Julian v. Rigney, Case No. 4:13-cv-00054

CourtUnited States District Courts. 4th Circuit. United States District Court (Western District of Virginia)
Writing for the CourtJackson L. Kiser
Docket NumberCase No. 4:13-cv-00054
PartiesCHRISTOPHER B. JULIAN, ET AL., Plaintiffs, v. JAMES RIGNEY, ET AL., Defendants.
Decision Date24 March 2014

CHRISTOPHER B. JULIAN, ET AL., Plaintiffs,
v.
JAMES RIGNEY, ET AL., Defendants.

Case No. 4:13-cv-00054

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF VIRGINIA DANVILLE DIVISION

Entered: March 24, 2014


MEMORANDUM OPINION

By: Jackson L. Kiser
Senior United States District Judge

Plaintiffs Christopher B. Julian and Renee G. Julian ("Plaintiffs") applied for and were denied a Farm Ownership loan through the Farm Service Agency ("FSA") of the U.S. Department of Agriculture ("USDA"). As a result of the denial, Plaintiffs, proceeding pro se and in forma pauperis, filed suit in this Court against the USDA, seven federal employees, and one state employee. On October 18, 2013, state employee Wanda Johnson filed a Motion to Dismiss [ECF No. 16]. Plaintiffs filed a Motion for Partial Summary Judgment on January 6, 2014 [ECF No. 27], and the remaining Federal Defendants collectively filed a Motion to Dismiss on January 14, 2014 [ECF No. 28]. Each of the three dispositive motions was met with an appropriate written response, and was followed by a reply brief.

On February 25, 2014, I heard oral arguments from all sides, outlining their respective positions on the facts, law, and agency record before the Court. Having thoroughly reviewed the record and arguments of counsel, the matter is now ripe for decision. For the reasons stated below, I will GRANT Defendant Johnson's Motion to Dismiss, DENY Plaintiffs' Motion for Partial Summary Judgment, and GRANT IN PART and DENY IN PART Federal Defendants' Motion to Dismiss. Specifically, I will DENY Federal Defendants' Motion to Dismiss with respect to Plaintiffs' request for judicial review of the final agency decision, and GRANT the

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Motion with respect to all other claims against the USDA, and all claims against the following employee-defendants, in any capacity: (1) James Rigney; (2) Ronald Kraszewski; (3) J. Calvin Parrish; (4) Jerry L. King; (5) Roger Klurfeld; (6) Christopher P. Beyerhelm; and (7) Barbara McLean. The USDA will remain as the sole defendant, and the suit will proceed as an action for judicial review of the final decision of USDA National Appeals Division Director Roger Klurfeld.

STATEMENT OF FACTS AND PROCEDURAL HISTORY

On October 10, 2012, Plaintiffs Christopher B. Julian and Renee G. Julian applied for a Farm Ownership ("FO") loan through the Farm Service Agency ("FSA") of the U.S. Department of Agriculture ("USDA"). (Compl. Ex. A, at 1 [ECF No. 3].) The FSA, acting through Farm Loan Officer James Rigney, issued a Notice of Complete Application on November 21, 2012, informing Plaintiffs that their application was deemed complete as of November 19, 2012.1 (Id. Ex. D, at 3.) On November 28, 2012, FSA Farm Loan Manager Ronald Kraszewski issued a letter informing Plaintiffs that their loan application was denied. (Id. Ex. A.) In the letter, the FSA explained that Plaintiffs' proposed use of loan funds was not authorized for the type of loan requested,2 and notified Plaintiffs of their rights to appeal. (Id. Ex. A, at 1-3.) Plaintiffs were

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informed that they may: (1) request reconsideration by the Farm Loan Manager; (2) request mediation through the Virginia state mediation program, as part of the FSA's informal appeals process; or (3) appeal the determination to the National Appeals Division ("NAD") of the USDA. (Id. Ex. A, at 2-3.)

On December 10, 2012, Plaintiffs requested mediation via a letter to the Virginia Agricultural Mediation Program ("VAMP") with Virginia State University. (Id. Ex. F.) VAMP Project Director Wanda Johnson informed Plaintiffs, in an email dated January 10, 2013, that their request was timely, and indicated that she would "be in touch with [Plaintiffs] probably tomorrow regarding the mediation." (Id. Ex. C.) Unbeknownst to Plaintiffs, however, the USDA had revoked its certification of the Virginia state mediation program as of October 2012. (Id. at 6; Ex. C.) It remains unclear precisely how and when officers of the FSA, or VAMP itself, learned of the USDA revocation.3

Plaintiffs claim that they made several attempts to contact VAMP Project Director Johnson and "USDA et al" regarding mediation. (Id. at 6.) On January 24, 2013, Plaintiffs allege that they contacted the FSA through an online assistance system, and first became aware of the loss of certification in a subsequent email exchange. (Id. at 6; Ex. G, at 1.) Following this exchange, Plaintiffs received a letter from FSA State Executive Director J. Calvin Parrish that was dated January 24, 2013. (Id. Ex. H.) The letter indicated that "[a]t this time, Virginia does

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not have a State Certified Mediation Program," and informed Plaintiffs that they would need to pay for half the cost of mediation if they choose to pursue it. (Id. Ex. H, at 1.) The letter included a list of registered mediators in Virginia.

