Vilsack case that pitted Native American farmers against the U.S. government.
The settlement resolves a nationwide class action lawsuit, requiring the U.S. Department of Agriculture to pay $680 million in damages to thousands of American Indians, while forgiving up to $80 million in outstanding farm loan debt, and improving the farm loan services the agency provides to American Indians. The $760 million settlement is one of the largest American Indians have ever won against the federal government.
“Today, the U.S. District Court approved the settlement reached by the Department of Agriculture and the Department of Justice with the plaintiffs in the Keepseagle class action lawsuit. This is yet another important step forward in addressing an unfortunate chapter in USDA’s civil rights history,” President Barack Obama said. “This settlement would not have been reached without the leadership of Secretary Vilsack and Attorney General Holder, and I want to thank them both for their hard work on behalf of Native American farmers. Today’s approval of the settlement will help strengthen our nation-to-nation relationship with Indian country and reinforce the idea that all citizens have a right to be treated fairly by their government.”
At a fairness hearing on April 28 in Washington, D.C., U.S. District Judge Emmet G. Sullivan granted final approval of the settlement, which was called “historic” by Indian plaintiffs.
“Final approval of the Keepseagle settlement marks the end of an unfortunate chapter in our nation’s history where USDA’s credit discrimination against Native Americans was the norm,” said lead plaintiffs’ lawyer Joseph M. Sellers, of Cohen Milstein Sellers & Toll, PLLC, in a statement. “Under this settlement, Native American farmers and ranchers will finally receive the compensation and justice they deserve, and we will undertake a process to ensure that the USDA treats Native Americans equally and fairly.”
Plaintiffs Claryca Mandan, of Mandaree, N.D., and Porter Holder, of Soper, Okla., attended the hearing that resulted in the approval, and were proud of the result.
“We’ve waited three decades for the USDA to be held accountable to the Native American people. So today is a great day, indeed,” Mandan said in a statement. “The changes to USDA’s Farm Loan Program will mean that our children and grandchildren will inherit a system that is far more responsive and fair to Native Americans than the system that hampered our generation of farmers and ranchers.”
“This settlement will help thousands of Native Americans who are still farming and ranching,” Holder added. “The USDA has some terrific programs, but Native Americans must have equal access to them. That’s what the law requires. We look forward to forging a new era of partnership with the USDA so that our communities can fully benefit from USDA’s farm loan program.”
The suit was first filed more than 11 years ago, on the eve of Thanksgiving 1999, and had stalled under the Clinton and Bush administrations. Once the Obama administration was sworn in, USDA Secretary Tom Vilsack promised to make the case a priority, which ended up resulting in the settlement after sometimes tense negotiations.
“The Keepseagle settlement approved today by the court marks just one more step toward our goal of ensuring that American Indian and Alaskan Native farmers and ranchers not only have a place at the table, but are welcome as full participants in USDA programs. President Obama, Attorney General Holder and I are delighted this day has come and recognize that today is a good day for Indian country,” Vilsack said.
The Indian plaintiffs had alleged that since 1981, Indian farmers and ranchers nationwide were denied the same opportunities as white farmers to obtain low-interest rate loans and loan servicing from USDA, causing them hundreds of millions of dollars in economic losses.
According to lawyers for the plaintiffs, the settlement’s $760 million in monetary relief represents about 98 percent of what the plaintiffs could possibly have won at trial.
Of note, all funds for the settlement will be paid from the federal Judgment Fund, which is controlled by the U.S. Department of Justice, and will not have to be approved by Congress. In contrast, last year’s infamous Cobell settlement was set up in such a way that required congressional approval—thus causing multiple delays.
American Indian farmers and ranchers now have until Dec. 24, 2011 to file claims for damages and debt relief. Lawyers for the Indian plaintiffs provided the following technical details for possible beneficiaries:
“Keepseagle class members will have an option to file individual claims under either Track A or Track B. Track A permits eligible class members to recover up to $50,000 by providing information under oath that they are Native Americans, that they farmed or ranched (or attempted to farm or ranch) between 1981 and 1999, that they sought a loan or loan servicing from USDA during that period, and that they complained when they were denied a loan or otherwise treated unfavorably. Track B permits eligible class members to seek an award of damages up to $250,000, with the amount based upon evidence of their actual economic loss. Track B claims must submit evidence that would be admissible in court to satisfy each of the same elements as Track A, and in addition must identify a similarly situated white farmer who received more favorable treatment.
“Starting in July 2011, Class Counsel will conduct a series of meetings to assist Native American farmers and ranchers with filing claims under Track A. These meetings will occur throughout Indian country from July through December 2011. Class members are encouraged to retain individual counsel for Track B claims, as far more is involved in preparing a successful Track B claim than a Track A claim. A list of attorneys willing to consider Track B claims will be provided to interested class members. Claims approved by a neutral adjudicator are expected to be paid in the summer of 2012.
“Under the settlement agreement, the USDA also will forgive up to $80 million in debt currently held by class members whose claims are approved under Track A or Track B. When the U.S. District Court granted preliminary approval of the settlement in November 2010, that order put into effect a moratorium on foreclosures, debt accelerations and debt offsets not already referred to the U.S. Treasury Department. The moratorium currently applies to all Native American farmers and ranchers and for those who file Track A or Track B claims the moratorium will last until the claims process has concluded. After the debt relief is provided, if there are any class members with remaining debt, who are delinquent on any outstanding USDA farm loan debt, the USDA will engage in a round of loan servicing of that debt.”
Another important provision of the settlement agreement calls for the USDA to improve the delivery and responsiveness of its farm loan program to Indian farmers and ranchers. It will do so by forming a Native American Farmer and Rancher Council, a new federal advisory committee, which will have 15 members, 11 of whom will be American Indians or represent American Indian interests and four of whom will be top USDA officials. The council will meet at least twice a year for the next five years to discuss how to make USDA’s programs more accessible for American Indians farmers and ranchers. The council will report its recommendations directly to senior UDSA officials.
The plaintiffs’ lawyers noted that in addition to establishing the Council, the USDA will take the following additional steps to improve its services: 1) create 10 to 15 USDA regional sub-offices that will provide education and technical assistance to American Indian farmers and ranchers and their advocates; 2) undertake a systematic review of its farm loan policies to determine how its regulations and policies can be reformed to better assist American Indian farmers and ranchers; 3) create a customer guide on applying for credit from the USDA; 4) create the Office of the Ombudsperson to address concerns of all socially disadvantaged farmers and ranchers; and, 5) regularly collect and report data on how well American Indians fare under USDA’s farm loan programs.