Cobell v. Babbitt

• Citation: 91 F.Supp.2d 1
• Decision Date: 21 December 1999
• Docket Number: No. 96-1285.,96-1285.
• Parties: Eloise Pepion COBELL, et al., Plaintiffs, v. Bruce BABBITT, Secretary of the Interior, Lawrence Summers, Secretary of the Treasury, and Kevin Gover, Assistant Secretary of the Interior, Defendants.
• Court: U.S. District Court — District of Columbia

Page 1

91 F.Supp.2d 1

Eloise Pepion COBELL, et al., Plaintiffs, v. Bruce BABBITT, Secretary of the Interior, Lawrence Summers, Secretary of the Treasury, and Kevin Gover, Assistant Secretary of the Interior, Defendants.

No. 96-1285.

United States District Court, District of Columbia.

December 21, 1999.

COPYRIGHT MATERIAL OMITTED

COPYRIGHT MATERIAL OMITTED

Dennis M. Gingold, Washington, DC, Thaddeus Holt, Point Clear, AL, Elliott H. Levitas, Atlanta, GA, Keith Harper, Lorna K. Babby, Washington, DC, for Plaintiffs.

Lois J. Schiffer, Assistant Attorney General, Tom C. Clark, II, Senior Counsel, Phillip A. Brooks, Senior Counsel, Charles Findlay, Assistant Chief, U.S. Department of Justice, Washington, DC, for Defendants.

MEMORANDUM OPINION: FINDINGS OF FACT AND CONCLUSIONS OF LAW

LAMBERTH, District Judge.

This matter comes before the court after a six-week bench trial and the submission of an administrative record, proposed findings of fact and conclusions of law by both sides, and responses thereto. Upon consideration of these materials and the record in this case, the court makes the following findings of fact and conclusions of law.

                Table of Contents
                   I. Introduction ................................................................  6
                  II. Findings of Fact ............................................................  7
                      A. History Surrounding IIM Trust Establishment ..............................  7
                      B. The IIM Trust ............................................................  9
                      C. The Indian Trust Fund Management Reform Act of 1994 ...................... 12
                

                      D. The Strategic Plan ....................................................... 13
                      E. The High Level Implementation Plan (HLIP) ................................ 14
                         1. Data Cleanup .......................................................... 14
                            a. OST Trust Fund Records Data Cleanup ................................ 14
                            b. BIA Trust Asset Records Data Cleanup ............................... 15
                         2. BIA and OHA Probate Backlog ........................................... 17
                         3. BIA Appraisal Program ................................................. 18
                         4. Computer Systems ...................................................... 18
                            a. OST Trust Fund Accounting System (TFAS) ............................ 18
                            b. BIA Trust Asset and Accounting Management System (TAAMS) ........... 19
                         5. OST/BIA Records Management ............................................ 20
                      F. Facts Pertaining to Plaintiffs' Interference Claims ...................... 21
                      G. The Department of the Treasury ........................................... 21
                         1. Time Lapse in Availability of Deposited Funds ......................... 22
                         2. Loss of Interest on Issued Checks ..................................... 22
                         3. Illegal Document Retrieval and Retention Policies ..................... 23
                         4. The Sweeping of Money into the Unclaimed Moneys and Miscellaneous
                Receipts Accounts at Treasury ....................................... 23
                 III. Jurisdiction and Scope of Lawsuit ........................................... 24
                      A. Subject Matter Jurisdiction .............................................. 24
                      B. Waiver of Sovereign Immunity ............................................. 24
                      C. Plaintiffs' Common-Law Claims for Breach of Trust ........................ 28
                      D. Scope of Lawsuit ......................................................... 31
                      E. APA "Jurisdiction" ....................................................... 35
                      F. Administrative Record .................................................... 37
                  IV. Declaratory Judgment—Basic Principles ................................. 38
                   V. Declaratory Judgment—The Secretary of the Interior .................... 40
                      A. Overview ................................................................. 40
                      B. Declaration of Trust Duties Arising from the Indian Trust Fund Management
                Reform Act .............................................................. 40
                         1. The Secretary of the Interior's Duty to Perform Accounting on All
                IIM Trust Money ...................................................... 40
                         2. The Secretary of the Interior's Duty to Establish Written Plans for
                Gathering of Missing Information; Document Retention; Business
                and Computer Systems Architecture; and Staffing of Trust
                Management Functions ................................................. 41
                            (i.) Introduction ..................................................... 41
                            (ii.) document retrieval and retention ................................ 42
                            (iii.) systems architecture and staffing .............................. 43
                      C. The Deadline for the Discharge of the Secretary of the Interior's Four
                Declared Planning Duties Has Passed .................................... 45
                      D. The Secretary of the Interior is Currently in Breach of Four Statutory
                Trust Duties that Warrant Prospective Relief ........................... 48
                         1. The Secretary of the Interior Has No Written Plan to Gather Missing
                Data ................................................................ 48
                         2. The Secretary of the Interior Has No Written Plan Addressing the
                Retention of IIM-Trust Documents Necessary to Render an Accounting .. 49
                         3. The Secretary of the Interior Has No Written Architecture Plan ........ 49
                         4. The Secretary of the Interior Has No Written Plan Addressing the
                Staffing of Interior's Trust Management Functions ................... 49
                  VI. Declaratory Judgment—The Secretary of the Treasury .................... 49
                      A. The Secretary of the Treasury's Duty to Retain IIM-Trust Documents
                that are Necessary for the Rendition of an Accounting .................. 49
                      B. The Secretary of the Treasury Has Breached His Fiduciary Duty to
                Retain IIM-Trust Documents and Has No Remedial Plan to Address
                This Breach of Duty .................................................... 50
                 VII. Plaintiffs' Obstruction Claims .............................................. 51
                VIII. Remedy ...................................................................... 52
                  IX. Certification of Order for Interlocutory Appeal ............................. 57
                   X. Conclusion .................................................................. 57
                

