United States District Court for the Southern District of Florida
October 27, 2022, Decided; October 28, 2022, Entered on Docket
CASE NO. 1:21-cv-22943-JLK
Reporter
2022 U.S. Dist. LEXIS 196684 *
BERELI, INC., Plaintiff, v. R&L CARRIERS, INC.; R&L TRUCKLOAD SERVICES; and R&L GLOBAL LOGISTICS, Defendants.
Core Terms
carrier, shipment, bill of lading, summary judgment motion, summary judgment, shipper, notice, affirmative defense, cargo, notice of claim, limitation of liability, damages, ammunition, transport, flat rate, argues, levels
Counsel: [*1] For Bereli Inc., Plaintiff: Andrew Robert Spector, Marc Alan Rubin, LEAD ATTORNEYS, Spector Rubin P.A., Miami, FL.
For R & L Carriers Inc., R & L Global Logistics, R & L Truckload Services, Defendants: Steven Craig Jones, Wilson Elser Moskowitz Edelman & Dicker, Miami, FL; Anthony Peter Strasius, LEAD ATTORNEY, Wilson Elser, Miami, FL.
Judges: JAMES LAWRENCE KING, UNITED STATES DISTRICT JUDGE.
Opinion by: JAMES LAWRENCE KING
Opinion
ORDER GRANTING IN PART PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT
THIS CAUSE comes before the Court upon Plaintiff’s Motion for Summary Judgment (“Plaintiffs Motion”) (DE 20), filed September 6, 2022, and Defendants’ Motion for Summary Judgment (“Defendants’ Motion”) (DE 21), also filed September 6, 2022. The Court has also considered Defendants’ Response (DE 23), Plaintiff’s Response (DE 22), and Plaintiff’s Reply (DE 24). Additionally, the Court has considered the Parties’ respective Statements of Undisputed Facts. (DE 20-1, 21 at 1, 22-1).1 The Court being otherwise fully advised finds that Plaintiff’s Motion is granted in part and Defendants’ Motion is denied for the reasons stated herein.
I. BACKGROUND
On July 12, 2021, Plaintiff filed its Complaint in the 11th Judicial Circuit in and for Miami-Dade County, Florida alleging breach of contract (Count I) and violation of the federal Carmack Amendment, 49 U.S.C. § 14706 et seq. (Count II) stemming from damages to Plaintiff’s shipment of ammunition sustained during transport by Defendants. See Compl., DE 1-1 at 4. On August 12, 2021, Defendants timely removed this case to federal court alleging federal question jurisdiction. See Not. of Removal, DE 1 at 3. Under the Court’s operative Scheduling Order, discovery has concluded and the instant pending Cross-Motions for summary judgment were timely filed on the last day of motion practice. DE 8. The final pretrial conference is set for November 4, 2022, and trial set for January 3, 2023. Id.
The following facts are undisputed:
In April 2021, Plaintiff engaged the Defendants to transport a shipment of ammunition from Hollywood, Florida to Inglewood, California. DE 20-1 ¶ 1. On April 21, 2021, the shipment of ammunition was tendered to Defendants in good condition. Id. ¶ 13. On the same day, a bill of lading was generated and provided to Plaintiff. DE 21 at 1; DE 20-1 ¶ 9. On April 23, 2021, Plaintiff was notified that the [*3] truck shipping the ammunition was involved in an accident and overturned resulting in damages to the freight. DE 20-1 ¶ 14; DE 21 ¶ 4. After the loss, Aaron Gheblikian, Vice President of Sales for Plaintiff, discovered no insurance was placed on the shipment by Defendant’s employee Darius Hamby, who was subsequently terminated by Defendant R&L Carriers. DE 20-1 ¶ 15-16. On May 4, 2021, Plaintiff submitted a written notice of loss to which Defendant never responded. DE 20-1 ¶ 17.2
II. LEGAL STANDARD
Summary judgment is appropriate where there is “no genuine issue as to any material fact and [] the moving party is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). An issue is genuine if a reasonable jury could return a verdict for the nonmoving party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir. 1996). A fact is material if it may affect the outcome of the case under the applicable substantive law. Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997).
