Court of Appeals of Georgia.

OCCIDENTAL FIRE AND CASUALTY COMPANY OF NORTH CAROLINA, INC.

v.

JOHNSON et al.

No. A09A1871.

 

March 8, 2010.

 

PHIPPS, Judge.

 

In this interlocutory appeal, Occidental Fire and Casualty Company of North Carolina, Inc. challenges the denial of its motion for summary judgment. Occidental maintains that it is not subject to Georgia’s direct action statute, OCGA § 46-7-12, which allows plaintiffs to sue directly the insurers of motorcarriers. For reasons that follow, we affirm the trial court’s ruling.

 

To prevail at summary judgment, the moving party must demonstrate that there is no genuine issue of material fact and that the undisputed facts, viewed in the nonmovant’s favor, warrant judgment as a matter of law. We review de novo a trial court’s denial of summary judgment, construing the evidence in a light most favorable to the nonmoving party.

 

So construed, the evidence showed that at about 11:30 p.m. on November 10, 2004, Johnny Johnson sustained fatal injuries when his vehicle collided with a tractor-trailer being driven by Carl Anthony Thomas. The tractor belonged to Thomas, who was doing business as T & T Trucking. The trailer hitched to Thomas’s tractor was filled with logs from timber harvester Terrell Enterprises, Inc. Thomas was renting the trailer from Terrell Enterprises.

 

Johnny Johnson’s adult children, Mark Johnson and Paul Johnson, filed this wrongful death suit, naming among other defendants: (i) Thomas; (ii) Carl Anthony Thomas d/b/a T & T Trucking; and (iii) Occidental, the provider of insurance coverage for the carrier operations of Thomas d/b/a T & T Trucking. Occidental was named pursuant to OCGA § 46-7-12(c), which is part of the MotorCarrier Act.

 

OCGA § 46-7-12(c) states, “It shall be permissible under this article for any person having a cause of action arising under this article to join in the same action the motorcarrier and the insurance carrier, whether arising in tort or contract.” “Since the direct action statute is in derogation of common law, its terms require strict compliance.”  “The purpose of permitting joinder of the [i]nsurance [c]ompany in a claim against [a] common carrier is to further the policy of the MotorCarrier Act, that is, to protect the public against injuries caused by the motorcarrier’s negligence.”

 

Stated another way, the purpose of the insurance is not for the benefit of the insured motor common carrier but for the sole benefit of those who may have a cause of action for damages for the negligence of the motor common carrier, making the insurance policy in the nature of a substitute surety bond which creates liability in the insurer regardless of the insured’s breach of the conditions of the policy.

 

“The intent of this state’s motorcarrier laws is that the insurer is to stand in the shoes of the motorcarrier and be liable in any instance of negligence where the motorcarrier is liable.”

 

Occidental argued on motion for summary judgment that it was not subject to direct suit, citing the exemption in OCGA § 46-1-1(9)(C)(x), which excludes from the terms “motor contract carrier” and “motor common carrier”:

 

*2Motor vehicles engaged exclusively in the transportation of agricultural or dairy products, or both, between farm, market, gin, warehouse, or mill, whether such motor vehicle is owned by the owner or producer of such agricultural or dairy products or not, so long as the title remains in the producer…. [T]he term “agricultural products” includes … timber or logs being hauled by the owner thereof or the owner’s agents or employees between forest and mill or primary place of manufacture.

 

The burden of proof as to whether this exemption is applicable lies with the party claiming it, and there is no burden on the opposing party to prove that [the motor vehicle] is not within the exemption. Although at summary judgment a party who will not bear the burden of proof at trial need not conclusively prove the opposite of each element of the non-moving party’s case, here [Occidental] has the burden of proof [with respect to the exemption] and cannot merely rely upon the absence of evidence in the record disproving that the exemption applies.

 

The question on appeal is whether Occidental carried its burden of showing that the “motor vehicle” at issue in the collision was exclusively engaged in the transportation of logs.

