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In the United States Court of Federal Claims

No. 09-504L

(Filed: April 15, 2015)

* * * * * * * * * * * * * * * * * * * * * * * * * * * * 

*

HUNNESHAGEN FAMILY TRUST OF *

JUNE 25, 1999, Individually, For Itself, and *

As a Representative of a Class of Similarly * 

Situated Persons, *

 *

Plaintiffs, *

*

v. *

*

THE UNITED STATES, *

*

Defendant. *

*

* * * * * * * * * * * * * * * * * * * * * * * * * * * * 

J. Robert Sears and Steven M. Wald, 1010 Market Street, Suite 950, St. Louis, MO, 63102, 

for Plaintiffs. Thomas S. Stewart and Elizabeth G. McCulley, 2400 Pershing Road, Suite 500, 

Kansas City, MO 64108, for Plaintiffs.

John C. Cruden and Alison D. Gardner, United States Department of Justice, Environment 

and Natural Resources Division, P.O. Box 7611, Washington, D.C. 20044. 

_________________________________________

OPINION AND ORDER APPROVING SETTLEMENT AGREEMENT

__________________________________________

This case arises from the federal Surface Transportation Board’s issuance of a Notice of 

Interim Trail Use on a 17-mile long former railroad corridor running across Plaintiffs’ land near 

Judson, Indiana and Monterey, Indiana. Plaintiffs allege that the Government’s action constituted 

a taking of their property interests under the Fifth Amendment to the United States Constitution. 

To resolve all claims in this case, the parties reached an agreement that will provide Plaintiffs with 

the appraised fair market value of their property interests and pre-judgment interest on their claims. 

Class counsel will receive attorneys’ fees and costs as authorized by the fee-shifting provision of 

the Uniform Relocation Assistance and Real Property Acquisition Policies Act ("URA"). See 42 

U.S.C. § 4654(c) (2012).1 The parties now ask the Court to approve this settlement. 

 

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 Generally, in the United States, each party to a lawsuit bears its own attorneys’ fees and 

costs. See Bywaters v. United States, 670 F.3d 1221, 1226-27 (Fed. Cir. 2012). However, for 

Rails-to-Trails Act Settlement; Class 

Action Settlement; Approval of 

Settlement As Fair, Reasonable, and 

Adequate; Rule 23(e).
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The Court gave preliminary approval to the settlement agreement on February 10, 2015,

and a fairness hearing was conducted on April 8, 2015, in Lafayette, Indiana. For the reasons 

discussed below, the settlement of this class action is approved

Background

Terms of Settlement Agreement 

The present action was filed on August 3, 2009, and on October 16, 2009, the Court granted 

Plaintiffs’ motion for class certification and the parties’ joint proposed plan for providing notice 

to the opt-in class and appointed Plaintiffs’ proposed class counsel. Beginning in 2012, the parties 

entered into an appraisal and settlement process for resolving the claims in this case. The proposed 

settlement agreement resolves the claims of all of the 55 named Plaintiffs and class members.

As part of the proposed class settlement, the Government has agreed to pay 50 Plaintiffs 

the fair market value of the property which they allege has been taken, based on the parties’ agreedupon appraisal of the properties.2 The agreed-upon fair market value of the Plaintiffs’ combined 

property interests is $278,000. The Government has also agreed to pay pre-judgment interest of 

$167,968.10, which has been calculated as 4.2% compounded annually based on an anticipated 

payment date of May 15, 2015. Consistent with the fee-shifting provision of the URA, the 

Government has agreed to pay $376,800 in attorneys’ fees and costs, consisting of attorneys’ fees 

of $370,000 and $6,800 in litigation expenses. As noted above, these fees and costs are authorized 

 

certain types of cases, Congress has enacted statutes that shift some of the burden of paying 

attorneys’ fees and costs from a plaintiff to a defendant. Id. The fee-shifting provision of the URA 

is one example. The URA states in relevant part:

The court rendering a judgment for the plaintiff in a proceeding brought under 

section 1346(a)(2) or 1491 of Title 28, awarding compensation for the taking of 

property by a Federal agency, or the Attorney General effecting a settlement of any 

such proceeding, shall determine and award or allow to such plaintiff, as a part of 

such judgment or settlement, such sum as will in the opinion of the court or the 

Attorney General reimburse such plaintiff for his reasonable costs, disbursements, 

and expenses, including reasonable attorney, appraisal, and engineering fees, 

actually incurred because of such proceeding.

