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United States District Court District of New Mexico The Case 1:17-cv-00654-KG-KK Document 68 Filed 04/10/18 Page 1 of 34 UNITED STATES DISTRICT COURT DISTRICT OF NEW MEXICO THE PUEBLO OF ISLETA, ) a federally-recognized Indian tribe, ) THE PUEBLO OF SANDIA, a ) federally-recognized Indian tribe, and ) THE PUEBLO OF TESUQUE, ) a federally-recognized Indian tribe, ) ) Plaintiffs, ) ) PUEBLO OF SANTA ANA, a federally- ) recognized Indian tribe and PUEBLO OF ) SANTA CLARA, a federally-recognized ) Indian tribe; and ) ) PUEBLO OF SAN FELIPE, a federally- ) recognized Indian tribe, ) ) Plaintiffs-in-Intervention, ) ) v. ) No. 1:17-CV-00654-KG-KK ) Susana Martinez, in her official capacity as the ) Governor of the State of New Mexico, ) Jeffrey S. Landers, in his official capacity ) as Chair of the Gaming Control Board of the ) State of New Mexico, Raechelle Camacho, ) in her official capacity as Acting State Gaming ) Representative, and Salvatore Maniaci, in his ) official capacity as a member of the Gaming ) Control Board, of the State of New Mexico, ) ) Defendants. ) ) PLAINTIFFS PUEBLO OF ISLETA’S AND PUEBLO OF SANDIA’S MOTION FOR SUMMARY JUDGMENT AND SUPPORTING AUTHORITIES 155632-1 Case 1:17-cv-00654-KG-KK Document 68 Filed 04/10/18 Page 2 of 34 TABLE OF CONTENTS TABLE OF AUTHORITIES ...................................................................................................... iii I. JURISDICTION AND SUMMARY JUDGMENT STANDARDS .............................. 1 A. Jurisdiction. ............................................................................................................. 1 B. Summary Judgment Standards. ............................................................................... 2 II. SUMMARY OF ARGUMENT ........................................................................................ 2 III. STATEMENT OF MATERIAL FACTS ON WHICH NO GENUINE ISSUE OF FACT EXISTS. ................................................................................................................. 4 IV. DEFENDANTS’ UNILATERAL DEMAND THAT FREE PLAY BE TREATED AS REVENUE UNDER THE 2007 COMPACT VIOLATES FEDERAL LAW BECAUSE IT IS NOT AUTHORIZED BY IGRA AND BECAUSE FREE PLAY IS NOT REVENUE UNDER GAAP. ................................................................................. 12 A. Whether Defendants’ Free Play Claim Violates Federal Law Must Be Decided Before The Defendants’ Motion On Arbitrability In Order To Protect The Federal Rights That Are The Subject Of This Action. ...................... 12 B. Federal Law Secures To The Pueblos The Right To Be Free From State Taxation And Regulation, Except As Negotiated And Expressly Agreed In A Compact That Comports With IGRA. .............................................................. 14 C. The Secretary Has Determined That Defendants’ Unilateral Demand That Free Play Be Treated As Revenue And Revenue Sharing Be Paid On Its Use Violates IGRA. ..................................................................................................... 15 D. Treating Free Play As Revenue And Paying Revenue Sharing On Its Use Plainly Violates Federal Law Because It Is Not Authorized By IGRA And Is Contrary To GAAP. .......................................................................................... 16 1. Defendants’ demand that free play be treated as revenue in calculating payments to the State under the 2007 Compact violates federal law because it is not authorized by IGRA. ................................... 17 2. Treating free play as revenue violates federal law because doing so is contrary to GAAP.................................................................................. 20 3. Defendants’ claim that the 2007 Compact does not require that each Pueblo’s Net Win be calculated in accordance with GAAP is baseless. .................................................................................................... 22 i 155632-1 Case 1:17-cv-00654-KG-KK Document 68 Filed 04/10/18 Page 3 of 34 4. Because the Defendants’ free play claim is barred by federal law, it is invalid and cannot be pursued. .............................................................. 27 V. CONCLUSION ............................................................................................................... 