Peabody Coal Company Peabody Western Coal Company Peabody Holding Group, Inc. v. Navajo Nation

This appeal addresses whether a district court has subject matter jurisdiction over a suit brought for enforcement of an arbitration award by a non-Indian corporation against the Navajo Nation (or “the Nation”), a federally recognized Indian tribe located primarily in Arizona. The complaint filed by Plaintiffs Peabody Coal Company, Peabody Western Coal Company, and Peabody Holding Group, Inc., (collectively “Peabody”) seeks enforcement of an arbitration settlement agreement made between the parties in 1998 setting royalty rates for coal mined pursuant to a commercial lease. The lease itself had been previously approved by the Department of the Interior. Peabody contends that the federal question in this case is the enforceability of commercial Indian mineral leases approved by the Secretary of the Department of the Interior (“Secretary”) under federal law. We hold that Peabody’s claim does not meet the requirements of federal question jurisdiction under 28 U.S.C. § 1331 , and we affirm the district court’s dismissal of the case.

I

In 1964, Peabody’s predecessor in interest (the Sentry Royalty Company) leased the right to mine substantial coal deposits located on Navajo lands…