____________ Nos. 95-2529 95-2535 95-2720

____________ United States of America, on * behalf of the Cheyenne River * Sioux Tribe and its members, * * Plaintiff/Appellant/Cross * Appellee, * * Cheyenne River Sioux Tribe, * * Intervenor Plaintiff/ * Appellant/Cross Appellee, * * v. * * State of South Dakota; Julie * M. Johnson, State Secretary of * Revenue, * * Defendants/Appellees/Cross * Appellants, * Appeals from the United States * District Court for the Ronald J. Schreiner; Dewey * District of South Dakota County, South Dakota; * John Alley, County Treasurer; * Ziebach County, South Dakota; * Virginia Hertel, County * Treasurer, * * Defendants/Appellees. * *

____________ * * No. 95-2688 *

____________ * * Rosebud Sioux Tribe, * * Plaintiff/Appellant, *

### The HONORABLE BRUCE M. VAN SICKLE, United States District * 

### Judge for the District of North Dakota, sitting by designation. The statute provides: 1 

### In addition to all other license and registration fees for the use of the highways, a person shall pay an excise tax at the rate of three percent on the purchase price of any motor vehicle . . . purchased or acquired for use on the streets and highways of this state and required to be registered under the
2 v. * * Julie Johnson, State Secretary * of Revenue, * * Defendant/Appellee. *

____________ * * United States of America, * * Amicus Curiae. *

____________ Submitted: May 16, 1996 Filed: January 17, 1997

____________ Before MURPHY and ROSS, Circuit Judges, and VAN SICKLE, District Judge. *

____________ MURPHY, Circuit Judge.

Th ese two cases challenge the jurisdiction of the State of Sout h Dakota to impose its motor vehicle excise tax and registration fee o n Indians who live within the boundaries of a rese rvation. In one case, the United States sued for declarative, injunctive, and compensatory relief on behalf of the Cheyenne River Sioux Tribe and its members. The second case involves claims brought by the Rosebud Sioux Tribe for equitable relief.

So uth Dakota Codified Laws section 32-5B-1 provides that resident s shall pa y an excise tax on the value of any motor vehicle purchased o r acquired for use in the state and required to be registered. S.D. Codifie d Laws Ann. § 32-5B-1. The excise tax is 1

### laws of this state. This tax shall be in lieu of any tax levied

by chapters 10-45 and 10-46 on the sales of such vehicles. Failure to pay the full amount of excise tax is a Class 1 misdemeanor. S.D. Codified Laws Ann. § 32-5B-1. The issuance or transfer of a certificate of title also 2 

### requires payment of a $5 fee, which is not challenged by the parties in this case. The statute provides: 3 

### Subject to the provisions of §§ 32-5-17 to 32-5-45, inclusive, license fees and compensation for use of the highways, fees shall be based, except as otherwise specifically provided, upon manufacturers' weights, including accessories. If a noncommercial motor vehicle is an automobile, pickup truck or van with a manufacturer's shipping weight, including accessories, of six thousand pounds or less, the license fees for such a motor vehicle shall be as provided by § 32-5-6. . . . These fees shall be paid annually to the county treasurer, and shall be as provided by this chapter. S.D. Codified Laws Ann. § 32-5-5.
3 a one time assessment collected by the county in which the owner resides when the vehicle is first licensed in the state. Id. § 32-5B-10. Payment of the excise tax is required for the issuance or transfer of state vehicl e title, id. § 32-5B-14, and is thus a condition precedent to registration and issuan ce of state license plates. The proceeds are allocated to the 2 state highway fund. Id. § 32-5B-17. Failure to pay the excise tax is a misdemeanor. § 35-5B-1.

South Dakota Codified Laws section 32-5-5 imposes a separate moto r vehicle registration fee on state residents. S.D. Codified Laws Ann. § 32

- 5-5. The annual fee is based on the weight of the vehicle andranges from 3 $20 to $40 for average noncommercial

### Motor vehicles owned by the tribe itself are statutorily 4 

### exempt from the state excise tax and registration fee, and license plates are issued for a fee based on actual administrative costs. S.D. Codified Laws Ann. § 32-5-42 (registration fee); id. § 32-5B-2(1) (excise tax).
4 vehicles. It is collected at the time the owner obtains license plates or renewal tags, and is a condition precedent for their issuance. Id. A percentage of the collected fees goes toward adm inistrative costs, and the remainde r is allocated to various road funds. Failure to pay th e registration fee is a misdemeanor. § 32-5-2.4.

I.

The Cheyenne River Sioux Tribe is a federally recognized India n tribe. In 1868 the Fort Laramie Treaty, 15 Stat. 635, established th e Great Sioux Reservation for the use and occupancy of the Sioux Nation

. Con gress later created the Cheyenne River Indian Reservation in 1889 o n part of the treaty land as a separate reservation for the Cheyenne River Sioux Tribe. See Sou th Dakota v. Bourland , 508 U.S. 679 (1993). In 1908 Congre ss opened a significant portion of the reservation to non-India n sett lement, but this did not diminish the reservation. See Solem v

. Bartlett , 465 U.S. 463 (1984). The reservation wholly encompasses Dewey and Ziebach counties in the State of South Dakota. Its residents include tribal members, nonmember Indians, and non-Indians.

