Thompson Farms seeks $2.6 million from Aurora County in lawsuit

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YANKTON - A lawyer for E.L. Thompson Farms Ltd. requested $2.6 million from a jury Thursday during the first day of a trial to determine damages owed by Aurora County.

The trial was moved from Aurora County to Yankton County to find jurors less influenced by media coverage of the case. The dollar amount was floated during the opening argument of Mark Meierhenry, of Sioux Falls, a former South Dakota attorney general and lead attorney for Thompson Farms.

Aurora County, whose insurer will not cover the damages, is hopeful no money will be awarded.

“We’ll be asking for zero,” Dick Tieszen, the Pierre-based lead attorney for Aurora County, said in his opening argument. “Just because a party sues doesn’t mean they are entitled to compensation.”

Actually, a judge already determined during a past trial that Aurora County committed inverse condemnation against Thompson Farms. That judge ordered this second trial to determine damages. Inverse condemnation occurs when a government takes or damages private property without paying just compensation.

The Thompson family was operating a roughly 1,000-head dairy in the county in the mid-1990s, but their plans for the second phase of an expansion were stopped by county zoning regulations imposed in 1998 that prevented them from increasing their herd size to 2,000. That expansion would have made the operation more economically viable, Meierhenry said Thursday; instead, the Thompsons were forced to sell the operation and take a loss. The Thompsons filed a lawsuit, and a judge in 2009 ruled that the county’s actions amounted to inverse condemnation.

The new trial for damages took three years to commence because Aurora County was in litigation with its insurer. The insurer claimed the county had not given timely notice of the Thompson lawsuit, and the insurer therefore denied any obligation to cover damages arising from the lawsuit. The insurer and the county went to court and the insurer won, leaving Aurora County and its taxpayers on the hook for any damages awarded.

Thursday, Meierhenry told the jury of 14 – 12 main jurors and two alternates – about the 2009 trial where it was determined that Aurora County, through its zoning laws, breached Thompson Farms’ constitutional due process rights. He explained that the current trial is to determine damages for those actions.

The earlier decision by Circuit Court Judge Bruce Anderson, who is also presiding at the current trial, stated that the zoning ordinance restricting the number of milk cows breached the constitutional rights of the Thompsons to use their land, and also diminished the farm’s value to potential buyers.

Tieszen told jurors they will be asked to consider the factor of causation during their deliberations. In other words, did the zoning ordinance cause the damages, or were the damages, if any, caused by other circumstances?

“It’s hard to tell it’s the same case when you listen to one side and then the other, when you hear what the evidence really is and what it supports,” Tieszen said.

Tieszen said evidence will show the Thompsons were running a mismanaged and failing dairy operation and Aurora County was not responsible for its demise. He said that by the time the Thompsons requested a larger herd size, they were being threatened by their lender with foreclosure.

“By August 2000 these people knew this dairy was being foreclosed, or at best, the dairy would be sold,” Tieszen said. “They had overspent by $3 million.”

Meierhenry said the value of the operation was damaged by the zoning ordinance that restricted the total number of cows to 1,050 head.

“The value of their property was destroyed on Feb. 24, 1998. We’re not claiming they went out with a hammer,” Meierhenry said, referring to county officials. “But they did damage and take away the use of great portions of that property.”

Also at the county’s table during the week-long action will be Naomi Cromwell of Tieszen’s office, and Roger Tellinghuisen and Michael Wheeler of the Rapid City law firm of DeMersseman Jensen Tellinghuisen & Huffman. Like Meierhenry, Tellinghuisen is a former attorney general of South Dakota.

Aurora County State’s Attorney John Steele was present but remained in the audience. Aurora County Commissioner John Steichen was present at the county’s table and Commissioner John Guindon was in the audience.

Also present for the plaintiff was attorney Clint Sargent. Clients Paul and Beverly Thompson and Keith and Gloria Thompson were present in the courtroom.

Testimony continues today with the cross-examination of Paul Thompson. Thompson testified Thursday about the dairy’s operations prior to its sale.

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