Navajo Nation v. Department of the Interior ( 2021 )

UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF COLUMBIA
THE NAVAJO NATION,
Plaintiff,
v.
No. 20-cv-1093 (DLF)
U.S. DEPARTMENT OF THE INTERIOR,
et al.,
Defendants.
MEMORANDUM OPINION
Before the Court are the plaintiff’s Motion for Summary Judgment, Dkt. 12, and the
government’s Cross-Motion for Summary Judgment, Dkt. 13. For the reasons below, the Court
will grant the plaintiff’s motion and deny the government’s motion.
I. BACKGROUND
A. Legal Background
“Congress enacted the Indian Self-Determination and Education Assistance Act
(“ISDEAA”) to help Indian tribes assume responsibility for programs or services that a federal
agency would otherwise provide to the tribes’ members.” Navajo Nation v. U.S. Dep’t of
Interior, 852 F.3d 1124, 1126 (D.C. Cir. 2017). Under that Act, Indian tribes may enter “self-
determination contract[s] . . . to plan, conduct, and administer programs” that the Secretary of the
Interior operates for their benefit. 25 U.S.C. § 5321(a)(1). To form such a contract, a tribe must
first propose terms to the Secretary. Id. § 5321(a)(2). From there, “the Secretary shall . . .
approve the proposal” within ninety days “unless” he “clearly demonstrates,” or supports with
“controlling legal authority,” one of the five showings listed in § 5321(a)(2). These grounds for
rejecting the proposal include that the tribe’s “proposed project . . . cannot be properly completed
or maintained by the proposed contract,” id. § 5321(a)(2)(C), and that a tribe has requested funds
“in excess of [its] applicable funding level,” id. § 5321(a)(2)(D).
Upon entering a self-determination contract, tribes are entitled to IHS funding for both
“direct program expenses” and “contract support costs.” 25 U.S.C. § 5325(a)(3)(A). This
funding may be awarded through Annual Funding Agreements (AFAs), which “represent[] the
negotiated agreement of the Secretary to fund, on an annual basis, the programs, services,
activities and functions transferred to an Indian tribe.” 25 C.F.R. § 900.6. The process for
approving an AFA, like that of forming a self-determination contract, begins with a proposal
from the tribe to the Secretary. See id. § 900.32. If a proposed AFA is “substantially the same”
as the prior AFA, the Secretary “shall approve and add to the contract the full amount of funds to
which the contractor is entitled.” Id. Otherwise, the portions of the proposal that are not
“substantially the same” are subject to “declination criteria and procedures” that apply to self-
determination contracts. Id. Thus, the Secretary may decline to approve those portions “only . . .
for one of [the] five specific reasons” listed in 25 U.S.C. § 5321(a)(2). Id. § 900.22.
If the Secretary declines to approve a proposed AFA, the affected tribe may challenge the
Secretary’s decision in federal district court. See 25 U.S.C. § 5331(a); 25 C.F.R § 900.153. As
an alternative, the tribe may appeal the decision to the Interior Board of Indian Appeals (IBIA),
with the possibility of further review in federal court. See 25 C.F.R. § 900.158; 25 U.S.C. §
5331(a). Finally, the tribe may request an informal conference to be “conducted by a designated
representative of the Secretary.” 25 C.F.R. § 900.155(c). If the tribe elects to participate in an
informal conference, the presiding representative will issue a written report that “summarizes
what happened at the [] conference and [contains] a recommended decision.” Id. § 900.156(a).
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If a tribe is “dissatisfied” with that decision, it may appeal within thirty days to the IBIA. Id.
§ 900.156(b). Otherwise, “the recommended decision becomes final.” Id. § 900.157.
B. Factual Background
The Navajo Nation is a federally recognized Indian tribe that operates a forestry
management program pursuant to a self-determination contract. See Pl.’s Statement of Material
Facts Not in Dispute ¶ 1, Dkt. 12. Under that contract, the Nation receives funding through
Annual Funding Agreements (AFAs) and Successor Annual Funding Agreements (SAFAs). Id.
¶ 2. On September 28, 2019, the Nation submitted a proposed SAFA for contract year 2020,
which requested $737,745 to cover direct program expenses. Compl. Ex. A at 33, Dkt. 1-1. The
SAFA also proposed modifying which forest management functions the contract covers. See id.
at 22–26. Under its terms, the Nation would be permitted to “operate a woodlot to produce
firewood for sale to the public” and would be exempt from several reporting requirements that
were contained in the 2019 SAFA. Id. at 25.
On December 19, 2019, the Secretary denied the Nation’s proposed SAFA. See Compl.
