The opinion
UNITED STATES DISTRICT COURT May 06, 2020
SOUTHERN DISTRICT OF TEXAS David J. Bradley, Clerk
MCALLEN DIVISION
AGUACATES SELECCIONADOS JBR §
USA, LLC, §
§
Plaintiff, §
VS. § CIVIL ACTION NO. 7:19-CV-338
§
BUCKS FRESH PRODUCE, LLC, et al, §
§
Defendants. §
OPINION & ORDER
The Court now considers the “Motion for Default Judgment Against Defendants”1 filed
by Aguacates Seleccionados JBR USA, LLC (“Plaintiff”) against Bucks Fresh Produce, LLC
(“Defendant BFP”); Christopher Torres, Individually (“Defendant Christopher Torres”);
Christopher Torres, as Co-Trustee of C&D Holdings, a Revocable Trust; Diana De Jesus Flores
Cavazos, a/k/a Diana Torres, Individually (“Defendant Diana Torres”); and Diana De Jesus
Flores Cavazos a/k/a Diana Torres, as Co-Trustee of C&D Holdings, a Revocable Trust
(hereafter, collectively, “Defendants”). After duly considering the record and relevant
authorities, the Court GRANTS IN PART and DENIES IN PART Plaintiff’s motion.
I. BACKGROUND
Plaintiff brings this suit under the Perishable Agricultural Commodities Act, 1930
(“PACA”) for breach of a series of produce contracts.2 Plaintiff and Defendant BFP are both
“dealers” that engage in the business of buying and selling wholesale quantities of perishable
1 Dkt. No. 15.
2 Dkt. No. 1 at 1, ¶ 1.
agricultural commodities in interstate commerce and are licensed under PACA.3 Both Plaintiff
and Defendant BFP have principal places of business in McAllen, Texas.4 Plaintiff alleges
Defendants Christopher and Diana Torres are “officer[s], directors[s], shareholder[s], member[s],
and/or manager[s]” of Defendant BFP.5 Plaintiff is suing Defendants Christopher Torres and
Diana Torres in both their individual capacities, and their capacities as co-trustees of C&D
Holdings, a revocable trust.
In essence, Plaintiff now seeks to recover $610,960.00, the amount unpaid by Defendants
on various invoices for produce sold to Defendant BFP between October 2, 2017 and January 8,
2018.6 Plaintiff alleges that between October 2, 2017 and January 8, 2018, Plaintiff “sold and
shipped to [Defendant BFP] at [Defendant BFP’s] request, perishable agricultural commodities
for agreed upon selling prices.”7 While Plaintiff does not provide the details of the parties’
transactions, Plaintiff appears to allege that Defendants Christopher and Diana Torres, acting on
behalf of Defendant BFP, agreed to purchase the produce.8 Plaintiff further alleges that
“Defendants accepted said shipments”9 and failed to remit any payments, even after Plaintiff sent
all invoices to Defendant BFP and “repeatedly demanded that [Defendant BFP] pay the sums
3 Id. at 2, ¶¶ 4–5. A dealer under PACA is defined as “any person engaged in the business of buying or selling in
wholesale or jobbing quantities . . . any perishable agricultural commodity in interstate or foreign commerce.” 7
U.S.C. § 499(a). A person or entity is also a dealer under PACA if they are properly licensed pursuant to Section
499c of the statute. Id.
4 Dkt. No. 1 at 2, ¶¶ 4–5.
5 Id. at 2–3, ¶¶ 6–7. Plaintiff provides that Defendants Christopher and Diana Torres “at all times herein were
insiders with actual and constructive knowledge of the PACA trust and the provisions set forth therein and were
responsible for the daily management and control of [Defendant BFP]” Id. at 3, ¶ 8.
6 Dkt. No. 15 at 2, ¶ 4.
7 Dkt. No. 1 at 3, ¶ 10.
8 Plaintiff does not specifically allege that Defendants Christopher and Diana Torres agreed to the produce
transactions themselves or that they accepted shipment on behalf of Defendant BFP. However, Plaintiff seems to
imply as such when it discusses the relationship between Defendant Christopher and Diana Torres and Defendant
BFP as it pertains to PACA. For example, in the complaint Plaintiff provides that Defendants Christopher and Diana
Torres “held themselves out publicly to be principals of [Defendant BFP] as stated on [Defendant BFP’s] PACA
licenses issued by the U.S. Department of Agriculture and were statutory trustees under the PACA in positions to
control the PACA trust assets that are the subject of this lawsuit.” Id. at 3, ¶ 9.
9 Id. at 3, ¶ 10.
that are due and owing under these invoices.”10 Plaintiff attaches the invoices for the Court’s
review, which demonstrate multiple shipments of avocados.11
On July 9, 2018, after Defendants allegedly failed to remit payment, Plaintiff initiated a
formal complaint with the U.S. Department of Agriculture (“USDA”) seeking to recover the
sums owed under PACA.12 On December 11, 2018, the parties entered into a Settlement
Agreement and Stipulation for Entry of Judgment (hereafter, “Agreement”), which Plaintiff
attaches for the Court’s review.13 The Agreement is signed by all Defendants, including
Defendants Christopher and Diana Torres in their individual capacities and their capacities as co-
trustees of C&D Holdings.14 Therein, Defendants stipulate to the facts as described in this
Order.15 In order to “avoid the further expense and uncertainty of litigation,” Defendants agreed
to remit a settlement amount totaling $605,040.00 in installments to be paid to Plaintiff on
specified dates.16 Defendants’ first payment under the Agreement for $25,000.00 was due to
Plaintiff on January 15, 2019.17
In the Agreement, Plaintiff does not agree to settle all disputes or forego future claims
against Defendants. Rather, Plaintiff agrees to dismiss the formal USDA complaint against
Defendants “without prejudice, subject to reopening to enforce or interpret this Agreement and
or to enter and enforce the judgment contemplated” by the Agreement.18 The Agreement
10 Id. at 4, ¶¶ 13–14.
11 See generally Dkt. No. 15-8.
12 Dkt. No. 1 at–5, ¶ 19.
13 See Dkt. No. 15-12.
14 Id. at 11.
15 Id. at 3, ¶¶ iv–xii.
16 Id. at 4–5, ¶¶ 1–5. Pursuant to the Agreement, the total settlement amount of $605,040.00 “is comprised of the
undisputed principal amount of $595,040.00, plus $20,000.00 in attorney’s fees, plus interest at 18% per annum.” Id.
at 4, ¶ 3. Defendants were required to pay monthly payments of $25,000.00 from January 15, 2019 to April 15,
2019; a payment of $50,000.00 by May 15, 2019; a payment of $75,000.00 by June 15, 2019; monthly payments of
$80,000.00 from July 15, 2019 to September 15, 2019; monthly payments of $40,000.00 from October 15, 2019 to
May 15, 2020; and a final payment of $38,960.64 by June 15, 2020. Id. at 3–4, ¶ 4.
