NEBRASKA, ET AL., Petitioners v. MITCH PARKER, ET AL
Interviewer(s): Anthony M. Kennedy, Samuel A. Alito, Jr., Stephen G. Breyer, Elena Kagan, John G. Roberts, Jr., Ruth Bader Ginsburg, Antonin Scalia, Sonia Sotomayor
Interviewee(s): James D. Smith, Paul D. Clement, Allon Kedem

John G. Roberts, Jr.: We'll hear argument first this morning in Case 14-1406, Nebraska v. Parker. Mr. Smith.

James D. Smith: Mr. Chief Justice, and may it please the Court: For over a century, the following three things have been true in the disputed area. First, the non-Indian population has always been greater than 98 percent. Second, the Tribe never exercised jurisdiction. And third, by contrast, the State of Nebraska has governed the disputed area. The story of the disputed area is that of a land that long ago lost its Indian character, if it ever had any.

The three things I mentioned at the outset happened for a reason.

They happened because it was the -- or the intent of Congress in the context of the times of the 1882 Act that the disputed area would be diminished from the reservation.

Anthony M. Kennedy: If I understand your position correctly, you're not asking us to overrule Solem?

James D. Smith: No.

No, Your Honor.

We are not asking you to overrule Solem.

In fact, what we are asking the Court to do is to imply -- apply the entire Solem rule and, in particular, the compelling third factor of the subsequent circumstances of the land's jurisdictional history.

As --

Ruth Bader Ginsburg: From what -- from what you just said and from your brief, I gathered -- perhaps I was wrong -- that you are arguing for a de facto diminishment test; that is, you pointed out the area has been overwhelmingly populated by non-Indians and they -- they -- they haven't attempted before to exercise governing authority.

James D. Smith: Your Honor, we think the de facto diminishment does fit within the third element of the Solem test, which is the subsequent circumstances of -- of after the enactment.

And so obviously we would not be opposed to the Court concluding and reaching this decision on the grounds of de facto diminishment. But we also think this case fits within this Court's precedent under Solem, which would involve -- in -- in our view, the third element of the test is particularly strong and compelling in this case, while in Solem, in that particular case, it was -- it was -- I guess I would call fairly easy to distinguish because, as Solem talks about as far as the events, what took place after the Act, the focus should be -- if you're looking at intent of Congress, you should be looking at what Congress is doing after the Act that is reflective of not understanding essentially that they've diminished the reservation.

Antonin Scalia: It's a different Congress. I mean, to say, you know, a later Congress did thus and so, and therefore the earlier Congress, when it enacted a particular statute, must have diminished.

That doesn't make any sense.

James D. Smith: It --

Antonin Scalia: And -- and -- and moreover, if -- if the third factor is dispositive, as -- as you assert, you would not -- we would not need the -- the -- the de facto diminishment doctrine whereby, by a sort of, you know, adverse possession, a jurisdiction, whether it's Indians or -- or even a State that used to have a jurisdiction over a particular area has forfeited it by long-, long-accepted usage to the contrary. If -- if that is true and -- and if -- if the third factor is as important as you say, we would not need that doctrine.

We -- we would just find diminishment.

James D. Smith: Well, and that would be consistent with the concept that, if a party just -- if they belatedly assert a claim to having sovereign authority over this, as in this case it's over a hundred and some years after the land was open for settlement, that -- there -- at least the Sherrill case, some of the principles in this case would be supportive of de facto diminishment.

Antonin Scalia: As far as --

Ruth Bader Ginsburg: That case didn't involve the -- the diminishment.

Diminishment was not an issue.

James D. Smith: That -- that is true.

I -- I -- what I was referring to was the -- the principle at least decided in the case as far as a long-standing assumption of jurisdiction by the State over an area that is primarily non-Indian in -- in population land creates justifiable expectations, and if they did have any sovereignty over it, they had long since forfeited.

Antonin Scalia: But that's not what you're arguing here.

I -- I -- I understand you're arguing diminishment, not -- not adverse possession, so to speak.

James D. Smith: We are arguing that it's no longer part of the reservation.

We are not saying it -- Court could not find it under the de facto, but we do think the facts of this case does fit within Solem.

And if -- and if the Court applies the Solem test, the State should prevail in this case, which --

John G. Roberts, Jr.: You don't -- the other side says you did not raise a City of Sherrill argument.

Do you agree with that?

James D. Smith: We have -- we have --

John G. Roberts, Jr.: A lot of the -- a lot of the arguments you make seem to sound more in a City of Sherrill-type proposition, but you haven't raised that argument, have you?

James D. Smith: We, I -- I believe in paragraphs -- or pages 22, I think it's 25 of our brief, we are at least citing Sherrill as -- as precedent for the principle of loss of sovereignty, loss of sovereign control by the fact that the State has long exercised the jurisdiction. But our focus --

Ruth Bader Ginsburg: But that's based on what Solem said.

Solem did bring up a de facto diminishment. This is on page 471 of the opinion. It says "On a more pragmatic level, we have recognized that who actually moved onto the open reservation lands is also relevant to deciding whether a surplus land Act diminished a reservation.

Where non-Indian settlers flooded into the opening portion of the reservation and the area has long since lost its Indian character, we have acknowledged that de facto if not de jure diminishment may have occurred." This was the theme that was picked up in Sherrill, but it's stated in Solem.

James D. Smith: Yes.

Yes.

Ruth Bader Ginsburg: And may I -- may I ask a preliminary question? We're talking about a liquor license or alcoholic beverage license and a sales tax on alcoholic beverages.

Does the State itself impose such requirements, that is, a licensing requirement and a sales tax?

James D. Smith: The State itself does impose liquor license requirements.

They -- they can in -- State of Nebraska has sales taxes, yes, Your Honor.

Sonia Sotomayor: This tax was not imposed by the Tribe -- Tribe.

This was a statute of Congress that permitted the Indians to do this, correct?

James D. Smith: My recollection was the Interior Department approved the Tribe's request to have such an ordinance, and then -- the Tribe's ordinance then was in -- in effect.

Sonia Sotomayor: Without jurisdictions, Tribes can't tax at will.

