The Public Justice Foundation proudly salutes the six Finalists for the 2011 Trial Lawyer of the Year Award.  This year’s Finalists were chosen from a field of 15 outstanding teams whose socially significant legal accomplishments were extraordinary or precedent-setting and in the public interest. The finalists will be feted at our annual Gala and Awards Dinner on July 12 at the Plaza Hotel in New York City.   The winner of the 2011 Trial Lawyer of the Year Award will be announced at that event.  To order tickets or for more information, click here.

The 2011 Trial Lawyer of the Year Finalists are (in alphabetical order according to last name of the lead counsel): 

Holding Big Pharma Accountable for Harming Infants  

In the early 1980s, O’Neal, Jones & Feldman Pharmaceuticals was the largest distributor of generic drugs in the U.S.  One of its drugs, E-Ferol, a water-soluble vitamin E supplement manufactured by Carter-Glogau Laboratories, was designed to aid in preventing vision impairment in premature infants.  Over a brief, five-month period, hospitals administered E-Ferol—although, unbeknownst to them, it was not approved by the FDA.  Tragically, many of the infants given E-Ferol suffered serious health effects; some even died.
 
More than 25 years after killing or injuring hundreds of babies, the manufacturer and distributor of E-Ferol are finally being held accountable for their actions, thanks to lead counsel Art Brender of the Law Offices of Art Brender in Fort Worth, Texas; co-counsel Dwain Dent and Fred Streck of the Dent Law Firm in Fort Worth; and David Nix of Wichita Falls, Texas.  In a class action settlement achieved after seven years of challenging litigation in Klein v O’Neal, Inc., the insurers of Carter-Glogau and O’Neal have to pay $110 million to 369 people who are either surviving recipients of E-Ferol or surviving family members of infants who died.
 
E-Ferol’s initial appeal to doctors was its suitability for intravenous administration, a delivery method considered superior to the previously available oral application or injection of vitamin E for premature babies.  When questions arose about whether E-Ferol had obtained FDA approval, O’Neal sales staff were instructed to tell customers that it had.  (Earlier, O’Neal had intentionally marketed E-Ferol as a supplement, not a drug, so as to skirt the mandatory FDA approval.)  The first inquiry of concern came within 40 days of distribution; within several months of E-Ferol’s release, medical providers, the FDA, and the Centers for Disease Control and Prevention had became aware of a pattern of harmful symptoms in premature babies to whom the drug had been given.  These symptoms—which generally involved failure of the kidneys and liver—in many cases led to brain injury, blindness and/or death, and came to be known as “E-Ferol Syndrome.”  E-Ferol was permanently recalled in April, 1984, after less than six months on the market.
 
In 1987, three executives at the two companies were convicted of fraud, misbranding and selling an unapproved dangerous drug; the two companies’ presidents were both sentenced to almost a decade in prison.  (Those sentences were ultimately suspended to six months each.)  Shockingly, no testing was ever done by either Carter or O’Neal to determine whether E-Ferol would be a safe and effective drug for use in premature infants.  Though neither Carter-Glogau nor O’Neal is still in business (both were sold shortly after the E-Ferol scandal), their liability insurers are paying the settlement.
 
Despite the criminal convictions, this case was far from a slam dunk for the plaintiffs; it took years—and a huge amount of work.  To certify the case as a class action, Brender, Dent and Streck were faced with the enormous task of locating all of the E-Ferol recipients across the country; and, after locating 89 hospitals nationwide and a total of 369 patients who had received the drug, the attorneys then had to determine—using twenty-year-old hospital records—whether E-Ferol was a cause of death or injury in each of those cases.  This process was further complicated by the fact that the drug was administered to premature infants, many of whom had serious comorbid conditions that made it difficult to establish the harm caused by E-Ferol.
 
To obtain damages for the parents of the deceased infants, the attorneys also had to overcome the applicable two-year statute of limitations.  They did so by proving that the defendants—by deceiving doctors, hospitals, and other caregivers into believing that they had the proper research, testing, and approval of E-Ferol—had actually deceived the parents and were therefore guilty of fraudulent concealment, which tolls the statute of limitations.  Never before had a court held that an agency relationship such as the one between the parents and their children’s doctors could defeat a limitations defense through proof of fraudulent concealment.
 
