ACTS OF THE TWENTY-FIFTH LEGISLATURE
CHAPTER 7-Food and Drugs
SENATE BILL NO. 305
AN ACT to prevent the practice of subsidizing, in the business of dealing In milk, cream, ice cream, frozen
desserts, and other dairy products, and making unlawful the doing of certain acts by processors, whole-
salers, or distributors of milk, cream, ice cream, frozen desserts, and other dairy products; defining
terms; providing penalties for the violation hereof; limiting the applicability of the Act; making the
provisions of the Act severable; repealing all laws or parts of laws in conflict herewith; and declaring
an emergency.
SECTION 1. Legislative Intent. The practice being conducted by many
dairy processing, wholesaling, and distributing plants in Oklahoma, in the sub-
sidization of retail dealers, through secret discounts, and the furnishing of
equipment, is forcing numerous dairy plants out of business, and is a practice
which adversely affects the stable economy of Oklahoma. Such practice tends
to reduce the price paid to the dairy producer, increase the price paid by the
consumer, and is detrimental to the welfare of the State.
SECTION 2. Definitions. (a) The term "dairy products" means milk or
cream or any products manufactured in whole or in part from milk or cream
and includes ice cream and frozen dairy desserts as defined in Section 418.1,
Title 2, 0. S. 1951.
(b) The term "wholesaler" means any person, firm, or corporation en-
gaged in the business of selling dairy products for resale.
(c) The term "processors" means any person, firm or corporation engaged
in the business of processing milk or cream, or processing or manufacturing
dairy products.
(d)  The term   "distributor" means any person, firm, or corporation en-
gaged in the business of distributing dairy products for resale.
(e)  The term "retail dealer" shall mean any person, firm or corporation
who sells or distributes dairy products at retail to the consumer. Provided,
howevcr, that persons, firms, or corporations engaged in the distribution of
dairy ;roducts direct to consumers on Army, Navy, or Air Force bases, or U.S.

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Government reservations, shall not be deemed retail dealers. Wholesalers, pro-
cessors, or distributors who are also engaged in making home deliveries of dairy
products shall not, for the purpose of this Act, be deemed retail dealers.
SECTION 3. Dairy Processing, Wholesaling, and Distributing Plants-
Acts Unlawful. From and after the passage of this Act, it shall be unlawful
for any person, firm, corporation, or others associated therein, or employed
thereby, engaged in business as a wholesaler, processor, or distributor of dairy
products, individually or through or by affiliates, subsidiaries, associates, agents,
or stockholders, directly or indirectly, to do or cause to be done any of the
following acts:
(a) Furnish, give, rent, lease or lend to a retail dealer in dairy products
any equipment, fixtures, supplies, or other things having a real or substantial
value (except that he may sell dairy products) and ice cream cabinets and bulk
milk dispensers and any expendable supplies commonly provided in connection
with sales of dairy products to the consumer, subject to the terms and conditions
as provided in this Act. Any gratuitous loan arrangement covering any equip-
ment or fixtures existing between any wholesaler, processor, or distributor, on
the one hand, and any retail dealer on the other, shall become automatically
terminated at the end of fourteen (14) months after the passage and adoption
of this Act. Any wholesaler, processor, or distributor owning any such loaned
equipment may, however, within ninety (90) days from the date of such term-
ination sell such equipment to any retail dealer, without being deemed in
violation of this Act, provided such equipment is sold in compliance with the
terms and conditions relating to the sale of ice cream cabinets and bulk milk
dispensers, as set forth in Section 3(b) of this Act. In the event such sale as
provided herein is not consummated within ninety (90) days from the date of
such termination, then all such equipment on gratuitous loan with any retail
dealer shall be removed from the premises of such retail dealer by the whole-
saler, processor, or distributor owning the same. Provided further that the
prohibition against leasing of equipment herein shall not apply to leases of retail
outlets entirely owned by such wholesaler, processor, or distributor. Provided,
further that this paragraph shall not be construed to prohibit the furnishing
of normal point-of-purchase advertising matter to retail dealers in dairy pro-
ducts. No outside advertising so furnished, however, shall advertise items other
than milk, cream, or dairy products of such wholesaler, processor, or distributor,
except that such wholesaler, processor, or distributor may allocate not in excess
of one-third (1/3) of the advertising space of such outdoor advertising to the
retail dealer on whose owned or leased premises the same as placed.
(b) Sell to any retail dealer any fixture or equipment other than ice
cream cabinets and/or bulk milk dispensers, or sell to any retail dealer any ice
cream cabinet or bulk milk dispenser, except at a price not less than the
manufacturer's original list price after deducting an allowance for depreciation
computed on a basis of fifteen per cent (15%) annually of such manufacturer's
list price from the date of manufacture, and adding thereto as a proportionate
cost of doing business a markup of five per cent (5%) of the net price after
such deduction for depreciation; and if such deductions for depreciation after
adding such five per cent (5%) of the net, shall exceed ninety per cent
(90%) of such manufacturer's list price, then in no event shall such sale price
be less than ten per cent (10%) of such manufacturer's list price; and provided
further that such sales shall be made either for cash, or shall be evidenced by
a valid conditional sales contract or a note and mortgage specifically describing
such equipment or fixtures, and which contract or chattel mortgage shall be
duly filed in the office of the appropriate county clerk; and the indebtedness
secured thereby shall be truly recited, and shall be payable and paid in monthly
installments, each of which shall be not less than one-thirtieth (1/30) of such
total indebtedness, and the last payment shall mature on a date not later than
thirty (30) months from the date of such sale. All deferred payments shall carry
six per cent (6%) simple interest per annum. The recorded evidence of such
indebtedness shall also recite the true amount of the cash payment, if any, made
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Title 63

