Free Response to Motion - District Court of Federal Claims - federal

Case 1:03-cv-02684-CFL

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IN THE UNITED STATES COURT OF FEDERAL CLAIMS ____________________________________ SHELDON PETERS WOLFCHILD, et al., ) ) ) Plaintiffs, ) ) v. ) ) THE UNITED STATES OF AMERICA ) ) Defendant. ) ____________________________________)

Case No. 03-2684L Hon. Charles F. Lettow Electronically filed on February 15, 2007

DEFENDANT'S OPPOSITION TO THE MOTION OF CERTAIN INTERVENORS TO DEFER RULING ON LATE-FILED MOTIONS TO INTERVENE Defendant, the United States, submits this memorandum in response to the Motion of Certain Intervenors to Defer Ruling on Pending Post-Deadline Intervention Motions (Dkt No. 414). The Court should deny the motion to defer ruling on the pending intervention motions because those motions have been fully briefed and are ripe for decision, there is no compelling reason to leave them undecided, and leaving the door open to further motions to intervene, or a standard for intervention to be decided at some time in the future, would severely prejudice the Defendant. The United States discusses these reasons in greater detail, infra. The assertion that deferring ruling on the motions will "avoid a proliferation of motions to intervene and consolidate briefing on them" (Motion To Defer, at ¶ 2) lacks force, because there has already been a proliferation of motions, Defendant has already filed responses to them (incurring the expense and consuming the time and other resources to do so), and with one exception, the motions have been fully briefed. In other words, the negative consequences of

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"sporadic and repetitive" motions have already occurred. Furthermore, ruling on the post-July 12 motions has in fact already been deferred ­ in some cases, for months; and consolidated argument on the motions has taken place. The motions should be decided before further proceedings on the merits, so that all intervenors may fully participate in those proceedings. The assertion that persons "whose names were not included on motions to intervene filed prior to the July [12,] 2006[,] deadline" have communicated with counsel for movants (Motion to Defer, at ¶ 3) provides no reason to defer ruling on the filed motions. In fact, it weighs in favor of adhering to the cutoff date established by the Court so the litigation can move forward to resolution. There may never be an end to persons seeking information about, or entry into, the case, and if resolution of the motions is deferred until such communications stop, the lawsuit will never be resolved. Moreover, the assertion about more potential litigants contacting existing counsel suggests that the goal of movants' request is not only to defer ruling on the pending motions to intervene, but to reach back and erase the July 12, 2006, deadline entirely so that additional motions to intervene would be entertained in the future. The rest of the motion to defer sends that same signal. One example is movants' assertion that "questions of intervention (and the right to intervene) should be considered only after the resolution of several underlying issues in the case." (Motion To Defer, ¶ 5 (emphasis in original)). Another is the statement that "further notice" to potential intervenors might be "require[d]." The assertion that "factors that have not yet been litigated in the case" may affect what constitutes "good cause" has a similar import ­ it shows that is what movants really mean when they claim there is no "articulated standard" of good cause for late motions to intervene.

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The suggestion that grounds for intervention may or should be examined through a different lens later in the case cuts directly against the principle of "orderly" joinder that this Court cited and sought to follow when it ordered that notice be issued to potential plaintiffintervenors. See Wolfchild v. United States, 68 Fed. Cl. 779, 783 (2005)("Wolfchild II"), referring to the Court's earlier opinion, Wolfchild v. United States, 62 Fed. Cl. 521, 554-55 ("Wolfchild I"), citing Hoffman-La Roche Inc. v. Sperling, 493 U.S 165 at 170, 171 (1989). Furthermore, Defendant would suffer severe prejudice if it has to re-brief the currently-pending motions to intervene after different standards for intervention are imposed. Likewise, all parties would be prejudiced by the delay, and the Court would be unduly burdened, if the Court had to re-examine all the motions at a later stage in the case. As for an "articulated standard" for good cause, that phrase is by nature a "highly abstract and relative term." Effingham County Board of Education v. United States, 7 Cl. Ct. 34, 38 (1984)(discussing the meaning of "good cause" as used in RUSCC 14(a)(3))1/. Accordingly, what is required to show good cause "depend[s] in large measure upon the circumstances of each individual case, and the finding, the existence or absence thereof, lies largely within the sound discretion of the court." Effingham County Board of Education, supra, 7 Cl. Ct at 39. The fact that the Court has not specifically "articulated" a hard and fast list of required elements for "good cause" for late intervention in this lawsuit does not mean that it may not now decide the pending and fully-briefed motions, exercising its "sound discretion" under all the circumstances, as circumscribed by the requirements of Rule 24 and the caselaw interpreting it. Movants also assert as a ground for deferral their "belief" that the statute of limitations

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Rule of United States Court of Claims 14, the predecessor of RCFC 14. 3

