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Commodity Futures Trading Commission 

CEA CASES 

NAME: FRANCIS R. REARDON AND F. J. REARDON, INC. 

DOCKET NUMBER: 218 

DATE: DECEMBER 4, 1973 

DOCUMENT TYPE: COMPLAINT 

UNITED STATES DEPARTMENT OF AGRICULTURE 

BEFORE THE SECRETARY OF AGRICULTURE 

In re: Francis R. Reardon and F. J. Reardon, Inc., Respondents 

CEA Docket NO. 218 

Complaint and Notice of Hearing Under the Commodity Exchange Act 

There is reason to believe that the respondents have wilfully violated the 

provisions of the Commodity Exchange Act (7 U.S.C. Chapter 1) and in accordance 

with the provisions of sections 6(b) and 6(c) of the said Act (7 U.S.C. 9 and 

13b), this complaint and notice of hearing is issued stating the charges in that 

respect as follows: 

I 

Respondent Francis R. Reardon, an individual whose business address is c/o F. 

J. Reardon, Inc., 15 East Street, Cambridge, Massachusetts 02141, is now and was 

at all times material herein a registered floor broker under the Commodity 

Exchange Act and a member of the New York Mercantile Exchange. He is now and 

was at all times material herein President of respondent F. J. Reardon, Inc., 

whose business address is the same as that of the individual respondent. The 

corporate respondent is now and was at all times material herein a registered 

futures commission merchant under the Commodity Exchange Act and a clearinghouse 

member of the New York Mercantile Exchange. 

II 

The New York Mercantile Exchange is now and was at all times material herein 

a duly designated contract market under the Commodity Exchange Act. 

III 

The futures transactions referred to herein were for May 1973, Maine potato 

futures contracts traded on the New York Mercantile Exchange. Each of such 

contracts called for the delivery of 50,000 pounds of Maine-grown Irish potatoes 

and could have been used for (a) hedging transactions in interstate commerce in 

potatoes or the products or byproducts thereof, (b) determining the price basis 

of transactions in interstate commerce in potatoes, and (c) delivering potatoes 

sold, shipped, or received in interstate commerce for the fulfillment of such 

futures contracts. 

IV 

On September 13, 1972, the respondents allocated to the corporate firm's 

house account 20 contracts of May 1973 Maine Potato futures contracts bought at 

the lowest price of the day on the Exchange, notwithstanding that the 

respondents then held unfilled buy orders from their customers, which could have 

been executed at such price but were subsequently executed at a higher price. 

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By reason of the facts alleged in this complaint, the respondents wilfully 

violated section 4b of the Commodity Exchange Act (7 U.S.C. 6b). 

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

served upon the respondents and this proceeding shall be governed by sections 

0.1, 0.2, 0.4(b), 0.5 through 0.22, and 0.28 of the 

Rules of Practice under the Commodity Exchange Act (17 CFR 0.1, 0.2, 0.4(b), 0.5 

through 0.22, 0.28). The respondents will have twenty (20) days after the 

receipt of this complaint in which to file with the Hearing Clerk, United States 

Department of Agriculture, Washington, D.C. 20250, an answer with an original 

and three copies, fully and completely stating the nature of the defense and 

admitting or denying, specifically and in detail, each 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 

allegations of this complaint and a waiver of hearing. The filing of an answer 

in which all of the material allegations of fact contained in this complaint are 

admitted likewise shall constitute a waiver of hearing unless a hearing is 

requested. The respondents are hereby notified that unless a hearing is waived, 

a hearing will be held in Boston, Massachusetts, at a place therein and date to 

be specified later, before an Administrative Law Judge 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 appropriate order should not be issued 

in accordance with the Commodity Exchange Act, (1) prohibiting the respondents 

from trading on or subject to the rules of any contract market, and directing 

that all contract markets refuse all trading privileges to the respondents for 

such period of time as may be determined, (2) directing that the respondents 

shall cease and desist from violating the Commodity Exchange Act in the manner 

alleged 

herein, and (3) suspending or revoking the registration of the individual 

respondent as floor broker and the registration of the corporate respondent as 

futures commission merchant. 

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. 

December 4 1975 

[SEE SIGNATURE IN ORIGINAL] 

CLAYTON YEUTTER 

Assistant Secretary 

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