Restatement of the Law, the Law of American Indians

The following entry contains the Black Letter and Comments of Tentative Draft No. 3, Section 58. Tribal Economic Enterprises.

The full draft contains Reporters’ Notes. This draft will be presented to membership at the 2019 Annual Meeting for approval. Until approved, this is not the position of The American Law Institute and should not be represented as such.

§ 58. Tribal Economic Enterprises

             An Indian tribe may engage in economic enterprises within Indian country and outside of Indian country:

                        (a) as the tribe itself;

                        (b) through an unincorporated subdivision, agency, or instrumentality of the tribe;

                        (c) through a corporation chartered pursuant to federal law under Section 17 of the Indian Reorganization Act, 25 U.S.C. § 477, or under 25 U.S.C. § 503 of the Oklahoma Indian Welfare Act;

                        (d) through a corporation or other business association established pursuant to tribal law; or

                        (e) through a corporation or other business association established pursuant to state law.

Comment:

          a. Indian tribes and their unincorporated subdivisions, agencies, and instrumentalities. Indian tribes engage in economic activities within and outside of Indian country in their own capacity and through subdivisions, agencies, or instrumentalities over which their tribal governments maintain ownership and control. Indian tribes and their subdivisions, agencies, and instrumentalities have sovereign immunity from suit for actions to enforce economic obligations unless certain conditions are met. See § 59. Under certain circumstances, state courts will have subject-matter jurisdiction over actions to enforce economic obligations entered into by Indian tribes or their unincorporated subdivisions, agencies, or instrumentalities. See § 63. Unless the conditions for diversity or federal-question jurisdiction are met, federal courts generally lack subject-matter jurisdiction to enforce such obligations. See §§ 64-65. Tribal courts or other tribal adjudicatory forums generally have subject-matter jurisdiction over actions to enforce economic obligations entered into by Indian tribes or their subdivisions, agencies, or instrumentalities arising within Indian country. See §§ 32-36. See also § 69 (application of tribal law absent waiver).

          b. Federally chartered corporations. Indian tribes engage in economic activities within and outside of Indian country through federally chartered corporations pursuant to Section 17 of the Indian Reorganization Act (the “IRA”), 25 U.S.C. § 477, and pursuant to 25 U.S.C. § 503, a provision of the Oklahoma Indian Welfare Act (collectively, “IRA Section 17 corporations”). See § 60. Absent an authorized waiver, IRA Section 17 corporations have sovereign immunity from suit. See id. Under certain circumstances, state courts will have subject-matter jurisdiction over actions to enforce economic obligations entered into by IRA Section 17 corporations. See § 63. Where the conditions for diversity of citizenship are met, federal courts have subject-matter jurisdiction pursuant to 28 U.S.C. § 1332 to enforce economic obligations entered into by IRA Section 17 corporations. See § 65. Tribal courts or other tribal adjudicatory forums generally have subject-matter jurisdiction over actions to enforce economic obligations entered into by IRA Section 17 corporations arising within Indian country. See §§ 32-36. See also § 69 (application of tribal law absent waiver).

          c. Tribal corporations and other business associations. Indian tribes may establish corporations or other business associations pursuant to tribal law to engage in economic activities within and outside of Indian country. If certain conditions are met, such tribal corporations and other business associations will have sovereign immunity from suit for actions to enforce economic obligations. See § 61. Under certain circumstances, state courts will have subject-matter jurisdiction over actions to enforce economic obligations entered into by corporations or business associations formed by Indian tribes pursuant to tribal law. See § 63. Where the conditions for diversity of citizenship are met, federal courts have subject-matter jurisdiction pursuant to 28 U.S.C. § 1332 to enforce economic obligations entered into by corporations or other business associations formed by Indian tribes under tribal law. See § 65. Tribal courts or other tribal adjudicatory forums generally have subject-matter jurisdiction over actions to enforce economic obligations entered into by tribal corporations or business associations arising within Indian country. See §§ 32-36. See also § 69 (application of tribal law absent waiver).

          d. State corporations and other business associations. Indian tribes may establish corporations or other business associations under state law to engage in economic activities within and outside of Indian country. Such state corporations or business associations generally will not have sovereign immunity from suit unless certain conditions are met. See § 62. Under certain circumstances, state courts will have subject-matter jurisdiction over actions to enforce economic obligations entered into by corporations or business associations formed by Indian tribes pursuant to state law. See § 63. Where the conditions for diversity of citizenship are met, federal courts have subject-matter jurisdiction pursuant to 28 U.S.C. § 1332 to enforce economic obligations entered into by corporations or other business associations formed by Indian tribes pursuant to state law. See § 65. Tribal courts or other tribal adjudicatory forums generally have subject-matter jurisdiction over actions to enforce economic obligations entered into by state corporations or business associations arising within Indian country. See §§ 32-36. See also § 69 (application of tribal law absent waiver).

Matthew L.M. Fletcher

Reporter, American Indian Law Restatement

Matthew L.M. Fletcher is a Professor of Law and Director of the Indigenous Law and Policy Center at Michigan State University College of Law. He is a member of the Grand Traverse Band of Ottawa and Chippewa Indians.  He sits as the Chief Justice of the Poarch Band of Creek Indians Supreme Court and also sits as an appellate judge for the Grand Traverse Band, the Hoopa Valley Tribe, the Lower Elwha Tribe, the Nottawaseppi Huron Band of Potawatomi Indians, the Pokagon Band of Potawatomi Indians, and the Santee Sioux Tribe of Nebraska.

Wenona T. Singel

Associate Reporter, American Indian Law Restatement

Wenona T. Singel is an Associate Professor of Law at Michigan State University College of Law and the Associate Director of the Indigenous Law & Policy Center; she is currently on leave to work as deputy legal counsel to Michigan Governor Gretchen Whitmer. She teaches courses in the fields of federal Indian law and natural resources law, and her research and publications address the development of tribal legal systems and tribal accountability for human rights.

Kaighn Smith, Jr.

Associate Reporter, American Indian Law Restatement

Kaighn Smith, Jr., leads Drummond Woodsum’s nationwide Indian Law Practice Group. He has represented Indian nations and their enterprises for more than 25 years in cases that focus on jurisdiction and sovereignty disputes, labor and employment relations, complex transactional disputes, environmental matters, and fishing and water rights.

Jennifer Morinigo

The American Law Institute

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