counsel contract that governed its relationship with the Tribal [Entities]. SA-1061-62.” Appellants’ Reply Br. 

53. The Tribal Entities do not make any further argument or provide any 

additional explanation as to the effect or limitations of the generalcounsel agreement on the Bond Documents. “We repeatedly have made 

clear that perfunctory and undeveloped arguments...are waived... .” 

United States v. Berkowitz, 927 F.2d 1376, 1384 (7th Cir. 1991). Moreover, 
54 Nos. 14-2150 & 14-2287 

In Adams v. Raintree Vacation Exchange, LLC, 702 F.3d 436 

(7th Cir. 2012), we reiterated that the test for whether a nonparty to a contract can enforce—and be bound by—a forum 

selection clause “is whether the nonparty is ‘closely related’ 

to the suit.” Id. at 439. Acknowledging that this is a “vague 

standard,” we noted that “it can be decomposed into two 

reasonably precise principles”: “‘affiliation’ and ‘mutuality,’” either of which is sufficient to allow a nonparty to invoke a forum selection clause. Id. 

The Tribal Entities do not maintain either that Godfrey 

lacks a close affiliation with them, the bond transaction, or 

the Bond Documents. Instead, they contend that “affiliation,” as we employed that term in Adams, really means a 

“parent or subsidiary” relationship to the party of a contract, 

and Godfrey is not related either to the Tribal Entities or to 

the Financial Entities in this way.74 The Tribal Entities, however, do not point to any case in which we have limited “affiliation” to entities that are only related through corporate 

structure. 

 

the tribal court action does not seek to hold Godfrey liable for its advice 

or actions as general counsel, but only its actions as bond counsel. See

R.1-14 at 10 (“Godfrey would retain $125,000 of Bond proceeds as its fee 

for serving as Bond Counsel”); id. at 14 (“Stifel and Godfrey Press the 

Tribe to Approve the Bond Transaction”); id. at 23 (“Godfrey incorrectly 

opined that the Bond Documents did not require NIGC approval.”); id. at 

29–34 (requesting relief in the form of a declaration that the Bond Documents and the bond transaction are void under Tribal law and under the 

IGRA). As explained above, the forum selection clauses in the Bond 

Documents are written in the broadest terms so as to encompass any dispute or controversy arising out of the bond transaction, including claims 

against Godfrey as bond counsel. See supra 34.

74 Appellants’ Reply Br. 54. 
Nos. 14-2150 & 14-2287 55

Similarly, with respect to “mutuality,” the Tribal Entities 

do not quarrel with the proposition that Godfrey would 

have been held to the forum selection clause had it been 

sued by another party. Instead, the Tribal Entities maintain 

that “mutuality” is limited to the idea that “secret principal[s]” and “co-conspirator[s]” may “enforce a forumselection clause of its partner or puppet.”75 Again, there is 

nothing in our case law that suggests that “mutuality” is 

limited to these situations. Rather, these situations simply 

represent the factual scenarios in which we have been called 

upon to apply the general principal of mutuality. See Adams, 

702 F.3d at 442–43; Frietsch v. Refco, Inc., 56 F.3d 825, 827 (7th 

Cir. 1995). 

Here, where it is clear that Godfrey was intimately involved in the negotiations leading to, and the documents 

embodying, the bond transaction, and where the Tribal Entities do not take exception to the conclusion that Godfrey 

would be bound by the forum selection clauses in the Bond 

Documents, we believe that the concepts of affiliation and 

mutuality are met. 

Moreover, we believe that this is a particularly appropriate case to allow a nonparty to invoke a forum selection 

clause. Godfrey was not simply counsel to the Tribal Entities, it was bond counsel to the transaction. As one commentator has observed, “[a]lthough bond counsel is usually retained by the issuer, bond opinions must be completely objective, since they will not serve the function of facilitating 

the sale of bonds unless they are accepted as reliable in the 

bond market.” 2 James A. Coniglio & M. David Gelfland, 

 

75 Id. (internal quotation marks omitted).
56 Nos. 14-2150 & 14-2287 

State & Federal Government Debt Financing § 16.16 (2d ed. 

