Cobell v. Salazar

United States Court of Appeals
FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued February 16, 2012 Decided May 22, 2012

No. 11-5205

ELOUISE PEPION COBELL, ET AL.,
APPELLEES

KIMBERLY CRAVEN,
APPELLANT

v.

KENNETH LEE SALAZAR,
SECRETARY OF THE INTERIOR, ET AL.,
APPELLEES

Appeal from the United States District Court
for the District of Columbia
(No. 1:96-cv-01285)

Theodore H. Frank argued the cause and filed the briefs
for appellant.

Anand V. Ramana was on the brief for amicus curiae
Competitive Enterprise Institute in support of appellant.

Thomas M. Bondy, Attorney, U.S. Department of Justice,
argued the cause for federal appellees. With him on the briefs
were Tony West, Assistant Attorney General, Ronald C.
Machen, Jr., U.S. Attorney, and Adam C. Jed and Brian P.
 2
Goldman, Attorneys. R. Craig Lawrence, Assistant U.S.
Attorney, entered an appearance.

Adam H. Charnes argued the cause for appellees Elouise
Pepion Cobell, et al. With him on the briefs were David C.
Smith, Richard D. Dietz, Michael Alexander Pearl, Keith M.
Harper, Dennis M. Gingold, William E. Dorris, and Elliott
Levitas.

Heidi A. Drobnick was on the brief for amicus curiae
Indian Land Tenure Foundation in support of appellees.

Before: ROGERS, TATEL and BROWN, Circuit Judges.

Opinion for the Court by Circuit Judge ROGERS.

ROGERS, Circuit Judge: This is an appeal from the
approval of a class action settlement agreement related to the
Secretary of the Interior’s breach of duty to account for funds
held in trust for individual Native Americans. Class member
Kimberly Craven challenges the fairness of the settlement,
contending principally that an impermissible intra-class
conflict permeates the scheme to compensate class members
for surrendering their established right to injunctive relief and
that this conflict undermines the commonality, cohesiveness,
and fairness required by Federal Rule of Civil Procedure 23
and due process. The record, however, fails to confirm either
the existence of the purported intra-class conflict or a
violation of due process. Rather, the record confirms that the
two plaintiff classes possess the necessary commonality and
adequate representation to warrant certification, and that the
district court, therefore, did not abuse its discretion in
certifying the two plaintiff classes in the settlement or in
approving the terms of the settlement as fair, reasonable, and
adequate pursuant to Rule 23(e). Accordingly, we affirm the
judgment approving the class settlement agreement.
 3
I.

In 1996, Eloise Cobell and four other Native Americans
filed a class action alleging a breach of fiduciary duties by the
Secretary in managing the class members’ “Individual Indian
Money” (“IIM”) trust accounts. “The bulk of the trust assets
‘are the proceeds of various transactions in land allotted to
individual Indians under the General Allotment Act of 1887,
known as the Dawes Act.’” Cobell v. Salazar (“Cobell
XXII”), 573 F.3d 808, 809 (D.C. Cir. 2009) (citation omitted).
The class, certified pursuant to Federal Rule of Civil
Procedure 23(b)(1)(A) and (b)(2), sought injunctive and
declaratory relief in the form of an historical accounting. Id.1
Their right to an historical accounting arose under the
American Indian Trust Fund Management Reform Act of
1994 (“the 1994 Act”), 25 U.S.C. § 162a et seq. (2006); id. §§
4001–4061. Cobell XXII, 573 F.3d at 810. The Act did not
specify, however, the proper scope of such an accounting or
the methodology by which it could be accomplished. Id. at
813; Cobell XX, 532 F. Supp. 2d at 42. During the initial
stages of the litigation, the Secretary proposed several plans
for accomplishing an accounting. See Cobell XX, 532 F.
Supp. 2d at 47–56. For example, in a 2002 report to
Congress, the Secretary described plans “to conduct a
transaction-by-transaction reconciliation of all funds in the
IIM accounts through December 31, 2000,” and to provide
historical statements of account for each account. Id. at 48.
The estimated cost was $2.425 billion. Id. Congress
“request[ed] that the Secretary ‘promptly consider ways to
reduce the costs and the length of time necessary for an

1
The background and the course of the litigation prior to the
proposed settlement agreement entered into on December 7, 2009, can
be found in Cobell v. Norton, 240 F.3d 1081, 1086–94 (D.C. Cir.
2001), and Cobell v. Kempthorne (“Cobell XX”), 532 F. Supp. 2d 37,
39–42 (D.D.C. 2008).
 4
accounting . . . [including] alternative accounting methods.’”
Id. The Secretary then developed a plan in 2003, which was
to rely on statistical sampling and use only limited
transaction-by-transaction reconciliation, at an estimated cost
of $335 million. Id. at 48–49. “Between 2003–2007,
however, not only did Interior receive only $127.1 million in
appropriations for its IIM historical accounting work, but it
also discovered that the accounting process it had envisioned
would be both more costly and more time-consuming than it
had anticipated.” Id. at 56. Consequently, as the litigation
entered its eleventh year, the issue of the proper scope and
methodology of an historical accounting had yet to be
resolved. In October 2007, the district court held a trial to
address these and other questions.

