American National Growers Corporation

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IN THE MATTER A:\IERICAN NATIONAL GHOWERS CORPORATION, ET AL. CONSENT ORDER, ETC., IN REGARD TO THE ALLEGED VIOLATJON OF SEC. 2(c) OF THE CLAYTON ACT Docket 72-40. Complaint, Aug. 1.9.58-Decision, Feb. , 195.9 Consent order requiring a packer of fruits and vegetables under the " Blue Goose" and other labels with principal offce in Los Angeles, Calif.-doing a net business in IH56 of over $44 600 000-to cease violating Sec. 2(c) of the Clayton Act by paying the customary brokerage fee to brokers on direct sales for their own account for resale; and requiring three of its brokers to cease receiving or accepting such ilegal payments. COMPLAINT The Federal Trade Commission, having reason to believe that the parties respondent named in the caption hereof, and hereinafter more particularly designated and described, have been and are now violating the provisions of subsection (c) of Section 2 of the Clayton Act, as amended (D. , Title 15 , Sec. 13), hereby issues its complaint stating its chargeg with respect thereto as follows:

PARAGRAPH 1. Respondent American National Growers Corporation, hereinafter sometimes referred to as seller respondent or as respondent American, is a corporation organized, existing: and doing business under and by virtue of the laws of the Slate of Delaware, with its principal offce at 122 East Seventh Street Los Angeles, Calif., and having three principal operating branches known as Texas Division at Weslaco, Tex., vVcstern Division at Los Angeles, Calif. , and Eastern Division at Fort Pierce, Fla. Respondent American was knovv n as American National Foods Inc. from .January 1 , 1954 to August 13, 1956, and is engaged in the growing, packing and marketing of fresh fruits and vegetables. Its Eastern Division with offces located in Fort Pierce Fla., conducts growing, packing and marketing operations dealanding principally with Florida citrus, vegetables and melons, marketing operations with respect to peaches and apples. Respondent Ballentine Produce, Inc. is a corporation organized existing, and doing business under and by virtue of the laws of the State of Arkansas with its principal offce and place of business located on Highway 71 , North Alma, Ark. Ilesponrlent Ballentine Produce, Inc., hereinafter sometimes referred to as broker Complaint 55 F.

respondent, is engaged in business primarily as a distributor of fruits and vegetables and is directed and controlled by Harrell H. Ballentine, Herman Ballentine, and LuDell Ballcntine, who are responsible for its acts and practices. Respondent Harrell H. Ballentine is an individual doing business both as Harrell H. Ballentine, broker, and as president of Ballentine Produce, Inc. with an office on Highway 71 , North Alma, Ark., hereinafter sometimes referred to as broker respondent. Respondent Herman Bal1entine is an individual with an offce located on Highway 71 Korth Alma, Ark., and is vice president of respondent Ballentine Produce, Inc. Respondent LuDell Ballentine is an individual with an offce located on Highway 71 , North Alma, Ark. , and is secretary-treasurer of respondent Ballentine Produce, Inc. Respondent IIug-h B. Campbell, Inc. is a corporation organized, existing, and doing business under and by virtue of the laws of the State of Oregon with its principal offce and place of business located at 234 SE. Alder Street, Portland, Oreg. Respondent Hug-h R. Campbell, Inc. is eng-ag-ed iu business as a broker and distributor of fresh fruits and vegetables and is hereinafter sometimes referred to as broker respondent, and is directed and controlled by respondents Hugh B. Campbell, Hobert Hccken and Mary A. Campbell who are responsible for its acts and practices. Respondent Hugh R. Campbell is an individual with an offce located at 234 SE. Alder Street, Portland, Oreg-. , and is presideut of respondent Hugh B. Campbell, Inc. Respondent Robert Recken is an individual with an offce located at 234 SE. Alder Street Portland, Oreg. , and is vice president of respondent Hugh B. Campbell, Inc. Respondent Mary A. Campbell is an individual with an offce located at 234 SE. Alder Street, Portland, Oreg. and is secretary-treasurer of respondent Hugh B. Campbell, Inc. Respondents Oscar L. Davis, Jr. and Mrs. Oscar L. Davis, Sr. are individuals with of1ices located at 2426 West 13th Street Chattanooga, Tenn., doing business as an equal partnership tnlcling as O. L. Davis Brokerage Company, and are engaged in business as brokers of citrus fruits, potatoes, onions, apples and seed potatoes, and they are hereinafter sometimes referred to as broker respondents.

PAR. 2. Respondent American is now, and for several years past has been, selling fruits and vegetables under the "Blue Goose" and other labels and has been acting as selling agent for other packers and g-rowcrs of citrus fruits and vegetables. Respondent American sells and distributes these food products AMERICAN NATIONAL GROWERS CORP. ET AL. 1323 1321 Complaint throughout the United States directly to buyers without the intervention of brokers, and to buyers through brokers who represent it in effecting such sales, and for the services of these brokers, respondent American pays them a brokerage fee or commission ranging from 5f to J Of per box. Respondent American is a substantial factor in tbe sale and distribution of fruits and vegetables and its net sales of an products during the year 1956 amounted to over $'14, 600 000 , over $17,000 000 of which were made by its Eastern Division.

