Sentencing continues tomorrow in the criminal prosecution of the four men whose scheme to circumvent USDA inspection in 2013 caused diseased cattle to end up as human food.
The owner of Rancho Veal, Robert “Bob” Singleton, and Rancho Feeding Corp. yardman Eugene Corda will appear for sentencing on Wednesday in U.S. District Court for Northern California in San Francisco. Felix Sandoval Cabrera, foreman at the Petaluma, CA, slaughterhouse, will be the last to be sentenced on March 9.
Rancho owner Jesse “Babe” Amaral was the first to be sentenced. On Feb. 10 Amaral was sentenced to a year and day in federal prison to be followed by two years of supervised released including one year at a half-way house.
All four men agreed to plead guilty to a single count of conspiracy to distribute adulterated, misbranded, and un-inspected meat. In exchange, the government agreed to drop multiple charges brought in an August 2014 indictment, including fraud and conspiracy.
Their scheme to process diseased cattle, mostly with eye cancers, caused a massive 8.7-million-pound meat recall in February 2014. The slaughterhouse was closed and eventually sold. Recall expenses and other damages cost Rancho’s business associates millions.
The need for a trial went away when the defendants all pleaded guilty. Sentencing documents, however, are beginning to fill in some of the details that would have come out at trial.
Singleton and Amaral met at cattle auctions in the early 1970s and decided to become business partners.
The real property of the Petaluma slaughterhouse was owned by Singleton Investments Inc., and was managed by both the Rancho Veal Corp., also owned by Singleton, and the Rancho Feeding Corp,, owned by Amaral.
Singleton was the cattle buyer at auctions, and also sold processed meat to vendors though his Rancho Veal Corp. Amara’s Rancho Feeding Corp. was the “USDA establishment,” permitted to slaughter and process cattle for human consumption.
Rancho Feeding had “custom slaughter agreements” with Rancho Veal, contracts where it agreed to manage the slaughterhouse and comply with all USDA regulations.
Cabrera, Rancho’s foreman who’d studied to be a USDA inspector, worked for Amaral for more than 30 years.
The 79-year old Singleton claims to have heard about the scheme from the 78-year old Amaral sometime in early 2013. Shortly thereafter, Singleton learned from Amaral that he’d directed Cabrera to bypass ante mortem (before death) inspection procedures if the foreman believed a cow was likely to be marked by an inspector as a “suspect” for condemnation.
Singleton claims not to have known that Amaral and Cabrera had employees carving the “USDA Condemned” stamps out of cattle that had been condemned. Nor did he know that, at Amaral’s direction, Corda was swapping un-inspected cattle showing symptoms of eye cancer for cattle that had already passed ante mortem inspection.
“He did not know that they were placing healthy cow heads next to suspect carcasses,” Singleton’s defense team wrote.
However, there was much Singleton did know.
He “knew Amaral, Cabrera, and Corda were somehow effectively circumventing inspection, and (Singleton) failed to ask questions or take responsibility for putting a stop to the unlawful scheme,” according to court documents. Amaral instructed Singleton to pay Cabrera $50 for every cow he “slipped” past USDA inspection.
“The evidence shows that Corda did not know his codefendants were also processing condemned cattle, or that Ranch’s owners were defrauding farmers in a separate scheme, and he was not charged with those counts in the indictment,” according to the sentencing memorandum filed by Assistant U.S. Attorney Hartley M.K. West.
“Corda also did not profit from his role beyond his regular paycheck, whereas Rancho’s owners and the kill floor foreman, Cabrera, did.”
West says Amaral and Singleton profited from the sale of the “eye cows” and condemned cattle and Amaral from a separate false invoicing scheme.
“Corda was not paid and did not seek compensation.” West wrote. “He was simply trying to keep his job by doing what Amaral told him.”
The government is recommending that the 65-year old Corda be sentenced to three years probation including six months of home confinement, which will apparently allow him to work and take his wife to chemotherapy for treatment of a re-occurrent breast cancer.
Corda worked for Amaral for 30 years, a man he described as “strong-minded” and “dominant and forceful.” Singleton became another of his boss’s in 1997, and like Amaral was known for his lifetime in the cattle business.
“At no time did I ever believe the two men would involve me in a scheme that would threaten the food supply,” Corda said in his pre-sentencing letter to the judge. He eventually realized Amaral and Cabrera had come up with a way to get cattle through without inspection.
Singleton admits he trusted Amaral and Cabrera. Amaral had run the kill floor of the small slaughterhouse for 45 years and Singleton believed his business partner could “distinguish between safe and unsafe conduct,”according to Singleton’s lawyers. They said Singleton especially trusted Cabrera’s expertise in meat inspection.
“Quite frankly, Bob did not trust the federal inspectors working at Rancho at the time, and believed that Cabrera had a better idea of what was a passable cow than those inspectors.” His attorneys said they offered that perspective “to illustrate the Bob at the time never believed that dangerous meat would ever be passed through to consumers.”
“Today Bob deeply regrets his conduct and the significant harm it caused,” wrote the attorneys from Orrick, Herrington & Sutcliffe LLP in San Francisco.
Due largely due to his being the first to fully cooperate in the investigation, the government is recommending Singleton be sentenced to three months in prison and three months of home detention followed by two years of supervised release with 50 hours of community service.
Singleton wants a “non-custodial sentence of probation.”
Whether he stays out of jail may depend upon whether the judge accepts Singleton’s view of the “loss calculation.” The recall of 8.7 million pounds of meat included the production of an estimated 15,600 head of cattle processed by Rancho over the course of a year.
That resulted in a loss of more than $2.5 million.
However, Singleton’s defense argues that the government’s investigation found 180 cows were affected by the criminal conduct and from that number, they could have “profited no more than $90,000.” There is a ten-fold increase in the impact on the sentencing calculation between the two numbers ($90,000 versus $2.5 million)
Singleton has also reached settlement agreements with all but one of companies that were financial harmed by Rancho’s scheme and resulting recall. The payments he has agreed to include:
- RBR Meats/Riteway, $1.5 million;
- BN Ranch, $450,000;
- Tillamook Country Smoker, $7,720; and
- Argus, $3,000.
Singleton’s attorneys have been unable to get a response from Advance Pierre Foods, the only remaining “victim entity.”
“Quite simply, Bob has no more money left, and no ability to pay a fine or further restitution,” his attorneys wrote. “After he pays agreed-to restitution and legal fees, Bob will be in debt.”
The government wants a separate restitution hearing scheduled after tomorrow if any unresolved issues remain after sentencing.
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