PACA Trust Litigation Alert
On July 10, 2012, AMK Foodservices, Inc. d/b/a Kaney Foods filed for Chapter 11 bankruptcy protection. In this case, the debtor recently filed a motion seeking to approve a PACA claims procedure. This motion is currently pending before the court, but no hearing date has been set yet.
Please check your A/R to see if this case affects you. If it does, please do not wait to assert your rights.
PACA Trust Litigation Alert
On July 17, 2012, a civil action was filed in Arizona against Rainbow Produce Company Incorporated in an effort to collect approximately $43,611.00 in an alleged PACA trust debt.
On July 13, 2012, a civil action was filed in California against G. R. Products LLC in an effort to collect approximately $112,212.00 in alleged PACA trust debt.
On July 9, 2012, a civil action was filed in Texas against Empire Produce USA LLC in an effort to collect approximately $124,366.00 in alleged PACA trust debt.
On July 6, 2012, a civil action was filed in California against South Bay Fresh, Inc. in an effort to collect approximately $48,600.00 in an alleged PACA trust debt.
On July 3, 2012, a civil action was filed in Michigan against Great Lakes Produce and Marketing LLC in an effort to collect approximately $26,400.00 in an alleged PACA trust debt.
Please check your A/R to see if these cases affect you. If they do, please do not wait to assert your rights.
The Packer quoted Jason Klinowski in its 7/12/2012 updated article announcing the entry of an Agreed Order Establishing a PACA Claims Procedure in the $50 million dollar Adams Produce bankruptcy case, which involves over $16 million in secured debt.
See: PACA Claims Due in Adams Produce Case
In this article, The Packer noted that: “Attorney Jason Klinowski, from Freeborn & Peters in Chicago, and Larry Meuers of Meuers Law Firm in Naples, Fla., represent produce companies seeking payment from Adams and were key players in the development of the plan. They worked with lawyers representing Adams, PNC Bank and other parties to resolve how the PACA claims should move forward.” Id.
The article also quoted Jason as saying: “Getting the PACA trust beneficiaries paid quickly was our No. 1 priority,” Klinowski said. “A lot of good attorneys worked through some tough issues … Having been intimately involved in that process, I can tell you that it is not only a solid work product but the best way to get the PACA trust beneficiaries paid quickly.” Id.
With the PACA Claims Procedure in place, here are some critical dates of interest:
|
EVENT |
DEADLINE |
|
Bankruptcy Proof of Claim Deadline |
July 6, 2012 |
|
PACA Proof of Claim Deadline: |
August 3, 2012 |
|
PACA Trust Asset Report Deadline: |
August 3, 2012 |
|
Deadline to Object to PACA Proofs of Claim: |
August 24, 2012 |
|
Deadline to Object to PACA Trust Asset Report: |
August 24, 2012 |
|
Deadline to Schedule Meet and Confer: |
August 31, 2012 |
|
Deadline to Meet and Confer: |
September 14, 2012 |
|
Deadline to Notify Debtor of Result of Meet and Confer Conferences: |
September 17, 2012 |
|
Deadline to file Meet and Confer Report: |
September 21, 2012 |
|
Deadline to Respond to Claim Objections: |
September 28, 2012 |
|
Deadline to File PACA Trust Distribution Report: |
October 5, 2012 |
|
Deadline to Object to PACA Trust Distribution Report: |
October 12, 2012 |
|
Deadline to Make First Interim Distribution: |
October 19, 2012 |
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Mediation Date for Disputed Claims and Disputed Assets: |
October __, 2012 |
|
Deadline to File Motion to Determine Disputed Claims and Assets |
December 7, 2012 |
Although the Court is set to establish a PACA Claims Procedure on July 9, 2012, the deadline to file all proofs of claim (PACA and non-PACA alike) is July 6, 2012. Importantly, any party that fails to file their proof of claim by July 6, 2012 will not be able to file their PACA proof of claim after the Court enters an approved order as the July 6, 2012 date is a statutory date. Please do not be confused.
ALL creditors must file a proof of claim on or before July 6, 2012.
In addition to meeting the July 6, 2012 deadline, the PACA creditors will be required to file a special PACA Proof of Claim as outlined in Judge Mitchell’s forthcoming order. Simply put, the PACA creditors need to be prepared to file two separate proofs of claim. Any PACA creditor who fails to file any one of the two proofs of claim runs the risk of having the Court deny its claim. Those familiar with this case can tell you that these dates are going to come fast. Please do not wait to assert your rights.
PACA Trust Litigation Alert
On June 27, 2012, a civil action was filed in Wisconsin against The Red Onion LLC in an effort to collect approximately $56,960.00 in an alleged PACA trust debt.
On June 21, 2012, a civil action was filed in New York against New Farm, Inc. in an effort to collect approximately $140,000.00 in alleged PACA trust debt.
On June 18, 2012, a civil action was filed in New York against Suffolk Banana Co., Inc., Long Island Banana Corp. and Long Island Banana in an effort to collect approximately $1,998,400.00 in alleged PACA trust debt.
On June 18, 2012, a civil action was filed in Idaho against Savory Sweet LLC in an effort to collect approximately $58,400.00 in an alleged PACA trust debt.
Please check your A/R to see if these cases affect you. If they do, please do not wait to assert your rights.