IN THE UNITED STATES COURT OF APPEALS 
FOR THE DIST~CT OF COLUMBIA 

)ELOUISE PEPION COBELL, et al., ). 
Plaintiffs, 	))No. 08-8011. & )No. 08-~ 0/_.~ 
)
DIRK KEMPTHORNE, Secretary of the Interior, )Civ. No. 96-1285 et al., )(D.D.C.) (JR) Defendants. )) 
DEFENDANTS PETITION FOR LEAVE TO TAKE 
INTERLOCUTORY APPEAL AND 
RESPONSE TO PLAINTIFFS PETITION 

GREGORY. G. KATSAS 
Assistant Attorney General 
JEFFREY A. TAYLOR 

United States Attorney 
MICHAEL F. HERTZ 

Deputy Assistant Attorney General 
ROBERT E. KOPP 
MARK.B. STERN THOMAS M. BONDY ALISA B. KLEIN MARK R. FREEMAN SAMANTHA CHAIFETZ 
(202) 514-5089 
Attorneys, Appellate Staff 
Civil Division, Room, 7531 
Department of Justice 
950 Pennsylvania Ave., N.W. Washington, D.C. 20530 
INTRODUCTION AND SUMMARY 
A. Plaintiffs in this class action are present and former holders of money accounts held in trust for the benefit of individual Indians. In 1994, Congress enacted legislation requiring the Department of the Interior to account for the balances in these accounts which, at the time, totaled approximately $390 million. H.R. Rep. No. 103-778, at 9 (1994). Plaintiffs filed this lawsuit in 1996, seeking to compel an historical accounting of the accounts. In 2001, this Court held that the historical accounting had beenunreasonably delayed within the meaning of the Administrative Procedure Act (APA). In 2004 and 2005, this Court vacated injunctions that would have required accounting work. on a massive scale, explaining that the "general language" of the 1994 Act "doesnt support the inherently implausible inference that [Congress] intended to. order the bestimaginable accounting without regard to cost." 428 F.3d 1070, 1075 (D.c.Cir. 2005). 
The petitions now before this Court arise out of two rulings issued in 2008. In January, the district court declared that the .required accounting is an "impossible" task in light of what the court regarded, as inadequate congressional appropriations. 532 F. Supp. 2d 37, 39 (D.D.C. 2008). The court accep.tedas correct many of the parameters of the vacated, injunctions, although.it recognized that an accounting on this scale would cost billions of dollars and that Congress would not provide such appropriations. Id. at 81, 102.. Having defined the accounting on a scale that would never be funded, the district court concluded that the required accounting was thus "impossible~ to perform. Id. at 102. The court further reasoned that if the accounting was "impossible," it should devise "an appropriate remedy." Id. at 103. 
The court decided to award "restitution" to the class based on a statistically possible but unproven "shortfall" between receipts and disbursements over the 121year lifetime of the trusts. In August, the court, declared that the class as a whole is entitled to a"restitution" award of $455.6 million: 2008 WL 3155157 (D.D.C. 2008). The court recognized that "there has been essentially no direct evidence of funds in the government.s coffers that belonged in plaintiffs accounts," id. at * 14, .and that 
"an.accounting claim raised 121 years intothe trust wouldordinarily be prejudicially late," id. at *25, but believed that its approach was warranted by the 1994 Act,ibid. 
On September 4, the court issued an order declaring that the class is entitled to $455.6 million on the basis of the January and August opinions, and certified the order for interlocutory appeal under 28 U.S.C.  1292(b).. 
B. The certified .order is premised.on multiple errors, andimmediate review will materially advance the termination of this litigation. 
 First, the court erred in defining the required accounting in terms that are prohibitively expensive and declaring it "impossible" to implement. This Court held that the district court had abused its discretion when it ordered performance of an 
accounting costing billions of dollars. The district court could not properly reinstate 

many of the same parameters of the vacated injunctions and declare that such a multibillion dollar undertaking was required under the 1994 Act. 
Second,: the court compounded this error by concluding that it could award money as a result ofCongresss failure to fund a multi-billion dollar accounting. This is a suit to compel agency action unreasonably delayed. If the .required accounting is "impossible," there is no unreasonable delay and no basis for continuing. 
.jurisdiction. A court cannot declare an agencys delay is "unreasonable" without 
taking into account the resources available to the agency. Mashpee Wampanoag 
Tribal Council, Inc. v. Norton, 336 F.3d 1094, 1099-1102 (D.C. Cir. 2003). 
The APA does not permit a court to award money based on a determination that a statutory requirement is "impossible" to implementl The APA waives immunity in. an action .for relief other than money damages, including "a suit seeking to enforce 
[a]
 statutory mandate itself, which happens.to be one for the payment of money." DePartment of the ~ v. Blue Fox, Inc., 525 U.S. 2.5.5,262 (1999) (quoting Bowen 

v. 
Massachu.setts, 487 U.S. 879, 900 (1988)). The district court could not properly transform the 1994 Act into a mandate for the payment of money by declaring that its actual mandate is impossible to perform. 

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The absence of any statutory anchor is underscored by the nature of the district 

courts monetary remedy. Even assuming that an aggregate shortfall for a 121-year perio~d had been established, payment of that shortfall would not be a proper remedy for. failure to provide individual account statements on separate accounts for discrete periods of time to discrete individuals. Nor could the court properly convert this class action from a suit to compel the production of historical accountstatements into an suit for money. Class members hold (or held) discrete interests in monies deposited into individual trust accounts that were earned from disparate allotted lands and other assets, none of which were held in common for the class. 
In short, the "restitution" order is premised onfundamental legal errors. Immediate review will materially advancethe termination of the litigation by averting further proceedings premised on .the same errors. The controlling legal issues are: 
 1. Whether the district court erred in defining the required accounting in terms that are prohibitively expensive and declaring it "impossible" to perform. 
2. Whether the court lacked jurisdiction, authority, and record basis to issue the monetary award. 
 3. Whether the court lacked authority under, tile rules that govern class action. litigation t convert this lawsuit into an action .for money. 
C. Plaintiffs have filed a petition seeking leave to challenge the dollar amount 

of the monetary award. Standing alone, the petition would not meet the criteria of  1292(b). If the Court accepts the governments petition, however, we would not object to the Courts consideration of plaintiffs appellate issues as well. 
STATEMENT 

1. The 1994 Act 
The Department of the Interior administers trust money accounts on behalf of individual Indians. In 1994, Congress enacted the American Indian Trust Fund Management Reform Act, Pub. L. No. 103-412, 108 Stat. 4239, which requires the Secretary of the Interior to "account for the daily and annual balanceofall funds held in trust by the United States for the benefit of an Indian tribe or an individual Indian which are deposited or invested pursuant to" a 1938 statute dealing with investment of trust monies. 25 U.S.C..  4011(a). . 
In hearings preceding the 1994 Act, Congress found an array of problems in the administration of the individual Indian money (!IM) accounts. H.R., Rep: No. 102-499, at 10 (1992). However~ Congress also recognized the formidable.difficulty in accounting for funds derived from tiny land ownershipinterests that resulted when the interests were transferred from generation to generation, often under the laws of intestacy. I__d. at 27,28 & n.94. Congress noted estimates that it might cost $281. 
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million to $390 million to audit the IIM accounts and stressed that "[0]bviously, it makes little sense to spend so much when there was only $440 million deposited in the IIM trust fund for account holders as of September 30, 1991 ." Id. at 26. 
2. The accounting injunctions 
In 1996, a class of present and former IIM accountholders filed this lawsuit, claiming that the government had failed to provide a timely, adequate accounting. In 1998, the government moved to dismiss forlack of jurisdiction, urging that plaintiffs were seeking monetary relief not available under the APA. 30 F. Supp. 2d 24, 38-39 
(D.D.C. 1998). The district court denied the motion on the basis of class counsels 
representation that plaintiffs "only.seek an accounting,.not a cash infusion," id. at 40, and it struck allegations that could be read to seek a cash infusion, id. at 40 & n. 18. 
-This case has been before this Court on nine previous occasions. 455 F.3d 317, 318-20, 330-31 (D.C. Cir. 2006). In 2001, this Court held that Interiors performance of required historical accounting activities had been "unreasonably delayed" within 
the meaning of the APA. 240 F.3d 1081, .1108 (D.C. Cir, 2001). 
In 2003, the district court issued an injunction requiring Interior toundertake historical accounting activities on a massive scale, at a cost of more than $6 billion. 392 F.3d 461,466 (D.C. Cir. 2004). Congress responded with Pub. L..No. 108-108, 
which gave Interior temporary relief from ~ duty to engage in historical accounting 
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for the IIM accounts. Ibid. The conference committee "~reject[ed] the notion that in 

passingthe" 1994 Act "Congress had any intention of ordering an accounting on the scale of that which has now been ordered by the Court," and ~explained that "~ [s]uch an expansive and expensive undertaking would certainly have been judged to be a poor use of Federal and trust resources." Ibid. (quoting H.R. Conf. Rep.. 108-330, at 117, 118 (2003)). "Individual legislators said in effect that the disparity between the costs of the judicially ordered accounting, and the value of the funds to be accounted for, rendered the ordered accounting, as one senator put it, ~nuts." Ibid. 
This Court vacated the accounting injunction on the basis of Pub. L. No. 108
108. Id. at 468. When that legislation expired, the district.court.reissued the accounting injunction: This. Court again vacated the injunction, explaining that the language of the 1994 Act "doesnt support the inherently implausible inference that [C~ngress] intended to order the best imaginable accounting without ~regard to cost." 428 F.3d at 1075. "Nor does tlie Act have language, in any way appearing to grant courts the same discretion that an equity co~urt .would enjoy in dealing with a negligent trustee." Ibid. Congress was, after all, mandating an activity to be funded entirely at the taxpayers expense." Ibid. 

3. The impossibility ruling 

In January 2008, after a trial, the district court concludedthat "completion of the required accounting is an impossible task." 532 F. Supp. 2d at 39. In defining the scope of the required accounting, the court treated the reasoning of the courts earlier, vacated rulings as "presumptively correct," id. at 94 n.16, and reinstated many parameters of the vacated injunctions. For example, the court held that the accounting must include all IIM transactions over the lifetimeof the 121-year-old trusts, id. at 93-94, including transactions in accounts that were closed and probated before the passage of the 1994. Act, id. at 98. 
The district court recognized that its ,expanded historical accounting" would cost billions of dollars to implement, id. at 81; that Congress would not appropriate such funds, id. at 102; and; indeed, that Congress would he"nuts" to do so, ibid. The court nevertheless concluded that the expanded accounting was required by the 1994 Act. Ibid. Since Congress would not fund what the court called a "real accounting," the .court held that performance of the required accounting was "impossible." Ibid. 

4. The "restitution" ruling 
In August 2008, after another trial, the district court held that the class as a whole is entitled to a "restitution" award of $455,600,000, an award that, in the courts view, represents the aggregate amount of funds that were received into the 
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IIM trusts between 1887 and 2007 but that cannot now be proven to have been 

disbursed or credited to I1M accountholders. 2008 WL 3155157, at * 1-2 (D.D.C. 2008). The court recognized that "despite a profusion of evidence and opinion about the unreliability of IIM records, there has been essentially no direct evidence of funds in the governments coffers that belonged in plaintiffs~ accounts." Id. at * 14. It also recognized that "an accounting claim raised 121 years into the trust would ordinarily be prejudicially late," id. at *25, and that itis "hardly surprising" that the government 
"lacks reliable records back to 1.887," ibid. The court believed, however, that "the 1994 Act" allowed the class to demand an accounting of all transactions over the life of the trusts, ibid., and that its "impossibility~ ruling allowed it to shift to the government the burden of proving that IIM receipts were properly disbursed, id. at * 1 i, and to "credit[] all the uncertainty to the plaintiffs," id. at * 14. The court held that its "impossibility finding" raised "an evidentiary presumption in favor of the beneficiaries and against the trustee." Id. at * i8.1 
~ Thecourt also cited two :other bases, in addition to its impossibility ruling, for shifting the burden of proof to the government. First, the court cited what it characterized as "the governments, admission in the October 2007 trial that perhaps $3 billion of IIM system ieceipts had not been posted to IIM accounts." 2008 WL 3155157 at * 11. This Statementrefers to two exhibits that the court initially believed suggegt-ed a $3billion discrepancy between IIM receipts and disbursements. However, as the court itself recognized, that was not the "intended import of these exhibits," id. at *2, whose "collections" column included significant funds that were never destined for IIM accounts, id. at *2-4. Thus, the 
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The dollar amount of the courts award was based on the governments 

statistical model. That statistical analysis did not establish any "shortfalls" in IIM 
accounts; rather, it addressed uncertainty associated with missing data, and allowed 
the government to state a range of possible (but unproven) aggregate "shortfalls" with 
varying degrees of confidence. Using a 95% confidende interval, the range was 
"wide enough that it encompasses a zero difference between the calculated and stated 
balance of the trust, meaning that the curren.t, stated balance could very well be 
exactly correct." Id.at "13. At the other end. of the range, the 95% confidence 
interval encompassed a shortfall "of upto $365.7 million." Ibid: Using a 99% 
confidence interval, the range encompassed possible shortfalls between $0 and 
$455.6 million. Ibid. The court observed that "thevery large value that represents 
the .high end of the 99 percent confidence interval reflects the governments frank 
acknowledgment that uncertainty is not free." Id. at 14. "Crediting all the uncertainty to the plaintiffs,~ the court, adopted that "very large value" as its 
restitution award and declared that"the balance of the trust should be roughly double 
its current stated amount." Ibid: 
exhibits plainly were not an "admission" or evidence of any shortfall. Second, the court noted "plaintiff s presentation of at least a theorY that.some $4 billion of IIM funds had never been disbursed to IIM account holders." Id. at * 11..However, the court itse!f rejected this "theory" as ."uncorroborated by any other event or data," id. at *6, and based onnumerous methodological errors, id. at *7-9. 
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The court rejected plaintiffs alternative model for calculating restitution, observing that plaintiffs claimed shortfall of $4 billion is ."uncorroborated by any other event or data." Id. at *6. Among other errors, plaintiffs included in IIM "collections" categories of funds that were never destined for IIM accounts, idl at *7, such as "Osage headright" payments that were "collected into a tribal trust fund and disbursed from that fund directly to individual headrights owners, without ever passing through the IIM system." Id. at * 8. More broadly, "[i]nstead of providing unbiased opinions, plaintiffs expert witnesses~essentially provided plaintiffs with a way to put a dollar value on their argument that all data that favors the plaintiffs may be treated as admitted, and all data that disfavors them .must be proven by the government witl~ discrete, transactional evidence;" Id. at *9. The court rejected this. "super-strong" presumption, id. at *25, explaining that it would be "bizarre" to hold the taxpayers liable "for every transaction not proven" by an accounting method that is "not legally required" and that "would be irrational to pursue." Ibid. 
The court also rejected plaintiffs contention that, in addition to restitution, the court should order "disgorgement" of any asserted "benefit to the government" derived from withholding IIM funds..On plaintiffs theory, "every dollar of Treasury receipts that was intended for an IIM trust beneficiary but neither disbursed nor posted to an IIM account was a dollar the government did not need to borrow." Id.. 
at * 16. The court held that such an award would be outside its jurisdiction, id. at *2023, and, moreover, that plaintiffs "adduced no evidence that the Treasury ever decided to make an actual investment of IIM funds to the governments own benefit and produced no evidence of any decision not to borrow money on account of IIM funds." Id. at * 17, 20. The court likewise rejected plaintiffs demand for "interest," explaining that the demand is outside its jurisdiction and, moreover, that the provision plaintiffs invoked (25 U.S.C.  4012)was inapplicable. I__d. at "21-23. 

5. The 1292(b) certification 
The "restitution" ruling did not determine how the award would be distributed among class members and stated that entry of final judgment would have to "await a third proceeding" addressing issues Of distribution. Id. at *28. At an August 28 status conference, plaintiffs asked the district court to ente, r final judgment on the 
 money award so that they could take an immediate appeal to challenge the dollar amount. 8/28/08 Tr. 7-10. The court initially indicated that it would enter partial final judgment under Fed. R. Cir. P. 54(b), but the government submitted a brief explaining that the requirements of Rule 54(b) were not met. On September 4, the court issued an order declaring that the class is entitled to $455.6 million in "restitution" on the basis of the January and August opinions, and certified that order for interlocutory appeal under 28 U.S.C.  1.292(b). 
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ARGUMENT 

I. The Governments Petition 

The district court has certified for interlocutory, appeal its order awarding 
"restitution" on the basis of the January and August 2008 rulings. That order and the underlying rulings present controlling issues of law as. to which there is substantial ground for difference of opinion and whose resolution will materially advance the termination of the litigation, The decision to order !restitution" is premised on multiple, significant errors which can only be briefly summarized here. 
A linchpin of the "restitution" awardwas the courts determination that the accounting required by the 199~4 Act is "impossible" to implement. That ruling cannot be reconciled with this Courts decisions in this case. As this Court stressed, it is for the agency, not a court, to determine the scope of an accounting in the first instance, Because "neither congressional language nor COmmon law trust principles (once translated to this context) establish a definitivebalance between exactitude and 
cost," the court could not "displace[] Interior as the actor with primary responsibility for work[ing] out compliance with the broad statutory mandate.." 428 F.3d at 1076 (quoting Norton V. Southern Utah Wilderness Allianc.e, 542 U.S~ at 66-67). 
Moreover, even if the district court could properly assume the role of defining theparameters of the accounting, it could not properly conclude that Congress had 
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required performance of a multi-billion dollar undertaking along the lines of the 

accounting injunctions previously vacated by this Court. This Court held that it was an abuse .of discretion to require such an accounting and stressed that the "general language" of the 1994 Act "doesnt support the inherently implausible inference that [Congress] intended to order the best imaginable accounting without regard to cost." 428 F.3d at 1075. Plainly, the district court could not define the scope i~fthe required accounting in terms that are prohibitively expensive, declare it "impossible" to implement, and penalize the United States (and the taxpayers) for non-performance by issuing a monetary award. Congress does not subject the government to liability in this backhand fashion, and the monetary award finds no support in the 1994 Act or in the APA. 
Itthe accounting were indeed "impossible," it was not the role of the court to devise an alternative "remedy." This is a suit to compel agency action unreasonably delayed within the meaning of the APA. If the required action is "impossible," there isno action to compel and no unreasonable delay. Southern Utah, 542 U.S. at. 64 n.1. As this Court stressed in a similar contet, a court cannot declare an agencys delay "unreasonable" without taking into account the resources available to the agency. Mashpee Wampanoag Tribal Council, Inc. v. Norton, 336 F.3d 1094, 1099-1102 
(D.C. Cir. 2003). Interior has Spent more than $127 million onhistorical accounting 
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of IIM accounts. 532 F. Supp. 2d at 81. Absent a supportable finding of unreasonable delay, there is no basis for continuing jurisdiction and the case should be dismissed or remanded to the agency under settled administrative law principles. 
The APA does not authorize courts to develop alternative monetary remedies for delay in accomplishing impossible interpretations of statutory mandates and does not confer jurisdiction on district courts toorder monetary relief of its own devising. The district courts reliance on Bowen v. Massachusetts, 487 U.S. 879 (1988), only underscores the errors.in its analysis. As the court recognized, under Bowen., it could not order relief that .is ."a substitute for the accounting itself." ~2008 WL 3 t 55157 at 
* 17. But that is what tile court has done, by declaring the accounting "impossible" and then using the  "impossibility" ruling as the basis for a .monetary award. 
Under Bovcen., a court may order payment of money in "a suit seeking to enforce [a] statutory mandate itself, which happens to be one for the payment of money," Department of the Army v. Blue Fox, Inc.; 525 U.S. at 262 (quoting Bowen, 487 U.S. at 900). Bowen does not .allow a court to order monetary relief based on subjective "equitable" formulas when Congress fails to appropriate funds to satisfy the courts interpretation of a statutory mandate.  . 
The district court believed that it could "exercise jurisdiction over claims for breach of trust under the auspices of the APA," including trust duties derived from 
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"principles of equity and federal common law." 2008 WL 3155157 at "18: This Court, however, stressed that while the district court may look to common law to particularize a statutory obligation, 392 F.3d at 472, it cannot"abstract[] the common law duties from any statutory basis." Id. at 471. "Congress was, after all, mandating 
an activity to be funded entirely at the taxpayers expense." 428 F.3d at 1075. 
The "remedy" ordered by the district court has no basis in law and is manifestly not "restitution." The 1994 Act contemplates the furnishing of accountstatements 
to "individual" Indians for whom funds are held in trust. 25 U.S.C.  401 l(a). Interior has prepared account statements for a large number of accounts and its reconciliation work has not.shown significant errors. See, e , 532 F. Supp. 2d at 57, 61. (Interior reconciled all transactions in 83,226 judgment and per capita accounts); id. at 60, 62 (Interior reconciled 6,599 transactions from land-based accounts and foundonly a small number of errors). Indeed, as part ofits so2called "Paragraph 19" work, Interior examined all transactions in 37 accounts held by the named plaintiffs 
and tl~eir predecessors in interest - at a cost of $20 .million - and found only small variances. Id. at 49-50. 
As discussed above, the governments statistical analysis did not prove that there was any aggregate shortfall between IIM receipts and disbursements. But even if there were .such proof~ a money award based on the aggregate throughput of the 
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totality of all IIM accounts existing over more than 120 years would not be a proper 
remedy for an ostensible failure to provide adequate account statements for discrete 
IIM accounts, which are derived from different sources of revenue, held by discrete 
individuals, and held for discrete periods of time. Indeed, for this reason and because 
the award is not "restitution" in any generally accepted sense, no logical basis exists 
by which the award could be distributed, as the district court seemed to acknowledge. 
See.4/28/08 Tr. 13, 15-18, 73 (noting difficulties raised by "per capita" distribution). 
.~ For similar reasons, the court had no authority to convert this class action into 
a suit for money: The class was certified under Rule 23(b)(1)(A) & (b)(2) because class members had a common interest in compelling the production of historical account statements. But on the question 0f whether an account statement can be produced for any particular account, the interests and circumstances of class members diverge,. as one class member recently noted. See Exhibit 3, at 2 (August 30, 2008 letter from Eddie Jacobs, pro se, to class counsel) ("I understand why an accounting may be impossible for.all. IIM beneficiaries due to costs and/or lost and destroyed records, but an accounting is not impossible for me."). Nor do class members have  a common interest in the monetary award. Class members hold(or held) discrete 
interests in monies deposited into individual accounts that were earned from disparate 
allotted lands and .other assets, none of which were held in common for the class.. 
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In sum, the rulings that underlie the order awarding monetary relief rest on 

clear errors and are properly considered under this Courts  1292(b)jurisdiction. Immediate review will materially advance the termination of the litigation. It will obviate the need for the planned "third proceeding" to address the "appropriate allocation" of the monetary award among classmembers. 2008 WL 3155157 at ,28. In addition, it will clarify the governments historical acco.unting obligations and the role of the district court..It is plaintiffs position that the governments historical accounting obligations are unaltered by the "impossibility" ruling and "restitution" 
award, 8/28/08 Tr. 25-26, 28, and the district court has indicated that it will conduct further proceedings to address "ongoing.questions that have to do with historical statements of account, id. 30. Absent a substantiated finding of unreasonable delay, there is no basis for ongoing judicial supervision of Interior"s historical accounting 
activities. Any further proceedings premised on the district courts erroneous understanding of the scope of the required accounting will only delay the termination of this litigation. 
II. Plaintiffs Petition 
Plaintiffs have filed a petition challenging the dollar amount of the monetary award. Although their petition would not, standing alone, meet the requirements of  1292(b), this Court may conclude that it is efficient to consider both the 
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governments arguments and plaintiffs contentions at the same time, and we do not oppose this approach. We note, however, that there is no substantial ground for divergent opinion on the issues that plaintiffs raise. 
Plaintiffs petition abandons their "benefit to the government" theory and instead urges this Court to decide whether a claim for "interest" under25 U.S.C.  4012 would be within the district courts jurisdiction. Pet. 8, 15-17. But even assuming that there is jurisdiction to award interest, plaintiffs demand fails under the plain terms of  4012, which applies only to a claim for interest "on amounts 
deposited or invested" for an individual Indian "to the extent, that the claim is identified - (1) by a reconciliation process of individual Indian money accounts,. or. (2). by the individual and presented to the Secretary with supporting documentation, and is verified by the Secretary pursuant to the Departments policy for addressing accountholder losses." These requirements plainly have not been met here~ 
Plaintiffs also ask this Court to decide whether the district court erred in 
rejecting a"super-strong" evidentiary Presumption under which "government revenue data may be treated as sufficient evidence of receipts" but "every di;bursement must .be proven by a check or similar documentation of disbursement to a beneficiary.". 2008 WL 3155157 at *24. The district court was plainly correct to reject this presumption, which would "breathe new life into a gold,plated form of accounting" 
,19
that this Court"rejected as unduly burdensome, and that plaintiffs themselves have 

disclaimed." Id. at *25 (citing 428 F.3d at 1077-79). As the district court observed, 
it would be "bizarre" to hold thetaxpayers liable "for every transaction not proven" by an accounting method that is "not legally required" and that "would be irrational to pursue." Ibid. 
Although plaintiffs ask this Court to decide whether "Osage headright funds" should be a factor that drives the.dollar amount of the money award, the district court noted that this issue "may not be accessible"to this Court. 2008 WL 4151330 
(D.D.C. 2008). In any event, as the district court explained, it makes no sense to treat Osage headright payments as IIM "collections" because those payments were never destined, for IIM accounts. 2008 WL 3155157 at *7, 8; 4/28/08 Tr. 72-78. 
If this Court accepts plaintiffs petition, this Court~jurisdiction will include the antecedent questions of whether the award should be vacated or reduced. In addition to the threshold objections discussed above, the government also objected to the methodology used by the district court to arrive at its dollar amount, including but not limited to th~ decision to shift the burden, of proof to the government, to credit. all uncertainty to plaintiffs; and to select the high end of a 99% confidence interval.2 
2 Plaintiffs petitidn contains numerous inaccurate statements, which we have not addressed in light of space constraints. 
September. 18, 2008 

Respectfully submitted. 
GREGORY G. KATSAS Assistant Attorney General 
JEFFREY A. TAYLOR United States Attorney 
MICHAEL F. HERTZ Deputy Assistant Attorney General 
ROBERT E. KOPP MARK B. STERN  THOMAS M. BONDY ALISA B. KLEIN MARK R. FREEMAN SAMANTHA CHAIFETZ 
(202) 5145089 
Attorneys, Appellate Staff. 
Civil Division, Room, 7531 
Department of Justice 

950 Pennsylvania Ave., N.W. 
Washington, D.CI 20530 

CERTIFICATE AS TO PARTIES AND AMICI 

The named plaintiffs in this class action are Elouise Pepion Cobell; Earl Old Person; Penny. Cleghorn; Thomas Maulson; and James Louis Larose. The district court has certified a plaintiff class consisting of present and former beneficiaries of individual Indian money accounts, excluding those who had filed their own actions prior to the filing of the complaint in this case. 
Defendants are Dirk Kempthorne, as Secretary of the Interior; the Assistant Secretary of Interior-Indian Affairs; and Henry Paulson, as Secretary of Treasury. The Osage Nation is an intervenor that has appeared in the district court. 
Alisa B. Klein 
CERTIFICATE OF SERVICE 
I hereby certify that on this September 18, 2008, I caused the foregoing 
petition and accompanying exhibits to be sent to the Court and to the following by 
hand delivery: 

G. William Austin Wilson K. Pipestem 
Keith M. Harper Pipestem Law Firm, P.C. 
Kilpatrick Stockton, LLP 1333 New HampshireAvenue, N.W. 
607 14th Street, N.W., Suite 900 Washington, D.C. 20036 
.Washington, D.C. 20005 (202)419-3526 

(202) 508-5800 
Dennis Marc Gingold Merrill C. Godfrey 607 14th .Street, N.W., Akin Gump Strauss Hauer & Feld, LLP 9th Floor, Box6 1333 New Hampshire Avenue, N.W. Washington, D.C. 20005 Washington, D.C. 20036 
(202) 887-4000 
and to the following by federal express, overnight mail: 
Elliott H. Levitas 
Kilpatrick Stockton, LLP 
1100 Peachtree Street, Suite 2800 
Atlanta, GA 30309-4530 

(404) 815~6450. 
and to the following by first class regular mail: 
Earl Old Person (Pro se) 
Blackfeet Tribe  

P.O. Box 850 
Browning; MT59417 
Fax(406) 338-7530 

Alisa B. Klein 
IN THE UNITED STATES COURT OF APPEALS FOR THE DISTRICT OF COLUMBIA 
) 
ELOUISE PEPION COBELL, et al., ) 
Plaintiffs, ) 

) No. 08-8011  & 
v. ) No. 08-______ 
) 
DIRK KEMPTHORNE, Secretary of the Interior, ) Civ. No. 96-1285 
et al., ) (D.D.C.) (JR) 
Defendants. ) ________________________________________ ) 
EXHIBITS IN SUPPORT OF DEFENDANTS PETITION 
FOR LEAVE TO TAKE INTERLOCUTORY APPEAL 
AND RESPONSE TO PLAINTIFFS PETITION 

GREGORY G. KATSAS Assistant Attorney General 
JEFFREY A. TAYLOR United States Attorney 
MICHAEL F. HERTZ Deputy Assistant Attorney General 
ROBERT E. KOPP MARK B. STERN THOMAS M. BONDY ALISA B. KLEIN MARK R. FREEMAN SAMANTHA CHAIFETZ
 (202) 514-5089 Attorneys, Appellate Staff  Civil Division, Room, 7531  Department of Justice 950 Pennsylvania Ave., N.W. Washington, D.C. 20530 

Exhibit No.1 

  UNITED STATES DISTRICT COURT
  FOR THE DISTRICT OF COLUMBIA 

ELOUISE PEPION COBELL,  : Civil Action 96-1285  
et al.  :  
Plaintiffs  :  
:  
V.  : Washington, D.C.  
:  
DIRK KEMPTHORNE, Secretary  :  
of the  Interior, et al.  :  
:  
Defendants  : Thursday, August 28, 2008  

TRANSCRIPT OF STATUS HEARING 
BEFORE THE HONORABLE JAMES ROBERTSON
  UNITED STATES DISTRICT JUDGE 

APPEARANCES: 

For the Plaintiffs: 	DENNIS GINGOLD, ESQUIRE
LAW OFFICES OF DENNIS GINGOLD   
607 14th Street, NW 
Ninth Floor 
Washington, DC 20005 

(202) 824-1448 

ELLIOTT H. LEVITAS, ESQUIRE
WILLIAM E. DORRIS, ESQUIRE
KILPATRICK STOCKTON, L.L.P.
1100 Peachtree Street 
Suite 2800 
Atlanta, Georgia 30309-4530 

(404) 815-6450 

JUSTIN GUILDER, ESQUIRE   
KILPATRICK STOCKTON, L.L.P.
607 14th Street, N.W. 
Suite 900 
Washington, D.C. 20005 

(202) 585-0053 

Rebecca Stonestreet 	(202) 354-3249 kingreporter2@verizon.net 

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For the Defendants:  	ROBERT E. KIRSCHMAN, JR., ESQUIRE
JOHN WARSHAWSKY, ESQUIRE 
MICHAEL QUINN, ESQUIRE

U.S. Department of Justice
1100 L Street, N.W. 
Washington, D.C. 20005 

(202) 307-0010 

Court Reporter: 	REBECCA STONESTREET 
Official Court Reporter
Room 6511, U.S. Courthouse
333 Constitution Avenue, N.W. 
Washington, D.C. 20001 

(202) 354-3249 

Proceedings reported by machine shorthand, transcript produced 
by computer-aided transcription. 

