Saving Seafood

MASSACHUSETTS: National Fish files for bankruptcy

June 10, 2019 — National Fish & Seafood no longer operates in East Gloucester, having given way — and rise — to Atlantic Fish & Seafood in a recent asset sale.

But that does not mean the federal bankruptcy court or National Fish creditors are done with the former seafood processor.

National Fish, which shut down its operations on May 10 after failing to find a buyer for the financially beleaguered company, stated in May 29 filings in U.S. Bankruptcy Court in Boston that it owes more than $80 million to all its creditors — including more than $64 million to secured creditors and $16 million to unsecured creditors.

“The board of directors for the company, having been fully apprised of all of the material facts related to the financial condition of the company, has determined it is in the best interests of the company, its creditors, and other parties in interest, that the company should cease operations and be liquidated under the supervision of the United States Bankruptcy Court,” National Fish’s board of directors stated in a unanimous written consent included in a May 29 filing.

The filings also confirm two other noteworthy items:

National Fish sold its assets to NSD Seafood Inc.  — the parent of Atlantic Fish & Seafood — for $3 million and National Fish’s largest creditor is the Dutch multinational bank Cooperative Rabobank, to which it owes “approximately $73 million in principal (plus interest, fees and other charges).”

Read the full story at the Gloucester Daily Times

National Fish & Seafood revived under new ownership, new name

May 24, 2019 — The assets of Gloucester, Massachusetts, U.S.A.-based National Fish & Seafood (NFS) have been purchased by NSD Seafood, which said in a 22 May announcement it planned to restart production of NFS’ Matlaw’s stuffed clam line and other products.

NFS abruptly closed its doors on 10 May. SeafoodSource first broke the story on 20 May that an unnamed buyer wanted to acquire NFS and resume the company’s operations. On 22 May, NSD Seafood agreed to purchase all of National Fish’s assets and rename the company Atlantic Fish & Seafood, according to the Gloucester Daily Times. The operations team is hoping to begin production within a week at NFS’s former 60,000-square-feet facility in Gloucester.

Nicholas M. Osgood, a principal in NSD Seafood, along with two other partners from the NSDJ Real Estate company that owns NFS’s 159 E. Main St. facility, acquired NFS’s assets, according to the Gloucester Daily Times.

Read the full story at SeafoodSource

National Fish, Tampa Bay resolve trade secrets case

March 11, 2019 –A federal judge dismissed National Fish & Seafood’s (NFS) trade secrets case against Tampa Bay Fisheries, its parent company Red Chamber, and former employee Kathleen Scanlon after the companies agreed to resolve the lawsuit.

Pacific Andes-owned NFS and Tampa Bay “jointly announce that they have satisfactorily resolved the lawsuit brought by NFS against Tampa Bay, Kathleen Scanlon, Red Chamber Co., and certain individuals affiliated with Tampa Bay,” the companies said in a statement provided to SeafoodSource.

As a result of the confidential settlement, all claims will be dismissed, NFS and Tampa Bay said.

Read the full story at Seafood Source

Judge sets deadlines in fish espionage case

March 5, 2019 — The opposing sides in the industrial espionage lawsuit filed by National Fish & Seafood against a Florida competitor have spent much of the past two months wrangling over discovery and a federal judge has set deadlines that could end the squabbling and allow the case to move forward.

U.S. District Court Judge M. Page Kelly on Friday acceded to requests from Gloucester-based National Fish and Florida-based Tampa Bay Fisheries and other defendants to extend the deadlines for discovery.

Kelly, who sits in federal court in Boston, set March 15 as the deadline for all written fact discovery and April 15 for the close of all fact discovery.

In its lawsuit, National Fish claims that executives at Florida-based Tampa Bay Fisheries encouraged and conspired with Kathleen A. Scanlon, a former National Fish employee, to copy “substantial volumes of NFS’ confidential business information and trade secrets”  in her final days at National Fish before she started a position with Tampa Bay Fisheries.

Scanlon, who rose to chief of research and development and quality control in her 23 years at National Fish, denies the allegations, as do the other Tampa Bay executives named as defendants.

Read the full story at the Gloucester Daily Times

National Fish exec appeals prison term

January 18, 2019 — Jack Ventola, the imprisoned founder and president of Gloucester-based National Fish & Seafood, is appealing his two-year prison sentence, claiming he received a more severe punishment than one of his convicted co-conspirators.

Ventola, 71, is in the midst of his 24-month sentence at the Federal Medical Center Devens he started last July. He was convicted April 27 in U.S. District Court in Boston of failure to pay taxes on $2.9 million he fraudulently diverted from National Fish in schemes that ran from 2006 to 2013.

As part of his plea deal, Ventola admitted conspiring with two other National Fish executives — senior sales executive Richard J. Pandolfo and head of operations James Corbett, who died in 2013 and was never criminally charged —and National Fish accountant and board member Michael Bruno in several schemes to defraud the IRS and majority National Fish owner Pacific Andes.

Read the full story at the Gloucester Daily Times

Ex-fish exec’s fraud sentence: 2 years in prison, $1.2M restitution

September 21, 2018 — Another former National Fish & Seafood executive is on his way to federal prison. But not for anything he did while director of sales at National Fish.

James R. Faro, 62, who worked at Gloucester-based National Fish from 2012 until approximately January, was sentenced Monday in U.S. District Court to two years in federal prison and ordered to pay $1.21 million in restitution.

Faro was convicted of conspiring to commit bank fraud at Marlborough-based Sea Star Seafood Corp., the frozen seafood distributor he founded in 1983.

