Pauma Band Mission Indians v. State of California

FOR PUBLICATION

UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT

PAUMA BAND OF LUISENO MISSION No. 18-56457
INDIANS OF THE PAUMA & YUIMA
RESERVATION, AKA Pauma Band of D.C. No.
Mission Indians, AKA Pauma 3:16-cv-01713-
Luiseno Band of Mission Indians, BAS-JMA
Plaintiff-Appellant,

v. OPINION

STATE OF CALIFORNIA; GAVIN
NEWSOM *, as Governor of the State
of California,
Defendants-Appellees,

and

CALIFORNIA GAMBLING CONTROL
COMMISSION, an agency of the State
of California; Attorney General for
the State of California,
Defendants.

*
Gavin Newsom, the Governor of the State of California, is
substituted for Edmund G. Brown Jr. See Fed. R. App. P. 43(c)(2).
2 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

Appeal from the United States District Court
for the Southern District of California
Cynthia A. Bashant, District Judge, Presiding

Submitted July 6, 2020 **
Pasadena, California

Filed September 2, 2020

Before: Carlos T. Bea and Bridget S. Bade, Circuit Judges,
and Yvonne Gonzalez Rogers, *** District Judge.

Opinion by Judge Bade

SUMMARY ****

Indian Gaming Regulatory Act

The panel affirmed the district court’s partial grant of
summary judgment in favor of the State of California and the
Governor of the State of California, defendants in an action
arising from negotiations for a new tribal-state compact
between the State and the Pauma Band of Luiseno Mission

**
The panel unanimously concludes this case is suitable for decision
without oral argument. See Fed. R. App. P. 34(a)(2).
***
The Honorable Yvonne Gonzalez Rogers, United States District
Judge for the Northern District of California, sitting by designation.
****
This summary constitutes no part of the opinion of the court. It
has been prepared by court staff for the convenience of the reader.
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 3

Indians of the Pauma and Yuima Reservation for class III
gaming under the Indian Gaming Regulatory Act.

The panel agreed with the district court that the State
satisfied its obligation to negotiate in good faith under IGRA
because the State agreed to negotiate for the new types of
class III gaming that Pauma sought authorization to offer at
its casino, actively engaged in the negotiations, and
remained willing to continue the negotiations when Pauma
filed this litigation.

COUNSEL

Cheryl A. Williams and Kevin M. Cochrane, Williams &
Cochrane LLP, Temecula, California, for Plaintiff-
Appellant.

Xavier Becerra, Attorney General; Sara J. Drake, Senior
Assistant Attorney General; T. Michelle Laird, Supervising
Deputy Attorney General; Paras Hrishikesh Modha, Deputy
Attorney General; Timothy M. Muscat, Deputy Attorney
General; Office of the Attorney General, Sacramento,
California; for Defendants-Appellees.

OPINION

BADE, Circuit Judge:

This action arose from negotiations for a new tribal-state
compact between Plaintiff-Appellant Pauma Band of
Luiseno Mission Indians of the Pauma and Yuima
Reservation (“Pauma”) and Defendants-Appellees the State
of California and the Governor of the State of California
4 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

(collectively, the “State”). In a well-reasoned decision, the
district court held that the State satisfied its obligation to
negotiate in good faith under the Indian Gaming Regulatory
Act (“IGRA”) and entered judgment in favor of the State on
twenty of Pauma’s twenty-two claims. We agree with the
district court that the State agreed to negotiate for the new
types of class III gaming that Pauma sought authorization to
offer, actively engaged in the negotiations, and remained
willing to continue the negotiations when Pauma filed this
litigation. We have jurisdiction under 28 U.S.C. § 1291, and
we affirm.