Rebecca Stonestreet 	(202) 354-3249 kingreporter2@verizon.net 

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1  P R O C E E D I N G S  
2  COURTROOM DEPUTY:  This is civil action 96-1285,  
3  Elouise Cobell, et al. versus Dirk Kempthorne, et al. For the  
4  plaintiff we have Dennis Gingold and Elliott Levitas; for the  
defendants John Stemplewicz, John Warshawsky, Robert Kirschman,  
6  and Michael Quinn.   
7  THE COURT:  Good afternoon, everybody.  I called this  
8  status conference for a three-week period after I issued the  
9  opinion that you've all read and probably studied and some of  
you reacted to on August 7th.  I feel some need to begin this  
11  conference by re-emphasizing what I hoped was made very clear in  
12  the opinion that I issued three weeks ago, but which somehow has  
13  been either misconstrued or glossed over or misrepresented in  
14  the press.   
I didn't issue a damages award against the government.  
16  The amount of money that I find the government owes to the  
17  plaintiff class does not include, does not include most of the  
18  claims that I think comprise many of the grievances that Indian  
19  country has or thinks it has against the BIA. Income that was  
not collected is not included in my judgment; assets that may  
21  have been sold or leased below market is not included in my  
22  decision; funds that may have been stolen or misappropriated are  
23  not included in my opinion; any failure on the part of the  
24  government or Indian agents to enforce lease terms, not  
included; any money that may not have been paid on direct pay  
Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net  

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1  contracts, not included.   
2  This line between what is damages or what might be  
3  included in a claim by IIM accountholders for mismanagement,  
4  this line was carefully drawn on the very first day of the trial  
we had in October -- not in October, but whenever it was, by the  
6  plaintiffs' own witness, Professor Laycock, who was at some  
7  pains, as we have all been at some pains, to distinguish what  
8  this court can award from what this court cannot award.  
9  So whether or not the plaintiffs can recover for any of  
these things that I've just enumerated under the rubric of  
11  damages, I don't know.  I do know they can't recover it in this  
12  court.  And if there's going to be a recovery, it has to be, I  
13  think, in the Court of Federal Claims.  Whether it can be done  
14  as a class action, I don't know. Again, that's for another  
court and another case.  The plaintiffs made the decision to  
16  cabin their case very, very carefully so that they would not be  
17  seeking damages, which they knew they could not receive in this  
18  court.   
19  Now, I have to lay frankly at the feet of the  
plaintiffs the responsibility for hyping expectations about what  
21  might result from this case.  But $455.6 million is all I think  
22  I could possibly have awarded, and the government may take the  
23  position that that --even that was a stretch.  
24  The question now is where we go from here.  We have  
never resolved the class action questions that have been lurking  
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5  
1  around the edges of this matter, and what I hope we can have  
2  today is some discussion -and I think discussion is the right  
3  word for it, unless anybody has a position they want to advocate  
4  and argue - a discussion of the questions, of a number of  
questions that occur to me. And you may have others.   
6  One such question is, is it now time to prepare and  
7  issue the historical statements of account that the government  
8  has wanted me to authorize them to send for years, and wanted  
9  Judge Lamberth to authorize to send for years before that.   
How should the amount that I've concluded the  
11  government owes the IIM accountholders, how should it be  
12  allocated; per capita, equally per capita, as I think  
13  Mr. Gingold has recommended earlier? Is that the equitable way  
14  to distribute funds? Should the distribution be weighted for  
the age of IIM accounts or the size of IIM accounts or both, or  
16  is there some other way to allocate these funds?   
17  Should the class be notified of a proposed method of  
18  allocation by a notice to the class that would be sent to the  
19  23(b)(2) class? Rule 23 does contemplate the issuance of  
notices to the class in a (b)(2) class action.  
21  Obviously there will be a share of this recovery to  
22  which plaintiffs' counsel are entitled. Do I need a motion for  
23  that in a (b)(2) class action?   
24  Now, I want to hear where you-all are on these  
questions.  And I don't want to try to put my thumb on the scale  
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1  at all, but I do want to make this observation:  It seems to me,  
2  just because it seems like the most orderly way to do it, that  
3  there should be a period in which --it seems to me that there  
4  should be notice to the class. It seems to me that the parties  
should have time to either try to agree on what that notice  
6  would be, or if they can't agree, submit proposed forms of  
7  notice to the class. I don't know how much time that would be,  
8  a couple of weeks, 30 days.  
9  Then you get notice together, you send it out to the  
plaintiff class, you wait for responses, and somebody reads and  
11  analyzes and considers the responses.  We're talking about a  
12  couple of months, at least.  Then you're talking about some time  
13  period in which all of this is reduced to a final award or  
14  judgment.  I think as a practical matter it's not prudent to  
think that a final judgment on that kind a timetable could be  
16  issued much before the end of the year, if then.   
17  And the question that I frankly -- I just want to lay  
18  on the table, and you people may want to respond to it or not,  
19  the question is, if there are going to be appeals, and the  
plaintiff has indicated to the press that they're certainly  
21  going to appeal this, if there are going to be appeals, what's  
22  the point of waiting four months?  Maybe we should either  
23  certify the matter in some interlocutory way or issue a partial  
24  summary judgment under Rule 54(b).  Because otherwise, to take  
four months to sort out the details of how the money is to be  
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1  distributed just adds four months to the bottom line.   
2  So that, I think, is a brief outline of the  
3  discussion -I underscore the discussion - that I would like to  
4  have with the parties.  And I will hear from anybody who wants  
to stand up and speak about anything that he or she wants to  
6  speak about, I guess.  
7  Who's first?  Well, thank you very much.  It's been  
8  nice seeing you-all.   
9  MR. GINGOLD:  Your Honor, good afternoon.  
THE COURT:   Good afternoon, Mr. Gingold.  
11  MR. GINGOLD:  I would like to start with your last  
12  point first, since it is probably the most important point.   
13  Plaintiffs do intend to appeal, and we believe it would be more  
14  efficient for this court and better for the parties if the  
issues that remain unclear at least in plaintiffs' view be  
16  resolved by the appellate courts.  We believe it would be very  
17  difficult to fashion a clear and accurate notice to the class  
18  without first resolving many of the issues that exist with  
19  regard to, for example, interest, among other things, as to  
whether or not that's damages or specific relief.   
21  We think that the class should be informed as clearly  
22  and as comprehensively as possible as to what their rights are,  
23  as declared, and what their share is and how that share should  
24  be determined.   I think it is important to determine those  
issues, at least resolve those issues on appeal before we can  
Rebecca Stonestreet  (202) 354-3249  kingreporter2@verizon.net  

1  make those statements affirmatively --  
2  THE COURT:  How are you going to resolve those issues  
3  on appeal when they have never been resolved here?  
4  MR. GINGOLD: No.  For example, I think it makes an  
enormous difference if this is, in plaintiffs' view, a trust,  
6  and if, in plaintiffs' view, there are certain duties and  
7  responsibilities and there are certain proofs that are required,  
8  and burdens; it would make a significant difference with regard  
9  to potentially whether or not there's a pro rata or weighted  
share, whether or not, for example, the Osage, whose funds were  
11  deposited --the Osage individuals whose funds were deposited in  
12  the Osage Tribal Account prior to distribution are included; it  
13  would have an effect on the Osage individuals whose funds were  
14  deposited at some point in the 14X6039 account.   
The amount this court has stated clearly is an amount  
16  it has determined based on a model that we believe needs to be  
17  addressed on appeal. We don't believe that established, based  
18  on our understanding of the testimony, accurate account balances  
19  or funds that were not distributed.  And it all ties back to  
whatever the controlling law is as we understand it, this Court  
21  understands it, or an appellate Court understands it in this  
22  circuit and otherwise.  
23  And we think it would be -- this process is an  
24  expensive process.  We've done some -- we've had discussions in  
the interim period of time with professionals who do that for a  
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1  living. The nature and scope of the class itself is an issue,  
2  as this court has defined it in significant part in the  
3  January 30th, 2008 opinion; how the class is defined in  
4  accordance with the language of the class certification order  
very well determines the share of individuals.  
6  We would envision issues that were not addressed on  
7  appeal in the January 30th opinion to be also addressed in this  
8  regard, and without a complete resolution, we may have to do  
9  this process again.  And we think it would be more efficient and  
very --much less costly to only have to do this process once  
11  and finally.  
12  Quite frankly, given, as this court quite accurately  
13  noted, plaintiffs do intend to appeal, and if we prevail on  
14  perhaps any one of the major issues as we see it, it could  
dramatically change what was stated in the notice.  
16  THE COURT:  Sure.  Sure.   
17  MR. GINGOLD: Therefore, this case has gone on for over  
18  12 years, the trust is over 121 years old; whatever views are  
19  correct we believe need to be finally determined and  
expeditiously determined in order to finally resolve it, so  
21  we're not caught up in proceedings simultaneously in the claims  
22  court, in this court, in the Federal Circuit, in the DC Circuit.  
23  The efficiencies are important, the cost is very  
24  important, the reliance on whichever systems need to be relied  
on to even determine the beneficiaries -- and by the way, Your  
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Honor, I believe at least as of the most recent quarterly 
report, there are over 80,000 Whereabouts Unknown trust 
beneficiaries identified. How the class is defined will affect 
the ability to even deliver notice to the right people. 

We need these issues resolved. They are material 
issues. We understand and respect what this court has done. As 
this court knows from our pretrial submissions and also our 
posttrial submissions, we interpret things a great deal 
differently, and we would hope that we can accomplish what this 
court seeks, which is a fair and expeditious resolution, more 
appropriately if we can get the issues resolved on appeal first. 

There are so many issues we believe are necessary to 
provide a clear and accurate notice that they cannot be 
provided -- 

THE COURT:  So not to put too fine a point on it, what 
you want me to do is either by means of partial summary judgment 
or by means of a judgment that just -- a judgment that says the 
plaintiff class is entitled to $455.6 million, you want that put 
into appealable form and you want to leave all the rest of this 
stuff aside until you hear from the Court of Appeals. Is that 
right?  

MR. GINGOLD: You're absolutely right, Your Honor. 

THE COURT:  What says the government? 

MR. QUINN:  Good afternoon, Your Honor.  

THE COURT:  Good afternoon. 

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1  MR. QUINN:  I understand Mr. Gingold's comments just  
2  now, and empathize with the concern about going through the  
3  process of issuing notice and so forth.   
4  However, there have already been a fair number - in  
fact, I've lost number of the exact number - of appeals that  
6  have already gone up to the DC Circuit on this one case.  
7  THE COURT:  Nine I think is the last count.   
8  MR. QUINN:  I knew I needed at least two hands to count  
9  them, but I wasn't sure of the exact number.  And with the last  
appeal, the court urged this court, revisiting, remanding the  
11  case, to move forward with all due speed to resolve the case.  
12  I think there's a way that Your Honor could come to a  
13  final judgment without having to send a further piecemeal appeal  
14  up to the DC Circuit. I think, in fact, you could enter a final  
judgment that considers all these issues, distribution, who's in  
16  the class, what the attorney's fee -- if there's anything to be  
17  charged against the award, how that would be done. I think it  
18  would be less efficient, in essence, to send the case on a  
19  partial summary judgment, leaving all these issues unresolved.   
I heard Mr. Gingold say we want these issues resolved.  
21  I think it's better that the court address and resolve all these  
22  issues and enter a final judgment that reserves jurisdiction to  
23  administer and oversee distribution as whatever the court  
24  finally enters as the plan for distribution, and then take all  
those issues up.  

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12  
1  Taking plaintiffs' position, you could have the  
2  consequence of having an appeal go up, where in effect you are  
3  affirmed and it comes back and we go through the process of  
4  defining the distribution, and there's a further dispute and we  
wind up yet having another appeal because some of these  
6  remaining issues haven't been resolved now.   
7  I think it's in everyone's interest to try to come to  
8  the best final conclusion of the case, short of actually  
9  disbursing the money or going through the notice process, and  
making those determinations now, so that if there is a  
11  difference of opinion, the parties have an issue that's been  
12  decided by this court that could be incorporated with any appeal  
13  to the Circuit Court.  
14  THE COURT:  Well, we all have our own --we all bring  
our own ideas of what might happen here to the table.  My own  
16  view is that what really -- aside from the question of whether  
17  the Osage are in or out, which is not a small question, what the  
18  plaintiffs are most exorcised about is that this dollar has two  
19  fewer zeros than they wanted, and one fewer than they really  
thought they were entitled to, even without the interest and  
21  the -- or whatever --I'm happy to hear Mr. Gingold call this  
22  number interest. He was steering away from that number -- that  
23  word like crazy until today, but calling it what it sort of is,  
24  that's where the most dollars are.   
The next most dollars have to do with this whole burden  
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1  of proof question, and the third most dollars have to do with  
2  the Osage question.  I think when those three questions are  
3  resolved, there's not going to be a lot of nifnawing about  
4  notice to the class or who gets it or how it's sent out.  
I haven't heard the government say what their view is  
6  of this opinion. Are you going to defend it or cross appeal, or  
7  do you know?  
8  MR. QUINN:  I think in essence we were waiting to hear  
9  and see what exactly the plan -- how the plaintiffs would  
propose to bring this to resolution. There were seven things we  
11  were going to suggest that plaintiffs --that the court should  
12  ask the plaintiffs to brief as part of their proposal for  
13  distribution, and I could tick those off if you like.   
14  THE COURT:  Yeah, tick them off.  
MR. QUINN:  And then the government would respond to  
16  that proposal.   
17  The first would be addressing fees and expenses that  
18  may be charged against the award.  I think Your Honor, under  
19  Rule 23(h), to the extent there are any attorneys' fees that  
will be petitioned to the court that would come out of an award,  
21  Your Honor is required to give notice to the class with respect  
22  to any legal fee petition.  
23  Earlier in this case, on the first phase EAJA petition,  
24  where the fees weren't even coming out of plaintiffs' pocket but  
the fees were coming through the EAJA Act from the government,  
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1  Judge Lamberth ordered notice be issued with respect to that fee  
2  petition in accordance with Rule 23(h).   
3  So I think at a minimum, Your Honor will have to  
4  issue -- if there's going to be requests with respect to the  
award, Your Honor will be required to issue a notice to class.   
6  And then the question becomes what other kinds of notice would  
7  you include in that if you're going to issue anything to the  
8  class.   
9  As part of the written description, we would like to  
know from plaintiffs, for instance, in terms of what specific  
11  recovery will be given to the named plaintiff parties here. In  
12  some class actions there's certain additional awards that are  
13  given to named parties.  I don't know whether the plaintiffs  
14  considered that. They haven't indicated that at all.  I don't  
want to suggest that, but to the extent there's going to be any  
16  difference in payments between the named plaintiffs, the  
17  representative plaintiffs, and the class members, that ought to  
18  be made known.  
19  What if any - we've already addressed this - notice to  
class members would be distributed, what the wording of that  
21  notice would be, what the manner of distribution would be.   
22  Fourth, whether and the process by which class members  
23  could at all object.   
24  Five would be a final -- you know, what plaintiffs'  
final determination -- what their argument would be in terms of  
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finally determining who's in the class, class membership issues. 

Six would be a description about how the disbursement 
of the award would be distributed, the actual mechanics.  Would 
you hire an administrator, who would hold the money, how that 
would be accomplished, the time frames and so forth.  

And then seven, actually the physical aspects, if you 
will, about how the judgment would be distributed and how that 
would be accomplished. And we sort of envision that plaintiffs, 
obtaining the benefit of the award and representing the class 
members as a whole, would submit a written proposal, if you 
will, to the court on these and any other issues that they 
believe are germane for purposes of the award, and that the 
government would respond to those points that were of concern.  

THE COURT:  Well, two questions occur to me after what 
you've said. The first is whether any of those are questions 
that have to be decided now if the plaintiffs want to take an 
appeal. And the second, quite frankly, is which of those 
questions is a question in which the government actually has any 
interest?  I mean, the payment of the money would be by the 
government, but after that point I'm not sure the government has 
much skin in the question of the final determination of who's in 
the -- except, of course, that the government continues to be 
the fiduciary for all of the members of the plaintiff class, and 
so I suppose in its capacity as fiduciary, it continues to be 
interested in that.  

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16  
1  MR. QUINN:  Well, I agree with you. I think that's  
2  accurate, from a general perspective.  It's just that class  
3  action cases are all animals of a different color. They all  
4  have their own particularities about them, and the manner --the  
specifics, the things that would prompt concern by the  
6  government would be based upon what the specifics are of how  
7  this thing would be administered; how many years it would be  
8  open, how the costs are going to be borne, what kind of  
9  information demands would be made of the government.   
It's one thing if you are going to do a pro rata  
11  distribution, whether it's by number of accounts or by number of  
12  accountholders, and quite another if you're going to say, well,  
13  we're going to consider how long somebody has held an account or  
14  how much has gone through the account.  Because you could wind  
up putting information demands on the government that are close  
16  to if not equal or exceeding the cost of conducting the  
17  accounting itself.  I mean, you wind up going back to the same  
18  information sources to make those determinations.   
19  So we were requesting that the court direct the parties  
to brief these issues, asking plaintiffs to make their proposal,  
21  and that we would respond to those particular items that are of  
22  concern to the government, making suggestions on those points.   
23  Some points, as you mentioned, we wouldn't have any comment on  
24  one way or the other.  
But I think it's beneficial to all parties to have  
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17  
1  finality, to get to a judgment that can be appealed completely,  
2  short of actual execution of the notice and award of --  
3  distribution of funds.  
4  THE COURT:  Well, I indicated in the last line of the  
opinion I issued a few weeks ago that perhaps it would not be  
6  too much to suggest that the parties could have some offline  
7  discussion and settle this case.  I guess that was too much to  
8  expect and that's not happening.  
9  MR. QUINN:  There have been offline -- at your  
suggestion, Your Honor, there has been offline conversations  
11  between the parties. I haven't been privy to that conversation.  
12  If you would like to address those, I would ask Mr. Kirschman to  
13  come up.  
14  THE COURT:  Well, if there's anything anybody wants to  
tell me about it.  I mean, settlement discussions are by their  
16  nature very private. I don't want -- there's a lot of people in  
17  this courtroom. I don't want any of that to be spread on the  
18  public record.  If there have been discussions, more power to  
19  you.   
But I have to tell you that when I took this case on, I  
21  tried to make it very clear to everybody that one of my  
22  principal concerns was getting it done and getting it over with.  
23  And I'm still working on that project.  And from what you've  
24  said and from what Mr. Gingold has said, it seems to me that the  
most efficient use of my time and your time and the Court of  
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1  Appeals' time is to put this thing in a posture where it can be  
2  appealed right now.   
3  The question is exactly how to do that. I mean,  
4  Rule 54(b) -- there's Rule 54(b) and there's 1492(b).  One is an  
interlocutory appeal the other is an appeal from a partial  
6  judgment.  I don't know of any other way to get it to the Court  
7  of Appeals.  
8  MR. QUINN:  Not without a final judgment, Your Honor.   
9  THE COURT:  54(b) is a little problematical because it  
permits me to direct entry of final judgment as to one or more  
11  but fewer than all claims or parties.  This is a class action.   
12  If I just say the government owes the plaintiff class  
13  $455.6 million, so adjudged and decreed, that doesn't really --  
14  it actually doesn't even tee up the question that Mr. Gingold  
wants teed up, which is what about the Osage. It does, I think,  
16  tee up the question about interest. Can we all call it that  
17  shorthand?  Interest and the whole burden of proof question, the  
18  allocation of burdens.  
19  MR. QUINN:  Your Honor, if I may, there's one  
additional concern.  And we're going to address this at another  
21  juncture, but I think it's a factor here in terms of getting to  
22  a final judgment or whether you do something short of a final  
23  judgment at this point.   
24  And that is, there are certain orders in effect,  
interim orders that have been going on in place throughout this  
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1  case, that impose certain reporting duties on the department,  
2  some with trust reform aspects, fixing the system, that are for  
3  all intents and purposes over. That part of the case is over,  
4  yet those reporting obligations have continued.   
I think we would expect with a final judgment in place  
6  that the government would be relieved of those burdens. To the  
7  extent that those could be addressed short of final judgment,  
8  that might make a difference as well.  
9  But there are continuing burdens to leaving the case  
open and having any kind of further appeal short of a final  
11  judgment.  And I still think you can get to a quick judgment  
12  without going through the notice process, which seemed to be the  
13  primary concern, the costs of distributing a notice and so  
14  forth.   
THE COURT:  Yeah, I agree with you. I think we can  
16  clean up a lot of these housekeeping matters that have been  
17  running along for some time, status reports, quarterly reports,  
18  maybe even historical statements of account. Because as I  
19  understand Mr. Gingold, and I'm not surprised by what he says,  
again the main questions that drive the plaintiffs'  
21  dissatisfaction with this opinion are interest, whether they  
22  proved their $4 billion, and what do we do about the Osage. I  
23  think the rest of it is nickel-dime issues, relatively speaking.  
24  All right.  Thank you. Maybe it's time for me to hear  
from the plaintiffs again.  

Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net 

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1  MR. DORRIS: Good afternoon, Your Honor.  
2  THE COURT:  Good afternoon, sir.  
3  MR. DORRIS: We would request that the judgment be  
4  entered under 54(b). I believe that it can be fashioned along  
the lines that you're talking about in terms that the defendants  
6  are ordered to pay the amount to the plaintiff class, and then  
7  stay further proceedings regarding the distribution of those  
8  amounts until the appeals.  
9  Kind of a belt and suspenders approach would be to then  
also state that you would be granting interlocutory appeal with  
11  respect to any and all issues arising out of your two orders  
12  here, or your two opinions that you've issued, the one in  
13  January and now the one in August. And I think that that would  
14  clear up -- if there became an issue as to the extent to which  
that judgment was appealable, we would still be able to get up,  
16  get the issues heard, and back.  
17  The reason that the -- one of the reasons the plaintiff  
18  thinks it's important that the judgment be entered under 54(b)  
19  is that that would at least start the clock ticking on  
postjudgment interest. As the court is well aware, all of the  
21  calculations for that $455 million amount were through the end  
22  of fiscal year 2007, so it's been even a year since that has  
23  stopped.  So we would ask that the court do it in fashion that  
24  would at least get the postjudgment interest clock ticking on it  
as we move forward.   

Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net 

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1  I don't know that I need to address all of the seven  
2  issues that were listed, but I do want to say, because the court  
3  asked about a motion for fees and expenses, and under 23(h)(1),  
4  that is going to be done at a time when the court sets and asks  
the plaintiffs for that type of motion. Typically, and what we  
6  would think would be the most economical and efficient fashion,  
7  is that that's done in conjunction with -- when the case comes  
8  back down from the appeal, Your Honor, would be done as part of  
9  the same notice that goes out to the plaintiff class so that  
it's all done one time.   
11  That's a very expensive process, to provide notice  
12  certainly to this many plaintiffs, and we would ask that that be  
13  set by the court when it comes back down from appeal to be  
14  addressed all at the same time, so there's one single notice  
that goes out to the plaintiff class.  
16  I'm not sure if there's anything else, Your Honor, you  
17  would like me to address that's been brought up, but we'll be  
18  glad to try to do so.  
19  THE COURT:  No, I don't think so.   
MR. DORRIS: Thank you.   
21  THE COURT:  Yes, sir, good morning. Good afternoon.   
22  MR. KIRSCHMAN:  Good afternoon, Your Honor.  To the  
23  extent that we would be moving to a final judgment, there are  
24  issues, as Mr. Quinn indicated, that would assist us in being  
resolved, would close out the record.  

Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net 

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22  
1  One of those was the question you yourself raised  
2  regarding the HSA's.  A question Interior has that we have is  
3  not only regarding the HSA's that are presently before you that  
4  have been pending, but those that they have been preparing since  
we first addressed this issue. Work has continued, as we've  
6  told you, and those are on both the per capita and judgment  
7  accounts, and also more recently more modern land-based  
8  accounts.   
9  So a question we would like resolved, if we could, we  
would like to have answered, is what you view as Interior's  
11  responsibility to continue to prepare those for your  
12  consideration, those that are not yet before you.  And also,  
13  once final judgment is issued, what Interior's responsibilities  
14  regarding historical accounting are, at least for the time that  
your finding of impossibility is the law of the case.   
16  This is a question that's very significant because of  
17  funding and the allocation of resources, especially in light of,  
18  as you're well aware, the Tribal cases. But it's a question  
19  that burdens our client, because they have certainly continued  
with the accounting of the IIM accounts. They feel, we feel  
21  that there is a ruling under Cobell VI, an interpretation under  
22  Cobell VI that found a responsibility to do that under the  
23  '94 Act, but also too as trustee we face a question of  
24  impossibility.   
So that's an important issue for the Department of  
Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net  

23  
1  Interior, and it goes I think hand in hand with not only should  
2  we issue now the HSA's that have been before the court, but  
3  should we continue to follow the process that we have, provide  
4  you with notice of subsequent documents that have been prepared.  
Regarding any appeal or apparently a cross appeal, that  
6  is a subject that there's been no decision on.  It would  
7  ultimately be up to the Solicitor General's office to make such  
8  a decision. So that is something that's being considered, but  
9  certainly we can't represent today what that decision is or what  
issues could possibly be appealed.  It's a complex matter,  
11  obviously.   
12  So those are the issues I wanted to further raise with  
13  the court.  Thank you.  
14  MR. GINGOLD: Your Honor, with respect to the HSA's,  
there was no evidence regarding the HSA's that was introduced  
16  during the trial that was completed this June.  Issues were  
17  raised with regard to both the understanding of the description  
18  of what the HSA's were and the basis for the decisions that were  
19  made with regard to amounts estimated.  And Your Honor, I say  
estimated because the administrative record demonstrated there  
21  was debate among the contractors with regard to how issues were  
22  to be resolved on the HSA's, particularly, Your Honor, with  
23  regard to the allocation and computation of the compound  
24  interest that was reflected in the administrative record, and  
questions were raised substantially in that regard.  However,  
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24  
1  Your Honor, there was no evidence introduced during the trial  
2  that was completed in that regard.   
3  And Your Honor may recall, one of the issues that was  
4  involved - and we briefed this - was the HSA's were to be used  
as the basis to trigger an anticipated administrative process  
6  that would effectively require each beneficiary to present his  
7  information, to be able to challenge HSA's, when Your Honor, our  
8  clients have never been provided the information. That was one  
9  of the critical problems associated with the HSA's, in addition  
to the fact that the computation of interest remained a question  
11  mark that was not provided, and answers to which were not  
12  provided in the administrative record.   
13  So without the evidence introduced, Your Honor, we  
14  think it would be unfair and almost impossible for the  
individual members of the class whose funds are included in the  
16  judgment accounts to be put through a process where nothing has  
17  ever been provided to them that can be determined as verified or  
18  otherwise.  This court has noted in its January 30th, 2008  
19  opinion the difficulties that exist with regard to the records.  
Our clients are the beneficiaries, they're not the trustees, and  
21  they have not been provided this information, nor would they be  
22  in a position --because it would be done on an individual  
23  basis, nor would they be in a position to address the particular  
24  statements that would be given to them.   
I think, Your Honor, our clients would be put in an  
Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net  

1  impossible position to be able to challenge the HSA's, because  
2  there are time periods within which they would have to be  
3  challenged effectively or they are out of luck.  I don't think  
4  those issues, Your Honor, should be addressed at this point in  
time because the bigger issues have to be addressed first at the  
6  circuit which this court --  
7  THE COURT:  What's your reaction to the -- what's your  
8  response to the question of whether the government should  
9  continue to prepare and complete HSA's for land-based accounts  
and keep that whole process going?  Or just bag it, since I've  
11  said that it's impossible?  
12  MR. GINGOLD: Your Honor, there are two elements of the  
13  issue we're dealing with.  And as this court and the Court of  
14  Appeals has noted, the accounting --an accounting involves  
three components, the historical accounting, the current  
16  accounting, and future accountings.   
17  Your Honor, they have specific statutory duties with  
18  regard to accounting. Those statutory duties exist whether or  
19  not this litigation was ever brought.  They are trustees and  
they have the duty to do this, and Your Honor, they're paid  
21  significant fees by the beneficiaries to do this.  As this court  
22  may recall, evidence was introduced in the October trial from  
23  the administrative record that confirmed that eight to  
24  10 percent of all revenue generated by timber is paid to the  
government as fees, administrative fees, that out of the  

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26  
1  Agua Caliente or the Palm Springs agency office, leases -- there  
2  were lease schedules in place where in one case a $60,000 fee  
3  was paid as administrative fees.  
4  Your Honor, the government is obligated as a trustee to  
do this anyway. This trial is about a historical accounting.  
6  At the beginning of this case, for many years we sought reform  
7  of the systems to ensure that the current and future accountings  
8  could also be done properly, and it could not be done without  
9  adequate systems, staffing, and records. This court is well  
aware of how those have been resolved, but the Court of Appeals  
11  has never backed away from the fact that the obligation to do  
12  current and future accountings exists.   
13  So Your Honor, we believe the obligation exists.  We  
14  believe every trustee has that duty, and the government is not  
excluded.  In fact, Congress has reinforced that with the  
16  Trust Reform Act.  
17  But Your Honor, there are also damages issues that this  
18  court has raised.  The list that this court identified are  
19  damages issues, and we have never shied away from that and we  
were never dancing on the head of the pin.  We brought this  
21  action, as the Court of Appeals confirmed, to enforce the duties  
22  owed --the trust obligations owed by the United States  
23  government. That included an accounting, it included  
24  restitution, it included what we believe is also specific  
relief. That's an issue this court believes, with regard to  
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27  
1  interest, although it's provided by statute, is also damages.  
2  That issue needs to be addressed as quickly as possible  
3  at the Court of Appeals. The other damages issues, Your Honor,  
4  would have to be resolved properly either in the Court of  
Claims, or, if the Little Tucker Act is invoked, in this court  
6  as well.  
7  THE COURT:  By individuals?  
8  MR. GINGOLD: No.  Your Honor, the Little Tucker Act  
9  provides, and all the authorities are in accord, that where you  
have a class action, it's $10,000 apiece.  Subject to the Little  
11  Tucker Act, it's not $10,000 aggregate, it's $10,000 per member  
12  of the class.  
13  THE COURT:  Would that be a related case assigned to  
14  me?  
MR. GINGOLD: That could also be part of this case,  
16  Your Honor. If it was filed in this court separately --  
17  THE COURT:  No way, Mr. Gingold.  
18  MR. GINGOLD: I think Your Honor would not like to see  
19  us a lot more, so -- but Your Honor, I just wanted to point out,  
there are damages issues that can be addressed in this court, up  
21  to $10,000 per beneficiary, and Your Honor, if it's 500,000  
22  beneficiaries, that's $5 billion.  If it's other damages issues,  
23  such as the ones you identified, they're properly in the claims  
24  court.   
But Your Honor, we don't believe HSA's should go out,  
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28  
1  we don't believe any new processes should be triggered, we don't  
2  believe the government's accounting duties have been in any way  
3  suspended or should be suspended by a final judgment or by an  
4  interim order or by a certification for interlocutory appeal.  
Those obligations have existed prior to the '94 Act, and  
6  continue to exist and are reaffirmed explicitly.   
7  THE COURT:  Okay.  
8  MR. QUINN:  Your Honor?  
9  THE COURT:  Yes.  
MR. QUINN:  Let me just quickly -- just a couple of  
11  quick points in response to Mr. Gingold's comments just now.  
12  What we're referring to is just the historical  
13  accounting aspect, not the current accounting aspect.  We  
14  continue with those present current duties.  
But as it relates to this case, to the extent the case  
16  remains open and doesn't go to a final judgment, the faster it  
17  goes to a final judgment, the claim that was presented to this  
18  court for the historical accounting, and the findings of this  
19  court with respect to the historical accounting obligation, that  
issue, that claim becomes merged into any judgment that's  
21  entered by this court. And that would define the rights and  
22  obligations of the parties as adjudicated by this court.  
23  To the extent that the judgment -- no final judgment is  
24  entered, it leaves open these questions about the continuing  
historical obligation vis-a-vis this class of plaintiffs.  I  
Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net  