PUBuo IHEALTH AND SAFETY

Chapter 7

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ACTS OF THE TWENTY-FIFTH LEGISLATURE
by the retail dealer, or the.value of any fixture or equipment accepted by the
wholesaler, processor, or distributor as a trade-in credit, to apply on the pur-
chase price of such fixture or equipment, but in no event shall such trade-in
or exchange credit .exceed the minimum amount for which such exchanged or
trade-in equipment or fixture could be sold by a wholesaler, processor, or dis-
tributor to a retail dealer under the terms of this Act. The recorded evidence
of such indebtedness shall also contain a provision accelerating, at the option
of the seller, the entire unpaid balance, in the event a default in the payment
of any monthly installment exists and continues for a period of thirty (30)
days; and provided further in the event of such sale, the mechanical or electrical
servicing of such equipment shall become the responsibility of the retail dealer,
but may be furnished by such wholesaler, processor or distributor, provided a
reasonable charge is made and collected for such service.
(c) Fail, neglect, or refuse to remove, repossess, or institute an appropriate
replevin action to recover any fixture or equipment sold to any retail dealer
under a conditional sales contract or secured by chattel mortgage as authorized
by the provisions of this Act, if such retail dealer has been in default of pay-
ment for more than ninety (90) days on any installment provided in such
contract.
(d) Pay or credit a retail dealer in dairy products for any advertising,
display, or distribution service.
(e) Guarantee or procure another to guarantee any loan or the payment of
any financial obligation of a retail dealer in dairy products.
(f) Extend credit to a retail dealer in dairy products, extending past the
normal periods of payment commonly prevailing in the business territory of
the sale.
(g) Offer or give any bonus, premium, or compensation to retail dealer,
or officer, employee, associate, relative, or representative of a retail dealer in
dairy products.
:   (h) Sell, offer for sale, or contract to sell dairy products to any retail
dealer on consignment, or with the privilege of return, or on any basis other
than a bona fide sale. Provided, however, this provision shall not preclude the
practice of replacing dairy products which have become spoiled or damaged.
(i) Use or employ any device or scheme to subsidize in any manner any
retail dealer in dairy products.
(j) Permit any retail dealer in dairy products to do for such wholesaler,
processor, or distributor of dairy products any of the above acts hereby made
unlawful to be done, on behalf of such retail dealer in dairy products.
(k) Sell any dairy products, unit, or combination thereof, for less than
cost to the wholesaler, processor, or distributor at the point of sale; or sell to
any retail. dealer any expendable supplies for less than cost to any such whole-
saler, processor, or distributor at the point of sale plus a markup of five per
cent (5%) of such cost as a proportionate share of the cost of doing business,
except a person may sell either such dairy products or expendable supplies at
such prices as may be necessary to meet existing competition. Competent
evidence of the prevailing cost to other such wholesalers, processors, or dis-
tributors engaged in selling dairy products on the same market shall constitute
prima facie evidence of the cost to any person, firm, or corporation charged
with violation of this provision.
(1) Grant, either directly or indirectly, to any retail dealer any secret dis-
count, make any rebate, or permit any deviation from the price at which he
furnishes dairy products of the same quality, brand, and quantity to other
retail dealers in the same city, town, or immediate vicinity thereof, except
that deviations from posted prices may be given when necessary to meet exist-
ing competition. Provided, however, that bids, deviating from posted prices,
made pursuant to invitations issued by Federal institutions or installations, may
be filed, and contracts entered into, and fulfilled, without being deemed in
violation of the provisions of this Act.

