TO AMEND THE PACKERS AND STOCK YARDS ACT, 1921

WEDNESDAY, MARCH 14, 1934

UNITED STATES SENATE,

COMMITTEE ON AGRICULTURE AND FORESTRY,

Washington, D.C.

The committee met, pursuant to call, at 10 a.m., in room 324, Senate Office Building, Senator Ellison D. Smith (chairman) presiding. The CHAIRMAN. The committee will come to order.

The committee had under consideration the following bills which are here printed in full as follows:

[S. 2133, 73d Cong., 2d sess.]

A BILL To amend the Packers and Stockyards Act, 1921

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That the Packers and Stockyards Act, 1921, be, and the same is hereby, amended by enacting the following new sections, to be known as sections 305-A, 305-B, and 305-C:

"SEC. 305-A. The Secretary of Agriculture shall annually and upon the 1st day of July of each year designate as terminal livestock markets all stockyards posted by the Secretary pursuant to the provisions of the Packers and Stockyards Act, 1921, where livestock is sold in commerce under such conditions as to fairly reflect and establish a general market value of livestock of similar character in the territory adjacent or tributary to such stockyards and at which it is essential to the public welfare that there be maintained at all times an uninterrupted flow of livestock in interstate commerce and a steady, normal, and orderly demand for such livestock. Such terminal livestock markets are affected with a national public interest. The prices established on such terminal livestock markets are susceptible to manipulation and control by purchases of livestock for slaughter by packers on stockyards other than stockyards as defined by the Packers and Stockyards Act, 1921, resulting in unnatural and unreasonable fluctuations in such prices. Such fluctuations in prices are an obstruction to and a burden upon commerce in livestock and render legislation imperative for the protection of such commerce and the national public interest therein.

"SEC. 305-B. After ninety days after the designation of a posted stockyard as a terminal livestock market no packer purchasing livestock thereupon for slaughter at any packing plant or plants operated by such packer shall purchase or acquire in commerce, except at a stockyard posted by the Secretary under the Packers and Stockyards Act, 1921, livestock for slaughter at any such packing plant or plants, through the use, ownership, operation, or control, directly or indirectly, by itself or through any subsidiary, of any place, establishment, or facility where stockyard service or services, as defined in the Packers and Stockyards Act, 1921, or service or services in connection with the receiving, buying, selling, marketing, feeding, watering, holding, delivering, shipment, weighing or handling in commerce of livestock are furnished for others by such packer.

"Nothing contained in this Act shall be construed to prevent, limit, or in anywise affect the right of any such packer to make purchases in commerce of livestock directly from the producer or his agent where title to such livestock is acquired by such packer and such livestock is paid for by such packer prior to the shipment or delivery thereof to such packer by the producer or his agent. "SEC. 305-C. Any packer or any director, officer, receiver, operating trustee, lessee, agent, or person acting for or employed by such packer who knowingly authorizes, consents to or permits any violation of the provisions of section 305-B shall upon conviction thereof be punished by a fine of not more than $5,000 or by imprisonment of not more than three years, or both."

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[S. 2621, 73d Cong., 2d sess.]

A BILL To amend the Packers and Stockyards Act, 1921

Whereas stockyards as hereinafter defined are instrumentalities in the buying, selling, handling, and marketing of livestock in interstate commerce; and

Whereas such buying, selling, handling, and marketing of livestock in interstate commerce are affected with a national public interest; and

Whereas the buying, selling, handling, and marketing of livestock in interstate commerce on such stockyards and the practices, means, and methods engaged in or used in connection therewith are susceptible of obstructing and burdening interstate commerce in livestock; and

Whereas prices of livestock in interstate commerce on stockyards are susceptible of manipulation and control, resulting in unreasonable and artificial fluctuations in such prices; and

Whereas the buying, selling, handling, and marketing of livestock in commerce at stockyards which are not conducted or operated as public livestock markets are susceptible of being used and employed for the purpose and with the effect of making and giving in commerce, undue and unreasonable preferences and advantages to particular persons and localities, of manipulating and controlling prices of livestock in commerce, of creating a monopoly in, and apportioning territory for the acquisition of, buying, selling, and dealing in livestock in commerce, and of restraining, hindering, burdening, and obstructing livestock in commerce; and

Whereas it is deemed expedient as a means for the effective regulation of buying, selling, handling, and marketing of livestock in interstate commerce for the protection of that commerce and the national public interest therein to regulate the operation of stockyards as defined herein: Therefore

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled, That subdivision (d) of section 301 of the Packers and Stockyards Act, 1921 (42 Stat.L. 159), be, and the same hereby is, amended so as to read as follows:

"(d) The term 'dealer' means any person, including any packer, engaged in the business of buying or selling in commerce, livestock, other than on a commission basis, at a stockyard, whether for purposes of slaughter or otherwise."

