[Laws in effect as of January 24, 2002]
[Document not affected by Public Laws enacted between
January 24, 2002 and December 19, 2002]
[CITE: 7USC499b]
TITLE 7--AGRICULTURE
CHAPTER 20A--PERISHABLE AGRICULTURAL COMMODITIES
Sec. 499b. Unfair conduct
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.
(June 10, 1930, ch. 436, Sec. 2, 46 Stat. 532; Apr. 13, 1934, ch. 120,
Secs. 2, 3, 48 Stat. 585; June 19, 1936, ch. 602, Sec. 1, 49 Stat. 1533;
Aug. 20, 1937, ch. 719, Secs. 2-4, 50 Stat. 725, 726; June 29, 1940, ch.
456, Secs. 3, 4, 54 Stat. 696; Apr. 6, 1942, ch. 211, 56 Stat. 200; July
30, 1956, ch. 786, Sec. 1, 70 Stat. 726; Pub. L. 93-369, Aug. 10, 1974,
88 Stat. 423; Pub. L. 97-352, Sec. 1, Oct. 18, 1982, 96 Stat. 1667; Pub.
L. 98-273, Sec. 2, May 7, 1984, 98 Stat. 166; Pub. L. 104-48,
Secs. 9(b), 10, Nov. 15, 1995, 109 Stat. 430.)
Codification
Section was formerly classified to section 552 of this title.
Amendments
1995--Pub. L. 104-48, Sec. 9(b)(1), substituted ``commerce:'' for
``commerce--'' in introductory provisions.
Pars. (1) to (3). Pub. L. 104-48, Sec. 9(b)(2), substituted period
for semicolon at end.
Par. (4). Pub. L. 104-48, Sec. 9(b)(2), (3), substituted period for
semicolon after ``section 499e(c) of this title'' and inserted at end
``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.''
Par. (5). Pub. L. 104-48, Secs. 9(b)(2), 10, substituted ``foreign
commerce. However,'' for ``foreign commerce: Provided, That'',
substituted period for semicolon after ``miscellaneous receipts'', and
inserted at end ``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.''
Par. (6). Pub. L. 104-48, Sec. 9(b)(2), substituted period for
semicolon at end.
1984--Par. (4). Pub. L. 98-273 inserted ``or to fail to maintain the
trust as required under section 499e(c) of this title;''.
1982--Par. (5). Pub. L. 97-352 substituted ``Provided, That 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,'' for ``Provided, That any commission merchant, dealer, or
broker who has violated this paragraph may, with the consent of the
Secretary, admit the violation or violations and pay''.
1974--Par. (5). Pub. L. 93-369 inserted proviso for consent
admission of violations, payment of monetary penalty not in excess of
$2,000 in lieu of formal proceedings for suspension or revocation of
license, and for deposit of the payments into the Treasury of the United
States as miscellaneous receipts.
1956--Par. (5). Act July 30, 1956, struck out ``for a fraudulent
purpose'' after ``broker'', and included misrepresentation of region of
origin.
1942--Par. (4). Act Apr. 6, 1942, ins
