Ibay, Incorporated v. United States ( 1997 )

UNPUBLISHED
UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT
IBAY, INCORPORATED, t/a Bay
Seafood,
Plaintiff-Appellant,
No. 97-1558
v.
UNITED STATES OF AMERICA,
Defendant-Appellee.
Appeal from the United States District Court
for the Eastern District of Virginia, at Norfolk.
Raymond A. Jackson, District Judge.
(CA-96-908-2)
Submitted: November 18, 1997
Decided: December 2, 1997
Before MURNAGHAN, HAMILTON, and
WILLIAMS, Circuit Judges.
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Affirmed by unpublished per curiam opinion.
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COUNSEL
C. Jay Robbins, IV, NUNNALLY & ROBBINS, Norfolk, Virginia,
for Appellant. Anita K. Henry, Assistant United States Attorney,
UNITED STATES ATTORNEY'S OFFICE, Norfolk, Virginia, for
Appellee.
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Unpublished opinions are not binding precedent in this circuit. See
Local Rule 36(c).
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OPINION
PER CURIAM:
Appellant Ibay, Inc., appeals from a district court order granting
Defendant's motion for summary judgment on its complaint seeking
review of an administrative decision by the United States Department
of Agriculture. On appeal, Ibay asserts the court erred by finding it
failed to produce sufficient evidence to establish that it was entitled
to a civil penalty in lieu of disqualification from participation in the
food stamp program and by not conducting a de novo trial on the mer-
its. Finding no reversible error, we affirm.
Ibay operated a store ("Bay Seafood") specializing in the sale of
seafood. The store participated in the food stamp program. In March
1996, the Department of Agriculture, Food and Consumer Services
Division ("FCS"), conducted an investigation into the food stamp
practices at Bay Seafood. On two occasions, an undercover investiga-
tor sold food stamps to a store employee for cash in violation of food
stamp statutes and regulations. In his application to participate in the
food stamp program, Ibay's owner signed a certification acknowledg-
ing that he understood that his authorization to accept food stamps
could be revoked if any of his employees violated the applicable stat-
utes and regulations.
The FCS filed a formal charge against Ibay for illegal trafficking
of food stamp coupons and gave Ibay the opportunity to submit docu-
mentation supporting its request for a civil penalty in lieu of perma-
nent disqualification from participation in the food stamp program.
Although given a lengthy extension, Ibay failed to provide any docu-
mentation at the administrative level, and Ibay's permanent disqualifi-
cation was affirmed. Ibay submitted affidavits before the district
court, but the court found the evidence insufficient to withstand sum-
mary judgment.
2
Summary judgment is appropriate when there is "no genuine issue
of material fact," given the parties' burdens of proof at trial. Anderson
v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986); Fed. R. Civ. P.
56(c). In determining whether the moving party has shown that there
is no genuine issue of material fact, a court must assess the factual
evidence and all inferences to be drawn therefrom in the light most
favorable to the non-moving party. See Ross v. Communications Sat-
ellite Corp., 759 F.2d 355, 364 (4th Cir. 1985). We review a grant of
summary judgment de novo. See Higgins v. E.I. DuPont de Nemours
& Co., 863 F.2d 1162, 1167 (4th Cir. 1988). We conclude the district
court properly granted the Defendant's motion.
The applicable statutes and regulations are clear that participants in
the food stamp program may be disqualified or fined for various vio-
lations, and when the offense involves the trafficking of food stamp
coupons, the sanction is permanent disqualification. 1 The FCS, in its
discretion, may impose a civil penalty in lieu of disqualification under
certain conditions if the store submits substantial evidence to support
its request.2 To qualify, the store must produce substantial evidence
showing that: (1) it developed an effective compliance program;
(2) both its compliance policy and program were in operation at the
location where the violations occurred prior to the offenses in ques-
tion; (3) the store had an effective training program in place and that
the employee involved attended the program; and (4) neither the
owner nor manager were aware of, approved of, or benefited from the
illegal conduct.3
Ibay failed to present any evidence at the administrative level.
Moreover, we find the conclusory affidavits it submitted below were
insufficient to withstand summary judgment. Ibay did not present any
dated training materials or other documentation showing the existence
of an effective compliance program prior to the offenses or showing
that the employee involved received such training. It simply produced
affidavits stating that it had such programs and that neither the owner
nor management was aware of, approved of, or benefited from the
illegal trafficking.
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1 See 7 U.S.C. § 2021(b)(3)(B) (1994).
2 See 7 C.F.R. § 278.6 (i) (1997).
3 Id.3
We further reject Ibay's assertion that the district court erred by
granting summary judgment instead of conducting a trial on the mer-
its. The existence of a violation was undisputed. The only issue was
the appropriate sanction. The applicable statutes and regulations give
a reviewing court authority to review only the finding of a violation
de novo; the extent of the sanction, as long as it is within the authority
of the FCS, is subject to limited review.4 We find that Ibay failed to
present substantial evidence that the FCS acted arbitrarily or capri-
ciously in denying its request for a civil penalty in lieu of permanent
disqualification. Since there were no issues of material fact, we find
that the district court properly granted the Defendant's motion for
summary judgment.
We therefore affirm the district court's order. We dispense with
oral argument because the facts and legal contentions are adequately
presented in the material before the court and argument would not aid
the decisional process.
AFFIRMED
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4 See Goldstein v. United States , 9 F.3d 521, 523-24 (6th Cir. 1993).
4