If a reasonable fact finder could draw more than one inference from the facts, creating a genuine issue of material fact, summary judgment should not be granted. Samples ex rel. Samples v. City of Atlanta, 846 F.2d 1328, 1330 (11th Cir. 1988). The moving party has the burden of establishing both the absence of a genuine issue of material fact and that it is entitled to judgment as a matter of law. See Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S. Ct. 1348, 89 L. Ed. 2d 538 (1986). On a motion for summary [*4] judgment, the court views the evidence and all reasonable inferences in the light most favorable to the non-moving party. Davis v. Williams, 451 F.3d 759, 763 (11th Cir. 2006).
III. DISCUSSION
“The Carmack Amendment governs the liability of domestic common carriers when goods are shipped in interstate commerce.” Hanover Ins. Co. v. HMR Trucking Servs. Corp., No. 18-cv-22397-CMA, 2018 U.S. Dist. LEXIS 219081, at *5 (citing Smith v. United Parcel Serv., 296 F.3d 1244, 1246 (11th Cir. 2002)) (other citations omitted). “When a shipper shows delivery of goods to a carrier in good condition and non-delivery or delivery in a damaged condition, there arises a prima facie presumption of liability.” Hanover Ins. Co, 2018 U.S. Dist. LEXIS 219081, at *5 (quoting UPS Supply Chain Sols., Inc. v. Megatrux Transp., Inc., 750 F.3d 1282, 1285-86 (11th Cir. 2014)). Under the Carmack Amendment, common carriers are strictly liable for all damages resulting from the failure to deliver cargo in the same condition in which they were received. Hanover Ins. Co, 2018 U.S. Dist. LEXIS 219081, at *5 (citing Megatrux Transp., Inc., 750 F.3d at 1285). Before the Court are the Parties’ Cross-Motions for summary judgment. The pending Motions will be addressed in the order they appear on the docket sheet.
A. Plaintiff’s Motion for Summary Judgment
Plaintiff seeks summary judgment on Defendants’ affirmative defenses 2, 3, and 4 and moves this Court to strike these defenses. “On a plaintiff’s motion for summary judgment, the defendant bears the initial burden of showing that the affirmative defense[s] [are] applicable.” Special Purpose Accounts Receivable Coop. Corp. v. Prime One Capital Co., LLC, 125 F. Supp. 2d 1093, 1098-99 (S.D. Fla. 2000) (citations omitted). “Only upon such a showing does the burden shift to the plaintiff [*5] regarding the affirmative defense.” Id. at 1099 (citation omitted). “Summary judgment is therefore appropriate when the defendant fails to come forward with evidence sufficient to dispute an element of the plaintiff’s case or to support an affirmative defense.” Id. (citation omitted).
1. Limitation of Liability
Affirmative defenses 2 and 3 deal with limitation of liability:
2. R+L Global and R+L Truckload plead Carmack Amendment liability limitations.
3. R+L Global and R+L Truckload plead all limitations of liability in whole or in part, to the extent applicable, included in any bill of lading or other contract that arises out of, relates to, or otherwise concerns the involved cargo shipment.
Defs. Answer, DE 7 at 4. Plaintiff argues that Defendants are not entitled to limitation of liability because Defendants rely on air waybill terms and conditions “which were never provided to Plaintiff, and which admittedly would not have been applicable to this type of transaction.” DE 20 at 9. Plaintiff also argues that the bill of lading used here indicated it was “a) a flat rate shipment, and b) a full value declared — replacement cost shipment” and that there was no opportunity to choose between two or more levels of liability [*6] thus prohibiting limitation of liability under the Carmack Amendment. DE 20 at 10.
