Rough Terrain

When Jennifer McDannell took on William Munn’s discrimination claim against the U.S. Department of Agriculture last November, the senior associate at Howrey Simon Arnold & White thought she was taking on a challenging but straightforward pro bono case. It was an arbitration. The government had admitted liability in the underlying case, Pigford v. Veneman. And she’d already handled three — albeit simpler — claims against the Agriculture Department. How hard could it be? For McDannell and her firm, the case has become a major project. Soon after signing on, McDannell was repeatedly flying down to Ozan, Ark., to meet with her client and prep him and his witnesses. Less than 24 hours before Munn’s arbitration, the government dropped a motion on her, claiming bias by the arbitrator. She scrambled to get a handful of associates to help her brief an answer. “We got the motion at noon the day before the hearing,” she says. McDannell had to spend six hours in oral argument fighting the bias motion. Her client’s arbitration hearing was delayed a month to June 7, and they are still waiting for a decision. To date, McDannell, a 30-year-old antitrust lawyer, associate Melissa Nichols, and other Howrey attorneys have expended over 2,000 pro bono hours on Munn’s case. The firm has also logged almost 1,100 hours on 31 other Pigford-related claims. Howrey is not alone. Across the city, dozens of firms have put in tens of thousands of hours on what is the largest single collective D.C. pro bono project in recent memory — and one with an usual genesis. Pigford v. Glickman, as it was then known, was filed in 1997. Two years later, Daniel Glickman, secretary of agriculture under President Bill Clinton, and the plaintiffs’ attorneys announced they had reached a historic settlement. It admitted that the department had for decades systematically discriminated against black farmers in its programs, including loans and crop subsidies, and set up a means for monetary compensation. All that was left to do was disburse the awards to farmers who filed discrimination claims. But the execution did not move as quickly or as smoothly as hoped, and last year, U.S. District Judge Paul Friedman, unhappy with the progress plaintiffs lawyers were making, brought in D.C. law firms to serve, pro bono, as plaintiffs counsel for some of the farmers. Their work has mushroomed. The unusual nature of the litigation has left lawyers writing on a procedural blank slate. Lawyers are making their way through cases governed not by the Federal Rules of Procedure — but instead by rules set by Judge Friedman. As recently as Oct. 29, Friedman issued an order establishing the procedure for appealing a rejection from the Pigford class. Friedman handed down earlier rulings, too, attempting to guide lawyers and farmers through the process. Meanwhile, the government, represented by lawyers at the Department of Justice, is fighting hard. Too hard, some say. A number of the pro bono attorneys claim their adversaries are unnecessarily delaying cases — and upping the hours firms are putting in. “They file motion after motion to dismiss” farmers’ claims, and “they have appealed virtually every case where the farmer has prevailed,” says Anthony Herman, a Covington & Burling partner who has coordinated the complicated claims, known as Track B cases. “Their conduct has really been quite remarkable and quite disappointing.” A Justice Department spokesperson declined comment. In a Sept. 25 statement to a U.S. House of Representatives subcommittee, Lou Gallegos, assistant secretary for administration at the Agriculture Department, said “thousands of staff hours” had gone into Pigford and labeled claims the government has dragged its feet a “myth.” The tussle between the government and the pro bono lawyers might soon come to an end. A global settlement is in discussion, say two lawyers with knowledge of the process. GETTING ON TRACK Under the 1999 settlement in Pigford, all farmers had to do was file evidence of their discrimination and wait for their money — or at least that’s what they thought. The consent decree set up two categories of cases. Under Track A, farmers file evidence of “substantial discrimination” by the Agriculture Department, and that evidence goes before an adjudicator. If upheld by the adjudicator, farmers get $50,000 and loan forgiveness. For farmers who believe they have evidence of “extreme wrongdoing,” Track B is the path. It is like litigation, with motions, a hearing, and awards for any amount. The reality, especially for attorneys who have taken on the more difficult Track B cases, has been hundreds, and sometimes thousands, of hours spent fighting one pro bono discrimination case. “Generally, these are difficult cases,” explains Michael Lewis, a lawyer at D.C.’s ADR Associates who has been assigned to arbitrate the Track B matters. “Some of the claims go back 20 years, or almost 20 years, and there often is not much documentation.” The pro bono lawyers have had to unearth evidence that white farmers, in similar situations, got a better deal from the government — more money or better terms on loans. The lawyers have pawed through years-old documents tucked away in rural courthouses and Agriculture Department offices. The settlement also gives the government the chance to dispute that proof. For the government, a lot of money is on the line. Nearly $630 million has been paid out to 12,597 of the 21,583 farmers who filed the simpler Track A claims and had their claims upheld after an adjudication. The government also forgave more than $17 million of those farmers’ loans as of Aug. 29, according to the latest numbers from the Agriculture Department. Although 8,493 farmers have had their Track A claims denied as of Aug. 29, the Justice Department, in an Oct. 17 pleading, conceded that “a substantial number of those who lost before the adjudicators are likely to prevail upon re-examination.” Of the Track B cases, the government has settled 54 of the 181 claims, agreeing to pay more than $7 million as of March 29, the most