The Unsuspecting Fiduciary The Curious Case of PACA and Personal Liability

The Unsuspecting Fiduciary The Curious Case of PACA and Personal Liability

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The Perishable Agricultural Commodities Act (PACA)1 is a comprehensive statute regulating the buying and selling of perishable agricultural commodities (i.e., fresh fruits and vegetables).2 Since PACA's enactment in 1930, amendments to the statute have given growers and suppliers of perishable food powerful tools to protect their right to be paid for their produce. While the goal of Congress has been to protect the more vulnerable players in a vital area of commerce, PACA's protection of growers and suppliers comes at the cost of others in the industry, such as the businesses that purchase perishable food, the individuals who manage those businesses, and the lenders who provide the purchasing companies with financing.3 In the context of bankruptcy, PACA turns the usual distribution scheme on its head, placing growers and suppliers, who would otherwise be unsecured creditors, at the front of the line. Further, to the extent the claims of such growers and suppliers cannot be satisfied by the purchaser, the growers and suppliers can turn to individuals within businesses that purchase perishable food for the satisfaction of their claims. In certain instances, individuals in control of the company, such as officers and directors, are considered fiduciaries with respect to the money owed suppliers. Thus, anyone working for or representing a purchaser falling under the purview of PACA must be aware that a purchaser's inability to pay a grower or supplier may result in personal liability for the officers, directors and others in control of the purchasing company.

PACA Overview

PACA was enacted to protect sellers of perishable food who had been routinely subjected to unfair business practices by commission merchants, dealers and brokers, as those terms are defined in PACA.4 Congress understood that the nature of the fresh-produce industry often required growers and suppliers to "entrust their products to a buyer or commission merchant who may be thousands of miles away, and depend for their payment upon his business acumen and fair dealing."5 Historically, and as Congress observed in enacting PACA, when the market was in decline, dealers would improperly reject shipments from produce suppliers rather than accept the shipment and pay the contract price.6 Thus, PACA "was enacted to provide a measure of control over a branch of industry which is almost exclusively in interstate commerce, is highly competitive, and presents many opportunities for sharp practice and irresponsible business conduct."7

In the 1980s, Congress determined that PACA needed amending to address the problem of commission merchants, dealers or brokers, due to insolvency or otherwise, either not paying suppliers for deliveries or paying them late.8 In deciding to amend PACA, Congress observed the following:

Producers and shippers of perishable commodities are, for the most part, small-size businesses. The process of growing, harvesting, packing and shipping perishables is a real gamble; costs are high, capital is tied up in farm land and machinery, and returns are delayed until the crop is sold. If the grower-shipper cannot realize any returns on the sale of the crop when due, he may not be able to survive. Thus, where business failures or reorganizations occur on the part of buyers of their crop, the growers are usually the parties least able to withstand the losses and inevitable delays which result from such actions.9

Congress was particularly concerned with protecting the interests of unsecured produce suppliers from lenders who had obtained a security interest in a purchaser's entire inventory, including the perishable produce. If a purchaser then became insolvent, a supplier of perishable food had little recourse but to stand in line behind the lenders with the rest of the unsecured creditors.10 Congress recognized that:

Many commission merchants, dealers or brokers, in the normal course of their business transactions, operate on bank loans secured by [the] inventories, proceeds or assigned receivables from sales of perishable agricultural commodities, giving the lender a secured position in the case of insolvency. Under present law, sellers of fresh fruits and vegetables are unsecured creditors and receive little protection in any suit for recovery of damages where a buyer has failed to make payment as required by the contract.11

Protection Through a Nonsegregated, Floating Trust

In response to the perceived inequity to suppliers created by the financing arrangements between produce purchasers and their lenders, PACA was considerably strengthened through amendments in 1984 that added a trust requirement benefitting produce suppliers. The trust provision in 7 U.S.C. §499e(c)(2) states, in relevant part:

Perishable agricultural commodities received by a commission merchant, dealer or broker in all transactions, and all inventories of food or other products derived from perishable agricultural commodities, and any receivables or proceeds from the sale of such commodities or products, shall be held by such commission merchant, dealer or broker in trust for the benefit of all unpaid suppliers or sellers of such commodities or agents involved in the transaction, until full payment of the sums owing in connection with such transactions has been received by such unpaid suppliers, sellers or agents.12

The supplier holds a beneficial interest in the trust from the moment the perishable goods are delivered to the buyer and continues to hold the interest until the claim is either paid in full or the supplier fails to preserve its interest in the trust.13