The plaintiffs’ attorneys filed the class action lawsuit in May, 2003.  But Dent and Streck had already been working on this litigation for nearly two decades.  In 1985, they filed their first of twenty individual claims involving E-Ferol.  By the early 2000s, they had won a trial court decision granting them access to patient records at Fort Worth Children’s Hospital; on appeal, however, the lower court’s order was vacated.  Undaunted by this setback, Dent and Streck began pursuing a class action and recruited Art Brender to join them. 
 
In May, 2004, the attorneys obtained class certification.  But much work still lay ahead of them.  As they continued to seek records from the 89 hospitals that had administered E-Ferol, many hospitals were uncooperative.  Again unfazed, the attorneys took on litigation in a number of district courts throughout the country where hospitals had moved to quash subpoenas for records and deposition testimony.  Eventually, the lawyers litigated their way through the various hospitals’ motions to quash.  With the all-important medical records in hand, they established causation by reviewing over 400 sets of records comprising tens of thousands of pages, organizing the data, and conducting epidemiological studies.  Their experts helped them prove that the emulsifying agent known as polysorbate 80 (used to make oil-based vitamin E water soluble) was a primary cause of the drug’s harmful effects.  Plaintiffs showed that Carter and O’Neal’s carelessness and negligence had caused 43 deaths and left 24 infants brain damaged.
 
The $110 million settlement approved by a federal district court judge in Texas on April 9, 2010, finally brought justice and closure to many injured families.  For about twenty years, many parents did not know that E-Ferol had been given to their babies or that it was dangerous.  By exposing what really happened, at least now these parents know why their children became sick and/or died, and they can stop blaming themselves.  The case also makes it easier for other attorneys to hold Big Pharma accountable in personal injury class actions by providing a road map for obtaining class certification and establishing medical causation. 

Blowing the Whistle on Contaminated Drugs

GlaxoSmithKline (GSK), the British drug giant, has a feel-good message on its corporate website: “Do more, feel better, live longer.”  But in 2002, Cheryl Eckard, a former Quality Assurance Manager with GSK, learned of serious problems at the company’s plant in Cidra, Puerto Rico.  GSK had sent Ms. Eckard to Cidra to lead a team of 100 quality experts to fix problems cited in a warning letter from the U.S. Food and Drug Administration (FDA).  At the time, the Cidra facility was GSK’s No. 1 in the world: it was making over 20 products worth $5.5 billion annually, including the blockbuster drugs Avandia, Paxil and Coreg.  But Ms. Eckard soon discovered that quality control was a mess at Cidra.  She complained repeatedly to top company executives, recommending recalls of adulterated products.  GSK did nothing—other than fire her (and her husband) 9 months later as a “redundancy.”
 
Undaunted, Ms. Eckard took on the world’s fourth largest drug company in a whistleblower action—and succeeded, thanks to the tenacity and skill of co-lead counsel Neil V. Getnick and Leslie Ann Skillen, and co-counsel Margaret J. Finerty and Richard J. Dirks, all with Getnick & Getnick LLP in New York, N.Y., as well as Michael E. Getnick of Getnick Livingston Atkinson Gigliotti & Priore, LLP in Utica, N.Y., and Scott J. Tucker of Tucker, Heifetz & Saltzman, LLP in Boston, Mass.  After seven years of litigation and less than a week before trial, GSK agreed to pay the United States $750 million in a global resolution of criminal and civil complaints, including Ms. Eckard’s whistleblower suit.  The global settlement includes $150 million for criminal fines and $600 million in civil penalties.  Ms. Eckard’s share of the civil penalties was $96 million, the largest amount ever awarded to a single whistleblower.  This stunning achievement marked the first time that the federal whistleblower statute—the False Claims Act—had been used to hold a drug maker accountable for violations of manufacturing standards.
 
In 2004, Getnick and Skilling’s team filed suit in the federal district court in Massachusetts, representing Ms. Eckard on behalf of the federal and state governments under the False Claims Act.  That law allows a private citizen with knowledge of fraud on the government to sue on the government’s behalf and receive a share of any proceeds. 
 
The whistleblower suit detailed problems that Ms. Eckard had discovered at GSK’s Cidra plant: the water system was contaminated with microorganisms; the air system allowed for cross-contamination between products; the plant produced intravenous drugs for cancer that were not sterile; and pills of differing strengths were sometimes mixed in the same bottles.  The crux of the allegations was that GSK had defrauded the government by charging health care agencies for drugs that did not have the proper mix of ingredients or were otherwise contaminated.  This was the first whistleblower action to accuse a drug company of defrauding the government by selling products tainted in the manufacturing process.
 
