WASHINGTON, DC - Sanctions have been imposed on three produce businesses in California and Pennsylvania for failing to meet contractual obligations to the sellers of produce they purchased. According to the USDA, they also failed to pay reparation awards issued under the Perishable Agricultural Commodities Act (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 the USDA.

Direct from the USDA Agricultural Marketing Service: 

The following businesses and individuals are currently restricted from operating in the produce industry:

• Parimar Inc., doing business as D. DeFranco & Sons, operating out of Los Angeles, California, for failing to pay a $31,200 award in favor of a Florida seller. As of the issuance date of the reparation order, Gerald S. DeFranco, Paul F. DeFranco, and Richard J. DeFranco were listed as the officers, directors, and/or major stockholders of the business
• Hurst Produce Inc., operating out of Ephrata, Pennsylvania, for failing to pay a $19,767 award in favor of an Ohio seller. As of the issuance date of the reparation order, Matilde Baez was listed as the officer, director, and major stockholder of the business
• Frozen Food Development Inc., operating out of Lancaster, Pennsylvania, for failing to pay a $1,002,065 award in favor of a Florida seller. As of the issuance date of the reparation order, Gary H. Gregory was listed as the officer, director, and major stockholder 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.