Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-casd-3_11-cv-00102/USCOURTS-casd-3_11-cv-00102-1/pdf.json

Nature of Suit Code: 890
Nature of Suit: Other Statutory Actions
Cause of Action: 07:499 Agricultural Commodities Act

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UNITED STATES DISTRICT COURT

SOUTHERN DISTRICT OF CALIFORNIA

F.T. PRODUCE, INC. d/b/a FAMILY TREE

PRODUCE,

Plaintiff,

CASE NO. 11-CV-102 JLS (WVG)

ORDER: DENYING

APPLICATION FOR

PRELIMINARY INJUNCTION

(Doc. No. 4)

vs.

AGWA, INC. d/b/a NORTH PARK

PRODUCE CHULA VISTA; JAMIL A.

NEHME; SHELDEN J. NEHME; BRENDA

J. NEHME; ROSETTE J. SOWELL,

Defendants.

On January 18, 2011, Plaintiff F.T. Produce, Inc. filed this action to enforce payment under

the Perishable Agricultural Commodities Act’s (PACA) trust provisions, 7 U.S.C. §§ 499a–499t.

(Doc. No. 1.) One day later, Plaintiff filed an ex parte application for a temporary restraining order

without notice and for a preliminary injunction hearing. (Doc. No. 4.) On January 21, 2011, the Court

granted Plaintiff’s application, entered a temporary restraining order, and set a hearing to show cause

why a preliminary injunction should not be entered. (Doc. No. 6 (TRO Order).) On January 28, 2011,

Defendants Agwa, Inc., Jamil A. Nehme, Shelden J. Nehme, Brenda J. Nehme, and Rosette J. Sowell

filed an opposition to the imposition of a preliminary injunction (Doc. Nos. 12, 13), and on January

31, 2011, Plaintiff replied (Doc. No. 15).

The Court held a show-cause hearing on February 1, 2011. (Doc. No. 16.) James Lewin

Case 3:11-cv-00102-JLS-WVG Document 17 Filed 02/02/11 Page 1 of 3
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appeared for Plaintiff, and Ben-Thomas Hamilton appeared for Defendants. Having considered the

parties’ arguments and the law, the Court DENIES Plaintiff’s application for a preliminary injunction.

The Court’s Order granting Plaintiff’s ex parte motion for a TRO fully set forth the legal

standard for granting a preliminary injunction. (TRO Order 2.) In summary, “[a] plaintiff seeking a

preliminary injunction must establish that he is likely to succeed on the merits, that he is likely to

suffer irreparable harm in the absence of preliminary relief, that the balance of equities tips in his

favor, and that an injunction is in the public interest.” Winter v. Natural Res. Def. Council, Inc.,

— U.S. —, 129 S. Ct. 365, 374 (2008) (citing Munaf v. Geren, 553 U.S. 674, 689–90 (2008)).

At this juncture, the Court finds that Plaintiff has failed to establish that it is likely to suffer

irreparable harm in the absence of preliminary relief. Defendants currently have possession of

$66,425.33 in PACA trust assets, which are due and owing to Plaintiff. (TRO Order 4.) And this

amount is past due even if the parties agreed to a thirty-day payment term, as Defendants contend.

(See Doc. No. 12-2 (Nehme Decl.) ¶ 6; Doc. No. 12-3 (Sowell Decl.) ¶ 5; Doc. No. 15-1 (Guzman

Decl.) ¶ 4 (stating that sales took place “between November 6, 2010 and December 18, 2010”) .)

However, Defendants are currently repaying Plaintiff at a rate of “approximately $1,300.00

per week.” (Nehme Decl. ¶ 15.) Plaintiff has made no evidentiary showing that these payments will

cease in the absence of a preliminary injunction, nor has Plaintiff shown that its business will be

harmed without immediate payment. And although Defendants have effectively admitted that they

are currently using trust assets to pay other suppliers (see id. ¶¶ 16–17), Plaintiff has not demonstrated

that Defendants are in such dire financial straits that these acts could prejudice Plaintiff’s ability to

recover the full $66,425.33, see 7 C.F.R. § 46.46(a)(2) (defining “dissipation”). Cf. Rey Rey Produce

SFO, Inc. v. Mis Amigos Meat Market, Inc., 2008 WL 1885738, at *2–3 (N.D. Cal. Apr. 24, 2008)

(granting preliminary injunction on showing that defendants were dissipating trust funds and were in

a “precarious financial position”).

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Case 3:11-cv-00102-JLS-WVG Document 17 Filed 02/02/11 Page 2 of 3
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For the reasons stated, Plaintiff’s application for a preliminary injunction is DENIED

WITHOUT PREJUDICE, and the TRO entered on January 21, 2011 is HEREBY DISSOLVED.

IT IS SO ORDERED.

DATED: February 2, 2011

Honorable Janis L. Sammartino

United States District Judge

Case 3:11-cv-00102-JLS-WVG Document 17 Filed 02/02/11 Page 3 of 3