FOR PUBLICATION

UNITED STATES COURT OF APPEALS

FOR THE NINTH CIRCUIT

QUINAULT INDIAN NATION,

Plaintiff-Appellee,

v.

MARY LINDA PEARSON,

Administrator Ad Prosequendum for 

the estate of Edward A. Comenout,

Defendant-Appellant.

No. 15-35263

D.C. No.

3:10-cv-05345-

BHS

QUINAULT INDIAN NATION,

Plaintiff-Appellee,

v.

MARY LINDA PEARSON,

Administrator Ad Prosequendum for 

the estate of Edward A. Comenout,

Defendant,

and

ROBERT R. COMENOUT, SR.,

Defendant-Appellant.

No. 15-35267

D.C. No.

3:10-cv-05345-

BHS

OPINION
2 QUINAULT INDIAN NATION V. PEARSON

Appeal from the United States District Court

for the Western District of Washington

Benjamin H. Settle, District Judge, Presiding

Submitted June 9, 2017*

Seattle, Washington

Filed August 29, 2017

Before: M. Margaret McKeown, Consuelo M. Callahan, 

and Sandra S. Ikuta, Circuit Judges.

Opinion by Judge McKeown

SUMMARY**

Tribal Sovereign Immunity

In an action brought by the Quinault Indian Nation 

alleging a scheme to defraud the Nation of cigarette taxes, 

the panel affirmed the district court’s dismissal of 

counterclaims as barred by the Nation’s sovereign 

immunity.

The panel held that if brought in a separate suit against 

the Nation, the counterclaims would be barred by sovereign 

immunity. Asserting the claims as counterclaims did not 

 * The panel unanimously concludes this case is suitable for decision 

without oral argument. See Fed. R. App. P. 34(a)(2).

** This summary constitutes no part of the opinion of the court. It 

has been prepared by court staff for the convenience of the reader.
QUINAULT INDIAN NATION V. PEARSON 3

change the sovereign-immunity analysis. The panel 

concluded that the Nation did not waive its sovereign 

immunity because it filed the underlying suit but took no 

further action that unequivocally waived its immunity to the 

counterclaims, and the counterclaims did not qualify as 

claims for recoupment.

COUNSEL

Robert E. Kovacevich, Spokane, Washington; Randal B. 

Brown, Covington, Washington; Aaron L. Lowe, Spokane, 

Washington; for Defendants-Appellants.

Rob Roy Smith, Kilpatrick Townsend & Stockton LLP, 

Seattle, Washington, for Plaintiffs-Appellees.

OPINION

McKEOWN, Circuit Judge:

Once again, the issue of tribal sovereign immunity and 

cigarette taxes is back in the federal courts. In this iteration, 

the Quinault Indian Nation (the “Nation”) sued Edward A. 

Comenout, Jr.; Robert R. Comenout, Sr.; and other 

defendants for engaging in a scheme to defraud the Nation 

of taxes. When the Nation later asked the district court to 

dismiss its action, Edward’s estate (the “Estate”) sought to 

keep the litigation alive, asserting that maintaining the suit 

was necessary to litigate its counterclaims against the 

Nation.

The district court dismissed the counterclaims as barred 

by the Nation’s sovereign immunity. Because the court 
4 QUINAULT INDIAN NATION V. PEARSON

correctly held that the Nation retains its sovereign immunity 

as to the counterclaims, these claims were properly

dismissed. We agree that the Estate cannot hold up dismissal 

of the suit. We affirm.

Background

Edward Comenout, now deceased, was an enrolled 

member of the Quinault Indian Nation, a federally 

recognized Indian tribe. Beginning in 1971, he operated a 

convenience store, the Indian Country Store, on land held in 

trust by the United States in Puyallup, Washington. The 

store, which is now run by his brother Robert Comenout, 

sells cigarettes and tobacco products.