I

IGRA “strike[s] a delicate balance between the
sovereignty of states and federally recognized Native
American tribes” with respect to gaming on tribal land.
Pauma Band of Luiseno Mission Indians of Pauma & Yuima
Rsrv. v. California (“Pauma”), 813 F.3d 1155, 1160 (9th Cir.
2015); see Michigan v. Bay Mills Indian Cmty., 572 U.S.
782, 785 (2014). IGRA separates tribal gaming into three
general “classes,” each with progressively restrictive
regulations. See Seminole Tribe of Fla. v. Florida, 517 U.S.
44, 48 (1996). Class III gaming “includes the types of high-
stakes games usually associated with Nevada-style
gambling,” Coyote Valley Band of Pomo Indians v.
California (In re Gaming Related Cases) (“Coyote Valley”),
331 F.3d 1094, 1097 (9th Cir. 2003), and “is subjected to the
greatest degree of control under IGRA’s regulations,”
Pauma, 813 F.3d at 1160. A tribe may offer class III gaming
only pursuant to a tribal-state compact—an agreement
between the tribe and state authorizing and governing
gaming activities. See 25 U.S.C. § 2710(d); Rumsey Indian
Rancheria of Wintun Indians v. Wilson (“Rumsey”), 64 F.3d
1250, 1256 (9th Cir. 1994).
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 5

When a state receives a tribe’s request to negotiate a
compact to permit class III gaming, it “shall negotiate with
the Indian tribe in good faith to enter into such a compact.”
25 U.S.C. § 2710(d)(3)(A). Although IGRA does not define
“good faith,” it provides that courts “may” consider “the
public interest, public safety, criminality, financial integrity,
and adverse economic impacts on existing gaming
activities” when evaluating whether a state negotiated in
good faith and “shall consider any demand by the State for
direct taxation of the Indian tribe or of any Indian lands as
evidence” of bad faith. Id. § 2710(d)(7)(B)(iii). A compact
may include “provisions relating to” various terms,
including application of criminal and civil laws, allocation
of criminal and civil jurisdiction, assessments, taxation,
remedies, and operational standards. Id. § 2710(d)(3)(C)(i)–
(vii).

We analyze bad faith claims under IGRA’s burden-
shifting standard. The tribe bears the initial burden of
“introduc[ing] . . . evidence” that: (1) “a Tribal-State
compact has not been entered into” and (2) the state either
failed to respond to the tribe’s request “in good faith” or
failed to respond altogether. Id. § 2710(d)(7)(B)(ii)(I)–(II).
If that evidentiary showing is made, the burden shifts to the
state to establish that it “negotiated with the Indian tribe in
good faith to conclude a Tribal-State compact governing the
conduct of gaming activities.” Id. § 2710(d)(7)(B)(ii).

If a state fails to negotiate in good faith, IGRA affords a
multi-step judicial remedy. First, the court must order the
state and tribe to approve “a compact within a 60-day
period.” Id. § 2710(d)(7)(B)(iii). Second, if those
negotiations are unsuccessful, the parties shall “submit to a
mediator appointed by the court a proposed compact that
represents their last best offer for a compact,” and the
6 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

mediator must select the proposal that “best comports with
the terms” of IGRA. Id. § 2710(d)(7)(B)(iv). In the third
and final step, “[i]f the State does not accept the mediator’s
chosen compact within 60 days, the Secretary of the Interior
shall prescribe, consistent with the mediator’s chosen
compact and with the terms of IGRA, the conditions upon
which the tribe may engage in class III gaming.” Coyote
Valley, 331 F.3d at 1098 (citing 25 U.S.C.
§ 2710(d)(7)(B)(vii)).

“[T]he function of the good faith requirement and
judicial remedy is to permit the tribe to process gaming
arrangements on an expedited basis, not to embroil the
parties in litigation over their subjective motivations.”
Rincon Band of Luiseno Mission Indians v. Schwarzenegger
(“Rincon”), 602 F.3d 1019, 1041 (9th Cir. 2010). As a
result, we evaluate good faith “objectively based on the
record of negotiations.” Id.; see also Coyote Valley,
331 F.3d at 1113 (“[T]he good faith inquiry is nuanced and
fact-specific, and is not amenable to bright-line rules.”).

