Lawyers for Mike Rounds, Dennis Daugaard, and other subjects of Jeff Barth's legal action to stop destruction of EB-5 records filed their responses this week. The defendants contend that Minnehaha County Commissioner Barth has no standing, there are no records, yadda yadda.
Commissioner Barth's lawsuit is a legal longshot. But it has already produced some results worth discussing. First, Assistant Attorney General Roxanne Giedd says she has issued litigation hold letters to state agencies that may have records related to the state's EB-5 program. That means that, thanks to Barth's legal action, the Governor's Office of Economic Development, the Board of Regents, the Attorney General's office, and others will hang onto valuable information in the EB-5 case, which now stretches back ten years.
Northern State University counsel John Meyer tells the court that AAG Giedd's litigation hold isn't necessary to keep Regental docs locked up; he says that the Regents and NSU are already preserving documents related to EB-5 because of their ongoing litigation in Darley v SDIBI. Meyer issued a litigation hold to NSU chief information officer Debbi Bumpous after learning of the Darley litigation that EB-5 chief Joop Bollen had concealed from NSU for months. The Meyer hold went out on February 10, 2009.
Now let's slow down and think for a moment. A county commissioner files a lawsuit to preserve state EB-5 records. The AG's office immediately issues orders to preserve relevant state EB-5 records. Those orders likely go out to the offices directly involved with EB-5, including the Governor's Office of Economic Development.
In January 2009, the state found out Darley, a California company, had taken it to court over EB-5. NSU's lawyer sent out an order to his campus's computer gurus to preserve EB-5 documents, but NSU wasn't in charge of EB-5. Meyer says GOED ran EB-5. Meyer would surely have wanted GOED to hold any documents that could help him and the Regents fight off the Darley litigation. If Meyer lacked the authority to issue such a litigation hold to GOED, surely the attorney general could have issued that letter. Meyer corresponded with the attorney general's office about Darley in early February 2009, before issuing his February 10, 2009, hold order to NSU's CIO. An AG's office doing its due diligence would have joined Meyer in preserving all relevant documents, which leads to the logical conclusion that Jeff Hallem, the assistant AG corresponding with Meyer, would have issued a letter like Giedd's to GOED.
And if GOED got a litigation hold letter like Meyer's in February 2009, and if that hold is still in effect for GOED as Meyer's still is for NSU, then someone, somewhere, should have a thumb drive or tape or box of papers preserving any EB-5-related e-mails that GOED would have sent or received. That drive/tape/box would include the e-mails of then-GOED director Richard Benda.
By this reasoning, we may conclude either that Governor Daugaard's office misinformed us or that at some point in early 2011, the Daugaard administration erased e-mails that would have been subject to a litigation hold order.Meter's February 10, 2009, litigation order would have preserved any e-mails Secretary Benda sent to Bollen on the NSU servers. Whether Benda's entire e-mail archive is still available depends on the answers to these two questions:
- Did GOED receive a litigation hold order in 2009 pertaining to the Darley lawsuit?
- Did GOED follow that order?