(CN) - Operators of a Nevada power plant can sue Navajo officials to block a lawsuit in the tribal courts, the 9th Circuit ruled Thursday.
The dispute stems from the firing of two employees, both tribal members, at the Navajo Generating Station on the Navajo reservation land in northern Arizona.
After they were fired, the workers filed complaints with the Navajo Labor Commission against Salt River Project Agricultural Improvement and Power District and Headwaters Resources Inc., which own and operate the plant, respectively.
The workers say that Salt River and Headwaters fired them without just cause in violation of the Navajo Preference in Employment Act.
Though the plant operators argued that the Navajo Nation had no authority to regulate employment issues at the plant under the 1969 lease, the Navajo Nation Supreme Court let the case proceed.
Salt River and Headwaters then filed a federal complaint against the director of the Office of Navajo Labor Relations, members of the Navajo Nation Labor Commission and the justices of the Navajo Nation Supreme Court.
The suit seeks an injunction to block the tribal case. A federal judge in Phoenix dismissed the case, however, after finding that the Navajo Nation was a necessary party but could not be sued because of sovereign immunity.
On Thursday, the federal appeals court in San Francisco found otherwise and remanded the case to Phoenix. The Navajo Nation itself is not a necessary party because the officials can represent the tribe's interest, the judges found.
"Here, the Navajo official defendants can be expected to adequately represent the Navajo Nation's interests," Judge Barry Silverman wrote for a three-judge panel. "First, the officials' interests are aligned with the tribe's interests: The officials are responsible for enforcing the Navajo Preference in Employment Act, and there is no suggestion that the officials' attempt to enforce the statute here is antithetical to the tribe's interests. Second, there is no reason to believe the Navajo official defendants cannot or will not make any reasonable argument that the tribe would make if it were a party. Third, there is no indication that the tribe would offer any necessary element to the action that the Navajo official defendants would neglect."
To hold otherwise, the judges found, would "effectively gut the Ex parte Young doctrine," which governs nonmonetary injunctive actions against state and tribal officials.