How can a buyer be prevented from transferring PACA trust assets?
If a produce buyer’s PACA trust is being dissipated or threatened with dissipation, U.S. District Courts are empowered to issue injunctions to freeze the buyer’s assets and prevent the transfer of any PACA trust assets without further court order. Obtaining an injunction is a harsh remedy. The seller must prove to the court that the buyer did not maintain trust assets in a manner which would ensure they are freely available to satisfy the outstanding obligations of produce sellers. Additionally, the seller may be required to show the buyer committed acts which diverted trust assets, from their only legal purpose, payment of produce suppliers.
