New wrinkle could keep cattle rancher Easterday out of federal prison a while longer
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Easterday Farms and Ranch legal issues
The Easterday Family’s businesses have been embroiled in a bankruptcy case with debtors trying to recover more than $250 million after Cody Easterday was charged with wire fraud in a “ghost cattle” scheme.
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Cody Easterday was set to report to prison next week, bringing the saga of his $250 million “ghost cattle” scheme one step closer to an end. But now his attorneys are asking for the deadline to be extended.
Easterday was to turn himself in to the Bureau of Prisons on Nov. 18, a month and a half after being sentenced to 11 years in prison for wire fraud, in a scheme in which he charged Tyson Foods and another company for the care of hundreds of thousands of cattle that never existed.
The wire fraud took place over a period of at least four years, before being discovered in late 2020.
Easterday originally requested to be placed Federal Correctional Institute Sheridan in Oregon to be near family, but his lawyers said in a recent court filing that Sheridan is apparently preferred for prisoners in a residential drug abuse program.
The Bureau of Prisons instead assigned him to FCI Herlong, a small prison in northern California about an hour north of Reno, Nev.
A Federal Correctional Institute is the agency’s term for a minimum security prison. They are often work and program-oriented, according to the its website.
Now his lawyers are requesting he be sent to FCI Lompoc, which is a few hours north of Los Angeles. U.S. District Court Judge Stanley Bastian in Eastern Washington can make recommendations, but ultimately the decision lies with the Bureau of Prisons. If approved, that could also push back the date he has to report to prison.
Why Lompoc?
At Lompoc, Easterday would also have more opportunity to participate in “productive activities” and “evidence based recidivism reduction programs.”
Lompoc is in Santa Barbara County, with about 960 prisoners at the FCI portion of the complex. It is a satellite on the campus of the medium security USP Lompoc, which houses about 2,100 prisoners.
His lawyers say in the filing that these programs would let Easterday earn federal time credits to allow him to transition into a halfway house or home confinement sooner. They pointed to a farming a livestock program at Lompoc that would be especially suited for him, given his background.
While it is farther away than Herlong, his lawyers said that the proximity to Los Angeles would allow his family to stay with relatives in Ventura when going to visit. Ventura is about an hour and a half away from Lompoc.
His lawyers also have filed a motion to extend Easterday’s self report deadline to allow the request to be processed. The U.S. Attorney’s Office and his probation officer did not oppose the motion, according to the documents filed. That means he could be out of prison for a while longer while the government makes its decision.
Gambling addiction
Easterday pleaded guilty in March 2021 to wire fraud but has remained out of prison while he helped settle the bankruptcy for his family’s extensive businesses, Easterday Farms and Easterday Ranches.
Easterday was sentenced on Oct. 4 in U.S. District Court in Yakima to 11 years in prison. He’ll be on probation for three years after that.
He also was ordered to pay the full restitution of $244 million agreed to in his plea agreement. However, the judge will hear arguments at a later date, that could reduce the amount he still owes.
His cooperation in the bankruptcy helped earn less than the possible maximum sentence of up to 20 years.
Easterday admitted to what prosecutors dubbed a “ghost cattle” fraud in which he charged Tyson for the care of more than 265,000 head of cattle that never existed.
He said he stole the money in order to offset more than $200 million in losses on the commodity futures market. Just before the trial his attorneys argued Easterday has a gambling addiction, in a bid to reduce his sentence.
While Easterday’s attorneys are still negotiating the restitution portion of the case, he was ordered to pay back the full $244 million. Of that amount, $233 million will go to Tyson Foods, and the remainder to Segale Properties.
His lawyers believe Easterday may be entitled to some offsets for the use of his likeness in an international branding deal, and for money spent caring for the cattle in Easterday’s care after he pleaded guilty.
If those offsets were approved, which include payments already made of about $66 million, it would reduce the remaining debt to just $7.5 million.
That means Easterday would have paid back less than 30%, or about $73.5 million of the $244 million.
The family’s bankruptcy proceedings are also nearly wrapped up, with a tentative settlement agreed upon by most debtors. After filing for bankruptcy, the family liquidated its business assets, raising an estimated $250 million.
The largest portion was $209 million for property sold to AgriNorthwest for 18,000 acres. AgriNorthwest is a subsidiary of The Church of Jesus Christ of Latter-day Saints, and already owned property adjoining the Easterday ranch.
Easterday also agreed to a settlement for most of their smaller credits $10.76 million to be divided up by 65 businesses. The only remaining claims would be Tyson, Segale and Rabo Agrifinance. Rabo is currently holding out in an attempt to recoup the principal and interest owed on a $1 million loan.
This story was originally published November 11, 2022 at 5:00 AM with the headline "New wrinkle could keep cattle rancher Easterday out of federal prison a while longer."
