The opinion of the court was delivered by: Charles J. Siragusa United States District Judge
This action presents the question whether Seneca County ("Defendant") may foreclose on real property owned by the Cayuga Indian Nation of New York ("Plaintiff") for failure to pay ad valorem property taxes. Now before the Court is Plaintiff's application for preliminary injunctive relief, enjoining Defendant from foreclosing on the subject parcels, on the grounds of tribal sovereign immunity. (Docket No. 4). For the reasons that follow, the application is granted.
Plaintiff is a federally-recognized Indian Tribe which owns real property in Seneca County. The subject dispute involves land that was formerly part of the 64,000-acre Cayuga Reservation acknowledged by the Treaty of Canandaigua in 1794. Shortly after 1794, the Cayuga Nation sold large portions of the Reservation lands to the State of New York. Plaintiff maintains that such sales were illegal and void ab initio, since they did not comply with the requirements of the Non-Intercourse Act, 25 U.S.C. § 177. Plaintiff contends, therefore, that the entire 64,000-acre Cayuga Reservation remains intact to this day. Amended Complaint [#9] at ¶ 10. Defendant disagrees.
Approximately two centuries after selling off the Reservation land to the State of New York, Plaintiff began purchasing parcels of property on the open market that lie within the geographic area of the aforementioned Reservation. Plaintiff contends that such properties are now Reservation land and are "Indian Country" within the meaning of federal law. See, Amended Complaint [#9] at ¶ ¶ 7-10. Defendant again disagrees.
The subject action involves five*fn1 such parcels of property located in Seneca County, which were originally included in the Reservation, but which were later sold to third parties, and then re-purchased by Plaintiff. Defendant has attempted to collect ad valorem property taxes on the parcels, and Plaintiff has denied any obligation to pay them. As a result, Defendant initiated foreclosure proceedings, pursuant to Article Eleven of the New York State Real Property Tax Law.
On January 5, 2011, Plaintiff commenced this action, seeking permanent declaratory and injunctive relief. At the same time, Plaintiff made the subject application for preliminary injunctive relief, enjoining the County from foreclosing on the properties. Plaintiff contends that it is entitled to injunctive relief because the foreclosure actions are barred by sovereign immunity. Specifically, Plaintiff contends that "[a]s a federally-recognized Indian nation, [it] possess[es] tribal sovereign immunity [from suit], which bars administrative and judicial proceedings against the [Indian] Nation," even if the taxes are properly owed.*fn2 In that regard, Plaintiff relies, in large part, on the Second Circuit's decision in Oneida Indian Nation of New York v. Madison County and Oneida County, 605 F.3d 149 (2d Cir. 2010) ("Oneida").
The Court granted Plaintiff's request for an expedited hearing, and scheduled the matter to be heard on January 13, 2011. However, the parties agreed to stay the foreclosure proceedings, and stipulated to a briefing schedule, thereby mooting the request for an expedited hearing.
On February 3, 2011, Defendant filed opposing papers. Defendant observes that after Plaintiff's application was filed, the U.S. Supreme Court vacated and remanded the Second Circuit's Oneida decision, and argues that such decision now "has no precedential value whatsoever." Spellane Aff. [#12-1] at 2. Defendant contends, inter alia, that the Second Circuit's opinion was incorrectly decided in any event, since it was contrary to Supreme Court precedent, most notably County of Yakima v. Confederated Tribes and Bands of the Yakima Indian Nation, 502 U.S. 251, 112 S.Ct. 683 (1992) ("Yakima") and and City of Sherrill v. Oneida Indian Nation of New York, 544 U.S. 197, 125 S.Ct. 1478 (2005) ("Sherrill"). According to Defendant, Yakima established that tribal sovereign immunity does not bar in rem property tax foreclosure proceedings against property owned by an Indian tribe, while Sherrill held that an Indian tribe cannot revive its sovereign authority over land by purchasing it after years of inaction.*fn3
On May 5, 2011, counsel for the parties appeared before the undersigned for oral argument.
Plaintiff seeks an injunction enjoining the state-court tax foreclosure proceeding, pursuant to the All-Writs Act, 28 U.S.C. § 1651(a) (Providing that federal courts "may issue all writs necessary or appropriate in aid of their respective jurisdictions and agreeable to the usages and principles of law."); see also, 28 U.S.C. § 2283 (A federal court may grant an injunction to stay state court proceedings "where necessary in aid of its jurisdiction, or to protect or effectuate its judgments."). The parties dispute whether tribal sovereign immunity applies, and therefore disagree as to whether the Court should enjoin the state court proceedings.
A lengthy discussion is unnecessary, since, according to the Second Circuit's Oneida decision, Supreme Court precedent clearly determines the outcome of this motion, and holds as follows: Even assuming that Seneca County has the right to impose property taxes on the subject parcels owned by the Cayuga Indian Nation, it does not have the right to collect those taxes by suing to foreclose on the properties, unless Congress authorizes it to do so, or unless the Cayuga Indian Nation waives its sovereign immunity from suit. Congress has not authorized Seneca County to sue the Cayugas, and the Cayugas have not waived their sovereign immunity. Consequently, the Cayugas' motion for an order enjoining the foreclosure actions must be granted.
The cases upon which the foregoing paragraph rests are well-known to the litigants and to the courts that will undoubtedly be called upon to review this Court's ruling. For the benefit of anyone reading this decision who is not familiar with them, and who may be understandably ...