42 U.S.C. § 4654(c) (2012).

2 On April 8, 2015, during the settlement fairness hearing, class counsel represented that the 

settlement amounts had increased due to the parties’ inadvertent failure to include the value of part 

of a parcel in their joint motion for preliminary approval of the settlement. The original amounts 

were $275,611 in compensation for Plaintiffs and $166,524.66 in pre-judgment interest. The 

amount of attorneys’ fees and costs was not altered. 
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under the “fee-shifting” provision of the URA. 42 U.S.C. § 4654(c) (2012). Therefore, the total 

settlement payment is $822,768.10. The parties have agreed and notified five Plaintiffs that they 

are not entitled to compensation because they did not own property along the former railway 

corridor at the time of the taking.

Notice of Settlement to Class Members and the Fairness Hearing 

On February 10, 2015, the Court gave preliminary approval to the proposed settlement 

agreement, approved the parties’ joint proposed plan for providing notice to the class members of 

the proposed settlement, with certain modifications, and scheduled a fairness hearing for April 8, 

2015. The notice to the class members solicited written comments from the class members 

regarding the proposed settlement agreement and also provided that there would be an opportunity 

for any class member to speak at the hearing. Plaintiffs’ counsel indicated that they received 46 

out of 50 responses, and no Plaintiff objected to the settlement. Two Plaintiffs provided comments 

– one stated that he “would rather have the ground then [sic] this settlement” and that the “trail 

program is only going to cause trouble and problems.” Another Plaintiff stated:

Per discussion with J. Robert Sears – subject property remains with land owner. 

The easement that the rail road had was transferred to Indiana Trails. The same 

provisions remain, that if Indiana Trails no longer uses the trail, the use of the land 

returns to the land owner.

The Court conducted a fairness hearing on April 8, 2015 at the United States District Court 

for the Northern District of Indiana, Charles A. Halleck Federal Building, 230 North Fourth Street, 

Lafayette, Indiana. During this hearing, the parties described the joint appraisal process, provided 

their rationales as to why the settlement should be approved, and answered the Court’s questions. 

Discussion

Under Rule 23(e) of the Rules of the United States Court of Federal Claims, the Court may

approve a proposed settlement “only after a hearing and on finding that it is fair, reasonable, and 

adequate.” See Moore v. United States, 63 Fed. Cl. 781, 783 (2005) (citing In re General Motors 

Corp. Pick-Up Truck Fuel Tank Prod. Liab. Litig., 55 F.3d 768, 785 (3rd Cir. 1995)). The Court 

has discretion to accept or reject a proposed settlement, but it may not alter the proposed settlement, 

nor may it decide the merits of the case or resolve unsettled legal questions. Adams v. United 

States, 107 Fed. Cl. 74, 75-76 (2012) (citing Evans v. Jeff D., 475 U.S. 717, 726-27 (1986); Nat'l 

Treasury Emps. Union v. United States, 54 Fed. Cl. 791, 797 (2002)).

There is no definitive list of factors that the Court must apply in considering a class action 

settlement. Raulerson v. United States, 108 Fed. Cl. 675, 677 (2013). However, in determining 

whether a settlement agreement is “fair, reasonable, and adequate,” courts have found the 

following factors instructive: (1) the relative strengths of the plaintiffs’ case compared to the 

proposed settlement; (2) the recommendation of counsel for the class regarding the proposed 

settlement, taking into account the adequacy of class counsel’s representation of the class; (3) the 
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reaction of the class members to the proposed settlement, taking into account the adequacy of 

notice to the class members of the settlement terms; (4) the fairness of the settlement to the entire 

class; (5) the fairness of the proposed attorney fees; and (6) the ability of the defendants to 

withstand a greater judgment, taking into account whether the defendant is a governmental actor 

or private entity. Sabo v. United States, 102 Fed. Cl. 619, 627 (2011). The Court has considerable 

discretion as to what weight to afford each factor in the context of the case before it, and settlement 

is always favored. Id. at 627. As set forth below, these factors militate in favor of approval. The 

Court finds that that the joint proposed settlement is fair, reasonable, and adequate.