 

In this context, this court has accepted “exclusively” to mean: “Apart from all others; only; solely; substantially all or for the greater part. To the exclusion of all others; without admission of others to participation; in a manner to exclude.” 0 It is undisputed that Thomas had used his tractor exclusively to haul Terrell Enterprises’ trailers containing logs for only the several weeks preceding the collision. As Occidental concedes in its appellate brief, “It is also undisputed that before Thomas began exclusively hauling logs for Terrell Enterprises, Thomas did use the tractor portion of the incident tractor-trailer to pull other trailers that contained non-exempt commodities.” Because Occidental’s insured’s motor vehicle (the tractor) was thus not used exclusively to transport logs, Occidental failed to meet its burden of showing that its insured carrier fell within the cited exemption such that it was not subject to liability under the direct action statute.1

 

In claiming otherwise, Occidental has taken issue with the term “motor vehicle” as used in the exemption. Occidental maintains that “motor vehicle” should turn on the particular category of vehicle involved in the underlying incident. In this case, Occidental argues, the involved “motor vehicle” is more particularly categorized as a “tractor-trailer,” comprised of both the tractor owned by Thomas and the trailer rented by Thomas for the purpose of hauling logs. Citing OCGA § 46-1-1(18),2 it asserts, “The definition of ‘vehicle’ found in the definitions section of the exemptions to the direct action statute expressly includes trailers.” Claiming there was evidence that Terrell Enterprises’ log trailers had no practical use other than hauling logs, Occidental posits that the “tractor-trailer” involved in the underlying collision had been used exclusively for hauling logs, an exempt product. Occidental claims that its position is supported by Jarrard v. Clarendon Nat. Ins. Co.3

 

The trial court correctly rejected Occidental’s position. The term “motor vehicle” cannot be considered in isolation and then interpreted in a way that ignores the overall statutory scheme, as Occidental attempts to do. 4 Rather, the term must be considered within the context of the exemption statute, which in turn, “must be construed in relation to other statutes of which it is a part, and all statutes relating to the same subject-matter, briefly called statutes ‘in pari materia,’ are construed together, and harmonized wherever possible, so as to ascertain the legislative intendment and give effect thereto.” 5

 

We have held that the exemptions under the statutory scheme presuppose that the carrier otherwise would be a “motor contract carrier” or “motor common carrier,” as those terms are defined in OCGA § 46-1-1(9).6 That is, even where carriers fall within the general definitions of OCGA § 46-1-1(9), they may nevertheless be

 

exempt from that status by virtue of subparagraph (C). The statute accomplishes this exemption for certain carriers by narrowly defining the types of goods that will qualify the carrier’s motor vehicles for the exemption…. An exemption of carriers of such products is to be taken as an exemption of the products themselves, and not of the carrier. This is a reasonable classification in favor of the producer, which will enable movement of the products over the highways…. 7

 

We are guided by rules of statutory construction, give deference to the policy of the MotorCarrier Act of protecting the public against injuries caused by the motorcarrier’s negligence, and recognize the import of the carrier’s insurance policy. Accordingly, we hold that in this case “motor vehicle” as used in the cited exemption requires separate consideration of the use of the carrier’s “motor vehicle.” 8 We discern no legislative intent that the exemption’s use of the term “motor vehicle” be interpreted, as Occidental urges, so as to instantly change a motorcarrier’s statutorily non-exempt status merely by hitching to the carrier’s motor propelled vehicle another entity’s trailer of exempt products.

