He's Gone: As Schwagstock founder Jimmy Tebeau enters federal prison, should other music-festival organizers worry about on-site drug use?

Jun 13, 2013 at 4:00 am

Jennifer Silverberg

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Anybody who has ever attended Bonnaroo, Lollapalooza, Coachella, Sasquatch or other major summer music festivals understands that drugs are an inescapable part of the experience. Many people enjoy the show sober. Others stick to alcohol. But inevitably there are thousands of people stoned out of their skulls, on every hallucinogen under the sun. It has been that way since the Woodstock era, when "sex, drugs and rock & roll" was a to-do list as much as an ethos.

So on November 1, 2010, when federal agents swarmed Camp Zoe, a 330-acre campground and festival venue in rural Missouri owned by the frontman of a Grateful Dead tribute band, their big announcement after four years of undercover investigation was less than shocking: People at a jam-band festival called Schwagstock were buying, selling and consuming marijuana, mushrooms, LSD, ecstasy and other drugs.

Who knew, right?

The more alarming revelation was that Jimmy Tebeau, the man federal prosecutors aimed to hold responsible for the drug activity, was not actually a drug dealer. He was the venue owner, concert promoter and lead singer of the Schwag, the festival's headlining act. Federal prosecutors contended Schwagstock was "an illegal drug haven, with its music as a side offering."

"We didn't view this as a music-festival prosecution," says Richard Callahan, U.S. Attorney for the Eastern District of Missouri. "We viewed it as somebody who was using a festival site to promote illegal drug sales and profit off of that. We thought there was a difference between a music festival with incidental drug use and a drug festival with incidental music. We believe in this case it was the latter rather than the former."

At first prosecutors weren't sure what charges to press against Tebeau. They used asset-forfeiture proceedings to take his land and freeze his bank accounts (see "Shakedown Street," published in the February 3, 2011, issue of Riverfront Times). Finally, six months after the raid on Tebeau's property, they accused him of "maintaining a drug involved premises" — a violation originally intended to punish landlords who lease houses to crack dealers.

One long-time friend describes Tebeau as "a low-key guy who doesn't like a lot of confrontation," but the 45-year-old with a bushy red beard and long dreadlocks is still indignant about being charged under the so-called Crack House Statute.

"That's not me at all," Tebeau says. "We're talking about a 330-acre campground, and I'm putting on music festivals. I'm paying for the sins of others. Some people were ingesting some drugs at the property and selling drugs, which I wasn't affiliated with in any way, shape or form."

Last June Tebeau reluctantly accepted a plea bargain. Had he gone to trial, he faced the possibility of a nine-year sentence. The government possessed overwhelming evidence that he at least tacitly allowed certain drugs to be bought and sold at Schwagstock (marijuana, hallucinogens and ecstasy were allegedly OK, while crack, meth, heroin and others were off-limits) and profited handsomely from the popularity of his festival as a result. The plea agreement explicitly states that the government could not prove Tebeau himself ever bought or sold drugs.

Prosecutors say the circumstances of the case are unique, but civil-liberties advocates warn that targeting a musician and venue owner sets an ominous precedent for festivals and concert sites nationwide. Tebeau is believed to be the first artist or festival organizer ever imprisoned for widespread drug use at a music festival.

"Club owners should be fearful," says Daniel Abrahamson, director of legal affairs for the Drug Policy Alliance, a nonprofit advocacy group working to reform American drug laws. "There is precedent of government overreach with this statute, implicating core First [and Fifth] Amendment concerns."

Abrahamson and others wonder when the government, having targeted Tebeau, will next decide that drug use at a concert has crossed the line from open secret to something that deserves punishment. How does one prove that fans are drawn to a summer festival for the party and not the music? And could the organizers of a mega-festival like Bonnaroo be next?

Tebeau is exactly what you'd expect from a guy fronting a band that promises to "preserve and perpetuate the vibe and music made popular by the Grateful Dead": He is a cheerful old hippie through and through. But his keen business acumen is at odds with the fun-loving-stoner stereotype.

