In what company officials describe as a restructuring, Purfresh Inc. has issued a notice of “assignment for the benefit of creditors.”
Brian Westcott, president and chief executive officer of the Freemont, Calif., company said the assignment action was “a prudent move to get assets to companies that can grow and enhance them.”
Purfresh Inc. will continue operating with a sole product line under the Purfresh Transport brand, which uses ozone to enhance shelf life and disinfect fresh produce, according to the company’s website.
The assignment for the benefit of creditors, referred to as an ABC action, is an alternative to filing for bankruptcy. The notice of assignment, dated Feb. 16, includes an Aug. 13 deadline for creditors to file claims.
Originally formed under the name Novazone Inc., the company changed its name to Purfresh in 2007. At that time it provided a range of safety products and services for the storage and transportation of fresh produce.
However, as a result of a patent infringement case filed by Tessenderlo Kerley Inc., Phoenix, related to a line of products under the Purshade brand, Purfresh agreed to sell that portion of its business to Tessenderlo in August 2011 in exchange for the case being dropped.
Purfresh sold its cold storage division in January to Ozone International LLC, Bainbridge Island, Wash.
“The (assignment) is really a restart, or a restructuring, to allow new investment in a more focused business,” said Westcott, who took the reins as CEO in February. “We looked at all the products and business and kept Purfresh Transportation and are concentrating on growing and improving that business now.”
Westcott said he was not sure of the status of two federal court cases filed against Purfresh in 2008 and 2011 regarding alleged damage to apples related to cold storage ozone systems. He said the insurance company that the former Purfresh organization had policies with is the primary defendant in those cases.
The 2008 case, filed by Borton & Sons Inc., Yakima, Wash., went to trial in March 2011. A jury found in favor of Borton and the fruit company was awarded $770,000. Purfresh appealed in June 2011. The case is pending in the U.S. Court of Appeals Ninth Circuit.
The 2011 case, filed by Custom Apple Packers Inc., alleges $300,000 in damages. It is set to go to trial in January 2013.