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Winter v. Cowart and DT Freight

United States District Court, N.D. Mississippi, Oxford Division.

Greg WINTER, individually, and on Behalf of All Wrongful Death Beneficiaries of Latricia Winter, Deceased, Plaintiff

v.

Tyrin COWART and DT Freight, LLC, Defendants

CIVIL ACTION NO. 3:23-CV-352-SA-RP

|

Signed October 23, 2024

Attorneys and Law Firms

James Ashley Ogden, Ogden and Associates, PLLC, Jackson, MS, for Plaintiff.

Carl K. Wyatt, Todd B. Murrah, Glassman Wyatt Tuttle & Cox, PC, Memphis, TN, for Defendants.

ORDER AND MEMORANDUM OPINION

Sharion Aycock, UNITED STATES DISTRICT JUDGE

*1 On August 10, 2023, Greg Winter, individually and on behalf of the wrongful death beneficiaries of Latricia Winter, initiated this lawsuit by filing his Complaint [2] in the Circuit Court of Marshall County, Mississippi. Winter named Tyrin Cowart; Blair Logistics, LLC; DT Freight, LLC; and Southeast Logistics & Transport as Defendants. The Defendants removed the case to this Court on September 11, 2023. Winter has since filed a Stipulation of Dismissal [71] as to Blair Logistics and Southeast Logistics & Transport, leaving only Cowart and DT Freight as Defendants.

Now before the Court is the Defendants’ Motion for Partial Summary Judgment [74]. The Motion [74] is ripe for review.

Relevant Background

This lawsuit stems from a fatal motor vehicle accident. The collision occurred on August 19, 2021 just prior to 6:00 AM on US Highway 72 in Marshall County, Mississippi. For reference, US Highway 72 is a four-lane highway with two lanes of eastbound traffic and two lanes of westbound traffic.

On the date in question, Tyrin Cowart was traveling westbound on US Highway 72 in a tractor-trailer. Although not an employee of DT Freight, Cowart was hauling a load for that entity. Cowart parked his tractor trailer on the right shoulder of the highway to check the load on his flat-bed trailer. Latricia Winter was also traveling westbound on US Highway 72 in a minivan on her way to work.

The collision between the two vehicles occurred when Cowart merged his truck back onto Highway 72 from the shoulder where he had been parked. Winter’s minivan struck the back of Cowart’s trailer. The collision occurred in the right lane of westbound traffic. Winter died at the scene.

This lawsuit followed. Greg Winter—Latricia Winter’s husband—brings the case on behalf of himself and all wrongful death beneficiaries. As to Cowart, Winter contends that Cowart acted negligently in multiple ways, such as failing to keep and maintain a proper lookout, failing to keep his vehicle under control, failing to maintain a proper distance from other vehicles, willfully disregarding the safety of others, failing to yield the right of way, failing to comply with the Federal Motor Carrier Safety Regulations and the applicable law, among others. Winter also asserts negligence claims against DT Freight, averring that it is vicariously liable for Cowart’s alleged negligent conduct. He also brings direct negligence claims against DT Freight for negligent hiring, negligent supervision, and failure to properly train.1

Standard

*2 Summary judgment is warranted when the evidence reveals no genuine dispute regarding any material fact, and the moving party is entitled to judgment as a matter of law. Fed. R. Civ. P. 56(a). Rule 56 “mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party’s case, and on which that party will bear the burden of proof at trial.” Nabors v. Malone, 2019 WL 2617240, at *1 (N.D. Miss. June 26, 2019) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 322, 106 S. Ct. 2548, 91 L. Ed. 2d 265 (1986)).

“The moving party ‘bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of the record which it believes demonstrate the absence of a genuine issue of material fact.’ ” Id. (quoting Celotex, 477 U.S. at 323, 106 S. Ct. 2548). “The nonmoving party must then ‘go beyond the pleadings’ and ‘designate specific facts showing that there is a genuine issue for trial.’ ” Id. (quoting Celotex, 477 U.S. at 324, 106 S. Ct. 2548). Importantly, “the inferences to be drawn from the underlying facts contained in the affidavits, depositions, and exhibits of record must be viewed in the light most favorable to the party opposing the motion.” Waste Mgmt. of La., LLC v. River Birch, Inc., 920 F.3d 958, 964 (5th Cir. 2019) (quoting Reingold v. Swiftships, Inc., 126 F.3d 645, 646 (5th Cir. 1997)). However, “[c]onclusory allegations, speculation, unsubstantiated assertions, and legalistic arguments are not an adequate substitute for specific facts showing a genuine issue for trial.” Nabors, 2019 WL 2617240 at *1 (citing TIG Ins. Co. v. Sedgewick James of Wash., 276 F.3d 754, 759 (5th Cir. 2002)) (additional citations omitted).

