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7 U.S.C. § 499bUnfair conduct

submitted 96 years ago by ch. 436 to r/title-7-AGRICULTURE · 701 words · no verdicts yet

in plain englishAI-generated · not legal advice

This law bans unfair, dishonest, or fraudulent practices by produce dealers, brokers, and commission merchants. They can't cheat on weighing produce, wrongly reject deliveries, dump goods, lie, or misrepresent quality or origin. They also can't tamper with inspection tags or swap goods after official grading.

This section lists seven kinds of unfair conduct that are illegal in interstate or foreign commerce transactions in perishable agricultural commodities. (1) A commission merchant, dealer, or broker may not use any unfair, unreasonable, discriminatory, or deceptive practice when weighing, counting, or otherwise figuring out the quantity of a perishable agricultural commodity that is received, bought, sold, shipped, or handled in interstate or foreign commerce. (2) A dealer may not reject or fail to deliver a perishable agricultural commodity as the contract requires, without reasonable cause, when that commodity was bought, sold, or contracted to be bought, sold, or consigned in interstate or foreign commerce. (3) A commission merchant may not discard, dump, or destroy a perishable agricultural commodity it received in interstate or foreign commerce, without reasonable cause. (4) A commission merchant, dealer, or broker may not, for a fraudulent purpose, make a false or misleading statement about a transaction involving a perishable agricultural commodity. They also may not fail or refuse to truly and correctly account for, and promptly pay in full for, such a transaction. They may not fail, without reasonable cause, to carry out any duty — stated or implied — that comes from the transaction. And they may not fail to keep the trust required under section 499e(c) of this title. However, this paragraph does not make it illegal, by itself, to offer, ask for, pay, or receive collateral fees and expenses in good faith. (5) A commission merchant, dealer, or broker may not misrepresent — by word, act, mark, stencil, label, statement, or deed — the character, kind, grade, quality, quantity, size, pack, weight, condition, ripeness, or place of origin of a perishable agricultural commodity that is received, shipped, sold, or offered for sale in interstate or foreign commerce. But there's an exception: someone who violates this paragraph may admit the violation with the Secretary's consent (A); or, if the violation involves misrepresentation by mark, stencil, or label and is not repeated or flagrant, the Secretary must let them admit it (B). Either way, they can pay a penalty of up to $2,000 instead of going through a formal proceeding to suspend or revoke their license. That payment goes to the Treasury as miscellaneous receipts. A person who is not the first licensee to handle mislabeled produce is not liable under this paragraph for someone else's violation, if they didn't know about it or couldn't have fixed it. (6) A commission merchant, dealer, or broker may not, for a fraudulent purpose, remove, alter, or tamper with a card, stencil, stamp, tag, or other notice on a container or railroad car holding a perishable agricultural commodity, if that notice carries a certificate or statement — under a federal or state inspector's authority, or under federal or state law or regulation — about the grade, quality, or origin state or country of the commodity inside. (7) A commission merchant, dealer, or broker may not, without an inspector's consent, make, cause, or allow any change — by substitution or otherwise — to the contents of a load or lot of a perishable agricultural commodity after it has been officially inspected for grading and certification. This does not stop them from re-sorting the load and throwing out inferior produce.
the actual law source: uscode.house.gov ↗public domain

It shall be unlawful in or in connection with any transaction in interstate or foreign commerce:

(1)

For any commission merchant, dealer, or broker to engage in or use any unfair, unreasonable, discriminatory, or deceptive practice in connection with the weighing, counting, or in any way determining the quantity of any perishable agricultural commodity received, bought, sold, shipped, or handled in interstate or foreign commerce.

(2)

For any dealer to reject or fail to deliver in accordance with the terms of the contract without reasonable cause any perishable agricultural commodity bought or sold or contracted to be bought, sold, or consigned in interstate or foreign commerce by such dealer.

(3)

For any commission merchant to discard, dump, or destroy without reasonable cause, any perishable agricultural commodity received by such commission merchant in interstate or foreign commerce.