17 Id. at 4, ¶ 4(a).
18 Id. at 6, ¶ 11.
provides that “[n]othing in this Agreement shall be deemed a waiver or limitation of any rights
[Plaintiff] may have under PACA. . .” The Agreement further specifies that Plaintiff’s
willingness to accept the payments owed by Defendants in installments “does not in any way
vitiate or diminish the PACA trust rights [Plaintiff] is entitled to assert against [Defendants].”19
In the event Defendants were to default under the Agreement, Defendants agreed to allow
joint and several judgment to be entered against them in a United States District Court for the
Southern District of Texas on an ex parte basis, for the settlement amount of $605,040.00 plus
pre-judgment and post-judgment interest at 18% annum, filing fees, attorneys’ fees, and any
additional fees and costs incurred in obtaining and enforcing said judgment.20
The Agreement also provides that should Defendants default on its terms, the Agreement
is secured by Defendants’ assets, which are more specifically described in the Agreement and
include “the Texas Warehouse and Mexico Farmland.”21 Plaintiff alleges that in addition to the
Agreement, Defendants executed a Deed of Trust on two properties: one in McAllen, Texas,
presumably the “Texas Warehouse;” and one in Saltillo, Mexico, presumably the “Mexico
Farmland.”22 However, Plaintiff only attaches a Deed of Trust evidencing a conveyance of the
McAllen property.23 The Deed of Trust for the McAllen property was recorded in the Official
19 Id.
20 See id. at 6, ¶ 8.
21 Id. ¶ 10.
22 Id. at 6–7, ¶ 10; see Dkt. No. 15-13 (Deed of Trust).
23 Plaintiff provides in the complaint that the Deed of Trust is “on certain real property located at 2501 West
Military Highway, Suite A18, McAllen, Texas 78503 and fraccion “B” del lote de terreno ubicado en la ex Hacienda
de Encarnacion de Guzman, municipality of Saltillo, Mexico.” Dkt. No. 1 at 12, ¶¶ 64–66. However, the attached
Deed of Trust only addresses a property in McAllen, Texas. See Dkt. No. 15-13 at 3. Even then, the Deed of Trust
itself does not explicitly provide that this property as described is located at the address provided by Plaintiff: 2501
West Military Highway, Suite A18, McAllen, Texas 78503. Dkt. No. 1 at 12, ¶¶ 64–66. Rather, the Deed of Trust
identifies the property as “Unit 18, Building A, McAllen produce Terminal Market, Phase I, a Condominium
Regime established under Condominium Declaration, dated September 27, 1993, filed October 12, 1993 under
Clerk’s File No. 347782, Amendments filed April 2, 2002 under Document Number 1067579; filed May 15, 2006
under Document Number 1615515 and filed January 11, 2008 under Document Number 1844747, all in the Official
Records of Hidalgo County, Texas, together with the undivided interest in and to the common elements of said land
and premises, said Market, an addition to the City of McAllen, Hidalgo County, Texas reference to which is here
Records of Hidalgo County.24 Therein, Defendants named Plaintiff as the beneficiary and
conveyed the McAllen property to Atlas, Hall & Rodriguez LLP, the law firm representing
Plaintiff, as trustee.25 The Deed of Trust provides that should Defendants default on the
Agreement, the trustee may foreclose on the property and sell the property at auction, with the
proceeds going to Plaintiff as the beneficiary.26 Like the Agreement, the Deed of Trust is signed
by all Defendants.27
Plaintiff alleges that Defendants failed to remit the first January 15, 2019 payment.28
Plaintiff sent Defendants notice of default on January 16, 2019.29 As of December 9, 2019,
Plaintiff maintains that Defendants have not remitted any payments to Plaintiff pursuant to the
Agreement, and that the principal amount due on the invoices – $610,960.00 – remains unpaid.30
Plaintiff filed its complaint in this Court on September 25, 2019, bringing claims for
multiple PACA violations against all Defendants.31 Plaintiff also brings PACA claims against
Defendants Christopher and Diana Torres, solely in their individual capacities, for breach of
fiduciary duty and conversion and unlawful retention of PACA trust assets.32 Plaintiff brings a
made for all purposes.” Dkt. No. 15-13. at 3. it As such, based on Plaintiff’s pleadings, the Court assumes that the
property as described in the Deed of Trust is 2501 West Military Highway, Suite A18, McAllen, Texas 78503. See
Dkt. No. 1 at 12, ¶ 64; see also Dkt. No. 15-13 at 3. There is no Deed of Trust on the record addressing the property
in Mexico.
24 Plaintiff provides that the “Deed of Trust was executed on December 11, 2018 and recorded in the Official
Records of Hidalgo County, Texas on December 27, 2018 as document 2975332.” Dkt. No. 1 at 12, ¶ 65. This
matches the notarization date on the Deed of Trust and the recording receipt attached by Plaintiff. See Dkt. No. 15-
12 at 11; see also Dkt. No. 15-13.
25 Dkt. No. 15-13 at 1.
26 Id. at 5.
27 Id. at 9–11.
28 Dkt. No. 1 at 5, ¶¶ 21–24.
29 Dkt. No. 15-14.
30 Dkt. No. 12 at 5–6, ¶¶ 23–26.
31 Dkt. No. 1 at 5–10, ¶¶ 25–46. Plaintiff brings claims against all Defendants for “Enforcement of Statutory Trust
Provisions of PACA,” pursuant to 7 U.S.C. § 499e(c)(1)-(4) (Id. at 5–7, ¶¶ 25–33); Violation of the PACA: Failure
to Maintain PACA Trust Assets Against All Defendants,” pursuant to 7 U.S.C. § 499b(4) (Id. at 7–8, ¶¶ 34–38); and
“Breach of Duty to Pay Under the PACA,” pursuant to 7 U.S.C. § 499b(4) (Id. at 8–10, ¶¶ 39–46).
32 Dkt. No. 1 at 10–12, ¶¶ 47–62. Plaintiff refers to Defendants Christopher and Diana Torres in their individual
capacities as “C. Torres” and D. Torres” in the complaint. Id. at 1. Plaintiff’s claims for breach of fiduciary duty and
conversion and unlawful retention of PACA trust assets are brought against “D. Torres” and “C Torres.” See id. at
single breach of contract claim against Defendant BFP for breach of the parties’ original
contracts for the shipment of produce.33 On these claims, Plaintiff requests damages in the
amount of $610,960.00; pre-judgment and post-judgment interest; and attorneys’ fees and
costs.34 Finally, Plaintiff brings a cause of action against Defendants for “foreclosure” pursuant
to the terms of the Agreement and Deed of Trust. On this claim, Plaintiff requests attorneys’ fees
and costs and an Order of Sale.35
All Defendants were served with process on October 5, 2019.36 After Defendants did not
appear or answer within the time provided by the Federal Rules of Civil Procedure, Plaintiff
moved for entry of default.37 The Court granted Plaintiff’s motion for entry of default38 and the
Clerk of the Court entered default against Defendants on November 21, 2019.39 To date,
Defendants have not appeared or answered. Plaintiff filed the instant motion for default judgment
on December 9, 2019.40 The Court now turns to its analysis.
II. ANALYSIS
a. Legal Standard
Obtaining an entry of default judgment is a three-step process: (1) default by the
defendant; (2) entry of default by the Clerk of Court; and (3) entry of a default judgment.41 Here,
Defendants have defaulted by failing to answer or otherwise appear in this case. Thus, entry of
10–12, ¶¶ 47–62. Accordingly, the Court notes that these claims are only brought against Defendant Christopher and
Diana Torres in their individual capacities.