Analysis and Discussion

The Defendants seek dismissal of some—but not all—of Winter’s claims. More specifically, the Defendants argue:

The Court should dismiss (1) the direct negligence claims against DT Freight; (2) the claims for emotional distress, including charges for past and future medical or counseling services provided to the wrongful death beneficiaries of Mrs. Winter; (3) the negligence claims based on Mr. Cowart’s failure to place warning triangles while his vehicle was stopped and his alleged violation of the minimum speed statute; and (4) the claim for punitive damages.

[75] at p. 2-3.

The Court will address each of these arguments in turn.

The Defendants first seek dismissal of Winter’s direct negligence claims against DT Freight. They argue that the direct negligence claims pertaining to DT Freight’s alleged negligent hiring, negligent supervision, and failure to train should be dismissed because DT Freight has admitted vicarious liability. In response, Winter states that he “will withdraw [his] claims of negligent supervision, negligent entrustment, negligent hiring, and any other independent, direct negligence claims against DT Freight as long as DT Freight stipulates it is vicariously liable for all Tyrin Cowart’s actions.” [114] at p. 3.

“The Courts of this state have consistently dismissed independent negligence claims against an employer who admits vicarious liability for an employee’s actions.” Roberts v. Ecuanic Exp., Inc., 2012 WL 3052838, at *2 (S.D. Miss. July 25, 2012) (citations omitted). This is because “once an employer has admitted that it is liable for an employee’s actions, evidence pertaining only to issues of negligent hiring, entrustment, supervision, or maintenance becomes superfluous and possibly unfairly prejudicial.” Id. (citing Lee v. Harold David Story, Inc., 2011 WL 3047500, at *1 (S.D. Miss. July 25, 2011)).

*3 The parties’ agreement on this issue is in accordance with the applicable case law. Since DT Freight has stipulated to vicarious liability for Cowart’s actions, Winter’s direct negligence claims against DT Freight are redundant. They are hereby DISMISSED.

Next, the Defendants seek dismissal of all claims for “emotional distress, including charges for past and future medical or counseling services provided to the wrongful death beneficiaries of Mrs. Winter.” [75] at p. 2-3. To support this argument, the Defendants contend that a wrongful death cause of action is statutory and that the available damages are therefore limited to those damages specifically contemplated in the wrongful death statute. The Mississippi Supreme Court has held that the damages available under this statute “include (1) the present net cash value of the life expectancy of the deceased, (2) the loss of the companionship and society of the decedent, (3) the pain and suffering of the decedent between the time of injury and death, and (4) punitive damages.” McGowan v. Estate of Wright, 524 So. 2d 308, 311 (Miss. 1988) (citing Jesco, Inc. v. Whitehead, 451 So. 2d 706, 710 (Miss. 1984)) (additional citations omitted).

In response, Winter clarifies that he is not attempting to make a direct claim for emotional distress but that such treatment is relevant to the loss of companionship and society portion of available damages. Winter contends that he “will only seek to use their treatment to support [the] claims for damages but will not submit the bills or costs as a separate form of recoverable damage.” [114] at p. 4.

Thus, it appears that the parties agree that these expenses are not separately recoverable. However, the Defendants contend that evidence pertaining to counseling services is not admissible, and they specifically note that they intend to file a motion in limine on that topic.

The Court will take up any issues pertaining to admissibility at the appropriate time. But for purposes of the present filing, any direct claims for emotional distress are hereby DISMISSED.

The Defendants also seek summary judgment as to “the negligence claims based on Mr. Cowart’s failure to place warning triangles while his vehicle was stopped and his alleged violation of the minimum speed statute[.]” [75] at p. 3.

Federal Motor Carrier Safety Administration Regulation § 392.22 mandates the placement of warning devices in certain situations:

(b) Placement of warning devices—

(1) General rule. Except as provided in paragraph (b)(2) of this section, whenever a commercial motor vehicle is stopped upon the traveled portion or the shoulder of a highway for any cause other than necessary traffic stops, the driver shall, as soon as possible, but in any event within 10 minutes, place the warning devices required by § 393.95 of this subchapter[.]