They have to get approval for taxation, correct, from the Federal government?

James D. Smith: Your -- your point would be correct, Your Honor.

The Tribe has to request it.

They have to have an ordinance.

It has to be approved by agency of the Federal government.

Yes, that -- that is true, but it still involves granting authority to a -- another sovereign.

Sonia Sotomayor: What -- what else -- what else do you lose if this ruling is against you? We've already circumscribed the powers of the Tribes on their own reservations greatly, so what powers do you lose? You've already ceded to the Federal government criminal prosecution powers.

So you're not losing out on that.

What are you losing out on?

James D. Smith: Well, Your Honor, I -- I -- I take this -- it would be in the context of what are the justifiable expectations of those who live in the disputed area? What would be significantly disrupted as far as their justifiable expectations? I would start off with the first thing -- principle is just who governs you.

Your -- we'd be introducing an additional sovereign, the Tribe, into an area which, for over 130 years, the Tribe has not exercised any sovereign authority at all.

Elena Kagan: Mr. Smith, can -- can I take you back to Justice Scalia's question? You know, because usually, at least now, we don't think much of subsequent history of any kind.

Now, maybe they thought a little bit more highly of it in the days when Solem was written, but now it would -- it's -- it's pretty much of a stretch to use subsequent legislative history or subsequent history generally when we're dealing with interpreting a statute. I'm just wondering: Is there a reason why it should be more credited here than in any other context?

James D. Smith: The Court's precedent, I believe, recognizes in the area of land surplus acts that Indian land surplus acts are a unique animal from your normal legislative analysis.

And that would be because in the context of the times back before the turn of, I guess, two centuries ago in the 1800s, Congress would be doing land surplus acts in which the concept of are we diminishing or not diminishing a reservation was really nothing that Congress thought of. You put that on the basic principle that only Congress can diminish a reservation, it then becomes the problem of how do we determine what Congress intended when, frankly, the reality of the Court's precedent is, it's something that Court -- or Congress generally did not think of.

They were inconsistent. And so the Solem test really evolves out of an attempt to determine what was the intent of Congress at the time, which then is why legislative history, subsequent or -- subsequent circumstances takes on greater significance.

Ruth Bader Ginsburg: When did this diminishment idea as a legal concept -- you said when Congress acted, they weren't thinking in terms of diminishment. When did diminishment become the big question?

James D. Smith: Well, it becomes -- it becomes a big question when the issue is is it part of the reservation --

Ruth Bader Ginsburg: But at what point in time? Because you -- I thought you just made this statement that in 1882 Congress wasn't thinking in terms of diminishment.

James D. Smith: It becomes a big issue when the issue is who -- frankly, who has authority to govern? Is this still part of the reservation or not? Does the Tribe have any authority over this area at all? And if it's part of the reservation, it has authority; acknowledged, it is limited authority, but it would have authority over it, because if it's part of the reservation.

Now --

Samuel A. Alito, Jr.: On that question, as a practical matter, if the Tribe were to exercise -- go to the outer limits of its authority, what could it do in the city of Pender besides opposing this liquor tax?

James D. Smith: Well, what it can do, it can displace State jurisdiction over environmental regulations that this is a rural farming area.

The environment is very important.

State regulation is very important.

It's what the people have expected.

And I could give an example: If you're a farmer, and the guy across the road drops a load of manure in your pond that's being used to feed cattle, you call the State of Nebraska; you want them to come out and you want them to do something.

Those regulations would be replaced.

You call the State of Nebraska and the response is I'm sorry you've called the wrong number.

Antonin Scalia: What about municipalities? What about self-governing -- or more or less self-governing municipalities? Are there any of those within this area?

James D. Smith: Yes.

There are self-governing municipalities.

There are villages.

County, obviously --

Antonin Scalia: What -- would happen to them? Would they continue to -- to exist?

James D. Smith: They would continue to exist, but you're going to have, what I would say, the ambiguity of the extent of their authority versus the extent of the Tribe's authority.

You would have this ambiguity in which is going to be -- I mean, people for 130 years, if you've expected the State of Nebraska, your city council to be exercising local control, and you bring in this outside authority --

Antonin Scalia: Why would they continue to exist? I mean, aren't they creatures of the State? Can the State create municipalities on Indian Reservations?

James D. Smith: I believe -- I believe the State can create the municipalities.

The issue is what authority they have when you also have it on Tribal land, because the Tribe --

Sonia Sotomayor: I'm sorry.

The Tribe has acceded to State sovereignty and the environment and in all sorts of things. Have they threatened to take away the State's activities in this village?

James D. Smith: Not yet.

The issue is going to be --

Sonia Sotomayor: This Tribe is awfully small.

You think they are going to have the power to implement all of these things that you are fearful of? To do substitute services to -- they can't tax for it without the government's permission.

So how are they going to do all these, and why would they do all these horrible things?

James D. Smith: Well, I don't think it's --

Sonia Sotomayor: I mean, it's nice to have the power of taxation, but they still need the government's approval.

James D. Smith: I don't think it's simply the test of being what -- what will they do.

I think the issue is once they have the authority, what --

Sonia Sotomayor: Well, the question of the City of Sherrill says if they try to exercise their powers in a way that's harmful to settled expectations, they might have a remedy in law.

That's what City of Sherrill says, but that didn't take away -- the City of Sherrill didn't say the Indians weren't sovereign.

It just said they can't exercise the sovereignty.

It didn't say it was a diminishment.

What they said is they couldn't exercise it because of latches.

James D. Smith: Well, if you say we've introduced a tribe that in theory has authority, but because they've never exercised it, they really have no authority that -- that by itself, I would say, is the inherent ambiguity of what is actually the limits of their authority.

You get litigations that start disputing whether -- like under the Montana factors, as far as they could regulate conduct that threatens, has some direct effect on their tribe's integrity, economic security, health and welfare.

That's very, very broad. And I -- to me, the -- the answer would be simply to say this is not part of the reservation, rather than every case that comes up when we have litigation and then decide well, you're stopped from doing that.

John G. Roberts, Jr.: Does the Tribe exercise authority in the part of the reservation that's not at issue here?