We have indicated that a state is not guilty of procedural
bad faith if it “remained willing to meet with the tribe for
further discussions.” Coyote Valley, 331 F.3d at 1110.
Similarly, a state does not engage in bad faith simply
because “it takes a ‘hard line’ negotiating position” with a
tribe. Rincon, 602 F.3d at 1038. “[A] ‘hard line’ stance is
not inappropriate so long as the conditions insisted upon are
related to legitimate state interests regarding gaming and the
purposes of IGRA.” Id. at 1039 (emphasis omitted).
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 7

II

A

The California Constitution generally prohibits lotteries.
Section 19(a) provides: “The Legislature has no power to
authorize lotteries, and shall prohibit the sale of lottery
tickets in the State.” Cal. Const. art. IV, § 19(a); see Cal.
Penal Code §§ 320–326. Nonetheless, the California
Constitution authorizes “the establishment of a California
State Lottery.” Id. § 19(d).

The corresponding Lottery Act creates the California
State Lottery, which is limited to operating “lottery games.”
Lottery game “means any procedure authorized by the [State
Lottery Commission] whereby prizes are distributed among
persons who have paid, or who have unconditionally agreed
to pay, for tickets or shares which provide the opportunity to
win those prizes.” Cal. Gov’t Code § 8880.12. “The Lottery
Act’s only express limitations on the types of lottery games
the commission may authorize are contained in [California]
Government Code section 8880.28.” W. Telcon, Inc. v. Cal.
State Lottery, 917 P.2d 651, 654 (Cal. 1996). These
limitations include that “[n]o lottery game may use the
theme of roulette, dice, baccarat, blackjack, Lucky 7s, draw
poker, slot machines, or dog racing,” and that “[i]n games
utilizing computer terminals or other devices, no coins or
currency shall be dispensed as prizes to players from these
computer terminals or devices.” Cal. Gov’t Code
§ 8880.28(a)(1), (3).

In March 2000, the voters of California amended the
California Constitution to authorize Indian tribes to operate
three forms of class III gaming in reservation casinos: slot
machines, banking and percentage card games, and lottery
games. As amended, the California Constitution provides:
8 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

[T]he Governor is authorized to negotiate and
conclude compacts, subject to ratification by
the Legislature, for the operation of slot
machines and for the conduct of lottery
games and banking and percentage card
games by federally recognized Indian tribes
on Indian lands in California in accordance
with federal law. Accordingly, slot
machines, lottery games, and banking and
percentage card games are hereby permitted
to be conducted and operated on tribal lands
subject to those compacts.

Cal. Const. art. IV, § 19(f).

B

In May 2000, Pauma and the State executed what is
commonly known as the 1999 Compact, a nine-page
document prescribing, inter alia, the types of class III
gaming that Pauma could offer. As one type of class III
gaming, Section 4.1(c) of the 1999 Compact authorized
Pauma to operate “any devices or games that are authorized
under state law to the California State Lottery, provided that
the Tribe will not offer such games through use of the
Internet unless others in the state are permitted to do so under
state and federal law.”

In 2004, Pauma and the State negotiated an amendment
to the 1999 Compact authorizing Pauma to operate more
machines in exchange for higher fees to the State. See
Pauma, 813 F.3d at 1161–62. Lengthy litigation ensued, and
in 2015, this court affirmed the district court’s judgment
rescinding the amendment and awarding $36.2 million to
Pauma. See id. at 1173. With the 2004 amendment
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 9

rescinded, the 1999 Compact became the sole operative
agreement governing Pauma’s gaming activities.

In November 2014, Pauma notified the State that it
wanted to renegotiate the 1999 Compact pursuant to
Section 12.2 of the 1999 Compact and the then-enforceable
2004 amendment. In its letter, Pauma identified two new
types of class III gaming that it sought authorization to offer:
(1) on-track horse racing and wagering and (2) an expanded
set of lottery games. Specifically, Pauma wanted to
“supplement the lottery games it offers by obtaining the right
to conduct any games that are not currently authorized under
State law to the California State Lottery.” The State agreed
to negotiate for the two new types of gaming, and the parties
arranged an in-person meeting to discuss the scope of the
negotiations.

