Bits & Pieces

Sabillon v. Max Specialty Ins. Co.

Court of Appeal of Louisiana,

Fourth Circuit.



MAX SPECIALTY INSURANCE COMPANY d/b/a Alterra Insurance Company, Dupuy Storage and Forwarding Corporation, and Dupuy Storage and Forwarding, L.L.C.


No. 2013–CA–0513.

March 12, 2014.


Appeal from Civil District Court, Orleans Parish, No.2011–01102, Division “F”, Honorable Christopher J. Bruno, Judge.

Jeffrey A. Mitchell, Monica C. Sanchez, Hugo L. Chanez, Mitchell Sanchez, LLC, Metairie, LA, Thomas M. Flanagan, Andy Dupre, Anders F. Holmgren, Flanagan Partners, LLP, New Orleans, LA, for Plaintiff/Appellee.


Louis C. LaCour, Jr., Adams and Reese, LLP, New Orleans, LA, for Defendant/Appellant.





*1 Defendants, Dupuy Storage and Forwarding Corporation and Dupuy Storage and Forwarding L.L.C., appeal two trial court judgments: (1) the October 29, 2012 judgment in favor of plaintiff, Danilo Sabillon, in the amount of $4,661,333.00, plus judicial interest and costs to be taxed by the trial court from the date of judicial demand until paid, and (2) the January 2, 2013 judgment denying defendants’ motion for new trial, motion for judgment notwithstanding the verdict and, alternatively, motion for remittitur of the damages award.FN1 For reasons that follow, we affirm.


FN1. Defendant Max Specialty Insurance Company was also cast in judgment with Dupuy Storage and Forwarding Corporation and Dupuy Storage and Forwarding L.L.C., and joined in the motion for appeal. However, following the order granting a suspensive appeal to all three defendants, Max Specialty reached a settlement with plaintiff, and plaintiff entered into a joint motion with Max Specialty to dismiss Max Specialty from the litigation with prejudice. The order dismissing Max Specialty Insurance Company with prejudice was signed on January 31, 2013.


On February 3, 2010, the plaintiff, an independent commercial truck driver who was in the business of transporting loads of cargo, arrived with a delivery of cargo at a warehouse owned by Dupuy Storage and Forwarding L.L.C. (hereinafter referred to as “Dupuy.”) FN2 An employee of Dupuy used a forklift to unload the cargo transported by plaintiff. During the unloading process, the load fell off the forklift and struck a piece of lumber, which became airborne and struck plaintiff in the head, causing severe injuries. Plaintiff was 46 years old at the time of the accident. Plaintiff filed suit against Dupuy and its insurer, Max Specialty Insurance Company, alleging that plaintiff’s injuries were caused solely by the negligence of Dupuy and its employee(s).


FN2. Dupuy Storage and Forwarding L.L.C. is the successor entity to Dupuy Storage and Forwarding Corporation. Both entities were named as defendants in this lawsuit.


Following trial, a jury found Dupuy solely at fault for plaintiff’s injuries, and awarded plaintiff the following damages, totaling $4,661,333.00:


(1) Physical injury, pain and suffering (past and future)—$1,303,333.00


(2) Mental anguish, pain and suffering (past and future)—$996,667.00


(3) Permanent disability, if any—$670,833.00


(4) Loss of enjoyment of life (past and future)—$862,500.00


(5) Medical expenses (past and future)—$128,000.00


(6) Past lost wages and future loss of earnings/loss of earning capacity—$700,000.00


The trial court adopted the jury verdict, and rendered judgment in favor of plaintiff and against Dupuy and Max Specialty Insurance Company, in the amount of $4,661,333.00, plus judicial interest and costs to be taxed by the court from the date of judicial demand until paid. Dupuy and Max Specialty Insurance Company subsequently filed motions for new trial and for judgment notwithstanding the verdict to reduce the damages award, and alternatively, for remittitur of the damages award. The trial court denied those motions, and this appeal followed.


On appeal, Dupuy raises two assignments of error:


(1)The jury manifestly erred in its award of $700,000.00 in past lost wages and future loss of earnings/loss of earning capacity; and


(2)The jury manifestly erred in its award of $3,833,333.00 in general damages.


Dupuy did not appeal the finding that it was 100% at fault for this accident. With regard to the award of $700,000.00 for past lost wages and future loss of earnings/loss of earning capacity, Dupuy argues that the plaintiff is not now, nor is he likely to be in the future, permanently and totally disabled. According to Dupuy, the evidence at trial established that plaintiff returned to work driving a truck a few weeks after the accident, and is able to work in gainful employment at wages equal to or above those he was earning at the time of the accident. Plaintiff responds that the jury did not manifestly err in awarding $700,000.00 in economic damages in light of the medical evidence of plaintiff’s ongoing decline and the testimony of experts whom Dupuy stipulated were qualified.


