F I L E D
United States Court of Appeals
Tenth Circuit
NOV 23 2004
PUBLISH
PATRICK FISHER
UNITED STATES COURT OF APPEALS Clerk
TENTH CIRCUIT
NORTHERN ARAPAHO TRIBE,
Plaintiff-Appellee/
Cross-Appellant,
v.
Nos. 02-8026
STATE OF WYOMING and 02-8031
GOVERNOR JIM GERINGER, his
agents, employees and successors, in
their official capacities,
Defendant-Appellants/
Cross-Appellees.
Appeal from the United States District Court
for the District of Wyoming
(D.C. No. 00-CV-221-J)
Craig E. Kirkwood, Senior Assistant Attorney General (Patrick J. Crank, Attorney
General, and John W. Renneisen, Deputy Attorney General, with him on the
briefs), Cheyenne, Wyoming, for Defendants-Appellants/Cross-Appellees.
Andrew W. Baldwin, Baldwin & Crocker, P.C., Lander, Wyoming, for Plaintiff-
Appellee/Cross-Appellant.
Before SEYMOUR, HENRY and LUCERO, Circuit Judges.
SEYMOUR, Circuit Judge.
The Northern Arapaho Tribe brought an action seeking a declaration that
the state of Wyoming failed to negotiate in good faith with the Tribe in violation
of the Indian Gaming Regulatory Act (IGRA), 25 U.S.C. §§ 2701 et seq. Partially
granting the Tribe’s motion for judgment on the pleadings, the district court held
that Wyoming failed to negotiate in good faith with regard to calcutta and
parimutuel wagering and ordered the parties to complete a compact within sixty
days. The court further held that casino-style gaming and slot machine wagering
were against Wyoming public policy and thus not subject to negotiation. Both
parties appeal. We affirm in part and reverse in part.
I
The Northern Arapaho Tribe is a federally recognized Indian tribe with a
reservation in the State of Wyoming. Under the IGRA, a tribe must negotiate
with the state and enter into a “tribal-state” compact in order to engage in gaming
on Indian lands. 25 U.S.C. § 2710(d)(1)(C). Seeking to engage in a casino-style
gaming operation on the Wind River Indian Reservation, the Tribe submitted a
written request to the state for tribal-state compact negotiations.
The Tribe submitted a proposal to the state under which it would be entitled
to operate gaming and gaming machines including poker, video poker, roulette,
dice games, sportsbook, parimutuel, wheel of fortune, keno, video keno,
raffle/lottery, multi-line slot, regular slot, blackjack, video blackjack, video pull-
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tab, and video horse racing. In response, the state took the position that because
Wyoming has a broad criminal prohibition against gambling and exceptions to
that prohibition are narrowly drawn, the IGRA requires it to negotiate only
regarding the games that Wyoming law specifically permits for commercial
purposes. According to the state, the compact negotiations with the Tribe were
thus limited to raffles, bingo, pull tabs, calcuttas, and parimutuel wagering.
The Tribe disagreed, claiming that Wyoming was required to negotiate
regarding all games listed in the Tribe’s proposed compact because state law
permitted a nearly unlimited variety of gaming, including “any game, wager or
transaction,” albeit only for social or non-profit purposes. W YO . S TAT . §
6-7-101(a)(iii)(E). Over one hundred eighty days passed without a gaming
compact, prompting the Tribe to file suit seeking a declaration that Wyoming had
failed to negotiate in good faith in violation of the IGRA. See 25 U.S.C. §
2710(d)(7)(B)(i). In addition, the Tribe requested the court to order the state to
enter into a tribal-state compact within sixty days. Id. § 2710(d)(7)(B)(iii). In the
alternative, the Tribe sought an injunction to prevent the state from interfering
with the Tribe’s alleged right to conduct or regulate class III gaming on Indian
lands within Wyoming.
The district court partially granted a motion for judgment on the pleadings
in favor of the Tribe, holding that the state’s refusal to bargain on calcutta or
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parimutuel wagering, other than in strict conformity with state law restrictions
that do not apply to tribes under the IGRA, constituted a failure to negotiate in
good faith. The court further held, however, that the state was not required to
negotiate regarding “casino-style” games or “gaming machines,” notwithstanding
Wyoming’s permissiveness in allowing casino-style gambling for social purposes.
