Fmc Corporation v. Shoshone-Bannock Tribes ( 2019 )

FOR PUBLICATION
UNITED STATES COURT OF APPEALS
FOR THE NINTH CIRCUIT
FMC CORPORATION, Nos. 17-35840
Plaintiff-Appellant/ 17-35865
Cross-Appellee,
D.C. No.
v. 4:14-cv-00489-BLW
SHOSHONE-BANNOCK
TRIBES, OPINION
Defendant-Appellee/
Cross-Appellant.
Appeal from the United States District Court
for the District of Idaho
B. Lynn Winmill, Chief District Judge, Presiding
Argued and Submitted May 17, 2019
Seattle, Washington
Filed November 15, 2019
Before: Michael Daly Hawkins and William A. Fletcher,
Circuit Judges, and David C. Bury,* District Judge.
Opinion by Judge W. Fletcher
*
The Honorable David C. Bury, United States District Judge for the
District of Arizona, sitting by designation.
2 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
SUMMARY**
Tribal Court Jurisdiction
The panel affirmed the district court’s judgment enforcing
a judgment of the Shoshone-Bannock Tribal Court of
Appeals, which ruled that FMC Corporation must pay an
annual use permit fee for storage of hazardous waste on fee
lands within the Shoshone-Bannock Fort Hall Reservation, as
required under a consent decree settling a prior suit brought
against FMC by the Environmental Protection Agency under
the Resource Conservation and Recovery Act.
The panel held that the tribal court had regulatory and
adjudicatory jurisdiction over the Shoshone-Bannock Tribes’
suit against FMC under two “Montana exceptions.” Under
the first exception, a tribe may regulate the activities of
nonmembers who enter into consensual relationships with the
tribe or its members. Under the second Montana exception,
a tribe retains inherent power to exercise civil authority over
the conduct of non-Indians on fee lands within its reservation
when that conduct threatens or has some direct effect on the
political integrity, the economic security, or the health or
welfare of the tribe. The panel held that, under the first
Montana exception, the Tribes had regulatory jurisdiction to
impose the permit fees because FMC entered into a
consensual relationship when it signed a permit agreement
with the Tribes. The panel held that FMC’s conduct of
storing hazardous waste on its fee lands within the reservation
fell within the second Montana exception. The panel held
**
This summary constitutes no part of the opinion of the court. It has
been prepared by court staff for the convenience of the reader.
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 3
that the district court erred in refusing, as a matter of comity,
to enforce the judgment of the Tribal Court of Appeals under
the second exception. The panel held that, in addition to
regulatory jurisdiction, the Tribes had adjudicatory
jurisdiction.
The panel also held that the Tribal Court of Appeals did
not deny FMC due process through a lack of impartiality.
COUNSEL
Gregory G. Garre (argued), Elana Nightingale Dawson, and
Genevieve P. Hoffman, Latham & Watkins LLP,
Washington, D.C.; Ralph H. Palumbo, Yarmuth Wilsdon
PLLC, Seattle, Washington; Lee Radford, Parsons Behle &
Latimer, Idaho Falls, Idaho; Maureen L. Mitchell, Fox
Rothschild LLP, Seattle, Washington; for Plaintiff-
Appellant/Cross-Appellee.
Douglas B. L. Endreson (argued) and Frank S. Holleman,
Sonosky Chambers Sachse Endreson & Perry LLP,
Washington, D.C.; William F. Bacon, Shoshone-Bannock
Tribes, Fort Hall, Idaho; Paul C. Echo Hawk, Echo Hawk
Law Office, Pocatello, Idaho; for Defendant-Appellee/Cross-
Appellant.
4 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
OPINION
W. FLETCHER, Circuit Judge:
For over 50 years, FMC Corporation (“FMC”) operated
an elemental phosphorus plant on fee land within the
Shoshone-Bannock Fort Hall Reservation (“Reservation”) in
Idaho. FMC’s operations produced approximately 22 million
tons of hazardous waste that is currently stored on the
Reservation. The waste is radioactive, carcinogenic, and
poisonous.
In 1990, the U.S. Environmental Protection Agency
(“EPA”) declared FMC’s plant and storage area, together
with an adjoining off-reservation plant owned by J.R.
Simplot, a Superfund Site under the Comprehensive
Environmental Response, Compensation and Liability Act
(“CERCLA”). In 1997, the EPA further charged FMC with
violating the Resource Conservation and Recovery Act
(“RCRA”). A Consent Decree settling the RCRA suit
required FMC to obtain permits from the Shoshone-Bannock
Tribes (“the Tribes”). FMC and the Tribes negotiated an
agreement under which FMC agreed to pay $1.5 million per
year for a tribal use permit allowing storage of hazardous
waste. FMC paid the annual use permit fee from 1998 to
2001 but refused to pay the fee in 2002 after ceasing active
plant operations. FMC has continued to store the hazardous
waste on the Reservation despite its failure to pay the use
permit fee.
The Tribes sued FMC in Tribal Court, seeking inter alia
payment of the annual $1.5 million use permit fee for waste
storage. Under Montana v. United States, 450 U.S. 544
(1981), there are two potentially relevant bases for tribal
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 5
jurisdiction in this case—two of the three so-called “Montana
exceptions.” First, “[a] tribe may regulate, through taxation,
licensing, or other means, the activities of nonmembers who
enter consensual relationships with the tribe or its members,
through commercial dealing, contracts, leases, or other
arrangements.” Id. at 565. Second, “[a] tribe may also retain
inherent power to exercise civil authority over the conduct of
non-Indians on fee lands within its reservation when that
conduct threatens or has some direct effect on the political
integrity, the economic security, or the health or welfare of
the tribe.” Id. at 566. After years of litigation, the Tribal
Court of Appeals held in 2014 that the Tribes have regulatory
and adjudicatory jurisdiction over FMC under both Montana
exceptions. The court held that FMC owed $19.5 million in
unpaid use permit fees for hazardous waste storage from 2002
to 2014, and $1.5 million in annual fees going forward.
After the decision of the Tribal Court of Appeals, FMC
sued the Tribes in federal district court. FMC argued that the
Tribes did not have jurisdiction under either of the Montana
exceptions; that the Tribal Court of Appeals denied FMC due
process because two judges on the Tribal Court of Appeals
were biased against FMC; and that the judgment by the Tribal
Court of Appeals was unenforceable. The Tribes
counterclaimed, seeking an order recognizing and enforcing
the judgment of the Tribal Court of Appeals. The district
court held that the Tribes had regulatory and adjudicatory
jurisdiction under both Montana exceptions, that the Tribal
Court of Appeals had not denied FMC due process, and that
the Tribal Court of Appeals’ judgment was entitled to comity,
and was therefore enforceable, under the first but not the
second Montana exception.
6 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
FMC appeals the district court’s judgment in favor of the
Tribes. The Tribes cross-appeal the district court’s decision
that the Tribal Court of Appeals’ judgment is not enforceable
under the second Montana exception.
We affirm the judgment of the district court. We hold
that the judgment of the Tribal Court of Appeals is
enforceable under both Montana exceptions.
I. Factual and Procedural Background
The Shoshone-Bannock Tribes are a federally recognized
Indian tribe comprising the eastern and western bands of the
Northern Shoshone and the Bannock, or Northern Paiute,
bands. The Tribes are organized under the Indian
Reorganization Act of 1934, 25 U.S.C. §§ 5101 et seq., and
are governed by the Fort Hall Business Council, a legislative
body consisting of seven elected members.
Shoshone-Bannock Tribes, Tribal Government,
http://www2.sbtribes.com/government (last visited Sept. 19,
2019). The ancestral lands of the Tribes included land in
present-day Idaho, Oregon, Nevada, Utah, Wyoming,
Montana, and parts of Canada. See Shoshone-Bannock
Tribes, http://www2.sbtribes.com/about (last visited Sept. 19,
2019). Pursuant to the Fort Bridger Treaty of 1868, 15 Stat.
673, and related executive orders, the Tribes today have
sovereign authority over the Fort Hall Reservation. The Fort
Hall Reservation originally encompassed approximately
1.8 million acres, or 2,800 square miles. See id. The
Reservation now encompasses approximately 544,000 acres,
or 840 square miles, in what is now southeastern Idaho.
Ninety-seven percent of the Reservation is tribal land or land
held in trust by the United States for the benefit of the Tribes
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 7
and their members. Approximately three percent of the
Reservation is fee land owned by non-members.
A. FMC’s Phosphorus Plant, Consent Decree, and Permit
Fees
From 1949 to 2001, FMC Corporation and its
predecessors owned and operated an elemental phosphorus
production plant occupying 1,450 acres. Virtually all of the
property is fee land on the Fort Hall Reservation. FMC’s
plant was the largest elemental phosphorus plant in the world.
FMC Idaho, Plant History, http://fmcidaho.com/plant-history
(last visited Sept. 19, 2019). For most of its operation, FMC
obtained or mined raw materials for its plant from tribal and
allottee lands on the Reservation. See, e.g., id.
Hazardous waste from the plant’s 52 years of operation
contaminates FMC’s land on the Reservation. Approximately
22 million tons of hazardous waste are stored in waste storage
ponds on the site. Some storage ponds are capped. Some are
not. Some ponds are lined. Some are not. Phosphorus,
arsenic, and other hazardous materials contaminate an
additional 1 million tons of loose soil and groundwater
throughout the site. Millions of tons of slag containing
radioactive materials contaminate the site. Somewhere
between twenty one and thirty railroad tanker cars containing
toxic phosphorous sludge are buried on the property. There
is no lining underneath the tanker cars and no cap above
them. As will be described in greater detail below, the
hazardous waste in the storage ponds, tanker cars, soil,
groundwater, and air at the site is radioactive, carcinogenic,
and poisonous.
8 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
In 1990, EPA declared the FMC plant, as well as an
adjoining off-reservation plant owned by a different
company, J.R. Simplot, as a National Priority List
Superfund Site—the “Eastern Michaud Flats” site—under
CERCLA. See 55 Fed. Reg. 35502, 35507. The National
Priorities List is a list of the nation’s “worst hazardous
waste sites.” EPA, Superfund Cleanup Process,
https://www.epa.gov/superfund/superfund-cleanup-process
(last visited Sept. 19, 2019).
In 1997, EPA charged FMC with violating RCRA.
RCRA regulates the disposal of solid and hazardous waste.
To avoid litigation, FMC began negotiations with the EPA
over the terms of a possible Consent Decree that would settle
the RCRA suit. Though not a formal party, the Tribes
participated in the negotiations. Among other measures, the
proposed RCRA Consent Decree required construction of a
treatment facility and additional waste storage ponds on
FMC’s fee land on the Reservation. As a condition to
obtaining the Consent Decree, the EPA required FMC to
obtain relevant permits from the Tribes. See Consent Decree,
Case No. 4:98-cv-00406-BLW (D. Idaho, July 13, 1998).
Pursuant to the Tribes’ Land Use Policy Ordinance
(“LUPO” or “Ordinance”) and associated Guidelines, the
relevant tribal permits included a building permit for
construction of the treatment facility and waste storage ponds,
and a use permit for storage of the hazardous waste. FMC
and the Tribes met in July 1997 to discuss the permits.