For years, the Comenouts have been embroiled in 

litigation about whether they must pay cigarette taxes. They 

have contested the authority of the State of Washington and 

the Nation to tax them at every turn. For example, in 

criminal proceedings initiated in 2008, they contended that 

they are exempt from Washington’s cigarette tax, but the 

Washington Supreme Court disagreed. State v. Comenout, 

267 P.3d 355, 358 (Wash. 2011).1 Similarly, in litigation 

with the Nation, including the lawsuit on appeal here, the 

Comenouts have continually disputed the Nation’s ability to 

collect cigarette taxes pursuant to an agreement with 

Washington. See, e.g., Comenout v. Whitener, No. 15-

35261, 2017 WL 2591272 (9th Cir. June 15, 2017); 

Comenout v. Wash. State Liquor Control Bd., 195 Wash. 

App. 1035 (2016). The legal battles rage on.

In this round, the Nation brought suit against the 

Comenouts and other defendants in May 2010 claiming that 

 1 Robert Comenout has since pled guilty to state criminal charges.
QUINAULT INDIAN NATION V. PEARSON 5

the Indian Country Store was selling untaxed cigarettes and 

tobacco products. The Nation’s complaint alleged that the 

Comenouts violated the Racketeer Influenced and Corrupt 

Organizations Act (“RICO”) by defrauding the Nation of 

cigarette taxes and requested $90 million in unpaid tax 

revenue. The Nation also pled a $30 million breach of 

contract claim against Edward Comenout.

In December 2010, after Edward’s death, the Estate 

asserted counterclaims. The Estate sought a declaratory 

judgment that Edward had not violated the Cigarette Sales 

and Tax Code. It also asked for an order compelling the 

grant of building and business permits and for mandamus 

relief, lost profits, and damages due to an alleged antitrust 

and price-fixing scheme perpetrated by the Nation.

When out-of-court events sufficiently resolved the 

Nation’s impetus for bringing the lawsuit in the first place, 

the Nation moved to dismiss the Estate’s counterclaims and 

voluntarily dismiss the entire action under Federal Rule of 

Civil Procedure 41(a). The Estate opposed dismissal of its 

counterclaims and moved to amend. The district court 

granted the Nation’s motions to dismiss, reasoning that the 

Estate’s counterclaims are barred by the Nation’s sovereign 

immunity. Because the Estate’s proposed amendments did 

not cure the sovereign-immunity problem, the court also 

denied the motion to amend as futile.

Discussion

We start with the basics of sovereign immunity. It is well 

settled that Indian tribes possess tribal sovereign immunity 

because they are “domestic dependent nations that exercise 

inherent sovereign authority.” Michigan v. Bay Mills Indian 

Cmty., 134 S. Ct. 2024, 2030 (2014) (internal quotation 

marks and citation omitted). As the name implies, that 
6 QUINAULT INDIAN NATION V. PEARSON

immunity is a “common-law immunity from suit 

traditionally enjoyed by sovereign powers.” Santa Clara 

Pueblo v. Martinez, 436 U.S. 49, 58 (1978). Tribes are 

shielded not only from suits for money damages, but from 

declaratory and injunctive relief as well. Imperial Granite 

Co. v. Pala Band of Mission Indians, 940 F.2d 1269, 1271 

(9th Cir. 1991). Although a suit may be maintained against 

tribal officers in certain circumstances, the tribes themselves 

are protected. See Salt River Project Agric. Improvement & 

Power Dist. v. Lee, 672 F.3d 1176, 1181 (9th Cir. 2012).

Under these simple rules, if the Estate had brought its 

claims in a separate suit against the Nation, the suit could not 

proceed. The Estate seeks monetary, declaratory, and 

injunctive relief from the Nation itself, all of which would 

be barred by the Nation’s sovereign immunity.2 The 

operative question in this appeal is whether the Estate’s 

counterclaims are similarly barred. In other words, we must 

determine whether asserting these claims for relief as 

counterclaims changes the sovereign-immunity analysis. On 

the facts of this case, we hold that it does not.

