Upload
dinhnhu
View
212
Download
0
Embed Size (px)
Citation preview
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
LV 419864580v1
Pamela M. Overton (AZ Bar No. 009062) GREENBERG TRAURIG, LLP 2375 E. Camelback Rd., Ste. 700 Phoenix, Arizona 85016 Telephone: (602) 445-8000 Facsimile: (602) 445-8100 E-mail: [email protected]; [email protected] Mark Tratos (NV Bar No. 1086) (Pro Hac Vice applied for) GREENBERG TRAURIG, LLP 3773 Howard Hughes Parkway, Ste. 400 North Las Vegas, Nevada 89169 Telephone: (702) 792-3773 Facsimile: (702) 792-9002 Email: [email protected] Troy A. Eid (CO Bar No. 21164) (Pro Hac Vice Applied for) GREENBERG TRAURIG, LLP 1200 17th Street, Suite 2400 Denver, CO 80202 Telephone: (303) 572-6500 Facsimile: (720) 904-7621 Email: [email protected], [email protected] Attorneys for Grand Canyon Skywalk Development, LLC.
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF ARIZONA GRAND CANYON SKYWALK DEVELOPMENT, LLC, a Nevada limited liability company,
Plaintiff, v.
‘SA’ NYU WA, Inc., a tribally-chartered corporation established under the laws of the Hualapai Indian Tribe; GRAND CANYON RESORT CORPORATION, a tribally-chartered corporation established under the laws of the Hualapai Indian Tribe; RICHARD WALEMA, SR., WYNONA
NO. 3:12-cv-08030-DGC
RESPONSE IN OPPOSITION TO MOTION FOR JUDICIAL TRANSFER PURSUANT TO LOCAL RULE 42.1
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 1 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
2 LV 419864580v1
SINYELLA, RUBY STEELE, CANDIDA HUNTER, BARNEY ROCKY IMUS, WAYLON HONGA, CHARLES VAUGHN, SR., each individuals and members of the Hualapai Tribal Council; WANDA EASTER and JACI DUGAN, each individuals and Hualapai Indian Tribe employees and HON. JOLENE COONEY and HON. DUANE YELLOWHAWK, each individuals and judges of the Hualapai Tribal Court,
Defendants.
Plaintiff Grand Canyon Skywalk Development, LLC (“GCSD”) respectfully
opposes Defendant ‘Sa’ Nyu Wa, Inc.’s (“SNW”) Motion for Judicial Transfer Pursuant
to Local Rule 42.1 (“Motion for Transfer”). As explained in detail below, the action
seeking confirmation of the arbitration award, No. 12-cv-08183-FJM (the “Arbitration
Confirmation Action”) and the federal action stayed by this Court, No. 3:12-cv-08030-
DGC (“GCSD II”) (collectively, the “Two Actions”): (i) do not arise from substantially
the same transaction or event; (ii) do not call for determination of substantially the same
questions of law; (iii) do not involve substantially the same parties or property; (iv) do not
involve the same patent, trademark, or copyright; and (v) would not entail substantial
duplication of labor if heard by different Judges. In fact, given the very narrow issues
permitted to be considered by the court in the Arbitration Confirmation Action, judicial
efficiency and expediency are best served by keeping the Two Actions separate and
distinct. Accordingly, GCSD asks this Court to deny SNW’s Motion for Transfer. This
Response in Opposition to SNW’s Motion for Transfer (“Opposition to Transfer”) is
supported by the following Memorandum of Points and Authorities, as well as the case
record, incorporated herein by this reference.
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 2 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
3 LV 419864580v1
MEMORANDUM OF POINTS AND AUTHORITIES
I. RELEVANT FACTS
Despite its claims to the contrary, SNW did participate in the arbitration
proceedings, which were governed by American Arbitration Association (“AAA”)
Commercial Arbitration Rules, before arbitrator Shawn Aiken (“Arbitrator Aiken”) for
months after GCSD filed its initial Arbitration Complaint on August 9, 2011. In fact,
SNW filed a seventy-seven (77) page Answer to GCSD’s Arbitration Complaint and
Notice of Intent to Assert Counterclaims on December 1, 2011. Counsel for SNW also
participated in at least seven preliminary hearing teleconferences with Arbitrator Aiken
and undersigned counsel through February 8, 2012. Indeed, SNW only ceased its
participation in the arbitration proceedings after Arbitrator Aiken had to order it to
produce the critical point of sale documents, which SNW has at all relevant times refused
to produce. See, e.g., Report of Preliminary Hearing and Scheduling Order No. 6,
attached hereto as Ex. 1. Immediately after the order from the Arbitrator to produce the
evidence, on February 9, 2012, the Tribe “took” GCSD’s intangible contract rights
through the purported right of eminent domain —six months after the arbitration
proceedings had begun. The “taking” was done pursuant to an unconstitutional
condemnation ordinance it adopted solely for use against GCSD.
In its Motion for Transfer, SNW misrepresents several aspects of the arbitration
proceedings that warrant correction. SNW claims that Arbitrator Aiken “refused to
acknowledge SNW’s sovereign immunity defenses.” Motion for Transfer at 2:26-18.
This is patently untrue. SNW filed a Motion to Dismiss GCSD’s Arbitration Complaint
(“Motion to Dismiss Arbitration”) on November 2, 2011, in which SNW moved for
dismissal exclusively based on its sovereign immunity-related assertions. GCSD
responded in opposition to SNW’s Motion to Dismiss Arbitration on November 18, 2011.
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 3 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
4 LV 419864580v1
After extensive briefing on the issue, Arbitrator Aiken denied SNW’s Motion to Dismiss
Arbitration. See Order dated November 21, 2011, attached hereto as Ex. 2. Thus, far
from “refus[ing] to acknowledge” SNW’s sovereign immunity defense, Arbitrator Aiken
fully considered the issue and only “after reviewing and considering the parties’
submissions . . . denie[d] the objection and confirm[ed] jurisdiction.” Id.
