Boyd v. Glickman

12 F. Supp. 2d 1261, 1998 U.S. Dist. LEXIS 10619, 1998 WL 397049
CourtDistrict Court, M.D. Alabama
DecidedJuly 9, 1998
DocketCivil Action 98-A-83-S
StatusPublished

This text of 12 F. Supp. 2d 1261 (Boyd v. Glickman) is published on Counsel Stack Legal Research, covering District Court, M.D. Alabama primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Boyd v. Glickman, 12 F. Supp. 2d 1261, 1998 U.S. Dist. LEXIS 10619, 1998 WL 397049 (M.D. Ala. 1998).

Opinion

MEMORANDUM OPINION

ALBRITTON, Chief Judge.

I. INTRODUCTION

This cause is before the court on a Motion to Dismiss the Plaintiffs’ Complaint, which is being treated as a Motion for Summary Judgment, 1 and a Motion to Dismiss the Intervenor’s Complaint, also being treated as a Motion for Summary Judgment, filed by the Defendants Dan Glickman, in his official capacity as Secretary of the United States Department of Agriculture; and Keith Kelley, in his official capacity as Executive Vice-President of the Commodity Credit Corporation (“CCC”), and Administrator of the Farm Service Agency; USDA, CCC and the Farm Service Agency (collectively “the Defendants”).

The Plaintiffs Ray T. Boyd, Charles Michael Hines, James E. Kelley d/b/a Kelley Farms, and Sessions Company, Inc. (“Plaintiffs”) filed their Complaint on January 28, 1998. The Plaintiffs bring claims against the Defendants, alleging that the Defendants have acted arbitrarily and capriciously in the method by which they inspect and classify peanuts or permit that to be done, (Count I), and that the Defendants have acted arbitrarily and capriciously in treating peanut growers differently from peanut shellers (Count II), and that a justiciable controversy exists as to rights and obligations under USDA regulations (Count III). Plaintiffs seek declaratory and injunctive relief.

On January 28, 1998, the Plaintiffs filed a Motion for a Temporary Restraining Order and a Preliminary Injunction. The court granted the Motion for a Temporary Restraining Order and then entered an Order extending the Temporary Restraining Order until April 2,1998.

On March 2, 1998, the American Peanut Shellers Association (“APSA”) filed a Motion to Intervene which was granted on March 11, *1264 1998. The Intervenor, APSA, filed a Complaint on March 11,1998.

The court has allowed the filing of Amicus Curiae Briefs by the American Peanut Product Manufacturers, Inc.; the Alabama Peanut Producers Association, Florida Peanut Producer Association, Georgia Agricultural Commodity Commission, and GFA Peanut Association; and the-Georgia Peanut Producers Association, New Mexico Peanut Growers Association, Oklahoma Peanut Growers Association, Southwestern Peanut Growers Association, and the Texas Peanut Growers Association.

On June 30,1998, the court held oral argument in this case on both motions for summary judgment.

For reasons to be discussed, the Motions for Summary Judgment are due to be GRANTED.

II. FACTS

The submissions of the parties establish the following facts:

Plaintiffs Boyd, Hines, and Kelly are farmers who grow, harvest, and market peanuts in Coffee and Geneva Counties in the state of Alabama. Plaintiff Sessions Company, Inc. is a corporation which handles and shells peanuts. Defendant Gliekman is the Secretary of the United States Department of Agriculture (“USDA”). Defendant Kelley is Executive Vice President of the Commodity Credit Corporation (“CCC”) and the Administrator of the Farm Service Agency (“FSA”).

The Plaintiffs in this case are challenging the support payments for their peanuts. As part of the Peanut Price Support Program, the Secretary of the USDA establishes a national marketing quota for peanuts that regulates the quality of edible peanuts that may be produced and marketed within the United States. The Secretary of the USDA provides price supports for peanuts through the .CCC. The CCC makes warehouse storage loans to cooperative peanut marketing associations. When farmers bring their harvested peanuts to the buying point, there are two potential purchasers of the farmers’ peanuts: a peanut shelling company or the United States Government. If the farmers do not sell their peanuts commercially, the farmers exchange the peanuts for a nonre-course loan from the CCC at the support price set by Congress. The CCC and producer associations then sell the “loan” peanuts to recover the money paid in price support loans. Peanuts which exceed the quota peanut amount are known as “additional peanuts.” Additional peanuts are eligible for price supports at a lower additional loan rate.

When the farmers tender their peanuts for purchase, each load is visually inspected by a representative of the Federal-State Inspection Service (“FSIS”). A sample is drawn from the load and the price support payment is computed based on the quality of the load. There are three categories into which peanuts may be placed: Segregation 1, Segregation 2, and Segregation 3. Segregation 1 peanuts are peanuts of good quality. Segregation 2 peanuts have suffered a prescribed level of damage. Segregation 3 peanuts are peanuts which have visible Asper-gillus flavus mold (“A flavus ”).

A flavus and Aspergillus parasiticus are molds which produce aflatoxin. Aflatoxin is a chemical compound which is carcinogenic and renders peanuts unfit for human consumption under standards established by the United States government. Although the molds produce aflatoxin, they do not always produce aflatoxin. The FSIS employees conduct a visual inspection of a farmer’s peanuts by using a light microscope in order to detect the presence of A. flavus mold. The Plaintiffs contend that a back-up method to visual testing is required so that peanuts graded as Segregation 3 can be re-tested.

Over time, the United States government has developed regulations for determining price supports for Segregation 3 peanuts. In the past, the USDA has had a “24-hour rule” by which a peanut producer whose lot was classified as Segregation 3 could have the lot cleaned and returned for a second inspection on the next workday following the initial inspection. This policy was abolished by the USDA in the late 1970’s. The Plaintiffs assert in their Complaint that the “24 hour rule” was abolished without use of the proper rule-making procedure. The Plaintiffs ask that this rule be re-instituted so that they *1265 have an opportunity to clean peanuts graded as Segregation 3 peanuts.

Also relevant to price supports for peanuts are the availability of “disaster” transfers. In 1978, Congress provided that if a farmer had not used up his total quota at the end of the year through the total Segregation 1 production and retention of peanuts for seed use, the farmer could effect a “disaster” transfer by moving a volume of additional peanuts equal to the shortfall between the full quota and the actual quota marketings from the additional peanut pool to the quota pool. In the 1996 Farm Bill, Congress limited disaster transfers which had previously been available by limiting farmers with Segregation 3 peanuts to disaster transfers of up to 25% of the poundage allotted the farmer under his or her quota. Also, the loan amount for the Segregation 3 peanuts transferred cannot exceed 70% of the quota support price for the peanuts.

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Bluebook (online)
12 F. Supp. 2d 1261, 1998 U.S. Dist. LEXIS 10619, 1998 WL 397049, Counsel Stack Legal Research, https://law.counselstack.com/opinion/boyd-v-glickman-almd-1998.