The Issue This issues in this proceeding are whether Respondent, in violation of Chapter 509, Florida Statutes (2004), committed acts alleged in the Administrative Complaint dated April 16, 2004, and, if so, what disciplinary action should be taken against the license held by Respondent.
Findings Of Fact Based upon observation of the witnesses and their demeanor while testifying in person and the documentary materials received in evidence, stipulations by the parties, evidentiary rulings made during the final hearing, and the entire record compiled herein, the following relevant and material facts are found: At all times material hereto, Respondent, Bacco's Restorante Italliano, a food service and eating establishment, was licensed and regulated by Petitioner, Department of Business and Professional Regulation, Division of Hotels and Restaurants, having been issued license number 6804773-R, type 2010, a Permanent Food Service license. Respondent's facility is located at 23 North Lemon Avenue, Sarasota, Florida. Andrea Posani testified that he was a "party of interest" in the proceeding because he had a financial interest in Bacco's Restorante Italliano, a food service and eating establishment, and he possessed authority to speak on behalf of (and represent) Respondent, Bacco's Restorante Italliano, licensee. Petitioner's witness, Daniel Erdman, deputy district manager (for three months) and senior sanitation safety specialist for the preceding five years (1999 through 2004) in Manatee and Sarasota counties, earned his Bachelor of Science degree from Florida State University with a major in hospitality administration. Mr. Erdman conducts more than 1,500 inspections annually. Mr. Erdman described a "critical violation" in the food business as violation of any of the Florida Statutes, the Florida Administrative Code rules, and the Food Code, that "has more of a potential for food borne ailments." Mr. Erdman has been Petitioner's inspector of Respondent's business for more than four years in both locations, first, on Main Street and, now, on Lemon Street, in Sarasota, Florida. Mr. Erdman, on March 1, 2004, inspected Respondent's business, noted violations on DBPR Form HR 5022-014 that was signed by Mr. Erdman and Claudia Zecchin-Moschini (Claudia Zecchin at the time of signing), and a copy was given to Ms. Zecchin-Moschini. Thereon was the "callback date/time that informs Respondent of both the time to correct noted violation(s) and the inspection return date. The Administrative Compliant alleged the following critical violations of Chapter 509, Florida Statutes (2003), Florida Administrative Code, and/or rules of the Division of Hotels and Restaurants noted during the March 1, 2004, inspection: 27-22 5-202.12 FC Handwashing Facility, Installation. (A) A handwashing lavatory shall be equipped to provide water at a temperature of at least . . . (110 degrees Fahrenheit) through a mixing valve or combination faucet. (B) A steam mixing valve may not be used at a handwashing lavatory. (C) A self-closing, slow-closing, or metering faucet shall provide a flow of water for at lease 15 seconds without the need to reactivate the faucet. (D) An automatic handwashing facility shall be installed in accordance with manufacturer's instructions. Observed no cold water provided at handsink (Bar) 2. 31-10 5-204.11 & 6-401.10 FC Handwashing Facility. Conveniently Located. A handwashing facility shall be located: (A) To allow convenient use by employees in food preparation, food dispensing, and warewashing areas; and (B) in, or immediately adjacent to, toilet rooms. Observed missing handsink at dishwashing machine/cold prep area (removed) 3. 31-10 5-204.11 & 6-401.10 FC Handwashing Facility. Conveniently Located. A hadwashing facility shall be located: (A) To allow convenient use by employees in food preparation, food dispensing, and warewashing areas; and (b) in, or immediately adjacent to, toilet rooms. Observed no handsink provided in prep area, bread station service area in dining room without a handwashing sink. Bread station was removed from dining room on 3.15.2004 on reinspection evidence of bread station observed on 4.02.04 4. 53B-01 509.049 FS Food Service Employee Training. The Division shall adopt, by rule, minimum food safety protection standards for the training of all food service employees who are responsible for the storage, preparation, display, or serving of foods to the public in establishment regulated under this chapter. These standards shall not include an examination, but shall provide for a food safety training certificate program for food service employees to be administered by a private nonprofit provider chosen by the Division. Any food safety training program established and administered to food handler employees prior to the effective date of this act shall be submitted by the operator to the Division for its review and approval. It shall be the duty of the licensee of the public food service establishment to provide training in accordance with the described rule to all employees under the licensee's supervision or control. The licensee may designate a certified food service manager to perform this function as an agent of the licensee. Food service employees must receive certification pursuant to this section by January 1, 2001. Food service employees hired after November 1, 2000, must received certification within 60 days after employment. Certification pursuant to this section shall remain valid for 3 years. Observed no proof or required employee training 11 employees over 60 days employed (Reihou, Terrence, Paolo) [Emphasis added] Mr. Erdman, on March 15, 2004, returned and inspected the facility, finding violations 27-22, 31-10, and 45-14. These violations were granted time extension for correction to April 2, 2004. Mr. Erdman returned on April 2, 2004, and inspected the facility, identifying seven violations (two 27-22s, three 31- 10s, and two 53B-01s). During this reinspection, Mr. Erdman entered, in the comment section of his inspection report "note plumber scheduled for sink installation, water to bar tomorrow. Employee food safety training booklets ordered [training not completed]. Bread baskets, plated [sic], bread warmer, crumbs etc. observed in dining area/no hand sink provided." This report was not a warning as were the prior inspection reports; this report recommended filing of an administrative complaint. Respondent's witness, Ms. Zecchin-Moschini, when