The case presented a particularly thorny challenge because the Medicare and Medicaid statutes don’t speak to whether the government would pay for an adulterated product.  While it might seem obvious that the government wouldn’t do this, Ms. Eckard’s lawyers had to find a legal hook for that concept, which involved theories of first impression and a highly complex fact scenario that centered on drug quality systems and the science and technology of drug manufacturing.  All the while, Eckard’s counsel had to navigate the unique and complex tripartite nature of whistleblower actions—whistleblower, defendant, and government.
 
It was imperative that the trial team manage its civil case and prepare for trial without harming the government’s ongoing criminal investigation.  (As a result of Ms. Eckard’s complaints, the FDA had begun a criminal investigation and, in 2005, seized nearly $2 billion worth of drugs at the Cidra facility.  Unable to fix the plant, GSK shut it down in 2009.)  While simultaneously supporting the U.S. Attorney’s office, Getnick and Skilling’s team reviewed and analyzed more than 1.5 million pages of documents to prepare for trial. 
 
On October 26, 2010, less than a week before trial, the United States intervened in Ms. Eckard’s case and settled the suit and the pending criminal charges for $750 million.  In a nod to the outstanding work of Ms. Eckard’s lawyers, the government atypically did not substitute its own complaint when it officially intervened.  In addition to the $96 million awarded to Ms. Eckard
from the settlement of the civil claims, she will receive millions from the 50 states (which had also been defrauded and were part of the lawsuit).
 
As the first case in which a whistleblower held a pharmaceutical giant accountable for violating drug manufacturing standards, the case sends a powerful message to drug makers that cutting corners on drug quality will not be tolerated.  It also incentivizes other potential whistleblowers employed by drug makers to speak up when they see that the company is putting profits ahead of patient safety.  In short, the result reached in this case will help deter violations of drug safety standards that put patients at risk, because drug manufacturers now know that they are subject to the scrutiny of whistleblowers. 

Punishing Big Pharma’s Marketing Fraud

Dr. David Franklin used to be a sales representative for Parke-Davis, a subsidiary of pharmaceutical giant Warner-Lambert Co.  In 1996, when Dr. Franklin’s employer began pressuring him to market off-label uses of an epilepsy drug called Neurontin, he felt uncomfortable and retained a lawyer.  Meanwhile, Neurontin sales—94 percent of which were for off-label uses that were neither approved by the FDA nor effective for consumers—had risen to over $2 billion annually by 2002.  This was largely due to a massive marketing campaign conducted by Pfizer—the world’s biggest pharmaceutical company—which had acquired Warner-Lambert in 2000.  Dr. Franklin and his attorney brought a False Claims Act lawsuit against Warner-Lambers, which resulted in the company pleading guilty to two felony counts of misbranding Neurontin and Pfizer eventually paying $430 million in a global settlement of all civil and criminal claims.  But the story—and the role of Dr. Franklin’s lawyer—didn’t end there. 
 
After the announcement of the settlement, consumers and insurers filed hundreds of lawsuits against Pfizer alleging that they were duped into paying for useless Neurontin prescriptions.  These cases were consolidated by the Judicial Panel on Multi-district Litigation (MDL) and transferred to the federal district court in Massachusetts.  Dr. Franklin’s former attorney, Tom Greene of Greene LLP in Boston, Mass., became Chairman of the Plaintiffs’ Steering Committee.  After the court denied class certification, Greene and his co-lead counsel, Tom Sobol of Hagens, Berman, Sobol, Shapiro LLP in Cambridge, Mass., Don Barrett of the Barrett Law Office P.A. in Lexington, Miss., and Linda Nussbaum of Grant & Eisenhofer P.A. in New York, N.Y., with assistance from Ilyas Rona of Greene LLP and Kristen Johnson Parker of Hagens, Berman, Sobol, Shapiro LLP, took a “bellwether” case to trial instead: Kaiser Foundation Health Plan v. Pfizer.  Using a novel approach to hold Pfizer accountable under the federal racketeering law known as “RICO,” the trial team prevailed after a five-week jury trial:  the Oakland, Calif.-based health insurer was awarded over $142 million for Pfizer’s fraudulent marketing of Neurontin.
 