*2 Elizabeth Bauer, who was accepted as an expert in vocational rehabilitation, testified on behalf of plaintiff. She testified that she interviewed plaintiff and did a comprehensive review of the medical records relating to plaintiff, including the reports of two neuropsychologists. After reviewing this information and evaluating plaintiff, Ms. Bauer concluded that plaintiff’s skills are specific to driving 18–wheel trucks, and are not transferrable to other types of work. Given her additional opinion that plaintiff has no transferrable skills, Ms. Bauer’s opinion is that plaintiff is unemployable. Ms. Bauer noted that plaintiff’s 2011 income of $56,123.00 closely coincides with the annual earning rate of $57,100 .00 that her research showed could be earned by Louisiana truck drivers. According to Ms. Bauer, plaintiff would have continued to earn that amount but for his injuries sustained in the accident.


Dr. Shael Wolfson, an expert forensic economist who testified on behalf of plaintiff, stated that plaintiff sustained $4,690.00 in lost wages. Dr. Wolfson further testified that assuming the earnings figures stated by Elizabeth Bauer, plaintiff’s loss of earning capacity would be $520,967.00 if he worked to the age of 60, or $1,012,028.00 if calculated from the time of trial until the age of 67 when plaintiff would be eligible to receive Social Security benefits.


Dr. Larry Stokes, who was accepted as an expert in the field of vocational rehabilitation, testified on behalf of Dupuy. He stated that he interviewed plaintiff, and reviewed accident and medical records and depositions relating to plaintiff. His opinion is that plaintiff has some transferrable skills, most of which involve driving. Dr. Stokes testified that plaintiff could drive a pickup truck, car or van, and perform sedentary to light duty work, such as being an escort driver, a delivery driver or courier. He also stated that plaintiff could probably perform some jobs that do not involve driving, such as assembly work and janitorial work. Dr. Stokes’ opinion is that plaintiff did not sustain a loss of earning capacity as a result of the accident, and can continue to earn wages similar to those earned prior to the accident.


Kenneth Boudreaux, the expert economist testifying on behalf of Dupuy, testified that given Dr. Stokes’ opinion regarding plaintiff’s employability, plaintiff does not have any loss of earning capacity. However, when asked to use Ms. Bauer’s calculation that plaintiff could earn $57,100.00 per year, Mr. Boudreaux testified that if plaintiff cannot work at all, his present value future lost earnings would total $672,600.00 if plaintiff worked until the age of 60.


Dupuy also points to the testimony of plaintiff’s neurologist, Dr. Morteza Shamsnia, who stated that plaintiff can no longer drive an 18–wheel truck, but could drive a car or a pickup truck. But Dr. Shamsnia also said that he is not a vocational rehabilitation expert, and would not make any assessment as to whether or not plaintiff’s skills as a driver of an 18–wheel truck were transferrable to other types of employment.


*3 “The jury’s determination of the amount, if any, of an award of damages, including lost earning capacity, is a finding of fact.” Ryan v. Zurich American Ins. Co., 07–2312, p. 7 (La.7/1/08), 988 So.2d 214, 219. “Credibility determinations, including evaluating expert witness testimony, are for the trier of fact.” Jones v. Harris, 04–0965, p. 15 (La.App. 4 Cir. 2/2/05), 896 So .2d 237, 246 (citing Sportsman Store of Lake Charles, Inc. v. Sonitrol Security Systems of Calcasieu, Inc., 99–0201, p. 6 (La.10/19/99), 748 So.2d 417, 421). “Such credibility determinations are factual findings governed by the well-settled manifest error standard of review.” Id.


Although the jury was presented with conflicting testimony on the issue of plaintiff’s loss of future earning capacity, there was a reasonable basis for the jury’s award of $700,000.00 for past lost wages and future loss of earnings/loss of earning capacity. This award was not manifestly erroneous.


Dupuy next argues that the jury erred in its award of $3,833,333.00 in general damages. Plaintiff was awarded this amount for damages including physical and mental pain and suffering (past and future), permanent disability and loss of enjoyment of life (past and future).


