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What Is Owed to Native Americans?
Judge Hopes to Settle Question in Suit Over Oil, Gas Royalties

By Del Quentin Wilber
Washington Post Staff Writer
Wednesday, June 11, 2008

A lawsuit over billions of dollars in royalties collected from oil and gas companies that leased Native American land has meandered through the court system for so long that a federal judge recently compared the case to Charles Dickens's "Bleak House," a tome about a long-running and convoluted legal dispute.

"The 'suit has, in course of time, become so complicated' that 'no two lawyers can talk about it for five minutes without coming to a total disagreement as to all the premises,' " U.S. District Judge James Robertson wrote in a long January opinion, using Dickens's words to describe the 12-year odyssey of Cobell v. Kempthorne.

On Monday, Robertson began overseeing what is expected to be a two-week-long bench trial in a contentious saga that has seen numerous legal twists and political turns worthy of Dickens.

Robertson is hoping to answer the last key question in the legal battle: How much money, if any, is owed to hundreds of thousands of Native Americans who sued over alleged improper management of the gas and oil royalties by the Interior Department over the last 121 years? The plaintiffs are seeking at least $58 billion, according to court records.

Government lawyers argue in court filings that the Interior Department should not have to pay anything because evidence shows that Native Americans have received all of the money they were owed. At most, only several hundred million dollars remains in dispute, they have argued.

To say the history of the trust accounts and the lawsuit "have been exhaustively chronicled," Robertson wrote in the January opinion, would "stretch the limits of understatement."

The lawsuit has generated more than 3,500 docket entries. Various orders and findings have been appealed, resulting in several opinions from courts of appeal. Over the years, three Cabinet secretaries were found in contempt of court by Royce C. Lamberth, the first federal judge to oversee the case.

In a rare action, an appeals court in 2006 removed Lamberth, who is now the District Court's chief judge, saying he was biased against the Interior Department, which he called "the morally and culturally oblivious hand-me-down of a disgracefully racist and imperialist government."

Elouise Cobell, a leader of the Blackfeet tribe in northwest Montana, filed the class-action lawsuit in 1996, seeking to force the Interior Department to account for billions of dollars in royalties from Indian lands held in trust by the government. The origins of the suit date back to 1887, when the government divided up millions of acres of Indian reservation land, parceled it out to individual Native Americans, but put the lots into trusts controlled by the Interior department.

On behalf of the Native Americans, the government then leased the land to oil, gas and other companies. Lawyers for the Native Americans allege that the government should have paid the Native Americans billions of dollars over the years.

The government has run into a lot of trouble trying to account for the money.

Many records are missing. Some are kept in different forms. Others were destroyed. And Congress did not allocate the money necessary -- estimated to be in the billions of dollars -- to perform an audit that might ultimately determine what happened to the funds.

In his 165-page January opinion, Robertson noted that it would be nearly impossible to figure out the difference between what the government collected from the leases and what it then paid out to the Native Americans over the years.

The government's own data suggested a potential gap of about $3 billion, according to Robertson, who expressed doubts that the government was actually trying to admit there was a shortfall.

"If the mysterious $3 billion shortfall . . . demonstrates anything, it is that even the broadest questions -- and therefore, the easiest questions to answer with statistical sampling -- do not seem to have been answered so far," Robertson wrote. He added that "there is little reason to be confident that answers are forthcoming."

Despite the lack of a thorough accounting, Robertson wrote that a resolution to the case is not hopeless. He said that a "remedy must be found for the Department's unrepaired, and irreparable, breach of its fiduciary duties over the last century."

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