In their Response, Defendants do not make any counter arguments regarding these affirmative defenses. See DE 23. Instead, Defendants only provide the same argument made in their Motion for Summary Judgment (DE 21), that Plaintiff failed to submit a notice of claim to the appropriate carrier R+L Truckload so the instant lawsuit is premature. DE 23 at 3.
In this Circuit, the Carmack Amendment requires a carrier to meet a four-part test to limit its liability: a carrier must (1) maintain a tariff within the prescribed guidelines of the Interstate Commerce Commission, (2) give the shipper a reasonable opportunity to choose between two or more levels of liability, (3) obtain the shipper’s agreement as to the choice of liability, and (4) issue a receipt or bill of lading prior to moving the shipment. Atl. Specialty Ins. Co. A.S. v. Digit Dirt Worx, Inc., 793 Fed. App’x. 896, 903 (11th Cir. 2019) (citations omitted). “Notwithstanding the amendments to the Carmack Amendment, a carrier wishing to limit its liability is still required to give the shipper a reasonable opportunity to choose between different levels of liability.” Sassy Doll Creations, Inc. v. Watkins Motor Lines, Inc., 331 F.3d 834, 842 (11th Cir. 2003).
Plaintiff specifically states that it was never advised as to the application of the terms on the bill of lading [*7] or otherwise, and there was no opportunity to choose between two or more levels of liability because it was a flat rate shipment and full value was declared. DE 20 at 10. Aaron Gheblikian, Vice President of Sales for Plaintiff Bereli, Inc., declared under oath that a bill of lading was electronically forwarded via e-mail to Plaintiff, however there were no terms and conditions on the reverse side. DE 20-2 ¶ 14. Gheblikian further stated that “[t]he bill of lading requires a specific disclosure of the value of the property only where the rate is dependent upon value . . . [h]owever, the instant rate was a flat rate, not dependent upon value.” Id. ¶¶ 15-16.
Tracy Harper, Vice President of Business Improvement of R&L Global Logistics, testified that Defendant R&L Truckload prepared the bill of lading but its employee, Darius Hamby, failed to submit an e-mail for approval through Defendant’s value shipment program breaking company policy. DE 20-3 at 24:13-25:21. Harper further testified that if Darius Hamby reported the value of the shipment the rate would not have changed, and that R&L Truckload does not necessarily quote anything besides flat rates. Id. at 27:10-19, 23:10-19.
The Court [*8] finds that the evidence shows that Defendants never offered a choice of rates, but rather the bill of lading applied a flat rate. Because there was no reasonable opportunity to choose between two or more levels of liability, Defendants may not rely on their affirmative defenses of limitation of liability. Defendants have not offered any evidence as to why their limited liability affirmative defenses are applicable, therefore summary judgment in favor of Plaintiff on these affirmative defenses is appropriate.
2. Notice of Claim
Plaintiff also seeks summary judgment on Defendants’ fourth affirmative defense regarding notice of claim: “R+L Global and R+L Truckload are not subject to liability under the Carmack Amendment insofar as Plaintiff failed to meet conditions precedent regarding claims submission.” DE 7 at 4. In response, Defendants state that they address this single issue in their briefing of Defendants’ Motion for Summary Judgment. See DE 23 at 3 n.2. Therefore, the issue of notice will be analyzed by the Court in the section below entitled “Defendants’ Motion for Summary Judgment.” See infra Section B.
