Hobbiebrunken v. United States Department of Agriculture et al
MEMORANDUM AND ORDER. The court rejects plaintiffs' contentions that RMA's decisions are arbitrary, capricious or contrary to substantial evidence. The clerk is directed to enter judgment in favor of defendants in all three related cases. SEE ORDER FOR DETAILS. Signed by District Judge Monti L. Belot on 1/8/2013. (alm)
IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF KANSAS
TOM VILSACK, SECRETARY OF
THE UNITED STATES DEPARTMENT
OF AGRICULTURE, et al.,
MEMORANDUM AND ORDER
Plaintiffs1 filed actions against defendants seeking judicial
review of an agency action pursuant to 5 U.S.C. § 1501, et seq.
Plaintiffs farmed land in Morton County, Kansas in 2009.
Management Agency (RMA) of the U.S. Department of Agriculture (USDA),
and the Federal Crop Insurance Corporation (FCIC).
this action seeking a court order overturning RMA’s Good Farming
Practices determinations for plaintiffs’ 2009 dryland corn crop.
court has reviewed the briefs submitted by the parties and the
Hobbiebrunken’s sons. Plaintiffs have filed three separate actions
which have been consolidated for discovery purposes. The undersigned
judge was assigned all three cases after it was determined that the
issues on review are very similar. Any factual differences in the
cases will be noted throughout the opinion.
Case No. 11-1385-MLB, Docs. 21, 24, 27, 30; Case No. 11-1386MLB, Docs. 23, 26, 29, 31; Case No. 11-1387-MLB, Docs. 16, 19, 22, 25.
Plaintiffs bring this action pursuant to 7 U.S.C. § 1501 et seq.,
known as the Federal Crop Insurance Act (FCIA). The FCIC is an agency
of the USDA and the RMA performs certain duties on its behalf.
C.F.R. part 400 contains the regulations implementing the FCIA, which
includes the agencies’ roles in crop insurance.
and the majority of crop insurance policies are sold to and serviced
by private sector Approved Insurance Providers (AIPs) who have entered
into a Standard Reinsurance Agreement (SRA) with the FCIC which
provides reinsurance to the AIPs.
The crop insurance contract is entered into between the AIP and
the producer after an application is submitted specifying the crop and
land that has been designated as insurable.
There are two types of
obtained revenue-based insurance for dryland (non-irrigated) corn in
Morton County, Kansas for crop year 2009.
This type of policy has a
The FCIA provides that coverage “shall not cover losses due to
. . . the failure of the producer to follow good farming practices,
7 U.S.C. § 1508(a)(3)(A)(iii).
The regulations define
“good farming practices” as follows:
The production methods utilized to produce the insured crop
and allow it to make normal progress toward maturity and
produce at least the yield used to determine the production
guarantee or amount of insurance, which are: (1) For
conventional or sustainable farming practices, those
generally recognized by agricultural experts for the
area . . . [The AIP] may, or [the insured] may request [the
AIP] to, contact FCIC to determine whether or not
production methods will be considered to be “good farming
7 C.F.R. § 457.8.
Facts and Procedural History
Plaintiffs rented land approximately 10 miles north of Elkhart,
Kansas, from Steven Miller for crop year 2009.
the very southwest corner of Kansas.
producers in Kansas.
Elkhart is located in
Plaintiffs were first year
Brian and Kevin were first year farmers.
Michael, Kevin and Brian farmed approximately 1807, 1809 and 1758
Together, plaintiffs planted 5375 acres of
Plaintiffs obtained insurance policies from AIP Argo National
Enterprise Unit (EU) option to insure the crop, which is defined in
the policy as a “unit that consists of all insurable planted acreage
of the insured crop in the county in which [the named insured has] a
share on the date coverage begins for the crop year.”
R. at 47.
Plaintiffs planted different seed varieties on their land between May
16 and June 2, 2009.
The seed was then sprayed with weed control
applications on various dates.
Michael sprayed the majority of his
land in late May, within days of the planting, with the exception on
one section which was sprayed in early July.
Both Brian and Kevin
sprayed their land in late June and early July.
