Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-cand-5_06-cv-06478/USCOURTS-cand-5_06-cv-06478-1/pdf.json

Nature of Suit Code: 891
Nature of Suit: Agricultural Acts
Cause of Action: 07:499 Agricultural Commodities Act

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Case No. C 06-6478 JF (HRL)

ORDER GRANTING SECOND EX PARTE APPLICATION FOR TRO

(JFLC2)

**E-Filed 11/15/06**

NOT FOR CITATION

IN THE UNITED STATES DISTRICT COURT

FOR THE NORTHERN DISTRICT OF CALIFORNIA

SAN JOSE DIVISION

ANDREW SMITH COMPANY,

 Plaintiff,

 v.

CUSTOM CUTS, INC., et al.,

 Defendants.

Case Number C 06-6478 JF (HRL)

ORDER GRANTING IN PART

SECOND EX PARTE APPLICATION

FOR TRO AND SETTING HEARING

ON MOTION FOR PRELIMINARY

INJUNCTION

[re: doc. no. 7]

On October 17, 2006, Plaintiff Andrew Smith Company filed the complaint in this action,

alleging that Defendants Custom Cuts, Inc. and Bradley Beckman failed to pay approximately

$150,000 due and owing for perishable agricultural commodities that Plaintiff had shipped to

Defendants. The complaint alleges the following claims: (1) breach of contract; (2) enforcement

of statutory trust provisions of the Perishable Agricultural Commodities Act (“PACA”); (3)

failure to account and pay in violation of PACA; (4) injunctive relief; (5) unjust enrichment; (6)

conversion; and (7) declaratory relief.

Plaintiff also filed an ex parte application for temporary restraining order (“TRO”)

prohibiting Defendants from taking any action that would dissipate Plaintiff’s beneficiary interest

in Defendants’ assets. A TRO may be granted without notice to the adverse party only if “(1) it

Case 5:06-cv-06478-JF Document 12 Filed 11/15/06 Page 1 of 4
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Case No. C 06-6478 JF (HRL)

ORDER GRANTING SECOND EX PARTE APPLICATION FOR TRO

(JFLC2)

clearly appears from specific facts shown by affidavit or by the verified complaint that immediate

and irreparable injury, loss, or damage will result to the applicant before the adverse party or that

party’s attorney can be heard in opposition, and (2) the applicant’s attorney certifies to the court

in writing the efforts, if any, which have been made to give the notice and the reasons supporting

the claim that notice should not be required.” Fed. R. Civ. P. 65(b). Moreover, in this district an

applicant for TRO must give notice to the adverse party “[u]nless relieved by order of a Judge for

good cause shown.” Civ. L.R. 65-1(b).

The Court denied Plaintiff’s initial ex parte application for TRO on the ground that

Plaintiff had not provided an declaration of counsel explaining why no notice of the application

for TRO was given to Defendants, and had not obtained an order from this Court relieving

Plaintiff from the notice requirement. Plaintiff has filed a second ex parte application for TRO,

accompanied by the required declaration of counsel. Plaintiff requests that Defendants be

restrained from the following conduct:

A. Removing, withdrawing, transferring, assigning or selling to any other person

or entity, the proceeds from the sales or any or all existing or future inventories of

foods, including, but not limited to, inventory on hand, perishable agricultural

commodities, commodities, and/or other products derived from perishable,

including frozen , agricultural commodities, and/or receipts of payments for such

commodities sold prior to the date of this order, and/or otherwise disposing of

corporate assets, books or funds;

B. Taking any other action whatsoever which causes, has the effect of causing, or

which otherwise dissipates Plaintiff’s beneficiary interest in the PACA Trust

assets;

C. Taking any other action whatsoever which violates 7 U.S.C. §499e(c)(1)

through (4) and 7 U.S.C. §499b(4) of the Perishable Agricultural Commodities

Act (“PACA”); and

D. Transferring, withdrawing, or in any other manner removing PACA Trust

assets, including funds on deposit in banking accounts held by or on behalf of

Defendants at any and all banking institutions from Defendants’ banking account,

including but not limited to Defendants’ accounts at Great Midwest Bank, 4775 S.

27th Street, Greenfield, WI 53221, Account Number 0180026011, or any

subsequently identified account standing in the name or for the benefit of

Defendants, or any of them.

For good cause shown, the Court will issue the requested TRO restraining Defendants from the

above conduct pending disposition of Plaintiff’s motion for preliminary injunction, and will set a

hearing date on such motion.

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Case No. C 06-6478 JF (HRL)

ORDER GRANTING SECOND EX PARTE APPLICATION FOR TRO

(JFLC2)

Plaintiff also request that Defendants be ordered to deposit in excess of $150,000 in a

trust account to be opened by Plaintiff’s attorneys. It appears from Plaintiff’s papers that

Plaintiff is one of many competing creditors for limited assets held by Defendants. Under these

circumstances, the Court declines to order deposit of the funds Plaintiff claims it is owed, which

would in effect bump Plaintiff up in line ahead of other creditors. 

ORDER

(1) Plaintiff’s ex parte application for TRO is GRANTED IN PART. Defendants are

HEREBY RESTRAINED from the conduct described in sections A-D above; and

(2) Plaintiff’s motion for preliminary injunction is set for hearing on December 8,

2006. Plaintiffs may file a brief in support of such motion on or before November

21, 2006. Any opposition shall be filed on or before November 28, 2006. Any

reply shall be filed on or before December 5 2006.

DATED: 11/15/06

__________________________________

JEREMY FOGEL

United States District Judge

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Case No. C 06-6478 JF (HRL)

ORDER GRANTING SECOND EX PARTE APPLICATION FOR TRO

(JFLC2)

This Order was served on the following persons:

Paul William Moncrief paul@johnsonmoncrief.com

Case 5:06-cv-06478-JF Document 12 Filed 11/15/06 Page 4 of 4