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The Cherokee Nation v. Bernhardt

United States Court of Appeals, Tenth Circuit

September 5, 2019

THE CHEROKEE NATION, Plaintiff - Appellee,
v.
DAVID BERNHARDT, in his official capacity as Secretary of the Interior, U.S. Department of the Interior; TARA KATUK MAC LEAN SWEENEY, in her official capacity as Acting Assistant Secretary for Indian Affairs, U.S. Department of the Interior; EDDIE STREATER, in his official capacity as Eastern Oklahoma Regional Director, Bureau of Indian Affairs, Defendants, and UNITED KEETOOWAH BAND OF CHEROKEE INDIANS IN OKLAHOMA; UNITED KEETOOWAH BAND OF CHEROKEEE INDIANS IN OKLAHOMA CORPORATION, Intervenors Defendants -Appellants. THE CHEROKEE NATION, Plaintiff - Appellee,
v.
DAVID BERNHARDT, in his official capacity as Secretary of the Interior, U.S. Department of the Interior; TARA KATUK MAC LEAN SWEENEY, in her official capacity as Acting Assistant Secretary for Indian Affairs, U.S. Department of the Interior; EDDIE STREATER, in his official capacity as Eastern Oklahoma Regional Director, Bureau of Indian Affairs, Defendants - Appellants, and UNITED KEETOOWAH BAND OF CHEROKEE INDIANS IN OKLAHOMA; UNITED KEETOOWAH BAND OF CHEROKEEE INDIANS IN OKLAHOMA CORPORATION, Intervenors Defendants.

          Appeal from the United States District Court for the Eastern District of Oklahoma (D.C. No. 6:14-CV-00428-RAW)

          Avi Kupfer, Attorney, Environment and Natural Resources Division, U.S. Department of Justice, Washington, D.C. (Jeffrey H. Wood, Acting Assistant Attorney General, Eric Grant, Deputy Assistant Attorney General, William B. Lazarus, Thekla Hansen-Young, and Jody H. Schwarz, Attorneys, Environment and Natural Resources Division, U.S. Department of Justice, Washington, D.C.; Scott Keep, Matthew Kelly, Office of the Solicitor, U.S. Department of the Interior, Washington, D.C. with him on the briefs), for Federal Appellants.

          Klint A. Cowan of Fellers, Snider, Blankenship, Bailey & Tippens, P.C., Oklahoma City, Oklahoma, for Intervenors-Defendants-Appellants.

          David McCullough (S. Douglas Dodd with him on the brief), of Doerner, Saunders, Daniel & Anderson, L.L.P., Tulsa, Oklahoma, for Plaintiffs-Appellees.

          Before MATHESON, MCHUGH, and EID, Circuit Judges.

          EID, CIRCUIT JUDGE.

         Intervenor-Appellant the United Keetoowah Band of Cherokee Indians in Oklahoma (UKB) is a federally recognized Indian tribe located in eastern Oklahoma. The UKB are descended from the historical Cherokee Indian tribe. In 2000, the UKB purchased an undeveloped 76-acre parcel of land near Tahlequah, Oklahoma, with the intention of developing it into a tribal and cultural center (Subject Tract, or Subject Parcel). The Subject Parcel sits entirely within the boundaries of the former reservation of Appellees the Cherokee Nation of Oklahoma (Nation). In 2004, the UKB submitted an application to the Department of the Interior's Bureau of Indian Affairs (BIA), requesting the BIA take the Subject Parcel into trust, thereby formally establishing a UKB tribal land base. The Nation opposed the application. After seven years of review, the BIA approved the UKB's application.

         The Nation sued Department of the Interior and BIA officials, with the UKB intervening as defendants, challenging the BIA's decision on several fronts. The district court found in favor of the Nation, determining that the BIA's decision to take the Subject Parcel into trust was "arbitrary and capricious, an abuse of discretion, and otherwise not in accordance with law." Op. at 19. Among other holdings, the district court concluded that: (1) the BIA must obtain Nation consent before taking the Subject Parcel into trust; (2) the BIA's analysis of two of its regulations as applied to the UKB application was arbitrary and capricious; and (3) the BIA must consider whether the UKB meets the Indian Reorganization Act (IRA)'s definition of "Indian" in light of the Supreme Court case Carcieri v. Salazar, 555 U.S. 379 (2009). Op. at 19. Accordingly, the district court enjoined the Secretary of the Interior from accepting the Subject Parcel into trust.

