United States Court of Appeals

FOR THE EIGHTH CIRCUIT

_____________ No. 96-2477MN

_____________ Minnesota Department of * Economic Security, State * Services for the Blind and * Visually Handicapped; * * Plaintiff-Appellee, * * Dennis Groshel, * * Intervenor Plaintiff- * Appeal from the United States Appellee, * District Court for the Distric t * of Minnesota. v. * * Richard Riley, United States * Secretary of Education; * United States Department of * Veterans Affairs; James B. * Donahoe, in his official * capacity as Director, Veterans * Canteen Service, * * Defendants-Appellants.*

_____________ Submitted: October 23, 1996 Filed: February 26, 1997

_____________ Before FAGG, BOWMAN, and HANSEN, Circuit Judges.

_____________ FAGG, Circuit Judge.
The Randolph-Sheppard Vending Stand Act, 20 U.S.C. §§ 107-10 7f (1994) (the Act), gives blind persons licensed by a state li censing agency priority to operate ven ding facilities on federal property. This d ispute began more than ten years ago, when Minnesota' s lice nsing agency, the Minnesota Department of Economic Securit y (formerly the Minnesota Department of Jobs and Training)(Min nesota), applied under the Act and its correspondin g

regulations for a vending permit for the Veterans Affairs Medical Cen ter in St. Cloud, Minnesota (VA Medical Center). Minnesota' s application was rejected by th e Department of Veterans Affairs and the Veterans' Canteen Service (collectively VCS), which claimed to be exempt from the Act. Minnesota sought arbitration, as the Act provides. See 20 U.S.C. § 107d-1(b). The arbitration panel (the Panel) held the VCS was subjec t to the Act. The VCS and Minnesota then j ointly submitted five disputed issues for the Panel t o resolve. Only two are relevan t to this appeal. The Panel decided Minnesota's licensed blind vendor Dennis Groshel should pay the VCS a commission on vending sales, and the VCS does not have the "right to install and operate its ownvending machines" at the VA Medical Center.
Minnesota sought judicial revi ew in the district court, which decided commission payments violate the Act. The VCS appealed to this court, and we affirmed. See Minnesota Dep't of Jobs & Training v. Riley , 18 F.3d 606, 608 (8th Cir. 1994). We held the Act ap plies to the VCS. See id. at 608-09. We also held tha t commis sionpayments, like any limitation on a blind vendor' s oper ation, are unlawful unless approved by the Secretary o f Education. See id. at 609; 20 U.S.C. § 107(b). Although Rile y paved the way for Minnesota to receive its vending permit, the VCS contin ued and continues to stonewall Minnesota and its blin d licensee. Ignoring the Act, t he Panel's decision, and our opinion in Riley , the VCS offered Minnesota a permit, but only if Mi nnesota agrees the VCS can install competing vending machines at the V A Med ical Center. Minnesota returned to the district court, whic h grante dMinnesota's motion to enforce the Panel's decision. I n doing so, the district court recognized that "installation o f vending machines by the VCS is undoubtedly an attempt to limit the income of the blind vendor[] which must be approved [by] th e Secretaryof the [Department of Education] prior t o impl ementation." Although the district court characterized it s enforcement order as a preliminary injunction, we agree with the-3-

VCS that, for the purpose of review, we should treat the order as a permanent injunction because Minnesota and the VCS disagree only about the law, and nothing remains for the district court t o resolve

