Bits & Pieces

Volume 20, Edition 8

Well here we are at the end of August – not exactly sure how that happened quite so fast, but time marches on.  Tiana and I were down in Nashville last week (thanks to the Trucking Associations Insurance Council) showing how the CAB services can be used to underwrite and risk control in worker’s compensation. We stopped in to see the folks at Greenwich Transportation Underwriters. I had to post a copy of the mural on the wall in the office I wish you see it up close and really get the many little industries references.  It was a riot!


This was a view from the driver side of a big rig heading into Nashville.  I love it. Thanks for letting me share this with the industry.  I love the pink boots!

By the way the Bits will now include worker’s compensation information which may be relevant to those groups evaluating truck workers compensation – a tough task to say the least.  Help us get the word out and pass this report along to anyone interested.  We would be happy to discuss the relevance of the data to that segment of the insurance industry!

Now on to the news:

COMMERCIAL DRIVERS LICENSES – The FMCSA has issued regulatory guidance, announcing that state driver licensing agencies may agree to administer the commercial driver’s license test to individuals from another state and may facilitate the commercial learner’s permit application for residents of another state. To do so, the state driver licensing agency administering the general knowledge test must transmit the tests directly, securely and electronically to the applicant’s state of domicile. The state of domicile would also need to agree to accept the test results and issue the commercial learner’s permit.

CVSA INSPECTIONS – The CVSA announced that it has added an inspection for electronic equipment in commercial vehicles. The Level III inspection is conducted wirelessly while the vehicle is in operation.  Level VIII inspections must include the following:

  • a descriptive location, including GPS coordinates;
  • electronic validation of who is operating the vehicle;
  • appropriate driver’s license class and endorsement(s) for vehicle being operated;
  • license status;
  • valid medical examiner’s certificate and Skill Performance Evaluation (SPE) Certificate;
  • current driver’s record of duty status;
  • hours-of-service compliance;
  • USDOT or (Canada) NSC number;
  • power unit registration;
  • operating authority;
  • Unified Carrier Registration (UCR) compliance; and
  • Federal out-of-service orders.

The question will be whether the states will develop the resources needed to implement the inspections.

CARGO THEFTS – The SensiGuard Supply Chain Intelligence Center, formerly known as FreightWatch released its latest cargo theft report.  Incidents of cargo theft were down, but the average loss value of stolen merchandise spiked significantly compared to the first quarter of 2017. From April to June, companies recorded 126 incidents of cargo theft in the U.S., down from 140 for the previous quarter, with an average loss value per incident of $140,162, up from $124,933 in the previous quarter, according to a report issued Tuesday. Those numbers represent a 10 percent decrease in volume and 12 percent increase in value compared to the first quarter of 2017. The numbers also represent a 28 percent dip in thefts and a 13 percent decline in loss values compared to April-June 2016. The number of thefts valued at over $1 million during the quarter was four, compared to one such theft in the first quarter of 2017 and three such thefts during the same period in 2016.

What are the big hit items?  Food and beverages, home and garden and electronics loads Where are the thefts?  California, Texas, Tennessee and Georgia. Theft of full truckloads remains the most prevalent method of cargo theft, accounting for 74 percent of all reported thefts.

Of note was a report which focused on the trend in cargo theft of miscellaneous product data recorded from July 2015 to June 2017. The number of theft incidents involving miscellaneous cargo, which typically consists of mixed load retail freight bound for big box retail stores or similar distribution centers, has nearly doubled during the past two years, accounting for 11 percent of reported incidents.

SLEEP APNEA – The FMCSA, in moving to remove regulations as mandated by the President has withdrawn the sleep apnea proposal. The FMCSA concluded that it believes “current safety programs” are the appropriate avenues to address the issue. Without a formal regulation regarding sleep apnea, the FMCSA has relied on guidance. In an FMCSA bulletin from January 2015, the agency said it “does not require that these drivers be considered unfit to continue their driving careers, only that the medical examiner make a determination whether they need to be evaluated and, if warranted, demonstrate they are managing their obstructive sleep apnea to reduce the risk of drowsy driving.”