asked by Respondent, could not recall circumstances pertaining to each alleged violation. Her answers, on both direct and cross examinations, consisted primarily of "I don't remember," on four separate occasions. "I don't remember" is the answer given when Ms. Zecchin-Moschini was asked about the location of the sink and the present location of the beer cooler. This witness acknowledged that she did not have food management training: Yes, I don't have the training for these people. They were being coming from another restaurant, working there for a couple years, and I didn't ask them if they have any. I never got it. The only one that was there was Paolo that he didn't have. Mr. Posani admitted having no personal knowledge of the sink location violation and having no personal knowledge regarding the food management training violations for three of his employees. The record was left open for ten days for post- hearing submission of documentation of training, and none was submitted at the entry of this Recommended Order. Mr. Posani offered no credible and material evidence that could be considered a legal challenge to violations itemized in the Administrative Complaint and established by Respondent's witness' unrefuted testimony and exhibits in evidence. Petitioner proved, by clear and convincing evidence, each specific allegation against Respondent contained in the Administrative Complaint filed in this cause. Petitioner's compliance with cited Florida Statutes and cited rules of the Florida Administrative Code permits the imposition of penalty against Respondent for violations hereinabove found.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law, it is RECOMMENDED that Petitioner enter a final order: Finding Respondent guilty of violating Subsection 509.049(5), Florida Statutes (2004), and Sections 5-202.12, 5-204.11, and 6-401.10 of the Food Code, incorporated by reference and applicable to Florida Administrative Code Chapters 61C-1, 61C-3, and 61C-4; and Imposing an administrative penalty in the amount of $250.00 per violation for a total penalty amount of $1,000.00, due and payable to: Division of Hotels and Restaurants, 1940 North Monroe Street, Tallahassee, Florida 32399-1011, within 30 calendar days of the date the final order is filed with the agency clerk. DONE AND ENTERED this 5th day of July, 2005, in Tallahassee, Leon County, Florida. S FRED L. BUCKINE Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 5th day of July, 2005. COPIES FURNISHED: Charles F. Tunnicliff, Esquire Department of Business and Professional Regulation 1940 North Monroe Street, Suite 60 Tallahassee, Florida 32399-2202 Andrea Posani 23 North Lemon Avenue Sarasota, Florida 34236 Geoff Luebkemann, Director Division of Hotels and Restaurants Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-0792 Leon Biegalski, General Counsel Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32399-2202
The Issue Whether Petitioner committed the violations set forth in the Administrative Complaint and, if so, what penalty should be imposed.
Findings Of Fact Petitioner, the Department of Business and Professional Regulation, Division of Hotels and Restaurants (Division), is a state agency charged with the duty and responsibility of regulating the operation of hotel and restaurant establishments pursuant to Section 20.165 and Chapter 509, Florida Statutes. Respondent is an eating establishment located in Bell, Florida. At all times material to the allegations of the Administrative Complaint, Respondent held license number 3100051 issued by the Division. Julianne Browning is an inspector employed by the Division. Ms. Browning has a bachelor's degree from Florida State University in hotel and restaurant administration. She has been employed by the Department of Business and Professional Regulation since 1990. Prior to that time, she worked for approximately 10 years in the field of public lodging and food service. She also has received training in laws and rules regarding public food service and lodging, as well as fire safety. On October 23, 2002, Ms. Browning conducted an inspection of Respondent's premises. Rita Martin was not on the premises at the time of the October 23, 2002 inspection. Christina Martin, Rita Martin's sister-in-law who also works at Respondent's establishment, signed for the inspection report. Ms. Browning subsequently discussed the investigation findings and report with Rita Martin. During the October 23, 2002 inspection, Ms. Browning observed flies in the kitchen. Having flies in the kitchen is a critical violation because flies carry germs and bacteria, posing a direct threat to the public's health. Ms. Browning also found that there was no proof that employees who had worked at Respondent's establishment for 60 days or more had received food training. This is a critical violation because employees need to be trained in the correct way to handle food and the required temperatures for food. Ms. Browning also observed tuna salad in the refrigerator at 45 degrees, which is considered an unsafe temperature. The inspection took place at 2:30 p.m. but Ms. Browning determined that the tuna salad was prepared at 9:00 a.m. Food kept out of temperature for more than four hours are potentially hazardous because the food begins to grow bacteria if left out of refrigeration for too long. Ms. Browning also observed coleslaw, tuna salad, and crab salad that were not date-marked. These types of prepared foods can only be held for seven days or they become potentially hazardous food. These foods need to be date- marked so one knows when they were made to then determine when the foods should be thrown away. Ms. Browning observed that the hood filters had a severe grease buildup. A severe grease buildup in the hood filter is an indication that the flue has a grease buildup, which is a fire hazard. Ms. Browning observed a black substance on the interior of the ice machine. She was uncertain as to what the black substance was but believed it to be mildew. Mildew is hazardous near food because it has spores which could fall into the ice. Ms. Browning observed recyclables not stored in a waste handling unit that is inaccessible to insects or rodents. She observed boxes kept either on the ground or in an open trailer. This is a hazard because all garbage, whether recyclables or other garbage, has to be in a container that protects against the entrance of rodents or flies, which