LEE HOCHBERG: For 200 years, Indians say getting the short end of the stick has been as much a part of their heritage as drums and headdresses.
But many people at this recent heritage parade on the Blackfeet reservation in Montana think the work of one of their tribe, 56- year-old Elouise Cobell, may change that.
SPOKESPERSON: Go Indians!
LEE HOCHBERG: In 1996, Cobell became lead plaintiff in a class-action lawsuit on behalf of more than 300,000 American Indians. It sought repayment of at least $10 billion they say the U.S. government has cheated them out of for more than a century.
ELOUISE COBELL, Plaintiff: We've never been able to make the government accountable, you know, for starving our people, for massacring our people.
But now we finally have them, and I think that this is the turning point.
LEE HOCHBERG: Two federal courts already have ruled in their favor, but the battle is far from over. The case really started in 1877, when the US government broke up 30 million acres of Indian reservations in the West.
Most of the land passed into white ownership, but the government allotted about a third of it, in parcels of around 100 acres each, to individual Indians.
It said it would hold those parcels for the Indians in trust; lease them out for oil and mineral development, and issue the Indians royalty checks for the earnings off their lands.
For years, the Indians complained they got far less than they deserved.
ELOUISE COBELL: Why do people own thousands of acres of land, they have every type of resource, they have oil wells, they have timber, and...but look, they live in poverty.
LEE HOCHBERG: In testimony before Congress, the government has conceded that its payments to the Indians have been inconsistent, despite taking $500 million a year into the trust.
The issue has been confused by multiple heirs, duplicate accounts, and years of lost government records.
It seemed headed toward resolution in 1994, when Congress ordered the Interior Department -- which manages the trusts -- to make good on its obligations.
But little changed on the Blackfeet reservation. Cobell flew to Washington to talk to the Clinton administration's interior department.
ELOUISE COBELL: I tried to talk to congress and...really tell them how severe it was. And I think that...
LEE HOCHBERG: You went to [Interior Secretary] Bruce Babbitt.
ELOUISE COBELL: I tried to go to Bruce Babbitt. Bruce Babbitt would never meet with me. And I tried to go to Janet Reno, and I begged her for a meeting. Finally, I just got so tired of it, I decided to file the lawsuit.
JAMES KENNERLY: There's my eagle.
LEE HOCHBERG: One of the Indians she's fighting for is James Kennerly.
JAMES KENNERLY: I've got a whole bunch of the... of feathers, see?
LEE HOCHBERG: On the day we visited the Blackfeet reservation, Kennerly showed us a dead eagle the government had sent him as part of a cultural program.
But he said he's never been able to get the $100,000 he says the government owes him for oil taken from his land.
JAMES KENNERLY: Because this oil and gas royalty, look at, three cents! Three cents, eight cents. That's ridiculous. It's just totally a rip-off.
I don't see how they get away with it.
LEE HOCHBERG: Kennerly inherited this land from his grandparents, aunts and uncles, all of whom received allotments a century ago.
JAMES KENNERLY: There was five big wells producing over 5,000 barrels a week, and on a good week, you know, they'd be up to 10,000 barrels. Since the 1940s, these wells have been producing; even in the 1930s, these wells were producing. Where's the money? See? We didn't get it.
LEE HOCHBERG: During the trial, the situation turned out to be even worse than the Indians expected.
Court investigators found some of the money the Indians are owed the government never collected in the first place. Some that it did collect, it spent elsewhere, never offering it to the Indians. And many of the records, more than a century worth of records about who is owed what, the government destroyed.
DENNIS GINGOLD: There's been massive document destruction. Not only document destruction historically, but document destruction since this litigation was filed in June of 1996.
LEE HOCHBERG: Dennis Gingold is the Indians' attorney.
DENNIS GINGOLD: If you aggregate Enron and WorldCom and Global Crossing and Tyco and the other corporate scandals that we read about, and in aggregate they would not amount to probably a percentage, a significant percentage of what we are dealing with here.
LEE HOCHBERG: The court held then-Interior Secretary Babbitt and Treasury Secretary Robert Rubin in contempt for their failures to stop the document destruction.
