UNITED STATES DISTRICT COURT FOR THE DISTRICT OF COLUMBIA ________________________________ ) MARILYN KEEPSEAGLE, et al., ) ) Plaintiffs, ) ) v. ) Civil Action No. 99-3119 (EGS) ) TOM VILSACK, Secretary, U.S. ) Department of Agriculture, ) ) Defendant. ) ________________________________)

MEMORANDUM OPINION

“On October 19, 2010, after nearly eleven years of litigation,

Plaintiffs Marilyn Keepseagle, Luther Crasco, Gene Cadotte,

Porter Holder, Keith Mandan, and Claryca Mandan, individually

and on behalf of all others similarly situated . . . and

Defendant Tom Vilsack, the Secretary of the U.S. Department of

Agriculture . . . entered into a Settlement Agreement . . . to

resolve Keepseagle v. Vilsack . . . a nationwide class action

lawsuit that allege[d] systemic racial discrimination in the

USDA’s Farm Loan Program during the period from 1981 through

1999.” Mem. in Supp. of Mot. for Prelim. Approval, ECF No. 571-1

at 1; see Settlement Agreement (“Agreement”), ECF No. 621-2.1 The

Agreement created a $680,000,000 fund, most of which was

1 The Agreement was modified in 2012 in a manner not relevant to the issues currently pending before the Court. For clarity, the Court refers throughout this Opinion to the version of the Agreement as modified. dedicated to providing compensation to class members who were

able to prove their claims in a non-Judicial Claims Process. See

Agreement ¶ VII.F (p. 13). The Agreement limited the length of

the claims process: Class members had 180 days from the

effective date of the Agreement to submit their claims. See id.

¶ II.B (p. 1), IX.A.1 (pp. 15–16).

In crafting the Agreement, the parties agreed to terms that

would govern the distribution of the fund in the event that

money was left over after the non-Judicial Claims Process was

completed. If that occurred, the Agreement required that “the

Claims Administrator shall direct any leftover funds to the Cy

Pres Fund.” Agreement ¶ IX.F.9 (p. 33) (emphasis added). The

Agreement also contained provisions detailing precisely how the

Cy Pres Fund must be distributed “for the benefit of Native

American farmers and ranchers.” Id. ¶¶ II.I (pp. 2–3), IX.F.9

(p. 33–34). This Court approved the Agreement after providing

notice to the class, receiving written comments, and holding a

fairness hearing. The objections the Court received to the

Agreement were unrelated to the cy pres issues now before the

Court. See Mot. for Final Approval, ECF No. 589 at 62–63; Kent

Objection, ECF No. 585-2 at 7–8; Givens Objection, ECF No. 585-4

at 19–20; Transcript of April 28, 2011 Fairness Hearing, ECF No.

609. No appeal was filed from the Court’s approval of the

Agreement.

2 Nearly three years later, Class Counsel notified the Court

that although the non-Judicial Claims Process had been

completed, approximately $380,000,000 remained unclaimed. See

Status Report, ECF No. 646 at 3. For some reason, far fewer

class members had filed claims than the parties expected, far

fewer had been successful on their claims, or both. Class

Counsel accordingly embarked on attempts to modify the Agreement

to address the far-larger-than-expected excess. The Agreement

itself allows its own modification “only with the written

agreement of the Parties and with the approval of the District

Court, upon such notice to the Class, if any, as the District

Court may require.” Agreement ¶ XIV (p. 49).

Class Counsel first proposed to the government a modification

of the Agreement that would have provided for an additional

distribution to members of the class, including successful

claimants as well as those whose claims were denied, but in

Class Counsel’s view required “further review.” Opp. to Mot. to

Remove at 4. The government strongly opposed any such

modification and threatened to seek reversion of the excess

funds if Class Counsel pursued such a modification unilaterally.

Faced with such a risk, along with the need for the government’s

consent to obtain a modification under the Agreement and the

less-than-clear path for obtaining such a modification

unilaterally, Class Counsel settled on an approach that would

3 maintain the cy pres nature of the funds, but modify the

procedures for their distribution.

On September 24, 2014, Class Counsel filed a proposed

modification of the Agreement, which the Department of

Agriculture does not oppose. See Mot. to Modify, ECF No. 709.

Most importantly, the modification would use the bulk of the Cy

Pres Fund to create a trust with a twenty-year life span, which

would distribute the funds to organizations that are deemed to

serve Native American farmers and ranchers. The idea being that

a longer time horizon for distribution, combined with the

creation of an independent and specialized entity for directing

the distribution, would more efficiently distribute the funds

than the existing cy pres provisions.

The government and Class Counsel have asked this Court to

approve the modification without directing notice to the Class

or holding a fairness hearing pursuant to Federal Rule of Civil

Procedure 23(e), on the grounds that the Rule is inapplicable

where a modification would not affect a class’s legal rights. On

December 2, 2014, the Court held a status hearing, in part to

discuss that issue. The Court began the status hearing by

permitting Ms. Keepseagle to speak. Ms. Keepseagle discussed her

opposition to Class Counsel’s proposed modification and her

support for a proposal under which the cy pres funds would

instead be distributed to members of the class. See Transcript

4 of Dec. 2, 2014 Hearing, ECF No. 756 at 5:12–8:5, 9:19–10:3. The

Court responded:

I’m not suggesting at all by any stretch of the imagination that the theory has legal support. I don’t know. But I very clearly heard [Ms. Keepseagle] tell me in her words very eloquently, as she is, that she wants relief from this judgment which sounds like a Rule 60(b) motion. So, the thought then is, what should the Court do at this juncture to enable her to develop her theory? I’m not going to lose sight of the fact that she’s without individual counsel, from what I can determine based on our brief discussion in open court.

