Interior nears settlement of Indian Trust case

The prospect for a multibillion-dollar settlement of litigation over American Indian trust funds could spare the Interior Department from additional court-ordered shutoffs of its Internet links.

The long-running lawsuit, now known as Cobell vs. Kempthorne, today appeared much closer to settlement via an agreement brokered among plaintiffs led by banker and Blackfeet Nation member Eloise Cobell, Interior, and Sens. John McCain (R-Ariz.) and Byron Dorgan (D-N.D.).

Cobell today issued a statement that the plaintiffs are actively considering a settlement in the range of $8 billion.

The $8 billion settlement to be divided among the 500,000 beneficiaries of the Individual Indian Trust funds would be implemented by legislation under review in the negotiations.

Judge Royce Lamberth of the U.S. District Court for the District of Columbia repeatedly ordered Interior's Internet connections to be cut off to protect the integrity of the trust accounts.

Lamberth, who recently was removed from the case, issued the first Internet disconnection order to Interior in December 2001 when consultants hired by the court proved that they could easily hack into the trust accounts and change data without being detected by Interior's security systems.

Since then, Interior has wrestled with intensive court oversight of its systems security and with the threat of additional system disconnection orders.

The court gradually allowed Interior to reconnect most of its systems to the Internet. However, the Bureau of Indian Affairs home page today still reflects Lamberth's four-and-a-half-year-old order, stating:

"The BIA Web site as well as the BIA mail servers have been made temporarily unavailable due to the Cobell litigation. Please continue to check from time to time. We have no estimate on when authorization will be given to reactivate these sites."

Interior spokesman Shane Wolfe declined to discuss the specific amount of any possible settlement.

Wolfe added, "We have been working with senators McCain and Dorgan [on the settlement talks], who are working on a bipartisan basis on a legislative settlement. We have had many discussions with Indian Country, and we will continue our work and discussions."

Cobell's statement that the plaintiffs are considering an $8 billion settlement came in the form of a statement that denied unspecified reports that she viewed the monetary amount as "equitable."

"That is not what I said. That is not what I believe," Cobell said.

Cobell went on to cite the abuses that the trust beneficiaries have suffered at the hands of the federal government. The federal government itself admits that Interior and its predecessor agencies have lost track of vast sums since the Individual Indian Trust accounts were established by the General Allotment Act of 1887.

"Nonetheless, it would be foolish to ignore political realities while our people continue to go without the basic staples of life," Cobell said.

"That is why I and the other representative plaintiffs?in consultation with class members?are considering this settlement offer. We have not come to any conclusions," Cobell said. "Our deliberations are ongoing."

Some of the plaintiffs covered in the class action suit are extremely poor. Others plaintiffs are living in high-income areas such as the 90210 ZIP code area of Beverly Hills, Calif., the Upper East Side of Manhattan in New York or overseas, sources said.

Over the 10 years that the lawsuit has proceeded, discussions of the possible level of federal liability for lost or stolen trust funds have ranged up to $100 billion and higher.