N. J., I.F.R. 1451-1500
Issued June 1975
UNITED STATES ENVIRONMENTAL PROTECTION AGENCY
OFFICE OF ENFORCEMENT
OFFICE OF GENERAL ENFORCEMENT
PESTICIDES ENFORCEMENT DIVISION
NOTICES OF JUDGMENT UNDER THE FEDERAL
INSECTICIDE, FUNGICIDE, AND RODENTICIDE ACT
Nos. 1451-1500
Notices of Judgment report cases involving seizure actions
taken against products alleged to be in violation, and criminal and
civil actions taken against firms or individuals charged to be respon-
sible for violations. The following Notices of Judgment are approved
for publication as provided in Section 16(d) of the Federal Insecticide,
Fungicide, and Rodenticide Act, as amended (7 U.S.C. 136n).
Richard H. Johns
Acting Assistant Administrator
for Enforcement
Washington/ D.C.
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1451. In Re: The Parrott Chemical Company, EPA Region I, May
6,1974. (I.F.&R. No. 1-1OC, I.D. Nos. 102931 and 102932.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C 136j(a)(l)(E); 136(q)(l)(G); and 136(q)(1}(F). The action
pertained to products held for distribution or sale on or about August
29, 1973, at The Parrott Chemical Company, Stamford, Connecticut.
The pesticides involved were LUCKY STRIKE LAWN-GUARD
FORMULA NO. 404 and LUCKY STRIKE 50% LUCKY SEVEN
FORMULA NO. 7; the charge was misbranding—lack of adequate
warning or caution statement and lack of adequate direction for use
on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $50.00.
1452. In Re: Van Brode Milling Company, Inc., EPA Region I,
July 12, 1974. (LF.&R. No. I-12C, I.D. Nos. 93538, 95142
and 115093.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l); 136j(a)(l)(E); 136(q)(l)(G); 136{q)(l)(A);
136(q)(2)(A); 136(q)(2)(c}(iii); and 136(o). The action pertained to
shipments made on October 10, October 4, and December 18, 1973,
from Clinton, Massachusetts, to Mechanicsburg, Pennsylvania, Mem-
phis, Tennessee, and New Berlin, Wisconsin. The pesticide involved
was WATER PURIFICATION TABLETS FSN 6850-985-7166;
charges included nonregistration and misbranding—lack of
adequate warning or caution statement, lack of ingredient statement
and lack of net weight statement on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $10,000.00.
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1453. In Re: M & M Chemical Sales Corporation, EPA Region I,
July 22,1974. (I.F.&R. No. I-8C, I.D. Nos. 69108,89078 and
89080.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l) and 136j(a)(1)(E). The action pertained to shipments
made on March 9, April 4 and April 25, 1973, from Monson,
Massachusetts, to Hartford, Connecticut, and Plaistow, New
Hampshire. The pesticides involved were MEMCO BRAND ODOR
DISINFECTANT, PENTA-5 WOOD PRESERVATIVE, and
REDWOOD PENTA-STAIN PIGMENTED FINISH; charges included
nonregistration and misbranding—lack of adequate warning or
caution statement, lack of adequate ingredient statement and lack of
net content statement on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $ 1,000.00.
1454. U.S. v. Baird & McGuire, Inc., U.S. District Court,
Massachusetts, Criminal No. 74-11-T, July 24, 1974.
(I.F.&R. No. MOP, I.D. Nos. 78613, 95982, 95983, 88509,
102766, and 102909.)
This was a criminal action prepared by EPA Region I in which the de-
fendant was charged in a twenty count information with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
135a(a)(5); 135a(a)(l); 136i(a)(l}(E); 136(q)(l)(G); and 136(u). The
action pertained to shipments made on July 15, 1967; July 8 and
December 8, 1972; and June 15, 1973, from Holbrook,
Massachusetts, to Houlton, Maine; North Duluth, Georgia; and Bow,
New Hampshire, and to products held for distribution or sale on July
30, 1973, at Baird & McGuire, Inc., Holbrook, Massachusetts. The
pesticides involved were PARATHION 2 LB EMULSIFIABLE
CONCENTRATE, 50% MALATHION EMULSIFIABLE,
CONCENTRATE, 20% LINDANE EMULSIFIABLE
CONCENTRATE, PINE OIL DISINFECTANT, MALATHION 5 LB
EMULSIFIABLE CONCENTRATE, and CONCENTRATED RED
923
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DEVIL EMULSION BOWL CLEANER; charges included
nonregistration, adulteration and misbranding—lack of adequate
warning or caution statement on labels.
The defendant entered a plea of guilty to counts 1,3,4,5,8,10,11,16,
and 18, and nolo contendere to count 19. The remaining counts were
dismissed.
A fine of $20,000.00 was levied. $18,000.00 of the fine was
suspended and the firm was placed on probation for two years.
1455. In Re: Mallinckrodt Chemical Works, EPA Region llr
January 15,1974. (I.F.&R. No. II-15C, I.D. Nos. 102851 and
102852.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(1) and 135b. The action pertained to, shipments made
on August 16 and September 4, 1973, from Jersey. City, New Jersey,
to New Britain, Connecticut. The pesticide invloved was BANROT;
the charge was nonregistration.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $3600.00.
1456. In Re: Trio Chemical Works, Inc., EPA Region II, January
18,1974. (I.F.&R. No. II-12C, I.D. No. 88511.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 136j(a)(l)(E);. The action pertained to a shipment made on
December 11, 1973, from Brooklyn, New York, to Duluth, Georgia.
The pesticide involved was INSECTICIDE, AEROSOL, SYNERGIZED
PYRETHRIN XXX DISPENSER; charges included adulteration and
misbranding—strength or purity fell below the professed standard of
quality as expressed on its labeling.
924
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The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $2500.00.
1457. In Re: International Paint Co., Inc., EPA Region II, March
5,1974. (I.F.&R. No. II-14C, I.D. No. 104422.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C 135a(a)(l}; 135b and 136j(a)(l)(E). The action pertained to a
shipment made on July 30, 1973, from Union, New Jersey, to Phila-
delphia, Pennsylvania. The pesticide involved was INTERLUX 222
CANVAS PRESERVATIVE; charges included nonregistration and
misbranding—lack of ingredient statement on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $500.00.
1458. In Re: York Chemical Company,. Inc., EPA Region II,
March 12,1974. (I.F.&R. No. II-7C, I.D. No. 82026.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l); 135b; and 136j(a)(l)(E). The action pertained to a
shipment made on February 9, 1973, from Garden City, New Jersey,
to Boston, Massachusetts. The pesticide involved was CERTOX RAT
AND MOUSE MEAL; charges included nonregistration, adulteration
and misbranding—strength or purity fell below the professed
standard of quality as expressed in labeling.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $3500.00.
1459. In Re: Q-Pak Corporation, EPA Region II, March 22,1974.
(I.F.&R. No. II-8C, I.D. No. 89081.)
925
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This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C 136j(a)(l)(E); 136(q)(l)(A); and 136(c)(l). The action pertained
to a shipment made on May 1, 1973, from Newark, New Jersey, to
South Attleboro, Massachusetts. The pesticide involved was
FLAGSTAFF BLEACH; charges included adulteration and
misbranding—strength or purity fell below the professed standard of
quality as expressed in labeling.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $600.00.
1460. In Re: The Terre Company, EPA Region II, April 2, 1974.
(I.F.&R. No. II-13C, I.D. No. 91884.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C 136j(a){l)(E); 136(c){2); and 136(q)( 1 )(A). The action pertained
to a product held for distribution or sale on August 28, 1973, at The
Terre Company, Saddle Brook, New Jersey. The pesticide involved
was TERRE CHINCH BUG KILLER WITH SEVIN; charges included
adulteration and misbranding—the product contained an additional
active ingredient not declared on labeling.
The repondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $ 1000.00.
1461. In Re: 8 in 1 Pet Products, Inc., EPA Region II, April 11,
1974. (I.F.&R. No. II-17C, I.D. No. 101972.)
This was a civil action in which the respondent was charged with
violating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l). The action pertained to a shipment made on March
8, 1973, from Brentwood, New York, to Denver, Colorado. The
pesticide involved was WONDER FLUFF BEAUTY BATH; the
charge was the composition of the product differed from that re-
presented in connection with its registration.
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The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $500.00.
1462. In Re: Agway, Inc., Chemical Division, EPA Region II,
April 13,1974. (I.F.&R. No. II-20C, I.D. No. 89318.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C 136j(a)(l)(E) and 136(c)(2). The action pertained to a shipment
made on December 29, 1972, from Big Flats, New York, to Yardville,
New Jersey. The pesticide involved was MALATHION 5E; charges
included misbranding and adulteration—product contained an
additional active ingredient not declared in labeling.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $1700.00.
1463.. In Re: Ecological and Specialty Products, Inc., EPA
Region II, April 15, 1974. (I.F.&R. No. II-19C, I.D. No.
87734.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l) and 135b. The action pertained to a shipment
made on March 8, 1973, from Paterson, New Jersey, to Farmingdale,
New York. The pesticide involved was MICROMICIN S; the charge
was nonregistration.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $500.00.
1464. In Re: H. Clay Glover Co. Inc., EPA Region II, April 26,
1974. (I.F.&R. No. II-22C, I.D. No. 91861.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
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U.S.C. 136j(a)(l){E); 136(c)(2); and 136(q)(l)(A). The action pertained
to a product held for distribution or sale on August 28, 1973, at H.
Clay Glover Co., Inc., Toms River, New Jersey. The pesticide involved
was GLOVERS IMPERIAL FLEA KILLER; charges included
adulteration and misbranding—product contained an additional
active ingredient not declared in labeling.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $2,000.00.
1465. In Re: Hortus Products Co., EPA Region II, May 2, 1974.
(I.F.&R. No. II-16C, I.D. No. 104406.)
This was a civil action in which the respondent was charged with
violating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l) and 135b. The action pertained to a shipment
made on January 26, 1973, from New Foundland, New Jersey, to
New Brighton, Pennsylvania. The pesticide invloved was HORMO-
ROOT EXTRA SUPER STRENGTH; the charge was nonregistration.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $50.00.
1466. U.S. Polychemical Corp., EPA Region II, May 3,1974.
(I.F.&R. No. II-28C, I.D. No. 87668.)
This was. a civil action in which the respondent was charged with
violating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 136j(a)(l)(E). The action pertained to a product held for distri-
bution or sale on October 31, 1973, at U.S. Polychemical Corp.,
Spring Valley, New York. The pesticides involved was
POLYCHEMICAL SHOE SPRAY WITH HEXOCHLOROPHENE;
the charge was misbranding—the product contained 26 times the
amount of active ingredient declared in labeling.
A civil penalty of $ 1,800.00 was assessed by Default Order.
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1467. In Re: Independence Chemical Co., EPA Region II, May
14,1974. (I.F.&R. No. II-32C, I.D. No. 105341.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 136j(a)(l)(E) and 136(q)(l)(A). The action pertained to a
product held for distribution or sale on January 22, 1974, at In-
dependence Chemical Co., Gloucester City, New Jersey. The
pesticide involved was INDEPENDENCE BOWL CLEANER; the
charge was misbranding—product contained less active ingredient
than declared in labeling.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $600.00.
1468. In Re: Will & Baumer Candle Co., Inc., EPA Region II, June
28,1974. (I.F.&R. No. II-33C, I.D. No. 91666.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(1) and 135b. The action pertained to a shipment
made on March 27, 1973, from Syracuse, New York, to Dunellen,
New Jersey. The pesticide involved was CITRONELLA...TEAR
DROP LITE; the charge was nonregistration.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $700.00.
1469. In Re: Straight Arrow, Inc., EPA Region II, July 9, 1974.
(I.F.&R. No. II-6C, I.D. No. 95559.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 136Ha)(l)(E); 136(q)(l)(A); and 136(c)(l). The action pertained
to a shipment made on March 6, 1973, from Fairfield, New Jersey, to
Shelbyville, Tennessee. The pesticide involved was JUNGLE-JET FLY
AND MOSQUITO REPELLENT; the charges included adulteration
929
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and misbranding—its strength or purity felt below the professed
standard of quality as expressed on its labeling.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $600.00.
1470. In Re: Para Laboratories, EPA Region II, July 18r 1974.
(I.F.&R. No. II-3C, I.D. No. 93779.)
This was a civil action in which the respondent was charged with vio-
lating 'the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l), 135b; and 136j(a)(1)(E). The action pertained to a
shipment made on February 21,1973, from Hempstead, New York,
to Evergreen Park, Illinois. The pesticide involved was
FORMALDEHYDE; charges included nonregistration and
misbranding—labels bore a false or misleading registration number
implying that the product was registered.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $ 1250.00.
1471. In Re: Wilbert Products Co., Inc., EPA Region II, July 25,
1974. (I.F.&R. No. II-39C, I.D. No. 105359.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 136j(a)(l)(E); 136(c)(l); and 136(q)(l)(A). The action pertained
to a product held for distribution or sale on November 27, 1973, at
Wilbert Products Co., Inc., Bronx, New York. The pesticide involved
was WILBERT FRESH PINE SCENT; charges included adulteration
and misbranding—its strength or purity fell below the professed
standard of quality as represented in labeling.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $1300.00.
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1472. In Re: Johnson Nurseries, EPA Region II, August 9,1974.
(I.F.&R. No. II-30C, I.D. No. 102165.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C 135a(a)(l); 135b; 136j(a)(l)(E); and 136(q)(2)(A). The action
pertained to a shipment made on January 9, 1973, from Dexter, New
York, to Kansas City, Missouri. The pesticide involved was SCENT-
OFF PELLETS; charges included nonregistration and
misbranding—lack of adequate ingredient statement on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $600.00.
1473. In Re: Middiebrooke Lancaster, Inc., EPA Region II,
September 18,1974. (I.F.&R. No. 1I-42C, I.D. No. 93539.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l) and 135b. The action pertained to a shipment
made on January 26, 1973, from Brooklyn, New York, to Harrisburg,
Pennsylvania. The pesticide involved was NUTRINE
FORMALDEHYDE SOLUTION; the charge was nonregistration.
A civil penalty of $3,000.00 was assessed by Default Order.
1474. In Re: Luminal Paints, EPA Region II, September 21,1974.
(I.F.&R. No. II-49C, I.D. No. 93593.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 135a(a)(l); 135b; 136j{a)(l)(E); and 136(q)(2)(A). The action
pertained to a shipment made on June 18, 1973, from Newark, New
Jersey, to Philadelphia, Pennsylvania. The pesticide involved was
LUMINALL LATEX SWIMMING POOL PAINT; charges included
nonregistration and misbranding—lack of adequate ingredient
statement on labels.
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The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $450.00.
1475. In Re: Johnson Chemical Company, Inc., EPA Region II,
October 8,1974. (I.F.&R. No. II-l 1C, I.D. No. 91718.)
This civil penalty proceeding was settled by hearing. The following is
Administrative Law Judge Bernard D. Levinson's Initial Decision.
Preliminary Statement
By complaint dated November 1, 1973, the Director,
Environmental Programs Division, Environmental Protection Agency,
Region II, charged the above respondent with violations of the
Federal Insecticide, Fungicide, and Rodenticide Act, as amended, 7
U.S.C. 136 et seq. (FIFRA) and sought the assessment of a civil
penalty of $TT200~under section 14(a) of the Act, 7 U.S.C. 136_[(a).
The respondent filed an answer and requested a hearing which was
held in New York City on August 8, 1974. At the hearing the
complainant was represented by Ms. Carol L Dudnick of the legal
staff of EPA, Region II and the respondent was represented by Mr.
Frank Uddo, president of respondent who is not an attorney.
The complaint alleges that respondent violated section
12(a)(l)(E)of the Act, 7 U.S.C. 136j(a)(l)(E)in that on August.!, 1973,
it held for sale in Brooklyn, New York, the pesticide called "King
Spray Ant and Roach Killer" that was adulterated and misbranded.
Adulteration is alleged under section 2(c)(l) of the Act, 7 U.S.C.
136(c)(l) in that the strength and purity of the pesticide fell below the
professed standard of quality as expressed on the labeling under
which it was sold. Misbranding is alleged under section 2(q)(l)(A), 7
U.S.C. 136(q}(l)(A) in that the label represented the product to
contain 2.2 dichlorovinyl dimethyl phosphate (hereinafter DDVP)
.465% and related compounds .035% ' when in fact the product
contained an average of .308 % of this ingredient.
The respondent did not contest the allegations of the complaint
relating to the violations. The respondent claimed that there were
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mitigating circumstances in the case and that because of its un-
blemished record of 35 years its record should continue to be blemish
free. In substance the respondent asked for dismissal of the case or a
finding of no violations.
We are concerned here only with DDVP content of the spray in
question.
The complainant filed a brief and proposed findings and
conclusion. The respondent submitted a letter in support of its
position.
After consideration of the record we make the following
Findings of Fact
1. The respondent is engaged primarily in the sale and dis-
tribution of pesticides and has a place of business in Brooklyn, New
York. The company has been in business since 1939 and its gross
annual sales are approximately $5,000,000. It has 30 employees.
One of the principal pesticides distributed by respondent is called
King Spray Ant and Roach Killer.