Id. at 12:25–13:18. Accordingly, the Court held further

proceedings in abeyance, and granted Ms. Keepseagle time to

secure legal representation. See id. at 22:4–9.

On February 9, 2015, an attorney appeared on behalf of George

and Marilyn Keepseagle. See Notice of Appearance, ECF No. 755.

The Keepseagles subsequently indicated that they requested a

decision on two preliminary motions before any deadline for

filing a motion for relief from judgment. See Joint Status

Report, ECF No. 758 at 1. Although the government and Class

Counsel preferred to brief all motions simultaneously, the Court

granted the Keepseagles’s request to brief their preliminary

motions first. See Minute Order of February 24, 2015.

The Keepseagles filed their motions on March 13, 2015. The

first motion seeks a Court Order removing Porter Holder and

Claryca Mandan as class representatives. See Mem. in Supp. of

Mot. to Remove (“Mot. to Remove”), ECF No. 760-1. The second

5 motion seeks an Order compelling Class Counsel to produce

certain materials. See Mem. in Supp. of Mot. to Compel (“Mot. to

Compel”), ECF No. 759-1. Class Counsel filed oppositions to both

motions on March 20, 2015. See Opp. to Mot. to Remove, ECF No.

762; Opp. to Mot. to Compel, ECF No. 764. The government “takes

no position on the relief sought in the Keepseagles’ motions,”

but filed a brief indicating its disagreement with their

contention “that the cy pres fund belongs to the class.” Gov’t

Response, ECF No. 763 at 1 (quotation marks and alteration

omitted). The Keepseagles filed reply briefs in further support

of both motions on March 27, 2015. See Reply in Supp. of Mot. to

Compel., ECF No. 766; Reply in Supp. of Mot. to Remove, ECF No.

767. At the Court’s direction, the Keepseagles and Class Counsel

filed supplemental briefs on April 2, 2015. See Class Counsel’s

Suppl. Br., ECF No. 768; Keepseagles’s Suppl. Br., ECF No. 769.

Upon consideration of the motions, the responses and replies

thereto, the applicable law, and the entire record, the Court

DENIES the motions.2

2 The Court directed the parties to address whether the Keepseagles must move to intervene to obtain the relief they seek in these motions. See Minute Order of February 24, 2015. Although Class Counsel and the Keepseagles dispute whether George Keepseagle must intervene—he was once a class representative, but was removed for health reasons in 2006—they agree that Marilyn Keepseagle need not intervene because she remains a class representative. See Mot. to Remove at 11–12; Opp. to Mot. to Remove at 17. Because Marilyn Keepseagle’s

6 I. Motion for Removal of Class Representatives

The Keepseagles seek the removal of Porter Holder and Claryca

Mandan as class representatives on the basis that they are no

longer adequate representatives of the class. They argue that

Holder and Mandan have “abdicated their fiduciary duties” by

supporting Class Counsel’s proposal even though “a substantial

minority—and, in all likelihood a majority, of the class

members” oppose the proposal and because Holder and Mandan have

been proposed as potential trustees of the Trust to be created

by the modification, rendering their interests divergent from

those of the class. See Mot. to Remove at 2. Upon reviewing the

pleadings regarding this motion, the Court noted that the Order

requested by the Keepseagles seeks a post-judgment modification

of the class-certification order, which is arguably barred by

Federal Rule of Civil Procedure 23’s provision of authority to

“alter[] or amend[]” an “order that grants or denies class

certification” only “before final judgment.” Fed. R. Civ. P.

23(c)(1)(C) (emphasis added). Because neither party had

addressed the issue, the Court requested supplemental briefing.

See Minute Order of March 30, 2015.

status is undisputed, the Court need not address George Keepseagle’s status at this time.

7 A. The Court is Not Authorized to Remove Class Representatives After a Final Judgment Has Been Approved.

In their supplemental brief, Class Counsel asserted that post-

judgment modifications of class-certification orders are

permitted only when “the amendment will materially affect the

legal rights of the members of the class,” a circumstance not

present here because class members have no legal right to the Cy

Pres Fund and therefore would not have any rights altered by

modifying the method of its distribution. Class Counsel’s Suppl.

Br. at 2–3. The Keepseagles disagree, arguing that the Court

must reassess the adequacy of representation at all times, and

that the proposed modification will “bind” class members. See

Keepseagle Suppl. Br. at 6–7.3 The question is therefore whether,

3 The Keepseagles’s supplemental brief focused largely on an attempt to recharacterize their motion for removal of class representatives as one pursuant to Federal Rule of Civil Procedure 60(b). See id. at 1–6. On the same page of that brief, they recognize that they “did not explicitly cite to Rule 60(b) as the basis of this Court’s authority to grant the Motion to Remove,” yet assert without explanation that the motion to remove was “premised” on Rule 60(b). Id. at 2 & n.4. Rule 60, however, was not discussed as a basis for the motion to remove or reply in support thereof, nor were the very specific circumstances under which a Rule 60 motion may be granted discussed in either document. The Keepseagles’s attempt fundamentally to alter their motion in a supplemental brief is rejected. See Herbert v. Nat’l Acad. of Sciences,

(D.C. Cir. 1992) (describing the general rule that courts “refuse[] to entertain arguments raised for the first time in [a] reply brief” because of the court’s “dependence as an Article III court on the adversarial process for sharpening the issues for decision”). The Keepseagles, moreover, have indicated their intent to file a Rule 60 motion to seek modification of the Agreement. The Court will consider their Rule 60 arguments

8 when a class action has resulted in a final settlement that

resolves both liability and remedy issues, Rules 23(a)(4) and

23(c)(1)(C) permit the Court to modify the class certification

order in light of allegedly inadequate representation by a class

representative.

