IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OKLAHOMA

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1 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF OKLAHOMA WILLIAM S. FLETCHER, et alia, ) ) Plaintiffs, ) ) v. ) Case No. 0-CV-(K)(M) ) THE UNITED STATES OF AMERICA, ) et alia, ) ) Defendants. ) DEFENDANTS REPLY IN SUPPORT OF SUPPLEMENTAL MOTION TO DISMISS 0

2 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of TABLE OF CONTENTS ARGUMENT... I. The Pendency of the Osage Tribe s Actions in the Court of Federal Claims and District Court For the District of Columbia Compels a Conclusion It is a Necessary and Indispensable Party to This Action... A. The Osage Tribe is a Necessary Party Under Rule (a)()... B. The Osage Tribe is Also a Necessary Party Under Rule (a)().... The Osage Tribe claims an interest relating to the subject of this action.... The Osage Tribe is a necessary party under Fed. R. Civ. P. (a)() because disposition of this case will either impede the Tribe s claimed interest or subject the United States to risk of double or inconsistent obligations... C. The Osage Tribe Is Also an Indispensable Party under Rule (b)... D. Rule Is Not Inapplicable Merely Because Plaintiffs Allege a Putative Plaintiffs Class Action under Rule... II. III. Non-Osages are Necessary and Indispensable Parties... The Statute of Limitations Fully Applies to Any Challenge to An Ownership Interest in an Osage Headright... A. Any Claim Challenging the United States Decision as to the Proper Ownership of a Headrights Interest Is Time Barred... 0 B. The Appropriations Rider May Not Be Construed to Revive Stale Claims... IV. Plaintiffs Have Not Established This Court s Jurisdiction Under the APA... CONCLUSION... -i-

3 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 TABLE OF AUTHORITIES CASES Alfred L. Snapp & Son, Inc. v. Puerto Rico, U.S. ()... Ash Creek Mining Co. v. Lujan, F.d 0 (th Cir.)... Blake v. Arnett, F.d 0 (th Cir. )... Chenault v. United States Postal Serv., F.d (th Cir. )... Cherokee Nation v. United States, F.R.D. (E.D. Okla. 00)... Cobell v. Norton, 0 F. Supp. d (D.D.C. )... Cobell v. Norton, F.d 0 (D.C. Cir. 00)... Cross Timbers Oil Co. v. Rosel Energy, Inc., F.R.D. (D. Kan.)... DuMarce v. Scarlett, F.d (Fed. Cir. 00)...0 Estate of Shelton v. Oklahoma Tax Comm n., P.d (Okla. )... Fletcher v. United States, F.d (th Cir. )..., Fletcher v. United States, Fed. Appx. (th Cir. 00)..., Fullerton-Krueger Lumber Co. v. Northern Pac. Ry., U.S. ()... Gros Ventre Tribe v. United States, F.d, 00 WL (th Cir. 00)... Hem v. Maurer, Fd (th Cir. 00)... Hughes Aircraft Co. v. United States ex rel. Schumer, 0 U.S. ()... INS v. St. Cyr, U.S. (00)... Knutzen v. Eben Ezer Lutheran Housing Ctr., F.d (th Cir. )... Lane v. Pena, U.S. ()... Lujan v. Defenders of Wildlife, 0 U.S. ()... Norton v. Southern Utah Wilderness Alliance, U.S. (00)... Osage Tribe v. United States, Fed. Cl. (00)... Osage Tribe v. United States, Fed. Cl. (00)... Resolution Trust Corp. v. Seale, F.d 0 (th Cir. )... -ii-

4 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 Shimkus v. Gersten Companies, F.d (th Cir )... Shoshone Indian Tribe of the Wind River Reservation v. United States, F.d (Fed. Cir.00)... passim Sierra Club v. U.S. Dep t of Energy, F. Supp. d (D. Colo.,)... Stogner v. California, U.S. 0 (00)... United States v. Mottaz, U.S. ()...0 United States v. Murdock, F.d (th Cir. )... United States v. Nordic Village Inc., 0 U.S. 0 ()... United Tribe of Shawnee Indians v. United States, F.d (th Cir. 00)... Village of Bellwood v. Dwivedi, F.d (th Cir. 0)... Wolfchild v. United States, Fed. Cl. (00)... Wyandotte Nation v. Unified Gov t of Wyandotte County, F.R.D. 0 (D. Kan. 00)... STATUTES U.S.C. et seq.... U.S.C U.S.C U.S.C U.S.C. a... U.S.C. 0...,, U.S.C U.S.C. 0 note..., U.S.C.... U.S.C U.S.C. 0..., 0 Pub. L. No. -, Stat. ()..., Pub. L. No. -0, Stat. ()... Pub. L. No. -, Stat. ()... -iii-

5 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of Pub. L. No. -, Stat. (00)... Pub. L. No. -, Stat. 0 (00)..., 0 Pub. L. No. -, Stat. 0 (00)... RULES Fed. R. Civ. P.... passim Fed. R. Civ. P...., Fed. R. Civ. P.... REGULATIONS C.F.R , 0 C.F.R , 0 LEGISLATIVE MATERIAL H.R. Rep. No S. Rep. No. - (0)... OTHER AUTHORITIES C. WRIGHT, A. MILLER & KANE, FED. PRACTICE AND PROCEDURE (00) iv-

