Berti Produce - San Francisco, Inc. et al v. Sbragia et al

Filing 9

ORDER Case Management Statement due by 1/5/2012. Case Management Conference set for 1/12/2012 10:00 AM in Courtroom B, 15th Floor, San Francisco.. Signed by Judge Maria-Elena James on 10/21/2011. (cdnS, COURT STAFF) (Filed on 10/21/2011)

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MARION QUESENBERY, State Bar No. 72308
RYNN & JANOWSKY, LLP
P.O. Box 20799
Oakland, CA 94620
Telephone: [phone]
Facsimile: [phone]
E-mail: [e-mail]
Attorneys for Plaintiffs
Berti Produce – San Francisco, Inc.; Edwin Chin
dba New City Fruit & Produce; Jacobs, Malcolm & Burtt;
North Bay Produce, Inc.; Washington Vegetable Company;
What A Tomato Produce Company, Inc.; and Coosemans
San Francisco, Inc.

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IN THE UNITED STATES DISTRICT COURT

LAW OFFICES
RYNN & JANOWSKY, LLP
P.O. BOX 20799
OAKLAND, CALIFORNIA 94620
[phone]
FAX [phone]

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FOR THE NORTHERN DISTRICT OF CALIFORNIA

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BERTI PRODUCE – SAN FRANCISCO,
INC.; EDWIN CHIN dba NEW CITY FRUIT
& PRODUCE; JACOBS, MALCOLM &
BURTT; NORTH BAY PRODUCE, INC.;
WASHINGTON VEGETABLE COMPANY;
WHAT A TOMATO PRODUCE COMPANY,
INC.; and COOSEMANS SAN FRANCISCO,
INC.,

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Plaintiffs,

CASE NO. C11-03546 MEJ
CASE MANAGEMENT CONFERENCE
STATEMENT & REQUEST TO
CONTINUE CMC
CMC Date: October 27, 2011
CMC Time: 10:00 a.m.
CMC Place: Ctrm. B, 15th Floor
San Francisco

v.
ROBERT SBRAGIA; JOHN SBRAGIA;
STEVEN SBRAGIA; and PATRICIA CINI
aka PATTI CINI,
Defendants.

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Plaintiffs BERTI PRODUCE – SAN FRANCISCO, INC., EDWIN CHIN dba NEW
CITY FRUIT & PRODUCE, JACOBS, MALCOLM & BURTT, NORTH BAY PRODUCE,
INC., WASHINGTON VEGETABLE COMPANY, WHAT A TOMATO PRODUCE

CMC STATEMENT & REQUEST TO CONTINUE – Case No. C11-03546 – Page 1

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COMPANY, INC., and COOSEMANS SAN FRANCISCO, INC. (jointly “Plaintiffs”)

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respectfully file this Case Management Conference Statement.

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A.

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STATUS & REQUEST FOR CONTINUANCE

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1.

Current Status – Defendants Not Yet Served:

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On July 19, 2011, Plaintiffs filed their complaint in this matter. On September 13, 2011,

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Plaintiffs filed an amended complaint, which added a new Plaintiff, Coosemans San Francisco,

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Inc.
Plaintiffs counsel has had difficulty locating addresses for service of the Complaint on

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LAW OFFICES
RYNN & JANOWSKY, LLP
P.O. BOX 20799
OAKLAND, CALIFORNIA 94620
[phone]
FAX [phone]

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the four Defendants; however, we believe that we now have good addresses for service on all of

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the Defendants, and the First Amended Complaint and associated documents have been sent out

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for service. We expect that all Defendants will be served by next week, if they have not already

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been served.

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2.

Request for Continuance:

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Because Defendants have not yet been served, but Plaintiffs are in the process of serving

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them, Plaintiffs respectfully request that the Case Management Conference be continued for 60

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days to allow Plaintiffs to serve Defendants and so that Defendants can participate in the CMC.

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B.

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GENERAL CMC INFORMATION

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1.

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Agricultural Commodities Act (“PACA”), 7 U.S.C. § 499e(c)(5), and 28 U.S.C. § 1331. As

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noted above, Defendants have not yet been served, because Plaintiffs have not had good

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addresses for service. After an investigation, however, Plaintiffs now have what they believe are

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good service addresses, and the First Amended Complaint is out for service on all Defendants.

Jurisdiction and Service.

This Court has jurisdiction pursuant to the Perishable

CMC STATEMENT & REQUEST TO CONTINUE – Case No. C11-03546 – Page 2

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2.

Facts:

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Plaintiffs, all of whom are licensed by the United States Department of Agriculture as

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dealers of perishable agricultural commodities, sold and shipped fresh produce to Bob Sbragia

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dba Bob’s Produce Inc. (“Bob’s Produce”), which accepted the produce, but failed to pay the

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total sum due of $269,030.85, plus interest and attorneys’ fees, to Plaintiffs for the perishable

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agricultural commodities.
Bob’s Produce filed for Chapter 11 bankruptcy protection with the U.S. Bankruptcy

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Court, for the Northern District of California, on June 2, 2011, Case No. 11-32150-TEC, which

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was converted to a Chapter 7 proceeding on July 12, 2011. On August 25, 2011, the Court

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LAW OFFICES
RYNN & JANOWSKY, LLP
P.O. BOX 20799
OAKLAND, CALIFORNIA 94620
[phone]
FAX [phone]

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closed the case, after the Trustee reported that there was no property available for distribution.

