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PHILLIPS MUSHROOM FARMS, L.P. v. GOLD STAR MUSHROOM COMPANY

March 29, 2004.

PHILLIPS MUSHROOM FARMS, L.P., Plaintiff
v.
GOLD STAR MUSHROOM COMPANY, INC., and BERNARDO J. PENTURELLI, Defendants



The opinion of the court was delivered by: JAMES KNOLL GARDNER, District Judge

MEMORANDUM OPINION

This matter is before the court on Plaintiff's Motion for Reconsideration to Vacate Judgment and for Summary Judgment filed May 5, 2003.*fn1 Plaintiff seeks the reversal of our Order granting summary judgment in favor of defendants and against plaintiff, which Order was placed on the record after argument held April 22, 2003. We simultaneously placed the Page 2 reasons for our determination on the record. Because we conclude that summary judgment was properly granted in favor of defendants and against plaintiff, we deny plaintiff's motion for reconsideration.

  Procedural History

  In the within civil action, plaintiff asserts a claim under the Perishable Agricultural Commodities Act*fn2 ("PACA"). The matter is before the court on federal question jurisdiction. 7 U.S.C. § 499e(c)(5); 28 U.S.C. § 1331. Venue is appropriate because the facts and circumstances giving rise to plaintiff's cause of action occurred in Berks County, Pennsylvania, and because defendants may be found in Berks County. See 28 U.S.C. § 118, 1391.*fn3

  On April 22, 2003, the undersigned held oral argument on the cross-motions for summary judgment of the Page 3 parties. At the conclusion of argument, on the record, in open court, and in the presence of counsel for the parties, the undersigned entered an Order granting defendant's motion for summary judgment, denying plaintiff's motion for summary judgment, and dismissing plaintiff's Complaint. Also at that time, the undersigned placed the reasons for the decision on the record, which we incorporate here. Our April 22, 2003 Order was reduced to writing and filed on May 7, 2003.

  Facts

  Based upon the pleadings, record papers, affidavits, uncontested exhibits, and agreements of counsel at oral argument, the pertinent facts are as follows. On December 4 and 6, 1998 and May 15, 1999, plaintiff Phillips Mushroom Farms, L.P. (Phillips) sold persishable agricultural commodities to defendant Gold Star Mushroom Company, Inc. (Gold Star).*fn4

  On December 4, 1998, Phillips sold 18,382 pounds and 2860 containers of brown agricus-biporus mushrooms, known in the marketplace as portabella mushrooms ("portabellas"), to Page 4 Gold Star for $20,539.00.*fn5 Two days later, on December 6, 1998, Phillips sold 18,638 pounds and 2860 containers of portabellas to Gold Star for $20,857.20.*fn6 Plaintiff requested payment within 25 days in the invoices for both the December 4 and December 6 shipments. Page 5

  On January 8, 1999, James Angelucci, General Manager of Phillips, wrote to the Northeast Region of the PACA Branch of the Fruits and Vegetable Division of the Department of Agriculture. He wrote to file an informal complaint against Gold Star for delinquency concerning mushrooms sold to Gold Star from November 14, 1998 to December 6, 1998. The letter states that Gold Star had proposed a payment schedule of $3,000.00 per week for the $203,433.90 which Gold Star owed Phillips for mushroom sales. Mr. Angelucci claims that this offer was unacceptable.*fn7

  On January 14, 1999 Robert Smith, Controller for Gold Star, sent a letter to plaintiff in which he offered another alternative payment plan. Included in the letter was a check for $10,000.00 and a copy of a "Promissory Judgment Note".*fn8 The Promissory Judgment Note provided that Gold Star would pay Phillips for various outstanding debts, including the December 4 and December 6 sales, totaling $203,433.90. By the terms of the note Gold Star was to have until September 2, 1999 to pay its debt.*fn9

  On January 20, 1999, plaintiff responded to Mr. Page 6 Smith's letter. In the response, plaintiff agreed to the terms of the letter and the "Promissory Judgment Note". The acceptance letter was signed by R. Marshall Phillips, General Partner of Phillips.

  On January 20, 1999, Mr. Smith sent another letter to plaintiff. This letter enclosed a $6,000.00 check and a signed copy of the "Promissory Judgment Note". The letter also states that Mr. Smith understood from Tom Tranquillo, an agent of Gold Star, that plaintiff had agreed to the terms of the note.

  On May 15, 1999 Phillips Mushroom sold 20,562 pounds and 2880 containers of portabellas to Gold Star for $25,086.30.*fn10 The invoice for the May 15 sale requested payment within 25 days.

  On June 1, 1999, Mr. Angelucci wrote to Mr. Smith. The letter purports to memorialize a conversation held between Mr. Angelucci and Jim Penturelli, an agent of Gold Star.*fn11 According to the letter, the parties agreed to change the existing promissory note by altering the agreement term and the weekly payment amount contingent upon the following Page 7 addition:
Until this Promissory Judgment Note is paid in full, Obligor agrees not to sell, package, furnish, market, or otherwise make available to the fresh market, brown Agricus-biporus mushrooms known in the marketplace as Crimini or Portabella mushrooms. This in no way limits Obligor from processing the aforementioned mushrooms.
  The letter continues that if the ...

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