Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-caDC-99-05222/USCOURTS-caDC-99-05222-0/pdf.json

Nature of Suit Code: 440
Nature of Suit: Other Civil Rights
Cause of Action: 

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United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 28, 2000 Decided March 31, 2000

No. 99-5222

Timothy C. Pigford, et al.,

Appellees

Leonard C. Cooper,

Appellant

v.

Dan Glickman, Secretary,

The United States Department of Agriculture,

Appellee

---------

Consolidated with

No. 99-5223

Appeals from the United States District Court

for the District of Columbia

(No. 97cv01978)

(No. 98cv01693)

---------

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David M. Schnorrenberg argued the cause for appellant.

With him on the briefs were Richard T. Seymour, Teresa A.

Ferrante, Stephon J. Bowens, Marcus Jimison, J. Michael

Klise and Matthew C. Hans. Julie Nepveu and Julie L. Gantz

entered appearances.

Alexander J. Pires, Jr. argued the cause for appellees

Freddie Jones, et al. With him on the brief was Phillip L.

Fraas.

Robert M. Loeb, Attorney, U.S. Department of Justice,

argued the cause for appellee Dan Glickman, Secretary, The

United States Department of Agriculture. With him on the

brief were David W. Ogden, Acting Assistant Attorney General, Marleigh Dover, Special Counsel, and Wilma A. Lewis,

U.S. Attorney.

Before: Sentelle, Rogers and Tatel, Circuit Judges.

Opinion for the Court filed by Circuit Judge Rogers.

Rogers, Circuit Judge: Leonard C. Cooper appeals the

district court's order approving a consent decree settling

lawsuits brought by a class of approximately 20,000 AfricanAmerican farmers, of which Mr. Cooper is a member, against

the United States Department of Agriculture ("USDA").1

See Pigford v. Glickman, 185 F.R.D. 82 (D.D.C. 1999). Under the decree, the United States is likely to provide an

estimated $2 billion in debt relief and monetary payments in

consideration for the dismissal of the class' complaint alleging

that USDA systematically discriminated against them on the

basis of their race. See id. at 111. Making no claim that the

farmers' individual claims cannot be fairly and justly resolved

under the decree, Mr. Cooper contends instead that the

benefits of the consent decree are illusory because USDA has

__________

1 Mr. Cooper is the only member of the class to appeal although

in noting his appeal he purported to file on behalf of himself

individually and as a representative of a class of African-American

farmers, sending copies to nine named persons. None of those

persons is a named appellant, however. The class representatives,

the named plaintiffs in the district court, and the Secretary of

Agriculture are appellees.

reserved the right in paragraphs 19 and 21 to undo the

decree by regulatory fiat, depriving the farmers of any judicial relief and, thus, the district court abused its discretion in

approving the decree as fair, adequate, and reasonable under

Rule 23(e) of the Federal Rules of Civil Procedure. As

clarified by stipulations in the briefing and oral argument on

appeal, no basis exists to conclude that USDA would promulgate such a regulation under laws in effect when the decree

was approved by the district court. While paragraph 19

leaves the class exposed to potential congressional enactments nullifying or modifying the consent decree, the class

would bear that risk in any event, at least so long as the

decree remains executory. Additionally, Mr. Cooper's contention concerning the limitation of the district court's authority by paragraph 21 is inconsistent with the plain language of

that provision. Accordingly, because Mr. Cooper's contenUSCA Case #99-5222 Document #507552 Filed: 03/31/2000 Page 2 of 14
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tions are unpersuasive on their own terms, and, in light of the

benefits conferred on the class by the decree taken as a

whole, we find no abuse of discretion by the district court,

and we affirm.

I.

The consent decree settling the class action was the product of lengthy and, at times, contentious negotiations. The

background is set forth in Judge Friedman's comprehensive

opinion, Pigford, 185 F.R.D. at 89-92, familiarity with which

is assumed, and we repeat only the details necessary for this

opinion.2

USDA indirectly administers programs that provide credit

and other benefits to farmers. The USDA's credit and

benefit programs are federally funded, but the decisions to

approve or deny applications for credit or benefits are made

at the county level by a committee of three to five members

elected by local farmers and ranchers. In addition to acting

on credit and benefit applications, the county committee

appoints a county executive to assist farmers in completing

__________

2 The district court's opinion appears as an appendix to this

opinion.