During negotiations, FMC consented to tribal jurisdiction.
See, e.g., Letter from the Land Use Policy Commission to
FMC (Aug. 6, 1997) (stating that following the July meeting,
“We understood that FMC would recognize tribal jurisdiction
within the exterior boundaries of the Fort Hall Indian
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 9
Reservation.”); Letter from J. Paul McGrath, Senior Vice
President and General Counsel and Secretary of FMC, to the
Fort Hall Business Council, Shoshone-Bannock Tribes
(Oct. 30, 1997) (stating “[i]n connection with the land use
permit, we did agree that we would consent to tribal
jurisdiction in that area”). FMC applied for the building and
use permits in August 1997.
While negotiations were proceeding, the Tribes
considered and then adopted amended LUPO Guidelines for
storage of hazardous waste on the Reservation. The Tribes
finalized the amended Guidelines in April 1998. The
amended Guidelines required an annual use permit for storage
of hazardous waste on the Reservation, with an annual fee of
$5.00 per ton. Money from use permit fees was to be
“deposited in the Shoshone-Bannock Hazardous Waste
Management Program Fund,” and to be used “to pay the
reasonable and necessary costs of administrating the
Hazardous Waste Management Program.” Amendments to
Chapter V: Fort Hall Land Use Operative Policy Guidelines,
§ V-9-2(B) (1998).
The Land Use Policy Commission (“LUPC” or
“Commission”), the Tribes’ administrative and enforcement
body for the Ordinance, notified FMC of the amended
Guidelines. FMC estimated that the $5 per ton storage fee
would cost over $110 million per year. FMC sought to
negotiate a compromise with the Tribes. FMC Corp. v.
Tribes, No. 4:14-CV-489-BLW, 2017 WL 4322393, at *2
(D. Idaho Sept. 28, 2017).
In May and June 1998, the Tribes and FMC negotiated an
agreement under which FMC agreed to a one-time fee of
$1 million and an annual use permit fee of $1.5 million to
10 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
cover FMC’s storage of its hazardous waste on the
Reservation. See Letter from LUPC to FMC (May 19, 1998).
The parties agreed that FMC was required to obtain a use
permit and to pay the $1.5 million fee even if FMC capped
and closed the eleven hazardous waste ponds that were
subject to the RCRA Consent Decree (the “RCRA ponds”).
See id. (stating that FMC agreed to pay the annual use permit
fee “beginning on June 1, 1999, and for every year
thereafter”); Letter from J. Paul McGrath, Senior Vice
President and General Counsel and Secretary of FMC, to
LUPC (June 2, 1998) (“[I]t is our understanding that the
permit covers the plant and that the $1.5 million annual fee
would continue to be paid for the future even if the use of
ponds 17–19 was terminated in the next several years.”);
Affidavit of Robert J. Fields, Division Manager of FMC
(Oct. 20, 2000) (stating that he participated in the
negotiations with the Tribes and that the June 2, 1998 letter
from FMC was intended to confirm FMC’s shared
understanding that the use permit covered the entire facility
and that FMC’s agreement to pay $1.5 million per year would
not end when Ponds 17, 18 and 19 were closed pursuant to
the Consent Decree). FMC paid its first fee on June 1, 1998.
A few months later, FMC and the EPA agreed to a
Consent Decree to settle the RCRA suit. FMC Corp. v.
Tribes, 2017 WL 4322393 at *3. Paragraph 8 of the Consent
Decree memorialized the Decree’s requirement that FMC
obtain permits from the Tribes: “Where any portion of the
Work requires a . . . tribal permit or approval, [FMC] shall
submit timely and complete applications and take all other
actions necessary to obtain all such permits or approvals.”
See Consent Decree, No. 4:98-CV-00406-BLW, ¶ 8 (D. Idaho
July 13, 1998).
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 11
Pursuant to the Consent Decree, FMC agreed to pay a fine
to the U.S. government of $11.9 million, to install a range of
upgrades in its handling of waste, and to cap nine of the
eleven RCRA ponds covered by the Consent Decree. FMC
Corp. v. Tribes, 2017 WL 4322393 at *3. Between 1999 and
2005, FMC capped and/or closed the RCRA ponds. Id. at *4.
In 2005, FMC certified that the last of the RCRA ponds had
been capped and/or closed.
B. Prior Federal Court Proceedings
From 1998 to 2001, FMC paid the Tribes the annual use
permit fee of $1.5 million pursuant to its 1998 agreement
with the Tribes. In December 2001, FMC stopped all active
phosphorus processing operations at the site. When the
$1.5 million use permit fee came due in 2002, FMC refused
to pay it.
After negotiations failed, the Tribes filed a motion in the
RCRA Consent Decree action in federal district court,
seeking a declaration that FMC was required by the Consent
Decree to obtain tribal permits for waste storage on the
Reservation. Id. The district court held that “(1) the Tribes
had jurisdiction over FMC under the first Montana exception
. . . , (2) FMC was required to apply for Tribal permits based
on FMC’s agreement to submit to tribal jurisdiction in ¶ 8 of
the RCRA Consent Decree, (3) the Tribes were intended
third-party beneficiaries of the Consent Decree and therefore
had a right to enforce its terms, and (4) FMC was required to
exhaust tribal remedies over any challenges to the Tribal
permit decisions.” FMC Corp. v. Tribes, 2017 WL 4322393
at *4; see United States v. FMC, No. CV-98-0406-E-BLW,
2006 WL 544505 (D. Idaho 2006).
12 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
On appeal from the district court, we addressed only the
third of the district court’s holdings. We held that the Tribes
were incidental rather than intended beneficiaries of the
Consent Decree and therefore had no right to judicial
enforcement of the Decree. United States v. FMC, 531 F.3d
813, 815 (9th Cir. 2008). We remanded to the district court
with instructions to dismiss the Tribes’ suit. Id. at 824.
However, we noted that during the pendency of the appeal to
our court “FMC began the process of applying for tribal
permits, which is the main relief that the Tribes have sought
in this action.” Id. at 823. We explicitly noted and relied on
a representation by FMC. We wrote:
At oral argument, the Tribes expressed their
concern that, if we were to hold that the
Tribes lack standing to enforce the Consent
Decree, FMC would withdraw its permit
applications and undo the progress made to
date on the proper resolution of this dispute.
In response to questioning from the panel,
FMC’s lawyer represented to the court that
FMC understands that it has the obligation to
continue, and will continue, with the current
tribal proceedings to their conclusion. We
accept that statement from counsel as binding
on FMC.
Id. at 823–24.
C. Tribal Proceedings
In 2006, after entry of the district court’s order but while
FMC’s aforementioned appeal to our court was still pending,
FMC applied to the Tribes’ Land Use Policy Commission for
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 13
a building permit for demolition activities and a use permit
for continued storage of the waste. Following notice and a
public hearing, the Commission granted FMC’s applications
for the two permits. See Findings of Fact and Decision on
FMC Application for Building Permit for Activities at the
FMC Pocatello Plant (Land Use Policy Commission, Apr. 25,
2006); Findings of Fact and Decision on FMC Application
for Special Use Permit for Activities at the FMC Pocatello
Plant (Land Use Policy Commission, Apr. 25, 2006). The
Commission concluded that it had regulatory jurisdiction
under both Montana exceptions to require FMC to obtain the
permits. The Commission assessed a one-time building
permit fee at $3,000 for demolition activities during that year.
The Commission also assessed FMC’s use permit fee for
storage of hazardous waste at the previously agreed
$1.5 million annual rate. The Commission provided, as an
alternative, that FMC could choose to pay the higher $5 per
ton fee based on the weight of the waste stored on FMC’s
property on the Reservation, pursuant to the Tribes’ amended
Guidelines. Id.
FMC appealed the Commission’s decision to the
governing body of the Tribes, the Fort Hall Business Council
(“Council”). On July 21, 2006, the Council affirmed the
Commission’s decision. Fort Hall Business Council Decision
Regarding FMC’s Appeals of the April 25, 2006 Land Use
Permit Decisions (July 21, 2006). On February 8, 2007, the
Commission issued a “letter resolution” setting the use permit
fee at the agreed-upon $1.5 million. FMC again appealed the
Commission’s decision to the Council. On June 14, 2007, the
Council affirmed the Commission’s decision.
FMC appealed the Council’s and the Commission’s
decisions to the Tribal Court. (The Shoshone-Bannock tribal
14 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
court system consists of a trial court and an appellate
court—the “Tribal Court”and the “Tribal Court of Appeals.”)
The Tribal Court held inter alia that, pursuant to the Tribes’
laws, the Tribes were required to submit their Land Use
Policy Guidelines and the Hazardous Waste Management Act
of 2001, upon which the tribal use permit requirement was
premised, to the Secretary of the Interior for approval. FMC
Corp. v. Shoshone-Bannock Tribes’ Fort Hall Business
Council and Land Use Policy Commission, Case Nos. C-06-
0069, C-07-0017, C-07-0035 (Shoshone-Bannock Tribal
Court, Civil Division, May 21, 2008). The Tribal Court
found that the Guidelines and the Act had not been approved
by the Secretary of the Interior, and therefore, were
unenforceable as a matter of tribal law.
In June 2008, the Tribes and FMC cross-appealed to the
Tribal Court of Appeals. The members of that court were
Judges Fred Gabourie, Mary Pearson, and Cathy Silak. None
of them is a member of the Shoshone-Bannock Tribes. Judge
Gabourie is a former California state court judge, former
Chief Judge for the Kootenai Tribe of Idaho, and a former
prosecutor and city attorney. Judge Pearson is a former Chief
Judge for the Spokane Tribe and the Coeur d’Alene Tribe.
Judge Silak is a former Justice of the Idaho Supreme Court.
1. Conference Remarks by Judges Gabourie and Pearson
While the case was pending before the Tribal Court of
Appeals, Judges Gabourie and Pearson spoke at a conference
entitled “Tribal Courts: Jurisdiction and Best Practices”
convened by the University of Idaho College of Law on
March 23, 2012. In the audience were law students, tribal
court practitioners, other lawyers, and members of the public.
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 15
The conference was videotaped. FMC’s counsel attended the
judges’ presentation.
Judge Gabourie described the manner in which tribal
appellate court decisions come before federal courts, and he
noted that very few federal court judges have experience with
tribes. He stated that “every court has—should be impartial”
and “a good opinion comes [from] both sides, both parties.
Because both parties rely on a good opinion, strong opinion.”
He stated that a tribal appellate court decision should discuss
the tribe’s tradition and culture so that judges in the federal
system have some context when they read the decision. He
stated that an appellate judge has a responsibility to remand
the case for testimony from expert witnesses if there is a
weakness in the record. He discussed limitations on tribes’
sovereign powers under current law, and how, in light of
Supreme Court decisions like Montana, “which has just been
murderous to Indian tribes,” it is important for tribes to
support good appellate courts that can issue strong opinions
in the event issues are heard in a federal court. He discussed
Nevada v. Hicks, 533 U.S. 353 (2001), and Strate v. A-1
Contractors, 520 U.S. 438 (1997), noting that the tribal
appellate court decisions had not been good, and that, as a
result, the U.S. Supreme Court did not have vital information
about the tribes’ cultures and traditions.
