SIOUX FALLS – A federal district judge today (Monday) dismissed Democratic Minnehaha County Commissioner Jeff Barth’s petition to preserve evidence in the EB-5 scandal.

However, Judge Karen E. Schreier did give Barth’s attorney, Richard Engels, of Hartford, the opportunity to add a new petitioner to the matter, Richard Hulshof, a former employee of the now defunct Northern Beef Packers plant in Aberdeen.

The plant was funded in large part through foreign investments garnered by the state’s, then SDRC, Inc.’s, use of the federal EB-5 immigration program.

In her decision, Schreier said Barth did not have standing to bring the claim as an interested taxpayer, as the United States Supreme Court has made such suits nearly impossible in most legal matters. She also expressed concerns whether Barth has stated a federal claim.

In arguments before the court, Engels admitted that Barth probably didn’t have a federal claim and his relief might lie in state court. However, he stressed concern that former South Dakota International Business Institute then SDRC, Inc. head Joop Bollen allegedly kept documents from SDIBI when the company he set up received the state contract to conduct the state’s EB-5 program.

Counsel for the respondents said the Rule 27 action—which allows the preservation of evidence in limited circumstances—could have been accomplished with a “litigation hold” letter from Engels to the potential parties to keep any pertinent evidence. Regardless, they argued, attorneys for the state and former Gov. Mike Rounds swore in affidavits they would not dispose of any potential evidence.

Both sides saw Schreier’s decision as a victory.

“It’s a total rebuke of Commissioner Barth and this type of lawsuit being brought,” Dick Wadhams, a consultant and spokesman for the South Dakota Republican Party said following the hearing. “It was brought for press coverage and it is totally discredited.”

Barth’s lawyer Engels said they would fight on another day when the court considers whether to allow Hulshof to be added as a petitioner.

“It’s difficult to get people to be the first one to come forward and put their name on a court pleading,” Engels said following the hearing. “It takes courageous individuals like Mr. Barth and Mr. Hulshof who are trying to get some accountability in this whole EB-5 fiasco.”

The next hearing to consider if Hulshof can join the action cannot take place for at least 21 days from its filing Monday.