Similarly, SNW also asserts that Arbitrator Aiken “refused to acknowledge” the
Hualapai Nation’s (the “Tribe”) request for termination of the arbitration or right to fire
GCSD lawyers. Once again, this is demonstrably false. After receiving and considering
the Tribe’s demand to terminate the arbitration proceedings, Arbitrator Aiken issued not
one, but two related Orders. In his Order dated March 14, 2012, attached hereto as Ex. 3,
Arbitrator Aiken found that “[t]he Tribe lacks any authority, or permission from any
court, to dismiss [GCSD’s] law firm or certainly this arbitration.” Thus, after
consideration, Arbitrator Aiken denied the Tribe’s notice of dismissal. Id. In an
abundance of caution, in his Supplemental Order dated March 27, 2012 (“March 27th
Order”), attached hereto as Ex. 4, Arbitrator Aiken confirmed his denial of the notice of
dismissal but postponed the final hearing from April 2-13, 2012 until mid-July 2012; in
doing so, he stated that “[u]nless before the hearing date either SNW or the Tribe obtains
an order to the contrary from the Tribal Court or the U.S. District Court, the arbitration
will proceed to final hearing and thereafter final award.” March 27th Order at Ex. 4.
Neither the Tribe nor SNW filed a motion with this Court to halt the arbitration
proceedings. Instead, shortly after the March 27th Order, the Tribe filed a Motion to
Enlarge the Tribal Court’s Temporary Restraining Order to Enjoin Arbitration
Proceedings (“Motion to Enjoin Arbitration”) in Tribal Court on April 2, 2012, and a
Supplemental Motion to Enjoin Arbitration on June 28, 2012. After full briefing and oral
argument, the Tribal Court denied the Tribe’s Motion to Enjoin Arbitration and expressly
ordered that “SNW and GCSD may proceed with the Arbitration as agreed to in the
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 4 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
5 LV 419864580v1
[2003] Development and Management Agreement . . . ” (the “2003 Agreement”). Tribal
Court Order dated July 15, 2012, attached hereto as Ex. 5. The order was signed the day
before the AAA Arbitration commenced.
Given that no court ordered termination of the arbitration proceedings—and, to the
contrary, the Tribal Court expressly authorized the arbitration to proceed—Arbitrator
Aiken conducted the final hearing July 16-20, 2012. GCSD appeared and presented its
proof. SNW, despite full and proper notice, elected not to appear at the final hearing.
AAA Rule 29 (Arbitration in the Absence of a Party or Representative) provides:
Unless the law provides to the contrary, the arbitration may proceed in the absence of any party or representative who, after due notice, fails to be present or fails to obtain a postponement. An award shall not be made solely on the default of a party. The arbitrator shall require the party who is present to submit such evidence as the arbitrator may require for the making of an award.
Under the Revised Uniform Arbitration Act as adopted in Arizona, “[t]he arbitrator may
hear and decide the controversy on the evidence produced although a party who was duly
notified of the arbitration proceeding did not appear.” A.R.S. § 12-3015(C).
After hearing several days of testimony and carefully reviewing and weighing the
evidence, Arbitrator Aiken awarded GCSD a total sum of $28,572,810.25, which consists
of: (i) $24,975,469 for unpaid management and shuttle bus fees for SNW’s breaches of
contract through December 31, 2011; (ii) $100,000 for start and stop costs for SNW’s
breaches of contract through no later than December 31, 2011; (iii) $1,700,000 for
reimbursement for Y Travel employee housing, transportation, and bus advertising for
SNW’s breaches of contract through December 31, 2011; (iv) $800,000 to repair damage
to equipment and site installations for SNW’s breaches of contract through no later than
December 31, 2011; (v) $950,000 for reasonable attorney’s fees; and (vi) $47,341.25 for
costs of arbitration. Phrased differently, the arbitration hearing and award solely relate
to and arise from SNW’s breaches of contract that occurred between 2007 and 2011,
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 5 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
6 LV 419864580v1
i.e. before the illicit condemnation of GCSD’s intangible contract rights in the Grand
Canyon Skywalk (“Skywalk”). GCSD filed an Application for Confirmation of the
Arbitration Award (the “Application for Confirmation”) in the Arbitration Confirmation
Action. For the reasons explained herein, it should remain with Judge Frederick J.
Martone.
II. SNW’S MOTION TO TRANSFER SHOULD BE DENIED BECAUSE THE TWO ACTIONS NEITHER ARISE FROM SUBSTANTIALLY THE SAME TRANSACTIONS OR EVENTS NOR CALL FOR DETERMINATION OF THE SAME QUESTIONS OF LAW.
SNW incorrectly asserts that the Arbitration Confirmation Action arises “from
substantially the same transaction or event” as the two federal actions previously filed
with this Court (Motion for Transfer at 4:12-13); further, while conceding that “there is no
complete overlap,” SNW also wrongly contends that the Arbitration Confirmation Action
and the two previously filed federal actions call for determination of substantially the
same questions of law (id. at 5:17-18). As a preliminary matter, pursuant to Local Rule
42.1(a) (“L.R. 42.1”), only pending actions may be considered in assessing whether to
permit transfer. As this Court is aware, it dismissed the first federal action, No. 3:11-cv-
08048-DGC (“GCSD I”), in June 2011. See Dkt. Nos. 33 and 39. Thus, GCSD I is not
pending before this Court and all of SNW’s arguments relating to GCSD I or “Prior
Actions” (without distinguishing between them) are irrelevant here.1 See L.R. 42.1.
As this Court is also well aware, it has stayed GCSD II. See Dkt. No. 58.
Therefore, there is no pending action for the Arbitration Confirmation Action to be
transferred to. Assuming, without conceding, that a stayed action may qualify as a
pending action, the Arbitration Confirmation Action and GCSD II arise from completely
different transactions or events, and call for a determination of different questions of law. 1 Even if, in arguendo, this were not the case, SNW’s arguments related to GCSD I suffer the
same fatal defects as those discussed herein relative to GCSD II.
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 6 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
7 LV 419864580v1
Importantly, the Arbitration Confirmation Action arose out of SNW’s prior breaches of
the 2003 Agreement, and related questions of law, through no later than December 31,
2011—i.e. well before the Tribe’s illicit condemnation of GCSD’s intangible contract
rights in the Skywalk—and, in contrast, GCSD II arose out of the actual taking, including
related questions of law as to whether the Tribe has such authority and the validity of the
condemnation ordinance itself.2 The two matters have completely different factual and
legal issues.
