Ex-North Dakota Workers’ Comp Director Files Federal Appeal

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A former North Dakota workers’ compensation director has asked a federal judge to review his felony conviction for misspending state funds, claiming county prosecutors used false testimony to get it.

In a petition filed in U.S. District Court in Bismarck, Sandy Blunt asked to be excused from completing his sentence. A state district judge has ordered Blunt to perform 1,000 hours of community service for his December 2008 conviction.

Blunt was accused of spending about $26,000 on meals, movie tickets, gift cards and trinkets for employees of North Dakota’s Workforce Safety and Insurance agency and on benefits for an agency executive, David Spencer.

Spencer testified at Blunt’s trial that he had collected more than $7,000 in sick leave pay, even though he was healthy, and that he didn’t pay back $7,600 in moving expenses, despite having worked at the agency for less than two years.

Mike Hoffman, Blunt’s attorney, said prosecutors questioned state auditor Jason Wahl at Blunt’s trial as if Spencer still owed the money.

However, Wahl had concluded Spencer was forced to quit and thus did not have to repay his moving expenses, Hoffman wrote in a court filing. Spencer left Workforce Safety and Insurance in September 2006.

In his federal court petition, Hoffman wrote that the prosecutors’ conduct violated Blunt’s right to due process of law because they “knowingly used perjured testimony.”

“Why did (prosecutors), through Wahl as its witness, prosecute Blunt for an issue which Wahl, and the attorney general’s office, had ultimately decided in Blunt’s favor?” Hoffman wrote.

Prosecutors also neglected to give Hoffman a memo, written by Wahl, that concluded Spencer’s departure was involuntary, the defense attorney said. The memo would have bolstered Blunt’s argument that Spencer did not owe the $7,600 in moving expenses and that Blunt did not commit a crime by refusing to collect the money, Hoffman said.

Richard Riha, the Burleigh County state’s attorney, and the two assistant prosecutors who handled Blunt’s case, Cynthia Feland and Lloyd Suhr, could not be reached for comment. They do not have listed telephone numbers, and they did not respond to email messages.

No responses have been filed to Blunt’s federal court petition, which was filed Feb. 17.

Feland is now a state district judge. The North Dakota Supreme Court is considering whether she should be disciplined for her handling of the Blunt case. A disciplinary panel has recommended she be suspended from practicing law for two months and ordered to pay more than $11,000 in investigation costs.

The Supreme Court has twice declined to reopen Blunt’s case. The court affirmed his original felony conviction and later refused to order a new trial based on Feland’s alleged nondisclosure of the Wahl memo.

Feland claimed Blunt already had the information included in Wahl’s memo and that she had hoped Hoffman would use it at Blunt’s trial, so that she could provide evidence of Blunt’s hostility and evasiveness with state auditors.

Blunt was director of Workforce Safety and Insurance from April 2004 until he was forced out in December 2007. A state audit the previous year had questioned the agency’s spending and management.

WSI provides workers’ compensation insurance to businesses, which they are required to buy. It provides benefits if an employee is injured on the job.