A visiting superior court judge has denied a motion to dismiss a lawsuit against the Occaneechi Band of the Saponi Nation, a Native American tribe based primarily in the Pleasant Grove community in eastern Alamance County but whose members also include residents of other nearby counties.
Judge Sean Cole of Wake County announced following a hearing in Alamance County civil superior court on Monday afternoon that “there appear to be a number of failings” in the defendants’ argument that the suit should be dismissed under the North Carolina Business Corporation Act (the “business judgment rule”).
Cole’s denial of the motion to dismiss marks the defendants’ – the Occaneechi Band of the Saponi Nation (OBSN) and tribal chairman Tony Hayes – second attempt to avoid what could evolve into a lengthy court battle.
The plaintiff, Crystal Cavalier of Mebane, filed suit earlier this year against the tribe, of which she has been an “enrolled member” since 2008, for allegedly violating its own constitution and bylaws last year by voting to expand the criteria for membership.
The OBSN has countered in its response and earlier court filings that the tribe likely would’ve faded into extinction because of the previous “restrictive requirements” for membership.
The original constitution and bylaws originally required prospective members to have “a grandparent living in the traditional Occaneechi community of Orange, Alamance, and Caswell counties,” according to the attorney for the defendants, John D. Loftin of Hillsborough.
The OBSN became the eighth officially recognized tribe in the state of North Carolina in 2002, according to the state Department of Natural and Cultural Resources, and has an office at 4902 Dailey Store Road in Burlington.
A different visiting superior court judge, Matthew B. Smith of Union County, denied the defendants’ earlier motion to dismiss on grounds of sovereign immunity following a hearing in superior court this spring.
Loftin contended that a 2009 opinion by the state Court of Appeals, in Meherrin Indian Tribe v. Lewis “leaves open that state recognized tribes [including the OBSN] enjoy immunity over some disputes,” according to his first motion to dismiss.
Smith also denied Cavalier’s request for a preliminary injunction – declaring the 2024 amendment to the tribe’s constitution as legally invalid – following the hearing in Alamance County superior court on May 5, 2025. The visiting judge concluded that the plaintiff had failed to prove she would suffer irreparable harm unless an injunction was granted, according to Smith’s order.
Outlining the basis for his second motion to dismiss, Loftin argued that the “business judgment rule” protects members of a nonprofit corporation, such as the OSBN tribal council, from being held personally liable for decisions made on behalf of the corporation and presumes that directors acted with “due care and good faith in the honest belief” that their actions had been in the best interest of the corporation.
Loftin pointed in his motion to dismiss under the business judgment rule that earlier rulings by the state Court of Appeals and N.C. Business Court had established that “mere dissatisfaction with board decisions, absent allegations of fraud, conversion, or mismanagement of assets, is insufficient to overcome the presumption of the business judgment rule.”
“The plaintiff does not allege and there is no evidence of fraud, conversion, or mismanagement of money,” the defendants’ attorney asserted in the motion to dismiss that Cole, the visiting superior court judge from Wake County, heard on Monday.
Loftin insisted, both in his motion and during the hearing in superior court on Monday afternoon, that the “entire and sole” purpose for the amendment was so that the OBSN would not “self-terminate” as members have migrated away from the traditional Occaneechi community in search of employment. “Otherwise eligible members may very well not have a grandparent living in the traditional community areas,” according to the defendants’ second motion to dismiss the lawsuit.
“That was done in good faith after many months of meeting with the Tribal Council and after a special election,” Loftin wrote in his motion to dismiss under the business judgment rule. “No Occaneechi member should fight such a positive change in the name of form over substance regarding North Carolina non-profit corporate law, and that is what [the] Plaintiff seeks to do.”
“Cases like this can go on ad nauseum and [the] plaintiff would like nothing better.” Loftin opined in his motion to dismiss under the business judgment rule. “If [she] is unhappy with the Tribe’s action, [the] plaintiff may object the right way and run for office or support other candidates. In fact, she was once a Tribal council member and resigned.”
