This appeal raises a constitutional challenge to certain provisions of a 2011 Massachusetts law, "An Act Establishing Expanded Gaming in the Commonwealth" (the Massachusetts Gaming Act), 2011 Mass. Acts ch. 194 (largely codified at Mass. Gen. Laws ch. 23K), which sets procedures and standards for authorizing legalized gaming in the Commonwealth of Massachusetts.
KG Urban Enterprises, LLC, a potential applicant for a gaming license, argues that § 91 of the Act provides unauthorized preferences to Indian tribes and on that basis treats the southeast section of the state differently, and this constitutes a classification on the basis of race in violation of the Equal Protection Clause of the Fourteenth Amendment and is inconsistent with Congressional intent in the federal Indian gaming statute.
We affirm the denial of KG's request for injunctive and declaratory relief as to § 91, reject the remainder of KG's claims, vacate the district court's dismissal of the complaint, and remand for such further proceedings as may be appropriate.
This case involves two statutory schemes, one state and one federal. The state scheme is the Massachusetts Gaming Act. The federal scheme is the Indian Gaming Regulatory Act (IGRA), 25 U.S.C. §§ 2701-2721, which establishes a cooperative federal-state-tribal regime for regulating gaming by federally recognized Indian tribes on Indian lands.
The Massachusetts Gaming Act was enacted on November 22, 2011. The Act establishes "a Massachusetts gaming commission" (the Commission), which consists of five commissioners, defendants here. Mass. Gen. Laws ch. 23K, § 3(a). The Commission is the principal entity charged with implementing the provisions of the Act, including the licensing scheme at issue.
The Act authorizes gaming through the Commission's issuance of "Category 1" and "Category 2" licenses. A category 2 license, not at issue here, allows the licensee "to operate a gaming establishment with no table games and not more than 1,250 slot machines." Id. § 2. A category 1 license "permits the licensee to operate a gaming establishment with table games and slot machines." Id.
As to category 1 licenses, the Act creates three "regions," regions A, B, and C, corresponding to counties; region A covers the Boston area, B the western portion of the state, and C the southeastern portion of the state. See id. § 19(a). The Commission "may issue not more than 3 category 1 licenses based on the applications and bids submitted to the commission. Not more than 1 license shall be awarded per region." Id.
While the statute states that "[n]ot more than 1 license shall be awarded per region," the statute appears to contemplate that three category 1 licenses will be awarded in total. The statute specifies the circumstances where a category 1 license is not to be awarded in a region: "if the commission is not convinced that there is an applicant that has both met the eligibility criteria and provided convincing evidence that the applicant will provide value to the region in which the gaming establishment is proposed to be located and to the commonwealth, no gaming license shall be awarded in that region."
The Commission's solicitation of applications for category 1 licenses is a key initial step in the category 1 licensing process. The Act does not set a deadline by which the Commission must solicit applications for category 1 licenses, nor does the Act establish any timeframe for such solicitation. Rather, the Act provides that "[t]he commission shall issue a request for applications for category 1 and category 2 licenses; provided, however, that the commission shall first issue a request for applications for the category 2 licenses." Id. § 8(a). The Commission is required to set deadlines for the receipt of all such applications, id. § 8(c), and to "prescribe the form of the application," which must require certain detailed information about the entity requesting a license and its proposal, id. § 9(a).
Once the application is reviewed,
Between thirty and ninety days after the hearing, the Commission is to take action on the application: it must either grant a license, deny a license, or extend the period for issuing a decision by up to thirty days. Id. § 17(e). Licenses "shall only be issued to applicants who are qualified under the criteria set forth in [the Act], as determined by the commission." Id. § 19(a). As said, the Commission may under certain conditions determine that "no gaming license shall be awarded in that region." Id. Moreover, the Commission has "full discretion as to whether to issue a license." Id. § 17(g). The Act provides that the Commission's decision as to whether to issue a license is not reviewable: "Applicants shall have no legal right or privilege to a gaming license and shall not be entitled to any further review if denied by the commission." Id.
A license is to be valid for an initial fifteen-year period. Id. § 19(b). Further, if a license is granted "no other gaming license shall be issued by the commission in any region during that 15-year period." Id. The Commission is to establish license renewal procedures. Id. Licenses may not be transferred without majority approval of the Commission. Id. § 19(c).
Section 91, which is not codified in Chapter 23K, forms the basis of KG's primary challenge. 2011 Mass. Acts ch. 194, § 91. Section 91(a) provides that "[n]otwithstanding any general or special law or rule or regulation to the contrary, the governor may enter into a compact with a federally recognized Indian tribe in the commonwealth." Id. § 91(a). The Commission is, upon request of the Governor, to assist in negotiating the compact. Id. § 91(b). The Governor may "only enter into negotiations under this section with a tribe that has purchased, or entered into an agreement to purchase, a parcel of land for the proposed tribal gaming development and scheduled a vote in the host communities for approval of the proposed tribal gaming development." Id. § 91(c). If a compact is negotiated, it must "be submitted to the general court for approval." Id. § 91(d).