6 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 ARGUMENT I. The Pendency of the Osage Tribe s Actions in the Court of Federal Claims and District Court For the District of Columbia Compels a Conclusion It is a Necessary and Indispensable Party To This Action. Plaintiffs Response Brief does not accurately set forth the required analysis under Rule. The first question presented under Fed. R. Civ. P. (a) is whether the Osage Tribe is a necessary party. There is no precise formula for determining whether a particular nonparty must be joined under Rule (a). The decision has to be made in terms of the general policies of avoiding multiple litigation, providing the parties with complete and effective relief in a single action, and protecting the absent persons from the possible prejudicial effect of deciding the case without them. Knutzen v. Eben Ezer Lutheran Housing Center, F.d, (th Cir. ), citing WRIGHT, MILLER & KANE, FEDERAL PRACTICE AND PROCEDURE (). The text of Rule (a) provides three separate circumstances in which a person is considered a necessary party. Each of the three analyses supports the conclusion that the Osage Tribe is a necessary party. A. The Osage Tribe is a Necessary Party Under Rule (a)(). The first of the circumstances in which a person is necessary is if, in the person s absence, complete relief cannot be accorded among those already parties. Fed. R. Civ. P. (a)(). This standard:... is designed to protect those who already are parties by requiring the presence of all persons who have an interest in the litigation so that any relief that may be awarded will effectively and completely adjudicate the dispute.... This standard also furthers the interest of the public in judicial economy by avoiding repeated lawsuits involving essentially the same subject matter. Thus, courts also have considered in evaluating this factor whether joinder will avoid multiple actions and potentially inconsistent verdicts. If so, joinder may be appropriate. WRIGHT, MILLER & KANE, FEDERAL PRACTICE AND PROCEDURE (00). To determine whether complete relief can be awarded, the court must consider the type of relief sought by the parties who remain in the lawsuit. Wyandotte Nation v. Unified Gov t of Wyandotte County, F.R.D. 0, 0 (D. Kan. 00). In this case, the common element in the various forms of relief sought here is that they each --

7 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 demand action with regard to the Department of the Interior s handling of the quarterly headrights payment. As we explained in our opening brief, the quarterly headrights payments are disbursements from, and hence a decrease to the balance of a trust account maintained by the Department of the Interior held on behalf of the Osage Tribe. See Opening Brief at -. And the Osage Tribe has separately pending suits alleging claims regarding the quarterly annuity transactions Plaintiffs challenge here. It would be problematic for the Court to reorder and restate the Osage trust fund and its disbursement transactions without also considering the Osage Tribe s interest in the account and the pending adjudication of the Tribe s own accounting and trust fund mismanagement suits. See Cross Timbers Oil Co. v. Rosel Energy, Inc., F.R.D., 0 (D. Kan. )(when multiple parties claim ownership interests in same property, and particularly where oil leases are involved, all potential claimants must be joined to provide complete relief); see also Opening Brief at -. It is clear that the Court cannot award the United States an effective ruling on the merits of the claims here that would adjudicate and resolve the dispute unless the Osage Tribe is also a party. The Plaintiffs arguments are unpersuasive insofar as they premise their argument on an inaccurate simplification. First, the Court should disregard Plaintiff s assertion that Defendants production of an accounting will not impact the Tribe. See Response Brief at. Plaintiffs fail to appreciate that an accounting remedy will not be forthcoming unless the Court first finds some federal action contrary to law and determines that an injunction to compel an accounting is warranted. The Court would have to make such a ruling on the basis of federal action in connection with the Osage Tribe s trust account. Thus, the Plaintiffs accounting claim and accounting remedy do impact the claims and interests of the Osage Tribe because the Court cannot resolve that dispute without considering the Osage Tribe s trust account, the focal point of two pending cases in other courts, and the government s responsibilities in administering that account. Likewise, the Plaintiffs also assert that the Osage Tribe s sole interest is as the holder of two headrights, and thus its interest is identical to Plaintiffs and will not impede the complete relief --

8 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 sought in this case. See Response Brief at -. Those assertions are wholly undercut by the facts described above and in our opening brief regarding the Osage Tribe s status as the named owner of the trust account from which the United States makes the quarterly headrights payments, and the Tribe s claims regarding that account and those trust funds in its other pending cases. Plaintiffs simply cannot maintain that the Tribe s interest is a limited one in two headrights, when the Tribe s pleadings and filings in its other cases state otherwise, and the Court of Federal Claims has also found otherwise. See Opening Brief at -. Since the United States opening brief was filed, the Court of Federal Claims has issued a decision finding the United States liable to the Osage Tribe in certain respects. Osage Tribe v. United States, Fed. Cl. (00). In its decision, that Court expressly noted that the Osage Tribe asserted claims challenging disbursements from its accounts, thus refuting Plaintiffs assertion here that the Osage Tribe s only interest is as an owner of a headrights interest. See Osage Tribe, Fed. Cl. at, n. ( The parties agreed, and the court so ordered, to delete from Tranche One the trial of alleged breaches by the government of any fiduciary duty in regard to the treatment of Osage trust funds that have been segregated for disbursement. ) The Court of Federal Claims will adjudicate the Osage Tribe s disbursement claims in Tranche Two of that bifurcated case. Id. Plaintiffs also argue in conclusory fashion that the complete relief sought in this case could result in only a windfall for the Osage Tribe or a preservation of the status quo. See Response Brief at -. This reasoning is flawed because this Court may very well reject both the Plaintiffs and Defendants readings of the 0 Osage Act and adopt a different interpretation stripping the Osage Tribe of the right to receive quarterly headrights distributions or of headrights interests. This possibility is illustrated by the Plaintiffs th prayer for relief which seeks an order compelling the defendants to prospectively distribute trust property from the Section Royalty payments only to Osage Indians, defined as a person who descends from those persons named in the rolls of members prepared under section of the 0 Act. See First Amended Complaint at. Thus it is possible that the Osage Tribe (or any of the owners in Osage headrights) may wind up with less --

