The Herald, Sharon, Pa.

Business

September 5, 2012

Produce companies sue FNB and PNC

By Joe Pinchot Herald Staff Writer

HERMITAGE — Two Pittsburgh wholesale produce dealers have sued First National Bank of Pennsylvania and PNC Bank alleging they illegally took over money owed by another produce company that filed bankruptcy.

First National, based in Hermitage has denied any wrongdoing and sued the bankrupt company and a firm that bought the bankrupt company’s inventory.

J.E. Corcoran Co. and Premier Produce Co. Inc., both of Pittsburgh, said in the suit filed July 9 that they sold produce to Steubenville Fruit Co. Inc. in November and December but Steubenville never paid and filed for bankruptcy.

Corcoran said it is owed $18,580 and Premier claimed to be due $54,576.

Steubenville created a trust designed to assure payment to produce suppliers, and sold its inventory to Clover Hill Foods of Bridgeville, the suit said. Clover Hill paid PNC $45,339 to satisfy a loan to Steubenville, and $7,540 was paid to Firest National to help pay on a loan to Steubenville.

On Feb. 15, First National “swept” a Steubenville bank account containing $45,247 in trust assets.

Each bank’s actions violate the trust provisions of the U.S. Perishable Agricultural Commodities Act, which Corcoran and Premier said makes the bank’s claims subordinate to the suppliers’, the suit said.

In its answer filed Friday, First National acknowledged receiving $7,540 from Clover Hill and absorbing the Steubenville account to pay down a loan balance, but argued the money was not trust assets.

First National filed its third party complaint against Mark A. and Margaret A. Longo, owners of Steubenville Foods, and Clover Hill asking that they be made to cover any money First National is ordered to pay as a result of the Corcoran/Premier suit.

Text Only
Business