We divide subsection (e), on which KG's equal protection challenge focuses, into its two component clauses, which provide:
Id. § 91(e). It appears that all aspects of the state-law components of the first clause have, as of the date of this opinion, been complied with. These statutory procedures have been supplemented by the terms of the state-law compact entered into by the Governor and the Mashpee Wampanoag, as described later.
The statute does not, by its literal terms, preclude issuance of a category 1 license in Region C if a compact has been approved. However, KG argued before the district court and on appeal that the statute does bar issuance of a license if a compact is approved by the legislature by July 31 and the Commission has not then determined that the tribe will not have land taken into trust. The defendants do not dispute that interpretation of the statute.
Moreover, the approved compact provides:
Mashpee Tribal-State Compact § 2.6.
The Massachusetts Gaming Act also contains several other provisions relating to Indian gaming. The Act appropriates $5 million for use in negotiating and executing "a compact with a federally recognized Indian tribe in the commonwealth to establish a tribal casino in region C." 2011 Mass. Acts ch. 194, § 2A. The Commission is empowered to "provide assistance to the governor in negotiating a compact with a federally-recognized Indian tribe in the commonwealth." Mass. Gen. Laws ch. 23K, § 4(40). The Commission is required to:
Id. § 67.
The Act creates a thirteen member "gaming policy advisory committee," and requires one of the governor's eight appointees to the committee to "be a representative of a federally recognized Indian tribe in the commonwealth." Id. § 68(a). The committee must meet at least once a year to make advisory recommendations to the Commission. Id. The Act expressly provides that the committee's recommendations "shall not be binding on the commission." Id.
"Congress passed the Indian Gaming Regulatory Act in 1988 in order to provide a statutory basis for the operation and regulation of gaming by Indian tribes." Seminole Tribe of Fla. v. Florida, 517 U.S. 44, 48, 116 S.Ct. 1114, 134 L.Ed.2d 252 (1996). The IGRA was passed in part in response to the Court's decision in California v. Cabazon Band of Mission Indians, 480 U.S. 202, 107 S.Ct. 1083, 94 L.Ed.2d 244 (1987), which held that California lacked authority to regulate bingo gambling conducted by Indian tribes on Indian land within the state. Id. at 221-22, 107 S.Ct. 1083. The IGRA creates a cooperative federal-state-tribal scheme for regulation of gaming hosted by federally recognized Indian tribes on Indian land. In doing so the IGRA allows the states a limited and closely defined role in the process. It also limits the conditions under which tribes are allowed to enter into gaming. Both of these limits are implicated in this case.
The IGRA sets out when Class III gaming may be conducted:
Id. § 2710(d)(1). Compliance with these conditions is required from both states and tribes.
At the heart of this case are the provisions of the IGRA which make clear that tribal gaming may only be conducted by an "Indian tribe" on "Indian lands," as both terms are defined in the IGRA. See, e.g., id. ("Class III gaming activities shall be lawful on Indian lands only if...." (emphasis added)); id. § 2710(d)(2)(C) ("[C]lass III gaming activity on the Indian lands of the Indian tribe shall be fully subject to the terms and conditions of the Tribal-State compact...." (emphasis added)); id. § 2710(d)(8)(A) ("The Secretary [of the Interior] is authorized to approve any Tribal-State compact entered into between an Indian tribe and a State governing gaming on Indian lands of such Indian tribe." (emphasis added)). The Supreme Court has recently remarked that under the IGRA, "an Indian tribe may conduct gaming operations on `Indian lands.'" Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians v. Patchak, ___ U.S. ___, 132 S.Ct. 2199, 2203 n. 1, 183 L.Ed.2d 211 (2012).
We highlight the two key IGRA provisions important to the equal protection challenge at issue here: the Indian lands definition and the compact process, both described below.
Of particular importance is the term "Indian lands," which is defined as:
Id. § 2703(4).
The IGRA also makes clear that gaming may only be conducted if a tribal-state compact is negotiated and approved by the Secretary of the Interior. Id. § 2710(d)(1)(C), (d)(3)(B). As to the tribal-state negotiation process, the IGRA provides:
Id. § 2710(d)(3). Tribal-state compacts "may" cover a variety of subjects, including any "subjects that are directly related to the operation of gaming activities." Id. § 2710(d)(3)(C)(vii).
After such compacts are negotiated, they must be submitted to the Secretary of the Interior for approval. The IGRA provides: "(A) The Secretary is authorized to approve any Tribal-State compact entered into between an Indian tribe and a State governing gaming on Indian lands of such Indian tribe." Id. § 2710(d)(8).
Assuming there is a compact as defined in (A), the IGRA goes on to provide:
Id. Once a tribal-state compact is negotiated and approved by the Secretary, and the other requirements of § 2710(d)(1) are met, Class III gaming may be conducted.
The IGRA contains additional provisions in another section governing "[g]aming on lands acquired after October 17, 1988." Id. § 2719. The lands here were acquired by the Mashpee after October 17, 1988. This section provides that, except as provided in subsections (a) and (b), "gaming regulated by this chapter shall not be conducted on lands acquired by the Secretary in trust for the benefit of an Indian tribe after October 17, 1988." Id. § 2719(a). Subsection (a) contains two exceptions relating to Indian reservations not relevant here. Subsection (b) contains several exceptions relevant only to particular tribes listed in the statute, and two general exceptions:
Id. § 2719(b). This section also provides that "[n]othing in this section shall affect or diminish the authority and responsibility of the Secretary to take the land into trust." Id. § 2719(c).