29  
1  think if the plaintiffs ask for a historical accounting, the  
2  court has ruled as a matter of law it's impossible.  If you  
3  conclude that case and essentially made an order with respect to  
4  $456 million in terms of a finding, that resolves the matter  
between the parties as to the historical accounting aspects for  
6  purposes of rendering that accounting.   
7  But as long as the judgment remains open, we continue  
8  to have these issues about, as an ongoing basis, to go back and  
9  continue to do the accounting.  
THE COURT:  Are you telling me the government wants to  
11  stop preparing historical statements of account for land-based  
12  accounts?   
13  MR. QUINN:  We would like to know whether we need to  
14  continue to do so.  I think it's the lack of certainty. When  
members of the department go up to ask and make appropriations  
16  requests on the Hill, there are always competing obligations and  
17  they get asked to justify the request.   
18  THE COURT:  All right.  Here's what I think we ought to  
19  do. And I'm going to need some agreement from the parties, if  
that's possible, to get there.   
21  I think I should put this case in a posture as soon as  
22  possible, as soon as next week, so that the plaintiffs have  
23  something that they can appeal if they want to appeal it.  I  
24  think the plaintiffs are right that that's Rule 54(b). I don't  
think it's too hard to form an order that qualifies as a final  
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30  
1  judgment under Rule 54(b) that permits -- that leaves open  
2  issues of administration of the plaintiff class, attorneys'  
3  fees, and so forth.   
4  I invite either or both parties to present me with  
forms of order that they think will satisfy that responsibility  
6  or those requirements. And, as I said, I think we can get this  
7  entered by the end of next week, so when I say invite forms of  
8  orders, I think you better get something in my hands no later  
9  than Wednesday.   
But there are ongoing questions that have to do with  
11  historical statements of account, that have to do with quarterly  
12  status reports, that have to do with I don't know what else, but  
13  what I would like to have from the parties is the agreement that  
14  my jurisdiction to deal with those matters is not terminated or  
ousted by the pendency of an appeal.  
16  In other words, we can run on two tracks.  We can deal  
17  with --and I don't think it is -- I think an appeal of the  
18  basic underlying obligation to pay does not stop everything in  
19  this court. That's my belief anyway, but I would be much more  
comfortable if the parties would both recite their agreement to  
21  that so that we can deal with this HSA question and other  
22  related questions on a more deliberate basis with maybe written  
23  motions or written requests and I can sort them out.  I'm not  
24  going to sort them out here in this courtroom this afternoon.  
And I don't want to stop the music while we have a  
Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net  

31  
1  round of motions to deal with them, either.  Because I do think  
2  the most efficient way to get this case to the finish line is if  
3  it's going to be appealed - and I'm not surprised that it will  
4  be - is to get that started as soon as possible.  Let the clock  
start ticking, and Mr. Gingold makes a correct point about  
6  postjudgment interest as well.   
7  MR. DORRIS: Your Honor, on behalf of plaintiffs, we  
8  would agree to what you've just proposed in terms of your  
9  jurisdiction.  
THE COURT:  Government okay with that?   
11  MR. KIRSCHMAN:  I will have to address it with others.  
12  I'm sorry, I can't answer that right now.  We will have a quick  
13  answer for you, but I can't address it standing here.   
14  THE COURT:  All right.  I'll have a quick answer in a  
few days, and by the middle of next week you'll tell me. I  
16  think I have the jurisdiction to deal with these housekeeping  
17  matters even if the underlying case is on appeal anyway, but if  
18  you have a different view, let me know and let me know why.   
19  So we have sort of a plan here: Proposed forms of  
order or judgment by the middle of next week, something entered  
21  by the end of next week, and unless I'm convinced that I don't  
22  have any jurisdiction to do otherwise, then we'll deal with this  
23  HSA question in a more deliberate fashion by renewed motions or  
24  whatever you want to present to me.   
Anything else today, counsel?  Thank you very much.  
Rebecca Stonestreet (202) 354-3249 kingreporter2@verizon.net  

1 

We're adjourned. 
2 

(Proceedings adjourned at 4:01 p.m.) 
3 
4 

6 

CERTIFICATE OF OFFICIAL COURT REPORTER 
7 
8 

I, Rebecca Stonestreet, certify that the foregoing is a 

9 

correct transcript from the record of proceedings in the 

above-entitled matter. 
11 
12 
13 
14 

SIGNATURE OF COURT REPORTER 
16 
17 
18 
19 

21 
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24 

DATE 

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Exhibit No.2 

Page 1
 UNITED STATES DISTRICT COURT
 FOR THE DISTRICT OF COLUMBIA

 ELOUISE PEPION COBELL,  :  Civil Action 96-1285 
 et al.  : 
 Plaintiffs  : 
 :  Washington, D.C. 
V.  :  Monday, April 28, 2008 
: 
 DIRK KEMPTHORNE,  Secretary  : 
 of the  Interior, et al.  : 
 :  10:00 a.m. 
 Defendants  : 

 TRANSCRIPT OF STATUS CONFERENCE BEFORE THE HONORABLE JAMES ROBERTSON
 UNITED STATES DISTRICT JUDGE APPEARANCES: For the Plaintiffs: DENNIS GINGOLD, ESQUIRE
LAW OFFICES OF DENNIS GINGOLD 607 14th Street, NWNinth Floor Washington, DC 20005
(202) 824-1448
 ELLIOTT H. LEVITAS, ESQUIREWILLIAM E. DORRIS, ESQUIREKILPATRICK STOCKTON, L.L.P.1100 Peachtree Street Suite 2800 Atlanta, Georgia 30309-4530
 (404) 815-6450
 KEITH HARPER, ESQUIREJUSTIN GUILDER, ESQUIREKILPATRICK STOCKTON, L.L.P.607 14th Street, N.W.Suite 900 Washington, D.C. 20005
 (202) 585-0053
 DAVID C. SMITH, ESQUIREDANIEL R. TAYLOR, JR., ESQUIREKILPATRICK STOCKTON, L.L.P.1001 West Fourth Street Winston-Salem, North Carolina 27101
 (336) 607-7392 
Elouise Pepion Cobell, et al. vs.  CA 96-1285 April 28, 2008 
Dirk Kempthorne, et al.  
Page 2  
For the Defendants:  ROBERT E. KIRSCHMAN, JR., ESQUIRE 
JOHN WARSHAWSKY, ESQUIRE 
MICHAEL QUINN, ESQUIRE 
JOHN J. SIEMIETKOWSKI, ESQUIRE 
U.S. Department of Justice 
1100 L Street, N.W. 
Washington, D.C. 20005 
 (202) 307-0010 
 JOHN STEMPLEWICZ, ESQUIRE 
Senior Trial Attorney 
 U.S. Department of Justice 
 Commercial Litigation Branch 
 Civil Division 
 Ben Franklin Station 
 P.O. Box 975 
 Washington, D.C. 20044 
 (202) 307-1104  
Court Reporter:  REBECCA STONESTREET 
 Official Court Reporter 
 Room 6511, U.S. Courthouse 
 333 Constitution Avenue, N.W. 
 Washington, D.C. 20001 
 (202) 354-3249  

Proceedings reported by machine shorthand, transcript produced by computer-aided transcription. 
Page 3 
1 P R O C E E D I N G S 2 COURTROOM DEPUTY: This is Civil Action Number 96-1285, 3 Cobell, et al. versus Gover, et al. 4 THE COURT: Counsel, as you stand to speak, state your 5 names for the court reporter. I won't enter appearances for 6 everybody at the beginning of this procedure. Some of you are 7 well-known to me, most of you are well-known to me. 8 We are here by prearrangement to talk about what might 9 be accomplished at another trial in this case, which I have set 
10 for June 9th. And I have received something like 250 pages of 11 briefing from the parties, exclusive of appendices, attachments, 12 additions, reference materials, and so forth, which I and my 13 clerks have done our best to internalize. 14 And I understand that there are -- there is on the part 15 of the government enormous continued resistance to the very 16 idea, A, of having another trial, and B, of any remedy in this 17 case that has a dollar sign in front of it. And I understand on 18 the part of the plaintiffs that there are considerably more 19 zeros after the dollar sign than the government thinks is 20 possible, or frankly than I think is possible. 21 And the tent flap having been lifted by my order in 22 January, the plaintiffs are now asking me to -- I think they're 23 asking me to sweep into the remedy in this phase of the case all 24 kinds of things that I had thought were reserved to the 25 so-called management part of the case, which we haven't even 
Page 4 
1 begun to hear or contemplate. 2 To my way of thinking -- well, here's where I am today: 3 I have accepted provisionally -- I mean, I don't doubt the 4 ability, nor deny the right, of the parties to give me 300 more 5 pages of briefs on this question. But I accept provisionally 6 the major premise of the plaintiffs' case that what cannot be 7 accounted for must be replaced. 8 But I have also accepted the government's modalities of 9 accounting, which I don't mean to get a cheap laugh out of this, 
10 but it's sort of close-enough-for-government-work theory of 11 accounting that the government and the Court of Appeals, by the 12 way, have decreed. 13 But as I found in January, that accounting doesn't 14 account for everything. In my January ruling I was critical of 15 what I considered the lackluster attention of both sides to the 16 question of how much cannot be accounted for. I thought from 17 the evidence at the last proceeding that the number was in the 18 vicinity of 3.6 billion, or 3 billion dollars; now the 19 plaintiffs have ratcheted that up to four and a half billion 20 dollars, I think principally by adding the Osage headrights 21 money, an arguable but I think questionable proposition. 22 With respect to both sides, I really don't want to hear 23 argument today about sovereign immunity, about jurisdiction, 24 about supremacy clause, about lots of the frankly ancillary 25 arguments that were in the briefs of both sides. 
Page 5 
1 What I am interested in, I think, are four basic 2 questions. The first is a question that I raised the last time 3 we were together that I don't think I have yet grasped the 4 answer to, and that is what I call the class certification 5 problem. Another way of putting that is to ask, if relief is 6 granted under a 23(b)(2) theory or a 23(b)(1) theory, what 7 further relief is precluded for class members who are bound by 8 that judgment? What is the claim-preclusive effect of a ruling, 9 and what is Eddie Jacobs and others like Eddie Jacobs going to 
10 do? 11 The second major question which is raised in the 12 defendants' brief and really not responded to by the plaintiffs 13 is if there is an award with a dollar sign in front of it -- I 14 refuse to call it either damages or restitution or disgorgement. 15 Let's just call it an award with a dollar sign in front of it. 16 If there's an award with a dollar sign in front of it, who does 17 the money go to? How is it distributed? 18 There is sort of the suggestion in the plaintiffs' 19 brief that it would be just distributed pro rata, which makes 20 very little sense to me. But the complications of figuring out 21 who would get what share of what amount of money are quite 22 serious problems, it seems to me. 23 The third question relates to the time value of money, 24 which is either prejudgment interest or not. And if it is, I 25 have no jurisdiction; if it's not, it's something else. The 
Page 6 
1 plaintiffs have unearthed a very interesting decision by 
2 Judge Boggs sitting in the 9th Circuit, concluding that the time 
3 value of money improperly forfeited or seized in forfeiture is 
4 not interest -- I mean -- yeah, is not prejudgment interest. 
5 And I haven't come down on one side or another of that 
6 issue, but before I even begin to come down on that issue, I 
7 need to think about and counsel need to advise me about some of 
8 the complexities that Judge Boggs noted in his opinion. Exactly 
9 how is it calculated? Exactly how is the money booked? Where 10 was it booked? As one of my law clerks has pointed out to me, 11 during many of the years in question in this case, the United 12 States didn't have any debt, so what's the debt-servicing idea 13 here for years in which the United States was not borrowing 14 money? And, of course, the methodology of just allocating some 15 of any reward per year is certainly simple, but I might add the 16 word "istic" after the word simple. 17 So the time value of money problem is a serious problem 18 and one that I would think needs to be addressed in considerable 19 detail. 20 And finally, of course, what numbers follow the dollar 21 sign? What is the amount of the award? I used numbers of three 22 million and 3.6 million -- billion, excuse me. Three billion 23 and 3.6 billion in the January findings, but was frankly quite 24 critical of those numbers. And the government, of course, is 25 critical of those numbers. The plaintiff is happy with those 
Page 7 1 numbers, or at least accepts those numbers, and wants to move on 2 from there by adding the time value of money to them. 3 But I do not consider that those numbers are -- I don't 4 think we're finished with that question, let's put it that way. 5 I don't think we're finished with that question at all. 6 Now, I have lots of other questions on my mind this 7 morning, but those are the major ones, class certification, how 8 is the money distributed, what about the time value of money, 9 and what is the amount of the award. And I would like to hear 
10 from counsel on any of those four subjects, and if you have to 11 slip over into some other subject, okay, but frankly, I think 12 that's about all we have time to talk about in any serious 13 detail this morning. 14 Who goes first? Mr. Smith? 15 MR. SMITH: Good morning, Your Honor. David Smith 16 representing the plaintiffs. 17 You know, I'll focus on the first two issues that you 18 noted. Number one, the class certification problem if relief is 19 granted; what about the preclusive effect for any other actions 20 that may be brought, such as Mr. Jacobs. And number two, to 21 whom does the money go to. 22 Your Honor, addressing that first issue, a lot depends 23 on what the damage claim might be. There are certain damage 24 claims that certainly this Court, in various opinions, has 25 determined is not covered by this action. If the damage action 
Page 8 1 is a failure to collect, I believe you said that's not within 2 the scope of this particular proceeding at this time. Certainly 3 that claim could have been brought in the claims court. If 4 there are certain mismanagement issues, those claims would not 5 be precluded. 6 The fact of the matter is that any individual 7 beneficiary could at any point have brought a damage action in 8 the court of claims if they felt it was possible. To our 9 knowledge, that has not happened during the course of this 
10 litigation. The defendants certainly would be more aware of 11 that than we would because they would be the ones being sued. 12 So to our knowledge, certainly Mr. Jacobs hasn't filed 13 such an action, and we're not aware at this point of anybody 14 else who has. 15 The practical matter is, Your Honor, that given the 16 failure of accounting, that would be an impossible task. If 17 you're sitting here with money that's been placed into a 18 commingled account, nobody knows what the beginning account 19 balances are, there's -- without that accounting, nobody can go 20 and determine what their individual loss may be. 21 So as a practical matter, that remedy is not even 22 available for any plaintiff. Nobody can go over into the court 23 of claims and say, you know, based on this accounting, I've lost 24 this amount of money. So that possibility is really not a 25 reality, in our opinion. Could at some point someone try to do 
Page 9 
1 it, to go into the court of claims? Obviously that's a 2 possibility that a judge in that jurisdiction would have to 3 consider. 4 Your Honor, if this Court applied all the assumptions, 5 all the presumptions that a court of equity can in dealing with 6 a trust, giving every benefit of the doubt to the plaintiffs in 7 applying those trust principles, making the government go 8 through its proof of showing every disbursement, certainly I 9 could see the possibility that it would be precluded, any other 
10 damage claim would be precluded. But as I understand from the 11 Court's ruling, that in fact is not what this Court is going to 12 do at this point. 13 Your Honor, the cases are not in agreement as to 14 whether a claim like this, dealing with equitable disgorgement, 15 what effect it may have on a damage claim, even if it was 16 possible. There are some cases that say you have to make an 17 election of remedies, there are some cases that say you give a 18 credit for anything you obtain in equity. Some cases you can 19 say you can do both. The cases certainly are not on agreement 20 on that point. 21 But it's our position that it really makes no 22 difference because it's not even possible. There's no 23 beneficiary of which we are aware who has had the advantage of 24 accounting to determine what individual losses may be. We don't 25 believe Mr. Jacobs or anybody else can do that. If the 
Page 10 1 government had done that accounting, certainly that would be a 2 possibility. But it's not here. 3 So I don't think that's a concern, that any individual 4 plaintiff will actually attempt to do that under these 5 circumstances. 6 Your Honor, looking at the -7 THE COURT: Your argument triggers a subsidiary 8 question. If any plaintiff had accounting that is adequate 9 accounting back to the beginning, that plaintiff might have a 
10 claim, you say. How are we to deal with judgement and per 11 capita accounts in this award? I'm using the word "award" as if 12 I had made one or as if I had promised to make one. I am not. 13 I'm using that word as shorthand. 14 MR. SMITH: Your Honor, presuming that there is an 15 award, the government raised the issue of judgement and per 16 capita accounts, and said certainly in this area we could show 17 an accounting and some damage claim could be made. 18 Your Honor, they had an opportunity to prove that at 19 the last trial, and as far as we could tell, they were 20 unsuccessful in showing that they could even produce an 21 accounting with respect to the very simple judgment or per 22 capita accounts. There were numerous issues that were 23 unanswered. There was no effort in those cases to, for example, 24 show the money was disbursed to the right people. Their 25 accountants looked at it but never looked at tribal rolls to 
Page 11 
1 make sure if money was properly disbursed. 
2 Even in those cases where -- there may be some remote 
3 cases out there where an account was opened just for a 
4 particular judgment, and then disbursed, but in most cases these 
5 were put into accounts and commingled with every other account 
6 holder out there. And you have the same issues; you don't know 
7 what the beginning account balances are. 
8 There were huge issues dealing with judgement and per 
9 capita accounts regarding interest, the interest to be 10 calculated, and those issues have never been resolved, despite 11 this trial. 12 So certainly the government had the opportunity to come 13 in and bring an action -- or had the opportunity to come in and 14 prove to the Court that with respect to this small class of 15 cases, we can do an accounting. As far as I can tell from the 16 evidence that was presented in this Court's ruling, they were 17 not able to do that. 18 And so I would put those class of -19 THE COURT: So you think they're precluded from doing 20 that in the hearing that we've got coming up in June? 21 MR. SMITH: Your Honor, I think that would be 22 ultimately your decision. They certainly had the opportunity to 23 do it and did not do it. I think that was the purpose of that 24 trial, was to show what the government could and could not do, 25 and they were unsuccessful in doing that. 
Page 12 1 You know, it's potential that a judgment or per capita 2 creditor could bring a damages action for money mismanagement 3 problems dealing with the management of those accounts, but 4 again, that's another issue that I don't believe is encompassed 5 within the scope of this particular proceeding. 6 THE COURT: Okay. 7 MR. SMITH: Your Honor, looking at the second issue you 8 mentioned regarding distribution, the government tends to sort 9 of conflate issues of calculation of a remedy and disbursement 
10 of money together, talking about this fluid recovery concept. 11 And as I understand fluid recovery, and I think every court 12 tends to interpret it a little bit differently, but that's not 13 what we have here. 14 Looking at the 2nd Circuit cases, you're dealing with a 15 situation where you have so many plaintiffs, and you don't 16 really know what the damage is so you make estimates of what the 17 damage might be, and you go ahead and have a presumption of what 18 the class would be and what the remedy would be, and then you 19 have the folks come in later and make claims and you have a 20 bunch of money left over. 21 Certainly that's not what we contemplate in this case. 22 Your Honor, should this Court enter an award of restitution and 23 disgorgement, we enter, obviously, another stage. I'm not sure 24 the defendants have standing at that point to contest the 25 disbursement or the manner under which it's disbursed, but it 
Page 13 
1 obviously is a key question for this Court. 2 We anticipate that it would be important for 3 appointment of a Special Master at that point to determine how 4 the money should be disbursed, to try to identify all the 5 beneficiaries, using the government's records and other sources, 6 and to get notice to all beneficiaries. And I think the Special 7 Master could make a best effort on determining how the money 8 should be disbursed. 9 Your Honor, based on what we've seen, and I know Your 
10 Honor has reservations about this at this point, but it most 11 likely should be done on a per capita basis. We realize that 12 there are different beneficiaries in different parts of the 13 country whose resources are different, but as a practical 14 matter, all their money has been commingled in one account. And 15 given the failure of the accounting, we believe it's an 16 impossible task to determine how that money should be allocated 17 based on individual resources. 18 I think this Court has a great deal of discretion under 19 various Supreme Court cases to determine what the fair and 20 equitable manner of disbursing that money is. And certainly 21 there are cases that have allocated that, a fund of that sort, 22 on a per capita basis, where the actual loss to individual 23 account holders is difficult to determine. 24 There's a case out of this district, Segar vs. Smith 25 it was a discrimination case, a promotion case - but in that 
Page 14 
1 case you had a certain amount of money based on the failure to 
2 promote, you had a lot of prospective employees, you don't know 
3 which one would have gotten the job. It was impossible to break 
4 that down by individual plaintiffs. 
5 In that case, it was a 1982 case, the Court said 
6 because of that difficult task of assigning different dollar 
7 amounts to individual class members, we're going to do it on a 
8 per capita basis. The Court felt that that was appropriate. 
9 THE COURT: Segar is the most unfortunate precedent you 10 could possibly give me. 11 MR. SMITH: I apologize for that. 12 THE COURT: Because I know the Segar case. 13 MR. SMITH: I know you do. 14 THE COURT: I brought the Segar case in 1982, and it 15 took 26 years to get it resolved. 16 MR. SMITH: I recall that. We're getting close, 17 Your Honor. 18 THE COURT: That's the only unfortunate part of it. 19 26 years, that gives new meaning to the Bleak House idea. 20 So go on. I'm familiar with Segar. 21 MR. SMITH: Starting to make us look pretty good. I 22 appreciate that. 23 You know, there's other cases around the country. But 24 particularly when you're dealing here for relief, you're not 25 looking at individual losses, you're looking at the benefit 
Page 15 
1 conferred on the government. And so your calculation isn't 
2 based on the individual losses, you're not looking at how much 
3 each person would have lost, even if that was possible. 
4 Instead, under those circumstances, where allocation is 
5 difficult, a fair and equitable manner may very well be to put 
6 it on a per capita basis. 
7 THE COURT: Mr. Smith, come on. You've got, what, 
8 300,000 individual Indian money accounts? 
9 MR. SMITH: Uh-huh. 10 THE COURT: Some of them are accounts to which payments 11 of a dollar and a quarter are made every few months, they're 12 fractionated down almost to the vanishing point. Right? 13 MR. SMITH: That's correct. 14 THE COURT: Some of them are very substantial accounts 15 that have been much less fractionated and are much more intact. 16 Right? 17 MR. SMITH: That's correct. 18 THE COURT: Some of them have to do with oil leasing 19 and some of them have to do with timber, some of them have to do 20 with cattle grazing and with markedly different receipts in each 21 of those accounts, and you would take an award of X billion 22 dollars and whack it up pro rata, per capita, so everybody gets 23 the same amount of money? 24 MR. SMITH: Your Honor, first -25 THE COURT: You don't think I'm going to get some 
Page 16 
1 opt-outs if I do that? 2 MR. SMITH: You may very well get some requests for 3 opt-out. You certainly could. But each individual beneficiary 4 has a history going back 100 years of money that has been 5 accumulated or that they should have been entitled to from 6 various sources over that 100 years. It hasn't always been a 7 single fractionated share. They have predecessors in interest 8 who had various shares that should have been distributed to them 9 over the past century. 
10 So while it may be $1.25 today, accumulated over what 11 they should have been entitled to over years is obviously much 12 more. 13 Certainly a Special Master can look and try to come up 14 with some calculation for that, but I think that would be 15 difficult. And looking at principles of -- at equitable 16 principles per capita may be the best, fairest way in fact to do 17 that. 18 THE COURT: Well, the problem you put to me, the class 19 action problem you put to me, which is that no individual 20 plaintiff can really possibly bring an action, that's your 21 assertion here -22 MR. SMITH: Uh-huh. 23 THE COURT: -- and therefore they're sort of stuck with 24 the class action remedy, raises in my mind the question of 25 whether there are due process rights of individuals who are 
Page 17 
1 subjected to class treatment of their claims. 2 And a decision to divide the money up per capita is a 3 kind of -- from the standpoint of somebody who thinks and can 4 make a colorable showing that he's entitled to a larger share of 5 that, seems to me to deprive him of the right to at least make 6 some argument to somebody that he should get a higher share of 7 that money. Or she. 8 MR. SMITH: Your Honor, that brings up obviously the 9 circuit's decision in Eubanks and the implications of that. 
10 Your Honor, the key in Eubanks was whether there were clear 11 disparities in the nature or the magnitude of the relief sought 12 by individual class members. 13 In Eubanks the Court classified the relief as 14 equitable. But it was back pay, and so every potential class 15 member had a potentially different amount of back pay. It was 16 classified as equitable; it really was more of a compensatory 17 type damage remedy. 18 Here, Your Honor, certainly there are no disparities in 19 the nature of the relief that is requested. The nature of the 20 relief is uniform with respect to all class members. And again, 21 unlike in Eubanks, we're not focusing on the loss to individual 22 members, we're focusing on the benefit conferred on the 23 government. We're not relegated to try to determine what each 24 individual account holder would have lost. Under Eubanks, if 25 any individual member can come in and show he is sufficiently 
Page 18 1 unique or distinct from other members of the class, I believe 2 under Eubanks this Court can consider an opt-out. 3 But I don't think we go there, where here the relief is 4 solely equitable, solely based on the defendants' own misconduct 5 and not on individual losses. I don't think we have those due 6 process concerns there. 7 THE COURT: I seem to remember being told, maybe on day 8 one of my involvement with this case, that plaintiffs had a much 9 more sophisticated model in mind for distributing the results of 
10 this, a model that had something to do with timber sales and 11 geography and grazing and oil, and which tribes and which 12 individual members of which tribes might be expected to have 13 larger shares. What happened to that? 14 MR. SMITH: Your Honor, you heard a part of that model 15 from Mr. Fasold. And certainly not the entire model. And I 16 know you expressed some dissatisfaction with his presentation of 17 that model. 18 That model is still out there. You can look at 19 resources throughout history and determine certain amounts that 20 were allocated on certain amounts. 21 But I tell you, the best person to address that 22 particularly is probably Mr. Gingold, as he's just informed me. 23 That's something he has worked on for the past 12 years. 24 THE COURT: Okay. Well, I'll pass on Mr. Gingold now 25 because I'm sure he's going to be up on some other subject. 
Page 19 
1 Maybe we can talk about it when it's his turn. 2 MR. SMITH: Okay. 3 THE COURT: Anything more to tell me about class 4 certification or manner of distribution? 5 MR. SMITH: Not those particular issues, no, 6 Your Honor. 7 THE COURT: Mr. Smith, before you go, I asked the 8 question when I was talking about the class about claim 9 preclusion, and I'm not sure if you answered that. I'm not sure 
10 I caught it when it was going by. What is precluded by an 11 award, of the award that you contemplate? 12 MR. SMITH: Your Honor, it's our position that as we 13 understand this trial going forward, that nothing has precluded 14 an individual beneficiary from pursuing a damage claim, and 15 nothing will preclude an individual beneficiary from presenting 16 a damage claim to the court of claims if they feel it's 17 possible. We don't think it is, based on the failure of the 18 accounting. But I don't think anything would preclude any of 19 the class members from attempting to assert a damage claim. 20 THE COURT: And a damage claim would comprehend what, 21 mismanagement, failure to collect, selling land too cheap? 22 MR. SMITH: Failure to collect, those things that at 23 least at this point this Court has determined is not within the 24 scope of this. But I think any damage claim, if they feel they 25 can show losses to their account, they have always had the 
Page 20 1 opportunity to present that damage claim to the court of claims. 2 I don't think at this point anything precludes that. 3 THE COURT: All right. Thank you, Mr. Smith. Let me 4 hear from the government on those two first points. 5 MR. QUINN: Good morning, Your Honor. Michael Quinn 6 for the United States defendants. 7 THE COURT: Good morning, sir. 8 MR. QUINN: I will attempt to address Your Honor's 9 questions and Mr. Smith's arguments with respect to the two 
10 issues you mentioned first this morning regarding 11 claim-preclusive effects and distribution. Mr. Stemplewicz may 12 have something to add on the distribution issue, but I can 13 address it somewhat from the class action perspective, 14 Your Honor. 15 I think your questions touch on a key concern that the 16 United States has with plaintiffs' proposal here for a trial in 17 June. First off, plaintiffs make no case that any damages could 18 be awarded under the first provision in which this case was 19 originally certified under 23(b)(1)(a). They argue that it 20 should go forward under 23(b)(2). However, in order to accept 21 plaintiffs' position and proceed on that basis, you essentially 22 would have to ignore three controlling decisions of the 23 DC Circuit, none of which plaintiffs even address in their 24 briefing. 25 The first is Thomas v. Albright, which holds, and in 
Page 21 1 that case vacated and remanded a class certification decision in 2 a settlement circumstance because it failed to consider the 3 Eubanks v. Billington factors and analysis for whether a case 4 can be appropriately certified under 23(b)(2). 5 In the case of Thomas, as in the certification decision 6 here, the original certification order was issued prior to the 7 DC Circuit's decision in Eubanks. So this Court has never 8 considered this case with respect to the Eubanks v. Billington 9 factors and analysis. 
10 Thomas holds that it's an abuse to discretion to go 11 forward with 23(b)(2) cases, particularly when you're going to 12 discuss or address opt-outs or notice to the class, without 13 going back and re-examining the propriety of certification under 14 23(b)(2). Thomas v. Albright is 139 F.3d at 525, and that's 15 addressed in our briefing. 16 The second case that plaintiffs fail to address in 17 their briefing, and which the Court would have to ignore in 18 order to proceed under 23(b)(2), is In Re: Veneman. That's at 19 309 F.3d 789. In that case the Court was concerned -- I believe 20 the Court has already referred to it this morning, and I would 21 like to just briefly quote from a particularly appropriate 22 section of that case at 795 and 796. 23 The Court mentions that there are two concerns 24 surrounding Rule 23 class actions; first, how class 25 certification affects the due process rights of absent class 
Page 22 1 members to have their own day in court, and second, whether the 2 parties are bound by the judgment. Your Honor, those are 3 precisely the issues you were attempting to get at this morning. 4 But the Court in Veneman goes on to say: "As to the 5 first point - that is, how it affects the due process rights 6 the Supreme Court established in Phillips Petroleum vs. Shutts 7 that, one, before a court can bind absent class members," and 8 quoting from Shutts, "concerning claims wholly or predominantly 9 for money damages," unquote, "due process requires that they 
10 receive adequate notice and an opportunity to opt out of the 11 action." 12 The Court went on to say: "The defendant in such an 13 action has a right" - that is, the government here would have a 14 right - "standing, in effect, to demand that adequate notice be 15 given to the class members so as to avoid a situation where the 16 defendant would be bound by a loss, yet class members would not 17 be bound by its win." And that's the risk and one of the 18 concerns that we have in going forward under 23(b)(2). 19 To go on in Veneman, the Court also said: "To 20 complicate matters further, the Supreme Court has expressly left 21 open the question of whether a judgment in a no opt-out class 22 action," such as we have here, "like the one that the District 23 Court certified in Veneman, can ever preclude absent class 24 members from bringing their own individual lawsuits for monetary 25 damages," citing Ticor Title Company vs. Brown, 
Page 23 
1 511 U.S. 117. 2 The Court then mentioned second: "The constitutional 3 concern in Shutts and the Supreme Court's case Ticor may also 4 implicate concerns underlying Rule 23, and these constitutional 5 questions are not avoided simply because the party elects," as 6 they claim here, "to pursue it as an equitable remedy." 7 I think if you go and look at the Eubanks decision, 8 Your Honor, you see that in Eubanks the Court clearly said that 9 it doesn't matter whether you've styled this as a claim for 
10 money damages or as one for injunctive relief. Eubanks involved 11 a question of the propriety of awarding back pay as incident to 12 a Title VII type of claim. 13 The Court said in Eubanks that, "Back pay, that it's 14 considered as a form of equitable relief, does not undercut the 15 fact that variations in individual class members' monetary 16 claims may lead to divergence of interests that beg unitary 17 representation of a class problematic." That's Eubanks, 110 18 F.3d at 95. 19 Your Honor, that's the situation we are presented with 20 here, is we have an equitable theory that's been advanced by the 21 plaintiffs that is not an award to the whole. It is not a claim 22 of a whole. It's like you take a rubber -- you have one of 23 these rubber band balls, they bounce and it looks like one big 24 ball, but when you start looking at it, there are different 25 strands. Some are long, some are short, some are thin, others 
Page 24 
1 fatter. They all come apart. They're individualized, different 
2 colors. 
3 And I think that's what Your Honor was concerned 
4 about -
5 THE COURT: Wonderful extended metaphor. 
6 MR. QUINN: I'm sorry, Your Honor. I tried to come up 
7 with something that could be concrete about the significance of 
8 the abstract problem that exists here. 
9 It is true, we know right off the bat, that as a whole, 10 plaintiffs have serious problems with the theory that they're 11 proposing. For one, Your Honor in your January 30 decision came 12 to the conclusion that certain members of the class, at least 13 putatively, are not proper plaintiffs in this class action; that 14 is, people who died before the act took effect in 1994. 15 THE COURT: That's a problem. 16 MR. QUINN: There's no approach here to carve out or 17 identify monies that belong to those people that are not part of 18 this case. Why should -19 THE COURT: Mark that down on your June 9th calendar. 20 MR. QUINN: Well, Your Honor, second, the class 21 definition excludes people who have brought claims prior to the 22 class being certified here. And there have been some claims, 23 cases brought by individual Indians that might exempt, take them 24 out from class consideration. 25 THE COURT: How many cases are there? 
Page 25 
1 MR. QUINN: Offhand I can't say, Your Honor. 
2 THE COURT: Half a dozen? 
3 MR. QUINN: That's probably a fair assessment. 
4 THE COURT: Okay. 
5 MR. QUINN: The other is we know also, and I think it 
6 was touched on here this morning, that those who have had 
7 accountings under per capita or settlement judgment accounts, 
8 those types of accounts, several thousand claimants, several 
9 thousand accounts, the Department of Interior is at 95 percent 

