Court Opinion

ID: 9758685
Source: CourtListenerOpinion
Date Created: 2023-08-28 23:40:11.951938+00
Date Added: 2024-06-11T07:28:53.900150
License: Public Domain

Justice COATS,
concurring in part and dissenting in part.
Although I also believe the district court erred in finding that tribal immunity cannot bar the state from judicially enforcing its investigative subpoenas, and I too would reject the eleven-factor arm-of-the-tribe test devised by the court of appeals, I find the majority's analysis no more satisfying or helpful. More fundamentally, I object to the majority's disregard for our own prior inter*1116pretations of United States Supreme Court sovereign immunity doctrine, in deference to those of various inferior federal tribunals. Finally, and of perhaps greatest significance for actual practice, I believe the majority's confused jurisdictional analysis leads it to an unjustifiable and in fact illogical allocation of burdens, making it virtually impossible for the state to protect its own citizens from even the most blatant acts of fraud.
The majority's lengthy paean to tribal sovereignty notwithstanding, the Supreme Court has told us little about the seope and nature of tribal immunity, other than designating it a matter of federal law subject only to congressional limitation. See Kiowa Tribe of Okla. v. Mfg. Techs., Inc., 523 U.S. 751, 459, 118 S.Ct. 1700, 140 L.Ed.2d 981 (1998). And unlike the immunity of foreign nations, with respect to which it has legislated freely, see Foreign Sovereign Immunities Act of 1976, Pub.L. No. 94-588, 90 Stat. 2891, Congress has yet to take a similarly active role in defining or regulating tribal immunity. Kiowa, 523 U.S. at 759, 118 S.Ct. 1700. Aside from a handful of Supreme Court pronouncements, arising largely from private disputes and state regulation of commercial activities, the incidents of tribal immunity, including the particular acts and actors to which it may apply, can be assessed only by extrapolation from general principles of sovereign immunity developed in other contexts.
There can be absolutely no question that Indian Tribes are separate "Nations," and as "sovereigns or quasi sovereigns," they enjoy immunity "from judicial attack." Kiowa Tribe, 523 U.S. at 757, 118 S.Ct. 1700 (quoting United States v. United States Fidelity & Guaranty Co., 309 U.S. 506, 512, 60 S.Ct. 653, 84 L.Ed. 894 (1940)). The Supreme Court has therefore held that absent consent or congressional authorization, the exercise of state judicial power over an Indian Tribe, just as the exercise of state judicial power over the United States government itself, is void. USF & G, 309 U.S. at 514, 60 S.Ct. 653. In the absence of congressional action, it has also steadfastly declined to narrow the applicability of the judicial doctrine of tribal sovereign immunity, either by excluding commercial activities altogether or by limiting tribal immunity for commercial activities to those conducted on reservations. Id. at 758, 60 S.Ct. 653; Okla. Tax Comm'n v. Citizen Band Potawatomi Indian Tribe of Okla., 498 U.S. 505, 510, 111 S.Ct. 905, 112 L.Ed.2d 1112 (1991). Beyond suits for injunctive relief or damages, it has even upheld a tribe's immunity from state-court demands for information about its enrolled members and reports on their fishing operations. See Puyallup Tribe, Inc. v. Wash. Dep't of Game, 433 U.S. 165, 172, 178, 97 S.Ct. 2616, 53 L.Ed.2d 667 (1977). Thus far, however, the Supreme Court has never extended tribal immunity to officers or entities facially dis-tinet from Indian Tribes themselves.1
In fact, the Court has drawn a distinction between state-court orders that involve relief against a tribe itself, which must be vacated, and suits to enjoin violations of state law by individual tribal members, which are permissible, Puyallup, 433 U.S. at 171-73, 97 S.Ct. 2616, making clear that tribal immunity does not immunize individual tribal members as such, even if they are officers of the tribe. Santa Clara Pueblo v. Martinez, 436 U.S. 49, 59, 98 S.Ct. 1670, 56 L.Ed.2d 106 (1978); Puyallup, 433 U.S. at 171, 97 S.Ct. 2616. Pointedly explaining why permitting a state to require Indian retailers to collect a state-imposed cigarette tax from nonmembers of the tribe would not amount to providing a right without a remedy, the Supreme Court *1117held in Potawatomi that "individual agents or officers of a tribe" remain liable for damages in actions brought by the State, despite their tribe's enjoyment of sovereign immunity. 498 U.S. at 514, 111 S.Ct. 905.