33 Dkt. No. 1 at 3–5, ¶¶ 10-24.
34 Id. at 13–15.
35 Id. at 12–13, ¶¶ 63–70; Id. at 15, ¶ 1.
36 Dkt. Nos. 6–10.
37 Dkt. No. 12; FED. R. CIV. P. 12(a)(1)(A)(i) (providing Defendants twenty-one days from the date of service to
answer).
38 Dkt. No. 13.
39 Dkt. No. 14.
40 Dkt. No. 15.
41 Bieler v. HP Debt Exch., LLC, 2013 WL 3283722, at *2 (N.D. Tex. June 28, 2013) (citing New York Life Ins. Co.
v. Brown, 84 F.3d 137, 141 (5th Cir.1996)).
default has been made against them by the Clerk of Court.42 The only remaining question is
whether the third step—actual entry of default judgment—is appropriate.
Federal Rule of Civil Procedure (“Rule”) 55(b) authorizes entry of default judgment with
court approval. It is a drastic remedy, resorted to only in extreme situations.43 Nevertheless,
default judgment determinations are left to the sound discretion of the district court.44
Determining the propriety of default judgment is itself a three-step process. First, the Court must
determine if default judgment is procedurally proper, countenancing six factors:
(1) whether material issues of fact are at issue; (2) whether there has been
substantial prejudice; (3) whether grounds for default are clearly established; (4)
whether default was caused by good faith mistake or excusable neglect; (5) the
harshness of the default judgment; and (6) whether the court would feel obligated
to set aside a default on the defendant’s motion.45
Second, if default judgment is procedurally proper, the Court must determine whether the
plaintiff’s claims are substantively meritorious.46 After all, a defendant’s failure to answer or
otherwise defend does not mean the particular legal claims levied against him are valid.47 When
analyzing the merits of a claim, courts may assume the truth of all well-pled allegations in the
plaintiff’s complaint.48 Third, if the plaintiff’s claims are meritorious, the Court must determine
whether the requested relief is appropriate.49 In particular, Rule 54(c) dictates a default judgment
“must not differ in kind from, or exceed in amount, what is demanded in the pleadings.”50
If the Court determines default judgment is appropriate, it must determine how to
calculate damages. The general rule is “unliquidated damages normally are not awarded without
42 Dkt. No. 14.
43 Sun Bank of Ocala v. Pelican Homestead & Sav. Ass’n, 874 F.2d 274, 276 (5th Cir. 1989).
44 Mason v. Lister, 562 F.2d 343, 345 (5th Cir. 1977).
45 Bieler, 2013 WL 3283722, at *2 (citing Lindsey v. Prive Corp., 161 F.3d 886, 893 (5th Cir. 1998)).
46 Nishimatsu Const. Co., Ltd. v. Houston Nat. Bank, 515 F.2d 1200, 1206 (5th Cir. 1975).
47 See id.
48 Id.
49 United States v. 1998 Freightliner Vin #: 1FUYCZYB3WP886986, 548 F. Supp. 2d 381, 384 (W.D. Tex. 2008).
50 FED. R. CIV. P. 54(c).
an evidentiary hearing.”51 However, there is an exception when the amount claimed is “one
capable of mathematical calculation.”52 When this exception applies, there is no need for an
evidentiary hearing, and the court can enter default judgment on the briefing. The Court now
turns to its analysis.
b. Legal Analysis
i. Procedural Properness
Plaintiff shows default judgment is procedurally proper for each of its claims, as the
record does not reveal any material issues of fact. The grounds for default are clearly established,
as Defendants have not answered or appeared. There is no indication in the record that these
failures were somehow made in good faith or otherwise excusable, and for that reason, there is
no basis for the Court to expect it would be obligated, upon motion, to vacate default judgment
against Defendants as to any claim. Due to Defendants’ failure to answer or otherwise appear,
default judgment cannot—procedurally speaking—be properly characterized as unduly harsh or
prejudicial. For these reasons, default judgment is procedurally proper as to each of Plaintiff’s
claims against Defendants. The Court must now determine whether Plaintiff’s claims are
substantively meritorious.
ii. Substantive Merit
As an initial matter, the Court acknowledges that Plaintiff does not explicitly bring a
breach of contract claim for Defendants’ breach of the parties’ Agreement. Rather, Plaintiff
brings claims for violations of PACA and breach of the contracts for the sale of produce.53
51 Leedo Cabinetry v. James Sales & Distribution, Inc., 157 F.3d 410, 414 (5th Cir. 1998).
52 Id. (citing James v. Frame, 6 F.3d 307, 309–10 (5th Cir. 1993)).
53 Dkt. No. 1 at 3–13, ¶¶ 25–70. Plaintiff brings PACA claims against all Defendants for “Enforcement of Statutory
Trust Provisions of PACA,” pursuant to 7 U.S.C. § 499e(c)(1)-(4) (Id. at 5–7, ¶¶ 25–33); Violation of the PACA:
Failure to Maintain PACA Trust Assets Against All Defendants,” pursuant to 7 U.S.C. § 499b(4) (Id. at 7–8, ¶¶ 34–
38); and “Breach of Duty to Pay Under the PACA,” pursuant to 7 U.S.C. § 499b(4) (Id. at 8–10, ¶¶ 39–46). Plaintiff
Plaintiff requests the following relief for its PACA claims and breach of contract claim: damages
in the amount of $610,960.00; pre-judgment and post-judgment interest; and attorneys’ fees and
costs.54
Additionally, Plaintiff brings a separate claim for foreclosure and requests an Order of
Sale and attorneys’ fees and costs on the grounds that Defendants defaulted on the Agreement,
entitling Plaintiff to foreclose on Defendants’ property pursuant to the terms of the Agreement
and the Deed of Trust.55 Thus, the Court interprets Plaintiff’s foreclosure claim as a breach of
contract claim for Defendants’ breach of the Agreement, for which Plaintiff requests an Order of
Sale to exercise its right to foreclose on Defendants’ property.
The Court will separately consider the substantive merit of (1) claims brought by Plaintiff
for Defendants’ actions outside of the Agreement, for which Plaintiff requests damages, interest,
and attorneys’ fees and costs; and (2) Plaintiff’s foreclosure claim brought under the terms of the
Agreement and Deed of Trust, for which Plaintiff requests an Order of Sale and attorneys’ fees.
The Court first turns to Plaintiff’s claim against all Defendants for violations of PACA.
1. PACA Claims against All Defendants
Plaintiff brings the following three PACA claims against all Defendants: (1)
“Enforcement of Statutory Trust Provisions of PACA,” pursuant to 7 U.S.C. § 499e(c)(1)-(4);56
(2) “Violation of the PACA: Failure to Maintain PACA Trust Assets,” pursuant to 7 U.S.C. §
499b(4);57 and (3) “Breach of Duty to Pay Under the PACA,” pursuant to 7 U.S.C. § 499b(4).58
When analyzing claims for violations of PACA, courts apply a different standard to a corporate
also brings PACA claims against Defendants Christopher and Diana Torres, in their individual capacities, for breach
of fiduciary duty and conversion and unlawful retention of PACA trust assets. Id. at 10–12, ¶¶ 47–62.