9 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 coming out of this lawsuit than they have at present. The Plaintiffs seek to have the United States account for, and then modify its practices in disbursing Osage trust funds. The Osage Tribe plainly has an interest in the grant or denial of that relief given its pending suits elsewhere and its position as beneficiary of the trust account from which the quarterly disbursements are made. To hold otherwise would thwart the effective and complete adjudication of the dispute and give short shrift to the interests of judicial economy by permitting multiple lawsuits involving the same subject matter and potentially inconsistent verdicts. The Court should find the Osage Tribe a necessary party under Rule (a)(). B. The Osage Tribe is also a Necessary Party under Rule (a)(). The second and third circumstances under which the Osage Tribe may be found a necessary party are set forth in Rule (a)(). Both provisions of Rule (a)() have a common preliminary requirement that the person under discussion must claim an interest relating to the subject of the action. Under subparagraph (a)()(i), a person may be so situated that the disposition of the action in the person s absence may as a practical matter impair or impede the person s ability to protect that interest. Fed. R. Civ. P. (a)()(i). Alternatively, under subparagraph (a)()(ii) the person may be so situated that the disposition of the action in the person s absence leaves any of the persons already parties subject to a substantial risk of incurring double, multiple, or otherwise inconsistent obligations by reason of the claimed interest. Fed. R. Civ. P. (a)()(ii). Both of these provisions are met here.. The Osage Tribe claims an interest relating to the subject of this action. Plaintiffs premise much of their opposition on the incorrect premise that the Osage Tribe is a Section interest holder, nothing more, nothing less. See Response Brief at &. They also wrongly assert that the Tribe s accounting and funds mismanagement claims do not seek any relief (either in the form of damages, an accounting or other injunctive relief) with regards to disbursements from the Osage trust account. See Response Brief at to. The Plaintiffs are wrong on both counts as a factual matter. As set forth in our Opening Brief at pages to and described --

10 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 above, the Plaintiffs assertions are precisely contrary to the findings of the Court of Federal Claims and the Tribes own allegations and arguments which make clear that the claims overlap. The Osage Tribe challenges disbursements from the Osage trust account and also seeks an accounting and other equitable relief regarding disbursement transactions. See Exhibit, (Tribe s Complaint in D.D.C. case no 0-, seeking an accounting, inter alia, of the Osage trust funds, including the allocation and disposal of such assets as well as a declaration of trust duties). / The Osage Tribe expressly claims an interest in the administration of Osage trust funds, including disbursements to headrights owners, and disavows the ability of an Osage headrights owner to represent the interests of the Osage Tribe. See Opening Brief at pp -. Against such specific evidence of the Osage Tribe s claim to an interest in the Osage trust funds and their disbursement (such as explained in our Opening Brief at p. to and above), the Plaintiffs argue such a contention is frivolous. Plaintiffs argument must be rejected because the Court of Federal Claims has found that the Osage Tribe has Article III standing to pursue its claims of trust funds mismanagement. Osage Tribe v. U.S., Fed. Cl., (00). A finding that a party has Article III standing necessarily includes a determination that the party has a legally protected interest. Lujan v. Defenders of Wildlife, 0 U.S., 0 (). The CFC s decision on standing is sufficient support for a conclusion that the Osage Tribe s claimed interest in the Osage trust account, and disbursements therefrom, is not frivolous for purposes of analysis under Rule. The Court is also obligated to reject the Plaintiffs assertion that the Osage Tribe is not a necessary party under Rule (a)() because its interests is aligned with the Plaintiffs as headrights owners. See Response Brief at. As recited above, the Osage Tribe and Court of Federal Claims have both explicitly rejected that notion. Also, as explained above, it is not the case that the Osage / The Court of Federal Claims characterization of the Osage Tribe s allegations: The mismanagement is not alleged to take place at the point of distribution of the funds to the individual headright holders, is incorrect as the Tribe does presently challenge trust account disbursements in the CFC action (i.e. the disbursement lag issue), and also does make a specific challenge to disbursements and trust fund allocations in its District Court action (which postdate the CFC s discussion in 00). Osage Nation v. U.S., Fed.Cl. at ; See infra at pages and. --

