United States District Court, E.D. Missouri, Eastern Division
BOTTOMS FARM PARTNERSHIP, BELL FAMILY PARTNERSHIP, BELL PLANTING CO., and NEZ FARMS, INC., Plaintiffs,
UNITED STATES DEPARTMENT OF AGRICULTURE, RISK MANAGEMENT AGENCY, and FEDERAL CROP INSURANCE CORPORATION, Defendants.
MEMORANDUM AND ORDER
SHIRLEY PADMORE MENSAH UNITED STATES MAGISTRATE JUDGE
an action for judicial review of a final agency action under
the Administrative Procedure Act, 5 U.S.C. § 701, et
seq. This case is before the Court on the cross-motions
for summary judgment filed by Plaintiffs (Doc. 35) and
Defendants (Doc. 38). Both motions have been fully briefed,
and the Court has heard oral argument on them. The parties
have consented to the jurisdiction of the undersigned United
States Magistrate Judge pursuant to 28 U.S.C. §
636(c)(1). (Doc. 28). For the following reasons,
Defendants' motion will be granted, and Plaintiffs'
motion will be denied.
in this case are four entities that conduct farming
operations in Missouri: Bottoms Farm Partnership, Bell Family
Partnership, Bell Planting Co., and Nez Farms, Inc.
(collectively, “Plaintiffs”). Defendants in this
case are the United States Department of Agriculture
(“USDA”), the Risk Management Agency
(“RMA”), and the Federal Crop Insurance
Corporation (“FCIC”) (collectively,
“Defendants”). In their Complaint, Plaintiffs
seek a declaratory judgment and injunctive relief arising
from administrative determinations issued by FCIC and RMA.
Federal Crop Insurance Act (“FCIA”) was enacted
“to promote the national welfare by improving the
economic stability of agriculture through a sound system of
crop insurance and providing the means for the research and
experience helpful in devising and establishing such
insurance.” 7 U.S.C. § 1502(a). Defendant FCIC is
a federal government-owned corporation within the USDA that
was created to “carry out the purposes” of the
FCIA. 7 U.S.C. § 1503; 31 U.S.C. § 9101(3).
Defendant RMA is an agency of the USDA and is charged with
supervision of FCIC and with regulation and oversight of the
FCIA. 7 U.S.C. § 6933.
to the FCIA, FCIC is authorized to act as a reinsurer to
Approved Insurance Providers (“AIPs”). 7 U.S.C.
§ 1508. An AIP is “a private insurance provider
that has been approved by [FCIC] to provide insurance
coverage to producers participating in the Federal crop
insurance program established under this subchapter.” 7
U.S.C. § 1502(b)(2). “In order to qualify for
reinsurance through the FCIC, the policies written by [AIPs]
must comply with the FCIA and its accompanying
regulations.” Davis v. Producers Agric. Ins.
Co., 762 F.3d 1276, 1284 (11th Cir. 2014).
“Consequently, the FCIA generally establishes the terms
and conditions of insurance, . . . even though the crop
insurance policy is between the farmer and an [AIP].”
Id. (internal quotation marks omitted).
the time periods relevant to this litigation, Plaintiffs
conducted farming operations, including rice production, in
Stoddard County, Missouri. In 2012, each of the Plaintiffs
purchased federally reinsured policies of Multi-Peril Crop
Insurance that provided revenue protection coverage for their
2012 rice crop from Rural Community Insurance Services
(“RCIS”), an AIP. As an AIP, RCIS entered into a
Standard Reinsurance Agreement with FCIC.
policies issued to each Plaintiff, like other policies issued
under the Federal crop insurance program, include three sets
of provisions: (1) the Common Crop Insurance Policy Basic
Provisions (the “Basic Provisions”), which are
common to all crops and are codified in the Code of Federal
Regulations at 7 C.F.R. § 457.8 (2012); (2) the Rice
Crop Provisions, which are specific to the particular crop
that is being insured and that are codified in at 7 C.F.R.
§ 457.141 (2012); and (3) the “Special Provisions
of Insurance 2012 and Succeeding Crop Years for Stoddard
County, Missouri-Rice (“Special Provisions”),
” which govern rice grown in Stoddard County, Missouri
and are not codified in the Code of Federal Regulations.
issue in this case is the following provision, contained in
the Special Provisions:
. . .
