Cachil Dehe Band of v. State of California ( 2008 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
CACHIL DEHE BAND OF WINTUN 
INDIANS OF THE COLUSA INDIAN
COMMUNITY, a federally recognized
Indian Tribe,
Plaintiff-Appellant,
No. 06-16145
v.
STATE OF CALIFORNIA; CALIFORNIA  D.C. No.
CV-04-02265-FCD
GAMBLING CONTROL COMMISSION,
OPINION
an agency of the State of
California; and ARNOLD
SCHWARZENEGGER, Governor of the
State of California,
Defendants-Appellees.

Appeal from the United States District Court
for the Eastern District of California
Frank C. Damrell, District Judge, Presiding
Argued and Submitted
April 9, 2008—Pasadena, California
Filed August 8, 2008
Before: William C. Canby, Jr., Andrew J. Kleinfeld, and
Jay S. Bybee, Circuit Judges.
Opinion by Judge Canby
10159
CACHIL DEHE BAND v. CALIFORNIA 10163
COUNSEL
George Forman, Forman & Associates, San Rafael, Califor-
nia, for the plaintiff-appellant.
Christine M. Murphy, Deputy Attorney General, Sacramento,
California (briefs); Peter H. Kaufman, Deputy Attorney Gen-
eral, San Diego, California (oral argument); for the
defendants-appellees.
OPINION
CANBY, Circuit Judge:
This appeal concerns the joinder requirements of Rule 19
of the Federal Rules of Civil Procedure and their effect on liti-
gation brought by an Indian tribe engaged in casino gaming.
The Cachil Dehe Band of Wintun Indians of the Colusa
Indian Community (“Colusa”), a federally recognized Indian
tribe, entered into a gaming compact with the State of Califor-
nia in 1999. Colusa brought this action for declaratory and
injunctive relief against the State, its Governor and the Cali-
fornia Gambling Control Commission (collectively, “the
State”). Colusa challenges the Commission’s interpretation of
the compact and the Commission’s assumption of authority to
administer unilaterally the licensing of electronic gaming
devices. The district court concluded that the many other
Indian tribes that had entered into identical gaming compacts
with the State in 1999, as well as California’s non-gaming
tribes, were required parties to this action. Because Indian
tribes enjoy sovereign immunity and the action could not pro-
10164 CACHIL DEHE BAND v. CALIFORNIA
ceed in their absence, the district court granted the State’s
motion for judgment on the pleadings. Colusa appeals.
Because we conclude that the absent tribes are not required
parties to this action, we reverse the district court’s judgment
(with one minor exception) and remand for further proceed-
ings.
BACKGROUND
In 1988, Congress enacted the Indian Gaming Regulatory
Act (“IGRA”) “to provide a statutory basis for the operation
of gaming by Indian tribes as a means of promoting tribal
economic development, self-sufficiency, and strong tribal
governments.” 25 U.S.C. § 2702(1). IGRA recognizes three
classes of gaming. 25 U.S.C. § 2703(6)-(8). Slot machines
and equivalent gaming devices, which are the exclusive sub-
ject of this litigation, are Class III games. See 25 U.S.C.
§ 2703(7)(B)(ii), (8). Under the statute, a tribe may conduct
Class III gaming activities only “in conformance with a
Tribal-State compact entered into by the Indian tribe.” 25
U.S.C. § 2710(d)(1)(C).
In September 1999, Colusa entered into a gaming compact
(the “Compact”) with the State of California, which sets forth
various provisions relating to the operation of Class III gam-
ing devices. See Tribal-State Gaming Compact Between the
Colusa Indian Community and the State of California (Oct. 8,
1999). At the same time, sixty-two other tribes (the “Compact
Tribes”) executed virtually identical bilateral compacts with
the State (the “1999 Compacts”).1 See Artichoke Joe’s Cal.
Grand Casino v. Norton, 353 F.3d 712, 717-18 (9th Cir.
2003). The 1999 Compacts limit the number of gaming
devices operated by each tribe to 2,000. See 1999 Compacts,
§ 4.3.2.2(a). They also establish a formula setting a statewide
maximum number of gaming devices that all Compact Tribes
1
A generic copy of a 1999 Compact is available at
http://www.cgcc.ca.gov/enabling/tsc.pdf (last visited July 31, 2008).
CACHIL DEHE BAND v. CALIFORNIA 10165
may license in the aggregate under the 1999 Compacts. Id.
§ 4.3.2.2(a)(1).
A Compact Tribe, however, is not free to choose unilater-
ally how many gaming devices to operate, even if it wishes
to operate fewer devices than the 2,000 limit. The Compacts
establish a threshold number of devices that tribes may oper-
ate without a license. Id. § 4.3.1. In Colusa’s case, that num-
ber was set at the number of gaming devices, 523, operated
by the Tribe on September 1, 1999. For each additional gam-
ing device, Colusa is required to obtain a license. Id.
§ 4.3.2.2(a). These licenses are distributed among the Com-
pact Tribes who apply to obtain them pursuant to a detailed
draw process. See id. § 4.3.2.2(a)(3). Under this process, a
Compact Tribe’s likelihood of being awarded a license hinges
on its placement in one of five priority tiers. Id. Placement in
a particular tier depends in part—though not exclusively—
upon the number of gaming devices already operated by the
tribe; the fewer gaming devices a tribe operates, the higher its
priority tier. Id. If, in any given round, more licenses are
requested in aggregate by the Compact Tribes than the Com-
mission is distributing, the license draw process is structured
to award the bulk of those licenses to the Compact Tribes who
have not yet developed large gaming operations. Id.
