Seneca Nation v. Hochul: Second Circuit Permits Nation's Long-Pending Challenge to Thruway Easement to Proceed, Rejecting State's Eleventh Amendment and Collateral Estoppel Defenses

Jaclyn Rommeney

Seneca Nation brought forth this lawsuit seeking relief from the defendant’s continuous use of an invalid easement over its sacred tribal land, which the Nation claimed was invalid.¹ The Governor of New York and other defendants appealed the denial of their motion to dismiss.² Defendants contended that Seneca Nation was collaterally estopped from bringing this action based on a 2004 judgment of the U.S. Court of Appeals for the Second Circuit and claim that this lawsuit is barred by the Eleventh Amendment.³ The U.S. Court of Appeals for the Second Circuit found that these challenges lack merit, and thus affirmed the ruling of the lower court.⁴ Therefore the original 2018 proceeding will continue to proceed in district court.

 This lawsuit arises from a 1954 agreement between Seneca Nation and New York, specifically the New York State Throughway Authority (“NYST”).⁵ In that agreement, Seneca Nation conveyed N.Y. an easement over 300 acres of the Cattaraugus Reservation tribal land– the easement granted N.Y. the right to build a portion of the NYST on said land.⁶ In exchange for the easement, N.Y. paid Seneca Nation $75,500.⁷ Interestingly, though, 25 U.S.C. § 177 (commonly referred to as the “Non-Intercourse Act”) explicitly states that any easement over Indian land requires the consent of the United States federal government. According to the complaint, the 1954 agreement never received such consent.⁸

In 1993, Seneca Nation sued N.Y. (herein referred to as Seneca I), the NYST, and the Thruway’s executive director collectively, seeking to invalidate the easement based on the State’s non-compliance with the Non-Intercourse Act.⁹ Seneca Nation desired ejectment and compensatory damages from the suit.¹⁰ The district court dismissed the suit, ultimately holding that N.Y. was an indispensable party under Federal Rule of Civil Procedure 19(b), and that the state was immune under the Eleventh Amendment.¹¹ In 2004, the U.S. Court of Appeals for the Second Circuit affirmed that judgment.¹²

In April 2018, Seneca Nation filed the present suit in district court.¹³ They asserted that the operation of the Thruway constitutes a “continuing unauthorized use… of operating a toll road without a valid easement.”¹⁴ The complaint further alleges that the continuing use of the Thruway “violates the federal treaties and laws establishing the Reservation and protecting it against alienation,” such as the Canandaigua Treaty of 1794, and also violates federal law regulating easements across Native American lands.¹⁵

The relief that Seneca Nation asked the court to provide was threefold. First, an injunction requiring defendants to obtain a valid easement for the portion of the Nation’s Reservation on which the Thruway is situated, so as to bring public benefit from the land, on terms that will equitably compensate Seneca Nation in proportion for the future use of its lands.¹⁶ In the alternative, an order enjoining defendants from collecting tolls for the portion of the Seneca Nation’s Reservation on which the Thruway is situated, without first obtaining a valid easement from Seneca Nation.¹⁷ Second, an injunction requiring the State to hold in escrow all future toll earnings collected on the Thruway that are “fairly attributable to the portion of the Thruway.”¹⁸ Third, a declaration from defendants that they have been violating federal law by not having a valid easement over the land, and that the monies collected from the tolls are derived from this direct violation of federal law.¹⁹ The practical effect of these requests for relief: N.Y. would have to obtain a valid easement over the land, perhaps halting use on that portion of the Thruway until the easement could be obtained, and N.Y. would have to stop collecting toll monies on that portion of the Thruway, impacting the amount of monies the NYST collects per year.

Defendants moved to dismiss the suit on the basis that it was collaterally estopped and was barred by the Eleventh Amendment.²⁰ The district court referred the motion to a magistrate judge, who issued a Report and Recommendation that the motion to dismiss be granted.²¹ After Seneca Nation objected to this, the district court reviewed the motion de novo, rejected the issuance, and promptly denied the motion to dismiss.²² The district court permitted defendants to appeal to the U.S. Court of Appeals for the Second Circuit, which defendants did.²³

