Conducting Business with Tribes in the Aftermath of the Dollar General Supreme Court Split: What You and Your Clients Need to Know

Introduction
With the U.S. Supreme Court’s 4–4 split in Dollar Gen. Corp. v. Mississippi Band of Choctaw Indians, 136 S. Ct. 2159 (2016), tribal members and nonmember individuals and businesses are left to wonder who really wins in this tie. The split decision provided no written opinion and operates as an affirmation of the Fifth Circuit’s decision upholding the jurisdiction of the Mississippi Band of Choctaw tribal court over tort claims brought by a member of the Choctaw tribe against a corporation doing business on reservation land. This decision serves as a significant reminder that anyone doing business on tribal lands must be cognizant that tribal court jurisdiction likely may apply over any disputes that arise.
Overview of Tribal Jurisdiction
Over 30 years ago, the U.S. Supreme Court created two exceptions to the general rule that Indian tribes cannot exercise civil jurisdiction over nonmembers in Montana v. United States, 450 U.S. 544, 565–66 (1981). The first of the two Montana exceptions, also known as the “consensual relationship” exception, establishes that a tribe may regulate the activities of nonmembers entering consensual relationships with the tribe or members thereof through “commercial dealing, contracts, leases, or other arrangements.” Methods of such regulation include “taxation, licensing, or other means.”
Despite this evident pronouncement that tribal courts may, under certain circumstances, exercise jurisdiction over nonmembers, approximately 20 years after the Montana decision, the Supreme Court itself recognized that tribal courts had yet to exercise jurisdiction over a nonmember defendant in any context whatsoever, leaving many to question for two decades whether, and under what circumstances, nonmembers may be subject to tribal court jurisdiction. See generally Nevada v. Hicks, 533 U.S. 353 (2001) (finding Montana’s proscriptions to fall short of dispositive in the case “when weighed against the State’s interest in pursuing off-reservation violations of its laws.”).
Dollar General’s Procedural Posture
The factual background of Dollar General sounds in tort. Dolgencorp operates a Dollar General store on the Choctaw reservation in Mississippi, located on land held by the United States in trust on behalf of the Mississippi Band of Choctaw Indians (the Tribe). The Dollar General store is operated pursuant to a lease agreement with the Tribe and a business license issued by the Tribe to Dolgencorp. Dolgencorp, Inc. v. Mississippi Band of Choctaw Indians, 746 F.3d 167, 169 (5th Cir. 2014). The Tribe conducts the Youth Opportunity Program (YOP), a project which places young members of the Tribe in short-term, unpaid positions—similar to internships—for educational and training purposes. The manager of the Dollar General store, Dale Townsend (Townsend), agreed to participate in this program. Townsend was not a member of the Tribe. Thereafter, the YOP program placed a 13-year-old tribal member (Doe) at the store. Doe later accused Townsend of sexual molestation.
In January 2005, Doe filed suit against Townsend and Dolgencorp in the Choctaw tribal court, alleging that Dolgencorp was vicariously liable for Townsend’s actions and asserting the store negligently hired, trained, or supervised Townsend. Doe further claimed the assault caused severe mental trauma, seeking “actual and punitive damages in a sum not less than 2.5 million dollars.”
Townsend and Dolgencorp filed motions in tribal court seeking to