Plains Commerce Bank et al v. Long Family Land and Cattle Co. Inc. et al
Filing
36
OPINION AND ORDER DENYING PLAINTIFFS' 21 Motion for Summary Judgment. Signed by U. S. District Judge Roberto A. Lange on 12/28/12. (DJP)
UNITED STATES DISTRICT COURT
DISTRICT OF SOUTH DAKOTA
CENTRAL DIVISION
PLAINS COMMERCE BANK,
JEROME HAGEMAN, and RANDY
ROBINSON,
Plaintiffs,
vs.
LONG FAMILY LAND AND CATILE
CO., INC., RONNIE LONG, LILA
LONG, and CHEYENNE RIVER
SIOUX TRIBAL COURT,
Defendants.
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CIV 12-3021-RAL
FILED
DEC 28 2012
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OPINION AND ORDER
DENYING PLAINTIFFS'
MOTION FOR
SUMMARY JUDGMENT
This case is a continuation of a dispute that culminated in a decision of the Supreme
Court of the United States in Plains Commerce Bank v. Long Family Land & Cattle Co., 554
U.S. 316 (2008). Approximately four years after the Supreme Court released its opinion in
Plains Commerce Bank, Defendants Long Family Land and Cattle Company, Inc., Ronnie Long,
and Lila Long resumed litigation by filing an action in the Cheyenne River Sioux Tribal Court
against Plaintiffs Plains Commerce Bank, Jerome Hageman, and Randy Robinson. Plaintiffs
responded by starting this federal court action to seek to enjoin the Tribal Court action. This case
and the Plaintiffs' Motion for Summary Judgment present a legal issue: whether this Court
should decide now or defer in the first instance to the Tribal Court to determine the effect ofthe
Supreme Court's decision in Plains Commerce Bank on the underlying Tribal Court judgment.
For the reasons explained in this Opinion and Order, this Court defers decision at this time to the
Tribal Court based on the doctrine oftribal court exhaustion and comity interests. Therefore, this
Court denies Plaintiffs' Motion for Summary Judgment and declines to grant the relief requested
in Plaintiffs' Complaint.
I. Undisputed Material Facts
In ruling on a motion for summary judgment, this Court must take the facts in the light
most favorable to the non-moving party under Rule 56 ofthe Federal Rules ofCivil Procedure.
However, there exists no genuine dispute as to any material fact regarding the legal issues before
this Court. The litigation history between these parties is a matter of public record and not a
matter of disputed fact.
The principal Defendants in this case-Long Family Land and Cattle Company, Inc.,
Ronnie Long, and Lila Long (collectively "the Longs"}-sued the primary Plaintiff in this
case-Plains Commerce Bank-in the Cheyenne River Sioux Tribal Court in July 1999. Plains
Commerce Bank, 554 U.S. at 322. Ronnie and Lila Long are enrolled members ofthe Cheyenne
River Sioux Tribe and operated a ranch within the boundaries ofthe Cheyenne River Sioux Tribe
reservation. rd. at 321. The Longs' claims arose out of a banking relationship that they had with
Plains Commerce Bank, which is a South Dakota bank based outside of the Cheyenne River
Indian Reservation. rd. Because offinancial problems, the Longs had defaulted on certain loans,
deeded over certain land to Plains Commerce Bank while retaining an option to repurchase the
land, and entered into an agreement to lease the land back from Plains Commerce Bank. rd. at
321-22. Due to additional financial stress caused by cattle deaths during a particularly harsh
winter, the Longs were unable to exercise the option to purchase when the lease agreement
expired. rd. at 322. Plains Commerce Bank chose to evict the Longs and sell the land the Longs
previously had owned to non-Indians. rd. The Longs sued the Bank in the Cheyenne River
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Sioux Tribal Court for various claims, including breach ofcontract, bad faith, violation oftriballaw self-help remedies, and discrimination. I Id.
Plains Commerce Bank answered the Tribal Court complaint and unsuccessfully disputed
the jurisdiction of the Tribal Court. Id. After a two-day jury trial in Tribal Court in December
of 2002, a jury returned a verdict finding for the Longs on three of the four claims submitted to
the jury and awarded $750,000.00 on a general verdict form. Id. at 323; Doc. 25-7 at 4. The
Tribal Court denied the Bank's post-trial motion for judgment notwithstanding the verdict and
entered judgment for the Longs in the amount of $750,000.00, plus interest. Id. The Tribal
Court later entered a supplemental judgment awarding the Longs an option to purchase the land
that Plains Commerce Bank had sold to non-Indians. Id.