In 1997 Tebeau (pronounced tee-boh) began organizing Schwagstock festivals at campgrounds in rural Missouri. The events were a showcase for his band, the Schwag, and they gained a steady following among Deadheads and Haight-Ashbury revivalists from around the Midwest. The gigs were profitable, but Tebeau wisely recognized that a substantial chunk of his change was lost to the rental fees he paid to the host venues.

On April 8, 2004, the bandleader tapped his savings and borrowed money from family members to purchase Camp Zoe, a sprawling tract of land squarely located in the middle of nowhere: about 80 miles southeast of Fort Leonard Wood near the tiny town of Eminence. Formerly the site of a church youth retreat, the property borders the Ozark National Scenic Riverways near the Current River.

Tebeau envisioned the perfect venue for Schwagstock: beaches, caves, swimming holes and a secluded place to party.

"I never really wanted to be a campground owner," he says in hindsight. "I just wanted to be a musician. But I thought, 'Hey, I'll put my name on the mortgage and build some equity. If it all fails, at least I'll make a few bucks on the back end with the real estate.'"

Before long business was booming. In addition to the bands, entertainment came to include dancers, parades, bonfires, drum circles, fire-baton acts and laser light shows. It was Branson for hippies. Once just a performer and promoter, Tebeau established his own vertically integrated music enterprise. Beyond the $60 cost of admission, concert attendees paid to rent their camping spot from him and purchased food, drinks, firewood and other goods from his general store. He staged five to seven festivals each year with an average attendance of 6,000 per event. Festivities commenced with "Spring Jam" in April and concluded with "Spookstock" on Halloween.

From 2004 to 2010, Tebeau deposited more than $4.6 million cash in his local bank, according to a search warrant affidavit filed October 29, 2010, by an IRS special agent. The operation was so lucrative the DEA came to suspect he was peddling more than just music.

Local law-enforcement agents paid their first serious visit to Schwagstock in August 2006, according to court documents. Undercover officers from the Missouri State Highway Patrol bought two ounces of hallucinogenic mushrooms from a pair of dealers making the rounds at Camp Zoe. The men told the officers they had three pounds they intended to unload before the festival ended. (Both dealers were later arrested and eventually pleaded guilty to federal drug charges.) Beyond their encounter with the mushroom merchants, the troopers noted the "unfettered illegal drug use" they witnessed at Schwagstock.

"Drug sellers walk around the campground making contact with other campers and people gathered in front of the stages to watch the bands play," states an affidavit filed with a request for a search warrant on October 22, 2010. "The sellers will approach campers and ask if the campers want 'nuggets' for example, which is marijuana, or 'shrooms' meaning psychedelic mushrooms."

The undercover highway-patrol officers paid close attention to Tebeau's security force, a staff of about ten managed by St. Louis-based B&D Security, which operates at several prominent St. Louis music venues. (B&D Security declined to comment for this story.) The undercover agents reported that security guards merely asked dealers to be discreet and set up shop away from the main festival entrance. Dealers were "not hampered by the Camp Zoe security personnel; in fact, the investigating officers made controlled drug purchases from at least one security person," the affidavit reads.

Tebeau insists he had little control over the day-to-day operations at the campground. "I just came to play music," he says. "I rehearsed with the band all through the week, then played the show. I wasn't so in touch with daily activities of the campground and security. We hired security to deal with issues like [drugs], but apparently they weren't always doing their job."

Court documents state that Tebeau "visits the campgrounds very often, socializing with campers and checking their campsites." Officers videotaped Tebeau "smoking a substance that appears to be marijuana."

The frontman of a Grateful Dead tribute band indulging in a few puffs of reefer is hardly a revelation, but other incidents would soon confirm that drug dealing at Camp Zoe had crossed a line.

On August 15, 2006 — coincidentally, just after the weekend when the highway patrol first infiltrated Camp Zoe — a young man was found dead in a motel in Rolla. According to police, David Smith was headed home to Kansas City after attending Schwagstock. His friends said he'd recently taken four or five methadone pills he bought at the festival. A drug screening found amphetamines, benzodiazepines, cocaine and marijuana in his system. The death was ruled an overdose.

The incident, coupled with the mushroom bust and accounts of unchecked drug dealing, compelled federal law enforcement to join the Missouri State Highway Patrol's investigation of Tebeau. Together the DEA, IRS and highway patrol spent the next three summers sending undercover agents to Schwagstock.

