US DA Unltad States Department of Agriculture Memorandum T0: Flle FROM: DATE: March 21, 2019 SUBJECT: Meeting with M1 LL LL nd follow-up On Tuesday, 5, 2019, Herple Ellis, Supervisor, and I met with Mr? at a Wendy?s restam ant located on East High Sheet, Jackson, Mississip i followin attendance at a meeting at the state capitol to discuss Farm Bill 1ssues. wor'klng 1n coo1dination with the Mississippi State Chapter 01: the meeting. ?ontact infor'mation 1s: ged the said 111111 he has attempted to get a connect to grow poulny since appioximately 2005. 11121 contacted 'lyson 1- oods (Carthage, MS), Peco Foods (Philadelphia, MS), and Koch Foods (Mo1toanoresl MS. I he Paco Foods complex was previously owned by Malshall Durbin. He was then employed by Ma1shall D111bi11 Marshall 1311111111 gave 111111 a letter ofinlent. A let eonsu anon W11 and receiving advice to not enter into the Marshall Durbin contract, he chose 11111 to -: 0 so. Since that time, however, he has continued to 1111; contract from Peeo, Tyson, and Koch. At l?eco, he has with Live Production Manager at the Philadelphia landmarmhas told him ceo 15 no aking on new growers. Agricultural Marketing Servlea. Fair Trade Practices Program. Packers and Stockyards Dlvlaion, Eastern Reglenal Office 76 Ted Turner Drive, S.W.. 311116 230 Atlanta, GA 30303 Volea 404-582-5840 Fax 404-562-6348 l-Iotllne 1-333-342-5113 amausdagev An Equal Opportunlty Provider and Employer 204 is United States Department of Agriculture Memorandum to File Koch Farms ol'Mississippi. LLC - Meeting wit I March 21.2019 Page Two l-iis calls to Tyson. since during or about 2005. have not resulted in his getting a poultry growing contract. He has called the Tyson Feed Mill and was referred to 'i'yson?s Live Production of?ce. As recently as two months ago, said that he called Tyson?s Live Production Of?ce and left a voice mail message, but never received a return call. .1- said that he has contacted Koch Foods by phone once or twice every year since during or about 2005, expressing his interest in getting a contract to grow poultry._said that Koch has denied his requests, stating that he is ?too far out," and that Koch was not taking on any new growers but was only adding houses on existing farms?was uncertain of the name of the individual(s) with whom he has spoken at Koch. stated that he may know ot?another minority individual who has tried to obtain a contract to grow poultr . He said that he would check with that person and provide me with his and I have tried to make telephone contact unsuccessfully. This an email asking for a time at which I could call him when he would be available. Earlier this week, i researched the distance of farms from the Koch feed mill in Morton, MS, that have poultry growing arrangements with Koch Foods. The only list of growers that I could ?nd that I previously obtained was from 2010. i have sent an email to Koch's legal counsel, Scott Pedigo, requesting a current list of broiler growers. During the sworn, recorded interview that I conducted in March 20l 3. of I asked about the range of distance of farms that Koch would contract with. tated from 43:00 43:35 (minutes) on the recording that Koch will contract out as far as 55 to 60 miles from the feed mill in Morton. He also said (at minutes) that Koch had three or four farms in the area of Peco's operation in the Philadelphia, MS, area. According to Google Maps, the fastest route between the Koch Feed Mill an property is 58.8 miles. Based on the 20IO list. i used Googie Maps to obtain mileage {Fastest route) from the Koch feed mill at 278 Herring Road, Morton, MS, to various farms that appear to be the farthest from the feed mill. There were seven farms located in excess of 60 miles from the feed mill, including some farms in the Philadelphia. MS, area. There were another 1 farms in excess of 50 miles from the feed mill. After receiving the current list of growers, I will calculate current distances to see if Koch has continued to contract with growers in excess ofSO miles from the feed mill. WH 8/ Agricultural Marketing Service. Fair Trade Practices Program. Padters and Stockyards Division. Eastern Regional Of?ce 76 Ted Turner Drive. S.W.. Suite 230 Atlanta, GA 30303 Voice 404-562-6840 Fax Hoillne: 1-833-342~5773 vow an}; manage); An Equal Opportunity Provider and Employer 205 United States Department of Agriculture Agricultural Marketing Service, Fair Trade Practices Program, Packers and Stockyards Division AFFIDAVIT FOR USE IN ANY PROCEEDING OR ACTION UNDER THE PACKERS AND STOCKYARDS ACT, 1921, AS AMENDED AND SUPPLEMENTED (7 U.S.C. 181 et seq.) STATE OF 4% [.55 55.5 SS: COUNTY OF BEFORE ME. an employee of the United States Department of Agriculture, designated by the Secretary of Agriculture under authority of the Act of January 31, 1925, 43 Stat. 803, 7 U.S.C. 2217, personally appeared (FIRM) (FIRM ADDRESS) who deposes and Says: Page 1 206 My name is I am over the age of 18 and I am fully mentally ti?) {is} ..