 

Our construction of “motor vehicle” accords with existing authority. We have consistently rejected the argument that a carrier’s statutorily exempt status should change based upon the load the carrier was hauling at a given time. For example, in Smith v. Commercial Transp.,9 similar to here, the carrier’s insurer contended that it could not be joined as a party because its insured was not a motor common carrier at the time of the accident.0 We explained:

 

While [the insured carrier] was hauling [exempt products] on the occasion of this accident, it frequently hauled other types of loads which would not be exempt…. It would soon become unworkable to change statutory categorization with each change of load. Thus, under these circumstances, we conclude that [the insured] could not be considered a carrier engaged in an exempt operation despite its cargo of [exempt products] at the time of the accident.1

 

Although couched as a matter of statutory construction, Occidental’s claim is essentially the same as that in Smith: the carrier was hauling (a trailer of) exempt products at a given time; the carrier therefore fell within the exemption. But given the undisputed evidence in this case that Thomas’s motor vehicle (the tractor) had not been engaged exclusively in the transportation of logs, Thomas was not an exempt motorcarrier, despite having hauled only trailers of logs during the several weeks preceding the collision.

 

Finally, contrary to Occidental’s claim, our decision in Jarrard2 does not provide for an outcome in its favor. It is true that, in considering whether the same exemption applied to the carrier such that the insurer could not be directly sued, we referred to the “motor vehicle” involved in the underlying accident as a “tractor-trailer.” 3 But as the factual recitation of that case pertinently sets forth, at the time of the accident, the insurance company provided liability insurance to the carrier, which owned the entire “tractor-trailer.” 4 Moreover, the statutory construction question raised in this appeal was neither presented nor reached in that case.

 

The trial court properly denied Occidental’s motion for summary judgment because the insurance company failed to show that the cited exemption applied with respect to its insured carrier, Carl Anthony Thomas d/b/a T & T Trucking.

 

Judgment affirmed.

 

SMITH, P.J., and BERNES, J., concur.

 

OCGA § 9-11-56(c); Latson v. Boaz, 278 Ga. 113, 598 S.E.2d 485 (2004).

 

Latson, supra.

 

See generally Andrews v. Yellow Freight System, 262 Ga. 476, 412 S.E.2d 712 (1992) (referring to OCGA § 46-7-1 et seq. as the “MotorCarrier Act”).

 

Jackson v. Sluder, 256 Ga.App. 812, 814(1), 569 S.E.2d 893 (2002).

 

Andrews, supra (citations omitted).

 

Ross v. Stephens, 269 Ga. 266, 267, 496 S.E.2d 705 (1998) (citation and punctuation omitted).

 

Miller v. Harco Nat. Ins. Co., 274 Ga. 387, 391(3), 552 S.E.2d 848 (2001) (citations and punctuation omitted).

 

(Emphasis supplied.)

 

Jarrard v. Clarendon Nat. Ins. Co., 267 Ga.App. 594, 595, 600 S.E.2d 689 (2004) (citations and punctuation omitted); see Ga. Cas. & Surety Co. v. Jernigan, 166 Ga.App. 872, 874(1), 305 S.E.2d 611 (1983).

 

0.Jarrard, supra (citation omitted); see Ga. Cas & Surety Co., supra at 875, 305 S.E.2d 611.

 

1.See Jarrard, supra at 596, 600 S.E.2d 689 (evidence of what the insured was hauling on the day of the accident failed to meet burden of showing that the insured vehicle was used exclusively to transport exempt products); Smith v. Commercial Transp., 220 Ga.App. 866, 868-869(3), 470 S.E.2d 446 (1996) (evidence that truck was hauling an exempt product on the day of the accident was insufficient to show that it was used exclusively for that purpose). Accord Ga. Cas. & Surety Co., supra at 874-875, 305 S.E.2d 611 (rejecting insurance company’s argument that, given the circumstances at the time of the collision, an exemption applied).

 

2. Pursuant to this Code provision, “ ‘Vehicle’ or ‘motor vehicle’ means any vehicle, machine, tractor, trailer, or semitrailer propelled or drawn by mechanical power and used upon the highways in the transportation of passengers or property, or any combination thereof, determined by the Department of Motor Vehicle Safety.”

 

3. Supra.

 

4. See Ga. Emission Testing Co. v. Jackson, 259 Ga.App. 250, 253, 576 S.E.2d 642 (2003).

 

5.Pafford v. Biomet, 264 Ga. 540, 542(1), 448 S.E.2d 347 (1994) (citation omitted).

 

6. See Ga. Cas. & Surety Co., supra at 874, 305 S.E.2d 611; see also OCGA § 46-7-12(c) (providing for joinder under this article of the motorcarrier and the insurance carrier); see further OCGA § 46-1-1(9)(A) (defining “motor contract carrier” as “every person, except common carriers, owning, controlling, operating, or managing any motor propelled vehicle including the lessees or trustees of such persons or receivers appointed by any court used in the business of transporting persons or property for hire over any public highway in this state and not operated exclusively within the corporate limits of any city”), 46-1-1(9)(B) (defining “motor common carrier,” as “every person owning, controlling, operating, or managing any motor propelled vehicle, and the lessees, receivers, or trustees of such person, used in the business of transporting for hire of persons or property, or both, otherwise than over permanent rail tracks, on the public highways of Georgia as a common carrier”).

 

7.Ga. Casualty & Surety Co., supra at 873-874, 305 S.E.2d 611 (citations omitted, emphasis supplied).

 

8. See id. Accord Morgan Driveaway, Inc. v. Canal Ins. Co., 266 Ga.App. 765, 768-769(2), 598 S.E.2d 38 (2004) (reviewing whether carrier’s dump truck was exempt from general definition of “motor contract carrier” and “motor contract carrier”); Ga. Cas. & Surety Co., supra at 875, 305 S.E.2d 611 (reviewing whether carrier’s unloaded truck was exempt from general definition of “motor contract carrier”).

 

9. Supra.

 

0.Id. at 868(3), 305 S.E.2d 611.

 

1.Id. at 869, 305 S.E.2d 611.

 

2. Supra.

 

3. See id. at 594, 305 S.E.2d 611.

 

4. Id.

United States District Court,

N.D. California.

TRAVELERS INDEMNITY COMPANY OF CONNECTICUT; Marinpak MPK Sonoma, Inc., Plaintiffs,

v.

COLMA DRAYAGE, INC.; Devincenzi Trucking, Inc.; Fredrick Shumate dba Shumate Enterprises, LLC; and Does 1-20, inclusive, Defendants.

Devincenzi Trucking, Inc., Third-Party Plaintiff,

v.

Carrix, Inc., and its subsidiary, SSA Marine International, Third-Party Defendants.

No. 09-3118 SC.

 

March 15, 2010.

 

ORDER DENYING MOTION TO DISMISS THIRD-PARTY COMPLAINT

 

SAMUEL CONTI, District Judge.

 

I. INTRODUCTION

 

Now before the Court is the Motion to Dismiss Third-Party Complaint (“Motion”) filed by third-party defendants Carrix, Inc., and SSA Marine International (collectively, “Carrix”). Docket No. 48. Carrix seeks to dismiss the Third-Party Complaint filed against them by defendant and third-party plaintiff Devincenzi Trucking, Inc. (“Devincenzi”). Docket No. 36 (“Devincenzi Compl.”). The Motion is fully briefed. Docket Nos. 62 (“Opp ‘n”), 65 (“Reply”). Having considered the papers submitted by each party, the Court concludes that this matter is appropriate for determination without oral argument. For the reasons stated below, the Court DENIES Carrix’s Motion.

 

II. BACKGROUND

 

This suit began with a Complaint in Subrogation filed by Plaintiff Travelers Indemnity Company of Connecticut (“Travelers”), which is the insurer for Marinpak MPK Sonoma, Inc. (“Marinpak”), a food processor located in Sonoma, California. Docket No. 1 (“Travelers Compl.”) at 3. According to Travelers, Marinpak ordered a particular piece of machinery from a French manufacturer that was designed and built to specifications for Marinpak’s Sonoma facility. Id. The machinery was shipped from France to Oakland as cargo that “consisted of one standard container holding three packed crates and another flat rack container holding two packed crates.” Id. Travelers states that it successfully arrived in Oakland, California. Id.