         Because the district court's order was a final decision, we have jurisdiction over this appeal, pursuant to 28 U.S.C. § 1291. We hold that the Secretary of the Interior has authority to take the Subject Parcel into trust under section 3 of the Oklahoma Indian Welfare Act of 1936 (OIWA), 25 U.S.C. § 5203.[1] The BIA was therefore not required to consider whether the UKB meets the IRA's definition of "Indian." Nor was the BIA required to obtain the Nation's consent before taking the land into trust. We also hold that the BIA's application of its regulations was not arbitrary and capricious. Accordingly, we reverse the district court and vacate the injunction preventing the Secretary from taking the Subject Parcel into trust.

         I.

         A.

         The subject of this litigation is the UKB's 2004 application to the BIA, Eastern Oklahoma Region (Region) to acquire the Subject Tract into trust.[2] The application's road to eventual acceptance featured many twists and turns, which we outline here. First, the Region denied the application in April 2006. Aplt. App. 159. The UKB appealed that decision to the Interior Board of Indian Appeals (IBIA). On April 5, 2008 the Assistant Secretary for Indian Affairs (Assistant Secretary) directed the Region to request a remand from the IBIA to reconsider the application in light of findings made by the Assistant Secretary (2008 Directive). Aplt. App. 171. The Region requested the remand and the IBIA complied, vacating the Region's 2006 denial of the application.

         After reconsideration, the Region denied the application a second time on August 6, 2008. Aplt. App. 310. Again, the UKB appealed the decision to the IBIA. At this juncture, the Assistant Secretary assumed jurisdiction over the appeal pursuant to 25 C.F.R. § 2.20(c). The Assistant Secretary issued three decisions, dated June 24, 2009 (June 2009 Decision), July 30, 2009 (July 2009 Decision), and September 10, 2010 (2010 Decision), explaining why he found the Region's reasoning to be flawed. Aplt. App. 214, 229, and 270. The effect of the three decisions was to vacate the Region's denial of the application and remand to the Region for reconsideration consistent with the Assistant Secretary's findings.

         In the 2010 Decision, the Assistant Secretary determined that the UKB should be allowed to amend its application to invoke alternative authority for the acquisition of the Subject Parcel into trust. Aplt. App. 272. Accordingly, the UKB amended its application to request that the Subject Parcel be taken into trust: (1) for the UKB Corporation, rather than the UKB tribe; and (2) pursuant to section 3 of OIWA, 25 U.S.C. § 5203, rather than section 5 of the IRA, 25 U.S.C. § 5108.[3] Aplt. App. 291. The Assistant Secretary sent a letter dated January 21, 2011 to the UKB clarifying additional matters pertaining to the application (2011 Letter). Aplt. App. 289.

         B.

         On May 21, 2011, the Region issued its decision granting the UKB's amended application (2011 Decision). Aplt. App. 291. The 2011 Decision incorporated by reference the Assistant Secretary's 2008 Directive, June 2009 Decision, July 2009 Decision, 2010 Decision, and 2011 Letter. Aplt. App. 292. The BIA's relevant findings were as follows.[4]

