UNPUBLISHED
UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT
No. 18-1869
ISRAEL K. NEGASH, an individual; ETHIO, INC., a Maryland Corporation d/b/a Sunoco Food Mart,
Plaintiffs - Appellants,
v.
UNITED STATES OF AMERICA,
Defendant - Appellee.
Appeal from the United States District Court for the District of Maryland, at Baltimore. Richard D. Bennett, District Judge. (1:17-cv-01954-RDB)
Submitted: March 26, 2019 Decided: May 7, 2019
Before WILKINSON and HARRIS, Circuit Judges, and HAMILTON, Senior Circuit Judge.
Affirmed by unpublished per curiam opinion.
Andrew Z. Tapp, METROPOLITAN LAW GROUP, PLLC, Brandon, Florida; William N. Sinclair, SILVERMAN THOMPSON SLUTKIN WHITE, LLC, Baltimore, Maryland, for Appellants. Robert K. Hur, United States Attorney, Alan C. Lazerow, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Baltimore, Maryland, for Appellee.
Unpublished opinions are not binding precedent in this circuit. PER CURIAM:
Israel K. Negash and Ethio, Inc. (collectively, Appellants), filed a petition
pursuant to 7 U.S.C. § 2023 (2012), seeking judicial review of the United States
Department of Agriculture (USDA)’s decision to permanently disqualify them from
participating in the Supplemental Nutrition Assistance Program (SNAP). The district
court granted the USDA’s motion for summary judgment and denied the Appellants’ Fed.
R. Civ. P. 59(e) motion. The Appellants contend that the district court erred in granting
summary judgment prior to discovery. We affirm the district court’s orders.
We “review[] de novo the district court’s order granting summary judgment.”
Jacobs v. N.C. Admin. Office of the Courts, 780 F.3d 562, 565 n.1 (4th Cir. 2015). “A
district court ‘shall grant summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.’”
Id. at 568 (quoting Fed. R. Civ. P. 56(a)). “A dispute is genuine if a reasonable jury
could return a verdict for the nonmoving party.” Id. (internal quotation marks omitted).
In determining whether a genuine dispute of material fact exists, “we view the facts and
all justifiable inferences arising therefrom in the light most favorable to . . . the
nonmoving party.” Id. at 565 n.1 (internal quotation marks omitted). However, “the
nonmoving party must rely on more than conclusory allegations, mere speculation, the
building of one inference upon another, or the mere existence of a scintilla of evidence.”
Dash v. Mayweather, 731 F.3d 303, 311 (4th Cir. 2013).
“We review a district court’s denial of a Rule 56(d) motion for abuse of
discretion.” Pisano v. Strach, 743 F.3d 927, 931 (4th Cir. 2014). We will not reverse the
2 denial of a Rule 56(d) motion absent a clear abuse of discretion or a real possibility that
the denial of discovery resulted in prejudice to the moving party. Strag v. Bd. of Trs., 55
F.3d 943, 954 (4th Cir. 1995). Relief under Rule 56(d) is “broadly favored and should be
liberally granted in order to protect non-moving parties from premature summary
judgment motions.” McCray v. Md. Dep’t of Transp., 741 F.3d 480, 484 (4th Cir. 2014)
(internal quotation marks omitted). However, “a court may deny a Rule 56(d) motion
when the information sought would not by itself create a genuine issue of material fact
sufficient for the nonmovant to survive summary judgment.” Pisano, 743 F.3d at 931.
“Congress has been quite firm in ensuring that [SNAP benefits] are used only to
purchase eligible food items, and are not exchanged for cash or other things of value.”
Idias v. United States, 359 F.3d 695, 697 (4th Cir. 2004) (internal quotation marks
omitted). “[A] store that is caught trafficking in food stamps even one time must be
permanently disqualified from [SNAP], unless the Secretary of Agriculture determines
that the store had in place an effective anti-trafficking policy.” Id. Trafficking is defined,
as relevant here, as “buying, selling, stealing or otherwise effecting an exchange of SNAP
benefits issued and accessed via [EBT] cards . . . for cash or consideration other than
eligible food, either directly, indirectly, in complicity or collusion with others, or acting
alone.” 7 C.F.R. § 271.2 (2018). An aggrieved party may seek judicial review of the
USDA’s finding that it trafficked in benefits. 7 U.S.C. § 2023(a)(13). Unlike most
judicial review of agency action, review of the USDA’s trafficking determination is de
novo, and is not limited to the administrative record. 7 U.S.C. § 2023(a)(15).