10 complete with those accountings. 11 Those accountings we believe do not run into some of 12 the problems in terms of the administration, performance of the 13 accounting. Most of those do not involve probated estates, they 14 don't have that question about going back in time and looking at 15 prior predecessor interest. They don't have those things. 16 They're limited in time. There's no explanation offered by 17 plaintiffs, and I heard none this morning, why those class 18 members should participate in any award here. Their money is 19 not at stake, based on their theory. 20 In a sense, and we've presented this in our briefing, 21 Your Honor, the plaintiffs have essentially put forward what is 22 referred to in the 2nd Circuit as an argument for a fluid 23 recovery. The recent case of the 2nd Circuit Court of Appeals 24 in McLaughlin vs. American Tobacco touches on the problems that 25 are inherent with that approach. 
Page 26 1 In the McLaughlin case, cigarette smokers as a class 2 tried to sue the tobacco company over light cigarettes. They 3 couldn't prove -- they had problems of proof trying to show 4 individual injury. I think that's what Mr. Smith is trying to 5 argue here this morning, that some of these people wouldn't be 6 able to show individual harm with the particulars of their 7 account because they wouldn't have enough information. 8 That was the essentially the problem the plaintiffs 9 were trying to get around in the McLaughlin case. They proposed 
10 a different approach. It was essentially a disgorgement; in an 11 economic analysis, the price difference, the profits, the excess 12 profits that the American Tobacco Company earned by hiding the 13 fact that the light cigarettes were not as safe as people were 14 led to believe, so that you would have a price differential 15 between the price actually paid and the price that would have 16 been commanded in the market had people known the truth. 17 The Court of Appeals rejected that approach as a class 18 action claim, and I think it's worth considering the reasons 19 that they did so. And I'm quoting here from what is on the 20 Westlaw version page start 11 of that opinion: "We reject 21 plaintiffs' proposed distribution of any recovery they might 22 receive because it offends both the Rules Enabling Act and the 23 due process clause. The distribution method at issue would 24 involve an initial estimate of the percentage of class members 25 who were defrauded and therefore have valid claims. The total 
Page 27 1 amount of damages suffered would then be calculated based on 2 this estimate, and presumably on an estimate of an average loss 3 for each plaintiff. Essentially a per capita type of award." 4 "But such an aggregate determination is likely to 5 result in an astronomical damages figure that does not 6 accurately reflect the number of plaintiffs actually injured by 7 defendants, and that bears little or no relationship to the 8 amount of economic harm actually caused by the defendants. This 9 kind of disconnect offends the Rules Enabling Act, which 
10 provides that federal rules of procedure such as Rule 23 cannot 11 be used to bridge, enlarge, or modify any substantive right. 12 The Court further explained that, quote, "Roughly 13 estimating the gross damages to the class as a whole, and only 14 subsequently allowing for the processing of individual claims, 15 would inevitably alter defendants' substantive right to pay 16 damages reflective of their actual liability." 17 THE COURT: Well, Mr. Quinn, the problem with that, 18 with the McLaughlin decision, is that apparently, as I 19 understand what you've read to me, the Court used a few data 20 points about injury and then figured out what the damage was. 21 But here we're starting with a big number and deciding how to 22 distribute it. 23 I mean, I hear you, but suppose, for example -- I'm 24 just thinking out loud a little bit here, but suppose -- let's 25 take an award of X, just take an award of X dollars, and it 
Page 28 
1 represents, after we sort out whether dead people are entitled 
2 to it, after we sort out whether per capita and judgment 
3 accounts are entitled to a piece of it, whether we decide 
4 whether Osage headrights, it represents individual Indian money 
5 account receipts that have never been properly accounted for. 
6 Okay? Let's call it that. 
7 MR. QUINN: For sake of argument, I'll assume that, 
8 Your Honor. 
9 THE COURT: For sake of argument. And then let's say 10 there are 300,000 Native Americans who are entitled to a piece 11 of that. Somebody is appointed to sort this out; remains to be 12 seen. I mean, the United States is the trustee, and I suppose 13 the United States would want to say, well, we would like to be 14 the trustee for that. Plaintiffs would say, no, no, it's got to 15 be somebody else. But let's sort that out later. Somebody is 16 going to sort this out. 17 Notice is given to the entire class that this is the 18 award. The class is told that there are going to be two phases 19 in distributing this award; the first phase will consider 20 individual claims brought by individuals who want to make a 21 claim, a specific claim. Those individual claims would be heard 22 and decided, monies disbursed, and then what's left over will be 23 distributed -- the class will be told, what's left over will be 24 distributed per capita. And the class will also be told, if you 25 don't like any of this, you can opt out and try to do it 
Page 29 
1 yourself. 2 Now, what are the constitutional, practical McLaughlin 3 or other problems you see in approaching it that way? 4 MR. QUINN: Well, for one, Your Honor, I think it 5 violates the Veneman decision of the DC Circuit, which the 6 primary concern there, they were faced with a petition 7 interlocutory from a certification decision, where the Court had 8 been faced with a question of whether we have a hybrid 9 certification of a class; that is, under 23(b)(2) go forward on 
10 the substantive injunctive relief, and reserve for later whether 11 we have a damages issue that's going to need to be resolved and 12 be addressed, perhaps to qualify for class treatment under 13 23(b)(3). But we'll leave that to another day. 14 That petition went up to the Court of Appeals. The 15 Court of Appeals addressed great reservations about that, 16 ultimately remanded the case without deciding it, because it was 17 concerned that the issues that they were most concerned about 18 hadn't been really briefed by the parties. And that goes to 19 this issue about the notice to the class and the decision, when 20 the decision is made. 21 Rule 23 urges the Court to make a class certification 22 decision at the earliest practical time. And there are serious 23 constitutional questions to keep a case open with half of a 24 case -- with a case going to trial on an issue without having 25 already made the determination about who is in the class and 
Page 30 1 who's out, and giving that notice in advance of the trial. 2 I don't see how you could go forward, if you were going 3 to allow opt-outs and give notice to class, with a trial in 4 June, just as a matter of practicality. Because all that would 5 have to transpire in advance of the trial, or you put the 6 outcome of the trial at risk later in terms of those who want to 7 opt out or argue that they should have been given notice prior 8 to the trial. 9 In terms of the distribution and those who have claims, 
10 I think plaintiffs have a burden of establishing, as part of 11 their claim for unjust enrichment, that the money that they're 12 claiming for is inured to the benefit, taken from those class 13 members. And that may be ultimately a question of proof at a 14 trial. But in terms of -- you can't just throw a number up 15 there and say, well, it belongs to everybody in the class, when 16 it doesn't. 17 This case started out as a 23(b)(2) case or a 18 23(b)(1)(a) case where it made sense to proceed under those 19 provisions as a class, because regardless of the fact that 20 everybody had different accounts -- and we're talking about 21 hundreds of thousands of separate accounts, not a pooled fund, 22 not a single fund in which everybody shares a similar interest. 23 We have land in Montana, leases for range, timber leases, oil 24 leases, commercial leases in California, all those have inherent 25 different questions. 
Page 31 1 Plaintiffs' land claim that is really kind of way, way, 2 way beyond the pale that they've tried to bring in, they've 3 tried to argue that that's all part of the common relief here, 4 but we know, just sitting here today, that none of the four 5 representative class plaintiffs has a legal interest in all 6 those parcels of land. 7 But the point is, it made sense originally to proceed 8 under 23(b)(2) and (b)(1)(a) because we were talking about a 9 singular duty to account that was same across all these 
10 different interests. What's happened now is we've changed the 11 entire case. We turned it around to a case involving numerous 12 tens of thousands of different interests seeking claims against 13 the government for money allegedly improperly withheld. 14 Those are all -- if money was withheld, there's no 15 proof that it was withheld in common from everybody across the 16 class. If there was money withheld from an oil well royalty in 17 Texas, that doesn't give someone who is a land holder in Montana 18 a claim for unjust enrichment. You have to tie it -- even in 19 the trust cases that allow tracing into commingled funds, the 20 burden is still on the plaintiff to show entitlement to the 21 money that's been commingled. They just say, because it's 22 commingled, we get a pass on having to prove it. That's not the 23 law, Your Honor. 24 So I would say that ultimately, as they've framed the 25 relief remedy, they cannot be awarded as a class mechanism. You 
Page 32 
1 could have four individual, five individual plaintiffs make 
2 claims of unjust enrichment as individuals, but it couldn't be 
3 conducted as a class remedy, even if you got to 23(b)(3) and 
4 tried to do this as a hybrid. 
5 But if you were to proceed at all, I think you would 
6 have to give the notice and the right of opt-out in advance of 
7 the trial to the class to give them -- and they would have to 
8 know, what's the theory of the recovery, what's the distribution 
9 going to be, before they go blindly allowing the case to go into 10 the merits of the remedy. 11 THE COURT: Well, seems to me the notice that you're 12 talking about might be a better informed, more informative 13 notice after evidence is taken on the -- further evidence is 14 taken on the amount of any award, and the contemplated method 15 for its distribution. 16 MR. QUINN: Well, I mean, certainly as a plaintiff I 17 would like to know I could hold back my bet and keep it in my 18 pocket and decide what the outcome is until the cards are laid 19 up on the table, and then decide whether I want to participate 20 or not. I mean, I don't think that's the appropriate approach 21 to take in terms of what the informed approach in terms of an 22 opt-out is. 23 THE COURT: Okay. At any rate, your answer to my 24 question is, read Veneman? 25 MR. QUINN: That's one, Your Honor. I would also urge 
Page 33 
1 you -2 THE COURT: I will do that. I've read it once, I'll 3 read it again. 4 MR. QUINN: I would also suggest one other. When 5 plaintiffs came back in their reply brief and had affirmatively 6 said, we're not going to even talk about distribution now, and 7 tried to distinguish McLaughlin as a distribution case when 8 they're talking about fluid recovery, looking for some guidance 9 on distribution, I came across this other case I think is 
10 instructive by Judge Pollack out of the Southern District of New 11 York. It's Schaffner vs. Chemical Bank, 339 F.Supp 329, 1972. 12 In that case, a beneficiary of a trust managed by 13 Chemical Bank tried to bring a class action on behalf of her 14 trust for certain overcharge practices by Chemical Bank as 15 trustee. And the class she sought to have certified was a class 16 that involved her trust as well as several thousand trusts also 17 managed by Chemical Bank. 18 Judge Pollack refused to certify the class as such, and 19 said: "While strictly not the same, the attempt of the 20 plaintiff to include in her class not only beneficiaries of her 21 own trust but beneficiaries of separate and distinct trusts is 22 akin to attempts by shareholders of one corporation to sue on 23 behalf of shareholders of all other like corporations. Several 24 attempts have been made to join as a class shareholders of 25 different mutual funds on federal claims bearing a similarity to 
Page 34 1 those here asserted. These attempts have been turned back 2 uniformly. Thus far, courts have limited the equitable remedies 3 of the individual plaintiff only to actions involving the 4 economic union with which he has been associated," citing a 5 series of cases. That's -- I'm trying to find the exact page 6 where that quote appears, Your Honor. That's at 337, 38 of that 7 decision. So I would urge Your Honor to take a look at that as 8 well. 9 This is a remedy that involves individual rights. The 
10 income streams are individual, the timing of when money may have 11 been withheld from any particular person is individual, the 12 amounts are individual, the issues are individual, and we would 13 submit it's not amenable to a class action treatment under any 14 provision. 15 Under 23(b)(3), for Your Honor to consider the 16 amenability of that, plaintiffs have an obligation to bring 17 forth a motion and bring forth proof that they're entitled to 18 treatment under 23(b)(3). They haven't asked that. 19 THE COURT: No, they have not. 20 MR. QUINN: So you're kind of stuck with 23(b)(2). And 21 23(b)(2), if you go back -- and I'm sure Your Honor has already 22 looked at Eubanks several times. But when you look at that 23 decision, the limitation of 23(b)(2) in terms of granting 24 opt-out and notice to class is designed for specific situations 25 where you have a particular plaintiff party who is in the class 
Page 35 1 as a special circumstance and needs to be excused from the 2 class. 3 That's not meant to be an exemption that allows you to 4 take what is normally a 23(b)(3) type of class action for 5 damages. And that's really what we're here about. Plaintiffs 6 talk about this as injunctive relief, equitable relief, but that 7 is essentially a fiction. If this Court's jurisdiction weren't 8 limited to awarding equitable relief, we would be talking 9 essentially about a damages claim. That's really essentially, 
10 at bottom, what they're seeking. 11 And I would ask Your Honor to look at one other case, 12 finally, that's in our brief, a case from last year decided by 13 the DC Circuit, Richards vs. Delta Airlines, 453 F.3d 525, 14 DC Circuit 2007. And we've discussed that in our brief, but I 15 wanted to highlight the point there. 16 The Court said, quote, "Plaintiff cannot transform a 17 claim for damages into an equitable action by asking for an 18 injunction that orders the payment of money." In that case they 19 brought a claim for a declaratory judgment action against the 20 airline, asking for an order requiring them to pay for lost 21 baggage. 22 And essentially that's what we have here in our case, 23 is plaintiffs can know that they can't bring a damages claim, 24 they know that the damages elements of their complaint were 25 stricken from this case with their blessing back in 1998, and so 
Page 36 
1 they're stuck choosing this Court, choosing these claims, 
2 they're stuck with the one remedy that this Court has recognized 
3 all along that they're limited to, and that is the accounting. 
4 To get beyond talking about monetary remedy in this 
5 context, I think it runs into the problems that the DC Circuit 
6 found in Richards v. Delta Airlines as well. 
7 THE COURT: Well, just let me comment on that last line 
8 of argument about Richards vs. Delta Airlines. It is certainly 
9 true that the plaintiffs have been hard pressed throughout this 10 case to describe what they wanted without using the term 11 "money." And they have been -- as you pointed out in your 12 brief, they expressly disavowed seeking an order for the payment 13 of money early on in this case. 14 And watching the plaintiffs try to navigate around that 15 rock, that big rock, is a subject of some -- strike that. I was 16 about to say amusement, but strike that. It's interesting to 17 watch the plaintiffs try to deal with that problem, which is a 18 serious problem for them. 19 But one thing -- and I have to tell you that I am not 20 at this point sure that an actual dollar award can be made, or, 21 if made, would be sustained on appeal. But I'm certainly going 22 to figure out what the dollar award should be, and there's no 23 question that I have declaratory judgment jurisdiction, and so 24 one result of this procedure may be a declaratory judgment that 25 the defendant is unable to account for X dollars that have been 
Page 37 1 received in IIM accounts, and under the law of equity should pay 2 it. 3 Whether the government ever responds to declaratory 4 judgment actions unaccompanied by injunctions is an interesting 5 question, and one that I've always -- you know, the government's 6 response to that may be, how many divisions has the Pope. I 7 don't know. 8 And then there's another piece of the order that might 9 say, pay it, if I decide that I have, and then the whole thing 
10 goes to the Court of Appeals and the Court of Appeals decides 11 whether only the payment -- whether the payment order is 12 sustained or whether the declaratory judgment is sustained. 13 But I assure you that one way or another, the result of 14 this process is going to be a dollar figure. Because I have 15 believed from the time I took this case on that what this case 16 needs more than anything else is a dollar figure, so that 17 somebody up in the other branch of government can focus on this 18 and decide what to do about it. 19 So I hear you on the jurisdictional question, and I 20 agree that it is a dicey and complicated one, and I agree that 21 the plaintiffs have had a very difficult time with it throughout 22 this case, but my stewardship of this case is going to end with 23 something preceded by a dollar sign. 24 MR. QUINN: And I appreciate that, Your Honor. I 25 understand what you're saying here. However, the number that 
Page 38 
1 they're claiming, that we get up to somewhere in the 2 neighborhood of $58 billion, I think even by your own standard 3 in the Garcia case, is not incidental. I don't think it 4 qualifies by any test as incidental under 23(b)(2). 5 So there's more than just a jurisdictional problem, 6 there is a procedural problem that Your Honor faces, because 7 plaintiffs have basically limited your consideration here of the 8 class treatment of remedy. Your Honor could come up to a 9 number, I would say, in terms of the actual plaintiffs who are 
10 named in the case, but as far as a class remedy, Your Honor has 11 to be comfortable, in effect, that 23(b)(2) allows this kind of 12 a relief. 13 And I think your own prior decisions where you've 14 considered this before, $20 billion I think at stake in Garcia, 15 you said it predominated over the injunctive relief in any sense 16 of the word. 17 And what we have here is monetary relief that is not 18 seeking to be incidental. It's not back pay as part of an 19 injunctive relief order and restatement or something of that 20 order, which is the traditional Title VII racial discrimination 21 kind of claim that's supposed to be addressed under 23(b)(2). 22 This doesn't come close to that configuration. 23 What we have here is a remedy that seeks to supplant 24 the injunctive relief that was supposed to be ordered. So in 25 effect, I don't know how you get past -
Page 39 
1 THE COURT: My own decision in Garcia? 2 MR. QUINN: Well, or the rule limiting 23(b)(2) to 3 predominant issue. Particularly with the question you started 4 out with, Your Honor, about the finality concerns and preclusive 5 effect, particularly in view of plaintiffs' remarks in their 6 reply brief. Reply at 78, note 88, plaintiffs say, "Class 7 members would not be precluded for seeking damages claims in 8 U.S. Court of Claims once these proceedings are concluded." The 9 United States has no assurance, you put a number up there, what 
10 that would terminate in terms of finality down the road after a 11 judgment were rendered. And even if the United States 12 ultimately paid a sum of money, where that would leave us in 13 terms of continuing exposure. 14 A reply at page 97 offers another problem to 15 plaintiffs' allegations here for a remedy. At 97 of the reply 16 brief, plaintiffs say, quote, "The relief that plaintiffs 17 request," and they cite their own brief, original brief at 19 18 and 20, "is all equitable in nature, and alternative available 19 remedies in light of the inability to account, and is 20 independent of any monetary recovery adjudged by this Court." 21 In essence, I think they're acknowledging there that 22 their proposal for a remedy here -23 THE COURT: What page of their reply? 24 MR. QUINN: Page 97 of their reply, Your Honor, they 25 say, "The relief that plaintiffs request," citing their opening 
Page 40 
1 brief -2 THE COURT: By the way, from now on, anybody who wants 3 to file a brief longer than 35 pages has to accompany it by a 4 motion for leave to exceed the page limitation, which I usually 5 grant by saying, you can file any length you want to, I'll read 6 the first 35 pages. 7 Page what? 8 MR. QUINN: 97 of the reply brief, Your Honor. 9 THE COURT: 97, all right. 
10 MR. QUINN: I believe the quote is -- and I don't have 11 the page in front of me, I just have the extract. It says, "The 12 relief the plaintiffs request," citing plaintiffs' brief at 19 13 and 20, "is all equitable in nature, and alternative available 14 remedies in light of the inability to account, and is 15 independent of any monetary recovery" -- it's at page -- oh, 16 there's another reference to that, yeah. "Adjudged by this 17 Court." 18 And also at page 66 of their brief they make a similar 19 statement, Your Honor. Page 66 of their brief, the first full 20 paragraph, at the very end of the paragraph they say in the last 21 clause, "Plaintiffs now seek the equitable remedies of 22 restitution and disgorgement independent of their previous 23 accounting claim." 24 So I think we have another preceding question about 25 what the nature of this remedy is that they're actually seeking. 
Page 41 1 Because if it does more than anything to address the accounting 2 claim, which we understood coming in is the only thing the Court 3 wanted to address, those claims should be carved out, or those 4 remedies, to the extent they try to remedy some other wrong, 5 need to be pared back. 6 And those are all things that I submit would need to be 7 addressed before we go into any trial. 8 THE COURT: Well, I'm interested in hearing -- that's 9 an interesting sentence, that sentence on page 66, and I don't 
10 know what it means either. 11 MR. QUINN: But you take that together with plaintiffs' 12 other representations about there not being really -- they're 13 not having any assurance of any kind of finality about what an 14 award in this case would foreclose in terms of finality, I think 15 that runs into one of the legs that concerned the Court in 16 Veneman that they expressly addressed about the defendant having 17 standing to make sure that when the case comes to conclusion, 18 there are certain claims that are going to be foreclosed, and we 19 know what those are. And if you can't know what those are, I 20 think you have problems in terms of the remedy that you're 21 trying to confer on the parties. 22 THE COURT: Okay, Mr. Quinn. Anything further? 23 MR. QUINN: Mr. Stemplewicz has something on 24 distribution. 25 THE COURT: Mr. Stemplewicz? 
Page 42 1 MR. STEMPLEWICZ: Good morning, Your Honor. I had been 2 prepared to address the jurisdictional and sovereign immunity 3 issues. I'm not going to belabor those points after Your 4 Honor's introductory comments. 5 However, I think that the problem Your Honor identified 6 as far as distribution is concerned highlights one of the key -7 the fundamental jurisdictional problem here, the sort of 8 jurisdictional runaway train that this proposed remedy would get 9 us on in light of where Bowen went, and later with the Blue Fox 
10 decision. 11 And that is, no matter how large a sum of money we come 12 up with, or how small, and no matter how we divide it up, 13 whether it's pro rata or we come up with some way of identifying 14 categories, subcategories of class, however it's done, not one 15 single member of the plaintiff class is going to learn one 16 single scrap of information about the transactional activity in 17 his or her IIM account. 18 And that is what they came here for, ostensibly. That 19 is what the 1994 Act is intended to provide, to sort of open 20 this curtain of disinformation or lack of information that was 21 out there. And the point is, that is clearly substitutionary 22 relief. 23 Judge Lamberth said that the very thing to which 24 plaintiffs are entitled under the Bowen analysis is an 25 accounting. We've been on that path all this time, and now, 
Page 43 1 suddenly, the very thing, as they point out now in their brief, 2 is a refund of monies wrongfully withheld and the disgorgement 3 of profits. Those are very different very things. 4 And when you look at the direction the Supreme Court 5 signaled in 1999 in the Blue Fox case, that is exactly the wrong 6 direction that the Court should proceed with. 7 Thank you, Your Honor. 8 THE COURT: I hear you. Fine. I got it. There are 9 certain forms of words that both sides have latched on to like 
10 grim death in this case. One of them is "substitutionary 11 relief," one of them is "repudiation," which appears about 45 12 times in the plaintiffs' brief, I have no idea why. Maybe 13 they'll tell me why "repudiation" is such a magic word and why 14 "substitutionary relief" is such a magic word. 15 But the problem with both sides' arguments here is that 16 these magic words that come from 200 years of equity 17 jurisprudence just don't fit here. And I've got to find some 18 way to get this case over with, and getting it over with by 19 dismissing it because it's impossible, because an accounting is 20 impossible, makes no sense to me, and getting rid of it by 21 remanding it to the government to do what is impossible makes no 22 sense to me. So you can call it substitutionary relief if you 23 want to. I don't, at this point. 24 MR. STEMPLEWICZ: With all due respect, Your Honor, 25 that's not our term. That's right out of Blue Fox. 
Page 44 
1 THE COURT: I understand. I understand. 
2 MR. STEMPLEWICZ: And at least remanding -
3 THE COURT: But you have latched on to it. 
4 MR. STEMPLEWICZ: Well, certainly. That's what the 
5 standard is. Unfortunately, there's no different standard for a 
6 12-year old case. 
7 And, you know, however questionable it may be in the 
8 Court's view to remand this to Interior to do the best 
9 accounting that can be done, the fact is, at least doing so will 10 provide answers to questions or at least information that the 11 IIM account holders have about their accounts that are not going 12 to be answered by a check. That check is nice, everybody likes 13 money, but it is not going to solve the problem, it's going to 14 raise more problems. Why isn't my check larger? Why did my 15 cousin get $50 more than I did? What does this have to do with 16 the transactional activity? 17 THE COURT: Or why did my cousin get the same amount 18 that I got? That rotten cousin of mine got the same amount per 19 capita. What sense does that make? That's more likely what 20 you're going to get. 21 MR. STEMPLEWICZ: But the money is not going to answer 22 those questions, Your Honor. 23 THE COURT: All right. Thank you very much. 24 Let's move on to the time value of money. Who's going 25 to talk about that for the plaintiffs? And then on to the 
Page 45 1 merits, or the merits, if that's the right word, the content of 2 the trial. 3 Mr. Gingold? 4 MR. GINGOLD: Thank you, Your Honor. Mr. Stemplewicz 5 is right, to a certain extent; terms do have significant 6 importance with respect to whether or not this is a damages 7 action, as the government says it is, or whether or not it is 8 what plaintiffs say it is, which is an action in equity, Your 9 Honor, to enforce the trust. And Your Honor, we sought to 
10 enforce the accounting duty for some years, and that accounting 11 duty has been rendered impossible. 12 Many judges have looked at that very issue, from 13 Learned Hand to Justice Alito when he sat on the 3rd Circuit, to 14 Judge Posner in the 2nd Circuit, to Judge LaValle in the 15 2nd Circuit. And they have all come down the same way. There 16 is no disagreement, there is no ambiguity. Equity and 17 restitution is the opposite of damages. It's a substantive 18 issue, it's not a form over substantive issue. It never has 19 been, Your Honor. And it particularly applies in a situation 20 like this where we have an express trust. 21 When we're looking at the time value of money, that's 22 one of the standards, as a matter of fact, Your Honor, and it's 23 a term of art that is used and has been used even in this 24 circuit, but clearly with respect to the 3rd Circuit, with Judge 25 Alito, when he was sitting in the 3rd. 
Page 46 
1 And it has been discussed in detail by all the 2 authorities, whether you're dealing with a restatement of 3 restitution, whether you're dealing with restatement third or 4 restatement second or you're dealing with the various drafts 5 that go through March 12th of this year. That is expressly 6 identified as one of the measurements available to plaintiffs 7 when they are seeking equitable restitution as opposed to 8 damages. 9 Plaintiffs were well aware of the jurisdictional issues 
10 between the claims court and the District Court when this action 11 was filed on June 10th, 1996, and plaintiffs were also well 12 aware of the preclusive issues that could arise, and also 13 evaluated whether or not it was appropriate to file 14 contemporaneously in the claims court with regard to the damages 15 issues, and in the District Court with regard to the pure 16 traditional equitable relief. 17 The decision was made to file in this court solely, for 18 several reasons, one of which, Your Honor, is the fact it would 19 be rank speculation to determine the nature and scope of 20 damages, if any, until an accurate and complete accounting is 21 rendered. 22 The accurate and complete accounting was related to the 23 fact, notwithstanding counsel for the government's opposition, 24 that this is now and always has been a commingled trust. The 25 funds are collected in common, they're deposited in common, 
