Menominee Indian Tribe of Wisconsin v. United States of America, et al.

Issues 

Whether the D.C. Circuit misapplied Holland’s decision when it ruled that the statute of limitations was not subject to equitable tolling for claims brought under the Indian Self Determination and Education Assistance Act (“ISDA”)? .

Oral argument: 
December 1, 2015

The U.S. Supreme Court will decide whether the D.C. Circuit misapplied the Court’s decision in Holland v. Florida when the D.C. Circuit ruled that the statute of limitations was not subject to equitable tolling for the Menominee Indian Tribe of Wisconsin’s (“the Tribe”) 1996–1998 claims for contract support costs. The Tribe argues that despite the D.C. Circuit’s interpretation of the Holland standard for equitable tolling as rigid and mechanical, the Holland standard should instead conform to the Federal Circuit standard, which is a comprehensive and unified analysis that also follows the proper interpretation of Holland. . In contrast, the United States argues that the elements within a comprehensive analysis do not provide an independent basis for equitable tolling, and that equitable tolling should not excuse the Tribe’s miscalculations and legal misunderstandings.

Questions as Framed for the Court by the Parties 

Petitioner: Whether the D.C. Circuit misapplied this Court’s Holland decision when it ruled that the Tribe was not entitled to equitable tolling of the statute of limitations for filing of ISDA claims under the CDA? .

Respondent: Whether the court of appeals misapplied this Court’s decision in Holland v. Florida, when it ruled that petitioner was not entitled to equitable tolling of the statute of limitations for filing of ISDA claims under the CDA? .

Facts 

Between 1995 and 2004, the Tribe provided healthcare services to its members pursuant to a self-determination contract with the Secretary of Health and Human Services (“HHS”). . This contract transferred direct control and operation of “certain federal Indian programs” to the Tribe, at their request, from the Secretary of HHS.It also included the federal government’s agreement to pay for those programs, which took into account base and attendant costs of transferring, implementing, and running the programs. . Disputes related to self-determination contracts fell under the scope of the Contract Disputes Act (“CDA”) and the ISDA.

Furthermore, issues between tribes and the United States occurred nationwide because U.S. federal agencies were not paying for the full support costs pursuant to the self-determination contracts. The ISDA required every self-determination contract to contain a provision making the full payment of contract support costs “subject to the availability of appropriations.” Federal agencies like the Department of the Interior and HHS believed that this provision authorized them to pay less than the full amount even when Congress allocated sufficient funds to pay the full amount.

In response, some other tribes attempted to pursue individual lawsuits, but the Tribe decided a lawsuit would be futile. The Tribe, however, relied upon two class-action lawsuits for partial relief despite being a class member for only the first suit. The first class-action lawsuit gave some relief to the Tribe, providing $800,000 in compensation for Bureau of Indian Affairs [BIA] underpayments and equitable relief for future payments of the support costs pursuant in BIA contracts. However, the second lawsuit, which was related to payment issues with the HHS, was unsuccessful in receiving class certification, which disabled the suit from evolving into a class-action lawsuit. That lawsuit, however, was eventually successful in the U.S. Supreme Court. Because of this success, the Tribe brought an administrative claim with a contracting officer at the Indian Health Services (“IHS”), which is part of the HHS, pursuant to CDA requirements over self-determination contract disputes. Notwithstanding the fact that the Tribe sought compensation from 1995 to 2004, the contracting officer denied the claims that ran from 1996 to 1998 because these claims were two years past the six-year statute of limitations pursuant to the CDA.

The Tribe then filed a claim in federal district court, arguing that the statute of limitations should not have accounted for the last two years because the Tribe’s claim was tied to the class-action lawsuits under the doctrine of class-action tolling. The Tribe also argued that its claims were eligible for equitable tolling. The district court ruled in favor of the contracting officer and rejected the Tribe’s argument for class-action and equitable tolling. The Court of Appeal for the DC Circuit affirmed the lower court’s denial of the Tribe’s class-action tolling, but remanded to the district court with further guidance on how to determine if the statute of limitations was subject to equitable tolling. However, after remand, the district court found that the Tribe’s “failure to timely file its claims was not one of the ‘extraordinary and carefully circumscribed instances’” for which equitable tolling would be appropriate as set forth in Holland v. Florida. The Court of Appeals affirmed, stating that the “extraordinary circumstances” required by the Holland case for the allowance of equitable tolling were absent. . The Tribe then appealed to the U.S. Supreme Court.