In order to receive the benefit of a PACA trust, the produce supplier cannot agree to payment terms beyond 30 days from the receipt and acceptance of the perishable commodities.14 A produce supplier can further lose trust benefits if he or she fails to provide timely notice of intent to preserve the trust to the produce buyer and the Secretary of Agriculture.15 Amendments to PACA in 1995 provide that an alternate form of notice of intent to preserve the trust may be given through an invoice or billing statement containing certain language described in the statute.16

The PACA trust is a nonsegregated floating trust that exists for the benefit of the sellers and suppliers of perishable agricultural commodities.17 In a further attempt to protect produce suppliers, beneficiaries are not required to trace their assets in order to maintain the trust. The regulations supporting PACA provide as follows:

The trust is made up of perishable agricultural commodities received in all transactions, all inventories of food or other products derived from such perishable agricultural commodities, and all receivables or proceeds from the sale of such commodities and food or products derived therefrom. Trust assets are to be preserved as a non-segregated "floating" trust. Commingling of trust assets is contemplated.18

Therefore, once a producer establishes itself to be a PACA trust beneficiary and provides the requisite notice, the PACA trust floats "over not only the debtor's perishable commodities, but also products made from them and the accounts receivable and proceeds from them... The term 'floating' extends the trust to all produce-related inventory, receivables and proceeds of the debtor-dealer, regardless of origin or destination, to satisfy a PACA trust res."19 In other words, it is not necessary for trust beneficiaries to link the trust fund to the produce they supplied since the trust "applies to all of [the purchaser/debtor's] produce-related inventory and proceeds thereof, regardless of whether [one supplier] or another produce supplier was the source of such inventory."20

Furthermore, trusts created under PACA are governed by general trust law principles and therefore the PACA trust is not actually considered property of the bankruptcy estate.21 In the bankruptcy context, the effect of the 1984 non-segregated, floating trust provision is to give the produce suppliers, who are the beneficiaries of PACA trusts, a superpriority right to payment from a purchaser who subsequently files for bankruptcy. In other words, the rights of PACA trust beneficiaries (i.e., growers and suppliers) to payment are superior to the rights of the purchaser's secured creditors.22

By creating the trust provision, Congress has preferred one class of creditors—perishable food growers and suppliers—to almost all others. This powerful deference to a "special interest" has been criticized for undermining not only "the rights of general unsecured creditors, but also the concept of a unitary, self-contained Bankruptcy Code."23 However, as a matter of policy, Congress determined "it would be less disastrous to risk the liquidation of a single purchaser than to threaten the entire production chain with insolvency."24

Violation of the Trust Requirement and Personal Liability

A PACA trust is violated if a purchaser, either through action or inaction, fails to keep the trust assets readily available to suppliers. The PACA regulations provide in pertinent part as follows:

(1) Commission merchants, dealers and brokers are required to maintain trust assets in a manner that such assets are freely available to satisfy outstanding obligations to sellers of perishable agricultural commodities. Any act or omission which is inconsistent with this responsibility, including dissipation of trust assets, is unlawful and in violation of section 2 of the Act, (7 U.S.C. §499b).25

Thus, the trust obligation may be violated even when the trust funds, namely proceeds from the sale of perishable agricultural commodities, are used to pay legitimate business expenses, such as rent.26

In certain circumstances, PACA allows suppliers to reach beyond corporate coffers and into the pockets of individual shareholders and directors for repayment of delinquent accounts. Courts have found that "PACA liability attaches first to the licenced commission merchant, dealer or broker of perishable commodities," but if "the assets...are insufficient to satisfy the PACA liability, then others may be held secondarily liable if they had some role in causing the corporate trustee to commit the breach of trust."27 Therefore, a purchaser's failure, either through act or omission, to maintain trust assets consistent with the regulations may result in personal liability for those in positions of control, such as a corporation's officers, directors or shareholders.28 A key question in determining individual liability is whether the person is in a position to control trust assets.29

As discussed further below, many courts have interpreted the PACA trust requirement as imposing a type of strict liability on individuals in control of trust assets. Simply put, an inability to pay PACA trust beneficiaries, without other evidence of wrongdoing, may be enough to create personal liability.