Sovereign immunity is generally held to extend to particular persons or entities named in a law suit only to the extent that the suit is, in effect, a suit against the sovereign. See Regents of the Univ. of Cal. v. Doe, 519 U.S. 425, 429, 117 S.Ct. 900, 137 L.Ed.2d 55 (1997) Pennhurst State School & Hosp. v. Halderman, 465 U.S. 89, 102, 104 S.Ct. 900, 79 L.Ed.2d 67 (1984); Middleton v. Hartman, 45 P.3d 721, 727 (Colo.2002). "The general rule is that a suit is against the sovereign if 'the judgment sought would expend itself on the public treasury or domain or interfere with the public administration,' or if the effect of the judgment would be 'to restrain the Government from acting, or to compel it to act'" - Pennhurst, 465 U.S. at 102 n. 11, 104 S.Ct. 900 (quoting Dugan v. Rank, 372 U.S. 609, 620, 83 S.Ct. 999, 10 L.Ed.2d 15 (1963)). It is this judicially promulgated body of sovereign immunity principles, rather than any congressional or Supreme Court treatment of Indian Tribes in particular, that has led to the widespread acceptance by both state and lower federal courts that tribal immunity, as a species of sovereign immunity generally, extends to state judicial orders that would operate, in fact even if not in name, against a sovereign tribe. Compare Allen v. Gold Country Casino, 464 F.3d 1044, 1047 (9th Cir.2006) (holding that a casino that "function{ed] as an arm of the Tribe" enjoyed tribal immunity), and Ramey Constr. Co. v. Apache Tribe of the Mescalero Reservation, 673 F.2d 315, 320 (10th Cir.1982) (holding that an inn which was "a sub-entity of the Tribe rather than a separate corporate entity" enjoyed tribal immunity), and Ninigret Dev. Corp. v. Narragansett Indian Wetuomuck Hous. Auth., 207 F.3d 21, 29 (1st Cir.2000) (holding that as an arm of a tribe, an entity enjoys the full extent of the tribe's sovereign immunity), and Hagen v. Sisseton-Wahpeton Cmty. Coll., 205 F.3d 1040, 1043 (8th Cir.2000) ("[The College serves as an arm of the tribe and not as a mere business and is thus entitled to tribal sovereign immunity."), with Samantar v. Yousuf, - U.S. -, 180 8.Ct. 2278, 2289-92, 176 L.Ed.2d 1047 (2010) (finding that in contradistinetion to general principles of sovereign immunity, FSIA extends foreign sovereign immunity only to statutorily defined agencies and instrumentalities and not to foreign officials at all).
These principles, including the proposition that an agent or entity facially distinct from a sovereign may nevertheless be entitled to sovereign immunity when it acts as an "arm" of the sovereign, have been developed by the Supreme Court largely in the context of the Eleventh Amendment.2 It is well settled that the Eleventh Amendment's reference to actions "against one of the United States" encompasses not only actions in which a state is actually named as a defendant but also certain actions against state agents and state instrumentalities. Doe, 519 U.S. at 429, 117 S.Ct. 900. And although it has emphasized that Indian Tribes have not consensually accepted the same limitations on their sovereignty as those accepted by the states in ratifying the federal constitution, see Blatchford v. Native Vill. of Noatak, 501 U.S. 775, 782, 111 S.Ct. 2578, 115 L.Ed.2d 686 (1991), the Court has never suggested an Eleventh Amendment limitation that might more severely restrict the class of facially distinct agents or entities to which a sovereign's immunity could extend.3
*1118With varying degrees of specificity, the federal courts upon which the majority relies have looked to their own arm-of-the-state jurisprudence to fashion an arm-of-the-tribe doctrine. While the Supreme Court's arm-of-the-state jurisprudence had clearly required a balancing of various factors, its reference to different factors in different cases and its failure to specify the relative importance of any particular factor, however, had led the federal civreuits to develop what we have previously described as a "diverse array" of arm-of-the-state balancing tests. See Simon v. State Comp. Ins. Auth., 946 P.2d 1298, 1303 (Colo.1997). With no different guidance from the Supreme Court concerning the immunity of tribal agents or instru-mentalities, the arm-of-the-tribe balancing tests of the federal cireuit courts have similarly lacked uniformity.