Judge Pearson discussed the importance of tribal
attorneys creating a record at the tribal trial court level. She
stated tribal attorneys should involve the tribe in the “big
cases.” She noted that they had a big case at that moment that
they knew was “going to go up,” so they were saying prayers,
reading cases, and “trying to do . . . the history.” She
described Bugenig v. Hoopa Valley Tribe, 266 F.3d 1201 (9th
Cir. 2001), as a case where the tribal lawyers had effectively
16 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
laid out the history for the tribal trial and appellate courts.
She discussed the importance of this responsibility—how
“[you] just need to make sure that you do the job
right”—since non-Indian federal judges were reviewing the
decisions.
In response to questions, Judge Gabourie discussed the
value of anthropologists and scientists testifying in tribal
court cases. He stated that the use of experts in Bugenig was
a model for tribes seeking to protect their sovereignty,
traditions, and cultures. Expanding on his earlier discussion
of experts, Judge Gabourie stated:
You know, there’s one area, too, there are
tribes that have had mining and other
operations going on, on the reservation, you
know, and then the mining company or
whatever, manufacturing company,
disappears. They leave, you know. They’ve
. . . either dug everything they could, and then
the ground is disturbed, sometimes polluted
beyond repair. And you sit as . . . an appellate
court justice, and you’re starting to read the
cases that come down from the tribal court.
And you’re saying to yourself, you know, we
know that . . . there’s pollution, that the food
that they’re eating is polluted, the water’s
polluted, but nobody proved it. And while
John Jones said that it is polluted, you know,
John Jones don’t count. But the tribal courts
have got to realize that you need expert
witnesses. You need chemists and whatever
to get out of testifying. It may cost a little, but
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 17
so the appellate court is in a position of
remanding that case back and say “do it.”
You know, you made—and you’re really
being fair to both sides. . . . That’s why you
need the expert witnesses to cover those loose
ends, you know, so when it finally goes to
the—whatever circuit it may go to, they can
see that there’s been some experts testifying
on behalf. Maybe experts that testify on
behalf of the mining company, but experts
nonetheless. Well, you can be damn sure that
the mining company’s going to spend the
money to protect their interest, you know.
So the appellate courts have got to step in and
in their own way, make a good, balanced
decision, a hundred-percenter for both sides,
but be sure to protect the tribe. And that’s my
own opinion, that last sentence.
Judge Pearson clarified, “We’re not guaranteeing anybody
anything.” Judge Pearson advised the audience:
Well, I encourage you to get the Bugenig
handouts, because it’s really important. If
you’re a law student and you’re going to
practice law, as well as if you’re a judge and
you’re going to be hearing cases, you know
where—companies come on the reservations
and do business for X number of years and
they dirty up your groundwater and your other
things, and they go out of business. And they
leave you just sitting. And you need to know
18 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
what you can do as you’re sitting as a judge
with those cases coming toward you.
2. Decisions of the Tribal Court of Appeals
Just over a month later, on May 8, 2012, the Tribal Court
of Appeals issued an opinion holding inter alia that (1) the
Tribes have regulatory and adjudicatory jurisdiction over
FMC under the first Montana exception to require FMC to
obtain a building permit for demolition and construction, and
a use permit for hazardous waste storage, and to require FMC
to pay the agreed-upon annual use permit fee of $1.5 million;
(2) the use permit fee was authorized by and enforceable
under tribal law, because, inter alia, the Land Use Policy
Ordinance and the Hazardous Waste Management Act were
both approved by the Secretary of the Interior consistent with
tribal law; and (3) the Tribal Court erred in failing to consider
whether the Tribes have jurisdiction under the second
Montana exception. The court issued an amended order on
June 26, 2012. FMC Corp. v. Shoshone-Bannock Tribes
Land Use Dep’t and Fort Hall Bus. Council, Amended, Nunc
Pro Tunc Findings of Fact, Conclusions of Law, Opinion and
Order, Case Nos. C-06-0069, C-07-0017, C-07-0035
(Shoshone-Bannock Tribal Court of Appeals, June 26, 2012)
(“Tribal Court of Appeals, June 2012 Opinion”).
On January 10, 2013, pursuant to a state-court order under
the Idaho Public Records Act, FMC obtained a videotape of
Judges Gabourie and Pearson’s remarks at the law school
conference. In April 2013, Judges Peter McDermott and
Vern Herzog Jr. replaced Judges Gabourie and Pearson on the
Tribal Court of Appeals. Judge McDermott is a retired Idaho
state district court judge. Judge Herzog is a practicing
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 19
attorney. Neither is a member of the Shoshone-Bannock
Tribes. Judge Silak remained on the court.
On May 6, 2013, FMC filed briefs asking the
reconstituted Tribal Court of Appeals to reconsider its prior
rulings on the ground that the statements by Judges Gabourie
and Pearson showed bias against FMC. In an order dated
May 28, 2013, the Tribal Court of Appeals revised its earlier
ruling on an issue unrelated to the questions now before us.
It upheld its earlier rulings on all other issues. The court
ordered an evidentiary hearing to resolve the question
previously left open—whether the Tribes had regulatory and
adjudicatory jurisdiction over FMC under the second
Montana exception.
From April 1 to April 15, 2014, the Tribal Court of
Appeals held an evidentiary hearing on the second Montana
exception. Judge Silak was not available for the hearing.
Judge John Traylor replaced Judge Silak. Judge Traylor is a
practicing attorney. He is not a member of the Shoshone-
Bannock Tribes. Judges McDermott and Herzog remained on
the court. Following the hearing, the Tribal Court of Appeals
made factual findings and held that the Tribes had regulatory
and adjudicatory jurisdiction under the second Montana
exception. See Shoshone-Bannock Tribes Land Use Dep’t
and Fort Hall Bus. Council v. FMC Corp., Opinion, Order,
Findings of Facts and Conclusions of Law (Shoshone-
Bannock Tribal Court of Appeals, May 16, 2014) (“Tribal
Court of Appeals, May 2014 Opinion”); see also Shoshone-
Bannock Tribes Land Use Dep’t and Fort Hall Bus. Council
v. FMC Corp., Statement of Decision (Shoshone-Bannock
Tribal Court of Appeals, Apr. 15, 2014) (“Tribal Court of
Appeals, Statement of Decision”).
20 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
In 2012, prior to the decision of the Tribal Court of
Appeals, the EPA had issued an Interim Amendment to the
Record of Decision (“IRODA”) under CERCLA addressing
the FMC Operable Unit (“OU”) of the Eastern Michaud Flats
Superfund Site. See EPA, Interim Amendment to the Record
of Decision for the EMF Superfund Site, FMC Operable Unit,
Pocatello, Idaho (Sept. 2012) (“IRODA”). The IRODA
replaced an earlier 1998 Record of Decision (“ROD”). EPA
concluded that it needed to issue the IRODA because the
human health and environmental threats at the FMC site were
greater than anticipated, there were “immediate” threats to
human health and the environment, and EPA “no longer
considered” the 1998 ROD “protective of human health and
the environment.” IRODA at v, 14, 52; see also id. at ii, 16,
20.
The IRODA noted the particular dangers of the elemental
phosphorus present at the FMC site: Elemental phosphorus
is an “ignitable and reactive waste” that has “physical
properties unlike most contaminants of concern . . .
encountered in environmental response actions.” Id. at iii.
Due to these characteristics, elemental phosphorus “requires
special handling techniques not only for routine handling but
also for emergency response.” Id. The IRODA noted that the
remedial work completed under the RCRA Consent Decree
was independent of the remedial work that remained to be
done under CERCLA. Id. at v.
The IRODA outlined an extensive, multi-part “interim
amended remedy” to be implemented on the FMC site. The
IRODA included the following remedial measures: (1) place
evapotranspiration caps over eight “remediation areas” on the
Reservation containing “non-slag fill (such as elemental
phosphorous, phossy solids, precipitator solids, . . . ),” id.;
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 21
(2) place “approximately 12 inches of soil cover over areas
containing slag fill, ore stockpiles, and the former Bannock
Paving areas to prevent [] exposure to gamma radiation and
fugitive dust,” id. at iii–iv; (3) “[c]lean underground
reinforced concrete pipes that contain elemental phosphorous
and radionuclides,” id. at iv; (4) “[i]nstall an interim
groundwater extraction/treatment system to contain
contaminated groundwater, thereby preventing contaminated
groundwater from migrating beyond the FMC OU and into
the Simplot OU and/or adjoining springs or the Portneuf
River,” id.; (5) “[i]mplement a long-term groundwater
monitoring program to evaluate the performance of the soil
and groundwater remedial actions,” id.; and (6) “[i]mplement
a gas monitoring program at the FMC OU capped ponds (also
referred to as the CERCLA Ponds to distinguish them from
the RCRA-regulated ponds) and subsurface areas where
elemental phosphorous is present to identify potential
phosphine and other potential gas generation at
concentrations that could pose a risk to human health,” id.
(emphasis in original).
In its brief to us, FMC wrote, “The IRODA—which
remains in effect today—requires an additional set of
remedial actions that EPA has concluded are appropriate and
fully ‘protective of human health and the environment.’”
(emphasis added.) FMC’s brief misrepresents what the EPA
wrote. The EPA did not write that the interim remedial
measures described in the IRODA would be “fully”
protective. Here is what the EPA wrote in the IRODA,
specifying that the remedial measures are “interim” (which
FMC’s brief failed to mention), and not using the word
“fully” (which FMC’s brief supplied):
22 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
The measures in this selected interim
amended remedy will be protective of human
health and the environment, comply with
federal and state/tribal requirements that are
applicable or relevant and appropriate within
the scope of the selected interim amended
remedy, and result in cost-effective action and
utilize permanent solutions and alternative
treatment (or resource recovery) technologies
to the maximum extent practicable.
IRODA at v (emphasis added to indicate words quoted in
FMC’s brief).
The IRODA went on to specify:
Because the selected interim amended remedy
will result in hazardous substances, pollutants,
or contaminants remaining on the FMC OU
above levels that allow for unrestricted use
and unlimited exposure, a statutory review
will be conducted within 5 years after
initiation of the remedial action, and every 5
years thereafter to ensure that the interim
amended remedy is or will [sic] protect
human health and the environment.
Id. at vi.
The Tribal Court of Appeals’ factual findings were based
in substantial part on the IRODA, and on earlier orders by the
EPA, whose factual findings were not contested by FMC.