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SECTION 4. Violations and Penalty. Each day during which, and each
point at which, a violation exists or continues shall constitute a separate of-
fense and violation, and each violation of this Act shall be a misdemeanor on
the part of each person participating therein; and upon final conviction hereof
each violator shall be punished by a fine of not more than Five Hundred Dol-
lars ($500.00) for each such violation, and not more than Five Thousand Dollars
($5,000.00) for any consecutive series of violations committed in transactions
with the same person, firm, or corporation.
SECTION 5. Action for Injunction. In addition to the penalties provided
in this Act, any person injured by any violation, or who shall suffer injury
from any threatened violation of this Act, may maintain an action in any court
of equitable jurisdiction to prevent, restrain, or enjoin such violation or threat-
ened violation. If in such action such violation or threatened violation of this
Act shall be established, the court shall enjoin and restrain or otherwise pro-
hibit such violation or threatened violation and, in addition thereto, shall assess
in favor of the plaintiff and against the defendant the cost of suit, and the rea-
sonable attorney fees incurred by the plaintiff. In such action, if damages are
alleged and proved, the plaintiff in said action, in addition to such injunctive
relief and cost of suit and attorney fees, shall be entitled to recover from the
defendant the actual damages sustained by him.
SECTION 6. Association Authorized to Sue. Any duly organized and
existing trade association, whether incorporated or not, is hereby authorized to
institute and prosecute a suit or suits for injunctive relief and costs, provided
for under the terms of this Act, as the real party in interest for and on behalf of
one or more of the members of such association, when violation of this Act
directly or indirectly affects or threatens to affect or injure such member or
members or where violation of this Act threatens or otherwise affects such
member as provided therein.
SECTION 7. Evidence. Any defendant or any witness in any civil action
brought under the provisions of this Act may be required to testify, and any
defendant or any witness may, upon proper process, be compelled to produce
his books, records, invoices and all other documents of any such defendant or
witness into court and the same may be introduced as evidence, but no defend-
ant or any witness in such civil action shall be prosecuted or subjected to any
penalty or forfeiture for or on account of any transaction, matter or thing con-
cerning which he may thus be required to testify or produce evidence, docu-
mentary or otherwise, and no testimony thus given or produced shall be
received against him upon any criminal proceeding or investigation.
SECTION 8. Application of Act. The provisions of this Act shall apply
to the business of dealing in dairy products only, and if any Section, sentence,
subdivision or clause herein shall for any reason be held to be invalid or un-
constitutional, such decision shall not affect the validity of the remaining
portions of this Act.
SECTION 9. Repealing Clause. All Acts or parts of Acts in conflict here-
with are hereby repealed.
Approved the 10th day of June, 1955. Emergency.
CHAPTER 10-Narcotic Drugs.