United States Court of Appeals
Fifth Circuit
F I L E D
REVISED SEPTEMBER 13, 2007
August 17, 2007
UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT Charles R. Fulbruge III
Clerk
_______________________
No. 05-50754
_______________________
STATE OF TEXAS,
Plaintiff-Appellant,
versus
UNITED STATES OF AMERICA; UNITED STATES DEPARTMENT
OF THE INTERIOR; DIRK KEMPTHORNE, in his Official Capacity
as Secretary of the Department of the Interior,
Defendants-Appellees,
KICKAPOO TRADITIONAL TRIBE OF TEXAS,
Intervenor-Defendant-Appellee.
Appeal from the United States District Court
for the Western District of Texas
Before JONES, Chief Judge, and KING and DENNIS, Circuit Judges.
EDITH H. JONES, Chief Judge:
This is high-stakes litigation involving a challenge to
procedures adopted by the Secretary of the Interior Department
(“Secretary”) to circumvent the consequences of the Supreme Court’s
Eleventh Amendment decision in Seminole Tribe of Florida v.
Florida, 517 U.S. 44, 116 S. Ct. 1114 (1996). An initial question
is whether Texas’s challenge to the existence of the Secretarial
Procedures is ripe now, before the Secretary has made a substantive
determination on a tribe’s Class III gaming license. We hold that
the case is ripe, the State has standing, and the Secretary lacked
authority to promulgate the regulations. The district court’s
judgment is REVERSED and REMANDED.
I. BACKGROUND
In the 1980s, various Indian tribes began to seek
authority for legalized gambling as a way to earn revenue. As
sovereigns, Indian tribes are subordinate only to the federal
government. California v. Cabazon Band of Mission Indians,
480 U.S. 202, 207, 107 S. Ct. 1083, 1087 (1987). State laws,
however, “may be applied to tribal Indians on their reservations if
Congress has expressly so provided.” Id. In Cabazon, the Supreme
Court held that because Congress had not so expressly provided,
California could not enforce certain anti-gambling laws against an
Indian tribe there. Id. at 214, 221-22, 107 S. Ct. at 1091,
1094-95.
In response to Cabazon, Congress enacted the Indian
Gaming Regulatory Act (“IGRA”), 25 U.S.C. § 2701 et seq., to give
states a subordinate but significant role in regulating tribal
gaming. IGRA separates gaming into classes of escalating stakes.
Class I gaming – social games played for minimal value – is within
the exclusive jurisdiction of the tribes. 25 U.S.C. §§ 2703(6),
2710(a)(1). Class II gaming – bingo and related activities – is
subject to oversight by the National Indian Gaming Commission.
2
25 U.S.C. §§ 2703(7), 2706(b), 2710(a), (b) & (c). All other forms
of gaming, including high-stakes games such as slot machines,
casino games, lotteries, and dog racing, are Class III. 25 U.S.C.
§ 2703(8).
Class III gaming, if authorized by the tribe, must be
“conducted in conformance with a Tribal-State compact entered into
by the Indian Tribe and the State.” 25 U.S.C. § 2710(d)(1). In
IGRA, Congress meticulously detailed two separate tracks leading to
the institution of a Class III tribal gaming business. On the
first track, the tribe and the state may negotiate a voluntary
compact governing the conduct of gaming activities, which takes
effect essentially upon approval by the Secretary.
§ 2710(d)(3)(B).
The second track begins when no compact has been reached
one hundred eighty days after the tribe requests negotiations.
IGRA then allows a tribe to file suit against the state in federal
court and seek a determination whether the state negotiated in good
faith. § 2710(d)(7). If the court finds the state negotiated in
good faith, the tribe’s proposal fails. On a finding of lack of
good faith, however, the court may order negotiation, then
mediation. If the state ultimately rejects a court-appointed
mediator’s proposal, the Secretary “shall prescribe, in consulta-
tion with the Indian tribe, procedures . . . under which class III
gaming may be conducted.” § 2710(d)(7)(B).
3
The Supreme Court held this second track of the
congressional scheme flawed under the Eleventh Amendment, because
Congress has no authority to abrogate a state’s sovereign immunity
from suit under the Indian Commerce Clause of Article I of the
Constitution. See Seminole Tribe, 517 U.S. at 47, 116 S. Ct. at
1119. Following Seminole Tribe, a state may waive immunity from
suit, or the United States may sue the state to obtain the
statutory good-faith determination, but a state cannot be forced to
submit to the tribe’s suit. Seminole Tribe made the second track
toward Class III gaming far more difficult to pursue.
To work around the decision, the Secretary promulgated
notice-and-comment regulations in 1999. See Class III Gaming
Procedures, 25 C.F.R. pt. 291 (“Secretarial Procedures” or
“Procedures”). The Secretarial Procedures only apply if the state
asserts its sovereign immunity and refuses to consent to a tribe’s
statutory good-faith suit. 25 C.F.R. §§ 291.1(b), 291.3. In such
event, an eligible tribe may submit a Class III gaming proposal to
the Secretary, who then affords the state sixty days to comment and
submit an alternative proposal. 25 C.F.R. § 291.7. At that point,
the Secretarial Procedures prescribe two tracks depending on
whether the state chooses to submit an alternative compact
proposal.
If the state does not submit an alternative proposal, the
Secretary reviews the tribe’s proposal and either approves it or
offers the opportunity for a conference between the state and the
4
tribe to address “unresolved issues and areas of disagreements in
the proposal.” 25 C.F.R. § 291.8. The Secretary must then make a
“final decision either setting forth the Secretary’s proposed
Class III gaming procedures for the Indian tribe, or disapproving
the proposal.” Id.
If the state submits an alternative plan, the Secretary
appoints a mediator who, following the same procedures as IGRA
prescribes, will resolve differences between the two proposals.
25 C.F.R. §§ 291.9, 291.10. While, under the Procedures, the
Secretary may reject the mediator’s proposal, he “must prescribe
appropriate procedures within 60 days under which Class III gaming
may take place.” 25 C.F.R. § 291.11 (emphasis added).
The difference between IGRA and the Secretarial
Procedures is that IGRA compels appointment of a mediator by the
court only after a judicial finding that the state failed to
negotiate in good faith, but under the Secretarial Procedures, the
gaming proposal goes forward without any judicial bad-faith
determination if the state refuses to waive sovereign immunity.
The Secretarial Procedures, in sum, offer two alternatives for a
state that insists upon its sovereign immunity: refuse to
negotiate, participate (or not) in an informal conference, and take
a chance that the Secretary will not accept the tribe’s Class III
gaming proposal, 25 C.F.R. § 291.8; or submit its “last best
proposal” to a mediator, with the certainty that Class III gaming
5
must be approved on the mediator’s or the Secretary’s terms.
25 C.F.R. § 291.11.
In 1995, the Kickapoo Traditional Tribe of Texas (the
“Kickapoo”) petitioned the State to enter into a compact
facilitating Class III gaming on its land. Texas rejected the
Kickapoos’ offer. The tribe’s federal lawsuit against Texas was
eventually dismissed under Seminole Tribe. In 2004, the Kickapoo
submitted a proposal to the Secretary, who followed the Secretarial
Procedures and invited Texas to comment. Texas responded with
this lawsuit asking the court to declare the Secretarial Procedures
unauthorized and unconstitutional.
II. STANDARDS OF REVIEW
This court reviews a district court’s legal conclusions,
including the decision whether to grant a summary judgment motion,
de novo. Garcia v. LumaCorp, Inc., 429 F.3d 549, 553 (5th Cir.
2005). Jurisdictional issues such as ripeness and standing, as
well as questions of statutory interpretation, are also legal
questions for which review is de novo. See Bonds v. Tandy,
457 F.3d 409, 411 (5th Cir. 2006) (standing); Groome Res. Ltd.,
L.L.C., v. Parish of Jefferson, 234 F.3d 192, 198-99 (5th Cir.
2000) (ripeness); In re Reed, 405 F.3d 338, 340 (5th Cir. 2005)
(statutory interpretation). A district court’s factual findings,
including those on which the court based its legal conclusions, are
6
reviewed for clear error. See Rivera v. Wyeth-Ayerst Labs.,
283 F.3d 315, 319 (5th Cir. 2002).
III. DISCUSSION
The district court determined in a thoughtful opinion
that Texas had standing to sue, but that the State’s claims were
not ripe for adjudication. See Order on Defendants’ Motion to
Dismiss, Kickapoo Traditional Tribe of Texas v. State of Texas,
Cause No. P-95-CA-66 (W.D. Tex. Apr. 2, 1996). The court thus
dismissed. Nevertheless, it also opined that the Secretary had
implied authority under IGRA and his general statutory
responsibility for Indian tribes to promulgate the Procedures.
Texas v. United States, 362 F. Supp. 2d. 765, 769-70 (W.D. Tex.
2004). The State appealed. Responding to the parties’ contentions
in this court, we conclude that Texas has standing to sue, that its
case is ripe, and that the Secretarial Procedures are unauthorized
by statute.
A. Justiciability
Appellees first contend that Texas has no standing to
seek invalidation of the Secretarial Regulations because Texas has
suffered no injury from the mere existence of the Secretarial
Procedures and, in any event, Texas brought any injury on itself by
raising a sovereign immunity defense to the Kickapoo Tribe’s
enforcement suit. Relatedly, Appellees argue that Texas’s claims
are not ripe because any injury that Texas could suffer from the
7
Procedures would only manifest if the Secretary were to prescribe
gaming procedures for the tribe at some point in the future. We
disagree with each contention.
The standing and ripeness doctrines flow largely from
Article III of the Constitution, which limits the federal judicial
power to the resolution of cases and controversies. Valley Forge
Christian Coll. v. Ams. United for Separation of Church and State,
Inc., 454 U.S. 464, 471, 102 S. Ct. 752, 757-58 (1982) (discussing
the underpinnings of standing doctrine). In general terms,
standing is concerned with whether a proper party is bringing suit,
while ripeness is concerned with whether the suit is being brought
at the proper time. See Elend v. Basham, 471 F.3d 1199, 1205 (11th
Cir. 2006). However, the doctrines often overlap in practice,
particularly in an examination of whether a plaintiff has suffered
a concrete injury, see id. at 1205, and our injury-in-fact analysis
draws on precedent for both doctrines.
1. Standing
“The ‘gist of the question of standing’ is whether the
party seeking relief has ‘alleged such a personal stake in the
outcome of the controversy as to assure that concrete adverseness
which sharpens the presentation of issues upon which the court so
largely depends for illumination of difficult . . . questions.’”
Flast v. Cohen, 392 U.S. 83, 99, 88 S. Ct. 1942, 1952 (1968)
(quoting Baker v. Carr, 369 U.S. 186, 204, 82 S. Ct. 691, 703
8
(1962)). To meet the constitutional standing requirements, (1) the
plaintiff must have suffered an “injury in fact,” defined as an
invasion of a legally protected interest that is (a) concrete and
particularized and (b) actual or imminent, not conjectural or
hypothetical; (2) there must be a causal connection between the
injury and the conduct complained of, such that the injury is
fairly traceable to the challenged action of the defendant; and
(3) it must be likely, not merely speculative, that the injury will
be redressed by a favorable decision. Lujan v. Defenders of
Wildlife, 504 U.S. 555, 560-61, 112 S. Ct. 2130, 2136 (1992).
Texas, as the party invoking federal jurisdiction, bears the burden
of establishing that the standing requirements are met. See id. at
561, 112 S. Ct. at 2136.
Texas alleges two ways in which the Secretarial
Procedures have caused it to suffer an injury in fact, contending
first that the existence of the Secretarial Procedures has reduced
the state’s bargaining power relative to that of the Kickapoo,1 and
second that the Secretarial Procedures subject Texas to a process
for approval of Class III gaming that omits IGRA’s procedural
safeguards and thus exceeds the Secretary’s regulatory authority.
The latter argument, in other words, is that Texas has suffered the
1
While the Supreme Court has held that the denial of a “statutory
bargaining chip” can “inflict[] a sufficient likelihood of economic injury to
establish standing,” Clinton v. City of New York, 524 U.S. 417, 432, 118 S. Ct.
2091, 2101 (1998), it is unclear whether a reduction in bargaining power
unaccompanied by economic injury or other concrete injury can constitute an
injury in fact. We do not reach this issue because Texas’s other alleged injury
in fact is sufficient to support standing.
9
injury of being compelled to participate in an invalid administra-
tive process, and we agree that standing exists on this basis.
At the outset of IGRA’s enforcement process, the statute
provides for tribe-initiated court review of a state’s good faith.
Once a tribe makes a prima facie showing, the state has the
opportunity to prove its good faith to the court and forestall the
remainder of the enforcement process, which includes court-ordered
mediation and possible secretarial approval of gaming procedures.
Texas interprets this as a statutory promise that states will be
spared mediation and secretarial action unless a court has
determined that the state negotiated in bad faith.
Contrary to Appellees’ suggestion that Texas faces
nothing more than the possibility that the Secretary might someday
approve of gaming procedures for Kickapoo land, Texas is presently
being subjected to an administrative process involving mediation
and secretarial approval of gaming procedures even though no court
has found that Texas negotiated in bad faith. Because Texas
challenges the Secretary’s authority to undertake this process,
Texas has alleged a sufficient injury for standing purposes. Cf.
Thomas v. Union Carbide Agric. Prods. Co., 473 U.S. 568, 580, 105
S. Ct. 3325, 3332 (1985) (holding that a challenge to a statutory
system of arbitration was ripe because the plaintiffs’ “injury
[was] not a function of whether the [arbitration] tribunal awards
reasonable compensation but of the tribunal’s authority to
adjudicate the dispute”); Middle S. Energy Inc. v. Ark. Pub. Serv.