54 Dkt. No. 1 at 13–15.
55 See id. at 12–13, ¶¶ 63–70; Id. at 14–15.
56 Id. at 5–7, ¶¶ 25–33.
57 Id. at 7–8, ¶¶ 34–38.
58 Id. at 8–10, ¶¶ 39–46.
defendant than an individual defendant acting on behalf of a corporate defendant because the
liability of the individual defendant hinges on the liability of the corporate defendant. Thus, the
Court will first consider whether Plaintiff’s PACA claims against Defendant BFP have
substantive merit. The Court will then turn to Plaintiff’s claim against Defendants Christopher
and Diana Torres for violations of PACA.
a. Defendant BFP
Plaintiff alleges that between October 2, 2017 and January 8, 2018, Plaintiff “sold and
shipped to [Defendant BFP] at [Defendant BFP’s] request, perishable agricultural commodities
for agreed upon selling prices.”59 Plaintiff further alleges that “Defendants accepted said
shipments”60 and failed to remit any payments, even after Plaintiff sent all invoices to Defendant
BFP and “repeatedly demanded that [Defendant BFP] pay the sums that are due and owing under
these invoices.”61 Based on these events, Plaintiff alleges Defendant BFP violated PACA. The
Court first turns to Plaintiff’s claim against Defendant BFP for enforcement of PACA’s statutory
trust provisions.
i. Enforcement of Statutory Trust Provisions of PACA
pursuant to 7 U.S.C. § 499e(c)(1)-(4)
Plaintiff brings a claim against Defendant BFP to enforce the trust provisions of PACA
contained in Section 499e(c)(1-4) of the statute. PACA was enacted to promote fair dealing in
the sale of fruits and vegetables.62 PACA requires buyers to hold either the produce or all
proceeds or accounts receivable from a subsequent sale of the produce in trust for the benefit of
unpaid suppliers until “full payment of the sums owing in connection with such transactions has
59 Id. at 3, ¶ 10.
60 Id.
61 Id. at 4, ¶¶ 13–14.
62 Reaves Brokerage Co. v. Sunbelt Fruit & Vegetable Co., 336 F.3d 410, 413 (5th Cir. 2003).
been received by” the supplier.63 “The trust automatically arises in favor of a produce seller upon
delivery of produce.”64
Trust beneficiaries may sue in federal district court to enforce PACA’s constructive trust
provisions.65 PACA imposes a “strict set of requirements on produce sellers seeking to benefit
from the law’s protections.”66 In order to recover from a PACA trust, an alleged trust beneficiary
must demonstrate by a preponderance of the evidence that:
i. the goods sold were perishable agricultural commodities;
ii. the purchaser of the perishable agricultural commodities was a
commission merchant, a dealer, or broker;
iii. the transaction occurred in interstate or foreign commerce;
iv. full payment on the transaction has not been received by the
supplier, seller or agent;
v. the seller or supplier preserved its trust rights by giving written
notice to the purchaser; and
vi. the time allotted for acceptance of payment did not exceed the
maximum amount67 prescribed by PACA.68
“An unpaid seller loses the benefits of the trust unless it files written notice of its intent to
preserve its rights with the [USDA] and the produce dealer,”69 or provides such notice on its
“ordinary and usual billing or invoice statements.”70 To adequately provide notice through
invoice statements, PACA requires that the invoice or invoices contain the following language:
The perishable agricultural commodities listed on this invoice are sold subject to
the statutory trust authorized by section 5(c) of the Perishable Agricultural
Commodities Act, 1930 (7 U.S.C. 499e(c)). The seller of these commodities
63 7 U.S.C. § 499e(c)(2).
64 Eddy Produce LLC v. Sutton Fruit & Vegetable Co., No. 3:12-CV-00316-N, 2012 WL 487050, at *2 (N.D. Tex.
Feb. 14, 2012) (quoting Frio Ice, S.A. v. Sunfruit, Inc., 918 F.2d 154, 156 (11th Cir. 1990)).
65 7 U.S.C. § 499e(c)(5).
66 Bocchi Americas Assocs. Inc. v. Commerce Fresh Mktg. Inc., 515 F.3d 383, 389 (5th Cir. 2008).
67 See La Grasso Bros. Inc. v. Am. Foodservice, L.L.C.,, No. CIV. 10-10711, 2011 WL 891221, at *5 (E.D. Mich.
Mar. 11, 2011) (citing 7 U.S.C. § 499e(c)(3); Overton Distributors, Inc. v. Heritage Bank, 340 F.3d 361, 365 (6th
Cir.2003)) (“The maximum time for payment for a shipment to which a seller, supplier, or agent can agree and still
qualify for coverage under the trust is 30 days after receipt and acceptance. . . [t]his limitation exists because the
statute is intended to protect only those produce sellers making short-term credit arrangements.”).
68 In re Spiech Farms, LLC, 592 B.R. 152, 162 (Bankr. W.D. Mich. 2018) (citing A & J Produce Corp. v. Chang,
385 F.Supp.2d 354, 358 (S.D.N.Y. 2005) (citations omitted).
69 Eddy Produce LLC, No. 3:12-CV-00316-N, 2012 WL 487050, at *2 (quoting Frio Ice, S.A., 918 F.2d at 156).
70 7 U.S.C. § 499e(c)(4).
retains a trust claim over these commodities, all inventories of food or other
products derived from these commodities, and any receivables or proceeds from
the sale of these commodities until full payment is received.71
Here, Defendant BFP signed the parties’ Agreement. Therein, Defendant BFP stipulates
to the following facts, which demonstrate Plaintiff’s entitlement to recover from the PACA trust:
(1) Defendant BFP “engaged in the buying and selling of perishable agricultural commodities in
interstate and/or foreign commerce in wholesale and jobbing quantities as defined by [PACA];72
(2) Plaintiff shipped to Defendant BFP, at Defendant BFP’s request, “perishable agricultural
commodities for agreed upon selling prices cumulatively totaling a principal balance of at least
$610,960.00;”73 (3) Defendant BFP received and accepted the commodities without objection;74
(4) Defendant BFP has not paid anything towards the amount owed;75 and (5) Plaintiff “has
taken all steps necessary to properly preserve [its] PACA Trust rights. . .”76 The time allotted by
Plaintiff for acceptance of payment following shipment did not exceed the thirty-day maximum77
prescribed by PACA.78 Moreover, Plaintiff provided adequate notice pursuant to PACA when it
sent invoices to Defendants for all amounts due and owing that included the requisite language.79
71 Id. § 499e(c)(5).
72 Dkt. No. 15-12 at 2, ¶ iv.
73 Id. ¶ v.
74 Id. ¶ vii.
75 Id. ¶ v.
76 Id. ¶ viii.
77 See Dkt. No. 15-8 (all invoices provided by Plaintiff require payment within thirty days of shipment); see also La
Grasso Bros. Inc., No. CIV. 10-10711, 2011 WL 891221, at *5 (citing 7 U.S.C. § 499e(c)(3); Overton Distributors,
Inc., 340 F.3d at 365) (“The maximum time for payment for a shipment to which a seller, supplier, or agent can
agree and still qualify for coverage under the trust is 30 days after receipt and acceptance. . . [t]his limitation exists
because the statute is intended to protect only those produce sellers making short-term credit arrangements.”).
