Calhoun v. USDA Farm Service Agency

Decision Date12 March 1996
Docket NumberCivil Action No. 4:95cv365-D-B.
Citation920 F. Supp. 696
PartiesJohn C. CALHOUN, III, Plaintiff, v. USDA FARM SERVICE AGENCY, Defendant.
CourtU.S. District Court — Northern District of Mississippi

COPYRIGHT MATERIAL OMITTED

Preston Davis Rideout, Greenwood, Mississippi, for Plaintiff.

Ralph Dean, Oxford, Mississippi, for Defendant.

MEMORANDUM OPINION

DAVIDSON, District Judge.

Presently before the court is the motion of the plaintiff for preliminary injunctive relief pursuant to Fed.R.Civ.P. 65, and the defendant's motion to dismiss or for summary judgment on the plaintiff's claims. Finding that the plaintiff has failed to demonstrate a substantial likelihood that he will prevail on the merits of this action, based upon his failure to exhaust available administrative remedies, the motion for preliminary injunctive relief shall be denied, and the motion to dismiss or for summary judgment shall be granted.

Factual Background

Most of the basic facts surrounding this case are not in dispute between the parties. The plaintiff in this cause, Mr. John C. Calhoun, III, borrowed approximately $410,000.00 in loan assistance from the United States of America, Department of Agriculture, through the Farmers Home Administration1, during the period of May 1974 to May of 1982. Mr. Calhoun defaulted on the repayment of these loans, and the Federal Land Bank of New Orleans foreclosed upon the 587 acres of land in Carrol County, Mississippi, which stood as partial security for the debt. The FmHA bought the 587 acres at the foreclosure sale, and title was transferred to the United States by deed dated December 20, 1983.

After the purchase of the property by FmHA, there were numerous communications between FmHA officials and Mr. Calhoun. In 1990, Mr. Calhoun made an offer to buy the property contingent upon FmHA financing. FmHA declined the offer by letter dated November 2, 1990. FSA2 then offered the property to the public for sale on February 16, 1995, and Calhoun again made an offer to purchase the property. This time, however, Calhoun had obtained private financing for the purchase. Calhoun was placed in a class with several other prospective purchasers, and "straws were drawn" to determine which prospective buyer would be permitted to purchase the property. Mr. Calhoun was not chosen.

Mr. Calhoun filed this action to challenge his placement with other potential purchasers of the property for purposes of the 1995 offer to sell the property. His contention is that pursuant to 7 U.S.C. § 1985(e)(1)(C)(i), FSA is required to give him preference over all other persons seeking to purchase this property, and he seeks injunctive relief from this court to prevent the transfer of the title of this property from the United States to the successful bidder.3

DISCUSSION
I. STANDARD FOR THE GRANTING OF A PRELIMINARY INJUNCTION

In making its ruling on the propriety of a preliminary injunction, this court is bound by the considerations contained in the decision of Canal Authority of Florida v. Callaway and its progeny. Canal Authority of Florida v. Callaway, 489 F.2d 567, 572 (5th Cir.1974). Pursuant to this authority, the plaintiff in this matter has the burden of demonstrating to this court four specific criteria:

(1) a substantial likelihood that plaintiff will prevail on the merits;
(2) a substantial threat that plaintiff will suffer irreparable injury if the injunction is not granted;
(3) that the threatened injury to plaintiff outweighs the threatened harm the injunction may do to defendant; and,
(4) that granting the preliminary injunction will not disserve the public interest.

Rodriguez v. United States, 66 F.3d 95, 97 (5th Cir.1995) (citing Canal Authority, 489 F.2d at 572); Cherokee Pump & Equip. v. Aurora Pump, 38 F.3d 246, 249 (5th Cir. 1994) (same). It is incumbent upon the plaintiff to demonstrate all of the four factors, and the failure to demonstrate any one of the four is sufficient to the court to deny the issuance of an injunction. "A preliminary injunction is an extraordinary remedy. It should only be granted if the movant has clearly carried the burden of persuasion on all four Callaway prerequisites. The decision to grant a preliminary injunction is to be treated as the exception rather than the rule." Cherokee Pump, 38 F.3d at 249 (quoting Mississippi Power & Light v. United Gas Pipe Line Co., 760 F.2d 618, 621 (5th Cir.1985) (emphasis added)).