The statute conferring authority on the Secretary of the Interior to take land into trust is 25 U.S.C. § 465, which authorizes the Secretary to take land into trust "for the purpose of providing land for Indians." Id. Section 479 provides that "[t]he term `Indian' as used in this Act shall include all persons of Indian descent who are members of any recognized Indian tribe now under Federal jurisdiction." Id. § 479. The Secretary has promulgated regulations governing the land into trust process. 25 C.F.R. pt. 151.
The Supreme Court has interpreted the language of § 479 in a way which directly impacts the analysis here. In Carcieri v. Salazar, 555 U.S. 379, 129 S.Ct. 1058, 172 L.Ed.2d 791 (2009), the Court
In a concurring opinion, Justice Breyer stated that the "interpretation that reads `now' as meaning `in 1934' may prove somewhat less restrictive than it at first appears" because "a tribe may have been `under Federal jurisdiction' in 1934 even though the Federal Government did not believe so at the time." Id. at 1069 (Breyer, J., concurring). Justice Souter and Justice Ginsburg, concurring in part and dissenting in part, agreed with this analysis. Id. at 1071 (Souter, J., concurring). We do not know whether the Mashpee's land in trust application to the Secretary includes any such allegation or support for such a claim. No party has provided such information.
The Court recently summarized Carcieri as holding that "§ 465 authorizes the Secretary to take land into trust only for tribes that were `under federal jurisdiction' in 1934." Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians, 132 S.Ct. at 2204. In a footnote, the Court remarked that it was not addressing the scope of Carcieri, including whether the tribe at issue there "was `under federal jurisdiction' in 1934, as Carcieri requires," and "how that question relates to Patchak's allegation that the Band was not `federally recognized' at the time." Id. at 2204 n. 2.
KG Urban Enterprises, LLC, is an equity development company that specializes in the redevelopment of urban brownfield sites. Over the past four years, it has invested $4.6 million dollars in preparing a plan for converting a site in downtown New Bedford, Massachusetts, into an over $1 billion multi-use property that includes a gaming facility. KG plans on applying for a Region C gaming license for that property "as soon as it is permitted to do so."
KG filed its complaint on November 22, 2011, the same day the Massachusetts Gaming Act was passed, naming as defendants the Governor of Massachusetts and the Commission members.
KG's complaint alleged, and the parties agree on appeal, that there are two federally recognized tribes in Massachusetts-the
The Mashpee and the Governor of Massachusetts entered into a tribal-state compact on July 12, 2012. The compact provides that gaming may only be conducted on an "Approved Gaming Site" defined as "a single site on Indian Lands, as defined in IGRA, that is legally eligible under IGRA for the conduct of" gaming. Mashpee Tribal-State Compact § 3.3. The compact further provides that "the Tribe is authorized to operate [gaming] only in accordance with this Compact, IGRA and the Tribal Gaming Ordinance and the Tribe shall only conduct such Gaming on Indian Lands as authorized under IGRA." Id. § 4.1. The compact notes that "[t]he Tribe presently has no lands held in trust, for Gaming purposes or otherwise." Id. § 9.1.1. The compact provides it is to "become effective upon the publication of notice of approval by the United States Secretary of the Interior in the Federal Register in accordance with" the IGRA. Id. § 22. The compact was approved by the House of the Massachusetts legislature on July 18, 2012, and by the Senate on July 26, 2012. H. 4261, 187th Gen. Court (Mass. 2012). It is against this general backdrop that the legal issues are framed.
The most powerful of KG's theories on appeal is that § 91 of the Massachusetts Gaming Act discriminates on the basis of race, harming KG's ability to seek a commercial gaming license and the terms that would govern any such license, in violation of the Equal Protection Clause of the Fourteenth Amendment.
KG's complaint also raised equal protection claims as to the $5 million in funding for negotiation of a compact and the seat reserved for a representative of a federally recognized Indian tribe on the advisory committee.
The complaint alleged that § 91 of the Act caused and will cause to KG several injuries: (1) "KG will be locked out of the application process for a gaming license until July 31, 2012, and may never have an opportunity to compete for a license," if a tribal-state compact is entered into, (2) the uncertainty over whether non-tribal entities would be able to apply for a gaming license causes harm and is deterring investors and operators from pursuing opportunities in the southeast region, and (3) even if non-tribal applications were at some point accepted, licensees in Region C would be at a competitive disadvantage because the other two regions were likely to have operational casinos before Region C. The complaint further alleged that because "the federal process for awarding land-in-trust is in a state of paralysis in the wake of Carcieri ... there is no prospect that the Mashpee Wampanoag will be in a position to engage in casino-style gaming consistent with the IGRA in the foreseeable future."
As to relief, KG requested (1) a declaratory judgment that the Massachusetts Gaming Act is unconstitutional in its entirety, or at a minimum as to its Indian tribe related provisions; (2) a declaration that the Act is preempted to the extent it authorizes Indian tribes to engage in gaming without complying with the IGRA; (3) a preliminary and permanent injunction preventing the defendants from enforcing the unlawful provisions of the Massachusetts Gaming Act, and (4) an award of reasonable attorneys' fees.
