Ryan Harvey, Rocks Off, Inc. v. Ute Indian Tribe of the Uintah
416 P.3d 401, 851 Utah Adv. Rep. 19, 2017 UT 75 (2017)
Sections
Rule of Law:
Tribal sovereign immunity bars suits against a tribe unless waived, but does not bar suits for injunctive relief against tribal officials under Ex parte Young or individual-capacity damages suits; however, under the tribal exhaustion doctrine, state courts must pause proceedings to allow tribal courts the first opportunity to determine the scope of their own jurisdiction regarding conduct on tribal land.
Facts:
- Plaintiffs Ryan Harvey and his companies, Rocks Off, Inc. and Wild Cat Rentals, Inc., provided equipment and services to oil and gas companies operating on the Uintah and Ouray Reservation.
- Tribal officials from the Ute Tribal Employment Rights Office (UTERO) demanded Harvey obtain tribal business licenses and access permits, threatening to shut down his operations if he refused, even though Harvey operated on private fee land rather than tribal land.
- After Harvey obtained the permits, Commissioner Cesspooch, a tribal official, allegedly demanded a bribe from Harvey, stating he 'sure needed a good riding horse,' which Harvey refused to pay.
- Shortly after the refusal, the Tribal officials revoked Harvey's access permits.
- The UTERO Commission subsequently sent a letter to all oil and gas companies operating on the reservation threatening sanctions against any company that did business with Harvey or his companies.
- As a result of the letter, major oil and gas companies, including Newfield Production Company, ceased doing business with Harvey, causing significant financial damage to his businesses.
Procedural Posture:
- Harvey sued the Ute Tribe, tribal officials, and oil/gas companies in Utah state district court.
- The defendants filed motions to dismiss on various grounds including sovereign immunity and failure to state a claim.
- The district court dismissed the Ute Tribe for lack of subject matter jurisdiction due to sovereign immunity.
- The district court dismissed the tribal officials and other defendants under Rule 12(b)(7) for failure to join the Tribe as an indispensable party.
- The district court dismissed the claims against the oil/gas companies (Newfield, etc.) under Rule 12(b)(6) for failure to state a claim.
- Harvey appealed the district court's dismissals directly to the Supreme Court of Utah.
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Issue:
Does the doctrine of tribal sovereign immunity require the dismissal of claims against tribal officials acting allegedly outside their authority, and does the federal tribal exhaustion doctrine require state courts to stay proceedings until tribal remedies are exhausted?
Opinions:
Majority - Justice Durham
Yes, regarding exhaustion, and mixed regarding immunity. The Court affirmed that the Ute Tribe possesses sovereign immunity which was not waived by filing a motion to dismiss. However, applying federal precedent, the Court held that sovereign immunity does not bar claims against tribal officials in their 'official capacity' when seeking injunctive relief (under the Ex parte Young doctrine), nor does it bar claims against them in their 'individual capacity' for damages (under Lewis v. Clarke). Therefore, the Tribe was not an indispensable party warranting total dismissal. Nevertheless, the Court ruled that the 'tribal exhaustion doctrine' applies to state courts. Because the dispute involves the Tribe's authority to regulate economic activity on its land, the state court must stay its hand and allow the Tribal Court the first opportunity to determine the scope of its own jurisdiction. Finally, claims against the private oil companies (Newfield) were properly dismissed because complying with a government directive does not constitute a conspiracy or tortious interference.
Concurrence - Justice Himonas
Yes, the tribal exhaustion doctrine mandates that state courts abstain from hearing these cases. The Justice wrote separately to elaborate that the Tribe is not a necessary party under Rule 19 because the official-capacity suit against the officers effectively serves as a suit against the sovereign for injunctive purposes. Furthermore, he argued that the tribal exhaustion rule is binding on state courts under the Supremacy Clause because it reflects a federal policy of supporting tribal self-government. He emphasized that exhaustion is required whenever a tribal court has a 'colorable claim' of jurisdiction.
Concurring-in-part-and-dissenting-in-part - Associate Chief Justice Lee
No, the tribal exhaustion doctrine should not compel the state court to stay its hand when no concurrent case is pending in the tribal court. While agreeing with the immunity analysis, Justice Lee dissented regarding exhaustion. He argued that there is no binding U.S. Supreme Court precedent forcing state courts to yield jurisdiction to tribal courts when the parties have chosen the state forum and no party has filed suit in the tribal court. He viewed the majority's application of exhaustion as an unjustified expansion that overrides the parties' choice of forum.
Analysis:
This decision provides a critical clarification of the interplay between state and tribal court jurisdiction. It affirms that while Tribes are immune, their agents are not necessarily immune from individual liability or injunctive relief, aligning Utah law with the U.S. Supreme Court's Lewis v. Clarke decision. Crucially, it establishes that the federal 'tribal exhaustion doctrine' is binding on Utah state courts, not just federal courts. This means state courts must defer to tribal courts to decide jurisdictional questions regarding reservation business regulations first, even if the case is filed in state court. Practically, this forces plaintiffs suing regarding tribal regulatory actions to litigate in tribal court before they can proceed in state court, preserving tribal sovereignty over reservation economic activity.
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