could potentially come into the restaurant. Ms. Browning observed a light shield missing from the light in the dry storage area. This is potentially hazardous because if the light bulb broke, the glass could shatter with the potential of getting onto the food in the storage area. Ms. Browning observed that the fire suppression report for the hood over the cooking equipment was not available for review. Such reports are made when the fire extinguishing company comes to service the fire suppression system. The report is the only way a Division inspector can tell if there are any deficiencies that need to be corrected with the fire suppression system. Ms. Browning observed bulk rice with a handle-free bowl for dispensing. This is hazardous because it allows for bare hand contact with the food. Rita Martin offered mitigating circumstances regarding some of the deficiencies noted by Ms. Browning. Regarding the allegation of flies in the kitchen, the Martins built a screened-in porch to keep flies from coming into the restaurant. Further, they put fly machines at the front and back doors and a blower at the back door. According to Ms. Martin, it is rare for flies to get into the restaurant. When flies get into the restaurant, "we get rid of them" and that she "cannot remember the last time I saw a live fly in my restaurant, period." Regarding the allegation of lack of proof of employee training, only one employee had worked there more than 60 days at the time of the inspection. Ms. Martin did not post that employee's card because the employee did not want her social security number posted. Eventually, Ms. Martin "whitened out" the social security number to post it. In any event, the employee's card was not available at the time of the inspection as required. Regarding the allegation that prepared foods were out of temperature and not properly date-marked, she responded: We try to put our salads or whatever we're making in large containers so that they will cool quickly. The foods that were made that day were made--one of the foods were made at 9:00 a.m., which was the coleslaw and crab. The tuna was made at 2:00. That was one of the ones that was--I think it was the tuna that was out of temperature. It had not been made--think it was less than an hour old. Her assertion in this regard is accepted as credible. Regarding the allegation that the hood filters had a grease buildup, Ms. Martin acknowledged that the hoods needed cleaning and were cleaned approximately one month after the inspection. Ms. Martin denied the existence of any black buildup on he interior of the ice machine. She looked in the ice machine shortly after the inspection and did not see any black buildup. According to Ms. Martin, there is a lime build-up because of lime in their water, and it is brownish in color. Her assertion in this regard is accepted as credible. Regarding the allegation of recyclables not stored in a closed unit that is inaccessible to rodents or insects, Ms. Martin explained that only clean boxes are put in a trailer, garbage is put elsewhere. Ms. Martin denied the allegation that a light shield was missing from the light in the dry storage area. The light shield had just been replaced prior to the inspection and is transparent and difficult to see. The storage area is narrow and it is difficult to see in there. Her assertions in this regard are accepted as credible. Regarding the allegation that there was no fire suppression report, Ms. Martin asserted that Ms. Browning had not made it clear in the past as to what was required to be posted and available. Whether Ms. Browning verbally reminded Ms. Martin about this requirement or not, the report was not available as required. Regarding the allegation that a bowl was used to dispense bulk rice, Ms. Martin explained that the rice was in dry, not ready-to-eat, form and that everyone knows to use a scoop. However, she acknowledged that she was not there for the inspection and could not say for certain that there was not a bowl in the rice.
Recommendation Based upon the foregoing Findings of Fact and Conclusions of Law set forth herein, it is RECOMMENDED: That the Division enter a final order which confirms the violations found, dismisses the violations not found, imposes an administrative penalty in the amount of $1,000, and requires Respondent to attend a Hospitality Education Program. DONE AND ENTERED this 27th day of June, 2003, in Tallahassee, Leon County, Florida. BARBARA J. STAROS Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 SUNCOM 278-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 27th day of June, 2003. COPIES FURNISHED: Charles F. Tunnicliff, Esquire Department of Business and Professional Regulation 1940 North Monroe Street Tallahassee, Florida 32388-1015 Rita S. Martin Post Office Box 145 Bell, Florida 32619 Geoff Luebkemann, Director Division of Hotels and Restaurants Department of Business and Professional Regulations 1940 North Monroe Street Tallahassee, Florida 32399-0792 Hardy L. Roberts, III, General Counsel Department of Business and Professional Regulations 1940 North Monroe Street Tallahassee, Florida 32399-2202
The Issue Whether Respondent committed the violations set forth in the Administrative Complaint and, if so, what is the appropriate penalty that should be imposed.
Findings Of Fact Petitioner, the Department of Business and Professional Regulation, Division of Hotels and Restaurants (Division), is the state agency charged with the duty and responsibility of regulating the operation of hotel and restaurant establishments pursuant to section 20.165 and chapter 509, Florida Statutes. Respondent is an eating establishment located in Clermont, Florida. At all times material hereto, Respondent was licensed as a public food establishment by the Division. Cecelia Chiu has been employed by the Division for approximately nine years and is a Senior Sanitation and Safety Specialist. Prior to working for the Division, she owned a restaurant for about 15 years and was employed as a store manager and a district manager with Wendy’s restaurants. Ms. Chiu has received training in laws and rules regarding public food service and lodging, and continues to receive continuing education training on a monthly basis in this area. She is a Certified Food Manager and performs approximately 800 inspections annually. On June 5, 2013, Ms. Chiu performed a routine inspection of Respondent's premises. During the