Freshko Produce Services, Inc. v. ILA Products, Inc.

District Court, E.D. California·Decided September 3, 2021·No. 1:19-cv-00017·Unknown

Opinion

1 2 3 4 5 6 7 10 11 FRESHKO PRODUCE SERVICES, INC., No. 1:19-cv-00017-DAD-BAM 12 Plaintiff, 13 v. ORDER GRANTING PLAINTIFF’S MOTION FOR ATTORNEYS’ FEES 14 ILA PRODUCTS, INC., et al., (Doc. No. 70) 15 Defendants.

16 17 This matter is before the court on plaintiff Freshko Produce Services, Inc.’s motion for 18 attorneys’ fees. (Doc. No. 70.) Pursuant to General Order No. 617 addressing the public health 19 emergency posed by the coronavirus pandemic, on May 24, 2021, the court took this matter under 20 submission to be decided on the papers. (Doc. No. 71.) Having considered the briefing, the court 21 will grant plaintiff’s motion for attorneys’ fees. 23 Plaintiff filed this action on January 4, 2019 against defendants ILA Products, Inc. 24 (“ILA”) and HFN CA, Inc. (“HFN”) (collectively “the corporate defendants”) and defendants 25 Jamie Gibson and Kathy Gibson for claims stemming from a series of transactions for the sale of 26 perishable agricultural commodities on credit pursuant to a written credit application (the “Credit 27 Application”) arising under the Perishable Agricultural Commodities Act, 7 U.S.C. § 499a et seq., 28 (“PACA”) and other related claims. (Doc. No. 1 at ¶¶ 13–39, 49–59.) Defendants failed to 1 timely respond to the complaint and the Clerk of the Court therefore entered default against them 2 on February 21, 2019. (Doc. No. 13.) Additional pertinent details of the procedural record may 3 be found in the court’s May 14, 2021 order and will not be repeated herein. (Doc. No. 68.) 4 Plaintiff filed a motion for entry of judgment as to the corporate defendants on December 5 10, 2020. (Doc. No. 67.) Attached to the motion were the parties’ stipulated requests to dismiss 6 defendant Kathy Gibson pursuant to Federal Rule of Civil Procedure 41(a)(1)(A)(ii) and for the 7 entry of judgment in favor of plaintiff and against defendant Jamie Gibson in the amount of 8 $181,674.72. (Doc. Nos. 67-3, 67-4.) 9 On May 14, 2021, the court entered an order of default judgment as to the corporate 10 defendants. (Doc. No. 68.) Therein, pursuant to the parties’ settlement agreement and finding 11 good cause, the court also granted the parties’ stipulated request to dismiss defendant Kathy 12 Gibson from this action without prejudice pursuant to Rule 41(a)(1)(A)(ii) and to enter judgment 13 in favor of plaintiff and against defendant Jamie Gibson. (Id.) The court then directed plaintiff to 14 file any motion for attorneys’ fees to recover fees incurred in this action within twenty-eight (28) 15 days from entry of judgment in accordance with the terms of the parties’ settlement agreement. 16 (Id. at 9.) 17 Plaintiff did so on May 21, 2021. (Doc. No. 70.) No opposition was filed, and on July 7, 18 2021, plaintiff filed its reply. (Doc. No. 72.) 20 “Congress enacted PACA in 1930 to promote fair trading practices in the produce 21 industry.” Tanimura & Antle, Inc. v. Packed Fresh Produce, Inc., 222 F.3d 132, 135 (3d Cir. 22 2000). PACA had the intent of “preventing unfair business practices and promoting financial 23 responsibility in the fresh fruit and produce industry.” Farley and Calfree, Inc. v. United States 24 Dep't of Agric., 941 F.2d 964, 966 (9th Cir. 1991). “Dealers violate PACA if they do not pay 25 promptly and in full for any perishable commodity in interstate commerce.” 7 U.S.C. § 499b(4); 26 Sunkist Growers, Inc. v. Fisher, 104 F.3d 280, 282 (9th Cir. 1997). 27 ///// 28 ///// 1 In particular, “perishable agricultural commodities, inventories of food or other derivative 2 products, and any receivables or proceeds from the sale of such commodities or products, are to 3 be held in a non-segregated floating trust for the benefit of unpair sellers.” Tanimura & Antle, 4 Inc., 222 F.3d at 136; see also 7 U.S.C. § 499e(c)(2). Any failure to “make full payment 5 promptly” in respect to a transaction is unlawful pursuant to 7 U.S.C. § 499b(4), and any 6 violation of § 499b subjects the buyer to liability for any damages caused by the violation. 7 7 U.S.C. § 499e(a). 8 “Although an express statutory basis for attorneys’ fees does not exist under PACA, the 9 Ninth Circuit has found attorneys’ fees proper when an enforceable contract exists giving the 10 [PACA claimant] a right to attorneys’ fees.” Chong’s Produce, Inc. v. Pushpak Rest. Inc., No. 11 15-cv-04923-HRL, 2017 WL 990585, at *4 (N.D. Cal. Feb. 27, 2017). PACA provides in the 12 relevant part: 13 Perishable agricultural commodities received by a commission merchant, dealer, or broker in all transactions, and all inventories of 14 food or other products derived from perishable agricultural commodities, and any receivables or proceeds from the sale of such 15 commodities or products, shall be held by such commission merchant, dealer, or broker in trust for the benefit of all unpaid 16 suppliers or sellers of such commodities or agents involved in the transaction, until full payment of the sums owing in connection with 17 such transactions has been received by such unpaid suppliers, sellers, or agents. Payment shall not be considered to have been 18 made if the supplier, seller, or agent receives a payment instrument which is dishonored. 19 20 7 U.S.C. § 499e(c)(2) (emphasis added.) The Ninth Circuit has interpreted the emphasized 21 provision as allowing for the recovery of contractually due reasonable attorneys’ fees and costs. 22 Middle Mountain Land & Produce Inc. v. Sound Commodities Inc., 307 F.3d 1220, 1223 (9th Cir. 23 2002) (“A fair reading of the statute brings contractually due attorneys’ fees and interest within 24 the scope of the statute’s protection of ‘full payment owing in connection with the [perishable 25 agricultural commodities] transaction.’”) Thus, where a valid contract exists, which contains an 26 express provision providing for the payment of attorneys’ fees incurred in collecting sums due 27 pursuant to its terms in a PACA case, it is enforceable. See Chong’s Produce, Inc., 2017 WL 28 990585, at *4; Church Bros. v. Garden of Eden Produce, LLC, No. 5:11-cv-04114 EJD, 2012 WL 1 1155656, at *3 (N.D. Cal. Apr. 5, 2012) (awarding attorneys’ fees in PACA claim pursuant to 2 parties’ contract); Sequoia Sales, Inc. v. P.Y. Produce, LLC, No. CV 10-5757 CW (NJV), 2011 3 WL 3607242, at *7 (N.D. Cal. July 29, 2011). 4 A district court also “has discretion to award reasonable prejudgment interest to a PACA 5 claimant when there is not a contract between the parties, if such award is necessary to promote 6 the interest of the claimant.” Prime Time Sales, LLC v. Glob. Fresh Produce, LLC, No. 1:20-cv- 7 0229-DAD-JLT, 2020 WL 3605617, at *6 (E.D. Cal. July 2, 2020), report and recommendation 8 adopted, No. 1:20-cv-00229-DAD-JLT, 2020 WL 4607284 (E.D. Cal. Aug. 11, 2020) (citing 9 Middle Mountain Land, 307 F.3d at 1225–26).