49 C.F.R. § 392.22 (emphasis added).

Here, the evidence indicates that Cowart was stopped for approximately 10 minutes and 39 seconds, thus exceeding the 10-minute threshold set forth in the Regulation. He also admits that he did not place any warning devices on the road, despite having them in his vehicle. He testified that he did not place the warning devices because he did not intend to be stopped for more than 10 minutes. Nonetheless, there is no dispute that Cowart did not comply with the Regulation.

*4 As to the minimum speed limit, the applicable statute provides as follows:

(1) No motor vehicle shall be driven at a speed less than thirty miles per hour on federal designated highways where no hazard exists. An exception to this requirement shall be recognized when reduced speed is necessary for safe operation, or when a vehicle or combination of vehicles is necessarily, or in compliance with law or police direction, proceeding at a reduced speed.

Miss. Code Ann. § 63-3-509(1).

Here, there is no dispute that Cowart was traveling less than 30 miles per hour at the time of the collision. However, he contends that he was permitted to do so as he was driving a tractor-trailer which necessarily takes a longer period of time than a standard sized vehicle to reach the speed of 30 miles per hour.

In his Response Memorandum [114], Winter asserts that he does “not seek to introduce these violations as a form of strict liability, but a part of the negligence claim showing a violation of a duty.” [114] at p. 4.

Candidly, the Complaint [2] itself is not clear as to whether Winter desired to impose a strict liability standard as to these violations. However, in light of his concession in the Response Memorandum [114], to the extent any such claim was asserted in the Complaint [2], it is hereby DISMISSED. To the extent that the present Motion [72] seeks any additional relief, such as a ruling precluding the introduction of evidence pertaining to these violations, summary judgment is not the appropriate avenue to seek such relief, and the request is denied.

Finally, the Defendants seek summary judgment on Winter’s claim for punitive damages. They contend that there is no evidence of the requisite level to warrant such damages and, furthermore, that punitive damages are unavailable on a theory of vicarious liability. The Defendants cite authorities for these positions; however, Winter’s Response Memorandum [114] specifically withdraws the punitive damages claim. Therefore, the Court sees no need to address the issue any further. Winter will not be permitted to seek punitive damages in this case. All such claims are hereby DISMISSED.

Conclusion

For the reasons set forth above, the Defendants’ Motion for Partial Summary Judgment [74] is GRANTED IN PART and DENIED IN PART.

SO ORDERED, this the 23rd day of October, 2024.

All Citations

Slip Copy, 2024 WL 4556985

Footnotes  
1  As indicated above, the Complaint [2] also named Blair Logistics and Southeast Logistics & Transport as Defendants and asserted claims against those entities similar to those asserted against DT Freight. However, on August 14, 2024, the parties filed a Joint Stipulation of Dismissal [71] as to Blair Logistics and Southeast Logistics & Transport. The Stipulation [71] specifically provides that the dismissal of those parties “is based on Defendants’ representation that Defendant Cowart was an independent contractor with DT Freight, LLC at the time of the accident, and that the tractor trailer was being operated by Cowart on or about the business of DT Freight, LLC, and not Blair Logistics, LLC and Southeast Logistics & Transport.” [71] at p. 1. The Clerk of Court therefore terminated those parties as active Defendants in the case.  
End of Document  © 2024 Thomson Reuters. No claim to original U.S. Government Works.  

Sema Logistics Incorporated v. Alternative Heavy Towing Incorporated

United States District Court, D. Arizona.

SEMA LOGISTICS INCORPORATED, Plaintiff,

v.

ALTERNATIVE HEAVY TOWING INCORPORATED, Defendant.

No. CV-23-02098-PHX-KML

|

Signed November 5, 2024

Attorneys and Law Firms

Nicolette Glazer, Pro Hac Vice, Law Offices of Larry R. Glazer, Century City, CA, for Plaintiff.

Clarice A. Spicker, Phillip H. Stanfield, Damian Michael Zimmer, Jones Skelton & Hochuli PLC, Phoenix, AZ, for Defendant.

ORDER

Krissa M. Lanham, United States District Judge

*1 Plaintiff Sema Logistics Inc. brings federal and state causes of action against defendant Alternative Heavy Towing Inc. (“AHT”) stemming from AHT’s towing of Sema’s truck and trailer after the truck caught fire in a highway emergency. Sema brings state claims for conversion, consumer fraud, breach of contract, and promissory estoppel. It brings federal claims for apportionment under the Carmack Amendment and for declaratory judgment under the Declaratory Judgment Act.