James D. Smith: Yes.

The Tribe absolutely exercises authority in the part that's not part of the reservation.

They've stipulated to that, that on the part that's not part of the reservation that they -- that they have ordinances, they provide services, that they enforce their ordinances on the east -- in the eastern part of the railroad, which is the -- clearly within the Tribe and not on the west.

So they have had no presence, and they've acknowledged that.

They have no Tribal offices, schools, industries, businesses. They've admitted that all of these governmental services are provided by state and local agencies, not the Tribe. That's the public expectation.

That's what they expect is --

John G. Roberts, Jr.: In the -- in the western part?

James D. Smith: In the western part.

John G. Roberts, Jr.: Well, what about in the eastern part?

James D. Smith: I'm sorry if I wasn't clear. In our -- in the eastern part, the Tribe does have its ordinances.

It does provide services.

It does enforce its ordinances and laws in the eastern part, but not in the western part, and never has.

All of those services are provided by the State of Nebraska. The State of Nebraska, you name it in the form of government services have been provided by the State of Nebraska, its municipalities, not by the Tribe.

This comes in -- we come in; we're going to tax you; we're going to take the money; and maybe you get services, maybe you don't.

And, in fact, the idea of local control is if the people in the disputed area are unhappy about what the Tribe is doing, unlike if it's their local city council, they don't get to vote.

They don't get to remove them from office --

Elena Kagan: Mr. Smith, I -- I can understand why people might be concerned, for all the reasons that you're talking about.

We do have pretty clear and settled law in this area with respect to diminishment, that we've said only Congress can diminish, that the idea is that we're supposed to look to congressional intent.

And you say Congress didn't really think in these terms.

And there's something that's fair about that. But Congress did use very different language in different ones of these acts, and we've looked to that language as a pretty good guide to suggesting which ones diminish and which ones do not.

And it seems as though the language here in -- in the act in which we're concerned -- it's -- it's none of the language that would suggest that Congress diminished this act. So I was wondering if you could talk to that.

Is there anything in the language of this statute that suggests a diminishment? Any of the usual kind of we cede everything, we relinquish everything? Like, what's the best you can do on that?

James D. Smith: Appreciate that, Your Honor. And -- and yes, the standard diminishment test starts with looking at the Act.

Is there language in the Act? Hagen and Solem both specifically say no particular form of words are required. What we do have in this Act is we've got two areas of the reservation.

The area west of the reservation, it's a very well-defined area.

It doesn't create a checkerboard effect. What is significant is the different -- the Act treats the area west of the railroad different than the area east of the railroad.

Specifically -- and this is a major distinction in Solem -- there is nothing reserved for the Tribe in the land on the west of the railroad, the disputed area.

There's nothing reserved for -- in the bullpen, so to speak.

There is no reservation of land-use rights.

There's no reservation of land-use rights for schools, agency, Tribal religious purposes, no reservation in mineral rights. In Solem those were considered significant factors because what you end up with is that the Tribal headquarters, its governmental headquarters ended up in Solem being in the disputed area.

Antonin Scalia: Counsel, do you agree that City of Sherrill did nothing more than deny particular equitable relief and did not repudiate the proposition of Indian sovereignty over the land in question? Because if you agree with that, then I guess I'm more inclined to give greater weight to the third factor. But if you disagree with it, as I think you ought to, then -- then I don't see why we need the third factor.

James D. Smith: Well, City of Sherrill, it does have the element of the Tribe trying to unilaterally just --

Antonin Scalia: Yes, but it says the Tribe doesn't have sovereignty, is what it says.

James D. Smith: It -- well, it says the Tribe doesn't have sovereignty just to buy land back and get back sovereignty that it had long ago lost --

Antonin Scalia: That's right.

James D. Smith: -- and it applies equitable principles to say you're --

Antonin Scalia: To say -- to say that the Tribe does not have sovereignty.

James D. Smith: Yes.

Yes.

And I -- and I think it's perfectly reasonable for the Court to reach that conclusion with a land which long ago it lost its Indian character, long ago they've -- they've never exercised any sovereignty, and then show up after the public, the descendants, everyone who's lived there, and after 130 years you suddenly find out we -- we've got an Indian Tribe that somehow has some governmental authority over us. We've never elected them; we don't have any right to vote them out of office.

If we don't like what we're going to do, I guess we can complain to somebody, but we can't recall members of the Tribal Council. It's -- it is a recognition that those things happened because that's what Congress intended to have happen, and as Solem looks in the context of the times. As far as that legislative history or what -- what happened afterwards, Solem emphasizes the decades immediately after the Act.

And in the decades immediately after this Act, we don't have what Solem talks about, the rife with inconsistencies.

What we have is a total, one hundred percent consistent record that everyone understood. This land was diminished.

It's not part of the reservation.

Congress in -- six years later, and I understand the point about subsequent congressional intent, but at least they did not take an action that would reflect Congress didn't understand what they did.

Elena Kagan: Mr. Smith, on the City of Sherrill point, the Chief Justice asked you before do you agree whether this was -- whether this is waived. And you said, well, we cite City of Sherrill on page 25 or something like that. Below, what was the status of the City of Sherrill argument in the lower courts?

James D. Smith: The -- in the lower courts, the argument -- the argument was made as far as that de facto diminishment can be found.

The Eighth Circuit's opinion is what I would call a --

Elena Kagan: I'm not sure quite what that means.

Does that mean de facto diminishment under Solem, or does that mean -- Solem -- or does that mean that you talked about City of Sherrill as an independent ground?

James D. Smith: We talked about de facto diminishment as an independent ground.

I didn't argue it, but my -- my recollection is Sherrill is not cited for -- as authority for that, but we did make the argument that it was de facto because Solem does say we have recognized de facto diminishment. Mr. Chief Justice, if -- if I may reserve the remainder of my time if there's no further questions.

John G. Roberts, Jr.: Thank you. Mr. Clement.

Paul D. Clement: Mr. Chief Justice, and may it please the Court: The question in this case is whether an 1882 Act of Congress diminished the Omaha Reservation and redrew its boundaries.