inspection, Ms. Chiu prepared, signed, and issued an inspection report setting forth the violations she observed. The inspection report was electronically prepared on an iPad by Ms. Chiu. Respondent's representative was present and signed the inspection report indicating receipt. Ms. Chiu informed Respondent about the violations found, noted the violations on the inspection report, and notified Respondent that the violations must be corrected by August 6, 2013. On August 9, 2013, Ms. Chiu performed a callback inspection of Respondent. During that inspection, she prepared and signed a callback inspection report, which was signed and received by Respondent's owner, Subra Deeb. Ms. Chiu made Respondent aware that some of the violations noted on the June 5, 2013, inspection report had not been corrected. On June 5, 2013, and again on August 9, 2013, Ms. Chiu observed ready-to-eat food, potentially hazardous food prepared onsite, not being date-marked. Ms. Chiu found this to be a violation because while refrigeration slows the growth of pathogens and microorganisms, it does not kill these organisms. In time, these microorganisms and pathogens will significantly grow and pose a risk to public health. Therefore, time marking is required to control this risk to public health. The Division has designated this violation as an intermediate violation.1/ On June 5, 2013, and again on August 9, 2013, Ms. Chiu observed an employee wearing jewelry, specifically a bracelet and a watch, while preparing food. Ms. Chiu explained that the construction of jewelry, such as a bracelet, inhibits these items from being thoroughly cleaned and sanitized. Additionally, the jewelry can act as a reservoir for microorganisms and pathogens. If an employee is wearing these items while preparing food, it can cross-contaminate the food. Also, pieces from the jewelry can fall into the food and become a physical hazard to public health. The Division has designated this as a basic violation.2/ On June 5, 2013, and again on August 9, 2013, Ms. Chiu observed no vacuum breaker was provided on the fitting/splitter on the hose bibb at the mop sink. Ms. Chiu explained that this is a violation because the open end of the hose attached to a hose bibb on a drinking water line may be dropped into a container filled with dirty water or contact a puddle of dirty water. The backflow prevention device prevents dirty water from being siphoned back into the drinking water system if negative pressure occurs. The Division has designated this as a High Priority Item.3/ On June 5, 2013, and again on August 9, 2013, Ms. Chiu observed the carbon dioxide tank not adequately secured. Ms. Chiu explained that this is a violation because gas inside a tank, even if the tank is empty, must be properly secured because someone can knock it down, creating a missile and, therefore, a public safety hazard. The Division designates this as a basic violation. On June 5, 2013 and again on August 9, 2013, Ms. Chiu observed no proof of required state-approved employee training was provided for any employees. This is a violation because all food service employees must be trained in personal hygiene and food-borne illness prevention in order to provide a clean and safe establishment for the public. The Division designates this as an intermediate violation. Respondent’s Response Regarding the alleged violation about food held more than 24 hours but not being properly date-marked, Respondent testified that the food served is prepped daily, and that they only use food the same day that it is prepped. The undersigned finds this testimony to be credible. As for the allegation that an employee wore jewelry (a bracelet and a watch), Ms. Deeb did not refute the allegation, but testified that Ms. Chiu came in the restaurant when Ms. Deeb was cooking, that she washed her hands and wore gloves at the time of the inspection, and that she wears gloves “all the time.” Regarding the alleged violation that there was no vacuum breaker on the hose bibb at the mop sink, Ms. Deeb explained that the vacuum breaker has been replaced. Respondent did not refute the allegation regarding the carbon dioxide tank not being adequately secured or the allegation regarding having no proof of required state-approved employee training. Ms. Deeb did explain that Respondent was a new business at the time of the inspections, that they were in the process of renovating, and that she had misplaced the notice of violations after the June 5, 2013 inspection.
Recommendation Upon consideration of the facts found and conclusions of law reached, it is RECOMMENDED that the Division enter a final order which confirms the violations found, and imposes an administrative fine in the amount of $750 due and payable to the Division of Hotels and Restaurants, 1940 North Monroe Street, Tallahassee, Florida 32399-1011, within 30 calendar days of the date the Final Order is filed with the Agency Clerk. DONE AND ENTERED this 31st day of March, 2014, in Tallahassee, Leon County, Florida. S Barbara J. Staros Administrative Law Judge Division of Administrative Hearings The DeSoto Building 1230 Apalachee Parkway Tallahassee, Florida 32399-3060 (850) 488-9675 Fax Filing (850) 921-6847 www.doah.state.fl.us Filed with the Clerk of the Division of Administrative Hearings this 31st day of March, 2014.
The Issue In their joint stipulation, the parties framed the issues for determination in Phase 1 of this proceeding as follows: Whether a reasonable trier of fact can infer from the "Phase 1 Evidence" that Petitioner committed the infraction of a pattern of overcharging. Whether the "Phase 1 Evidence," which is assumed to be admissible, true, and accurate, for purposes of Phase 1, is sufficient for the trier of fact to find that the Department has met its burden of proving by clear and convincing evidence that Petitioner engaged in a pattern of overcharging.
