Court Opinion

ID: 9496134
Source: CourtListenerOpinion
Date Created: 2023-08-05 16:18:50.689893+00
Date Added: 2024-06-11T17:57:21.789276
License: Public Domain

FERGUSON, Circuit Judge,
dissenting.
I must respectfully dissent. Although I agree with the majority that, as a general rule, we regard a judicial interpretation of a statute as an “authoritative statement of what the statute meant before as well as after the decision of the case giving rise to that construction,” Rivers v. Roadway Express, 511 U.S. 298, 312-13, 114 S.Ct. 1510, 128 L.Ed.2d 274 (1994), I believe the instant case presents exactly the kind of “rare case” which the Court in United States v. Estate of Donnelly recognized might be exempted from the full retroactive effect of a decision construing a statute. See United States v. Donnelly, 397 U.S. 286, 295, 90 S.Ct. 1033, 25 L.Ed.2d 312 (1970). I would hold that in cases such as the instant one, in which the decision to be retroactively applied announced a “new” interpretation of the statute, and in which both compelling equitable considerations as well as principles of finality weigh against retroactive application of the decision, the general rule must give way to “familiar considerations of fair notice, reasonable reliance, and settled expectations.” See Landgraf v. USI Film Prods., 511 U.S. 244, 270, 114 S.Ct. 1483, 128 L.Ed.2d 229 (1994).
As an initial matter, I do not find the language from Rivers which the majority quotes to be binding in this case. While the majority cites Rivers for the general proposition that judicial interpretations of statutes are generally retroactively applied to the date of enactment, the most succinct and squarely controlling articulation of this principle was announced in United States v. Donnelly, the case which I believe, as I discuss below, should control our analysis. Although Donnelly held that “[ajcts of Congress are generally to be applied uniformly throughout the country from the date of their effectiveness onward,” Donnelly, 397 U.S. at 294, 90 S.Ct. 1033 (emphasis added), it also stated that certain kinds of “justified reliance” could “warrant withholding retroactive application of a decision construing a statute as Congress intended it.” Id. at 295, 90 S.Ct. 1033. Thus, Donnelly dealt squarely with precisely the issue that we currently confront.
By contrast, the language from Rivers that the majority relies upon was written in response to an entirely different legal question than the one presented here. In Rivers, the court was grappling with the “sole question whether [a 1991 Act altering a rule of law established in a Supreme Court case interpreting the Civil Rights Act] applies to cases pending when it was enacted.” 511 U.S. at 303, 114 S.Ct. 1510. In response to this question, the Rivers court held that “when Congress intends to supersede a rule of law embodied in one of our decisions ... its intent to reach conduct preceding the ‘corrective’ amendment must clearly appear.” Id. at 313, 114 S.Ct. 1510. While the Court noted its belief that “when this Court construes a statute, it is explaining its understanding of what the statute has meant continuously since the date when it became law,” id. at 313 n. 12, 114 S.Ct. 1510, it did not squarely address the issue of the appropriate scope of retroactive application of its own decisions interpreting statutes, nor did it preclude the *583possibility of a limiting principle to the general rale.1
While we generally give “due deference” to Supreme Court dicta, see United States v. Baird, 85 F.3d 450, 453 (9th Cir.1996), such deference cannot and should not be unlimited. See Batjac Productions Inc. v. GoodTimes Home Video Corp., 160 F.3d 1223, 1232 (9th Cir.1998) (citing United States v. CraWley, 837 F.2d 291, 292-93 (7th Cir.1988) as “noting reasons for rejecting dicta, such as (1) unnecessary to the outcome of the case; (2) can be deleted without affecting the argument; (3) not grounded in the facts of the case; (4) issue addressed was not present as an issue in the case.”). In particular, dicta should not be controlling when there is another case more squarely on point. See Humphrey’s Ex’r v. United States, 295 U.S. 602, 627, 55 S.Ct. 869, 79 L.Ed. 1611 (1935) (“ ‘general expressions, in every opinion, are to be taken in connection with the case in which those expressions are used. If they go beyond the case, they may be respected, but ought not to control the judgment in a subsequent suit, when the very point is presented for decision.’ ”). Assuming that the broad Rivers language is what it appears to be — dicta—it should not trump the significant equitable and finality concerns at play in this case.