78 In re Spiech Farms, LLC, 592 B.R. 152, 162 (Bankr. W.D. Mich. 2018) (citing A & J Produce Corp. v. Chang,
385 F.Supp.2d 354, 358 (S.D.N.Y. 2005) (citations omitted).
79 Dkt. No. 15-8. The invoices provided by Plaintiff contain the following language “The Perishable Agricultural
[Commodities] listed on this invoice are sold subject to the statutory [trust] authorized by [S]ection 5 (c) of the
Perishable Agricultural [Commodities] Act, 1930 (7 U.S.C. 499e(c)). [T]he seller of these commodities retains a
trust claim over these commodities, all inventories of food or other products derived from [these] [commodities],
and any receivables or proceeds from the sale of these commodities until full payment is received.” See id. This
passage was revised by the Court to correct multiple spelling errors.
Accordingly, the record indicates that Plaintiff has demonstrated its right to recover under
the PACA trust. The Court finds that Plaintiff’s PACA claim against Defendant BFP for
enforcement of statutory trust provisions of PACA is substantively meritorious. The Court now
turns to Plaintiff’s claim against Defendant BFP for its failure to maintain PACA trust assets.
ii. Failure to Maintain PACA Trust Assets pursuant to
7 U.S.C. § 499b(4)
Pursuant to Section 499b(4) of PACA, it is unlawful for a dealer “to fail to maintain the
trust as required under [S]ection 499e(c)” of the statute.80 When a trust arises in favor of a PACA
beneficiary, the dealer is “‘required to maintain trust assets in a manner that such assets are
freely available to satisfy outstanding obligations to sellers of perishable agricultural
commodities,’ and any act or omission inconsistent with this responsibility, including dissipation
of trust assets, is proscribed.”81 Thus, a dealer’s failure to use PACA trust assets to pay the
sellers of PACA goods ahead of all other creditors is a violation of the statute.82
Here, Plaintiff does not allege that Defendant BFP paid PACA trust assets to a specific
person or entity. However, the Court may assume the truth of all well-pled allegations in
Plaintiff’s complaint.83 Plaintiff alleges that “Defendants failed to maintain the trust assets and
keep them available to satisfy [Defendant BFP’s] obligations to Plaintiff.”84 Plaintiff further
alleges that “Defendants transferred or diverted the trust assets, and are continuing to so transfer
or divert trust assets, namely receivables or proceeds derived from Defendants’ sale of produce,
to their own use and/or to an unknown third party or parties, in violation of their statutory duties
80 7 U.S.C. § 499b(4).
81 In re Delta Produce, LP, 521 B.R. 576, 587 (W.D. Tex. 2014), aff'd in part sub nom. In re Delta Produce, L.P.,
817 F.3d 141 (5th Cir. 2016), opinion withdrawn and superseded on reh'g in part sub nom. Matter of Delta Produce,
L.P., 845 F.3d 609 (5th Cir. 2016), and aff'd in part sub nom. Matter of Delta Produce, L.P., 845 F.3d 609 (5th Cir.
2016) (citing 7 C.F.R. § 46.46(d)(1)).
82 See id.
83 Nishimatsu Const. Co., Ltd., 515 F.2d at 1206.
84 Dkt. No. 1 at 6, ¶ 31.
under the PACA to preserve the trust assets for the benefit of Plaintiff.”85 Assuming the truth of
Plaintiff’s well-pled allegations, the Court finds that Plaintiff’s claim that Defendant BFP failed
to maintain PACA trust assets in violation of 7 U.S.C. § 499b(4) is substantively meritorious.
The Court now turns to Plaintiff’s claim against Defendant BFP for breach of the duty to pay
under PACA.
iii. Breach of Duty to Pay Under PACA pursuant to
7 U.S.C. § 499b(4)
Plaintiff brings a claim for “Breach of Duty to Pay Under the PACA,” pursuant to 7
U.S.C. § 499b(4). Courts often refer to this claim as a claim for “failure to make full payment
promptly,” based on the language of Section 499b(4) making it a violation of federal law for a
dealer of perishable commodities to “fail . . . [to] make full payment promptly” to sellers of
produce.86 “Full payment promptly” means payment within ten days after the buyer accepts the
produce.87 Trust beneficiaries may also sue in federal district court to enforce PACA’s
requirement for prompt payment.88
Plaintiff alleges Defendant BFP did not make full payment promptly to Plaintiff within
ten days, as Defendant BFP has not made a single payment to Plaintiff for the amounts owed on
the invoices. Accordingly, the Court finds that Plaintiff’s claim that Defendant BFP did not make
full payment promptly to Plaintiff in violation of PACA is substantively meritorious. The Court
now turns to Plaintiff’s PACA claims against Defendants Christopher and Diana Torres for
enforcement of the statutory trust, failure to maintain PACA trust assets, and failure to make full
payment promptly.
85 Id. at 7, ¶ 32 (citing 7 C.F.R. § 46.46(c)).
86 7 U.S.C. § 499b(4).
87 Bocchi Americas Assocs. Inc, 515 F.3d at 388 (citing See 7 C.F.R. § 46.2(a)(5)(11)).
88 7 U.S.C. § 499b(4).
b. Defendants Christopher and Diana Torres
The Court now considers whether Plaintiff’s claims against Defendants Christopher and
Diana Torres, in both their individual capacities and capacities as co-trustees of C&D Holdings,
for enforcement of the statutory trust, failure to maintain PACA trust assets, and failure to make
full payment promptly are substantively meritorious.
The Fifth Circuit held in Goldman-Hayden Co. that where a corporation commits a
breach of a PACA trust or otherwise commits a PACA violation, certain officers or directors of
that corporation may be held personally liable for the violations of the corporation.89 The Fifth
Circuit explained: “PACA liability attaches first to the licensed . . . [dealer] . . . of perishable
agricultural commodities,” but if “the assets of the licensed . . . [dealer] . . . 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.”90 A person plays such a role in
causing the corporate dealer’s breach of trust if they are an “individual [shareholder], [officer], or
[director] of a corporation who [is] in a position to control trust assets, and who breach[es] their
fiduciary duty to preserve those assets.”91 An individual breaches their fiduciary duty and is
personally liable for the PACA violation of the licensed dealer where they are in the position to
control the trust assets and do not preserve them for the beneficiaries of the trust.92
Because PACA liability first attaches to the licensed dealer, the liability of Defendants
Christopher and Diana Torres is linked to Defendant BFP’s liability to Plaintiff under PACA.
The Court has found in this Order that Plaintiff’s PACA claims against Defendant BFP for
enforcement of the statutory trust, failure to maintain PACA trust assets, and failure to make full
89 See Golman-Hayden Co. v. Fresh Source Produce Inc., 217 F.3d 348, 351 (5th Cir. 2000).
90 Id.
91 Id.
92 See In re Delta Produce, LP, 521 B.R. at 593.
payment promptly are substantively meritorious. Therefore, the Court need only consider
whether Defendants Christopher and Diana Torres, individually and in their capacities as co-
trustees of C&D Holdings, can be held personally liable for Defendant BFP’s PACA violations.
As an initial matter, Plaintiff does not clarify whether its allegations regarding the role of
Defendants Christopher and Diana Torres in Defendant BFP’s operations are made against
Defendants Christopher and Diana Torres in their individual capacities or their capacities as co-
trustees of C&D Holdings. The Court can only assume that allegations made against “Defendants
Christopher and Diana Torres” in an unspecified capacity are allegations made against them in
their individual capacities. The Court will first consider the liability of Defendants Christopher
and Diana Torres in their individual capacities.