The parties met for the first time in January 2015.
Although they did not record the meeting, the parties
exchanged letters—spanning from early to mid-2015—
memorializing the meeting. The parties disputed some
details of the meeting but agreed that Pauma expressed no
interest in the State’s suggestion that Pauma add off-track
wagering to its plans. The parties also agreed that Pauma
declined to furnish details about its plans for an on-track
facility.

The parties anticipated meeting a second time in May
2015, but Pauma asked that the meeting be delayed so its
attorneys could prepare for oral argument in the parties’
other litigation. The State agreed, and the parties scheduled
a second meeting in early September 2015. This meeting
was recorded, and the parties included a transcript in the
joint record of negotiations.
10 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

The transcript of the second meeting shows that the
Executive Director of the California Horse Racing Board
attended, at the State’s request, to lend insight into the
nuances of on-track horse racing and wagering. The
Executive Director provided general background
information about on-track horse racing, answered general
questions from Pauma about various state regulations, and
advised Pauma that a new track had not been built in
California for approximately sixty years. The Executive
Director advised Pauma that an on-track facility would be
“very well received” because the industry was “declining”
and tracks were “closing.”

The record also shows that the State reiterated its request
that Pauma supply specific details about the two new types
of class III gaming it sought and to propose compact
language. The State explained that, in its negotiations with
other tribes, the parties usually circulated written proposals,
which allowed for interim analysis and written responses.
After some initial hesitancy, Pauma stated that it had “no
problem drafting the language” and would get its proposed
language to the State “quick.”

The State also inquired if it could review Pauma’s
“business plan” for the on-track racing facility to understand
the scope of the operation. Pauma declined, explaining that
it wanted to discuss whether to disclose the plan and that it
was “reluctant” to share detailed information with the State.
Pauma’s attorneys noted that they were “newbies” in horse
racing and disputed the State’s position that Pauma should
first identify what it “had in mind” for an on-track facility.
Pauma also changed its mind and agreed with the State’s
recommendation to offer off-track wagering.

A new dispute emerged during the second meeting over
the scope of the negotiations. The State understood that the
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 11

negotiations were limited to the two new types of gaming
identified in Pauma’s November 2014 letter (i.e., on-track
horse racing and additional lottery games), while Pauma
believed that the entire 1999 Compact was on the table.
Throughout the fall of 2015, the parties exchanged
correspondence addressing the scope of the negotiations.
And in November 2015, Pauma triggered the 1999
Compact’s dispute resolution process.

During this time, the State contacted the National Indian
Gaming Commission to inquire about on-track horse racing
and wagering compacts across the country. The State
learned that such compacts were “rare” but obtained a
compact addendum that had been approved by the Secretary
of the Interior. In November 2015, the State sent Pauma that
compact addendum, titled “Pari-Mutuel Racing Addendum
to Gaming Compact Between the Sisseton-Wahpeton Sioux
Tribe and the State of North Dakota.” Around the same time,
the State circulated a draft off-track wagering addendum that
would authorize Pauma to develop a satellite wagering
facility.

Because of their continuing rift about the scope of the
negotiations, the parties met for an in-person dispute
resolution in December 2015. Soon after the meeting, the
State sent a letter to Pauma reaffirming its position on the
scope of the negotiations but, in an effort to move
negotiations forward, agreeing to negotiate for a new or
amended compact pursuant to Section 12.1. In January
2016, the State confirmed its agreement to renegotiate the
1999 Compact in full and told Pauma that it “look[ed]
forward” to receiving a draft compact from Pauma as well as
Pauma’s “plans for on-track betting.”

Rather than propose a draft compact or disclose any
information about the on-track facility, Pauma changed tack.
12 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

In late January 2016, Pauma notified the State that it wanted
to separately negotiate each item of the compact so the
parties could “seek court guidance” along the way. To
commence the new approach, Pauma proposed
modifications to the 1999 Compact’s lottery game language.

