March 1, 2010
Dear Indian Country
This is the third letter in a series of open letters I’m sending to Indian Country to answer questions that you have asked me about settlement of the Cobell class action lawsuit. Prior Ask Elouise letters can be found on the settlement website: http://cobellsettlement.com/class/ask_elouise.php. We also have a “frequently asked questions” section to answer the most common questions we’ve received: http://cobellsettlement.com/press/faq.php. I can’t answer every question, but I will try to answer as many as I can every week.
Why are resource mismanagement claims included in the proposed settlement and how were they valued as part of the $1.4 billion amount of the settlement? The settlement agreement covers claims that have been part of the Cobell case since it was filed on June 10, 1996, as well as other resource management claims that will be included in an amended complaint. Cobell has always demanded the correction and restatement of accounts and the restitution of profits unlawfully taken from individual Indian trust beneficiaries as a result of the government’s breaches of trust. Importantly, resource mismanagement claims necessarily are included in the accounting claim to ensure a full and complete accounting of the IIM Trust and the effective enforcement of plaintiffs’ vested and constitutionally protected property rights.
Individual class members may opt out of the settlement to pursue individual damages claims arising out of the government’s mismanagement of his or her natural resources. So while resource mismanagement claims are included in the proposed settlement, each class member has the right to decide whether his or her resource mismanagement claims should be resolved through the settlement.
Resource mismanagement claims are included for two principal reasons. First, the government insisted that resource mismanagement claims be included in the settlement. Otherwise, the government would not settle the case. The government stated that it is essential to “turn the page” so that it could build a better relationship with Indian Country, which it felt could only be achieved through what it says is a “global peace.”
Second, I and class counsel concluded that it is fair to include such claims so long as class members may elect to opt out of that portion of the settlement. Thus, if a class member wants to litigate his or her own resource mismanagement claims, that may be done readily and without compromise. But, because it is very expensive and highly unlikely that many beneficiaries have the financial resources to bring their own damages claims, the settlement allows class members who do not opt out of the settlement to be compensated fairly. For an overwhelming number of beneficiaries, settlement of historical damages claims for additional compensation not only is a good option, it is the only way many could be compensated for the harm done to them by the government. The opt-out provision provides each class member fair and meaningful options.
The settlement value of historical resource mismanagement accounting claims was negotiated by the parties. The total amount represents a fair resolution for plaintiffs’ accounting, restitution, and damages claims, considering the risks associated with indefinite litigation, including the absence of any time limit to reach final judgment in the case, the mortality rate of class members, and our understanding of the current litigation environment.
Who represented these claim-holders' interests during the settlement negotiations? I and class counsel represented all class members during the settlement negotiations. In the fairness hearing, the district court, in accordance with due process principles, would determine whether the amount negotiated is fair and whether the class representatives and counsel have adequately represented the class as a whole. After almost fifteen years of intense litigation over the government’s mismanagement of individual Indian trust assets, I and class counsel have the most significant, relevant and practical experience with stated claims of the class. But, you need not rely solely on our judgment in that regard because such matters are determined independently and in accordance with governing law by the presiding U.S. District Judge.
How will the new class be identified? There are two classes resolved by the settlement agreement: the historical accounting class and the trust administration class. Government records, to the extent available, will be used to identify members of the trust administration class. But we know that the government’s records do not identify or locate all members of the trust administration class. Accordingly, after ratifying legislation is passed, the parties, under the U.S. District Judge’s supervision, will conduct an extensive notice process to notify individual Indians of their rights and obligations under the settlement agreement. The notice process will also provide detailed information to Indian Country about the terms of settlement.
The settlement agreement also provides that class members may “self-identify” and apply for inclusion in the trust administration class. A contractor that is working with the parties will analyze all documentation provided by each such potential class member and, under the supervision of the United States District Court, will determine whether that person is a class member.
Is it fair and reasonable to disallow opt-outs from the historical accounting settlement when an historical accounting may be necessary for an individual who opts out of the trust administration class to pursue a resource mismanagement claim? Yes. Any class member who opts out of the settlement will retain the right to what is called an “accounting in aid of judgment,” which is a procedural tool used in the U.S. Court of Federal Claims to help beneficiaries value their damage claims. The settlement agreement explicitly preserves the right of any class member who opts out of the trust administration class to “an accounting in aid of judgment.”
An additional important point must be noted. An individual may remain in the trust administration class, get paid in full, and still pursue the following claims against the government and third parties: breaches of trust arising after September 30, 2009; certain environmental damages; claims against contractors or other third parties; claims for correction of boundary or appraisal errors (and, for damages after September 30, 2009); water rights; health and mortality claims; and claims arising from leases active on September 30, 2009.
I heard that the Settlement Agreement expired on February 28, 2010. Does this mean that the settlement agreement has terminated? No, the settlement agreement has not been terminated. The parties have agreed to extend the settlement through April 16, 2010. In my conversations with government officials, I have been assured that legislation will be passed within that period of time. I remain hopeful that legislation will be passed, but share your concerns that we continue to extend the time period with nothing to show for it. At this point, we must provide our allies time to advance the legislation.
If you are not currently receiving an IIM statement from the government, please remember to register for correspondence over the Internet or by calling the number below.
PO Box 9577
Dublin, OH 43017-4877
Thank you and keep your questions coming!