890 F.3d 1161
9th Cir.2018Background
- The United States sued in 1924 to adjudicate Walker River Basin water rights for the Walker River Paiute Tribe; the district court issued a decree in 1936 and retained jurisdiction to modify the decree.
- The Ninth Circuit (1939) reversed in part, recognizing a federal reserved Winters water right for the Tribe; the decree was amended and retained the court’s continuing jurisdiction.
- In 1991 Walker River Irrigation District (WRID) filed a petition in the 1924 proceeding to invoke the decree’s continuing jurisdiction (subfile A); in 1992 the Tribe filed counterclaims (subfile B) asserting additional storage, restored-lands, and groundwater rights, and the United States later sought leave to join and amended to assert additional federal Indian and federal-property claims.
- The district court ordered broad service on thousands of potential counterdefendants but instructed that an initial round of briefing would address jurisdictional (Rule 12(b)(1)) issues only, not preclusion.
- In May 2015 Judge Jones concluded he had jurisdiction under the decree but sua sponte dismissed all counterclaims as barred by res judicata (and alternatively laches or lack of jurisdiction), without prior briefing or argument on preclusion; the United States and Tribe appealed.
- The Ninth Circuit panel reversed: it held the court retained power to adjudicate additional rights under the decree, the counterclaims were not a new action and thus traditional claim/issue preclusion did not apply, and the district court erred by dismissing sua sponte without allowing adversarial briefing. The panel ordered reassignment on remand.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the 1936 Decree retained jurisdiction to adjudicate new/unlitigated water rights and modify the decree | Decree’s Paragraph XIV (retain jurisdiction to "correct or modify") permits adjudication of additional rights and modifications to water allocations | Paragraph XI ("forever enjoined...except the rights set up") and decree language bar additional claims; counterclaims are a new action needing separate filing | Court held Paragraph XIV permits modification to adjudicate additional rights; district court had jurisdiction over the counterclaims |
| Whether the Tribe’s/United States’ counterclaims constituted a new action (triggering claim preclusion) | Counterclaims were filed within the original 1924 caption/subproceeding and are part of the same case, not a new suit | Subfile designation and administrative separation show a distinct action; Paragraph XI precludes new claims | Court held counterclaims are not a new action; subfile administrative labeling does not convert them into a separate suit |
| Whether res judicata/issue preclusion barred the counterclaims | Because claims were brought in the same proceeding to modify/correct the decree, traditional claim/issue preclusion does not apply; any finality questions require adversarial briefing | Preclusive decree language and precedent (Nevada v. U.S.) bar relitigation of water rights, so claims are precluded | Court held district court erred to dismiss on res judicata without allowing briefing; Arizona v. California principles govern modification proceedings and res judicata is inapplicable in same-proceeding modification requests |
| Whether reassignment of the case on remand is required | United States asked for reassignment given judge’s prior conduct toward federal counsel and sua sponte rulings | Defendants opposed reassignment | Court ordered reassignment, concluding Judge Jones likely could not set aside prior views about the government and reassignment preserves appearance of justice |
Key Cases Cited
- Winters v. United States, 207 U.S. 564 (establishing federal reserved water rights doctrine)
- United States v. Walker River Irrigation Dist., 104 F.2d 334 (9th Cir.) (prior Ninth Circuit disposition of the 1936 decree)
- Arizona v. California, 460 U.S. 605 (1983) (court retained jurisdiction to consider increases in water rights and to modify decrees)
- Nevada v. United States, 463 U.S. 110 (1983) (res judicata principles applied to water decree language in a distinct context)
- In re United States (Mandamus), 791 F.3d 945 (9th Cir. 2015) (judge’s initial exclusion of DOJ counsel and related procedural history)
- Nat’l Council of La Raza v. Cegavske, 800 F.3d 1032 (9th Cir. 2015) (reassignment standard and prior use of sua sponte rulings to justify reassignment)