November 2024

Carey and Carey v. First String Space, Inc.

United States District Court, M.D. Florida.

JAMES CAREY and DEBRA CAREY, Plaintiffs,

FIRST STRING SPACE, INC., Defendant.

Case No. 3:22-cv-940-MMH-LLL

09/13/2024

ORDER

*1 THIS CAUSE is before the Court on Defendant First String Space, Inc.’s Motion for Final Summary Judgment and Incorporated Memorandum of Law (Doc. 70; Motion) filed by First String Space, Inc. (First String) on July 16, 2024. Plaintiffs James and Debra Carey (the Careys) filed a response on August 12, 2024. See Plaintiffs’ Response to First String Space, Inc.’s Motion for Summary Judgment [DE 70] (Doc. 75; Response). First String then filed a reply. See Defendant’s Reply in Support of Motion for Summary Judgment and Incorporated Memorandum of Law (Doc. 78; Reply), filed August 26, 2024. Accordingly, this matter is ripe for review.

I. Background¹

What minimal discovery and admissions the parties have presented to the Court reveal the following facts. In May 2020, the Careys were driving north on I-95 when their vehicle was struck by a rogue wheel, which landed on and lodged into the front of their truck. Deposition of James Carey (Doc. 70 Ex. A; J. Carey Dep.) at 45;² Florida Traffic Crash Report (Doc. 75-1; Crash Report) at 2–3. The wheel had fallen off a tractor–trailer being driven southbound by Mathew Davis. Crash Report at 2–3. After the wheel came off of Davis’s rig, it crossed the median into the northbound lanes, where it hit the Careys’ vehicle. Id. The tractor, owned by Bennett Truck Transport, LLC (Bennett), was hauling a mobile office trailer manufactured by First String. Id. at 1; Defendant, Bennett Truck Transport, LLC’s Responses to Plaintiffs’ Interrogatories (Doc. 75-2; Bennett Interrogatories) at 2.³ First String had ordered the wheel axle assembly from Ace Tire and Axel, LLC (Ace). Brandon Burkett’s Affidavit in Support of Defendant First String Space, Inc.’s Motion for Final Summary Judgment (Burkett Affidavit; Doc. 70 Ex. C) at 2. And, First String attached the wheel axle assembly to the trailer without modifying it. Id. The Careys have little or no personal knowledge as to how the wheel came off. See J. Carey Dep. at 30 (James Carey saying that he doesn’t “know anything about” how the tire became dislodged); Deposition of Debra Carey (Doc. 70 Ex. B; D. Carey Dep.) at 24 (Debra Carey saying that neither of them inspected the wheel or tried to determine what kind of vehicle it came from).

*2 On July 27, 2022, the Careys sued Davis and Bennett in state court for injuries allegedly caused by the crash. Defendants’ Notice of Removal of Florida State Court Litigation Pursuant to 28 U.S.C. §§ 1332(a) & 1441(b) (Doc. 1) at 1. Davis and Bennett removed the action to this Court. Id. On January 26, 2023, the Careys moved to add First String and Ace as additional Defendants. See Plaintiff’s Motion for Leave to File Amended Complaint (Doc. 17; Motion for Amended Complaint) at 1–2. After about a year of litigation, on July 18, 2023, the Careys filed their Second Amended Complaint (the operative pleading) against Bennett, Davis, First String, and Ace (Doc. 41). The Court dismissed the claims against Ace for failure to state a claim on October 27, 2023. See Order of Dismissal (Doc. 58) at 14. Additionally, the Careys settled with Bennet and Davis in July 2024, and the Court then dismissed the claims against them. See generally Joint Stipulation for Order of Dismissal with Prejudice Pursuant to Rule 41 (Doc. 68); Order (Doc. 73). As such, the claims that are the subject of the Motion are the claims in Counts V and VI of the Second Amended Complaint—the only claims still pending in the case.

II. Legal Standard

Under Rule 56 of the Federal Rules of Civil Procedure (Rule(s)), “[t]he court shall grant summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.” Rule 56(a). The record to be considered on a motion for summary judgment may include “depositions, documents, electronically stored information, affidavits or declarations, stipulations (including those made for purposes of the motion only), admissions, interrogatory answers, or other materials.” Rule 56(c)(1)(A).⁴ An issue is genuine when the evidence is such that a reasonable jury could return a verdict in favor of the nonmovant. See Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir. 1996) (quoting Hairston v. Gainesville Sun Publ’g Co., 9 F.3d 913, 919 (11th Cir. 1993)). “[A] mere scintilla of evidence in support of the non-moving party’s position is insufficient to defeat a motion for summary judgment.” Kesinger ex rel. Est. of Kesinger v. Herrington, 381 F.3d 1243, 1247 (11th Cir. 2004) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986)).

The party seeking summary judgment bears the initial burden of demonstrating to the court, by reference to the record, that there are no genuine issues of material fact to be determined at trial. See Clark v. Coats & Clark, Inc., 929 F.2d 604, 608 (11th Cir. 1991). For the moving party to meet its initial burden, it may “ ‘point out to the district court … that there is an absence of evidence to support the nonmoving party’s case.’ ” Gonzalez v. Lee Cnty. Housing Auth., 161 F.3d 1290, 1294 (11th Cir. 1998) (quoting Celotex Corp. v. Catrett, 477 U.S. 317, 325 (1986)) (alteration omitted). “When a moving party has discharged its burden, the non-moving party must then go beyond the pleadings, and by its own affidavits, or by depositions, answers to interrogatories, and admissions on file, designate specific facts showing that there is a genuine issue for trial.” Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590, 593–94 (11th Cir. 1995) (internal citations and quotation marks omitted). Substantive law determines the materiality of facts, and “[o]nly disputes over facts that might affect the outcome of the suit under the governing law will properly preclude the entry of summary judgment.” Anderson, 477 U.S. at 248. “If the non-moving party fails to ‘make a sufficient showing on an essential element of her case with respect to which she has the burden of proof,’ then the court must enter summary judgment for the moving party.” Gonzalez, 161 F.3d at 1294 (quoting Celotex, 477 U.S. at 323). In determining whether summary judgment is appropriate, a court “must view all evidence and make all reasonable inferences in favor of the party opposing summary judgment.” Haves v. City of Miami, 52 F.3d 918, 921 (11th Cir. 1995) (citing Dibrell Bros. Int’l, S.A. v. Banca Nazionale Del Lavoro, 38 F.3d 1571, 1578 (11th Cir. 1994)).

