Jayson Penn Indicted By Federal Grand Jury In Denver; Feds Find A Chicken Conspiracy At Greeley-Based Firm
by Glen Richardson
A federal grand jury in Denver has indicted Jayson Penn, the CEO of Greeley-based Pilgrim’s Pride, and three other current or former chicken industry executives for price fixing. The grand jury in U.S. District Court here indicted all four with one count of conspiring to fix prices for broiler chickens from at least 2012 through 2017. A trial is scheduled to begin this month (August).
Scratching Out A Living: Headquarters of the second-largest U.S. chicken company Pilgrim’s Pride is in Greeley. The entrance includes a bust of founder Lonnie “Bo” Pilgrim. The firm reported annual revenue last year (2019) of $11.41 billion.
The indictments came after grocers, retailers and consumers accused Pilgrim’s Pride, Tyson Foods Inc., and other poultry processors in a lawsuit of conspiring since 2008 to inflate prices for broiler chickens. Fabio Sandrio, chief financial officer, is serving as interim president and CEO.
The other executives allegedly involved in the scheme include former Pilgrim’s Pride vice president Roger Austin, Claxton Poultry Farms President Mikell Fries, and Scott Brady, a former Pilgrim’s Price executive who joined Claxton in 2012. Pilgrim’s Pride supplies chicken for Costco and Yum Brands’ KFC, while Claxton is a supplier for Chick-fil-A.
$11.4 Billion Income
Pilgrim’s Pride is the second-largest U.S. chicken company, with reported annual revenue last year (2019) of $11.41 billion. It is majority-owned by Brazilian meat giant JBS. Tyson Foods Inc. — the largest U.S. poultry processor by sales — meanwhile says it is cooperating in the Justice Department’s probe into the matter, under a leniency program that will let Tyson avoid criminal prosecution.
Penn pleaded not guilty to the federal charges, while a judge barred him from contacting poultry buyers allegedly victimized by the scheme. He also agreed to surrender his passport and not leave the country.
U.S. Magistrate Judge Kristen Mix said at the hearing that Mr. Penn can remain free on personal recognizance, and can travel. She imposed conditions on his actions while he awaits trial, most notably that he can’t contact employees of eight companies that are customers of Pilgrim’s and are alleged victims of price-fixing by Mr. Penn and co-conspirators. The Judge also said Mr. Penn couldn’t contact price negotiators at other chicken suppliers who allegedly participated in the price fixing.
Penn On Paid Leave
Jayson Penn joined Pilgrim’s in March of 2011 as Senior Vice President of the Commercial Business Group. He moved up to President of Pilgrim’s USA in 2017 and was promoted to President-CEO in March of 2019.
Indicted CEO: Jayson Penn, the CEO of Greeley-based Pilgrim’s Pride, has been placed on paid leave following pleading not guilty to the federal charge.
Pilgrim’s Board placed Penn on leave with pay following the hearing. He makes $4,418,340 as President-CEO at Pilgrim’s Pride.
“The Board takes the recent allegations very seriously and believes it is in the best interest of both Jayson and the company that he is given the opportunity to focus on his legal defense at this time,” Board Chairman Gilberto Tomazoni said in a statement.
Ruffled Feathers
“After years of talk, the feds finally pounced,” observe legal experts familiar with how the Department of Justice executes prosecutions of business organizations. They say it is one of the stranger examples of alleged market-rigging in a long history of cases, made more unusual in that the chief executive of a company that big is actually facing criminal charges and as many as 10 years in prison. The maximum fine may be increased to twice the gain derived from the crime or twice the loss suffered by victims if either amount is greater than $1 million, according to the Department of Justice.
Chicken House Pride: Founder Bo Pilgrim, at right, performed in ads dressed in pilgrim garb with a pet chicken named “Henrietta.” His Texas mansion was nicknamed “Cluckingham Palace” by neighbors. He sold the company to JBS in 2009 and it was moved to Greeley.