SEC. 2. That section 302 of said Act be, and hereby is, amended so as to read as follows:

"SEC. 302. (a) When used in this title, the term 'stockyard' means any place, establishment, or facility commonly known as stockyards, conducted or operated for compensation or profit as a public market, consisting of pens, or other enclosures, and their appurtenances, in which live cattle, sheep, swine, horses, mules, or goats are received, held, or kept for sale of shipment in commerce: Provided, That the area of such place normally available for handling livestock, exclusive of runs, alleys, or passageways, is not less than 20,000 square feet.

"(b) When used in this title the term 'stockyard' also means any place, establishment, or facility consisting of pens or other enclosures and their appurtenances in which live cattle, sheep, swine, horses, mules, or goats are received, held, or kept for sale, slaughter, or shipment in commerce in sufficient volumes or in such manner or under such conditions as to enable the operator of such stockyard to manipulate or control prices of livestock in commerce, to create a monopoly in or apportion territory for the acquisition of, buying, selling, or dealing in livestock in commerce, or to establish or affect substantially the market value in commerce of livestock at stockyards as defined in subdivision (a).

"(c) The provisions of subdivision (b) shall not apply or extend to any place, establishment, or facility consisting of pens or other enclosures and their appurtenances operated and controlled by, and for the exclusive use and benefit of a cooperative livestock association or associations which comply with the provisions of an Act entitled 'An Act to authorize associations of producers of agricultural products' (42 Stat. L. 388).

"(d) The Secretary shall from time to time ascertain, after such inquiry as he deems necessary, the stockyards which come within either of the definitions contained in subdivisions (a) or (b), and shall give notice thereof to the stockyard owners concerned, and give public notice thereof by posting copies of such notice in the stockyards and in such other manner as he may determine. After the giving of such notice to the stockyard owner and to the public, the stockyard shall remain subject to the provisions of this title, except as provided in section

320, until like notice is given by the Secretary that such stockyard no longer comes within either of the foregoing definitions."

SEC. 3. That section 303 of said Act be, and hereby is, amended so as to read as follows:

"SEC. 303. After the expiration of thirty days after the Secretary has given public notice that any stockyard is within either of the definitions of section 302, by posting copies of such notice in the stockyard, no person shall carry on the business of a market agency or dealer at such stockyard unless he has registered with the Secretary, under such rules and regulations as the Secretary may prescribe, his name and address, the character of business in which he is engaged, and the kinds of stockyard services, if any, which he furnishes at such stockyard, and unless he has filed a reasonable bond, under such rules and regulations as the Secretary may prescribe, to secure the performance of his financial obligation as such market agency or dealer: Provided, however, That if such stockyard has been posted in accordance with the provisions of the Packers and Stockyards Act, 1921, or if a market agency or dealer is registered at the time this act takes effect and has filed a bond with the Secretary to secure the performance of his financial obligations, the Secretary shall not be required to post such a stockyard and may, in his discretion, accept such registration and bond as compliance with the provisions of this section and, when so accepted, such registration and bond shall have the same force and effect as registration or bond made or given subsequent to the passage of this Act. Whoever violates the provisions of this section shall be liable to a penalty of not more than $500 for each such offense and not more than $25 for each day it continues, which shall accrue to the United States and may be recovered in a civil action brought by the United States." SEC. 4. That section 310 (b) of said Act be, and hereby is, amended so as to read as follows:

(b) May make an order that such stockyard owner or market agency (1) shall cease and desist from such violation to the extent to which the Secretary finds that it does or will exist; (2) shall not thereafter publish, demand, or collect any rate or charge for the furnishing of stockyard services other than the rate or charge so prescribed, or in excess of the maximum or less than the minimum so prescribed, as the case may be; and (3) shall conform to and observe the regulation or practice so prescribed.

""

SEC. 5. That section 312 of said Act be, and hereby is, amended so as to read as follows:

"SEC. 312. It shall be unlawful for any stockyard owner, market agency, or dealer to

"(a) Engage in or use any unfair, unjustly discriminatory, or deceptive practice or device in connection with the receiving, marketing, buying, or selling on a commission basis or otherwise, feeding, watering, holding, delivery, shipment, weighing, or handling, in commerce at a stockyard, of livestock; or

(b) Make or give, in commerce, any undue or unreasonable preference or advantage to any particular person or locality in any respect whatsoever, or subject, in commerce, any particular person or locality to any undue or unreasonable prejudice or disadvantage in any respect whatsoever; or

"(c) Sell or otherwise transfer to or for any other person, or buy or otherwise receive from or for any other person, livestock for the purpose or with the effect of manipulating or controlling prices of livestock in commerce, or creating a monopoly in the acquisition of, buying, selling, or dealing in livestock in commerce, or of restraining commerce, or of apportioning territory for the acquisition of, buying, selling, or dealing in livestock in commerce; or