At trial, the Secretary offered evidence regarding the
latest plan (“the 2007 Plan”) for accomplishing an historical
accounting in compliance with the 1994 Act. The 2007 Plan
relied on statistical sampling for account and transaction
reconciliation to an even greater extent than the 2003 Plan. In
addition, the total number of transactions to be reconciled was
significantly reduced, and the provision of asset statements to
account beneficiaries was eliminated. See id. at 56–58. The
Secretary’s explanation for these changes to the scope and
methodology of the proposed accounting echoed those offered
in 2003 for tailoring the 2002 proposal: “Original cost and
time estimates were off by several multiples, and Congress
failed to appropriate the funds Interior had requested and
expected.” Id. at 58. The 2003 Plan was now estimated to
cost $1.675 billion to complete, with an average cost of
$3,000 to $3,500 for reconciliation of a single transaction. Id.
In contrast, the Secretary estimated completion of the 2007
Plan would cost $271 million. Id. at 81. Despite the reduced
ambitions of the 2007 Plan, the average cost of the accounting
for a single transaction still would likely exceed the average
value of that transaction, id. at 92, and, more significantly, the
 5
2007 Plan would “not provide beneficiaries with information
about the assets from which IIM funds ha[d] been derived,”
id. at 98.

Given this state of affairs and the likelihood of many
more years of litigation, the parties entered into settlement
negotiations in the summer of 2009. On December 7, 2009,
the parties entered into a class settlement agreement. See
Class Action Settlement Agreement, Ex. 2 to Joint Mot. for
Prelim. Approval of Settlement, Cobell v. Salazar (No. 1:96-
cv-01285) (Dec. 10, 2010). We describe its basic parts:

First, an amended complaint would be filed setting forth
two classes:
(1) the Historical Accounting Class, consisting of
individual beneficiaries who had an IIM account (with at least
one cash transaction) between October 25, 1994 (the date on
which the 1994 Act became law) and September 30, 2009 (the
“record date” of the parties’ agreement),2 id. § A ¶ 16, and
(2) the Trust Administration Class, consisting of the
beneficiaries3 who had IIM accounts between 1985 and the
date of the proposed amended complaint as well as
individuals who, as of September 30, 2009, “had a recorded or
other demonstrable ownership interest in land held in trust or
restricted status, regardless of the existence of an IIM

2
The Historical Accounting Class excluded individuals who,
prior to the filing of the original class action, filed actions on their own
behalf for accountings.
3
The Trust Administration Class excluded individuals who,
prior to the filing of the amended complaint on December 21, 2010,
filed actions on their own behalf for claims that would have otherwise
fallen under the claim release entered into by the Trust Administration
Class.
 6
[a]ccount and regardless of the proceeds, if any, generated
from the [l]and,” id. § A ¶ 35.

The settlement envisioned that the Historical Accounting
Class would be certified pursuant to Rule 23(b)(1)(A) and
23(b)(2), in the alternative, with no individual right to opt out
of the class; the Trust Administration Class would be certified
pursuant to Rule 23(b)(3) with an opt-out right. Id. § B ¶ 4.b.

Second, the Secretaries of Interior and Treasury would
deposit $1.412 billion into a settlement fund. Id. § E ¶ 2.a.
From this fund, each member of the Historical Accounting
Class would receive $1,000, id. § E ¶ 3.a, in exchange for the
release of the Secretary of Interior’s “obligation to perform a
historical accounting of [the class member’s] IIM Account or
any individual Indian trust asset,” id. § I ¶ 1. The Trust
Administration Class members would receive a baseline
payment of $500 plus an additional pro rata share of the
remaining settlement funds in accordance with an agreed-
upon compensation formula. Id. § E ¶ 4.b. The Trust
Administration Class payment would release the Secretary
from liability arising out of any past mismanagement of IIM
accounts and trust properties. The scope of that release would
not be unlimited: for example, claims for payment of existing
account balances, breach-of-trust claims arising after
September 30, 2009, and water-rights claims would fall
outside of its scope. Id. § I ¶¶ 2–3.

Third, in addition to the class and compensation structure,
the proposed settlement provided for:
(1) establishment of a $1.9 billion Trust Land
Consolidation Fund for the Secretary to acquire fractional
interests in trust lands, id. § A ¶ 36, § F ¶ 2, § G ¶ 2.c;
(2) establishment of an Indian Education Scholarship
Fund, id. § G ¶ 1;
 7
(3) potential tax-exempt status, at the election of
Congress, for funds received by the class members, see id.
§ H;
(4) reasonable attorneys' fees, expenses, and costs for
class counsel, to be awarded at the discretion of the district
court, id. § J; and,
(5) incentive payments for the class representatives, to be
awarded at the discretion of the district court, id. § K.

The proposal also stated that the class settlement agreement
was contingent upon the enactment of legislation by Congress
to authorize certain aspects of the settlement. Id. § B ¶ 1.

