Pigford v. Glickman

Pigford v. Glickman (1999) was a class action lawsuit against the United States Department of Agriculture (USDA), alleging racial discrimination in its allocation of farm loans and assistance between 1981 and 1996. The lawsuit ended with a settlement on April 14, 1999, by Judge Paul L. Friedman of the U.S. District Court for the District of Columbia.^[1][2] To date, almost US$1 billion has been paid or credited to more than 13,300 farmers under the settlement's consent decree, under what is reportedly the largest civil rights settlement to date. As another 70,000 farmers had filed late and not had their claims heard, the 2008 Farm Bill provided for additional claims to be heard; and in December 2010, Congress appropriated $1.2 billion for what is called Pigford II, the second part of the case.^[2]

USDA discrimination against African American farmers

The USDA's discrimination against African American farmers can be traced back to when whites became increasingly fearful of competing with freed slaves. In response, the government made USDA loans dependent on credit, reducing the newly freed slaves' ability to survive. White planters used credit to gain monopolistic control of agricultural production. Also, the New Deal programs protected white farmers by shifting the risk to black tenants. During the Great Depression, black farmers lost their land by tax sale, eminent domain, and voluntary sales. The USDA admittedly discriminated against black farmers, and by 1992 the amount of black farmers had declined by 98%.^[3]

County and state USDA authorities have historically discriminated against African American farmers on the basis of race.^[4] Sometimes bluntly, for example, a USDA official would deny an equipment loan, telling the black farmer “all you need is a mule and a plow”, or telling the black farmer that the disaster relief is “too much money for a nigger to receive”.^[5] But more often, the USDA used paper-shuffling, delaying loans for black farmers until the end of planting season, approving only a fraction of black farmers' loan requests, and denying crop-disaster payments for black farmers, which white farmers got routinely.^[6]

USDA credit and benefit decisions to approve or deny farm loan applications were decided by 3 to 5 elected committee members at the county level; however, the committee members were overwhelmingly white.

• In the southeast, 1% of the committee members were African American.
• In the southwest, 0.3% of the committee members were African American.
• In the remaining regions, there was not a single African American committee member.
• Nationwide, there were only 0.45% African American committee members.

On average it took three times longer for the USDA to process a black farmer's application than a white farmer's application.^[7]

The black farmers involved in the case had all been subjected to racial discrimination and humiliation by the USDA: Mr. Steppes applied for a farm loan and it was denied. As a result, he had insufficient resources to plant crops, he could not buy fertilizer and treatment for the crops he did plant, and he ended up losing his farm. Mr. Brown applied for a farm loan. After not hearing back, he followed up and was told his loan was being processed. After not hearing back again, he followed up and was told that there was no record of his application. He reapplied, but did not receive the loan until planting season was over. Additionally, his loan was “supervised”, so he had to get a signature by a USDA official to take money out. It was routine for the USDA to make this a provision for black farmers, but not for white farmers. Mr. Hall lost his crops and was eligible for disaster relief payments. Every single application in his county was approved, except for his. Mr. Beverly applied for a loan to build a farrowing house for his swine. He was told that his loan was approved and he bought livestock in anticipation. Later, he was told the loan was denied and his livestock were useless. He ended up having to sell his property to settle his debt.^[8]

While the rules and the law were colorblind, the people enforcing them were not. The denial of credit and benefits to black farmers and the preferential treatment of white farmers essentially forced black farmers out of agriculture. African American farms were foreclosed on. African American farmers were subject to humiliation and degradation by USDA county officials. The USDA's Civil Rights office was supposed to investigate these complaints, but the USDA's records show this was functionally nonexistent for over a decade.^[9]

The USDA's Secretary of Agriculture reported that process for resolving discrimination complaints had failed. He reported that the USDA has not acted in good faith on the complaints: appeals are too often delayed and for too long; favorable decisions are too often reversed. The USDA Inspector General reported that the discrimination complaint process lacks integrity, direction, and accountability. There were staffing problems, obsolete procedures, and little direction from management which resulted in a climate of disorder. In response, in 1998, Congress tolled the statute of limitations for USDA discrimination complaints, which allowed the Pigford class to bring this suit.^[10]

Terms of the Consent Decree

Under the consent decree, an eligible recipient is an African American who (1) farmed or attempted to farm between January 1, 1981, and December 31, 1996, (2) applied to USDA for farm credit or program benefits and believes that he or she was discriminated against by the USDA on the basis of race, and (3) made a complaint against the USDA on or before July 1, 1997. The consent decree set up a system for notice, claims submission, consideration, and review that involved a facilitator, arbitrator, adjudicator, and monitor, all with assigned responsibilities. The funds to pay the costs of the settlement (including legal fees) come from the Judgment Fund operated by the Department of the Treasury, not from USDA accounts or appropriations.^[1]