Page 47 1 they're invested in common, they're allocated in common, and 2 from that common fund the distributions are made. 3 Whether you're looking at common law, which explains 4 what a common trust fund is, or commingled trust, or the federal 5 government's own regulations under 12 CFR 9.18 dealing with 6 bank-administered common trust funds, it's all the same thing 7 and these criteria are met. As a matter of fact, 12 CFR 9.18 8 tracked common law, and that's the reason that regulation was 9 imposed not only on national banks but also on all member banks, 
10 and ultimately on thrifts, because the Federal Home Loan Bank 11 Board adopted that same regulation vis-a-vis the trust 12 departments. 13 So Your Honor, we're not dealing with ambiguities here, 14 we're dealing with facts. We're dealing with record evidence of 15 admission that this is a common trust fund. 16 As this Court knows, equity, equitable restitution, is 17 in fact the mirror image of damages. And that is, Your Honor, 18 it's not a cute phrase or anything else; you look in the mirror 19 and you're seeing the opposite of what you are. It is 20 substantive. It has been that way for 700 years in restitution, 21 and it's preceded the first 100 years of trust law development. 22 And it moved for the most part in accordance with each other as 23 the development evolved, including in this country, Your Honor. 24 The confusion started in this country in 1937, when 25 equity and law were merged, and because equity and law were 
Page 48 
1 merged, the issues with regard to the specifics and precision in 
2 pleadings were no longer necessary because there was no 
3 consequence. That didn't eliminate the fact that the 
4 substantive distinctions exist, and in fact, this Court 
5 correctly pointed out in its January 30th decision that this 
6 area of the law is murky. 
7 If you read the authorities, whether you're looking at 
8 Dobbs or you're looking at Scott or you're looking at Bogart, or 
9 you're looking at the comments from the draftsmen of the 10 restatement, they all say the same thing. There has been casual 11 use of the terms because it was unnecessary to be more specific. 12 We, however, are in a different situation. The 13 uniqueness of law in equity exists and has existed since this 14 government consented to its waiver -- or waived its sovereign 15 immunity. Actions for damages at a certain level are brought in 16 the United States Court of Federal Claims, actions with regard 17 to equitable issues have always been, since the Constitution and 18 since the Judiciary Act of 1789, the province of this Court. 19 That's what we invoked. We were not trying to be cute 20 to get around issues that exist. These issues were stated quite 21 clearly. We never sought damages. What was stricken from the 22 complaint were common law claims, and what the Court of Appeals 23 in Cobell VI stated was, the statutory duties are informed by 24 common law. It was absolutely unnecessary to have common law 25 claims. 
Page 49 
1 Cobell VI also determined that unless there is a clear 
2 statement by Congress to the contrary, all traditional trust 
3 duties apply to the government. With respect to the management 
4 of the Individual Indian Trust, it's one trust with many 
5 designated accounts, like every other commingled trust in the 
6 history of this country exists, Your Honor. 
7 So we are dealing with a situation that there was no 
8 cuteness, there was no attempt at semantical games. As a matter 
9 of fact, on November 23rd, 1998, in the beginning of a two-day 10 hearing before Judge Lamberth, that very issue was argued again 11 by defendants -12 THE COURT: Mr. Gingold, with respect, I imagine you 13 are responding to what I said a few minutes ago about watching 14 the plaintiffs try to dance around this rock that was in their 15 way. But to use another metaphor, you are kind of kicking in an 16 open door here. I have accepted the proposition that what 17 you're seeking is equitable relief and not damages. That's why 18 we're still here. 19 What I want to know is why you think you are also 20 entitled to something that most people would consider interest, 21 and what I've carefully not called interest but have called the 22 time value of money. 23 I understand, too -- well, I've read Judge Boggs and 24 $277,000 of U.S. Currency, and I'm generally familiar with the 25 rulings in that and a couple of other currency forfeiture cases, 
Page 50 1 but you must know that the general thrust of case law considers 2 what you're talking about prejudgment interest, as to which 3 there are serious jurisdictional issues. That's what I want to 4 hear about. 5 And if you want to bring yourself within the ruling 6 that Judge Boggs made, how do you expect to pin down the 7 particulars that he required in the remand in that case? 8 MR. GINGOLD: Well, Your Honor, first of all, we are 9 not asking for the time value of money. That's why we were 
10 asking for the costs saved by the government. 11 But with respect to the time value of money - and Your 12 Honor, it's an important distinction - several measurements are 13 established throughout case law and throughout the various 14 authorities as to the measure of the unjust enrichment, one of 15 which, which is probably more frequently used than any of the 16 others, is referred to, as you note, as the time value of money. 17 That necessarily implicates, Your Honor, the interest 18 that was earned by the trustee on the assets of the trust 19 beneficiary. It wasn't interest earned that was to be payable 20 to the trust beneficiaries if they sought that, it was the 21 actual benefit that was obtained as a result of the breach of 22 trust. 23 Your Honor, but the cases go further in that regard. 24 Again, we're not asking for time value of money, but I would 25 just like to explain the distinction. 
Page 51 1 THE COURT: Actually, well, I think I understand the 2 distinction. But since you insist on the distinction, it seems 3 to me the proof that the government actually benefitted is a lot 4 harder than just taking T-bill rates or Treasury bond rates over 5 the number of years. You've got to prove something more than 6 that, I think. 7 MR. GINGOLD: Your Honor, with all due respect, I am 8 assuming a couple of items here. Number one, this is a trust, 9 number one, that the trust duties that apply to ordinary 
10 trustees in this country apply to the government as trustee for 11 the Individual Indian Trust, unless Congress unambiguously 12 states to the contrary. And I'm assuming, Your Honor, this is a 13 commingled trust, and I'm assuming, Your Honor, that the duty to 14 account has been breached. 15 And I'm assuming, Your Honor, what funds have been 16 withheld improperly, and therefore we're looking at another 17 breach based on what every authority that I've looked at agrees 18 is a breach, and that's the failure to disburse funds to the 19 trust beneficiaries that are obligated to be disbursed. 20 But maybe I can start off more easily with Cobell XVIII 21 and Judge Williams' statement on December 10th, 2004. 22 Judge Williams stated, "As trust income beneficiaries are 23 typically entitled to income from trust assets for the entire 24 period of their entitlement, to income and for imputed yields 25 for any period of delay in paying over income or principal, we 
Page 52 1 do not see and plaintiffs make no effort to explain how the 2 accounting delay could deprive them of interest or any 3 comparable returns." Your Honor, Judge Williams also cited 4 Bogart at Section 814, 321 to 325. 5 Your Honor, prejudgment interest would reflect 6 something that would be -- that is an entitlement simply based 7 on the delay of payment as opposed to the interest earned and 8 has been credited. One of the distinctions this Court has 9 correctly made, when it identified the collection issue as 
10 distinguished from funds that should have been collected and 11 that weren't, we aren't looking in this litigation -- which is 12 one of the reasons Mr. Smith was correct on his statement of 13 preclusion and what's available. We never were looking at what 14 should have been collected and isn't, whether or not it was $5 a 15 barrel as opposed to $105 a barrel. That's not part of this 16 case. The accounting would have revealed that. 17 We're not looking at whether our clients were paid 18 three percent, when the prevailing rate, let's say in the 19 1980's, was 20 percent. That's not part of our case. 20 What we're looking at, Your Honor, is what has been 21 collected, what has been deposited, what has been invested in 22 common, and what in this case has been withheld. 23 So Your Honor, we are not looking at what this Court 24 has accurately characterized as a damages claim, and therefore, 25 Your Honor, the prejudgment interest would fit in that same 
Page 53 1 category. To the extent we are asking for interest that should 2 have been paid to our clients, and as a result, an injury is 3 sustained, we would agree that would be prejudgment interest so 4 long as that met within the standard set forth by 5 Judge Williams. 6 But that's not what we're asking for, Your Honor. When 7 we point out, as we have with regard to cost savings, it's what 8 the government benefitted from the withholding. There are a 9 line of cases -- and again, I'm saying as opposed to the time 
10 value of money, which is the principal way plaintiffs have 11 established the amount for restitution, we chose not to do 12 that -13 THE COURT: All right. Let's just -- let's get rid of 14 the term "time value of money," since it upsets you so much. 15 MR. GINGOLD: I'm not upset, Your Honor. 16 THE COURT: Let's talk about actual gains to the 17 defendant from using the benefits. Okay? 18 MR. GINGOLD: Yes, Your Honor. 19 THE COURT: How are you going to prove actual gains to 20 the defendant from use of the benefits? 21 MR. GINGOLD: Well, first of all, Your Honor, 22 Commissioner Gregg in his testimony in 1999 specifically 23 testified, as we've cited in our briefs, that the money that is 24 not disbursed to the trust beneficiaries is in the Treasury 25 general account, and that that money is used either to reduce 
Page 54 1 the amount of debt that exists or allows the government not to 2 borrow based on the funds that are held in the Treasury general 3 account, which, Your Honor, is also a commingled account. 4 There is admission that that benefit accrues to the 5 government. The commissioner at that time specifically said 6 that. He was examined several times on that issue, and each 7 time the conclusion was consistent with what I just stated. So 8 there is an admission with regard to the benefit conferred, Your 9 Honor. 
10 Calculating that raises interesting issues as well, 11 because there are separate and special rules when trust funds 12 are commingled, whether they're just commingled with other 13 members who are trust beneficiaries of the same trust, whether 14 they're commingled with third parties, or they're commingled 15 with the government. In our case they've been commingled with 16 everybody, including tribes. 17 Therefore, the proofs after the admission that there's 18 a benefit conferred would be shifted to the government. That's 19 an important factor, because it's the government that has all 20 the records, it's the government that determines what's 21 invested, it's the government that has the records to determine 22 where the funds are allocated within the entire Treasury 23 Department at any point in time. 24 So we would have hoped, Your Honor, that an accounting 25 would have revealed all of this so we wouldn't have to rely on 
Page 55 
1 presumptions. But because the accounting hasn't been revealed, 
2 we're left with alternative remedies. 
3 Now, let me point out, the reason we said in our brief 
4 that these remedies are independent, equitable remedies are 
5 independent whether or not you ask for an accounting, Your 
6 Honor. The fact that an accounting has been deemed to be 
7 impossible only means that our choices become more limited on 
8 what we would have wanted to do if the accounting was rendered. 
9 Once the accounting was rendered, choice could have been a 10 variety of things, as we've stated ad nauseam in our briefs, so 11 I'm not going to repeat that. 12 But nevertheless, those remedies existed because of the 13 nature of the trust itself, just as the duty to account inheres 14 in the nature of the trust itself. 15 Going further, with regard to -- I think you pointed 16 out there are periods of time that the government may not have 17 borrowed and there are periods of time when the government 18 borrowed quite a bit. And we can take the Depression, where the 19 borrowing was thin except from JP Morgan, because there was no 20 money available for the government to borrow. 21 The key question that is raised in each one of those 22 cases is in fact not what the breaching trustee actually 23 benefitted, it's what he could have benefitted if he used those 24 funds properly. 25 In the example that's given in one of the cases, Your 
Page 56 1 Honor, that we've cited, an individual who took control of an 2 apartment building, the question -3 THE COURT: Wait a minute. You've cited all these 4 cases that say actual gains, not theoretical gains or what the 5 gains might have been. 6 MR. GINGOLD: No, we've also cited cases -- I know our 7 briefing is voluminous. We've also cited cases that identify -8 as a matter of fact, I think it's in one of our footnotes that 9 identified cases which establish the measurement by what either 
10 the breaching party would have had to pay if the property wasn't 11 misappropriated, and that involved egg-washing machines and the 12 theft or conversion of accounting papers. 13 There was another case, Your Honor, that was referenced 14 with regard to a party that took over an apartment building, 15 only leased out certain of the apartments, but the 16 restitutionary award was based on the amount that the party 17 could have rented those apartments for during the time it had 18 unlawful possession. 19 So Your Honor, we cited -- most cases deal with the 20 actual; many cases deal with the position that the breaching 21 party was in during the period of time that party had 22 possession. All those cases are cited. And they also reference 23 provisions of the restatement of restitution in that regard, and 24 I believe Dobbs as well. 25 So this is an area of law that is complicated and it's 
Page 57 1 materially different from damages. Every time the case is 2 identified as an example or not an example of whether or not it 3 should be an opt-out or not an opt-out case, those cases, Your 4 Honor, in fact are damages cases, and there's a different theory 5 and different policy with regard to that. 6 I would like to turn this Court's attention, for 7 example, to footnote 11 of page 14 of plaintiffs' reply brief, 8 which deals explicitly with two cases dealing with the issues I 9 was referencing. Dobbs is identified as well in that footnote 
10 at 5.8(3), at 933, note eight, when there's a negative unjust 11 enrichment issue raised. 12 Your Honor, one of the key factors, whether we're 13 dealing with Dobbs or we're dealing with any other authority, 14 and that's Bogart or Scott or the restatement, which 15 Professor Langbein says is the premier authority on trust law in 16 this country, and I presume he also means restitution, since he 17 has contributed to it, we're dealing with the same thing. We're 18 dealing with a measurement solely of whatever is determined to 19 be a reasonable benefit -- or a benefit that can be calculated 20 reasonably to be obtained through either a violation of law or a 21 breach of trust, or some other interference with a plaintiffs' 22 rights. 23 In our case, Your Honor, we have all of those here. So 24 therefore, when plaintiffs need to make the determination 25 because of the absence of the accounting that has been an 
Page 58 1 obligation of the government since the beginning of this trust 2 and Your Honor, as Cobell VI pointed out in noting Mitchell 2, 3 it's a duty that inheres in the nature of the trust relationship 4 itself - so without that, we're left to something that is 5 extremely rare in the law, a trustee that has been found and 6 noted by the Court of Appeals to have mismanaged this trust as 7 long as this trust has been in existence, and now the failure to 8 render the accounting that has been an obligation that is 9 inherent in the nature of the relationship. 
10 The fact that that accounting duty has been deemed to 11 be rejected -- I will not use the term "repudiation," but 12 rejecting the rendering of the accounting duty and making the 13 accounting impossible leads plaintiffs as a class with one 14 remedy, and that is restitution. 15 And as a matter of fact, Your Honor, all the 16 authorities say the same thing as well. One of the reasons that 17 plaintiffs seek restitution as opposed to damages is because of 18 the difficulty, or in some cases impossibility, of quantifying 19 what the damages would be, whether it's because trust records 20 have been destroyed or whether or not there's another factor 21 that makes that impossible. 22 So Your Honor, the remedy that we're talking about 23 exists independently of the duty to account in the context of an 24 express trust. And, Your Honor, it also exists as one of the 25 remedies that are available once the accounting is completed, 
Page 59 1 and once this Court determined it was acceptable, and once the 2 individuals had the ability to make an informed judgment as to 3 what next should be done. That has been taken away from them, 4 Your Honor, after 12 years in this litigation. 5 Your Honor, from the very beginning we've had these 6 same arguments. And again on November 23rd, 1998, Mr. Holt, in 7 response to questions from Judge Lamberth, responded, Your 8 Honor, we want the return of our money that has been wrongfully 9 withheld, and we believe that -- as a matter of fact, we 
10 explained that funds have been collected into the Treasury that 11 are revenues from the Individual Indian Trust corpus, but they 12 weren't designated properly. Therefore, if 10 items were 13 collected, six of them could conceivably be identified as not 14 trust money, although it was deposited and held by the 15 government, and for it could be held. We wanted the six that 16 was collected and deposited, and then -- we wanted recovery of 17 that, and then we wanted the accounts restated to reflect 18 accurately what had occurred. Your Honor, this was from the 19 very beginning. We didn't dance around anything. 20 Now, another important point in that regard. When it 21 is determined, and the government has acknowledged through its 22 own various uses of throughput and other documents that have 23 been provided to this Court that money has been withheld, or it 24 cannot account for the funds that it acknowledges are collected 25 but are not distributed, those funds, Your Honor, are Page 60 
1 presumptively determined, or should be presumptively determined 
2 to be withheld, unless, as every single authority states, 
3 whether you're dealing with a trustee generally or a commingled 
4 trust in particular, the trustee identifies why those are not 
5 the funds of the beneficiary, why that particular number is in 
6 error, and it's able to prove that. 
7 That is in every single authority, Your Honor. It's 
8 not just plaintiffs' -
9 THE COURT: Mr. Gingold, with respect, you're kind of 10 starting to repeat yourself. I mean, we've all been over this 11 many, many times. 12 Let me ask you a hypothetical question. Suppose, just 13 suppose that the funds that cannot be accounted for were not in 14 fact withheld, that everybody knows that they were actually 15 paid, it's just that we can't account for them. 16 Now, one might conclude in responding to that, if that 17 were the fact, too bad, government, pay it again because you 18 can't account for it. That's what a trustee has to do. You 19 can't account for it; you say you paid it, we're not going to 20 assume you withheld, you just blew it way back 50 years ago. 21 Somebody wasn't keeping records or you lost those records in a 22 barn, and they were eaten by rats or whatever else you assert 23 actually happened. Yeah, the money was probably paid, yeah, 24 most of it was probably paid; you can't account for it, pay it 25 again. Okay? That's the hypothetical. 
Page 61 1 Why should the plaintiffs be entitled to any more than 2 just the money, if that were the fact? Why should they be 3 entitled to money that the government did not in fact withhold 4 and use and keep in some other way? Why should I make the 5 presumption that the money was withheld and kept? 6 MR. GINGOLD: Well, I'll answer your last question 7 first, if I may, Your Honor. Because that's what the law is. 8 Where the trustee is maintaining the books, where the trustee is 9 maintaining the funds, where the trustee is making the 
10 distributions, and in many cases the checks are sent through the 11 trustee's own superintendents, the law says the obligation is 12 the trustee's. And particularly, Your Honor, where it's a 13 commingled trust, where it's even more complicated. That's what 14 the law says. 15 THE COURT: I mean, the government points out correctly 16 that in my findings and conclusions back in January, a major 17 element of the finding that the shortfall may be between 3 and 
18 3.6 billion dollars is the fact that for a whole long period of 19 time, there are no records of what disbursements were made. And 20 I said from the bench, come on, everybody knows these 21 disbursements were made, or some of them or most of them; you 22 just can't prove it. 23 Now, what benefit did the government, actual benefit do 24 you think the government retained from the use of monies that it 25 in fact paid but just can't account for? 
Page 62 1 MR. GINGOLD: If in fact it paid for it and can't 2 account for it, Your Honor, I don't know how you can make the 3 assumption they were paid. 4 Your Honor, we assumed in our model that we presented 5 in our opening brief and I discussed during the hearing we had 6 previously, we assumed every check that was cut and identified 7 in the CP&R, the Treasury database from Interior information, we 8 assumed every one of those payments were made to the 9 beneficiaries. 
10 And actually, Your Honor, whether it's 3 or 3.6 or 11 4 billion dollars, or a little more than that, that has nothing 12 to do with the checks they say were cut. We're looking at their 13 data. Their data doesn't support that assumption, Your Honor. 14 The assumption we made is an assumption that's not 15 required for any beneficiary in a case such as this, with regard 16 to an express trust or with regard to an express trust that's 17 commingled independently. 18 The assumptions are that the funds were not spent 19 unless the trustee can prove they were. That is the presumption 20 in the law, and it's been that way forever. Judge Lamberth in 21 one of his summary judgment decisions, I believe it was in March 22 of 2003, explicitly identified what needed to be done for 23 proof -24 THE COURT: Yeah, I understand that. My question is, 25 does the presumption extend the next phase to the amount of 
Page 63 1 money that you are calling the actual benefit to the government? 2 MR. GINGOLD: Yes, it does, Your Honor. And it's very 3 explicit in that regard for all the reasons that we've mentioned 4 in our briefs. It is the duty of the trustee to maintain 5 adequate records, it is the duty of the trustee to maintain 6 adequate systems, and it is the duty of the trustee to maintain 7 adequate staffing. Cobell VI explicitly stated those are 8 subsidiary duties of the duty to account, and the duty to 9 account cannot be discharged unless that is done. And that is 
10 precisely the situation we're into today. 11 As a result, Your Honor, the amount that has been 12 identified that the government cannot prove -- and as a matter 13 of fact, Your Honor, in reality the government should have to 14 prove every single disbursement out of the trust, because 15 otherwise it's presumably, based on the law, not to be a 16 disbursement of the plaintiffs' money; rather where it's 17 commingled in a case like this, it would be a disbursement of 18 the trustee's own funds. 19 So Your Honor, that is the problem when you breach the 20 trust duty. That is the problem when you don't maintain 21 adequate records. The Court of Appeals didn't say there's an 22 exception in this case for Indians, Mitchell 2 didn't say 23 there's an exception for Indians, and you'll never see anything 24 in a restatement of trust that says that either, Your Honor. 25 A trustee is a trustee is a trustee. That's been the 
Page 64 1 foundation of the law in this country since the time it was 2 founded. The government has provided no statutory authority 3 where Congress has explicitly and by necessary implication 4 changed those trust duties, notwithstanding all the action that 5 has occurred in the 12 years of this litigation with regard to 6 issues on the Hill. 7 So Your Honor, that is precisely why those presumptions 8 are in play, because of the recognition that there's no way the 9 trust beneficiaries would be able to have that sort of 
10 documentation. The government has had years to make those 11 proofs in this case, and hasn't done so, and, by its own 12 admission, as a matter of fact, destroyed, if not all, nearly 13 all of the checks prior to 1992. 14 And Your Honor, this is an important factor. Equitable 15 restitution and disgorgement is two components. One is to 16 divest what has been characterized as unjust enrichment by the 17 courts and by all the authorities, and that which the trustee 18 profited as a result of its breach of trust. 19 THE COURT: But in my hypothetical they haven't 20 profited. 21 MR. GINGOLD: By your hypothetical, Your Honor, they 22 haven't proved it, so as a result, they lose. That's what the 23 law is. 24 THE COURT: But the question is, does the burden shift 25 on that issue? 
Page 65 1 MR. GINGOLD: Well, every single authority that I've 2 read for 700 years says so, Your Honor. 3 THE COURT: You've been reading for 700 years? 4 MR. GINGOLD: Your Honor, I went back to the 5 original -- as a matter of fact, the original restitutionary 6 cases - yes, I did - to look at those cases, and Your Honor, the 7 only thing that's happened is it's actually become worse for the 8 trustee. And the original cases were principally cases dealing 9 with the claims between the beneficiary and creditors of the 
10 trustee. That's the reason the concept of the res and 11 subrogation and constructive trusts were established. So yes, I 12 did go back that far, and yes, Your Honor, this is what the law 13 is. 14 But this is an important point. Restitution involves 15 deterrence as importantly as it involves divestment of unjust 16 enrichment. What is necessary to encourage the trustee -17 THE COURT: You're losing me on your deterrence point. 18 I'm sorry, deterrence -- I have tried very hard in what I have 19 written on this case so far not to start allocating blame. I'm 20 not doing that. 21 MR. GINGOLD: It's not a question of -- Your Honor, 22 this can be on a neutral basis. Let me explain. We're not 23 trying to allocate blame either. Let's take a simple issue. 24 There's a duty to account, and there are subsidiary duties 25 that have been -
Page 66 1 THE COURT: How about incentive instead of deterrence? 2 I'll accept that. 3 MR. GINGOLD: Your Honor, however Your Honor -4 THE COURT: More positive thinking, Mr. Gingold. 5 MR. GINGOLD: Encouragement. 6 THE COURT: All right. Good. 7 MR. GINGOLD: So Your Honor, one of the important 8 points of restitution is encouragement, to encourage the trustee 9 to discharge the trust duties prudently. 
10 And Your Honor has pointed out that it's necessary to 11 make sure that the trustee understands how much he is encouraged 12 to do his job as well as he can, prudently, under the 13 circumstances. It's a reasonable, prudent man standard, Your 14 Honor, it's not an absolute standard. But as this circuit 15 pointed out, and this Court itself has pointed out numerous 16 times, one of those duties is to maintain adequate records. You 17 don't do so, you're going to be encouraged. 18 THE COURT: I think we've flogged this moribund animal 19 long enough. But let me say in the nature of fair warning to 20 the plaintiffs, don't assume that the actual gains to the 21 defendant from using the benefits are proven by the inability of 22 the government to account for disbursements. I want to think 23 about this a little bit more, and this has been a useful 24 discussion, but I think the presumptions go in opposite 25 directions and I think the burdens go in opposite directions. 
Page 67 1 And I think the plaintiff will have the burden of proving that 2 actual gain proposition that supports something like 55 million 3 of your 58 -4 MR. GINGOLD: Billion. 5 THE COURT: -- billion dollar ad damnum. 6 MR. GINGOLD: Your Honor, we understand that. We would 7 like to note that a fiduciary who does not maintain adequate 8 records is not permitted to take advantage of that circumstance. 9 That is another rule of law with regard to management of the 
10 trust and the fiduciary duties that have existed in this 11 country. 12 So to the extent the government doesn't have the 13 records, that trustee would be taking advantage of exactly what 14 the Court of Appeals identified in Cobell VI as a breach of a 15 subsidiary duty, and as a matter of law, the trustee is not 16 permitted to take advantage of that. 17 So the position that trust beneficiaries would be 18 placed in is exactly what every major, every decision that I'm 19 aware of in this country and elsewhere under these circumstances 20 has said, this is the burden that's shifted to the trustee. 21 Once plaintiffs are able to establish a reasonable 22 approximation of what the award should be - and Your Honor, the 23 reasonable approximation is based solely on the government's 24 production and the government's data, it is not based on 25 anything that has been manufactured by plaintiffs - is it a 