I. No Waiver of Tribal Sovereign Immunity

A tribe’s sovereign immunity is a powerful protection 

from suit, but it is not impenetrable and may be surrendered. 

See Kiowa Tribe of Okla. v. Mfg. Techs., Inc., 523 U.S. 751, 

754 (1998). Nevertheless, a sovereign-immunity waiver is 

 2 For this reason, the Estate’s counterclaims could not “remain 

pending for independent adjudication,” and the district court could not 

simply dismiss the action “over the [Estate]’s objection.” Fed. R. Civ. 

P. 41(a)(2). Instead, the district court first dismissed the counterclaims 

as barred by the Nation’s sovereign immunity. At this point, no 

counterclaims remained, and the action was dismissed under Rule 

41(a)(2).
QUINAULT INDIAN NATION V. PEARSON 7

effective only if it is “unequivocally expressed.” Santa 

Clara Pueblo, 436 U.S. at 58 (citation omitted). Here, the 

Nation filed the underlying suit but took no further action 

that unequivocally waived its immunity to the Estate’s 

counterclaims. Nor do the Estate’s counterclaims qualify as 

claims for recoupment. Accordingly, we reject the Estate’s 

contention that the Nation has waived its sovereign 

immunity.

A. Filing Suit Does Not Result in Wholesale 

Waiver

We start with the unremarkable premise that the bare act 

of filing suit does not operate as a complete, automatic 

waiver that subjects a tribe to any counterclaims filed by the 

defendant. McClendon v. United States, 885 F.2d 627, 630 

(9th Cir. 1989). The Supreme Court has proclaimed that “a 

tribe does not waive its sovereign immunity from actions 

that could not otherwise be brought against it merely because 

those actions were pleaded in a counterclaim to an action 

filed by the tribe.” Okla. Tax Comm’n v. Citizen Band 

Potawatomi Indian Tribe of Okla., 498 U.S. 505, 509 (1991). 

Tribal immunity even extends to compulsory counterclaims 

in excess of the original claims—despite the fact that 

compulsory counterclaims by definition arise out of the same 

transaction or occurrence. See id. at 509–10; United States 

v. U.S. Fid. & Guar. Co., 309 U.S. 506, 513 (1940). On this 

point, “Supreme Court precedent couldn’t be clearer . . . : a 

tribe’s decision to go to court doesn’t automatically open it 

up to counterclaims—even compulsory ones.” Ute Indian 

Tribe of the Uintah & Ouray Reservation v. Utah, 790 F.3d 

1000, 1011 (10th Cir. 2015), cert. denied, 136 S. Ct. 1451 

(2016).

Thus, the mere fact that the Nation initiated this action is 

not enough for the Estate to assert its barrage of 
8 QUINAULT INDIAN NATION V. PEARSON

counterclaims without offending the Nation’s sovereign 

immunity. Unless the Estate can identify something that the 

Nation has done to waive its immunity as to one or all of the 

counterclaims, the Nation’s immunity from suit remains 

intact.

B. The Nation Has Not Waived Immunity to 

Individual Counterclaims

In rare instances, a tribe’s participation in a lawsuit can 

“effect a waiver for limited purposes.” Cohen’s Handbook 

of Federal Indian Law § 7.05[1][c], at 645 (Nell Jessup 

Newton ed., 2012). The scope of the waiver depends on the 

particular circumstances, including the tribe’s actions and 

statements as well as the nature and bounds of the dispute 

that the tribe put before the court. See McClendon, 885 F.2d 

at 630–31. We demand clarity that the tribe gave up its 

immunity. See United States v. Nordic Vill. Inc., 503 U.S. 

30, 34 (1992) (stating that ambiguity in the waiver of 

sovereign immunity should be construed in favor of 

immunity). Proceeding through the Estate’s counterclaims, 

we conclude that the Nation has not expressly waived its 

immunity to any of them.

