First Americans are last in line for lawsuit against USDA

Christine Graef
12/30/03

WASHINGTON - In the latest turn of events in a lawsuit against the U.S. Department of Agriculture, attorneys allege the department is turning up the heat by forcing accelerated payments and foreclosures on the farms and ranches of American Indians.

"This year we started to hear that Indians were being notified that the USDA is unwilling to renegotiate terms of loans and wanted payment promptly, accelerated payment or it would foreclose or seize other support such as tax refunds and farm subsidies," said Joseph M. Sellers, a partner at Washington's Cohen, Milstein, Hausfeld and Toll. "This is effectively a death warrant on these farmers and ranchers. It would result in bankruptcy."

Sellers is a lead counsel for a certified class action suit of American Indian farmers (Keepseagle v. Veneman No. 99-03119 D.D.C.) alleging the USDA has denied loans that they were qualified to receive or gave loans on less favorable terms than their white male counterparts. Others said they were subjected to delays or refused applications.

"We've had farmers and ranchers who have lost their farms, others left because they couldn't make money, giving up land that has been in the family for decades," said Sellers. "Every day that passes without movement these people risk loss."

The case was filed in October 1999 following the release of a Feb. 1997 study conducted by the department's Civil Rights Act Team (CRAT) revealing that minorities had less access to loans and at higher rates than their white male counterparts. At the same time, an ongoing series of studies by the department's Office of Inspector General concluded there was widespread discrimination in the department resulting from the dismantling of its Civil Rights Office in 1984 when the USDA lost funding and abandoned thousands of complaints.

In 1998 Congress enacted legislation to allow minority farmers and ranchers to bring claims against the department with a statute of limitations extending back to Jan. 1, 1981 to July 1, 1997. More than 19,000 American Indians from North Dakota, South Dakota, Montana, Oklahoma and other states are alleging unfair treatment by agricultural officials during the past 20 years.

"The case began with 838 clients who came forward," said Anu Varma, associate attorney at the firm. "It keeps growing and we're not certain how large it will get. There's never been an accurate report on the number of American Indian farmers."

A mission of the USDA is to financially aid farmers whose profits are often at the whim of frost, storms and droughts that cause economic uncertainty. These loans, used by most farmers in the country, are done through the department's Farm Service Agency.

A farmer seeking the loan must show that he or she was unable to get a loan from a private lender. He must apply to a county board comprised of neighbors who consider intangibles such as good character.

The attorneys, relying with elegant simplicity on the CRAT report, asked the courts to certify their clients as a class action in December 2001. That same month, USDA invoked a provision that let it ask the Court of Appeal to review the case and asked for a stay of the case until reviewed.

In October 2002, the Court of Appeals dismissed the request for an appeal and vacated the stay on proceedings.

At the end of last year, the plaintiff's attorneys approached USDA to schedule a trial but USDA wanted to have the case briefed and sent back to the Court of Appeals which would delay the day of reckoning.

In January 2003, Sellers filed for a status conference. The judge denied this, but asked for proposals from both sides to be submitted by early March.

"We filed for trial as fast as we could," said Sellers. "But the last action was when the judge asked for proposals. These have not yet been acted on."

Months later, Sellers discovered the USDA was pressuring Indian farmers for payments in what he said is a hope the Natives will abandon their suit against USDA. He filed briefs with the judge in June requesting an end to USDA's acceleration and seizing of payments.

"We filed to impress on the judge the effect of allowing more time to pass," said Sellers. "It's an injustice on our clients."

USDA responded to the briefs by saying that negotiating loans is up to the department's discretion. The firm learned that in a previous case when black farmers sued the USDA for the same indiscretions as the Indians alleged, the government had suspended foreclosure proceedings because it recognized the terms of the loans were being contested as inequitable. The attorneys also learned that in the 1990s a group of white farmers filed a claim against the USDA saying they were discriminated against. The case was dismissed, but not before the government again agreed to forbear on loans to everyone involved until the case was over.

USDA refused to do the same for us, said Sellers.

The attorneys have filed a new motion for a status conference again, a year after asking for the conference a first time.

"The combination of a government agency operation and a judiciary system overburdened has delayed this," said Sellers.

Last April, the agency hired its first assistant secretary of civil rights, attorney Vernon B. Parker. But despite the changes implemented under Secretary Dan Glickman, the attorneys say the USDA has not rectified the findings of its 1997 CRAT report.

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