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their applications and to recommend to the county committee

which applications should be approved. Id. at 86. USDA has

promulgated a number of regulations governing how these

officials are to administer the credit and benefit programs,

but the evidence before the district court shows that USDA

has exercised little oversight regarding how applications historically have been processed at the county level. Id. at 86-

88. For years, African-American farmers, who have been

significantly underrepresented on the county committees, see

id. at 87, have complained that county officials have exercised

their power in a racially discriminatory manner, resulting in

delayed processing or denial of applications for credit and

benefits by African-American farmers not experienced by

white farmers who are similarly situated. Id. at 87-88. Such

discriminatory treatment is prohibited by statute and by

regulation. See 15 U.S.C. s 1691(a) (1994); 7 C.F.R.

ss 15.51, 15.52 (1999). In December 1996, the Secretary of

Agriculture appointed a Civil Rights Action Team to investigate allegations of racial discrimination in the administration

of USDA credit and benefit programs, and, in February 1997,

the USDA Inspector General reported that USDA had a

backlog of discrimination complaints in need of immediate

attention. The President and the Secretary thereafter

sought appropriations to carry out the recommendations to

improve USDA's civil rights efforts. Pigford, 185 F.R.D. at

111.

On August 28, 1997, three African-American farmers filed

suit on behalf of a putative class of similarly situated AfricanAmerican farmers alleging racial discrimination in the administration of USDA programs and further harm from the

allegedly surreptitious dismantling of USDA's Office of Civil

Rights in 1983, which together were alleged to violate the

Fifth Amendment, the Administrative Procedure Act, 5

U.S.C. s 551 et seq.; Title VI of the Civil Rights Act of 1964,

42 U.S.C. s 2000d; and the Equal Credit Opportunity Act

("ECOA"), 15 U.S.C. s 1691, prohibiting discrimination in

consumer credit. Following amendments to the complaint,

the district court granted class certification in October 1998.

See Pigford, 185 F.R.D. at 90. At that time, most of the

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farmers' ECOA claims were arguably barred by a two-year

statute of limitations. See 15 U.S.C. s 1691e(f). Responding

to petitions from class members, Congress enacted, and the

President signed in November 1998, an amendment to retroactively extend the limitations period for persons who had

filed administrative complaints between January 1, 1981, and

July 1, 1997, for acts of discrimination occurring between

January 1, 1981, and December 31, 1996.3 A second class

action, Brewington v. Glickman, Civ. No. 98-1693, filed in

July 1998 and making similar allegations covering a different

time period, was consolidated with Pigford for purposes of

settlement, and a new class was certified. See Pigford, 185

F.R.D. at 90.

As the February 1999 trial date drew near, the parties'

negotiations shifted from individual claims to a global settlement, id., and with the assistance of a court-appointed mediator, the parties developed and agreed to a consent decree that

contemplated a two-track dispute resolution mechanism to

determine whether individual class members had been the

victims of discrimination and, if so, the amount of monetary

relief to which they were entitled. If a class member opts for

resolution under Track A, "class members with little or no

documentary evidence [will receive] a virtually automatic cash

payment of $50,000 and forgiveness of any debt owed to

USDA," id. at 95; whereas, class members opting for Track

B resolution have the opportunity to prove their claims in a

one-day mini-trial before an arbitrator and, if successful, the

amount of monetary damages is not capped. Id. Class

members dissatisfied with the opportunity for resolution of

their claims under either Track A or Track B could opt out of

the class within 120 days of entry of the consent decree, and

__________

3 See Pub. L. No. 105-277, s 741, 112 Stat. 2681 (codified at 7

U.S.C. s 2297, notes); see also Statement By President William J.

Clinton Upon Signing H.R. 4328, 34 Weekly Comp. Pres. Doc. 2108

(Nov. 2, 1998) ("This bill will also address the long-standing discrimination claims of many minority farmers by adopting my request to

waive the statute of limitations on USDA discrimination complaints

that date back to the early 1980s."), reprinted in 1998 U.S.C.C.A.N.

582.

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file individual lawsuits. Id. The district court is to appoint a

monitor from a list of names provided by the parties "to track

and report on USDA's compliance with the terms of the

Consent Decree." Id. at 109.

By law, the proposed consent decree could not take effect

until the district court had approved it, see Fed. R. Civ. P.

