[S. 3064, 73d Cong., 2d sess.]

A BILI. 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 section 202 of the Packers and Stockyards Act, 1921, is hereby amended so as to read as follows:

"SEC. 202. It shall be unlawful for any packer to

"(a) Engage in or use any unfair, unjustly discriminatory, or deceptive practice or device in commerce;

"(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 ot any undue or unreasonable prejudice or disadvantage in any respect whatsoever;

"(c) Sell or otherwise transfer to or for any other packer, or buy or otherwise receive from or for any other packer, any article for the purpose or with the effect of apportioning the supply in commerce between any such packers, if such apportionment has the tendency or effect of restraining commerce or of creating a monopoly in commerce;

"(d) Sell or otherwise transfer to or for any other person, or buy or otherwise receive from or for any other person any article for the purpose, or with the effect, of manipulating or controlling prices in commerce, or of limiting competition, or of creating a monopoly in the acquisition of, buying, selling, or dealing in any article in commerce, or of restraining commerce, or for the purpose of removing any such article otherwise normally within the current of commerce through a stockyard or stockyards under the supervision of the Secretary and posted as such pursuant to the provisions of title 3 of this Act from such current of commerce;

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'(e) Engage in any course of business or do any act for the purpose or with the effect of manipulating or controlling prices in commerce or of limiting competition or of creating a monopoly in the acquisition of, buying, selling, or dealing in any article in commerce, or of restraining commerce in livestock as placed under the supervision of the Secretary pursuant to the provisions of this Act;

"(f) Conspire, combine, agree, or arrange with any other person (1) to apportion territory for carrying on business in commerce, or (2) to apportion purchases or sales of any article in commerce, or (3) to manipulate or control prices in commerce;

"(g) Own, lease, operate, or control, directly or indirectly, any place, establishment, or facility furnishing stockyard services as defined in this Act other than receiving pens at the packing plant or plants of such packer or a stockyard under the supervision of the Secretary and posted as such pursuant to the provisions of title III of this Act;

"(h) Operate any packing plant at which any livestock is slaughtered in commerce unless he has registered with the Secretary, under such rules and regulations as the Secretary may prescribe, and in accordance with the provisions of section 10 of this Act, his name and address, the name and location of such packing plant, and the character of livestock slaughtered or to be slaughtered and processed therein;

"(i) Purchase or acquire livestock in commerce for the purpose of resale of the same, or for any purpose other than that of the slaughter and processin thereof, in a packing plant or plants owned and operated by such packer; or "(j) Conspire, 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), (d), (e), (g), (h), or (i).”

SEC. 2. That the Packers and Stockyards Act, 1921, is hereby amended by striking out all of sections 203, 204, and 205, and substituting therefore new sections 203, 204, and 205, as follows:

"SEC. 203. (a) Whenever complaint is made to the Secretary by any peson, or whenever the Secretary has reason to believe that any packer has violated or is violating any terms of this title, he shall cause a complaint in writing to be served upon the packer, stating the charges in that respect and requiring the packer to attend and testify at a hearing at a time and place designated therein at least thirty days after the service of such complaint; and at such time and place there shall be afforded the packer a reasonable opportunity to be informed as to the evidence introduced against him (including the right of cross-examination) and to be heard in person or by counsel and through witnesses, under such regulations as the Secretary may prescribe. Any person for good cause shown may on application be allowed by the Secretary to intervene in such proceeding

and appear in person or by counsel. At any time prior to the close of the hearing the Secretary may amend the complaint; but, in case of any amendment adding new charges, the hearing shall, on the request of the packer, be adjourned for a period not exceeding fifteen days;

'(b) If after such hearing the Secretary finds that the packer has violated or is violating any provisions of this title covered by the charges, he shall make a report in writing in which he shall state his findings as to the facts and shall issue and cause to be served on the packer an order requiring such packer to cease and desist from continuing such violations to the extent that the Secretary finds that it does or will exist. This testimony taken at the hearing shall be reduced to writing and filed in the records of the Department of Agriculture; '(c) The Secretary at any time, upon such notice and in such manner as he deems proper but only after reasonable opportunity to the packer to be heard, may amend or set aside the report of order in whole or in part;

(d) Complaints, orders, and other processes of the Secretary under this section may be served in the same manner as provided in section 3 of the Act entitled "An Act to create a Federal Trade Commission, to define its powers and duties, and for other purposes", approved September 26, 1914.

"SEC. 204. (a) Upon the application of the Attorney General of the United States, at the request of the Secretary, the district courts of the United States shall have jurisdiction to issue writs of mandamus commanding any packer to comply with the provisions of this Act or any order of the Secretary made in pursuance thereof.