Findings Of Fact The evidence presented in Phase 1, which, as stipulated by the parties, has been deemed to be competent and admissible for purposes of Phase 1, together with the parties' joint statement of undisputed facts, established the facts that follow. The Dispute As a food vendor under contract with the Department, J&L is authorized to accept food checks from participants in the Special Supplemental Nutrition Program for Women, Infants and Children ("WIC")1 and to receive payment on these checks from the Department, which administers the program in Florida. In this case, the Department seeks to disqualify J&L from participating in the WIC program for a period of three years as a mandatory sanction for allegedly having committed a serious violation of the federal regulations, namely, engaging in a "pattern of overcharging." J&L denies the charge. Background On May 24, 2000, Jean H. Cesaire, as the owner and authorized representative of J&L, executed a written agreement with the Department (the "WIC Vendor Agreement") which, by its terms, took effect on May 18, 2000. Under the WIC Vendor Agreement, J&L agreed broadly to comply with all state and federal WIC program rules, regulations, policies, and applicable law, and generally, among other things, to accept WIC food checks from program participants, to "[c]harge WIC customers the same price or less than the price charged to other customers in the quantities specified on the food checks and to not charge the WIC program for food not received by the customer." For its part, the Department agreed, among other things, to pay J&L "the amounts on properly redeemed food checks upon compliance by the vendor with the conditions contained [in the WIC Vendor Agreement]." Participants in the WIC program purchase groceries with food checks (sometimes also called "food vouchers," "food instruments," or "WIC checks") that they are provided based on individual nutritional needs. Each food check——and there are a number of different types, numerically identified——describes the kind and quantity of items that my be bought with that particular check. All of the check types at issue in this case afford the participant a menu of selections from which to choose, some offering a wider variety of options than others. For example, check type 029 permits the participant to purchase as many as five separate foodstuffs (some being available in alternative forms, e.g. frozen or liquid) in amounts up to a stated maximum, as follows: milk (1.5 gallons or six cans evaporated or 6 quarts dry); cheese (up to one pound); juice (12 ounces frozen or one 46-ounce can/bottle); cereal (up to 36 ounces); and eggs (one dozen). Because, as the WIC Vendor Agreement directs, "[t]he vendor shall not require WIC customers to purchase all of the items prescribed on the WIC check," a participant is free to tender a check type 029 in payment for, say, three cans of evaporated milk and a half pound of cheese. Doing so, of course, would unwisely "leave money on the table," needlessly relinquishing available benefits, but this sort of "under-consuming" is theoretically possible. Consequently, check type 029 permits a large number of potential purchase combinations. Other check types offer fewer choices. Check type 301, for instance, authorizes the purchase of up to seven, one-ounce cans of concentrated liquid infant formula, the WIC customer's only choice (in addition to quantity) being that between the brands Good Start and Alsoy. The limited menu on this check will produce (at least in most instances, presumably) one of two purchase combinations: either seven cans of Good Start or seven cans of Alsoy. The possibility that a participant might buy, e.g., three cans of Good Start and four of Alsoy, however, together with the potential for under-consuming (i.e. buying fewer than seven cans), increase the number of purchase combinations. Under the WIC Vendor Agreement, J&L is required to "submit an accurately completed WIC Food Price List to the department or local WIC office upon request." On July 20, 2000, J&L provided such a list to the Department. The Florida WIC Program Food Price List that J&L furnished the Department (the "Price List") constituted a representation by J&L that it would charge WIC customers (and hence the WIC program) the prices stated therein. Although a maximum price is not printed on the food checks used in Florida, it is possible, using J&L's Price List, to determine the costliest purchase combination available under a particular check type when presented in J&L's store. Simply put, the most expensive possible purchase for a given check type comprises the largest allowable amount of the priciest form of each foodstuff prescribed on the check. The sum total of the respective prices of these items (as set forth in the Price List) equals the check's dollar-limit in J&L's store. The Charge and the Department's Theory By a letter addressed to Mr. Cesaire and dated November 20, 2000, the Department notified J&L of its intent to disqualify the vendor from participating in the WIC Program for a period of three years, based on J&L's allegedly having engaged in a pattern of overcharging.2 In pertinent part, the Department alleged: During a visit to your store on July 20, 2000, [an inspection of WIC checks] showed: You were systematically charging a fixed price——i.e. the highest amount allowed for reimbursement by the Department——regardless of what customers actually purchased, and You were systematically charging amounts that were higher than your shelf prices for WIC food items, as set forth in the [Price List]. . . . . Since that visit, an audit of WIC checks submitted for payment by your store revealed that you continued to overcharge the WIC Program by routinely charging a fixed price and by claiming reimbursement for WIC checks in amounts that exceed your stated food item prices. Although these allegations imply that the Department has direct proof that J&L both (a) systematically charged a "fixed price" and (b) routinely charged WIC participants amounts that exceeded the current contract prices, in fact it is undisputed that statement (b) is the ultimate factual determination that the Department draws from basic premise (a). That is, the Department has no direct evidence that J&L routinely charged WIC participants prices in excess of those stated in the Price List; rather, it possesses proof that J&L systematically charged the dollar-limit on purchases paid for with the various food check types at issue, and the Department considers this to be circumstantial evidence of the violation charged. Underscoring the foregoing point is this from the parties' statement of facts not requiring proof at trial: 26. The parties stipulate that there is no particular WIC check that can be identified as having been utilized in the commission of an "overcharge" in that there is no way to tell what a customer actually purchased during a particular WIC transaction.