In 2010, Congress enacted the Claims Resolution Act of
2010 (“the CRA”), Pub. L. No. 111-291, 124 Stat. 3064 (Dec.
8, 2010), which “authorized, ratified, and confirmed” the
proposed settlement, id. § 101(c)(1). It also authorized the
district court to certify the Trust Administration Class without
regard to the requirements of the Federal Rules of Civil
Procedure, and provided that such a certification would be
treated as a certification pursuant to Rule 23(b)(3). Id.
§ 101(d)(2). The CRA appropriated funds including funds for
the settlement and land-consolidation funds. Id.
§ 101(e)(1)(C)(I), (j)(1)(A). Settlement funds received by
class members would be tax-exempt under the Internal
Revenue Code. Id. § 101(f). Congress also increased the total
amount of the settlement fund by $100 million, from $1.412
billion to $1.512 billion, id. § 101(j)(1)(A), resulting in
approximately a $300 increase in the baseline payment (from
$500 to $800) due members of the Trust Administration
Class.4

4
See Decl. of Michelle D. Herman at ¶¶ 38, 39, Cobell v.
Salazar (No. 1:96-cv-01285) (May 16, 2011).
 8
On December 10, 2010, the parties filed a joint motion for
preliminary approval of the class settlement agreement, which
the district court granted on December 21, 2010. The district
court also certified the Historical Accounting Class pursuant
to, in the alternative, Rule 23(b)(1)(A) and (b)(2), and the
Trust Administration Class pursuant to, in the alternative,
CRA § 101(d)(2) and Rule 23(b)(3). Appellant Kimberly
Craven and ninety-one other class members filed timely
objections. At a fairness hearing on June 20, 2011, the district
court heard testimony from objecting class members,
including Craven’s intra-class conflicts objections, along with
arguments in support of the settlement agreement by counsel
for the plaintiff class and the Secretary. At the close of the
hearing the district court explained why it concluded the
settlement was fair, reasonable, and adequate. We summarize
relevant parts.

To begin, the district court acknowledged the objectors’
concerns and that the settlement “may not be . . . as fortuitous
as some wished and do[es not] provide redress for their
wrongs.” Fairness Hr’g Tr. at 217. Nonetheless, the district
court explained that it was “not persuaded that striking a
different balance would have been either achievable in the
negotiating process or more favorable to more members of the
class,” id., nor “that a better result would have been achieved
by taking this case to trial,” id. at 218. First, the parties were
facing “years of litigation . . . with rather dubious chances of
ultimate success.” Id. at 213. They had “found a way out of
the morass that the Court of Appeals said [it] saw no easy exit
from,” and “after 15 years of bitter litigation [the parties had]
. . . entered into a settlement agreement to resolve the issues in
this case, . . . not to resolve every single claim that the Native
Americans may have against the government.” Id. at 214.
Second, “[t]his settlement at least now provides some measure
of certainty for most class members,” whereby “[t]he vast
majority of class members are entitled to automatic recovery
 9
under the historical accounting, and . . . those under the trust
accounting would [be] provide[d] other monies that they can
show they are due.” Id. at 217. The settlement does so,
moreover, in the absence of evidence of an intra-class conflict
among the Historical Accounting Class by providing a non-
damages payment of $1,000 to each class member. As for the
Trust Administration Class, it has the commonality,
numerosity, and typicality required by Rule 23. See id. at 233.
Third, the settlement is reasonable and adequate because it
“affords substantial benefits,” with “a total settlement of $3.4
billion.” Id. at 235. Obtaining Congressional approval and
avoiding Presidential disapproval of the settlement was, the
district court observed, “a remarkable accomplishment by all
sides.” Id. at 215.

By order of July 27, 2011, the district court granted final
approval to the class settlement agreement that the lawsuit be
settled and that the United States pay $3.412 billion — $1.512
billion to the settlement fund and $1.9 billion to the land-
consolidation fund — in accordance with the terms of the
settlement agreement and the CRA. Among other actions, the
order set forth the scope of the two plaintiff classes and their
respective claim releases, listed the individuals who had
chosen to opt out of the Trust Administration Class, and
awarded attorneys’ fees and incentive payments to the
remaining class representatives, while denying most requested
additional expenses.5 A final judgment was signed and
entered August 4, 2011. Craven appeals the judgment and
related orders.

5
Plaintiffs’ attorneys were awarded $99 million in fees.
Eloise Cobell, James Louis LaRose, Penny Cleghorn, and Thomas
Maulson — the class representatives — were awarded incentive
payments respectively of $2 million (inclusive of her expenses),
$200,000, $150,000, and $150,000.
 10

II.

