Dreveskracht on “Keeping Tribal Business Partners Close – and Their Lawyers Closer”

Ryan Dreveskracht has written a short paper for publication on Turtle Talk titled “Keeping Tribal Business Partners Close – and Their Lawyers Closer”: Keeping Tribal Business Partners Close – and Their Lawyers Closer.

The paper is intended for tribal attorneys, and details some of the lessons tribal lawyers can learn from two recent cases involving the Seminole Tribe of Florida (Everglades Ecolodge and Contour Spa). In both cases, argues Dreveskracht, attorneys for the non-Indian business interests didn’t do their Indian law due diligence, and in the adversarial proceedings that followed in court, the Tribe pounced:

Of course, waiving tribal sovereign immunity where appropriate is always one option, but this is not always feasible. In Contour Spa and Everglades, for example, the Tribe had in fact waived its sovereign immunity via its contract with the non-Indian parties. In those cases, ultimately, the fault rested with those parties tasked with overseeing the negotiation and maintenance of those business transactions.

Dreveskracht believes that tribal lawyers may have some sort of obligation (practical, if not ethical) to make sure that the other side doesn’t fall into any Indian law traps:

Another solution is that tribes, in appropriate instances, ensure that their non-Indian business partners have engaged attorneys that are familiar with the fundamental principles of Indian law. Although this strategy may seem counterintuitive, a tribal party  should pause during the deal to consider the old adage that “bad facts make for bad law,” while also accepting that commercial disputes are inevitable, especially in modern economic times. The tribal party should also pause to consider that it is increasingly appropriate to litigate these disputes on the merits, rather than bank on seeking a quick dismissal on Indian jurisdictional grounds – a dismissal that will very likely result in appeal. There is great potential that the appellate courts will force an exception to a sovereignty-based affirmative defense – and that the exception could swallow the rule. This proverb is particularly true for commercially successful tribes, where the perception of big-business/small-entrepreneur inequality is even more likely to drive bad results in the courts, and in the court of public opinion. Accordingly, the parties and their lawyers should ensure clarity and understanding regarding the various issues of tribal jurisdiction and federal Indian law that are implicated in Indian Country commercial transactions.

I’m largely in agreement with Dreveskracht. When I started practicing in the 1990s, senior attorneys counseled me to draft contract language that would facilitate these kinds of traps. One example involved a private vendor that refused to adjudicate disputes in tribal court, insisting on state court jurisdiction and governing law. We negotiated for federal court review as a “compromise.” Of course, there is no federal subject matter jurisdiction over contract claims just because one of the parties is an Indian tribe. In California especially, cases started coming out in the 2000s where federal court judges were forced to dismiss contract claims, but the federal judges openly criticized tribal lawyers for negotiating those provisions. They frankly are borderline unethical, and may implicate professional responsibility canons.

Business partners are partners before they are adversaries, and tribal businesses depend on goodwill of their own businesses and those of other tribes to create a groundwork for doing business with non-Indian entities. It seems reasonable to rethink the arms-length negotiations strategies in at least some contracts. It may be a difficult pill to swallow for tribal lawyers. Well, face it, most just won’t do it. Lawyers are trained in an adversarial process, and always lean toward strictly assessing risk. Maybe that’s why lawyers are such lousy business people.

This entry was posted in Author: Matthew L.M. Fletcher, Occasional Paper and tagged , , , . Bookmark the permalink.

2 Responses to Dreveskracht on “Keeping Tribal Business Partners Close – and Their Lawyers Closer”

  1. Brian McClatchey says:

    While I agree with the notion of partnerships in business endeavors, and while I have done a good deal of educating my counterparts in Indian law matters, the huge blind spot in this piece is the ethical obligation of the attorney on the other side of the table. Simply put, an attorney who knows nothing about Indian law, but instead relies on the other party’s attorney to familiarize him or her with the subject matter in order to avoid “Indian law traps” is himself acting unethically. Competence is a fundamental duty – get competent, or associate with someone who is. Indian law is no exception, and traps for the unwary only capture the unwary.
    A lawyer who is a finance expert and with whom I am negotiating has no obligation to educate me on the finer points of project finance. If I’m a good lawyer (and I think we all like to think we are), I know what I don’t know. That said, if I thought I may be out of my depth in project finance, I’d go find someone to put on my team who has that expert knowledge. Why should we adhere to a different standard when the subject is Indian law?
    I also “get” that the notion of advocating for your client’s interests can have a wider meaning – you may win that contract negotiation battle, but the ensuing litigation may create a result which ends up undermining your client’s position in the wider context. Even so, I have a very hard time swallowing the notion that zealous advocacy means bolstering the other side’s position.

  2. R.P. says:

    WHY?

    If the end-game is to be adversaries — why even bother, trying to improve things? Why approve nation-building programs, if lawsuits are the end-game? Why add to the tax burden?

    Think about it. John Doe and Jane Doe are a lot smarter than law schools think they are.

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