10
Comm’n, 772 F.2d 404, 410 (8th Cir. 1985) (challenge to a state
agency’s ongoing proceedings was ripe because the plaintiff
“challenge[d] not the state’s ultimate substantive decision but its
authority to even conduct the contemplated proceeding”). The
alleged injury is not hypothetical because the Secretarial
Procedures have already been applied to Texas: The Kickapoo Tribe
submitted a Class III gaming application to the Department of the
Interior, the Secretary notified Texas and the tribe that the
application met the relevant eligibility requirements, and the
Secretary invited Texas to comment on the proposal and submit an
alternative proposal.2 Texas’s only alternative to participating
in this allegedly invalid process is to forfeit its sole oppor-
tunity to comment upon Kickapoo gaming regulations, a forced choice
that is itself sufficient to support standing. See Union Carbide,
473 U.S. at 582, 105 S. Ct. at 3333 (recognizing “the injury of
2
In accordance with the Secretarial Procedures, the Department of the
Interior informed the Kickapoo that their proposal was completed on December 11,
2003. See 25 C.F.R. § 291.6(b). On May 24, 2007, the Secretary issued a
preliminary “scope-of-gaming decision” in response to the tribe’s proposal.
According to the Secretary,
[t]he Tribe should be authorized to engage in the following gaming
activities under Class III procedures pursuant to 25 U.S.C.
§ 2710(d)(7)(B)(vii)(I), subject to the requirements discussed in
[the scope-of-gaming decision]: (1) traditional casino-style games;
(2) any lottery game including keno, numbers and lotto; and (3) off-
track pari-mutuel betting and pari-mutuel betting through
simulcasting on any gaming activity occurring off Tribal lands. The
Tribe is not authorized to operate gaming machines.
This recent, preliminary scope-of-gaming decision illustrates the concrete impact
of the choice that the Secretarial Procedures had forced Texas to make, as
Texas’s decision to forgo this allegedly invalid process has left it unable to
influence important decisions such as the type of gaming activities that the
Secretary will allow on Kickapoo land.
11
being forced to choose between relinquishing [the benefit of an
unlawful adjudicatory process] . . . or engaging in an unconstitu-
tional adjudication”). As the Supreme Court observed in Lujan,
[w]hen the suit is one challenging the legality of
government action or inaction . . . [and] the plaintiff
is himself an object of the action (or forgone action) at
issue . . . , there is ordinarily little question that
the action or inaction has caused him injury, and that a
judgment preventing or requiring the action will redress
it.
504 U.S. at 561-62, 112 S. Ct. at 2137. We are satisfied that
Texas has alleged an injury in this case.
The causation and redressability requirements for
standing are satisfied as well. The injury that Texas claims is
directly traceable to the Secretary’s applying the Secretarial
Procedures to Texas, and a judicial invalidation of the Secretarial
Procedures would give Texas direct relief from being effectively
forced to participate in this process. Although the United States
argues that Texas brought the injury on itself by invoking a
sovereign immunity defense, it provides no support for the
proposition that an injury cannot be fairly traceable to a
defendant if the plaintiff’s acts motivated the defendant to
undertake its injurious acts. The State did not cause the
Secretary of the Interior to promulgate the Secretarial Procedures,
nor did it cause the Secretary to apply the process to Texas. The
State’s sovereign immunity defense is a prerequisite to secretarial
action only because the Secretarial Procedures so provide.
12
Accordingly, Texas has standing to challenge the validity
of the Secretarial Procedures.
2. Ripeness
[The] basic rationale [of the ripeness
doctrine] is to prevent the courts, through
avoidance of premature adjudication, from
entangling themselves in abstract disagree-
ments over administrative policies, and also
to protect the agencies from judicial
interference until an administrative decision
has been formalized and its effects felt in a
concrete way by the challenging parties.
Abbott Labs. v. Gardner, 387 U.S. 136, 148-49, 87 S. Ct. 1507, 1515
(1967), overruled on other grounds, Califano v. Sanders, 430 U.S.
99, 97 S. Ct. 980 (1977). To determine if a case is ripe for
adjudication, a court must evaluate (1) the fitness of the issues
for judicial decision, and (2) the hardship to the parties of
withholding court consideration. See id. at 149. The fitness and
hardship prongs must be balanced, Am. Forest & Paper Ass’n v. EPA,
137 F.3d 291, 296 (5th Cir. 1998), and “[a] case is generally ripe
if any remaining questions are purely legal ones.” New Orleans
Pub. Serv., Inc. v. Council of the City of New Orleans, 833 F.2d
583, 587 (5th Cir. 1987). Yet “even where an issue presents purely
legal questions, the plaintiff must show some hardship in order to
13
establish ripeness.”3 Cent. & Sw. Servs. v. EPA, 220 F.3d 683, 590
(5th Cir. 2000).
A challenge to administrative regulations is fit for
review if (1) the questions presented are “purely legal one[s],”
(2) the challenged regulations constitute “final agency action,”
and (3) further factual development would not “significantly
advance [the court’s] ability to deal with the legal issues
presented.” Nat’l Park Hospitality Ass’n v. Dep’t of Interior,
538 U.S. 803, 812, 123 S. Ct. 2026, 2032 (2003) (internal quotation
marks and citations omitted); Abbott Labs., 387 U.S. at 149-54,
87 S. Ct. 1515-18. An additional consideration is “whether
resolution of the issues will foster effective administration of
the statute.” Merchs. Fast Motor Lines, Inc. v. ICC, 5 F.3d 911,
920 (5th Cir. 1993); Abbott Labs., 387 U.S. at 154, 87 S. Ct. at
1518.
Appellees do not dispute that the issues involved in this
case are purely legal, but their arguments with regard to the
remaining fitness principles are all based on the mistaken belief
that Texas’s alleged injury is the speculative harm that could
result if the Secretary were ultimately to approve gaming
procedures for Kickapoo land. As discussed in the standing
3
Texas relies on a case from another circuit for the proposition
that hardship is an issue only if a case is not fit for review. See Fla. Power
& Light v. EPA, 145 F.3d 1414, 1421 (D.C. Cir. 1998) (“When a challenged decision
is not ‘fit’ for review, the petitioner must show ‘hardship’ in order to overcome
a claim of lack of ripeness.”). We need not explore this contention here.
14
inquiry, this is incorrect, as Texas claims present injury from
submission to an invalid agency process, regardless whether the
Secretary ultimately allows gaming on Kickapoo land.
With this distinction in mind, Texas’s claims are fit for
adjudication. The challenged Secretarial Procedures are a “final
agency action,” as they are final rules that were promulgated
through a formal, notice-and-comment rulemaking process after
announcement in the Federal Register. See Abbott Labs., 387 U.S.
at 150-51, 87 S. Ct. at 1516-17. Additional fact-finding would not
aid our inquiry into the purely legal question of their validity.
And resolution of this issue now will give both the Secretary and
Congress significant guidance into how IGRA’s provisions may be
administered in the particular situation addressed in this case.
Appellees submit no relevant arguments as to why this issue is not
presently fit for judicial resolution.
We also agree with Texas that it would suffer hardship if
we were to withhold consideration of its claims. The Supreme Court
has found hardship to inhere in legal harms, such as the harmful
creation of legal rights or obligations; practical harms on the
interests advanced by the party seeking relief; and the harm of
being “force[d] . . . to modify [one’s] behavior in order to avoid
future adverse consequences.” Oh. Forestry Ass’n v. Sierra Club,
523 U.S 726, 734, 118 S. Ct. 1671 (1998). Texas faces this third
type of harm. If Texas cannot challenge the Procedures in this
15
lawsuit, the State is forced to choose one of two undesirable
options: participate in an allegedly invalid process that
eliminates a procedural safeguard promised by Congress, or eschew
the process with the hope of invalidating it in the future, which
risks the approval of gaming procedures in which the state had no
input. See Abbott Labs., 387 U.S. at 152, 87 S. Ct. at 1517
(finding hardship where administrative regulations forced the
plaintiffs either to comply with a challenged requirement and incur
significant costs or refuse to comply and risk prosecution); cf.
Union Carbide, 473 U.S. at 581, 105 S. Ct. at 3333 (finding
hardship where the plaintiffs “suffer[ed] the continuing
uncertainty and expense of depending for compensation on a process
whose authority is undermined because its constitutionality is in
question”).
We therefore agree with Texas that its challenge to the
Secretarial Regulations is ripe for adjudication.
B. Merits
On the merits, to which we now turn, Texas contends that
the Procedures violate the constitutional separation of powers and
nondelegation doctrines and are contrary to and unauthorized by
IGRA or any other federal statute. To avoid resolution of any
constitutional issues, it is sufficient to consider whether the
Procedures are authorized by IGRA or the general Indian trust
statutes under the Chevron test.
16
1. Statutory Background
To put this dispute in clearer perspective, one must
recall that although states have no constitutional authority over
Indian reservations, Congress had consistently authorized states to
regulate or prohibit certain activities on the reservations. The
Supreme Court significantly altered the assumed state-tribal
relationship when, in the 1987 Cabazon Band decision, it
expansively interpreted a federal statute to prevent states from
prohibiting certain tribal gambling activities.
Congress responded to Cabazon Band by finishing work on
IGRA, a gambling-enabling statute for Indian reservations that had
been pending in the legislative process for several years. It is
unnecessary to repeat our previous summary of the statute’s complex
provisions. Suffice it to say that among those provisions is a
“carefully crafted and intricate remedial scheme”4 whereby, if a
tribe and state do not voluntarily enter a compact for Class III
gaming, the principal alternative is for the tribe to sue the state
in federal court and secure a determination that the state had not
negotiated in good faith.5 25 U.S.C. § 2710(d)(7)(A)(i). What
constitutes good-faith negotiating by the state is left
unexplained. An easy, minimal inference is that a state’s
4
Seminole Tribe, 517 U.S. at 73-74, 116 S. Ct. at 1132.
5
Even after Seminole Tribe, the federal government may sue a state on
behalf of a tribe to pursue IGRA’s remedial process without jurisdictional
impediment.
17
insistence upon its general policy against legalized Class III
gambling would constitute “good faith,” but that determination,
along with numerous other issues such as the necessary “fit”
between a state’s policy and the scope of Class III gaming sought
by a tribe, is left to a federal court — a clearly neutral forum.
Under IGRA, a federal court finding that the state negotiated in
good faith ends the bargaining process. On a finding of lack of
good faith, however, the court may order negotiation,
§ 2710(d)(7)(B)(iii), then mediation. § 2710(d)(7)(B)(iv). The
court appoints a mediator. If a state refuses to consent to the
mediator’s proposed compact (which must blend the “last best
offers” of each party), the Secretary is then authorized to
prescribe procedures that will bind the state. Moreover, the
Secretary must adopt procedures “consistent with the [mediator’s]
proposed compact . . . .” § 2710(d)(7)(B)(vii)(I). This statutory
balance on its face cabins the Secretary’s authority while
implanting neutral factfinders on the decisive questions of good
faith and the final imposition of a compact on an unwilling or
uncooperative state.
Absent the Seminole Tribe decision, this remedial plan is
self-contained and fully sufficient. No one contends that the
Secretary could have promulgated his alternative Procedures under
IGRA before Seminole Tribe was decided. Nonetheless, the Appellees
insist that IGRA implicitly conferred on the Secretary the power to
substitute the Secretarial Procedures for the judicial remedy
18
foreclosed by Seminole Tribe. This court must therefore move into
the realm of the Chevron doctrine to determine whether the
Secretarial Procedures faithfully interpret IGRA or, as the
Appellees also assert, the general Indian trust statutes. See
Class III Gaming Procedures, 64 Fed. Reg. 17,535-02, 17,536
(Apr. 12, 1999) (Secretary asserts authority to prescribe the
Procedures based on the statutory delegation of powers contained in
25 U.S.C. § 2710(d)(7)(B)(vii) of IGRA and 25 U.S.C. §§ 2 and 9).
2. Chevron Step-One Analysis
The authority of administrative agencies is constrained
by the language of the statute they administer. See Massachusetts
v. EPA, __U.S.__, 127 S. Ct. 1438, 1462 (2007). Under the Chevron
doctrine, courts assess the validity of challenged administrative
regulations by determining whether (1) a statute is ambiguous or
silent concerning the scope of secretarial authority and (2) the
regulations reasonably flow from the statute when viewed in context
of the overall legislative framework and the policies that animated
Congress’s design. See Chevron, U.S.A., Inc. v. Natural Res. Def.
Council, Inc., 467 U.S. 837, 842-43, 104 S. Ct. 2778, 2781-82
(1984).
a.
Under Chevron step one, the inquiry is “whether Congress
has directly spoken to the precise question at issue.” Id. at 842,
104 S. Ct. at 2781. Judicial deference is due only “if the agency
19
interpretation is not in conflict with the plain language of the
statute.” Nat’l R.R. Passenger Corp. v. Boston & Maine Corp.,
503 U.S. 407, 417, 112 S. Ct. 1394, 1401 (1992) (citing K Mart
Corp. v. Cartier, Inc., 486 U.S. 281, 292, 108 S. Ct. 1811, 1818
(1988)). Step one includes challenges to an agency’s interpreta-
tion of a statute, as well as whether the statute confers agency
jurisdiction over an issue. See generally FDA v. Brown &
Williamson Tobacco Corp., 529 U.S. 120, 120 S. Ct. 1291 (2000).
“Regardless of how serious the problem an administrative agency
seeks to address, however, it may not exercise its authority ‘in a
manner that is inconsistent with the administrative structure that
Congress enacted into law.’” Id. at 125, 120 S. Ct. at 1297
(quoting ETSI Pipeline Project v. Missouri, 484 U.S. 495, 517, 108
S. Ct. 805, 817 (1988)).6
As was shown above in our discussion of the statute, the
plain language of IGRA permits limited secretarial intervention
only as a last resort, and only after the statute’s judicial
remedial procedures have been exhausted. See 25 U.S.C.