- competent to make this statement under oath. I am an African-American. I have had an interest in building a poultry farm and obtaining a contract to grow broilers for a poultry company. Since 2005, Ii have contacted a number of poultry companies to seek a contract to grow poultry, including the following: 2 207 1. Koch Foods of Mississippi I have contacted Koch (Forest/Morton, Mississippi, location) once or twice a year since 2005, but was told by Koch representatives (whose names I do not know) that my property is located too far away, or that Koch is not taking on new growers, but is only adding houses on existing farms; 2. Tyson Foods I have contacted Tyson Foods (F crest/Carthage, Mississippi, location) and left messages for the Live Production Manager with no return call being made to me. My most recent attempt to contact Tyson about getting a poultry contract was during or about January 2019; and 3. Peco Foods I have contacted Peco Live Production Manager- Pliiladelphia, Mississippi, location) who has told me that Peco is not taking on any new growers; and 4. Marshall Durbin Farms (?Durbin?), which owned the complex now operated by Peco Foods in Philadelphia, Mississippi. I met with_ who was then employed by Durbin, and obtained a Letter of Intent to enter into a contract with me to grow poultry. After seeking the advice of my legal 3 - .208 however, and receiving advice to not enter into the contract with Durbin, I did not proceed with investing in poultry houses and signing a contract with Durbin. Although i chose to not enter into a contract with Durbin, have remained interested and willing to invest in building a poultry farm and entering into a poultry growin contract with Koch, Tyson, and Peco. The remainder of this page is intentionally blank, except For my initials. ?209 This statement consists of pages of which tis is page 5 . I have read the foregoing and it is true and correct. I give such statement freely and voluntarily, without threats or promises having been made, knowing that it may be used in the administration of the Packers and Stockyards Act, 1921, as amended, and the regulations thereunder. SUBSCRIBED AND SWORN TO before me at ?55,453an ,on this _2 4. Designated pursuant to the law to administer oaths. Authorization No. WITNESS: 210 UJUJN HDUD UNITED STATES DEPARTMENT OF AGRICULTURE Agricultural Marketing Service, Fair Trade Practices Program PACKERS AND STOCKYARDS DIVISION ECM CONTROL NUMBER: 283914 (Supplemental Investigation to ECM Number 223266) IN RE: KOCH FOODS OF MISSISSIPPI, LLC (Live Production Division, Forest, Mississippi) PARTIAL SUMMARY Interview of Koch Foods of Mississippi LLC February 7, 2013 . This 111te1v1ew was conducted 1) ., .- Investigative Atto1 ney, USDA Packers and Stockyards Plograrn. The inlet view was reco1ded using a digital audio 1',ecorder with the knowledge of all persons who were present. The recording, which consists of two parts, has been uploaded as an Exhibit in the ECM folder number 155432. The two-part recording of this interview has also been ?led in the ECM Folder for the initial investigation (Number 223266) with the names of: 'y i l-?worn Interview Part 1 of2 s?worn Interview Part 2 of2 Koch Foods of 02401 32:1] - . Koch Foods of Mississippi 02-201 - This partial summaly of the interview was prepared by -usin the recording of the inteiview (part 1 of 2), and using contemporaneous notes tha du1ing the interview. This partial summary is limited to the questioning 0 about the location of broiler growers? farms and the distances from the Koc 1 cc mill that Koch would contract with broiler growers Note that another partial summary concerning primarily matters of discrimination was prepared for the initial Investigation Report, and was included as Exhibit The recording of the interview can be used to create a verbatim transcript, if needed. 1 211 Location of Interview: U.S. Department of Agriculture, Natural Resources Conservation Service, 1099 Highway 35 South, Suite B, Forest, Mississippi 39074. The interview commenced at 10:37 am. -n 7, 2013. The persons present during the interview were - I Scott Pedi go (an attorney with Baker Donelson in Jackson, Mississippi, representing Koch Foods), James Hood (Resident Agent, USDA Packers and Stockyards Program), and 1:11 1111, 10 11 12 ?penned the interview by announcing that the recording device was turned 13 on and that the interview was on the record. -stated that the testimony was 14 being taken in the matter of Koch Foods involving an investigation undertaken 15 pursuant to federal law including the Packers and Stockyards Act, Packers and 16 Stockyards Program Regulation 201.94 (found at Title 9 C.F.R. Section 201.94), 17 and pursuant to Section 9 of the Federal Trade Commission Act, to determine 18 whether any person or entity has violated or may be violating any provision of the 19 Packers and Stockyards Act or any regulation or order issued there under. 