FOR IMMEDIATE RELEASE May 30, 2001


INTERIOR AND TREASURY DROP
FURTHER APPEAL OF INDIAN TRUST VICTORY

Deadline Passes for Seeking Review by U.S. Supreme Court


WASHINGTON, D.C. - After fighting for five years and losing two landmark 
court battles against Indian plaintiffs seeking reform of the mismanaged 
individual Indian trust system, Treasury Secretary Paul O'Neill and 
Interior Secretary Gale Norton have let the deadline pass for asking 
the U.S. Supreme Court to review the issue further.

Lawyers for O'Neill and Norton had until the close of business on Friday,
 May 25 to file papers asking the Supreme Court to take up the case. 
The deadline marked 90 days since a three-judge panel of the U.S. Court 
of Appeals for the D.C. Circuit unanimously upheld a lower court's 
ruling in favor of the Indian plaintiffs.

"By losing the first time in the trial court, Interior and Treasury got 
a ruling that they were in breach of their obligations to the Indian 
trust beneficiaries," said Elouise Cobell, the lead plaintiff. "Then 
they turned around and appealed, and the appeals court slammed them 
again. Every time they've fought, they've lost. Every loss has made 
their position worse. Maybe the message is getting through."

The class action litigation, Cobell v. Norton, was filed in 1996 on 
behalf of approximately 500,000 individual Indian trust beneficiaries. 
After a nine-week trial, U.S. District Judge Royce C. Lamberth ruled for 
the Indians on Dec. 21, 1999, ordering reform of the grossly mismanaged 
trust. The Justice Department appealed the decision in January 2000, 
and the appellate panel handed down its unanimous ruling upholding 
Lamberth on Feb. 23 of this year.  

In their decisions - both landmarks in Indian trust law - the judges 
spoke in unusually blunt terms in describing the government's historic 
failure to account for billions of dollars belonging to Indian landowners 
throughout the western United States.

"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," said Lamberth. "It is 
fiscal and governmental irresponsibility in its purest form."

In its opinion, the U.S. appeals court panel stripped Treasury and 
Interior of the legal deference customarily shown to federal agencies 
and said, "The level of oversight proposed by the district court [over 
Interior and the Bureau of Indian Affairs] may well be in excess of that 
countenanced in the typical delay case, but so too is the magnitude of 
the government malfeasance and potential prejudice to the plaintiffs' 
class."

"Given the history of destruction of documents and loss of information 
necessary to conduct an historical accounting, the failure of the 
government to act could place anything approaching an adequate 
accounting beyond plaintiffs' reach. This fact, combined with the 
longstanding inability or unwillingness of government officials to 
discharge their fiduciary obligations, excuse court oversight that 
might be excessive in an ordinary case," the judges said.

Lamberth has imposed judicial oversight for at least five years over 
the failed trust system and appointed a Special Master to oversee the 
protection and preservation of relevant trust documents and records. 
In April, the judge went further, appointing a Court Monitor at Interior 
to report directly to the court on Secretary Norton's candor and her 
progress at trust reform. That action followed disclosure of a memo by 
a senior BIA official that acknowledged trust reform is "imploding" and 
is based on "wishful thinking and rosy projections."

Despite their legal defeats, government officials have yet to comply 
with court orders. Trust records continue to be destroyed and e-mails 
erased by the defendants and their counsel. In a surprise visit to the 
Office of Information Resource Management in Reston, Virginia, Special 
Master Alan Balaran found that trust documents have been shredded 
routinely by contractors - despite government assurances to the court 
that it had a special security plan in place and that no trust records 
were in danger.

A second trial to "re-state" the individual Indian trust - determine 
how much the Indian trust beneficiaries are owed by the government - is 
expected in the near future.

For more information, please visit http://www.indiantrust.com/

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