Chief Justice John Marshall recognized that Indian tribes are “distinct, independent political communities, retaining their original natural rights, as the undisputed possessors of the soil, from time immemorial.”1 But he also described tribes as “domestic dependent nations.”2 In the last half century, the Supreme Court has used the latter rationale to abrogate tribal sovereignty.3 In Montana v. United States,4 the Court expounded the presumption that tribal civil jurisdiction over nonmembers5 is “inconsistent with the dependent status of the tribes,”6 recognizing two exceptions: First, “[a] tribe may regulate . . . the activities of nonmembers who enter consensual relationships with the tribe or its members.”7 Second, a tribe may regulate nonmember conduct that has a “direct effect on the political integrity, the economic security, or the health or welfare of the tribe.”8 Recently, in Lexington Insurance Co. v. Smith,9 the Ninth Circuit denied a petition for rehearing en banc,10 leaving intact the panel’s holding that nonmember physical presence on a reservation is not required to satisfy Montana’s first exception.11 In dissent, Judge Bumatay warned that tribal courts lack structural and constitutional protections for nonmembers.12 But his argument is divorced from the realities of modern tribal practices, which generally feature robust protections for nonmember litigants. The Ninth Circuit correctly dismissed an unsubstantiated policy concern that would further divest tribes of sovereignty.
Lexington originated from a dispute between the Suquamish Tribe and its insurer.13 The Suquamish Tribe is a federally recognized Indian tribe located on the Port Madison Reservation in Suquamish, Washington.14 In 2019, the Tribe purchased an insurance policy covering losses to the Tribe through “Tribal First,”15 which describes itself as “the largest provider of insurance solutions to Native America.”16 The lead insurer on this policy was Lexington Insurance Company, a Delaware corporation that provides insurance through the Tribal First program.17 Following the COVID-19 pandemic, the Tribe submitted claims to Lexington for losses of business and tax revenue, among other expenses.18 Lexington responded with a reservation of rights letter.19
The Tribe sued Lexington in Suquamish Tribal Court for breach of contract and a declaratory judgment that Lexington owed it “millions of dollars” for COVID-related losses.20 Lexington moved to dismiss for lack of subject matter and personal jurisdiction.21 The court denied the motions, and Lexington appealed.22 The Suquamish Tribal Court of Appeals affirmed.23
Having exhausted its tribal court remedies,24 Lexington filed a complaint in the U.S. District Court for the Western District of Washington seeking a declaratory judgment that the Suquamish Court did not have subject matter or personal jurisdiction over it.25
Judge Estudillo granted the Tribe’s motion for summary judgment and denied Lexington’s.26 He began by noting that in the Ninth Circuit, Montana generally applies only on reservation land that is not tribally owned.27 The question thus became “whether the dispute involve[d] conduct or activities on tribal land such that the Tribe’s right to exclude confer[red] tribal adjudicative jurisdiction over the dispute.”28 Judge Estudillo answered this question in the affirmative, reasoning that “providing insurance to businesses and property owned by the Tribe (or its tribal members), operated by the Tribe (or its tribal members), and located on tribal land involves conduct or activity on tribal land that concerns tribal sovereignty.”29 He separately reasoned that the “contractual relationship between the parties that ar[ose] out of activities occurring on tribal property owned by tribal members” satisfied Montana’s first exception, but that Montana’s second exception was not satisfied.30 Finally, Judge Estudillo ruled that the Tribe had personal jurisdiction over Lexington, holding the issue to be controlled by Allstate Indemnity Co. v. Stump,31 which also concerned a foreign insurance company’s amenability to suit in tribal court.32 Lexington appealed only the issue of subject matter jurisdiction.33
