Bollen Deposition

8/10/2019 Bollen Deposition

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1 JAMS MEDIATION

2

3 DARLEY COMMERCIAL, LLC, fka )

DARLEY INTERNATIONAL, LLC., a )

4 Delaware corporation, )

5 Claimant, )

6 vs. ) Case No. 1100054680

7 SOUTH DAKOTA INTERNATIONAL, )

BUSINESS INSTITUTE, an ) Before Arbitrator:

8 Administrative Unit of ) Hon. Robert A. Baines

Northern State University, ) (Ret.)

9 and HANUL PROFESSIONAL LAW )

CORPORATION, a California )10 corporation, )

11 Respondents. )

________________________________)

12 AND RELATED CROSS-CLAIM )

________________________________)

13

14 VIRTUAL DEPOSITION OF

15 JOOP BOLLEN

16 April 16, 2014

17 1:15 o'clock, p.m.

18 Taken at:

19 500 Capitol Building

20 Aberdeen, South Dakota

21

22 Reporter: Tammy Stolle, RPR23 JOB No. 1845808

24

25 PAGES 1 - 110

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1 APPEARANCES:

2

COUNSEL FOR CLAIMANT

3 BY: JENNIFER S. ELKAYAM (via telephone)

4 BLECHER COLLINS PEPPERMAN & JOYE, P.C.

5 515 South Figueroa Street, Suite 1750

Los Angeles, California 90071-3334

6 E-mail: [email protected]

7

COUNSEL FOR RESPONDENT SOUTH DAKOTA INTERNATIONAL BUSINESS

8 INSTITUTE9 BY: CHAKA C. OKADIGBO

10 GARCIA, HERNANDEZ, SAWHNEY & BERMUDEZ, LLP

700 N. Central Avenue, Suite 570

11 Glendale, California 91203


13

COUNSEL FOR RESPONDENT HANUL PROFESSIONAL LAW CORPORATION

14 BY: ALEX CHA (via telephone)

15 LAW OFFICES OF ALEX CHA

16 3435 Wilshire Boulevard, Suite 2000

Los Angeles, California 90010


18

COUNSEL FOR DEPONENT

19 BY: JEFFREY T. SVEEN

20 SIEGEL, BARNETT & SCHUTZ, LLP

P.O. Box 490

21 Aberdeen, South Dakota 57402


23

24 Also present:

25 James Stratmore (via telephone)

Page 3

1 I N D E X

2 WITNESS: PAGE NO.

3 JOOP BOLLEN

4 Examination - By Mr. Okadigbo 4

5 Examination - By Mr. Cha 105

6

7 EXHIBITS: MARKED

8 Exhibit 1 - October 7-8, 2007 E-mails 24

9 Exhibit 2 - Darley's amended claims against SDIBI 45

10 Exhibit and Hanul

11 Exhibit 3 - November 26, 2007 E-mail 47

12 Exhibit 4 - November 15, 2007 E-mail 52

13 Exhibit 5 - January 15, 2008 E-mails 58

14 Exhibit 6 - Articles of Incorporation 71

15 Exhibit 7 - Authorizations 77

16 Exhibit 8 - August 2009 Declaration of Joop Bollen 85

17 Exhibit 9 - SDIBI's Opposition to Notice to Hearing 92

18 Exhibit 10 - Memorandum of Understanding between SDIBI 99

19 and SDRC, Inc.

20 Exhibit 11 - Memorandum of Understanding between SDIBI 100

21 and SDRC, Inc.

22

23

24

25

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1 WHEREUPON,

2 the following proceedings were had, to wit:

3 JOOP BOLLEN, after being first duly sworn, testified

4 on his oath as follows:

5 EXAMINATION

6 BY MR. OKADIGBO:

7 Q. Can you state and spell your name for the record,

8 please?

9 A. Joop Bollen. First name J-O-O-P. Last name B as

10 in boy O-L-L-E-N.

11 Q. Okay. Mr. Bollen, where are you currently

12 employed?

13 A. I am currently employed at SDRC Incorporated in

14 Aberdeen, South Dakota.

15 Q. Okay. Actually we went too fast. Have you had

16 your deposition taken before?

17 A. No.

18 Q. Okay. I'm just going to give you a few rules

19 about depositions. One is that you are testifying under

20 penalty of perjury. Your testimony has the same force or

21 effect as testimony that you would give in trial.

22 I will be asking you about events that occurred a

23 while ago, you know, as far as back as 2007, maybe even

24 before that, 2003, so we would want your best recollection of

25 the events, but we don't want you to guess. The difference

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1 between, you know, a best estimate and a guess, for example,

2 I could say as far as an estimate, how long is this table and

3 you would have some way of gauging how long the table is

4 based on your experience with measurements, but a guess would

5 be something along the lines of how much change is in my

6 pocket, you don't know what I brought and you'd be totally

7 speculating.

8 A. Yeah.

9 Q. Okay. Have you taken any medication that you

10 feel would affect your ability to testify truthfully?

11 A. No.

12 Q. Or to give your best testimony today?

13 A. No.

14 Q. Okay. One other rule that we try to observe in

15 the depositions is that the court reporter can only take down

16 what one person is saying at a time, so it's important that

17 we don't talk over each other. I will try my best to allow

18 you to finish answering your questions and to only ask new

19 questions when you've finished responding to the questions

20 that I've asked, and then if, likewise, you could wait until

21 I finish the question so that we don't have a hanging

22 question, and then the record, you know, will be more clear

23 and complete that way. Do you understand?

24 A. Yes.

25 Q. Okay. So you just stated that you are currently

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1 employed at SDRC Inc., is that correct?

2 A. Correct.

3 Q. How long have you been employed at SDRC Inc.?

4 A. Roughly January 2010.

5 Q. Since January 2010, correct?

6 A. Yes, yes.

7 Q. Okay. Can you give us a brief, you know, summary

8 of your background in terms of your experience as you would

9 put it on a resume, let's say?

10 A. My education is a bachelor degree in economics

11 and computer science, and a master degree in international

12 business.

13 Q. Okay. But in terms of your work experience, can

14 you tell us a bit about that?

15 A. Work experience, traded grain for Continental

16 Grain. I worked for JP Morgan in New York.

17 Q. Okay.

18 A. And then started my own business while being

19 employed at Northern State University.

20 MS. ELKAYAM: I'm sorry to interrupt. Can the

21 witness please speak a little bit more directly into the

22 microphone or maybe move the microphone up a little bit.

23 We're having a hard time hearing.

24 Q. (BY MR. OKADIGBO) Okay. I had just asked the

25 witness to summarize his work experience and I guess since

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1 you couldn't hear what he said, I will ask the witness to

2 summarize again his work experience. This time also, could

3 you provide rough dates of --

4 A. Okay.

5 Q. -- when you worked at the various places?

6 A. Yeah. Right out of graduate school, '87, worked

7 approximately a year and a half with Continental Grain

8 Company. After that, worked approximately a year for JP

9 Morgan, then started my own business in Atlanta, Georgia.

10 Came to South Dakota permanently in '93, started my own real

11 estate business while I was being hired by Northern State

12 University.

13 Q. And when were you hired by Northern State

14 University?

15 A. Approximately January 1994.

16 Q. And when you were hired at Northern State

17 University, what was your -- what was the position that you

18 were hired by Northern State University?

19 A. I was requested to set up an entrepreneurial

20 program, international program, that initially would assist

21 state government and the federal government to increase

22 international business from the State of South Dakota while

23 giving an opportunity to Northern's international students to

24 gain some practical experience.

25 Q. Okay. Can you tell us what the official title of

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1 the position you held back then was?

2 A. It was director, and the name South Dakota

3 International Business Institute was established around that

4 time frame.

5 Q. Okay. Can you tell us what the South Dakota

6 International Business Institute is?

7 A. Well, it's just a name. It's not a legal entity.

8 It's the name that we came up with in the school of business

9 at Northern State University.

10 Q. Okay. So it's part of Northern State University?

11 A. It's part of the school of business, yes.

12 Q. Okay. And what is -- I guess, what was the

13 function of -- we'll just say SDIBI for short.

14 A. Yeah, the function was to assist the state

15 international business efforts, as well as the federal

16 international business efforts, to expand international

17 business mainly focusing at export at that time from the

18 State of South Dakota while giving Northern's international

19 business majors a chance to gain some practical experience.

20 Q. Okay. Then I take it from documents I've read

21 that eventually SDIBI got involved in the EB-5 visa

22 investment program, is that correct?

23 A. Eventually.

24 Q. Okay. Can you tell us, first of all, to people

25 who don't understand this area, what is the EB-5 visa

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1 investment program?

2 A. The U.S. government has several ways to obtain

3 green cards through employment based categories. You have a

4 family based group, which it's not part of, but you also have

5 an employment based way of getting green cards, that's

6 employment based, EB. There's EB-1, EB-2, EB-3, EB-4, EB-5.

7 EB-1 through EB-4 typically is for employment purposes is the

8 way I understand it, to where a U.S. business cannot find the

9 proper employees locally and therefore are able to attract

10 foreign people to come to the U.S.

11 The EB-5 is a little bit different. That is

12 where the foreign national actually will create jobs for U.S.

13 legal immigrants and U.S. citizens by making a qualified

14 investment.