/
2. In September 1971, on application of respondent, EPA
registered the product King Spray Ant and Roach Killer under
registration number 5130-6. The approved label listed several
ingredients including DDVP .474% and related compounds .036%.2
The product was represented as a pesticide not only for ants and
roaches but for killing a number of other insects.
3. In December 1972 a revised label for the product in question
under registration number 5130-6 was approved by EPA. Except for
certain changes in the list of ingredients, the label approved was
identical to the label earlier approved in September 1971. The
change of ingredients here material reduced the DDVP and related
compounds by 50%-from .474% and .036%, respectively to .237%
and .018%, respectively.
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4. The basic mixture of ingredients for the product in question is
prepared for respondent by Mclaughlin Gormley King Co. (MGK), a
large chemical specialty manufacturer and formulator.
5. Under arrangements with respondent, Connecticut Aerosols,
Inc. (CA), Milford, Connecticut, packages the product. MGK ships the
basic mixture for this spray to CA, where it is diluted to a 10%
solution with a petroleum distillate and gas-filled in aerosol cans and
shipped to the respondent in Brooklyn, New York. The cans are
supplied to CA by a large can manufacturing company. The label of
the cans as furnished by the can supplier bears a statement of
ingredients, with percentages of ingredients.
6. The respondent's volume for this product is about 2-1/2
million cans a year. Cans for the packaging are ordered by CA
several months in advance. When the change of formula was
approved in December 1972, CA ordered from the can supplier cans
with the new statement of ingredients. The cans with the new
statement of ingredients began to arrive May 1973 and CA began
packaging under the new label on May 16, 1973. At that time CA
had on hand a quantity of the basic mixture of the old formula and a
substantial number of cans with the old label and it continued to
package some of the product under the old formula until July 17,
1973. Thus, from May 16, 1973 to July 17, 1973, CA was packaging
the product under both formulas.
7. The records of CA show that on July 23, 1973, it packaged
11,664 cans under the new formula. Some of the cans with old labels
were filled with the product that was supposed to be in accordance
with the new formula. Exactly how many cans were so filled does not
appear, but an official of CA, based on the company records, gave
an estimate of 1,000 to 2,000 cans. Shortly after packaging the cans
on July 23, 1973, CA shipped a number of the cans, in case lots of 12
each, to respondent in Brooklyn, New York.
8. On August 1, 1973, the respondent was holding for sale at its
premises in Brooklyn, New York 38 cases of the product in question,
each case containing 12 cans of 13-3/4 ounces, of the product. On
that date an inspector of EPA collected from the premises of
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respondent as a sample three cans of the product that were held for
sale. The labels of these cans listed DDVP at .465% and related
compounds at .035%. (It is noted that this is a variation from the
label approved in September 1971.) Chemical analysis by EPA
chemists showed the product to contain .308% DDVP and related
products rather than the .500% declared on the label (.465% and
.035 % related compounds).
9. The pesticide in question was adulterated within the meaning
of section 2(c)(l) of FIFRA as amended (7 U.S.C. 136(c)(l)) in that its
strength fell below the professed standard of quality expressed on
the label under which it was sold. The said pesticide was also
misbranded within the meaning of section 2(q)(l)(A) of FIFRA as
amended (7 U.S.C. 136(q)(l)(A) in that its label was false and
misleading.
Conclusions
The respondent has not contested the allegations of the
complaint relating to the violations. Thus, it is established that the
respondent held for safe a pesticide that was adulterated and
misbranded. The adulteration and misbranding arise out of the
misstatement on the label as to ingredients. Although the product was
in violation of the statute under two separate provisions, i.e.
adulteration and misbranding, proof of the same facts will establish
both violations and only one penalty may be imposed. Blockburger v.
U.S., 284 U.S. 299, 304 (1932).
The complaint proposed to assess a civil penalty of $ 1,200. This
was based on the civil penalty assessment schedule for violations of
section 14(a) of FIFRA, 7 U.S.C. 136_L 3 Under the schedule for a
business with gross sales of over $1,000,000, 4 the penalty for
defective ingredient statement where the formulation differs from
that on the labeling is $1,200.
In determining the amount of penalty to be assessed. Section
14(a)(3) of the statute, 7 U.S.C. 136_l_(a)(3) requires that there shall
be considered the appropriateness of the penalty to the size of re-
spondent's business, the effect on respondent's ability to continue in
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business, and the gravity of the violation. Section 168.60(b) of the
rules of practice provides that in evaluating the gravity of the vio-
lation there shall also be considered respondent's history of
compliance with the Act and any evidence of good faith or lack
thereof.
The respondent is a relatively large company and assessment of
a penalty of $1,200 will have no adverse effect on its ability to
continue in business.
In the factors to be considered in assessing civil penalties, the
guidelines as published in the Federal Register on July 31, 1974, 39
F.R. 27712, as to "gravity of violation" states:
The gravity of any violation is a function of (1) the
potential that the act committed has to injure man or the
environment; (2) the severity of such potential injury; (3)
the scale and type of use anticipated; (4) the identity of
the persons exposed to a risk of injury; (5) the extent to
which the applicable provisions of the Act were in fact
violated; (6) the particular person's history of compliance
and actual knowledge of the Act; and (7) evidence of
good faith in the instant circumstance.
We recently expressed our view in another case under the civil
penalty provision that in considering appropriateness of the penalty
to the "gravity of the violation" the evaluation should be made from
two aspects—gravity of harm and gravity of misconduct.s
From the gravity of harm aspect we can find no basis for making
a finding adverse to respondent. The respondent's product under the
name King Spray Ant and Roach Killer was approved in 1971 with a
label that showed .510% DDVP and related compounds. A revised
label for a product under this name, with the identical representations
for use and efficacy, was approved in 1972 with content of DDVP
and related compounds at .255%. The samples that were collected
contained an average of .308% DDVP and related compounds. We
find that the product in question with a content of .308% of DDVP
and related compounds would have been efficacious for the uses
936
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represented on the label and its use in accordance with directions on
the label would not have resulted in any injury or adverse effects on
man or the environment. Thus, we consider the gravity of harm as
zero.
There was misconduct on the part of respondent in that it failed
to exercise some form of quality control over the product it distributed
that resulted in the violative product being held for sale. We do not
find that respondent acted deliberately or with intent to violate the
law. But intent is not an element of an offense under the civil penalty
provisions of FIFRA as amended. 6 (Cf. U.S. v. Dotterweich, 320 U.S.
277 (1943)).
The label of the product showed that the respondent was the
distributor. The product was manufactured for it and it held the
product for sale. The fact that the product was manufactured by a
company engaged by respondent, with ingredients furnished by
another company, does not relieve respondent from its obligation
under the statute to refrain from selling or holding for sale violative
products. 7 See United States v. Parfait Powder Puff Co., 163 F.2d
1008 (7th Gr. 1947), cert, den., 332 U.S. 851; United States v.
Dotterweich, supra.
Analysis of the product showed that it contained .308% DDVP
and related products rather than the .500% declared on the label.
This was a 38% deficiency. Further, the product did not comply with
the ingredient statement on the new label which was approved by
EPA in December 1972. This called for .255% DDVP and related
compounds. In this regard the product was over formulated by 21 %.
The respondent has violated the Act and is subject to the
assessment of a civil penalty. As above noted there was no potential
harm in the distribution of this product. Further, the respondent's
violation was not deliberate or intentional. We also consider as
significant the fact that respondent has been in business for 35 years
and there is no evidence of non-compliance with FIFRA, either before
or after the 1972 amendments. No citations or warning letters were
ever issued to it. (See section 9(c) of FIFRA as amended, 7 U.S.C.
136g(c) and section 6(c) of FIFRA prior to 1972 amendment, 7 U.S.C.
937
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135d(c)). Thus, there is no evidence of any history of this respondent's
non-compliance with the Act. Also, there is no evidence that the
respondent did not act in good faith.
Section 168.46(b) of the Rules of Practice provides that "the
Administrative Law Judge may at his discretion increase or decrease
the assessed penalty from the amount proposed to be assessed in the
complaint."
Even though respondent is a relatively large company and well
able to pay the proposed penalty of $1,200, * considering the nature
and gravity of the violation we are of the view that a penalty of $400
is appropriate.
Having considered the entire record and based on the Findings
of Fact and Conclusions herein, it is proposed that the following order
be issued.
Final Order
Pursuant to section 14(a)(l) of the Federal Insecticide,
Fungicide, and Rodenticide Act, as amended (7 U.S.C. 136Jja}(1)), a
civil penalty of $400 is assessed against respondent Johnson
Chemical Company Inc., Brooklyn, New York for violations of said
Act which have been established on the basis of complaint issued on
November 1,1973.
Bernard D. Levinson
Administrative Law Judge
Octobers, 1974
'The trademark for this product manfactured by Shell Chemical
Company is Vapona.
938
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2A product under this name was registered by respondent under No.
5130-2 in February 1967 and was cancelled in April 1971. This
product as registered contained DDVP .460% and related
compounds .040%. This product also contained dieldrin which was
not an ingredient of the product registered under number 5130-6.
3The civil penalty assessment schedule was published in the Federal
Register at the same time the final rules of practice were published on
July 31, 1974, 39 F.R. 27711. The schedule as published differed in
some respects from the schedule previously used by EPA enforcement
officials, but the penalty for violations of this type was unchanged in
the schedule as published.
4ln prehearing correspondence respondent gave its gross sales as
$5,000,000.
This was before the assessment guidelines were published. Our views
and the guidelines are not inconsistent.
*The criminal penalty section of the Act, 14(b), requires that the
violation be "knowingly".
7We have not considered the application of section 12(b) of the Act
since there is no evidence of a guaranty under this section.
'While the under-formulation or over-formulation of this product did
not pose potential injury to man or the environment and efficacy was
not affected, deviations of such magnitude in pesticides containing
certain other ingredients may have serious adverse effects in these
areas.
'See respondent's letter of May 5,1974, p. 2.
1476. In Re: Chem Servs-Div. Imoco Gtwy, EPA Region III, July
5,1974. (I.F.&R. No. III-40C, I.D. No. 104517.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
939
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U.S.C 135a(a)(l); 135b; 136j(a)(l)(E); 136{q)[l){G); and 136(q)( 1 )(F).
The action pertained to a shipment made on September 19, 1973,
from Baltimore, Maryland, to Wilmington, Delaware. The pesticide
involved was STERLING QUALITY RUG & UPHOLSTERY
SHAMPOO;charges included nonregistration and
misbranding—lack of adequate warning or caution statement and
lack of adequate ingredient statement on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $1800.00.
1477. In Re: B & G Equipment Co., EPA Region III, July 19,1974.
(I.F.&R. No. III-42C, I.D. No. 104480.)
This was a civil action in which the respondent was charged with vio-
lating the Federal Insecticide, Fungicide, and Rodenticide Act, 7
U.S.C. 136j(a}(l)(E); 136(q)(l)(F); 136(q)(2)(C)lv); and 136(q)(2)(C){iii).
The action pertained to a product held for distribution or sale on Sep-
tember 13, 1973, at B & G Equipment Co., Plumsteadville,
Pennsylvania. The pesticide involved was BAN-BUG SPECIAL
RESIDUAL INSECT SPRAY KILLS RESISTANT ROACHES; the
charge was misbranding—lack of adequate directions for use, lack of
statement of net weight or measure of content, and lack of the
assigned registration number on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $800.00.
1478. In Re: Pearson & Company, EPA Region iV, May 31,
1974. (I.F.&R. No. IV-33C, I.D. Nos. 88176, 88468 and
90943.)
This civil penalty proceeding was settled by hearing. The following is
Administrative Law Judge Bernard D. Levinson's Initial Decision.
Preliminary Statement
940
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This is a consolidated proceeding under section 14(a) of the
Federal Insecticide, Fungicide, and Rodenticide Act, as amended in
1972 (FIFRA 1972), 7 U.S.C. 136 et seq., for the assessment of civil
penalties for violations of the Act. Three complaints were issued
against the respondent on November 2, 1973, by the Director, En-
forcement Division, Region IV, Environmental Protection Agency,
charging violations of section 12 of the Act. With regard to each
complaint the respondent filed an answer and requested a hearing.
Pursuant to section 168.22(a) of the Interim Rules of Practice
governing proceedings of this type (38 F.R. 26360, September 20,
1973), the Administrative Law Judge, on his own motion, ordered
that the three proceedings be consolidated.
In substance, the allegations in the complaints are as follows:
I.D. No. 88176 On or about February 13, 1973, the respondent
shipped the pesticide Guff States 5% Rotenone (hereinafter
Rotenone) from Mobile, Alabama, to Paducah, Kentucky; said
pesticide was misbranded because it had less than 5% rotenone (7
U.S.C. 136(q)(l)(A); it was adulterated in that its strength or purity fell
below the professed standard or quality under which it was sold (7
U.S.C. 136(c)(l)). Proposed penalty assessment, $1,500.
I.D. No. 88468 On or about February 6, 1973, the respondent
shipped the pesticide Azalea Petal Blight Dust (hereinafter Azalea
Dust) from Mobile, Alabama, to Pensacola, Florida; said pesticide
was not registered (7 U.S.C. 135(b)); it was misbranded because the
label contained a registration number (7 U.S.C. 136(q)(1)(A)); it was
misbranded because the label stated that it contained 3.25% of zinc
ethylene bisdithiocarbamate whereas it had less than 3.25% of this
ingredient and it contained an additional active ingredient
(chlordane) which was not listed (7 U.S.C. 136(q)(l)(A)); it was
adulterated in that its strength or purity fell below the professed
standard or quality under which it was sold (7 U.S.C. 136(c)(l)); it was
adulterated in that another substance (chlordane) had been
substituted wholly or in part for the article (7 U.S.C. 136(c)(2)).
Proposed penalty assessment, $4,750.
941
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I.D. No. 90943 On or about January 30, 1973, respondent
shipped the pesticide Poison Paste from Mobile, Alabama, to
Shreveport, Louisiana; said pesticide was misbranded because the
label did not bear a warning or caution statement which is necessary
and, if complied with, adequate to protect health and the en-
vironment (7 U.S.C 136{q)(1)(G); it was misbranded in that the label
of the product failed to bear the registration number assigned (7
U.S.C. 136(q)(l)(C)(V)).2 Proposed penalty assessment, $2,250.
With respect to I.D. Nos. 88176 (Rotenone) and 88468 (Azalea
Dust), the answers do not deny or contest the charges but rather
attempt to explain how the violations occurred. The answers request
cancellation or reduction of the proposed penalties. With respect to
I.D. No. 90943 (Poison Paste), the answer denies both misbranding
charges and urges that no penalty is assessable.
Upon the filing of answers and requests for hearing, the cases
were forwarded to the Administrative Law Judge for further
proceedings. After consolidating the three cases the AU
corresponded with the parties for the purpose of accomplishing some
of the objectives of a prehearing conference (see Rules of Practice,
section 168.36{d)}. This correspondence is included in the record.
A hearing was held in Mobile, Alabama, on February 19 and 20,
1974. The complainant was represented by James H. Sargent, Esq.,
Chief, Legal Support Branch, Region IV, EPA, and the respondent was
represented by Kirk C. Shaw, Esq., of the law firm of Armbrecht,
Jackson, and De Mouy, of Mobile.
Proposed findings of fact and briefs were filed by the parties
and have been duly considered by the Administrative Law Judge.
After consideration of the entire record, the Administrative Law
Judge makes the following
Findings of Fact
1. The respondent, Pearson & Company, located in Mobile,
Alabama, is a partnership consisting of C. Ferrell Pearson and his
942
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wife, Gertrude R. Pearson. Mr. Pearson, age 68, manages the
company.. The company has been in business since 1930, and
manufactures and distributes insecticides and legume inoculants. At
present, the company has 54 pesticides registered with the
Environmental Protection Agency.
2. On February 13,1973, the respondent shipped a total of 600
pounds (20 cases each containing 4 bags of 7.5 pounds each) of the
pesticide Gulf States 5% Rotenone from Mobile, Alabama, to
Paducah, Kentucky.
3. The label on the bags of the pesticide referred to in Finding 2
stated that the pesticide contained as an active ingredient 5 %
rotenone. The pesticide was 18.06% deficient in rotenone and was
less effective than it would have been if it contained 5% rotenone.
On previous occasions, the respondent had been cited by
enforcement officials regarding deficiences of rotenone in its
products.
4. On February 6, 1973, the respondent shipped a total of 312
pounds (13 cases each containing 24 bags of 1 pound each) of the
pesticide Azalea Petal Blight Dust from Mobile, Alabama, to
Pensacola, Florida.
5. The label on the bags of the pesticide referred to in Finding 4
stated that the pesticide was registered under No. 728-25. The said
pesticide had been registered in 1967 under this number but the
registration of said pesticide had been cancelled effective May 5,
1971.
6. The label of the pesticide referred to in Finding 4 stated that
it contained as an active ingredient 3.25% zinc ethylene bis-
dithipcarbamate. The said pesticide contained less than 3.25% of
this ingredient, two samples showing an average deficiency of
22.6%. The label of said pesticide did not list chlordane as an active
ingredient and it did contain chlordane as an active ingredient, two
samples showing an average of 0.49 %.
