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Commodity Futures Trading Commission 

CEA CASES 

NAME: GEORGE SIROTA AND SONS, GEORGE SIROTA, NORMAN L. SIROTA, BENJAMIN SIROTA, 

HARRY A. ASPINWALL, AND DYKE CULLUM 

CITATION: 14 Agric. Dec. 643 

DOCKET NUMBER: 54 

DATE: AUGUST 29, 1955 

DOCUMENT TYPE: DECISION AND ORDER 

(No. 4339) 

In re GEORGE SIROTA AND SONS, GEORGE SIROTA, NORMAN L. SIROTA, BENJAMIN SIROTA, 

HARRY A. ASPINWALL, AND DYKE CULLUM. CEA Docket No. 54. Decided August 29, 

1955. 

Suspension of Registration Held in Abeyance -- Jurisdiction of Secretary -- 

Separate Legal Entity

Where an order was entered suspending the registration of a partnership and 

the registrations of the individual partners but, subsequent to the entry of the 

order, complainant filed a motion requesting that the order also apply to a new 

partnership composed of the same partners and formed after issuance of the 

referee's report, and the effective date of the suspension was postponed pending 

consideration of the motion, held the issuance of a final order did not deprive 

the Secretary of jurisdiction over the proceeding because the order had not 

become effective by its terms when the motion was filed and when the sanction 

order was postponed, and the defense that the new partnership is a separate 

legal entity is of no avail as the record shows that the two partnerships are 

comprised of the same partners and have the same office and a common payroll and 

the order cannot be defeated by the same partners setting up another 

partnership, and the suspension of registration should apply to both 

partnerships, such suspension to be held in abeyance and not become effective 

unless, after notice and hearing, respondents should be found to have violated 

the act or regulations thereunder within two years. 

Mr. Benjamin M. Holstein for Commodity Exchange Authority. Mr. Ben I. 

Melnicoff, of Washington, D. C., for respondents. Mr. John Curry, Referee. 

Decision by Thomas J. Flavin, Judicial Officer

PRELIMINARY STATEMENT

On July 31, 1953, an order was entered in this proceeding suspending the 

registration of the respondent partnership George Sirota and Sons as a futures 

commission merchant and the registrations of the respondents Norman L. Sirota, 

Benjamin Sirota and Harry A. Aspinwall as floor brokers, and directing the 

denial of trading privileges to Dyke Cullum, all sanctions to run for a period 

of ten days. Subsequent to the entry of the order, the complainant filed a 

motion requesting that the Judicial Officer issue a supplemental order stating 

that the order of suspension of the registration of George Sirota and Sons which 

was to become effective September 1, 1953, would also apply to Sirota and 

Company, a new partnership formed and registered as a futures commission 

merchant after issuance of the referee's report. It was alleged that this new 

partnership consisted of the same four individuals who were partners of George 

Sirota and Sons. On 
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August 26, 1953, the Judicial Officer postponed the effective date of the 

suspension of George Sirota and Sons as a futures commission merchant pending 

action on this motion. The suspensions of the registrations of respondents 

Norman L. Sirota, Benjamin Sirota and Harry A. Aspinwall as floor brokers and 

the order denying trading privileges to Dyke Cullom became effective September 

1, 1953, and expired ten days later. 

