FROM: U.S. COMMODITY FUTURES TRADING COMMISSION
CFTC Revokes Registrations of Georgia Resident Robert A. Christy and his Company, Crabapple Capital Group LLC
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today announced the revocation of the registrations of Robert A. Christy of Milton, Georgia, and his company, Crabapple Capital Group LLC (Crabapple) of Alpharetta, Georgia. Crabapple was registered with the CFTC as a Commodity Pool Operator and Commodity Trading Advisor, and Christy was registered as an Associated Person of Crabapple and listed as its sole principal.
On April 16, 2013, the CFTC Judgment Officer issued an Initial Decision on Default against Christy and Crabapple finding that they were statutorily disqualified from CFTC registration based on the consent Order of permanent injunction entered by the U.S. District Court for the Northern District of Georgia on October 16, 2012. The court’s Order, among other things, (1) finds that Christy and Crabapple violated the Commodity Exchange Act (CEA) and CFTC Regulations by engaging in fraud and misappropriation in connection with their operation of a Ponzi scheme, (2) permanently enjoins Christy and Crabapple from engaging in fraudulent conduct in violation of specified provisions of the CEA and CFTC Regulations, and (3) prohibits Christy and Crabapple from acting in any capacity requiring registration or acting as a principal or agent of a registrant. On May 16, 2013, the Judgment Officer’s Initial Decision became the Order of the Commission.
Saturday, May 25, 2013
Friday, May 24, 2013
NINE SITES ADDED TO SUPERFUND'S NATIONAL PRIORITIES LIST
FROM: ENVIRONMENTAL PROTECTION AGENCY
EPA Adds Nine Hazardous Waste Sites to Superfund’s National Priorities List
Agency also proposes to add an additional nine sites
WASHINGTON - Today the U.S. Environmental Protection Agency (EPA) is adding nine hazardous waste sites that pose risks to people’s health and the environment to the National Priorities List (NPL) of Superfund sites. EPA is also proposing to add another nine sites to the list. Superfund is the federal program that investigates and cleans up the most complex, uncontrolled or abandoned hazardous waste sites in the country to protect people’s health and the environment.
"Sites that pose serious risks to human health and the environment and warrant Superfund attention continue to be identified by EPA and our state partners," said Mathy Stanislaus, assistant administrator for EPA’s Office of Solid Waste and Emergency Response. "EPA continues to act on its statutory obligation to update the NPL annually and clean up hazardous sites to protect human health with the goal of returning them to communities for productive use. Superfund cleanups improve local economies, protect people’s health and improve overall quality of life in affected communities."
A site’s listing neither imposes a financial obligation on EPA nor assigns liability to any party. Updates to the NPL do, however, provide policymakers and the public with a list of high priority sites, serving to identify the size and nature of the nation’s cleanup challenges.
The Superfund program has provided important benefits for people and the environment since Congress established the program in 1980.Those benefits are both direct and indirect, and include reduction of threats to human health and ecological systems in the vicinity of Superfund sites, improvement of the economic conditions and quality of life in communities affected by hazardous waste sites, prevention of future releases of hazardous substances, and advances in science and technology.
By eliminating or reducing real and perceived health risks and environmental contamination associated with hazardous waste sites, Superfund actions frequently convert contaminated land into productive local resources and increase local property values. A recent study conducted by researchers at Duke and Pittsburgh Universities concluded that, while a site’s proposal to the NPL reduces property values slightly, making a site final on the NPL begins to increase property values surrounding Superfund sites. Furthermore, the study found that, once a site has all cleanup remedies in place, surrounding properties have a significant increase in property values as compared to pre-NPL proposal values.
Since 1983, EPA has listed 1,685 sites on the NPL. At 1,145 or 68 percent of NPL sites, all cleanup remedies are in place. Approximately 610 or 36 percent of NPL sites have all necessary long-term protections in place, which means EPA considers the sites protective for redevelopment or reuse.
With all NPL sites, EPA first works to identify companies or people responsible for the contamination at a site, and requires them to conduct or pay for the cleanup. For the newly listed sites without viable potentially responsible parties, EPA will investigate the full extent of the contamination before starting significant cleanup at the site. Therefore, it may be several years before significant EPA clean up funding is required for these sites.
The following nine sites have been added to the NPL:
• Macon Naval Ordnance Plant (former ordnance manufacturer) in Macon, Ga.;
• Pike and Mulberry Streets PCE Plume (former dry cleaner) in Martinsville, Ind.;
• Former United Zinc & Associated Smelters (former zinc smelter) in Iola, Kan.;
• Creese & Cook Tannery (Former) (former tannery and finishing facility) in Danvers, Mass.;
• Walton & Lonsbury Inc. (former chrome plating operation) in Attelboro, Mass.;
• Matlack, Inc. (former chemical transportation business) in Woolwich Township, N.J.;
• Riverside Industrial Park (former paint manufacturer) in Newark, N.J.;
• Clinch River Corporation (former pulp and paper mill) in Harriman, Tenn.; and
• 700 South 1600 East PCE Plume (ground water plume) in Salt Lake City, Utah.
The following nine sites have been proposed for addition to the NPL:
• Beck’s Lake (former automotive and hazardous waste dump) in South Bend, Ind.;
• Garden City Ground Water Plume (ground water plume) in Garden City, Ind.;
• Keystone Corridor Ground Water Contamination (ground water plume) in Indianapolis, Ind;
• Smurfit-Stone Mill (former pulp and paper mill) in Missoula, Mont.;
• Cristex Drum (former fabric mill) in Oxford, N.C.;
• Hemphill Road TCE (former chemical drum recycling) in Gastonia, N.C.;
• Collins & Aikman Plant (Former) (former automotive rubber manufacturer) in Farmington, N.H.;
• Wilcox Oil Company (former oil refinery) in Bristow, Okla.; and
• Makah Reservation Warmhouse Beach Dump (municipal and hazardous waste dump) in Neah Bay, Wash.
