## Facts

- The Cheyenne–Arapaho Tribes’ reservation was established by treaty in 1865 and defined by an 1869 Executive Order.
- In 1891, Congress ratified an allotment and cession arrangement under which the Tribes ceded broader reservation lands while individual tribal members received allotments.
- The parcels at issue were allotted to tribal members and are held by the United States in trust, subject to federal restrictions on alienation.
- The Tribes’ Business Committee and Tax Commission enacted a severance tax on oil and gas produced within tribal jurisdiction, including production from these allotted trust lands.
- Nineteen oil-and-gas companies and one individual lessee (non-Indians) held leases on the allotted lands and challenged the Tribes’ authority to impose the tax.
- Tribal courts upheld the tax; the federal district court granted summary judgment for the tribal officials; the lessees appealed.

## Issues

1. Whether the allotted trust lands constitute “Indian country” under 18 U.S.C. § 1151 for purposes of civil jurisdiction.
2. Whether the 1891 allotment/cession legislation disestablished or otherwise removed tribal civil jurisdiction over the allotted trust parcels.
3. Whether the Tribes have inherent authority to impose a severance tax on non-Indian lessees’ oil and gas production on those lands absent federal withdrawal or preemption.

## Decision

- The Tenth Circuit affirmed summary judgment for the tribal officials.
- The court held the allotted trust lands are Indian country because they are set apart for Indians under federal superintendence.
- The court found the 1891 allotment/cession framework did not clearly terminate Indian country status or tribal jurisdiction over the allotted parcels.
- The court held the Tribes retained inherent sovereign authority to tax non-Indians conducting extraction activities on these Indian country lands.
- The court found no federal statute or regulatory scheme that expressly or impliedly preempted the tribal severance tax.

## Legal Principles

- “Indian country” under 18 U.S.C. § 1151 includes allotted trust lands set apart for Indians under federal superintendence, and the definition applies in civil as well as criminal jurisdictional contexts.
- Congressional intent to diminish Indian country or divest tribal jurisdiction must be clearly expressed; allotment and cession statutes are not read to terminate tribal authority absent such clarity.
- Tribes generally retain inherent power to tax non-Indians conducting business on Indian lands unless Congress has withdrawn that power or federal law preempts the tax.
- In evaluating tribal taxation of on-reservation (or Indian country) economic activity, courts look for an applicable federal prohibition or a federal scheme that leaves no room for tribal taxation.

## Conclusion

The court upheld the Cheyenne–Arapaho Tribes’ severance tax as applied to non-Indian lessees producing oil and gas from allotted lands held in federal trust, concluding the parcels are Indian country and that neither the 1891 allotment/cession law nor federal regulation displaced the Tribes’ retained taxing authority.


Mustang Prod. Co. v. Harrison, 94 F.3d 1382 (10th Cir. 1996)