Limos. A rock band. Crab claws. Strippers. The night had all the ingredients for an epic bro-down.
On February 28, 2013, the limo swung by the Seminole Hard Rock Hotel & Casino to pick up five members of the '90s alt-rock band Candlebox. Along for the ride: Matt Iudice, their goateed manager. Chris Osceola, the stocky and handsome leader of the Seminole Tribe of Florida, was also onboard. Mobile Mike — a tanned radio personality whose wise-guy voice is familiar to listeners of Clear Channel radio stations across South Florida and who was then pocketing six figures a month to handle marketing for the tribe — was the captain of this particular night on the town.
First the men stuffed themselves with crab claws, oysters, and Grand Marnier at Joe's Stone Crab on Miami Beach. Then they made it to Scarlett's Cabaret, where colored lights stabbed out of the ceiling. Strippers flung themselves around the poles like deranged gymnasts. Vodka-soda empties cluttered the table. Osceola passed around Seminole-brand electronic cigarettes. More drinks were on the way.
"We walked in like we owned the place," Mobile Mike would recall later.
Witnesses say Osceola was in fan-boy heaven. He kept telling the musicians that Candlebox was his favorite act. But despite the outward display of nudie-bar bonhomie, the mood was off. The musicians were worrying over their bankroll.
For months, the band had been looking forward to a partnership that their manager had sketched out: The tribe — which owns the Hard Rock brand of resorts and casinos — would front $400,000 to finance Candlebox's 33-date 20th-anniversary tour, which would include shows at Hard Rock venues, for the coming summer. But the tribe had yet to hand over the money even though a deadline had come and gone.
The next day, the band prepared to play the Burgers and Beer Fest at the Seminole Hard Rock Hotel. Band members posed for grip-and-grin photos with Osceola and two other members of the Seminole tribal leadership before doing sound check at an outdoor stage. When they wrapped up, lead singer Kevin Martin and drummer Scott Mercado met with their manager and Osceola at the side of the stage. According to separate affidavits filed by Mercado and Iudice, Osceola promised their money would be coming that week. If not, Osceola said he'd open his own wallet to cover the deal.
"He shook my hand, looked me in the eye when he said it," Mercado says today. "I'll never forget it."
Later that night, a relieved Candlebox strode onto the stage and blasted through their set list. Martin, feeding off the crowd, seemed plugged into an electric socket. For part of the show, he pulled on a traditional Seminole patchwork jacket made of bright-orange, black, and red geometric patterns — a gift from the tribe. After the last notes had died and the crowd turned for the parking lot, Candlebox left, content that the band's financial future with the Seminoles was good.
But within a month, the deal was dead and buried. Candlebox was out of money. Its manager, Iudice, was out of a job. When he decided to take his gripes to court, his claims were quashed by a legal concept called sovereign immunity that makes governments — including Native American ones — immune from civil lawsuits.
Under U.S. law, sovereign governments — foreign nations, the U.S. government, individual American states, and, yes, Indian tribes — cannot be sued unless they waive this immunity or Congress acts. Most governments, however, aren't operating multibillion-dollar private businesses. The Seminole Tribe, in contrast, rakes in $2.2 billion annually just from gaming proceeds at its seven Florida casinos. It operates 21 Hard Rock hotels and ten casinos in locales from Vancouver to Punta Cana. In addition, the tribe owns businesses from energy drinks to e-cigarettes.
Untold numbers of partners have done business successfully with the tribe, and Florida residents benefit from the $132 million the tribe pays the state for enabling its gambling operations. But some who have tangled with tribes in business matters have found themselves headlocked in an inescapable losing position. Dozens of plaintiffs who had business disputes with the tribe say it has used its sovereign immunity to duck responsibility for broken contracts and shady deals — if it's not illegal, several plaintiffs complain, it's unethical.
Speaking specifically about three such cases examined by New Times, tribe spokesman Gary Bitner retorts: "As for pending litigation, the matters will be addressed by the court. For concluded litigation, the federal courts have correctly ruled in these matters, and the decisions speak for themselves. There has been no finding of wrongdoing against the tribe or the individual tribal members. All parties were treated fairly. The tribe has a longstanding history of long-term, mutually beneficial relationships with its business partners and vendors."
