A federal judge ruled Friday that the U.S. District Court, Eastern District of California, has jurisdiction over a lawsuit filed in March by the Paskenta Band of Nomlaki Indians against former tribal officials and senior employees accused of defrauding the tribe of tens of millions of dollars.
The court rejected claims by defendants that the lawsuit, filed under the federal Racketeer Influence and Corruption (RICO) Act and other state and federal laws, is an intra-tribal dispute and therefore the court had no jurisdiction to hear any of the tribe’s claims.
“We are gratified by the court’s decision,” said the Tribal Council in a statement. “The tribe brought this action to hold responsible a group of individuals who, for well over a decade, conspired to steal tens of millions of dollars from the tribe.”
The tribe owns and operates Rolling Hills Casino just off of Interstate 5 near Corning.
The lawsuit comes after four members of the Tribal Council were ousted by tribal membership in April 2014, which culminated in a prolonged armed standoff at the casino in June 2014, the destruction of computer records and the disappearance of a private jet owned by the tribe.
The suit names defendants Leslie Lohse, the tribe’s former treasurer; Larry Lohse, the former tribal environmental director; John Crosby, the tribe’s former economic development director; and Ines Crosby, the former tribal administrator, among 15 other defendants.
Subsequently, the two factions came to an agreement to hold an election in September 2014 “to allow the members of the tribe to determine the tribe’s governing body,” according to a July 2014 Daily News article. The election resulted in the tribe siding against the ousted members.
Judge Garland Burrell Jr. also denied the defendants’ attempt to dismiss the tribe’s restitution claims, including those filed against banks, retirement funds and a gold and silver broker, which conducted business with the ousted members during the period the alleged theft of funds took place.
“The court’s decision affirms the tribe’s ability to pursue claims against all of the 20-plus named defendants,” said the tribe’s co-counsel Andrew Purdy.
The court dismissed claims against the businesses but suggested amended claims could be filed in some cases.