See e.g., Tribal Court of Appeals, May 2014 Opinion, at 6
n.2. The Tribal Court of Appeals found that “FMC created
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 23
and continues to store millions of tons of toxic waste on its
fee land within Reservation boundaries.” Id. at 5. This
hazardous waste includes (1) as much as 16,000 tons of
elemental phosphorus that leaked into the soil during
production and now contaminates approximately 780,000
cubic yards of soil weighing approximately 1 million tons;
(2) elemental phosphorus that is “suspended in contaminated
water” and contained in 23 waste storage ponds on the site;
(3) “phosphine gas,” which is produced when elemental
phosphorus is exposed to water; (4) approximately 21 tanker
rail cars that were used to ship hazardous elemental
phosphorous sludge and are now buried in unlined soil on the
site; and (5) groundwater contaminated with arsenic and
phosphorus that flows into important ground and surface
water resources on the Reservation. Id. at 5–7 (citing IRODA
at 7–9). “The site was also filled and graded using millions
of tons of slag that contains radioactive materials which emit
gamma radiation in excess of EPA’s human health safety
standards.” Id. at 6 (citing IRODA at 7–9).
The Tribal Court of Appeals found that FMC’s creation
and storage of this hazardous waste on the Reservation
creates “an ongoing and extensive threat to human health”
and threatens the “welfare and cultural practices of the Tribes
and their members.” Id. at 5. “The elemental phosphorus in
the soil and in containment ponds [on] FMC’s land is
reactive, meaning that it will burst into flames when exposed
to oxygen.” Id. at 6 (citing IRODA at 77). “The phosphorus
itself is toxic when ingested, inhaled or absorbed.” Id. (citing
IRODA at 78). Phosphine gas, which “is harmful and even
deadly to humans at certain levels,” has been released from
the site at dangerous levels. Id. at 7 (citing IRODA at 77).
The tanker rail cars buried at the site contained “from 200 to
2,000 tons of elemental phosphorus sludge, 10–25% of which
24 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
remained in each of the tankers at the time they were buried”
because FMC concluded cleaning them was “dangerous” to
employees. Id. at 7–8. These tankers remain in the ground
today, and “it is possible that they either have or will corrode
to the point of leakage.” Id. “Arsenic and phosphorus from
the site are continuously flowing in the groundwater from
FMC’s land through seeps and springs directly into the
Portneuf River and Fort Hall Bottoms.” Id. at 8. This
groundwater contamination “negatively affects the ecosystem
and subsistence fishing, hunting and gathering by tribal
members at the River, as well as the Tribes’ ability to use this
important resource as it has been historically used for cultural
practices, including the Sundance.” Id.
The Tribal Court of Appeals stated that “FMC does not
challenge” that the hazardous materials present at the FMC
site “do pose a threat” to the Tribes. Id. at 9. “Rather, [FMC]
contends that if certain methods suggested by the EPA are
undertaken and properly implemented by FMC in the future,
the risk will be contained.” Id. But the court found that EPA
itself continues to view FMC’s site as dangerous to public
health and welfare. For example, in 2013, a year after the
issuance of the IRODA, the EPA wrote that hazardous waste
at the FMC site “may constitute an imminent and substantial
endangerment to public health or welfare or the
environment.” Id. (quoting EPA, Unilateral Admin. Order
for Remedial Design and Remedial Action, No. CERCLA-10-
2013-0116, at 9–10 (June 10, 2013)). Further, the court
wrote, “Although the EPA has been involved at this site since
1990, remedial actions chosen by the EPA have not been
implemented” and many “proposed remedial actions are still
in design phase only.” Id. “EPA’s IRODA is itself only an
interim measure.” Id. “[A] final Record of Decision will not
be available for five to ten years.” Id. (citing IRODA at 19).
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 25
“EPA’s plans remain just that: Plans.” Id. In addition,
“EPA’s plans are containment plans,” which would keep the
hazardous wastes on the Reservation “for the indefinite
future.” Id.
The Tribal Court of Appeals held that the Tribes had
regulatory and adjudicatory jurisdiction over FMC under the
second Montana exception. It concluded that FMC’s storage
of millions of tons of toxic waste on the Reservation poses a
serious threat, and has a direct effect on, “the political
integrity, the economic security or the health or welfare of the
[Tribes].” See Tribal Court of Appeals, May 2014 Opinion
at 14–15; Tribal Court of Appeals, Statement of Decision
at 29–32. The Court concluded that this threat “is real; it is
not a mere potential,” and is a threat of catastrophic
consequences to the Tribes. Tribal Court of Appeals,
May 2014 Opinion, at 11.
On May 16, 2014, the Tribal Court of Appeals issued a
final judgment, holding FMC liable for an annual use permit
fee of $1.5 million. See Shoshone-Bannock Tribes Land Use
Dep’t and Fort Hall Bus. Council v. FMC Corp., Judgment
and Order for Attorney Fees and Costs, May 16, 2014. The
court assessed FMC $19,500,000 for unpaid permit fees for
2002–2014; $928,220.50 in attorneys’ fees; and $91,097.91
in costs, for a total judgment of $20,519,318.41. Id.
D. Federal District Court Proceedings
In November 2014, FMC filed a complaint in the United
States District Court for the District of Idaho, requesting that
the district court deny enforcement of the judgment of the
Tribal Court of Appeals. The Tribes counterclaimed, seeking
an order enforcing the judgment.
26 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
The district court granted the Tribes’ motion to enforce
the judgment. The court concluded that the Tribes had
jurisdiction over FMC under both Montana exceptions. The
district court rejected FMC’s due process challenge based on
the alleged bias of Judges Gabourie and Pearson on the first
panel of the Tribal Court of Appeals. The court noted that the
reconstituted panel reconsidered the rulings of the first panel
and, in relevant part, independently reached the same
conclusions.
The district court enforced the judgment in its entirety
under the first Montana exception. However, the court
denied comity under the second Montana exception on the
ground that there was insufficient nexus between the
$1.5 million annual permit fee and the costs of tribal
programs required to mitigate the threat from the storage of
FMC’s hazardous waste on the Reservation. The court
concluded that the second Montana exception was therefore
not a ground on which the judgment could be enforced.
The present appeal followed. FMC argues that the Tribes
lacked jurisdiction over FMC under both Montana
exceptions, and that FMC was denied due process. The
Tribes cross-appeal, arguing that the district court erred in
finding that the judgment was not enforceable under the
second Montana exception.
II. Appellate Jurisdiction and Standard of Review
We have appellate jurisdiction under 28 U.S.C. § 1291.
“We have . . . recognized that because tribal courts are
competent law-applying bodies, the tribal court’s
determination of its own jurisdiction is entitled to ‘some
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 27
deference.’” Water Wheel Camp Recreational Area, Inc. v.
LaRance, 642 F.3d 802, 808 (9th Cir. 2011) (quoting FMC v.
Shoshone-Bannock Tribes, 905 F.2d 1311, 1313 (9th Cir.
1990)). “As we consider questions of tribal jurisdiction, we
are mindful of ‘the federal policy of deference to tribal
courts’ and that ‘[t]he federal policy of promoting tribal self-
government encompasses the development of the entire tribal
court system, including appellate courts.’” Id. at 808 (quoting
Iowa Mut. Ins. Co. v. LaPlante, 480 U.S. 9, 16–17 (1987));
see also United States v. Wheeler, 435 U.S. 313, 332 (1978)
(recognizing that “tribal courts are important mechanisms for
protecting significant tribal interests”).
We review de novo tribal courts’ legal rulings on tribal
jurisdiction, and we review for clear error tribal courts’
factual findings underlying their jurisdictional rulings. Big
Horn Cty. Elec. Coop., Inc. v. Adams, 219 F.3d 944, 949 (9th
Cir. 2000); AT&T Corp. v. Coeur d’Alene Tribe, 295 F.3d
899, 904 (9th Cir. 2002).
We review de novo the district court’s summary judgment
decision on the due process claim. Big Horn Cty., 219 F.3d
at 949.
III. Discussion
The core question in this appeal is whether we should
recognize and enforce the Shoshone-Bannock Tribal Court of
Appeals’ final judgment holding FMC liable for an annual
use permit fee of $1.5 million.
“As a general rule, federal courts must recognize and
enforce tribal court judgments under principles of comity.”
AT&T Corp. v. Coeur d’Alene Tribe, 295 F.3d at 903 (citing
28 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
Wilson v. Marchington, 127 F.3d 805, 810 (9th Cir. 1997)).
In some circumstances, however, we will not recognize and
enforce a judgment. Id. First, we will not recognize and
enforce a judgment if the tribal court did not have both
personal and subject matter jurisdiction. Id. Second, we will
not enforce a judgment if the tribal court denied due process
to the losing party. Id. Further, “[u]nder limited
circumstances, . . . [we] may refuse to recognize or enforce a
tribal judgment on equitable grounds as an exercise of
discretion.” Id.
FMC argues we should not enforce the judgment of the
Shoshone-Bannock Tribal Court of Appeals for two reasons.
First, FMC argues the Tribes lacked subject matter
jurisdiction over FMC. Second, FMC argues it was denied
due process of law because two judges of the Tribal Court of
Appeals were biased against it.
Unless we hold that the Shoshone-Bannock Tribal Court
of Appeals lacked subject matter jurisdiction or denied FMC
due process, we “must enforce the tribal court judgment
without reconsidering issues decided by the tribal court.” Id.
at 903–04 (citing Iowa Mut. Ins. Co., 480 U.S. at 19 (“Unless
a federal court determines that the Tribal Court lacked
jurisdiction . . . proper deference to the tribal court system
precludes relitigation of issues . . . resolved in the Tribal
Courts.”)). We “may not readjudicate questions—whether of
federal, state or tribal law—already resolved in tribal court
absent a finding that the tribal court lacked jurisdiction or that
its judgment be denied comity for some other valid reason.”
Id. at 904.
We address each of FMC’s arguments in turn. We hold
that the Tribes had regulatory and adjudicatory jurisdiction
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 29
under both Montana exceptions to impose and enforce the
permit fees. We further hold that there was no due process
violation. Finally, we hold that the final judgment of the
Shoshone-Bannock Tribal Court of Appeals is entitled to
recognition and enforcement under principles of comity under
both Montana exceptions.
A. Subject Matter Jurisdiction
We first determine whether the Shoshone-Bannock Tribal
Court of Appeals had subject matter jurisdiction over the
Tribes’ claims against FMC. To make that determination, we
must answer two related questions. First, did the Tribes have
regulatory jurisdiction to impose the permit fees? Second,
did the Tribes have adjudicatory jurisdiction to enforce those
fees in tribal court? See, e.g., Water Wheel, 642 F.3d at 809
(“To exercise its inherent civil authority over a defendant, a
tribal court must have [] subject matter jurisdiction—
consisting of regulatory and adjudicative jurisdiction . . . .”);
see also Knighton v. Cedarville Rancheria of N. Paiute
Indians, 922 F.3d 892, 899 (9th Cir. 2019) (quoting the
same). For the reasons that follow, we hold that the Tribes
had both regulatory and adjudicatory jurisdiction.
1. Regulatory Jurisdiction
The case before us concerns nonmember conduct on non-
Indian-owned fee land within the boundaries of the
Reservation. We therefore apply the Supreme Court’s
framework set forth in Montana v. United States, 450 U.S.
544 (1981), to determine whether the Tribes had regulatory
jurisdiction to impose permit fees on FMC. See Window
Rock Unified Sch. Dist. v. Reeves, 861 F.3d 894, 898 (9th Cir.