Both Rules make clear that the answer is “no,” at least where

post-judgment actions will not affect class members’ legal

rights. Rule 23(c)(1)(C), which provides district courts with

authority to modify a class-certification order “before final

judgment” implies a clear limitation—modification cannot come

after final judgment. Cf. Larionoff v. United States,

(D.C. Cir. 1976) (finding, in connection with a prior

version of the Rule which provided authority for modification

before a “decision on the merits,” that the Rule “‘implies, even

if it does not state expressly, that such a decision should be

made in advance of the ruling on the merits’”) (quoting Jimenez

v. Weinberger,

(7th Cir. 1975) (Stevens, J.)).

Indeed, two courts of appeals have found that Rule 23(c)(1)(C)

generally does not apply in post-settlement requests for

modification. See Jeff D v. Andrus,

, 758 (9th Cir.

1989) (finding Rule 23(c)(1)(C) “inapplicable” where the

district had previously “entered a final judgment in the form of

in connection with that motion, to which Class Counsel and the government will be able to respond.

9 an order approving the . . . Settlement Agreement”); Cox v.

Shah,

, at *7 (4th Cir. 1999) (same). The

Keepseagles’s request for removal of class representatives would

require modification of the class-certification order underlying

the judgment. See Order Preliminarily Approving Settlement, ECF

No. 577 at 2 (“The following individuals are approved as Class

Representatives: Gene Cadotte, Keith Mandan, Porter Holder,

Marilyn Keepseagle, and Claryca Mandan.”); Agreement ¶ II.F (p.

2) (listing Porter Holder and Claryca Mandan as “Class

Representatives”).

To be sure, as Class Counsel admitted, the bar on

modifications after “final judgment” is flexible: “Following a

determination of liability, for example, proceedings to define

the remedy may demonstrate the need to amend the class

definition or subdivide the class. In this setting the final

judgment concept is pragmatic. It is not the same as the concept

used for appeal purposes, but it should be flexible,

particularly in protracted litigation.” Fed. R. Civ. P.

23(c)(1)(C), Adv. Comm. Notes. The “final judgment” language was

inserted in 2003 in place of the phrase “decision on the

merits,” to ensure that a class certification order could be

modified after a liability finding but before the finalization

of the appropriate remedy. Id.; see also Wright & Miller,

Federal Practice and Procedure § 1785.4 (3d ed. 2014). This

10 flexibility regarding the finalization of a remedy, however,

does not apply here. The Agreement not only settled and

extinguished the class’s liability claims, but also provided

detailed resolution of the appropriate remedy, including precise

provisions requiring the transfer of all unclaimed funds at the

conclusion of the non-Judicial Claims Process to a Cy Pres Fund,

and requiring the distribution of the Cy Pres Fund pursuant to

cy pres procedures.

Rule 23(a)(4)’s adequacy-of-representation requirement is

similarly targeted at ensuring that class members who may be

bound by a judgment are properly represented in proceedings that

may bind them. The Rule requires that “the representative

parties will fairly and adequately protect the interests of the

class,” Fed. R. Civ. P. 23(a)(4), and “[b]asic consideration[s]

of fairness require that a court undertake a stringent and

continuing examination of the adequacy of representation by the

named class representatives at all stages of the litigation

where absent members will be bound by the court’s judgment.”

Nat’l Ass’n of Reg’l Med. Programs v. Mathews,

,

344–45 (D.C. Cir. 1976) (emphasis added). As the emphasized text

indicates, these concerns are tied to the res judicata effect of

any judgment on class members—a class-action judgment binds

absent class members, so if the class representatives are

inadequate, it would be unfair to allow the case to proceed as a

11 class action. See Amchem Prods., Inc. v. Windsor,

,

625–27 (1997).

The problem in this case is that the lawsuit is, for res

judicata purposes, over. See Keepseagle v. Vilsack, No. 99-3119,

(D.D.C. Nov. 7, 2014) (“the Great Plains

Claimants, with notice, have intentionally satisfied their legal

claims”); Chandler v. Bernanke,

(D.D.C.

2008) (“An agreement between the parties dismissing all claims

is the equivalent of a decision on the merits and thus claims

settled by agreement are barred by res judicata.”). Indeed, the

Agreement made clear that the Class’s claims would be dismissed

and “forever barred and precluded.” Agreement ¶¶ VI.A. (p. 11),

X (pp. 47–48). Accordingly, the res judicata interests that Rule

23(a)(4) is designed to protect have dissipated.

That is not to say that such interests never arise after a

final judgment is entered. Just as the final-judgment concept of

Rule 23(c)(1)(C) is pragmatic, so too are the concerns

underlying Rule 23(a)(4). The D.C. Circuit has found that

concerns regarding binding the legal rights of class members

continue to animate the adequacy requirement post-judgment. For

example, where a post-judgment order granted class counsel an

attorney-fee award to be paid by the class members out of the

funds they had received as damages, the Circuit found the

adequacy requirement implicated because the class

12 representative, an association that had entered into a retainer

agreement with class counsel under which the association would

pay a flat-fee that would be reimbursed from the ultimate class

award, had interests directly in conflict with those of the

class. Mathews, 551 F.2d at 344–45. Proceeding with that

judgment would have subjected class members to court-ordered

payment of attorney’s fees. See

Post-judgment adequacy

concerns may also arise when a class member’s legal rights under

a settlement are bargained away. See Twelve John Does v.

District of Columbia,

(D.C. Cir. 1997)

(assessing the adequacy of a representative where class counsel

sought to bargain away the right to enforce a consent decree

regarding living conditions in a District of Columbia jail in

exchange for an agreement to meet “certain staffing levels”).

