IN THE SUPREME COURT

STATE OF NORTH DAKOTA

2023 ND 38

Olympic Financial Group, Inc.

d/b/a OFG, Inc., a sole shareholder

Minnesota Corporation; and Abdulaziz

Sugule, the sole shareholder of 

Olympic Financial Group, Inc., Plaintiffs and Appellants

v.

North Dakota Department of Financial

Institutions, an administrative agency

of the State of North Dakota, Defendant and Appellee

No. 20210361

Appeal from the District Court of Burleigh County, South Central Judicial 

District, the Honorable Lindsey R. Nieuwsma, Judge.

DISMISSED.

Opinion of the Court by Jensen, Chief Justice.

David C. Thompson, Grand Forks, ND, for plaintiffs and appellants.

Courtney R. Titus, Assistant Attorney General, Bismarck, ND, for defendant 

and appellee.

FILED 

IN THE OFFICE OF THE 

CLERK OF SUPREME COURT 

MARCH 3, 2023 

STATE OF NORTH DAKOTA
1

Olympic Financial Group v. ND Dep’t of Financial Institutions

No. 20210361

Jensen, Chief Justice.

[¶1] Olympic Financial Group, Inc., (“Olympic Financial”) and Abdulaziz 

Sugule appeal from a judgment dismissing their declaratory judgment action 

without prejudice after the district court granted the Department of Financial 

Institutions’ (“Department”) motion to dismiss. We conclude the court lacked 

subject matter jurisdiction because Appellants failed to exhaust 

administrative remedies. Because we further conclude the judgment 

dismissing the declaratory relief action without prejudice is not appealable, we 

dismiss the appeal.

I

[¶2] Olympic Financial is a corporation engaged in money transmission. The 

Department administers N.D.C.C. ch. 13-09, governing the licensure and 

activities of money transmitters in North Dakota. The Department issued a 

money transmitter license to Olympic Financial to operate.

[¶3] In July 2020, the Department began administrative proceedings against 

Olympic Financial, issuing an order for revocation and an order to cease-anddesist all money transmission activities in the state. Olympic Financial timely 

appealed and requested an administrative hearing. While Sugule is not a party 

to the administrative proceedings in his individual capacity, Sugule purports 

to be Olympic Financial’s sole shareholder.

[¶4] During the course of the underlying administrative proceedings, the 

parties served each other with discovery requests. Olympic Financial did not 

respond to the Department’s discovery requests within the administrative 

proceedings but alleges that it “notified the Department that substantial risk 

existed for improper compelled self-incrimination on the part of Olympic 

Financial sole shareholder Ab[d]ulaziz Sugule existed for in light of the 

presence of N.D.C.C. § 13-09-22(2), an overly-broad and vague ‘catchall’ 

criminal statute[.]” Olympic Financial asserts it requested that the 

Department agree to a grant of immunity for both Olympic Financial and 
2

Sugule before providing discovery responses. The Department declined to 

enter into an agreement for a grant of immunity and moved to compel discovery 

in the administrative proceedings before the administrative law judge (“ALJ”).

[¶5] Rather than responding to the Department’s motion to compel, Olympic 

Financial and Sugule commenced this action in the district court for a 

declaratory judgment against the Department. Olympic Financial and Sugule 

subsequently filed an amended complaint seeking a judgment declaring that 

N.D.C.C. § 13-09-22, which provides for criminal penalties under N.D.C.C. ch. 

13-09 governing money transmitters, is unconstitutional; declaring that the 

petitioners possess a constitutional right to be free from compelled selfincrimination; and seeking a writ of mandamus compelling the Department to 

recognize the petitioners’ constitutional rights to be free from selfincrimination in pending administrative proceedings.

[¶6] The Department moved the district court to dismiss the action under 

N.D.R.Civ.P. 12(b)(1) and 12(b)(6) asserting, respectively, that the district court 

lacked subject matter jurisdiction over the amended complaint and that the 

amended complaint failed to state a claim upon which relief can be granted 

because Olympic Financial failed to exhaust administrative remedies and a 

justiciable controversy did not exist. Olympic Financial and Sugule opposed 

the Department’s motion. The administrative proceedings against Olympic 

Financial remained pending at the time of the hearing on the motion.