The trib e believes that all Indians residing on the Cheyenne Rive r Indian Reservation are immune from state taxatio n of their motor vehicles, including both the excise tax and the annual reg istration fee. The tribal counci l has consistently maintained that the state lacks authority t o collect the excise tax and registration fee from tribal members, and there 4 is evidence in the re cord that at least some members have paid the excise tax and registration fee under protest.

### The suit named as defendants the State of South Dakota and 5 

### its Secretary of Revenue, as well as two counties and the county treasurers. The Honorable John B. Jones, United States District Judge 6 

### for the District of South Dakota.
5 The statutes do not create an exemption for Indian-owned vehicle s that are driven exclu sively on reservation land, but the state apparently does not enforce its motor vehicle registration laws in such circumstances

. The owner of any vehicle driven outside the reservation is subject t o criminal penalties for improper registration, however. At one time, triba l law incorporated state traffic laws and requiredall motor vehicles driven on the reservation to have valid state license plates. In 1994 the tribe enacted its own motor vehicle registration system, but has not ye t implemented it to avoid imposing double fees on reservation residents.
On September 3, 1992 the United Stat es brought suit on behalf of the Cheyenne River Sioux Tribe and its members, seek ing a declaration that the state lacks jurisdiction to impose its motor vehicle excise tax an d registra tion fee on Indians residing on the Cheyenne River reservation. 5 It also sought an injunction against the collect ion of the fees and taxes, and monetary damages in the amount of taxes paid between 1986 and th e present. On August 24, 1993, the Cheyenne River Sioux Tribe was permitted to intervene as a plaintiff pursuant to Federal Rule of Civil Procedur e 24(b).

In February 1995 the district court ruled on cross motions fo r 6 summary judgment. It held that the excise tax was essentially a personal property tax and thus could not be imposed on tr ibal members living on the reservation. See Oklahoma Tax Comm'n v. Sac andFox Nation , 508 U.S. 114, 127-28 (1993). It viewed the annual registration fee differently , conc luding that it was a nondiscriminatory fee that could validly b e collected from tribal

### 6

members residing on t he reservation who elected to purchase state license plates. The district court did not extend immun ity from the excise tax to nonmember Indians and did not award damages to tribal members. Judgment was entered on February 23, 1995, and the parties filed cross appeals.

The Unite d States and the tribe argue that the registration fe e operates as a tax and thus cannot be imposed on reservation Indians. They als o claim that monetary damages should be awarded for taxes previousl y paid. The tribe also argues that tax immunity should be extended t o nonmember Indians residing on the Cheyenne River reservation. South Dakot a responds that the district court correctly deter mined the registration fee to be valid, denied monetary damages, and held t hat nonmember Indians were not immune from taxation. It argues on cross appeal that the excise tax is a valid sales and use tax.

A.

As a general rule, a state lacks jurisdiction to tax the lands , activities, and prope rty of tribal members "'within the boundaries of the reservation,'" unless there has been a "'cession of jurisdiction or other federal statutes permitting it.'" California v. Cabazon Band of Mission Indians , 480 U.S. 202, 215 n. 17 (1987) (quoting Mescalero Apache Tribe v. Jones , 411 U.S. 145, 148 (1973)). In other words, a tribal member's onre servation activities are immune from state taxation absent expres s congressional authorization of the tax. McClana han v. State Tax Comm'n of Arizona , 411 U.S. 164, 171 (1973). This is beca use a state's authority to tax on- reservation activities is limited or preempted by the terms o f treatie s which set aside reservations for the exclusive use of India n tribes and by various federal statutes

### The analysis in McClanahan relies on the language in a 7 

### treaty with the Navajo. South Dakota does not claim that the analysis should be different in this case or argue that it has jurisdiction to tax on-res ervation activities or property.
7 defining t he limits of state power. Id. The doctrine of India n 7 sovereignty reflects the "'deeply rooted'" historical policy of "'leaving Indians free from state jurisdiction and control.'" Id. at 168 (quoting Rice v . Olson , 324 U.S. 786, 789 (1945)). That doctrine "provides a backdrop against which the applicable treaties a nd statutes must be read." Id. at 172.

Congress has not specifically authorized the taxation of a triba l member 's personal property, and South Dakota thus lacks jurisdiction t o impose such a tax. This would include any tax or fee that operates as a personal property tax on motor vehicles owned by tribal members living on the reservation. Oklahoma Tax Comm'n v. Sac andFox Nation , 508 U.S. 114, 127-2 8 (1993); Washington v. Confederated Tribes of Colville India n Reserva tion , 447 U.S. 134, 163 (1980); Moe v. Confederated Salish an d Kootenai Tribes of Flathead Reservation , 425 U.S. 463, 480-81 (1976).
The general rule of tax immunity app lies to activities that occur on the r eservation, including ownership of property, but "differen t considerations" apply to off-reservation activities. Mescalero , 411 U.S. at 148. Indians who go beyond reservation boundaries are generally "held subject to nondiscriminatory state law otherwise applicable to al l citizens." Id. at 148-49. This reasoning suggests that states may impos e
on t ribal members a sales tax or other nondiscriminatory tax on off

reservation purchases. See Tunica-Biloxi Tribe v. Louisiana , 964 F.2d 153 6 (5th Cir. 1992).

