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January 2007

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Catawba Indian Tribe of South Carolina, Respondent, v. The State of South Carolina and Henry D. McMaster, in his official capacity as Attorney General of the State of South Carolina, Appellants

In 1993, the State of South Carolina entered into a settlement agreement with the Catawba Indian Tribe which resolved numerous legal claims the Tribe sought to pursue against the State.  Upon approval by the General Assembly and Congress, the settlement agreement was codified at S.C. Code Ann. §§ 27-16-10, et seq., as the South Carolina Catawba Indian Claims Act (State Act).  Congress’ approval of the agreement is codified at 25 U.S.C. § 941 (Federal Act).

Section 27-16-110 states the following, in pertinent part:

(A)  Except as specifically provided in the federal implementing legislation and this chapter, all laws, ordinances, and regulations of South Carolina and its political subdivisions govern the conduct of gambling or wager by the Tribe on and off the Reservation.
  ….
(G)  The Tribe may permit on its Reservation video poker or similar electronic play devices to the same extent as the devices are authorized by state law.  The Tribe is subject to all taxes, license requirements, regulations, and fees governing electronic play devices provided by state law, except if the Reservation is located in a county or counties which prohibit the devices pursuant to state law, the Tribe nonetheless must be permitted to operate the devices on the Reservation if the governing body of the Tribe so authorizes, subject to all taxes, license requirements, regulations, and fees governing electronic play devices provided by state law.

The Tribe brought this declaratory judgment action on July 28, 2005, seeking a declaration “that the Tribe has the present right to operate video poker or similar electronic play devices on its Reservation.”  It also sought a declaration that the General Assembly has violated the Federal Act by amending the State Act relative to the conduct of bingo without consent by the Tribe to the amendment as is required by 25 U.S.C. § 941m(f).  Finally, the Tribe sought injunctive relief preventing the State, the Attorney General and their agents, employees or representatives from interfering with the Tribe’s right to conduct video poker or similar electronic play devices on its Reservation and preventing interference with the conduct of bingo as described in the settlement agreement and the State Act. 

Both sides filed motions for summary judgment.  A hearing was held before Special Circuit Court Judge Joseph M. Strickland on December 2, 2005.  The Tribe submitted the affidavit of A. Crawford Clarkson, Jr., a former member of the South Carolina Tax Commission and the lead negotiator for the State in the settlement with the Tribe.  The State submitted the affidavit of Senator Robert Wesley Hayes, Jr., who was a member of the General Assembly at the time the settlement agreement was negotiated and was involved in the negotiations.  Judge Strickland found that if section 27-16-110(G) contained only the first sentence, the Tribe could not allow video poker on the Reservation once the state prohibited video poker.  However, he found the second sentence

recognizes the governmental status of the Tribe and its authority over its Reservation by making this exception to the prohibition against video poker contingent upon the game being operated by the Tribe after approval by the governing body of the Tribe . . . . Since video poker is to be operated only on the Reservation, and then only if approved by the Tribe’s governing body, there is no conflict with sate [sic] law with respect to video poker in those portions of the state where the Tribe has no sovereign governmental powers as it does on the Reservation. . . . Since section 27-16-110(G) does not make the Tribe’s right to “operate” video poker or similar electronic play devices on the Reservation contingent upon the continued legality of video poker elsewhere in the state, that limitation cannot be read into the portion of the statute addressing video poker and similar electronic play devices.  Similarly, since there is no reference directly or indirectly in the State Act to “county-by-county referendum” or “local option referendum” section 27-16-110(G) cannot be read as if that language were contained therein. . . . [S]ince the Reservation is located in counties which prohibit video poker and similar electronic play devices pursuant to state law, the Tribe may operate those devices on the Reservation if authorized by the governing body of the Tribe.

Judge Strickland found the language of the statute was not ambiguous with respect to the Tribe’s right to operate video poker and similar electronic devices on its Reservation.  He found further that the plain meaning of the statute supports the goals of Congress as set forth in 25 U.S.C. § 941(a)(1)[1] and is necessary under the rules of statutory construction to be applied in this case.  See Montana v. Blackfeet Tribe of Indians, 471 U.S. 759, 105 S.Ct. 2399, 85 L.Ed.2d 753 (1985)(“statutes are to be construed liberally in favor of the Indians with ambiguous provisions interpreted to their benefit”).

