Penn Dutch locations linger as ghost stores
Legal battles continue after contaminated sites shut down
More than a month after listeria contamination forced their permanent closure, Penn Dutch’s partially stocked Margate and Hollywood locations linger — still contaminated — like air-conditioned ghost ships as lawyers fight over the companies’ last remaining scraps.
A peek inside the Margate store this week showed bright fluorescent lights burning, wine and bagged snacks on the shelves, cartons of eggs stacked in a display cooler, ice cream in the freezer.
But no one will be buying those goods any time soon, if ever.
Decontamination has yet to begin at the former company’s shuttered locations as 12 different
attorneys have spent the past month fighting over what little is left of the company, including the remaining inventory and $240,000 in its frozen bank account.
Philip von Kahle, hired by the owners to oversee liquidation of the company’s remaining assets, asked a federal judge earlier this month to OK use of some of the funds for decontamination, arguing a cleanup must occur before any assets can be sold for the benefit of any creditor.
“Given the passage of time and the continued rotting of the remaining perishables at both locations (both produce and non-produce), the public health and contamination issues, both due to the listeria and due to increasing mold and other contaminants, have become more acute,” according to an Oct. 11 filing by Jason Slatkin, a Fort Lauderdale-based attorney representing von Kahle.
The stores’ furniture, fixtures and equipment will have to be sanitized “to prevent further public health issues,” the filing stated.
Two Broward County produce suppliers who secured temporary restraining orders to put themselves at the front of a long line of creditors refused to allow frozen funds to be used for cleanup, von Kahle’s filing stated.
But a court order signed Monday by U.S. District Judge Patrick M. Hunt authorized use of $75,000 to sanitize the Margate store “to minimize any adverse effect on the health of members of the public.”
Some of the cleanup money will be provided by the Margate store’s landlord, Penn Dutch Plaza LLC, which initiated eviction proceedings against the stores’ owners on Oct. 10.
The court order also stated that Penn Dutch’s Hollywood location, owned by two members of the stores’ founding Salsburg family, is being sold and that the buyer has agreed to fund “most of” the cleanup of that building.
On Wednesday, von Kahle declined through a spokeswoman to respond to questions about the dissolution, including when cleanup of the properties is scheduled to begin.
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Monday’s court order authorizes von Kahle to begin transfer and sale of property inside the Margate store and allows the Margate building’s landlord to pursue its eviction and retake possession of the property.
Jason Katz, a Daviebased attorney for the store’s landlord, confirmed by email Wednesday that the cleanup should begin “in short order.”
The building owner “has received interest from several grocers and retailers and anticipates announcing a new tenant to the shopping center in the near future,” Katz wrote.
Penn Dutch’s dissolution will likely require months to resolve, as more and more creditors submit claims to the Broward County Circuit Court overseeing the process.
When von Kahle was assigned to manage the dissolution, he filed documents stating that it owed its creditors $6.68 million but only had assets valued at $670,120.
Other proceedings against the company include:
A $30,053 claim by Miami-based Balter Meat Co., filed in a separate civil suit.
A claim by the Broward County Records, Taxes and Treasury Division for unpaid tangible tax. A Sept. 20 post outside the store declares “these assets are subject to seizure.”
A federal court claim on behalf of employees seeking severance pay under the federal Worker Adjustment and Retraining Notification Act. Penn Dutch failed to respond to the complaint before a court imposed deadline, and notice of default was entered by the clerk on Tuesday.
Stop-sale orders imposed by the state Department of Agriculture and Consumer Services remain in effect for the two stores, pending reinspections to determine that contamination has been eliminated.
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