PACA-MAN devours all comers!

Acronym for Perishable Agricultural Commodities Act. Federal legislation that provides suppliers of certain agricultural products with extraordinary protections that sometimes bedevil a debtor’s other creditors, even its secured lenders. If a supplier meets the PACA requirements, the products it delivers (and the proceeds of those products including inventory, accounts receivable, and cash derived from the products) are treated as though they are the supplier’s property rather than the debtor’s property, the debtor holds them in trust for the benefit of the supplier, and the supplier’s claim trumps the lender’s otherwise superior lien on the products.

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