CVSA ROADCHECK – CVSA conducted inspections in Canada and the US in June, completing more than 62,000 inspections.  Inspections revealed numerous problems with brake systems, cargo securement and tires dominating the list of out-of-service violations handed out by law enforcement According to CVSA, 23 percent of vehicles and 4.2 percent of drivers that received Level I Inspections were placed out of service.

The top three out-of-service vehicle violations were for brake systems (26.9 percent of vehicle had out-of-service violations), cargo securement (15.7 percent) and tires/wheels (15.1 percent).

According to CVSA, a total of 62,013 Level I, II and III inspections were conducted during the 2017 International Roadcheck in the U.S. and Canada. Of those inspections, 19.4 percent of commercial motor vehicles were placed out of service, and 4.7 percent of all drivers inspected were placed out of service.

There were 40,944 Level I inspections; 12,787 Level II walk-around inspections, and 8,282 Level III driver-only inspections conducted during the campaign. Of the 62,013 total Level I, II, and III inspections conducted, 2,940 drivers (4.7 percent) were placed out of service for driver-related violations.

During Roadcheck 2017, there were 7,713 inspections conducted in Canada and 54,300 conducted in the United States.

Vehicle-related results are as follows:

  • Of the 40,944 Level I Inspections conducted, 9,398 vehicles (23 percent) were placed out of service for vehicle-related violations.
  • Of the 2,267 vehicles carrying hazardous materials/dangerous goods that received a Level I inspection, 12.8 percent were placed out of service for vehicle-related violations.
  • The top three vehicle violations related to the transportation of hazardous materials/dangerous goods were for loading and securement (40.4 percent of all out-of-service hazardous materials/dangerous goods violations), shipping papers (22.7 percent) and placarding (20.8 percent).
  • 398 motor coaches received Level I inspections; 40 (10.1 percent) were placed out of service for vehicle-related violations.
  • Of the vehicles placed out of service, brake adjustment and brake system violations combined to represent 7,743 (41.4 percent) of all out-of-service vehicle violations.

Driver results are as follows:

  • Of Level I, II and III inspections of vehicles carrying hazardous materials/dangerous goods, 1.9 percent were placed out of service for driver-related violations.
  • Out of the 598 motor coaches that received Level I, II or III inspections, 23 drivers (3.8 percent) were placed out of service for driver-related violations.
  • The top three driver-related violations were for hours of service (32.3 percent of driver out-of-service violations), wrong class license (14.9 percent) and false log book (11.3 percent).
  • There were 710 safety belt violations.

Each year, International Roadcheck places special emphasis on a category of violations. This year’s focus was cargo securement. While checking for compliance with safe cargo securement regulations is always part of roadside inspections, CVSA highlighted proper cargo securement this year as a reminder of its importance. Cargo securement violations (not including hazardous materials/dangerous goods loading/securement) represented 15.7 percent of all vehicle out of service violations during this year’s Roadcheck.

The top five violations related to cargo securement (out of a total of 3,282) in the United States were:

  1. No or improper load securement (423)
  2. Failure to secure vehicle equipment (379)
  3. Leaking, spilling, blowing, falling cargo (281)
  4. Insufficient tiedowns to prevent forward movement for load not blocked by headerboard, bulkhead or cargo (256)
  5. Failure to secure load (178)International Roadcheck is the largest targeted enforcement program on commercial motor vehicles in the world, with more than 13 trucks or buses inspected, on average, every minute throughout North America during a 72-hour period.

ROAD FATALITIES – National Safety Council released its reports indicating a decrease in roadway fatalities in the first half of the year.  The report indicates that there were 18,680 fatalities, 2.1 million seriously injured people, and 191 billion in costs associated with the deaths and injuries. The NSC cautioned that this decrease is not that significant since the preceding numbers were exceedingly high and they expect an increase in the remainder of the year.

CSA – The FMCSA has revised the CSA methodology to include 12 new roadside inspection violations.  The list of new inspections is below.

