The dispute centers on whether state law regulates construction along streambanks on privately owned land inside the park boundaries. The district court concluded that the Flathead Conservation District lacks authority to enforce the Streambed Act against the Amblers because the federal government holds exclusive legislative jurisdiction over the ceded inholdings.

In 1911, Montana ceded jurisdiction to the United States over private inholdings within Glacier National Park, and the United States accepted that cession in 1914. This transfer made federal authority the only authority operating within the ceded area, including privately owned lands within the described park boundaries.

Montana reserved only the powers to serve process and to tax within the ceded territory. The United States has exclusive legislative jurisdiction over these private inholdings, except to the extent that Montana reserved powers at the time of cession.

State law in effect at the time of cession is assimilated into federal law. However, state civil statutes enacted after the cession are not assimilated into federal law unless they are part of the same basic scheme that has been in effect since the time of cession.

The Streambed Act, enacted in 1975, regulates and provides a system for approving construction along streambanks. The Ninth Circuit determined that the Act is not part of the same basic scheme as the laws in effect at the time of cession, which regulated the dumping of sawmill debris and permitted landowners to build docks and wharves along navigable waters so long as they did not impede navigation.

The court rejected arguments that the Streambed Act should be considered criminal law because it contains a criminal component. The Ninth Circuit noted that a law is not criminal simply because it is enforceable by criminal as well as civil means. The shorthand test is whether the conduct at issue violates the state's public policy.

The Streambed Act provides means for seeking approval of construction projects near streams, indicating that its intent is to regulate, rather than prohibit, such construction. Consequently, the Act is not a criminal law and was not assimilated into federal law when it was enacted in 1975.

Friends of Montana Streams and Rivers argued that public policy and federalism concerns support reading the cession statutes to give Montana authority to regulate private property within Glacier National Park. The Ninth Circuit held that these arguments do not support the application of state law where the federal government has exclusive legislative jurisdiction.

Because Montana lacks concurrent legislative jurisdiction, there is no basis to apply the Streambed Act to the Amblers' property. The Ninth Circuit affirmed the district court's grant of declaratory relief.