AHT filed a motion to dismiss under Rule 12(b)(6) arguing it is exempt from the Carmack Amendment and that the Carmack Amendment preempts all Sema’s state law claims. It also argued that if the state law claims were not preempted, they still failed. The Carmack Amendment does not apply to AHT here because it provided emergency towing services to Sema. But that also means the Carmack Amendment does not preempt Sema’s state law claims, some of which have been adequately pleaded. Thus, the motion to dismiss is granted in part and denied in part.

I. Factual Background

Sema is a company providing the “door-to-door transportation of cars” and helps coordinate the transportation logistics throughout the United States. (Doc. 1 at 4.) It owns both a truck and a “high end” enclosed auto transport trailer. (Doc. 1 at 3.) AHT “represents to the public that it specializes in heavy duty towing[.]” (Doc. 1 at 4.) Sema’s truck caught on fire while it was hauling six cars in the trailer. (Doc. 1 at 4.) AHT “was called to tow the burnt truck and to rescue the cargo.” (Doc. 1 at 4.) AHT “safely towed the truck and the hooked [t]railer from the accident scene to its yard[.]” (Doc. 1 at 4.)

The day the truck was towed, Sema’s president “demanded the [t]railer’s immediate return and requested the amount owed for the towing.” (Doc. 1 at 5.) The next day, AHT provided Sema with an invoice for $1,265.00 for the tow. (Doc. 1 at 5.) AHT told Sema that “it would be unsafe” for them “to attempt to unload and remove the cars from the [t]railer without special equipment and offered to assist” Sema “with the unloading of the cargo to its yard, completion of the transportation, and/or to deliver the six cars to the consignees.” (Doc. 1 at 6) That day, AHT “unloaded and safely removed two of the cars” from the trailer but allegedly “refused to release” one of the other four cars to its owner “despite repeated demands” to do so. (Doc. 1 at 5.)

Thereafter AHT allegedly “refused to unload the remaining cars and to release them to their owners unless fully paid in advance.” (Doc. 1 at 6.) After a week of discussions between Sema and AHT, “[Sema’s] insurer issued a check [to AHT] for $4,550.50.” (Doc. 1 at 8.) Sema alleges AHT “confirmed” it “received the check” but that it “would not unload the remaining cars and would not detach the [t]railer from the burnt truck.” (Doc. 1 at 9.) AHT allegedly told Sema that the trailer “will remain at AHT as-is” and it would “store” one of the cars “until” Sema “either retrieve[s] the loaded tractor-trailer or agree[s] to [ ] additional services.” (Doc. 1 at 9.) At that time Sema alleges AHT “asserted possession, dominion, and control over the [t]railer and the cargo[.]” (Doc. 1 at 9.) Sema also alleges AHT failed to “perform under the[ir] oral contract … to unload the six cars” and “wrongfully asserted possession” over them. (Doc. 1 at 9.)

*2 AHT eventually released the truck and trailer. (Doc. 1 at 14.) Sema alleges that after it inspected the trailer it discovered that it “and the four cars [remaining on it] had been further damaged as a result of the units being left loaded and exposed to the elements for two months[.]” (Doc. 1 at 14.) Sema alleges “the fire did not cause this damage but [was] solely the result of [AHT’s] reckless and w[a]nton acts, conduct, and omissions” between the date of the tow and the release of the trailer. (Doc. 1 at 14.) As a result, Sema brings claims for conversion, consumer fraud, breach of contract, promissory estoppel, Carmack Amendment apportionment, and a declaration of rights. (Doc. 1 at 14–29.)

II. Legal Standard

“To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim to relief that is plausible on its face.’ ” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007) (internal citations omitted)). This is not a “probability requirement,” but a requirement that the factual allegations show “more than a sheer possibility that a defendant has acted unlawfully.” Id. A claim is facially plausible “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id. “[D]etermining whether a complaint states a plausible claim is context specific, requiring the reviewing court to draw on its experience and common sense.” Id. at 663–64.

III. Sema’s Carmack Amendment Claim Fails

Sema asserts a Carmack Amendment claim for apportionment. (Doc. 1 at 26–27 (citing 49 U.S.C. § 14706(b)).) But AHT is not liable under the Carmack Amendment here because of the statute’s emergency towing exception.1 Sema’s claim under the Carmack Amendment is therefore dismissed. But AHT’s argument that the Carmack Amendment globally preempts Sema’s state law claims—despite the statute’s inapplicability here—also fails. (See Docs. 18 at 6–7, 21 at 2–4.)

