TAMIAMI PARTNERS, LTD. by and through TAMIAMI DEVELOPMENT CORP., its general partner,
Plaintiff-Appellee,
v.
MICCOSUKEE TRIBE OF INDIANS OF FLORIDA; Billy Cypress; Jasper Nelson; Jimmie Bert; Max
Billie; Henry Bert; and Dexter Lehtinen, Defendants-Appellants.
No. 96-5262.
United States Court of Appeals,
Eleventh Circuit.
June 7, 1999.
Appeals from the United States District Court for the Southern District of Florida. (No. 92-489-CV-SH),
Shelby Highsmith, Judge.
Before TJOFLAT and BIRCH, Circuit Judges, and RONEY, Senior Circuit Judge.
TJOFLAT, Circuit Judge:
This case, which is making its third appearance before our court,1 is the result of a protracted
contractual dispute between the Miccosukee Tribe of Indians of Florida ("the Tribe") and Tamiami Partners,
Ltd. ("Tamiami"). The most recent incarnation of this dispute is Tamiami's second amended complaint
against the Tribe as well as against the Tribe's attorney and several officers of the Tribe's Business Council
and Gaming Agency (collectively, the "individual defendants"). In the district court, all of the defendants
filed motions to dismiss Tamiami's second amended complaint on the following grounds: lack of subject
matter jurisdiction, sovereign immunity, and failure to state a claim. The defendants bring this interlocutory
appeal from the district court's order denying their motions. Because of this procedural posture, we consider
only the issues of subject matter jurisdiction and sovereign immunity. With one minor exception, see infra
1
The dispute between these parties has not been confined solely to federal court. See, e.g.,
Cypress v. Tamiami Partners, Ltd., 662 So.2d 1292 (Fla. 3d DCA 1995) (quashing discovery order on
basis of sovereign immunity); Mandel v. Miccosukee Tribal Gaming Agency, No. CV 93-18, 22 Indian L.
Rep. 6148 (Miccosukee Tribal Ct. Jan. 31, 1994) (affirming denial of gaming license applications by
Gaming Agency); In re Conservatorship for Miccosukee Indian Bingo, No. CV 93-11 (Miccosukee
Tribal Ct. Apr. 13, 1993) (enforcing Gaming Agency order appointing conservator); Miccosukee Tribe of
Indians v. Tamiami Partners, Ltd., No. CV 92-07 (Miccosukee Tribal Ct. July 16, 1992) (directing parties
to arbitrate their disputes).
part III.B., we affirm the district court's order on these issues with respect to the Tribe. As to the individual
defendants, however, we hold that the doctrine of Ex parte Young does not allow Tamiami to defeat their
claims of sovereign immunity.
I.
A.
Because our prior opinions discuss the facts and initial procedural history of this case in detail, we
provide only a summary here.2 On April 7, 1989, the Tribe entered into a Management and Economic
Development Agreement (the "Agreement") with Tamiami Development Corporation ("TDC") to operate a
bingo gaming facility on Tribal lands under a gaming scheme authorized by the Indian Gaming Regulatory
Act ("IGRA"), 25 U.S.C. §§ 2701-2721 (1994), and a 1985 tribal ordinance. The Agreement had a
seven-year term and was renewable by TDC, at its option, for an additional three years. In exchange for forty
percent of the facility's monthly "net revenues," TDC agreed to purchase a parcel of real estate (outside the
Miccosukee reservation), convey the parcel to the United States in trust for the Tribe, and then design,
construct, and manage a bingo facility on that parcel.
Two provisions of the Agreement are particularly relevant here. Article 12 provides that "[a]ll
disputes, controversies and/or claims arising out of or relating to this Agreement, or the breach thereof, shall
be settled by arbitration...." Under Article 23 of the Agreement, the Tribe waived its common-law immunity
from a suit brought by TDC either to compel arbitration under Article 12 or to enforce an arbitration award.
Article 23 states:
The [Tribe] waives its sovereign immunity from suit as expressly provided in this Article. The
United States District Court for the Southern District of Florida, shall have jurisdiction over the
parties hereto in order to enforce the terms hereof specifically, upon one or both of the following
events (i) [the Tribe] fails to participate in an arbitration proceeding invoked as provided in Article
2
Most of the facts we recite in part I are drawn from the record in this case and from our prior
opinions. See Tamiami Partners, Ltd. v. Miccosukee Tribe of Indians, 63 F.3d 1030 (11th Cir.1995);
Tamiami Partners, Ltd. v. Miccosukee Tribe of Indians, 999 F.2d 503 (11th Cir.1993). We occasionally
draw upon the allegations in Tamiami's second amended complaint, which we accept as true in reviewing
the defendants' motions to dismiss. See Jackson v. Okaloosa County, 21 F.3d 1531, 1534 (11th
Cir.1994).
12, or (ii) failure by [the Tribe] to abide by the terms of an arbitration award.... This waiver of
sovereign immunity shall not become effective until [TDC] has given written notice to the
Miccosukee Tribal Business Council, detailing the nature of the complaint and the [Tribe] shall have
failed after 30 days following such notice to cure such complaint.
After the Agreement was approved by a designee of the Secretary of the Interior, TDC purchased the
parcel and began to construct the bingo facility. On January 23, 1990, with the Secretary's approval, the
parties effected a novation of the Agreement in order to substitute Tamiami—a Florida limited partnership
of which TDC was the general partner—for TDC. Thereafter, Tamiami completed the facility and began
operating it as Miccosukee Indian Bingo ("MIB") in September 1990. On August 9, 1991, the Tribe adopted
an ordinance establishing a Tribal Gaming Agency to oversee the registration and licensing of the managers
and key employees of its gaming enterprises, including the facility managed by Tamiami. Under this
ordinance, the denial of a license would result in termination of employment and eviction from the gaming
facility.
