Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: Citrus Hill Manufacturing Company (Citrus Hill) is a wholly owned subsidiary of Proctor and Gamble. Citrus Hill is in the business of producing, manufacturing, packaging and distributing citrus products throughout the United States. It's main product has been "Select" orange juice which is 100 percent orange juice. Its principle manufacturing facility is located in Frostproof, Florida. While Citrus Hill has four other manufacturing sites outside the State of Florida, its Florida plant is the only facility for manufacturing frozen products. While it can produce chilled products at its plants located outside Florida, Citrus Hill's Florida plant is necessary to supply the demand for its chilled products on a national basis. In an effort to expand its market, Citrus Hill developed three products which it produces and packs at its plant in Frostproof, Florida. These products are and have been labeled as follows: "Lite Citrus Hill Orange Juice Beverage 60 percent Orange Juice," "Lite Citrus Hill Grapefruit Juice Beverage 45 percent Grapefruit Juice," and "Plus Calcium Citrus Hill, Calcium Fortified Grapefruit Juice Beverage - 60 percent Grapefruit Juice." The "lite" beverages are reduced calorie diluted juice beverages with the addition of Nutrasweet. The third product is a diluted grapefruit juice beverage fortified with calcium. By a letter dated March 19, 1987, the Department of Citrus ordered Citrus Hill to change its diluted citrus products labels and informed Citrus Hill that the Department would enforce Rule 20-66.001(4), Florida Administrative Code. That rule provides "Labels for diluted citrus products shall not include the word "juice" in the name of the product." By a Final Order entered this same date, that Rule was declared to be an invalid exercise of delegated legislative authority. As noted above, Citrus Hill markets and sells its product line throughout the United States. It desires to utilize the names of its diluted juice products as indicated in paragraph two above for three reasons. First, Citrus Hill believes that its labeling is in compliance with federal law. Second, it believes that a product name which includes the word "juice" more fully informs the consumer of the nature of the product because it is more exact, descriptive and less ambiguous than any name not using the word "juice," such as "drink," "ade," or "beverage." Third, Citrus Hill fears that if it were unable to disclose through its product name that the product is primarily a juice product, it would be placed at a competitive disadvantage in the national marketplace where non-Florida producers of similar products would not be bound by the challenged Rule's ban on the use of the word "juice" in the name of diluted juice products. While Citrus Hill could move its packaging facilities outside the state and utilize two product labels (one for Florida shipment and one for the non-Florida market), this alternative would be extremely expensive and would constitute a "distribution nightmare." Many distributors and large retail grocery stores work in multi-state regions and may not be willing to segregate and keep track of petitioner's different product labels for shipment in Florida and in non-Florida states. No other state in the United States prohibits the word "juice" in the labeling of diluted citrus juice products. In the late 1960's and early 1970's, the subject of proper labeling of diluted fruit juice beverages was under discussion by both the Florida Department of Citrus and the Federal Food and Drug Administration (FDA) under the Food, Drug and Cosmetic Act. The FDA ultimately rejected the proposal of prohibiting the word "juice" from the name of any product that was not 100 percent pure juice, and also rejected the approach of defining different products through "standards of identity." This latter method of labeling products would have defined a product as "fades" only if containing more than 10 percent, but less than 20 percent, juice, and various other category names based upon the percentage of fruit juice contained in the product. The prohibition against the word "juice" and the "standards of identity" proposals for the labeling of diluted juice products were rejected by the FDA in favor of a common or usual name approach, with a percent declaration of any characterizing ingredient. The pertinent federal regulations addressing the labeling of food products are contained in 21 C.F.R. Chapter 1. The more general regulation appears in 21 C.F.R. 102.5(a) and (b), and states, in pertinent part, as follows: "Section 102.5 General Principles. The common or usual name of a food ... shall accurately identify or describe, in as simple and direct terms as possible, the basic nature of the food or its characterizing properties or ingredients. The name shall be uniform among all identical or similar products and may not be confusingly similar to the name of any other food that is not reasonably encompassed within the same name. Each class or subclass of food shall be given its own common or usual name that states, in clear terms, what it is in a way that distinguishes it from different foods. The common or usual name of a food shall include the percentage(s) of any characterizing ingredient(s) or component(s) when the . component(s) ... has a material bearing on ... consumer acceptance or when the labeling ... may otherwise create an erroneous impression that such ... component(s) is present in an amount greater than is actually the case. The following requirements shall apply unless modified by a specific regulation in Subpart B of this part. The percentage of a characterizing ingredient or component shall be declared on the basis of its quantity in the finished product... The percentage of a characterizing ingredient or component shall be declared by the words "containing (or contains) percent (or %) ---" ... with the first blank filled in with the percentage expressed as a whole number not greater than the actual percentage of the ingredient or component named and the second blank filled in with the common or usual name of the ingredient or component." The FDA has also promulgated regulations dealing with the labeling of specific nonstandardized foods, including diluted orange juice beverages and diluted fruit or vegetable juice beverages other than diluted orange juice beverages. With respect to diluted orange juice beverages, 21 C.F.R. Section provides as follows: "102.32. Diluted Orange Juice Beverages. The common or usual name of a non- carbonated beverage containing less than 100 percent and more than 0 percent orange juice shall be as follows: A descriptive name for the product meeting the requirements of Section 102.5(a)(e.g., diluted orange juice beverage or another descriptive phrase), and A statement of the percent of each juice contained in the beverage in the manner set forth in Section 102.5(b)(2). The percent of the juice shall be declared in 5 percent increments, expressed as a multiple of five not greater than the actual percentage of orange juice in the product, except that the percent of orange juice in products containing more than 0 percent but less than 5-percent orange juice shall be declared in the statement as "less than 5" percent." Diluted fruit or vegetable juice beverages other than diluted orange juice beverages are the subject of 21 C.F.R. Section 102.33, 1/ which provides as follows: "102.33 Diluted fruit or vegetable juice beverages other than diluted orange juice beverages. The common or usual name of a non- carbonated beverage containing less than 100 percent and more than zero percent fruit or vegetable juice(s), other than only orange juice, shall be as follows: A descriptive name meeting the requirements of Section 102.5(a)(e.g., "diluted grape juice beverage", "grape juice drink", or another descriptive phrase) and A statement of the percent of each juice contained in the beverage in the manner set forth in Section 102.5(b)(2). The percent of the juice shall be declared in five percent increments, expressed as a multiple of five not greater than the actual percentage of juice in the beverage except that the percentage of any juice in beverages containing more than zero percent but less than 5 percent of that juice shall be declared in the statement as "less than 5 percent." The Department of Citrus has conducted two consumer surveys for the purpose of determining whether the word "juice" in a product name of a diluted citrus juice product is confusing or misleading. The Drossler study was conducted in 1972, and concluded that consumers are confused by the word "juice." However, that conclusion appears to be founded on the premise that the only proper use of the word "juice" is in the technical sense of "100 percent pure juice." In other words, what was measured in the survey was the consumer's failure to use the word "juice" in a limited sense to mean "100 percent pure juice." The surveyed consumer was asked to look at several products, and then state "what kind of product is this?" The products viewed consisted of several different dairy products and a citrus beverage. If the consumer used the word "juice" to describe the kind of product pointed to, he was treated as being confused if the product was less than 100 percent juice. No follow-up questions were asked concerning the consumer's understanding of the content of the product. The Chelsea study was conducted at the request of the Department of Citrus in 1987. It, too, concludes that there would be less consumer confusion if the word "juice" were eliminated from products comprised of less than 100 percent pure citrus juice. However, there was evidence that this study attempted to address too many issues, including consumer preferences, and that "question contamination" could well have occurred. This refers to the intentional or unintentional biasing of the interviewees by the ordering or phraseology of the questions asked. Both the Burke study and the Chelsea study indicate that consumers are not confused by a beverage label using the word juice in the product name when it is accompanied by the declaration of the percentage of juice contained in the product. The Burke study was conducted on behalf of the petitioner in 1987. After conducting interviews of 1200 people from all age groups in six different cities throughout the United States, it concluded that there was no significant difference in consumer confusion between the use of the word "juice" and "beverage" in the product name when the percentage of citrus juice content is indicated on the label. In other words, whether the label identified the product as a "juice beverage" or a "beverage," the respondents were able to determine the amount of actual juice contained in the product.
Recommendation Based upon the findings of fact and conclusions of law recited herein, it is RECOMMENDED that the Department of Citrus rescind its order or directive to the petitioner to discontinue the use of the word "juice" in its labels for diluted citrus juice beverages. Respectfully submitted and entered this 9th day of December, 1987, in Tallahassee, Florida. DIANE D. TREMOR Hearing Officer Division of Administrative Hearings The Oakland Building 2009 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 9th day of December, 1987.
The Issue The issues for determination in this case are whether Respondent, as a licensed citrus fruit dealer, misappropriated and marketed citrus fruit owned by Petitioner during the 1992-1993 shipping season, and further, whether such actions constitute a violation of the Florida Citrus Code for which proceeds of the citrus fruit dealer's bond executed by Co-Respondent should be paid to Petitioner in satisfaction of Petitioner's claim pursuant to Section 601.66, Florida Statutes.
Findings Of Fact Petitioner, Thompson Fruit Company, is a Florida company with an office in Winter Haven, Florida. Petitioner has been in the business of buying and selling citrus fruit for many years. James Thompson, Jr., (Thompson) is the President of Petitioner. Petitioner was actively engaged in the business of buying and selling citrus fruit during the 1992-1993 shipping season. Respondent, Golden Gem Growers, Inc., is a Florida corporation located in Umatilla, Florida, and was, at all material times, a licensed citrus fruit dealer under the provisions of chapter 601, Florida Statutes. Respondent is a cooperative organization comprised of citrus fruit grower members. Respondent offers various services to its members including harvesting and marketing services. Respondent enters into individual contracts with its grower members to accept and market citrus fruit. During the 1992-1993 shipping season Respondent entered into more than one hundred contracts with its grower members relating to the acceptance and marketing of citrus fruit. Co-Respondent, Fidelity & Deposit Company of Maryland, is a surety company qualified to do business in Florida, which, pursuant to section 601.61, Florida Statutes, during the 1992-1993 shipping season, executed a citrus fruit dealer's bond for Respondent in the amount of $100,000. E.J. Higgins (Higgins) at all material times hereto was a citrus fruit grower and member of Respondent's cooperative organization. On July 23, 1991, Higgins entered into a Revised Grower Member Agreement with Respondent. In accordance with its contract with Higgins, Respondent was obligated to provide citrus fruit harvesting and marketing services to Higgins. On July 5,1990, Higgins had entered into a Crop Agreement and a separate Lease Agreement relating to a citrus grove owned by Pomco Associates, Inc., (Pomco) in Manatee, County, Florida. The grove consisted of approximately 52 acres of red grapefruit trees. The Crop Agreement made no reference to the duration of the agreement. The separate Lease Agreement between Higgins and Pomco expressly stated that the lease ended one year from the date of signing. Higgins provided Respondent with a copy of his July 5, 1990 Crop Agreement and Lease Agreement with Pomco. Respondent thereafter accepted citrus fruit from Higgins which was harvested in the Pomco grove in the 1991-1992 season, and Respondent paid Higgins for the citrus fruit from the Pomco grove at that time. In 1992 and early 1993, Higgins informed Phillip Conant, a Vice- President and Director of the Grower Division of Respondent, that Higgins was a holdover lessee under the Pomco lease, and was entitled to harvest the fruit from the Pomco grove. Under Higgins' contract with Respondent, Respondent was required to provide Higgins with harvesting equipment including trailers and boxes. Respondent was further required under the contract to accept and market the citrus fruit on Higgins' behalf. Respondent advanced Higgins $2,400 toward the marketing of the citrus fruit from the Pomco grove. On January 23, 1993, Higgins requested that Respondent provide him with trailers and boxes to set up Higgins' crew for harvesting the Pomco grove. Respondent complied with Higgins' request, and dispatched a truck and trailer with a load of boxes to the Pomco grove. The truck, trailer and boxes were clearly marked and identified as belonging to Respondent. Prior to this time, on or about December 2, 1992, Petitoner, by and through its President, James Thompson, Jr., had entered into a Purchase Contract and Agreement for the citrus fruit on the same Pomco grove in Manatee County, Florida, for the 1992-1993 season. Under the terms of the contract, Petitioner advanced Pomco $3,000 toward the purchase of the citrus fruit from the Pomco grove. Shortly after Respondent dispatched its equipment to the Pomco grove on January 23, 1993, Thompson was informed that citrus fruit was being harvested from the Pomco grove. Thompson went to the grove, observed the boxes and trailers which were identified as belonging to Respondent, and called Phillip Conant to inform Conant that Thompson had a purchase contract and agreement for the citrus fruit from the Pomco grove. Thompson furnished Conant with a copy of the Petitioner's contract with Pomco. Thompson also contacted the Manatee County Sheriff's Department to remove Higgins' harvesting crew from the Pomco grove. Respondent, by and through its director, Conant, then contacted Higgins who stated that he had obtained a legal opinion that as a holdover lessee under his prior crop agreement and lease with Pomco, he had a right to harvest the fruit from the Pomco grove. Higgins further stated that he expected Respondent to fulfill its contractual obligations to provide harvesting services and to market the citrus fruit. Conant, by telephone, informed Thompson that in light of Higgins' representations, Respondent was unsure as to whether Higgins or Petitioner had a right to harvest the fruit. In response to this information, Thompson stated that he would pursue judicial remedies to resolve the dispute. By letter dated February 4, 1993, Conant confirmed to Thompson that Respondent was taking a "hands off" position as to the dispute between Petitioner and Higgins over the citrus fruit from the Pomco grove. On February 5, 1993, Conant also sent a facsimile copy of the February 4, 1993, letter to Thompson and reiterated to Thompson that Respondent was not knowledgeable of the facts of Petitioner's dispute with Higgins, and would not be involved in the dispute. Between February 7, 1993, and February 13, 1993, Respondent accepted three shipments of citrus fruit from the Pomco grove harvested by Higgins. The three shipments totalled 1,230 boxes. All the fruit accepted by Respondent from the Pomco grove was red grapefruit. At that point in the season, the market for red grapefruit was not good. The net value received by Respondent for the red grapefruit from the Pomco grove was $.9889 per box. A reasonable average price for red grapefruit at that time was $.97 per box. Respondent received a reasonable price per box for the red grapefruit from the Pomco grove during the 1992-1993 shipping season. Respondent received a total of $2,418.86 for the red grapefruit from the Pomco grove. The harvesting costs incurred by Respondent during the 1992- 1993 relating to the Pomco fruit were $1,402.40, leaving a balance of $1,216.34. Respondent has placed the funds received from the Pomco grove fruit during the 1992-1993 shipping season in its escrow account pending a determination as to who is the rightful owner of the funds. Respondent has provided an accurate accounting of the harvesting and marketing of the Pomco grove citrus fruit during the 1992-1993 season. There has not been a judicial resolution of the dispute between Petitioner and Higgins.
