The recent piece by Tim Korte of The Associated Press, entitled "New Mexico casino lawsuit calls tribal sovereignty into question," may be news to New Mexicans but it is old news for many of us who follow the issue of sovereignty as it applies to business contracts as conducted by the tribes with non-Indians.

The reason we don't hear much about the connection with this lawsuit and the possibility of other lawsuits regarding sovereignty is because our local journalists can't connect the dots; what occurs in our local tribal casinos is also happening nationwide.

In the New Mexico case, attorney Sam Bregman has petitioned the U.S. Supreme Court to hear a case where a client, retired Albuquerque city worker Gary Hoffman, sued Sandia Resort and Casino over what the tribe characterized as a malfunctioning slot machine that displayed a $1.6 million "jackpot." In New Mexico, both the state District Court and the New Mexico Court of Appeals said that the tribes' sovereign immunity kept them from being sued.

Bregman may not be as crazy as some think and he may not be the only attorney suing tribes, including tribal casinos that have not only not paid up on "malfunctioning" machines but also on potentially much larger issues — like how are non-Indian investors going to get their money back if tribal casinos go belly up?

According to a November, 2009 copyrighted article in The Financial Times by Nicole Bullock, tribes have financed "casinos projects with debt including more than $5 billion in high-yield bonds, according to Barclay's Capital."

Of particular interest is one of the world's largest casinos, owned by the Connecticut Mashantucket Pequot tribe, which is reportedly $2 billion in debt to its lenders and "has stopped making its annual $100,000 per capita payment to tribal members."

A July 16, 2010 article by New England journalist Scott Van Voorhis says "the downturn is taking its toll on the Indian gaming industry as aggressive lenders push for payment on billions in debt as cash-starved federal tax men ramp up the pressure, as industry observers say." According to Van Voorhis, the Internal Revenue Service has launched a "wide-ranging probe to crack down on alleged tax evasion in 'Indian Country,' one that appears to be focused heavily on certain tribal casino operators, businesses and governments."

Locally, our own Buffalo Thunder appears to be in arrears an approximate $33 million on its $245 million bond payment as last reported in The New Mexican May 19, 2010. Since then things may have changed as there is very little news reported on this issue. However, the question remains, how will non-Indian investors get their money back on their investments on the "casino" bonds if tribes can't meet the payments or, worse, go bankrupt and use the "sovereignty" card as their defense?

According to the Financial Times article of 2009, the answer may be as clear as mud. An attorney quoted in the article says, "An argument can be made that the tribe is a governmental unit, which could, if determined to be true, bar it from seeking relief under Chapter 11 altogether." If the U.S. Supreme Court refuses to hear the Hoffman/Bregman case, will it end attempts by other lawyers regarding default, nonpayment and possible bankruptcies in "Indian country?" I seriously doubt it; sooner or later the Supreme Court will have to deal with this issue as business among non-Indians and Indians increases.

When is a contract not a contract, when is "sovereignty" applicable, and maybe the most important question is, if a tribes are not willing to waive "sovereignty" should any entity do business with them?

As with the gambling compacts, tribes have had to make some concessions with the states if they want to continue to operate, including the waiver to be sued, if in some cases there are personal injuries or damage at a "sovereign" casino. However, with the Pequot tribe stating on Aug. 3 that it will challenge the legality of a labor election where workers voted 190 to 145 in favor of a union, contending that it's a "sovereign" nation and federal labor law does not apply to it, you can be sure that sooner or later our nation's highest court won't be able to turn its back on these issues.

Writer/historian Orlando Romero may be reached at nambe1@aol.com.