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Trust fund case goes before appeals court again

Elouise Cobell, Mary Johnson and Ervin Chavez arrive at the National Museum of the American Indian. Drummers from Blackfeet Nation follow.
Elouise Cobell, the lead plaintiff in the trust fund lawsuit, renewed her call to appoint a receiver to oversee the money and assets of 500,000 individual Indians as a federal appeals court considered the case on Tuesday.

At a forum in Washington, D.C., Cobell said she supports S.1439, the Indian Trust Reform Act. The bill would settle the class action suit she filed in 1996 and make changes at the Interior Department in hopes of fixing the broken trust.

But Cobell, a member of the Blackfeet Nation, questioned whether the department is up to the job after more than a century of mismanagement, during which an accounting of at least $13 billion has never been provided. "Can the government really reform itself?" she asked at a Center for American Progress panel moderated by former Sen. Tom Daschle (D-South Dakota) on Tuesday afternoon.

"Drastic mismanagement," she added, calls for "drastic measures," such as the appointment of a temporary receiver to fix the system. "That's how it's done in the real world," she said.

Cobell's comments came after the D.C. Circuit Court of Appeals heard arguments in the latest series of appeals in the long-running case. During the three-hour hearing, attorney Keith Harper of the Native American Rights Fund noted that the plaintiffs have asked for a receiver but their motion has been denied.

"We do not have the most basic aspects of a trust," Harper, a member of the Cherokee Nation, told the panel of three judges. "We are treated as less than deserving of the rights attributed to all others."

Dennis Gingold, an attorney in private practice who is co-counsel on the case, decried the lack of security protections for the computer systems that house billions in Indian trust fund data. Hackers have been able to break into the system and change information without being detected by Interior.

"The Indians didn't ask for their property to be put in trust," Gingold told the court. He cited an investigation by the department's inspector general that found "numerous instance of fraud and mishandling of trust funds" just within the past few years.

The Bush administration took the case to the appeals court to raise three issues. The first is a preliminary injunction that requires the disconnection of Indian trust systems from the Internet; the second is a notice the government is required to send to all Indian beneficiaries that warns them of "unreliable" trust data; and the third is an unprecedented motion to remove Judge Royce Lamberth from the case by assigning it to another judge.

The appeals court appeared most resistant to overturning the injunction. The judges balked when Department of Justice attorney Marc Stern argued that the Interior's computer systems can't be disconnected under "any circumstances."

"If someone is stealing money from the Indians, it wouldn't require an injunction?" asked Senior Judge Laurence H. Silberman, a Reagan appointee.

On the second issue, the court appeared to be concerned about the procedural and factual basis that led Lamberth to order distribution of the notices. Judge David S. Tatel, a Clinton appointee, questioned why Interior has to warn Indian people about unreliable information "even on matters that have nothing do with trust accounts."

The last issue also posed even tougher questions for the court. In a lengthy decision accompanying the order for the notices, Lamberth called Interior "the morally and culturally oblivious hand-me-down of a disgracefully racist and imperialist government that should have been buried a century ago, the last pathetic outpost of the indifference and anglocentrism we thought we had left behind."

Department of Justice attorney Peter Keisler said Lamberth's language is proof that he has pre-judged Interior without facts on the record. "We have not been shown to be the hand-me-down of a racist, imperialist government," he told the court.

Tex Hall, the chairman of the Mandan, Hidatsa and Arikara Nation of North Dakota and an individual Indian trust beneficiary, said he was "appalled" by the attempt to remove Lamberth. Hall, who attended the appeals court hearing along with a couple of dozen beneficiaries and their supporters, has previously testified in the case about the hardships endured by account holders and the lack of information they receive from their trustee.

"You will receive a check and not know what it's for," he said at the Center for American Progress forum. "The system needs to be fixed. It is a broken system."

Hall, the former president of the National Congress of American Indians, joined Cobell in support of the trust reform bill. He said real reform requires trust management standards and independent oversight. "The standards are the bread and butter," he said.

Judge Lamberth Rulings
Trust Fund Notices (July 12, 2005) | Internet Shutdown (October 20, 2005)

Indian Trust Reform Act:
S.1439 | H.R.4322

Relevant Documents:
Trust Reform and Cobell Settlement Workgroup Principles for Legislation (June 2005)

Relevant Links:
National Congress of American Indians -
Intertribal Trust Fund Monitoring Association -
Indian Land Working Group -
Indian Trust: Cobell v. Norton -
Cobell v. Norton, Department of Justice -
Senate Indian Affairs Committee -