A media campaign is under way to notify American Indians in Montana and Wyoming that they may be eligible for $1,000 or more from a settlement in the Cobell class action lawsuit.

The lawsuit alleged that the government mismanaged billions of dollars that individual Indians should have received in income from their trust lands.

“We have about 20,000 people in your area we need to reach,” said Tyler Tullis, an account assistant working with Desautel and Hege Communications of Washington, D.C.

The firm was appointed by a federal judge to get the word out to hundreds of thousands of Indians nationwide who may be eligible for a piece of a $1.5 billion fund set up within a settlement that totaled $3.4 billion.

Tullis said notices are already appearing in broadcast and print media in the area.

Most people qualified for settlement money have already received official notice by mail. Indians who get those formal notices don’t have to do anything to receive their award, providing a federal judge grants final approval of the settlement agreement. A fairness hearing is set for June 20 in U.S. District Court in Washington, D.C., and the judge will issue an order sometime after that.

People who do not get formal notices through the mail but believe they are included under the terms of the settlement must file a claim within 45 days of the judge’s final ruling. Claims can be filed now on the settlement website, www.IndianTrust.com, or by calling 800-961-6109, Tullis said.

Anyone who wants to opt out of the settlement and retain the right to file a separate lawsuit against the government must do so by April 20. Objections to the settlement agreement will also be accepted until that date. The website provides instructions.

According to Department of Interior estimates, 33,600 people in Montana could receive a total of about $87 million. Most people will get two checks adding up to about $1,800.

Settlement with Interior and the U.S. Treasury Department was reached in 2009 and Congress approved the agreement in December 2010.

The lawsuit was brought 14 years ago by Elouise Cobell, a Blackfeet from Browning, and three other plaintiffs from around the country charging the government with mishandling trust accounts.

Interior handles income from trust lands for about 500,000 individual Indians. Income can come from agricultural leases, oil and gas leases, coal mining and other sources. Each tribal member who owns interest in income-producing property has an Individual Indian Money (IIM) account.

Cobell and other named plaintiffs charged that government mismanagement of those accounts through multiple generations and had deprived Indians of billions of dollars in income.

The government did not admit any of the allegations, but agreed to settle the complex lawsuit that had dragged through federal court since 1996.

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The settlement included a $1.5 billion common fund to be distributed to members of the class, $1.9 billion to consolidate fractionated lands; and up to $60 million for a scholarship fund for Indian youth.

Fractionated lands are parcels owned by several individuals who may each own a tiny fraction of a trust property. The Bureau of Indian Affairs, which was responsible for trust lands at the time the lawsuit was filed, struggled unsuccessfully to keep track of fractionated interests that became smaller and more numerous each time one of the property owners died.

Through successive generations, fractionation rendered many of those property interests so small they are virtually worthless. Hundreds of people may own an interest in just a few acres of land. Development of some highly fractionated properties became nearly impossible because of the number of people involved in each transaction.

Money in the land consolidation fund will be used to purchase fractionated parcels from willing sellers at fair market value. These lands would be consolidated into each tribe’s land base.

As incentive for selling fractionated interests, a contribution will be made to the scholarship fund for each interest sold.

Those eligible for compensation from the $1.5 billion common fund fall into two classes. The first is the “Historical Accounting Class,” made up of individual Indians who had an IIM account or owned trust land between Oct. 25, 1994, and Sept. 30, 2009, and whose account had at least one cash transaction during that time.

Everyone in the Historical Accounting Class will receive $1,000. The money will be distributed shortly after the judge issues final approval of the settlement.

It will take longer for awards from the second of the two categories, the “Trust Administration Class.” This class includes people who had IIM accounts between 1985 and Sept. 30, 2009, or Indians who can establish an interest in trust land during that time.

Minimum compensation for people in this category is $500, but it can be a lot more depending on how much income comes into each account. The award will be based on the 10 highest-income years in an IIM account. Accounts earning up to $5,000 will get between $800 and $1,250. Accounts that saw between $75,000 and $750,000 in activity during the top 10 years could get awards of between $12,000 and $125,000.

Money for the Trust Administration Class will be distributed once it has been determined that substantially all members of the class have been identified and after individual payments have been calculated.

Most people with IIM accounts are members of both the Trust Administration and Historical Accounting classes and will receive payments from both.

The payments will not be taxed and will not be counted in determining eligibility for social service benefits including food stamps, SSI and Medicaid.

Lorna Thackeray can be reached at 657-1314 or lthackeray@billingsgazette.com.

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Lorna Thackeray can be reached at 657-1314 or lthackeray@billingsgazette.com