I. Introduction¹

It would be difficult to find a more historically mismanaged federal program than the Individual Indian Money (IIM) trust. The United States, the trustee of the IIM trust, cannot say how much money is or should be in the trust. As the trustee admitted on the eve of trial, it cannot render an accurate accounting to the beneficiaries, contrary to a specific statutory mandate and the century-old obligation to do so. More specifically, as Secretary Babbitt testified, an accounting cannot be rendered for most of the 300,000-plus beneficiaries, who are now plaintiffs in this lawsuit. Generations of IIM trust beneficiaries have been born and raised with the assurance that their trustee, the United States, was acting properly with their money. Just as many generations have been denied any such proof, however. "If courts were permitted to indulge their sympathies, a case better calculated to excite them could scarcely be imagined." Cherokee Nation v. Georgia, 30 U.S. (5 Pet.) 1, 15, 8 L.Ed. 25 (1831) (Marshall, C.J.).

Notwithstanding all of this, defendants, the trustee-delegates of the United States, continue to write checks on an account that they cannot balance or reconcile. The court knows of no other program in American government in which federal officials are allowed to write checks—some of which are known to be written in erroneous amounts—from unreconciled accounts—some of which are known to have incorrect balances. Such behavior certainly would not be tolerated from private sector trustees. It is fiscal and governmental irresponsibility in its purest form.

The United States' mismanagement of the IIM trust is far more inexcusable than garden-variety trust mismanagement of a typical donative trust. For the beneficiaries of this trust did not voluntarily choose to have their lands taken from them; they did not willingly relinquish pervasive control of their money to the United States. The United States imposed this trust on the Indian people. As the government concedes, the purpose of the IIM trust was to deprive plaintiffs' ancestors of their native lands and rid the nation of their tribal identity. The United States reaped the "benefit" of this imposed program long ago—sixty-five percent of what were previously tribal land holdings quickly opened up to non-Indian settlement. But the United States has refused to act in accordance with the fiduciary obligations attendant to the imposition of the trust, which are not imposed by statute.

The defendants cannot provide an accounting of plaintiffs' money, which the United States has forced into the IIM trust. This problem, which has been handed down from administration to administration of apologetic United States trustee-delegates to generation upon generation of helpless beneficiaries, continues today and is the basis for this lawsuit. It imposes far more than pecuniary costs, although those are clear and cannot be overstated. Plaintiffs' class includes some of the poorest people in this nation. Human welfare and livelihood are at stake. It is entirely possible that tens of thousands of IIM trust beneficiaries should be receiving different amounts of money— their own money—than they do today. Perhaps not. But no one can say, which is the crux of the problem.

Plaintiffs bring this lawsuit to force the government to abide by its duty to render an accurate accounting of the money currently held within the IIM trust. But plaintiffs must remember that this is a...