III. Discussion

*3 The Careys each assert a single negligence claim against First String. Second Amended Complaint at 8–11. They allege that First String “was negligent in that [it] engaged in faulty assembly of the undercarriage trailer and mobile office[.]” Id. ¶¶ 27, 31. First String argues in the Motion that the Careys “cannot produce evidence demonstrating” the required elements of a claim of negligence: duty, breach, and causation. Motion at 8. In the Response, the Careys admit that “there is no record evidence, no direct proof, of negligence,” and argue instead that the undisputed facts establish a prima facie case of negligence under the doctrine of res ipsa loquitur. See Response at 3–6. First String argues in the Reply that res ipsa loquitur is unavailable to the Careys primarily because they have failed to satisfy the first and third elements of the doctrine. Reply at 6. For the reasons that follow, the Motion is due to be granted because the record establishes that the Careys cannot present evidence supporting a prima facie case of negligence. This is so because they acknowledge they have no direct evidence of negligence and the undisputed material facts do not support the application of the doctrine of res ipsa loquitur.

Under Florida law, a plaintiff must prove four elements to prevail on a negligence claim:

“1. A duty, or obligation, recognized by the law, requiring the [defendant] to conform to a certain standard of conduct, for the protection of others against unreasonable risks.

2. A failure on the [defendant’s] part to conform to the standard required: a breach of the duty[.]

3. A reasonably close causal connection between the conduct and the resulting injury. This is what is commonly known as ‘legal cause,’ or ‘proximate cause,’ and which includes the notion of cause in fact.

4. Actual loss or damage[.]” Clay Elec. Coop., Inc. v. Johnson, 873 So. 2d 1182, 1185 (Fla. 2003) (quoted authority omitted) (first and second alterations in original). Res ipsa loquitur is “a rule of evidence” that permits an inference of negligence. McDougald v. Perry, 716 So. 2d 783, 785 (Fla. 1998) (quoting Marrero v. Goldsmith, 486 So. 2d 530,

531 (Fla. 1986)). However, it is available “in rare instances.” Id. (quoting Goodyear Tire & Rubber Co. v. Hughes Supply, Inc., 358 So. 2d 1339, 1341 (Fla. 1978)). The Florida Supreme Court has explained that res ipsa loquitur

provides an injured plaintiff with a common-sense inference of negligence where direct proof of negligence is wanting, provided certain elements consistent with negligent behavior are present. Essentially the injured plaintiff must establish that the instrumentality causing his or her injury was under the exclusive control of the defendant, and that the accident is one that would not, in the ordinary course of events, have occurred without negligence on the part of the one in control.

Id. (quoting Marrero, 486 So. 2d at 531).

As the parties agree, see Response at 3–4; Reply at 5, under Florida law, the applicability of the doctrine of res ipsa loquitur depends on the Careys’ ability to establish three elements: (1) “direct proof of negligence is wanting”; (2) the instrumentality causing the injury was “under the exclusive control of the defendant”; and (3) “the accident is one that would not, in the ordinary course of events, have occurred without” the defendant’s negligence. Goodyear, 358 So. 2d at 1341–42. To receive the benefit of the permissive res ipsa loquitur inference of negligence, the plaintiff must show evidence of each of the three elements. See City of New Smyrna Beach Utils. Comm’n v. McWhorter, 418 So. 2d 261, 263 (Fla. 1982) (“The [plaintiffs] … failed to allege, much less prove, any of the [elements]. …. By so limiting their presentation of evidence, the [plaintiffs] failed to carry their initial burden of proof and neglected to demonstrate the necessary elements of the doctrine. This oversight alone precludes application of res ipsa loquitur and proves fatal to their cause.”).

Turning to the requirements of the first element of the doctrine, a plaintiff must establish that “direct proof of negligence is wanting.” Goodyear, 358 So. 2d at 1341–42. In other words, the question is whether there is sufficient evidence available to the plaintiff to permit the plaintiff to establish the elements of negligence. Compare McDougald, 716 So. 2d at 787 (permitting a res ipsa loquitur instruction when “there was insufficient evidence available to [the plaintiff]” and “[t]he likely cause of th[e] accident, the chain and securing device, were in the exclusive possession of [the defendants] and were not preserved”) with Goodyear, 358 So. 2d at 1342 (refusing to permit a res ipsa loquitur instruction when “the facts surrounding the incident were discoverable and provable”). Importantly, a plaintiff bears the burden of showing the unavailability of evidence of negligence, not just the absence of evidence in the record. City of New Smyrna Beach, 418 So. 2d at 262 (noting that only after a plaintiff carries the burden of proof as to each requisite element of the doctrine may the court permit consideration of the res ipsa loquitur inference). Indeed, res ipsa loquitur does not provide a shortcut past discovery and straight to the jury box; instead, the doctrine gives a plaintiff the chance to make it to the jury in the rare case where reasonable discovery efforts have yielded nothing. See, e.g., Morhardt v. Carnival Corp., 304 F. Supp. 3d 1290, 1297–98 (S.D. Fla. 2017) (granting summary judgment in the defendant’s favor when “a proper investigation of the allegations in the Complaint might have produced direct evidence of [the defendant’s] alleged negligence”) (abrogated on other grounds by Tesoriero v. Carnival Corp., 965 F.3d 1170, 1181–82 (11th Cir. 2020)).⁵

*4 Here, First String satisfied its initial burden by demonstrating the “absence of evidence to support [the Careys’] case.” See Gonzalez v. Lee Cnty. Housing Auth., 161 F.3d 1290, 1294 (11th Cir. 1998) (quoted). First String provided the Careys’ depositions, in which the Careys offer no personal knowledge as to the cause of the wheel becoming detached. See J. Carey Dep. at 30; D. Carey Dep. at 24. First String also provided an affidavit from a First String employee who states that First String attached the wheel axle assembly to the trailer unmodified. Burkett Affidavit at 2. The Careys do not attempt to rebut First String’s evidence by providing their “own affidavits, … depositions, answers to interrogatories, and admissions … [that] designate specific facts showing that there is a genuine issue for trial.” See Jeffery v. Sarasota White Sox, Inc., 64 F.3d 590, 593–94 (11th Cir. 1995) (quoted) (internal citations and quotation marks omitted). Instead, the Careys admit that “there is no record evidence, no direct proof, of negligence causing the wheel to become dislodged.” Response at 4. Thus, as to the element of breach, the Careys “fail[ ] to make a sufficient showing on an essential element … with respect to which [they] ha[ve] the burden of proof.” See Gonzalez, 161 F.3d at 1294 (quoted).