The Nation’s only relevant conduct is that it brought suit 

against the Comenouts for RICO violations and breach of 

contract, alleging that the Comenouts defrauded the Nation 

of cigarette taxes. The Estate’s four counterclaims seek: 

(1) building and business permits and a declaratory 

judgment that Edward Comenout did not violate the tax 

code, (2) lost profits and other damages resulting from the 

Nation’s refusal to grant permits and related to the filing of 

the suit, (3) mandamus relief in the form of a building 

permit, and (4) treble damages for loss of income based on 

an alleged price-fixing scheme between the Nation and the 

State of Washington.
QUINAULT INDIAN NATION V. PEARSON 9

The Estate requests some affirmative relief distinct from 

what the Nation seeks. Counterclaims (1) and (3) ask the 

court to order the Nation to issue building and business 

permits, and counterclaim (2) seeks lost profits and other 

damages for the refusal to issue permits and for the filing of 

the suit. In counterclaim (4), the Estate requests money 

damages based on facts that are even more far-flung from 

the Nation’s RICO and contract claims, alleging that the 

Nation conspired with the State of Washington to fix 

cigarette prices. The entirety of counterclaims (2), (3), and 

(4) and part of counterclaim (1) go beyond the contours of 

the Nation’s suit, so the Nation cannot be said to have 

unequivocally consented to their adjudication. See 

McClendon, 885 F.2d at 630.

Sovereign immunity also bars the remainder of 

counterclaim (1), which seeks a declaration that the Estate 

obeyed the tax code, though that claim admittedly presents a 

closer call. In particular, the Nation’s “[i]nitiation of [the] 

lawsuit necessarily establishe[d] consent to the court’s 

adjudication of the merits of that particular controversy,” 

and the declaratory judgment mirrors the merits of the RICO 

controversy that the Nation asked the court to resolve. See 

id. But while the Nation took the risk that the court would 

rule for the Estate on the merits and deny the Nation’s 

requested legal relief, the Nation did not waive its immunity 

because it did not consent to any counterclaims. See id. The 

Estate could assert affirmative defenses against the Nation’s 

claims, but it could not bring counterclaims absent waiver of 

sovereign immunity.

That conclusion is reinforced by what is required for an 

unequivocal waiver of tribal sovereign immunity. Our 

situation involves far less than Rupp v. Omaha Indian Tribe, 

45 F.3d 1241 (8th Cir. 1995). There, the Eighth Circuit 
10 QUINAULT INDIAN NATION V. PEARSON

allowed counterclaims to quiet title and for damages to be 

asserted against a tribe that filed a quiet-title action. Id. at 

1244–45. However, the tribe there did more than file a 

lawsuit: it invoked the district court’s equitable power to 

determine the status of land and explicitly asked that the 

court order the defendants to “assert any claims in the 

disputed lands they possessed against the Tribe.” Id. at 

1244. The Nation’s actions do not rise to that level of 

unequivocal consent to the declaratory judgment 

counterclaim.

A decision from our circuit, United States v. Oregon, 

657 F.2d 1009 (9th Cir. 1981), requires more discussion, but 

leaves us in the same place: the tribe there demonstrated its 

unequivocal consent. The United States initiated an action 

to apportion a fishery among competing sovereigns, and the 

Yakima Tribe intervened. Id. at 1011. The parties 

(including the tribe) reached a suitable agreement, which 

provided for continuing jurisdiction in the district court over 

future disputes. Id. Years later, the State of Washington 

intervened and argued that the district court needed to enjoin 

the tribe’s fishing so that the fish would not die out. Id. The 

question was whether the district court could enter such an 

injunction consistent with the tribe’s sovereign immunity. 

Id. at 1012.

We said that the injunction was allowed. We analogized 

the underlying suit to an equitable in rem action whose 

purpose was to preserve the res—the fishery—by keeping 

the fish alive. Id. at 1015–16. In that respect, the district 

court could enjoin any interference with the res. Id. at 1016. 