Recommendation Based on the foregoing findings of fact and conclusions of law, it is RECOMMENDED that: The Department of Agriculture and Consumer Services enter a Final Order pursuant to Section 601.66(4), Florida Statutes, dismissing the proceeding. RECOMMENDED in Tallahassee, Leon County, Florida, this 18th day of May, 1995. RICHARD HIXSON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 18th day of May, 1995. APPENDIX Respondent's Proposed Findings: Paragraphs 1 through 21 adopted and incorporated. Paragraphs 22 revised as to amount remaining due. COPIES FURNISHED: Commissioner Bob Crawford Commissioner of Agriculture The Capitol, PL-10 Tallahassee, FL 32399-0810 Brenda Hyatt, Chief Department of Agriculture and Consumer Services Mayo Building, Room 508 Tallahassee, FL 32399-0800 Richard Tritschler, Esquire Department of Agriculture and Consumer Services The Capitol, PL-10 Tallahassee, FL 32399-0810 Jerri A. Blair, Esquire Post Office Box 130 Tavares, FL 32778 Ray Mattox, Esquire 170 East Central Avenue Post Office Box 917 Winter Haven, FL 33882-0917 Golden Gem Growers Post Office Box 9 Umatilla, FL 32784 Fidelity & Deposit Company of Maryland Post Office Box 1227 Baltimore MD 31203
The Issue The issue in this case is whether proposed Florida Administrative Code Rule 64-4.002 (the “Proposed Rule”) is an invalid exercise of the legislative authority delegated to the Department of Health (the “Department”).
Findings Of Fact In order to better contextualize the facts presented at final hearing and discussed below, the following excerpts from the Proposed Rule and the underlying statutory provision are provided: Section 381.986, Florida Statutes (8) Medical Marijuana Treatment Centers.- (a) The department shall license medical marijuana treatment centers to ensure reasonable statewide accessibility and availability as necessary for qualified patients registered in the medical marijuana use registry and who are issued a physician certification under this section. * * * The department shall license as medical marijuana treatment centers 10 applicants that meet the requirements of this section, under the following parameters: [Previously denied applicants meeting certain requirements not relevant to the instant action.] [One applicant from a specific class pursuant to a federal lawsuit.] As soon as practicable, but not later than October 3, 2017, the Department shall license applicants that meet the requirements of this section in sufficient numbers to result in 10 total licenses issued under this subparagraph, while accounting for the number of licenses issued under sub-subparagraphs a. and b. For up to two of the licenses issued under subparagraph 2., the department shall give preference to applicants thatdemonstrate in their applications that they own one or more facilities that are, or were, used for the canning, concentrating, or otherwise processing of citrus fruit or citrus molasses and will use or convert the facility or facilities for the processing of marijuana. (Emphasis added). Florida Administrative Code Rule 64-4.002 (Proposed) (1)(f) For applicants seeking preference for registration as a medical marijuana treatment center pursuant to ss. 381.986(8)(a)3., F.S., the applicant must provide evidence that: The property at issue currently is or was previously used for the canning, concentrating, or otherwise processing of citrus fruit or citrus molasses. In order to demonstrate the property meets this criteria, the applicant may provide documentation that the applicant currently holds or has held a registration certificate pursuant to section 601.40, F.S. A letter from the Department of Citrus certifying that the property currently is or was previously used for the canning, concentrating, or otherwise processing of citrus fruit or citrus molasses will be accepted as sufficient evidence. The applicant as an individual holds, in his or her name, or the applicant as an entity holds, in the legal name of the entity, the deed to property meeting the criteria set forth in subparagraph 1. above; and A brief explanation of how the property will be used for purposes of growing, processing, or dispensing medical marijuana if the applicant is selected for registration. * * * Subject matter experts will substantively and comparatively review, evaluate, and score applications using [the Scorecard incorporated by reference]. * * * (a)7.(b) Scores for each section of the application will be combined to create an applicant’s total score. The department will generate a final ranking of the applicants in order of highest to lowest scores . . . . (c) In accordance with ss. 391.986(8)(a)3., F.S., the two highest scoring applicants that own one or more facilities that are, or were, used for the canning, concentrating, or otherwise processing of citrus fruit or citrus molasses and will use or convert the facility or facilities for the processing of medical marijuana will receive an additional35 points to their respective total score. Licenses will be awarded, subject to availability as set forth in ss. 381.986(8)(a)2. and 381.986(8)(a)4., F.S., based on the highest total score in the following manner: The highest scoring applicant that is a recognized member of the Pigford or [the Black Farmers Discrimination Litigation] will receive a license. The remaining highest scoring applicants, after the addition of the preference points for applicants pursuant to paragraph (7)(c) above, will receive licenses up to the statutory cap set forth in ss. 381.986(8)(a)2., F.S. The remaining highest scoring applications, after removing any preference points received under paragraph (7)(c), will receive licenses up to the statutory cap . . . . (Emphasis added). The Department is an agency of the State of Florida charged with administering and enforcing laws related to the general health of the people of the state. § 381.0011(2), Fla. Stat. As part of this duty, the Department is charged with implementing the Compassionate Medical Cannabis Act of 2014. See § 381.986, Fla. Stat. Favero is a Florida corporation in good standing since its incorporation in 1974, primarily engaged in the business of growing orchids. Favero aspires to file an application for licensure as a medical marijuana treatment center (“MMTC”). Following the passage of Senate Bill 8A by the 2017 Florida Legislature, which substantially rewrote section 318.986, Florida Statutes, Favero decided to seek the citrus preference described in section 381.986(3)(a)3. (hereinafter referred to as the “Preference Statute”). To that end, Favero purchased a citrus processing business in Safety Harbor, Florida, for approximately $775,000, including the business’s real property and all facilities located thereon. The purchase took place prior to publication of the Proposed Rule. The purchase of the Safety Harbor property reduced Favero’s financial liquidity but, presumably, not its net worth as the value of the property would replace the cash expenditure made for the purchase. It is Favero’s intent to convert the citrus processing facility located on the property into a medical marijuana processing facility if Favero receives the requisite license as a MMTC. Favero contends, as stated in the following paragraphs of its Petition Challenging the Invalidity of Proposed Rule 64-4.002: The Proposed Rule grants a preference to an applicant who owns “property” that was once used for citrus processing. The statute, however, clearly grants the preference only to applicants who “own one or more facilities that are, or were, used for the canning, concentrating, or otherwise processing ” By using the broader word “property” rather than “facility,” the Department is granting the citrus preference to a broader group of applicants than the statute permits, such as owners of packinghouses and other properties that fail to meet the definition of “processor” or were not used for “canning” or “concentrating.” The statute is clear and unambiguous. The use of the word “property” rather than the statutory term “facilities” renders the rule invalid because the use of that term exceeds the Department’s rulemaking authority, enlarges and modifies and contravenes the requirements of Section 381.986(8)(a)3., is vague, fails to establish adequate standards for agency decisions, vests unbridled discretion in the agency and is arbitrary and capricious. See § 120.52(8)., Fla. Stat. * * * The Proposed Rule allows for a preference to only some applicants that own a citrus processing facility. Under the scoring system, applicants demonstrating that they own a citrus processing facility may receive an additional 35 points. However, the Proposed Rule does not guarantee that any applicant owning a citrus processing facility will actually receive those points or get a license. The Proposed Rule merely grants an additional 35 points to two applicants. The Department of Citrus has indicated that more than a dozen companies will qualify for the citrus preference. Under the Proposed Rule, most of those applicants would receive no additional points despite qualifying for the statutory preference. Additionally, the Proposed Rule provides no assurance that any applicant qualifying for the citrus preference will actually receive a license. The Form adopted by the Proposed Rule allows Department evaluators to award a maximum of 1,150 points in several categories. The additional 35 points available under the Proposed Rule amount to an addition of just a 3% bonus. If those extra 35 points are not enough to exceed the scores of other applicants, then no citrus-preference qualifying applicant will receive a license. Favero contends that reduction of its liquid assets could have a negative impact on its overall financial condition when considered by the Department as it reviews Favero’s MMTC application. Favero is concerned that this negative impact may not be completely offset by the citrus preference it is seeking. Mecca is a Florida corporation located at 7965 Lantana Road, Lantana, Florida. It has existed since November 15, 1973, has operated in Florida since the early 1970s, and began citrus farming on approximately 2,000 acres in 1983. Mecca has been and is currently licensed as a citrus dealer and a regulated citrus processing plant and citrus packinghouse. The “processing” done by Mecca does not involve canning or concentrating citrus. Mecca “processes” citrus in its “fresh fruit form” (discussed more fully below). Mecca intends to convert its property and facilities for the purpose of growing, processing or dispensing medical marijuana if its application for an MMTC license is approved. Mecca contends the citrus preference in the Proposed Rule needs further clarification. Mecca also asserts the evaluation and scoring system with respect to the citrus preference constitutes an invalid exercise of the Department’s delegated legislative authority. The Scoring System The MMTC application has 16 separate sections. An applicant may be awarded up to 50 points on some sections, up to 100 points on other sections. The total number of points any application might receive is 1150, presuming a perfect score on each section. Each of the individual sections, whether for 50 or 100 points, is graded in accordance with an evaluation rubric. The rubric contains five categories of scores which are used by reviewers, allowing for a range of points in each section. The five categories each have a range depending on whether the section allows 50 or 100 points. The rubric directs that a category 5 response could be awarded between 40 and 50 points in the 50-point sections, or between 80 and 100 points in a 100-point section. A category 4 response could get between 30 and 39 points (or 60 to 79 points); a category 3 could award 20 to 29 points (or 40 to 59 points); a category 2 could be worth 10 to 19 points (or 20 to 39 points); and a category 1 might award 0 to 9 points (or 0 to 19 points). Thus, an applicant may be awarded points anywhere within the range in each category for each section of the application. By way of example, category 5 under the rubric (wherein a reviewer may give an application 40 to 50 or 80 to 100 points) directs the reviewer as follows: Applicant addressed all items. When necessary, each item has multiple, specific examples of experience and knowledge. Experience and knowledge are connected to specific, identifiable people in the application. Plans are clear, detailed, well documented, and thorough. All charts, photographs, maps, sketches, and other supplemental information are clear and legible. When necessary, applicant provides full documentation for representations of future performance. Responses related to financial reflect robust financial resources and clear lines of authority within the organizations. By comparison, under Category 3, which could award 20 to 29 or 40 to 59 points, the rubric directs the reviewer to consider: Either: Applicant responded to all items. Applicant responds to items addressing experience and knowledge, though answers tend to lack specificity. Plans are provided, but are lacking in clarity, documentation, or thoroughness. When necessary, some supplemental information is provided. Responses related to financials do not reflect robust financial resources, but do not raise doubts of applicant’s financial viability, or the organization has unclear lines of authority, or; Most responses are sufficient to be considered Category 4 or 5 Responses, but applicant fails to address some items. Favero asserts that allowing a reviewer to award points from an allowable range gives unbridled discretion to the Department. The argument