Ex. B, Dkt. 1-2. To support that denial, the Secretary found that the Nation requested funding
“in excess of the . . . funding level” available under the parties’ contract. Id. at 3 (citing 25
C.F.R. § 900.22(d)). He also found that the SAFA’s subject matter could not “be properly
completed or maintained by the proposed contract,” 25 U.S.C. § 5321(a)(2)(C). Id. at 2–3.
On January 7, 2020, the Nation requested the review of that decision in an informal
conference. See Compl. Ex. C at 3, Dkt. 1-3. Following that conference, the Secretary’s
representative directed that the Nation receive $717,736.77 for direct program expenses under its
contract. Id. at 4. The representative also found that the 2020 SAFA was not “substantially
different” from the 2019 SAFA, which required approving its terms irrespective of the
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declination criteria in 25 U.S.C. § 5321(a)(2). Id. at 7. Finally, the representative found that,
even if the declination criteria applied, the Secretary failed to show that the subject matter of the
SAFA could not “be properly completed or maintained by the proposed contract.” Id. (quoting
25 U.S.C. § 5321(a)(2)(C)). Having explained those findings, the representative then directed
the parties to “convene and make a good faith effort, on a government-to-government basis, to
develop a CY2020 SAFA that complies with the statutory requirements at” 25 U.S.C. § 5329.
Id. at 6. In the meantime, the representative ordered, the 2019 SAFA would remain in place. Id.
Because the Nation did not appeal the representative’s decision within thirty days, it became
final on March 30, 2020. 25 C.F.R. § 900.157.
On April 4, 2020, the Nation filed the instant Complaint, Dkt. 1, which alleged that the
Secretary had “not complied with the Decision of the Secretary’s Designated Representative.”
Compl. ¶ 17. The Complaint seeks declaratory and injunctive relief under 25 U.S.C. § 5331(a),
see Compl. ¶¶ 25–26, which authorizes tribes to challenge “any action by an officer of the
United States” that is “contrary to this chapter”—i.e., ISDEAA, 25 U.S.C. § 5331(a). Among
other things, the Complaint requests that the Court “compel[] the Defendants to approve the
2020 SAFA and Statement of Work as proposed by the Nation on September 28, 2019 and to
immediately award and provide applicable funding of at least $717,736.77.” Compl. ¶ 26.
On June 10, 2020, the Secretary awarded the Nation $740,341.00 for direct program
expenses “[i]n accordance with the Recommended Decision.” Pl.’s Mot. Ex. 1 at 2, Dkt. 12-1.
The Secretary also informed the Nation that the 2019 SAFA “will remain in place” pending the
negotiations described in the Recommended Decision. Id. In response, the Nation told the
Secretary that it believed the continuance of the 2019 SAFA to be “contrary to law.” Pl.’s Mot.
Ex. 2 at 1, Dkt. 12-2; see also Pl.’s Mot. Ex 3. at 1–2, Dkt. 12-3.
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On September 25, 2020, the Nation moved for summary judgment, Dkt. 12. On
November 4, 2020, the Secretary cross-moved for summary judgment, Dkt. 13. In the Nation’s
memorandum supporting its motion, the tribe acknowledges that the dispute over its funding
level is now “moot,” on account of the Secretary’s June 10 award. Pl.’s Mot. at 1; see also Pl.’s
Mem. in Supp. of Summ. J. at 8 (“there is no longer any issue as to the amount of funding to be
provided pursuant to the 2020 SAFA”). As such, the only issue remaining in this case is whether
the Secretary must approve the Nation’s proposed language for the 2020 SAFA.
This Court has subject-matter jurisdiction under § 5331(a), which confers original
jurisdiction over any “claim against the [] Secretary arising under” ISDEAA. The Nation has
standing to sue because the continued effect of the 2019 SAFA limits the manner in which the
tribe may expend its resources, see Compl. Ex. A at 25, and because that limit is an injury that is
particularized, imminent, and concrete. See Lujan v. Defs. of Wildlife, 504 U.S. 555, 560–61
(1992). Finally, the pending motions are ripe for review.
II. LEGAL STANDARD
A court grants summary judgment if the moving party “shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Fed.
R. Civ. P. 56(a); see also Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247–48 (1986). A
“material” fact is one with potential to change the substantive outcome of the litigation. See
Liberty Lobby, 477 U.S. at 248; Holcomb v. Powell, 433 F.3d 889, 895 (D.C. Cir. 2006). And a
dispute is “genuine” if a reasonable jury could determine that the evidence warrants a verdict for
the nonmoving party. See Liberty Lobby, 477 U.S. at 248; Holcomb, 433 F.3d at 895. “If there
are no genuine issues of material fact, the moving party is entitled to judgment as a matter of law
if the nonmoving party ‘fails to make a showing sufficient to establish the existence of an
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element essential to that party’s case, and on which that party will bear the burden of proof at
trial.’” Holcomb, 433 F.3d at 895 (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)).
