State completes audit of disputed herd; records show no discrepancies at Easterday operation

A review of state brand inspection records has failed to find discrepancies that would explain how one of the nation’s largest meatpackers could have lost 200,000 cattle through business dealings with a Mesa, Washington-based rancher.

The Washington state Department of Agriculture initiated the audit earlier this year after Tyson Fresh Meats, which operates a packing plant near Pasco, alleged in a lawsuit that Easterday Ranches Inc. defrauded the meatpacker of $225 million by claiming to have purchased and fed for the company about 200,000 cattle that never existed.

“Given the two operations are engaged in this legal dispute involving the number of cattle, the program undertook this because it seemed like a prudent step to take to ensure there were no areas of concern or issues with this information we received,” department spokesman Hector Castro said.

The state-reviewed brand inspection reports that Easterday Ranches are required to provide monthly that show how many cattle it had in feedlots from January 2019 to January 2021. Inspectors then compared those documents to reports submitted by Tyson reflecting the number of cattle it processed at the meatpacking plant at Wallula.

“They didn’t find any discrepancy between the numbers,” Castro said.

Robbie Parke, manager of the state’s Livestock Inspection Program, said in an earlier interview that each time a cow changes hands, it triggers an in-person inspection. That cow is then tracked monthly until it’s processed. Because Easterday’s feedlot was one of only 11 certified by the state Department of Agriculture, the only in-person inspection occurred when the cow arrived at the feedlot. Everything else became a paper report.

Castro said the department’s review of documents didn’t look at the in-person inspections, but focused instead on those monthly paper audits of how many cattle Easterday Ranches reported feeding in its pens.

“It’s done to ensure that the person selling or transferring the livestock owns it and has the right to sell it,” Castro said of the process. “It’s just like tracking vehicle registration. You want to make sure that that person owns that cow.”

The state did not initiate the audit to locate the missing herd, he said.

“That’s not what we were trying to do,” Castro said. “We are not stepping into the issue between Easterday and Tyson. We were just trying to confirm whether the data they reported to us was accurate. It appears that it is.”

According to court records, Easterday Ranches would bill Tyson for cattle it purchased and then fed to slaughter weight. But late last year, Tyson officials said they became aware of problems.

“Its investigation, including the admissions of Defendant’s President Cody Easterday, showed there were over 200,000 head of cattle that Defendant reported to be in inventory, but which did not exist,” Tyson attorney Alan D. Smith wrote in court records.

After the lawsuit was filed in state court, Easterday Ranches Inc. and Easterday Farms both filed for Chapter 11 bankruptcy protection in early February, alleging that each owed creditors, including Tyson, more than $100 million.