20 ?noted for the record that his USDA Agent Badge Numbeind 21 credentials were exhibited on the table before him as evidence that he is authorized 22 to and in the proceeding-then called the l" L: i and administered an oath 11; to tell the ing but the truth, whicl-acknowledged. 25 I noted for the record, with the knowledge of all persons present, that the 26 testimony being taken was being recorded using a digital recording device. 27 stated that he understood that his statements were being recorded. 23 witness i .3 i if: 1? 24 truth, the whole truth, and not 28 asked whetheuas represented by an attorney during the interview. 29 nswered that he was not represented by counsel, and that he had no 30 o!Jecllo11 to Everett White, attorney for Koch Foods of Mississippi, being present 31 during the interview. 32 stated that the record would reflect tha as appearing voluntarily, 33 and acknowledged that fact. also said that the record would re?ect 34 that no threats or promises of any kind had been made secure his 2 212 1 testimony. acknowledged that fact. lso stated that no immunity of 2 any kind could he or was being offered to in connection with his testimony. 3 "acknowledged that fact, alsoOf?cer of Koch Foods. Kaminsky? supervisor is Joe Grendys, owner of Koch 22 Foods. 23 I I tated that he had not discussed his testimony with anyone in advance of the 24 interview. tated that he was not told about questions that have been asked of other Koch employees who have already been interviewed. 25 26 27 (Begin at 43:00 on the recording) ?was a former live poultry dealer that was purchased by Koch. 3 213 DON-ION rated that Koch contracts with poultry growers who are approximately 55 to 60 miles to the south and north, with a 110 to 120-mile radius around the feed mill, although ?Morton? is usually referred to as the starting point. He said that the new feed mill is located between Morton and Forest, and that Koch tries to stay within that radius in contracting with broiler growers. ?said that there are very few broiler farms to the East, with some located around Lake, Mississippi. To the west, Koch has some broiler farms as far as Pelahatehie. Beyond Pelahatchie, land becomes more valuable. There are some other poultry companies that contract with broiler growers in the same geographic area in which Koch contracts with growers, including: Peco Foods at Sebastopol (about 30 miles from Morton) to the north/northeast. There are Peco farms in Koch?s north broiler area. Peco Foods also has a complex at Bay . Springs, about 45 miles from Morton and it has growers under contract in Koch's south broiler area. A few Koch growers in the Philadelphia are in the area where Peco?s complex at Philadelphia contracts with growers. Tyson Foods in Carthage 214 goes out further in contracting with broiler growers than Koch does, in all directions. Wayne Farms at Laurel is at the very southern end and mixes in with some Koch growers. Sanderson Farms at Collins is at the southwestern end of where Koch contracts with growers. stated that he is not aware of any broiler growers that contract with Sanderson Farms at Hazlehurst who are in the area of growers who contract with Koch. There would be some growers who contract with Koch in the very southern end where some farms under contract with Sanderson Farms at Laurel are located. (1:01:20) ENDED 3:29 pm. (NOTE: Testimony regarding classes and numbers of broiler houses, contract terms, payment of broiler growers, plant capacity, other competition?related questions, density and numbers of birds placed, skimming (partial catching of ?ocks), early catching of birds, ?nance, shavings/sawdust, and gratuities from growers, questions about some other growers not related to the issue of discrimination, and och employee ownership of poultry farms, is not included in this partial 215 USDA - United States Department of Agriculture Memorandum TO: File FROM: DATE: March 21, 2019 SUBJECT: Meeting with On the morning of Wednesday, March 6, 2019 Tier le Ellis ER 0 1 ervis andImet at ?.111 the Huddle House in ?'11 issippi, witl arranging the meeting. menisci information is: stated that he previously grew poultry under a contract will?at its 13, location. His farm consisted of eight brmler houses: Four houses were built in 1998; Four houses were new; All eight houses measured 500? 