[¶7] After a hearing, the district court granted the Department’s motion to 

dismiss. In its order, the court held that it lacked subject matter jurisdiction 

over both plaintiffs’ claims in the amended complaint based on the failure to 

exhaust administrative remedies before seeking relief in the district court. 

Judgment was entered dismissing the action without prejudice.

II

[¶8] Chapter 32-23, N.D.C.C., authorizes courts to issue declaratory 

judgments, which are reviewed on appeal under the same standards as other 

cases. N.D.C.C. § 32-23-07; Zerr v. N.D. Workforce Safety & Ins., 2017 ND 175, 

¶ 9, 898 N.W.2d 700; Nationwide Mut. Ins. Cos. v. Lagodinski, 2004 ND 147, ¶ 
3

7, 683 N.W.2d 903. Under N.D.C.C. § 32-23-01, a “court of record within its 

jurisdiction shall have power to declare rights, status, and other legal relations 

whether or not further relief is or could be claimed.” Section 32-23-02,

N.D.C.C., provides that “[a]ny person . . . whose rights, status, or other legal 

relations are affected by a statute . . . may have determined any question of 

construction or validity arising under the . . . statute . . . and may obtain a 

declaration of rights, status, or other legal relations thereunder.”

[¶9] A court may refuse to render a declaratory judgment if the judgment 

would not terminate the uncertainty or controversy giving rise to the 

proceeding. N.D.C.C. § 32-23-06. When declaratory relief is sought, all persons 

having or claiming any interest that would be affected by the declaration must 

be made parties, and a declaration may not prejudice the rights of persons not 

named as parties to the proceeding. N.D.C.C. § 32-23-11. The declaratory relief 

provisions under N.D.C.C. ch. 32-23 are remedial and are construed and 

administered liberally to afford relief from uncertainty and insecurity about 

rights, status, and other legal relations. N.D.C.C. § 32-23-12. “The declaratory 

judgment statutes are not jurisdictional.” City of Harwood v. City of Reiles 

Acres, 2015 ND 33, ¶ 12, 859 N.W.2d 13 (citing State v. J.P. Lamb Land Co., 

359 N.W.2d 368, 369 (N.D. 1984)).

[¶10] This Court has long held that “[t]he exhaustion of administrative 

remedies is a prerequisite to seeking declaratory relief.” Cont’l Res., Inc. v. N.D. 

Dep’t of Envtl. Quality, 2019 ND 280, ¶ 10, 935 N.W.2d 780; see also Zerr, 2017 

ND 175, ¶ 12; Medcenter One, Inc. v. N.D. State Bd. of Pharmacy, 1997 ND 54, 

¶ 12, 561 N.W.2d 634; Tooley v. Alm, 515 N.W.2d 137, 139 (N.D. 1994); Transp. 

Div. of Fargo Chamber of Com. v. Sandstrom, 337 N.W.2d 160, 162-63 (N.D. 

1983); Shark Bros., Inc. v. Cass Cnty., 256 N.W.2d 701, 705-06 (N.D. 1977). 

This Court has recognized that dismissal for lack of subject matter jurisdiction 

under N.D.R.Civ.P. 12(b)(1) is appropriate when a plaintiff fails to exhaust 

administrative remedies. Vogel v. Marathon Oil Co., 2016 ND 104, ¶¶ 7-8, 879 

N.W.2d 471; see also Armstrong v. Helms, 2022 ND 12, ¶ 7, 969 N.W.2d 180; 

Thompson v. Peterson, 546 N.W.2d 856, 861 (N.D. 1996). A dismissal for lack of 

subject matter jurisdiction is reviewed de novo on appeal when the 

jurisdictional facts are not in dispute. Vogel, at ¶ 7.
4

[¶11] Here, the district court held that it lacked subject matter jurisdiction 

over the action seeking declaratory relief because Olympic Financial and 

Sugule failed to exhaust administrative remedies in the proceedings before the 

Department. Because the court dismissed the entire action without prejudice, 

we examine whether the judgment is appealable.