A.
As an initial matter, Craven contends that the law of the case
bars approval of the settlement agreement. She points to
Cobell XXII, where this court vacated the judgment in favor of
the plaintiff class and the order of a restitution award, holding
that such an award would be arbitrary, inaccurate, and unfair
to some class members in the absence of an historical
accounting, 573 F.3d at 813. A lump-sum award, whose
magnitude was of uncertain origin, the court stated, was an
improper equitable judgment for the class’s claim; “without an
accounting, it is impossible to know who is owed what,” and
so “[t]he best any trust beneficiary could hope for would be a
government check in an arbitrary amount.” Id. Although
Cobell XXII did address the issue of a remedy for the
historical-accounting claim, the law-of-the-case doctrine has
no application here.

Under the law-of-the-case doctrine, “the same issue
presented a second time in the same case in the same court
should lead to the same result.” LaShawn A. v. Barry, 87 F.3d
1389, 1393 (D.C. Cir. 1996) (en banc) (emphasis in original).
Cobell XXII involved the same case, the same court, and the
same parties as the current appeal, but the court’s holding
arose in a different context at an earlier stage of the litigation
and the statements with regard to its holding spoke to a
different issue — one that did not involve the terms of the
class settlement agreement now under review. The court did
not address, nor could it given the stage of the proceedings, the
propriety or fairness of a two-class settlement involving pro
rata as well as per capita payments. The distribution method
for the lump-sum award had not yet been determined and so
could not have been at issue in Cobell XXII, see Cobell v.
Kempthorne (“Cobell XXI”), 569 F. Supp. 2d 223, 253 (D.D.C.
 11
2008). Furthermore, the factors that guided the exercise of the
district court’s equitable power in addressing the claims for
injunctive and declaratory relief under review in Cobell XXII,
are distinct from those that govern the district court’s approval
of a settlement. Compare Cobell XXII, 573 F.3d at 813
(discussing the interplay of the 1994 Act and equitable
principles in determining scope of an historical accounting)
with FED. R. CIV. P. 23(e) (setting the procedure for approving
a class settlement).

The class settlement agreement was the result of
discussions post-dating Cobell XXII in which the parties,
facing nigh insurmountable obstacles to achieving their
original goal, decided to pursue another approach to resolving
their protracted differences. Given the distinction between
Cobell XXII and the current appeal, the law of the case does
not foreclose approval of the class settlement agreement. To
the extent Craven suggests that the lawsuit could be settled
only for some type of historical accounting but not for
monetary relief, her contention fails, see infra Part II.B; to the
extent she contests the fairness of the distribution scheme, her
contentions also fail, see infra Part II.C.

B.
Craven contends with respect to the Historical Accounting
Class that “a mandatory [Rule] 23(b)(2) class settlement
without [an] opt-out right is inappropriate where relief is
predominantly monetary, especially when individual class
members are required to waive rights to injunctive relief
already won in litigation.” Appellant’s Br. at 28
(capitalization removed). This argument mischaracterizes the
Historical Accounting Class.

Rule 23(b)(2) provides for class certification where “the
party opposing the class has acted or refused to act on grounds
that apply generally to the class, so that final injunctive relief
 12
. . . is appropriate respecting the class as a whole.” FED. R.
CIV. P. 23(b)(2). Just such a circumstance presents itself here:
the Secretary refused to provide an historical accounting to
IIM account holders; their claim for injunctive and declaratory
relief in Count I of the amended complaint applied to the
Historical Accounting Class as a whole.

Craven disagrees. The $1,000 per capita settlement
payment, she maintains, monetizes the historical-accounting
claims so that what was a uniform, indivisible remedy
becomes divisible and individualized, and therefore
certification of the Historical Accounting Class pursuant to
Rule 23(b)(2) is precluded by Wal-Mart Stores, Inc. v. Dukes,
131 S. Ct. 2541, 2557–58, 2560 (2011). This is so, Craven
says, because the historical accounting has greater value to
class members with significant trust-mismanagement claims,
who may use the information from the accounting to obtain
substantial monetary relief, than to those with negligible trust-
mismanagement claims for whom the accounting may provide
little or no benefit. In other words, because some plaintiffs
stand to gain more from claims based on the information an
historical accounting would produce, the injunctive relief
sought is worth more to them than it is to other class members.

Assuming that the $1,000 per capita settlement payment
monetized the requested injunctive relief, certification of the
Historical Accounting Class as a Rule 23(b)(2) class was
nonetheless appropriate because of the unusual circumstances
surrounding this litigation. Craven’s argument ignores that the
record developed through extensive and hard-fought litigation
indicates that the different interests she alleges likely do not
exist and that even if they do exist, they would not be revealed
by the type of sampling-heavy accounting that would almost
certainly occur if the plaintiff class prevailed in the litigation.
See Fairness Hr’g Tr. at 213, 218; Cobell XX, 532 F. Supp. 2d
at 56, 103. Interior had performed a fairly extensive
 13
accounting in the course of the litigation but found only minor
discrepancies. At trial, the district court observed that “one
permissible conclusion from the record would be that the
[Secretary] has not withheld any funds from plaintiffs’
accounts.” Cobell XXI, 569 F. Supp. 2d at 238. This court’s
decision in Cobell XXII placed significant limits on the
Secretary’s accounting duty, clarifying that Interior need only
provide “the best accounting possible . . . with the money that
Congress is willing to appropriate.” 573 F.3d at 813. Given
that any additional accounting funded by Congress would
likely rely heavily on statistical sampling, even if latent intra-
class conflicts did exist, they would be unlikely ever to be
discovered. All of this suggests that the information produced
from an historical accounting is not likely to be worth
significantly more to some class members than to others, and
thus the $1,000 settlement payment is properly viewed as non-
individualized and does not run afoul of Wal-Mart.6

