Bits & Pieces

Bay Machinery Services, Inc. v. Codan Forsikring A_S,

United States District Court,

E.D. Arkansas,

Western Division.




Codan Forsikring A/S., Counter Claimant


Bay Machinery Services, Inc., Counter Defendant

Codan Forsikring, A/S., Plaintiff,


ATS Logistics Services, Inc., Defendant.

Nos. 4:08cv00368 SWW, 4:09cv00246 SWW.


July 10, 2009.






Assigned to this Court are two cases that stem from an accident that occurred in November 2004: Bay Machinery Services, Inc. v. Codan Forsikring, A/S., No. 4:08cv00368 SWW (filed April 29, 2008) (hereinafter, “Bay Machinery”), and Codan Forsikring, A/S. v. ATS Logistics Services, Inc., No. 4:09cv00246 SWW (filed April 2, 2009) (hereinafter “Codan ”). The plaintiff in Codan-Codan Forsikring A/S (Codan)-has filed a motion to consolidate the two cases [doc. # 10], claiming that both cases arise from the same factual situation, namely cargo, damages, and insurance claims over a wind turbine nacelle that was being transported by ship from the Kingdom of Denmark to Tiskalaw, Illinois.The defendant in Codan-ATS Logistics Services, Inc. (ATS)-opposes consolidation.


By Order dated January 27, 2009 [doc. # 26], the Court granted a joint motion of the parties in Bay Machinery to dismiss without prejudice separate defendants W.K. Webster (Overseas) Ltd., Vestas American Wind Technology, Inc., and Vestas Wind Systems A.S., leaving Codan Forsikring, A/S., as the sole remaining defendant in Bay Machinery.


A Notice of Related Case was filed in both Bay Machinery, No. 4:08cv00368 SWW (see doc. # 38] and Codan, No. 4:09cv00246 SWW (see doc. # 8).Codan was reassigned to this Court from the docket of Judge Moody pursuant to the Notice of Related Case as this Court had the first filed case, Bay Machinery .


The motion to consolidate was filed only in Codan, No. 4:09 cv00246 SWW.


According to the complaint in Bay Machinery, the nacelle cargo arrived in port in Beaumont, Texas, after which Bay Machinery, an Ohio corporation, picked up the nacelle cargo for transport to Illinois. On November 21, 2004, during transit of the nacelle cargo from Texas to Illinois, Bay Machinery’s vehicle was allegedly involved in a motor vehicle accident in Crossroads, Arkansas, causing the nacelle cargo to sustain damage. Codan, a corporation located in Copenhagen, Denmark, was the subrogated cargo underwriter of NEG Micon A/S, the shipper of the nacelle cargo. Codan has demanded and continues to demand payment exceeding $713,100 for damages to the nacelle cargo, but Bay Machinery claims the action is governed by the Carriage of Goods by Sea Act (“COGSA”), 46 U.S.C. §§ 30701 et seq., and that any claims against Bay Machinery related to the alleged damage sustained to the nacelle cargo is now time-barred under COGSA’s one-year statute of limitations.


Codan denies that COGSA applies in this situation and has counterclaimed against Bay Machinery for breach of contract of carriage regulated by the Carmack Amendment, 49 U.S.C. § 14706, as codified by the ICC Termination Act of 1995. Codan additionally brings its own action under the Carmack Amendment against ATS, a Delaware corporation, alleging ATS arranged for Bay Machinery to pick-up, receive and accept the nacelle cargo and that ATS agreed to transport and deliver the nacelle cargo in good order and condition pursuant to a contract but that the nacelle cargo was damaged in the November 2004 accident in Arkansas. Codan alleges that ATS’ failure to deliver the nacelle cargo in good condition constituted an actionable breach of its duties and that as a result of its failure, ATS has caused Codan to sustain damages in the sum of $713,100.


Federal Rule of Civil Procedure 42(a) provides that a court may consolidate actions before it that involve a common question of law or fact. As noted by the United States Court of Appeals for the Eighth Circuit in Enterprise Bank v. Saettele,


Rule 42(a) states that a district court may consolidate separate actions when those “actions involv[e] a common question of law or fact.”Fed.R.Civ.P. 42(a); see Seguro de Servicio de Salud v. McAuto Sys. Group, 878 F.2d 5, 8 (1st Cir.1989) (“The threshold issue is whether the two proceedings involve a common party and common issues of fact or law.”); see also Frazier v. Garrison I.S .D., 980 F.2d 1514, 1531 (5th Cir.1993) (“[A] trial court may consolidate multiple actions if the actions involve common questions of law or fact.”); Fleishman v. Prudential-Bache Sec., 103 F.R.D. 623, 624 (E.D.Wis.1984) (“There must be questions of law or fact common to the cases that are to be consolidated….”). Further, “consolidation is permitted as a matter of convenience and economy in administration, but does not merge the suits into a single cause, or change the rights of the parties, or make those who are parties in one suit parties in another.” Johnson v. Manhattan Ry., 289 U.S. 479, 496-97, 53 S.Ct. 721, 727-28, 77 L.Ed. 1331 (1933); see also United States v. Altman, 750 F.2d 684, 695 (8th Cir.1984) (consolidated suits maintain their separate identities); Kraft, Inc. v. Local Union 327, Teamsters, 683 F.2d 131, 133 (6th Cir.1982) (same). We examine whether the district court abused its discretion in ordering this consolidation.


