Tennessee Department of Human Services v. United States Department of Education, Wayne Hinton

979 F.2d 1162, 117 A.L.R. Fed. 839, 1992 U.S. App. LEXIS 30164, 1992 WL 334152
CourtCourt of Appeals for the Sixth Circuit
DecidedNovember 18, 1992
Docket91-5768
StatusPublished
Cited by41 cases

This text of 979 F.2d 1162 (Tennessee Department of Human Services v. United States Department of Education, Wayne Hinton) is published on Counsel Stack Legal Research, covering Court of Appeals for the Sixth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Tennessee Department of Human Services v. United States Department of Education, Wayne Hinton, 979 F.2d 1162, 117 A.L.R. Fed. 839, 1992 U.S. App. LEXIS 30164, 1992 WL 334152 (6th Cir. 1992).

Opinion

ALAN E. NORRIS, Circuit Judge.

A blind vendor appeals the district court’s judgment that set aside, as violative of the Eleventh Amendment, a federal arbitration panel’s award of retroactive damages against a state agency under the Randolph-Sheppard Act.

I.

This case requires us to decide whether arbitration awards for retroactive damages against state agencies under the Randolph-Sheppard Vending Stand Act, 20 U.S.C. §§ 107-107Í, violate the Eleventh Amendment. We begin our analysis with a brief overview of the statutory scheme.

The Randolph-Sheppard Act was enacted in order to provide employment opportunities for the blind. The Act grants priority to those blind persons who desire to operate vending facilities on federal property. 20 U.S.C. § 107(b). The Act divides responsibility for the blind vendor program between the state and federal agencies. The Secretary of Education is responsible for interpreting and enforcing the Act’s provisions, and more specifically, for designating state licensing agencies. 20 U.S.C. §§ 107a(a)(5), 107b; 34 C.F.R. §§ 395.5, 395.8. A person seeking a position as a blind vendor applies to the designated state agency and is licensed by that agency. The state agency in turn applies to the federal government for the placement of the licensee on federal property. 20 U.S.C. § 107b. Once the state and the federal government have agreed on an appropriate location for the vending facility, the state licensing agency is responsible for equipping the facility and furnishing the initial stock and inventory. 20 U.S.C. § 107b(2). *1164 The blind vendor thereafter operates as a sole proprietor who is entitled to the profits of the vending facility and who is responsible for the facility’s losses.

The Act requires that if the state licensing agency operates vending machines that directly compete 1 with a vending facility operated by a blind vendor, then a percentage of the income from such competing machines must be given to the blind vendor licensed to do business on that property. 20 U.S.C. § 107d-3. If no licensee is operating a facility on the property, the income from state-operated vending machines is used for a variety of purposes that benefit all blind vendors in the state program. 20 U.S.C. § 107d-3(c).

In order to resolve disputes arising under the Act, both administrative and judicial remedies are available for licensed blind vendors. The Secretary of Education may decertify a state licensing agency that refuses to cooperate with the Secretary. 34 C.F.R. § 395.17. In all other situations, the Secretary must rely on a blind vendor to file a complaint in order to enforce the Act’s substantive provisions. If a blind vendor has a complaint regarding the state’s operation of the program, he or she may request an evidentiary hearing before the state licensing agency and, if dissatisfied with the outcome of the hearing, may ask the Secretary to convene an arbitration panel to resolve the dispute. 20 U.S.C. §§ 107d-l(a), 107d-2(b)(l). An arbitration panel’s decision is subject to review as a final agency action. 20 U.S.C. § 107d-l(a).

From 1978 until 1986, Wayne Hinton was a blind vendor at the Tennessee Valley Authority’s Watts Bar Nuclear Power Plant, a federal facility located in Tennessee. He was licensed by the Tennessee Department of Human Services (TDHS), the state agency designated by the Secretary. TDHS issued two permits to operate vending facilities at the plant. One permit authorized Hinton to conduct vending in the “power site.” The second permit authorized vending in the “construction site.” Vending machines were installed at the construction site in late 1978 or early 1979, and were operated by sighted vendors. TDHS used the income from the machines to purchase health insurance for blind vendors.

This dispute began in August 1984 when Hinton claimed the income from the construction site machines. Hinton asserted that the construction site was on the same premises as his stand and therefore was in direct competition with his stand. Acting upon Hinton’s request for an evidentiary hearing before TDHS, the state hearing officer determined that the construction site was part of the same property as the power site, and was in competition with it. The state hearing officer then issued an order granting Hinton’s claim to past and future income from the construction site machines. Thereafter, the Commissioner of TDHS reversed the award, finding that the two sites were separate properties, and entered a final order denying Hinton’s claims.

Following this determination, Hinton filed a complaint with the Secretary of Education requesting an arbitration panel. The Secretary refused the request, noting that sovereign immunity precluded retroactive relief, and that prospective relief no longer was available because the vending facilities at the construction site recently were assigned to other blind vendors. Hinton filed an action in the district court to compel the Secretary to convene the arbitration panel. The district court determined that the Act created a mandatory duty and ordered the Secretary to convene the panel. Hinton v. United States Dep’t of Educ., 700 F.Supp. 21, 23 (E.D.Tenn.1988).

The arbitration panel determined that the power plant was a single property, and that the vending facilities were in direct competition with Hinton's vending facility. Ac *1165 cordingly, the panel ordered the state agency to pay Hinton the construction site vending machine income accrued from 1978 through 1986. The panel also awarded Hinton interest and attorneys’ fees.

TDHS filed a petition for review in the United States District Court for the Eastern District of Tennessee, contending that the panel’s factual findings were erroneous and that the Eleventh Amendment barred the award. The complaint named Hinton and the United States Department of Education as defendants, but the Department filed a memorandum in support of the state agency’s position.

After all three parties moved for judgment on the pleadings, the district court granted judgment to TDHS and the Department of Education and vacated the arbitration panel’s award.

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Bluebook (online)
979 F.2d 1162, 117 A.L.R. Fed. 839, 1992 U.S. App. LEXIS 30164, 1992 WL 334152, Counsel Stack Legal Research, https://law.counselstack.com/opinion/tennessee-department-of-human-services-v-united-states-department-of-ca6-1992.