DEVILS LAKE, North Dakota — A North Dakota cattle buyer faces a Class A felony theft charge for failing to pay for cattle in Ramsey County, but that case is just one piece of a financial puzzle that includes a Nebraska cattle company, a South Dakota bank and a Wisconsin bonding company.
Brian Wayne Gader, of Napoleon, North Dakota, is scheduled to appear in court for a pre-trial hearing on Oct. 14 in Devils Lake. Class A felonies are punishable by up to 20 years in prison and fines of up to $20,000.
Gader, through his lawyer, Irvin B. Nodland, of Bismarck, North Dakota, has pleaded not guilty to the theft charge. Nodland declined comment to Agweek, saying he never comments on cases.
Gader is accused of bouncing a check for over $200,000 to Jim Ziegler, owner of Lake Region Livestock of Devils Lake, in December 2020.
The criminal case is in addition to several civil cases for Gader, 65, who is being foreclosed on for loans worth millions, with victims spilling outside the state. Gader on Oct. 6, 2021, in a phone call, declined to talk to Agweek, on advice of his attorney. He would only say he is “working on” his legal issues.
“I don’t think there’s a law that prevents him from doing that,” said Agriculture Commissioner Doug Goehring, noting some of the local cattle buyers don’t want him there. “He’s not buying cattle.”
Goehring said sale barn operators have a right to ask him to leave.
On Feb. 18, 2021, Goehring issued a temporary cease and desist order against Gader, after complaints of non-payment surfaced. On March 24, 2021, the department made the order permanent, revoking his license.
In a separate Logan County civil case at Napoleon, Gader has admitted he owes nearly $490,000 to Bar T Cattle Company of Walthill, Nebraska. Bar T claimed Gader charged them for cattle that didn’t exist, an accusation he initially denied, through his lawyer. But Gader later admitted he owed the money to Bar T, and attempted to hand over land to Bar T. Now, a bank is suing to enforce its lien on land involved with the deal. Bar T disputes the bank’s claim of a superior lien.
Class A felony
In the criminal case, Ramsey County State's Attorney Beau Michael Cummings at Devils Lake, on May 18, 2021, filed an information against Gader, charging him with Class A felony theft. Cummings alleged Gader on Dec. 1, 2020, obtained three loads of cattle and wrote a check to Ziegler, owner of Lake Region Livestock, for $227,103.02, but the check didn’t go through.
After several delays, Northeast Judicial District Court scheduled a pretrial conference hearing for 1:30 p.m., Oct. 14, 2021, at the Ramsey County Courthouse in Devils Lake before Northeast District Judge Lonnie Olson.
Ziegler declined to be interviewed about the case by Agweek, saying only that he has longtime associations with Gader. Cummings also declined comment.
On Feb. 19, 2021 — more than two months after the bad check — Ziegler filed a complaint with the U.S. Department of Agriculture's Packers & Stockyards Division in Des Moines, Iowa. Ziegler said that Gader had “settled all accounts but the one above.” Ziegler said he “paid it off” to the cattle suppliers but that Gader “never paid up” to reimburse him.
Ziegler explained that he held off filing a claim because he understood Gader and his wife had been “Covid-sick for some time” after the failed transaction, and were hospitalized “up and down” so Ziegler “never pushed it until now.”
Later, Ziegler claimed the amount of $227,103.02 against Gader's bond. He said the case involved seven transactions, all on Dec. 1, 2020, at Lake Region Livestock.
Based on Ziegler’s complaint, and one from Bar T Cattle Company, Goehring held a March 3, 2021, hearing. Gader, as a requirement of his license, is covered by a $295,000 surety bond, held by Platte River Insurance Company, of Madison, Wisconsin, an operating company of CapSpecialty Inc.
In the hearing, Gader admitted he owed money to Bar T but was "selling some land to cover what is owed."
Three weeks later, Goehring issued the permanent cease and desist order, preventing Gader from buying cattle. The department by then believed Gader was in breach of and in default of his bond, and was insolvent. The bond company, CapSpecialty Inc., (also known as Platte River Insurance Company) held off making payments until advised by the trustee. The North Dakota Department of Agriculture asked on March 25, 2021, to be named trustee in the insolvency, which was granted by Southeast District Court in Logan County on April 14. Joseph Paul “Dutch” Bialfke, general counsel for the ag department, handled the case.
The department filed legal notice in newspapers in North Dakota communities where Gader was known to do business — Napoleon, Mandan, Devils Lake, Dickinson and Rugby. Claims would be valid if filed within 45 days of publishing.
Only Ziegler and Bar T filed claims, which first went through the U.S. Department of Agriculture’s Packer’s & Stockyards Administration officials.
On Aug. 20, 2021, Bialke from the Department of Agriculture, asked the court to hold the ag department’s trust (bond) actions in “abeyance,” until related lawsuits were adjudicated or resolved. Gader didn’t object, but the bond company did.