15 Q. Okay. Can you describe how the decision to

16 get -- well, let me see. Can you describe how SDIBI first

17 got involved in what you've just described, the EB-5

18 investment program?

19 A. Okay. Well, SDIBI really focussed on export

20 promotion, that was the sole focus of the institute

21 initially. Typically every state has, from an international

22 business perspective, activities that focus on promoting

23 exports for job creation, but also they have foreign

24 investment where they'll try to attract foreign investment to

25 a state in order, again, to create jobs.

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1 SDIBI initially, as I mentioned, focussed just on

2 export promotion. We had an array of different services

3 available to companies in South Dakota teaching them the nuts

4 and bolts of how to engage in international business,

5 seminars. We would offer credit reports, counseling

6 sessions, all kinds of different activities so that South

7 Dakota would export more from the state. That was the focus.

8 The relationship was such that the Governor's

9 Office of Economic Development was interested in bringing the

10 activities of Northern State University to Pierre, but for a

11 variety of reasons, that was not possible, and the governor

12 at that time, Bill Janklow, decided that he would bring the

13 export portion of international business to Northern State

14 University under contract between the Governor's Office of

15 Economic Development and Northern State University.

16 Q. Okay.

17 A. Then later on, because the governor did like what

18 was happening on the export side, he asked if we could also

19 develop a program that would attract foreign investment to

20 the State of South Dakota.

21 Q. Okay. And I take it that at some point in

22 SDIBI's, I guess, initial forays into the EB-5 investment

23 program, a regional center was created in South Dakota, is

24 that correct?

25 A. Yes.

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1 Q. Okay. Can you describe what the regional center

2 is or how that fit into the picture that you've just

3 described in terms of the EB-5 program?

4 A. The typical EB-5 program, in order to qualify,

5 you would have to invest a million dollars and create ten

6 direct jobs. Under a pilot program that the USCIS

7 implemented, you are allowed to use some kind of a

8 multiplier, it's an econometric model so that you can count

9 both direct and indirect jobs, that's really the benefit of a

10 regional center because it allows indirect job counting.

11 Q. Okay. In terms of -- for people that don't know

12 how the EB-5 program works, if -- I assume the regional

13 center was involved in selecting projects for foreign

14 investors to review and decide whether to invest in it, is

15 that correct?

16 A. I wouldn't say that. I would say that initially

17 we will receive a lead that would come from the governor's

18 office or the department of agricultural that there is a

19 project that the state has an interest in. I would then

20 forward the contact to the entity that we had a working

21 relationship with, and they then would obtain the information

22 directly from the project typically and they would then do

23 the due diligence of the project and decide if their

24 investors want to get involved in that project or not.

25 Q. Okay. Well, let me ask this. What is the

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1 difference between a project using the regional center versus

2 people just investing directly into the project? What did

3 the regional center add in terms of --

4 A. It's the access to the green card. That is the

5 prime motivation of the investors. It's not a traditional

6 investment where people are looking at return on their money.

7 Their real return is typical, obtaining a U.S. immigrant

8 visa.

9 Q. Okay. And if I understand you correctly, people

10 couldn't -- foreign investors could not obtain a visa under

11 that EB-5 program without going through the regional center?

12 A. No, they had -- that's the traditional program.

13 Q. Okay.

14 A. But under the traditional program, they would

15 have to invest a million dollars.

16 Q. Okay.

17 A. And create ten direct jobs.

18 Q. Okay.

19 A. If you went through a regional center, and

20 especially a rural area like South Dakota, which --

21 Q. Right.

22 A. -- just for some exception is considered rural,

23 the investment threshold would drop to 500,000 and you would

24 be able to count indirect jobs based on the econometric model

25 that the USCIS has already approved for us.

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1 Q. Okay. And again, you said that SDIBI did not

2 select the project, but rather was -- rather received the

3 project from the governor's office?

4 A. There's a variety of different sources. Some

5 projects were recommended by the governor's office. Some

6 projects came from the department of agriculture. Some

7 companies would contact us, but we purposely would not go

8 into the due diligence aspect of the project. First of all,

9 we do not have the resources to do that, but we also wanted

10 to distance ourselves from that, so we would just connect the

11 project, for example, to Hanul who then would communicate

12 directly and obtain the right information, and they might ask

13 me to help them with the communication, but the information

14 would flow typically directly to Hanul and they would then

15 check in the early -- especially in the earlier time frame.

16 Q. Okay.

17 A. They would then check whether or not their

18 investors have an appetite for this kind of project.

19 Q. Okay. Well, let's -- when, in terms of a year,

20 when was the regional center first operational in South

21 Dakota?

22 A. Well, it started off with dairies, and so the

23 best I recall, I would guess around -- sorry, if guessing is

24 allowed -- somewhere around 2005 or so that were the first

25 dairy projects that showed an interest in utilizing -- no,

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1 it's probably -- yeah, around 2005.

2 Q. Okay.

3 A. To where they showed some interest in utilizing

4 the regional center in order to obtain a green card for dairy

5 operations. Initially, these projects were foreign nationals

6 that would come here, or already came here on a non-immigrant

7 E-2 Visa, if they already came here, it would provide them an

8 opportunity for more security, changing the non-immigrant

9 visa to an immigrant visa. Those projects there was

10 typically no outside investment. They -- it's a family farm

11 that would invest their money, build a farm and operate it

12 themselves, that was the first grouping of dairy projects

13 that came to the State of South Dakota. Later, there were

14 some dairy farms but with South Dakota partners that were

15 established.

16 Q. Okay. Well, let me ask this. Prior to -- prior

17 to October 2007, you just -- well, you just stated, or you

18 stated in your testimony earlier that SDIBI would pass on or

19 forward these projects that it received to persons or

20 entities who presumably would do the marketing and recruiting

21 if they were -- if they, I guess, found it suitable to pass

22 on, is that correct?

23 A. Um-huh, that's correct.

24 Q. Okay. What entities or persons did SDIBI use for

25 marketing and recruitment prior to October of 2007?

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1 A. What -- can you restate that question?

2 Q. Okay. Who were the people or the companies that

3 SDIBI forwarded these projects to, you know, to market, in

4 terms of getting foreign investors?

5 A. Hanul.

6 Q. Hanul, okay. Was it only Hanul before October of

7 2007, or were there other companies that were involved in

8 marketing and recruitment?

9 A. You know, we tried with some other companies for

10 South America, but Hanul was the only one that was

11 productive.

12 Q. Okay. And how early did Hanul get into the

13 picture in terms of marketing and promoting EB-5 projects?

14 A. Shortly -- after we obtained regional center

15 status, which I believe was in April of 2004. In June of

16 2004 is where I met Mr. Park in Korea, and at that point we

17 started communicating and discussing ways to collaborate.

18 Q. Okay. And then in terms of countries, did

19 Hanul -- what countries did Hanul recruit, or market or

20 recruit investors from?

21 A. Korea. Mainly Korea.

22 Q. Okay. Prior to October 2007, how would you

23 describe the business relationship between Hanul and SDIBI?

24 A. I would put -- Hanul had a dual function; the

25 immigration attorney that would prepare the I-526s to be

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1 submitted to the USCIS, and at the same time they would also

2 be the entity that would source the investors. In addition

3 to that, they are the ones that would prepare the materials

4 in order to attract the investors.

5 Q. Okay. Just so that I understand your testimony,

6 when you say that they're an entity that would source

7 investors, is that the same thing as saying the entity that

8 would market and promote these EB-5 projects to get these

9 foreign investors to invest in the projects?

10 A. Yeah, that's correct.

11 Q. Okay. And when you say preparing materials, you

12 mean whatever promotional materials are sent to these

13 potential investors to -- for them to decide whether to

14 invest in these projects?

15 A. Such as an offering memorandum, subscription

16 agreement, partnership agreement. Hanul would prepare all

17 those documents.

18 Q. Okay. So prior to October 2007, did SDIBI ever

19 receive any moneys directly from these EB-5 foreign

20 investors?

21 A. No.

22 Q. Okay. Can you tell us how it is -- I assume

23 Hanul got paid for its efforts, correct?

24 A. Yes, I assume too, yeah.

25 Q. Okay. So if I'm understanding your testimony and

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1 kind of reasoning from that, Hanul would get paid for doing

2 the immigration work?

3 A. Um-huh, yes.

4 Q. Okay. And they would also get paid for doing the

5 promotional work, is that correct?

6 A. I am -- yes, that's correct.7 Q. Okay.

8 A. Although I did not get involved in that aspect

9 because it was not my business.

10 Q. Okay. So -- right. So I assume that the

11 investor would pay -- he would pay his 500,000 for the

12 project?

13 A. Um-huh.

14 Q. And then additional moneys for processing the

15 visa petition and a separate batch for the promotion -- to

16 the promoter for the promotional efforts, is that correct?

17 A. That's correct.

18 Q. Okay. And SDIBI didn't receive any of these19 moneys, correct?

20 A. Correct.

21 Q. Okay. Did SDIBI and Hanul ever have a written

22 agreement --

23 A. No.

24 Q. -- between them?

25 A. No.

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1 Q. Okay. You just stated that SDIBI and Hanul did

2 not have a written agreement with them ever, is that correct?

3 A. Correct.

4 Q. Okay. But Hanul nevertheless still did this

5 marketing and -- marketing work and processing the visa

6 petitions work, correct?

