Move to tribal court affirmed

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It is not necessary that there be a separate pending case in tribal court for a state court to transfer an action under sec. 801.54(2).

In the first appellate case to interpret the statute, the Wisconsin Court of Appeals concluded on June 1 that “concurrent jurisdiction” only means that both courts could exercise jurisdiction over a dispute, not that both currently are.

John Kroner was employed by Oneida Seven Generations Corp. as its chief executive officer. The sole shareholder of Seven Generations is the Oneida Tribe.

Kroner, who is not a member of the tribe, brought suit in Brown County Circuit Court for breach of contract after his employment was terminated in 2008.

In response to a request from the judge, counsel for Seven Nations asked the Oneida courts if they would be willing to accept jurisdiction over the case, and the tribal court replied that it would.

No action was taken however, until 14 months later, when Seven Generations moved to transfer the case. The court granted the motion, and Kroner appealed.

In an opinion by Judge Michael Hoover, not recommended for publication, the Court of Appeals affirmed.

Kroner argued that the tribal court lacked personal jurisdiction over him, because there was no separate action pending in tribal court; thus, there could be no “concurrent jurisdiction,” as required by the statute.

But the court disagreed, explaining, “The transfer statute does not require, much less mention, concurrent pending actions. The situation contemplated by the transfer statute is akin to cases where state actions might be removed to federal court — without any requirement that cases be pending in both jurisdictions.”

Turning to the discretionary factors enumerated in the statute, the court held it was not an erroneous exercise of discretion to transfer the case.

The court acknowledged that the circuit court did not address all the enumerated factors, but said it was satisfied they were considered and that the circuit court properly exercised its discretion.

The circuit court placed its emphasis on factor (a), “Whether issues in the action require interpretation of the tribe’s laws…,” because interpretation of the employment contract would require interpretation of the tribe’s employee manual.

The Court of Appeals agreed that this factor supported transfer.

It also concluded that several other factors supported transfer, even if the circuit court did not address them specifically.

Subsection (c) asks whether the tribe is a party, which it is; and subsec. (d) inquires into the tribal membership of the parties. Although Kroner is not a member, the court found that, because he chose to become employed by a wholly owned corporation of the tribe, this factor supports transfer.

Finally, the court addressed factor (j): “The relative burdens on the parties, including cost, access to and admissibility of evidence, and matters of process, practice, and procedure, including where the action will be heard and decided most promptly.”

Kroner argued it would be inequitable for him to have to begin litigation anew in a different forum after almost two years of litigation, but the court disagreed, finding that discovery need not be done over, and that the tribal court is located in the same county as the circuit court.

Before concluding, though, the court cautioned, “When determining whether to transfer a case to tribal court under Wis. Stat. sec. 801.54(2), the better practice is for a circuit court to individually address each of the statutory factors. This will minimize the potential for error, reduce appeals, and ease appellate review. Nonetheless, having considered the record and the statutory factors, we are satisfied the circuit court properly exercised its discretion in this case.”

Attorney John Swimmer, who was chair of the State Bar’s Indian Law Section when the discretionary transfer law was passed, said he was surprised by several aspects of the court’s opinion: First, that the court did not recommend it for publication, when it is, in his view, “a huge opinion.” Second, that the dispute did not have a strong nexus to the reservation or tribal lands. Third, that there was no concurrent case pending in tribal court over the same matter. And fourth, that the transfer was initiated by the circuit court.

Swimmer said, “This is the first time I’ve seen an employment dispute transferred. I don’t think anything in the opinion said the employee agreed to be bound by tribal law. … I’d always thought courts would be reluctant to [transfer employment cases] with non-tribal employees. I thought it would be harder to make that link.”

“It really opens the door to tribes moving cases to tribal court for employment disputes, and then raising sovereign immunity as a defense,” Swimmer opined.

Swimmer added that he was curious to see if the case would be followed when the employee is a non-tribal member in a large city, noting that a dispute involving an employee at the Milwaukee-based Potawatomi casino would be transferred all the way to Crandon, if transfer were to occur.

Swimmer said it was also the first time he had heard of the judge initiating transfer rather than the tribe.

What the Court Held

Case: Kroner v. Oneida Seven Generations Corp., No. 2010AP2533

Issue: Was it an abuse of discretion for a circuit court to transfer an employment dispute to tribal court?

Holding: No. Where the tribe was the employer, it was a proper exercise of discretion to transfer the case.

Attorneys: For Plaintiff: Michael Brown, Appleton; For Defendant: Thomas Schober, Green Bay

David Ziemer can be reached at [email protected].