“The Carmack Amendment is a federal statute that provides 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.” Hall v. N. Am. Van Lines, Inc., 476 F.3d 683, 687–88 (9th Cir. 2007). The purpose of the Carmack Amendment was largely to provide “a uniform national liability policy for interstate carriers.” Id. (citing Hughes Aircraft Co. v. N. Am. Van Lines, Inc., 970 F.2d 609, 613 (9th Cir. 1992)). But certain “[m]iscellaneous motor carrier transportation” activities are exempted from the Carmack Amendment, including “the emergency towing of an accidentally wrecked or disabled motor vehicle.” 49 U.S.C. § 13506(b)(3). Thus, if AHT engaged in “emergency towing”—even of a carrier vehicle or cargo that would itself be subject to the Carmack Amendment—the Carmack Amendment does not apply. See Interstate Towing Ass’n, Inc. v. City of Cincinnati, Ohio, 6 F.3d 1154, 1158 n.4 (6th Cir. 1993) (interpreting the statutory predecessor to § 13506(b) as “indicat[ing] Congress’s intent not to preempt local towing services”).

*3 The emergency towing exception applies here. Emergency towing “happens in response to unforeseen circumstances requiring immediate attention.” Acuity Ins. Co. v. McDonald’s Towing & Rescue, Inc., 747 F. App’x 377, 381 (6th Cir. 2018). Here, Sema alleges its “truck caught on fire” on the highway and “AHT was called to tow the burnt truck and to rescue the cargo.” (Doc. 1 at 4.) As was the case in Acuity—in which the plaintiff’s truck broke down on the highway and the defendant was called to tow it—AHT’s tow qualifies as an emergency tow exempt from the Carmack Amendment. See id. at 378, 381–82.

When a defendant is exempt from the Carmack Amendment, state law claims are not preempted. See Hunter v. United Van Lines, 746 F.2d 635, 638 (9th Cir. 1985) (observing that plaintiffs’ contract claim would have been completely preempted if it had satisfied Carmack’s minimum amount in controversy); Gaede & Glaudert Assecuradeur GmbH & Co. KG v. Mesa Moving & Storage Boise, LLC, No. 117-CV-00354-EJL-CWD, 2018 WL 6843728, at *2 (D. Idaho Apr. 27, 2018) (“If the Carmack Amendment applie[d], then it would [have] preempt[ed] plaintiffs’ breach of contract claim.”) (citing Hall, 476 F.3d at 688) (emphasis added). Because AHT’s emergency tow is exempted from the Carmack Amendment, Sema’s apportionment claim is dismissed, but its state claims are not preempted.

IV. Sema Has Plausibly Pleaded a Conversion Claim

Sema alleges AHT “wrongfully and without authorization assumed and exercised control, dominion, possession, and/or ownership” over its personal property. (Doc. 1 at 14.) Arizona law defines conversion as “an intentional exercise of dominion or control over a chattel which so seriously interferes with the right of another to control it that the actor may justly be required to pay the other the full value of the chattel.” Miller v. Hehlen, 104 P.3d 193, 203 (Ariz. Ct. App. 2005) (simplified).

AHT does not counter Sema’s conversion claim with any legal arguments. (See Docs. 18 at 8–10, 21 at 5–6.) Instead, it alleges new facts not in Sema’s complaint and argues Sema’s conversion claim “will fail.” (Doc. 21 at 6.) But generally a court “may not consider any material beyond the pleadings in ruling on a Rule 12(b)(6) motion” and “factual disputes are not resolved in a motion to dismiss” because in that context the court must accept the complaint’s factual allegations as true.2 United States v. Corinthian Colleges, 655 F.3d 984, 999 (9th Cir. 2011) (citation omitted); Am. Bank of the N. v. Mouilso, No. CV-16-08207-PCT-GMS, 2018 WL 2065066, at *1 (D. Ariz. May 3, 2018). Instead, a Rule 12(b)(6) motion “tests the legal sufficiency of a claim” and claims can “be dismissed [under the rule] only if ‘it appears beyond doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to relief.’ ” Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001) (quoting Conley v. Gibson, 355 U.S. 41, 45–46 (1957)). Because Sema has pleaded ample facts to support its conversion claim (see Docs. 1 at 6, 8–13, 15–16), AHT’s motion to dismiss that claim is denied.