EPA is also proposing to change the name of the B.F. Goodrich site in Rialto, Cal., which EPA added to the NPL on September 23, 2009 (74 FR 48412). A settling work party has requested that EPA propose changing the site’s name to Locust Avenue; the proposed change is consistent with the terms of a consent decree lodged with the court and informs the public of the site’s geographic location.
EPA Adds Nine Hazardous Waste Sites to Superfund’s National Priorities List
Agency also proposes to add an additional nine sites
WASHINGTON - Today the U.S. Environmental Protection Agency (EPA) is adding nine hazardous waste sites that pose risks to people’s health and the environment to the National Priorities List (NPL) of Superfund sites. EPA is also proposing to add another nine sites to the list. Superfund is the federal program that investigates and cleans up the most complex, uncontrolled or abandoned hazardous waste sites in the country to protect people’s health and the environment.
"Sites that pose serious risks to human health and the environment and warrant Superfund attention continue to be identified by EPA and our state partners," said Mathy Stanislaus, assistant administrator for EPA’s Office of Solid Waste and Emergency Response. "EPA continues to act on its statutory obligation to update the NPL annually and clean up hazardous sites to protect human health with the goal of returning them to communities for productive use. Superfund cleanups improve local economies, protect people’s health and improve overall quality of life in affected communities."
A site’s listing neither imposes a financial obligation on EPA nor assigns liability to any party. Updates to the NPL do, however, provide policymakers and the public with a list of high priority sites, serving to identify the size and nature of the nation’s cleanup challenges.
The Superfund program has provided important benefits for people and the environment since Congress established the program in 1980.Those benefits are both direct and indirect, and include reduction of threats to human health and ecological systems in the vicinity of Superfund sites, improvement of the economic conditions and quality of life in communities affected by hazardous waste sites, prevention of future releases of hazardous substances, and advances in science and technology.
By eliminating or reducing real and perceived health risks and environmental contamination associated with hazardous waste sites, Superfund actions frequently convert contaminated land into productive local resources and increase local property values. A recent study conducted by researchers at Duke and Pittsburgh Universities concluded that, while a site’s proposal to the NPL reduces property values slightly, making a site final on the NPL begins to increase property values surrounding Superfund sites. Furthermore, the study found that, once a site has all cleanup remedies in place, surrounding properties have a significant increase in property values as compared to pre-NPL proposal values.
Since 1983, EPA has listed 1,685 sites on the NPL. At 1,145 or 68 percent of NPL sites, all cleanup remedies are in place. Approximately 610 or 36 percent of NPL sites have all necessary long-term protections in place, which means EPA considers the sites protective for redevelopment or reuse.
With all NPL sites, EPA first works to identify companies or people responsible for the contamination at a site, and requires them to conduct or pay for the cleanup. For the newly listed sites without viable potentially responsible parties, EPA will investigate the full extent of the contamination before starting significant cleanup at the site. Therefore, it may be several years before significant EPA clean up funding is required for these sites.
The following nine sites have been added to the NPL:
• Macon Naval Ordnance Plant (former ordnance manufacturer) in Macon, Ga.;
• Pike and Mulberry Streets PCE Plume (former dry cleaner) in Martinsville, Ind.;
• Former United Zinc & Associated Smelters (former zinc smelter) in Iola, Kan.;
• Creese & Cook Tannery (Former) (former tannery and finishing facility) in Danvers, Mass.;
• Walton & Lonsbury Inc. (former chrome plating operation) in Attelboro, Mass.;
• Matlack, Inc. (former chemical transportation business) in Woolwich Township, N.J.;
• Riverside Industrial Park (former paint manufacturer) in Newark, N.J.;
• Clinch River Corporation (former pulp and paper mill) in Harriman, Tenn.; and
• 700 South 1600 East PCE Plume (ground water plume) in Salt Lake City, Utah.
The following nine sites have been proposed for addition to the NPL:
• Beck’s Lake (former automotive and hazardous waste dump) in South Bend, Ind.;
• Garden City Ground Water Plume (ground water plume) in Garden City, Ind.;
• Keystone Corridor Ground Water Contamination (ground water plume) in Indianapolis, Ind;
• Smurfit-Stone Mill (former pulp and paper mill) in Missoula, Mont.;
• Cristex Drum (former fabric mill) in Oxford, N.C.;
• Hemphill Road TCE (former chemical drum recycling) in Gastonia, N.C.;
• Collins & Aikman Plant (Former) (former automotive rubber manufacturer) in Farmington, N.H.;
• Wilcox Oil Company (former oil refinery) in Bristow, Okla.; and
• Makah Reservation Warmhouse Beach Dump (municipal and hazardous waste dump) in Neah Bay, Wash.
EPA is also proposing to change the name of the B.F. Goodrich site in Rialto, Cal., which EPA added to the NPL on September 23, 2009 (74 FR 48412). A settling work party has requested that EPA propose changing the site’s name to Locust Avenue; the proposed change is consistent with the terms of a consent decree lodged with the court and informs the public of the site’s geographic location.
Thursday, May 23, 2013
OIL FIELD SERVICES COMPANY PAYS BACK WAGES FOR MISCLASIFICATION OF EMPLOYEES AS INDEPENDENT CONTRATORS
FROM: U.S. DEPARTMENT OF LABOR
Rigid Oil Field Services in Hydro, Okla., pays more than $51,000 in overtime back wages following US Labor Department investigation
HYDRO, Okla. — Rigid Oil Field Services LLC has agreed to pay $51,839 in overtime back wages to 28 current and former employees following an investigation by the U.S. Department of Labor's Wage and Hour Division, which found violations of the overtime and record-keeping provisions of the Fair Labor Standards Act. The company misclassified its employees as independent contractors.