The court ordered the parties to enter into a compact within sixty days with regard
to calcutta and parimutuel betting.
II
We review the district court’s grant of a judgment on the pleadings de
novo, applying the same standard of review applicable to a Rule 12(b)(6) motion
and construing the pleadings and the reasonable inferences therefrom in the light
most favorable to the non-moving party. Aspenwood Investment Co. v. Martinez,
355 F.3d 1256, 1259 (10th Cir. 2004).
The IGRA was enacted in 1988 in order to “promot[e] tribal economic
development, self-sufficiency, and strong tribal governments.” 25 U.S.C. §
2702(1). The statute provides a comprehensive system to regulate gambling
activities on Indian lands. See id. §§ 2701-2721. The IGRA explicitly states that
“Indian tribes have the exclusive right to regulate gaming activity on Indian lands
if the gaming activity is not specifically prohibited by Federal law and is
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conducted within a state which does not, as a matter of criminal law and public
policy, prohibit such gaming activity.” Id. § 2701(5). This declaration is
consistent with Supreme Court’s seminal pre-IGRA decision:
if the intent of a state law is generally to prohibit certain conduct, it falls
within [the state’s] criminal jurisdiction, but if the state law generally
permits the conduct at issue, subject to regulation, it must be classified as
civil/regulatory . . . . The shorthand test is whether the conduct at issue
violates the State’s public policy.
California v. Cabazon Band of Mission Indians, 480 U.S. 202, 209 (1987).
Accordingly, the primary issue in this case is whether “such gaming activity” in
which the Northern Arapaho Tribe wishes to engage is “prohibited” or merely
regulated by the state of Wyoming.
The IGRA divides Indian gaming into three classes: “Class I games” (social
games solely for prizes of minimal value or traditional forms of Indian gaming);
“Class II games” (bingo, including pull-tabs, lotto, punch boards, tip jars, instant
bingo, other games similar to bingo, and certain card games); and “Class III
games” (all other gaming including roulette, blackjack, and parimutuel wagering).
See 25 U.S.C. § 2703(6)-(8). Class I games are not subject to regulation under
the IGRA. Id. § 2710(a). Class II games are permitted on Indian lands under the
IGRA if the game is conducted within a state that permits Class II gaming “for
any purpose by any person, organization or entity.” Id. § 2710(b). Class III
gaming activities are “lawful on Indian lands only if such activities are . . . (A)
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authorized [by an approved Tribal] ordinance or resolution . . . , (B) located in a
State that permits such gaming for any purpose by any person, organization, or
entity, and (C) conducted in conformance with a Tribal-State compact . . . .” Id. §
2710(d) (emphasis added). In order to engage in Class III gaming activities, the
Tribe must “request the State in which such lands are located to enter into
negotiations for the purpose of entering into a Tribal-State compact governing the
conduct of gaming activities.” Id. § 2710(d)(3)(a). The state must negotiate in
good faith with the tribe upon receipt of such a request. Id.
The controversy between the Tribe and the state of Wyoming centers on the
phrase “located in a State that permits such gaming for any purpose by any
person, organization, or entity.” Id. § 2710(d)(1)(B). As the district court
detailed in its opinion, this statutory language has spawned at least two different
approaches regarding the scope of negotiations required between tribes and states
under the IGRA.
The “Wisconsin” analysis or “categorical” approach requires courts to first
review the general scope of gaming permitted by the state. See, e.g., Lac du
Flambeau Band of Lake Superior Chippewa Indians v. Wisconsin, 770 F. Supp.
480 (W.D. Wis. 1991). If the state permits any form of Class III gaming, the tribe
must negotiate to offer all forms of Class III gaming because the state is merely
“regulating,” rather than “prohibiting,” this type of gambling. Id. at 484-88. This
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categorical approach has been adopted by at least one circuit. See Mashantucket
Pequot Tribe v. Connecticut, 913 F.2d 1024, 1031-32 (2d Cir. 1990).
