Bankr. E.D.N.C.: In re Dupree Farms- Administrative Exhaustion

Summary:

The decision centers on a dispute over a crop insurance policy, with Dupree Farms alleging that ProAg misrepresented insurance coverage, leading to reduced payouts. Dupree Farms sought damages for negligent misrepresentation, intentional misrepresentation, and other claims.

The court found that federal crop insurance regulations preempted state law claims, and Dupree Farms had not obtained the necessary determination of non-compliance from the Federal Crop Insurance Corporation (FCIC), which is a prerequisite for seeking extra-contractual damages. The FCIC had issued a "No Authority Finding," meaning it could not issue such a determination under the policy in question. As Dupree Farms had not met this requirement, the court granted ProAg’s motion for summary judgment, dismissing Dupree Farms' claims. 

Commentary:

This seems to  be in the same vein as many other cases which require some form of administrative exhaustion  before seeking judicial review,  including in consumer litigation,  see Brown v. Western Sky regarding Tribal Exhaustion, or bankruptcy.

Following the Loper Bright decision by the SCOTUS overturning the Chevron deference,   a closer look at whether the regulations,  such as in this case at 7 C.F.R. Part 400 Subpart P,  creating an obligation to first proceed through "administrative exhaustion"  comply with actual statutory grants.

For more regarding this case,  see also Bankr. E.D.N.C: Dupree Farms v. Producers Ag- Jurisdiction for Post-Confirmation Disputes

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