As the Court has previously held, the class members in this

case have no legal right to the Cy Pres Fund. See Keepseagle,

, at *12–14. They agreed to—and did not appeal—a

final settlement that entirely extinguished their legal claims,

provided a framework for the distribution of damages, and

mandated that all excess funds be distributed pursuant to a cy

pres remedy. See

The process for distributing the Cy Pres

Fund is the sole target of Class Counsel’s pending motion for

modification, so the proposed modification would not implicate a

13 class member’s legal right.4 Unlike the class in Mathews, they

would not be subject to a judgment to be paid out of their own

pocket; rather, the Cy Pres Fund contains money that was

allocated to pay the damages claims of other class members who,

for whatever reason, were unsuccessful under the non-Judicial

4 The Court recognizes that the Keepseagles intend to argue in their motion for modification that the unclaimed funds are the property of the individual class members. See Reply in Supp. of Mot. to Remove at 4–5 n.5. This Court’s November 2014 Opinion held, in rejecting a request for intervention, that class members lacked standing to intervene because they had no legal or property interest in the Cy Pres Fund and therefore faced no imminent legal injury from Class Counsel’s proposed modification. See Keepseagle,

, at *11–14. The Keepseagles’s characterization of this holding as “dicta,” Reply in Supp. of Mot. to Remove at 5 n.5, is incorrect; the lack of a property interest was necessary to the Court’s holding that class members faced no imminent injury. The Keepseagles are free, of course, to argue that this conclusion was wrong. Their brief attempt to do so in connection with the pending motions, however, is unconvincing. Their citation to Klier v. Elf Atochem N. Am.,

(5th Cir. 2011) ignores what Klier actually held: That settlement proceeds belonged to a class where the settlement agreement did not provide for a cy pres remedy and permitted the reallocation of excess funds to compensate another subclass. See Keepseagle,

(noting that the Fifth Circuit also emphasized that it did not have “‘a case where the settlement agreement itself provide[d] that residual funds shall be distributed via cy pres,’ and . . . that ‘the relevant provisions’ of the Agreement ‘shape the property interest created by the Agreement’”) (quoting Klier,

). The recent Eighth Circuit decision, In re BankAmerica Corp. Securities Litig.,

(8th Cir. 2015), may well support an argument that the Court’s prior holding should be reconsidered—although the Eighth Circuit appears not to have been confronted with a settlement agreement that mandated that the settlement administrator direct all excess funds to a Cy Pres Fund—but the Keepseagles have not elaborated their reliance on that case, so the Court has no occasion to address it at this time.

14 Claims Process or did not participate in the process. And unlike

the class in Twelve John Does, no one is bargaining away any

legal right regarding the enforcement of the Agreement.

Accordingly, the Court does not have the authority to remove

class representatives at this stage of proceedings, where a

final judgment has been entered and the pending proposal for

modification of the Agreement does not implicate the legal

rights of class members. For that reason, the Court DENIES the

Keepseagles’s motion to remove.

B. Porter Holder and Claryca Mandan Remain Adequate Representatives.

Although the Court lacks the authority to remove class

representatives in the peculiar posture in which this motion

arises, even if the Court had such authority, removal of Holder

and Mandan would be inappropriate because they remain adequate

representatives. The adequacy requirement ensures that “the

named representative must not have antagonistic or conflicting

interests with the unnamed members of the class.” Twelve John

Does,

(quotation marks omitted). This is

necessary because “[a] class representative whose interests are

materially adverse to some of the class cannot be an adequate

representative for the whole class because in promoting her own

interests she may undercut the interests of other class

members.” Newberg on Class Actions § 3:54 (5th ed. 2014).

15 The Keepseagles argue that Holder and Mandan do not have the

same interests as those of the class because: (1) they support a

proposed modification that is opposed by many class members; and

(2) they have been proposed as trustees of the Trust to be

created by the proposed modification and stand to receive

compensation for that position. See Mot. to Remove at 2–4.5 Class

Counsel responds that Holder and Mandan have merely taken a

different strategic position than the Keepseagles, and that no

conflict of interest arises from their nomination as trustees

because they stand to gain even more from any proposal under

which the Cy Pres Fund would be distributed to successful class

members. See Opp. to Mot. to Remove at 8–15.

The Court agrees that class representatives do not become

inadequate merely because other class members disagree with

their strategic decisions. See Newberg on Class Actions § 3:65

5 The Keepseagles’s counsel repeatedly suggest, without providing any evidentiary support, that Holder and Mandan may have received some type of secret compensation in exchange for supporting Class Counsel’s motion for modification. See, e.g., Mot. to Remove at 4 n.3. They even go so far as to appear to imply that Class Counsel provided large class-representative awards to Holder and Mandan—in the 2011 settlement—as compensation for their support for the proposed modification—the need for which could not have been apparent in 2011. See Mot. to Remove at 9 & n.9; Reply in Supp. of Mot. to Remove at 19 n.21. The former allegations, which would be deeply concerning if true, are wholly unsupported by evidence; the latter implication defies logic. The Court recognizes the sincere and deep disagreement regarding these issues, but no party’s position is advanced by leveling wholly unsupported allegations.

16 (5th ed. 2014); Californians for Disability Rights, Inc. v. Cal.

Dep’t of Transp.,

(N.D. Cal. 2008) (“A

difference of opinion about the propriety of the specific relief

sought in a class action among potential class members is not

sufficient to defeat certification.”). The same is true when

portions of the class disagree with a proposed settlement. Cf.

Thomas v. Albright,

(D.C. Cir. 1998) (“a

settlement can be fair even though a significant portion of the

class and some of the named plaintiffs object to it”); Grant v.