In an affidavit filed in federal court, another Seminole leader, Max Osceola, wrote that the tribe "endeavors" to explain its business practices to outsiders, but "while there is risk in virtually every business transaction, non-Indian parties doing business in Indian Country with federally recognized Indian tribes do so at their own peril."
This is a lesson that would be learned the hard way — and the expensive way — for Candlebox, for other businesses that faced broken deals with the Seminoles, and soon too for Mobile Mike.
It's a point of pride in Seminole history that the tribe has never backed down or flinched from conflict.
In the early 1800s, while white Americans were uprooting indigenous people all over the Southeast, a group of South Florida natives known as the Seminole — meaning "wild people" or "runaway" — ducked into the Florida Everglades to avoid the incursion. The U.S. Army still attempted to round up and displace these people, which led to the three bloody Seminole Wars. After the slaughter and forced relocation ceased in 1858, only about 300 natives were left in what would become Florida. The Seminole Tribe today likes to boast that it was never conquered or signed a treaty. For the next century, Indians lived as poor outcasts.
The Department of the Interior first set aside 540 acres in South Florida for indigenous people in 1907. By 1938, the number of Florida acres given to the native peoples had ballooned to 80,000, and three reservations had been established: Hollywood, Big Cypress, and Brighton. By 1957, some of the indigenous peoples chose to consolidate political power and organize officially as the Seminole Tribe. (Others organized separately as the Miccosukee Tribe or opted not to join either.) This group inked out a tribal constitution that set up a governing body, the five-member tribal council, as well as a corporate entity to handle its business matters — Seminole Tribe of Florida Inc.
There wasn't much to that business at first. "I remember when the tribe had $500 in the bank and the offices were a Quonset hut on the corner of Stirling Road and 441," says Bruce Rogow, a Fort Lauderdale-based attorney who has represented the tribe in the courtroom and also filed successful suits against the Seminoles. "Nobody was that eager to go into business with the tribe, because what did they have?"
Meanwhile, when the Founding Fathers were scratching their wigs over how to set up the government of what would become the United States of America, they borrowed some ideas from England — including sovereign immunity, a concept that stretches back to the royal courts of the 13th Century. "It comes from the idea that the king can do no wrong," explains Ryan Seelau, manager of the Indigenous Governance Programs at the University of Arizona's Native Nations Institute. "The king is divinely important, so you couldn't sue the king. It's the idea that the government cannot be sued or taken to court against its will." This immunity from lawsuits also ensures that governments are not sued into oblivion, their treasuries bled dry.
Although the concept of sovereign immunity wasn't expressly written into the Constitution, early U.S. Supreme Court decisions confirmed that the federal government couldn't be taken to court unless it consented. The 11th Amendment granted sovereign immunity to the states. By the early 1900s, Rogow explains, the same protection was extended to Indian tribes via U.S. Supreme Court decisions.
But, says Seelau, "generally speaking, the states and the federal government aren't running businesses." Indian governments, however, are now flush with cash from casinos, so sovereign immunity "plays out differently for tribes."
No one could have predicted the meteoric economic rise of the Seminoles.
Indigenous people had largely made their living off subsistence fishing and farming until the middle of the 1900s. In 1977, the tribe began selling tobacco products, which carried high taxes but could be sold tax-free on Indian lands.
Rogow explains how American and Indian laws intersect. If something is patently illegal under federal or state law, he says, it is likewise prohibited. But "if something was merely regulated by the state, you could do it on Indian land without regulation."
By the time the tribe began charging a state tax on tobacco in 2009, 25 million packs of cigarettes were reportedly being sold on Seminole lands annually.
But the real game-changer was gambling.
Rogow helped pioneer it. "People used to call me," he says. "They wanted to have cockfights on the reservation. You can't do it; it's illegal. But bingo was not illegal."
One of his clients proposed bingo without pot limits — prohibited in Florida — on Indian land. "That's how it all started," Rogow remembers.
The tribe opened its first bingo hall in 1979. Broward Sheriff Bob Butterworth challenged its right to exist. Rogow successfully argued otherwise and in 1981 won the case of Seminole Tribe v. Butterworth on appeal. This threw the doors open for gambling on reservation lands nationwide, and other tribes followed the Seminoles' lead in a casino-building boom. The Seminoles ultimately came to operate seven casinos and bingo halls in the state. Proceeds were shared with individual tribe members.
