July 15 2009 – Heemstra Trial

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Des Moines Register. William Petroski. July 15, 2009.

July 15 2009 - Heemstra Trial

Indianola, Ia. – Rodney Heemstra testified today his bustling farm operation collapsed after he was arrested for killing fellow Milo farmer Tom Lyon in January 2003, forcing him to liquidate his assets and sending his financial worth plunging.

Heemstra and wife, Berta, had owned about 1,600 acres of farmland in Warren County and in northern Iowa. They also rented more than 2,000 acres of farm ground. The couple listed a net worth of about $4.1 million on a financial statement filed just days before the slaying.

Heemstra testified in a civil trial in Warren County District Court today that his widely publicized arrest for killing Lyon immediately made it impossible for him to operate his farms.

Although he was subsequently released from jail on bond before he went to trial on criminal charges, he said the barriers he faced in the farming community were insurmountable.

After lenders learned of his arrest, they informed him they wouldn’t provide him loans to plant crops in the spring of 2003, Heemstra said. Then his hired man quit. Then he was forced to sell his farm machinery. Then his suppliers told him they didn’t want to do business with him any more, he testified.

“Frankly, psychologically, I wouldn’t have been able to do it even if those other factors hadn’t been present,” Heemstra told Judge Paul Huscher, who is presiding over the case.

Heemstra was on the witness stand today during the eighth day of a trial in which Lyon’s estate is accusing him of conspiring to conceal millions of dollars in assets in an effort to avoid paying a $5.68 million wrongful-death judgment to Lyon’s family. The plaintiffs alleged Heemstra, with the cooperation of relatives, have conducted a series of scam transactions involving farmland and other assets through family trusts and other business entities.

Heemstra spent four years in prison for a voluntary manslaughter conviction before he was freed last October. He killed Lyon with a gunshot to the forehead after the two Milo farmers quarreled over farmland and cattle-watering equipment.

Heemstra has said he doesn’t have the money to pay the $5.68 million in damages to Lyon’s family. His lawyers portray him as a farmer who was burdened with debt and financially overextended at the time of the slaying. They deny there has been any effort to hide the Heemstras’ assets.

Defense lawyer Joel Baxter questioned Heemstra today about his finances before and after the killing. Heemstra explained that in the process of liquidating his farm operation, he sold farm machinery, farm land and other assets, and used the proceeds to make payments against his debts.

Heemstra also acknowledged a bad experience in the commodities trading market, losing about $600,000 in his commodities account after the slaying. He was unable to make margin calls on the account and it was liquidated about Jan. 20, just days after his arrest, he testified.

He said it had been his belief earlier that farm commodities market were going to go up, so he established commodity positions reflecting his optimism.

“Obviously it wasn’t the best move because it was very negative,” he said.

Other factors affected his personal finances as well, Heemstra testified, including attorneys’ bills of more than $200,000 in 2003 when he first faced trial for killing Lyon.

The civil trial is to continue on Thursday, with a day off on Friday. Lawyers for both sides said they expect the case to be wrapped up on Monday. Judge Huscher, who is hearing the case without a jury, is expected to issue a ruling within the next few months.