Moreover, a federal court’s role in reviewing the arbitration award in the
Arbitration Confirmation Action is very narrow. In its Motion for Transfer, SNW
forecasts that it would seek to vacate the arbitration award (which it has since done) by
asserting “jurisdictional questions and contractual interpretation questions under the 2003
Agreement . . ., as well as defenses related exclusively to the Hualapai Tribe’s
condemnation of GCSD’s contractual interests in the 2003 Agreement.” Motion for
Transfer at 3:14-18. As explained in Section I, supra., the issues of jurisdiction and the
Tribe’s ability to halt the arbitration were already fully briefed, considered, and ruled
upon by Arbitrator Aiken. Federal law is well-settled that an arbitrator’s interpretation of
factual and legal questions relating to the parties’ contractual obligations is “entitled to
deferential review.”3 Northrop Corp. v. Triad Int’l Mktg., S.A., 811 F.2d 1265, 1269 (9th
Cir. 1987) (internal citations omitted). This is especially true where, as here, “the legal
issues were fully briefed and argued to the arbitrator[].” Id. To “now subject these
decisions to de novo review would destroy the finality for which the parties contracted
2 Of course, this Court has not heard any evidence as to the merits of GCSD’s claims in GCSD II.
Rather, it has stayed the action and ordered GCSD to exhaust its claims in Tribal Court. See Dkt. No. 58.
3 Indeed, it is axiomatic that an arbitrator’s interpretation of the law is “not subject, in the federal courts, to judicial review for error in interpretation.” Northrop Corp., 811 F.2d at 1269 (internal citation and quotations omitted).
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 7 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
8 LV 419864580v1
and render the exhaustive arbitration process merely a prelude to the judicial litigation[,]”
which the parties contracted to avoid. Id. It should be obvious to this Court that the
Defendants are engaged in nothing more than an overt effort to delay the enforcement of
the award. This Court should prevent the continued gamesmanship of SNW and its
lawyers.
Rather, pursuant to 9 U.S.C. § 10, the court may only vacate an arbitration award
under four circumstances; the lone such circumstance alleged by SNW is: “where the
arbitrators exceeded their powers, or so imperfectly executed them that a mutual, final,
and definite award upon the subject matter submitted was not made.” 9 U.S.C. § 10(4).
Thus, the limited question for the court to answer in the Arbitration Confirmation Action,
before confirming the arbitration award, is: Did Arbitrator Aiken exceed his powers, or so
imperfectly execute them, such that the court may vacate the mutual, final, and definite
arbitration award finding that SNW repeatedly and profoundly breached its obligations to
GCSD under the 2003 Agreement between 2007 and 2011? While the answer to this
question is NO4, it is a discrete issue and legal question that SNW does not—and
cannot—allege arose in GCSD II. The matters before the court in GCSD II had absolutely
nothing to do with this issue.
Pangerl v. Ehrlich, Nos. CV06-1464 PHXMHM, CV 06-1465 HXFJM, 2007 WL
686703, at * 1-4 (D. Ariz. March 2, 2007) is instructive here. In that case, the court
denied plaintiff’s motion to transfer, finding there was an “insufficient basis” to support a
transfer pursuant to L.R. 42.1. Id. at *4. In reaching this conclusion, the court found that
where actions, such as the Two Actions at issue here, are “factually distinguishable”
because the conduct at issue took place several months apart, such acts “are clearly
4 That SNW chose to cease its participation six months into the arbitration proceedings, and after
continuing to receive all necessary and due notice, does not change this result. See AAA R-29 and A.R.S. § 12-3015(C).
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 8 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
9 LV 419864580v1
distinct and do not arise out of substantially the same transaction or event.” Id. at *2.
Similarly, where, as here, the claims in two actions “are based upon different events and
circumstances” they do not call for the determination of substantially the same questions
of law. Id. at *3. The Arbiter determined the past breach of contract damages owed by
SNW; this action sought to prevent the irreparable injury to GCSD caused by
unconstitutionally taking using eminent domain.
In sum, SNW does not allege, nor can it, that there is any similarity—let alone
substantial similarity—between the issues raised in GCSD II and those permitted in the
Arbitration Confirmation Action pursuant to 9 U.S.C. § 10. Further, in light of the well-
established limitations upon the court in actions to confirm arbitration awards, the Two
Actions do not call for determination of substantially the same questions of law.
Accordingly, this Court should deny SNW’s Motion to Transfer.
III. SNW’S MOTION TO TRANSFER SHOULD BE DENIED BECAUSE THE TWO ACTIONS DO NOT INVOLVE SUBSTANTIALLY THE SAME PARTIES OR PROPERTY.
While GCSD and SNW are parties in the Two Actions, GCSD II has twelve more
named defendants than the Arbitration Confirmation Action. By any measure, an action
that contains two parties and another action that contains fourteen parties cannot be said to
involve substantially the same parties. See, e.g., Pangerl, 2007 WL 686703, at *3
(finding that two actions do not involve “substantially the same parties” when there is
only a partial overlap in the parties named).
Further, the Two Actions do not involve substantially the same property. The
property at issue during the arbitration proceedings was primarily monies owed to GCSD
by SNW due to its repeated past breaches of the 2003 Agreement. The property at issue
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 9 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
10 LV 419864580v1
in GCSD II is primarily GCSD’s intangible contract rights to manage the Skywalk from
and since the taking. Thus, this factor also does not support SNW’s request for transfer.5
IV. SNW’S MOTION TO TRANSFER SHOULD BE DENIED BECAUSE SNW HAS FAILED TO SHOW THAT TRANSFER WOULD PROMOTE JUDICIAL ECONOMY.
SNW claims that its Motion for Transfer “is PRIMARILY based upon judicial
economy in avoiding substantial duplication of labor by this Court and the parties in light
of the common factual and legal background of the Arbitration [Confirmation] Action and
[GSCD II].” Motion for Transfer at 2:11-13 (emphasis added). As demonstrated above,
however, the Two Actions: do not arise from substantially the same transaction or event;
do not call for determination of substantially the same questions of law; do not involve
substantially the same parties or property; and, do not involve the same patent, trademark,
or copyright. Thus, SNW has failed to support their sole basis for claiming that it would
be judicially economical to transfer the Arbitration Confirmation Action to this Court.
Accordingly, given the very narrow issues permitted to be considered by the court in the
Arbitration Confirmation Action, as described supra., keeping the Two Actions before
their respective assigned Judges would not entail substantial duplication of labor.
V. CONCLUSION
Based on the foregoing, GCSD respectfully requests that this Court DENY SNW’s
Motion for Transfer.