Because the tribe intervened in the equitable action and 

expressly agreed to submit later-arising issues to federal 

court, it “assumed the risk that any equitable judgment 

secured could be modified if warranted by changed 
QUINAULT INDIAN NATION V. PEARSON 11

circumstances” and “that [it] would be bound by an order it 

deemed adverse.” Id. at 1015. We were cognizant of the 

risk of “transform[ing] [tribal immunity] into a rule that 

tribes may never lose a lawsuit.” Id. at 1014.

Oregon “tests the outer limits of [the Supreme Court]’s 

admonition against implied waivers.” Pan Am. Co. v. 

Sycuan Band of Mission Indians, 884 F.2d 416, 420 (9th Cir. 

1989); see also Am. Indian Agric. Credit Consortium, Inc. v. 

Standing Rock Sioux Tribe, 780 F.2d 1374, 1380 (8th Cir. 

1985) (disapproving of Oregon as “press[ing] the outer 

boundary” of what constitutes an unequivocal waiver). And 

there are materially relevant differences between that 

situation and our situation. Unlike the Nation, the tribe in 

Oregon entered an agreement expressing its unequivocal 

consent to submit issues to federal court. Further, the suit in 

Oregon was akin to an equitable in rem action, whereas the 

Nation’s suit is legal, not equitable, in nature. That 

distinction matters because the court in Oregon relied on the 

equitable nature of the action to distinguish the scenario we 

have here—namely, an action involving a compulsory 

counterclaim asserted against the tribe. 657 F.2d at 1015. 

We have previously distinguished Oregon on these same 

grounds. See Squaxin Island Tribe v. Washington, 781 F.2d 

715, 723 n.11 (9th Cir. 1986); Chemehuevi Indian Tribe v. 

Cal. State Bd. of Equalization, 757 F.2d 1047, 1053 n.7 (9th 

Cir.), rev’d on other grounds, 474 U.S. 9 (1985).

Oregon’s broader concern about tribes employing 

sovereign immunity offensively to prevent a loss in court is 

not present here because, even without its counterclaim, the 

Estate could still defend against the Nation’s RICO claim. 

In fact, the Estate’s counterclaim is duplicative because the 

Estate separately pled an affirmative defense that it had not 

violated RICO. Therefore, the district court properly 
12 QUINAULT INDIAN NATION V. PEARSON

dismissed the Estate’s counterclaims, and they cannot act as 

life support for a lawsuit that the Nation is ready to put to 

rest. The Estate’s asserted ability to drag out the proceedings 

and hold the Nation hostage in its own litigation is a direct 

affront to the Nation’s sovereign immunity when there has 

been no unequivocal waiver.

C. The Estate Has Not Asserted a Counterclaim 

for Recoupment

The Estate offers one other justification for maintaining 

its counterclaims against the Nation: it contends that the 

counterclaims count as claims for recoupment. We agree 

that counterclaims to recoup damages arising from the same 

transaction or occurrence as a tribe’s claims do not violate 

the tribe’s sovereign immunity. Nevertheless, the Estate’s 

argument still falters because its counterclaims do not sound 

in recoupment.

The legal basis for permitting adjudication of matters in 

recoupment is straightforward. In the analogous scenario 

where the United States brings suit, the Supreme Court has 

held that the United States impliedly waives its immunity to 

counterclaims for recoupment. Bull v. United States, 

295 U.S. 247, 260–63 (1935). Those claims do not directly 

implicate sovereignty interests because they seek merely an 

offset to the sovereign’s requested relief instead of 

affirmative relief from the sovereign. See id. at 262 

(“[R]ecoupment is in the nature of a defense arising out of 

some feature of the transaction upon which the plaintiff’s 

action is grounded.”); United States v. Agnew, 423 F.2d 513, 

514 (9th Cir. 1970) (stating that claims for recoupment 

“defeat or diminish the sovereign’s recovery” but provide no 

“affirmative relief”). That rule and rationale holds for tribes. 

