In Oklahoma at least one Indian tribe owns a rural water district. And several other Indian tribes may seek to expand water service in their tribal lands or get into the business. In Freemanville Water Systems v. Poarch Band of Creek Indians, et al., (07-CV-688) the U.S. District Court for the Southern District of Alabama held that Indian tribes are immune to claims brought under 7 U.S.C. § 1926(b). Section 1926(b) provides monopoly protection for rural water districts’ territories, if the rural water district is indebted to the federal government. There are exceptions, and overlaps, and uncertainty as to where rural water districts are often physically able to supply water, resulting in a large amount of litigation over the past thirty years, which shows no signs of abating.
In the Freemanville case, the Tribe intended to develop its own water system on and off of tribal lands in the same territory presently served by the rural water district. There was no question, on the motion to dismiss phase that Freemanville Water was entitled to monopoly protection. And the monopoly protection emanates from a federal statute of general applicability. However, the Court quoted the U.S. Supreme Court, in that there is a difference between a law’s application and the ability to enforce the law through the Courts. And there is. Just because a law exists does not mean there is a corresponding legal remedy. And that is the situation with 1926(b), as Congress in the Rural Development Act has not waived tribal sovereign immunity. And clearly, the Tribe at issue in the case had not waived its sovereign immunity. Therefore, while the monopoly law applies (at least outside of tribal lands), a rural water district has no method to enforce it. I do not believe this would be the result under present Tenth Circuit law in Oklahoma.
The Freemanville motion to dismiss was decided on January 7, 2008. Since that date the federal appellate courts are exploring more carefully whether equitable claims, such as the ones in Freemanville for injunctive relief can proceed absent a waiver of tribal sovereign immunity. The Freemanville court cited Puyallup Tribe, Inc. v. Department of Game, 433 U.S. 165, 172 (1977) wherein the U.S. Supreme Court held that an injunction against a Tribe to enforce fishing restrictions on and off its reservation violated tribal sovereign immunity. However, that case, which went to the Supreme Court several times (the cited case is actually Puyallup III) involved treaty rights. But more importantly, the Tribe itself was the defendant in the Washington state court system. Under the doctrine of Ex Parte Young and the Tenth Circuit’s application of that doctrine to Indian tribes in Crowe & Dunlevy v. Stidham, Freemanville could have sued the tribal chairman or other office-holders in their official capacities to enforce their federal statutory rights for prospective injunctive relief. The reasoning is that a waiver of sovereign immunity is not necessary at all for a suit which is limited to prospective injunctive relief to stop an on-going violation of a federal law. Money damages are not available under Ex Parte Young. But, if a rural water district in Oklahoma seeks to avoid tribal encroachment, it will likely make use of Crowe & Dunlevy v. Stidham.
In Freemanville, the rural water district appealed to the Eleventh Circuit Court of Appeals. The Eleventh Circuit affirmed the judgment of the District Court in all respects on April 28, 2009. The Circuit court carefully examined the Rural Water Development Act to find a waiver of sovereign immunity, and like the trial court, it did not find one in 1926(b). The rural water district never sought leave to amend to sue the tribal government officials under Ex Parte Young. As a result, that issue was never raised.
Freemanville District Court Opinion
Freemanville District Court Opinion
