USDA Restricts PACA Violators in California, Maryland, and North Carolina from Operating in the Produce Industry
- by Jenna Plasterer
WASHINGTON, DC - The U.S. Department of Agriculture (USDA) has announced that it has imposed sanctions on four produce businesses for failing to meet contractual obligations to sellers of produce they purchased from, as well as failing to pay reparation awards issued under the Perishable Agricultural Commodities Act (PACA). In total, the four businesses operating out of California, Maryland, and North Carolina failed to pay sellers in the amount of $175,717. The USDA sanctions include suspending the companies' PACA licenses and barring the principal operators of each business from engaging in PACA-licensed business or other activities without approval from USDA
Direct From the USDA Agricultural Marketing Service:
The following businesses and individuals are currently restricted from operating in the produce industry:
- California Fresh Citrus Company, operating out of Porterville, Calif., for failing to pay a $40,000 award in favor of a California seller. As of the issuance date of the reparation order, Vincent H. Lobue and Christine C. Lobue were listed as the officers, directors, and/or major stockholders of the business
- Espirit Trading Inc., operating out of Vernon, Calif., for failing to pay a $26,990 award in favor of a California seller. As of the issuance date of the reparation order, Lin Calin was listed as the officer, director ,and major stockholder of the business
- Los Fuertes Produce LLC, operating out of Elkridge, Md., for failing to pay a $37,322 award in favor of a Pennsylvania seller. As of the issuance date of the reparation order, Jose A. Ramirez and Aracely Ortiz were listed as members of the business
- First Fruits Holdings LLC, operating out of Wake Forest, N.C., for failing to pay a $71,405 award in favor of an Idaho seller. As of the issuance date of the reparation order, John T. Fowler, Mark H. Black and Sean P. Swanson were listed as managers of the business
PACA provides an administrative forum to handle disputes involving produce transactions; this may result in 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. 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.
By issuing these penalties, USDA continues to enforce the prompt and full payment for produce while protecting the rights of sellers and buyers in the marketplace.
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, USDA resolved approximately 3,625 PACA claims involving more than $104 million. PACA staff also assisted more than 7,600 callers with issues valued at approximately $166 million. These are just two examples of how USDA continues to support the fruit and vegetable industry.
To read the release in its entirety, click here.