By 2006, the tribe had enough money in its coffers to purchase the Hard Rock chain of resorts and casinos for $965 million. In 2010, the tribe signed a compact with then-Gov. Charlie Crist giving it a monopoly to offer blackjack and table games at its seven Sunshine State locations for five years. In return, the tribe agreed to share 12.2 percent of its Florida gaming revenue — a number that last year was $132 million of the tribe's $2.2 billion total take-home. The compact will expire this July. Currently, the Seminoles are trying to extend this agreement with the state.
Meanwhile, the tribe has also aggressively diversified into other businesses, including e-cigarettes, cattle companies, and citrus groves. All of these businesses enjoy the protection of sovereign immunity.
Around the country, plaintiffs who have felt jilted in deals with tribes have filed lawsuits. Some cases have made it to the U.S. Supreme Court — which has always reaffirmed the tribes' rights to sovereign immunity.
Still, some of the justices' individual opinions "have taken serious question with the need for sovereign immunity now because it really is an unfair advantage to a tribe," Rogow says. "It's become more interesting because some of these tribes are so economically active, it raises the issue of: 'If they are just doing business like any business, should they be subject to the same rules?'?"
Rogow says any good lawyer would advise clients to make sure a tribe waives its sovereign immunity when it signs a contract. Tribal immunity, then, "is an unfair advantage only if you're not smart enough to get an express waiver."
Fanit Panofsky says she had enough work on her hands with her Contour Day Spa in Plantation and its 140 employees. But in the early 2000s, the Hard Rock's management approached the spa owner about opening a location at the Seminole's resort in Hollywood. "I don't know why they approached us," Panofsky says today. "But for 15 to 16 months, there was a back and forth. When they came to us, I definitely said no. But they were so persistent, I could not believe it. They said, 'You tell us what you want.'?"
She relented when they allowed Panofsky to set her own terms — a sweetheart 30-year lease with an annual rent of $210,000 for the two-story space. In 2003, she signed a lease that included a limited waiver of the tribe sovereign immunity, meaning the tribe was willing to go to court should a dispute break out between the parties.
The Contour at the Seminole Hard Rock opened in May 2004. Between construction costs, marketing, and tweaks over the first few years of business, Panofsky says she sank $2 million into the spa.
Documents show that disputes with the tribe began in 2005. Panofsky tangled with the Indians on matters from the cleanliness of the locker rooms to whether Hard Rock Hotel guests could use the spa's fitness center free of charge. Panofsky claims that in this period of time, the tribe offered to buy her out. She refused, further souring the relationship.
Then, in July 2007, Panofsky was invited to a sit-down meeting at which Hard Rock Hotel representatives informed the spa owner that her lease had never been properly approved by the Bureau of Indian Affairs (BIA), as required by Title 25 of the United State Code for any lease of Indian land longer than seven years. Basically, she'd been operating illegally for four years.
Panofsky called the BIA directly and was told that, indeed, in 2003, minor issues had been flagged in the lease; the bureau had sent the lease back to the Seminoles to tweak and resubmit. From there, it had languished.
Panofsky says she immediately tried to schedule meetings with Hard Rock CEO Jim Allen to resolve the lease issue. "I would come to his office with my water and my lunch and just sit," she says. "He would not see me."
The desperate Panofsky began caving to the Hard Rock's requests. "You have made it very clear to me and to my attorney that you want to get free access to the fitness center for hotel guests," she wrote to Jim Allen in February 2008. "Without this consent you are not going to resolve the lease issue... I have no choice but to agree to your new requests."
Good news is never on the other end of a 6 a.m. phone call. On March 18, 2010, Panofsky picked up an early-morning ring. One of Panofsky's employees frantically told her boss that Seminole Police officers were flanking the spa doors. The staff couldn't get inside. The spa was being evicted.
Panofsky went code-red, and within days, she filed a lawsuit against the tribe for wrongful eviction and unlawful entry and detention. Her lawyers argued that the tribe had purposely kept Panofsky in the dark about BIA's tweaks to the lease.
It was in this case that Max Osceola, a member of the tribal council at the time, wrote in an affidavit: "Without Secretarial approval, the lease is null and devoid and is of no force or effect." It was "void as though it never existed."
