Smallwood v. Lynch

235 F. Supp. 3d 280, 2017 WL 398334, 2017 U.S. Dist. LEXIS 11915
CourtDistrict Court, District of Columbia
DecidedJanuary 30, 2017
DocketCivil Action No. 2016-0161
StatusPublished
Cited by3 cases

This text of 235 F. Supp. 3d 280 (Smallwood v. Lynch) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Smallwood v. Lynch, 235 F. Supp. 3d 280, 2017 WL 398334, 2017 U.S. Dist. LEXIS 11915 (D.D.C. 2017).

Opinion

MEMORANDUM OPINION

REGGIE B. WALTON, United States District Judge

The plaintiff, William H. Smallwood, Jr., filed his Class Action Complaint (“Compl”) against Loretta E. Lynch, the former Attorney General of the United States, and Tom Vilsack, the former Secretary of the United States Department of Agriculture (“USDA”), seeking declaratory and equitable relief under Section 706 of the Administrative Procedure Act (“APA”), 5 U.S.C. § 706 (2012), based on a settlement agreement between a class of Native American farmers and the USDA that was approved by another member of this Court, see Compl. ¶¶ 1-5, 70-78; see also Order on Plaintiffs’ Motion for Final Approval of Settlement, Motion for Approval of Class Representative Service Awards, and Motion for an Award of Attorneys’ Fees and Expenses, Keepseagle v. Vilsack, No. 99-3119 (D.D.C. Apr. 28, *282 2011). 2 Currently before the Court is the defendants’ Motion to Dismiss (“Defs,’ Mot.”) and the Plaintiffs Motion for Class Certification and Appointment of Class, Counsel (“Pl.’s Class Cert. Mot.”), Upon careful consideration of the parties’ submissions, 3 the Court concludes that it must grant the defendants’ motion to dismiss and thus deny the plaintiffs motion as moot.

I. BACKGROUND

A. The Original Keepseagle Settlement Agreement

On November 24, 1999, a class of Native American ranchers and farmers filed a • class action lawsuit against the USDA, alleging “unlawful and invidious discrimination ... in the [USDA’s] administration of the farm loan program.” Compl. ¶ 14; Judge Emmet G. Sullivan of this Court certified the case as a class action pursu-' ant to Federal Rule of Civil Procedure 23(b)(2). See Keepseagle v. Veneman, No. CIV.A.9903119EGS1712, 2001 WL 3467694, at *1 (D.D.C. Dec. 12, 2001). 4 The plaintiff, “a member of the Choctaw Nation of Oklahoma,” is a member of the Keepseagle class. Compl. ¶ 10.

In 2011, the parties in Keepseagle reached a class-wide settlement agreement, which Júdge Sullivan approved after holding a fairness hearing. See Order, Keepseagle v. Vilsack, No. 99-3119 (D.D.C. Apr. 28, 2011) (granting final approval .of the Settlement Agreement); Compl. ¶ 35. The Settlement Agreement “provided for a Total Compensation Fund of $680,000,000 drawn from the Judgment Fund, 31 U.S.C. § 1304 [ (2012) ].” Compl. ¶20. Class members could choose between two claim tracks to request a settlement award: “Track A Claimant[s] w[ere] eligible to receive a maximum .payment of $50,000, and [ ] Track B-Claimant[s] w[ere] eligible to receive a [maximum] payment of ... $250,000.” Id. ¶ 23. The plaintiff “received an award under the ... Settlement Agreement.” Id. ¶ 10.

The Settlement Agreement also contained a cy pres provision, which provided that “the Claims Administrator shall direct any leftover funds to the Cy Pres Fund. Class Counsel may then designate Cy Pres Beneficiaries to receive equal shares of the Cy Pres Fund.” Id. ¶ 29. The Settlement Agreement defined a “Cy Pres Beneficiary” as “any non-profit organization, other than a law firm, legal services entity, or educational institution, that has provided agricultural, business assistance, or advocacy services to Native American farmers between 1981 and the Execution Date [of the Settlement Agreement].” Id.

“As a condition of settlement, class counsel and USDA agreed that the Keep- *283 seagleclass members had to move for dismissal of the case, with prejudice to be effective on ... the date on which the court entered an order providing final approval of the Settlement Agreement,” id. ¶ 26, which occurred on April 28, 2011, id. ¶35. The class members had 180 days from “the date upon which an order providing final approval of the Settlement became non-appealable” to submit their claims, id. ¶ 26, which occurred on June 27, 2011, see Fed. R. App. P. 4(1)(B)(iii) (stating that a notice of appeal “may be filed by any party within 60 days after entry of the ... order appealed from if one of the parties is ... a United States officer or employee sued in an official capacity”); see also Keepseagle v. Vilsack, 307 F.R.D. 233, 238 (D.D.C. 2014) (“No appeal was filed from the Court’s approval of the Agreement”).

B. The Modified Settlement Agreement

In August 2013, Keepseagle class counsel informed Judge ■ Sullivan that $380,000,711.89 remained in úndisbursed settlement funds, Compl. ¶37, and “informed the court that they intended to propose a modification of the Settlement Agreement” to establish “a new foundation” because “some of the conditions for the cy pres distribution [were] impractical” due to the unanticipated larger amount of undisbursed funds, id. ¶¶ 38-39. Thereafter, the Choctaw Nation of Oklahoma and the Great Plains Nation filed motions to intervene in the Keepseagle action to object to the proposed modification, id ¶ 41, which Judge Sullivan denied in November 2014, id. ¶ 43; see also Keepseagle, 307 F.R.D. at 249 (denying the motions to intervene on the ground that the putative intervenors lacked standing).

Keepseagle class counsel, as well as class representative Marilyn Keepseagle, through separate counsel, filed motions to modify the Settlement Agreement. See Compl. ¶¶ 42, 45. Class counsel’s .motion “sought immediate distribution of 10% of the undistributed funds to entities meeting certain specified criteria, with the remaining undistributed funds to be,placed in trust.” Id ¶42. On the other hand, Ms. Keepseagle’s separate motion. sought “to either distribute the undisbursed funds pro rata to the successful Keepseagle claimants or alternatively to create a renewed claims process to distribute more of the money to individual class members.” Id ¶ 45. After a hearing, on the motions, Judge Sullivan denied class counsel’s initial motion to modify the Settlement Agreement and also Ms..-Keepseagle’s separate motion for modification, “and requested that the parties attempt to reach a compromise to address the enormous amount of undistributed settlement funds.” Id. 1148.

In December 2015, “class-counsel filed Plaintiffs’ Unopposed Motion to Modify the Settlement Agreement Cy Pres Provisions” (the “motion to -modify”). Id. ¶ 49. This motion to modify proposed that three class representatives “would each receive $100,000 for their service to the class; Prevailing Claimants under the Settlement Agreement would each receive an additional $18,500[;] the IRS would receive $2,775 on behalf of each Prevailing Claimant; and the remainder of the estimated $380,000,000 would be available for cy pres distribution.” Id ¶ 50. “Ten percent or $38 million would be distributed to unidentified non-profit groups purportedly serving Native American farmers and- ranchers prior to November 1, 2010,” id..and “[a] trust would be created and endowed with the remaining funds to be distributed over a period not to exceed twenty years,” id.

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Cite This Page — Counsel Stack

Bluebook (online)
235 F. Supp. 3d 280, 2017 WL 398334, 2017 U.S. Dist. LEXIS 11915, Counsel Stack Legal Research, https://law.counselstack.com/opinion/smallwood-v-lynch-dcd-2017.