SD foreclosure case could involve more than 31,000 head of cattle

ARMOUR, S.D. — A Douglas County court addressed a multi-million-dollar foreclosure case involving thousands of head of cattle, a car crash and at least enough interested parties to fill a courtroom on Feb. 14.

The case was brought by First Dakota National Bank against Robert and Becky Blom, of Corsica, on Feb. 8. The bank’s complaint asserts that the Bloms had overdrawn their account by more than $1 million and that, in combination with Robert Blom’s incapacitation following an early February car crash, was enough for the bank to consider itself insecure.

In addition to the bank, nine law firms filed notices of appearances in the case representing 17 additional parties. However, it’s currently unknown just how many parties will be involved in the case or how much money is owed, as not all parties have yet been identified. Parties in attendance at the hearing declined to comment on the case.

As of Feb. 7, the complaint stated that the Bloms owed a principal amount of $6,748,600.92 in notes and an additional $792.75 per day in accrued interest on those notes.

While it’s not yet known how much money the Bloms could owe in total to all parties, court documents indicate that one company — Gader Livestock LLC — entered into a sales contract on Jan. 26 in which the Bloms agreed to pay $269,674.26 for 146 steers and 120 heifers.

Robert Blom was arrested and charged with a first-offense DUI on Feb. 5 after he was involved in a crash and gave a preliminary breath test of 0.18 when he was booked into the Davison County Jail. According to a probable cause affidavit, Blom’s family members indicated to law enforcement that he had “told them they would be better off without him being around.”

An affidavit filed by Wayne Williamson, the bank’s senior vice president, the same day as the complaint stated that a loan officer had been “advised by Robert Blom that he has prepared false documentation to customers for approximately three to four years” and that all of the Blom’s assets will have to be liquidated to satisfy the bank and other creditors’ claims.

That affidavit, which also asserted Blom had moved additional cattle, was the catalyst that motivated the bank to request the implementation of a receiver to speed things along.

Lew Dirks, a Sioux Falls-based investigator, was appointed as the receiver in the case and will ensure that the cattle are cared for, determine what cattle belongs to each party, be responsible for moving and liquidating the cattle involved and take legal action to repay debts and get information as needed, as well as other investigative tasks.

The case will move forward once Dirks identifies more of its components. Multiple attorneys said they could not comment on the scope of the case because they have only just gotten involved and currently only know the specifics of their clients’ side.

More than 50 people were present for the Feb. 14 hearing, during which the Bloms were determined to have defaulted in the foreclosure by not responding to the complaint. Members of the Blom family were present in the courtroom, but attorneys said they had not heard anything from anyone claiming to represent them.

Dirks testified on Feb. 14 that based on the conversations he’s had with interested parties over the course of several days, he’s currently estimating that this case involves 31,450 head of cattle. On three feedlots, he said he’s found 4,953 head in total and has heard rumors of an additional 2,400 being moved before he got involved with the case.

“Those numbers are moving daily,” he said. “Since Friday afternoon, it went from 10,000 to 31,000, as of (Feb. 13).”

Dirks said he expects to have to file additional suits to get information on cattle sales and trucking records for any cattle that may have recently been moved. He said he’s currently aware of seven legally-binding contracts that included Robert Blom’s signature and that for those, there is currently enough fat cattle to fulfill one and possibly part of a second one, and that he thinks it would be in the involved parties’ best interests to have the remaining cattle liquidated, which he hopes to have done within 30 days.

“I think the receiver needs to act as expeditiously as possible,” Judge Bruce Anderson said early in the hearing. “The cattle — they can’t stay out there forever. Some of them are ripe for market. They’ve got to go.”

To track cattle as much as possible, Dirks said he’ll be using brands, tags and veterinary information, as well as information from claimants. To gather invoices or other information from the Bloms’ business, the court ordered Todd Cowman, who owns and operates an IT business in Yankton, to complete imaging of the Bloms’ hard drive on Feb. 14.