7 U.S.C. § 217b — Statutory trust established; dealer

Page 346 TITLE 7—AGRICULTURE § 217a of the Board, or Secretary of Transportation, as appro- priate, see section 205 of Pub. L. 104–88, set out as a note under section 1301 of Title 49. § 217a. Fees for inspection of brands or marks (a) Authorization by Secretary; registration as market agency The Secretary may, upon written application made to him, and if he deems it necessary, au- thorize the charging and collection, at any stockyard subject to the provisions of this chap- ter, by any department or agency of any State in which branding or marking or both branding and marking livestock as a means of estab- lishing ownership prevails by custom or statute, or by a duly organized livestock association of any such State, of a reasonable and nondiscrim- inatory fee for the inspection of brands, marks, and other identifying characteristics of live- stock originating in or shipped from such State, for the purpose of determining the ownership of such livestock. No charge shall be made under any such authorization until the authorized de- partment, agency, or association has registered as a market agency. No more than one such au- thorization shall be issued with respect to such inspection of livestock originating in or shipped from any one State. If more than one such appli- cation is filed with respect to such inspection of livestock originating in or shipped from any one State, the Secretary shall issue such authoriza- tion to the applicant deemed by him best quali- fied to perform the proposed service, on the basis of (1) experience, (2) financial responsi- bility, (3) extent and efficiency of organization, (4) possession of necessary records, and (5) any other factor relating to the ability of the appli- cant to perform the proposed service. The Sec- retary may receive and consider the rec- ommendations of the commissioner, secretary, or director of agriculture, or other appropriate officer or agency of a State as to the qualifica- tions of any applicant in such State. The deci- sion of the Secretary as to the applicant best qualified shall be final. (b) Applicability of section The provisions of this subchapter, relating to the filing, publication, approval, modification, and suspension of any rate or charge for any stockyard service shall apply with respect to charges authorized to be made under this sec- tion. (c) Collection and payment of charges Charges authorized to be made under this sec- tion shall be collected by the market agency or other person receiving and disbursing the funds received from the sale of livestock with respect to the inspection of which such charge is made, and paid by it to the department, agency, or as- sociation performing such service. (d) Revocation of authorization or registration The Secretary may, if he deems it to be in the public interest, suspend, and after hearing, re- voke any authorization and registration issued under the provisions of this section or any simi- lar authorization and registration issued under any other provision of law. The order of the Sec- retary suspending or revoking any such author- ization and registration shall not be subject to review. (Aug. 15, 1921, ch. 64, title III, § 317, as added June 19, 1942, ch. 421, 56 Stat. 372.) Editorial Notes PRIOR PROVISIONS Former provisions relating to fees for inspection of brands appearing upon livestock were contained in sec- tion 231 of this title. Statutory Notes and Related Subsidiaries ADMINISTRATIVE ORDERS REVIEW ACT Court of appeals exclusive jurisdiction respecting final orders of Secretary of Agriculture under this chapter, except orders issued under section 210(e) of this title and this section, see section 2342 of Title 28, Judiciary and Judicial Procedure. § 217b. Statutory trust established; dealer (a) Establishment (1) In general All livestock purchased by a dealer in cash sales and all inventories of, or receivables or proceeds from, such livestock shall be held by such dealer in trust for the benefit of all un- paid cash sellers of such livestock until full payment has been received by such unpaid cash sellers. (2) Exemption Any dealer whose average annual purchases of livestock do not exceed $100,000 shall be ex- empt from the provisions of this section. (3) Effect of dishonored instruments For purposes of determining full payment under paragraph (1), a payment to an unpaid cash seller shall not be considered to have been made if the unpaid cash seller receives a payment instrument that is dishonored. (b) Preservation of trust An unpaid cash seller shall lose the benefit of a trust under subsection (a) if the unpaid cash seller has not preserved the trust by giving writ- ten notice to the dealer involved and filing such notice with the Secretary— (1) within 30 days of the final date for mak- ing a payment under section 228b of this title in the event that a payment instrument has not been received; or (2) within 15 business days after the date on which the seller receives notice that the pay- ment instrument promptly presented for pay- ment has been dishonored. (c) Notice to lien holders When a dealer receives notice under sub- section (b) of the unpaid cash seller’s intent to preserve the benefits of the trust, the dealer shall, within 15 business days, give notice to all persons who have recorded a security interest in, or lien on, the livestock held in such trust. (d) Cash sales defined For the purpose of this section, a cash sale means a sale in which the seller does not ex- pressly extend credit to the buyer. (e) Purchase of livestock subject to trust (1) In general A person purchasing livestock