The State responded in March 2016. Citing negotiating
efficiency, limitations on the negotiation process, and lack
of a legal basis in IGRA, the State rejected Pauma’s
piecemeal negotiation approach. The State also rebuffed
Pauma’s lottery game language and advised that although it
understood its authority to negotiate lottery games to be
limited to those games offered by the California State
Lottery (the “Lottery”), it would negotiate for games beyond
that scope if the compact enumerated the games. Identifying
the games, according to the State, would clarify the scope of
the authorization, avoid future disputes, and reduce the risk
of violating lottery regulations. Finally, because Pauma
failed to do so, the State advised that it would send a
“complete draft compact to guide our future discussions.”

In April 2016, the State circulated a “draft compact,”
titled “Pauma State’s Draft Proposed Compact,” for
Pauma’s “consideration” and asked Pauma to “let us know
when you would like to discuss.” The lengthy draft
(approximately 140 pages) addressed a broad array of topics
and included comments in the margins to highlight certain
issues requiring further negotiation. For example, one
comment noted that the State remained “open, as indicated
in prior correspondence, to discussion regarding the
authorization of additional enumerated games.” In another,
the State wrote that it “has proposed OTW [off-track
wagering] compact that can be incorporated as an Appendix
or negotiated and concluded as a separate class III gaming
compact.”
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 13

Pauma never responded. Instead, it filed this lawsuit a
few months later. On cross-motions for summary judgment,
the district court held that the State negotiated in good faith,
and it entered judgment in favor of the State on twenty of
Pauma’s claims under Federal Rule of Civil Procedure
54(b). Pauma appeals.

III

We review de novo an order on cross-motions for
summary judgment and evaluate “each motion separately,
giving the nonmoving party in each instance the benefit of
all reasonable inferences.” A.C.L.U. of Nev. v. City of Las
Vegas, 466 F.3d 784, 790–91 (9th Cir. 2006) (internal
quotation marks omitted). Summary judgment is
appropriate if, after viewing the evidence in the light most
favorable to the nonmoving party, no genuine issue of
material fact exists. Frudden v. Pilling, 877 F.3d 821, 828
(9th Cir. 2017). We review de novo whether a state
negotiated for a tribal-state compact in good faith. Rincon,
602 F.3d at 1026 (citing Coyote Valley, 331 F.3d at 1107).

IV

The crux of this appeal is Pauma’s belief that the State
stalled during negotiations and proposed a woefully
inadequate draft compact. Before analyzing the claims,
however, we first address Pauma’s argument that the district
court improperly created an “impasse” defense to bad faith
claims. In its decision, the district court observed that “all
of Pauma’s claims encounter the same problem” and “appear
premature” because the negotiations had not “reached an
impasse.” But the district court did not base its decision on
whether the negotiations were at an impasse. Rather, it
proceeded to analyze the record of negotiations for each
individual claim and reinforced its conclusion that the State
14 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

negotiated in good faith by underscoring that the State
remained willing to continue meeting and negotiating with
Pauma. The state of negotiations at the commencement of a
lawsuit is certainly a relevant factor for courts to consider
when analyzing bad faith claims under IGRA, see Coyote
Valley, 331 F.3d at 1109–10, and the district court did not
err in doing so here.

A

In Count 1, Pauma alleges that the State engaged in a
procedural form of bad faith: surface bargaining. According
to Pauma, the State evaded real negotiations for lottery
games by chronically feigning ignorance of Pauma’s
requests.

The record belies Pauma’s characterization. To avoid
future litigation, the State repeatedly asked Pauma to
describe the scope of the additional lottery games that it
sought to offer, to clearly describe those games, and to
submit draft compact language. Although Pauma finally
advanced lottery game language in January 2016, it
simultaneously altered the format of the negotiations by
proposing—for the first time—that the parties negotiate each
part of the compact separately. The State declined to
negotiate in a piecemeal manner and rejected Pauma’s
proposed language. The State agreed, however, to negotiate
for lottery games beyond those authorized for the California
State Lottery if the compact enumerated the games. The
State then circulated a draft compact highlighting that topic
for further negotiation, but Pauma never responded.