During the first sixteen months of MIB's operation, the Tribe made two separate offers to purchase
Tamiami's interest in the facility. The highest offer was for an amount equal to Tamiami's initial investment
in the facility. Tamiami rejected both offers. On January 28, 1992, the Tribe notified Tamiami by letter that
the Agreement had been "terminated by action of the [Tribe's] Business Council ... effective 30 days from
the date hereof, because of repeated and flagrant violations of the letter and spirit of that Agreement." On
February 25, pursuant to Article 12 of the Agreement, Tamiami formally demanded arbitration "to determine
the validity of the Tribe's purported notice of termination." The Tribe responded by filing a "Statement of
Claim" in Miccosukee Tribal Court to obtain a declaration that the Agreement had been terminated. On
February 27, Tamiami initiated this lawsuit by filing its original verified complaint against the Tribe in the
United States District Court for the Southern District of Florida. This complaint sought a declaratory
judgment that Article 12 of the Agreement bound the Tribe to settle all disputes by arbitration, as well as an
injunction compelling the Tribe to arbitrate the termination dispute and preventing it from taking control of
MIB pending the completion of such arbitration.
On March 5, 1992, the district court issued its first "omnibus order" in the case. As a threshold
matter, the court determined that it had subject matter jurisdiction because the case presented the question of
Tribal Court power over a non-Indian. It stayed further proceedings in the case, however, pending either the
parties' exhaustion of their remedies in the Tribal Court or any action by the Tribe to evict or otherwise
impede Tamiami from operating MIB. See Tamiami Partners, Ltd. v. Miccosukee Tribe of Indians, 788
F.Supp. 566 (S.D.Fla.1992).
On July 16, 1992, the Tribal Court issued a ruling that directed the parties to initiate arbitration
proceedings in accordance with the Agreement. During that same month, the Tribe denied seventeen license
applications that Tamiami employees had submitted to the Tribal Gaming Agency. Tamiami responded by
filing a motion asking the district court to enjoin the Tribe from exercising self-help in order to terminate the
Agreement. Tamiami alleged in its motion that the Tribe, under the pretext of issuing legitimate license
denials, was engaging in self-help in order to prevent Tamiami from operating MIB and thus effectively
terminate the Agreement. In its second omnibus order, issued on August 19, the district court addressed this
motion. The court found that the Tribe's licensing process was arbitrary and capricious under the
Administrative Procedure Act. Nevertheless, the court concluded that Congress, in enacting IGRA, had made
no provision for suits by management contractors (such as Tamiami) to challenge a Tribe's licensing
procedures. Moreover, it held that the Tribe's narrow waiver of sovereign immunity did not constitute
consent to federal court suits challenging its licensing process. For these reasons, the court denied Tamiami's
motion. See Tamiami Partners, Ltd. v. Miccosukee Tribe of Indians, 803 F.Supp. 401 (S.D.Fla.1992).
On August 21, Tamiami moved the district court for leave to file a "supplemental" complaint and for
a preliminary injunction that would compel arbitration of the licensing dispute and prevent the Tribe from
using the licensing process to frustrate Tamiami's operation of MIB. The court denied this motion on
September 15. Thereafter, Tamiami took interlocutory appeals from the district court's August 19 and
September 15 orders.
An arbitration panel eventually was convened on December 17, 1992. On April 13, 1993, while the
interlocutory appeals and arbitration were pending, the Tribe took several steps to oust Tamiami from MIB.
The Tribal Gaming Agency denied licenses to Tamiami, TDC, and two of TDC's principal officers—Cye
Mandel and John Sisto. The Gaming Agency also appointed a conservator to take control of MIB and to
operate the facility; the conservator was instructed to pay the Tribe its share of MIB's net revenues and to
deposit Tamiami's forty percent share into a trust account at Jefferson National Bank in Miami, Florida. The
Tribal Court ratified the conservator's appointment the same day. The Tribal police then forced Mandel and
Sisto to leave the MIB premises, the MIB accountant surrendered MIB's financial records to the Tribe, and
the Tribe began the process of obtaining control of MIB's bank accounts.
Tamiami immediately returned to the district court seeking an injunction to prevent the Tribe from
exercising self-help. In its third omnibus order, issued on April 15, the district court found that the Tribal
Court had exceeded its jurisdiction in ratifying the conservator's appointment. The court also concluded that
the Tribe had exceeded its sovereign powers in rejecting the license applications of Tamiami, TDC, Mandel,
and Sisto. In its view, these rejections were simply an attempt to circumvent the ongoing arbitration and to
terminate the Agreement. Accordingly, the court declared that all of the Tribe's April 13 actions were void
and ordered the parties to return to the status quo ante of April 12. The court certified its order under 28
U.S.C. § 1292(b) (1994) to allow the Tribe to appeal. We permitted the Tribe's appeal and consolidated it
with Tamiami's two pending interlocutory appeals.