943
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7. On January 30, 1973, the respondent shipped 36 tubes each
containing two ounces of the pesticide Pearson's Poison Paste from
Mobile, Alabama, to Shreveport, Louisiana. Each tube was in a
cardboard box which measured 5-1/8" x 1-1/2" x 1". The label
represented that the product contained as the active ingredient 2 %
phosphorus. Enclosed in each cardboard box was labeling consisting
of a one page printed sheet. The labeling represented the product to
be an insecticide and rodenticide.
8. The front panel of the tubes (i.e. the immediate containers) of
Pearson's Poison Paste did not bear an antidote statement or a
statement to see the antidote statement on the back panel. The said
tubes did not bear the following statements: "May be fatal if
swallowed", "For professional pest control operator and government
agency use only", "Not for use in or around the home."
9. Prior to the above shipment of Pearson's Poison Paste on
January 30, 1973, respondent was advised by officials of EPA that
the certain warning statements were required to appear on the label:
(a) Letter of November 1, 1972, advised respondent that the
statement "See antidote statement and other precautions on back
panel" should appear on the front panel of the tube.
(b) The said letter of November 1, 1972, advised respondent
that the tube must bear the statement "May be fatal if swallowed."
Similar advise was given to respondent in letters of August 29, 1972,
and December 14,1972.
10. The product Pearson's Poison Paste contains phosphorus
which is highly toxic to humans. Other pesticides containing this
chemical have been involved in poisonings of children.
11. In using this product it is likely that the pasteboard container
and accompanying literature will be discarded after the initial use
and the absence of the warning statements in Finding 9 on the tube
creates the potential for serious harm to human health.
944
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12. In letters dated August 29, 1972, and December 14, 1972,
pesticides enforcement officials of EPA advised respondent that
statements "For professional pesticide control operator and govern-
ment agency use only" and "Not for use in or around the home" must
appear on the tube label. This requirement was based on the
interpretation in 40 CFR 162.124, which was issued on March 22,
1969 (34 F.R. 5537). This requirement was beyond the scope of the
statute and failure of the label to bear these statements did not
constitute misbranding.
13. The respondent's gross sales in 1972 and 1973 were
approximately $275,000 and $290,000, respectively. The number of
its full-time employees varies from 9 to 12 depending on the busy
season of the company.
14. Adverse weather conditions which affect growers are
reflected in their reduction of purchases of products from respondent.
During the past five years such weather conditions have resulted in a
decline in respondent's sales and profits. Improved seasonal weather
conditions will favorably affect respondent's business. A forced move
of respondent's business premises several years ago has contributed
to a decline in its profits.
15. The respondent's net profit decreased from about $33,000
in 1967 to $540 in 1970. Net profit in 1971 was $2,300 and in 1972,
$3,045; in 1973 there was a loss of $1,200. Despite this record of
profits in recent years, the respondent has chosen to remain in
business with the hope and expectation that business will improve.
16. In November 1972, the net worth of the respondent
partnership, excluding the value of the home owned by the partners
and four acres of land, was in excess of $400,000. The partners have
equity in the home and four acres of land of approximately
$200,000.
17. While there may have been some changes or fluctuations in
the financial condition of respondent since November 1972, the
penalties assessed, as hereinafter set forth, will not effect the
respondent's ability to continue in business.
945
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18. Between 1969 and 1972, 25 citations were issued against
respondent in which violations were alleged relating to interstate
shipments of pesticides. The respondent did not contest any of said
citations. In December 1972, the Agency recommended criminal
prosecution against respondent for alleged violations in connection
with samples of five products. Enforcement by way of civil penalty
having become available under FIFRA 1972, the recommendation for
criminal prosecution was withdrawn. Subsequently, the violations
which are the subject of the instant proceedings were discovered.
19. With regard to the Rotenone product the same proof will
support the charges of misbranding and adulteration relating to the
deficiency of rotenone and a single penalty is imposed for these
violations. An appropriate penalty is $500.
20. With regard to the Azalea Dust product this was a single
shipment and caused by negligence of respondent's employees. The
same proof will support the charges of misbranding and adulteration
with regard to the zinc ethylene bisdithiocarbamate deficiency and a
single penalty is imposed for these violations. An appropriate penalty
is $500. Similarly, the same proof will support the misbranding and
adulteration charges with regard to the presence of chlordane and a
single penalty is imposed for this violation. An appropriate penalty is
$500. With regard to the nonregistration charge and the misbranding
charge that the label bore a registration number, the violations are
closely interrelated and a single penalty is imposed. An appropriate
penalty is $1,000.
21. With regard to the Poison Paste product, which is highly
toxic and which did not bear the warning and caution statements
which were required and which respondent was advised should be on
the tube as set forth in Finding 9, a single penalty is imposed for
failure to bear the required statements. An appropriate penalty is
$1,500.
Conclusions
1. On February 13, 1973, the respondent shipped the pesticide
Gulf States 5% Rotenone from Mobile, Alabama, to Paducah,
946
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Kentucky. Said pesticide was adulterated and misbranded within the
meaning of the Federal Insecticide, Fungicide, and Rodenticide Act,
as amended. The respondent violated section 12(a) of said Act and is
subject to the assessment of a civil penalty under section 14(a) of said
Act. An appropriate penalty for the violations relating to this
shipment is $500.
2. On February 6, 1973, the respondent shipped the pesticide
Azalea Petal Blight Dust from Mobile, Alabama, to Pensacola,
Florida. Said pesticide was not registered as required by Federal
Insecticide, Fungicide, and Rodenticide Act, as amended and was
misbranded and adulterated within the meaning of said Act. The
respondent violated section 12(a) of said Act and is subject to the
assessment of a civil penalty under section 14(a) of said Act. An
appropriate penalty for the violations relating to this shipment is
$2,000.
3. On January 30, 1973, the respondent shipped the pesticide
Pearson's Poison Paste from Mobile, Alabama, to Shreveport,
Louisiana. Said pesticide was misbranded within the meaning of
Federal Insecticide, Fungicide, and Rodenticide Act, as amended. The
respondent violated section 12(a) of said Act and is subject to the
assessment of a civil penalty under section 14(a) of said Act. An
appropriate penalty for the violations relating to this shipment is
$1,500.
4. In assessing the above penalties, totaling $4,000, there has
been taken into consideration the size of respondent's business, the
effect on respondent's ability to continue in business, and the gravity
of the violations.
As above noted, the respondent did not contest the charges with
regard to the Rotenone product in which there was an 18.06%
deficiency of rotenone. The complainant does not claim that this
deficiency would present any potential harm to man or the
environment. However, with such a deficiency the efficacy of the
product is reduced and in this respect the purchaser is misled and
defrauded. Further, this deficiency, which is substantial, is evidence
of inadequate quality control by respondent. In this connection, it is
947
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also noted that on other occasions the respondent had been cited for
deficiences in its rotenone products.
The deficiency of rotenone resulted in the product being both
misbranded and adulterated. It is the policy of EPA enforcement
officials to assess separate civil penalties for each independent and
substantially distinguishable charge and to assess only a single
penalty where one charge derives primarily from another charge cited
in the complaint (see Ex. 8, Sec. V-B). This policy undoubtedly is de-
rived from court rulings which hold that "where the same act or
transaction constitutes a violation of two distinct statutory provisions,
the test to be applied to determine whether there are two offenses or
only one is whether each provision requires proof of an additional
fact which the other does not." Blockburger v. U.S., 284 U.S. 299,
304 (1932); Tesciona v. Hunter, 151 F. 2d 589, 591~(10th Gr. 1945).
With regard to the Rotenone product, the same evidence will
establish the misbranding and adulteration violations without proof
of additional facts in either instance and a single penalty is imposed
for these violations.
Again, in the Azalea Dust product, the respondent did not
contest the charges. The registration of this product had been
cancelled in May 1971. Through negligence of one of respondent's
employees, the cancellation was not listed in respondent's records
and when an order for this product was received in February 1973, a
total of 312 pounds was shipped. Thus, a non-registered product was
shipped and its label bore a registration number. The product was
22.6% deficient in the active ingredient listed on the label which re-
sulted in the product being adulterated and misbranded. It also
contained an additional active ingredient that was not listed which
also resulted in adulteration and misbranding.
As in the Rotenone product, the deficiency reduced efficacy and
the purchaser was misled and defrauded. The deficiency and the
presence of an unlisted ingredient again indicated inadequate
quality control.
948
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A single penalty is imposed for the adulteration and mis-
branding by reason of the deficiency and a separate civil penalty is
imposed by reason of the presence of an unlisted ingredient. The non-
registration charge and the misbranding charge that the label bore a
registration number are so closely interrelated that a single penalty is
imposed for these violations.
The respondent has contested the charges with respect to the
Poison Paste product. The product was alleged to be misbranded
because it did not bear certain required warning or caution
statements. In particular, it is claimed that the front panel of the label
on the tube did not bear the words "See antidote statement on back
panel" and the label did not bear the following statements "May be
fatal if swallowed", "For professional pest control operator and
government agency use only", "Not for use in or around the home."
The respondent argues that section 4(d) of the Federal
Environmental Pesticide Control Act of 1972 (FEPCA) precludes the
assessment of civil penalties for failure of the label to bear the
warning and caution statement which complainant charges resulted
in misbranding. This section provided as follows:
No person shall be subject to any criminal or civil penalty
imposed by the Federal Insecticide, Fungicide, and
Rodenticide Act, as amended by this Act, for any act (or
failure to act) occurring before the expiration of 60 days
after the Administrator has published effective
regulations in the Federal Register and taken such other
action as may be necessary to permit compliance with the
provisions under which the penalty is to be imposed.
It is apparent that the purpose of this provision is to give persons
whose activities come within the purview of the statute reasonable
notice of any new requirements so that they could conform their
conduct and operations to such requirements.
The pertinent charge against respondent with regard to Poison
Paste is misbranding as defined in 7 U.S.C. 136{q)(l)(G) — failure of
the label to bear the required warning or caution statement. This
949
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provision is a new formulation of and, so far as here material, the
same as misbranding as defined in the Act before amended, 7 U.S.C.
135(z)(2)(d). Explanatory regulations as to label requirements had
been issued under this section, 40 CFR 162.9.
On January 4, 1973, the Administrator of EPA issued an Imple-
mentation Plan for FIFRA 1972. This was published in the Federal
Register on January 9, 1973, 38 F.R. 1142. Under the heading of
"Definitions" the Administrator stated:
insofar as explanatory regulations may be desirable to
furnish guidance to the public, regulations presently in
force will be continued where applicable.
The regulations as to label requirements are equally applicable
under the pertinent definitions of misbranding in the Act before and
after amendment and new regulations were not required to define
misbranding in this regard. The notice in the Federal Register
continued the effectiveness of these regulations which were
"presently in force." Further, it is important to note that other action
had been taken to permit respondent to comply with the label
requirements. In the letter of November 1, 1972 (after the enactment
of FIFRA 1972), the respondent was specifically advised that the
statements in question were required on the label (Ex. 6). The
respondent had personal notice of the requirements and ample
opportunity to comply with them before making the illegal shipment
in question.
tt is respondent's contention that EPA is estopped from asserting
the labeling violations with regard to Poison Paste because it failed to
review the labeling it had submitted on November 27, 1972, and ad-
vise it of the results as promised in its letter of December 14, 1972.
We find this argument to be without merit.
In considering this argument, we must recognize at the outset
the difference between label and labeling. Section 2(p)(1) of the Act
(7 U.S.C. 136(p)(l)), in pertinent part, defines label to mean written,
printed, or graphic matter on, or attached to, the pesticide or any of
its containers or wrappers. Section 2(p)(2) (7 U.S.C. 136(p)(2)) defines
950
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labeling to mean all labels and all other written, printed, or graphic
matter accompanying the pesticide at any time.
The alleged misbranding violations in the complaint relate to the
label of the product. In letters to the respondent prior to December
14, 1972, the pesticide enforcement officials of EPA had specifically
pointed out its claim of inadequacies in the label. There was never
any indication that EPA had changed its position as to these label
requirements. The material that respondent submitted on November
27, 1972, which was to be reviewed was "package labeling". Failure
of EPA to advise respondent of the results of the review of labeling
does not excuse respondent from complying with proper and explicit
requirements as to content of label. It is significant to note the letter
of December 14, 1972, repeated the requirement that the label must
bear the statement "May be fatal if swallowed."
As to the antidote statement, the applicable regulations require
such statement on the front panel but reasonable variations are
permitted in the placement of such statement if some reference to
such as "See antidote statement on back panel" appears on the front
panel. 40 CFR 162.9(b). The respondent was notified of this
requirement by letter from EPA dated November 1, 1972. Failure to
bear the proper antidote statement resulted in misbranding.
The respondent argues that 40 CFR 162.116(d) does not require
the "fatal if swallowed" warning on products containing more than
1 % phosphorus. (The product in question contained 2 % phosphorus.)
This section sets forth or indicates acceptable warning, etc. and
states "The manufacturer is obligated to use any added warning,
caution or antidote statements which any special characteristics or
uses of his formulation indicate to be necessary." Further, section
162.9 provides "The label of every economic poison shall bear warn-
ings or cautions which are necessary for the protection of the public..
. as the Director may prescribe . . .". The Director in the letter of
November 1, 1972, specifically notified respondent that the tube
must bear the "fatal if swallowed" statement. Although the product
was not supposed to be used in the home, the 2 ounce tube is parti-
cularly adaptable for home use and it was undoubtedly the view of
the Director that the "fatal if swallowed" statement on such tube was
951
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necessary for the protection of the public. The respondent's failure to
include this statement on the tube was in direct contravention of the
Director's notification and resulted in misbranding.
We turn now to the "professional use" and "not for home use"
statements. In Stearns Electric Paste Co. v. EPA, 461 F.2d 293 (7th
Cir. ,1972), a product containing phosphorus, similar to Pearson's
Poison Paste, was involved. The registration of the Stearns product
had been cancelled on the ground that phosphorus paste is too
poisonous for use in the home except by commerical pest control
operators. This cancellation followed the issuance of Interpretation
26 on March 19, 1969, (34 F.R. 5537) 40 CFR 162.124. The court,
after tracing the history and purpose of FIFRA, held in substance that
a product of this composition, with adequate warnings and
statements on the label, could not be banned from home use, and the
court concluded that the cancellation order must be set aside. We are
of the view that the court ruling supersedes the Agency in-
terpretation. The purpose sought to be accomplished under In-
terpretation 26 may now be available under section 3(d) of FIFRA, as
amended (7 U.S.C 136a).
There was considerable evidence at the hearing regarding the
Civil Penalty Assessment Schedule used by the Regional Offices of
EPA. The complainant introduced this as an exhibit at the hearing.
The individual cases under the civil penalty enforcement
program are handled by the appropriate Regional Offices of which
there are ten. In the hope of achieving uniformity in the amount of
penalty assessed in the various regions for violations of comparable
gravity, the Pesticides Enforcement Division, in Washington, D.C., in
collaboration with regional personnel developed the schedule. In
determining the amount of the penalty, the statute requires the
Agency to consider the appropriateness of the penalty to the size of
respondent's business, the effect on his ability to continue in business,
and the gravity of the violation.
The schedule was set up with a range of dollar amount penalties
for the violations of various types. In setting up the schedule, primary
consideration was given to two factors — gravity of the violation and
952
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size of respondent's business. The third factor — the effect on
respondent's ability to continue in business — was considered to
have some relationship to the size of respondent's business. A
respondent is given the opportunity at the regional level, before an
administrative hearing is held, to contest the alleged violation and the
appropriateness of the penalty. The respondent may also submit
evidence on the three factors to be considered at a formal hearing,
such as was held in this case.
The use of the schedule is not a covert operation by the regional
officials and its use is readily acknowledged. It has not been
published and, so far as we are aware, publication is not required.3 It
is undoubtedly proper and desirable for the enforcement officials to
be guided by the schedule. However, we are of the view that the
Administrative Law Judge who hears the case is not bound by it.
Section 14(a)(3) of the Act (7 U.S.C. 136_[ (a)(3)), as we read it, con-
templates an administrative hearing not only on the matter of
violations, but also on the appropriateness of the penalty. The
Administrative Law Judge who hears the case must make an in-
dependent judgment on both of these factors. He may look to the
schedule to learn the basis on which the enforcement officials arrived
at the amount of the proposed penalty. But, the evidence before him
may be different from that which was before the enforcement
officials or, if the same, he may not agree with their evaluation of it.
Accordingly, if he finds a violation he may increase (within the limits
of the statute) or decrease the amount of the penalty proposed by the
enforcement officials.
Particular attention has been given to respondent's claim that a
sizeable penalty will effect its ability to continue in business. The
imposition of the penalties herein assessed will not effect
respondent's ability to continue in business. There are other factors
more important, e.g., improved business conditions, favorable
weather conditions and Mr. Pearson's age. The imposition of the
penalties may influence respondent in deciding whether it desires to
continue in business, but it will not affect its ability to do so.
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The penalties assessed herein are at variance with those set
forth in the assessment schedule, but in our view, they are
appropriate in light of the factors that must be considered.
The proposed Findings of Fact and Conclusions submitted by the
parties have been considered. To the extent that they are consistent
with Findings of Fact and Conclusions herein, they are granted,
otherwise they are denied.
Having considered the entire record and based on the Findings
of Fact and Conclusions herein, it is proposed that the following order
be issued.