BASIC Section Violation Description Severity Weight
Unsafe Driving 392.16B Operating a property-carrying commercial motor vehicle while all other occupants are not properly restrained. 7
Vehicle Maintenance 393.75B-OOS Tire-front tread depth less than 2/32 of inch on a major tread groove 8
393.75C-OOS Tire-other tread depth less than 1/32 of inch measured in 2 adjacent major tread grooves 8
393.75F-SPEED Operating a CMV at speeds exceeding the speed-restriction label of the tire. 8
393.75G-LOAD Weight carried exceeds tire load limit 3
393.75I1 Operating a CMV while weight carried exceeds tire rating due to under-inflation 3
Controlled Substances/Alcohol 392.4A-POS Driver on duty and in possession of a narcotic drug / amphetamine 10
392.4A-UI Driver on duty and under the influence of, or using a narcotic drug / amphetamine, which renders the driver incapable of safe operation 10
392.5A2-DETECT Driver having any measured alcohol concentration, or any detected presence of alcohol while on duty, or operating, or in physical control of a CMV 5
392.5A2-POS Driver having possession of alcohol while on duty, or operating, or in physical control of a CMV 3
392.5A2-UI Operating a CMV while under the influence of an intoxicating beverage regardless of its alcohol content 5
Hazardous Materials Compliance 180.3 Represent a package as meeting a specification that does not meet a specification 8

These new violations were applied retroactively in the SMS with the July 28, 2017 snapshot.

YOUNG DRIVER ASSESSMENT TOOL – ATRI released phase one of its research trying to determine the feasibility of a Young Driver Assessment Tool. The tool would be used to identify younger drivers who match characteristics of safe older drivers. Individual traits that can reliably predict driver safety outcomes – personality, health, and cognition – are identified and discussed in this latest ATRI report.  The next phase of ATRI’s research will involve assembling the relevant measures of the identified predictive factors and conducting a beta test of the Assessment Tool on a small sample of both veteran and entry-level drivers.  Results of the beta test will determine if a larger scale study is warranted. The technical memo is available, free of charge, on the ATRI website.



The Northern District in California rejected a household claimant’s request that the Court dismiss a declaratory judgment action filed by a motor carrier seeking to enforce a limitation of liability.  The Court held that the motor carrier presented a reasonable basis for asserting that the transportation contract with an intermediary was binding on the shipper and might limit the motor carrier’s liability.  (United Van Lines v. Deming, 2017 WL 3149301)

And the preemption battle continues.  The Eastern District of Ohio granted judgment to a motor carrier dismissing all state law claims asserted for damage to an interstate shipment. Counts of negligence and conversion could not be pled in the alternative.  (Steese v. SML Relocation, 2017 WL 3494330)

Over in the Central District of California the Court held that it would retain a case involving an interstate shipment, allowing the defendant to point to bills of lading which showed that the shipments were interstate and therefore subject to the Carmack Amendment even if not specifically pled. (Shaghal, Ltd. V. Central Transport, LLC, 2017 WL 3317812)

The Southern District of California held the claims against a motor carrier were subject to the preemptive effect of the Carmack Amendment even when there was allegation that part of the shipment went by air.   The Court concluded that the claim was interstate in nature even if only partially on a truck.  (Sony Biotechnology v. Chipman Logistics, 2017 US Dist LEXIS 134440)

The District Court in Maryland also considered preemption issues, concluding that ICCTA barred any state law claim, other than the breach of contract claim for overcharge. (Monga v A.B.S. Moving & Storage, 2017 WL3228139)

Federal Express lost its effort to apply a limitation on liability contained in its rules tariff despite the fact that the shipper prepared a bill of lading which incorporated lawful tariffs.  The Eastern District of Texas held that the absence of any notation on the bill of lading which referenced the limitation or any other classification was fatal to establishing notice of the limitation on a first shipment.  (Natural Polymer International Corp. v. FEDEX Corp., 2017 U.S. Dist LEXIS 131023)

Here is another decision in a case that we have reported on a number of times over the last few years.  This time the Southern District Ohio held that the burden of proving that something other than invoice price at destination was a proper measure of damages rested with the motor carrier.  In this case the Court held that replacement cost and not selling price was the proper measure of damages as the motor carrier established that the shipment was replaced. The motor carrier was not required to disprove lost volume theory espoused by many plaintiffs.  Cargo adjusters should read this decision for arguments and ways to support this conclusion when adjusting losses.  (Exel, Inc. v Southern Refrigerated Transport, 2017 U.S. Dist LEXIS  133731)