[3] (However, this should not be construed as an admission by [the Department] that [J&L] did not commit a pattern of overcharging by maximum pricing, which is a theory that views the checks [in question] as a whole and not individually.) At the core of the Department's case is a chart containing data derived from hundreds of individual WIC checks that the Department contends collectively demonstrate a pattern of overcharging. The parties call this chart the "Matrix," and it is reproduced in full below. J & L #4626 Check Type Date Cleared Number of Checks Amount Highest Price Lowest Price 29 7/11/00 1 $ 25.99 $ 25.98 $ 18.32 7/18/00 1 $ 25.99 7/25/00 1 $ 22.82 8/29/00 1 $ 22.82 10/10/00 2 $ 22.82 31 6/28/00 52 $ 16.93 $ 16.23 $ 15.03 7/11/00 16 $ 16.93 7/18/00 30 $ 16.93 7/25/00 37 $ 13.53 8/1/00 34 $ 16.23 8/8/00 47 $ 16.23 8/15/00 40 $ 16.23 8/22/00 42 $ 16.23 8/29/00 57 $ 16.23 9/12/00 1 $ 16.23 9/19/00 12 $ 16.23 9/26/00 1 $ 16.03 9/26/00 22 $ 16.23 10/2/00 59 $ 16.23 10/10/00 45 $ 16.23 10/17/00 1 $ 11.10 10/17/00 8 $ 16.23 10/23/00 64 $ 16.23 10/30/00 1 $ 12.72 10/30/00 47 $ 16.23 11/7/00 1 $ 12.23 11/7/00 76 $ 16.23 11/10/00 1 $ 14.23 11/10/00 3 $ 16.23 11/14/00 56 $ 16.23 11/15/00 1 $ 16.23 11/20/00 40 $ 16.23 11/28/00 31 $ 16.23 33 6/25/00 12 $ 10.49 $ 10.34 $ 9.45 7/11/00 5 $ 10.49 7/18/00 12 $ 10.49 7/25/00 15 $ 9.64 8/1/00 9 $ 10.34 8/8/00 13 $ 10.34 8/15/00 10 $ 10.34 8/22/00 16 $ 10.34 8/29/00 7 $ 10.34 9/12/00 5 $ 10.34 9/19/00 4 $ 10.34 9/26/00 1 $ 9.16 9/26/00 6 $ 10.34 10/2/00 15 $ 10.34 10/10/00 13 $ 10.34 10/17/00 13 $ 9.64 10/30/00 1 $ 6.64 10/30/00 1 $ 7.25 10/30/00 20 $ 9.64 11/7/00 12 $ 10.34 11/10/00 11 $ 10.34 11/14/00 17 $ 10.34 11/17/00 1 $ 7.47 11/20/00 21 $ 10.34 11/24/00 1 $ 7.16 11/28/00 1 $ 10.34 86 8/29/00 1 $ 13.95 $ 13.87 $ 13.27 9/19/00 1 $ 13.17 159 6/28/00 50 $ 7.96 $ 7.51 $ 6.75 7/11/00 18 $ 7.96 7/18/00 32 $ 7.96 7/25/00 39 $ 6.74 8/1/00 35 $ 7.51 8/8/00 50 $ 7.51 8/15/00 40 $ 7.51 8/22/00 44 $ 7.51 8/29/00 66 $ 7.51 9/12/00 9 $ 7.51 9/19/00 15 $ 7.51 9/26/00 26 $ 7.51 10/2/00 62 $ 7.51 10/10/00 49 $ 7.51 10/17/00 59 $ 7.51 10/18/00 1 $ 7.51 10/23/00 64 $ 7.51 10/30/00 1 $ 4.46 10/30/00 50 $ 7.51 11/7/00 48 $ 7.51 11/10/00 1 $ 7.47 11/14/00 59 $ 7.51 11/15/00 1 $ 7.51 11/20/00 45 $ 7.51 11/28/00 41 $ 7.51 160 7/18/00 1 $ 27.49 $ 30.16 $ 21.67 7/25/00 1 $ 24.20 8/1/00 3 $ 24.20 8/8/00 3 $ 24.20 8/15/00 1 $ 24.20 8/22/00 4 $ 24.20 8/29/00 4 $ 24.20 9/12/00 1 $ 24.20 9/19/00 1 $ 24.20 9/26/00 5 $ 24.20 10/2/00 5 $ 24.20 10/10/00 5 $ 24.20 10/17/00 2 $ 24.20 10/30/00 8 $ 24.20 11/7/00 4 $ 24.20 11/10/00 3 $ 24.20 11/14/00 6 $ 24.20 11/20/00 8 $ 24.20 11/28/00 1 $ 24.20 162 6/28/00 26 $ 30.49 $ 33.05 $ 27.77 7/11/00 11 $ 30.49 7/18/00 26 $ 30.49 7/25/00 26 $ 30.40 8/1/00 20 $ 30.40 8/8/00 28 $ 30.40 8/15/00 31 $ 30.40 8/22/00 19 $ 30.40 8/29/00 24 $ 30.40 9/12/00 6 $ 30.40 9/19/00 7 $ 30.40 9/26/00 14 $ 30.40 10/2/00 36 $ 30.40 10/10/00 23 $ 30.40 10/17/00 27 $ 30.40 10/23/00 38 $ 30.40 10/30/00 20 $ 30.40 11/7/00 18 $ 30.40 11/10/00 1 $ 30.40 11/14/00 38 $ 30.40 11/20/00 27 $ 30.40 11/28/00 16 $ 30.40 201 7/11/00 1 $ 23.90 $ 21.00 $ 20.30 7/18/00 2 $ 23.90 7/25/00 2 $ 21.00 8/1/00 8 $ 21.00 8/8/00 5 $ 21.00 8/15/00 3 $ 21.00 8/22/00 11 $ 21.00 8/29/00 1 $ 21.00 9/19/00 1 $ 21.00 9/26/00 3 $ 21.00 10/2/00 6 $ 21.00 10/10/00 4 $ 21.00 10/17/00 7 $ 21.00 10/23/00 5 $ 21.00 11/7/00 9 $ 21.00 11/10/00 5 $ 21.00 11/14/00 3 $ 21.00 11/15/00 1 $ 21.00 11/20/00 10 $ 21.00 11/28/00 5 $ 21.00 202 7/18/00 2 $ 50.80 $ 45.00 $ 43.50 8/1/00 3 $ 45.00 8/8/00 5 $ 45.00 8/15/00 7 $ 45.00 8/22/00 6 $ 45.00 8/29/00 5 $ 45.00 9/12/00 1 $ 45.00 9/26/00 3 $ 45.00 10/2/00 4 $ 45.00 10/10/00 5 $ 45.00 10/17/00 5 $ 45.00 10/23/00 6 $ 45.00 11/7/00 6 $ 45.00 11/10/00 7 $ 45.00 11/14/00 5 $ 45.00 11/20/11 4 $ 45.00 11/28/00 8 $ 45.00 203 7/11/00 3 $ 54.80 $ 48.89 $ 47.19 7/18/00 5 $ 54.80 7/25/00 1 $ 48.89 8/1/00 5 $ 48.89 8/8/00 8 $ 48.89 8/15/00 10 $ 48.89 8/22/00 10 $ 48.89 8/29/00 7 $ 48.89 9/12/00 3 $ 48.89 9/19/00 2 $ 48.89 9/26/00 7 $ 48.89 10/2/00 7 $ 48.89 10/10/00 7 $ 48.89 10/17/00 9 $ 48.89 10/23/00 7 $ 48.98 10/30/00 8 $ 48.89 11/7/00 8 $ 48.89 11/10/00 3 $ 48.89 11/14/00 6 $ 48.89 11/20/00 6 $ 48.89 11/28/00 14 $ 48.89 204 7/11/00 1 $ 53.80 $ 48.00 $ 46.40 7/18/00 5 $ 53.80 7/25/00 3 $ 48.00 8/1/00 9 $ 48.00 8/8/00 11 $ 48.00 8/15/00 9 $ 48.00 8/22/00 17 $ 48.00 8/29/00 6 $ 48.00 9/12/00 1 $ 48.00 9/19/00 1 $ 48.00 9/26/00 5 $ 48.00 10/10/00 18 $ 48.00 10/17/00 15 $ 48.00 10/23/00 10 $ 48.00 10/30/00 3 $ 48.00 11/7/00 15 $ 48.00 11/10/00 11 $ 48.00 11/14/00 9 $ 48.00 11/20/00 13 $ 48.00 11/28/00 15 $ 48.00 205 7/11/00 3 $ 59.71 $ 53.58 $ 51.78 7/18/00 4 $ 59.71 7/25/00 2 $ 53.58 8/1/00 4 $ 53.58 8/8/00 8 $ 53.58 8/15/00 11 $ 53.58 8/22/00 6 $ 53.58 8/29/00 7 $ 53.58 9/12/00 2 $ 53.58 9/19/00 2 $ 53.58 9/26/00 7 $ 53.58 10/2/00 10 $ 53.58 10/10/00 3 $ 53.58 10/17/00 8 $ 53.58 10/23/00 8 $ 53.58 10/30/00 8 $ 53.58 11/7/00 7 $ 53.58 11/10/00 2 $ 53.58 11/14/00 6 $ 53.58 11/15/00 1 $ 53.58 11/20/00 7 $ 53.58 11/28/00 15 $ 53.58 The Matrix shows that for about a four month period, from August through November 2000, a high percentage of the WIC check types 029, 031, 033, 086, 159, 160, 162, 201, 202, 203, 204, and 205 that J&L submitted for payment were written at the particular check's dollar-limit. Two explanations for this phenomenon come readily to mind: Either, in these hundreds of transactions, the individual WIC consumers, presumably making their respective purchases largely unknown to (and independent of) one another, just happened consistently to select the most expensive combination of items available on these many checks, or the checks do not accurately and truthfully reflect the actual purchases made. The Department argues that the former, innocent explanation is incredible, leaving the latter, inculpatory explanation as the lone reasonable inference. Weighing the Department's Proof The strength of the Department's theory depends, in part, on the number of purchase combinations arising under each of the food checks in question: the more combinations the less likely the observed pattern of uniformity in check prices can credibly be explained as innocent coincidence. In this regard, the Department implicitly has conceded that under-consuming (i.e. foregoing the purchase of some authorized foodstuff(s) or buying less than the maximum allowed quantities thereof) is so infrequent as to have a negligible effect on the analysis.4 This is so because the Department has calculated a "lowest