11 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 Tribe s interests are necessarily aligned with those of the Osage Indians in the Plaintiffs putative class. The Tribe and the Osage Indians are each treated differently in the 0 Osage Act, as amended, thus leading to the possibility of different outcomes and argument for each in this litigation. In briefing this issue, the Plaintiffs have given short shrift to the Osage Tribe s arguments presented in its own cases, thus demonstrating that Plaintiffs cannot adequately represent the interests of the absent Tribe. In a crystal example of the different interests of the Plaintiffs and the Tribe, the Plaintiffs argue that the Osage Tribe lacks sovereign immunity, and may be an agent of the United States in this case, an argument which surely meets with the disapproval of the Tribe given the Tribe s prior statement that an action by headrights holders such as this ought not to proceed. See Response Brief at - and Opening Brief at to. All of the foregoing factors support a conclusion that neither Plaintiffs nor the United States have interests in this litigation that are virtually identical to the Osage Tribe s interest, such that they can be said to adequately protect the Osage Tribe s articulated interest in the Osage trust funds.. The Osage Tribe is a necessary party under Fed. R. Civ. P. (a)() because disposition of this case will either impede the Tribe s claimed interest or subject the United States to risk of double or inconsistent obligations. Apart from the arguments already addressed above, the Plaintiffs do not offer any detailed rebuttal of our argument that a disposition in this case will either impede the Tribe s claimed interest (thus satisfying Rule (a)()(i)) or subject the United States to a risk of double or inconsistent obligations (thus satisfying Rule (a)()(ii)). Assuming arguendo the Plaintiffs claim for an accounting were viable, the Defendants would seek a determination that the provision of periodic statements of account to the Osage Tribe for the Osage trust account pursuant to U.S.C. 0(b) satisfies the accounting duty owed to either the Tribe or the Plaintiff tribal members in this case to account for particular disbursements. That such a ruling might issue from this Court prior to litigation of the issue in the pending district court action by the Osage Tribe certainly should impede the Tribe s ability to pursue that claim in a parallel forum. Conversely, the United States faces a tangible risk of double or inconsistent obligations by reason of the Osage Tribe s other pending cases raising similar claims. See Opening Brief at -. Plaintiffs sole response to this issue is the statement that the accounting sought by Plaintiffs is not --

12 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 the accounting sought by the Tribe in other litigation... Plaintiff Class can obtain its accounting and additional relief flowing from that accounting without the Tribe being present. See Response Brief at. This position cannot be squared with the fact that Tribe and Plaintiffs both necessarily challenge prior Interior Department statements of account, and demand further, more detailed accounting of the disbursements made from the Osage trust account for the quarterly headrights payments. The Plaintiffs and Tribe s stated desire to have the United States restate those transactions (and redirect the funds associated with those transactions) creates a risk of double or inconsistent obligations for the United States. In a worst case scenario, the United States is at risk of having to comply with the declaration of trust duties sought in the Osage Tribe s district court case as well as the Plaintiff s requested order that the United States must distribute trust property from the Section Royalty Payments only to Osage Indians. See First Amended Complaint at. Given the obvious problems posed by competing lawsuits involving the same funds and Osage headrights management functions, this Court should reject the Plaintiffs conclusory and baseless arguments and find the Osage Tribe to be a necessary party to the present lawsuit under Fed. R. Civ. P. (a)(). C. The Osage Tribe Is Also an Indispensable Party under Rule (b). The Plaintiffs arguments as to why the Osage Tribe is not an indispensable party in large part repeat the arguments we address above and should be rejected for the same reasons. The Plaintiffs here again rely on the incorrect assertion that the Osage Tribe s only claimed interest in the Osage trust funds is as a headrights owner. We have noted above how the Tribe claims a broader interest and how its interests could be adversely affected by a judgment in this case, either by running contrary to the accounting it seeks or by depriving it of a right to quarterly headrights revenues. Plaintiffs also fail to address the risks posed to the United States in defending suits brought by the Osage Tribe and Plaintiffs here involving essentially the same subject matter. To the extent the Plaintiffs even address the Tribe s other pending suits, the Plaintiffs mischaracterize the Tribe s other cases as raising completely separate and distinct claims. A comparison of the Complaints, filings and rulings in the Tribe s cases readily reveal the overlap with the claims in this case. See Opening Brief at to. --

13 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 Plaintiffs also argue that they will be deprived of a forum or remedy should this case be dismissed. Setting aside that the Plaintiffs claims lack merit, claims seeking further accounting, a declaration of trust duties and damages for funds mismanagement are being pursued in other forums by the Osage Tribe. Plaintiffs are presumably members of the Osage Tribe, and that Tribe has a demonstrated interest in pursuing any valid claim regarding the Osage trust funds. Further, Plaintiffs should not be heard to complain about a lack of remedy or forum unless they have at least sought to assert their interest in other courts where those actions are pending. Plaintiffs also fail to address the importance of tribal sovereign immunity in the analysis of whether the Osage Tribe is an indispensable party. Our opening brief discussed the importance the Tenth Circuit places on this factor in indispensable party analysis. See Opening Brief at p. -. The Plaintiffs argue that the Osage Tribe lacks sovereign immunity. This argument founders at the outset in failing to address the prior th Circuit decision in Fletcher v. United States, F.d, n. (th Cir. ), holding that the Osage Tribe possesses sovereign immunity. The case Plaintiffs do cite, Alfred L. Snapp & Son, Inc. v. Puerto Rico, U.S. (), does not actually address tribal sovereign immunity or stand for the proposition that such immunity is waived in cases dealing with tribal property. Plaintiffs also cite Wolfchild v. United States, Fed.Cl., (00), for the proposition that tribal sovereign immunity is no bar to suit where the Tribe acts as agent of the United States. The Wolfchild decision is not persuasive, given that it is an unreported, interlocutory decision, and thus of no precedential value. Its reasoning may also be rejected. None of the cases cited therein actually applied the novel theory of waiver of sovereign immunity by implication adopted in Wolfchild and advanced by Plaintiffs here. The rule adopted in Wolfchild is contrary to the wellaccepted rule that a waiver of tribal sovereign immunity may be found only in an unequivocally expressed waiver by the Tribe or abrogation by Congress. Fletcher, F.d at. The Plaintiffs arguments regarding tribal sovereign immunity present no basis for this Court to decline to accord the Osage Tribe sovereign immunity to the present lawsuit and to find the Tribe to be an indispensable party under Rule. --