§ 2710(d)(7)(B)(i)-(vi). Congress did not explicitly authorize the
Secretarial Procedures. Under Chevron step one, when, as here,
“the statute is clear and unambiguous, that is the end of the
matter; for [this] court, as well as the agency, must give effect
6
Additionally, courts “must be guided to a degree by common sense as
to the manner in which Congress is likely to delegate a policy decision of such
economic and political magnitude to an administrative agency.” Chevron, 467 U.S.
at 133, 120 S. Ct. at 1301.
20
to the unambiguously expressed intent of Congress.” K Mart,
486 U.S. at 291, 108 S. Ct. at 1817 (quoting Bd. of Governors of
the Fed. Reserve Sys. v. Dimension Fin. Corp., 474 U.S. 361, 368,
106 S. Ct. 681, 685 (1986)); Chevron, 467 U.S. at 842-43, 104
S. Ct. at 2781-82.7
b.
Chevron deference “comes into play, of course, only as a
consequence of statutory ambiguity, and then only if the reviewing
court finds an implicit delegation of authority to the agency.”
Sea-Land Serv., Inc. v. Dep’t of Transp., 137 F.3d 640, 645 (D.C.
Cir. 1998) (citing Chevron, 467 U.S. at 842-44, 104 S. Ct. at 2781-
83). Thus, even if there were an ambiguity concerning whether IGRA
permits the Secretarial Procedures without exhaustion of its
judicially-controlled remedy, an equally salient fact is that
“[m]ere ambiguity in a statute is not evidence of congressional
delegation of authority.” Michigan v. EPA, 268 F.3d 1075, 1082
(D.C. Cir. 2001)(citing cases); Montana v. Clark, 749 F.2d 740, 745
(D.C. Cir. 1984) (“[D]eference to an agency’s interpretation
constitutes a judicial determination that Congress has delegated
the norm-elaboration function to the agency and that the
7
It is noteworthy that the “Indian canon” of statutory construction
has no bearing on this case because IGRA unambiguously defines the scope of
secretarial authority and the conditions under which such authority may be
lawfully exercised. See Negonsott v. Samuels, 507 U.S. 99, 110, 113 S. Ct. 1119,
1125-26 (1993) (courts do not “resort to [the Indian] canon of statutory
construction” when a statute is unambiguous (citation omitted)); Cabazon Band of
Mission Indians v. Nat’l Indian Gaming Comm’n, 14 F.3d 633, 637 (D.C. Cir. 1994)
(“When the statutory language is clear, as it is here, the [Indian] canon may not
be employed.”).
21
interpretation falls within the scope of that delegation.”
(emphasis in original) (citation omitted)). The Appellees’ argu-
ment attempts to obviate Chevron’s delegation requirement by
contending that, despite IGRA’s meticulous description of the
protracted remedial prelude to the Secretary’s involvement in
approving Class III gaming without a state’s consent, this court
can nonetheless discover a silent, or “implicit,” delegation of
secretarial authority. That is, Appellees contend that even though
Congress specifically addressed the circumstances under which
secretarial authority can be exercised — and even though those
circumstances are absent here — the Secretary’s actions are
justifiable because IGRA does not explicitly address the Eleventh
Amendment issue that arose in the wake of Seminole Tribe.
Courts encountering this kind of “whatever-it-takes”
approach to Chevron analysis in the past have rejected it. See,
e.g., Platte River Whooping Crane Critical Habitat Maint. Trust v.
FERC, 962 F.2d 27, 33 (D.C. Cir. 1992) (appeals to a statute’s
broad purposes do not allow the discovery of implicit delegations
of authority when Congress has explicitly delineated the boundaries
of delegated authority). When Congress has directly addressed the
extent of authority delegated to an administrative agency, neither
the agency nor the courts are free to assume that Congress intended
the Secretary to act in situations left unspoken. See Nat’l R.R.
Passenger Corp. v. Nat’l Ass’n of R.R. Passengers, 414 U.S. 453,
458, 94 S. Ct. 690, 693 (1974) (“When a statute limits a thing to
22
be done in a particular mode, it includes the negative of any other
mode.” (quoting Botany Worsted Mills v. United States, 278 U.S.
282, 289, 49 S. Ct. 129, 132 (1929))).8 Accordingly, adminis-
trative agencies and the courts are “bound, not only by the
ultimate purposes Congress has selected but by the means it has
deemed appropriate, and prescribed, for the pursuit of those
purposes.” MCI Telecomm. Corp. v. AT&T Corp., 512 U.S. 218, 231
n.4, 114 S. Ct. 2223, 2232 n.4 (1994) (emphasis added).
Thus, at the heart of the Appellees’ delegation argument
is the assumption that since Congress did not explicitly withhold
secretarial rulemaking authority in the event that a tribe is
unable to obtain a judicial determination of the state’s bad faith,
the ensuing congressional “silence” creates an implicit delegation
under Chevron to promulgate Class III gaming regulations.
That is an inaccurate interpretation of the nature of the
delegation inquiry under Chevron’s first step. “Agency authority
may not be lightly presumed.” Michigan, 268 F.3d at 1082. “Were
courts to presume a delegation of power absent an express
withholding of such power, agencies would enjoy virtually limitless
hegemony, a result plainly out of keeping with Chevron and quite
likely with the Constitution as well.” Ethyl Corp. v. EPA, 51 F.3d
8
See also Pub. Serv. Comm. of State of N.Y. v. FERC, 866 F.2d 487,
491-92 (D.C. Cir. 1989) (executive agencies “cannot enlarge the choice of
permissible procedures beyond those that may fairly be implied from the
substantive sections and the functions there defined”).
23
1053, 1060 (D.C. Cir. 1995); Michigan, 268 F.3d at 1082.9 It
stands to reason that when Congress has made an explicit delegation
of authority to an agency, Congress did not intend to delegate
additional authority sub silentio. See Backcountry Against Dumps
v. EPA, 100 F.3d 147, 151 (D.C. Cir. 1996) (finding that explicit
congressional delegation of authority precludes an implicit
delegation more expansive than Congress’s express terms). Courts
recognize an implicit delegation of rulemaking authority only when
Congress has not spoken directly to the extent of such authority,
or has “intentionally left [competing policy interests] to be
resolved by the agency charged with administration of the statute.”
Chevron 467 U.S. at 865-66, 104 S. Ct. at 2793.
In IGRA, Congress plainly left little remedial authority
for the Secretary to exercise. The judicially-managed scheme of
good-faith litigation, followed by negotiation, then mediation,
allows the Secretary to step in only at the end of the process, and
then only to adopt procedures based upon the mediator’s proposed
compact. The Secretary may not decide the state’s good faith; may
not require or name a mediator; and may not pull out of thin air
the compact provisions that he is empowered to enforce. To infer
9
Nor can congressional silence on an issue be used as a panacea
justifying rulemaking authority untethered from any trace of congressional
intent. “To suggest, as the [Secretary] effectively does, that Chevron step two
is implicated any time a statute does not expressly negate the existence of a
claimed administrative power . . . is both flatly unfaithful to the principles
of administrative law and refuted by precedent.” Am. Bar Ass’n v. FTC, 430 F.3d
457, 468 (D.C. Cir. 2005) (quoting Ry. Labor Executives’ Ass’n v. Nat’l Mediation
Bd., 29 F.3d 655, 671 (D.C. Cir. 1994) (en banc) (emphasis in original)).
24
from this limited authority that the Secretary was implicitly
delegated the ability to promulgate a wholesale substitute for the
judicial process amounts to logical alchemy.
c.
Citing Seminole Tribe, Appellees further contend that a
judicial decision can, ex post facto, create a Chevron-type “gap”
that introduces ambiguity into the operation of a statutory scheme
and thereby authorizes an administrative agency to step in and
remedy the ambiguity. This claim ignores Chevron’s well-
established requirement that any delegation-engendering gap
contained in a statute, whether implicit or explicit, must have
been “left open by Congress,” not created after the fact by a
court. Chevron, 467 U.S. at 866, 104 S. Ct. at 2793 (emphasis
added).10
10
Moreover, no other circuit court to have considered the propriety of
the Secretarial Procedures in light of IGRA has discovered the statutory gap
purportedly created by Seminole Tribe. The Eleventh Circuit has suggested
without any analysis that if a state asserted Eleventh Amendment immunity against
a tribe’s lawsuit, the judicial good-faith determination was severable and
unnecessary, and the Secretary could simply enforce against the state regulations
governing Class III gaming. See Seminole Tribe of Fla. v. Florida, 11 F.3d 1016,
1029 (11th Cir. 1994), aff’d, 517 U.S. 44, 116 S. Ct. 1114 (1996). A close
reading of the Eleventh Circuit’s decision, however, demonstrates that it meant
to allow the Secretary to proceed under IGRA as if a judicial finding of lack of
good faith had been made and a court-appointed mediator failed to bring the
parties to terms. See id. (citing § 2710(d)(7)(B)(vii) as the basis for the
Secretarial Procedures). Nowhere does the Eleventh Circuit claim that a state’s
exercise of Eleventh Amendment sovereign immunity creates a statutory gap.
Likewise, considering IGRA in the wake of the Supreme Court’s Seminole Tribe
decision, the Ninth Circuit reaffirmed the centrality of the statutory balancing
of interests in IGRA’s remedial scheme, yet did not mention the apparent gap
Appellees claim was created by the Supreme Court. See United States v. The
Spokane Tribe of Indians, 139 F.3d 1297, 1299-1300 (9th Cir. 1998).
25
Although later enacted statutory provisions may be
relevant to determine congressional intent for purposes of Chevron
ambiguity, see Brown & Williamson, 529 U.S. at 143-44, 120 S. Ct.
at 1306-07, there is no support for the proposition that later
court decisions affect or effect ambiguity. Chevron’s delegation
inquiry gauges congressional intent that is independent from
subsequent administrative or judicial constructions of a statute.
See Nat’l Cable & Telecomm. Ass’n v. Brand X Internet Servs., 545
U.S. 967, 982, 125 S. Ct. 2688, 2700 (2005)(“[W]hether Congress has
delegated to an agency the authority to interpret a statute does
not depend on the order in which the judicial and administrative
constructions occur.”); see also Bowen v. Georgetown Univ. Hosp.,
488 U.S. 204, 208, 109 S. Ct. 468, 471 (1988)(“It is axiomatic that
an administrative agency’s power to promulgate legislative
regulations is limited to the authority delegated by Congress.”).
Accordingly, even though court interpretation of IGRA produced the
unexpected result that a state may “veto” Class III gaming by
exercising its Eleventh Amendment sovereign immunity, that outcome
has no bearing on the scope of the administrative authority
originally delegated by Congress to the Secretary.
When it so desires, Congress has the power to confer
expansive interpretive authority on agencies to accommodate
changing or unpredictable circumstances. See, e.g., Massachusetts,
__U.S. at__, 127 S. Ct. at 1462 (“The broad language of [Clean Air
Act] § 202(a)(1) reflects an intentional effort to confer
26
flexibility necessary to forestall . . . obsolescence.”). Like-
wise, Congress knows well how to cabin agency authority through
specific definitions that pretermit flexible interpretation. See,
e.g., Ethyl Corp., 51 F.3d at 1058 (Congress unambiguously
expressed that waiver decisions made under Clean Air Act
§ 211(f)(4) are based exclusively on one criterion). However, the
fact that later-arising circumstances cause a statute not to
function as Congress intended does not expand the congressionally-
mandated, narrow scope of the agency’s power. For example, in
evaluating the validity of the Federal Reserve’s interpretation of
the Bank Holding Company Act in Dimension Financial, the Supreme
Court observed that:
Congress defined with specificity certain transactions
that constitute banking subject to regulation. The
statute may be imperfect, but the [Federal Reserve] Board
has no power to correct flaws that it perceives in the
statute it is empowered to administer. Its rulemaking
power is limited to adopting regulations to carry into
effect the will of Congress as expressed in the statute.
If the Bank Holding Company Act falls short of providing
safeguards desirable or necessary to protect the public
interest, that is a problem for Congress, not that Board
or the courts, to address.
27
Dimension Fin. at 374-75, 106 S. Ct. at 689.11 In strikingly
similar terms, the Seminole Tribe Court rejected Florida’s
invitation to prescribe a remedy unsupported by the language and
legislative history of IGRA. 517 U.S. at 76, 116 S. Ct. at 1133
(“Nor are we free to rewrite [IGRA’s] statutory scheme in order to
approximate what we think Congress might have wanted had it known
that § 2710(d)(7) was beyond its authority. If that effort is to
be made, it should be made by Congress, not by the federal
courts.”).12
11
Under the Chevron analysis, the question is whether Congress could
be said to have delegated explicit or implicit authority to the agency to deal
with an issue. We focus here on implicit delegation since IGRA indisputably does
not address the post-Seminole Tribe state of affairs. The Dissent suggests that
Congress effects an implicit delegation of legislative authority each time it
decides an issue and withholds power from the agency in so doing. Following this
ungainly line of reasoning to its conclusion, the Dissent would hold that any
time a court overturns a statute speaking expressly to an administrative issue,
the agency has been delegated de facto implicit authority to revise the procedure
as it sees fit. That result stands Congress’s exertion of power on it head,
transforms a denial of agency authority into an implicit delegation thereto, and
radically undercuts the Supreme Court’s attempt in Chevron to distinguish between
congressional power and agency authority in a principled way. In the Indian
gaming context, Congress reacted to the Cabazon Band decision by adopting a
highly complex scheme to balance the tribal-state interests inherent in Indian
gaming. Congress could have simply authorized the Secretary to promulgate
compacts however he chose to do so, or, it could have refrained from acting
entirely. It took neither route. Instead, it explicitly withheld power from the
Secretary to accomplish IGRA’s balancing scheme. As Dimension Financial states,
no court decision can restore power that was withheld by Congress.
