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Commodity Futures Trading Commission 

CEA CASES 

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

AND ROBERT M. ZADRA 

DOCKET NUMBER: 100 

DATE: JULY 3, 1961 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Howard Randolph, Randolph Foods, Inc., James P. Hoban, Hoban and Company, 

and Robert M. Zadra, Respondents 

CEA Docket No. 100 

Complaint and Notice of Hearing under Section 6(b) of the Commodity Exchange 

Act 

There is reason to believe that the respondents, Howard Randolph, Randolph 

Foods, Inc., James P. Hoban, Hoban and Company, and Robert M. Zadra, have 

violated the Commodity Exchange Act (7 U.S.C. 1958 ed., Chapter 1), and the 

regulations made pursuant thereto, and in accordance with the provisions of 

section 6(b) of the said act (7 U.S.C. § 9), this complaint and notice of 

hearing is issued stating the charges in that respect as follows: 

I 

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. 

II 

Respondent James P. Hoban, an individual, is now and was at all times 

material herein engaged in the wholesale butter and egg business under the name 

and title of Hoban and Company, located at 1599 East Warren Avenue, Detroit, 

Michigan. 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. 

III 

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 under the name and title of New York Egg Auction, Inc. 
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IV 

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. 

V 

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 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 to respondent Robert M. Zadra and the said respondent, 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 37-1/2 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. 

VI 

(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 an order to raise the price of the said grade 

of eggs on the Exchange spot call on that day by 1/2 to 1-1/2 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 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 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 39-1/2 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 
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sell described in subparagraph VI(b), and the prices paid by the purchasers of 

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

subparagraph. 

VII 

By reason of the acts described above, respondents Howard Randolph, Randolph 

Foods, Inc., James P. Hoban, Hoban and Company, and Robert M. Zadra, attempted 

to manipulate and did in fact manipulate the price of eggs in interstate 

commerce, in willful violation of section 9 of the Commodity Exchange Act (7 

U.S.C. 1958 ed., § 13). 

WHEREFORE, it is hereby ordered that this complaint and notice of hearing be 

served upon the respondents. The respondents will have twenty (20) days after 

the receipt of this notice of hearing in which to file with the Hearing Clerk, 

United States Department of Agriculture, Washington 25, D. C., an answer with an 

original and seven copies, 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 not answered will be deemed admitted for the purpose of 

this proceeding. Failure to file an answer will constitute an admission of all 

the material allegations of this complaint and a waiver of hearing. The 

respondents are hereby notified that unless hearing is waived, either expressly 

or by failure to file an answer and request a hearing, a hearing will be held at 

10 a.m., local time, on the 22nd day of August, 1961, in New York, New York, at 

a place therein to be specified later, before a referee designated to conduct 

such hearing. At such hearing the respondents will have the right to appear and 

show cause, if any there be, why an order should not be made directing that all 

contract markets refuse all trading privileges to the respondents for such 

period of time as may be determined. 

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

respondents at least twenty (20) days prior to the date set for hearing. 

Done at Washington, D. C. 

July 3, 1961 

/s/ John P. Duncan, Jr. 

John P. Duncan, Jr. 

Assistant Secretary 

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