Instead of pointing to any evidence that would be sufficient to establish the essential elements of negligence, the Careys seek to show a triable issue as to the elements of res ipsa loquitur. But the Careys again fail to produce any evidence to satisfy an essential element: that “direct proof of negligence is wanting.” See Goodyear, 358 So. 2d at 1341 (quoted). Their entire argument as to this element consists of the statement that “there is no record evidence, no direct proof, of negligence causing the wheel to become dislodged.” Response at 4. But the Careys’ burden as to the first element is not satisfied by pointing to an empty record; rather, to prevail, they must show that “there was insufficient evidence available” to them. See McDougald, 716 So. 2d at 787 (quoted). This, they have not done. The Careys do not provide any evidence that interrogatories were left unanswered. They do not provide any evidence that First String’s representatives—or any other deposable person—could not be deposed. They do not provide any evidence that the truck, tractor, trailer, wheel, axle assembly, or any other object could not be inspected by them or by a chosen expert. Nor do they suggest that First String or any other Defendant hindered their discovery efforts. Indeed, on this record, it is unclear what, if any, efforts (aside from serving the Bennett Interrogatories) the Careys made to identify proof of negligence much less determine how or why the wheel became dislodged.

The evidence of record does not suffice to create a triable issue as to the breach of duty by First String, an “essential element of [their] case … with respect to which [they] ha[ve] the burden of proof[.]” See Gonzalez, 161 F.3d at 1294 (quoted). Accordingly, the Careys have not met their burden under Rule 56. Moreover, the evidence simply does not support a conclusion that potential evidence of negligence either did not exist or was unavailable to the Careys.⁶ As such, the Careys cannot benefit from the permissive inference of negligence that arises from the application of the doctrine of res ipsa loquitur. See Goodyear, 358 So. 2d at 1342. Because the Careys acknowledge that there is no affirmative evidence of First String’s negligence, and no other basis for a jury to find First String liable has been offered, summary judgment is due to be entered in favor of First String. As such, the Motion is due to be granted.

Accordingly, it is

ORDERED:

1. Defendant First String Space, Inc.’s Motion for Final Summary Judgment and Incorporated Memorandum of Law is GRANTED.

*5 2. The Clerk of the Court is directed to enter JUDGMENT in favor of Defendant First String Space, Inc. and against James and Debra Carey.

3. The Clerk of the Court is further directed to terminate any pending motions and deadlines as moot and close the file.

DONE AND ORDERED in Jacksonville, Florida this 13th day of September, 2024.

lc33

Copies to:

Counsel of Record

All Citations

Slip Copy, 2024 WL 4188361

Footnotes
¹	Unless otherwise noted, the facts recited herein are undisputed. For the purpose of summary judgment, the Court views all disputed facts and reasonable inferences in the light most favorable to the Careys. See Haves v. City of Miami, 52 F.3d 918, 921 (11th Cir. 1995) (describing the summary judgment standard).
²	Throughout this Order, citations to page numbers are to the page numbers generated by the Court’s Electronic Filing System (CM/ECF).
³	The Careys provide conflicting evidence about who owned the tractor. Compare Traffic Report at 1 (stating that Bennett owned the tractor) with Bennett Interrogatories at 2 (stating that Davis owned the tractor). Whatever dispute may exist regarding who owned the tractor is immaterial to resolving the Motion.
⁴	Rule 56 was revised in 2010 “to improve the procedures for presenting and deciding summary-judgment motions.” Rule 56 Advisory Committee’s Note 2010 Amends. The standard for granting summary judgment remains unchanged. The language of subdivision (a) continues to require that there be no genuine dispute as to any material fact and that the movant be entitled to judgment as a matter of law. The amendments will not affect continuing development of the decisional law construing and applying these phrases. Id. “[A]lthough the interpretations in the advisory committee[’s] notes are not binding, they are highly persuasive.” Campbell v. Shinseki, 546 F. App’x 874, 879 n.3 (11th Cir. 2013). Thus, case law construing the former Rule 56 standard of review remains viable and is applicable here. In citing to Campbell, the Court notes that it does not rely on unpublished opinions as binding precedent, but that they may be cited in this Order when the Court finds them persuasive on a particular point. See McNamara v. GEICO, 30 F.4th 1055, 1060–61 (11th Cir. 2022); see generally Fed. R. App. P. 32.1; 11th Cir. R. 36–2 (“Unpublished opinions are not considered binding precedent, but they may be cited as persuasive authority.”).
⁵	The Court notes that although decisions of other district courts are not binding, they may be cited as persuasive authority. See Stone v. First Union Corp., 371 F.3d 1305, 1310 (11th Cir. 2004) (noting that “[a]lthough a district court would not be bound to follow any other district court’s determination, the decision would have significant persuasive effects”).
⁶	The Careys also argue that res ipsa loquitur is appropriate because the second and third elements are satisfied. But, because applying res ipsa loquitur requires the Careys to meet all three elements, the Court finds it unnecessary to address these arguments.

End of Document

Peterfai and Peterfai v. USA Logistics et al.

United States District Court, S.D. California.

LASZLO G. PETERFAI, an individual, SARAH JANE PETERFAI, an individual, and on behalf of themselves and others similarly situated, Plaintiffs,

USA LOGISTICS INC., dba USA MOVERS, a California Corporation; TOP MOVING SPECIALISTS INC. dba HERCULES MOVING SOLUTIONS, a Florida Corporation; RADO EXPRESS LOGISTICS, INC., an Illinois Corporation; GAL ROBI JEDDAE, an individual; TRAVIS ACKERMANN, an individual; RAFAEL OHANESYAN, an individual; and DOES 1 through 25, inclusive, Defendants.

