Alleged violation of antifraud provision of state securities law, which was incorporated into ANCSA regarding shareholder petition to lift alienability restrictions, raised federal question and therefore was within federal court jurisdiction.
Plaintiff–Appellee Cook Inlet Region, Inc. (“CIRI”) is an Alaska Native Regional Corporation formed under the Alaska Native Claims Settlement Act (“ANCSA”). Defendants-Appellants Robert W. Rude and Harold F. Rudolph are shareholders of CIRI and former members of CIRI’s Board of Directors.In 2009, Plaintiff CIRI filed suit against Defendants, alleging that they had violated ANCSA and Alaska law. The district court held that it had federal question jurisdiction over the ANCSA claims and supplemental jurisdiction over the state-law claims. On appeal, Defendants challenge the court’s holding that it had subject matter jurisdiction over the ANCSA claims. We affirm the district court.Congress enacted ANCSA in 1971, two years after the discovery of oil in Prudhoe Bay. Alaska Native Claims Settlement Act, Pub. Law No. 92–203, 8 Stat. 688 (1971) (codified as amended at 43 U.S.C. §§ 1601–1629h); see also Martha Hirschfield, Note, The Alaska Native Claims Settlement Act: Tribal Sovereignty and the Corporate Form, 101 Yale L.J. 1331, 1335–36 (1992) ( “Oil companies eager to exploit Alaska’s natural resources were unwilling to begin development until title to the land had been quieted.”). Under ANCSA, all Native claims to Alaskan land based on aboriginal use and occupancy were extinguished, and Native Alaskans were granted monetary compensation and title to forty million acres of land. See John F. Walsh, Note, Settling the Alaska Native Claims Settlement Act, 38 Stan. L.Rev. 227, 227 (1985).
Defines where disputes must be litigated (state vs. federal), which affects cost, leverage, and practical enforceability for shareholders.