CEDAR RAPIDS, Iowa — A former Mason City doctor won a $2 million federal lawsuit against a wealthy Irish investor when a Sioux City jury agreed the Dublin native reneged on a major development deal he struck with the Croatian doctor to build ethanol plants in eastern Europe.

The plaintiff, Branimir Catipovic, now a doctor at the Veterans Affairs Hospital in Des Moines, proved his civil claim of unjust enrichment against Mark Turley, a federal jury in the U.S. District Court for the Northern District of Iowa in Sioux City ruled on Nov. 21.

Although the jury initially ruled against Catipovic’s breach of contract claim, he was able to prove Turley received the benefit of his services without compensating him, court documents revealed.

According to the case file, Catipovic said he began studying ethanol production and then toured the Golden Grain Energy, LLC ethanol plant in Mason City shortly after moving there to practice medicine. During the ethanol boom of the 2000s, Catipovic began working with industry professionals like Walter Wendland, then CEO of Golden Grain, to develop a plan to commence building ethanol plants in Croatia as agreed upon by Turley.

When Catipovic and Wendland recognized the potential to replicate the success of the Golden Grain plant in Eastern Europe, they gathered “critical operational and financial information and then traveled to Croatia in July 2006, where they selected a site to build an ethanol plant,” the Mason City Globe-Gazette reported.

But while Turley agreed to invest $40 million in the deal to become 80 percent owner, Catipovic argued Turley took over the idea, as well as the proposed project, and built the ethanol facilities in Dunafoldvar, Hungary, instead, essentially cutting Catipovic out of the deal.

“The agreement between Catipovic and Turley was drawn by Turley and contained 13 points, which mostly boiled down to Turley committing $40 million for 80 percent of the venture Catipovic and Wendland commenced to develop ethanol in the European Corn Belt,” said Kevin Visser, an attorney with Simmons, Perrine, Moyer and Bergman, PLC in Cedar Rapids, who represented Catipovic.

“Turley refused to enter into a ‘shareholders agreement’ with Catipovic (or Wendland), which contained these ‘main points’ (including the equity commitment and the 80/20 split). Turley reneged because 80 percent was not enough to satisfy him. Though Catipovic and Wendland remained flexible, Turley would move the goalposts every time they’d agree to further concessions.”

The Globe-Gazette reported in June 2007, Catipovic and Wendland entered into an agreement with Turley, who supplies startup capital and invests in new businesses, to build ethanol plants in Eastern Europe – the first was to be built in Croatia.

According to the lawsuit, Wendland and Catipovic were to receive a 20 percent interest in the ethanol plants, with Ronald Fagen of Granite Falls, Minn.-based Fagen, Inc. – a full-service international contractor, mainly focusing on ethanol plants – retained as the builder of the Croatia plant.

Shortly after Catipovic and Turley met in Ireland in early 2008 to negotiate issues regarding the shareholders agreement for the project, according to court documents, Catipovic said upon leaving Ireland, Turley “inexplicably and unilaterally refused to move forward with the agreement and ordered that all work on the shareholders agreement cease.”

Moreover, the lawsuit alleged Turley and Fagen “secretly planned to move forward” without Catipovic and Wendland; however, after Turley failed to obtain the real estate Catipovic previously secured in Croatia, he and Fagen decided to build a plant in Hungary.

“Ultimately, Turley simply built the plant with Fagen – and without Catipovic or Wendland,” Visser said. “The trial testimony was that many had tried, but this is the only successfully-built and operating American-style plant in Europe.”

Visser told Farm World none of the people involved in Turley’s alleged takeover knew each other before being introduced to Catipovic’s plan that he originally shared with Turley – and “all are now owners and managers of this enterprise.

“I think these ‘smart guys’ knew a good deal when they saw one,” he said.