Nevada Live Stock Association

(Sparks, NV) An Esmeralda County, Nevada, Special Grand Jury, empanelled to investigate actions by Nevada’s head brand inspector, Jim Connelley, issued its final report on June 16^th,2005. The Grand Jury issued a strong and detailed report highly critical of the Nevada Department of Agriculture and Attorney General’s office for their handling of the matter and recommended immediate policy changes needed to bring Nevada’s Department of Agriculture (DOA) and Attorney General’s Office into compliance with the 5^th and 14^th Amendments’ (U.S. Constitution) procedural due process requirements and with Nevada Brand Law.

“This is exactly the result we were looking for,” commented Ben Colvin. “All I ever wanted was justice and protection for my property, which I was never given. My sheriff conveniently went missing once he knew the BLM was coming with their guns to steal my cattle. The AG’s office gave Connelley advice that was akin to permitting the BLM to rob a bank, and Mr. Connelley followed that advice. They stole my cattle and destroyed my livelihood. I appreciate the support of the citizens of Esmeralda County in this effort, and the excellent work of the Grand Jury for making these recommendations to the State,” said Colvin.

The Nevada Live Stock Association (NLSA) originated the idea of using the Special Grand Jury and participated in gathering the necessary signatures.

NLSA Chairman, Helen Chenoweth-Hage commented on the Grand Jury Report, “We are very, very pleased with the recommendations of the Grand Jury. This is the third time the Nevada Department of Agriculture and Attorney General’s office have been directed to enforce procedural due process and the brand laws of Nevada. Many of Nevada’s ranchers have suffered from the devastating impact of having their cattle rustled by the federal government. Now, after this decision, there is no doubt that the sheriffs’ must do their job and protect property from unlawful government actions and not place the individual rancher’s livelihood at risk. There has to be due process afforded.”

The Grand Jury report stated, “The grand jury believes that the primary mission of the Nevada Department of Agriculture is and should be the protection of Nevada’s livestock industry from unauthorized possession or movement of cattle, whether by theft or other means. This should be accomplished by vigorous enforcement of the brand inspection laws. In addition, the Division needs to strongly protect the “lock and key” theory behind livestock brands.”

The DOA had allowed the BLM to sign as the owner of record on Mr. Colvin’s cattle brand inspection certificates. The Grand Jury report did not agree, ruling that, “The grand jury believes that allowing an employee of a federal agency to sign a brand inspection clearance certificate on the line reserved for the “Signature of the Owner or Authorized Agent” is improper and that, to better serve the livestock industry and the general public, such a practice should be discontinued.”

David Holmgren commented that, “I am especially glad that the Grand Jury recognized that the DOA’s Memorandum of Understanding with the BLM is dead wrong. It must go. I want to see if the Mr. Henderson (Director of the Nevada Department of Agriculture) will finally get his irons out of the fire and brand this MOU as the piece of treason it is. The Grand Jury has spoken and it was very plain to understand.” Mr. Holmgren is a rancher from Mineral County and Vice Chairman of the Nevada Live Stock Association.

“The point was to protect our livestock from being illegally forced from our Nevada ranges. Our association is pro-cattle and pro-ranchers. We are in the livestock business and we mean business. It turned out great. The AG and DOA got branded.” Said Holmgren.

As background to the Grand Jury’s report, in 2004 Judge Janet Berry of the Second Judicial District Court of Washoe County took judicial notice of the fact that the procedures for issuing brand inspection clearance certificates in the instances of livestock seizures did not afford due process of law. The Nevada Live Stock Association was the only group who legally countered the DOA’s Petition and the DOA’s actions. Judge Berry dismissed the DOA’s Petition as unconstitutional under Nevada law.

During the recent Legislative session, Assemblyman John Carpenter, (R-Elko) brought A.B. 407 to address livestock impoundments legislatively. The Nevada Live Stock Association testified before the Assembly Natural Resources Committee and was instrumental in helping to amend the original bill draft to reflect due process, as it exists in long standing brand law. It passed both houses earlier this year and was signed into law by the Governor.