On August 16, 1993, a panel of this court decided these three appeals. See Tamiami Partners, Ltd.
v. Miccosukee Tribe of Indians, 999 F.2d 503 (11th Cir.1993) [hereinafter Tamiami I ]. Addressing the subject
matter jurisdiction of the district court, the panel applied the "well-pleaded complaint rule"3 and held that
Tamiami's complaint failed to state a federal question within the meaning of 28 U.S.C. § 1331 (1994). See
Tamiami I, 999 F.2d at 506-07. The panel recognized that "[t]he right to be protected against an unlawful
3
Under the well-pleaded complaint rule, a case does not raise an issue of federal law "unless a
federal question is presented on the face of the plaintiff's complaint." Kemp v. International Bus. Machs.
Corp., 109 F.3d 708, 712 (11th Cir.1997).
exercise of tribal court judicial power is ... a claim arising under federal law," id. at 507, but stated that
Tamiami's complaint failed to assert such a right. Instead, the complaint merely invoked section 1331 and
then "present[ed] facts establishing a breach of contract claim." Id. Accordingly, the panel reversed the
district court's third omnibus order and remanded the case with the following instructions:
Because we are now aware of facts which suggest that the district court could have [subject matter]
jurisdiction if the case arose today, we remand the case to the district court with directions that the
district court dismiss this action unless one of the present parties files a complaint or other pleading
which properly alleges jurisdiction.
Id. at 508.
B.
On remand, Tamiami accepted the panel's invitation by filing an amended complaint on September
14, 1993. This complaint essentially presented three claims.4 First, Tamiami asserted a breach of contract
claim against the Tribe. It alleged that the Tribe, operating through its Business Council and Gaming Agency,
breached the Agreement by taking control of MIB and ousting Tamiami from the premises. Such actions,
according to Tamiami, violated IGRA and exceeded the sovereign powers accorded to the Tribe under federal
law. As a remedy for these violations, Tamiami sought an injunction restoring its position as the MIB
operator and requiring the Tribe to pay Tamiami its forty percent share of MIB's net revenues.
In its second claim, Tamiami contended that the Tribe, acting through its Gaming Agency, abused
the licensing authority conferred by IGRA and its associated regulations by refusing to license Tamiami,
TDC, Mandel, and Sisto. Tamiami therefore sought an order declaring that such abuses had occurred and
enjoining the Gaming Agency to issue the requested licenses. Tamiami's third claim, which also pertained
to the licensing authority conferred by IGRA and its regulations, was brought against individual members
of the Tribe's Business Council and Gaming Agency. According to Tamiami, because these individuals were
4
This court gleaned these three claims from a fair reading of the complaint. See Tamiami
Partners, Ltd. v. Miccosukee Tribe of Indians, 63 F.3d 1030, 1046-47 (11th Cir.1995). In addition to
these claims, Tamiami further contended that the Miccosukee Tribal Court and its judges had exceeded
their jurisdiction and sought to have the Tribal Court's actions of April 13, 1993, declared invalid.
Because this court later declared these claims against the Tribal Court and its judges to be moot, see id. at
1044, 1046 n. 57, we do not discuss them further here.
executing the Tribe's plan to assume control of MIB by refusing to license Tamiami's key personnel, they
were subject to suit under IGRA in the district court. As to these defendants, Tamiami sought an injunction
ordering them to grant the licenses at issue, restore Tamiami to the MIB premises, and turn over its share of
the net revenues.
Meanwhile, the arbitration between the parties was proceeding and the arbitration panel had
scheduled a final hearing for September 23. On September 15, the Tribe filed a motion in Tribal Court
requesting a stay of arbitration proceedings. The court granted the stay on the following day. On September
21, the arbitration panel concluded that it derived its authority from Article 12 of the Agreement and that the
Miccosukee Tribal Court had no jurisdiction to enforce that article. The panel therefore proceeded to hold
its final hearing as scheduled, albeit without the participation of the Tribe or its chosen arbitrator. On October
6, a majority of the panel issued a decision in which it found that the Tribe had violated the Agreement by
terminating Tamiami's MIB program director after denying his application for a gaming license. The panel
awarded Tamiami fees and costs, and gave the Tribe a choice between reinstating Tamiami as manager of
MIB or paying Tamiami $9.5 million in satisfaction of the Tribe's obligations under the Agreement.
On October 12, 1993, the Tribe again restructured the management of MIB by terminating the
conservator. At the Tribe's direction, the conservator withdrew Tamiami's share of net revenues from the trust
account at Jefferson National Bank; he received those funds in the form of a cashier's check for
approximately $1,566,000 that was made payable to "Dexter Lehtinen, trustee." Lehtinen, the Tribe's legal
counsel, then endorsed the check over to the Tribe for deposit in a separate account at Jefferson National
Bank entitled "Miccosukee Indian Bingo Reserve Account." The district court froze this separate account
on October 27.
Also on October 12, the defendants filed motions to dismiss Tamiami's amended complaint on the
grounds of lack of subject matter jurisdiction, sovereign immunity, and failure to state a claim. The district
court ruled on these motions on February 28, 1994. See Tamiami Partners, Ltd. v. Miccosukee Tribe of
Indians, 898 F.Supp. 1549 (S.D.Fla.1994). The court began by holding that Tamiami's amended complaint
raised a federal question—"namely, whether these defendants exceeded tribal powers in their actions towards
[Tamiami]." Id. at 1560. Turning to the issue of sovereign immunity, the court concluded that Tamiami's
claims against the Tribe and its Business Council and Gaming Agency were barred because the Tribe had not
clearly waived its immunity and Congress had not abrogated it. Accordingly, the court dismissed these
claims with prejudice. With regard to the individual defendants, however, the court—applying the doctrine
of Ex parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908)—held that the Tribe's sovereign
immunity did not shield the individual defendants given Tamiami's allegation that they had "acted beyond
the authority that the Tribe is capable of bestowing upon them under federal laws defining the sovereign
powers of Indian tribes." Id. at 1561-62. The court therefore denied the individual defendants' motions to
dismiss.