With regard to the bingo issues, section 27-16-110 contains several provisions addressing the conduct of bingo on the Reservation.  Section 27-16-110(B) states:

The State shall govern the conduct of bingo under Article 24, Chapter 21 of Title 12, Regulation of Bingo Games, including regulations or rulings issued in relation to that article, except as provided by the special bingo license to which the Tribe is entitled in accordance with this section if it elects to sponsor bingo games under the special license.

The General Assembly, in 1998, enacted S.C. Code Ann. § 12-21-4030(B)(1), which states a holder of a Class AA bingo license shall impose an entrance fee of $18.00.

Judge Strickland found that Congress has specifically prohibited the State from making unilateral amendments in the settlement agreement or the State Act.  Accordingly, he found that since Congress specifically approved a settlement agreement and State Act that do not include the $18.00 entrance fee, and the Tribe has never agreed to be subject to Article 24, Chapter 21 of Title 12 with respect to the conduct of bingo, the surcharge cannot be made applicable to the Tribe by the State.

Thereafter, the State filed a motion for reconsideration in which it argued, as it does before this Court, that Judge Strickland misconstrued section 27-16-110(G) and that “Catawba gaming” is to be governed by general state law.  The State argued further that the Tribe’s right to operate video poker on its Reservation was contingent on a county-by-county referendum on the subject provided for in legislation adopted subsequent to the settlement legislation.

Judge Strickland denied the motion, finding, based on Mr. Clarkson’s affidavit, that the plain language of the statute was consistent with the bargain struck with the Tribe on behalf of the State.  He further found that even if Mr. Clarkson’s affidavit had not been before the court, he would have concluded section 27-16-110(G) was an exception to state gaming laws as specifically recognized by Congress in 25 U.S.C. § 941l(b).[2]  Based on this language, Judge Strickland found “Congress gave force to the language agreed to by the State and incorporated in the state settlement legislation as section 27-16-110(G) so that both the General Assembly and Congress ‘specifically provided’ that the governing body of the Tribe alone has the authority to determine whether or not the Tribe will operate video poker or similar electronic play devices on the Reservation.”

Judge Strickland also found the State had presented nothing in support of its motion to reconsider which indicated the Tribe consented to a modification of the settlement agreement or state settlement legislation to subject the Tribe’s bingo to the terms of Article 24, Chapter 21 of Chapter 12, and federal law precludes amendment of the settlement agreement or state settlement legislation without the consent of both the State and the Tribe.

The State filed a notice of appeal in the South Carolina Court of Appeals.  The appeal was certified to the South Carolina Supreme Court pursuant to Rule 204(b), SCACR.  The State argues the circuit court erred in granting summary judgment to the Tribe on the ground the settlement agreement and State Act give the Tribe a present and continuing right to operate video poker or other similar electronic play devices on its Reservation.  The State argues further that the circuit court erred in granting summary judgment to the Tribe on the ground that the general bingo entrance fee imposed by § 12-21-4030(B)(1) was not applicable to the Tribe’s bingo operation. 


[1] This provision states:

The Congress declares and finds that:

(1) It is the policy of the United States to promote tribal self-determination and economic self-sufficiency and to support the resolution of disputes over historical claims through settlements mutually agreed to by Indian and non-Indian parties.

[2] This provision states:

The Tribe shall have the rights and responsibilities set forth in the Settlement Agreement and the State Act with respect to the conduct of games of chance.  Except as specifically set forth in the Settlement Agreement and the State Act, all laws, ordinances, and regulations of the State, and its political subdivisions, shall govern the regulation of gambling devices and the conduct of gambling or wagering by the Tribe on and off the Reservation.


Case Briefs

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Final Brief of Appellant (1.059 mb)
Final Reply Brief of Appellant (448 kb)

Brief of Respondent (1.165 mb)

 


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