Chugach Alaska Corp. v. Lujan

ERA VII — Corporate Maturation & Expansion
Court Case
1990

In 1976 the Grouse Creek Corporation applied as a Native group for a conveyance of 6720 acres of National Forest land.[1]�Under the applicable regulations, a group qualifies as a Native group only if a majority of the residents of the locality are members. The Bureau of Indian Affairs found that the Grouse Creek group did not qualify: Only eleven of thirty-one residents were members of the Grouse Creek group. The Grouse Creek group appealed, and the administrative law judge redrew the boundaries of the locality. Nonetheless, he found that the Grouse Creek group fell just short of meeting the majority requirement even within the new boundaries: Fifteen of thirty residents were members. Because less than a majority of the residents of the locality were members of the Grouse Creek group, it did not qualify as a Native group.

What Happened

Plaintiffs argue that because the clause “who comprise a majority of the residents” modifies the word “Natives,” the statute requires that a majority of the residents be Natives and doesn’t require that a majority be members. Admittedly, the clause dangles a bit – it is not entirely clear to whom the word “who” refers. One plausible reading, however, is that the clause modifies the entire preceding phrase – “tribe, band, clan, village, community or village association of Natives” – not just the word “Natives,” thus requiring that a majority of the residents be members of the tribe, band, clan, village, community or village association that seeks the conveyance.Even if we were to read “who comprise a majority” as modifying Natives, we would still have to rely on the preceding half of the definition in determining to which Natives it refers; the context indicates that the Natives who must comprise a majority of the residents are the twenty-five or fewer Natives who make up the tribe, band, clan, village, community or village association. It is one of these interpretations, neither of which is unreasonable, that the Secretary adopted in his regulations.As plaintiffs point out, other sections of ANCSA do require Natives, not group members, to constitute a majority of the residents. For example, section 1610(b)(3), which determines the eligibility of certain Native villages for ANCSA benefits, requires “a majority of the residents [to be] Natives.” 43 U.S.C. § 1610(b)(3)(B). Had Congress used identical language in spelling out the criteria for Native groups, 43 U.S.C. § 1602(d), the Secretary would have been required to count all Natives toward the majority requirement. But Congress used different language here, language that is readily susceptible to the Secretary’s interpretation. If anything, Congress’ use of different language in different parts of ANCSA suggests that it meant the provisions to function differently.

Why It Matters Today

Clarifies what shareholder communications and voting-related conduct trigger (or don�t trigger) regulatory and corporate-law requirements.

Related Patterns

Pattern 7: Cultural Expectations vs. Corporate Law

Related Governance Themes

Clear Shareholder Rights Documentation
‍ Transparency Around Decision-Making Processes

Sources

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