WASHINGTON – Lawyers for the Indian plaintiffs in the Cobell settlement have taken to court to argue that the many millions they are scheduled to receive is too little, but they’ll take it if they can get it.

The settlement, which provides $1.5 billion to individual Indians to resolve the Interior Department’s mismanagement of their royalties for decades, outlines a cap of nearly $100 million to settle lawyers’ fees. It was negotiated by the Obama administration, and must be approved by U.S. District Court Judge Thomas Hogan to become reality.

Some Indians with a stake in the case have argued that the amount set aside for attorneys is far too great, especially considering that many class members – those who actually have suffered due to Interior’s negligence – would receive less than $2,000 under the plan.

But, according to court papers filed Dec. 14, the $100 million amount is less than half of what plaintiffs’ lawyers think they would be due under a previously planned arrangement.

“Class counsel have undertaken 15 years of highly contentious and difficult litigation against defendants, including an extraordinary 12 month legislative approval process,” the plaintiffs’ lawyers wrote. “In framing and prosecuting this case, they undertook substantial risk, litigated novel procedural, jurisdictional and substantive legal issues, and navigated through a series of unique appellate [decisions].”

In court papers, the lawyers said “fair compensation” would be much closer to $223 million – which would equate to a major chunk of the settlement, leaving far less for Indian beneficiaries.

The number represents the compensation from a contingency fee arrangement the plaintiffs’ lawyers planned before the agreement with the Obama administration was announced in December 2009.

The original arrangement called for 14.75 percent to go to lawyers. Since the total settlement is $3.4 billion, including money for Interior to buy back fractionated land interests, $223 million would be the amount due.

The plaintiffs “believed then, and continue to believe” the contingency fee agreement is consistent with controlling law, according to court papers.

Obama administration lawyers quickly filed a response, saying the plaintiffs’ filing was “defective and not in compliance with the letter or spirit of the Settlement Agreement that the parties jointly submitted on December 10, 2010, for the Court’s consideration and preliminary approval.”

The lawyers for the plaintiffs include lead attorney Dennis Gingold and Kilpatrick Stockton partner Keith Harper, a citizen of the Cherokee Nation of Oklahoma.

After some members of Congress argued that the fees should be reduced before ultimately granting approval for the settlement this fall, the Cobell lawyers made a strong case that they deserved the money.

Lead plaintiff Elouise Cobell also said the lawyers should receive a substantial payment, because if they didn’t, future lawyers may be dissuaded from taking on important Indian country cases.

In terms of money for Cobell, court papers said she should receive an incentive award of $2 million and three other named plaintiffs should receive between $150,000 and $200,000 as a bonus for their role.

Named plaintiffs will also seek reimbursement for expenses and costs of approximately $10.5 million in addition to the incentive award.

Government lawyers have insisted that plaintiffs’ lawyers not be paid more than $99.9 million for fees and expenses through the end of December 2009. They also agreed that Gingold and company could receive $12 million more for work performed since that date.

But the plaintiffs’ lawyers said the fee structure is “at odds with the executed fee agreements and controlling law.”

The lawyers said they intend to ask for $99.9 million in fees, so their arguments appear aimed at getting the presiding judge not to cut that amount. They have indicated that they will not appeal any award that amounts to between $50 million and $99.9 million.

The court will have the final say, and can provide more or less than the settlement indicates.

The argument for more money to lawyers was filed along with a joint motion for preliminary approval of the overall settlement. The motion was signed by Justice Department attorney Robert Kirschman Jr., Gingold,
and Harper.

On Dec. 21, the court granted preliminary approval, ordering the formal beneficiary notification period to begin in 30 days, on Jan. 20.

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