The investigation by the division's Oklahoma City District Office determined that laborers at Rigid Oil Field Services LLC were employees and not independent contractors as the company claimed. As a result of this misclassification, the company violated the FLSA by failing to pay its employees the legally required overtime pay for hours worked in excess of 40 in a workweek. Additionally, Rigid Oil Services LLC failed to maintain hours worked and payroll records for the employees that were misclassified as independent contractors.
"The misclassification of employees as independent contractors presents one of the most serious problems facing affected employees, employers and the entire economy," said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest Region. "The workers were not only denied their proper overtime compensation, but they were cheated out of other required worker protections, such as unemployment insurance and workers' compensation."
The company has agreed to comply with the FLSA in the future and has secured a third party to help it ensure that employees received time and one-half their regular rate of pay for hours worked over 40 in a week. The employer also agreed to pay the back wages found due in full.
Too often, business models and practices result in employees being misclassified as something other than an employee, such as independent contractors or LLCs. Under the law, however, whether someone is an employee is determined by the actual relationship between the worker and the business — not by label or registration. Similarly, simply providing employees with 1099s instead of W-2s does not transform them into legitimate independent contractors under the FLSA. Misclassifying employees can result in workers being denied minimum wage, overtime pay, unemployment insurance and workers' compensation benefits. This makes it harder for low-wage workers to put food on the table and provide for their families. It means a greater chance of working in unsafe conditions and not being compensated when hurt on the job.
The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates, including commissions, bonuses, piece-rate earnings and incentive pay, for hours worked beyond 40 per week. In general, hours worked includes all time an employee must be on duty, or on the employer's premises or at any other prescribed place of work, from the beginning of the first principal work activity to the end of the last principal activity of the workday. Additionally, the law requires that accurate records of employees' wages, hours and other conditions of employment be maintained.
Rigid Oil Field Services in Hydro, Okla., pays more than $51,000 in overtime back wages following US Labor Department investigation
HYDRO, Okla. — Rigid Oil Field Services LLC has agreed to pay $51,839 in overtime back wages to 28 current and former employees following an investigation by the U.S. Department of Labor's Wage and Hour Division, which found violations of the overtime and record-keeping provisions of the Fair Labor Standards Act. The company misclassified its employees as independent contractors.
The investigation by the division's Oklahoma City District Office determined that laborers at Rigid Oil Field Services LLC were employees and not independent contractors as the company claimed. As a result of this misclassification, the company violated the FLSA by failing to pay its employees the legally required overtime pay for hours worked in excess of 40 in a workweek. Additionally, Rigid Oil Services LLC failed to maintain hours worked and payroll records for the employees that were misclassified as independent contractors.
"The misclassification of employees as independent contractors presents one of the most serious problems facing affected employees, employers and the entire economy," said Cynthia Watson, regional administrator for the Wage and Hour Division in the Southwest Region. "The workers were not only denied their proper overtime compensation, but they were cheated out of other required worker protections, such as unemployment insurance and workers' compensation."
The company has agreed to comply with the FLSA in the future and has secured a third party to help it ensure that employees received time and one-half their regular rate of pay for hours worked over 40 in a week. The employer also agreed to pay the back wages found due in full.
Too often, business models and practices result in employees being misclassified as something other than an employee, such as independent contractors or LLCs. Under the law, however, whether someone is an employee is determined by the actual relationship between the worker and the business — not by label or registration. Similarly, simply providing employees with 1099s instead of W-2s does not transform them into legitimate independent contractors under the FLSA. Misclassifying employees can result in workers being denied minimum wage, overtime pay, unemployment insurance and workers' compensation benefits. This makes it harder for low-wage workers to put food on the table and provide for their families. It means a greater chance of working in unsafe conditions and not being compensated when hurt on the job.
The FLSA requires that covered, nonexempt employees be paid at least the federal minimum wage of $7.25 per hour for all hours worked, plus time and one-half their regular rates, including commissions, bonuses, piece-rate earnings and incentive pay, for hours worked beyond 40 per week. In general, hours worked includes all time an employee must be on duty, or on the employer's premises or at any other prescribed place of work, from the beginning of the first principal work activity to the end of the last principal activity of the workday. Additionally, the law requires that accurate records of employees' wages, hours and other conditions of employment be maintained.
ACTING ASSISTANT AG RAMAN TESTIFIES BEFORE HOUSE SUBCOMMITTEE ON OVERSIGHT AND INVESTIGATIONS
FROM: U.S. DEPARTMENT OF JUSTICE
Acting Assistant Attorney General Mythili Raman Testifies Before the U.S. House Financial Services Subcommittee on Oversight and Investigations
~ Wednesday, May 22, 2013
Chairman McHenry, Ranking Member Green, and distinguished Members of the Subcommittee: Thank you for inviting the Department of Justice to appear before you today to discuss our efforts to combat financial crime. I am pleased to be here and am privileged to oversee the important work of the Criminal Division.
The Justice Department is committed to vigorously investigating allegations of wrongdoing at financial institutions and, along with our many law enforcement partners, holding individuals and corporations to account for their conduct.
