TULSA, Okla. - The proverbial curtain of Oz could be pulled back if a federal judge allows the plaintiffs in the Fletcher v. United States case to conduct discovery into the accounting and ownership of Osage headrights.
The case went before Federal Judge Gregory Frizzell in the U.S District Court for the Northern District of Oklahoma after it got kicked back from the 10th Circuit Court of Appeals.
Judge Frizzell set a status scheduling session for March 6 at 9:30 a.m. to consider whether he will allow discovery, allow a court appointed expert or special master to do an accounting, and consider whether or not to make the case a class action lawsuit.
The 12-year-old case got new life after the 10th Circuit ruled Sept. 13, 2013, that Osage Nation members William Fletcher and Charles Pratt are entitled to an accounting from the United States’ management of Osage oil and gas royalties. The court rejected the government’s argument that its duty to provide an accounting extended only to the Osage Nation. The court reasoned the trust relationship exists for the benefit of individual Osage headright holders and they are entitled to an accounting of funds.
“The curtain of Oz is about to fall down,” said lead attorney Jason Aamodt, for the Fletcher plaintiffs. “They don’t have any accounting records to show us.”
Information gathered by attorneys throughout the years has been specious at best for the Fletcher plaintiffs. Amanda Proctor, an attorney for the case, said there are numerous examples of inept record keeping and she has found deception and thievery of Osage headrights in various archives.
“That is the message we need to get out to people. We need those Osage headright holders to come forward who have lost their headright, or know of a living family member who has lost their headright, by unlawful means,” she said.
The case was filed in 2002 by Fletcher, Pratt, John Berrey, the late Juanita West, Cora Jean Jech and Betty Woody. Berrey left the case after becoming chief of the Quapaw Tribe and cited a conflict of interest.
The government’s argument is that Osage headright owners received their retribution with the Osage Trust Case settlement of 2010 and the Cobell settlement, which is still being disbursed.
“What’s left in this case is either nothing or next to nothing,” said United States attorney Joseph Kim.
Aamodt disagreed and said he didn’t want to go back to the oil well, but instead wanted an accounting of the segregated fund, as defined in Section 4 of the 1906 Act that governs oil and gas production on the Osage Minerals Estate. The “segregated fund” is the fund headright money is stored in for an approximate two-month period before being dispersed to headright holders, the plaintiffs are alleging.
Kim disputed a “segregated fund” existed because those funds are held by the tribe and then disbursed to IIM account holders. He said headright holders receive an accounting of their IIM accounts every time they receive their checks and the amount awarded per barrel is published on the Osage Minerals Council website and headright holders, “can do the math.”
“They know what they should have gotten, did get, and that’s all the information they should get,” Kim said.
Aamodt said that is not a true accounting of funds and the plaintiffs would like the chance to conduct discovery into the accounting system and segregated fund for Judge Frizzell. Aamodt said, “I can’t believe the U.S. is admitting these funds aren’t held in a trust account?”
The 10th Circuit opinion said there is no limitation of dates for an accounting on this case, and that it should go back 100 years. Frizzell said the government’s means of accounting was dismissed “as a matter of law” with the 10th Circuit opinion.
“Does the U.S. have a duty to an accounting? The answer is clear, so we obviously do have some facts and disputes that remain,” Frizzell said.
The next hearing is set for March 6 at 9:30 a.m. at the Tulsa Federal Courthouse in downtown Tulsa.
To reach plaintiff’s attorneys, contact Aamodt Law Firm at (918) 347-6169.