Final Order
Pursuant to section 14(a)(l) of the Federal Insecticide,
Fungicide, and Rodenticide Act, as amended (7 U.S.C. 136 1 (a)(l)),
civil penalties totaling $4,000 are assessed against respondent
Pearson & Company, Mobile, Alabama (C. Ferrell Pearson and
Gertrude R. Pearson, Co-partners), for violations of said Act which
have been established on the basis of complaints issued on November
2,1973.
Bernard D. Levinson
Administrative Law Judge
May 31,1974
1 The complaints were designated "Penalty Assessment and Notice
of Opportunity for Hearing."
2 This statutory reference in the complaint is obviously incorrect —
there is no such subsection. It is apparent that the reference should
have been to 7 U.S.C. 136(q)(2)(C)(v). The respondent has raised no
question concerning this matter.
954
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3 We are informed that a Civil Penalty Assessment Schedule will be
published together with the final Rules of Practice.
1479. In Re: Southern Mill Creek Products, Inc., EPA Region IV,
July 22, 1974, (I.F.&R. No. IV-13C, I.D. Nos. 88486 and
88575.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
135a(a)(1) and 135b. The action pertained to shipments made on
April 9 and May 16, 1973, from Tampa, Florida, to Tuscaloosa and
Gadsden, Alabama. The pesticides involved were SMCP
MALATHION ULV CONCENTRATE and MALATHION ULV
CONCENTRATE; the respondent requested a hearing in which he
raised two defenses to the charges set forth in the complaint. After
the ruling by the Administrative Law Judge that the respondent's
defenses were not applicable to the charges in the complaint, the
respondent signed a Consent Agreement. The Final Order assessed a
civil penalty of $2,500.00.
The following is Administrative Law Judge Bernard D. Levinson's rul-
ing on the defenses.
Ruling On First And Second Defenses Of Respondent's Answers
On November 2, 1973, two complaints ' were issued against the
Respondent proposing to assess civil penalties pursuant to section
14(a) of the Federal Insecticide, Fungicide, and Rodenticide Act, as
amended (hereinafter FIFRA 1972), Public Law 92-516, October 21,
1972 (7 U.S.C. 136_[(a)) for alleged violations of section 12 of the
Act. FIFRA 1972 amended the Federal Insecticide, Fungicide, and
Rodenticide Act of 1947 (hereinafter FIFRA 1947).
Interim Rule of Practice governing proceedings conducted in the
assessment of civil penalties under FIFRA were promulgated on
September 14, 1973, and published in the Federal Register on
September 20, 1973, 28 F.R. 26360 (hereinafter the Rules), which
added a new Part 168 to Title 40, Code of Federal Regulations. By
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order dated December 4, 1973, the two proceedings were con-
solidated by the Administrative Law Judge pursuant to section
168.22 of the Rules.
Each complaint alleges that respondent violated section 12 of
the Act by delivering for shipment from Tampa, Florida, to a city in
another state,2 a pesticide that was "not registered under section 4
of theAct.3(7U.S.C 135a(a)(l), 135b)."
The Respondent filed timely answers and requests for hearing.
Each answer raises the same two legal defenses which the
Administrative Law Judge considered should be disposed of before
proceeding further with the case. 4 At the request of the
Administrative Law Judge, the parties have filed memoranda of law
in support of their positions.
The first defense alleges that the complaint fails to state a claim
for civil penalty against Respondent pursuant to section 4 of FIFRA,
as amended, s and 40 CFR 168.31 (a) in that it fails to set forth a
concise statement of the factual basts for the alleged violation and
refers to a statutory section not relevant to the proceeding. The
second defense alleges that the Agency is without jurisdiction to
impose a civil penalty on Respondent, as (1) the alleged violation
occurred before the publication of effective regulations in the Federal
Register and (2) 7 U.S.C. 136 1 by its terms is not applicable to a vio-
lation of 7 U.S.C. 135a(a)(l) and 135b.
I.
Effectiveness Of The Registration Requirement Under FIFRA 1947
The first Federal regulation of pesticides was under the Federal
Insecticide Act of 1910. Under this law, there was no requirement for
registration. This Act was repealed in 1947 and replaced with the
Federal Insecticide, Fungicide, and Rodenticide Act, FIFRA 1947. This
Act, for the first time, required registration of pesticides (which in the
Act were designed as "economic poisons"). Among the purposes of
registration, were to provide additional protection to the public; to
assist manufacturers in complying with the provision of the Act; to
956
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bring to the attention of enforcement officials the formula, label, and
claims made with respect to pesticides before they are offered to the
public; to prevent false and misleading claims; to prevent worthless
articles from being marketed, and to provide a means of obtaining
speedy remedial action if such articles are marketed. "Thus, a great
measure of protection can be accorded directly through the pre-
vention of injury, rather than having to resort solely to imposition of
sanctions for violations after damage or injury has been done.
Registration will also afford manufacturers an opportunity to
eliminate many objectionable features from their labels prior to
placing an economic poison on the market." H.R. Rep. No. 813, 80th
Cong., 1st Sess., 1947, pp. 2-3.
In 1959 and 1964, there were amendments to the 1947 Act,
which are not here material. The 1972 Act resulted in extensive
amendments to the 1947 Act. It is to be observed that the 1972
enactment amended the 1947 law and did not repeal it.
The legislative mechanism used in 1972 to amend FIFRA 1947
was designated Federal Environmental Pesticide Control Act of 1972
(hereinafter FEPCA). The 1972 amendments retained the basic
requirements and purposes of registration but changed some of the
procedures relating thereto and also provided for classification of
pesticides for general and/or restricted use.
Section 4 of FEPCA, entitled "Effective Dates of Provisions of
Act," 6 provides in pertinent part as follows:
(a) Except as other wise provided in the Federal Insecticide,
Fungicide, and Rodenticide Act, as amended by this Act, and as
otherwise provided by this section, the amendments made by
this Act shall take effect at the close of the date of the enact-
ment of this Act, provided if regulations are necessary for the
implementation of any provision that becomes effective on the
date of enactment, such regulations shall be promulgated and
shall become effective within 90 days from the date of
enactment of this Act.
957
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(b) The provisions of the Federal Insecticide, Fungicide, and
Rodenticide Act and the regulations thereunder as such existed
prior to the enactment of this Act shall remain in effect until
superseded by the amendments made by this Act and re-
gulations thereunder: Provided, That all provisions made by
these amendments and all regulations thereunder shall be
effective within four years after the enactment of this Act.
(c)(l) Two years after the enactment of this Act the Administra-
tor shall have promulgated regulations providing for the
registration and classification of pesticides under the provisions
of this Act and thereafter shall register all new applications
under such provisions.
(c}(2) After two years but within four years after the enactment
of this Act the Administrator shall register and reclassify
pesticides registered under the provisions of the Federal In-
secticide, Fungicide, and Rodenficide Act prior to the effective
date of the regulations promulgated under subsection(c)O).
(d) No person shall be subject to any criminal or civil penalty
imposed by the Federal Insecticide, Fungicide, and Rodenticide
Act, as amended by this Act, for any act (or failure to act)
occurring before the expiration of 60 days after the
Administrator has published effective regulations in the Federal
Register and taken such other action as may be necessary to
permit compliance with the provisions under which the penalty is
to be imposed.
(e) For purposes of determining any criminal or civil penalty or
liability to any third person in respect of any act or omission
occurring before the expiration of the periods referred to in this
section, the Federal Insecticide. Fungicide, and Rodenticide Act
shall be treated as continuing in effect as if this Act had not
been enacted.
Section 3(a)(l) of FIFRA 1947, 7 U.S.C 135a(a)(l), among other
things, prohibited the interstate shipment of any economic poison
958
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that is not registered pursuant to section 4, 7 U.S.C. 135(b). Section 4
of FIFRA 1947, 7 U.S.C. 135b, required, among other things, that
every economic poison which is shipped or delivered for shipment in
interstate commerce be registered. Section 12(a)(l)(A) of FIFRA 1972,
7 U.S.C. 136j(a)(l)(A) and section 3 of FIFRA 1972,7 U.S.C. 136a(a),
respectively, are comparable to the foregoing sections of FIFRA
1947. Section 12(a)(l)(A) of FIFRA 1972 prohibits the shipment of an
unregistered pesticide and section 3 requires the regulation of
pesticides in commerce.
It is a bisic principle of statutory construction that the various
provisions of a statute must be construed together. We look at
sections 4(b) and 4(c)(l) of FEPCA. Section 4(c)(l) grants the
Administrator of EPA two years within which to promulgate
regulations providing for the registration of pesticides under the
provisions of this Act. Section 4(b) states that the provision of FIFRA
1947 and the regulations thereunder as such existed prior to the
enactment of FIFRA 1972, shall remain in effect until superseded by
the amendments made by this Act and regulations thereunder. The
regulations under FIFRA 1947 relating to registration of pesticides
appear in 40 CFR 162.10. Since Congress granted the Administrator
two years within which to promulgate regulations providing for
registration of pesticides and further provided that the provisions of
FIFRA 1947 and regulations thereunder, shall remain in effect until
superseded by the new amendments and regulations thereunder, it is
clear that Congress intended that the registration provisions of FIFRA
1947 and regulations thereunder shall remain in effect until new
regulations under FIFRA 1972 are promulgated and that the new
regulations must be promulgated within two years after October 21,
1972.
The two years allowed for promulgating of new regulations pro-
viding for registration of pesticides has not expired and new
regulations have not been promulgated. Thus, the requirement of
registration under FIFRA 1947 and regulations thereunder are still in
effect and will remain so until regulations for registration are
promulgated under FIFRA 1972.
959
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This conclusion is fortified by section 4(c)(2) of FEPCA which pro-
vides that after two years (the time limit for promulgating new re-
gistration regulations) but within four years, the Administrator shall
register and reclassif y pesticides which were registered under the pro-
visions of FIFRA 1947 "prior to the effective date of the regulations
promulgated under subsection (c)(l)." It is apparent that Congress
intended that the registration requirement of FIFRA 1947 and
regulations thereunder should remain in effect until superseded within
two years by new regulations under FIFRA 1972 and that re-
gistrations under FIFRA 1947 should remain in effect until registered
under the new regulations, which must be accomplished within four
years. We cannot impute to Congress the intent to leave EPA with-
out any registration requirements or regulations relating thereto for a
period of time up to two years and the possibility of having
unregistered pesticides marketed for four years.
II.
Effectiveness of Section 14(a) of FIFRA 1972,7 U.S.C 136 1
Section 14(a) of FIFRA 1972, provides for the imposition of civil
penalties for violations of the Act.
Section 4(a) of FEPCA, states in substance that the amendments
therein shall take effect on enactment except as otherwise provided
or "if regulations are necessary for the implementation of any of
provisions that becomes effective on date of enactment," such re-
gulations shall be promulgated and become effective within 90 days
from date of enactment.
An analysis of section 14(a) does not disclose that any re-
gulations are necessary for its implementation. The substance of
14(a)(l), with which we are here concerned, simply states that any
person in the categories listed who violates any provision of this Act
shall be assessed a civil penalty by the Administrator of not more than
$5,000 for each offense. We have but to look to the prohibited acts
to ascertain if the person charged performed an unlawful act. As
above concluded, under Section I herein, the requirements and
regulations under FIFRA 1947 relating to registration of pesticides,
960
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remained in effect when FIFRA 1972 was enacted and were in effect
when the alleged violation occurred. Further, there is nothing in
section 4 of FEPCA that requires new regulations for the enforcement
of nonregistration violation.
As above indicated, the basic requirements for registration of
pesticides shipped in interstate commerce (with" which we are here
concerned), are the same under FIFRA 1947 and FIFRA 1972. *
Whether we look to FIFRA 1947 or FIFRA 1972, the act of shipping
an unregistered pesticide in interstate commerce was and is a
violation.
Section 4(d) of FEPCA does not preclude the effective operation
of section 14(a) of FIFRA 1972 on the date of enactment. The purpose
of section 4(d) is to prevent the enforcement of new regulatory
requirements without notice and without the Administrator having
taken such other action as may be necessary to permit compliance
with the provisions under which the penalty is to be imposed.
The Conference Report on the 1972 amendments, S. Rep. No.
92-1540, p. 33, in explaining section 4(d) states, in part, as follows:
It makes penalties effective only after the Administrator
has taken such action as may be necessary to permit
compliance (as well as having issued regulations).
The Report gives several illustrations that are new requirements
under FIFRA 1972, e.g., failure to have a plant registration number on
a label and failure to comply with provisions relating to extension of
the Act to intrastate commerce. Certainly, if new regulations were
required to implement provisions of FIFRA 1972, such regulations
would have to be published in the Federal Register and no person
would be subject to criminal or civil penalty for a violation "occurring
before the expiration of 60 days after the Administrator has pub-
lished effective regulations ... and taken such other action as may be
necessary to permit compliance ...."
As above noted, regulations regarding registration under FIFRA
1947 had been issued and were in effect when FIFRA 1972 was
961
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enacted. These appeared in 40 CFR 162.10. The regulations and
amendments were published in the Federal Register, 36 F.R. 24802.
On January 9, 1973, an "Implementation Plan, Pesticide
Control Act", issued by the Administrator, EPA, was published in the
Federal Register, 38 F.R. 1142, et seq. This set forth the views of the
Agency regarding the implementation of FIFRA 1972. At p. 1443, it is
stated:
Until such time as regulations are issued to implement the
registration procedures of the new Act, all provisions and
pertinent rules and regulations governing registrations
under the 1947 FIFRA will remain in full force and effect.
This could be considered as a republication of the existing re-
gulations relating to registration. At least, it put all parties on notice
that the pertinent regulations under FIFRA 1947 were in force and ef-
fect and that compliance with them was required. The Administrator
had not only published effective regulations in the Federal Register,
but had "taken such other action as may be necessary to permit
compliance with the provisions under which the penalty is to
imposed."
We have not overlooked the statements in the legislative reports
relating to section 4 of FEPCA.
A House proposal as to the contents of section 4(d) provided as
follows (see H.R. 10729, Sept. 16, 1971, and as reported to House
Sept. 25,1971, Union Calendar 235):
(Section 4)(d) No person shall be subject to any criminal
or civil penalty imposed by the Federal Insecticide,
Fungicide, and Rodenticide Act, as amended by this Act,
for any act (or failure to act) occurring before the
expiration of 60 days (after final regulations (relating to
such penalty) under the Federal Insecticide, Fungicide,
and Rodenticide Act, as amended, are published in the
Federal Register.) (Brackets added.)
962
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This amendment could be construed as requiring procedural re-
gulations relating to penalties, both criminal and civil. The Senate,
apparently realizing the undesirability of including a requirement for
procedural regulations relating to penalties, struck the final phrase
"final regulations (relating to such penalty) under the Federal
Insecticide, Fungicide, and Rodenticide Act, as amended, are
published in the Federal Register1' and substituted the language in
the bill which was enacted, to wit, "after the Administrator has
published effective regulations in the Federal Register and taken such
other action as may be necessary to permit compliance with the pro-
visions under which the penalty is to be imposed."
In commenting on the House proposal, which required reguulations
relating to penalties, the House Committee stated (H.R. Rep. No.
92-511):
In addition to the foregoing, the Administrator shall
publish in the Federal Register regulations relating to
criminal and civil penalty, and no person shall be subject
to such a penalty under the amendments of this Act until
60 days after publication of the final regulations.
This comment by the House Committee, while it may have been
appropriate to a bill that required penalty regulations, is
inappropriate to the bill as enacted which requires no penalty
regulations. Although the Senate amendment eliminated the
requirement of penalty regulations, in the Senate Committee Report,
S. Rep. No. 92-838, it adopted the same comment as in the House
report and added the phrase "and taken such other action as may be
necessary to permit compliance."
It is common practice for a Committee of one of the Houses of
Congress in its report on a particular bill to adopt the language from
the Committee report of the other House. It must be concluded that it
was an oversight on the part of the Senate Committee to adopt the
language of the House report regarding the requirement of penalty
regulations when the Senate bill had eliminated such requirement.
963
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On further comment on this subject. Section 4(e) of FEPCA
states, in pertinent part:
For purposes of determining any ... civil penalty... in re-
spect to any act or omission occurring before the
expiration of the periods referred to in this section, the
Federal Insecticide, Fungicide, and Rodenticide Act shall
be treated as continuing in effect as if this Act had not
been enacted."
The period we are here concerned with is the two-year period
after October 21, 1972, within which the Administrator is required to
issue regulations providing for registration (section 4(c)(l)). There
were no civil penalty provisions in FIFRA prior to the 1972
amendments. Since the registration requirements and regulations of
FIFRA 1947 are effective until superseded by the amendments of
1972 and regulations thereunder, it is apparent from section 4(e) that
Congress intended the immediate avialability of civil penalty
enforcement for violations of the registration requirements under
FIFRA 1947.
The Agency Construction of Section 14{a) of FIFRA 1972
The implementaiton statement above referred to, published in
the Federal Register, on January 9, 1973, considered section 4 of
FEPCA, and particularly section 4(d). The statement contains the
following at 38 F.R. 1143:
It is the Agency's view that, with certain exceptions
section 4 makes the 1972 amendments effective as of the
date of their enactment. These exceptions concern
primarily the registration, classification, and the certi-
fication of applicator sections. In addition, those sections
where regulations are "necessary" do, not become
effective until 60 days after final regulations are
promulgated. This provision in the Agency's view, refers
only to those sections of the amendments where the
964
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Congress has expressly directed the Agency to prepare
regulations, e.g., the provisions for licensing pesticide
producing establishments. [Emphasis added.)
