By ANN HINCH
Assistant Editor

WASHINGTON, D.C. — Time’s counting down for the chance of an out-of-court settlement between potentially tens of thousands of Native Americans and the USDA, for specific discrimination the plaintiffs allege took place between 1981-99.

Joseph Sellers of Cohen Milstein Sellers & Toll in Washington, D.C., lead counsel for the plaintiffs, said no trial date has been set for the Keepseagle et. al. vs. Vilsack case, which was filed in November 1999 in the U.S. District Court for the District of Columbia. Right now there’s a deadline that if the case is settled between the plaintiffs and the USDA to all parties’ satisfaction next month, no trial will be necessary.

Foremost, Sellers said the plaintiffs are seeking a change to the way USDA farm lending offices do business in making farm loans to and servicing existing loans of Native American farmers, “so that decisions are fair and that Native American applicants have an equal chance to obtain loans and debt servicing.”

“They really want their children and grandchildren to benefit from the loans and support the USDA was charged to provide,” he explained.

The plaintiffs are also seeking monetary damages, based on potential lost farm income from loans denied, as well as fiscal problems that Sellers said plagued Native farmers who were unable to refinance under reasonable terms when normal things went wrong (such as weather or crop disease) to impact the ability to repay.

“The evidence of discrimination was so widespread, there was a desire to at least get the case filed,” Sellers said, noting that Tex Hall – a well-known businessman and board chairman and CEO of the Inter-Tribal Economic Alliance – was at the forefront of Keepseagle.

Since then, the attorneys have been conducting discovery, the process of each side obtaining documents and testimony supporting their position. The plaintiffs allege Native farmers received only about half the loan money they were entitled under law, and were unable to renegotiate up to two-thirds of their existing loans – the same kind of “loan servicing” he said white farmers regularly enjoy.

Native farmers accumulated enormous debt because of this unwillingness to service the loans they had, Sellers said, and many were forced off their land, had to declare bankruptcy or still have loans where the interest exceeds the principal.

Finally, there’s also a component of non-economic monetary relief to the case – which means trying to put a dollar value on the emotional ripple effects of loan denial, such as problems that broke up families as a result, for example.

The claims of discrimination go back to 1981, Sellers said, because that’s when the Reagan administration closed the Civil Rights Office of the USDA, the office charged with receiving violations complaints. For more than a decade, he said there was “no reliable way” for someone to lodge a civil rights complaint from dealing with the USDA or its agencies (such as the Farm Service Agency).

In 1997, federal law only allowed plaintiffs filing a civil rights suit to go back a few years; that year, Congress updated the Equal Credit Opportunity Act to allow claims to go all the way back to 1981. The caveat was that a lawsuit had to be filed within two years – hence, Keepseagle filed in 1999.

This isn’t the first class action lawsuit for discrimination to follow the legislation. According to the National Congress of American Indians (NCAI), in 1999 the USDA reached a $1 billion-plus settlement with African-American plaintiffs in Pigford vs. Glickman. Last month, the NCAI said the USDA agreed to another $1.25 billion settlement with farmers who did not meet the filing deadline in time for the original settlement but were still considered eligible for relief.

Sellers said President Obama has asked Congress for this funding. In a letter to Vilsack and Attorney General Eric Holder, however, the NCAI stated a settlement in Keepseagle would not require Congressional approval because payouts could be administered from the Judgment Fund in the U.S. Department of Justice (DOJ).
While the alleged discrimination happened across the country, Sellers said it was probably most keenly felt in the Plains states because of higher populations of Native American farmers there. He said Natives represent perhaps 3 percent of the overall farming population in the United States; even so, calculating monetary claims at this point is difficult.

“There’s no easy way to add it all up and give an exact computation,” Sellers said, noting it hasn’t even been decided who else might be able to join in the case as a plaintiff if a settlement is reached (since it is a class action). “The court’s going to have to set some kind of standard for claims.”

However, Sellers’ firm does use an economist who worked for the USDA for several years, who helps with these estimates. He said the income losses from never-approved loans alone are probably at least $800 million. Census data shows there are only about half as many black farmers in the U.S. as Native American farmers – so looking at the Pigford case may prove helpful for a preliminary estimate.

As for the 11 years since Keepseagle was filed, he said discrimination problems have “gotten a little better, but there continue to be problems with the farm loan system.” He said individual loan decisions are often made at the county level, not national, and he feels it will take time to change attitudes and create a nationwide system with less bias.

Speaking earlier this month, Sellers said he believes Obama and USDA Secretary Tom Vilsack want to resolve this matter and “put behind them the decades of discrimination plaguing the USDA.” One reason, he said, is as a senator from Illinois, Obama advocated allowing late-claimants in the Pigford matter – often called Pigford II.

Calls and e-mails to the USDA for comment on this matter were not returned by press time. A Public Affairs spokesperson for the DOJ simply stated its officials “have no comment on the current discussions.”