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Grand Canyon Skywalk

Hualapai Claim Victory in Latest Skywalk Court Round

Anne Minard
5/21/13

 

In ongoing court battles over the right to manage the world-famous Grand Canyon Skywalk, the Hualapai Tribe claims victory in the latest round.  But it’s still an open question whether the tribe, or the developer who footed the bill, will ultimately prevail.

The Skywalk is a horseshoe-shaped, glass-bottom structure that juts 70 feet from the edge of the Grand Canyon, allowing visitors to stand 4,000 feet above the Colorado River. Nevada Developer David Jin and the tribe signed a contract in 2003, wherein Jin would put up the $30 million in capital to build the Skywalk, then recoup his costs over several decades from the venture’s profits. In a case settled last year, Jin successfully sued the tribe’s development corporation, Sa' Nyu Wa, Inc., for years of management fees totaling $28.6 million that weren’t paid to him as agreed between 2007 and 2011. Following that verdict, Sa' Nyu Wa declared bankruptcy; those proceedings are ongoing. (Related story: Grand Canyon Skywalk Operator Wages Legal Battle with Hualapai Tribe of Arizona)

In a more recent dispute, the tribe itself is attempting to oust Jin from his managerial role by paying him off. As its primary reason, the tribe alleges that Jin has neglected obligations including the completion of a visitors’ center – but Jin says the tribe never provided the agreed-upon utilities that would have allowed him to build it.

The tribe is claiming victory because of an April 26 ruling out of the 9th Circuit Court of Appeals, in which the court denied Jin’s request to move his case out of the Hualapai tribal court system and into federal court.

“Affirming the district court’s judgment … the panel held that the Nevada corporation must exhaust tribal court remedies before proceeding in federal court on its claims challenging the tribe’s authority to condemn its intangible property rights in the contract,” the judges wrote.

Tribal government officials declined to comment on the ongoing litigation. But tribal spokesman Dave Cieslak called the appeals court ruling “a significant victory for the Hualapai people and for tribal sovereignty,” adding that “the 9th Circuit's ruling shows deference to the tribal court system and its jurisdiction over these matters."

Jin’s attorney, Mark Tratos, downplayed the significance of the appeals court ruling, saying it came too late to have any bearing on the case; tribal court judge Lawrence King had already ruled, on March 5, that arbitration in federal court would be the proper next step for figuring out how much the tribe would have to pay Jin for the rights to take over the Skywalk. King put the tribal case on hold pending the outcome of that arbitration.

“We believe that the arbitration will result in a very large award,” Tratos said, adding that it’s likely to be on the high side of the space between the tribe’s valuation at $11 million and his, at $277 million.

“If they can’t pay it, they have to give us our rights back,” he said.

Cieslak believes it’s time for Jin to back down.

“We are continuing to hope that Mr. Jin stops his disparagement of the Hualapai people and accepts fair-market value for the Skywalk contract,” he said. “This has always been an issue of fairness – about right and wrong. Mr. Jin failed to uphold his end of the bargain and honor the terms of his contract.”

Meanwhile, the Skywalk continues to command healthy profits, with more than two million visitors to date.

“We celebrated a one-day attendance record in December, with more than 5,200 people visiting Grand Canyon West,” Cieslak said, referring to the Hualapai tourism destination as a whole, which includes the Skywalk. “The revenues from the tribe's tourism operations are vital to the Hualapai people. They provide a lifeline for the approximately 1,300 people who live on the reservation.”

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