On June 13, 2009, the area was hit by a moderate to severe hail
The corn was in different growing stages depending on the
At the time of the storm, plaintiffs were prepared to
fertilize the crop with nitrogen but did not do so.
believed that the crop had a poor stand after the hail and drought
On July 20, after waiting to see if the corn would recover after
the hail storm, plaintiffs filed a Notice of Loss with AIP Argo
National, claiming drought and hail as the cause of loss.
of their claims, plaintiffs submitted letters, pictures, evidence of
a hail storm on June 13, seed information, weather data, and invoices
and records for weed control applications.
Plaintiffs’ records were
not individualized; i.e. all seed was purchased by Michael and the
spray records were in Michael’s name.
Kevin submitted weather data
from Kansas State University indicating that Elkart received 4.55
Richfield 10 WSW received 4.83 inches of precipitation between January
1 through June 30, 2009.
3.53 inches of precipitation fell in July
Total precipitation showed either 8.08 or 8.36 inches of
Drought Monitor Archives for Kansas reflect that Morton
County was either “Normal” or Abnormally Dry” during the weeks of
April 7 through July 14. “Abnormally Dry” is not a drought condition,
but is the moisture condition closest to “Normal,” and is the mildest
of the five condition levels in moisture monitoring.
On July 21, the Farms Service Agency (FSA) took photographs of
AIP Argo National visited plaintiffs’ fields on
August 24 and 25 and took photographs.
Argo National concluded that
the hail storm which passed through Morton County on June 13 had a
high probability of hailing on plaintiffs’ fields.
On February 23, 2010, Argo National wrote to the Topeka Regional
determination” regarding farming practices employed by plaintiffs
addresses GFP determinations and provides guidance regarding how GFP
determinations are to be requested and made.
The GFP Bulletin states
that if the AIP cannot make a decision regarding GFP based on
available information, the AIP then may request in writing that the
RMA Regional Office make the GFP determination.
The GFP Bulletin provides that the GFP determination is based on
1. The agronomic situation of the producer, which includes
material facts about the production methods that were used
or will be used to produce the crop as well as weather and
climate factors, pest or disease risks, etc. that affect
the crop; and
2. The opinion from at least one agricultural expert . . .
3. Whether the production method used by the producer will:
a. Allow the insured crop to make normal progress
b. Produce at least the yield used to determine the
production guarantee or amount of insurance, including any
adjustments for late planted acreage;
c. Not reduce or adversely affect the yield; and
d. Be generally recognized for the area . . . .
R. at 758-759.
A production method that does not meet the standards
set forth in the GFP Bulletin is not considered an approved GFP.
On May 28, 2010, the TRO issued its GFP determinations.
found that plaintiffs failed to establish that they determined soil
fertility or failed to carry out an adequate fertility plan, failed
to implement adequate weed control, and failed to plant an appropriate
seed selection. The TRO decisions listed 28 supporting exhibits cited
in the determination letter and 29 exhibits which were reviewed but
Plaintiffs requested reconsideration of the decisions by
the RMA Deputy Administrator for Insurance Services in Washington,
Plaintiffs submitted a brief and included a report from Dr.
Daniel Krieg, a crop physiologist.
determinations of GFP.
On December 10, the decision was
There is no evidence in the record that
plaintiffs’ 2009 losses have been determined to be the result of their
failure to follow good farming practices.4
III. Review of Agency Decision
Under the Administrative Procedure Act, 5 U.S.C. § 706, the court
may set aside an agency’s action if it is “arbitrary, capricious, an
abuse of discretion, or otherwise not in accordance with law.”
Citizens’ Comm. to Save Our Canyons v. Krueger, 513 F.3d 1169, 1176
(10th Cir. 2008).
“The duty of a court reviewing agency action under
the ‘arbitrary or capricious' standard is to ascertain whether the
connection between the facts found and the decision made.”
Furthermore, the court must “determine whether the agency considered
all relevant factors and whether there has been a clear error of
“A presumption of validity attaches to the agency
The administrative record in this case is 2685 pages long.
The reconsideration letters issued by the RMA implies that the
AIP will assess an amount for plaintiffs’ failure to follow GFP. R.
at 36. The policy provides that no coverage is allowed if the loss
was caused by the failure to follow good farming practices. R. at 54.