Page 68 1 large amount of money, Your Honor? Yes, it is. But billions of 2 dollars have come into this trust; from the very beginning there 3 have been serious issues with regard to how the trust has been 4 managed. It doesn't make any difference which administration it 5 is, Your Honor. And as a result, we are dealing with an 6 accumulation of problems that is unfortunate, but it is reality. 7 To place that burden on the trust beneficiaries, where 8 the trustee has not discharged the trust duty that is inherent 9 in a trust relationship itself, Your Honor, would be 
10 unprecedented based on my understanding of the law. 11 THE COURT: Okay. Well, you've said what you have to 12 say, I've said what I have to say, and we have to move forward 13 toward our June 9th trial. And I'm just telling you what I 14 think you better consider trying to prove. 15 MR. GINGOLD: Your Honor, one last thing in that regard 16 and I won't say anything further. 17 As I mentioned, plaintiffs are assuming that every 18 check that the government says were cut to trust beneficiaries 19 were actually paid to them, without any proof of that. We are 20 assuming that 100 percent. That is a burden that we have lifted 21 from the government that is not necessary with regard to any of 22 the cases that I've ever seen. Your Honor, we're using the 23 government's data to do that. We're using the CP&R data, and we 24 explained that both in our opening and our reply brief. 25 So we are not suggesting that even a check that went to 
Page 69 
1 a superintendent in care of a beneficiary, and where there's no 
2 endorsement, even if a check exists, we're not talking about the 
3 fact that -- we're not presuming the check that was identified 
4 to the beneficiary hasn't been paid. 
5 The government itself, whether you're looking at I 
6 think -- and by the way, you'll find that on page 48 of our 
7 reply brief. Whether you're looking at any of the major 
8 documents that we've cited, whether it's AR-171, AR-176, or 
9 DX 356, this is the government's data, and we didn't create it, 10 we didn't segregate it. It wasn't identified to us, it just 11 wasn't presented to you, Your Honor. 12 The issue that did remain that we excluded, Your Honor, 13 was the issue of the ACH or electronic funds transactions, where 14 there's absolutely no evidence that has been presented in that 15 regard. And Your Honor, I think that accounts, for the limited 16 period of time that that was available, upwards of one and a 17 half percent of the transactions. So at least on its face it 18 may not be material. 19 I would also like to point out, Your Honor, electronic 20 funds transactions didn't really exist in substantial form until 21 the mid '80s, and there weren't too many EFT or ATM terminals on 22 Indian reservations. So the reality is, that's the one area we 23 did not give the government full credit. 24 We also did not give the government full credit when it 25 arbitrarily established a 15 percent amount of money in the 
Page 70 1 so-called Tribal IIM Trusts. Your Honor, there is absolutely no 2 evidence to support that whatsoever, and in fact, to combine 3 tribal money in an Individual Indian Trust was in violation of 4 the government's own regulations. 5 So we tried to accommodate what we thought the Court 6 wanted, and that is to use concrete information that has been 7 provided by the government so we could avoid some of the issues 8 as to whether our data is better than the government's data, and 9 so we can streamline the proceeding. We used that and presumed 
10 100 percent disbursement for checks the government was able to 11 identify, or at least where a beneficiary was the payee. So we 12 did that, Your Honor. 13 But the government admits in its various documents and 14 even in testimony that distributions from the trust went to 15 third parties, whether you're dealing with corporations that 16 were lessees or whether you're dealing with tribes or you're 17 dealing with something else, including the government, with 18 regard to the payment of administrative fees. 19 So Your Honor, it's not every disbursement from the 20 trust that is a disbursement to the trust beneficiary, and the 21 government's owned admissions and documents demonstrate that. 22 So we tried to do what this Court asked for. That's 23 the reason we have this 70 percent disbursement rate. That 24 reflects the checks the government identified for the period of 25 time that it was available that were paid out, and it compares 
Page 71 
1 the amount of money the government acknowledges was collected. 
2 That is the shortfall. 
3 THE COURT: Look, Mr. Gingold, if we're talking about 
4 the 69 or 70 percent factor and the way you've calculated it, if 
5 you're going to stick with that, then that's something we're 
6 going to have to sort out on June 9th. I can't sort all of that 
7 out today. In fact, I didn't quite follow it in your briefs. 
8 And it is a method of proof that is -- you know, when I 
9 was in law school, there used to be a whole stack of books in 10 the library called Proof of Facts. I don't think they do Proof 11 of Facts anymore. I'm not sure that would have made it into 12 Proof of Facts. 13 But -14 MR. GINGOLD: Your Honor, it may have in the trust. 15 THE COURT: -- we'll see. If that's your proof, we'll 16 see. 17 MR. GINGOLD: Your Honor, that's the proof that the 18 government acknowledged with regard to the difference between 19 the amount it acknowledged it collected and the amount that's 20 reflected in the checks distributed. 21 Further, Your Honor, we applied that proof all the way 22 back from 1991 back to the beginning of the trust, even though 23 there's not an element of proof -24 THE COURT: You will forgive me, Mr. Gingold, if I tell 25 you that on this issue I have reached some sort of plateau, and 
Page 72 
1 I expect to hear testimony about it in June. Because arguing it 
2 at this point isn't getting either one of us anywhere. 
3 MR. GINGOLD: No, I understand that, Your Honor. I was 
4 just pointing out, we were relying on what we understood this 
5 Court wanted to give some certainty to a number as opposed to 
6 every number in dispute, and we made assumptions in that regard. 
7 THE COURT: All right. 
8 MR. GINGOLD: Further, Your Honor, we were also relying 
9 on what the law is with regard to presumptions in the trust 10 situation. 11 THE COURT: Now, what's your view of what needs to be 12 proven and -- proven, and by whom, at the June 9th trial, 13 Mr. Gingold? 14 MR. GINGOLD: The view that we expressed in our brief, 15 Your Honor, as tempered by the consideration, at least as we 16 understand your comments today, we understand that there's been 17 approximately, based on, again, using solely the government's 18 production, something over $15 billion that's been collected in 19 the trust; based on the government's production, something over 20 $10 billion has been paid out of the trust by check. 21 THE COURT: Does that include the Osage headrights 22 dollars? 23 MR. GINGOLD: Yes, it does, Your Honor. It includes 24 that -25 THE COURT: Let me ask you this. 
Page 73 
1 MR. GINGOLD: Sure. 2 THE COURT: If a billion dollars of the asserted 3 shortfall is related to the Osage headrights, how are you going 4 to support per capita distribution of that to all Native 5 Americans, no matter what their tribes are? 6 MR. GINGOLD: Your Honor, that's precisely why we 7 explained that this restitutionary award, historically and 8 today, is irrelevant to the injuries sustained by any individual 9 plaintiff. The class as a whole is entitled to it. 
10 To the extent -- Your Honor, the cases, as Mr. Smith 11 pointed out correctly, are the following: There are cases that 12 say plaintiffs can elect an award, and if that award is 13 restitution - and generally, Your Honor, if you look at those 14 cases, it's where the restitutionary award is actually more than 15 the damage sustained by the beneficiaries, because there's no 16 correlation between the two - then they would be precluded from 17 seeking damages claims either in that same court or in another 18 court. 19 There is also a case that specifically says that 20 damages claims in the same court can be tried by a jury, where 21 the equitable restitution claims must be determined by the 22 judge, and then the judge fashions that out. They've always 23 been recognized as different. 24 There's also a situation where if in fact they can't 25 prove the damages because the evidence isn't there, the trust 
Page 74 1 beneficiaries are generally left to a particular restitutionary 2 amount because the damages can't be proven. All of this is the 3 reason that restitution has evolved to where it is. 4 We have a unique situation in that regard because this 5 Court has certain jurisdiction and the claims court has certain 6 jurisdiction. We did not, when we filed this case, and do not 7 now, attempt to recover damages for any member of the class. We 8 hoped that the accounting would reveal, with adequate 9 information, what the issue is, whether or not the beneficiary 
10 chose to go after an oil company, for example, because of an 11 underpayment that would be disclosed in the accounting. Not 12 that this Court should do anything about that, but if an 13 underpayment in royalties existed vis-a-vis Exxon, why shouldn't 14 the beneficiary be able to go, if that beneficiary chose, into 15 in U.S. District Court to recover that in damages? 16 If in fact it was determined that the money was 17 collected but not paid out, that isn't damages, Your Honor. If 18 it wasn't collected pursuant to a lease term, then that would be 19 damages. And if it would be identified in the accounting, then 20 they could do so. 21 What Mr. Smith was identifying was there is a pragmatic 22 consequence to not having an accounting, and that's to being put 23 in a position to make an informed decision about what remedies 24 to seek in the trust. That's the reason the accounting is 25 always the starting point, Your Honor, and the documents are 
Page 75 1 always a starting point. Once the information is rendered, then 2 the decisions are made. 3 Here, there is no choice, from the class point of 4 view -5 THE COURT: Now hold it. I'm still waiting for an 6 answer to my question. I'm not sure that I've got it. My 7 question was, if a billion dollars of this amount that you're 8 starting with is the corpus from which you add all of the, what 9 we've both decided we will not call the time value of money, if 
10 a billion dollars of that is attributable directly to the Osage 11 headright claim, why shouldn't a billion dollars of it go back 12 to the Osage? You've got it in this undifferentiated cloud 13 somehow. 14 MR. GINGOLD: Well, Your Honor, if we're dealing with a 15 benefit conferred on the government -16 THE COURT: Yeah, okay. 17 MR. GINGOLD: -- so without any injury to the 18 individual -- and that's what the concept of the benefit 19 conferred is. It distinguishes the two. Your Honor, there's an 20 argument that can be made that inasmuch as there is no 21 correlation between the award and the injury to any member of 22 the class, that the award should be per capita. 23 On the other hand, Your Honor, if this Court determined 24 that that is unfair, pursuant to a fairness hearing, this Court 25 could determine whatever it wants to do. 
Page 76 1 All we were pointing out is this reinforces strongly 2 the distinction between an allegation that we have a damages 3 claim that's characterized or cast as a restitutionary award. 4 It isn't, Your Honor. Restitutionary award is based solely on 5 what benefit has accrued to the trustee. It has nothing to do 6 with any injury to a single beneficiary. 7 Under those circumstances, it would seem to me, Your 8 Honor, that allocation based on amount of interest or 9 speculative recoveries or collections is irrelevant to what is 
10 involved in a restitution. On the other hand, if this Court 11 wanted to make that allocation under those circumstances, we 12 wouldn't object. 13 We want to do a couple of things, Your Honor. We want 14 it to stay as far from the line, wherever that is, between 15 damages and restitution as possible. And there are issues. 16 THE COURT: I got that part. That's loud and clear. 17 MR. GINGOLD: But once you start making an assessment 18 on an individual basis, then the argument can be made with 19 regard to whether or not you're dealing with an element of 20 compensation or substitutionary relief to the beneficiary, or 21 are you truly dealing with a restitutionary award that is 22 independent of the injuries sustained. 23 We wanted to stay on the right side of the line. We 24 didn't want to have obfuscation or confusion above. This area 25 of the law, as Dobbs says, is one of the most confused areas of 
Page 77 1 the laws that exists, and we wanted to keep it simple. But Your 2 Honor, we wouldn't have an objection if you chose to allocate 3 differently. 4 THE COURT: Well, and of course that begs the question 5 of whether the Osage headrights belong in this corpus at all -6 MR. GINGOLD: That's correct. 7 THE COURT: -- since the money never came into the IIM. 8 MR. GINGOLD: And Your Honor, the money came into the 9 government or was held in the Treasury, and the fact it didn't 
10 go into the system is irrelevant to the fact that it wasn't 11 deposited in the Treasury. It was deposited and held in the 12 Treasury, Your Honor. It wasn't held in a third party, it 13 wasn't held in the Osage tribe. 14 That is a distinction we were making, and we were 15 trying to identify this in conformity with how this Court 16 distinguished direct pay and compacting and contracting issues. 17 With the compacting and contracting issues, at least as we 18 understood it, one of the reasons -- and with direct pay as 19 well, one of the reasons this Court excluded those monies is 20 because the funds were not held at the Treasury, or an 21 unauthorized representative of the Treasury, whatever that might 22 be. 23 In this case the funds are held in the Treasury, 24 Treasury checks are written to disburse the funds. 25 THE COURT: Did I say anything about Osage headrights 
Page 78 1 in the January 30th opinion? I don't remember that I did. 2 MR. GINGOLD: I don't believe you did, Your Honor, 3 except for the fact that the $13 billion total that was 4 reflected by the government's throughput analysis is a total 5 that incorporates part of the headright revenues, Your Honor. 6 So we were dealing with the statutory authority 7 regarding those headrights, the fact that the funds were always 8 held in the Treasury, the fact that disbursements were made with 9 Treasury checks. Whether a system is a good or bad system or 
10 inaccurate or complete system doesn't determine the nature and 11 scope of the trust responsibility. 12 As Mitchell 2 says, it would be an anomalous situation 13 where the trustee discharges his duty and he's accountable, but 14 when he does not, he is not accountable. 15 That's what we have here, Your Honor, with regard to 16 the Osage. The fact that the government does not issue checks 17 on the 4844 ALC, but it does issue checks with a different 18 agency locator code, doesn't exclude Individual Indian Trust 19 funds that are generated from trust lands and deposited in the 20 Treasury and held in the Treasury, and then disbursed with 21 Treasury checks to be other than Individual Indian Trust funds 22 outside this litigation. That's not what is reflected either in 23 the class certification order or in what we understand this 24 Court decided on January 30th. 25 THE COURT: Okay. Let's see. The government has 
Page 79 1 suggested that although they mightily resist the notion of any 2 award that has a dollar sign in front of it, that such an award 3 in any event would have to be adjusted from the numbers we've 4 been talking about earlier to encompass the accounts for 5 individuals who are dead and have no representatives in the 6 plaintiff class, they would have to net out previous judgments 7 and settlements; they want to argue with you, I'm sure, about 8 the Osage headrights, and they probably want to review much of 9 the material that was covered in the January 30th findings of 
10 fact about what the actual unaccounted for amount of money is. 11 Now, what do you think we're going to be doing in June? 12 MR. GINGOLD: Your Honor, to the extent -- what we 13 understood, and in the briefing that we provided to this Court, 14 was the government would be able to reduce the award or the 15 amount that plaintiffs request based on what it could prove 16 should be outside the scope of this case or what it could prove 17 has been paid out. 18 Let's take an example, Your Honor, the one that was 19 just raised by Mr. Quinn, the previous judgments and 20 settlements. Your Honor, it was suggested there might be a 21 handful, six. I can tell you we're not aware of any that deals 22 with equitable restitution with regard to the benefit conferred 23 on the government for the use of funds. Perhaps the government 24 would be able to provide some insight in that regard so we can 25 look at those cases. 
Page 80 1 And Your Honor, to the extent that an individual did 2 recover previously a damages award that would be in excess of 3 what he may be awarded by this Court, arguably there should 4 be -- it may be appropriate for an adjustment if in fact a 5 correlation is established between the two. And I'm not sure, 6 Your Honor, there is a correlation between damages under any 7 circumstances and unjust enrichment, based on my understanding 8 of the law. 9 With regard to Osage headrights, to the extent, in my 
10 view, Your Honor, that the government can demonstrate that what 11 we've said with regard to the law and practically how the funds 12 have been held are incorrect, that can also be reduced from the 13 amount. 14 With regard to the deceased beneficiaries, as this 15 Court noted, whatever funds should have been inherited by the 16 successors in interest would continue, or at least as we 17 understood what this Court said. So to the extent the 18 government can demonstrate that the successors in interest who 19 are part of the class, and living beneficiaries, either had been 20 paid that money or that the deceased beneficiaries had paid that 21 money so it never was inherited through probate or otherwise, 22 the award should be reduced by that as well. 23 Your Honor, as the government itself pointed out in 24 this court - not in this courtroom, but in this court - with 25 regard to Philip Morris, whatever in that case the government 
Page 81 1 said Philip Morris could prove to reduce the, in that case, 2 $280 billion restitutionary amount that it was seeking under 3 RICO, the government can do that and the award would be reduced 4 accordingly. 5 Your Honor, this is a proceeding in equity and it's a 6 court of law; therefore, whatever proof is provided satisfactory 7 to this Court, plaintiffs concede should be used to reduce the 8 award. Plaintiffs also suggest, Your Honor, that there is more 9 latitude provided in the District Court in an action in equity 
10 than there is in a matter of law. 11 Therefore, fairness, as this Court has pointed out, I 12 think with regard to if we know someone has been paid but there 13 isn't any proof - Your Honor, if we know someone is paid, there 14 isn't any proof, I don't know how we get there - but if we know 15 someone is paid and the proof is lousy, Your Honor, fairness 16 would suggest that that not be credited to plaintiffs, it should 17 be deducted from the amount as well. 18 But Your Honor, part of what occurs in a court of 19 equity involves fairness, involves encouragement, involves 20 dealing with unjust enrichment in this case, and Your Honor, it 21 involves making sure that this case is resolved fairly. And we 22 are in favor of that. That's the reason we adopted the 23 presumptions we did, notwithstanding the fact that in our 24 reading of the law, it wasn't necessary. But we did that to try 25 and reach that fair result. 
Page 82 
1 So Your Honor, we believe this Court does have 2 substantial latitude to fashion a remedy that renders a fair 3 judgment, and does not -- it is not considered Draconian from 4 the point of view of paying beneficiaries this Court knows were 5 paid. We're not interested in that, because we're not 6 interested in what they were paid; we're interested in what the 7 government obtained as a result of its breaches of trust. 8 And Your Honor, this Court found the breaches, the 9 Court of Appeals affirmed them on numerous occasions. So it's 
10 not a pejorative term, it's just a statement of fact, and I 11 don't intend it to impugn anyone's integrity. 12 But Your Honor, we believe that the government has an 13 obligation to demonstrate why the information that has been 14 provided to the plaintiffs and this Court for 12 years is 15 incorrect. And they've provided it, there's been testimony with 16 regard to the benefit, there is a throughput analysis that has 17 been started in 1996, Your Honor, so for 12 years they've been 18 working on this very issue, and they haven't presented that to 19 plaintiffs. 20 We believe, Your Honor, to the extent that information 21 is available that is suggested in defendant's brief, that that 22 information be presented either in the form of an identified 23 potential exhibit or otherwise, so plaintiffs aren't surprised 24 at the proceeding. 25 We believe in that regard -
Page 83 1 THE COURT: Wait a minute. There are a couple of 2 places in your brief where you suggest you want production. 3 We're finished with that, counsel. We are finished with that. 4 There is not going to be any more discovery of any kind. If 5 they present stuff at this hearing in June that you are 6 surprised by, that's why it's a bench conference (sic); we can 7 have a recess and you can explore it. 8 MR. GINGOLD: So Your Honor, we thought it would be 9 done not in the context of discovery, in the context of at a 
10 point in time this Court determines the parties' exhibits should 11 be identified and explained. We're not asking for discovery. 12 That's all. 13 So Your Honor, we did not use discovery -14 THE COURT: I'm running out of time here, and the 15 government hasn't even begun to talk about what they want to 16 call interest and what they want to call the proceedings in 17 June. So I think we ought to let -18 MR. QUINN: Your Honor, if I may beg your indulgence, 19 just one thing Mr. Gingold addressed, just going back to the 20 class issue for a moment and the claims -- the class definition, 21 Mr. Gingold made a reference that it's related to this 22 disgorgement claim. The definition actually is much broader 23 than that. It relates to anyone in effect who -- a class is 24 exclusive of those who prior to the filing of the complaint in 25 this case had filed actions on their own behalf alleging claims 
Page 84 
1 included within the complaint. 2 So it's not necessarily limited to anybody who sought 3 disgorgement or restitution or unjust enrichment. It can be a 4 broader category than. 5 THE COURT: The court reporter needs a break. We will 6 take a short break. I mean short break. We'll reconvene in 7 15 minutes. 8 (Recess taken at 12:27 p.m.). 9 THE COURT: All right. Let's continue. 
10 MR. WARSHAWSKY: Good afternoon, Your Honor. 11 THE COURT: Good afternoon. 12 MR. WARSHAWSKY: John Warshawsky for the United States. 13 Mr. Gingold, as we understand it, pretty much addressed the last 14 two questions that the Court presented. I'm going to be 15 addressing more what I believe was the Court's question four; 16 Mr. Kirschman can address Judge Boggs and the interest issue. 17 THE COURT: Okay. 18 MR. WARSHAWSKY: Your Honor, both parties agreed, at 19 least in their briefs, that in a restitution case, the plaintiff 20 bears the burden of initially establishing a reasonable 21 approximation of the amount to be disgorged. We both cited the 22 same case law on that. 23 Where the parties I think diverged is that the 24 plaintiffs seek to transform that into a very, very light 25 burden. In essence, they seek to discharge their burden with 
Page 85 1 this document here, Attachment A, which is their adaptation from 2 Administrative Record 171, and this document here, Defendant's 3 Exhibit 365, which was the government's -- one of the 4 government's preliminary draft documents provided at the October 5 hearing. 6 The Court, I would submit, should bear in mind that 7 under the law cited by both parties, in a restitution case the 8 plaintiff starts at zero. Now, the fact that there are trust 9 overtones to the case doesn't change that. And the Court said 
10 something this morning which I thought was particularly on 11 point, if I may. You said, "Magic words from 200 years of 12 equity jurisprudence don't fit here." 13 And that's important, Your Honor. Because it's true 14 that if one looks at a basic trust case and asks a trustee to 15 justify a transaction that occurred in a couple of years, and 16 you have a discrete number of transactions, you may, in a common 17 law setting, apply one set of standards. 18 It's quite different for a beneficiary to come back 19 decades later in any setting, but particularly in a government 20 setting, and to seek to impose upon a trustee a duty to prove 21 every single transaction going back a century, or to suffer a 22 presumption that in fact the transaction was not handled 23 properly. 24 The record in this case, which I would like to spend a 25 couple of minutes discussing, does anything but establish a 
Page 86 1 basis for concluding that the trustee in this case should be 2 presumed not to have properly made disbursements to the 3 beneficiaries, that they have unlawfully withheld funds, which 4 is at the heart of a disgorgement action. 5 Now, if I can talk very briefly -- and I respect the 6 Court's time. I know we're moving on. In Attachment A, which 7 is the plaintiffs' adaptation of AR-171, the Court will bear in 8 mind AR-171 was a document prepared for the October 2007 9 hearing. It was denominated a draft document for the purpose of 
10 providing some analysis of collections and disbursements within 11 the IIM system. As the Court noted, for example, in Cobell XX, 12 AR-171 had no disbursements data prior to 1972. This was a 13 preliminary analysis. 14 The plaintiffs' analysis of AR-171, however, contains a 15 number of obvious issues. The Court this morning focused on one 16 that we've obviously noted, the Osage headrights issue. In 17 fact, a great, great predominance of the money, the Osage 18 headright money, never flows through the IIM system. It goes 19 straight from the Osage tribe to beneficiaries. A small 20 percentage, or a minority, at least, a small percentage does go 21 into the IIM system; that's, for example, money paid to 22 incompetents, as to whom the government does serve as a trustee. 23 What Attachment A does is to include all of the Osage 24 headright money, regardless of whether it is money that actually 25 goes into the IIM system. 
Page 87 1 Attachment A includes Tribal IIM money, about one and a 2 half billion dollars of Tribal IIM money. The Court observed in 3 the Cobell XX case, again, Tribal IIM money is a misnomer. This 4 is tribal money that was used where the IIM system had been used 5 as kind of a checking account for tribes, but it was not part of 6 the Individual Indian Money Trust. 7 Now, as we go to trial on this, obviously the Court 8 will hear more evidence about the receipts figures. I would 9 like to point out a couple of problems with the disbursements 
10 analysis in Attachment A. I concede that Attachment A does have 11 disbursement data going back to 1880s; certainly the analysis 12 that plaintiffs, in their opening brief on page 29, where they 13 actually did take the 13 billion minus 10 billion -- or I'm 14 sorry, the 13 billion minus the figure shown on AR-171, they 15 said that gives you 3.6 billion. That doesn't have 16 disbursements before '72. 17 But there is an analysis in Attachment A where they 18 have used a plug disbursement figure, one calculated based on 19 their analysis of the CP&R data for 1988 through 2002. 20 Curiously enough - and it was this 69.82 percent figure that 21 Mr. Gingold referred to - of the 15 or so years in that data, if 22 you look at them individually, nine of the 15 years had a 23 disbursement rate higher than 69.82 percent. 24 If in fact they would have utilized data for other 25 years, pre-'88 years, where they actually had disbursements 
Page 88 1 data - you'll recall from Attachment B they had some years 2 identified where they found data - they would have had a much 3 higher disbursements rate as well. 4 The decision not to utilize -- not to give the 5 government credit for electronic transfers, again that seems to 6 be an obvious flaw with the Attachment A analysis. It's an 7 overly simplistic analysis, which if the burden is shifted to 8 the government, obviously we will be addressing in June. 9 But I would like to get back to this question about 
10 what does the record actually show, and is there any real reason 11 to presume unlawful withholding of funds in the first place. 12 That's important. 13 Plaintiffs do have a burden to show some causal 14 relationship between the harm here, the failure to provide 15 accounting statements required by the '94 Act and the amount 16 that they claim they're entitled to for restitution. 17 Early on, Your Honor, I remember this when you met with 18 the parties after you had taken over the case, you sat down with 19 us and asked, do we have any advice. I'm sure you asked the 20 plaintiffs the same question. And I told you my advice, if I 21 may. I said, forget about the lore of the case; look at the 22 facts. Because the facts are important. 23 The facts in the record of this case show, for example, 24 the paragraph 19 analysis, a $20 million effort conducted with 25 respect to the five named plaintiffs then, and agreed upon 
Page 89 1 predecessors. Contrary to expectations, over 160,000 documents 2 were located to support transactions going back to 1914, and in 3 fact the analysis showed that when Ernst & Young, who conducted 4 the analysis, when they looked at their -- when they projected 5 what transactions should be found in the ledgers based on 6 available leases and other records, they were able to trace 
7 99.99 percent to the transactions ledgers. There wasn't a 
8 great, great hemorrhaging of data between receipts and 
9 disbursements. 