In 2001, then-Governor Gray Davis issued an executive
order requiring the California Gambling Control Commission
(“Commission”) to take control of the licensing of gaming
devices. Exec. Order No. D-29-01 (Mar. 8, 2001). Previously,
a tribal administrator had conducted gaming device license
draws. As soon as the Commission assumed control, it
declared the licenses issued in previous draws invalid and
replaced them with licenses issued by the Commission.
The 1999 Compacts also envision a revenue-sharing mech-
anism for the benefit of California’s non-gaming tribes. See
1999 Compacts, § 4.3.2.1. In order to acquire licenses for
gaming devices in excess of their initial allowance, Compact
10166 CACHIL DEHE BAND v. CALIFORNIA
Tribes must pay “a non-refundable one-time pre-payment fee”
of $1,250 for each gaming device being licensed. Id.
§ 4.3.2.2(e). In addition, in order to keep their licenses cur-
rent, Compact Tribes must pay annual fees for each licensed
device in accordance with a pre-determined fee schedule. Id.
§ 4.3.2.2(a)(2). The fees are to be deposited in the Revenue
Sharing Trust Fund (“Revenue Fund”), a fund created by the
California State Legislature and administered by the Commis-
sion as trustee. Id. Each Non-Compact Tribe2 is entitled to
receive a distribution of $1.1 million per year from the Reve-
nue Fund, unless the funds therein are insufficient, in which
case the available funds are distributed in equal shares among
the Non-Compact Tribes. Id. § 4.3.2.1(a). The Commission
has interpreted the 1999 Compacts as providing that the non-
refundable, one-time pre-payment fee may be used as a credit
toward annual license fees, and that no annual fees would be
required for the first 350 licenses issued to a tribe.
Pursuant to the 1999 Compacts, the Legislature also created
the Indian Gaming Special Distribution Fund (“Distribution
Fund”). Cal. Gov’t Code § 12012.85. The 1999 Compacts
direct each gaming tribe to contribute to the Distribution Fund
a portion of its revenues calculated according to the number
of gaming devices operated and the “net wins” of those
devices. 1999 Compacts § 5.1(a). The Legislature may then
appropriate funds from the Distribution Fund to make up for
“shortfalls that may occur in the . . . Revenue . . . Fund. This
shall be the priority use of moneys in the . . . Distribution
Fund.” Cal. Gov’t Code § 12012.85(d).
In 2002, the Commission notified Colusa and other Com-
pact Tribes that it would conduct a round of gaming device
2
For purposes of revenue sharing, the 1999 Compacts define a Compact
Tribe as a tribe having a compact with the State authorizing Class III
Gaming; Non-Compact Tribes are defined as federally recognized tribes
that are operating fewer than 350 gaming devices, whether or not such a
tribe has a compact with the State.
CACHIL DEHE BAND v. CALIFORNIA 10167
license draws that September. Prior to the draw, Colusa was
operating its threshold number of 523 gaming devices for
which it did not need licenses. Colusa notified the Commis-
sion of its intent to draw 250 licenses and tendered a $312,500
check as its non-refundable one-time pre-payment fee. Colusa
was placed in the third priority tier and received 250 licenses.
In November 2003, the Commission notified Colusa that it
would conduct another round of draws in December 2003.
Colusa requested 377 licenses and submitted a pre-payment of
$471,250. Colusa was assigned to the fourth priority tier, a
classification that Colusa challenges in this litigation. Colusa
alleges that it was assigned to the fourth tier because it had
previously drawn some licenses in the third tier, even though
the number of gaming devices it operated after the earlier
drawing should have continued to place it in the third tier. The
December drawing was held with Colusa in the fourth tier and
it received no licenses. The Commission refunded the pre-
payment for those requested licenses in full. In October 2004,
the Commission conducted a third draw. Colusa advanced
fees for 341 licenses and was again placed in the fourth prior-
ity tier. It received only 73 licenses. Colusa anticipates receiv-
ing a refund of the pre-payment on the licenses that it did not
receive in the draw.
Immediately after the December 2003 draw, Colusa
requested that the Governor meet and confer with the Tribe
with regard to (1) Colusa’s assignment to the fourth priority
tier in the December 2003 draw; (2) the Commission’s deter-
mination of the statewide aggregate number of licenses avail-
able to all tribes for issuance under the 1999 Compacts; (3)
the Commission’s role and authority in the draw process; and
(4) the Commission’s retention of the $312,500 tendered by
the Tribe in connection with its draw of 250 licenses in Sep-
tember 2002. After an unsuccessful meeting, the State for-
mally rejected each of Colusa’s positions. Colusa then
initiated this litigation.
10168 CACHIL DEHE BAND v. CALIFORNIA
In its complaint, Colusa asserts that the State, through the
actions of the Commission, breached the Compact by: (1)
excluding Colusa from the third priority tier in the December
2003 and October 2004 draws; (2) unilaterally determining
the aggregate number of licenses authorized by the Compact;
(3) refusing to refund Colusa’s non-refundable one-time pre-
payment fee in conjunction with the licenses Colusa obtained
in September 2002 and October 2004; (4) conducting rounds
of draws of licenses without authority; and (5) failing to nego-
tiate in good faith. The State filed a motion for judgment on
the pleadings, seeking to dismiss Colusa’s first, second, third,
and fourth claims for failure to join necessary and indispens-
able parties and its fifth claim for failure to exhaust non-
judicial remedies.3 The district court granted the State’s
motion to dismiss and entered judgment in its favor. Colusa
appeals.
While Colusa’s appeal was pending, the State negotiated
and executed amendments to the 1999 Compacts individually
with at least five Indian tribes, not including Colusa.4 These
3
Colusa lists its fifth cause of action—failure to negotiate in good faith
—among its grounds for appeal. It does not, however, advance any argu-
ment in support of reversing the district court’s judgment with respect to
that claim. Accordingly, we deem the claim abandoned. See Fed. R. App.
