Native American Arts, Inc. v. Bundy-Howard, Inc.

168 F. Supp. 2d 905, 2001 U.S. Dist. LEXIS 16850, 2001 WL 1246376
CourtDistrict Court, N.D. Illinois
DecidedOctober 15, 2001
Docket01 C 1618
StatusPublished
Cited by7 cases

This text of 168 F. Supp. 2d 905 (Native American Arts, Inc. v. Bundy-Howard, Inc.) is published on Counsel Stack Legal Research, covering District Court, N.D. Illinois primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Native American Arts, Inc. v. Bundy-Howard, Inc., 168 F. Supp. 2d 905, 2001 U.S. Dist. LEXIS 16850, 2001 WL 1246376 (N.D. Ill. 2001).

Opinion

MEMORANDUM OPINION AND ORDER

SHADUR, Senior District Judge.

Native American Arts, Inc. (“Native American”) has filed a six-count Complaint against numerous defendants, alleging violations of the Indian Arts and Crafts Act (the “Act,” 25 U.S.C. 305e 1 ). Defendants Bundy-Howard, Inc. d/b/a Bear Tracks (“Bear Tracks”) and 9-Mile Creek Traders (collectively “Movants”) now move for judgment on the pleadings pursuant to Fed.R.Civ.P. (“Rule”) 12(c), arguing that the Act is unconstitutional. For the reasons set forth in this opinion, the motion is denied.

Judgment on the pleadings in favor of a defendant is appropriate when defendant clearly establishes that plaintiff cannot prove any set of facts that would support the claim for relief and that there are no material issues of fact to be resolved (Northern Ind. Gun & Outdoor Shows, Inc. v. City of South Bend, 163 F.3d 449, 452 (7th Cir.1998)). In considering such a motion the court must accept as true all facts alleged by plaintiff and must draw all reasonable inferences from the pleadings in plaintiffs favor (id.; Gillman v. Burlington N.R.R., 878 F.2d 1020, 1022 (7th Cir.1989)), though the court is not bound to accept defendant’s legal characterization of the facts (Scott v. O’Grady, 975 F.2d 366, 368 (7th Cir.1992)). Hence this opinion’s factual recital is drawn from Native American’s Amended Complaint (cited “Count_¶_”), and it omits “Native American alleges” or any like usage (without of course making or implying any factual findings). 2

Background

Native American is an Indian arts and crafts organization within the meaning of the Act. 3 It is wholly Indian-owned, and it *909 distributes authentic Indian arts and crafts (Count I ¶ 3). Bear Tracks is a corporation operating retail establishments in the Northern District of Illinois that sell arts, crafts and jewelry (Count I ¶ 4). 9-Mile Creek Traders is a wholesaler and manufacturer of Indian art and jewelry (Count I ¶ 11).

Bear Tracks and 9-Mile Creek Traders violated the Act by offering, displaying for sale and selling art, crafts and jewelry in a manner that falsely suggests the goods were Indian-made (Count I ¶¶ 18, 25, 29-38). Section 305e(a) prohibits:

directly or indirectly, offer[ing] or displaying] for sale or selling] a good, with or without a Government trademark, in a manner that falsely suggests it is Indian produced, an Indian product, or the product of a particular Indian or Indian tribe or Indian arts and crafts organization, resident within the United States....

Several of the terms in that subsection have statutory definitions. Thus Section 305e(d)(l) says an “Indian” is “a member of an Indian tribe” or a person “certified as an Indian artisan by an Indian tribe.” While “Indian product” is not defined in the statute, Section 305a(d)(2) says the term is to be defined in regulations promulgated by the Secretary of the Interior. Sections 305 through 305d vest power in the Indian Arts and Crafts Board (“Board”), an Interior Department agency, to enforce much of the Act — and Section 305b specifies “[t]hat all rules and regulations proposed by the Board shall be submitted to the Secretary of the Interior and shall become effective upon his approval.” 4 In turn the Board has defined “Indian product” as “any art or craft product made by an Indian” (Reg. § 309.2(d)). Under Sections- 305e(a) and (b) plaintiffs may recover the greater of treble damages or $1,000 per day for each day that the offending product is offered for sale or sold, as well as punitive damages and attorney’s fees.

Constitutionality of the Act

In support of their motion for judgment on the pleadings, Movants contend that the Act is unconstitutional because (1) it violates procedural due process, (2) it also violates substantive due process and (3) Board’s regulations exceed the scope of its authority. Those arguments will be addressed in turn.

Procedural Due Process Challenge

Movants’ procedural due process attack has two prongs: first, various provisions assertedly fail to provide fair notice to putative defendants, and second, there is assertedly no standard for application of the punitive damages and attorney’s fees provision. Because the Act provides adequate notice of what is prohibited by the statute and provides adequate standards for non-arbitrary. enforcement, both challenges are rejected.

1. Voidrfor-Vagueness Doctrine

Under the void-for-vagueness doctrine, a law is unconstitutional “if its prohibitions are not clearly defined” (Karlin v. Foust, 188 F.3d 446, 458 (7th Cir.1999), quoting Grayned v. City of Rockford, 408 U.S. 104, 108, 92 S.Ct. 2294, 33 L.Ed.2d 222 (1972)). There are two parts of the vagueness test: Laws must “give the person of ordinary intelligence a reasonable opportunity to know what is prohibited,” and they must contain “explicit standards” to avoid “arbitrary and discriminatory enforcement” (Grayned, 408 U.S. at 108-09, 92 S.Ct. 2294; Karlin, 188 *910 F.3d at 458-59). What level of vagueness is constitutionally tolerable depends on a congeries of factors — and in this case those factors not only counsel in favor of tolerating some imprecision in the statute but also compel the rejection of Movants’ position even apart from any generous construction of the language employed.

First, economic regulations are subject to a less stringent vagueness test than laws that inhibit the noncommercial exercise of constitutionally protected rights (Village of Hoffman Estates v. Flipside, Hoffman Estates, Inc., 455 U.S. 489, 498-99, 102 S.Ct. 1186, 71 L.Ed.2d 362 (1982)). Here the parties agree that the Act impacts commercial speech (M.Mem.5), and although such commercial speech is also protected by the First Amendment (Virginia State Bd. of Pharmacy v. Virginia Citizens Consumer Council, Inc., 425 U.S. 748, 762, 96 S.Ct. 1817, 48 L.Ed.2d 346 (1976)), the fact that such protection is grounded in providing the public with truthful and accurate information deprives commercial speech that is deceitful, misleading or fraudulent of such protection (Central Hudson Gas & Elec. Corp. v. Public Serv. Comm’n of N.Y., 447 U.S. 557, 561-64, 100 S.Ct. 2343, 65 L.Ed.2d 341 (1980); United States v. Raymond, 228 F.3d 804, 815-16 (7th Cir.2000)).

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Bluebook (online)
168 F. Supp. 2d 905, 2001 U.S. Dist. LEXIS 16850, 2001 WL 1246376, Counsel Stack Legal Research, https://law.counselstack.com/opinion/native-american-arts-inc-v-bundy-howard-inc-ilnd-2001.