By Andrew Westney

Law360 (June 10, 2021, 9:19 PM EDT) -- The Prairie Band Potawatomi Nation has pressed a D.C. federal judge to set aside $4 million more in COVID-19 relief for the tribe, saying that figure is soundly based on the tribe's population and that the Treasury Department's stance against the request would undermine earlier court rulings.

The U.S. Department of the Treasury last week urged the court to deny the Kansas tribe's bid to increase the amount of Coronavirus Aid, Relief and Economic Security Act funding set aside for the tribe from $7.6 million to about $11.7 million, saying that the court had already rejected the argument that the tribe is entitled to a specific amount of money or any particular method of calculating what the tribe is owed.

The federally recognized Prairie Band said on Tuesday that the court "cannot accept Treasury's argument without in effect dissolving earlier injunctions in this case," including one mandated by the D.C. Circuit.

And the circuit court "has already rejected the sort of unbounded discretion that Treasury claims to possess in selecting a new methodology for the distribution of CARES Act funds to Tribal governments," the tribe said.

In addition, the department's position "provides support for the court enjoining more, rather than less, CARES Act funds," because if the tribe "is not necessarily entitled to a specific amount of funds as Treasury argues, the only fair and sensible solution would be to enjoin all of the reallocated $83 million in CARES Act funds set aside by Treasury" to be distributed this year.

"Rather than restraining none of these funds, as Treasury would argue, the court should restrain all of these funds until Treasury adopts a lawful methodology approved by this court," the tribe said.

The dispute kicked off in mid-2020, when the Shawnee Tribe told an Oklahoma federal court that it wouldn't get the funds it was due under the March 2020 coronavirus relief bill because then-Treasury Secretary Steven Mnuchin had decided to use Indian Housing Block Grant population data as a guide to determine allotment, but that the data was not up to par.

The case got kicked to D.C. federal court and landed on U.S. District Judge Amit P. Mehta's docket, who dismissed it a few months later after finding that the CARES Act wasn't reviewable under the Administrative Procedure Act. But after a trip to the D.C. Circuit, an appellate panel found that the Treasury Department likely underpaid the Shawnee Tribe and some other tribes by basing its funding decisions on data that vastly underestimated their populations.

The Prairie Band then filed a new complaint in January in the D.C. court, arguing along the same lines as the Shawnee Tribe.

On May 25, the Prairie Band asked Judge Mehta for the increase of $4 million in CARES Act funding, saying that the original $7.6 million amount "will likely not satisfy the entire shortfall" owed to the tribe.

In May 2020, the Treasury Department disclosed a spreadsheet that assigned a population metric of 883 to the Prairie Band, but new filings reflected in March that the department relied on a population metric of 747 for the tribe. The Prairie Band's actual certified population is 4,561, which accounts to a shortfall of roughly $12.5 million, according to the tribe's motion.

On June 1, the Treasury Department said the Prairie Band "cannot show that it is likely entitled to any additional payment, much less a payment for the amount they seek," and "could at most secure an order requiring Treasury to do what it has done already: adopt a revised methodology."

The department also said that it didn't raise the same argument in the Shawnee tribe's suit as in the current case, which is that "even if the original methodology was arbitrary and capricious, that does not mean the plaintiff would necessarily be entitled to an additional payment," so the D.C. Circuit never ruled on it.

The Prairie Band said in its reply on Tuesday that a ruling that the tribe can't seek a specific amount of money "would not only undercut [the court's] prior orders, but also violate the D.C. Circuit's mandate."

The Treasury Department did raise that specific argument in the district court, the tribe said, and if it hadn't, "that would hurt, not help, its position," because a federal court "held in similar circumstances [that] a party's failure to advance an argument in opposition to a preliminary injunction may preclude that party from asserting it later."

And the department's new method for distributing the CARES Act funds is "hopelessly flawed and perpetuates the same flaws of the 2020 distribution by creating new, arbitrary funding disparities and failing to fund tribes on the basis of tribal population," the Prairie Band said.

The tribe said that, in addition to increasing the amount set aside in the April 26 preliminary injunction to $11.7 million, the court should "specifically earmark the preliminary injunction funds separate and apart from funds set aside for other tribal governments, such as the Alaska Native corporations, so that the preliminary injunction will remain intact regardless of the outcome of litigation with other tribes or distributions to other tribes."

Alaska Native corporations and the Treasury Department have asked the U.S. Supreme Court to reverse the D.C. Circuit's September decision that ANCs aren't "Indian tribes" that qualify for relief under the relief legislation, with a decision expected to be issued by the high court within the next few weeks.

Representatives for the parties did not immediately return requests for comment.

The Prairie Band Potawatomi Nation is represented by Lippes Mathias Wexler Friedman LLP.

The Shawnee Tribe is represented by Quarles & Brady LLP.

The Miccosukee Tribe of Indians of Florida is represented by Alston & Bird LLP.

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

The cases are The Shawnee Tribe v. U.S. Department of the Treasury et al., case number 1:21-cv-00012; Prairie Band Potawatomi Nation v. U.S. Department of the Treasury et al., case number 1:20-cv-01999; and The Miccosukee Tribe of Indians of Florida v. U.S. Department of the Treasury et al., case number 1:20-cv-02792, all in the U.S. District Court for the District of Columbia.

--Additional reporting by Nadia Dreid and Melissa Angell. Editing by Nicole Bleier.

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