Plaintiff alleges that Defendants “Christopher Torres and Diana Torres are corporate
officers of [Defendant BFP] and are listed as such on [Defendant BFP’s] PACA license.”93
Plaintiff further alleges that Defendants “Christopher Torres and Diana Torres controlled or had
a duty to control [Defendant BFP’s] operations and financial dealings, including those involving
the PACA trust assets.”94 Moreover, Defendants Christopher and Diana Torres admit to these
allegations in the parties’ Agreement. Therein, Defendants Christopher and Diana Torres, in their
individual capacities, stipulate that “[Defendants Christopher and Diana Torres] during all times
mentioned herein were, officers, directors, shareholders, managers, and/or members of
[Defendant BFP] and therefore are and during all times mentioned herein were, statutory PACA
trustees subject to the trust provisions of PACA. . .”95 Assuming the truth of Plaintiff’s well-pled
allegations and considering the stipulated facts contained in the parties’ Agreement, the Court
93 Dkt. No. 15 at 8, ¶ 36 (citing to Dkt. No. 15-7, Defendants’ PACA license).
94 Id.
95 Dkt. No. 15-12 at 2, ¶ xii.
finds that Defendants Christopher and Diana Torres, in their individual capacities, were in the
position to control trust assets held by Defendant BFP and breached their fiduciary duty to do so.
Accordingly, Defendants Christopher and Diana Torres, in their individual capacities, can
be held personally liable for the PACA violations of Defendant BFP outlined in this Order. Thus,
Plaintiff’s claims against Defendants Christopher and Diana Torres, in their individual
capacities, for enforcement of the statutory trust, failure to maintain PACA trust assets, and
failure to make full payment promptly, are substantively meritorious. The Court now turns to the
liability of Christopher and Diana Torres in their capacities as co-trustees of C&D Holdings.
Plaintiff makes no specific allegations that Defendants Christopher and Diana Torres, in
their capacities as co-trustees of C&D Holdings, are officers or directors of Defendant BFP
whose PACA liability can be derived from that of Defendant BFP. Only the Agreement provides
any detail regarding the relationship between Defendant BFP and C&D Holdings. The
Agreement provides that C&D Holdings “is the owner of real property located at 2501 West
Military Highway, Suite A18, McAllen, Texas 78503.”96 This property appears to have been
utilized by Defendant BFP as a warehouse.97 There is nothing in the record to suggest that
Defendants Christopher and Diana Torres exercised control over PACA assets in their capacities
as co-trustees of a company that owned a piece of property utilized by Defendant BFP. Thus, the
Court finds that Plaintiff’s attempt to allege PACA liability against Defendants Christopher and
Diana Torres, in their capacities as co-trustees of C&D Holdings, does not have substantive
merit. The Court hereby DENIES Plaintiff’s PACA claims against Defendants Christopher and
Diana Torres, in their capacities as co-trustees of C&D Holdings.
96 Id. ¶ xiii.
97 See id.
Accordingly, the Court finds Plaintiff’s claim against Defendant BFP and Defendants
Christopher and Diana Torres, in their individual capacities, for enforcement of the statutory
trust, failure to maintain PACA trust assets, and failure to make full payment promptly, are
substantively meritorious. The Court also finds that these same claims against Defendants
Christopher and Diana Torres, in their capacities as co-trustees of C&D Holdings, are not
substantively meritorious. In light of this, and the fact that Plaintiff requests identical damages
for all of its claims except foreclosure,98 the Court need not consider the substantive merit of
Plaintiff’s claims against Defendants Christopher and Diana Torres, in their individual
capacities, for breach of fiduciary duty and unlawful conversion of PACA assets, or Plaintiff’s
breach of contract claim against Defendant BFP. The Court now turns to Plaintiff’s foreclosure
claim.
2. Foreclosure
Plaintiff titles its final claim “foreclosure,” and argues that pursuant to the terms of the
Agreement and a Deed of Trust executed by Defendants, Plaintiff is “entitled to foreclose upon”
two properties owned by Defendants. Plaintiff alleges that “Defendants have failed to pay all of
the amounts due and outstanding under the [Agreement], the first payment which was due on
January 15, 2019.99 Plaintiff requests relief in the form of an Order of Sale and attorneys’ fees
and costs. As the Court discusses elsewhere in this Order, the Court interprets Plaintiff’s
“foreclosure” claim as a breach of contract claim for Defendants’ default of the Agreement,
which is secured by the Deed of Trust.
The elements of a breach of contract claim in Texas include: “(1) the existence of a valid
contract; (2) performance by plaintiff; (3) breach of the contract by the defendant; and (4)
98 For its PACA and breach of contract claims, Plaintiff requests the following relief: damages in the amount of
$610,960.00; pre-judgment and post-judgment interest; and attorneys’ fees and costs. Dkt. No. 1 at 13–15.
99 Id. at 12, ¶ 68.
damages sustained by plaintiff as a result of the breach.”100 Plaintiff bears the burden of
demonstrating it suffered a loss resulting from the breach.101
Considering the well-pled allegations contained in Plaintiff’s complaint, the Court finds
that Plaintiff’s breach of contract claim does not have substantive merit. The Agreement
constitutes a valid contract – it is signed by all parties and memorializes Plaintiff’s promise to
dismiss the formal USDA complaint against Defendants within ten days of the Agreement in
exchange for Defendants’ promise to pay their debt to Plaintiff in gradual installments. However,
Plaintiff does not plead and there is no indication on the record that Plaintiff performed its
obligation under the Agreement. The Agreement requires Plaintiff to dismiss its formal USDA
complaint. Plaintiff only maintains that it has performed all “conditions, covenants, and
obligations required to be performed by [Plaintiff] under the agreements for the sale of the
perishable agricultural commodities.” 102 Yet, Plaintiff does not maintain that it dismissed its
formal complaint with USDA in performance under the parties’ Settlement Agreement. Plaintiff
seeks to foreclose on Defendants’ properties pursuant to the terms of the Agreement, which is
secured by the Deed of Trust, but Plaintiff does not offer evidence that it has performed under
the terms of the Agreement to make its claim for Defendants’ breach of the Agreement
substantively meritorious.
Moreover, while it is unclear from the complaint, Plaintiff appears to request that this
Court issue an Order of Sale for both properties discussed in the Agreement, and alleges that the
Agreement “is secured by a Deed of Trust on certain real property located at 2501 West Military
Highway, Suite A18, McAllen, Texas 78503 and fraccion “B” del lote de terreno ubicado en la
100 Sport Supply Group, Inc. v. Columbia Cas. Co., 335 F.3d 453, 465 (5th Cir. 2003).
101 Taub v. Hous. Pipeline Co., 75 S.W.3d 606, 616 (Tex. App. 2002).
102 See Dkt. No. 1 at 4, ¶ 16.
ex Hacienda de Encarnacion de Guzman, municipality of Saltillo, Mexico.”103 However, the
Deed of Trust attached by Plaintiff applies to only the McAllen property and does not mention a
property in Mexico. Plaintiff fails to support its request for foreclosure with appropriate
documents identifying the property to be foreclosed.
For the aforementioned reasons, the Court finds that Plaintiff’s “foreclosure” claim, as it
is currently pled, does not have substantive merit. Accordingly, the Court hereby DENIES
WITHOUT PREJUDICE Plaintiff’s motion for default judgment as to the “foreclosure” claim.
