Sanctions include license suspensions and operational restrictions for principal operators to uphold fair trading practices in the produce industry.
The U.S. Department of Agriculture (USDA) has taken decisive action against four produce businesses for failing to fulfill contractual obligations and not paying reparation awards mandated by the Perishable Agricultural Commodities Act (PACA). These businesses face severe sanctions, including the suspension of their PACA licenses and restrictions on their principal operators from engaging in PACA-licensed activities without USDA approval.
The businesses affected by these sanctions are Marlon Abarca, doing business as New Water Co., based in Rancho Cucamonga, California, J. Mendez Produce Inc. from Los Angeles, California, Global Import With MK LLC in Atlanta, Georgia, and Bonimex Produce NYC Corp. located in Woodside, New York. Each of these businesses failed to pay reparation awards to their respective sellers, leading to the enforcement of penalties by the USDA.
Marlon Abarca’s New Water Co. was penalized for not paying a $13,248 award to a seller in Texas. At the time of the reparation order, Marlon Abarca was listed as the sole proprietor of the business. Similarly, J. Mendez Produce Inc., with Jose Mendez as the sole officer, director, and stockholder, failed to pay a $2,000 award to a California seller. Global Import With MK LLC, operated solely by Mikael Fede, did not pay a $36,032 award to a Texas seller. Lastly, Bonimex Produce NYC Corp., run by Rene Cortes Alonso and David Alonso, was sanctioned for not paying a $1,536 award to a seller in New York.
PACA serves as an administrative forum to resolve disputes in the produce industry, often leading to reparation orders that mandate payment of damages by parties that do not meet their contractual obligations in the buying and selling of fresh and frozen fruits and vegetables. The USDA is mandated to suspend licenses or impose sanctions on businesses that fail to comply with these reparation orders, as well as to restrict principals connected to these businesses from participating in PACA-licensed activities without USDA approval. This includes individuals such as sole proprietors, partners, members, managers, officers, directors, or major stockholders.
As stated in the USDA press release, these sanctions are part of the USDA’s ongoing efforts to enforce prompt and full payment for produce, thus protecting the rights of sellers and buyers in the marketplace.
Over the past three years, the USDA has managed more than 2,340 cases involving disputes valued at $126.3 million and assisted over 5,600 callers with issues worth $146.7 million. This demonstrates the USDA’s commitment to supporting fair trading practices within the fruit and vegetable industry.
The PACA Division, part of the Fair Trade Practices Program within the Agricultural Marketing Service, regulates fair trading practices for produce businesses, including buyers, sellers, commission merchants, dealers, and brokers operating under PACA.
These recent actions underscore the USDA’s dedication to maintaining integrity and fairness in the produce industry by ensuring that businesses adhere to their contractual obligations and that reparation awards are paid in full.