3. Plaintiff’s Motion for Summary Judgment on its Affirmative Case
The Carmack Amendment to the [*9] Interstate Commerce Act imposes strict liability on common carriers “for actual loss of or damage to shipments in interstate commerce.” A.I.G. Uru. Compania de Seguros, S.A. v. AAA Cooper Transp., 334 F.3d 997, 1003 (11th Cir. 2003). To establish a prima facie case under the Carmack Amendment, plaintiff must prove “by a preponderance of the evidence that (1) the goods were delivered to the carrier in good condition, (2) the goods arrived at the destination in damaged condition, and (3) a specified amount of damages resulted.” Id. (citing Fine Foliage of Fla., Inc. v. Bowman Transp., Inc., 901 F.2d 1034, 1037 (11th Cir. 1990)). If a prima facie case is established, the burden then “shifts to the carrier to prove (1) that it was free from negligence, and (2) that the damage to the cargo was caused by one of the five excusable factors: ‘(a) the act of God; (b) the public enemy; (c) the act of the shipper himself; (d) public authority; (e) or the inherent vice or nature of the goods.'” Id. If the carrier is unable to meet this burden, then the carrier is held liable. Id.
The evidence on discovery establishes that the goods, a shipment of ammunition, were delivered to the carrier in good condition. Sworn testimony and Defendants’ admission demonstrate that on April 21, 2021, the shipment was tendered in good order and condition to the care, custody and control of the R&L Defendants. [*10] See Gheblikian Decl., DE 20-2 at ¶ 18; Defs. Answer, DE 7, ¶ 22 (admitting “that cargo was tendered for pickup in good order and condition”). Plaintiff has also proved that the ammunition arrived at the destination in damaged condition. The evidence presented shows that on or about April 23, 2021, the truck containing the cargo was involved in an accident where the truck overturned, resulting in damages to the freight. See Gheblikian Decl., DE 20-2 at ¶ 19; See Harper Dep. at 65. Also, as submitted to Defendant R&L Carriers in Plaintiffs Notice of Loss, there was a specified amount of damages, the value of the shipment for $711,800.00 plus the costs of mitigation for a total demand for $761,800.00. See 20-2 at 10-11. Defendants have not presented any evidence disputing Plaintiff’s prima facie case for violation of the Carmack Amendment, therefore summary judgment as to Count II shall be GRANTED.
4. Breach of Contract
Plaintiff, in its Response, argues that Defendants’ Motion for Summary Judgment fails to address Count I of the Complaint for breach of contract. See DE 22 at 9-10. Plaintiff further argues that even if R&L Carriers did not act as a Carmack carrier it still is responsible for breaching the [*11] instruction to insure the shipment. Id.
Although, Defendants have not made any argument as to the breach of contract claim, the Eleventh Circuit has characterized “the preemptive effect of the Carmack Amendment to be quite broad.” Megatrux Transp., Inc., 750 F.3d at 1289. “The Carmack Amendment embraces all losses resulting from any failure to discharge a carrier’s duty as to any part of the agreed transportation.” Id. (internal quotation omitted). “[S]eparate and distinct conduct rather than injury must exist for a claim to fall outside the preemptive scope of the Carmack Amendment.” Id.
Here, both Count I for breach of contract and Count II for violation of the Carmack Amendment are based on the same conduct, Defendants’ failure to deliver goods in the same condition as they were tendered and failure to procure appropriate insurance. See DE 1-1 ¶¶ 22-23. Because there is no evidence as to separate and distinct conduct, Count I is DISMISSED as preempted by Count II.
B. Defendants’ Motion for Summary Judgment
Defendants make one argument for summary judgment—that this case is premature because Plaintiff failed to satisfy the statutory condition precedent of submitting a claim to the proper carrier to evaluate the loss. See DE 21. Defendants cite a single case, Siemens, which held that “a shipper must [*12] file with the carrier a notice of a claim that satisfies § 1005.2(b) before filing suit under the Carmack Amendment.” Id. at 3 (citing Siemens Power Transmission & Distribution v. Norfolk & S. Ry., 420 F.3d 1243, 1245 (11th Cir. 2005)). Plaintiff argues that there is no notice requirement per se under the Carmack Amendment, and distinguishes Siemens, stating the Eleventh Circuit only dealt with the issue of “provisions relating to restrictions on carriers in setting notice of claim time periods.” DE 22 at 8 (citing Siemens, 420 F.3d at 1248).
