Pelzer et al v. Department of Agriculture et al

Filing 41

ORDER if pltfs believe that the decision of the Agency to deny reconsideration was arbitrary or capricious, they must submit a brief explaining why, on or before 7/13/11; if such a brief is filed, the response will be due within 60 days thereafter. Signed by Chief Judge J. Leon Holmes on 6/22/11. (vjt)

IN THE UNITED STATES DISTRICT COURT
EASTERN DISTRICT OF ARKANSAS
WESTERN DIVISION
DAVID PELZER; DAVID AND RUTH
PELZER, LLC, an Iowa Limited Liability
Company; and DAVID AND MATTHEW
PELZER, LLC, an Iowa Limited Liability
Company
v.

PLAINTIFFS

No. 4:11CV00108 JLH

UNITED STATES DEPARTMENT OF
AGRICULTURE, FEDERAL CROP INSURANCE
CORPORATION, RISK MANAGEMENT AGENCY;
and ARMTECH INSURANCE SERVICES,
a Texas Corporation

DEFENDANTS

ORDER
The plaintiffs bring this action against the United States Department of Agriculture, Risk
Management Agency, and the Federal Crop Insurance Corporation (collectively, “the Agency”), as
well as Armtech Insurance Services, seeking to recover loss relating to 574.7 acres of corn planted
behind harvested wheat in 2007. The plaintiffs allege that they planted corn behind a harvested
wheat crop in reliance on representations made by agents of Armtech that the corn would be insured.
They further allege that the corn crop was lost due to insured causes but that Armtech denied the
claim. Pursuant to the applicable federal regulations, the plaintiffs filed timely requests for
reconsideration with the Agency, which were denied. The Common Crop Insurance Policy requires
that the production methods for an insured crop follow “good farming practices,” which means, for
conventional farming practices, “those generally recognized by experts in the area.” In denying the
requests for reconsideration, the Agency determined that the planting of non-irrigated corn following
wheat is not a generally recognized production method for the area. The plaintiffs seek judicial

review of the Agency decision denying their requests for reconsideration pursuant to 7 U.S.C.
§ 1508(j) and 7 C.F.R. § 400.98. The regulation provides that a “reconsideration decision by the
Agency regarding good farming practices shall not be reversed or modified as a result of judicial
review unless the reconsideration decision is found to be arbitrary or capricious.” 7 C.F.R.
§ 400.98(f). In the alternative, the plaintiffs seek to recover from Armtech for negligence, deceit,
constructive fraud, reformation, and deceptive trade practices.
The parties stipulated that a judicial review of the Agency decision pursuant to 7 U.S.C.
§ 1508(j) and 7 C.F.R. § 400.98 should be completed by the Court before the action can go to trial
on the claims against Armtech. The parties stipulated to a date by which the administrative record
would be filed, as well as dates on which briefs would be filed. The Court entered a scheduling
order according to that stipulation. See Document #30. According to the stipulation of the parties
and the Order of the Court, the Agency was required to file the administrative record by March 1,
2011. The brief of the plaintiffs was to be filed sixty days after the administrative record, the
Agency’s brief sixty days thereafter, with the plaintiffs’ reply brief, if any, filed fifteen days
thereafter.
On March 1, 2011, the Agency filed a motion for an extension of time to file the
administrative record, which the Court granted. The Agency then filed the administrative record on
March 2, 2011. On May 18, 2011, the plaintiffs filed a document styled “Plaintiffs’ Brief in Support
of Judicial Review.” That document stated, in its entirety:
COME NOW the Plaintiffs, David Pelzer, David and Ruth Pelzer, LLC, and David
and Matthew Pelzer, LLC, by and through counsel, and pursuant to Court’s Order of
February 14, 2011, hereby submits this matter on the full administrative record
developed through the administrative proceedings of the United States Department

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of Agriculture, Federal Crop Insurance Corporation, Risk Management Agency, and
filed by the Government on March 2, 2011.
The Agency has now filed a motion to dismiss on the ground that the plaintiffs failed to
comply with the Court’s Order directing that a brief be filed within sixty days after filing the
administrative record. The Agency contends that the plaintiffs have failed to prosecute this action
because they deliberately did not file a brief pursuant to the Court’s scheduling order, which, as
noted, set out a schedule to which the parties stipulated. The plaintiffs contend that the one sentence
document that they filed constitutes a brief and therefore they have not failed to comply with the
Court’s Order. They say that they intend to submit the case to the Court based on the administrative
record, so that the Court can determine based on the administrative record whether the
reconsideration decision by the Agency is arbitrary and capricious.
The Court has reviewed significant portions of the administrative record, focusing
particularly on the letters from the Agency explaining the denial of the plaintiffs’ requests for
reconsideration, as well as the information upon which the agency relied. It does not appear to the
Court that the decision to deny reconsideration was arbitrary or capricious. The Court has come to
that conclusion, however, without the benefit of any argument by the plaintiffs. If the plaintiffs
believe that the decision of the Agency to deny reconsideration was arbitrary or capricious, they must
submit a written brief explaining the reasons why they believe that decision was arbitrary or
capricious, calling the Court’s attention to the portions of the administrative record that support their
arguments. Any such brief must be filed on or before July 13, 2011. If the plaintiffs file such a brief,
the response by the governmental agencies will be due no later than sixty days after the plaintiffs’

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brief is filed. If the plaintiffs choose not to file a brief making arguments as to why the Agency’s
decision is arbitrary or capricious, the Court will summarily affirm.
IT IS SO ORDERED this 22nd day of June, 2011.

J. LEON HOLMES
UNITED STATES DISTRICT JUDGE

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