P. 28(a)(9)(A); Acosta-Huerta v. Estelle, 7 F.3d 139, 144 (9th Cir. 1992)
(“Issues raised in a brief which are not supported by argument are deemed
abandoned.”) (quoting Leer v. Murphy, 844 F.2d 628, 634 (9th Cir.
1988)). We therefore affirm the district court’s dismissal of that claim.
4
Amendment to the Tribal-State Compact Between the State of Califor-
nia and the Agua Caliente Band of Cahuilla Indians (Aug. 8, 2006);
Amendment to the Tribal-State Compact Between the State of California
and the Morongo Band of Mission Indians (Aug. 29, 2006); Amendment
to the Tribal-State Compact Between the State of California and the
Pechanga Band of Luiseno Mission Indians (Aug. 28, 2006); Amendment
to the Tribal-State Compact Between the State of California and the Syc-
uan Band of the Kumeyaay Nation (Aug. 30, 2006); Amendment to the
Tribal-State Compact Between the State of California and the San Manuel
Band of Serrano Mission Indians of the San Manuel Reservation (Aug. 28,
2006); see also Indian Gaming, 72 Fed. Reg. 71,939-02–71,939-04 (Dec.
CACHIL DEHE BAND v. CALIFORNIA 10169
amended compacts, which became effective between Decem-
ber 2007 and January 2008 (“2007 Amended Compacts”),
provide for the issuance of up to 22,500 additional gaming
device licenses outside the limits established by the 1999 Com-
pacts.5 See 2007 Amended Compacts § II.B (amended
§ 4.3.1(a)). In addition, four of the five 2007 Amended Com-
pacts provide that, if a shortfall occurs in the Revenue Fund,
“the State Gaming Agency shall direct a portion of the reve-
nue contribution” made by each of the 2007 Compact Tribes
“to increase the revenue contribution to the [Revenue Fund]
in an amount sufficient to ensure the [Revenue Fund] has suf-
ficient resources for each eligible recipient Indian tribe to
receive quarterly payments pursuant to Government Code
Section 12012.90.” E.g., Amendment to the Tribal-State
Compact Between the State of California and the Morongo
Band of Mission Indians § II.B (Aug. 29, 2006) (amended
§ 4.3.1.(l)), available at http://www.cgcc.ca.gov/compacts.asp
(last visited July 31, 2008). The aggregate revenue contribu-
tion made by these four tribes, which is therefore available to
fill any shortfall in the Revenue Fund, exceeds $140 million
per year. See 2007 Amended Compacts § II.B (amended
§ 4.3.1(b)(i)).
19, 2007) (notices); Indian Gaming, 73 Fed. Reg. 3,480-01 (Jan. 18, 2008)
(notice); California Gambling Control Commission, Tribal-State Gaming
Compacts, http://www.cgcc.ca.gov/compacts.asp (last visited July 31,
2008). We take judicial notice of these amended compacts pursuant to
Federal Rule of Evidence 201, which “permits us to ‘take judicial notice
of the records of state [entities] and other undisputed matters of public
record,’ [including] executed Compact[s] . . . not in the district court
record.” Wilbur v. Locke, 423 F.3d 1101, 1112 (9th Cir. 2005) (quoting
Disabled Rights Action Comm. v. Las Vegas Events, Inc., 375 F.3d 861,
866 n.1 (9th Cir. 2004)). We note and overrule the State’s objection to our
consideration of these materials.
5
The 2007 Amended Compacts allow the amending tribes to continue
operating machines pursuant to licenses previously issued under the pool
provision as well as machines which were operated on September 1, 1999.
The pool provision licenses remain in force even though the 2007
Amended Compacts repeal the pool provision itself.
10170 CACHIL DEHE BAND v. CALIFORNIA
DISCUSSION
In addressing the State’s Rule 19 motion to dismiss Colu-
sa’s claims for failure to join required parties, “the proper
approach is first to decide whether the tribes are . . . ‘[re-
quired]’ parties who should normally be joined under the
standards of Rule 19(a).” Am. Greyhound Racing, Inc. v. Hull,
305 F.3d 1015, 1022 (9th Cir. 2002).6 If, as the district court
concluded in this case, the tribes are required parties, “the
court must determine whether, in equity and good conscience,
the action should proceed among the existing parties or
should be dismissed.”7 Fed. R. Civ. P. 19(b). On appeal, we
review the district court’s Rule 19 determinations for an abuse
of discretion. Am. Greyhound Racing, 305 F.3d at 1022; cf.
Republic of the Philippines v. Pimentel, 128 S. Ct. 2180, 2189
(2008) (declining to address the standard of review for Rule
19(b) decisions). To the extent that in its inquiry the district
court “decided a question of law, we review that determina-
tion de novo.” Am. Greyhound Racing, 305 F.3d at 1022.
The issue that we find dispositive of all contested portions
of this appeal is whether the absent tribes are “required” par-
ties to the adjudication of Colusa’s first, second, third and
fourth claims within the meaning of Rule 19(a). We conclude
6
The language of Federal Rule of Civil Procedure 19 has been amended
since the district court’s dismissal of this action. The Rules Committee
advised that the changes were “stylistic only,” see Fed. R. Civ. P. 19 advi-
sory comm. nn. (2008), and the Supreme Court has agreed, see Republic
of the Philippines v. Pimentel, 128 S. Ct. 2180, 2184 (2008). Two changes
are relevant to this case. First, the word “required” replaced the word
“necessary” in subparagraph (a). Second, the word “indispensable” is
deleted from the current text of subparagraph (b). All quotations hereinaf-
ter to materials predating the 2007 amendment are altered, with brackets,
to reflect the current language of Rule 19.
