Ho-Chunk Inc., the economic development arm of the Winnebago Tribe of Nebraska, recently filed a .3 million lawsuit against Omaha-based Northstar Campaign Systems. Ho-Chunk claims it paid more than .29 million to Northstar to collect enough qualified signatures to place on the November ballot a proposal to allow casino gambling in Nebraska. However, Ho-Chunk said Northstar failed in that task.
Last summer casino petition organizers, the organization Keep the Money in Nebraska, submitted 119,666 signatures for the proposed constitutional amendment to Nebraska Secretary of State John Gale’s office, but more than 41,000 were rejected as duplicates or because petition signers were not registered to vote in the state or the county listed. Gale called the 35 percent invalid-signatures rate “quite stunning.” Ho-Chunk also has questioned whether paying petition circulators per signature encouraged some to request duplicate or questionable signatures.
Ho-Chunk, which operates a casino near Sloan, Iowa, had arranged to operate casinos at racetracks in Omaha, Lincoln and other locations if the measure passed. Ho-Chunk said it hired Northstar to run the petition campaign because Northstar had conducted a poll suggesting 57 percent of likely Nebraska voters “would either vote for, or lean towards voting for, expanded gambling.”
In its lawsuit, Ho-Chunk said Northstar inflated the number of signatures gathered and the progress of the campaign. “But for Northstar’s false overstatements to Ho-Chunk of the number of signatures gathered and the validation rate of said signatures, Ho-Chunk would have terminated the service agreement and would not have continued to make payments to Northstar,” Ho-Chunk attorney Conly Schulte wrote in the lawsuit. The lawsuit says Northstar should have to repay Ho-Chunk “out of fairness and justice.”
Northstar attorney Scott Lautenbaugh said, “We think we’ll be vindicated.” He said the company, which has organized several other successful campaigns, never guaranteed the results of the petition drive. Lautenbaugh the petition effort failed for other reasons; for example, the proposal’s language wasn’t finalized until October 15, 2015, so the campaign missed the state fair and most of the University of Nebraska’s home football games. Lautenbaugh added the proposal required people to sign three different forms, to support expanding gambling, set up a regulatory commission and tax gambling in the state, which made the signature-gathering process more complex.
Lautenbaugh also disputed the lawsuit’s allegations that “a Northstar representative deliberately discarded or mishandled thousands of original and duplicate petition signatures, and failed to deliver all of the original and duplicate petition signatures to Ho-Chunk and-or the Nebraska secretary of state.” Ho-Chunk alleged that copies of petitions were found in a dumpster in downtown Omaha. Lautenbaugh said all of the papers found in the dumpster were yellow copies, meaning they were reprinted on yellow paper to distinguish them from the original white petitions. He added Northstar has no knowledge of how the copies got in the dumpster, which is in the private parking garage of a condominium community where no Northstar employees live. Furthermore, Lautenbaugh noted, the trashed dumped petitions were discovered in late September, two months after Northstar had turned in the petitions to the state and the copies to Ho-Chunk.
In a statement, Ho-Chunk said, “The proposed gambling initiative would have been a boon for our local economy and local residents due to the increased tax revenue. Our efforts to promote our gambling initiative and generate revenue for Nebraska were unduly harmed by Northstar.”