21 F.3d 233, 235 (8th Cir.1994).


ATS opposes consolidation primarily on the ground that “[w]hile it is too early to say with any degree of certainty,” two “possible” results of consolidation “may be to trigger some sort of” adversarial relationship between Bay Machinery and ATS or to transform the party status of at least one of Codan’s adversaries. See Saettele, 21 F.3d at 236-37 (“[b]ecause no common issues of law or fact existed between the two lawsuits, consolidation to resolve a separate issue that involved only the plaintiffs in each of the two lawsuits resulted in the creation of both a third lawsuit and a common forum in which to resolve that lawsuit” and “also created an adversarial relationship between the parties who formerly both were plaintiffs in the two individual lawsuits,” affecting the district court’s jurisdiction over the third lawsuit). While these concerns may later justify revisiting the issue, they are at this time too speculative and unfounded to deny Codan’s motion to consolidate when the cases are otherwise clearly appropriate for consolidation; the legal issues are related and Bay Machinery and Codan involve parties with common interests and common questions of law and fact. SeeFed.R.Civ.P. 42(a). That being so, and concluding that consolidation would promote convenience and economy, Codan’s motion to consolidate the two cases [doc. # 10] is granted. Accordingly, Codan Forsikring, A/S. v. ATS Logistics Services, Inc., No. 4:09cv00246 SWW is hereby consolidated with Bay Machinery Services, Inc. v. Codan Forsikring A/S., No. 4:08cv00368 SWW. The Initial Scheduling Order entered in Codan, No. 4:09cv00246 SWW [doc. # 7] and the Final Scheduling Order (as amended) entered in Bay Machinery, No. 4:08cv00368 SWW [doc. # ‘s 13, 16] are hereby vacated. The Court will issue a new Scheduling Order for the now consolidated action in due course.


ATS also raises temporal problems concerning the scheduling order in Bay Machinery but that problem will be alleviated upon issuance of a new scheduling order (including new deadlines for conducting discovery) for the consolidated action.





Bay Machinery Services, Inc. v. Codan Forsikring A/S,

Slip Copy, 2009 WL 2019860 (E.D.Ark.)



Ace Motors, Inc. v. Total Transport, Inc.

United States District Court,

N.D. Illinois,

Eastern Division.

ACE MOTORS, INC., Plaintiff,


TOTAL TRANSPORT, INC., Eric R. Dughetti, Hani Elayyan, and Yousef M. Abualrob, Defendants.

No. 08 C 1552.


July 10, 2009.




GEORGE M. MAROVICH, District Judge.


Intervener Ermek Abdildaev (“Abdildaev”) filed a four-count complaint against plaintiff Ace Motors, Inc. (“Ace Motors”) and defendants Total Transport, Inc. (“Total Transport”), Eric R. Dughetti (“Dughetti”), Hani Elayyan (“Elayyan”) and Yousef M. Abualrob (“Abualrob”). Before the Court are two motions to dismiss intervener’s complaint. One motion was filed by plaintiff Ace Motors, and the other motion was filed by defendants Total Transport, Dughetti, Elayyan and Abualrob. For the reasons set forth below, the Court grants in part and denies in part the motions to dismiss.


I. Background


For purposes of this motion to dismiss, the Court takes as true the allegations in Intervener’s complaint. The Court also considers the documents Intervener attached to his complaint. SeeFed.R.Civ.P. 10(c).


Intervener Abdildaev decided to ship three vehicles he owned to Krygyzstan, where they were to be sold. He hired plaintiff Ace Motors  to ship the 2006 Lexus, the 2000 Toyota Landcruiser and the 1996 Mercedes. Intervener paid Ace Motors $1,100.00 and received an invoice. Intervener did not receive a bill of lading from Ace Motors.


Ace Motors was doing business as Five Seasons, but we refer to the entity as Ace Motors for simplicity.


Ace Motors, in turn, hired Total Transport to ship Abdildaev’s three vehicles and six others overseas. Intervener alleges that Ace Motors did not receive a bill of lading from Total Transport. Total Transport took possession of the vehicles, and before the truck carrying the vehicles had left the State of Illinois, the truck was involved in an accident. Approximately two days after the accident, Ace Motors’ president telephoned Abdildaev to tell him that two of his three vehicles were destroyed in the accident. Abdildaev had paid $61,000.00 for the destroyed vehicles.