. Likewise, we agree with the VCS that we review th e disputed questions of law de novo. See International Ass'n o f Machinists & Aerospace Workers, Dist. Lodge No. 19 v. Soo Li ne R.R. Co. , 850 F.2d 368, 374 (8th Cir. 1988) (en banc). On appeal, the VCS once again claims exemptio n from the Act. Our earlier opinion in Rileyforecloses this claim.
Echoing its argument in Riley , the VCS contends it need no t complywith § 107(b), which prohibits any limitation on a blin d vendor's operation unless approved by the Secretary of Education, because the Veterans' Canteen Service Act independently authorizes the VCS to operate vending mac hines at the VA Medical Center. See 38 U.S.C. § 7802. Further, the VCS asserts that when it operates wit hinthe parameters of § 7802, neither an arbitration pane l convened under 20 U.S.C. § 107d-1(b) nor the district court ca n hold the V CS answerable for violations of the Act. In Riley , however, we held the VCS must comply with every provision of th e Act, and that includes §§ 107(b) and 107d-1(b). See 18 F.3d a t 608-09. We have never questioned the VCS's authority to operat e canteens, install vending machines, or do anything else the VCS's enabling legislation empowers it to do. But in Riley , we held the Act precludes the VCS's exercise of its statutory authority whe n tha t exercise would limit a blind vendor's operation, unless th e Secretary approves the limitation. See id. at 609-10. Here, the VCS does not challenge the district court's finding that "co mpeting vending machines will . . . un dermine or . . . destroy [the] blind vendo r's ability to obtain what is already a small income." N o less than commission payments, competing machines would limit the blind vendor's operation. Rileyrules out both, unless th e Secretary decides otherwise.
In truth, the VCS has done far more than merely limit the-4-

blind vendor's operation at the VA Medical Center. Congres s
assu medfederal agencies would respect a blind person's vendin g enterprise and willingly comply with the Act. See 20 U.S.C

. § 107d-2(b)(2). Instead, the VCS has tried to drive the blin d vendor out of its domain. Testifying before the Panel in 1988, a VCS official said: Basically as long as this disp ute lasts the guy who is going to suffer over it is going to be [th e blind vendor] because prices are going to continue to go up, and we are going to continue to hol d until this is resolved. The longer it goes on the less money he is going to make. Nine y ears later, the VCS is still at it, demanding the right t o install machines that would, as the district court found, destroy the blind vendor's livelihood. It is time for the VCS's scorchedearth campaign to end. Although Minnesota, in securing a permit, must work within the Act's regulatory scheme, Rileymakes clear-- andwe hold today--that unless the VCS gets the Secretary' s approval, the VCS may not insist Minnesota accept the presence of VCS vendin g machines at the VA Medical Center as the price o f Minnesota's permit.
Finally, the VCS raises two other issues. First, the VC S
co ntends arbitration panels convened under § 107d-1(b) have n o authorityto order remedies for violations of the Act. Se e Maryland State Dep't of Educ. v. United States Dep't of Veteran s Affairs , 98 F.3d 165, 169-71 (4th Cir. 1996); Georgia Dep't o f Human Resources v. Nash , 915 F.2d 1482, 1491-92 (11th Cir. 1990). The VCS's argument is misplaced. The Panel never ordered the VCS to take any remedial action, but simply decided competing VC S vending machines at the VA Medical Center would violate the Act

. The Panel did exactly what the statute authorizes. See 20 U.S.C. § 107d-2(b)(2); Maryland State Dep't of Educ. , 98 F.3d at 169-71; Nash , 9 15 F.2d at 1491-92. Indeed, by insisting on a permi t condi tionat odds with the Panel's decision, it is the VCS tha t ignores its statutory responsibility to bring itself into-5-

compl iance with the Act. See Maryland State Dep't of Educ. , 9 8 F.3d at 171. Second, the VCS questions whether the Panel's no-VCSmachines decision continues inforce because the Panel's reasoning interweaves that decision with its overturned ruling on commission payments. If the two decisions were as mutually dependent as the VCS now claims, it is surprising the VCS did not say so when th e commis sions issue was before us in Riley . Nevertheless, th e argume nt is without merit. The VCS itself, together wit h Minnesota, asked the Panel to resolve two separate disputed issues, commis sionpayments and competing machines. In deciding agains t the VCS's vending machines, th e Panel took into consideration that the VCS would receive commissi ons. The Panel never said, however, that if Minnesota pays no commissions, the VCS may then go ahea d andinstall its machines. Rather, the Panel said yes t o commissions and no to competin g VCS vending machines. The Panel's decision was the final word onwhat the VCS must do to comply with the Act. See § 107d-1(b).

The VCS is no different from any other steward of federa l propert y. If the VCS wants to impose limitations on a blin d
ven dor's operation, it must get permission from the Secretary o f Edu cation. Of course, if the Secretary approves installation o f the VCS's vending machines, th e VCS need not share its income with the blind vendor. See § 107d- 3(d). We affirm the decision of the district court.

A true copy.

Attest:

CLERK, U.S. COURT OF APPEALS, EIGHTH CIRCUIT.