Free Joint Status Report - District Court of Federal Claims - federal

Case 1:06-cv-00940-EJD

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS ) ) Plaintiff, ) ) v. ) ) THE UNITED STATES OF AMERICA, ) ) Defendant. ) ____________________________________) COEUR D'ALENE TRIBE,

Case No. 06-cv-00940 Chief Judge Edward J. Damich

SECOND JOINT STATUS REPORT Pursuant to the Court's February 22, 2007 Order, Dkt. No. 7, Plaintiff Coeur d'Alene Tribe ("Plaintiff" or "Tribe") and Defendant United States respectfully submit this Joint Status Report ("JSR"). Relevant Procedural History 1. As this Court is aware, Plaintiff filed this case on December 29, 2006. See

Complaint, Doc. 1. Also on December 29, 2006, Plaintiff filed a companion case for declaratory and injunctive relief in the United States District Court for the District of Columbia. Coeur d'Alene Tribe v. Kempthorne, No. 1:06-cv-02242-JR (D.D.C.) (hereinafter,"Companion Case"). Plaintiff makes allegations in both cases relating to the trust accounting and other trust duties and responsibilities allegedly owed by Defendant to Plaintiff. 2. On February 20, 2007, the parties filed in this case a Joint Motion for Temporary

Stay of Litigation. See Dkt. No. 6. In that Joint Motion, the parties noted that their counsel had conferred and agreed that (a) the trust mismanagement issues and claims raised by Plaintiff in this case are secondary, at this particular juncture, to the trust accounting issues and claims asserted by Plaintiff in the Companion Case; (b) the disposition of the issues and claims in the Companion Case would likely have a significant influence and impact on the disposition of

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issues and claims in this case; and (c) the outcome of an administrative accounting process currently under way between the Inter-Tribal Monitoring Association ("ITMA") and the Office of Historical Trust Accounting ("OHTA") of the United States Department of the Interior ("Interior" or "DOI") (in which process Plaintiff and six other Indian tribes are participating) might affect the issues and claims in this case. 3. The Court granted the Joint Motion on February 28, 2007. Dkt. 7. Pursuant to

the Court's Order, the second JSR is due October 12, 2007. Id. 4. In the Companion Case, Defendant filed on March 9, 2007, an Unopposed Motion

for Enlargement of Time Within Which to File Answer or Otherwise Respond to Complaint. See No. 1:06-cv-02242-JR (D.D.C.), Dkt. No. 6. The District Court granted Defendant's motion, and Defendant filed its answer in that case on June 11, 2007. See Dkt. No. 8. 5. Also in the Companion Case, at the direction of the District Court, Dkt. 9,

Defendant filed a motion on August 10, 2007, for remand of Plaintiff's trust accounting claims to the Interior Department, Dkt. 13. Pursuant to the Court's scheduling order dated August 23, 2007, Dkt. 23, Plaintiff joined certain other Tribes in filing a brief in opposition to Defendant's remand motion on October 1, 2007. Also under the order, Plaintiff has the opportunity to file a supplemental opposition brief on October 22, 2007. Id. Defendant's reply is due November 21, 2007. Id. At present, the Court has not scheduled oral argument on Defendant's motion. Relevant Factual Background 6. As previously described in the parties' first joint status report, ITMA is a national

Tribal consortium, the membership of which consists of more than 60 federally recognized Indian Tribes, including Plaintiff. ITMA's mission includes monitoring Defendant's trust reform efforts and providing a forum for Tribal consultation on trust issues.
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7.