Our track record in recent years shows our commitment to pursuing the most challenging and complex financial crime investigations in the country. Over the last three fiscal years alone, the Department has filed nearly 10,000 financial fraud cases against nearly 14,500 defendants. These prosecutions have led to stiff prison sentences for many defendants. Last year, for example, the Criminal Division and the U.S. Attorney’s Office in Houston secured a 110-year sentence for Robert Allen Stanford for orchestrating a 20-year, $7 billion investment fraud scheme – just one of numerous investment fraud schemes the Department has prosecuted in recent years.
We have been just as aggressive in bringing prosecutions involving the manipulation of the markets, as seen by the extraordinary success of the U.S. Attorney’s Office in Manhattan in an unprecedented string of insider trading cases over the last several years.
Our prosecutors and agents also continue to doggedly pursue health care fraudsters. Our Medicare Fraud Strike Force has convicted over 1,000 defendants of felony health care fraud offenses since the Strike Force’s inception, and the average sentence in Strike Force cases is approximately 45 months in prison.
Our fight against foreign bribery, too, is as robust as it has ever been. In just the past two months, we have announced charges against 11 individuals – including corporate executives and employees, and one foreign official – in active Foreign Corrupt Practices Act investigations.
Similarly, our investigation of the manipulation at various banks of interbank lending rates, including LIBOR, has had reverberations across the globe. As detailed in my written statement, the consequences thus far for several multinational banks have been far reaching, ranging from replacement of senior leaders at Barclays, to criminal charges against traders at UBS, to detailed admissions of criminal wrongdoing and the payment of substantial penalties by three global banks, to felony guilty plea agreements by Japanese subsidiaries of UBS and RBS.
As is evident from this track record, we are deeply committed to holding wrongdoers – whether individuals or business entities – to account for their crimes. In our investigations of business entities, in particular, we are guided by firmly rooted Department policy, set out in the U.S. Attorneys’ Manual, which requires our prosecutors to consider a number of factors in determining how and whether to bring charges – including the seriousness of the entity’s conduct, the pervasiveness of the wrongdoing, the extent of the entity’s cooperation with our investigation, and the remedial actions taken by the company.
There has been some discussion in recent months about one of those factors – the potential collateral consequences of charging a corporate entity – and we appreciate your interest in better understanding the extent to which the Department may consider possible collateral consequences of criminal prosecutions against large, complex financial institutions.
The consideration of collateral consequences on innocent third parties, like the other factors we must consider when determining whether and how to proceed against a corporation, has been required by the U.S. Attorneys’ Manual since 2008. But the basic principles underlying that policy have a much longer history at the Department. The first Department-wide guidance on this subject was issued in 1999, and those basic principles have been reaffirmed multiple times since then, including in 2003, 2006, and 2008.
As more fully explained in my written statement, although the factors set forth in the U.S. Attorneys’ Manual, for good reason, inform our prosecutorial decisions, none of those factors, including potential collateral consequences, acts as a bar to prosecution, or has prevented the Justice Department from pursuing investigations and seeking criminal penalties in cases involving large, complex financial institutions. No individual or institution is immune from prosecution, and we intend to continue our aggressive pursuit of financial fraud with the same strong commitment with which we pursue other criminal matters of national and international significance.
Thank you for the opportunity to provide the Subcommittee with this overview of our financial fraud enforcement efforts. I look forward to answering any questions you may have.
Acting Assistant Attorney General Mythili Raman Testifies Before the U.S. House Financial Services Subcommittee on Oversight and Investigations
~ Wednesday, May 22, 2013
Chairman McHenry, Ranking Member Green, and distinguished Members of the Subcommittee: Thank you for inviting the Department of Justice to appear before you today to discuss our efforts to combat financial crime. I am pleased to be here and am privileged to oversee the important work of the Criminal Division.
The Justice Department is committed to vigorously investigating allegations of wrongdoing at financial institutions and, along with our many law enforcement partners, holding individuals and corporations to account for their conduct.
Our track record in recent years shows our commitment to pursuing the most challenging and complex financial crime investigations in the country. Over the last three fiscal years alone, the Department has filed nearly 10,000 financial fraud cases against nearly 14,500 defendants. These prosecutions have led to stiff prison sentences for many defendants. Last year, for example, the Criminal Division and the U.S. Attorney’s Office in Houston secured a 110-year sentence for Robert Allen Stanford for orchestrating a 20-year, $7 billion investment fraud scheme – just one of numerous investment fraud schemes the Department has prosecuted in recent years.
We have been just as aggressive in bringing prosecutions involving the manipulation of the markets, as seen by the extraordinary success of the U.S. Attorney’s Office in Manhattan in an unprecedented string of insider trading cases over the last several years.
Our prosecutors and agents also continue to doggedly pursue health care fraudsters. Our Medicare Fraud Strike Force has convicted over 1,000 defendants of felony health care fraud offenses since the Strike Force’s inception, and the average sentence in Strike Force cases is approximately 45 months in prison.
Our fight against foreign bribery, too, is as robust as it has ever been. In just the past two months, we have announced charges against 11 individuals – including corporate executives and employees, and one foreign official – in active Foreign Corrupt Practices Act investigations.
Similarly, our investigation of the manipulation at various banks of interbank lending rates, including LIBOR, has had reverberations across the globe. As detailed in my written statement, the consequences thus far for several multinational banks have been far reaching, ranging from replacement of senior leaders at Barclays, to criminal charges against traders at UBS, to detailed admissions of criminal wrongdoing and the payment of substantial penalties by three global banks, to felony guilty plea agreements by Japanese subsidiaries of UBS and RBS.
As is evident from this track record, we are deeply committed to holding wrongdoers – whether individuals or business entities – to account for their crimes. In our investigations of business entities, in particular, we are guided by firmly rooted Department policy, set out in the U.S. Attorneys’ Manual, which requires our prosecutors to consider a number of factors in determining how and whether to bring charges – including the seriousness of the entity’s conduct, the pervasiveness of the wrongdoing, the extent of the entity’s cooperation with our investigation, and the remedial actions taken by the company.
