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Agriculture Decisions AGRICULTURE DECISIONS Volume 57 July - December 1998 Part Three (PACA) Pages 1458- 1750 THIS IS A COMPILATION OF DECISIONS ISSUED BY THE SECRETARY OF AGRICULTURE AND THE COURTS PERTAINING TO STATUTES ADMINISTERED BY THE UNITED STATES DEPARTMENT OF AGRICULTURE AGRICULTURE DECISIONS AGRICULTUREDECISIONS is an official publication by the Secretary of Agriculture consisting of decisions and orders issued in formal adjudicatory administrative proceedings conducted for the Department under various statues and regulations pursuant to the Administrative Procedure Act. Selected court decisions concerning the Department's regulatory programs are also included. The Department is required to publish its rules and regulations in the Federal Register and, therefore, they are not included in AGRICULTUREDECISIONS. Beginning in 1989, AGRICULTUREDECISIONSis comprised of three Parts, each of which is published every six months. Part One is organized alphabetically by statute and contains all decisions and orders other than those pertaining to the Packers and Stockyards Act and the Perishable Agricultural Commodities Act, which are contained in Parts Two and Three, respectively. The published decisions and orders may be cited by giving the volume number, page number and year, e.g., 1 Agric. Dec. 472 (1942). It is unnecessary to cite a decision's docket or decision numbers, e.g., D-578; S. 1150, and the use of such references generally indicates that the decision has not been published in AGRICULTUREDECISIONS. Consent Decisions entered subsequent to December 31, 1986, are no longer published. However, a list of the decisions is included. The decisions are on file and may be inspected upon request made to the Hearing Clerk, Office of Administrative Law Judges. Direct all inquiries regarding this publication to: Editors, Agriculture Decisions, Hearing Clerk Unit, Office of Administrative Law Judges, U.S. Department of Agriculture, Room 1081 South Building, Washington, D.C. 20250-9200, Telephone: (202) 720-4443. LIST OF DECISIONS REPORTED JULY - DECEMBER 1998 PERISHABLE AGRICULTURAL COMMODITIES ACT COURT DECISIONS ANDERSHOCK'S FRUITLAND, INC., ET AL. V. USDA. NO. 96-4238 ................................................. 1458 STEVEN J. RODGERS V. USDA. NO. 98-1057. ................................................ 1464 MICHAEL NORINSBERG V. USDA. No. 98-1065 ................................................. 1465 DEPARTMENTAL DECISIONS ! LAWRENCE D. SALINS. PACA-APP Docket No. 96-0010. Decision and Order ........................................... 1474 COLONIAL PRODUCE ENTERPRISES, INC. PACA Docket No. D-95-0534. Decision and Order ........................................... 1498 JOSEPH T. KOCOT. PACA-APP Docket No. 97-0006. Decision and Order ........................................... 1517 LIMECO, INC. PACA Docket No. D-97-0017. Decision and Order ........................................... 1548 LIMECO, INC. PACA Docket No. D-97-0017. StayOrder .................................................. 1577 WESTERN SIERRA PACKERS, INC. PACA Docket No. D-97-0004. Decision and Order ........................................... 1578 MICHAEL J. MENDENHALL. PACA-APP Docket No. 97-0008. Decision and Order ........................................... 1607 STEVEN J. RODGERS. PACA-APP Docket No. 96-0002. Order Lifting Stay ............................................ 1649 REPARATION DECISIONS MESA PRODUCE, INC. V. ROMNEY & ASSOCIATES, INC., ET AL. PACA DOCKET NO. R-97-0144 Decision and Order ........................................... 165 I ALGER FARMS, INC. V. JACKIE D. FOSTER. PACA Docket No. R-98-0045. Decision and Order ........................................... 1655 ROMNEY & ASSOCIATES, INC. V. SUPER FRESH, INC. PACA Docket No. R-98-0071. Decision and Order ........................................... 1670 ROMNEY & ASSOCIATES, INC. V. SUPER FRESH, INC. PACA Docket No. R-98-0071. Order on Reconsideration ...................................... 1683 PREMIUM VALLEY PRODUCE, INC. V. SAM WANG FOOD CORP., INC. PACA Docket No. R-98-0153. Decision and Order ........................................... 1684 ii THE CHUCK OLSEN CO. V. PRODUCE DISTRIBUTORS INC., ET AL. PACA Docket No. R-98-0083. Decision and Order ........................................... 1689 FRIEDRICH ENTERPRISES, INC., ET AL. V. BENNY'S FARM FRESH DISTRIB. PACA Docket No. R-98-0134. Decision and Order ........................................... 1695 MISCELLANEOUS ORDERS QUEEN CITY FARMS, INC. PACA Docket No. D-97-0020. Order Denying Petition for Reconsideration and Reopening Hearing ....................................... 1704 JSG TRADING CORP., GLORIA AND TONY ENTERPRISES, ET AL. PACA Docket No. D-94-0508. PACA Docket No. D-94-0526. Stay Order .................................................. 