Opinion ID: 216352
Heading Depth: 5
Heading Rank: 1

Heading: Applicability of Milhelm Attea

Text: Initially, we reiterate that the main features of the amended tax law's probable demand and allocation mechanisms are substantially similar to those of the 1988 version upheld against a preemption challenge in Milhelm Attea. Like the 1988 version, the amended tax law limits the tax-free cigarettes that wholesalers may sell according to each tribe's probable demand. New York's legitimate interest in avoiding tax evasion by non-Indian consumers justifies these probable demand limitations. See Milhelm Attea, 512 U.S. at 75, 114 S.Ct. 2028. Further, like in the 1988 version, through the alternative coupon and prior approval systems, the State meets its obligation to make available to tribal members a tax-free quantity of cigarettes sufficient to satisfy the legitimate demands of those reservation Indians who smoke[.] Id. at 69, 114 S.Ct. 2028. Thus, under the reasoning of Milhelm Attea, the main features of the amended tax law's quota and allocation mechanisms, as written, do not unduly burden tribal retailers or infringe tribal self-government. In an effort to distinguish Milhelm Attea, Plaintiffs argue that its rationale applies only to preemption challenges, whereas the present dispute concerns tribal sovereignty. They note that Milhelm Attea expressly declined to assess for all purposes each feature of New York's tax enforcement scheme that might affect tribal self-government or federal authority over Indian affairs. Id. at 69, 114 S.Ct. 2028. Contrary to Plaintiffs' argument, Milhelm Attea's reasoning is applicable here because federal preemption over the regulation of Indian tribes is closely related to federal recognition and protection of tribal sovereignty. Preemption and tribal sovereignty are two independent but related barriers to the assertion of state regulatory authority over tribal reservations and members. Bracker, 448 U.S. at 142, 100 S.Ct. 2578. [P]rinciples of federal Indian law, whether stated in terms of preemption, tribal self-government, or otherwise, Colville, 447 U.S. at 155, 100 S.Ct. 2069, ultimately measure the scope of a state's regulatory authority through a particularized inquiry into the nature of the state, federal, and tribal interests at stake, Bracker, 448 U.S. at 145, 100 S.Ct. 2578. Indeed, Milhelm Attea's reasoning demonstrates the relationship between the preemption and tribal sovereignty analyses within federal Indian law. The Court stated that [a]lthough Moe and Colville dealt most directly with claims of interference with tribal sovereignty, the reasoning of those decisions requires rejection of the submission that 25 U.S.C. § 261 bars any and all state-imposed burdens on Indian traders. Milhelm Attea, 512 U.S. at 74, 114 S.Ct. 2028. Accordingly, Milhelm Attea's analysis is relevant to the issues in this appeal, and to the extent the general features of the amended tax law's quota and allocation schemes mirror those in the 1988 version, Milhelm Attea undermines the likelihood of Plaintiffs' success on this pre-enforcement challenge to the amended tax law's validity.