We think multiple considerations make clear that the Act of Congress did not diminish the reservation, but simply opened up a portion of the reservation for settlement within the existing boundaries. Now the first, and probably most significant, factor is that the text of the statute uses the classic language this Court has identified for opening up a reservation for settlement without creating a diminishment. But secondly, and I think very telling and specific to this statute, at the same time there is no language in the statute that supports a finding of diminishment.

I think there is language in the statute. Specifically, the final proviso of Section 8 that is very inconsistent with the idea that what Congress did is draw a new western boundary to the reservation, because the -- that proviso gave Tribal members the right to take their allotments east or west of the right-of-way. And the record reflects that many -- that -- that a number of members of the Tribe took their allotments west of the right-of-way.

And importantly, a number of them took their allotments that actually straddled the right-of-way.

John G. Roberts, Jr.: What number? What -- what is the number?

Paul D. Clement: There are 15 --

John G. Roberts, Jr.: Nine?

Paul D. Clement: No, 15, I think -- excuse me -- between 10 and 15, about 850 to 900 acres.

But I don't think --

John G. Roberts, Jr.: Out -- out of how many that took allotments?

Paul D. Clement: Out of how many Tribal members? I think there were roughly 300-plus allotments.

So it was, you know, three percent. But I think the fact that they were allowed, even though they're small numbers -- I'm not trying to make a -- a volume argument here.

I'm making an argument that if what Congress just did is draw a new western boundary to the reservation, it would have been very odd to allow Tribal members to take their allotments off the reservation, and maybe odder still to allow them to take an allotment that essentially was bisected by the new boundary.

John G. Roberts, Jr.: Why would that be odd? They -- they could have taken allotments anywhere, couldn't they --

Paul D. Clement: Anywhere --

John G. Roberts, Jr.: -- within the area that was opened up? Couldn't they have chosen to purchase their --

Paul D. Clement: I don't think --

John G. Roberts, Jr.: -- or take allotments outside the reservation?

Paul D. Clement: I don't think that would have been a logical assumption, given the conception of the time, where I think Congress was thinking in the main that Tribal ownership or Indian ownership went with the reservation status. And I think, again, if you think of this as being a Surplus Land Act that simply opens the reservation up, a portion of it to settlement, then it makes perfect sense to say the Tribal members can take their allotments anywhere on the reservation. But if you think you've really drawn a new boundary to the reservation, then I think it's more than passing strange that you can take allotments to the west of it, or you can take allotment and the new boarder is smack dab through the middle of it.

That --

Anthony M. Kennedy: I don't understand the -- your answer to the Chief Justice's question.

An Indian who wanted to have an allotment off the reservation, and allotments were generally available, could take that allotment off the reservation if the Indian chose to do so, correct?

Paul D. Clement: No.

My position is no, they couldn't.

And they could take it west of the right-of-way, but I am saying that's how --

Anthony M. Kennedy: Allotments were only open to non-Indians?

Paul D. Clement: No, no.

Before any settlers, non-Indians, came in, the existing Tribal members were allowed to take their allotments.

Anthony M. Kennedy: All right.

Paul D. Clement: And they were allowed to take their allotments anywhere on the preexisting reservation.

Anthony M. Kennedy: All right.

So we're not talking about allotments open to the general population?

Paul D. Clement: No.

No.

Anthony M. Kennedy: Thank you.

Paul D. Clement: And -- and this is clear from the proviso in Section 8.

It's the allotment only for members of the Tribe.

And they can take, consistent with the historical understanding, an allotment anywhere on the reservation, including west of the right-of-way. And that seems to me to be very consistent with the idea that the right-of-way is an interesting thing that the Tribe granted through their reservation, but it's not some new boundary.

And I think the subsequent history really supports that as well.

Ruth Bader Ginsburg: What do you mean --

Paul D. Clement: I mean, my friend on the other side --

Ruth Bader Ginsburg: But what do you mean, Mr. Clement, of the language that I read from Solem itself which seems to fit this case?

Paul D. Clement: Well, I take that language, Justice Ginsburg, as Justice Marshal writing for the Court saying that when you're in the third factor, when you witness de facto immunity -- I'm sorry -- de facto sort of diminishment, that that may ultimately support a conclusion that there was in fact diminishment as a matter of law. I don't take him to be opening up an entirely different route to finding immunity -- diminishment, rather, that doesn't go through an act of Congress.

And I think that's the only way to read the opinion as a whole because when the Court starts the opinion, it says the very first principle in this area is that only Congress can diminish a reservation. And it's perfectly compatible with that to say that when we get to the third factor and we're looking at all sorts of things, we'll look at settlement patterns as part of that.

But I don't think it's consistent with that world view to then say that, actually, the third factor is a standalone alternative route to find diminishment, not by congressional action, but by market reaction to a surplus land Act.

Antonin Scalia: Did -- did -- did we cite Solem in Sherrill? I -- I don't really recall.

Paul D. Clement: I -- I -- I don't recall. I --

Antonin Scalia: If it held that, it would have been -- it would have been cited and Sherrill would not have been any big deal.

Paul D. Clement: Well, I -- I -- I think that --

Antonin Scalia: I thought Sherrill was a big deal.

Paul D. Clement: Well, I think -- I think --

Antonin Scalia: Justice Ginsburg wrote it. I think she thought it was a big deal. (Laughter.)

Paul D. Clement: I'm not here to tell you it's not a big deal.

I am telling -- I'm here to tell you two things, though. One is that Solem went out of its way to not decide the diminishment issue.

So it is clearly an alternative way of thinking about the cases, and I don't think they're coextensive.

Which is to say, I think there could be a particular assertion of Tribal authority that you might say violates City of Sherrill principles, even within an undiminished reservation. And I do think it's then critically important that -- my friend on the other side has not raised this argument below.

I certainly did not understand it to be an independent argument in this Court.

It's all well and good to cite the case, but that doesn't make it an independent argument. Even his amici, who thought that they wanted to bring before this Court the City of Sherrill argument, admitted that the Petitioners hadn't made a City of Sherrill argument.