The record does not include a final determination on plaintiffs’
claims. Presumably, this appeal halts the claims process as the GFP
determination would have an impact on the actual loss determination
by the AIP.
action and the burden of proof rests with the appellants who challenge
Id. (quoting Colo. Health Care Ass'n v. Colo. Dep't of
Soc. Serv., 842 F.2d 1158, 1164 (10th Cir. 1988)).
Consideration of the Record
Plaintiffs contend that RMA’s decisions failed to consider the
drought conditions that plaintiffs assert caused their crop losses.
According to plaintiffs, the lack of rain, heat and wind, and the hail
storm all “played into the big picture.”
Br. at 10.
to provisions in the Loss Adjustment Manual (LAM) and contend that RMA
failed to consider its provisions when deciding plaintiffs’ claims.
Reply Br. at 2-3.
Plaintiffs specifically assert that RMA failed to follow certain
provisions in section 2 of the LAM which discusses uninsured causes of
G When loss is due to uninsurable cause(s):
(1) Consider production on same or similar crop(s) on
other farms in the area, if available.
(2) Verify cause of loss (e.g. apparent loss may be
poor weed control; however, the damage may have been
indirectly caused by insufficient rainfall to activate a
properly applied herbicide).
(5) Determine efforts to prevent or control the
situation (chemical used and/or methods followed). Record
the number of applications and dates they were applied based
on receipts or other third party records.
(6) Determine efforts neighbors and others in the
community used to prevent or control the same situation.
(7) Photograph the evidence of the crop in question and
surrounding farms, with identifying landmarks in each
R. at 1476-77.
Defendants respond that the LAM provides procedures for the AIP
to determine a loss and that RMA is not required to determine a cause
The LAM states that the “AIP is responsible for all loss
adjustment responsibilities outlined in [the LAM].”
R. at 1158.
Furthermore, the GFP determinations issued by RMA specifically state
that the GFP process does not include whether or not an insured cause
of loss was present.
R. at 6.
Plaintiffs have not provided any
authority for their position that RMA was required to follow section
2 of the LAM when making a GFP determination.
Therefore, the failure
to follow the provisions in the LAM was not arbitrary and capricious.
determination must consider the agronomic situation of the producer,
including weather and climate.
R. at 758.
The court finds that RMA’s
decisions did consider the weather conditions.
RMA’s decisions list
all the documents that were considered by the agency, including
weather records submitted by plaintiffs, plaintiffs’ expert opinion
and plaintiffs’ briefs.
Moreover, the reconsideration decisions set
forth the weather information in the body of each decision and
repeatedly reference the weather.
R. at 19, 6, 7, 8, 9, 10, 11, 13.
The administrative record clearly shows that plaintiffs’ claims were
based on drought and hail.
The weather claims were not ignored.
The court finds that RMA’s decisions considered the weather
conditions but found that plaintiffs did not utilize good farming
practices regardless of those weather conditions.
Support for the Agency’s Conclusions
Next, plaintiffs contend that the three failures listed by the
agency were not supported in the record.
appropriate seed selection as follows:
According to the documentation, you selected hybrids
based on cost and did not provide supporting documentation
for the seeding rate you planted, the selection of a medium
maturity hybrid, that you planted at the end of the final
planting period, or documentation that you used a hybrid
suitable for grain production on dryland in southwest
You were aware of the growing conditions at the time
and were beginning to plant in the final 15 days of the
final planting date, May 31, 2009, for Morton County,
Exhibit A.3. Other than economics, you provided no
information that would support your decision to select the
corn hybrids you planted rather than the hybrids recommended
by your consultant. The corn hybrids you selected had not
been tested for dryland production in southwest Kansas.
R. at 35-36, 1914, 1937-38.
Plaintiffs assert that the seed they selected was adequate
because the results of the germination test were in the 93-95% range
and Dr. Krieg, their expert, stated that all the hybrid seed met
requirements of federal and state law.
Plaintiffs argue that RMA’s
decisions that plaintiffs failed to plan an appropriate seed selection
was not supported by any evidence.
Plaintiffs purchased a variety of seed.