Bethlehem Steel Corp.,

, 22–24 (2d Cir. 1987)

(approving class-action settlement, under standard that required

“that the class members’ interests were represented adequately,”

even though all class members who expressed an opinion on the

settlement opposed it). “Rule 23(a)(4) ensures that

representative parties will fairly and adequately protect the

interests of the entire class.” Council of & for the Blind v.

Regan,

(D.C. Cir. 1983) (emphasis added).

This may require consideration of the views of vocal class

members, but a class representative must also exercise judgment

as to the propriety and likelihood of success of any particular

course of action. Cf. Twelve John Does,

(rejecting a contention that class counsel was inadequate in

negotiating with the defendant regarding violations of a consent

decree for failing to seek “concessions not contained in the

17 consent decree”). A class representative’s support for a

particular course of action, then, must be judged not only

against the views of the class, but also against the strategic

calculations that factored into that support.

Although reasonable minds could—and clearly do—disagree on the

best approach in this case, there is ample reason for Holder and

Mandan to view Class Counsel’s proposal as the strategic

decision that is most in the Class’s interest. The fact remains

that the Agreement that was approved mandates, in provisions

neither objected to nor appealed from, that all leftover funds

be distributed by the Claims Administrator to the Cy Pres Fund

and that the Cy Pres Fund be distributed to Cy Pres

Beneficiaries. See Agreement ¶¶ II.I (pp. 2–3), IX.F.9 (p. 33–

34). In considering whether to propose any modification of the

Agreement, Holder and Mandan would have to review the limited

avenues for obtaining such a modification. One path lies with

the Agreement itself, which permits modification “only with the

written agreement of the Parties.”

¶ XIV (p. 49). Another

path arguably may lie with Federal Rule of Civil Procedure

60(b), which provides for relief from judgment under certain

narrow circumstances. After learning that the government would

not only withhold consent to a modification that provided

additional payments directly to class members, but would seek to

obtain reversion of the excess funds if Class Counsel sought

18 such a modification unilaterally, Holder and Mandan could

reasonably have decided that seeking supplemental payments was

not worth the risk. Their decision could be bolstered by the

uncertainty inherent in seeking a modification of the Agreement

under Federal Rule of Civil Procedure 60(b). See, e.g., In re

Black Farmers Discrimination Litig.,

, 199–

201 (D.D.C. 2013) (rejecting Rule 60 motion for modification of

a similar settlement agreement that resolved similar

discrimination claims raised by African-American farmers); In re

Black Farmers Discrimination Litig.,

, 3–5

(D.D.C. 2014) (same). Were such a motion pursued in lieu of the

agreed-upon modification and subsequently denied, the class

would be stuck with the deal it originally struck—resulting in a

large Cy Pres Fund to be distributed in an arguably inefficient

manner. Worse, the government might follow through with its

promise to seek reversion of the entire excess. Of course, a

class representative might also decide—as Ms. Keepseagle has

decided—that the risk of losing a Rule 60 motion is worthwhile,

and that the government is unlikely to obtain reversion of the

funds. But that is precisely the point; either strategic path

has its benefits and its risks. Weighing these benefits and

risks is the job of a class representative, and Holder and

Mandan cannot be faulted for reaching a reasonable conclusion

that differs from that reached by many class members.

19 The Court also finds that Holder and Mandan do not have a

conflict of interest that would render them inadequate

representatives. To be sure, Holder and Mandan have been

nominated as potential trustees of the Trust that Class Counsel

seeks to create to oversee the distribution of the Cy Pres Fund.

See Class Counsel’s Notice of Nominations, ECF No. 712 at 1, 2.

If confirmed to this position, they would be eligible to receive

up to $10,000 annually for as long as they served, although

their service would be subject to reappointment and limited to a

maximum possible term of ten years. See Proposed Trust

Agreement, ECF No. 709-3 at 7, 9. The Keepseagles argue that

this creates an incentive to support the modification because

Holder and Mandan stand to gain up to $100,000 and would be in a

position to direct the distribution of a significant Cy Pres

Fund.6 Class Counsel responds that if Holder and Mandan were

financially motivated, they would be much better served by

6 The Keepseagles’s attorneys also appear to challenge the qualifications of Holder and Mandan to serve as trustees. They imply that both are totally unqualified for the job: “Upon information and belief, neither Holder nor Mandan has ever served on a non-profit entity with a substantial endowment and neither has substantial experience with grants.” Mot. to Remove at 3. This is misleading. Clarcya Mandan has experience with various non-profit organizations. See Mandan Bio, ECF No. 712-8. Porter Holder, moreover, has served on the Council for Native American Farming and Ranching, which was created by the Agreement in this case to advise and oversee the Department of Agriculture regarding issues that affect Native American farmers and ranchers. See Holder Bio, ECF No. 712-5.

20 seeking supplemental payments directly to class members. See

Opp. to Mot. to Remove at 9.

Adequacy is not questioned whenever class representatives have

any divergence of views or interests; “not every potential

distinction between the proposed representative and other class

members will render the representative inadequate.” Newberg on

Class Actions § 3:58 (5th ed. 2014). “Only conflicts that are

fundamental to the suit and that go to the heart of the

litigation prevent a plaintiff from meeting the Rule 23(a)(4)

adequacy requirement.” Id. Holder and Mandan do not have such a

deep divergence of interests. For one, their nomination is

contingent on being approved by the Court, and would be subject

both to term limits and to their reappointment. See Proposed

Trust Agreement, ECF No. 709-3 at 7, 9. They would not be given

money for nothing; they would be required to serve as Trustees

and supervise what would surely be a complex distribution

process. Finally, and most importantly, Holder and Mandan are

successful claimants under the existing Agreement. If they were

to support a redistribution of the excess funds to the class as

a whole or to previously successful class members, they would be

among those who would directly benefit, without the need for

approval of a nomination, continued service, years of work, or

reappointment. Indeed, if the excess funds were distributed pro

rata to all those who successfully submitted claims, Holder and

21 Mandan would receive approximately $100,000 each, Opp. to Mot.

to Remove at 9—the maximum amount they could receive for serving

as trustees, which would come only if they served for ten years.

