When security guards in downtown St. Paul accused downtown St. Paul’s largest property owner of wage theft, Minnesota Attorney General Keith Ellison’s office opened an investigation, which Ellison said was slowed by the company’s refusal to hand over payroll records.

The legal back-and-forth to obtain access to the records took more than three years, but Ellison’s office eventually filed a civil enforcement action alleging violations of the state’s Fair Labor Standards Act.

Madison Equities, then led by principal Jim Crockarell, argued that the civil action was moot as a two-year statute of limitations for wage-theft claims had run out. Ramsey County District Court agreed, as did the Minnesota Court of Appeals.

On Wednesday, the Minnesota Supreme Court overruled the lower courts, reopening the case by sending it back to the district court to reinstate the wage-theft claims for further proceedings. The opinion was not unanimous, and raised concern with two dissenting justices that it effectively rewrites civil procedure, however narrowly.

Question of ‘tolling’

The question before the justices centered on “tolling,” or when to suspend a time clock around the statute of limitations. The court noted that six security guards came forward with concerns about wage theft in the fall of 2019, prompting the attorney general’s office to file a civil investigative demand for payroll records that Crockarell refused to produce until July 2022.

Madison Equities initially responded with litigation of its own calling the records request overly broad, a case that was decided by the Minnesota Supreme Court in December 2021. The court found at the time that Ellison’s office could seek payroll information related specifically to the company’s hourly workers at 10 downtown buildings, but not related to all workers within the company’s 30 or more subsidiaries.

After finally obtaining the payroll records, Ellison’s office sued Madison Equities in June 2023, arguing that the company failed to pay overtime wages to security guards working at the First National Bank Building, the Lowry Building, the U.S. Bank Center, the Alliance Center, Park Square Court and the Stadium Ramp. The attorney general’s office alleged that workers would punch in and out of the job as they moved from building to building, as if each subsidiary was a separate company.

When the security guards worked more than 48 hours, they received separate paychecks, allowing Madison Equities to avoid paying time-and-a-half, according to the attorney general’s office.

Case dismissed — and then reinstated

Madison Equities then convinced the district court that under the rules of civil procedure, the time clock on the two-year statute of limitations began in late 2019 at the latest, not late 2021, and the case should be dismissed for lack of timeliness. The Court of Appeals agreed. The Supreme Court on Monday said otherwise.

Madison Equities “produced no responsive documents until February 2022 … and did not submit its last set of responsive documents until July 2022,” wrote Justice Anne McKeig for the majority.

“We hold that the litigation over the (civil investigative demand) tolled the applicable limitations period,” she wrote. “Our holding today applies narrowly to a situation where the Attorney General exercises authority granted by the Legislature under Minnesota Statutes … to investigate and enforce … laws respecting unfair, discriminatory or other unlawful practices in business, commerce, or trade.”

Ellison’s office had expressed concern that in future cases, companies could use litigation to stall for time and likewise run out the clock. The Supreme Court clarified that the attorney general’s civil investigative demand for payroll records alone did not pause the statute of limitations, but the legal resistance to it did.

“It is the litigation over the CID that tolls the limitations period — not simply the service of the CID that triggers tolling,” McKeig wrote.

Dissenting opinion

The 23-page decision was followed by a 23-page dissent authored by Justice Paul Thissen, who was joined in dissent by Justice Sarah Hennesy.

The dissent argued that under the court decision, the statute of limitations could, in theory, be extended indefinitely based on when the attorney general arbitrarily “becomes satisfied” that enough evidence has been handed over to begin a legal claim, effectively running the clock forever. The office, he wrote, could have sued earlier.

“From where I stand, it appears the court is manufacturing a new tolling rule because the Attorney General missed a limitations period deadline in a single case,” Thissen wrote.

Crockarell, who held stakes in at least 32 buildings across the metro, died in January 2024, and several Madison Equities properties in downtown St. Paul have since fallen into foreclosure after being put up for sale en masse by his widow.