In Williams v. Stewart, 10–0457 (La.App. 4 Cir. 9/22/10), 46 So.3d 266, this Court summarized the law regarding an appellate court’s review of an award of general damages as follows:


A trial court has great discretion when assessing damages. Youn v. Maritime Overseas Corp., 623 So.2d 1257 (La.1993). In reviewing a general damage award, the first inquiry is “whether the particular effects of the particular injuries to the particular plaintiff are such that there has been an abuse of the ‘much discretion’ vested in the judge or jury.” Joseph v. City of New Orleans, 02–1996 (La.App. 4 Cir. 3/5/03), 842 So.2d 420 (quoting 1 Frank L. Maraist and Harry T. Lemmon, Louisiana Civil Law Treatise: Civil Procedure § 14.14 (1999)). The standard of review for abuse of discretion in awarding general damages is “difficult to express and is necessarily non-specific.” Cone v. National Emergency Services, Inc., 99–0934, p. 8 (La.10/29/99), 747 So.2d 1085, 1089. Only when the award, in either direction, is beyond that which a reasonable trier of fact could assess for effects of a particular injury to a particular plaintiff under particular circumstances, should an appellate court increase or reduce award. Coco v. Winston Industries, Inc., 341 So.2d 332 (La.1977). In the Youn case, which is the seminal case on this standard, the Louisiana Supreme Court articulated the standard as follows: “the discretion vested in the trier of fact is ‘great,’ and even vast, so that an appellate court should rarely disturb an award of general damages.” Youn, 623 So.2d at 1261.


Id., pp. 22–23, 46 So.3d at 280.


The record reflects that plaintiff worked as an independent contractor truck driver. The owner of a trucking company for whom plaintiff frequently worked described plaintiff as very dependable before the accident. Following the accident, plaintiff continued to drive 18–wheelers for this same trucking company for a brief period of time, but the owner of the company stated that plaintiff got lost on several trips, failed to properly secure his loads, and failed to complete his logbooks, things that plaintiff had never done prior to the accident. Based on these incidents, the owner of the trucking company decided to no longer employ plaintiff.


*4 Plaintiff testified that since the accident, he has had a buzzing sound in his head that he hears at all times when he is awake. His neck feels like it is broken, which causes him to have difficulty sleeping. He has pain from the base of his neck all the way down the entire length of his back, and this pain is getting worse over time. He developed vision problems since the accident. He has suffered from memory loss. His injuries have adversely affected his relationships with his partner and children. Plaintiff’s partner corroborated plaintiff’s testimony.


Dr. William Alden, an expert in internal medicine, occupational medicine, sports medicine, physical medicine and rehabilitation, testified that he began treating plaintiff shortly after the accident. On plaintiff’s first visit, less than a week after the accident, Dr. Alden’s clinical impression was that plaintiff suffered a head injury with loss of consciousness, post traumatic headaches, cervical, thoracic and lumbar pain, facial laceration and left-sided shoulder pain. An MRI performed on plaintiff’s lumbar and cervical spine revealed a bulging disc at C5–C6 and a bulging disc at C4–C5 with a tear in the bulge. The MRI also revealed some facet arthrosis, which Dr. Alden described as inflammation in the small joints next to the herniation. The MRI of the lumbar spine revealed a bulging at L3–L4 and a herniation at L4–L5. Dr. Alden related all of these conditions to the February 3, 2010 accident. Based on the results of the MRI, Dr. Alden advised plaintiff to consult an orthopedist or a neurologist because of Dr. Alden’s opinion that plaintiff was a surgical candidate.


Dr. Lawrence Glorioso, an expert in neuroradiology, diagnostic radiology, radiologic pathology, and vascular and interventional radiology, testified that he interpreted cervical, lumbar and brain MRIs performed on plaintiff. He stated that because the plaintiff still had significant neck pain at trial—over two years after the accident—the pain will not resolve without surgery. Dr. Glorioso also stated that plaintiff is a surgical candidate for the herniation at L4–L5, and such surgery could alleviate his pain in that area. Dr. Glorioso compared a CT scan taken of plaintiff’s brain on the date of the accident with an MRI taken of the brain almost two years later in December 2011. That MRI was the first one taken of the plaintiff’s brain after the accident, and was ordered by Dr. Frank Johnston, whose testimony is summarized below. Dr. Glorioso testified that while the CT scan was essentially normal with regard to the brain (the scan did show that plaintiff suffered an acute nasal fracture,) the MRI of the brain taken almost two years later showed a significant level of brain atrophy and scarring consistent with what is known as coup contrecoup injury. He testified that this condition is associated with a closed-head injury, and that brain atrophy is a gradual process. A second MRI of plaintiff’s brain that was taken four months after the first MRI showed that plaintiff’s clinical symptoms had gotten progressively worse. Dr. Glorioso described plaintiff’s traumatic brain injury as a permanent problem, which usually gets worse for most people with this type of condition. He said the brain atrophy being experienced by plaintiff explains his memory problems. He further stated that there is currently no surgical procedure available to correct this type of traumatic brain injury.