         The BIA found that statutory and regulatory authority permitted the Secretary to take land into trust for the UKB. 25 C.F.R. § 151.3(a) permits the Secretary to take land into trust if the application satisfies one of three listed criteria.[5] The BIA determined that section 151.3(a)(2) applied because the UKB owned the Subject Tract in fee; and section 151.3(a)(3) applied because the Assistant Secretary found that the UKB had a need for the Subject Tract to be taken into trust so that the UKB may exercise jurisdiction over it, thus facilitating tribal self-determination. Aplt. App. 292. Additionally, the BIA found that "Section 3 of the OIWA . . . implicitly authorizes the Secretary to take land into trust for the UKB Corporation." Id. The BIA found this implicit authority in the following language of OIWA: "Such charter [of incorporation] may convey to the incorporated group, in addition to any powers which may properly be vested in a body corporate under the laws of the State of Oklahoma, the right . . . to enjoy any other rights or privileges secured to an organized Indian tribe under the [IRA]." 25 U.S.C. § 5203 (emphasis added). Because section 5 of the IRA authorizes the Secretary of the Interior to take land into trust "for the purpose of providing land for Indians," 25 U.S.C. § 5108, OIWA's reference to the IRA implicitly grants the Secretary authority to take land into trust for incorporated Oklahoma tribal groups (like the UKB).

         Next, the BIA determined that consultation with, rather than the consent of, the Nation is required before the Secretary may take land into trust for the UKB Corporation. BIA regulations stipulate that an Indian tribe "may acquire land in trust status on a reservation other than its own only when the governing body of the tribe having jurisdiction over such reservation consents in writing to the acquisition . . . ." 25 C.F.R. § 151.8 (emphasis added). It is undisputed that the Subject Tract is entirely within the former reservation of the Nation. But the BIA concluded that Congress overrode the consent requirement of section 151.8 with respect to lands within the boundaries of the former Cherokee reservation when it passed the Interior and Related Agencies Appropriations Act of 1999[6] (1999 Appropriations Act). The 1999 Appropriations Act provides: "until such time as legislation is enacted to the contrary, no funds shall be used to take land into trust within the boundaries of the original Cherokee territory in Oklahoma without consultation with the Cherokee Nation." 112 Stat. 2681-246 (emphasis added). The BIA determined that the 1999 Appropriations Act replaced the consent requirement with a consultation requirement in these circumstances, and the consultation requirement was satisfied when it solicited comments from the Nation in 2005 in connection with the UKB's initial application. Aplt. App. 293.

         The BIA next evaluated whether the application satisfied the criteria established by 25 C.F.R. § 151.10.[7] At issue in this appeal are the BIA's findings regarding subsections (f) and (g). Subsection (f) concerns whether jurisdictional problems may arise if the application were granted. The Region concluded that "it is clear that both the UKB and the [Nation] would assert jurisdiction over the subject property if it were taken in trust." Aplt. App. at 297. The Region noted that it had "twice previously concluded that the potential for jurisdictional problems between the Cherokee Nation and the UKB is of utmost concern and weighed heavily against approval of the acquisition." Id. In contrast, the Assistant Secretary had determined that: (1) the Nation did not have exclusive jurisdiction over the Subject Tract; (2) the UKB had a right to assert jurisdiction over its tribal lands; and (3) that "the perceived jurisdictional conflicts between the UKB and the [Nation] are not so significant that I should deny the UKB's application." Id. at 297-98. The Region remained concerned, but acknowledged that the Assistant Secretary's decisions were binding. Id. at 298.

         Subsection (g) concerns whether the BIA is equipped to discharge additional responsibilities resulting from a land-into-trust acquisition. The Region noted that the Nation currently administers programs for the Subject Parcel, such as real estate, tribal court, and law enforcement services. Id. The Region was concerned that if the Subject Tract were placed into trust for the UKB, the UKB would likely reject the authority of the Nation and insist that the Region provide direct services. Id. Despite the Region's worries that it did not have the funds necessary to provide those services, the Assistant Secretary "rejected this concern as unsubstantiated and insignificant." Id. Again, the Assistant Secretary's findings were binding on the Region.

         Accordingly, the BIA approved the UKB's land-into-trust application. Id. at 300. The Nation appealed the 2011 Decision to the IBIA, which dismissed the appeal for lack of jurisdiction and on the grounds of abstention. Cherokee Nation v. Acting E. Okla. Reg'l Dir., 58 IBIA 153, 2014 WL 264820 (2014).

         C.