3 We conclude that the district court did not abuse its discretion in granting
summary judgment prior to discovery. On appeal, the Appellants seek primarily two
pieces of information—the identities of the stores the USDA compared the Appellants’
store’s sales to (“the comparison stores”) and the identity of the households whose
transactions the USDA identified as suspicious. As to the comparison stores, the
Appellants contend that this information is necessary for them to discover whether they
were appropriate comparators. For the household information, the Appellants argue they
could use this information to obtain affidavits or depose them to discover the reasons for
their shopping habits.
While this information would have been useful, the Appellants did not seek this
information in the district court. Absent exceptional circumstances, we will not consider
issues raised for the first time on appeal. See In re Under Seal, 749 F.3d 276, 285 (4th
Cir. 2014). In the district court, the Appellants only sought the identity of the households
to demonstrate that they shopped at their store because of their selection of ethnic food.
This evidence cannot create a genuine dispute of material fact given the objective
evidence in the record demonstrating that the store’s inventory was similar to that of a
normal convenience store—the pictures taken by the USDA’s inspector and the invoices
submitted by the Appellants. See Scott v. Harris, 550 U.S. 372, 380 (2007) (“When
opposing parties tell two different stories, one of which is blatantly contradicted by the
record, so that no reasonable jury could believe it, a court should not adopt that version of
the facts for purposes of ruling on a motion for summary judgment.”).
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UNPUBLISHED
UNITED STATES COURT OF APPEALS FOR THE FOURTH CIRCUIT
No. 18-1869
ISRAEL K. NEGASH, an individual; ETHIO, INC., a Maryland Corporation d/b/a Sunoco Food Mart,
Plaintiffs - Appellants,
v.
UNITED STATES OF AMERICA,
Defendant - Appellee.
Appeal from the United States District Court for the District of Maryland, at Baltimore. Richard D. Bennett, District Judge. (1:17-cv-01954-RDB)
Submitted: March 26, 2019 Decided: May 7, 2019
Before WILKINSON and HARRIS, Circuit Judges, and HAMILTON, Senior Circuit Judge.
Affirmed by unpublished per curiam opinion.
Andrew Z. Tapp, METROPOLITAN LAW GROUP, PLLC, Brandon, Florida; William N. Sinclair, SILVERMAN THOMPSON SLUTKIN WHITE, LLC, Baltimore, Maryland, for Appellants. Robert K. Hur, United States Attorney, Alan C. Lazerow, Assistant United States Attorney, OFFICE OF THE UNITED STATES ATTORNEY, Baltimore, Maryland, for Appellee.
Unpublished opinions are not binding precedent in this circuit. PER CURIAM:
Israel K. Negash and Ethio, Inc. (collectively, Appellants), filed a petition
pursuant to 7 U.S.C. § 2023 (2012), seeking judicial review of the United States
Department of Agriculture (USDA)’s decision to permanently disqualify them from
participating in the Supplemental Nutrition Assistance Program (SNAP). The district
court granted the USDA’s motion for summary judgment and denied the Appellants’ Fed.
R. Civ. P. 59(e) motion. The Appellants contend that the district court erred in granting
summary judgment prior to discovery. We affirm the district court’s orders.
We “review[] de novo the district court’s order granting summary judgment.”
Jacobs v. N.C. Admin. Office of the Courts, 780 F.3d 562, 565 n.1 (4th Cir. 2015). “A
district court ‘shall grant summary judgment if the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a matter of law.’”
Id. at 568 (quoting Fed. R. Civ. P. 56(a)). “A dispute is genuine if a reasonable jury
could return a verdict for the nonmoving party.” Id. (internal quotation marks omitted).
In determining whether a genuine dispute of material fact exists, “we view the facts and
all justifiable inferences arising therefrom in the light most favorable to . . . the
nonmoving party.” Id. at 565 n.1 (internal quotation marks omitted). However, “the
nonmoving party must rely on more than conclusory allegations, mere speculation, the
building of one inference upon another, or the mere existence of a scintilla of evidence.”
Dash v. Mayweather, 731 F.3d 303, 311 (4th Cir. 2013).
