By Andrew Westney

Law360 (August 19, 2020, 8:38 PM EDT) -- A D.C. federal judge on Wednesday refused the Shawnee Tribe's bid to force the Treasury Department to retain $12 million in COVID-19 funding the tribe claims it's owed, saying the court had no say over how the government decided to divvy up $8 billion for tribal governments in the CARES Act.

The Oklahoma-based tribe had asked the court for a preliminary injunction, claiming it was underfunded in an initial $4.8 billion distribution of the Coronavirus Aid, Relief and Economic Security Act funding because Treasury used an allegedly "false" population data point when calculating how much money to give to the tribe, showing the tribe as having a population of zero when it actually has more than 2,100 members.

U.S. District Judge Amit P. Mehta, who has handled several suits connected with the tribal CARES Act funding, said the Shawnee Tribe's argument "fares no better" than the Prairie Band Potawatomi Nation's earlier effort for an injunction, which the judge rejected in June.

While the Shawnee Tribe claimed Treasury's use of Indian Housing Block Grant data from the U.S. Department of Housing and Urban Development wasn't just flawed — as the Prairie Band had argued — but "objectively false" because it showed the Shawnee Tribe as having no members, Treasury Secretary Steven Mnuchin still had the latitude to use that data as he saw fit to determine what each tribe should receive, the judge said.

"The secretary's selection of the HUD tribal population data set, however imperfect it may be, is a discretionary agency action that is not subject to judicial review," according to the opinion.

And setting aside money for the Shawnee Tribe would keep it back from Alaska Native corporations, known as ANCs, who the judge ruled in July should receive a share in the funds but haven't yet received any payments while a group of federally recognized tribes challenge that decision in the D.C. Circuit.

"The monetary burden of plaintiff's claim would therefore fall almost exclusively on the ANCs, whose share of CARES Act funds, through no fault of their own, has already been delayed far beyond the statutory deadline," the judge said.

The Treasury Department paid out an initial $4.8 billion of the CARES Act funds to tribes based on the HUD population information starting May 5, well after a 30-day deadline to do so had passed following the March 27 enactment of the law.

On June 11, Judge Mehta rejected the Prairie Band Potawatomi Nation's bid to stop the remaining $3.2 billion in COVID-19 relief from being paid to tribes, saying the Nation hadn't shown that funding to all tribes should be held up to let the Nation pursue claims it was shortchanged millions of dollars in the population-based distribution.

In his opinion denying the requested injunction, the judge said he didn't have jurisdiction to hear the tribe's challenge to Treasury's plan to distribute the funds, saying the CARES Act "does not require the secretary to even consider population data, let alone population data of a particular kind."

And on June 29, the judge ruled in a suit by the Confederated Tribes of the Chehalis Reservation and other tribes that the for-profit Alaska Native corporations qualify as "Indian tribes" eligible for funding under the CARES Act. That ruling is on hold while the tribes pursue an expedited appeal with the D.C. Circuit, with oral arguments set for Sept. 11.

In Wednesday's opinion, Judge Mehta said the Administrative Procedure Act doesn't presume that Mnuchin's funding allocation can be reviewed, as the Shawnee Tribe contended, and that there is in the D.C. Circuit instead a "presumption of non-reviewability" that the court applied "just as it did in Prairie Band."

The judge also rejected the Shawnee Tribe's argument that Mnuchin's decision to use the specific HUD data could be challenged even if basing his choice on population data couldn't be, saying it wasn't clear that the secretary divided his decision-making that way. Even if he did, the use of the HUD data "is no more reviewable than the initial decision to use population as a proxy for increased expenditures," the judge said.

Congress in the CARES Act gave the secretary broad authority to decide how to allocate the tribal funds, according to the opinion.

"Far from cabining the secretary's discretion, Congress codified it," the judge said. "So, the secretary's choice of the HUD data over perhaps more comprehensive, and even more accurate, tribal population statistics is not subject to judicial review."

With respect to the ANCs, the judge said the companies might have been shortchanged as the Shawnee Nation claims to have been.

"Granting plaintiff's request for relief would amount to a judicial rebalancing of the allocation decisions made by the secretary, which the court is in no position to do," the judge said.

Pilar Thomas of Quarles & Brady LLP, counsel to the Shawnee Tribe, said the tribe was "disappointed" with the ruling and said she thought the judge "did not give enough credence to the very concrete and major differences" between the tribe's suit and the Prairie Band suit, adding that Treasury "made an obviously wrong decision using obviously wrong data."

Thomas said the Shawnee Tribe will weigh its options, including whether to appeal Wednesday's ruling or proceed in the district court on the merits of its claims.

The Shawnee Tribe is represented by Pilar Thomas, Jonathan P. Labukas and Nicole L. Simmons of Quarles & Brady LLP.

The federal government is represented by Kuntal Cholera and Jason C. Lynch of the U.S. Department of Justice's Civil Division.

The case is Shawnee Tribe v. Mnuchin et al., case number 1:20-cv-01999, in the U.S. District Court for the District of Columbia.

--Additional reporting by Julia Arciga. Editing by Orlando Lorenzo.

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