While this court has not until today had occasion to tailor an arm-of-the-sovereign inquiry specifically to tribal immunity, we have previously found it necessary to digest these balancing tests and identify what we consider to be the dominant factors in determining whether an entity acts an arm of the sovereign. See id. at 1805 (applying Eleventh Amendment immunity analysis to determine whether state-created entity is a person for purposes of 28 U.S.C. § 1988). In Simon we described the appropriate considerations as: 1) how state law characterizes the entity; 2) whether the entity is autonomous and free from the control of the state; and 3) whether the judgment against the entity would ultimately be paid by the state. Id. Although we there took into consideration the understanding of other state and federal courts, we declined to abdicate our responsibility to construe for ourselves the federal law to which the courts of this state would be subject.
The Supremacy Clause demands that state law yield to federal law, but neither federal supremacy nor any other principle of federal law requires that a state court's interpretation of federal law give way to a federal court's interpretation other than that of the United States Supreme Court. Hill v. Thomas, 973 P.2d 1246, 1255 (Colo.1999) (quoting Community Hosp. v. Fail, 969 P.2d 667, 672 (Colo.1998), and paraphrasing Lockhart v. Fretwell, 506 U.S. 364, 376, 113 S.Ct. 838, 122 L.Ed.2d 180 (1993) (Thomas, J., concurring)). This court's interpretation of federal law is no less authoritative than that of the Cireuit Court of Appeals for this federal circuit, much less the interpretations of other federal courts. See id. If we follow the interpretations of inferior federal tribunals, it is because we choose to do so and not because we must. Id.
While the majority declares various lower federal court cases to be persuasive, it offers no supporting explanation why this might be so, much less why they would be more persuasive than our own precedents. Without distinguishing or overruling our own prior interpretations of Supreme Court arm-of-the-sovereign doctrine, the majority simply fails to follow them. Perhaps even more objectionably, it openly criticizes the interpretation of federal law by state courts, fearing that it may be interpreted as an improper state-imposed limitation or diminution of federal rights. Unlike the majority, I consider our construction of federal law, until it has been overruled or modified by either this court or the United States Supreme Court, to be the binding precedent of the jurisdiction.4
Although the majority's three-factor test, for which it credits the federal courts of appeal, is strikingly similar to our three-part arm-of-the-state test, its disparate terminology and derivation leave it virtually unconnected to the established arm-of-the-sovereign jurisprudence of both this court and the Supreme Court. In sharp contrast, by rejecting the "diverse array" of federal circuit court arm-of-the-state balancing tests and *1119basing our own analysis in that context on first principles articulated by the United States Supreme Court, this court has already provided the framework for extending tribal sovereign immunity to facially distinct agents or entities. And by applying the Supreme Court's Eleventh Amendment arm-of-the-sovereign doctrine in specific factual settings, I believe we had already created relevant binding precedent for the jurisdiction, now derailed by the majority's freshly imported standard.
Apropos of these specific motions to dismiss, alleging merely that Cash Advance and Preferred Cash Loans are business names for entities that are licensed and regulated by, and incorporated under the laws of, sovereign Indian Tribes, this court has previously made clear that classification as an arm of a sovereign necessarily requires a balance of all three relevant factors. Being licensed or regulated by a sovereign is, in itself, clearly insufficient. Our arm-of-the-sovereign jurisprudence has therefore looked to the extent to which the sovereign exercises financial and administrative control over the entity as a means of assessing whether it is simply too autonomous and free of state control to actually function as the state. See Simon, 946 P.2d at 1308-09; Graham, 956 P.2d at 563-64. In that regard, we have found, for instance, that a sovereign's choice to characterize an entity as a body corporate or political subdivision, rather than an agency of the sovereign, actually militates against a determination that the entity is authorized to function as the sovereign and share its immunity. See Simon, 946 P.2d at 1305; cf. Graham, 956 P.2d at 563 (holding, however, that where special reasons existed for designating the University of Northern Colorado a body corporate, other grounds for finding it an arm of the state were more influential).
