UTE Indian Tribe of the Uintah & Ouray Reservation v. McKee

32 F.4th 1003

UTE INDIAN TRIBE OF the UINTAH AND OURAY RESERVATION, Plaintiff - Appellant,

v.Gregory D. MCKEE; T & L Livestock, Inc.; McKee Farms, Inc.; GM Fertilizer, Inc., Defendants - Appellees.

No. 20-4098

United States Court of Appeals, Tenth Circuit.

FILED April 27, 2022

Frances C. Bassett, Patterson Earnhart Real Bird & Wilson LLP, (Jeremy J. Patterson with her on the briefs), Louisville, Colorado, for Plaintiff-Appellant

J. Craig Smith, Smith Hartvigsen, PLLC, (Clark R. Nielsen, Jennie B. Garner, and Devin L. Bybee with him on the brief), Salt Lake City, Utah, for Defendants-Appellees

Before BACHARACH, KELLY, and CARSON, Circuit Judges.

CARSON, Circuit Judge.

Courts serve the important function in our society of dispassionately resolving legal disputes. But a court may do so only when its jurisdiction covers the parties and the subject matter of the dispute. This appeal boils down to whether a tribal court has jurisdiction over a dispute between the tribe and a non-Indian about rights to water within reservation boundaries but not on Indian land.

This case arises from a long-running irrigation-water dispute between Plaintiff Ute Indian Tribe of the Uintah and Ouray Reservation and Defendant Gregory McKee, who is not a member of the Tribe.¹ Defendant owns non-Indian fee land within the Ute reservation's exterior boundaries and uses water from two irrigation canals flowing through his property. Plaintiff claims the water belongs to the United States in trust for the Tribe.

Plaintiff sued Defendant in the Ute tribal court, alleging that Defendant had been diverting the Tribe's water for years, and won. Plaintiff then petitioned the district court to recognize and enforce the tribal-court judgment. But the district court dismissed the case after holding that the tribal court lacked jurisdiction to enter its judgment. Because we too conclude that the tribal court lacked jurisdiction over Plaintiff's dispute with a nonmember of the Tribe arising on non-Indian fee lands, we exercise jurisdiction under 28 U.S.C. § 1291 and affirm.

I.

In the nineteenth century, the federal government entered a treaty with many bands of the Ute Indian Tribe to create a tribal reservation. See Treaty with the Ute Indians art. 2, March 2, 1868, 15 Stat. 619. In the early twentieth century, under the General Allotment Act of 1887, ch. 119, 24 Stat. 388 (codified as amended at 25 U.S.C. § 331 et seq . ), the United States divided the reservation into "allotments," creating individual parcels of land that the government then gave to individual tribe members. See Act of March 3, 1905, ch. 1479, 33 Stat. 1048, 1069. The government then opened any remaining reservation land for settlement by non-Indians. See id. Around the same time, Congress authorized the Uintah Indian Irrigation Project ("UIIP") to build canals and ditches to irrigate the Ute Indians’ allotted lands. See Act of June 21, 1906, ch. 3504, 34 Stat. 325, 375. Congress provided that the Secretary of the Interior would hold title to the UIIP "in trust for the Indians." Id.

In 1923, the United States, as trustee of the Ute Indians, sued many non-Indians in the District of Utah over the use of irrigation water in the UIIP area. See United States v. Cedarview Irrigation Co., No. 4427 (D. Utah 1923) ("Cedarview Decree"). The court decreed that the Indians had "the first and an exclusive right ... to divert from the Uintah River and its tributaries by certain ditches and canals water in certain quantities at certain times and under certain conditions." Id. at 2. The court explained that any rights that the non-Indian defendants had in the water were subordinate to the Indians’ rights, so the court permanently enjoined "all persons diverting or using water" from the UIIP from "hindering, preventing or interfering" with the Ute Indians’ water rights. Id. at 6.

In 1934, Congress passed the Indian Reorganization Act, ch. 576, 48 Stat. 984, 984, 987 (1934) (codified at 25 U.S.C. §§ 5101, 5123 ), ending the allotment of tribal lands and authorizing Indian tribes to adopt constitutions and charters for self-governance. The Ute Indian Tribe of the Uintah and Ouray Reservation adopted a constitution and bylaws in 1937, creating a tribal government for its territory. See Hackford v. Babbitt, 14 F.3d 1457, 1461 (10th Cir. 1994).

Defendant, who is not a member of the Ute Tribe, owns land that was part of the Ute reservation but opened for non-Indian settlement during the allotment period of the early twentieth century. Two UIIP canals—the Deep Creek Canal and Lateral No. 9—cross Defendant's property. In 2012, Plaintiff received a report that Defendant was diverting water from the Deep Creek Canal and Lateral No. 9 to flood irrigate his property. Plaintiff investigated and determined that Defendant was unlawfully misappropriating tribal waters in violation of the Cedarview Decree.