2017), as amended (Aug. 3, 2017) (explaining that “[o]ur
30 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
caselaw has long recognized two distinct frameworks for
determining whether a tribe has jurisdiction over a case
involving a non-tribal-member defendant: (1) the right to
exclude, which generally applies to nonmember conduct on
tribal land; and (2) the exceptions articulated in Montana v.
United States, 450 U.S. 544 (1981), which generally apply to
nonmember conduct on non-tribal land.” (emphasis added)).
In Montana, the Supreme Court held that there are three
bases for tribal regulatory jurisdiction over nonmember
activities on non-Indian fee land within the boundaries of a
reservation—the so-called Montana exceptions. 450 U.S.
at 565–66 (“Indian tribes retain inherent sovereign power to
exercise some forms of civil jurisdiction over non-Indians on
their reservations, even on non-Indian fee lands.”); Bugenig
v. Hoopa Valley Tribe, 266 F.3d 1201, 1209–10 (9th Cir.
2001) (en banc) (discussing the same); see also Iowa Mut.
Ins. Co., 480 U.S. at 18 (“Tribal authority over the activities
of non-Indians on reservation lands is an important part of
tribal sovereignty.”); Attorney’s Process & Investigation
Servs., Inc. v. Sac & Fox Tribe of Miss. in Iowa, 609 F.3d
927, 934–35 (8th Cir. 2010) (briefly discussing some of the
historical scope of tribal sovereignty and changes over time).
Cf. Worcester v. Georgia, 31 U.S. 515, 557 (1832) (Tribes are
“distinct political communities, having territorial boundaries,
within which their authority is exclusive, and having a right
to all the lands within those boundaries, which is not only
acknowledged, but guarantied by the United States.”).
First, a tribe retains the inherent sovereign authority to
“regulate, through taxation, licensing, or other means, the
activities of nonmembers who enter consensual relationships
with the tribe or its members, through commercial dealing,
contracts, leases or other arrangements.” 450 U.S. at 565.
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 31
Second, a tribe “retain[s] inherent power to exercise civil
authority over the conduct of non-Indians on fee lands within
its reservation when that conduct threatens or has some direct
effect on the political integrity, the economic security, or the
health or welfare of the tribe.” Id. at 566. Third, a Tribe may
regulate the conduct of nonmembers on non-Indian fee land
when that regulation is expressly authorized by federal statute
or treaty. See Strate, 520 U.S. at 445; Montana v. U.S. EPA,
137 F.3d 1135, 1140 (9th Cir. 1998). There is a presumption
against tribal jurisdiction over nonmember activity on non-
Indian fee land. Bugenig, 266 F.3d at 1209–10; see Plains
Commerce Bank v. Long Family Land & Cattle Co., 554 U.S.
316, 330 (2008). The Tribes bear the burden of rebutting that
presumption. Plains Commerce Bank, 554 U.S. at 330.
Only the first two jurisdictional bases are relevant here.
We examine them in turn.
a. First Montana Exception
The first Montana exception provides that tribes have
jurisdiction to “regulate, through taxation, licensing, or other
means, the activities of nonmembers who enter consensual
relationships with the tribe or its members,” including
consensual relationships “through commercial dealing,
contracts, leases or other arrangements.” Montana, 450 U.S.
at 565–66; see also Strate, 520 U.S. at 446. The Supreme
Court has recognized that permit requirements and permit
fees constitute a form of regulation. See Morris v. Hitchcock,
194 U.S. 384 (1904) (recognizing tribal jurisdiction to require
non-members to obtain permits and pay a permit fee in order
to graze livestock on reservation).
32 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
For purposes of determining whether a consensual
relationship exists, “consent may be established ‘expressly or
by [the nonmember’s] actions.’” Water Wheel, 642 F.3d
at 818 (quoting Plains Commerce Bank, 554 U.S. at 338).
The test is not subjective. Rather, it is “whether under th[e]
circumstances the non-Indian defendant should have
reasonably anticipated that [its] interactions might ‘trigger’
tribal authority.” Id. at 817–18 (quoting Plains Commerce
Bank, 554 U.S. at 337) (stating also “[t]he Supreme Court has
indicated that tribal jurisdiction depends on what non-Indians
‘reasonably’ should ‘anticipate’ from their dealings with a
tribe or tribal members on a reservation.”).
FMC entered a consensual relationship with the Tribes,
both expressly and through its actions, when it negotiated and
entered into an permit agreement with the Tribes, requiring
annual use permits and an annual $1.5 million permit fee to
store 22 million tons of hazardous waste on the Reservation.
As the district court noted, FMC then “affirmed its
consensual relationship with the Tribes by signing the
Consent Decree, which required FMC to obtain Tribal
permits.” FMC Corp. v. Tribes, 2017 WL 4322393 at *9.
“FMC then cited its consensual relationship with the Tribes”
to the district court and our court “as part of its argument that
the Decree should be approved.” Id. The conduct that the
Tribes seek to regulate through the permit fees at issue—the
storage of hazardous waste on the Reservation—arises
directly out of this consensual relationship. See Knighton,
922 F.3d at 904 (“Montana’s consensual relationship
exception requires that ‘the regulation imposed by the Indian
tribe have a nexus to the consensual relationship itself.’”
(quoting Atkinson Trading Co. v. Shirley, 532 U.S. 645, 656
(2001))).
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 33
FMC argues this consensual relationship was “coerced”
because EPA required FMC to obtain relevant permits from
the Tribes in order to obtain a Consent Decree to settle EPA’s
RCRA-based claims against FMC. FMC may indeed have
been “coerced” in the sense that the EPA required it to obtain
tribal permits as a condition for obtaining a Consent Decree.
However, the “coercion,” if it can be called that, came from
FMC’s strong interest in obtaining a Consent Decree that
would allow it to settle the RCRA suit on favorable terms.
FMC was highly motivated to obtain the Consent Decree
proffered by the EPA. In the words of the district court,
“[T]he Consent Decree allowed FMC to dump the toxic mess
it had created in the EPA’s lap by paying a small fine of
$11.9 million along with a few million dollars in construction
commitments. That was a sweetheart deal and FMC was
desperate to grab it.” FMC Corp. v. Tribes, 2017 WL
4322393 at *13. Faced with a choice between years of
litigation, on the one hand, and a “sweetheart deal” that
required FMC to pay a small fine and obtain tribal permits
whose terms were already known, on the other, FMC chose
to consent to tribal jurisdiction. The district court wrote,
“This was a simple business deal . . . .” Id. at *10. It was
“not the product of illegal duress or coercion.” Id.
We fail to see why a strong interest in obtaining a
particular result is “coercion” that invalidates an agreement
designed to achieve that desired result. Further, to the extent
that there was some kind of “coercion,” it was “coercion” by
the EPA. It was the EPA that insisted on tribal permits as a
condition to agreeing to enter into the Consent Decree. As
the district court observed, the Tribes simply “took advantage
of their bargaining leverage, a long-standing practice in the
34 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
sharp-elbowed corporate world in which FMC does business
every day.” Id.
Moreover, FMC should have reasonably anticipated that
its interactions might “trigger” tribal regulatory authority.
Water Wheel, 642 F.3d at 818 (quoting Plains Commerce
Bank, 554 U.S. at 338). FMC “is no stranger” to the Tribes’
governance and laws or to the Tribes’ regulatory and
adjudicatory jurisdiction. Knighton, 922 F.3d at 904. FMC
has operated on the Reservation for over 50 years and has had
an extensive relationship with the Tribes for 70 years. That
relationship includes a long history of “commercial
dealing[s], contracts, leases, and other arrangements” with the
Tribes, including mining leases, contracts for the supply of
phosphate shale, agreements recognizing the Tribes’ taxing
power, royalty payments, and employment and permit
agreements. Montana, 450 U.S. at 565–66; see also FMC v.
Shoshone-Bannock Tribes, 905 F.2d at 1312 (9th Cir. 1990)
(discussing FMC’s extensive mining operations on the
Reservation to supply the phosphate shale needed to produce
phosphorus at FMC’s facility).
Based on FMC’s history on the Fort Hall Reservation, we
have previously held that FMC had entered into a consensual
relationship with the Tribes. In 1990, in FMC v. Shoshone-
Bannock Tribes, we held that the Tribes had regulatory
jurisdiction over FMC’s activities on its fee land within the
Reservation such that the Tribes could require FMC to
comply with the Tribes’ Tribal Employment Rights
Ordinance. 905 F.2d 1311. Enacted by the Tribes in 1980,
the Ordinance required employers on the Reservation,
including non-Indian employers operating on fee land, to give
mandatory preferences in hiring, contracting, and
subcontracting to Indians. Id. at 1312. FMC initially
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 35
objected to application of the Ordinance to its phosphorus
production plant, the same plant at issue here. Id. But there,
as here, “[a]fter negotiations with the Tribes, FMC entered
into an employment agreement based on the TERO in 1981
that resulted in a large increase in the number of Indian
employees at FMC.” Id. at 1312–13.
In 1986, “the Tribes became dissatisfied with FMC’s
compliance with the employment agreement,” and after
attempts to negotiate failed, the Tribes filed suit in Tribal
Court. Id. at 1313. There, as here, FMC argued the Tribes
lacked regulatory and adjudicatory jurisdiction over FMC.
Id. The Tribal Court held the Tribes had jurisdiction over
FMC and concluded that FMC had violated the Ordinance.
Id. The Tribal Court of Appeals affirmed. Id. When the
parties could not agree on a compliance plan, the Tribal Court
of Appeals entered its own compliance plan and levied an
annual fee of approximately $100,000 against FMC. Id.
We held that the Tribes had jurisdiction over FMC under
Montana’s first exception. We wrote:
FMC has certainly entered into consensual
relationships with the Tribes in several
instances. Most notable are the wide[-
]ranging mining leases and contracts FMC has
for the supply of phosphate shale to its plant.
FMC also explicitly recognized the Tribes’
taxing power in one of its mining agreements.
FMC agreed to royalty payments and had
entered into an agreement with the Tribes
relating specifically to the TERO’s goal of
increased Indian employment and training.
There is also the underlying fact that its plant
36 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
is within reservation boundaries, although,
significantly, on fee and not on tribal land. In
sum, FMC’s presence on the reservation is
substantial, both physically and in terms of
the money involved.
Id. at 1314.
We therefore conclude that the Tribes had regulatory
jurisdiction under Montana’s first jurisdictional basis to
impose the permit fees based on FMC’s consensual
relationship with the Tribes.
b. Second Montana Exception
Under Montana’s second exception, the Tribes must
demonstrate that FMC’s conduct on its fee lands within the
Reservation “threatens or has some direct effect on the
political integrity, the economic security, or the health or
welfare of the tribe.” Montana, 450 U.S. at 566. Under the
second exception, a tribe “may quite legitimately seek to
protect its members from noxious uses that threaten tribal
welfare or security, or from nonmember conduct on the land
that does the same.” Plains Commerce Bank, 554 U.S.
at 336. Threats to tribal natural resources, including those
that affect tribal cultural and religious interests, constitute
threats to tribal self-governance, health and welfare. See,
e.g., id. at 333; Brendale v. Confederated Tribes & Bands of
Yakima Indian Nation, 492 U.S. 408, 441 (1989); Montana v.
