The Sault Ste. Marie Tribe of Chippewa Indians is continuing its legal fight to secure a new casino.
On Monday, the tribe urged the D.C. Circuit Court to reverse a previous ruling by U.S. District Judge Trevor N. McFadden that the Department of Interior was correct in its refusal to take into trust a pair of properties where the tribe sought to build retail casinos.
It’s the latest in the saga for the tribe to build casinos in New Boston, near Detroit Metropolitan Airport, as well as Lansing.
History of Sault Ste. Marie tribe’s legal battle
The Sault Ste. Marie Tribe of Chippewa Indians is headquartered in Sault Ste. Marie. Specifically, they operate Kewadin Casinos, which have five locations throughout the Upper Peninsula.
Due to the limited population surrounding tribal headquarters, the SSM tribe feels generating gaming revenue in the lower peninsula is the only way to garner enough money for the tribe to continue to develop.
Notably, the SSM tribe purchased the land in question at both locations in 2012. Specifically, it purchased a 71-ace plot of land in New Boston and a 2.3-acre parcel of land in Lansing.
And, they attest that the purchases were made with their Self-Sufficency Fund, with the intent of having the US DOI place the lands into trust for the building of casinos. The Kewadin Casinos Gaming Authority conducted further development plans.
DOI refused to take properties into trust
In 2017, the Department of Interior refused to take either property into trust. The DOI stated the Michigan Indian Land Claims Settlement Act doesn’t authorize the tribe to use the fund for gambling.
In the summer of 2018, the SSM tribe sued the DOI, arguing that the decision undermined their welfare and went against the MILCSA.
Notably, the MILCSA was established in 1997 to help settle land disputes for Michigan tribes. Specifically, the government has to take into trust lands purchased by the tribe’s Self-Sufficiency Fund as long as those lands meet certain criteria set forth by the agreement.
And those criteria include that the fund is used for the purposes of social welfare through educational, health, cultural or charitable pursuits. SSM believed that these lands would serve the purpose of social welfare as part of the MILCSA, as they would help the well-being of their members through increased gambling revenue.
The DOI found that the plans to build casinos on these locations wouldn’t achieve the social welfare criteria.
D.C. federal court supports DOI
In March, McFadden ruled with the DOI on their decision not to take the two SSM properties into trust.
In the ruling, McFadden concluded that the government had properly applied the MILCSA. He felt the tribe failed to provide evidence that putting the land into trust would directly benefit the key criteria needed as part of the agreement.
Further, the three Detroit casinos, as well as other Michigan tribes, opposed the efforts of the SSM tribe.
Now, the tribe wants the March order by McFadden overturned.
On Monday, they laid out their argument. The hope is for a ruling allowing the lands to be put in trust to build new casinos in Michigan.
Kewadin gives out $25 million to casino investors
Also, the legal battle with the DOI is not the only one the tribe has had.
Last January, Kewadin Casinos Gaming Authority was ordered to pay $88.9 million. And the money was to go to two separate investor groups over the failed casino plans.
Specifically, Kewadin had reached deals with JLLJ Development LLC and Lansing Future Development II LLC. And, the two groups were to aid the KWG in building the casinos once they were given the go-ahead by the DOI. Significantly, the investor groups gave the tribe $9 million at the time.
Further, the investor groups alleged that KGCA misrepresented their legal entitlement to the land, which led to the loan being given. They were seeking lost profits and potential shared revenue they anticipated coming from the casinos being built.
In April, the $88.9 million penalty was dropped to $25 million. The drop in fee came as part of a settlement agreement to prevent further litigation.
