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Additional Charges for Scott Salyer
Superseding Indictment Adds Price Fixing and Bid Rigging Charges

U.S. Attorney’s Office April 29, 2010
  • Eastern District of California (916) 554-2700

SACRAMENTO, CA—A federal grand jury returned a 12-count superseding indictment charging Frederick Scott Salyer, 54, of Pebble Beach, with additional federal crimes for his participation in a conspiracy to suppress and eliminate competition in the tomato processing industry by raising and fixing prices and rigging bids, announced United States Attorney Benjamin B. Wagner and Assistant Attorney General for the Department of Justice’s Antitrust Division, Christine A. Varney.

This case is the product of a joint investigation by the Federal Bureau of Investigation, the Internal Revenue Service – Criminal Investigation, the FDA Office of Criminal Investigations, and the United States Department of Justice’s Antitrust Division.

The original indictment, which was returned by a federal grand jury on February 18, 2010, charged Salyer with violations of the Racketeer Influenced and Corrupt Organizations Act (RICO), in connection with his direction of various schemes to defraud SK Foods’ corporate customers through bribery and food misbranding and adulteration. The indictment also charged him with four counts of wire fraud, and one count of obstruction of justice.

The five new counts allege that Salyer conspired with others to fix prices or rig bids for the sale of processed tomato products to three of SK Foods’ domestic customers—McCain Foods, USA Inc., ConAgra Foods Inc., and Kraft Foods Inc.—and to include certain terms in contracts for the sale of processed tomato products, all in violation of the Sherman Antitrust Act.

The current charges against Salyer are the latest in the government’s investigation into various individuals and entities in the domestic tomato processing industry.

Between 1990 and 2008, Salyer was the owner and CEO of SK Foods L.P., a grower, processor, and nationwide distributor of tomato products and other food products. To date, 10 former executives and employees of SK Foods and its customer companies have pleaded guilty to one or more federal felonies in connection with the schemes.

Salyer is scheduled to appear before the Honorable Lawrence K. Karlton on May 4, 2010, for arraignment on the superseding indictment and a further status conference. He is in federal custody at the Sacramento County Main Jail.

The maximum statutory penalty on the racketeering charges against Salyer is 20 years in prison, a fine of up to $250,000 and the forfeiture of any interest, property or proceeds acquired or maintained as a result of the racketeering activity. The antitrust charges carry a penalty of up to 10 years in prison, and a fine of up to $1 million. The wire fraud and obstruction charges are punishable by up to 20 years in prison. The defendant’s actual sentence will be dictated by the Federal Sentencing Guidelines, however, which take into account a number of factors, and will be imposed at the discretion of the court. The charges against Salyer are only allegations and the defendant is presumed innocent until and unless proven guilty beyond a reasonable doubt.

Assistant United States Attorneys Sean C. Flynn and Matthew D. Segal are prosecuting the case with Barbara Nelson and Richard Cohen of the Antitrust Division’s San Francisco Field Office.

Press inquiries to the U.S. Attorney’s Office should be directed to Lauren Horwood at 916-554-2706. Press inquiries regarding the Department’s Antitrust Division should be directed to Gina Talamona at 202-514-2007.

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