Texas Health and Human Services Commission v. Shanressa Craddock

Court of Appeals of Texas·Decided June 11, 2025·No. 15-25-00010-CV·Published

Opinion

ACCEPTED

15-25-00010-CV

FIFTEENTH COURT OF APPEALS AUSTIN, TEXAS

6/11/2025 3:43 PM

No. 15-25-00010-CV CHRISTOPHER A. PRINE _____________________________ CLERK FILED IN

15th COURT OF APPEALS

In the Court of Appeals AUSTIN, TEXAS for the Fifteenth Judicial District 6/11/2025 3:43:22 PM Austin, Texas CHRISTOPHER A. PRINE ______________________________ Clerk

TEXAS HEALTH AND HUMAN SERVICES COMMISSION, Appellant,

v.

SHANRESSA CRADDOCK,

Appellee.

On Appeal from the 250th Judicial District Court of Travis County, Texas Cause No. D-1-GN-22-007315

REPLY BRIEF FOR APPELLANT TEXAS HEALTH AND HUMAN SERVICES COMMISSION

KEN PAXTON JENNIFER COOK Attorney General of Texas Texas Bar No. 00789233 Assistant Attorney General BRENT WEBSTER General Litigation Division First Assistant Attorney General Office of the Attorney General P.O. Box 12548, Capitol Station RALPH MOLINA Austin, Texas 78711-2548 Deputy First Assistant Attorney General Phone: (737) 230-4700 FAX: (512) 320-0667

AUSTIN KINGHORN jennifer.cook@oag.texas.gov Deputy Attorney General for Civil Litigation Counsel for Appellant Texas Health and Human Services KIMBERLY GDULA Commission Chief, General Litigation Division

TABLE OF CONTENTS

INDEX OF AUTHORITIES .................................................................................... iii SUMMARY ...............................................................................................................1 ARGUMENT .............................................................................................................1 I. Contrary to Craddock’s assertion, HHSC’s determination to not replace benefits stolen by a third party was supported by substantial evidence. .................................2 A. Craddock’s claim that HHSC did not meet their burden at the hearing is both incorrect and an incorrect recitation of the standard of review. ....................2 B. HHSC did not fail to conduct any required evaluation; there was no system error malfunction associated with HHSC’s system. ..............................................3 C. Craddock’s claim that HHSC’s policy is contrary to law is false; rather, it is consistent with both Texas and federal regulations. ..............................................6 D. HHSC did not ignore uncontroverted evidence; rather, Craddock testified she gave her PIN and card number to a third party via an automated phone system and the disputed transaction, in which her correct card number and PIN were used, occurred the next day. .................................................................................12 II. Craddock erroneously claims HHSC applied internal policy instead of controlling regulation. ..............................................................................................13 III. HHSC’s policy does not conflict with federal law, and there is no federal preemption. ..............................................................................................................13 PRAYER ..................................................................................................................16

ii

INDEX OF AUTHORITIES

Statutes 7 U.S.C. § 2012 ........................................................................................................14 7 U.S.C. § 2016 ................................................................................................. 13, 14 7 U.S.C. § 2020 ........................................................................................... 13, 14, 15 Tex. Gov’t Code § 545.0154 ......................................................................................2 Rules 1 Tex. Admin. Code § 372.1518 ............................................................................8, 9 1 Tex. Admin. Code § 372.1519 ................................................................. 7, 8, 9, 10 1 Tex. Admin. Code § 372.1521 ............................................................... 5, 6, 10, 13 Tex. R. App. P. 9.4....................................................................................................17 Regulations 7 C.F.R. § 271.2 .......................................................................................................10 7 C.F.R. § 273.17 .............................................................................................. 13, 15 7 C.F.R. § 274.12 .......................................................................................................8 7 C.F.R. § 274.6 .........................................................................................................9 7 C.F.R. § 276.2 ................................................................................................. 10, 11 7 C.F.R. § 277.18 .............................................................................10, 11, 12, 13, 16

iii

SUMMARY

There is substantial evidence Shanressa Craddock (“Craddock”) gave her

SNAP benefits EBT card information and PIN to an unknown and unauthorized person via a phone automated system, and then her card and PIN was used the next day for a $930 unauthorized transaction on August 20, 2022. There is substantial evidence the unauthorized transaction was not due to any error or fault by the Texas Health and Human Services Commission (“HHSC” or “Appellant”).

After the unauthorized transaction, Craddock contacted HHSC and requested that HHSC replace the stolen benefits. Consistent with Texas and federal regulations and HHSC policies and procedures, HHSC declined to replace the benefits because the transaction was not due to any error on HHSC’s part and took place before Craddock reported her card information as stolen. This Court should reverse the district court’s ruling and affirm HHSC’s decision.

ARGUMENT

There was substantial evidence supporting HHSC’s determination not to

replace Craddock’s benefits stolen by a third party. Such determination did not contain legal error and does not conflict with any laws. HHSC’s determination is consistent and compliant with the applicable Texas and federal regulations.

I. Contrary to Craddock’s assertion, HHSC’s determination to not replace benefits stolen by a third party was supported by substantial evidence.

In Appellee’s Brief, Craddock first asserts that HHSC’s decision was not

supported by substantial evidence. Contrary to Craddock’s assertion, HHSC met the standard of review in this case, which is that its decision is supported by substantial evidence.

A. Craddock’s claim that HHSC did not meet their burden at the hearing is both incorrect and an incorrect recitation of the standard of review.

In Appellee’s Brief, Craddock claims HHSC did not meet its burden at the hearing stage. Appellee’s Brief at 16. While HHSC maintains that it did meet its burden at the hearing, the standard of review on appeal is whether HHSC’s decision is supported by substantial evidence—which it was.

In Appellee’s Brief, there is a section claiming HHSC did not meet its burden at the hearing stage. Appellee’s Brief at 16-18. While HHSC disputes this assertion, the standard of review in this case is substantial evidence as discussed in Appellant’s brief (“Appellant’s Brief”). Tex. Gov’t Code § 545.0154(c); see also Appellant’s Brief at 6-9.

Substantial evidence supports HHSC’s denial of replacement benefits to Craddock. The evidence shows Craddock received a text on August 19, 2022, and in response, called the phone number provided in the text, believing the sender was

associated with HHSC, and provided an unauthorized third party with her card number and PIN. AR at 35, 70-76. However, the text was not from HHSC or anyone associated with HHSC. AR at 71-72, 75-76. The next day, an unauthorized third party utilized Craddock’s information in an unauthorized transaction of $930. AR at 33-38, 68-71. After Craddock realized benefits were missing from her card, she contacted HHSC, and the card’s status was changed to stolen. AR at 66.

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Related

Definitions
7 U.S.C. § 2012
Administration
7 U.S.C. § 2020