Keepseagle v. Vilsack, Civil Action No. 99–3119 (EGS)
| Decision Date | 24 July 2015 |
| Docket Number | Civil Action No. 99–3119 (EGS) |
| Parties | Marilyn Keepseagle, et al., Plaintiffs, v. Tom Vilsack, Secretary, U.S. Department of Agriculture, Defendant. |
| Court | U.S. District Court — District of Columbia |
John Garfield Dillard, Stewart Douglas Fried, Olsson Frank Weeda Terman Matz P.C., Washington, DC, for Plaintiffs.
Amy E. Powell, Eric J. Soskin, Justin Michael Sandberg, U.S. Department of Justice, Joseph M. Sellers, Cohen Milstein Sellers & Toll PLLC, Washington, DC, for Defendant.
This case places the Court in the unenviable position of enforcing a five-year-old bargain that nobody likes. The bargain at issue is not any old contract; rather, it is a settlement agreement that resolved a major civil-rights class action, was approved by the Court in accordance with the Federal Rules of Civil Procedure, and was made final by that approval and the lack of appeal therefrom. The story that led this case to its current posture is as unique as it is disappointing. In brief, the $680,000,000 in damages that were awarded under the settlement agreement was intended to compensate Native American farmers who alleged that the United States Department of Agriculture discriminated against them personally. The agreement created a claims process for distributing this money, but the claims process failed and $380,000,000 remains undistributed. The scope of this failure is monumental; the reasons for it remain unclear.
The agreement was finalized before the claims process began, so no one anticipated such a large amount of excess funds. But the parties did anticipate that some money might be leftover, so they included in their settlement agreement a cy pres provision, which directs that all leftover funds be distributed in equal shares to a group of charities that serve Native American farmers and ranchers that were to be chosen by Class Counsel. Now, faced with the prospect of over half of the plaintiffs' damages being distributed in equal shares to charities nominated by Class Counsel, many class members regret that part of their agreement and want to change it. Principal among those class members is Marilyn Keepseagle, who has asked the Court to modify the agreement to create a renewed claims process to distribute more of the money to individual class members. Others, including Class Counsel, ask to modify only the charitable-distribution procedures to accommodate the large amount of money to be distributed by: (1) allowing it to be distributed in unequal shares scaled to an organization's capacity; (2) spreading the distribution over twenty years; and (3) placing distribution decisions in the hands of a trust run by Native American leaders.
Unless there is a legal basis for this Court to modify the agreement, the Court must enforce the agreement reached in 2011. Doing so would frustrate all parties' goals. Contrary to the Keepseagles's wishes, the funds would remain entirely for charitable distribution. Contrary to the goals of Class Counsel and the government, that charitable distribution would be pursuant to the arguably inefficient procedures that were designed to handle a much smaller amount of money. This result could be viewed as both unjust and inefficient. Over half of the class's damages would be distributed to third parties, despite the relative ease with which class members could be identified, the claims process reopened, and previously successful claimants permitted to prove that they suffered damages in excess of the compensation they have obtained.
The Court's role is not to craft a new compromise based upon the Court's own views about the appropriate amount of compensation due to class members who alleged decades-long, and, in many cases, life-altering discrimination at the hands of their federal government. Nor is it to create a preferred process for distributing the funds to charity. Before the Court is a simple question: Are any of the narrow circumstances in which a court's final judgment may be modified present in this case?
The avenues proposed by the parties for unilateral modification—Class Counsel's attempt to realign the charitable-distribution procedures pursuant to Federal Rule of Civil Procedure 60(b)(5), and the Keepseagles's attempt to reopen the claims process pursuant to the legal doctrine governing unclaimed funds as well as Rules 60(b)(5) and 60(b)(6) —are simply inapplicable, as the Court discusses in detail in Parts II.A and II.B of this Opinion. Absent a way to modify the agreement unilaterally, the parties must come to a consensus themselves, which their settlement agreement defines as "the written agreement of the Parties." As the Court finds in Part II.C, this language requires more than the agreement of Class Counsel and the government, over the objection of at least one class representative and many class members, which is what is presented by Class Counsel's proposed modification. It also requires more than an alignment between Class Counsel, the class representatives, and members of the class, who would all prefer that the money be distributed directly to class members. Because there is no consensus within the meaning of the agreement, and because the parties' proposals for unilateral modification are legally insufficient, the Court DENIES both pending motions for modification of the settlement agreement. The Court expects that there will be review of the legal conclusions reached in this Opinion by appellate courts. Upon resolution of appellate proceedings, if this Court's legal conclusions are undisturbed, the Court will grant the Parties a period of time to negotiate an agreement that they may jointly present to the Court.
* * *
Before beginning its legal analysis, the Court makes some observations regarding the government's arguments. The government has chosen to oppose any modification of the settlement agreement that would alter the cy pres nature of the funds in any way, based upon concerns that class members might receive a "windfall" in excess of the damages they suffered and that reopening the claims process would undermine the government's interest in the finality of court judgments.
The Executive Branch's narrow position today stands in stark contrast to the messages of respect and reconciliation it expressed upon the settlement of this case. Upon announcement of the settlement in 2010, the President issued the following statement:
Statement by the President on Settlement Agreement in the Native American Farmers Lawsuit Against USDA, White House Office of the Press Secretary (Oct. 19, 2010), https://www.whitehouse.gov/the-press-office/2010/10/19/statement-president-settlement-agreement-native-american-farmers-lawsuit. A statement issued by Secretary Vilsack and then-Attorney General Holder expressed similar sentiments:
Agriculture Secretary Vilsack and Attorney General Holder Announce Settlement Agreement with Native American Farmers Who Claim to Have Faced Discrimination by USDA in Past Decades, USDA Office of Communications (Oct. 19, 2010), http://www.usda.gov/ wps/portal/usda/usdamediafb?contentid=2010/10/0539.xml & printable=true & contentidonly=true.
The Court is sympathetic to the government's legal argument that the settlement is a final judgment and that respect for final judgments is a cornerstone of our legal system. Indeed, that argument ultimately binds the Court. That is the Court's role: To resolve legal disputes, not make policy decisions, even when the law dictates a result the Court may disfavor. The Executive Branch, however, has a broader role: To defend itself in litigation, for sure, but also to seek justice on a broader stage. It is for that reason, the Court presumes, that the government sometimes settles cases that implicate deep-seated interests of justice, even where the government's legal defense may be relatively strong.
This case was not an abstract legal dispute. It was a major class-action seeking to remedy what many felt was the latest chapter in the federal government's sordid history of mistreating Native Americans. The statements of the President, Secretary Vilsack, and then-Attorney General Holder make clear that the government in 2010 understood this dimension of the case. The...
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