In United States v. Sioux Nation of Indians, the Supreme Court ruled in 1980 that the federal government’s 1877 seizure of the Black Hills from the Sioux Nation was an unconstitutional taking under the Fifth Amendment and ordered the government to pay $17.1 million plus interest running back to the date of the taking. The award, swelled by more than a century of five percent annual interest, has never been touched. The Sioux have refused every dollar because accepting the money would legally close out their claim to the land, and the land is what they want back.
What the Government Took in 1877
The 1868 Treaty of Fort Laramie set aside the Great Sioux Reservation, including the Black Hills, “for the absolute and undisturbed use and occupation” of the Sioux.1National Archives. Treaty of Fort Laramie (1868) Article 12 of that treaty said no future cession of any part of the reservation would be valid unless signed by at least three-fourths of the adult male Sioux.2The Avalon Project. Fort Laramie Treaty, 1868 That supermajority requirement was the treaty’s central protection against a coerced land deal.
Gold changed everything. After Custer’s 1874 expedition confirmed deposits in the Black Hills, prospectors poured in and the Army stopped keeping them out. Following the Great Sioux War of 1876, Congress attached a “sell or starve” rider to an appropriations bill: no more subsistence funds for the Sioux unless they surrendered the Black Hills. A commission led by George Manypenny went out to obtain signatures and collected roughly ten percent of the eligible adult male population, nowhere near the three-fourths the treaty required. Congress then enacted the arrangement as the Act of February 28, 1877, stripping more than seven million acres including the entire Black Hills.3Justia. United States v. Sioux Nation of Indians In exchange, the government offered rations of beef, flour, corn, coffee, sugar, and beans, conditioned on children attending government schools and adults taking up farming.4GovTrack. Act of February 28, 1877 (19 Stat. 254)
How the Case Reached the Supreme Court
The Sioux had no legal path to challenge the seizure until 1920, when Congress passed a special jurisdictional act permitting them to sue in the Court of Claims. That first round ended in 1942 with a dismissal on the ground that the 1920 Act did not authorize the court to examine whether the 1877 compensation was adequate.3Justia. United States v. Sioux Nation of Indians
After Congress created the Indian Claims Commission in 1946, the Sioux tried again. The Commission agreed that the 1877 Act was a taking, and the Court of Claims awarded at least $17.5 million without interest, but then held that the constitutional taking claim itself was barred by the 1942 decision. To break the deadlock, Congress passed legislation in 1978 directing the Court of Claims to review the taking question fresh, without regard to the earlier dismissal. The court did so, affirmed the taking, and the government appealed to the Supreme Court.3Justia. United States v. Sioux Nation of Indians
The Good Faith Effort Test
The central legal question was whether the 1877 Act was Congress acting as trustee over tribal property or Congress exercising eminent domain. A trustee may convert tribal land into other assets, such as money, as long as the exchange is fair. If it isn’t, the transaction is a taking that requires just compensation under the Fifth Amendment.
The Court applied what it called the “good faith effort” test, drawn from an earlier Fort Berthold Reservation case. The question was not whether the exchange proved perfectly equivalent in hindsight, but whether Congress made a genuine attempt to give the tribe the full value of the land at the time.3Justia. United States v. Sioux Nation of Indians
Applied to the record, the answer was clear. The only thing that could count as compensation was the ration promise, and no one on the Manypenny Commission, in the relevant congressional committees, or on the floor of Congress ever claimed the rations were a fair price for the Black Hills. The conditions attached to the rations, requiring school attendance and farming, revealed a purpose of reshaping Sioux life rather than paying for seized land. The 1877 Act failed the test.3Justia. United States v. Sioux Nation of Indians
The 8–1 Ruling and the Award
Justice Harry Blackmun wrote for an eight-Justice majority holding that the 1877 Act was a Fifth Amendment taking. The Court set compensation at $17.1 million, the fair market value of the Black Hills in 1877, and ordered five percent annual interest from the date of the taking, a period that already stretched 103 years by the time of the decision. Blackmun wrote that “a more ripe and rank case of dishonorable dealings will never, in all probability, be found in our history.”3Justia. United States v. Sioux Nation of Indians
Justice William Rehnquist dissented alone. He argued that Congress had overstepped by ordering a new trial in an already-decided case, performing what he saw as a judicial function. He also objected to the majority’s reading of the historical record, writing that “the Indians did not lack their share of villainy” and that it was “quite unfair to judge by the light of ‘revisionist’ historians or the mores of another era actions that were taken under pressure of time more than a century ago.”3Justia. United States v. Sioux Nation of Indians
Why the Sioux Won’t Take the Money
The compensation was placed into an interest-bearing trust account at the Department of the Treasury. The Sioux have not withdrawn any of it. By 2011 the fund had grown to roughly $1 billion, and it has continued to accrue interest since.
The refusal is a legal strategy as much as a moral position. Accepting the payment would function as a completed sale and extinguish the Sioux claim to the Black Hills. For the Lakota, the hills, known as Paha Sapa, are the center of the world and the site of ceremonies, vision quests, and the Sun Dance. From their perspective, the Fifth Amendment framework treats the dispute as a real estate transaction, when what the government took was sovereignty and sacred geography under a treaty it broke by force. The money would settle the wrong question.
Legislative efforts to return land rather than pay for it have not succeeded. In 1987, Senator Bill Bradley introduced the Sioux Nation Black Hills Act, which would have returned federal lands in the Black Hills to the Sioux and given them first refusal on privately held parcels within the area.5Congress.gov. S.705 – Sioux Nation Black Hills Act The bill did not pass. Nothing since has closed the gap between what the Supreme Court awarded and what the Sioux have always said they want. The trust fund keeps growing. The dispute remains where it stood in 1877.