27 ii 155632-1 Case 1:17-cv-00654-KG-KK Document 68 Filed 04/10/18 Page 4 of 34 TABLE OF AUTHORITIES Cases California v. Cabazon Band of Mission Indians, 480 U.S. 202 (1987) .........................2, 14, 18, 19 Citizen Potawatomi Nation v. Oklahoma, 881 F.3d 1226 (10th Cir. 2018) ....................2, 3, 12, 16 City of Detroit v. Murray Corp. of Am., 355 U.S. 489 (1958) .......................................................19 Colorado River Indian Tribes v. NIGC, 466 F.3d 134 (D.C. Cir. 2006) .......................................20 Commc’n Workers of Am. v. Avaya, Inc., 693 F.3d 1295 (10th Cir. 2012) ...................................14 Crow v. Capitol Bankers Life Ins. Co., 1995-NMSC-018, 119 N.M. 452, 891 P.2d 1206 ..........25 Deephaven Private Placement Trading, Ltd. v. Grant Thornton & Co., 454 F.3d 1168 (10th Cir. 2006) .................................................................................................................................21 Dep’t of Revenue v. Kurth Ranch, 511 U.S. 767 (1994) ................................................................20 Gaming Corp. of Am. v. Dorsey & Whitney, 88 F.3d 536 (8th Cir. 1996) ......................................3 Hobbs v. McLean, 117 U.S. 567 (1886) ........................................................................................26 Idaho v. Shoshone-Bannock Tribes, 465 F.3d 1095 (9th Cir. 2006) .............................................18 In re Imergent Sec. Litig., No. 2:05-CV-204, 2009 WL 3731965 (D. Utah Nov. 2, 2009) ...........21 In re Indian Gaming Related Cases, 331 F.3d 1094 (9th Cir. 2003) .............................................18 Kennerly v. District Court, 400 U.S. 423 (1971) ...........................................................................23 Madawick Contracting Co. v. Travelers Ins. Co., 120 N.E.2d 520 (N.Y. 1954) ..........................25 Martinez v. City of Rio Rancho, 197 F. Supp. 3d 1294 (D.N.M. 2016) ..........................................2 Mastrobuono v. Shearson Lehman Hutton, Inc., 514 U.S. 52 (1995) ...........................................25 Michigan v. Bay Mills Indian Cmty., 134 S. Ct. 2024 (2014) .......................................................14 Nat’l Fed’n of Indep. Bus. v. Sebelius, 567 U.S. 519 (2012) .........................................................19 New Jersey v. Sprint Corp., 314 F. Supp. 2d 1119 (D. Kan. 2004) ...............................................21 New York v. United States, 505 U.S. 144 (1992) ...........................................................................20 NLRB v. Noel Canning, 134 S. Ct. 2550 (2014) ............................................................................25 Pueblo of Santa Ana v. Kelly, 104 F.3d 1546 (10th Cir. 1997) .....................................................23 Pueblo of Santa Ana v. Nash, 972 F. Supp. 2d 1254 (D.N.M. 2013) .......................... 12-13, 15, 23 Rincon Band of Luiseno Mission Indians of Rincon Reservation v. Schwarzenegger, 602 F.3d 1019 (9th Cir. 2010) ..................................................................................................17, 19 Sault Ste. Marie Tribe of Chippewa Indians v. Granholm, 475 F.3d 805 (6th Cir. 2007) ........6, 20 SEC v. Goldstone, 952 F. Supp. 2d 1060 (D.N.M. 2013) ..............................................................20 iii 155632-1 Case 1:17-cv-00654-KG-KK Document 68 Filed 04/10/18 Page 5 of 34 Seminole Tribe of Fla. v. Florida, 517 U.S. 44 (1996) ............................................................15, 16 United States v. Constantine, 296 U.S. 287 (1935) .......................................................................19 Walsh v. Schlecht, 429 U.S. 401 (1977) ........................................................................................26 Washington v. Confederated Tribes of Colville Indian Reservation, 447 U.S. 134 (1980)...........19 Wisconsin v. Ho-Chunk Nation, 512 F.3d 921 (7th Cir. 2008) ......................................................17 Statutes and Regulations Indian Gaming Regulatory Act (“IGRA”), 25 U.S.C. §§ 2701-2721 .................................... passim 28 U.S.C. § 1331 ..............................................................................................................................1 28 U.S.C. § 1362 ..............................................................................................................................1 25 C.F.R. § 542.19 .....................................................................................................2, 5, 20, 22, 25 25 C.F.R. § 571.12 .............................................................................................................2, 5, 9, 20 Compact Negotiation Act, N.M. Stat. Ann. §§ 11-13A-1 to -5 .......................................................6 State Audit Act, N.M. Stat. Ann. §§ 12-6-1 to -14 ..........................................................................8 Fed. R. Civ. P. 56 .........................................................................................................................1, 2 Regulatory Notices Compliance and Enforcement Procedures Under the Indian Gaming Regulatory Act, 58 Fed. Reg. 5833 (Jan. 22, 1993) .......................................................................................5, 20
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