Shipley Do-Nut chief pleads guilty in immigration case
By JAMES PINKERTON Copyright 2008 Houston Chronicle
Aug. 28, 2008, 2:07PM
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James Nielsen For the Chronicle
Lawrence W. Shipley III, president of Shipley Do-Nuts, has pleaded guilty in federal court to employing illegal immigrants. His company's headquarters in north Houston were raided by immigration agents in April.

The Shipley Do-Nut Co. president pleaded guilty today β€” and three current and former managers are expected to follow suit next week β€” to charges stemming from an April immigration raid, the U.S. Attorney's Office announced.

Company President Lawrence Shipley III pleaded guilty before U.S. Magistrate Judge Stephen W. Smith to a misdemeanor charge of employing undocumented workers. He was sentenced to six months' probation and a $6,000 fine.

Shipley, 41, has served as president of the Shipley Do-Nut Flour and Supply Co. since March 2005.

The criminal inquiry into the company began on April 16, with a predawn raid at the headquarters and warehouse complex on Houston's north side. Investigators reported that more than 40 percent of the company's employees were in this country illegally.

U.S. Attorney Don DeGabrielle said this afternoon that company officials have agreed to pay $1.3 million in lieu of the federal government's confiscating various company-owned residences where undocumented workers were housed.

Others charged with hiring illegal immigrants were Christopher Halsey, 36, the company's warehouse supervisor; former warehouse manager Jimmy Rivera, 54; and current warehouse manager Julian Garcia, 38.

The three are expected to appear before a federal magistrate on Sept. 5.

The charge carries a maximum sentence of six months in prison and a $15,000 fine.

A guilty plea also is expected to be entered this afternoon on behalf of the company, which faces five years' probation and a $500,000 fine. Shipley Do-Nut officials have agreed to revise their hiring practices.

The raid at the company involved a caravan of nearly 50 law enforcement vehicles, most from U.S. Immigration and Customs Enforcement, which encircled the company's four-block compound at 5200 North Main.

At the warehouse facility, agents gathered all the Shipley workers and detained 20 for working without the required documents.

Nearly a dozen of the workers were released in the week after the raid after an immigration judge ruled they were eligible to post an bond. Last week, two of the Shipley workers returned to their old jobs after an immigration judge ruled they were legally entitled to remain in the United States and work, according to their attorney, Manuel Solis.

On the day of the raid, the company said it was cooperating with federal authorities.

''Shipley Do-Nuts is a family-owned and operated business with a 72-year history in the Houston area,'' the company, which operates 190 stores in several states, said in a statement at the time of the raid. ''It makes every effort to comply with very complicated immigration laws and is currently cooperating with authorities in an ongoing investigation.''

The raid followed a federal discrimination lawsuit filed in 2006 by 15 Shipley workers, who claimed they were subjected to ethnic slurs, taunts and sexual teasing by company supervisors. In February, the company settled the discrimination suit brought by the Equal Employment Opportunity Commission, but the terms were not announced.

james.pinkerton@chron.com


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