Kaiser, a health care giant that provides coverage for nearly 8.6 million families, claimed that Pfizer’s fraud led the insurer to pay roughly $500 million for Neurontin that was inappropriately prescribed to its customers.  Kaiser had sued Pfizer under both the Racketeer Influenced and Corrupt Organizations Act (RICO) and the California Unfair Competition Law (UCL).  The odds were stacked high against the plaintiff:  not only are RICO cases notoriously difficult to prove, but no pharmaceutical company had ever been held liable under RICO.
 
Drawing on his knowledge about Neurontin and Pfizer’s marketing practices from his many years litigating Dr. Franklin’s case, Greene, Barrett and Sobel, who were counsel for the proposed class of consumers and third-party payers, conducted an extraordinary amount of discovery, including the creation of a searchable database containing millions of pages of documents.  Pfizer had produced nearly three million pages of documents and it took a monumental effort to pinpoint the hundreds of documents critical to success at trial. 
 
Nussbaum, who had represented Kaiser in the years leading up to trial, brought in Greene, Barrett and Sobel to try the bellwether case with her.  The legal team faced many obstacles.  For one, they had to prove that Neurontin was ineffective for the various off-label uses at issue—bipolar disorder, migraines and neuropathic pain, among others.  Although clinical trials had shown that Neurontin was no more effective than a sugar pill in treating these conditions, physicians claimed that the drug worked.
 
Pfizer argued that the anecdotal evidence of so many physicians was evidence that the drug was effective.  But the attorneys argued that the physicians, just like consumers and insurers, had been duped.  The team’s principal strategy was to differentiate evidence-based medicine from the marketing-based messages that Pfizer had planted in the medical literature.  They used expert witnesses to show that Pfizer’s marketing campaign for Neurontin had even infiltrated the medical literature that doctors view as sacrosanct.
 
The trial team also faced the unique impediment of presenting evidence of a RICO conspiracy to the jury without having a single Pfizer employee to take the stand.  After the attorneys convinced the court that the RICO evidence was admissible and showed RICO violations of all of the proposed off-label uses of Neurontin, Greene had to walk the jury through the specifics of the RICO enterprise for the first time during a two-hour closing argument.
 
Ultimately, the trial team proved that Pfizer and its advertising agencies were a racketeering enterprise created to defraud consumers and health care plans into paying top dollar for Neurontin prescriptions instead of other medications.  On March 25, 2010, the federal jury in Boston hit Pfizer with a $47.36 million damages award, which was automatically tripled under RICO and resulted in a total of over $142 million.  The judge awarded Kaiser $95 million for Pfizer’s violation of California’s UCL, though that award was not cumulative. 
 
The Kaiser case made public the devious methods that a pharmaceutical giant used to subvert the FDA’s regulatory process.  Pfizer had successfully converted a niche drug with limited market potential into a billion dollar bonanza—despite the fact that the drug didn’t work for any of the touted off-label uses.
 
Though the victory in Kaiser involved but one insurer, it will have a broad impact on the hundreds of other cases in the MDL, as the judge presiding over the MDL has signaled that her findings of fact in the Kaiser trial will have a res judicata effect in those cases.  It also set a key precedent:  before this trial, no private party had ever successfully sued a pharmaceutical company for fraudulent off-label promotion and no pharmaceutical company had ever been held liable under RICO.  Perhaps the greatest effect of this case may be in curbing pharmaceutical fraud and paving the way for future plaintiffs to combat fraudulent off-label promotion through the judicial system. 

We would also thank Palko Goldman, M.D., of Greene LLP in Boston for his assistance in preparing medical experts and Kaiser’s fact witnesses for trial.

Winning Justice and Freedom for a Wrongfully Convicted Man

Toyota has long been known as a maker of safe, reliable automobiles.  But vehicle recalls within the last few years have hurt the company’s reputation.  One of those recalls involved the problem of unintended acceleration—a car lurching forward when the driver’s foot is not on the gas.  That defect likely contributed to a 2006 crash that resulted in the deaths of three people in Minnesota.  In conjunction with that tragic accident, an innocent man was convicted of vehicular homicide and sentenced to eight years in prison.
 
Koua Fong Lee, a Hmong immigrant, had served almost three years of his prison sentence when trial lawyer Robert Hilliard of Hilliard Muñoz Gonzales LLP in Corpus Christi, Texas, took on the case pro bono with local criminal defense counsel Brent Schafer of the Schafer Law Firm in Eagan, Minn., to fight for Lee’s freedom.  Using his wealth of products liability experience, Hilliard won a new trial for Lee in Lee v. State of Minnesota, ultimately convincing the State to drop the charges and release Lee from prison.
 