Case No.: 23-cv-1695-WQH-KSC

Filed 09/24/2024

ORDER

Hon. William Q. Hayes United States District Court

*1 The matters before the Court are the Motion to Dismiss filed by Defendants Gal Robi Jeddae and USA Logistics Inc. (ECF No. 5) and the Motion to Dismiss filed by Defendants Top Moving Specialists Inc., Rado Express Logistics, Inc., and Rafael Ohanesyan (ECF No. 13).

I. BACKGROUND

On September 14, 2023, Plaintiffs Laszlo G. Peterfai and Sarah Jane Peterfai (“Plaintiffs”) initiated this action by filing a Complaint against USA Logistics Inc. (“USA Logistics”), Top Moving Specialists Inc. d/b/a Hercules Moving Solutions (“Hercules”), Rado Express Logistics, Inc. (“Rado”), Ackermann Express LLC (“Ackermann Express”), Monopoly Moving LLC (“Monopoly Moving”), Gal Robi Jeddae, Travis Ackermann, and Rafael Ohanesyan (collectively, “Defendants”) (ECF No. 1.)

On November 29, 2023, Defendants USA Logistics and Jeddae filed the Motion to Dismiss. (ECF No. 5.) On December 22, 2023, Plaintiffs filed a Response in opposition to the Motion to Dismiss. (ECF No. 11.) On December 28, 2023, Defendants USA Logistics and Jeddae filed a Reply. (ECF No. 12.)

On December 22, 2023, Defendants Travis Ackermann, Ackermann Express, and Monopoly Moving filed an Answer to the Complaint. (ECF No. 8.)

On January 11, 2024, Defendants Hercules, Rado, and Ohanesyan filed the Motion to Dismiss. (ECF No. 13.) On January 29, 2024, Plaintiffs filed a Response in opposition to the Motion to Dismiss. (ECF No. 14.) On February 15, 2024, Defendants Hercules, Rado, and Ohanesyan filed a Reply. (ECF No. 15.)

II. ALLEGATIONS IN THE COMPLAINT

“In the fall of 2022, Plaintiffs were moving from California to Texas. While in San Diego County, California, Plaintiff Sarah researched online moving companies and was directed to Defendant Hercules. On or about September 3, 2022, Defendant Hercules communicated via internet and telephone to Plaintiffs to provide a quote and then ‘Binding Moving Estimates’ for packing and transporting household goods and furnishings from Rancho Santa Fe, California to Houston, Texas.” (ECF No. 1 ¶ 18.)

In response to Plaintiff Sarah’s request to use a moving “pod,” Defendant Hercules represented that it “did not have any pods available until the first week of January 2023, but it had a ‘turn around’ truck, which would be less expensive, direct, and only Plaintiffs’ belongings would be on that truck during the entirety of the transport.” Id. ¶ 19. Defendant Hercules additionally represented that it “only hires moving companies with five-star ratings,” and “Plaintiffs’ items would not be transferred to another truck during transport.” Id.

“On or about September 3, 2022, after instructing Plaintiffs to estimate the measurement for the items that Plaintiffs sought to move, Defendant Hercules sent, via the internet to Plaintiffs’ computer in Rancho Santa Fe, California, a written ‘Binding Moving Estimate’ with Defendant Hercules’ logo at the top, for the interstate move of 652 cubic feet of Plaintiffs’ household goods and furnishings from California to Texas.” Id. ¶ 20. The Binding Moving Estimate “provided a Total Moving Estimate of $4,536.09 and at that time, Plaintiffs paid the requested ‘Customer Payment’ of $1,570.00 by credit card, which ultimately reflected on the credit card statement as a payment to Defendant Rado.” Id.

*2 “On or about September 15, 2022, based on Defendant Hercules’ instructions, Plaintiffs communicated again with Defendant Hercules to add a few more items and Defendant Hercules sent, via the internet to Plaintiffs’ computer in Rancho Santa Fe, California, a second written ‘Binding Moving Estimate’ with Defendant Hercules’ logo at the top, for the interstate move of 812 cubic feet of Plaintiffs’ household goods and furnishings from California to Texas.” Id. ¶ 21. The second Binding Moving Estimate provided a “Total Moving Estimate of $6,597.49 and Plaintiffs paid an additional $1,000.00 by credit card at that time to cover the requested ‘Customer Payment.’ ” Id.

“On September 16, 2022, a moving truck arrived at Plaintiffs’ home in Rancho Santa Fe, California with 7 men, whom Plaintiffs later learned to be associated with Defendant USA Logistics.” Id. ¶ 22. “When the moving truck arrived, Plaintiffs were told that the items they wanted moved needed to be taken out of Plaintiffs’ home and garage and placed on the street and driveway and then placed on the truck. Some of the men proceeded to pack some of the items and wrap some of the furniture, while the other men took all of the items that Plaintiffs wanted moved out of Plaintiffs’ home and garage, placed them in the street and driveway and then started placing them in the moving truck, which appeared to be a standard 26 foot box truck.” Id.

“After Defendant USA Logistics’ men started placing Plaintiffs’ items on the truck from the driveway and street, Plaintiffs were told by one of the men, David of USA Logistics, that Plaintiffs’ items would ‘fill the entire truck.’ David of USA Logistics then said to Plaintiffs that the new cost for the move was $23,000.00, which was more than three times the amount contained in the [second Binding Moving Estimate].” Id. ¶ 23. Plaintiff Lasz[lo] told the men to stop and that Plaintiffs would not be moving forward with the move. “David of USA Logistics then threatened Plaintiffs by saying that if Plaintiffs stopped the move, in addition to losing Plaintiffs’ deposit of $2,570.00, Plaintiffs would have to pay $5,000.00 more to unload and place Plaintiffs’ belongings in the street and driveway; the men would not return the belongings to the house or garage.” Id. ¶ 25. “Plaintiffs felt like they had no choice so when David said that Defendant USA Logistics would complete the move for $17,500.00, Plaintiffs paid the additional deposit demanded of $9,700.00 (at this time the total amount of deposits paid were $12,270). Despite Plaintiffs’ protests, once the men from USA Logistics placed Plaintiffs’ remaining items in the truck, they immediately drove away with Plaintiffs’ belongings.” Id. ¶ 26.