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period for "breach of trust claims against the United States" has not run. Based on that belief, movants say, there is no need to decide the intervention motions now. Even if movants were correct that the limitations period has not expired (which the United States does not concede), that circumstance would not mean that ruling on motions to intervene could properly be deferred indefinitely. There is no requirement that the door to joinder in this case or any other be left open until all concerned agree that any additional claims would be time-barred. And to do so would not be consistent with the Court's obligation to ensure that joinder proceeds in an orderly manner. Moreover, contrary to movants' "belief" about limitations, the United States maintains that most (if not all) portions of the breach of trust claim2/ in this case are time-barred, pursuant to the six-year limitations period provided by 28 U.S.C. § 2501 (2006). The only claims that might arguably be preserved pursuant to the "Indian Trust Accounting Statute" (or "ITAS")3/are claims of trust fund mismanagement, as distinct from alleged asset mismanagement or trust mismanagement. See, e.g., Shoshone Indian Tribe of the Wind River Reservation v United States, 364 F. 3d 1339, 1350 (Fed. Cir. 2004). Yet the gravamen of Plaintiffs' breach of trust claim in the lawsuit is that the United

The United States recognizes that although the Court held that Plaintiffs' purported claim for "breach of contract" is barred by the statute of limitations (Wolfchild I, supra, 62 Fed. Cl. at 548-549), it held that "the statute of limitations does not bar plaintiffs' claim of breach of fiduciary duty because of the Indian Trust Accounting Statute." 62 Fed. Cl. at 551. Defendant nevertheless summarizes some of its arguments on that issue here in response to movants' assertions, for the ease of reference of the Court and of movants. The provision to which this Court referred in Wolfchild I, supra, 62 Fed. Cl. at 551, is part of the Department of the Interior and Related Agencies Appropriations Act, Pub. L. No. 108-108, 117 Stat. 1241, 1263 (2003). 4
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States failed to "maintain the 1886 Lands in trust for" the alleged beneficiary class of Mdewakanton Indians and their descendants, and failed to "ensure that the uses and benefits of the 1886 Lands were distributed as equally as practicable among all of" the alleged trust beneficiaries and no other persons. (Complaint and First Amended Complaint ¶¶ 36-39; Second Amended Complaint, § 24; Revised Third Amended Complaint, § 24 ). Even assuming, arguendo only, that any trust existed before the passage of the 1980 Act, Plaintiffs' claims that the United States misidentified the beneficiary of that alleged trust, failed to acknowledge the so-called Lineal Descendants as the proper beneficiaries of the alleged trust, failed to maintain the 1886 Lands for their benefit, and failed to see that "the uses and benefits" of the lands accrued to Plaintiffs, constitute alleged mismanagement of the purported trust itself, not mismanagement of or losses to "trust funds." Plaintiffs' claims in the instant case therefore do not come within the ambit of those preserved by the Indian trust fund accounting provision, as the Federal Circuit interpreted that provision in Shoshone Indian Tribe, supra. Moreover, the rationale of ITAS is that a beneficiary of an alleged Indian trust cannot be deemed to know he has suffered a loss (that is, the facts giving rise to a potential cause of action against the United States as the trustee), unless and until he has received a proper accounting for his trust funds. In contrast, the existence of the purported claims at issue here was evident to potential plaintiffs without an accounting. Potential plaintiffs knew no later than the passage of the 1980 Act that the lands at issue were being transferred to those they considered to be the "wrong" beneficiaries; and that the "wrong" beneficiaries would receive the "uses and benefits"

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of those lands.)4/. In summary, movants' argument about the statute of limitations is unavailing because the six-year limitations period expired no later than 1986 as to all those claims, with the possible (and narrow) exception of claims regarding any monies earned from certain types of operations on the "1886 lands" before passage of the 1980 Act, which proceeds might, arguendo, be subject to an accounting. (The United States does not concede, however, that any of Plaintiffs' claims are preserved.) Most importantly for the purpose of the motion to defer, regardless whether all or some portion of the "breach of trust" claim in the case is finally determined to be time-barred, that circumstance would not and does not alter the fact that the motions to intervene (or add plaintiffs or intervenors) filed since July 12, 2006, are ripe for decision. To allow the case to go forward, and all who have so far been joined to participate in the proceedings on the merits, the July 12, 2006, cutoff date should be applied and the motion to defer denied.

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Likewise, Plaintiffs' allegation (in the more recent versions of their Complaint) that the United States allegedly breached its fiduciary duty by "permitting the Shakopee members to violate the entitlements, rights and privileges" of Plaintiffs "began with the Department of Interior's initial approval in 1969 of the Shakopee constitution and original membership list" [Revised Third Amended Complaint, ¶ 33] sets the accrual of Plaintiffs' purported claims at an even earlier date. In addition, the nature of such claims lies even farther outside the ambit of the "Indian Trust Accounting Statute." 6

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Dated: February 15, 2007

Respectfully submitted,

MATTHEW J. MCKEOWN Acting Assistant Attorney General Environment and Natural Resources Division

/s/ Laura Maroldy LAURA MAROLDY Natural Resources Section Environment and Natural Resources Division United States Department of Justice Benjamin Franklin Station, P.O. Box 663 Washington, D.C. 20044-0663 Telephone: (202) 514-4565 Facsimile: (202) 305-0506 Email: [email protected] Attorney of Record for the Defendant THOMAS ZIA SARA CULLEY Trial Attorneys Natural Resources Section Environment and Natural Resources Division United States Department of Justice Washington, D.C. 20044-0663

OF COUNSEL: Janet Goodwin Angela Kelsey Office of the Solicitor United States Department of the Interior

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