7 A. Correct.

8 Q. Did you ever make -- did you ever make any

9 guarantees to Hanul that SDIBI would use Hanul exclusively

10 to -- for its marketing and promotion for any particular

11 period of time?

12 A. No.

13 Q. Did -- okay. I take it the main person at Hanul

14 was James Park, is that correct?

15 A. Correct.

16 Q. He's the person you dealt with mainly from Hanul?

17 A. Correct.

18 Q. Okay. Did James Park at any point ever ask you

19 for a formal written agreement between SDIBI and Hanul?

20 A. Very early on, but I explained to him the

21 constraints that I was operating under and he understood

22 those.

23 Q. Okay. Can you just tell us briefly what did he

24 ask you for in terms of what do you recall about him asking

25 you for an agreement and then what do you recall telling him

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1 in response to that?

2 A. Well, just like everybody else, they immediately

3 like an exclusive agreement, not just James Park but all the

4 other people that approached me, and I explained to them very

5 early on that we are doing somewhat entrepreneurial

6 activities in a very bureaucratic setting and that if you

7 want to get these kind of agreements signed, you might as

8 well not even conduct business with us because it's not going

9 to effectively happen.

10 Q. Okay. Do you recall, was it one conversation

11 that you had with Mr. Park about that?

12 A. I don't recall exactly when we had this

13 conversation, but it is the same conversation that you pretty

14 much have with anybody you meet initially who is interested

15 in working with us.

16 Q. Okay. Do you think this conversation happened

17 sometime early in the relationship between --

18 A. Probably immediately in June 2004.

19 Q. Okay.

20 A. While I met him in Korea.

21 COURT REPORTER: Make sure you wait until he's

22 done asking the question. They might not be able to hear

23 well either.

24 THE WITNESS: Okay.

25 Q. (BY MR. OKADIGBO) Okay. And then as I

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1 understand it, eventually SDIBI -- well, actually I should

2 say eventually there were initiatives to do marketing and

3 recruitments in China for these EB-5 projects, is that

4 correct?

5 A. China and other parts of the world.

6 Q. Okay.

7 MR. SVEEN: Anybody there?

8 MR. STRATMORE: Yes, hello, this is Robert

9 Stratmore on the phone.

10 MR. OKADIGBO: Is everybody else still on the

11 phone?

12 MS. ELKAYAM: Yes, I'm here, Jennifer Elkayam.

13 MR. CHA: And I am, Alex Cha.

14 MR. OKADIGBO: Okay. So everybody's still here,

15 okay.

16 Q. (BY MR. OKADIGBO) Now it's my understanding from

17 materials I've read that at some point you were contacted by

18 a Robert Stratmore, is that correct?

19 A. Correct.

20 Q. And was he -- what company was he from?

21 A. Now I know Darley. At that time, it was just one

22 of the typical calls that somebody has heard about the

23 regional center and is interested in representing the

24 regional center.

25 Q. Okay. Do you remember approximately what year

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1 and month Mr. Stratmore called you?

2 A. 2007 sometime, I would think, early to mid-2007.

3 Q. Okay. Was Mr. Stratmore's contact with you first

4 by a call or through some other method like an e-mail?

5 A. If I recall correctly, it was James Park --

6 MR. STRATMORE: Are you speaking to Robert

7 Stratmore?

8 MR. OKADIGBO: I'm speaking to the deponent.

9 MR. STRATMORE: Oh, I thought you mentioned my --

10 MR. OKADIGBO: You've logged in because you want

11 to hear what the deponent is saying, but you're not being

12 deposed.

13 MR. STRATMORE: Sorry.

14 MR. OKADIGBO: Joop Bollen is being deposed.

15 A. I -- what I remember is when he contacted me,

16 just like any other international inquiry, pretty much I

17 would spin him off and have him contact James Park.

18 Q. (BY MR. OKADIGBO) Okay. So, and you said this

19 was early 2007 sometime?

20 A. That is my recollection, sometime mid, early

21 2007.

22 Q. Okay. Do you recall, or can you tell us as best

23 you remember your conversations with -- or your conversation

24 with Mr. Stratmore when he initially contacted you?

25 A. It wasn't an exceptional conversation. It was

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1 just a conversation like many other agents who would call us

2 and say, "Hey, we hear you have a regional center. We are

3 interested in promoting it." Depending on what area of the

4 world it was, I would just -- but pretty much connect them

5 straight to Hanul and let James handle it.

6 Q. Okay.

7 A. Except for some dairy projects that we would try

8 to do with the department of agriculture for South America.

9 Q. Okay. Do you recall if Mr. Stratmore asked you

10 about whether his company could have the exclusive rights to

11 market in China during that conversation?

12 A. I don't recall that specifically, but again,

13 anybody immediately tries to hone in on exclusive, even

14 before they have proven their ability, or even though I know

15 who I'm dealing with before I know who I am dealing with.

16 Q. Okay. Why did you connect them to Hanul?

17 A. The reason why I connect them to Hanul is because

18 of the constraints I'm on, under, I cannot sign agreements

19 with outside entities. Hanul is a seasoned law firm that

20 knew my constraints and knew how to work with my constraints

21 and still produce for the State of South Dakota.

22 Q. Okay. So I take it after your call or after your

23 talk with Mr. Stratmore, the next phase in terms of his

24 involvement or attempt to get involved in the EB-5 investment

25 arena was to follow up with Hanul, correct?

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1 A. That is correct.

2 Q. Okay. And it's my understanding that -- or it's

3 pretty well established that Hanul and Darley ultimately

4 enter into a contract, right?

5 A. That's correct.

6 Q. In October -- sometime in October 2007, correct?7 A. That appears to be correct.

8 Q. Okay. In terms of the contract negotiations

9 between Darley and Hanul, did you have any role in the

10 contract negotiations --

11 A. No.

12 Q. -- with the Darley-Hanul contract?

13 A. No.

14 Q. Okay.

15 A. Well, any role? Maybe I should specify that.

16 Q. Okay.

17 A. Stratmore and Hanul knew the constraints, they

18 knew what I was able to do and what I was not able to do.19 Both -- Stratmore appeared to be a seasoned lawyer. They

20 knew how to work together around my constraints. So from

21 that perspective, everybody knew what the rules of the game

22 was, so they were communicating. What was unique and

23 somewhat exceptional is that Stratmore would call me, even

24 late at night, asking certain questions which I understood

25 since he's not familiar with James Park, he was feeling me

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1 out from what can and what cannot be done with Hanul, but I

2 did not see that as participating in the contract whatsoever.

3 Q. Okay. I have some e-mails and I just want to

4 clarify --

5 MR. OKADIGBO: Folks, I'm going to pass Mr.

6 Bollen, I guess, a two-page e-mail initially. I forwarded --

7 so to the attorneys I forwarded you the pdfs of the documents

8 that I'll be questioning him on, but you can also follow it

9 by Darley's Bate stamp numbers which is DI000896, so 896 and

10 897. Will you -- do you want me to wait for you to find

11 those documents, or are you good to go?

12 MS. ELKAYAM: Can you just repeat the Bates

13 numbers again, and I'll find them?

14 MR. OKADIGBO: Okay. So they're 896 of your

15 documents, Jennifer.

16 MS. ELKAYAM: Okay.

17 MR. OKADIGBO: 896 and 897.

18 MS. ELKAYAM: Okay. Thank you.

19 MR. OKADIGBO: Yeah. Are you good to go, Alex?

20 MR. CHA: Yeah, I'm good to go.

21 MR. OKADIGBO: Okay. Hold on a second. We'll

22 mark it as Exhibit 1.

23 (Exhibit No. 1 was marked.)

24 Q. (BY MR. OKADIGBO) I'm showing the witness

25 Exhibit 1, what's marked as Exhibit 1, which again is Darley

Page 25

1 Bate stamp numbers 000896 to 897, and it is an e-mail, or set

2 of e-mails, the first -- right at the top stating an

3 October 8th, 2007 date. Can you look at that set of e-mails,

4 Mr. Bollen, and let me know when you've reviewed them?

5 A. (Witness reviewing exhibit.)

6 MS. ELKAYAM: Chaka?

7 MR. OKADIGBO: Yes.

8 MS. ELKAYAM: I notice in some -- and I don't

9 know if this is just a matter of the copies that you have

10 scanned in, but there's several documents within the ones

11 that you're planning to use that I don't have Bates numbers

12 on them and I don't recall seeing them, so I'm wondering, are

13 these new documents, or have these been produced and you're

14 just using copies without Bates numbers?

15 MR. OKADIGBO: Yeah, so in other words, I -- to

16 answer your question, I'm not using any documents that have

17 not been previously produced.

18 MS. ELKAYAM: So the versions that you're using

19 just don't have Bates numbers on them, is that right?

20 MR. OKADIGBO: Correct.


22 MR. OKADIGBO: Unfortunately when Jim Lynch

23 initially produced documents on behalf of SDIBI, he did not

24 Bate stamp them is my understanding, or at least I don't have

25 Bates numbers for SDIBI. I could be wrong.

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Page 26

1 MS. ELKAYAM: But some of them were Bate stamped

2 and it's possible that some were not. I'll have to ask our

3 paralegal because there is some issue with viewing some of

4 the documents you guys produced in our, you know, document

5 management system, so maybe that -- maybe there was two

6 different productions, I'm not sure.