See Hamilton v. Nakai, 453 F.2d 152, 158 (9th Cir. 1971) 

(explaining that a tribe’s sovereign immunity is generally 
QUINAULT INDIAN NATION V. PEARSON 13

coextensive with that of the United States). Thus, we join 

the two other circuits that have held that claims arising out 

of the same transaction or occurrence and sounding in 

recoupment can be sustained as counterclaims against a 

tribe. See Berrey v. Asarco Inc., 439 F.3d 636, 644–45 (10th 

Cir. 2006); Rosebud Sioux Tribe v. A & P Steel, Inc., 

874 F.2d 550, 552–53 (8th Cir. 1989).

That conclusion does not end our analysis, as we must 

determine whether the Estate’s counterclaims constitute 

claims for recoupment. A recoupment claim “must (1) arise 

from the same transaction or occurrence as the plaintiff’s 

suit; (2) seek relief of the same kind or nature as the 

plaintiff’s suit; and (3) seek an amount not in excess of the 

plaintiff’s claim.” United States v. Washington, 853 F.3d 

946, 968 (9th Cir. 2017) (citation omitted). As that 

definition suggests, recoupment claims must be monetary, 

not injunctive or declaratory. Id. Under these standards, 

none of the Estate’s counterclaims are for recoupment.

As a reminder, the Estate wants (1) a declaration that the 

tax code was not violated and building and business permits, 

(2) lost profits and other damages associated with the 

Nation’s refusal to issue permits and filing of the suit, 

(3) mandamus relief in the form of a building permit, and 

(4) treble damages for lost income resulting from an alleged 

price-fixing scheme. Right off the bat, the requests for 

anything other than monetary relief are excluded. That 

leaves on the table the lost profits, damages for filing suit, 

and the lost income for alleged price fixing. Those claims 

fall outside the definition too. The Estate declares injury 

based on the Nation’s denying permits, filing the lawsuit, 

and engaging in a price-fixing scheme, none of which 

logically relates to the occurrence that underlies the Nation’s 

claims—namely, the Estate’s alleged enterprise to withhold 
14 QUINAULT INDIAN NATION V. PEARSON

taxes due. And the damages claimed by the Estate are not 

bounded by the amount sought by the Nation because they 

are tied to the Estate’s lost profits and loss of income, the 

latter multiplied by three. The Estate cannot shoehorn its 

counterclaims into the definition of recoupment. We 

conclude that the counterclaims as pled are barred by the 

Nation’s sovereign immunity.

II. Denial of Motion for Leave to Amend

The Estate’s efforts to overcome the sovereign immunity 

hurdle through amendment are equally unavailing. We have 

no difficulty concluding that the district court did not abuse 

its discretion in denying the Estate leave to amend its answer 

and counterclaims. See Telesaurus VPC, LLC v. Power, 

623 F.3d 998, 1003 (9th Cir. 2010) (reviewing for abuse of 

discretion). The court correctly explained that “the Estate’s 

proposed amendments would be futile in light of the 

Nation’s sovereign immunity.” We agree because the 

proposed amendments failed to include allegations that 

would cure the defects in the original pleading. See Loos v. 

Immersion Corp., 762 F.3d 880, 890–91 (9th Cir. 2014).

In its motion to amend, the Estate sought to add more 

specific facts to support its already-pled claims and describe 

events related to abuse of process and tortious interference. 

Alleging further facts as to the events that occurred does not 

take the Estate’s claims outside the sovereign-immunity bar. 

The Nation would also be immune from suit on claims for 

abuse of process and tortious interference, see Arizona v.

Tohono O’odham Nation, 818 F.3d 549, 563 n.8 (9th Cir. 

2016) (“[T]ribal sovereign immunity bars tort claims against 

an Indian tribe . . . .”), and there is no stronger basis for 

waiver on these claims than on the Estate’s other 

counterclaims. Because the Estate’s amendments do not get 

around the Nation’s sovereign immunity, the district court 
QUINAULT INDIAN NATION V. PEARSON 15

properly rebuffed this final attempt to protract the litigation 

and dismissed the entire action.

AFFIRMED.