The charges the U.S. Justice Department laid out in its indictment appear to document executives at competing companies colluding to share pricing and bidding information from 2012 through 2017 in the cut-throat world of commodity chicken. Makan Delrahim, the head of the government’s antitrust division, said in a statement: “Executives who cheat American consumers, restaurateurs, and grocers, and compromise the integrity of our food supply, will be held responsible for their actions.”
Vertically integrated, Pilgrim’s Pride is involved in breeding, hatching, raising, processing and distributing chicken. The company produces some 11 billion pounds of chicken products annually and serves more than 6,000 retail food outlets, distributors and food service operators.
Chicken Feed Start
Pilgrim’s Pride traces its roots to Pittsburg, Texas, where Lonnie Alfred “Bo” Pilgrim opened a chicken feed store in 1946 with his older brother, Aubrey. They grew the fledgling company by handing out free chicks along with purchased bags of feed sold to customers.
Bo Pilgrim would often dress in pilgrim garb, complete with a pet chicken named “Henrietta,” to perform in advertisements. The extravagant Texas mansion where he lived was dubbed “Cluckingham Palace.” Set on 43 acres, it had 10 bathrooms, an indoor pool, cinema and gymnasium.
He sold the international poultry operation to Brazilian company JBS in 2009, and its headquarters was moved to Greeley. He died in 2017 at age 89.
“I am still making order out of chaos by reinvention.”
— John le Carre
by Luke Schmaltz
Jeff Bezos’ Amazon has prospered greatly from the Covid-19 shutdown along with McDonald’s, Walmart, Target, and many other wealthy Fortune 500 corporations.. Conversely, many of the most unfortunate economic casualties of the Covid-19 shutdown are small businesses — a staggering percentage of which will not recover. Among these, many of the hardest hit are family-owned food and beverage establishments and independent retailers.
Currently, the nation’s financial spine appears to be either broken or at the very least severely out of alignment. Unfortunately, the middle class can’t just go hobbling down to the economic chiropractor and get its mangled column of vertebrae snapped back into place. Rather, the health of each small yet crucial section is going to have to be nurtured back to solvency one joint at a time.
Jeff Bezos
A Personality Crisis
Doing this is going to require innovation, experimentation, and the willingness to abandon some elements of the old fiscal paradigm. The Washington Post recently reported that over 100,000 small businesses have closed down permanently due to the Coronavirus fallout, and more are expected. This year’s decimation of small business has created a massive void in the marketplace as a whole. The character and warmth of family-owned and operated businesses that are no longer there has left consumers with an ever-dwindling set of bland, prefabricated cookie-cutter options. As most folks with even a fraction of personality will agree — that will not do.
The independent entrepreneurial spirit is strong in many Americans, and some would rather work for themselves 80 hours a week than clock in and out of a regular job and toe the line to the corporate status quo. Independent mom and pop businesses can and will etch their place in the economic landscape once again. If you are willing to step out onto shaky ground, there are a few takeaways from the current crisis you can arm yourself with so that the next stay-at-home order will not mean curtains for your piece of the American Dream.
Brass Tacks Of Business
Boarded Up: Bracing boards on windows does not brace the backbone of the economy.
Retail shops and dine-in restaurants carry the always present, ever-increasing burdens of rent, insurance, property tax, loan payments, utility bills and on and on. Before dollar one can be considered profit, these costs must be met. If your passion is preparing delicious food or supplying people with items they need, consider operating from modest digs for starters or better yet, skip the storefront altogether and set up shop from home. Rather than wait for random foot traffic to wander through the door, you might consider marketing to your immediate community and perhaps to an extended clientele within reasonable, deliverable radius. Plus, if your business is non-perishable goods, there’s always the good ol’ United States Postal Service.
Interact With Your Neighbors
Neighbors: Communities are built on relationships between neighbors.