A grand jury may indict, make a report with recommendations, or do nothing. The original petition against Connelley was for issuing brand inspection clearance certificates to the Bureau of Land Management (BLM) for livestock raids that removed, and eventually sold, cattle owned by Esmeralda County rancher, Ben Colvin. Mr. Colvin is the owner of the 40 Bar Ranch, in Goldfield, Nevada. The Special Grand Jury declined to directly indict Connelley because his actions “…were based on advice to (him) from the Nevada Attorney General’s Office…and were performed without any criminal intent.” This leaves open the question of the Attorney General’s liability for endorsing BLM’s cattle seizures without enforcing due process of law.

As allowed by law, the Grand Jury has made six recommendations to the state for immediate action:

“1. That the Nevada Department of Agriculture require an appropriate judicial order be entered prior to the issuance of a brand inspection clearance certificate to a party who is not the legal owner of the livestock in question.

2. That the Nevada Department of Agriculture terminate the April 6, 1999 Cooperative Agreement with the Bureau of Land Management.

3. That, in the event the Nevada Department of Agriculture enters into another similar Cooperative Agreement with any federal agency, such agreement should contain a requirement that an appropriate judicial order be entered prior to the issuance of a brand inspection clearance certificate to that agency.

4. That due process, as applied to the involuntary impound and/or sale of livestock in Nevada, should mean both notice and an opportunity to be heard in a judicial proceeding. In the case of federal impounds and/or sales of livestock, such a judicial proceeding should be outside of the federal agency and held before an independent state administrative law judge or state or federal district court.

5. That, at least 2 weeks prior to an impound and/or sale of livestock, written notice of the exact date(s) and location(s) of the proposed impound and/or sale should be personally served on the Nevada Department of Agriculture, on the legal owner of the affected livestock and on anyone holding a UCC Financing Statement and/or claiming a lien on the affected livestock.

6. That the Nevada Attorney General issue a formal published Attorney General’s Opinion describing the exact steps that the Nevada Department of Agriculture requires to be followed prior to the issuance of a brand inspection clearance certificate to a federal agency and circulate said Opinion generally throughout the livestock industry.”

COMES NOW, the Esmeralda County Special Grand Jury, and pursuant to Nevada Revised Statute 172.267, makes the following Special Grand Jury Report:

On August 26, 2003 an Affidavit Of Five Registered Voters To Summon A Grand Jury was filed with the office of the Esmeralda County Clerk pursuant to Nevada Revised Statute (hereinafter “NRS”) 6.132. Thereafter, on November 3, 2003 a Verified Petition Of Registered Voters Of Esmeralda County For The Summoning Of A Grand Jury (hereinafter “Petition”) was filed with the said Clerk.

Both Fifth Judicial District Judges recused themselves from this matter, as did the Esmeralda County District Attorney. The Honorable Archie E. Blake, Third Judicial District Judge, was appointed to impanel the grand jury and oversee the grand jury proceedings. Hy Forgeron, Esq., Lander County District Attorney, was appointed as a special Deputy District Attorney to advise the grand jury and conduct the grand jury proceedings.

On May 18, 2004, Judge Blake formally impaneled the Special Esmeralda County Grand Jury (hereinafter “grand jury”).

The grand jury was formed to investigate the allegations set forth in the Petition. Said allegations, which are a matter of public record, are:

“On or about July 26, 2001, Mr. James Connelley, Nevada State Inspector, and agents and employees, acting at his direction and on his behalf, knowingly and actively participated in the unlawful confiscation of the personal property, to-wit: cattle, of Mr. Ben Colvin of Goldfield, Nevada. As a result of this confiscation and subsequent sale, Mr. Colvin suffered significant financial loss. During his participation in the unlawful seizure of cattle, Mr. Connelley violated seventeen (17) separate laws of the State of Nevada in directing that agents from his office sign confiscation reports as agents for the lawful owner, Mr. Colvin, without a court order or without the knowledge and consent of Mr. Colvin. Said Mr. Connelley and agents and employees acting at his direction further violated Nevada laws when he failed to notify Mr. Colvin that his cattle were in the unlawful possession of another party or parties, and when he permitted said livestock to be transferred to an area outside of the brand district without the authority of Mr. Colvin. We further allege that, in addition to the foregoing reasons which necessitate the summoning of a grand jury, a grand jury should be summoned to determine whether or not there are sufficient grounds to exercise its authority pursuant to NRS 172.175 in determining whether or not an accusation should issue against Mr. Connelley for misconduct in office within Esmeralda County for failure to prevent the sale of Mr. Colvin’s cattle at a depressed price and for his failure and/or refusal to comply with the statutory obligations of his office.”

Having been impaneled and charged by Judge Blake, the grand jury proceeded to hear witnesses and examine evidence relating to the allegations in the Petition. NRS 172.245 prevents the disclosure of evidence produced before the grand jury and none will be disclosed here. However, based on the testimony and evidence produced, and without disclosing said evidence, the grand jury makes the following findings:[1]

1. The livestock owner (hereinafter “stock owner”) referred to herein is a resident of Esmeralda County, Nevada, engaged in the livestock industry, and is the owner of a livestock brand duly registered in the State of Nevada.

2. On July 26, 2001, agents of the federal Bureau of Land Management (hereinafter “BLM”) conducted a round up and impound (hereinafter “impound”) of 62 head of cattle. All but one of the cattle bore the stock owner’s brand. The unbranded animal was a bull calf belonging to one of the branded cows.

3. Prior to the impound, the BLM had given the stock owner notice of their intent to impound and sell the cattle, but not notice of the exact day on which it would be done. The reason given by BLM for the impound was the stock owner’s failure to pay grazing fees.

5. At the time of the impound, James Connelley (hereinafter “Connelley”) was and is now the head of the Brand Inspection Division of the Nevada Department of Agriculture (hereinafter “DOA”).

“. . . Applying this statute (NRS 565.100) to livestock impounded from the public lands located in Nevada, the Department has a firm policy not to issue a brand inspection certificate to the BLM (or any federal agency) unless it is first authorized by court order from an appropriate jurisdiction. . . .” (hereinafter “firm Policy statement”).

7. The DOA should have known that the firm policy statement set forth above would be disseminated to the Nevada livestock industry in general.

8. The DOA should have known that the requirement of a court order as set forth in the policy statement would be interpreted by the Nevada livestock industry as the DOA’s existing “firm policy”.

9. At that time, certain members of the DOA believed that the quoted “firm policy” set forth above was, and still is the right approach as to what the DOA’s position was and should be.

10. The BLM did not apply for, nor did it receive, any court order authorizing the impound or the eventual sale of the stock owner’s cattle.

11. Between the time of the “firm policy” statement and the time of the impound, DOA personnel consulted with the Nevada Attorney General’s Office (hereinafter “AG’s Office”) as to the procedure to be followed upon receiving a request from BLM for the issuance of a brand inspection clearance certificate (hereinafter “certificate”) following an impound.

12. After the “firm policy” statement and prior to the impound, the AG’s Office advised the DOA personnel that the BLM had provided sufficient documentation of notices to the stock owner that the BLM would be considered by the State to be in lawful possession of the cattle and that the DOA was required to issue a certificate to the BLM without a court order, which advice was later confirmed by letter to the DOA dated August 3, 2001 (hereinafter “letter”).

13. The conflicting opinions and policies expressed by the DOA and the AG’s Office created confusion and concern in the Nevada livestock industry.

14. Nevada law (NRS 565.090) requires a person moving livestock from one brand district to another to first obtain a certificate from a brand inspector.

15. The DOA entered into a Cooperative Agreement (also referred to as a Memorandum of Understanding) with the BLM dated April 6, 1999 (hereinafter MOU) which provided the procedure for the issuance of a certificate to BLM by DOA at an impound. The Nevada/BLM MOU does not require a court order. The MOU contains a provision that it may be terminated by mutual consent or by either party on thirty days written notice.