Many individuals and organizations argued that the settlement in the consent decree should have included broader relief. However, the judge said that was not the test; the test is whether settlement is fair and reasonable compared to cost of trial. The judge found that the two tracks would ensure prompt distribution, while a trial would have been complicated, long, and costly. Also, the judge appointed a monitor to track and report on enforcement and court retained jurisdiction. Notably, the USDA would not include a provision that they would prevent future discrimination. The court concluded the Consent Decree represented a significant first step away from historical discrimination. The black farmers demonstrated their power to bring about change and planted a seed of change. The judge stated that it is up to the USDA to ensure this shameful period is never repeated and to bring the USDA into the 21st century.^[11]

Case history

The lawsuit was filed in 1997 by Timothy Pigford, who was joined by 400 additional African-American farmer plaintiffs. Dan Glickman, the Secretary of Agriculture, was the nominal defendant. The allegations were that the USDA treated black farmers unfairly when deciding to allocate price support loans, disaster payments, "farm ownership" loans, and operating loans, and that the USDA had failed to process subsequent complaints about racial discrimination.^[1][2]

After the lawsuit was filed, Pigford requested blanket mediation to cover what was thought to be about 2,000 farmers who may have been discriminated against, but the U.S. Department of Justice opposed the mediation, saying that each case had to be investigated separately. As the case moved toward trial, the presiding judge certified as a class all black farmers who filed discrimination complaints against the USDA between 1983 and 1997.

The Pigford consent decree established a two-track dispute resolution mechanism for those seeking relief.

The most widely used option was called "Track A".^[2] which could provide a monetary settlement of $50,000 plus relief in the form of loan forgiveness and offsets of tax liability.

Track A claimants had to present substantial evidence (i.e., a reasonable basis for finding that discrimination happened) that:

• Claimant owned or leased, or attempted to own or lease, farm land;
• Claimant applied for a specific credit transaction at a USDA county office during the applicable period;
• The loan was denied, provided late, approved for a lesser amount than requested, encumbered by restrictive conditions, or USDA failed to provide appropriate loan service, and such treatment was less favorable than that accorded specifically identified, similarly situated white farmers; and
• The USDA’s treatment of the loan application led to economic damage to the class member.

Alternatively, affected farmers could follow "Track B" procedures.^[2] Track B claimants had to prove their claims and actual damages by a preponderance of the evidence (i.e., it is more likely than not that their claims are valid). The documentation to support such a claim and the amount of relief are reviewed by a third-party arbitrator, who makes a binding decision. The consent decree also provided injunctive relief, primarily in the form of priority consideration for loans and purchases, and technical assistance in filling out forms. Finally, plaintiffs were permitted to withdraw from the class and pursue their individual cases in federal court or through the USDA administrative process.^[2]

This settlement was approved on April 14, 1999, by Judge Paul L. Friedman of the U.S. District Court for the District of Columbia.^[2]

Payouts

Originally, claimants were to have filed within 180 days of the consent decree. Late claims were accepted for an additional year afterwards, if they could show extraordinary circumstances that prevented them from filing on time.

Far beyond the anticipated 2,000 affected farmers, 22,505 "Track A" applications were heard and decided upon, of which 13,348 (59%) were approved. US$995 million had been disbursed or credited to the "Track A" applicants as of January 2009, including US$760 million disbursed as US$50,000 cash awards.^[12] Fewer than 200 farmers opted for the "Track B" process. This was reportedly the largest federal settlement for civil rights violations to date.^[13]

Beyond those applications that were heard and decided upon, about 70,000 petitions were filed late and were not allowed to proceed. Some have argued that the notice program was defective, and others blamed the farmers' attorneys for "the inadequate notice and overall mismanagement of the settlement agreement". A provision in the 2008 farm bill essentially allowed a re-hearing in civil court for any claimant whose claim had been denied without a decision that had been based on its merits.^[14]

The largest compensation as of July 2010, from the first part of the Pigford case, was the $13 million paid to the members of the defunct collective farm New Communities of Southwest Georgia in 2009; their attorney said that the value of the land of their former 6,000-acre farm was probably worth $9 million alone.^[13]