44' Al] houses had tunnel ventilation, cool cells, and were rated ?Class by Sanderson. ?stated thatmterminated his contract during or about 2015 (probably late 3i ?i . - ledge, he was the only A?ican- American grower who had a contract with the - At the annual gr?owers meetings he attended, he was the only Alrican- American g1 ower in attendance. I reported that he was rmance pr rm with higher than ciagc sad and chick costs. A inanagei, (spelling?) ?ng with him about selling his farm to a person who' is Vietnamese- Ame-1 iean. lie tul that he was not interested in selling his faiin. in the ensuing {locks ofbiids that were deliveied to his farm different Seivice Technicians each with different requirements, were assi Inerl to his farm. One Service Technician, for example, had some requirements for feeders thahcansidm ed to be strange. He stated that the Agricultural Marketing Service. Fair Trade Practices Program. Packers and Stockyards Division. Eastern Regional Office 75 Ted Turner Drive. S.W.. Suite 230 Atlanta. GA 30303 Voice 404-562'5840 Fax 404-562-5848 Hoillna: 1-833-342-6773 An Equal Opportunity Provider and Employer 317 us DA United States Department of Agriwiture Memorandum to File Koch Forms of Mississippi, LLC - Meeting with? March 21. 2019 Page Two Service Technicians frequently changed the controls in his houses. During this time, he lost half oi the chickens in one of his houses due to a fan that stopped working. his poultry houses at one point got washed out due to heavy rain; repair. titted that he was unable to make the repairs due to the heavy rain. nonetheless wrote a ?de?ciency" against him for the damage Anolhe-ruwer located across the road from where his far ome over to his farm to tri to help him improve performance. owever, told hat he had to stay ofTo 'arln. ?lerminated his contract after approx' tield on his properly. The birds were found to go onto that part of his property called the Mississippi Department of Quality. which came to is property and cited him for violating environmental laws. said that he did not put the dead birds to the ?eld, and that he had told the eight men wnt? tag or him on his farm to put dead birds in the composler. Also. there were other poultry farms in the immediate area from which the dead birds could have come. ditli) dead chickens were found in a ersonncl. who did nor have authority After Jouitr that was on his t'arm the last Flock) was cough tated that he was told by the ?crvice Te a ?l prepare his eight houses to receive a new ?ock etc-hicks. to prepare is 'i houses. aid that ht: had to treat the litter with PLT, obtain propane gas. the.? however. iroug tl him a termination letter about two week later, and he did not receive any I?urthor ?ocks during the Lill-day termination notice period or otherwise. ?stated that there was a while hroiler rower who allegedly did the same thing (alleged improper disposal of dead birds huddllowed him to keep his contract and did not terminate the contract did not know the name oi?the white grower "ad 1 discussed the Myers v. Sanderson Farms case that. involved the termination of a inn or production a on an environmental violation and was litigated in federal court in hdlississipi'll asked that I send him information about the Myers case. (in that case. the federal court to tta Mississippi law required Sanderson to continue placing birds on the Myers farm during the 9ti-da notice ot?terminalion period. said that he was aware ot?one white who is suin ctutcstett that the Packers and Stocltyurrl Division investigate his termination hr and suspects that he may have suffered metal discrimination in having his Agricultural Marketing Seance, Fair Trade Practices Program, Packers and Stockyards Division, Eastern Regional Of?ce 75 Ted Turner Drive 5 W.. Suite 230 Atlanta. GA 30303 Voice wit-5626840 Fax 404-562-5848 Holiine; 1-833-342-6773 momsusdaggv An Equal Opportunity Provider and Employer 31B USDA - United States Department of Agriculture Memorandum to File Koch Farms of Mississippi, LLC Meeting with? March 21, 2019 Page Three contract terminated when a white grower allegedly engaging in the same practice ltent his contract. Following the termination of his contract -.- .. said that he tried to obtain a broiler gIowing contract with other companies as 'o A. Wayne Farms ?selnt atcnresunative to his farm to look, but may have spoken with someone 'a -- - and backed out and did not offer him a contract; B. Pcco - said it was not taking growers in his area; and C. Koch Foods he spoke over the phone with one person (name not known). The Koch representative told him that Koch was taking on growers and that someone would come to his farm and look at his poultry houses. No one from Koch showed up, so he called Koch again and was told that Koch was contracting on some new houses but may need some existing houses, as well. The Koch representative again told him that someone would come out to his farm and look at it, but no one ever showed up. stated that he knew anothcl Illil?ltli' ity individual who had tried to obtain a poultry gIriwIng connect. it said that he would check with that [lemon and get hack with me. (See Nut .6 ?in a. Agricultural Marketing Service. Fair Trade Practices Program, Packers and Stockyards Division. Eastern Regional Of?ce 75 Ted Turner Drive. SW. Suite 230 Atlanta. GA 30303 Voice 404-562-5340 Fax 404-562-6848 Hotline: 1-833-342-5773 ems usciaggy An Equal Opportunity Provider and Employer 319 United States Department of