D.C. Circuit Requires Interior to Make Accounting & Vacates Trial Court Order

The D.C. Circuit vacated and remanded back to Judge Robertson the Cobell litigation (opinion here). A key excerpt:

We now hold that the district court correctly held that the

1994 Act and Cobell VI required a full accounting, but erred in

holding that an accounting cannot be conducted because, in the

district court’s view, Congress will never appropriate the funds

necessary to conduct such an accounting. The statute gives the

plaintiff class a right to an accounting. Sitting in equity, the

district court has the authority to approve a plan that efficiently

uses limited government resources to achieve that goal. It is

within the power of the district court to order an accounting

without requiring Interior to perform analyses the costs of which

exceed the benefits payable to individual American Indians. It

would indeed be “nuts” to spend billions to recover millions.

Cobell XX, 532 F. Supp. 2d at 86. A court sitting in equity may

avoid reaching that absurdity.

We now hold that the district court correctly held that the 1994 Act and Cobell VI required a full accounting, but erred in holding that an accounting cannot be conducted because, in the district court’s view, Congress will never appropriate the funds necessary to conduct such an accounting. The statute gives the plaintiff class a right to an accounting. Sitting in equity, the district court has the authority to approve a plan that efficiently uses limited government resources to achieve that goal. It is within the power of the district court to order an accounting without requiring Interior to perform analyses the costs of which exceed the benefits payable to individual American Indians. It would indeed be “nuts” to spend billions to recover millions. Cobell XX, 532 F. Supp. 2d at 86. A court sitting in equity may avoid reaching that absurdity.

When we vacated the district court’s injunction for abuse of discretion, we noted in particular that the injunction “caused the cost . . . to rise by more than an order of magnitude, from $335 million over five years to more than $10 billion.” Id. at 1077. We then specifically approved the use of statistical sampling on the rationale that for some transactions, “the average cost of accounting, per transaction, would exceed the average value of the transactions.” Id. at 1078. We now take that reasoning a step further, and instruct the district court to use its equitable power to enforce the best accounting that Interior can provide, with the resources it receives, or expects to receive, from Congress. Therefore we vacate the district court’s orders and remand for proceedings consistent with this opinion.

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