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Commodity Futures Trading Commission 

CEA CASES 

NAME: HOWARD RANDOLPH, RANDOLPH FOODS, INC., JAMES P. HOBAN, HOBAN AND COMPANY, 

ROBERT M. ZADRA, AND CARL A. BERGSTROM 

CITATION: 21 Agric. Dec. 219 

DOCKET NUMBER: 100 

DATE: MARCH 20, 1962 

DOCUMENT TYPE: DECISION AND ORDER 

(No. 7647) 

In re HOWARD RANDOLPH, RANDOLPH FOODS, INC., JAMES P. HOBAN, HOBAN AND COMPANY, 

ROBERT M. ZADRA, AND CARL A. BERGSTROM. CEA Docket No. 100. Decided March 20, 

1962. 

Manipulation of Price of Eggs -- Denial of Trading Privileges -- Consent 

Order

The respondents attempted to manipulate and did in fact manipulate the 

price of eggs in interstate commerce. All contract markets are ordered to 

refuse all trading privileges to respondents for specified periods. 

Mr. Donald A. Campbell, for Commodity Exchange Authority. Mr. Leon Quat, of New 

York, New York, for respondent Robert M. Zadra. Mr. Thomas J. Lynch, of 

Washington, D. C., for remaining respondents. 

Decision by Thomas J. Flavin, Judicial Officer

PRELIMINARY STATEMENT

This is an administrative proceeding, under the Commodity Exchange Act (7 

U.S.C. § 1 et seq.), instituted by a complaint and notice of hearing issued 

under § 6(b) of the Act (7 U.S.C. § 9) on July 3, 1961, by the Assistant 

Secretary of Agriculture. The complaint was amended on October 10, 1961. 

The complaint, as amended, charges that on January 13, 1961, the respondent 

Howard Randolph transmitted to the respondent Carl A. Bergstrom an order to 

raise the price of Fancy Heavyweight Mixed eggs on the spot call of the New York 

Mercantile Exchange on that day, and that the order was relayed to the 

respondent Robert M. Zadra, who caused a floor broker on the Exchange to bid for 

and purchase Fancy Heavyweight Mixed eggs on the spot call of the Exchange on 

January 13, 1961, at prices which resulted in an increase of 3/4 to one cent 

over the previous day's New York spot quotation for such eggs. The complaint 

further charges that on January 16, 1961, the respondents Howard Randolph and 

James P. Hoban transmitted to the respondent Carl A. Bergstrom orders to raise 

the price of Fancy Heavyweight Mixed eggs on the spot call of the Exchange on 

that day, and that the orders were relayed to the respondent Robert M. Zadra, 

who bid for and purchased Fancy Heavyweight eggs on the spot call of the 

Exchange on January 16, 1961, at prices which resulted in New York spot 

quotations for such eggs which were 11/2 to two cents over the previous day's 

New York spot quotations for such eggs. It is alleged that, by reason of such 

facts, the respondents attempted to manipulate and did in fact manipulate the 

price of eggs in interstate commerce, in wilful violation of § 9 of the 

Commodity Exchange Act (7 U.S.C. § 13). 
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No hearing has been held with respect to this proceeding. On March 19, 1962, 

the respondents filed a stipulation under § 0.4 (b) of the rules of practice (17 

CFR § 0.4(b)) in which they admit 

the facts hereinafter set forth, waive hearing on the charges, and consent to 

the entry of the order contained herein. 

FINDINGS OF FACT

1. The respondent Howard Randolph, an individual whose business address is 

Guthrie Center, Iowa, is now and was at all times material herein the president 

of respondent Randolph Foods, Inc., an Iowa corporation located at the same 

address, engaged in the egg merchandising and brokerage business. At all such 

times, respondent Howard Randolph managed and controlled the operations of the 

said corporation, and its business dealings and transactions were carried out 

under his direction and supervision. 

2. The respondent Hoban and Company, 1599 East Warren Avenue, Detroit, 

Michigan, is now and was at all times material herein a corporation engaged in 

the wholesale butter and egg business. At all such times, respondent James P. 

Hoban was the president of Hoban and Company and managed and controlled its 

operations, and the business dealings and transactions of the said firm were 

carried out under his direction and supervision. 

3. The respondent Robert M. Zadra, an individual whose business address is 

178 Duane Street, New York 13, New York, is now and was at all times material 

herein a member of the New York Mercantile Exchange, engaged in the egg 

merchandising and brokerage business individually, and he is the chief executive 

officer and stockholder of New York Egg Auction, Inc., a corporation organized 

under the laws of the State of New York, which corporation is engaged in the egg 

merchandising and brokerage business. 

4. The respondent Carl A. Bergstrom, an individual whose address is 1562 

Lemoine Avenue, Fort Lee, New Jersey, is now and was at all times material 

herein engaged in the egg merchandising and brokerage business. 

5. The New York Mercantile Exchange, hereinafter called the Exchange, is a 

duly designated contract market under the Commodity Exchange Act. Trading in 

cash eggs is conducted on the "spot call" of the Exchange on each business day, 

and the prices established in such trading enter into and are a part of the New 

York spot quotations for eggs. Such quotations are published in trade papers 

and disseminated throughout the 

United States, and are used for determining the price or price base of eggs sold 

and delivered in interstate commerce. 