“We review a district court’s denial of a Rule 56(d) motion for abuse of
discretion.” Pisano v. Strach, 743 F.3d 927, 931 (4th Cir. 2014). We will not reverse the
2 denial of a Rule 56(d) motion absent a clear abuse of discretion or a real possibility that
the denial of discovery resulted in prejudice to the moving party. Strag v. Bd. of Trs., 55
F.3d 943, 954 (4th Cir. 1995). Relief under Rule 56(d) is “broadly favored and should be
liberally granted in order to protect non-moving parties from premature summary
judgment motions.” McCray v. Md. Dep’t of Transp., 741 F.3d 480, 484 (4th Cir. 2014)
(internal quotation marks omitted). However, “a court may deny a Rule 56(d) motion
when the information sought would not by itself create a genuine issue of material fact
sufficient for the nonmovant to survive summary judgment.” Pisano, 743 F.3d at 931.
“Congress has been quite firm in ensuring that [SNAP benefits] are used only to
purchase eligible food items, and are not exchanged for cash or other things of value.”
Idias v. United States, 359 F.3d 695, 697 (4th Cir. 2004) (internal quotation marks
omitted). “[A] store that is caught trafficking in food stamps even one time must be
permanently disqualified from [SNAP], unless the Secretary of Agriculture determines
that the store had in place an effective anti-trafficking policy.” Id. Trafficking is defined,
as relevant here, as “buying, selling, stealing or otherwise effecting an exchange of SNAP
benefits issued and accessed via [EBT] cards . . . for cash or consideration other than
eligible food, either directly, indirectly, in complicity or collusion with others, or acting
alone.” 7 C.F.R. § 271.2 (2018). An aggrieved party may seek judicial review of the
USDA’s finding that it trafficked in benefits. 7 U.S.C. § 2023(a)(13). Unlike most
judicial review of agency action, review of the USDA’s trafficking determination is de
novo, and is not limited to the administrative record. 7 U.S.C. § 2023(a)(15).
3 We conclude that the district court did not abuse its discretion in granting
summary judgment prior to discovery. On appeal, the Appellants seek primarily two
pieces of information—the identities of the stores the USDA compared the Appellants’
store’s sales to (“the comparison stores”) and the identity of the households whose
transactions the USDA identified as suspicious. As to the comparison stores, the
Appellants contend that this information is necessary for them to discover whether they
were appropriate comparators. For the household information, the Appellants argue they
could use this information to obtain affidavits or depose them to discover the reasons for
their shopping habits.
While this information would have been useful, the Appellants did not seek this
information in the district court. Absent exceptional circumstances, we will not consider
issues raised for the first time on appeal. See In re Under Seal, 749 F.3d 276, 285 (4th
Cir. 2014). In the district court, the Appellants only sought the identity of the households
to demonstrate that they shopped at their store because of their selection of ethnic food.
This evidence cannot create a genuine dispute of material fact given the objective
evidence in the record demonstrating that the store’s inventory was similar to that of a
normal convenience store—the pictures taken by the USDA’s inspector and the invoices
submitted by the Appellants. See Scott v. Harris, 550 U.S. 372, 380 (2007) (“When
opposing parties tell two different stories, one of which is blatantly contradicted by the
record, so that no reasonable jury could believe it, a court should not adopt that version of
the facts for purposes of ruling on a motion for summary judgment.”).
4 As to the comparison stores, in the district court the Appellants only sought the
transaction data for the stores the USDA compared their store to. However, this
information would not have created a genuine dispute of material fact. While the USDA
did not reveal the identities of the comparison stores, the administrative record contains
their EBT sales data and they were all located within one mile of the Appellants’ store.
Additionally, the administrative record shows that several of the Appellants’ store’s
customers also used their EBT benefits at larger grocery stores and supermarkets,
rebutting their contention that their customers lacked transportation to such businesses.
To the extent that the Appellants seek this information to argue that they have a more
superior grocery selection than the comparison stores, the record clearly refutes their
argument that they were anything other than a normal convenience store. While a court
considering a summary judgment motion must give the nonmoving party the benefit of
all reasonable inferences, the Appellants instead ask us to abandon common sense—the
USDA rightfully concluded that there is no logical explanation for 72 individuals
spending over $100 on convenience store items when the Appellants’ store does not have
a single shopping cart or basket, households were visiting larger grocery stores in
addition to the Appellants’ store, and suspicious transactions quickly decreased once the
Appellants were on notice that their sales were under investigation.
Accordingly, we affirm the district court’s orders. We dispense with oral
argument because the facts and legal contentions are adequately presented in the
materials before this court and argument would not aid the decisional process.
AFFIRMED