Public Affairs
WASHINGTON, July 14, 2022 – The U.S. Department of Agriculture (USDA) negotiated an administrative Consent Decision and Order with Stephen Smeal and Mendy Smeal, a Texas partnership doing business as Fatted Calf Cattle Farms #6 (Fatted Calf Cattle), on June 17, 2022, for alleged violations of the Packers and Stockyards (P&S) Act.
An investigation by USDA’s Agricultural Marketing Service revealed that from Sept. 7, 2019, through Jan. 8, 2020, Fatted Calf Cattle issued ten checks to two markets that the bank did not pay when first presented because Fatted Calf Cattle failed to maintain sufficient funds to cover the checks. Eight of the ten checks resulted in delayed payment to the markets later than the parties’ credit agreements allowed. Fatted Calf Cattle purchased 278 head of livestock in these eight transactions and paid $103,195, plus $260 in invoice adjustments, six to 37 days late.
The P&S Act requires subject entities to issue the full payment for livestock by the close of the first business day following purchase and transfer of possession. Parties may agree, in advance, to waive prompt payment by a written credit agreement. However, further delaying the standard payment period is considered an unfair trade practice and a violation of the P&S Act.
The consent decision included an Order requiring Fatted Calf Cattle, their agents, and employees to cease and desist from failing to pay for the full purchase price of livestock and failing to pay, when due, the full purchase price of livestock. In addition, Fatted Calf Cattle is suspended from operating in any capacity for which registration and bond are required under the Act for seven days, from July 17-24. Fatted Calf Cattle was also assessed a $13,000 civil penalty, payable in installments over 11 months. Should Fatted Calf Cattle violate the Act during the suspension period, any outstanding balance of the civil penalty will become immediately due and payable.
The P&S Act is a fair-trade practice and payment protection law that promotes fair and competitive marketing environments for the livestock, meat, and poultry industries.
For further information about the Packers and Stockyards Act, contact Kraig Roesch, Packers and Stockyards Division, at (202) 720-7051, or by email at kraig.roesch@usda.gov.
#
USDA touches the lives of all Americans each day in so many positive ways. In the Biden-Harris Administration, USDA is transforming America’s food system with a greater focus on more resilient local and regional food production, fairer markets for all producers, ensuring access to safe, healthy and nutritious food in all communities, building new markets and streams of income for farmers and producers using climate smart food and forestry practices, making historic investments in infrastructure and clean energy capabilities in rural America, and committing to equity across the Department by removing systemic barriers and building a workforce more representative of America. To learn more, visit www.usda.gov.
Get the latest Agricultural Marketing Service news at www.ams.usda.gov/news or follow us on Twitter
@USDA_AMS. You can also read about us on the USDA blog.
USDA is an equal opportunity provider, employer, and lender