misses the point that the ranges in each category direct the reviewer on how to score, while allowing some leeway in determining which applications are slightly better or worse than their competitors. Depending on the strength or weakness of one applicant’s response vis-à-vis another applicant, it is reasonable to assign more or fewer points in a comparative review. The rubric is quite descriptive and allows for a nuanced review of responses by the Department reviewers. The Preference The Preference Statute asserts a preference “for up to two of the licenses issued,” i.e., past tense. There are no licenses “issued” during the application review process, so the preference is actually assigned before licensure. The Preference Statute is somewhat confusing in this regard. The Proposed Rule attempts to reconcile this discrepancy by assigning preference points as a part of the application review process, while still approving the most qualified applicants. That approach is reasonable and has merit; it allows the preference to be assigned but does not attempt to insert it into the actual licensure process. The Proposed Rule assigns the preference points at the end of the review, i.e., after an application receives its “total score.” Thus, an applicant could conceivably be awarded 1185 points on the 0 to 1150 point scale. Regardless of how the points are assigned, Favero contends that the 35 preference points are too insignificant as compared to a possible (perfect) score of 1150 during application review. That number of points (35) would be only about three percent of a perfect score. The lower the average scores of all applications, however, the more the 35 points might come into play. If all applicants received an average score of 575 total points, the preference points would be twice as important as compared to perfect 1150 scores. The assignment of the preference points only after totaling the scores is a legitimate and acceptable method. Taking the 16 sections of the application separately, 35 points assigned in any one section could be quite significant. In fact, the Department arrived at the 35 points by taking the average number of possible points per section, i.e., 72, and assigning approximately half of that amount to reach the 35- point preference. The preference points are not just an arbitrary number assigned by the Department. Favero also objects that the Proposed Rule only assigns the 35 preference points to the two highest scoring, eligible applicants, i.e., those who will convert a citrus facility to process medical marijuana. If those two eligible applicants were more than 35 points below other, non-eligible applicants’ scores, assignment of the preference points would not result in the approval of any eligible applicants. The plain language in the Preference Statute and the Proposed Rule allows for a preference of “up to two” applicants. There is, therefore, no mandate that any applicants must receive the preference. While the Legislature can be presumed to have wanted preference points to be awarded (else why would the Preference Statute exist?), the language of the statute merely limits the number of entities which could get such a preference. The Department, interpreting a statute it is charged with implementing, interprets section 381.986(8)(a)3. to mean the issuance of available licenses to as many as two entities which are eligible for the preference. The Proposed Rule allows the Department to assess an applicant’s entitlement to the preference, to assign the preference, and to meet its statutory obligation. Property versus Facility The Legislature clearly intended to give a preference to applicants who “own . . . facilities that are, or were, used for canning, concentrating, or otherwise processing of citrus . . . and will use or convert the . . . facilities for the processing of medical marijuana.” The Legislature failed, however, to provide guidance by way of definitions. While the Legislature chose the words “facility or facilities” in the Preference Statute, the Department complicated the issue by using the word “property” for the most part, but also using the words “facility” and “facilities” at times. Favero contends that a property is much broader in scope than a facility, and the Department therefore exceeded its delegated legislative authority. The Department argues that facilities used to process citrus must be located on some property, obviously. But, facilities located on a property might be leased, so that the fee simple owner of the property is different from the leaseholder of that facility. Thus, if an applicant for a medical marijuana treatment center license wants to avail itself of the preference, it would need to own the facility. Whether that means the applicant must own the property on which the facility is located is not clear in the Preference Statute or in the Proposed Rule. The Department argues that the way to show ownership of a facility is by way of a deed to the property on which the facility is located. In fact, Favero will use a warranty deed to prove ownership of the facilities it purchased in order to obtain the preference. But if Favero purchased land on which citrus had been grown but not processed, i.e., if there had been no facilities on the land to can, concentrate or otherwise process the fruit, except in fresh fruit form, the preference would not apply. And if an applicant obtained a leasehold interest in a facility, it would not be able to “show ownership” by way of a deed to the property. The Preference Statute requires the applicant to convert the facility in order to gain the preference. It is unclear how a piece of unimproved property can be “converted” to another use; land is land. This begs the question of whether growing citrus on a piece of property, and then removing all the citrus trees in order to grow medical marijuana, is a “conversion” of a facility as contemplated by the Legislature. Neither the Preference Statute nor the Proposed Rule contain any definitional assistance to answer that question. An important question to be answered is whether the growing of citrus constitutes “processing” as alluded to by the Legislature. The Preference Statute provides no definition of the word. The Citrus Code (chapter 601, Florida Statutes) also does not define “processing,” but does describe a “processor” of citrus as: ‘[A]ny person engaged within this state in the business of canning, concentrating, or otherwise processing citrus fruit for market other than for shipment in fresh fruit form.” § 601.03(32), Fla. Stat. (Emphasis added). Processing must therefore mean something other than merely growing citrus and packing it up for shipment. That being the case, a property where citrus is grown that is “converted” to a property growing marijuana would not afford an applicant a preference. There must be some “facility” that is or has been used to process citrus, i.e., doing something more with the raw product, in order to constitute “processing.” Therefore, a “packinghouse,” i.e., “[a]ny building, structure, or place where citrus fruit is packed or otherwise prepared for market or shipment in fresh fruit form,” would not be engaged in “processing” citrus. See § 601.03(29), Fla. Stat. Mecca, which owns property where citrus was grown, picked, graded, sorted, polished, cleaned and packaged for transfer “in fresh fruit form,” would not be a processor, either. Mecca owns a packinghouse only, not a processing facility as that term seems to be used by the Legislature. Its operations were not part of the “canning, concentrating, or otherwise processing citrus fruit other than for shipment in fresh fruit form.”
The Issue The issue for determination is whether Department of Citrus Rules 20-1.009 and 20-1.010, Florida Administrative Code, are invalid exercises of delegated legislative authority, as alleged by Petitioners.
Findings Of Fact John Stephens, Inc., Petitioner, was at all times material hereto a Florida corporation duly licensed as a citrus fruit dealer in the State of Florida. J. A. Stephens, Inc., was a Florida corporation, and held a valid fruit dealer’s license in the State of Florida. At all times material to this proceeding, Petitioner, John A. Stephens, served as an officer and director of J. A. Stephens, Inc. John A. Stephens is not an officer, director or shareholder of John Stephens, Inc. John A. Stephens, Jr. is the president and sole director of John Stephens, Inc. and is not an officer, director nor shareholder of J. A. Stephens, Inc. On or about September 26, 1996, Petitioners, John Stephens, Inc., and John A. Stephens, applied to the Florida Department of Agriculture and Consumer Services to register John A. Stephens as an agent of John Stephens, Inc., pursuant to Section 601.601, Florida Statutes. The application form furnished by the Department of Agriculture and Consumer Services indicates that the licensed dealer seeking registration of an agent agrees to “... accept full responsibility for all his activities....” (Petitioners’ Exhibit 1) By letter dated December 26, 1996, Petitioners were advised by the Department of Agriculture and Consumer Services that their application for registration of John A. Stephens as an agent of John Stephens, Inc., had been denied on the basis of Rule 20-1.010, Florida Administrative Code. As indicated in the notice, that rule provides, in part, that an application for registration of a dealer’s agent can be disapproved if a proposed registrant has a “...record, either as an individual, co- partnership, corporation, association or other business unit, showing unsatisfied debts or orders issued by the Commissioner of Agriculture with respect to prior dealings in citrus fruit.” (Petitioners’ Exhibit 1.) Specifically, the Department of Agriculture and Consumer Services advised Petitioners that “...Mr. Stephens has not satisfied orders issued by the Commissioner of Agriculture with respect to prior dealings in citrus fruit...,” listing as the final orders in question Petitioners’ Exhibits 3 through 14. Between April 30, 1991, and September 30, 1992, the State of Florida, Department of Agriculture and Consumer Services entered a total of 12 final administrative orders in which it found that J. A. Stephens, Inc., was indebted to claimants for various sums arising from prior dealings in citrus fruit. (Petitioners’ Exhibits 3 through 14.) At the time of the action of the Department of Agriculture and Consumer Services denying Petitioners’ application, there remained amounts due and unpaid on each of the orders entered by the Department against J. A. Stephens, Inc. Petitioner, John A. Stephens was not named as a party respondent in any of the 12 proceedings culminating in final orders against J. A. Stephens, Inc., which formed the basis for the denial by the Department of the application for registration as a citrus dealer’s agent. (Petitioners’ Exhibits 2, and 3 through 14.) In denying a Motion for Relief for Final Order in the only Department of Agriculture and Consumer Services proceeding in which a claimant sought to join Mr. Stephens individually as a party, the Department found that: The complaint filed by Claimant named J. A. Stephens, Inc. as the respondent. Because the complaint was against J. A. Stephens, Inc., it was served on J. A. Stephens, Inc. J. A. Stephens, an individual, was never subjected to the jurisdiction of the Agency with regard to this matter. J. A. Stephens, an individual, was not afforded an opportunity to defend against the allegations of the complaint. There was no discussion at the hearing about whether J. A. Stephens, Inc. was or was not the proper respondent. There was no allegation at the hearing that J. A. Stephens, an individual, was the proper respondent. The Claimant has failed to express any legal basis for grant of his motion and this Agency could find no such basis. This Agency has no personal jurisdiction over J. A. Stephens, an individual, with regard to this matter and therefore cannot enter an order with respect to him. Further, even if such an order were to be entered, it would be of no force or effect because of the lack of personal jurisdiction. (Petitioners’ Exhibit 4, pg. 2.) The rules that are the subject of this proceeding had their inception in 1964, when the Florida Citrus Commission considered and adopted rules governing the registration of agents acting on behalf of licensed citrus dealers. These rules, which appear in the text of the minutes of the Commission as Regulation 105-1.05, are almost verbatim the same rules now found in Chapter 20-1, Florida Administrative Code. (Respondent’s Exhibits 1 and 2.) As reflected in the minutes of the Florida Citrus Commission, the rules were adopted to help protect the grower and shipper or processor in matters involving the normal movement of citrus fruit in all channels of distribution. The regulation was recommended by the Fresh Citrus Shippers Association and was endorsed by a resolution of the Florida Sheriffs Association. In presenting the Sheriffs’ resolution to the Commission, Sheriff Leslie Bessenger of the Florida Citrus Mutual Fruit Protection Division cited the results of a seven-month investigation that found 71 out of 200 registered agents with criminal records. Those two hundred agents represented only nine dealers. (Respondent’s exhibit 1, June 19, 1964, meeting.) Minutes of Commission meetings after rule adoption thoroughly explain the efforts to require accountability and curb abuse of the dealer- agent relationship. The rules, as they appear today in the Florida Administrative Code, have not been revised since July 1, 1975.