*5 Dr. Frank Johnston, an expert in orthopedics, testified that he first treated plaintiff in December 2010. After examining plaintiff and reviewing the lumbar and cervical spine MRI results, Dr. Johnston concluded that plaintiff had post-traumatic carpal tunnel syndrome, neck discomfort as a result of an annular tear and bulging disc in his neck and a disc herniation in his low back. He related all of these problems to the accident. Dr. Johnston recommended the MRI of the brain that plaintiff had in December 2011 based on plaintiff’s complaints of dizziness, blurred vision, light-headedness and a persistent humming/buzzing noise in his head. Dr. Johnston agreed with Dr. Glorioso’s interpretation of the MRIs. Dr. Johnston testified that he does not perform spinal surgery. He recommended that plaintiff have epidural steroid injections, and if those did not provide pain relief, he could then consult a surgeon to discuss his surgical options.


Dr. Susan Andrews, an expert in the field of neuropsychology, testified that she evaluated plaintiff in May 2012, and reviewed the report of the neuropsychologist retained by Dupuy to evaluate plaintiff. Based on her testing and evaluation, Dr. Andrews determined that plaintiff’s IQ has dropped 25 points since the accident. Testing also showed that plaintiff’s sense of smell has been impaired. Dr. Andrews’ impressions of plaintiff are that he has cognitive deficits that are consistent with damage to the brain, and an adjustment disorder with some depression because of the chronic pain and the fact that he was having difficulty doing his job. She gave him a diagnosis of borderline intellectual functioning. Her opinion is that these impairments are related to his coup contrecoup injury that has caused permanent brain damage. She said plaintiff’s condition will probably get worse over time, likely resulting in early dementia, which could require 24 hour a day care if it progresses to a certain point.


Dr. Morteza Shamsnia, an expert in neurology and psychiatry, electro diagnostic medicine, clinical neuropsychology and sleep medicine, first treated plaintiff in April 2012 for neurological complaints. Those complaints included vision changes, neck pain, low back pain, unusual noises in his head and memory loss. After viewing the brain MRI taken in 2011, Dr. Shamsnia noted abnormalities and ordered another brain MRI. At Dr. Shamsnia’s recommendation, plaintiff underwent EMG and nerve conduction studies. The results of those studies indicated carpal tunnel syndrome and a pinched/damaged nerve in his neck. Dr. Shamsnia reviewed the MRI of the lumbar spine and stated that it showed L4–L5 disc herniation. He also suspected bulging in the L5–S1 area and there was clear evidence that the left L5 nerve root has been pinched and is under pressure. Dr. Shamsnia related plaintiff’s pinched nerve in his neck and herniation in his back to the February 2010 accident. His opinion is that plaintiff will need neck surgery. Dr. Shamsnia stated that the CT scan taken of plaintiff’s brain on the day of the accident showed no atrophy, which indicates he had no preexisting condition that would account for the atrophy that appeared on subsequent MRIs. He testified that the 2011 MRI showed atrophy that was not present in the 2010 CT scan, and the 2012 MRI showed that the atrophy had worsened since the 2011 MRI. The brain MRIs also showed gliosis, or scarring. Both MRIs showed coup contrecoup brain injury as well. Dr. Shamsnia testified that plaintiff’s brain atrophy will probably get worse, but will not get better. Stated another way, he said that plaintiff has permanent, lifelong brain damage from his coup contrecoup injury.


*6 Dupuy presented the testimony of Dr. John Allen Davis, Jr., an expert in orthopedic medicine and surgery. Dr. Davis performed an independent medical evaluation of plaintiff. He reviewed the medical records, test results and depositions, and examined plaintiff. His opinion is that plaintiff’s disc problems that appeared on diagnostic tests are the result of degenerative changes that are not uncommon for a man his age. He disagreed with Dr. Glorioso’s opinion that plaintiff has a herniation at L4–L5. Dr. Davis does not believe that the neck and back pain being experienced by plaintiff is related to the accident. He further stated that the carpal tunnel syndrome seen in plaintiff was probably related to his occupation, but was not related to the accident. Dr. Davis would not recommend surgery for plaintiff, but would recommend injections for his disc problems. In his opinion, the MRI and imaging studies performed on plaintiff did not show significant trauma.


Dr. Kevin Greve, an expert in the field of clinical neuropsychology, also testified on behalf of Dupuy. He performed a neuropsychological evaluation of plaintiff, and reviewed his medical records, including the report from neuropsychologist, Dr. Susan Andrews. He said he could not ascertain from the records if plaintiff actually lost consciousness after the accident, but the records do indicate that he sustained a concussion. Dr. Greve concluded that while plaintiff was not malingering, the physical and mental issues he continued to have at the time of trial demonstrated problems with concentration, depression and slowed mental speed. He stated that he does not believe that these mild, non-specific symptoms are still related to the accident at this point.