Plains Commerce Bank appealed to the Cheyenne River Sioux Tribal Court of Appeals
raising various issues, including a single jurisdictional issue: "The Cheyenne River Sioux Tribal
Court lacked subject matter jurisdiction for a claim of discrimination against a non-tribal
member, offreservation Bank which claim was presented to the jury. Such discrimination action
tainted the entire trial," Doc. 25-5. Plains Commerce Bank later framed the issue before the
Tribal Court of Appeals as: "Does the Cheyenne River Sioux Tribal Court lack jurisdiction for
a claim of discrimination against an off-reservation bank." Doc. 25-6. Plains Commerce Bank
did not appeal to the Tribal Court of Appeals the questions of jurisdiction over the breach of
contract and contractual bad faith claims. See Doc. 27. To appeal to the Tribal Court of
1 The Longs raised other claims, which the Tribal Court judge dismissed, including claims
of a void contract, fraud, failure of consideration, and unconscionability. Doc. 25-7 at 4.
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Appeals, Plains Commerce Bank as principal and Plaintiffs Jerome Hageman and Randy
Robinson as sureties, executed an appeal bond in the amount of $875,922.46 for the judgment
amount and interest. Doc. 23; Doc. 27. The Tribal Court of Appeals in November of 2004
upheld the judgment. Doc. 25-7.
Plains Commerce Bank then sued the Longs in federal district court challenging tribal
jurisdiction over the discrimination claim. 2 Plains Commerce Bank v. Long Family Land &
Cattle Co., Inc., CIV 05-3002-CBK. In Plains Commerce Bank v. Long Family Land & Cattle
Co., Inc., 440 F. Supp. 2d 1070 (D.S.D. 2006), the Honorable Charles B. Kornmann on cross
motions for summary judgment determined that tribal jurisdiction existed over the Longs'
discrimination claim based on the first exception set forth in Montana v. United States, 450 U.S.
554 (1981), which allows a tribe to "regulate, through taxation, licensing, or other means, the
activities of nonmembers who enter consensual relationships with the tribe or its members,
through commercial dealing, contracts, leases, or other arrangements." Id. at 565; see also Strate
v. A-I Contractors, 520 U.S. 438, 453 (1997) (noting Tribal Court jurisdiction is co-extensive
to the regulatory authority ofthe tribe under Montana). The United States Court ofAppeals for
the Eighth Circuit affirmed Judge Kornmann's decision. Plains Commerce Bank v. Long Family
Land & Cattle Co .. Inc., 491 F.3d 878, 886 (8th Cir. 2007).
As the Eighth Circuit put it, Plains Commerce Bank's claim in federal district court was
"seeking a declaration that the tribal judgment was null and void and not entitled to recognition
because the tribal court lacked jurisdiction over the Longs' discrimination claim and because the
proceedings violated due process." Plains Commerce Bank v. Long Family Land & Cattle Co.,
Inc.,491 F.3d 878, 883 (8th Cir. 2007).
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Plains Commerce Bank then filed a petition for writ of certiorari, which the Supreme
Court granted. The Supreme Court framed the sole issue before it as "whether the Tribal Court
had jurisdiction to adjudicate a discrimination claim concerning the non-Indian bank's sale offee
land it owned." Plains Commerce Bank, 554 U.S. at 320. The Supreme Court reversed the
Eighth Circuit's decision and held that the Tribal Court did not have jurisdiction over the
discrimination claim. Id. All nine justices agreed that the Tribal Court did not have jurisdiction
to give Ronnie and Lila Long an option to repurchase land that Plains Commerce Bank had
contracted to sell to non-Indians. See id. at 342 (Ginsburg, J., dissenting). The Supreme Court
justices split five-to-four on other matters.
In May 2012, nearly four years after the Supreme Court decision in Plains Commerce
Bank, the Longs filed another action in the Cheyenne River Sioux Tribal Court. Doc. 1-1. The
Longs sued all three of the Plaintiffs in this case--Plains Commerce Bank, Jerome Hageman,
and Randy Robinson-to seek to collect on the appeal bond executed by those parties in May
2003 as a part ofthe Bank's appeal to the Cheyenne River Sioux Tribal Court ofAppeals. Doc.
1-1. The Longs' current Tribal Court complaint asserts that, because Plains Commerce Bank did
not appeal from the jury's finding for the Longs on claims for breach of contract and contractual
bad faith, the Bank still owes the entire amount that the jury awarded, plus interest, and that the
Plaintiffs should pay under the appeal bond. Doc. 1-1.