U.S. EPA, 137 F.3d at 1139, 1141 (“We have previously
recognized that threats to water rights may invoke inherent
tribal authority over non-Indians. A tribe retains the inherent
power to exercise civil authority over the conduct of non-
Indians on fee lands within its reservation when that conduct
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 37
threatens or has some direct effect on the health and welfare
of the tribe. This includes conduct that involves the tribe’s
water rights. . . . [D]ue to the mobile nature of pollutants in
surface water it would in practice be very difficult to separate
the effects of water quality impairment on non-Indian fee
land from impairment on the tribal portions of the
reservation: A water system is a unitary resource. The
actions of one user have an immediate and direct effect on
other users.”) (internal quotation marks and citations
omitted).
To establish jurisdiction under Montana’s second
exception, the nonmember’s activities “must do more than
injure the [Tribes].” Plains Commerce Bank, 554 U.S. at 341.
The activities must “imperil the subsistence or welfare” of the
tribal community. Montana, 450 U.S. at 566; accord Plains
Commerce Bank, 554 U.S. at 341; Evans v. Shoshone-
Bannock Land Use Policy Comm’n, 736 F.3d 1298, 1306 (9th
Cir. 2013).
Tribal jurisdiction under the second Montana exception
may exist concurrently with federal regulatory jurisdiction.
See Tribal Court of Appeals, May 2014 Opinion, at 5
(discussing the same). As we have explained previously,
there is “no suggestion” in the Montana case law that
“inherent [tribal] authority exists only when no other
government can act.” Montana v. U.S. EPA, 137 F.3d
at 1141.
We conclude that FMC’s storage of millions of tons of
hazardous waste on the Reservation “threatens or has some
direct effect on the political integrity, the economic security,
or the health or welfare” of the Tribes to the extent that it
“imperil[s] the subsistence or welfare” of the Tribes.
38 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
Montana, 450 U.S. at 566. We base our conclusion on the
factual findings of the Tribal Court of Appeals, the factual
findings and conclusions of the EPA, expert testimony
presented in the Tribal Court of Appeals, and the record as a
whole. The record contains extensive evidence of toxic,
carcinogenic, and radioactive substances at the FMC site. We
highlight here only two sources of contamination and the
threats they pose to the Tribes: elemental phosphorus in the
ground, and phosphine gas in the air.
i. Elemental Phosphorus in the Ground
Millions of tons of “ignitable-reactive elemental
phosphorus,” “high concentrations of arsenic,” and gamma
radiation contaminate the soil at the FMC site. EPA, 2013
Unilateral Admin. Order for Remedial Design and Remedial
Action, CERCLA No. 10-2013-0116, at 7 (June 10, 2013)
(“2013 UAO”). “The elemental phosphorus contamination
within the FMC OU alone is at a scale unprecedented
anywhere in the United States . . . .” IRODA at 83. As much
as 16,000 tons of elemental phosphorus saturate the ground,
extend in a plume at least 85 feet below ground, and
contaminate approximately 780,000 cubic yards of soil
weighing 1 million tons. IRODA at 21, 78, 83. This
calculated amount of phosphorus does not include elemental
phosphorus-contaminated wastes that currently sit in ponds
on the FMC site, the elemental phosphorus waste that has
migrated or been blown off-site, and the unknown amount of
waste that is contained in buried rail tanker cars that may
corrode and leak. IRODA at 9, 14, 83. The elemental
phosphorus contamination at the FMC site poses a serious
threat to human health, the environment, and the welfare of
the Tribes. In the EPA’s words, elemental phosphorus at the
FMC site exists “in concentrations exceeding 1,000 parts per
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 39
million (ppm)” in the soil and “will present a significant risk
to human health and the environment should exposure occur.”
IRODA at ii; see also id. at 34 (“[R]isks from exposure to
ignitable elemental phosphorus are severe and highly certain
should direct exposure occur.”).
The EPA concluded that the elemental phosphorus at the
FMC site constitutes a “principal threat waste.” IRODA at ii,
77–78. “Principal threat wastes are those source materials
considered to be highly toxic or highly mobile that generally
cannot be reliably contained or would present a significant
risk to human health or the environment should exposure
occur.” Id. at ii–iii. Elemental phosphorus “is highly toxic
by ingestion, inhalation, and skin absorption”; “may be fatal
at high concentrations; is corrosive to skin and other living
tissue”; “is likely to cause skin burns upon contact”; and is
pyrophoric, meaning it will spontaneously burst into flames
when exposed to the air, producing phosphine and other toxic
gases. Id. at 77–78. Exacerbating the threat, elemental
phosphorus “has physical properties that are unlike most
[contaminants of concern] encountered in environmental
response actions,” requiring “special handling techniques not
only for routine handling but also for emergency response.”
Id. at iii, 77–78; see also id. at 28 (concluding that elemental
phosphorus at the FMC site “could ignite, causing burns and
inhalation hazards from intensely irritating phosphoric acid
aerosols with potential to drift beyond the immediate area.”).
“The threat of elemental phosphorus was vividly described by
Claudeo Bronco, [a witness before the Tribal Court of
Appeals,] who testified that he [saw] ducks spontaneously
ignite as they took off from FMC’s phosphorus containment
ponds.” Tribal Court of Appeals, May 2014 Opinion, at 6–7.
40 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
The EPA’s CERCLA plan calls for FMC to place
evapotranspiration caps over areas contaminated with
elemental phosphorus. IRODA at 68. However, despite the
EPA’s involvement at the site since 1990 when the EPA first
declared the plant a Superfund Site, many areas of the site,
including the area where the tanker railroad cars are buried,
still had not been capped at the time of the 2014 hearing
before the Tribal Court of Appeals. Further, as the EPA
wrote, capping “does not reduce [the] toxicity, mobility, or
volume of contaminants.” Id. at 60. Even if capped,
phosphorus-contaminated soil will remain on the Reservation
indefinitely and continue to present a threat to Tribal health
and welfare.
ii. Phosphine Gas in the Air
Phosphine gas produced from elemental phosphorus
stored in ponds on FMC’s site poses a constant threat to the
Tribes. Phosphine gas is “very flammable,” “highly
reactive,” and “extremely toxic” to humans. Letter from Kai
Elgethun, Idaho Dep’t of Health and Welfare to Greg Weigel,
EPA Idaho Operations Office, at 2–3 (June 1, 2010) (“Letter
from Idaho Dep’t of Health and Welfare”); EPA, Unilateral
Admin. Order for Removal Action, FMC Idaho LLC,
CERCLA No. 10-2010-0170, at 9 (June 14, 2010) (“2010
UAO”); see also Expert Witness Testimony from Dr. Jerrold
Leikin and Dr. Peter Orris, members of EPA’s Supplemental
Environmental Project 14 for the FMC Site (discussing the
dangers of phosphine gas and the FMC site in particular).
Phosphine gas is “immediately dangerous to life and health”
at concentrations of 50 parts per million (“ppm”). 2010 UAO
at 9. It burns spontaneously upon contact with air and
explodes at concentrations at or near 20,000 ppm. Id.; see
also Expert Witness Testimony of Dr. Jerrold Leikin
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 41
(describing phosphine as a “knockdown gas,” meaning a few
breaths can render a person unable to walk or talk, and can
result in extreme harm or eventual death). The short-term
upper limit for human exposure is 1 ppm for 15 minutes of
exposure. 2010 UAO at 9.
There are eleven RCRA waste ponds on FMC’s property
that are supervised under the Consent Decree. Nine of those
ponds were capped between 1999 and 2005. See 2010 UAO
at 8; FMC Corp. v. Tribes at *4. The other two were left
uncapped. Id. at 9–10. Dangerous levels of phosphine gas
build up beneath the evapotranspiration caps on the capped
ponds and are released from the uncapped ponds. Id.
Although the EPA has ordered FMC to implement measures
to contain the gas, releases continue to occur.
In 2006 and 2010, for example, the EPA entered
Unilateral Administrative Orders (“UAO”) responding to
phosphine gas releases from capped and uncapped RCRA
ponds. See EPA, Unilateral Admin. Order for Removal
Actions, FMC Idaho LLC, CERCLA No. 10-2007-0051 (Dec.
14, 2006) (“2006 UAO”); 2010 UAO at 10–11 (noting that in
2005, 2006, 2007, and 2009, levels of phosphine gas in the air
around the RCRA ponds were high enough that workers in
the area either had to delay work or leave the area for their
safety).
The EPA reported in its 2006 UAO that phosphine gas
releases had been detected at RCRA Pond 16S. In June 2006,
“intermittent emissions of smoke” from two temperature
monitoring points (“TMP”) had been observed at the pond.
2006 UAO at 10. Subsequently, “[v]isible air emissions from
Pond 16S [were] observed on a number of occasions [after]
June 2006, including by Shoshone-Bannock Tribal staff on
42 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
September 6, 2006 and September 18, 2006.” Id. FMC had
reported to the EPA that phosphine gas was collecting in
TMP well casings at Pond 16S, and was “likely accumulating
to the phosphine auto-ignition concentration (20,000 parts per
million) inside the temperature well casings or vents.” Id.
The EPA concluded that “[t]he conditions at the Site
constitute[d] an imminent and substantial endangerment to
public health or welfare or the environment within the
meaning of Section 106(a) of CERCLA, 42 U.S.C.
§ 9606(a).” Id. at 13–14 (stating also that the conditions
“constitute a threat to public health or welfare or the
environment”). The EPA issued a “time critical Action
Memorandum on December 13, 2006 for Pond 16S to remove
and treat phosphine and other gases at levels of concern . . . .”
Id. at 12–13.
Dr. Peter Orris testified before the Tribal Court of
Appeals that he “absolutely” agreed with the EPA’s findings
and conclusions in the 2006 UAO. He testified that the
phosphine gas was “both acutely and chronically dangerous
to people in the area or downstream, if you will, or
downwind.” “Phosphine gas [is a] close cousin to the
phosgene gas used in World War I . . . that gassed all the
soldiers, so that a high dose short-term exposure can kill
people. . . . This is pretty catastrophic stuff.”
The EPA reported in its 2010 UAO that “[p]hosphine gas
ha[d] been detected in and around TMPs and in ambient air
at a number of the RCRA Ponds.” 2010 UAO at 9. In late
2009, FMC detected phosphine levels above 1 ppm near Pond
15S, triggering alarms downwind and requiring evacuations
on November 2, 23, and 27, and on December 22. Id. at 11.
In December 2009 to April 2010, FMC detected
concentrations of phosphine gas as high as 23,000 ppm inside
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 43
a lift station associated with Pond 15S. Id. Daily monitoring
from February to April 2010 measured phosphine gas in
“ambient air,” at breathing zone height, ranging from 0 to at
least 20 ppm. Id. at 12. The actual concentrations may have
been much higher. The EPA reported, “[O]n numerous
occasions the monitors [] ‘pegged out’ at 20 ppm,” the upper
detection limit for FMC’s monitors, “indicating some
unknown concentration higher than 20 ppm.” Id. Another
phosphine survey on April 30, 2010, “provided phosphine
readings that averaged 300 ppm” in another area of the pond.