Moreover, this case is extraordinary in that Congress not
only expressly authorized, ratified, and confirmed the
settlement, but also appropriated $3.4 billion to fund it.
Although Congress made no express findings about the
propriety of (b)(2) certification of the Historical Accounting
Class, given the lengthy litigation and the limited funds
available for further accounting, Congress’s judgment that
uniform payments would adequately compensate class

6
See McReynolds v. Merrill Lynch, Pierce, Fenner & Smith,
Inc., 672 F.3d 482, 490–92 (7th Cir. 2012) (citing FED. R. CIV. P.
23(b)(2), (c)(4); Allen v. Int’l Truck & Engine Corp., 358 F.3d 469,
472 (7th Cir. 2004) (citing Jefferson v. Ingersoll Int’l Inc., 195 F.3d
894, 898–99 (7th Cir. 1999))); Gooch v. Life Investors Ins. Co. of Am.,
672 F.3d 402, 433 (6th Cir. 2012); see also 2 ALBA CONTE &
HERBERT B. NEWBERG, NEWBERG ON CLASS ACTIONS § 4:14, at 105,
§ 4:20, at 145 (4th ed. 2002 & Supp. 2011).
 14
members for an accounting right that it created carries
significant weight and sets this case apart from others.

C.
Craven also contends that the Trust Administration
Class’s distribution scheme is unfair under Federal Rule of
Civil Procedure 23(e) “because it bears no relation to the
underlying claims and perversely undervalues the claims of
the most injured class members while providing windfalls to
class members who have suffered little or no injury.”
Appellant’s Br. at 23 (capitalization removed). Her challenge
rests again on an alleged intra-class conflict that arises from
the distribution scheme’s under- and over-compensation of
class members. Although disclaiming any suggestion that
Rule 23(e) fairness requires a perfect allocation of payments
among individual class members, see Appellant’s Br. at 25,
Craven nevertheless maintains that under the existing
distribution formula, some members of the Trust
Administration Class likely possess more valuable claims than
do others and therefore the per capita baseline payment under-
compensates the former while over-compensating the latter, an
inequity that the pro rata payment does not remedy. As the
district court found, however, the distribution scheme is fair,
Fairness Hr’g Tr. at 219, and “[i]t is hard to see how there
[c]ould be a better result,” id. at 218, because Craven offers no
persuasive evidence to support her claim of unfair
compensation. Absent such evidence, Craven’s intra-class
conflict contention cannot undermine the overall fairness of
the distribution scheme and she thus fails to demonstrate an
abuse of discretion by the district court. See Richards v. Delta
Air Lines, Inc., 453 F.3d 525, 530 (D.C. Cir. 2006); Pigford v.
Glickman, 206 F.3d 1212, 1216 (D.C. Cir. 2000).

1. The Secretary initially questioned Craven’s standing to
present this challenge because he understood her to claim only
injuries to third parties and not to herself. See Appellees’ Br.
 15
at 43 n.7. Craven’s declaration disposes of that conjecture; it
identifies how she is personally injured as a result of the
district court’s certification of both classes.7 Craven Decl. ¶¶
6–7, 11; see also 28 U.S.C. § 1653; Am. Library Ass’n v. FCC,
401 F.3d 489, 494 (D.C. Cir. 2005). Moreover, the
Secretary’s suggestion overlooks the fact that the two major
components of the settlement — the Historical Accounting
Class and the Trust Administration Class — are inextricably
intertwined. The historical accounting that the plaintiff class
sought — but which is taken away by the settlement — would
have provided evidence of the value of each class member’s
IIM account and thereby shown, among other things, whether
there was an intra-class conflict. The settlement agreement
makes the challenges unseverable. See Class Action
Settlement Agreement, § M ¶ 6. Craven thus has established a

