Court Opinion

ID: 4959510
Source: CourtListenerOpinion
Date Created: 2021-09-24 14:21:08.19582+00
Date Added: 2024-06-11T08:15:45.380111
License: Public Domain

DISSENTING OPINION BY
JUDGE SMITH-RIBNER.
I respectfully dissent from the Majority’s decision to affirm the order of the Department of Health to decertify P & C # 139 as a vendor under the WIC Program (Special Supplemental Food Program for Women, Infants and Children). The Department’s order was based upon regulations that it promulgated after this Court’s decision in Giant Food Stores, Inc., Store No. 18 v. Department of Health (Giant I), 123 Pa.Cmwlth.418, 554 A.2d 174 (1989), which reversed the Department’s decertification of a WIC Program vendor in that case. The Court ruled that no basis existed for distinguishing between a one-time food product shortage during the Department’s routine store review and a one-time shortage discovered during a vendor’s recertification review for purposes of imposing sanction. Neither Giant I nor applicable federal regulations support or mandate vendor decertification for a first offense, one-time food product shortage as the Department claims.
The Majority opinion as well as the Court’s decision in Giant Food Stores, LLC v. Department of Health (Giant II), 808 A.2d 299 (Pa.Cmwlth.2002), make much of the fact that no Department regulations existed at the time of Giant I and therefore that the Department was at liberty to ignore Giant I when the Department promulgated its regulations regarding selection and management of WIC vendors and when it decertified P & C some five months prior to the decision in Giant II. First, I disagree that the Department was at liberty to ignore this Court’s decision in Giant I, and secondly I believe that Giant II was incorrectly decided, that it was contrary to prior precedent and to federal regulations and that it should be overruled. In Giant II the Court noted that during an announced re-certification review the vendor is not provided with an opportunity to correct any deficiency that may exist in the store’s inventory. 28 Pa.Code § 1103.1(f). The Court justified the distinction made by the Department between routine reviews and recertification inspections based on the purportedly differing purposes of the reviews and on the general premise that the Department is entitled to great deference in the interpretation of its own regulations. Most importantly, however, the Court in Giant II and the Majority here failed to consider all applicable federal regulations governing vendor sanction.
Federal regulations govern the special supplemental nutrition program for women, infants and children, and they require mandatory disqualification of vendors under specified circumstances. According to 7 C.F.R. § 246.12(J )(1) (mandatory vendor sanctions), the Department must permanently disqualify a vendor for conviction of trafficking in food instruments or selling firearms. The Department must disqualify a vendor for one year for a pattern of providing unauthorized food items in exchange for food instruments; for three years for one incidence of a sale of alcohol or alcoholic beverages or tobacco products in exchange for food instruments or for a *886pattern of vendor overcharges or providing credit or non-food items in exchange for food instruments;1 and for six years for one incidence of buying/selling food instruments for cash or selling firearms, ammunition, explosives or controlled substances in exchange for food instruments.
State agencies may disqualify a vendor who committed prior multiple violations as well, and they may impose sanctions for violations not specified above so long as the violations and the sanctions are contained in the state’s sanction schedule. The sanctions may include disqualification, civil money penalties in lieu of disqualification and administrative fines. 7 C.F.R. § 246.12(7 )(2)(i). Moreover, the regulations refer throughout to the need for state agencies to ascertain whether vendor disqualification would cause inadequate participant access. See, e.g., Section 246.12(g)(3)(iii), (l)(l )(ix), (l)(2)(iii)(B).
Nowhere in the applicable federal regulations is there a mandate that state agencies must decertify a vendor for a first-time food shortage as the Department has contended and as the Majority has held. The Majority cites Section 246.12(g)(3)(ii) to support its conclusion that decertification is mandated. Specifically, that section provides that a “State agency may not authorize a vendor applicant unless it determines that the vendor applicant meets these minimums [for variety and quantity of supplemental foods].” Slip op. at 7, n6. I disagree that this language manifests a federal requirement for mandatory disqualification of a vendor such as the one involved here who, absent prior violations, has five cans of Isomil on its shelf instead of the required- six at the time of the recertification inspection. I note the provision immediately following the one cited by the Majority that requires state agencies to determine whether denying authorization would result in inadequate participant access.2 Section 246.12(g)(3)(iii).
As the Court’s decision in Giant II was contrary to applicable federal regulations and the whole purpose behind WIC Program vendor monitoring, I would overrule that decision. In fact, in Giant II the Court expressly noted the purpose behind the federal vendor monitoring regulations, which is to guarantee that vendors comply with applicable federal and state regulations, to provide a means for the Department to identify problems and to assist vendors in correcting those problems and to allow the Department to take action against vendors who fail to correct their problems or who engage in fraudulent or abusive behavior. While I do not condone any situation in which a vendor does not provide adequate food supply for every WIC Program participant on any given day, I likewise do not agree with the Ma*887jority which places an interpretation upon the federal regulations which is neither consistent with the purposes behind WIC Program vendor monitoring/recertification nor is expressly intended by the regulations.
Lastly, I believe that another significant basis exists for rejecting the Department’s arguments and reversing its order. I note that the Majority declined to address P & C’s collateral estoppel arguments because the unreported decision in Bi-Lo # 299 v. Department of Health, Division of Special Food Programs (WIC) (Cmwlth. Ct., No. 1716 C.D.2000, filed August 16, 2001), appeal denied, 568 Pa. 740, 798 A.2d 1291 (2002), that P & C cited is not related to the case sub judice and may not be cited as representing the law of the case.3 P & C relies on another unreported decision in Insalcos # 379 v. Department of Health, Division of Special Food Programs (WIC) (Cmwlth. Ct., No. 2263 C.D.1997, filed April 13, 1998). Both decisions follow the reasoning of Giant I and recognize that no basis existed for making a distinction between a one-time food shortage during a routine review resulting in a warning and further reviews and training and a onetime shortage during a recertification inspection resulting in automatic disqualification. Indeed, under the Department’s view a high-risk vendor who committed multiple and serious infractions during the contract period would receive less severe sanction than an exemplary vendor with a one-time offense of a food product shortage discovered during a recertification inspection.
The hearing examiner found that all three of the stores, Bi-Lo, Insalcos and P & C, are owned and operated by Penn Traffic Corporation, see Finding of Fact 19, and as P & C indicates the Department was the respondent in each of the cases and had a full opportunity to litigate the identical issues presented here. In addition, the Supreme Court denied allocatur review in Bi-Lo # 299. P & C argues that collateral estoppel therefore applies to foreclose the Department’s relitigation of the same issue in this case. That doctrine applies when the following factors have been satisfied: identical legal and factual issues have been litigated to final judgment; the party against whom the doctrine is asserted was a party to the prior litigation; and the party had a full and fair opportunity to litigate the issues. Roman v. Jury Selection Commission of Lebanon County, 780 A.2d 805 (Pa.Cmwlth.2001). It is only necessary that the party against whom the doctrine is asserted, the Department, was a party to the prior actions. Id.
The Court’s decisions in Bi-Lo #299 and in Insalcos # 379 as well as in Giant I dealt with the precise legal and factual issue presented in the case sub judice, i.e., whether the Department may decertify a vendor for a one-time food product shortage discovered during a recertification review. The cases were litigated to final judgment. The Department was a party to the litigation in all of the cases, and the Department had a full and fair opportunity to litigate the issue presented. In fact, Bi-Lo # 299 and Insalcos # 379 involved the Department, the same store owner and the same attorneys. Consequently, the *888Court’s internal operating procedures do not preclude P & C from citing and relying on these cases to support its collateral estoppel arguments. See Commonwealth v. Kelliher, 325 Pa.Super. 228, 472 A.2d 1091 (1984). The Department, accordingly, should be estopped from relitigating the issue that the Court had already decided to final judgment prior to the Department’s decertification order. Hence, I would reverse.
President Judge Colins and Judge McGinley join in this dissent.

