Free Declaration - District Court of California - California

Case 3:08-cv-00914-JLS-JMA

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LAW OFFICES RYNN & JANOWSKY 4100 NEWPORT PLACE DRIVE SUITE 700 NEWPORT BEACH, CALIFORNIA 92660 (949) 752-2911 FAX (949) 752-0953

PATRICIA J. RYNN State Bar No. 092048 ELISE O'BRIEN, State Bar No. 245967 RYNN & JANOWSKY, LLP 4100 Newport Place Drive, Suite 700 Newport Beach, CA 92660 Telephone: (949) 752-2911 Facsimile: (949) 752-0953 E-Mail: [email protected] E-Mail: [email protected] Attorneys for Plaintiffs SUCASA PRODUCE, et al. UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF CALIFORNIA, SAN DIEGO DIVISION

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SUCASA PRODUCE, an Arizona Partnership; P.D.G. PRODUCE, INC., an Arizona corporation; EXPO FRESH, LLC, a California limited liability company; H.M. DISTRIBUTORS, INC., an Arizona corporation; PRIME TIME SALES, LLC, a California limited liability company; VANAL DISTRIBUTING, INC., an Arizona corporation, DEL CAMPO SUPREME, INC., an Arizona corporation; MEYER, LLC, a California limited liability company, Plaintiffs vs. SAMMY'S PRODUCE, INC., a California corporation; CALIFORNIA PRODUCE EXCHANGE, INC., a California corporation; US FARMS, INC., a California corporation; WORLD GARLIC & SPICE INC., a California corporation; AMERICAN NURSERY EXCHANGE, INC., a California corporation; YAN SKWARA, an individual; SAMUEL V. NUCCI, an individual; DARIN PINES, an individual, Defendants.

CASE NO. 08-cv-914 JLS (JMA) DECLARATION OF LAURA DE LA ROSA IN SUPPORT OF PLAINTIFFS' MOTION TO EXPAND THE PRELIMINARY INJUNCTION; EXHIBITS IN SUPPORT THEREOF

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LAW OFFICES RYNN & JANOWSKY 4100 NEWPORT PLACE DRIVE SUITE 700 NEWPORT BEACH, CALIFORNIA 92660 (949) 752-2911 FAX (949) 752-0953

I, LAURA DE LA ROSA, declare and depose as follows: 1. I currently am and during all times mentioned in this declaration have been the

Credit Manager of Plaintiff and Moving Party herein, DEL CAMPO SUPREME, INC. ("DEL CAMPO"). 2. DEL CAMPO is a corporation based in Nogales, Arizona which sells wholesale

quantities of perishable agricultural commodities ("produce"), including tomatoes, and which is licensed as a dealer under the Perishable Agricultural Commodities Act of 1930, as amended, [7 U.S.C. §499a, et seq.] ("PACA"). 3. I am personally familiar with all matters which are the subject of this declaration

and the facts stated herein are based upon my own personal knowledge, except as to those matters based upon information and belief, and as to those matters, I believe them to be true. If called as a witness in this proceeding, I would and could competently testify to the matters stated herein. 4. DEL CAMPO is a produce creditor of Defendant, Sammy's Produce, Inc.

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("SAMMY'S"). SAMMY'S is a produce dealer as defined under 7 U.S.C. §499a, and operates subject to and is licensed under the PACA. SAMMY'S operates as wholesale buyer and seller of perishable agricultural commodities, and in that capacity has purchased perishable agricultural commodities from Plaintiff, through a broker, for resale to SAMMY'S own customers. 5. Defendants Yan Skwara ("SKWARA"), Samuel V. Nucci ("NUCCI"), and Darin

Pines ("PINES") are listed as SAMMY'S President, Vice President of Sales and Vice President of Operations, respectively, with the Blue Book (a credit service for the produce industry). 6. I make this declaration in support of Plaintiffs' Motion to Expand the Preliminary

Injunction, to prevent Defendants' further dissipation of PACA trust assets and to compel turnover of all such trust assets rightfully belonging to Plaintiffs. 7. As Credit Manager of DEL CAMPO, my responsibilities include monitoring its

sales of perishable agricultural commodities, including the sales that are the subject of this dispute, and supervising collection of its accounts receivable for such sales. I have custody and

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LAW OFFICES RYNN & JANOWSKY 4100 NEWPORT PLACE DRIVE SUITE 700 NEWPORT BEACH, CALIFORNIA 92660 (949) 752-2911 FAX (949) 752-0953

control of DEL CAMPO'S sales and accounts receivable records as they relate to Defendant SAMMY'S, and I am thoroughly familiar with the manner in which those records are compiled. 8. The sales and accounts receivable records of Plaintiffs, including invoices, billing

statements and other related documents, are made in the ordinary course of business and are made at or near the time of the occurrence of the event of which they are a record. These sales records are made either by me or under my direction and supervision by DEL CAMPO'S employees whose duty it is to make such documents. 9. The produce that is the subject of this dispute was sold in the course of interstate

commerce between the states of Arizona and California. 10. The total balance due to H.M. from Defendants results from a series of nine (9)

sales transactions involving tomatoes shipped between January 15, 2008 and February 15, 2008. Between on or about those dates, DEL CAMPO sold and delivered to Defendants truck lots of tomatoes of various varieties and quantities, being perishable agricultural commodities, which Defendant SAMMY'S accepted without objection, for agreed-upon selling prices as reflected on DEL CAMPO'S invoices, of which a total principal amount of $81,926.40 remains outstanding and seriously past due. 11. An invoice for each shipment was prepared and mailed to Defendant SAMMY'S

