WASHINGTON, Oct. 12, 2011 – The U.S. Department of Agriculture (USDA) has imposed sanctions on three produce businesses for failure to pay reparation awards issued under the Perishable Agricultural Commodities Act (PACA).
The following businesses and individuals are currently restricted from operating in the produce industry:
- Smokey Mountain Produce LLC, operating out of Morristown, Tenn., for failing to pay a $91,336.67 award in favor of an Alabama seller. As of the issuance date of the reparation order, Randy E. Lintz and Raul O. Rangel were listed as the officers and major stockholders of the business. The principals have challenged their responsibly connected status.
- Vanguard Culinary Group LTD, operating out of Fayetteville, N.C., for failing to pay a $43,518.63 award in favor of a New Jersey seller. As of the issuance date of the reparation order, Charles G. Manis and Phillip R. Taylor were listed as the officers, directors, and stockholders of the business.
- 2000 Avondale Foods LLC, operating out of Durham, N.C., for failing to pay a $25,718.60 award in favor of a North Carolina seller. As of the issuance date of the reparation order, Eligio Pena was listed as the sole member of the business.
PACA provides for an administrative forum to handle disputes over produce transactions; this may result in a reparation order being issued 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 of a 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, officers, directors, or major stockholders may not be employed by or affiliated with any PACA licensee without USDA-approval.
The Agricultural Marketing Service (AMS), PACA Division, regulates fair trading practices of produce businesses operating subject to the PACA, which includes buyers, sellers, commission merchants, dealers, and brokers within the fruit and vegetable industry. All oversight of actions related to the PACA are conducted by the AMS, an agency within the USDA.
In fiscal year 2010, USDA resolved approximately 2,000 claims filed under the PACA involving $30 million. This is just one more way the USDA continues to support the fruit and vegetable industry.
For more information, contact John Koller, Chief, Dispute Resolution Branch at (202) 720-2890, by fax at (202) 690-2815, or by email at disputeresolutionsection@ams.usda.gov regarding this matter.
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