Analysis 

In this case, the Court will decide whether a plaintiff filing an ISDA claim under the CDA warrants equitable tolling of the statute of limitations based on the two-pronged test outlined in Holland v. Florida. In Holland, the Court determined that equitable tolling was available when claimants: (1) demonstrated proper diligence in pursuing their rights, and (2) had some “extraordinary circumstance” preventing them from filing a claim in a timely manner. The Tribe contends that the Holland test is satisfied by a claimant who relied in good faith on the belief he or she benefitted from tolling of the statute of limitations due to other pending litigation, and as a result, passed on opportunities to bring his or her own claim via administrative presentment. Moreover, the Tribe asserts that the Holland test should be applied holistically in the spirit of equity and consider the entirety of the claimant’s situation in order to avoid what the Court decried in Holland as a “rigid per se approach” to equitable tolling. On the other hand, the United States asserts that a “miscalculation” in litigation strategy to not seek class action certification cannot be a basis for satisfying the Holland test, noting that the test’s extraordinary circumstance prong requires a much more significant obstacle or impediment to timely litigation.

SATISFYING THE DILIGENCE PRONG OF THE HOLLAND TEST

The Tribe rejects this wholesale focus on the Holland test’s extraordinary circumstance prong as a disservice to the principles of equity, arguing that the diligence prong must be considered alongside any extraordinary circumstances to reflect the totality of the claimant’s particular situation. Pointing to the jurisprudence that led to the Court’s decision in Holland, the Tribe cites Irwin v. Dep’t of Veteran Affairs, in which the Court accepted that extraordinary circumstances were required for equitable tolling only when a claimant was diligently pursuing his or her rights in the meantime, to illustrate that the two prongs are inexorably intertwined. With respect to the diligence aspect, the Tribe maintains that reliance on the Cherokee Nation series of cases, ending with Cherokee Nation of Okla. v. Leavitt, before filing a CDA claim could be construed as proper diligence because the reliance was in good faith on what amounted to be a defective pleading. Although the plaintiffs in Cherokee Nation were ultimately unsuccessful, the Tribe nevertheless asserts that monitoring the contemporaneous litigation before committing to a separate claim—fearing adverse or conflicting legal precedent if they filed a claim at an imprudent time—constitutes proper diligence for the purposes of equitable tolling.

Although the United States asserts that a failure to prove the extraordinary circumstances prong would be fatal to the Tribe’s case in and of itself, the United States also claims that merely monitoring the preexisting litigation cannot be considered adequate diligence. As the claim procedures necessary to avoid the statute of limitations could have been met easily, the United States purports that a failure to do so, regardless of the contemporary legal climate, is damning to any notion of proper diligence. Indeed, the United States compares the Tribe, which waited two years after the expiration of the statute of limitations in full knowledge of that fact to file its claim, unfavorably in this respect to the plaintiff in Holland, who filed his own pro se petition the same day he discovered his attorney’s failings. As a result, the United States avers that under historical equity practices, allowing equitable tolling despite laches would be highly inappropriate. Finally, the United States points to the Court’s prior jurisprudence to show examples of the two prongs being considered as separate and discrete requirements for equitable tolling, although the United States contends that the Tribe fails both prongs however they are considered.

DEFINING THE HOLLAND TEST’S “EXTRAORDINARY CIRCUMSTANCES” PRONG

The Tribe asserts that its limited resources to pursue all avenues of litigation and the unique legal climate surrounding ISDA litigation satisfied the extraordinary circumstance test. With respect to the legal climate at the time, the Tribe argues that its only guidance prior to Cherokee Nation regarding class certification was Ramah Navajo Chapter v. Lujan, in which the Tenth Circuit approved certification for class members undertaking contract support litigation despite not having met the CDA presentment requirements. As a result, the Tribe contends that it was right to believe that presentment was not required for certification in the class for Cherokee Nation, only being disabused of this notion by Pueblo of Zuni v. United States, in which the district court denied class certification for tribal contractors bringing contract support claims. To explain why it did not seek presentment regardless of pending litigation, the Tribe points to its limited financial resources, painting its decision to not pursue litigation as calculated since other tribes were litigating the same issues in several federal courts; and, while presentment was in theory simple, it would have incurred significant costs. The Tribe also posits that its decision made good legal sense from a strategic perspective: assuming that the Tribe’s reliance on Cherokee Nation was correct, filing a presentment claim would have subjected the Tribe to an even shorter statute of limitations.