The Ninth Circuit affirmed.34 Writing for the unanimous panel, Judge McKeown35 first concluded that “Lexington’s conduct occurred not only on the reservation, but on tribal lands,”36 thereby “triggering the presumption of jurisdiction.”37 Although “neither Lexington nor its employees were ever physically present [on the reservation] . . . a tribe has regulatory jurisdiction over a nonmember who ‘enters tribal lands or conducts business with the tribe.’”38 The correct test of whether nonmember conduct occurred on tribal lands asks not only “‘when and where the claim arose’ but [also] ‘whether the cause of action brought by the[] parties bears some direct connection to tribal lands.’”39 The court ruled that the Tribe’s claim satisfied this test because of its “clear nexus” to “Lexington’s coverage of tribal properties on tribal land.”40
Judge McKeown then affirmed tribal jurisdiction under the first Montana exception.41 Crucially, she ruled that the Tribe and Lexington entered into a consensual relationship, that Lexington should have reasonably anticipated the exercise of tribal jurisdiction, and that there was a nexus between tribal jurisdiction and the consensual relationship itself.42 Finally, the court held that its decision was in accordance with Plains Commerce Bank v. Long Family Land & Cattle Co.,43 which Judge McKeown said only affirmed sources of tribal jurisdiction and did not add limitations on the Montana exceptions.44
The Ninth Circuit denied a petition for rehearing en banc by a vote of sixteen to six.45 Judges Hawkins, Graber, and McKeown46 wrote an opinion respecting the denial of rehearing en banc.47 The opinion reiterated that tribal jurisdiction was proper because “Lexington’s relationship with the Tribe . . . b[ore] a ‘direct connection to tribal lands’”48 and because Lexington conducted business with the Tribe.49 It rejected the dissent’s invocation of a physical presence requirement, writing that it had no foundation in Supreme Court or Ninth Circuit precedent.50 Finally, it dismissed the dissent’s argument that Plains Commerce imposed an additional requirement that jurisdiction “must stem from the tribe’s inherent sovereign authority to set conditions on entry, preserve tribal self-government, or control internal relations.”51 Rather, the Supreme Court was “merely clarifying that a nonmember’s consent to tribal law is not enough for tribal jurisdiction.”52
Judge Bumatay dissented.53 Writing that the panel’s decision “defies both the Constitution and Supreme Court precedent,”54 Judge Bumatay asserted that it is “a startling expansion of tribal court jurisdiction in two ways.”55 “First, the panel . . . gutted any geographic limits of tribal court jurisdiction,” becoming the first circuit to allow tribal jurisdiction over a nonmember without requiring actual nonmember physical presence.56 Because the Supreme Court’s “Montana cases have always concerned nonmember conduct on the land,”57 Judge Bumatay viewed physical conduct on the reservation as a requirement for tribal jurisdiction over a nonmember.58 Lexington, which conducted “no activity whatsoever” on tribal lands, would thus not be subject to tribal jurisdiction.59
Second, Judge Bumatay wrote that the panel removed “all substantive limits on what nonmember activity tribes may regulate.”60 He argued that Plains Commerce imposed a requirement that tribal jurisdiction “stem[] from the tribe’s inherent sovereign authority to set conditions on entry, preserve tribal self-government, or control internal relations.”61 “The regulation of insurance contracts has nothing to do” with those sources of authority, leaving “no role for tribal regulation.”62
To Judge Bumatay, “[g]ranting tribal court jurisdiction over nonmembers is no little matter.”63 “Tribal courts,” he wrote, “are unlike state and federal courts”64 — they feature no insulation from tribal political branches, rely on tribal law that is not well-defined, and are not bound by constitutional principles.65 These concerns are common among Supreme Court Justices66 and nonmember litigants67 alike.
But Judge Bumatay’s structural and constitutional arguments are divorced from the realities of modern tribal court litigation. Modern tribal courts generally feature robust protections for nonmembers, and the conditions that concern Judge Bumatay were not present in Lexington. Fortunately, the Ninth Circuit rejected Judge Bumatay’s unsubstantiated concerns instead of further divesting tribes of their jurisdiction and sovereignty. Other courts should similarly reject these baseless policy arguments.