A

[¶12] “The right of appeal is governed solely by statute in this state[.]” Mann 

v. N.D. Tax Comm’r, 2005 ND 36, ¶ 7, 692 N.W.2d 490; see also N.D.C.C. § 32-

23-07 (“All orders, judgments, and decrees under [N.D.C.C. ch. 32-23] may be 

reviewed as other orders, judgments, and decrees.”). Section 28-27-02, 

N.D.C.C., provides:

The following orders when made by the court may be carried to the 

supreme court:

1. An order affecting a substantial right made in any action, 

when such order in effect determines the action and prevents 

a judgment from which an appeal might be taken;

2. A final order affecting a substantial right made in special 

proceedings or upon a summary application in an action 

after judgment;

3. An order which grants, refuses, continues, or modifies a 

provisional remedy, or grants, refuses, modifies, or dissolves 

an injunction or refuses to modify or dissolve an injunction, 

whether such injunction was issued in an action or special 

proceeding or pursuant to the provisions of section 35-22-04, 

or which sets aside or dismisses a writ of attachment for 

irregularity;

4. An order which grants or refuses a new trial or which 

sustains a demurrer;

5. An order which involves the merits of an action or some 

part thereof;

6. An order for judgment on application therefor on account 

of the frivolousness of a demurrer, answer, or reply; or

7. An order made by the district court or judge thereof 

without notice is not appealable, but an order made by the 

district court after a hearing is had upon notice which 

vacates or refuses to set aside an order previously made 
5

without notice may be appealed to the supreme court when 

by the provisions of this chapter an appeal might have been 

taken from such order so made without notice, had the same 

been made upon notice.

[¶13] “Ordinarily, a dismissal without prejudice is not appealable because 

either side may commence another action.” State by & through Workforce 

Safety & Ins. v. Boechler, PC, 2022 ND 98, ¶ 7, 974 N.W.2d 409 (quoting Rolette 

Cnty. Soc. Serv. Bd. v. B.E., 2005 ND 101, ¶ 4, 697 N.W.2d 333). A dismissal 

without prejudice may be final and appealable, however, “if the plaintiff cannot 

cure the defect that led to dismissal” or “if the dismissal has the practical effect 

of terminating the litigation in the plaintiff’s chosen forum[.]” Rodenburg v. 

Fargo-Moorhead Young Men’s Christian Ass’n, 2001 ND 139, ¶ 12, 632 N.W.2d 

407; see also Boechler, at ¶ 7; Vogel, 2016 ND 104, ¶ 6; Haugenoe v. Bambrick, 

2003 ND 92, ¶ 2, 663 N.W.2d 175 (quoting Jaskoviak v. Gruver, 2002 ND 1, ¶ 

8, 638 N.W.2d 1) (where a statute of limitations has run, a dismissal “effectively 

forecloses litigation in the courts of this state”).

[¶14] The district court in this case dismissed the claims for declaratory relief 

of both plaintiffs—Olympic Financial, the corporation subject to the 

Department’s administrative proceedings, and Sugule, Olympic Financial’s 

purported sole shareholder—without prejudice based on the failure to exhaust 

administrative remedies. 

[¶15] In failing to exhaust administrative remedies, the judgment dismissing 

the declaratory judgment action without prejudice may be final and appealable 

if Appellants cannot cure the defect that led to dismissal or if the dismissal has 

the practical effect of terminating the litigation in their chosen forum.

[¶16] In Vogel, 2016 ND 104, ¶ 6, this Court held that a dismissal without 

prejudice was appealable even though administrative remedies had not been 

exhausted. The plaintiff, Vogel, individually and on behalf of those similarly 

situated, sued defendant Marathon Oil Company seeking declaratory relief as 

well as money damages for failure to pay royalties on flared gas. Id. at ¶ 3. 