The par ties do not disagree about the general rule of tax immunit y for tribal members within the boundaries of a re servation or the authority of the state to tax off-reservation sales

### The dissent attempts to make too much of the mention of the 8 

### fact that the South Dakota excise tax is not collected by the retailer at the time of sale. This is but one of the facts that make up the total circumstances showing that the excise tax is a tax on personal property rather than a sales tax. The tax only applies to certain types of vehicles sales in South Dakota. It also applies to vehicles purchased by South Dakota residents outside of the state and to certain vehicles not recently purchased, but recently brought into the state. Furthermore, it arises on application for title, rather than on vehicle sale. Under the teaching of Supreme Court precedent it is the nature and characteristics of the particular tax that determines whether the tax is permissible, not the nature of the label applied to it. Sac and Fox , 508 U.S. at 127-28; Colville , 447 U.S. at 163. This requires examination of all the attributes of the particular tax. The dissent ignores this principle and selects only certain factors to analyze. The dissent also has done its own survey of taxes in other states in the circuit and concludes that they show some similarities to the South Dakota excise tax. There is no information about whether any of these states have attempted to apply the taxes to on-reservation Indians, and if so, what the result has been. This discussion of other state taxes is not based on the record before the court, and the parties have had no occasion to address the possible relevance or irrelevance of the dissent’s speculation about other state laws and its invitation
8 transactions. South Dakota admits that it would lack authority to impose state property taxes on members of the Cheyenne River Sioux Tribe living on the reservation, a nd the tribe concedes that its members could validly be required to pay a sales tax on off-reservation purchases, a properl y limi ted state road use tax, or certain non-discriminatory fees. Th e dispute here is one of classification: what sor t of tax or fee is created by these statutes?

South Dakota argues that the excise tax is a sales tax on off

reservation purchases of motor vehicles. The statute itself speaks o f levying an excise tax , "in lieu of" any sales or use tax, on the value of any motor vehicle "purchased or acquired for use" in the state. § 32-5B-1

. Unlike the state sale s tax, the excise tax is not imposed on the retailer or at the time of sale. Compare S.D. 8

### for additional litigation.

9

Codified Laws Ann. § 10-45-2 (retail sales tax) with § 32-5B-10 (excis e tax). Nor is the excise tax revenue credited to the general revenue fund. Compare S.D. CodifiedLaws Ann. § 10-46-48 with § 32-5B-17. Although the amount of the tax is based on the "purchase price," that term is defined to include either the actual consideration paid or the actual value of the vehicle. See S.D. Codified Laws Ann. §§ 32-5B-4(3)-(5), 32-5B-11.
The excise tax does not operate like a sales tax. It might resemble
a sales tax in some cases, such as when a new or used car is purchased fro m
a licensed dealer in South Dakota and registered there by the new owner. In other circumstances, however, the tax more obviously relates to th e ownership of the vehicle as property rather than the sales transactio n itself. For example, the tax does not apply to all motor vehicle sales in the state, but only to those resulting in ownership by a South Dakot a resident. The tax is not paid unless the owner applies for the issue or transfer of South Dakota title. § 32-5B-14. Conversely, the excise tax does apply to vehicles purchased out of state by South Dakota residents. Moreover, the tax applies to motor vehicles that are being newly brought into the state, but h ave not recently been purchased. A person moving to South D akota and applying for a state motor vehicle title is taxed at a percenta ge of the retail value of the vehicle on the day it enters th e state, unless the owner provides sufficient proof that the vehicle wa s subject to an equal or greater tax in another state. § 32-5B-11.

South Dakota asserts that Tunica-Bil oxi Tribe v. Louisiana , 964 F.2d 1536 (5 th Cir. 1992), supports its claim that the excise tax is a vali d sales tax, but the ta x at issue in that case was different from the South Dakota excise tax. Tunica involved a Louisiana tax on the "sale at retail " of any item of property

### Louisiana also imposed a separate "use tax" on the fair 9 

### market value of vehicles purchased out of state and later brought into it. That tax was not at issue in Tunica , but the court indicated that its validity might have presented a different question. 964 F.2d at 1540-41. It should also be noted that the Fifth Circuit did not 10 

### have the benefit of the most recent Supreme Court guidance in this area, because Tunica was decided before Sac and Fox

. 10 within the state. That tax did not apply to items purchased out of state. 9 Purchasers from outside Louisiana could also be subject to the sales tax
un like the South Dakota tax which is not applied to out-of-stat e purchasers. Since the characteristics of the So uth Dakota tax differ from the Louisiana tax, the outcome here is not inconsistent with Tunica . It is simply wrong to suggest that our decision wil l create a split among the circuits. 10

The South Dakota excise tax resembles the personal property taxe s found to be preempted in Moe , Colville , and Sac and Fox

. Colville involve d
a Washington "excise tax" which was assessed annually at a percentage of
a motor vehicle's value for the "privilege" of using a motor vehicle in th e state. 447 U.S. at 1 62. The Supreme Court held that the tax was similar in all but name to the personal property tax on motor vehicles that ha d been invalidated as a pplied to tribal members in Moe , 425 U.S. at 480-81. Colville , 447 U.S. at 163. Similarly, in Sac and Fox , the Supreme Court held that Oklahoma's motor vehicle excise tax and its yearly vehicl e registration fee operated as personal property t axes and thus could not be imposed on tribal mem bers living on the reservation. 508 U.S. at 127-28. The South Dakota tax is not identical to the taxes in Moe , Colville , and Sac and Fox , but it has important similarities. Like them, the Sout h Dako ta tax is applied to motor vehicle owners, rather than simply t o purchasers, and is based on a percentage of the value of the motor vehicle

. Sac and Fox , 508 U.S. at 119; Colville , 447 U.S. at 163 (discussing Moe )

. It is true that this tax is not applied annually,

### Contrary to the dissent's implication in its discussion of 11 

### Moe and Colville , Sac and Fox indicates that a state without authority to impose an annual tax has no more authority to impose a one-time tax.
11 but neither was the tax found invalid in Sac and Fox

. Sac and Fox , 508 11 U.S. at 126.

