Arizona Produce Company Resolves Issues With USDA

By Terri Jo Neff

One Arizona produce company has resolved a reparation order issued last year by the U.S. Department of Agriculture (USDA) in favor of a seller, while two other companies have yet to make payment.

According to the USDA, Rio Rico-based Lorex Produce LLC has satisfied a $48,826 reparation order issued under the Perishable Agricultural Commodities Act (PACA) in February 2020 involving unpaid produce transactions with a Florida seller. As a result, Lorex Produce can continue operating in the produce industry upon applying for and being issued a license under PACA.

In addition, company officials Francisco Alejandro Lopez Rodriguez and Enok Aristiga Ayala may now be employed by or affiliated with any PACA licensee.

The USDA’s PACA Division is part of the Fair Trade Practices Program in the Agricultural Marketing Service. It provides an options for handling disputes involving contractual obligations in the buying and selling of fresh and frozen fruits and vegetables produce transactions.

The USDA is authorized to suspend a PACA license -or impose sanctions on an unlicensed business- for failure to pay a reparations award. The agency can also prohibit sole proprietors, partners, members, managers, officers, directors or major stockholders of any sanctioned company from being employed by or affiliated with any PACA licensee without securing USDA approval.

Last week’s announcement that Lorex Produce has fully satisfied its PACA order leaves two other Arizona companies on the reparation list.

Perfect Harvest Inc., operating in Nogales, was sanctioned last year for failing to pay a $243,240 reparation award in favor of an in-state seller. As of the issuance date of the order, Jorge A. Mercado was listed as the officer, director and major stockholder of the business. He may not be employed by or affiliated with any PACA licensee without securing USDA approval.

The other company, Arizona Lemons LLC, operated out of Phoenix. It is the subject of a $16,776 reparation award in favor of a Minnesota seller who was not paid. Company officials Martha E. Bombela and Jose R. Partida may not be employed by or affiliated with any PACA licensee without securing USDA approval.

When the USDA announced its sanctions against Lorex Produce last year, the agency noted it “continues to enforce the prompt and full payment for produce while protecting the rights of sellers and buyers in the marketplace.” In the past three years, more than 3,600 claims were resolved involving more than $104 million.