The Relative Strength of Plaintiffs’ Case Compared to the Proposed Settlement

In the instant case, the parties fully briefed cross-motions for summary judgment on 

liability. Defendant also moved to certify questions of state law to the Indiana Supreme Court as 

to whether railroad rights-of-way remained burdened by railroad easements pursuant to Indiana 

Code and whether, under Indiana law, interim trail use is within the scope of a railroad’s easement. 

As another Judge of this Court had recently submitted similar questions of state law to the Indiana 

Supreme Court in an unrelated case, the Court stayed this action pending the Indiana Supreme 

Court’s disposition of the certified questions. On March 23, 2012, the parties filed a joint notice 

indicating that the Indiana Supreme Court had issued a decision upon the certified questions and 

that the parties were open to exploring settlement. In the subsequent months, the parties reached 

agreement on an appraisal process and a method of determining just compensation. Although in 

June 2014, problems arose regarding the appraiser’s reports and the interpretation of specific 

deeds, by September 2014, the parties represented that they had reached a tentative settlement on 

all issues. 

As this case never reached a decision on summary judgment, this Court did not assess 

independently the class members’ claims or the quantum. However, the parties benefited from the 

Indiana Supreme Court’s response to the certified question and its ruling that public trail use was 

not within the scope of easements acquired for the purpose of operating a rail line. See Howard v. 

United States, 964 N.E.2d 779 (Ind. 2012). 

The settlement requires Defendant to pay a large majority of the class members the full 

value of their damages as determined by the joint appraisal, as well as pre-judgment interest and 

statutory attorney’s fees and costs. See Raulerson, 108 Fed. Cl. at 678. Both parties considered it 

in their best interests to forego the risks of litigation and pursue a negotiated settlement after the 

ruling of the Indiana Supreme Court. Based on the legal guidance provided by the Indiana Supreme 

Court and the careful and well-documented appraisals, the Court is persuaded that the strength of 

Plaintiffs’ case warranted this expenditure of taxpayer dollars in settlement.

The Recommendations of Class Counsel, Taking Into Account the Adequacy of Class 

Counsels’ Representation

“[T]he professional judgment of plaintiff’s counsel is entitled to considerable weight in the 

court’s determination of the overall adequacy of the settlement.” Dauphin Island Property Owners 
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Association, Inc. v. United States, 90 Fed. Cl. 95, 104 (2009) (quoting Nat’l Treasury Emps.

Union, 54 Fed. Cl. at 797). Here, class counsel recommended settlement after effectively 

advocating on behalf of the class for over four years, including overseeing an extensive joint 

appraisal process. Additionally, class counsel capably represented their clients during this action 

and presented a cogent and compelling argument supporting the proposed settlement at the fairness 

hearing. Defendant’s counsel carefully scrutinized the settlement and was actively involved in 

coordinating the appraisal process and conducted appropriate site visits. The recommendation of 

class counsel was thus informed by Defendant’s counsel’s active participation in the settlement 

process and by an in-depth analysis by an appraiser approved by Defendant. Thus, this factor 

favors approval.

The Reaction of the Class Members to the Proposed Settlement, Taking into Account 

the Adequacy of the Notice to the Class Members of the Settlement Terms

Pursuant to the Court’s preliminary approval, class counsel served class members with a 

detailed notice of the settlement and a list of each Plaintiffs’ award or whether their claim would 

be dismissed. No class members objected to the proposed settlement, with only two providing 

comments. These comments do not contest the settlement, as one Plaintiff indicated that she 

understood that Indiana Trails had an easement on her land and the other generally disagreed with 

the rails-to-trails process. This lack of objection strongly favors approval. Dauphin, 90 Fed. Cl. at 

104. 