//
//
//
// 5 If and to the extent the Two Actions involve any intellectual property, they fall under the same
category divisions as the other property at issue. Moreover, SNW does not allege that the Two Actions involve the same patent, trademark, or copyright, which is the test under L.R. 42.1. Thus, this is another factor that does not support SNW’s Motion for Transfer.
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 10 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
11 LV 419864580v1
RESPECTFULLY SUBMITTED this 4th day of October, 2012.
GREENBERG TRAURIG, LLP By: /s/ Pamela M. Overton
Pamela M. Overton 2375 East Camelback Road, Suite 700 Phoenix, AZ 85016
GREENBERG TRAURIG, LLP
Mark Tratos 3773 Howard Hughes Parkway, Suite 400N Las Vegas, NV 89169
GREENBERG TRAURIG, LLP
Troy A. Eid Robert S. Thompson IV 1200 17th Street, Suite 2400 Denver, CO 80202 Attorneys for Plaintiff
.
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 11 of 12
LA
W O
FFIC
ES
GR
EE
NB
ER
G T
RA
UR
IG
2375
EA
ST C
AM
EL
BA
CK
RO
AD
, SU
ITE
700
PH
OE
NIX
, AR
IZO
NA
850
16
(602
) 44
5-80
00
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
12 LV 419864580v1
CERTIFICATE OF SERVICE
I hereby certify that on October 4, 2012, I sent the foregoing application for
confirmation of arbitration award to be personally served on the following:
Glen Hallman Paul K. Charlton Jeffrey D. Gross Christopher W. Thompson GALLAGHER & KENNEDY, P.A. 2575 E. Camelback Road Phoenix, Arizona 85016-9225
/s/ Tammy Mowen Employee of Greenberg Traurig, LLP
Case 3:12-cv-08030-DGC Document 64 Filed 10/04/12 Page 12 of 12
LV 419864629v1
INDEX TO EXHIBITS
RESPONSE IN OPPOSITION TO MOTION FOR JUDICIAL TRANSFER
PURSUANT TO LOCAL RULE 42.1 Exhibit 1 Arbitrator Shawn K. Aiken’s Report of Preliminary Hearing and Scheduling
Order No. 6 dated February 7, 2012 Exhibit 2 Arbitrator Shawn K. Aiken’s Order Re Respondent’s Motion to Dismiss GCSD’s
Arbitration Complaint dated November 21, 2011 Exhibit 3 Arbitrator Shawn K. Aiken’s Order Re: Respondent’s (and Hualapai Nation’s)
Notice of Voluntary Dismissal With Prejudice dated March 14, 2012 Exhibit 4 Arbitrator Shawn K. Aiken’s Supplemental Order: Order by U.S. District Court
Judge Campbell (March 19, 2012) Re Trial Court Exhaustion:: Re-Setting of Final Hearing to July 2012 dated March 27, 2012
Exhibit 5 Honorable Lawrence King, Judge, Hualapai Indian Tribe Minute Entry and Order
dated July 15, 2012
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 1 of 23
AMERICAN ARBITRATION ASSOCIATION
Commercial Panel
No. 76 517 Y 00191 11 SlM
In the Matter of the Arbitration of
Grand Canyon Skywalk Development, LLC
and
'Sa' Nyu Wa, Inc.
REPORT OF PRELIMINARY HEARINGAND SCHEDULING ORDER (No.6)
Shawn Aiken conducted Preliminary Hearing No. 6 VIa telephone on
Wednesday, February 1, 2012, beginning at 11:00 a.m. MST. Attorneys Mark Tratos
Donald Prunty, and Pamela Overton appeared for Claimant Grand Canyon
Skywalk Development, LLC. Attorney Glen Hallman appeared for Respondent 'Sa'
Nyu Wa, Inc. Our case manager, Ms. Lynn Cortinas, started the call.
1. Report on Status of Document Production. Counsel discussed
production of records by each side and responses to subpoenas from third parties.
The parties agreed to submit their separate statements of positions on the current
discovery disputes, including the scope of the subpoena to Wells Fargo and the point
of sale documentation, no later than February 8, 2012. We will discuss those
papers on our next telephone call at 11:00 a.m. (ArizonaJMST) on February 9,
2012. The decision will follow on or very shortly after February 13, 2012. In the
meantime, Mr. Hallman reported, the Tribe will make all good faith efforts to
produce certain point of sale documentation by February 10, 2012. Near the end of
the call, the parties agreed that each side would produce point of sale information
related to ticket sales. The only question appeared to be whether those records
would reflect monthly or yearly data. Counsel agreed that daily records were not
needed for production but available only for review, if needed.
S:\AAA-SKA\Current\29914001 Grand Canyon v. 'Sa' Nyu Wa\Pleadings\PrelimHrgReport6 120207.doc
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 3 of 23
2. Status of Deposition Scheduling. The parties have not discussed or
confirmed the schedule for expert or lay depositions. As Mr. Hallman pointed out,
the expert witnesses must review the reports and other data related to ticket sales.
Counsel will discuss, agree upon, and submit their joint prehearing schedule,
including proposed dates for depositions. The four-hour presumptive limit will apply
to non-parties and the seven-hour presumptive limit to parties and principals of
parties.
3. Agreed Upon Modification To Subpoenas. Mr. Prunty and Mr.
Hallman agreed that the parties will produce responsive documents related to the
skywalk operations. Mr. Prunty will draft and Mr. Hallman will review the
proposed language modifying the subpoenas, which they will submit to the
arbitrator no later than Wednesday, February 8, 2012.
4. Payment to Accountant. The parties continue to dispute the
payment to the accountant (Ms. Jan Allen). Mr. Hallman reports that his client
made the payment ordered by the Tribunal, but she did not provide the required
information, Mr. Hallman explained. The parties will submit their positions on this
dispute for hearing on February 9th and resolution by the Tribunal thereafter.
5. Preliminary Hearing No.7. Our case manager will arrange for and
confirm our next telephonic preliminary hearing on February 9, 2012 at 11:00
a.m. (ArizonalMST). During that hearing" the arbitrator will confirm the pre-
hearing schedule (if not agreed upon) and resolve any outstanding discovery
disputes.