“On or about Saturday, September 24, 2022 at around 12:30 pm and without any advance notice, a person who identified himself as being from another company named Monopoly Moving, and who was later identified as Travis Ackermann of Ackermann Express LLC and Monopoly Moving LLC, telephoned Plaintiff Sarah, who was now at Plaintiffs’ home in Houston, Texas, and told her that he was going to deliver Plaintiffs’ items to Plaintiffs’ home in Houston, Texas at 3:00 pm that same day.” Id. ¶ 27. “Defendant Ackermann also demanded that Plaintiffs pay a purported remaining balance of $5,225.00 in cash or money orders upon delivery. Defendant Ackermann asserted that he would only take cash or United States Postal Service money orders and no other form of payment.” Id. “Plaintiff Sarah protested the cash/money order payment and disputed that Plaintiffs owed the money demanded by Defendants Ackermann, Ackermann LLC and Monopoly. Defendant Ackermann refused to deliver Plaintiffs’ items and threatened to dump Plaintiffs’ belongings in the desert unless Plaintiffs paid him the full amount demanded in cash or United States Postal Service money orders.” Id. ¶ 28. “Plaintiffs requested that the delivery be delayed until at least Monday, September 26, 2022 so that cash or money orders could be obtained to pay the ransom payment as Defendant Ackermann had demanded. Defendant Ackermann never responded.” Id. “On Monday, September 26, 2022, Plaintiff Sarah rushed as quickly as she could in the morning to get cash from her bank and then to the United States Post Office to get money orders to pay the $5,225.00 ransom demand. Then Plaintiff Sarah went back to Plaintiffs’ home and waited.” Id. ¶ 31.

*3 “On September 26, 2022, shortly after Plaintiff Sarah returned home from the post office, Defendants Ackermann, Ackermann LLC and Monopoly showed up in a truck that was not the same truck that picked up Plaintiffs’ belongings, shoved a bunch of paperwork in front of Plaintiff Sarah to sign, took Plaintiffs’ money orders, dumped boxes of Plaintiffs’ items in the garage and on the driveway of Plaintiffs’ home, and refused to give Plaintiffs copies of the paperwork, including but not limited to the Bill of Lading[.]” Id. ¶ 32.

“Upon unpacking and inspecting their belongings, Plaintiffs found that a vast majority of Plaintiffs’ items were either damaged or missing. Since Plaintiffs had been told by Defendant Hercules that Plaintiffs had insurance that covered their items, Plaintiffs submitted an insurance claim only to find out that USA Logistics was somehow involved in the insurance process, and for a claim of over $32,164.00 in damaged or missing items, Plaintiffs were offered payment of $375.60, which would require Plaintiffs to sign a Release Form. Plaintiffs did not accept and refused to sign the Release Form.” Id. ¶ 33.

“None of the Defendants possess or possessed the required certifications and/or licenses from the Department of Consumer Affairs, Bureau Of Household Goods And Services in California.” Id. ¶ 34. “Defendants’ custom and practice to similarly extort interstate customers like Plaintiffs out of cash for their property is shown in the many complaints of other consumers[.]” Id. ¶ 35.

“Defendants operated as if they were a single business entity by operating and working through affiliated companies named USA Logistics, Hercules, Rado, Monopoly, and other entities presently unknown.” Id. ¶ 45. “Individual Defendants owned, operated, and/or worked as employees, members, and associates of the affiliated companies.” Id. ¶ 46. “[E]ach of the Defendants amongst each other agreed to commit, and did so commit, at least two acts of racketeering activity.” Id. ¶ 52.

Plaintiffs bring the following causes of action against Defendants: (1) violations of the Racketeer Influenced and Corrupt Organizations Act (“RICO”); (2) violations of the Carmack Amendment; (3) violations of the California Control of Profits of Organized Crime Act (“CA RICO”); (4) Conversion/Civil Theft; (5) Fraudulent Inducement; (6) Rescission of Contract; (7) Breach of Fiduciary Duty; (8) Constructive Fraud; (9) Negligence; and (10) violations of Unfair Competition Laws. Plaintiffs seeks the following relief: preliminary and permanent injunctions on behalf of themselves and others similarly situated, enjoining and restraining Defendants from continuing the wrongful, unlawful, unfair and fraudulent business practices as set forth above; disgorgement; statutory and treble damages and penalties; compensatory damages; special damages; general damages; punitive damages; interest and prejudgment interest; reasonable attorney’s fees’ and costs; and such other relief as the Court deems just and proper.

III. LEGAL STANDARD

Rule 12(b)(6) of the Federal Rules of Civil Procedure permits dismissal for “failure to state a claim upon which relief can be granted.” Fed. R. Civ. P. 12(b)(6). In order to state a claim for relief, a pleading “must contain … a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2). Dismissal under Rule 12(b)(6) “is ‘proper only where there is no cognizable legal theory or an absence of sufficient facts alleged to support a cognizable legal theory.’ ” Shroyer v. New Cingular Wireless Servs., Inc., 622 F.3d 1035, 1041 (9th Cir. 2010) (quoting Navarro v. Block, 250 F.3d 729, 732 (9th Cir. 2001)).

*4 “To survive a motion to dismiss, a complaint must contain sufficient factual matter, accepted as true, to ‘state a claim 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, 570 (2007)). “A claim has facial plausibility 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. However, “a plaintiff’s obligation to provide the ‘grounds’ of his ‘entitle[ment] to relief’ requires more than labels and conclusions, and a formulaic recitation of the elements of a cause of action will not do.” Twombly, 550 U.S. at 555 (quoting Fed. R. Civ. P. 8(a)). While a pleading “does not require ‘detailed factual allegations,’ ” Rule 8 nevertheless “demands more than an unadorned, the defendant-unlawfully-harmed-me accusation.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 555). A court is not “required to accept as true allegations that are merely conclusory, unwarranted deductions of fact, or unreasonable inferences.” Sprewell v. Golden State Warriors, 266 F.3d 979, 988 (9th Cir. 2001). “In sum, for a complaint to survive a motion to dismiss, the non-conclusory factual content, and reasonable inferences from that content, must be plausibly suggestive of a claim entitling the plaintiff to relief.” Moss v. U.S. Secret Serv., 572 F.3d 962, 969 (9th Cir. 2009).