There has been some discussion in recent months about one of those factors – the potential collateral consequences of charging a corporate entity – and we appreciate your interest in better understanding the extent to which the Department may consider possible collateral consequences of criminal prosecutions against large, complex financial institutions.
The consideration of collateral consequences on innocent third parties, like the other factors we must consider when determining whether and how to proceed against a corporation, has been required by the U.S. Attorneys’ Manual since 2008. But the basic principles underlying that policy have a much longer history at the Department. The first Department-wide guidance on this subject was issued in 1999, and those basic principles have been reaffirmed multiple times since then, including in 2003, 2006, and 2008.
As more fully explained in my written statement, although the factors set forth in the U.S. Attorneys’ Manual, for good reason, inform our prosecutorial decisions, none of those factors, including potential collateral consequences, acts as a bar to prosecution, or has prevented the Justice Department from pursuing investigations and seeking criminal penalties in cases involving large, complex financial institutions. No individual or institution is immune from prosecution, and we intend to continue our aggressive pursuit of financial fraud with the same strong commitment with which we pursue other criminal matters of national and international significance.
Thank you for the opportunity to provide the Subcommittee with this overview of our financial fraud enforcement efforts. I look forward to answering any questions you may have.
Wednesday, May 22, 2013
JUSTICE DEPARTMENT REACHES SETTLEMENT WITH CINEMARK
FROM: U.S. JUSTICE DEPARTMENT
Divestitures of Movie Theaters in Kentucky, New Jersey and Texas Will Preserve
Movie Theater Competition in Those Areas
WASHINGTON — The Department of Justice announced today that it has reached a settlement with Cinemark Holdings Inc. and Rave Holdings LLC (Rave Cinemas) that requires Cinemark to divest movie theaters in Kentucky, New Jersey and Texas, in order to proceed with its $220 million acquisition of Rave Cinemas movie theaters. In addition, Cinemark’s chairman is required to divest Movie Tavern Inc., which operates theaters in Ft. Worth and Denton, Texas, that compete with Rave Cinemas. The department said that the original deal is likely to lead to higher ticket prices for moviegoers and that the divestitures of theaters in Louisville, Ky., southern New Jersey, Fort Worth, and Denton or Hickory Creek, Texas, will preserve competition in those areas, benefitting consumers.
The department’s Antitrust Division and the state of Texas filed a civil lawsuit today in U.S. District Court in Washington, D.C., to block the proposed acquisition. At the same time, the department and the state of Texas filed a proposed settlement that requires the divestitures. If approved by the court, the settlement would resolve the lawsuit and the department’s and the state of Texas’ concerns about the competitive harm to consumers that would result from the acquisition.
"Cinemark’s proposed acquisition of Rave Cinemas would likely reduce competition among theaters showing first-run, commercial movies in the affected areas of Kentucky, New Jersey and Texas, causing moviegoers to pay higher ticket prices," said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. "The divestitures required by the department and the state of Texas will ensure that competition among movie theaters in the affected areas is preserved."
According to the complaint, the movie theaters compete on multiple dimensions to attract moviegoers, such as the quality of the viewing experience, sound systems, largest screens, best picture clarity, best seating, and quality of food and drinks. More than 1 billion movie tickets were sold in the United States in 2012, with total box office revenue reaching about $9.7 billion.
The department said that Cinemark and Rave Cinemas are each other’s most significant competitor in the area in and around Voorhees-Somerdale, N.J., and in the eastern portion of Louisville, Ky., and that Rave Cinemas and Movie Tavern are each other’s most significant competitor in the western portion of Fort Worth, Texas. In the area in and around Denton, Texas, all three companies presently operate theatres. In markets in which Movie Tavern and Rave Cinemas currently compete, the department said that Cinemark’s chairman, Lee Roy Mitchell, would have an ability and financial incentive to dampen competition once Rave Cinemas was acquired by Cinemark.
The proposed acquisition would likely reduce price competition among Cinemark, Rave Cinemas and Movie Tavern in the affected markets. The complaint states that if no longer motivated to compete, Cinemark, Rave Cinemas and Movie Tavern would also have less incentive to maintain, upgrade and renovate their theaters, to improve those theaters’ amenities and services and to license the most popular movies, reducing the quality of the viewing experience for the moviegoer.
The requirement to divest three movie theaters in the locations where Cinemark and Rave Cinemas are currently each other’s closest competitor and to require Mitchell to divest Movie Tavern and its 16 theaters will alleviate the competitive harm to moviegoers from this transaction.
Cinemark, a Plano, Texas-based company, owns and operates 298 theaters with a total of 3,916 screens in 39 states. Its U.S. box office revenues were approximately $1 billion in 2012.
Rave Cinemas, a Dallas-based company, owns and operates 35 movie theaters with a total of 518 screens in 12 states. Its U.S. box office revenues were approximately $169 million in 2012.
Movie Tavern, also a Dallas-based company, owns and operates 16 movie theaters with a total of 130 screens in seven states. Its U.S. box office revenues were approximately $31 million in 2012. Movie Tavern is owned by Alder Wood Partners L.P., a Dallas-based limited partnership controlled by Mitchell and his wife.
As required by the Tunney Act, the proposed settlement and the department’s competitive impact statement will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to John R. Read, Chief, Litigation III Section, Antitrust Division, U.S. Department of Justice, 450 5th Street, N.W., Suite 4000, Washington, D.C. 20530 (telephone: 202-307-0468). At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the proposed consent decree upon finding that it serves the public interest.