Dated: February 7, 2012Phoenix, Arizona
/ s / Shawn K. AikenShawn K. Aiken, Arbitrator
S:\AAA,SKA\Current\29914001 Grand Canyon v, 'Sa' Nyu Wa\Pleadings\PrelimHrgReport6120207,doc
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 4 of 23
AMERICAN ARBITRATION ASSOCIATION
Commercial PanelNo. 76 517 Y 0019111 SlM
In the Matter of the Arbitration of
Grand Canyon Skywalk Development, LLC
and
'Sa' Nyu Wa, Inc.
ORDER RE RESPONDENT'S MOTION TO DISMISSGCSD'S ARBITRATION COMPLAINT
On November 4, 2011, respondent Sa Nyu Wa, Inc., a Haulapai Indian
Tribally chartered corporation, formally objected to the tribunal's jurisdiction (based
on the Hualapai Nation's claim of and refusal to waive sovereign immunity). On
November 18, 2011, claimant responded. After reviewing and considering the
parties' submissions, the tribunal denies the objection and confirms jurisdiction.
Respondent 'Sa' Nyu Wa, Inc. (SNW) contends that the tribunal must dismiss
claimant Grand Canyon Skywalk Development, LLC's (GCSD) demand for
arbitration on grounds of sovereign immunity. SNW argues that GCSD must first
comply with Section 15.4 of the 2003 Development and Management Agreement,
which, SNW urges, requires first an order from an Arizona federal court compelling
SNW to arbitrate. And, SNW argues, the Hualapai Tribal Court's August 2d order
to this same effect precludes GCSD from re-litigating the issue here.
GCSD points out in response that an agreement to arbitrate constitutes the
required waiver of sovereign immunity. Second, the Court of the Hualapai Nation
determined that it lacked subject matter jurisdiction. Following motion practice, the
Tribal Court found that it was "deprived of jurisdiction." Order (8.2.11), at 2. Thus,
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 6 of 23
GCSD argues, its judgment was void and, in any event, not on the merits.
The controlling 2003 Development and Management Agreement provides in
section 15.4 in part as follows:
15.4 Arbitration, Governing Law, Jurisdiction
(a) Mandatory Arbitration. Any controversy, claim or disputearising out of or related to this Agreement shall be resolvedthrough binding arbitration . .. Either party may request andthus initiate arbitration of the dispute by written notice("Arbitration Notice") to the other party .... The arbitrationshall be conducted in accordance with the CommercialArbitration Rules of the American Arbitration Association thenin effect, as limited by Section 15.4(d). Judgment upon theaward (as limited by Section 15.4(d» rendered by the arbitratormay be enforced through appropriate judicial proceedings in anyfederal court having jurisdictionLl
Agreement, at 42-43. Section 15.4(d) of the Agreement provides for SNW's waiver of
sovereign immunity from suit but limited to three actions or remedies, including
"[a]n action in a federal court of competent jurisdiction in Arizona to either (i)
compel arbitration or (ii) enforce a determination by an arbitrator requiring SNW to
specifically perform any obligation" under the Agreement.
Federal and state courts, including the U.S. Supreme Court, read nearly
identical arbitration provisions as a waiver of sovereign immunity. See Response, at
6-9 (citing and discussing authorities, including C & L Enterprises, Inc. v. Citizen
Band of Potawatomi Indian Tribe of Oklahoma, 532 U.S. 411 (2001». After all, the
agreement to arbitrate would otherwise make little sense.
Second, Section 15.4(d) does not require an order from the federal court to
arbitrate. Instead, the parties agreed that one or the other party may first file an
action in federal court and seek an order compelling arbitration, but, under section
15.4(a), either party may likewise first request arbitration by filing a demand with
the American Arbitration Association. Here, claimant chose the latter course. In
some circumstances, parties may wish to first file in federal court because certain
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 7 of 23
tactical advantages follow, but neither the Agreement nor the law requires that
course.
Finally, on August 2d, the Court of the Hualapai Nation granted SNW's
motion to dismiss and found that the Court lacked jurisdiction. In these
circumstances, long-settled preclusion law requires a final judgment from a court
with subject matter jurisdiction. The tribal court lacked jurisdiction. Thus, its order
carries no preclusive effect.
The tribunal denies SNW's Motion to Dismiss GCSD's Arbitration
Complaint.
Dated: November 21,2011Phoenix, Arizona
/s/ Shawn K. AikenShawn K. Aiken, Arbitrator
S:\AAA-SKA\Current\29914001 Grand Canyon v. 'Sa' Nyu Wa\Pleadings\OrderReJurisdiction_doc
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 8 of 23
AMERICAN ARBITRATION ASSOCIATION
Commercial PanelNo. 76 517 Y 00191 11 SIM
In the Matter of the Arbitration of
Grand Canyon Skywalk Development, LLC
and
'Sa' Nyu Wa, Inc.
Order Re: Respondent's (and Hualapai Nation's) Notice of Voluntary
Dismissal With Prejudice
The Haulapai Nation claims to own the interests at issue through
recent condemnation and, therefore, stepped into the shoes of Mr. Jin and his
counsel, dismissed counsel for claimant, and filed its notice of voluntary
dismissal. In February 2012, counsel for respondent, Mr. Glen Hallman,
wrote to the American Arbitration Association, on behalf of the Hualapai
Nation, confirming dismissal of this arbitration (because, he contended,
attorneys Tratos and Prunty were no longer authorized to represent claimant
Grand Canyon Skywalk Development, LLC) after the Tribe had condemned
the claim at issue. Mssrs. Tratos and Prunty, who confirm that they
nevertheless represent GCSD, oppose the notice of dismissal.
First, may the tribunal decide the question. Second, may the Tribe - a
non-party - dismiss counsel for claimant in the absence of an attorney-client
relationship and in the teeth of claimant's confirmation that the Greenberg
firm still acts as its lawyers. I take up each issue in turn.
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 10 of 23
First, who should decide the merits issue -- the arbitrator or a court?
There appear to be no cases directly on point. In Northwestern Nat. Ins. Co. v.
