Utah slated to pay $33 million to settle Navajo suit

SALT LAKE CITY — Utah is slated to pay $33 million in a proposed settlement of a long-standing lawsuit over management of an oil-royalty trust fund intended for Navajos in San Juan County.

After 17 years of litigation and recent months of mediation, all sides have reached a tentative agreement.

The case, Pelt v. Utah, was a class-action lawsuit filed in 1992 by eight people on behalf of San Juan County's 8,000 Navajos. It challenged Utah's management of a trust fund that had been created by the federal government in 1933. The state was chosen to manage the trust.

Money for the trust came from oil found on Navajo land, and 37.5 percent of the royalties were supposed to be deposited into the fund for the health, education and welfare of San Juan County Navajos.

The case was filed because plaintiffs alleged Utah had mismanaged the fund, did not keep proper records and lost money or spent it incorrectly.

Representatives from both sides began mediation in June, with U.S. Court of Appeals Senior Judge William Canby overseeing the talks.

"While a trial might have meant different results, that would have been years from now and at great additional expense to all," said Salt Lake attorney Brian Barnard, who represented one of the individuals. "Settlement of the case means an end to litigation, but more importantly, it means money more quickly into the trust to aid the beneficiaries. The eight individuals who brought this class (action) lawsuit look forward to the help the increased fund can bring to San Juan County Navajos in the future."

Utah Attorney General Mark Shurtleff said he also was satisfied with the proposed settlement.

"It's been long, drawn-out and costly, so we were very pleased to be able to resolve it, not only for the benefit of the state of Utah and the taxpayers, but also for the Navajos," Shurtleff said. "Now, there will be significant monies going down there to help the Navajo nation in the future."

Barnard noted that Gov. Gary Herbert, shortly after he took office, met with leaders of the Navajo community and indicated he wanted to get the dispute settled.

"I think he had some influence in the case," Barnard said. "I appreciate the leadership and wisdom of the current state administration in being willing to sit down with us. We mediated this for the last six or seven months."

The settlement does not accuse the current administration of doing anything wrong, but it does acknowledge that "errors and problems" with the trust stretch back as far as 50 years, Barnard said.