The seed type and its
characteristics are set forth in RMA’s decisions, which clearly state
R. at 8-9, 15-18, 1903, 1905-06, 1912-14, 1921-22, 1928-29,
Notably, RMA found that plaintiffs’ crop consultant, Carl
Speck, recommended 99 and 108 day corn early maturity hybrids from NK
Plaintiffs did not follow his recommendation.
plaintiffs purchased medium maturity hybrids which averaged 110-118
days and which had not been tested in southwest Kansas.
RMA cited the K-State Corn Production Handbook (handbook) which
successful corn production.”
R. at 35.
The handbook further stated
that “poorly adapted hybrids may yield 50 or more bushels per acre
less than the best hybrids.”
R. at 211.
Plaintiffs’ expert noted
adaptation to a particular environment.”
R. at 34.
however, choose a seed with a longer maturity date even though they
planted at the end of the planting season.
doing so was economics.
Plaintiffs sole reason for
As noted by RMA, economics are not a valid
justification in determining if a production method was a GFP.
On review, plaintiffs do not offer any evidence that was not
considered by RMA.
Plaintiffs also have no evidence to refute any
findings made by RMA.
The court finds that there is substantial
evidence to conclude that plaintiffs failed to employ good farming
practices when they did not utilize an appropriate seed selection.
Hoyl v. Babbitt, 129 F.3d 1377, 1383 (10th Cir. 1997)(“evidence is
generally substantial under the APA if it is enough to justify, if the
trial were to a jury, refusal to direct a verdict on a factual
Failure to Determine Soil Fertility or Carry out an Adequate
Plaintiffs assert that RMA erroneously concluded that they did
not test the soil and the lack of an application of fertilizer showed
that plaintiffs failed to use good farming practices.
With respect to the soil testing, plaintiffs assert that they did
in fact test the soil contrary to the findings by RMA.
In support of
this conclusion, plaintiffs cite to Dr. Krieg’s opinion which states
that Speck collected soil samples and had them tested.
Br. at 14.
Plaintiffs, however, failed to offer any evidence that this ever
The only soil samples submitted to RMA were those that were
taken in December 2009. Plaintiffs argue, without any authority, that
the nutrients in the soil in December 2009 were present in the soil
prior to planting the corn in May.
The handbook states that the “most reliable means of determining
fertilizer need is by soil testing regularly with continual support
from other methods listed.”
R. at 27.
Plaintiffs have not provided
any evidence that they took any steps to determine the fertility of
the soil prior to planting. Plaintiffs’ argument is not sufficient to
support a finding that RMA’s decision was arbitrary and capricious.
Plaintiffs next assert that RMA ignored the fact that plaintiffs
were prepared to apply fertilizer but did not do so because the hail
had damaged their crops.
RMA did not ignore plaintiffs’ position.
TRO RMA noted that the evidence submitted by plaintiffs was not clear
and there was no documentation to indicate the purchase or application
On appeal, RMA found that plaintiffs had a duty,
pursuant to the insurance contract, to protect their crop.
that the duty to protect the crop required plaintiffs to apply
fertilizer prior to July 20, the date of the claim.
The recommended nitrogen algorithm in the handbook provides that
40 pounds of nitrogen per acre are recommended to achieve the goal of
39 bushels per acre.
R. at 27, 219.
Dr. Krieg agreed with this
The handbook states that nitrogen may be applied before
planting, at planting, and/or as a sidedressing after corn is up.
The handbook states that nitrogen uptake by corn is about 25
days after emergence and that the applications should be made early.
R. at 219.
Plaintiffs planted their corn between mid and late May.
The hail storm came on June 13.
Plaintiffs did not apply nitrogen to
RMA determined that the failure to apply fertilizer was not a
good farming practice.
RMA referenced the insurance contract which
requires plaintiffs to provide sufficient care in the event of damage
to the crop and further stated that plaintiffs should have immediately
submitted a claim if they believed that there was hail damage.
Plaintiffs argue that RMA did not know the condition of the corn
and that Michael’s verified statement regarding the corn’s condition
is sufficient to find that the corn was damaged and fertilizer should
not be applied.
Plaintiffs have the burden to show that RMA’s
arbitrary and capricious.
RMA or the AIP had no knowledge of any
potential damage to the crop in June 2009.