He noted that BIA had rejected the lease years earlier, but whether the spa had been informed of the rejection, he did not know. However, "nothing would have prevented such contact by Contour Spa to find out the status of the approval process." She should have done her due diligence, he contended. No one from the tribe had "done anything to impede, impair, or block" her ability to check on the status of the lease between 2004 and 2010.
In March 2011, federal Judge Robin Rosenbaum ruled that the tribe was correct: Because the BIA had never stamped approval on the lease, it — and the tribe's partial waiver of sovereign immunity contained therein — was invalid.
Ultimately, Panofsky lost not only the $2 mil she invested but $600,000 in lawyer's fees. She's still paying a loan for the construction work from ten years ago. To this day, she's livid — and she wants the world to know how the tribe used sovereign immunity to break a deal.
She said she thought of making a YouTube video inspired by the Islamic State beheadings. "I was going to put an orange suit on me and have somebody looking like an Indian with a big machete trying to cut my head off. And I want to put it viral. I tell you, it will get attention."
After a 20-year run, Candlebox members had ducked the usual Behind the Music potholes. They made it into their dad years as working musicians.
The band got its start in the late '80s, when two drummers bonded at a party in Seattle. A blond chatterbox named Kevin Martin met Scott Mercado, whose five-foot-six frame belied the damage he could do with a pair of drumsticks. The two kept running into each other, and when Martin dumped the drums for a lead-singer role, he asked Mercado to get behind the kit. Candlebox was born.
Thanks to the success of local grunge acts like Pearl Jam, Soundgarden, and Nirvana, record labels were constantly scouting in Seattle. Candlebox inked a deal with Madonna's Maverick Records. Their self-titled debut dropped in the summer of 1993, climbing as high as seven on the Billboard charts and eventually going quadruple platinum. The album contained the band's contribution to the grunge pantheon — "Far Behind," a song based around a catchy riff that blew up like the Hulk into an anthemic chorus — "Now ma-a-a-a-ybe I didn't mean to try you oh so bad/But I did it anyway." You'd be hard-pressed to find a Gen-Xer who can't hum the tune still today.
But the band never had the critical love or the punk-rock bona fides of its fellow scenesters. Subsequent albums had lukewarm sales, but Candlebox kept its engine going with constant touring. By 2012, the band was staring down the barrel at its 20th anniversary in 2013. "The band wasn't at the top of the charts, but the band has a very dedicated fan base," says manager Iudice, who had previously worked with Britney Spears.
For the anniversary, Iudice had an idea: hook the band up with a corporate sponsorship.
"In the '90s, bands would never get corporate sponsorships because it's like, 'You sold out — you're a slave to them,'?" Mercado says. "Now, I don't know a band that wouldn't want to, because the money that used to be there with other royalties isn't there. People aren't going to the store anymore to buy CDs."
Iudice had a connection with the Seminole Tribe after his wife had met members of the tribe at a Tampa cigar show. "The band was intrigued. I reached back out to the tribe, and they were interested. At that time, I found out that Candlebox was one of Chris Osceola's favorite bands. He acted like a 12-year-old when I first brought this to the table. It was interesting. You don't often hear someone say Candlebox is their favorite band of all time."
Iudice proposed a novel idea that would be a win-win: Typically, Candlebox would hire a booking agent to rent venues for a 40-night tour — earning the band anywhere from $12,500 to $20,000 a night. But if the band toured the Seminole's Hard Rock properties, the band would cut out the booking-agent fee.
Hard Rock venues would promote and advertise the shows; Mobile Mike would prepare radio spots for each tour spot; his marketing firm would wrap the band's tour bus with Seminole colors. For a 32-date tour in 2013, the Seminoles would pay the band $400,000.
In return, the band would buy back their last two albums from their record label and sign the rights over to the tribe. The Seminoles would then own the albums, which they could sell and distribute at the Candlebox shows as well as at Hard Rock locations. Essentially, they would be the band's record label. "With a brand like Hard Rock, they would be able to push and promote these two records and make good money off it," Iudice thought.
"This whole package should have been around $2 [million] or $3 million," Iudice admits. "Even though it was pocket change to the tribe, I wanted to minimize the risk so they could see this would work, and then do a $2 million tour down the line."
