Cobell, Elouise v. Norton, Gale

391 F.3d 251, 364 U.S. App. D.C. 2, 2004 U.S. App. LEXIS 25142, 2004 WL 2753197
CourtCourt of Appeals for the D.C. Circuit
DecidedDecember 3, 2004
Docket03-5262 and 04-5084
StatusPublished
Cited by245 cases

This text of 391 F.3d 251 (Cobell, Elouise v. Norton, Gale) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Cobell, Elouise v. Norton, Gale, 391 F.3d 251, 364 U.S. App. D.C. 2, 2004 U.S. App. LEXIS 25142, 2004 WL 2753197 (D.C. Cir. 2004).

Opinion

Opinion for the Court filed by Circuit Judge ROGERS.

ROGERS, Circuit Judge:

The Secretary of the Interior and others (“the Secretary”) appeal the preliminary injunction of March 15, 2004, which superseded and replaced an injunction of July 28, 2003, and required disconnection of substantially all of the Department of the Interior’s computer systems from the Internet. Cobell v. Norton, 310 F.Supp.2d 77 (D.D.C.2004) (“Cobell XI”). The injunction also requires the Secretary to submit a plan for secure reconnection of Interior’s computer systems. In Cobell v. Norton, 240 F.3d 1081 (D.C.Cir.2001) (“Cobell VI”), the court affirmed the district court’s finding of a breach of fiduciary duty by the Secretary of the Interior and the other defendants, as trustees of funds held in trust for individual Native Americans (hereafter, “Indians”), in failing to provide an accurate accounting. On remand, the district court entered several injunctive orders mandating Interior to disconnect its computers from the Internet in light of concerns about the security of individual Indian trust data (“IITD”), which are the basis for accounting for Indian funds and are housed on an unknown number of Interior’s computer systems. On appeal from the latest injunction entered March 15, 2004, the Secretary contends that the district court exceeded its lawful authority and, alternatively, lacked a factual predicate for the injunction.

We hold, contrary to the Secretary’s contention, that issuance of the March 15, 2004 injunction is not precluded by Pub. L. 108-108, 117 Stat. 1241, 1263 (2003), which applies only to “historical accounting activities.” As the district court noted, “Interi- or’s present obligation to administer the trust presents sufficient grounds for finding that Plaintiffs will be irreparably injured.” Cobell XI, 310 F.Supp.2d at 96 n. 27. We further hold that the district court’s jurisdiction properly extends to se *254 curity of Interior’s information technology systems (“IT”) housing or accessing IITD, because the Secretary, as a fiduciary, is required to maintain and preserve IITD. We nevertheless vacate the injunction because the district court erred by placing the burden of persuasion upon the Secretary, disregarding Interior’s certifications on the state of IT security, and failing to hold an evidentiary hearing prior to entering the injunction.

I.

The underlying litigation concerns individual Indian money accounts (“IIM”), which collectively form a trust established by the General Allotment Act in 1887 for the benefit of American Indians. 1 The trust corpus consists of the revenues derived from land that was carved out of preexisting Indian reservations under the 1887 Act. See generally Cobell VI, 240 F.3d at 1086-88. In 1994, after decades of mismanagement of the trust by the Interi- or and Treasury Departments, the Secretaries of 'which serve as trustees for the trust, Congress enacted the Indian Trust Fund Management Reform Act (“1994 Act”), Pub.L. No. 103-412, 108 Stat. 4239 (1994), which requires the Interior Secretary, among other things, to “provid[e] adequate systems for accounting for and reporting trust fund balances.” Cobell VI, 240 F.3d at 1089-90; 25 U.S.C. § 162a(d)(l). In 1999, the district court found a breach of fiduciary duty by the Secretary, and ruled that, pursuant to the 1994 Act, the Secretary must provide “an accurate accounting of all money in the IIM trust,” and establish written policies for the “computer and business systems architecture necessary” for an accurate accounting. Cobell v. Babbitt, 91 F.Supp.2d 1, 58 (D.D.C.1999) (“Cobell V”).

This court affirmed, although holding in Cobell VI that “the actual legal breach [by the Secretary] is the failure to provide an accounting, not failure to take the discrete individual steps that would facilitate an accounting.” 240 F.3d at 1106. Noting Interior’s stipulation that it was unable to meet the requirements of “numerous provisions” of the 1994 Act, the court observed, that “the federal government will be unable to provide an adequate accounting without computer systems, staffing, and document retention policies that are adequate for the task.” Id. The court also stated there was “no need to alter the district court’s order [in Cobell V]” because while:

[t]he level of oversight proposed by the district court may well be in excess of that countenanced in the typical delay case ... so too is the magnitude of government malfeasance and potential prejudice to the plaintiffs’ class....
... [Accordingly,] the [district] court should not abdicate its responsibility to ensure that its instructions are followed. This would seem particularly appropriate where, as here, there is a record of agency recalcitrance and resistance to the fulfillment of its legal duties.

Id. at 1109 (citing In re Center for Auto Safety, 793 F.2d 1346, 1354 (D.C.Cir.1986)). The court added: “[nonetheless, we expect the district court to be mindful of the limits of its jurisdiction.” Id. at 1110.

On remand, as relevant here, the district court, in light of the Special Master’s recommendation regarding inadequate IT security of IITD, granted the plaintiffs’ *255 motion for a temporary restraining order on December 5, 2001, requiring Interior “immediately [to] disconnect from the Internet” its IT systems housing or accessing IITD. See Cobell v. Norton, 274 F.Supp.2d 111, 113 (D.D.C.2003) (“Cobell IX”). The plaintiff also moved for a preliminary injunction and an order to show cause why the Secretary and counsel for the Secretary should not be held in contempt. With the consent of Interior, the district court on December 17, 2001, entered a Consent Order providing that “Interior shall not reconnect any information technology system to the Internet without the concurrence of the Special Master,” and “the Special Master shall verify compliance with this Consent Order....” Id. at 114. The relationship between the Special Master and Interior in carrying out the Consent Order apparently operated effectively, with almost 95 percent of Interior IT systems being reconnected within one year, Cobell XI, 310 F.Supp.2d at 82, until April 2003, when the Special Master and his contractor attempted to recheck whether computers recently found vulnerable were secure against unauthorized Internet access, id. The Special Master suspected that an Interior employee had frustrated the “penetration” of the vulnerable computers by providing advance warning to the computer administrator. Cobell IX, 274 F.Supp.2d at 114-24. This dispute escalated and resulted in the breakdown of the relationship between the Special Master and Interior and its attorneys from the Justice Department. See generally id.

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Bluebook (online)
391 F.3d 251, 364 U.S. App. D.C. 2, 2004 U.S. App. LEXIS 25142, 2004 WL 2753197, Counsel Stack Legal Research, https://law.counselstack.com/opinion/cobell-elouise-v-norton-gale-cadc-2004.