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Tribes file class action trust accounting lawsuit
Thursday, January 4, 2007

The Native American Rights Fund filed a major class action lawsuit against the federal government last week, seeking an accounting of billions of dollars in tribal trust funds.

With the suit, the nonprofit law firm seeks to represent over 250 tribal governments whose money has never been accounted. Eleven tribes signed on as plaintiffs in the case, the first of its kind.

"This lawsuit is a reflection of a huge historical problem with the federal government's mismanagement of tribal trust accounts," said Rebecca Miles, the chairwoman of the Nez Perce Tribe of Idaho, the lead plaintiff. "We have tried to work with the agencies and we have tried to work with Congress. Our hope now is with the courts."

Filed on December 28 in federal district court in Washington, D.C., the suit joins dozens of similar cases filed by individual tribes. It also joins the Cobell lawsuit that represents over 500,000 individual tribal members whose funds remain unaccounted despite the obligations of the Interior Department to do so.

John Gonzales, the chairman of NARF's board of directors, said tribes had to take action to beat a critical deadline. The statute of limitations to file trust accounting lawsuits expired on December 31, after the 109th Congress refused to extend it amid opposition from the Bush administration.

"The real battle will be over what more the court or Congress will do to protect the rights of tribes and hold the government accountable for its duties as the trustee for tribal trust funds," said Gonzales, a former president of the National Congress of American Indians.

Gonzales, who also has served as governor of San Ildefonso Pueblo in New Mexico, said tribes are challenging the government's failure to conduct an accounting of tribal funds dating back to the late 1800s. Although the Bureau of Indian Affairs paid the former accounting firm Arthur Anderson to look ate tribal accounts, the reconciliation project only looked at the years 1973 through 1992.

"We are confident that the court will agree that the Arthur Andersen reconciliation reports are not full and complete accountings," said Gonzales.

John Echohawk, the executive director of NARF, said the Arthur Anderson project marked another breach of the federal government's basic trust responsibilities. In legal filings, the Department of Justice has argued that the reconciliation reports are an accounting even though the Government Accountability Office has said such an accounting is "impossible" due to inaccurate, missing or destroyed records.

"The bottom line is that despite the agency reports and twenty years of Congressional mandates, no adequate accountings have resulted to date," said Echohawk, a member of the Pawnee Tribe of Oklahoma, citing attempts by the GAO, Interior Department's Office of the Inspector General and Congress to shed light on the issue.

Despite the failure to complete the accountings, the Department of Justice has repeatedly sounded alarms about massive tribal trust fund litigation. In testimony to Congress, Attorney General Alberto Gonzales has begged appropriators for money in order to defend the government and "limit" its liabilities.

"The United States' potential exposure in these cases is more than $200 billion," Gonzales has said.

Tribes and individual Indians have been filing breach of lawsuits for decades, recovering some money here and there. The Mississippi Band of Choctaw Indians commissioned a study that showed only about a dozen cases resulted in awards of more $1 million.

It wasn't until Elouise Cobell, a member of the Blackfeet Nation of Montana, came into the picture that the legal landscape exploded. In December 1999, she won a precedent-setting ruling that required the government to conduct an accounting of all funds. NARF serves as co-counsel on the case.

At least 50 tribes have followed on Cobell's footsteps with lawsuits of their own. As the December 31 deadline approached, dozens more considered their options but grappled with the cost of filing a claim and the resources needed to carry it through.

"Moreover, over two hundred and fifty tribes have not brought or are unable to bring such claims either due to lack of resources, or because they are unaware that their legal rights are in jeopardy, of expiring under statutes of limitation," NARF's filing stated. "Hence, this class action is necessary to protect the rights of tribes in the class as defined in this complaint."

Since 2001, the Bush administration has spent hundreds of millions of dollars on accounting projects for tribes and individual Indians. But none of the tribal cases, nor the Cobell case, have been fully resolved through the courts or through settlements.

Key Senate and House leaders introduced a bill to settle the Cobell case for $8 billion. It was met with extreme opposition in Indian Country after the Bush administration also proposed to settle all pending and future tribal claims and radically diminish the trust relationship.

In addition to the Nez Perce Tribe, the other named plaintiffs are the Mescalero Apache Nation of New Mexico, the Tule River Tribe of California, the Hualapai Tribe of Arizona, the Yakama Nation of Washington, the Klamath Tribes of Oregon, the Yurok Tribe of California, the Cheyenne-Arapaho Tribes of Oklahoma, the Pawnee Nation of Oklahoma, the Sac and Fox Nation of Oklahoma, and the Santee Sioux Tribe of Nebraska.

NARF Complaint:
Nez Perce Tribe v. Kempthorne (December 28, 2006)

DOJ Letter:
Opposition to Extending Statute of Limitations (December 2005)

Statute of Limitations Bill:
S.1892 | H.R.4292 | Congressional Budget Office Cost Estimate

Relevant Links:
Native American Rights Fund - http://www.narf.org
Indian Trust: Cobell v. Kempthorne - http://www.indiantrust.com

Related Stories:
Navajo Nation weighs trust lawsuit before deadline (11/3)
Tribal trust claims face challenge from Bush (10/31)
Cobell attorney criticizes Bush changes to bill (10/27)
Staff confirms Bush behind Cobell proposals (10/26)
Bush seeks major changes to Cobell bill (10/24)
Senate committee holds more Cobell meetings (10/23)
Time running out on Cobell settlement bill (10/23)
NCAI to consider resolution in support of Cobell bill (10/6)
Latest delay in Cobell settlement tied to White House (10/3)
Cobell: Interior mishandles Indian money too (10/2)
Osage Nation wins major trust fund ruling (09/25)
Navajo woman fights for trust fund accountability (9/25)
Senate committee sends Cobell letter to Kempthorne (9/18)
Interior delays Cobell settlement legislation (9/15)
Great Plains tribes to discuss breach of trust claims (09/14)
McCain firm on $8B settlement for Cobell (9/5)
Congress extends deadline to file tribal trust claims (01/13)
Statute of limitations about to run out on tribal trust (12/07)
Senate committee takes up slate of Indian bills (10/27)
Senate Indian Affairs sets business meeting (10/20)
Supreme Court refuses Bush appeal of trust case (04/19)
Supreme Court to weigh appeal of trust lawsuit (04/07)
Bush administration won't give up fight on Cobell (03/18)
McCain weighs GAO probe of Indian trust debacle (03/10)
McCain lays out Indian agenda for 109th Congress (3/7)
Wind River Tribes settle some trust claims for $12M (06/11)
Wyoming tribes win appeal of breach of trust lawsuit (04/08)
Appeals court revives Wind River royalty fraud case (4/7)
Judge advances suit over royalty mismanagement (10/03)
Osage Nation trust suit survives first test (07/31)
Judge upholds ongoing trust relationship (04/29)
Navajo Nation fallout considered (3/7)
Navajo Nation's Peabody lawsuit to continue (3/7)
Supreme Court issues trust decisions (3/4)
Supreme Court upholds common law trust claim (3/5)
High court ruling makes 'passive' trustee of U.S. (3/5)
A mixed bag for Indian trust (3/5)
Supreme Court offers split victory on trust (3/5)
Supreme Court issues trust decisions (3/4)
Tribes mired in trust fund resolution (6/7)
Trust accounting looms for tribes (3/20)
GAO: Full reconciliation impossible (2/8)

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