III. ANALYSIS
Under ISDEAA and its implementing regulations, the Secretary “shall” approve a
proposed AFA within ninety days “unless” he makes one of the showings listed in § 5321(a)(2).
25 U.S.C. § 5321(a)(2); see also 25 C.F.R. § 900.22. These provisions further require that the
Secretary’s factual findings must be “clearly demonstrate[d]” and his legal conclusions must be
“supported by a controlling legal authority.” 25 U.S.C. § 5321(a)(2). Here, the Secretary denied
the Tribe’s 2020 SAFA on the grounds that its terms could not be “properly completed” under
the contract, 25 U.S.C. § 5321(a)(2)(C), and that the Nation requested funds over “the applicable
funding level,” id. § 5321(a)(2)(D). But a representative of the Secretary reached contrary
conclusions on both issues, which became final for the agency in March 2020. See 25 C.F.R.
§ 900.157. And even now, the Secretary does not argue that its initial denial either “clearly
demonstrated” its factual basis or adequately “supported” its legal conclusions, as § 5321(a)(2)
and its regulations mandate. Instead, the Secretary disputes whether § 5321(a)(2) applies at all in
these circumstances, see Defs.’ Mem. at 14, Dkt. 13-1, and if it does, whether its remedies apply,
see Defs.’ Reply at 5, Dkt. 17. The Secretary is incorrect on both fronts.
The plain text of the section sets up a simple dichotomy: the Secretary “shall” approve a
proposed contract “unless” he satisfies certain conditions. 25 U.S.C. § 5321(a)(2). “[T]he word
‘shall’ usually connotes a requirement,” Kingdomware Techs., Inc. v. United States, 136 S. Ct.
1969, 1977 (2016), and no language in § 5321(a) diffuses that presumption. Further, although
ISDEAA contains one exception from the above dichotomy, see id. § 5321(a)(2) (allowing the
Secretary to “extend or otherwise alter the 90-day period” for answering a proposed contract
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with “the voluntary and express written consent of the” affected tribe), the enumeration of that
one exception suggests the absence of others, see Russello v. United States, 464 U.S. 16, 23
(1983). Finally, allowing the Secretary to resume negotiations over a proposal after having
erroneously denied the same proposal would render § 5321(a)(2)—and its requirement to either
approve such proposals or adequately justify their denial—“superfluous in all but the most
unusual circumstances.” TRW Inc. v. Andrews, 534 U.S. 19, 29 (2001). Thus, because the
Secretary did not satisfy the “unless” clause of § 5321(a)(2), the section’s “shall” clause requires
him to approve the proposed SAFA.
The remedies provided by § 5321(a)(2) apply here, even though the Tribe invoked the
statute’s informal conference process, rather than its other appeal provisions. The purpose of an
informal conference is to review the Secretary’s initial denial of a proposed contract, see 25
C.F.R. §§ 900.153, 900.155, which is governed by § 5321(a)(2). And when a federal statute
limits the remedies available in an initial adjudication, the default rule is that the same limit
applies on appeal of that adjudication. See, e.g., 5 U.S.C. § 557(b) (“On appeal from or review
of the initial decision, the agency has all the powers which it would have in making the initial
decision except as it may limit the issues on notice or by rule.”). Here, no statute expands the
remedies available in an informal conference beyond those listed in § 5321(a)(2). See Defs.’
Reply at 5. And the Secretary may not, through regulation, expand the remedies that Congress
has made available by statute. See Alexander v. Sandoval, 532 U.S. 275, 291 (2001). Thus, the
remedies available to the Secretary were restricted to those set forth in § 5321(a)(2).
The Secretary’s remaining arguments do not persuade, see Defs.’ Mem. at 10–13. First,
the Nation did assert the claims it presses here. See Compl. ¶ 20 (“[w]here the [Secretary]
declines a proposal on a ground that is legally insufficient, the result is that the proposal is
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approved”); id. ¶ 21 (“[b]ecause the [Secretary’s] grounds for declining the Nation’s 2020 SAFA
were legally insufficient, the SAFA . . . [is] approved as a matter of law”). And by alleging that
the Secretary’s initial decision was “legally insufficient” and by requesting “injunctive relief
compelling the Defendants to approve the 2020 SAFA,” see id. ¶¶ 21, 26, the complaint
necessarily challenged the Recommended Decision, which, first, affirmed the initial decision
insofar as it left the 2019 SAFA in place and, second, would be modified by the requested relief.