         The Nation sued the BIA in federal district court challenging the 2011 Decision. The UKB and the UKB Corporation intervened as defendants. The Nation argued that the BIA could not acquire the Subject Parcel under section 3 of OIWA and, even if it could, the IRA's definition of the term "Indian" excludes the UKB. The Nation also contended that the BIA failed to comply with the regulatory requirement that it obtain Nation consent for the land-into-trust acquisition. And the Nation argued that the BIA's analysis of the 25 C.F.R. § 151.10 regulatory criteria-specifically the administrative-burden and jurisdictional-conflicts criteria-was arbitrary and capricious. The Nation asked for injunctive and declaratory relief.

         In 2017, the district court entered a decision enjoining the BIA from acquiring the Subject Tract. The court determined that the BIA may generally acquire the Subject Parcel under Section 3 of OIWA, but the BIA must consider how the Supreme Court's decision in Carcieri affects the BIA's right to acquire the parcel for the UKB in particular. Op. at 12, 14. In Carcieri, the Supreme Court held that the phrase "now under Federal jurisdiction" in the IRA's definition of "Indian" refers to "a tribe that was under federal jurisdiction at the time of the statute's enactment." 555 U.S. at 382. The Court reasoned that this definition "limits the Secretary's authority to taking land into trust for the purpose of providing land to members of a tribe that was under federal jurisdiction when the IRA was enacted in June 1934." Id. The UKB achieved federal recognition in 1946. See Act of August 10, 1946, ch. 947, 60 Stat. 976. The Assistant Secretary believed that Carcieri was not implicated in the 2011 Decision because the UKB amended its application to request land-into-trust pursuant to OIWA, not the IRA. Aplt. App. at 272. The district court disagreed that Carcieri was not implicated and held that before the BIA could take any land into trust for the UKB, the BIA must consider the IRA's definition of "Indian" in light of Carcieri. Op. at 19.

         The district court also held that the Nation must consent to the acquisition for two reasons: (1) an 1866 treaty between the United States and the Nation guarantees protection for the Nation against "domestic feuds and insurrections" and "hostilities of other tribes, "[8] which could describe the current dispute with the UKB; and (2) the 1999 Appropriations Act does not override the regulatory consent requirement of 25 C.F.R. § 151.8. Op. at 16-17. And the court held that the BIA's analysis of jurisdictional conflicts and the administrative burden under 25 C.F.R. § 151.10 was arbitrary and capricious. Id. at 18-19.

         The court "remand[ed] this action to the Region." Id. at 19. It enjoined the BIA from taking the land into trust without: (1) obtaining the Nation's consent; (2) reconsidering the section 151.10 criteria; and (3) considering the effect of Carcieri on the acquisition. Id. Department of Interior officials and the UKB brought this appeal.

         II.

         As an initial matter, we must determine whether we have jurisdiction over this appeal. See W. Energy All. v. Salazar, 709 F.3d 1040, 1046 (10th Cir. 2013) ("'[J]urisdiction is a threshold question which an appellate court must resolve before addressing the merits of the matter before it.'" (quoting Timpanogos Tribe v. Conway, 286 F.3d 1195, 1201 (10th Cir. 2002))).

         This court has jurisdiction "over all final decisions of federal district courts under 28 U.S.C. § 1291." Miami Tribe of Oklahoma v. United States, 656 F.3d 1129, 1137 (10th Cir. 2011). But "it is well settled law that the remand by a district court to an administrative agency for further proceedings is ordinarily not appealable because it is not a final decision." W. Energy All., 709 F.3d at 1047 (quotation and brackets omitted). "This general principle has been called the 'administrative-remand rule.'" Id. "In determining whether the district court's order was a final decision," this court considers "'the nature of the agency action as well as the nature of the district court's order.'" Id. (quoting New Mexico ex rel. Richardson v. BLM, 565 F.3d 683, 697 (10th Cir. 2009)). "Generally, to be final and appealable, the district court's judgment must end the litigation and leave nothing to be done except execute the judgment." Bender v. Clark, 744 F.2d 1424, 1426 (10th Cir. 1984) (quotation and brackets omitted). A district court's order is more likely an administrative remand when it "square[s] with the traditional notion of a 'remand,' wherein the reviewing court returns an action to a lower court for further proceedings." New Mexico, 565 F.3d at 698. "[A] district court's label for its own action carries little weight in determining the nature of that action on appeal[.]" Id. n.15.