Although the majority professes caution, it actually throws caution to the winds and steams full speed ahead into uncharted waters. Not only does it coin a new arm-of-the-tribe doctrine, but after conceding that the issue has not been raised or briefed in this enforcement action against two commercial entities, the majority proceeds to opine on the extent to which tribal immunity should extend to officials of those entities. Even assuming that tribal officials, just as state officials, enjoy sovereign immunity in suits that are nominally against them but are in fact against their sovereign, no official of these commercial entities is currently the object of the state's investigative subpoenas or any court enforcement order in this case. In the unlikely event that on remand the district court finds Cash Advance and Preferred Cash Loans, the named commercial entities, to actually fall under a cloak of tribal immunity, and it nevertheless orders enforcement against their officers (despite not having been named as parties to the action), only then would this issue become ripe for resolution.
Conceptually faulty as I believe the majority's arm-of-the-tribe analysis to be, I fear the more serious negative consequences of today's opinion may lie in its allocation of burdens. The majority requires that before a state can exercise jurisdiction over an entity claiming to operate as an arm of a tribe, the state must disprove that claim. As a practical matter, this burden will be extremely difficult if not impossible for the state to ever meet. Because I believe the majority has failed to appreciate precisely what is at issue in an arm-of-the-sovereign determination, I believe it mis-analyzes the question of jurisdiction and therefore the allocation of burdens.
Although it is foreed by the federal cases upon which it relies to concede that a party's claim of tribal immunity does not actually present a question of subject-matter jurisdiction, the majority nevertheless finds it sufficiently similar to be treated as such. Unlike claims of governmental immunity in this state, which by statute must be resolved by a procedure similar to but without the jurisdictional limitations of C.R.C.P. 12(b)(1), see Finnie v. Jefferson County Sch. Dist. R-1, 79 P.3d 1253, 1255-60 (Colo.2003), neither Congress nor the Supreme Court has remotely suggested such a procedure for resolving claims of tribal immunity. In any event, however, the majority fails to appreciate that an arm-of-the-tribe defense does not question whether a sovereign Indian Tribe is immune from suit but only whether the party subject*1120ed to judicial enforcement is really an instrumentality of the tribe.
In the absence of a state judicial proceeding nominally seeking relief against an Indian Tribe, exercise of the state's judicial power over a named party is neither logically nor legally contingent upon tribal consent or the waiver of tribal immunity. Rather, it is incumbent upon any nominally distinct entity claiming the cloak of tribal immunity to initially establish that the state's suit against it actually seeks relief against an Indian Tribe on behalf of which it acts. The logical absurdity of requiring the state to prove that named commercial enterprises like Cash Advance and Preferred Cash Loans, with no apparent connection to Indian Tribes and only belated claims of one, are not acting on behalf of particular Indian Tribes should be obvious. For this reason, and because fairness generally mandates that the burden of proving issues lying peculiarly within the knowledge of one party should be borne by it, federal cireuit courts considering the question unanimously conclude that an entity asserting Eleventh Amendment immunity has the burden to demonstrate its entitlement. Woods v. Rondout Valley Cent. Sch. Dist. Bd. of Educ., 466 F.3d 282, 287 (2d Cir.2006). Not surprisingly, this procedural approach has been similarly applied to assertions of tribal immunity. E.g., New York v. Shinnecock Indian Nation, 523 F.Supp.2d 185, 297 n. 72 (E.D.N.Y.2007).