District Judge Royce Lamberth said: It is "fiscal and governmental irresponsibility in its purest form…I have never seen more egregious misconduct by the federal government." Ruling in favor of the Indians in 1999, he ordered the Interior Department to account for what should have been paid in the past, and reform the system so funds are managed properly in the future.
ELOUISE COBELL: I was driving down the road, and to tell you honestly, I pulled over and cried.
LEE HOCHBERG: But the battle in Indian country wasn't over. The judge stayed on the case to monitor the Interior Department's progress towards trust reform.
Last year, he discovered its trust records were vulnerable to computer hackers -- conceivably oil and mineral producers themselves -- and he ordered the department's Internet connection shut down until security was improved.
Interior cut off trust payments for the next three months to tens of thousands of Indians.
Assistant Secretary of the Interior Neal McCaleb says without being online, his department couldn't get the data it needed from oil producers to calculate royalties.
NEAL McCALEB, Assistant Secretary of Interior: If you were getting a thousand faxes from a thousand different sources in a thousand different formats, and then you had to put that together manually, I doubt that you'd be able to do that very quickly.
LEE HOCHBERG: And without the Internet...
NEAL McCALEB: Without the Internet, we were basically out of business.
LEE HOCHBERG: The Bureau of Indian Affairs' Web site blamed Cobell's lawsuit. She says the government was setting her up as a target for angry Indians.
ELOUISE COBELL: And several individual Indians said they had called the BIA agency office and asked, you know, "why... how come I didn't get my check? I didn't get my check. Why didn't I get my check?"
And the answer was, "Go ask Elouise Cobell. It's her fault."
LEE HOCHBERG: The government denies it was targeting Cobell.
LEE HOCHBERG: This fall, the case was again in court. The judge found current Interior Secretary Gale Norton and her assistant, McCaleb, in contempt on five counts for failing to repair the computer problem, and submitting to the court falsely positive progress reports.
Calling both unfit administrators, Judge Lamberth wrote: "I have never seen such a concerted effort to subvert the truth-seeking function of the judicial process. The Department of Interior is truly an embarrassment to the Federal government."
The administration says Judge Lamberth vastly exceeded his powers. At an October meeting with western tribal leaders, McCaleb said his department had inherited the problem.
The administration this month appealed the contempt charges.
NEAL McCALEB: I have never deceived anyone. I have never perpetrated fraud upon anyone, and neither has Gale Norton.
LEE HOCHBERG: Nothing that was ever submitted to the court was incorrect...
NEAL McCALEB: No, I didn't say that.
LEE HOCHBERG: ...Was misleading?
NEAL McCALEB: I didn't say there wasn't ever anything incorrect. I think that there was a desire to meet the timeline that the court had established, and that the department was working diligently to try to accomplish that, and they focused on their accomplishments rather than the deficiencies.
LEE HOCHBERG: Interior, which already has spent $614 million on trust reform, proposes a $2.5 billion plan to try to reconstruct its records. It says it will take ten years.
NEAL McCALEB: Some of those source documents are held by oil companies that have kept those records, or individuals that have kept those records that can be reconstructed. And that's what makes it such a burgeoning task.
LEE HOCHBERG: Lawyers for the Indians say the proposal is just a tactic to delay.
DENNIS GINGOLD: It's impossible to reconstruct transaction records where you have decades of destruction. The reality is it can't be done.
LEE HOCHBERG: The Indians want the accounting put in the hands of an independent receiver who they say could use computer models to reach a resolution in a year.
Gingold says the Indians are owed $10 billion. The government says there's no proof of that.
NEAL McCALEB: There's no basis for any of this. I mean, if I were an account holder, I'd say, "Well, golly, I've got $1,000. Maybe I should have gotten $2,000."
And until the accounting is done, you can't make that determination on how much money is owed. Maybe it's $10 billion. Maybe we've overpaid it $2 billion. I don't think so, but, you know, there's no evidence to the contrary.
LEE HOCHBERG: Comments like that leave some Blackfeet wondering if they'll ever see their money. Gathering recently on the reservation to hear the latest on the lawsuit, several held out a healthy dose of cynicism.
MAN: It looks to me like it's going to take a lot of... a long time to make them own up to what they've done, because they haven't owned up to it in the 500 years that they've been here.
LEE HOCHBERG: The government is expected to file its plan for historical accounting in January.
The plan goes to trial in May.