In a case subsequent to Rivers, the Court also announced that, in general, “[n]ew legal principles, even when applied retroactively, do not apply to cases already closed,” particularly cases that present “special finality-related concerns.” Reynoldsville Casket Co. v. Hyde, 514 U.S. 749, 758, 115 S.Ct. 1745, 131 L.Ed.2d 820 (1995). Reynoldsville Casket also recognized certain principles that might limit retroactive application of a new rale even in cases which were pending when the novel decision was issued. See Reynoldsville Casket, 514 U.S. at 759, 115 S.Ct. 1745. I believe these same principles are applicable in this case, in particular general principles of equity “reflect[ing] both reliance interests and other significant policy justifications,” and “principle[s] of law, such as that of ‘finality’ ... that limit[ ] the principle of retroactivity itself.” Id. at 759, 115 S.Ct. 1745. For all of these reasons, Donnelly, and not Rivers, should control in this case.
Under Donnelly, the Court’s decision in Minnesota v. United States, 305 U.S. 382, 386, 59 S.Ct. 292, 83 L.Ed. 235 (1939), should not be retroactively applied to the parties in this case. Although the Supreme Court has never clearly set out a limiting principle to retroactive judicial statutory interpretation, I believe that the decisions in Donnelly and Reynoldsville Casket provide us with ample guidance. In particular, I believe that the presence of the following factors prohibits full retroactive application of the decision in Minnesota in this case: (1) the presence of a novel decision regarding the statute, such that the City of Tacoma can claim “justifiable reliance” on its earlier interpretation of the statute; (2) the fact that the government did not adhere to the statutory construction it now seeks to rely upon at the time of the underlying proceedings; (3) the fact that the underlying proceedings, *584when viewed in their entirety, comply with the spirit and the purposes of the rule announced in Minnesota as well as all but one of the elements required to give a proceeding res judicata effect; (4) the serious finality concerns raised by vacating a proceeding upon which the parties have relied for over eighty years, and which the government did not seek to challenge until nearly sixty years after the intervening statutory decision; and (5) the fact that no injustice or actual prejudice is alleged to have resulted from the underlying action.
First, unlike the plaintiffs in Donnelly, the City of Tacoma faced the task of interpreting a vague statute that provided no guidance as to how to proceed with public-use condemnation of Tribal lands. Cf. Donnelly, 397 U.S. at 293, 90 S.Ct. 1033.2 In other words, the City of Tacoma faces the retroactive application of, for all practical purposes, a new rule of law, at least as measured by the position it was in in 1921. See Chevron Oil Co. v. Huson, 404 U.S. 97, 106, 92 S.Ct. 349, 30 L.Ed.2d 296 (1971) (A new rule of law is created when a court “overrul[es] clear past precedent on which litigants may have relied, or [decides] an issue of first impression whose resolution was not clearly foreshadowed.”) (citing Hanover Shoe, Inc. v. United Shoe Mach. Corp., 392 U.S. 481, 496, 88 S.Ct. 2224, 20 L.Ed.2d 1231 (1968) and Allen v. State Bd. of Elections, 393 U.S. 544, 572, 89 S.Ct. 817, 22 L.Ed.2d 1 (1969)). At the time of the Funk proceedings, the Minnesota decision was not such a foregone conclusion that the City of Tacoma was unreasonable in believing that it was permissible to enter only a conditional judgment that was explicitly subject to the approval of the United States. See Allen, 393 U.S. at 572, 89 S.Ct. 817 (resolution of a case not clearly foreshadowed when resolution of the issues is “subject to rational disagreement.”); see also Hanover Shoe, 392 U.S. at 499, 88 S.Ct. 2224. The “clear language” of § 357 provided no guidance as to how a state should proceed when condemning reserved land, merely stating that a state was permitted to condemn lands allotted in severalty to Indians. See 25 U.S.C. § 357; cf. Donnelly, 397 U.S. at 293, 90 S.Ct. 1033.