"(b) The Secretary may revoke, or suspend for such period as he may determine, the registration of any packing plant or plants operated by any packer who knowingly fails to obey any order made by the Secretary under the provisions of this title or who, upon complaint after hearing as herein provided, is found by the Secretary guilty of the violation of any provisions of this chapter;

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(c) For the purpose of this title, the provisions of all laws relating to the suspending or restraining the enforcement, operation, or execution of, or the setting aside in whole or in part, the orders of the Interstate Commerce Commission are made applicable to the jurisdiction, powers, and duties of the Secretary in enforcing the provisions of this title, and to any person subject to the provisions of this title;

"SEC. 205. Any packer, or officer, director, agent, or employee of a packer, who fails to obey any order of the Secretary issued under the provisions of this title or who violates any provision of this Act shall on conviction in a proceeding instituted in the name of the United States, brought in the district court of the United States for the district in which such violation or violations were committed or such failure or failures to comply with an order of the Secretary occurred be fined not less than $500 nor more than $10,000. Each day during which any such failure or violation continues shall be deemed a separate offense."

SEC. 3. Subdivision (d) of section 301 of the Packers and Stockyards Act, 1921, is hereby amended to read as follows:

"(d) The term 'dealers' means any persons, including any packer, engaged in the business of buying and selling in commerce livestock other than on a commission basis at a stockyard, whether for purposes of slaughter or otherwise. SEC. 4. That section 302 (a) 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, 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 or incident to, or in connection with, purchase, sale, holding, feeding, watering, receiving, marketing, delivery, weighing, handling, or shipment in commerce, and where the total number of livestock handled in any one week is 250 head or more: Provided, That the term 'stockyard' shall not include farmers' pens or corrals, or those places, establishments, or facilities operated by or for common carriers for the sole purpose of loading, unloading, reloading, feeding, watering, or resting livestock where no buying or selling of, or trading in, livestock is done or permitted, or facilities at slaughtering establishments used for the sole purpose of holding livestock preliminary to its slaughter at or in the slaughtering establishment where such livestock is received."

SEC. 5. 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 the definition 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 obligations 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. 6. The Packers and Stockyards Act, 1921, is hereby amended by adding an additional section to be known as "section 304-A."

"SEC. 304-A. It shall be the duty of every packer, stockyard owner, market agency, and dealer to comply with uniform rules and regulations prescribed by the Secretary relating to the weighing, fill, dockage, grading, and inspection of livestock in commerce. The Secretary shall provide for the inspection, through representatives of the Bureau of Animal Industry of the Department of Agriculture, of livestock sold in commerce at all of such stockyards."

SEC. 7. That section 308 (a) of said Act be, and hereby is, amended so as to read as follows:

"SEC. 308. (a) If any stockyard owner, market agency, or dealer violates any of the provisions of sections 304, 305, 306, 307, or 317, or of any order of the Secretary made under this title, he shall be liable to the person or persons injured thereby for the full amount of damages sustained in consequence of such violation.'

SEC. 8. 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, dealer, 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. 9. 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 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 section 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 two years.

"SEC. 318. (a) Whoever shall operate a stockyard which 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. 10. That section 401 of the Packers and Stockyards Act, 1921, is hereby amended so as to read as follows:

"SEC. 401. (a) From and after thirty days following the effective date of this Act, no stockyard owner, market agency, dealer, or packing plant, not registered with the Secretary, shall be permitted to so register or be registered as a stockyard owner, market agency, dealer, or packing plant, or to engage in or to carry on the business of a stockyard company, market agency, or dealer in commerce, or to operate in commerce as such packing plant, unless and until there shall first have been had and obtained from the Secretary a certificate that the present and future public convenience and necessity require, or will require, the operation of the business of such stockyard owner, market agency, or dealer, or the operation of such packing piant, as the case may be.

"(b) The application for and issuance of any such certificate and hearing held with respect thereto shall be under such rules and regulations as the Secretary may from time to time prescribe, and the provisions of this chapter shall apply to all such proceedings.