Divestitures of Movie Theaters in Kentucky, New Jersey and Texas Will Preserve
Movie Theater Competition in Those Areas
WASHINGTON — The Department of Justice announced today that it has reached a settlement with Cinemark Holdings Inc. and Rave Holdings LLC (Rave Cinemas) that requires Cinemark to divest movie theaters in Kentucky, New Jersey and Texas, in order to proceed with its $220 million acquisition of Rave Cinemas movie theaters. In addition, Cinemark’s chairman is required to divest Movie Tavern Inc., which operates theaters in Ft. Worth and Denton, Texas, that compete with Rave Cinemas. The department said that the original deal is likely to lead to higher ticket prices for moviegoers and that the divestitures of theaters in Louisville, Ky., southern New Jersey, Fort Worth, and Denton or Hickory Creek, Texas, will preserve competition in those areas, benefitting consumers.
The department’s Antitrust Division and the state of Texas filed a civil lawsuit today in U.S. District Court in Washington, D.C., to block the proposed acquisition. At the same time, the department and the state of Texas filed a proposed settlement that requires the divestitures. If approved by the court, the settlement would resolve the lawsuit and the department’s and the state of Texas’ concerns about the competitive harm to consumers that would result from the acquisition.
"Cinemark’s proposed acquisition of Rave Cinemas would likely reduce competition among theaters showing first-run, commercial movies in the affected areas of Kentucky, New Jersey and Texas, causing moviegoers to pay higher ticket prices," said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. "The divestitures required by the department and the state of Texas will ensure that competition among movie theaters in the affected areas is preserved."
According to the complaint, the movie theaters compete on multiple dimensions to attract moviegoers, such as the quality of the viewing experience, sound systems, largest screens, best picture clarity, best seating, and quality of food and drinks. More than 1 billion movie tickets were sold in the United States in 2012, with total box office revenue reaching about $9.7 billion.
The department said that Cinemark and Rave Cinemas are each other’s most significant competitor in the area in and around Voorhees-Somerdale, N.J., and in the eastern portion of Louisville, Ky., and that Rave Cinemas and Movie Tavern are each other’s most significant competitor in the western portion of Fort Worth, Texas. In the area in and around Denton, Texas, all three companies presently operate theatres. In markets in which Movie Tavern and Rave Cinemas currently compete, the department said that Cinemark’s chairman, Lee Roy Mitchell, would have an ability and financial incentive to dampen competition once Rave Cinemas was acquired by Cinemark.
The proposed acquisition would likely reduce price competition among Cinemark, Rave Cinemas and Movie Tavern in the affected markets. The complaint states that if no longer motivated to compete, Cinemark, Rave Cinemas and Movie Tavern would also have less incentive to maintain, upgrade and renovate their theaters, to improve those theaters’ amenities and services and to license the most popular movies, reducing the quality of the viewing experience for the moviegoer.
The requirement to divest three movie theaters in the locations where Cinemark and Rave Cinemas are currently each other’s closest competitor and to require Mitchell to divest Movie Tavern and its 16 theaters will alleviate the competitive harm to moviegoers from this transaction.
Cinemark, a Plano, Texas-based company, owns and operates 298 theaters with a total of 3,916 screens in 39 states. Its U.S. box office revenues were approximately $1 billion in 2012.
Rave Cinemas, a Dallas-based company, owns and operates 35 movie theaters with a total of 518 screens in 12 states. Its U.S. box office revenues were approximately $169 million in 2012.
Movie Tavern, also a Dallas-based company, owns and operates 16 movie theaters with a total of 130 screens in seven states. Its U.S. box office revenues were approximately $31 million in 2012. Movie Tavern is owned by Alder Wood Partners L.P., a Dallas-based limited partnership controlled by Mitchell and his wife.
As required by the Tunney Act, the proposed settlement and the department’s competitive impact statement will be published in the Federal Register. Any person may submit written comments concerning the proposed settlement during a 60-day comment period to John R. Read, Chief, Litigation III Section, Antitrust Division, U.S. Department of Justice, 450 5th Street, N.W., Suite 4000, Washington, D.C. 20530 (telephone: 202-307-0468). At the conclusion of the 60-day comment period, the U.S. District Court for the District of Columbia may enter the proposed consent decree upon finding that it serves the public interest.
Monday, May 20, 2013
U.S. SUES FISH PROCESSORS OVER FOOD SAFETY
FROM: U.S. DEPARTMENT OF JUSTICE
Friday, May 17, 2013
United States Sues Brooklyn Fish Processors in Food Safety Case
The Department of Justice has filed a lawsuit and sought a preliminary injunction against N.Y. Fish Inc.; New York City Fish Inc.; Maxim Kutsyk, Pavel Roytkov, Leonid Staroseletesky, and Steven Koyfman under the federal Food, Drug, and Cosmetic Act (FDCA). New York City Fish manufactures and distributes ready-to-eat fishery products, including smoked salmon and mackerel, and operates out of a food processing facility located at 738 Chester Street in Brooklyn. N.Y. Fish previously operated a similar fish processing business out of the same location, employing virtually all of the same employees. Although N.Y. Fish has ceased manufacturing, FDA believes that N.Y. Fish products continue to be distributed and sold. The complaint alleges that all defendants have a history of processing fishery products under insanitary conditions, with inadequate safety procedures.
"Consumers depend on food producers to follow the right procedures to make sure our food is safe to eat," said Acting Assistant Attorney General for the Civil Division Stuart F. Delery. "As this case demonstrates, the Department of Justice is committed to taking action against those who produce or process food under insanitary conditions or with inadequate safety procedures."