John G. Roberts, Jr.: But -- but Solem did talk about de facto diminishment.

And it seems to me that you've got to recognize when they do that, they're talking about something other than de jure, in other words, pursuant to the law.

It's pursuant to the facts on the ground.

Paul D. Clement: I understand, Mr. Chief Justice, but I think there's two ways to talk about de facto v. de jure.

One way to talk about it is that they're two totally alternative routes.

Another way is to say de facto diminishment means the settlement patterns, and that's something that can inform the ultimate conclusion of whether there's diminishment. And I really think the Court in Solem was using it in that passage in the latter respect.

And I think that's the only way to make sense of the case as a whole, because --

Ruth Bader Ginsburg: Except that it's -- it's presented before the Court turns to apply the principles.

Paul D. Clement: Exactly.

That's right.

It's part of the general principles of the Court --

Ruth Bader Ginsburg: It's -- it's not -- it's not tied to the third factor.

Paul D. Clement: Well, I -- I -- I take, though, that it actually is, in my view, tied to the third factor.

I think Justice Marshall was laying out all of the factors, starting with the first and governing principle, being that only Congress can diminish.

And he winds up the sort of general principle section with this last thing about de facto/de jure -- de facto diminishment, and then that ties up exactly to his discussion of settlement patterns in the third factor of Solem.

And I really think that's the right way to read that opinion. I would like to make one other very important point here, though, is I think the Court should understand that if you were to rule in favor of Petitioners in this case, the parties would essentially have to go back and reconstruct the right-of-way because the railroad is no longer there.

There's no Rails-For-Trails program in Thurston County.

So if you take a Google map and look at this area, you can't even tell where the right-of-way was. Now, I think that's significant, because if there really was a contemporaneous understanding in the 1950s and 1960s, when the railroad literally pulled up its tracks and left, that the right-of-way was the boundary of the reservation, then I think there would have been some effort to sort of preserve that jurisdictional boundary.

Anthony M. Kennedy: Well -- well -- well, please correct me if I'm wrong from the record.

My -- my understanding was in the west portion, the Tribe had done -- had exercised no jurisdiction until the Beverage Control Ordinance recently, but on the east portion, that they had.

But then you say, well, we can't tell the difference in east and west.

Paul D. Clement: Well, I -- I -- I --

Anthony M. Kennedy: And I mean, is -- is that reading of the record mistaken?

Paul D. Clement: Well, I -- I think what there is is a practical understanding -- as Justice Sotomayor indicated, this is not a wealthy Tribe that's looking to assert jurisdictions in places that are impractical.

So it's made a judgment that most of its efforts are directed at the eastern portion of the reservation. But what I'm saying is --

Anthony M. Kennedy: What -- what -- but does the fact that nothing, if -- if the record is correct -- let's assume the record shows that the Tribe exercised no jurisdiction over the western portion until this alcoholic Beverage Control Ordinance.

Is that relevant to the case at all?

Paul D. Clement: I don't think it's dispositive.

I think, yes, it's --

Anthony M. Kennedy: Is it relevant?

Paul D. Clement: Yes, relevant.

Anthony M. Kennedy: Why is it -- why is it relevant? To what point?

Paul D. Clement: It -- it -- I think it could be relevant to the third factor of Solem in a case where the situation was very cloudy. But one of the things also to keep in mind is that even before Montana, the authority that a Tribe would have over a principal non-Indian settlement on a reservation is fairly limited.

And if you're --

Ruth Bader Ginsburg: Limited to what?

Paul D. Clement: What's that?

Ruth Bader Ginsburg: What -- what -- what does it state beside the alcohol tax -- sales tax? What else, on your theory, could the Tribe do in the way of governance in this area?

Paul D. Clement: I think as a practical matter, Justice Ginsburg, there's two other things that are at stake here, and they both go to the equities of the Indians on the reservation, not the non-Indians, because the non-Indians on the reservation, the Tribal authority is very, very limited. So one thing that is at issue here is the potential to continue the revenue-sharing agreement with the State.

And this is something that the State actually came to the Tribe about.

And the theory of the revenue-sharing agreement for the fuel taxes is that there are going to be transactions in the western portion of the reservation where it's actually Tribal members that are buying gasoline over there, which does happen, because there are a lot of gas stations over there.

And of course, the Tribe would have authority to tax the Tribal members on the reservations for those -- those transactions.

So what --

Anthony M. Kennedy: You -- you -- Justice Ginsburg asked you a question, you said, as a practical matter.

I thought -- maybe I misinterpreted her question here -- as a legal matter.

As a legal matter, if you prevail, can the Tribe cast any doubt on the authority and the jurisdiction of the existing municipality?

Paul D. Clement: No, not at all.

What they can do is they can make cooperative agreements with the State of Nebraska to tax Indians when they make purchases in Pender. And the other thing they can do is that, when two Tribal members get in a scuffle in the village of Pender, the Tribal authorities can be contacted, and that matter can be handled in the Tribal courts --

Samuel A. Alito, Jr.: If the City of --

Paul D. Clement: -- rather than the State court.

Samuel A. Alito, Jr.: If the City of Pender is on a reservation, under what authority could the Town of Pender regulate things that go on in Pender?

Paul D. Clement: Under -- under its authority -- first of all -- I -- I mean, you know, let me say two things: One is: I'm not even sure, because of the retrocession under -- after Public Law 280, it's not even clear to me that Nebraska ceded its civil jurisdiction that it enjoyed under 280.

The -- the retrocession, as I understand it, was criminal retrocession with the exception of the motor vehicle laws. The second thing: As a practical matter, I think this is very important to understand.

The next town east from Pender is the Town of Walthill.

It is unambiguously in the reservation boundaries.

It is an incorporated municipality of the -- of sort of civil government of Nebraska. In the Winnebago reservation --

Samuel A. Alito, Jr.: Well, just educate me because I -- I don't know the law on this point.

Can -- excuse me. Can a State incorporate municipalities within the boundary of a Indian Reservation?

Paul D. Clement: Yes.

It can, and it does, and it's quite common.

