Appeals court backs ruling for Indians on trust accounts
The Denver Post
By: Bill McAllister
Denver Post Washington Bureau Chief
February 26, 2001
WASHINGTON – In a major victory for American Indians, a federal appeals court found “ample evidence” Friday to support a lower court ruling that declared the federal government breached its responsibility to hold billions of dollars in Indian trust accounts.
The decision presents new Interior Secretary Gale Norton with her first major challenge. Only a day after the former Colorado attorney general assured Indian leaders that she takes her trust responsibilities “very seriously,” Norton will have to decide whether to appeal a ruling that questions that very relationship.
A three-judge U.S. Court of Appeals panel found that Interior failed to live up to its trust duties to Indians “for decades.” Specifically, the judges held that the department failed to give the Indians “the most fundamental of trust duties – an accurate accounting” of the monies the government is holding for them.
“We’re disappointed with some parts and heartened by some parts of the decision of the Court of Appeals, and will be working with the Department of Justice to determine our next course of action,” said Stephanie Hanna, an Interior spokeswoman.
At issue is the accuracy of thousands of individual trust accounts that the federal government established for about 300,000 Indians. Those accounts were to hold money that the government received from private industry for minerals, oil and gas that were taken from the lands. Under Friday’s ruling, the government must provide account holders a full accounting of the money they are owed. But that won’t be easy, the three-judge panel noted. Indian lawyers allege there should be 500,000 account holders.
“Not only does the Interior Department not know the proper number of accounts, it does not know the proper balance for each. . .account, nor does Interior have sufficient records to determine the value of the. . .accounts,”
the court noted in a 30-page opinion laced with barbs over the government’s acknowledged mishandling of the accounts.
There is no dispute, the appeals panel said, that the government had delayed a resolution of its well-known inability to reconcile the trust account balances.
“We think their next course of action will be to get their checkbook out,” said Elousie P. Cobell, a Montana banker and member of the Blackfeet Tribe, who was the lead plaintiff in the case. “This marks a new beginning for native people. . .no more ducking and diving. And we’ll be right in their face all along making sure it happens.”
The appeals court decision gave much credit to the lawyers who have fashioned the Indians’ appeal.
“What little progress the government has made appears due more to the litigation than diligence in discharging its fiduciary obligations,” the court said.
That statement validated the class action lawsuit filed nearly five years ago by the Coloradobased Native American Rights Funds and the efforts of Washington attorney Dennis Gingold, a former Denver lawyer, to aggressively pursue the case in the federal courts. Using e-mail press releases and a site on the Internet, Gingold has made the lawsuit a major cause among Indians across the nation.
Sen. Ben Nighthorse Campbell, R-Ignacio, chairman of the Senate Indian Affairs Committee, applauded the ruling.
“It gives more credibility to the Indian people who filed the lawsuit,” he said.
The ruling by the three-judge panel was unanimous and it was almost as harshly critical of the government as was District Judge Royce C. Lamberth when he called it “fiscal and governmental irresponsibility in its purest form” in December 1999.
“It would be difficult to find a more historically mismanaged federal program than the individual Indian money trust,” Lamberth said then.
Government lawyers argued that Lamberth had exceeded his authority and vowed to continue to oversee the government’s program to reconcile the Indian accounts. The ruling Friday rejected those arguments, holding that Lamberth was well within his authority.
Unless the government appeals the case to the U.S. Supreme Court, the issues will be returned to Lamberth’s court for a second trial, presumably one designed for “correcting the accounts” as the judge once put it.
The government can now present evidence of what the balances in the accounts should be and lawyers for the Indians can object, the appeals court said.
The appeals court traced the history of the trust accounts, saying the government’s trust responsibility to hold lands and monies for Indians is more than 100 years old. But the accounts “have been mismanaged nearly as long,” the court added.
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