Garcia v. Concannon, 94-35457

Citation67 F.3d 256
Decision Date04 October 1995
Docket NumberNo. 94-35457,94-35457
Parties95 Cal. Daily Op. Serv. 7768, 95 Daily Journal D.A.R. 13,341 Yvonne GARCIA and Kathleen Zellar, Plaintiffs-Appellants, v. Kevin W. CONCANNON, Director of the Oregon Department of Human Resources, in his official capacity; and Mike Espy, Secretary of United States Department of Agriculture, Defendants-Appellees.
CourtUnited States Courts of Appeals. United States Court of Appeals (9th Circuit)

James F. Young, Oregon Legal Services, Coos Bay Oregon Legal Service, Coos Bay, OR, and Karen A. Berkowitz, Multnomah County Legal Aid Services, Portland, OR, for plaintiffs-appellants.

Janis C. Kestenbaum, United States Department of Justice, Washington, DC, for defendant-appellee Mike Espy.

Jas. J. Adams, Assistant Attorney General, Salem, OR, for defendant-appellee Concannon.

Appeal from the United States District Court for the District of Oregon.


SCHROEDER, Circuit Judge:

This litigation concerns the validity of regulations promulgated by the Secretary of the United States Department of Agriculture, and the Director of the Oregon Department of Human Resources, to implement the anti-fraud provisions of the Food Stamp Act, 7 U.S.C. Sec. 2015. The statute provides that any person found guilty of violating the Food Stamp Act "shall, immediately upon the rendering of such determination, become ineligible for further participation in the program" for a fixed disqualification period that increases in duration with each subsequent offense. 1

The regulations promulgated by the Secretary of Agriculture, however, do not impose the disqualification period "immediately" after a determination of a violation, if the violator is (1) not currently participating in the Program or (2) already otherwise ineligible for Program benefits. Rather, the regulations defer the disqualification period for such violator until the violator later reapplies for benefits and is found eligible for them. The section addressing nonparticipants is 7 CFR Sec. 273.16(a)(1):

The disqualification period for nonparticipants at the time of the administrative disqualification or court decision shall be deferred until the individual applies for and is determined eligible for Program benefits.

(emphasis added).

Corollary provisions for otherwise ineligible violators are delineated in 7 CFR Secs. 273.16(e)(8)(iii), (f)(2)(iii), & (g)(2)(ii), which all contain the following language:

If the individual is not eligible for the Program at the time the disqualification period is to begin, the period shall be postponed until the individual applies for and is determined eligible for benefits.

(emphasis added).

Oregon Administrative Rules are substantially identical. 2

Plaintiffs in this case, Yvonne Garcia and Kathleen Zellar, were both found to have violated the food stamp laws at a time when they were not otherwise eligible for any benefits. Years later they reapplied for benefits and were determined to be eligible, but were told that they still had to serve their six-month ineligibility period before benefits would be reinstated.

The district court found that the language of the regulations conflicted with the language of the statute. In this respect, the district court was clearly correct. The statute requires that the period of ineligibility begin "immediately" upon a determination of violation, while the regulations provide for "deferral" and "postponement."

The district court nevertheless concluded that the language of the anti-fraud provisions of the Food Stamp Act did not comport with Congress' true intent, whereas the Department of Agriculture's regulations did. Thus, the district court upheld the regulations and dismissed plaintiffs' Sec. 1983 action for failure to state a claim. See Columbia Pictures v. Professional Real Estate Inv., 866 F.2d 278, 280 n. 4 (9th Cir.1989), aff'd, --- U.S. ----, 113 S.Ct. 1920, 123 L.Ed.2d 611 (1993) (stating that the plain language of a statute is dispositive unless, inter alia, there is clearly a contrary legislative intent).

In so doing, the district court determined that the Congressional intent behind the Food Stamp Act's anti-fraud provisions was to "deter illegal food stamp activity." Because Garcia and Zellar would not actually have been deprived of any benefits had the disqualification period run "immediately" from the determination of violation, the district court concluded that an immediate imposition of the disqualification period would not have resulted in a meaningful penalty. The district court found that by contrast, deferring the imposition of the disqualification period would maximize the penalty Garcia and Zellar suffered, better serving Congress' goal of deterring further abuses.

We believe that the district court took a needlessly narrow view of Congress' intent. The operative language of the anti-fraud provision, imposing disqualification "immediately," was enacted in 1977. At that time, Congress expressly stated, in accompanying reports, that its purpose included simplification of administration as well as deterrence. H.R.Rep. No. 95-464, P.2 (1977), U.S.Code Cong. & Admin.News 1977 at 1978.

The Department of Agriculture's regulations are not consistent with the purpose of simplifying administration. If the disqualification period starts to run immediately, then the Food Stamp Program administrators need not concern themselves with the violator for the length of the penalty. But, if disqualification is deferred until the violator is found eligible--as the regulations provide--and the violator wants to serve the disability period as soon as possible, then the violator must keep reapplying for benefits on a regular basis until the violator is found eligible. Then, if the Program administration eventually deems the violator eligible (so that the disqualification period begins) the Program administration still must reassess the violator's eligibility after the disqualification period.

Moreover, to the extent that Congress wanted to deter abuses, the plain language of the anti-fraud provisions provides a sound mechanism for realizing Congress' vision; deterrence is most successful if punishment is prompt. See C. Torcia, Wharton's Criminal Law, Vol. 1, 16-17 (15th Ed.1993). Indeed, Congress said that the "increased use of administrative disqualifications should serve to deter program abuse as it is perceived that such abuses will be swiftly determined and punished." S.Rep. No. 97-139, P. 65 (1981) U.S.Code Cong. & Admin.News 1981 at 455. Similarly, the anti-fraud provisions state that "such periods of ineligibility shall remain in effect, without possibility of administrative stay...." 7 U.S.C. Sec. 2015(b)(3). In sum, deferring punishment is contrary to the congressional intent to achieve deterrence through swift punishment.

Further, a period of immediate, mandatory disqualification serves as a real deterrent for a person who considers committing fraud, but who does not know what the next six months might bring in terms of eligibility. When analyzing whether a statutory scheme will achieve deterrence, the relevant question is not (as the district court intonates) how much punishment violators will actually suffer after committing fraud, but rather what punishment potential violators will consider when deciding whether to commit fraud. While hindsight reveals that immediate imposition of disqualification would not have actually deprived Garcia or Zellar of any benefits, Garcia and Zellar had no way of knowing this when they decided to commit fraud. From Garcia and Zellar's perspective, disqualification was thus a meaningful threat.

Additionally, the disqualification period counts as a "strike" against Garcia and Zellar. Since the...

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2 cases
  • Thomas v. North Carolina Dept. of Human Resources
    • United States
    • Court of Appeal of North Carolina (US)
    • December 17, 1996
    ...I, however, that this standard of federal deference did not bar our review of the suspect regulation there. See Garcia v. Concannon, 67 F.3d 256, 259 (9th Cir.1995). We recognized that judicial deference is inappropriate where the challenged regulation "alters the clearly expressed intent o......
  • Devi v. Senior and Disabled Services Div.
    • United States
    • Court of Appeals of Oregon
    • November 8, 1995
    ...benefits in the first place. In such cases, SDSD argues, the penalty would not have its intended deterrent effect. In Garcia v. Concannon, 67 F.3d 256 (9th Cir.1995), the Court of Appeals for the Ninth Circuit rejected the very same arguments SDSD proposes in this case. In that case, the pl......

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