MEMORANDUM ORDER

The Secretary of Labor seeks to enjoin the defendant packing shed operators, Paramount Citrus Association and Santa Clara Produce, Inc., from violating the Farm Labor Contractor Registration Act of 1963 (“FLCRA”), 7 U.S.C. § 2041 et seq. The cases were tried separately to the Court on stipulated facts. The issues are nearly identical and the Court has therefore consolidated the cases for purposes of this order.

The sole issue in each case is whether the defendant is a “farm labor contractor” within the meaning of section 3(b) of the FLCRA, 7 U.S.C. § 2042 (b), and thus subject to the registration provisions of that act. That section states, in pertinent part: “As used in this chapter—

7 U.S.C. § 2042 (b).

The Court finds that both Paramount Citrus and Santa Clara Produce recruit, hire and transport for agricultural employment persons who are “migrant workers” within the meaning of section 3(g) of the FLCRA. See 7 U.S.C. § 2042 (g) (defining “migrant worker”). The Court further finds that defendants are packing shed operators within the meaning of section 3(b)(2). The controversy centers on whether these packing shed operators “personally” recruit, hire and transport migrant workers, and whether they do so “solely for [their] own operation^],” so as to be excluded from the definition of a “farm labor contractor.”

1. The meaning of “personally” under section 3(b)(2)

The FLCRA was enacted in 1963 and amended in 1974. The only change made by the 1974 amendment to section 3(b)(2) was the addition of the word “personally.” The Secretary urges that the requirement that packing shed operators “personally” engage in the recruiting, hiring and transportation of migrant workers to be eligible for the section 3(b)(2) exclusion means that the exclusion is applicable only to individual proprietors and not to corporations. The Secretary contends that, because Paramount Citrus and Santa Clara Produce are corporations, they cannot claim to be excluded from the FLCRA’s registration requirements by section 3(b)(2). The Court disagrees.

The legislative history of the 1974 amendments to the FLCRA demonstrates how the word “personally” came to be included in section 3(b)(2). One purpose of the amendments was to improve the ineffective enforcement mechanisms provided by the 1963 act. Senate Report No. 93-1295, 4 U.S. Code Cong. & Admin.News 1974, pp. 6441, 6445. One defect in the prior enforcement mechanism was “the absence of any requirement that those who benefit from the work of migrant laborers assume responsibility for engaging only registered farm labor contractors.” Id. at 6443 . Congress’s efforts to include such a requirement in the 1974 amendments led to the addition of the word “personally” to section 3(b)(2).

Senate Committee Report No. 93-1206, dated October 1, 1974, contains a proposed amendment to the FLCRA that would have divided section 3(b)(2) into two subparts:

The word “personally” in the proposed amendment is used to distinguish an operator directly engaged in recruiting, hiring and transporting migrant workers from an operator indirectly — that is, through an agent or by contract — so engaged. The proposed amendment was clearly not intended to make the applicability of the exclusion depend on whether the operator was an individual proprietor or a corporation.

The amendment proposed in Senate Committee Report No. 93-1206 was not adopted as written. Instead, section 4(c) was added to the FLCRA:

The language is virtually identical to that contained in the Senate Committee Report’s proposed amendment to section 3(b)(2). Congress apparently decided that a direct prohibition of recruiting and hiring of migrant workers through unregistered contractors was preferable to enforcement through denial of the section 3(b)(2) exclusion. When the language was transferred to section 4(c), however, the word “personally” was not deleted from section 3(b)(2). Although the legislative history of the 1974 amendments provides a thorough explanation of the purpose and meaning of each other change in the FLCRA, that history offers no indication that the addition of the word “personally” to section 3(b)(2) was intended to modify the scope of the exclusion. See Senate Report No. 93-1295, 4 U.S.Code Cong. & Admin.News 1974, p. 6441 et seq.

The Secretary contends that his interpretation of “personally” is consistent with Congress’s determination in 1974 that agriculture is no longer a “ma and pa” business. Indeed, the Senate Report states that “[t]he small family farm, though still many in number, has been effectively replaced because of productivity by large commercial operations.” 4 U.S.Code Cong. & Admin.News 1974, p. 6442. There is no suggestion in the Report, however, that this advent of “agribusiness” compelled any narrowing of the section 3(b)(2) exclusion. One of the major purposes of the amendments was to further protect the supply of agricultural labor to “the primary users of such labor.” Id. With the advent of large commercial farming operations, the “primary users” clearly include farming and processing corporations. Neither the FLCRA nor its legislative history indicate that the 1974 amendments were designed to give more protection to individual proprie tors than to corporations, or to distinguish one from the other for purposes of any exclusion from the FLORA’S registration provisions.

The Court’s conclusion that the word “personally” does not preclude corporations from claiming the section 3(b)(2) “exclusion by the language” of the surrounding provisions of the FLCRA. Section 3(a) defines “person” to include a corporation. 7 U.S.C. § 2042 (a). Section 3(b)(3) refers to “any full-time or regular employee of any entity referred to in . . . [section 3(b)(2)] . . . .” 7 U.S.C. § 2042 (b)(3). The use of the word “entity” in reference to section 3(b)(2) clearly indicates that corporations as well as individuals may qualify for that section’s exclusion.