In a letter dated February 5, 2013, Plaintiffs informed FSA State Executive Director Parrish that they had requested mediation through the North Carolina Agricultural Mediation Program ("NCAMP"). (Id. at 6-7; Ex. I.) Noting that they were asked to pay a credit report fee of $20.25 with their original loan application, Plaintiffs requested a copy of their credit reports. (Id. Ex. I.) In a letter dated February 8, 2013, FSA Farm Loan Officer Rigney provided Plaintiffs with a credit report; the report was also dated February 8, 2013. (Id. Ex. K.) As part of the NCAMP mediation process, Plaintiffs signed an agreement to mediate and a confidentiality statement, indicating that Plaintiffs would keep confidential any information learned during the mediation process. (Id. Ex. N.)

On approximately March 13, 2013, Plaintiffs made several Freedom of Information Act ("FOIA") requests through the FOIA Office of the FSA.4 (Id. at 11; Ex. W.) In a letter dated March 22, 2013, FSA State Executive Director Parrish responded with a number of documents that were responsive to Plaintiffs' request. (Id. Ex. W.)

In addition to requesting mediation, Plaintiffs appealed their loan denial to the USDA's National Appeals Division ("NAD"). (Id. Exs. Q, AE.) Plaintiffs' request for appeal was

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complete on March 4, 2013. (Id. Ex. Q, at 1.) During the prehearing, held on March 19, 2013, the FSA withdrew one of its justifications (that Plaintiffs were essentially trying to refinance an existing loan) as a reason for the loan denial. (Id. at 8; Ex. U, at 2.) As a result, NAD Hearing Officer Jerry L. King informed Plaintiffs that this issue would not be allowed as a point of discussion during the hearing. (Id. at 8.) Plaintiffs objected to this restriction in a letter to Hearing Officer King, dated March 22, 2013, and asserted their belief that the FSA had inappropriately accessed their credit reports on February 8, 2013. (Id. Ex. R.)

In a letter to Plaintiffs, dated March 28, 2013, Hearing Officer King declined to reconsider his ruling on the scope of the hearing, and laid out the core issues for discussion.5 (Id. Ex. U, at 2.) With respect to their credit report grievances, Hearing Officer King directed Plaintiffs to the USDA Office of Inspector General. (Id.) Noting that Plaintiffs had accused the FSA of prejudicial bias, he provided instructions for completing a USDA Program Discrimination Complaint Form with the USDA's Office of Adjudication. (Id. Ex. U, at 2-3.) Hearing Officer King conducted an in-person hearing of Plaintiffs' appeal on April 17, 2013, and issued his conclusion that the loan denial was not erroneous on May 16, 2013. (Id. Ex. AE, at 2, 5.) Plaintiffs subsequently requested a Director's Review of the NAD determination,6 and on

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July 24, 2013, NAD Director Roger Klurfeld issued a decision upholding the NAD Appeal Determination.7 (Id. Ex. AA.)

Plaintiffs, proceeding pro se and in forma pauperis, filed suit in this Court on September 16, 2013. (Id. at 1.) In addition to a request for judicial review of the final agency decision, Plaintiffs allege a denial of due process and a number of other tort claims, including negligence, fraud, fraudulent misrepresentation, conspiracy, racketeering, and violations of the Fair Credit Reporting Act. Plaintiffs name nine (9) defendants, including eight (8) federal agencies or employees (the U.S. Department of Agriculture; USDA FSA Loan Officer James Rigney; USDA FSA Loan Manager Ronald A. Kraszewski; USDA FSA Executive Director J. Calvin Parrish; USDA FSA Deputy Administrator for Farm Loan Programs Chris P. Beyerhelm; USDA FSA National FOIA/PA Specialist Barbara McLean; USDA NAD Hearing Officer Jerry L. King; and USDA NAD Director Roger Klurfeld) ("Federal Defendants"), and a single state employee, VAMP Project Director Wanda Johnson ("Defendant Johnson"). (Id. at 1-3.)

In addition to an ad damnum clause requesting approximately $14 million in damages (representing $1 million per month since January 1, 2013), Plaintiffs ask that $1 million be

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awarded to each of five other individuals who are not parties before the Court.8 (Id. at 21-22.) Plaintiffs request that "all settlement amounts be net of taxes," and seek refunds in the amount of $20.25 for a credit report and $350.00 for mediation costs, both compounded with interest at 24.99%. (Id. at 22-23.) Plaintiffs ask the Court to require the USDA to prosecute FSA Farm Loan Manager Ronald A. Kraszewski for perjury, and require "USDA et al" to...

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