USDA Under FireBy Andrew Harris, Staff Reporter, National Law Journal, November 3, 2003. ABSTRACT A series of class actions have been filed against the Department of Agriculture by American Indian, Latino and female farmers, each alleging that the USDA is unwilling to lend money to them on the same terms it offers to white male farmers. The article discusses four class actions including Pigford v. Glickman, NO. 97-1978 (D.D.C.) and Keepseagle v. Veneman, No. 99-03119 (D.D.C.). In Pigford, black farmers settled for more than $1 billion in what the article describes as a confusing and complicated two track settlement procedure whereby class members choose a Track A or Track B recovery. The article highlights viewpoints from all sides that conclude that the Pigford settlement does not provide a useful model for future settlements, including a potential settlement in Keepseagle. Joe Sellers, a partner at Cohen, Milstein, Hausfeld & Toll, P.L.L.C., was interviewed for the article and his comments about the USDA's civil rights office and his intention to file an application for a court-ordered stay to preserve the status quo as the case proceeds are highlighted in the excerpt below. According to Sellers, one major difference between Pigford and Keepseagle is that in Pigford, the USDA had agreed to a voluntary stay of its foreclosure activities against members of the class. A temporary stay of foreclosure activities with respect to the class members in Keepseagle expired in January 2001. EXCERPT Three years ago, the USDA entered into a $1 billion settlement with a class of more than 15,000 African-American farmers who made the same allegations. In April, the agency installed its first-ever assistant secretary for civil rights, attorney Vernon B. Parker, 43. Despite the settlement and the new hire, the plaintiffs' lawyers also say that the agency's overall attitude toward minority farmers is more hostile now than it was six years ago. Then under the leadership of Secretary Dan Glickman, in 1997 the USDA released its first civil rights action team report, saying the agency has a long history of civil rights failings and promising improvement. Upon the release of the report, Glickman said, "I'm not here to point fingers or to cast blame. I'm here to say it's time to heal. We cannot change the past but we can and will set a new course for the future of this department." In a telephone interview, Parker conceded that altering the culture and public perception of an agency created during the Lincoln administration will be difficult. "The problems did not occur overnight, nor are they going to change overnight," he said. The agency is often thought of as "the last plantation," he said. "We want to be known for other things." One of the USDA's missions is to provide financial aid to family farmers whose cash flow is often at the mercy of frosts, storms, droughts, bugs and blights that destroy crops, kill livestock and upset balance sheets. This is done through the USDA's Farm Service Agency. Its lending practices are at the core of the lawsuits. David Frantz, a partner in Washington's Conlan, Frantz, Phelan & Pires, called the USDA "the lender of last resort." He explained that a farmer seeking to borrow money from the agency must first show that he or she was unable to get a loan from a private lender. "The USDA is the lender for beginning farmers and the lender for poorer farmers," Frantz said. To get a loan, a farmer must apply to a county board comprised of neighbors. In deciding, they can consider subjective intangibles such as good character. Consequently, it's alleged, tens of thousands of minority farmers have been denied loans that they were otherwise qualified for, or given loans on terms less favorable than those given their white male counterparts. Others still were allegedly subjected to inordinate delays in loan-application processing, denied assistance in filling out forms or refused applications altogether. Compounding the problem, in 1984, the USDA lost funding for its civil rights office and abandoned thousands of filed complaints. "It was a mess," said civil rights lawyer Joseph M. Sellers. Sellers, a partner at Washington's Cohen, Milstein, Hausfeld & Toll, is one of the lead counsel for a certified class of American Indian farmers believed to comprise more than 15,000. Keepseagle v. Veneman, No. 99-03119 (D.D.C.). Frantz said that his clients are among the country's poorest farmers, with 70% of them grossing less than $50,000 in revenue per year. "They are the class," he said. "These are the farmers that the USDA was designed for." It took an act of Congress, in 1998, to restore the rights of minority and women farmers. Under that act, which Frantz said had broad bipartisan support, the statute of limitations was extended so farmers who had filed civil rights complaints with the USDA between Jan. 1, 1981, and July 1, 1997, could participate in one of the suits. The Keepseagle class closed in 1999, when that complaint was filed. In a telephone interview, Sellers said that he will seek an extension of time to file because the agency's offensive practices have continued to the present. |
