COMMONWEALTH OF MASSACHUSETTS


Suffolk, ss. Division of Administrative Law Appeals

Department of Public Health (DPH),
WIC Program

Petitioner

v. Docket No. PH-08-123

Shoukat & Saeed, Inc., d/b/a S & S Food Mart and
Saeed Rahman, Shoukat Hussain, and Milagros Perez,

Respondents

Appearance for Petitioner:

Peggy Wiesenberg, Esq.

Department of Public Health
250 Washington Street
Boston, Ma. 02108


Appearance for Respondent:

John E. Pearson, Esq.

73 State Street, Suite 101
Springfield, MA 01103

Administrative Magistrate:

Joan Freiman Fink, Esq.

DECISION

On January 28, 2008, the Petitioner, the Department of Public Health - WIC Program, issued a Notice of Termination of WIC Vendor Agreement for Fiscal Years 2007-2009 and Disqualification from the WIC Program for three years to the Respondents, Shoukat & Saeed, Inc., d/b/a S & S Food Mart, and Saeed Rahman, the owner of the store, Shoukat Hussain, the secretary and co-owner of the store, and Milagros Perez, the former manager of the store located at 61 - 67 Locust Street in Springfield, MA. (Exhibit 1). The Respondent filed a timely claim of an appeal of this termination and disqualification. (Exhibit 2). The case was referred for hearing to the Division of Administrative Law Appeals (DALA) and on March 19, 2008, a Notice was sent to the parties indicating that a Pre-hearing Conference would be held on April 28, 2008. This Pre-hearing Conference was continued as a result of a Joint Request from the parties. A second Pre-hearing Conference was scheduled for June 2, 2008. At that time, the Petitioner appeared but the Respondents failed to appear. On July 1, 2008, a decision was issued against the Respondents as a result of their failure to prosecute their claim of appeal . On July 30, 2008, the Respondents filed a Motion for Reconsideration. This Motion for Reconsideration was allowed and a Pre-hearing Conference was held on October 7, 2008. On November 19, 2008, a full hearing in this matter was held at the offices of DALA, 98 North Washington Street, 4th Floor, Boston, MA pursuant to 801 CMR 1.02, the Informal Rules of Procedure.

Various documents were entered into evidence at the hearing (Exhibits 1 - 22). Mary Blocksidge, the Vendor Manager for the Massachusetts WIC Program for the past twenty-two years, testified on behalf of the Petitioner as did the Compliance Buyer. Shoukar Hussain, Secretary and Co-Owner of S & S Food Mart, testified on behalf of the Respondent. One cassette tape recording was made of the hearing. At the outset of the hearing, the Parties presented thirty-one (31) Joint Stipulations of Fact.

FINDINGS OF FACT:

Based on the testimony and evidence presented, I make the following findings of fact:

1. The WIC Program is a special supplemental federal food program for women, infants, and children that is administered in Massachusetts for the U.S. Department of Agriculture by the DPH in accordance with 42 U.S.C. 1786 and 7 CFR 246. (Joint Stipulation #1).

2. All potential WIC Program Vendors have to meet certain criteria in order to be selected as a Vendor. These criteria are outlined in the Vendor Application Packet that is given to each applicant who desires to participate in the WIC Program. (Joint Stipulations #6 & 7).

3. After being selected as a participant in the WIC Program, a Vendor must undergo a specified training program including a detailed review of the regulations outlined in the Vendor Agreement. (Joint Stipulation #7).

4. In January of 2006, Saeed Rahman, President of Shoukat & Saeed, Inc., d/b/a/ S & S Food Mart, submitted an application for approval as a W.I.C. vendor. This application was approved and Shoukat & Saeed, Inc., d/b/a S & S Food Mart, entered into a Vendor Agreement with the Massachusetts WIC Program for the period of April 27, 2006 through September 30, 2007. The Vendor Agreement with Shoukat & Saeed, Inc., d/b/a S & S Food Mart was subsequently renewed for the period of 2007 - 2009. By signing this WIC Vendor Agreement, S & S Food Mart agreed to comply with the procedures and regulations specified in the Agreement Document. (Joint Stipulations #17- 22).

5. Section 1 and 2 of the Vendor Agreement provide that the Vendor agrees to have the store manager and all other authorized employees of the store participate in required training programs at which WIC procedures and requirements are taught (Joint Stipulation #21).

6. Section 6 of the WIC Vendor Agreement with Shoukat & Saeed, Inc., d/b/a S & S Food Mart states: "Follow WIC check pricing procedures as established by Federal and State requirements: (b) Write in the space provided on the WIC check a price no higher than the actual, current shelf price of only those WIC products authorized on the WIC check and actually purchased by the authorized WIC shopper." (Exhibit 3).

