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Bollen Wants State v SDRC Inc. Trial in Aberdeen

Joop Bollen and his legal team don’t want to drive to Pierre to fight the state’s lawsuit against Bollen’s EB-5 management company SDRC Inc. On November 17, Bollen’s lawyer’s moved for a change of venue from Hughes County to Brown County:

Defendant's Motion for Change of Venue, State of SD v SDRC Inc., 2015.11.17 Defendant's Motion for Change of Venue, State of SD v SDRC Inc., 2015.11.17

Lawyers Julie Dvorak, Jeff Sveen, and Reed Rasmussen argue that the state is misreading the statute that calls for cases dealing with indemnification contracts in the county where the indemnified resides:

Actions on contracts, surety bonds, or bonds of indemnity or liability, other than those referred to in § 15-5-4, issued by any such company or companies shall be brought and tried in the county where the indemnified resides at the time said action is commenced; or in the county where such liability or loss indemnified by such contract or bond occurred [SDCL 15-5-5].

The state is going after Bollen’s SDRC Inc. for not paying for the legal costs the state incurred defending itself from Bollen’s illegal DIY lawyering in the Darley lawsuit. Team Bollen contends that the state isn’t suing over a contract of indemnification but a contract that includes an indemnification clause and lots more. Thus, SDCL 15-5-5 doesn’t apply and venue is determined by SDCL 15-5-6, which says the trial happens where the defendant lives.

Legal readers, I welcome your analysis of the legal argument. But I say, heck yeah! Move the trial to Brown County! I would love to see the state take on Bollen and his crafty lawyers right here in Aberdeen, just ten blocks from my house! Joop, Jeff, thank you! I’m with you 100%!


  1. Sid 2015-11-25 10:32

    As I stated in my last comment regarding the answer and Counter-claim filed, they (Sveen and company) are able to receive special treatment by the Brown County judiciary. If this case is transferred to Brown County, the outcome is fairly certain and it will not be good for the State.

  2. Lanny V Stricherz 2015-11-25 11:21

    I know why they want it moved. It is because Pierre is so far away from anything else in the State, that it is hard to get there especially in the winter. I have thought for a long time that the capitol should be moved back to Yankton or better yet, Chamberlain.

    The reason that it is in Pierre, is that way they don’t have thousands of people coming to protest their shenanigans. If Bollen thinks that Pierre is too far from Aberdeen, how does he think that people from Rapid City, Yankton, Sioux Falls and other distant places feel having to go to Pierre to do business?

  3. 96Tears 2015-11-25 11:41

    Ballsy of Bollen! I’m a lot more impressed with Team Bollen than the state. Joop wants this case presented the way he desires, he’ll decide the witness and the evidence, and now he wants to dictate the venue. Can he also pick the judge and jury?

    This may be what Jackley prefers. Let Joop have his day in court. Go through the appearance of justice. Lose. End of story. Joop keeps churning up money. Everybody goes back to sleep. Back to dark. Except for those pesky feds!

    Hey Jackley! When Joop says jump, you jump boy!

  4. Lanny V Stricherz 2015-11-25 11:57

    Yes 96, those pesky feds and Cory and those few concerned citizens who want to take back our government from the crooks.

  5. David Newquist 2015-11-25 12:59

    Sid has a handle on the state of the judiciary in Brown County. Harvey Jewett, an erstwhile partner in Siegel Barnett, exercises power and influence up here. Faulty at NSU assumed he was the sponsor and guardian angel who placed Bollen at NSU, obviated any accountability Bollen had to NSU, and managed to keep Bollen in place, even thought there was no place Bollen fit into the academic mission of the university. When Jewett entered into the legal dispute between contending factions at the Hutterville Colony, for whom Jeff Sveen was the business agent for both groups, Jewett was appointed trustee of the Colony and blatantly took up the cause of one side. HIs performance at a hearing was so menacing to a witness, that a lawyer from his own side told him to step away when the judge failed to exercise proper control over courtroom decorum. The history of the judiciary n Brown County in that case showed the court giving him special consideration and privilege, although the State Supreme Court found that the course had no standing in dealing with what is essentially a religious dispute.

  6. David Newquist 2015-11-25 13:01

    Faculty, not faulty, although some may be.

  7. 96Tears 2015-11-25 13:52

    David – Thank you for the insight. That’s a profound problem. It may be why Jackley’s run from tackling the racketeering scam. If he stirs up a couple hornets at NSU, he stirs the entire hornets nest of the law firm and their law and banking pals across the state. My guess is they prefer caretaker Governors and Attorneys General who’ll roll over to get their bellies scratched rather than act as watchdog for the public.