V. Sema’s Consumer Fraud Claim Fails

*4 Sema has not pleaded its consumer fraud claim with “particularity” as Rule 9(b) requires. It is well-established “in this circuit and elsewhere, that Rule 9(b)’s particularity requirement applies to state-law causes of action.” Yess v. Ciba-Geigy Corp. USA, 317 F.3d 1097, 1103 (9th Cir. 2003). “While a federal court will examine state law to determine whether the elements of fraud have been pleaded sufficiently to state a cause of action, the Rule 9(b) requirement that the circumstances of the fraud must be stated with particularity is a federally imposed rule.” Id. That requirement demands that the plaintiff plead “the who, what, when, where, and how of the misconduct charged.” Id. (quoting Kearns v. Ford Motor Co., 567 F.3d 1120, 1124 (9th Cir. 2009)) (simplified); see also Physicians Surgery Ctr. of Chandler v. Cigna Healthcare Inc., 609 F. Supp. 3d 930, 941 (D. Ariz. 2022) (noting Arizona’s consumer fraud statute is subjected to Rule 9(b)’s particularity requirements).

Arizona’s consumer fraud statute states that “[t]he act, use or employment by any person of any deception, deceptive or unfair act or practice, fraud, false pretense, false promise, misrepresentation, or concealment, suppression or omission of any material fact with intent that others rely on such concealment, suppression or omission, in connection with the sale or advertisement of any merchandise whether or not any person has in fact been misled, deceived or damaged thereby, is declared to be an unlawful practice.” Arizona Rev. Stat. § 44-1522(A) (emphasis added). Sema has not met its burden to plead a claim under the statute with particularity.

Although Sema allegedly made payments to AHT regarding the towing and storage of its property, Sema has not alleged any fraud “in connection with” that “sale or advertisement.” Arizona Rev. Stat. § 44-1522(A) (emphasis added). The only advertisements Sema’s complaint references are AHT’s claims to “provide accident and wreck recovery services … promot[ing] and represent[ing] to the public that it specializes in heavy duty towing[.]” (Doc. 1 at 4.) Sema was also aware that “[o]n its public-facing website [AHT] represents that ‘[t]ypically having your vehicle towed is not expensive, but storing your vehicle does have a tendency to add up rapidly since it accumulates daily.” (Doc. 1 at 5.) But far from alleging either of these claims were fraudulent, Sema says “AHT safely towed the[ir] truck and the hooked Trailer from the accident scene to its yard[.]” (Doc. 1 at 4.) Additionally, Sema’s complaint does not make clear that it was Sema who called AHT to tow its trailer, which means it may not have relied on AHT’s representations at all. (Doc. 1 at 4.)

Sema alleges it has standing to bring this claim because it “is a direct victim of the illegal, unfair, and fraudulent business practices described in this Complaint in which [AHT] engaged in solely for their financial benefit while providing and advertising AHT’s towing and transportation services.” (Doc. 1 at 17.) Because it is not clear what advertisement Sema is referring to, when or where it saw the advertisement, and how that advertisement affected it, this allegation does not help Sema plead its consumer fraud claim with particularity as required by Rule 9(b). In other words, Sema has alleged the “who” of the alleged fraud (AHT), but it has not pleaded the “what, when, where, and how” of it. See Yess, 317 F.3d at 1097. As a result, Sema has not pleaded with particularity that AHT committed consumer fraud in connection with a sale or advertisement.

Sema likewise fails to plead unfair acts or practices which caused it “consequent and proximate injury resulting from [a] promise” as an Arizona consumer fraud claim requires. See Kuehn v. Stanley, 91 P.3d 346, 351 (Ariz. Ct. App. 2004) (citing Correa v. Pecos Valley Dev. Corp., 617 P.2d 767, 771 (Ariz. Ct. App. 1980)). “An injury occurs when a consumer relies, even unreasonably, on false or misrepresented information.” Id. Sema alleges AHT was injured because AHT “diminish[ed]” its property rights “to obtain money without authority or justification.” (Doc. 1 at 17.) It also alleges that AHT “uttered multiple false and/or misleading statements with the intent that [Sema] and others rely upon such misstatement …” (Doc. 1 at 17.) This is not enough to satisfy Rule 9(b)’s particularity requirement because, again, Sema does not allege the what, where, when, and how of this alleged fraud, only the who (AHT). See Yess, 317 F.3d at 1097.

*5 Sema’s other allegations of unfair acts or practices are not for injuries it has suffered but instead for injuries it may suffer in the future. (See Doc. 1 at 17 (alleging “schemes” that hurt “other individuals and entities” who are “in need of towing services”); Doc. 1 at 18 (alleging harm to “affected parties” or an “owner/insurer”); see also Doc. 1 at 19–23.) These allegations are not sufficient to allege with particularity that AHT committed fraud and harmed Sema as a result as Rule 9(b) requires. For these reasons, Sema’s consumer fraud claim is dismissed.3

VI. Sema Has Adequately Pleaded Breach of Contract and Promissory Estoppel

AHT seeks dismissal of Sema’s promissory estoppel claim by arguing a plaintiff may not recover for breach of contract and promissory estoppel on the same facts. (Doc. 18 at 13.) AHT also argues Sema’s promissory estoppel claim should be dismissed because it “will be unable to meet its burden[.]” (Doc. 18 at 14.) These arguments fail.