All told, the feds made more than 120 controlled drug buys from 2006 to 2010, acquiring everything from moonshine to marijuana to LSD tabs labeled "Foxy." When investigators failed during that period to prove that Tebeau did much other than promote concerts and perform, they searched for evidence that he was acting irresponsibly and indirectly profiting from the Camp Zoe drug trade.

On January 11, 2010, Tebeau's sister Christine Atkinson and her husband were arrested for buying pseudoephedrine from multiple stores in the same day. According to court documents, after grilling Atkinson about allegedly smurfing pills in order to manufacture meth, police asked about her duties at Camp Zoe.

Atkinson worked at "Safestock," an improvised medical facility at the campground. She told police that "kids show up at the festivals and that they use drugs like ecstasy and LSD for the first time." Atkinson said her job was keeping the inexperienced users hydrated and making sure their condition did not deteriorate.

When she was arrested again three months later for alleged possession of methamphetamine, Atkinson was more forthcoming. She estimated that 80 percent of Schwagstock campers were teenagers and that 75 percent of those teens were using or selling drugs. "Everybody is doing something," court documents quote Atkinson saying. "I'm sure you can get anything down there. Syringes are everywhere."

Atkinson described incidents in which kids freaked out on ecstasy or LSD were physically restrained by being strapped to a table. She said many teens should have been hospitalized and claimed their parents later called to complain.

Tebeau says he was never personally involved in supervising the Schwagstock medical tent, and he remains incredulous that the existence of a medical tent that tended to the occasional drug-related crisis could be considered incriminating.

"Any major festival always has a medical facility, and always there's some drug-related incident," Tebeau says. "I never saw restraints. I heard one guy was getting wild, and they restrained him. I have mixed emotions about that, but apparently he was pretty drunk and pumped up on whatever."

Tebeau says there were no fatal drug overdoses at Schwagstock. He points out that by contrast, since Bonnaroo was first staged in 2002, eight people have died from drug overdoses at the annual Tennessee festival.

"At any music festival, you'll get people with other motivations for going there," he argues. "Ask a thousand people if they're there for the music, and they'll all say yes, but if you dig deep enough, long enough, you'll find people there for the wrong reasons. The amount of drug dealing and mayhem I saw at [Bonnaroo] — I never felt we were anywhere close to that."

There are certainly a handful of similarities between Bonnaroo, which happens this week, and Schwagstock, the most obvious being that both take place on remote, privately owned farms about 300 miles apart. But the sheer scale of Bonnaroo — attendance routinely tops 100,000 — and the caliber of artists involved (headliners include Paul McCartney, Tom Petty and Björk) are a world away from Tebeau's mom-and-pop operation.

A closer cousin of Schwagstock might be the notorious Gathering of the Juggalos. Held on private property in tiny Cave-in-Rock, Illinois, about 150 miles southeast of St. Louis, the annual event attracts more than 10,000 fans of Detroit rappers Insane Clown Posse. Music is ostensibly the main attraction — George Clinton, Ice Cube, Warren G and other hip-hop legends have performed — but debauchery rules the day. There are carnival rides, wrestling, wet T-shirt contests and more, a spectacle Village Voice writer Camille Dodero famously described as a "shantytown psycho-porn amusement park."

Drugs are openly bought and sold at the Juggalo party. There's a dark corner of YouTube dedicated to "Gathering of the Juggalos Drug Bridge," where solicitations run the gamut from "I got LSD, 'shrooms and ecstasy, dawg," to "buy some weed, see some titties." It makes the DEA's frumpy description of the Tebeau homestead festivities seem tame in comparison. Private security patrols the grounds at the Juggalo gathering; the local sheriff has refused to send in officers, publicly citing concerns for their safety.

There is, of course, widespread drug use at Bonnaroo as well. Last year police seized twenty pounds of Rice Krispies treats laced with marijuana, along with small quantities of LSD, cocaine, ecstasy, mushrooms and synthetic drugs. In 2011 authorities in a nearby Tennessee county boasted of confiscating "more than $12,000 worth of illegal drugs en route to the annual festival." Nevertheless, Tennessee law-enforcement officials heap praise on Bonnaroo.