The So uth Dakota excise tax essentially operates as a tax on th e ownership of a motor vehicle, rather than as a tax on off-reservation sale s transactions. The ownership of a vehicle is the sort of on-reservatio n activity that a state is not permitted to tax without express Congressiona l authorization. See S ac and Fox , 508 U.S. at 127. The district court did not err in ruling that the state lacks jurisdiction to impose the excise tax on tribal members residing on the reservation.

B.

The Unite d States and the Cheyenne River Sioux Tribe argue that the state similarly lacks jurisdiction to impose its annual registration fee
on res ervation Indians because it operates to tax on-reservatio n activities. South Dakota responds that it has a uthority to impose the fee because it is a nondiscriminatory fee for off-re servation activities. The issue is again one of classification.

The United States and the tribe clai m that the fee actually operates as a tax on the ownership of vehicles and is the refore preempted under Sac and Fox , Colville , and Moe . In Sac and Fox the Court held Washington' s annual registration fee to be invalid as applied to reservation Indians, but that fee was based on the value of a vehicle and thus was like a perso nal property tax. Id. at 127-28. It was found to be no differen t fro mthe taxes held preempted in Moe and Colville . South Dakota' s registration fee does not resemble a property tax, however. It is no t based on the

### 12

value of the vehicle, but is a flat fee based on weight, and any proceeds resulting from it are dedicated to highway purposes.

The U nited States and the tribe also suggest that the fee is a ta x
on the use of state roads. They concede that a state might hav e jurisdict ion to impose a tax on reservation Indians for the use of off

reservation roads, but argue that the fee here is not "tailored to th e actual amount of off-reservation use" as require d by Colville , 447 U.S. at 163-64.

In Colville , the Supreme Court rejected the State of Washington' s clai mthat its excise tax was actually a tax on the use of the vehicl e within th e state. It held that the tax effectively functioned as a personal property tax, which had previously been held invalid as applied to tribal members in Moe :

We do not think Moe and McClanahan can be this easil y circumvented. While Was hington may well be free to levy a tax on the use outside the reservation of Indian-owned vehicles, it may not under that rubric accomplish what Moe held wa s prohibited. Had Washington tailored its tax to the amount of actual off-reservation u se, or otherwise varied something more than mere nomenclature, this might be a different case.

Id. There is no suggestion in the South Dakota statute that the purpose of the fee is to tax the use of the state roads. Even if it were, the tax is significantly different from a property tax so that the concern s expressed in Colville are avoided.
The registration fee is a nondiscrim inatory fee for the registration of a vehicle in the state and the issuance of state license plates. See Moe , 425 U.S. at 469 (Montana fee required for registration and issuance of state license plates could be imposed

### Montana's registration fee was not challenged by the tribe 12 

### in Moe , but the Court's analysis suggests a basis to differentiate between a registration fee that could be imposed on reservation Indians and a personal property tax that could not.
13 on r eservation Indians). It is not collected from owners of moto r 12 veh icles that are not registered with the state, including those drive n exclusively within the boundaries of the reservation. The concerns relate d to state taxation of on-reservation activities are not present here becaus e the f ee is not based on any on-reservation activity. Accordingly, th e district court did not err in ruling that Indians who elect to purchas e South Dakota license plates or renewal tags can be required to pay th e annual registration fee.

C.
The Cheye nne River Sioux Tribe argues that immunity from the excise tax should not be limited to tribal members but should extend to nonmember Indi ans residing on the reservation. South Dakota responds that th e interests of nonmember Indians have not been properly raised, and argues that nonmember Indians are subject to state taxa tion because they have the same status as non-Indians. The state's power to tax nonmember I ndians is not directly raised by this action, because no nonmember Indians are parties to this case. The United States initiat ed the action "on behalf of the Cheyenne River Sioux Tribe and its members," and the tribe intervened"to protect its sovereign right to raise revenue to finance its state government . . . ."
Even if the issue had been properly presented, the arguments ma de are not convincing. As discussed above, the tax immunity of reservatio n Indians is premised o n the preemption of state laws by treaty and statute and i nformed by notions of tribal self government. These reason s underlying immunity do not have the same

