62 Agric. Dec. 406

I find subdealers to which Petitioner distributed fluid milk products could turn to other handlers in periods of short production for their fluid milk product needs. Therefore, following Judge Cahn's decision in Kreider I, I conclude Petitioner was "riding the pool" and was not a producer-handler under former Milk Marketing Order No. 2 during the period May 1997 through December 1999.

Petitioner's Appeal Petition

Petitioner raises three issues in its Appeal Petition. First, Petitioner contends the ALJ's dismissal of Petitioner's Amended Petition, based on Petitioner's failure to renew its application for designation as a producer-handler under former Milk Marketing Order No. 2, is error (Appeal Pet. at 3-5).

Petitioner filed an application for designation as a producer-handler under former Milk Marketing Order No. 2 in January 1991 (PX C). In August 1992, the Market Administrator denied Petitioner's application for designation as a producer-handler (PX E). On December 28, 1993, Petitioner instituted a proceeding challenging the Market Administrator's denial of Petitioner's January 1991 application for designation as a producer-handler (Kreider I Pet.). On August 12, 1997, Judge Bernstein issued a Decision and Order on Remand in which he upheld the Market Administrator's denial of Petitioner's application for designation as a producer-handler under former Milk Marketing Order No. 2 and dismissed Petitioner's Kreider I Petition.22 Petitioner failed to file a timely appeal, and the August 12, 1997, Kreider I Decision and Order on Remand became final.23 Consequently, the proceeding regarding Petitioner's January 1991 application for designation as a producer-handler under former Milk Marketing Order No. 2 is concluded.

Section 1002.12 of former Milk Marketing Order No. 2 (7 C.F.R. § 1002.12 (1999)) defines a producer-handler as a handler who, following the filing of an application for designation as a producer-handler, has been so designated by the Market Administrator. Petitioner has not filed another application for designation as a producer-handler under former Milk Marketing Order No. 2; therefore, Petitioner's Amended Petition constitutes

22In re Kreider Dairy Farms, Inc., 59 Agric. Dec. 21 (1997).

23 In re Kreider Dairy Farms, Inc., 57 Agric. Dec. 397 (1998) (Order Denying Late Appeal), aff'd, 190 F.3d 113 (3d Cir. 1999), reprinted in 58 Agric. Dec. 719 (1999).

a premature challenge to a denial of an application which has not yet been filed or denied, and Petitioner's Amended Petition should be dismissed.

Petitioner states, until the ALJ's Initial Decision and Order, it had no notice that its failure to file another application for designation as a producer-handler under former Milk Marketing Order No. 2 was an issue. Petitioner contends the ALJ's dismissal of its Amended Petition on grounds that were not raised prior to the issuance of the Initial Decision and Order denies Petitioner due process.

Former Milk Marketing Order No. 2 unambiguously requires a handler claiming to meet the requirements for designation as a producer-handler to file an application with the Market Administrator (7 C.F.R. § 1002.12 (1999)). The application requirement was published in the Federal Register; thereby constructively notifying Petitioner of the application requirement.24 Moreover, based on Petitioner's filing an application for designation as a producer-handler in January 1991, I infer Petitioner had actual notice of the former Milk Marketing Order No. 2 application requirement.

Second, Petitioner contends the ALJ erroneously held, even though Petitioner met the criteria for designation as a producer-handler set down by Judge Cahn, Petitioner was not entitled to relief (Appeal Pet. at 5-7).

The ALJ found, during May and June 1997 and from February 1998 through December 1999, Petitioner met the criteria for designation as a producer-handler set down by Judge Cahn. However, the ALJ departed from Judge Cahn's 1996 Kreider I direction in Kreider II, for the reasons that: (1) the January 1991 application did not constitute an application for designation as a producer-handler for the period May 1997 through December 1999; and (2) the Market Administrator's interpretation of complete and exclusive control over distribution was not contrary to law (Kreider II Initial Decision and Order at 13-14, 27). Petitioner contends the ALJ's departure from Judge Cahn's 1996 Kreider I decision is error because Judge Cahn's Kreider I decision is the law of the case (Appeal Pet. at 6).