12
This comment was made in the context of the Supreme Court’s
rejection of a judicially crafted Ex Parte Young remedy — not the Secretarial
Procedures at issue in this appeal. But Florida’s proposed Ex Parte Young remedy
was rejected by the Supreme Court because, like the Secretarial Procedures, it
was contrary to the “carefully crafted and intricate remedial scheme set forth
in § 2710(d)(7)” by Congress. Seminole Tribe, 517 U.S. at 73-74, 116 S. Ct. at
1132. The Supreme Court’s reason for rejecting the Ex Parte Young remedy thus
applies with equal force to the Secretarial Procedures here. Nevertheless, we
acknowledge that the Court explicitly refused to consider the Eleventh Circuit’s
“substitute remedy” of Secretarial Procedures. Id. at 76, 116 S. Ct. at 1133;
see also 517 U.S. 1133, 116 S. Ct. 1416 (1996) (mem.).
28
Nor does the fact that judicial interpretation of a
statute leads to consequences unforeseen by Congress make a statute
“ambiguous” within the meaning of Chevron. See, e.g., Exxon Mobil
Corp. v. Allapattah Servs., Inc., 545 U.S. 546, 567, 125 S. Ct.
2611, 2625 (2005)(rejecting legislative history that might have
demonstrated Congress “did not intend” to overrule a case because
the statutory language was unambiguous that Congress did in fact
overrule the case); In re Abbott Labs., 51 F.3d 524, 528-29 (5th
Cir. 1995) (applying the plain meaning of a statute even though
that construction “may have been a clerical error”); see also
Thompson v. Goetzmann, 337 F.3d 489 (5th Cir. 2003). In Thompson,
the Department of Health & Human Services sought deference for its
interpretation of a particular term, as construed in the applicable
regulations and in its lawsuit for Medicare reimbursement. The
court stated:
[W]e reiterate that the courts are not in the business of
amending legislation. If the plain language of the MSP
statute produces the legislatively unintended result
claimed by the government, the government’s complaint
should be addressed to Congress, not to the courts, for
such revision as Congress may deem warranted, if any.
Id. at 493. Court decisions cannot serve to dilate or contract the
scope of authority delegated by Congress to an administrative
agency because delegation is a matter of legislative intent, not
judicial interpretation. Thus, if Congress did not originally
29
intend to confer rulemaking authority, the Secretary cannot
synthesize that authority from a judicial opinion.13
3. Reasonableness of Secretarial Procedures
Under Chevron’s Step Two
Even were we to conclude under the Chevron step-one
analysis that Seminole Tribe effected a sub rosa delegation of
administrative authority allowing the Secretary to ignore
Congress’s explicit limitation of his authority in
§ 2710(d)(7)(B)(vii), the Secretarial Procedures still cannot pass
muster under Chevron step two because they do not reasonably
13
The United States’ analogy to the Coal Act cases fails to lend
support to its endorsement of the unauthorized actions Interior has taken in this
case. The Fourth Circuit’s decision in The Pittston Co. v. United States,
368 F.3d 385 (4th Cir. 2004), stands only for the proposition that an
administrative agency’s interpretation of a statute in light of a subsequent
judicial decision may be permissible if that interpretation is (1) faithful to
the authority Congress originally delegated to the agency and (2) does not
contradict the plain language of the statute. That uncontroversial stance shares
our view that the scope of authority delegated by Congress to an administrative
agency is not altered by subsequent developments. See, e.g., Brand X, 545 U.S.
at 983, 125 S. Ct. at 2700. As the Pittston court recognized, the beneficiary
reassignments undertaken by the Social Security Commissioner in the wake of
Eastern Enterprises v. Apfel, 524 U.S. 498, 118 S. Ct. 2131 (1998), did not
“violate[] or disturb[] the structure of the Coal Act . . . . [The Commissioner]
followed the Coal Act’s assignment structure to the letter. . . . [T]he fact and
method of applying the Coal Act . . . have not changed.” 368 F.3d at 404-05; see
also A.T. Massey Coal Co. v. Holland, 472 F.3d 148, 167 (4th Cir. 2006)
(“[D]elegation must appear from the statute itself, not from the agency’s
actions”); Sidney Coal Co. v. Soc. Sec. Admin., 427 F.3d 336, 347 n.15 (6th Cir.
2005). The same cannot be said of the Secretary’s actions. In stark contrast
to the Commissioner’s reassignments in Pittston, here the Secretary did not
promulgate Class III gaming regulations that correspond to the structure of IGRA.
Instead, the Secretary has erected an ersatz remedial scheme that exceeds the
authority Congress delegated to the Secretary under IGRA’s remedial provisions.
Pittston does not support the creation of a novel remedial scheme never
envisioned by Congress and specifically contradictory of Congress’s expressed
intent concerning the scope of secretarial rulemaking. The application of a
preexisting remedial scheme to a narrower pool of plan participants that was
approved in Pittston is not remotely analogous to the wholesale invention of the
remedial scheme that we are confronted with in the Secretarial Procedures.
Pittston lends no support for the unprecedented “gapfilling” that the Secretary
has undertaken in this case.
30
effectuate Congress’s intent for IGRA. “If [the agency’s] choice
represents a reasonable accommodation of conflicting policies that
were committed to the agency’s care by the statute,” a court will
not disturb that choice “unless it appears from the statute or
legislative history that the accommodation is not one that Congress
would have sanctioned.” Chevron, 467 U.S. at 845, 104 S. Ct. at
2783 (quoting United States v. Shimer, 367 U.S. 374, 382-83, 81
S. Ct. 1554, 1560-61 (1961)); see also United States v. Riverside
Bayview Homes, Inc., 474 U.S. 121, 131, 106 S. Ct. 455, 462 (1985)
(Chevron step two entails evaluation of agency action “in light of
the language, policies and legislative history of the Act.”). In
any event, “[p]olicy considerations cannot override our
interpretation of the text and structure of the Act.” Cent. Bank
of Denver, N.A., v. First Interstate Bank of Denver, N.A., 511 U.S.
164, 188, 114 S. Ct. 1439, 1453-54 (1994). “The judiciary is the
final authority on issues of statutory construction and must reject
administrative constructions which are contrary to clear
congressional intent.” Chevron, 467 U.S. at 843 n.9, 104 S. Ct. at
2782 n.9. Thus, as with the delegation inquiry, Chevron step two
compels a judicial evaluation of congressional intent. Because the
Secretary’s actions clearly violate IGRA’s intent, they are
unreasonable.
In IGRA, Congress struck a “finely-tuned balance between
the interests of the states and the tribes” to remedy the Cabazon
Band prohibition on state regulation of Indian gaming. United
31
States v. Spokane Tribe of Indians, 139 F.3d 1297, 1301 (9th Cir.
1998); S. REP. NO. 100-446, at 2 (1988), as reprinted in 1988
U.S.C.C.A.N. 3071, 3071-72 (noting Cabazon Band’s holding that
tribes “have a right to conduct gaming activities on Indian lands
unhindered by State regulation”). Congress attempted to “provide
a means by which tribal and State governments can realize their
unique and individual governmental objectives” by giving tribes the
opportunity to negotiate a Class III gaming compact, and by giving
states the protection of an objective judicial intermediary in case
negotiations prove unsuccessful. S. REP. NO. 100-446, at 13 (1988),
as reprinted in 1988 U.S.C.C.A.N. 3071, 3083.
The lynchpin of IGRA’s balancing of interests is the
tribal-state compact. Melding the provisions for negotiation of a
compact with the remedial structure ultimately included in IGRA
took over five years to accomplish legislatively.14 Moreover,
IGRA’s legislative history amply demonstrates that Congress viewed
the compact as an indispensable prerequisite to Class III gaming.
See id. at 6, as reprinted in 1988 U.S.C.C.A.N. 3071, 3076
(“[IGRA] does not contemplate and does not provide for the conduct
of Class III gaming activities on Indian lands in the absence of a
tribal-State compact”); id. (“tribes will be unable to enter into
[Class III] gaming unless a compact is in place”). Congress
14
The legislation to enable Indian gaming was first introduced as
H.R. 4566, 97th Cong. (1983), by Representative Morris Udall in 1983. S. 555,
100th Cong. (1988), introduced by Senator Daniel Inouye, was enacted into law as
IGRA in 1988.
32
considered — and rejected — other remedial structures that did not
guarantee states such protections. The legislature eventually
settled on IGRA’s judicial remedy and the tribal-state compact
requirement as the “best mechanism to assure that the interests of
both sovereign entities are met with respect to the regulation of
complex gaming enterprises.” Id. at 13, as reprinted in 1988
U.S.C.C.A.N. 3071, 3083.
Congressional intent on this score is pellucid. In order
to conduct Class III gaming, tribes must either: (1) negotiate a
voluntary compact with the state, see 25 U.S.C. § 2710(d)(3)(A)-
(C); (2) obtain the state’s agreement to the mediator-selected
compact that follows the judicial good-faith process, see
§ 2710(d)(7)(B)(iii)-(vi); or (3) obtain secretarial Class III
procedures based on the mediator-selected compact, see
§ 2710(d)(7)(B)(vii)(I). Absent a tribal-state compact, the
statute forbids tribes to offer Class III gaming.
The tribal-state compact is in fact so central to the
IGRA process that it is the only means by which the tribe can avoid
incurring liability under other federal statutes that regulate
Indian gaming. Two statutes, both of which antedate IGRA, are
relevant to this issue. First, the Johnson Act, 15 U.S.C. § 1175
et seq., prohibits the possession or use of “any gambling device
. . . within Indian country.” Id. § 1175(a). Second, 18 U.S.C.
§ 1166 punishes gambling in Indian country in derogation of state
law. Congress coordinated IGRA with these criminal provisions by
33
providing that the tribal-state compact is the exclusive means of
avoiding gaming-related violations.15 Apart from the limited
circumstances in which IGRA allows Class III gaming to be imposed
by the Secretary following exhaustion of the judicial good-
faith/mediation process, Class III gaming remains illegal in Indian
country without a tribal-state compact.
The role the Secretary plays and the power he wields
under the Procedures bear no resemblance to the secretarial power
expressly delegated by Congress under IGRA. First, IGRA
interposes, before any secretarial involvement, the requirement
that an impartial factfinder determine whether the state has
negotiated in good faith. See § 2710(d)(7)(B)(iii). Under the
Secretarial Procedures, however, it matters not that a state
undertook good-faith negotiations with the tribe: The Secretary
may prescribe Class III gaming irrespective of a state’s good
faith. See 25 C.F.R. § 291.7-.8. This result contravenes the
plain language of IGRA.
Second, under IGRA, if mediation is ordered, it is
undertaken by a neutral, judicially-appointed mediator who
objectively weighs the proposals submitted by the state and tribe.
15
See IGRA § 2710(d)(6) (Johnson Act does not apply to gaming conducted
under a tribal-state compact); see also United States v. Cook, 922 F.2d 1026,
1034 (2d Cir. 1991) (Johnson Act liability waived only by a Class III gaming
compact between a state and tribe). Likewise, 18 U.S.C. § 1166(c)(2),
referencing IGRA, excepts “class III gaming conducted under a Tribal-State
compact.” See, e.g., Mashantucket Pequot Tribe v. Connecticut, 913 F.2d 1024,
1031 (2d Cir. 1990) (tribal-state compact required for waiver of 18 U.S.C. § 1166
liability).
34
See § 2710(d)(7)(B)(iv). Under the Procedures, however, the
Secretary selects the mediator. 25 C.F.R. § 291.9. In light of
the Secretary’s statutory trust obligation to protect the interests
of Indian tribes, this aspect of the Procedures is stacked against
the objective interest-balancing Congress intended and creates the
strong impression of a biased mediation process. See, e.g.,
Kickapoo Tribe of Indians of Kickapoo Reservation in Kan. v.
Babbitt, 43 F.3d 1491, 1499 (D.C. Cir. 1995) (noting that “the
Secretary was not in a position to champion the State’s position in
view of his trust obligations to the tribe.” (citing Heckman v.
United States, 224 U.S. 413, 444-45, 32 S. Ct. 424, 433-34
(1912))). Common sense dictates that the Secretary cannot play the
role of tribal trustee and objective arbiter of both parties’
interests simultaneously. Congress did not intend this incoherent
result.
Third, whereas under IGRA’s remedial scheme the court-
appointed mediator essentially defines the regulations that the
Secretary may promulgate, the Procedures enable the Secretary to
disregard not only the mediator’s proposal, but also the proposals
of the state and tribe.16 IGRA’s remedial process makes clear that
16
Compare § 2710(d)(7)(B)(vii) (“the mediator shall notify the
Secretary and the Secretary shall prescribe . . . procedures (I) which are
consistent with the proposed compact selected by the mediator under clause (iv))
with 25 C.F.R. § 291.11(c) (“If the Secretary rejects the mediator’s proposal
. . . he/she must prescribe appropriate procedures within 60 days under which
Class III gaming may take place that comport with the mediator’s selected
proposal as much as possible, the provisions of IGRA, and the relevant provisions
of the laws of the State.”).
35
Congress did not intend to delegate to the Secretary unbridled
power to prescribe Class III regulations.
Fourth, the Secretarial Procedures contemplate Class III
gaming in the absence of a tribal-state compact — directly in
derogation of Congress’s repeated and emphatic insistence. See,
e.g., S. REP. NO. 100-446, at 6 (1988), as reprinted in 1988
U.S.C.C.A.N. 3071, 3076 (“[IGRA] does not contemplate and does not
provide for the conduct of class III gaming activities on Indian
lands in the absence of a tribal-State compact.”).17 The only
exception to the compact requirement Congress envisioned was the
promulgation of procedures after a bad-faith determination and in
concert with the proposal selected by a court-appointed mediator.
Yet in spite of this single statutory exception — the product of
IGRA’s complex and balanced remedial scheme — Appellees maintain it
is equally reasonable to assume that Congress intended a waiver of
liability under the Johnson Act and 18 U.S.C. § 1166 even without
a judicial determination of bad faith; without the participation of
a court-appointed mediator; and without the requirement that the
regulations ultimately promulgated be “consistent with the proposed
17
Department of the Interior and Related Agencies Appropriations Act,
Pub. L. No. 105-83, 111 Stat. 1543, 1570 (1998) (“SENSE OF THE SENATE CONCERNING
INDIAN GAMING. It is the sense of the Senate that the United States Department
of Justice should vigorously enforce the provisions of the Indian Gaming
Regulatory Act requiring an approved Tribal-State gaming compact prior to the
initiation of class III gaming on Indian lands.”)