Findings Of Fact Upon consideration of the oral and documentary evidence adduced at the hearing, the following relevant facts are found: Citrus Hill Manufacturing Company (Citrus Hill) is a wholly owned subsidiary of Proctor and Gamble. Citrus Hill is in the business of producing, manufacturing, packaging and distributing citrus products throughout the United States. It's main product has been "Select" orange juice which is 100 percent orange juice. Its principal manufacturing facility is located in Frostproof, Florida. While Citrus Hill has four other manufacturing sites outside the State of Florida, its Florida plant is the only facility for manufacturing frozen products. While it can produce chilled products at its plants located outside Florida, Citrus Hill's Florida plant is necessary to supply the demand for its chilled products on a national basis. In an effort to expand its market, Citrus Hill developed three products which it produces and packs at its plant in Frostproof, Florida. These products are and have been labeled as follows: "Lite Citrus Hill Orange Juice Beverage - 60 percent Orange Juice," "Lite Citrus Hill Grapefruit Juice Beverage - 45 percent Grapefruit Juice," and "Plus Calcium Citrus Hill, Calcium Fortified Grapefruit Juice Beverage - 60 percent Grapefruit Juice." The "lite" beverages are reduced calorie diluted juice beverages with the addition of Nutrasweet. The third product is a diluted grapefruit juice beverage fortified with calcium. By a letter dated March 19, 1987, the Department of Citrus ordered Citrus Hill to change its diluted citrus products labels and informed Citrus Hill that the Department would enforce Rule 20-66.001(4), Florida Administrative Code. That rule provides "Labels for diluted citrus products shall not include the word "juice" in the name of the product." As noted above, Citrus Hill markets and sells its product line throughout the United States. It desires to utilize the names of its diluted juice products as indicated in paragraph two above for three reasons. First, Citrus Hill believes that its labeling is in compliance with federal law. Second, it believes that a product name which includes the word "juice" more fully informs the consumer of the nature of the product because it is more exact, descriptive and less ambiguous than any name not using the word "juice", such as "drink", "ade", or "beverage". Third, Citrus Hill fears that if it were unable to disclose through its product name that the product is primarily a juice product, it would be placed at a competitive disadvantage in the national marketplace where non-Florida producers of similar products would not be bound by the challenged Rule's ban on the use of the word "juice" in the name of diluted juice products. While Citrus Hill could move its packaging facilities outside the state and utilize two product labels (one for Florida shipment and one for the non-Florida market), this alternative would be extremely expensive and would constitute a "distribution nightmare." Many distributors and large retail grocery stores work in multi-state regions and may not be willing to segregate and keep track of petitioner's different product labels for shipment in Florida and in non-Florida states. No other state in the United States prohibits the word "juice" in the labeling of diluted citrus juice products. In the late 1960's and early 1970's, the subject of proper labeling of diluted fruit juice beverages was under discussion by both the Florida Department of Citrus and the Federal Food and Drug Administration (FDA) under the Food, Drug and Cosmetic Act. The FDA ultimately rejected the proposal of prohibiting the word "juice" from the name of any product that was not 100 percent pure juice, and also rejected the approach of defining different products through "standards of identity." This latter method of labeling products would have defined a product as "ades" only if containing more than 10 percent, but less than 20 percent, juice, and various other category names based upon the percentage of fruit juice contained in the product. The prohibition against the word "juice" and the "standards of identity" proposals for the labeling of diluted juice products were rejected by the FDA in favor of a common or usual name approach, with a percent declaration of any characterizing ingredient. The pertinent federal regulations addressing the labeling of food products are contained in 21 C.F.R. Chapter 1. The more general regulation appears in 21 C.F.R. 102.5(a) and (b), and states, in pertinent part, as follows: Section 102.5 General Principles. The common or usual name of a food . . . shall accurately identify or describe, in as simple and direct terms as possible, the basic nature of the food or its characterizing properties or ingredients. The name shall be uniform among all identical or similar products and may not be confusingly similar to the name of any other food that is not reasonably encompassed within the same name. Each class or subclass of food shall be given its own common or usual name that states, in clear terms, what it is in a way that distinguishes it from different foods. The common or usual name of a food shall include the percentage(s) of any characterizing ingredient(s) or component(s) when the . . . component(s) . . . has a material bearing on . . . consumer acceptance or when the labeling . . . may otherwise create an erroneous impression that such . . . component(s) is present in an amount greater than is actually the case. The following requirements shall apply unless modified by a specific regulation in Subpart B of this part. The percentage of a characterizing ingredient or component shall be declared on the basis of its quantity in the finished product. . . . The percentage of a characterizing ingredient or component shall be declared-by the words "containing (or contains) --- percent (or percent) ---" . . . with the first blank filled in with the percentage expressed as a whole number not greater than the actual percentage of the ingredient or component named and the second blank filled in with the common or usual name of the ingredient or component. The FDA has also promulgated regulations dealing with the labeling of specific nonstandardized foods, including diluted orange juice beverages and diluted fruit or vegetable juice beverages other than diluted orange juice beverages. With respect to diluted orange juice beverages, 21 C.F.R. Section provides as follows: Diluted Orange Juice Beverages. The common or usual name of a non- carbonated beverage containing less than 100 percent and more than 0 percent orange juice shall be as follows: A descriptive name for the product meeting the requirements of Section 102.5(a) (e.g., diluted orange juice beverage or another descriptive phrase), and A statement of the percent of each juice contained in the beverage in the manner set forth in Section 102.5(b)(2). The percent of the juice shall be declared in 5 percent increments, expressed as a multiple of five not greater than the actual percentage of orange juice in the product, except that the percent of orange juice in products containing more than 0 percent but less than 5-percent orange juice shall be declared in the statement as "less than 5" percent. Diluted fruit or vegetable juice beverages other than diluted orange juice beverages are the subject of 21 C.F.R. Section 102.33, 1/ which provides as follows: Diluted fruit or vegetable juice beverages other than diluted orange juice beverages. The common or usual name of a non- carbonated beverage containing less than 100 percent and more than zero percent fruit or vegetable juice(s), other than only orange juice, shall be as follows: A descriptive name meeting the requirements of Section 102.5(a)(e.g., "diluted grape juice beverage", "grape juice drink", or another descriptive phrase) and A statement of the percent of each juice contained in the beverage in the manner set forth in Section 102.5(b)(2). The percent of the juice shall be declared in five percent increments, expressed as a multiple of five not greater than the actual percentage of juice in the beverage except that the percentage of any juice in beverages containing more than zero percent but less than 5 percent of that juice shall be declared in the statement as "less than 5" percent. The Department of Citrus has conducted two consumer surveys for the purpose of determining whether the word "juice" in a product name of a diluted citrus juice product is confusing or misleading. The Drossler study was conducted in 1972, and concluded that consumers are confused by the word "juice." However, that conclusion appears to be founded on the premise that the only proper use of the word "juice" is in the technical sense of "100 percent pure juice." In other words, what was measured in the survey was the consumer's failure to use the word "juice" in a limited sense to mean "100 percent pure juice." The surveyed consumer was asked to look at several products, and then state "what kind of product is this?" The products viewed consisted of several different dairy products and a citrus beverage. If the consumer used the word "juice" to describe the kind of product pointed to, he was treated as being confused if the product was less than 100 percent juice. No follow-up questions were asked concerning the consumer's understanding of the content of the product. The Chelsea study was conducted at the request of the Department of Citrus in 1987. It, too, concludes that there would be less consumer confusion if the word "juice" were eliminated from products comprised of less than 100 percent pure citrus juice. However, there was evidence that this study attempted to address too many issues, including consumer preferences, and that "question contamination" could well have occurred. This refers to the intentional or unintentional biasing of the interviewees by the ordering or phraseology of the questions asked. Both the Burke study and the Chelsea study indicate that consumers are not confused by a beverage label using the word juice in the product name when it is accompanied by the declaration of the percentage of juice contained in the product. The Burke study was conducted on behalf of the petitioner in 1987. After conducting interviews of 1200 people from all age groups in six different cities throughout the United States, it concluded that there was no significant difference in consumer confusion between the use of the word "juice" and "beverage" in the product name when the percentage of citrus juice content is indicated on the label. In other words, whether the label identified the product as a "juice beverage" or a "beverage", the respondents were able to determine the amount of actual juice contained in the product.
The Issue Whether Sunny Fresh Citrus Export and Sales, Co., LLC, is liable to Petitioner in the amount of $44,032.00 for delivery of fruit which remains unpaid.
Findings Of Fact Petitioner, DP Partners, Ltd. (Partners), is a Florida Limited Partnership located in Lake Placid, Florida, engaged in the business of citrus production. Daniel H. Phypers and Danielle Phypers Daum, brother and sister, and their father Drew Phypers, are limited partners in the business. Respondent, Sunny Fresh Citrus Export and Sales Co., LLC, (the LLC) is a Florida Limited Liability Company headquartered in Vero Beach, Florida, engaged in the business of exporting citrus for retail sale. The LLC was organized and registered with the State of Florida Division of Corporations on November 3, 2011. The members of the LLC are Kelly Marinaro and Jean Marinaro, husband and wife. Kelly Marinaro (Marinaro) formerly conducted business in the name of Sunny Fresh Citrus Export and Sales Co. (the DBA), a fictitious-name entity registered with the Florida Department of State, Division of Corporations, on October 23, 2007. The fictitious-name entity registration expired on December 31, 2012. Marinaro suffered a massive heart attack in November 2011 and was incapacitated. He did not return to work until the Spring of 2013. On November 4, 2011, after suffering the heart attack, and one day after organizing and registering the LLC, Marinaro conveyed durable power of attorney to Joseph Paladin (Paladin) as his Agent. Among the authority granted to Paladin, was the following: 2. To enter into binding contracts on my behalf and to sign, endorse and execute any written agreement and document necessary to enter into such contract and/or agreement, including but not limited to . . . contracts, covenants . . . and other debts and obligations and such other instruments in writing of whatever kind and nature as may be. * * * 9. To open, maintain and/or close bank accounts, including, but not limited to, checking accounts . . . to conduct business with any banking or financial institution with respect to any of my accounts, including, but not limited to, making deposits and withdrawals, negotiating or endorsing any checks . . . payable to me by any person, firm, corporation or political entity[.] * * * 12. To maintain and operate any business that I currently own or have an interest in or may own or have an interest in, in the future. In Marinaro’s absence, Paladin conducted the usual affairs of the business, including entering into contracts to purchase citrus from several growers. On October 19, 2012, Paladin entered into contract number 2033 with Partners to purchase approximately 6000 boxes of Murcots (a tangerine variety) at $12.00 per box.2/ The contract is signed by Paladin as the Agent of “Sunny Fresh Citrus Export & Sales Company, Licensed Citrus Fruit Dealer (Buyer).” On December 13, 2012, Sunny Fresh entered into contract number 2051 with Partners to purchase Hamlins (a different fruit variety) at $6.50 per box.3/ The contract price was for citrus “on the tree,” meaning it was the buyer’s responsibility to harvest the citrus. The contract is signed by Paladin as the Agent of “Sunny Fresh Citrus Export & Sales Company, Licensed Citrus Fruit Dealer (Buyer).” (Contract 2033 and 2051 are hereinafter referred to collectively as “the contracts”.) The contracts were prepared on pre-printed forms used by Marinaro’s businesses pre-dating Paladin’s involvement. The contract form is titled as follows: Citrus Purchase Contract & Agreement Sunny Fresh Citrus Export & Sales Company Cash Fruit Crop Buyer 2101 15th Avenue Vero Beach, Florida 32960 Paladin testified that he was not aware of more than one company for Marinaro’s fruit-dealing business. He testified that he was not aware of any difference between Sunny Fresh Citrus Export and Sales Company and Sunny Fresh Citrus Export and Sales Co., LLC. Paladin was not aware of when the LLC was created. Paladin’s testimony is accepted as credible and reliable. Paladin testified that his intent was to enter into the contracts for the benefit of “Sunny Fresh.” “Sunny Fresh,” written in twelve-point bold red letters over an image of the sun in yellow outlined in red, is a trademark registered with the Florida Division of Corporations. Marinaro first registered the trademark in February 1998. In his trademark application, Marinaro entered the applicant’s name as “Kelly Marinaro D/B/A Sunny Fresh Citrus.” Marinaro renewed the trademark registration in 2007. Marinaro testified that the “Sunny Fresh” trademark is “owned by the LLC.” On February 20, 2012, Paladin, Marinaro and a third partner, Gary Parris, formed another company, Sunny Fresh Packing, LLC, the purpose of which was to run a fruit-packing house in Okeechobee, Florida. Equipment for the packing house was obtained from a packing house in Ft. Pierce, Florida, which was indebted to Marinaro, in some capacity, and went “belly up.” In March 2013, the