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Okay guys I went to the gun store, the instructor wasn't there and it was his two days off. I decided to ask one of the other guys behind the counter about this "law" and he said it's not a law. I apologize greatly for everyone. I was told one thing and that wasn't really it. However, the guy behind the counter (I forgot his name) told me it's told as a scare to people who aren't fluent with the politics behind firearms not as a means to sell expensive JHP to them, but to ensure that newbies (like me and many others) who decide to engage in the use of a firearm in SD don't make the mistake of using FMJ's and incidentally wound or kill someone else, which can result in a HUGE prosecution by the DA and families of the innocent that will leave me with my clothes on the street after lots of time in prison.
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So basically the guy 'fessed up about the lie and then claimed it wasn't for profit to to protect you from yourself?
Smart money would have you never doing business with those folks again. It certainly is not ethical to lie to you, even if it is supposedly for your own good. I would not be in a hurry to believe the cover story for why they lied to you either.
I think that if you do some research, you will find that overpenetration from handgun fmj is very rare and that "incidentally" wounding or killing someone else is instead most often due to missing the intended target.