The United States dismisses the Tribe’s reasoning for its actions, contending that the “miscalculation” of relying on Cherokee Nation was not an extraordinary circumstance but rather a self-inflicted injury. To illustrate this, the United States argues that the Tribe could not infer that it was a member of the putative class in Cherokee Nation without actually presenting its own claim, the mere fact that other tribes were litigating the same issue not absolving the Tribe of this requirement. Moreover, the United States cites a broad spectrum of prior jurisprudence supporting its premise that when presentment is a requirement of a suit, those who do not undergo presentment cannot be counted as a claimant in the action. The United States also attacks the Tribe’s decision to simply monitor the flow of litigation, claiming that waiting four years to file suit after Cherokee Nation’s class certification was denied could hardly be considered equitable for the purposes of tolling. Building on this, the United States avers that the Tribe’s reliance on Ramah, an “unpublished, interlocutory district court decision,” was done at its own peril, and the sparseness of the legal guidance on the matter should have led the Tribe to be forthright with its claims instead of reserved.Lastly, the United States rejects the Tribe’s claims of financial difficulties by pointing to the Equal Access to Justice Act as a means by which the Tribe could have recouped the administrative costs of presentment.

LOOKING TO OTHER RELEVANT FACTORS FOR DETERMINING EQUITABLE TOLLING

Working from its prior claim of the Holland test as holistic, the Tribe argues that other equitable factors, even those that cannot be independent bases for equitable tolling, should be considered relevant in the tolling analysis. The first factor the Tribe points to is the lack of prejudice to the federal government if tolling is permitted. The Tribe contends that since the government has been on notice of the Tribe’s claim since 1999 and the beginning of the Cherokee Nation series of cases, no prejudice exists. Furthermore, the Tribe notes that as its case is based solely on documentary evidence such as contracts, funding agreements, and so forth instead of witnesses, the passage of time does not prejudice the government’s defense. The Tribe maintains that the second factor is “some peculiar confidential or fiduciary relation between the parties” that has historically been a part of equitable analysis, and the federal-tribal relationship is one involving unique obligations that should be considered relevant with respect to tolling.

The United States contends that each of the additional equitable factors the Tribe posits as relevant are without merit. The United States argues that prejudice can only be considered in an equitable analysis after identifying an extraordinary circumstance that could trigger tolling. This notwithstanding, the United States claims that there would be prejudice from tolling because there was no presentment to indicate that the Tribe was part of the Cherokee Nation putative class, rendering void any notion that the government was put on notice as to the Tribe’s claims. As for the federal-tribal relationship, the United States acknowledges that the ISDA points to the “unique and continuing relationship” between the federal government and the various Native American tribes. However, the United States asserts that there is nothing in the statute that confers additional rights upon the Tribe as a result, and points to prior jurisprudence in which statutes of limitations are applied to the Indian tribes in the same manner as any other litigant.

Discussion 

The U.S. Supreme Court will decide whether the D.C. Circuit Court and Court of Appeal correctly interpreted the Holland test when it ruled that the statute of limitations was not subject to equitable tolling for the Tribe’s 1996-1998 claims. I. The Tribe contends that the trial court misinterpreted the Holland test to be rigid and mechanical when it should be a holistic, comprehensive and case-by-case analysis instead, advocating for increased emphasis of the unique federal-tribal relationship when conducting equitable tolling analyses involving tribes. . In contrast, the United States argues that all elements of the Holland test must be individually satisfied, and that lack of prejudice and the unique federal-tribal relationship do not independently warrant equitable tolling.

