Mitchell rodeo grounds case crawls toward trial this spring

MITCHELL — A recent court ruling in the lawsuit from Corn Palace Stampede Rodeo against its landlord Horsemen’s Sports Arena has stripped out the individual liability for Horsemen’s directors, while continuing to point the case toward a 2023 court date between the two parties.

In January, First Circuit Court Judge David Knoff ruled that the individual defendants in the lawsuit on the side of Horsemen’s Sports — Brandon Neugebauer, Joel Bergeson and Paul Parr — will receive summary judgment and be dismissed from the case. Knoff wrote that there is “no basis to pierce the corporate veil” in the case.

“Piercing the corporate veil” is a situation in which courts hold a corporation’s directors personally liable for the corporation’s actions or debts. Knoff wrote there was no showing from Corn Palace Stampede that Horsemen’s Sports is acting as a sham corporation, adding that the individuals named are volunteers for the not-for-profit Horsemen’s Sports corporation.

The lawsuit between the corporate entities in Corn Palace Stampede and Horsemen’s Sports will continue. That is in part because Knoff denied a summary judgment request from Corn Palace Stampede to rule in their favor. Those orders were formally filed this week.

“The Court is not in a position to state whether property that’s been set in concrete or not, or property is vital to the arena is meant to stay or leave with Corn Palace [Stampede] moving their facilities or what constitutes damage to the remaining facilities,” Knoff wrote.

In October, Knoff sided with Horsemen’s Sports by ordering that bucking chutes removed by Corn Palace Stampede should be returned to the grounds by mid-November, after they were taken away from the grounds by members of Corn Palace Stampede for repairs. The chutes were found at the city of Mitchell's impound yard after being reported missing by Horsemen's Sports from the rodeo grounds.

Knoff reiterated that the court has two standing orders that neither party should remove any improvements to the facilities and to prohibit removing any equipment kept or installed on the property for the grounds’ regular operation. Those orders are what allowed the rodeo to take place on the grounds in 2021 and 2022.

Neugebauer wrote in an affidavit that he’s been a member of Horsemen’s Sports for 22 years and it was the first time that Corn Palace Stampede has removed the chutes for repairs or maintenance, which occurred at some time after the mid-July event.

In an amended complaint, Corn Palace Stampede attorney Jim Davies wrote that Horsemen’s Sports has damaged improvements that it has made to the property, including the interior arena fence, bucking chutes and the VIP area grandstand. It has argued that it should be able to sever the improvements from the real estate and be declared the owner of those items, allowing Corn Palace Stampede to remove them and place them at a new site.

In the 1999 lease agreed to between the two parties, Corn Palace Stampede is able to make improvements to the facility with the prior written agreement of Horsemen’s Sports but it reads “unless such improvements by be readily removed without damage to the remaining facilities, the improvements shall become part of the facility and the property of Horsemen’s Sports.”

Knoff wrote the phrase “may be readily removed without damage to the remaining facilities” is ambiguous about what constitutes damage, either economically or physically.

“The Court is not able to determine whether it was intended that this would continue to be a rodeo grounds and roping arena after Corn Palace Stampede moves out, or does it mean that it was to go back to its original state as a bare lot,” the judge wrote.

The two sides have had a lease agreement since 1992, which has been extended in 2000 and 2015 and now is set to run through Sept. 29, 2031. In a counterclaim filed in November, Horsemen’s Sports argues that Corn Palace Stampede failed to hold up its part of the lease and “engaged in a course of conduct … designed to thwart the use of the leased premises by Horsemen’s Sports.”

The current Horsemen’s Sports Arena, located on State Highway 37 near Lake Mitchell, is the only site the Corn Palace Stampede Rodeo has ever been located, dating back to 1971. Since the start of the dispute, Corn Palace Stampede has created another organization the Mitchell Rodeo Foundation and agreed to a lease in 2021 to use 20 acres of land near the Mitchell Regional Airport for future rodeos.

In a counter claim from Horsemen's attorney Timothy Whalen, Horsemen’s is asking for a minimum of $160,000 in damages in the case, which it says is the financial loss it would have if the lease is broken with eight years remaining, and the termination of the Corn Palace Stampede’s interest in the premises.

The case was first filed in September 2020. A jury trial in the case, which has been moved twice already, is scheduled for April.