    This must put Marty Jackley in a real box. He must either keep protecting the protected class in South Dakota or completely ditch any plans for higher office. If he plays ball with the protected class, he may get a bench appointment like his two immediate predecessors, and, depending on his performance to appease the protected class, he may be allowed to get the nomination for another office. If he goes after them, maybe they’ll take him back at Gunderson Palmer where he can help Sara Frankenstein with her agenda. Looks like a glass ceiling either way.

    There may be a third, highly risky path. Pursue the Brown County bunch. Cut a deal whereby they get a minor bruise in return for their full-throated support and maxed out candidate and pac contributions to Jackley for Governor.

    My guess is the Brown County boys don’t play ball with nobody. They make the rules. Watch your kneecaps.

  8. Whither 2015-11-25 15:31

    In thinking about jury selection, assuming it would be a jury trial, it seems to me the general populace in Brown County is more wise to Bollen/Sveen et al and their Smartest Guys in the Room capers, whereas perhaps a Hughes County jury might be more comfortable with such, er, public-private shenanigans.
    Imagine if Bill Janklow had been tried in Hughes rather than Moody in his manslaughter trial.
    So, yeah, I’m rooting for Brown County, too.

  9. daleb 2015-11-25 20:25

    I would think they would want this tried after the political season, if it ever goes to trial, or a jury trial. Wonder how far out a trial will be.

  10. leslie 2015-11-25 21:00

    reed rasmussen (not the same right wing former opinion editor at rcj) represented a defendant insurance company against a tort claim (bad faith) in nielsen v. boos (SD 1997) ( jury awarded $650,000 after the insurance company and its lawyer refused to settle for $250,000 policy limit).

    imho, the supreme court interpreted SDCL 15-5-5 in that case as “dealing with actions on contracts and indemnity bonds” and since Nielsen’s lawyer pled the complaint in tort rather than in contract or indemnity, the fall back provision of SDCL 15-5-6 applied, venue of the defendant.

    i note rasmussen’s pleading here is odd twice (which may or may not be pertinent):

    “the state will argue” seems a bit forward; and,

    his quote emphasizing “contracts”, “of indemnity”, and “issued by”, creates a shell game aimed at taking one’s eye off the broader intent of SDCL 15-5-5. the statute applies to “contracts” or “surety or indemnity bonds”. If joop’s liability is based on a complaint in contract rather (any kind of contract, not just an indemnity as rasmussen obfuscates) than in tort, then venue should stay in Pierre.

    Rasmussen’s analysis then goes “completely” gaga, in the style of the “Nielsen” court evaluating claims in the complaint as to whether each sounds in contract or in tort. But rasmussen tests the english teacher in all of us and brazenly asserts that this NOT a “‘contract of indemnity issued by’ SDRS, Inc.” (my emphasis). i am guessing it doesn’t have to be. duh.

    We should hope the state has a good lawyer for rasmussen must surely want a lunch buddy in aberdeen to decide the case. but who knows, perhaps this is what Daugaard/Jackley want too!

    shell game :)

  11. leslie 2015-11-25 21:25

    p.s. what happened to paul bachand? rasmussen must like tim engel better?

  12. leslie 2015-11-25 21:39

    how did the banking commission decision come out for joop?

  13. caheidelberger Post author | 2015-11-26 09:18

    Jury duty?! Jury duty!!! Yes! Pick me!

    Leslie, as far as I know, the banking commission has declined to make any public comment on the resolution of Bollen’s possible back taxes.

    Leslie’s comment on Rasmussen-Dvorak-Sveen’s underlining and grammatical interpretation of SDCL 15-5-5 is worth looking at. The phrase in question is “Actions on contracts, surety bonds, or bonds of indemnity or liability,….” Does the prepositional phrase “of indemnity or liability” apply only to “bonds,” or does it apply to all three of the listed noun phrases? Does the statute really mean, “contracts of indemnity or liability, surety bonds of indemnity or liability, or bonds of indemnity or liability”?

  14. caheidelberger Post author | 2015-11-26 09:33

    I’m seeing good arguments on both sides for which court might be less inclined to hold anyone accountable for South Dakota’s premier example of corruption. If the state and Bollen really are on opposite sides now, maybe each would find a home-court advantage.