"They're as much against drugs coming in as we are," says Billy Cook, director of a task force on drugs and violent crime for the Coffee County District Attorney's Office. "A lot of times [Bonnaroo] security will bring people to us that are dealing drugs or have drugs on them. The Bonnaroo administrative people — I think they do a good job. They're our allies instead of our enemy."

There is a strong economic incentive for Coffee County to keep things running smoothly at Bonnaroo. One study estimates that the mega-festival provides $14 million worth of annual revenue for the sparsely populated swatch of southeastern Tennessee.

"I don't want people to get the false idea that this is just a drug fest, because it's not," Cook says. "There's a tremendous amount of good people that come to this. They come to enjoy the music and events and things, and that's really what it's all about. It's not about the drug stuff."

Tebeau says he paid more than $200,000 in tax revenue to Shannon County over the years but that his relationship with local law enforcement was always adversarial. He claims the Shannon County sheriff told him he couldn't spare officers to patrol Schwagstock, and he says the state highway patrol rebuffed his request for assistance, as well, opting instead to set up roadside checkpoints and hassle drivers going to and from Camp Zoe.

"I found out later the highway patrol was part of the undercover investigation, so of course they're not going to help me," Tebeau says now. "I was almost set up for failure in a way."

In truth, Schwagstock was destined for failure in more ways than one. Tebeau clearly never felt that widespread use of marijuana and hallucinogens was a problem at his shows. (Jerry Garcia surely felt the same way during the heyday of the Grateful Dead.) His tolerance was slowly exploited until he totally lost control of what was happening on his property.

Undercover agents interviewed a cocaine dealer who boasted of selling two kilograms of product every weekend at Camp Zoe. (Court documents say the man, a convicted armed robber, was banned from the festival in 2010 for carrying a gun.) "It is common," the feds alleged, "for the officers to walk around the grounds and witness drug sellers weighing out powder cocaine in the open for a buyer."

Callahan, the federal prosecutor, points to a DEA estimate that $500,000 worth of drugs changed hands every weekend at Schwagstock.

"I'm not aware of any other festival venue other than perhaps Woodstock where that could happen," Callahan says with a laugh. "I wasn't there — although I wish I were — but Woodstock was a one-time phenomenon. These [Schwagstocks] were occurring four or five times a year. This was more of a business."

Of course, nobody really has a handle on the volume of drugs that are bought and sold each year at music festivals. Callahan's unspoken message is that law enforcement can stomach thousands of pot-smoking, acid-eating freaks running wild for a weekend so long as they keep to themselves and buckle their seat belts on the way out of town. But if the same bearded hippie flouts the rules all summer long, beware the long arm of the law.

Tebeau's case is not the first time federal prosecutors have used the so-called Crack House Statute to target the owner of a music venue. The law, broadly drafted to criminalize properties maintained "for the purpose of unlawfully manufacturing, storing, distributing, or using a controlled substance," dates back to the mid-1980s, but it was amended in 2002 at the urging of then-U.S. Senator Joe Biden. Hysteria surrounding crack cocaine faded years before. Ecstasy and rave parties were the new battles in the drug war.

In 2001 federal prosecutors tried to use the Crack House Statute against a trio of New Orleans club owners who frequently hosted raves at their venue, claiming the men "knew that drugs were being used and distributed at their raves but did nothing to prevent it." The club owners agreed to a settlement, later blocked through appeal, which banned glow sticks and similar items at their events. That same year a jury in Florida refused to convict two nightclub owners accused of profiting from drug use and raves at their venue.

In response, Biden introduced the Reducing Americans' Vulnerability to Ecstasy (RAVE) Act, which was, he explained, intended to tweak the Crack House Statute so that it could be applied to "rogue promoters who were knowingly using property episodically or on a one-time basis for illegal drug purposes."

The Crack House Statute was already unpopular with civil libertarians because it allowed prosecutors to punish business owners for the offenses of others. When Biden sought to target a specific subset of music fans and venues, the outcry was swift and forceful.