The individual defendants appealed the portion of the district court's order rejecting their claims of
tribal sovereign immunity. After the district court entered final judgment on Tamiami's claims against the
Tribe and its associated entities, Tamiami appealed that judgment. A second panel of this court consolidated
these appeals and issued an opinion on August 16, 1995. See Tamiami Partners, Ltd. v. Miccosukee Tribe
of Indians, 63 F.3d 1030 (11th Cir.1995) [hereinafter Tamiami II ].
As to the subject matter jurisdiction of the district court, the panel held that each of Tamiami's three
claims presented a federal question. Tamiami's claim that the Tribe had breached the Agreement, according
to the panel, was essentially a claim that the Tribe—acting through its Gaming Agency—had violated IGRA
and its associated regulations (which the Agreement incorporated) by failing to process Tamiami's license
applications in good faith with the sole purpose of taking over MIB. Thus, Tamiami's arguments that IGRA
imposed an obligation to process license applications in good faith and that the Tribe violated this obligation
presented a federal question. The panel also concluded that Tamiami's second and third claims, which were
based directly on IGRA and the regulations, presented federal questions. See id. at 1047.
Turning to the issues of sovereign immunity and failure to state a claim, the panel examined
Tamiami's first and second claims against the Tribe. It agreed with the district court's conclusion that
Tamiami's first claim was barred by the Tribe's sovereign immunity, which Congress had not abrogated and
the Tribe had not clearly waived. Although Article 23 of the Agreement did provide a waiver for the limited
purposes of compelling the Tribe to arbitrate or enforcing an arbitration award, the panel found that
Tamiami's first claim—"simply a breach of contract claim for which it seeks money damages and injunctive
relief," id. at 1048—did not seek the type of relief contemplated by that waiver. In footnote 66, which
appeared at the end of its discussion of Tamiami's first claim, the panel offered the following comment:
Tamiami's original complaint sought an order compelling the Tribe to submit to arbitration; its
amended complaint, however, does not seek that relief. Tamiami remains free, of course, to seek
enforcement in the district court of the October 6, 1993 arbitration award and to seek an order in the
district court compelling arbitration of any remaining contract disputes.
Id. at 1048 n. 66. As to Tamiami's second claim alleging violations of IGRA and the regulations, however,
the panel did not agree that it was barred by the Tribe's sovereign immunity. Rather, it "dispose[d] of that
claim on the separate ground that, because IGRA provides Tamiami no right of action, Tamiami has failed
to state a claim for relief." Id. at 1048.
Finally, the panel considered Tamiami's claim against the individual defendants. It found that the
district court's denial of the individual defendants' motions to dismiss on the ground of Tribal sovereign
immunity was immediately appealable under the Cohen collateral order doctrine. See id. at 1050; see also
Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541, 546-47, 69 S.Ct. 1221, 1225-26, 93 L.Ed. 1528 (1949).
The panel then proceeded to affirm the district court's ruling, under the doctrine of Ex parte Young, that the
individual defendants were not shielded by the Tribe's sovereign immunity. It declined to decide, however,
whether Tamiami could state a claim for relief against the individual defendants. See id. at 1051 & n. 72.
C.
On remand, the district court granted Tamiami's motion to file a second amended complaint—the
pleading now before us. This complaint, which Tamiami filed on November 17, 1995, contains six counts
and names as defendants the Tribe, individual members of the Tribe's Business Council and Gaming Agency
(Billy Cypress, Jasper Nelson, Jimmie Bert, Max Billie, and Henry Bert), and the Tribe's legal counsel,
Dexter Lehtinen. The first count essentially requests two types of declaratory relief: (a) a declaration that
all disputes between Tamiami and the Tribe that arise out of or relate to the Agreement—including the
licensing dispute—are arbitrable; and (b) a declaration against all of the defendants that the funds in the
frozen account belong solely to Tamiami. The second and third counts request a judgment requiring the Tribe
to comply with the October 1993 arbitration award and compelling the Tribe to arbitrate certain other disputes
arising out of or related to the Agreement.
In the fourth count, Tamiami seeks an injunction against the Tribe in the form of an order directing
the individual members of the Business Council and Gaming Agency to rescind their orders of April 13 and
October 12, 1993—which converted Tamiami's share of MIB's net revenues to the Tribe—and return the
funds in the frozen account to Tamiami. The fifth count is a conversion claim against Billy Cypress,
Chairman of the Tribe, and Dexter Lehtinen. In this count, Tamiami contends that Cypress and Lehtinen
caused to be converted to the Tribe certain sums rightfully belonging to Tamiami, including the $1.5 million
in the frozen Jefferson National Bank trust account and a $50,000 advance that was in the custody of the
conservator as of April 13, 1993. As a result of this conversion, Tamiami requests compensatory damages
"in excess of $1.5 million." The sixth count requests that the court order all defendants to make an accounting
to Tamiami for the funds taken from the frozen account and for MIB's revenues since October 1993. In
addition, Tamiami seeks a judgment imposing a constructive trust over its forty percent share of MIB's net
revenues, the funds in the frozen account, and the $50,000 advance, as well as an order requiring the
defendants immediately to pay these sums to Tamiami.