7
By sworn declaration, submitted in response to the court’s
call for supplemental briefing on standing, Craven states that she is
“prejudiced by the settlement in multiple respects.” Craven Decl. ¶ 2.
Craven holds an interest in real property held in trust by the Secretary.
Id. at ¶¶ 3, 5. Under the class settlement agreement, she is, according
to the settlement administrator, entitled to a per capita payment of
approximately $1,800 and a pro rata payment of approximately $600.
Id. at ¶ 5. “Every dollar that the distribution formula provides to
overcompensate per capita recipients thus disadvantages the subclass
of class members like [Craven] who are entitled to pro rata
distributions.” Id. at ¶ 6. Craven further declares that her pro rata
distribution will be reduced as a result of incentive payments to the
class representatives. Id. Additionally, Craven states, and specifically
explains a basis for, her belief that she has “a meritorious claim for
trust mismanagement worth more than the approximately $2400 [she]
will receive in the settlement.” Id. at ¶ 7. In a similar fashion, she
supports her belief that she “may have other claims for trust
mismanagement” in connection with her real property that she is
“unaware of because [she has] not yet been able to exercise [her]
rights to a[n] historical accounting,” rights which were extinguished
by the settlement, id. at ¶ 11. See id. at ¶¶ 8–11.
 16
non-speculative basis for asserting an “injury in fact,” Lujan v.
Defenders of Wildlife, 504 U.S. 555, 560 (1992), that gives her
standing to challenge not only the certification of the
Historical Accounting and Trust Administration Classes but
also the fairness of the Trust Administration Class’s
distribution scheme. Any other conclusion would prove a
bitter irony for those who have lost their earned right to an
historical accounting under the 1994 Act. See Union Asset
Mgmt. Holding A.G. v. Dell, Inc., 2012 WL 375249, at *2 (5th
Cir. Feb 7, 2012) (citing Devlin v. Scardelletti, 536 U.S. 1, 6–7
(2002)); cf. In re Vitamins Antitrust Class Actions, 215 F. 3d
26, 28–29 (D.C. Cir. 2000).

2. Although Craven has standing to challenge the fairness
of the distribution scheme on the basis of the alleged intra-
class conflict, her contention fails on the merits. As an initial
matter, Craven’s discussion of a hypothetical conflict is an
inadequate basis for vacating the class settlement agreement.
See Eubanks v. Billington, 110 F.3d 87, 98 (D.C. Cir. 1997).
And her concrete examples fare no better. Craven references
congressional testimony (attached to a supplemental brief that
the district court struck as untimely, see infra Part II.E)
regarding the value of potential claims held by a particular
class member. Other evidence indicates that the class
member’s ancestor likely released his claim to oil and gas
royalties in exchange for a lump-sum payment from his tribe
when the tribal council, pursuant to a 1919 congressional
Indian Appropriations Act, asserted tribal mineral rights.8 See
also Cobell XX, 532 F. Supp. 2d at 95–97. Even assuming
those claims survived, that class member, like any other class

8
See HISTORICAL RESEARCH ASSOCS., MINERAL LEASING ON
ALLOTTED INDIAN LANDS: U.S. GEOLOGICAL SURVEY INVOLVEMENT
& HISTORICAL RECORDS ASSESSMENT 24–29 (2000) (labelled
“Privileged and Confidential,” but appearing in Pls.-Appellees’ public
appendix at 118–23).
 17
member who is allegedly under-compensated by the
distribution formula, could have opted out of the Trust
Administration Class; the record indicates the class member at
issue declined to do so.

Indeed, the existence of the opt-out alternative effectively
negates any inference that those who did not exercise that
option considered the settlement unfair. The district court,
although acknowledging the possibility that some class
members may not have read or fully understood the
settlement-notice documents, was satisfied that the opt-out
provision fulfilled its purpose of protecting objecting class
members, Fairness Hr’g Tr. at 225, finding that the “extensive
and extraordinary notice” procedures, id. at 230, ensured
“hundreds of thousands” of class members “knew about th[e]
settlement and understood what they were getting into and
approved it,” id. at 238. Craven does not suggest these
findings are clearly erroneous. See FED. R. CIV. P. 52; In re
Vitamins Antitrust Class Actions, 327 F.3d 1207, 1209 (D.C.
Cir. 2003).

Other portions of the record also contradict the inequity
Craven alleges. The historical-accounting records examined
thus far have revealed only minor errors in trust accounting.
In 2007, Interior reported that it successfully traced 94.7% of
over 47 million IIM transactions occurring between 1985 and
2007,9 “reflect[ing] the reality that, in the absence of some
kind of equitable evidentiary presumption in favor of the
plaintiffs, one permissible conclusion from the record would
be that the government has not withheld any funds from
plaintiffs’ accounts,” Cobell XXI, 569 F. Supp. 2d at 238.

9
See DEPT’T OF THE INTERIOR, OFFICE OF HISTORICAL TRUST
ACCOUNTING, DATA COMPLETENESS VALIDATION: INTERIM OVERALL
REPORT 28 (2007) (Pls.-Appellees’ App’x 194).
 18
Craven’s attempt to support her intra-class conflict attack
by turning, in her reply brief, to the accounting received by the
class representatives is not well taken. She maintains that,
prior to the settlement agreement, the class representatives
received historical accountings that showed their trust claims
to be of little value; their interests therefore were in conflict
with those of the rest of the class members who did not know
how they would fare under the distribution scheme. First, as
discussed, few if any class members are likely to have trust
claims of substantial value. Second, even assuming Craven is
properly responding to Plaintiffs-Appellees’ argument that
there is no conflict among unnamed class members, see Am.
Wildlands v. Kempthorne, 530 F.3d 991, 1001 (D.C. Cir.
2008), and that Craven could show that the distribution
scheme did over-compensate the class representatives, she has
still failed to present persuasive evidence of class members
who are under-compensated by the distribution scheme and
thus failed to demonstrate the alleged conflict. Craven’s
evidence also does not establish that the distribution scheme
over-compensates the class representatives. Only a partial
accounting of the class representatives’ IIM accounts was
performed in 2001, which revealed “small variances” in the
analyzed transactions. Cobell XX, 532 F. Supp. 2d at 50. The
class representatives thus stand in the same position as all
other class members — lacking the historical accounting to
which they are entitled under the 1994 Act and therefore
lacking accurate information from the Secretary of the value
of their claims.

