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Crow Allottees Association v. United States Bureau of Indian Affairs

United States District Court, D. Montana, Billings Division

June 30, 2015

CROW ALLOTTEES ASSOCIATION, et al., Plaintiffs,
v.
UNITED STATES BUREAU OF INDIAN AFFAIRS, et al., Defendants.

OPINION and ORDER

SUSAN P. WATTERS, District Judge.

The plaintiffs in this case are the Crow Allottees Association and numerous individuals who are members of the Crow Tribe and who own interests in allotments on the Crow Reservation (collectively the "Crow Allottees"). Presently before the Court are three motions seeking the dismissal of this case. Defendants Montana Water Court Chief Judge Russell McElyea and Associate Water Judge Douglas Ritter (collectively "Water Judges") moved to dismiss under Fed.R.Civ.P. 12(b)(6). Defendants United States Bureau of Indian Affairs, Department of the Interior, Secretary of the Interior Sally Jewell, and Assistant Secretary of the Interior for Indian Affairs Keven Washburn (collectively "Federal Defendants") filed an Answer and moved for judgment on the pleadings pursuant to Fed.R.Civ.P. 12(c). The Water Judges later filed another Motion to Dismiss on a new theory.

The Court finds that the Federal Defendants have not waived their sovereign immunity. Therefore, the Court grants the Federal Defendants' Motion for Judgment on the Pleadings. The Court will delay ruling on the Water Judges' Motions to Dismiss in light of the Crow Allottees' recent Motion to Supplement. (Doc. 57).

I. Background

The Crow Allottees challenge the Water Compact entered into between the Crow Tribe, the State of Montana, and the United States. To put their arguments and the Water Compact in context, the Court will briefly discuss the history of the Crow Reservation and the associated water rights.

A. Pre-Water Compact Background

In 1851, the United States and several Native American tribes entered into the Treaty of Fort Laramie. (Doc. 3 at 20). The treaty provided 38.5 million acres for the Crow Tribe across what is now Montana and Wyoming. (Id.). In 1868, the Crow Tribe's reserved boundary was reduced to about 8 million acres in another Treaty of Fort Laramie. (Id.). In 1891, the Crow Tribe ceded two million acres to the federal government by an act of Congress. (Id. at 21). In 1904, the federal government further reduced the Crow Reservation to its present size of 2.3 million acres. (Id.).

Pursuant to the 1887 Dawes Severalty Act, 24 Stat. 388, and the 1920 Crow Allotment Act, 41 Stat. 751, reservation land was allotted and distributed to enrolled members of the Crow Tribe. (Id.). The allottees were issued trust patents, with the legal title to the allotments held in trust by the United States.[1] (Id.). The allotments can be devised or passed down according to Montana's intestacy laws. See Babbitt v. Youpee, 519 U.S. 234, 237 (1997).

In 1908, the Supreme Court decided Winters v. United States, 207 U.S. 564 (1908). Now known as the Winters doctrine or Winters rights, the Court held that the United States impliedly reserved in Indian treaties a right to the amount of water to fulfill the purposes of establishing reservations. See United States v. Anderson, 736 F.2d 1358, 1362 (9th Cir. 1984). In other words, even though not explicitly in the treaties establishing the reservations, tribal members have the right to sufficient water for agricultural purposes. See Winters, 207 U.S. at 576. The priority date for Winters rights is the date the reservation was established. Id. at 577. Also, tribal members do not lose their Winters rights by non-use. Colville Confederated Tribes v. Walton, 647 F.2d 42, 51 (9th Cir. 1981).

This senior, non-expiring water right is valuable for tribal members. The doctrine of appropriation governs water rights in western states, including Montana. In re Adjudication of the Existing Rights to the Use of All the Water, 55 P.3d 396, 399 (Mont. 2002). Under the doctrine of appropriation, "rights to water for irrigation are perfected and enforced in order of seniority, starting with the first person to divert water from a natural stream and apply it to a beneficial use." Montana v. Wyoming, 131 S.Ct. 1765, 1772 (2011). Once perfected, the senior holder may fulfill his right to the "beneficial use" of water before junior appropriators get any water. Id. However, a typical senior right could be abandoned through non-use. See Heavirland v. State, 311 P.3d 813, 818 (Mont. 2013). Conversely, a tribal member holding Winters rights cannot lose the senior position through abandonment.

