WASHINGTON, April 8, 2016 - Millions of dollars left over from a class-action settlement involving black farmers will be available for distribution to law schools or nonprofit organizations, under an order issued today by U.S. District Judge Paul Friedman.
About $1 billion in payments has been issued to approximately 18,000 claimants under the second phase of the long-running litigation, leaving about $9.5 million left over, although the precise amount isn’t known.
“It’s not $20 million, it’s not $1 million,” said Andrew Marks, one of the attorneys for the members of the plaintiff class, who is with Miami law firm Coffey Burlington.Marks said the next step is for Friedman to decide exactly who should receive the funds. That process will likely take more than a few months.
Friedman had been mulling the possibility of distributing the remaining funds to members of the class, but both the plaintiffs’ counsel and the government arguedthat he did not have the authority to modify the terms of the settlement agreement.
“A decision to pay out the unclaimed settlement funds to the roughly 18,000 Class Members who already have received full payment of their claims would afford a modest benefit – on the order of $500 (before taxes) – to these particular class members,” the lawyers for the class members said in a brief filed Dec. 18. “But such a supplemental distribution would provide no benefit at all to the thousands of other Class Members who either did not submit a claim under the Consent Decree or who, for one reason or another, did not have their claims approved.”
“In contrast, implementation of the cy pres provisions of the Settlement Agreement would benefit the entire Class. That is because all Class Members were the victims, or at least believed themselves to be the victims, of discriminatory practices by the U.S. Department of Agriculture,” the brief continued.
The settlement agreement contains “no injunctive or other prospective relief that would address potential future discrimination against black farmers,” they said. “All Class Members, therefore, share an interest in having robust non-governmental organizations available to assist them, as well as other black farmers, with future discrimination and other challenges they may face to their ability to farm.”
Cy pres is French for “as near as.” In class-action cases, cy pres provisions allow a judge, after the settlement funds have been disbursed, to distribute the remainderto charitable organizations.
The relevant provision in the settlement says the left-over money must go to either of two places: first is “a law school that has a low-income taxpayer clinic or program that provides tax advice or assistance to Class Members who have received an award under the Settlement Agreement and that has been approved by the Court.” Second is “a tax-exempt non-profit organization, other than a law firm, legal services entity, or educational institution, that is providing agricultural, business assistance, or advocacy services, including assistance under Pigford and the Consolidated Case, to African American farmers.”
The original discrimination case (known as Pigford I, with the latest version being Pigford II) also resulted in about $1 billion in payments to black farmers. But after thousands more claims than anticipated were submitted, Congress included language in the 2008 Farm Bill allowing more claims to be considered.
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