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Plaintiffs may seek redress as group, judge rules

By Rob Perez

LAST UPDATED: 4:40 p.m. HST, Feb 12, 2014

A state judge presiding over a class-action lawsuit against the Department of Hawaiian Home Lands has ruled that plaintiffs who waited years for homestead leases can be treated as a group in determining damages, effectively eliminating the possibility that as many as 2,700 separate trials will be held.

The recent ruling by Circuit Judge Virginia Crandall is being hailed by one of the plaintiffs’ attorneys as the most significant development in the case since the court in 2009 determined the state failed to meet its trust obligation by not issuing leases in a timely fashion.

After then-Judge Eden Elizabeth Hifo four years ago found the state and DHHL liable for damages resulting from trust breaches, the case moved into the damages phase, with both sides arguing over the appropriate way to calculate the amounts. A trial is scheduled for October to determine the land-rental values to be used in those calculations.

“Everything literally would have fallen apart if (Judge Crandall) did not certify the class,” said Tom Grande, one of two attorneys representing the 2,721 Native Hawaiians suing the state for breach of trust from 1959 to 1988.

Although the 2,700-plus plaintiffs were certified as a class in 2000 for the liability phase, the court had not made that call for the damages phase until Crandall’s verbal ruling July 12. She granted the plaintiffs’ motion despite what the state called its strenuous objections.

Chicago law professor Gil Johnston, who is familiar with the class-action case, described the ruling as a significant win for the plaintiffs.

“If I was one of the plaintiff attorneys, I would be dancing around my office,” said Johnston, a faculty member at the John Marshall Law School in Chicago.

Crandall’s ruling will simplify the process and, most importantly, spare the plaintiffs from having to pursue damages on an individual basis, according to Grande.

Without that class certification, the plaintiffs would have had to hire their own lawyers or represent themselves, and many would have pulled out of the case, unable to devote the time or money to pursue a lawsuit, according to Grande and Johnston.

“It would’ve really gutted the case,” Johnston said. Many plaintiffs likely would have determined that the potential damages in their own situations would not justify pursuing a lawsuit, he added.

Had the class not been certified, Grande said in an email that he and Carl Varady, the other plaintiffs’ attorney, still would have pursued “whatever alternative strategies would be available to give these clients the justice they deserve,” adding, “We made a commitment that we would see this case through to the end.”

While the waiting-list group will be treated as a class, the court still must

decide a method for resolving factual disputes involving individual plaintiffs, such as whether they are entitled to compensation under the rules established in the case.

Crandall already has ruled, for instance, that a plaintiff is not entitled to compensation if he or she received a homestead within six years of applying for one. She said such a wait would be considered reasonable.

The state had argued unsuccessfully that the plaintiffs should not be treated

as a class in the damages phase because of the wide variety of facts involving many of the cases and the need to screen those using the court-approved rules.

“We believed and still believe that there are too many individual differing circumstances that need to be taken into account in order to make the determination for a huge number of these individuals as to what appropriate damages are,” Attorney General David Louie said in an interview last week.

He downplayed the notion that the state was arguing for 2,700 trials.

“I don’t think anybody was realistically going to hold 2,700 separate trials on anything,” Louie said.

But while the facts in some cases will be undisputed, the court still must determine how the disputed ones will be decided, he added.

“Some of these claims may need to be resolved with individual trials,” Louie said.

The October trial will not deal with individual claims. Instead, it will determine the rental values to be used to calculate out-of-pocket expenses the eligible plaintiffs can claim for damages, based on their wait for a homestead.

While the long waits accounted for the main breaches alleged in the lawsuit, others — including lost applications and the awarding of homestead lots that were uninhabitable — still must be decided, creating even more uncertainty on how long the case will last.

DHHL is the state agency that manages a 203,000-acre land trust for Native Hawaiian beneficiaries, who must have a blood quantum of at least 50 percent. 

Leona Kalima, the lead plaintiff in the class-action lawsuit known as Kalima v. State, said she was elated by Crandall’s ruling.

“It will be very helpful for the next round,” she said.

The lawsuit has dragged on for nearly 14 years and is nowhere close to being resolved. Barring an out-of-court settlement, the litigation could continue for years. Already, more than 300 of the 2,721 plaintiffs have died, and the average age of those remaining is about 65.

While Crandall granted the plaintiffs’ motion to certify the class, she denied their requests to have a special master and claims administrator appointed in the case. Both would assist the court in dealing with individual claims. Crandall said such requests were premature but could be refiled later in the process.

The lawsuit affects only those beneficiaries who filed breach-of-trust claims with an administrative panel in the 1990s that were never resolved. The breaches involved actions by the state between 1959 and 1988.

Beneficiaries who believe breaches occurred since then are able to sue the state under a different Hawaii statute.

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