II. LIKELIHOOD OF PREVAILING ON THE MERITS
A) THE EXHAUSTION OF ADMINISTRATIVE REMEDIES

At the time that the defendant offered the property for public sale, Mr. Calhoun had available to him an organized appeal process within which to challenge his status among the prospective purchasers. Further, FSA informed him of such an appeal process at the time they informed Calhoun that he was being categorized with the other purchasers. Mr. Calhoun had previously, although unsuccessfully, made similar appeals of prior adverse decisions by the FSA. FSA informed the plaintiff of its decision to place him in "Category V"4 along with other persons who wished to purchase the subject property by letter dated May 10, 1995. An attachment to the letter stated that he had thirty (30) days within which to appeal that decision. The plaintiff filed an appeal of his classification on November 22, 1995. On December 5, 1995, the National Appeals Staff denied Calhoun's appeal as untimely.

The defendant argues that Mr. Calhoun failed to exhaust his administrative remedies, and that therefore his request for injunctive relief should be denied and his case dismissed. Mr. Calhoun does not dispute that he failed to exhaust his administrative remedies, but urges this court to apply an exception to the exhaustion requirement and permit his claim to go forward.

The requirement that a plaintiff exhaust his administrative remedies can be of two types: 1) it can be mandated by federal statute, or 2) it can be imposed through the judicially-created doctrine of exhaustion. "There is a distinct difference between statutorily mandated exhaustion of administrative remedies and the judicially created doctrine of exhaustion of administrative remedies." Information Resources, Inc. v. United States, 950 F.2d 1122, 1126 (5th Cir.1992); see also Power Plant Div., Brown & Root, Inc. v. Occupational Safety & Health Review Comm., 673 F.2d 111, 115 (5th Cir. Unit B 1982).

When the requirement is mandated by statute, exhaustion becomes a jurisdictional prerequisite to maintaining an action. E.g., Wilson v. Sec., Dept. of Veterans Affairs, 65 F.3d 402, 404 (5th Cir.1994) (stating statutory exhaustion jurisdictional prerequisite to Title VII action); Shah v. Quinlin, 901 F.2d 1241, 1244 (5th Cir.1990) (stating statutory exhaustion jurisdictional prerequisite to claim under Federal Tort Claims Act); Gustin v. Internal Revenue Serv., 876 F.2d 485, 488 (5th Cir.1989) (stating statutory exhaustion jurisdictional prerequisite to claim for refund of federal income taxes). Judicial discretion in the application of statutorily mandated exhaustion is severely limited. Nonetheless, a few narrow exceptions still may apply. E.g., Greater Slidell Auto Auction, Inc. v. American Bank & Trust Co., 32 F.3d 939, 942 n. 2 (5th Cir.1994) (noting exceptions to statutory exhaustion where 1) claimant asserts constitutional challenge collateral to his substantive claim, 2) administrative system itself is unlawful or unconstitutional, or 3) "administrative remedies are inadequate.").

Not every federal statute which provides for administrative review mandates exhaustion as a requisite for judicial review, however. In order for exhaustion to be mandated by statute, and thereby jurisdictional, Congress must have specifically provided for such. McCarthy v. Madigan, 503 U.S. 140, 144, 112 S.Ct. 1081, 1086, 117 L.Ed.2d 291, 299 (1992) ("Where Congress specifically mandates, exhaustion is required."). Congress has heretofore been very explicit when it has determined exhaustion to be a jurisdictional prerequisite to federal court jurisdiction. For example:

No suit or proceeding shall be maintained in any court for the recovery for any internal revenue tax alleged to have been erroneously or illegally assessed or collected, or of any penalty claimed to have been collected without authority, or of any sum alleged to have been excessive or in any manner wrongfully collected, until a claim for refund or credit has been duly filed with the Secretary, according to the provisions of law in that regard, and the regulations of the Secretary established in pursuance thereof.

United States v. Williams, 514 U.S. ___, ___ n. 5, 115 S.Ct. 1611, 1616 n. 5, 131 L.Ed.2d 608, 615 n. 5 (1995) (citing 26 U.S.C. § 7422(a) for proposition that exhaustion required to waive sovereign immunity, conferring jurisdiction over claims involving income tax liens).

An action shall not be instituted upon a claim against the United States for money damages for injury or loss of property or personal injury or death caused by the negligence or wrongful act or omission of any employee of the Government ... unless the claimant shall have first presented the claim to the appropriate Federal agency and his claim shall have been finally denied by the agency ...

McNeil v. United States, 508 U.S. 106, 107 n. 1, 113 S.Ct. 1980, 1981 n. 1, 124 L.Ed.2d 21, 25 n. 1 (1993) (citing 28 U.S.C. § 2675(a) of Federal Tort Claims Act); see Shah, 901 F.2d at 1244 (exhaustion jurisdictional prerequisite to claim under FTCA).

