Government wants tractors back from Minnesota organic farmer accused of fraud

The legal fate of a southwestern Minnesota organic grain farmer accused of fraud has been stuck in neutral for months as the federal government and the farmer's attorney haggle over a number of procedural questions, including where to temporarily store the man's tractors.

In the courtroom of federal Magistrate Judge David Schultz on Tuesday, the attorney for James Clayton Wolf, of Jeffers, Minn., pleaded with the court to allow Wolf to keep his "million-dollar tractors" and other equipment stored in sheds on his property, even though they are, technically, under seizure by the government.

"Can we just leave [the tractors] in his barn?" attorney Paul Engh asked Schultz during a 45-minute-long motions hearing in the U.S. District Court of Minnesota in Minneapolis. Engh said the facility was "locked and snowed-in."

Wolf, a Cottonwood County farmer, has been accused by federal authorities of three counts of wire fraud for allegedly selling non-GMO grain as organic between 2014 and 2020. The government says Wolf enriched himself by $46 million on the scheme and should forfeit property purchased with those funds, including multiple tractors, semi-trailer trucks, farm equipment and two corvettes.

In August, U.S. Magistrate Judge Becky Thorson recommended the return of a half-dozen farm implements for Wolf to complete the harvest of non-organic crops to maintain his livelihood.

On Tuesday, Wolf's attorney called that decision "Solomonic," but he noted, "They [the government] get to take his equipment without a conviction."

Attorneys with the U.S. Department of Justice maintain that U.S. Marshals be allowed to again remove the tractors from the farmer's land.

Engh disputed this claim, saying Wolf had lost credit in southern Minnesota given his legal trouble.

At one point during the proceedings, Baune referred to the government re-seizing the tractors, but Schultz interrupted him.

"They're still seized," the magistrate said.

The fraud case catapulted to the public eye when a grand jury last July indicted Wolf for selling mischaracterized grain — including some he'd farmed and some he'd bought — to buyers as far away as Pennsylvania. In both instances, say prosecutors, Wolf misrepresented his non-GMO grain as organic.

Organic grain has long been regulated by standards set by USDA's National Organic Program. Organic food is farmed, generally, with limited to no reliance on synthetic fertilizers or genetic engineering, and consumers often perceive organic food as more nutritious than food made from traditionally raised crops.

In addition to the fight over the custody of the tractors, Wolf's defense team has requested more information from an organic rating agency — the Organic Crop Improvement Association — to demonstrate Wolf had maintained an organic farm for two decades.

"That is one piece of the case that is missing for us," said Engh. He said his client had spent a "lifetime of growing organic crops."

On Tuesday, attorneys for the government said the OCIA, while contracted by the USDA to evaluate organic fields, is not technically a governmental entity and therefore they are unable to produce the underlying data behind the evaluations.

On May 13, nearly two months before a grand jury indicted Wolf, the government use a pre-indictment warrant to seize and remove Wolf's property — including his John Deere tractors and combine — from his property. Shortly later, the government returned a tractor and another implement for Wolf, who is presumed innocent, to plant his summer crop. This fall, the court returned a second semi-trailer truck.

Engh said the equipment is safest on the farm. The defense team also alleges the equipment sustained rust while under the U.S. Marshals' custody and could further be damaged being stored or moved in the extreme cold.

"Not to mention unwise," Schultz said.