We agree with the district court that no genuine dispute
exists on whether the State engaged in bad faith by surface
bargaining. “Lottery game” is a statutorily defined term with
subtle parameters. See Cal. Gov’t Code §§ 8880.12,
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 15

8880.28(a)(1), (3); W. Telcon, Inc., 917 P.2d at 658–63
(holding that the “CSL Keno” game operated by the Lottery
was a “house-banked game” and therefore an unlawful
activity because it did not meet the definitions of “lottery
game” under California Government Code § 8880.12 or
“lottery” under California Penal Code § 319). It was not bad
faith for the State to request specific language to prevent
inadvertent approval of unlawful lottery games. Again,
because Pauma failed to respond to the State’s position, the
parties did not further explore each other’s views on this
issue. We abstain from inserting ourselves into incomplete
negotiations. See Coyote Valley, 331 F.3d at 1110
(concluding that state did not negotiate in procedural bad
faith because it “remained willing to meet with the tribe for
further discussions”). 1

Pauma compares this case to Mashantucket Pequot Tribe
v. Connecticut, 913 F.2d 1024 (2d Cir. 1990). But unlike the
State of California here, the State of Connecticut there did
not meet with the tribe in person, contact outside experts,
circulate model compact addendums, or propose a draft
compact. To the contrary, the State of Connecticut acted in
bad faith by falsely promising that it would “appoint[] a task
force or negotiating team.” Mashantucket Pequot Tribe,
913 F.2d at 1024, 1027–28; see also Cabazon Band of
Mission Indians v. Wilson, 124 F.3d 1050, 1056 (9th Cir.
1997) (“We agree that Congress, in passing IGRA, did not
create a mechanism whereby states can make empty
promises to Indian tribes during good-faith negotiations of
Tribal-State compacts . . . .”). Thus, Pauma’s reliance on

1
This is not to say that a state can never engage in bad faith by
surface bargaining. But under the objective circumstances of this case,
the State did not do so here.
16 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

Mashantucket Pequot Tribe is misplaced; the record here
reflects extensive efforts by the State, not empty promises.

B

In Count 2, Pauma alleges that the State negotiated in
bad faith by taking actions designed to protect the Lottery’s
revenues. In support, Pauma directs us to a single comment
from one in-person meeting, when the State’s representative
noted that the monies earned by the Lottery support
childhood education in California. But that statement was
merely a factual response to Pauma’s impromptu spurring of
the issue. The State confirmed that it was not engaging in
protectionism, and it agreed to negotiate for new lottery
games beyond those offered by the Lottery. As the district
court observed, “[i]f agreeing to negotiate to allow Pauma to
offer new games beyond [those] conducted by the California
State Lottery is part of the State’s protectionist strategy, it is
a poor one.”

C

Pauma alleges in Count 3 that the State negotiated in bad
faith regarding Pauma’s request to offer on-track horse
racing and wagering because the State refused to discuss on-
track horse wagering during the second meeting, declined to
negotiate the terms of a new compact piecemeal, and
circulated a draft compact. The record, which we consider
as a whole, see Rincon, 602 F.3d at 1041, fails to support this
claim.

The record shows that although the State had never
previously negotiated over this form of gaming, it repeatedly
expressed its willingness to do so with Pauma. To that end,
the State asked Pauma during the first meeting to supply
details about its envisioned on-track facility. Pauma refused.
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 17

During the second meeting, the State again asked Pauma for
more details about its facility, including the business plan
Pauma had developed. Pauma refused. After the second
meeting, the State repeated its request for clear and specific
information regarding the on-track facility. Still, Pauma
disclosed nothing. Meanwhile, the State brought the
Executive Director of the California Horse Racing Board to
the second meeting, obtained a sample addendum for on-
track racing from the National Indian Gaming Commission,
and circulated a draft compact addendum for a satellite off-
track wagering facility.