Insco, Ltd., 2011 WL 4552997 (S.D.N.Y. 2011), the court held that under New
York law the disqualification of a law firm from representing a party in a
pending arbitration is an issue for the court and not for the arbitrators. See
also Employers Ins. Co. of Wausau v. Munich Reinsurance America, Inc., 2011
WL 1873123 (S.D.N.Y. 2011)(holding that there was scant authority on the
issue of whether the disqualification of an attorney from arbitration is a
matter left to the arbitrators or the court; the issue is for judicial
determination); cf. SOC-SMG, Inc. v. Day & Zimmerman, Inc., 2010 WL
3634204 (Del. Ch. 2010) (in a petition to disqualify counsel and dismiss all
claims and defenses in arbitration for alleged misuse of confidential
information, the court held that these issues were to be determined by the
arbitrators, reasoning that the arbitrators handling the arbitration were well
positioned to consider any contractual or ethical breach that allegedly
deprived the party of its legitimate confidentiality interests and to shape
consequences for any breach by opposing counsel of its ethical duties and to
have the court inject itself into the situation would show disrespect toward
the arbitration panel, which has the broad authority to address these issues
in the first instance). Despite the dearth of authority, and by analogy to at
least one well-reasoned disqualification case, the tribunal turns to the merits.
May the Hualapai Tribe - a non-party to this arbitration - dismiss
counsel for claimant, and then dismiss the arbitration, with prejudice, in the
absence of an attorney-client relationship, and in the teeth of claimant's
confirmation that the Greenberg firm still acts as its lawyers, following a
notice of condemnation under the Tribal ordinance? Before turning to that
question, some brief background is in order.
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 11 of 23
Mr. David Jin agreed to finance, develop, and operate the Grand
Canyon Skywalk project. The parties would, they agreed, share revenue from
the project. The Nation formed the 'Sa' Nyu Wa entity (SNW), a tribally-
chartered company, to enter into this revenue-sharing and development
agreement with Mr. Jin. The Nation is the sole shareholder of SNW. With
these purposes in mind, in late 2003, the parties entered into their
Development and Management Agreement. Mr. Jin also formed a company to
manage the Skywalk.
The early phases of the project were completed and, in March 2007, the
Skywalk opened to the public. Soon, disputes developed over the
management of the project, including the division of revenues. In March
2010, the parties entered into a trust agreement that, among other things,
provided for the deposit of so-called "new" Skywalk ticket revenue into a trust
account at U.S. Bank. Today, that trust account holds over $10 million, which
apparently represents ticket revenues for 2010 and 201l.
The Agreement provided that disputes between the parties would be
decided under the rules of the American Arbitration Association. In late
2011, after having emerged from Hualapai Tribal Court, claimant Grand
Canyon demanded arbitration. Here, in arbitration, the parties dispute the
distribution of and rights to, among other things, the trust account revenue
(and many other issues) arising from the operation of the Skywalk since
2007.
With that background in mind, Grand Canyon argues that the Tribe
lacks power to condemn any property or right because the Nation may not
assert eminent domain over a non-Indian or its property (see Response, at 15-
18) and the governing tribal ordinance is unconstitutional (see Response, at
18-25). But, I need not (and cannot) reach these issues. Rather, those issues
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 12 of 23
must be resolved by the court or courts with jurisdiction over the subject
matter and the parties - Grand Canyon and the Tribe - including the federal
district court or perhaps even the tribal court.
In any event, the rules of the Large, Complex Case Panel of the
American Arbitration Association control here. See Report of Preliminary
Hearing No.1, at ~1 (10.31.11). The parties before this tribunal remain the
claimant and the respondent. No court has ordered otherwise. The Tribe, a
non-party to the arbitration, has made no request to intervene and in fact
refused to waive sovereign immunity in related proceedings. The Tribe lacks
any authority, or permission from any court, to dismiss Grand Canyon's law
firm or certainly this arbitration. In other words, the Tribe has no authority
to "dismiss" the arbitration without the consent of the claimant and its
counsel of record, Mr. Tratos, Mr. Prunty, and Ms. Overton at the Greenberg
Traurig firm. They do not consent.
The tribunal DENIES the notice of dismissal. The matter shall proceed.
The final hearing remains scheduled for April 2012 unless otherwise ordered
or agreed. Counsel and the arbitrator will convene for our status call on
Thursday, April 15, 2012, at 2:00 p.m. (MST)(888.537.7715 and passcode:
25249171#).
Dated: March 14, 2012Phoenix, Arizona
/ s/ Shawn K. AikenShawn K. Aiken, Arbitrator
S:'\AAA-SKA\Current\29914001Grand Canyonv. 'Sa' NyuWa\Pleadings\OMTDismiss1203t;©ftally signed by Shawn
Shawn AikenON: cn=Shawn Aiken,o=Aiken Schenk et aI., au,[email protected],c=USDate: 2012,03.1416:07:57-07'00'
Aiken
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 13 of 23
AMERICAN ARBITRATION ASSOCIATION
Commercial PanelNo. 76 517 Y 00191 11 SIM
In the Matter of the Arbitration of
Grand Canyon Skywalk Development, LLC
and
'Sa' Nyu Wa, Inc.
SUPPLEMENTAL ORDER :: ORDER BY U.S. DISTRICT COURT JUDGECAMPBELL (MARCH 19.2012) RE TRIBAL COURT EXHAUSTION :: RE-
SETTING OF FINAL HEARING TO JULY 2012
In their 2003 Skywalk Agreement, the parties chose this forum. More
recently, under the Agreement and the controlling rules, the tribunal confirmed its
own jurisdiction. The question now, though, is whether the Hualapai Tribe's
condemnation ordinance altered the parties' choice of forum. SNW argues that the
tribal ordinance permitted and the declaration of taking confirmed the taking of the
claims at issue here. In his March 22, 2012 letter to Ms. Sandra Marshall, Mr.
Hallman, counsel for SNW and the Hualapai Tribe, contends that "[t]he Tribe is
now the owner of GCSD's contract rights [at issue here] pursuant to the declaration
of taking and Section 2.16 of the Hualapai Law and Order Code." Letter, at 3. GCSD
contends that the taking was invalid in the first instance because the ordinance
itself was unconstitutional and, even if valid in all other respects, cannot reach the
claims at issue here.
The parties in recent weeks began litigation on this and related questions in
U.S. District Court (CV 12-08030-PCT-DGC). The federal court denied GCSD's
application for temporary restraining order because GCSD must first exhaust its
remedies in Tribal Court. See Order (Doc. 54), at 14 ("comity compels the Court to
require that Plaintiff exhaust its remedies in Tribal Court."). The Tribal Court, not
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 15 of 23
the federal court, must first consider the lawfulness of the Tribe's condemnation
action, Judge Campbell confirmed, so the parties now move to Tribal Court where
the parties presumably would litigate and receive resolution of at least the following
questions: (1) whether sections 2.16(B), subparts (1) through (14), of the Hualapai
Law and Order Code and Tribal Council Resolution No. 15-2012 pass constitutional
muster; if so, (2) whether the claims at issue here fall within the scope of the
Declaration of Taking (Case no. 2012-CV-017); and, if so, (3) whether for any other
reason this arbitration should not proceed to final award. In the meantime, the
condemnation ordinance, which provided that "the Tribe shall be the party [to an
intangible contract] in the full place and stead of the defendant[,]" remains in effect.
