Oklahoma Tax Comm’n v. Graham, 489 U.S. 838 (1989)

Oklahoma Tax Commission v. Graham


No. 88-266


Argued February 21, 1989
Decided March 29, 1989
489 U.S. 838

CERTIORARI TO THE UNITED STATES COURT OF APPEALS FOR
THE TENTH CIRCUIT

Syllabus

Respondent Chickasaw Nation owns and operates a motor inn in Oklahoma at which it conducts bingo games and sells cigarettes. After the State filed a state court suit against the Tribe and respondent inn manager to collect unpaid state taxes on these activities, the Tribe, asserting federal question jurisdiction, removed the action to the Federal District Court. The State’s motion to remand the case on the ground that the complaint alleged only state statutory violations and state tax liabilities was denied by the District Court, which held that the complaint implicated the federal question of tribal immunity, since it sought to apply state law to an Indian Tribe. Thereafter, the court dismissed the suit, finding it barred by tribal sovereign immunity. The Court of Appeals affirmed, noting that, as a prerequisite to stating jurisdiction over an Indian tribe, an alleged waiver or consent to suit is a necessary element of a well-pleaded complaint. The court adhered to that disposition on remand from this Court, finding that the rule of Caterpillar Inc. v. Williams, 482 U.S. 386 -- that to support federal court removability, a complaint on its face must present a federal question -- did not apply to the State’s complaint. The court found that, although nothing within the complaint’s literal language suggested the implication of a federal question, such a question was inherent within the complaint because of the parties subject to the action.

Held: This case was improperly removed from the Oklahoma courts. The Court of Appeals’ decision is plainly inconsistent with Caterpillar. The possible existence of a federal tribal immunity defense to the State’s claims did not convert a suit otherwise arising under state law into one which, in the statutory sense, arises under federal law. And there was no independent basis for original federal jurisdiction to support removal. This jurisdictional question is not affected by the fact that tribal immunity is governed by federal law, since Congress has expressly provided by statute for removal when it desired federal courts to adjudicate defenses based on federal immunities.

846 F.2d 1258, reversed.