Furthermore, as mentioned, the record indicates that any
feasible accounting would be unlikely to provide evidence of
the alleged intra-class conflict. Craven’s position leaves this
problem unaddressed, neglecting to account for the changed
circumstances during the fifteen years between the
commencement of this litigation and its settlement in 2011.
By the time the parties entered settlement negotiations
 19
following Cobell XXII, it had become clear that the Secretary
would be unable to perform an accounting of the IIM trust
under the 1994 Act with the degree of accuracy desired by the
plaintiff class. See Cobell XXII, 573 F.3d at 813–15; Cobell
XX, 532 F. Supp. 2d at 103. Trust records had been lost or
destroyed, Cobell XX, 532 F. Supp. 2d at 45–46, fractional
ownership rendered accounting difficult, see Cobell XXI, 569
F. Supp. 2d at 249, and changes to Interior’s trust-accounting
system had complicated accounting efforts, see Cobell XX,
532 F. Supp. 2d at 43–44; HISTORICAL RESEARCH ASSOCS.,
supra note 8, at 25 (Pls.-Appellees’ App’x 119). Preliminary
work had revealed that even a partially complete accounting
would be prohibitive in cost, see Cobell XX, 532 F. Supp. 2d at
81–82; the record was clear “on the tension between the
expense of an adequate accounting and congressional
unwillingness to fund such an enterprise,” id. at 103 n.21. In
view of these realities, this court in July 2009 instructed “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.” Cobell XXII,
573 F.3d at 811. This instruction underscored the reality that
the original goal of the litigation — a complete historical
accounting for each class member — would not be realized.
Instead, any historical accounting that would result from
continued litigation would likely be severely limited in scope,
heavily restrained by cost, and thus unlikely to reveal the
existence of — much less remedy — the intra-class conflict
Craven alleges.

Viewed, then, not in the hypothetical light cast by
Craven’s challenge, but in the actual light illuminating the
parties’ negotiations, the district court reasonably concluded
that the class settlement agreement offered a fair resolution of
the plaintiff classes’ claims free of impermissible intra-class
conflict.
 20

D.
Additionally, Craven challenges the certification of the
Trust Administration Class as inconsistent with constitutional
due process. She maintains that the commonality and
cohesiveness requirements of Rule 23 are of constitutional
magnitude inasmuch as they inform adequacy of
representation, which is a clear constitutional pre-requisite to
class certification. She relies on Phillips Petroleum Co. v.
Shutts, 472 U.S. 797, 811–12 (1985), involving claims for
money damages, as well as Hansberry v. Lee, 311 U.S. 32, 37
(1940), involving injunctive relief, and points to this court’s
acknowledgment of the due-process implications of adequate
representation in National Association for Mental Health, Inc.
v. Califano, 717 F.2d 1451, 1457 (D.C. Cir. 1983), and
Phillips v. Klassen, 502 F.2d 362, 366 (D.C. Cir. 1974).
Craven fails, however, to show that certification of the Trust
Administration Class violated due process.

Where money damages are sought, due process requires:
(1) adequate notice to the class; (2) an opportunity for class
members to be heard and participate; (3) the right of class
members to opt out; and (4) adequate representation by the
lead plaintiff(s). Phillips Petroleum, 472 U.S. at 811–12.
Given the district court’s findings regarding the extensive
notice of the proposed settlement that was provided to class
members, the opportunity for class members to present their
objections and participate in the fairness hearing, and the right
to opt out, Craven’s due-process objection boils down to a
challenge to the adequacy of class representation. As Craven
suggests, the adequate-representation element of due process
overlaps with Rule 23(a)’s requirement that “there are
questions of law or fact common to the class,” FED. R. CIV. P.
23(a)(2). See Amchem Prods., Inc. v. Windsor, 521 U.S. 591,
626 n.20 (1997). Under Rule 23(a), commonality requires that
plaintiffs advance a “common contention” that “must be of
 21
such a nature that it is capable of classwide resolution —
which means that determination of its truth or falsity will
resolve an issue that is central to the validity of each one of the
claims in one stroke.” Wal-Mart, 131 S. Ct. at 2551. The
Trust Administration Class satisfies this requirement.
Although Craven characterizes the Class as “sprawling” and
encompassing “dozens of wildly different theories of
liability,” Appellant’s Br. at 42, all of the class members’ trust
claims revolve around resolution of a single issue — the extent
of the Secretary’s fiduciary obligation as trustee of the IIM
accounts. To the extent Craven’s commonality objection rests
on the purported intra-class conflict between over- and under-
compensated class members, her contention fails for lack of
persuasive evidentiary support, see supra Part II.C.2.