With regard to section 14, the statement provided (38 F.R. at
1144):
Section 14(a) of Public Law 92-516 became effective on
October 22, 1972. This provision will be implemented
when policy and procedures are developed. Section 14(b)
of Public Law 92-516 became effective on October 22,
1972. These increased criminal penalties apply to all
violations occurring on or after October 22, 1972,
whether unlawful acts are cited under the FIFRA of 1947
or under Public Law 92-516. (Emphasis added.)
The Agency construed section 14(a), as well as 14(b) relating to
criminal penalties, to be immediately effective. Obviously, it became
Agency policy to bring actions to enforce the civil penalty provision. '
It is apparent that procedures were developed for prosecuting such
cases. 10 (See pages 2 and 3 of Complaint). This Respondent (and
presumably others) were informed as to the basic procedures of
requesting a hearing, filing answer, etc. and were also informed that
a hearing, if requested, would be conducted in accordance with the
provisions of the Administrative Procedure Act. (5 U.S.C. 552, et
seq.).
It is a well established principle of statutory construction that
contemporaneous construction of a statute by the Agency that is
charged with its administration, is entitled to great weight. The
Government brief cites numerous judicial precedents in support of this
proposition. It is sufficient to quote from one, particularly pertinent. In
Udall v. Tollman, 380 U.S. 1 (1965), the Supreme Court said at p. 16:
When faced with a problem of statutory construction, this
Court shows great deference to the interpretation given
the statute by the officers or agency charged with its
administration. 'To sustain the Commission's application
of this statutory term, we need not find that its con-
965
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struction is the only reasonable one, or even that it is the
result we would have reached had the question arisen in
the first instance in judicial proceeding/ (cases cited).
'Particularly, is this respect due when the administrative
practice at stake involves a contemporaneous con-
struction of a statute by the men charged with the
responsibility of setting its machinery in motion, of
making the parts working efficiently and smoothly while
they are yet untired and new.1 (case cited).
We conclude that the Agency construction of FIFRA 1972: (1)
that section 14(a) was immediately effective and (2) that the
registration requirements and regulations under FIFRA 1947 are
effective until superseded by new regulations (within two years after
October 21,1972), are reasonable, if not required.
IV.
Whether the Rules of Practice Result in Retroactive Application of
Section 14(a)
As above concluded, section 14(a) of FIFRA 1972, the civil
penalty provision was effective on enactment and substantive
regulations were not necessary to implement its enforcement. Since
enforcement of the civil penalty provision was on a Regional basis, it
was desirable, if not necessary, that there be uniform Rules of
Practice for implementing enforcement.
The Rules of Practice that were published in the Federal Register
do not amend or modify the substantive provisions of section 14(a).
The Rules, as stated therein, "govern all proceedings conducted in the
assessment of a civil penalty, as provided in section 14(a)." It is
further stated that "the Rules provide a procedure for assessment of
civil penalties" and "establish a mechanism" for issuing complaints,
and whereby Respondent may contest liability and the appropriate-
ness of the penalty. The Rules were issued under the general authority
granted to the Administrator in section 25(a) of FIFRA 1972 "to
prescribe regulations to carry out the provisions of this Act."
966
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The Rules do not create any unlawful acts nor do they impose
any substantive obligations to meet the requirements of the Act. The
Rules relate solely to procedures for enforcement of the penalty
provision after violations have occurred.
The Rules do not affect Respondent's substantive rights. A
change in procedure for enforceing existing liabilities, whether the
liabilities accrued before or after the change in procedure, are sub-
jected to the new procedure. Beatty v. U.S., 191 F. 2d 317 (8th Cir.
1951); N.LR.B. v. National Garment Co., 166 F.2d 233 (8th Cir.
1948), cert, denied, 334 U.S. 645; U.S. v. Haughton, 413 F.2d 736
(9th Cir. 1969);Untersignerv. U.S., 181 F. 2d 953 (2d Cir. 1950). This
Respondent is charged with a violation that occurred after the enact-
ment of FIFRA 1972. The cases go even further and hold that a new
procedural remedy may be applied to violations of existing,
substantive provisions, which occurred even before the enactment of
the new remedy. See Miller v. United States, 196 F. 2d 937 (5th Cir.
1951): Montana Power v. FPC, 445 F.2d 739,747 (D.C. Cir. 1970).
V.
Adequacy of Charges In The Complaints
The Respondent urges that the Complaints are ambiguous and
fail to give notice of the charges which it is called upon to defend or
the laws which it is accused of violating. The Respondent also points
out that section 168.31 (a) of the Rules of Practice requires that the
Complaint shall contain specific reference to the provision of the Act
alleged to have been violated and a concise statement of the factual
basis for the alleged violations.
The Complaints do contain concise statements of the factual
basis for the alleged violations. Each complaint alleges that a named
pesticide was delivered for shipment on a specified date from Tampa
to a city in another state and that each pesticide was not in
compliance with the provisions of the Act because it was not
registered. These are complete and concise statements of the factual
basis for the alleged violation.
967
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It must be acknowledged that there is an inconsistency in the
citation of the statutory references for the alleged violations. It is
stated that the "penalty is based on a determination of violation of
section 12 of the Act by delivering for shipment, the pesticide..." for
interstate shipment. The reference is to section 12 of FIFRA 1972
wherein shipment of an unregistered pesticide is declared to be
unlawful [section 12(a)(l)(A)). However, the statutory references given
are 7 U.S.C. 135{a)(a)(l) and 135(b). These are the references to
FIFRA 1947 for unlawful interstate shipment of an economic poison
and the requirement for registration. While the inconsistency should
be cured by amendment, we do not consider it to be a fatal defect.
Interstate shipment of an unregistered pesticide is a violation
both under FIFRA 1947 and FIFRA 1972 and the Respondent has not
been misled by the allegations in the Complaint. It is clear from
Respondent's brief that it is fully aware of the nature of the charges
against it and what its unlawful acts are alleged to be. The
Respondent has reasonably been apprised of the issue in controversy.
It was said in Cella v. United States, 208 F.2d 783 (7th Cir. 1953),
cert, denied, 347 U.S. 1016;
In an administrative proceeding it is only necessary that
the one proceeded against be reasonably apprised of the
issues in controversy, and any such notice is adequate in
the absence of a showing that the party was misled.
See also Golden Grain Macaroni Co. v. F.T.C., 474 F.2d 882
(9th Cir. 1972); L G. Balfour Co. v. F.T.C., 442 F.2d 1 (7th Cir. 1971);
Davis Administrative Law Treatise, Sec. 8.04.
Conclusion
It is concluded that the First and Second Defenses set forth in
Respondent's Answers are not applicable and furnish no defense to
the charges in the Complaints. The said defenses are overruled. The
case will proceed under the Third and Fourth Defenses of
Respondent's Answers.
968
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Bernard D. Levinson
Administrative Law Judge
March 6, 1974
The complaints are entitled "Penalty Assessment and Notice of
Opportunity for Hearing."
21.D. No. 88486, May 16, 1973, SMCP Malathian ULV Concentrate
from Tampa to Tuscaloosa, Alabama. I.D. No. 88575, April 9, 1973,
Malathian ULV Concentrate Insecticide from Tampa to Gadsden,
Alabama.
The reference is to section 4 of FIFRA 1947, which required
registration of pesticides shipped in interstate commerce.
4 There are two other defenses in each answer. One denies certain
factual allegations in the complaint and the other attacks as
excessive the amount of penalty proposed to be assessed in each
instance. These two defenses are not here considered but will await
further proceedings.
5 It appears that this reference should be to section 4 of FIFRA 1947,
which requires registration. Section 4 of FIFRA 1972 deals with use of
restricted use pesticides and certified applicators which are not in
issue here.
6 "Section 4 of the bill sets forth various effective dates in order to put
the new program into operation as quickly and effectively as
possible." H.R. Rep. 92-511, 92d Cong., 1st Sess., 1971, p. 2.
7 Thus, if the pesticides in question at the time of alleged violations
were not registered under FIFRA 1947, they were not registered
under FIFRA 1972.
FIFRA 1972 added requirements relating to intrastate shipments of
pesticides.
969
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9 The Government brief (p. 24) stages that the civil penalty provision
of 14(a) has been utilized in some 228 cases.
10 The Government brief (p. 23) states that shortly after the statement
was issued, it developed a standard complaint form and regional
policy for seeking the imposition of civil penalties.
1480. In Re: H. G. Hasting Company, EPA Region IV, August 19,
1974. (I.F.&R. No. IV-83C, I.D. No. 117132.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
136j(a)(2)(A). The action pertained to a product held for distribution
or sale on April 18, 1974, at H. G. Hastings Company, Atlanta,
Georgia. The pesticide involved was SPECTRACIDE LAWN AND
GARDEN INSECT CONTROL; the charge was altering the labeling
required under the Act.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $500.00.
1481. In Re: Industrial Colloids & Chemicals, Inc., EPA Region
IV, August 19, 1974. (I.F.&R. No. IV-75C, I.D. Nos. 95669
and 95666.)
This was, a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
136j(a)(l)(E); 136(q)(l)(G); and 136(q)(l)(c){v). The action pertained to
products held for distribution or sale on November 29, 1973, at In-
dustrial Colloids & Chemicals, Inc., Knoxville, Tennessee. The
pesticides involved were HYPOCHLOR and INDUSTRIAL BRAND
PENTACHLOROPHENOL SOLUTION WOOD PRESERVATIVE;
the charge was misbranding—lack of adequate warning or caution
statements and lack of assigned registration number on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $2000.00.
970
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1482. In Re: Sonford Products Corporation, EPA Region IV,
August 19r 1974. (I.F.&R. No. IV-41C, I.D. No. 88597.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
136j(a)(l)(E) and 136(q)(l)(A). The action pertained to a product held
for distribution or sale on August 14, 1973, at Jackson, Mississippi.
The pesticide involved was PENTA CARE CONCENTRATE 1-10
WOOD PRESERVATIVE; the charge was misbranding—product
contained less active ingredients than represented in labeling.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $600.00.
1483. In Re: Tennessee Farmers Co-Operative, EPA Region IVr
August 20,1974. (I.F.&R. No. IV-3IC, I.D. No. 95579.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
136j(a)(l)(E); 136(c)(1); and 136(q)(l)(A). The action pertained to a
product held for distribution or sale on August 1, 1973, at Tennessee
Farmers Co-Operative, LaVergne, Tennessee. The pesticide involved
was CO-OP PASTURE BALANCER MEDICATED FOR
RUMINANTS ONLY; charges included misbranding and
adulteration—products strength or purity fell below the professed
standard of quality as expressed on its labeling.
Tni ?£spon'dent signed a Consent Agreement. The Final Order
assessed a civil penalty of $500.00.
1484. In Re: Chetnex Chemicals & Coatings Co., Inc., EPA
Region IV, August 23,1974. (I.F.&R. No. IV-61C, I.D. Nos.
88567,94875 and 94850.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
135a(a)(l); 135b; 136j(a)(l)(E); 136(q)(l)(G); 136(q)(2)(c)(iii); and
971
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136(q)(l)(F). The action pertained fo shipments made on March 26
and April 13 and 14, 1974, from Tampa, Florida, to Augusta and
Gainesville, Georgia. The pesticides involved were KAMO
INSECTICIDE 400, KAMO MINT DISINFECTANT-CLEANER-
SANITIZER-FUNGICIDE-DEODORANT and HELENA DYNE
GERMICIDAL SANITIZER; charges included nonregistration and
misbranding—lack of adequate warning statement, lack of net con-
tent statement, lack of adequate directions for use and lack of
adequate ingredient statement on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $3150.00.
1485. In Re: Woolfolk Chemical Works, Ltd., EPA Region IV,
August 30f 1974, (I.F.&R. No. IV-85C, I.D. No. 88443.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
136j(a)(l)(E) and 136(q)(1)(F). The action pertained to a shipment
made on January 30, 1973, from Fort Valley, Georgia, to Dothan,
Alabama. The pesticide involved was SECURITY ETHION EC-4; the
charge was misbranding—lack of adequate directions for use.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $3,000.00.
1486. In Re: Crosby Forest Products Company, EPA Region IV,
September 23,1974, (I.F.&R. No. IV-87C, I.D. No. 116801.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
136j(a)(l)(E); 136(q)(l)(G); 136(q)(l)(A); 136(c}(2); and 135(a)(l). The
action pertained to a shipment made on August 27, 1973, from
Picayune, Mississippi, to Doraville, Georgia. The pesticide involved
was VARTUNG PENTA WOOD PRESERVATIVE; charges included
composition differed from that accepted in connection with its re-
972
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gistration, adulterated and misbrqnded—product was chemically de-
ficient and lack of adequate warning or caution statement on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $ 1200.00.
1487. U.S. v. Industrial Water Chemicals Co., Inc., U.S. District
Court, Eastern District of Tennessee, Criminal No. 13050,
February 22,1973. (I.F.&R. No. 4-P-26,1.D. Nos. 96534 and
96535.)
This was a criminal action prepared by EPA Region IV charging the
defendant in an eight count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C 135a(a)(l);
135b(a); 135a(5); 135(z)(2)(d); 40 CFR 162.9, 1972 ed.; 135a(a)(5);
135(z)(2)(c); 135(z)(2)(e); and 135(o). The action pertained to
shipments made on March 2 and July 1, 1971, from Chattanooga,
Tennessee, to Inman, South Carolina. The pesticides involved were
BACTACIDE CV and ALGAECIDE; charges included nonregistration
and misbranding—lack of adequate warning or caution statement,
lack of adequate ingredient statement, and lack of adequate
directions for use on labels.
The defendant entered a plea of guilty to counts 1, 2, 5 and 6. The
remaining counts were dismissed.
A fine of $400.00 was levied.
1488. U.S. v. AG Manufacturing Company, U. S. District Court,
Middle District of Tennessee, Criminal No. 15,207, May 2,
1973. (I.F.&R. No. 4-P-36,1.D. Nos. 101736 and 101738.)
This was a criminal action prepared by EPA Region IV charging the
defendant in a four count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. 135a(a)(l);
135b; 135a(a)(5); 135(z){l); and 135(y). The action pertained to a
shipment made on January 26, 1972, from HopkinsviHe, Kentucky, to
973
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Nashville, Tennessee. The pesticides involved were TRIPLE ACTION
VEGETABLE DUST and AG BAX5WORM AND TENT CATER-
PILLAR SPRAY; charges included nonregistration, adulteration and
misbranding—labels bore a false or misleading registration number
implying that the product was registered and product was
contaminated with an additional active ingredient not declared in
labeling.
The defendant entered a plea of guilty to count 1. The remaining
counts were dismissed.
A fine of $50.00 was levied.
1489. U.S. v. AG Supply Company, Inc., U. S. District Court,
Middle District of Tennessee, Nashville Division, Criminal
No. 15,206, May 2, 1973. (I.F.&R. No. 4-P-47, I.D. No.
99940.)
This was a criminal action prepared by EPA Region IV charging the
defendant in a two count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. 135a(a)(5);
135(z)(l); and 135(y). The action pertained to a shipment made on
March 8, 1972, from Hopkinsville, Kentucky, to Nashville, Tennessee.
The pesticide involved was AG BAGWORM AND TENT
CATERPILLAR SPRAY; charges included adulteration and
misbranding—product was contaminated with an additional active
ingredient not declared in labeling and declared active ingredient
had been substituted wholly or in part with methyl parathibn.
The defendant entered a plea of guilty to count 1. The remaining
counts were dismissed.
A fine of $50.00 was levied.
1490. U.S. v. Cape Fear Chemicals, Inc., U. S. District Court,
Eastern District of North Carolina, Criminal No. 7276CR,
May 25,1973. (I.F.&R. No. 4-P-32, I.D. No. 96554.)
974
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This was a criminal action prepared by EPA Region IV charging the
defendant in a two count information with violating the Federal In-
secticide, Fungicide, and Rodenticide Act, 7 U.S.C. 135a(a)(l); 135b;
135a(a)(5); and 135(z)(l). The action pertained to a shipment made
on February 5, 1971, from Elizabethtown, North Carolina, to Dillon,
South Carolina. The pesticide involved was 1% PARATHION DUST;
charges included nonregistration and misbranding—labels bore a
false or misleading registration number implying that the product was
registered.
The defendant entered a plea of guilty.
A fine of $ 150.00 was levied.
1491. U.S. v. Carter & Company, U.S. District Court, Middle
District of Tennessee, Criminal No. 15237, May 29, 1973.
(I.F.&R. No. 4-P-53,1.D. No. 87840.)
This was a criminal action prepared by EPA Region IV charging the
defendant in a six count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act 7 U.S.C. 135a(a)(1);
135a(a)(5); 135(z)(2)(d); 135(z)(2)(c); 135[z)(2}(e); 135(o); 135(y); and
135(z)(l). The action pertained to a shipment made on September 23,
1971, from Nashville, Tennessee, to Danville, Kentucky. The pesticide
involved was PENTACHLOROPHENOL TERMITE CONTROL
PERSERVE ALL; charges included nonregistration, adulteration and
misbranding—strength or purity of product fell below the professed
standard of quality as expressed in labeling, lack of adequate in-
gredient statement, lack of adequate directions for use, and lack of
adequate warning or caution statement on labels.
