Tribe Immune from Employee Suit

A California Indian tribe that operates a casino is protected by sovereign immunity from breach of contract actions by casino employees, according to a new decision by the California Court of Appeals.

In the case, various employees had signed contracts with the tribe which contained provisions for severance pay and arbitration clauses.  After they were fired without cause and without severance, they sued in state court.  The tribe demurred.  It claimed sovereign immunity from suit.  The employees argued that the arbitration clauses waived sovereign immunity.  The court disagreed:

“[T]o relinquish its immunity, a tribe’s waiver must be ‘clear.’”  Waivers are “strictly construed,” and there is a “strong presumption” against them. “Because a waiver of immunity is altogether voluntary on the part of [a tribe], it follows that [a tribe] may prescribe the terms and conditions on which it consents to be sued, and the manner in which the suit shall be conducted.”   [Citations omitted.]

Here, the reference to arbitration could not be read as agreement to be sued in state court, and the complaint should have been dismissed.

Big Valley Band of Pomo Indians v. Superior Court, 2005 Cal. App. LEXIS 1700 (1st Dist. Nov. 1, 2005).

[Frank Snyder]