A. Removal and Remand
Section 1441(b) of the Judicial Code provides: "Any civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution, treaties, or law of the United States shall be removable without regard to the citizenship or residence of the parties." The Court resolves whether to remand after removal by referring to the complaint at the time the petition for removal is filed. Rosenberg v. GWV Travel, Inc., 480 F. Supp. 95, 96 (S.D.N.Y. 1979). For a claim or right to "arise under" the Constitution, treaties, or law of the United States, it must be a necessary element of the plaintiff's claim for relief. Oklahoma Tax Comm'n v. Graham, 489 U.S. 838, 103 L. Ed. 2d 924, 109 S. Ct. 1519 (1989) (citing Taylor v. Anderson, 234 U.S. 74, 75-76, 58 L. Ed. 1218, 34 S. Ct. 724 (1914); Louisville & Nashville R.R. Co. v. Mottley, 211 U.S. 149, 53 L. Ed. 126, 29 S. Ct. 42 (1908)); Franchise Tax Bd. v. Construction Laborers Vacation Trust for So. California, 463 U.S. 1, 9-10, 77 L. Ed. 2d 420, 103 S. Ct. 2841 (1983). As a general matter, an action arises under federal law if federal law creates the cause of action. Merrell Dow Pharmaceuticals, Inc. v. Thompson, 478 U.S. 804, 808-09, 92 L. Ed. 2d 650, 106 S. Ct. 3229 (1986). As the party invoking the Court's jurisdiction, claimants bear the burden to establish the propriety of removal. Mermelstein v. Maki, 830 F. Supp. 180, 184 (S.D.N.Y. 1993). If federal jurisdiction is dubious, remand is proper, in part because it prevents parties from winning in federal court, only to have an appellate court reverse for lack of subject matter jurisdiction. See Deats v. Joseph Swantak, Inc., 619 F. Supp. 973, 977 n. 12 (N.D.N.Y. 1985).
B. Claimants' Argument
The Department's complaint, like Investigator Stevens' affidavit, mentions only New York Tax Law § 1845 as a basis for seizing the tractor, trailer, and liquor. If, however, on motions for remand, the Court took complaints at face value, few defendants would succeed in maintaining a federal forum after removal. Claimants contend that the Court could have exercised federal question jurisdiction over this action had the Department filed here because regardless of how the Department framed the action in its complaint, it seized the property under the authority of 18 U.S.C. § 1161. Section 1161 provides that federal criminal laws regulating the possession and distribution of liquor in Indian country are inapplicable "to any act or transaction within any area of Indian country provided such act or transaction is in conformity both with the laws of the State in which such act or transaction occurs and with an ordinance duly adopted by the tribe having jurisdiction over such area of Indian country". In Rice v. Rehner, 463 U.S. 713, 726, 728-29, 77 L. Ed. 2d 961, 103 S. Ct. 3291 (1983), the Supreme Court noted that § 1161 represents a congressional delegation of authority to the States and the Indian tribes to regulate the use and distribution of alcoholic beverages in Indian country.
From the general proposition that states have authority over Indian Nations only by virtue of Congressional grants of authority, claimants derive the argument that because New York obtained its authority to enforce its liquor laws on Indian reservations from § 1161, § 1161 is the statutory authority pursuant to which the Department must have acted when it seized claimants' property. Therefore, claimants would have the Court conclude, the Department's cause of action arises under federal law--§ 1161 "created" the cause of action--and the Court may exercise federal question jurisdiction over the pending matter.
1. Federal Question Jurisdiction
a. Location of Seizure
Claimants' argument, though intriguing, ultimately fails. Although claimants assert that Mr. Sobotka was transporting the liquor to Mohawk Territory when the U.S. Border Patrol stopped him (Mem. Opp. Mtn. Remand at 2), there is no evidence to suggest that the seizures occurred in Indian country. If the seizure occurred outside of Indian country, then the question of whether New York possesses any authority to enforce its liquor laws on Indian reservations, and if so, from what source it derives such authority, is seemingly irrelevant to the issue before the Court. Nowhere in their papers do claimants argue that New York derives from a federal source its right to regulate the importation of liquor into areas of the State other than Indian country, or that the source of its authority to regulate the importation of liquor into non-Indian country changes from state to federal law when Indians own the imported liquor.
Claimants instead seem to presume either that the seizure occurred within Indian country, or that despite § 1161's clear application to "act[s] or transaction[s] within any area of Indian country[,]" the statute applies to Indian-owned liquor located outside of Indian country as well. In the Court's view, the Department's authority to seize Indian-owned liquor outside of Indian country derives from a source other than § 1161, and presumably from New York Tax Law § 1845. A New York appellate court recently reached the same conclusion. See New York State Department of Tax and Finance v. St. Regis Group, 635 N.Y.S.2d 980, 981-82 (N.Y. App. Div. 1995). However, since neither party addressed this ground for remand, the Court will consider other grounds for remand as well.
Claimants argue that federal law preempts New York Tax Law § 1845. In that event, regardless of how the Department framed its complaint, the case would be removable to federal court pursuant to 28 U.S.C. § 1441. See, e.g., Billy Jack For Her, Inc. v. New York Coat Suit, Dress, Rainwear and Allied Workers' Union, 511 F. Supp. 1180, 1187 (S.D.N.Y. 1981). Without citing any case authority, claimants aver that "the prior Court determinations in which the seizures of Indian liquor by the Department . . . pursuant to Tax Law § 1845 were dismissed as the trial courts found federal preemption." (Mem. Opp. Mtn. Remand at 3-4).
Although the Court is unable to locate any cases supporting claimant's assertion, it did find a recent New York case belying it. In Re Matter of 1,750 Cases of Liquor, 633 N.Y.S.2d 702 (N.Y. Sup. Ct. 1995), involved facts strikingly similar to those giving rise to the case at bar. The court first examined the Supreme Court's opinion in Rice, which held that the State of California could require a federally-licensed Indian trader to obtain a state liquor license in order to sell liquor for off-reservation consumption, and then considered federal appellate opinions interpreting and applying Rice. The court went on to hold that:
far from pre-empting state activity . . . federal laws and the judicial glosses thereon make it clear . . . that the State of New York may require Tribal alcoholic beverage distributors to comply with the same provisions of state registration . . . which apply to any other person or entity within New York State who import alcoholic beverages.