Worker’s compensation is not life insurance says the 6th Circuit.  When a driver died following an embolism his estate was not entitled to benefits under the Occupational Accident policy as it was not a covered injury.  (Estate of Filer v. National Union Fire ins Co., 2017 US App LEXIS 16307)

A worker’s compensation insurer can intervene, as a right, into a tort action brought by the truck driver employee who recovered benefits.   The Middle District of Louisiana held this to be a right as Louisiana law held that an insurer who failed to intervene would be barred from claiming reimbursement.  (Joiner v. Loutzenhiser.  2017 WL 3448846)


Can states inspect motor carriers when there is no suspicion that the motor carrier is operating improperly?  The 8th Circuit held that a Missouri statute authorizing suspicionless stops of commercial vehicles was not unconstitutional. The Court did, however, allow the action to proceed to determine whether the state could impose this requirement on farm vehicles which may not be subject to commercial truck regulation.  (Calzone v. Hawley, 2017 WL 3485738)

The Middle District in Pennsylvania held that the estate of a truck driver was not permitted to seek recovery from the client of his employer’s under the shipping contract.  It was interesting to read the facts and analysis when the defendant provided information, which was passed on to the driver, with various routes for transport to their drill sites.  The Court held that the defendant had no absolute duty of care to ensure that the driver, who missed a turn and unfortunately lost his life, was fully protected while attempting delivery. (Garlick v. Anadarko Petroleum Corp., 2017 WL 3485738)

A plaintiff’s effort to have a case remanded to state court by adding the trucking company’s dispatcher, who lived locally, failed.  The Southern District of Texas held that the dispatcher was joined only to defeat diversity and dismissed the dispatcher and retained jurisdiction. (Harrison v. Darnas, 2017 U.S. Dist. Lexis 128975)

A trucking company’s effort to keep a case in federal court when then the plaintiff alleged in the complaint that she sought damages in excess of the jurisdictional minimum for diversity jurisdiction was unsuccessful,  The plaintiff sought remand claiming that she understood that she was unlikely to get $75,000 or more.  The Western District of Arkansas agreed and remanded the case.  (Skinner v Empire Express, 2017 WL 3228124)

A commercial auto insurer was permitted to proceed with its declaratory judgment action seeking a declaration that a driver was not entitled to coverage for injuries caused during an altercation with a third party.  The District of Alaska held that determining whether the altercation arose out of the use of the auto would not impact the underlying tort action.  (United Financial Casualty Company v. Northern Gravel & Trucking, LLC, 2017 U.S. Dist. LEXIS  133720)

The Court of Appeals in California upheld a $3.3 million verdict against a trucking company concluding that the presence of THC in the plaintiff’s blood was not evidence that the plaintiff was driving under the influence concluding that the cause of the accident was the negligence of the truck driver. (David v. Hernandez, 2017 WL 3141173)

Anything you say can and will be used against you – It is true. Plaintiff’s counsel who represented the plaintiff in two separate accidents saw his communications on the second accident come back to bite the plaintiff in the first action.  The Eastern District of Louisiana held that the statements of counsel could be used in the suit against a trucker to establish that plaintiff’s injuries in fact occurred during the second accident.  (Wright v. National Interstate Ins. Co., 2017 US DIST LEXIS 136793)

Over in Kansas the District Court held that the estate of a cattle driver was not permitted to recover from the consignee when the driver was hurt while assisting in moving other cattle in the receiving line.  The Court held that the danger was open and obvious and undertaken by the decedent without direction of the consignee. (Gregory v. Creekstone Farms Premium Beef, 2017 WL 3168825)

A plaintiff was not permitted to assert a punitive damages claim against a motor carrier simply because it employed a driver who had minor collisions and citations. The Eastern District of Arkansas also held that a claim of negligent entrustment could not be asserted when the motor carrier accepted vicarious liability for the actions of the driver.  (Bizzell v. Transport Corporation of America, 2017 WL 3381358)

The Middle District of Florida afforded judgment to an insurer, concluding that a policy would drop down to the minimum financial requirement of $300,000 when the driver was not reported prior to the loss.  (National Independent Truckers Insurance Co. v. Wilner Mathieu, 2017 US Dist Lexis 119903)

Have a safe and pleasant Labor Day.  See you in September.