         The district court characterized its holding as a remand to the agency. It held:

[T]he court finds in favor of the Cherokee Nation and remands this action to the Region. Furthermore, in accordance with the court's findings herein, the Secretary is enjoined from taking the Subject Tract into trust without the Cherokee Nation's written consent and full consideration of the jurisdictional conflicts and the resulting administrative burdens the acquisition would place on the Region. Before taking any land into trust for the UKB or the UKB Corporation, the Region shall consider the effect of Carcieri on such acquisition.

Op. at 19 (italics and underlining in original). The language of the court's order appears to call for an administrative remand because it instructs the Secretary to reconsider the application in light of its holdings regarding Nation consent, the section 151.10 factors, and the applicability of Carcieri.

         Viewing the district court's order "practically rather than technically," Bender, 744 F.2d at 1427, though, we conclude that the order was final, and therefore appealable. The district court's injunction preventing the Secretary from taking the Subject Parcel into trust without the Nation's consent essentially ends the proceedings in this case. No further action can be taken on the UKB's application without Nation consent, and the Nation has steadfastly withheld that consent throughout the fourteen years of the application's pendency. Accordingly, the district court's judgment "end[ed] the litigation" and "leave[s] nothing to be done except execute the judgment." Id. at 1426.

         Moreover, "the nature of the district court's order . . . does not square with the traditional notion of a 'remand,' wherein the reviewing court returns an action to a lower court for further proceedings." New Mexico, 565 F.3d at 698. In New Mexico, the district court enjoined the Bureau of Land Management from approving development leases without conducting more stringent environmental analyses. Id. We noted that "[t]he [district] court's order did not require BLM to recommence a proceeding, or indeed to take any action at all-it simply enjoined BLM from further [environmental] violations." Id. Similarly, the other holdings by the district court-that the BIA's analysis of the section 151.10 factors was arbitrary, and that its consideration of Carcieri was insufficient-do not mandate further proceedings. Because the UKB's application will not move forward until Nation consent is granted, there will be no occasion for the BIA to reconsider the application in light of the court's holdings.

         Accordingly, we conclude that the district court's order was not an administrative remand, but rather a final order that we have jurisdiction to review under section 1291.[9]

         III.

         In reaching its decision, the district court interpreted federal statutes-the IRA, the OIWA, and the 1999 Appropriations Act-and the 1866 Treaty. This court reviews those interpretations de novo. Par. Oil Co. v. Dillon Cos., Inc., 523 F.3d 1244, 1248 (10th Cir. 2008) (statutes); O Centro Espirita Beneficiente Uniao Do Vegetal v. Ashcroft, 389 F.3d 973, 988 (10th Cir. 2004) (treaties).

         Agency action shall be set aside if the action was "arbitrary, capricious, an abuse of discretion, or otherwise not in accordance with law." Citizens to Preserve Overton Park, Inc. v. Volpe, 401 U.S. 402, 414 (1971) (quotation omitted). An action is arbitrary and capricious if

the agency (1) entirely failed to consider an important aspect of the problem, (2) offered an explanation for its decision that runs counter to the evidence before the agency, or is so implausible that it could not be ascribed to a difference in view or the product of agency expertise, (3) failed to base its decision on consideration of the relevant factors, or (4) made a clear error of judgment.

Hillsdale Envtl. Loss Prevention, Inc. v. U.S. Army Corps of Engineers, 702 F.3d 1156, 1165 (10th Cir. 2012) (quoting New Mexico, 565 F.3d at 704).

         This court will "uphold the agency's action if it has articulated a rational basis for the decision and has considered relevant factors." Wolfe v. Barnhart, 446 F.3d 1096, ...


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