 

After the cargo arrived in Oakland, Marinpak contacted Colma Drayage, Inc. (“Colma”), to secure transportation for the machinery from Oakland to its Sonoma facility. Id. According to Travelers, Colma arranged for Devincenzi to pick up and transport the machinery, and Devincenzi in turn arranged for Shumate Enterprises, LLC (“Shumate”) to pick up and transport the machinery. Id. The machinery was loaded onto a truck. Id. While the machinery was being transported by truck from Oakland to Sonoma, one of the crates struck a highway overpass and damaged critical components of the machinery. Id. According to the Complaint, Travelers had to pay a total of $764,059.28 to Marinpak to replace the machinery, and Marinpak sustained uninsured business losses totaling $465,276.63. Id. at 4. Travelers and Marinpak filed this action against Colma, Devincenzi, and Shumate, alleging violation of the Carmack Amendment, 49 U.S.C. § 14706.

 

Devincenzi thereafter filed a third-party complaint against Carrix and its wholly-owned subsidiary, SSA Marine International. See Devincenzi Compl. ¶¶ 1-2. Devincenzi alleges that Carrix provides “marine terminal and transportation services, including such services to some or all of the parties to the [Travelers] Complaint In Subrogation,” and that any liability that Devincenzi incurs in the underlying suit is the result of “the active and primary negligence or otherwise wrongful conduct of [Carrix] in connection with the handling of the freight ….” Id. ¶¶ 6, 8. As Devincenzi explains more clearly in its Opposition to Carrix’s Motion, Carrix “got the load, including its flat rack, ready to be hooked up to the truck-tractor that was to haul the cargo to Sonoma County. Once the load was ready to be hauled, Shumate hooked up its truck-tractor and hauled the load away from the Port of Oakland,” only to strike a freeway overpass before reaching its destination. Opp’n at 1-2.

 

Although this Court clearly has subject matter jurisdiction over Travelers’ claim under the Carmack Amendment, Carrix argues that this Court lacks jurisdiction over Devincenzi’s third-party complaint for indemnification, on the basis that the complaint involves a separate “occurrence” from the facts that constitute Travelers’ Carmack claim. Mot. at 6-9. Carrix filed the Motion that is now before the Court to challenge this Court’s subject matter jurisdiction over the Devincenzi Complaint.

 

III. LEGAL STANDARD

 

As a court of limited jurisdiction, “[a] federal court is presumed to lack jurisdiction in a particular case unless the contrary affirmatively appears.”   Stock West, Inc. v. Confederated Tribes, 873 F.2d 1221, 1225 (9th Cir.1989). When a defendant submits a motion to dismiss under Rule 12(b)(1) of the Federal Rules of Civil Procedure, the Plaintiff bears the burden of establishing the propriety of the court’s jurisdiction. See Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377, 114 S.Ct. 1673, 128 L.Ed.2d 391 (1994). “A Rule 12(b)(1) jurisdictional attack may be facial or factual.” Safe Air for Everyone v. Meyer, 373 F.3d 1035, 1039 (9th Cir.2004). In a facial attack on subject matter jurisdiction, the defendant challenges the basis of jurisdiction as alleged in the complaint. Id. In such a case, the court may assume that the factual allegations in the complaint are true, and draw all reasonable inferences in the plaintiff’s favor. See Wolfe v. Strankman, 392 F.3d 358, 362 (9th Cir.2004).

 

IV. DISCUSSION

 

By its Opposition, Devincenzi effectively concedes that there is no basis for subject matter jurisdiction over its third-party Complaint, except through supplemental jurisdiction obtained under 28 U.S.C. § 1367(a). Opp’n at 3. This Court agrees that Devincenzi’s allegations are insufficient to establish diversity jurisdiction, and that the claim does not give rise to a significant federal question. The Court therefore has jurisdiction over Devincenzi’s claim only if it is “so related” to claims that are within the original jurisdiction of this Court “that they form part of the same case or controversy under Article III of the United States Constitution.” 28 U.S.C. § 1367(a).