The State actively participated in the negotiations and
tried to advance the negotiations. True, the State was
reluctant to finalize compact language during the second
meeting, but it encouraged Pauma to circulate draft language
so it could analyze the information and respond in writing.
The record is replete with examples of the State’s fruitless
requests that Pauma provide specific details about its
envisioned on-track facility. Moreover, Pauma filed this
action without ever commenting on the State’s sample
compact from North Dakota, its draft off-track wagering
addendum, or its draft compact. A state’s duty to negotiate
in good faith does not compel blind negotiation, and nothing
in the record shows that the State negotiated in bad faith over
on-track horse racing and wagering. 2

2
To the extent Pauma claims that the State engaged in bad faith by
declining to separately negotiate each compact term, we reject the claim.
Pauma cites no binding authority requiring a state to negotiate a compact
line-by-line or consent to a tribe’s favored negotiation format.
18 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

D

In Counts 4 through 8, Pauma claims that the State acted
in bad faith by refusing to negotiate for specific types of
additional lottery games: (a) those games not authorized for
the Lottery (Count 4), (b) video lottery terminals (Count 5),
(c) video lottery terminals that dispense coins or currency
(Count 6), (d) games based on a tribal lottery system (Count
7), and (e) games authorized to the Multi-State Lottery
Association or any other state (Count 8). And in Count 9,
Pauma asserts that the State violated its good faith duties by
failing to substantiate its position for additional lottery
games.

We agree with the district court that summary judgment
is proper on Counts 4 through 8 because the State agreed to
negotiate for additional lottery games, including games not
authorized for the Lottery, and reasonably requested that
such games be enumerated in the compact. Pauma argues
that the State should have permitted it to offer all lottery
games beyond the Lottery’s authorization. But this misses
the point and ignores Pauma’s failure to respond to the
State’s position. Although the State indicated concern that
its authority to negotiate extended only to those games
authorized for the Lottery, it agreed to negotiate for games
beyond that limit if the compact listed the games. Pauma
spurned this channel of negotiation by failing to respond.
Before litigating the substance of the State’s bargaining
position, Pauma needed to at least raise its objections with
the State. 3

3
Pauma’s comparison of this case to Northern Arapaho Tribe v.
Wyoming, 389 F.3d 1308 (10th Cir. 2004), is not persuasive. Unlike the
State of Wyoming’s refusal to negotiate for games beyond the bounds of
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 19

The district court also properly entered summary
judgment on Count 9, Pauma’s claim that the State failed to
substantiate its negotiating position. The record establishes
that the State substantiated its request to enumerate the
games in the compact by identifying various interests,
including clarifying the scope of the authorization, avoiding
future disputes, and mitigating the risk of violating
regulations. But even if the State had not provided these
reasons, Pauma cites no authority that failing to substantiate
a bargaining position constitutes bad faith under IGRA. 4 So
long as the bargaining position itself does not violate IGRA,
the obligation to negotiate in good faith does not require
states, in every circumstance, to furnish specific reasons for
every position taken during negotiations.

E

In Count 10, Pauma alleges that the State acted in bad
faith by refusing to renegotiate the 1999 Compact in full and
by conflating “amendment” under Section 12.1 with

state law, see N. Arapaho Tribe, 389 F.3d at 1312–13, the State of
California did not tether its position on the lottery game issue to its
understanding of California law. Indeed, despite its understanding of its
authority under California law, the State of California agreed to negotiate
for games beyond those authorized for the Lottery.
4
Pauma cites National Labor Relations Board v. Truitt
Manufacturing Co., 351 U.S. 149, 152–53 (1956), to support its claim
that the State needed to substantiate its position. But that case did not
involve IGRA, and the Court expressly declined to hold that
“substantiating evidence” for a bargaining position is required “in every
case.” Nat’l Labor Relations Bd., 351 U.S. at 153. The Court instead
explained that “[e]ach case must turn upon its particular facts” and “[t]he
inquiry must always be whether or not under the circumstances of the
particular case the statutory obligation to bargain in good faith has been
met.” Id. at 153–54.
20 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

“renegotiation” under Section 12.2. 5 According to Pauma,
the State manipulated the distinction between mandatory
renegotiation under Section 12.2 and voluntary amendment
under Section 12.1 in an attempt to obtain improper benefits
and to forego discussion of additional gaming rights.