On December 4 and 5, all of the defendants filed motions to dismiss Tamiami's second amended
complaint on the following three grounds: lack of subject matter jurisdiction, sovereign immunity, and failure
to state a claim.5 The district court denied these motions in a memorandum opinion and order dated
September 27, 1996. In its brief opinion, the court found that the first three counts of Tamiami's complaint
5
Certain defendants included a fourth ground for dismissal, namely that Tamiami had waived its
contractual right to arbitration under the Agreement. This waiver argument, however, is an affirmative
defense, see Fed.R.Civ.P. 8(c); it is not a ground upon which Tamiami's complaint could be dismissed.
Therefore, we do not consider the issue of waiver here.
were predicated on the arbitration clause of the Agreement. Referring to the Tamiami II panel's comments
in footnote 66, it concluded that the Eleventh Circuit had contemplated the assertion of such arbitration claims
on remand. The court therefore rejected the defendants' arguments as to those claims. Turning to counts four
through six, the court found that it had supplemental jurisdiction to consider the state law claims asserted
therein. The court also rejected "the individual defendants' invocation of sovereign immunity as to the claims
asserted against them, pursuant to its prior analysis under the doctrine of Ex parte Young, which was affirmed
by the Eleventh Circuit." This appeal followed.
II.
The defendants urge us to find that the district court erred in rejecting each of the three grounds upon
which they based their motions to dismiss. Because this is an interlocutory appeal from the district court's
denial of the defendants' motions, however, we must exercise care in determining which of these three issues
are presently before us for review.
We have no doubt that the issue of subject matter jurisdiction is before us. As a threshold matter,
we have a special obligation to satisfy ourselves not only that we have jurisdiction over this appeal, but also
that the district court had jurisdiction over the various counts of Tamiami's complaint. See Steel Co. v.
Citizens for a Better Env't, 523 U.S. 83, ----, 118 S.Ct. 1003, 1012-13, 140 L.Ed.2d 210 (1998).6 "[When the
lower federal court] lack[s] jurisdiction, we have jurisdiction on appeal, not of the merits but merely for the
purpose of correcting the error of the lower court in entertaining the suit." Bender v. Williamsport Area Sch.
Dist., 475 U.S. 534, 541, 106 S.Ct. 1326, 1331, 89 L.Ed.2d 501 (1986) (alterations in original) (quoting
United States v. Corrick, 298 U.S. 435, 440, 56 S.Ct. 829, 832, 80 L.Ed. 1263 (1936)). Thus, it is appropriate
for us initially to consider whether the district court erred in finding that it had subject matter jurisdiction over
Tamiami's complaint. Cf. In re Sealed Case, 131 F.3d 208, 210-12 (D.C.Cir.1997) (considering issue of
6
This obligation applies to every appeal; it is "inflexible and without exception." Id. at ----, 118
S.Ct. at 1012 (quoting Mansfield, C. & L.M. Ry. Co. v. Swan, 111 U.S. 379, 382, 4 S.Ct. 510, 511, 28
L.Ed. 462 (1884)).
subject matter jurisdiction before addressing issue that qualified for interlocutory appeal under collateral order
doctrine).
The issue of sovereign immunity is also properly before us. Under 28 U.S.C. § 1291 (1994), we
have "jurisdiction of appeals from all final decisions of the district courts ..., except where a direct review may
be had in the Supreme Court." The Cohen collateral order doctrine gives a "practical construction" to this
final decision rule by permitting appeals "from a small category of decisions that, although they do not end
the litigation, must nonetheless be considered 'final.' " Swint v. Chambers County Comm'n, 514 U.S. 35, 42,
115 S.Ct. 1203, 1208, 131 L.Ed.2d 60 (1995) (quoting Cohen v. Beneficial Indus. Loan Corp., 337 U.S. 541,
546, 69 S.Ct. 1221, 1225-26, 93 L.Ed. 1528 (1949)). This small category of immediately appealable
decisions "includes only decisions that are conclusive, that resolve important questions separate from the
merits, and that are effectively unreviewable on appeal from the final judgment in the underlying action."
Id. As the panel recognized in Tamiami II, 63 F.3d at 1050, the district court's denial of sovereign immunity
to the defendants falls within this category.
Regarding the issue of whether Tamiami has failed to state a claim, the defendants ask us to exercise
pendent appellate jurisdiction on the theory that this issue is "inextricably intertwined" with the issue of
sovereign immunity.7 In accordance with the Supreme Court's suggestion in Swint, 514 U.S. at 51, 115 S.Ct.
at 1212, we have previously recognized that pendent appellate jurisdiction over related claims "may be
appropriate when a nonappealable decision is 'inextricably intertwined' with an appealable decision or when
'review of the former decision [is] necessary to ensure meaningful review of the latter.' " United States v.
Lopez-Lukis, 102 F.3d 1164, 1167 n. 10 (11th Cir.1997) (exercising such jurisdiction). In this case, however,
a brief overview of the defendants' specific contentions suffices to demonstrate that the issue of whether
Tamiami has failed to state a claim is not in fact inextricably intertwined with the issue of sovereign
7
The defendants do not—and could not—rely upon either Cohen or 28 U.S.C. § 1292 (1994) as
a basis for their contention that we have jurisdiction to consider the issue of whether Tamiami has failed
to state a claim.
immunity.8 The defendants argue that Tamiami has failed to state a claim because counts one through three
of its complaint rely on certain provisions of IGRA that do not apply to the Agreement and provide no cause
of action, and because counts four through six are duplicative prayers for relief that state no claim under either
federal or state law. Plainly, these arguments are wholly unrelated to the defendants' contentions that
Tamiami's claims against the Tribe do not fall within the Tribe's waiver of sovereign immunity and that the
individual defendants are not amenable to suit under the doctrine of Ex parte Young. Therefore, we decline
to exercise pendent appellate jurisdiction over the issue of failure to state a claim; we consider only whether
the district court had subject matter jurisdiction and whether the Tribe and the individual defendants were
shielded by sovereign immunity.