Plaintiff sued Defendant in the Ute tribal court. Defendant moved to dismiss the complaint for lack of subject-matter jurisdiction. The tribal court denied the motion, holding that it had subject-matter jurisdiction because the Ute Tribe has sovereign authority to manage the use of its territory and natural resources by tribe members and nonmembers. The tribal court further held that it had subject-matter jurisdiction also under Montana v. United States, 450 U.S. 544, 101 S.Ct. 1245, 67 L.Ed.2d 493 (1981), because the Tribe can regulate activities of all non-Indians who enter a consensual relationship with the Tribe or whose conduct imperils the Tribe's political integrity, economic security, or health and welfare. Defendant then ceased participating in the litigation. After a bench trial, the tribal court found that Plaintiff was the beneficial owner of the water in the Deep Creek Canal and Lateral No. 9 and that Defendant misappropriated tribal water to irrigate his property. The tribal court entered judgment against Defendant.

To date, Defendant has satisfied no part of the tribal court's judgment. In April 2018, Plaintiff petitioned the District of Utah to recognize and enforce the tribal court's judgment against Defendant. The parties cross-moved for summary judgment. The district court granted Defendant's motion, holding that the tribal-court judgment was unenforceable because the tribal court lacked subject-matter jurisdiction, and dismissed the case. The district court also denied Plaintiff's motion for leave to amend because the court determined that the proposed amendment would have been futile. Plaintiff appeals.

II.

A.

Plaintiff first challenges the district court's grant of summary judgment for Defendant. We review a grant of summary judgment de novo. US Airways, Inc. v. O'Donnell, 627 F.3d 1318, 1324 (10th Cir. 2010) (citation omitted). We review the evidence in the light most favorable to the nonmoving party, affirming only if no genuine dispute exists about any material fact and the movant is entitled to judgment as a matter of law. Tesone v. Empire Mktg. Strategies, 942 F.3d 979, 994 (10th Cir. 2019) (citations omitted). We also review de novo any legal questions the district court resolved in granting summary judgment. In re MDL 2700 Genentech Herceptin (Trastuzumab) Mktg. & Sales Prac. Litig., 960 F.3d 1210, 1224 (10th Cir. 2020) (citation omitted). The scope of a tribal court's jurisdiction is a question of federal law. Thlopthlocco Tribal Town v. Stidham, 762 F.3d 1226, 1234 (10th Cir. 2014) (citation omitted).

Indian tribes are independent communities with many rights and powers of self-government, but those powers are limited. Plains Com. Bank v. Long Fam. Land & Cattle Co., 554 U.S. 316, 327, 128 S.Ct. 2709, 171 L.Ed.2d 457 (2008) (citations omitted). And while tribal sovereignty includes the authority to adjudicate disputes in tribal courts, a tribal court's jurisdiction cannot exceed the tribe's legislative authority. Id. at 330, 128 S.Ct. 2709 (citation omitted). For example, tribes can generally regulate only their territory and their members on the reservation. See id. at 327, 128 S.Ct. 2709. And though Indian tribes can exclude outsiders from tribal land, they have no general authority over nonmembers of the tribe. Id. at 327–28, 128 S.Ct. 2709 (citations omitted). That is true even when nonmembers engage in activity on the reservation and especially when they do so on "non-Indian fee land"—land owned in fee simple by non-Indians. Id. at 328, 128 S.Ct. 2709 (citation omitted).

The Supreme Court has recognized only two exceptions under which Indian tribes can regulate nonmembers. Tribes can regulate the activity of nonmembers who enter consensual relationships with them or their members, and they can regulate the activity of nonmembers on reservation land—even non-Indian fee land—if that activity threatens their political integrity, economic security, or health and welfare. Montana, 450 U.S. at 565–66, 101 S.Ct. 1245 (citations omitted). But these exceptions are narrow, and a tribal court presumptively lacks jurisdiction over nonmembers’ activities on non-Indian fee land. See Plains Com., 554 U.S. at 330, 128 S.Ct. 2709. Thus, Plaintiff bears the burden of showing that one of the exceptions applies if it wishes to overcome the presumption that it cannot regulate Defendant's activities on non-Indian fee land. Id. (citation omitted).

Plaintiff first argues that it need not resort to the Montana exceptions to establish tribal-court jurisdiction because an Indian tribe has inherent sovereign authority to exclude nonmembers from its territory. Plaintiff argues that because it is the beneficial owner of the exclusive right to use the water in the Deep Creek Canal and Lateral No. 9, its inherent authority to exclude others from its territory includes the authority to exclude others from using its water. And although Defendant, a nonmember of the Tribe, allegedly misappropriated Plaintiff's water on non-Indian fee land, Plaintiff argues that "no rational basis in law or logic" supports treating water...