## Facts

- Saipan was part of the Trust Territory of the Pacific Islands, administered by the United States under a U.N. Trusteeship Agreement requiring economic advancement and regulation of natural resources.
- Continental Airlines sought permission to build and operate a hotel on public land adjacent to Micro Beach on Saipan.
- A local Land Advisory Board unanimously recommended reserving the area for public park purposes, but the District Administrator recommended approving a lease.
- The High Commissioner (a U.S.-appointed official) executed the lease on behalf of the Trust Territory government in 1972.
- The lease faced substantial opposition from Saipan’s elected bodies; it was supported by the U.S. Department of the Interior and certain appointed officials.
- Trust Territory citizens sued in U.S. district court alleging, among other claims, violations of the Administrative Procedure Act (APA) and the National Environmental Policy Act (NEPA) and asserting enforceable rights under the Trusteeship Agreement.
- The district court dismissed, concluding the Trust Territory government was not a federal agency under APA/NEPA and that the Trusteeship Agreement created no individual rights enforceable in U.S. federal court.

## Issues

1. Whether the Trust Territory government or the High Commissioner’s lease approval was action of a “federal agency” subject to APA and NEPA review in U.S. district court.
2. Whether the Trusteeship Agreement conferred enforceable individual rights that Trust Territory inhabitants could assert in U.S. federal court.
3. Whether challenges to the legality of the High Commissioner’s actions had to be pursued first in the Trust Territory’s own courts, and what happens if those courts lack jurisdiction.

## Decision

- The Ninth Circuit affirmed the dismissal.
- The affirmance was without prejudice to refiling in U.S. district court if the High Court of the Trust Territory denied jurisdiction to review the High Commissioner’s actions.
- The court accepted that the Trust Territory government was not a “federal agency” for purposes of direct APA/NEPA review in this posture.
- The court declined to issue a definitive merits ruling on the reach of NEPA or on treaty-based enforceability, emphasizing that the local judicial system should address the legality of the High Commissioner’s conduct first.

## Legal Principles

- Entities treated as a U.S. territory or possession are excluded from the APA definition of “agency,” limiting APA-based federal judicial review of their actions.
- Where a governing framework is structured to develop self-government, disputes over local executive decisions should ordinarily be brought first in the local courts established for that polity.
- A federal appellate court may affirm dismissal on forum-allocation grounds while preserving the right to return to federal court if the local court system refuses jurisdiction, to avoid leaving plaintiffs without any judicial forum.

## Conclusion

The Ninth Circuit required the plaintiffs to pursue review in the Trust Territory’s courts before seeking U.S. district court intervention, affirming dismissal but allowing refiling in federal court if the Trust Territory judiciary declined jurisdiction over the High Commissioner’s actions.


People of Saipan v. U.S. Dep’t of Interior, 502 F.2d 90 (9th Cir. 1974)