7 MR. OKADIGBO: Okay.

8 MS. ELKAYAM: But that's -- but you're

9 understanding is that he produced, I'd have to to go back and

10 look, without Bates numbers because there are some that do

11 have Bates stamped?

12 MR. CHA: My understanding is that they were not

13 Bate stamped, so...

14 MS. ELKAYAM: I believe some of them were.

15 MR. CHA: Maybe some of them, but not all of

16 them.

17 MS. ELKAYAM: Let me go back and check.

18 MR. OKADIGBO: I guess let's just go off the

19 record briefly because the court reporter doesn't need to

20 take this part of the conversation down.

21 (A break was taken.)

22 Q. (BY MR. OKADIGBO) We're back on record.

23 Everybody there?

24 MS. ELKAYAM: Jennifer Elkayam is here.

25 MR. CHA: Alex Cha is here.

Page 27

1 Q. (BY MR. OKADIGBO) All right. So, Mr. Stratmore,

2 I've shown you --

3 MR. SVEEN: No, Bollen.

4 Q. (BY MR. OKADIGBO) Sorry. Bad mistake. Both

5 persons are probably insulted; Mr. Stratmore on the phone and

6 Mr. Bollen here in person. Apologies. Will never confuse

7 you two again.

8 Mr. Bollen, I have given you a copy of e-mails

9 that were sent to you. Do you recall receiving these

10 e-mails?

11 A. After reading them, yes.

12 Q. Now it appears from these e-mails that you were

13 involved in discussing the issue of, quote, exclusivity which

14 I take to mean the issue of whether Darley International

15 could be -- well, I don't know what that means. I guess you

16 could explain to me what your involvement in the contract

17 negotiations was in relation to the topic of, quote,

18 exclusivity that appears in these e-mails?

19 A. Well, again, I think both Hanul and Stratmore

20 clearly knew my constraints, that I'm not able to enter in

21 any agreements. They were communicating together. Now where

22 Mr. Stratmore is unique, he would call me at work, in the

23 evening, asking questions, and initially I took those

24 questions from, look, there is opportunity, we need to take

25 advantage of the opportunity for South Dakota. Mr. Stratmore

Page 28

1 doesn't know James Park quite as well as I do and therefore,

2 if Mr. Stratmore asks me questions, yeah, I will answer. I'm

3 not going to be rude and just hang up the phone on him. They

4 again knew my constraints very, very clearly that I cannot

5 enter into agreements, and therefore, those two seasoned

6 lawyers were working together to work under my constraints.

7 Q. Okay. And just for clarification, when you say

8 Mr. Stratmore knew your constraints, are you stating that you

9 told him, you told Mr. Stratmore at some point in time that

10 his company, or he or his company could not have an official

11 agreement with SDIBI or the State of South Dakota?

12 A. That would be my standard response to anybody who

13 would call me and ask for some kind of a relationship.

14 Q. Okay.

15 A. I would tell them right away, "These are my

16 constraints; therefore, I'm going to recommend you to

17 somebody else."

18 Q. Okay. And you recall stating that to Mr.

19 Stratmore?

20 A. I don't recall specifically stating that to him,

21 but that is a standard response to anybody.

22 Q. Okay.

23 A. And we did the same with dairy projects where I

24 would spin them off to somebody else.

25 Q. During the negotiations between Darley and Hanul,

Page 29

1 had you -- did you see any versions of the drafts of the

2 contracts between the parties?

3 A. I'm -- again, I felt it is not my role to

4 participate, so -- and I'm inundated with e-mails, so even if

5 I see some correspondence going back, I definitely did not

6 spend the time to analyze it or go into great detail --7 Q. Okay.

8 A. -- looking at the agreements. Again, my view was

9 this is between Hanul and Darley.

10 Q. Can you tell us, I assume at some point you -- at

11 some point you reviewed the agreement --

12 A. Yes.

13 Q. -- between Darley and Hanul?

14 A. Um-huh.

15 Q. Okay. Do you recall roughly when it was that you

16 first saw a full copy of the agreement?

17 A. It was after it became clear that Darley and

18 Hanul were not coming to terms so that had to be somewhere19 very late 2007 or very early 2008.

20 Q. Okay. Now I take it that Hanul had decided at

21 some point to -- sorry, getting back to your response, you

22 said you first reviewed the contract when Darley and Hanul

23 were having problems, is that correct?

24 A. Correct.

25 Q. Okay. And I take it, but I don't want to assume,

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Page 30

1 so I'm asking you, that this was after the contract was

2 signed between the two parties, is that correct?

3 A. Correct.

4 Q. Okay. And if it was late 2007, early 2008, I'm

5 guessing it would have been at least two months after the

6 contract was signed, is that correct?

7 A. I believe the contract was signed somewhere

8 around October, and the real conflict between Hanul and

9 Darley seemed to have started early January, so yes, that is

10 correct.

11 Q. Okay. Well, since Darley and Hanul entered into

12 a contract, I guess it's clear that Hanul wanted to involve

13 Darley in the marketing and promotional efforts in China.

14 Did Hanul discuss with you its decision making as far as

15 involving Darley in the promotional efforts in China?

16 A. Well, what was unique is Robert Stratmore would

17 call me in the evening or in the daytime at my home, at any

18 time, bringing up the topic. So when the topic was brought

19 up, I did communicate to James what the conversation with

20 Stratmore was about.

21 Q. Okay. So I'm just trying to follow your series

22 of communications with Mr. Stratmore.

23 A. Um-huh.

24 Q. You told us that you had an initial conversation

25 with him where you essentially passed him onto --

Page 31

1 A. Park.

2 Q. -- James Park to discuss details?

3 A. Correct.

4 Q. And then presumably he discussed details with Mr.

5 Park and you're saying that he would still call you to

6 discuss other --

7 A. Yes.

8 Q. Other details?

9 A. Yes, he would -- compared to other agents, that

10 was exceptional because once I would spin off somebody, the

11 communication would continue between Hanul and that entity.

12 With Mr. Stratmore, it was exceptional that he continuously

13 kept communicating with me.

14 Q. Okay.

15 A. And asking questions, and I looked at it

16 initially from he knows I know James, so he tries to get some

17 insight into what James Park might want to do, and therefore

18 I just didn't want to be rude to him and hang up on him, even

19 if he made calls eight, nine o'clock at night to my house,

20 and I thought it would be for the best interest of South

21 Dakota to have these parties get together under whatever

22 terms they agreed to and be productive for the State of South

23 Dakota.

24 Q. Okay. Well, let me ask you this. Between the

25 time that you first referred him to James Park; Mr.

Page 32

1 Stratmore, that is, and when they signed the contract in

2 October, what is your recollection of -- you know, how many

3 times would you say you talked to Mr. Stratmore in that

4 period?

5 A. I would think probably ten plus times.

6 Q. Okay.

7 A. Because he -- it stood out in my mind that he

8 continuously kept calling.

9 Q. Okay.

10 A. Much more than what is usual.

11 Q. Okay. And what was he calling about as far as

12 you could remember during those ten --

13 A. Initially it --

14 Q. -- conservations? Sorry, just to finish. During

15 those approximately ten conversations before the contract was

16 signed, what was he calling you about?

17 A. I felt that he was trying to pick James Park's

18 brain through me as I knew him better, that is how I observed

19 those conversations.

20 Q. Okay.

21 A. So he knew that I had a good working relationship

22 with James Park, he knew that I knew James Park a lot better

23 than him, and therefore, he was trying to get an insight into

24 James Park's thinking by talking to me, that is how I

25 observed the -- experienced his conversation initially.

Page 33

1 Q. Okay. But what topics was he bringing up to you,

2 even though he was gauging James Park's --

3 A. I think territories. He would bring up anything,

4 pretty much anything.

5 Q. Okay.

6 A. I don't have a very specific recollection, but it

7 was just anything under the sun, from maybe what kind of

8 personality he is to more specific things related to where he

9 thinks he has real strength in operation which appear to be

10 Russia and those areas.

11 Q. Okay. Do you remember whether during any of

12 those conversations between when you first talked to him and

13 October 2007, do you recall whether Mr. Stratmore made any

14 representations to you about his company's -- Darley

15 International's capabilities of recruiting investors in

16 China?

17 A. Yes, he did, but again, that is not unusual.

18 Anybody who would call me during that time -- and we were one

19 of the first regional centers, so I became inundated with

20 these kind of calls -- would always somewhat tout their

21 ability to recruit, and 99 percent of that kind of response

22 ends up in nothing.

23 Q. Okay.

24 A. So there's a lot of wannabes who want everything

25 under the sun, but they have absolutely no ability to

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Page 34

1 produce.

2 Q. Okay.

3 MR. SVEEN: Can I just ask a question? I'm

4 looking at this recruiting document and it doesn't seem to be

5 dated. Is there a date when it was supposedly signed?

6 MR. OKADIGBO: 17th or 18th of October roughly.

7 MR. SVEEN: Okay.

8 MR. OKADIGBO: We know that because it was in an

9 e-mail that attached the document.

10 MR. SVEEN: Okay. Just wondering.

11 MR. OKADIGBO: Yeah.

12 A. So I really didn't pay any importance to it.

13 Q. (BY MR. OKADIGBO) Right.

14 A. The exhibit that you showed me would have been

15 somewhat of a surprise too because I spun him off to James,

16 and then James asked Stratmore to contact me directly which

17 is also unusual.