2015). Indeed, some courts have recognized that “an attorney who issues an opinion letter for the purpose of inducing 

a non-client to purchase municipal notes or bonds can be liable for negligent misrepresentation when the opinion letter 

contains material misstatements of fact.” Mohaffy, Rider, 

Windholz & Wilson v. Central Bank of Denver, 892 P.2d 230, 233 

(Col. 1995);76 cf. Restatement (Third) of the Law Governing 

Lawyers § 51(2)(a) (2000) (stating that a lawyer owes a duty 

of care to a nonclient when the lawyer or his client “invites 

the nonclient to rely on the lawyer’s opinion...and the nonclient so relies”). 

Additionally, as the district court explained: 

[W]hile [the Tribal Entities] have sued Godfrey 

in [tribal] court, they assert no claims against 

Godfrey. Rather, Godfrey is a defendant in that 

suit for the sole purpose of binding them to 

any determination regarding the validity of the 

Bond Documents, even though defendants 

contend in this court that Godfrey is a 

“stranger” to those documents. Essentially, de-

 

76 The general rule in Wisconsin is that “an attorney c[an] not be held 

liable to third parties for any acts committed within the scope of an attorney-client agency relationship.” Green Spring Farms v. Kersten, 401 

N.W.2d 816, 823 (Wis. 1987). However, the Wisconsin courts have deviated from the general rule, and the following factors have guided that 

determination: “(1) the extent to which the transaction was intended to 

affect the plaintiff; (2) the foreseeability of harm to the plaintiff; (3) the 

degree of certainty that the plaintiff suffered harm; (4) the nexus between 

the defendant’s conduct and the plaintiff’s harm; and (5) the policy of 

preventing future harm.” Id. 
Nos. 14-2150 & 14-2287 57

fendants have obliged Godfrey to defend the 

Bond Documents’ validity in tribal court while 

maintaining in this court that those documents 

give Godfrey no enforceable rights. Those positions are inconsistent, and the court would be 

disinclined to foreclose Godfrey from the benefit of the documents’ forum selection clause 

given the nature of the tribal court action.[77]

We do not perceive any jurisdictional or legal impediments to Godfrey’s relying on the forum selection clauses in 

the Bond Documents.78 We therefore reverse the judgment of 

the district court denying Godfrey a preliminary injunction. 

Because the district court determined that Godfrey was 

not likely to succeed on the merits of its claim, the district 

court did not reach the other elements of the preliminary injunction analysis, namely whether Godfrey had an adequate 

remedy at law, whether Godfrey would suffer irreparable 

harm, whether the balance of harms weighed in favor of an 

injunction, and whether issuing a preliminary injunction 

was in the public interest. See, e.g., Ferrell v. U.S. Dep’t of 

Hous. & Urban Dev., 186 F.3d 805, 811 (7th Cir. 1999). We 

therefore remand this action to the district court so that it 

may complete this analysis and determine whether a preliminary injunction should issue in favor of Godfrey. 

 

77 R.175 at 44 (internal citation omitted).

78 We do note that this aspect of the case would have been much simpler 

had there been a specific forum selection clause in the Bond Documents 

governing disputes involving bond counsel.
58 Nos. 14-2150 & 14-2287 

Conclusion 

We conclude that there were no impediments to the district court’s consideration of the Financial Entities’ and Godfrey’s challenges to tribal court jurisdiction. Our decision in 

Altheimer & Gray forecloses the Tribal Entities’ argument that 

exhaustion of tribal court remedies was required. Similarly, 

we conclude that the Bond Documents contain valid and effective waivers of the Tribal Entities’ sovereign immunity. 

With respect to the merits of the Financial Entities’ motion for a preliminary injunction, the district court correctly 

concluded that the Financial Entities were likely to succeed 

on the merits of their claim that the tribal court lacked jurisdiction over them. We therefore affirm the judgment of the 

district court with respect to the grant of preliminary injunctive relief to the Financial Entities. 

We reverse, however, the district court’s denial of preliminary injunctive relief to Godfrey. The district court erred in 

concluding that it lacked subject matter jurisdiction over 

Godfrey, and that error colored its view of Godfrey’s likelihood of success on the merits. Godfrey, like the Financial Entities, may invoke the forum selection clauses in the Bond 

Documents and, consequently, is likely to succeed on its 

claim that the tribal court lacks jurisdiction over it in this 

bond-related action. We therefore remand to the district 

court for further proceedings to determine whether, given 

the other preliminary-injunction factors, an injunction 

should issue in favor of Godfrey. 

AFFIRMED IN PART; 

REVERSED AND REMANDED IN PART