Plains Commerce Bank, Hageman, and Robinson filed this action seeking a declaratory
judgment that the Tribal Court has no jurisdiction over the new Tribal Court case and seeking
preliminary and permanent injunctive relief to prevent the Tribal Court from proceeding. Doc.
1. These Plaintiffs named not only the Longs, but also the Cheyenne River Sioux Tribal Court
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as Defendants. Doc. 1. The Plaintiffs then filed a motion for summary judgment, Doc. 21,
which the Defendants resist. Doc. 26.
II. Legal Analysis
The primary issue in this case presently is whether this Court should enjoin the Tribal
Court case and decide the effect of the Supreme Court decision on the Tribal Court judgment or
defer to the Tribal Court to do so in the first instance. Plains Commerce Bank invokes federal
question jurisdiction under 28 U.S.C. § 1331. The issue ofwhether a tribal court has jurisdiction
over nonmembers is a federal question. Plains Commerce Bank, 554 U.S. at 324. However,
"even where a federal question exists, due to considerations of comity, federal court jurisdiction
does not properly arise until available remedies in the tribal court system have been exhausted."
Auto-Owners Ins. Co. v. Tribal Court of Spirit Lake Indian Reservation, 495 F.3d 1017, 1021
(8th Cir. 2007). Thus, this Court must determine whether "available remedies in the tribal court
system" should be exhausted. See id.
Congress has "consistently encouraged" the development of tribal courts as part of its
effort to foster tribal self-government. IowaMut. Ins. Co. v. LaPlante, 480 U.S. 9, 14-15 (1987);
Nat'l Farmers Union Ins. Cos. v. Crow Tribe ofIndians , 471 U.S. 845, 856 (1985). Indeference
to this commitment, the Supreme Court and in turn the Eighth Circuit have required exhaustion
of tribal court remedies in matters related to reservation affairs. Iowa Mut. Ins. Co., 480 U.S.
at 16 ("[T]he federal policy supporting tribal self-government directs a federal court to stay its
hand in order to give the tribal court a full opportunity to determine its own jurisdiction.")
(citation and internal quotation marks omitted); Bruce H. Lien Co. v. Three Affiliated Tribes,
93 F.3d 1412, 1420 (8th Cir. 1996) ("Supreme Court precedent and this court's pronouncements
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based thereon require exhaustion of tribal court remedies in matters related to reservation
affairs.") (citation omitted). By requiring parties to exhaust their tribal court remedies before
seeking relief in federal court, this "tribal-court exhaustion doctrine," allows tribal courts to
assert authority over reservation affairs without having to compete against federal courts for the
rightto do so. See E1 Paso Natural Gas Co. v. Neztsosie, 526 U.S. 473, 476, 478 (1999)(referring
to this rule as the "doctrine of tribal-court exhaustion" or the "tribal-court exhaustion doctrine");
Iowa Mut. Ins. Co., 480 U.S. at 16 (H[U]nconditional access to the federal forum would place
[federal courts] in direct competition with the tribal courts, thereby impairing the latter's
authority over reservation affairs."); Duncan Energy Co. v. Three Affiliated Tribes, 27 F.3d
1294, 1299 (8th Cir. 1994) (HBecause a federal court's exercise of jurisdiction over matters
relating to reservation affairs can impair the authority of tribal courts ... the examination of
tribal sovereignty and jurisdiction should be conducted in the first instance by the tribal court
itself.") (citing Nat'l Farmers, 471 U.S. at 856). The tribal-court exhaustion doctrine is a comity
based rule arising out of a mutual respect between two sovereigns, rather than a jurisdictional
prerequisite. See Iowa Mut. Ins. Co., 480 U.S. at 16 n.8 ("Exhaustion is required as a matter of
comity, not as a jurisdictional prerequisite."); Smith v. Moffett, 947 F.2d 442, 445 (1Oth Cir.
1991). In addition to promoting tribal self-government and self-determination, the tribal-court
exhaustion doctrine encourages the "orderly administration of justice" and provides federal
courts with the unique expertise oftribal courts in matters relating to the tribal court jurisdiction
of their particular tribal court. Nat'l Farmers, 471 U.S. at 856.
The tribal-court exhaustion doctrine is not absolute, however. Tribal court exhaustion
is unnecessary where:
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(1) an assertion of tribal jurisdiction is motivated by a desire to
harass or is conducted in bad faith; (2) the action is patently
violative of express jurisdictional prohibitions; or (3) exhaustion
would be futile because ofthe lack of an adequate opportunity to
challenge the court's jurisdiction.
