Litigation

U.S. Supreme Court limits tribal court jurisdicition

By Rob Roy Smith

The U.S. Supreme Court yesterday issued an important 5-4 decision addressing the scope of tribal court jurisdiction.  At issue in Plains Commerce Bank v. Long Family Land and Title Co. was whether a tribal court could exercise jurisdiction over a non-Indian-owned bank for discrimination claims arising from the foreclosure and subsequent sale of fee land on a tribal reservation by the bank to non-Indian individuals. 

Writing for the majority, Chief Justice Roberts, in his first Indian law opinion, concluded that Indian tribes cannot "regulate the sale of non-Indian fee land."  The Court construed its prior cases on the subject narrowly as allowing only "tribal regulation of nonmember conduct inside the reservation that implicates the tribe's sovereign interests."  The Court also held that the non-Indian bank's mere conduct of business on the reservation did not mean that it had consented to either broad tribal regulation of its lending practices and land sales, or to the tribal court's jurisdiction.

The Court's opinion has narrowed the scope of tribal jurisdiction and appears to have insulated non-Indian businesses operating on non-Indian land within a reservation from certain real property and tort claims.  Before entering into any business dealings on reservation lands, it is in both an Indian tribe's and a business's best interests to understand the scope of tribal regulations affecting a commercial project, and to carefully draft the relevant transaction documents to address tribal court jurisdiction.

See our earlier post about the Plains Commerce Bank case here.

Full post as published by Northwest Business Litigation Blog on June 26, 2008 (boomark / email).