As part of its efforts to enforce the Perishable Agricultural Commodities Act (PACA) and ensure fair trading practices within the U.S. produce industry, the Department of Agriculture (USDA) has imposed sanctions on four produce businesses for failing to meet their contractual obligations to the sellers from whom they purchased produce and failing to pay reparation awards issued under the PACA. 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. 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 following businesses and individuals are currently restricted from operating in the produce industry:
- Star Gold Produce Corporation, operating out of Los Angeles, Calif., for failing to pay a $201,035 award in favor of an Arizona seller. As of the issuance date of the reparation order, Alicia Palacios was listed as the officer, director and/or major stockholder of the business.
- Wayne Bailey Produce Company LLC, operating out of Chadbourn, N.C., for failing to pay a $56,400 award in favor of a North Carolina seller. As of the issuance date of the reparation order, Alice Wooten was listed as a member or manager of the business. She has challenged her responsibly connected status.
- Champions Produce LLC, operating out of Spring, Texas, for failing to pay a $192,274 award in favor of a Florida seller. As of the issuance date of the reparation order, Christopher Petro and Michael Petro were listed as members or managers of the business.
- RR & Tequila Limes LLC BB #:287901, operating out of McAllen, Texas, for failing to pay an $11,600 award in favor of a Texas seller. As of the issuance date of the reparation order, Victor Rivera was listed a member or manager 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.
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 3,500 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 USDA continues to support the fruit and vegetable industry.
For more information regarding this matter, contact John Koller, Chief, Dispute Resolution Branch, at (202) 720-2890, by fax at (202) 690-2815, or by email at PACAdispute@usda.gov regarding this matter.
Release No.: 019-20