 

There is no question that this Court has original jurisdiction over Travelers’ claim against Devincenzi and the other primary defendants. This is a claim brought under the Carmack Amendment, 49 U.S.C. § 14706, which “is the exclusive cause of action for interstate shipping contract claims, and it completely preempts state law claims alleging delay, loss, failure to deliver and damage to property.” White v. Mayflower Transit, L.L.C., 543 F.3d 581, 584 (9th Cir.2008). This statute holds any carrier or freight forwarder liable “for the actual loss or injury to the property” caused by any carrier “whose line or route the property is transported in,” or who received or delivered the property. 49 U .S.C. § 14706(a).

 

Although the accident occurred during transportation between Oakland, California, and Sonoma County, California, “the Carmack Amendment applies to the inland leg of a [foreign] shipment even if that leg is fully intrastate.” Chubb Group of Ins. Cos. v. H.A. Transp. Sys., 243 F.Supp.2d 1064, 1068 n. 3 (C.D.Cal.2002) (citing Project Hope v. M/V IBN Sina, 250 F.3d 67, 70-71, 73 (2nd Cir.2001)). In addition, the Court notes that Travelers’ claim is well over the $10,000 jurisdictional minimum set by 28 U.S.C. § 1337(a).

 

*3Carmack effectively codified the strict liability rule that governed the liability of common carriers at common law. Once the shipper establishes a prima facie case of Carmack liability by showing delivery in good condition, arrival in damaged condition, and the amount of damages, the carrier is liable for the actual loss or injury to the property it transports, unless there is an available defense.

Sompo Japan Ins. Co. of Am. v. Union Pac. R.R., 456 F.3d 54, 59 (2nd Cir.2006) (citations and internal quotation marks omitted).

 

The question now before the Court is whether Travelers’ Carmack claim against Devincenzi and the other defendants “form part of the same case or controversy” as Devincenzi’s indemnity claim, which is “predicated on the active and primary negligence or other wrongful conduct” of Carrix. Put otherwise, this Court will have jurisdiction only if the two claims “derive from a common nucleus of operative fact.” See Carpenters Health & Welfare Trust Fund v. Tri Capital Corp., 25 F.3d 849, 852-53 (9th Cir.1994) overruled on other grounds by S. Cal. IBEW-NECA Trust Funds v. Std. Indus. Elec. Co., 247 F.3d 920, 928-29 (9th Cir.2001) (equating standard in 28 U.S.C. § 1367(a) with “common nucleus” standard articulated in United Mine Workers v. Gibbs, 383 U.S. 715, 725, 86 S.Ct. 1130, 16 L.Ed.2d 218 (1966)).

 

Carrix rests its argument primarily on one case, that of Galt G/S v. Hapag-Lloyd AG, 60 F.3d 1370 (9th Cir.1995). Galt was an admiralty action in which Galt, the insurer for Safeway Stores, sued carrier Hapag-Lloyd for damage to 2160 tins of ham that had been transported from Denmark to California. Id. ¶ 1372. Safeway did not discover that the ham was frozen and spoiled until well after delivery, and after it had been stored in Safeway’s own facilities for more than a week. Id. Hapag-Lloyd claimed that none of the carriers could have frozen the ham, and the district court allowed Hapag-Lloyd to bring a third-party claim against Safeway. Id. After a bench trial, the district court awarded judgment to Hapag-Lloyd, and the Ninth Circuit reversed, citing the lack of supplemental jurisdiction over Hapag-Lloyd’s claim:

 

We conclude that the cargo damage claim and the ancillary claims arise from different occurrences. The alleged occurrence in the cargo damage claim is whether Hapag-Lloyd or one of the carriers mishandled the ham during shipment; the alleged occurrence in the indemnification claim is whether Safeway stored the ham improperly. The two occurrences are separated by the carriers’ relinquishing control over the hams. They are also separated in time. Accordingly, the district court erred in exercising ancillary jurisdiction over the California indemnification claims against Safeway.