On June 10, 2006, Lee was driving his 1996 Toyota Camry home from church with four members of his family.  As Lee headed up an exit ramp, his car slammed into the back of another vehicle.  The 33-year old driver of the rear-ended vehicle and his nine-year-old son died at the scene.  Another passenger, the driver’s seven-year-old niece, was left a quadriplegic and died from those injuries a year later.
 
In the aftermath of the accident, Lee was convicted of vehicular homicide.  Lee had few financial resources and did not speak much English.  During the trial, Lee’s lawyer erroneously told the court that Lee had mistakenly hit the gas pedal before the accident occurred; Lee, in contrast, adamantly maintained that he had stepped on the brakes to stop the car, but that the car had continued to accelerate.
 
A few years later, Toyota began recalling some of its late-model Camrys.  Drivers were reporting the same problem that Lee had cited during his trial, and the recalls brought new life to Lee’s case.  The families of the three people killed in the crash with Lee sued Toyota, and Hilliard was asked to consider joining the legal team for one of the families because of his experience in products liability litigation.  After investigating the case, however, Hilliard was convinced that Lee had been wrongfully convicted and approached the family’s attorneys about the idea of freeing Lee.  Hilliard was quickly rebuffed and fired.  Though he had no prior experience in criminal law, Hilliard then reached out to Lee’s new defense attorney, Schafer, and offered to volunteer his time to help overturn Lee’s conviction.  Together, they filed a petition seeking post-conviction relief, hoping to get Lee a new trial.
 
Overturning a criminal conviction is extremely difficult, especially when you’re arguing in front of the same judge who sentenced the prisoner.  For Lee to get a new trial, Hilliard and Schafer had to convince the judge that there was newly discovered evidence or ineffective assistance of counsel.  Hilliard believed he could persuade the judge on both grounds.  During a four-day evidentiary hearing in August 2010, Hilliard showed that the State had buried evidence that Lee had attempted to stop his car before the crash and that a State’s star witness had lied about the Camry’s braking system.  Hilliard and Schafer also called 11 witnesses, all of whom owned ’96 Camrys and had experienced the same unintended acceleration as Lee.
 
At the final day of the hearing, prosecutors offered Lee a deal:  plead guilty to a felony and go free immediately.  But after talking with Hilliard and Schafer, Lee wouldn’t take deal, opting to remain in prison for five more years rather than admit guilt for something he did not do.  Later that afternoon, the same judge who had sentenced Lee concluded that Lee was entitled to a new trial.  She ordered that Lee be immediately released from prison pending the trial and, less than an hour later, the prosecutors announced that the State was dropping all charges against Lee.
 
After almost three years of being locked up at several Minnesota prisons, Lee walked free and was reunited with his wife and four children.  The victory in Lee not only gave a voice to a man who had been powerless to stop his wrongful conviction, but helped others nationwide who had either been convicted of vehicular manslaughter while driving a Toyota or were facing criminal charges.  After winning Lee’s freedom, Hilliard continued his pursuit of justice for owners of defective Toyotas and was recently appointed liaison counsel for the Plaintiffs’ Steering Committee in an ongoing case against Toyota, In Re Unintended Acceleration Litigation. 

Making the Nursing Home Industry Provide Better Elder Care

Skilled Healthcare Group, Inc. owns and operates nursing homes throughout the U.S.  It is the fifth-largest nursing home chain in the country, and, since going public in 2007, has reported an average annual profit of more than $120 million.  But even with such hefty assets, for years the company wasn’t employing enough staff to provide the care needed by its elder residents: overstretched employees working double and triple shifts simply could not get to all the residents.  Some residents weren’t given their medications or pain killers in a timely manner; others weren’t provided a shower or food; and some incontinent patients were left to lie in their own waste. 
 