7. Section 6 (g) of the WIC Vendor Agreement with Shoukat & Saeed, Inc., d/b/a S & S Food Mart provides as follows: "Do not price WIC transactions by check type instead of pricing each check for the actual, authorized WIC products purchased and received." (Exhibit 3).

8. Section 5(e) of the WIC Vendor Agreement with Shoukat & Saeed, Inc., d/b/a Food Mart provides as follows: "Observe the authorized WIC shopper as she/he signs the WIC check, and be sure the signature on the WIC check matches the authorized signature in the WIC ID folder on the official Massachusetts WIC ID card …" (Exhibit 3).

9. Section 6(h) of the WIC Vendor Agreement with Shoukat & Saeed, Inc., d/b/a Food Mart provides that: "Fill in the WIC check only in the presence of the authorized WIC shopper after the authorized WIC shopper has obtained the WIC products and before the authorized WIC shopper has signed the WIC check; ensure that the authorized WIC shopper signs the WIC check only after the Vendor personnel fills in the WIC check price." (Exhibit 3).

10. On October 8, 2007, a compliance buyer for the WIC Program as part of her assigned duties visited the S & S Food Mart. She was given two authorized checks: one to make specific purchases of milk, cereal and juice boxes and the other to purchase milk, cheese, beans, and juice. (Testimony of the compliance buyer, Exhibit 7).

11. The prices of the items that the compliance buyer purchased that day were $8.37 and $10.76, respectively. However, the vendor at S & S Food Mart submitted these checks for payment with prices of $24.92 and $15.75 written in, resulting in an overcharge of $21.54. (Testimony of the compliance buyer, Exhibit 7).

12. On October 17, 2007, the compliance buyer made a second visit to S & S Food Mart. On that day, for the checks used by the buyer, the prices of authorized WIC food items actually purchased were $14.35 and $11.56 respectively. However, the vendor submitted these checks for payment with prices of $24.92 and $15.85 written in, resulting in an overcharge of $14.86. (Testimony of the compliance buyer, Exhibit 10).

13. On October 30, 2007, the compliance buyer made a third visit to S & S Food Mart. On that day, the prices of the authorized WIC food items actually purchased by her were $16.35 and $11.56 respectively. However, the vendor submitted these checks for payment with prices of $24.92 and $15.85 written in, resulting in a total overcharge of $12.86. (Testimony of the compliance buyer, Exhibit 13).

14. On November 15, 2007, the compliance buyer made a fourth and final visit to S & S Food Mart. On that day, the prices of WIC food items actually purchased by her were $16.95 and $11.56 respectively. However, the vendor submitted these checks for payment with prices of $25.22 and $15.85 written in, resulting in a total overcharge of $12.56. (Testimony of the compliance buyer, Exhibit 16).

15. Four different cashiers working at S & S Food Mart waited on the compliance buyer on each of her visits in October and November of 2007. On each of these visits, the cashiers asked the compliance buyer to sign the checks without ensuring that the signature on the WIC checks matched the authorized signature in the WIC ID folder. (Testimony of the compliance buyer).

16. On each of the four visits made, the compliance buyer was not asked for her WIC identification card nor did the cashier calculate the total amount of the items that were purchased. The cashier also failed to fill in the amount of the purchase in her presence before the compliance buyer had countersigned the WIC check (Testimony of the compliance buyer).

17. On the fourth visit, the compliance buyer was unable to locate a price on the cartons of milk. (Testimony of the compliance buyer).

18. On January 28, 2008, DPH sent the Respondent, Shoukat & Saeed, Inc., d/b/a S & S Food Mart and Saeed Rahman, President and owner, Shoukat Hussain, Secretary and Owner, and Milagros Perez, Manager, a Notice of Termination of WIC Vendor Agreement for Fiscal Year 2007-2009 and Disqualification from the WIC Program for three years (Exhibit 1).

19. On February 15, 2008, Shoukat & Saeed, Inc. d/b/a S & S Food Mart, Mr. Saeed Rahman, President Owner, Mr. Shoukat Hussain, Secretary, Owner, and Milagros Perez, Manager filed an appeal of that decision and requested an adjudicatory hearing (Exhibit 2).

CONCLUSION

After reviewing the testimony and evidence presented, I conclude that the DPH was fully justified in its decision to terminate the Vendor Agreement for Shoukat & Saeed, Inc. d/b/a S & S Food Mart from the WIC Program for a period of three years.

