Interior Secretary’s Trial on Indian Trust Is Postponed a Week

A federal judge on Friday renewed his threat to find Interior Secretary Gale A. Norton in contempt of court but postponed her trial by a week, acknowledging that she has taken a personal role in trying to eliminate mismanagement of the department’s Indian trust fund.

Native American groups, however, told U.S. District Judge Royce C. Lamberth that they were prepared to begin trial Monday, as originally scheduled. But if civil contempt proceedings are delayed until Dec. 10, as Lamberth tentatively ruled Friday, lawyers for Native Americans said they want a lengthy trial to examine all aspects of the long-troubled multibillion-dollar fund.

The government has admitted that it cannot determine how much money is in the account because its records are in such disarray. The trust fund, established more than 100 years ago, handles the disbursement to tribal members of the leasing fees for more than 54 million acres of Indian land.

Lamberth said he would conduct closed-door sessions next week with attorneys for both sides to determine how many witnesses might be called. He held open the possibility of a further postponement of Norton’s trial, depending on the complexity of the issues to be raised.

In his first kind words for Norton, Lamberth noted her “personal involvement” in problems with the trust fund--a sentiment he said “was never apparent” from her predecessor, Bruce Babbitt, who was Interior secretary for eight years during the Clinton administration.

Mark Nagle, a government attorney representing Norton, said the judge was improperly basing a contempt trial on a series of scathing reports submitted by a court monitor appointed in April. Joseph S. Kieffer III, who assessed the Interior Department’s compliance with reform orders issued by Lamberth two years ago, said he found repeated discrepancies in what Norton’s department was telling the judge about its accounting and data cleanup efforts.

Norton agreed to Kieffer’s appointment, but Kieffer himself said his conclusions “have not been independently confirmed,” Nagle told the court, adding that his report “was not an adjudicative process.” Nagle argued that Lamberth should reconsider contempt proceedings or postpone any trial until early next year.

Norton was not present in the courtroom.

Problems with the trust fund first attracted public attention in 1996, when Native American groups filed a class-action lawsuit claiming the government owed 300,000 tribal members at least $10 billion that was unaccounted for. The trust fund was established in the 1800s to hold and distribute fees from oil, grazing, drilling and logging leases on tribal land.

During the Clinton administration, officials at the Interior and Treasury departments reported that, while the government had deposited an estimated $350 million to $500 million a year for decades into the trust fund, they could not account for that money.

Many documents were mishandled, destroyed by floods or were simply lost over the years, they said.

Lamberth at that time held Babbitt and then-Treasury Secretary Robert E. Rubin in contempt for failing to correct mismanagement of the fund, for failing to produce documents and for allowing the destruction of files. The judge fined them $625,000, which the government paid.

Norton recently reorganized management of the fund under one official and promised to consult with representatives of Native Americans and other interested parties on reform efforts. Indian groups long have complained about being kept in the dark about problems with the fund.