Lake County won't challenge an Indian tribe's legal quest for federal recognition, which could lead to a new tribal casino in the North Bay.

Sonoma and Napa counties still oppose recognition for Alexander Valley's Mishewal Wappo tribe, which lost its federal status in 1959.

The Wappos filed suit against U.S. Interior Secretary Ken Salazar in 2009, charging the federal government acted unlawfully when it disbanded the tribe. The Wappos are asking the Interior Department to restore their tribal status, benefits and historic land rights. If successful, the lawsuit would authorize casino gambling on its restored land.

The tribe historically lived in parts of all three counties. There were 8,000 Wappos in 1851, but only 340 today, the tribe said.

The case is pending in U.S. District Court in San Jose.

Last year, Sonoma, Lake and Napa won Judge James Ware's approval to intervene in the lawsuit, arguing the tribe shouldn't be allowed to take land from their jurisdictions without consulting them.

The counties asked Ware last July to throw out the tribe's lawsuit, alleging the Wappos waited too long to bring their complaint. A hearing on that motion is scheduled April 4.

But Lake County has dropped out of the case after reaching a settlement with the tribe in November. Under terms of the deal, the Wappos can't acquire tribal land in Lake County for at least 10 years after they regain federal recognition.

After the moratorium expires, the tribe must consult with the county and comply with its development rules before taking land into federal trust, according to the settlement. Any tribal development also would have to meet state and federal environmental laws.

In exchange, Lake County agreed to withdraw from the court case. The county dropped out in December.

Officials of the county and the tribe didn't respond to requests for comment Tuesday.

The U.S. Bureau of Indian Affairs established a 54-acre reservation for the Wappo tribe on the Russian River northeast of Healdsburg starting in 1908. But the tribe's Alexander Valley Rancheria lost its federal status 51 years later after Congress passed a law aimed at privatizing California's small Indian communities.

The tribe's lawsuit says its land was improperly distributed and the federal government didn't keep a promise to improve water, roads and sanitation.

In another development, Ware last week denied the petitions of three Napa County cities to intervene in the tribe's lawsuit. Napa, St. Helena and American Canyon said they'd be harmed if the tribe acquires land for a casino within or near their borders.

But Ware said the cities' concern is based on "mere speculation" about the tribe's plans. He said the cities could join the case later if the tribe decides to seek land within their boundaries.

Last year, tribal chairman Scott Gabaldon said the tribe won't decide on its future plans — including a possible casino — until it regains federal recognition.