WASHINGTON, DC - Recently, the United States Department of Agriculture (USDA) imposed sanctions on two produce businesses based out of New Jersey and Texas for allegedly failing to meet contractual obligations to the sellers of produce they purchased. Additionally, the businesses failed to pay reparation awards totaling $72,401 issued under the Perishable Agricultural Commodities Act (PACA).
The sanctions imposed by the USDA include suspending the businesses’ PACA licenses and barring the principal operators of the businesses 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:
- PHP Group, operating out of Saddle River, New Jersey, for failing to pay a $37,841 award in favor of a Texas seller. As of the issuance date of the reparation order, Pedro H. Perez was listed as a member of the business
- LR Imports, operating out of Houston, Texas, for failing to pay a $34,560 award in favor of a California seller. As of the issuance date of the reparation order, Martin Luna and Luis E. Ramirez were listed as the officers, directors, and/or major stockholders 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.
To read the release in its entirety, click here.