1715 TOLAR FARMS AND/OR TOLAR SALES, INC. PACA Docket No. D-96-0530. Order Lifting Stay ............................................ 1717 TOLAR FARMS AND/OR TOLAR SALES, INC. PACA Docket No. D-96-0530. Order Denying Request for Stay ................................. 1719 TOLAR FARMS AND/OR TOLAR SALES, INC. PACA Docket No. D-96-0530. Order Granting Stay ........................................... 1721 H. SCHNELL 8¢ COMPANY, INC. PACA Docket No. D-97-0024. Remand Order ............................................... 1722 iii DEFAULT DECISIONS BOBBYE. ROBERTSON,D/B/ABOBBYROBERTSONPRODUCE. PACA Docket No. D-98-0009. Decision and Order ........................................... ! 732 STEPHENWERNER. PACA Docket No. D-98-0022. Declston and Order ........................................... 1733 FARM FRESHPRODUCE,INC. PACA Docket No. D-97-0010. Decision and Order ........................................... 1736 DAVID FISHGOLD,INC. PACA Docket No. D-97-0025. Decision and Order ........................................... 1739 ADAMSPRODUCE,INC. PACA Docket No. D-98-0016. Decision and Order ........................................... 1740 ROMNEY& ASSOC., INC., A/T/A R&R DISTRIBUTING. PACA Docket No. D-98-0007. Declston and Order ........................................... 1742 GROCERYIMPORT& EXPORTINTERNATIONALCORP., ETAL. PACA Docket No. D-97-0032. Decision and Order ........................................... !744 JAMESO'SULLIVAN D/B/AH&M PRODUCE. PACA Docket No. D-98-0006. Decision and Order ........................................... 1746 SANFORDPRODUCEEXCHANGE,INC. PACA Docket No. D-98-0012. Decision and Order ........................................... 1748 Consent Decisions ........................................... 1750 iv 1458 PERISHABLE AGRICULTURAL COMMODITIES ACT COURT DECISIONS ANDERSHOCK'S FRUITLAND, INC., AND JAMES A. ANDERSHOCK v. UNITED STATES DEPARTMENT OF AGRICULTURE. No. 96-4238. Decided August 10, 1998. (Cite as 151 F.3d 735) Perishable agricultural commodities -- Failure to pay -- Sanction -- License revocation. The UnitedStatesCourtof AppealsfortheSeventhCircuitheldthatthe JudicialOfficer'srevocationofthe license of adealerregulatedunderthe PerishableAgriculturalCommoditiesAct (PACA)forrepeated failuresto payforproduceoveranextendedperiodof time,was proper.Thecourtstatedthatrelevanceis amatterofsubstantivepolicyandthat itiswithin the agency'spowertodecidethatthereasonsforaPACA licensee's repeatedfailuresto pay forproducearenotrelevant to sanction. United States Court of Appeals Seventh Circuit Before FLAUM, EASTERBROOK, and KANNE, Circuit Judges. EASTERBROOK, Circuit Judge. Dealers regulated by the Perishable Agricultural Commodities Act must "truly and correctly . account and make full payment promptly in respect of any transaction". 7 U.S.C. § 499b(4). The Secretary of Agriculture has defined "promptly" as "within 10 days after the day on which the produce is accepted". 7 C.F.R. § 46.2(aa)(5). Section 8(a) of the PACA, 7 U.S.C. § 499h(a), authorizes the Secretary to revoke the license of any dealer who commits "flagrant or repeated" violations of § 499b. Between May 1994 and May 1995 Andershock's Fruitland failed to pay the agreed purchase prices of 113 lots of agricultural commodities, a total of more than $245,000. It did not finish paying these sums until 1997, almost a year after the administrative hearing, and the bulk of repayment was accomplished by giving Thomas Produce, its biggest creditor, an equity interest in the dealership in lieu of cash. The Secretary revoked its license under the Department's rule that "repeated failures to pay a substantial amount of money over an extended period of time" lead to revocation rather than a lesser sanction. Caito Produce Co., 48 Agric. Dec. 602, 611-13 (1989). ANDERSHOCK'FRUITS LANDINC... et al. v. USDA 1459 57Agric.Dec. 1458 Andershock's Fruitland argued in the administrative proceedings that revocation of its license would be an excessive sanction because nonpayment was attributable to its inability to collect from some of its own customers, rather than to an effort to exploit its suppliers. It contended that for the decade before it encountered cash-flow problems it had been a model dealer. The administrative law judge thought that these were mitigating circumstances and gave Andershock's Fruitland a year from the date of his decision to cover the debt; if it did so, there would be no sanction, but otherwise its license would be revoked. This effectively allowed Andershock's Fruitland to withhold payment for two and a half years (the earliest debts arose in May 1994, and a year from the ALJ's decision was mid-December 1996). The Judicial Officer of the Department of Agriculture, acting as the Secretary's delegate, thought this incompatible with
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