Vogel appealed from a district court judgment dismissing her complaint 

without prejudice for failure to exhaust administrative remedies. Id. at ¶ 1. 
6

Vogel argued on appeal that her claims should not have been dismissed 

because she had a private right of action for violations of N.D.C.C. § 38-08-06.4 

and was not required to exhaust administrative remedies. Vogel, at ¶ 1.

[¶17] While we ultimately affirmed the district court in concluding Vogel was 

required to exhaust her administrative remedies before pursuing any claims 

in court, we initially concluded the dismissal “without prejudice” was 

appealable because the judgment had the practical effect of terminating the 

litigation in Vogel’s chosen forum:

Vogel argues the judgment dismissing her complaint without 

prejudice is appealable. Marathon does not dispute that the 

judgment is appealable. A dismissal without prejudice generally is 

not appealable, but it may be final and appealable if it has the 

practical effect of terminating the litigation in the plaintiff’s 

chosen forum. The judgment requires Vogel to pursue her 

administrative remedies and terminates her attempt to seek 

damages through the courts individually and as a class action. The 

judgment has the practical effect of terminating the litigation in 

Vogel’s chosen forum. We conclude the judgment in this case is 

appealable.

Vogel, 2016 ND 104, ¶ 6 (emphasis added) (citation omitted). Our decision in 

Vogel, however, is distinguishable and does not support appealability for the 

judgment dismissing this declaratory relief action without prejudice.

[¶18] In Vogel, the district court had concluded N.D.C.C. ch. 38-08 provided 

the exclusive administrative remedies and N.D.C.C. § 38-08-06.4 did not 

provide an express or implied private right of action. 2016 ND 104, ¶ 5. We 

held the judgment therefore limited Vogel to administrative remedies and 

terminated her attempt to seek damages, both individually and as a class 

action, by way of a purported implied private cause of action through the 

courts. Vogel, at ¶ 6. Under those circumstances, we held the judgment 

dismissing the complaint without prejudice was appealable because it had the 

practical effect of terminating the litigation in the plaintiff’s chosen forum.

[¶19] In contrast, Appellants’ claims in this declaratory judgment action 

specifically derive from or have arisen because the Department exercised its 
7

administrative executive power to regulate money transmitters. The 

underlying administrative proceedings against Olympic Financial before an 

ALJ are pending, which relate to the license revocation order, the cease-anddesist order, and the ensuing discovery dispute. The Administrative Agencies 

Procedure Act, N.D.C.C. ch. 28-32, provides for a statutory right to appeal and 

judicial review in the courts. See, e.g., N.D.C.C. §§ 28-32-33, 28-32-42, 28-32-

46, 28-32-49.

[¶20] The district court’s judgment dismissing Appellants’ claims for 

declaratory relief without prejudice does not terminate an independent 

statutory claim or a cause of action attempting to seek damages through the 

courts, like in Vogel. The court’s dismissal without prejudice also does not have 

the practical effect of terminating litigation in Appellants’ chosen forum after 

Olympic Financial appealed from and requested an administrative hearing on 

the Department’s administrative orders. Rather, the dismissal without 

prejudice merely defers the district court’s consideration of the claims raised 

in this declaratory judgment action.

[¶21] Appellants argue the judgment dismissing its declaratory relief action 

without prejudice is appealable because this case falls within exceptions to the 

exhaustion requirement. In Zerr, 2017 ND 175, ¶¶ 12-13, this Court discussed 

the purpose for requiring exhaustion before granting declaratory relief:

The purpose of requiring exhaustion of remedies has its basis in 

the separation of powers doctrine. Requiring exhaustion accord[s] 

recognition to the ‘expertise’ of the [administrative agency’s] quasijudicial tribunal, permitting it to adjudicate the merits of the 

plaintiff’s claim in the first instance. Requiring exhaustion also 

promotes judicial efficiency.

Therefore, [w]hen appellate processes are available and the 

remedies will provide adequate relief, those remedies must be 

exhausted before seeking judicial remedies, unless exhaustion 

would be futile. In addition to futility, we will not require 

exhaustion of administrative remedies when a legal question 

simply involves statutory interpretation and does not need the 

exercise of an agency’s expertise in making factual decisions. We 

have also said requiring exhaustion depends on considerations 
8

including whether the issues need the expertise of an 

administrative body, the interpretation of a statute, or the 

resolution of a pure question of law.