14 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 D. Rule Is Not Inapplicable Merely Because Plaintiffs Allege a Putative Plaintiffs Class Action under Rule. Plaintiffs also argue that the joinder provisions of Rule discussed above are not applicable in this case because Plaintiffs have sought to certify a class under Rule, and that when Rule and Rule (governing actions) both apply to a case, Rule controls. See Response Brief at. The Plaintiffs argument lacks merit because its interpretation of Rule (d) is neither a persuasive interpretation of the text of the Rule nor in accord with the most recent caselaw construing this provision. First, Rule (d) states only that this rule is subject to the provisions of Rule. This language does not actually say that Rule is wholly inapplicable if a case is a putative class action. The plain text indicates only that in the event of a conflict in the application of both rules, would Rule control. This interpretation is supported by the decision of the Ninth Circuit in Shimkus v. Gersten Companies, F.d, (th Cir ). In that case, the Ninth Circuit held that Rule (d) simply requires us to respect the language of Rule, but allows joinder to the extent its use does not conflict with Rule 's provisions. Id., F.d at. That is the case here, where the Rule issues identified by the Plaintiffs have no bearing on the joinder issues discussed above. First, the central joinder issues discussed above are that the Osage Tribe claims an interest in headrights distributions beyond that of an Osage headrights owner, and has filed several suits in other courts seeking to advance claims similar to those advanced in this case. Including the Osage Tribe as a class plaintiff in this case will not resolve the Tribe s presently pending other lawsuits. / / Plaintiffs bid to include the Osage Tribe in its putative plaintiffs class without any affirmative consent of the Tribe is not a permissible use of Rule because it runs afoul of Rule, which states that these rules shall not be construed to extend... the jurisdiction of the United States district courts. Fed. R. Civ. P.. Inclusion of a tribe in a putative plaintiffs class amounts to an unauthorized waiver of tribal sovereign immunity because it would have the effect of subjecting the Osage Tribe to the jurisdiction of the Court. Neither the Court nor Plaintiffs have the authority to waive tribal sovereign immunity; and to hold otherwise would improperly extend the jurisdiction of this Court over the Osage Tribe. Neither of the cases Plaintiffs cite as support for inclusion of a tribe in a class action hold otherwise or are on point. In Blake v. Arnett, F.d 0, (th Cir. ), the Court actually found that the Tribe (as distinct from tribal members) had sovereign immunity and was neither a party nor bound by the judgment. Likewise, in Cherokee --

15 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 Plaintiffs also argue that the Court may permit the Tribe to opt-out of any class action in the exercise of its discretion under Fed. R. Civ. P. (d)(). But whether or not that reading of Rule is correct, supplying an opt-out right to the Tribe under Rule (d)() would only defer consideration of the question posed under Rule, whether this case ought to proceed given the pendency of the Osage Tribe s cases filed years before the Plaintiffs alleged the present accounting and breach of trust claims in this case. In any event, the entire premise of this argument regarding Rule (d) is that the Osage Tribe is included as a member of the putative Plaintiffs class. That premise cannot be accepted, as neither the First Amended Complaint nor the Plaintiffs Motion for Class Certification (docket #) include the Tribe in the Plaintiffs class. The named Plaintiffs to this action do not include the Osage Tribe. Neither the class allegations in Plaintiffs First Amended Complaint nor their Motion for Class Certification expressly include the Osage Tribe as a member of the Plaintiffs class. Critically, the Plaintiffs class allegations can only be read to exclude the Osage Tribe from the Plaintiffs class. The alleged class in this case is all Osage Indians who lawfully receive distributions of trust property.... See First Amended Complaint at. And paragraph of the First Amended Complaint states that [a]n Osage Indian is a person who descends from those persons named in the rolls of members prepared under section of the 0 Act. This definition of an Osage Indian necessarily excludes the Tribe from its ambit. The Motion for Class Certification goes even further in restricting the class by describing it as comprised of Osage Indians by blood or their heirs, defining heirs narrowly as Osage Indians, their spouses, their legally adopted children, and Indians by blood. See Motion for Class Certification at &. / There is no basis for Nation v. United States, F.R.D., (E.D. Okla. 00), the Court there decided not to certify a class of tribes and its decision in no way can be read to stand for the proposition stated by Plaintiffs that the Court had no problem with the concept of tribes as class members. / On October, 00, Plaintiffs inquired whether Defendants would oppose a motion to amend the complaint. Plaintiffs proposed Amended Complaint added certain allegations that would expressly include the Osage Tribe as a putative class member, but not as a named Plaintiff. But the Plaintiffs have not sought leave to file that (or any) proposed Second Amended Complaint, and this Court is obligated to rely on the pleadings as of the date of this filing. --