1. Collateral Estoppel Claim

The court first began their analysis by reviewing, de novo, the district court's decision granting or denying collateral estoppel.²⁴ Collateral estoppel bars parties from relitigating an issue that has previously been determined by a valid and final judgment if: (1) the identical issue was raised in a previous proceeding; (2) the issue was actually litigated and decided; (3) the losing party had a full and fair opportunity to litigate the issue; and (4) the resolution of the issue was necessary to support a valid and final judgment on the merits.²⁵ Defendants argued that in Seneca I this court decided the same issue the Nation seeks to litigate in the current lawsuit.²⁶ However, the court here found that the issue that was litigated and decided in Seneca I was not present in the current dispute.²⁷ In Seneca I, the issue was whether, under Federal Rule of Civil Procedure 19, N.Y. was an "absent and indispensable party" to the 1993 lawsuit brought by Seneca Nation.²⁸ The prior court held that because the State owned the easement, they became a necessary party to the lawsuit.²⁹ The Court further held that the district court did not abuse its discretion in finding that, under Rule 19(b), the action could not proceed against only the Thruway Authority and its Executive Director without the State because the State was an indispensable party, but also that the State could not be joined because of its sovereign immunity.³⁰

Seneca I was focused on the narrow issue of whether a lawsuit to invalidate the easement could proceed against the NYST and its Executive Director in the absence of N.Y. which, under the circumstances of that suit, enjoyed sovereign immunity– it did not determine whether an action seeking relief from the invalid easement could proceed against other state officials in the absence of the State.³¹ Here, the court did not consider in Seneca I whether a lawsuit could proceed in the absence of the State if the defendants were other N.Y. officials sued in their official capacities.³² Therefore, the issue before the court was not actually decided in Seneca I and so the court found that collateral estoppel did not apply to the present action.³³

2. Eleventh Amendment

Defendants next argued that the lawsuit must be dismissed under the Eleventh Amendment.³⁴ Under the Eleventh Amendment, a state may be sued in federal court by Native American tribes only if the state consents.³⁵ However, a plaintiff may avoid the Eleventh Amendment restriction, by suing individual state officers in their official capacities, as opposed to the state, provided that the complaint “(a) alleges an ongoing violation of federal law and (b) seeks relief properly characterized as prospective.”³⁶ Suits of this nature implicate the Supreme Court’s decision in Ex parte Young– a case that granted an exception to the Eleventh Amendment immunity where the two aforementioned criteria were satisfied.³⁷ Seneca Nation sought to satisfy the same criteria in order to challenge the validity of the easement.³⁸ Defendants claim that the lawsuit does not meet the requirements of the Ex parte Young doctrine.³⁹ In determining whether a case falls under this doctrine, the Court conducted a “straightforward inquiry” into whether the complaint (1) alleges an ongoing violation of federal law and (2) seeks prospective relief.⁴⁰

3. Ongoing Violation of Federal Law

Defendants argued that the lawsuit did not allege an ongoing violation of federal law, but only that the 1954 grant of the easement violated federal law.⁴¹ The Court did not agree because the present suit was primarily concerned with the ongoing effect of the invalidity of an easement.⁴² Plaintiff argued that they will continue to suffer irreparable harm without injunctive relief because its property will continue to be invaded without authorization.⁴³ Plaintiff pointed to the Canandaigua Treaty of 1794 to substantiate its claim. The Treaty states that “the land of the Seneca Nation is… to be the property of the Seneca Nation,” which shall not be disturbed “in the Nation’s free use and enjoyment thereof.”⁴⁴ The court has previously held that the term “free use and enjoyment” in the Treaty is to be interpreted as preventing American encroachment onto Seneca lands, or interference with the Seneca Nation’s use of its lands.⁴⁵ The allegation that Seneca Nation’s free use and enjoyment of its protected land is continuously impaired by the presence of an unlawful easement therefore reflects an ongoing harm to the Nation.⁴⁶ Accordingly, the Court found that Ex parte Young’s first requirement is satisfied.⁴⁷

4. Prospective Relief

The defendants proffered the argument that plaintiffs were seeking compensation for a past wrong, rather than prospective relief (which is a requirement of this type of claim).⁴⁸ Both sides cited Papasan v. Allain to support their argument, but the court ultimately interpreted that case to be in favor of the plaintiff.⁴⁹ In Papasan v. Allain, Mississippi school officials and schoolchildren asserted two claims against Mississippi:

First, that a prior sale of land, the proceeds of which were supposed to be used to fund public education but were not so used, abrogated the State's ongoing trust obligations to the schoolchildren. Second, that the present unequal distribution of state funds in public education violated the schoolchildren's equal protection rights because children in schools that received less funding were denied a minimally adequate level of education while children in schools that received more funding were not.