price" for each check type, that being (presumably) the least costliest combination of available items, assuming that the participant purchases the maximum amount of all the listed foodstuffs.5 Accepting the Department's assumptions in arriving at the "lowest price" figures reduces the number of potential purchase combinations, somewhat to the detriment of the Department's position. As mentioned above, some check types offer more food items than others. Check type 029, which already has been examined, allows the participant to buy five separate foods (milk, cheese, juice, cereal, and eggs), as does check type 160 (milk, cheese, juice, cereal, and eggs). Check type 162 lists six products (milk, cheese, juice, cereal, eggs, and peanut butter). Check type 086 authorizes the purchase of four items (milk, cheese, eggs, and peanut butter). Several checks permit the purchase of three food items: 031 (milk, cheese, juice); 159 (milk, juice, eggs); 203 (formula, juice, cereal); and 205 (formula, juice, cereal). One check type, 033, lists two items: milk and cheese. A few (check types 201, 202, and 204) allow the purchase of only one food item: infant formula. Obviously, the greater the number of food items (and attendant alternative forms or brands), the greater the number of purchase combinations, making the Department's argument facially more persuasive in connection with check types 029, 160, and 162, for example, than with respect to check types 201, 202, and 204. There are other factors to consider in evaluating the probative value of the Department's Matrix. One is the number of transactions associated with each check type, and the statistical significance of these numbers. For some check types, especially 029, 086, and, to a lesser extent, 160, the number of transactions during the pertinent period is seemingly too small to demonstrate a pattern, which casts doubt on the validity of the Department's desired inference of wrongdoing concerning these particular checks. Further, no expert testimony providing a comprehensive statistical analysis of the Matrix was (or would be) offered,6 and that also adversely affects the overall weight of this evidence. A related consideration involves the number of customers that the subject transactions comprehend. Assume, as a thought experiment, that every transaction identified in the Matrix involved a separate WIC participant. If true, that fact would bolster the Department's theory, because the probability that the observed uniformity in purchase prices occurred randomly presumably diminishes as the number of customers increases. On the other hand, it seems likely that, over the course of the months in question, some WIC participants used more than one food check to make multiple purchases in J&L's store; hence, the total number of such participants should be less than the total number of transactions reflected in the Matrix. The fewer the participants, the less persuasive the Department's theory, since price-uniformity presumably becomes more likely (and thus less suspicious) as the number of buyers decreases. The evidence in the record does not reveal the actual number of customers involved, which negatively affects the evidential weight of the Matrix. Moreover, there is (and would be) no evidence, such as expert opinion testimony on buying habits in the relevant market, bearing on whether, for any given check type, a particular purchase combination was more or less likely than any other.7 This deficiency undermines the probative value of the Matrix, because it is unreasonable to assume that all purchase combinations are equally likely or, more to the point, that the most expensive combinations are not likely to be seen with greater frequency than others. Indeed, it might reasonably be supposed that the most costly purchase combinations would be the most popular (and thus most often occurring) ones, not only because high-demand items tend to command higher prices than less desired products, but also because WIC participants, as rational economic actors, presumably would want to maximize their benefits. If this supposition were true, then the uniformity in purchase prices shown in the Matrix might not be as anomalous as the Department would have it. It could be, of course, that the high degree of price- uniformity (nearly 100% with some check types) seen here is telling; one can imagine an expert testifying, to make up an example, that while 75% of purchases are expected to be at the dollar-limit, 95% price-uniformity is suspiciously outside the normal distribution. These hypothetical numbers underscore the point, however, that absent such evidence the factfinder is left without a benchmark against which to measure the probative value of the Matrix. The buying patterns it reflects may be highly suspicious, somewhat suspicious——or completely innocent. In addition, to enlarge the foregoing point, because it is reasonable to assume that some percentage——perhaps a significant number——of "regular" purchases (i.e. those untainted by any misconduct) will be at the dollar-limit, it follows that not all of the transactions identified on the Matrix can reasonably be considered suspect. The lack of evidence concerning the percentage of dollar-limit purchases made in similarly-situated, law-abiding stores makes it impossible to calculate, for any given check type, how many of the transactions identified on the Matrix might reasonably be regarded as suspicious——and hence impossible to determine whether, assuming the Matrix is circumstantial evidence of wrongdoing, the violations occurred in a “pattern.” The Department has attempted to shore up its proof with the testimony of John Harrison, a longtime employee of the Department who has extensive experience in conducting compliance investigations of WIC vendors. In an affidavit, Mr. Harrison avers, in pertinent part, as follows: I was instrumental in the development of a retailer profiling system that is used to identify suspect WIC check redemption activities. I continue to provide training and guidance to the Florida WIC Program's investigators in the use of this system. During the past year, data from the system was used to identify [J&L] in Miami for investigation, along with several similar stores in Dade and Broward County that cater to clients of the WIC Program. The investigation of [J&L] confirmed for the Department what had been suggested by the computerized profile of the store