Agriculture Agricultural Marketing Service, Fair Trade Practices Program, Packers and Stockyards Division AFFIDAVIT FOR USE IN ANY PROCEEDIN OR ACTION UNDER THE PACKERS AND STOCKYARDS ACT, 1921, AS AMENDED AND SUPPLEMENTED (7 U.S.C. 181 et seq.) STATE OF 54 (5551551453131 SS: COUNTY OF Am 0 i BEFORE ME, JAMLHREMQIQB an employee of the United States Department of Agriculture, designated by the Secretary of Agriculture under authority of the Act of January 31, 1925, 43 Stat. 803, 7 U.S.C. 2217, personally appeared (FIRM) (FIRM ADDRESS) who deposcs and says: Page] 320 I am over the age of 18 years, and I am fully mentally My name is ran an. ref: vi": competent to make this statement under oath. I am an African-American. I previously grew poultry under a contract witl_ Mississippi, location. My farm consisted of eight broiler houses: Four houses were built in 1998?; Four houses were new; All eight houses measured 500? 44? All houses had tunnel ventilation, cool cells, and were rated ?Class by. Sanderson. To my knowledge, I was the only African-American grower who had a - complex. At the annual growers? meetings I attended, I was the only African-American grower in attendance. 321 I experienced some performance problems on my farm with higher than average feed and chick costs. began talking with me about selling my farm to a Vietnamese-American. I told different Service Technicians, each with different requirements, were assigned to my farm. One Service Technician, for example, had some requirements for feeders that I considered to be strange. The Service Technicians frequently changed the controls in my houses. During this time, half of the chickens in one of my houses died due to a fan that stopped working. The road to my poultry houses at one point got washed out and needed repair, but that I was unable to make the repairs due to heavy rain.- ged road. nonetheless put-me on probation-for the dama 322 terminated my poultry growing contract during or about late 2015 after approximately 300-400 dead chickens were found in week running on my preperty. The birds were foundbmersonnel, who called the Mississippi Department of Environmental Quality DEQ came to my property and cited me for violating environmental laws. However, I used an (approved) composter for disposing of dead chickens, and I denied putting the dead ml A birds in thcereek. I had also ordered the two men working for me on my farm to put dead birds in the composter. Also, there were other poultry farms in the +013 5?5 1w? I 92mm Gal After poultry that was on my farm (the last Flock) was caught, 1 prepared my immediate area from which the dead birds could have come. out eight houses with PLT (a litter treatment), obtainesd pro ane gas, and otherwdprepared my houses to receive new brought me a 323 . .- termination letter iand I did not receive any further ?ocks during the 90-day- termination notice period or thereafter. It is my understanding that there was a white broiler grower who allegedly did the same thing (putting dead birds in a creek), butuallowed him to keep his contract and did not terminate its contract with him. Following the termination of my contract b)_I tried to obtain a broiler growing contract with other companies, as follows: 1. Wayne Farms Wayne Farms sent a representative to my farm to look at my poultry houses. I suspect that the Wayne Farms representative may Farms. Wayne Farms did not offer me a have Spoken with someone a contract; 2. Peco Foods said it was not taking growers in the area where my farm was located; and 324 Koch Foods of Mississippi I spoke over the phone with one person (name not known). The Koch representative told me that Koch was taking on - growers and that someone would come to my farm and look at my poultry houses. No one from Koch showed up, so I called Koch again and was told that Koch was contracting on some new houses but may need some existing houses, as well. The Koch representative again told me that someone would come out to my farm and look at it, but no one ever showed up. Due to ?nancial requirements, I had to proceed with selling my farm and could not wait longer to try to get a contract with another poultry company. Although I was able to sell my farm, the sales price that I obtained left me with approximately $100,000 in debt, on which I continue to make payments. 1 (3 men. w?l??a?mf?ama?g seek/.10 chfagam?im. as as (my/Ly Monet skim Mb??sde? PM 11,7 MID grim-row. 7%ng glint-AM .a?wQ/La?mm . ?My??bmmp. This statement consists of pages of which tis is page I . I have read the foregoing and it is true and correct. I give such statement freely and voluntarily, without threats or promises having been made, knowing that it may be used in the administration of. the Packers and Stockyards Act, 192] as amended, and the regulations thereunder. SUBSCRIBED AND SWORN TO before me at -?Il . Designated pursuant to the aw to administer oaths. Authorization No. - WITNESS: