The USDA’s Agricultural Marketing Service posted the announcement of the consent decision on its website on March 13. It states the company may not operate in the produce industry until March 2, 2014, when it must reapply for a license under the Perishable Agricultural Commodities Act.
The consent decision also bans Empire’s principal, Samuel Zappala, from being employed by or affiliated with any PACA licensee until March 2, 2013. At that time he can post a USDA-approved bond.
Another principal is challenging his responsibility status in the case. The USDA did not indicate who that principal is, but federal court records show Samuel Zappala’s brother, James Zappala, as a co-owner of Empire Fresh Cuts.
The phone number for the Empire Fresh Cuts office is no longer in service.
According to the USDA, Empire owes 13 sellers $1.02 million for 119 lots of produce.
The USDA did not list creditors, but a search of civil cases filed in federal court in the Northern District of New York showed several actions filed by produce sellers seeking payment. Those cases include:
- Ferlito Farms Inc., Oswego, N.Y., $429,590 for 36 shipments of onions;
- Desch Fresh Produce Co. LLC, Charlottesville, Va., $228,606 for 30 truckloads of onions;
- River Point Farms LLC, Hermiston, Ore., $189,718: The judge in this case granted a joint request for dismissal in 2009; and
- DeBruyn Produce Co,. Zeeland, Mich., $72,873.
The USDA sanctioned Empire Fresh Cuts in November 2010 for failure to pay $228,606 to an unspecified Virginia seller.
Court documents from July 2010 show that Samuel Zappala stated the Empire onion plant had been closed.
In December 2010, the Oswego County Business newspaper reported the company had closed, leaving unresolved legal issues with the county’s economic development organization related to financing for capital improvements. In 2004, The Packer reported Empire opened a 27,000-square-foot onion processing facility.
A sister company, Oswego Growers & Shippers, also owned by the Zappala brothers, was also reportedly closed in 2010. The Oswego newspaper reported Oswego Growers & Shippers began operations in 1978.