16 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 the Plaintiffs assertion that the Osage Tribe is a member of the Plaintiffs putative class in this case. Rule (d) does not apply to the situation in this case. Plaintiffs have identified no conflict in operation of rules and. Acceptance of Plaintiffs argument would only delay resolution of the very issue the Court of Appeals has directed to be the first order of business this Court takes up on remand. II. Non-Osages are Necessary and Indispensable Parties. The Plaintiffs argue that the persons owning Osage headrights, but not included in the putative Plaintiff class, are not necessary or indispensable to the resolution of this case because their interests will be adequately represented and their arguments advanced by either the Plaintiffs or the United States, depending on the issue. This reasoning does not stand up to scrutiny because it presents an overly simplified version of the issues presented in this case. As to the accounting claim, the Plaintiffs argue that all the owners of Osage headrights are similarly situated as the Plaintiffs, and that their presence is not required to prepare an accounting. A proper understanding of the accounting Plaintiffs seek demonstrates the potential for differences to emerge between individual headrights owners. Each headrights holder will have a stake in the accounting which is distinct and adverse to all the other headrights holders, as the accounting demanded by Plaintiffs is not just any accounting, let alone one required by federal law. Plaintiffs have premised their accounting claim on U.S.C. 0. See First Amended Complaint. The text of that statute is plain. It requires production of a quarterly statement of performance which identifies: () the source, type and status of the funds; () the beginning balance; () gains and losses; () receipts and disbursements; and () the ending balance. / Assuming arguendo Plaintiffs / Defendants reserve all arguments as to the merits of the accounting claim, including whether any of the named Plaintiffs are entitled to a periodic statement of performance under U.S.C. 0(b). There is no basis in the text of U.S.C. 0 or otherwise for Fletcher s claim that any one headrights owner (apart from the Osage Tribe) is entitled to a statement of account detailing the disbursements made to other headrights owners. Federal law and the Interior Department have long maintained that the mineral income is held for the Tribe until it is segregated for distribution to individual headrights owners. See e.g. Act of October,, (b), Pub. L. No. -, Stat., () and See also Op. Solic. Dep t Int. Ind. Affairs, ()(attached as Exhibit ). --

17 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 prevail in the accounting claim and can compel production of an accounting under this statute, the account statement would likely merely detail the date and amount of the quarterly annuity payment (i.e. a statement of transactions). But Plaintiffs plainly demand that the accounting go further and determine whether Section Royalty Payments distributed from the Osage Mineral Estate have been distributed only to Osage Indian as required by Section of the 0 Act, as amended. See First Amended Complaint at. Setting aside whether Plaintiffs have any right to this relief, a determination of the legal status of each recipient of a quarterly headrights distribution is not an accounting of funds. Rather it is an examination of the chain of title and predecessors in interest to each of the headrights owners at a specific point in time, as well as an examination into the present and past owners specific Indian tribal ancestry. Obviously, all owners of a headright have their own peculiar interest in the accuracy of the accounting sought by Plaintiffs insofar as that accounting would set forth the basis for each individual right to an Osage headright. The accounting would potentially affect their title to an Osage headright and consequent entitlement to a quarterly headrights distribution. Each headrights owner will thus have a distinct interest adverse to that of the named Fletcher plaintiffs. And each owner may also take issue with the United States evidence for each headright interest. Thus, each of the headrights owners have separate interests potentially prejudiced in the accounting phase. And the Court will not be able to grant the complete accounting relief sought without the participation of these individual headrights owners. Likewise, Plaintiffs description of their breach of trust and mismanagement claims is too simple. They state that the 0 Act required, and continues to require, the Section Royalty payments to be made only to the Osages or their lawful heirs as those terms are defined within the Act. See Response Brief at 0. But that statement just begs the question of how Plaintiffs define lawful heirs. Until Plaintiffs answer to that question is adequately spelled out, neither this Court, the Defendants, nor any non-osage headrights owners can possibly determine the precise controversy here, or their views on it. One cannot even determine if Plaintiffs concede that there might be a present Osage headrights owner who is not within Plaintiff s proposed class, but who yet --

18 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 lawfully receives a quarterly headrights payment. In light of the indefiniteness of Plaintiffs claim, their blanket statement that all non-osage headrights owners will be adequately protected by the United States arguments lacks any basis, especially as the Plaintiffs breach of trust claims will require determination of factual questions regarding any one person s rights to a headright as well as interpretations of individually relevant materials such as state court probate decrees. Plaintiffs failed to address our arguments that claims seeking to terminate property rights typically require joinder of those whose interests are sought to be extinguished. See Opening Brief at to. Nor did they address the argument that failing to name such individuals pursuant to Rule (c) permits a finding that joinder is infeasible. Finally, Plaintiffs ignore the prospect of multiple litigation against the United States should Plaintiffs prevail. For the foregoing reasons, the Court should find the non-osage headrights owners to be necessary and indispensable parties. III. The Statute of Limitations Fully Applies to Any Challenge to An Ownership Interest in an Osage Headright. Plaintiffs respond to the argument that the claims presented in their First Amended Complaint are time barred by claiming that the statute of limitations is inapplicable because their claims come within the scope of an Interior appropriations rider suspending the statute of limitations for claims such as theirs. Plaintiffs arguments are misplaced for two reasons. First, to the extent they seek to challenge United States actions in review or approval of transfers in ownership of an Osage headright interest, that claim is not for the loss or mismanagement of trust funds within the scope of the appropriations rider and is instead governed by the ordinary rules of claims accrual. Likewise, a demand for an accounting is not within the scope of the rider. Second, the appropriations rider may not be construed to revive claims which were stale and time barred in 0 upon the first enactment of the appropriations rider. Plaintiffs base their position on a provision contained in every Department of the Interior appropriations bill since 0, with minor changes in and, that provides in substantial part: That notwithstanding any other provision of law, the statute of limitations shall not commence to run on any claim, including any claim in litigation pending on the date of the enactment of this Act, concerning losses to or mismanagement of trust funds, until the --