recent figures available from the department. Fifteen other farmers lost their Track B petitions in arbitration, but 10 prevailed, garnering awards totaling $5.5 million. More Track B cases continue to go to arbitration, and both farmers and the government are appealing initial decisions. On top of payouts, the Agriculture Department must fund Monitor Randi Ilyse Roth’s St. Paul, Minn., office, which handles all of the appeals. Her budget for the last six months of 2002: $4 million. During 2001, it hit $5.8 million for a six-month period. “It is apparent to me that the government now recognizes a very huge liability in connection with this,” says Jeffrey Green, a D.C. partner who chairs Sidley Austin Brown & Woods’ pro bono committee. And while trying to put the black farmers’ case behind it, the government is facing a new wave of litigation on behalf of Hispanic, Native American, and women farmers. Plaintiffs lawyers in three separate suits, claiming discrimination by the Agriculture Department, have sought class certification. DOWN ON THE FARM William Munn lost almost all of his family farm in foreclosure after receiving less-favorable loans from the government than neighboring white farmers, says McDannell, his lawyer at Howrey Simon. Munn’s phone was shut off two weeks ago, and he now can only receive McDannell’s calls through his sister. He’s currently trying to farm with mules, after losing his farm equipment. Back in 1981, Munn was, in fact, approved for a loan to add more land to his 250-acre farm-but only “on the condition that he sell part of his land to this white farmer who was looking for land,” says McDannell. “He also consistently got his [operating] loans later than other farmers,” which delayed when he could plant his seed, decreased the yield from his crops, and kept Munn from bringing home enough money to keep his farm alive. Robert Holmes, a third generation Arkansas soybean, milo, and wheat farmer, also has been trying to make ends meet while waiting for his funds, says Covington & Burling associate Rebecca Woods. “They would eventually loan them money, but they did it so late in the growing season, it was essentially like not giving them money. He was effectively driven out of business.” Holmes, who used to rent farm land, now lives an hour south of Chicago and is hoping to make a living in landscaping. “He graduated from high school,” says Woods. But, she adds, “he doesn’t have a r�sum�. His skills are entirely making crops grow.” As for Munn, “it’s going to take him another year and a half” to get funds, if either side appeals the arbitrator’s decision, which has not yet been handed down, explains McDannell. “We’re trying to work out a settlement to get him something sooner.” Already, Munn has been waiting for years. “He was ready to go to arbitration back in, I think, 1999,” says McDannell. Other attorneys who signed on last year to handle Track B claims say that the process wasn’t meant to, and shouldn’t, mimic contentious litigation, though. Covington associate Donald Ridings, who took his Track B case to arbitration on Nov. 6, asserts the Justice Department officials who are overseeing the case were once more interested in righting a wrong, but that the attitude changed with the Bush administration. He says he understands that the government has to “protect the interests of the taxpayers” by distinguishing between meritorious and frivolous claims. But, says Ridings, “there was somewhat more cooperative fact-finding when the government was as interested in getting at the truth in these cases as it was in winning. This is now kill-or-be-killed litigation.” Agriculture official Gallegos, in his Sept. 25 statement to Congress, appeared somewhat conciliatory, saying, “The key now is for the parties to continue to work together.” Any problems due to the less-than-friendly relationship between the government and counsel is only exacerbated by the structure of the Pigford settlement, say attorneys. “The procedures are not crystal clear,” says Sidley’s Green. Woods agrees. “The clients, the attorneys, and the arbitrator are all fumbling their way through the consent decree. The consent decree is supposedly self-contained,” she says, “but it doesn’t provide for a lot of mechanisms you’d expect in litigation.” Judge Friedman is filling in the blanks as the case goes on in orders like the one he issued on Oct. 29. (According to court documents, approximately 129 farmers who filed complete claim forms under Track A or B were not permitted to proceed under the class, and the order set up the procedure for appeal.) NEXT ROUND OF SUITS Stephen Hill, a partner at Howrey Simon, hopes to avoid the pitfalls of Pigford altogether. He’s handling Garcia v. Veneman, the Hispanic farmers’ case against the Agriculture Department. “For better or for worse, the plaintiffs in the Pigford case focused on the money damages and didn’t really focus on the injunctive relief and trying to fix the system,” says Hill. While it is “important to be compensated for that harm,” he says, farmers currently “find themselves having to go back and deal with those same officials” who originally discriminated against them. Hill, who is representing the Hispanic farmers on a contingent fee basis, is waiting for a decision from U.S. District Judge James Robertson on his request for class certification. He is hopeful that any ruling will be in their favor, given a recent D.C. Circuit decision essentially upholding class certification for Native Americans. Joseph Sellers, a partner at Cohen, Milstein, Hausfeld & Toll, argued before the D.C. Circuit for the Native Americans. Women farmers are also waiting for a ruling on class certification. If the outcome of any of these cases comes close to the money spent in Pigford, the government is open to serious liability. “Certainly, $600 million at first blush seems like a lot of money,” says Hill. “But you have a long period of time in which the Agriculture Department has discriminated against an awful lot of farmers.” He adds, “That’s a problem purely of their own making.”