Indeed, § 1005.2(b) contains minimum filing requirements:
A written or electronic communication (when agreed to by the carrier and shipper or receiver involved) from a claimant, filed with a proper carrier within the time limits specified in the bill of lading or contract of carriage or transportation and: (1) Containing facts sufficient to identify the baggage or shipment (or shipments) of property, (2) asserting liability for alleged loss, damage, injury, or delay, and (3) making claim for the payment of a specified or determinable amount of money, shall be considered as sufficient compliance with the provisions for filing claims embraced in the bill of lading or other contract of carriage; Provided, however, That where claims are electronically handled, procedures are established to ensure reasonable carrier access to supporting [*13] documents.
The Eleventh Circuit also found “that § 1005.2(b) should be interpreted liberally in light of its purpose, which is to provide the carrier adequate notice of the claim so that it can conduct an independent investigation of the damage, not to relieve the carrier of liability.” Siemens, 420 F.3d at 1245.
Regarding timing of submitting notice of loss, Section (e) of the Carmack Amendment provides that “[a] carrier may not provide by rule, contract, or otherwise, a period of less than 9 months for filing a claim against it under this section and a period of less than 2 years for bringing a civil action against it under this section.” Id. at 1248 (citing 49 U.S.C. § 14706(e). In Siemens, the uniform straight bill of lading required that, consistent with Section (e), the shipper must provide the carrier with a notice of claim for damages within nine months of delivery of the cargo as a condition precedent to recovery. Id. (citation omitted).
Here, the bill of lading did not have any terms and conditions on the reverse side. 20-2 ¶ 14. Plaintiff supplied notice of the claim to Defendant R&L Carriers via email on May 4, 2021, only 11 days after the subject loss. See id. at 10. Further, Defendants never denied the May 4, 2021, claim in violation of § 370.5. See 49 CFR 370.5(a) (“Each carrier shall, upon [*14] receipt in writing of a proper claim in the manner and form described in the regulations in the past, acknowledge the receipt of such claim in writing to the claimant within 30 days after the date of its receipt by the carrier unless the carrier shall have paid or declined such claim in writing within 30 days of the receipt thereof.”). As such, the Court finds that Plaintiff submitted timely notice.
Additionally, Defendants argue that “Plaintiff never filed a claim with R+L Truckload, who is the ‘proper’ carrier engaged by [Plaintiff], issued the bill of lading, and brokered to a delivering carrier to transport the cargo.” DE 21 at 4 (footnote omitted). Plaintiff responds that the entity it sent notice to, R&L Carriers, was the initial carrier of the shipment and the proper entity to receive notice of the subject loss.
Section 1005.2(b) requires a communication be “filed with a proper carrier within the time limits specified in the bill of lading or contract of carriage or transportation . . . .” (emphasis added). Here, the evidence shows that Plaintiff contacted R&L Carriers to obtain a quote for this shipment. DE 20-2 ¶ 6. Also “R&L Carriers” is in the heading of the bill of lading for the shipment [*15] in question. See 24-1. It is true, Defendant’s corporate representative testified that R&L Truckload generated the bill of lading. DE 20-3 at 16:21-24, 24:13-16. However, Defendants’ corporate representative also testified that she was not sure whether Plaintiff was ever informed that R&L Truckload was a subsidiary or related company. DE 20-3 at 61:22-25.
By its terms, the Carmack Amendment governs carriers, not brokers. 49 U.S.C. § 14706(a). “Whether a company is a broker or a carrier is not determined by what the company labels itself, but by how it represents itself to the world and its relationship to the shipper.” Hewlett-Packard Co. v. Brother’s Trucking Enterprises, Inc., 373 F. Supp. 2d 1349, 1352 (S.D. Fla. 2005) (citation omitted). “This is necessarily a case-specific analysis, and as a result, summary judgment might not be appropriate in many cases.” Essex Ins. Co. v. Barrett Moving & Storage, Inc., 885 F.3d 1292, 1302 (11th Cir. 2018) (citation omitted). “But the question need not always be difficult.” Id. “In any case, the operative inquiry is this: pursuant to the parties’ agreement, with whom did the shipper entrust the cargo?” Id.