7
The parties do not dispute that the absent tribes enjoy sovereign immu-
nity. See Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58 (1978). Accord-
ingly, because they have not consented to suit, they cannot be joined in
this action.
CACHIL DEHE BAND v. CALIFORNIA 10171
that they are not, and that the district court abused its discre-
tion in finding that the absent tribes were required parties to
the disposition of these claims. We accordingly reverse the
district court’s judgment with respect to those claims and
remand for further proceedings. Our conclusion that the
absent tribes are not required parties under Rule 19(a) makes
inapplicable the provisions of Rule 19(b) governing the deci-
sion whether to proceed with litigation when a required party
cannot be joined; we therefore do not address the district
court’s determination of that issue.8
[1] The absent tribes are “required” parties to this action if
they “claim[ ] an interest relating to the subject of the action
and [are] so situated that disposing of the action in [their]
absence may: (i) as a practical matter impair or impede [their]
ability to protect the interest; or (ii) leave an existing party
subject to a substantial risk of incurring double, multiple, or
otherwise inconsistent obligations because of the interest.”
Fed. R. Civ. P. 19(a)(1)(B) (emphases added).9 A crucial
premise of mandatory joinder, then, is that the absent tribes
possess an interest in the pending litigation that is “legally
protected.” Makah Indian Tribe v. Verity, 910 F.2d 555, 558
(9th Cir. 1990). We have developed few categorical rules
informing this inquiry. At one end of the spectrum, we have
held that the interest at stake need not be “property in the
sense of the due process clause.” Am. Greyhound Racing, 305
F.3d at 1023. At the other end of the spectrum, we have rec-
ognized that the “interest must be more than a financial stake,
8
For the same reason, our analysis is not affected by the Supreme
Court’s recent holding in Pimentel, 128 S. Ct. at 2190. In Pimentel, the
Supreme Court reversed the decision of a panel of this court because it had
not “giv[en] full effect to sovereign immunity” in its Rule 19(b) calculus.
Id. Because in our case the absent tribes are not required parties under
Rule 19(a), we are unaffected by the Rule 19(b) analysis set forth in
Pimentel.
9
The State does not contend that, in the absence of the other Compact
(or Non-Compact) Tribes, “the court cannot accord complete relief among
existing parties.” Fed. R. Civ. P. 19(a)(1)(A).
10172 CACHIL DEHE BAND v. CALIFORNIA
and more than speculation about a future event.” Makah, 910
F.2d at 558 (citations omitted); see also N. Alaska Envtl. Ctr.
v. Hodel, 803 F.2d 466, 468-69 (9th Cir. 1986) (holding that
miners who had submitted mining plans to National Park Ser-
vice were not necessary parties to an action to enjoin mining
in parks until environmental impact statements were pre-
pared). Within the wide boundaries set by these general prin-
ciples, we have emphasized the “practical” and “fact-specific”
nature of the inquiry. Makah, 910 F.2d at 558; see also Bakia
v. County of Los Angeles, 687 F.2d 299, 301 (9th Cir. 1982)
(per curiam) (“There is no precise formula for determining
whether a particular nonparty should be joined under Rule
19(a) . . . . The determination is heavily influenced by the
facts and circumstances of each case.”). Accordingly, an
interest that “arises from terms in bargained contracts” may
be protected, but we have required that such an interest be
“substantial.” Am. Greyhound Racing, 305 F.3d at 1023. An
interest in a fixed fund or limited resource that the court is
asked to allocate may also be protected. Makah, 910 F.2d at
558-59. At the same time, an absent party has no legally pro-
tected interest at stake in a suit merely to enforce compliance
with administrative procedures. See N. Alaska, 803 F.2d at
469; Makah, 910 F.2d at 559 (“The absent tribes would not
be prejudiced because all of the tribes have an equal interest
in an administrative process that is lawful.”).
The Size of the License Pool
Colusa challenges the Commission’s computation of the
statewide maximum number of licences that may be issued
under the 1999 Compacts. The district court dismissed Colu-
sa’s claim, concluding that the other Compact Tribes are
required parties in the absence of which the action should be
dismissed. Although we agree with the district court that some
absent tribes may prefer that the State issue fewer licenses, we
reverse its dismissal of Colusa’s claim because the absent
tribes’ only interest relevant for Rule 19(a) purposes is free-
CACHIL DEHE BAND v. CALIFORNIA 10173
dom from competition. We hold that this interest, without
more, is not “legally protected” for Rule 19 purposes.
[2] It is important to identify clearly the Compact Tribes’
interest at stake. Those Compact Tribes that currently enjoy
a dominant position in the gaming industry will likely prefer
to maintain a low statewide maximum number of licenses
available under the 1999 Compacts. On the other hand, those
who intend to expand their gaming operations and compete
with the dominant gaming tribes will gladly accept an
increase in the size of the license pool created by the 1999
Compacts. Indeed, the State itself repeatedly characterizes the
absent tribes’ interest at stake as the preservation of their
“market share” within California’s gaming industry. Properly
framed, then, the respective advantages that various tribes
may enjoy under a more generous or restrictive interpretation
of the pool provision are an economic incident of their market
positions under a common licensing regime.
[3] The mere fact that the outcome of Colusa’s litigation
may have some financial consequences for the non-party
tribes is not sufficient to make those tribes required parties,
however. See, e.g., Makah, 910 F.2d at 558 (“[The] interest
must be more than a financial stake.”). The absent tribes must
have a legally protected interest and, on this record, the only
potential protection lies in the 1999 Compacts themselves.