Volume 20, Edition 7

Hope everyone is having a wonderful summer and taking some time to enjoy the summer slowdown.   I already feel the fall rush starting up as conferences and meetings get scheduled.  It is going to be a busy fall.  I don’t know about you but I would like a little more summer.

This month we report:

DRUG TESTING – The FMCSA has reported that the rate of illicit drug use among commercial drivers continues to remain below the level that would require motor carriers to conduct more random testing.  The positive drug usage rate for 2015 was 0.8 percent, reversing an upward trend that began in 2012. When the usage rate is less than 1.0 percent for at least two years running, the FMCSA is authorized to lower the annual random testing rate to 25 percent of drivers, as it did for the 2016-2017 calendar years.

BRAKE SAFETY – CVSA announced the results from an unannounced brake safety day.  79 percent of the large trucks and buses examined did not have any critical item vehicle violations. 9,500 commercial motor vehicles were inspected.  There were 8,140 CMV inspections in the U.S. and 1,384 in Canada. CVSA reports that vehicles were placed out of service during the one-day event:

21 percent of the time for vehicle violations in general, and

12 percent of the time for brake-related violations.

ELECTRONIC INSPECTIONS – An inspection level that is conducted electronically or wirelessly while the commercial motor vehicle is in motion was approved by the CVSA. The newly created Level VIII Electronic Inspection to the North American Standard Inspection Program has no direct interaction with roadside inspectors. Level VIII Electronic Inspection requires an exchange of specific data elements, including location (i.e., GPS coordinates), electronic validation of the driver, driver’s licensing, driver’s medical status, hours-of-service compliance, vehicle registration, operating authority, and Unified Carrier Registration (UCR) compliance.  It may be a while down the road as no member jurisdiction has IT capable of capturing the data to meet CVSA’s definition of Level VIII Electronic Inspection.

FMCSA GOA AUDIT – The GOA released a report on the status of IT at the FMCSA.    The FAST Act required the GOA to review the FMCSA’s IT, data collection and management system. During the review, GAO focused on four investments at FMCSA:

Aspen: a desktop application that collects commercial driver/vehicle inspection details and creates and prints a vehicle inspection report.

Motor Carrier Management Information System (MCMIS): captures data from field offices and is the authoritative source for inspection, crash, compliance review, safety audit and registration data.

Safety Enforcement Tracking and Investigation System (Sentri): used to facilitate safety audits conducted by FMCSA and state users.

Unified Registration System (URS): intended to replace existing registration systems with a single comprehensive, online system and provide FMCSA-regulated entities a more efficient means of submission and manipulation of data pertaining to registration applications.

The GAO concluded that the FMCSA “plan lacks timelines to guide FMCSA’s goal and strategies” and has implemented a modernization plan for existing IT systems.

ELECTRONIC LOGGING DEVICE RULES – The House Committee on Appropriations has advised the FMCSA to implement a “full or targeted delay in the ELD mandate.”  While there was some press indicating that it might be the start of the demise ELD’s others are not so sure.  Right now it is full speed ahead. The FMCSA has taken to the road to explain to carriers how to ensure compliance.

SAFETY FITNESS DETERMINATIONS – The aforementioned bill also contains language that prevents FMCSA from proceeding with Safety Fitness Determinations until the DOT Office of Inspector General certifies all deficiencies have been addressed.  The report does indicate that insurers or potential insurers might be considered as a group authorized to see the data.

HOUSEHOLD GOODS RULES – Some states have moved to implement regulations on household goods. In Arizona a bill was passed that prohibits moving companies from holding in-state customer possessions over a payment dispute. Effective Aug. 8, moving companies will be required to accurately and completely disclose information about fees, charges and insurance. Movers cannot refuse to deliver goods unless they provided consumers with an up-front estimate and the consumer has failed to pay. The new law permits police to take possession of household goods that a mover refuses to deliver and unload.