36
compact selected by the [court-appointed] mediator.”
§ 2710(d)(7)(b)(vii)(I).18
For all these reasons, the Secretary’s Class III
Procedures are not a reasonable interpretation of IGRA, especially
when viewed against “their place in the overall statutory scheme.”
Brown & Williamson, 529 U.S. at 133, 120 S. Ct. at 1301. The
Secretary, of course, is not authorized to promulgate regulations
in violation of federal law, see Sohappy v. Hodel, 911 F.2d 1312,
1320 (9th Cir. 1990), yet the Secretarial Procedures stand in
direct violation of IGRA, the Johnson Act, and 18 U.S.C. § 1166
insofar as they may authorize Class III gaming without a compact.
Because “the Executive Branch is not permitted to administer the
Act in a manner that is inconsistent with the administrative
structure that Congress enacted into law,” and because doing so
constitutes an unreasonable interpretation of Congress’s intent,
18
Commentators have noted the problems with the Procedures. See
Rebecca S. Lindner-Cornelius, Note, The Secretary of the Interior as Referee: The
States, The Indian Nations, and How Gambling Led to the Illegality of the
Secretary of the Interior’s Regulations in 25 C.F.R. § 291, 84 MARQUETTE L. REV.
685, 695 (2001) (arguing that the regulations are unconstitutional and noting
that “when a state claims it has negotiated in good faith to no avail, the only
recourse it is left with is a biased factfinder who can do what it wants without
any state input”); Nicholas S. Goldin, Note, Casting a New Light on Tribal Casino
Gaming: Why Congress Should Curtail the Scope of High Stakes Indian Gaming,
84 CORNELL L. REV. 798, 843-44 (1999) (arguing that the Procedures are “troubling”
because the Secretary “assumes a massive unilateral power that Congress did not
intend to delegate” and because the Procedures “make a travesty of the concept
of federalism and in its place substitute a system in which Washington claims it
knows best what state laws mean”); Joe Laxague, Note, Indian Gaming and Tribal-
State Negotiations: Who Should Decide the Issue of Bad Faith?, 25 J. LEGIS. 77,
91 (1999) (arguing that the Procedures “do both parties a disservice and badly
skew the balance of interests intended by Congress when it wrote the IGRA”).
37
the Secretarial Procedures cannot pass muster under Chevron step
two. ETSI Pipeline Project, 484 U.S. at 157, 108 S. Ct. at 817.
4. General Authority Statutes
An alternative contention raised by Appellees is that
secretarial authority to promulgate the Procedures derives from the
general Indian trust statutes when read in concert with
§ 2710(d)(7)(B)(vii). See 25 U.S.C. §§ 2, 9; 64 Fed. Reg.
17,535-02, 17,536 (Apr. 12, 1999). To be sure, courts may consider
“generally conferred authority” in the statutory scheme to
determine the propriety of administrative agency action. United
States v. Mead Corp., 533 U.S. 218, 229, 121 S. Ct. 2164, 2172
(2001). But sections 2 and 9 do not grant Interior “a general
power to make rules governing Indian conduct.” Organized Vill. of
Kake v. Egan, 369 U.S. 60, 63, 82 S. Ct. 562, 564 (1962). Instead,
the authority Congress there delegated to the Secretary only allows
prescription of regulations that implement “specific laws,” id.,
and that are consistent with other relevant federal legislation.
See Morton v. Ruiz, 415 U.S. 199, 232, 94 S. Ct. 1055, 1073 (1974);
N. Arapahoe Tribe v. Hodel, 808 F.2d 741, 748 (10th Cir. 1987)
(citing Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S.
402, 91 S. Ct. 814 (1971)). Thus, in Village of Kake, the
Secretary issued fishing regulations ostensibly permitted under the
White Act and the Alaska Statehood Act. However, the regulations,
which allowed the Kake community to operate four fish traps,
38
violated Alaska’s anti-fish-trap and conservation law. Because
Interior could point to no affirmative statutory grant of authority
that allowed the Secretary to issue regulations in derogation of
state law, the Supreme Court held that the Secretary had exceeded
the authority granted by sections 2 and 9. Id. at 62, 82 S. Ct. at
564. Village of Kake demonstrates that the Secretary lacks carte
blanche to issue regulations pursuant to a generalized grant of
authority untethered from the confines of preexisting statutorily
defined rights. See United States v. Eberhardt, 789 F.2d 1354,
1360 (9th Cir. 1986).
For example, in Eberhardt, the Ninth Circuit approved
secretarial regulations imposing a moratorium on commercial fishing
on the Hoopa Valley Reservation. The court held that the Secretary
was authorized to issue the regulations pursuant to the preexisting
fishing rights that were granted when Congress authorized creation
of the Hoopa Valley Reservation by statute. See People v. McCovey,
685 P.2d 687, 697 (Cal. 1984) (citing Menominee Tribe v. United
States, 391 U.S. 404, 405-06, 88 S. Ct. 1705, 1707 (1968)). In
similar fashion, the caselaw overwhelmingly confirms that
sections 2 and 9 do not empower issuance of regulations without a
statutory antecedent. See, e.g., Washington v. Wash. State
Commercial Passenger Fishing Vessel Assoc., 443 U.S. 658, 691, 99
S. Ct. 3055, 3077 (1979) (sections 2 and 9 effectuate rights
granted by treaty); N. Arapahoe Tribe, 808 F.2d at 749 (general
trust statutes “together with the Treaty . . . provide the neces-
39
sary authority for the Secretary to enact these regulations.”);
United States v. Michigan, 623 F.2d 448, 450 (6th Cir. 1980)
(upholding secretarial regulations governing rights conferred by
treaty).19
IGRA, however, does not guarantee an Indian tribe the
right to conduct Class III gaming and therefore cannot serve as a
statutory antecedent justifying the Secretarial Procedures. IGRA
grants tribes the right to negotiate the terms of a tribal-state
compact, see 25 U.S.C. § 2710(d)(3)(A), and by agreement to
“regulate class III gaming on its Indian lands concurrently with
the State.” § 2710(d)(5). Tribes, likewise, have the right to
bring suit against a state for its failure “to enter into
negotiations with the Indian tribe.” See § 2710(d)(7)(A)(i).
Seminole Tribe, of course, clarified that the tribe’s right is
subject to the state’s exercise of an affirmative jurisdictional
19
In addition to the requirement that the regulations be issued in
accordance with the rights conferred on the tribe by existing federal
legislation, here, IGRA courts have recognized that sections 2 and 9 address the
protection and management of “Indian trust resources” – typically natural
resources or property. See, e.g., Washington v. Wash. State Commercial Passenger
Fishing Vessel Assoc., 443 U.S. 658, 99 S. Ct. 3055 (1979) (fishing rights);
Chippewa Indians of Minn. v. United States, 301 U.S. 358, 57 S. Ct. 826 (1937)
(land allotment); Pyramid Lake Paiute Tribe of Indians v. United States Dep’t of
Navy, 898 F.2d 1410 (9th Cir. 1990) (fisheries preservation); N. Arapahoe Tribe
v. Hodel, 808 F.2d 741 (10th Cir. 1987) (hunting and fishing rights); see also
Morton v. Ruiz, 415 U.S. 199, 94 S. Ct. 1055 (1974) (payment of general
assistance benefits authorized under 25 U.S.C. § 13); Seminole Nation v. United
States, 316 U.S. 286, 62 S. Ct. 1049 (1942) (money held in trust by the United
States). Appellees’ assertion that sections 2 and 9 apply here assumes that
anticipated gambling revenues constitute an Indian trust resource within the
meaning of those statutes. This assertion is especially unjustified since, under
IGRA, after a tribal-state compact is in place the Secretary has no role
whatsoever in the management or oversight of Class III gaming. See 25 U.S.C.
§ 2710(d)(5).
40
defense under the Eleventh Amendment. In any case, the Secretary’s
acting under sections 2 and 9 cannot sidestep IGRA’s remedial
process for two reasons. First, there would have been no reason
for IGRA to prescribe any procedures had Congress been willing to
or believed it could entrust them entirely to the Secretary’s
general powers. Second, the fact that IGRA clearly limited the
Secretary’s intervention into Class III gaming compacts constitutes
the best evidence of congressional intent to limit the Secretary’s
role.
IV. CONCLUSION
The Secretarial Procedures violate the unambiguous
language of IGRA and congressional intent by bypassing the neutral
judicial process that centrally protects the state’s role in
authorizing tribal Class III gaming. Congress, to be sure, could
omit states entirely from Class III gaming regulation. See Cabazon
Band, 480 U.S. at 207, 107 S. Ct. at 1087. But we need not
speculate on legislative alternatives that Congress might adopt in
response to Seminole Tribe. Suffice it here to say that the
balance Congress did strike cannot be wholly revised by substitute
procedures that contradict Congress’s explicit statutory instruc-
tions. The Secretarial Procedures are invalid and constitute an
unreasonable interpretation of IGRA. When, as here, “the intent of
Congress is clear, that is the end of the matter; for the court, as
well as the agency, must give effect to the unambiguously expressed
41
intent of Congress.” Chevron, 467 U.S. at 842-43, 104 S. Ct. at
2781.
Pursuant to the foregoing discussion, we REVERSE the
district court’s judgment and REMAND for further proceedings
consistent with this opinion.
REVERSED and REMANDED.
42
KING, Circuit Judge, concurring in part and in the judgment:
I concur in Part III.A of the opinion, which deals with justiciability. On
the merits, I concur only in the judgment, reversing the district court’s
conclusion that the Secretary of the Interior (“Secretary”) had the authority to
promulgate the challenged regulations.
In my view, the lack of any provision in the Indian Gaming Regulatory Act
(“IGRA”) addressing the dismissal of an Indian tribe’s enforcement suit on
sovereign immunity grounds is a statutory gap that is akin to the gap recognized
in Pittston Co. v. United States, 368 F.3d 385, 403-04 (4th Cir. 2004), and
Sidney Coal Co. v. Social Security Administration, 427 F.3d 336, 346 (6th Cir.
2005). Those cases held that the Social Security Commissioner had implicit
authority to fill a gap exposed by the Supreme Court’s invalidation of a portion
of the Coal Industry Retiree Health Benefit Act of 1992; in this case the
Secretary’s general authority to effectuate statutes relating to Indian affairs
provides analogous gap-filling power with regard to IGRA. See 25 U.S.C. §§ 2,
9; Morton v. Ruiz, 415 U.S. 199, 231 (1974); Organized Village of Kake v. Egan,
369 U.S. 60, 63 (1962).
However, the Secretary's authority to effectuate IGRA's provisions does
not include the power to jettison some of those provisions in the cause of
gap-filling, regardless of whether they no longer seem wise or appropriate in
light of events that Congress did not foresee. In my opinion, the method used by
the Secretary to fill the gap here—creating an alternative remedial scheme that
allows the Secretary to issue Class III gaming procedures without Congress’s
chosen prerequisites of a court determination of a state’s bad faith and court-
directed mediation, see 25 U.S.C. § 2710(d)(7)—goes beyond the mere
effectuation of IGRA’s provisions into the realm of wholesale statutory
amendment. Cf. Gonzales v. Oregon, 546 U.S. 243, 258 (2006) (“Chevron
43
deference . . . is not accorded merely because the statute is ambiguous . . . . To
begin with, the rule must be promulgated pursuant to authority Congress has
delegated to the official.”). By omitting those prerequisites, though for
understandable reasons, the Secretary’s method fails to preserve the core
safeguards by which state interests are protected in Congress’s “carefully crafted
and intricate remedial scheme.” Seminole Tribe of Fla. v. Florida, 517 U.S. 44,
73-74 (1996); cf. Ragsdale v. Wolverine World Wide, Inc., 535 U.S. 81, 91 (2002)
(invalidating an administrator’s remedial regulation that “worked an end run
around important limitations of the [relevant] statute’s remedial scheme” by
allowing a penalty to be imposed without the threshold court determination
provided for by the statute). And despite a state’s unforeseen and unintended
ability to prevent the necessary court involvement from occurring, the Secretary
“has no power to correct flaws that [he] perceives in the statute [he] is
empowered to administer. [His] rulemaking power is limited to adopting
regulations to carry into effect the will of Congress as expressed in the statute.”
Bd. of Governors v. Dimension Fin. Corp., 474 U.S. 361, 374 (1986).
Today’s decision returns IGRA’s Class III gaming system to the
complicated situation that existed after the Supreme Court’s decision in
Seminole Tribe, with a state having the leverage to block gaming on Indian land
under IGRA in a manner wholly contrary to Congress’s intent. Alternatively,
one could argue that a tribe dealing with a state that will not negotiate or
consent to an enforcement suit is no longer bound by IGRA’s prohibition on
gaming without a compact, depending on the circumstances. See, e.g., United
States v. Spokane Tribe of Indians, 139 F.3d 1297 (9th Cir. 1998). We do not
resolve these difficulties here, as they are not before this court. But because
neither result is consistent with IGRA’s design, the situation clearly calls for
congressional action.
44
DENNIS, Circuit Judge, dissenting.
I.
The State of Texas permits certain types of gaming equivalent to Class III
gaming as defined by the IGRA. But Texas adamantly refuses to negotiate with
the Kickapoo Traditional Tribe towards a Class III gaming compact under the
IGRA and has blocked the tribe from seeking a remedy in federal court by
invoking its right to Eleventh Amendment sovereign immunity from suit.
Therefore, the Tribe pursued its only alternate remedy of asking the Secretary
of the Interior to issue Class III gaming procedures under the Secretarial
Gaming Procedures, 25 C.F.R. §§ 291.1-291.15. The Secretary requested
comment from the State of Texas pursuant to 25 C.F.R. § 291.7, but the state
declined to comment. The Secretary has not yet taken final action on the Tribe’s
proposal.
