Court Opinion

ID: 9673055
Source: CourtListenerOpinion
Date Created: 2023-08-24 04:05:25.95885+00
Date Added: 2024-06-11T18:16:19.996101
License: Public Domain

KEITH, Chief Justice,
dissenting in part.
I respectfully dissent. While I agree with the majority that state courts have concurrent jurisdiction with tribal courts in lawsuits of this type, I disagree with the majority’s conclusion that for-profit, multi-million dollar private tribal businesses like Little Six, Inc. (LSI) may rely upon the same sovereign immunity defense to which the tribe itself is entitled. As the majority frames the issue, the question is whether LSI is a tribal entity “analogous to a governmental agency” which should benefit from the sovereign immunity defense, or whether LSI is in fact a “commercial business enterprise, instituted solely for the purpose of generating profits for its private owner.” It seems to me that LSI clearly fits the latter definition. Accordingly, I would reverse the decision of the court of appeals and permit Gavie to pursue her various claims against LSI in state court.
The result of the majority’s decision in this case is to grant total immunity from suit to a complex, for-profit corporate entity with hundreds of employees which transacts business both inside and outside Indian country. By extending the sovereign immunity defense to include LSI, the majority ignores the historical purpose of the sovereign immunity doctrine in this country as applied to Indian tribes, which is to grant special independent sovereign status to Indian tribes and their governmental bodies. In no way does LSI conform to the ordinary conception of a nonprofit, governmental entity entrusted with promoting the welfare of its citizens: clearly, LSI is first and foremost a corporation engaged in a for-profit business venture for the purely financial benefit of its shareholders.
The majority cites several factors which other courts have relied upon to answer the “important, complex and unresolved question” of whether tribal sovereign immunity protects commercial activities. -Selecting just three of these factors, the majority then reaches the conclusion that LSI is entitled to sovereign immunity in this ease. I disagree. First, the majority cites LSI’s own Articles of Incorporation as “evidence” of LSI’s intended purpose of “improving the business, *299financial or general welfare of the Corporation, Members of the Corporation, and the Community.” This language, however, could be found in the articles of incorporation of any for-profit corporation and certainly does not suggest that LSI was intended to benefit the Community in the same sense as a housing authority, educational fund, agricultural cooperative or other extension of the tribal government intended solely to promote the tribe’s well-being. Instead, it is clear from the trial court record that LSI’s primary purpose is to generate profits for its shareholders (ie., the tribe’s members) without any restrictions whatsoever on the use of the funds from the casino. I do not mean to suggest that generating profits for the tribe’s members is an improper or unethical objective, but merely point out that a corporation like LSI should not receive the same protections as tribal businesses whose funds are directed towards general improvements for the community as a whole, such as education, environmental protection, health care or job opportunities.1
Second, the majority is persuaded by the fact that LSI’s single share of stock is owned by the Community as a whole, and that its Board of Directors must include a majority of Community members. However, this does not change the fact that LSI is a private corporation, registered to transact business in the State of Minnesota like any other private business, and certainly not an extension of the tribal government per se. Furthermore, LSI was not incorporated under Section 17 of the Indian Reorganization Act, which extends sovereign immunity to corporations formed by tribal governments to further the tribe’s economic interests. See 25 U.S.C. §§ 476, 477 (1994). The tribal government is not involved in the day-to-day operations of LSI’s business ventures, does not select or supervise the board of directors, nor is tribal property threatened by judgments against the corporation. As the court of appeals found, LSI “was created as a separate economic entity, not subject to governmental control, incorporated under tribal law and not merely as an authorized tribal activity.” Gavle v. Little Six, Inc., 534 N.W.2d 280,284 (Minn.App.1995).
And finally, the majority claims that extending sovereign immunity to LSI will follow federal policy encouraging the tribe’s autonomy and general welfare. However, denying sovereign immunity to LSI, a corporation whose primary responsibilities consist of running a casino, would not infringe upon the federal government’s laudable goals of cultural preservation, conservation of natural resources owned by the tribe, or promotion of tribal self-government. The assets of the Community would not be jeopardized by court judgments against LSI, and in fact there is a persuasive argument that extending sovereign immunity to corporations like LSI could be potentially detrimental to the tribe’s business interests. As the Arizona Supreme Court noted in Dixon v. Picopa Construction Co., 160 Ariz. 251, 259, 772 P.2d 1104, 1112 (Ariz.1989), “an Indian corporation’s successful assertion of immunity, even in a negligence case, may deter persons or entities from entering into contractual relationships with that Indian corporation or any other Indian corporation. Non-Indians will undoubtedly think long and hard before entering into business relationships with Indian corporations that are immune from suit.”
I find substantial similarities between the facts at issue in this case and those considered by the Arizona court in Dixon. In that case, the court held that a construction company incorporated by an Indian tribe was not a “subordinate economic organization,” and therefore was not entitled to assert the tribe’s sovereign immunity defense in a tort *300action brought by an automobile driver following an off-reservation automobile accident. Id., 160 Ariz. at 255-57, 772 P.2d at 1108-10 (citing White Mountain Apache Indian Tribe v. Shelley, 107 Ariz. 4, 480 P.2d 654 (Ariz.1971)). Like LSI, the Picopa Construction Company involved in the Dixon case had a board of directors separate from the tribal government and with exclusive administrative control of the corporation’s day-to-day operations, was instituted as a for-profit business venture with the Community as the sole shareholder, was not organized under Section 17 of the Indian Reorganization Act, and was not intended to carry out the Community’s governmental functions. Id. at 254-58, 772 P.2d at 1107-11. I would follow the Arizona court’s reasoning in Dixon and Shelley, and require that a business incorporated under tribal law show itself to be an extension of the tribal government in order to take advantage of the tribe’s sovereign immunity defense. In this case, it is clear that LSI does not meet this test. In conclusion, I believe that Gavie should be permitted to pursue her claims against LSI in state court because LSI is not an economic organization subordinate to the tribal government.

. See, e.g., Ransom v. St. Regis Mohawk Educ. & Community Fund, Inc., 86 N.Y.2d 553, 658 N.E.2d 989, 635 N.Y.S.2d 116 (N.Y.1995) (nonprofit tribal corporation organized to provide education and health services to tribe enjoyed tribe’s sovereign immunity); White Mountain Apache Indian Tribe v. Shelley, 107 Ariz. 4, 480 P.2d 654 (Ariz.1971) (tribal agency empowered with management of tribe’s timber resources was "subordinate economic organization” and therefore was immune from suit); S. Unique, Ltd. v. Gila River Pima-Maricopa Indian Community, 138 Ariz. 378, 674 P.2d 1376 (Ariz.Ct.App.1983) (agricultural venture created to promote economic welfare of Indian community and whose property was entirely owned by community was "subordinate economic organization” of tribal government and therefore entitled to tribal sovereign immunity).