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Atlantic Deli & Grocery v. United States of America

May 23, 2011


The opinion of the court was delivered by: Honorable Jerome B. Simandle


SIMANDLE, District Judge:


This matter comes before the Court on the motion for summary judgment of Defendants United States of America and Tom Vilsack, United States Secretary of Agriculture ("Defendants"). [Docket Item 12.] Plaintiff, Atlantic Deli & Grocery, operates a small retail food store located at 3833 Atlantic Avenue in Atlantic City, New Jersey, that is authorized to participate in the Supplemental Nutrition Assistance Program ("SNAP"), formerly known as the Food Stamp Program. Plaintiff seeks judicial review of the administrative action of Defendants, acting through the Food and Nutrition Service ("FNS") of the United States Department of Agriculture ("USDA"), to disqualify Plaintiff's store from participating in SNAP for a period of six months as a penalty for a first-time violation of the terms of the program. For the reasons stated below, the Court will grant Defendants' motion for summary judgment and dismiss Plaintiff's action.


Plaintiff Atlantic Deli & Grocery is owned and operated by co-owners Israt Jahan and Farzana Begum. The store was authorized to participate in SNAP as a retail food store in May 2003. (Pascal Decl. Ex. A at A.R. 20.)*fn1 Over the next several years, Plaintiff was warned in letters sent by FNS on more than one occasion that the store was suspected of violating the food stamp program regulations. (See A.R. 22-24.) Beginning in January of 2008, FNS conducted an investigation of Plaintiff's store. (A.R. 31.) Specifically, an FNS investigator visited Plaintiff's store on six occasions*fn2 over a period of three months, and on five of those occasions attempted to purchase items ineligible under the food stamp program with a SNAP card (A.R. 31.) Each attempt to purchase unauthorized items (specifically, non-food items such as dish soap and sponges) was successful. On the final visit, the investigator also attempted a "trafficking" transaction, in which stamps were offered in exchange for cash, but was rejected by the store clerk. (A.R. 49.)

On June 5, 2008, FNS sent Plaintiff a charge letter reporting the results of the investigation, and warning Plaintiff that Atlantic Deli & Grocery was being considered for a six-month disqualification from SNAP for the sale of ineligible "nonfood" items. (A.R. 29.) On July 2, 2008, FNS issued its decision finding that Plaintiff committed the SNAP violations cited in the charge letter, and informing the co-owners that Atlantic Deli & Grocery would be disqualified from SNAP for six months because of the violations. (A.R. 58-59.) The July 2 letter also explained that FNS had considered imposing a civil money penalty on Atlantic Deli & Grocery in lieu of disqualification, but deemed that the store was not eligible for the civil penalty because of the existence of other SNAP-authorized retail stores in the area, thereby assuring the agency that food stamp recipients would not suffer hardship as a result of the disqualification. (Id.)

On July 16, 2008, the co-owners of Atlantic Deli & Grocery sent FNS an appeal letter, requesting review of the disqualification. (A.R. 61.) The letter states "[a]lthough we did not find any definite clue of how the mistake had happened, we are not in a position to deny the fact that any of our low trained employees might had entered a transaction that should not had happened at all." (Id.) The letter goes on to explain that the store would institute a new training policy, ensuring that only trained employees would handle food stamp transactions, and apologizing for the "unintentional mistake that your agency had noticed." (Id.) The letter concludes with a plea for sympathy and request to not impose the disqualification.

FNS assigned the appeal to an administrative review officer, who contacted Plaintiff and requested any additional information that would help her conduct her review of the case. (A.R. 63.) The six month disqualification was stayed during the two-year pendency of the administrative appeal. On July 26, 2010, FNS issued its final agency decision, concluding that there was sufficient evidence to support the finding of the SNAP violations as charged, and that the six-month disqualification penalty was proper for violations of SNAP rules committed by employees not fully aware of SNAP rules. (A.R. 70.)

On August 24, 2010, Plaintiff filed the instant action, seeking judicial review of Defendants' disqualification determination. [Docket Item 1.] On September 15, Plaintiff filed an emergency motion for a preliminary injunction, seeking to extend the stay of disqualification pending the resolution of this Court's review. [Docket Item 6.] On September 20, 2010, the parties stipulated to a stay of the disqualification, and Plaintiff subsequently withdrew its motion for preliminary relief. [Docket Items 10 & 11.] On October 6, 2010, in lieu of an answer and prior to the parties conducing any new discovery, Defendants filed the instant motion for summary judgment. [Docket Item 12.]


A. Standard of Review

The final determination by FNS is subject to de novo review by the district court at the request of an aggrieved party, 7 U.S.C. §§ 2023(a)(13), (15), as discussed below.

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). A fact is "material" only if it might affect the outcome of the suit under the applicable rule of law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Summary judgment will not be denied based on mere allegations or denials in the pleadings; instead, some evidence must be produced to support a material fact. Fed. R. Civ. P. 56(c)(1)(A); United States v. Premises Known as 717 S. Woodward Street, Allentown, Pa., 2 F.3d 529, 533 (3d Cir. 1993). The nonmoving party must "do more than simply show that there is some metaphysical doubt as to the material facts." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574 (1986). ...

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