By creating commerce and delivering value to your community, you are playing an important role in bolstering your small section of the backbone. In this scenario, your neighbors and fellow Denverites are your clientele, and developing relationships with them is crucial to your success. For this to happen, however, there must be a general consensus that fast food and big box stores are not the only options when it comes to enjoying professionally prepared meals and purchasing clothes, accessories and gifts. With the unfortunate dwindling of mom and pop places to frequent, people are eventually going to get sick of unhealthy fast food, generic products and soulless interaction. This newly-emerging niche is where small, home-based and low-overhead businesses owners can step in and make a living — and perhaps a difference in their community.
Reach Out In Old And New Ways
Spread the word about your products and services by talking to people in your immediate community. If the quality you present is on par with your passion for your business — those you serve will almost certainly tell their family, friends and neighbors about you. Also, the internet, despite its flaws, is still a powerful tool for doing business — perhaps now more than ever. You can cheaply and effectively build and maintain a clientele via internet marketing — specifically by email. You will need a basic website, an on-page email capture feature and an email management service. All can be acquired and maintained for a few dollars a month. The scope of this article is not broad enough to go into all of the nuts and bolts of this, but please know that for the curious, there are volumes of free information available about every facet of online marketing.
Subvert The Supply Chain
Locally sourcing raw materials is an essential component of a community-focused, small business resurgence. Large agricultural distributors are in the same category as fast food chains and corporate retailers. They are only concerned with numbers and have no contingency in their business plans for building and sustaining communities. On the other hand, according to farm flavor.com, there are 36,180 farms and 156 farmers markets in the state of Colorado. Plus, delivery services such as Grub Hub, Door Dash and Uber Eats are available to deliver just about anything edible you may produce to your local customers. As the locally-sourced, delivered inventory model grows, so too will regional services designed to meet that demand. Currently, Coloradofreshproduce.com and Farmtoforkcolorado.com are serving the entire Denver metro area and surrounding suburbs.
While some of what is presented here is speculative, the fundamentals of what make small businesses volatile are definite: high overhead, a disconnect with the community and outdated marketing strategies. What makes them invaluable, however, is that they are run by human beings who share the same aspirations, concerns and neighborhood as you.
The Gaylord Rockies Resort & Convention Center reopened for reservations on June 25, 2020, after being closed due to the Covid-19 pandemic. Staff members, wearing masks and having been retrained for enhanced cleaning technologies, were eager to greet guests as they checked in for the first time in months.
Outdoor Pool: The Arapahoe Springs pool now requires reservations. Each guest can choose between an 8 a.m. to 2 p.m. or 3 p.m. to 9 p.m. slot for each night of their stay. A limited number of guests are allowed in for each time slot.
The reopening comes with limited capacity and strict social distancing measures. The resort has set up directional arrows for walking throughout the resort, hand sanitizing stations throughout, and limited restaurant availability. The Mountain Pass Sports Bar, which features a 75-foot viewing screen, the largest in the state, is the only restaurant open. In addition, the Arapahoe Springs Bar & Grill near the pool, Rockies Marketplace, and the taco bar near the Pinyons bar are other options. The Pinyons bar now forms a single file line to order drinks which allows for social distancing. For the time being, the other restaurants are closed. However, the resort does allow outside food to be brought in. Convenient options are services such as Uber Eats or GrubHub.
The Arapahoe Springs pool area is now under a reservation only system. Guests can choose either an 8 a.m. to 2 p.m. or 3 p.m. to 9 p.m. slot. The pool closes from 2 p.m. to 3 p.m. every day for enhanced cleaning measures. These reservations allow staff to monitor how many people are in the pool for each time slot and limit the number of guests there at once. For guests with younger kids, it is recommended to reserve the 8 a.m. to 2 p.m. shift as the pools and lazy river are less crowded during that time slot.
The pools are definitely the resort’s main attraction. There is an indoor and outdoor pool (which includes an infinity pool), an outdoor lazy river, and three water slides. This water park is spread out over 22,000 square-feet which allows for proper social distancing. The entire resort is situated on 85 acres of land, so it never feels crowded even under normal circumstances. Guests can reserve a cabana if they want their own dedicated space. Or they may snag a chair by the lazy river and relax.
