Save More of Gary, Inc. v. United States, 18374.
| Decision Date | 21 June 1971 |
| Docket Number | No. 18374.,18374. |
| Citation | 442 F.2d 36 |
| Parties | SAVE MORE OF GARY, INC., Plaintiff-Appellant, v. UNITED STATES of America, Defendant-Appellee. |
| Court | U.S. Court of Appeals — Seventh Circuit |
Sidney M. Libit, Libit, Lindauer & Henry, Chicago, Ill., for plaintiff-appellant; Robert M. Gray, Chicago, Ill., of counsel.
Alan S. Rosenthal, James C. Hair, Attys., Dept. of Justice, Washington, D. C., William C. Lee, U. S. Atty., Fort Wayne, Ind., William D. Ruckelshaus, Asst. Atty. Gen., Alfred W. Moellering, U. S. Atty., Washington, D. C., for defendant-appellee.
Before SWYGERT, Chief Judge, KNOCH, Senior Circuit Judge and KERNER, Circuit Judge.
Plaintiff-appellant, Save More of Gary, Inc., filed its complaint in the United States District Court for judicial review of administrative action taken by the Department of Agriculture disqualifying plaintiff from participation in the Food Stamp Program for 30 days as a consequence of a finding that plaintiff had violated certain provisions of the Food Stamp Act of 1964 and Food Stamp Regulations.
Plaintiff now appeals from the District Court's grant of the government's motion for summary judgment, 309 F. Supp. 39.
The Act, Title 7 U.S.C. § 2011 et seq., authorizes the Secretary of Agriculture to formulate and administer a food stamp program under which eligible households are issued coupons which are to be used solely to purchase food from retail food stores which have been approved for participation in the program, § 2013(a). Section 2012(b) defines food for purposes of the act as excluding alcoholic beverages, tobacco, foods identified on the package as imported, and meat and meat products which are in fact imported.
Pursuant to the Act, the Secretary has issued regulations which require, 7 C.F.R. Part 1602.2(b), that coupons be accepted by authorized retail food stores only in exchange for eligible foods. That same section provides that acceptance of coupons for meat or meat products which are labeled, or which can be identified, as imported when delivered to the retail store or to a central warehouse, distribution or meat fabricating facility operated by the food retailer shall be deemed accepted with knowledge of such importation. Other food products clearly identified on the package as imported are not to be exchanged for coupons.
In addition change is to be made in uncanceled and unendorsed coupons valued at 50¢ previously accepted for eligible foods. If change in an amount of less than 50¢ is required, the customer at his choice may pay the difference in cash or receive credit in that amount for future purchases, 7 C.F.R. 1602.2(d). While this appeal was pending, plaintiff filed as additional authority a letter from the Regional Director, U. S. Department of Agriculture, Food and Nutrition Service for the Midwest Regional Office at Chicago, announcing issuance of new $5 coupons in addition to the continuing $2 and 50¢ coupons and a change in regulations whereby a customer may be given change in cash in amounts up to and including 49¢.
In oral argument plaintiff contends that this new notice underlined the difficulties of merchants dealing with the program and made possible some of the very transactions for which plaintiff was being penalized, e. g., the customer who now received 49¢ in cash could use that to buy ineligible non-food items.
Violators of the Act or regulations may be disqualified for further participation. The regulations provide for opportunity to submit information, explanation or evidence concerning alleged non-compliance prior to final determination by the Consumer and Marketing Service of the Department of Agriculture, which initiates the proceedings with a letter specifying the charges. This letter, the response of the recipient, plus any other information available is considered by the Director, Food Stamp Division, who then makes his determination, 7 U.S.C. § 2020, 7 C.F.R. 1602.6. There is provision for a review by the Food Stamp Review Officer, 7 C.F.R. 1603.2, at which a personal appearance may be had and further written data may be submitted.
Section 13 of the Act (7 U.S.C. § 2022) provides for a trial de novo in the District Court to determine the validity of the questioned administrative action.
It is plaintiff's position that the District Court erred in concluding that the Department followed a regular procedure which complied with the law, that its findings were supported by substantial evidence, that its penalty was not unduly harsh and that issues raised by plaintiff were immaterial and did not operate in mitigation.
The defendant's motion for summary judgment was supported by an abundance of documentary material including affidavits, contemporary reports, letters and memoranda in addition to depositions.
Plaintiff's application to participate in the program, signed by its president, states that he had read and understood listed pertinent regulations which were included in material given him at a retailer education meeting, of which he acknowledged receipt in writing. The application stated that he understood authorization might be revoked for violation of these regulations.
In the course of several visits Food Stamp Program representatives observed certain violations which were explained to plaintiff's officers and employees at the time and followed up in written notices.
In February 1967, the Department's Inspector General conducted an investigation for compliance which resulted in reports of deliveries of non-eligible items for food coupons and failures to give 50¢ coupons in change (offering only credit slips good solely in plaintiff's market for amounts in excess of 50¢). These incidents were described in the depositions.
On April 19, 1967, plaintiff's president was sent a letter giving him full details on each of these instances including the name of plaintiff's checker, the name and description of the individual items and the amounts involved.
Plaintiff's treasurer replied orally in person ...
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