Okeechobee packing house was struck by lightning. Shortly after the lightning strike, Marinaro, Paladin, and Mr. Parris, signed a letter addressed “To our valued Growers.” The letter explained that, due to both the lightning strike, which shorted out all computers and electrical components at the packing house, and reduced demand for product due to severe weather in the northeastern United States, they had made a “business decision to end the year now and prepare for next year.” The letter further explained that, “rather than spending thousands of dollars all at once, we feel, it makes better sense to use our cash flow to pay our growers first . . . . We will be sending out checks every week or every other week until everyone is paid or until we receive supplemental cash infusions that we are working on. In that case we would just pay everyone in full, from that.” The letter was prepared on letterhead bearing the “Sunny Fresh” trademark logo. Paladin made a number of payments to Partners on the contracts during 2012 and 2013. Each check shows payor name as “Sunny Fresh” with an address of 2101 15th Avenue, Vero Beach, Florida 32960. Mr. Phypers met with Paladin a number of times to collect checks and understood that Paladin was making concerted efforts to pay all the growers. However, Partners did not receive full payment on the contracts. Paladin drafted a Release of Invoices Agreement (Agreement) by which creditor growers could receive partial payment on their outstanding contracts in exchange for a full release of liability from the buyer. The Agreement lists the following entities and persons as being released from liability: “Sunny Fresh Packing, LLC”; “Sunny Fresh Citrus Export and Sales Co., LLC”; and Kelly Marinaro. Paladin presented the Agreement to Partners with an offer to pay $36,449.45 in consideration for signing the Agreement. Partners did not sign the Agreement. The parties stipulated that the amount owed Partners under both contracts is $44,032.00. Respondent contends that Petitioner’s claim is filed against the wrong business entity. Respondent argues that Petitioner’s contracts were with the DBA, and that Petitioner’s claim is incorrectly brought against the LLC. Thus, Respondent reasons, the LLC is not liable to Petitioner for the monies owed. The DBA was registered with the State of Florida in 2007 and held an active fruit dealer’s license through July 31, 2012. Marinaro owned and operated the DBA at 2101 15th Avenue, Vero Beach, Florida 32960. The DBA filed a citrus fruit dealer’s bond with the Department of Agriculture for the 2008-2009 shipping season. Marinaro registered the trademark “Sunny Fresh” logo in the name of the DBA in 2007, and was still using the logo on his business letterhead in 2013. Marinaro formed the LLC in 2011, which holds an active citrus fruit dealer’s license. Marinaro and his wife, Jean, are the only members of the LLC. The principal address is 2101 15th Avenue, Vero Beach, Florida 32960. The LLC filed citrus fruit dealer’s bonds with the Department of Agriculture on June 28, 2012, for the shipping season ending July 31, 2013, and on May 2, 2013, for the shipping season ending July 31, 2014. Marinaro did not refile a bond for the DBA after forming the LLC. At all times relevant hereto, Marinaro’s fruit dealer’s business has been physically located at 2101 15th Avenue, Vero Beach, Florida 32960. The building at that address bears the name “Sunny Fresh.” Marinaro testified that he formed the LLC shortly after his heart attack to “protect his personal assets.” Marinaro explained that he had little revenue in the LLC “for the next two years,” and he planned for the LLC to conduct sales for the packing company. He expected the LLC would be purchasing fruit from other packing houses. In fact, he testified that, during his absence, he was not aware that either the DBA or the LLC were purchasing fruit. Marinaro was clearly upset about the financial state of his business when he resumed control in the Spring of 2013. He testified that, prior to his heart attack, he was running a business with a typical $10 to $12 million yearly revenue, but that he returned to a business in debt to the tune of roughly $790,000.00. Marinaro lamented that Paladin entered into contracts to buy citrus when that was not the plan for the LLC. Alternately, he blamed Paladin for taking too much money out of the LLC to set up the packing house. Marinaro’s testimony was inconsistent and unreliable. He first testified that Paladin had full authority to purchase fruit in his absence, but later professed to be “dismayed” that his company was purchasing fruit in his absence. The evidence does not support a finding that the LLC was formed for any reason other than to continue his fruit dealings in a legal structure that would protect his personal assets. Marinaro’s explanation that the purpose of the LLC was to conduct sales for the packing company also lacks credibility. The LLC was organized in November 2011, but the packing house in Ft. Pierce from which he acquired the equipment to set up a packing house in Okeechobee did not go “belly up” until February 2012. Marinaro would have had to be clairvoyant to set up an LLC for the sole purpose of sales to a packing house about which he was not aware until four months later. Marinaro’s testimony that he was in the dark about the running of his business and that he was somehow duped by Paladin is likewise unreliable. Marinaro testified that, during his absence, he was “concerned that Paladin was entering into contracts where a bond was required, but not secured.”4/ He could not have been concerned about contracts to buy fruit without posting the required bond if he was not even aware that his company was purchasing fruit. Further, Marinaro neither questioned Paladin about entering into the citrus contracts, nor suggested Paladin use a different contract form for the LLC. The evidence establishes that Marinaro knew Paladin was purchasing fruit during Marinaro’s absence to continue the regular fruit-dealer’s business, and further, that Marinaro knew Paladin was entering into contracts on behalf of the LLC, the company formed just one day prior to Marinaro granting Paladin full power of attorney to run his business. Finally, Marinaro knowingly participated in the formation of Sunny Fresh Packing, LLC, in February 2012, four months after he became incapacitated. This required his involvement in a complicated business scheme in which his company collected on a debt owed by a packing house in Ft. Pierce, and acquired the equipment to run the new packing house, with two partners, Parris and Paladin, located in Okeechobee on property owned by a third party, Mr. Smith, who is not a member of Sunny Fresh Packing, LLC. It is unlikely Marinaro was clueless as to the fruit dealings of the LLC in his absence. Further, it is disingenuous, at best, for Marinaro to suggest that the contracts entered into in 2012 are not with the LLC, the corporation he formed in 2011 to protect his personal assets from his business obligations.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Agriculture and Consumer Services enter a final order approving the claim of DP Partners, Ltd., against Sunny Fresh Citrus Export and Sales Co., LLC, in the amount of $44,032.00. DONE AND ENTERED this 30th day of October, 2014, in Tallahassee, Leon County, Florida. S Suzanne Van Wyk Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 30th day of October, 2014.
The Issue The issue in DOAH Case No. 02-3648RE is whether Emergency Rules 20ER02-01, 20ER02-02, and 20ER02-03 constitute an invalid exercise of delegated legislative authority. The issue in DOAH Case No. 02-4607RP is whether Proposed Rules 20-15.001, 20- 15.002, and 20-15.003, Florida Administrative Code, constitute an invalid exercise of delegated legislative authority.
Findings Of Fact Based on the stipulated facts, and the entire record in this proceeding, the following findings of fact are made: The Florida Citrus Commission was established in 1935 to organize and promote the growing and sale of various citrus products, fresh and processed, in the State of Florida. The purpose of the Citrus Commission is today reflected in Section 601.02, Florida Statutes. The powers of the Florida Citrus Commission ("the Commission") and the Department, are set forth in full in Section 601.10, Florida Statutes. The powers of the Department include the power to tax and raise other revenue to achieve the purposes of the Department. In particular, Section 601.10(1) and (2), Florida Statutes, state: The Department of Citrus shall have and shall exercise such general and specific powers as are delegated to it by this chapter and other statutes of the state, which powers shall include, but shall not be confined to, the following: To adopt and, from time to time, alter, rescind, modify, or amend all proper and necessary rules, regulations, and orders for the exercise of its powers and the performance of its duties under this chapter and other statutes of the state, which rules and regulations shall have the force and effect of law when not inconsistent therewith. To act as the general supervisory authority over the administration and enforcement of this chapter and to exercise such other powers and perform such other duties as may be imposed upon it by other laws of the state. The Department is authorized to set standards by Section 601.11, Florida Statutes, as follows: The Department of Citrus shall have full and plenary power to, and may, establish state grades and minimum maturity and quality standards not inconsistent with existing laws for citrus fruits and food products thereof containing 20 percent or more citrus or citrus juice, whether canned or concentrated, or otherwise processed, including standards for frozen concentrate for manufacturing purposes, and for containers therefor, and shall prescribe rules or regulations governing the marking, branding, labeling, tagging, or stamping of citrus fruit, or products thereof whether canned or concentrated, or otherwise processed, and upon containers therefor for the purpose of showing the name and address of the person marketing such citrus fruit or products thereof whether canned or concentrated or otherwise processed; the grade, quality, variety, type, or size of citrus fruit, the grade, quality, variety, type, and amount of the products thereof whether canned or concentrated or otherwise processed, and the quality, type, size, dimensions, and shape of containers therefor, and to regulate or prohibit the use of containers which have been previously used for the sale, transportation, or shipment of citrus fruit or the products thereof whether canned or concentrated or otherwise processed, or any other commodity; provided, however, that the use of secondhand containers for sale and delivery of citrus fruit for retail consumption within the state shall not be prohibited; provided, however, that no standard, regulation, rule, or order under this section which is repugnant to any requirement made mandatory under federal law or regulations shall apply to citrus fruit, or the products thereof, whether canned or concentrated or otherwise processed, or to containers therefor, which are being shipped from this state in interstate commerce. All citrus fruit and the products thereof whether canned or concentrated or otherwise processed sold, or offered for sale, or offered for shipment within or without the state shall be graded and marked as required by this section and the regulations, rules, and orders adopted and made under authority of this section, which regulations, rules, and orders shall, when not inconsistent with state or federal law, have the force and effect of law. The Department is authorized to conduct citrus research by Section 601.13, Florida Statutes. To help pay for these duties of the Department, the Legislature first enacted the "box tax" in 1949. The box tax is now codified as Section 601.15(3), Florida Statutes. Section 601.15(3)(a), Florida Statutes, provides in relevant part: There is hereby levied and imposed upon each standard-packed box of citrus fruit grown and placed into the primary channel of trade in this state an excise tax at annual rates for each citrus season as determined from the tables in this paragraph and based upon the previous season's actual statewide production as reported in the United States Department of Agriculture Citrus Crop Production Forecast as of June 1. Section 601.15(3)(a), Florida Statutes, goes on to set forth specific rates for fresh grapefruit, processed grapefruit, fresh oranges, processed oranges, and fresh or processed tangerines and citrus hybrids. Section 601.15(1), Florida Statutes, sets forth the Department's authority to administer the box tax, as follows: The administration of this section shall be vested in the Department of Citrus, which shall prescribe suitable and reasonable rules and regulations for the enforcement hereof, and the Department of Citrus shall administer the taxes levied and imposed hereby. All funds collected under this section and the interest accrued on such funds are consideration for a social contract between the state and the citrus growers of the state whereby the state must hold such funds in trust and inviolate and use them only for the purposes prescribed in this chapter. The Department of Citrus shall have power to cause its duly authorized agent or representative to enter upon the premises of any handler of citrus fruits and to examine or cause to be examined any books, papers, records, or memoranda bearing on the amount of taxes payable and to secure other information directly or indirectly concerned in the enforcement hereof. Any person who is required to pay the taxes levied and imposed and who by any practice or evasion makes it difficult to enforce the provisions hereof by inspection, or any person who, after demand by the Department of Citrus or any agent or representative designated by it for that purpose, refuses to allow full inspection of the premises or any part thereof or any books, records, documents, or other instruments in any manner relating to the liability of the taxpayer for the tax imposed or hinders or in anywise delays or prevents such inspection, is guilty of a misdemeanor of the second degree, punishable as provided in s. 775.082 or s. 775.083. The box tax was challenged in 1936 and the Florida Supreme Court issued an opinion in 1937 upholding the validity of the box tax. C.V. Floyd Fruit Company v. Florida Citrus Commission, 128 Fla. 565, 175 So. 248 (1937). In 1970, the Legislature enacted the "equalization tax," codified as Section 601.155, Florida Statutes. The statute mirrored Section 601.15, Florida Statutes, but added certain processors who were mixing foreign citrus products with Florida products. The purpose of the equalization tax was to have all Florida processors of citrus products help pay for the costs of the Department, rather than have the burden fall entirely on the Florida growers subject to the box tax. Section 601.155, Florida Statutes, provides, in relevant part: The first person who exercises in this state the privilege of processing, reprocessing, blending, or mixing processed orange products or processed grapefruit products or the privilege of packaging or repackaging processed orange products or processed grapefruit products into retail or institutional size containers or, except as provided in subsection (9) or except if a tax is levied and collected on the exercise of one of the foregoing privileges, the first person having title to or possession of any processed orange product or any processed grapefruit product who exercises the privilege in this state of storing such product or