Opinion ID: 3052743
Heading Depth: 2
Heading Rank: 1

Heading: Claim against the Housing Authority

Text: Plaintiffs allege that the Blackfeet Housing Authority breached the covenants of habitability, merchantability, and good faith and fair dealing by selling defective homes to Plaintiffs. We decline to reach the merits of this contract claim because Plaintiffs first must exhaust their tribal court remedies. [1] Principles of comity require federal courts to dismiss or to abstain from deciding claims over which tribal court jurisdiction is “colorable,” provided that there is no evidence of bad faith or harassment. Atwood, 513 F.3d at 948. Exhaustion of tribal remedies is “mandatory.” Burlington N. R.R. Co. v. Crow Tribal Council, 940 F.2d 1239, 1245 (9th Cir. 1991). The parties failed to raise this issue until after we issued our opinion. Nevertheless, “[a] district court has no discretion to relieve a litigant from the duty to exhaust tribal remedies prior to proceeding in federal court.” Allstate Indem. Co. v. Stump, 191 F.3d 1071, 1073 (9th Cir.), amended, 197 F.3d 1031 (9th Cir. 1999). Although Plaintiffs’ contract claim has not yet been brought in tribal court, “[t]he absence of any ongoing litigation over the same matter in tribal courts does not defeat the tribal exhaustion requirement.” Sharber v. Spirit Mountain Gaming Inc., 343 F.3d 974, 976 (9th Cir. 2003) (per curiam); see also United States v. Plainbull, 957 F.2d 724, 728 (9th Cir. 1992) (holding that exhaustion of tribal remedies is “required even in the absence of a pending tribal court action”). [2] Tribal court jurisdiction over the contract disputes here is unquestionably colorable: Plaintiffs are tribal members, Defendant Blackfeet Housing Authority is a tribal entity, and 11402 MARCEAU v. BLACKFEET HOUSING AUTH. at least some key events—construction of the homes, for instance—occurred on tribal lands. See Stock W. Corp. v. Taylor, 964 F.2d 912, 919 (9th Cir. 1992) (en banc) (holding that tribal court jurisdiction was colorable where a non-tribe member sued a tribe in a contract and tort dispute and the key events may have taken place on tribal lands). Because there is no evidence of bad faith or harassment, we hold that Plaintiffs must exhaust their tribal court remedies. Accordingly, we remand the case. Because of the lengthy course of this litigation, the district court should stay, rather than dismiss, the action against the Housing Authority while Plaintiffs exhaust their tribal court remedies. See Allstate Indem. Co., 191 F.3d at 1076 (remanding with instructions to stay action while party exhausted tribal court remedies). Cf. Atwood, 513 F.3d at 948 (approving a district court’s discretionary decision to dismiss a domestic relations action when tribal court proceedings were pending). [3] In our earlier opinions, we declined to require Plaintiffs to exhaust their tribal court remedies. Instead, we held that the Blackfeet Tribe had waived tribal immunity through the enabling ordinance that established the Housing Authority. Marceau II, 519 F.3d at 842-44; Marceau I, 455 F.3d at 97883; see also Kiowa Tribe of Okla. v. Mfg. Techs., Inc., 523 U.S. 751, 754 (1998) (noting that “an Indian tribe is subject to suit only where Congress has authorized the suit or the tribe has waived its immunity”). Our doing so was in error, and we now vacate that holding and decline to reach the issue. Whether or not the Tribe waived tribal immunity, the tribal court must have the first opportunity to address all issues within its jurisdiction, including that one.