With a few glitches, which is to be expected, the new search engine is up and running. Thank you for all of the positive feedback. We have had so many calls for training so that everyone in a company is aware of the power now at your fingertips. We Love It!
We are also still getting submissions on our request to help us out with finding an acronym for the site. We are going to leave it open again for another month and then give you all of the choices to vote on.
This month we report the following interesting Bits and Pieces:
INCREASED BRAKE VIOLATIONS – For those of you who subscribe to our premium service and receive reports on your carrier’s violations, do not be surprised if you see an upturn in brake violations this month. The CVSA held a brake safety week this month, from Sept. 12 through Sept. 18. The program is designed to increase awareness of brakes and brake issues by educating drivers, mechanics and others. With more inspectors focusing on the brakes we anticipate greater number of violations.
DISTRACTED DRIVING RULES – U.S. Transportation Secretary Ray LaHood held the 2010 national Distracted Driving Summit this month. He introduced the new anti-distracted driving regulations for drivers transporting hazardous materials, commercial truck and bus drivers, and rail operators. The new rulemaking prohibits commercial truck drivers from texting while transporting hazardous materials. The final rules banning commercial bus and truck drivers from texting were also issued. In 2009, nearly 5,500 people died and half a million were injured in crashes involving a distracted driver. A copy of the new rules can be viewed here.
BUS INSPECTIONS – The FMCSA’s sent out its annual national Passenger Carrier Strike Force. Federal, state and local police agencies inspected motorcoach, charter bus and other passenger carriers at popular travel destinations throughout the country. Reports should be forthcoming soon. The FMCSA reports that it in 2009 more than 130,000 commercial buses were inspected, with 4.3 percent of bus drivers and 7.6 percent of buses put out-of-service for violations ranging from significant vehicle deficiencies to hours-of-service non-compliance.
TRUCK – INVOLVED FATALITIES REPORT – The National Highway Traffic Safety Administration reports that truck-involved traffic fatalities declined 20 percent in 2009, dropping from 4,245 in 2008 to 3,380 in 2009. This is the lowest level ever reported and is a 33 percent decrease in fatalities since the hours of service rules (which are currently being attacked) went into effect in 2004. You can view the report here.
TRANSPORTATION PERFORMANCE INDEX – The U.S. Chamber of Commerce released the first-ever nationwide and state-by-state “Transportation Performance Indexes”. The report shows a significant decline over the last five years in how America’s transportation infrastructure is serving the needs of domestic commerce, international trade, and the overall U.S. economy. The National Index utilizes a combination of supply (availability), quality of service (reliability, predictability, safety) and utilization (potential for future growth) across all modes of passenger and freight transportation – highway, public transportation, freight railroad, aviation, marine and intermodal – to undertake its analysis. A copy of the report can be viewed here.
NAFTA – Many years ago I joked that my children would graduate college before the borders opened, never expecting that to be the case. Well, they are done and the borders are still closed. While the U.S. has stopped even its participation in the Pilot Program, Mexico continues to persevere. 10 U.S. based carriers have been given operating authority by the Mexican government to enter into the U.S. Mexico’s largest trucking organization has filed an intent to arbitrate seeking damages from the U.S. for losses caused by the closing of the border.
BTS FREIGHT TRANSPORTATION REPORT – U.S. Department of Transportation’s Bureau of Transportation Statistics (BTS) reported that the Freight Transportation Services Index (TSI) rose 0.4 percent in July from its June level, which is a second consecutive month increase. The Index can be viewed here. The BTS reports that even though the index rose 2.5 percent since July 2009 it is still below the level of every other July since 1997. Overall the freight index is down 11.1 percent over the last five years.