Nor, as Craven maintains, did the district court’s award of
incentive payments to class representatives create an
impermissible conflict requiring decertification of either class.
To the extent Craven’s argument that the incentive awards
create an intra-class conflict hinges on the size of the incentive
awards, her brief focuses on the class representatives’ request,
not on the terms of the class settlement agreement, the district
court’s findings, or the district court’s actual award. Although
the district court acknowledged in ordering the incentive
payments that such awards “are routinely provided to
compensate named plaintiffs for the services they provide and
the risks they incur[] during the course of class-action
litigation,” Fairness Hr’g Tr. at 238, the class settlement
agreement provided no guarantee that the class representatives
would receive incentive payments; it left that decision and the
amount of any such payments to the discretion of the district
court. The Secretary’s opposition to the magnitude of the
class representatives’ proposed incentive payments
highlighted the uncertain status of such payments at the time
of the settlement. In describing Ms. Cobell’s singular,
selfless, and tireless investment of time, energy, and personal
 22
funds to ensure survival of the litigation as meriting an
incentive award, the district court found such contributions
undermined any attempt to imply that Ms. Cobell had
improperly colluded with the Secretary to settle prematurely in
order to collect a fee. See id. at 239. It also denied altogether
the class representatives’ request for expenses incurred prior to
December 7, 2009 (the date of the settlement agreement),
finding that, with the exception of Ms. Cobell, they had failed
to show directly-incurred expenses; with regard to Ms. Cobell,
her expenses were incorporated into her incentive payment.

Craven thus fails to show either an error of law or clear
factual error in the district court’s due-process analysis.

E.
Craven’s other challenges also fail. First, the district
court’s reference to the small number of objectors was one of
many observations, not a dispositive finding in its fairness
analysis amounting to legal error. Nothing in the district
court’s observation was inconsistent with the caution that
should be exercised in “inferring support from a small number
of objectors to a sophisticated settlement,” In re Gen. Motors
Corp. Pick-Up Truck Fuel Tank Prods. Liab. Litig., 55 F.3d
768, 812 (3d Cir. 1995). See also In re Gen. Motors Corp.
Engine Interchange Litig., 594 F.2d 1106, 1137 (7th Cir.
1979).

Second, Craven fails to show that any prejudice resulted
from the district court’s striking of her supplemental brief as
untimely, so the error, if any, was harmless. See Burkhart v
Wash. Metro. Area Transit Auth., 112 F.3d 1207, 1214 (D.C.
Cir. 1997). The district court allowed Craven’s counsel to
present those arguments at the fairness hearing. See Fairness
Hr’g Tr. at 77–78. Even now Craven fails to identify any
argument in her supplemental brief that was not presented to
the district court.
 23
Finally, Craven’s general objection to the fairness of the
class settlement agreement focuses on the information-deficit
concern discussed previously: without an historical
accounting, it is impossible to tell whether some members are
being over-compensated while others are being under-
compensated, and yet class members are being forced to
surrender their right to an historical accounting and are
thereby left without the information needed to establish the
value of their claims. The protracted and contentious nature of
this litigation underscores the reasonableness of the district
court’s evaluation of the fairness and adequacy of the class
settlement agreement under Rule 23(e). Congress had shown
no inclination to fund the historical accounting to which the
plaintiff class was entitled under the 1994 Act. The question
was could the class nonetheless benefit appropriately without
it. Class counsel acknowledged that, despite significant work
with existing data, efforts had failed to show significant
accounting errors in the IIM accounts, see Cobell XXI, 569 F.
Supp. 2d at 238. The class settlement agreement was the
result of an arms-length negotiation. What interests it
protected and what benefits it provided were weighed by the
district court, and considered in view of the class-member
objections. The settlement acknowledged the plaintiff class’
entitlement to an historical accounting and that the United
States would pay for the surrender of that right and for trust
claims in accordance with an agreed-upon formula. The
settlement further provided that the Secretary would attempt to
purchase fractional ownership shares to enable accurate
accounting in the future in fulfilment of the Secretary’s trust
responsibilities. Congress has approved the settlement and
appropriated the necessary funds. For Craven to characterize
the settlement as “tak[ing] shortcuts to solve the problem at
the expense of individual rights,” Appellant’s Br. at 13, and
“tak[ing] a series of impermissible shortcuts that abuse the
class action process to settle this case,” id. at 15, is to ignore
 24
the history of this hard-fought litigation and the obstacles to
producing an historical accounting.

Accordingly, we hold that in approving the class
settlement agreement pursuant to Rule 23(e) the district court
did not abuse its discretion in focusing on the significant
benefits for each class member in view of the realities facing
them after fifteen years of litigation, including multiple
appeals, and we affirm the judgment certifying the two
classes, approving the terms of the settlement, and
encompassing the provisions of the July 27, 2011 order.