And what this Court -- in fact, this Court in -- in -- in the Seymour case, one of its earliest diminishment cases, confronted a Federal township, Omak, Washington, that had always been a township.

There's civil authority there, but it's still on the reservation.

And that is actually quite common.

John G. Roberts, Jr.: Does that displace Tribal authority in that area?

Paul D. Clement: No.

Because again, remember, the Tribal authority over the non-Indians is so small.

John G. Roberts, Jr.: Well, the -- the -- we're talking about the area. Can Tribal -- Tribal police patrol within the municipality?

Paul D. Clement: I think they probably could. The only, really -- with an eye towards seeing if there were Indians there who were, you know, needing patrolling.

And there's some evidence in the record -- this is at Joint Appendix 371 and 372 -- that there were occasional patrols of the Tribe into Pender.

There's also a footnote in that same section that says that as a practical matter, when a Tribal member was apprehended in the Village of Pender, the police officer would call over to the Tribal authorities and have them take over the person.

John G. Roberts, Jr.: So there's overlapping jurisdiction? The municipality and the Tribe --

Paul D. Clement: Yes.

John G. Roberts, Jr.: -- within the city?

Paul D. Clement: Within the city.

And one other aspect --

John G. Roberts, Jr.: Doesn't that create conflict?

Paul D. Clement: No.

It really hasn't created significant conflict.

And what eliminates the conflict is your Montana decision which substantially limits the Tribe's authority over the non- --

Ruth Bader Ginsburg: But the -- the liquor tax that we're talking about is not imposed only on Indians, right? It's imposed on everybody who buys liquor in Pender.

Paul D. Clement: It -- it is, but that is the exception that proves the rule, because alcohol on reservations has been a unique Federal authority for as long as there's been Indian Reservations.

In fact, this Court had a case in 1911 arising out of the Omaha reservation where it reaffirmed the Federal authority.

Anthony M. Kennedy: So on Indian Reservation lands, I take it Tribal police have jurisdiction over non-Indians as to minor offenses?

Paul D. Clement: I -- I don't think that's actually true on the ground in Nebraska, at least as to the highways.

Because when they retroceded authority in 1970 --

Anthony M. Kennedy: Well, you -- you have the example of a scuffle.

Suppose an Indian and a non-Indian are in a scuffle.

If -- if there's a -- a minor criminal statute making this a minor offense, does the Tribe have jurisdiction over the non-Indian?

Paul D. Clement: I -- I don't think that it would within the Village of Pender.

And I think that is a reflection of the very limited authority that the Tribe has over non-Indians --

Anthony M. Kennedy: And that's true with reference to all Indian tribes? Can you cite me any proposition for that?

Paul D. Clement: Well, ultimately, it might be -- it might turn on the scope of the Montana decision.

And obviously, this Court has the Dollar General decision in front of it.

I want to make one more point, if I could, about the overlapping authorities here, cause the other authority here is Thurston County, if I just finish this one point. Pender is the County seat of Thurston County.

Thurston County has -- by State statute since 1922, it's western boundary has been defined as coextensive with the reservation, and there are Tribal members who's one of the council on the county, is a Tribal member.

Thank you, Your Honor.

John G. Roberts, Jr.: Thank you, counsel. Mr. Kedem.

Allon Kedem: Mr. Chief Justice, and may it please the Court: In Solem v. Bartlett, this Court explained that once a block of land is set aside as a Indian Reservation and no matter what happens to the title of individual plots within the area, the entire block retains its reservation status until Congress explicitly indicates otherwise.

It has not done so here. I'd like to start, if I may, with the question: What would change if this Court were to rule that the reservation is still intact? First of all, with respect to services, States can provide services to members of tribes and nonmembers alike anywhere within the reservation.

And the State of Nebraska provides services not only in the disputed area but on the east side as well. Let me give you a very specific example. There's a town called Bancroft, which is split in half by the right-of-way.

There's another town called Rosalie, which is clearly within the eastern undisputed part of the reservation.

There's a school district called the Bancroft-Rosalie School District, which is administered under the auspices of the State of Nebraska.

And that is true notwithstanding the fact that much of the land is on the east side, and true notwithstanding the fact that many members -- many students who go to that school are members of the Tribe.

Ruth Bader Ginsburg: That's what -- what the State can do, but the State wouldn't be obliged to do that, wouldn't be obliged to provide schools?

Allon Kedem: I see no basis for the State to refuse to provide services to its own citizens, especially if they are not members of the Tribe.

John G. Roberts, Jr.: Well, it would be a question of sovereignty.

Allon Kedem: The State --

John G. Roberts, Jr.: This is -- this is the reservation.

That's your argument.

It's the reservation, and that's not the -- the State land, so we're going to spend our money for schools or whatever on the -- in the State, not on the reservation.

Allon Kedem: The State retains regulatory sovereignty to make laws with respect to its own citizens and nonmembers on a reservation.

That's true on the east side.

It's true on the west side. I think you also may be left with the impression, after my friend's argument, that the State would stop issuing environmental permits and all of a sudden the Tribe would start issuing them.

That is not correct.

First of all, the Environmental Protection Agency has been administering on the west side of the reservation, including providing permits for animal feed lots.

There's also a permit for wastewater --

John G. Roberts, Jr.: The Environmental Protection Agency, which -- the State or Federal?

Allon Kedem: Federal.

Federal. -- including a permit for a wastewater treatment facility, although I believe it discharges into Logon Creek on the east side; so it may not tell us all that much about the jurisdiction.

Anthony M. Kennedy: But our -- our questions have been, suppose that you prevail, what can the State do? And we say, oh, it's a practical matter.

Don't worry.

They won't do -- the Tribe won't do anything. The Tribe won't do anything.

What could the Tribe do?

Allon Kedem: What could the Tribe do?

Anthony M. Kennedy: Yes, to regulate nonTribal members.

Allon Kedem: So the things that the Tribe could do would be any express delegation of authority from Congress.

The only one that we've heard about is the alcohol ordinance.

Beyond that, the State and Tribe could go back --

Ruth Bader Ginsburg: We heard about the fuel -- the revenue sharing of the fuel.

Allon Kedem: That's right.