AHT’s apparent belief that a complaint cannot allege alternative theories of recovery is incorrect because “a plaintiff can pursue multiple, even if inconsistent, theories of recovery in the same suit[.]” Anderson v. Edward D. Jones & Co., L.P., 990 F.3d 692, 701 (9th Cir. 2021). AHT cites to cases asserting that promissory estoppel is an alternative to a contract claim and is only available in the absence of a contractual remedy (Doc. 18 at 13), but that has no bearing on whether both claims may proceed past the motion-to-dismiss stage.

AHT’s claim that Sema “will be unable to meet its burden” as to its breach of contract claim fails because Sema must only plausibly plead that claim to survive a motion to dismiss. (Doc. 18 at 13–14.) See Iqbal, 556 U.S. at 678 (quoting Bell Atl. Corp., 550 U.S. at 555 (internal citations omitted)). In Arizona, a party asserting a claim for breach of contract must prove (1) the existence of the contract, (2) a breach of that contract, and (3) resulting damages. Chartone, Inc. v. Bernini, 83 P.3d 1103, 1111 (Ariz. Ct. App. 2004). As for the first element, “[f]or an enforceable contract to exist, there must be an offer, an acceptance, consideration, and sufficient specification of terms so that obligations involved can be ascertained.” K-Line Builders, Inc. v. First Fed. Sav. & Loan Ass’n, 677 P.2d 1317, 1320 (Ariz. Ct. App. 1983) (quoting Restatement (Second) of Contracts § 50). Sema has plausibly pleaded these elements.

Sema alleges AHT provided it with an invoice “representing the alleged charges for the towing.” (Doc. 1 at 5.) It also asserts AHT “offered to assist Sema Logistics with the unloading of the cargo to its yard[.]” (Doc. 1 at 6.) Sema “accepted the offer in part and orally agreed to hire and compensate” AHT. (Doc. 1 at 6.) AHT then “unloaded and safely removed two of the cars from the [t]railer.” (Doc. 1 at 6.) But AHT allegedly “refused to release [one car] to its owner despite repeated demands” and “refused to unload the remaining cars and to release them to their owners unless [Sema] fully paid in advance.” (Doc. 1 at 6.) Sema makes additional claims regarding the alleged contract with AHT and AHT’s alleged breach. (See Doc. 1 at 7–13.) Thus, Sema has pleaded sufficient facts, taken as true, to plead a breach of contract claim. AHT’s argument that there is a “vast amount of evidence in this case [that] refutes [Sema’s] claims” (Doc. 18 at 13) is inappropriate in the context of a motion to dismiss.

*6 Likewise, Sema need only plausibly allege promissory estoppel to survive a motion to dismiss. See Iqbal, 556 U.S. at 678 (quoting Bell Atl. Corp., 550 U.S. at 555 (internal citations omitted)). A promissory estoppel claim allows a plaintiff to recover for detrimental reliance on a promise. Higginbottom v. State, 51 P.3d 972, 977 (Ariz. App. Ct. 2002). In Arizona this claim requires “a promise[ ] which the promissor should reasonably foresee would cause the promisee to rely [on and] upon which the promisee actually relies to his detriment.” Contempo Constr. Co. v. Mountain States Tel. & Tel. Co., 736 P.2d 13, 16 (Ariz. App. Ct. 1987). Additionally, claims of promises for purposes of promissory estoppel must be specifically pleaded in Arizona. See Tiffany Inc. v. W.M.K. Transit Mix, Inc., 493 P.2d 1220, 1224 (Ariz. 1972). Sema alleges AHT made “promises that induced [Sema] to leave the [t]railer at [AHT’s] yard with the expectation that [AHT] would unload the six cars as promised and to direct its insurer to pay the full compensation requested by [AHT].” (Doc. 1 at 25.) Sema alleges they “relied” on those promises “to their detriment and tendered $4,555.50” to AHT as AHT had requested. (Doc. 1 at 25.)

Sema has specifically pleaded a promise that it relied on to its detriment and which AHT should reasonably have foreseen Sema would rely on. AHT’s motion to dismiss Sema’s promissory estoppel claim is therefore denied.

