Stockyards Act, 7 U.S.C. § 228c, by its terms clearly preempts any concurrent or conflicting state law regulating bonding, prompt payment and security interests governed by the Act. The choice of law rule this Court applies is as follows: the rights of plaintiff against individual defendants Mary Bonaccurso and Samuel Bonaccurso are determined initially by looking to the federal Act.
(2.4) Having decided the federal Act determines plaintiff's rights against the individual defendants, the Court considers the argument that neither 7 U.S.C. § 228 authorizing the Secretary of the Department of Agriculture to enforce the provisions of the Act, nor 7 U.S.C. § 196 which creates a statutory trust for the benefit of unpaid cash sellers could be interpreted as granting plaintiff a cause of action. Memorandum of Law in Support of Motion of Mary Bonaccurso and Samuel Bonaccurso for Summary Judgment at PP B(2), B(3), B(4); See, Pacific Trading Co., et al. v. Wilson and Co., et al., 547 F.2d 367, 368 (7th Cir. 1976). Whatever may have been the law prior to the Act's amendment in 1976, 7 U.S.C. § 209(a) expanded the claims which may be enforced by private parties to include suits by an unpaid cash seller against a packer. See, 1976 U.S.Code Cong. and Admin.News pp. 2267, 2273. Plaintiff's complaint at P 23, Docket Entry No. 1, bases his cause of action on Section 308 of the Act, 7 U.S.C. § 209.
From the decision that plaintiff has a cause of action under the Act, the Court continues analyzing each element necessary to recover under the Act to determine if a genuine issue of fact material to any one element exists to bar granting summary judgment under Fed.R.Civ.P. 56.
(2.5) Are the individual defendants "persons" and "packers" under the Act?
Defendants admit SBI is a "packer" under the Act. Answer to Complaint on Behalf of S. Bonaccurso & Sons, Inc., and Mary Bonaccurso at P 9, Docket Entry No. 5; deemed admitted under Fed.R.Civ.P. 8(d) by Samuel Bonaccurso's failure to deny, Answer to Complaint on Behalf of Samuel Bonaccurso at P 9, Docket Entry No. 8. Yet only if Mary Bonaccurso and Samuel Bonaccurso are "persons" under 7 U.S.C. § 182(1) can they be "packers" under 7 U.S.C. § 191, and only if they are "packers," can they be held liable for violating, Inter alia, the duty 7 U.S.C. § 228b(a) puts on packers to make next day payment, the duty 7 U.S.C. § 228b(c) puts on packers to not delay payment, and the duty of 7 U.S.C. § 196(b) puts on packers to hold livestock and proceeds therefrom in statutory trust for their unpaid cash sellers. A closely related question is whether the individual defendants are "persons" under 7 U.S.C. § 182(1) so as to be liable in plaintiff's action brought under 7 U.S.C. § 209.
Given the closely held nature of the SBI corporation, his active management role, the fact that plaintiff's June 22, 1977 notice that SBI was delaying payment was addressed to him in his role as buyer of SBI's livestock, See, P 2.2, Supra, the Court finds no genuine issue of material fact exists as to whether Samuel Bonaccurso was a "person engaged in the business . . . of buying livestock in commerce for the purpose of slaughter" and thereby hold him to be a "person" and a "packer" under the Act. 7 U.S.C. §§ 182(1), 191. This holding is buttressed by 7 U.S.C. § 223 which imputes liability to the corporate packer "(for) the act, omission, or failure of any agent, officer, or other person acting for or employed by any packer," as well as deeming the act, omission, or failure that of such agent, officer or other person.
Mary Bonaccurso argues that when Congress in 1976 repealed those subsections of 7 U.S.C. § 191 outlining how much stock ownership would bring a "person" within the definition of "packer," it intended to not impose the Act's duties on her since she was not "actively engaged" in SBI's business activities. Answer on Behalf of S. Bonaccurso & Sons, Inc., and Mary Bonaccurso at PP 36-40, Docket Entry No. 5; Memorandum of Law in Support of Motion of Mary Bonaccurso and Samuel Bonaccurso for Summary Judgment at P B(1), Docket Entry No. 22; Memorandum of Law in Opposition to Plaintiff Frank A. Fillippo's Cross-Motion for Summary Judgment Against Samuel Bonaccurso and Mary Bonaccurso at 10, Docket Entry No. 32. 7 U.S.C. § 191 formerly provided:
"When used in this chapter
The term "packer" means any person engaged in the business (a) of buying livestock in commerce for purposes of slaughter, or (b) of manufacturing or preparing meats or meat food products for sale or shipment in commerce, or (c) of manufacturing or preparing livestock products for sale or shipment in commerce, or (d) of marketing meats, meat food products, livestock products, dairy products, poultry, poultry products, or eggs, in commerce; but no person engaged in such business of manufacturing or preparing livestock products or in such marketing business shall be considered a packer unless