The same day it filed the complaint, KG also filed a motion for a preliminary injunction blocking the defendants from enforcing the challenged provisions of the Act. In support of the motion, KG attached an affidavit of KG's managing director, which essentially reiterated the facts as to KG's New Bedford project and the injuries to KG arising out of § 91 as alleged.
The defendants opposed the motion on the merits, and argued that KG's claims regarding § 91 were not ripe and the court accordingly lacked jurisdiction. The defendants also submitted, on January 27, 2012, an affidavit from Stephen P. Crosby, who was appointed Chairman of the Gaming Commission on December 13, 2011, stating that the Commission "will almost certainly not be accepting applications any earlier than October 2012," and possibly not until sometime in 2013. The Chairman was the only member of the Commission to be appointed at that point, the remaining members would need to be appointed,
On February 16, 2012, the district court denied KG's request for a preliminary injunction. KG Urban Enters., LLC v. Patrick, 839 F.Supp.2d 388, 407 (D.Mass. 2012). The court first found that the issues of ripeness, standing, sovereign immunity, and Pullman abstention did not preclude it from addressing the merits, with the exception of KG's challenge to the advisory committee seat, which the district court dismissed on standing grounds. Id. at 396-99.
On the merits, the court rejected both of KG's legal theories. The court held that the Massachusetts Gaming Act was not preempted by the IGRA, in part because § 91 "does not create a separate tribal gaming regime in Massachusetts but rather establishes the procedures by which IGRA-authorized compacting may take place under Massachusetts law." Id. at 401.
The court also rejected the equal protection claim as to § 91. The court treated the equal protection claims under federal law and state law as "coextensive" with one another. Id. at 402. The court reasoned that because § 91 of the Massachusetts Gaming Act was enacted in the state's exercise of its authority delegated to it under the IGRA, the Court's holding in Washington v. Confederated Bands & Tribes of the Yakima Indian Nation, 439 U.S. 463, 99 S.Ct. 740, 58 L.Ed.2d 740 (1979), mandated that only rational basis review be applied to the statute, rather than strict scrutiny. KG Urban Enters., 839 F.Supp.2d at 404-05. Applying that standard, the court found that the rational basis test was satisfied. Id. at 405-06.
The district court also dismissed the complaint, explaining that "because plaintiff brings only a facial equal protection challenge to the Gaming Act and no further briefing or proceedings would affect this Court's constitutional analysis," dismissal was proper. Id. at 407. KG appeals.
KG's equal protection claim presents a question of law and so is reviewed de novo. See, e.g., United States v. Rehlander, 666 F.3d 45, 47 (1st Cir.2012) ("The issues before us are legal and our review is therefore de novo."). We review the district court's dismissal of the complaint de novo. See Feliciano-Hernández v. Pereira-Castillo, 663 F.3d 527, 532 (1st Cir.2011), cert. denied, ___ U.S. ___, 132 S.Ct. 2742, 183 L.Ed.2d 615 (2012). KG requests not only that its complaint be reinstated, but that the case be remanded with judgment entered in its favor and that § 91(e) be permanently enjoined. We review denials of both permanent and preliminary injunctive relief for abuse of discretion (with legal issues reviewed de novo). Mercado-Salinas v. Bart Enters. Int'l, Ltd., 671 F.3d 12, 19-20 (1st Cir. 2011); Animal Welfare Inst. v. Martin, 623 F.3d 19, 26 (1st Cir.2010).
KG has narrowed the claims it has pursued on appeal. KG no longer advances its claim that the Massachusetts Gaming Act is directly in conflict with and so
Defendants argue (1) that KG's claim as to § 91 is not ripe and (2) that KG has no standing to challenge the composition of the advisory committee established by the Massachusetts Gaming Act.
We address the challenge to the advisory committee and KG's state-law claim before turning to the challenge to § 91.
We reject KG's challenge as to the advisory committee on standing grounds. KG's complaint does not plead any facts as to why it has standing to challenge the committee's composition. Its sole argument is that Buckley v. Valeo, 424 U.S. 1, 96 S.Ct. 612, 46 L.Ed.2d 659 (1976) (per curiam), holds that an individual subject to the jurisdiction of a regulatory agency may challenge the legality of appointments to that body. Buckley was not so broad; rather it held that "[p]arty litigants with sufficient concrete interests at stake may have standing to raise constitutional questions of separation of powers with respect to an agency designated to adjudicate their rights." Id. at 117, 96 S.Ct. 612 (emphasis added). KG bears the burden and does not develop any argument that it has sufficiently concrete interests at stake as to the advisory committee, or that Buckley applies to committees that are solely advisory. The contours of Buckley's standing analysis are not well-defined, and at least one circuit has held that Buckley does not confer standing on plaintiffs who are not "directly subject to the governmental authority they seek to challenge, but merely assert that they are substantially affected by the exercise of that authority." Comm. for Monetary Reform v. Bd. of Governors of the Fed. Reserve Sys., 766 F.2d 538, 543 (D.C.Cir. 1985). The dismissal of this claim for lack of standing is affirmed. See Lujan v. Defenders of Wildlife, 504 U.S. 555, 561, 112 S.Ct. 2130, 119 L.Ed.2d 351 (1992).
