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Amerind Risk Management Corp. v. Blackfeet Housing

United States District Court, D. New Mexico

October 17, 2017

AMERIND RISK MANAGEMENT CORPORATION, a federally chartered Section 17 Tribal Corporation, Plaintiff,


         Plaintiff Amerind Risk Management Corporation (Plaintiff) seeks declaratory and injunctive relief from litigation brought by Defendant Blackfeet Housing (Defendant) in the Blackfeet Tribal Courts.[1] The Court previously denied Defendant's motion to dismiss for lack of jurisdiction after concluding that the Court has subject matter jurisdiction over this case under 28 U.S.C. § 1332 and personal jurisdiction over Defendant.[2] The Court also found that Plaintiff has exhausted tribal remedies, so that its challenge to the jurisdiction of the Blackfeet Tribal Courts may go forward in this Court. Both parties have now moved for summary judgment, and the motions are fully briefed.[3] The Court will grant summary judgment in favor of Plaintiff.

         I. BACKGROUND

         Although the issues before this Court are jurisdictional, at the root of the conflict between the parties is a dispute over insurance coverage. Plaintiff is a federally chartered tribal corporation formed under Section 17 of the Indian Reorganization Act, 25 U.S.C. § 5124 (formerly § 477). See Charter of Incorporation (Doc. No. 12-2). The charter tribes are the Red Lake Band of Chippewa Indians, the Confederated Salish and Kootenai Tribes of the Flathead Reservation, and the Pueblo of Santa Ana. Plaintiff was formed to provide risk-sharing self-insurance for tribal governments and entities in response to a lack of affordable insurance options on tribal lands. Plaintiff has over 400 tribal member entities that contribute capital to a risk pool for each line of coverage, from which Plaintiff pays all covered claims. Members' participation in the risk-sharing group is governed by contractual agreement.

         Defendant is a member entity that entered into a Participation Agreement (PA) (Doc. No. 17-1) in March 2012 to join Plaintiff's Tribal Operations Protection Plan (TOPP) risk pool. The PA provides that participants in TOPP “agree to jointly share in the costs of protecting against financial loss and in the monetary claims that may arise from financial loss.” In return, the PA guarantees that TOPP will indemnify members “in accordance with any coverage documents issued to the Participant and this agreement, but only from the assets of TOPP.”

         The PA contains procedures for the resolution of any disputes between Plaintiff and TOPP participants that arise out of or are related to the PA. Disagreements must first be addressed through informal mediation, which, if not successful within 90 days, is to be followed by binding arbitration according to a specified process. Arbitration is to be held in Albuquerque, New Mexico, and the arbitrator is to apply the substantive law of the Pueblo of Santa Ana. Any award may be entered and enforced only in one of three Courts of Competent Jurisdiction: this Court, the Second Judicial District Court of the State of New Mexico, or the Pueblo of Santa Ana Tribal Court. Either party may also bring an action in any of the Courts of Competent Jurisdiction to compel arbitration, determine the validity of the PA, determine the authority of the signatories to the PA, or determine whether tribal sovereign immunity or tribal remedies have been waived.

         As a participant in TOPP governed by the March 2012 PA, Defendant obtained four insurance policies from Plaintiff. Defendant contacted Plaintiff in April 2013 regarding issues with some of its covered properties. Then in August 2013 Defendant made formal claims under its policies for damage to 130 dwellings. In February 2014, while Plaintiff was still evaluating the claims, Defendant sent Plaintiff a demand for over 1.4 million dollars. Plaintiff denied the claims in March 2014. Defendant, rather than invoking the dispute resolution procedures contained in the PA, filed suit against Plaintiff in the Blackfeet Tribal Court alleging breach of fiduciary duty, breach of contract, breach of the duty of good faith, and violations of Blackfeet tribal law. See Blackfeet Hous. v. Amerind Risk Mgmt. Corp., Case No. 2014 CA-60 (filed April 18, 2014) (Doc. No. 28-2).

         Plaintiff made a special appearance in the Blackfeet Tribal Court and moved to dismiss the suit for lack of jurisdiction, asserting sovereign immunity and relying on the choice of forum provision in the PA. But the Blackfeet Tribal Court denied Plaintiff's motion to dismiss after concluding that Plaintiff did not have tribal sovereign immunity and that the Blackfeet Tribal Court had jurisdiction to decide Defendant's claim. See Blackfeet Hous. v. Amerind Risk Mgmt. Corp., Case No. 2014 CA-60 (Order filed Oct. 1, 2015) (Doc. No. 17-2). Plaintiff appealed the jurisdictional issue to the Blackfeet Court of Appeals, which heard oral argument on March 22, 2016, but had not yet decided the case in October 2016 when Plaintiff filed this suit for declaratory and injunctive relief from the tribal litigation.

