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Bollen Accuses State of Contract Breach, Corruption, Defamation, Wants $1.5M+ in Damages

Tucked in Jeff Sveen’s initial response the state’s lawsuit against SDRC Inc. is this one little sentence:

As you are aware, the Consulting Agreement between SDRC, Inc. and GOED… was terminated with no cause in September 2013 [Jeff Sveen, letter to Paul Bachand, 2015.10.22, in South Dakota response to USCIS, Exhibit G, p. 59].

Around that grit of sand Sveen and fellow Siegel Barnet Schutz lawyers Reed Rasmussen and Julie Dvorak craft this pearl of an Answer and Counterclaim to 32CIV15-000270, the state’s lawsuit against the corporate iteration of former EB-5 czar Joop Bollen.

Sveen and company now formally contend to the court that the state wrongfully terminated Bollen’s self-dealing contract. The September 19, 2013, letter from GOED Secretary J. Pat Costello to Joop Bollen says the state is canceling SDRC’s EB-5 contract “for cause,” but it does not state that cause. Paragraph 17 of the original contract says, “…This Agreement may be terminated at any time by either party for cause, including but not limited to any breach of this Agreement or the lack of good faith compliance by either party with the terms of this Agreement.” The contract does not lay out the state’s obligation to explain cause for termination to SDRC Inc.

SDRC Inc. contends that it “repeatedly requested the state to provide an explanation or documentation of the ’cause’ [mock quotes in original!] for which the contract was terminated,” but “The State never provided such explanation or documentation” [Counterclaim, paragraph 2].

Check it out: Joop Bollen is now suing the state for not sharing documents.

It gets funnier. In charging that the state failed to act in good faith, SDRC Inc. alleges that the state demanded that SDRC Inc. “maintain funds/accounts of monies belonging to the State, in essence forcing a private company to hold State money in what appears to be, in SDRC Inc.’s opinion, an attempt to circumvent legislative control of these monies” [Counterclaim, paragraph 18(a)].

SDRC Inc. appears to be referring here to the Indemnification Funds that SDRC Inc. held for the state. Team Bollen–Sveen may have a point: the 2014 audit of the Governor’s Office of Economic Development concluded that GOED had indeed kept those funds off the books for three years, until FY2013.

Now Joop Bollen and Jeff Sveen are accusing the Governor’s Office of Economic Development of hiding money from the Legislature. I must be rubbing off on my Aberdeen neighbors.

SDRC Inc. alleges that the state deliberately set out to harm Joop Bollen’s business. Sveen and company contend that SDRC Inc. stood to make more $1.5 million on the Dakota Natural Meats project, which the state approved for EB-5 investment in July 2013 and for which SDRC Inc. was recruiting Chinese investors in August 2013, just one month before Governor Dennis Daugaard canceled the SDRC Inc. contract. For good measure, Team Bollen throws some Mike Rounds magic math into the counterclaim and says the state’s interference with the Dakota Natural Meats project cost the state 1,273 jobs [Counterclaim, paragraphs 3–5].

The counterclaim further contends that the state, “through the Division of Banking, the Governor’s office and other state agencies and employees, intentionally engaged in tortious conduct” intended to “cause SDRC Inc. reputational and financial harm” [Counterclaim, paragraphs 13–14]. This count includes no details, but the mention of the Division of Banking suggests Bollen was none too happy having to apply for a lending license and possibly pay bank franchise tax on all those loans he made with EB-5 money.

SDRC Inc. claims the state has done it further harm by defamation and improper administration of the EB-5 Regional Center. SDRC Inc. asks the court to throw out the state’s lawsuit against it, pay Sveen and company for their labors on behalf of Bollen, and extract “damages resulting from wrongful termination of its contract with the State of South Dakota, lost profits, punitive damages, and other damages suffered due to the State’s wrongful actions.”

In other words, Joop Bollen doesn’t just want to escape the state’s suit; he wants one more big dip of our tax dollars.


  1. Roger Elgersma 2015-11-21 08:35

    If there was not the underlying goal of secrecy, this all would not have happened.

  2. The King 2015-11-21 08:41

    This might be funny if it weren’t so sad.