"Inspectors who visited the defendants’ facility found more than Nemo; they found life-threatening bacteria. Despite repeated warnings and direction to sanitize the facility, the defendants have failed to do so. They cannot be allowed to continue to distribute potentially unsafe food to our families. Those who store, package and sell the food that we eat must maintain basic standards of cleanliness in their facilities. We are committed to protecting the public from health risks by ensuring that food manufacturers comply with federal laws prohibiting them from preparing, packing and holding food products under insanitary conditions," stated Loretta E. Lynch, the United States Attorney for the Eastern District of New York.
According to the complaint, FDA conducted seven inspections of the Chester Street facility between 2006 and 2013. The inspections showed a repeated failure to minimize the risk of contamination by two dangerous types of bacteria: Listeria monocytogenes and Clostridium botulinum. People who eat food contaminated with Listeria monocytogenes can contract the disease listeriosis, which can be serious,even fatal,for vulnerable groups such as newborns and those with impaired immune systems. Complications from the disease can also lead to miscarriage. Clostridium botulinum spores can produce the toxin that causes botulism. Eating food tainted with this toxin can lead to paralysis and potentially death.
FDA’s most recent inspection occurred in February 2013, when New York City Fish was operating the Chester Street facility. According to court filings, the company missed critical processing steps that are essential to prevent the growth and toxin production of Clostridium botulinum and to eliminate any Listeria monocytogenes contamination, including heating fish for a dangerously short time and using insufficiently salty brining solution.
FDA previously investigated the facility in August 2012, when it was operated by N.Y. Fish. FDA inspectors discovered widespread sanitation problems and a similar failure to meet critical steps necessary to prevent contamination. They also found salmon products and production equipment contaminated with Listeria monocytogenes, even after the company attempted to clean and sanitize the facility.
Further testing by the FDA revealed that certain strains of Listeria monocytogenes it found likely had persisted in the Chester Street facility for years. FDA contends that the facility is so infiltrated with Listeria monocytogenes that New York City Fish must institute heightened monitoring and strict sanitation procedures to have any hope of eradicating this life-threatening organism, but that it has failed to do so.
The lawsuit is being brought by Assistant U.S. Attorney Elliot M. Schachner of the Eastern District of New York, and Trial Attorney Adrienne Fowler of the Civil Division’s Consumer Protection Branch, with the assistance of Associate Chief Counsel for Enforcement Julie Dohm of the FDA.
Friday, May 17, 2013
United States Sues Brooklyn Fish Processors in Food Safety Case
The Department of Justice has filed a lawsuit and sought a preliminary injunction against N.Y. Fish Inc.; New York City Fish Inc.; Maxim Kutsyk, Pavel Roytkov, Leonid Staroseletesky, and Steven Koyfman under the federal Food, Drug, and Cosmetic Act (FDCA). New York City Fish manufactures and distributes ready-to-eat fishery products, including smoked salmon and mackerel, and operates out of a food processing facility located at 738 Chester Street in Brooklyn. N.Y. Fish previously operated a similar fish processing business out of the same location, employing virtually all of the same employees. Although N.Y. Fish has ceased manufacturing, FDA believes that N.Y. Fish products continue to be distributed and sold. The complaint alleges that all defendants have a history of processing fishery products under insanitary conditions, with inadequate safety procedures.
"Consumers depend on food producers to follow the right procedures to make sure our food is safe to eat," said Acting Assistant Attorney General for the Civil Division Stuart F. Delery. "As this case demonstrates, the Department of Justice is committed to taking action against those who produce or process food under insanitary conditions or with inadequate safety procedures."
"Inspectors who visited the defendants’ facility found more than Nemo; they found life-threatening bacteria. Despite repeated warnings and direction to sanitize the facility, the defendants have failed to do so. They cannot be allowed to continue to distribute potentially unsafe food to our families. Those who store, package and sell the food that we eat must maintain basic standards of cleanliness in their facilities. We are committed to protecting the public from health risks by ensuring that food manufacturers comply with federal laws prohibiting them from preparing, packing and holding food products under insanitary conditions," stated Loretta E. Lynch, the United States Attorney for the Eastern District of New York.
According to the complaint, FDA conducted seven inspections of the Chester Street facility between 2006 and 2013. The inspections showed a repeated failure to minimize the risk of contamination by two dangerous types of bacteria: Listeria monocytogenes and Clostridium botulinum. People who eat food contaminated with Listeria monocytogenes can contract the disease listeriosis, which can be serious,even fatal,for vulnerable groups such as newborns and those with impaired immune systems. Complications from the disease can also lead to miscarriage. Clostridium botulinum spores can produce the toxin that causes botulism. Eating food tainted with this toxin can lead to paralysis and potentially death.
FDA’s most recent inspection occurred in February 2013, when New York City Fish was operating the Chester Street facility. According to court filings, the company missed critical processing steps that are essential to prevent the growth and toxin production of Clostridium botulinum and to eliminate any Listeria monocytogenes contamination, including heating fish for a dangerously short time and using insufficiently salty brining solution.
FDA previously investigated the facility in August 2012, when it was operated by N.Y. Fish. FDA inspectors discovered widespread sanitation problems and a similar failure to meet critical steps necessary to prevent contamination. They also found salmon products and production equipment contaminated with Listeria monocytogenes, even after the company attempted to clean and sanitize the facility.
Further testing by the FDA revealed that certain strains of Listeria monocytogenes it found likely had persisted in the Chester Street facility for years. FDA contends that the facility is so infiltrated with Listeria monocytogenes that New York City Fish must institute heightened monitoring and strict sanitation procedures to have any hope of eradicating this life-threatening organism, but that it has failed to do so.