IV. DISCUSSION

Defendants USA Logistics, Jeddae, Hercules, Rado, and Ohanesyan move to dismiss the claims against them on the following grounds: (1) the Bill of Lading limits their liability to $.60 per pound for damaged, lost, or destroyed property; (2) the Carmack Amendment preempts Plaintiffs’ California statutory and common law claims; (3) Plaintiffs fail to adequately plead claims for civil RICO (4) Plaintiffs fail to adequately plead claims of conversion and constructive fraud against Defendant Rado; (5) Plaintiffs fail to adequately allege a Carmack Amendment claim against Defendant Hercules; and (6) Plaintiffs fail to plead personal liability against Defendants Jeddae and Ohanesyan.

A. Bill of Lading

Defendants first contend that the Bill of Lading limits their liability to $.60 per pound for Plaintiffs’ damaged, lost, or destroyed property, and that Plaintiffs agreed to this limitation. (ECF No. 5 at 5; ECF No. 13 at 6.) However, the Complaint alleges that all contractual agreements have been rescinded. (ECF No. 1 ¶ 102.) Plaintiffs’ allegations must be accepted as true for purposes of a 12(b)(6) motion. Additionally, Plaintiffs do not attach the Bill of Lading to their Complaint, and neither party has requested the Court consider the terms of the Bill of Lading pursuant to the incorporation-by-reference doctrine. See, e.g., Knievel v. ESPN, 393 F.3d 1068, 1076 (9th Cir. 2005).

B. Preemption of State Law Claims

“A fundamental principle of the Constitution is that Congress has the power to preempt state law.” Crosby v. Nat’l Foreign Trade Council, 530 U.S. 363, 372 (2000). A federal statute completely preempts a state action when “the scope of a statute indicates that Congress intended federal law to occupy a field exclusively.” Freightliner Corp. v. Myrick, 514 U.S. 280, 287 (1995). The Carmack Amendment, enacted in 1906, was designed to establish a “national scheme of carrier liability for goods damaged or lost during interstate shipment.” Campbell v. Allied Van Lines Inc., 410 F.3d 618, 620 (9th Cir. 2005). The Carmack Amendment “provides the exclusive cause of action” against carriers 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, LLC, 543 F.3d 581, 584 (9th Cir. 2008); Hall v. N. Am. Van Lines, Inc., 476 F.3d 683, 688 (9th Cir. 2007) (holding that the Carmack Amendment is the “exclusive cause of action” against a carrier of interstate goods, and this extends to “all manner of harms” arising from loss or damage to the shipment); N.Y., New Haven & Hartford RR Co. v. Nothnagle, 346 U.S. 128, 131 (1953) (“Congress superseded diverse state laws with a nationally uniform policy governing interstate carriers’ liability for property loss.”).

*5 Plaintiffs concede that the Carmack Amendment preempts their conversion and negligence claims against USA Logistics and Hercules, who are alleged to be “carriers” within the meaning of the Carmack Amendment. However, Plaintiffs contend that the Carmack Amendment does not preempt claims based on conduct independent from the loss or damage of Plaintiffs’ belongings, such as Plaintiffs’ RICO claims, which arise out of allegations of fraud and extortion. In Hall, the Ninth Circuit held that “the Carmack Amendment completely preempts a contract claim alleging the late delivery of goods, even without loss or property damage.” Hall, 476 F.3d at 688. The Ninth Circuit reasoned that “making finer distinctions between the types of contract damages would ‘defeat the purpose of the statute, which was to create uniformity out of disparity.’ ” Id. Since Plaintiffs’ allegations of fraud and extortion arise out of Defendants’ alleged refusal to deliver Plaintiffs’ items, such claims against Defendants USA Logistics and Hercules are preempted by the Carmack Amendment. See Titans Trading Corp. v. JTS Express, No. CV 09-00714 MMM (RCx), 2009 WL 537515, at *3 (C.D. Cal. Mar. 3, 2009) (concluding that claims based on similar conduct were preempted by the Carmack Amendment because “courts have consistently held that the amendment preempts all state claims related to a shipping agreement”); White v. Mayflower Transit, LLC, 481 F. Supp. 2d 1105, 1109 n.3 (C.D. Cal. 2007) (holding that claims “for contractual fraud, insurance coverage, general negligence, and property damage relate[d] to the loss of, or damage to, plaintiff’s personal belongings, [were] … preempted.”).

To the extent Defendants contend the Carmack Amendment preempts state law claims against Rado, Jeddae, and Ohanesyan, these Defendants are not alleged to be “carriers” within the meaning of the Carmack Amendment. Based upon the allegations of the Complaint, the Carmack Amendment does not apply to these Defendants, and therefore, the Court does not find, at this stage in the proceedings, that the Carmack Amendment preempts the state law claims against them. See Chubb Grp. of Ins. Cos. v. H.A. Transp. Sys., Inc., 243 F. Supp. 2d 1064, 1068–69 (C.D. Cal. 2002) (“[T]he Carmack Amendment does not apply to brokers. … Consequently, most courts hold that brokers may be held liable under state tort or contract law in connection with shipments.”); FNS, Inc. v. Bowerman Trucking, Inc., No. 09–CV–0866–IEG (PCL), 2010 WL 532421, at *4 (S.D. Cal. Feb. 9, 2010) (“The Court agrees that the Carmack Amendment does not preempt state law claims against brokers[.]”).

The Motions to Dismiss the state law claims, as preempted by the Carmack Amendment are granted as to USA Logistics and Hercules and otherwise denied.

