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Commodity Futures Trading Commission 

CEA CASES 

NAME: JAY H. SCHMIDT 

DOCKET NUMBER: 107 

DATE: JULY 30, 1962 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re Jay H. Schmidt, Respondent 

CEA Docket No. 107 

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

Act 

There is reason to believe that the respondent, Jay H. Schmidt, has violated 

the provisions of the Commodity Exchange Act (7 U.S.C. § 1 et seq.), and the 

rules and regulations made pursuant to its requirements (17 CFR, Part 1), 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, Jay H. Schmidt, is an individual whose address is 3950 Lake Shore 

Drive, Chicago, Illinois. 

II 

The Chicago Mercantile Exchange is now and was at all times material to this 

complaint a duly designated contract market under the Commodity Exchange Act. 

III 

On January 10, 11, and 12, 1962, the respondent held or controlled a net long 

position in shell egg futures on the Chicago Mercantile Exchange, which position 

ranged from 34 carlots to 64 carlots in a single future. By reason of the fact 

that such quantities were equal 

to or in excess of 25 carlots, the respondent was in reporting status and was 

required to report to the Commodity Exchange Authority with respect to all 

transactions executed and all open contract positions held or controlled by him, 

in all egg futures on all boards of trade (exchanges) on said dates and with 

respect to all transactions by reason of which the respondent's position was 

reduced below reporting levels, as provided in section 4i of the Commodity 

Exchange Act (7 U.S.C. § 6i) and sections 15.01, 15.02, 15.03, 18.00, 18.01 and 

18.03 of the regulations thereunder (17 CFR 15.01, 15.02, 15.03, 18.00, 18.01, 

18.03). 

IV 

On January 10, 11, and 12, 1962, while the respondent was in reporting status 

as described in paragraph III, and on January 15, 1962, when the respondent's 

position was reduced below 25 carlots, transactions in shell egg futures on the 

Chicago Mercantile Exchange were executed on his behalf, but the respondent 

failed or refused to submit a report to the Commodity Exchange Authority with 

respect to January 10, 1962, and submitted false reports with respect to January 
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11, 12, and 15, 1962, in willful violation of the aforesaid sections of the 

Commodity Exchange Act and the regulations thereunder. 

V 

During the period January 11 through January 15, 1962, the respondent held a 

speculative net long position in January 1962 shell egg futures on the Chicago 

Mercantile Exchange which ranged between 60 carlots and 64 carlots. 

VI 

On January 15, 1962, the respondent made speculative sales of 65 carlots of 

January 1962 shell egg futures on the Chicago Mercantile Exchange. 

VII 

By reason of the facts set forth in paragraphs V and VI above, the respondent 

willfully violated section 4a (2) of the Commodity Exchange Act and the order of 

the Commodity Exchange Commission establishing limits on positions and daily 

trading in shell eggs for future delivery (7 U.S.C. 6a (2); 17 CFR 150.5). 

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

served upon the said respondent. The respondent 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 five 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 

waiver of hearing. The respondent is 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 10:00 a.m., local time, on September 25, 1962, in 

Chicago, Illinois, at a place therein to be specified later, before a referee 

designated to conduct such hearing. At such hearing the respondent 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 

respondent for such period of time as may be determined. 

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

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

Done at Washington, D. C., 

July 30, 1962 

/s/ [ILLEGIBLE TEXT] 

[ILLEGIBLE TEXT] 

Assistant Secretary 

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