See Proposed Trust Agreement, ECF No. 709-3 at 7, 9.

Accordingly, Holder and Mandan may stand to benefit under the

proposed modification, but they would also directly benefit

under a proposal akin to the Keepseagles’s plan. It is thus not

a conflict of interest that is driving their support for Class

Counsel’s motion, but a difference of opinion regarding the best

strategy.

In their reply, the Keepseagles argue that Holder and Mandan

would not benefit from the Keepseagles’s forthcoming motion to

modify the Agreement because the Keepseagles intend to move for

supplemental distributions only to class members who

successfully prosecuted a claim under Track A of the Agreement,

and Holder and Mandan were Track B claimants. See Reply in Supp.

of Mot. to Remove at 18–20. This argument illustrates the

fundamental flaw in the Keepseagles’s motion. If the Court were

to grant the motion, and the Keepseagles were to propose the

modification they say they intend to file, it would render

Marilyn Keepseagle subject to removal as a class representative.

The Keepseagles seek to remove Holder and Mandan for supporting

a modification that would not directly benefit all class

members, yet intend to propose a modification that would

22 distribute the excess funds only to successful Track A

claimants. This would omit all successful Track B claimants, all

class members whose claims were denied during the non-Judicial

Claims Process, and all class members who did not participate in

the non-Judicial Claims Process. That, however, is not how class

representation works: Porter Holder, Claryca Mandan, and Marilyn

Keepseagle have divergent views on the strategic options

available to the Class in seeking potentially to modify the

Agreement they struck in 2011. Given the posture of this case,

the uncertain legal issues involved, and the seeming

impossibility of reaching a modification that would benefit all

class members equally, their divergent views are understandable

and reflect not a conflict of interest, but that they all

continue to serve as strong representatives of the class,

despite their disagreements about the best strategy going

forward.

Holder and Mandan thus find themselves in a position far

different from those of the inadequate class representatives

referenced by the Keepseagles. Many of the cases relied upon by

the Keepseagles addressed class representatives whose underlying

legal claims differed in material ways from those of the class.

See Rosario v. Rockefeller,

, 759 n.9 (1973) (class

representatives who were not subject to challenged practice were

not members of the class); Hall v. Beals,

(1969)

23 (same); Bailey v. Patterson,

, 32–33 (1962) (same).

There is no dispute that Holder and Mandan had identical

substantive claims against the Department of Agriculture. Other

cases relied upon by the Keepseagles established the proposition

that a class should not be represented by an individual who,

under the class’s allegations, herself engaged in the challenged

conduct. See Wagener v. Taylor,

(D.C. Cir.

1987) (employment-discrimination class that included managers

who allegedly participated in the discriminatory conduct against

lower-level employees who were also class members). There could

be no allegation that Holder or Mandan were involved in the

Department of Agriculture’s actions that gave rise to this

lawsuit.

Nor are Holder and Mandan anything like the self-dealing class

representatives of Eubank v. Pella Corp.,

(7th

Cir. 2014) and Mathews,

. Mathews found

inadequate a class representative that had fronted the costs of

class counsel’s representation of the class and sought a post-

judgment order directing other class members to reimburse those

costs out of the damages recovered in the underlying suit. 551

F.2d at 344–46. Holder and Mandan do not stand to take anything

from class members (even if they become trustees, the Cy Pres

Funds with which the Trust will operate are not the property of

class members, supra at 13–14 & n.4), and unlike the

24 representative in Mathews, they actually would stand to gain

from an alternative modification proposal. Eubank demonstrated a

severe conflict of interest, where a class representative was

the father-in-law of class counsel, class counsel was facing

significant financial difficulties, and the class representative

therefore had a strong incentive to support proposals that

financially benefited class counsel over the class itself. 753

F.3d at 721–24. No such situation has been alleged here.

Accordingly, even if the Court had the authority to consider the

adequacy of class representatives at this stage, the Court would

DENY the Keepseagles’s motion.

II. Motion to Compel

Between July 30, 2014 and August 26, 2014, Class Counsel held

“in-person informational meetings” in Tulsa, Oklahoma;

Albuquerque, New Mexico; Phoenix, Arizona; Rapid City, South

Dakota; Bismarck, North Dakota; Spokane, Washington; Billings,

Montana; and Raleigh, North Carolina. See Class Counsel’s Mem.

in Supp. of Mot. to Modify, ECF No. 709-1 at 24. They also held

conference calls on August 6, 2014; August 16, 2014; and August

20, 2014. See id. “Each of these meetings spanned an entire day,

while each call lasted three hours, and included presentations,

questions and answers, and remarks by Class Members and members

of the public.” Id. On behalf of Class Counsel, the Indigenous

Food & Agriculture Initiative of the University of Arkansas

25 School of Law compiled a summary report of the comments made

during these so-called listening sessions. See Listening Session

Report, ECF No. 709-6; Mot. to Compel at 3.

The Keepseagles would like access to the Indigenous Food &

Agriculture Initiative’s “notes and the other correspondence

from class members and others related to the Listening Sessions”

(“the Listening Session Materials”). Mot. to Compel at 5; see

also Reply in Supp. of Mot. to Compel at 2 (describing the

materials sought as “letters, faxes and e-mails sent to IFAI

and/or Class Counsel, and IFAI’s transcriptions of the Listening

Sessions”). They assert that these materials “are the best

evidence of class members’ goals and interests with respect to

the distribution of the cy pres funds” and that “[a]n Order

compelling the production of the Listening Sessions records will

permit the Keepseagles to demonstrate that a substantial

minority—if not a broad majority—of the class members oppose

Class Counsel’s proposed modification and instead support a

supplemental distribution of the cy pres funds to class

members.” Mot. to Compel at 4.