The defendant entered a plea of guilty to count 1. The remaining
counts were dismissed.
The firm was given a 30 day suspended sentence with the provision
that the company would comply with the Act and register the
product.
975
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492. U.S. v. Rigo Chemical Company, U.S. District Court,
Middle District of Tennessee, Criminal No. 15236, June 14,
1973. (I.F.&R. No. 4-P-50,1.D. Nos. 79429, 79988, 67542,
100608,101502,100216 and 101503.)
This was a criminal action prepared by EPA Region IV charging the
defendant in a ten count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. 135a(a)(l) and
135a(a)(5). The action pertained to shipments made on February 9
and March 19, 1970; September 20, October 1, October 21 and
November 8, 1971, from Nashville, Tennessee, to Laurel, Mississippi;
Dumas, Arkansas; Abilene, Texas; Valdosta, Georgia; and Columbia,
South Carolina. The pesticides involved were KILL-KO VEGETABLE
DUST 5% SEVIN; KILL-KO CYTHION 5% DUST PREMIUM
GRADii MALATHION; KILL-KO NEW IMPROVED INSECT
BOMB WITH BAYGON; KILL-KO HOG LICE GRANULES; and
KILL-KO WASP BOMB; charges included nonregistration and
misbranding—bore a false or misleading registration number
implying that the product was registered and lack of adequate
directions for use on labeling.
The defendant entered a plea of nolo contendere to counts 4, 5, 7
and 9. The remaining counts were dismissed.
A fine of $3000.00 was levied. The entire fine was suspended with
the firm being placed on probation for one year.
1493. U.S. v. Chemical Packaging Corp., U.S. District Court,
Southern District of Florida, Criminal No. FL-73-CR-NCR,
October 3, 1973. (I.F.&R. No. 4-P-87,1.D. Nos. 85674 and
86683.)
This was a criminal action prepared by EPA Region IV charging the
defendant in a five count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. 135a(a)(5);
135(z)(2)(e); 135(z)(2)(d); and 135(z)(2)(c). The action pertained to
shipments made on July 12 and August 10, 1971, and June 12, 1972,
from Fort Lauderdale, Florida, to Meridian, Mississippi, and
976
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Cincinnati, Ohio. The pesticides involved were NEW-JAX WASP &
HORNET KILLER and CHEM-GLO CHEM-CAN INSECTICIDE; the
charge was misbranding—lack of adequate caution or warning state-
ment, lack of adequate ingredient statement and lack of adequate
directions for use on labeling.
The defendant entered a plea of nolo contendere to all counts.
A fine of $500.00 was levied.
1494. U.S. v. Harris Paint Company, U.S. District Court, Middle
District of Florida, Criminal No. 74-92-Cr-T-H, August 2,
1974. (I.F.&R. No. 4-P-71,1.D. No. 88215.)
This was a criminal action prepared by EPA Region IV charging the
defendant in a two count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. 135a(a)(l) and
135b. The action pertained to a shipment made on July 30, 1972,
from Tampa, Florida, to Winston Salem, North Carolina. The
pesticide involved was MIL-DU-MIX MILDEWCIDE; charges in-
cluded nonregistration and misbranding—labels bore a false or mis-
leading registration number implying that the product was registered.
The defendant entered a plea of guilty to count 1. Count 2 was
dismissed.
A fine of $300.00 was levied.
1495. U.S. v. Inco Chemical Supply Company, Inc., U.S. District
Court, Middle District of Florida, Criminal No. 142 Cr T-H,
August 29,1974. (I.F.&R. No. 4-P-80,1.D. No. 88002.)
This was a criminal action prepared by EPA Region IV charging the
defendant in a two count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. 135a(2)(l);
135b; and 135a(a)(2)(Q. The action pertained to a shipment made on
October 6,1972, from Tampa, Florida, to Birmingham, Alabama. The
977
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pesticide involved was INCO 415 PURE-O-PINE PINE OIL
CLEANSER DISINFECTANT DEODORANT; the charges included
nonregistration and misbranding—lack of statement of net weight on
labels.
The defendant entered a plea of guilty to count 1. Count 2 was
dismissed.
A fine of $500.00 was levied.
1496. U.S. v. Stauffer Chemical Company, Inc., U.S. District
Court, Middle District of Florida, Tampa Division, Criminal
No. 141 Cr. T-H, August 29,1974. (I.F.&R. No. 4-P-88,1.D.
No. 100516.)
This was a criminal action prepared by EPA Region IV charging the
defendant in a two count information with violating the Federal
Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C. 135a(a}(5);
135(z)(l}; 135a(a)(5); and 135(Y). The action pertained to a shipment
made on May 21, 1971, from Tampa, Florida, to Albany, Georgia.
The pesticide involved was USS SPOTNOT PEANUT DUST; charges
included adulteration and misbranding—product was contaminated
with an additional active ingredeint not declared in labeling.
The defendant entered a plea of guilty to count 1. Count 2 was
dismissed.
A fine of $500.00 was levied.
1497. In Re: Inter-State Nurseries, Inc., EPA Region VII, August
22, 1974. (I.F.&R. No. VII-42C, I.D. Nos. 115221 and
116887.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
135a(a)(l); 135b; 136j(a)(l)(E); 136{q)(l)(A); and 135(a)(l). The action
pertained to shipments made on May 1 and June 27, 1973, from
978
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Hamburg, Iowa, to Roseau, Minnesota, and Creedmoor, North
Carolina. The pesticide involved was INTER-STATE ROSE DUST;
charges included nonregistration and mlsbranding—labels bore a
false or misleading registration number implying that the product was
registered.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $1200.00.
1498. In Re: Contract Packaging, Inc., EPA Region VII,
September 11, 1974. (I.F.&R. No. VII-45C, UD. No.
105570.)
This was a civil action charging the respondent with violating the
Federal Insecticide, Fungicide, and Rodenticide Act, 7 U.S.C.
136j(a)(2)(E); 136(q)(l}(G); 136j(a)(l)(E); 136(q)(l)(F); 136(q){2){A);
136n; 136(q)(2)(C){iv); 136(q)(2)(C)(iii); and 136(q)(2)(C)(i). The action
pertained to a shipment made on July 10, 1973, from Norwalk, Iowa,
to Lenexa, Kansas. The pesticide involved was 4 WAY SCREW
WORM; the charge was misbranding—lack of adequate warning or
caution statement, lack of adequate directions for use, lack of
ingredient statement, lack of new weight statement and lack of
assigned registration number on labels.
The respondent signed a Consent Agreement. The Final Order
assessed a civil penalty of $400.00.
1499. In Re: Amvac Chemical Corporation, EPA Region IX, July
11,1974. (I.F.&R. No. IX-4C, I.D. Nos. 74864,74865,74869,
and 69221.)
This civil penalty proceeding was settled by hearing. The following is
Administrative law Judge Bernard D. Levinson's Initial Decision.
Preliminary Statement
979
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This is a proceeding under- section 14(a) of the Federal In-
secticide, Fungicide, and Rodenticide Act, as amended (FIFRA 1972),
7 U.S.C 136 l(a)1 for assessment of civil penalties for violations of
sections 12(aj(T)(A) and 12{a}(l)(E) of the Act (7 U.S.C. 136j{a){l)(A)
and (E)). The proceeding was initiated by complaint dated September
7, 1973, alleging violations relating to three pesticides. In substance,
the allegations are as follows:
1. Alco Nemagon Soil Fumigant Emulsible Concentrate
(Nemagon); shipments on March 22, 1973, and April 4, 1973, from
Los Angeles, California, to Phoenix, Arizona; product not registered
as required by 7 U.S.C. 135a{a)(l) and 135b 2 as continued in effect
by 'section 4(b) of Federal Environmental Pesticide Control Act of
1972.
2. Alco Systemic Fungicide (Fungicide); shipment from Los An-
geles to Phoenix on April 4, 1973; not registered as required. (Same
charge as in Nemagon). Also misbranded (section 12(a)(l)(E)) in that
the label did not bear the warning "Keep out of reach of children"
and the signal word "Caution" (section 2(q)(l)(G), 7 U.S.C.
3. Alco Copper Bordeaux 125 (Bordeaux); shipment from Ar-
tesia, California, to Phoenix on October 30, 1972; not registered as
required. (Same Charge as in Nemagon).
The civil penalties proposed to be assessed totaled $15,000
allocated as follows: nonregistration of Bordeaux $3,500; non-
registration of Nemagon and Fungicide $4,000 each; misbranding of
Fungicide $3,500. 3
The proceedings were conducted pursuant to the Interim Rules
of Practice governing hearings of this type, 38 F.R. 26360 et seq.
The respondent filed an answer and did not contest any of the
charges in the complaint relating to the violations and requested a
hearing oniy on the amount of the penalties proposed to be assessed.
980
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Pursuant to section 168.36(d) of the Rules of Practice, the Ad-
ministrative Law Judge corresponded with the parties for the purpose
of accomplishing some of the objectives of a prehearing conference.
The correspondence is in the record.4
A hearing in the case as to the appropriateness of the penalties
was held in Los Angeles, California, on May 23, 1974. The
complainant was represented by Matthew S. Walker, Esq. and James
L. Jaffe, Esq. of the legal staff of EPA, Region IX and respondent was
represented by Gerald Levie, Esq., of the law firm of Levie & Burkow,
Los Angeles.
Proposed findings and briefs were filed by the parties and have
been duly considered by the Administrative Law Judge. After
considering the entire record, the Administrative Law Judge makes
the following
Findings of Fact
1. The respondent, Amvac Chemical Corporation, with a place
of business in Los Angeles, California, is a wholly-owned subsidiary of
American Vanguard Corporation which has principal executive
offices in Burbank, California.
2. The corporate historical background of Amvac Chemical is as
follows: Durham Chemical Company, a California Corporation which
had been in business since 1946, was a manufacturer of pesticides.
Glenn Wintemute owned all the shares of stock of Durham. In
October 1970 Durham acquired all the shares of Alco Chemical Com-
pany, a California corporation located in Artesia, California, which
had been in the pesticide manufacturing business since 1956. In
October 1971 American Vanguard acquired all the shares of
Durham. In December 1972 Alco was merged with Durham and
simultaneously the name of the Corporation that resulted was
changed to Amvac Chemical Corporation. Mr. Wintemute is president
of Amvac Chemical and a director and stockholder in American
Vanguard.
981
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3. The respondent manufactures and distributes pesticides.
Distribution is in California and interstate. Approximately 200 of its
products are registered or pending registration under federal law and
with state boards. The three products in question were manufactured
or distributed by Alco at the time Alco was taken over by Durham.
The respondent continued to distribute them using Alco in the name of
the products.
4. On March 22, 1973, and April 4, 1973, the respondent
shipped from Los Angeles, California, to Phoenix, Arizona, quantities
of the pesticide called Alco Nemagon Soil Fumigant Emulsible
Concentrate. Said pesticide was not registered as required by the
Federal Insecticide, Fungicide, and Rodenticide Act, as amended.
5. On April 4, 1973, the respondent shipped from Los Angeles,
California, to Phoenix, Arizona, quantities of the pesticide called
Alco Systemic Fungicide. Said pesticide was not registered as re-
quired by the Federal Insecticide, Fungicide, and Rodenticide act, as
amended.
6. The pesticide referred to in the previous finding was mis-
branded in that the label did not bear on the front panel or on the
part of the label displayed under customary conditions of purchase
the signal word "Caution" and the warning statement "Keep out of
reach of children."
7. On October 30, 1972, the respondent shipped from Artesia,
California, to Phoenix, Arizona, quantities of the pesticide called
Alco Copper Bordeaux 125. Said pesticide was not registered as
required by the Federal Insecticide, Fungicide, and Rodenticide Act,
as amended.
8. The respondent has approximately 65 employees. Its net
sales in 1973 were approximately $5,150,000 and its business has
been increasing. The imposition of the penalties hearinafter assessed
will not effect respondent's ability to continue in business.
Conclusion
982
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The respondent violated section 12(a)(l)(A) of the Federal In-
secticide, Fungicide, and Rodenticide Act, as amended, by shipping
in interstate commerce three pesticides, namely, Alco Nemagon Soil
Fumigant Emulsible Concentrate, Alco Systemic Fungicide, and Alco
Copper Bordeaux 125, which were not registered as required by 7 U.
S. C. 135(b), as continued in effect by section 4(b) of Federal
Environmental Pesticide Control Act of 1972.
In the shipment of Alco Systemic Fungicide, the respondent also
violated section 12(a)(1)(E) of FIFRA, as amended, in that the pesti-
cide was misbranded because its label did not bear warning and
caution statements that were required.
Having considered the size of the respondent's business, the
effect on respondent's ability to continue in business, and the gravity
of the violations, it is determined that the following penalties are
appropriate:
Non-registration Alco Nemagon Soil Fumigant — $4,000
Non-registration Alco Systemic Fungicide — $2,500
Non-registration Alco Copper Bordeaux 125 - $2,500
Misbranded Alco Systemic Fungicide — $2,500
Since respondent did not contest the charges, the sole purpose
of the hearing was to determine the amount of penalties that should
be assessed.
Section 14(a) of FIFRA, as amended (the provision authorizing
imposition of civil penalties) was a new provision in the T972
amendments and became effective on enactment on October 21,
1972. Section 14(a)(3) (7 U.S.C. 1361^ (a)(3)) provides in pertinent
part:
In determining the amount of the penalty the
Administrator shall consider the appropriateness of such
penalty to the size of the business of the person charged,
983
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the effect on the person's ability to continue in business,
and the gravity of the violation.
It is apparent that Congress intended that the penalty should fit
the offender as well as the offense.
The assessment of civil penalties is a decentralized operation of
EPA and is handled in the ten regional offices throughout the country.
When a complaint charging violations is issued, the amount of pe-
nalties proposed to be assessed is set forth. The Rules of Practice
encourage settlement (section 168.35(a)) and if the case is not settled
the respondent may request a hearing. Where, as in this case, the
charges are not contested the Administrative Law Judge must make
an independent judgment as to the appropriateness of the penalty to
be assessed.
The first factor that the statute requires to be considered in
determining the amount of the penalty is the size of respondent's
business. This respondent is a subsidiary of American Vanguard
Corporation, a company that does not engage in any independent
business activities on its own behalf, but is merely a holding company
for seven subsidiaries.
The record includes certain financial reports, prepared by a well
known firm of certified public accountants, and submitted by
American Vanguard Corporation to the Securities and Exchange
Commission on March 29, 1974. These are consolidated reports of
American Vanguard and its subsidiaries, including the respondent.
The total net sales of all companies for the year 1973 is shown as
$13,911,500. The report shows that 37%, which is approximately
$5,150,000 was derived from manufacturing and distribution of
pesticides, other agricultural chemicals and fertilizers. 5 Mr.
Wintemute, president of respondent, testified that the gross sales of
respondent for 1973 were about $5,200,000 and attributed the 37%
figure of total gross sales to respondent. * Thirty-five to fourty percent
of respondent's business is the interstate shipment of pesticides. The
respondent has approximately 200 of its products registered or
pending registration under federal or state laws. Considering each
984
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package size in which a pesticide is distributed as a separate
product, it handles more than a thousand pesticides.
With respect to respondent and certain of the other subsidiaries,
the report states that they continue to show encouraging earnings
and management is anticipating continued growth in these areas. In
January 1973 the respondent had 40 employees; its business in-
creased thereafter and at the time of the hearing it had 65
employees.
Without attempting to characterize the size of respondent's
business as large or small (which are only relative terms) the fact
remains that its sales in 1973 were over 5 million dollars, and this, by
any measure, must be regarded as very substantial.
As to respondent's ability to continue in business (the second fa-
ctor to be considered in determing the appropriateness of the
penalty) we first look to the reports filed with SEC. The consolidated
balance sheets for 1973 show assets and liabilities of $5,565,500.
The stockholders equity is shown as $1,365,500, including retained
earnings of $114,300. The consolidated net earnings for the year
were $5,500 which is included in the retained earnings. Cash in the
amount of $33,200 is shown as of December 31,1973.
According to the testimony of the respondent's president, the
assessment of civil penalties up to $15,000 (the amount proposed in
the complaint) for the violations in question would not affect
respondent's ability to continue in business.
It may well be that payment of the penalties herein assessed will
adversely affect respondent's cash flow and inconvenience it
temporarily but we are unable to find that it will effect its ability to
continue in business.
The respondent has proposed a finding to the effect that the
total annual volume of all of the products, the sale and distribution of
which resulted in violations, were less than $5,000 for the year 1973.
We have been unable to find the evidence in the record to support
this finding. In any event, it is not the volume of sale of individual
985
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products that is to be used as the measuring stick, but rather it is the
size of respondent's business.
The third factor to be considered in determining the amount of
the penalty is the gravity of the violation. Aside from the general
purposes of the Act there is nothing therin that would assist in in-
terpreting what Congress intended in the term "gravity of the vio-
lation." 7 So far as we can determine there is nothing in the legislative
history to shed light on this subject.