18 Q. Okay. Well, can you tell us as best as you can

19 remember what Mr. Stratmore said, if you can remember, about

20 his operations in China, if he said anything about that or

21 his recruiting abilities in China?

22 A. Again, I did not pay too much attention because

23 we got inundated with these kind of conversations. What I

24 remember more is his supposedly incredible success stories in

25 Russia with different ventures, horses and whatever else.

Page 35

1 That stands out because that is unusual. All the other style

2 of conversations or the content of these conversations are

3 very similar to what I have with other people who think that

4 they can be an agent and successfully promote EB-5 programs.

5 So I didn't spend a lot of focus on what he was saying in

6 terms of what his abilities are because the proof is in the

7 pudding and most of the pudding is not very good when it

8 comes to an agent contacting me.

9 Q. Okay. But the decision to have him involved in

10 marketing and recruiting for EB-5 projects in South Dakota,

11 was that a decision of yours or Hanul's decision?

12 A. It was up to Hanul. Hanul decided --

13 Q. Right.

14 A. -- that they wanted to enter into a contract with

15 Darley.

16 Q. Okay.

17 A. Knowing the constraints that we have from a state

18 perspective.

19 Q. Okay. So a contract was executed, I'm pretty

20 certain it was October 17 or 18, 2007. Do you have a

21 recollection of what the first project after that contract

22 was signed, what the first project, EB-5 project was?

23 A. The tilapia project.

24 Q. Okay. Can you describe what the tilapia project

25 is?

Page 36

1 A. This was a project that was introduced to us by

2 the South Dakota Department of Agriculture. They were

3 interested in potentially working with a group of

4 entrepreneurs in the Pierre region and they asked if maybe

5 EB-5 could be a solution to provide some financing for this

6 particular project. What I did at that time is I had

7 introduced Cheri Rath who worked for the department of

8 agriculture to James Park and they exchanged information on

9 the project and provided James Park with the information that

10 he needed about the project.

11 Q. Okay. Now in terms of the decision as to whether

12 that project should be marketed or not to potential EB-5

13 investors, did you make that decision?

14 A. No, I don't make the decision, but I obviously do

15 not want a project that would guarantee fail either for the

16 regional center because it would affect the reputation of the

17 regional center.

18 Q. Okay. So can you describe or tell us what

19 happened in terms of the recruiting efforts for that tilapia

20 project?

21 A. The materials -- Hanul in that particular case

22 communicated directly with the tilapia plant. The majority

23 of financial information would be forwarded to Hanul. They

24 then would prepare the necessary documents to market the

25 project. They then would share the information with whoever

Page 37

1 they want to work with, and those people would be responsible

2 for doing the due diligence on the project to make sure that

3 that project was feasible.

4 With dairy projects up to the tilapia portion,

5 what we would do is somewhat follow the same format. The

6 information on a particular dairy project would be forwarded

7 to the potential investors. They then would sign an MOU with

8 SDIBI holding the state and everybody harmless. They would

9 realize that they are allowed to use the economic development

10 tool of the regional center completely and fully at their own

11 risk.

12 With the tilapia project, the job creation was so

13 large, that suddenly bank financing was no longer needed and

14 therefore the due diligence completely relied on whoever that

15 was going to promote the tilapia project, which was Hanul and

16 in this case, Robert Stratmore.

17 Q. Okay. Did you have conversations -- before the

18 promotion began, did you have conversations with either Mr.

19 Park or Mr. Stratmore about due diligence responsibilities in

20 terms of assessing the financial wherewithal or not of the

21 tilapia project?

22 A. Well, with -- especially with Mr. Park, we had a

23 working relationship. They knew that each investor had to

24 sign an MOU that would hold SDIBI completely harmless, that

25 was our working -- normal working practice. So with the

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Page 38

1 tilapia, it was nothing new. They knew that they're going to

2 sell it to their investors and their investors would put

3 their money at risk; so therefore, the vetting was done by

4 their investors and by Hanul and as well as Mr. Stratmore.

5 Q. Okay.

6 A. And whoever else who might have been interested

7 in putting their money. Certainly if you represent to your

8 client, you don't want them to lose money, so you want to

9 make sure --

10 Q. Right.

11 A. -- that the project is feasible and has a good

12 chance for success.

13 Q. Okay. And I guess my next question is what

14 happened with the tilapia project, did that ultimately end up

15 recruiting and -- were investors ultimately recruited for

16 that project or no?

17 A. They were not recruited.

18 Q. Okay.

19 A. As I mentioned with the dairy farms, and that was

20 the only style project we were used to to that time, bank

21 financing was always 50 percent, so the involvement of the

22 bank gave confidence that the project was going to be

23 feasible because the bank is not going to lend money unless

24 they feel the project is solid. Tilapia was unique because

25 of the job creation, suddenly there was no bank needed. I

Page 39

1 relied on the Stratmores, the Hanuls, the investors to do due

2 diligence.

3 When we went to China to participate in an

4 agent's promotional event, that is -- and when I was

5 listening to the presentation, that is where I started

6 realizing there's a problem here. The agents did not7 properly vet this project and I thought there was a good

8 possibility that this project might not be feasible, and my

9 concern was that the reputation of the regional center would

10 be tarnished if we would have had a failed project.

11 Q. Okay. When was it -- I guess, can you describe

12 more how you discovered that the project wasn't properly

13 vetted, when did you discover that?

14 A. In China during a presentation, and my role in

15 that presentation was just to give a history of the South

16 Dakota Regional Center, and when I was listening to the

17 promotion of the project itself, which was done by a

18 gentleman by the name of Gary Myers, when he started19 dissecting the project, that is where I started feeling

20 uncomfortable. So I asked Mr. Myers to go to lunch with me

21 afterwards, and during that conversation, I found out that he

22 failed a very small scale tilapia project in Texas. So my

23 thinking was if you cannot be captain of a rowing boat, how

24 now do you expect to be a captain of a large ship, and that

25 is where it struck me like lightning, what are we doing here,

Page 40

1 this is dangerous. I then discussed this with Stratmore and

2 Hanul, and I said, "Do you want your investors to invest in

3 something that is so alarming," and then we all together

4 decided from -- this is too dangerous to continue.

5 Q. Okay. And this was in China, correct?

6 A. Correct.

7 Q. Do you remember what month and what year that

8 occurred?

9 A. December 2007.

10 Q. Okay. And it was during marketing seminars that

11 were put on, is that correct?

12 A. That is correct.

13 Q. And who was present at the seminars?

14 A. Some interested parties that had heard of this

15 potential EB-5 project. James Park was present. At that

16 stage he was playing the role of the immigration attorney

17 that would forward the I-526s of the potential investors that

18 decide to go with this particular EB-5 project. The

19 promotion of the project itself was being done by Gary Myers

20 who was the principal of the tilapia project. Mr. Stratmore

21 was there as well, and that is pretty much what I remember of

22 the people who were there.

23 Q. Okay. Do you remember whether there were any --

24 I guess the word we've used in discovery so far was

25 sub-agents. Do you remember if there were any Chinese -- and

Page 41

1 by using the word "sub-agents", I am not claiming, for

2 everyone to know, that those people were actually Darley

3 sub-agents. I'm just saying that's the parlance we've --

4 were there any persons from China -- yeah, let me put it this

5 way. Were there any persons from China that were assisting

6 in putting on these seminars?

7 A. What I remember is that Frank Lin was there.

8 Q. Okay.

9 A. And he -- and I remember at that time who later

10 became known as, I believe it was Cindy --

11 Q. Okay.

12 A. -- who was there.

13 Q. Was there a Linda there too?

14 A. I don't believe so. At the seminars.

15 Q. Right.

16 A. I recall that she wasn't there. Yeah, she was

17 not there.

18 Q. Okay. So to recap, you discovered these failings

19 on the part of the Gary Myers and then you had a conversation

20 with Mr. Stratmore and Mr. Park --

21 A. Right.

22 Q. -- about withdrawing the project, correct?

23 A. Oh, I pretty much repeated the story that I just

24 told you. See, you have this Gary Myers who went bankrupt on

25 a very small scale tilapia program, now you guys want him to

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Page 42

1 do a very large project? I certainly wouldn't want my

2 clients to invest their money in a project like that, and

3 what do you guys think? And it was a consensus from what do

4 we do? You know, again the convenience of bank financing

5 which was present in any other project we did up to that

6 point did not exist here, so we realized that the due

7 diligence that the bank normally did and the agent did was no

8 longer there and that was a big problem.

9 Q. And I think just a -- you stated that both Mr.

10 Park and Mr. Stratmore agreed --

11 A. Yes.

12 Q. -- to cancel the project?

13 A. My understanding we were all under the same

14 understanding from we are not going to work on a project that

15 has a very high probability of failing. It's in nobody's

16 best interest.

17 Q. Okay. Do you recall whether Mr. Stratmore at

18 that time ever complained to you about cancelling the

19 project?

20 A. No, not during the trip to China. I might add

21 that nobody was happy obviously because it wasn't good for

22 anybody here. We all spent our time there and our resources.