### The tribe argues that state taxation of nonmembers is 13 

### preempted by the comprehensive federal Indian country road system, but the statutes and regulations implementing that system do not demonstrate a Congressional intent to exempt nonmember Indians from state taxation. See Colville , 447 U.S. at 161.
14 force as applied to Indians who are not members of the governing tribe. 13 See Colvi lle , 447 U.S. at 160-61 (retail sales tax immunity for on

reserv ation sales does not extend to nonmember Indians residing o n reservation).
The tribe argues that the interest i n tribal self government extends to nonmember Indians because Congress has defined tribal self government to include all Indians. Although Congress has defined tribal powers o f self g overnment to include criminal jurisdiction over "all Indians," 2 5 U.S.C. § 1301, there is no question that South Dakota retains civi l regulatory jurisdiction over nonmember Indians in the same way that it doe s over non-Indians on the reservation. See id.
The tribe also asserts that the terms of the 1868 treaty creati ng the Great Sioux Reservation establishes that nonmember Indians have an interes t in tribal self government. It points to language setting aside land for the use of the Sioux Nation and "for such other friendly tribes o r individual Indians as from time to time they may be willing . . . to admit amongst them." Art. 2. (15 Stat. 653). Nonme mber Indians living on the reservation are not in fact involved in tribal self government, however. The Che yenne River Sioux Tribe's constitution and bylaws do not allo w nonmember Indians to vote in tribal elections or hold office on th e reservation.
The tribe also argues that at a mini mum any Sioux Indian residing on its reservation shoul d be immune from taxation because all Sioux are part of the Sioux Nation. The Great Sioux Reservation was divided into separat e reservations for various

### They actually seek damages for payments by all reservation 14 

### Indians of both the excise tax and the registration fee, but the claims of nonmembers and those claims based on the registration fee are foreclosed for the reasons already discussed.
15 Sioux tribes, includi ng the Cheyenne River Sioux. Although the different Sioux tribes share common ties, they exist as se parate entities with their
own constitutions and governing structures. Nonmember Sioux residing on the Cheyenne River reservation are not allowed t o vote or hold office, and are not actually constituents of the governing tribe.

D.

The Unit ed States and the tribe argue that monetary damages shoul d be awarded to compensate for past payments of the excise taxes by tribal members. The district court rejected the claim for damages becaus e

1 4 previo us cases addressing motor vehicle taxation had not been applie d retr oactively. South Dakota offers several alternative rationales fo r denying monetary relief.

The district court correctly noted that the opinions in Moe , Colville , and Sac and Fox did not grant retroactive relief, but those case s did not involve claim s for monetary damages. Rather they were claims for declaratoryand injunctive relief. When a state tax is declared to b e invalid either "becau se . . . it [is] beyond the State's power to impose" or "because the taxpa yers were absolutely immune from the tax," the State must "'undo' the unlawful deprivation by refundi ng the tax previously paid under d uress." McKesson Corp. v. Division of Alcoholic Beverages an d Tobacc o , 496 U.S. 18, 39 (1990) (citing Ward v. Love County Board o f Comm'rs , 253 U.S. 17, 24 (1920)). In other words, the holding in suc h cases would be applied retroactively.

The s tate claims that a damage award is barred by the Elevent h Amendment. It cites Blatchford v. Native Village of Noatak , 501

### Blatchford distinguished its facts from those in Moe where 15 

### there was federal jurisdiction over a state tax injunction action brought by an Indian tribe. Blatchford suggested that such actions do not implicate the Eleventh Amendment when brought against state officers rather than the state itself. 501 U.S. at 785 n. 3. ( Moe held that the Tax Injunction Act, 28 U.S.C. § 1341, did not deprive federal courts of jurisdiction over tax injunction claims brought by Indian tribes, because Congress had separately provided for jurisdiction over tribal claims in 28 U.S.C. § 1362. 425 U.S. at 472-75). 16 U.S
. 775 (1991), in which the Supreme Court held that the Elevent h Amen dment would bar damage claims brought by Indian tribes against a state. The Eleventh Amendment does not bar suits brought by the United

15 States on behalf of Indian tribes or their members, however. United State s v. Minnesota , 270 U.S . 181, 195 (1926); United States v. Board of Comm'rs of Osage County , 251 U.S. 128, 133 (1919). The BlatchfordCourt recognize d that the tribal claims would not have been barre d if brought by the United States, but held that tribal access to federal court was not as broad

. Blatchford , 501 U.S. at 783-84. The Eleventh Amendment does not apply in the Cheyenne River case because the United States brought the action.

The state also argues that damages should be denied because payment of th e taxes was required by tribal law and thus was not coerced by th e state. A 1987 resolu tion incorporated into tribal law certain provisions of the South Dakota T raffic Code, including the requirement that vehicles bear valid state license plates. Neither that r esolution nor a clarifying resolution passed in 1990 addressed the payment of the state excise tax or suggested that its collection from tribal members was valid. The tribal council has consistently protested the imposition of state motor vehicle taxes on its members, and has now adopted its own registration system.

An additional argument by the state is that the excise taxes wer e paid voluntarily and thus cannot be recovered back as a matter of law or equity. Taxes that are voluntarily paid because of a

### 17

mista ke of law cannot be recovered back, see Security National Bank o f Watertown v. Young , 55 F.2d 616, 619 (8th Cir.), cert. denied , 286 U.S. 55 1 (1932), but taxes paid under duress or coercion are recoverable, and state refund procedures do not limit such recovery. McKesson , 496 U.S. at 31; Board of Comm'rs of Jackson County v. United States , 308 U.S. 343, 35 0 (1939) (citing Osage County , 251 U.S. 128 and Ward , 253 U.S. 17).

