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Interior ordered to notify trust recipients

WASHINGTON - The court in the Cobell trust funds case has ruled that the
Interior Department must provide a "full and accurate accounting, appraisal
and other relevant information" to Indian beneficiaries prior to
transactions concerning property held in trust for them by the federal

Royce C. Lamberth, federal district court judge for the District of
Columbia, signed his order on Sept. 29, pursuant to a restraining order of
Aug. 31 that halted planned trust land transactions by DOI, one day ahead
of the deadline for bids. In the court's eyes, the planned sale
transgressed an earlier ruling against communications between DOI
defendants and individual plaintiffs in the complex case.

According to the plaintiff class in the case, headed by lead plaintiff
Elouise Cobell, the Sept. 29 order marks a historic first - the first time
Interior and its subordinate department, the BIA, have had to account in
advance to Indian beneficiaries for the value of trust land transactions.
They contend that 40 million acres of land held in trust by the government
for Indians in the 19th century now amount to only 11 million acres in
trust, in part because of Interior property transaction practices that make
it impossible for trust beneficiaries to assess property value.

The land at issue is held in title by the federal government, but monies
derived from the land and its resources are dedicated to trust accounts
established by Congress in the name(s) of individual Indians.

Interior maintained through a spokesman that habitually for decades it has
notified trust beneficiaries of pending property transactions, and noted
that the transactions take place at the behest of beneficiaries.

But immediately after Lamberth's Sept. 29 decision, an episode occurred
that sparked his wrath and raised questions with him about Interior's
attitude toward Indians and the judicial system.

The episode was a memo, reported in the media, from Ross Swimmer,
Interior's special trustee for trust funds, to Interior trust offices in
Albuquerque, N.M. suggesting the department had been "blessed" with a court
order that might mean it could not communicate with trust beneficiaries,
conduct public meetings with them, or send checks to them for the money due
on royalties derived from their trust land holdings. The money would come
from accounts held by members of the plaintiff class. The full text of the
memo emphasized that further guidance would be available during the course
of the day (Sept. 29). At no point did the memo authorize withholding
checks, Swimmer said.

The core of Swimmer's argument was that Lamberth had earlier restricted the
department's communications with individual plaintiffs, and that the
court's current opinion states that "the beneficiaries should retain all or
most of their trust assets, in as unaltered a state as is practicable,
until Interior completes the required accounting" of the trust. This
so-called "freezing of the status quo" concerning all trust assets, not
just land, might extend to money assets in the accounts, Swimmer

Plaintiff attorneys got wind of the e-mailed memo and went to Lamberth on
Sept. 30 with a request for an emergency hearing "to prevent further
retaliation to individual Indian trust beneficiaries."

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In court on Oct. 1, according to an Associated Press report posted on the
Web site of the plaintiff class, Lamberth took umbrage at the Swimmer memo.
He called the interpretation behind it "a flat-out lie" designed to blame
the court for the withheld royalty checks, which beneficiaries rely on.
"Has Secretary Norton decided to declare war on the Indians in this
litigation?" he asked the Justice Department attorney representing Interior
and Secretary Gale Norton, adding in the AP account, "It comes across as
absolute, direct retaliation."

The attorney and Interior spokesman Dan Dubray denied any retaliatory
motive. The memo notwithstanding, they added in separate contexts - the
attorney to the judge and Dubray outside the courtroom - Norton has
directed that no checks be stopped.

At Interior's request, Lamberth ultimately altered his Sept. 29 order to
clarify that checks would not be affected. The court's new order
"categorically rejects the notion that there is a need to clarify its order
issued Sept. 29. However, because the requested clarification in no way
changes the substance or intended effect" of the first order, Lamberth
complied with Interior's request to the extent of stating that
communications between Interior defendants and Indian plaintiffs "related
to the sale, exchange, transfer or conversion of Indian trust land" may
take place, under certain restrictions pertinent to getting checks in the

Swimmer said, "My concern was ... where we stood with regard to any
disposition of assets ... At no time did I or anyone in the department
suggest ... that any checks would be stopped ... It is without question
that everyone in the department is geared to doing what is best for the
Indian trust beneficiaries."

He said that his reference to the "blessing" of the court's order was
"tongue-in-cheek," intending no disrespect. "This court is very, very
sincerely involved in getting this trust reformed. And I am too, and so is
the secretary."

The task of reform is so gigantic it will take the court, the department,
Congress and the presidential administration working together to get it
fixed, he said. "The message I send is 'I'm on the team' ... There has
never, ever, ever been a thought of retaliation."

In general, he added, the public may not fully appreciate the difficulty of
the trust reform challenge after 100 years of mistakes by the government
and many others, and so they don't fully accept that difficulties are going
to occur. He noted, for instance, that when Lamberth ordered the
disconnection of BIA and Interior connections to the Internet over lapses
in the security of the systems, many Indian people didn't get their trust
checks at the height of a holiday season, leading to a public uproar. "I
don't think the judge intended that" - rather, he was taking a bold step
toward reform. Neither did Interior intend it - given the pre-eminence of
the Internet in record keeping and information tracking nowadays, it took
Interior some time to shift back to a manual system.

Swimmer reiterated his view that Interior is making progress in its trust
reform efforts.

Lamberth has regularly sided with Indians in the case while excoriating
Interior for its conduct, both inside and outside the courtroom. He was the
subject of two attempts by Interior and individual defendants to remove him
from the case in September. He survived one of them when the U.S. Court of
Appeals for the D.C. circuit dismissed a motion against him by individual
defendants he has charged with contempt of court; and he seems to have the
upper hand in the other one as a three-judge appeals court panel showed
notable skepticism, in its questioning, that Interior can reform itself
without court oversight in the form of a "structural injunction" Lamberth
has filed against it.