On cross-examination, Dr. Greve conceded that plaintiff’s psychological state, his physical symptom presentation, and attention/concentration problems probably are related to the accident. He also agreed that plaintiff sustained a mild traumatic brain injury from this accident. He also agreed that physical signs like dizziness, vision disturbance, and buzzing sounds in the head can be physical manifestations of a traumatic brain injury. Dr. Greve admitted that brain atrophy takes time to develop following an injury. He estimated plaintiff’s pre-accident IQ could have been as high as 82, and was currently around 65.


Given the evidence presented, and applying the standard set forth in Youn v. Maritime Overseas Corp., supra, we cannot conclude that the trier of fact abused its vast discretion in its general damages award to plaintiff. Dupuy’s argument that the amount awarded to plaintiff for general damages was excessive is based on evidence supporting its contention that the injuries suffered by plaintiff in the accident were much less serious than those alleged by plaintiff. However, the record also contains ample evidence in support of plaintiff’s claim that the injuries he suffered in the February 2010 accident have significantly damaged his life, causing him ongoing physical and mental pain and suffering, loss of enjoyment of life and permanent disability. Even though Dupuy offered evidence that conflicted with the evidence presented by plaintiff, there was a reasonable basis in the record to support the general damages award in this case. Therefore, we find it unnecessary to resort to a review of damage awards made in other cases. See Williams, 10–0457, p. 23, 46 So.3d at 281 (citing Theriot v. Allstate Ins. Co., 625 So.2d 1337, 1340 (La.1993) (where the court held that after an appellate court determines that the fact-finder abused its discretion, it can then review prior awards to determine the appropriate modification of the award)).


*7 For the reasons stated above, the trial court judgments of October 29, 2012 and January 2, 2013 are affirmed.



Lewis Brass and Copper Co. v. ABF Freight System, Inc.

United States District Court,

E.D. New York.





No. 13–CV–3251.

Signed March 13, 2014.


Wexler Burkhart Hirschberg & Unger, LLP, by: Ian J. Fri met, Garden City, NY, for Plaintiff.


Barry N. Gutterman & Associates, by: Barry N. Gutterman, Bedford Hills, NY, for Defendants.



JOHN GLEESON, District Judge.

*1 Lewis Brass and Copper Company (“LBC”) brings this action against ABF Freight System, Inc. (“ABF”) for the loss of two shipments of copper shipped by LBC using ABF’s freight services. L BC asserts claims under state law as well as the Carmack Amendment, 49 U.S.C. § 14706. ABF has moved for summary judgment. I conclude that L BC’s state law claims are preempted, and that LBC’s Carmack Amendment fails because the losses were attributable solely to its own actions. I also conclude that, because ABF complied with the terms of its contract but has not yet been paid, it is entitled to judgment on its counterclaim for breach of contract. Thus, I grant ABF’s motion for summary judgment.



A. Factual Background

The following facts are taken from the parties’ Local Rule 56.1 statements and affidavits. Unless otherwise noted, the facts set forth below are uncontroverted.


According to the statement of Martin Erdfarb, LBC’s CFO, LBC was contacted by two people—claiming to be Scott Ellis and Derick L amberti—in May of 2012. They purported to represent a roofing company, S & C Roofing Gutters (“S & C”), in Illinois. On May 17, S & C contracted with LBC for $22,720.54 of copper, paid by credit card. Erdfarb Aff. ¶¶ 2–3, ECF No. 25.


On May 29, 2012, LBC contracted with ABF to ship that order—in the form of two skids of copper—from Glendale, New York to an address in Chicago, Illinois. LBC prepared a bill of lading for the shipment, which listed the Chicago address as the destination, S & C as the consignee, and the instruction to “Call before delivery Scott (773) 683–7474.” Crouse Aff., Ex. A, ECF No. 23–1. The shipment arrived without incident at ABF’s shipping dock in Sauk Village, Illinois on May 31, 2012. It is disputed whether ABF called Scott or whether Scott called A BF, but a phone conversation did occur, and Scott told A B F that S & C would pick the delivery up from A B F’s dock. An apparent S & C designee, Kenneth, picked up the shipment on May 31; he signed his name and entered his driver’s license number, though his last name was illegible. Def.’s Rule 56.1 Statement, ¶¶ 4–13, ECF No. 21; Pl.’s Rule 56.1 Statement, ¶¶ 4–13, ECF No. 26.