III.
A.
The issue of whether the district court had subject matter jurisdiction over Tamiami's complaint is
a question of law subject to de novo review. See Tamiami I, 999 F.2d at 506. We begin our review with the
defendants' contention that the first three counts of Tamiami's complaint do not state a federal question. See
28 U.S.C. § 1331 (1994). According to the defendants, these counts merely address contract and arbitration
disputes arising under the Agreement. They argue that such disputes do not raise a federal question and that
the statement in Article 23 of the Agreement that the district court "shall have jurisdiction" over the parties
cannot change this result.
The defendants are correct in part. It is well-settled that parties cannot create subject matter
jurisdiction by agreement. See Love v. Turlington, 733 F.2d 1562, 1564 (11th Cir.1984). In addition, the
mere fact that a dispute concerns a contract or an agreement to arbitrate, without more, does not raise a federal
question. See Tamiami I, 999 F.2d at 507 (holding that the presentation of facts establishing a breach of
8
We are aware of, and unimpressed by, the defendants' assertion that the Tamiami II panel has
inextricably intertwined these issues. According to the defendants, the panel did so by deciding that the
individual defendants were amenable to suit under Ex parte Young and then refusing to reach the issue of
whether Tamiami could state a claim against them. See Tamiami II, 63 F.3d at 1051 n. 72. If anything,
this discussion indicates that the panel did not view these issues as inextricably intertwined.
contract claim does not state a federal question); Merrill Lynch, Pierce, Fenner & Smith, Inc. v. Haydu, 637
F.2d 391, 395 (5th Cir. Unit B Feb.1981)9 (noting that the Federal Arbitration Act alone is insufficient to
confer federal jurisdiction over disputes involving arbitration agreements, and that an independent basis of
jurisdiction—such as diversity or a federal question—is required). In this case, however, we find that the first
three counts of Tamiami's complaint present more than a mere dispute concerning a contract or an agreement
to arbitrate. Each of these counts—at least in part—concerns the arbitration of Tamiami's claims that the
Tribe had an obligation under the Agreement to process the gaming license applications of Tamiami and its
key employees in good faith, and that the Tribe breached its obligation when it rejected these license
applications for the sole purpose of taking over MIB.10 These very same claims were before this court in
Tamiami II, albeit in the context of a direct breach of contract suit against the Tribe. The Tamiami II panel
concluded that these claims arose under federal law because the Agreement incorporated—by operation of
law if not by reference—the provisions of IGRA and its associated regulations regarding licensing
procedures. See Tamiami II, 63 F.3d at 1047. Because federal law is equally implicated when these claims
are presented in the arbitration context,11 we must follow the Tamiami II panel's conclusion here.12 We hold,
9
In Bonner v. City of Prichard, 661 F.2d 1206, 1209 (11th Cir.1981) (en banc), this court
adopted as binding precedent all decisions of the former Fifth Circuit handed down prior to October 1,
1981.
10
Specifically, one portion of the first count requests a declaration "that disputes between the
parties to the Agreement regarding the licensing of [Tamiami] and its principals [are] arbitrable." The
second count requests enforcement of the October 1993 arbitration award, which addressed the
termination of Tamiami's MIB program director following the denial of his gaming license application by
the Tribe. The third count seeks to compel the Tribe to arbitrate certain additional disputes, including
Tamiami's claims "that the Tribe breached the Agreement by failing to process the applications of
[Tamiami's] managers and key employees in good faith; [and] that the Tribe ... abused its licensing
authority and rejected [Tamiami] applications for the sole purpose of taking over MIB."
11
The Federal Arbitration Act empowers a district court to issue an order compelling arbitration
if the court, "save for [the arbitration] agreement, would have jurisdiction under title 28, in a civil action
... of the subject matter of a suit arising out of the controversy between the parties." 9 U.S.C. § 4 (1994).
Thus, it is appropriate for us to "look through" Tamiami's arbitration request at the underlying licensing
dispute in order to determine whether Tamiami's complaint states a federal question.
12
Rather than looking to Tamiami II, the defendants assert that Tamiami's current (second
amended) complaint asks for the same relief that was held not to provide a basis for federal question
therefore, that the first three counts of Tamiami's complaint state a federal question insofar as they relate to
the Tribe's rejection of gaming license applications. The portions of these counts that do not relate to gaming
licenses are plainly within the supplemental jurisdiction of the district court; the defendants do not contend
otherwise.
The defendants do contend, however, that the district court lacked the power to exercise
supplemental jurisdiction over counts four through six of Tamiami's complaint. Under 28 U.S.C. § 1367(a)
(1994), a district court that has original jurisdiction in a civil action "shall have supplemental jurisdiction over
all other claims that are so related to claims in the action within such original jurisdiction that they form part
of the same case or controversy under Article III of the United States Constitution." In other words, a district
court has the power to exercise supplemental jurisdiction over all claims that "arise out of a common nucleus
of operative fact with a substantial federal claim." Lucero v. Trosch, 121 F.3d 591, 597 (11th Cir.1997).