KG newly argues that it is entitled to greater protection under the state constitution than the federal. Before the district court, KG initially argued that the standard for equal protection analysis was the same under the federal constitution and under the Massachusetts Declaration of Rights. KG later submitted a supplemental filing regarding Finch v. Commonwealth Health Insurance Connector Authority, 461 Mass. 232, 959 N.E.2d 970 (2012), arguing that the decision "further demonstrates that the Act violates the Equal Protection Clause and Declaration of Rights."
While that opinion was issued after KG's motion for a preliminary injunction was filed, the legal principle for which KG cites the case was decided by the Supreme Judicial Court in an earlier opinion in the same case, before KG's motion was filed. See Finch v. Commonwealth Health Ins. Connector Auth., 459 Mass. 655, 946 N.E.2d 1262, 1276 (2011) ("Where the Federal government has made a binding decision regarding the treatment of aliens, that decision will be reviewed according to the standards applicable to the Federal government even though the immediate actor may be a State government. In comparison, where the State acts on its own authority, it cannot shelter behind the existence of Congress's plenary authority, and
KG's failure to timely raise the argument that a different standard applies to its state-law claim leads to the conclusion that the state constitutional claim adds nothing to KG's claim in this court. See Nat'l Amusements, Inc. v. Town of Dedham, 43 F.3d 731, 748-49 (1st Cir.1995) (holding that where a party treats federal and state constitutional provisions "identically" before the district court, the party has waived any argument that the provisions are distinct). We affirm dismissal of the state-law claim without prejudice, particularly because "the claim raises a novel or complex issue of State law." 28 U.S.C. § 1367(c)(1).
We turn now to the heart of KG's suit, the equal protection challenge to § 91.
We review de novo, Doe v. Bush, 323 F.3d 133, 138 (1st Cir.2003), and reject the defendants' argument that the challenge is not ripe.
Turning to the merits, the parties essentially agree that the level of scrutiny that applies to § 91 is dispositive of the equal protection claim.
The defendants respond with two arguments, which basically state all-or-nothing propositions. First, defendants broadly claim that, under Morton v. Mancari, 417 U.S. 535, 94 S.Ct. 2474, 41 L.Ed.2d 290 (1974), the state's classification based on tribal status is political, not racial, in nature, and so subject only to rational basis review. Second, defendants argue, more narrowly, that, under Washington v. Confederated Bands & Tribes of the Yakima Indian Nation, 439 U.S. 463, 99 S.Ct. 740, 58 L.Ed.2d 740 (1979), even if the classification were racial in nature, it is authorized by the IGRA and thus subject only to rational basis review.
The defendants have not offered a middle ground nor have they formally argued that a state may choose to allow at least a limited grace period to tribes to attempt to obtain needed approvals under the IGRA from the Secretary (and Congress, if needed), though that is self-evidently one purpose of § 91.
There are difficulties with each party's arguments. In the end, though, it is clear to us that KG's suit should not have been dismissed, and that KG is not entitled at this point to the equitable relief it seeks. For reasons discussed below, we affirm the denial of a grant of relief as an appropriate exercise of the discretion as to whether to issue both a preliminary injunction and a declaratory judgment under 28 U.S.C. § 2201(a). We first outline the legal issues raised as to the equal protection claim.
The defendants' first argument is that a state-granted preference to a tribe is not a racial preference and so entails only rational basis review. This argument relies on language used by the Court in Mancari, 417 U.S. 535, 94 S.Ct. 2474. There, the Court addressed whether a federal law granting an employment preference for qualified Indians in a federal agency, the Bureau of Indian Affairs (BIA), violated the equal protection component of the Due Process Clause of the Fifth Amendment. 417 U.S. at 537, 94 S.Ct. 2474. A statute directed the Secretary of the Interior to adopt standards "for Indians who may be appointed, without regard to civil-service laws, to the various positions maintained, now or hereafter, by the Indian office, in the administration of functions or services affecting any Indian tribe. Such qualified Indians shall hereafter have the preference to appointment to vacancies in any such positions." Id. at 537-38, 94 S.Ct. 2474 (quoting 25 U.S.C. § 472) (internal quotation mark omitted). The BIA adopted a policy that "[w]here two or more candidates who meet the established qualification requirements are available for filling a vacancy. If one of them is an Indian, he shall be given preference in filling the vacancy." Id. at 538 n. 3, 94 S.Ct. 2474.
The Court rejected the equal protection challenge to the federal statute. The
The Court held that "this preference does not constitute `racial discrimination.' Indeed, it is not even a `racial' preference. Rather, it is an employment criterion reasonably designed to further the cause of Indian self-government and to make the BIA more responsive to the needs of its constituent groups." Id. at 553-54, 94 S.Ct. 2474 (footnote omitted). The Court further explained:
Id. at 554, 94 S.Ct. 2474 (citation and footnote omitted). This passage was followed by rather pointed language that if the preference were applied to employment in federal agencies not related to Indians, a different question would be presented:
Id. at 554, 94 S.Ct. 2474.