On June 1, LBC contracted with S & C for a second order of copper worth $20,822.82. Payment was split between two credit cards. LBC again contracted with ABF to ship the order to the same Chicago address and included the same instruction to call Scott. Erdfarb Aff. ¶¶ 7–9; Crouse Aff., Ex. C, ECF No. 23–1. The shipment contract was entered into on June 7, and the shipment was delivered to ABF’s Chicago shipping dock on June 11. Again there is a dispute about whether ABF called Scott or vice versa, but once again the cargo was picked up by an apparent S & C designee, this time a John Greene, who signed his name and printed his driver’s license number on a delivery receipt. Def.’s Rule 56.1 Statement, ¶¶ 8–12, 14–15.


Shortly after the shipments were picked up, the banks processing the credit card payments for the orders informed LBC that the charges were being disputed because the card holders claimed that their cards had been stolen. After fighting the disputed charges, LBC ultimately was not paid for the shipments. Erdfarb Aff. ¶¶ 11–12. Upon investigation, LBC also learned that the license numbers provided when the loads of cargo were picked up were fake, and that the phone number provided for Scott was also fake. Id. ¶¶ 16, 19. Furthermore, the address that S & C had originally provided to LBC is, according to L BC’s Amended Complaint (in turn based on an image from Google Maps), “an empty lot in a dilapidated part of Chicago.” A m. Compl. ¶ 37 & Ex. J, ECF No. 16.


*2 LBC commenced this action in state court, and it was removed by ABF on June 6, 2013. After LBC amended its complaint to assert a claim under the Carmack Amendment, ABF moved for summary judgment. I heard argument on the motion on February 28, 2014.FN1


FN1. The day before argument, counsel for LBC sought leave to file a surreply in opposition to ABF’s motion for summary judgment. The request is denied. LBC had an opportunity to make all of its arguments in opposition.



A. Summary Judgment Standard

A court may grant summary judgment where “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.” Fed.R.Civ.P. 56(a). A fact is “material” if its resolution “might affect the outcome of the suit under the governing law.”   Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A dispute is “genuine” when “the evidence is such that a reasonable jury could return a verdict for the nonmoving party.” Id. In determining whether there are genuine disputes of material fact, the court must “resolve all ambiguities and draw all permissible factual inferences in favor of the party against whom summary judgment is sought.” Terry v. Ashcroft, 336 F.3d 128, 137 (2d Ci r.2003).


B. Removal and State Law Claims

Although neither party addresses the matter, I note briefly (in order to satisfy myself that subject matter jurisdiction lies in this court) that removal of the case from state court was proper. For essentially the same reasons, I also agree with ABF that plaintiff’s state law claims must be dismissed as preempted.


“Any action that was originally filed in state court may be removed by a defendant to federal court only if the case originally could have been filed in federal court.” Marcus v. AT & T Corp., 138 F.3d 46, 52 (2d Cir.1998) (citing 28 U.S.C. § 1441(a)). Where, as here, the requirements of diversity jurisdiction are not satisfied (here, the amount in controversy does not reach the statutory minimum, see 28 U.S.C. § 1332(a)), removal is permissible only if the case satisfies federal question jurisdiction.   Marcus, 138 F.3d at 52. “The presence or absence of federal question jurisdiction is governed by the well-pleaded complaint rule. That rule provides that federal question jurisdiction exists only when the plaintiff’s own cause of action is based on federal law, and only when plaintiff’s well-pleaded complaint raises issues of federal law.” Id. (internal citations omitted). In the vast majority of cases, that analysis is simple: removal on federal question grounds is permitted when the plaintiff has brought a federal cause of action.


This case does not fall into that simple category. The plaintiff did not bring any federal causes of action; the only claims in the original state complaint are for breach of contract and negligence. See Complaint, ECF No. 1, Ex. A, at ¶¶ 19–31. Nonetheless, removal was proper here under the doctrine of complete preemption. In some areas of l aw, Congress has manifested an intent to wholly occupy the field, and state causes of action are replaced by federal l aw. See, e.g., Lehmann v. Brown, 230 F.3d 916, 919 (7th Ci r.2000) (“State law is ‘completely preempted’ in the sense that it has been replaced by federal law….”). A plaintiff aggrieved in such an area of the law may only bring a federal cause of action—a putative state law claim must be read as a federal one—and therefore, such a claim is necessarily removable. See Marcus, 138 F.3d at 53.


