Two tearful ex-Bumble Bee Foods executives who pled guilty to price-fixing avoided prison Wednesday when a California federal judge sentenced them to probation, finding that while they worked with rivals at StarKist and Chicken of the Sea to illegally raise canned tuna prices, they also helped put their ex-boss behind bars.
U.S. District Judge Edward Chen sentenced former Bumble Bee senior vice presidents — and cooperating government witnesses — Kenneth Worsham and Walter Scott Cameron each to community service, three years of probation and a $25,000 fine, handing down the sentences over a year after a California federal jury found former Bumble Bee chief executive officer and president Chris Lischewski guilty of price-fixing.
Judge Chen said that while both Worsham and Cameron had made the poor decision to participate in an industrywide price-fixing scheme, they both cooperated fully with the government’s investigation and had testified against Lischewski at trial.
Lischewski, who maintains his innocence, is serving a 40-month prison sentence.
In separate sentencing hearings Wednesday, Worsham and Cameron both expressed shame and remorse for their actions. While the pair each faced between 10 and 16 months in prison, the government recommended a downward departure with no prison time as a benefit for cooperating with a yearslong government investigation.
Appearing in the courtroom masked and sobbing, Cameron said he’s ashamed of his conduct and apologized to Bumble Bee consumers for the harm he had caused them.
“Everything that I did good or bad, right or wrong, was because of me. My thoughts, my actions, my beliefs created this situation. Any lack in my life is because of me,” Cameron said through tears.
“I wish I could go back and change the beginning of this story. I can’t,” Cameron said. He told the judge that since this chapter in his life began he has committed to being honest.
Worsham, likewise sobbing and masked, told the judge that the penalties he has suffered over the last six years as a result of his criminal offense have been “devastating.” He said he lost his job, his friends and respect.
He said he regrets having listened to his former boss when he instructed him “to do things that it wasn’t OK to do.”
The alleged price-fixing scheme came to light shortly after Thai Union Group — the owner of Chicken of the Sea — announced its plans in 2014 to acquire Bumble Bee Foods LLC for $1.5 billion.
But the acquisition never happened.
The government’s routine antitrust review of the acquisition led to a subsequent U.S. Department of Justice investigation into the packaged seafood industry. The price-fixing scheme became public in 2015 when Thai Union disclosed the DOJ investigation.
Both Worsham and Cameron pled guilty to price-fixing in 2016, with StarKist’s former senior vice president of sales Stephen Hodge pleading guilty the following year.
In 2018, a federal grand jury indicted Lischewski, who served as CEO and president of Bumble Bee for nearly two decades.
Bumble Bee and StarKist have both pled guilty to conspiring to fix prices and Chicken of the Sea admitted wrongdoing and cooperated with the government’s investigation. The government fined StarKist $100 million and Bumble Bee $25 million.
Lischewski’s 2019 trial included witness testimony from former executives at Bumble Bee, StarKist and Chicken of the Sea, including those who admitted to participating in the price-fixing conspiracy.
Lischewski also testified and conceded that he “occasionally” received non-public information from competitors and “may have” asked his employees to gather it.
Bumble Bee Foods, owned by Lion Capital Americas Inc., a subsidiary of U.K.-based private equity firm Lion Capital LLP, filed for bankruptcy roughly two weeks into the trial. Bumble Bee’s top supplier of tuna, Taiwan-based FCF Co. Ltd., reached a deal to buy the company for $925 million, just shy of the $980 million Lion Capital purchased the company for in 2010.
On Wednesday, Judge Chen underscored the seriousness of Worsham and Cameron’s offenses, saying that they both took part in premeditated criminal activities over a number of years and that it wasn’t a victimless crime.
“This offense was consequential, was widespread and it hurt people who were economically in a vulnerable position, ’cause that’s who the typical consumers are of the packaged tuna,” Judge Chen said. This was a deliberate offense that occurred over many transactions and not just an instance of giving into a moment of weakness, the judge said.
Judge Chen said Worsham “knew better, but he didn’t draw the line and went along with it, unfortunately.”
“Bumble Bee appears to have been the initiator of the conspiracy and Mr. Cameron was in a high enough position that he could have resisted, should have resisted, but neither he nor Mr. Worsham did,” Judge Chen said.
Counsel for the government said it’s important that those who decided to cooperate early in a government investigation receive a benefit.
Judge Chen agreed, sentencing Worsham to three years of probation, six months of curfew, 75 hours of community service and a $25,000 fine. The judge sentenced Cameron to three years probation, 120 hours of community service, home detention and a $25,000 fine.
The government declined a request for comment and counsel for the defendants did not immediately respond to requests for comment Wednesday.
The government is represented by Manish Kumar, Mikal Condon and Leslie Wulff of the U.S. Department of Justice’s Antitrust Division.
Worhsam is represented by Jeff Rutherford of Kendall Brill & Kelly LLP.
Cameron is represented by Thomas Calcagni and Walter Krzastek of Calcagni & Kanefsky LLP.
The cases are USA v. Worsham, case number 3:16-cr-00535, and U.S. v. Cameron, case number 3:16-cr-00501, in the U.S. District Court for the Northern District of California.
Edited by: Michael Watanabe
Source: Law 360