"Put most simply, the federal government should return to the task of identifying and stopping illegal drug activity, whether it occurs at a rave or elsewhere," Graham Boyd, director of the American Civil Liberties Union's Drug Policy Litigation Project, testified before Congress. "The government must not allow for harassment or punishment of innocent business owners who are unable to guarantee absolutely that drug use will not occur on their property."

The RAVE Act was defeated, but nearly identical language was later inserted as an amendment to another bill. Police, prosecutors and the public gradually lost interest in raves, however, and the law was not successfully applied until the DEA set its sights on Schwagstock.

After pleading guilty, Tebeau took his case to the Eighth Circuit Court of Appeals to argue that the law didn't apply to a music festival. The lower court's ruling was upheld.

"I think there was a lot of pressure in this case, because I'm sure there were a lot of people who didn't like that festival in their neck of the woods," says Tebeau's lawyer, St. Louis-based defense attorney Scott Rosenblum. "I can't really say anything our government does surprises me anymore, but there's no question there was a substantial amount of resources put into this case. To some extent it's a scary type of case in terms, I guess, of how far they're going to go to apply [the Crack House Statute]."

Callahan says there were serious discussions among law-enforcement officials about whether Tebeau could or should be held accountable for people buying and selling drugs on his property.

"We had to wrestle with issues of whether it made him criminally responsible or not," the federal prosecutor says. "We wanted to be careful not to cross the line so that we were going after a music festival simply because of what a minority of patrons were doing.

"[This] doesn't serve as a warning to major music festival sites that are sincerely trying to operate within the law," Callahan emphasizes. "I'm sure you can go to a Willie Nelson concert and smell the aroma of marijuana, but I don't think his concert is promoting the sale of drugs."

The fact that prosecutors used asset forfeiture to confiscate Tebeau's property — the land upon which he lived with his wife and two young children — still rubs some people the wrong way. Mike Cullen, Tebeau's neighbor at Camp Zoe who helped out with groundskeeping, wonders why authorities chose to bust Tebeau rather than the actual drug dealers.

"There's a lot of resentment still in the community from that," Cullen reports. "They don't like the idea that the government is swooping in there and taking somebody's property. They could have gone in with an investigative team and just busted people actually accused of selling drugs. Jimmy got a bum rap on that. But they have to blame somebody, and since he owned the place, there it was."

Cullen adds that he was disappointed other concert venues and music festivals in Missouri and beyond did not speak up in support of Tebeau.

In reality, most festivals and venues want to distance themselves as much as possible from drug use. Representatives from several major festivals (including Coachella, Bonnaroo and Sasquatch) declined to comment for this story when asked about drug use at their events. It seems ignoring the issue entirely is a safer strategy than reproaching law enforcement for making an example of someone.

On May 25, Tebeau played a farewell show with the Schwag at 2720 Cherokee in St. Louis. A mélange of hippies old and young lined up around the block before the doors opened. Despite a thorough security check, the aroma of smoldering weed wafted through the venue. The occasion was somber, but the atmosphere was playful and boozy. When it came time for the encore, the band played the Grateful Dead songs "Row Jimmy" and "Touch of Grey." It was an emotional moment for Tebeau.

"I noticed during 'Row Jimmy' that [Jimmy] was starting to struggle with singing the lines," recounts Schwag guitarist Sean Allen Canan. "His hat was down low over his eyes, and I could see he was swollen and choking out the lyrics by the time he began to sing 'Touch of Grey.' Not to mention all the hardcore fans in the front who were crying, as well as his wife and our crew on the side of the stage.

"It was very surreal and bittersweet for everyone."

Three days later Tebeau reported to a minimum-security prison in Yankton, South Dakota, to begin serving his 30-month sentence. The facility is 600 miles away from his family in St. Louis, but he's buoyed by a rumor that well-behaved inmates have access to a music room where he might be able to practice playing guitar.

"Hopefully I'll keep my chops up and come out a better musician than when I went in," Tebeau says. "I've played 3,000 gigs in my life, and I want to play 3,000 more. They said people weren't coming [to Schwagstock] for the music, but when we were playing there was quite a few people in front of the stage there to see the show. Some people go for wrong reasons, but I think the vast majority were there for the music."