The case of Weis-Buy Services Inc. v. Paglia provides an example of how a personal liability action arises.30 In Weis-Buy, a corporate purchaser of perishable agricultural commodities filed for bankruptcy and ceased operations.31 Certain perishable produce suppliers received a partial distribution of the estate's assets after the bankruptcy court determined they had valid PACA claims.32 After receiving such partial distribution, the produce suppliers sued a retired shareholder (hereinafter the shareholder) in district court for the remainder owed to them, alleging breach of fiduciary duty under PACA.33 The background of the shareholder subjected to liability in Weis-Buy is instructive on the potential reach of the PACA trust provisions. The shareholder, who became involved in the company started by his father in 1914, sold the business in the 1980s, yet remained an employee and eventually repurchased shares.34 He retired from the company shortly before the beginning of the business relationship between the debtor company and the produce sellers who sued him for violation of the trust.35 However, the shareholder still had significant ties with the debtor company after he retired: At the time of the bankruptcy in December 1997, he was a 25 percent shareholder, an officer who retained his title of vice-president and a signatory on the company's bank accounts.36

The district court found the shareholder liable, entered judgment in favor of the produce suppliers and further awarded them interest and attorney's fees.37 Although the Third Circuit Court of Appeals ultimately found that the action against the shareholder was barred by the statute of limitations,38 the court specifically held that "individual officers and shareholders, in certain circumstances, may be held individually liable for breaching their fiduciary duties under PACA."39 A compelling point highlighted by Weis-Buy, and similar decisions from other circuits, is that "[a]n investor in a perishable commodities corporation 'should know at the beginning of his association with such a corporation that he is buying into' a corporation which is strictly regulated by the federal government through PACA."40

The cause of action for individual liability is an action in tort for breach of fiduciary duty. While the cause of action arises under the PACA statute, general trust law principles apply: "[i]ndividual liability in the PACA context is not derived from the statutory language, but from common law breach-of-trust principles."41 The imposition of personal liability for violation of a PACA trust has been distinguished from the doctrine of piercing the corporate veil as described by the court in Morris Okun, Inc. v. Harry Zimmerman Inc. as follows:

This trust arises from the moment perishable goods are delivered by the seller. An individual who is in the position to control the trust assets and who does not preserve them for the beneficiaries has breached a fiduciary duty, and is personally liable for that tortious act. This legal framework is to be distinguished from the piercing-the-veil doctrine, where the corporate form is disregarded because the individual has either committed a fraud, or because the corporation is a "shell" being used by the individual shareholders to advance their own purely personal rather than corporate ends.42

Some courts have interpreted PACA differently on the issue of individual liability. In refusing to find the president and sole shareholder personally liable for breach of his fiduciary duty to suppliers, the District Court for the Eastern District of Tennessee in Farm-Wey Produce Inc. v. Wayne L. Bowman Inc. stated that "there is no indication in the statute itself, the associated regulations or the legislative history that Congress intended to abrogate substantial portions of state corporation and contract law by making a large class of individuals sureties on the contracts of produce buyers."43 The court further stated:

Certainly the intent of PACA is that produce suppliers be paid first, and in full, before other secured creditors. The regulations are equally clear that any act in derogation of this duty should be construed as a violation of PACA.... However, if Congress intended to ease a burden on commerce created by the phenomenon whereby creditor banks supplying operating capital for produce brokers have bankruptcy priority over produce sellers, it is unlikely that it intended to replace that burden with the burden which would result from the rule sought by plaintiffs. As a practical matter, the corporate form would be meaningless for produce brokers. Shareholders, officers, directors and even mere employees would risk personal liability for huge debts. Any financial reversal of a company could mean instant personal ruin for practically anyone associated with that corporation. Under those circumstances, few would wish to be associated with a broker that did business on anything other than a cash basis.44

The Farm-Wey court, rejecting the "strict liability" approach, was reluctant to find the owner of the purchaser company personally liable without finding any wrongdoing on his part other than the company's inability to pay.45 Specifically, the court did not find that the company or its president committed any fraud or unfair practice; "[r]ather, they were the second 'domino' in the chain when their own customers... defaulted."46 The court observed that:

[i]f an individual is licensed and commits PACA violations, he may have his license revoked or suspended. If an individual is responsibly connected to a company that violates PACA, he may be barred from employment with a PACA licensee. Nothing in the statutory language suggests that individuals who are associated with companies in the perishables trade should be in constant fear of losing their life savings for operating a business responsibly.47

The Farm-Wey court's argument may be compelling, but many courts have reached contrary findings. In Consumers Produce Co. v. M & T Chirico Inc., for example, the court found that "[b]y overwhelming majority, the courts have held that PACA imposes individual liability on corporate officers, shareholders or other persons in the position to control the trust assets for repayment of amounts due to the supplier. This includes every circuit court to have addressed the well as virtually every district within the Second Circuit."48

