In 1993 and 1994, Tyson Foods was the world's largest fully integrated producer, processor and marketer of poultry-based food products. Its market share of chicken products sold in the United States was approximately 23%. It also had a smaller beef and pork division. The company's integrated operations included breeding and rearing chickens and hogs, harvesting seafood, and processing and marketing poultry, beef, pork and seafood. The company processed approximately 3.9 billion pounds of consumer poultry and 518 million pounds of consumer beef and pork during fiscal 1994. Tyson Foods' annual sales in 1993 and 1994 were approximately $5 billion, with beef and pork operations accounting for approximately 10% of its business.Tyson Foods in 1993 and 1994 owned and operated approximately 60 poultry processing plants, 18 of which also processed beef and pork products, in 17 states and three foreign countries. USDA inspected all of Tyson Foods' slaughtering and processing facilities and pervasively regulated their operations. The company noted in its annual 10-K report for 1994:
The Company's poultry, beef, pork and Mexican food-based processing facilities are . . . subject to extensive inspection and regulation by the United States Department of Agriculture.As Tyson Foods' main lines of business were food processing and distribution, it had an obvious reason to maintain Espy's receptive ear. The company was subject to extensive USDA regulation in its everyday operations. Tyson Foods routinely had numerous matters pending before USDA - matters that could and did substantially affect the company's operations. During Espy's tenure as Secretary of Agriculture, pending USDA policy issues had the potential to affect more than $100 million of Tyson Foods' business.
Don Tyson, chairman of the Board of Directors, owned or controlled approximately 90% of the voting shares of the company. Don Tyson was a friend of and political contributor to Bill Clinton when he was Governor of Arkansas and when he ran for the presidency of the United States. Don Tyson's son, John H. Tyson, was president of the Beef and Pork Division and a director of Tyson Foods in 1993.
Archibald R. Schaffer III was Tyson Foods' director of Media, Public and Governmental Affairs. In this capacity, Schaffer acted as the company's principal spokesperson and was responsible for overseeing all of Tyson Foods' dealings with and lobbying of government officials, supervising all contacts with the press and administering all public-relations efforts. His duties included reviewing official comments that Tyson Foods' technical department submitted to government agencies regarding proposed legislation and regulations. He was also the primary contact between Tyson Foods and two trade associations to which it belonged, the National Broiler Council and the Arkansas Poultry Federation. Schaffer reported directly to John Tyson and supervised Tyson Foods' Washington, D.C. lobbyist, Jack Williams. Don Tyson testified that he expected Schaffer and his predecessor to advise him on the legalities of his dealings with government officials, and in this respect Schaffer had let him down.
Jack L. Williams, a registered lobbyist, represented Tyson Foods' interests before various governmental agencies, including USDA. Williams reported to Don Tyson, John Tyson and Schaffer. He submitted monthly invoices for "Legislative Liaison Services" to Tyson Foods, including a flat fee for services rendered and a non-itemized amount for "additional Washington expenses" that varied from month to month and that Schaffer reviewed and approved. Williams also represented other clients before USDA.
The National Broiler Council (NBC), a trade association for the poultry industry, described itself as "representing the producers/processors of 95% of the broiler chickens consumed in the United States." Its purpose was to promote poultry products and maintain a legislative liaison presence with regulatory authorities and Congress. The $165,000 in annual dues paid by Tyson Foods, nearly twice those of the next-largest member, comprised 8% of the NBC's annual budget, making Tyson Foods the trade association's largest and dominant member.
The Arkansas Poultry Federation (APF) was a trade association that represented the interests of the poultry industry in Arkansas before federal, state and local government entities. Its membership consisted of poultry processors, feed manufacturers, commercial egg producers and others. Each member company paid up to a maximum $15,000 in annual dues; in each of 1993 and 1994, Tyson Foods, the largest dues-paying member, paid $45,000 reflecting the three companies it controlled.
The Tyson Foundation, Inc., an entity separate from Tyson Foods, was formed in 1969 as a not-for-profit Arkansas charitable corporation funded with Tyson Foods stock. It was organized, in part, to provide college scholarships to needy students who resided in the vicinity of Tyson Foods' operating facilities. As the Tyson Foundation stock increased in value, the foundation developed into a significant charitable education enterprise, with assets in 1995 valued in excess of $15 million.
After the 1992 presidential election, Mississippi Congressman Espy approached John Rogers, president of C.B. Rogers, Inc., a large Mississippi poultry company, seeking an introduction to Don Tyson. Espy was interested in being nominated as Secretary of Agriculture or Commerce in the Clinton administration. Because of his position as chairman of one of the world's largest poultry companies and his reputed relationship with the President-elect, Don Tyson appeared to be in an advantageous position to influence the new administration's selection of the Agriculture Secretary. Rogers agreed to arrange the meeting. Shortly thereafter, Espy, Ronald Blackley (Espy's Congressional district agricultural representative and future Chief of Staff), Rogers, and Rogers's wife flew in Rogers's private plane from Mississippi to Little Rock, Arkansas to meet with Don Tyson.
John Tyson met the group at the airport in Arkansas. Espy, Blackley, Rogers and John Tyson then traveled to Little Rock for lunch, where Don Tyson joined them. During lunch, Rogers told Don Tyson that Espy wanted to be a Cabinet member and urged him to use his influence with the President-elect to assure that Espy be considered. Espy then informed Don Tyson of his qualifications for the post and solicited his assistance.
After he became Secretary of Agriculture, Espy occasionally met Don and John Tyson, primarily at social gatherings and events, and the Tysons made use of such occasions to lobby Espy on matters of interest. Espy's most frequent contact with Tyson Foods, however, came through lobbyist Williams, with whom he frequently met to discuss policy matters affecting Tyson Foods. Espy's calendar reflects that he met with Williams on at least the five following scheduled dates: February 3, 1993; March 11, 1993; January 25, 1994; February 16, 1994; and March 9, 1994. Williams also was known to show up unannounced on other occasions to meet with the Secretary. Espy's notepads reveal either a meeting or a telephone conversation with Williams on September 14, 1993, at which time the topic of attending a Dallas football game came up. Espy also met with Tyson Foods' governmental affairs director Schaffer from time to time.