A California bankruptcy case involving an American Indian enterprise could have repercussions in Oklahoma.
The Santa Ysabel Resort and Casino near San Diego is seeking to enter into Chapter 11 bankruptcy. American Indian tribes are considered sovereign nations and not included among entities that can file Chapter 11 under existing law, but they are not specifically excluded, either.
Case law is virtually nonexistent. A tribal enterprise in Minnesota filed for Chapter 11 protection in 2008, but that business wasn’t located on tribal land. The mere possibility that tribal-owned businesses could file for bankruptcy has caused banks to restructure $1.7 billion in debt owed by tribes, according to a recent Fitch Ratings report.
In addition to non-gambling tribal businesses, there are well over 100 casinos in Oklahoma that are tribal-owned entities on Indian land, so the outcome of the California case could have ripple effects across the Sooner State.