The recor d related to the nature and amount of the damage claims in the Cheyenne River ca se has not been fully developed. There is anecdotal evidence describing informal protests by several tribal members at the tim e of payment, claiming that the tax was paid to avoid criminal penalties, an d suggesting that the state refund procedure is inadequate. These issues
were not reached by the district court because of the mistaken view that damages were necessarily barred. The judgment should be reversed to the exte nt that it eliminated any possibility of damages. On remand th e district court shoulddetermine whether damages should be awarded and, if so, in what amount.

II.

The Rosebud Sioux Tribe is also a fe derally recognized Indian tribe, and the initial history of the Rosebud Indian Reservation parallels that of the Che yenne River reservation. Initially part of the Great Siou x Reserva tion established by the Fort Laramie Treaty, 15 Stat. 635, th e Rosebud reservation was set apart by the Act of March 2, 1889, 25 Stat

. 888, 892. The reservation was diminished by Congressional acts near the turn of the century, and now consists of Todd County, South Dakota. See Rosebud S ioux Tribe v. Kneip , 430 U.S. 584, 615 (1977). Tribal member s living on allotted lands outside the reservation are considered to be in Indian country. Id. at 615 n. 48.
On October 3, 1994, the Rosebud Sioux Tribe brought suit in

### At the time the case was argued on appeal, there was no 16 

### indication that the case had proceeded any further in district court. The Secretary has yet to file an answer to the complaint or to assert any defenses.
18 federal district court against the South Dakota Secretary of Revenue for declar atoryand injunctive relief against the imposition of state moto r vehicle excise taxes and registration fees on Indians residing on th e
res ervation. The case was assigned to the same judge before whom th e Cheyenne River action was pending. The Secretary filed a motion t o dismiss, and the tribe moved for a preliminary injunction.

On Februa ry 23, 1995, the same day that judgment was entered in the Cheyenne River case, the district court held a hearing on the motions in the Rosebud case. OnMay 23, 1995 it issued an opinion and order denying the Secretary's motion to dismiss, partially granting and partially denyin g the tribe's request for a preliminary injunction, and transferring the cas e to another judge. Th e opinion and order was short, and the court did not make detailed findings or discuss the basis for its disposition.
The district court's opinion recogni zed that the issues were similar to those raised in the Cheyenne River case. It granted a preliminar y injunc tion against the collection of the motor vehicle registration fe e from tribal members w ho drive only within the undiminished portion of the Rosebud reservation, but denied the tribe's motion in all other respects. It did not specifically enjoin the collection of the excise tax from triba l members living on the reservation, and the tribe filed this interlocutory appeal from that partial denial of its motion. 16

The R osebud tribe argues that the reasoning in the Cheyenne Rive r case should apply to Indians residing on the Rosebud reservation and that the d istrict court erred by failing to enter an injunction against th e collection of excise taxes. The tribe

### The Rosebud tribe also seeks entry of judgment in its 17 

### favor on the excise tax issue, but the only issues before us on this interlocutory appeal relate to the injunction.
19 argues that the order is inconsistent with the Cheyenne River judgmen t because it did not enjoin the state from continuing to collect excise taxe s from members of the Rosebud tribe living on the reservation. The Secretar y responds t hat the district court did not abuse its discretion when i t partial lydenied the motion for a preliminary injunction and that th e merits of the underlying action are not an issue on appeal.
The issue on this interlocutory appe al is whether the district court abused its discretion or committed an error of law. See Dakota Indus., 17 Inc. v. Dakota Sportswear, Inc. , 988 F.2d 61, 63 (8th Cir. 1993). Althoug h the order would be easier to review if it contai ned more detailed findings and reasoning, it appears that the earlier ruling in the Cheyenne Rive r
case was a major factor in the court's thinking. The same judge ha d entered a declaratory judgment in that case three months before, holding that South Dakota cou ld not impose its motor vehicle excise tax on tribal member s living on the reservation. In its opinion in that case, th e distric t court denied injunctive relief since there was "no reason t o beli eve the defendants will not comply with the requirements of thi s decision." Implicit in its Rosebud ruling is a similar assumption that th e state was complying with the requirements of the Cheyenne River decision and had stopped collecting excise taxes from tribal members living o n reservations. Injunc tive relief is unnecessary where there is no showing of irreparable harm, and nothing in the record suggests that South Dakota continues to collect the excise tax from tribal members residing on Indian
res ervations. The tribe has not shown that the grant of only partia l relief was an abuse of discretion or clearly erroneous.

### 20 III.

In co nclusion, the judgment entered in the Cheyenne River case i s affirmed in part and reversed in part and remanded for consideration of th e remaining damages issues. The order granting pa rtial injunctive relief in the Rosebud case is affirmed.
ROSS, Circuit Judge, concurring in part and dissenting in part.
I concur in the majority opinion to the extent that it concludes the State of South Dakota has the authority to impose an annual motor vehicle registration fee on Native Americans who live within the boundaries of a reservation. S.D. Co dified Laws Ann. § 32-5-5. I dissent, however, with respect to the majority's conclusion that the St ate lacks the authority to impose the motor vehicle excise tax set forth in S.D. Codified Laws Ann. § 32-5B-1. In my opinion, the excise tax is indistinguishable from a sale s tax levied on the sale of motor vehicles, and as such is a valid state tax
on a no n-reservation transaction. I also dissent from the majority' s determin ation that the State of South Dakota must refund the taxe s previously paid.