But the calendar flipped to 2013 without an inked deal. In January of that year, Iudice flew down to Florida to settle the particulars.
At a meeting at the Seminole Tribe's Hollywood headquarters, Iudice found himself at the negotiating table with Michael Ulizio, CFO of Seminole Tribe of Florida Inc.; and Mobile Mike, the tribe's in-house marketing guru.
According to an account outlined later in Iudice's affidavit, the two-hour meeting snagged when Ulizio floated an idea: The band should play the Seminole Hard Rock's upcoming Burgers and Beer Festival on March 1 to prove they could draw a crowd, but for only $7,500, half Candlebox's usual guaranteed fee. Iudice balked at the discount. Ulizio walked out of the room. Mobile Mike — then a loyal member of the Seminole team — urged the manager to cave.
When Ulizio returned, Iudice agreed as long as they drafted a letter of intent. This document specified that an investment of $400,000 from the tribe would finance the tour. The tribe would also get 60 percent of the merchandise and guarantees from the first leg of the tour; for the second leg, the same would be split 50/50. The letter outlined a February deadline for the first half of the payment.
Ulizio agreed and later signed the document.
"So, Mike, this does not need a board vote or any approval from Tony Sanchez or other representatives?" Iudice asked, according to his affidavit.
"I'm comfortable with the deal that we agreed on and the Board will accept my recommendation to move forward with this sponsorship," Ulizio said, according to Iudice's affidavit. "We're all set, tell everyone to relax and let's get this going and make some money."
In his own affidavit, Ulizio claimed to have told Iudice in an email: "I personally have no stake in this and merely complete the review and give my recommendations to the Board."
In February, the band played a sold-out show at the tribe-owned Hard Rock Boston. On February 28, the group flew down for the festival in Hollywood. Despite the trips to Joe's Stone Crab, Scarlett's, and assurances from Chris Osceola, the band still did not see the $400,000 in the first weeks of March.
By the end of the month, Candlebox fired Iudice. "The Tribe has made me jump through hoop after hoop and do a dance around everything, to give me nothing and leave us in debt," the manager wrote in an email to bandmates after his termination. "It's not ok with me and I intend to make it right."
The band, however, still needed the Seminoles. The touring over the past year had put it in the red financially. It desperately needed the $400,000 to cover its payments to staff and road crews. "[A]s much as I hate to say this but we may have to do this deal just to service our lives and debts," singer Martin wrote to the band that March. "I'm going over all the payables, etc and we are just so behind the 8 ball here that if we don't do it we are fucking over 20 relationships."
The band began negotiating directly with the tribe's attorney.
Then the band got another call from the Seminoles: no deal. The board of the Seminole Tribe of Florida, they were told, had voted down the arrangement 3-2. It was the first time the band learned the deal even needed a vote to move forward, Mercado says.
"The one thing they would keep telling us was that it was 'board approved,'?" he says. "All the time, we kept hearing it."
"After being repeatedly assured that this project had been approved and having been given absolutely no indications whatsoever that this deal (and the $400,000 payment) was ever in any form of jeopardy, we, in good faith, operated in reliance upon these assurances from you," Martin wrote in an email to the tribe. "Your sudden and unexpected turnaround has put this band... in a horrific position."
Today, Mercado remembers, "We were devastated. We basically became their bitches."
The band was so much in the hole, he says, that it couldn't afford to hire a lawyer to go after the tribe.
Iudice would try that himself. "I would not blow this off pal," he snapped out in an angry text message to Chris Osceola.
"Do not threaten me PAL!," Osceola texted back, according to screen grabs. "Your just another white guy who tried to take advantage of an Indian."
Iudice, via his company Lujen Brands, filed a federal lawsuit against the tribe in March 2014, alleging fraudulent misrepresentation and unjust enrichment, among other charges.
In October, a judged ruled there was no standing because of the tribe's sovereign immunity. The tribe immediately went after Iudice for sanctions for filing a frivolous suit. The two parties came to a settlement in December. Iudice says he did not have to pay the tribe.
The tribe — AKA STOFI — "did not pay Lujen any money under the terms of the agreement," tribe spokesman Gary Bitner says. "Further, Lujen and Candlebox agreed as part of the settlement that they would not disparage STOFI, and they should honor their agreement. This lawsuit is over."