In a footnote, the Court remarked: "The preference is not directed towards a `racial' group consisting of `Indians'; instead, it applies only to members of `federally recognized' tribes. This operates to exclude many individuals who are racially to be classified as `Indians.' In this sense, the preference is political rather than racial in nature." Id. at 553 n. 24, 94 S.Ct. 2474. The Commonwealth relies on but overreads the footnote.
The Court concluded by explaining that "[a]s long as the special treatment can be tied rationally to the fulfillment of Congress' unique obligation toward the Indians, such legislative judgments will not be disturbed," and that this standard was satisfied. Id. at 555, 94 S.Ct. 2474.
Mancari's analysis as to federal laws giving preference based on "Congress' unique obligation toward the Indians" has been reaffirmed. See, e.g., Washington v. Wash. State Commercial Passenger Fishing Vessel Ass'n, 443 U.S. 658, 673 n. 20, 99 S.Ct. 3055, 61 L.Ed.2d 823 (1979) (noting that "this Court ... has repeatedly held that the peculiar semisovereign and constitutionally recognized status of Indians justifies special treatment on their behalf when rationally related to the Government's `unique obligation toward the
However, it is quite doubtful that Mancari's language can be extended to apply to preferential state classifications based on tribal status. Mancari itself relied on several sources of federal authority to reach its holding, including the portion of the Commerce Clause relating to Indian tribes, the treaty power, and the special trust relationship between Indian tribes and the federal government. 417 U.S. at 552-53, 94 S.Ct. 2474.
The states have no such equivalent authority,
KG argues that the state's argument that no racial classification is involved is undercut by Rice v. Cayetano, 528 U.S. 495, 120 S.Ct. 1044, 145 L.Ed.2d 1007 (2000). In Rice, a case under the Fifteenth Amendment, the Court declined to "extend the limited exception of Mancari to a new and larger dimension," id. at 520, 120 S.Ct. 1044, and rejected the state of Hawaii's claim that Mancari applied to allow a voting scheme the state established regarding the Office of Hawaiian Affairs, id. at 522, 120 S.Ct. 1044. The voting scheme permitted only "Hawaiians," defined as "any descendant of the aboriginal peoples inhabiting the Hawaiian Islands which exercised sovereignty and subsisted in the Hawaiian Islands in 1778," to vote for the trustees of the Office. Id. at 509, 120 S.Ct. 1044 (quoting Haw.Rev.Stat. § 10-2). The Court held this special favorable treatment of Hawaiians was an impermissible racial classification. Id. at 517-22, 120 S.Ct. 1044. The Court also held that "[a]ncestry can be a proxy for race," and was so in the context of the statute at issue there. Id. at 514, 120 S.Ct. 1044. The effect of Rice on a Fourteenth Amendment claim involving federally recognized tribes is unclear.
The defendants cite no authority holding that state preferential classifications based on tribal status which are not authorized by federal law are nonetheless not racial classifications under Mancari. Instead, they cite a number of cases upholding state laws, which are not like this case, said to be authorized by federal law under the rationale of Yakima. See Artichoke Joe's Cal. Grand Casino v. Norton, 353 F.3d 712,
We turn next to the defendants' argument that nevertheless the state may still make the classification, because § 91 is authorized by the IGRA under Yakima. In the present posture of this case, that too is quite doubtful.
The premise of defendants' argument is their assertion that § 91 was "enacted under explicit authority granted by Congress in IGRA," and so is subject to rational basis review under Yakima. While stronger than the Mancari rationale, and the "authorization" rationale states a sound argument where it applies, it is questionable whether the IGRA "authorizes" the state's actions on the present facts. Indeed, KG in effect argues that as the Supreme Court has interpreted the land in trust statute in Carcieri, the intent of Congress was that the Secretary could not take land into trust for tribes such as the Mashpee, and so the intent of Congress is on the other side of the issue.
In Yakima, the Court addressed the equal protection analysis of state laws as to Indian tribes where the state acted pursuant to Congressional authorization. The State of Washington, pursuant to authorization granted by federal Public Law 280,
Id. at 500-01, 99 S.Ct. 740. This portion of Yakima has not been addressed by the Court since Yakima was decided.
It would be difficult to conclude that the IGRA "authorizes" the Massachusetts statute under these circumstances — where there are no Indian lands in Region C at present within the meaning of the IGRA. Further, Carcieri may in the end prohibit the Secretary from taking the Mashpee lands into trust and so making them Indian lands, a question not yet resolved.
KG does not dispute that if a federally recognized tribe in Massachusetts currently possessed "Indian lands" within the meaning of the IGRA,
KG argues with some force that the fact that a tribe may, in the future, acquire Indian lands is insufficient for § 91 to be considered "authorized" in the Yakima sense by the IGRA. Instead, KG argues, a tribe
We outline the present state of affairs as we understand it. The Mashpee have submitted a land in trust application to the Bureau of Indian Affairs, requesting that the Bureau take land into trust for purposes of operating a casino in Massachusetts. See 77 Fed. Reg. 32,132, 32,133 (May 31, 2012) (BIA notice requesting comments for purposes of preparing an environmental impact statement for the proposed transfer into trust of 146.39 acres in the City of Taunton, to be taken into trust "for the development of a casino, hotel, parking, and other facilities supporting the casino," as well as a proposed transfer into trust of 170.1 acres in the Town of Mashpee, Massachusetts, for other purposes). The agreed-on tribal-state
The strongest argument made by KG is based on Carcieri: that even if being in the application process to have a Secretary (with authority) take the purchased land into trust might suffice for purposes of being found authorized under the IGRA as a general matter, if no land can be taken into trust given Carcieri, § 91 cannot be viewed as authorized by the IGRA. KG's argument starts from the premise that the Mashpee were federally recognized only after 1934.
