873 N.W.2d 16
N.D.2015Background
- Arrow Midstream (Del. LLC) contracted 3 Bears (ND LLC, owned by tribal members) as general contractor to build a pipeline on a BIA-granted right-of-way easement across Fort Berthold Reservation trust land; 3 Bears subcontracted Tesla (AK LLC).
- After completion, Tesla recorded a state pipeline construction lien and claimed unpaid amounts from 3 Bears; Arrow sued in state district court to invalidate the lien and for breach/indemnity; 3 Bears moved to dismiss for lack of jurisdiction.
- 3 Bears subsequently filed a related action in Fort Berthold Tribal Court seeking similar relief shortly before the state court dismissed Arrow’s suit without prejudice for lack of jurisdiction and ordered exhaustion of tribal remedies.
- The state district court held tribal sovereignty and the Tribe’s interests over the easement precluded state jurisdiction and required comity/exhaustion.
- Arrow appealed and Tesla cross-appealed; the North Dakota Supreme Court considered (1) appealability of the dismissal and (2) whether the state court had subject-matter jurisdiction.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether dismissal without prejudice is appealable | Arrow: dismissal effectively forecloses state forum, so appealable | 3 Bears: dismissal without prejudice not appealable | Appealable — dismissal here effectively terminated litigation in state forum |
| Whether first Montana exception (consensual relationship) applies to 3 Bears (LLC formed under state law) | 3 Bears: tribal ownership/TERO ties make it an arm of Tribe => tribal jurisdiction | Arrow: 3 Bears is a state-organized LLC, distinct from Tribe; Airvator supports treating such entities as non-Indians | First Montana exception does not apply — 3 Bears is a state LLC, not a tribal member/arm |
| Whether the pipeline right-of-way is equivalent to non-Indian fee land (impacting second Montana exception) | 3 Bears: easement implicates tribal resources/economic interests, so tribal court jurisdiction appropriate | Arrow: easement is a congressionally authorized right-of-way akin to Strate; thus treated as non-Indian fee land for jurisdictional purposes | Easement treated as equivalent to non-Indian fee land; Montana second exception does not justify tribal jurisdiction |
| Whether Williams forecloses state court jurisdiction or requires exhaustion/comity | 3 Bears: tribal constitution/statutes, TERO, and IRA authorize tribe control; comity/exhaustion applies (LaPlante/Crow Tribe) | Arrow: suit is a state-law lien/contract dispute among non-members on land treated as non-Indian fee land; state jurisdiction not preempted; exhaustion not required | State court has subject-matter jurisdiction; exhaustion/comity requirement reversed |
Key Cases Cited
- Strate v. A-1 Contractors, 520 U.S. 438 (discusses right-of-way treated as equivalent to non-Indian fee land)
- Montana v. United States, 450 U.S. 544 (framework for tribal civil jurisdiction over nonmembers)
- Williams v. Lee, 358 U.S. 217 (limits state-court jurisdiction in Indian country to avoid infringing tribal self-government)
- Winer v. Penny Enters., Inc., 674 N.W.2d 9 (N.D. 2004) (dismissal without prejudice may be appealable if it effectively forecloses chosen forum)
- Airvator, Inc. v. Turtle Mountain Mfg. Co., 329 N.W.2d 596 (N.D. 1983) (state-chartered corporations/LLCs treated as non-Indians for jurisdictional purposes)
- Byzewski v. Byzewski, 429 N.W.2d 394 (N.D. 1988) (explains Williams and when state jurisdiction is precluded)