10 The Court will recall, for $20 million dollars, one 11 transaction, a $60.94 transaction that should have been posted 12 to a named plaintiff, in fact was posted to a member of the 13 class with a similar account number. 14 I won't spend a great deal of time talking about it, 15 but the Court, of course, listened carefully and patiently to 16 the testimony about the LSA project last fall. You'll recall 17 that Dr. Scheuren described how when Interior originally 18 designed the 2003 plan, there was an expectation that a great 19 number of transactions wouldn't be able to be vouched because of 20 the inability to find documents. 21 In fact, they vouched virtually every transaction that 22 was sampled. They reconciled 100 percent of the transactions 23 over $100,000, but of the sampled transactions, only a handful 24 couldn't be vouched, and Dr. Scheuren, in his analysis, presumed 25 those transactions were incorrectly recorded. 
Page 90 
1 And the Court will recall what Dr. Scheuren's 2 conclusions were about that. After looking at all the analysis 3 for the LSA, he told the Court with a 99 percent level of 4 confidence, on the credit side, no more than $84 million error; 5 on the debit side, $4 million error. Utilizing more standard 6 95 percent level of confidence, he told you credits, $42 million 7 off; debits $2 million off. 8 That's important, Your Honor. Because these are facts, 9 and it belies the notion that there's been a massive unlawful 
10 withholding of funds. To the contrary, it suggests, as would be 11 expected from a business records system, a great deal of 12 integrity in terms of recording money coming in and money going 13 out, because that's what business systems do. That's what the 14 IIM trust is, it's a business system. 15 Other evidence that the Court has heard, of course, the 16 results of the judgment and per capita analysis, that 86 percent 17 of the accounts have been reconciled, with, as the Court noted 18 in Cobell XX, minimal number of errors noted. 19 The Court heard about things like the data completeness 20 validation, the DCV analysis, the land to dollars pilot, the 21 meta-analysis. All of this is consistent with the notion that 22 the Court should not presume unlawful withholding of funds. 23 Plaintiffs' anecdotal evidence at the hearing last 24 fall, several witnesses talked about incidents; they were 25 investigated, and it didn't result -- and the investigations did 
Page 91 
1 not result in findings of wrongdoing. Nothing wrong. 
2 Back in 2005, for your benefit, of course, prior to 
3 your involvement, when we were having a four-month hearing about 
4 a preliminary injunction on IT security, one of plaintiffs' 
5 witnesses was an auditor with 20 plus years of experience. We 
6 asked her, Ms. Sandy, in all this time, are you aware of any 
7 incident where somebody hacked into the system to take money 
8 from an IIM account? She had never heard of an incident like 
9 that. 10 The evidence in the record is not limited to the 11 electronic records ledger. At trial in June, I anticipate the 12 Court will hear about the efforts conducted by the GAO and the 13 Treasury departments over the period of the 1890's to 1951, 14 where Indian disbursing agent accounts were regularly reviewed 15 by these two agencies and the accounts checked and reconciled to 16 the penny. Again, that type of analysis can't be squared with a 17 presumption of a substantial amount of dollars being unlawfully 18 withheld. 19 So with that in mind, Your Honor, I simply wanted to 20 present the Court the notion that there is a burden of proof in 21 this case, and it is the plaintiffs' burden to start with zero 22 and to prove up. These documents, I would submit to the Court, 23 can't be sufficient to shift the burden. 24 THE COURT: Let me ask you this, Mr. Warshawsky: You 25 suggested that AR-171 was a draft when it was submitted. Does 
Page 92 
1 the government have an updated version of AR-171? 
2 MR. WARSHAWSKY: We are in the process -- yes, Your 
3 Honor, we are -
4 THE COURT: Would you have such a document available 
5 for the trial in June? 
6 MR. WARSHAWSKY: We will certainly have one, yes. 
7 THE COURT: I thought so. 
8 MR. WARSHAWSKY: We have obviously -
9 THE COURT: Let me interrupt you. Let me interrupt 10 this program to note that for many of us, it's lunchtime. And I 11 really don't -- I would -- one part of me says let's continue 12 this until it's done, but frankly I think that would wind up 13 kind of shortchanging some of the arguments that are yet to be 14 made here. And the cafeteria would love to have all your 15 business. 16 And so what I'm going to do is to recess now for lunch, 17 just for an hour, until 1:45. Can we reconvene here at 1:45 and 18 we'll continue? I've got a criminal matter at 2:30, which I 19 think we can be done by 2:30. But if we run past that 2:30 hour 20 a little bit, we will. But I don't want to shortchange anybody 21 on the time they want to spend. 22 And by the way, you mentioned the computer issue. That 23 is an outstanding motion, and if both parties are disposed to 24 give me a few minutes of argument on that after lunch before we 25 quit, I would like to hear that. All right? 
Page 93 
1 MR. WARSHAWSKY: Very good, Your Honor. Thanks. 2 (Recess taken at.12:45 p.m.) 3 THE COURT: Okay. Mr. Warshawsky, where did we leave 4 off? 5 MR. WARSHAWSKY: Your Honor, I just have a couple of 6 points to cover real briefly. We talked before the break about 7 Attachment A and plaintiffs' analysis of AR-171. We didn't 8 spend any time talking about Defendant's Exhibit 365. I'm going 9 to say just a couple of points about this. 
10 This is the basis for the $3 billion number. And 11 again, as the Court will recall, this was also a document 12 prepared in conjunction with the October 2007 hearing. It was 13 denominated by -- it's captioned "proven coverage," and the 14 purpose of it was to come up with an estimate, to prepare an 15 estimate of how much coverage was being accomplished through the 16 historical accounting efforts. It was not designed to provide 17 any measure of amounts that should have been posted to the IIM 18 accounts. 19 And the bottom line is, Your Honor, there's always 20 going to be a difference between amounts coming in, collections, 21 and amounts getting posted to the IIM accounts. Because there 22 are a number of types of collections that simply don't hit the 23 IIM system. We've talked about some of them already today. 24 So I would ask the Court not to draw an inference from 25 the $3 billion delta shown on Plaintiffs' Exhibit 365. It 
Page 94 1 simply wasn't intended to suggest that $3 billion in collections 2 should have been posted to the IIM accounts. In fact, as I 3 indicated, there's always going to be a difference between 4 collections and postings. 5 Mr. Gingold referred to a throughput analysis that he 6 said the government has been working on since 1996. And this is 7 a reference, I assume, to a 1996 document prepared by Dr. David 8 Lasater which was referenced in the plaintiffs' reply brief. It 9 will suffice to say, I've spoken to Dr. Lasater; it was by no 
10 stretch of the imagination a throughput analysis. This was an 11 initial effort to try to come up with some sort of resolution of 12 the matter way back, thankfully, before even I was involved in 13 the case, but it certainly was not a throughput analysis and has 14 not been developed into a throughput analysis. 15 Finally, this morning the Court asked about the 16 plaintiffs' model, the one that incorporates things such as 17 estimates of oil and gas revenue, timber revenues, and the like. 18 The thing about that model is, Your Honor, it was a revenue 19 model. It simply generated an estimate of revenues in the 20 system. There's nothing in that model having to do with 21 disbursements. 22 And this is indeed the same model like we first 23 encountered in the 2003 hearing, the Phase 1.5 trial. 24 Plaintiffs -- Mr. Fasold basically has a plug formula to get to 25 the $13 billion he estimates oil and gas revenues and the 
Page 95 1 various like, and then, when it's said and done, whatever he 2 can't estimate, there's an "other" category which is defined as 3 the difference between the 13 billion reported in the July 2002 4 report to Congress by the Interior Department, the difference 5 between 13 billion and whatever other estimates he came up with. 6 And when we got to the question of how do you 7 distribute the 13 billion, the answer was, it's not part of this 8 model. And Judge Lamberth noted that as well. 9 So Your Honor, with that, if there are no questions, I 
10 would -11 THE COURT: Go ahead. What? 12 MR. WARSHAWSKY: At this point I was going to leave the 13 podium and Mr. Kirschman was going to address your interest 14 question. 15 THE COURT: Okay. And Mr. Kirschman can talk to me 16 about this 70 percent disbursal rate? Because that's part of 17 the interest calculation, as I understand. 18 MR. WARSHAWSKY: The 70 percent, actually, Your Honor, 19 maybe I can address that. 20 THE COURT: Go ahead. Talk about it. 21 MR. WARSHAWSKY: Are you talking about the disbursal 22 rate in plaintiffs' Attachment A? 23 THE COURT: Well, it was my understanding that 24 plaintiff used that in sort of estimating -- in spreading out 25 the amount of non-disbursements that form the basis of their 
Page 96 
1 interest -- strike interest. Their... 2 MR. WARSHAWSKY: What they've done -3 THE COURT: Whatever we decided to call that number. 4 Not interest, not the time value of money, whatever we decided 5 to call it. 6 MR. WARSHAWSKY: Well, what plaintiffs have done, Your 7 Honor, is they took the data from 1988 to 2002, took their 8 receipts calculation, took their disbursements calculation based 9 upon CP&R data, principally, and averaged it over the period of 
10 '88 to 2002 to come up with this 69.82 percent rate, which they 11 then apply for each year going back to 1887. The assumption is 12 every year 70 percent gets disbursed, and then the rest of it 13 just continues to accumulate. And that accumulated benefit, as 14 they call it, in turn becomes the subject of their interest 15 calculation. 16 So there's always an assumption in their model that 17 you're never going to disburse 100 percent of the receipts. 18 THE COURT: But does the government have some 19 explanation of that 69 point whatever it is, 8-2 percent rate? 20 MR. WARSHAWSKY: Well, the explanation would be, Your 21 Honor, that it's going to vary from year to year, first of all. 22 There are going to be years where you have a much higher 23 percentage than 70 percent; there will be some years where you 24 have a lower percent. And over the history of the trust, Your 25 Honor, there were times that the policy was to encourage 
Page 97 1 retention of cash, other times it was to encourage disbursement. 2 There are a number of individual reasons why that number isn't a 3 flat number. 4 But fundamentally, you also have to start with the 5 notion that the way it's been calculated builds in a number of 6 revenue sources that simply have nothing to do with the 7 IIM Trust, that are things like, as we've talked about earlier 8 today, the Osage headrights, things like IIM Tribal money. 9 So, you know, I think, as I indicated, we are 
10 continuing our analysis of this, but ultimately I don't believe 11 you're ever going to get to a point where everything coming in 12 ends up being posted to an IIM account. We know that's not 13 going to be the case, because there are a number of revenue 14 sources that simply have nothing to do with IIM beneficiaries. 15 But that's how they've used the 70 percent. They've 16 simply calculated an average based on roughly a 15-year period, 17 and then applied it all the way back to 1887. 18 THE COURT: And in that 15-year period, what's the 19 explanation for it, failed bitters, disbursements made but no 20 documentation? I mean, what is it? 21 MR. WARSHAWSKY: Oh, well, again, I think that's an 22 analysis that we're continuing to do. You know, some of the 23 explanation is that -- a big part of the explanation, I would 24 submit, is that included within that calculation are revenues or 25 receipts that simply are never going to go to IIM accounts. 
Page 98 
1 They're not to be posted to the IIM accounts. 
2 But, you know, beyond that, I'm not comfortable giving 
3 you specificity at this time. We certainly will address that in 
4 June. 
5 THE COURT: All right. Who goes first on June 9th? 
6 MR. WARSHAWSKY: Your Honor, as I've indicated, the 
7 plaintiffs have the burden of demonstrating, presenting a 
8 reasonable approximation of the amount that they claim should 
9 be -- that they should receive for restitution or disgorgement. 10 THE COURT: Well, I know. But remember the last time 11 we had this same discussion and there was a perfectly rational 12 argument that the plaintiffs had some burden of proof, but since 13 it seemed to be the government's job to show that they had made 14 an accounting, the government led with their testimony, and the 15 theory was that the plaintiffs would shoot at it and see if they 16 could discredit it. 17 MR. WARSHAWSKY: What the government was attempting to 18 do, Your Honor, in 2007 was to demonstrate that the 2007 plan -19 the Court wanted to conduct a review to determine if the 2007 20 plan was going down the right track, if you will. You know, it 21 made sense, I would submit, to have the government putting on 22 the 2007 plan at the outset. 23 THE COURT: But you're going to have a new version of 24 AR-171 -25 MR. WARSHAWSKY: But -
Page 99 
1 THE COURT: -- by June 9th. 2 MR. WARSHAWSKY: But as I've indicated, Your Honor, I 3 know we're not going to be able to tie down every dollar. 4 Because simply, that's not the way the system works, in that not 5 every dollar collected belongs in an IIM account. We're 6 certainly not going to be in a position, I would say, to tie 7 down dollars all the way back to the inception of the trust, 8 because there was no reason to aggregate that kind of data. 9 But the problem is, Your Honor, that by making the 
10 government go first, the Court in essence presumes that there's 11 been unlawful withholding of money. And the plaintiff has to 12 show that before -13 THE COURT: I tried to make it clear before lunch, and 14 maybe I'm the only person in this room who thinks that there's a 15 distinction, but there's a distinction between unlawful 16 withholding of money, which is the language the plaintiffs keep 17 trying to use, and disbursing money and not being able to 18 account for it. Those are different ideas, it seems to me. 19 And Mr. Gingold tells me I have to presume it as a 20 matter of law, and maybe I do. I'll have to study up on that. 21 But if I'm not so constrained by the cases, it is not logically 22 necessary for me to assume that money you can't account for has 23 been, quote, "unlawfully withheld," closed quote. It's just as 24 logical to assume that the payments were made and you just can't 25 account for them. 
Page 100 1 MR. WARSHAWSKY: Okay. Well, Your Honor, if I may, I 2 was going to have Mr. Kirschman come up and take the interest 3 issue. But since we're really getting into questions about how 4 the trial is going to be presented, Mr. Kirschman is counsel of 5 record, and I would feel -- I do think he would probably feel 6 more comfortable. 7 THE COURT: All right, Mr. Kirschman, your turn. 8 MR. KIRSCHMAN: Good afternoon, Your Honor. Before I 9 address the interest issue and the case you noted from the 
10 9th Circuit, I would like to offer a one-case cite regarding one 11 of the three options you mentioned at the outset of the hearing. 12 You mentioned that there was a possibility that you 13 could issue a declaratory judgment. Defendants would just like 14 to refer the Court, or remind the Court of Christopher Village 15 v. United States. In that case the Federal Circuit held that 16 the 5th Circuit lacked jurisdiction to issue a declaratory 17 judgment as to the government's liability on a contract, even as 18 a predicate for a damages action in the Court of Federal Claims, 19 because the APA did not waive the government's immunity from 20 such a claim. 21 We've cited that at our brief at pages 21 and 22, but I 22 think it's one of two or three we cited and it's just a 23 parenthetical. So we just wanted to highlight that to the 24 Court's attention. 25 THE COURT: All right. Thank you. 
Page 101 
1 MR. KIRSCHMAN: Now turning to the issue of the 2 interest or time value of money. The Court this morning said 3 you were interested in Judge Boggs' decision in United States v. 4 $277,000 U.S. Currency. 5 Plaintiffs cite that for the first and only time on 6 page 73 of their reply brief, in footnote 82. What plaintiffs 7 don't address is the fact that that decision constitutes a 8 minority view, and that the majority of the courts do not 9 follow, or did not follow at the time, that decision of 
10 Judge Boggs. 11 In fact, Your Honor, the majority view is different. 12 And I would like to cite to the Court a case, United States v. 13 $30,006.25. And I apologize, I misplaced the cite right now. 14 I'll have it for you shortly. 15 But in that decision, the 10th Circuit specifically 16 considered Judge Boggs' case and declined to follow it. The 17 Court in the 10th Circuit in this decision - again that was in 18 the year 2000 - stated, "We cannot agree that the 9th and 19 6th circuits have found a legitimate exception to the 20 no-interest rule. Regardless of what they call it, they are 21 allowing an award of interest against the United States without 22 a waiver of sovereign immunity, but, quote, 'the force of the 23 no-interest rule cannot be avoided simply by devising a new name 24 for an old institution,' closed quote." And they're citing the 25 Shaw case there. 
Page 102 
1 "To the extent" -- and I'm quoting again the 2 10th Circuit decision. "To the extent their holdings stem from 3 the fact that the government may be unjustly enriched if it is 4 not forced to disgorge its profits from the seized property, and 5 that a contrary holding is unfair, they do not cite, nor are we 6 aware, of any general waiver of sovereign immunity for unjust 7 enrichment claims." 8 "Moreover," the 10th Circuit explained, "fairness or 9 policy reasons cannot by themselves waive sovereign immunity." 
10 And they again cite Shaw for that proposition, Your Honor. 11 So that, as I stated, is the majority view. This 12 matter -- the issue took on a different stance later in 2000 13 when Congress amended the law related to the civil asset 14 forfeiture provisions. So Congress saw the need to specifically 15 change the law, and the 6th Circuit and the 9th Circuit's 16 positions are to the contrary. 17 Judge Boggs' decision is also distinguishable from this 18 case, Your Honor, in several important aspects. Again, of 19 course, this involved the seizure in a forfeiture action, and 20 that's certainly not what we have here. In those cases you have 21 a strict statutory framework and a seized asset deposit account 22 which was specifically at issue. 23 The case I cited from the 10th Circuit made also 24 perhaps the most important distinction. Both in Judge Boggs' 25 case and in another case cited by Judge Boggs, he had 
Page 103 
1 specifically issued an order shortly after the seizure took 
2 place requiring the government to place the seized funds into an 
3 interest-bearing account, and all parties, including the 
4 government, thought that's what was going to happen. 
5 Through different circumstances, that did not happen in 
6 Judge Boggs' case. And he found that that would be very unfair, 
7 after he had specifically ordered the government to put the 
8 funds in an interest-bearing account, and didn't think - in my 
9 words, not his - that the government should get away with that. 10 That is not the case here, Your Honor. The government 11 in this case has paid interest when it was statutorily required 12 to do so, and we cite in our brief 25 U.S.C., Section 161(a)(b). 13 So there has been interest paid in this case consistent with 14 statute. 15 Also, too, another distinction in Judge Boggs' case is 16 he looked at the long practice in the California district he was 17 in and took judicial notice of the fact that interest had been 18 ordered to be paid in those cases. 19 This case, obviously the Cobell case, is so unique. We 20 have no such long history here that would even suggest interest 21 or the time value of money could be paid, and there should be no 22 exceptions made, consistent with the Shaw case, as cited by the 23 majority view. 24 Your Honor, too, Judge Boggs reviewed the history in 25 seizure cases between the GAO and the Justice Department, and 
Page 104 1 found that that interest was relevant. Obviously, such a 2 history is not relevant here. 3 And the final distinction, and this goes back to the 4 first main one, is that Judge Boggs found that this was simply, 5 in his case, an order to maintain funds shortly after the 6 seizure had occurred and litigation ensued, and he found that he 7 had the inherent power to issue an order related to the 8 maintenance of assets. Here we're not obviously in a position 9 where Your Honor has issued such an order. We're in a much 
10 different case with a very long history. 11 For those reasons, Judge Boggs' decision and the 12 9th Circuit case you mentioned earlier today is of no assistance 13 to plaintiffs. I would say, though, that because this was in 14 the reply brief, and I don't know your exact words, but you said 15 it should be explored in depth, if you would find further 16 briefing helpful, we could brief it on an expedited basis, no 17 more than 10, 15 pages, probably by the end of the week, if you 18 feel this is an issue critical to proceeding. 19 But speaking strictly about that case cited in 20 plaintiffs' reply brief, that is the basis for the distinction, 21 and it was not controlling law at the time, except, of course, 22 in that circuit. 23 THE COURT: Well, I don't want any more briefs on the 24 question. I think what I said had to be explored in depth was 25 the factual basis of the plaintiffs' claim. And I'm not quite 
Page 105 
1 sure what the result of today's proceeding is going to be, but I 
2 suspect it's going to be some form of a pretrial order that will 
3 be issued in a few days that will try to capture what has been 
4 discussed here and express my expectations of what's going to 
5 happen here beginning on June 9th. And then I suppose we'll 
6 have to have another conference to talk about that. 
7 But I don't need any more briefing on Judge Boggs. I 
8 take your point about the split or the non-unanimity of the 
9 Courts of Appeals on this subject. Another case we had found is 10 called Larson vs. United States, which is at 274 F.3d, 643, 11 which also declines to follow Judge Boggs' ruling on that 12 question. 13 MR. KIRSCHMAN: Your Honor, could I give you the cite 14 now for the case that I discussed with you? I didn't have it 15 available when I first raised it. The 10th circuit case. 16 THE COURT: Yeah, what is it? 17 MR. KIRSCHMAN: It's 236 F.3d, 618, 10th Circuit, and 18 that's December 28th, 2000. I'm sorry, I misplaced the cite 19 originally. 20 THE COURT: Okay. 21 MR. KIRSCHMAN: Your Honor, we have not yet addressed 22 lands. Mr. Siemietkowski is available to address the land 23 issues if you feel going forward that could possibly be a part 24 of the trial. 25 THE COURT: The land issues? 
Page 106 1 MR. KIRSCHMAN: Yes. Related to the fair market value 2 claims and the like. Not the claim -3 THE COURT: First of all, let me ask the plaintiffs 4 whether they seriously think the land issue has anything to do 5 with the trial we're going to hear in June. 6 MR. GINGOLD: We weren't sure, Your Honor. And the 7 reason for it is, without an accounting and without the ability 8 to determine the income generated from each interest and the 9 itemization of the trust assets, that's part of the consequence 
10 of not being able to do an accounting. 11 We understand the Court wants to focus on the funds 12 issue itself, but the absence of the accounting as a consequence 13 with respect to identifying the items of the trust -- and Your 14 Honor, what the corpus of the trust is has been an issue in this 15 case from the beginning, because in order to determine the 16 income, you have to know which assets were generating that 17 particular income and then what was invested thereafter. 18 So we thought -- we didn't have a fair market value 19 claims issue, I think is the short form. What we said was, to 20 the extent that there was in evidence that corpus was 21 transferred out of the trust for fair market value, that we 22 wanted the assets restored. 23 We also pointed out that there are reasonableness 24 issues involved, to the extent the Court wants to address it, 25 and those reasonable interests involved reflect the use and 
Page 107 1 occupation by the government, and perhaps third parties that are 2 in trespass. So that is a consequence of not rendering an 3 accounting of all items of the trust, Your Honor. 4 So we understand from what this Court was saying today 5 that the land issues were not going to be part of the trial, so 6 we wouldn't be surprised if that's what the Court decided, for 7 appropriate reasons. 8 But I just wanted to explain, when you don't have an 9 accounting, the plaintiffs are left with unanswered questions in 
10 every respect, including the corpus. And that was supposed to 11 be resolved, as the Court of Appeals identified its 12 understanding of what the scope of the accounting included. 13 So we don't have it, Your Honor, and we believe that 14 was part of the case. We weren't asking for the recovery of 15 whatever the value was in what was sold, we weren't seeking 16 constructive trusts or subrogation rights; we were focusing on 17 as narrow an issue as possible, understanding what we thought 18 this Court was saying and what the consequences naturally are 19 once the accounting is not going to be done. 20 THE COURT: All right. 21 MR. GINGOLD: But Your Honor, I have a point regarding 22 the interest issues. Can I respond to what's been said? 23 THE COURT: Go ahead. 24 MR. GINGOLD: Your Honor, again, as we discussed 25 earlier, plaintiffs aren't looking for the interest that should 
Page 108 1 have been paid to them. Interest that should have been paid and 2 hasn't been credited is damages. We're not looking for that. 3 THE COURT: I got that part. 4 MR. GINGOLD: And Your Honor, what we're looking for is 5 strictly from the restitutionary point of view, the benefit 6 conferred on the government, however that is measured; whether 7 it's measured in the context of the value of funds, time value 8 of funds, or whether it's the cost benefit to the government, or 9 in any other way. And there are many ways it can be done, Your 
10 Honor. 11 And let me point out as a practical matter, the only 12 reason any interest was earned on the beneficiaries' funds is 13 because the commingled funds were invested in U.S. government 14 securities, for the most part. So if you bought a discounted 15 bond, it really -- interest is a euphemism, because you bought a 16 discounted bond for $95 and at maturity it's redeemed at $100. 17 So interest is almost a red herring in that regard. 18 And again, we're dealing with accretion, we're dealing 19 with accruals, we're dealing with imputed income. Assistant 20 Secretary Hammond testified in Trial 1.5 that they did not 21 aggregate interest or income, Treasury didn't, when it was 22 evaluating the return on investment to the trust. All they 23 could do is identify the particular securities that were 24 purchased. And Your Honor, there's no identification of 25 securities, no identification of redemption, no identification 
Page 109 
1 of the reinvestment of those funds. 
2 So interest is really not an issue. That's why the 
3 issue was footnoted in the section that we footnoted it in. 
4 We're not looking for the interest even earned by the 
5 government, whether or not we could, Your Honor. We're not 
6 looking for the interest that was credited, because, Your Honor, 
7 in our calculation we actually backed that out. We are not 
8 looking for interest. If we were looking for anything, we would 
9 have been looking at the yield, and the yield is strictly 10 related to what was actually acquired using our clients' funds. 11 It is nothing else, and there's no other purpose for it. 12 So interest isn't truly relevant. That's the reason 13 again, Your Honor, we moved further back so we wouldn't see any 14 conflation of issues regarding interest and benefit conferred. 15 We thought it was too dangerous with regard to how it could be 16 construed. 17 And that's the reason we followed a line of cases that 18 dealt with how benefit conferred is to be calculated and 19 measured, what is generally considered to be reasonable, and how 20 judges like Pierre LaValle and Posner and Learned Hand and 21 others used that. And we followed that model, Your Honor. If 22 we're wrong, we followed a series of cases that are unrefuted, 23 and from judges that are considered to have sound and honorable 24 reputations in the profession. 25 But it isn't interest, and we're not looking for 
Page 110 1 interest. We're not looking for interest that should have been 2 paid. That is not part of the $58 billion calculation. It's 3 strictly what the government -- how the government benefitted 4 from what it -- from how it used plaintiffs' funds or didn't use 5 them, because those funds were not distributed. And how this 6 Court wants to determine presumptions obviously is a key to all 7 of this. We believe there's a line of cases that very clearly 8 in a trust situation, express trust situation, establish the 9 foundation that plaintiffs used in its calculations. 
10 THE COURT: You talk about encouragement and 11 incentives. You're enticing me into the company of Learned 12 Hand, Pierre LaValle, and Judge Posner. Where in your briefs am 13 I going to find those exalted judges? 14 MR. GINGOLD: They're throughout the reply brief -15 THE COURT: The ones who have an honorable reputation, 16 as distinct from the rest of us? 17 MR. GINGOLD: -- 28, to start, Your Honor. 18 What I was pointing out is there are great judges and 19 there are great judges, and Learned Hand is regarded generally 20 as one of the great judges in this country. 21 THE COURT: Granted. 22 MR. GINGOLD: Whether you're a right-winger or a 23 left-winger, Judge Posner in many respects is considered to be a 24 very, very sound, judicious judge. Judge Alito, he's now 25 Justice Alito -
Page 111 
1 THE COURT: Oh, I forgot, you added Alito, too. 2 MR. GINGOLD: Yes, yes. The 3rd Circuit case, 3 Your Honor. 4 THE COURT: All right. 5 MR. GINGOLD: Thank you, Your Honor. 6 Your Honor, further, in our reply brief we addressed 7 every one of the issues that Mr. Warshawsky discussed earlier. 8 Unless this Court wants us to go into those issues, we will rely 9 on what we state in our reply brief. 
10 THE COURT: All right. 11 MR. GINGOLD: Thank you. 12 THE COURT: This discussion is getting a little -- do 13 you want to be heard? 14 MR. KIRSCHMAN: If I may, Your Honor, on that last 15 point. 16 I raise it both as a legal argument because I think it 17 goes to the question of how the trial should proceed and who 18 goes first. 19 I believe Mr. Gingold, if I understand him correctly, 20 made it clear that plaintiffs are again seeking the benefit 21 conferred upon the government, and it's for that reason that 22 they have relied on a predicate of unlawful withholding, which 23 they haven't presented here. But the mere fact that there 24 wasn't an accounting for the dollars doesn't demonstrate a 25 benefit to the government. 
Page 112 
1 So you had set out the hypothetical, what if the money 
2 was paid but just not accounted for. In that case there would 
3 be no benefit. And because plaintiffs have again reiterated 
4 that their claim going into June 9th is based upon not interest 
5 but benefit to the government, that's a significant flaw in the 
6 argument, because they haven't showed any unlawful withholding. 
7 And your hypothetical wouldn't reach the point where it would be 
8 a benefit to the government if in fact the money was paid out; 
9 it was paid out to a tribe, it was paid out to a disappointed 10 bidder, or it was eventually paid out through a Special Deposit 11 Account to an IIM account holder. 12 And that then begs the question of why plaintiffs in 13 this instance should go first, because we, defendants, need to 14 know clearly what we're responding to once they have presented 15 such a case on the issue of benefit or entitlement to interest. 16 Thank you. 17 MR. GINGOLD: Your Honor, we presented exactly how we 18 intend to proceed, as we thought this Court wanted us to do, in 19 the briefing. We included documents attached to our opening 20 brief which identified what we're going to be using and how we 21 were going to be doing it. The benefit conferred is outlined 22 explicitly on how we're doing it. 23 Your Honor, if our understanding of law is correct with 24 regard to presumptions, not only -- and this Court may view our 25 discussion of the commingled trust issues and the presumptions 
Page 113 1 that are associated with the trustee in a commingled trust 2 vis-a-vis both disbursements from the trust and with regard to 3 deposits into the trust. And under the restatement and related 4 cases, restatement of restitution, it is very clear that the 5 presumptions with regard to expenditures by the trust presumably 6 are not expenditures of the trust beneficiaries' money if the 7 funds are combined with the trustee's. 8 Presumably if they are expenditures of the trust 9 beneficiaries' money - and this is where Learned Hand comes into 
10 play, Your Honor - that it is presumed that if there is a 11 disbursement from the trust and there's an investment in 12 something valuable, then the presumption would be up to the 13 beneficiary to determine if he wants the benefit of that 14 investment. And Learned Hand was quite specific in that regard. 15 In addition, Your Honor, with a commingled trust, the 16 presumption is -- if the funds were expended and they should not 17 have gone to anyone but the beneficiaries, then the presumption 18 is all deposits subsequent to that improper disbursement would 19 be considered to be intended to restore the trust fund itself. 20 And these are identified specifically, they are related 21 to, among other things, Section 54 of the restatement of 22 restitution, and the explanation for those presumptions are 23 stated in our brief, Your Honor. 24 THE COURT: Okay. Thank you. 25 As I said, I think what I better do is to try to sort 
Page 114 1 this out and issue some sort of pretrial order, and I'll try to 2 do it later this week. 3 Oh, another man is on his feet. 4 MR. SIEMIETKOWSKI: I was going to try to convince you, 5 Your Honor, to take the lands issue off the table today. 6 THE COURT: Well, sit down and hear me out. 7 MR. SIEMIETKOWSKI: Yes, sir. 8 THE COURT: You'll like what I'm about to say. 9 It sounds to me, first of all, as if although 
10 technically the government is correct that the plaintiff has the 11 burden of proof on whatever shortfall it claims it needs to 12 recover, the plaintiffs can shift the burden back to the 13 government by filing AR-171 and Exhibit 365, and essentially 14 saying they amount to something like an admission. 15 And then the government is going to come back and say, 16 wait a minute, we've amended AR-171 and here's the amendment; 17 they're going to say, the Osage Indian headrights don't belong 18 here; they're going to say, you've got to net out the people who 19 have died and are not members of the plaintiff class; they're 20 going to say, you've got to net out judgment and per capita 21 accounts, if they're not already netted out. They're going to 22 say whatever else they're going to say about the dollar amount. 23 Then I think on the question of what the benefit to the 24 government has been from the failure to account, I don't see any 25 way that the plaintiff does not bear the burden of proof on that 
Page 115 1 one. And exactly how that works out and exactly what they have 2 to show, I don't know. But I am not willing, absent some more 3 research, which I pledge to do, to assume that the failure to 4 account is the same thing as unlawful withholding. And so I 5 will expect the plaintiffs to assume the burden on that issue. 6 Now, what this means in terms of witnesses, in terms of 7 how long it's going to take to work these issues through at the 8 trial that's to begin on June 9th, I don't have a very clear 9 idea in my head. It could be that we're only talking about a 
10 few days of testimony, and that testimony will be -- and some of 11 it may be filigree on what we already heard about the dollar 12 amounts back the last time, what was it, October of last year? 13 Some of it may be repetitious, some of it may be amendments. I 14 don't expect that I'm going to want to hear a lot of legal 15 argument at that point. 16 Now, I don't think the lands question has anything to 17 do with what we're going to discuss beginning on June 9th, 18 period. This is about dollars into the IIM, dollars in and 19 dollars out. And I'm assuming that if we get out something like 20 a pretrial order later this week and we have more details to 21 discuss, we can schedule another meeting in a couple of weeks to 22 go over what I get out this week. But I'm not scheduling that 23 meeting now. 24 What I would like to do now is to hear briefly from the 25 parties on the subject of reconnecting the Internet of the IT 
Page 116 
1 systems of the Bureau of Indian Affairs. 2 Mr. Warshawsky, you're up. You filed the motion. 3 MR. WARSHAWSKY: Yes, Your Honor. We filed two 4 motions. And as the Court will recall, initially we filed a 5 motion to reconnect the Solicitor's system, and more recently 6 filed a motion to reconnect Bureau of Indian Affairs, the Office 7 of Hearing and Appeals, Office of Special Trustee, to allow the 8 connection of the Office of Historical Trust Accounting, and to 9 vacate the consent order. This has been well briefed, and I 
10 will be brief in oral argument. 11 Your Honor, a lot has changed since entry of the 12 consent order in December 2001. At that time Interior certainly 13 did not have an inventory of all of its systems. The types of 14 security controls that we think of as commonplace today often 15 weren't in existence, things like firewalls, intrusion detection 16 devices, systems. 17 And Interior wasn't alone in that respect. I mean, it 18 was a very different IT security world back then, some seven 19 plus years ago. Or six plus years ago. Is that right? 20 Whatever. Anyway, since December 2001. 21 As we've explained in our briefs, there have been 22 indeed substantial changes in both -- substantial changes of 23 both law and fact since that time. The law changes; 24 principally, Congress' enactment of FISMA, the enhancement of 25 NIST, which has promulgated numerous guidelines, both mandatory 
Page 117 1 and recommendations regarding security controls, which federal 2 agencies now are either required to follow or at least consider. 3 And, of course, the Court of Appeals decision in Cobell XVIII. 4 Factually, all of the systems discussed in our two 5 motions have gone through Interior's connection approval 6 process, the so-called CAP process. Consistent with federal 7 law, the Court has been provided with statements from the 8 authorizing official, designated representative for each bureau 9 or agency involved -- bureau or office involved, I'm sorry, 
10 indicating that after considering information provided by that 11 bureau or office's Chief Information Officer, including 12 assessments of security controls, that the person designated 13 responsible -- I should say the person that Congress designated 14 as being responsible for making risk management decisions has 15 concluded that the security controls and plans in place for the 16 network provide adequate security, commensurate with risks and 17 magnitude of harm potentially resulting from unauthorized 18 access, to protect the information associated with that network. 19 Because of the nature of this litigation, Interior 20 added an additional level of review by the associate deputy 21 secretary, Mr. Cason, not required by federal law, but that has 22 been followed in this case. 23 So the Court is presented with now the kinds of 24 determinations that Congress described in FISMA, and under the 25 guidance of Cobell XVIII, this, of course -- this case, of 
Page 118 
1 course, is not a FISMA compliance case as Cobell XVIII 2 recognized. The Court of Appeals also observed -- assuming such 3 an animal exists. 4 The Court of Appeals noted that in going through the 5 extensive type of federal review involved now in IT security, 6 there was a role for just about everybody, but, with due 7 respect, the federal judiciary. 8 And so we respectfully ask the Court, having now been 9 presented with the types of risk management decisions required 
10 by Congress, and the showing that indeed there is now security 11 in place and security deemed adequate by the responsible 12 officials, the Court should go ahead and allow either 13 reconnection or connection of the OHTA system. 14 THE COURT: Is it your assumption, Mr. Warshawsky, that 15 the consent order is invalid or that it needs to be amended? I 16 mean, the consent order does talk about a Special Master, and 17 there isn't one anymore. 18 MR. WARSHAWSKY: No. Your Honor, at this point -19 THE COURT: Well, then, what do you say to the 20 plaintiffs' argument that you basically are not attempting to 21 abide by the terms of the consent order? 22 MR. WARSHAWSKY: I would say, Your Honor, the consent 23 order has largely been overcome by events. Because of change in 24 both facts and law, it's no longer a meaningful order to begin 25 with. 
Page 119 
1 You know, Your Honor, I actually did work a great deal 
2 with the Special Master back in 2002. As we went through the 
3 process of getting systems reconnected under the consent order, 
4 and into early 2003, it did provide a meaningful process at the 
5 time. That was before a great deal of law had developed. 
6 But simply put, right now the systems are no longer -
7 the systems that existed back then aren't the systems existing 
8 now. And, you know, if we were presented with a similar 
9 situation today, I'm not sure that the consent order -- I'm 10 fairly certain, I would suggest, the consent order would not be 11 an appropriate vehicle. 12 THE COURT: Which is why you've moved to vacate it? 13 MR. WARSHAWSKY: We've moved to vacate it because it 14 doesn't make sense, given the state of where we are now, and 15 frankly it doesn't make sense because there are no systems that 16 should remain disconnected under the consent order. 17 THE COURT: Who wants to give me five minutes from the 18 plaintiffs' side of this? 19 MR. DORRIS: I would, Your Honor. Bill Dorris for the 20 plaintiffs. The consent order is still valid, it's in place. 21 Admittedly the Special Master is no longer involved in the case, 22 but when you look at the function that the Special Master was 23 doing, that function can still be done in this case. 24 Now, where we stand is this: We're starting with a 25 consent order where the government -- which the government 
Page 120 1 drafted and presented to the Court, where the government comes 2 in and says, we acknowledge significant deficiencies in our IT 3 systems. 4 Back in May of last year, Your Honor, you said to them, 5 look, go ahead, get ready to reconnect. When you're ready to 6 reconnect, come in, show me that there's security - and I'm 7 paraphrasing, obviously - and I'm inclined to let you do it. 8 But right now all you're doing is saying that you've got 9 security. 
10 That's where we are now. There's not a single report 11 from an independent qualified contractor that indicates that 12 there's adequate security in these systems, if they're 13 reconnected to the Internet, over the plaintiffs' Individual 14 Indian Trust data. 15 THE COURT: Did I say they had to have an independent 16 qualified contractor? 17 MR. DORRIS: You did not, Your Honor. You said, You're 18 saying that there's adequate security; you need to show that to 19 me. That's my paraphrase for what you said. 20 But I submit to you that they have not shown it to you. 21 The consent order refers to having a qualified independent 22 contractor do a system-by-system analysis. They have not filed 23 those reports with you. What they say is, well, those would 24 contain confidential information. They can be filed under seal, 25 like all the many IT security documents in this case have been 
Page 121 
1 done with the redactions. 2 So where we're standing is they are saying, we say we 3 have adequate security and that ought to be enough. We would 4 submit to you with the evidence that has been presented 5 previously in this case, that there were systemic deficiencies 6 in their security - and we're talking about BIA, is where the 7 wealth of the IITD is - that we need for them, before they 8 reconnect that and put that out on the public Internet, we need 9 to ensure that there is adequate security there. They say there 
10 is; let them show that there is. 11 Your Honor, this is a situation where the Court of 12 Appeals has made clear that where this is a material dispute 13 about something like this, there needs to be both discovery and 14 an evidentiary hearing. 15 THE COURT: Well, that's what Judge Rogers said in that 16 decision, but, you know, in the first place, she didn't read or 17 hasn't read the local rule that says you never hear evidence in 18 preliminary injunction matters in our court. That's a local 19 civil rule of our court. 20 Also, wasn't she talking about if you're going to make 21 credibility decisions the way Judge Lamberth did, if you're 22 going to make credibility determinations, you've got to hear the 23 witnesses? Isn't that what she's saying? 24 MR. DORRIS: Your Honor, I did not read it that way, 25 and I still don't read it that way, that it goes solely to where 
Page 122 
1 there's a credibility determination. It's where there are 
2 disputed material facts, that there needs to be that kind of 
3 hearing. That's the way I read what she said. 
4 THE COURT: If that's the new rule, Court of Appeals 
5 imposed rule for preliminary injunctions in our court, it's 
6 going to stand the practice of this court on its head. Because 
7 for years all district judges have been saying, no, no, no, you 
8 can't bring your witnesses, no, no, no. 
9 MR. DORRIS: Well, Your Honor, we really are in a 10 little bit different procedural spot than that now. We have a 11 consent order that is in place, and they're moving to vacate 12 that consent order. And what they basically have said to this 13 court is, trust us, we've got the security. 14 Now, that's the same thing that they were saying all 15 the way up until 2001, when the Special Master filed a report in 16 November of 2001 that said, hold on a second, they don't have 17 adequate security. 18 So that's the position that the plaintiffs are in at 19 this point right now, is that when they say, trust us, we have 20 trouble trusting them on that. And we would ask the Court to 21 hold them to a higher standard than that, and permit us to at 22 least have them file the reports that they're basing these 23 declarations that they filed with the court so that we can see 24 and question what support they have for the statements they're 25 making. 
Page 123 1 THE COURT: All right. Well, my -- no, I don't need to 2 hear anything more, Mr. Warshawsky. 3 My tentative view of this -- and I'll take this under 4 submission, and it's time for me to rule on this question. It 5 is time for me to rule. My tentative reaction to it is, this is 6 a collateral issue and it's time we took it off the table and 7 let the government reconnect its computers. But I will consider 8 that and rule on it later on. 9 If there's nothing further, counsel, I thank you for 
10 your attention and your helpful arguments today. We have a 
11 criminal matter right behind you, so good-bye. 
12 (Proceedings adjourned at 2:47 p.m.) 
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Page 124 1 CERTIFICATE OF OFFICIAL COURT REPORTER 2 3 I, Rebecca Stonestreet, certify that the foregoing is a 4 correct transcript from the record of proceedings in the 5 above-entitled matter. 6 7 8 9 _______________________________ _________ 10 SIGNATURE OF COURT REPORTER DATE 11 12 13 14 15 16 17 18 19 20 21 22 23 24 25 

