USDA enforcing court order against Plainville Livestock Commission, Inc.

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Published Tuesday, April 30, 2019
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by Chris Sorensen

The United States Department of Agriculture's Agricultural Marketing Service has taken steps to enforce a consent decree against Plainville Livestock Commission, Inc., and Tyler D. Gillum for violations of the Packers and Stockyards Act. The enforcement comes after the USDA determined that violating the P&S Act and consent decree.

In July 2018, the Plainville, Kansas, market agency agreed to suspend its commissioned livestock stales for two days and pay a civil penalty of $117,750. Of that amount, $67,750 was suspended for six years, with the remaining $50,000 paid in installments.

This month's action requires that the full $117,750 be paid, and Gillum surrendered his Packers and Stockyards registration with the Secretary of Agriculture. He cannot seek registration for at least 10 years. Gillum and Plainville Livestock Commission, Inc. are also barred from managing, owing, or engaging as a market agency selling livestock on commission or agency basis for the next 10 years according to terms of the settlement agreement.

The USDA earlier this year determined that Plainville and Gillum were again violating the P&S Act and 2018 consent decree. A motion was filed with the United States District Court for the District of Kansas to enforce the decree. In late March, the court entered an order accepted by the United States, Plainville and Gillum that resulted in the full enforcement.

Gillum is also barred from working as a contractor, consultant, or doing other work for companies selling livestock on commission or as an agency that could require him to manage a company's custodial account. A custodial account is a separate bank account that holds money for livestock sellers. Having a custodial account that is short of funds is a violation of the P&S Act, and places sellers at risk of delayed payments or no payment at all.

In addition to the financial penalties, the 2018 consent decree prevented Plainville and Gillum from

  • engaging in business without properly maintaining its custodial account for shipper's proceeds
  • engaging in business without properly remitting sales proceeds before the close of the next business day following the sale
  • issuing checks or any kind of payment instrument in purported payment of livestock purchases without having maintaining sufficient funds on deposit and available in the custodial account upon which the checks or instruments are drawn to pay the checks or instruments when presented for payment
  • engaging in business without properly maintaining all business records.

The company has had past issues with maintaining custodial accounts. In 2012, Plainville was subject to a Consent Decision and Order issued by the Secretary of Agriculture that required Plainville to cease and desist for failing to maintain its custodial account for shipper's proceeds in full compliance with the P&S Act.  A second Consent Decision and Order issued by the Secretary March 4, 2014, likewise ordered Plainville to cease and desist for failing to maintain its custodial account for shipper's proceeds in strict conformity with the P&S Act.

The P&S Act is intended to protect fair trade and payments for the livestock, meat, and poultry industries.