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by DEL CAMPO on or about the day of each transaction. True and correct copies of Plaintiff DEL CAMPO'S nine invoices confirming these sales are appended hereto and incorporated herein by reference as Exhibit 1. A true and correct copy of Plaintiff DEL CAMPO'S aged statement of account summarizing the outstanding invoices and applying partial payments received to date, (hereafter "Aging Report") is appended hereto and incorporated herein by this reference as Exhibit 2. 12. Although Defendant SAMMY'S received and accepted the produce shipments

without objection, Defendant SAMMY'S has failed to pay for the produce that it purchased from DEL CAMPO. 13. As the Credit Manager of Plaintiff DEL CAMPO, I review and approve any price adjustments, credits or discounts issued by DEL CAMPO in connection with the sales that are 3

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LAW OFFICES RYNN & JANOWSKY 4100 NEWPORT PLACE DRIVE SUITE 700 NEWPORT BEACH, CALIFORNIA 92660 (949) 752-2911 FAX (949) 752-0953

the subject of this dispute. As of the date of this Declaration, no price adjustments of any amount have been issued to Defendants. Moreover, except for the $5,000.00 payment on

account received from SAMMY'S on May 13, 2008, no other payments have been received toward any of the outstanding invoices reflected in Exhibit 1 or Exhibit 2, and the cumulative balance due for all amounts reflected on those invoices and the Aging Report is therefore correct. 14. Further, as the Credit Manager of DEL CAMPO, it is my responsibility to make certain that DEL CAMPO complies with all requirements necessary to preserve its trust rights under PACA for all unpaid shipments of produce, including the shipments that are the subject of this dispute. DEL CAMPO is now, and during all times herein has been a PACA licensee, operating under PACA license no. 19920258. In compliance with the statutory filing

requirements, I made certain that each of DEL CAMPO'S invoices set forth the following statutory language required by PACA to preserve DEL CAMPO'S PACA trust benefits: "The perishable agricultural commodities listed on this invoice are sold subject to the statutory trust authorized by section 5(c) of the Perishable Agricultural Commodities Act, 1930 (7 U.S.C. 499e(c)). The seller of these commodities retains a trust claim over these commodities, all inventories of food or other products derived from these commodities and any receivables or proceeds from the sale of these commodities until full payment is received."

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See, Exhibit 1, which shows that the above-quoted language appears on the face of each invoice sent to Defendants concerning the transactions that are the subject of this dispute. 15. For the above-stated reasons, I am confident that DEL CAMPO has taken all steps

necessary to preserve its PACA trust rights in connection with its outstanding invoices in this proceeding. 16. As of the date of this declaration, the entire principal balance of $81,926.40 due to

DEL CAMPO from Defendants remains delinquent. Because of Defendants' failure to make payments when promised, and the seriously delinquent status of its account with our Company, and SAMMY'S admitted lack of sufficient funds to pay the amount it owes DEL CAMPO, I believe that there is a great risk that DEL CAMPO will not recover the balance due to it without

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LAW OFFICES RYNN & JANOWSKY 4100 NEWPORT PLACE DRIVE SUITE 700 NEWPORT BEACH, CALIFORNIA 92660 (949) 752-2911 FAX (949) 752-0953

this Court's intervention and issuance of an injunction restraining Defendants from further dissipation of PACA trust assets. 17. At no time have any of the Defendants, or anyone acting on behalf of Defendants,

ever denied owing Plaintiff DEL CAMPO money for the produce it received, nor have they disputed that the cumulative principal balance of $81,926.40 remains due to DEL CAMPO from SAMMY'S. 18. In or about March 2008, I began contacting Yan SKWARA on a regular basis to

request payments of the amount due to DEL CAMPO from SAMMY'S. Mr. SKWARA always assured me that DEL CAMPO would be paid, however, Mr. SKWARA explained to me that SAMMY'S was owed a lot of money from its customers and was struggling to get paid. I advised Mr. SKWARA that DEL CAMPO would have to file a complaint with PACA if we were not paid immediately. After this conversation, DEL CAMPO received a check from SAMMY'S dated March 19, 2008 in the amount of $10,400 for invoice number 073487. 19. In or about May, 2008, Mr. SKWARA stopped answering my phone calls and

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emails. I had to resort to leaving voicemails on his cell phone, although sometimes I couldn't even leave voicemails because his mailbox was full. DEL CAMPO received one more payment from SAMMY'S, a check dated May 8, 2008 in the amount of $5,000 which was applied to invoice number 073486. After applying this payment, the cumulative principal balance of $81,926.40 remains due to DEL CAMPO from SAMMY'S. 20. Because Defendants have (a) admitted that they cannot promptly and fully pay the

PACA trust debt to DEL CAMPO and (b) repeatedly failed to remit payments as promised, I am quite certain that Defendants have dissipated the PACA trust assets they control in violation of PACA. Absent immediate intervention from this Court, I believe those trust assets, which rightfully belong to the Plaintiffs in this action, will continue to be dissipated and will remain beyond the reach of the Plaintiffs herein. 21. DEL CAMPO relies upon its customers' prompt payment for produce sales so

that it can effectively and adequately manage its current payables to its own vendors, monitor its cash flow, and make informed business decisions. The failure of Defendants to adequately 5

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