RIVES, Circuit Judge.
The order of the Secretary of Agriculture was made through the Judicial Officer pursuant to authority delegated1 as authorized by Congress.2 The opinion of the Judicial Officer comprises some fifty pages of the printed record, and is reported in 20 Agriculture Decisions 306. It concludes with the following order:
"Effective May 22, 1961, the registration of Volkart Brothers Company as a futures commission merchant and the registration of Alfred Boedtker as a floor broker are suspended for a period of 15 days.
"Effective May 22, 1961, all contract markets shall refuse all trading privileges to Volkart Brothers, Inc., Volkart Brothers Company, Alfred Boedtker and Kurt Muller, for a period of 15 days, such refusal to apply to all trading done and positions held directly by any of the said persons or firms, and also to all trading done and positions held indirectly through persons owned or controlled by them, or any of them, or otherwise."3
The New York Cotton Exchange and the New Orleans Cotton Exchange are designated contract markets under the Commodity Exchange Act.4 Volkart Brothers, Inc., is engaged in merchandising cotton and other commodities and is a member of each of said Exchanges. Volkart Brothers Company is a partnership licensed as a carrying broker on the New York Cotton Exchange. Alfred Boedtker is President of Volkart Brothers, Inc., and a partner in Volkart Brothers Company, and is also a registered floor broker under the Commodity Exchange Act, and a member of each of said Exchanges. Kurt Muller is Vice President of Volkart Brothers, Inc., a partner in Volkart Brothers Company, and a member of the New Orleans Cotton Exchange.
The Judicial Officer found the petitioners guilty of "manipulating" and attempting to manipulate the price of October 1957 cotton futures on the New York Cotton Exchange and on the New Orleans Cotton Exchange in violation of Sections 6 (b)5 and 96 of the Commodity Exchange Act.
The operation of a commodity futures exchange is well described in the amicus curiae brief filed by the New York Cotton Exchange:
"A futures exchange performs a valuable economic function in the public interest. Risks in business must be paid for. They are generally passed on to the consumer. To the extent that they can be eliminated or reduced, the consumer benefits. It is the function of the commodity futures market to eliminate or reduce the risk of price fluctuations in the process by which a commodity moves from grower to consumer. The method whereby this is accomplished using the cotton business as an example, is as follows:
"Contracts on the exchange call for the purchase or sale of cotton for future delivery during a specified month from one to eighteen months from the date the contract is made. A person engaged in the production, manufacture or sale of cotton may take a position on the exchange by buying or selling cotton for future delivery to offset his purchase or commitments in the actual commodity and thus hedge (insure) against price fluctuations. This can be illustrated by the example of a merchant who sells spot cotton for delivery to a mill six months from now at a fixed price which gives him a fixed profit based upon current spot prices. He does not now have the cotton and therefore takes the risk of a change in the spot price when he is to acquire it to fulfill his commitment to deliver. To guard against this risk of a change in price, he takes a long position on the futures market of an equivalent amount of cotton (i. e., he makes a contract to purchase cotton for future delivery on the exchange). If the price of spot cotton increases during the six-month period, the price of futures will tend to increase correspondingly and the loss he sustains in having to pay a higher price for spot cotton will be offset by the gain in price on the futures market when he closes out his futures contract at a profit. In another case, the merchant purchases cotton for inventory from a farmer at a fixed price. To avoid the risk of a change in price when he is ready to sell it, he takes a short position on the futures market (i. e., he makes a contract to sell cotton for future delivery on the exchange). If the price of spot cotton decreases, the price of futures will tend to decrease correspondingly and the loss he sustains in the value of his inventory will be offset by his gain on the futures market when he closes out his futures contract at a profit.
"The futures exchange is used by those who grow, manufacture, process, sell and utilize cotton and cotton products and wish to hedge against price fluctuations. Since there are not an equal number of hedgers taking long and short positions on the exchange, speculators are invited into the futures market and for an expected profit they act as insurers for those who deal with the actual commodity.
"For every contract to purchase cotton on a futures exchange there is a corresponding contract of sale. As the delivery month approaches, contracts are generally offset against each other. A long enters into a contract to sell and his purchase and sale contracts offset each other. A short enters into a contract to purchase and his sale and purchase contracts offset each other. Contracts not thus offset remain `open\' and if open on the last trading day must be performed by the delivery of the actual commodity by the short and receipt and payment therefor by the long.
"Delivery does not mean the physical delivery of actual cotton. It means the delivery of warehouse receipts for cotton inspected, classified and stored in approved warehouses and the transfer of such documents is handled between clearing members of the exchange.
"Contracts on a futures exchange are not made by the parties in interest, but by members of the exchange who enter into contracts on behalf of their customers with other members of the exchange also acting for their customers.
"A contract on a futures exchange may be performed either by offset on the exchange or by delivery and receipt of warehouse receipts for the physical commodity. Most contracts are performed by offset on the exchange in the manner described above.
"The liquidation of futures contracts on an exchange by offset, in the main, instead of by delivery is to be expected because of the manner in which the exchange is utilized. The speculator does not deal in the actual commodity but uses the exchange in the expectation of making a cash profit resulting from fluctuations in prices on the exchange. The hedger, who deals in the commodity, is also generally interested in liquidating his futures contracts on the exchange for cash because any loss he sustains on his spot commitments if the price moves against him is expected to be offset by his profit on the futures market, and any gains resulting from price changes in the spot market is expected to be offset by a loss on the futures market.
"However, despite the fact that most contracts on futures markets are liquidated by offset, it is well settled that a commodity exchange which did not require a short to deliver at maturity and a long to receive the commodity at maturity would be a gambling institution. The legality of every futures exchange rests on the obligation of the parties to the futures contract to deliver or take delivery of the commodity unless the contract has been liquidated by offset on the exchange.
"`The intent to deliver or to receive delivery is thus vital in determining whether or not the transaction is legal. The bylaws of commodity exchanges do not leave this question open to argument or dispute. The exchange contract provides for delivery or acceptance of delivery and neither broker nor customer has any choice in the matter. It is as certain as anything can be that a party who buys or sells a futures contract and does not offset it by a contra transaction will receive the commodity or be called upon to deliver.\' "Baer and Saxon, Commodity Exchanges and Futures Trading, p. 305 (1949).
"The Rules of the New York Cotton Exchange specifically provide that futures contracts made on the Exchange are binding until fulfilled by delivery of the cotton and payment therefor, and that a contract entered into with an understanding that it is not to be so fulfilled is forbidden (Rule 3.03(1)).
"Thus, the fundamental principle underlying all commodity exchanges is that a person who buys or sells a futures contract and does not offset it by a contra-transaction on the exchange must receive the commodity or be called upon to deliver it. The fact that most persons who trade on a commodity exchange expect to offset their contracts before the date of delivery or receipt is not a denial of this principle."
The Judicial Officer found that, "The basic facts, or most of them, are not in dispute." He summarized the pivotal facts as follows:
"At the opening of the trading session October 15, 1957, the total open interest on both exchanges was 13,400 bales, i. e., there were unliquidated futures in that amount held by shorts against the same quantity held by longs. On the long side Volkart had 12,100 bales and other longs had 1300 bales. On the short side the 13,400 bales had to be covered before the end of trading October 15, 1957, by the purchase of futures or the delivery of certificated cotton
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