Release No.: 112-15
WASHINGTON, Oct. 13, 2015 – 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:
- Stea Bros. Inc., operating out of Philadelphia, Pa., for failing to pay an $117,027 award in favor of a California seller. As of the issuance date of the reparation order, Frank Stea was listed as the officer, director, and major stockholder of the business. He has challenged his responsibly connected status.
- New World Wholesale Inc., operating out of Jessup, Md., for failing to pay a $5,620 award in favor of a Texas seller. As of the issuance date of the reparation order, Sang S. Kim was listed as the officer, director, and major stockholder of the business.
Lanes Consulting Firm LLC, doing business as Rocco’s Produce, operating out of Wheat Ridge, Colo., for failing to pay a $97,897 award in favor of an Indiana seller. As of the issuance date of the reparation order, Jacob Howes was listed as a member 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 Agricultural Marketing Service (AMS), PACA Division, regulates fair trading practices of produce businesses operating subject to PACA, which includes buyers, sellers, commission merchants, dealers, and brokers within the fruit and vegetable industry. All oversight of actions related to PACA are conducted by AMS, an agency within USDA.
In the past three years, USDA resolved approximately 4,250 PACA claims involving more than $77 million. Our experts also assisted more than 7,000 callers with issues valued at approximately $110 million. These are just two examples of how 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 PACAdispute@ams.usda.gov regarding this matter.
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