BruceH. Lien, 93 F.3d at 1420 n.14 (citing Nat'l Fanners, 471 U.S. at 856 n.21). Plaintiffs argue
that Tribal Court exhaustion should not be required because, they argue, the Longs' current Tribal
Court action is motivated by a desire to harass or is conducted in bad faith and is patently
violative of express jurisdictional prohibitions. Doc. 22 at 7. Plaintiffs make this argument
based on their reading ofthe Supreme Court decision in Plains Commerce Bank as nullifying the
general verdict award of $750,000.00. Doc. 22 at 7; Doc. 29 at 4-5.
In Plains Commerce Bank, the issue before the Supreme Court was whether the Tribal
Court had jurisdiction over the discrimination claim. 554 U.S. at 320. However, the Supreme
Court addressed the validity of the entire Tribal Court judgment because the Longs raised an
issue of the Bank's standing. Id. at 324-27. That is, the Longs argued that, even if the Supreme
Court were to detennine that the Tribal Court lacked jurisdiction over the discrimination claim,
the jury's damage award should remain based on the remaining claims. Id. at 324-25. The
Supreme Court was "not persuaded" by the Longs' argument that the jury's damage award was
premised entirely on claims other than the discrimination claim. Id. at 325. Rather, the Supreme
Court reasoned, the general verdict on damages and the verdict fonn used "establish that the jury
could have based its damages award, in whole or in part, on the finding of discrimination." Id.
The Supreme Court anticipated that the consequences of its decision could include "vacatur of
the general damages award, vacatur of the option to purchase, [and] a new trial on the other
claims." Id. at 327. The Longs' newly·filed Tribal Court action thus appears to pursue a
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position-that the money judgment in Tribal Court should remain valid-accepted by the
dissenting justices but at odds with the majority opinion. See id. at 342 (Ginsburg, J., dissenting)
("I dissent from the Court's decision, however, to the extent that it overturns the Tribal Court's
principal judgment awarding the Longs damages in the amount of $750,000 plus interest.").
The Longs, however, do not base their contention that the Tribal Court judgment is still
valid on some different interpretation ofthe Supreme Court decision in Plains Commerce Bank:.
Instead, the Longs point to the open question of which approach the Cheyenne River Sioux
Tribal Court would adopt on whether a jury's general damage verdict based on multiple claims,
one of which has been found invalid, may be upheld. Federal courts, based on a series of
Supreme Court cases, generally hold that a jury's general verdict awarding damages will be
upheld only when there is substantial evidence to support each theory of liability submitted to
the jury. See Sunkist Growers. Inc. v. Winckler & Smith Citrus Prods. Co., 370 U.S. 19, 30
(1962); United New York & New Jersey Sandy Hook Pilots Ass'n v. Halecki, 358 U.S. 613, 618
19 (1959); Wilmington Star Mining Co. v. Fulton, 205 U.S. 60 (1907); Maryland v. Baldwin,
112 U.S. 490, 494-95 (1884). In short, in a federal court, if one of the theories that supported
a general damages verdict was inappropriately submitted to the jury, then the general verdict
typically cannot stand. Sunkist Growers Inc., 370 U.S. at 30; AIG Global Sec. Lending Corp.
v. Bane of Am. Sec.. LLC, 386 F. App'x 5, 7 (2d Cir. 2010) ("[W]hen alternative theories for
imposing liability are given to the jury, but one ofthose theories should not have been submitted
... the usual course is to reverse ... and order a new trial .... "); Barber v. Whirlpool Corp.,
34 F.3d 1268, 1278 (4th Cir. 1994) (holding that in the Fourth Circuit "a general verdict may not
stand" if one of the two underlying claims is reversed); Friedman & Friedman, Ltd. v. Tim
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McCandless, Inc., 606 F.3d 494,502 (8th Cir. 2010) ("'The rule in this circuit is clear that when
one oftwo theories has erroneously been submitted to the jury, a general verdict cannot stand. ''')
(quoting Dudleyv. Dittmer, 795 F .2d 669,673 (8th Cir. 1986)); Kern v. Levolor Lorentzen, Inc.,
899 F.2d 772, 790 (9th Cir. 1990) ("More than a century ago, the Supreme Court explained that,
because we cannot read the minds ofjurors, a general verdict that may have been based on an
improper theory of liability must be reversed. "). Although there is some confusion in the
authority as to what to call this rule, one federal court of appeals has labeled it "the general
verdict rule." AIG Global, 386 F.App'x 5 at 7; see also 3 Fed. Jury Prac. & Instr. § 106:01 (6th
ed.) (referring to this rule as the "general verdict rule"); but see Martinmaas v. Engelmann, 612
N.W.2d 600,615 (S.D. 2000) (Konenkamp, J., concurring) (calling the federal rule the "two
issue rule"). The underlying rationale for the approach followed in federal court is that a court
cannot plumb the minds of jurors to know whether a general verdict was based in whole or in
part on an improperly submitted theory of liability, and thus such a general verdict should be
reversed and a new trial then held. See Friedman & Friedman, 606 F .3d at 502; Dudley, 795
F.2d at 673. Many states have adopted the approach followed in federal court. See e.g., Prince
George's Cnty.. Maryland v. Longtin, 988 A.2d 20,34 n.33 (Md. Ct. Spec. App. 2010); Gonyea
v. Duluth, Missabe & Iron Range Ry. Co., 19 N.W.2d 384, 389 (Minn. 1945); Martin v. N. Pac.