See Hualapai Law and Order Code, Sec. 2.16(4)(a).
Judge Campbell's order did not enjoin this arbitration. Mr. Hallman
nevertheless pointedly observes that the Association and the arbitrator may suffer
"liability" if the arbitration proceeds. In his March 22d letter to Ms. Marshall, for
example, Mr. Hallman wrote in part that "the AAA and the Arbitrator potentially
subject themselves to liability by moving forward with an arbitration that is not
authorized under the 2003 Agreement." Letter, at 6 (citing no authority). To the
contrary, the tribunal has confirmed its own jurisdiction under the Skywalk
Agreement (§15.4) and the governing rules of the American Arbitration Association.
Since that order, the only other development - the condemnation proceedings in
Tribal Court - would appear not to have affected the cause of action brought here
for resolution.
In fact, during argument on February 24th, Judge Campbell expressed the
same reservations about the position taken by SNW and the Tribe that this tribunal
has expressed. See Reporter's Transcript of Proceedings - Temporary Restraining
Order Hearing (2.24.12), at 73-75 ("I'm having great difficulty with the idea that
this cause of action is not a separate asset owned by the corporation, that it is really
just part and parcel of their rights under the contract that can be seized by the
tribe."). Counsel for SNW may confuse contracts (and the rights under those
contracts) with choses in action, but that issue appears not to have been briefed for
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 16 of 23
Judge Campbell (not to mention the subsidiary issues, including whether exercise
over a chose in action - as opposed to an interest in an agreement - mayor could
constitute a public use). In any event, despite those misgivings, and even though his
order did not enjoin this arbitration, the effect of the March 19th order from Judge
Campbell should be to postpone the final hearing. The parties would otherwise
undertake the (lengthy) final arbitration hearing without having the opportunity to
test in some forum the effect of the condemnation ordinance and declaration of
taking on the ownership of the claims at issue.
For that reason, the final hearing is hereby postponed. The tribunal vacates
the current hearing (set for April 2-13, 2012) and re-sets the final hearing to July
16-20 and July 23-27, 2012, unless otherwise ordered by this tribunal, agreed by
the parties, or ordered by the Hualapai Tribal Court or U.S. District Court. The
parties should appear and present their proofs. Unless before the hearing date
either SNW or the Tribe obtains an order to the contrary from the Tribal Court or
the U.S. District Court, the arbitration will proceed to final hearing and thereafter
to final award.
Our case manager should arrange for our next preliminary hearing (via
telephone) on May 14, 2012 at 11:00 a.m. (ArizonaIMST). During that hearing,
counsel should report on the status of the cases in the Hualapai Tribal Court and
U.S. District Court. In the meantime, in the absence of an order to the contrary
from either Judge Campbell or the Tribal Court, the parties shall proceed with
preparations for the final hearing, including the production of documents and
testimony from third parties.
Dated: March 27, 2012Phoenix, Arizona
/ s/ Shawn K. AikenShawn K. Aiken, Arbitrator
S:\AAA-SKA\Current\29914001 Grand Canyon v. 'Sa' Nyu Wa\Pleadings\SuppOrdReFedCtOr~fg~f)Hfgned by Shawn
Shawn AikenDN: cn=Shawn Aiken,o=Aiken Schenk et aI., OU,[email protected]=USDate: 2012.03.2714:52:33-OTOO'
Aiken
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 17 of 23
4
ORD·.R - :
Case 3:12-cv-08030-DGC Document 61-1 Filed 09/10/12 ~~;:~'-j-~~~~==:;~::~:D=D~IN THE HUALAPAI TRIBAL COUR
HUALAPAI RESERVATION, ARIZO.~A:.:!.-~~~1--~
7
THE HUALAPAI INDIAN TRIBE OF THE )HUALAPAI INDIAN RESERVATION, )Arizona, )
)))))))))))
11----------------------------)
MINUTE ENTRY AND ORDER
Case No.: 2012-CV-017
6Plaintiff,
vs.8
GRAND CANYON SKYWALKDEVELOPMENT, LLC, a Nevada limitedliability company,
9
10Defendant.
11
12
13This matter is before the Court on Plaintiff's Motions for to Enlarge the Court's
Temporary Restraining Order to Enjoin Arbitration Proceedings. Defendant filed an
Opposition, to which Plaintiff replied. The Court heard oral argument from the parties.
Defendant is represented by counsel for the limited purpose of arguing jurisdiction.15
16I. BACKGROUND
18A Development and Management Agreement was entered into in December
2003 between 'SA' NYU WA, a Hualapai Indian Tribe chartered corporation, and:.9
20GRAND CANYON SKYWALK DEVELOPMENT, LLC, a Nevada limited liability
21company. This agreement was for the development and operation of the skywalk.
Grand Canyon Skywalk Development, LLC filed a complaint in this Court arguing
breach of contract and seeking an order to compel arbitration pursuant to the
agreement. Grand Canyon Skywalk Development commenced the arbitration process in
that matter.
2?
23
2!.
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 19 of 23
1
2
3
4
5
6
7
8
9
10
11
12
13
14
IS
16
17
Case 3:12-cv-08030-DGC Document 61-1 Filed 09/10/12 Page 18 of 29
The Hualapai Indian Tribe issued a declaration of takings concerning the
Skywalk in February 2012. They also sought a temporary restraining order to prevent
GCSD, its officers, agents, employees from destroying of damaging any property
located at the Grand Canyon Skywalk and which is the subject of GCSD's contractual
interest in that certain Development and Management Agreement, dated as of
December 31.2003, as amended. and from taking, removing. or absconding with such
property from the Hualapai Reservation. The Court granted the TRO.