23 Q. Right.

24 A. But nobody disagreed --

25 Q. Right.

Page 43

1 A. -- and objected strongly.

2 Q. Okay. You say it wasn't good for anybody. Can

3 you state in terms of SDIBI's -- from SDIBI's perspective, it

4 might be obvious, but I just want to get it on the record,

5 why was it not good for SDIBI?

6 A. Well, because if you have a failed project,

7 especially one of the first larger ones, that is going to

8 tarnish your name in China and SDIBI would never be able to

9 recruit another project.

10 Q. Okay.

11 A. Or do another project, say it that way.

12 Q. I forgot to ask, in terms of the people that went

13 over, the people that you mentioned that were present at

14 these seminars in China, was Richard Bender who I take it at

15 that time would have been the secretary of the Department of

16 Tourism, was he there?

17 A. I don't recall.

18 Q. Okay.

19 A. I think Richard Benda's interest was more in the

20 beef project, not so much in the tilapia, but I cannot say

21 that for certainty, whether he was there or not.

22 Q. Okay. Now let me ask you this while on the

23 subject of tilapia. Have you reviewed the Complaint in this

24 case?

25 A. The Complaint?

Page 44

1 Q. By Darley International against SDIBI as one of

2 the parties. Let me show that to you actually.

3 MR. OKADIGBO: Speaking to other counsel, do you

4 want me to wait while you locate the Complaint, or is it fine

5 to go ahead?

6 MR. CHA: I'm good.

7 MS. ELKAYAM: Go ahead.

8 Q. (BY MR. OKADIGBO) Okay. We're going to mark it

9 as Exhibit 2, is that correct?

10 COURT REPORTER: Yes.

11 MS. ELKAYAM: Are you not continuing in the

12 same -- from the order that we started with Mr. Stratmore's

13 deposition? Are you starting over again?

14 MR. OKADIGBO: I'm sorry, I don't understand.

15 MS. ELKAYAM: Are you starting over with the

16 exhibit numbers for Mr. Bollen's deposition?

17 MR. SVEEN: Are you starting numbers over? You

18 are, 1 and 2, right?

19 MR. OKADIGBO: Yeah, this is just a second --

20 yeah, so I'm --

21 MS. ELKAYAM: Okay. I wanted to see if you were

22 continuing in consecutive number order from the last

23 deposition. Okay, thank you.

24 MR. OKADIGBO: No.


Page 45

1 MR. SVEEN: Do you want him to read any specific

2 part?

3 MR. OKADIGBO: No.

4 Q. (BY MR. OKADIGBO) Do you recall seeing that

5 Complaint?

6 A. Yes, um-huh.

7 Q. Okay. I'm going to ask you some questions about

8 it. Okay, can you go to page, I guess it's paragraph 17,

9 which is on page four of that Complaint. To briefly

10 summarize, paragraph 17 appears to claim that SDIBI promised

11 Darley -- or promised to provide Darley, quote, the necessary

12 marketing and recruitment materials related to the tilapia

13 project. Can you tell us, what was SDIBI's role in terms of,

14 you know, the duty to provide marketing materials?

15 A. Well, SDIBI never produced the materials. When I

16 read this, I'm thinking offering memorandum, those kind of

17 materials, and again, SDIBI would assist in getting the raw

18 materials to Hanul without really reviewing it. They then

19 would put these materials together. So in my mind, this

20 statement is wrong because SDIBI should not be part of that.

21 Q. Okay. And then in paragraph 19, that follows up

22 on the same theme, Darley is alleging that SDIBI promised

23 documents and information to enable the recruitment of --

24 A. Which is completely false.

25 Q. -- investors, but that didn't happen. Did you

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Page 46

1 make any promises that SDIBI will deliver documents to

2 Darley?

3 A. No.

4 Q. Okay. And then I'm going to have you look at

5 paragraph 20, and again, your best recollection, you may or

6 may not remember, we don't want you to speculate, but did --

7 well, I'll let you look at it for a second.


9 Q. Well, let me ask you this in connection with

10 paragraph 20, or is it 20? Yeah. Did you ever make any

11 assurances to Robert Stratmore about projects that SDIBI

12 would use Robert Stratmore for -- or I'm sorry, would use

13 Darley for --

14 A. No.

15 Q. -- in terms of marketing and recruiting?

16 A. No.

17 Q. Okay. We'll move away from that for now. I'll

18 show you another document.

19 MR. SVEEN: Can we take a couple minute break

20 while you're doing that?

21 MR. OKADIGBO: Let's do that, take a break. So

22 five minutes, everybody.

23 (A break was taken.)

24 Q. (BY MR. OKADIGBO) I'm going to show the witness

25 what is Darley Exhibits DI001253 and 001254. In the pdf

Page 47

1 pages that I sent both of you by e-mail, it begins page eight

2 of the pdf. We'll mark it as Exhibit 3.


4 Q. (BY MR. OKADIGBO) Mr. Bollen, do you recall

5 receiving the document that I've put in front of you?

6 A. Now I do.

7 Q. Okay. And just for the record, it's an e-mail,

8 the top part, dated November 26, 2007. The very first e-mail

9 in the series is from Mr. Bollen to Mr. Stratmore under his

10 [email protected] e-mail address saying, "Thank you," and

11 then there's another e-mail before that. Mr. Bollen, do you

12 recall being -- as you look at this e-mail, do you recall

13 being advised as to the entities or persons Darley was

14 claiming as sub-agents in China?

15 A. No.

16 Q. Okay. But you do see that this e-mail was sent

17 to you though, right?

18 A. Right. It's made out -- it's actually sent to

19 James Park and then it starts, "Dear Frank and Joop." I'm

20 CC'ed there, but it's kind of funny to see James Park as the

21 addressee and then the actual writing is to Frank and I.

22 Q. Okay. But in any event, I take it that Darley is

23 contending that the six persons stated on page 1253 are

24 Darley's sub-agents. Let me ask this. As far as you know,

25 has SDIBI ever used Dr. Walter Chen --

Page 48

1 A. No.

2 Q. -- to do -- sorry, let me just finish to get a

3 clear record.

4 A. I'm sorry.

5 Q. Has SDIBI ever used Dr. Walter Chen to do -- or

6 to handle marketing and promotion of EB-5 projects in China?

7 A. That's the first time I saw his name, so no.

8 Q. Has SDIBI ever entered into any written

9 agreements with Dr. Walter Chen?

10 A. No.

11 Q. Has SDIBI ever entered into any written

12 agreements with PRC Historical Educational (Holdings)

13 Company, Limited?

14 A. No.

15 Q. Okay. Has SDIBI ever used Gu Ai Hua, spelled for

16 the court reporter, G-U, then middle name is A-I, and then

17 last name is H-U-A. So, Mr. Bollen, had SDIBI ever used Gu

18 Ai Hua to perform marketing and recruitment of EB-5 projects

19 in China?

20 A. No.

21 Q. Okay. Has SDIBI ever used the Dragon Horse

22 Company to perform marketing and recruitment in China?

23 A. No.

24 Q. Has SDIBI ever used -- well, sorry, going back to

25 Dragon Horse. Are there any written agreements between SDIBI

Page 49

1 and Dragon Horse?

2 A. No.

3 Q. Has SDIBI ever used L&L Trading Company to

4 perform marketing and recruiting of EB-5 projects?

5 A. Not L&L, though Frank Lin, I have seen his name

6 before, but not L&L.

7 Q. Okay. Has -- so SDIBI -- sorry, hold on a

8 second. Let me regroup here. Has SDIBI ever entered into an

9 agreement, a written agreement with Frank Lin?

10 A. Not that I recall.

11 Q. Okay. Has SDIBI, has it ever used Frank Lin

12 though for marketing and promotion of EB-5 projects?

13 A. We might have, but nothing ever materialized.

14 Q. Okay. And just so we're talking --

15 MR. SVEEN: You're talking SDIBI, right?

16 MR. OKADIGBO: Yeah.

17 Q. (BY MR. OKADIGBO) Just so that we're clear, and

18 I'll get into it later, I understand that SDRC Inc. executed

19 written agreements with persons or entities in China. Right

20 now I'm just asking about SDIBI, not SDRC Inc.

21 A. And the answer is no.

22 Q. Okay. So just to clarify, no written agreements

23 ever between SDIBI and L&L Trading?

24 A. Correct.

25 Q. And no written agreements between SDIBI and Frank

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Page 50

1 Lin?

2 A. Correct. SDIBI did not enter into any

3 agreements.

4 Q. Okay. So it's fair to say SDIBI did not enter

5 into any written agreements with any of these entities listed

6 on page 1253, is that correct?

7 A. Correct.

8 Q. And just to spell it out for the record for ease

9 of reading the deposition transcripts, Mr. Bollen is saying

10 that SDIBI did not have any written agreements with Shanghai

11 Qianjin Exit-Entry Affair Service. For the court reporter's

12 benefit Qianjin is spelled Q-I-A-N-J-I-N. Shanghai Qianjin

13 Exit-Entry Affair Service.

14 Mr. Bollen is also stating that SDIBI never had

15 any written agreements with Shanghai Jinghong, which is

16 J-I-N-G-H-O-N-G, Exit-Entry Service Company, Limited; that

17 SDIBI never had any written agreements with Shanghai Beili,

18 which is B-E-I-L-I, Communication & Technology Engineering

19 Company, Limited; and that the same is true of L&L Trading,

20 Dragon Horse Company, and PRC Historical Education (Holdings)

21 Company, Limited. Okay, so am I correct in what I've just

22 stated?