Contrary to the majority’s assertion, the Supreme Court cases preceding Minnesota provided no more guidance to the City of Tacoma than the statute. In Bowling & Miami Inv. Co. v. United States, 233 U.S. 528, 534, 34 S.Ct. 659, 58 L.Ed. 1080 (1914), the Court focused on the scope of the United State’s authority regarding allotted land, holding that “the United States has capacity to sue for the purpose of setting aside conveyances of lands allotted to Indians under its care, where restrictions upon alienation have been transgressed ... [as well as the complementary] authority to enforce [such] restrictions.” The Court did not hold that the United States must be named as a party in any action, instead reasoning that “[t]he authority of the United States to enforce the restraint ... cannot be impaired by any action without its consent.” 233 U.S. at 535, 34 S.Ct. 659 (emphasis added). Privett v. United States merely reiterated the language in Bowling, focusing on the need of the United States to protect its own interest *585in the land at issue in that case, but not even suggesting an absolute requirement that the United States be made a party to any action involving Indian land. See 256 U.S. 201, 204, 41 S.Ct. 455, 65 L.Ed. 889 (1921). In short, the City of Tacoma was entirely reasonable in believing that by securing the United States’ consent to the condemnation proceeding, they had complied with any implied requirements in § 357. Cf. Donnelly, 397 U.S. at 293, 90 S.Ct. 1033.
Second, unlike the United States in Donnelly, the government in this case did not “adhere” to what it now believes “to be the correct interpretation of the statute” at the time of the underlying condemnation proceeding, thus it cannot now claim that it should “reap the benefits of that adherence.” See id. 397 U.S. at 294. Quite to the contrary, in this case the United States reviewed and consented to the proceedings, and made no effort, even after Minnesota was decided, to seek review or contest the proceedings. Cf. Donnelly, 397 U.S. 292-94, 90 S.Ct. 1033.
The 1921 conditional judgment explicitly required the “approval of the proper authorities of the United States Government.” While Sams, the Superintendent of the Indian School on the reservation to whom the City of Tacoma initially addressed its notice, initially expressed concerns regarding the validity of the condemnation proceedings, over the course of the next nine months and after research by the Assistant United States Attorney and investigations by Sams acting on behalf of officials at the Department of the Interior, all of the officials — including Sams, the Assistant United States Attorney, the Assistant Commissioner of Indian Affairs, and the Assistant Secretary of the Department of the Interior — agreed to consent to the condemnation and approve the judgment. In sum, the United States fully explored its options and exercised complete control over the case for almost a year.
In viewing these facts, it is clear that the United States was given more power than it would have had as a party in any court, including the court itself. It was given the absolute power to unabashedly protect its own interests and the interests of the Sko-komish Indian Tribe, adjudicate its own claims, and approve or disapprove of the judgment. Moreover, the proper government officials at the Department of Justice and the Department of Interior exercised these powers and reached the conclusion that the conveyances were valid and should be approved. Under the law as it stood at the time the condemnation judgment was finalized, the City of Tacoma and the state court were entirely reasonable in believing they had complied with both the letter and the spirit of § 357. In short, the purpose of the Supreme Court’s holding in Minnesota has been fulfilled by the particular circumstances set forth in this case.3
It is simply indefensible to suggest that the City of Tacoma, through no fault of its own, must bear the burden of the United States’ failure to adequately protect either its own interests or the interests of the *586Tribe. We have previously recognized that mismanagement of Indian lands
cannot to be said to be out of character with the sort of thing which Congress and the Department of the Interior has been doing throughout the said [stet.] history of the Government’s dealings with the Indians ... [a] history [which] largely supports the statement: ‘From the very beginnings of this nation, the chief issue around which federal Indian policy has revolved has been, not how to assimilate the Indian nations whose lands we usurped, but how best to transfer Indian lands and resources to non-Indians’.
United States v. Ahtanum Irrigation Dist., 236 F.2d 321, 337 (9th Cir.1956) (quoting Dorothy Van de Mark, The Raid on the Reservations, Harper’s Magazine, Mar. 1956). Nevertheless, “[t]he Secretary [of the Interior’s] mistakes, his poor judgment, his overlooking or ignoring of the true measure of the Indian’s rights, his lack of bargaining skill or determination may add up to an abuse of his power, but do not negative it, or make his act ultra vires.” Id. at 338. While it is arguable that the United States breached its fiduciary duty to the Tribe by failing to protect the Tribe’s interests in the Funk proceedings, we cannot rewrite history to pretend its actions did not have legal consequence when it is clear that they did.