In the 1990's, Defendant retained Arthur Andersen, LLP ("AA") to conduct a

Tribal trust fund account reconciliation project for each Indian tribe that had trust fund accounts open during the years 1972-1992. Plaintiff, among other Tribes, received various pieces of information as a result of the project, including (a) account statements listing the transactions in Tribal Trust Fund accounts for the 1972-1995 period (e.g., receipts, interest earnings, disbursements, balances, etc.) that related to Plaintiff; (b) a report describing the reconciliation procedures performed for certain of Plaintiff's account transactions during the 1972-1992 period and the results thereof; and (c) electronic images of source documents that supported certain 1972-1992 account transactions relating to Plaintiff. 8. Also as previously reported, ITMA and OHTA entered into a Cooperative

Agreement in December, 2004, to establish the Tribal Trust Fund Settlement Project ("TTFSP" or "Project"), a cooperative undertaking funded by OHTA to develop a methodology that could be used, among other things, to assist Defendant and the participating Tribes to reach agreement on the balances of the participating Tribes' trust fund accounts during the years covered by the Tribal trust fund account reconciliation reports. The main goals of the TTFSP are to provide Indian Tribes with a voluntary mechanism to determine the possibility of reaching settlement of certain Tribal trust fund-related issues and claims and to provide Tribes and Defendant with a framework for resolving broader trust-related issues. 9. The scope of the TTFSP is limited to the 1972-1992 period, i.e., the years covered

by the Tribal trust fund reconciliation project. (Nevertheless, ITMA and OHTA have expressed openness and receptivity to the possibility that, if the Tribal participants were satisfied with the outcome of the TTFSP, they might be able to agree upon an extrapolation or some form of

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adaptation of the TTFSP methodology and/or other information developed during the course of the Project to address other time periods or other types of trust-related claims.) 10. Plaintiff and six other Indian Tribes from across the United States have become

the pilot tribes for participating in the TTFSP. Under the Cooperative Agreement between ITMA and OHTA, the TTFSP has two phases. Phase I consists of developing a methodology for addressing the results of the Tribal trust fund reconciliation project in a manner agreeable to ITMA, the seven participating Tribes, and OHTA. Phase II consists of applying the Phase I methodology to one or more Tribes. 11. Under Phase I of the TTFSP, Defendant has provided ITMA, Plaintiff, and the

other participating Tribes) with the requisite Tribal trust fund reconciliation reports and the supporting documents. Also, ITMA has contracted with various experts, including forensic accountants and other professionals with experience working with Indian trust records, to advise ITMA and the participating Tribes about the TTFSP and, in particular, about the development of the Phase I methodology. Using the documents and data provided by OHTA, as well as other information from other sources, ITMA and OHTA have begun and are continuing the development of the Phase I methodology. Their efforts have included numerous meetings, multi-day work sessions, and other communications between ITMA, the participating Tribes (including Plaintiff), and OHTA. Further, ITMA and OHTA have been and continue to be formulating, reviewing, and providing comments on draft methodological approaches for examining receipts, disbursements, and investments, which are the major areas of inquiry proposed for the TTFSP. Additionally, ITMA and OHTA have extended the Cooperative Agreement into Fiscal Year 2008 and are working together to develop a more detailed plan and budget for proceeding with the TTFSP.
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12.

ITMA and OHTA have been and continue to be narrowing their differences and

addressing their issues and concerns with the proposed Phase I methodology. The parties remain committed to the TTFSP, and they continue to be hopeful and optimistic that they will be able to reach agreement on all of the elements of the Project in the near future. 13. As previously described, ITMA conducted a meeting on the TTFSP in Denver,

Colorado, on May 31, 2007, to provide information about the TTFSP to interested Tribes with pending trust accounting and trust mismanagement lawsuits against Defendant. As this Court is aware, there are presently 102 such cases pending in various Courts, including 56 cases in this Court. Representatives of ITMA, OHTA, the Solicitor's Office of the Interior Department, the Department of Justice, and various Indian tribes attended this meeting. Quanah Spencer, Plaintiff's designated representative to the TTFSP; Brian Gunn, Plaintiff's counsel; and Anthony P. Hoang, Defendant's counsel, were among those who attended the meeting. 14. Immediately after the ITMA meeting on May 31, 2007, Mr. Spencer and Mr.