23(e), and the district court's approval could not be granted

until notice had been given to the class of the proposed

settlement and a fairness hearing had been held to determine

whether the "settlement is fair, adequate, and reasonable and

is not the product of collusion between the parties." Pigford,

185 F.R.D. at 98 (quoting Thomas v. Albright, 139 F.3d 227,

231 (D.C. Cir. 1998)). The district court held a day-long

hearing in which representatives of eight organizations and

sixteen individuals, including Mr. Cooper, voiced their objections to the terms of the proposed consent decree. Many,

including Mr. Cooper, objected to the absence of certain

forms of prospective structural relief, notwithstanding the

fact that the complaint, as amended, did not seek such

injunctive relief. Id. at 110. While USDA was likely to face

billion-dollar monetary liability under the decree, no changes

to the county committee system were mandated, and objectors feared that no improvements would be made to the way

in which the farm credit and non-credit programs are administered. See Transcript of Fairness Hearing ("Tr."), Mar. 2,

1999 at Joint Appendix (JA) 388 (Mr. Bowens); 493 (Mr.

Cooper). They also maintained that insufficient information

had been exchanged during the discovery period leading up to

the settlement. However, at the fairness hearing, neither

Mr. Cooper nor his counsel voiced the objections raised now

on appeal to paragraphs 19 and 21 of the decree. Instead the

National Council of Community Based Organizations in Agriculture ("NCCBOA") argued to the district court that paragraph 19 "contemplates that a future statute or regulation

may interfere with the relief that is provided by the decree."

Tr. at JA 410. Without specifically mentioning paragraph 21,

NCCBOA objected to that provision on the grounds that the

class members "are remitted to contract law claims against

the Government, but the contract here expressly provides

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that they can't have their claims reinstated and the Government has got a defense because of its new regulation to the

relief that's provided by the Consent Decree." Tr. at JA 411.

Following the hearing, the district court suggested fourteen

changes to the proposed consent decree, including modifying

paragraph 19 to require USDA to use its best efforts to

comply with laws prohibiting discrimination and modifying

paragraph 21 to make clear that the district court retained

jurisdiction to enforce the consent decree with its contempt

power. The class and USDA rejected the first suggestion

and adopted the second. The district court then allowed

another round of written objections to be filed to the revised

consent decree.4 After considering all of the objections and

the entire record, the district court approved the proposed

consent decree as fair under Rule 23 and ordered that the

decree be entered. Mr. Cooper noted an appeal from the

order, but he did not seek a stay of proceedings under the

consent decree pending appeal.5

__________

4 Objections made directly by Mr. Cooper questioned whether

class counsel truly represented the interests of the class members

and suggested that the decree contain a provision rendering it void

if either USDA or class counsel took steps to obstruct the district

court's jurisdiction to enforce the proposed decree. Mr. Cooper's

counsel, on behalf of Mr. Cooper, filed eight pages of objections,

which also questioned the capacity of class counsel to represent the

class, but made no mention of either paragraphs 19 nor 21 nor of

the enforceability of the decree as a general matter. In addition,

the North Carolina Association of Black Lawyers Land Loss Prevention Project at North Carolina Central University Law School

filed a set of objections jointly with three other organizations,

including NCCBOA, which stressed, among other things, the view

that in light of paragraphs 19 and 21, the district court's contempt

power was inadequate to enforce the decree.

5 Although the figures differ, USDA and class counsel represented in their respective briefs that more than 20,000 persons have

filed claims under the decree. See Appellee USDA's Br. at 15;

Appellee Plaintiff Class' Br. at 12. At oral argument, class counsel

represented that as of February 25, 2000, decisions in 9,573 Track A

cases had been rendered of which 5,746 claims were granted and

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II.

The law is well settled that the decision to approve a

consent decree is committed to the sound discretion of the

district court. See, e.g., In re Prudential Ins. Co. of Am. Sales

Practices Litig., 148 F.3d 283, 299 (3d Cir. 1998). The

district court's role in reviewing the decree is to protect the

interests of absent class members, and that is done primarily

by evaluating the terms of the settlement in relation to the

strength of their case. See Thomas, 139 F.3d at 231. The

appellate court is not to substitute its views of fairness for

those of the district court and the parties to the agreement,

see Class Plaintiffs v. City of Seattle, 955 F.2d 1268, 1276 (9th

Cir. 1992), but is only to determine whether the district

court's reasons for approving the decree evidence appreciation of the relevant facts and reasoned analysis of those facts

in light of the purposes of Rule 23. See Thomas, 139 F.3d at

231; see also Kickapoo Tribes v. Babbitt, 43 F.2d 1491, 1495

(D.C. Cir. 1995). Mr. Cooper bears the burden on appeal of

making a "clear showing" that an abuse of discretion has

occurred. See Moore v. National Ass'n of Sec. Dealers, 762

F.2d 1093, 1107 (D.C. Cir. 1985). He has not done so; on the

contrary, the district court fulfilled the requirements of Rule

23 in exemplary fashion.

