After more than six years of investigation, poring over more than 1 million documents and wiretaps, and the guilty pleas of 10 midlevel food-industry executives, the federal government hit the bull's-eye Friday.
Frederick Scott Salyer, the 56-year-old scion of one of California's most colorful and prominent agriculture families, pleaded guilty to racketeering and price-fixing in a deal favorable to him that calls for no more than seven years in prison.
Salyer, the former owner and chief executive officer of SK Foods LP in Monterey and a multimillionaire whose firm provided tomato products that ended up in most of the homes in this country, had faced up to 20 years in prison if convicted at trial of plotting widespread bribery as part of a conspiracy to gain the upper hand on his competitors.
Salyer was said to have provided more than $100,000 in bribes to purchasing agents at firms such as Frito-Lay, Kraft Foods, Safeway and ConAgra to win sales contracts and to have falsified records that enabled the sale of old and moldy tomato products that found their way in the American food chain.
Since his arrest and indictment in 2010, he has fought the case tooth and nail. But on Friday, after stopping at a Starbucks near the federal courthouse in downtown Sacramento with a friend from his college days, Salyer walked into U.S. District Judge Lawrence K. Karlton's courtroom and pleaded guilty to two felony counts.
Prosecutor Matthew Segal will argue for seven years when Salyer is sentenced. A defense team led by legendary San Francisco attorney John Keker will seek four years. Approximately two years will be shaved off the time behind bars for good behavior and a stretch he did in jail.
Salyer also must turn over his interest in $3.25 million in an Andorra bank account he opened after learning he was under investigation.
If the judge seeks to impose more than seven years, Salyer can back out of the plea deal.
Clad in a blue blazer and gray slacks, he responded to questions from Karlton with a calm, courteous demeanor. The closest he came to evincing concern was when he turned to his daughter Stefanie in the courthouse rotunda and asked, "How are the dogs?" Salyer treats his Cavalier King Charles spaniel, which his daughter is caring for, like a member of his family.
His Sacramento attorney, Malcom Segal, in an interview with The Bee, called the plea agreement "an appropriate resolution to a long, complex and difficult case for both sides."
"Mr. Salyer has had a very successful and brilliant career as a businessman, for which he can be proud," Malcolm Segal told The Bee. "He is not proud of the conduct which has led to his plea of guilty."
The plea came during what the court's calendar said would be a routine status conference, and marks the end of one of the largest scandals to hit the U.S. food industry.
In a press conference after the hearing, federal officials said Salyer had fallen victim to avarice.
"Scott Salyer put greed ahead of concern for his employees and consumers worldwide," said Herb Brown, special agent in charge of the Sacramento FBI field office.
U.S. Attorney Benjamin Wagner said the losses to competitors caused by Salyer's determination to choke off competition were difficult to tabulate, but added, "I think it's safe to say it's in the millions."
Ten people already had entered guilty pleas to their roles in the unprecedented effort to subvert the market for a food staple, and federal prosecutors methodically and relentlessly used information from those prosecutions to pursue Salyer.
The case began with the conversion of Anthony Manuel, who had embezzled $1 million from his employer an SK Foods competitor before he went to work for Salyer's company. When agents confronted him about his thievery, Manuel made the best of a bad situation and, in a bid for leniency, agreed to walk out of SK Foods with loads of documents for the agents and to go about his work wired for sound so conversations with Salyer and others could be recorded.
In a pitched battle with prosecutors, Salyer's lawyers portrayed Manuel's work as the theft of SK Foods documents that should not be allowed as evidence against their client. They unsuccessfully sought to discredit the methods of the government's lead investigator, FBI Special Agent Paul Artley.
They lost those critical fights and succeeded in only one area: getting Salyer bailed out of the Sacramento County jail after about eight months in custody, where he complained that his diabetes was flaring and endangering his life, and his lawyers insisted it was impossible to get ready for trial in the cramped jail.
The government pointed at his bank account in Andorra and arrangements to move there as evidence he planned to flee.
But after friends and family put up homes and assets, he raised $6 million for bail and was placed under house arrest and electronic monitoring in his walled Pebble Beach mansion.
Despite the epic struggle over bail, Salyer was permitted to return home after Friday's guilty plea and await sentencing with no opposition from prosecutors. Sentencing is scheduled for July 10.
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