Section 6 of the WIC Vendor Agreement with Shoukat & Saeed, Inc., d/b/a S & S Food Mart provides as follows: "Follow WIC check pricing procedures as established by Federal and State requirements: (b) Write in the space provided on the WIC check a price no higher than the actual, current shelf price of only those WIC products authorized on the WIC check and actually purchased by the authorized WIC shopper." Section 6(g) provides that: "Do not price WIC transactions by check type instead of pricing each check for the actual, authorized WIC products purchased and received."

By overcharging the WIC Program by writing on checks amounts that are higher than the actual price of the products purchased on at least four separate occasions in October and November of 2007, S & S Food Mart violated Section 6(b) of the WIC Vendor Agreement. By charging an authorized shopper (the compliance buyer) a set price by check type instead of pricing each check for the actual items purchased, S & S Food Mart violated Section 6(g) of the WIC Vendor Agreement.

Section 5(e) of the WIC Vendor Agreement provides that the vendor must "observe the authorized WIC shopper as she/he signs the WIC check, and be sure the signature on the WIC check matches the authorized signature in the WIC ID folder on the official Massachusetts WIC ID card …" By failing to observe the compliance buyer sign the WIC check and ensure that the signature on the WIC check matches the authorized signature in the WIC ID folder, S & S Food Mart violated Section 5(e) of the WIC Vendor Agreement.

Section 6(h) of the WIC Vendor Agreement provides that the Vendor must: "Fill in the WIC check only in the presence of the authorized WIC shopper after the authorized WIC shopper has obtained the WIC products and before the authorized WIC shopper has signed the WIC check; ensure that the authorized WIC shopper signs the WIC check only after the Vendor personnel fills in the WIC check price."
By failing to calculate the total amount of the items that were purchased by the compliance buyer and further by failing to fill in the amount of the purchase in her presence before she had counter-signed the WIC check, S & S Food Mart violated Section 6(h) of the WIC Vendor Agreement.

The Respondent argues that the compliance buyer's testimony is not credible. Since the Petitioner's case is primarily predicated on the testimony of the compliance buyer, the Respondent argues that the Department of Public Health has not met its burden of proof with respect to the allegations against S & S Food Mart.

Notwithstanding the Respondent's argument, I found the testimony of the compliance buyer to be convincing and persuasive and I fully credited her testimony with respect to the various violations of the WIC Vendor Agreement committed by S & S Food Mart during her four visits to the store. The compliance buyer had no reason to fabricate her testimony or to dissemble. She testified that she was paid a salary and that the salary did not vary depending on whether she found a violation of the WIC Regulations. The compliance buyer was not familiar with any of the principals of S & S Food Mart and had no discernible bias towards them or their store. Moreover, the Respondent offered no reasonable explanation for its assertion that the compliance buyer was not credible other than some vague reference to the fact that during the course of her life, she may have told some lies. Since the majority of people have told some lies throughout the course of their lives, to exclude the testimony of a witness on that premise alone would have a chilling effect on the entire administrative and judicial process.

Accordingly, I conclude that sanctions must be imposed in accordance with both Federal and Massachusetts Regulations. Consistent with Federal regulations that govern vendor disqualification from the WIC Program, 7 CFR 246.12, the Massachusetts WIC Program has classified violations into several different categories: Class I, Class II, Class III, and Class IV. Appendix A of the WIC Vendor Agreement with S & S Food Mart lists which violations fall into the various categories. The violations committed by overcharging the WIC Program and charging the WIC Program a set price by check type instead of pricing each check for the actual items purchased constitute Class II violations of the Agreement. Failing to observe the authorized WIC shopper sign the check as well as failing to ensure that the signature on the WIC check matches the authorized signature in the WIC ID folder constitute Class IV violations of the Agreement. The Agreement specifically provides that: "vendors who commit a Class II Violation shall be disqualified from the WIC Program for three (3) years."

Mary Blocksidge, an employee of the WIC Program in Massachusetts for the past twenty-two years, gave credible testimony to the effect that the success of the WIC Program is largely dependent on the reliability and integrity of its Vendors. Thus, it is extremely important that the WIC Program have utmost confidence in the individuals who have been selected as WIC Program Vendors. In light of the fact that S & S Food Mart has committed multiple Class II and Class IV Violations of the WIC Vendor Agreement, violations which are serious and undermine the integrity of WIC Program, the DPH was fully warranted in imposing the sanctions outlined in the Agreement. Accordingly, the decision of DPH to terminate S & S Food Mart's WIC Vendor Agreement for Fiscal Years 2007-2009 and to disqualify Mr. Saeed Rahman, Mr. Shoukat Hussain, and Mr. Milagros Perez from participation in the WIC Program for a period of three years is affirmed.

SO ORDERED.


DIVISION OF ADMINISTRATIVE LAW APPEALS

/s/ Joan Freiman Fink
Administrative Magistrate

Dated: March 19, 2009