C. RICO Claims

The RICO Act provides for civil and criminal liability. Odom v. Microsoft Corp., 486 F.3d 541, 545 (9th Cir. 2007) (citing Pub. L. No. 91-452, § 901, 84 Stat. 922 (1970)) (codified at 18 U.S.C. § 1964(c)). The elements of a civil RICO claim are “(1) conduct (2) of an enterprise (3) through a pattern (4) of racketeering activity (known as ‘predicate acts’) [and] (5) causing injury to plaintiff’s business or property.” United Bhd. of Carpenters & Joiners of Am. v. Bldg. & Constr. Trades Dep’t, AFL-CIO, 770 F.3d 834, 837 (9th Cir. 2014) (quoting Living Designs, Inc. v. E.I. Dupont de Nemours & Co., 431 F.3d 353, 361 (9th Cir. 2005)). “ ‘Racketeering activity’ includes, inter alia, ‘any act which is indictable’ under the Hobbs Act, 18 U.S.C. § 1951, or ‘any act or threat involving … extortion, … which is chargeable under State law.’ ” Id. (quoting 18 U.S.C. § 1961(1)(A), (B)) (cleaned up). “A ‘pattern of racketeering activity’ requires at least two predicate acts of racketeering activity, as defined in 18 U.S.C. § 1961(1) within a period of ten years.” Canyon County. v. Syngenta Seeds, Inc., 519 F.3d 969, 972 (9th Cir. 2008) (citing 18 U.S.C. § 1961(5)). The Ninth Circuit has observed that “[t]he identification of a pattern of racketeering has proven a challenging task for courts.” Sever v. Ala. Pulp Corp., 978 F.2d 1529, 1535 (9th Cir. 1992) (quotation omitted). The Supreme Court in H.J. Inc. v. Nw. Bell Telephone Co., 492 U.S. 229 (1989), “considered the term in an effort to provide some guidance to lower courts struggling with it” and “held that to show a pattern of racketeering activity, a RICO plaintiff must ‘show that the racketeering predicates are related, and that they amount to or pose a threat of continued criminal activity.’ ” Sever, 978 F.2d at 1535 (quoting H.J. Inc., 492 U.S. at 239).

*6 Federal Rule of Civil Procedure 9(b)’s “requirement that ‘in all averments of fraud or mistake, the circumstances constituting fraud or mistake shall be stated with particularity’ applies to civil RICO fraud claims.” Edwards v. Marin Park, Inc., 356 F.3d 1058, 1065–66 (9th Cir. 2004) (quoting Alan Neuman Productions, Inc. v Albright, 862 F.2d 1388, 1392 (9th Cir. 1989)). Rule 9(b) “requires a pleader of fraud to detail with particularity the time, place, and manner of each act of fraud, plus the role of each defendant in each scheme.” Lancaster Cmty. Hosp. v. Antelope Valley Hosp. Dist., 940 F.2d 397, 405 (9th Cir. 1991). While state of mind may be generally alleged, “the factual circumstances of the fraud must be alleged with particularity.” Odom, 486 F.3d at 554.

Plaintiffs assert the Complaint “provides facts that show or are the misrepresentations, how misrepresentations were made, dates, places, names of those involved, and by what means the representations were tendered.” (ECF No. 11 at 16.) However, Plaintiffs frequently utilize group terms such as “Defendants,” “Individual Defendants” and “Moving Enterprise,” suggesting that all Defendants were involved in nearly all actions. (ECF No. 1 ¶ 38–56.) Under Rule 9(b)’s heightened pleading standard, Plaintiffs cannot “lump together the defendants without identifying the particular acts or omissions that each defendant committed.” Mostowfi v. i2Telecom Int’l., Inc., 269 Fed. Appx. 621, 624 (9th Cir. 2008); see, e.g., Thomas Land & Development, LLC v. Vratsinas Construction Company, No. 18-CV-1896-AJB-NLS, 2019 WL 3842995, at *7 (explaining that “Plaintiff’s frequent use of ‘ENTITY DEFENDANTS’ suggests that every named defendant was involved in nearly every alleged scheme and all collusive practices. This term prevents the Court from being able to distinguish which defendant was engaged in what wrongful conduct, more so if every named defendant was involved, it prevents the Court from understanding how they played a role.”).

Furthermore, Plaintiffs allege “each of the Defendants” committed “at least two acts of racketeering activity in the conduct of the affairs of the Moving Enterprise.” (ECF No. 1 ¶ 52.) However, Plaintiffs fail to identify the “who, what, when, where, and how” of the alleged acts, as required under Rule 9(b). See Vess v. Ciba-Geirgy Corp. USA, 317 F.3d 1097, 1106 (9th Cir. 2003) (“Averments of fraud must be accompanied by ‘the who, what, when, where, and how’ of the misconduct charged.”) (quoting Cooper v. Pickett, 137 F.3d 616, 627 (9th Cir. 1997)). Although some specific factual allegations underlying the RICO claims against non-moving Defendants Travis Ackermann, Ackermann Express, and Monopoly Moving can be identified in the Complaint (see, e.g., ECF No. 1 ¶¶ 27–32,) the RICO claim fails to detail which of the moving Defendants are alleged to have committed which predicate acts, leaving the moving Defendants unable to determine whether or to what extent their alleged conduct was the subject of the extortion predicate acts.

Because Plaintiffs’ civil RICO claims do not identify the “who, what, when, where, and how” of the alleged fraud, and impermissibly lump Defendants’ actions together, failing to identify their individual acts with specificity, the Motions to Dismiss the civil RICO claims against the moving Defendants are granted.

D. Constructive Fraud and Conversion Claims against Rado

Defendant Rado moves to dismiss the constructive fraud and conversion claims.¹ First, Rado contends Plaintiffs fail to allege constructive fraud against it because Rado does not owe fiduciary duties to Plaintiffs. While Plaintiffs allege Rado is a “broker” under the Carmack Amendment, Rado contends that the “transportation laws do not have any ‘fiduciary’ designations to brokers of household goods.” (ECF No. 13 at 16.)