RMA’s determination that
plaintiffs had a duty to protect their crop and report a loss
immediately is also not arbitrary and capricious.
The court finds that there is substantial evidence to conclude
that plaintiffs failed to employ good farming practices when they did
not determine soil fertility or carry out a fertility plan.
Lack of Herbicide
On some photos, it is difficult to distinguish where the
stands of corn were located.
Plaintiffs’ crop consultant, Speck,
recommended a weed control program that would specifically address the
Speck acknowledged that his recommendation was
Plaintiffs did not follow Speck’s recommendation but
choose a cheaper alternative and did not purchase the herbicide which
Plaintiffs also only applied the herbicide on one
Kevin and Brian sprayed their crop on various dates which
ranged from 24 to 39 days after planting.
Michael sprayed the
majority of his crop a few days after planting, with the exception of
one section which was sprayed 34 days after planting.
With respect to all plaintiffs, RMA determined that they had not
application of herbicide, failed to provide documentation to support
their weed control program and did not provide enough information to
support the conclusion that the environmental conditions were extreme
enough to render the herbicides ineffective.
On review, plaintiffs
contend that the agency failed to consider that the fields were tilled
with a Sunflower 3300 Blade plow and that the hail and drought
conditions affected the herbicide.
After a review of the RMA decisions, the court finds that the
agency did consider plaintiffs’ use of the plow.
RMA considered the
Argo letter which discussed the plow and plaintiffs’ position that the
plow was used to expose the weeds.
In addition, Argo attached a video
demonstrating the plow.
Nevertheless, RMA determined that plaintiffs
should have made subsequent applications of herbicide to the crop.
The photos show that the crop was overrun by weeds and that further
action was necessary to control those weeds.
RMA determined that plaintiffs’ single application of herbicide
was a failure to utilize good farming practices. Plaintiffs’ argument
concerning this determination is that the drought conditions would not
have permitted a subsequent application of herbicide to be effective.
In its opinion, RMA cited the weather conditions in Elkhart, Kansas,
during the time of planting and application.
RMA cited the rainfall
precipitation during the application period was 1.92 inches.
RMA found that the weather conditions were not extreme enough
to render the application of herbicides ineffective.
not presented any evidence to rebut this conclusion by RMA.
Plaintiffs also failed to establish a herbicide plan for their
Apparently, plaintiffs had no intention of applying any more
herbicide to their crop.
used on their crop.
RMA reviewed the products which plaintiffs
Two herbicides used by plaintiffs both stated
that repeat treatments may be necessary.
R. at 1910.
the handbook states that corn is vulnerable to weed competition in the
first four weeks and that in most fields weed pressure is too high for
one application to be adequate.
R. at 30, 1909, 1932.
determinations and did not provide RMA with any evidence that one
application of their herbicide was sufficient.
After a review of
RMA’s decision, the court finds that RMA’s decision was supported by
Failure to Timely Respond
Finally, plaintiffs contend that the agency had a duty to make a
timely investigation and inform them of their duty to continue to care
for the crop. Plaintiffs, however, cite no provision to support their
position that the agency has a duty to respond to a claim.
the entity that investigates and services the claims.
The AIP is
are set forth in the record and they do not include an initial
investigation into a claim.
Moreover, plaintiffs’ policy explicitly
states that plaintiffs must protect the crop from further damage by
providing sufficient care.
R. at 55.
Therefore, RMA did not have a duty to respond to plaintiffs’
initial claim made to the AIP.
For the above-stated reasons, the court rejects plaintiffs’
contentions that RMA’s decisions are arbitrary, capricious or contrary
to substantial evidence.
The clerk is directed to enter judgment in favor of defendants in
all three related cases.
A motion for reconsideration of this order is not encouraged.
The standards governing motions to reconsider are well established.
Comeau v. Rupp, 810 F. Supp. 1172 (D. Kan. 1992).
Any such motion
shall not exceed three pages and shall strictly comply with the
standards enunciated by this court in Comeau v. Rupp.
The response to
any motion for reconsideration shall not exceed three pages. No reply
shall be filed.
IT IS SO ORDERED.
day of January 2013, at Wichita, Kansas.
s/ Monti Belot
Monti L. Belot
UNITED STATES DISTRICT JUDGE