The civil cases
The Packers & Stockyards complaint filed Feb. 24, 2021, by Bar T Cattle Company, also has resulted in a civil lawsuit filed by Bar T against Gader and another filed against Bar T by a bank with which Gader has done millions in business.
Bar T is run by Roger Tremayne, president/director and his wife, Lea Ann Tremayne, secretary/director, about 30 miles south of Sioux City, Iowa. Bar T Bar filed a U.S. Department of Agriculture claim of $470,484.13 against Gader. The company said it was owed money for two transactions — the first on Dec. 7, 2020, and the second on Dec. 21, 2020. The USDA complaint and a subsequent lawsuit for the same conduct, filed by Bar T in June 2021, indicate Bar T bought a total of 508 head, averaging $926 each, as part of an "oral contract" with Gader. The complaints said Bar T wired the money on or about Dec. 21, 2020.
The Bar T cattle were to be fed by a rancher near Napoleon “for a guaranteed cost of gain until the fall of 2021.” But Bar T did not receive expected feed bills from the feedlot operator, court documents said.
Bar T made “numerous efforts” to contact Gader, documents said, and on Jan. 30, 2021, Gader admitted that the 508 steers “never existed and were not purchased.” Bar T alleged that Gader “misrepresented relevant facts while knowingly and intentionally providing false information.” They claim Gader requested the Bar T payment be made “via wire,” which documents described as a “wire fraud.”
In the lawsuit, Bar T alleged various kinds of fraud, including breach of contract and negligence. Bar T said it was entitled to actual damages, and possibly “exemplary damages” on top of it, plus 6.5% “per-month” post-judgement interest, plus attorney’s fees.
Gader, through his attorney Nodland, initially asked the judge to dismiss the case and denied admitting to Bar T that the cattle didn't exist. However, on Aug. 11, 2021, Gader signed a “statement and confession judgement.” In it, Gader admitted he owed Bar T the full $490,484.13 ($470,484.13 principal plus $19,605.64 interest) as of Aug. 5, 2021, and interest after that. Two days later, Southeast District Judge Troy LeFevre at Mandan, North Dakota, ordered that Bar T had a judgement of $490,089.76 against Gader, setting the annual interest at 6.5% per year, starting Aug. 5, 2021.
According to a lawsuit filed on July 23, 2021, by Plains Commerce Bank of Sioux Falls, South Dakota, against Bar T, Gader attempted to transfer land to Bar T to cover his debts to them. Plains Commerce has filed a foreclosure action on that land, claiming an interest in real property. On Aug. 25, 2021, Attorney Daniel Nagle of the Kelsch, Kelsch, Ruff and Kranda firm at Mandan, representing Bar T, said Bar T had an interest in the property and denied that Plains Commerce Bank is secured by the real property. District Judge Daniel D. Narum set a scheduling conference for Dec. 13, 2021.
Jon R. Brakke of the Vogel Law Firm in Fargo represents Plains Commerce. In his brief, Brakke listed Plains Commerce’s five-year lending history with Gader. That started in 2015, when the bank first approved an initial promissory note — a principal amount of $750,000, lent with an annual interest of 5% for unpaid balances. Gader Cattle Company included both Brian Gader and Kristy L. Gader. He listed the status of each loan as of May 27, 2021, including the unpaid amount, and per diem (daily) interest accruing:
Nov. 16, 2015: Of the initial amount, $464,174.94 remains due, with “per diem” interest accrual after May 27, 2021, at $80.13.
Jan. 26, 2016: The bank issued a promissory note for $506,435, for which $433,151.72 was due, with daily interest of $56.53.
May 6, 2016: The bank issued a promissory note of $400,422. Of that, $341,487.57 was due, with a daily interest payment of $61.29.
Feb. 15, 2018: The bank issued a promissory note of $5.25 million. Of that, $6,651,404.90 was due, with a daily interest payment of $3,211.81.
Feb. 11, 2019: The bank issued a promissory note of $500,000. That note was now owing $565,389.49, with $253.89 per diem.
That’s a total of $7.9 million of unpaid balances, plus interest. In a phone interview, Brakke briefly acknowledged that those totals were correct as of the date of the report. He said the debt amount was being resolved, but had to cut off the conversation without explaining how.
Plains Commerce said its loans were backed by mortgages on land and property, and that Bar T’s interest is junior to the bank. Bar T disputed this.
In the background, Gader participated in federal assistance programs.
According to the USDA’s Farm Service Agency, in a Jan. 8, 2021, report compiled by AgriPulse, Brian Gader individually obtained a Coronavirus Food Assistance Program aid payment of $490,954, for cattle marketed in 2020. The money was to compensate for market disruptions due to COVID-19.
No reports are available yet on CFAP2 payments.
Separately, on Feb. 17. 2021, Gader received a Paycheck Protection Program loan of $20,883, through the Stock Growers Bank, retaining one job. Records indicate the loan has been paid in full or forgiven.