         The Blackfeet Court of Appeals issued its decision in November 2016, holding that Plaintiff did have tribal sovereign immunity as a Section 17 tribal corporation, but that Plaintiff had waived that immunity by including an arbitration clause in the PA. See Blackfeet Hous. v. Amerind Risk Mgmt. Corp., Cause No. 2015-AP-09 (Order filed Nov. 7, 2016) (Doc. No. 17-3). The Blackfeet Court of Appeals acknowledged Plaintiff's argument that any waiver of immunity was limited to the courts specified in the PA for enforcement of the arbitration provision, and stated that it would normally agree. See Id. at 16, ¶ 20. But without giving any reason for broadening the limited waiver, the Blackfeet Court of Appeals appears to have concluded that it had jurisdiction. See Id. at 16-18, ¶¶ 20-25. The Blackfeet Court of Appeals ordered the parties to “proceed to mediation as contemplated by the Participation Agreement and thereafter to arbitration if needed.” See Id. at 18, ¶ 25. Because it concluded that Plaintiff “previously failed to properly mediate this dispute, and caused Blackfeet Housing to incur costs for an illusory mediation at great expense, ” the Blackfeet Court of Appeals ordered that Plaintiff would be “responsible for the entire expense of the future mediation.” See Id. at 18, ¶ 25. The tribal court has since denied Defendant's motions to reconsider this ruling and to allow a rehearing.[4] The issue of the Blackfeet Tribal Court's jurisdiction is now before this Court.


         “[T]he scope of a tribal court's jurisdiction is a federal question over which federal district courts have jurisdiction.” Thlopthlocco Tribal Town v. Stidham, 762 F.3d 1226, 1234 (10th Cir. 2014) (internal quotation marks omitted) (considering a tribal court's exercise of jurisdiction over another tribe). Summary judgment may be granted if the moving party shows “there is no genuine issue as to any material fact and that the moving party is entitled to a judgment as a matter of law.” Fed.R.Civ.P. 56(c). “When applying this standard, [the Court] view[s] the evidence and draw[s] reasonable inferences therefrom in the light most favorable to the nonmoving party.” Scull v. New Mexico, 236 F.3d 588, 595 (10th Cir. 2000) (internal quotation marks omitted). The court will analyze each motion individually and on its own merits if both parties have moved for summary judgment. See Buell Cabinet Co. v. Sudduth, 608 F.2d 431, 433 (10th Cir. 1979) (explaining that “[c]ross-motions for summary judgment are to be treated separately; the denial of one does not require the grant of another.”). Cross-motions for summary judgment entitle the Court “to assume that no evidence needs to be considered other than that filed by the parties, but summary judgment is nevertheless inappropriate if disputes remain as to material facts.” Atlantic Richfield Co. v. Farm Credit Bank of Wichita, 226 F.3d 1138, 1148 (10th Cir. 2000). “A fact is material only if it might affect the outcome of the suit under the governing law. And a dispute over a material fact is genuine only if the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Bennett v. Windstream Commc'ns, Inc., 792 F.3d 1261, 1265-66 (10th Cir. 2015). “Where the facts are not in dispute . . ., summary disposition is appropriate.” Christian Heritage Acad. v. Okla. Secondary Sch. Activities Ass'n, 483 F.3d 1025, 1030 (10th Cir. 2007).


         Plaintiff contends that as a federally-chartered tribal corporation formed under Section 17, it possesses tribal sovereign immunity that it has waived only in the limited circumstances specified in the PA. Plaintiff asks the Court to declare that it has sovereign immunity from suit in the Blackfeet Tribal Courts, which consequently lack jurisdiction over Defendant's claims, and that the dispute resolution procedures specified in the PA are applicable to the conflict. Plaintiff requests that the Court enjoin Defendant from attempting to further litigate this matter in the Blackfeet Tribal Courts or to enforce the invalid order of the Blackfeet Court of Appeals. By contrast, Defendant asserts that dispute resolution between the parties is governed by the TOPP Scope of Coverage Document (Doc. No. 36-1) (SCD) rather than the PA, and that in the SCD Plaintiff consented to the jurisdiction of the Blackfeet Tribal Courts and waived any sovereign immunity it might have. Additionally, Defendant disputes Plaintiff's entitlement to sovereign immunity and argues that jurisdiction is proper in the Blackfeet Tribal Courts based on Montana v. United States, 450 U.S. 544 (1981).

         A. Sovereign Immunity

         “Indian tribes are distinct, independent political communities, retaining their original natural rights in matters of local self-government. Although no longer possessed of the full attributes of sovereignty, they remain a separate people, with the power of regulating their internal and social relations.” Santa Clara Pueblo v. Martinez, 436 U.S. 49, 55 (1978) (citations omitted) (internal quotation marks omitted). Because tribes retain sovereign powers, they possess immunity from suit to the extent that Congress has not abrogated that immunity and the tribe has not clearly waived its immunity. Id. at 58. “[S]overeign immunity [is] an inherent part of the concept of sovereignty and . . . ‘is . . . necessary to promote . . . tribal self-determination, economic development, and cultural autonomy.'” Breakthrough Mgmt. Grp., ...

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