Editor’s Note: The entire SOAR complaint is below, and here is the pdf version. The suit was also previously filed in Fort Berthold Tribal Court alleging Mandan, Hidatsa and Arikara tribal council members of self-dealing.
UNITED STATES DISTRICT COURT
DISTRICT OF NORTH DAKOTA
Save Our Aboriginal Resources (SOAR);
Marty Young Bear, Jill Gillette, Joletta
Bird Bear, Doreen Lyons,
v. No. 4:2013-cv-00026
Bureau of Indian Affairs, Great Plains
Area Director, Weldon Loudermilk;
Secretary of Interior, Kenneth Salazar;
Assistant Secretary of Indian Affairs,
1. Introduction. Fort Berthold Indian Reservation. Tribal
members challenge a cheap oil lease as the Tribe may lose over
$200 million. The council leased to an oil co. that failed to drill
wells, but offered $l million for an “extension” at $30 an acre as
a bonus. The council agreed. The BIA rubber-stamped the lease.
2. Tribal members contend the 30,000 acre lease should be
canceled since the oil minerals are worth $5,000 to $l0,000 per
acre. And the BIA overlooked environmental harm and self2
dealing by council members, who have companies that procure
contracts from companies they are supposed to regulate.
3. Plaintiffs. Save Our Aboriginal Rights (SOAR) is an
association of tribal members, Three Affiliated Tribes and
supporters. Marty Young Bear, Jill Gillette, Doreen Lyons, and
Joletta Bird Bear are tribal members.
4. Defendants. Weldon B. Loudermilk is the Bureau of Indian
Affairs, Great Plains Area Director. Kenneth Salazar is Secretary
of the Interior Dept. (DOI). Kevin Washburn is the Assistant
Secretary of Indian Affairs, DOI. They are sued in their official
5. Jurisdiction. This court has authority under 28 USC Sec.
1331, Admin. Proced. Act, 25 USC Sections 210l, and 81.
6. Oil boom. In 2006 sweet crude oil was hit in the Bakken field,
by Parshall ND on the Reservation. The Indian Minerals Dev. Act
(IMDA) requires a tribal council vote on a lease, then BIA review.
25 CFR Sec. 225.
7. Oil Lease. In 2009 Chair Marcus (Wells) Levings and
council made a lease with Spotted Hawk Development LLC. The
rate was $350 per acre for 30,000 acres. 1 The BIA approved it.
8. Drilling. The lease required wells on five blocks within a set
time limit. Spotted Hawk, a group of speculators from Virginia
with no prior oil experience, drilled one well that produced oil.
9. Failure to Drill. The IMDA lease states if the “Lessee fails to
drill … the Lessor shall the right .. to terminate this Lease ….” at
page 12. In late 2011 new Chairman Tex Hall wrote to Spotted
Hawk that they were not drilling as required. In 2012, the Denver
BIA energy office wanted to cancel the lease. But SD BIA agents
wrote a letter that all was okay.
10. Amended lease. In 2012 Spotted Hawk offered $l million to
“extend” the time to drill. On August 9, 2012 the tribal council
took the money, which amounts to a $30 bonus per acre. And the
council allowed Spotted Hawk to mortgage the leased land. In
early 2013 Spotted Hawk borrowed $l00 million to operate.
11. Council minutes released late. Plaintiffs did not get the 2012
minutes until February 2013. At the August 9, 2012 meeting
1 The Tribe made a bigger 85K acre lease with Dakota 3 at $50 per acre. Spencer Wilkinson, Jr. “flipped”
the lease to Wms oil, and became a Millionaire. “Tribe cheated out of $l billion .” See Pro Publico.org
and Buffalosfire.com. A suit is pending in this court, Two Shields v. S. Wilkinson et. al. No. 4:2012-cv-
M. Packineau moved to approve the lease. The vote was 2 yes, l
no, 2 abstain [no names, secret vote]. Plaintiffs exhibit 1.
12. Conflict of interests. Council man Mervin Packineau
owns US Sand LLC, and Tex Hall owns Mahesu Energy. See
TERO website (contractor list). Packineau backed an amended
lease as his uncle Delvin Foote is allied with Spotted Hawk, and
so Packineau could get work for his company.
13. Chairman Hall solicits contracts for mud supplies, and
hauling water and crude. Hall gets contracts then “subs” to
white companies such as road watering at Mandaree in 2012.
14. A 2006 ethics ordinance allows for sanctions on a council
member or public official, who uses his position for financial gain.
But the council has not appointed committee members. So selfdealing
by tribal officials goes unchecked ….
15. Tribal suit SOAR v. Mervin Packineau et. al. 2 In February
2013 plaintiffs sued council members to enforce the ethics laws
and get the ethics board functioning. The goal is to get the land
2 A 7 member council runs the show. Five had a council meeting in August 2012: Mervin Packineau, Tex
Hall, Judy Brugh and old council members Arnie Strahs and Scott Eagle.
A Nov. 2012 tribal election was held for 3 positions. Randy Phelan replaced Strahs. L. Ken Hall replaced
Scott Eagle. Fred Fox replaced Frank Whitecalfe. Barry Benson is the seventh council member.
bid out at better rates in the Bakken field, e.g. $l0,000 per acre.
Federal suit. Since the BIA approved the amended IMDA lease
under federal law, this suit against the federal defendants is
16. Oil impacts. The plaintiffs are tribal members subject to
dangerous road conditions, heavy truck traffic, and flaring of
gas. Some tribal members live in Fema trailers and many lack
housing. Plaintiffs need funds for basic needs.
