Opinion ID: 777929
Heading Depth: 4
Heading Rank: 2

Heading: Acting in a Commercial Capacity

Text: 21 American Vantage next argues that the casino, although not incorporated, should be treated as a corporation — and thus as a citizen — because it is acting like a corporation. Again, American Vantage cites no persuasive authority supporting its argument. 8 Two circuits have addressed similar arguments and rejected them. In Ninigret Dev. Corp. v. Narragansett Indian Wetuomuck Hous. Auth., 207 F.3d 21, 26-27 (1st Cir.2000), the First Circuit held that an unincorporated housing authority functioning as an arm of a tribe was not a citizen of any state for jurisdictional purposes even though it embarked upon a series of business transactions. Id. at 25. The Tenth Circuit in Gaines v. Ski Apache, 8 F.3d 726 (10th Cir.1993), addressed a negligence action against a tribe for an accident occurring at Ski Apache, the tribe's unincorporated, off-reservation ski resort. Rejecting the argument that the resort was subject to diversity jurisdiction because it was the functional equivalent of a corporation, id. at 728, the court observed that the Supreme Court has rejected attempts to treat entities in the nature of corporations as corporations for purposes of diversity jurisdiction. Id. at 730 (citing United Steelworkers of Am. v. R.H. Bouligny, Inc., 382 U.S. 145, 149-51, 86 S.Ct. 272, 15 L.Ed.2d 217 (1965)). 9 [T]he relevant question for purposes of diversity jurisdiction is whether Ski Apache has been incorporated ..., not whether it is an [economic] enterprise of the tribe. Id. 22 The Supreme Court's decision in Kiowa Tribe v. Manufacturing Technologies, Inc., 523 U.S. 751, 118 S.Ct. 1700, 140 L.Ed.2d 981 (1998), buttresses the reasoning of the First and Tenth Circuits. There, a payee brought suit to recover on a promissory note executed by an Indian tribe, and the tribe moved to dismiss based on sovereign immunity. The payee argued that the tribe should be prevented from taking advantage of immunity from suit because the note was related to commercial activities. Conceding that it might be unfair to unsuspecting tort victims and business partners to permit a tribe to engage in commercial activities while retaining sovereign immunity, id. at 758, 118 S.Ct. 1700, the Court nonetheless held that a tribe is not stripped of sovereign immunity merely because it engages in commercial activities. Id. at 760, 118 S.Ct. 1700. That reasoning applies with equal force here. A tribe does not shed immunity merely by embarking on a commercial enterprise. Neither does it shed noncitizenship, which, like immunity from suit, finds its genesis in tribal sovereignty. 23 In further support of its contention that the casino should be deemed a corporation notwithstanding its formally unincorporated status, American Vantage points to the example of political subdivisions of states. American Vantage cites Moor v. County of Alameda, 411 U.S. 693, 721, 93 S.Ct. 1785, 36 L.Ed.2d 596 (1973), in which the Court held that a California county ha[d] a sufficiently ... corporate character to dictate that it be treated as a citizen of California for diversity purposes. 411 U.S. at 721, 93 S.Ct. 1785. The Court affirmed its prior rule that a political subdivision of a State, unless it is simply the arm or alter ego of the State, is a citizen of the State for diversity purposes. Id. at 717, 93 S.Ct. 1785 (internal quotation marks and footnote omitted). But Moor does not establish as a general principle that any independent self-governing entity should be treated as a citizen for purposes of diversity jurisdiction. Gaines, 8 F.3d at 730. Tribes are not analogous to political subdivisions of states. Unlike political subdivisions, tribes are themselves sovereign and do not derive their power from the state. See Canby, supra, at 71 ([A] tribe is quite unlike a city or other subdivision of a state.... A tribe ... is its own source of power.).