A federal judge in Oklahoma dismissed a lawsuit Monday that had been filed against Connecticut Banking Department officials who had imposed a $1.5 million fine on two tribal payday lending companies and the head of the tribe.

Last week, Judge Joe Heaton dismissed the lawsuit filed against former Banking Commissioner Howard Pitkin and Bruce Adams, the department’s general counsel, by John Shotton, head of the Otoe-Missouria Tribe.

Heaton concluded that the action Pitkin and Adams took against the tribal lending companies was not “aimed at the State of Oklahoma. Rather, they were directed to plaintiff’s (and the companies’) actions in the State of Connecticut and their alleged violations of Connecticut law. That the alleged violators lived in, or were based in, Oklahoma was incidental. The ‘focal point’ of defendants’ efforts was Connecticut, not Oklahoma.”

The Banking Department imposed a $700,000 fine on Great Plains, a $100,000 fine on Clear Creek, and a $700,000 fine on Shotton for violating the state’s small loan law by charging Connecticut borrowers annual interest rates ranging from 199.44 percent to 448.76 percent on short-term loans of less than $15,000. Loans for less than $15,000 are capped at 12 percent in Connecticut.

Adams said Heaton’s analysis was “solid” and the department is “pleased we can focus our efforts on the pending litigation in Connecticut state court.”

The tribal lending organizations appealed the fines and the action by the Banking Department in New Britain Superior Court in January. That lawsuit is still pending.

In its argument to the court, lawyers for the tribal lending organizations maintain that they shouldn’t have to follow Connecticut’s laws and regulations because they are the extension of a sovereign nation. But the same argument of protection and sovereignty could be made on behalf of the state.

“The attempts by each sovereign to manage its own internal affairs by combating poverty within its borders have collided in this case,” former Banking Commissioner Howard Pitkin wrote in his denial of the tribes’ attempt to have the banking enforcement action dismissed.

The tribal lending organizations contend that they could be subject to federal laws, but are not subject to state laws.

Recently, the tribe filed a brief claiming the state’s action and fine “violates the legal principles of sovereign immunity so deeply engrained in the fabric of federal Indian law and policy.”

The attorney for the two tribal lending companies goes onto argue that: “Tribal sovereignty is not subject to diminution by the states and thus, neither is sovereign immunity.”

As recently as July, members of the Otoe-Missouria Tribe held a “sovereignty rally” to show their support for the legal action being taken in Connecticut.

According to a report in the Native American Times the tribe feels the state of Connecticut has tried to attack its sovereignty.

The Banking Department is expected to file its response in that lawsuit shortly.