United States District Court for the Central District of California
May 20, 2024, Decided; May 20, 2024, Filed
2024 U.S. Dist. LEXIS 91305 *
California Automobile Insurance Company v. Colonial Van Lines, Inc.
transported, interstate commerce, motion to dismiss, Carmack Amendment, contracted, preempts, material factual allegations, fail to state, no allegation, legal theory, interstate, documents, damaged, shipped, Notice
Counsel: [*1] For Colonial Van Lines Inc, Defendant: Jeffrey D Nadel, LEAD ATTORNEY, Jeffrey D Nadel Law Offices, Encino, CA USA; Jeffrey D Nadel, LEAD ATTORNEY, Jeffrey D Nadel Law Offices.
Judges: SUNSHINE S. SYKES, UNITED STATES DISTRICT JUDGE.
CIVIL MINUTES—GENERAL
Proceedings: (IN CHAMBERS) ORDER DENYING DEFENDANT’S MOTION TO DISMISS [Dkt. 15]
Before the Court is Defendant Colonial Van Lines, Inc.’s (“CVL”) motion to dismiss (the “Motion”) filed on January 8, 2024. [Dkt. 15]. This matter is fully briefed and ripe for review. [Dkt. 21; Dkt. 23]. In accordance with the opinion below, the Court DENIES CVL’s Motion. [Dkt. 15].
Introduction
Plaintiff California Automobile Insurance Company (“California Insurance”) is an insurance company that insured the property of one “Rusty Roberts” (“Roberts”). [Dkt. 1 at 2]. California Insurance alleges that on or about December 28, 2020, Roberts contracted with CVL to take custody of Roberts’ property and then transport Roberts’ property to an agreed upon location. [Dkt. 1-2 at 4].
California Insurance claims further that during the transportation of Roberts’ property, the property was stolen, resulting in $82,099.37 in damages. Id. Pursuant to the policy [*2] it had with Roberts, California Insurance paid Roberts the total value of the loss, and California Insurance now brings this action against CVL alleging claims for (1) breach of contract and (2) subrogation. [Dkt. 1-2 at 4-5].
Legal Standard
A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) tests the legal sufficiency of the claims in a complaint. Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001). Dismissal of a claim is proper under Rule 12(b)(6) when a plaintiff “fails to state a cognizable legal theory or fails to allege sufficient factual support for its legal theories.” Caltex Plastics, Inc. v. Lockheed Martin Corp., 824 F.3d 1156, 1159 (9th Cir. 2016). To survive a Rule 12(b)(6) motion, a plaintiff must allege sufficient facts to “state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 663, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007)).
In analyzing a motion to dismiss, a court must accept as true all material factual allegations and draw all reasonable inferences in the non-moving party’s favor. Doe v. U.S., 419 F.3d 1058, 1062 (9th Cir. 2005). A court need not accept, however, “a legal conclusion couched as a factual allegation.” Papasan v. Allain, 478 U.S. 265, 286, 106 S. Ct. 2932, 92 L. Ed. 2d 209 (1986). When reviewing a Rule 12(b)(6) motion, a court must consider the complaint in its entirety and any attached documents, documents incorporated by reference, or matters of which a court may take judicial notice. Tellabs, Inc. v. Makor Issues & Rights, Ltd., 551 U.S. 308, 322, 127 S. Ct. 2499, 168 L. Ed. 2d 179 (2007). If a complaint fails to state a plausible claim, a court should freely grant leave to amend under Federal Rule of Civil Procedure 15(a)(2) even if such a [*3] request was not made, unless amendment would be futile. Watison v. Carter, 668 F.3d 1108, 1117 (9th Cir. 2012).
Discussion
CVL’s arguments for dismissal hinge on whether the Carmack Amendment applies to Plaintiff’s Complaint. [See Dkt. 15 (arguing the Carmack Amendment preempts California Insurance’s claims and the claims are time-barred under the relevant statute of limitations). Thus, the first question before the Court is whether the Carmack Amendment applies. The Court decides it does not.
The Carmack Amendment provides the exclusive cause of action for claims arising out of interstate shipping contracts, and it 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) (citing Hall v. N. Am. Van Lines, 476 F.3d 683, 687-88 (9th Cir. 2007)). Put another way, the Carmack Amendment “imposes liability on a carrier for all losses relating to goods it transports in interstate commerce.” Chubb Grp. Of Ins. Comps. v. H.A. Transp. Sys., Inc., 243 F. Supp. 1064, 1069 (C.D. Cal. Oct. 9, 2022). Thus, for the Carmack Amendment to apply, the property that was damaged, lost, or delayed, must have been transported in interstate commerce. Id.
Here, the Carmack Amendment does not apply because there is no allegation in the Complaint establishing the property was transported in interstate commerce. [Dkt. 1]. In the Motion, CVL claims the Carmack Amendment applies because CVL shipped Roberts’ property from California to Arizona. [Dkt. 15 at 2]. However, the Complaint contains no allegations [*4] supporting this conclusion. [Dkt. 1-2 at 4 (alleging Roberts contracted with CVL to transport his property to “an agreed upon location”)]. In CVL’s Notice of Removal, CVL cites paragraphs six and eight of the Complaint as evidence of the “interstate shipment” of Roberts’ property. [Dkt. 1 at 2]. However, as discussed above, the Complaint does not allege Roberts’ property was transported by CVL from California to Arizona. [Dkt. 1-2]. Thus, because the Complaint does not state facts sufficient to show the property at issue was transported in interstate commerce, and the Court must accept as true all material factual allegations in the Complaint, the Carmack Amendment does not preempt California Insurance’s claims. See Chubb Grp, 243 F. Supp. at 1069; see also Ins. Co. of N. Am. V. NNR Aircargo Serv. (USA), Inc., 201 F.3d 1111, 1115 (9th Cir. 2000) (finding the Carmack Amendment does not apply where no evidence was presented that defendant would play a role in transporting the goods in interstate commerce).
Conclusion
As all CVL’s arguments for dismissal rest upon the Carmack Amendment applying to California Insurance’s claims, and the Carmack Amendment does not apply for the reason stated above, the Court DENIES CVL’s Motion. [Dkt. 15]. CVL is DIRECTED to file an Answer on or before June 3, 2024.
End of Document