Every night at 9 p.m., the resort plays a kid-friendly movie on the lawn with plenty of room for families to spread out. They also have games such as bingo on the lawn. The activities are less than usual but it is still a nice getaway if families feel the need to get away for a couple of days yet are not ready to jump on an airplane.
Gaylord Rockies is near Denver International Airport and is a Marriott property that opened in December 2018. The 486,000 square feet of convention space makes it the largest combined resort and convention center in Colorado. It is the fifth Gaylord property to open with the others located in Washington, D.C, Nashville, Orlando, and Dallas.
The Gaylord Rockies Resort & Convention Center is located at 6700 North Gaylord Rockies Boulevard. For more information about the resort or to make a reservation, visit www.gaylordrockies.com.
In the midst of restaurants and breweries trying to reopen and stay open during the Covid-19 pandemic, a popular local brewery has plans to expand by adding a third location. Thriving and not just surviving, Denver Beer Co. (DBC) is opening a third metro area brewery and taproom slated to open in late fall of 2020.
Aerial View: Rendering of aerial view of the new Denver Beer Co. South Downing Street location slated to open later this Fall. Images provided by: Denver Beer Co.
The newest addition to the DBC family comes to 2425 South Downing Street, near the Rosedale and University neighborhoods. The owners, Charlie Berger and Patrick Crawford, purchased the south Downing Street property back in December 2019, after a long look for new real estate for their newest endeavor. Despite a few setbacks (not because of COVID-19, according to Crawford) they have steadfast plans to open their doors late this fall.
The purchase of the South Downing Street location, originally a gas station and most recently Maddie’s Restaurant, was well received in the area. The closing of Maddie’s was a shock to those in the neighborhood, and with locals anxious to fill the abandoned space, the opening of the new DBC came at an opportune time.
Plus, the recent announcement of the closure of nearby brewer, Declaration Brewing, who filed for Chapter 11 bankruptcy earlier this year, the news of DBC’s third metro location has given the neighborhood something to toast to. Despite those businesses that have come and gone, DBC joins good company with others still standing in the area such as The Roaming Buffalo, John Holly’s Asian Bistro, Little India, and the SoDo Village Market.
Sprawling Space: Rendering of the lawn space at the DBC South Downing Street location. This space is 10,000 square feet and features a beer garden, tiered decks, bike parking, a tiki bar, an outdoor game area, firepits, and a shady lounge area underneath the trees.
The renovation will include two separate buildings surrounding a communal patio and garden. The small taproom will be housed in the larger 2,563-square-foot building, that will include a tasting room, seating 60 to 70 people. Aside from the beer, the biggest attraction will be the 10,000-square-foot patio in front of the main building. The outdoor space will feature a beer garden, tiered decks, bike parking, a tiki bar, an outdoor game area, firepits, and a shady lounge area underneath the trees.
Be sure to come hungry as well as thirsty as they plan to offer food in a similar set up to their Arvada location with The Mighty Burger, a vintage airstream food truck serving gourmet burgers and fries. The adjacent, smaller 761-square-foot building is planned for an additional restaurant partner, that is yet to be determined.
“We hope this new taproom will become a community gathering place and hub for the surrounding south Denver neighborhoods including Platt Park, South Wash Park, DU area, and Harvard Gulch areas,” stated Crawford, co-founder for Denver Beer Co.
Like their other taprooms, they will offer a similar menu concept of rotating seasonal beers with their flagship brews including Princess Yum Yum and the Incredible Pedal IPA, plus several specialty brews specifically for the Downing Street location.
Plans are in place to adhere to all social distancing guidelines with groups of no more than eight people allowed, and tables outside will be kept six feet apart.
For more information and updates on the Denver Beer Co. Downing Street location visit denverbeerco.com/downingst or follow them on social media @DenverBeerCo.
