The U.S. Department of Agriculture has imposed sanctions on four produce businesses for failing to meet contractual obligations to the sellers of produce they purchased and failing to pay reparation awards issued under the Perishable Agricultural Commodities Act. These sanctions 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.
The following businesses and individuals are currently restricted from operating in the produce industry:
- Poblano Fresh Produce Corp., operating out of Los Angeles, Calif., for failing to pay a $230,918 award in favor of a California seller. As of the issuance date of the reparation order, Eliborio Ramirez was listed as the officer, director and major stockholder of the business.
- Maya Fruit Corporation Inc., operating out of Miami Lakes, Fla., for failing to pay an $18,972 award in favor of a Texas seller. As of the issuance date of the reparation order, Richard Vega was listed as the officer, director and major stockholder of the business.
- Suncrest Produce Solutions, operating out of Winter Haven, Fla., for failing to pay a $26,650 award in favor of a Virginia seller. As of the issuance date of the reparation order, Jason Turner was listed as the sole principal of the business.
- Terrys Supermarket #7 LLC, operating out of Lewisville, Texas, for failing to pay a $10,802 award in favor of a Texas seller. As of the issuance date of the reparation order, Kun W. Yu was listed as a member of the business.
USDA files administrative complaint against Oregon company
The USDA has also filed an administrative complaint against North Pacific Canners and Packers Inc., doing business as NORPAC Foods Inc. for alleged violations of the Perishable Agricultural Commodities Act. The company, operating from Oregon, allegedly failed to make payment promptly to 145 produce sellers and creditors in the amount of $19,128,784 from June 2019 through January 2020.
NORPAC will have an opportunity to request a hearing. Should USDA find that the company committed repeated and flagrant violations, it would be barred from the produce industry as a licensee for three years, or two years with the posting of a USDA-approved surety bond. Furthermore, its principals could not be employed by or affiliated with any PACA licensee for two years, or one year with the posting of a USDA-approved surety bond.
What is PACA?
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.
Click here for an overview of companies who previously violated PACA.