⁵⁰ The court held that, with respect to the second claim, the alleged ongoing constitutional violation of “unequal distribution by the State of the benefits of the State's school lands is precisely the type of continuing violation for which a remedy may permissibly be fashioned under Young.”⁵¹

Seneca Nation alleged that its free use and enjoyment of its land had been continually violated by the presence of an unlawful easement that began in 1954.⁵² Thus, it is like the “Papasan equal protection violation, which, while it stemmed from a past wrong, continued to cause constitutional violations in the form of ongoing unequal distribution of state funds.”⁵³ After examining the relief sought in this case, the court similarly concluded that it was prospective, because the complaint claimed free use and enjoyment.⁵⁴

The court highlighted that Seneca Nation does not seek relief for a “past loss” equivalent to that which the Papasan plaintiffs sought in their first claim and that the court found barred by the Eleventh Amendment.⁵⁵ Instead, it sought to compel defendants to “obtain a valid easement for the portion of the Nation’s Reservation on which the Thruway is situated on terms that will in the future equitably compensate the Nation pro rata for future use of its lands.”⁵⁶ There is thus no accrued monetary liability that Seneca Nation stood to recover here.⁵⁷ The court accordingly found that the complaint alleges an ongoing violation of federal law and seeks prospective relief.⁵⁸

5. Quiet Title Exception

Defendants’ remaining argument was that the lawsuit fell within an exception to the Ex parte Young doctrine highlighted by the Supreme Court in Idaho v. Coeur d'Alene Tribe of Idaho.⁵⁹ In that case, the Court held the Ex parte Young exception inapplicable to a suit alleging an ongoing violation of federal law, in which prospective declaratory and injunctive relief was sought against an officer named in his individual capacity.⁶⁰ Thus, the Court held that the suit was barred by the Eleventh Amendment.⁶¹ 

In Coeur d'Alene Tribe, a Native American tribe sought to bring an Ex parte Young lawsuit to “establish its entitlement to the exclusive use, occupancy, and right to quiet enjoyment of certain submerged lands that, while within the boundaries of the tribe's reservation, had been claimed and governed by Idaho for centuries.”⁶² The tribe also sought declaratory relief that all Idaho laws and regulations were invalid as applied to that land.⁶³ The Court concluded that the tribe's suit was “the functional equivalent of a quiet title action . . . in that substantially all benefits of ownership and control would shift from the State to the Tribe,” and that the Eleventh Amendment bars such an action by a tribe against a state.⁶⁴ It then held that “if the Tribe were to prevail, Idaho's sovereign interest in its lands and waters would be affected to a degree fully as intrusive as almost any conceivable retroactive levy upon funds in its Treasury,” which a state's sovereign immunity under the Eleventh Amendment prohibits.⁶⁵ Accordingly, the Ex parte Young exception was held to be inapplicable.⁶⁶

The present case is not the functional equivalent of a quiet title action. Here, Seneca Nation holds fee title to the land in question, and N.Y.’s only interest is a possessory one granted by the permanent easement.⁶⁷ It is important to recall that there is a difference between possession of property and owning the title to a property. Accordingly, a court may properly find under Ex parte Young “that an official has no legal right to remain in possession of property, ‘thus conveying all the incidents of ownership to the plaintiff,’ but without ‘formally divesting the State of its title.’”⁶⁸

The present case can be distinguished from Coeur d’Alene Tribe’s facts even further. N.Y. has not historically governed the land currently in dispute.⁶⁹ Additionally, Seneca Nation does not argue that the State’s laws and regulations do not apply to the land in question.⁷⁰ The present action is thus even further removed from Coeur d'Alene Tribe, in which the tribe claimed ownership over submerged lands in navigable waters, which due to their “public character” made them intertwined with Idaho's sovereignty.⁷¹ Here, nothing comparable to submerged lands in navigable waters is at issue. In sum, Seneca Nation does not assert property rights over land to which N.Y. has traditionally held the title and does not seek a declaration that N.Y.’s laws and regulations do not apply to the area in dispute.⁷² Therefore, the quiet title exception to Ex parte Young outlined by the Court in Coeur d'Alene Tribe has no application here.⁷³

Accordingly, the court concluded that the lawsuit fell under the Ex Parte Young exception to the Eleventh Amendment.⁷⁴ Thus, neither collateral estoppel nor the Eleventh Amendment barred Seneca Nation from proceeding in this case.⁷⁵ Therefore, the court affirmed the order of the district court denying the motion to dismiss.⁷⁶