The interest could be protected if it actually “arises from
terms in bargained contracts.” Am. Greyhound Racing, 305
F.3d at 1023. We conclude that it does not.10 The 1999 Com-
10
We do not decide the broader question whether avoiding competition
ever qualifies as a legally protected interest under Rule 19(a) in the con-
text of Indian gaming. We note, however, that the legislative history of
IGRA casts considerable doubt on a state’s assertion of any such interest
in the context of Indian gaming; the Senate’s Select Committee on Indian
Affairs reported its intent that the states not use IGRA’s Class III gaming
compact requirement as a protectionist measure, although that concern
was directed at the protection of non-tribal operators, not absent tribes as
in this case. See S. Rep. No. 100-446, at 13 (1988), reprinted in 1988
U.S.C.C.A.N. 3071, 3083.
10174 CACHIL DEHE BAND v. CALIFORNIA
pacts do not purport to establish, through the license pool pro-
vision or otherwise, an overarching limit on the number of
gaming licenses generally available in California. Rather, they
place a limit only on the smaller universe of licenses that may
be issued under the 1999 Compacts.11 This limit alone is
insufficient to determine the competitive landscape of Califor-
nia’s gaming industry, for it leaves the State at liberty to issue
an unlimited number of licenses outside the pool created by
the 1999 Compacts. Indeed, the State has recently negotiated
amendments, now in effect, to the 1999 Compacts with sev-
eral tribes. These amendments provide for the issuance of up
to 22,500 additional licenses outside the pool created by the
1999 Compacts. These actions reflect the reality that the 1999
Compacts afford no express or implied protection against
competition per se. The interest of some of the absent tribes
in avoiding competition does not “arise[ ] from terms in bar-
gained contracts,” id., and is accordingly not “legally protect-
ed” under the circumstances of this case. The absent 1999
Compact tribes thus are not required parties for litigation of
Colusa’s claim seeking to raise the aggregate limit on licenses
under the 1999 Compacts.
In reaching this conclusion, we reject the State’s contention
that its licensing scheme is comparable to the system for the
allocation of limited resources at issue in Makah. In Makah,
we held that absent tribes had a protected interest that made
them necessary parties to a claim for amendment of a pre-
existing allocation of a finite resource—a particular year’s
off-shore salmon harvest—because an allocation to one tribe
necessarily entailed the parallel deprivation of another.
Makah, 910 F.2d at 556-57. The resource at issue was finite:
ocean fishing of salmon in excess of the total permitted har-
vest would jeopardize the survival of the species’ population
in the region’s weakest runs. Id. at 557. In contrast, the gam-
11
The 1999 Compacts establish a formula for a limit on the “number of
machines that all Compact Tribes in the aggregate may license pursuant
to this Section . . . .” 1999 Compacts § 4.3.2.2(a)(1) (emphasis added).
CACHIL DEHE BAND v. CALIFORNIA 10175
ing licensing scheme at issue here rations a resource—
licenses for gaming devices—that is, if not for purely eco-
nomic considerations, effectively unlimited. Thus, for the rea-
soning of Makah to be at all relevant to this case, the State
would need to show that, despite not being inherently finite,
the resource of licenses for gaming devices is rendered at least
legally finite by operation of the terms of the 1999 Compacts.
As we have already explained, however, the statewide cap put
in place by the 1999 Compacts does not, without more, con-
strain the number of gaming licenses generally available in
California. Thus, the absent tribes have no legally protected
interest in the determination of the license pool that may be
issued under the 1999 Compacts.
[4] Finally, we also find it significant that, unlike the plain-
tiff in American Greyhound Racing, Colusa does not seek to
invalidate compacts to which it is not a party; this litigation
is not “aimed” at the other tribes and their gaming. Am. Grey-
hound Racing, 305 F.3d at 1026. On the contrary, Colusa
seeks to enforce a provision of its own Compact which may
affect other tribes only incidentally. Under the specific cir-
cumstances of this case, the Compact Tribes are not required
parties to the adjudication of Colusa’s challenge to the size of
the 1999 Compact license pool.12
Colusa’s Placement in Priority Tier IV
Colusa next challenges its placement in the fourth priority
tier since the December 2003 draw. The district court dis-
missed Colusa’s claim on the ground that the absent Compact
Tribes “would be deprived of th[eir gaming] licenses or the
12
We also are not persuaded by the State’s unexplained contention that
adjudication of Colusa’s challenge to the Commission’s determination of
the statewide cap would expose the State to a significant risk of “inconsis-
tent obligations” within the meaning of Rule 19. Should different district
courts reach inconsistent conclusions with respect to the size of the license
pool created under the 1999 Compacts, such inconsistencies could be
resolved in an appeal to this court.
10176 CACHIL DEHE BAND v. CALIFORNIA
opportunity to obtain those licenses.” This ruling was error,
for it misconstrues both the nature of the absent tribes’ inter-
est in the licenses that may be issued in the future and the
consequences of litigating Colusa’s challenge to its placement
in the fourth tier. It is true that, if one assumes that the license
pool is finite, an order to issue new licenses to Colusa may
render those licenses unavailable to the absent tribes, thereby
depriving them of their “opportunity” to obtain them. None-
theless, we conclude that the absent tribes’ interest in their
“opportunity” to obtain future licenses is insufficient to render
them “required” parties for Rule 19(a) purposes.
[5] Once again, it is necessary carefully to identify the
absent parties’ interest at stake. To the extent that the “oppor-
tunity” to obtain licenses means the entitlement to participate
in future rounds of draws, the litigation of Colusa’s tier
assignment will not “as a practical matter impair or impede
the [absent tribes’] ability to protect the interest.” Fed. R. Civ.