The South Dakota motor vehicle excis e tax is a one-time tax based on the purchase price of a motor vehicle, and is co llected by the county when application is made f or a South Dakota motor vehicle title. S.D. Codified Laws Ann. § 32-5B-10. It is clear that all of t he sales occur outside the reservation. Although the majority attempts to distinguish the excise tax from a sales tax based on the fact that the exci se tax is collected at the time of registration by a government employee, as opposed to at the time of sale by the seller, the excise tax and its method of collection ar e virtually identical to the taxes imposed upon the disposition of moto r vehicles by every other state within our circuit . In all cases, the taxes operate in a similar fashion, yet are given vari ous labels. While each of the seven states within our circuit

### Although Arkansas and Missouri do not have Indian 18 

### reservations within their borders, I note that both of these states impose and collect sales taxes on the disposition of motor vehicles in a manner identical to that of their sister states. The State of Arkansas imposes a "gross receipts tax" on the sale of motor vehicles. Ark. Code Ann. § 26-52-510. This tax is "paid by the consumer to the Director of the Department of Finance and Administration instead of being collected by the dealer or seller, . . . at the time of registration." Id . § 26- 52-510(a)(1)(A). Similarly, the State of Missouri imposes a "sales" tax upon the sale of a motor vehicle. The tax is not collected by the seller but by the state department of revenue at the time of registration. Mo. Rev. Stat. §§ 144.069, 144.070.
21 levy similar taxes, I will discuss only those fi ve states, including South Dakota, that also have a reservation within their borders. 18 The Sta te of Nebraska imposes a one-time "sales" tax, based on th e purch ase price of the motor vehicle. Neb. Rev. Stat. § 77-2703(1)(i)

. Although called a "sales" tax, the tax is not co llected by the retailer at the time of the sales transaction, as is the case with retail sales i n general. Id . § 77-2703(1)(a). Instead, the motor vehicle sales tax is collected by a county official at the time the vehicle is registered.

The Sta te of North Dakota imposes a one-time "excise" tax based o n the purch ase price of the motor vehicle. N.D. Cent. Code § 57-40.3-02

. Ag ain, the tax is collected by the director of the department o f transp ortation at the time of vehicle registration. Id . § 57-40.3-12

. Because of the imposition of the motor vehicle excise tax, the sale o f motor vehicles is specifically exempted from North Dakota's sales tax. Id

. § 57-39.2-04(13).

The State of Iowa calls its one-time tax upon the sale of moto r vehicles a "use" tax, Iowa Code Ann. § 423.7, even on the in-stat e purchases of motor vehicles. The tax is collect ed by the county treasurer at the time of vehicle registration. Id . § 423.7. Because of th e impos ition of this use tax, the sale of motor vehicles is specificall y exempted from Iowa's sales tax. Id

.

### 22

§ 422.45(4).
Finally, the State of Minnesota imposes a one-time tax called a "sale s tax on motor vehicles." Minn. Stat. Ann. § 297B.02. The tax i s based on the purchase price of the motor vehicle and is collected by the motor vehi cle registrar, not by the seller at the time of sale. Id

. § 297B.11. As with the other states in our circuit, Minnesota ha s reciprocitywith other states in the form of a use tax, applicable, i n part, to out-of-state purchases. Id . § 297B.08. Again, because of the ta x imposed under § 297B.02, the sale of motor vehicles is specificall y exempted from the general sales taxes levied und er § 297A. Id . § 297B.13. A particularly interesting point to note regarding Minnesota's moto r vehicle tax, is that prior to 1994, what is now denominated a "sales tax
on motor vehicles" was labeled a "motor vehicle excise tax." The 199 4 amendment modified on ly the label ascribed to the tax, leaving the taxing scheme otherwise unchanged.

The majo rity attempts to distinguish the taxing scheme found to b e valid in Tunica-Bilox i Tribe v. Louisiana , 964 F.2d 1536 (5th Cir. 1992), noting as significant that " Tunica involved a Louisiana tax on the 'sale at r etail' of any item of property within the state." Ibid . at 9-10

. Regar dless of the label given to the tax by the Louisiana legislature , however, Louisiana's taxing scheme is virtually identical to every other mot or vehicle taxing scheme within our circuit. Relying exclusively o n form rather than substance, the majority overloo ks the fact that Louisiana sales tax on motor vehicles is collected, not by the seller at the time of the sale, but by the "vehicle commissioner as the agent of the collector of revenue at the time of application for a certificate of title or vehicl e registration license." La. Rev. Stat. Ann. § 47:303B(1).

The majority's attempt to distinguish the Louisiana tax from th e South Dakota tax is simply unavailing. The majority's only

### 23

noted distinction between the two taxes is that "[p]urchasers from outside Louisiana could also be subject to the sales tax unlike the South Dakota tax which is not appl ied to out-of-state purchasers." Ibid . at 10. This is a distinction without basis. Both the South Dakota and the Louisiana taxes are identical in that neither differentiates between resident or non

resident purchasers in the imposition of their r espective taxes. Instead, both resident and non-resident purchasers must p ay the tax at the time the vehicle is registered in either South Dakota or Louisiana, unless th e purchaser can show that the tax has been paid to another state. This is simply the use tax component of a typical sales tax scheme and in no way det racts from its characterization as a sales tax. But for the labe l attributed to the taxes, Tunica is indistinguishable from the case no w before us.