(Citations and quotation marks omitted.)

[¶22] Appellants contend exhaustion of administrative remedies is not 

required and they are entitled to declaratory relief because this declaratory 

judgment action involves statutory interpretation on the constitutionality of 

N.D.C.C. § 13-09-22, where expertise of the administrative agency is not 

necessary; because important constitutional questions exist that are collateral 

to the factual subject matter of the Department’s administrative proceedings; 

and because the administrative agency is inadequate to adjudicate 

constitutional questions and it would be futile. They alternatively assert this 

Court should exercise its discretion to hear the appeal given the remedial 

nature for declaratory judgments.

[¶23] The Department responds that the judgment is not appealable because 

Appellants can cure the defect that led to the district court’s dismissal of the 

case by exhausting remedies in the administrative proceedings and properly 

perfecting an appeal from the administrative decision to the district court. The 

Department argues the court’s dismissal did not have the practical effect of 

terminating the litigation in Olympic Financial’s “chosen forum” because the 

administrative proceedings would have simply continued.

[¶24] Appellants rely on Medcenter One, 1997 ND 54, ¶¶ 11-12, which 

discusses the “bundle of considerations” in deciding whether to apply the 

exhaustion doctrine and exceptions to the doctrine:

The doctrine preserves agency authority by recognizing the 

agency’s initial decisionmaking responsibility. [5 Stein, Mitchell, 

Mezines, Administrative Law § 49.01 (1997).] The requirement for 

exhaustion is particularly weighty when the agency’s decision 

involves factual issues or administrative expertise. See Medical 

Arts Clinic, P.C. v. Franciscan Initiatives, Inc., 531 N.W.2d 289 

(N.D. 1995). The exhaustion prerequisite establishes an efficient 

method for dispute resolution by giving the agency a chance to 

correct its mistakes before being sued. Id. If the agency has an 
9

opportunity to correct its own errors, a judicial controversy may be 

mooted or, at a minimum, piecemeal appeals may be avoided. See

5 Stein, Mitchell, Mezines at § 49.01. And, where the dispute is not 

resolved at the administrative level, the exhaustion of remedies 

will generally develop a complete record for judicial review, 

especially in technical or complex factual situations. See Medical 

Arts. These factors recognize a vital role for exhaustion of 

administrative remedies in the relationship between the executive 

and the judicial branches of government.

Notwithstanding these institutional justifications 

[supporting exhaustion of remedies], the exhaustion doctrine has 

several well-recognized exceptions, including when a legal 

question simply involves statutory interpretation and does not 

need the exercise of an agency’s expertise in making factual 

decisions. See generally 2 Am.Jur.2d Administrative Law at § 511; 

5 Stein, Mitchell, Mezines at § 49.02. In Shark Brothers, Inc. v. 

Cass County, 256 N.W.2d 701 (N.D. 1977), we explained that 

application of the exhaustion doctrine depends upon a bundle of 

considerations, including whether the issues need the expertise of 

an administrative body, the interpretation of a statute, or the 

resolution of a pure question of law. See also Kessler v. Board of 

Educ. of City of Fessenden, 87 N.W.2d 743 (N.D. 1958) (no 

requirement for exhaustion of administrative remedies where 

construction of statute involved pure legal question customarily 

decided by courts). Shark Brothers acknowledges that exhaustion 

of administrative remedies is not a rigid prerequisite for a 

statutory interpretation that does not infringe on an agency’s 

factual decisionmaking process.