P. 19(a)(1)(B)(i). The absent tribes remain free to enter future
draws. The possible complaint of the absent tribes, however,
is that assignment of Colusa to a higher priority tier may
dilute the probability that the absent tribes will obtain the
licenses they apply for. But the absent tribes have no guaran-
tee against having to compete with any particular number of
tribes in their tier or a higher-priority tier. Nor can it be said
that any particular degree of likelihood of receiving licenses
“arises from terms in bargained contracts” and, more specifi-
cally, from the 1999 Compacts. Am. Greyhound Racing, 305
F.3d at 1023. Under IGRA, entering into a compact with state
authorities is, of course, a threshold requirement for Indian
tribes wishing to develop Class III gaming operations. See 25
U.S.C. § 2710(d)(1)(C). In that sense, if it were not for the
1999 Compacts, the absent tribes would have no likelihood of
ever obtaining any licenses. In our “practical” and “fact-
specific” Rule 19 inquiry, however, we require more than
mere “but-for” causation before recognizing a legally pro-
tected interest. Makah, 910 F.2d at 558; see also Bakia, 687
F.2d at 301. Here, in addition to the threshold requirement of
CACHIL DEHE BAND v. CALIFORNIA 10177
a compact, a number of other factors determine the actual
likelihood that any given tribe will receive any licenses. As
the facts of this litigation demonstrate, crucial among these
factors is the past, present and future demand for new licenses
by other tribes placed in higher or equal priority tiers. A tribe
wishing to obtain additional licenses has absolutely no control
over the overall demand for new licenses, or over the number
of tribes that may be placed in the same or a higher priority
tier. Thus, the causal connection between the terms of the
1999 Compacts and an absent tribe’s likelihood of obtaining
future licenses is attenuated indeed. See Makah, 910 F.2d at
558 (“speculation about a future event” does not give rise to
a legally protected interest). We therefore conclude that no
particular degree of likelihood of obtaining licenses “arises
from terms in bargained contracts,” Am. Greyhound Racing,
305 F.3d at 1023. As a consequence, the opportunity to obtain
licenses does not qualify as a legally protected interest for
Rule 19 purposes.
The interest of the absent tribes in Colusa’s tier assignment
is therefore quite different from the interest of the absent
tribes in American Greyhound Racing. In that case, we
emphasized that the gaming compacts between Arizona and
the Indian tribes, which were the subject of that litigation,
“provide[d] for automatic renewal if neither party gives the
requisite notice of termination. [That] provision [was] an inte-
gral part of the existing compacts, and was part of the bargain
that the tribes entered with the State.” Am. Greyhound Racing,
305 F.3d at 1023. We reversed the district court’s injunction
because it modified the compacts of the absent tribes and
stripped those tribes of the very object of their bargain—
automatic renewal unless the parties affirmatively terminated
the compacts. Id. Here, Colusa’s tier claim does not negate
any absent tribe’s right to its place in any tier, or its right to
participate in the manner guaranteed by the Compacts. Colu-
sa’s claim at most increases the competition for licenses to be
drawn but, as we have explained, the 1999 Compacts do not
guarantee freedom from competition, nor do they grant an
10178 CACHIL DEHE BAND v. CALIFORNIA
entitlement to draw any specific license or number of licenses
or even a predetermined place in line that may entail a partic-
ular likelihood of obtaining new licenses. Thus, American
Greyhound Racing does not control, because litigation of
Colusa’s claim for placement in a higher tier cannot impair
any Compact rights that were the object of the bargain of the
absent tribes.
[6] Different considerations apply to the interest of the
absent tribes in the licenses that they have already received.
We do not question that the Compact Tribes which requested
and obtained licenses in the December 2003 and subsequent
draws by placing ahead of Colusa have a legally protected
interest in those licenses. In order for the absent tribes to be
“required” parties under Rule 19, however, the State must
also show that their ability to protect their interest “may . . .
as a practical matter [be] impair[ed]” by the litigation of Colu-
sa’s claim to a higher tier placement. Fed. R. Civ. P. 19(a)(1)
(B)(i). To the extent that Colusa seeks prospective relief in the
form of a declaration that may place it in the third priority tier
in future draws, such relief, if granted, would not prejudice
the absent tribes’ legally protected interest in their existing
licenses.13 It was therefore an abuse of discretion for the dis-
trict court to prohibit Colusa from litigating the legality of the
Commission’s interpretation of the tier system. Like the
Makah court, however, we emphasize that “the scope of the
relief available [to Colusa] . . . is narrow.” Makah, 910 F.2d
at 559. Accordingly, to the extent Colusa seeks injunctive
relief requiring the Commission to restore Colusa to the posi-
tion it would have occupied under its claimed interpretation
of the Compact by issuing new licenses, such relief may be
13
The State’s contention that prospective relief is inapposite because
Colusa’s tier placement would be determined by a formula not available
to the other Compact Tribes is unavailing. As we explained, the 1999
Compacts do not create a legally protected interest in either freedom from
competition, see supra p. 10172-73, or a specific place in line in future
draws, see supra p. 10177-78.
CACHIL DEHE BAND v. CALIFORNIA 10179
granted only insofar as it does not interfere with the validity
or distribution of the licenses already assigned to the other
Compact Tribes.14
Colusa’s Pre-payment Fees
In its next claim, Colusa seeks restitution of the $403,750
it tendered to the Commission as pre-payment for the 323
licenses it has obtained in the draws thus far. The Commis-
sion, as trustee of the Revenue Fund, is holding the pre-
payment as a credit against future annual fees. Colusa argues
that the pre-payment should be refunded because Colusa will
not owe any annual fees until it draws at least 350 licenses—
an illusory prospect so long as the tribe is assigned to the
fourth priority tier.15 The district court dismissed the claim
because Colusa’s non-refundable pre-payment is deposited in
the Revenue Fund and, “to the extent that there is insufficient
money to pay each Non-Compact Tribe $1.1 million per year,
an award to plaintiff will lessen the amount of money distrib-
uted to each other tribe.” Thus the district court held that the
claim could not be litigated in the absence of the non-
Compact tribes eligible for distributions from the Fund.