In Consumers Produce, the defendants requested that they not be held responsible for proceeds that the defendants themselves were owed from their sale of the produce to third-party purchasers. The court declined their request and rejected the defendants' reliance on Farm-Wey.49 The court found that "PACA's regulatory scheme imposes personal liability upon individual corporate officers for dissipation of PACA trust assets regardless of the inability to collect proceeds from the resale of the commodities."50 The court further stated that "[t]he fact that [the corporation] attempted but failed to collect this money does not satisfy its duty to plaintiffs."51

Courts imposing individual liability appear to do so with the belief that it is the only way to carry out Congress's intentions. As the District Court for the Middle District of Florida in Red's Market v. Cape Canaveral Cruise Line Inc. found:

The extension of liability to those in control of the trust assets is reasonable and necessary in order to enforce the goals of Congress in establishing the statutory trust. If liability were limited to corporate dealers, the intent of the federal statute to protect consumers and sellers of produce would be easily frustrated.52

Thus, the extension of PACA trust liability to individuals provides additional assurance that suppliers of perishable commodities will be paid.


PACA gives produce suppliers powerful protections that impact lenders' interests and give members of companies that purchase perishable food substantially increased exposure to liability. The protections PACA gives suppliers appear to be at odds with the principles of bankruptcy law regarding property of the estate and distribution priorities. Furthermore, PACA arguably challenges the spirit of the Code's offer of relief to the honest debtor. However, through PACA's trust requirement, Congress has accomplished its goal of providing an effective tool for produce suppliers to receive compensation for their deliveries of perishable foods.


1 PACA is codified in 7 U.S.C. §499(a)-(s) (2000).

2 PACA's definition of the term "perishable agricultural commodity"— (A) means any of the following, whether or not frozen or packed in ice: fresh fruits and fresh vegetables of every kind and character; and (B) includes cherries in brine as defined by the Secretary in accordance with trade usages." 7 U.S.C. §499a(b)(4) (2000).

3 In this article the terms "supplier" and "grower" refer to entities that supply perishable agricultural commodities and the terms "buyer" and "purchaser" refer to the "commission merchants" "dealers" and "brokers" who receive the perishable commodities, as those terms are defined in 7 U.S.C. §499a(b)(5)-(7) (2000).

4 "The term 'person' includes individuals, partnerships, corporations and associations." 7 U.S.C. §499a(b)(1) (2000). A "commission merchant" is "any person engaged in the business of receiving in interstate or foreign commerce any perishable agricultural commodity for sale, on commission, or for or on behalf of another." 7 U.S.C. §499a(b)(5) (2000). Generally, a "dealer" is defined as "any person engaged in the business of buying or selling in wholesale or jobbing quantities as defined by the Secretary [of Agriculture], any perishable agricultural commodity in interstate or foreign commerce...." 7 U.S.C. §499a(b)(6) (2000). However, "no person buying any such commodity solely for sale at retail shall be considered as a 'dealer' until the invoice cost of his [or her] purchases of perishable agricultural commodities in any calendar year are in excess of $230,000...." Id. The term "dealer" has also been applied to restaurants in certain circumstances. See In re Magic Restaurants Inc., 205 F.3d 108, 117 (3d Cir. 2000). A "broker" is " any person engaged in the business of negotiating sales and purchases of any perishable agricultural commodity in interstate or foreign commerce for or on behalf of the vendor or the purchaser, respectively, except that no person shall be deemed to be a 'broker' if such person is an independent agent negotiating sales for and on behalf of the vendor and if the only sales of such commodities negotiated by such person are sales of frozen fruits and vegetables having an invoice value not in excess of $230,000 in any calendar year." 7 U.S.C. §499a(b)(7) (2000).

5 In re Kornblum & Co., 81 F.3d 280, 283 (2d Cir. 1996) (quoting H.R. Rep. No. 1196, 84th Cong., 1st Sess. 2 (1955), reprinted in 1956 U.S.C.C.A.N. 3699, 3701).

6 See George Steinberg & Son Inc. v. Butz, 491 F.2d 988, 990 (2d Cir. 1974) ("upon receiving a shipment of perishable commodities, the commission merchants, dealers and brokers would wrongfully reject the shipment, in many cases making the false claim that the commodities had arrived in a damaged condition or some other claim permitting rejection of the shipment. These fraudulent rejections were made when the market for the commodity was declining so that the commission merchant, dealer or broker would have suffered a loss had he accepted the shipment and paid the contract price").