To the extent Plaintiff wishes to further pursue this claim against Defendants, the Court
ORDERS Plaintiff to file a motion with the Court by Friday, May 22, 2020. Therein, Plaintiff
should (1) specify what cause of action it brings; and (2) attach a Deed of Trust applicable to the
Mexico property or provide an explanation for the absence of this document in the record. The
Court now turns to Plaintiff’s requested relief.
iii. Requested Relief
Finally, the Court is able to determine whether the requested relief is appropriate104
pursuant to Rule 54(c). Rule 54(c) dictates that a default judgment “must not differ in kind from,
or exceed in amount, what is demanded in the pleadings.”105
1. Damages
Plaintiff requests damages in the amount of $610,960.00. The Court finds Plaintiff’s
request for $610,960.00 warranted, as this amount corresponds with the amounts owed on the
103 Id. at 12, ¶ 64.
104 United States v. 1998 Freightliner Vin #: 1FUYCZYB3WP886986, 548 F. Supp. 2d 381, 384 (W.D. Tex. 2008).
105 FED. R. CIV. P. 54(c).
invoices.106 Moreover, Defendants stipulate to the fact that this is the total amount owed on the
invoices.107 Thus, the Court AWARDS Plaintiff $610,960.00.
2. Pre-Judgment Interest
The Court finds that Plaintiff’s request for $34,751.50 in pre-judgment is not appropriate.
Plaintiff requests five percent of $610,960.00 annually from the date of September 2, 2018, 180
days after Defendants received notice of the claim from the USDA, to the date of judgment.108
Plaintiff cites to a decision by the Northern District of Texas in Paisano Capital SA de CV v. 23
Tex. Produce, Inc., wherein the court made the determination to calculate 5.5% pre-judgment
interest in accordance with Section 304.101 of the Texas Finance Code on the grounds that there
was no enabling statute governing the award.109 However, Plaintiff’s reliance on this case
ignores this Court’s decision in Paisano Capital SA de CV v. Velazquez, wherein the Court
expressly declined to adopt the Northern District’s calculation of pre-judgment interest in light of
the Texas Supreme Court’s decision in Johnson & Higgins of Texas, Inc. v. Kenneco Energy,
Inc.110 In Paisano Capital SA de CV v. Velazquez, the Court noted that “[i]n Johnson, the
Supreme Court of Texas held that where a state enabling statute does not apply to a particular
claim, ‘prejudgment interest accrues at the rate for postjudgment interest.’”111 The Johnson court
utilized the post-judgment interest rate, a decision that was later upheld by the Fifth Circuit in
106 See Dkt. No. 15-8; see also Dkt. No. 15-9 (Accounting of Attorneys’ Fees).
107 Dkt. No. 15-12 at 2, ¶ v.
108 Dkt. No. 12 at 8–10, ¶¶ 38–42.
109 Paisano Capital SA de CV v. 23 Texas Produce, Inc., No. 3:19-CV-0852-B, 2019 WL 3239152, at *5 (N.D. Tex.
July 18, 2019).
110 Paisano Capital SA de CV v. Velazquez, No. 7:19-CV-078, 2019 WL 6649294, at *14 n. 146 (S.D. Tex. Dec. 6,
2019) (citing Johnson & Higgins of Texas, Inc. v. Kenneco Energy, Inc., 962 S.W.2d 507, 532 (Tex. 1998)).
111 Id.
Int'l Turbine Servs., Inc. v. VASP Brazilian Airlines and adopted by this Court in Paisano
Capital SA de CV v. Velazquez.112
Because, as Plaintiff admits,113 there is no applicable enabling statute, the Court once
again finds it appropriate to set the pre-judgment interest rate at the post-judgment interest rate.
Pre-judgment interest begins to accrue on the earlier of (1) 180 days after the date a defendant
receives written notice of a claim or (2) the date suit is filed.114
Currently, the post-judgment interest rate is 0.17%.115 Here, interest began to accrue on
September 2, 2018, 180 days after Defendants received written notice of Plaintiff’s PACA
claims from the USDA.116 Accordingly, Plaintiff is entitled to pre-judgment interest in the
amount of $1,739.00.117
3. Post-Judgment Interest
Plaintiff requests post-judgment interest at the rate set forth by 28 U.S.C. § 1961.118 The
Court finds this request appropriate. Currently, the post-judgment interest rate is 0.17%.119
Accordingly, the Court finds Plaintiff is entitled to post-judgment interest, which shall accrue at
the rate of 0.17% from the date of this Order.
112 See Int'l Turbine Servs., Inc. v. VASP Brazilian Airlines. 278 F.3d 494, 499 (5th Cir. 2002); see also Paisano
Capital SA de CV v. Velazquez, No. 7:19-CV-078 at *14 n. 146.
113 Dkt. No. 12 at 10, ¶ 41 (“Here, pre-judgment interest is left to the Court’s determination as there is no statute that
governs the award.”).
114 Johnson, 962 S.W.2d at 529.
115 See 28 U.S.C. § 1961(a) (2000) (Post-judgment interest “shall be calculated from the date of the entry of the
judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board
of Governors of the Federal Reserve System, for the calendar week preceding the date of the judgment.”);
http://www.txs.uscourts.gov/page/post-judgment-interest-rates (last visited 5/6/2020).
116 Defendants received notice of Plaintiff’s PACA claims from the USDA on March 6, 2018. See Dkt. No. 15-11.
117 0.17 percent of $610,960.00 is $1,038.63. Because pre-judgment interest accrues annually, Plaintiff is entitled to
$1,038.63 for the interest accrued from September 2, 2018 to September 2, 2019. Pre-judgment interest accrues at
approximately $2.84 per day. Therefore, Plaintiff is entitled to $700.00 for the pre-judgment interest accrued from
September 3, 2019 to May 6, 2020. In sum, Plaintiff is entitled to $1,738.63 in pre-judgment interest, which the
Court rounds to $1,739.00.
118 Dkt. No. 15 at 11–12, ¶ 46.
119 See 28 U.S.C. § 1961(a) (2000) (Post-judgment interest “shall be calculated from the date of the entry of the
judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board
of Governors of the Federal Reserve System, for the calendar week preceding the date of the judgment.”);
http://www.txs.uscourts.gov/page/post-judgment-interest-rates (last visited 5/6/2020).
4. Attorneys’ Fees and Costs
Plaintiff requests attorneys’ fees in the amount of $15,145.50.120 In support of its request,
Plaintiff attaches an affidavit by Plaintiff’s attorney, Allison N. Boyle121 and a summary of the
hours billed by Ms. Boyle’s firm, Atlas, Hall & Rodriguez, LLP.122 In her affidavit, Ms. Boyle
indicates that Plaintiff incurred attorneys’ fees totaling $6,141.50 as a result of the work
completed by Atlas, Hall & Rodriguez, LLP. However, Ms. Boyle also indicates that Plaintiff
was represented in this matter by the firm Rynn and Janowsky. Ms. Boyle claims Plaintiff
incurred attorneys’ fees totaling $9,004.00 as a result of the work completed by Rynn and
Janowsky. Thus, Plaintiff’s motion for default judgment requests attorneys’ fees of $15,145.50
for the work completed by Atlas, Hall & Rodriguez, LLP and Rynn and Janowsky.