18 STANDARD FOR PRELIMINARY INJUNCTION AND A TEMPORARY RESTRAINING
19 ORDER
20 In the federal courts, temporary restraining orders are governed by Rule 65(b) of
21 the Federal Rules of Civil Procedure. Rule 65 of the Federal Rules of Civil Procedure
22 explains what injunctions are and the rules regarding them. Basically, there are two
23 types of injunctions: a preliminary injunction and a temporary restraining order (TRO).
24 The purpose of both is to maintain the status quo - to insure a plaintiff that the
25 defendant will not either make him or herself judgment-proof, or insolvent in some way.
II. DISCUSSION
TRIBAL RULES OF CIVIL PROCEDURE
The Court finds that jurisdiction is proper in this matter.
Section 3.1 (D) of the Hualapai Law and Order Code provides that "[a]s to any
matters that are not covered by the Tribal Constitution, codes, ordinances or resolutions
of the Tribe or by Tribal Common Law or by applicable federal law or regulation, the
Tribal Court may be guided by common law as developed by other Tribal, federal or
state courts."
ORDER - 2
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 20 of 23
1
2
3
ORDER - 3
Case 3:12-cv-08030-DGC Document 61-1 Filed 09/10/12 Page 19 of 29
or to stop him or her from acting in the harmful, complained-of way until further judicial
proceedings are available.
4 CONTRACT ISSUES
Sovereign Immunity
"Indian tribes are unique aggregations possessing attributes of sovereignty over
both their members and their territory ... ; they are 'a separate people' possessing 'the
power of regulating their internal and social relations ....'" United States v. Mazurie, 419
U.S. 544, 557, 95 S.Ct. 710, 717,42 L.Ed.2d 706,716-17 (1975) (citations omitted).
SUb-delegation of administrative authority to a sovereign entity is not per se improper.
Id.; see United States v. Matherson, 367 F.Supp. 779, 781-83 (E.D.N.Y.1973)
(upholding regulation issued by Superintendent of Fire Island National Seashore
requiring persons seeking to operate motor vehicles on certain national seashore lands
to secure first a permit from the local municipality), affd mem., 493 F.2d 1399 (2d
Cir.1974). Nor must such a sub-delegation rest on express statutory authority. See
Fleming v. Mohawk Wrecking & Lumber Co., 331 U.S. 111,120-22,67 S.Ct. 1129,
1134,91 L.Ed. 1375 (1947); Tabor v. Joint Bd. for Enrollment of Actuaries, 566 F.2d
705,708 n. 5 (O.C.Cir.1977).
Suits against Indian Tribes are barred by Tribal sovereign immunity unless
sovereignty is waived by Congress or the Tribe. Kiowa Tribe v Manufacturing
Technologies, Inc., 523 U.S. 751, 754 (1998); Oklahoma Tax Comm'n v. Citizen Band
of Potawatomi Indian Tribe, 498 U.S. 505, 509 (1991). Immunity from suit extends to
tribal contracts involving commercial or governmental activities and for contracts made
both on and off a reservation. Kiowa Tribe, 523 U.S. at 760.
5
6
7
B
9
10
11
12
13
14
15
16
17
IB
19
20
21
22
23
24
25
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 21 of 23
1
2
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
ORDEH - 4
Case 3:12-cv-08030-DGC Document 61-1 Filed 09/10/12 Page 20 of 29
19
20
21
22
23
24
25
The United States Supreme Court has repeatedly stated that any waiver of a
tribe's immunity must be unequivocally expressed and cannot be implied. "It is settled
that a waiver of sovereign immunity 'cannot be implied but must be unequivocally
expressed ....Santa Clara Pueblo v. Martinez, 436 U.S. 49, 58-59 (1978) (citing United
States v. Testan, 424 U.S. 392, 399 (1976) which quotes United States v. King, 395
U.S. 1,4 (1969).
In the instant matter, the 2003 Agreement in Article 15, Section 15.4 (d) Limited
Waiver of Sovereign Immunity, provides that SNW, a Hualapai Indian Tribe corporation,
expressly waives its sovereign immunity with respect to all disputes arising out of the
Agreement to the extent permitted un the Constitution of the Nation.
The Tribal Constitution provides that the Tribal Council may expressly waive the
Tribe's sovereign immunity. The Constitution also requires that express waivers of
sovereign immunity require the approval of at least thirty (30) percent of the total
number of eligible voters of the Tribe voting in a special election if the waiver may
expose the Tribe to liability in excess of $250,000 dollars, or its equivalent.
Given that the Tribal Council authorized 'SA' NYU WA to enter into the
agreement with GCSD with the provisions concerning sovereign immunity, the Court
finds that the Council expressly waived sovereign immunity for the sole purpose of the
2003 agreement.
Breach of Contract
The 2003 Agreement also provided in Article 15, Section 15.4 (a) that "any
controversy, claim or dispute arising out of or related to the 2003 Agreement shall be
resolved through binding arbitration. The governing law for disputes was agreed to be
the State of Arizona laws and the Hualapai Indian Tribal Law. Also, any laws of the
State of Arizona that may be interpreted to (1) waive SNW's or the Nation's sovereign
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 22 of 23
1 immunity; (2) require arbitration other than as agreed in Section 15.4(a); or (3) require
SNW or the Nation to appear in any court or other proceeding in the State of Arizona,
except federal courts are exclude. The venue and jurisdiction for any litigation under the
Agreement was agreed to be the federal courts sitting in the State of Arizona and
located in or around Peach Springs, Arizona.
Isl Lawrence C. Kin
Case 3:12-cv-08030-DGC Document 61-1 Filed 09/10/12 Page 21 of 29
2
3
4
5
6
7 III. ORDERS
8 IT IS ORDERED that the TRO remain as it relates to the to prevent GCSD, its
9 officers, agents, employees from destroying of damaging any property located at the
10 Grand Canyon Skywalk and which is the subject of GCSD's contractual interest in that
11 certain Development and Management Agreement, dated as of December 31, 2003, as
12 amended, and from taking, removing, or absconding with such property from the
13 Hualapai Reservation.
14 IT IS ORDERED that SNW and GCSD may proceed with the Arbitration as
15 agreed to in the Development and Management Agreement, dated as of December 31,
16 2003, as amended.
17 SO ORDERED this 15th day of July 2012.
18
19
20Honorable Lawrence KingJudge, Hualapai Indian Tribe
21
22
23
24
25
ORDER - :;
Case 3:12-cv-08030-DGC Document 64-1 Filed 10/04/12 Page 23 of 23