19 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 affected tribe or individual Indian has been furnished with an accounting of such funds from which the beneficiary can determine whether there has been a loss. Consolidated Appropriations Act of 00, Pub. L. No. -, Stat. 0, 00-. Legislative history indicates this provision was meant to "protect the rights of tribes and individuals until the reconciliation and audit of their accounts has been completed." H.R. Rep. No. - (). Contemporaneous with the rider s initial enactment in 0, the legislative history provided: The Committee has also included language which will extend the statute of limitations with relation to Indian trust fund management. Since the audit and reconciliation of such funds, as directed by the Committee, will require at least years to complete, it is possible that the statute of limitations for any significant discrepancies uncovered during this process may have expired by the time such audits are completed. Therefore, the Committee has agreed to provide this extension in order to protect the rights of the tribes and individuals involved should such protection prove necessary. S. Rep. No. - (0)(relating to the initial enactment in 0). A. Any Claim Challenging the United States Decision as to the Proper Ownership of a Headrights Interest Is Time Barred. Neither the demand for an accounting nor the breach of trust claim fit within the scope of the appropriations act rider on which the Plaintiffs rely because the provisions setting aside the statute of limitations until an accounting is provided apply only to cases of trust fund mismanagement, not asset mismanagement or demands for an accounting. Shoshone Indian Tribe of the Wind River Reservation v. United States, F.d, 0 (Fed. Cir. 00). As Shoshone found, the text of the appropriation rider specifically limits its application to the mismanagement of trust funds. Stat. at 00. This case, however, deals with the alleged mismanagement of trust assets. Further, the government's consent to be sued - and the rider provisions here - must be strictly construed in favor of the sovereign and not enlarged beyond what the language requires. See United States v. Nordic Village Inc., 0 U.S. 0, (). The Court should dismiss any claim challenging headrights ownership or for an accounting for lack of subject-matter jurisdiction. The Plaintiffs make two claims in this case - a demand for a Section Royalty Interest accounting and a claim that the United States improperly alienated Osage headrights to persons and entities other than those permitted under the 0 Act. See Response Brief at. Plaintiffs original complaint also challenged the alienation of headrights interest to non-osages. See Fletcher v. --

20 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page 0 of 0 United States, Fed. Appx., (th Cir. 00)(describing claims in original complaint). However, in Plaintiffs First Amended Complaint, they repackaged that claim as a challenge to the distribution of quarterly headrights payment to non-osages. This new claim is no different than their challenge to the alienation of headrights because establishing that a quarterly headright disbursement was improper under Plaintiffs theory will necessarily turn on a conclusion that the Department of the Interior erred in approving a transfer of ownership in a particular headright to a non-indian under the 0 Osage Act. Federal law provides that ownership of a headright entitles the owner thereof to a quarterly headrights payment pursuant the 0 Osage Act. See Opening Brief at to and to, See e.g. Act of October,, (a), Pub. L. No. -, Stat., (referred to as the Act ) ( Any individual right to share in the Osage mineral estate (commonly referred to as headright ) owned by a person not of Indian blood may not, without the approval of the Secretary of the Interior, be sold, assigned or transferred. ) Ownership of an Osage headright is a property interest. See Exhibit and Estate of Shelton v. Oklahoma Tax Comm n., P.d, - (Okla. ). And, as described by the Solicitor for the Department of the Interior in, the Department of the Interior has long recognized transfers in ownership of a headrights interest upon receipt and review of final probate decrees (as probate is the predominant forum for headrights transfer). / See Exhibit at 0. Plaintiffs argue that their claim concerns losses to or mismanagement of trust funds, and thus is within the scope of the appropriations rider. However, the Plaintiffs do not allege that the United States made payments to persons who did not own a headright. Rather, they challenge the right of non-osages to own a headright in the first instance. Any determination or recognition by the United States of any persons right to ownership of an Osage headright or to share in the Osage mineral estate is manifestly not a question of funds management, but rather of title to a wholly distinct / To be clear, the Department of the Interior also accepts transfer documents in lieu of probate decrees where the law of the state of domicile of a non-osage headright holder provides for such a mechanism. See Exhibit. The Department has also accepted transfers of a headright interest by non-indians where the transfers are conducted in accordance with Section of the Act or as amended by the Act of October 0,, (f), Pub. L. No. -0, Stat. (). --