Ry. Co., 149 P. 89, 91 (Mont. 1915); Heinen v. Heinen, 186 P.2d 770, 777-78 (Nev. 1947); Great
Lakes Aircraft Co .. Inc. v. City of Claremont, 608 A.2d 840, 846-47 (N.H. 1992) (accepting the
approach followed in federal court but "only for purposes ofthis appeal "); Maccia v. Tynes, 120
A.2d 263, 268 (NJ. Super. Ct. App. Div. 1956) ("The weight of authority ... hold[s] that there
must be a reversal even if the error infects only one ofthe issues."); Salinas v. John Deere Co ..
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Inc., 707 P.2d 27, 32 (N.M. Ct. App. 1984); Stewart v. Newbury, 115 N.E. 984, 985 (N.Y.
1917); Barta v. Hondl, 118 N.W.2d 732,736 (N.D. 1962); Bredouw v. Jones, 431 P.2d413, 420
21 (Ok. 1966); Halev. MaerskLine Ltd., 732 S.E.2d 8, 19 (Va. 2012); Davis v. Microsoft Corp.,
70 P.3d 126, 135 (Wash. 2003) (en banc); Fife v. State, 676 P.2d 565, 568 (Wyo. 1984) (citing
Sunkist Growers Inc., 370 U.S. 19, and Baldwin, 112 U.S. 490, but applying the rule in the
criminal context).
However, some states choose not to follow the federal court approach and instead allow
a general verdict to stand even when one of the causes was erroneously submitted to the jury.
See e.g., McCloud v. Roy Riegels Chems., 97 Cal. Rptr. 910, 915 (Cal. Ct. App. 1971); Spears v.
Elder, 5 A.3d 500, 503-04 (Conn. 2010); Grenitz v. Tomlian, 858 So. 2d 999, 1006-07 (Fla. 2003);
Elam v. Lincoln Elec. Co., 841 N.E.2d 1037, 1043 (Ill. App. Ct. 2005); Lahm v. Burlington N.
R.R. Co., 571 N.W.2d 126, 131 (Neb. Ct. App. 1997); Cent. Ohio Joint Vocational Sch. Dist.
Bd. of Edn. v. Peterson Constr. Co., 716 N.E.2d 1210, 1214 (Ohio Ct. App. 1998); Shoup v.
Wal-Mart Stores, Inc., 61 P.3d 928,935 (Or. 2003); Todd v. S. Carolina Farm Bureau Mut. Ins.
Co., 336 S.E.2d 472, 473-74 (S.C. 1985); Martinmaas v. Engelmann, 612 N.W.2d at 615
(Konenkamp, J., concurring); In re Estate of Gower, No. 0IAOl-971O-CH-00605, 1998 WL
34190566, at *3-4 (Tenn. Ct. App. July 1,1998); Lyon v. Burton, 5 P.3d 616, 623 (Utah 2000);
Orrv. Crowder, 315 S.E.2d 593, 608(W. Va. 1983). Under this alternative approach, sometimes
called the "two issue" rule/ "when the jury returns a general verdict involving two or more issues
There is confusion regarding the proper name of this rule that is applied in these states. Some
sources refer to this state law rule as the "two issue rule." See e.g., Todd, 336 S.E.2d at 473-74
(referring to the rule as the "'two issue' rule"); Grenitz, 858 So. 2d at 1007 (referring to the rule as
the "two issue rule"). Other sources refer to this same rule as the "general verdict rule." See e.g.,
Spears, 5 A.3d at 503-04 (referring to the rule as the "general verdict rule n ); Skender v.
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and its verdict is supported as to at least one issue, the verdict will not be reversed on appeal."