  3. Rorschach 2015-11-21 08:53

    Here’s Marty Jackley & Dennis Daugaard’s chance to sweep it all under the rug. Just pay Bollen & he’ll keep everything about Mike Rounds’s involvement a secret. But man! Are the feds still watching?

  4. Loren 2015-11-21 09:13

    It’s amazing! Here, in SD, we keep airing our dirty laundry in public, but it never seems to come out CLEAN! It is entertaining, tho, to watch one corrupt entity needle another.

  5. jerry 2015-11-21 09:20

    I think he may have a case. It might even be that he wins this, but there will be a looser and it won’t just be the taxpayers. Who will it be? Maybe someone in Washington that recently was elected? Perhaps. If so, the whole ship may sink, including the Dutchman to the bottom.

  6. Les 2015-11-21 09:33

    Despite 6 degrees in SD the heat is on. Who’ll be the first to make a deal? Come on down!!!!!!!

  7. caheidelberger Post author | 2015-11-21 10:44

    Rohr, is there any strategy here where the state and Bollen are setting up a settlement that would keep everything secret? Didn’t they already essentially have all the secrecy they needed? Or do they need to put on a show for USCIS to keep South Dakota’s Regional Center status?

  8. Rorschach 2015-11-21 10:50

    Cory, the only reason any of this is happening is because the feds are watching. Both the state and Bollen (all Republicans) had decided to let everything be water under the bridge for the good of Mike Rounds and the GOP (Bollen’s motivation was Bollen and the dollars he already had). Then Scooby Doo, er … those meddling kids in the federal government got involved. Hopefully the story ends as it’s supposed to.

  9. caheidelberger Post author | 2015-11-21 10:56

    So the question is, are the state and Bollen still in cahoots… or at least stuck in the hangover of a symbiotic/parasitic relationship from which neither can disengage without mortal harm? Or are they really going after each other tooth and nail here?

  10. 96Tears 2015-11-21 11:02

    What a shock this must be to the Government Operations & Audit Committee that held the hearing 14 months ago and gave the Rounds Racketeers a clean bill of health. When Tidemann was asking all those “pretty please” questions while refusing to place Bollen et al to be placed under oath, there was no mention that Rounds had engineered it so that SDRC Inc. “maintain funds/accounts of monies belonging to the State, in essence forcing a private company to hold State money in what appears to be, in SDRC Inc.’s opinion, an attempt to circumvent legislative control of these monies.”

    The sham GOAC hearing and Marty Jackley’s sham investigations should have turned up this very important point. I can’t believe I’m saying this, but GO TEAM JOOP!

  11. leslie 2015-11-21 12:11


    no wonder reds hate obama so in SD.

    cory did you wash and disinfect your hands thoroughly after touching and reading sveen’s answer/counterclaim? shower? maybe a mask will be necessary next time. lets just keep it digital from now on. geez sveen! sleezy is as sleezy does. christ cory, by the time this monkey businees gets resolved, you’d have your law degree. isn’t their an on-line ticket that would get you license somewhere? california, probably. you might not even have to be a formal resident. get your degree as you cover this case! unfortunately the sheer volume of information you’ll have to assimilate (just in evidence, civil and criminal procedure) while keeping the blog upright, will be staggering. yes, STAGGERING (but you do already have the writing skill part, mostly down!). Delegate!

    well, i guess its time for the parties and their lawyers to do a little “judge shopping” to avoid the CAFO-like stink. :(

    can’t wait till they are forced to drag in the big kahunas, rounds and daugaard. banking commission already slimed! and its about time! how in the hell is jackley going to avoid manipulating his little lawyer handling this case for his office and their client, the state?

    last sentence, para 8 (ANSW) is curious.