The State of Texas brought this action against the Secretary, the
Department of the Interior and the United States challenging the authority of
the Secretary to promulgate the Secretarial Gaming Procedures regulations and
seeking to permanently enjoin the application of 25 C.F.R. § 291.1, et seq., in
respect to the state of Texas. The Kickapoo Traditional Tribe intervened. The
district court ruled that Texas’s claims were not ripe, but expressed its opinion
that the regulations were validly promulgated and should be upheld. Texas v.
45
United States, 362 F. Supp.2d 765 (W.D. Tex. 2004). Texas appealed. The
defendants-appellees and the intervener contend that Texas’s suit should be
dismissed because it lacks standing, its claim is not ripe, and the Secretarial
Gaming Procedures regulations are valid. I pretermit the serious standing and
ripeness issues but dissent from the merits of Chief Judge Jones’ opinion,
portions of Judge King’s opinion, and the judgment for the following reasons.
II.
The principles governing our review of the Secretary’s interpretation and
implementation of the pertinent statutes are well established. Administrative
implementation of a particular statutory provision qualifies for Chevron
deference when it appears that Congress delegated authority to the agency
generally to make rules carrying the force of law, and that the agency
interpretation claiming deference was promulgated in the exercise of that
authority. United States v. Mead Corp., 533 U.S. 218 (2001); see also Chevron,
U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837 (1984).
Congressional delegation to an administrative agency of authority generally to
make rules carrying the force of law may be shown in a variety of ways, as by an
agency’s power to engage in adjudication or notice-and-comment rule-making,
or by some other indication of a comparable congressional intent. Mead, 533 U.S.
at 227.
46
When Congress has explicitly left a gap for an agency to fill, there is an
express delegation of authority to the agency to elucidate a specific provision of
the statute by regulation, and any ensuing regulation is binding in the courts
unless procedurally defective, arbitrary or capricious in substance, or manifestly
contrary to the statute. Id. Considerable weight should be accorded to an
executive department’s construction of a statutory scheme it is entrusted to
administer. Id. “The power of an administrative agency to administer a
congressionally created and funded program necessarily requires the
formulation of policy and the making of rules to fill any gap left, implicitly or
explicitly, by Congress.” Morton v. Ruiz, 415 U.S. 199, 231-32 (1974).
When circumstances imply that Congress would expect an agency to be
able to speak with the force of law, even though Congress may not have
expressly delegated authority or responsibility to implement a particular
provision, a reviewing court has no business rejecting an agency’s exercise of its
generally conferred authority to resolve a particular statutory ambiguity simply
because the agency’s chosen resolution seems unwise, and instead is obliged to
accept the agency’s position if Congress has not previously spoken to the point
at issue and the agency’s interpretation is reasonable. Id. at 229.
III.
47
The regulations challenged here, pertaining to the Secretarial Gaming
Procedures, deserve Chevron deference because Congress explicitly authorized
the Secretary to promulgate regulations to carry into effect any statute relating
to Indian affairs or arising out of Indian relations, see 25 U.S.C. §§ 1a, 2 & 9;
and implicitly authorized the Secretary to promulgate the regulations at issue
here to fill the gap in the IGRA created by Congress’s unintentional failure to
provide for the unforeseen ineffectiveness of a federal court suit as the tribal
remedy in cases in which a state refused to bargain in good faith and invoked its
Eleventh Amendment sovereign immunity; the regulations are reasonably
designed and appropriate for carrying into effect the IGRA after the
ineffectiveness of its remedial provision was revealed by Seminole Tribe of
Florida v. Florida, 517 U.S. 44 (1996); and the regulations are binding in the
courts because they are not procedurally defective, arbitrary or capricious in
substance, or manifestly contrary to the statutes.
Beginning in 1832 and 1834, Congress explicitly authorized the President
through the Secretary of the Interior to “prescribe such regulations as he may
think fit for carrying into effect the various provisions of any act relating to
Indian affairs, and for the settlement of the accounts of Indian affairs,” 25 U.S.C.
§ 9; and to authorize the Commissioner of Indian affairs to, “under the direction
of the Secretary of the Interior, and agreeably to such regulations as the
48
President may prescribe, have the management of all Indian affairs and of all
matters arising out of Indian relations.” 25 U.S.C. § 2.1 Acting pursuant to these
broad powers, the Secretary has, following formal notice-and-comment rule-
making procedures, promulgated procedures governing numerous programs and
activities related to Indian affairs and relations.
Prior to the enactment of the IGRA, states generally were precluded from
any regulation of gaming on Indian reservations. California v. Cabazon Band of
Mission Indians, 480 U.S. 202 (1987). The IGRA, by offering states an
opportunity to participate with Indian tribes in establishing gaming through a
tribal-state compact, “extend[ed] to the States a power withheld from them by
the Constitution.” Seminole, 517 U.S. at 58. Consequently, it is clear that before
the enactment of the IGRA, the Secretary could have adopted, under 25 U.S.C.
§§ 1a, 2, & 9, regulations approving and governing gambling on Indian
reservations to the extent it was not prohibited by general state laws.
Congress’s enactment of the IGRA in 1988 did not in any way diminish the
broad powers of the President or the Secretary to “prescribe such regulations as
he may think fit for carrying into effect ... any act relating to Indian affairs ... or
[management of] matters arising out of Indian relations.” See 25 U.S.C. §§ 2 &
9. When the Supreme Court subsequently held in Seminole that Congress is not
1
See Morton v. Ruiz, 415 U.S. 199 (1974); see also 25
U.S.C. § 1a.
49
authorized by the Indian commerce clause to abrogate a state’s Eleventh
Amendment sovereign immunity, this unforeseen event disclosed the
ineffectiveness of the remedy Congress had granted tribes in the IGRA to sue
recalcitrant states in federal court. The immediate result was that states could,
as Texas has done, refuse to bargain and invoke sovereign immunity against a
tribe’s federal court remedy. This revealed that after Seminole the tribes had no
remedy to enforce the IGRA, a gap in the statute that Congress had not
anticipated and had unintentionally failed to provide for. Under these
circumstances, it became the Secretary’s clear duty to use his broad rule-making
powers under 25 U.S.C. §§ 1a, 2 and 9 to provide alternate remedies and
procedures necessary to carry the IGRA into effect. Nothing in the IGRA or its
legislative history indicates an intention to prevent the Secretary from retaining
and putting his broad rulemaking powers to this use.
The purpose of the IGRA is not simply to establish a neutral bargaining
forum; IGRA’s purpose is to affirmatively help Indian tribes enter and conduct
the business of gaming, where gaming is not prohibited by state laws of general
application, as a means of “promoting tribal economic development,
self-sufficiency, and strong tribal governments.” 25 U.S.C. § 2702(1). The IGRA
federal court action remedy was “designed to ensure the formation of a
Tribal-State compact.” Seminole, 517 U.S. at 49-50. Because this remedy has
50
been shown to be inoperative by Seminole, the Secretary’s Gaming Procedures
are consistent with the purpose and provisions of the IGRA and are the most
reasonable regulations that could be administratively prescribed to carry the
IGRA into effect.
IV.
With respect, there is no valid basis for Chief Judge Jones’s assertion that
a judicial interpretation of a statute cannot lead to an ambiguity, gap or
unprovided for case susceptible to the Chevron step-two analysis. To the
contrary, there is no other way for a court to identify a statutory ambiguity or
gap than through the process of judicial interpretation.
The argument that a court decision “creates” a gap is based on a theory
inconsistent with the common-law tradition of the federal courts. The prevailing
view is that the judicial power vested in the federal courts allows them to declare
what the law already is, rather than to create new law as the Chief Judge’s
argument presupposes that the Court did in Seminole. See American Trucking
Associations, Inc. v. Smith, 496 U.S. 167, 201 (1990) (Scalia, J., concurring in
judgment); Linkletter v. Walker, 381 U.S. 618, 622-23 (1965). Under the
prevailing Supreme Court view, the ambiguity or gap in the IGRA was created
by the Congress when it unintentionally chose and enacted a constitutionally
ineffectual tribal remedy, and not by the Court in the Seminole decision. The
51
Supreme Court’s principles governing retroactive application of its decisions
reflect this view: “When this Court applies a rule of federal law to the parties
before it, that rule is the controlling interpretation of federal law and must be
given full retroactive effect in all cases still open on direct review and as to all
events, regardless of whether such events predate or postdate our announcement
of the rule.” Harper v. Virginia Dep’t of Taxation, 509 U.S. 86, 97 (1993).2 Under
prevailing Supreme Court theory, the Seminole decision is and always was the
law. The Supreme Court does not create law, it discovers it - and the Supreme
Court did not create the gap in this case, but merely declared its existence.
Congress itself created the gap or ambiguity by mistakenly overestimating its
powers and passing a statute that could not be constitutionally applied as
Congress intended.
The claim that a Chevron gap does not exist when a judicial decision has
demonstrated an ambiguity in the statute has been emphatically rejected by
other courts. In A.T. Massey Coal Co. v. Holland, 472 F.3d 148, 168 (4th Cir.
2006), the Fourth Circuit discussed a case in which a gap was “created when the
Supreme Court found a portion of [a] provision unconstitutional.” It held that
2
For a full discussion of the history of the common law
retroactivity principle and the Supreme Court’s recent return to
the traditional view that it discovers law, rather than makes it,
see Hulin v. Fibreboard Corp., 178 F.3d 316, 329-33 (5th Cir.
1999).
52
“[o]nce that gap was created, the agency was left with an open policy space,
which was the quintessence of legislative-type action to which Chevron deference
was due.” Id. In another case, Pittston Co. v. United States, 368 F.3d 385, 403-04
(4th Cir. 2004), the Fourth Circuit considered a gap disclosed by a judicial
decision holding a portion of the Coal Act to be unconstitutional:
In drafting the Coal Act, Congress did not contemplate that some
members of the “signatory operators” group could not
constitutionally be required to contribute to the Combined Fund.
The situation faced by the Commissioner was thus the kind of “case
unprovided for” that allows her to engage in gap-filling. See
Barnhart v. Peabody Coal Co., 537 U.S. 149, 169 (2003).
Id. The Sixth Circuit agreed that a gap for Chevron purposes was created when
a portion of the Coal Act proved to be unintentionally ineffective. Sidney Coal
Co. v. Soc. Sec. Admin., 427 F.3d 336, 346 (6th Cir. 2005) (holding that a gap
existed because “the Coal Act contains no language as to how the SSA should
have handled the precise question raised by the Eastern Enterprises holding”).
Chief Judge Jones’s attempt to distinguish these cases is unpersuasive and
circular. She contends that because Congress must be able to foresee each gap
and each agency rule chosen to fill it, the Secretary’s remedial scheme here to
fill the gap exceeds the scope of the authority delegated by Congress; so that, the
gap created by judicial decision recognized in Pittson and A.T. Massey could not
53
have existed in the first place. This is a tortured logic that conflates two
fundamentally distinct questions: was there a gap or ambiguity, and if so, did
the Secretary exceed its authority in attempting to fill it?
Contrary to the suggestion of Chief Judge Jones, the language of Chevron
does not require that Congress must be able to envision a future gap or
ambiguity and the particular provision that the agency may choose to fill it or
clarify it before it can come within the scope of the agency’s implicitly authorized
rulemaking. “[I]t can still be apparent from the agency's generally conferred
authority and other statutory circumstances that Congress would expect the
agency to be able to speak with the force of law when it addresses ambiguity in
the statute or fills a space in the enacted law, even one about which Congress did
not actually have an intent as to a particular result.” Mead, 533 at 229
(quotations omitted) (emphasis added). Congress may “create” a gap by explicitly
delegating a question of interpretation to an agency; Chevron, 467 U.S. at 843-
44; by implicitly doing so; id. at 844; or by simply remaining silent “with respect
to the specific issue;” id. at 843. It is inherent in the policymaking process that
some unforeseen event, or “case unprovided for,” could render a portion of a
statute ambiguous or meaningless. See Barnhart v. Peabody Coal Co., 537 U.S.
149, 169 (2003). The Ninth Circuit best described the situation that confronted
the Secretary and now confronts us:
54
We are left, then, with a tribe that believes it has followed IGRA
faithfully and has no legal recourse against a state that allegedly
hasn’t bargained in good faith. Congress did not intentionally create
this situation and would not have countenanced it had it known
then what we know now.
United States v. Spokane Tribe of Indians, 139 F.3d 1297, 1302 (9th Cir. 1998).
There is no support for the suggestion that Congress cannot, through its
unintentional silence, create a gap or an ambiguity concerning how to enforce
the IGRA after a portion of it, the sole tribal remedy originally chosen, has been
invalidated.
V.
Chief Judge Jones further errs in contending that there has been no
explicit or implicit congressional delegation of authority to the Secretary of the
Interior to promulgate gap-filling regulations under the IGRA. Contrary to her
assertions, the Secretary does not hang his hat on a mere failure of Congress to
expressly withhold a delegation of agency authority. Rather, the Secretary of the
Interior is the agency Congress would have expected to fill any such gap, given
the powers granted to it under the IGRA and its general authority statutes.
Chief Judge Jones focuses narrowly on the particular IGRA provision at issue
here, relying conclusively on the fact that the IGRA itself does not contain an
express delegation of agency authority to provide an alternate tribal remedy.
55
The Supreme Court, by contrast, has instructed us to broaden our inquiry
outside of the particular provision we are reviewing to include all statutes and
circumstances pertaining to the agency’s powers:
Congress, that is, may not have expressly delegated authority or
responsibility to implement a particular provision or fill a particular
gap. Yet it can still be apparent from the agency's generally
conferred authority and other statutory circumstances that
Congress would expect the agency to be able to speak with the force
of law when it addresses ambiguity in the statute or fills a space in
the enacted law, even one about which “Congress did not actually
have an intent” as to a particular result. When circumstances
implying such an expectation exist, a reviewing court has no
business rejecting an agency’s exercise of its generally conferred
authority to resolve a particular statutory ambiguity simply because
the agency's chosen resolution seems unwise, but is obliged to accept
the agency’s position if Congress has not previously spoken to the
point at issue and the agency’s interpretation is reasonable....