The Court declines to award this amount for two reasons. First, while Ms. Boyle includes
necessary details regarding her hourly rate and the hourly rate of another employee at her firm
who worked on this matter, no such information is provided for the work completed by Rynn and
Janowsky. Second, there is nothing in the record indicating how many hours of work were
performed by Rynn and Janowsky for the $9,004.00 in attorneys’ fees allegedly billed. There is
no affidavit from an attorney employed by Rynn and Janowsky and there are no documents from
the firm evidencing the hours billed. As such, the Court does not have adequate information by
which it can determine whether the attorneys’ fees requested for the work performed by Rynn
and Janowsky are reasonable. Thus, the Court will only consider whether the attorneys’ fees
requested for the work completed by Atlas, Hall & Rodriguez, LLP are reasonable.
120 Dkt. No. 15 at 11, ¶ 45.
121 Dkt. No. 15-15.
122 Dkt. No. 15-16.
Ms. Boyle indicates that Atlas, Hall & Rodriguez, LLP billed 34.40 hours on this
matter.123 Ms. Boyle also provides that the hours were billed by Ms. Boyle at $185.00 per hour
and a paralegal, Merriwood Ferguson, at $120.00 per hour.124 However, the accounting
documents attached by Plaintiff indicate that another attorney – E. Michael Rodriguez – billed
0.50 hours at $325.00 per hour.125 Ms. Boyle states that she has been licensed to practice law
since 2013.126 Mr. Rodriguez’s experience level is not provided. The Court first considers the
hours billed by Ms. Boyle.
Ms. Boyle billed 29.30 hours on this matter at a rate of $185.00 per hour.127 Based on the
last average billing rates provided by the State Bar of Texas in 2015, $250.00 is a reasonable
hourly rate for an attorney with three to six years of experience.128 Accordingly, the Court finds
that Ms. Boyle’s hourly rate of $185.00 is reasonable. The Court hereby awards Plaintiff
$5,421.00 for the 29.30 hours billed by Ms. Boyle. The Court now turns to the hours billed by
Mr. Rodriguez.
Mr. Rodriguez billed 0.50 hours on this matter at a rate of $325.00 per hour. Since
Plaintiff does not provide the Court with Mr. Rodriguez’s experience level, the Court takes
judicial notice of Mr. Rodriguez’s many years of practice before this Court. Based on the last
average billing rates provided by the State Bar of Texas in 2015, $300.00 is a reasonable hourly
rate for an attorney with sixteen to twenty years of experience.129 Thus, the Court finds Mr.
123 Dkt. No. 15-15 at 3, ¶ 12.
124 Id. ¶¶ 10–11.
125 Dkt. No. 15-16 at 1.
126 Dkt. No. 15-15 at 1, ¶ 2.
127 See Dkt. No. 15-16.
128 See State Bar of Texas 2015 Hourly Rate Fact Sheet, 12 (2016)
https://www.texasbar.com/AM/Template.cfm?Section=Demographic_and_Economic_Trends&Template=/CM/Cont
entDisplay.cfm&ContentID=34182 (providing $250.00 as the median hourly fee for a lawyer with three to six years
of experience in 2015 and basing years of experience on year first licensed in any jurisdiction). The Texas Bar’s
2015 report is its most recent.
129 See State Bar of Texas 2015 Hourly Rate Fact Sheet, 12 (2016)
Rodriguez’s hourly rate of $325.00 is reasonable. Accordingly, the Court awards Plaintiff
$163.00 for the 0.50 hours billed by Mr. Rodriguez. The Court now turns to the hours billed by
Merriwood Ferguson.
Merriwood Ferguson billed 4.50 hours on the case at $120.00 per hour.130 Because
Merriwood Ferguson is a paralegal and the Court is unaware of his or her experience level, the
Court provides attorneys’ fees at the low end of the applicable range. Based on the last average
billing rates provided by the State Bar of Texas in 2015, $200.00 is a reasonable hourly rate for
an attorney with two years or less of experience.131 Accordingly, the Court finds that Merriwood
Ferguson’s hourly rate of $120.00 is reasonable. The Court awards Plaintiff $540.00 for the 4.50
hours billed by Merriwood Ferguson.
In sum, the Court hereby AWARDS Plaintiff $6,124.00 in attorneys’ fees. The Court
now turns to Plaintiff’s request to recover its costs.
Plaintiff also seeks to recover costs in the amount of $667.91, which resulted from filing
fees, fees for service of process, fees for legal research, and postage.132 The Court finds this
request reasonable. The Court hereby AWARDS Plaintiff $668.00 in costs.
III. HOLDING
For the reasons stated herein, the Court hereby GRANTS IN PART and DENIES IN
PART Plaintiff’s motion for default judgment.133 Specifically, the Court GRANTS Plaintiff’s
https://www.texasbar.com/AM/Template.cfm?Section=Demographic_and_Economic_Trends&Template=/CM/Cont
entDisplay.cfm&ContentID=34182 (providing $300.00 as the median hourly fee for a lawyer with sixteen to twenty
years of experience in 2015 and basing years of experience on year first licensed in any jurisdiction). The Texas
Bar’s 2015 report is its most recent.
130 See Dkt. No. 15-16.
131 See State Bar of Texas 2015 Hourly Rate Fact Sheet, 12 (2016)
https://www.texasbar.com/AM/Template.cfm?Section=Demographic_and_Economic_Trends&Template=/CM/Cont
entDisplay.cfm&ContentID=34182 (providing $200.00 as the median hourly fee for a lawyer with two years or less
of experience in 2015 and basing years of experience on year first licensed in any jurisdiction). The Texas Bar’s
2015 report is its most recent.
132 Dkt. No. 15-15 at 3, ¶ 13.
motion for default judgment as to its PACA claims against Defendant BFP and Defendants
Christopher and Diana Torres, in their individual capacities, for enforcement of the statutory
trust, failure to maintain PACA trust assets, and failure to make full payment promptly. The
Court DENIES AS MOOT all remaining claims against Defendants Christopher and Diana
Torres, in their individual capacities.'** The Court DENIES default judgment as to all claims
against Defendant Christopher and Diana Torres in their capacities as co-trustees of C&D
Holdings. The Court also DENIES default judgment as to Plaintiff's cause of action for
“foreclosure.”
The Court AWARDS Plaintiff $610,960.00 in damages, plus post-judgment interest at a
rate of 0.17% from the date of this Order.'*? The Court also awards Plaintiff $1,739.00 in pre-
judgment interest and a total of $6,792.00 for attorneys’ fees and costs.
The Court further ORDERS Plaintiff to advise the Court regarding whether it intends to
further pursue its claim for “foreclosure” against Defendants by Friday, May 22, 2020.
IT IS SO ORDERED.
DONE at McAllen, Texas, this 6th day of May, 2020.
War, 7
Micaela Alvarez
United States District Judge
Dkt. No. 15.
' These include Plaintiff’s claims against Defendant Christopher and Diana Torres, in their individual capacities,
for breach of fiduciary duty and conversion and unlawful retention of PACA trust assets.
See 28 U.S.C. § 1961(a) (2000) (Post-judgment interest “shall be calculated from the date of the entry of the
judgment, at a rate equal to the weekly average 1-year constant maturity Treasury yield, as published by the Board
of Governors of the Federal Reserve System, for the calendar week preceding the date of the judgment.”);
http://www.txs.uscourts. gov/page/post-judgment-interest-rates (last visited 5/6/2020).
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