Although the motion clearly articulates what the Keepseagles

want, it does not clarify the legal basis for getting there.

This case settled years ago pursuant to the Agreement over which

the Court retained only narrow jurisdiction. The Keepseagles

have not invoked the civil-discovery rules of the Federal Rules

26 of Civil Procedure as a basis for their motion to compel, nor

have they relied upon any provision of the Agreement itself.

Finally, the Keepseagles have not relied upon authority

permitting the Court to grant limited discovery in support of a

Rule 60(b) motion.7 The Keepseagles rely on two sources for their

motion to compel: First, they assert that Class Counsel’s

professional obligations require them to provide the Keepseagles

with the Listening Session Materials. See Mot. to Compel at 5–6.

Second, they invoke a doctrine that permits an objector to a

class-action settlement to obtain discovery in support of her

objection. See id. at 7.8

7 Their motion argued that the discovery would be useful to their forthcoming Rule 60 motion, but did not tie that to any legal basis for granting the motion to compel. In any event, the circumstances under which discovery is allowed in support of a Rule 60 motion appear limited to those in which the discovery sought is directly relevant to proving the applicable basis for relief from judgment. See, e.g., Bowie v. Maddox,

(D.D.C. 2010) (discovery “to further develop . . . claims of fraud” may be permitted in support of a Rule 60(b)(3) motion where the plaintiff “demonstrates a colorable claim of fraud”). The level of class-member opposition to a competing motion for modification, by definition, is not relevant to any basis for relief from judgment under Rule 60—all of which speak to defects in or changed circumstances regarding the underlying judgment.

8 The motion to compel also contains conclusory and unexplained arguments that, to the extent they seek to establish additional bases for the motion, are rejected. First, the motion states that “[i]n addition to the Keepseagle[s]’s right under the Rules of Professional Conduct to files in Class Counsel and/or their agent’s possession, this Court has authority to compel Class Counsel to produce all such records.” Mot. to Compel at 6 (emphasis in original). To the extent this argument was intended

27 A. The Keepseagles Waived Their Professional Responsibility Argument.

The Keepseagles’s invocation of the Rules of Professional

Responsibility was based upon their assertion that Ms.

Keepseagle “possesses a traditional attorney-client relationship

with Class Counsel.” Mot. to Compel at 5. Pursuant to Rule

1.16(d) of the D.C. Rules of Professional Responsibility, such a

relationship requires that “[i]n connection with any termination

of representation, a lawyer shall take timely steps to the

extent reasonably practicable to protect a client’s interests,

such as . . . surrendering papers and property to which the

client is entitled.” The Keepseagles accordingly argue that they

“are entitled to prompt production of files relevant to their

case.” Mot. to Compel at 6. Class Counsel responded that the

Keepseagles fail to grapple with the differences between a class

to be distinct from the class-action-objector argument, it is wholly unexplained. The legal decision cited in the following sentence for the proposition that “district judges presiding over class actions are expected to give careful scrutiny to the terms of proposed settlements in order to make sure that class counsel are behaving as honest fiduciaries for the class as a whole” has nothing to do with a district court’s authority to grant a post-judgment motion to compel. See

(citing Uhl v. Thoroughbred Technology & Telecomms., Inc.,

, 985 (7th Cir. 2002)). Similarly, the final paragraph of the motion to compel invokes decisions regarding the Court’s authority to impose sanctions for misconduct, a situation wholly unrelated to compelling the production of documents. See id. at 16 (citing Clarke v. Washington Metropolitan Area Transit Auth.,

(D.D.C. 2012); Shepherd v. Am. Broad. Co.,

(D.C. Cir. 1995).

28 action and individual representation. Although Class Counsel

acknowledge their attorney-client obligations to the

Keepseagles, and agree to, “of course, turn over to the

Keepseagles materials that pertain to their claims,” Class

Counsel also note that they have “a fiduciary obligation to the

class apart from their attorney-client relationship with the

Keepseagles.” Opp. to Mot. to Compel at 5. They correctly state

that none of the authority cited by the Keepseagles establishes

a right to all files related to a class action—including

communications between the lawyer and other class members. See

Opp. to Mot. to Compel at 8–9 (distinguishing Cobell v. Norton,

(D.D.C. 2002) and In re Cmty. Bank of N. Va.,

(3d Cir. 2005) because the cases involved “alleged

ethical violations of lawyers other than class counsel” and did

not involve questions related to the return of client files)

(emphasis in original). Class Counsel also cited authority for

the proposition that its ethical obligations are different from

those of counsel for an individual. See Opp. to Mot. to Compel

at 5–9.

The Keepseagles have not provided the Court with any authority

supplying a basis for this Court to adjudicate an ethical

dispute involving the D.C. Rules of Professional Responsibility,

and the source of such authority is not clear. Cf. Shelvy v.

Wal-Mart Stores, East, No. 11-cv-9176,

, at *1

29 (N.D. Ill. Nov. 19, 2013) (expressing skepticism that a district

court would have jurisdiction over a motion to compel based

solely upon a similar rule of professional responsibility). The

Court need not address the issue, however, because the

Keepseagles abandoned the entire argument in their reply brief

by failing to respond to any of Class Counsel’s points regarding

the differences between individual and class representation and

the applicable rules of professional conduct. See generally

Reply in Supp. of Mot. to Compel., ECF No. 766. “‘Because the

[Keepseagles] failed to address these issues in [their] motion

and failed to respond to [Class Counsel’s] points in [their]

Reply, the Court will deem them abandoned.’” Coleman ex rel.