VII. Sema’s “Declaration of Rights” Claim Fails and is Dismissed

Sema makes a claim for a “declaration of rights” by “seek[ing] a judicial declaration” as to certain facts—such as one asserting that AHT’s “demand and retention of $4,555.50 was unlawful”—and it requests a mandatory injunction to restrain AHT’s future actions like “charg[ing] fees for [ ] transportation and storage after a release form, demand for return, and payment has been made.” (Doc. 1 at 28–29.)

It is not clear under which statute Sema makes this claim, but because the dismissal of Sema’s Carmack Amendment claim leaves the court with only jurisdiction via diversity of citizenship and a declaration of rights “is procedural, not substantive[,]” the federal Declaratory Judgment Act applies. Anderson v. Everest Nat. Ins. Co., 984 F. Supp. 2d 974, 977 (D. Ariz. 2013) (citing Skelly Oil Co. v. Phillips Petroleum Co., 339 U.S. 667, 671 (1950)); West Publ’g Co. v. McColgan, 138 F.2d 320, 324 (9th Cir. 1943) (citing Aetna Life Ins. Co. v. Haworth, 300 U.S. 227, 240 (1937)) (“The Federal Declaratory Judgment Act was not a jurisdiction-conferring statute, but an act to establish a new procedure in the federal courts … ‘Thus, the operation of the Declaratory Judgment Act is procedural only.’ ”).

With one possible exception that does not apply here, the Declaratory Judgment Act does not create a cause of action; it “creates a remedy, not rights.” City of Reno v. Netflix, Inc., 52 F.4th 874, 878 (9th Cir. 2022) (citing Malhan v. Sec. U.S. Dep’t of State, 938 F.3d 453, 457 n.3 (3d Cir. 2019)); see also id. at 878–79 (collecting cases); cf. id. at 879 (permitting a defensive declaratory judgment claim in the patent context). Insofar as Sema asserts a standalone declaratory judgment claim, that claim is dismissed.

VIII. Conclusion

Sema’s Carmack Amendment claim is dismissed because AHT is exempt from the statute under the emergency tow exception. Sema’s state law claims are not subject to Carmack preemption, but its consumer fraud claim is dismissed because it does not meet the requisite pleading standard. Sema’s declaratory judgment claim is also dismissed because the Declaratory Judgment Act establishes a remedy, not a cause of action. Sema’s conversion, breach of contract, and promissory estoppel claims may proceed.

Accordingly,

IT IS ORDERED that the Motion to Dismiss (Doc. 18) is GRANTED IN PART and DENIED IN PART. Plaintiff’s Carmack Amendment apportionment and standalone Declaratory Judgment Act claims are dismissed without leave to amend. Its consumer fraud claim is dismissed with leave to amend. If plaintiff wishes to amend its consumer fraud claim, it shall file an amended complaint no later than November 20, 2024. If no amended complaint is filed by that date, defendant shall file its answer no later than November 27, 2024. If an amended complaint is filed, defendant shall respond to the amended complaint as required by the applicable rule. Sema’s conversion, breach of contract, and promissory estoppel claims may proceed.

All Citations

Slip Copy, 2024 WL 4680579

Footnotes  
1  The parties also discuss the applicability of 49 C.F.R. §§ 390.23 and 395.3. (Docs. 18 at 7, 19 at 10, 21 at 4.) But those regulations appear to only apply to the maximum number of hours certain drivers may work. See Acuity Ins. Co. v. McDonald’s Towing & Rescue, Inc., 747 F. App’x 377, 381 n.1 (6th Cir. 2018) (“Section § 390.23 is part of the regulatory scheme for motor carrier safety, whereas the Carmack Amendment focuses on economic liability for cargo damages.”) As such, the court does not consider those regulations here.  
2  Although documents “incorporated into the complaint by reference[,]” are an exception to this rule, it is not clear that the phone call AHT references (Doc. 18 at 9) is the same one Sema refers to in its complaint. (Doc. 1 at 9–10). The court therefore declines to consider AHT’s factual assertions regarding a “phone call” between the parties. (See Doc. 18 at 9.)  
3  Sema alleges in its consumer fraud claim that AHT violated Arizona’s towing laws. (See Docs. 1 at 20, 19 at 16 (citing Arizona Rev. Stat. § 28-4847).) It is not clear if that statute allows for a private right of action, but in any event, because the court has dismissed the consumer fraud claim referring to the towing statute, the court need not analyze that issue.  
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