Todd, 336 S.E.2d at 473-74. The underlying rationale behind this approach that rejects the
prevailing federal rule is the assumption that, when a verdict is sustainable on more than one
theory, the general verdict may be supported by the theory unaffected by error, which in tum
simplifies the work oftrial courts and limits the range of errors presented to the appellate court.
Lahm, 571 N.W.2d at 131. Among the jurisdictions that follow this alternative approach is
South Dakota. Limmerv. Westegaard, 251 N.W.2d 676, 679 (S.D. 1977); Eberlev. Siouxland
Packing Co., Inc., 266 N.W.2d 256, 258 (S.D. 1978); Martinmaas, 612 N.W.2d at 615 (S.D.
2000) (Konenkamp, J., concurring) (noting that "South Dakota belongs to a minority of
jurisdictions" following the rule that "when a jury returns a general verdict encompassing two
or more issues and the verdict is supported by at least one issue, the case will not be reversed. ")
This alternative "two issue" approach seems best suited for instances where the error in
submission ofone claim to a jury was harmless error that would not have affected ajury's general
damage award and not for instances where the minds ofthe jurors would need to be plumbed to
determine whether a general damage award would have been the same. Indeed, some federal
courts have recognized a "harmless error exception" to the federal general verdict rule, upholding
a general verdict even if one of its underlying claims was improperly submitted if the error was
Brunsonbuilt Const. & Dev. Co .. LLC, 148 P.3d 710, 716 (Nev. 2006) (referring to the rule as the
"general verdict rule"). Still others refer to this rule as both the "general verdict rule" and the "two
issue rule." Lahm, 571 N.W.2d at 131 (calling the rule applied in the state both the "general
verdict" rule and the "two issue" rule); Prince George's Cnty. Maryland v. Longtin, 988 A.2d at 35
n.33 (noting that the "general verdict rule" and the "two issue rule" both refer to the same doctrine);
5 C,J.S. Appeal and Error § 904 (discussing the general verdict rule and the two issue rule in the
same supplement). For the sake of clarity, this Opinion and Order will refer to the rule applied in
federal courts as the "federal general verdict rule" and the rule applied in certain states as the "two
issue rule."
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harmless. Ryan Patrick Phair, Appellate Review ofMulti-Claim General Verdicts: The Life and
Premature Death of the Baldwin Principle, 4 J. App. Prac. & Process 89, III (2002).
The
Eighth Circuit, for example, has held that a new trial is not required every time one claim in a
multi-claim scenario is improperly submitted and the jury returns a general verdict and global
damage award. See e.g., Ondrisek v. Hoffman, 698 F.3d 1020, 1026-27 (8th Cir. 2012). If "one
of alternative theories of liability fully sustains the damages awarded, the award should stand
despite the erroneous submission of another theory, where the damages are the same under a
properly submitted theory." Id. (upholding a global damage award after reversing one ofthree
theories of liability because the defendant was found liable under all three theories, liability
under each theory would result in the same damage figure, and, thus, the "error did not affect the
parties' substantial rights or the trial's probable outcome"). A new trial is also not necessary
when a general verdict is rendered based on a submission oftwo claims to the jury--one proper
and one improper-ifthe appellate court is "fairly convinced that the jury proceeded only on the
sound ground." Muellerv. Hubbard Milling Co., 573 F.2d 1029,1039 (8th Cir. 1978). Butthis
harmless error exception has "very rarely has been applied to uphold a general verdict." Phair,
Appellate Review, supra, at Ill. A retrial is required where a jury returns a global damage
award supported by two or more theories or claims that permit different damage amounts, and
one of those theories or claims is upset on appeal. See Friedman, 606 F.3d at 502 (requiring a
new trial when the jury found the defendant liable under two separate counts, returned a global
compensatory damage award, and one ofthe claims was upset on appeal because the court had
no way of knowing whether the jury awarded some portion of the award for the properly
submitted claim and some portion for the improperly submitted claim). The Longs made an
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argument very similar to a "harmless error" assertion to the Supreme Court that the jury verdict
on damages should stand because it was based on the remaining contract-based claims, but a
majority of the justices were "not persuaded." Plains Commerce Bank, 554 U.S. at 324-25. 4
Indeed, the situation here is more akin to the Freidman case than to the Ondrisek or Mueller
cases, in that the common law discrimination claim submitted to the jury was a distinct theory
ofliability, which may have supported a different damage award than the contract based claims.
