Eagle Creek lawsuit will not affect USD partnership
A pending lawsuit between Vermillion’s Area Chamber of Commerce and Economic Development Company and Eagle Creek Software Services Inc. will not affect an academic partnership between the University of South Dakota and the Twin Cities-based technology company.
Jim Moran, provost and vice president of Academic Affairs, said an Information Technology Consultant Academy is still expected to open this summer for students, which incorporates four undergraduate courses, an internship, the possibility of employment and the opportunity to pursue a Masters in Business Administration – all designed to meet the workforce needs of Eagle Creek.
Introductory courses for the program are slated to begin at the start of the spring semester.
“Our relationship with Eagle Creek still exists,” he said. “We’re so looking forward to them working with us to potentially hire more of our students.”
The Chamber of Commerce is suing Eagle Creek because they say the technology company did not move into a $4.2 million technology center located across from Walmart the organization constructed for them in return for entering into a long-term agreement to lease and occupy the building, according to court documents.
The Chamber is seeking about $3.1 million in future rent and about $154,000 for past rent and other expenses.
Once the leased premise was finished, Eagle Creek was set to move into it and out of its temporary housing at the Beacom School of Business and other location northwest of USD along Cherry Street. According to the lawsuit, the Chamber notified Ken Behrendt, president of Eagle Creek, the facility was “substantially completed” in May.
Following the notification, a server and security system was installed in the facility in July, but the company has not moved into the building, and said they need to resolve some “agreement issues.”
The Chamber’s complaint does not explain why Eagle Creek has not moved into the technology center. A spokesperson for Eagle Creek could not be reached for comment.
Nate Welch, executive director for the Vermillion Area Chamber and Development Company, said the city’s partnership with Eagle Creek has been beneficial, despite the contracting dispute.
“It’s sometimes hard to see plans not work out the way we expected,” Welch said. “We have to let this process work itself out, and now we’re kind of in the stage where we just wait.”
Welch declined to comment about the status of the lawsuit.
The Governor’s Office of Economic Development and Vermillion’s Area Chamber of Commerce and Economic Development Company presented the incentive proposal for Eagle Creek to come to Vermillion in Dec. 2012, and the partnership between the city, Eagle Creek and USD was formally announced in March 2013 by Gov. Dennis Daugaard at a press conference held on campus.
The proposal offered to “make substantial monetary payments” to Eagle Creek if the company agreed to come to Vermillion and provide employment to the local workforce. An estimated 200 jobs were created after Eagle Creek announced it would expand to Vermillion.
According to the lawsuit, Eagle Creek agreed to the conditions on Jan. 30, 2013 and later signed the lease on June 13, 2013.
Moran said in addition to the partnership with Eagle Creek, the university is always looking to expand opportunity for students.
“We’re looking to partner with other industries besides Eagle Creek and we’re open to the interest of other IT companies who see this as a potential for hiring our students,” he said. “This was never designed as something exclusive.”