We are of the view that the same basic principles by which
courts are guided in imposing sanctions in criminal cases are
applicable in assessing civil penalties in cases of this type.
In determining the punishment to be imposed, within the
limits prescribed by the statute, the court may and should
weigh and consider all pertinent matters, including
mitigating or aggravating circumstances .... The court
should give due regard to the nature of the offense and
the attending circumstances and it should impose such
punishment as tends to prevent a repetition of crime.
However, justice generally requires consideration of more
than the particular act by which the crime was committed,
and that there be taken into account the circumstances of
the offense together with the character and propensities
of the offender
24BCJ.S. section 1980b. See also Commonwealth of Pennsylvania
y. Ashe, 302 U.S. 51 (1937). ~'
It is our view that in considering appropriateness of the penalty
to the "gravity of the violation" the evaluation should be made from
two aspects -— gravity of harm and gravity of misconduct. As to
gravity of harm there should be considered the actual or potential
harm or damage, including severity, that resulted or could result from
the particular violation. This must be viewed in the light of the
purposes of the Act which includes protecting the public health and
environment and affording to users the protection and benfits of the
Act. Further, the Act provides enforcement officials with the means
986
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for preventing the marketing of violative products and also the means
for obtaining speedy remedial actton when necessary.
As illustrative of the degrees of gravity of harm, it is apparent
that a violation involving the marketing of a highly toxic pesticide
that is not registered is much more serious than a violation in which
the label of a registered pesticide fails to bear the registration
number.
As to gravity of misconduct, matters which may be properly
considered include such elements as intention 8 and attitude of re-
spondent; knowledge of statutory and regulatory requirements;
whether there was negligence and if so the degree thereof; position
and degree of responsibility of those who performed the offending
acts; mitigating and aggravating circumstances; history of
compliance with the Act; and good faith or lack thereof. It is observed
that the Rules of Practice specify these last two elements as those that
may be considered in evaluating the penalty (section 168.53(b)).
In grading the gravity of the various violations enumerated in
the Act, shipment of an unregistered pesticide may be considered to
be a serious violation. It is obvious that when an unregistered
pesticide is distributed the protective and enforcement purposes of
registration are defeated.
In the present case the only evidence from complainant as to
potential harm or damage relates to the Nemagon product. It is
indicated that this product is of a relatively high degree of toxicity
"clrid'also that it may have corrosive action on equipment with which it
is applied. * The respondent merely states that the material itself is
not in question and that the products were properly registered in
California.10
As to the misbranding charge of the fungicide product, the only
portion of the record touching on harm or damage is a paragraph in
complainant's letter of December 21, 1973. n The potential harm that
is mentioned is generally applicable to most, if not all, pesticides and
the regulation requires warning and caution statements on every
pesticide (40 CFR 162.9). While failure of the label to bear these
987
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statements may be considered as a serious violation, no particular or
unusual hazard has been demonstrated with regard to this product.
As to the gravity of misconduct in this case there are both mi-
tigating and aggravating factors. The pesticides in question were
registered in California, 12 at the time and could properly have been
shipped within the state. The violations took place at a time when
there were some disruptions in respondent's operations due to
changing of location of operations from one city to two locations (one
for offices and production and the other for warehousing) in another
city.
As a mitigating factor, the respondent urges that a key em-
ployee who had supervised registration activities for 10 years (first
with Alco and subsequently with Durham and respondent) left the
company in September 1972 having had a leg amputated and that
prior thereto he had taken considerable time off because of impaired
health. It is to be noted that after the key employee left, another
employee, who also had other duties, took over the registration
responsibilities. It was not until May 1973 that respondent hired an
employee to handle the registration and related matters on a full time
basis. This hiring was subsequent to the violations in question and
after the citation for another violation was issued. This latter violation
resulted in a criminal prosecution Having in -mind the magnitude of
respondent's annual sales, the delay in obtaining adequate help for
these purposes must be considered as a negative factor. The
president of respondent has had considerable experience in the dis-
tribution of pesticides and at least as early as 1963 knew that
pesticides had to be registered.
Also on the negative side, we have the criminal prosecution
above mentioned. The respondent shipped an unregistered pesticide
and was prosecuted criminally. It pleaded nolo-contendere and on
August 13, 1973, was fined $500 of which $250 was suspended and
it was placed on probation for one year.13
In addition, EPA sent two warning letters to respondent in May
and June 1973 in which minor violations were brought to its
attention.
988
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As part of the history of non-compliance with the Act, the com-
plainant set forth seven violations between November 1967 and
September 1968. These were violations by Alco Chemical Company
prior to the time it was taken over by Durham (see Finding 2). fn the
circumstances of this case, we consider these violations to be too re-
mote from respondent's operations and find that it is inappropriate to
charge this history of non-compliance to this respondent. For the
purposes of this case these violations have been disregarded.
The violations in question resulted from negligence of
respondent. We consider the non-registration charge of the fungicide
product and Bordeaux to be of a moderate degree of gravity and
have assessed penalties of $2,500 on each of these charges. The
evidence shows that the potential harm from use and distribution of
Nemagon is of a relatively high degree and we have assessed a civil
penalty of $4,000 for this non-registration violation. We consider the
misbranding charge of the fungicide product to be of a moderate de-
gree and have assessed a penalty of $2,500 for this violation.
The proposed Findings of Fact and Conclusions submitted by the
parties have been considered. To the extent that they are consistent
with Findings of Fact and Conclusions herein, they are granted,
otherwise they are denied.
Having considered the entire record and based on the Findings
of Fact and Conclusions herein, it is proposed that the following order
be issued.
Final Order
Pursuant to section 14{a){l) of the Federal Insecticide, Fungi-
cide, and Rodenticide Act, as amended (7 U.S.C. 136Jja)(l)), civil pe-
nalties totalling $11,500 are assessed against respondent Amvac
Chemical Corporation, Los Angeles, California, for violations of said
Act which have been established on the basis of complaint issued on
September 7, 1973.
989
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Bernard D. Levinson
Administrative Law Judge
July 11,1974
'The Federal Insecticide, Fungicide, and Rodenticide Act, as it existed
prior to the 1972 amendments (FIFRA 1947), was amended by the
Federal Environmental Pesticide Control Act of 1972 (FEPCA), P.L
92-516. FIFRA 1972 has been codified in 7 U.S.C. 136 et seq.
2These references are to FIFRA 1947. The registration provisions and
regulations thereunder of FIFRA 1947 remain in effect until
superseded by new registration regulations which are required to be
promulgated by October 21, 1974. See section 4(b) and 4(c)(l) of
FEPCA. New registration regulations have not yet been promulgated.
*This allocation is in a letter from complainant's attorney dated
December 21,1973.
*The letter mentioned in footnote 3 is part of the correspondence.
'Complainant's brief claims net sales of respondent for 1973 were
approximately $5,572,000 and respondent's brief gives this figure as
$3,287,800. No explanation is given for either of these figures.
"Total net sales for 1972 were $11,683,800 of which 33%
($3,855,654) was from pesticides, etc.
'"Gravity" is defined in Webster's Third New International
Dictionary to include "importance, significance, dignity, especially
seriousness (the gravity of the offense).
'Although intent is not an element of an offense in a civil penalty
assessment case (cf. U.S. v. Dotterweich, 320 U.S. 277), intent to
violate may be an aggravating factor.
'This is in complainant's letter of December 21, 1973, in which it is
stated that this product "which contains 70% active ingredients (not
identified) is corrosive to aluminum and may therefore affect the
990
-------
equipment with which it is applied. The estimated fatal dose of this
active ingredient according to the Handbook of Poisoning, is 2 grams
at 100% strength. Since there are 28 grams per ounce, 2 grams is a
rather small quantity." By letter of December 24, 1973, respondent
answered the letter of December 21 but raised no question on these
points. No evidence was introduced at the hearing on these subjects.
"Respondent's letter of December 11,1973.
"The paragraph is as follows:
As to the misbranding violation against the Alco Systemic Fungicide,
the lack of a warning statement such as "Keep out of the reach of
children" and the absence of a signal word, such as "Caution", is
considered a serious violation. Most pesticides are dangerous
products, and in order to protect the public it is necessary that they
have adequate warnings on the labels. Warning statements are one
of the more important notations on a pesticide label in that they alert
the user to be careful. But where there are no warnings on the label,
there is no reminder to be cautious. For these reasons, we consider the
misbranding violation serious enough to warrant a substantial
penalty.
"Respondent's brief claims that they were also registered in Arizona.
We find nothing in the record to support this claim.
13The evidence at the hearing was that the violation occurred on
Ma,rch 16, 1973. Complainant's brief states that a review of the file
discloses that the violation occurred on March 21, 1972, and a
citation was mailed on March 16, 1973. Irrespective of the date of
violation, the fact remains that there was a violation which was
disposed of as stated.
1500. In Re: Beaulieu Chemical Company, EPA Region IX, July
24,1974. (I.F.&R. No. IX-IOC, I.D. No. 104087.)
This civil penalty proceeding was settled by hearing. The following is
Administrative Law Judge Bernard D. Levinson's Initial Decision.
991
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Preliminary Statement
This is a proceeding under section 14(a) of the Federal In-
secticide, Fungicide, and Rodenticide Act, as amended (FIFRA 1972),
7 U.S.C. 136_l(a),1 for assessment of a civil penalty for violations of
sections 12(aTl)(C) and 12(A)(1)(E) of the Act (7 U.S.C. 136j(a)(l)(C)
and (E)). The proceeding is based on an amended complaint filed on
February 13, 1974,2 relating to the pesticide Beaulieu Udder-Dyne
Sanitizing Udder Wash (Udder-Dyne) which was shipped from Stock-
ton, California, to Manhattan, Montana, on November 12, 1972. In
substance it is alleged that section 12(a)(l)(C) was violated in that the
composition of the product differed from the composition as pre-
sented in connection with its registration (7 U.S.C. 135a(a)(l)}.3 It is
also alleged that the product was misbranded in violation of section
12(a)(l)(E) in that the label of the product was different from the label
submitted and approved in connection with the registration of the
product. The complaint proposed to assess a civil penalty in the
amount of $4,000.
The respondent * filed an answer and requested a hearing. In the
answer to the amended complaint the respondent in effect denied the
allegations of the complaint and denied that violations had occurred.
By way of affirmative defense respondent alleged certain factual
matters which are considered later in the decision. The respondent
challenged the appropriateness of the proposed penalty.
The proceedings were conducted pursuant to the Interim Rules
of Practice governing hearing of this type, 38 F.R. 26360, et seq.
Pursuant to section 168.36(d) of said Rules the Administrative Law
Judge corresponded with the parties for the purpose of
accomplishing some of the objectives of a prehearing conference. The
correspondence is in the record.
A prehearing conference in this case was held in Stockton, Cali-
fornia, on May 21, 1974, immediately followed by a hearing. The
complainant was represented by Messrs. Matthew S. Walker and
James L Jaffe of the legal staff of EPA, Region IX and respondent
was represented by Ms. Carol Atkinson of the law firm of Chargin &
Briscoe of Stockton.
992
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The respondent did not contest the interstate shipment of the
product in question or the fact that a sample of the product was taken
from one of the containers of the shipment.
Proposed findings and briefs were filed by the parties and have
been duly considered by the Administrative Law Judge. After
considering the entire record the Administrative Law Judge makes the
following
Findings of Fact
1. The respondent Beaulieu Chemical Company, located in
Stockton, California, is a sole proprietorship, wholly owned by John L.
Beaulieu. The company has been in business since 1965. The
company purchases and distributes chemical products and it also
compounds chemicals into products which it distributes in California
and interstate. Among the products that respondent distributes are
pesticides as defined in Federal Insecticide, Fungicide, and
Rodenticide Act, as amended (FIFRA).
2. The respondent compounds and distributes a product called
Beaulieu Udder-Dyne which is a pesticide within the meaning of
FIFRA.
3. Udder-Dyne has been registered under federal law as a pesti-
cide (formerly called economic poison) since June 29, 1967, under
registration number 9584-5. The Confidential Statement of Formula
submitted by respondent in connection with the application for
registration showed the formula as nonylphenol polyethylene glycol,
15.50%; phosphoric acid, 11.50%; inert ingredients, 73%. The
label which was approved showed ingredients as follows:
nonylphenoxy polyethylene glycol-iodine complex (provides 1.75%
titratable iodine) 15.50%; inert ingredients 84.50%.
4. On November 12, 1972, the respondent shipped from Stock-
ton, California, to Manhattan, Montana, 30 gallons of Udder-Dyne in
cartons each containing six one-gallon plastic containers. On
February 6, 1973, a Consumer Safety Officer of Environmental
Protection Agency (formerly designated Inspector) took from the
993
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consignee, as a sample, a one-gallon container of the product that
was so shipped.
5. The label of the container that was taken as a sample re-
presented that it was registered under EPA Reg. No. 9584-5 and re-
presented the product to contain 13.00% nonylphenoxypoly
(ethylenexy) ethanol-iodine complex (providing 1.75% titratable
iodine); 8.25% phosphoric acid; and 78.75% inert ingredients. The
product was so labeled when it was shipped from respondent's
premises.
6. Chemical analyses of portions of the sample showed that the
product contained 2.14% titratable iodine and 7.85% phosphoric
acid.
Conclusions
The respondent violated section 12(a)(l)(C) of the Federal In-
secticide, Fungicide, and Rodenticide Act, as amended, in that it
distributed and shipped from Stockton, California, to Manhattan,
Montana, a pesticide the composition of which differed at the time of
distribution from its composition as described in a statement required
and which it submitted in connection with the registration of the
product. The respondent also violated section 12(a)(l)(E) of said Act
in that the pesticide so distributed and shipped was misbranded in
that the label was false and misleading since the product represented
to be a registered pesticide and the representation as to Ingredients
on the label were different from those that were approved at the time
of registration.
Having considered the size of respondent's business, the effect
on respondent's ability to continue in business, and the gravity of the
violations, it is determined that a penalty of $1,500 is appropriate for
said violations.
John L Beaulieu, the sole owner of Beaulieu Chemical
Company, manages the company. His wife is in charge of the office.
In addition, the company has nine employees — six are in the plant,
one is the foreman and the others are laborers. Neither Mr. Beaulieu
994
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nor any of the employees have had any formal training in chemistry or
the sciences. In 1972 the gross sales of the company were
approximately $452,000 and net income was $21,000. In 1973 the
gross sales were $526,000 and net income was $31,000.
The company distributes its products in California and
interstate. It has approximately 30 pesticides registered in California
and sorrfe 10 or 15 registered under federal law. s Approximately
15% of its sales are interstate. The product in question, Udder-Dyne,
is a pesticide since its recommended uses include use as a germicide
on equipment or utensils used in milking cows. Interstate shipments of
Udder-Dyne represents a small percentage of respondent's total
sales.
The respondent does not employ a chemist and no chemical tests
are made on the ingredients that go into his products or on the
finished products. The products are prepared by weight of
ingredients by Mr. Beaulieu or one of the employees. Finished
products containing iodine are tested with the use of a "test kit".
Small pieces of specially treated paper are dipped into a sample of
the finished product to give a reading of parts per million of iodine.
No other control procedures are used by respondent.
On June 29, 1967, the respondent's registration for Udder-
Dyne was approved by the U.S. Department of Agriculture, the pre-
decessor of EPA,6 and this registration under number 9584-5 is still in
effect. The product when diluted was to be used as a germicide on the
udders of cows in milking and also on milking utensils. The
confidential formula that respondent submitted in connection with
this registration showed the product contained 15.50%
nonylphenoxy polyethylene glycol-iodine complex; 11.50%
phosphoric acid; 73 % inert ingredients. The label that was approved
in connection with the registration listed the iodine complex at
15.50% (provides 1.75% titratable iodine) and inert ingredients at
84.50%.7 The label directed that a solution be made using one ounce
of product to 5 gallons of water which would provide 25 ppm
available iodine.
995
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For all years from 1968 through 1974 (except 1972) the re-
spondent has had registered with the Department of Food and Agri-
culture of the State of California a product called Udder-Dyne to be
used for the same purposes as the federally approved product. The
approved formula for the California registered product contains
11.30% of the iodine complex; 3.68% phosphoric acid; and
85.02% inert ingredients. The dilution directed is one ounce to 3
gallons of water which would also provide 25 ppm available iodine.
It appears from the evidence that in both products the iodine
complex ingredient provides the germicidal properties.
In September 1972, the respondent applied to EPA to have the
registration of Udder-Dyne changed to a formulation of 11.30%
iodine complex and 3.68% phosphoric acid. The proposed formula
was never approved and registration for such a product was never
issued.
Also in 1972 the respondent was considering changing the re-
gistration of Udder-Dyne with the State of California to a formulation
with 13% iodine complex. However, an application for this purpose
was not filed.
Although respondent did not have registration for Udder-Dyne
approved, either in California or with EPA, with a formulation of 13 %
iodine complex and 8.25% phosphoric acid, it had one-gallon plastic
containers imprinted with a label (by the silk screen process) showing
these percentages of active ingredients. Further, such label also bore
the statement "EPA Reg. No. 9564-5."