    Para 5 (CTRCLM) is hypothetical. Para 10 “unjustified” is again pretty cheeky. also, daugaard bragged to have shut-down SDRC Inc. Tortious interference means he was negligent or grossly negligent or malicious, perhaps. flash the denny eyes-wide photo again pls (but not if you wanna get into USD Law;)

    i like how both sveen and frankenstein impose on an underling the duty of signing the pleadings so they personally don’t have to. hmmm????

    btw, Sveen “notes” throughout the answer, is probably a tactic contrary to responsive pleading rules of civil procedure but is likely designed to alert the judge that the plaintiff is a really bad guy too. (equity prevents a party of unclean hands [not the infectious kind] benefitting in the court). “Improper, burdensome”-ha :)

    we are going to see more of this thrashing about like the infamous “it depends on what ‘is’ is.” Hilarious, as you mentioned, this claim the state is with-holding records from a records-thief. in some ways it takes a thief to catch a thief, especially in the new cyber-world, but here, we’ve got dinosaurs dabbling in waters over their heads, so apparently guns became necessary, some how, as we have seen with benda and westerhuis (maybe he wasn’t quite a dinosaur).

    however, the very public, required complaint and answer declarations will not be followed with such further public declarations if these guys settle, and soon! desparation apparent on sveen’s side. he has lost control; again imo.

    [aside: b. clinton really let us all down, as did daschle, granted, the pressure on them from the right was arduous. stephanie and brendan need to recognize this for their own perhaps bright political futures, imo]

    Rats on a sinking republican ship going after each other. wow. Sveen seems to have totally burned his “state crony legal work-life raft” for the whole law firm. wonder if he will be leaving the firm shortly?

    96-nice ID of tidemann’s blind complicity, together with many others.

    this is JUST like the state of NJ dems taking down presidential candidate chris christie. and he is a much better lawyer than either joop, rounds, or daugaard (i assume). see recent rachel maddow show where all of the lawsuit answers and discovery contain glaring redactions and “blackouts”.

    FUK**in republicans.

  12. Sid 2015-11-21 12:15

    The problem here is that there exists a situation in South Dakota, especially in the Aberdeen area, wherein Siegel, Barnett believes that they have a lock on the judiciary. In fact, there is actually a history of litigation wherein the local judiciary has made decisions which flout established precedent (at times to be reversed if the aggrieved party is able to appeal) when Siegel, Barnett’s interests (notably Sveen and Harvey Jewett’s interests) require such. Whether this influence extends all the way to Pierre will now be tested for the public to see.

    The “counter-claim” of SDRC, Inc. is one which pleads tortious (not contractual) misconduct. South Dakota revised statutes Art. 3-21-2 states that no such claim against the State or any “Public Entity” may be maintained unless NOTICE OF THE CLAIM is given to the PUBLIC ENTITY within 180 days of the event which gives rise to the claim. Sveen has pleaded that the event (or events) occurred in September, 2013. He has just now asserted his claim more than 800 days after the fact. He may try and get around the statute by saying that since it is a counter-claim notice was not necessary but since the statutes are very clear that the notice is a condition precedent to litigating the claim and not a form of limitations, then he should have the claim tossed and should even possibly be sanctioned for frivolously pleading the issue.

    Of course, since Mr. Sveen has freely and publicly engaged in conflicts of interest (Chairman of the Turkey Plant and representing the Veblen Dairies/Millners while representing SDRC, Inc. and Bollen) without any fear of sanction for conduct which normally leads to severe discipline if not disbarment, he probably has no concern about sanctions if his pleadings are frivolous and a waste of judicial time and resources.

  13. leslie 2015-11-21 12:16

    “sent w/o proof to expedite”


  14. caheidelberger Post author | 2015-11-21 14:12

    Wash and disinfect? Oh, Leslie, when Joop and Jeff write, I’m like a dog rolling in fish. Can’t get enough….

  15. leslie 2015-11-21 14:24

    ah-hahaha…catchin my breath. i walk a lakota aussie shepard all the time and for the life o’ me can’t get her to quit rollin’ on every dead antelope and cat in the road ditch…wiping eyes! god this country is great

  16. Rorschach 2015-11-21 14:59

    Cory, you ask if the state and Bollen are still in cahoots. I don’t think they have been “in cahoots” since Rounds left the big chair. What’s going on is that Daugaard and Jackley are doing damage control for their patron Mike Rounds and the SDGOP. They don’t like Bollen, but they will apparently stop at nothing to brush this under the rug for Rounds.

    Then along comes that big meanie federal government and forces them to do something after they had long since decided to do nothing. I don’t think that either side wants the dirty laundry aired. Both sides want this swept under the rug. If the damned federal government would just indicate it’s closing its investigation both sides to this lawsuit would quickly agree to a mutual dismissal.

