North Dakota’s Supreme Court has upheld the dismissal of a civil complaint state regulators filed against a North Carolina-based company that handled security for the developer of the heavily protested Dakota Access oil pipeline.
However, the court’s decision Thursday does not end the dispute, which will continue in another venue.
North Dakota's Private Investigative and Security Board sued TigerSwan in June 2017, alleging the company illegally operated in North Dakota without a state license in 2016 and 2017 while handling security for Texas-based Energy Transfer, which built the $3.8 billion pipeline to move Bakken oil to a shipping point in Illinois.
TigerSwan maintained that it provided only consulting services that don't require a North Dakota license and that any actual investigative work occurred in North Carolina, outside the board's jurisdiction.
South Central District Judge John Grinsteiner last year rejected a board request to ban TigerSwan from the state and ruled that any decision on whether the company should be fined for its actions during the protests should be made administratively – not through the courts.
The board appealed. The Supreme Court on Thursday unanimously upheld Grinsteiner’s decision, with Chief Justice Gerald VandeWalle writing “we agree with the district court’s resolution of this issue.”
TigerSwan attorney Lynn Boughey called the ruling “a big win” for the company.
“This entire case was a waste of time and money,” he said.
Board attorney Monte Rogneby said the ruling “makes the district court a more limited avenue of relief” for the board.
“One of the reasons the board chose to appeal has as much to do with getting the statutes in front of the Supreme Court so the board had some clear direction as to when the board should go to district court as opposed to administrative action,” he said.
The board last October filed an administrative complaint seeking up to $2 million in fines from TigerSwan. An administrative law judge put the case on hold pending the outcome of the Supreme Court case.
“I assume that the board will ask the administrative law judge to take that case off of hold and move it forward,” Rogneby said, adding that the board meets in about a week.
Boughey is seeking dismissal of the administrative case.
The Supreme Court did deny TigerSwan’s request to force the board to pay its attorney fees, which Boughey said are “substantial.” He declined to list an updated figure. Last November, he said the amount was at least $165,000.
The civil case also has cost the regulatory board tens of thousands of dollars and last year forced it to dip into financial reserves and delay payment of some legal bills. The board has said it is not struggling financially and that it continues to go after TigerSwan because it has a duty to protect the public from unlicensed operators.
Reach Blake Nicholson at 701-250-8266 or Blake.Nicholson@bismarcktribune.com
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