Louisiana will require HHG moving businesses to be open for business and to be staffed during regular business hours and will suspend or cancel business operations for carriers that fail to maintain a permanent establishment in the state. A hearing would be required to take place before the suspension or cancellation can take effect. In West Virginia HHG carriers are now exempt from the jurisdiction of the Public Service Commission and authority will no longer be required. In Pennsylvania penalties will be increased for “rogue” household goods movers operating in the state. State law now requires HHG movers to register and obtain a permit with the Public Utility Commission, maintain workers compensation coverage, pay wages subject to taxation, and have adequate insurance coverage for goods moved.  The Senate voted unanimously to advance a bill that applies criminal penalties to HHG movers who fail to adhere to existing rules in the state, with initial fines of $5,000, misdemeanor charges and confiscation of vehicles.

DATA REVIEWS – On August 1, 2017, the FMCSA will begin accepting Requests for Data Review (RDRs) into its Crash Preventability Demonstration Program through DataQs.  Crashes eligible for the Crash Preventability Demonstration Program must have occurred on or after June 1, 2017.  The Crash Preventability Demonstration Program is expected to last a minimum of 24 months. FMCSA will use the information from the program to evaluate if these preventability determinations improve the Agency’s ability to identify the highest-risk motor carriers.  More information is available at How to Participate in the Crash Preventability Demonstration Program and Crash Preventability Determinations.

ATA FORECAST – The ATA released its 2017-2028 Freight Transportation Forecast. It concludes that the trucking industry is set to be a trillion dollar industry by 2024.  Industry revenue is expected to keep growing annually by 5.4 percent between 2018 and 2023, according to the American Trucking Association’s report, then top $1 trillion by 2024. Growth is then expected to slow to 4.7 percent through 2028, with motor carrier revenue expected to total $1.24 trillion by the end of that year. Growth in the industry will driven by manufacturing, consumer spending and international trade. For-hire carrier revenue fell 3.8 percent to $368 billion in 2016, but it is expected to increase to 5.4 percent annually between 2018-2023, to $538 billion. For-hire carrier revenue should hit $679 billion by 2028, according to the report. Truckload carrier revenue is forecasted to reach $454 billion by 2023 and $568 billion by 2028. It will experience an average annual increase of 5.4 percent in 2018-2023 and 4.7 percent in 2024-2028

DATA & PREDICTIVE ANALYTICS – A yearly survey conducted by global law firm Norton Rose Fulbright among 196 logistics providers, manufacturers, financiers, and government regulators, among others, founds that 43% of respondents believe big data and predictive analytics will be the most significant driver of change in the transportation industry over the next five years.  82% of respondents anticipate an increase in cyber-attacks over the next five years.  We here at CAB agree that big data is key to understanding the transportation industry!



Independent contractor or employee?  That was the question considered by the Eastern District of Missouri when a driver was injured while a passenger in the sleeper berth.  The Court ruled that under California law the actions of the passenger were those of an independent contract, barring the application of the employee exclusion. The Court paid due attention to the fact that the drivers were paid per shipment and were able to work for other carriers.  The Court also held that the MCS-90 determination of employee would not govern the interpretation of the policy.  (Spirit Commercial Auto Risk Retention Group v. Kailey, 2017 v. 2935726)

The Northern District of Illinois awarded judgment to a truck driver who was injured when his vehicle was struck by another trucking company.  While defendant argued that the plaintiff was not actually injured in the incident, the Court held that there was enough evidence to support a judgment in favor of the plaintiff.  (Leak v. Wadsworth, 2017 U.S.  Dist. LEXIS 101394)

A trucking company was granted summary judgment in the Western District of Texas in an action seeking damages for running over hunting dogs.  The Court held that there was insufficient evidence of negligence.  Plaintiff was also not entitled to assert a claim for outrage against the defendant trucking company.  (Jones v. Duane Livingston Trucking, Inc., 2017 US Dist. LEXIS 99030)