subject to a dealer trust shall receive good title to the livestock if the person receives the livestock— Page 347 TITLE 7—AGRICULTURE § 222 (A) in exchange for payment of new value; and (B) in good faith without notice that the transfer is a breach of trust. (2) Dishonored payment instrument Payment shall not be considered to have been made if a payment instrument given in exchange for the livestock is dishonored. (3) Transfer in satisfaction of antecedent debt A transfer of livestock subject to a dealer trust is not for value if the transfer is in satis- faction of an antecedent debt or to a secured party pursuant to a security agreement. (f) Enforcement Whenever the Secretary has reason to believe that a dealer subject to this section has failed to perform the duties required by this section or whenever the Secretary has reason to believe that it will be in the best interest of unpaid cash sellers, the Secretary shall do one or more of the following— (1) appoint an independent trustee to carry out the duties required by this section, pre- serve trust assets, and enforce the trust; (2) serve as independent trustee, preserve trust assets, and enforce the trust; or (3) file suit in the United States district court for the district in which the dealer re- sides to enjoin the dealer’s failure to perform the duties required by this section, preserve trust assets, and to enforce the trust. Attor- neys employed by the Secretary may, with the approval of the Attorney General, represent the Secretary in any such suit. Nothing herein shall preclude unpaid sellers from filing suit to preserve or enforce the trust. (Aug. 15, 1921, ch. 64, title III, § 318, as added Pub. L. 116–260, div. N, title VII, § 763, Dec. 27, 2020, 134 Stat. 2114.) SUBCHAPTER IV—LIVE POULTRY DEALERS AND HANDLERS §§ 218 to 218d. Repealed. Pub. L. 100–173, § 10, Nov. 23, 1987, 101 Stat. 922 Section 218, act Aug. 15, 1921, ch. 64, title V, § 501, as added Aug. 14, 1935, ch. 532, 49 Stat. 648, stated necessity to curb unfair, deceptive, and fraudulent practices re- lating to live poultry. Section 218a, act Aug. 15, 1921, ch. 64, title V, § 502, as added Aug. 14, 1935, ch. 532, 49 Stat. 648, authorized Sec- retary to designate cities and markets where unfair practices exist, to require licensing, and to prescribe information to be contained in application license, and authorized penalty for dealing without license. Section 218b, act Aug. 15, 1921, ch. 64, title V, § 503, as added Aug. 14, 1935, ch. 532, 49 Stat. 649, defined ‘‘live poultry dealer’’. Section 218c, act Aug. 15, 1921, ch. 64, title V, § 504, as added Aug. 14, 1935, ch. 532, 49 Stat. 649, related to appli- cation of other provisions of this chapter to this sub- chapter and posting of rates, charges, and rentals in li- censee’s place of business. Section 218d, act Aug. 15, 1921, ch. 64, title V, § 505, as added Aug. 14, 1935, ch. 532, 49 Stat. 649, related to sus- pension and revocation of licenses. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF REPEAL Repeal effective 90 days after Nov. 23, 1987, see section 12 of Pub. L. 100–173, set out as an Effective Date of 1987 Amendment note under section 182 of this title. SUBCHAPTER V—GENERAL PROVISIONS § 221. Accounts and records of business; punish- ment for failure to keep Every packer, any swine contractor, and any live poultry dealer, stockyard owner, market agency, and dealer shall keep such accounts, records, and memoranda as fully and correctly disclose all transactions involved in his busi- ness, including the true ownership of such busi- ness by stockholding or otherwise. 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. (Aug. 15, 1921, ch. 64, title IV, § 401, 42 Stat. 168; Aug. 15, 1921, ch. 64, title V, § 503, as added Aug. 14, 1935, ch. 532, 49 Stat. 649; Pub. L. 100–173, § 6, Nov. 23, 1987, 101 Stat. 918; Pub. L. 107–171, title X, § 10502(b)(2)(C), May 13, 2002, 116 Stat. 510.) Editorial Notes AMENDMENTS 2002—Pub. L. 107–171 inserted ‘‘any swine contractor, and’’ after ‘‘packer,’’. 1987—Pub. L. 100–173 substituted ‘‘, any live poultry dealer,’’ for ‘‘or any live poultry dealer or handler,’’. 1935—Act Aug. 15, 1921, title V, § 503, as added Aug. 14, 1935, inserted ‘‘or any live poultry dealer or handler’’ after ‘‘packer’’ wherever appearing. Statutory Notes and Related Subsidiaries EFFECTIVE DATE OF 1987 AMENDMENT Amendment by Pub. L. 100–173 effective 90 days after Nov. 23, 1987, see section 12 of Pub. L. 100–173, set out as a note under section 182 of this title. LIENS OR SECURITY INTERESTS AGAINST LIVESTOCK; INTERAGENCY TASK FORCE TO RECOMMEND METHOD OF PROVIDING INFORMATION TO PURCHASERS; REPORT TO CONGRESS Pub. L. 95–409, § 2, Oct. 2, 1978, 92 Stat. 887, required the Secretary of Agriculture to appoint a task force to recommend methods of providing information to pur- chasers of livestock concerning the existence of a lien or security interest against livestock and to submit a report to Congress not later than Feb. 1, 1979. § 222. Federal Trade Commission powers adopted for enforcement of chapter For the efficient execution of the provisions of this chapter, and in order to provide informa- tion for the use of Congress, the provisions (in- cluding penalties) of sections 46 and 48 to 50 of title 15, are made applicable to the jurisdiction, powers, and duties of the Secretary in enforcing the provisions of this chapter and to any person subject to the provisions of this chapter, wheth- er or not a corporation. The Secretary, in person or by such agents as he may designate, may prosecute any inquiry necessary to his duties under this chapter in any part of the United States.