We disagree. The State agreed to renegotiate the entirety
of the 1999 Compact just two months after Pauma raised the
issue in September 2015. And even during the dispute over
the scope of the negotiations, the State continued to engage
Pauma on its requests for new gaming rights. Any minor
delay the State caused by believing that the negotiations
were limited to the two games identified in Pauma’s original
letter does not establish bad faith. See Coyote Valley Band
of Pomo Indians v. California (In re Indian Gaming Related
Cases), 147 F. Supp. 2d 1011, 1015 (N.D. Cal. 2001), aff’d,
331 F.3d 1094 (9th Cir. 2003).

Pauma’s reliance on Idaho v. Shoshone-Bannock Tribes,
465 F.3d 1095 (9th Cir. 2006), does not salvage this claim.
There, the State of Idaho argued that the parties needed to
renegotiate an entire compact to reach a “necessary
amendment,” despite the compact separately defining
“amendment” and “renegotiation.” See Shoshone-Bannock
Tribes, 465 F.3d at 1099. In contrast, the State of California
agreed to do what Pauma wanted: renegotiate the entire
1999 Compact, including for the two new types of class III
gaming. And unlike the State of Idaho, the State of
California did not demand additional payments in exchange
5
Section 12.1 provides that “[t]he terms and conditions of this
Gaming Compact may be amended at any time by the mutual and written
agreement of both parties.” Section 12.2 provides that “[t]his Gaming
Compact is subject to renegotiation in the event the Tribe wishes to
engage in forms of Class III gaming other than those games authorized
herein and requests renegotiation for that purpose . . . .”
 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL. 21

for authorization to offer the new types of gaming, see id. at
1101–02, nor did it manipulate the terms of the compact to
advance a self-serving agenda.

F

The final ten claims are based on the State’s April 2016
draft compact proposal. Pauma alleges in Count 11 that the
State failed to afford individualized negotiations because the
draft was similar to a compact the State executed with
another tribe. But the State made clear that its proposal was
only the next step in the negotiations. The State previously
told Pauma that circulating written drafts was routine in
compact negotiations and encouraged Pauma to propose a
first draft. Pauma never did. The State’s decision to
circulate a proposed draft compact for future discussions
does not evidence bad faith; instead it demonstrates a proper
motivation: the State endeavored to move the negotiations
toward the finish line. See Mashantucket Pequot Tribe,
913 F.2d at 1033 (“[T]he manifest purpose of [IGRA] is to
move negotiations toward a resolution . . . .”). 6

In Counts 12 through 20, Pauma alleges that the State
negotiated in bad faith by including “unduly harsh” language
in the draft compact. These claims are subject to summary
judgment for the same reason as Count 11: the draft compact
was just that, a draft. The State openly identified areas that
needed further negotiation and, before sending the draft,
advised Pauma that the document was meant to guide future
discussions. The State did not throw in the towel as Pauma

6
We reject Pauma’s attempt to construe this first proposed draft as
the State’s final offer. The letter circulating the draft compact and the
draft itself clearly establish that the document was a draft, not a take-it-
or-leave-it offer.
22 PAUMA BAND OF LUISENO MISSION INDIANS V. STATE OF CAL.

insists—it was Pauma that refused to engage with the State
any further. We will not probe the details of a nearly 140-
page draft compact that Pauma never discussed with the
State.

V

The record shows that the State participated in multiple
in-person meetings with Pauma and agreed to negotiate for
the additional types of class III gaming. The State consulted
with multiple experts, obtained and disclosed a sample on-
track compact, and proposed a full draft compact to guide
the parties’ future discussions. Because the State “remained
willing to meet with the tribe for further discussions” and
“actively negotiated,” the district court properly granted the
State’s motion, denied Pauma’s motion, and entered
judgment for the State. See Coyote Valley, 331 F.3d at 1110.

AFFIRMED.