Fresno-based Assemi Brothers LLC has been ordered to pay millions of dollars to a lender as part of the lawsuit with The Wonderful Company.
The ruling from Fresno County Superior Court Judge Jeffrey Hamilton was submitted late last month.
The backstory: In May 2014, Assemi Brothers agreed to a loan with Independent Financing Services, a lender affiliated with the Wonderful Company, for up to $75 million.
- A provision in the loan agreement stated that if Assemi Brothers defaulted on the loan, Independent Financing Services would have the right to immediately accelerate the loan and demand payment for the entire principal and interest.
- Defaulting on the loan included any time that Wonderful Pistachios & Almonds processed less than 100 percent of the pre-2020 crop, any time the Assemi Growers entered into a binding agreement that Wonderful would not process 100 percent of its Pre-2020 crop or at any time Assemi Growers declared interest to sell or deliver any of the pre-2020 crop to a third party or process itself.
- Independent Financing Services sent a notice of default to Assemi Brothers in September 2019 and did not receive a response.
- Independent Financing Services filed a motion for breach of contract against Assemi Brothers as part of the Wonderful lawsuit.
The big picture: The loan judgment in and of itself is, compared to the bulk of litigation, insignificant. Between the initial litigation filed by the Assemi family and countersuit from The Wonderful Company, damages could potentially reach into the nine figures.
- Hamilton ruled in favor of Independent Financing Services, finding that Wonderful processed less than 100 percent of Assemi Brothers’ 2019 pistachio crops.
- Assemi Brothers agreed that Wonderful did not process 100 percent of its crop, but argued that there was an implied term in the note that provided an option to terminate its obligations if Wonderful refused to pay the full amount agreed on for processing pistachios.
- Hamilton ruled that the loan note had “clear and unambiguous terms,” rejecting the argument from the Assemi Brothers.
What we’re watching: Assemi Brothers have been ordered to repay $2,489,752.88 of principal to Independent Financing Services.
- The court also ordered Assemi Brothers to pay $142,563.93 in interest at a 10 percent annual rate from March 23 through Oct. 16, the day the judgment was entered.
- The entire amount that Assemi Brothers will have to pay is still unclear, however, since 10 percent interest is owed post-judgement until paid, as well as attorneys’ fees.