    But tell me if I’m reading the players’ relative strengths correctly:

    1. Nobody in Pierre or Aberdeen gives a dang about Joop Bollen. If it were just his hide at stake, judges and juries in Pierre and Aberdeen would be equally happy to skin him… an Aberdeen crowd maybe even more so.
    2. Jeff Sveen is the focus of the arguments above for bias in the Brown County Courthouse (with Harvey Jewett lurking in the background). But in the Hutterville case David mentions, it was Sveen and Jewett versus a Hutterite group. Here we’re talking Sveen vs the state, kingmaker vs. king. Isn’t safe money always on the king in that battle?
    3. Marty Jackley can offer more players more goodies than Jeff Sveen can. He’s Attorney General now, and he can tell DCI where to look and where not to look. He wants to be Governor, from which office he can then dispense favors on a daily basis. Jeff Sveen can deliver a few thousand crucial Hutterite votes once every couple years in the Republican primary. What else does Sveen have to offer the everyday patronage-seeker?
  15. 96Tears 2015-11-26 09:48

    Good summary, Cory. Jackley holds the cards. Does he play them like a pawn or like a king?

    To quote the Four Tops: Are you man enough…big and bad enough?

  16. caheidelberger Post author | 2015-11-26 17:45

    Like a king, Marty! Play your advantage! Go ahead, accept the venue change, and wipe the floor with Bollen in his home court! The people will love you for it!

  17. Sid 2015-11-27 13:42

    No. Do not accept the venue change. The notion that the corruption of the Brown County judiciary is limited to Hutterite cases is absurd. It is the existence of the corruption that allows for the mayhem as in the Hutterite cases.

    Worry about a jury trial is premature since the judge who ends up assigned to the case will make various rulings which will likely pre-empt a jury trial from taking place. For example, in their answer, Sveen-Bollen pleads that the State has failed to state a claim. This is a question of law and not of fact which is determined by a judge who has broad discretion. If the Judge agrees that no claim is stated, then the case is tossed, subject to appeal. (Of course, the State could determine that an appeal would be a waste of time and money and then decline to pursue such.)

    There are a number of other matters which the judge will decide. Another example would be the appointment of a mediator. [Is Harvey Jewett available?]

    No no no no! A change of venue is going to be the first step in stopping this case from even getting to the point of depositions and discovery. A change of venue will allow Sveen and his firm to continue to cover up their involvement in the entire EB-5 securities fraud scheme.

    In fact, the State should first file a motion to disqualify the Sveen firm on the basis that a) Sveen and others are witnesses in the case and b) an unreconcilable conflict of interest exists which is hostile to the rules of ethics.As far as them claiming that their knowledge is solely based upon attorney-client privilege, that claim would fail for two reasons. First, the firm was engaged in business transactions with SDRC, Inc. which did not involve the attorney-client relationship and about which testimony will be needed. (The Turkey Plant) Second, the privilege is never applicable when the communication is for the purpose of perpetrating a fraud and/or crime which in this case involved at least several hundred securities law violations involving (at the very least which is known at this time) fraudulent concealment of material facts.

    As I stated, the jury pool is the least concern at this point if the matter never reaches a trial. If the venue is changed, the corruption and cronyism of the judges who sit in Brown County will stop this case from going forward and protect Sveen/Bollen and whoever else participated in the fraudulent scheme by derailing the case from being fully developed.

  18. Sid 2015-11-27 13:55

    One final note I left out above. If Seigel, Barnett are disqualified from appearing as attorneys in this case, the venue change should still not be done. Mr. Sveen has previously told clients when he was sending them to other attorneys due to conflicts of interest that they had nothing to fear since he would still be [controlling] the litigation from behind the curtain. There is little doubt he is still backstage.

  19. leslie 2015-11-27 14:06

    well said. again, pray for OUR lawyer paul bachand (or is it tim engel?) why does sveen prefer tim in his answ/ctrclm?

  20. caheidelberger Post author | 2015-11-28 08:25

    I like the idea of disqualifying Sveen and his firm; can such a motion proceed against the entire firm based solely on the material participation in the defendant’s monkeyshines of one attorney, or would the state have to demonstrate that Julie Dvorak and Reed Rasmussen actively participated in SDRC Inc. affairs as well?

    If Sveen is a kingmaker within the party, wouldn’t he have has much ability to sway corrupt GOP-appointed judges in Pierre (like Judge Mark Barnett, who hears motions on December 21 at 2:30 p.m. at the Hughes County Courthouse)?

  21. David Newquist 2015-11-28 09:14

    I do not see where anyone suggested that the corruption of the Brown County judiciary was limited to the Hutterville case.

  22. bearcreekbat 2015-11-28 12:28

    Cory, if one lawyer in a firm has a conflict in interest the entire firm also has the conflict.

  23. leslie 2016-03-07 21:04

    I wonder what role the feds are playing in this case, assisting the state? Any idea if any proceedings are scheduled?

  24. caheidelberger Post author | 2016-03-08 10:00

    State v SDRC Inc. gets a motions hearing on March 16, 1:30 p.m. CDT, in Pierre. LP6 Claimants v State and Bollen gets a motions hearing this week, Thursday, March 10, 1:30 p.m. CDT, in Pierre.

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