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Because of the automatic stay, this action has not been initiated and litigated against Bob’s

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Produce.

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Plaintiffs are informed and believe that at all relevant times Defendants were officers,

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shareholders, and/or directors of Bob’s Produce. Bob’s Produce’s bankruptcy schedules identify

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each Defendant as a 25% shareholder in Bob’s Produce, and the Petition is signed by Defendant

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Patricia Cini, as Treasurer of Bob’s Produce. Plaintiffs are further informed and believe that at

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all relevant times Defendants – as officers, shareholders, and/or directors of Bob’s Produce –

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controlled the day-to-day operations, financial affairs, and PACA trust assets of Bob’s Produce.

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Plaintiffs included the required statutory on their invoices to properly perfect their PACA

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trust claims or otherwise perfected their PACA trust claims as required by 7 U.S.C. §

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499e(c)(3)&(4).

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3.

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Legal Issues:
A.

Did Bob’s Produce violate PACA and breach its contracts with Plaintiffs by

failing to pay them promptly and in full for the perishable agricultural commodities that

CMC STATEMENT & REQUEST TO CONTINUE – Case No. C11-03546 – Page 3

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Plaintiffs sold and shipped to it, and if so, what is the sum owed to Plaintiffs by Bob’s Produce.

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B.

Did Plaintiffs properly perfect their PACA trust rights. 7 U.S.C. § 499e(c)(3)&(4)

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[USDA licensees may perfect their PACA trust rights by printing specific language on their

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invoices or by sending a PACA Trust Notice to Bob’s Produce].

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C.

Are Defendants personally liable for the debt owed to Plaintiffs by Bob’s Produce

for the fresh fruit and vegetables that Plaintiffs sold and shipped to it? See, e.g., Sunkist

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Growers, Inc. v. Fisher, 104 F.3d 280, 282-284 (9th Cir. 1997)(“individual shareholders, officers,

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or directors of a corporation who are in a position to control PACA trust assets, and who breach

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their fiduciary duty to preserve those assets, may be held personally liable under the Act.”);

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LAW OFFICES
RYNN & JANOWSKY, LLP
P.O. BOX 20799
OAKLAND, CALIFORNIA 94620
[phone]
FAX [phone]

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Golman-Hayden Co., Inc. v. Fresh Source Produce, Inc., 217 F.3d 348 (5th Cir. 2000)(citing

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Sunkist and finding passive owner personally liable); Coosemans Specialties, Inc. v. Gargiulo,

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485 F.3d 701, 705-07 (2nd Cir. 2007)(“PACA trustees ‘are required to maintain trust assets in a

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manner that such assets are freely available to satisfy outstanding obligations to sellers of

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perishable agricultural commodities.’ 7 C.F.R. § 46.46(d)(1)”; owner individually liable for

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breach of fiduciary duty, as there is no factual dispute that factoring agreement jeopardized the

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trust funds and made them unavailable for timely payment to plaintiffs.).

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D.
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Are Plaintiffs entitled to pre-judgment interest, attorneys’ fees, and costs.

Related Cases:
Plaintiffs are not aware of any related cases or proceedings.

5.

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Relief Sought:
Plaintiffs seek judgment against Defendants, jointly and severally, in the amount of

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$269,030.85 (sums due on invoices for fresh produce), plus interest, attorneys’ fees, and costs.

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6.

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Consent to Magistrate Judge:
Plaintiffs filed their consent to the assignment of this case to a U.S. Magistrate Judge.

CMC STATEMENT & REQUEST TO CONTINUE – Case No. C11-03546 – Page 4

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Disclosure of Non-Party Interested Entities or Persons.
Plaintiffs have filed the disclosure required by Civil L.R. 3-16, and they certified and do

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certify that as of this date, other than the named parties, there is no such interest to report.

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Date: October 20, 2011

By:

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/s/ Marion I. Quesenbery
Marion I. Quesenbery
Attorneys for Plaintiffs
Berti Produce – San Francisco, Inc.; Edwin Chin
dba New City Fruit & Produce; Jacobs, Malcolm &
Burtt; North Bay Produce, Inc.; Washington
Vegetable Company; What A Tomato Produce
Company, Inc.; and Coosemans San Francisco, Inc.

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LAW OFFICES
RYNN & JANOWSKY, LLP
P.O. BOX 20799
OAKLAND, CALIFORNIA 94620
[phone]
FAX [phone]

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IT IS SO ORDERED. The Case Management Conference is continued to
January 12, 2012
___________________, at 10:00 a.m., in Courtroom B, 15th Floor, San Francisco.
All deadlines are adjusted accordingly.
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Date: October ____, 2011
____________________________________
U.S. MAGISTRATE JUDGE

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CMC STATEMENT & REQUEST TO CONTINUE – Case No. C11-03546 – Page 5