BASES FOR EQUITABLE TOLLING

The Tribe argues that all relevant factors, including the lack of prejudice to the government resulting from the delay and the unique federal-tribal relationship, should be considered collectively during the equitable tolling analysis, because equity inherently involves a case-by-case analysis by the Court. . The Tribe emphasizes that the Court’s analysis in Holland focused on the two factors of diligence and extraordinary circumstances not as completely separate from each other, but that “its analysis of them was unitary and holistic, focusing on diligence in light of the circumstances.”. Additionally, the National Congress of American Indians (“NCAI”), in support of the Tribe, argues in favor of a comprehensive case-by-case analysis for equitable tolling because Supreme Court precedent supports the use of a case-by-case analysis to take into consideration the unique historical trust relationship between the federal government and the Indian tribes as part of the equity analysis.

The United States argues that neither the lack of prejudice toward the government resulting from the Tribe’s delay in filing suit nor the unique relationship between the federal government and tribes independently constitute a basis for equitable tolling. . The United States further contends that it was prejudiced by the delay, contrary to the Tribe’s contentions, and that despite the unique relationship between the federal government and tribes, the Court has held that tribes should be treated the same as other litigants in this context. Additionally, the United States argues that the Tribe’s arguments completely neglect to address the United State’s interest in repose, which the statute of limitations is designed to protect.

THE UNIQUE FEDERAL-TRIBAL RELATIONSHIP

The NCAI, in support of the Tribe, argues that the Court should place greater weight on the unique and historical relationship between the federal government and the tribes. This unique relationship, the NCAI argues, was part of the basis for the ISDA, informed the creation of additional contract protections for tribes contracting with the federal government, and should carry greater weight in equitable tolling analyses. According to the NCAI, the unique relationship is a significant, albeit not dispositive, part of the analysis for equitable tolling because it supports Congress’ intent behind the enactment of the ISDA and the purpose of self-determination contracts to facilitate economic development for Indian tribes. . The NCAI argues that consideration of the federal-tribal relationship will advance the policies underlying that relationship, and that courts should grant this relationship at least the same consideration in equity analysis that courts have granted the special relationships between the federal government and veterans or Social Security beneficiaries. . Additionally, the Tribe argues that if the Court decides against the Tribe, it would undermine efforts promoted by the federal government, Congress (through enacting the ISDA), and the tribes to increase tribal self-determination because federal funding for indirect costs related to self-determination contracts is essential to tribes’ capacity to engage in self-determination. .

The United States argues that the unique relationship between the federal government and Indian tribes should not be considered within the analysis for equitable tolling because claims involving the statute of limitations brought by Indian tribes should be treated like claims brought by any other claimant. . In addition, the United States asserts that affirming the decision below would give “the government the central benefit of repose,” and that such decision was justified because the government was without notice of the Tribe’s individual claims and because the Tribe waived its claims. . The United States then asserts that repose for the government would help in the management and administration of programs that are bound by budget cycles and conclusions to annual contract terms, like the IHS. In addition, extending equitable tolling to the Tribe, according to the United States, would promote “abuse[] by encouraging lawyers []to frame their pleadings” to save their clients who have waived their rights.. In other words, the United States asserts that reversing the decision below would allow a litigant to use existing lawsuits as an excuse for untimeliness. . Furthermore, because those prior lawsuits would bear tolling effects, a litigant would be able to delay indefinitely until the prior lawsuit resolves.

Conclusion 

his case will clarify the situations in which ISDA claimants suing under the CDA can assert equitable tolling of the statute of limitations under the Holland test. The Tribe contends that good faith reliance on class action tolling of the statute and not possessing the financial means to undergo a presentment claim for class certification are together sufficient grounds for equitable tolling under Holland. Conversely, the United States avers that the Tribe’s reliance on being part of Cherokee Nation’s putative class was unwarranted due to a lack of a presentment claim, something that the Tribe failed to exercise adequate diligence toward achieving despite methods of alleviating the financial costs. The Court’s ruling will impact the number and scope of ISDA claims under the CDA, and could change how Native American tribes approach obtaining their ISDA contract support costs.

Edited by 

Acknowledgments 

Additional Resources