Mead, 533 U.S. at 229 (internal citations omitted). Instead of inquiring into
whether Congress would have expected the Secretary of the Interior to address
any ambiguities in the IGRA, Chief Judge Jones focuses on whether the
particular IGRA statutory provision at issue included a delegation of authority
to the Secretary - an analysis that is both contrary to the Supreme Court’s
admonition in Mead and that would impose an impractical burden on Congress
56
of including express delegations of an agency’s authority to administer every
provision of every statute under its aegis.
Chief Judge Jones’s analysis of the general authority statutes and the
IGRA itself is similarly unpersuasive. Her opinion rejects the significance of 25
U.S.C. §§ 2 & 9, the general authority statutes for the Department of the
Interior, based on a misplaced reliance on the Supreme Court’s decision in
Organized Village of Kake v. Egan. 369 U.S. 60 (1962). Kake is a weak authority
for her position for several reasons. Even if it made the sweeping holdings Chief
Judge Jones attributes to it, the case was decided in 1963 and did not conduct
the modern analysis required by more recent cases such as Chevron and Mead.
A greater difficulty for Chief Judge Jones is that while it does indeed include
language to the effect that these sections do not grant the Interior “a general
power to make rules governing Indian conduct,” that language was not the
holding of the court in that case. That language was, instead, a quotation from
an Interior Department Handbook, and was not expressly adopted by the Court.
The Court’s actual legal holding with respect to the scope of the general
authority statutes was confined to a single sentence: “We agree that they do not
support the fish-trap regulations.” Kake, 369 U.S. at 63. Most significantly, in
Kake the Court was analyzing a situation in which other Congressional
legislation, the White Act, had expressly narrowed the authority of the Secretary
57
of the Interior under 25 U.S.C. §§ 2 and 9 in the specific area in which he
attempted to act. Id. at 62-63. It was also plain that, unlike in this case, there
was no underlying statute being enforced and the Secretary was not attempting
to “implement specific laws” - a power the Handbook referenced by the Supreme
Court in Kake concluded was granted to Interior under the general authority
statutes. Id.
Chief Judge Jones’s reliance on United States v. Eberhardt, 789 F.2d 1354
(9th Cir. 1986), similarly distorts the actual holding of the case. Her opinion
omits that court’s holding that “the general trust statutes in Title 25 do furnish
Interior with broad authority to supervise and manage Indian affairs and
property commensurate with the trust obligations of the United States.” Id. at
1360. In distinguishing Kake and concluding that the general authority statutes
were broad in scope, the Eberhardt court added that “Congress must be assumed
to have given Interior reasonable power to discharge its broad responsibilities
for the management of Indian affairs effectively.” Id. at 1361.
Chief Judge Jones’s opinion further avoids referencing other cases that
have also come to the conclusion that the Secretary of the Interior has
comprehensive powers under the general authority statutes to effectuate other
Indian-related legislation. The D.C. Circuit, from which her opinion eagerly
borrows in other sections, emphatically disagrees with a cramped view of the
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general authority statutes such as hers. That court described the powers of the
Secretary of the Interior under the general authority statutes as follows:
In charging the Secretary with broad responsibility for the welfare
of Indian tribes, Congress must be assumed to have given him
reasonable powers to discharge it effectively. Courts have taken this
approach with respect to various aspects of Indian life, recognizing
that ‘[this] statute furnishes broad authority for the supervision and
management of Indian affairs and property commensurate with the
obligation of the United States.’
In our opinion the very general language of the statutes makes it
quite plain that the authority conferred upon the Commissioner of
Indian Affairs was intended to be sufficiently comprehensive to
enable him, agreeably to the laws of Congress and to the supervision
of the President and the Secretary of the Interior, to manage all
Indian affairs, and all matters arising out of Indian relations, with
a just regard, not merely to the rights and welfare of the public, but
also to the rights and welfare of the Indians, and to the duty of care
and protection owing to them by reason of their state of dependency
and tutelage.
Udall v. Littell, 366 F.2d 668, 672-73 (D.C. Cir. 1966) (internal citations and
footnotes omitted). Other circuits have agreed that the Secretary’s powers to
promulgate regulations to effectuate all Indian-related statues are broad in
scope. See Armstrong v. United States, 306 F.2d 520, 522 (10th Cir. 1962) (“This
59
statute furnishes broad authority for the supervision and management of Indian
affairs and property commensurate with the obligation of the United States.”).
Inexplicably, the Chief Judge’s opinion fails to acknowledge that,
subsequent to Kake, the Supreme Court in Morton v. Ruiz, in articulating the
keystone to the Chevron doctrine, simultaneously recognized that Congress
intended for the Secretary of the Interior to play a major policy-making, rule-
making, and gap-filling role in effectuating its Indian-related statutes. The
Court plainly rejected an impracticably constrained view of the Secretary’s
powers in stating:
The power of an administrative agency to administer a
congressionally created and funded program necessarily requires
the formulation of policy and the making of rules to fill any gap left,
implicitly or explicitly, by Congress. In the area of Indian affairs,
the Executive has long been empowered to promulgate rules and
policies, and the power has been given explicitly to the Secretary
and his delegates at the BIA.
415 U.S. at 231-32 (footnotes citing and quoting 25 U.S.C. §§ 2 & 9 as authority
omitted).
Pursuant to its general authority under 25 U.S.C. §§ 2 & 9, recognized so
clearly by Morton v. Ruiz and later built upon in Chevron, the Secretary of the
Interior has successfully promulgated regulations governing activities across the
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spectrum of Indian affairs. See 25 C.F.R. § 23.1 (regulating child and family
service programs under the Indian Child Welfare Act); 25 C.F.R. § 89.30
(approval of legal contracts with certain tribes); 25 C.F.R. § 166.1 (imposing
grazing restrictions on tribal lands); 25 C.F.R. § 241.1 (regulating fishing on
certain reservations); 25 C.F.R. § 150.1 (regulating the recording, certification,
and use of title documents on tribal lands); 25 C.F.R. § 61.1 (regulating the
management of rolls and membership lists of Indian tribes); 25 C.F.R. § 83.1
(establishing procedures for determining whether a group constitutes an Indian
tribe).
Chief Judge Jones is further incorrect in suggesting that there is no
“statutory antecedent” to support the Secretary’s regulations at issue here under
the general authority statutes. The short answer to Chief Judge Jones’s
suggested complaint, of course, is that there is an obvious “statutory antecedent”
here - the IGRA itself, which clearly evinces Congress’s intent to empower the
Secretary to authorize Indians to conduct gaming businesses on tribal
reservations where not prohibited by general state laws and after giving states
a full and fair opportunity to bargain in good faith over the specific terms of the
individual tribal gaming regulations. It turns out, however, that her argument
in this respect is simply another version of her argument against implicit agency
authority, diametrically contrary to Chevron and Mead, to the effect that each
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separate Indian-related statute must explicitly authorize the Secretary to carry
it into effect, i.e., that the general authority statutes alone do not really do what
they purport to — empower the Secretary to prescribe regulations to effectuate
subsequent Indian-related statutes. The cases upon which the Chief Judge
relies, again, however, do not see her argument through. In the final analysis,
they stand only for the simple proposition that in order for the Secretary to use
his general authority under 25 U.S.C. §§ 2 and 9 to prescribe regulations to carry
a subsequent statute into effect, there must first be a statute or a treaty to
effectuate. See N. Arapahoe Tribe v. Hodel, 808 F.2d 741, 745-46 (10th Cir. 1987)
(holding that 25 U.S.C. § 9 could not be applied unless it was to carry “into effect
the various provisions of any act relating to Indian affairs,” but that a treaty
could in effect substitute for an act or statute); United States v. Michigan, 623
F.2d 448, 450 (6th Cir. 1980) (holding only that the requirement is not a difficult
one to meet and that a treaty can substitute for an “act relating to Indian
affairs”). The Chief Judge’s opinion plays a linguistic game, using the phrase
“statutory antecedent” to suggest that there must be some specific provision in
every Indian-related statute granting the authority to invoke sections 2 and 9 -
when, in fact, the courts have only logically required that some sort of statute or
law related to Indian affairs be extant before the Secretary can prescribe
regulations to carry it into effect. In other words, when Congress enacts a statute
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pertaining to Indian affairs and relations, but not before, it becomes the duty of
the President and the Secretary to exercise their powers under 25 U.S.C. § 2 &
9 to promulgate rules necessary to give it effect. Ruiz, 415 U.S. at 231.
Chief Judge Jones’s further assertion that “the fact that IGRA clearly
limited the Secretary’s intervention into Class III gaming compacts constitutes
the best evidence of congressional intent to limit the Secretary’s role” ignores the
reality of the situation here: that Congress enacted the statute without
foreknowledge of the Supreme Court’s decision in Seminole. That Congress did
not contemplate a need for the Secretary to prescribe an alternate tribal remedy
to fill a gap is merely a function of Congress’s failure to foresee the gap it was
leaving, i.e., Congress did not foresee that it lacked power under the Indian
commerce clause to abrogate state sovereign immunity and that, therefore, its
own statutorily prescribed tribal remedy of a federal court suit would prove to
be ineffectual. Congress’s lack of foreknowledge that the IGRA would prove to
be devoid of any constitutionally effective tribal remedy does not suggest in the
slightest that Congress anticipated or intended that the Secretary would default
in his duty to prescribe an alternate remedial procedure to carry the IGRA into
effect.
As with the general authority statutes, the role of the Interior under the
specific delegations of authority under the IGRA is far broader than what Chief
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Judge Jones’s opinion, focused as it is on a narrow section of the law, admits.
The IGRA authorizes the Secretary to approve or disapprove Tribal-State
compacts according to whether a compact complies with or violates the IGRA,
federal law or “the trust obligations of the United States to Indians.” 25 U.S.C.
§ 2710(d)(8)(B). Further, the IGRA specifically provides that “[i]f the State does
not consent ... to a proposed compact submitted by a mediator ..., the mediator
shall notify the Secretary and the Secretary shall prescribe, in consultation with
the Indian tribe, procedures ... which are consistent with ... the relevant
provisions of the laws of the State....” 25 U.S.C. § 2710(d)(7)(B)(vii) (emphasis
added) Thus, the IGRA contemplates that the Secretary of the Interior, and not
the federal or state courts or a mediator, shall perform the task of interpreting
state and federal laws and treaties to assure that a proposal or compact for
Indian gaming complies with them. Additionally, the Secretary is given powers
to review and approve or disapprove any plans by tribes to distribute revenue
from gaming to members of a tribe, and to evaluate such plans for whether they
comply with the IGRA’s goal of tribal economic development. See 25 U.S.C. §
2710(b)(3)(B).
Moreover, a number of regulatory powers are delegated to the Secretary
of the Interior through the National Indian Gaming Commission (“NIGC”), a
three-member body within the Department of the Interior. Tamiami Partners
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v. Miccosukee Tribe of Indians, 63 F.3d 1030, 1048 (11th Cir. 1995);
Seneca-Cayuga Tribe v. Nat’l Indian Gaming Comm’n, 327 F.3d 1019, 1023 (10th
Cir. 2003). Two of the three members of the NIGC are appointed directly by the
Secretary of the Interior. Tamiami, 63 F.3d at 1048. Congress plainly intends
the Department of the Interior to have broad authority over gaming in enacting
the IGRA, delegating to the NIGC the power to close an Indian gaming facility
permanently, to adopt regulations governing fines, to issue subpoenas, to inspect
the books and records of a Class II gaming facility, and to hold hearings. Id. The
NIGC is required to “monitor class II gaming continuously, inspect class II
gaming premises, promulgate regulations necessary to implement IGRA, and
conduct background investigations of, among others, management contractors.”
Id. While the NIGC is technically a distinct entity within the Department of the
Interior, the Secretary retains majority control over the board by appointing two
of its members. It is plain that the nominal separation of the two does not
change the clear intent of Congress to locate rulemaking and administrative
authority under the IGRA with the Secretary of the Interior. Indeed, after the
Tenth Circuit attempted to restrict the powers of the Interior by holding that the
IGRA delegated determinations of what constituted a reservation to the NIGC,
Sac & Fox Nation of Missouri v. Norton, 240 F.3d 1250 (10th Cir. 2001),
Congress immediately corrected the court and clarified that the Secretary of the
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Interior holds this power. City of Roseville v. Norton, 348 F.3d 1020, 1029-30
(D.C. Cir. 2003); Department of the Interior and Related Agencies
Appropriations Act, 2002, Pub. L. No. 107-63, § 134 (2001).
In view of all of the foregoing, it is “apparent from the agency’s generally
conferred authority and other statutory circumstances that Congress would
expect the agency to be able to speak with the force of law” with respect to any
gaps or ambiguities in the IGRA. Mead, 533 U.S. at 229. Chief Judge Jones’s
contention to the contrary is based on a narrow reading of a particular statutory
provision, exactly the kind of analysis forbidden by the Supreme Court. FDA v.
Brown & Williamson Tobacco Corp., 529 U.S. 120, 132 (2000) (holding that “a
reviewing court should not confine itself to examining a particular statutory
provision in isolation”).
VI.
Chief Judge Jones also incorrectly maintains that, under step two of the
Chevron analysis, the Secretarial Procedures regulations do not reasonably
effectuate Congressional intent with respect to the IGRA. Contrary to the
suggestion of Chief Judge Jones’s opinion, the Secretary’s regulations are not
only consistent with the intentions of Congress but are necessary to achieve the
intended “finely-tuned balance” that Seminole revealed Congress had
unintentionally failed to provide.