The “Florida” analysis or “game-specific” approach requires courts to
review whether state law permits the specific game at issue. See, e.g., Coeur
d’Alene Tribe v. Idaho, 842 F. Supp. 1268, 1278 (D. Idaho 1994) (citing Seminole
Tribe of Florida v. Florida, 1993 WL 475999 (S.D. Fla. Sept. 22, 1993)). If the
state allows a particular game for any purpose, it must negotiate with the tribe
over that specific game. Id. at 1279-80. Similarly, if the state entirely prohibits a
particular game, the state is not required to negotiate with the Tribe as to that
game, even if the state permits other games in the same category. Id. Under this
approach, the state’s permissive treatment as to one type of Class III game does
not mean that the state must negotiate with tribes as to all Class III games. At
least two circuits follow the “game-specific” approach. See Rumsey Indian
Rancheria of Wintun Indians v. Wilson, 64 F.3d 1250, 1257-58 (9th Cir. 1994);
Cheyenne River Sioux Tribe v. South Dakota, 3 F.3d 273, 278-79 (8th Cir. 1993).
The district court specifically adopted the “Florida” or “game-specific”
approach. We need not decide whether to follow the Wisconsin or Florida
analysis regarding the scope of gaming under the IGRA because we conclude that
Wyoming must negotiate with the Tribe under either approach regarding the full
gamut of “any game, wager or transaction,” W YO . S TAT . § 6-7-101(a)(iii)(E).
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In order to determine the appropriate scope of negotiations between the
Tribe and the state under either analysis, it is critical to determine the scope of
gaming permitted by state law. Under Wyoming law, Class III calcutta wagering
is permitted on “amateur contests, cutter horse racing, dog sled racing,
professional rodeo events or professional golf tournament[s]” if “conducted by a
bona fide nationally chartered veterans’, religious, charitable, educational or
fraternal organization or non-profit local civic or service club . . . .” W YO . S TAT .
§ 6-7-101. For-profit parimutuel wagering is permitted on specified events so
long as the profits are limited to 25.90% of the total wagers per event. Id. §
11-25-102.
The district court held that because Wyoming law specifically authorizes
calcutta and parimutuel wagering, the state is required to negotiate with the Tribe
regarding the full gamut of those types of games. The fact that calcutta wagering,
under state law, may only be conducted by incorporated non-profit groups for
non-profit purposes is inapposite: the tribe is not limited to “just wagering subject
to the conditions of W YO . S TAT . § 6-7-101(a)(iii)(F) and 11-25-105.” Aplt. App.
at 139. In other words, the district court held that state law “person” or “purpose”
restrictions on calcutta or parimutuel wagering do not apply to tribes under the
IGRA.
The state argues that the district court erred in concluding the IGRA
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requires the state to negotiate with the Tribe as to calcutta and parimutuel
wagering without regard to the limitations of Wyoming law. If the state’s
approach were correct, however, “[t]he compact process that Congress established
as the centerpiece of the IGRA’s regulation of Class III gaming would thus
become a dead letter; there would be nothing to negotiate, and no meaningful
compact would be possible.” Mashantucket Pequot Tribe, 913 F.2d at 1031.
Furthermore, “the legislative history [of the IGRA] reveals that Congress intended
to permit a particular gaming activity, even if conducted in a manner inconsistent
with state law, if the state law merely regulated, as opposed to completely barred,
that particular gaming activity.” United States v. Sisseton-Wahpeton Sioux Tribe,
897 F.2d 358, 365 (8th Cir. 1990) (emphasis added).
It is clear under Wyoming law that the state regulates, rather than prohibits,
calcutta and parimutuel wagering. Thus, the IGRA’s requirement that Class III
gaming be “located in a State that permits such gaming for any purpose by any
person, organization, or entity” is fulfilled. 25 U.S.C. § 2710(d)(1)(B). The state
is therefore clearly required to conduct negotiations with the Tribe concerning the
full gamut of calcutta and parimutuel wagering.
With regard to the broader issue of other casino-style Class III gambling,
the district court recognized that Wyoming allows such activities because it
permits “any game, wager or transaction” for social and non-profit purposes.
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W YO . S TAT . § 6-7-101(a)(iii)(E). The court stated that “[u]nder a straightforward
Florida analysis, Wyoming would have to negotiate over casino-style gambling
with the Arapaho because it allows such gaming for any purpose; namely, a social
one.” Aplt. App. at 140. Nonetheless, the court held the state was not required to
negotiate regarding casino-style gambling. Forcing the state to do so simply
because Wyoming permits social gambling, the court concluded, would lead to an
“absurd result.” Id. at 140-42. We disagree.