Bunn v. District of Columbia, No. 13-1456,

, at

*17 (D.D.C. Sept. 30, 2014) (quoting McGinnis v. District of

Columbia, No. 13-1254,

(D.D.C. Aug. 28,

2014) (alterations omitted)).

B. The Keepseagles Are Not Entitled to Objector Discovery of the Listening Session Materials.

The second basis invoked by the Keepseagles for their motion

to compel relates to discovery that may be granted to class-

action objectors. “Class members, including those who become

objectors, are entitled to some opportunity to review the record

of the case so as to inform their views about the value of the

certification motion, settlement, and/or fee request.” Newberg

30 on Class Actions § 13:32 (5th ed. 2014). Even so, “[c]lass

members who object to a class action settlement do not have an

absolute right to discovery.” In re Lorazepam & Clorazepate

Antitrust Litig.,

(D.D.C. 2001); see also In

re Cmty. Bank of N. Va., 418 F.3d at 316. The Manual for Complex

Litigation suggests that “[d]iscovery should be minimal and

conditioned on a showing of need.” Manual for Complex

Litigation, Fourth § 21.643; see also Newberg on Class Actions §

13:32 (5th ed. 2014) (“The touchstone for discovery is that it

will ultimately assist the court in determining the fairness of

the settlement.”). As another Judge of this Court put it: “[T]he

Court may in its discretion allow discovery if it will help the

Court determine whether the settlement is fair, reasonable, and

adequate.” In re Lorazepam & Clorazepate Antitrust Litig.,

(emphasis added); see also, e.g., Wal-Mart Stores,

Inc. v. Visa, USA, Inc.,

(2d Cir. 2005) (if

“the District Court had before it sufficient facts intelligently

to approve the settlement offer,” there would be “no reason . .

. to give appellants authority to renew discovery.”); In re

Cmty. Bank of N. Va., 418 F.3d at 316 (“The District Court has

discretion to employ the procedures that it perceives will best

permit it to evaluate the fairness of the settlement.”)

(quotation marks omitted); In re Prudential Ins. Co. Am. Sales

Practice Litig.,

(3d Cir. 1998) (“whether to

31 grant discovery is committed to the sound discretion of the

court”).

The Keepseagles justify their discovery request as “directly

relevant to the propriety of Class Counsel’s motion and the

issue of whether their motion is supported by a majority of the

members of the class they purport to represent,” and rightly

note the potential relevance of class-member opposition to the

Court’s consideration of a settlement. Mot. to Compel at 7.

Class Counsel oppose the request on the grounds that discovery

of the Listening Session Materials would not add anything

because all parties agree “that most class members who spoke at

the eleven Listening Sessions or otherwise contacted Class

Counsel prefer a supplemental distribution instead of the

proposed modification.” Opp. to Mot. to Compel at 2; see also

Class Counsel’s Mot. to Modify, ECF No. 709-1 at 25(“most Class

Members who spoke . . . expressed their preference that some or

all of the cy pres funds be distributed directly to Class

Members who filed claims”); Summary of Comments, ECF No. 709-6.

The Court largely agrees with Class Counsel that the discovery

sought by the Keepseagles would be duplicative of existing

stipulations. It is well established that discovery is not

warranted where the underlying factual issue is one to which all

parties stipulate. See, e.g., Jones v. ReliaStar Life Ins. Co.,

(8th Cir. 2010) (where plaintiff “emphasize[d]

32 that discovery should be allowed to explore [the defendant’s]

conflict of interest, but [the defendant] concede[d] that it was

both insurer and administrator of the plan, . . . discovery is

unnecessary to establish the existence of a conflict”); Estevez-

Yalcin v. Children’s Village,

(S.D.N.Y.

2004) (where a party “concedes that it did no background check

at all on [a particular individual], . . . further discovery on

that issue is unnecessary”); Med. Billing Consultants, Inc. v.

Intelligent Med. Objects, Inc., No. 1-cv-9148,

,

at *2 (N.D. Ill. Apr. 4, 2003) (“Discovery of these documents at

this point in the litigation is not necessary as defendants are

willing to concede the most important issue.”). The point the

Keepseagles intend to make—that class members expressed broad

opposition to Class Counsel’s proposal—has largely been

stipulated to. Indeed, the comments received by the Court—all of

which have been posted on the docket—also demonstrate strong

opposition by many class members.

To the extent the Keepseagles intend to object to the

modification based upon the precise number of individuals

opposed to it or the precise words used to describe their

opposition, Reply in Supp. of Mot. to Compel at 3–5, the Court

would be better served by receiving written and oral statements

from these individuals directly. Such statements would be far

more persuasive proof of the positions of class members than

33 comments made by a relatively small subset of the class nearly

one year ago, some of which may have been intended to be private

communications to Class Counsel. The Court, moreover, intends to

solicit such a broad and timely array of comments from the

class. Because the Court intends to receive such input—the true

best evidence of the class’s perspective on Class Counsel’s

motion and the Keepseagles’s forthcoming motion—and because the

materials the Keepseagles seek have been largely stipulated to,

the Court finds that the Keepseagles’s proposed discovery would

not assist the Court in determining “whether the settlement is

fair, reasonable, and adequate,” In re Lorazepam & Clorazepate

Antitrust Litig.,

, and therefore DENIES the

motion to compel.

III. Conclusion

For the foregoing reasons, the motions to remove class

representatives and to compel are DENIED. An appropriate Order

accompanies this Memorandum Opinion.

SO ORDERED.

Signed: Emmet G. Sullivan United States District Judge April 23, 2015

34