The historical fiction in which the majority indulges is particular problematic in the context of the case in which the underlying proceedings occurred nearly a century ago. While the United States may not be formally bound by the doctrine of res judicata because it was not made a party in Funk, unlike the transaction in Donnelly, the Funk proceedings have now “acquired such a degree of finality that the rights of the-parties should be considered frozen.” Donnelly, 397 U.S. at 296, 90 S.Ct. 1033 (Harlan, J., concurring). The majority’s application of Rivers to the facts of this case raises very significant finality concerns, as apparently all proceedings that the United States otherwise validated that preceded the Minnesota decision will now be vacated, despite the fact that all of the parties involved have relied on the resolution of these issues for over eighty years.
Finally, the fact the United States does not allege that any injustice or unfairness resulted from the Funk proceedings further supports rejecting the retroactive application of Minnesota. The United States does not contend that the Tribe did not receive a fair award for the land, or that the proceedings were in any other way untoward or inequitable. Thus, it is not clear what purpose the declaratory relief the government requests serves, except to allow it to renegotiate a transaction which it had every opportunity to negotiate years ago. While at one point the United States asserts that a holding against it would “prevent [it] from meeting [its trust responsibility to the tribes and individual Indians and] harm the public interest,” it seems to me that the United States has no one but itself to blame if its own officials fail to exercise their trust responsibilities faithfully and diligently.
In this case, we have a judicial interpretation of a statute that essentially operates as a new rule of law. In addition, we have a municipality that made every reasonable effort to comply with the law as it stood at the time of the Funk proceeding. Most importantly, the condemnation process, when viewed in its entirety, complied with the purpose and goals, if not the letter, of Minnesota’s holding. Finally, we have proceedings which no one now asserts resulted in unfairness or inequity, and which remained unchallenged for decades, despite the government’s full knowledge of *587both the effect of those proceedings and the intervening decision interpreting the statute.4 In light of these facts, we should impose the burden of the United States’ failure to protect its own or the Tribe’s interests on the United States, not the City of Tacoma.
I am not unsympathetic to the members of the Tribe whose interests may have been disadvantaged because of the United States’ disgraceful mismanagement, indifference, and inaction. Nevertheless, the majority’s form over substance approach shifts the burden of the United States’ failure to act as a diligent trustee onto a state municipality that did everything in its power to ensure that the United States had an opportunity to validate the land transfer that underlies the instant case. Because I do not believe that either the Supreme Court’s statutory retroactivity jurisprudence or fundamental principles of equity countenance such a result, I dissent.

. The portion of Rivers which the majority relies upon, which cites no support or authority for its reasoning, seems a particularly fragile foundation upon which to rest, given the counterbalancing fairness concerns which the City of Tacoma raises. Indeed, if we were to take the quoted Rivers language on its face, as the majority appears to do, it would raise enormous ex post facto problems in the criminal context. The Supreme Court has made it abundantly clear that retroactive application of a novel judicial interpretation of a criminal statute is prohibited. See Rogers v. Tennessee, 532 U.S. 451, 457, 121 S.Ct. 1693, 149 L.Ed.2d 697 (2001).

. The Donnelly court noted that the decision to be retroactively applied in that case, its opinion in United States v. Union Central Life Ins. Co., 368 U.S. 291, 82 S.Ct. 349, 7 L.Ed.2d 294 (1961), “merely construed [statute], in accordance with the clear language of the statute, ... [consistently with] courts and other authority who had considered the question, ... [and] in accordance with the will of Congress as expressed in ... [an amendment to the statute] and the accompanying legislative history.” Donnelly, 397 U.S. at 293, 90 S.Ct. 1033.

. If nothing else, equity requires that caselaw not be applied without considering the purpose and goals of the laws that are being interpreted. Bd. of Com’rs v. United States, 308 U.S. 343, 350, 60 S.Ct. 285, 84 L.Ed. 313 (1939) (“Instead of choosing a rigid rule, the Court has drawn upon those flexible considerations of equity which are established sources for judicial law-making.”); see United States v. Peck, 102 U.S. 64, 66, 26 L.Ed. 46 (1880) (applying fundamental principles of equity against the government as a party to a contract); cf. Omaha Indian Tribe v. Jackson, 854 F.2d 1089, 1095 (8th Cir.1988) (applying principles of equity in a quiet title action).

. Indeed, the Tribe specifically requested that the government intervene on its behalf in 1977, yet the government still waited nearly twenty years before taking action.