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The IGRA was enacted with more than the interests of the states in mind.
It was enacted “in large part to ‘provide a statutory basis for the operation of
gaming by Indian tribes as a means of promoting tribal economic development,
self-sufficiency, and strong tribal governments.’” TOMAC, Taxpayers of Mich.
Against Casinos v. Norton, 433 F.3d 852, 865 (D.C. Cir. 2006) (quoting 25 U.S.C.
§ 2702(1)). It was also designed to ensure that a tribe was the primary
beneficiary of any gaming operations. Citizens Exposing Truth About Casinos
v. Kempthorne, ___ F.3d ___, No. 06-5354, 2007 WL 1892080, at *1 (D.C. Cir.
Jul. 3, 2007). “IGRA was designed primarily to establish a legal basis for Indian
gaming as part of fostering tribal economic self-sufficiency, not to respond to
community concerns about casinos....” Id. at *10; San Manuel Indian Bingo and
Casino v. N.L.R.B., 475 F.3d 1306, 1308 (D.C. Cir. 2007) (holding that the
purpose of the IGRA was to ensure economic development and self-sufficiency
of Indian tribes through gaming).
While Congress did, as Chief Judge Jones asserts, intend that the
mechanism to introduce gaming would be a tribal-state compact, it did not
intend to allow, as the Seminole-blunted statute does, a situation in which states
could refuse to negotiate and thus veto a tribal-state compact. Under the IGRA
as passed by Congress, a state that failed to act in good faith, as Texas
indisputably has here, could be sued in federal court. 25 U.S.C. § 2710(d)(7).
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That state would have the burden of proving that it negotiated in good faith. Id.
at 2710(7)(B)(ii). If the state failed to meet its burden of proof, it would have
been ordered to negotiate a compact within 60 days. Id. at 2710(7)(B)(iii). If the
state continued to refuse to compact, it would have been forced into mediation.
Id. at 2710(7)(B)(iv). If the state ultimately refused to consent to the results of
the mediation, the Secretary of the Interior was empowered to bypass the state
and create its own procedures authorizing gambling by the tribe, consistent with
the compact proposed during mediation. Id. at 2710(7)(B)(vii).
It was thus not just the existence of a compact that was crucial to the
balance between states and tribes under the IGRA. “It is quite clear from the
structure of the statute that the tribe's right to sue the state is a key part of a
carefully-crafted scheme balancing the interests of the tribes and the states. It
therefore seems highly unlikely that Congress would have passed one part
without the other, leaving the tribes essentially powerless.” Spokane Tribe, 139
F.3d at 1300. The right to sue to essentially force a compact gave tribes a crucial
piece of leverage against the states - preventing a state from taking the approach
of Texas in this case, which has been to utterly refuse to negotiate. Prior to the
promulgation of the Secretarial Procedures regulations, states had under
Seminole’s constitutional interpretation a veto over the tribal-state compact
process. See Matthew L.M. Fletcher, Bringing Balance to Indian Gaming, 44
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HARV. J. ON LEGIS. 39, 75 (2007) (describing the stalemate resulting from the
elimination of Congress’s intended remedy for tribes faced with a state refusing
to negotiate). “Congress did not intentionally create this situation and would not
have countenanced it had it known then what we know now.” Spokane Tribe,
139 F.3d at 1302.
Chief Judge Jones’s opinion gives lip-service to the deference accorded
under Chevron at step two to the Secretary’s Procedures regulations, noting
correctly that we may not disturb the agency’s decision “unless it appears from
the statute or legislative history that the accommodation is not one that
Congress would have sanctioned.” Chevron, 467 U.S. at 845. We do not ask
whether the Procedures regulations are ideal, or whether there is some way they
can be improved. Mead, 533 U.S. at 229 (holding that “a reviewing court has no
business rejecting an agency’s exercise of its generally conferred authority to
resolve a particular statutory ambiguity simply because the agency’s chosen
resolution seems unwise”). We do not ask whether Congress would have modified
them in some minor way. We ask only whether they were reasonable and
whether Congress would have sanctioned them. Chevron, 467 U.S. at 845. To
focus on the minutiae, as Chief Judge Jones’s opinion does, distracts from the
general intentions of Congress in passing the IGRA: Congress intended to allow
Indian gaming to proceed, for the purpose of economically benefitting Indian
69
tribes, after a negotiating process that would give states a right to negotiate
towards the ultimate outcome. In the case of a state that attempted to halt or
veto this process without good faith, Congress intended that tribes would
ultimately be able to force gaming even over the objections of the state. The
Secretary’s regulations at issue here may not be perfect, but by allowing tribes
an alternate process to propose gaming procedures in cases where a state refuses
to negotiate and refuses to be sued in federal court, they closely approximate
what Congress likely would have intended, while the status quo after Seminole
undisputedly subverts the national legislative aims in respect to Indian affairs
and relations.
Even on its discussion of the details, Chief Judge Jones’s opinion is
misguided. It first argues that the Procedures are unreasonable because they
eliminate the requirement that a federal court determine whether the state has
negotiated in good faith. But this criticism based on the idea that the Secretary’s
regulations deny the State of Texas access to an impartial federal court fact-
finder rings hollow given that the Secretary’s alternate remedy regulations are
triggered only if the state has asserted its Eleventh Amendment right not to be
sued in federal court by an Indian tribe under the original statutory procedures
enacted by Congress. 25 C.F.R. § 291.3. Under the Secretary’s alternate remedy
regulations, a state that prefers that a federal court resolve its dispute with the
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tribe may simply choose that option, waiving its objection to federal jurisdiction
and proceeding exactly as Congress originally intended. The State of Texas, after
categorically refusing to negotiate with the Kickapoo and after asserting its
sovereign immunity in federal court when the Kickapoo attempted to invoke the
original statutory procedures, now resorts to a federal court complaining that it
is crucial that a federal court serve as an independent body to determine
whether its absolute refusal to negotiate constituted “negotiations in good faith.”
The Procedures do not deny a state its right to a judicial determination as to
whether it acted in good faith, because the state may choose to submit to a
federal court’s jurisdiction by allowing a tribe to sue it there; just as it has in the
present case by bringing this suit in federal court. That Texas is well aware that
a fair and impartial federal court would be unlikely to find that its utter refusal
to negotiate amounted to good-faith bargaining does not obviate its undisputed
right to litigate that matter in federal court.
Moreover, Congress contemplated the “good faith” determination as an
affirmative defense, with the burden on the state to prove that it negotiated in
good faith. 25 U.S.C. § 2710(d)(7)(B)(ii). The Secretary’s alternate tribal remedy
regulations require that the tribe has negotiated with a state for a six-month
period prior to invoking the Secretarial Gaming Procedures. 25 C.F.R. § 291.3(b).
A state must also have asserted its sovereign immunity defense against a suit
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by the tribe. Id. at 291.3(d). The Procedures give the state a 60-day comment
period, and invite it to submit an alternate gaming proposal. Id. at 291.7(b).
They invite the state to participate in an informal conference with the tribe. Id.
at 291.8(b). Only after mediation may the Secretary attempt to actually impose
a proposal over the state’s objection. Id. at 291.11. It seems unlikely that a state,
negotiating in good faith, would fully proceed through this process without
coming to some agreement with the tribe. A good faith determination might
improve these procedures from a policymaking perspective, but that question is
not one for this court under Chevron. We ask only whether the Secretary’s
regulations are reasonable and whether Congress would have sanctioned them -
and it seems unlikely, given the Congressional goal of allowing and promoting
lawful Indian gaming businesses, that Congress would not sanction these
regulations closely tracking and complementing the original statute, rendered
ineffective by Seminole, with an alternate remedy that is absolutely essential to
its having the Congressional effect intended.
Chief Judge Jones’s second contention is that the Secretarial Gaming
Procedures regulations create a biased mediation process by allowing the
Secretary of the Interior, rather than a court, to appoint a mediator who has “no
official, financial, or personal conflict of interest with respect to the issues in
controversy.” 25 C.F.R. § 291.9(a). Chief Judge Jones’s suggestion that the
72
Interior is placed in the role of an “objective arbiter” is incorrect - instead, the
person appointed as a mediator is the fair and impartial decider. Unfounded
speculation that the Secretary might not perform his plain duty under the
statutes and his own department’s regulations to select a neutral mediator fails
to justify a conclusion that the regulations are unreasonable - especially given
that for Chief Judge Jones’s fears to materialize, not only must the Secretary
violate his duty, but the neutral mediator must as well.
Chief Judge Jones’s third contention, that the Secretary is enabled to
simply disregard the mediator’s proposal, exaggerates the Secretary’s powers
under the Procedures. The Secretary may not establish his own procedures
unless he does not approve the mediator’s proposal. The Secretary may not
disapprove the mediator’s proposal unless it violates federal or state law,
violates the trust obligations to the tribe, or does not comply with the technical
requirements of a proposal. 25 C.F.R. § 291.11. In the event that the Secretary
disapproves, he may prescribe his own procedures - but only if they “comport
with the mediator’s selected proposal as much as possible....” Id. at 291.11(c).
This differs only slightly from the statutory requirement that the procedures be
“consistent with the proposed compact selected by the mediator....” 25 U.S.C. §
2710(d)(7)(B)(vii). Moreover, it is unclear which of the two is the more restrictive
73
on the Secretary - and the regulations certainly do not grant “unbridled power
to prescribe Class III regulations.”
Chief Judge Jones’s final argument combines her previous three into a
grand petitio principii. That is, she begs the question by contending that
Congress would not have expected the Secretary to fill the unforeseen gap it left
in the IGRA’s tribal remedy unless he included the requirements that made it
unintentionally unenforceable in the first place---a federal court’s determination
of a state’s failure to bargain in good faith, the participation of a federal court-
appointed mediator, and gaming procedures consistent with a federal court-
appointed mediator’s proposed compact. Yet we are not inquiring into whether
Congress “intended” or could foresee the result reached by the Secretary in
filling Congress’s own unforeseen and unintended gap. We instead ask whether
the result is a reasonable one that Congress would sanction by the agency it had
empowered to make rules and policies to effectuate its acts regarding Indian
affairs and relations for purposes of complementing or filling the gap in the
statute. Chevron, 467 U.S. at 845. Congress intended for recalcitrant states to
be subjected to suit by Indian tribes in federal court - but that intended tribal
remedy was frustrated by the unforeseen constitutional interpretation in
Seminole. I conclude that, if Congress had known that it lacked power to
abrogate state sovereignty under the Indian commerce clause, it obviously would
74
have adopted at least some alternate form of remedy - and that it would likely
have enacted something similar to the Secretarial Gaming Procedures
regulations, as a reasonable and necessary alternate tribal remedy. Otherwise,
if this reasonable and practicable proposition cannot be laid, we are faced with
a preposterous alternative conclusion, viz., that Congress would have declined
to adopt the IGRA in any form or would have included a veto power for hostile
states in a statute designed “to provide a statutory basis for the operation of
gaming by Indian tribes as a means of promoting tribal economic development,
self-sufficiency, and strong tribal governments.”3 25 U.S.C. § 270(1).
3
Chevron is not the only potential source of deference
owed to the regulations. The Indian canon of construction provides
that because of the trust relationship between the federal
government and the tribes, statutes “are to be construed liberally
in favor of the Indians, with ambiguous provisions interpreted to
their benefit.” County of Yakima v. Confederated Tribes & Bands of
Yakima Indian Nation, 502 U.S. 251, 269 (1992) (quoting Montana v.
Blackfeet Tribe, 471 U.S. 759, 766 (1985)). The precise
relationship between this canon of construction and the Chevron
doctrine has not been resolved. Several circuits, however, have
held that when the two principles of deference are in conflict, the
Indian canon trumps the Chevron doctrine, requiring deference to
the interpretation that is most favorable to the Indian tribes. See
Scott C. Hall, The Indian Law Canons of Construction v. The Chevron
Doctrine: Congressional Intent and the Unambiguous Answer to the
Ambiguous Problem, 37 CONN. L. REV. 495 (2004); Cobell v. Norton,
240 F.3d 1081, 1101 (D.C. Cir. 2001) (holding that the Indian canon
prevailed over the Chevron doctrine when the two were in conflict).
There is no need to ponder the precise relationship of the two
principles in this case, however, because they are not in conflict
but concurrently call for judicial deference toward the Secretary’s
gaming procedures regulations that are necessary to carry the IGRA
into full effect. Thus, at a minimum, the Indian canon adds
substantially to the level of deference owed to the Secretary’s
Procedures regulations in this case. Chief Judge Jones makes
unwarranted assumptions about the intent of Congress that are not
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VII.
In sum, this reviewing court has no business rejecting the Secretary’s
exercise of his generally conferred authority to fill a particular statutory gap
simply because it deems the Secretary’s chosen resolution to be unwise, but
instead is obliged to accept the Secretary’s position because Congress has not
spoken to the point or gap at issue here and the Secretary’s interpretation is
reasonable. Further, the circumstances here imply that Congress would expect
the Secretary to be able to speak with the force of law, even though Congress
may not have expressly delegated authority or responsibility to implement a
particular provision; the power of an administrative agency to administer a
congressionally created and funded program necessarily requires the
formulation of policy and the making of rules to fill any gap left, implicitly or
explicitly, by Congress. The Secretary therefore acted within his authority to
promulgate regulations filling an unanticipated statutory gap under the explicit
authority of 25 U.S.C. §§ 2 and 9 and the implicit authority of the IGRA, and his
ensuing regulations are owed Chevron deference and are binding in the courts
because they are not procedurally defective, arbitrary or capricious in substance,
consistent with the obvious gap it unintentionally left in the IGRA
along with the requirement that we generously construe any
regulation by the Secretary to fill it in favor of the IGRA’s
effectuation, and with IGRA’s furtherance of tribal economic
development and self-sufficiency in light of Congress’s unique
trust relationship with the Indians.
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or manifestly contrary to the statutes. Accordingly, I DISSENT.
77