KG's argument that the IGRA cannot "authorize" § 91 in these circumstances rests not only on Carcieri but also on the language of the IGRA, which repeatedly uses the term "Indian lands" in explaining when Class III gaming is permitted. In particular, the term is used in the context of explaining when tribes and states may negotiate a tribal-state compact:
The Sixth Circuit has interpreted subsection (A) in Match-E-Be-Nash-She-Wish Band of Pottawatomi Indians v. Engler, 304 F.3d 616 (6th Cir.2002). There, the court addressed whether an Indian tribe which did not possess Indian lands could compel a state to negotiate a tribal-state compact. The court held that the tribe could not do so, as "[h]aving jurisdiction over land for the casino is a condition precedent to negotiations and federal jurisdiction," based on the "plain language of § 2710(d)(3)(A)." Id. at 618. The court explained that "[s]ection (3)(A) describes not just an Indian tribe, but one that is in possession of land." Id. Of course, there is a distinction: there the tribe was trying to force the state to negotiate; here the state wishes to negotiate.
KG's argument based on Carcieri goes beyond the language of the IGRA describing when a compact may be negotiated to a more basic premise of the IGRA: that Class III gaming may occur only on Indian lands. Because the Secretary presently most likely lacks authority under the IGRA to take land into trust for the Mashpee, KG argues, there is no real prospect, absent an act of Congress, for land to be taken into trust, and so § 91 cannot be viewed as authorized.
The defendants' response to this reading of the statute relies not upon the terms of the statute, but on certain actions taken by the Secretary, albeit in factual situations not identical to this. The Secretary's present position appears to be that tribal-state compacts may be negotiated and approved by the Secretary even if a tribe does not currently possess Indian lands, conditional upon the tribe's acquiring Indian lands. The most recent position of the Secretary, cited by the parties, was articulated in a March 2011 approval of a tribal-state compact. There, the Secretary approved a tribal-state compact, with the authorization of any gaming facility under the compact contingent on the relevant land being "acquired in trust by the Secretary for the tribe."
The Secretary's views on whether tribal-state compacts may be approved before the tribe possesses land that is taken into trust have varied over the years.
The Secretary has promulgated regulations governing the procedures for submitting a tribal-state compact, see 25 C.F.R. pt. 293, but these regulations do not address the matter before us.
In sum, whether § 91 is "authorized" by the IGRA such that it falls within Yakima and is subject to only rational basis review is far from clear, presents a difficult question of statutory interpretation, and implicates a practice of the Secretary of the Interior not challenged in this suit. There is apparently no judicial authority addressing the question of whether a state may negotiate a tribal-state compact with a federally recognized tribe that does not presently possess Indian lands.
The argument, of course, would become weaker with the passage of time and the continuation of the status that there are no "Indian lands" in the region. The tribal-state compact entered into weakens the state's position by extending the period of time, as we explain below. And the argument is qualitatively different, and even weaker, to the extent that Congressional action is required to provide the Secretary authority to take this land into trust. It is in this context that we turn to the relief requested by KG and the disposition of this suit.
In this suit, KG requests only equitable relief: a declaration that § 91 of the Massachusetts Gaming Act violates the Equal Protection Clause, preliminary and permanent injunctive relief, and associated attorneys' fees. We view the appropriate resolution of this appeal through the lens of KG's request for equitable relief.
We start with KG's request for a preliminary injunction. Four factors govern the issuance of preliminary injunctive relief:
González-Fuentes v. Molina, 607 F.3d 864, 875 (1st Cir.2010), cert. denied, ___ U.S. ___, 131 S.Ct. 1568, 179 L.Ed.2d 476 (2011). In this case, several circumstances weigh strongly against granting injunctive relief at this point in time.
As to likelihood of success on the merits, the law is far from clear, and both sides have weaknesses in their positions, as we have just outlined. That factor is only one of four we consider. First, it is clear from the affidavit of the Chairman of the Gaming Commission that the Commission is not now soliciting applications for the other two regions, will not do so until October 2012 at the earliest, and may not do so until some point in 2013. As a result, the nature of KG's present injury is relatively limited. For reasons other than § 91, the category 1 licensing process may not move forward in Region C for months to come.
Second, the shape of the issues raised in this suit, and the attendant claims of injury, could well change depending on future events. It has already changed since oral argument, with the approval of the compact.
