USDA cites bankrupt company for PACA debts

04/04/2013 11:53:00 AM
Coral Beach

USDA PACA actionAlmost six months after the company’s $1.75 million in debts were discharged in a Chapter 7 bankruptcy case, the U.S. Department of Agriculture cited United Potato Distributors Inc. for failure to pay dozens of produce suppliers.

In a notice posted March 28, the USDA barred the company, also known as United Distributors Inc., Los Angeles, from operating in the industry until March 2015. Owner William Gerard is barred until March 2014 from working for or with any entity licensed under the Perishable Agriculture Commodities Act.

The USDA notice said United Distributors failed to pay 39 sellers a total of more than $759,000 for 587 lots of produce. The company’s phone has been disconnected and it is listed as out of business by Red Book Credit Services.

Both Gerard and his company filed for Chapter 7 bankruptcy in May 2012. In July, the bankruptcy trustee reported to the court that there was no property available for distribution. The bankruptcy judge discharged debts totaling $1.75 million on Sept. 4, 2012.

Of the 786 creditors listed in the bankruptcy filing, SGS Produce, Los Angeles, had the largest single claim at $262,363.

The bankruptcy filing showed a pattern of decline from at least 2010. United Distributors had an income of $21.6 million in 2010, dropping to $7.1 million in 2011. For its operations in 2012 the company listed income of $168,902.



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