On November 12, 1972, the respondent shipped from its plant
in Stockton, California to Churchill Equipment Co., Manhattan,
Montana, five cartons each containing six one-gallon containers of
Udder-Dyne. The containers were those described in the preceding
paragraph. Mr. Beaulieu testified that he had paper overlay labels of
ingredients printed for interstate shipments of this product which
were to be superimposed over the imprinted statement of ingredients
and that the overlay labels gave the ingredients according to the
federally approved label.
996
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One of the containers was taken as a sample from an unopened
carton by an EPA inspector from Churchill Equipment on February 6,
1973. The carton taken as a sample did not have the overlay label
and it bore the original imprint (13% iodine complex, 8.25%
phosphoric acid).
Mr. Beaulieu testified that he instructed one of his employees to
place the overlay label on the gallon containers before they were
filled and that he was sure in his own mind that the overlay labels
were on this particular shipment. He assumed that his instructions
were carried out but he could not say for sure, and further he could
not say that he saw these particular containers before they were
shipped. He further testified that they were having a problem with
paper labels sticking to plastic containers.
There was no direct evidence that the overlay labels were
placed on the containers that were shipped on November 12, 1972.
Such evidence could properly have come from the employee who was
supposed to have affixed them to the containers. The respondent did
not produce this employee as a witness or attempt to explain her
absence.
Mr. Beaulieu also testified that he called the customer in
Montana who had received this and other shipments of Udder-Dyne
and asked him to check his stock of the product to see if the overlay
labels were affixed to the containers. The customer reported that all
containers had the overlay labels and he could not recall one instance
where the overlay label became detached. Accepting this testimony
as true it would indicate that the overlay labels adhered firmly to the
containers.
On consideration of all the evidence on this subject, we
conclude that at the time of shipment there was no overlay label af-
fixed to the container that was taken as a sample on February 6,
1973.
Portions of the contents of the gallon container taken as a
sample on February 6, 1973, were analyzed by qualified chemists in
the Regional Office of EPA in San Francisco.
997
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These analyses showed that the product contained 2.14% titratable
iodine and 7.85% phosphoric acid.8 The product was over-formulat-
ed for titratable iodine by approximately 22% and under-formulated
for phosphoric acid by approximately 32 %.
The provision authorizing civil penalties (section 14(a)) was a
new provision that became effective with the 1972 amendments to
FIFRA. Section 14{a)(3) (7 U.S.C 136JJa)(3) provides in pertinent
part:
In determining the amount of the penalty the
Administrator shall consider the appropriateness of such
penalty to the size of the business of the person charged,
the effect on the person's ability to continue in business,
and the gravity of the violation.
It is apparent that Congress intended that the penalty should fit
the offender as well as the offense.
Section 168.53{b) of the Rules of Practice provides that in
evaulating the appropriateness of the penalty, in addition to the
above three factors, the following factors may also be considered: (1)
respondent's history of compliance with the Act, and (2) any evidence
of good faith.
We recently expressed our views in another case under section
14(a) that in considering appropriateness of the penalty to the
"gravity of the violation" the evaluation should be made from two
aspects — gravity of harm and gravity of misconduct. We said:
As to gravity of harm there should be considered the
actual or potential harm or damage, including severity
that resulted or could result from the particular violation.
This must be viewed in the light of the purposes of the Act
which includes protecting the public health and en-
vironment and affording to users the protection and
benefits of the Act. Further, the Act provides enforcement
officials with the means for preventing the marketing of
998
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violative products and also the means for obtaining
speedy remedial action when necessary.
* * *
As to gravity of misconduct, matters which may be
properly considered include such elements as intention '
and attitude of respondent; knowledge of statutory and
regulatory requirements; whether there was negligence a
and if so the degree thereof; position and degree-of
responsibility of those who performed the offending acts;
mitigating and aggravating circumstances; history of
compliance with the Act; and good faith or lack thereof.
It is observed that the Rules of Practice specify these last
two elements as those that may be considered in
evaluating the penalty (section 168.53(b)).
In considering the gravity of harm, we look to the under-formu-
lation of phosphoric acid and over-formulation of the iodine complex;
It is to be noted that the Udder-Dyne registered in California
was approved with a phosphoric acid content of 3.68%. The product
in question should haye had 11.50% phosphoric acid but had only
7.85%. While the deficiency is substantial and shows inadequate
quality control, we cannot find that there is any serious potential
harm or inefficacy of the product by reason of this deficiency.
As to the over-formulation of the iodine complex, there was no
evidence to show what harm, if any, might result therefrom. Were we
permitted to do so we might conjecture that the use of this product
with the excess of iodine complex might have some adverse effect in
the purposes for which it was to be used. However, there is no
evidence in this regard and lacking such evidence we assess a degree
of gravity of harm of a relatively low order.
On the matter of gravity of misconduct we first look at the
respondent's history of non-compliance with the Act. The complainant
offered no evidence of prior convictions or imposition of civil
penalties. The complainant offered in evidence a number of citations
999
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and warning letters '° and documents relating thereto that had been
issued to respondent relating to alleged violations of the Act. " We
ruled that citations or warning letters to which respondent did not re-
spond or with respect to which it did not deny the allegations would
be admitted into evidence to show history of non-compliance, but
that citations or warning letters in which respondent contested the
alleged violations would not be admitted. Under this ruling, 15
citations for alleged violations that occurred from May 1967 through
December 1972 and four warning letters for alleged violations from
September 1970 through January 1973 were received into evidence.
They were admitted over respondent's objection.
We are of the view that the same basic principles by which
courts are guided in imposing sanctions in criminal cases are appli-
cable in assessing civil penalties in cases of this type. It is well
established that in imposing punishment in a criminal case the court
may take into account the defendant's past record. Pennsylvania v.
Ashe, 302 U.S. 51 (1937); Costner v. U.S., 271 F.2d 261 (6th Or.
1959); Olson v. U.S., 234 F.2d 956 (4th Cir. 1956); 14B C.J.S.
Criminal Law, section 1980b. Further, the Supreme Court has held
that under Habitual Criminal Act, prior convictions may be considered
even though one of the convictions that entered into the calculations
occurred before the Act was passed. Gryger v. Burke, 334 U.S. 728
(1948).
The violations alleged in the citations and warning letters were
violations of FIFRA which is the same Act under which respondent is
charged in this proceeding. FEPCA 1972 amended FIFRA 1947 but
did not repeal it. It is true that there were extensive amendments in
1972 but it is nevertheless the same Act.
As to those citations or warning letters in which respondent ad-
mitted the violations they were clearly extra-judicial admissions. The
citations and warning letters to which it did not respond were
admitted on the principle that "silence or acquiescence of a party
may be shown where the facts stated tend to expose him to the
consequences of a criminal act." 31A C.J.S., Evidence 295. In
Megarry Brothers, Inc. v. U.S., 404 F.2d 479, 488 (8th Cir. 1968) the
1000
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court quoted with approval the following language from McCormick,
Evidence Sec. 247 (1954)
Failure to reply to a letter containing statements which it
would be natural under all circumstances for the
addressee to deny if he believed them untrue, is
receivable as evidence as an admission by silence.
See also Wiilard Helburn v. Spiewak, 180 F.2d 480, 482 (2nd
Gr. 1950); 31A C.J.S., Evidence, Sec. 297.
Summarizing the allegations in the citations, we find charges
relating to nine different products: four of the charges were non-
registration of the product; three were deficient active ingredients;
three were non-registration for the particular distributor; considering
the same charge against the same product as a single charge, there
were four charges for absence of warnings and caution " and three
for failure to bear registration number; " there was one charge for
failure to bear statement of weight or measure of contents. In the
warning letters two of the charges were for non-registration for the
named distributor and the other charges were for minor label
deficiencies.
There was also received into evidence over respondent's
objections documents and results of analyses relating to four products
of which samples were taken by an EPA inspector during an in-
spection of respondent's plant on April 4, 1974. These were offered
to show continuing violations by respondent and lack of good faith.
Mr. Beaulieu testified in substance that the company does not
have stock on hand for products that are to be shipped outside of
California and that such products are compounded in response to
specific orders and that the products from which samples were taken
were not intended for interstate shipment. However, records of
interstate shipments of these products were examined by the EPA in-
spector and Mr. Beaulieu signed a statement to the effect that such
products from which samples were taken had been shipped in
interstate commerce. Further, the samples of the products were taken
from stock on hand and the label of each product bore an EPA
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registration number. We find that products from which the samples
were taken were being held for sale for interstate shipment.
Two of the products were deficient in active ingredients and one
had an excess of active ingredients. The labels of three of the
products were not in accordance with the labels as accepted at time
of registration.
At the hearing on May 21, 1974, Mr. Beaulieu stated that he
had sent samples of the four products to an independent chemical
laboratory for analysis about a week previously and that the results
were expected in about a week. We granted respondent 10 days
within which to submit results of these analyses. The respondent
submitted a copy of letter from a laboratory dated June 20, 1974,
showing results of analyses of four named products which the
laboratory received on June 18, 1974. Although the names of the
products were the same as those taken during the plant inspection
there is no proof that they were from the same batch as the samples
that were taken on April 4. Further, it is obvious that the samples
tested were not the ones that Mr. Beaulieu said he sent to the
laboratory around the middle of May. The complainant offered to
furnish respondent with portions of the samples taken on April 4 but it
appears that respondent did not accept the offer. We do not consider
the letter from the laboratory as reliable evidence for the purpose of
establishing the chemical content of the products of which samples
were taken on April 4.
Mr. Beaulieu has been operating the respondent company since
1965. Prior thereto he was the owner of another chemical company.
In May 1968, in response to a citation that was issued the previous
month, Mr. Beaulieu acknowledged that he was fully aware of the
regulations under FIFRA. Notwithstanding, the respondent continued
to violate the provisions of the Act. We have not overlooked the fact
that none of the violations for which the citations were issued were
considered serious enough to warrant the institution of criminal
proceedings.
The violations in question, from a harm point of view, were not
shown to be of a high degree of gravity. However, respondent's
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operations over the years demonstrate carelessness, negligence, in-
adequate controls, and disregard for requirements of the Act. While
it may be true that respondent corrected most of the deficiences
following the citations and warnings this does not excuse the
violations. The respondent's continued history of non-compliance with
the Act has defeated some of its prime purposes which are to
eliminate unregistered, adulterated, and misbranded pesticides from
the channels of commerce.
The nature of the violations charged in this case ((1) composition
differed from that presented in connection with registration and (2)
misbranding in that ingredients stated on label of product differed
from ingredients stated on label approved in connection with
registration) are so closely connected that we are imposing a single
penalty for the violations.
In determing the appropriateness of the penalty, we have
considered not only the gravity of the violations but also the size of
respondent's business and effect on respondent's ability to continue
in business.
In addition to Mr. Beaulieu and his wife, the company has nine
employees. Its sales in 1973 were $527,000 an increase of some
$75,000 over 1972. The net profit in 1973 was $31,000, an increase
of $10,000 over 1972. Mr. Beaulieu's taxable income increased
almost four-fold from 1970 through 1973. It is apparent that
respondent is engaged in a profitable and growing business.
" An accountant's report, prepared without audit, for the year
ending December 31, 1973, shows assets of $230,403 including cash
of $13,000 and collectible accounts receivable of $80,000.
Liabilities, including long term liabilities of $55,600, are shown as
$258,000 for a new worth deficit of approximately $28,000. We
have concluded that imposition of a penalty of $1,500 will not effect
respondent's ability to continue in business.
The proposed Finding of Fact and Conclusions submitted by the
parties have been considered. To the extent that they are consistent
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with Findings of Fact and Conclusions herein, they are granted, other-
wise they are denied.
Having considered the entire record and based on the Findings
of Fact and Conclusions herein, it is proposed that the following order
be issued.
Final Order
Pursuant to section 14(a)(l) of the Federal Insecticide, Fungicide
and Rodenticide Act, as amended (7 U.S.C. 136JJa)(l)}, a civil pe-
nalty of $1,500 is assessed against Beaulieu Chemical Company
(John L Beaulieu, owner), Stockton, California, for violations of said
Act which have been established on the basis of amended complaint
filed on February 13, 1974.
Bernard D. Levinson
Administrative Law Judge
July 24,1974
'The Federal Insecticide, Fungicide, and Rodenticide Act, as it existed
prior to the 1972 amendments (FIFRA 1947), was amended by the
Federal Environmental Pesticide Control Act of 1972 (FEPCA), P.L
92-516. FIFRA 1972 has been codified in 7 U.S.C. 136 et seq.
2Original complaint was issued September 10, 1973.
3This reference is to FIFRA 1947. The registration provisions of FIFRA
1947 and regulations thereunder remain in effect until superseded by
new registration regulations which are required to be promulgated by
October 21, 1974. See sections 4(b) and 4(c)(l) of FEPCA. New
registration regulations have not yet been promulgated.
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4The term "respondent" herein refers to Beaulieu Chemical Company
of which John L Beaulieu is the sole owner. See Finding of Fact No. 1,
infra.
5Under section 3 of FIFRA 1972 all pesticides are required to be
registered, whether distributed interstate or intrastate. However, this
requirement is not effective until new regulations are promulgated.
See footnote 3.
'Reorganization Plan No. 3 of 1970, 35 F.R. 15623, established the
Environmental Protection Agency and, among other things, trans-
ferred from the Department of Agriculture to EPA the functions under
the Federal Insecticide, Fungicide, and Rodenticide Act.
7At the hearing counsel for complainant stated that at the time of re-
gistration, the label that was approved permitted the phosphoric acid
to be included as an inert ingredient, but that the present policy of the
Registration Division is to require phosphoric acid to be listed as an
active ingredient.
8There were three analyses for titratable iodine which showed
2.12%, 2.15% and'2.15%, an average of 2.14%. There were two
analyses for phosphoric acid which showed 7.83% and 7.86%, an
average of 7.85%. The differences in analyses were within the range
of experimental error.
'Although intent is not an element of an offense in a civil penalty
assessmentcase (cf. U.S. v. Dotterweich, 320 U.S. 277), intent to
violate may be an aggravating factor.
"Counsel for complainant explained the difference between a
citation and warning letter as follows:
MR. JAFFE: A citation is a letter which was sent as a
precursor for possible criminal action, a serious violation.
A letter of warning is a violation which was felt not to be
serious enough to warrant the possibility of any criminal
action but merely to point out to the recipient of the letter
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that they had violated) the taw in a particular manner
and that it should be corrected.
The citations and warning letters were issued pursuant to section
6(c) of FIFRA 1947 {7 U.S.C, 135 d(c)).
"This charge was made against three shipments of the same product.
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Index to Notices of Judgment 1451 - 1500
NJ. No.
AG Manufacturing Company (Criminal) 1488
AG Supply Company, Inc. (Criminal) 1489
Agway, Inc., Chemical Division (Civil) 1462
Amvac Chemical Corporation (Civil) 1499
B & G Equipment Co. (Civil) 1477
Baird & McGuire, Inc. (Criminal) 1454
BeauEieu Chemical Company (Civil) 1500
Cape Fear Chemicals, Inc. (Criminal) 1490
Carter & Company (Criminal) 1491
Chem Servs-Div. Imoco Gtwy (Civil) 1476
Chemex Chemicals & Coating Co., Inc.
(Civil) 1484
Chemical Packaging Corp. (Criminal) 1493
Contract Packaging, Inc. (Civil) 1498
Crosby Forest Products Company (Civil) 1486
Ecological and Specialty Products, Inc.
(Civil) 1463
8-in-l Pet Products, Inc. (Civil) 1461
H. Clay Glover Co., Inc. (Civil) 1464
H. G. Hastings Company (Civil) 1480
Harris Paint Company (Criminal) 1494
Hortus Products Co. (Civil) 1465
Inco Chemical Supply Company, Inc.
(Criminal) 1495
Independence Chemical Co. (Civil) 1467
industrial Colloids & Chemicals, Inc.
(Civil) 1481
Industrial Water Chemicals Co, Inc.
(Criminal) 1487
International Paint Co., Inc. (Civil) 1457
Inter-State Nurseries, Inc. (Civil) 1497
Johnson Chemical Company, Inc. (Civil) 1475
Johnson Nurseries (Civil) 1472
Luminal Paints (Civil) 1474
M & M Chemical Sales Corporation (Civil) 1453
Mallinckrodt Chemical Works (Civil) 1455
Middlebrooke Lancaster, Inc. (Civil) 1473
1007
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Para Laboratories (Civil) 1470
Parrott Chemical Company, The (Civil) 1451
Pearson & Company (Civil) 1478
Q-Pak Corporation (Civil) 1459
Riga Chemical Company (Criminal) 1492
Sonford Products Corporation (Civil) 1482
Southern Mill Creek Products, Inc.
(Civil) 1479
Stauffer Chemical Company, Inc. 1496
Straight Arrow, Inc. (Civil) 1469
Tennessee Farmers Co-Operative (Civil) 1483
Terre Company, The (Civil) 1460
Trio Chemical Works, inc. (Civil) 1456
U.S. Pol/chemical Corp. (Civil) 1466
Van Brode Milling Company, Inc. (Civil) 1452
Wilbert Products Co., Inc. (Civil) 1471
Will & Baumer Candle Co., Inc. (Civil) 1468
Woolfolk Chemical Works, Ltd. (Civil) 1485
York Chemical Company, Inc. (Civil) 1458
lOOfi
«JS. GOVERNMENT PRINTING OFFICE:1975 582-423/294 1-3 ' vvo
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