and led to the allegations set forth in the November 20, 2000, disqualification letter: that the store was charging a fixed price that was unrelated to the shelf price of foods actually purchased by WIC customers. That is to say, [J&L] has systematically and methodically overcharged the WIC Program for approved WIC foods. The allegations of fixed pricing by [J&L] were substantiated to the Department's satisfaction through comparison with other independently owned stores in Miami-Dade County that appear to be charging fair and honest prices. The computer profile in these stores shows that a wide variety of prices are charged on WIC checks, which reflects the fact that WIC customers make different selections among the types and brands of foods that are approved for purchase. In my years of experience in investigating fraud by retailers in the WIC Program, I have not seen fixed pricing of the kind committed by [J&L], excepting several recent examples in Miami-Dade County. Even if Mr. Harrison's affidavit testimony were believed, this proof has little probative value because all the witness has said, at bottom, is that a computer-generated profile, which is not in evidence, together with other data not in the record, were sufficiently persuasive to convince the Department that J&L is guilty of the instant charge. The Department's burden, however, is to prove J&L's guilt to the factfinder's satisfaction——not merely to tell him that it truly believes the accused store is guilty. On its face, therefore, Mr. Harrison's testimony is not persuasive evidence of the facts that the Department must prove to prevail. Further, without the profile and other information underlying Mr. Harrison's conclusory assertions of guilt, the factfinder cannot independently assess the credibility of his assertions, which consequently are entitled to no more weight than allegations. The Department's proof suffers from another serious shortcoming. Assume, for argument's sake, that the high percentage of dollar-limit checks shown in the Matrix persuasively establishes, inferentially, that the checks which J&L submitted for payment do not accurately and truthfully reflect the actual purchases its WIC customers made. This would mean that J&L has done something wrong. But, the question then would arise, must that "something" be patterned overcharging? Upon reflection, it becomes apparent that the practice of "fixed pricing" or "maximum pricing" (as the Department has called it) could be used to cover up a number of different transgressions. One of them, certainly, is patterned overcharging. If, for example, J&L charged a purchaser of frozen orange juice the (higher) contract price for canned orange juice, that would be a form of overcharging. If this unsavory practice were consistently followed for all food items on all check types, a pattern of "maximum pricing" such as that seen in the Matrix would be produced.8 Imagine another scenario in which a vendor charges every user of check type 029 for a dozen eggs——even those purchasers who choose not to buy eggs. Charging WIC customers for food not received is a separate violation, distinct from overcharging. Yet, if this particular form of fraud were repeated consistently with regard to all check types, a pattern of "maximum pricing" also might emerge——even if no customers (or too few to constitute a "pattern") were "overcharged."9 Providing unauthorized food items is another serious violation. Imagine that a vendor were selling WIC customers ice cream and cookies and other unauthorized foods, and charging them for cheese and eggs and cereal. That, too, might result in a pattern of "maximum pricing," but the violation would not be overcharging. The same can be said about the provision of non- food items, and about the sale of alcoholic beverages and tobacco products as well. These also are separate violations that do not involve overcharging (as that offense is defined in the regulations) but could as readily as overcharging produce a pattern of "maximum pricing." The bottom line is, even if the factfinder were inclined to infer from the pattern of "maximum pricing" shown in the Matrix that J&L committed WIC program violations, for the Department to prevail he would need to infer from that first inference the conclusion that J&L was overcharging its customers and not engaging in some distinguishable wrongdoing (or combination of separate wrongs) with which a pattern of "maximum pricing" would be consistent. He would need further to infer that the overcharging had occurred with such frequency as to constitute a pattern of overcharging (because, remember, a dollar-limit check is not necessarily the product of an overcharge). In other words, to determine that J&L is guilty of the offence charged would require a pyramiding of inference upon inference. Ultimate Factual Determinations From August through November 2000, a high percentage of the WIC checks that J&L submitted for reimbursement were written at their respective dollar-limits. To be sure, this pattern of "maximum pricing" is fishy when considered in the abstract; the evidence, however, fails generally to put this seemingly suspicious pattern into a real-world context, and it fails in particular to establish, as a benchmark, the percentage of checks that would be written at the dollar-limit in the absence of wrongdoing. Thus, being unwilling to infer that the Matrix pattern is per se indicative of wrongdoing, the factfinder is not persuaded that J&L more likely than not engaged in misconduct. Additionally, even if the factfinder were willing to infer that the Matrix pattern would not have emerged but for some wrongdoing on J&L’s part, it would yet be too much of a stretch to infer further that the violation was overcharging as opposed to something else. Because J&L was accused of overcharging and nothing else, J&L cannot be found guilty of the specific offense charged. Finally, while it would be unreasonable to infer, from the Matrix alone, that J&L likely had engaged in overcharging, it would be irrational to infer that any suspected overcharging occurred so regularly as to constitute a pattern, because no demonstrated basis in fact or logic supports the proposition that every dollar-limit check is evidence of a transaction tainted with the fraud of overcharging, and the record reveals no principled basis for distinguishing between innocent maximum purchases and those resulting from misconduct.