On appeal Mr. Cooper has abandoned the objections he

raised in the district court regarding the lack of prospective

structural relief and confines his challenge to the consent

decree to paragraphs 19 and 21, which he contends give

USDA, in effect, the right to unilaterally withdraw from the

consent decree leaving class members with no judicial remedy. Mr. Cooper thus contends that the district court erred

by failing to notify class members specifically of the terms of

__________

paid in an amount totaling $359,125,000. Of the 3,827 Track A

claims that were denied in whole or in part, one third have been

appealed under the terms of the consent decree. In addition,

approximately 146 class members have opted for resolution under

Track B. Four cases have been completed, and eighty others are in

discovery.

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the two paragraphs and by approving the decree without

requiring alteration or deletion of the two paragraphs.6

In his opening brief, Mr. Cooper contended that USDA can

use paragraph 19 to renege on its agreement in the consent

decree in one of three ways: (1) Congress could pass new

legislation that USDA could interpret to preclude some or all

of the relief provided by the decree; (2) USDA could promulgate new regulations to the same effect without new legislation; or (3) USDA could interpret existing law to bar the

relief provided in the decree without promulgating a rule. In

subsequent briefing by appellees class counsel and USDA,

__________

6 The paragraphs under attack provide:

19. Defendant's Duty Consistent With Law and Regulations

Nothing contained in this Consent Decree or in the Final

Judgment shall impose on the defendant any duty, obligation or

requirement, the performance of which would be inconsistent

with federal statutes or federal regulations in effect at the time

of such performance.

....

21. No Effect if Default

Subject to the terms of p 17, above, [conditioning the decree's

obligations on a final judgment dismissing the complaint] and

following entry by the Court of Final Judgment, no default by

any person or party to this consent Decree in the performance

of any of the covenants or obligations under this Consent

Decree, or any judgment or order entered in connection therewith, shall affect the dismissal of the complaint, the preclusion

of prosecution of actions, the discharge and release of the

defendant, or the judgment entered approving these provisions.

Nothing in the preceding sentence shall be construed to affect

the Court's jurisdiction to enforce the Consent Decree on a

motion for contempt filed in accordance with p 13 [requiring

parties to conciliate before filing contempt motion].

The last sentence of paragraph 21 was added after the fairness

hearing.

and at oral argument, it has been clarified that there was no

intent that paragraph 19 include the second and third possibilities; rather, USDA stipulates, and class counsel concurs,

in their respective briefs that paragraph 19 "simply recognizes the legal reality that Congress makes the laws, and that

it is the obligation of the government to perform prospectively in conformance with the then binding laws enacted by

Congress." See Appellee USDA's Br. at 25; Appellee Plaintiff Class' Br. at 11.

With that clarification, USDA's promise to perform under

the consent decree is not illusory because USDA has not

reserved a unilateral right to withdraw, cf. Gray v. American

Express Co., 743 F.2d 10, 19 (D.C. Cir. 1984) (interpreting

New York law), rather it would take action by Congress to

enable USDA to withdraw from the consent decree. ConseUSCA Case #99-5222 Document #507552 Filed: 03/31/2000 Page 9 of 14
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quently, under elementary principles of contract law, USDA's

promise to perform was backed by consideration at the time

it was made and the parties have assigned to the plaintiff

class the marginal risk that Congress might nullify the agreement in some respect by future legislation. Although the

evidence before the district court establishes the basis for

class members' mistrust of USDA and concern that the risk

may be more than hypothetical, see Pigford, 185 F.R.D. at

110, the fact that Congress and the President acted quickly to

remove a limitations bar to the plaintiffs' recovery indicates

that as of October 1998 all three branches of the federal

government had taken steps to aid in the final resolution of

the farmers' claims on the merits. The district court noted

the priority commitment of the President and the Secretary

of Agriculture, spurred by the efforts of the African-American farmers, to obtain funding to carry out recommendations

improving USDA's civil rights efforts, as well as Congress'

"unprecedented action of tolling the statute of limitations."

Id. at 111. And Mr. Cooper acknowledged through counsel

on appeal that he has no evidence that this three-branch

commitment has waned. The district court could therefore

reasonably conclude when approving the decree that the risk

of a radical about-face in current federal policy was remote.