One of the above-noted authorities, however, further discussed criticism of 

exceptions for constitutional questions or purely legal questions:

Some courts have established their own categorical 

breakdowns of exceptions, or added additional categories. Many of 

these variations suggest another exception should be allowed 

when constitutional questions are at issue. This additional 

exception has been criticized, especially when eventual judicial 

review could deal with the constitutional issues after the agency 

has had the opportunity to amend its position and possibly avoid 

the need for a constitutional decision. Similarly, several courts 

allow an exception when the question presented is purely legal, 
10

such as a question of statutory interpretation, where a factual 

record is unnecessary. Both of these “additional” exceptions may, 

however, be categorized as problems for which emergency 

remedies are “inadequate,” or for which the solutions are in excess 

of the agency’s statutory authority, obviating the need for added 

categories. Also, it is neither necessary nor advisable to avoid the 

doctrine each time a constitutional or legal issue is raised.

5 Jacob A. Stein & Glenn A. Mitchell, Administrative Law § 49.02 (2022) 

(emphasis added) (footnotes omitted).

[¶25] In this case’s procedural posture, the dispositive question is the 

appealability of the district court’s judgment dismissing without prejudice. 

After the dismissal, Appellants have not been left in a position where a statute 

of limitations has run, where it cannot cure a defect leading to the dismissal, 

or where an independent claim or cause of action is barred in a subsequent 

action based on its failure to exhaust administrative remedies. Appellants have 

remedies in the underlying administrative proceedings. It is undisputed 

administrative proceedings involving Olympic Financial have commenced, are 

pending, and have been continued until disposition of this action. This action 

for declaratory judgment has effectively forestalled or usurped the 

administrative proceedings before discovery was completed, before an 

administrative evidentiary hearing was held, and before an appeal of an ALJ’s 

decision to the district court could be taken. 

[¶26] We conclude the judgment dismissing without prejudice neither prevents 

Appellants from curing the defect leading to the dismissal nor has the practical 

effect of terminating litigation in their chosen forum. The judgment dismissing 

the Appellants’ declaratory relief action without prejudice is therefore not 

appealable.

B

[¶27] Appellants nevertheless argue they should not be required to first 

litigate state and federal constitutionally-based declaratory judgment claims 

before the Department because if N.D.C.C. § 13-09-22(2) is unconstitutional, 

any proceedings under it are in excess of a court’s jurisdiction, and the same 
11

principle applies to administrative agency proceedings. They assert the 

declaratory judgment action seeks to declare the “strict liability” provision, 

N.D.C.C. § 13-09-22(2), violates their rights to due process under the state and 

federal constitutions. They again argue exhaustion is not required because the 

subject matter of this declaratory judgment action involves statutory 

interpretation, in which the expertise of the administrative agency is not 

necessary to determine a “purely legal issue” collateral to the license year 

revocation; because important collateral constitutional questions exist; and 

because the Department is inadequate to adjudicate constitutional questions.

[¶28] However, in Johnson v. Elkin, 263 N.W.2d 123, 127 (N.D. 1978), this 

Court explained that constitutional issues may be presented even when the 

agency does not have the authority to decide:

We adhere to the rule that evidence should be presented to 

the administrative agency, even though that evidence may relate 

to a constitutional issue which that agency has no power to decide. 

Very often the evidence on the constitutional issue will also be 

relevant to other issues before the agency. Even if additional 

evidence is taken on the constitutional issue, the time spent in 

taking it will be justified by the fact that the record will be in one 

unit and only one evidentiary hearing will be needed. However, the 

rule that evidence should be presented to the administrative 

agency does not preclude the raising of the constitutional issue at 

that level, either during the proceeding or by petition for 

rehearing. The administrative agency may, if it wishes, indicate its 

views as to constitutionality, but such views are not to be 

considered as binding.

[¶29] Appellants’ arguments on appeal are unavailing. In Brown v. State ex rel. 

State Bd. of Higher Educ., 2006 ND 60, ¶ 8, 711 N.W.2d 194, this Court 

reiterated that “past decisions holding the constitutionality of an act 

administered by an agency may be raised for the first time on appeal to the 

district court do not abolish the requirement for exhaustion of administrative 

remedies before suing in court.” See also Thompson, 546 N.W.2d at 863 (same).