Id.
FMC first reported the issues with Pond 15S to the EPA
in a letter dated April 14, 2010. Id. at 11. In response to an
EPA request for information, FMC sent the EPA monitoring
data from all the RCRA ponds on April 26, 2010. Id. at 12.
The data indicated that phosphine concentrations in the
ambient air around two more ponds—one capped and one
uncapped—were at or near the upper detection limit for
FMC’s monitors. Id. (Ponds 8E and 17); see id. at 8 for a list
of capped and uncapped RCRA ponds.
On June 1, 2010, shortly before the EPA’s release of its
2010 UAO, Dr. Kai Elgethun of the Idaho Department of
Health and Welfare wrote: “We conclude that the phosphine
gas being released from Pond 15S is an urgent public health
hazard to the health of people breathing the air in the
proximity of Pond 15S . . . .” Letter from Idaho Dep’t of
Health and Welfare at 1. Pond 15S is approximately
400 meters south of a road and 600 meters south of an
interstate highway that crosses the Reservation. Id. at 3.
The EPA wrote in the 2010 UAO: “Action is necessary to
protect receptors from inhalation of phosphine at RCRA
44 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
Ponds, and to minimize the risk of fire and explosion from
high concentrations of phosphine gas at the RCRA Ponds.”
2010 UAO at 14. “Receptors,” in the jargon of the EPA, are
individuals who may be exposed to phosphine gas. The EPA
wrote that “receptors” included individuals “at or near the
facility boundaries,” such as railroad and power company
workers, bicyclists and pedestrians on “old Highway 30,” and
“members of the Shoshone-Bannock Tribes.” Id. at 13. The
EPA concluded in 2010, as it had in 2006, that the “[h]igh
concentrations of phosphine accumulating within the [FMC]
RCRA Ponds and being released” “constitute an imminent
and substantial endangerment to public health or welfare or
the environment within the meaning of Section 106(a) of
CERCLA, 42 U.S.C. § 9606(a).” Id. at 13–15. The EPA
issued a “time critical removal Action Memorandum on June
11, 2010, for Ponds 8E, 15S and 17 and the other RCRA
Ponds, requiring air monitoring and action to remove and
treat phosphine gas . . . .” Id. at 13.
David Reisman, a former EPA official who worked at the
EPA for thirty-six years, including several years at the FMC
site, testified before the Tribal Court of Appeals that the
threat of phosphine gas being released from the FMC
site—both onsite and offsite—is “always there.” Reisman
testified that when he visited the FMC site and walked on the
caps on the RCRA ponds he observed visually that “they
were not well maintained.” He testified further, “I think the
data bears out that there is moisture and air getting under the
cap, and mixing with the waste stream in one fashion or
another.” Reisman noted that some phosphine gas is already
escaping because of the nature of the evapotranspiration cap.
He testified that at a landfill site near Las Vegas, repeated
downpours of rain had caused part of an evapotranspiration
cap to slide off the landfill, exposing the waste. If the caps at
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 45
the FMC site were to similarly crack or slide off, Reisman
testified, massive clouds of phosphine gas at lethal exposure
levels would be released.
Reisman testified that proper monitoring to detect releases
of phosphine gas was not being done at the FMC site.
According to Reisman, monitoring remained “a big question
mark” under the 2012 IRODA. See also Testimony of Rob
Hartman, Vice President of FMC Idaho (discussing how a
monitoring plan for phosphine gas “has not been developed”).
Reisman testified that FMC does not have an early warning
system in place, stating that he “hope[d] that all parties would
look into some early warning system in case some of the
catastrophic events would occur.” Another expert witness
described the monitoring at the FMC site as “completely
inadequate.”
The record establishes that FMC’s RCRA ponds on the
Reservation continue to generate lethal amounts of phosphine
gas that accumulate beneath the pond covers. As the district
court wrote, this phosphine gas “pose[s] a constant and
deadly threat to the Tribes” and “a real risk of catastrophic
consequences should containment fail.” FMC Corp. v.
Tribes, 2017 WL 4322393 at *11.
iii. FMC’s Arguments
FMC makes two arguments in its brief against jurisdiction
under the second Montana exception. Both arguments fail.
First, FMC argues that the hazardous waste on its site is
contained, is “actively monitored by FMC and EPA,” and
poses little danger to the Tribes. FMC writes, “The record
does not remotely support jurisdiction under the second
46 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
Montana exception.” FMC’s argument fails to take into
account what is actually in the record.
The hazardous waste at the FMC site constitutes a serious
and continuous threat. The district court summarized:
[T]he EPA has taken substantial steps to
contain the toxic waste and prevent harm. But
the threat remains. . . . Because the EPA
intends to leave the waste on the site
indefinitely, and because the waste’s toxicity
has such a long life—decades if not
longer—there is a real risk that no matter how
well its containment system is designed, the
system may fail. . . . EPA reports demonstrate
that the waste sites are not reservoirs of
passive liquid that can be contained with a
simple dam. Instead, these sites are
generating lethal gases that accumulate under
pressure beneath the pond covers. In other
words, they pose a constant and deadly threat
to the Tribes, a real risk of catastrophic
consequences should containment fail. And
despite the best efforts of the EPA, there have
releases of these toxic gases. . . . This
dangerous threat can only be contained, not
removed or treated. . . . It is so toxic that there
is no safe way to remove it, ensuring that it
will remain on the Reservation for decades.
FMC Corp. v. Tribes, 2017 WL 4322393 at *10–11.
Second, FMC argues that our decision in Evans v.
Shoshone-Bannock Land Use Policy Comm’n, 736 F.3d 1298
 FMC CORP. V. SHOSHONE-BANNOCK TRIBES 47
(9th Cir. 2013), compels the conclusion that the Tribes lack
jurisdiction. Evans is light years away from the case before
us. In Evans, we held that the Tribes’ Land Use Policy
Commission did not have jurisdiction under the second
Montana exception to require a nonmember to obtain tribal
permits for the construction of a single-family home. We
held that the Tribes had not established that the construction
of one single-family home on fee land in an area of the
Reservation that already “contain[ed] many residential
properties owned and inhabited by nonmembers”—unlike the
area in Brendale v. Confederated Tribes & Bands of Yakima
Indian Nation, 492 U.S. 408 (1989), which was closed to the
general public—threatened or had some direct effect on the
political integrity, economic security, or the health or welfare
of the Tribes. Id. at 1303–06. In stark contrast to Evans, the
threats from the FMC site, as Dr. Orris testified, “are not
minimal annoyances. They are the threat of catastrophic
health reactions, including death.”
iv. Nexus
The district court held that due to the extensive
contamination at the FMC site, the Tribes had established
jurisdiction under the second Montana exception. However,
as a matter of comity, the court refused to enforce the
judgment of the Tribal Court of Appeals under the second
exception. In the view of the court, the Tribes had failed to
sufficiently explain the connection between the $1.5 million
annual permit fee and the threat posed by the hazardous
waste. Citing Wilson v. Marchington, 127 F.3d 805 (9th Cir.
1997), the court wrote:
Having jurisdiction under the second Montana
exception, the Tribes are authorized to assess
48 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
a permit fee that has some nexus to the costs
of supplementing the EPA’s program to fully
protect the health and safety of Tribal
members. Yet the Tribes have never
explained why an annual fee of $1.5 million is
necessary to provide that supplemental
protection.
FMC Corp. v. Tribes, 2017 WL 4322393 at *12.
The district court was mistaken in holding that the Tribes
had jurisdiction under the second Montana exception and, at
the same time, holding that the Tribal Court of Appeals’
judgment was not entitled to comity. The nexus question is
part of the jurisdictional question. Once jurisdiction is
established, lack of nexus is not a ground for denying comity
under Marchington.
We take it as a given that there must be some nexus
between a basis for jurisdiction under Montana and a tribal
action taken in the exercise of that jurisdiction. For example,
if the Tribes had insisted under the second Montana
exception that FMC disinvest from its businesses in China,
such insistence would have been an unreasonable exercise of
jurisdiction. However, there is nothing in Montana requiring
that nexus be narrowly defined. There is nothing, for
example, requiring the Tribes to show that the $1.5 million
annual use permit fee be spent on supplemental measures,
beyond those now being taken by the EPA, to protect against
hazards posed by FMC’s hazardous waste. There is evidence
in the record suggesting that the Tribes have spent
approximately $1.5 million annually on measures to monitor
and mitigate the dangers posed by FMC’s hazardous waste,
and indeed that the Tribes might spend more if funds were
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 49
available. But we need not rely on that evidence alone to find
nexus.
A more-than-sufficient nexus may be shown by
comparing fees charged on the open market for hazardous
waste storage, on the one hand, to the $1.5 million annual fee
charged by the Tribes, on the other. FMC’s own evidence in
the Tribal Court of Appeals showed that as of 1995,
commercial hazardous waste disposal facilities charged
between $50 and $250 per ton for bulk disposal (the type of
materials typically disposed of at FMC’s facility). Given the
extreme danger posed by FMC’s hazardous waste, it is an
open question whether anyone could be persuaded to accept
its waste at any price. But assuming that someone would be
willing to accept FMC’s hazardous waste, and using a
midrange fee of $150 per ton, the one-time fee for disposing
of FMC’s 22 million tons of hazardous waste would be
$3.3 billion. Compared to $3.3 billion, an annual fee of
$1.5 million is an extraordinary bargain.
Although we conclude that the Tribes can establish nexus
in this case by showing that they charge less than the open
market fee for comparable activity, we do not mean thereby
to suggest that a tribe in some circumstances might not be
able to charge substantially more than an open market fee, or
might not be able to forbid waste storage or other activities
entirely. We need not hypothesize cases not before us. It is
enough for current purposes to show that there is a more-
than-sufficient nexus between the storage of FMC’s highly
dangerous—potentially catastrophically dangerous—waste
and the $1.5 million annual use permit fee to warrant the
assessment of that fee under Montana’s second exception.
50 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
2. Adjudicatory Jurisdiction
A tribe’s adjudicatory jurisdiction over nonmembers may
not exceed its regulatory jurisdiction. Strate, 520 U.S. at 453;
Water Wheel, 642 F.3d at 814 (noting that the Supreme Court
has “articulated the general rule that a tribe’s adjudicative
jurisdiction may not exceed its regulatory jurisdiction”).
However, the Supreme Court has never decided whether a
Tribe’s adjudicatory jurisdiction is necessarily as extensive as
its regulatory jurisdiction. See Water Wheel, 642 F.3d at 816.
Where as here, we hold that the Tribes had regulatory
jurisdiction, we are thus presented with the question of
whether they also had adjudicatory jurisdiction.