removing any portion of such product from the original container in which it arrived in this state for purposes other than official inspection or direct consumption by the consumer and not for resale shall be assessed and shall pay an excise tax upon the exercise of such privilege at the rate described in subsection (2). Upon the exercise of any privilege described in subsection (1), the excise tax levied by this section shall be at the same rate per box of oranges or grapefruit utilized in the initial production of the processed citrus products so handled as that imposed, at the time of exercise of the taxable privilege, by s. 601.15 per box of oranges. In order to administer the tax, the Legislature provided the following relevant provisions in Section 601.155, Florida Statutes: Every person liable for the excise tax imposed by this section shall keep a complete and accurate record of the receipt, storage, handling, exercise of any taxable privilege under this section, and shipment of all products subject to the tax imposed by this section. Such record shall be preserved for a period of 1 year and shall be offered for inspection upon oral or written request by the Department of Citrus or its duly authorized agent. Every person liable for the excise tax imposed by this section shall, at such times and in such manner as the Department of Citrus may by rule require, file with the Department of Citrus a return, certified as true and correct, on forms to be prescribed and furnished by the Department of Citrus, stating, in addition to other information reasonably required by the Department of Citrus, the number of units of processed orange or grapefruit products subject to this section upon which any taxable privilege under this section was exercised during the period of time covered by the return. Full payment of excise taxes due for the period reported shall accompany each return. All taxes levied and imposed by this section shall be due and payable within 61 days after the first of the taxable privileges is exercised in this state. Periodic payment of the excise taxes imposed by this section by the person first exercising the taxable privileges and liable for such payment shall be permitted only in accordance with Department of Citrus rules, and the payment thereof shall be guaranteed by the posting of an appropriate certificate of deposit, approved surety bond, or cash deposit in an amount and manner as prescribed by the Department of Citrus. * * * (11) This section shall be liberally construed to effectuate the purposes set forth and as additional and supplemental powers vested in the Department of Citrus under the police power of this state. In March 2000, certain citrus businesses challenged Section 601.155(5), Florida Statutes, as being unconstitutional. At the time of the suit, Section 601.155(5), Florida Statutes, read as follows: All products subject to the taxable privileges under this section, which products are produced in whole or in part from citrus fruit grown within the United States, are exempt from the tax imposed by this section to the extent that the products are derived from oranges or grapefruit grown within the United States. In the case of products made in part from citrus fruit grown within the United States, it shall be the burden of the persons liable for the excise tax to show the Department of Citrus, through competent evidence, proof of that part which is not subject to a taxable privilege. The citrus businesses claimed the exemption in Section 601.155(5) rendered the tax unconstitutionally discriminatory, in that processors who imported juice from foreign countries to be blended with Florida juice were subject to the equalization tax, whereas processors who imported juice from places such as California, Arizona and Texas enjoyed an exemption from the tax. The case, Tampa Juice Service, Inc., et al. v. Department of Citrus, Case No. GCG-00-3718 (Consolidated), was brought in the Tenth Judicial Circuit Court, in and for Polk County. Judge Dennis P. Maloney of that court continues to preside over that case. In a partial final declaratory judgment effective March 15, 2002, Judge Maloney found Section 601.155, Florida Statutes, unconstitutional because it violated the Commerce Clause of the United States Constitution due to its discriminatory effect in favor of non-Florida United States juice. In an order dated April 15, 2002, Judge Maloney severed the exemption in Section 601.155(5), Florida Statutes, from the remainder of the statute. The court's decision necessitated the formulation of a remedy for the injured plaintiffs. While the parties were briefing the issue before the court, the Florida Legislature met and passed Chapter 2002-26, Laws of Florida, which amended Section 601.155, Florida Statutes, to read as follows: Products made in whole or in part from citrus fruit on which an equivalent tax is levied pursuant to s. 601.15 are exempt from the tax imposed by this section. In the case of products made in part from citrus fruit exempt from the tax imposed by this section, it shall be the burden of the persons liable for the excise tax to show the Department of Citrus, through competent evidence, proof of that part which is not subject to a taxable privilege. Chapter 2002-26, Laws of Florida, was given an effective date of July 1, 2002. By order dated August 8, 2002, Judge Maloney set forth his decision as to the remedy for the plaintiffs injured by the discriminatory effect of Section 601.155(5), Florida Statutes. Judge Maloney expressly relied on the rationale set forth in Division of Alcoholic Beverages and Tobacco v. McKesson Corporation, 574 So. 2d 114 (Fla. 1991)("McKesson II"). In its initial McKesson decision, Division of Alcoholic Beverages and Tobacco v. McKesson Corporation, 524 So. 2d 1000 (Fla. 1988), the Florida Supreme Court affirmed a summary judgment ruling that Florida's alcoholic beverage tax scheme, which gave tax preferences and exemptions to certain alcoholic beverages made from Florida crops, unconstitutionally discriminated against interstate commerce. The Florida Supreme Court also affirmed that portion of the summary judgment giving the ruling prospective effect, thus denying the plaintiff a refund of taxes paid pursuant to the unconstitutional scheme. The decision was appealed to the United States Supreme Court. In McKesson Corporation v. Division of Alcoholic Beverages and Tobacco, 496 U.S. 18 (1990), the United States Supreme Court reversed the Florida Supreme Court's decision as to the prospective effect of its decision. The United States Supreme Court held that: The question before us is whether prospective relief, by itself, exhausts the requirements of federal law. The answer is no: If a State places a taxpayer under duress promptly to pay a tax when due and relegates him to a postpayment refund action in which he can challenge the tax's legality, the Due Process Clause of the Fourteenth Amendment obligates the State to provide meaningful backward-looking relief to rectify any unconstitutional deprivation. 496 U.S. at 31 (footnotes omitted). The United States Supreme Court set forth the following options by which the state could meet its obligation to provide "meaningful backward-looking relief:" [T]he State may cure the invalidity of the Liquor Tax by refunding to petitioner the difference between the tax it paid and the tax it would have been assessed were it extended the same rate reductions that its competitors actually received. . . . Alternatively, to the extent consistent with other constitutional restrictions, the State may assess and collect back taxes from petitioner's competitors who benefited from the rate reductions during the contested tax period, calibrating the retroactive assessment to create in hindsight a nondiscriminatory scheme. . . . Finally, a combination of a partial refund to petitioner and a partial retroactive assessment of tax increases on favored competitors, so long as the resultant tax actually assessed during the contested tax period reflects a scheme that does not discriminate against interstate commerce, would render petitioner's resultant deprivation lawful and therefore satisfy the Due Process Clause's requirement of a fully adequate postdeprivation procedure. 496 U.S. at 40-41 (citations and footnotes omitted). The United States Supreme Court expressly provided that the state has the option of choosing the form of relief it will grant. In keeping with the United States Supreme Court opinion, the Florida Supreme Court granted the Division of Alcoholic Beverages and Tobacco (the "Division") leave to advise the Court as to the form of relief the state wished to provide. The Division proposed to retroactively assess and collect taxes from those of McKesson's competitors who had benefited from the discriminatory tax scheme. McKesson contended that a refund of the taxes it had paid was the only clear and certain remedy, because retroactive taxation of its competitors would violate their due process rights. McKesson II, 574 So. 2d at 115. The Florida Supreme Court remanded the case to the trial court for further proceedings on McKesson's refund claim, with the following instructions: While McKesson may not necessarily be entitled to a refund, it is entitled to a "clear and certain remedy," as outlined in the Supreme Court's opinion. Because nonparties, such as amici, will be directly affected by the retroactive tax scheme proposed by the state, all affected by the proposed emergency rule must be given notice and an opportunity to intervene in this action. Therefore, on remand, the trial court not only must determine whether the state's proposal meets "the minimum federal requirements" outlined in the Supreme Court's opinion, it also must determine whether the proposal comports with federal and state protections afforded those against whom the proposed tax will be assessed. We emphasize that the state has the option of choosing the manner in which it will reformulate the alcoholic beverage tax during the contested period so that the resultant tax actually assessed during that period reflects a scheme which does not discriminate against interstate commerce. Therefore, if the trial court should rule that the state's proposal to retroactively assess and collect taxes from McKesson's competitors does not meet constitutional muster and such ruling is upheld on appeal, the state may offer an alternative remedy for the trial court's review. However, any such proposal likewise must satisfy the standards set forth by the Supreme Court as well as be consistent with other constitutional restrictions. 574 So. 2d at 116. In the instant case, Judge Maloney assessed the options prescribed by the series of McKesson cases and concluded that the only fair remedy was to assess and collect back assessments from those who benefited from the unconstitutional equalization tax exemption. His August 8, 2002 order directed the Department to "take appropriate steps, consistent with existing law, to assess and collect the Equalization tax from those entities which [benefited] from the unconstitutional exemption." On September 18, 2002, the Department promulgated the Emergency Rules at issue in DOAH Case No. 02-3648RE. The Emergency Rules were filed with the Department of State on September 24, 2002, and took effect on that date. They were published in the October 4, 2002 issue of the Florida Administrative Weekly (vol. 28, no. 40, pp. 4271-4272). The full text of the Emergency Rules is: EQUALIZATION TAX ON NON-FLORIDA UNITED STATES JUICE 20ER02-1 Intent. The Court in Tampa Juice Service, et al v. Florida Department of Citrus in Consolidated Case Number GCG-003718 (Circuit Court in and for Polk County, Florida) severed the exemption contained in Section 601.155(5), Florida Statutes, that provided an exemption for persons who exercised one of the enumerated Equalization Tax privileges on non-Florida, United States juice. The Court had previously determined that the stricken provisions operated in a manner that violated the Commerce Clause of the United States Constitution. On August 8, 2002, the Court ordered that the Florida Department of Citrus "take appropriate steps, consistent with existing law, to assess and collect the Equalization tax from those entities which [benefited] from the unconstitutional exemption." It is the Florida Department of Citrus' intent by promulgating the following remedial Rule 20ER02-01 and Chapter 20-15, F.A.C., to implement a non-discriminatory tax scheme, which does not impose a significant tax burden that is so harsh and oppressive as to transgress constitutional limitations. These rules shall be applicable to those previously favored persons who received favorable tax treatment under the statutory sections cited above. Specific Authority 601.02, 601.10, 601.15, 601.155 FS. Law Implemented 601.02, 601.10, 601.15, 601.155 FS. History-- New 9-24-02. 20ER02-2 Definitions. "Previously favored persons" shall be defined as any person who exercised an enumerated Equalization Tax privilege as defined by Section 601.155, Florida Statutes, but who was exempt from payment of the Equalization Tax due to the exemption for non-Florida, United States juice set forth in the statutory provision, which was ultimately determined to be unconstitutional and severed from Section 601.155(5), Florida Statutes. The "tax period" during which the severed provisions of Section 601.155(5), Florida Statutes, were in effect shall be defined as commencing on October 6, 1997, and ending on March 14, 2002. "Tax liability" shall be defined as the total amount of taxes due to the Florida Department of Citrus during the "tax period," at the following rates per box for each respective fiscal year: Fiscal Year Processed Rate Orange Grapefruit 1997-1998 .175 .30 1998-1999 .17 .30 1999-2000 .18 .325 2000-2001 .175 .30 2001-2002 .165 .18 Specific Authority 601.02, 601.10, 601.15, 601.155 FS. Law Implemented 601.02, 601.10, 601.15, 601.155 FS. History-- New 9-24-02. 