Tribal Court Has Subject Matter Jurisdiction over Insurers

    The Ninth Circuit affirmed the panel's decision not to rehear en banc a case which affirmed the district court's summary judgment in favor of a tribe and against several insurance companies and underwriters. Lexington Ins. Co., et al. v Smith, et al., 2024 U.S. App. LEXIS 23429 (9th Cir Sept. 16, 2024). 

    The Suquamish Tribe sued several insurance companies in tribal court for breach of contract concerning claims for lost business and tax revenue and other expenses arising from the suspension of business operations during the COVID-19 pandemic. The Suquamish Tribal Court determined that it had subject matter jurisdiction, a decision that was upheld by the district court. The insurers appealed, and a panel of the Ninth Circuit affirmed. The panel also denied the insurers' petition for rehearing en banc.

        The en banc decision found that tribal jurisdiction was appropriate under Supreme Court precedent. The tailored tribal insurance policy from insurance companies offering specialised tribal coverage for tribal property, and the transactions surrounding the policies, had "tribal" written all over them.  Tribal First was an entity set up to offer insurance for tribes. Lexington Insurance Company and several other insurance companies contracted with Tribal First to offer policies to tribal governments and enterprises. The insurers then issued policies that were to be provided through Tribal First to tribes.

    The insurers contracted with the Suquamish Tribe over a series of years to provide coverage for properties and businesses on tribal trust lands, including almost $242 million worth of real property, and then denied claims arising from losses on the reservation. The panel applied Supreme Court and circuit precedent in holding that the insurers' actions qualified as conduct on tribal lands and made the insurers subject to tribal jurisdiction. 

    Many trips had organized trial and appellate court systems, law-trained judges, and extensive codes. The Suquamish Tribe had a trial court and court of appeals, and it required its judges to have graduated from an accredited law school and to be licensed to practice law.

    The panel did nothing but correctly apply Ninth Circuit precedent. The court's decision to deny rehearing en banc was grounded in precedent and common sense.