Settlement Agreement Reached in Cobell V Salazar

The lawsuit, Cobell v Salazar was first filed in 1996 by Native American plaintiffs who alleged mismanagement of individual Indian trust accounts and trust assets by the federal government. These assets include oil, minerals, natural gas, water, timber and other natural resources and rights on, in or under individual Indian lands.

The settlement addresses charges that the government failed in its duty to administer individual Indian trusts and that this mismanagement resulted in the loss, misdirection and unaccountability of billions of dollars that should have been held in trust for holders of IIM (Individual Indian Money) accounts.

What are Tribal Trust Lands?

Historically, contact with European settlers brought about intense conflict over the concept of property ownership. Traditionally, Native Americans were stewards of the earth who viewed the land as sacred, to be used only as needed and to be cared for. Settlers thought of land as property to be seized and owned by individuals. Vast empires were established by acquisition of property for personal and commercial development. Natural resources in vast quantities were depleted.

The federal government believed that Tribes were unable to manage their own land. In 1934, the Indian Reorganization Act enabled the Department of Interior to take Native American lands into trust. Title to tribal properties is still held by the federal government, with the justification that the trust arrangement protects tribal lands for future generations. Trust status establishes limitations on tribal usage of their own land. The Act was also supposed to initiate compensation of Tribes for unjust takings of their lands throughout the years.

Who Are the Beneficiaries of the Settlement Agreement?

The settlement agreement is between plaintiffs who are beneficiaries of Individual Indian Money accounts, and the Secretary of the Interior, Assistant Secretary of the Interior for Indian Affairs, and the Secretary of the Treasury.

What are the Terms of the Agreement?

Terms of the agreement include a requirement that the federal government create a $1.4 billion Accounting/Trust Administration Fund and a $2 billion Trust Land Consolidation Fund. Also included in the settlement is a provision to create an Indian Education Scholarship fund worth up to $60 million to help provide access to higher education for Indians. Additionally, the federal government must establish a commission to oversee and monitor improvements to accounting procedures for managing individual trust assets.

How Are the Beneficiaries Defined?

The Historical Accounting Class includes the following individual Tribal members who were:

1. Alive on September 30, 2009, who had an IIM Account open at some time between October 25, 1994 and September 30, 2009, and who conducted at least one transaction credited to that account that was not later reversed;

2. Beneficiaries deceased as of September 30, 2009 if they still had an account open on that date;

3. Estates of beneficiaries who die after September 30, 2009 but before distribution of settlement monies.

The Trust Administration Class includes individual Indian beneficiaries who:

1. Were alive on September 30, 2009 who currently have or did have IIM Accounts dating from about 1985 through to the present (a time period termed the 'Electronic Ledger Era';

2. Can demonstrate an ownership interest in land held in trust or restricted status, whether or not the individual also had an IIM Account and regardless of whether ownership of that land generated any proceeds.

Individuals are urged to read about exceptions that apply to members of both classes, keeping in mind the all important date of September 30, 2009.

What Happens Next?

The announcement that a settlement agreement has, at long last, been reached is only the first step before monies awarded to the plaintiffs can be distributed. Congress must pass legislation that confirms or authorizes the settlement. This is because the federal government acts as trustee for all funds earned by Indian lands and resources. Once Congress passes the legislation, there will be a procedural request by the parties to approve the agreement and certify the Trust Administration portion of the lawsuit as a class action. This type of action is made up of plaintiffs who sue on behalf of other individuals who are in the same situation. The Historical Accounting Class was already certified as a class action.

How Will Plaintiffs Learn About the Settlement Agreement?

Pending certification and if the Court grants preliminary approval of the agreement, all class action members must be given notice of the settlement. IIM Account Holders and individuals with interests in trust land who can be identified and located with a current address will be sent a Direct Class Notice.

Other beneficiaries of the settlement or their heirs who cannot be identified will be notified through media including newspapers, television and radio. Tribes and government agencies will also help in getting the word out to individual Tribal members.

It's important to note that after receiving notice, individual members in the Trust Administration Class must decide whether or not to participate in the Agreement. If they do, no action is required. If they do not and the Claims Administrator does not have a current address, members must register with the Administrator at https://cert.tgcginc.com/iim/register.php to receive notice and then say that they do not want to participate as a class member.

After the Notice Period and prior to approval of the Settlement, the Court will hold a Fairness Hearing to determine if the Settlement Agreement is fair, reasonable and adequate. This will be an opportunity for members of both classes to object for any provisions of the settlement.If the Court issues an approval of the Settlement, opponents may appeal the court order. Such an appeal, if recognized, would move on to a higher court for a decision. Once all appeals are resolved and any additional hearings are held, the Court will grant final approval and distribution of monies awarded through the Settlement Agreement to individual class members will begin. It must be noted that at any point during this long process, finalization of the Agreement may not be reached and the Settlement may not go forward.

If the Settlement Agreement is Approved, How Much Will Beneficiaries Receive?

There will be several different kinds of distribution. Most beneficiaries are members of both classes and will receive no less than $1,500 each. This breaks down to an initial payment of $1,000 to members of the Historical Accounting Class and a minimum of $500 for members of the Trust Administration Class. Members of the latter class will also receive a percentage of the remaining Fund that will be based on how many individuals share the Fund. Attorneys' fees and other costs must be paid before the remaining funds are distributed.

Visit the website, www.CobellSettlement.com, for additional information.