21 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 property interest - an Osage headright. Though Plaintiffs may nominally challenge a quarterly headrights distribution, they should not be permitted in the guise of such a claim to challenge the underlying right and title to a headright without regard to the ordinary statute of limitations. This interpretation of the appropriations Acts finds support in their text, legislative history, and relevant caselaw. First, the text of the rider specifically limits its application to the mismanagement of trust funds. A claim that an Osage headright has been conveyed to an ineligible person under the 0 Osage Act obviously requires evidence of that person s Osage and or other Indian lineage and other facts, as well as a separate legal determination as to whether the conveyance is proper. Any error made in that agency action does not involve the handling of funds, and thus is not embraced within an ordinary reading of the text of the appropriation Acts. Likewise a claim the United States has failed to account in detailing or determining the ownership of headrights also does not concern the management of funds and is outside the scope of the Act. Nor does the plain language of the appropriations Acts toll or suspend the statute of limitations for the specified accounting itself, insofar as Congress has enacted a separate provision extending limitations provisions for Tribal (but not individual) claims relating to challenges to reconciliation reports for Tribal accounts. See, e.g., Pub. L. No. -, Stat. (00) (codified at U.S.C. 0 note). The legislative history quoted above also supports this reasoning. The purpose of the appropriations riders was to preserve claims for discrepancies that might be revealed by a reconciliation and audit of various trust accounts. The specific audit and reconciliation requirements referenced in the legislative history quoted above were enacted into law by the American Indian Trust Fund Management Reform Act of, Pub. L. No. -, Stat. (referred to as the Reform Act). These audit and reconciliation requirements apply generally to all tribal and Individual Indian Money trust accounts, but not other classes of trust property. The Reform Act does not include any requirement that can be construed to require a reconsideration of the ownership of Osage headrights. The audit requirement is found at U.S.C. 0(c), and applies only to funds held in trust. The reconciliation requirement is found at U.S.C. a(d)(), and is required to assure the accuracy of accounts. See also U.S.C. 0(b) (requiring periodic --

22 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 statement of performance); U.S.C. 0(b)()(A)(accounting due to account holders ); and U.S.C. 0 (reconciliation report for each tribal trust fund account ). The foregoing description of provisions in the Reform Act demonstrates that the scope of the appropriations riders was linked by its drafters to specific remedial funds management measures specified in the Reform Act. / And, because neither an audit, reconciliation, nor accounting under the Reform Act calls for a reconsideration of the ownership of Osage headrights, the rider should not be construed to embrace a claim challenging the Department of the Interior s actions in determining ownership of a headright. It is important to understand that the roll of Osage headrights owners served purposes, and has legal significance beyond generating a list of recipients for quarterly headrights distributions. For example, prior to enactment of Pub. L. No. - in 00, only Osage Indians who owned a headright were considered members of the Osage Tribe eligible to vote in Osage government elections. See An Act to Reaffirm the Inherent Sovereign Rights of the Osage Tribe, (a), Pub. L. No. -, Stat. 0 (00). And each Osage Indian owning a headright had a vote equivalent to his or her headrights share. See C.F.R. 0. & 0. (list of voters in Osage election drawn from quarterly annuity roll at the Osage Agency as of the last quarterly payment immediately preceding the date of election. ) Obviously, the statute of limitations for challenging the quarterly annuity roll at the Osage Agency was not suspended with regard to its central function in determining the membership of the Osage Tribe or the tribal members respective voting rights. The claim here is no different. The Plaintiffs should not be permitted to challenge the same quarterly annuity roll under the guise of making a claim ostensibly concerning funds. Finally, the decision of the Federal Circuit Court of Appeals in Shoshone Indian Tribe v United States, F.d (Fed Cir. 00), supports our argument. The Court of Appeals there held that not every action that results in a loss to the trust is included within the scope of the Act, / Plaintiffs argue erroneously that the Defendants concede the United States has not provided the accounting necessary to commence the statute of limitations under the Acts. That is not the case. Such an argument and proof is merely not relevant to the argument that the claims themselves are not covered by the appropriation Acts. --

23 Case :0-cv-00-GKF-FHM Document Filed in USDC ND/OK on //00 Page of 0 based on its distinction between the management of trust funds and other trust assets. Shoshone Indian Tribe, F.d at 0. Here the trust property at issue is the right to share in the Osage tribal income, known as a headright. A headright is recognized as an interest in property separate and apart from the specific funds segregated and disbursed on a quarterly basis. The Court of Appeals also supported the distinction between trust funds and other trust assets by noting that an accounting alone will not reveal the mismanagement of trust assets because an accounting of trust funds is limited to a financial statement of receipts, expenditures, losses and gains. Id., F.d at. Likewise here, the accounting contemplated by the appropriation Acts would not shed significant light on the chain of title for each headrights owner receiving a quarterly disbursement. Hence the purposes of the tolling provisions would not be served by postponing the running of the statute of limitations on claims challenging alienation of headrights on the quarterly annuity roll. Plaintiffs attempt to enlarge the scope of the appropriations Acts to include challenges to the handling and alienation of trust property beyond trust funds is contrary to any sensible reading of those Acts. The Plaintiffs challenge to the alienation of Osage headrights to non-osages should be held time barred. B. The Appropriations Rider May Not Be Construed to Revive Stale Claims. The Plaintiffs construction of the appropriations Acts would also have the effect of reviving claims for which the applicable limitations period had already expired when the first of the Acts was passed. The Plaintiffs do not dispute the fact that non-indians have succeeded to ownership of numerous Osage headrights, and that the transfers they challenge occurred more than six years prior to the filing of their suit. Their construction of the Acts would revive claims against the government that had long ago expired through lapse of time before the first of the appropriations Acts was passed. Nothing in the text or history of the Acts suggests that Congress intended that extraordinary result. Applicable canons of statutory interpretation make clear that the relevant appropriations laws may properly be construed to revive lapsed claims only if the language of the Acts unambiguously --

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