7 Zwick v. Freeman, 373 F.2d 110, 116 (2d Cir. 1967) (citing H.R. Rep. No.84-1196, 84th Cong.,1st Sess. 2 (1955), reprinted in 1956 U.S.C.C.A.N. 3699, 3701). Initially, PACA consisted of licensing requirements for purchasers and a list of unlawful conduct and penalty provisions for violations of the statute. PACA specifically prohibits purchasers from engaging in conduct such as using deceptive practices in determining the quantity of perishable produce, rejecting the produce without reasonable cause, misrepresenting the quality or condition of the produce, discarding the produce without reasonable cause or failing to "make full payment promptly." See 7 U.S.C. §499b (2000).

8 See H.R. Rep. No. 98-543, 98th Cong., 1st Sess. 3 (1983), reprinted in 1984 U.S.C.C.A.N. 405, 406-07.

9 H.R. Rep. No. 98-543, 98th Cong., 1st Sess. 5 (1983), reprinted in 1984 U.S.C.C.A.N. 405, 406.

10 See Am. Banana Co. v. Rep. Nat'l. Bank of N.Y., 362 F.3d 33, 37 (2d Cir. 2004); C.H. Robinson Co. v. B.H. Produce Co., 723 F.Supp. 785, 791 (N.D. Ga. 1989), aff'd., 952 F.2d 1311 (11th Cir. 1992).

11 H.R. Rep. No. 98-543, 98th Cong., 1st Sess. 3 (1983), reprinted in 1984 U.S.C.C.A.N. 405, 407); See, also, 7 U.S.C. §499e(c)(1) (2000).

12 7 U.S.C. §499e(c)(2) (2000). It should be noted that the trust provisions do not apply to "transactions between a cooperative association, as defined in 1141j(a) of Title 12, and its members." Id. See, generally, Cardonick, Andrew R., "Let the Lender Beware The Perishable Agricultural Commodities Act," 58 The Secured Lender, 16 (2002), for a discussion on of assets subject to a PACA trust.

13 See 7 C.F.R. §46.46(c) (2006).

14 7 C.F.R. §46.46(e)(2) (2006); See Bocchi Americas Assocs. Inc. v. Commerce Fresh Marketing Inc., No. Civ.A. H0402411, 2005 WL 3164240, at *3 (S.D. Tex. Nov. 28, 2005). But see Cardonick, Andrew R., "Let the Lender Beware The Perishable Agricultural Commodities Act," 58 The Secured Lender, 16 (2002) (describing the split between courts as to strict or liberal enforcement of the 30-day requirement).

15 As the Second Circuit Court of Appeals described in D.M. Rothman & Co. v. Korea Commercial Bank of N.Y., 411 F.3d 90, 96 (2d Cir. 2005), "although a PACA trust is automatically established each time a broker or merchant purchases perishable commodities upon credit, a particular grower or seller of perishable commodities will not be entitled to PACA protection for any nonpayment claims unless it perfects its claims within 40 days after the payment was due by sending a notice of intent to preserve PACA trust benefits to both the Department of Agriculture (USDA) and the particular commodities broker alleged to have violated PACA." See 7 U.S.C. §499e(c)(3) and (4) (2000); 7 C.F.R. §46.46(f)(1)-(3) (2006).

16 7 U.S.C. §499(e)(c)(4) (2000); 7 C.F.R. §46.46(f)(3) (2006).

17 7 U.S.C. §499e(c)(2) (2000); 7 C.F.R. §46.46(b),(c) (2006).

18 7 C.F.R. §46.46(b) (2006).

19 In re H.R. Hindle & Co., 149 B.R. 775, 784 (Bankr. E.D. Pa. 1993) (internal citations omitted).

20 In re Fresh Approach Inc., 51 B.R. 412, 422 (Bankr. N.D. Tex. 1985) (citations omitted) (emphasis in original).

21 Sunkist Growers Inc. v. Fisher, 104 F.3d 280, 282 (9th Cir. 1997).

22 E. Armata v. Korea Commercial Bank of New York, 367 F.3d 123, 128 (2d Cir. 2004) ("the trust provides PACA creditors with 'a right to recover against the purchasers superior to all creditors, including secured creditors,'" quoting Endico Potatoes Inc. v C.I.T. Group/Factoring Inc., 67 F.3d 1063, 1067 (2d Cir. 1995)); In re Lombardo Fruit & Produce Co., 12 F.3d 806, 809 (PACA's trust provision has the precise effect Congress intended; namely, in the event the seller does not receive payment, the seller is elevated to a priority position above that of all the buyer's secured creditors"). Lenders to businesses that purchase perishable food, in addition to losing some priority status to the superior rights of PACA suppliers, also face the prospect of violating the PACA trust themselves through accepting payments from a violating purchaser. For a discussion on how lenders may be able to protect their rights through use of the "bona fide purchaser" defense among other methods, see, generally, Freedman, Terri Jane, et. al., "Secured Creditors May Not Be as Secure as They Think: Understanding a Lender's Rights under the Perishable Agricultural Commodities Act," 175 N.J. L. J. 1086 (March 15, 2004).