The Sirota respondents filed a memorandum in opposition to the complainant's 

motion and an order was entered on January 14, 1954, referring the proceeding 

back to the Office of Hearing Examiners for the purpose of putting into the 

record, by hearing or stipulation, or both, evidence "as to whether the sanction 

ordered against George Sirota and Sons should apply to Sirota and Company." The 

referee, John Curry, Office of Hearing Examiners, issued a notice reopening the 

hearing for this purpose, and the matter was duly heard in New York, New York, 

on February 8, 1954. Benjamin M. Holstein appeared as attorney for the 

complainant. Ben I. Melnicoff, Attorney at Law, Washington, D. C., appeared for 

the Sirota respondents. At the hearing the complainant introduced exhibits 

consisting of applications for registration as futures commission merchants 

filed by George Sirota and Sons and Sirota and Company. These exhibits show the 

composition of the two firms. Benjamin Sirota testified on direct examination 

as to the reasons why and the circumstances under which Sirota and Company was 

organized. This witness testified on cross-examination that Sirota and Company 

consisted of his father George Sirota, his brother Norman L. Sirota, his 

brother-in-law Laurence H. Taylor, and himself, and that these four individuals 

comprised the firm of George Sirota and Sons, the only difference being that 

George Sirota was a general partner in George Sirota and Sons and a limited 

partner in Sirota and Company. He also testified that both firms used the same 

office and that Sirota and Company paid the salaries of all persons connected 

with both firms. 

FINDINGS OF FACT

1. At the time of the institution of this proceeding, respondent partnership 

George Sirota and Sons consisted of respondents George Sirota and his two sons, 

Norman L. Sirota and Benjamin Sirota. Effective January 1, 1952, Laurence H. 

Taylor, not a respondent herein, became a partner in respondent George Sirota 

and Sons. 

2. The referee's report in this proceeding was filed March 12, 1952. The 

referee recommended in his report that an order be issued requiring the contract 

markets to refuse all trading privileges to the respondents for a period of ten 

days. On March 24, 1952, prior to the issuance of the Judicial Officer's 

decision and order, a firm designated as Sirota and Company applied for 

registration and was registered as a futures commission merchant under the 

Commodity Exchange Act for the balance of the calendar year 1952. Sirota and 

Company was shown to be a partnership composed of the aforesaid Norman L. 

Sirota, the aforesaid Benjamin Sirota, the aforesaid Laurence H. Taylor, and one 

Carl E. Preston, all general partners, and the aforesaid George Sirota, a 

limited partner. The firm was organized on April 1, 1952. The registration of 

Sirota and Company as a futures commission merchant was renewed for the calendar 

year of 1953, the composition of the firm remaining unchanged until June 10, 

1953, when Sirota and Company notified the Commodity Exchange Authority that 

Carl E. Preston had severed his connection with the firm. The registration of 

George Sirota and Sons was also renewed for 1953. Subsequently, Sirota and 

Company renewed its registration for the calendar year 1954, the application 

showing the firm to consist of the aforesaid Benjamin Sirota, the aforesaid 

Norman L. Sirota, the aforesaid Laurence H. Taylor, all general partners, and 

the aforesaid George Sirota, a limited partner. George Sirota and Sons also 

renewed its registration for 1954 showing the same individuals as partners 

except that George Sirota is shown as a general partner. At the time of the 

entry of the decision and order on July 31, 1953, and at the time of the 

reopened hearing, the firm of Sirota and Company and the firm of George Sirota 

and Sons consisted of these four individuals as partners. 
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3. Sirota and Company and respondent George Sirota and Sons occupy the same 

quarters, and the salaries of all persons connected with both firms are paid by 

Sirota and Company. 

CONCLUSIONS

The respondents argue first that we have no jurisdiction to entertain and act 

upon the complainant's motion for clarification of the order. The gist of this 

argument seems to be that the proceeding was finished when the order of 

suspension was issued and that there is no authority under the applicable rules 

of practice (17 CFR § 0.0 et seq.) or otherwise to entertain the motion for 

clarification. The motion was filed prior to the effective date 

of the order suspending the registration of George Sirota and Sons and the 

suspension was postponed prior to its effective date pending action upon the 

motion. The motion alleged that the four partners in George Sirota and Sons 

were also the partners in Sirota and Company. Under these circumstances, we see 

no insurmountable legal barrier in reopening the proceeding to ascertain whether 

the sanction should apply against Sirota and Company as well as George Sirota 

and Sons. We think it is immaterial that the particular method for calling 

attention to the situation about the partnerships was a motion for 

clarification. In fact, we think that if the information had come to the 

attention of the Judicial Officer official notice of the files of the Commodity 

Exchange Authority would have been enough to warrant reopening of the record 

without the filing of any motion for clarification. At any rate the issuance of 

a final order did not deprive us of jurisdiction over the proceeding because the 

order had not become effective by its terms when the motion was filed and when 

the sanction ordered was postponed pending examination of the questions raised. 