The Supreme Court had the federal general verdict rule in mind when it reasoned that the
general verdict in the Tribal Court on damages suggested "that the jury could have based its
damages award, in whole or in part, on the finding of discrimination." Plains Commerce Bank,
554 U.S. at 325. The Supreme Court likewise anticipated that the federal general verdict rule
would be applied when it anticipated that future proceedings could include "vacatur of the
general damages award, vacatur ofthe option to purchase, [and] a new trial on the other claims."
Four other states appear conflicted about whether to apply the approach followed in federal
courts, or the approach followed in certain states sometimes called the two issue rule. Compare
Auto. Accc:,mtance Corp. v. Powell, 234 So. 2d 593, 600 (Ala. Civ. App. 1970) (applying the
alternative approach sometimes called the two issue rule), with John Deere Indus. Equip. Co. v.
Keller, 431 So. 2d 1155, 1157 (Ala. 1983) ("We cannot presume that the general jury verdict
relates to one ofthe counts which the evidence did support, where it is equally possible that it is
based on the count which is unsupported by the evidence."); compare State ex reI. Corbin v.
United Energy Corp. of Am., 725 P.2d 752, 759 (Ariz. Ct. App. 1986) (applying the alternative
approach sometimes called the two issue rule), with S. Cas. Co. v. Hughes, 263 P. 584,588
(Ariz. 1928) (applying the approach followed in federal court); compare Ledee v. Devoe, 549
S.E.2d 167, 173 (Ga. Ct. App. 2001) (applying the alternative approach sometimes called the
two issue rule), with Taylor v. Austin, 88 S.E.2d 190, 192 (Ga. Ct. App. 1955) (applying the
approach followed in federal court); compare Corpus Christi Day Cruise. LLC v. Christus Spohn
Health Sys. Corp., No. 13-11-00117,2012 WL 2605066, at *6 (Tex. Ct. App. July 5,2012)
(applying the alternative approach sometimes called the two issue rule), with Tisdale v.
Panhandle & S.F. Ry. Co., 228 S.W. 133, 137 (Tex. Comm'n App. 1921) (applying the approach
followed in federal court).
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See id. at 327. Indeed, even the dissenting opinion anticipated that the effect ofthe Supreme
Court decision would be overturning the $750,000.00 judgment. Id. at 342 (Ginsburg, J.,
dissenting) ("I dissent from the Court's decision, however, to the extent that it overturns the
Tribal Court's principle judgment awarding the Longs damages in the amount of$750,000 plus
interest.").
Yet, the ultimate ruling ofthe Supreme Court was to reverse the judgment ofthe Eighth
Circuit. Id. at 342. The single issue before the Supreme Court was whether the Tribal Court
lacked jurisdiction over the discrimination claim. Id. at 320. Indeed, that was the only issue
framed by the initial federal court filing in 2005. See Plains Commerce Bank, 491 F.3d at 883.
The Supreme Court concluded that Plains Commerce Bank had standing as the Court was "not
persuaded" that the damage award was unconnected to the discrimination claim, but did not
specifically direct what would occur upon remand. Plains Commerce Bank, 554 U.S. at 325.
Under the circumstances, this Court cannot characterize the action in Tribal Court that seeks to
enforce the $750,000.00 judgment based on a theory that the Tribal Court should adopt the
alternative "two issue" approach followed by certain states to constitute "an assertion of tribal
jurisdiction ... motivated by a desire to harass or ... conducted in bad faith." See Bruce H.
Lien, 93 F.3d at 1420 n.14 (citing Nat'l Farmers, 471 U.S. at 856 n.21).
Plaintiffs also argue that the Longs' current Tribal Court case is patently violative of
express jurisdictional prohibitions. This exception to the tribal-court exhaustion doctrine "refers
to specific prohibitions on designated tribal remedies or to prohibitions on a tribal forum's
assertion ofjurisdiction over a dispute." Reservation Tel. Coop. v. Three Affiliated Tribes, 76
F.3d 181, 185 (8th Cir. 1996). "A substantial showing must be made by the party seeking to
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invoke [the express jurisdictional prohibition] exception to the tribal exhaustion rule." Kerr
McGeeCotp. v.Farley, 115F.3d 1498, 1502 (lOthCir. 1997). Indeed, "tribal courts rarely lose
the first opportunity to determine jurisdiction because ofan 'express jurisdictional prohibition. II,
Id. The majority of cases applying the "express jurisdictional prohibition" exception involve
statutes that grant the federal government exclusive jurisdiction. See N. States Power Co. v.