(4)

For any commission merchant, dealer, or broker to make, for a fraudulent purpose, any false or misleading statement in connection with any transaction involving any perishable agricultural commodity which is received in interstate or foreign commerce by such commission merchant, or bought or sold, or contracted to be bought, sold, or consigned, in such commerce by such dealer, or the purchase or sale of which in such commerce is negotiated by such broker; or to fail or refuse truly and correctly to account and make full payment promptly in respect of any transaction in any such commodity to the person with whom such transaction is had; or to fail, without reasonable cause, to perform any specification or duty, express or implied, arising out of any undertaking in connection with any such transaction; or to fail to maintain the trust as required under section 499e(c) of this title. However, this paragraph shall not be considered to make the good faith offer, solicitation, payment, or receipt of collateral fees and expenses, in and of itself, unlawful under this chapter.

(5)

For any commission merchant, dealer, or broker to misrepresent by word, act, mark, stencil, label, statement, or deed, the character, kind, grade, quality, quantity, size, pack, weight, condition, degree of maturity, or State, country, or region of origin of any perishable agricultural commodity received, shipped, sold, or offered to be sold in interstate or foreign commerce. However, any commission merchant, dealer, or broker who has violated—

(A)

any provision of this paragraph may, with the consent of the Secretary, admit the violation or violations; or

(B)

any provision of this paragraph relating to a misrepresentation by mark, stencil, or label shall be permitted by the Secretary to admit the violation or violations if such violation or violations are not repeated or flagrant;

and pay, in the case of a violation under either clause (A) or (B) of this paragraph, a monetary penalty not to exceed $2,000 in lieu of a formal proceeding for the suspension or revocation of license, any payment so made to be deposited into the Treasury of the United States as miscellaneous receipts. A person other than the first licensee handling misbranded perishable agricultural commodities shall not be held liable for a violation of this paragraph by reason of the conduct of another if the person did not have knowledge of the violation or lacked the ability to correct the violation.

(6)

For any commission merchant, dealer, or broker, for a fraudulent purpose, to remove, alter, or tamper with any card, stencil, stamp, tag, or other notice placed upon any container or railroad car containing any perishable agricultural commodity, if such card, stencil, stamp, tag, or other notice contains a certificate or statement under authority of any Federal or State inspector or in compliance with any Federal or State law or regulation as to the grade or quality of the commodity contained in such container or railroad car or the State or country in which such commodity was produced.

(7)

For any commission merchant, dealer or broker, without the consent of an inspector, to make, cause, or permit to be made any change by way of substitution or otherwise in the contents of a load or lot of any perishable agricultural commodity after it has been officially inspected for grading and certification, but this shall not prohibit re-sorting and discarding inferior produce.

Source credit: (June 10, 1930, ch. 436, § 2, 46 Stat. 532; Apr. 13, 1934, ch. 120, §§ 2, 3, 48 Stat. 585; June 19, 1936, ch. 602, § 1, 49 Stat. 1533; Aug. 20, 1937, ch. 719, §§ 2–4, 50 Stat. 725, 726; June 29, 1940, ch. 456, §§ 3, 4, 54 Stat. 696; Apr. 6, 1942, ch. 211, 56 Stat. 200; July 30, 1956, ch. 786, § 1, 70 Stat. 726; Pub. L. 93–369, Aug. 10, 1974, 88 Stat. 423; Pub. L. 97–352, § 1, Oct. 18, 1982, 96 Stat. 1667; Pub. L. 98–273, § 2, May 7, 1984, 98 Stat. 166; Pub. L. 104–48, §§ 9(b), 10, Nov. 15, 1995, 109 Stat. 430.)

history & why it existsrecord from the source credit
  • 1930Enacted · Act of June 10, 1930, ch. 436 · 46 Stat. 532
  • 1934Amended · Act of Apr. 13, 1934, ch. 120 · 48 Stat. 585
  • 1936Amended · Act of June 19, 1936, ch. 602 · 49 Stat. 1533
  • 1937Amended · Act of Aug. 20, 1937, ch. 719 · 50 Stat. 725, 726
  • 1940Amended · Act of June 29, 1940, ch. 456 · 54 Stat. 696
  • 1942Amended · Act of Apr. 6, 1942, ch. 211 · 56 Stat. 200
  • 1956Amended · Act of July 30, 1956, ch. 786 · 70 Stat. 726
  • 1974Amended · Pub. L. 93-369 · 88 Stat. 423
  • 1982Amended · Pub. L. 97-352 · 96 Stat. 1667
  • 1984Amended · Pub. L. 98-273 · 98 Stat. 166
  • 1995Amended · Pub. L. 104-48 · 109 Stat. 430

A history note hasn’t been published yet. The record shows enactment by ch. 436 on 1930-06-10.

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