23 A. Yes.

24 Q. Okay. And even though SDIBI did not have written

25 agreements with any of the entities we've just discussed, did

Page 51

1 SDIBI ever use any of the individuals listed here to perform

2 marketing and recruitment of EB-5 opportunities in China?

3 A. Well, SDIBI did not enter in any agreements as

4 you said before, so from that perspective, there's nothing

5 for SDIBI to use.

6 Q. Okay. At some point, the relationship between7 Hanul and Darley broke down, is that correct?

8 A. Correct.

9 Q. And you were involved in dealing with,

10 presumably, the back and forth between Hanul and Darley, is

11 that correct?

12 A. Like a marriage counselor, correct.

13 Q. Can you tell us what your understanding of how

14 the breakdown in relations occurred?

15 A. I think it was twofold. I think that Hanul felt

16 that during the meeting in China they were somewhat conned

17 into an agreement with Stratmore because Stratmore didn't

18 have any infrastructure in place in China.19 Q. Okay. So you stated that Hanul had issues with

20 Darley in terms of Darley not having, at least according to

21 Hanul, an infrastructure in China, is that correct?

22 A. Correct.

23 Q. Okay. And how -- when was that first brought to

24 your attention that Hanul had this impression of Darley's

25 infrastructure in China?

Page 52

1 A. From what I recall, approximately a month

2 before -- somewhere around November, a month before the

3 seminars.

4 Q. Okay.

5 A. There were some ill feelings. Shortly after the

6 contract was signed with Hanul.

7 Q. Okay. I'm going to show you an e-mail that --

8 this one is under the Hanul Bates numbers, so it's Hanul0479

9 and Hanul480. They're on pages ten and eleven of documents

10 part two pdf that I sent to both of you, speaking with

11 counsel, this morning. So we'll mark this as Exhibit 4.

12 MR. CHA: What were the Bate numbers again?

13 MR. OKADIGBO: Hanul0479 and Hanul0480.

14 MR. CHA: Okay.

15 MR. OKADIGBO: Somebody else joining or leaving?

16 Hello?

17 MS. ELKAYAM: No, Jennifer Elkayam is still here.

18 MR. OKADIGBO: Okay.


20 Q. (BY MR. OKADIGBO) We're passing Exhibit 4 to the

21 witness, which again is Bates label Hanul4079 and Hanul0480.

22 For identification purposes, it's an e-mail from James Park

23 to Joop Bollen dated November 15, 2007. Could you please

24 take a look at that e-mail and let me know when you're done?

25 A. (Witness reviewing exhibit.) Okay.

Page 53

1 Q. Well, let me ask this. Do you recall receiving

2 this e-mail from Mr. Park?

3 A. I -- again, now that I read it, yes.

4 Q. Okay. Would you -- before my showing this to

5 you, you had already discussed -- you had already

6 discussed -- you had already stated that the breakdown in

7 relations between Hanul and Darley, that one aspect of it was

8 Hanul's assessment that Darley did not have an effective team

9 in place in China, correct?

10 A. Correct.

11 Q. Does this e-mail either refresh your

12 recollection, or does it fit into --

13 A. It fits into the thinking that --

14 Q. Into what you've just described?

15 A. Yes, yes.

16 Q. Okay. Do you recall also having -- do you recall

17 what -- did you have, besides this e-mail, did you have any

18 conversations with Mr. Park on this issue of Darley's --

19 A. Yes.

20 Q. -- capabilities in China?

21 A. Yes.

22 Q. Okay. Can you tell us when you had those

23 conversations?

24 A. Probably around the same time frame, but my

25 attitude was that's your problem, I'm not married to Hanul,

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Page 54

1 I'm not married to Darley, if you guys don't do what's fine

2 for South Dakota, I'll find a different way anyway.

3 Q. Okay.

4 A. That was my mind frame.

5 Q. Okay. So after Mr. Parks sent you this e-mail,

6 what, if anything, did you tell Mr. Park?

7 A. Again, I didn't think this was my business so

8 much. The only thing I was concerned about is there's

9 opportunities out there and I'm going to find a way to make

10 sure that those opportunities will materialize for the State

11 of South Dakota, whether that's with Hanul, without Hanul,

12 with Darley or without Darley, I'll find somebody to

13 materialize those opportunities for us.

14 Q. Okay. Can you describe, if you recall, what

15 Darley's issues were as you remember it? So in other words,

16 you've told us about Hanul's issue with Darley about its

17 recruiting capabilities in China.

18 A. Um-huh.

19 Q. Do you recall what Darley expressed that its

20 issues with Hanul was, if anything, at that time?

21 A. Well, what I remember is that James Park's mom

22 was dying of cancer during that time frame, and Stratmore was

23 just pushing for materials irrelevant of James' personal

24 situation, so that is something I recall. He was asking for

25 materials from Hanul.

Page 55

1 Q. Okay. And would the materials have been for the

2 tilapia project?

3 A. Correct.

4 Q. Okay. And was Mr. Stratmore, for lack of a

5 better way to put it, complaining to you about the fact that

6 Mr. Park in his mind was not sending the materials?

7 A. Yes, he did complain about that.

8 Q. Okay. But this -- okay, so from what I

9 understand, it was November 15th, 2007 that Mr. Park

10 expressed to you in this e-mail his doubts about Darley's

11 recruiting capabilities or his team in China, correct?

12 A. Correct.

13 Q. Okay. But you stated earlier that seminars were

14 still -- seminars were held in December, correct?

15 A. Correct.

16 Q. Do you -- I mean, I guess I'll ask Mr. Park

17 during his deposition, but do you have any personal knowledge

18 of, in terms of maybe Mr. Park talking to you, about why

19 Hanul or Mr. Park went ahead with using Darley at the seminar

20 in China a month later even though he had e-mailed you these

21 doubts about Darley's recruiting team in China?

22 A. Should you not ask James that, that question?

23 Q. Okay.

24 A. It seems to me that it's more properly directed

25 for him.

Page 56

1 Q. Yeah.

2 A. As opposed to me to guess what he was thinking.

3 Q. Well, as I said, I will definitely ask him that,

4 but I was just wondering whether you recall him, him being

5 Mr. Park, sharing any of his thoughts on that with you, and

6 if you do remember, great, if you don't, then --

7 A. I don't recall it.

8 Q. Okay. And then at some point from e-mails that

9 I've seen, it looked like Mr. Park had come to a decision, or

10 I guess he engaged Darley in discussions about getting Darley

11 out of the picture in terms of marketing and recruiting, do

12 you recall that?

13 A. Yes.

14 Q. Okay. It's probably a bit repetitive for you,

15 but we do have a process. What was your involvement or role

16 in deciding whether Darley would continue to have this

17 opportunity that Park was giving him or that Hanul was giving

18 him to recruit or not?

19 A. Well, my -- from my perspective, I wanted

20 productivity for the State of South Dakota, so when it was

21 obvious this relationship was not going, I asked for Mr.

22 Stratmore, can we not work together on a different area and

23 let Hanul do one area, you do another geographical area so

24 that we have two productive engines humming at the same time

25 for the State of South Dakota?

Page 57

1 Q. Okay. And when did you have that conversation

2 with Mr. Stratmore?

3 A. Probably late December or very early January

4 2008, late December 2007 or very early on 2008.

5 Q. So if I'm hearing you correctly, you offered Mr.

6 Stratmore, you stated to him that you were willing to have7 him work in different areas?

8 A. Different geographical areas.

9 Q. Okay.

10 A. He mentioned that he had a fast network in the

11 former Soviet Union and he had contacts in the Middle East

12 and he had contacts in South America.

13 Q. Right.

14 A. So as opposed to these two parties fighting while

15 the fruit is fresh on the tree, --

16 Q. Right.

17 A. -- I said can we do something where Hanul does

18 their thing and you do their thing, that's for us the best19 because that way we get double the productivity.

20 Q. And what was Mr. Stratmore's response?

21 A. I think his response was not negative, but his

22 actions speak louder afterwards.

23 Q. Okay. What do you mean by his actions speak

24 louder?

25 A. Well, he brought a case. So effectively, you

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Page 58

1 would say no, I guess, but he didn't tell me that --

2 Q. Right.

3 A. -- during the conversations.

4 Q. Okay. I'm going to show the witness what is

5 marked as Darley's exhibit, so DI001290 and 001291, and that

6 is in the documents part two pdf that I sent to counsel

7 earlier this morning. It's on pages 24 and 25 of that pdf.

8 We'll mark it as Exhibit 5.


10 Q. (BY MR. OKADIGBO) Can you take a look at the

11 second e-mail, so not the one that says, "Dear Cindy, thanks

12 for your reply," but the one after that.


14 Q. Okay. Now these e-mails were not sent to you, so

15 I'm not --

16 A. Right.

17 Q. I'm not giving them to you for that purpose.

18 A. Right.

19 Q. You probably haven't even seen it before today,

20 but I wanted to ask you about the subject matter in it, which

21 is, it appears that somebody by the name of Cindy, if I was

22 to make a leap of -- a leap of reasoning, I would say Cindy

23 Shi perhaps is communicating with, I believe, Mr. Stratmore

24 and telling Mr. Stratmore that she wants to work directly in

25 terms of marketing EB-5 projects for China. She wants a

Page 59

1 direct relationship with Joop, you. So my question is, did

2 you have any conversations, as far as you can remember, with

3 Cindy Shi about entering into some sort of marketing

4 relationship with Cindy Shi?