Prairie Island Mdewakanton Sioux Indian Cmty., 991 F.2d 458,463 (8th Cir. 1993) (holding
exhaustion of tribal court remedies unnecessary in case concerning tribal ordinances regulating
nuclear materials because Hazardous Materials Transportation Act preempted tribal ordinances);
Blue Legs v. United States Bureau ofIndian Affairs, 867 F.2d 1094, 1097-98 (8th Cir. 1989)
(holding plaintiffs bringing suit in federal court against tribe under the federal Resource
Conservation and Recovery Act (RCRA) did not need to exhaust tribal remedies because RCRA
placed exclusive jurisdiction for suits brought under the RCRA in federal courts); Deborah F.
Buckman, Annotation, Construction and Application ofFederal Tribal Exhaustion Doctrine, 186
A.L.R. Fed. 71 § 11 (2003).
The Supreme Court in Plains Commerce Bank appeared to contemplate that the
$750,000.00 general verdict would be vacated and that a new trial on damages would occur
based on the jury findings of breach of contract and breach of contractual good faith. See 554
U.s. at 327. However, there is nothing in the Supreme Court's decision that provides an express
jurisdictional prohibition to further Tribal Court proceedings, and indeed the new trial on
damages foreseen as a possibility by the Supreme Court presumably would take place in Tribal
Court. Id. There is no applicable statute granting exclusive federal jurisdiction here. The first
exception recognized in the Montana case, concerning "activities of nonmembers who enter
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consensual relationships with the tribe or its members," 450 U.S. at 565, would appear to apply
to a situation where the Bank and two individuals as sureties execute and file an appellate bond
in tribal court in order to appeal a tribal court ruling to an appellate tribal court. See Strate, 520
U.S. at 453 (noting tribal court jurisdiction is co-extensive to the regulatory authority ofthe tribe
under Montana). In short, there is nothing about the presently pending Tribal Court case seeking
to execute on a Tribal Court bond that triggers an express jurisdictional prohibition of a Tribal
Court proceeding. The Tribal Court of course cannot, and this Court anticipates will not, ignore
the Supreme Court decision in Plains Commerce Bank, 554 U.S. 316.
Finally, one of the Defendants-Cheyenne River Sioux Tribal Court-is a quasi
sovereign entity with protection of partial sovereign immunity. See Fox Drywall & Plastering
Co., Inc. v. Sioux Falls Const. Co., No. 12-4026,2012 WL 1457183, at *9 n.4 (D.S.D. April 26,
2012) (explaining that tribal sovereign immunity extends to tribal court s acting within the scope
oftheir authority). Such tribal sovereign immunity, however, is "subject to the well-established
exception" outlined in Ex Parte Young, 209 U.S. 123, 159-60 (1908). Baker Elec. Co-op, Inc.
v. Chaske, 28 F.3d 1466, 1471 (8th Cir. 1994). Thus, if the tribal court acts beyond the scope
of its authority, the tribal court is not entitled to tribal sovereign immunity. See N. States Power
Co., 991 F.2d at 460. Because the Tribal Court has jurisdiction, in the first instance, to
determine whether the Tribal Court judgment and thus the appellate bond has any validity in the
wake ofthe Supreme Court's decision in Plains Commerce Bank, the Tribal Court is not acting
beyond the scope of its authority in considering that issue and is entitled to tribal sovereign
immunity at this juncture of the proceedings.
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The denial ofPlaintiffs' Motion for Summary Judgment and the analysis in this Opinion
and Order makes the relief requested in Plaintiffs' Complaint-a declaratory judgment that the
Tribal Court lacks jurisdiction over the underlying case and enjoining the Tribal Court
action-inappropriate to enter. Defendants have not filed a motion for summary judgment,
however. If the Tribal Court somehow were to determine that, notwithstanding the apparent
contemplation ofthe Supreme Court, the alternative "two issue" rule as followed by certain states
including South Dakota applies, this Court could foresee an action similar to this one being
started anew. If, however, the Tribal Court follows the approach followed in federal court and
many states as apparently contemplated by the Supreme Court, and thereafter conducts a new
jury trial on the damages to which the Longs are entitled on the breach of contract and
contractual bad faith claims, then there may be no further proceedings in this Court. At this time,
it appears appropriate to enter judgment of dismissal in favor of the Defendants without
prejudice to re-filing a subsequent action depending on the ruling ofthe Tribal Court. This Court
will allow each ofthe parties twenty-one (21) days from filing ofthe Opinion and Order to notify
this Court oftheir respective positions with regard to whether judgment ofdismissal should now
enter and to brief that issue, if they so choose.
tL
Dated December ~S, 2012.
BY THE COURT:
ROBERTO A. LANG
UNITED STATES DISTRICT JUDGE
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