As the district court acknowledged with respect to calcutta and parimutuel
wagering, if gaming is permitted by a state “for any purpose by any person,” such
gaming is lawful on Indian land without the restrictions otherwise imposed on
off-reservation gaming as a matter of state law. 25 U.S.C. § 2710(d)(1). The
Tribe contends that because the state broadly permits any casino-style gaming for
social and non-profit purposes, it is required to negotiate with the Tribe
concerning the full gamut of “any game, wager or transaction.” W YO . S TAT . § 6-
7-101(a)(iii)(E).
The state argues that its limited authorization of casino-style gambling for
social purposes does not amount to a general allowance of “such gaming” within
the contemplation of the IGRA. 25 U.S.C. § 2710(d)(1)(B) (Class III gambling is
lawful if “located in a State that permits such gaming for any purpose by any
person, organization, or entity”). The state apparently claims that the appropriate
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baseline category to which the term “such gaming” refers is neither all Class III
gambling games nor all casino-style gambling games, but rather the subset of
specific Class III games at issue—in this instance, casino-style gambling games
for non-commercial purposes. The state’s argument fails under either the
Wisconsin or Florida analysis.
Under the Wisconsin or “categorical” approach, the state must negotiate
concerning all forms of Class III gaming because Wyoming permits and regulates
“such gaming,” albeit only for social and non-profit purposes. Under the Florida
or “game-specific” approach, the state must negotiate regarding the broad
category of “any game, wager or transaction” because the state specifically
permits and regulates all types of “such gaming” for certain purposes by certain
people and organizations. We are aware of no court that has approved a state law
restriction against gaming “for-profit,” “professionally,” or anything similar when
the state permits the same type of gaming for social and non-profit purposes.
Instead, courts have rejected states’ attempts to limit negotiations with Tribes due
to state law restrictions against commercial gaming. See, e.g., Mashantucket
Pequot Tribe, 913 F.2d at 1032 (holding that limited permission by state for
occasional, charitable gaming does not preclude commercial gambling by Tribe
under the IGRA); Ysleta Del Sur Pueblo v. Texas, 852 F. Supp. 587, 595-96
(W.D. Tex. 1993) (holding that limited permission for only social gaming under
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state law does not preclude commercial gambling the Tribe seeks under the
IGRA), rev’d on other grounds, 36 F.3d 1325 (5th Cir. 1994). In sum, if a state
permits Class III gaming under the “Wisconsin” approach, or if a state permits
any specific games (here, all games) in any fashion under the “Florida” approach,
that state must negotiate a compact for those games even if state law restricts the
sponsors or purposes of such gaming. The district court erred in concluding to
the contrary.
Finally, the state contends the Tribe produced no evidence that the state
failed to respond in good faith to the request of the Tribe to negotiate a compact.
The district court held that because (1) Wyoming had a duty to negotiate for terms
beyond those Wyoming law expressly permits and (2) the state conceded that it
only negotiated to the extent that Wyoming law permitted parimutuel and calcutta
gaming, the state had not negotiated in good faith. We agree.
The IGRA provides that:
upon the introduction of evidence by an Indian tribe that . . . (I) a Tribal-
State compact has not been entered into . . . and (II) the State did not
respond to the request of the Indian tribe to negotiate such a compact or did
not respond to such request in good faith, the burden of proof shall be upon
the State to prove that the State has negotiated with the Indian tribe in good
faith to conclude a Tribal-State compact governing the conduct of gaming
activities.
25 U.S.C. § 2710(d)(7)(B)(ii). The Tribe alleged and the state conceded that
Wyoming only negotiated regarding “raffles, bingo, pull tabs, calcuttas, and
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parimutuel wagering” and only to the extent state law permits such activities.
When a state refuses to negotiate beyond state law limitations concerning a game
that it permits, the state cannot be said to have negotiated in good faith under the
IGRA given the plain language of the statute. Moreover, “when a state wholly
fails to negotiate,” as Wyoming did here concerning casino-style gambling, “it
obviously cannot meet its burden of proof to show that it negotiated in good
faith.” Mashantucket Pequot Tribe, 913 F.3d at 1032.
The judgment of the district court is AFFIRMED in part, REVERSED in
part, and REMANDED for further proceedings in accordance with this opinion.
Appellee’s motion to file a supplemental appendix is granted.
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