1. Seneca Nation v. Hochul, 58 F.4th 664 (2023).

2. See id at 667.

3. See id.

4. Id.

5. Id.

6. Seneca Nation v. Hochul, 58 F.4th 664, 667 (2023).

7. Id.

8. Id.

9. Id.

10. Id.

11. Id.

12. Seneca Nation v. Hochul, 58 F.4 664, 667 (2023).

13. Id.

14. Seneca Nation v. Hochul, 58 F.4th 664, 667 (2023).

15. Id; See Canandaigua Treaty of 1794 art. 2, Dec. 2, 1794.

16. Seneca Nation v. Hochul, 58 F.4th 664, at 668 (2023).

17. Id.

18. Id.

19. Id.

20. Id.

21. Seneca Nation v. Hochul, 58 F.4th 664, at 668 (2023).

22. Id.

23. Id.

24. Id.

25. Id (citing Bear, Stearns & Co. v. 1109580 Ontario, Inc., 409 F.3d 87, 91 (2d Cir. 2005)).

26. Seneca Nation v. Hochul, 58 F.4th 664, at 668 (2023).

27. Id.

28. Id at 169.

29. Seneca Nation v. Cuomo, 484 F. Supp. 3d 65, 79 (W.D.N.Y. 2020).

30. Id.

31. See Am. Trucking Ass'n, Inc. v. N.Y. State Thruway Auth., 795 F.3d 351, 357 n.2 (2d Cir. 2015) (noting that Seneca I “stands for the unsurprising proposition that an absent sovereign may be a necessary party to a lawsuit that calls into question a real property interest of the sovereign”).

32. Seneca Nation v. Hochul, 58 F.4th 664, at 669 (2023).

33. Id at 670.

34. Id.

35. See Dairy Mart Convenience Stores, Inc., 411 F.3d 367, 371 (2d Cir. 2005); W. Mohegan Tribe & Nation v. Orange Cnty., 395 F.3d 18, 20 (2d Cir. 2004).

36. See Deposit Ins. Agency, 482 F.3d 612, 618 (2d Cir. 2007).

37. Ex parte Young, 209 U.S. 123, 28 S.Ct. 441, 52 L.Ed. 714 (1908).

38. Seneca Nation v. Hochul, 58 F.4th 664, at 670 (2023).

39. Id.

40. Verizon Md., Inc. v. Pub. Serv. Comm'n of Maryland, 535 U.S. 635, 645, 122 S. Ct. 1753, 152 L. Ed. 2d 871 (2002).

41. Seneca Nation v. Hochul, 58 F.4th 664, at 670 (2023).

42. Id.

43. Id.

44. Canandaigua Treaty of 1794 art. 2, Dec. 2, 1794.

45. Perkins v. Comm'r of Internal Revenue, 970 F.3d 148, 158 (2d Cir. 2020).

46. Seneca Nation v. Hochul, 58 F.4th 664, at 671 (2023).

47. Id.

48. Id.

49. Papasan v. Allain, 478 U.S. 265, 106 S.Ct. 2932, 92 L.Ed.2d 209, 274 (1986).

50. Id.

51. Id at 282.

52. Seneca Nation v. Hochul, 58 F.4th 664, at 671 (2023).

53. Id.

54. Id.

55. Id at 672.

56. Id.

57. Seneca Nation v. Hochul, 58 F.4th 664, at 671 (2023).

58. Id.

59. Idaho v. Coeur d’Alene Tribe of Idaho, 521 U.S. 261, 270, 117 S. Ct. 2028, 138 L. Ed. 2d 438 (1997).

60. Id at 287.

61. Id.

62. Seneca Nation v. Hochul, 58 F.4th 664, at 672; citing Idaho v. Coeur d’Alene Tribe of Idaho, 521 U.S. 261, 270, 117 S. Ct. 2028, 138 L. Ed. 2d 438 (1997).

63. Seneca Nation v. Hochul, 58 F.4th 664 at 672.

64. Id (citing Idaho v. Coeur d’Alene Tribe of Idaho, 521 U.S. 261, 270, 117 S. Ct. 2028, 138 L. Ed. 2d 438 (1997)).

65. Id at 277.

66. Id at 287.

67. Seneca Nation v. Hochul, 58 F.4th 664 at 673.

68. See Deposit Ins. Agency, 482 F.3d at 620 (quoting Coeur d'Alene Tribe, 521 U.S. at 290 (O'Connor, J., concurring)).

69. Seneca Nation v. Hochul, 58 F.4th 664 at 673.

70. Id.

71. Id.

72. Id.

73. Id.

74. Seneca Nation v. Hochul, 58 F.4th 664, at 674.

75. Id.

76. Id.