In her original suit, Cavalier acknowledged that she had served as one of five members of the tribal council for the OBSN from June 2017 until November 2018. She also ran in the May 2022 Democratic primary for the 4th congressional district – which at the time included Alamance, Durham, Granville, Orange, and Person counties, as well as part of Caswell County – but lost to Valerie Foushee, a Democratic former state house representative and state senator now serving her first term in the U.S. House.
Plaintiff’s attorney: Tribal government ‘basically usurped’ by defendants
Cavalier’s attorney, C. Scott Holmes of Durham, filed a memorandum opposing dismissal on alleged grounds that Hayes had exceeded the scope of his legal authority as tribal chairman as defined by the 2001 constitution and bylaws.
During the hearing in superior court judge, Holmes again alleged that the nonprofit corporation under which the tribe is organized “has operated outside its authority by having no annual meetings almost 10 years.” He further alleged that Cavalier has not been allowed to participate in her tribe “in the manner in which it was formed,” as oversight of the tribe has been “basically usurped by Mr. Hayes” and a handful of council members, whom Holmes argued were not properly elected.
Holmes repeatedly pointed out during the hearing on Monday afternoon that no tribal elections – either for the chairman or council – had been held since 2016. The plaintiff is seeking a judgment declaring the defendants’ actions, in particular the 2024 amendment, legally invalid and unenforceable and requiring a new election of the “entire Executive and Tribal Councils” of the OBSN.
The constitution and 2001 bylaws require the OBSN to: hold an annual meeting and vote to elect a tribal chairman and council; fill vacancies on the council (which currently has about half of the 12 members required under the 2001 constitution and bylaws); and to appoint a finance committee, develop an annual budget, and hire an independent certified accountant to conduct an annual audit of its finances, according to the plaintiff’s memorandum.
Loftin countered that the tribal council had another meeting” just last week and has discussed holding another election during the first quarter of 2026.
However, the defendants’ attorney contended that, the last time an election of officers was held, the tribe “had to go out and beat the bushes” to get its members to participate.
“Tribal councils do amend bylaws and constitutions,” Loftin told Cole during the hearing. To say that the tribe and its chairman, Hayes, had done so with without legal authority is “not valid,” Loftin told the visiting judge, Cole. “They’re using the law as a sword and not a shield,” and this case should be dismissed, the defendants’ attorney said, referring to the plaintiff and a handful of supporters who were seated in the courtroom gallery Monday afternoon.
Cavalier alleges that the process used in 2024 to amend the constitution – thereby expanding its membership – had violated the 2001 constitution and bylaws because members hadn’t been notified by mail, and the subsequent vote was conducted via email. That process resulted in the adoption of “an illegitimate amended constitution,” according to the plaintiff’s memo opposing dismissal under the business judgment rule.
Cavalier also claims that Hayes has violated a prohibition on holding office for more than three consecutive terms, according to her second amended complaint, which doesn’t appear to specify the length of terms for officers.
Prior to ratifying the 2024 amendment, 91 eligible voting members of the tribe were verified, and all 91 voting members were sent ballots during the month of February 2024. “An email blast to vote was sent out on February 1, 2024…and every Monday until February 29,” the defendants acknowledged in earlier court filings.
The plaintiff asserts, “Not all members of the Occaneechi Band of the Saponi Nation were allowed to participate in the 2024 ratification process due to email-only voting mechanisms,” according to a second amended complaint that Holmes filed in superior court last Tuesday, September 9. Cavalier says she attempted to make “multiple good-faith efforts” to address her concerns with Hayes and the tribal council before resorting to filing a lawsuit.
Holmes told the judge Monday afternoon that without being able to inspect the tribe’s books, it’s difficult to verify the defendants’ claim that the previous eligibility criteria had caused the OBSN’s membership to dwindle to near-extinction.
The case will likely move next into the discovery phase for the lawsuit unless a settlement can be reached out of court. The case was previously designated for a mediated settlement conference, to be overseen by retired former Alamance County senior resident superior court judge G. Wayne Abernathy, according to the court file. The deadline to complete a mediated settlement conference is October 23, 2025.