The case was decided during the Clinton administration, but the payouts were during the Bush administration. The Bush administration did not share the views of President Bill Clinton or USDA Secretary Dan Glickman and protected the government’s financial interests above recovery by farmers and worked aggressively against awarding Track A claims. Under Bush, 69% of the 22,721 eligible claims were denied. Additionally, 73,800 farmers filed claims past the deadline and were denied review. A contributing factor to the late claims were that were not enough attorneys ready to take the thousands of Track B claims, leading to errors, missed deadlines, incorrect filings, and other problems. The news media criticized the lawyers representing the black farmers, that they did not provide full, fair, and adequate representation. Animosity towards black farmers increased. Ultimately, Congress made $1.25 billion available to settle Pigford II claims, which were the late settlements. These settlements were allowed because notice to eligible claimants was “ineffective or defective”, and class counsel mismanaged the settlement.^[15]

Subsequent events

In 2004, the Black Farmers and Agriculturalists Association (BFAA) filed a US$20.5 billion class action lawsuit against the USDA for the same practices, alleging racially discriminatory practices between 1997 and 2004. The lawsuit was dismissed when the BFAA failed to show it had standing to bring the suit.

Legislative language was added to the 2008 Farm Bill to enable more farmers to bring suit and to authorize the government to negotiate additional monies for settlement. In 2010, the Administration had negotiated settlement for an additional $1.2 billion for such claims, in what is known as Pigford II.^[16] Congress appropriated the money for the settlement later that year.^[2] Successful claimaints in Pigford II had to wait until 2013 to receive their settlement awards.^[17]

Following the Pigford case, Native American farmers settled their own USDA discrimination case, the Keepseagle case, which had 2 tracks, like Pigford. Hispanic farmers, the Garcia class, and women farmers, the Love class, also experienced USDA discrimination but could not get their class actions certified and were both denied review.^[18] However, the USDA employed its own administrative claims process to help provide relief to women and Hispanic farmers.^[19]

According to GAO, as of 2009 problems resolving discrimination complaints at the USDA persisted. USDA employees undermined civil rights claims with faulty data. Complaints were not properly investigated, and decisions were mismanaged and lacked integrity, giving rise to more discrimination complaints and a surge in the amount of backlogged complaints. The USDA's reports on minority participation were therefore unreliable and of limited usefulness; strategic planning is limited and lacks needed components. Lessons learned could benefit USDA’s civil rights performance: an oversight board could improve management, and an ombudsman could address concerns of USDA customers and employees.^[20]

Since the USDA’s civil rights program expanded, the face of agriculture changed:

• African American farms grew 9%; African American farm operators grew 7%; African American women farmers grew 53%
• Native American farm operators grew 88%; Native American women farmers grew 318%
• Hispanic farm operators grew 14%; Hispanic women farmers grew 20%^[21]

Overall, women farm operators grew 19%. Women farm operators were the most likely to own the land they farmed and were the most racially diversified.^[22]

Allegations of fraud

In April 25, 2013, the New York Times reported that "the $50,000 payouts to black farmers had proved a magnet for fraud" and that "its very design encouraged people to lie".^[23]

Some of the specific examples cited in the April 25, 2013 New York Times article included:

• "Reams of suspicious claims, from nursery-school-age children and pockets of urban dwellers, sometimes in the same handwriting with nearly identical accounts of discrimination"
• "In 16 ZIP codes in Alabama, Arkansas, Mississippi and North Carolina, the number of successful claimants exceeded the total number of farms operated by people of any race in 1997, the year the lawsuit was filed. Those applicants received nearly $100 million"
• "In Maple Hill, a struggling town in southeastern North Carolina, the number of people paid was nearly four times the total number of farms."
• "In Little Rock, Ark., a confidential list of payments shows, 10 members of one extended family collected a total of $500,000, and dozens of other successful claimants shared addresses, phone numbers or close family connections."
• "In Arkansas, prosecutors rejected a test case against a Pine Bluff police officer who had admitted lying on his claim form."
• "In one ZIP code in Columbus, Ohio, nearly everyone in two adjoining apartment buildings had filed, according to the former high-ranking agency official."
• "She cinched the claim, he said to a ripple of laughter, by asserting that her father had whispered on his deathbed, 'I was discriminated against by U.S.D.A.'"

The Federation of Southern Cooperatives/Land Assistance Fund responded with a Press Release Titled “‘Sharon LaFraniere got it Wrong!’ Response to the coverage of the Pigford Settlement in the April 26, New York Times”^[24]

See also

• List of class action lawsuits
• New Communities
• Resignation of Shirley Sherrod

References

External links

• Cowan, Tadlock (2010-04-21). "The Pigford Case: USDA Settlement of a Discrimination Suit by Black Farmers". Congressional Research Service. Archived from the original on 2010-04-21.