The judicially created doctrine of exhaustion, however, is more flexible. The general rule remains that a party is required to exhaust available administrative remedies before arriving at the federal courthouse to seek relief. McCarthy v. Madigan, 503 U.S. 140, 144, 112 S.Ct. 1081, 1086, 117 L.Ed.2d 291, 299 (1991). However, "where Congress has not clearly required exhaustion, sound judicial discretion governs." McCarthy, at 144, 112 S.Ct. at 1086, 117 L.Ed.2d...

To continue reading

Request your trial
9 cases
  • Ace Prop. Ins. v. Crop Ins. and Risk Management
    • United States
    • United States District Courts. 8th Circuit. United States State District Court of Southern District of Iowa
    • February 10, 2005
    ...[§ 6912(e)] administrative remedies is not a jurisdictional matter."); In re Cottrell, 213 B.R. 33, 37 (M.D.Ala.1997) (declining to accept Calhoun's determination that § 6912(e) imposes a jurisdictional prerequisite to filing In Bastek v. Federal Crop Ins. Corp., the Second Circuit found th......
  • Statute of Limitations and Settlement of Equal Credit Opportunity Act Discrimination Claims Against the Department of Agriculture, 98-2
    • United States
    • Opinions of the Office of Legal Counsel of the Department of Justice
    • January 29, 1998
    ...... . Filing. an administrative claim with USDA does not toll ECOA's. statute of limitations. . . ... government or governmental subdivision or agency, trust,. estate, partnership, cooperative, or ...The Department of Agriculture's. ("USDA's") farm credit programs fall under the. authority of the FTC. The ... Under section 640 of the 1995 Treasury, Postal Service and. General Government Appropriations Act, Congress ... covered by National Appeals Division); Calhoun v. USDA. Farm Serv. Agency, 920 F.Supp. 696 (N.D. Miss. ......
  • Casarez v. Val Verde County
    • United States
    • United States District Courts. 5th Circuit. Western District of Texas
    • January 24, 1997
    ...than the rule. Mississippi Power & Light Co. v. United Gas Pipe Line Co., 760 F.2d 618, 621 (5th Cir.1985); Calhoun v. USDA Farm Serv. Agency, 920 F.Supp. 696, 699 (N.D.Miss.1996) (quoting Cherokee Pump & Equip., Inc. v. Aurora Pump, 38 F.3d 246, 249 (5th Cir.1994)). In order to obtain a pr......
  • In re 2000 Sugar Beet Crop Ins. Litigation
    • United States
    • United States District Courts. 8th Circuit. United States District Court of Minnesota
    • September 26, 2002
    ...F.Supp.2d 791 (N.D.Ohio 2000) (requiring 7 U.S.C. § 6912(e) exhaustion in suit against the FmHA); Calhoun v. United States Dep't of Agric. Farm Serv. Agency, 920 F.Supp. 696 (N.D.Miss.1996) (finding 7 U.S.C. § 6912(e) exhaustion a prerequisite to suit); Gleichman v. United States Dep't of A......
  • Request a trial to view additional results
2 books & journal articles
  • CHAPTER 4 DEFENDING FEDERAL DECISIONS AND PERMITS: PRACTICAL TACTICS FOR THE INTERESTED PARTY
    • United States
    • FNREL - Special Institute Natural Resources and Environmental Administrative Law and Procedure II (FNREL)
    • Invalid date
    ...Serv., 183 F.3d 196, 200-02 (3d Cir. 1999); Bentley v. Glickman, 234 B.R. 12, 19 (N.D.N.Y. 1999); Calhoun v. USDA Farm Serv. Agency, 920 F. Supp. 696, 702 (N.D. Miss. 1996); Gleichman v. United States Dep't of Agriculture, 896 F. Supp. 42, 45-46 & n.4 (D. Me. 1995). Apart from the mandatory......
  • Blunt Forces: A Case Study of Administrative Exhaustion Under the Controlled Substances Act.
    • United States
    • Case Western Reserve Law Review Vol. 73 No. 2, December 2022
    • December 22, 2022
    ...programs that Congress has charged them to administer"); Lubbers, supra note 77, at 111. (80.) See Calhoun v. USDA Farm Serv. Agency, 920 F. Supp. 696, 700 (N.D. Miss. 1996) (citing several cases where courts have found statutory exhaustion as a prerequisite for federal (81.) 641 F.3d 423 (......

VLEX uses login cookies to provide you with a better browsing experience. If you click on 'Accept' or continue browsing this site we consider that you accept our cookie policy. ACCEPT