The Fairness of the Settlement to the Entire Class

A settlement meets this factor if its relief is “uniformly available, yet simultaneously 

tailored to distinct groups within the class.” Sabo, 102 Fed. Cl. at 629 (quoting Berkley v. United 

States, 59 Fed. Cl. 675, 711 (2004)). This settlement is the culmination of arms-length negotiation 

and appraisal. The parties retained a joint appraiser, who, pursuant to a set of instructions agreed 

to by the parties, appraised representative parcels and extrapolated the values of each to similar 

parcels within each represented group. The parties’ counsels also attended a site visit with the 

appraiser. Each party separately viewed the appraisals and brought any questions or concerns to 

the appraiser, who considered them and made adjustments if warranted. After reviewing the final 

appraisal reports, the parties conducted arms-length negotiations. 

Except for the five claimants whose claims will be dismissed because the parties agree that 

they do not have the requisite property interest in the former railway corridor, class members will 

receive the fair market value of their individual property interests based on this common appraisal 

process. The agreement does not single out or reward one class member over another. As such, 

this process was both fair to the individual class members and the class as a whole. No Plaintiff 

objected to the settlement agreement, indicating consent to the compensation determined by the 

appraisal process. 
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The Fairness of the Provision for Attorney’s Fees

Class counsel does not seek reimbursement of attorney’s fees and or costs from Plaintiffs 

out of their compensation settlement award. The settlement’s attorney-fee provision must also be 

reasonable. Dauphin, 90 Fed. Cl. at 106. Here, the Government agreed to pay $376,800 in 

attorneys’ fees and costs, consisting of attorneys’ fees of $370,000 and $6,800 in litigation 

expenses. As noted above, the URA provides, in Fifth Amendment cases such as this one, for the 

reimbursement of plaintiffs for their “reasonable costs, disbursements, and expenses, including 

reasonable attorney, appraisal, and engineering fees, actually incurred” during the litigation, as 

approved by the Attorney General. 42 U.S.C. § 4654(c) (2012). In evaluating such awards, the 

Attorney General’s opinion is entitled to deference, and the Court does not conduct the same indepth analysis as it would if it were rendering the award. Moore, 63 Fed. Cl. at 785 n.6. 

In this case, attorneys’ fees did not form the basis of any objection to the settlement 

agreement. Taking into account the deference owed to the Attorney General in these 

circumstances, the Court finds that the attorneys’ fees and costs provision in the settlement 

agreement is fair and reasonable.

Ability of Defendant to Withstand Greater Judgment

Although the Government can “theoretically ‘always withstand greater judgment because 

of Congresses’ ability to tax’ it would ultimately fall to the taxpayers to provide the necessary 

funds.” Dauphin, 90 Fed. Cl. at 106 (quoting Berkley, 59 Fed. Cl. at 713). Therefore, as Defendant 

is a governmental entity, the Court does not give this factor any weight. 

Conclusion

For all of these reasons, the Court APPROVES the parties’ proposed settlement agreement

and finds that it is fair, reasonable, and adequate. The parties shall disburse payments as agreed in 

the settlement and shall file a notice of compliance once payment is completed. The total judgment 

in favor of Plaintiffs, pursuant to the parties’ settlement, is $822,768.10, consisting of $278,000

in principal, $167.968.10 in pre-judgment interest, and $376,800 in attorneys’ fees and costs 

authorized under the fee-shifting provision of the URA. 42 U.S.C. § 4654(c) (2012). The Clerk 

shall enter judgment accordingly. The Clerk shall also dismiss the claims of Plaintiffs Dorothy 

Keller, Roberta Grapel, Scott and June Morrison, Roger Timmons, and Ronald A. White.

s/Mary Ellen Coster Williams 

MARY ELLEN COSTER WILLIAMS

Judge