*3 The Carmack Amendment is such an area of law. Although the Second Circuit has not expressly ruled on the matter, other federal courts have relied on the Supreme Court’s decision in Adams Express Co. v. Croninger, 226 U.S. 491, 505–07, 33 S.Ct. 148, 57 L.Ed. 314 (1913), to hold that when Congress enacted the Carmack Amendment to the Interstate Commerce Act in 1906, it intended to create a comprehensive—and exclusive—federal scheme to govern the field of interstate shipping liability. See, e.g., Smallwood v. Allied Van Lines, Inc., 660 F.3d 1115, 1120–23 (9th Cir.2011); Hoskins v. Bekins Van Lines, 343 F.3d 769, 772–78 (5th Cir.2003). As the Supreme Court explained, Congress stepped in to remedy the perceived problem of having many states’ disparate laws potentially apply to interstate shipping, and its regulatory scheme was so complete that the law must be read to “supersede all state regulation” of interstate shipping liability:


[T]his branch of interstate commerce was being subjected to such a diversity of legislative and judicial holding that it was practically impossible for a shipper engaged in a business that extended beyond the confines of his own state, or a carrier whose lines were extensive, to know, without considerable investigation and trouble, and even then oftentimes with but little certainty, what would be the carrier’s actually responsibility as to goods delivered … from one state to another….


That the legislation supersedes all the regulations and policies of a particular state upon the same subject results from its general character. It embraces the subject of the liability of the carrier under a bill of lading which he must issue, and limits his power to exempt himself by rule, regulation, or contract. Almost every detail of the subject is covered so completely that there can be no rational doubt but that Congress intended to take possession of the subject, and supersede all state regulation with reference to it.


Adams Express, 226 U.S. at 151–52 (internal quotation marks and citations omitted).


“Since Adams Express, courts have been nearly uniform in holding that the Carmack Amendment preempts state law remedies for loss or damage to goods shipped by common carriers.” Roberts v. N. Am. Van Lines, 394 F.Supp.2d 1174, 1179 (N.D.Cal.2004). Because the claims here are for “loss or damage to goods shipped by [a] common carrier[ ],” the state law claims in the original complaint—for negligence and breach of contract—are preempted.


Two conclusions result. First, removal was proper. Second, plaintiff’s state law claims (the second and third causes of action in the Amended Complaint) are preempted; therefore, I grant summary judgment to defendant on those claims.


C. Carmack Amendment Claims

The principal dispute is whether plaintiff’s Carmack Amendment claims survive summary judgment.


The Carmack Amendment “imposes something akin to strict liability” on carriers of goods. Mitsui Sumitomo Ins. Co., Ltd. v. Evergreen Marine Corp., 621 F.3d 215, 216 (2d Cir.2010) (per curiam). The plaintiff must first show a prima facie case by demonstrating “(1) delivery to the carrier in good condition; (2) arrival in damaged condition; and (3) the amount of damages caused by the loss.” Project Hope v. M/V IBN SINA, 250 F.3d 67, 73 n. 6 (2d Ci r.2001). The burden then shifts to the defendant to show one of several affirmative defenses. Id. “[T]he statute codifies the common-law rule that a carrier, though not an absolute insurer, is liable for damage to goods transported by it unless it can show that the damage was caused by (a) the act of God; (b) the public enemy; (c) the act of the shipper himself; (d) public authority; (e) or the inherent vice or nature of the goods.” Missouri Pac. R. Co. v. Elmore & Stahl, 377 U.S. 134, 137, 84 S.Ct. 1142, 12 L.Ed.2d 194 (1964) (internal quotation marks omitted).


*4 Defendant ABF does not contest, for the purposes of this motion, that LBC can establish a prima facie case. Rather, ABF argues—though not with total clarity—that the loss should be excused because it was due to the act of the shipper hi mself.FN2 See Def.’s Reply at 6, ECF No. 27.


FN2. In the context of interstate shipping law, the “carrier” is the party that does the transporting (here, ABF), while the “shipper” is the party whose goods are shipped (here, LBC).


Reported decisions on the “act of the shipper himself” defense focus on a shipper’s failure to properly package or otherwise prepare goods for transit. A leading treatise summarizes them as follows: “The defense encompasses such acts as a misdescri ption of the contents of the packages or containers by the shipper on the bill of lading, or defective loading or counting of the shipment where the shipment is specifically stated to be a shipper’s load and count shipment.” 1 Saul Sorkin, Goods in Transit § 5.10 (2013).


The defense is animated by the same idea underlying the general rule. The risk of harm to the goods is placed on the carrier while the goods are under its control, since the carrier is the cheapest cost avoider for accidents and damage occurring during this time. But other risks—such as the risks that goods are improperly labeled or packaged—are more easily avoided by the shipper. The principle extends to risks that the shipper would know, but the carrier would not: For example, one court held that a carrier would not be liable under the Carmack Amendment for freezing damage to a shipment of wine, since the shipper had not notified the carrier of any special handling requirements for the wine. Pilgrim Distrib. Corp. v. Terminal Transp. Co., Inc., 383 F.Supp. 204, 209–10 (S.D.Ohio 1974).