In 1973, the Montana Legislature passed the Montana Water Use Act, which requires all water rights in Montana to be adjudicated. Mont. Code Ann. Title 85, chapter 2. The United States initiated litigation in this Court to quantify the Crow Tribe's water rights in 1975. United States v. Big Horn Low Line Canal Co., CIV 75-34-BLG-JDS.[2]In 1979, Montana established a Reserved Water Rights Compact Commission to negotiate water compacts with Native American tribes. Mont. Code Ann. §§ 2-15-212(1), 85-2-702.

B. The Crow Tribe-Montana Water Rights Compact and the Settlement Act

Montana and the Crow Tribe commenced negotiations regarding a water compact in 1981. Mont. Code Ann. § 85-20-902(2). In 1999, the Crow Tribe, Montana, and the United States entered into the Crow Tribe-Montana Water Rights Compact ("Compact"). The Compact is found at Mont. Code. Ann. § 85-20-901.

The Compact defines "Tribal Water Right" as the "right of the Crow Tribe, including any Tribal member, to divert, use, or store water as described in Article III of this Compact." Compact, Art. II.30. Therefore, the allottees' water rights must come out of the amounts designated as a Tribal Water Right. Article III specifies exactly how much water is included in the Tribal Water Rights in each basin within or near the Crow Reservation. The Tribal Water Rights will be administered by and distributed to the Tribal members by the Tribe through the Tribal Water Resources Department. Id., Art. IV.A.2.a. The Compact requires the Tribe to develop a Tribal Water Code to guide the administration of the Tribal Water Rights. Id., Art. IV.A.2.b.

The Compact became effective when ratified by Montana, the Tribe, and the United States Congress. Id., Art. VII.A. I. Upon ratification, an action was initiated in the Montana Water Court to adopt a proposed decree "as the decree of the water rights held by the United States in trust for the Crow Tribe." Id., Art. VII.B.2. If the Water Court adopts the proposed decree, the parties must file in this Court a Stipulation to Dismiss in Big Horn Low Line Canal Co. Id., Art. VII.B.4. Finally, the Crow Tribe and the United States on behalf of the allottees agreed that the Compact satisfies any water rights based on Winters. Id., Art. VII.C.

The Montana Legislature ratified the Compact later in 1999. Beginning in 2008, efforts began to have Congress ratify the Compact. See Doc. 35 at 16. On November 16, 2009, the Crow Allottees wrote a letter to the Assistant Secretary of the Interior and expressed a concern that the Department of the Interior had a conflict of interest between representing the federal government's water rights and the allottees' individual water rights. (Doc. 3-1). To remedy that concern, the Crow Allottees demanded that the United States provide funds to retain independent counsel. (Id.). On February 5, 2010, the Department responded in a letter that it would be impractical to include each allottee in the negotiations, but it assured the Crow Allottees that the United States would act in their best interests. (Doc. 3-2). The Department said it would "find out more about the Crow Allottees Association and how the Association might assist the Department as it considers the rights of allottees within the context of the Crow settlement." (Id.). This is the last communication with the United States referenced by the Crow Allottees. The Department did not provide the Crow Allottees with funds to retain private counsel.

On December 8, 2010, Congress passed the Crow Tribe Water Rights Settlement Act of 2010 ("Settlement Act"). The Settlement Act is found at §§ 401-416 of the larger Claims Resolution Act of 2010, Pub. L. No. 111-291, 124 Stat 3064. The Settlement Act's stated purpose is to "achieve a fair, equitable, and final settlement of claims to water rights in the State of Montana for... the Crow Tribe... [and] the United States for the benefit of the Tribe and allottees." Settlement Act, § 402(1). Through the Settlement Act, Congress ratified the Compact. Id., § 404(a)(l).

The Settlement Act established the means of dividing the Tribal Water Rights defined in the Compact. Congress's goal is "to provide to each allottee benefits that are equivalent to or exceed the benefits allottees possess as of the date of enactment of this Act." Id., § 407(a).

Under the Settlement Act, the Tribal Water Rights are held in trust by the United States for the Tribe and the allottees. Id., § 404(c)(l). Any entitlement of water by an allottee must be satisfied by the Tribal Water Rights. Id., § 407(d)(2). Each allottee "shall be entitled to a just and equitable allocation of water for irrigation purposes." Id., § 407(d)(3).

To administer the Tribal Water Rights among the allottees, the Tribe must create a Tribal Water Code. Id., § 407(f)(l). The Tribal Water Code must include:

(A) tribal allocations of water to allottees shall be satisfied with water from the tribal water rights;
(B) charges for delivery of water for irrigation purposes for allottees shall be assessed on a ...

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