*7 “Constructive fraud is a unique species of fraud applicable only to a fiduciary or confidential relationship.” Salahutdin v. Valley of Cal., Inc., 24 Cal. App. 4th 555, 562 (Ct. App. 1994) (citation omitted). To succeed in a constructive fraud claim, a plaintiff must show: (1) the existence of a fiduciary or confidential relationship; (2) nondisclosure; (3) intent to deceive; and (4) reliance and resulting injury. Younan v. Equifax Inc., 111 Cal. App. 3d 498, 516 n.14 (Ct. App. 1980). “Like fraud claims, constructive fraud claims [under California law] are subject to the particularity requirements of Rule 9(b).” See Edumoz, LLC v. Republic of Mozambique, No. CV 13-02309-MMM, 2014 WL 12802921, at *30 (C.D. Cal. July 21, 2014).

Under the Carmack Amendment, a “broker” is defined as “a person, other than a motor carrier or an employee or agent of a motor carrier, that as a principal or agent sells, offers for sale, negotiates for, or holds itself out by solicitation, advertisement, or otherwise as selling, providing, or arranging for, transportation by motor carrier for compensation.” 49 U.S.C. § 13102(2). Plaintiffs contend that Rado, as a broker, owed fiduciary duties to Plaintiffs because a broker acts as an agent of Plaintiffs. (ECF No. 14 at 9 (“[A] fiduciary relationship is a recognized legal relationship such as guardian and ward, trustee and beneficiary, principal and agent, or attorney and client.”).)

However, Plaintiffs cite no authority for the assertion that a broker acts as an agent of the party who owns the shipped goods, or otherwise owes the owner a fiduciary duty. See Oak Harbor Freight Lines v. Sears Roebuck & Co., 420 F. Supp. 2d 1138, 1147 (W.D. Wash. 2006) (“NLC has failed to provide any case law supporting its argument that the definitions of ‘brokerage services’ and ‘non-brokerage services,’ see 49 C.F.R. §§ 371.1(c)–(d), automatically make all brokers agents because they act ‘on behalf of’ someone else. NLC’s argument overlooks the definition of broker in 49 U.S.C. § 13102(2), which explicitly states that a broker is a person who acts ‘as a principal or agent’ in arranging for transportation by motor carrier for compensation.”). Moreover, where fraud is alleged against a corporation, a plaintiff must also “allege the names of the employees or agents who purportedly made the fraudulent representations or omissions, or at a minimum identify them by their titles and/or job responsibilities.” UMG Recordings, Inc. v. Glob. Eagle Entm’t, Inc., 117 F. Supp. 3d 1092, 1108 (C.D. Cal. 2015). Plaintiffs fail to allege any acts by employees or agents of Rado. As such, the Complaint fails to adequately allege a constructive fraud claim against Rado.

Rado also contends Plaintiffs fail to adequately allege conversion against Rado because “Plaintiffs failed to demonstrate any wrongful dominion of Plaintiffs’ property, or that [Rado] ha[s] been unjustly enriched.” (ECF No. 13 at 13.) “The elements of a conversion cause of action are (1) plaintiffs’ ownership or right to possession of the property at the time of the conversion; (2) defendants’ conversion by a wrongful act or disposition of plaintiffs’ property rights; and (3) damages.” Graham-Sult v. Clainos, 756 F.3d 724, 737 (9th Cir. 2014) (alteration omitted).

Here, the Complaint alleges that Rado “substantially interfered with Plaintiffs’ property by knowingly and/or intentionally preventing Plaintiffs from having access to their personal property and/or destroying Plaintiffs’ personal property and/or refusing to return certain items of Plaintiffs’ personal property after Plaintiffs demanded their return.” (ECF No. 1 ¶ 82.) The Complaint alleges that this conduct “damaged Plaintiffs by interfering with and preventing access to their property and by way of payment of fees for an interstate move Defendants conducted illegally.” Id. These allegations are sufficient to state a claim for conversion against Rado.

*8 The Motion to Dismiss the constructive fraud claim against Rado is granted, and the Motion to Dismiss the conversion claim against Rado is denied.

E. Carmack Amendment Claim against Hercules

Defendant Hercules moves to dismiss the Carmack Amendment claim. Defendant contends that the Complaint alleges Hercules is a broker, rendering the Carmack Amendment inapplicable to Hercules. The Carmack Amendment “subjects common carriers and freight forwarders transporting cargo in interstate commerce to absolute liability for actual loss or injury to property.” Ins. Co. of N. Am. v. NNR Aircargo Serv. (USA), Inc., 201 F.3d 1111, 1115 (9th Cir.2000) (emphasis added) (citing 49 U.S.C. § 14706(a)). The Carmack Amendment does not impose liability on brokers. See Chubb, 243 F. Supp. 2d at 1068–69. However, the Complaint alleges that Hercules “operates a common carrier business and/or as a purported broker.” (ECF No. 1 ¶ 5.) Plaintiffs’ allegations must be accepted as true for purposes of a 12(b)(6) motion. At this stage in the proceedings, Plaintiffs’ contention that Hercules operates a common carrier business is sufficient to plausibly allege the Carmack Amendment is applicable to Hercules. Accordingly, the Motion to Dismiss the Carmack Amendment claim against Hercules is denied.

F. Remaining Claims Against Jeddae and Ohanesyan

Defendants move to dismiss the conversion, rescission of contract, negligence, and unfair competition claims against Defendants Jeddae and Ohanesyan for lack of allegations supporting individual liability of these defendants. The Complaint fails to allege any facts specific to the conduct of Jeddae and Ohanesyan. The Motions to Dismiss the remaining claims against Defendants Jeddae and Ohanesyan are granted.

V. CONCLUSION

IT IS HEREBY ORDERED the Motions to Dismiss (ECF Nos. 5, 13) are granted in part and denied in part, as discussed above. All claims dismissed in this Order are dismissed without prejudice and with leave to amend.

IT IS FURTHER ORDERED that no later than twenty-one days from the date this Order is filed, Plaintiffs may file a first amended complaint that addresses the deficiencies identified in this Order. If no first amended complaint is filed, Defendants shall file an answer to the Complaint no later than thirty days from the date this Order is filed.

All Citations

Slip Copy, 2024 WL 4279506

Footnotes
¹	As stated above, based upon the allegations of the Complaint, the Carmack Amendment preempts state law claims against USA Logistics and Hercules but does not preempt state law claims against Rado.

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