Skilled Healthcare’s inexcusable practice of intentionally understaffing its nursing homes—to cut overhead and boost profits—inspired some residents’ families to seek help from W. Timothy Needham of Janssen, Malloy, Needham, Morrison,, Reinholtsen, Crowley & Griego, LLP in Eureka, Calif.  After six years of litigation that included a seven-month trial, Tim Needham and his co-counsel—California attorneys Michael D. Thamer of the Law Offices of Michael D. Thamer in Callahan; Christopher J. Healey of Luce, Forward, Hamilton & Scripps, LLP in San Diego; and Michael J. Crowley, Patrik Griego, and Amelia Burroughs of  Janssen, Malloy, Needham, Morrison, Reinholtsen, Crowley & Griego, LLP in Eureka—won a staggering $677 million jury verdict for a class of approximately 32,000 current and former nursing home residents and their families in Lavender v. Skilled Healthcare Group, Inc.  This was the first class-wide understaffing case to be tried to verdict and the largest ever verdict against a nursing home chain.  The parties ultimately settled the case for $50 million and injunctive relief valued at $12.8 million that would result in improved staffing levels at the nursing homes.
 
Needham and his team filed the class action lawsuit in May 2006, contending that 22 California nursing homes owned by Skilled Healthcare had failed to provide adequate staffing for its residents over a period from 2003 to 2010, in violation of California health and safety laws.  The class sought damages of up to $500 per violation per patient day, as well as injunctive relief requiring the nursing home chain to improve its staffing levels.  Needham and his co-counsel gathered evidence showing that Skilled Healthcare had violated adequate staffing requirements for 9,617 days, translating to 1,178,090 patient days.
 
More than three years elapsed before the case went to trial in 2009.  Needham and his co-counsel had to slog through numerous procedural fights as the defense did all it could to slow the case to a crawl.  Over 120 motions were filed; the plaintiffs’ lawyers prevailed on all of them.  The team defeated a motion to decertify the class, motions to change venue, and motions to disqualify the trial judge on alleged bias, among others.  Needham’s team also prevailed on a dozen appellate writs and two appeals filed by the defendant.  By the end of the case, Needham and his team had logged nearly 29,000 hours and had incurred more than $1.7 million in out-of-pocket expenses.
 
Trying the class action was a massive undertaking that took seven months:  150 witnesses testified and over 5,000 exhibits were introduced.  Needham’s main trial strategy was to avoid having the case appear to be about numbers; the goal was to get the jury to understand that the numbers equated to human suffering.  Many nursing home residents and their family members testified.  Needham and his team also tried to show that, even when the state’s Department of Public Health (DPH) issued staffing deficiency warnings against Skilled Healthcare, the company ignored them.  Indeed, internal e-mails showed that the DPH warnings were treated as a running joke among Skilled Healthcare’s corporate higher-ups.  Finally, the trial team also demonstrated that Skilled Healthcare’s decision to understaff its facilities was made at the highest levels of its corporate ladder. 
 
Needham’s trial strategy paid off.  In July 2011, a Humboldt County jury awarded the class a historic $677 million, finding that Skilled Healthcare had failed to maintain the state-mandated 3.2 nursing hours of “direct patient care” per patient per day at all 22 of its facilities over the course of more than six years. 
 
Because the amount of the jury’s award far exceeded the defendant’s net worth, the parties entered into mediation after trial.  In December 2010, the court approved a settlement requiring the defendant to pay $50 million to the class and to spend $12.8 million over a two-year period to improve staffing levels in its nursing homes (which includes paying for a court-appointed monitor to ensure compliance).
 
The Lavender case has had a major impact on the nursing home industry.  The verdict forced a significant number of nursing homes to increase the level of care they provide and caused nursing homes throughout California to re-evaluate their staffing levels.  The case also filled an important void by getting justice for thousands of citizens that the state could not protect:  DPH, suffering from the state’s significant budget deficit, simply lacked the resources to enforce its policy of protecting elders in residential care facilities.  Other plaintiffs’ attorneys are now helping to fill this void, thanks to the victory that Needham and his team achieved in Lavender. 

Ensuring Equal Treatment for Native American Farmers

George and Marilyn Keepseagle have been in the ranching business for 40 years.  But, as Native Americans ranchers on the Standing Rock Reservation in North Dakota, making a living hasn’t been easy: for years they felt that the U.S. Department of Agriculture (USDA) wasn’t treating them equally compared to white farmers.  It turned out the Keepseagles were right.  And the Keepseagles weren’t alone: as one Native American farmer said, “So many people lost land or lost opportunities that should have been there for them.”
 