The legislative history of the 1974 amendments to the FLCRA demonstrate that the word “personally” in section 3(b)(2), to the extent it was intended to have any meaning, was used to mean “directly.” There is no indication in the FLCRA or its legislative history that “personally” was intended to preclude a corporation from claiming an exclusion under section 3(b)(2). The Court therefore concludes that both Paramount Citrus and Santa Clara Produce “personally” engage in the recruiting, hiring, and transportation of migrant workers within the meaning of section 3(b)(2) of the FLCRA. 7 U.S.C. § 2042 (b)(2).

2. “Solely for his own operation”

The term “farm labor contractor” does not include any packing shed operator who personally recruits, hires and transports migrant workers “solely for his own operation.” 7 U.S.C. § 2042 (b)(2). An interpretation and application of the phrase, “solely for his own operation,” depends upon the relationship between the policy underlying the FLCRA and the operations of the defendant packing shed operators.

The purpose of the FLCRA is to regulate middlemen who exploit migrant workers, farmers, processors and packers. Section 2 of the FLCRA provides in part:

Senate Report No. 93-1295, discussing the background of the 1963 legislation, states:

The Senate clearly intended to protect farmers and packers as well as migrant workers. The Senate Report states that “[t]he contractor’s unchallenged bargaining position is clearly one of detriment to both the farmworker and operator.” Id. The Department of Labor’s interpretation of section 3(b)(2) confirms this view:

The determinative question in these cases is whether defendants’ recruiting, hiring and transportation of migrant workers was done in the capacity of middlemen between the workers and growers or for their own operations.

Migrant workers are not employed in the processing or packing operations of a packing shed operator. They are employed to harvest and haul crops. However, Congress clearly intended the section 3(b)(2) exclusion to apply, under certain circumstances, to packing shed operators who employ migrant workers for their own operation. Were the Court to conclude that the “operation” of a packing shed operator for purposes of section 3(b)(2) is confined to the processing and packing operations, the exclusion would be rendered meaningless. Further, such an interpretation would disregard the realities of the operation of a packing shed business. Instead, the Court must determine whether the hiring in a particular case is done for harvesting that is part of the packing shed operator’s own operation or for harvesting that is done by the grower, using the packing shed operator as a middleman to supply migrant workers.

The Secretary of Labor relies on 29 C.F.R. § 41.17 , which reads in part as follows:

The regulation adds nothing to the Court’s consideration of the problem in these areas. The first sentence is superfluous, because if the processor had purchased the crops prior to harvest he would be a farmer engaged in hiring migrant workers for his own harvesting operation and clearly entitled to the section 3(b)(2) exclusion. The second sentence merely restates the problem of whether the processor is in fact acting as “a conduit through whom the migrant workers are made available to third parties,” and notes that a processor may be a “conduit” even when the crops are the subject of a contract to purchase (although he could not be where the crops are the subject of a contract of sale). The regulation does not state that title to the crops at the time of harvest is determinative of the section 3(b)(2) issue. To the extent that it could be so interpreted, it has been explicitly disapproved by Congress:

The “economic realities of agricultural production and processing” include a wide range of circumstances, among them considerations of economy of operation, competitive influences, financial risks, and the prevalent practices in a given agricultural community. No one of these considerations should be determinative in itself, but they are guideposts to be used in determining whether a given operator’s hiring of migrant workers is done for his own operation or as a middleman. The Court turns now to a consideration of the economic realities of each of the defendants’ operations.

A. Paramount Citrus Association

The stipulated facts in No. 76-1544 include the following:

The facts demonstrate that Paramount Citrus is a packing shed operator that employs migrant agricultural workers to harvest crops that it has contracted to harvest, pack and sell. It harvests only those crops that it has contracted to pack or process in its own plants. It is customary in the region in which Paramount Citrus operates for a packing shed operator to harvest the citrus fruit that it processes and packs. Paramount Citrus does not supply migrant workers to any other employer. On the basis of these facts, the Court concludes that Paramount Citrus engages in the recruiting, hiring and transportation of migrant workers “solely for [its] own operation.”

B. Santa Clara Produce, Inc.

The stipulated facts in No. 77-1898 include the following:

The Court finds that Santa Clara Produce is a packing shed operator that employs' migrant agricultural workers to harvest crops that it has contracted to harvest, pack and sell. Santa Clara Produce appears to harvest only those crops that it has contracted to pack and sell. It exerts substantial control over the planting and care of the crops, and it completely controls the harvesting process itself. Santa Clara Produce bears the risk of any loss incurred after the crops are harvested. The Court concludes that Santa Clara Produce engages in the recruiting, hiring and transportation of migrant workers “solely for [its] own operation.”

3. Conclusion

Paramount Citrus and Santa Clara Produce are ongoing concerns that employ migrant workers to harvest and haul crops that the companies have contracted to harvest, process, pack and sell. They are not the kind of middlemen between migrant workers and agricultural operators that Congress intended to regulate. Paramount Citrus and Santa Clara Produce are not “farm labor contractors” within the meaning of section 3(b)(2) of the FLORA and are therefore not subject to the registration requirements of section 4 of that act.

The foregoing will be considered findings of fact and conclusions of law. Judgment will be entered in favor of the defendants in No. 76-1544-WMB and No. 77-1898-WMB.