Gunn met and conferred with Mr. Hoang on a number of matters related to the TTFSP, the Companion Case, and this case. 15. In follow-up to the May 31, 2007 meeting, the parties convened a meeting on

Plaintiff's reservation on October 8, 2007. Attending the meeting were members of Plaintiff's legislative and executive branches and Plaintiff's in-house and litigation counsel. Also attending the meeting were representatives of the Bureau of Indian Affairs, the Solicitor's Office, OHTA, OHTA's accounting consultants, and DOJ. One of the primary purposes of the meeting was for OHTA and its accounting consultants to conduct a detailed presentation to Plaintiff's officials and counsel about the analyses, findings, and results of the Tribal trust fund reconciliation report

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relating to Plaintiff. (As stated above, the reconciliation report serves as one of the bases for the TTFSP.) 16. After the presentation about the Tribal trust fund reconciliation project, Plaintiff's

representatives informed Defendant's representatives that Plaintiff would evaluate and determine about whether and how to proceed in light of the Tribal trust fund reconciliation project results. Thereafter, Plaintiff and Defendant discussed and agreed upon several matters, including the fact that the TTFSP represented a unique and beneficial opportunity for the parties to develop jointly and cooperatively a mutually acceptable mechanism for the possible resolution of the trust accounting and trust mismanagement issues and claims in the instant case and the Companion Case, without the need for protracted litigation. 17. Further, the parties discussed and agreed that they would aim to execute a joint

stipulation and proposed order to address such issues as the parties' participation in the TTFSP and the treatment of documents or communications generated as part of the TTFSP. In their capacities as counsel for the parties in another Tribal trust accounting and trust mismanagement case, Mr. Gunn, Mr. Hoang, and E. Kenneth Stegeby, undersigned Defendant's counsel, are currently negotiating the terms and conditions of such a joint stipulation and proposed order. The attorneys expect that, upon the successful completion of their negotiations in the other case, they will be able to adapt that document for use and proposal to the Court in this case. 18. Also, the parties discussed and agreed that they would aim to develop a process or

mechanism for Defendant to produce relevant documents and data informally to Plaintiff, upon informal request, which would assist Plaintiff in its participation in the TTFSP or otherwise address issues of concern to Plaintiff. To advance their joint development of this informal document and data production process, the parties agreed that they would negotiate a joint
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stipulation and proposed order to protect the confidentiality of certain documents and data to be provided by Defendant to Plaintiff in this case. Defendant's counsel agreed that they would prepare the first draft of the document and provide it to Plaintiff's counsel for consideration. 19. Based on the foregoing, the parties believe that they have made substantial

progress thus far but that more work needs to be done in order to advance the possible resolution, ideally through the TTFSP, of Plaintiff's trust accounting and trust mismanagement issues and claims, without the need for extended litigation. To that end, the parties agree that a continuation of the temporary stay of litigation in this case is warranted, especially given the parties' past, current, and projected future commitment of human and financial resources to the TTFSP and the pendency of 102 trust accounting and trust mismanagement cases in various courts, including 56 cases in this Court. Respectfully submitted this 12th day of October, 2007, RONALD J. TENPAS Acting Assistant Attorney General s/ John P. Racin, by s/ E. Kenneth Stegeby, pursuant to written permission provided on October 12, 2007 JOHN P. RACIN 1721 Lamont Street, N.W. Washington, D.C. 20010 Tel: (202) 265-2516 Fax: (202) 483-7895

s/ E. Kenneth Stegeby E. KENNETH STEGEBY United States Department of Justice Environment and Natural Resources Division P.O. Box 663 Washington, D.C. 20044-0663 Tel: (202) 616-4119 Fax: (202) 353-2021 Attorney of Record for Defendant OF COUNSEL: ANTHONY P. HOANG United States Department of Justice Environment and Natural Resources Division P.O. Box 663
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Attorney of Record for Plaintiff

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Washington, D.C. 20044-0663 Tel: (202) 305-0241 Fax: (202) 353-2021 MICHAEL BIANCO Office of the Solicitor United States Department of the Interior Washington, D.C. 20240 TERESA E. DAWSON Office of the Chief Counsel Financial Management Service United States Department of the Treasury Washington, D.C. 20227

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