In April of 2021, Aaron Gheblikian contacted Ann Shuster of R&L Carriers to obtain a quote for the shipment in question. DE 20-2 at ¶ 6. Plaintiff had previously done business with Ann Shuster and prior to the underlying accident R&L Carriers had performed motor carrier [*16] services for plaintiff. Id, ¶ 7. In light of the evidence submitted, the Court finds that Plaintiff entrusted its cargo to R&L Carriers because R&L Carriers held themselves out to be the carrier. Defendants’ corporate representative acknowledged that a claim was submitted to R&L Carriers. Harper Dep. DE 20-3 at 63:24-64:3. Therefore, Plaintiff submitted its notice of loss to the proper entity and satisfied the pre-suit notice of claim requirement pursuant to § 1005.2(b).
Accordingly, it is ORDERED, ADJUDGED, AND DECREED as follows:
1) Plaintiff’s Motion for Summary Judgment (DE 20) be, and the same is, hereby GRANTED IN PART as to Count II for violation of the Carmack Amendment;
2) Count I for breach of contract is DISMISSED as preempted by Count II;
3) Defendants’ Motion for Summary Judgment (DE 21) is hereby DENIED; and
4) Pursuant to Rule 58(a) of the Federal Rules of Civil Procedure, final judgment in favor of Plaintiff will be set out in a separate Order.
DONE AND ORDERED in Chambers at the James Lawrence King Federal Justice Building and United States Courthouse, Miami, Florida this 27th day of October, 2022.
/s/ James Lawrence King
JAMES LAWRENCE KING
UNITED STATES DISTRICT JUDGE
ORDER OF FINAL JUDGMENT
Pursuant to Federal Rule of Civil Procedure 58(a), and in accordance with the reasoning stated in [*17] the Court’s Order Granting in Part Plaintiff’s Motion for Summary Judgment (DE 25), it is hereby ORDERED, ADJUDGED, and DECREED that FINAL JUDGMENT is entered in favor of Plaintiff and against Defendant. The above-captioned case is hereby DISMISSED. All pending motions are DENIED as moot. The Pretrial Conference set for November 4, 2022, and Trial set for January 3, 2023, are hereby CANCELED. The Court retains jurisdiction to consider motions regarding fees and costs (if any are filed). The Clerk shall CLOSE this case.
DONE AND ORDERED in Chambers at the James Lawrence King Federal Justice Building and United States Courthouse, Miami, Florida, this 27th day of October, 2022.
/s/ James Lawrence King
JAMES LAWRENCE KING
UNITED STATES DISTRICT JUDGE
End of Document
1 The Court will consider the Parties’ Statements of Undisputed Facts despite both Plaintiff and Defendants failing to adhere to Local Rule Local Rule 56.1(a) which requires that “[a] motion for summary judgment and the opposition to it shall each be accompanied by a separate and contemporaneously filed and served Statement of Material Facts.” S.D. Fla. L.R. 56.1(a). Also, under subsection (b) the form the Statements of Material Facts are to take is that “[a]ll statements of Material Facts (whether filed by the movant or the opponent) shall be filed and served as separate documents and not as exhibits or attachments [*2] .” S.D. Fla. L.R. 56.1(b)(1) (emphasis added).
2 Defendants do not dispute the existence of this communication but rather argue in their Motion for Summary Judgment (DE 21) and Response to Plaintiff’s Motion for Summary Judgment (DE 23) that the communication was sent to the wrong entity, creating a dispute of law, not fact.