CURRENT CASES
The Northern District in Texas concluded that a transportation broker is not entitled to assert Carmack defenses in an action commenced against it for negligent hiring. As a broker is not subject to the liability regime of a carrier it can not take the benefits. (Chatelaine v Twin Modal, Inc., 2010 WL 3447696)
Ah, household goods claims. For those of you involved in insuring moving and storage you know the problems associated with those claims. The Western District of New York addressed an insurer’s denial of coverage when there were allegations that goods were wet and then repacked with dry goods, resulting in mold damage to all of the goods. The court held that the insurer breached its duty to defend as it was obligated to defend and indemnify the insured for the damage caused by the initial water claim, even if not obligated to indemnify for the commingled goods. The court also rejected the insurer’s position that a water claim fell within the “dampness exclusion”. (Clark Moving & Storage, Inc. v. Selective Insurance Co. of America, 2010 WL 3420453)
Pro Se actions involving household goods are even more difficult. The District Court in Nevada granted a household goods mover motion in limine to exclude testimony of federal safety administration officials concerning the duties of a household goods carrier. The court also refused to allow the plaintiff to admit evidence of prior complaints by other parties against the mover, concluding that it did not support any claim of unfair dealing in plaintiff’s action. (Woods v. Slater Transfer & Storage, Inc., 2010 WL 3433052)
The Central District in California refused to extend the Admiralty material deviation doctrine to a Carmack Shipment. That doctrine will allow for the avoidance of a limitation of liability when a carrier fails to provide an extra service paid for. The court also upheld a negotiated limitation of liability, concluding that the negotiation of the limitation, and the fact that the shipper purchased insurance, more than enough evidence that the limitation met the requirements of the Carmack Amendment. (Personal Communications Devices v. Platinum Cargo Logistics, Inc., 2010 WL 3489165)
In the related case involving the coverage provided to the carrier for the loss, the Central District of California dismissed the cargo owner’s counter-claim against the motor carrier for loss of its insurance coverage because shipments were consolidated. The court held that a “loss of insurance coverage” case was related to the transportation and therefore subject to the preemption of Carmack. (Fireman’s Fund Insurance Co. v Personal Communications Devices, LLC, 2010 WL 3489374)
Warehouse receipts, like bills of lading, often contain suit limitation clauses. The Appellate Division in New Jersey upheld the reasonableness of a requirement that suits be commenced against a warehouse within nine months. It also held that the time to sue ran from the date that the claimant was made aware of the damage. (Globalnet v. Port Newark Refrigerated Warehouse, 2010 WL 3516770)
A class action suit against a domestic and international air carrier was foiled this month. The court denied the request to certify a class of customers seeking to allege that the there was a common scheme and practice to assess customer accounts as soon as waybills were created and charge fees and fuel surcharges regardless of whether the waybill was used. (Cerdent v. DHL Express, 2010 WL 3397501)
More carriers are subject to punitive damages awards as information about drivers becomes more readily available. The Firth Circuit Court of Appeals held that while a motor carrier and the driver were subject to punitive damages, the auto liability policy would not, as a matter of public policy, be held to cover those damages. (Minter v. Great American Insurance Company of New York, 2010 WL 3377639)
Speaking of punitive damages, the Middle District in PA denied a request to dismiss recklessness counts which would support a punitive damage claim. The plaintiff alleged that the driver and the motor carrier knowingly violated federal safety regulations which contributed to the accident. As that was sufficient to plead a claim which could result in punitive damages, the court allowed it to stand. (Osti v. Shaw, 2010 WL 3328027)
Failure to comply with hours of service rules will almost always defeat a defendant’s efforts to get summary judgment. The Southern District of Illinois held that where there was expert testimony supporting a conclusion that the driver was operating in violation of the hours of service rules the driver’s self-serving statement that he was not tired would not allow for judgment in the defendant’s favor. (Carney v. Millis Transfer, Inc. 2010 WL 3359474)
The Appeals Court in Florida upheld a grant of summary judgment in favor of a shipper. The court held that allegations that shipper knew or should have known that the motor carrier often had out of service violations for driver hours, and had a poor safety performance were insufficient as a matter of law if the injured party could not establish that the alleged negligence in hiring the carrier proximately caused the loss. (Davies v. Commercial Metals Company, 2010 WL 3446143)
The Northern District of New York upheld the rebuttable presumption that a party, in this case a trucker, which strikes another vehicle from behind, in this case also a trucker, is negligent. What was interesting was the fact that the driver who was hit from behind had only recently entered the roadway after suffering a blow out and was driving extremely slow in order to get to a nearby rest area. The plaintiff attempted to rebut the negligence finding with an expert who testified that it was a violation of safety regulations to drive that slowly and that the vehicle should have been considered out of service after the blow out. The court held that the expert, Kerry Nelson’s, testimony was inadmissible as it did not meet required standards. The court also held that plaintiff failed to establish that there was a non-negligent reason for not stopping in time. (Prive v. Johnson, 2010 WL 3338810)
An interesting procedural issue in the Western District of Virginia. A driver refused to answers interrogatories asserting a 5th amendment privilege after being advised that possible criminal charges would be filed stemming from a fatal car accident. The plaintiff tried to compel the driver to certify the prior unsigned answers which were prepared before the criminal investigation was known to the driver. The court also held that the limited testimony which the driver had given did not give rise to a waiver of his 5th Amendment rights. While granting the defendant the right to assert the privilege the court warned that it could backfire as an adverse implication could be made by the failure to answer and the driver might also be prohibited from introducing evidence. (Stanley v. Star Transport, 2010 WL 3417855)
Speaking of experts, the court in Southern District of Georgia allowed the testimony of expert Kevin Breckenridge regarding a carrier’s safety obligations. The court also opined that it did not matter if the report was written by plaintiff’s counsel, as long as the expert adopted the report as his own. It also permitted the expert to reach legal conclusions. (Sommers v. Hall, 2010 WL 3463608)
Happy Fall. See you next month.
