Opinion ID: 171193
Heading Depth: 1
Heading Rank: 5

Heading: Bigman v. Utah Navajo Development Council, Inc.

Text: While Jim was still pending, the complaint in Bigman was filed on February 7, 1977, by plaintiffs Seth Bigman and Martha Collins. Although the case was not filed as a class action, the complaint alleged it was an action by Navajo Indians as beneficiaries of an oil royalty trust fund seeking to preserve and protect the fund from defalcation and misexpenditures. Counsel for the Bigman Plaintiffs expressly avoided pursuing a class action due to tension between the original beneficiaries and the beneficiaries added by the 1968 amendment. The complaint alleged that Defendants had breached their fiduciary duty and requested an accounting as well as recovery of all money wrongfully expended from the Fund. Seven months after the complaint was filed, the parties settled, and a Stipulated Judgment and Decree was entered by the Court on August 8, 1977. The settlement provided for review of (1) questionable transactions, as raised by the plaintiffs, of the records and accounts of defendant Utah Navajo Development Council (UNDC) from 1971 until present; (2) the UNDC's accounting and management practices; and (3) the operation and management of medical clinics at Montezuma Creek, Mexican Hat, and Navajo Mountain. Because the Bigman case was not a class action, no notice of the proposed settlement or the district court's review and acceptance of the settlement was provided to non-party beneficiaries. The parties retained Dr. Roger Nelson to perform the review of the three issues set forth in the Stipulated Judgment and Decree. The result of Dr. Nelson's investigation was a detailed report, referred to herein as the Nelson Report, which was filed with the district court on December 12, 1977. Section I of the Nelson Report investigated the management structure and operation of UNDC's service division and medical clinics, as well as the for-profit companies UNDC's affiliate, Utah Navajo Industries, owned and ran. Section II of the Report investigated twenty-six suspect transactions. Section III summarized the management, organizational and accounting problems and Dr. Nelson's recommendations for change. Although available for public inspection, it appears that the Nelson Report was not publicly distributed beyond the named plaintiffs. Per the Stipulated Judgment and Decree, two remaining issues were presented to the district court without trial: (1) plaintiffs' claim that the oil royalty trust funds are not public funds and that defendants were expending the funds for public and governmental purposes, in violation of federal law and the precedents of the court; and (2) plaintiffs' claim that the defendants must implement a program of Navajo preference in employment practices and hiring in the administration and expenditure of the Fund. The court also stated in the Decree that it was not limiting the plaintiffs' or other beneficiaries' right to seek relief from violations of the law in the administration and expenditures of the oil royalty trust funds as may occur subsequent to the filing of this decree. These issues were addressed by a Memorandum and Order issued on September 25, 1978. The district court determined that the preferential employment practices issue did not present a justiciable controversy and refrained from issuing what it characterized as an advisory opinion. The court further found that, on the record before it, it was unable to ascertain whether the State of Utah has exceeded its authority or abused its discretion in directing the use of the funds for [certain specified purposes]. The court then declined to determine the lawfulness of specific expenditures due to lack of any evidentiary basis for doing so. Having retained continuing jurisdiction over the enforcement or amendment of the Stipulated Judgment and Decree, the district court granted the parties' stipulated petition for amendment of the settlement regarding the organization of the UNDC and Utah Navajo Industries, Inc. (UNI). In 1989, the court issued a Stipulation and Joint Motion and Order granting the UNI additional time to repay money it owed to the Navajo Trust Fund. By this time, Eric Swenson, lead plaintiffs' attorney in Bigman, had switched sides and was representing the defendant UNDC. There was no further court activity in the Bigman case.