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Juan Osborno, An Individual Doing Business As Calmex Produce v. Samuel W. Fong

February 9, 2011


The opinion of the court was delivered by: Saundra Brown Armstrong United States District Judge


Dkt. 3, 12

Plaintiff Juan Osborno ("Plaintiff") brings the instant action under the Perishable Agriculture Commodities Act ("PACA"), 7 U.S.C. § 499a, et seq., to recover $45,091 from Defendant Samuel Fong ("Defendant" or "Fong") for unpaid perishable produce. The 17 parties are presently before the Court on Plaintiff's motion for preliminary injunction.

Dkt. 3, 12. Actual notice of the motion was properly provided to Defendant, who has not 19 filed an opposition. Having read and considered the papers filed in connection with this 20 matter and being fully informed, the Court hereby GRANTS the motion for the reasons set 21 forth below. The Court, in its discretion, finds this matter suitable for resolution without 22 oral argument. See Fed. R. Civ. P. 78(b); N.D. Cal. Civ. L.R. 7-1(b).


On January 20, 2011, Plaintiff filed the instant action, along with an Ex Parte Motion for Temporary Restraining Order and Motion for Preliminary Injunction, requesting 26 that Defendant be enjoined from dissipating trust assets in the sum of $45,091. On January 27 26, 2011, the Court denied Plaintiff's request for a temporary restraining order on the 28 ground that Plaintiff had not shown good cause for the issuance of such an order without notice. The Court ordered Plaintiff to serve his complaint and motion papers along with a 2 copy of the Court's January 26, 2011 Order within three days. Dkt. 11. The Order directed 3 to Defendant to file his opposition to Plaintiff's motion for preliminary injunction by no 4 later than February 3, 2011, and "warned that the failure to timely file an opposition to the 5 motion for preliminary injunction will be deemed to be a consent to the granting of the 6 preliminary injunction requested by Plaintiff." Id. at 5. Plaintiff filed a Certificate of Service evidencing that Defendant was personally served with the requisite documents on January 27, 2011. Dkt. 13. To date, the Court has received no opposition to Plaintiff's 9 motion or any other submission by Defendant.*fn1


of success on the merits; (2) a likelihood of irreparable harm to the moving party in the 13 absence of preliminary relief; (3) that the balance of equities tips in the favor of the moving 14 party; and (4) that an injunction is in the public interest. Winter v. Natural Res. Def. Council, Inc., ---U.S. ---, 129 S.Ct. 365, 376 (2008). These factors may be evaluated on a 16 sliding scale, such that a preliminary injunction may be issued when plaintiff demonstrates "serious questions going to the merits and a hardship balance that tips sharply toward the 18 plaintiff . assuming the other two elements of the Winter test are also met." Alliance for 19 the Wild Rockies v. Cottrell, --- F.3d ---, 2011 WL 208360, at *4 (9th Cir. Jan. 25, 2011).

To obtain preliminary injunctive relief, the moving party must show: (1) a likelihood


seq. To ensure that suppliers of produce are paid, PACA imposes "a trust on the perishable 4 agricultural commodities received by the purchaser, all inventories of food or other 5 products derived therefrom, and receivables or proceeds from the sale of such commodities 6 and products." Middle Mountain Land and Produce Inc. v. Sound Commodities Inc., 307 PACA governs the sale of wholesale quantities of produce. See 7 U.S.C. § 499a, et F.3d 1220, 1224 (9th Cir. 2002). The produce buyer must maintain the trust for the benefit 8 of the unpaid suppliers, sellers, or agents who provided the commodities, until full payment 9 has been made. 7 U.S.C. § 449e(c)(2). Upon an appropriate showing, the Court may enter 10 a preliminary injunction and freeze the PACA trust assets held in trust by the defendant and 11 prevent payment of these assets to anyone other than the plaintiff. See Inn Foods, Inc. v. 12 Fong, LLC, No. C 07-649 SI, 2007 WL 2769849, at *1 (N.D. Cal. Sept. 21, 2007). 13 the fact that Defendant has not challenged any of Plaintiff's claims, the Court finds that Defendant purchased $45,091 in perishable agricultural commodities in interstate 16 commerce from Plaintiff, that Plaintiff provided Defendant with notice of intent to preserve 17 trust benefits and that Defendant failed to pay Plaintiff for said perishable agricultural 18 commodities in violation of PACA, 7 U.S.C. §499e(c). The Court further finds that 19 Defendant has, in fact, dissipated the PACA trust by failing to maintain sufficient assets to 20 satisfy Plaintiff's PACA trust claims. Finally, the Court finds that there is sufficient 21 evidence of dissipation of assets subject to the PACA trust to warrant the relief granted in 22 this order. 23


institutions, and all persons in active concert or participation with him or who receive Based upon the pleadings and the supporting ...

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