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More fundamentally, even in the absence of paragraph 19,

the class would bear the risk of such hypothetical legislation,

at least so long as the decree remains executory. See Pennsylvania v. Wheeling and Belmont Bridge Co., 59 U.S. (18

How.) 421, 431-32 (1855); BellSouth Corp. v. FCC, 162 F.3d

678, 692-93 (D.C. Cir. 1998); see also Landgraf v. USI Film

Products, 511 U.S. 244, 273-274 (1994); Rufo v. Inmates of

Suffolk County Jail, 502 U.S. 367, 378 (1992).7 Thus, we

need not pass upon Mr. Cooper's' contentions concerning

possible constitutional limitations on Congress' power to enact

such legislation, see Plaut v. Spendthrift Farm, Inc., 514 U.S.

211 (1995), nor address the ramifications of such legislation

under the reasoning of United States v. Winstar Corp., 518

U.S. 839 (1996), to conclude that the district court did not

abuse its discretion by approving the proposed consent decree, as amended, which assigns a risk to the plaintiff class

that it would have borne in any event.

As to Mr. Cooper's contention that paragraph 21 deprives

the farmers of the right to ask the district court to modify the

decree or reinstate their lawsuit in the unlikely event that

Congress passes legislation nullifying the decree, it too relies

on a misplaced concern. Paragraph 21 provides that if the

government defaults on its obligations under the decree, the

plaintiff class can enforce the decree only by motion for civil

contempt. Mr. Cooper reads this provision to also "strip[ ]

the district court of its authority to reopen the final judgment" if Congress enacts legislation allowing for the decree to

be nullified in whole or in part. However, the very basis for

Mr. Cooper's contention concerning paragraph 19 is, and

USDA agrees, that USDA would not be in default under the

agreement if Congress passed new legislation nullifying, or

directing the Secretary to nullify by regulation, the consent

decree. Because that action would not qualify as a default,

the provisions of paragraph 21 would not apply. Thus, Mr.

__________

7 It is to be noted that the relief Mr. Cooper seeks, an order

vacating the decree and remanding for trial, could require that

plaintiffs' cases be tried over a number of years, see Pigford, 185

F.R.D. at 104, and thus could expose class members to this risk for

a far longer period.

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Cooper's contention that the consent decree is unfair because

the class would not be able to seek relief under Rule 60(b) of

the Federal Rules of Civil Procedure is mistaken. On its

face, paragraph 21 does not foreclose that avenue of relief

when USDA has not defaulted, and thus were Congress to

enact the hypothesized legislation, paragraph 21 would not

bar the class from seeking modification of the decree, subject

to its ability to "establish that a significant change in facts or

law warrants revision of the decree and that the proposed

modification is suitably tailored to the changed circumstance."

Rufo, 502 U.S. at 393.

Moreover, not only do Mr. Cooper's contentions collapse

under their own weight, but even were they to retain some

persuasive force, the court must evaluate the district court's

decision to approve the consent decree, with whatever shortcomings paragraphs 19 and 21 might present, in light of the

agreement as a whole. See Thomas, 139 F.3d at 231. In that

context, there is no doubt that the district court exercised its

discretion well within the boundaries of the law. The serious

concerns and objections to the proposed consent decree were

carefully considered by the district court and balanced

against the likely alternatives in a manner reflecting a considered and compassionate conclusion. See, e.g., Pigford, 185

F.R.D. at 101-04, 109-111. Neither Mr. Cooper nor, to our

knowledge, any other class member contends at this point

that the provisions of the consent decree providing monetary

payments and loan forgiveness are unfair or unreasonable,

and we have no occasion to consider whether these provisions

are otherwise unfair or unreasonable. As a result, Mr.

Cooper has failed to meet his burden to show that the

enforcement provisions of the decree are so infirm as to

render the entire agreement unfair or unreasonable. Furthermore, our reasons for finding Mr. Cooper's substantive

contentions unpersuasive also lead us to reject his procedural

contentions that the district court did not address the objections to paragraphs 19 and 21 with sufficient specificity and

that notice to the class was inadequate because it did not

specifically describe paragraphs 19 and 21.

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The ultimate question before the court is whether the

district court abused its discretion by approving a consent

decree, the principal provisions of which are an indisputably

fair and reasonable resolution of the class complaint, containing one paragraph that assigns to the class a risk it would

have borne in any event and another paragraph that limits

the mode of enforcing the decree in the event of default. To

ask the question is to answer it. Because it is clear that no

abuse of discretion occurred we do not reach the government's alternative argument concerning whether it would be

equitable for this court to vacate the decree in light of the

number of claims that have been resolved in reliance on the

decree.

Accordingly, we affirm the order of approval of the district

court.

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APPENDIX

(Pages 14 through 79 of slip opinion not available 

electronically)

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