We continue to see cases dealing with indemnity claims against motor carriers.  The 8th Circuit considered a double indemnity issue where a company which offered services, including trucking, to a plant operator and agreed to full indemnity, in turn entered into another contract with the underlying motor carrier which also contained an indemnity clause.  While the Court held that the company offering the services to the plant was obligated to indemnify the plant for personal injuries which occurred when a tank exploded at the site, the same company was precluded from obtaining indemnity from the actual motor carrier.  (Chapman v Hiland, 2017 WL 2990177)

It is interesting to see the number of cases that deal with the question of monetary recovery when considering removal to federal Court. The Western District of Oklahoma held that even though plaintiff asserted damages of exactly $75,000, which would allow for remand, the additional possibility of recovery of attorney’s fees would allow the amount to fall within the diversity jurisdiction requirement of more than $75,000.   The Court kept the case.  (Smith v. Robert Oakley Brown, 2017 WL 2964824)

When injuries were suffered by contact with hazardous materials inside a container which was being cleaned, the injured parties brought suit against the company which had agreed to clean the tanks and outsourced it to the plaintiffs’ employer. The Eastern District in Louisiana held that the plaintiffs’ could not allege a cause of action against the defendant based upon premises liability, however they could allege a cause of action for negligent hiring based upon a known record of safety violations.  (Hernandez v. Dedicated TCS, 2017 U.S. Dist. LEXIS 103378)

Applying the Savage rule, the Western District of Wisconsin concluded that a shipper was not liable for a defect in loading which was open and obvious.  Where the driver was actually involved in the loading process he could not claim that the shipper bore any liability for the defective loading. The final responsibility was held to rest with the carrier.  (Malovanyi v. North American Pipe Corp., 2017 WL 298364)

A plaintiff was permitted to proceed with an action against UPS when she fell over a package left on her doorstep. The Court in the Central District of Illinois held that the claim was not preempted under the Carmack Amendment or the FAAAA.  UPS could also not assert the defense of “open and obvious” as that pertained to a claim for premises liability and not negligent placement of freight. (Muzzarrelli v. UPS, 2017 WL 2786456)

Over in the District Court in New Jersey, the Court decided to abstain from deciding a declaratory judgment on whether a trucker’s liability policy was properly cancelled by the insured.  The Court concluded that as there was a parallel action pending in the state court and on an overall balance the state court action would adequately protect the interests of the parties it need not consider the case.  (National Liability & Fire Insurance Co. v. LP Trucking, 2017 WL 2829602)


Although this case involves a warehouse policy, our inland marine underwriters and claim teams will want to read this one.  The 7th Circuit upheld the policy requirement that the insured issue a warehouse receipt, rate confirmation sheet or contract of storage.  The fact that the insured used bills of lading for receipts was not enough to comply with the requirements of the policy.  The Court also noted that the consent to settlement clause did not apply because the insurer denied the claim before the insured entered into a settlement with the property owner.  It was also interesting that the Court held that the insurer did not waive the terms of the policy by accepting an application which noted that the insured used bills of lading because the insured also attached a warehouse receipt.  (PQ Corporation v. Lexington Insurance Co., 2017 WL 2772587)

The Southern District of Texas held that it would retain jurisdiction over an action involving loss or damage to freight transported from Malaysia to Texas.  As the various defendants had issued bills of lading governing the transport the Court held that the complaint was subject to, and preempted by COGSA, permitting the Court to exercise jurisdiction over the action.  (Ziegler v. Subalipaxk, 2018 WL 2671148)

The District Court on New Jersey considered the impact of the Carmack Amendment on a conversion claim against a common carrier on a pipeline.  The Court concluded that a claim for conversion was preempted by the Carmack Amendment. (George E. Warren v. Colonial Pipeline Company, 2015 WL 30308251)

We see motor carriers now taking the initiative in filing declaratory judgment actions seeking to enforce limitations of liability.  The Northern District in California denied a customer’s motion to dismiss the declaratory judgment filed by a household goods carrier, concluding that the motor carrier asserted the necessary allegations to establish the potential for the limitation to be applicable.  (United Van Lines v.  Deming, 2017 WL 3149301)

See you next month!

© 2017 Central Analysis Bureau