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State, TigerSwan settle longstanding dispute over DAPL security

State, TigerSwan settle longstanding dispute over DAPL security

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Gavel and scales

North Dakota regulators on Monday voted to settle a longstanding dispute with the North Carolina-based company that handled security for the developer of the heavily protested Dakota Access Pipeline, for just a fraction of the money they had sought.

A last-minute disagreement between the two sides threw the settlement into question, however.

TigerSwan and former President James Reese are to pay $175,000 to North Dakota's Private Investigative and Security Board. The company does not admit to any wrongdoing but agrees to not operate in the state, where it isn’t licensed.

The board in October 2018 filed an administrative complaint seeking more than $2 million in fines and fees from TigerSwan. Regulators alleged 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 pipeline that was protested by American Indian tribes and environmental advocates.

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.

The board also took its complaint against TigerSwan to state district court. South Central District Judge John Grinsteiner in 2018 rejected its request to ban TigerSwan from the state and ruled that any decision on whether the company should be fined should be made administratively -- not through the courts. The Supreme Court a year ago unanimously upheld the ruling.

TigerSwan had recently gone back to state court, arguing in part that the board did not have the authority to administratively sanction a company that it had never licensed. That case will now become moot.

The board on Monday voted to approve the settlement after discussing the matter in executive session, which is closed to the public.

“The parties decided to resolve the cases without any further litigation,” board attorney Monte Rogneby said during the public part of the meeting.

TigerSwan officials including Reese also signed off on the deal during the meeting. Company attorney Lynn Boughey said the money would be deposited Tuesday.

The company issued a statement to the Tribune saying it was “pleased to have reached an agreement in which we did not admit any liability or violation of any North Dakota laws.”

“We were previously successful in the district court and the North Dakota Supreme Court, but in order to resolve the present administrative action that the Board brought against us as well as the case we brought against the Board in the district court, we were willing to resolve this by paying a portion of the Board’s cost in bringing the various actions against us,” the statement said.

The settlement agreement did not specify that the $175,000 was for costs, as opposed to a fee or a fine. Boughey told the Tribune that was an oversight on the board's part. Rogneby told the Tribune that Boughey "did not ask that the nature of the $175,000 payment be addressed," and that "further action by the Board may be necessary."

"The Board had previously raised with TigerSwan and Mr. Reese that its costs in the administrative action are less than $175,000 and that its costs for all of the litigation, combined, are less than $175,000," he said. "The Board does not want to agree to something which may be misleading."  

The board scheduled another meeting Tuesday.

Boughey told the Tribune that TigerSwan has no issue with the ban on operating in North Dakota.

"Given the way the board has treated them and gone after them, they have decided never to do any more business with North Dakota," he said.

 

Reach Blake Nicholson at 701-250-8266 or blake.nicholson@bismarcktribune.com.

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