 

Id. at 1374.

 

According to Carrix, Galt controls the outcome of this Motion because “there can be no legal connection or relationship between [Carrix] ‘handling’ the cargo, and a motorcarrier driving the cargo into a bridge” because “these two discrete occurrences are so far removed in time and in location that they cannot be said to form ‘part of the same case or controversy ….’ ” This Court disagrees.

 

*4Galt does prevent this Court from finding that the two claims “form the same case or controversy” on the sole basis that they involve two theories as to the factual cause of a single injury. See 16 James Wm. Moore et al., Moore’s Federal Practice § 106.24(3rd ed.1999) (noting that Galt “seem [s] to reject, or at least ignore, a single-injury approach with regard to multiple causation”). However, Galt does not stand for the proposition that a carrier’s claims against a third party will always form a separate case or controversy. The relationship apparent here, between Devincenzi’s claim and Travelers’ claim, is stronger than the relationship that existed in Galt, between Hapag-Lloyd’s allegations and Galt’s allegations. In Galt, Hapag-Lloyd and Galt each expounded an independent theory as to how the ham was, in fact, damaged. The facts necessary to prove one theory (damage in transit) were separate from the facts needed to prove the competing theory (damage in Safeway’s storage). Damage that was caused in storage bore no causal relationship to damage that occurred in transit. In contrast, both Travelers and Devincenzi allege that Marinpak’s machinery was damaged when it hit the overpass. There is a direct causal link between Carrix’s alleged negligence and the event that, all parties agree, caused the injury. Devincenzi merely alleges an additional link in the causal chain that lead to that injury (i.e., Carrix’s negligence), and not an independent chain that preludes Devincenzi’s own involvement or liability. This is a claim that a third party’s negligence contributed to an injury that clearly occurred during carriage, rather than a claim that a third party’s acts independently caused that injury after carriage. The Court finds that Devincenzi’s claim bears “a common nucleus of operative fact” with Travelers’ claim, and is related enough to support supplemental jurisdiction over Devincenzi’s Complaint.

 

The Court also notes that Carrix’s Reply contains a number of arguments that go to the merits of Devincenzi’s claim, to show that “Devincenzi has no legal basis to assert a state law indemnity claim against Carrix/SSA for this loss.” Reply at 4-5. These arguments include citations to the California Vehicle Code and cases applying indemnity principles in similar situations. Id. These arguments go well beyond the jurisdictional arguments set out in Carrix’s initial Motion. Devincenzi may not, in its Reply, present new arguments that have the effect of converting its 12(b)(1) motion into a 12(b)(6) motion. Devincenzi has had no opportunity to respond to these arguments, and this Court therefore does not consider Carrix’s arguments on the merits.

 

Devincenzi has also indicated that it has discovered that “the actual entity in charge of the terminal and dock at the Port of Oakland was a California entity, SSA Terminals (Oakland), LLC,” and it has requested leave to file an amended third-party complaint that also names this party as a defendant. This Court should freely give such leave when justice requires. Fed.R.Civ.P. 15(a)(2). Carrix’s only objection is that amendment would be futile because this Court lacks subject matter jurisdiction over Devincenzi’s claim-an argument that the Court rejects for the reasons stated above. Devincenzi is therefore granted leave to amend its third-party complaint.

 

V. CONCLUSION

 

Carrix’s Motion to Dismiss is DENIED. In addition, Devincenzi’s request for leave to amend its third-party complaint is GRANTED. Devincenzi must file the amended third-party complaint within seven (7) days of the date of this Order.

 

IT IS SO ORDERED.