I also disagree with the majority that the South Dakota excise ta x resembles the persona l property taxes found to be invalid in Oklahoma Tax Co mm'n v. Sac and Fox Nation , 508 U.S. 114 (1993); Washington v

. Confederated Tribes of Colville Indian Reservation , 447 U.S. 134 (1980); and Moe v. Confederated Salish and Kootenai Tribes , 425 U.S. 463 (1976). In both Colville and Moe , the court invalidated the imposition of taxe s assessed annuallyat a percentage of market value of the vehicles

. Rejecting the State o f Washington's attempt to exalt form over substance, the Court noted that "the only difference between the taxes [in Colville] and the one struck down in Moe is that [the former] are called excise taxe s and imposed for the privilege of using the vehic le in the State, while the Montana tax was labeled a personal property tax." Colville , 447 U.S. at 163. The important d istinction between the taxes in Colville and Moe and the Sou th Dakota excise tax, is that the taxes in Colville and Moe wer e annual taxes contingent upon the continued ownership of a motor vehicle. In sharp contrast, th e tax at issue here is a one-time tax triggered upon the di sposition of a motor vehicle. Colville and Moe simply are no t controlling in the present case.

### Oklahoma's "sales" tax levied on motor vehicles was not 19 

### challenged in Sac and Fox

. 24 Sac and Fox

is also distinguishable from the case now before us . The Supreme Court noted as significant several times throughout its discussion that the excise tax at issue in Sac and Fox was paid "in addition to the sta te sales tax," 508 U.S. at 119, 126, 127. Accordingly, the Cour t 19 rejected the state's argument that the excise ta x resembled a sales tax on transactio ns occurring outside Indian country. Id . at 126. Just th e opposite is true here, where South Dakota law sp ecifically states that the excise tax "shall be in lieu of any tax levied . . . on the sales of such vehicle s." S.D. Codified Laws Ann. § 32-5B-1. Unlike Sac and Fox , th e South Dakota motor vehicle excise tax is meant to be in lieu of the state' s sales tax, not to augment it.
In my vie w, the majority relies upon distinctions without substance in conc luding that the excise tax is not the equivalent of a sales tax

. Fir st, the majority finds significant the fact that the tax is no t collected by the automobile dealer at the time o f the sale, but instead is collected by the county treasurer at the time application is made for a South Dakota motor vehicle title. As previously stated, however, thi s procedure in tax collection is the same procedure used by all of the state s within our circuit, including those that call the tax a "sales" tax.

Second , the majority makes much of the fact that "the tax does no t apply to all motor vehicle sales in the state, b ut only to those resulting in ownership by a South Dakota resident," and "[c]onversely, the excise ta x does apply to vehicle s purchased out of state by South Dakota residents." Ib id

. at 9. What the majority describes, however, is simply th e complementary use tax element of a retail sales tax scheme. See , e.g. , La
. Rev. Stat. Ann. § 47:303A(3); Minn. Stat. Ann. §§ 297A.14(1), (2), 297B.08 ; Neb. Rev. Stat. § 77-2703(2). The existence of a use tax within

### 25

the state's taxing scheme does not nullify, or in any way alter, the natur e of its sales tax.

South Dak ota's excise tax is the equivalent of a sales tax on motor vehicles. The fact that the tax is applied only to motor vehicles and not the general sale of p ersonal property does not alter the substance of the tax in any way. My concern with the holding ado pted by the majority today is th e far-reaching ramifications this decision is sure to have on th e taxing schemes of other states within our circuit, and conceivably in othe r circuits as well. Each of the remaining four states within our circuit, which also have India n reservations within their boundaries, impose motor vehicle taxes virtual ly identical to that struck down by our court today. As wi th South Dakota, the remaining four states impose a one-time tax ; based on the purchase price of the motor vehicle; imposed in lieu of the general retail sales tax; collected not by the retailer at the time o f sale, but by a county official at the time of registration; and hav e complementaryuse tax provisions. Two of the four states now call their one-time tax a "sales" tax, although identical in all other respects to th e "use" or "excise" taxes of their sister states. The question is whether this difference in nomenclature will be sufficient to withstand our court' s scrutiny?
By failing to recognize the similari ties between Louisiana and South Dakota's taxing schemes, the majority now creates a split among th e circuits with regard to the validity of taxing the off-reservation sales of motor vehicles. Further, by failing to recognize the distinct method of collecting motor v ehicle sales taxes, as opposed to other retail sales taxes, by every state in our circuit and possibly the majority of states
acr oss this country, our court today takes a step toward a blanke t invali dation of sales taxes on the off-reservation purchases of moto r vehicles. This clearly intrudes upon the Suprem e Court's affirmation that "Indians going beyond reservation boundaries have generally been

### 26

held subject to non-discriminatory state law otherwise applicable to all citizens of the State," including its state tax laws. Mescalero Apach e Tribe v. Jones , 411 U.S. 145, 148-49 (1973).

Because i t is my opinion that the South Dakota excise tax functions as a valid sales tax of off-reservation transactions, I would uphold S.D. Codified Laws Ann. § 32-5B-1. Accordingly, I respectfully dissent from th e majorityopinion to the extent that it concludes otherwise. I note that the other states with in our circuit may wish to seek leave to file amicus briefs in the event a petition for rehearing is requested and granted in this case.

A true copy.

Attest:

CLERK, U. S. COURT OF APPEALS, EIGHTH CIRCUIT.