Exhibit No.3 

EDDIE JACOBS 
P.O. Box 2322 
Oklahoma City, OK 73101 

(405) 524-4215 
August 30~ 2008 
CERTIFIED MAIL 
Dennis M. Gingold, Esq. 
607 14th Street N.W. 
9th Floor 
Washington, DC 20005 

Keith Harper, Esq. 
Justin Guilder, Esq. 
Kilpatrick Stockton LLP 
607 14th Street, N.W. 
Washington, D.C. 20005 

David Coventry Smith, Esq. 
Kilpatrick Stockton LLP 
1001 West Fourth Street 
Winston-Salem, NC 27101-2400 

Elliott H. Levitas, Esq. 
William E. Dorris, Esq. 
Kilpatrick Stockton LLP 
1100 Peachtree Street 
Suite 2800 
Atlanta, Georgia 30309 

Re: 	Plaintiffs counsel and Defendants failure to represent Johnny Jacobs and Eddie Jacobs IIM and USGS Accounts 
Plaintiffs Attorneys: 
The Court documented how you failed to prove your case and why it made its August 7, 
2008 Decision which favored Defendants evidence. I am dissatisfied with how you failed me and all other IIM beneficiaries and make this formal complaint against the legal representation you provided for all IIM beneficiaries and especially for me in this class action case. 
You had a duty to represent, but failed me and all the other IIM beneficiaries. We have a worse outcome because of your negligent representation. If IIM beneficiaries read the 
pleadings and the courts August 7, 2008 Memorandum they will discover just how. 
flawed your representation has been and why the judge made his ruling. 
Eddie lacobs letter to plaintiffs counsel 08-30-08, page 1 of- !.4 
I understand why an accounting may be impossible for all IIM beneficiaries due to. costs 
and/or lost and destroyed records, but an accounting is not impossible for me. You asked foran accounting for all beneficiaries and I asked for an accounting for one person, Eddie Jacobs. Your continued misrepresentation is a substantial factor in the loss of my being able to recover my fathers and my property. 
The court cited plaintiffs counsels multiple flaws, errors, mistakes, uncorroborated evidence, failure to produce credible expert witnesses, failure to produce a witness with personal knowledge who could dispute the governments testimony, failure to produce a single witness who could testify in detail about moderu borrowing practices at Treasury, ignoring or refusing to evaluate evidence, overlooking transactions, ignoring or refusing to accept the replacement of figures with updated numbers provided to them by the government, failure to refute Ms. Hermans testimony and figures, failure to produce any 
evidence of stealing of assets from within the trust system in the last 120 years, made baseless, self-serving modifications to the historical data, failure to take time or 
opportunity to review Scheurens methodology or data when the court offered, and 
failure to prove any bias in the governments model.~ 
Plaintiffs conceded much when they did not have to such as the conceding the government lacked reliable records back toi 887. Plaintiffs counsel could have found reliable records but failed to seek them. You had my records in your hands, but chose not to pr.esent Eddie Jacobs records dating back to 1912. You had. a duty to. present Eddie 
Jacobs records to the court to help substantiate your case but you did not. 
You failed me and all IIM beneficiaries, who have records to show what the government has taken from us. You failed to present any records or American Indian witnesses. I requested more than once to testify to avail plaintiffs of my specific knowledge of the 
Five Civilized Tribes of Oklahoma and oil and gas issues, which could have benefited 
plaintiffs, but plaintiffs counsel chose not to hear my testimony or use my records as 
evidence to help other plaintiffs. 

PLAINTIFFS COUNSEL FAILED TO PRODUCE EVIDENCE OF 
MALFEASANCE OR WRONGS 

"Whatever problems have existed in the history of this 

trust, and however serious the misfeasances and 

malfeasances of the trustees over 120 years, there has 

never beenany evidence of such prodigious pilfering of 

assets from within the trust system itself." P. 16 

I ask why you failed to produce Johnny Jacobs and Eddie Jacobs~ historical documents 
dating back to 1912, which you and defendants have discussed for a number of years, 
documents that I have asked you to.produce numerous times, but you did not: You said 
you represented me in this case, but you did not address the contents of my documents, 
which would have shown serious malfeasances of the trustees during the past 120 years. 
Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 2 of 14 
The government took money from Johnny Jacobs Individual Indian Money account 
when he was a minor arid purchased Liberty Bonds and War Savings Stamps. This 
money was never repaid to his IIM account and there is compound interest due on the full 
amount. .. 
The BIA failed to terminate oil and gas leases which should have terminated on their own terms, but which they failed to terminate. Beneficiaries cannot tel~inatethese restricted oil and gas leases, which must be terminated by the BIA. These are malfeasances, which you never addressed. You had evidence in my records, which you had a duty to produce, but failed to do so. 
The BIA lost an IIM account and all the funds contained it never to be repaid, but you did not show this malfeasance. I am sure if you had interviewed IIM beneficiaries you would have found many more malfeasances for the court to examine, but you failed all American Indian beneficiaries because you refused to view American Indians as individuals. You chose to treat us a class without individual losses. 
"Second, plaintiffs presented no evidence that their. 

theoretical benefit to the government was anything other 

than a theory." P. 41 

"Plaintiffs adduced no evidence that the Treasury ever 

decided to make an actual investment mf IIM funds to the 
.governments own benefit and produced no evidence of any 

decision not to borrow money on account of IIM funds." P. 

42 

EDDIE JACOBS CASE IS UNIQUE AND REQUIRES 
IMMEDIATE SETTLEMENT 
The Cobell court in its Memorandum Opinion dated December 19, 2005, p. 7 stated, "It 
is to be noted that other than Mr. Jacobs, no trust beneficiary among the 500,000 or more 
in the plaintiff class has objected or commented to the interim fee petition by telephone 
or e-mail." Now, I object to plaintiffs counsels inadequate representation of all IIM 
beneficiaries. 
The court recognizes that my situation is unique and on March 5, 2008 asked Mr. Gingold, "What do I do with Eddie Jacobs? What are you going to do with Eddie Jacobs? He wants to opt out.1 Mr. Gingold answered, "Nr. Jacobs, as ~ read his 
complaint, Mr. Jacobs is talking for the most part about 

damages. Mr. Jacobs believes he has an action for damages." 

Mr. Gingold does not know what I believe. When I went to the United States solicitor I 
asked for an accounting/reconciliation of my fathers and my account, not damages. I 
presented my fathers and my documents for this purpose. 
1 Transcript of Status Conference, March 5, 2008, p. 29, 11. 10-11
Eddie Jacobs letter ~to plaintiffs counsel 08-30-08, page 3 of 14 
My case has always been unique and warrants special.recognition and immediate 
settlement because of the documents, which I have presented to defendants pursuant to the 1994 Trust Reform Act, which both plaintiffs and defendants have examined but have failed to present to the court. 
My records if produced to the court would have shown that the government benefited from my fathers IIM funds for the benefit of the war efforts during World War I and World War II. There was also evidence that showed how the govermnent used funds from IIM accounts for old age pension funds. You chose not to produce any of this evidence to my detriment and.to all American Indians detriment. 
My father, Johnny Jacobs and my IIM account is unfractionated and may be settled by defendants without my having to pursue a claim in the Federal Court of Claims, which I understand can take many more years. I should not have to wait. I have been waiting for more than 20 years. 
Defendants say they can do my accounting/reconciliation and reimbursement of principal, past and accruing interest at the highest legal rate based on Johnny Jacobs and Eddie Jacobs IIM and USGS documents dating back to 1912 beginning on page one. There is money in special deposit accounts for reimbursement to beneficiaries and now there is money to be distributed to individuals in this case. 
Ross Swimmer and Donna Erwin from the Office of Special Trustee told me they would conduct an accounting/reconciliation to my IIM account. They said they had all my records and would perform it if Plaintiffs counsel would release me from this case. I 
asked Plaintiffs to release me more than once but never received a response to my written 
requests. 
Therefore, I request the Court to recommend or oi:der a remedy for my unique position in this case since Plaintiffs counsel failed to respond to any of my requests. It should be noted that whenever I asked for a desk review for late posting due to Johnny Jacobs IIM 
account, tank bottom payments, .and windfall profits tax refunds the BIA proceeded to an 
audit and paid for these particular items. I was able to get this muchdone single-handed 
andyet plaintiffs Counsel failed to prove that the government benefited from any IIM 
accounts. 
"That the government lacks reliable records back to 1887 is 

hardly surprising, as even the plaintiffs own witness 

conceded. Tr. 331:19-332:8 (Cornell). But for the 1994 Act, 
indeed, an accounting claim raised 121 years into the trust 
would ordinarily be prejudicially late. See, e.g., BOGERT ET 
AL. N 962 "Beneficiaries who know of the method employed by 

a trustee in keeping accounts and do not object over a 

period of years will notbe heard.to object later."). The 

passage of the 1994 Act renewed plaintiffs entitlement to 

an accounting, but it did not necessarily create an 

entitlement to the super-strong adverse inference asserted 

Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 4 Of 14 ~ 
here. In importing certain doctrines from background trust 
law and excluding others, the Court must seek fairness to 
both parties. See, e.g., Providence Rubber Co. v. Goodyear, 
76 U.S. 788, 807 (1870) (a court should "exercise its 
flexible jurisdiction in equity as to protect all rights 
and do justice to all concerned.")." P. 65 

I presented my records pursuant to the 1994 Trust Reform Act and received no relief. 
My records are the smoking gun that neither defendants nor plaintiffs want to 
acknowledgel I, one in 500,000 lodge this additional complaint against plaintiffs 
attorneys and state for the record, you failed me and I hold you responsible for inadequate 
representation of my individual case. Therefore, I plead with the court to recommend and 
order a remedy for my one in 500,000 case. 

The courts August 7, 2008 Memorandum stated why it made its ruling and showed how 
plaintiffs attorneys failed me and all American Indian beneficiaries in all the different 
ways as follows. 

PLAINTIFFS COUNSELS FLAWS 
"Plaintiffs model suffers from numerous methodological 

flaws that were illuminated by the governments 
presentation and, in many instances, are obvious to anyone 
having basic familiarity with the case." P. 15-16 

"The most obvious flaw, perhaps, is that thesize of 

plaintiffs calculated shortfall -- $4 billion, out of 
total receipts of about $14 billion, see PX-189-A at Column 
B -- is uncorroborated by any other event or data." P.. 16 

"Methodologically, the two most important flaws in 
plaintiffs model are: (I) that the model includes as 

collections certain sums that, by defin2tion, will not be 

reflected as disbursements in the C.P&R data, including 
Osage headright payments; and (2) that the model accepts 

historical receipt data and disregards historical 

disbursement data from the same documents and systems, or 
makes self-serving adjustments to one side of the ledger 

and not the other. These flaws will be discussed in turn." 

P. 17 

PLAINTIFFS COUNSELS MISTAKES 
"This basic mistake in plaintiffs theory -- ignoring or 

overlooking fund transfers -- had the effect of driving up 

the amount allegedly "withheld" and driving down the 

disbursement rate upon which plaintiffs relied for their 

Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 5 of 14 
calculations of ~withholding" for all the years before 
1988." P. 18 

The court goes on to say, ~Osage headright disbursements 
are not to be found in CP&R disbursement data, and both of 
plaintiffs experts agreed that Osage mineral estate 
revenues did not belong in IIM system receipt data." ~The 
effect of this mistake, once again, is both to add over 
$800 million in erroneous receipts and to drive down 
plaintiffs calculated disbursement rate, see Tr. 1596:6-17 

(Palmer), causing the inaccuracy to metastasize." P. 21 

PLAINTIFFS COUNSELS SINGLE-MINDED RELIANCE ON CP&R DATA 
"Transfers from the IIM system are not the only 
transactions overlooked by plaintiffs single-minded 

reliance on CP&R data." P. 18 

~The error Of plaintiffs total reliance on CP&R data as 
representative of disbursements is especially palpable when 
one Considers the incl~sion in their model of Osage 
headright monies as trust receipts. Osage headrights are 
the product of the Osage Allotment Act of 1906, Pub. L. No. 
59-321, 34 Stat. 539, which allotted Osage tribal lands to 
individual members, see id. At ~ 2, 34 Stat. 540, but 
preserved the mineral estate of those lands for common 
management under the direction Of the tribe." P. 20 

~From the beginning of the June 2008 trial, the 
government had the burden of explaining the gap between 
receipts and postings revealed by its exhibits from the 
October 2007 trial. Plaintiffs added nothing to that burden 
by their trial presentation. Their model did not make use 
of the best available evidence and did not make fair or 
reasonable comparisons of data. Plaintiffs injected bias in 
their model through use of unfounded adjustments. By 
deeming all receipts admitted and seeking to put the 
government to the strictest of proof on all disbursements, 
plaintiffs model not only attempted via the ~back door" to 
impose a ~gold plated" accounting standard the Court of 
Appeals had already rejected, but it employed.a superstrong interpretation of the presumption against the 
breaching trustee that cannot be equitably applied to the 
trusts at issue here. The plaintiffs model stands or falls 
with their legal theory, and it falls." P. 68 

Eddie Jacobs letter to plaintiffs couns~ 08-30-08, page 6 of 14 
PLAINTIFFS COUNSEL FAILED 
TO REFUTE DEFENDANTS FIGURES 

"Plaintiffs are skeptical about a reduction in revenue for 
the years 1986-1997 of "roughly $243 million" between the 
AR-171 .exhibit in the October trial and the revised DX-371 
exhibit produced at these proceedings, see Tr. 628:8-17 

(Herman); PX-II9, but they have in no way refuted Ms. 
Hermans testimony, and I find it to be credible." P. 19 

"Plaintiffs continue to draw their receipts data from 

government figures produced during the October trial, see 
PX-189-A n.l; AR-171, ignoring or refusing to accept the 
replacement of those figures with updated numbers, see DX371, that have eliminated phantom receipts. They refuse to 

accept Ms. Hermans reductions in receipt data because she 
did not "show her work." P. 19 

"Plaintiffs demonstrated willingness to accept data 
they liked and reject da~a they disliked did not enhance 
the credibility of their model. Their initial model would 
accept government receipt data from a historical document, 
but reject disbursement data from the same document in 
favor of.their calculated disbursement rate. See Tr. 
291:18-292:23 (Cornell)." Their rebuttal model continued to 
make self-serving modifications to the historical data, 
some driven by their calculated disbursement rate, see PX189-A at n.l, and some even more baseless." P. 21-22 

PLAINTIFFS COUNSEL FAILED TO PRODUCE RELIABLE WITNESSES 
"Nonetheless, the plaintiffs model increases the 
receipts -- and onl.y the receipts -- by dividing themby 77 
percent, the figure that represented the-gap between 
receipts and postings in DX-365. Tr. 1581:7-13 (Palmer). 
This ~exhibit from the October 2007 trial was prepared to 
discuss what percentage of dollars would be covered by the 
governments accounting procedures, and had nothing to do 
with the percentage of funds that might have been collected 
and not paid into the Treasury, a detail about which the 
plaintiffs witness .(a last-minute surrogate) was evidently 
unprepared to testify. P. 23-24 

"Instead of providing unbiased opinions, plaintiffs expert 
witnesses essentially provided plaintiffs with a way to put 
a dollar value on their argument that all datathat favors 
the plaintiffs may be treated as admitted, and all data 

Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 7 of 14 ~ 
that disfavors them must be proven by the government with 
discrete, transactional evidence." P. 24 

"Plaintiffs theory assumes that any cash in the 
governments hands benefits the government regardless of 
where it is held, but a government witness with knowledge 
of Treasury borrowing practices tes.tified tha~ cash and 

investments held outside the Treasury General Account are 
not considered in Treasury borrowing decisions, Tr. 
1245:21-1246:13 (Grippo); plaintiffs believed 
otherwise, but they did not produce a witness with personal 
knowledge who could dispute this testimony." P. 41 

"Plaintiffs only witness with knowledge of the borrowing 
practices of~Treasury was Dr. James C. Miller, former 
director of the Office of Management and Budget. All he 
could say of plaintiffs theory regarding saved borrowing 

costs was that it was sound as a matter of economics and 
common sense; he said so on the basis of no personal 

knowledge of the day-to-day mechanics of borrowing 
decisions at Treasury. Tr. 253:21-254:2 (Miller)." P. 41 

"But even plaintiffs expert agreed that it is only.the 
specific nature of~he relief sought here that secures the 
jurisdiction of this Court to order monetary relief against 
the government. See Tr. 77:4-21 (Laycock); Blue~Fox, 525 

U.S. at 262." P. 48 

"Plaintiffs did not produce a single witness who could 

testify in detail about modern borrowing practices .at 

Treasury." P. 52 

PLAINTIFFS COUNSEL FAILED TO REVIEW DATA 
~There can be no complaint that plaintiffs lacked time or 
opportunity t~o review Scheurens methodology or data. The 
parties were given a standing offer to adjourn the trial in 
the event that they were confronted with information that 
they were not immediately able to address. See Hrg. Tr. 
83:1-7 (Apr. 28, 2008) (the Court); Tr. Pretrial Conference 
13:8-17 (June 2, 2008) (the Court)~ The offer was not taken 
up." p. 36, footnote 13. 

PLAINTIFFS COUNSEL FAILED TO PROVE BIAS 
~But whatever criticisms plaintiffs had about the 

Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 8 of 14 
-governments model, they were not able to prove any bias 
that would render it fundamentally unsound." P. 38 

"First, as explained earlier in this memorandum, 

plaintiffs model contains plain inaccuracies, and the 

compound interest factor only compounds them." P. 40 

"Second, p!aintiffs presented no evidsnce that their 

theoretical benefit to the government was anything other 

than a theory." P. 41 

PLAINTIFFS COUNSEL FAILED TO CONTRADICT 
DEFENDANTS OFFER OF PROOF 

"("All evidence is to be weighed according to the proof 

which it was in the power of one side to have produced, and 

in the power of the other side to have contradicted."). 

Yet there are at least three reasons not to accept 

plaintiffs super-strong assertion of the presumption in 

this case. First, and foremost, to do so would breathe new 

life~ into a ."gold-plated" form of accounting that the Court 

of Appeals has already rejected as unduly burdensome, and 

that plaintiffs themselves have disclaimed. See Tr. of 

Appellate Oral Argument 40:1-45:25 (Sept. 16, 2005), [Dkt. 

3519, ExhLbit i]." P. 63-64 

The Court did not find that Plaintiffs were able to contradict defendants offer of proof. 
Once again you failed all American Indian beneficiaries. 

REMEDIES 
"Restitution and disgorgement are not remedies for the 

failure to account, but for the failure to pay. 

The only relevance to plaintiffs restitution claim of my 

impossibility finding is that it raises an evidentiary 

presumption in favor of the beneficiaries and against the 

trustee." P 46-47 

"Thus, while equity will influence questions of.proof and 
calculations regarding funds withheld, it does not allow me 
to award any relief -- whether legal or equitable -- other 
than the specific return of funds withheld in breach of 
trust, because, in this Court, the government has not 
waived its immunity to anything other than specific 
relief." P. 51 

"The foregoing discussion.telegraphs the answer to the 

EddieJacobsle~ertopla~i~co~sel08-30-08, p~e9of.l~ 
next question, which is whether I have jurisdiction in 
equity to order disgorgement of the "benefit to the 
government" plaintiffs think was derived from the 
withholding of trust funds. The answer is simply "No" -but the plaintiffs have devoted Such. a significant amount 
of attention to the claim that a full explanation for its 
rejection will be attempted here. I have c.oncluded after 
hearing the evdence that the claim must be denied (I) 
because there is no proof that the government was 
actually relieved from the need to borrow money because of 
IIM funds it had not posted to accounts; (2) be~cause a 
claim for theoretical savings of borrowing costs is in 
substance a claim for damages; and (.3) because, in general, 
an accounting for profits is not specific relief within the 
meaning of Bowen and Blue Fox. P. 51-52 

"The financial practices of the Treasury Department in the 
early years of the trust -- a very important era because, 
in plaintiffs submission, early differences compound over 
the life of the trust -- remain a complete mystery. Even if 
the record contained information about Treasurys use of 
identified trust funds now or in the past, such information 
would not prove anything about the use or management of 
misidentfied or mislaid funds. Plaintiffs assumption that 
all funds went into the Treasury General Account and were 
all taken into account when the government made borrowing 
decisions is thus, only an assumption, entirely unproven as 
to any specific funds, and specifically refuted as to the 
modern borrowing practices at Treasury." P. 52 

"If profits from the use of the property are sought, the 

plaintiff has the burden of proof to establish the gross 

amount of such profits." See Joel Eichengrun, Remedying the 

Remedy of Accounting, 60 IND. L.J. 463, 469-70 (1985) 

(citing Pallma v. Fox, 182 F.2d 895 (2d Cir. 1950) (Hand, 

C.J.)). Plaintiffs essentially concede as much, see 

Plaintiffs PropoSed Findings of Fact and Conclusions of 

Law, [Dkt. 3549] at 140 (plaintiffs have burden of proving 

a reasonable approximation); id. at 141 (citing above 

article), but they did not sustain their burden." P. 52-53 

~Plaintiffs read  702 and Bowen far too broadly in 

arguing that any remedy classifiable as restitution or 

disgorgement is relief "other than. money damages." The 

Supreme Court has already made clear that, where money is 

at stake, it must be "the very thing to which [the 

plaintiff] was entitled" to come within the waiver, see 

Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 10 of 14 
Bowen, 487 U.S. at 895 -- or the suit must be brought "to 
enforce the.statutory mandate itself, which happens to be 
one for the payment of money." Blue Fox, 525 U.S. at 262 

(citing Bowen, 487 U.S. at 900)." P. 55 

"I have rejected the plaintiffs claim of entitlement to an 
additional sum representing "benefit to the government."" 

P. 5 

I read where your lead plaintiff found the Courts August 7, 2008 decision "disappointing and difficult to understand." Naturally, she and all Individual Indian Money (IIM) Account beneficiaries are disappointed .with the $455 million amount cited by the Court. 
If American Indians believe all the governments past injustices can be addressed in a class action lawsuit, expectations will never be met. The court must look only at the evidence presented and the laws, which govern the court, 
IIM beneficiaries are looking for forgiveness for past sins and wrongs for 120 years, which continue daily. Can any court right these va-ongs? Not without reliable witnesses and proof of its theories. 
Can any amount of money right these wrongs? Certainly $47 billion would have made Plaintiffs counsel happier than the $455 million cited by the court. Should IIM claims have been filed in the Federal Court of Claims in the first place? Should there ever have been a class for individuals who are owed individual money damages? Do individual Indians have access to equal justice attorneys? 

EDDIE JACOBS SATISFIED REQUIREMENTS OF THE AMERICAN INDIAN TRUST FUND MANAGEMENT REFORM 
The court stated how plaintiffs counsel failed IIM beneficiaries in your representation in 
this important case. You. failed me because I have been denied the constitutional right to 
my property and procedural due process of law, which requires that proceedings shall be 
fair. I plead with plaintiffs counsel, defendants, and the Court to do what is fair and 
right in hearing my case and reimbursing my fathers and my property, including 
compound interest, due to my father and me and repeat the ways my case is unique. 
(1)
 Eddie Jacobs began an administrative claim for relief long before there was a 
Cobell class. 

(2)
 Eddie Jacobs claim is an unfractionated claim passing from one original allottee, Johnny Jacobs estate to one heir, Eddie Jacobs. 

(3) 	
Historically, Johnny Jacobs, a minor, had two IIM accounts with separate 80-acre mineral tracts with two different leases, one for each revenue source. 

(4)
 Eddie Jacobs records show the State of Oklahoma levies an Oklahoma Gross 

Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 11 of 14 	.. 
Production Tax and Fees, which separates the Cobell class plaintiffs from all Oklahoma Indian mineral owners similarly affected by the gross production taxes and fees taken from IIM accounts. 
(5)
 February 24, 2005, Defendants counsel stated Eddie Jacobs is a "non-party.2 

(6) 
Eddie Jacobs case is unique because of the completeness of my fathers and my IIM and USGS historical records. 

(7) 	
The Court recognized that I was unique when I objected to Plaintiffs attorneys fees, "It is to be noted that other than Mr. Jacobs, no trust beneficiary among the 500,000 or more in the plaintiff class has objected or commented to the interim fee petition by telephone or e-mail.3 

(8) 
Defendants officials, Ross Swimmer and Donna Erwin, Office of Special Trustee, told me directly they would reconcile my fathers and my accounts if Cobell plaintiffs counsel would release me from the class. 

(9) 	
Department of Justices counsel asked in a letter to Plaintiffs counsel, "Should out- understanding of the scope of the class certification be incorrect or should you elect to allow us to communicate directly with Mr. Jacobs, please let us kn0w.4 

Apparently the Justice Department had doubts that I should be a class member. I understand Mr. Swimmer and Ms. Erwins statements mean DOI trustees will reconcile and repay to Eddie Jacobs all funds due and owing to my fathers and my IIM and USGS accounts beginning in 1912, including principal and interest at the highest legal rate, payment for lost IIM accounts, war bonds, and other lost amounts for claims which can .be proved in an unbiased review of our records as set out in the 1994 Trust Reform Act. 
The 1994 Indian Trust Reform Act guarantees, "The Special Trustee shall.monitor the reconciliation of tribal and Individual Indian Money trust accounts to ensure that the Bureau provides the account holders, with a fair and accurate accounting of all trust accounts.5 
The American Indian Trust Fund Management Reform provides authority for payment of claims for interest owed: "The Secretary shall make payments to an individual Indian in full satisfaction of any claim of such individual for interest on amounts deposited or invested on behalf of such individual before October 25, 1994, retroactive to the date that the Secretary began investing individual Indian monies on a regular basis, to the extent that the claim is identified - (1) by a reconciiiation process of individual Indian 
2 Defendants Opposition to Non-Party Eddie Jacobs Motion for Leave to File Under 
Seal Eddie Jacobs Individual Indian Money Account Documents, February 24, 2005
3 Memorandum Opinion, dated December 19, 2005, p. 7 4 Letter from Lewis S. Wiener to Robert M. Peregoy, dated July 10, 1998 5 25 USC, Title 25, Chapter 42, Sec. 4043, (2) (A) 
Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 12 of 14 ~ 
money accounts, or (2) by the individual and presented to the Secretary with supporting documentation, and is verified by the Secretary pursuant to the Departments policy for addressing accountholder losses.6 (emphasis added). 
Plaintiffs counsels failure to produce evidence of Liberty Bond and other type loans to the government and governments use of IIM beneficiaries funds for old age pension payments constitutes a breach of their duty to me and to all IIM beneficiaries. Plaintiffs counsels failure to produce one IIM beneficiary was negligent and disrespectful to all American Indians. 
My documents demonstrated evidence of benefit to the government for use of IIM bond investment money and money used to pay old age pension funds, but plaintiffs counsel chose to ignore these documents. They also chose not to produce any IIM witnesses who could have told their experiences of how they were harmed and how they were unfairly and unjustly mistreated during the past 120 years, but you chose to ignore our people. 
You failed to show the United States Treasury guaranteed Liberty bonds and Owes my father and IIM beneficiaries principal, plus compound interest due on these bonds. Secretary of the Treasury Hammond said, "Treasury is responsible for keeping track of each Treasury security issued by the government. See, e.g., (Pltffs Ex_h. 2) (testimony of Don Hammond, Assistant Secretary of the Treasury, Financial Management Service at that time and current Member of the Board of Governors of the Federal Reserve System) 
at Tr, 57:12,22, May 13, 2003 AM ("Hammond Trial 1.5 Testimony") (Our 
responsibility is to keep track of specific Treasury securities issued, the rate of interest 
they pay, and the payment .of those interests credited.")] Mr. Hammonds statement 
confirms my argument for interest on all the war bond loans and other investments. 
Individual American Indians deserved better legal representation from its counsel. Individual American Indians did not have adequate legal representation. The court said plaintiffslegaltheoriesfall.!rhe plaintiffs model stands or falls with their legal theory, and it falls." P. 68. Plaintiffs legal representation of all IIM beneficiaries fell and failed. 
6 25 USC, Title 25, Chapter 42, Sec. 4012 7 Plaintiffs Memorandum In Support Of Equitable Restitution And Disgorgement, March 19, 2008, p. 9 
Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 13 of 14 
I stand by all I have stated to you now and in the past. My records will bear out the truth of my statements to you and I ask this Court to grant me relief as requested. 
Sincerely, 
Eddie Jacobs 
The Hon. James Robertson, United States District Judge, USDC, D.C. Jeffrey S. Bucholtz, United States Acting Assistant Attorney General Michael F. Hertz, United States Deputy Assistant Attorney General 
J. Christopher Kohn, United States Department of Justice, Director, Civil Division John Stemplewicz, Senior Trial Attorney, Commercial Litigation, Civil Division Robert E. Kirschman, Jr., United States Department of Justice, Civil Division John Warshawsky, United States Department of Justice, Civil Division Ross Swimmer, Special Trustee, Office of.Special Trustee, DOI Donna Erwin, Principal Deputy Trustee, Office of Special Trustee, DOI John Echohawk, Esq., Native American Rights Fund Hon. Byron L. Dorgan, Chairman, Senate Committee on Indian Affairs Hon. Lisa Murkowski, Vice Chairman, Senate Committee on Indian Affairs Hon. Tom Cobum, Oklahoma, Senate Committee on Indian Affairs Hon. John McCain, Senate Committee on Indian Affairs Hon. Nick J. Rahall, II, Chairman, Committee on Natural Resources Hon. Don Young, Ranking Republican Member, Committee on Natural Resources Honl Dan Boren, Oklahoma, Committee on Natural Resources 
Eddie Jacobs letter to plaintiffs counsel 08-30-08, page 14 of 14