"(c) The Secretary shall have power to issue such certificate as prayed for or to refuse it and may attach to the issuance of such certificate such terms and conditions as in his judgment the public convenience and necessity may require. From and after the issuance of such certificate, and not before, the applicant therefor may, without securing approval other than such certificate, comply with the terms and conditions contained in or attached to the issuance of such certificate and proceed with the operations and conduct the business therein referred to. Any operation of the business of a packer, market agency, or dealer contrary to the provisions of this section may be enjoined by any court of competent jurisdiction at the suit of the United States, the Secretary, or any party in interest, and any person engaging in such business or person acting for or employed by such such person who knowingly authorizes and consents to or permits any violations of this section shall upon conviction thereof be liable to a penalty of not more than $500 for each such offense and not more than $250 each day it continues, which shall accrue to the United States and may be recovered in a civil action brought by the United States.

(d) Every packer, stockyard owner, market agency, and dealer shall keep such accounts, records, and memoranda as fully and correctly disclose all transactions involved in his business, including the true ownership of such business by stockholding or otherwise. The Secretary is authorized to require annual reports from all packers, stockyard owners, market agencies, and dealers subject to the provisions of this chapter. Such annual reports shall show in detail the amount of capital stock issued, if any; the amounts paid therefor and the manner of payment for the same; the earnings and receipts from each branch of business and from all sources; the operating and other expenses; the balances of profit and loss; and a complete exhibit of the financial operations of such packer, stockyard owner, market agency, or dealer each year, including an annual balance sheet. The Secretary shall at all times have access to all accounts, records, and memoranda, including all documents, papers, and correspondence, on the date that this Act becomes a law or thereafter existing and kept, or required to be kept, by packers, stockyard owners, market agencies, and dealers subject to this chapter. Whenever the Secretary finds that the accounts, records, and memoranda of any such person do not fully and correctly disclose all transactions involved in his business, the Secretary may prescribe the manner and form in which such accounts, records, and memoranda shall be kept, and thereafter any such person who fails to keep such accounts, records, and memoranda in the manner and form prescribed or approved by the Secretary shall upon conviction be fined not more than $5,000 or imprisoned not more than three years, or both.

"(e) When necessary to the efficient administration of the functions vested in the Secretary by this chapter, any employee or agent of the Secretary duly authorized in writing by the Secretary shall at all reasonable times, for this purpose of examination, have access to and the right to copy any book, account, record, paper, or correspondence relating to any matter which the Secretary is authorized to consider or investigate. Any person who upon demand refuses any duly authorized employee or agent of the Secretary such right of access or copying, or hinders, obstructs, or resists him in the exercise of such right, shall upon conviction

thereof be liable to a penalty of $500 for each such offense. Each day during any part of which such offense continues shall constitute a separate offense. Such penalty shall be recoverable in a civil suit brought in the name of the United States, and shall be covered into the Treasury of the United States as miscellaneous receipts.

"(f) Upon the application of the Attorney General of the United States, at the request of the Secretary, the district courts of the United States shall have jurisdiction to issue writs of mandamus commanding any packer, stockyard owner, market agency, or dealer to comply with the provisions of this section, of this Act, or any order of the Secretary made in pursuance thereof."

SEC. 11. 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. 12. 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 associations of producers of agricultural products" (42 Stat. L. 388).

SEC. 13. If any provision of this Act or the application thereof to any person or circumstance is held invalid, the validity of the remainder of the Act and of the application of such provision to other persons and circumstances shall not be affected thereby.

Senator Capper, you have a list of witnesses. Who is the first witness that you desire to appear?

Senator CAPPER. Mr. Chairman, I wish to make a statement rat in reference to the bill.

The CHAIRMAN. Senator Capper, please proceed.

Senator CAPPER. I will not take the time of the committee to discuss this measure, nor the evil it is designed to correct, in detail this morning. There are more than 2 dozen men here, representing farm organizations and farm groups and others directly affected. They have first had acquaintance with the situation which actually confronts the livestock industry, and their testimony will be much more informative and conclusive than anything that I can say.

The measure is not a new one. This committee approved a similar measure several years ago, when the evils of the private owned packer stockyards were just beginning to be understood by a few farsighted members of the livestock industry. The manipulation of prices on the central markets, which are very properly under Federal control and regulation, was pointed out at that time. The bill which I introduced, and which this committee approved at that time, was designed to correct the evil. Unfortunately, it did not become a law.

At that time a large percentage of the livestock producers did not believe that the privately owned yards were detrimental to producer interests. In fact, many producers believed that the privately owned and operated yards, which did not have the fixed charges against which they complained very properly at the central markets, would be a benefit to the producers by eliminating some of these charges.

It is true that the shipper escapes some charges and I want to say that the charges are a heavy item in the marketing of livestock, and in many instances cannot be justified.

But it has developed, just as we asserted that it would develop when these privately owned yards were in their inception, that the private yards and concentration points, unregulated, without proper