In addition to the definition of Planted Acreage specified in
section 1 of the Crop Provisions, the following must have
occurred immediately following seeding. If these activities
have not occurred, the acreage will be considered
“acreage seeded in any other manner” and will not
1. levees are surveyed and constructed; 2. levee gates are
installed and butted; and 3. the irrigation pump is operable,
ready to be started in the event sufficient rainfall has not
been received, and turned on to provide sufficient water for
the purposes of germination or elimination of soil crusting.
result of substantial damage to their rice crop in 2012, each
of the Plaintiffs filed claims with RCIS for the 2012 crop
year. RCIS denied the Plaintiffs' claims on the ground
that the acreage was not insurable due to the alleged failure
to comply with the Special Provisions- specifically, the
failure to survey and construct levees immediately after
seeding and the failure to immediately fully install levee
gates following seeding.
disagreed with RCIS's interpretation of the Special
Provisions, and the parties entered into policy-mandated
arbitration pursuant to RMA Manager's Bulletin No.
MGR-12-003.1 and Section 20(a) of the Basic Provisions. The
arbitration proceedings have been consolidated and are being
held in abeyance pending the resolution of the issue
presented in this action.
20 of the Basic Provisions provides for mandatory arbitration
of disputes involving determinations made by an AIP.
Specifically, Section 20(a) provides:
[I]f you and we fail to agree on any determination made by us
. . ., the disagreement may be resolved through mediation in
accordance with Section 20(g). If resolution cannot be
reached through mediation, or if you and we do not agree to
mediation, the disagreement must be resolved through
arbitration in accordance with the rules of the American
Arbitration Association (AAA) . . .
(1) All disputes involving determinations made by us . . .
are subject to mediation or arbitration. However, if the
dispute in any way involves a policy or procedure
interpretation, regarding whether a specific provision or
procedure is applicable to the situation, how it is
applicable, or the meaning of any policy provision or
procedure, either you or we must obtain an interpretation
from FCIC in accordance with 7 CFR part 400, subpart X or
such other procedures as established by FCIC.
(i) Any interpretation by FCIC will be binding in any
mediation or arbitration.
(ii) Failure to obtain any required interpretation from FCIC
will result in nullification of any agreement or award.
(iii) Any interpretation by FCIC of a policy provision is
considered a determination that is a matter of general
(iv) Any interpretation by FCIC of a procedure may be
appealed to the National Appeals Division in accordance with
7 CFR part 11.
accordance with this provision, RCIS and Plaintiffs jointly
sought an interpretation of the Special Provisions from FCIC.
(AR 3-7). The joint request stated that the parties sought an
interpretation “in accordance with Bulletin
MGR-05-018.” (AR 3). Manager's Bulletin MGR-05-018
provides rules and procedures by which parties can obtain an
interpretation from FCIC, as required by Section 20(a), of
“procedure”; it does not expressly discuss how to
obtain an interpretation of a “policy provision.”
request for interpretation, RCIS asserted that the provision
of the Special Provisions at issue should be interpreted to
require that “a producer must, no later than
immediately following seeding of the fields, construct the
entire levee system for all of the fields including
preparation and installation of levee gates throughout all
fields.” (AR 6). Plaintiffs asserted that the provision
should be interpreted to “only require that such
levees, levee gates, and irrigation pumps as are required to
enable the producer to put sufficient water on the field in
the event it is needed for the purposes of germination or the
elimination of soil crusting be in place immediately
following seeding.” (AR 6).
December 17, 2014, RMA issued FCIC's interpretation of
the Special Provisions, in which it adopted RCIS's
interpretation (the “FCIC Interpretation”). (AR
9-13). It stated:
FCIC agrees with [RCIS's] interpretation. FCIC does not
agree with [Plaintiffs'] interpretation. Any time a term
is not defined in the policy, its common meaning is used and
that is found in any standard dictionary. The Merriam-Webster
dictionary defines “immediately” as
“without any delay.” This means the listed
activities must occur right after planting has ended, weather
permitting, without any delay. If weather prevents these
activities, they must commence as soon as the weather
Therefore, FCIC does not agree with [Plaintiffs']
interpretation that the Special Provisions only require that
such levees, levee gates, and irrigation pumps as are
required to enable the producer to put sufficient water on
the field in the event it is needed for purposes of
germination or the elimination of soil crusting, be in place
immediately following seeding. FCIC also does not agree that
interior levees do not have to be installed immediately
following planting in order for the acreage to be insurable.
Special Provisions statement specifies what activities must
occur immediately following seeding, including:
1. levees are surveyed and constructed;
2. levee gates are installed and butted; and
3. the irrigation pump is operable, ready to be started in
the event sufficient rainfall has not been received, and
turned on to provide sufficient water for the purpose of