14
We reject the State’s argument that, if Colusa prevailed on its first
claim that it was entitled to a higher tier placement, the entire license draw
process would have to be retroactively undone. Colusa does not seek this
remedy and we see no reason why a court of equity would be compelled
to grant it.
We also reject the State’s contention that “the other 1999 Compact
tribes, which have been placed in tiers based on the Commission’s inter-
pretation of the tier process, would nevertheless have suffered prejudice.”
The licenses that have already been issued comprise the absent tribes’ only
legally protected interest at stake. As we have made clear, however, none
of those licenses may be invalidated at the remedial stage.
15
The Tribe drew 250 licenses in September 2002, and another 73 in
October 2004, for a total of 323 licenses. Colusa represents that it will not
be permitted to draw any more licenses so long as it remains in a low-
priority tier.
10180 CACHIL DEHE BAND v. CALIFORNIA
[7] We need not decide whether the district court’s Rule
19(a) determination was correct. The State’s intervening
amendment and ratification of its 1999 Compacts with several
gaming tribes, which is memorialized in the 2007 Amended
Compacts, have significantly altered the financing of the Rev-
enue Fund. Four of the 2007 Amended Compacts that are now
in effect contain the following provision:
If it is determined that there is an insufficient amount
in the Indian Gaming Revenue Sharing Trust Fund
in a fiscal year to distribute the quarterly payments
pursuant to Government Code Section 12012.90 to
each eligible recipient Indian tribe, then the State
Gaming Agency shall direct a portion of the revenue
contribution in Section 4.3.1(b)(i) to increase the
revenue contribution to the Indian Gaming Revenue
Sharing Trust Fund in Section 4.3.2.2 in an amount
sufficient to ensure the Indian Gaming Revenue
Sharing Trust Fund has sufficient resources for each
eligible recipient Indian tribe to receive quarterly
payments pursuant to Government Code Section
12012.90.
E.g., Amendment to the Tribal-State Compact Between the
State of California and the Morongo Band of Mission Indians
§ II.B (Aug. 29, 2006), (amended § 4.3.1(l)). The “revenue
contribution” specified in amended section 4.3.1(b)(i) of these
four 2007 Amended Compacts, in turn, guarantees an annual
aggregate inflow to the State in excess of $140 million. See
2007 Amended Compacts § II.B (amended § 4.3.1(b)(i)).
Should a shortfall develop in the Revenue Fund, the Commis-
sion “shall” direct a sufficient portion of this amount to the
Revenue Fund to make up for the shortfall. The potential
backfill of more than $140 million per year guaranteed by the
2007 Amended Compacts appears as a practical matter to be
more than sufficient to make up for any shortfall in the Reve-
nue Fund.16 We therefore conclude that the refund of Colusa’s
16
As of September 20, 2007, 71 Indian tribes were eligible to receive the
$1.1-million annual distribution from the Revenue Fund. See, e.g., Califor-
CACHIL DEHE BAND v. CALIFORNIA 10181
$403,750 pre-payment fee, if appropriate under the Compact,
will not “as a practical matter impair or impede [the Non-
Compact Tribes’] ability to protect [their] interest” in receiv-
ing their annual $1.1-million distribution as required by Cali-
fornia state law. Fed. R. Civ. P. 19(a)(1)(B)(i).17
In the alternative, the State contends that the Compact
Tribes are also required parties to the pre-payment fee claim.
It argues that Colusa’s success in obtaining its refund would
impair the Compact Tribes’ ability to protect their interest in
“the 1999 Compact’s interpretation and the fulfillment of its
terms by all 1999 Compact tribes.” The State’s argument
sweeps much too broadly. Nothing in the Compact establishes
any obligation towards the other Compact Tribes insofar as
the payment or refundability of Colusa’s advance fees into the
Revenue Fund are concerned.18 With respect to the pre-
payment provision, the 1999 Compacts are quintessentially
bilateral. Accordingly, the Compact Tribes’ relevant Rule 19
interest must arise, if at all, from the bare fact that the Com-
pact Tribes are simultaneously parties to identical bilateral
compacts with the State. We have never held that the mere
coincidence of parallel and independent contractual obliga-
tions vis-a-vis a common party requires joinder of all simi-
nia Gambling Control Commission, Revenue Sharing Trust Fund Recipi-
ents (Sept. 20, 2007), available at http://www.cgcc.ca.gov/
rstfi/2008/DistribFundReport020503%20% 20-%2 003312008.pdf (last
visited July 31, 2008).
17
We reject the State’s argument that “actual implementation (which is
not described in [the 2007 Compacts]) could result in delayed reimburse-
ment” to the Non-Compact Tribes. Rule 19 requires “more than specula-
tion about a future event.” Makah, 910 F.2d at 558 (citations omitted).
18
It is true that, under the Compact, Colusa “agree[d] with all other
Compact Tribes . . . that each Non-Compact Tribe in the State shall
receive the sum of $1.1 million per year.” 1999 Compacts, § 4.3.2.1(a)
(emphasis added). No reciprocal obligation to contribute any specific
amount or forgo otherwise legitimate claims to the pre-payment fees, how-
ever, arises from this joint commitment.