23 In re H.R. Hindle, 149 B.R. at 785.

24 In re Fresh Approach, 51 B.R. at 420.

25 7 C.F.R. §46.46(d) (2006).

26 Morris Okun Inc. v. Harry Zimmerman Inc., 814 F. Supp. 346, 348 (S.D.N.Y. 1993). Contra, Farm-Wey Produce Inc. v. Wayne L. Bowman Inc., 973 F.Supp. 778, 784 (finding that payment of incidental business expenses did not amount to breach of fiduciary duty under PACA); accord, In re Bear Kodiak Produce Inc., 283 B.R. 577, 587 (Bankr. D. Ariz. 2002) ("this court concurs with the rationale of the district court in Farm-Wey... Congress did not intend to fashion a scheme which would impose strict secondary liability on a PACA buyer's officers and shareholders for authorizing ordinary-course business payments to employees and other creditors; there must be some outward limit on a supplier's ability to collect its debts").

27 Golman-Hayden Co. v. Fresh Source Produce Inc., 217 F.3d 348, 351 (5th Cir. 2000) (citing Sunkist Growers Inc. v. Fisher, 104 F.3d 280, 283 (9th Cir. 1997)).

28 Id.

29 Id. See, also, Sunkist Growers Inc. v. Fisher, 104 F.3d 280, 283 (9th Cir. 1997) (citing Frio Ice v. SunFruit Inc., 724 F.Supp. 1373, 1382 (S.D. Fla. 1989)), rev'd. on other grounds, 918 F.2d 154 (11th Cir. 1990)) ("a court considering the liability of the individual may look at 'the closely-held nature of the corporation, the individual's active management role' and any evidence of the individual's acting for the corporation").

30 Weis-Buy Servs. Inc. v. Paglia, 411 F.3d 415 (3d Cir. 2005).

31 Id. at 419.

32 Id.

33 Id.

34 Id. at 418.

35 Id. at 418-19.

36 Id. at 418.

37 Id. at 419.

38 Id. at 422-25.

39 Id. at 421. However, the Third Circuit in Weis-Buy specifically stated that "while we have indicated our agreement that there are circumstances under which officers may be held individually liable for breaching their fiduciary duties arising from a PACA trust, we express no opinion about the correctness of the district court's conclusion that [the defendant's] activities were enough to establish individual liability under the facts in this case." Id. at 425 n.6.

40 Id. at 421 (quoting Golman-Hayden, 217 F.3d 348, 351 (5th Cir. 2000)).

41 Id. at 421 (citing Sunkist Growers Inc. v. Fisher, 104 F.3d 280, 282 (9th Cir. 1997)).

42 Morris Okun Inc. v. Harry Zimmerman Inc., 814 F.Supp. 346, 348 (S.D.N.Y. 1993). As the Golman-Hayden court noted, "while individuals generally are not held responsible for the liabilities of a corporation, we recognize that a corporation can act only through its agents and can fulfill fiduciary obligations only through its agents." Id. at 351 n.18.

43 Farm-Wey Produce Inc. v. Wayne L. Bowman Inc., 973 F.Supp. 778, 782-83 (E.D. Tenn. 1997).

44 Id. at 783 (internal citation omitted).

45 Id. at 783-84.

46 Id. at 785.

47 Id. at 784.

48 Consumers Produce Co. v. M & T Chirico Inc., No. 04-CV-295C (SR), 2005 WL 2420355, at *2 (W.D.N.Y. Sept. 30, 2005) (citations omitted).

49 Id. at *3.

50 Id. (citing Bronia Inc. v. Ho, 873 F.Supp. 854 (S.D.N.Y. 1995)).

51 Id. (quoting Bronia, 873 F.Supp at 860-61).

52 Red's Market v. Cape Canaveral Cruise Line Inc., 181 F.Supp. 2d 1339, 1343 (M.D. Fla. 2002).

Journal Date: 
Monday, May 1, 2006