5 A. Not with Cindy Shi.

6 Q. Okay.

7 A. The Cindy Shi I know wouldn't display this

8 perfect English either.

9 Q. Okay. Did you talk to Cindy Shi about any kind

10 of marketing relationship?

11 A. I -- you know, Cindy, the Cindy I know would not

12 be the proper person to talk to these kind of issues about.

13 Q. Okay.

14 A. She's more of an operational lady.

15 Q. Okay. So I take it the response would be no,

16 you --

17 A. No, that's correct.

18 Q. -- didn't talk to Cindy Shi?

19 A. Not that I recall.

20 Q. Okay.

21 MS. ELKAYAM: I'm sorry, are you referring to the

22 Cindy in the e-mail that you're presently looking at?

23 MR. OKADIGBO: Yes.


25 MR. OKADIGBO: I'm -- I don't know, because I

Page 60

1 don't see a last name that it's Cindy Shi, but I was

2 wondering if it was and that's why I was asking Mr. Bollen

3 the question.

4 A. Yeah, the reason why I cannot say because the

5 e-mail, none of these e-mails look familiar to me, the e-mail

6 addresses.

7 Q. (BY MR. OKADIGBO) Okay.

8 A. They would not correspond to the Cindy I know.

9 Q. Okay. Going back briefly to a subject matter, or

10 subject matter area we've touched upon, did the board of

11 regents ever authorize you to enter into any written

12 agreements?

13 A. No.

14 Q. Did Northern State University ever authorize you

15 to enter into any written agreements?

16 A. Under SDIBI, no.

17 Q. While you were SDIBI director, what was your

18 understanding of what you needed to do if you wanted to get a

19 written agreement in place?

20 A. I wouldn't even go there because it doesn't work

21 in the system, so that is not something I would even attempt

22 to do.

23 Q. Okay. And just so that we understand, why

24 wouldn't you attempt it?

25 A. Because it's a bureaucratic -- my job was doing

Page 61

1 very entrepreneurial things in a very bureaucratic

2 environment, and a typical bureaucrat is not going to sign

3 off on the kind of activities that I was instructed to do, so

4 it would become bogged down in the system by people who would

5 rather not make any decision at all.

6 Q. Okay.

7 A. And therefore there would be too many time delays

8 before it would be practical, become practical.

9 Q. Okay.

10 A. It would be ineffective.

11 Q. Okay. When you were the director of SDIBI, can

12 you tell us who did you report to?

13 A. The dean of the business school.

14 Q. Okay. What was his name at the time?

15 A. Clyde Arnold.

16 Q. Is there anyone else --

17 MR. SVEEN: Just let him finish the question, try

18 to remember that.

19 Q. (BY MR. OKADIGBO) Besides Mr. Arnold, is there

20 anyone else you reported to?

21 A. For Northern Plains International, Incorporated

22 which was a separate entity set up by the school of business,

23 there would be a board of several NSU professors and faculty

24 members and staff members as well.

25 Q. Okay. But these are the only two, I guess Clyde

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Page 62

1 Arnold and --

2 A. Clyde Arnold for SDIBI, but then some of the

3 export related, more entrepreneurial projects, there was a

4 separate board set up for Northern Plains International,

5 Incorporated, and there I had to get the approval from the

6 entire board for different actions.

7 Q. Okay. Is Clyde Arnold still --

8 A. No, he's retired.

9 Q. -- dean of the business school?

10 A. Sorry. No, he's retired.

11 Q. Okay. Was he dean of the business school

12 throughout the time, the entire time that you were the

13 director of SDIBI?

14 A. No, the last -- I think the last year, 2008 he

15 might have retired. I'm not absolutely sure of that.

16 Q. Okay. So if he did retire in 2008, then you

17 would have reported to the next dean that replaced him?

18 A. Correct, correct.

19 Q. Okay.

20 A. There actually was a new dean. Now I recall.

21 Q. Okay. Do you remember the name of --

22 A. I do not know his name.

23 MR. SVEEN: Is it Meyer?

24 A. No.

25 Q. (BY MR. OKADIGBO) Okay.

Page 63

1 A. I do not recall his name.

2 Q. Okay. And just to be clear, when you say you

3 reported to Mr. Arnold, in terms of the EB-5 aspect of your

4 responsibilities as SDIBI director, did you report to Clyde

5 Arnold on that?

6 A. As well -- I reported to Clyde Arnold on that, as7 well as Northern Plains International, it was discussed there

8 as well. It was monthly reported to the governor's office

9 and Clyde was CC'ed on all those reports.

10 Q. Can you tell us -- you described briefly that you

11 also reported to the governor's office. Can you tell us

12 what, in terms of your SDIBI, wearing your SDIBI hat,

13 director of SDIBI, what your reporting to the governor's

14 office consisted of?

15 A. There existed a contract between the governor's

16 office and Northern State University for the university,

17 SDIBI, to do the international activities for the governor's

18 office -- or under contract with the governor's office.19 There was a financial flow of moneys that would go from the

20 governor's office to Northern State University. I was a

21 salaried employee of the university, but the intent of the

22 university was to make sure that GOED was happy, that we

23 provided the right results for the governor's office in hope

24 to get the contract renewed, renewed and renewed after --

25 year after year.

Page 64

1 Q. So what types of things would you report to the

2 governor's office in your monthly reports?

3 A. I would -- there would be several different

4 subsections under export. There would be discussions of

5 foreign direct investment, and one small component -- well,

6 one component of foreign direct investment became EB-5.

7 Early on it would be something different. But you had two

8 big categories; export promotion and foreign investment.

9 EB-5 was an component of foreign investment. We would report

10 whatever activities we did for these different subsections.

11 Q. Let me ask this. In any of your reporting to

12 Clyde Arnold, did you ever discuss Darley International or

13 Robert Stratmore --

14 A. No.

15 Q. -- with him?

16 A. No.

17 Q. Okay. Same question, but for GOED. Did you ever

18 discuss with the governor's office, did you ever report to

19 them any ongoings involving Darley International or Robert

20 Stratmore?

21 A. Maybe after the trouble became known, but before,

22 no.

23 Q. Okay. And when you say trouble, you mean the

24 filing of the lawsuit and --

25 A. Right.

Page 65

1 Q. -- the aftermath of that?

2 A. Right, right, the aftermath of it.

3 Q. Okay. Sorry to keep shifting around. Going back

4 to the Hanul-Darley breakdown in relations. You've told us

5 what you recall of the Hanul side of things, as well as the

6 Darley side of things. How did the breakdown ultimately end?

7 I mean, I guess you told us that you made this offer to

8 Robert Stratmore to do different regions, I guess. Is that

9 how it ended that --

10 A. In my recollection, that's the last conversation

11 is trying to find a way to have Robert Stratmore productive

12 for the State of South Dakota.

13 Q. Okay. Now after this breakdown in relations

14 between Hanul and Darley, did SDIBI use or continue to use

15 Hanul for marketing and promotional EB-5 efforts?

16 A. In Korea, yes. In the other parts of the world

17 they would just be the immigration attorney for cases that

18 were recruited.

19 Q. Okay. So let's discuss this. After the tilapia

20 debacle, so between the -- which was in December 2007. So

21 let's say this, between December 2007 -- actually let me back

22 up. Between October 18th, 2007 when the Darley-Hanul

23 contract came into existence and December of 2009, how many

24 EB-5 projects, if you can remember, came through the regional

25 center?

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Page 66

1 A. Not many at all.

2 Q. Okay.

3 A. I don't have an exact number.

4 Q. Okay.

5 A. But I remember the first case I think was

6 approved somewhere around March 2009.

7 Q. Okay.

8 A. That's what I recall at least.

9 Q. Okay. Do you recall any kind of order with the

10 projects, so obviously the first was the tilapia, but then

11 that was withdrawn. Do you remember what was immediately

12 after tilapia in terms of recruiting?

13 A. Well, there was a time of uncertainty. We didn't

14 know. You talk to different companies, but until you reached

15 an agreement, you have no assurances. We -- at that time a

16 beef project was being worked on, was actually -- the

17 marketing effort for a beef plant was pretty much over with

18 at that stage, and then there was a turkey project that was

19 in the pipeline, but early January 2009 nothing was

20 guaranteed, so we did not know whether we were going to land

21 a project or not.

22 Q. Okay. Just out of curiosity, what was the beef

23 project called, or was that NBP?

24 A. Correct.

25 Q. Northern Beef Packers, right?

Page 67

1 A. Correct.

2 Q. And you stated that that was pretty much done.

3 Was it pretty much filled at the same time as the tilapia --

4 A. No, no, no, no, that was the project, NBP was

5 promoted by Hanul largely focussed on Korea. They were

6 just -- they did the marketing campaign as far as I can7 recall and they were just picking the last fruits off the

8 tree.

9 Q. Okay.

10 A. And getting that project filled up, but all the

11 promotional aspect was completed by Hanul.

12 Q. Okay. Do you recall roughly when that was, was

13 it December of 2007 or --

14 A. December 2007 is when the last cases started to

Documents

Bollen Deposition