What is more difficult is the indefiniteness of when the Gaming Commission may, after August 1, 2012, determine that the tribe will not have land taken into trust, which would then trigger the competitive license application process. The statute does not set a date for this determination, instead providing only that "if, at
There are two provisions in the Mashpee Tribal-State Compact that raise the prospect of further delays and cast doubt on the two "examples" provided at oral argument. First, the compact provides that "if the United States Secretary of the Interior fails to accept such land in trust" as to the current land in trust application, "the Tribe may identify alternative land in Region C to be acquired in trust for Gaming under this Compact," and so presumably begin the land in trust process anew. Mashpee Tribal-State Compact § 5.2.2. This raises the prospect of multiple land in trust applications and further delay as to when the Commission might determine that the Mashpee will not have land taken into trust under § 91(e).
Second, the compact provides that if it "is not approved by the United States Secretary of the Interior as required by IGRA, the Governor agrees that, if requested by the Tribe, the Governor will immediately resume negotiations in good faith with the Tribe for an amended compact." Mashpee Tribal-State Compact § 18.8. This raises the prospect that even the Secretary's disapproval of the compact will not trigger a Commission decision to commence the competitive licensing process.
There also remains the potential that the Commission might wait years until the Secretary makes a determination as to the compact or land in trust application before itself acting under § 91.
Beyond any such more typical delays in the land in trust application and compact approval processes, there is also the issue of whether the Secretary of the Interior has the authority to take land into trust for the Mashpee in the wake of Carcieri. If the Secretary lacks such authority, that would require Congressional action before land could be taken into trust. This adds yet another layer of uncertainty and potential delay. If such lengthy delays occurred, this would undercut the argument that § 91 is meant as a temporary accommodation to the IGRA process to allow lands to be taken into trust and so is "authorized" in that minimal sense.
Given this situation, the lack of clear answers on questions of both state and federal law, the shifting of the nature of the injury to KG, and the apparent attempt to allow some time for the IGRA process to work (including any Carcieri fix), we cannot say there was an abuse of discretion in the denial of preliminary injunctive relief. "An injunction is an exercise of a court's equitable authority, to be ordered only after taking into account all of the circumstances that bear on the need for prospective relief." Salazar v. Buono, ___ U.S. ___, 130 S.Ct. 1803, 1816, 176 L.Ed.2d 634 (2010). "Equitable relief is not granted as a matter of course, and a court should be particularly cautious when contemplating relief that implicates public interests." Id. (citations omitted).
These considerations also lead us to affirm the denial of KG's request for injunctive and declaratory relief at this point in time. The Supreme Court has made clear that "the Declaratory Judgment Act has been understood to confer on federal courts unique and substantial discretion in deciding whether to declare the rights of litigants. On its face, the statute provides that a court `may declare the rights and other legal relations of any interested party seeking such declaration.'" Wilton v. Seven Falls Co., 515 U.S. 277, 286, 115 S.Ct. 2137, 132 L.Ed.2d 214 (1995) (quoting 28 U.S.C. § 2201(a)). The Court has explained that "the propriety of declaratory relief in a particular case will depend upon a circumspect sense of its fitness informed by the teachings and experience concerning the functions and extent of federal judicial power." Id. at 287, 115 S.Ct. 2137 (quoting Pub. Serv. Comm'n of Utah v. Wycoff Co., 344 U.S. 237, 243, 73 S.Ct. 236, 97 L.Ed. 291 (1952)) (internal quotation marks omitted).
The district court's dismissal of the complaint is another matter. We simply cannot say that KG's equal protection claim as to § 91 fails to state a claim on which relief may be granted, or that the issuance of equitable relief may not be appropriate at some future date.
We also affirm the dismissal with prejudice of KG's claims as to the $5 million
No costs are awarded.
The Chairman must approve any tribal ordinance allowing gaming "unless the Chairman specifically determines that — (i) the ordinance or resolution was not adopted in compliance with the governing documents of the Indian tribe, or (ii) the tribal governing body was significantly and unduly influenced in the adoption of such ordinance or resolution by any person identified in section 2711(e)(1)(D) of this title." Id. § 2710(d)(2)(B).
The NIGC has authority to levy and collect fines and initiate proceedings to shut down gaming operations against tribal operators or contractors engaged in gaming, "for any violation of any provision of this chapter, any regulation prescribed by the Commission pursuant to this chapter, or tribal regulations, ordinances, or resolutions approved under section 2710 or 2712 of this title." Id. § 2713(a)(1).
The Seminole Tribe Court held that Congress lacked authority to abrogate the states' sovereign immunity to allow suit to be brought to enforce the good-faith requirement. Id. at 47, 116 S.Ct. 1114. The Court also held that the Ex parte Young doctrine may not be used to enforce that requirement against state officials, and instead only the remedial scheme of § 2710(d)(7) may be used to enforce that right. Id. at 47, 76, 116 S.Ct. 1114.
This does not address or foreclose KG's remaining arguments that the differentiation of Region C from the other two regions rests expressly on the tribal preference and if that preference fails, then the differentiation must fail. Since the state legislature has tied the differentiation solely to the tribal preference, this is not an instance in which a state has merely decided to treat its regions separately. See Montalvo-Huertas v. Rivera-Cruz, 885 F.2d 971, 981 (1st Cir.1989) (explaining that "territorial uniformity is not a constitutional prerequisite" under the Equal Protection Clause (quoting McGowan v. Maryland, 366 U.S. 420, 427, 81 S.Ct. 1101, 6 L.Ed.2d 393 (1961)) (internal quotation marks omitted)).