The tribe's business activities allegedly even swung around on its own hype man — Mobile Mike. Sitting in his Dania Beach office, which is covered with snapshots from his 25 years as a radio personality, Mike recounts his relationship with the Seminoles.
He began his career as an intern at Power 96 and went on to host live events, promote concerts, and offer marketing services from radio ads to moving billboards and vehicle wraps.
"I have strategic partnerships with iHeartRadio and 100 other companies," he says. "With Mobile Mike, you are everywhere; you're on the streets 24 hours a day."
In late 2011, Chris Osceola pitched Mobile Mike on starting an "in-house" marketing agency with the tribe. The joint venture would be called MMMG.
"It was created to handle all the advertising and marketing for the tribe," says Mike. "They would have me back there instead of having seven different agencies. We were also going to start going outside the tribe as a global advertising agency. As a minority-owned business, we'd really be able to kill it."
By January 2012, the Seminoles and Mike had signed an operating agreement launching the company. Under the agreement, the tribe would receive 51 percent of the profit, Mike 49 percent. Mike was also elected as manager of the new company for at least ten years. His monthly compensation was $100,000.
"The $100,000 a month was because they wanted me exclusively; they didn't want me to go to Gulfstream or Calder," Mike says. "Everything I was going to do was around them."
According to Mobile Mike's testimony, however, certain members of the board chafed at the idea of a non-Seminole earning so much money from the tribe's businesses. One tribe member owned her own agency, called Redline Media. She was also the sister of a board member.
Just a year into his agreement with the tribe, Mobile Mike testified, tribal council member Larry Howard said that his sister "'was putting a lot of pressure on me. The election is coming, and if I don't figure out a way to kill your deal, I will not be supported by her, re-elected, and I will obviously lose my position on the board'... so he told me basically, 'I'm killing your deal.'?"
Mike says the tribe first convinced him to go through a "sham" process of submitting a bid to serve as the advertising agency, but eventually, it stopped paying him.
Through his company MMMG, he filed a $250 million lawsuit against the Seminole Tribe as well as individuals including Sanchez, Howard, Ulizio, and Chris Osceola. The complaint alleges breach of contract, tortious interference, fraud, and civil RICO, among others. It says they "engaged in a carefully planned, orchestrated, intricate, multistep, sinister, and devious course of action" to oust him. Their purpose was "nefarious" and "contumacious," he alleged.
On October 2014, during a colorful four-day hearing in Broward Circuit Court, testimony focused on whether the tribe had waived its sovereign immunity in the contract with MMMG. Mobile Mike produced a version of the operating agreement with a waiver. The tribe's version had no such waiver. Expert digital document technicians testified for the tribe that the former version may have been forged by Mobile Mike.
In October, a judge ruled that — again — the tribe's sovereign immunity protects it from Mobile Mike's complaint. However, the judge green-lit the lawsuit against the individual members named in the suit but dismissed six of the nine counts.
If you like this story, consider signing up for our email newsletters.
SHOW ME HOW
You have successfully signed up for your selected newsletter(s) - please keep an eye on your mailbox, we're movin' in!
"No part of the trial court's ruling found any wrongdoing by STOFI or its board of directors," tribe spokesman Bitner says. "STOFI's attorneys have appealed the portions of the ruling concerning the three counts remaining against individual defendants, which the trial court addressed only on procedural grounds not reaching the merits of the claims."
Today, the tribe has a bigger issue on its hands — trying to extend the compact that grants it exclusive rights to offer table gaming. Bitner reasserted the tribe's right to fend off legal challenges: "Like other sovereigns, the Seminole Tribe of Florida (and STOFI as a subordinate economic entity of the Seminole Tribe) has immunity from suit. The immunity from suit is part of sovereignty and self-governance for Indian tribes, just as it is for other governmental entities."
Candlebox is currently on ice. According to Mercado, the band's financial situation has made touring difficult. A group of loyal Candlebox fans, however, has started a "Boycott the Hard Rock" Facebook group. The page has more than 23,000 likes.
Mobile Mike counts the court's decision to move forward with his claims against individual tribe members as a victory. But his fight with the Seminoles has also cost him work. "These motherfuckers," he says, wrapping his own hands around his tan neck, "are killing my business."