This case thus bears no resemblance to those in which this Court has declined to reach “new
claims . . . not raised in the complaint.” Quinn v. District of Columbia, 740 F. Supp. 2d 112, 130
(D.D.C. 2010) (brackets omitted); see id. (“Plaintiffs did not plead a common law claim of
promissory estoppel in their Complaint nor does the Complaint contain any suggestion that
Plaintiffs intended to assert such a claim.”); Winder v. District of Columbia, 555 F. Supp. 2d 103,
109 (D.D.C. 2008) (“Count IX of the complaint does not plead a breach of contract claim based
on any earlier contracts, [so] Winder’s attempt to add such a claim through summary judgment
briefing is impermissible.”); Sharp v. Rosa Mexicano, D.C., LLC, 496 F. Supp. 2d 93, 97 n.3
(D.D.C. 2007) (The plaintiff could not raise “additional violations of the ADA not mentioned in
the complaint.”).
Second, the Nation did not forfeit its challenge to the renegotiation required by the
Recommended Decision by seeking to enforce the decision in another respect, see Defs.’ Mem.
at 12. As discussed above, the Nation argued that the decision required the Secretary to provide
it $717,736.77 for direct program expenses. See Compl. ¶¶ 15–17. At the same time, the Nation
challenged the decision’s command that the parties suffer the 2019 SAFA until they negotiate
updated terms. See Compl. ¶¶ 20–21, 26. Without citing any legal authority, the Secretary
argues that the tribe “should not be able to represent that an agency action is final and
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enforceable” in one respect, only to “seek an injunction against the same agency action” in the
same case. Defs.’ Mem. at 12. But there is nothing unusual about relying on one part of an
agency action while challenging another. The Administrative Procedure Act (APA)
contemplates that very course by creating a cause of action to challenge “agency action,” 5
U.S.C. § 702, and defining “agency action” to include “a part of an agency rule, order, license,
sanction, relief, or the equivalent or denial thereof,” id. § 551(13) (emphasis added).
Finally, the Tribe did not forfeit any challenge to the Recommended Decision by failing
to challenge it within thirty days, see Defs.’ Reply at 5–6. The Secretary invokes 25 C.F.R.
§ 900.157, which provides the outcome of an informal conference becomes “final” if it is not
appealed within that time, then reads the word “final” to mean unreviewable. See id. But in the
administrative context, the word “final” instead describes a prerequisite to judicial review. With
exceptions not relevant here, the APA authorizes judicial review of “final agency action for
which there is no other adequate remedy in a court.” 5 U.S.C. § 704. An agency’s decision is
final, in this respect, when it “mark[s] the consummation of the agency’s decisionmaking
process” and when it is “one by which rights or obligations have been determined, or from which
legal consequences will flow.” Bennett v. Spear, 520 U.S. 154, 177–78 (1997) (internal
quotation marks and citations omitted). Against that backdrop, Congress has regularly specified
both the conditions on which an agency action will become “final” and those on which that
action will later be subject to judicial review. See, e.g., 42 U.S.C. § 1395oo(f)(1) (providing,
first, that a “decision of the Board shall be final unless the Secretary . . . reverses, affirms, or
modifies the Board’s decision” and, second, that certain parties “shall have the right to obtain
judicial review of any final decision of the Board”). So too here. Section 900.157 indicates that
recommended decisions both mark the consummation of the Secretary’s decisionmaking and
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determine tribes’ rights under their contracts. See Bennett, 520 U.S. at 177–78. Thereafter, §
5331(a) of ISDEAA authorizes the review of recommended decisions in federal court. See 25
U.S.C. § 5331(a) (allowing judicial review of any “claim against the . . . Secretary arising under”
ISDEAA); see also id. § 5321(b)(3) (emphasizing that a tribe “may, in lieu of filing [an
administrative] appeal, exercise the option to [immediately] initiate an action in a Federal district
court”). Nothing in this familiar scheme bars the Nation’s complaint, which properly challenges
the Recommended Decision pursuant to § 5331(a).
Because § 5321(a)(1) requires that the Nation’s 2020 Successor Annual Funding
Agreement be approved, the Secretary shall approve it.
CONCLUSION
For the above reasons, the plaintiff’s Motion for Summary Judgment, Dkt. 12, is
GRANTED and the government’s Cross-Motion for Summary Judgment, Dkt. 13, is DENIED.
A separate order consistent with this decision accompanies this memorandum opinion.
________________________
DABNEY L. FRIEDRICH
United States District Judge
September 16, 2021
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