As part of a plea agreement with federal prosecutors, Faro admitted that he and John Crowley, the chief financial officer at Sea Star, conspired to defraud the Commerce Bank & Trust Company of Worcester by lying about the value of Sea Star’s outstanding accounts receivable to increase its borrowing limits.

Jack Ventola, the founder and president of National Fish, currently is serving a two-year sentence at the minimum-security Federal Medical Center, Devens in central Massachusetts after pleading guilty to failure to pay taxes on $2.9 million he “fraudulently diverted” from National Fish’s majority owners.

Ventola also was ordered to pay $1.07 million in restitution to the Internal Revenue Service.

Ventola admitted to conspiring with two other National Fish executives — senior sales executive Richard J. Pandolfo and an unnamed head of operations — and National Fish accountant and director Michael Bruno to defraud the IRS and Pacific Andes in a scheme involving a temporary labor company.

Read the full story at the Gloucester Daily Times

Processor: New hire had no know-how to steal fish secrets

September 14, 2018 — Tampa Bay Fisheries, the Florida seafood company that Gloucester-based National Fish & Seafood accuses of stealing trade secrets, has come out swinging in its first response to the charges.

In a document filed in U.S. District Court in Boston, Tampa Bay Fisheries characterized the civil lawsuit filed by NFS as “a fish tale about the one that got away” and claimed it never obtained any of the Gloucester seafood processor’s secrets.

The document was filed in opposition to NFS’ motion for a preliminary injunction. It  highlighted financial problems at NFS parent company Pacific Andes International Holdings — which is in the midst of an extraordinarily complex bankruptcy proceeding — and the criminal convictions of three top NFS executives or board members during the past two years.

“This is not a case about Tampa Bay seeking any information whatsoever from NFS,” Tampa Bay’s lawyers argued in their filing. “This is a case about NFS, a bankrupt company run by investors and still reeling from its top executives’ criminal convictions, seeking a pretext to undermine Tampa Bay’s legitimate success. The evidence is clear — there is no scheme and no grand conspiracy.”

U.S. District Court Judge Leo T. Sorokin has yet to rule on NFS’ motion for the preliminary injunction.

Read the full story at the Gloucester Daily Times

MASSACHUSETTS: Company widens net in seafood secrets case

August 27, 2018 — National Fish & Seafood and Kathleen A. Scanlon, the former employee the seafood processor is suing for allegedly stealing trade secrets for her new employer, had appeared to be heading for a settlement.

Now, not so much.

The Gloucester-based seafood processor last week amended its complaint against Scanlon, its former head of research and development and quality assurance, and her new employer, Tampa Bay Fisheries, by adding more defendants and more details of the alleged conspiracy and corporate theft.

The revised lawsuit, filed in U.S. District Court in Boston, now levies charges against more executives from Tampa Bay Fisheries and its affiliates — including company President Robert Paterson, information technologies director Mark Marsh and Mark Pandolfo. The revised complaint also includes the John Doe named as a defendant in the original lawsuit.

Pandolfo, a vice president of sales at Tampa Bay Fisheries’ Kitchens Seafood affiliate, is a former NFS employee and the son of Richard Pandolfo, a former NFS vice president for sales who was convicted last year of wire fraud and defrauding the Internal Revenue Service in a scheme with other NFS executives.

Read the full story at the Gloucester Daily Times

National Fish accuses former employee of sharing trade secrets in recent lawsuit

July 26, 2018 –Kathleen Scanlon – the former head of research, development, and quality assurance for National Fish & Seafood – was ordered not to work for her new employer, Tampa Bay Fisheries, and return National Fish property in a heated court battle.

Pacific Andes-owned National Fish, based in Gloucester, Massachusetts, filed a complaint against Scanlon, Tampa Bay, and a “John Doe” on 20 July, alleging that Scanlon “unlawfully acquired NFS’ confidential information and trade secrets” involving its proprietary clam production process.

NFS, which markets the longstanding Matlaw’s stuffed clam and seafood line, said Scanlon’s action were “part of a scheme to harm NFS’ position in the seafood-supply industry,” according to the complaint filed in U.S. District Court in Boston.

Dover, Florida-based Tampa Bay Fisheries specializes in private label seafood for retailers and restaurants. Both suppliers recently tried to secure a national listing with Whole Foods Market, according to the complaint.

After working for NFS for 20 years, Scanlon voluntarily resigned on 11 July. She was set to begin working for Tampa Bay Fisheries on 23 July.

Read the full story at Seafood Source

National Fish & Seafood sues former employee

July 25, 2018 — Care for a side order of alleged corporate espionage with your stuffed clams? Belly on up to the bar.

As in the legal bar.

Gloucester-based National Fish & Seafood is accusing its former head of research, development and quality assurance of absconding with confidential processing information and other corporate trade secrets when she resigned recently to take a similar position with a Florida-based seafood competitor.

In a civil lawsuit filed Friday in U.S. District Court in Boston, NFS alleges Kathleen A. Scanlon, who worked at NFS for more than 20 years before resigning about two weeks ago, used company-issued equipment to help steal confidential recipe, processing and customer information as a means of assisting her new employer, Tampa Bay Fisheries Inc. of Dover, Florida.

The suit also names Tampa Bay Fisheries as a co-defendant, along with an unnamed John Doe at Tampa Bay Fisheries who allegedly helped hatch the plan.

Officials at Tampa Bay Fisheries did not respond to phone calls Monday seeking comment.

Read the full story at the Gloucester Daily Times