Recently, the Supreme Court of the United States heard oral arguments in the case of Czyzewski v. Jevic Holding Corporation. This case involves a dispute over commonly used Chapter 11 bankruptcy settlement procedures. More specifically, the question at stake is how much power individual bankruptcy courts will have to approve bankruptcy settlements that deviate from the typical order of creditor preference.
The Perishable Agricultural Commodities Act (PACA), which was passed in 1930, regulates the sale of fruits and vegetables. PACA covers a wide variety of situations, including what happens in the event that a produce buyer goes bankrupt. The Act provides sellers with powerful tools to collect payments and also has major ramifications on the creditors that lend to businesses that are within the scope of the regulations. California is one of the nation's leading producers of fruits and vegetables and it is critical that creditors within the state understand how PACA might impact their rights. If you have any questions about PACA and bankruptcy, please contact an experienced San Jose business bankruptcy attorney for immediate legal assistance.