There was an agreement to share revenue fuel, although that was something that the State entered into voluntarily with the Tribe.

Beyond that, the Tribe would have to fall under one of the two Montana exceptions, which are, as this Court is aware of because of the Dollar General case, very limited.

John G. Roberts, Jr.: I suppose one reason the Tribe might -- might not provide services is because the area is 98-point-whatever percent nonTribal, right?

Allon Kedem: I think that's absolutely correct.

John G. Roberts, Jr.: So they would be -- any services would be for the -- how many? Nine -- nine Indians in the area or 15?

Allon Kedem: Pardon?

John G. Roberts, Jr.: How many non-Indians own land in the western part?

Allon Kedem: It's almost entirely non-Indian in the western part.

And for the --

Antonin Scalia: Couldn't the Tribe enact ordinances that govern the Indians in the -- in the western part?

Allon Kedem: They could, but if we're talking about the effect on nonmembers, they would have to fall under the one -- one of the two Montana exceptions.

Antonin Scalia: Okay.

But at least as to Tribal members in the west --

Allon Kedem: That's right.

Tribal members on the reservation --

Antonin Scalia: -- they would be subject to the Tribe's jurisdiction which they otherwise would not?

Allon Kedem: I think that that's accurate. If I could go to the City of Sherrill argument, which got brought up a lot today.

I think this case is extremely different from the City of Sherrill for a number of reasons, but let me give you two big ones. In the City of Sherrill, this Court held that principles of equity restrained the Tribe from trying to resurrect a claim of inherent sovereign immunity. In this case by contrast, first of all, we're not just talking about the Tribe's jurisdiction. We're talking about the jurisdiction of the United States as well. And second of all, we're not talking about a claim of inherent authority.

This is authority exercised pursuant to a Federal statute, 18 U.S.C. 1161. And it -- for that reason, principles of equity simply don't apply here. Moreover, in City of Sherrill --

Antonin Scalia: I don't understand that. Try -- try it again.

Allon Kedem: Sure.

Antonin Scalia: Principles of equity do not apply here?

Allon Kedem: They do not apply in the same way.

So in City of Sherrill the Court applied a latches-type reasoning.

But latches would not apply to prevent the exercise of authority under a Federal statute, an express delegation of authority under Federal law.

Antonin Scalia: Why not?

Allon Kedem: Because that's what the Court said, for instance, in the copyright decision that Justice Ginsburg recently wrote, which is that when you have background principles of equity, they are presumed not to be -- apply and be displaced when there is a substantive law that Congress passes to deal with the same issue.

John G. Roberts, Jr.: There's a law that authorized the imposition of these taxes in the western part of the reservation.

Allon Kedem: The law authorizes the exercise of this authority if there is a reservation and if the Tribe applies to the Department of the Interior, which has to approve the ordinance.

John G. Roberts, Jr.: Well, doesn't that beg the question? The question was whether or not this reservation has been diminished.

So it's not the reservation.

Allon Kedem: Well, that's the question with respect to the application of the statute.

But when we're talking about City of Sherrill, we're talking about background equitable principles.

And I'm simply making the point that those principles don't apply when you have an express congressional statute dealing with the same issue.

Sonia Sotomayor: If the City of Sherrill did apply --

Allon Kedem: Pardon?

Sonia Sotomayor: If the City of Sherrill did apply, hypothetically -- I'm not nay-saying all the differences you're pointing out -- would you lose?

Allon Kedem: No.

Because again --

Sonia Sotomayor: Explain why not.

Allon Kedem: -- we're not talking about just what the Tribe can do.

We're also talking about the jurisdiction of the United States as well.

And there's certainly nothing in the City of Sherrill which suggests that the jurisdiction of the United States pursuant to a congressional creation of a reservation can be curtailed by the Tribe's failure to exercise authority in the disputed area.

Antonin Scalia: Frankly, I'm more -- I'm more inclined to vote your way if the City of Sherrill does apply than if the City of Sherrill doesn't apply. What you're telling me is, unless you get there through Solem, it doesn't matter whether the State and non-Indians have for generations viewed this land as their own.

That's what you're telling me, right?

Allon Kedem: Well, I'm telling you that to the extent City of Sherrill applies, it applies to a very different question, not the question as to where the borders of the reservation are.

It applies to the question what can the Tribe as a basis of its inherent sovereignty do? Now, it might under different circumstances if the Tribe tried to repurchase a bunch of land --

Antonin Scalia: That's not what city -- that's not what Sherrill said.

Sherrill said the Tribe had no jurisdiction.

It said it had no sovereignty over the area anymore.

Allon Kedem: Again, the diminishment question goes not just to the Tribe's sovereignty but the jurisdiction as well of the United States. And if we're talking about expectations, another point that I would make is that the single best evidence of what these parties could have expected is the retrocession, because that was a unique moment in which the State of Nebraska and the United States talked directly and officially to one another about the burdens and responsibilities for exercising jurisdiction in the reservation.

And the United States in the Federal register as official can be said the entire reservation remains intact. And the State of Nebraska, as we point out in our brief, had exactly the same understanding.

The assistant attorney general for Nebraska came and testified before Congress that all of Thurston County is within the Winnebago and within the Omaha Reservation.

Antonin Scalia: That determines the meaning of the 1882 statute.

Allon Kedem: Not in the least.

It goes to --

Antonin Scalia: That's what I think.

Allon Kedem: I was simply responding to the point that the expectations here might be all in the same direction. I would also point to 30 years of Nebraska revenue rulings, all of which say, point blank, Pender is still part of the reservation.

I would also point to the definition of Thurston County. As my friend pointed out, Pender is the county seat.

I think it's implausible to know that the -- to assert that the State of Nebraska wouldn't know that its own law specifies that all of Thurston County is within the reservations of the Omaha and the Winnebagos. I would also like to address, if I could, the tipping point theory that I think emerges from Petitioner's reply brief, and that's the idea that in 1872, Congress tried but failed to diminish the reservation because there were only about 300 acres sold.

But in 1882, it succeeded because a lot more land was sold.