"See FCIC v. Merrill, 332 U.S. 380, 385 (1947); United States v. Pitney Bowes, Inc., 25 F.3d 66,71 (2d Cir. 1994); United States v. Wilhoit, 920 F.2d 9, 10 (9th Cir. 1990); Jordan v. Director, Office of Workers' Comp. Programs, 892 F.2d 482, 487 (6th Cir. 1989); Kentucky ex rel. Cabinet for Human Resources v. Brock, 845 F.2d 117, 122 n.4 (6th Cir. 1988); Government of Guam v. United States, 744 F.2d 699, 701 (9th Cir. 1984); Bennett v. Director, Office of Workers' Comp. Programs, 717 F.2d 1167, 1169 (7th Cir. 1983); Diamond Ring Ranch, Inc. v. Morton, 531 F.2d 1397, 1405 (10th Cir. 1976); Wolfson v. United States, 492 F.2d 1386, 1392 (Ct. Cl. 1974) (per curiam); United States v. Tijerina, 407 F.2d 349, 354 n.12 (10th Cir.), cert. denied, 396 U.S. 867, and cert. denied, 396 U.S. 843 (1969); Ferry v. Udall, 336 F.2d 706, 710 (9th Cir. 1964), cert. denied, 381 U.S. 904 (1965).

62 Agric. Dec. 406

Generally, under the law of the case doctrine, when a court decides upon a rule of law, that decision continues to govern the same issue in subsequent stages of the same case. 25 While Kreider I and Kreider II are related cases, Kreider I and Kreider II are two separate distinct proceedings. Therefore, Judge Cahn's decision in Kreider I would not appear to be the law of the case in Kreider II. However, a number of cases hold that, at least under certain circumstances, the law of the case doctrine is applicable not only to the same case, but also to closely related cases.26 Nevertheless, even if a court reviewing Kreider II were to conclude that Judge Cahn's Kreider I decision is the law of the case in Kreider II because Kreider I and Kreider II are closely related cases, the reviewing court might allow departure from the application of the law of the case doctrine because material facts in Kreider I are not identical to the facts in Kreider II." I find particularly significant Petitioner's filing an

25 Agostini v. Felton, 521 U.S. 203, 236 (1997); Arizona v. California, 460 U.S. 605,618 (1983); Public Interest Research Group of New Jersey, Inc. v. Magnesium Elektron, Inc., 123 F.3d 111,116 (3d Cir. 1997); Matter of Resyn Corp., 945 F.2d 1279, 1281 (3d Cir. 1991); Constar, Inc. v. National Distribution Centers, Inc., 101 F. Supp.2d 319, 323 n.2 (E.D. Pa. 2000).

26 Casey v. Planned Parenthood of Southeastern Pennsylvania, 14 F.3d 848, 856 n.11 (3d Cir.) (stating law of the case rules, including the mandate rule, have developed to maintain consistency and avoid reconsideration of matters once decided during the course of a single continuing lawsuit; other law of the case rules apply to subsequent rulings by the same judge in the same case or a closely related case), stay denied, 510 U.S. 1309 (1994); Antonioli v. Lehigh Coal and Navigation Co., 451 F.2d 1171, 1178 (3d Cir. 1971) (stating, even if the Court were to find that res judicata did not apply, the Court would be bound under the doctrine of the law of the case by a decision in a prior related case), cert. denied, 406 U.S. 906 (1972); Coleco Industries, Inc. v. Universal City Studios, Inc., 637 F. Supp. 148, 150 (S.D.N.Y. 1986) (stating it is the duty of the District Court to follow the law of the case, albeit a related case, particularly when the law has been pronounced, at least pro tem, by this Court); United States v. Musick, 534 F. Supp. 954, 956-57 (N.D. Cal. 1982) (stating the law of the case is not properly invoked where the case is not the same; nevertheless, the general rule is that a decision in one case is controlling as the law of the case in a related action if it involves the same subject matter and if the points of decision and facts are identical).

11Numerous courts have held that extraordinary circumstances, including changed facts or new evidence, may warrant reconsideration of previously decided issues. See, e.g., Wyoming v. Oklahoma, 502 U.S. 437, 446 (1992) (stating the law of the case doctrine should be applied absent changed circumstances or unforeseen issues not previously litigated); In re City of Philadelphia Litigation, 158 F.3d 711, 718 (3d Cir. 1998) (stating the law of the case doctrine does not preclude the court's reconsideration of previously decided issues in extraordinary circumstances such as where: (1) new evidence is available; (2) a supervening new law has been announced; or (3) the earlier decision was clearly erroneous and would create manifest injustice); Patel v. Sun Co., 141 F.3d 447, 461 n.9 (3d Cir. 1998) (stating there are three traditional exceptions to the law of the case doctrine: (1) new evidence is available; (2) a supervening new law has been announced; and (3) the earlier decision was (continued...)

application for designation as a producer-handler in Kreider I and Petitioner's failure to file an application for designation as a producer-handler in Kreider II. As an application for designation as a producer-handler is a necessary prerequisite for producer-handler status, 28 Judge Cahn's remand to determine whether Petitioner was "riding the pool" is a question that need not be addressed in Kreider II where Petitioner has not taken the necessary first step of applying for designation as a producer-handler. Nonetheless, as stated in this Decision and Order, supra, since a reviewing court may conclude that Judge Cahn's Kreider I decision is the law of the case in Kreider II, I find facts that would be required if a reviewing court were to conclude that Judge Cahn's Kreider I decision is the law of the case in Kreider II.