The broker respondeJits named herein are now, and for the past several years have been, engaged in the brokerage business representing various principals located throughout the United States. One of the principals represented by these broker respondents is the sener respondent American named berein. In representing respondent American in the sale of fruit and vegetable products, they were and are paid for their services a brokerage fee or commission ranging from 50 to lof per box. PAR. 3. In the course and conduct of its business in commerce as "commerce" is defined in the aforesaid Clayton Act, respondent American has been for the past several years and is now sellng and distributing fruit and vegetable products to buyers located in the several states of the United States, and has transported or caused such products, when sold, to be transported from its place of business in Fort Pierce, Fla. , or from other places within said State, to buyers located in the various States of the linited States other than the State of Florida. There is and has been at aJl times mentioned herein, a continuous course of trade in commerce in said fruit and vegetable products across state lines between respondent American and the respective buyers of said fruit and vegetable products, including the broker respondents named herein.

In the course and conduct of their business in commerce, as commerce" is defined in the aforesaid Clayton Act, tbe broker respondents named herein have been and arc now selling and distributing fruit and vegetable products for their principal1s located in tbe various States of the United States other than the States in which the broker respondents are located. Said respondents have transported, or caused said fruit and vegetable products, when sold, to be transported from their principals places of business to said buyers ' places of business located in other States, or to their customers located therein. There is and 1324 FEDERAL TRADE COMMISSIOK DECISIONS Decision 55 F.

has been at all times mentioned herein, a continuous course of trade in commerce in the sale of said fruit products across State lines between the broker respondents and their respective principals, including respondent American.

PAR. 4. In some instances respondent American makes direct sales to some, but not all, of its brokers for their own account for resale, on "vhieh sales respondent American pays or grants directly or indirectly, a commission or brokerage, or an allowance or discount in lieu thereof, to said brokers. The broker respondents named herein are some of the brokers who have made a number of such purchases for their own accounts from respondent American, on I"hieh purchases they received and accepted, directly or indirectly, said commission or brokerage, or allowances or discounts in lieu thereof, from seller respondent American.

PAR. 5. The acts and practices of seller respondent American in paying, granting, or allowing, directly or indirectly, something of value as a commission, brokerage, or other compensation or an allowance or discount in lieu thereof, on sales of fruit and vegetable products to the broker respondents for their o\\'n accounts as alleged and c1e. cribccl above, a11l the acts and practices of the broker respondents in receiving and accept.n, directly or indirectly?, something of value as a commission, urokerage, or other Coml)ensatiol1 , or an allmvance or discount in lieu thereof, on theil' purchases of fruit and vegetable products as herein aI1cgecl and described, are each in violation of subsection (c) of Section 2 of the Clayton Act as amended (t;. , Title 15, Sec. 13).

1111' Fredric T . 5u88 for the Commission. ,.. Har,.y S. D1!nmirr of Pittsburgh, Fa., for American National Growers Corporation.

,.. Rouert L. Reeke)) of Portland, Oreg., for Hugh B. Campbell, Inc. , Hugh B. Campbell, Hobert Heeken, am1 :\lnry A. Camp hell.

:\ 0 appearance for other respondents.

INITIAL DECISIO:: BY WILLIAM L. PACK , HEARI:-C EXAMINER The complaint in t.his matter charges the respondents ,ovith violation of Section 2 (c) of the Clayton Act, as amended by the Robinson-Patman Act. An agreement for disposition of the pro- AMERICAN NATIONAL GROWERS CORP. ET AL. 1325 1321 Decision ceeding by means of a consent order has now been entered into by counsel supporting the complaint, and all of the respondents except Mrs. Oscar L. Davis, Sr., who is deceased. Tbe term respondents as used hereinafter will not include this individual. The ag-reement provides, among- other things, that respondents admit all of tbe jurisdictional alleg-ations in the complaint; that the record on which the initial decision and the decision of the Commission sball be based shall consist solely of the complaint and agreement; that the inclusion of findings of fact and conclusions of law in the decision disposing of this matter is waived, togetber with any further procedural steps before the hearing examiner and the Commiss-jon; that the Dreier hereinafter set forth may be entered in disposition of the proceeding, sucb order to have the same force and effect as if entered after a full hearing, respondents specifically waiving any and all rights to challenge or contest the validity of such order; that the order may be altered, modified, or set aside in the manner provided for other orders of the Commission; that the complaint may be used in construing the terms of the order; and that the agreement is for settlement purposes only and does not constitute an admission by respondents that they have violate(l the law as alleged in the complaint.

The hearing examiner having considered the agreement and proposed order and being of the opinion that they provide an adequate basis for appropriate disposition of the proceeding, the agreement is hereby ac:ceptec1, the following jurisdictional findings made, and the following order issued: 1. Respondent American i\ational Growers Corporation is a corporation organized, existing and doing business under the laws of the State of Delaware, with its principal offce at 122 East Seventh Street, Los Angeles, Calif. , and its three operating branches at Fort Pierce, Fla. ; \VesJaco, Tex. ; and Los Angeles Calif.