For decades, thousands of Native American farmers and ranchers around the country were not receiving the same low-interest government loans that white farmers were.  In 2001, a group of attorneys asked Joseph M. Sellers, of Cohen Milstein Sellers & Toll PLLC in Washington, D.C., to lead a class action lawsuit that they had recently filed against the USDA.  And after 11 years of litigation by Sellers’ team—which included Washington, D.C., lawyers Christine Webber and Peter Romer-Friedman, also of Cohen Milstein Sellers & Toll PLLC; David Frantz of Conlon, Frantz & Phelan, LLP; Paul Smith, Katherine Fallow, Michael Brody, Jessica Amunson and Carrie Apfel of Jenner & Block LLP; Anurag Varma of Patton Boggs LLP; and Phillip Fraas of Stinson Morrison Hecker LLP, as well as Sarah Vogel of Sarah Vogel Law Partners in Bismarck, N.D.—the USDA agreed to a $760 million settlement with thousands of Native American farmers and ranchers around the country.  The historic settlement in Keepseagle v. Vilsack, includes $680 million in damages, $80 million in farm loan forgiveness, and far-reaching reforms to the USDA’s farm loan program that will improve services for Native Americans.
 
The class action lawsuit, filed in November, 1999, alleged that thousands of Native American farmers and ranchers had suffered credit discrimination at the hands of the USDA since as early as 1981.  Specifically, the suit alleged that the USDA routinely denied Native Americans loans and loan servicing opportunities by:  denying them loans under the same terms upon which it would grant loans to white farmers; denying them the opportunity to refinance when they could not make the payments, and foreclosing on their property, under circumstances where they would have permitted white farmers to refinance; imposing special conditions on their businesses when their white counterparts had no such restrictions; and blatantly discriminating against them, such as by telling them that they didn’t know how to manage a business, were all drunks, and that they should go to the Bureau of Indian Affairs—not the USDA—to get money.
 
The statute under which this case was brought—the Equal Credit Opportunity Act (ECOA)—had never been applied in this kind of setting, where the misconduct had to be inferred from an array of statistical, anecdotal and circumstantial evidence.  To address this challenge, Sellers’ designed a strategy pursuant to which the plaintiffs would show a pattern or practice of discrimination based on disparate impact theories of discrimination drawn from Equal Employment Opportunity (EEO) jurisprudence.
 
The case presented unusual challenges and required a particularly creative and tenacious trial team, due to the broad geographical scope of the case, which affected Native American farmers and ranchers all across the country; the USDA’s failure to retain loan records for unsuccessful applicants and other records pertinent to deficiencies in its loan program; and the uncertainty of applying EEO class action litigation techniques to an ECOA case. 
 
By the time Sellers’ team had completed the six-year discovery process, the attorneys had interviewed several thousand witnesses from more than 100 tribal nations, taken over 100 depositions, and reviewed more than 2 million pages of documents.  During the 11 years of litigation, the team had also fought and won two interlocutory appeals—one on class certification and one staving off a stay of all proceedings.  They also compiled more than ten expert reports, including one prepared by a former USDA official showing that Native American farmers and ranchers had received only half of the loans that they should have between 1981 and 2007, resulting in the denial of $3 billion in credit and $776 million in net economic losses.  Sellers’ team also sought and obtained a court order allowing Native Americans who had filed oral complaints of discrimination to be included in the class.
 
In the end, the trial team uncovered three decades of discrimination by the USDA.  And the
USDA and Department of Justice finally asked Sellers’ team to discuss settling the case.
 
But the trial team’s work was far from over.  For ten months, the attorneys met and exchanged numerous drafts with government lawyers, negotiating not only for monetary compensation for their clients but also for significant changes to the USDA’s farm loan program so that future generations of Native American farmers and ranchers would be ensured just and equal treatment.  In April, 2011, the court gave final approval to the 52-page settlement agreement negotiated by Sellers and his team.
 
The $760 million settlement represents 98 percent of what the plaintiffs might have obtained at trial.  The settlement not only compensates Native American farmers and ranchers for three decades of systematic discrimination but ensures far-reaching reforms to the USDA’s farm loan program, including the creation of a Native American Farmer & Rancher Council, a new federal advisory committee.  President Obama lauded the settlement as “an important step forward in remedying the USDA’s unfortunate civil rights history.”
 
Sellers and his team forever changed the way the USDA will conduct its farm loan program.  This settlement first and foremost compensates the victims of discrimination and provides relief from the threat of foreclosure to thousands of poor and middle-class Native Americans whose farms and ranches have been in their families for generations.  But it also offers a long-lasting solution to the plaintiffs’ grievances—by forming a council intent on addressing and protecting Native American farmers and ranchers’ civil rights—that will benefit Native Americans for generations to come.