District of Minnesota — Bankruptcy Court

Minnesota Bankruptcy Court Holds Pokagon Potawatomi Gaming Per Capita Payments are Not Part of Debtor’s Estate

ilpc

Here are the materials in In re Musel (D. Minn. Bkrcy.):

10 Motion to Turnover

14 Response

22 Trustee Brief

23 Debtor Brief

25 Memorandum Decision and Order

An excerpt:

The Pokagon Band followed all of the requirements outlined in IGRA – a federal statute – to achieve federal approval for its Gaming Revenue Allocation Plan. Once that RAP was approved, the Band’s sovereignty ensured that it became the sole and exclusive authority for creating and defining property rights for payments it authorized. The RAP’s plain language prevented the creation of any vested property right or interest, and any intangible right to payment was unique to the individual tribal member. As a consequence, the debtor had no property interests that would be considered property of the estate under § 541(a). Additionally, even outside of the Pokagon Band’s sovereign authority to create and define property rights, the per capita payments are not property of the estate in policy, logic, or equity.

Federal Bankruptcy Court Holds Future Tribal Per Caps Not Subject to Capture by Trustees

Matthew L.M. Fletcher1 Comment

Here are the materials in In re Barth (D. Minn. Bkrtcy.):

Order

Debtors Motion for Summary J

Trustee Motion for Summary J

Debtor Response

Trustee Response

An excerpt:

The Debtors are enrolled members of the Lower Sioux Indian Community in the State of Minnesota. Their predominant source of income is monthly per capita payments they receive from Lower Sioux. In these three adversary proceedings, the Chapter 7 trustees seek orders requiring the defendants to turnover post-petition per capita payments they receive from the Lower Sioux Indian Community, claiming that the payments are contingent property rights that existed at filing and constitute 11 U.S.C. § 541(a) property of the bankruptcy estates. The assertion is based on the plaintiffs’ application of Minnesota law to determine the nature of the per capita payments. The defendants claim that the defendants had no property interest in future per capita payments at filing of the bankruptcies. They claim that tribal law, not Minnesota law, is the applicable law and that tribal law specifically provides that tribal members have no property right in future per capita payments. Plaintiffs and defendants agree that summary judgment is appropriate. The Court agrees with the defendants and holds that they had no property rights in future per capita payments at bankruptcy filing and that they are entitled to summary judgment that their bankruptcy estates have no interest in the payments.

The appellate court affirmed the dismissal of the claim against the Lower Sioux Indian Community earlier; we posted materials here.