. See, e.g., Barakat v. Wisconsin Department of Health and Social Services, 191 Wis.2d 769, 530 N.W.2d 392 (Ct.App.1995) (court held that state agency disqualification of WIC Program vendor for three years was proper after vendor pled guilty to federal criminal charges of submission of false claims following state and federal investigation of several vendors for possible fraud); Crystal Food and Liquor, Inc. v. Howard Consultants, Inc., 276 Ill.App.3d 504, 213 Ill.Dec. 258, 658 N.E.2d 1279 (1995) (court upheld vendor disqualification where pattern of overcharging constituted serious and repeated abuse of the WIC Program). Compare So v. Ledbetter, 209 Ga.App. 666, 434 S.E.2d 517 (1993) (court reversed vendor disqualification where one-time inadvertent overcharge occurred and would require same sanction as multiple intentional overcharges, and state agency procedures did not allow for consideration of undue hardship placed on participants in the event of disqualification).

. The hearing examiner found that two other stores were available to WIC Program participants within 2.6 miles. Finding of Fact 13.

. In Commonwealth v. Kelliher, 325 Pa.Super. 228, 472 A.2d 1091 (1984), the court stated what is now a well-settled concept, i.e., that a memorandum opinion is not to be cited as binding precedent. However, that does not eliminate the memorandum opinion’s legitimacy or validity, and it shall have the "same force and effect as if it were authored and is controlling as to the facts of that case and is the law of the case until overruled, either by a court en banc or the Pennsylvania Supreme Court.” Id. at 1095.