The lawsuit is being brought by Assistant U.S. Attorney Elliot M. Schachner of the Eastern District of New York, and Trial Attorney Adrienne Fowler of the Civil Division’s Consumer Protection Branch, with the assistance of Associate Chief Counsel for Enforcement Julie Dohm of the FDA.
Sunday, May 19, 2013
FOREIGN EXCHANGE DEALER SETTLES CHARGES OF VIOLATING MINIMAL FINANICAL REQUIREMENT RULES
FROM: U.S. COMMODITIES FUTURES TRADING COMMISSION
May 14, 2013
CFTC Orders MB Trading Futures Inc., a Registered Retail Foreign Exchange Dealer, to Pay $200,000 Penalty to Settle Charges of Violating Minimal Financial Requirement Rules
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today issued an Order filing and settling charges against MB Trading Futures Inc. (MB Trading), a registered Retail Foreign Exchange Dealer (RFED) of El Segundo, California, for failing to comply with minimum financial requirements for registered RFEDs and Futures Commission Merchants (FCMs) that offer or engage in retail off-exchange foreign currency (forex) transactions. MB Trading has been registered with the CFTC as an FCM since February 28, 2006 and as an RFED since September 9, 2010.
Effective October 18, 2010, the CFTC adopted comprehensive new rules to protect individual investors that buy forex contracts from, or sell forex contracts to, forex firms. Under these rules, RFEDs and FCMs that offer or engage in retail forex transactions must at all times maintain adjusted net capital of $20 million, or more in some circumstances, and hold enough assets to meet or exceed their total retail forex obligations to customers. The new rules impose several restrictions on the types of funds that firms can include in their adjusted net capital and asset computations.
According to the CFTC Order, for more than 16 months after adoption of the new rules, between October 18, 2010 and March 1, 2012, MB Trading improperly included certain funds held in four accounts in its adjusted net capital computations. After excluding those funds as required, the Order finds that MB Trading failed to meet its adjusted net capital requirements for 456 calendar days between October 18, 2010 and March 1, 2012.
During the same period, MB Trading also improperly included certain funds held in two of the same accounts, along with funds held in a third account, in its asset computations, according to the Order. After excluding those funds as required, the Order finds that MB Trading failed to hold enough assets to meet or exceed its total retail forex obligation to customers for 501 calendar days between October 18, 2010 and March 1, 2012.
Had these funds properly qualified under the regulations, MB Trading would have complied with its adjusted net capital and asset requirements, according to the Order.
The CFTC Order imposes a $200,000 civil monetary penalty and a cease and desist order on MB Trading for these violations. The Order notes that in settling this matter, the CFTC took into account MB Trading’s cooperation and the corrective action it undertook after its deficiencies were discovered.
The CFTC appreciates the assistance of the National Futures Association.
CFTC Division of Enforcement staff responsible for this action are Stephanie Reinhart, Melissa Glasbrenner, William Janulis, Scott Williamson, Rosemary Hollinger, and Richard Wagner. Tom Bloom, Kurt Harms, Justin Beebe, and Lauren Fulks of the CFTC’s Division of Swap Dealer and Intermediary Oversight also assisted in this matter.
May 14, 2013
CFTC Orders MB Trading Futures Inc., a Registered Retail Foreign Exchange Dealer, to Pay $200,000 Penalty to Settle Charges of Violating Minimal Financial Requirement Rules
Washington, DC – The U.S. Commodity Futures Trading Commission (CFTC) today issued an Order filing and settling charges against MB Trading Futures Inc. (MB Trading), a registered Retail Foreign Exchange Dealer (RFED) of El Segundo, California, for failing to comply with minimum financial requirements for registered RFEDs and Futures Commission Merchants (FCMs) that offer or engage in retail off-exchange foreign currency (forex) transactions. MB Trading has been registered with the CFTC as an FCM since February 28, 2006 and as an RFED since September 9, 2010.
Effective October 18, 2010, the CFTC adopted comprehensive new rules to protect individual investors that buy forex contracts from, or sell forex contracts to, forex firms. Under these rules, RFEDs and FCMs that offer or engage in retail forex transactions must at all times maintain adjusted net capital of $20 million, or more in some circumstances, and hold enough assets to meet or exceed their total retail forex obligations to customers. The new rules impose several restrictions on the types of funds that firms can include in their adjusted net capital and asset computations.
According to the CFTC Order, for more than 16 months after adoption of the new rules, between October 18, 2010 and March 1, 2012, MB Trading improperly included certain funds held in four accounts in its adjusted net capital computations. After excluding those funds as required, the Order finds that MB Trading failed to meet its adjusted net capital requirements for 456 calendar days between October 18, 2010 and March 1, 2012.
During the same period, MB Trading also improperly included certain funds held in two of the same accounts, along with funds held in a third account, in its asset computations, according to the Order. After excluding those funds as required, the Order finds that MB Trading failed to hold enough assets to meet or exceed its total retail forex obligation to customers for 501 calendar days between October 18, 2010 and March 1, 2012.
Had these funds properly qualified under the regulations, MB Trading would have complied with its adjusted net capital and asset requirements, according to the Order.
The CFTC Order imposes a $200,000 civil monetary penalty and a cease and desist order on MB Trading for these violations. The Order notes that in settling this matter, the CFTC took into account MB Trading’s cooperation and the corrective action it undertook after its deficiencies were discovered.
The CFTC appreciates the assistance of the National Futures Association.
CFTC Division of Enforcement staff responsible for this action are Stephanie Reinhart, Melissa Glasbrenner, William Janulis, Scott Williamson, Rosemary Hollinger, and Richard Wagner. Tom Bloom, Kurt Harms, Justin Beebe, and Lauren Fulks of the CFTC’s Division of Swap Dealer and Intermediary Oversight also assisted in this matter.
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