We readily conclude that Tamiami's federal claims regarding the Tribe's gaming license denials are
sufficiently substantial to support supplemental jurisdiction. Neither we nor the defendants have discovered
any "prior decisions [that] inescapably render the claims frivolous." See L.A. Draper & Son v. Wheelabrator-
Frye, Inc., 735 F.2d 414, 427 (11th Cir.1984) (quoting Jackson v. Stinchcomb, 635 F.2d 462, 471 (5th Cir.
Jan.1981)). As to whether these substantial federal claims share a common nucleus of operative fact with
Tamiami's claims in counts four through six, the defendants offer two reasons why they do not. First, the
Tribe and its officials argue that no common nucleus exists because Tamiami's federal claims are against the
jurisdiction in Tamiami I. This assertion is simply incorrect. The original verified complaint that was
before the Tamiami I panel sought, inter alia, an injunction compelling the Tribe to arbitrate the dispute
arising from its initial attempt to terminate the Agreement by letter. Because the subsequent licensing
dispute between the parties had not yet arisen when the verified complaint was filed, that complaint
understandably made no allegations and requested no relief regarding the licensing dispute. It is this
licensing dispute—not the earlier termination dispute—that provides a basis for exercising federal
question jurisdiction over Tamiami's current complaint.
We are aware that Tamiami's "supplemental" complaint, which the district court declined
to entertain on September 15, 1992, included allegations regarding the Tribe's initial license
denials and requested an order compelling the Tribe to arbitrate the licensing dispute. The
Tamiami I panel, however, had no jurisdiction to consider this version of Tamiami's complaint.
See Tamiami II, 63 F.3d at 1043 n. 44.
Tribe while its remaining claims are against the individual defendants. This argument is both factually and
legally incorrect. As a factual matter, our discussion of Tamiami's second amended complaint reveals that
counts four and six are against both the Tribe and the individual defendants. See supra part I.C. In addition,
it is clear from section 1367 itself that the parties to the federal and supplemental claims need not be identical
in order for supplemental jurisdiction to lie. See 28 U.S.C. § 1367(a) ("Such supplemental jurisdiction shall
include claims that involve the joinder or intervention of additional parties.").
Second, defendant Lehtinen argues that a common nucleus is lacking as to counts five and six
because the facts that bear upon the state-law claims asserted in those counts are separate and distinct from
the facts that are relevant to the resolution of Tamiami's federal claims. Specifically, Lehtinen asserts that
the facts necessary to prove conversion and constructive trust under state law concern the actions of the
individual defendants regarding certain funds (such as those in the frozen account), while the facts necessary
to the resolution of Tamiami's federal claims concern the arbitration provisions of the Agreement between
Tamiami and the Tribe. Because the success of Tamiami's federal claims does not depend on the success of
its state-law claims, he argues, supplemental jurisdiction over the state-law claims is unavailable. We find
Lehtinen's conception of supplemental jurisdiction to be unduly narrow. In our view, both Tamiami's federal
claims and its claims in counts four through six seek to remedy the injury that Tamiami suffered when the
Tribe terminated the Agreement through a series of actions by the individual defendants. In its second
amended complaint, Tamiami made a strategic decision to attack this termination in two ways: (1) in the first
three counts, Tamiami attacked the Tribe's method of terminating the agreement by seeking to arbitrate its
federal claim that the Tribe denied its license applications in bad faith in order to take over MIB; and (2) in
counts four through six, Tamiami attacked the result of this termination by seeking to recover its forty percent
share of MIB's net revenues from the Tribe and the individual defendants. This strategic decision, however,
did not catalyze some mysterious fissile process that split the sphere of operative facts surrounding the
termination dispute into two separate nuclei. Thus, the district court had the power to exercise supplemental
jurisdiction over counts four through six of Tamiami's complaint.
B.
We now turn to the district court's ruling that the Tribe's sovereign immunity does not shield the
Tribe and the individual defendants from suit. The issue of a sovereign's immunity from suit is a question
of law that we review de novo. See Tinney v. Shores, 77 F.3d 378, 383 (11th Cir.1996).
"Indian tribes have long been recognized as possessing the common-law immunity from suit
traditionally enjoyed by sovereign powers." Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58, 98 S.Ct. 1670,
1677, 56 L.Ed.2d 106 (1978). Tamiami's claims against the Tribe itself are therefore "barred by the doctrine
of sovereign immunity unless the Tribe, by the very act of entering into the [Agreement] and engaging in the
gaming enterprise, waived its immunity from suit by Tamiami or Congress, by enacting IGRA, abrogated that
immunity." Tamiami II, 63 F.3d at 1048. Although we concluded in Tamiami II that IGRA did not purport
to abrogate the sovereign immunity of tribes that engage in bingo gaming, we also found that the Tribe
partially waived its immunity in Article 23 of the Agreement. See id. The Tribe contends that Tamiami's
claims against it in the second amended complaint do not fall within the scope of this waiver.
Under Article 23 of the Agreement, the Tribe waived its immunity from a suit brought by Tamiami
to compel arbitration or to enforce an arbitration award. See supra part I.A. (quoting Article 23). To the
extent that counts one (b), four, and six of the second amended complaint—which seek, respectively, a
declaration that the frozen funds belong to Tamiami, an injunction compelling the return of these funds, and
an accounting and the imposition of a constructive trust—are directed against the Tribe,13 we agree that these
counts do not fall within the scope of the Article 23 waiver. These counts are therefore barred and the district
court erred in refusing to dismiss them as to the Tribe. Counts one (a), two, and three of the complaint,
however, seek only a declaration that the disputes between Tamiami and the Tribe that arise out of or relate
to the Agreement are arbitrable, a judgment requiring the Tribe to comply with the October 1993 arbitration
award, and a judgment compelling the Tribe to arbitrate certain disputes arising out of or relating to the
13
Count five of the complaint is not directed against the Tribe; it seeks only to hold Cypress
and Lehtinen individually liable for conversion.
