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Custom Pak Brokerage, LLC v. Dandrea Produce, Inc.

United States District Court, D. New Jersey

March 4, 2015

CUSTOM PAK BROKERAGE, LLC, Plaintiff,
v.
DANDREA PRODUCE, INC., RONALD P. DANDREA, FRANK S. DANDREA, STEVEN P. DANDREA, and JEFFREY J. GERAGI, Defendants.

THOMAS G. ALJIAN, JR., ALJIAN & MONTGOMERY, COLTS NECK, NJ, MICHAEL J. KEATON, SCOTT E. HILLISON, KEATON LAW FIRM, P.C., DEERFIELD, ILLINOIS, On behalf of plaintiff.

MICHAEL L. STONBERG, KENNY SHELTON LIPTAK NOWAK LLP, NEW YORK, NY, On behalf of the Dandrea defendants.

JEFFREY J. GERAGI, DELRAY BEACH, FL, Appearing pro se.

OPINION

NOEL L. HILLMAN, District Judge.

Presently before the Court are the motions of the defendants for summary judgment. For the reasons expressed below, defendants' motions will be denied.

BACKGROUND

Plaintiff, Custom Pak Brokerage, LLC, filed suit against defendants Dandrea Produce Inc. ("Dandrea") and the company's principals, Ronald P. Dandrea, Frank S. Dandrea, and Steven P. Dandrea, to recover unpaid invoices for watermelons Custom Pak sold to Dandrea. Plaintiff claims that Dandrea owes it $619, 083.61, plus interest, for the unpaid watermelon shipments, and that defendants, both the company and the principals, have violated their obligations under the Perishable Agricultural Commodities Act, 1930, 7 U.S.C. §§ 499a-499t ("PACA") to maintain a sufficiently funded trust account. The Dandrea defendants have filed a counterclaim against plaintiff, claiming that plaintiff failed to deliver the quantity and quality of watermelons that they contracted for.

In addition to its claims against the Dandrea defendants, plaintiff advances claims against defendant Jeffrey Geragi, a former employee of plaintiff, for breach of fiduciary duty and tortious interference with contractual relations. Plaintiff claims that the Dandrea defendants informed plaintiff that Geragi, as plaintiff's agent, agreed to much lower pricing than what was stated on plaintiff's invoices. Plaintiff alleges that Geragi retroactively tried to reduce the agreed upon price between plaintiff and Dandrea in order to secure employment with Dandrea.[1]

The Dandrea principals and the company have moved for summary judgment on plaintiff's claims against them. The principals argue that because the company has sufficient assets to pay plaintiff's claim, if proven, they cannot be held individually liable for violations of PACA. They also argue that because plaintiff entered into a contract for the sale of watermelons with the Dandrea company, and not the individual defendants, plaintiff cannot maintain its section 499b claim against them.

The Dandrea company has moved for summary judgment based on the argument that there is no disputed fact as to the terms of the watermelon contract between Dandrea and plaintiff. Defendants argue that because both Geragi, who was plaintiff's agent, and Steven Dandrea testified to the same terms of the contract, no dispute of facts exists as to the agreement. Because there are no disputed facts concerning the agreement, defendants argue that the Court should perform a sale-by-sale review of each of the 48 watermelon shipments to determine what is owed to whom. Through that analysis, defendants argue that it is clear that plaintiff actually owes defendant almost $10, 000.

Plaintiff has opposed both motions. With regard to the individual defendants' motion, plaintiff argues that it is irrelevant that the Dandrea company may have sufficient assets to satisfy any judgment against it. Plaintiff argues that its claims are based on the company and the principals' failure to fund the PACA trust as required by the Act. Plaintiff further argues that even if the Dandrea company's ability to pay were relevant, defendants have failed to provide summary judgmentworthy evidence of its solvency. With regard to the Dandrea company's motion for summary judgment on the terms of the contract, plaintiff argues that significant disputed issues of material fact on the terms of the agreements preclude the entry of summary judgment.

DISCUSSION

A. Subject Matter Jurisdiction

This Court has jurisdiction over this matter pursuant to 28 U.S.C. § 1331 because plaintiff has asserted claims under section 5(c)(5) of the Perishable Agricultural Commodities Act, 1930 ("PACA"), 7 U.S.C. § 499e(c)(5). The Court has supplemental ...


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