I think there are a lot of problems with this theory. First of all, if that was what Congress had in mind, presumably it would have specified some way to know when the tipping point had been reached: Some percentage of land sales, some other measure of success. There's nothing about that in the text.

There's nothing about that in the legislative history. Second of all, the concept that Congress could attempt but fail to diminish a reservation, as my friend said that it did in 1872, is a concept that is wholly foreign to this Court's jurisprudence, which makes clear that Congress has plenary power. And finally, I think this Court should be very reluctant to assume that Congress implicitly transferred any part of its authority to change the borders of an Indian reservation to private parties and made it contingent on what this Court in Dakota referred to as uncertain future sales.

John G. Roberts, Jr.: Well, is that saying there's no such thing as de facto diminishment?

Allon Kedem: I think that de facto diminishment, if you think of it as some sort of freestanding alternative path to change the boundaries of a reservation, I do agree that it doesn't exist. But if you're talking about it --

John G. Roberts, Jr.: How is that consistent with the language in Solem that Justice Ginsburg read?

Allon Kedem: I -- I think it's a little bit hard to know exactly what the court meant. This Court has never found de facto diminishment.

All seven of its surplus land cases were decided on the basis of congressional intent.

And then there were sometimes a few sentences thrown in about how the status quo wouldn't change very much. I want to leave you with one more point.

Antonin Scalia: What about Sherrill?

Allon Kedem: Pardon?

Antonin Scalia: What about Sherrill?

Allon Kedem: Sherrill is very explicit, but it is not a diminishment ruling.

There's a footnote in City of Sherrill which makes very clear that it is not deciding the diminishment issue or the jurisdiction of the United States.

John G. Roberts, Jr.: What's -- what's vague about the language where non-Indian settlers flooded into the opening portion of a reservation and the area has long since lost its Indian character, we have acknowledged that de facto, if not de jure diminishment may have occurred.

Allon Kedem: I think you have to read that sentence in light of Yankton Sioux, which says that when you're talking about the subsequent treatment of the area and pattern of settlement, those are relevant only insofar as they bear on the touchstone of the inquiry, which is congressional intent. If I can make one final --

John G. Roberts, Jr.: Well, I think if you look at the passage, it goes on, then, to discuss in addition to that, then we look to subsequent demographic history as an additional clue as to what Congress meant. I -- I read those as the two different paragraphs as making two different points.

Allon Kedem: I think you could definitely read it that way if you just had Solem.

I think if you read Solem in light of Yankton Sioux, you reach a different result. If I could make one final point about unsettling expectations.

There are more than 300 Federally-recognized Indian reservations all throughout the United States.

The single most unsettling thing that this Court could do would be to suggest that the borders of those reservations depend not on what Congress said about them, but on shifting demographic patterns or who provides what services where. If there are no further questions.

John G. Roberts, Jr.: Thank you, counsel. Mr. Smith, you have four minutes remaining.

James D. Smith: Thank you, Your Honor. Where do I start? Let's start first with -- pointed out to me by co-counsel that a misstatement I made in response to Justice Kagan.

The Eighth Circuit briefs do cite Sherrill in support of the proposition for de facto diminishment.

My apology.

I hadn't argued at that point, but it is there in the Eighth Circuit. I would cite to the Joint Appendixes so the Court is aware exactly where it can find that undisputed, as far as the demographics, the jurisdictional history, JA 215 to JA 216, JA 318 to JA 319, JA 609 to JA 611. The -- the concept that, gee, nothing really big's going to change, having the Tribal police show up in their police vehicles patrolling the streets because it's on Tribal land is going to be a huge disruption of expectations. My background is in criminal law.

I know if you have a crime you're investigating, you don't know -- not all crimes, you know, there's not a sign saying gee, this was committed by an Indian; this was committed by a non-Indian.

You have a lot of who-done-its in which the question is who's supposed to investigate, and you have this overlapping jurisdiction where law enforcement itself is confused as to who's supposed to be investigating when they don't even know, maybe, who the perpetrator is. The idea that a Tribal member of a State governmental authority is somehow shows --

Antonin Scalia: Excuse me.

Wouldn't -- wouldn't the latter be the case with respect to any municipality that's within a reservation? We've been told there are a lot of those.

And -- and wouldn't that -- wouldn't that be a problem in all of those, being that you have overlapping jurisdiction of Tribal police and municipal police? And until you know who the perpetrator is, you don't know which one has jurisdiction.

James D. Smith: It's a problem if you know, and chose to live on an Indian reservation.

It -- it -- I mean, that exists. What's different in this case is the history is 130 years of people who believe and chose.

And they are not living on an Indian reservation; they are living in the State of Nebraska.

I call the State patrol.

The Tribal police are not patrolling up and down my street. That's the difference.

It's the justifiable expectations of the people who live there.

Stephen G. Breyer: Their point is, the government says, fine, make that argument.

Make it under the rubric City of Sherrill.

Maybe you make it when you go down on remand or something, but it is workable to divide the issue into two parts. The first issue is what's the reservation, and the second issue is what can you do on the reservation? When you get to question two, if the Tribe has made no assertion of jurisdiction, nobody even knows about it for 150 years.

Maybe it's basically unfair to let them do what they want to do.

And that depends on a lot of factors, such as what Congress says. So what do you think of that argument? Let's leave it for later.

Nobody's argued it.

James D. Smith: Glad I didn't answer what I thought of that argument. Your Honor, it is still -- invites the litigation over what is the extent of the power.

Who's got the power to govern? What is the extent of their power? Uncertainty, when you have expectations, you live in an area where the State governs you, and then to say we can go back and litigate all these issues is -- is just not what the public expects. The people in Pender, this is a big deal. They care about this.

They have expectations.

It's a big deal whether a Tribe -- Tribal Council has authority over us.

We don't get to vote for them.

Their Constitution doesn't even allow us to appear at their public meetings. The concept that somehow or other we can't find the right-of-way because it's not on Google is frankly silly.

It's very easy to go back, do surveys, find exactly where the right-of-way is.

John G. Roberts, Jr.: Thank you, counsel.

James D. Smith: Thank you, Your Honor.

John G. Roberts, Jr.: The case is submitted.