U.S. District Court Rules in Favor of Native American Church Chapter, Denying Bank’s Efforts to Dismiss Discrimination Case

Leaders of the Native American Church of North American convene in Washington, D.C., on September 23, 2023 to advocate for protections of their way of life and the natural habitat of peyote with federal agencies and Congressional leaders. Photo by Darren Thompson

By Darren Thompson

Madison, Wisconsin—A discrimination case stemming from the Lac du Flambeau Indian Reservation gained momentum this week after a U.S. District Court denied the defendant’s motion to dismiss. Plaintiff Mashkikii-Boodawaaning Inc., “Medicine Fireplace” in the Ojibwe language, is an affiliated chapter of the Native American Church of North America (NACNA) and claimed that defendant Chippewa Valley Agency, Ltd., doing business as Chippewa Valley Bank, denied their application to open a commercial banking account because the organization is affiliated with the use of peyote.

On Tuesday, April 16, U.S. District Judge William M. Conley issued a 9-page order and opinion denying a motion to dismiss by the defendant, while also stating that plaintiff Medicine Fireplace adequately alleged that the bank intentionally discriminated against them in an attempt to open a commercial bank account because of its use of peyote.

“Defendant Chippewa Valley Agency, Ltd. (d/b/a Chippewa Valley Bank) has moved to dismiss, which the court will deny as Medicine Fireplace has adequately alleged that the bank intentionally discriminated against it because of race and creed,” wrote U.S. District Judge William M. Conley in a 9-page order and opinion published on Tuesday, April 16.

Judge Conley cited the American Indian Religious Freedom Act’s (AIRFA) 1994 Amendment in his denial, and said that the use of peyote in conjunction with traditional American Indian religion is lawful. “The use of peyote for bona fide Native American religious ceremonies is also lawful under Wisconsin state law,” Conley stated.

AIRFA's 1994 Amendment passed in Congress and permitted enrolled members of federally recognized tribes to possess, transport, and ingest peyote in bona fide traditional American Indian ceremonies. Since the 1994 Amendment was passed, 30 years ago, NACNA leaders say there is little enforcement of the law and the plant’s future is threatened by development and non-Native efforts to legalize mescaline, the active hallucinogenic ingredient in peyote. While the Amendment protects the traditional use of the plant in ceremonies, it does not protect the plant’s natural environment, which only grows on private lands in four southern counties in Texas.

In March 2022, Charles Carufel, an enrolled Lac du Flambeau Ojibwe citizen, applied for a commercial checking account on behalf of Medicine Fireplace at Chippewa Valley Bank’s Lac du Flambeau location and was denied. The bank’s branch manager denied Medicine Fireplace’s application and explained that the bank’s denial was strictly because of peyote.

After the initial denial, Carufel spoke with the bank supervisor and explained the organization’s religious nature and its protected used of peyote in traditional ceremonies. According to court documents, the bank supervisor, who is not a tribal citizen, reiterated that the denial was because of the organization’s peyote use while also denying the religious significance and legality of the plant.

The plaintiff is asking for an injunctive relief to allow Medicine Fireplace to open a commercial checking account and to cease all forms of discrimination against Native Americans.

The defendant filed a motion to dismiss on several grounds, saying that because the bank has many Native American customers, including a general account for the Lac du Flambeau Band of Lake Superior Chippewa Indians, it does not discriminate against Native Americans. The defendant also errored in stating that peyote use is not synonymous with Native American identity, and the denial was because peyote is illegal in Wisconsin.

Judge Conley disagreed and wrote, “As for its claim that defendant denied it a bank account for lawfully using peyote in particular, plaintiff argues that the ‘fit’ between Native American race and sacramental peyote use is ‘identical,’ since the sacramental use of peyote is inextricably linked to Native American race.”

In other words, the court acknowledges that peyote use is synonymous with Native American identity and that the bank’s denial based on peyote use is discriminating against Native Americans. The Court also stated that the plaintiff makes a strong argument that besides its Native American racial identity, the bank would have allowed Medicine Fireplace to open a commercial checking account.

Conley also wrote that the plaintiff adequately presented a religious discrimination claim based on the the bank’s reasoning for the denial was because of the use of peyote, and, therefore, denying the religious significance of peyote use. Because the use of peyote is only permitted by enrolled members of federally recognized tribes in traditional American Indian religions, denying services based on peyote use is discriminating against Native Americans as a race and their creed.

The next court session is a telephonic status conference scheduled for April 30, 2024 at 1:30 p.m. central time.

This is a developing story and will be updated if counsel for Mashkikii-Boodawaaning Inc. provides a comment.