[¶30] Moreover, in Medical Arts Clinic, P.C. v. Franciscan Initiatives, Inc., 531 

N.W.2d 289, 296-98 (N.D. 1995), a case addressing administrative discovery, 
12

this Court thoroughly discussed the law in effect at the time and a hearing 

officer’s authority in administrative discovery. This Court explained that 

“regardless of the correctness of a hearing officer’s answers to administrative 

discovery questions, the Legislature has conferred statutory authority upon 

the hearing officer to decide those questions[.]” Id. at 298. These principles 

remain true under present law. See N.D.C.C. § 28-32-33. 

[¶31] The district court did not err in concluding the Appellants’ constitutional 

claims did not provide an exception to the doctrine to exhaust administrative 

remedies in this case.

C

[¶32] Sugule, as Olympic Financial’s purported sole shareholder, argues he

also possesses a right to be free from compelled self-incrimination under the 

federal and state constitutions in the pending administrative proceedings.

[¶33] While Sugule attempts to bootstrap his individual objections to the 

discovery sought to be compelled from Olympic Financial, this issue is clearly 

intertwined with the underlying motion to compel in the administrative 

proceedings and is subject to an ALJ’s fact-finding and decision-making. Our 

decision in Medical Arts, 531 N.W.2d 289, is again instructive, in which this 

Court concluded both a party and a nonparty from whom discovery is sought 

in an administrative proceeding must exhaust their administrative remedies.

[¶34] In Medical Arts, 531 N.W.2d at 298, Medical Arts was a nonparty to the 

administrative proceeding and asserted a trade-secret claim. Because of 

Medical Arts’ nonparty status, this Court stated that “the procedure for judicial 

review of Medical Arts’ claim, is not as clear [as a party’s procedure].” We 

further explained, however, that “Medical Arts must first exhaust its 

administrative remedies so the hearing officer has an opportunity to 

specifically rule on its claim. Those administrative remedies include asking the 

hearing officer to issue a protective order, or to quash or modify a subpoena.” 

Id. (citation omitted).
13

[¶35] Recognizing Medical Arts could exhaust its administrative remedies 

and the hearing officer could deny Medical Arts’ trade-secret claim, this Court 

also noted Medical Arts had no assurances Franciscan would not disclose the 

information before judicial review was available. “Disclosure by Franciscan 

under those circumstances would impose upon Medical Arts the impossible 

task of seeking a remedy that would ‘unring a bell.’” Medical Arts, 531 N.W.2d 

at 298. We addressed that possibility, holding “that if the impact of an order 

compelling disclosure of claimed trade secrets cannot be ‘unmade’ and, after 

exhaustion of administrative remedies, there is no other recourse for an entity 

like Medical Arts, a writ of prohibition may be sought for judicial review of the 

hearing officer’s trade-secret decision.” Id. at 299. Medical Arts therefore 

stands for the proposition that, under the limited circumstances when judicial 

review will not provide a meaningful remedy because of the impact of the 

hearing officer’s discovery ruling, a nonparty may seek a writ of prohibition for 

judicial review of the hearing officer’s decision. However, that remedy is only 

potentially available when the nonparty first exhausts the nonparty’s 

administrative remedies.

[¶36] Here, the record indicates Sugule did not exhaust administrative 

remedies. Had he done so, it is possible the ALJ would have issued an order 

addressing Sugule’s concerns. However, he made no attempt to permit the ALJ 

to address the issue. Based on Medical Arts, the judgment dismissing the 

declaratory judgment action without prejudice is not appealable as to Sugule 

because he did not exhaust his administrative remedies.

[¶37] We conclude the discovery issues must be litigated through the pending 

administrative proceedings before reaching a final disposition in the district 

court. Olympic Financial and Sugule must exhaust the administrative 

remedies in the underlying administrative proceedings before pursuing

judicial remedies in the district court. The judgment dismissing the action for 

declaratory relief without prejudice is not appealable and dismissal of its 

appeal is appropriate.
14

III

[¶38] We conclude the remaining arguments are either without merit or 

unnecessary to our decision. The appeal is dismissed.

[¶39] Jon J. Jensen, C.J.

Daniel J. Crothers

Lisa Fair McEvers

Jerod E. Tufte

Douglas A. Bahr