WASHINGTON, DC - The U.S. Department of Agriculture (USDA) continues its efforts to enforce the Perishable Agricultural Commodities Act (PACA) and ensure fair trading practices within the U.S. produce industry. Recently, the USDA imposed sanctions on two produce businesses: Lau Enterprises II Inc., operating out of Miami Lakes, Florida, and Loreas Fresh Produce Inc., operating out of Pharr, Texas.
The companies allegedly failed to meet their contractual obligations to the sellers of produce they purchased and failed to pay reparation awards which, combined, amount to $11,402.
Direct from the USDA Agricultural Marketing Service:
The following businesses and individuals are currently restricted from operating in the produce industry:
- Lau Enterprises II Inc., operating out of Miami Lakes, Florida, for failing to pay a $7,132 award in favor of a Honduras seller. As of the issuance date of the reparation order, Leonardo Gonzalez was listed as the Officer, Director, and/or Major Stockholder of the business.
- Loreas Fresh Produce Inc., operating out of Pharr, Texas, for failing to pay a $4,270 award in favor of a Texas seller. As of the issuance date of the reparation order, Rolando Loera Mendoza was listed as the Officer, Director, and/or Major Stockholder of the business.
PACA provides an administrative forum to handle disputes involving produce transactions; this may result in the USDA’s issuance of a reparation order that requires damages to be paid by those not meeting their contractual obligations in buying and selling fresh and frozen fruits and vegetables. The USDA is required to suspend the license or impose sanctions on an unlicensed business that fails to pay PACA reparations awarded against it as well as impose restrictions against those principals determined to be responsibly connected to the business when the order is issued. Those individuals, including sole proprietors, partners, members, managers, officers, directors, or major stockholders, may not be employed by or affiliated with any PACA licensee without USDA approval.
The PACA Division, which is in the Fair Trade Practices Program in the Agricultural Marketing Service, regulates fair trading practices of produce businesses that are operating subject to PACA, including buyers, sellers, commission merchants, dealers, and brokers within the fruit and vegetable industry.
In the past three years, the USDA resolved approximately 3,500 PACA claims involving more than $58 million. PACA staff also assisted more than 7,800 callers with issues valued at approximately $148 million. These are just two examples of how the USDA continues to support the fruit and vegetable industry.
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