Transgender advocacy group plans to sue state over contract cancellation

Legal claims will focus on discrimination, civil rights

By: - December 22, 2022 9:57 am
(Illustration by Joshua Haiar/South Dakota Searchlight)

(Illustration by Joshua Haiar/South Dakota Searchlight)

A transgender advocacy organization plans to sue the state of South Dakota for civil rights violations over Gov. Kristi Noem’s abrupt cancellation of a health care facilitation contract with the group.

Brendan Johnson, a former U.S. district attorney who works for the law firm Robins Kaplan, told South Dakota Searchlight that his firm will represent The Transformation Project at no cost in a civil action against the state.

Johnson said he plans to send the state a litigation hold this week, which is a legal notice of pending action that orders the expected defendant to preserve all records and correspondence related to a legal claim.

The group’s claim originates with the contract cancellation, Johnson said, but “it’s not a contract dispute.”

Transformation Project calls termination of state contract ‘unwarranted’

“This is about violating federal law, equal protection,” Johnson said. “You cannot discriminate against people on the basis of sexual orientation or gender identity. We believe that’s in violation of agreements between the state of South Dakota and the federal government that provided these funds.”

The Sioux Falls-based nonprofit was awarded about $136,000 in federal funds to hire and train a community health worker to help connect members of the LGBTQ community to physical and mental health care. The funds, dispensed by the state, were earmarked by the U.S. Centers for Disease Control for the hiring of community health workers to serve rural areas and marginalized communities.

For a story published on Friday, a conservative media outlet questioned Gov. Noem’s office about the contract. Through spokesman Ian Fury, Noem, a Republican, told the outlet that she does not support the group’s “radical ideology,” that she didn’t know about the contract, and that she would order a review of all state Department of Health contracts. More than 60 other community health worker contracts have been granted this year. 

State Health Secretary Joan Adam announced her retirement through a governor’s office press release on Monday, three days after the news broke. 

The Freedom Caucus, a coalition of South Dakota lawmakers aligned with the Freedom Caucus of the U.S. House of Representatives, issued a statement Monday that praised Noem’s decision to cut the contract. It also called on the South Dakota attorney general to investigate The Transformation Project and Sanford Health, which is set to host a Gender Identity Summit next month, for “promoting child abuse.”

Johnson said his firm aims to show that the stated reasons for the contract cancellation do not align with the Noem administration’s actual motivations.

Noem terminates contract for transgender advocacy group

“The facts will show that The Transformation Project did not violate its contract with the state of South Dakota,” Johnson said. “This was a decision based on politics, not the law. We applaud the strength and dignity of the LGBTQ community, and we will aggressively defend their right to access health care and the vital services provided by The Transformation Project, including mental health and suicide prevention services.”

In the cancellation letter, Deputy Health Secretary Lynne Valenti said The Transformation Project had failed to hire a certified community health worker and had missed a required annual conference, among other violations. But The Transformation Project has said it hired a community health worker who is still employed by the group, and the required annual conference took place before the contract was awarded.  

The group’s director, Susan Williams, said in an open letter that the group was in compliance with contract terms. It had received about $23,000 of contract funds before the Dec. 16 cancellation letter.

“We are also deeply concerned by the appearance that the termination of this contract stems not from our actions, but as a result of the population we serve,” Williams said.

Williams named the community health worker hired by the group to South Dakota Searchlight and noted that he’d completed his certification. On Tuesday evening, the group tweeted its congratulations to that employee along with a photo of staff and supporters. Two of the people were wearing hoodies from the Union Gospel Mission, a homeless shelter that had also been awarded funds for a community health worker, and whose director told South Dakota Searchlight this week that his “heart goes out” to the group over the dispute.

The Transformation Project also announced its intention to retain the employee despite the loss of funding. It has since set up a pledge website that asks the public to “raise $105,000 to cover the funding shortfall that was created.”

“These funds will help us to continue to develop a Community Health Worker program and allow our CHW to meet the needs of South Dakota members of the LGBTQ2S community across the state who experience disparate health outcomes,” the site said. 

The group will not be charged legal fees for its action against the state, Johnson said, but taxpayers won’t avoid them. 

“This is incredibly unfair to one of our most vulnerable populations in South Dakota,” Johnson said. “This will be a long and expensive fight. This is going to cost the state of South Dakota a great deal in legal fees.”

Fury, Noem’s spokesman, told South Dakota Searchlight on Tuesday that the state would be unable to comment on The Transformation Project situation because of the threat of litigation. 

On Thursday morning, Fury reiterated that the state cannot comment for that reason. 

On Monday, South Dakota Searchlight sent an email to Fury and Department of Health spokeswoman Kieran Tate, asking if three other community health worker contractors who’d inked deals around the same time as The Transformation Project had complied with each of the same contract requirements. Tate has not replied.

A spokesman for the South Dakota Attorney General’s Office, which typically serves as the state’s legal counsel in lawsuits against state agencies and officials, said the litigation hold had not been received as of Thursday morning.



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John Hult
John Hult

John is the senior reporter for South Dakota Searchlight. He has more than 15 years experience covering criminal justice, the environment and public affairs in South Dakota, including more than a decade at the Sioux Falls Argus Leader.