WASHINGTON, DC – 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).

According to a USDA press release, the following businesses and individuals are currently restricted from operating in the produce industry:

• Tomato Specialties LLC, operating out of Nogales, AZ, for failing to pay a $4,200 award in favor of a Texas seller. As of the issuance date of the reparation order, Isaac Castro and Yvette Castro were listed as members of the business.
• Shorty’s Produce Inc., operating out of Denver, CO, for failing to pay a $119,808 award in favor of a California seller. As of the issuance date of the reparation order, Eleno Cardenas was listed as the Officer, Director, and major stockholder of the business.
• PP'S Produce Distributors LLC, operating out of Dallas, TX, for failing to pay an $8,809 award in favor of a Texas seller. As of the issuance date of the reparation order, Jose Abud and Daniel Esqueda were listed as members of the business.

PACA provides an administrative forum to handle disputes involving 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. 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 part of USDA’s 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 3,400 PACA claims involving more than $58 million. PACA staff also assisted more than 8,000 callers with issues valued at approximately $151 million. These are just two examples of how USDA continues to support the fruit and vegetable industry.

USDA's Agricultural Marketing Services