20ER02-3 Collection. The Florida Department of Citrus shall calculate the tax liability for each person or entity that exercised an enumerated Equalization Tax privilege outlined in section 601.155, Florida Statutes, upon non-Florida, United States juice based upon inspection records maintained by Florida Department of Agriculture and Consumer Services and the United States Department of Agriculture. Additionally, the Florida Department of Citrus will provide notice of the calculation to the previously favored persons by certified mail. The notice of the calculation shall contain a statement including the following categories: (a) Tax liability; (b) Gallons; Brix; Type of product; (e) Total solids; (f) Conversion rate; (g) Total boxes; (h) Delineation of non-Florida, United States juice. (2)(a) Contained within the notice will be the various legal options available to those who previously enjoyed the exemption, set forth in proposed Rule 20- 15.003(2), F.A.C. (b) Persons who previously enjoyed the exemption may petition to intervene in the case of Tampa Juice Service, Inc., et al, Consolidated Case No. GCG-003718, presently pending before the Circuit Court of the Tenth Judicial Circuit in and for Polk County. A hearing to consider arguments made by any intervenor, the Plaintiffs and the Florida Department of Citrus is currently scheduled to be heard by the Honorable Dennis Maloney on November 12, 2002, in Bartow, Florida. (3) The Florida Department of Citrus will not oppose the timely intervention of persons who previously enjoyed the subject exemption that wish to present a claim to the Court in the Tampa Juice Service, Inc., et al v. Florida Department of Citrus. However, the Florida Department of Citrus does not waive any argument regarding the validity of the calculation of the tax liability or that imposition of this tax is constitutional. Specific Authority 601.02, 601.10, 601.15, 601.155 FS. Law Implemented 601.02, 601.10, 601.15, 601.155 FS. History-- New 9-24-02. The Department's "Specific Reasons for Finding an Immediate Danger to the Public Health, Safety or Welfare" were set forth as follows: On March 18, 2002, the Court in the Tenth Judicial Circuit, State of Florida, in and for Polk County, entered a Partial Final Declaratory Judgment in the case of Tampa Juice Service, Inc., et al v. Florida Department of Citrus, Consolidated Case Number GCG-003718. In this order the Court ruled that the exemption in Section 601.155, F.S., for non-Florida, United States juice was unconstitutional. On or about April 15, 2002, the Court severed the exemption for non-Florida, United States juice from section 601.155(5), F.S. On August 8, 2002, the Court held that the Florida Department of Citrus was required to cure the invalidity of the equalization taxing scheme. To cure this invalidity, the Florida Department of Citrus promulgates Rule 20ER02-1, F.A.C., which will serve to implement the Court's order for a nondiscriminatory tax scheme and provide due process protections for the previously favored taxpayers. These rules are being promulgated on an emergency basis to meet time constraints associated with litigation and to establish guidelines which protect the public's and state's interest for the orderly and efficient collection and payment of the tax liability. Without these guidelines, the welfare of the citizens and the state would be adversely affected because of the immediate and widespread impact of the failure of previously favored persons to properly remit the tax. The Department's "Reason for Concluding that the Procedure is Fair Under the Circumstances" was set forth as follows: Promulgation of these guidelines using the emergency rule procedures is the only available mechanism which adequately protects the public interests under the circumstances which require collection and payment of the tax liability. This procedure is fair to the public and to the previously favored persons. It permits promulgation of the necessary guidelines within a time frame which allows the industry to be adequately informed of their duties, responsibilities and rights with respect to the tax liability. In the November 15, 2002 issue of the Florida Administrative Weekly (vol. 28, no. 46, pp. 4996-4998), the Department published the Proposed Rules at issue in DOAH Case No. 02-4607RP. The text of Proposed Rule 20-15.001, Florida Administrative Code, is identical to that of Emergency Rule 20ER02-1, set forth above. The text of Proposed Rule 20-15.002, Florida Administrative Code, is identical to that of Emergency Rule 20ER02-2, set forth above. The text of Proposed Rule 20- 15.003(1)&(3), Florida Administrative Code, is identical to that of Emergency Rule 20ER02-3(1)&(3), set forth above. The text of Proposed Rule 15.003(2), Florida Administrative Code, varies from the text of Emergency Rule 20ER02-3(2), and reads as follows: 20-15.003 Collection. Subsequent to adoption of this rule, the Florida Department of Citrus will provide to the previously favored persons by certified mail a Notice of Tax Liability which shall contain a demand for payment consistent with the above-referenced itemized statement. The Department will deem late payment of Equalization Taxes owed by previously favored persons to constitute good cause, and shall waive the 5 percent penalty authorized by Section 601.155(10), F.S., as compliance with either of the following is established by Department [sic]: Lump sum payment of the tax liability remitted with the filing of Department of Citrus Form 4R (incorporated by reference in Rule 20-100.004, F.A.C.) for the relevant years and then-applicable tax rate(s) per subsection 20-15.002(3), F.A.C., within 61 days of receiving Notice of Tax Liability; or Equal installment payments remitted with the filing of Department of Citrus Form 4R (incorporated by reference in Rule 20-100.004, F.A.C.) for the relevant years and then-applicable tax rate(s) per subsection subsection [sic] 20-15.002(3), F.A.C., over a 60-month period, the first payment being due within 61 days of receiving Notice of Tax Liability pursuant to subsection 20-15.003(2), F.A.C.; or The Good Cause provisions of 601.155(10), F.S., shall not apply to persons who do not comply with paragraph 20- 15.003(2)(a), F.A.C., or paragraph 20- 15.003(2)(b), F.A.C. Failure to pay the taxes or penalties due under 601.155, F.S. and Chapter 20-15, F.A.C., shall constitute grounds for revocation or suspension of a previously favored person's citrus fruit dealer's license pursuant to 601.56(4), F.S., 601.64(6), F.S., 601.64(7), F.S., and/or 601.67(1), F.S. Peace River is a Florida corporation and licensed citrus fruit dealer regulated by Chapter 601, Florida Statutes. As such, Peace River is subject to the rules of the Department. Peace River buys, sells, and manufactures bulk citrus juices. By correspondence dated October 2, 2002, Peace River was notified by the Department that Peace River would be liable for payment of $86,242.41 in Equalization taxes for the tax period of October 6, 1997 through March 14, 2002 (the "tax period"), pursuant to the terms of the Emergency Rules. Fresh Juice is a Florida corporation and licensed citrus fruit dealer regulated by Chapter 601, Florida Statutes. As such, Fresh Juice is subject to the rules of the Department. Fresh Juice buys, sells, and manufactures citrus juices. By correspondence dated October 2, 2002, Fresh Juice was notified by the Department that Fresh Juice would be liable for payment of $45,052.19 in Equalization taxes for the tax period, pursuant to the terms of the Emergency Rules. Sun Orchard is a Florida corporation and licensed citrus fruit dealer regulated by Chapter 601, Florida Statutes. As such, Sun Orchard is subject to the rules of the Department. Sun Orchard buys, sells, and manufactures citrus juices. By correspondence dated October 2, 2002, Sun Orchard was notified by the Department that Sun Orchard would be liable for payment of $45,052.19 in Equalization taxes for the tax period, pursuant to the terms of the Emergency Rules. During the tax period, Peace River, Fresh Juice, and Sun Orchard imported, stored and blended non-Florida, United States citrus juices. Neither Peace River, Fresh Juice, nor Sun Orchard is a party to the lawsuit styled Tampa Juice Service, Inc., et al. v. Department of Citrus, Case No. GCG-00-3718 (Consolidated). Peace River, Fresh Juice, and Sun Orchard contend that they relied on the tax exemption in making business decisions and had no notice that their activities regarding non-Florida, United States juice would be taxable upon the court's striking of the exemption in Section 601.155(5), Florida Statutes. Accordingly, Peace River, Fresh Juice, and Sun Orchard contend that, during the tax period, they had no opportunity to conform their conduct to avoid the tax or position themselves to claim a refund allowed by Section 601.155, Florida Statutes. Peace River, Fresh Juice, and Sun Orchard contend that they have not been obligated by Chapter 601, Florida Statutes, to keep specific records on their use of non-Florida United States citrus juices for the tax period, but admit they keep business records required by law, which may include some business records related to non-Florida United States juice during the tax period. Peace River, Fresh Juice, and Sun Orchard shipped products made with non-Florida, United States juice during the tax period without payment of the Equalization Tax.
The Issue The issues in this case are whether Respondent, a licensed citrus fruit dealer, violated the Florida Citrus Code by failing to pay Petitioner the full purchase price for grapefruit that the dealer had harvested from Petitioner's grove and sold in the ordinary course of business to its (the dealer's) customers; and, if so, the amount of the indebtedness owed by the dealer.
Findings Of Fact Petitioner Frontier Fresh of Indian River, LLC ("Seller"), is in the business of growing citrus fruit and hence is a "producer" as that term is defined in the Florida Citrus Code. § 601.03(33), Fla. Stat. Respondent United Indian River Packers, LLC ("Buyer"), is a "citrus fruit dealer" operating within the regulatory jurisdiction of the Department of Agriculture and Consumer Services (the "Department"). See § 601.03(8), Fla. Stat. On September 6, 2013, Seller and Buyer entered into a Production Contract Agreement (the "Contract") under which Buyer agreed to purchase and harvest red and flame grapefruit (both generally called "colored grapefruit") then growing in Seller's "Emerald Grove" in St. Lucie County. Buyer promised to pay Seller $7.75 per box plus "rise" for all colored grapefruit harvested from the Emerald Grove during the 2013/2014 season. ("Rise" is an additional payment due Seller if Buyer's net revenue from marketing the fruit exceeds the Contract price or "floor payment.") The Contract gave Buyer and its "agents, employees and vehicles" the right to "enter upon SELLER'S premises . . . from time to time for the purpose of inspecting, testing and picking fruit, and for the purpose of removing said fruit." Buyer was obligated to make scheduled payments to Seller totaling $250,000 between September and December 2013, with the balance of the floor payment "to be made within 45 days from week of harvest." The deadline for making the final rise payment was June 30, 2014. The Contract described the Seller's duties as follows: SELLER agrees to maintain the crop merchantable and free from Citrus Canker, Mediterranean fruit fly, Caribbean fruit fly, and any and all impairments which would alter the ability to market the crop. It is further agreed that in the event of such happening BUYER has the option to renegotiate with SELLER within 10 days of such find, or terminate contract and receive any monies that may be remaining from deposit. It is understood and agreed that the word "merchantable" as herein used, shall mean fruit that has not become damaged by cold, hail, fire, windstorm, insects, drought, disease or any other hazards to the extent it cannot meet all applicable requirements of the laws of the State of Florida and the Federal Government, including without limitation those relating to pesticides, and the regulations of the Florida Department of Citrus relating to grade and quality. With regard to default, the Contract provided: It is further agreed that in case of default by either the BUYER or SELLER the opposite party may, at his option, take legal action to enforce this contract or may enter into negotiations to carry out the terms and provisions thereof, in which event the party found to be in default shall pay reasonable costs in connection with either negotiation or litigation, such cost to include a reasonable attorney's fee to party prevailing in such controversy. The Contract acknowledged the existence of a "Citrus Fruit Dealers Bond" posted with the Department but cautioned that the bond "is not insurance against total 1iabilities that may be incurred if a citrus fruit dealer should default" and "does not necessarily insure full payment of claims for any nonperformance under this contract." Buyer began picking colored grapefruit from the Emerald Grove on October 17, 2013, and initially things went well. For the first month, Buyer achieved encouraging packout percentages of between 60% and 90%. (The packout percentage expresses the ratio of fruit deemed acceptable for the fresh market to the total fruit in the run. A higher packout percentage means fewer "eliminations" for the juice processing plant and thus a more valuable run.) On November 13, 2013, however, the packout rate plunged to around 38%. Although there were some good runs after that date, for the rest of the season the packout percentages of grapefruit picked from the Emerald Grove mostly remained mired in the 30% to 50% range, which is considered undesirably low. Everyone agrees that the 2013/2014 grapefruit crop in the Emerald Grove was disappointing. Representatives of Buyer and Seller met at the Emerald Grove in mid-November to discuss the reduced packout percentages. Mild disagreement about the exact reason or reasons for the drop-off in quality arose, but some combination of damage by rust mites and a citrus disease known as greasy spot is the likeliest culprit.1/ The problems were not unique to Emerald Grove, as the 2013/2014 citrus season was generally poor in the state of Florida. Seller's grapefruit crop was consistent with the statewide crop for that year. Despite the low packout percentages, and being fully aware of the crop's condition, Buyer continued to harvest colored grapefruit from the Emerald Grove, which it packed and exported for sale to its customers in Europe, Japan, and Southeast Asia. After picking fruit on February 3, 2014, however, Buyer repudiated the Contract and left the colored grapefruit remaining in the Emerald Grove to Seller. As a result, Seller sold the rest of the crop to another purchaser.2/ At no time did Buyer notify Seller that it was rejecting any of the grapefruit which Buyer had picked and removed from the Emerald Grove pursuant to the Contract. For months after Buyer stopped performing under the Contract, Seller endeavored to collect the amounts due for all the fruit that Buyer had harvested. By mid-April, however, Buyer still owed several hundred thousand dollars. At a meeting between the parties on April 22, 2014, Buyer proposed that Seller discount the purchase price given the disappointing nature of the crop, which Buyer claimed had caused it to lose some $200,000 in all. Buyer requested that Seller forgive around $100,000 of the debt owed to Buyer, so that Seller, in effect, would absorb half of Seller's losses. Buyer expected that Seller would agree to the proposed reduction in price and maintains that the parties did, in fact, come to a meeting of the minds in this regard, but the greater weight of the evidence shows otherwise. Seller politely but firmly——and unequivocally——rejected Buyer's proposal, although Seller agreed to accept installment payments under a schedule that would extinguish the full debt by August 31, 2014. This response disappointed Buyer, but Buyer continued to make payments to Seller on the agreed upon payment schedule. By email dated June 4, 2014, Buyer's accountant asked Seller if Seller agreed that the final balance due to Seller was $108,670.50. Seller agreed that this was the amount owing. After that, Buyer tried again to persuade Seller to lower the price, but Seller refused. Buyer made no further payments. At no time did Buyer notify Seller that it was revoking its acceptance of any of the fruit harvested from the Emerald Grove during the 2013/2014 season. Having taken physical possession of the fruit, Buyer never attempted to return the goods or demanded that Seller retrieve the fruit. Rather, exercising ownership of the goods, Buyer sold all the colored grapefruit obtained under the Contract to its customers for its own account. On October 14, 2014, Seller brought suit against Buyer in the Circuit Court of the Nineteenth Judicial Circuit, in and for Indian River County, Florida, initiating Case Number 31-2014-CA-001046. Buyer filed a counterclaim against Seller for breach of contract. On February 4, 2015, Seller filed a Notice of Voluntary Dismissal of its judicial complaint, opting to take advantage of available administrative remedies instead, which it is pursuing in this proceeding. As of the final hearing, Buyer's counterclaim remained pending in the circuit court.