10182 CACHIL DEHE BAND v. CALIFORNIA
larly situated parties. Cf. Dawavendewa v. Salt River Project
Agric. Improvement & Power Dist., 276 F.3d 1150, 1157 (9th
Cir. 2002) (“[A] party to a contract is necessary, and if not
susceptible to joinder, indispensable to litigation seeking to
decimate that contract.”) (emphasis added). The mutuality-of-
party requirement of res judicata and defensive collateral
estoppel ensures that the similarly situated absent tribes will
not be prejudiced if and when they decide to challenge the
Commission’s interpretation of the refund provision of the
1999 Compacts.19 On the facts of this case, we decline the
State’s invitation to extend the scope of mandatory joinder.
[8] Finally, we reject the State’s argument that failure to
join the Compact Tribes may expose the State to inconsistent
obligations. As the First Circuit has cogently explained,
“[i]nconsistent obligations” are not . . . the same as
inconsistent adjudications or results. Inconsistent
obligations occur when a party is unable to comply
with one court’s order without breaching another
court’s order concerning the same incident. Inconsis-
tent adjudications or results, by contrast, occur when
a defendant successfully defends a claim in one
forum, yet loses on another claim arising from the
same incident in another forum.
Delgado v. Plaza Las Americas, Inc., 139 F.3d 1, 3 (1st Cir.
1998) (per curiam) (footnote and citations omitted); see also
4 James Wm. Moore et al., Moore’s Federal Practice-Civil
19
We also note that the State’s contention that Colusa’s success would
impair “the fulfillment of [the 1999 Compacts’] terms by all Compact
tribes” is vitiated by its circular reasoning. If Colusa succeeds in its claim,
it will obtain relief that will, by definition, “fulfill” the pre-payment term
of the Compact. In other words, the only “fulfillment” that Colusa’s claim,
if successful, would impair is that of the Commission’s current interpreta-
tion of the provision. The Compact Tribes, however, have no “legally pro-
tected” interest in the “fulfillment” of the Commission’s particular
interpretation of the Compact.
CACHIL DEHE BAND v. CALIFORNIA 10183
§ 19.03[4][d] (2008). We adopt the approach endorsed by the
First Circuit. Accordingly, the possibility that the State may
have to refund Colusa’s pre-payment fees while adhering to
a different interpretation of the Compact in its dealings with
some other tribes does not, without more, rise to the level of
creating a “substantial risk” of incurring “inconsistent obliga-
tions.” Fed. R. Civ. P. 19(a)(1)(B)(ii).
The Commission’s Authority to Conduct Rounds of
Draws
Colusa finally argues that the Commission lacks authority
under the compact unilaterally to conduct draws of gaming
device licenses. As relief, Colusa requests a declaration that
the Commission “has no authority under the Compact unilat-
erally to administer the system established under the Compact
for the issuance of Gaming device licenses, but only to do so
in consultation with the Tribe.” The district court concluded
that, if Colusa “prevailed, the relief would deprive absent par-
ties of their legal entitlements to the licenses awarded pursu-
ant to an invalid process.” We reverse the district court’s
determination because it is contrary to our decision in Makah.
[9] In Makah, we held that the absent tribes were not
required parties to the adjudication of the plaintiff tribe’s
“procedural claims”—its claim that the harvest quotas
imposed by the Secretary of Commerce “were the product of
commitments made outside the administrative process.”
Makah, 910 F.2d at 557 (internal quotation marks omitted).
We reasoned that “[t]he absent tribes would not be prejudiced
because all of the tribes have an equal interest in an adminis-
trative process that is lawful.” Id. at 559. In so holding, we
also made clear that Rule 19 required “the scope of the relief
available to the Makah on their procedural claims [to be] nar-
row” and limited to prospective relief. Id. We find this reason-
ing dispositive in this case as well. Much like their
counterparts in Makah, the absent tribes “have an equal inter-
est in an administrative process that is lawful,” id.—that is,
10184 CACHIL DEHE BAND v. CALIFORNIA
that the Commission not conduct the draws of licenses ultra
vires. Moreover, as we have already made clear, Rule 19 nec-
essarily confines the relief that may be granted on Colusa’s
claims to remedies that do not invalidate the licenses that have
already been issued to the absent Compact Tribes. See Makah,
910 F.2d at 559. Thus, we reverse the district court’s dis-
missal of Colusa’s fourth claim, albeit with the proviso that,
were Colusa to prevail on the merits, no existing license may
be invalidated at the remedial stage.20
CONCLUSION
We affirm the district court’s judgment dismissing Colusa’s
claim for failure to negotiate in good faith. We reverse the
district court’s judgment dismissing Colusa’s other claims on
the pleadings, and remand for further proceedings consistent
with this opinion. Colusa is entitled to its costs on appeal.
AFFIRMED IN PART; REVERSED AND
REMANDED IN PART.
20
We reject the State’s contention that, if Colusa prevailed in establish-
ing its fourth claim, the existing licenses would necessarily be void ab ini-
tio. It is true that, in Lockyer v. City and County of San Francisco, the
Supreme Court of California held that marriage licenses issued by the City
of San Francisco to same-sex couples in violation of state law were “void
and of no legal effect from their inception.” 33 Cal. 4th 1055, 1113
(2004). In that case, however, the Supreme Court of California empha-
sized the “unusual, perhaps unprecedented, set of circumstances” sur-
rounding the invalidation of the marriage licenses in question. Id.
Moreover, in reaching its conclusion, the court relied exclusively on the
relevant provisions of California’s Family Code and on case law address-
ing specifically marriages celebrated in violation of state law. Id. at 1113-
14. Thus, Lockyer is not controlling. The parties have directed our atten-
tion to no other case—and we could find none—in support of the proposi-
tion that, under California law, the district court may not limit relief to
future conduct if Colusa prevailed on the merits of its claim.