USDA, DOJ settle class action lawsuit with Native Americans

By Sara Wyant

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Washington, Oct. 20 - Agriculture Secretary Tom Vilsack and Attorney General Eric Holder announced the settlement of a class action lawsuit filed against USDA by Native American farmers alleging discrimination by USDA concerning discrimination complaints from Native Americans during 1981-1999.

Under the settlement agreement announced Tuesday, $680 million will be made available to eligible class members to compensate them for their discrimination claims. In a conference call with reporters yesterday, Secretary Vilsack declined to say how many claimants will be impacted by this decision. According to an expert report prepared by a former USDA economist as part of the case, Native Americans suffered actual economic losses amounting to $776 million between 1981 and 2007 as a result of receiving less than their fair share of credit opportunities from the USDA.

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Two payment “tracks” are available. Under the first track, persons who meet the class definition and provide substantial evidence of discrimination to an impartial adjudicator will receive a uniform settlement of up to $50,000. The second track is for those persons who meet the class definition and believe they have stronger evidence of economic losses caused by discrimination. This track requires a higher evidentiary standard and damage awards are capped at a maximum of up to $250,000 per individual. Actual monetary awards are subject to reduction based on the amount of available funding and the number of meritorious claims.

Unlike the second Pigford lawsuit filed by black farmers and still awaiting congressional appropriations, no congressional action is required to fund the settlement. The Judgment Fund maintained by the U.S. Departments of Justice and Treasury will fund any monetary awards provided under the settlement. USDA will provide up to $20 million to administer the settlement.

In addition to the monetary award, the agreement provides up to $80 million in debt forgiveness to successful claimants with outstanding USDA Farm Loan program debt. Also, a moratorium on foreclosures of most claimants' farms and a moratorium on accelerations and administrative offsets of class members' farm loan accounts will be put into place until after claimants have gone through the claims process or the Secretary of Agriculture has been notified that a claim has been denied.

The settlement also provides a broad range of programmatic relief for Native American farmers, including creation of a new Federal Advisory Council for Native American farmers and ranchers that will include Native American representation from around the country as well as senior USDA officials. Meanwhile, a new Ombudsman position will be created, within the Office of Advocacy and Outreach, to address farm program issues relating to Native American farmers and ranchers as well as all other socially disadvantaged farmers and ranchers.

The Department will also offer Native American farmers enhanced technical assistance services through the establishment of a network that provides intensive instruction to recipients concerning financial, business and market planning skills and supports the deployment of tribal agriculture advocates and third party outreach and education providers. The Agreement calls for USDA to perform a needs assessment for consolidated sub-offices on Indian reservations. The potential costs will likely be determined by that assessment, says a USDA spokesperson.

This lawsuit, Marilyn Keepseagle et al., v. Vilsack (Civil Action No. 99-3119 (D.D.C.)), was filed on November 24th, 1999. The settlement will not become final until it is formally approved by the U.S. District Court for the District of Columbia.

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