Low apple prices may force fruit packer to file for bankruptcy

Associated Press

BREWSTER — A fruit warehouse here may have to file for protection from creditors in U.S. Bankruptcy Court after six years of low prices for apples, its chief executive officer says.

"I won’t gloss over the fact that we have difficulties," said George Chapman, CEO and general manager at Brewster Heights Packing.

"Everybody is working hard to keep this going. There’s going to be some changes. There will have to be some reorganization.

"I believe if we file for reorganization under Chapter 11, the judge is going to be very sympathetic of the economic situation of this county."

So far, creditors have filed two lawsuits against Brewster Packing, one of the largest fruit warehouses in the state.

In a Jan. 9 lawsuit filed in Chelan County Superior Court, Prudential Insurance Co. of America said Brewster Heights Packing and its associated businesses and owners have defaulted on a $29 million mortgage loan. The lawsuit asks the court to appoint a receiver to take possession of the property and to manage operations.

In a lawsuit filed last week in Okanogan County Superior Court, North Cascades National Bank said Brewster Heights Packing defaulted on a $1.26 million loan last year. The court granted the bank a temporary restraining order preventing the fruit warehouse from withdrawing $1.4 million from a bank account.

Brewster Heights was founded in 1971 by Ed Pariseau, who retired last fall, and Dan Gebbers. It was one of the first companies to market Granny Smith apples. In recent years, the company has planted large tracts of Fuji apples and late-season cherries.

Brewster Heights employs about 200 people now, although about 2,000 people work for the warehouse and in its orchards seasonally. The warehouse and the orchards are currently Okanogan County’s largest private employers, said county commissioner Craig Vejraska.

"This is certainly a major, major setback in Okanogan County," Vejraska said. "Unfortunately, it’s indicative of what’s going on throughout the apple industry."

Three Okanogan County packing operations have closed since 2000: Chief Tonasket, Regal Fruit and Dole Northwest. Dole also closed facilities in East Wenatchee and Chelan Falls. Chief Wenatchee closed last fall in Wenatchee.