First, tribal courts are not, as Judge Bumatay suggested, “subordinate to the political branches of tribal governments.”68 For support, Judge Bumatay cited to Duro v. Reina,69 which cites to the 1982 edition of Cohen’s Handbook of Federal Indian Law.70 But tribal courts have changed since 1982: The 2024 edition of Cohen’s Handbook states that “[t]he structure of tribal courts is often similar to that of state courts” and “[p]rinciples of judicial independence have strong and growing roots in tribal courts.”71 Increasingly, tribes are “professionaliz[ing] the[ir] judiciar[ies]” in ways that “insulate them from tribal political pressure.”72
The Suquamish Tribe itself is illustrative. Judges are appointed by the Suquamish Tribal Council, which may alter judges’ powers or set salaries only at the time of judicial appointment.73 And judges are removable by a two-thirds vote of the Tribal Council, but only for “misfeasance in office, neglect of duty,” “incapacity,” or “convict[ion] of a criminal offense.”74 Judicial independence is thus a central feature of the Suquamish judiciary, as it is in many tribal courts.
Next, contra Judge Bumatay’s assertion that “tribal courts don’t rely on well-defined statutory or common law” but on values “expressed in [their] customs, traditions, and practices,”75 tribal law is “written, knowable, and publicly available.”76 Tribal constitutions, codes, and judicial opinions, including those of the Suquamish Tribe, are available from tribal governments, often online.77 While it is true that some tribal courts use traditional, nonadversarial practices to resolve internal disputes,78 those courts do not typically apply them to nonmembers, but instead use common law from the Anglo-American tradition.79 And tribes have little incentive to apply unknown or unfair tribal law to nonmembers given the Supreme Court’s anxiety about that possibility.80
Finally, Judge Bumatay misunderstood tribal law when he wrote that “because the tribes lie ‘outside the basic structure of the Constitution,’ the Bill of Rights, including the rights of due process and equal protection, doesn’t apply in tribal courts.”81 As Judge Smith noted in her Suquamish Tribal Court opinion, the “Indian Civil Rights Act . . . guarantees the right of due process under the law.”82 Furthermore, “[t]he test for due process in tribal courts is no different than for state or federal courts.”83 Federal courts ensure that a tribal court’s exercise of personal jurisdiction over nonmembers complies with the Fourteenth Amendment.84 And the criminal procedure protections of the Bill of Rights are inapplicable, as tribal courts may not exercise criminal jurisdiction over non-Indians.85
Judge Bumatay specified only one constitutional concern: “[W]ithout any constitutional backstop, tribal suits are almost exclusively tried before tribe-member judges and all-tribe-member juries.”86 For support, he cited to a footnote in Oliphant v. Suquamish Indian Tribe,87 which states that tribes are “not explicitly prohibited from excluding non-Indians from the jury” and that the Suquamish tribal code provides “that only Suquamish tribal members shall serve as jurors in tribal court.”88 But Oliphant does not say that tribal courts employ “almost exclusively . . . tribe-member judges and . . . juries.”89 To the contrary, many tribal juries do include nonmembers,90 while some do not rely on juries for civil cases at all.91 And tribes, including the Suquamish Tribe, regularly hire judges who are nonmembers or non-Indian altogether.92
Sovereignty, at bottom, means “[s]upreme dominion, authority, or rule.”93 The Court has recognized that “[a]djudication of [reservation affairs] by any nontribal court . . . infringes upon tribal lawmaking authority, because tribal courts are best qualified to interpret and apply tribal law.”94 Chipping away at tribal jurisdiction, as Judge Bumatay would do, is chipping away at sovereignty. And divesting tribes of sovereignty is no little matter. After all, “the painful history of Indian tribes in this country may still end with their disappearance.”95 In Lexington, the Ninth Circuit did not allow an unsubstantiated policy concern to further divest tribes of their sovereign powers.96 Other courts should continue to reject these flawed arguments.