6. Prior to January 13, 1961, respondent Randolph Foods, Inc., had sold 

approximately 4,400 cases of eggs at prices based upon the New York spot 

quotations for Fancy Heavyweight Mixed eggs on the day of delivery to the 

purchaser. Respondent Howard Randolph scheduled such eggs for delivery on 

Friday, January 13, 1961. On January 13, 1961, respondent Howard Randolph 

initiated and transmitted to respondent Carl A. Bergstrom an order to raise the 

price of the said grade of eggs on the Exchange spot call on that day by 1/2 to 

one cent per dozen. The said order was relayed by respondent Carl A. Bergstrom 

to respondent Robert M. Zadra and the said respondent Zadra, acting pursuant 

thereto, caused a floor broker on the Exchange to bid for and purchase Fancy 

Heavyweight Mixed eggs on the spot call of the Exchange on January 13, 1961, at 

prices which resulted in a New York spot quotation of 371/2 cents per dozen for 

such eggs on that day. Such quotation represented an increase of 3/4 to one 

cent over the previous day's New York spot quotation for such eggs. The 

subsequent resale of the eggs so purchased resulted in a loss which was paid by 

respondent Randolph Foods, Inc. 
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7. (a) Prior to January 16, 1961, respondent Randolph Foods, Inc., had sold 

approximately 4,300 cases of eggs at prices based upon the New York spot 

quotation for Fancy Heavyweight Mixed eggs on the day of delivery to the 

purchaser. Respondent Howard Randolph scheduled such eggs for delivery on 

Monday, January 16, 1961. On January 16, 1961, respondent Howard Randolph 

initiated and transmitted to respondent Carl A. Bergstrom an order to raise the 

price of the said grade of eggs on the Exchange spot call on that day by 1/2 to 

11/2 cents per dozen. 

(b) As of January 16, 1961, respondent Hoban and Company had sold or 

contracted to sell substantial quantities of eggs for later delivery at prices 

based upon the New York spot quotation for Fancy Heavyweight Mixed eggs on the 

first business day of the week of delivery. On Monday, January 16, 1961, 

respondent James P. Hoban initiated and transmitted to respondent Carl A. 

Bergstrom an order to raise the price of the said grade of eggs on the Exchange 

spot call on that day to 38 or 39 cents per dozen. 

(c) The orders of respondents Howard Randolph and James P. Hoban, described 

above, were relayed by respondent Carl A. Bergstrom to respondent Robert M. 

Zadra and the said respondent, 

acting pursuant to such orders, bid for and purchased Fancy Heavyweight eggs on 

the spot call of the Exchange on January 16, 1961, at prices which resulted in 

New York spot quotations of 39 to 391/2 cents per dozen for such eggs on that 

day. Such quotations represented increases of 1 1/2 to two cents over the 

previous day's New York spot quotation for such eggs. The subsequent resale of 

the eggs so purchased resulted in a loss which was paid by respondents Randolph 

Foods, Inc., and Hoban and Company. 

(d) During the week of January 16, 1961, respondent Hoban and Company shipped 

approximately 8,000 cases of eggs in fulfillment of the sales or contracts to 

sell described in subparagraph (b), above, and the prices paid by the purchasers 

of such eggs to respondent Hoban and Company were fixed as set forth in the said 

subparagraph. 

CONCLUSIONS

It is a violation of § 9 of the Act (7 U.S.C. § 13) for any person to 

"manipulate or attempt to manipulate the price of any commodity in interstate 

commerce" (7 U.S.C. § 13). The word "commodity" includes, inter alia, "eggs" (7 

U.S.C. § 2). The Secretary is authorized by § 6(b) of the Act to issue an order 

directing that all contract markets refuse all trading privileges thereon for 

such period as may be specified in the order to any person who has violated any 

of the provisions of the Act or who "has manipulated or is attempting to 

manipulate the market price of any commodity, in interstate commerce * * *" (7 

U.S.C. § 9). The facts described in Findings of Fact five through seven 

demonstrate that the respondents attempted to manipulate and did in fact 

manipulate the price of eggs in interstate commerce. 

The complainant states that the administrative officials of the Commodity 

Exchange Authority have carefully considered the proposed stipulation and order, 

and that they believe that the proposed sanction is adequate and that the prompt 

entry, without further proceedings, of the order to which the respondents have 

consented will constitute a satisfactory disposition of this case as against the 

said respondents, serve the public interest, and effectuate the purposes of the 

Act. The complainant, therefore, recommends that the stipulation and waiver 

submitted by the respondents be accepted and that the proposed order be issued. 

It is so concluded. 

ORDER

Effective on April 23, 1962, all contract markets shall refuse all trading 

privileges to Howard Randolph and Randolph Foods, Inc., for a period of 90 days; 

and to James P. Hoban and Hoban and Company, for a period of 60 days; and to 
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Robert M. Zadra and Carl A. Bergstrom, for a period of 30 days; such refusals to 

apply to all trading done and positions held by them directly or indirectly. 

A copy of this Decision and Order shall be served upon each of the parties 

and upon each contract market. 

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