Recommendation Based on the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that the Department of Agriculture and Consumer Services enter a final order awarding Frontier Fresh of Indian River, LLC, the sum of $108,670.50, together with pre-award interest at the statutory rate from June 4, 2014, to the date of the final order, and establishing a reasonable time within which said indebtedness shall be paid by United Indian River Packers, LLC. DONE AND ENTERED this 27th day of August, 2015, in Tallahassee, Leon County, Florida. S JOHN G. VAN LANINGHAM Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 27th day of August, 2015.
The Issue The issues in this case are whether, and to what extent, the Respondent, a licensed citrus fruit dealer, is liable to the Petitioner for damages resulting from the purchase, handling, sale, and accounting of purchases and sales occurring during the 1992-1993 growing season, and further whether the Co- Respondent, Surety Company, is therefore liable on the citrus fruit dealer's bond issued to the Respondent.
Findings Of Fact Petitioner, Newbern Groves Inc., is a Florida corporation engaged in the business of producing, buying, and selling citrus fruit. Petitioner's business address is in Tampa, Florida. Newbern Groves, Inc. was founded in 1947 by Copeland Newbern, who at all relevant times in this case served as Chairman of the Board of Directors. The President of Newbern Groves, Inc., is John Shepard. The Secretary- Treasurer of Newbern Groves, Inc., is Peter Skemp. At all relevant times, Respondent, Inter-Floridana, Inc., (full name, Inter-Floridana Imports and Exports, Inc.) was a citrus fruit dealer, licensed by the State of Florida during the 1992-1993 growing season. Respondent's business address was Brooksville, Florida, where Respondent operated a processing plant. The 1992-1993 growing season was the first year Respondent operated this processing plant. Respondent also maintained offices and warehouses in Orange County, Florida. In addition to its citrus fruit business, Respondent corporation also engaged in other business enterprises including blending other fruit drinks, processing tomato juice concentrate, and the sale of imported beer. At all relevant times, Jacques Bobbe was President and Chief Executive Officer of Inter-Floridana, Inc. At all relevant times, Larry Cail was the manager of the Respondent's processing plant in Brooksville, Florida. Beginning in May of 1992, Jacques Bobbe, on behalf of Inter-Floridana, and Peter Skemp and Copeland Newbern, on behalf of Newbern Groves, entered into discussions relating to Newbern's supplying Inter-Floridana with citrus fruit for the Inter-Floridana plant in Brooksville, Florida. Prior to this time the parties had not met, and there was no established course of business dealings between the parties. Specific meetings between the parties took place on July 30, 1992 in Brooksville; September 2, 1992 in Tampa; September 17, 1992 in Tampa; September 29, 1992 in Orlando; and November 25, 1992 in Tampa. The discussions conducted by the parties generally related to Newbern supplying Inter-Floridana with 1,500,000 boxes of citrus fruit which would accommodate the capacity of Inter-Floridana's Brooksville plant. The parties also generally discussed prices of various citrus fruit. There is no written documentation of the parties' negotiations. It is common practice in the citrus fruit industry to purchase and sell citrus fruit without written contracts. On November 3, 1992, Newbern delivered its first shipment of citrus fruit to Inter-Floridana's Brooksville plant. The shipment was delivered pursuant to Inter-Floridana's request to conduct a test-run of the processing plant's production capability. In December of 1992, Larry Cail of Inter- Floridana specifically requested grapefruit be delivered from Newbern. At that time Newbern was selling grapefruit to Chapman Fruit Company at $1.15 a pound. Thereafter Newbern continued to deliver citrus fruit shipments to Inter- Floridana's Brooksville plant on a regular basis until April 14, 1993. Inter- Floridana accepted the deliveries of citrus fruit from Newbern. The total pounds solids of Newbern fruit delivered to Inter-Floridana was 1,375,359.98, consisting of: 1,261,323.38 pound solids of orange juice 8,087.87 pound solids of mandarin 63,426.55 pound solids of white grapefruit juice 42,522.18 pound solids of red grapefruit juice. Beginning in December of 1992 Newbern representatives Peter Skemp and Copeland Newbern demanded payment for the fruit delivered to the Inter-Floridana plant in Brooksville. The customary practice in the citrus fruit business is payment is due one week after delivery. In this case, however, Newbern had agreed to a two-week after delivery payment. The price of the citrus fruit was to be calculated on the cost to Newbern of obtaining the fruit from the growers plus .05 for Newbern's expenses in making the deliveries to Inter-Floridana. On February 26, 1993, Inter-Floridana made its first payment to Newbern in the amount of $80,000. Thereafter Inter-Floridana made three more payments of $40,000, $40,000, and $30,000. The final payment from Inter-Floridana was made on April 1, 1993. After the April 1, 1993 payment, representatives of Newbern continued to demand payment from Inter-Floridana. No further payments were received, and Newbern ceased delivery of citrus fruit to Inter-Floridana on April 14, 1993. On May 12, 1993 the parties met in Brooksville, Florida. At this meeting Jacques Bobbe informed Peter Skemp and Copeland Newbern that Inter- Floridana's position was that Inter-Floridana was not purchasing citrus fruit from Newbern, but processing the citrus fruit for Newbern, and accordingly, Newbern owed Inter-Floridana approximately $400,000 for the costs of production, which was documented in a letter from Inter-Floridana to Newbern on May 14, 1993. At hearing on May 10, 1994, Jacques Bobbe testified that Inter-Floridana retracted its previous position, and did purchase citrus fruit from Newbern during the 1992-1993 growing season. On May 24, 1993, Copeland Newbern sent a letter to Jacques Bobbe demanding payment of $789,374.01 based on the Florida Citrus Mutual citrus statistics for the citrus fruit at that time, plus .05 for Newbern's services. On June 1, 1993, Jacques Bobbe sent a letter to Copeland Newbern requesting additional information regarding the calculation of the payment demanded from Newbern. On June 23, 1993, Copeland Newbern sent a certified letter to Jacques Bobbe detailing the problems associated with this transaction, and requesting assistance in resolving the matter in a timely manner. On June 25, 1993, Newbern filed the formal complaint against Inter- Floridana with the Department of Agriculture and Consumer Services which is the basis for this proceeding. Representatives of the parties met again on July 8, 1993; and on July 9, 1993, Jacques Bobbe sent a letter to John Shepard offering to resolve this matter as follows: Inter-Floridana would sell the frozen concentrated orange juice at $1.29 per pound solid; Newbern would receive $.83 per pound solid; Inter-Floridana would receive $.29 for packing and $.17 profit per pound solid. If the product sold for more than $1.29 per pound solid, the parties would divide the excess profit equally. On July 16, 1993, John Shepard, as President of Newbern Groves Inc., wrote to Jacques Bobbe and accepted this agreement. On July 19, 1993, Inter-Floridana filed its answer to the formal complaint filed by Newbern. The answer was verified by Jacques Bobbe. The answer denied that Inter-Floridana purchased citrus fruit from Newbern, and further claimed Newbern owed Inter-Floridana $442,133.21 for various services in connection with the processing and storage of the Newbern fruit. As set forth above, this position was subsequently retracted, and Inter-Floridana acknowledged the purchase of citrus fruit from Newbern. On August 5, 1993, Jacques Bobbe, on behalf of Inter-Floridana, filed a verified statement with the Department of Citrus attesting that Inter-Floridana did not purchase any fruit during the 1992-1993 growing season. The verified statement further attested that Inter-Floridana processed fruit for Newbern, and that Inter-Floridana had accounts payable of $978,580, and accounts receivable of $489,378.83. The accounts payable represented funds owed by Inter-Floridana to Newbern, and the accounts receivable consisted of the various production charges from Newbern as claimed by Inter-Floridana. On August 26, 1993, Newbern received an accounting from Inter-Floridana showing 500,651.26 pound solids of orange juice, 2,512.02 pound solids of mandarin, 39,809 pound solids of white grapefruit, and 11,602.50 pound solids of red grapefruit. This balance was substantially less than the amount delivered to Inter-Floridana. Unbeknown to Newbern, in February of 1993, Inter-Floridana had sold a substantial portion of the Newbern product to Windsor-Premium (Premium), a European business concern that Jacques Bobbe had been negotiating with since February of 1992. On February 26, 1993 Premium paid Inter-Floridana $807,825.29 for the product. This sale was the first part of a proposed ongoing transaction between Premium and Inter-Floridana to market citrus products in Europe. The proposed transaction would have been approximately $2 million; however, Premium did not complete the transaction with Inter-Floridana, and Premium eventually filed for bankruptcy in the United States District Court for the Southern District of Florida. The four payments totalling $190,000 that Inter-Floridana made to Newbern were derived from the proceeds of the sale to Premium. On October 1, 1993 Inter-Floridana sent a letter to John Shepard informing Newbern that of 1,375,359.57 pound solids, 848,558.76 had been sold. Thereafter in October of 1993, Inter-Floridana returned to Newbern 501,130.73 pound solids of orange, 18,018.92 pound solids of white grapefruit, and 11,614.39 pound solids of pink grapefruit. Newbern resold the returned orange citrus product to Indian River Fruits by means of a citrus broker, Merrill Lynch, which received a brokerage fee of $5,011.30. Some of the grapefruit citrus product had gelled and could not be resold.
Recommendation Based on the foregoing, it is, hereby, RECOMMENDED: That the Department of Agriculture and Consumer Services enter a final order adjudicating that the amount of indebtedness owed to the Petitioner from Respondent is $543,126.53, that the Respondent shall have thirty (30) days in which to satisfy such indebtedness, and upon failure of the Respondent to satisfy such indebtedness, the citrus fruit dealer's bond in the amount of $24,000 shall be distributed to Petitioner. DONE AND RECOMMENDED this 13th day of February, 1995, in Tallahassee, Leon County, Florida. RICHARD HIXSON Hearing Officer Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-1550 (904) 488-9675 Filed with the Clerk of the Division of Administrative Hearings this 13th day of February, 1995. APPENDIX TO RECOMMENDED ORDER, CASE NO. 94-6775 Petitioner's proposed findings of fact. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted. Accepted in part. Respondent acknowledged discussion of prices for the citrus fruit. Accepted in part. Respondent acknowledged an indebtedness of $978,580. Accepted. Accepted. Rejected as not supported by the evidence. Respondent's proposed findings of fact. Accepted. Accepted. Accepted. Rejected as not supported by the evidence. Rejected as not supported by the evidence. Rejected as not supported by the evidence. Accepted. Rejected in part. Rejected as to the frozen concentrated orange juice, accepted as to grapefruit. Rejected as irrelevant. Rejected as not supported by the evidence. Rejected as not supported by the evidence. Rejected as not supported by the evidence. Rejected as not supported by the evidence. COPIES FURNISHED: Timothy G. Hayes, Esquire 21859 State Road 54, Suite 200 Lutz, Florida 33549 Eric S. Mashburn, Esquire Post Office Box 771277 Winter Garden, Florida 34777-1277 The Honorable Bob Crawford Department of Agriculture and Consumer Services The Capitol, PL-10 Tallahassee, Florida 32399-0810 Richard Tritschler, General Counsel Department of Agriculture and Consumer Services The Capitol, PL-10 Tallahassee, Florida 32399-0810 Brenda Hyatt, Chief Bureau of Licensing & Bond Department of Agriculture 508 Mayo Building Tallahassee, Florida 32399-0800
