$1.28 million agreement reached in suit against Aurora County

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PLANKINTON — After a decade of litigation, the Aurora County commissioners announced a $1.281 million agreement late Friday with Keith and Paul Thompson, owners of E.L. Thompson Farms Ltd.

Aurora County plans to issue bonds to pay the settlement, since its insurer claimed successfully in a related lawsuit that it did not receive timely notice of the Thompson Farms litigation and is not obligated to pay the claim.

“I and my clients are pleased that this has finally come to an end,” said Sioux Falls attorney Mark Meierhenry, a former state attorney general who represented the Thompson brothers.

“My clients were very generous in giving concessions to arrive at this settlement and to stop this constant litigation that Aurora County’s been carrying on for over 10 years.”

Meierhenry said the Thompsons gave up accrued interest and agreed not to further contest legal expenses as part of the final agreement.

“I’m happy we were able to represent these folks,” he said. “When government goes too far and violates the constitution, Aurora County State’s Attorney John Steele said. “The commissioners decided that appealing or re-trying was not in the best interest of the county and they decided to see if they could settle it.”

According to the press release issued late Friday by Aurora County, the final settlement amount is for $1,281,355 and must be paid within 90 days. The Thompsons agreed to waive post-judgment interest for 60 days as part of the settlement.

Steele said the agreement inked Friday also began the process of arranging for judgment bonds — a type of general obligation bond — to pay off the agreement. The bond or bonds are non-referable. That is, the public will not be permitted to vote on the bonds, and the amount of the obligation cannot be referred to a public vote, Steele said. A Minnesota firm will be used as bond counsel.

The press release said the Aurora County Commission estimates the bond “can be retired in seven years they have to pay. It’s unfortunate all this had to happen, but those were the county’s decisions and they were the wrong decisions.”

The Thompson brothers, who ran SoDak Dairy near Storla, claimed that a 1998 zoning ordinance adopted by the county and the county’s subsequent 2001 denial of a building permit constituted an inverse condemnation, or illegal taking, of the Thompsons’ property.

Neither the Thompsons nor the commissioners could be reached immediately for comment Friday evening.

Provisions in the zoning code, the Thompsons argued successfully, kept them from expanding their herd, which they said was essential for the economic survival of their operation.

“The choices were to appeal, and probably have a retrial, or to settle,” without any significant increase in county taxes to pay for it.”

The commissioners do not expect a tax increase will be required next year, Steele said, but “after that it’s year by year, because you don’t know what the other budgetary needs of the county are.”

Normally such judgments can be paid from a catastrophic litigation pool, but Aurora County’s insurer argued successfully in court that it was not informed of the Thompson Farms litigation in a timely fashion. That left the bill in the lap of the county’s taxpayers.

During the summer, a Yankton jury awarded the Thompson brothers $600,000 in damages.

But Steele said the Thompsons and Meierhenry were asking the court to award about $1 million more to cover attorneys’ fees and expenses for expert witnesses. The settlement stops that effort.

“The case is effectively over, and that, by itself, is a plus,” Steele said.

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