Free access — add to your briefcase to read the full text and ask questions with AI

Freshko Produce Services, Inc. v. ILA Products, Inc., (E.D. Cal. 2021).

Freshko Produce Services, Inc. v. ILA Products, Inc. (Freshko Produce Services, Inc. v. ILA Products, Inc.) — published by Counsel Stack Legal Research, free access to 12M+ legal documents.

Related

Hensley v. Eckerhart
461 U.S. 424 (Supreme Court, 1983)
City of Burlington v. Dague
505 U.S. 557 (Supreme Court, 1992)
Rouse v. Law Offices of Rory Clark
603 F.3d 699 (Ninth Circuit, 2010)
Marx v. General Revenue Corp.
133 S. Ct. 1166 (Supreme Court, 2013)
Tahara v. Matson Terminals, Inc.
511 F.3d 950 (Ninth Circuit, 2007)
Moreno v. City of Sacramento
534 F.3d 1106 (Ninth Circuit, 2008)
Crawford v. Astrue
586 F.3d 1142 (Ninth Circuit, 2009)
Camacho v. Bridgeport Financial, Inc.
523 F.3d 973 (Ninth Circuit, 2008)
Ballen v. City of Redmond
466 F.3d 736 (Ninth Circuit, 2006)
Caudle v. Bristow Optical Co.
224 F.3d 1014 (Ninth Circuit, 2000)
Barbosa v. Cargill Meat Solutions Corp.
297 F.R.D. 431 (E.D. California, 2013)
Kerr v. Screen Extras Guild, Inc.
526 F.2d 67 (Ninth Circuit, 1975)