The facts of this case are somewhat different, but I conclude that the same principle should apply. The Carmack Amendment governs harms that occur during the shipping process, because those are the only harms for which it makes sense to shift the burden of risk to the carrier.FN3 The statute cannot properly be read to make a carrier liable for fraud that is collateral to the shipping process.


FN3. For example, as the Second Circuit has noted with respect to the Carriage of Goods by Sea Act, a similar provision governing liability of common carriers, “the whole point of the prima facie requirements,” the gateway to a COGSA claim, “is to establish that the damage to the goods occurred while under the supervision of the defendant.” Transatlantic Marine Claims Agency, Inc. v. M/V OOCL Inspiration, 137 F.3d 94, 99 (2d Cir.1998).


Before concluding that ABF’s summary judgment motion should be granted, though, I must explain why I am confident that the fraud here is “collateral to the shipping process.” After all, LBC contends that ABF was directly implicated in the fraud’s success. According to LBC, ABF did not call Scott’s number, and it is agreed that ABF did not deliver the shipments to the address specified. If ABF had done either of these things, LBC argues, the fraud would have been defeated: the phone number for “Scott” was fake, and the address was an abandoned lot. Had ABF discovered either fact and reported them to LBC, the order could have been canceled.


But these hypothetical possibilities, though plausible, do not make ABF responsible for the loss of the shipments. First, as to the phone call, there is a dispute about whether A BF called Scott or he called ABF, but there is no dispute that a phone conversation occurred. Except under extraordinary circumstances, I cannot see how an instruction to “call Scott” is not satisfied by simply having a phone conversation with him, whoever initiates the call.


*5 Second, as to delivery, ABF had no information that Scott (as representative of S & C) or his designee was not the proper recipient. Each bill of lading indicated “S & C” as the consignee. Under relevant sections of the Federal Bill of Lading Act, ABF was permitted to deliver the goods to “the consignee named in a nonnegotiable bill.” 49 U.S.C. § 80110(b)(2). “A ‘straight bill of lading,’ “ including both of the two bills involved here, “simply requires delivery of the goods to the consignee.” Id.; see also Electro Source v. UPS, 95 F.3d 837, 838 n. 3 (9th Cir.1996) (“A straight bill of lading is one in which the goods are consigned to a specific person.”). Similarly, ABF did not violate 49 U.S.C. § 80111(a)(1), governing liability on bills of lading, since it neither “del iver[ed] the goods to a person not entitled to their possession” (S & C was, under the terms of the bill, entitled to possession), and it did not run afoul of § 80111(a)(3), since it did not “ha[ve] information it is delivering the goods to a person not entitled to their possession.”


Federal decisions support my view. As a general matter, “[c]ommon carrier liability ceases upon delivery of the shipment to the consignee.” Republic Carloading & Distrib. Co. v. Missouri Pac. R. Co., 302 F.2d 381, 386 (8th Ci r.1962). “Since ‘delivery’ must mean delivery as required by the contract [of carriage], (i.e., the bill of lading and the tariffs), the intention of the parties defines its scope.” Intech, Inc. v. Consolidated Freightways, Inc., 836 F.2d 672, 674 (1st Cir.1987) (citing Georgia, F. & A. Ry. Co. v. Blish Milling Co., 241 U.S. 190, 195, 36 S.Ct. 541, 60 L.Ed. 948 (1916)). Here, the bills of lading—prominently labeled as straight bills—listed S & C as the consignee and contained directives to call the consignee before delivery. In each case, the consignee instructed ABF to keep the goods at its dock until a designee could pick them up. Had the instruction to call Scott been absent, LBC would have a stronger argument that the failure to deliver to the address named in the bills of lading constituted a failure to deliver the goods. But given the instruction, I understand that LBC and ABF contemplated that the consignee might give more specific instructions for delivery. Thus, ABF’s actions accord with the contractual intent in the bills of lading, since ABF apparently delivered the goods to S & C pursuant to the instructions.


Told in the most obvious way, this is not a story of negligence on either LBC’s or ABF’s part; rather, it is the story of LBC’s victimization by unknown fraudsters. Nonetheless, in the context of this bilateral suit, one the parties now before me has to bear the risk of the fraudulent orders. That party is LBC. ABF’s motion for summary judgment on LBC’s claims is granted. For essentially the same reasons, I find that ABF is entitled to payment for its services, since it complied with the terms of its contract. Therefore I grant summary judgment to ABF on its counterclaim for contractual damages in the amount of $1574.73.



*6 For the reasons stated above, ABF’s motion for summary judgment is granted.


So ordered.

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