Agreement. Plainly, these counts seek the type of relief expressly contemplated by Article 23.14 Thus, the
district court correctly refused to dismiss these counts on the ground of sovereign immunity.
Turning to the individual defendants' claims of immunity as tribal officers,15 we begin with the
proposition that tribal officers are protected by tribal sovereign immunity when they act in their official
capacity and within the scope of their authority; however, they are subject to suit under the doctrine of Ex
parte Young when they act beyond their authority.16 In Tamiami II, 63 F.3d at 1050-51, we relied on Ex parte
Young in affirming the district court's ruling that the Tribe's sovereign immunity did not shield the individual
defendants from Tamiami's suit. Our holding pertained to the third count of Tamiami's amended complaint,
which was brought under IGRA and its regulations. This count essentially alleged that the individual
defendants, by abusing the licensing authority conferred by IGRA, had acted beyond the authority that the
Tribe was capable of bestowing upon them. Tamiami's claims against the individual defendants in its present
(second amended) complaint, however, do not mention IGRA or licensing at all. Instead, in counts one (b)
and four through six, Tamiami merely offers various theories under which the individual defendants must pay
14
We read count one (a) as requesting only that the district court, prior to ordering the Tribe to
arbitrate a given dispute as requested in count three, determine that Tamiami has properly invoked an
arbitration proceeding as to that dispute under Article 12 of the Agreement. So read, we find that count
one (a) clearly falls within the portion of the Article 23 waiver that permits the district court to "enforce
the terms [of the Agreement] specifically, [in the event that the Tribe] fails to participate in an arbitration
proceeding invoked as provided in Article 12."
15
Each of the individual defendants claims tribal officer status; Tamiami does not dispute this
claim. We therefore assume, without deciding, that all of the individual defendants—including attorney
Lehtinen—were officers of the Tribe who undertook the complained-of actions in their official capacities.
Cf. Stock West Corp. v. Taylor, 942 F.2d 655, 664-65 (9th Cir.1991), modified on reh'g, 964 F.2d 912
(9th Cir.1992) (en banc) (citing cases and discussing issue of when tribal attorney is acting as tribal
official).
16
See Fletcher v. United States, 116 F.3d 1315, 1324 (10th Cir.1997); Tamiami II, 63 F.3d at
1050-51; Northern States Power Co. v. Prairie Island Mdewakanton Sioux Indian Community, 991 F.2d
458, 460 (8th Cir.1993); Imperial Granite Co. v. Pala Band of Mission Indians, 940 F.2d 1269, 1271
(9th Cir.1991); Tenneco Oil Co. v. Sac & Fox Tribe of Indians, 725 F.2d 572, 574-75 (10th Cir.1984);
Thompson v. Crow Tribe of Indians, 962 P.2d 577, 581-82 (Mont.1998); cf. Santa Clara Pueblo v.
Martinez, 436 U.S. 49, 59, 98 S.Ct. 1670, 1677, 56 L.Ed.2d 106 (1978) (citing Ex parte Young and
finding that a tribal officer was not protected by tribal sovereign immunity from a suit to enjoin
enforcement of a tribal ordinance that allegedly violated a federal statute).
it forty percent of MIB's net revenues. In our view, these claims against the individual defendants are simply
a thinly-disguised attempt by Tamiami to obtain specific performance of the Tribe's obligations under the
Agreement, which allocates forty percent of MIB's net revenues to Tamiami. The doctrine of Ex parte Young
may not be used in this fashion. It is well established that Ex parte Young does not permit individual officers
of a sovereign to be sued when the relief requested would, in effect, require the sovereign's specific
performance of a contract. See, e.g., Ex parte Young, 209 U.S. 123, 151, 28 S.Ct. 441, 450, 52 L.Ed. 714
(1908) (citing Ex parte Ayers, 123 U.S. 443, 504, 8 S.Ct. 164, 182, 31 L.Ed. 216 (1887); Hagood v.
Southern, 117 U.S. 52, 67-68, 6 S.Ct. 608, 615, 29 L.Ed. 805 (1886)); MSA Realty Corp. v. Illinois, 990 F.2d
288, 294-95 (7th Cir.1993). We hold, therefore, that the district court erred in rejecting the individual
defendants' claims of sovereign immunity under the doctrine of Ex parte Young.
IV.
For the foregoing reasons, the defendants' request that we exercise pendent appellate jurisdiction over
the issue of whether Tamiami's second amended complaint fails to state a claim is DENIED. On the issue
of subject matter jurisdiction, the district court's denial of the defendants' motions to dismiss is AFFIRMED.
On the issue of sovereign immunity, the district court's denial of the Tribe's motion to dismiss is AFFIRMED
as to counts one (a), two, and three, and REVERSED as to counts one (b), four, and six. The district court's
denial of the individual defendants' motions to dismiss on the ground of sovereign immunity is REVERSED.
We REMAND this case to the district court for further proceedings consistent with this opinion.
IT IS SO ORDERED.
Tamiami Partners, Ltd. Ex Rel. Tamiami Development Corp. v. Miccosukee Tribe of Indians
Court: Court of Appeals for the Eleventh Circuit
Date filed: 1999-06-07
Citations: 177 F.3d 1212
Copy CitationsCombined Opinion