The majority of course recognizes the practical dilemma created by its jurisdictional analysis and attempts to avoid the problem of producing the necessary information, at least in this case, by finding that the "tribal entities" have already "voluntarily provided the state with some information relevant to the immunity determination" and have thereby waived any claim of immunity with regard not only to that information but to all information concerning "whether the tribal entities are arms of the tribe." Maj. op. at 1115. It is more than a little unclear to me how negotiated disclosures in the face of official process demanding production and threatening contempt can be characterized as a voluntary waiver of all information relevant to the immunity determination, but in any event, it is cold comfort for the state in future cases where the object of the state's investigative subpoenas can be virtually certain that it need not provide any information until the state has disproved its claim to be an arm of a tribe.5
While Indian Tribes are clearly independent sovereign powers entitled to immunity from enforcement actions by the state or federal courts, I believe the duty of state governments to protect vulnerable consumers from eriminally unserupulous predators, especially in the current technological environment, militates against the expansion of that immunity beyond existing mandates of federal law. We are here faced with an immediate appeal from the district court's denial of a motion to dismiss a special proceeding to enforce administrative subpoenas. Assuming that appeal was properly taken at this stage of the proceedings, I believe our duty would be more judiciously discharged simply by identifying the district court's clear error in finding tribal immunity inapplicable to state demands for information; by rejecting the expansive holding of the court of appeals; and by remanding for a determination whether the named commercial entities are arms of a sovereign according to our existing interpretations of United States Supreme Court doctrine. But for the majority's penchant for global solutions and the problems created by its own questionable choices, I see no need for the court to expound on such matters as the immunity of tribal officials, whether tribal immunity operates as a matter of jurisdiction or as an affirmative defense, or the requirements for waiver of tribal immunity, none of which *1121were addressed by the district court's order being appealed here.
Because I would also remand to the district court and reject the guidance of the court of appeals, but would reject the majority's guidance for proceedings on remand as well, I respectfully concur in part and dissent in part.

. To the extent the majority suggests otherwise, I cannot agree that the Supreme Court has even implicitly addressed the arm-ofthe-tribe question. See Maj. op. at 1109. The Supreme Court's only arm-of-the-tribe reference appears in the footnote cited by the majority, see Inyo County v. Paiute-Shoshone Indians, 538 U.S. 701, 705 n. 1, 123 S.Ct. 1887, 155 L.Ed.2d 933 (2003), and that footnote does no more than acknowledge the undisputed assertion of the Solicitor General, appearing as amicus curiae, that the Tribe's gaming corporation should be treated as an arm of the tribe, which would of course subject it to the Tribe's same inability to bring suit against the county. Because the Supreme Court disposed of the case by holding that a plaintiff could not simultaneously claim to be a "person," entitled to sue under 42 U.S.C. § 1983, and a "sovereign," whose immunity was violated by execution of the County's search warrant, the questions whether the Tribe's immunity was actually violated and whether the Tribe's gaming corporation shared that immunity were never at *1117issue in this section 1983 action and were never addressed.

. - While entities may be agencies or instrumental-ities of the federal government as well, disputes over their status have more typically involved the interpretation of "sue or be sued" language in their enabling legislation, see, e.g., FDIC v. Meyer, 510 U.S. 471, 114 S.Ct. 996, 127 L.Ed.2d 308 (1994); Keifer & Keifer v. Reconstruction Fin. Corp., 306 U.S. 381, 59 S.Ct. 516, 83 L.Ed. 784 (1939), or the question whether they are agencies or instrumentalities of the United States for the purpose of individual rights guaranteed against the Government by the Constitution. See Lebron v. Nat'l R.R. Passenger Corp., 513 U.S. 374, 115 S.Ct. 961, 130 L.Ed.2d 902 (1995).

. The majority protests that Supreme Court jurisprudence "requires" it to distinguish tribal from state sovereign immunity and suggests that looking to arm-of-the-state jurisprudence would "diminish" the "inherent nature of tribal sovereignty." Maj. op. at 1110 n. 11. Apart from indicating that tribal sovereign immunity is not coextensive with that of the States, the Supreme Court has never suggested any difference that *1118might affect the determination whether a suil brought against another person or entity is in fact a suit against the sovereign, and the majority offers none.

. Subsequent to our articulation of a three-part test in Simon, the United States Supreme Court broadened the focus on the importance of protecting the public fise by holding that "[the preeminent purpose of state sovereign immunity is to accord States the dignity that is consistent with their status as sovereign entities." See Fed. Maritime Comm'n v. S.C. State Ports Auth., 535 U.S. 743, 760, 122 S.Ct. 1864, 152 L.Ed.2d 962 (2002).

. I (as I am sure will any lower court reading the majority opinion) consider completely illusory the suggestion that a separate burden-of-production question remains undecided. The majority expressly places on the state the burden of proving the entities are not arms of the tribe; strikes down the court of appeals' attempt to separate the burden of persuasion from the burden of production; and openly opines that requiring an entity claiming to be an arm of a tribe to produce any information relative to its claim may amount to an impermissible limitation on tribal sovereign immunity.