Lobbyist Cops Espy Case Plea,
Will Testify To Giving "Gifts"

SAN FRANCISCO — A former agribusiness lobbyist has admitted lying to the FBI about $17,000 in so-called "gifts" to former Clinton administration Agriculture Secretary Mike Espy and has agreed to testify against Espy, his longtime friend.

In exchange for Richard Douglas' guilty plea, an independent counsel has agreed to dismiss other charges against Douglas and recommend no jail time if he cooperates fully.

Douglas, 49, was senior vice president for corporate affairs for Sun-Diamond Growers of California, a major almond cooperative and exporter, during 1993 and 1994, the period covered by the charges.

Sun-Diamond has been convicted and fined $1.5 million for giving illegal gratuities to Espy and illegal campaign contributions to his brother Henry, an unsuccessful congressional candidate.

Espy resigned from President Clinton's Cabinet in December 1994 because of the investigation. He has been charged with accepting $35,000 in sports tickets, travel and lodging from Sun-Diamond, Tyson Foods and other companies regulated by the Agriculture Department, and then lying about it.

The plea "confirms the corporate arrogance of Sun-Diamond Growers in willfully and repeatedly violating the criminal proscriptions against the regulated giving gifts to the regulators," Independent Counsel Donald C. Smaltz said in a statement.

Defense lawyer John Keker declined comment.

The plea ends a contentious case in which defense lawyers fought to dismiss the charges and accused prosecutors of racial motives for trying the black defendant in San Francisco instead of Washington, D.C. Government lawyers accused the defense of trying to inject an irrelevant racial issue into the case.

Last November, a jury in San Francisco convicted Douglas of a felony charge of giving up to $7600 in illegal gifts to Espy on Sun-Diamond's behalf to try to influence Espy's conduct.

Last month, U.S. District Judge Thelton Henderson overturned Douglas' conviction and dismissed that charge and the charge on which the jury deadlocked. Henderson ruled that the charges concerned events that took place outside California and should not have been tried here. He said the government could refile the charges in Washington, D.C.

In Monday's plea agreement, Douglas admitted lying to the FBI, and Smaltz agreed to dismiss all other charges.

The charge is punishable by five years in prison and a $250,000 fine. But Smaltz said in the plea agreement that federal guidelines called for a sentence of no more than six months, and that he would recommend probation if he finds that Douglas has provided "substantial assistance" to the investigation and prosecution. The agreement requires Douglas to cooperate with prosecutors and testify at all trials.

The agreement does not cover the amount of any fine.

In a related development, a federal judge in Washington D.C. last week sentenced Espy’s chief of staff to prison as a thinly veiled example to others in the Clinton administration.

Saying democracy relies upon honest public officials, U.S. District Judge Royce Lamberth sentenced Ronald H. Blackley to an unusually harsh 27 months in prison for making false statements.

Lamberth said he departed from sentencing guidelines that called for only probation for Blackley because the offenses were committed when Blackley was in a top government position of trust.

"This court has a duty to send a message to other high government officials that there is a penalty to be paid for making false statements under oath," Lamberth said. "Our democracy depends upon trust between the people and government officials."

The judge waived any fine because Blackley is unable to pay one, but he ordered Blackley to remain on probation for three years after his release from prison.

Without specifically mentioning independent counsel Kenneth Starr's investigation into President Clinton, Lamberth alluded to "discussions" around town about the seriousness of lying under oath.

"This should be a deterrent to other government officials," the judge said.

Blackley was convicted in December of failing to disclose $22,000 he received from Mississippi associates who had dealings before the Agriculture Department and then trying to cover it up.

A jury found that Blackley lied on his government financial disclosure forms and then to a series of federal investigators.