    But the fact the feds are doing what they are doing leads me to believe their case is indeed active, and the Joopster may end up getting indicted – at which time things will start looking dark for Mike Rounds too and the minions that covered for him. Meanwhile, our AG doesn’t want to get caught looking like Sgt. Schultz while running for governor so he has to reopen his long-closed investigation and hope people forget by 2018 that he blamed it all on the dead guy in 2014.

  17. caheidelberger Post author | 2015-11-21 15:48

    Interesting read, Rohr. But man, to prevent that voter amnesia, I’m going to have some long blogging ahead.

  18. Francis Schaffer 2015-11-21 17:05

    He isn’t talking about the contract which he signed on behalf of the State of South Dakota giving SDRC Inc. authority to be the EB-5 regional center for South Dakota. That could prove interesting. The bw’s at the attorney general’s office will not go forward with this suit nor will GOED and citizens of South Dakota will be poorer for it.

  19. grudznick 2015-11-21 17:08

    It is odd that the police don’t just arrest this Mr. Bollen fellow and lock him away, but at least we can all rest tight tonight that the police will be nabbing up those druggies left and right and slamming them into cells. Weed is bad, it is bad.

  20. jerry 2015-11-21 20:05

    So where is the US Attorney’s office on this? Do we even have one in South Dakota or did we slip back to being a territory?

  21. 90 Schilling 2015-11-21 20:29

    I believe Rorschach is wrong in DD protecting Rounds. Dennis Rounds was very upset with DD for getting rid of him and said so publicly. DD is not taking one for the team, he is the team now or he would give up the Rounds family in a heart beat with the Feds in the hunt. Could be a deal in the works though. You never know which rat will start the cannabalism first.

    Yope and Sveen are poker players hoping to stare down the double d, ag and the press. Feds, not so likely. The tighter you wind this spring the bigger the bang when it all goes bust.

  22. grudznick 2015-11-21 20:48

    Mr. Schilling, do you mean Mike Rounds? Dennis is the first name of Mr. Daugaard.

  23. 96Tears 2015-11-22 10:23

    90, thanks for the stroll down memory lane! That story by Denise Ross packed a lot of information of who was involved and how they were involved. One month in front of the election, it was an awful lot of moving pieces to put together. Now, without the heat and light of a campaign for Mike Rounds and Dennis Daugaard on the same ballot, we can unpack the parts and examine them. Thank goodness for the feds reopening this racketeering scam.

    Based on his reaction in the news story, I wonder how Dennis Rounds could have been asleep at the switch when Bollen allegedly represented himself and the state in a high stakes lawsuit. Considering his closeness to Sveen and his law firm in the operation of this scam, I have a hard time believing that Bollen was the author of a brief filed in federal court. So, why would the true author wish to keep his/her fingerprints off of the filing?

    And wasn’t it convenient Mike Rounds’ brother Dennis had no memory of the court action?

  24. leslie 2015-11-22 11:16

    ferchissake, enough already-a bill against governor nepotism please. or else change the state flag motto from the mt. rushmore state and the seal to, respectively:

    “the Nepotism state” and “In Nepotism we trust”.

    the governor’s brother oversees all lawsuits, but missed EB5, and the governor’s son in law thinks we are all silly , and of course our current governor finds this all laughable.

    maybe lee, on the cheap, can give the entire legislature and administration, at the new year, his ethics notes from his seminar–“to those who desire it.”

  25. larry kurtz 2015-11-22 19:30

    Curious how this lawsuit is any different than Mike Rounds and Dan Lederman suing the US Army Corps of Engineers for flooding in 2011. When you build in a swamp you pay somebody for the permit to do it no matter what it costs. Why? Because moral hazard is the GOP way of creating the illusion of self-reliance.

  26. Whither 2015-11-23 12:56

    Jeff Sveen must have the balls of 14 hillbillies.

  27. caheidelberger Post author | 2015-11-23 13:53

    Bollen and Sveen are men of great confidence.

  28. Whither 2015-11-23 13:58

    Hubris but an apparent lack of shame. What will their children think of them?

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