16. At the time of the impound, acting on the AG’s Office advice, a DOA brand inspector issued transportation certificates on the stock owner’s cattle to the BLM

17. The certificates, which are normally signed by the owner of the livestock on which they are issued, were instead signed by a BLM employee, who signed on the line labeled “Signature of Owner or Authorized Agent”. The stock owner’s name was printed on the certificates as the “Legal Owner of Livestock”.

18. Neither the stock owner, nor anyone acting on his behalf, gave BLM permission to sign the transportation certificates.

19. After obtaining the certificates, BLM transported the cattle from Esmeralda County to Churchill County, crossing into another brand district.

20. Although BLM attempted to sell the cattle in Fallon, they were unsuccessful in doing so. Thereafter, BLM moved the cattle to Washoe County. Since Churchill and Washoe Counties are in the same brand district, no new certificates were applied for by BLM nor issued by the DOA at that time.

21. On November 15, 2001, BLM sold the cattle to a California livestock operator. At the time of the sale, a DOA brand inspector issued a change of ownership certificate covering the sale of all 62 animals. The stock owner’s name was printed on the certificate as the “Legal Owner of Livestock” and a BLM employee signed on the line labeled “Signature of Owner or Authorized Agent”.

22. Neither the stock owner, nor anyone acting on his behalf, gave BLM permission to sign the transportation certificates.

23. That the actions of DOA personnel relating to the issuance of certificates to the BLM were based on advice to them from the Nevada Attorney General’s Office, were done in good faith reliance on said advice, and were performed without any criminal intent.

“The conduct of legal proceedings according to established rules and principles for the protection and enforcement of private rights, including notice and the right to a fair hearing before a tribunal with the power to decide the case.”

“The minimal requirements of notice and a hearing guaranteed by the Due Process Clauses of the 5^th and 14^th Amendments, esp. if the deprivation of a significant life, liberty or property interest may occur.”

The grand jury believes that the process followed by the BLM and the DOA in the matter of the impound and sale of the impounded cattle did not give the stock owner full and fair due process of law.

The grand jury believes that the primary mission of the Brand Division of the Nevada Department of Agriculture is and should be the protection of the Nevada livestock industry from unauthorized possession or movement of cattle, whether by theft or other means. This should be accomplished by vigorous enforcement of the brand inspection laws. In addition, the Division needs to strongly protect the “lock and key” theory[2] behind livestock brands.

The grand jury believes that allowing an employee of a federal agency to sign a brand inspection clearance certificate on the line reserved for the “Signature of Owner or Authorized Agent” is improper and that, to better serve the livestock industry and the general public, such a practice should be discontinued.

The grand jury is aware that several other states require some type of legal proceeding before livestock sought to be impounded by a federal agency can be impounded and/or sold without the consent of the legal owner. Such a process does not appear to impose an undue burden on either the government agency or the court system.

1. That the Nevada Department of Agriculture require an appropriate judicial order be entered prior to the issuance of a brand inspection clearance certificate to a party who is not the legal owner of the livestock in question.

2. That the Nevada Department of Agriculture terminate the April 6, 1999 Cooperative Agreement with the Bureau of Land Management.

The foregoing Recommendations are included in this Report pursuant to Nevada Revised Statute 172.269. Any criticism in this Report or in these Recommendations, express or implied, is and is intended to be constructive and is made solely in support of these Recommendations.

Further pursuant to Nevada Revised Statute 172.269, the grand jury concludes that it found no indictable criminal activity by DOA personnel.

Respectfully submitted to the Honorable Archie E. Blake, District Judge presiding, this 16th day of June, 2005.

[1] All documents referred to herein are matters of public record outside the grand jury proceedings.

[2] The “lock and key” theory may be simply explained as follows: Once a registered brand has been placed on livestock, it constitutes a “lock”. Only the owner of that brand has the “key” to that lock. Anyone, other than the brand owner, in possession of that livestock, must have the brand owner’s consent or a valid court order to the contrary.