Respondent Ballentine Produce, Jnc. , is a corporation organized, existing and doing business under and by virtue of th( laws of the State of Arkansas, with its principal oflce and place of business located on High,vay 71 , North Alma, Ark. , and it is directed and controlled by respondents Harrell 11 Ballentine, Herman Ballentine, and Ludell Ballentine, who are responsible for its ads and practices and a11 of whom have offices located on Highway 71 , North Alma, Ark. Respondent Harrell H. BaJlentine is an individual doing business both as Harrell H. Ballentine 1326 EDERAL TRADE COMMISSION DECISIONS Order 55 F.

broker, and as president of Ballentine Produce, Inc. Respondent Herman Ballentine is an individual and is vice president of respondent Ballentine Produce, Inc. Respondent Ludell Ballentine is an individual and is secretary-treasurer of respondent Ballentine Produce, Inc.

Respondent Hugh B. Campbell, Inc. , is a corporation organized existing and doing business under the laws of the State of Oregon with its principal offce and place of business located at 234 SE. Alder Street, Portland, Oreg. , and is directed and controlled by respondents Hugh B. Campbell, Robert Recken and Mary A. Campbell, wbo are responsible for its acts and practices and all of whom have offces located at 234 Southeast Alder Street, Portland, Oreg. Respondent Hugh B. Campbell is an individual and president of respondent Hugh B. Campbell, Inc. Respondent Robert Recken is an individual and is vice president of respondent Hugh B. Campbell, Inc. Respondent Mary A. Campbell is an individual and is secretary treasurer of respondent Hugh B. Campbell, Inc.

Respondent Osear L. Davis, Jr. , is an individual with offce located at 2426 West 13th Street, Chattanooga, Tenn. , doing business as O. L. Davis Brokeragc Company. 2. The Federal Trade Commission bas jurisdiction of the subject matter of this proceeding and of the respondents. ORDER It is ordered That the respondent, American National Growers Corporation, a corporation, and its offcers, representatives, agents and employees, directly or indirectly, or througb any corporate or other device, in connection with the sale of fruits, fruit products or vegetables in commerce, as "commerce " is defined in the aforesaid Clayton Act, do forthwith cease and desist from: 1. Paying, granting, or allowing, directly or indirectly, to any buyer, or to anyone acting for or in behalf of, or who is subject to the direct or indirect control of such buyer, anytbing of value as a commission, brokerage, or other compensation, or any allowance or discount in heu thereof, upon or in connection with any sale of its said products to such buyer for his own account; 2. Selling any of said products to a buyer at a price reflecting a reduction from the price at which sales of such products are currently being made by respondent to others, where such reduction is in lieu of brokerage or any part or percentage thereof. AMERICAN ;-ATIONAL GROWERS CORP. ET AL. 1327 1321 Dccision It is fUTtheT o,.dated That respondents Ba1lentine Produce Inc., a corporation, and Hugh B. Camphe1l, Inc. , a corporation their offcers, and respondents Harre1l H. BaIJentine, Herman Ba1lentine, and Lude1l Ba1lentine, individual1ly and as offcers of Ba1lentine Produce, Inc. , Hugb B. Campbell, Robert Recken and Mary A. Campbell, individual1ly and as offccrs of Hugh B. Campbell, Inc., Oscar L. Davis, Jr., individual1ly and trading as O. L. Davis Brokerage Company, or trading under any other name and their respective representatives, agents and employees, directly or through any corporate or other device in connection with the purchase of food products in commerce, as "commerce is defined in the aforcsaid Clayton Act, do forthwith cease and desist from:

Receiving or accepting, directly or indirectly, from any seller anything. of value as a commission, brokerage or other compensation, or any allowance or discount in lieu thereof, upon any purchase of food products by or for their own accounts or for tbe account of any buyer for whom they are individual1ly or collectively acting as agents, representatives or intermediaries who are subject to the direct control of said buyer. It 'is further onlered That the complaint bc and it hereby is dismissed as to respondent Mrs. Oscar L. Davis, Sr. DECISION OF THE COMMISSION AND ORDER TO FILE REPORT OF COMPLIANCE Pursuant to Section 3.21 of the Commission s Rules of Practice, the initial decision of the hearing examiner shall, on the 26t.h day of February 1959, become tbe decision of tbe Commissian; and, accordingly:

It is ordered That respondents American National Growers Corporation: BaIJcntinc Produce, Inc. ; Hugh B. Campbell, Inc. Harre1l H. BaIJentine; Herman Ba1lentine; LudelJ Ba1lentine; Hugh B. Campbell; Robert Hecken; Mary A. Campbell; and Oscar L. Davis, Jr. , shall, within sixty (60) days after service upon them of this order, file with the Commission a report in writing setting fortb in detail the manner and form in which they have complied with the order to cease and desist. 1328 FEDERAL TRADE COM"IISSION DECISIONS Decision 55 F.