Third, Petitioner contends it should be refunded billings related to its sales of fluid milk products during the period from December 1995 to May 1997 (Appeal Pet. at 7-9).

Petitioner litigated the issue of its status as a producer-handler under former Milk Marketing Order No. 2 in Kreider I. The Kreider I Decision and Order on Remand decided, on the merits, the issue of Petitioner's status under former Milk Marketing Order No. 2 during the period in which Petitioner distributed fluid milk products to Ahava. Issue preclusion bars Petitioner's claim that it was a producer-handler in those months in which Petitioner distributed fluid milk products to Ahava. Petitioner distributed fluid milk products to Ahava in each month during the period December 1995 through April 1997. Thus, Petitioner is barred by issue preclusion from relitigating in the instant proceeding Petitioner's status under former Milk Marketing Order No. 2 during the period December 1995 through April 1997.29

Findings of Fact

27(...continued)

clearly erroneous and would create manifest injustice); Public Interest Research Group of New Jersey, Inc. v. Magnesium Elektron, Inc., 123 F.3d 111, 116-17 (3d Cir. 1997) (stating extraordinary circumstances that warrant the court's reconsideration of an issue decided earlier in the course of litigation include situations in which new evidence is available, supervening new law has been announced, or the earlier decision was clearly erroneous and would create manifest injustice); NL Industries, Inc. v. Commercial Union Insurance Co., 65 F.3d 314, 324 n.8 (3d Cir. 1995) (stating courts should reconsider an issue when there has been an intervening change in controlling law, when new evidence has become available, or when there is a need to correct clear error or prevent manifest injustice).

287 C.F.R. § 1002.12 (1999).

29 In re Kreider Dairy Farms, Inc., 59 Agric. Dec. 779 (2000) (Ruling on Certified Question).

62 Agric. Dec. 406

1. Petitioner is a Pennsylvania corporation. Petitioner has its place of business in Manheim, Lancaster County, Pennsylvania. Ronald Kreider is an owner and the president of Petitioner (Tr. 106-07).

2.

During the period December 1995 through December 1999, Petitioner produced milk on its own dairy farm, processed that milk in its own processing plant on its farm, and distributed that milk in its own trucks to its customers (Tr. 106-07).

3. In 1990, the Market Administrator became aware that Petitioner was distributing fluid milk products into the area covered by former Milk Marketing Order No. 2. In a letter dated December 19, 1990, the Market Administrator informed Petitioner that it must pay into the producer-settlement fund or apply for and obtain designation as a producer-handler (PX B).

4. In January 1991, Petitioner filed an application for designation as a producer-handler under former Milk Marketing Order No. 2 with the Market Administrator (PX C).

5. The Market Administrator did not designate Petitioner as a producer-handler and in August 1992 denied Petitioner's application for designation as a producer-handler under former Milk Marketing Order No. 2 and continued to classify Petitioner as a handler (PX E).

6. As a handler, Petitioner was required to pay into the producer-settlement fund a percentage of its fluid milk (Class I) proceeds (7 C.F.R. pt. 1002 (1999)). Petitioner paid $244,977.97 into the producer-settlement fund because of being classified as a handler, instead of a producer-handler, for the months of December 1995 through December 1999. Petitioner paid $78,118.64 into the producer-settlement fund because of being classified as a handler, instead of a producer-handler, for the months of May 1997 through December 1999 (PX 4).

7.

If the Market Administrator had designated Petitioner a producer-handler, Petitioner would have been exempt from paying into the producer-settlement fund (7 C.F.R. pt. 1002 (1999)).

8. Petitioner litigated the Market Administrator's denial of its January 1991 application for designation as a producer-handler. On August 12, 1997, Administrative Law Judge Edwin S. Bernstein issued a Decision and Order on Remand in Kreider I, which became final, upholding the Market Administrator's denial of Petitioner's January 1991 application for designation as a producer-handler under former Milk Marketing Order No. 2. Judge Bernstein's Kreider I Decision and Order on Remand was based on Petitioner's distribution of fluid milk products to Ahava. In re Kreider Dairy