Sunflowers Convenience Store, LLC et al v. United States of America

Filing 8

ORDER denying 2 Motion to Stay Disqualification from Food Stamp Program Pending Judicial Review. So Ordered by Chief Judge Mary M. Lisi on 4/24/2012. (Duhamel, John)

UNITED STATES DISTRICT COURT
DISTRICT OF RHODE ISLAND
SUNFLOWERSCONVENffiNCE
STORE, LLC and
TUNDE AZEEZ,
Plaintiffs,
C.A. No. 11-577-ML

v.
UNITED STATES OF AMERICA,
UNITED STATES DEPARTMENT OF AGRICULTURE,
FOOD AND NUTRITION SERVICE,
Defendant.

In this action, Sunflowers Convenience store, LLC and its owner Tunde Azeez (together,
"Sunflowers" or "Plaintiffs") seek judicial review of a decision by the United States Department
of Agriculture, Food and Nutrition Service ("USDA" or "Defendant") permanently disqualifying
Sunflowers from the Supplemental Nutrition Assistance Program ("SNAP"). The matter before
the Court is Plaintiffs' motion to stay disqualification from the SNAP, pending disposition of the
instant action. Following a chambers conference on January 27, 2012, at the request of the
Court, both parties submitted memoranda in support of their respective positions. For the
reasons stated herein, Plaintiffs' motion is denied.
Background
Sunflowers is a convenience store located in North Providence, Rhode Island, that had
been authorized by USDA to participate in the SNAP. On two separate occasions in early 2011,

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USDA undercover investigators aver that they were able to exchange SNAP benefits for cash.
The "buying or selling of coupons, A TP cards or other benefit instruments for cash or
consideration other than eligible food" is "trafficking," which is strictly prohibited under the
SNAP. 7 C.F.R. § 271.2; 7 U.S.C. § 2021(b)(3)(B). The penalty for trafficking is permanent
disqualification from the SNAP. 7 U.S.C. § 2021(b)(3)(B). Plaintiffs do not specifically confirm
nor deny the trafficking allegations.
On August 16, 2011, USDA permanently disqualified Sunflowers from participating in
the SNAP. After the USDA denied Sunflowers' administrative appeal, Sunflowers brought suit
in this Court seeking judicial review of the disqualification decision. Sunflowers now requests a
stay of its disqualification from participating in the SNAP pending a decision on the merits of
this matter by this Court.
Discussion
Under 7 U.S.C. § 2023(a)(17), a retail food store may seek a stay of an administrative
decision under judicial review. Pursuant to § 2023(a)(17), an administrative action remains "in
full force and effect" during judicial review
unless on application to the court on not less than ten days' notice, and after
hearing thereon and a consideration by the court of the applicant's
likelihood ofprevailing on the merits and of irreparable injury, the court
temporarily stays such administrative action pending disposition of such
trial or appeal.
7 U.S.C. § 2023(a)(17). Section 2023(a)(18), however, provides:
Notwithstanding any other provision of this subsection, any permanent
disqualification of a retail food store ... shall be effective from the date of
receipt of the notice of disqualification. If the disqualification is reversed

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through administrative or judicial review, the Secretary shall not be liable
for the value of any sales lost during the disqualification period.
7 U.S.C. § 2023(a)(18) (emphasis added); see also 7 C.P.R.§ 279.7(d) (providing that
"permanent disqualification actions ... shall not be subject to ... a stay of administrative
action").
Plaintiffs argue that§ 2023(a)(18) does not prohibit a stay and only sets the effective date
of disqualification. Defendant contends that the plain meaning of the statute clearly expresses a
Congressional mandate that permanent disqualification remain in effect unless and until reversed
by the Court.
The Court agrees with Defendant that the plain language of the statute prohibits this
Court from granting a stay. The statute expressly requires that the disqualification take effect
upon the receipt ofthe notice of disqualification and remain in effect pending judicial review,
thus forbidding the Court from granting a stay. See Ilaian v. United States Department of
Agriculture, 87 F.Supp. 2d 1047, 1048 (S.D. Cal. 2000) (holding that "the plain language of7
U.S.C. § 2023(a)(18) reflects that a stay is not available in cases of permanent disqualification
for trafficldng"); see also Ameira Corporation v. Veneman, 169 F.Supp. 2d 432 (M.D.N.C. 2001)
(§ 2023(a)(18) does not allow a stay to be granted in cases oftrafficking).
The Court recognizes that a court in another district has conducted a Chevron 1 analysis in
construing 7 U.S.C. § 2023(a)(18) and 7 C.P.R.§ 279.7(d) and has concluded that§ 2023(a)(18)
is ambiguous. Skyson USA, LLC v. United States, 651 F. Supp. 2d 1202 (D. Haw. 2009). As
noted above, 7 C.P.R. 279.7(d) provides that "permanent disqualification actions ... shall not be

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Chevron U.S.A., Inc. v. National Resources Defense Council, Inc., 467 U.S. 837 (1984).

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subject to ... a stay of administrative action." 7 C.P.R. § 279.7(d). In Skyson, the court held
that§ 2023(a)(18) was ambiguous but that 7 C.P.R.§ 279.7(d) was "inherently reasonable given
the context of the statute." Skyson, 651 F. Supp. 2d at 1209. As a result, the Skyson court
concluded that it was prohibited from issuing a stay in a case of permanent disqualification. Id.
at 1209-10. Consequently, even ifthis Court were to find that§ 2023(a)(18) is ambiguous, it
would agree with the Chevron analysis in Skyson and conclude that, based on 7 C.F .R.
§ 279.7(d), issuing a stay in a case of permanent disqualification is prohibited. Skyson, 651 F.
Supp. 2d at 1209-10.
Conclusion
Based on the foregoing, Plaintiffs' motion for a stay of the disqualification pending
judicial review is denied. 2

SO ORDERED.

Is/ Mary M. Lisi
MaryM. Lisi
Chief United States District Judge
April24, 2012

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Plaintiffs also move, "in the alternative, [for] injunctive relief to prevent irreparable harm." Plaintiffs' Motion for
Stay at I; Docket #2. The Court views Plaintiffs' request as one for a decision on the merits granting permanent
injunctive relief. Thus, the Court will schedule a hearing on Plaintiffs' request for injunctive relief.

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