N. D. Judge Dismisses Lawsuit Against Fargo Insurance Company

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A North Dakota judge has dismissed a lawsuit that sought to change the way one of the state’s largest insurance companies picks its board of directors.

Northwest District Judge Douglas Mattson of Minot ruled against the Ward County Farm Bureau, which has unsuccessfully challenged the management practices of Nodak Mutual Insurance Co. of Fargo.

“I hope it’s behind us,” Jim Alexander, the company’s chief executive officer, said Wednesday. “I don’t know what Ward County Farm Bureau will decide to do, but they’ve been defeated on several fronts.”

The Ward County Farm Bureau earlier asked Insurance Commissioner Jim Poolman to overhaul Nodak’s management practices, but a district judge and the North Dakota Supreme Court said Poolman could not be forced to make changes.

Ward County Farm Bureau president John Fjeldahl said he does not expect his group to appeal Mattson’s ruling.

“Some things finally got cleared up, I hope, so we can move forward and bring this to some sensible resolve,” Fjeldahl said.

Mattson also ruled against Nodak’s claim that the lawsuit was frivolous, which Fjeldahl said was more than a moral victory. “That’s a judge saying, ‘This is serious business,” Fjeldahl said.

The Ward County Farm Bureau has said Nodak should not be allowed to block potential candidates for its board of directors from running against incumbents. Several directors have been re-elected without opposition.

Company rules allow a nominating committee to screen prospective candidates to the Nodak board. It would take a 5 percent vote among about 26,000 policyholders to propose a change to that bylaw, Nodak officials said.

The Ward County Farm Bureau’s claim that most of its 1,200 members were policyholders of Nodak does not satisfy the 5 percent requirement, Mattson said. The judge also agreed with Nodak’s argument that a single policyholder does not have the right to propose new bylaws.

Fjeldahl said his group will try to secure the 5 percent needed to bring a proposal to the policyholders.

“We have a road map laid out for us, now we’ve got to do it,” he said. “Our goal has always been to give the control of our company back to the people.”

The Ward County Farm Bureau has twice nominated Max farmer Jim Lee as a potential candidate to the board, but the Nodak nominating committee declined to put him on the ballot.

Alexander said the recent lawsuit did not affect Nodak’s day-to-day operations.

“You certainly don’t want to see your company’s name in the press in a negative way, so it was a distraction,” Alexander said. “m glad to now be able to move forward and focus on providing products and services for our policyholders.”