The Court has held that “where tribes possess authority to
regulate the activities of nonmembers, ‘civil jurisdiction over
disputes arising out of such activities presumptively lies in
the tribal courts.’” Strate, 520 U.S. at 453 (citation omitted);
see also Iowa Mut. Ins. Co., 480 U.S. at 18 (“Tribal authority
over the activities of non-Indians on reservation lands is an
important part of tribal sovereignty. Civil jurisdiction over
such activities presumptively lies in the tribal courts unless
affirmatively limited by a specific treaty provision or federal
statute.” (internal citations omitted)); Knighton, 922 F.3d
at 906 (discussing the same); Water Wheel, 642 F.3d at 814
(discussing the same). In two recent cases—both involving
nonmember conduct on tribal land—we have held that tribes
had adjudicatory jurisdiction. See Knighton, 922 F.3d at
906–07; Water Wheel, 642 F.3d at 814–16. In both cases, we
based our holding on the existence of regulatory jurisdiction,
the nature of the tribal sovereign interests, long-standing
principles of Indian law, and congressional interest in tribal
self-government. Based on those same factors, we conclude
that the Shoshone-Bannock Tribal Court of Appeals had
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 51
adjudicatory jurisdiction over the Tribes’ claims in this case.
See Knighton, 922 F.3d at 907 (concluding the same); Water
Wheel, 642 F.3d at 816 (concluding the same). As we stated
in Water Wheel, “Any other conclusion would impermissibly
interfere with the tribe’s inherent sovereignty, contradict
long-standing principles the Supreme Court has repeatedly
recognized, and conflict with Congress’s interest in
promoting tribal self-government.” 642 F.3d at 816.
B. Due Process
We held in Wilson v. Marchington that a federal court
must “reject a tribal judgment if the defendant was not
afforded due process of law.” 127 F.3d at 811. “Due
process, as that term is employed in comity, . . . [requires]
that there has been opportunity for a full and fair trial before
an impartial tribunal that conducts the trial upon regular
proceedings after proper service or voluntary appearance of
the defendant, and that there is no showing of prejudice in the
tribal court or in the system of governing laws.” Id. Comity,
however, “does not require that a tribe utilize judicial
procedures identical to those used in the United States
Courts.” Id. We must “be careful to respect tribal
jurisprudence” as well as tribes’ customs and traditions. Id.
“Extending comity to tribal judgments is not an invitation for
[us] to exercise unnecessary judicial paternalism in
derogation of tribal self-governance.” Id. “However, the
tribal court proceedings must afford the defendant the basic
tenets of due process or the judgment will not be recognized
by the United States.” Id. FMC argues it was denied due
process. We disagree.
FMC’s primary argument is that two judges on the Tribal
Court of Appeals—Judges Gabourie and Pearson—were not
52 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
impartial. In support of its argument, FMC cites the judges’
remarks at the conference sponsored by the University of
Idaho College of Law. FMC’s argument fails for two
reasons.
First, Judges Gabourie and Pearson did not make any
statements at the conference indicating bias against FMC. At
several points in their remarks, both judges emphasized the
importance of impartiality. Transcript of Tribal Courts:
Jurisdiction and Best Practices (“Transcript”) at 9 and 19
(stating “every court has—should be impartial”; “a good
opinion comes [from] both sides, both parties. Because both
parties rely on a good opinion, strong opinion.”; you “need to
make sure that you do the job right”). Although Judges
Gabourie and Pearson criticized various Supreme Court
opinions, including Montana, disagreement with an opinion
of the Supreme Court does not indicate that judges cannot
faithfully apply that opinion to the case before them. If such
were the case, federal and state judges would need to recuse
themselves with some frequency. See, e.g., Republican Party
of Minn. v. White, 536 U.S. 765, 779 (2002) (“[J]udges often
state their views on disputed legal issues outside the context
of adjudication—in classes that they conduct, and in books
and speeches.”); In re Complaint of Judicial Misconduct,
632 F.3d 1289, 1289 (9th Cir. 2011) (“The Code of Conduct
encourages judges to ‘speak, write, lecture, teach, and
participate in other activities concerning the law, the legal
system, and the administration of justice.’ Engaging in such
law-related activities—including speeches that comment on
current events and legal developments—is permitted not only
because judges are citizens, but because they are particularly
knowledgeable on such topics.” (internal citations omitted));
In re Charges of Judicial Misconduct, 769 F.3d 762, 785
(D.C. Cir. 2014) (“[C]riticizing the [Supreme] Court does not
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 53
constitute judicial misconduct. . . . It would be all but
impossible for a judge to urge changes in the course of the
law, or even to comment on substantive legal issues, without
being able to reference and criticize decisions of the Supreme
Court. Not surprisingly, then, there is a long tradition of
lower court judges criticizing the Court on issues of
constitutional law [and other areas].”).
Judge Pearson did mention at one point that she had a
“big case” that she believed was “going to go up,” and that
she was saying prayers, reading cases, and trying to do the
history. However, she said nothing about the merits of the
case. Cf. In re Charges of Judicial Misconduct, 769 F.3d
at 787–88 (“[N]otwithstanding the general prohibition on
commenting on the merits of pending or impending matters,
the Code contains an exception for offering such comments
in the context of ‘scholarly presentations made for purposes
of legal education.’” (citing Canon 3A(6) of the Judicial-
Conduct Rules)).
Second, to the degree Judges Gabourie and Pearson’s
remarks may be thought to have indicated bias against FMC,
a reconstituted panel of judges considered the prior rulings of
the Tribal Court of Appeals. The reconstituted panel revised
one aspect of the court’s prior decision and affirmed the
others. A differently reconstituted panel then handled all
proceedings going forward, including the hearing on
jurisdiction under Montana’s second exception. The actions
of the reconstituted panels eliminated any possible due
process concerns arising from the remarks of Judges
Gabourie and Pearson, and from their participation in earlier
decisions of the Tribal Court of Appeals.
54 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
FMC makes other due process arguments, including that
the Fort Hall Business Council improperly closed the record;
that the Tribal Court of Appeals improperly rejected evidence
from FMC as untimely; that the Tribal Court of Appeals,
rather than the trial court, held an evidentiary hearing; and
that the tribal courts are not independent from the Fort Hall
Business Council. FMC has either waived these arguments
or they are self-evidently meritless.
FMC’s due process arguments are based in part on an
underlying argument that, in FMC’s words, tribal courts
present “inherent risks . . . for denying nonmembers” due
process protections. The Supreme Court, our circuit, and our
sister circuits have repeatedly rejected that and other similar
arguments. See, e.g., Nat’l Farmers Union Ins. Cos. v. Crow
Tribe of Indians, 471 U.S. 845, 855–57 (1985) (requiring
nonmembers to exhaust tribal court remedies and stating that
exhaustion will “provide other courts with the benefit of
[tribal court] expertise”); Norton v. Ute Indian Tribe of the
Uintah & Ouray Reservation, 862 F.3d 1236, 1249–50 (10th
Cir. 2017) (“We also reject the officers’ arguments that they
will suffer undue bias and a lack of due process if subjected
to tribal jurisdiction. The officers offer little support for their
allegations, which boil down to baseless ‘attacks’ on the
competence and fairness of the Ute Tribal Court. The
Supreme Court has already explained that such arguments are
contrary to federal policy . . . . The Court has also
‘repeatedly’ recognized tribal courts ‘as appropriate forums
for the exclusive adjudication of disputes affecting important
personal and property interests of both Indians and non-
Indians.’” (citing Iowa Mut. Ins. Co., 480 U.S. at 19; Santa
Clara Pueblo, 436 U.S. at 65; Wheeler, 435 U.S. at 332
(“[T]ribal courts are important mechanisms for protecting
significant tribal interests.”))).
FMC CORP. V. SHOSHONE-BANNOCK TRIBES 55
The Tenth Circuit recently wrote, “Although it is true that
the Bill of Rights does not itself constrain tribal court
proceedings, see Talton v. Mayes, 163 U.S. 376, 382–85
(1896), this does not leave the rights of nonmembers
unprotected in tribal courts.” Norton, 862 F.3d at 1249. “The
Indian Civil Rights Act (ICRA), 25 U.S.C. §§ 1301–04,
expressly provides that no tribe may ‘deny to any person
within its jurisdiction the equal protection of its laws or
deprive any person of liberty or property without due process
of law.’” Id. at 1249–50 (citing 25 U.S.C. § 1302(a)(8)); see
also Iowa Mut. Ins. Co., 480 U.S. at 19 (noting that ICRA
“provides non-Indians with various protections against unfair
treatment in the tribal courts”). “Making good on these due
process guarantees, nearly five decades of tribal cases
applying ICRA show that tribal courts protect the rights of
both member and nonmember litigants in much the same way
as do federal and state courts.” Norton, 862 F.3d at 1250.
“[T]ribal courts often provide litigants with due process that
‘exceed[s] the protections offered by state and federal
courts.’” Id. (second alteration in original) (citing Matthew
L.M. Fletcher, American Indian Tribal Law 325 (2011)).
“[E]mpirical studies demonstrate that tribal courts are
even-handed in dispensing justice to nonmembers.” Id.; see,
e.g., Bethany R. Berger, Justice and the Outsider:
Jurisdiction Over Nonmembers in Tribal Justice Systems,
37 Ariz. St. L.J. 1047, 1047, 1051 (2005) (“Navajo appellate
courts are remarkably balanced in hearing cases involving
outsiders. . . . The court is both numerically balanced in its
decisions regarding nonmembers . . . and qualitatively
balanced, even in areas . . . that might seem particularly prone
to bias. A less comprehensive review of decisions from other
tribal court systems reveals a similar effort to decide issues
fairly, even where it requires ruling against tribal members or
56 FMC CORP. V. SHOSHONE-BANNOCK TRIBES
the tribe itself.”); Mark D. Rosen, Multiple Authoritative
Interpreters of Quasi-Constitutional Federal Law: Of Tribal
Courts and the Indian Civil Rights Act, 69 Fordham L. Rev.
479, 578 (2000) (concluding from a study of twelve years of
decisions from approximately twenty-five tribal courts that
“tribal courts have [not] succumbed to the temptation to favor
the insider at the expense of outsiders”).
Our own experience in reviewing tribal court decisions is
consistent with the findings of these studies. Tribal courts,
like all courts (including our own), make mistakes. But,
contrary to the contention of FMC, tribal courts do not treat
nonmembers unfairly.
C. Comity
Because we hold that the Tribes had regulatory and
adjudicatory jurisdiction under both Montana bases, and that
FMC was not denied due process, we recognize and enforce
the Tribal Court of Appeals’ judgments under principles of
comity. See AT&T Corp. v. Coeur d’Alene Tribe, 295 F.3d
at 903. The judgment of the Tribal Court of Appeals is
enforceable under both the first and second Montana
exceptions. See Wilson v. Marchington, 127 F.3d at 810.
Conclusion
We hold that the Tribes had regulatory and adjudicatory
jurisdiction under both Montana exceptions, and that the
Tribal Court of Appeals did not violate FMC’s right to due
process. We hold that the judgment of the Tribal Court of
Appeals is enforceable under principles of comity.
AFFIRMED.