The respondents also maintain that the partnership George Sirota and Sons is 

a legal entity, that the proceeding treated it as such, that Sirota and Company 

is another legal entity separate from George Sirota and Sons, and that it would 

be unlawful to suspend the registration of the partnership Sirota and Company at 

least without making the legal entity Sirota and Company a respondent in the 

proceeding and giving it notice, opportunity for hearing, etc. 

Whether or not the partnerships George Sirota and Sons and Sirota and Company 

may be separate legal or juristic entities for some purposes, n1 the facts are 

that the record shows that the two partnerships are comprised of the same four 

partners, have the same offices and have a common payroll. Sirota and Company 

was formed after the referee's report was issued recommending sanctions against 

George Sirota and Sons. We believe that a sanction against the partners in 

George Sirota and Sons, a futures commission merchant, for violations of the act 

cannot be defeated by the same partners setting up another partnership. True, 

the Commodity Exchange Authority believed that the registration of Sirota and 

Company had to be accepted since the only reason given in the act for refusing a 

registration is contained in section 3a of the act and reads as follows: 

"The Secretary of Agriculture is authorized -- * * * (2) to refuse to 

register any person if such person has violated any of the provisions of this 

act or any of the rules or regulations promulgated by the Secretary of 

Agriculture hereunder for which the registration of such person has been 

suspended (and the period of such suspension shall not have expired) or has been 

revoked; and * * *." 

n1 The complaint named as respondents, in addition to George Sirota and 

Sons, the three Sirotas as individuals and a copy of the complaint was 

served upon each respondent. 

Of course it would have been preferable to have had the facts as to the 

registration of Sirota and Company in the record prior to the issuance of the 

order suspending the registration of George Sirota and Sons. As we have stated 
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above, however, we do not believe that we are precluded from considering those 

facts now under the circumstances of this case. As far as the grievance that 

Sirota and Company has not had notice, hearing, etc., is concerned, the 

grievance is illusory because Sirota and Company is composed of the same 

individuals as George Sirota and Sons and notice, hearing and argument were 

given as to whether the sanction should apply to Sirota and Company. The 

presence of Laurence H. Taylor, brother-in-law of Benjamin Sirota, as a partner 

in George Sirota and Sons when he was not a partner at the time of the issuance 

of the complaint and as a partner in Sirota and Company does not strike us as 

making any material difference in our conclusions. Taylor joined George Sirota 

and Sons after the complaint was issued and there is no intent or attempt to 

reach Taylor personally and individually with a sanction. 

In summary, we conclude that the suspension of the registration of George 

Sirota and Sons should apply also to the registration of Sirota and Company. A 

review of the entire proceeding, however, including the fact that Benjamin 

Sirota and Norman L. Sirota's registrations as floor brokers were suspended, 

leads us to conclude that it is unnecessary in the public interest to make the 

ordered suspension effective at this time. Accordingly, the suspension ordered 

should be held in abeyance for a period of two years. 

ORDER

The order of July 31, 1953, suspending the registration of George Sirota and 

Sons as a futures commission merchant for a period of ten days is applicable to 

Sirota and Company and to respondents George Sirota, Norman L. Sirota, and 

Benjamin Sirota, collectively or individually, when operating as futures 

commission merchants under the name of George Sirota and Sons, 

Sirota and Company, or any other name; provided, however, that such order shall 

not become effective except by supplemental order in this proceeding entered if 

the Sirota respondents should be found after notice and hearing to have violated 

the act or regulations thereunder within two years from the date of this order. 

A copy of this order shall be served by registered mail upon respondents 

George Sirota and Sons, George Sirota, Norman L. Sirota, and Benjamin Sirota, 

and upon Sirota and Company, and upon each contract market under the act. 

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