"(d) Engage in any course of business or do any act for the purpose or with the effect of manipulating or controlling prices of livestock in commerce, or of creating a monopoly in the acquisition of, buying, selling, or dealing in livestock in commerce, or of apportioning territory for the acquisition of, buying, selling, or dealing in livestock in commerce, or of restraining, hindering, burdening, or obstructing commerce in livestock; or

"(e) Conspire, combine, agree, or arrange with any other person (1) to apportion territory for the acquisit on of, buying, selling, or dealing in livestock in commerce, or (2) to manipulate or control prices of livestock in commerce; or "(f) Consp re, combine, agree, or arrange with any other person to do, or aid or abet the doing of, any act made unlawful by subdivision (a), (b), (c), or (d);

or

"(g) Whenever complaint is made to the Secretary by any person, or whenever the Secretary has reason to believe that any stockyard owner, market agency, or dealer is violating the provisions of subdivisions (a), (b), (c), (d), (e), or (f). the Secretary after notice and full hearing may make an order that he shall

cease and desist from continuing such violation to the extent that the Secretary finds that it does or will exist.

"(h) The provisions of subdivisions (c), (d), (e), and (f), except insofar as subdivision (f) applies to subdivision (a), shall not apply or extend to a cooperative livestock association or associations which comply with the provisions of the Act entitled 'An Act to authorize association of producers of agricultural products' (42 Stat. L. 338), nor to a stockyard operated by such an association, nor to a subsidiary or affiliated corporation or association completely owned and controlled by, and for the exclusive use and benefit of, such a cooperative livestock association or associations."

SEC. 6. That there be, and hereby are, added after the end of section 316 of said Act the following sections:

"SEC. 317. (a) Whenever the Secretary, after notice and full hearing, finds that any market agency or dealer is unable to meet his financial obligations as a market agency or dealer as they become due in the ordinary course of his business, he may suspend such market agency or dealer from carrying on business as such until it shall be shown to the satisfaction of the Secretary that such market agency or dealer is able so to meet his obligations.

"(b) Whenever the Secretary, after full notice and hearing, finds that any stockyard owner, market agency, or dealer, or any officer, agent, or employee of any stockyard owner, market agency, or dealer has knowingly violated or caused to be violated any of the provisions of subdivision (f) of section 306, or of section 307 or 312, or order, rule, or regulation of the Secretary thereunder, he may suspend such stockyard owner, market agency, dealer, officer, agent, or employee from carrying on or engaging in business or employment as a stockyard owner, market agency, or dealer, or officer, agent, or employee of a stockyard owner, market agency, or dealer at any stockyard subject to the provisions of this Act, and the Secretary may likewise suspend the operation of the stockyard of such stockyard owner committing such violation, for a specified period not to exceed five years.

"SEC. 318. (a) Whoever shall operate a stockyard wnich has been suspended or whoever shall carry on or engage in business or employment as a market agency or dealer, or officer, agent, or employee of a stockyard owner, market agency or dealer, during any period of suspension provided for by section 317, shall, upon conviction, be fined not more than $1,000 or imprisoned not more than one year, or both.

"(b) The conduct or operation of any stockyard which has been suspended by order of the Secretary or the conduct or operation of the business of any market agency or dealer during any period of suspension provided for by section 317 shall be unlawful, and may be enjoined by any court of competent jurisdiction, at the suit of the United States, the Secretary, or any party in interest.

"SEC. 319. (a) If any stockyard owner, market agency, or dealer violates any of the provisions of sections 312 or 317, he shall be liable to the person or persons injured thereby for the full amount of damages sustained in consequence of such violation.

"(b) Such liability may be enforced either (1) by complaint to the Secretary as provided in section 309, or (2) by suit in any district court of the United States of competent jurisdiction; but this section shall not in any way abridge or alter the remedies now existing at common law or by statute, but the provisions of this Act are in addition to such remedies.

"SEC. 320. The provisions of section 304 shall not apply or extend to a stockyard as defined in section 302 (b).”

SEC. 7. That the passage of this Act shall not affect or be construed to affect any violation of the Packers and Stockyards Act, 1921, committed prior thereto, or to relieve any person from liability for such violation; nor shall it affect or be construed to affect any matter or proceeding under the Packers and Stockyards Act, 1921, theretofore pending before the Secretary of Agriculture or the courts; nor shall it affect or impair, or be construed to affect or impair, the force or validity of any existing order of a court or of the Secretary of Agriculture issued pursuant to the provisions of said Packers and Stockyards Act, 1921.

SEC. 8. That nothing contained in this Act shall affect, nullify, repeal, amend, or alter, or be construed to affect, nullify, repeal, amend, or alter, in any manner any of the provisions of the Act entitled, "An Act to authorize association of producers of agricultural products" (42 Stat. L. 388).

SEC. 9. If any provision of this Act or the application thereof to any person or circumstances is held invalid, the validity of the remainder of the Act and of the app ication of such provision to other persons and circumstances shall not be affected thereby.