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Commodity Futures Trading Commission 

CEA CASES 

NAME: L. RUDOLF COMPANY, INC. AND WILLIAM SCHAFFER 

DOCKET NUMBER: 57 

DATE: MARCH 7, 1953 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re L. Rudolf Company, Inc. and William Schaffer Respondents 

CE-A Docket No. 57 

Complaint and Notice of Hearing under the Commodity Exchange Act 

The Secretary of Agriculture has reason to believe that the respondents, L. 

Rudolf Company, Inc., and William Schaffer, have violated the Commodity Exchange 

Act (7 U.S.C., Chapter 1) and the rules and regulations one made pursuant to its 

requirements. In accordance with the provisions of section 6(b) of the 

Commodity Exchange Act (7 U.S.C. 9), this complaint and notice of hearing is 

issued alleging as follows: 

I 

L. Rudolf Company, Inc. is a corporation organized under the laws of the 

State of New York, with offices located at 141 Reade Street, New York, New York. 

The said corporation trades in eggs on the New York Mercantile Exchange through 

one of its officers, as hereinafter described. 

II 

William Schaffer, whose business address is 141 Feade Street, New York, New 

York, is treasurer of L. Rudolf Company, Inc. The said William Schaffer is a 

member of the New York Mercantile Exchange and he buys and sells eggs for the 

account and benefit of the said corporation. 

III 

The New York Mercantile Exchange is an interstate market, and eggs bought and 

sold on the said exchange move in interstate commerce. 

IV 

On or about July 8, 1952, respondent William Schaffer made a series of bids 

in rapid succession near the close of trading on the New York Mercantile 

Exchange, and thereby caused the recording of progressively advancing price 

quotations for a grade of eggs commonly known to the trade as "Checks." These 

bids were as follows 25 cases at 36 cents per dozen, 100 cases at 36 cents per 

dozen; 100 cases at 37 cents per dozen; 50 cases at 37 1/2 cents per dozen; and 

50 cases at 38 cents per dozen. The only other bid for the said grade of eggs 

on that day was made shortly before the bidding by respondent William Schaffer 

and was a bid for 25 cases at 34 cents per dozen. 

V 

The bids made by respondent William Schaffer, as described in paragraph IV 

above, were openly posted on the New York Mercantile Exchange and they served as 

the basis for market price quotations for "Check" eggs and thereby determined 

the price of such eggs in interstate commerce. 
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VI 

The bids made by respondent William Schaffer, as described in paragraph IV 

above, were made for the purpose and with the intact of raising the price of 

"Check" eggs, and they represented unwarranted increases in the price quotations 

for such eggs not justified by conditions of supply and demand. As a result of 

such bids, the price for "Check" eggs in interstate commerce rose to an 

artificial and manipulated level. 

VII 

The bids made by respondent William Schaffer, as described above, were within 

the scope of his duties as an officer of, and were made for the account and 

benefit of, respondent L. Rudolf Company, Inc. 

VIII 

By reason of the acts described above, the said respondents, L. Rudolf 

Company, Inc. and William Schaffer, attempted to manipulate and did in fact 

manipulate the price of a commodity in interstate commerce, in willful violation 

of section 6(b) of the Commodity Exchange Act (7 U.S.C. 9), and offered to enter 

into a transaction which was used to cause a price to be reported, registered, 

or recorded which was not a true and bona fide price, in willful violation of 

section 4e of the Commodity Exchange Act (7 U.S.C. 6c). 

Therefore, the said respondents, L. Rudolf Company, Inc. and William 

Schaffer, are hereby notified to be and appear at a hearing to be held at 10:00 

a.m., eastern standard time, on the 14th day of April 1953, in room 602, Cotton 

Exchange Building, 60 Beaver Street, New York, New York, before a referee 

designated to conduct such hearing and than and there show cause, if any there 

be, why an order should not be made directing that all contract markets refuse 

all trading privileges to the said respondents for such period of time as may be 

determined by the Secretary of Agriculture. 

The respondents will have 20 days after the receipt of this notice of hearing 

in which to file with the Secretary of Agriculture, in triplicate, an answer 

fully and completely stating the nature of the defense and admitting or denying 

specifically and in detail each material and relevant allegation of this 

complaint. Allegations that are not answered will be deemed admitted for the 

purpose of this proceeding. 

It is ordered that this complaint and notice of hearing be served on the 

respondents by delivery of a true copy thereof by an employee of the Department 

of Agriculture, or by registered mail, at least 20 days prior to the date set 

for hearing. 

Done at Washington, D. C. this 7 day of Mar., 1953. 

/s/ True D. Morse 

Acting Secretary of Agriculture 

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