Claim. The BIA decision to approve the amended
lease is arbitrary and a breach of trust.
17. Plaintiffs re-allege and incorporate paragraphs 1-16.
18. Secret decision. In February 2013 the BIA office at New
Town, ND said the IMDA lease was approved, but refused to give
out a copy of the written decision saying it was “confidential.”
19. Law. The Secretary of Interior … has a “trust obligation to
ensure that the rights of the tribe or individual Indian are
protected.” 25 USC Sec. 2103 (e). The rules provide for initial
tribal approval, then for BIA review of an IMDA lease. The BIA
issued a final decision over the Spotted Hawk lease in 2012. 3
20. Ample grounds exist to cancel the lease.
21. Failure to drill. First, the IMDA required Spotted Hawk to
drill wells within a set time limit. Spotted Hawk did not comply
with and drill in the five blocks (of land) as required.
22. Failure to compare rates. Second, the BIA must consider
the best interests of the mineral owner [tribe or individual], which
“review of comparable contemporary contractual
arrangements or offers for the development of similar
mineral resources received by Indian mineral owners, by
non-Indian mineral owners, or by the Federal
Government….” 25 CFR Part 225 (c) (d).
23. Oil lease rate in Fall 2012 were $5,000 per acre and higher
in the same area. South of Parshall, ND oil wells initially
come in at over 2,000 Barrels of oil per. 2,000 x $80 per barrel =
$l60,000 one day. $4.8 million per month (one well). See ND
websites, w.dmv.nd.gov/oilgas and milliondollarway.blogspot.
24. Same area. $l3,000 per acre for 240 acres paid by QEP oil
company. Sec. 33 Twnship l50, R 90 W. This is by Skunk Bay and
3 The BIA Area Office handles IMDA approvals. The Assistant Secretary handles disapprovals. The
instant lease approved is a final agency action. Darby v. Cisneros , 509 U. S. 137 (1993) (final decision
made, judicial review proper).
a few miles west of the “Spotted Hawk” lease area. Pls. exhibit 2.
25. Same area. Federal BLM sale. A tract in northern Mountrail
County went for $l9,500 per acre. Feb. 2013. Dickinson News.
26. Huge loss at $350 an acre. Compare, $5,000 per acre x
30,000 acres = $l50 million. $l0,000 per acre x 30K acres = $300
million (on a bonus bid). Or, if the tribe did a joint venture at 5l%
they could get a larger return on a royalty basis. 4
27. Third, the BIA must consider adverse cultural, social and
environmental impacts. Part 225.
28. Plaintiffs are shareholders in the leased land, and Marty
Young Bear, Jill Gillette and Joletta Bird Bear live on the
Reservation. They are harmed by:
a) heavy truck traffic, spills of waste water at well sites and on
area roads. Tribal members and other are injured or killed in
wrecks due to the constant traffic.
b) Drilling and fracking disturbs humans and wildlife such as
nesting eagles in the Deepwater area and Mandaree. In 2012 the
4 Early leases went cheap at l2.5% and $75 dollar per acre. Now, l8% and $600 on up is a good rate, though
most land is already leased.
For a proven field the sky is the limit. See 2012-13 bonus per acre bids at $10,000 on up. Or, the tribe
could do a joint venture and get 51% or more. The BIA is supposed to provide advice.
Tribe canceled deer hunting season, due to scare game.
29. There are 500 wells on the Reservation, with a projected
l,000 more to be drilled, with some under the Lake. West of New
Town, ND a “mini man camp’ is right by the Snow Bird Cemetery.
See also, “This is Mandaree,” Facebook, documenting harm.
The BIA overlooked the negative impacts related to the oil lease.
30. Other. It appears the BIA was duped. Council members
did not disclose conflicts of interests – as council members and oil
contractors – to BIA, as apart of IMDA federal review.
31. Only two of five council members present voted to approve
the 2012 amended lease. BIA normally requires a majority vote.
One vote is tainted, as noted next.
32. Self-interests. Council member Packineau voted to approve
an amended lease and mortgage for Spotted Hawk, to favor his
uncle – an agent of Spotted Hawk oil. And Packineau solicits
sand work from Spotted Hawk. And from others, such as EOG,
Marathon, Slawson, QEP, Petro-Hunt, and Enerplus oil. 5
5 Chairman Tex Hall owns Mahesu co. with a “man camp,” trucks and equipment north of Mandaree, ND.
Packineau and Hall work for the oil companies (by contracts) – while handling mineral leases . Hall is
quoted as saying the tribe is making “better leases.” Pro Publico.org article (Feb. 2013). The Spotted
Hawk lease fiasco shows otherwise.
33. The BIA review under 25 CFR Sec. 225 was arbitrary for
WHEREFORE plaintiffs request:
1. an order to declare that the BIA decision to approve the
amended lease is arbitrary.
2. To order the BIA to take prompt steps to cancel the lease,
and undo the mortgage approval of the Indian trust lands.
3. To set a hearing for declaratory and injunctive relief within
30 days, so as to preserve the tribal minerals.
4. And for other relief deemed just, plus attorney fees and costs.
28 USC Sec. 2412, EAJA.
Dated March 4, 2013.
s/ Vance Gillette
P. O. Box 1461
New Town, ND 58763
Attorney for Plaintiffs