II. Standard on a motion to dismiss


The Court may dismiss a claim pursuant to Rule 12(b)(6) of the Federal Rules of Civil Procedure if the plaintiff fails “to state a claim upon which relief can be granted.”Fed.R.Civ.P. 12(b)(6). In considering a motion to dismiss, the Court accepts as true all well-pleaded factual allegations and draws all reasonable inferences in the plaintiff’s favor. McCullah v. Gadert, 344 F.3d 655, 657 (7th Cir.2003). Under the notice-pleading requirements of the Federal Rules of Civil Procedure, a complaint must “give the defendant fair notice of what the … claim is and the grounds upon which it rests.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 127 S.Ct. 1955, 1964, 167 L.Ed.2d 929 (2007) (quoting Conley v. Gibson, 355 U.S. 41, 47, 78 S.Ct. 99, 2 L.Ed.2d 80 (1957)). A complaint need not provide detailed factual allegations, but mere conclusions and a “formulaic recitation of the elements of a cause of action” will not suffice. Bell Atlantic, 127 S.Ct. at 1964-1965. A complaint must include enough factual allegations to “raise a right to relief above a speculative level.” Bell Atlantic, 127 S.Ct. at 1965. “After Bell Atlantic, it is no longer sufficient for a complaint ‘to avoid foreclosing possible bases for relief; it must actually suggest that the plaintiff has a right to relief, by providing allegations that raise a right to relief above the speculative level.’” Tamayo v. Blagojevich, 526 F.3d 1074, 1084 (7th Cir.2008) (quoting Equal Employment Opportunity Comm’n v. Concentra Health Services, Inc., 496 F.3d 773, 776 (7th Cir.2007)).


III. Discussion


A. Intervener’s Carmack Amendment Claim


In Count I, intervener asserts a claim against plaintiff and defendants under the Carmack Amendment.


The Carmack Amendment governs “liability of a common carrier to a shipper for loss of, or damage to, interstate shipment.” North American Van Lines, Inc. v. Pinkerton Security Systems, Inc., 89 F.3d 452, 455 (7th Cir.1996). Prior to the passage of the Carmack Amendment, common carriers faced a patchwork of state regulation. The Carmack Amendment “created a nationally uniform rule of carrier liability concerning interstate shipments.” REI Transport, Inc. v. C.H. Robinson Worldwide, Inc., 519 F.3d 693, 697 (7th Cir.2008) (quoting North American Van Lines, 89 F.3d at 454).


Plaintiff Ace Motors and defendants move to dismiss Intervener’s Count I for the same reason. They argue that intervener failed to comply with a notice requirement set out in § 14706(e) of the Carmack Amendment. The movants misunderstand the Carmack Amendment.


The Carmack Amendment, itself, “neither requires written claims nor imposes any other restrictions on the form of notice.”See Wisconsin Packing Co., Inc. v. Indiana Refrig’r Lines, Inc., 618 F.2d 441, 444 (7th Cir.1980). Instead, the Carmack Amendment restricts a carrier’s ability to limit a shipper’s right to make a claim. Specifically, the Carmack Amendment provides:


A carrier may not provide by rule, contract, or otherwise, a period of less than 9 months for filing a claim against it under this section and a period of less than 2 years for bringing a civil action against it under this section.”


49 U.S.C. § 14706(e)(1) (emphasis added). The Court does not read that as a deadline imposed by the Carmack Amendment but rather as a limit to the carrier’s ability to impose by contract a deadline or notice requirement. If the carrier had contracted with the shipper for a notice requirement or deadline for filing a complaint, then such deadline would be enforceable (within the limits of § 14706(e)(1)).See Wisconsin Packing, 618 F.2d at 444 (“The Supreme Court has indicated that a bill of lading requirement that claims be made ‘in writing’ within a specified period of time will be enforced.”). The problem with movants’ argument, however, is that such a deadline or notice requirement should be set out in the bill of lading or some other contract in order to bind the shipper. See Lumbermens Mutual Casualty Co. v. GES Exposition Serv., Inc., 303 F.Supp.2d 920, 922 (N.D.Ill.2003). Intervener has, however, specifically alleged that he did not receive a bill of lading. Furthermore, intervener need not plead around movants’ affirmative defenses. Lewis v. City of Chi., 528 F.3d 488, 494 (7th Cir.2008).


Although the issue may come out differently at the summary judgment stage, this is a motion to dismiss. The Court denies movants’ motions to dismiss as to Count I.


B. Plaintiff’s state law claims.


In Count II, intervener asserts a claim against plaintiff Ace Motors for breach of contract. Intervener asserts that Ace Motors breached the contract by failing to deliver the vehicles to Krygyzstan, thereby damaging intervener in the amount of $61,000.00. In Count III, intervener asserts that Ace Motors negligently caused the destruction of intervener’s vehicles, thereby causing damage to intervener in the amount of $61,000.00. Finally, in Count IV, intervener asserts that defendants Total Transport, Dughetti, Elayyan and Abualrob negligently caused the destruction of intervener’s vehicle, thereby causing him damage in the amount of $61,000.00.


Ace Motors and the defendants move to dismiss Counts II, III and IV, respectively, on the grounds that those claims are preempted by the Carmack Amendment. The Court agrees.


In its attempt to ensure national uniformity via the Carmack Amendment, Congress preempted “state causes of action against carriers for damaged or lost goods.” REI Transport, 519 F.3d at 697. In REI Transport, the Seventh Circuit explained that the Carmack Amendment preempts only those state and common law remedies that are inconsistent with the Carmack Amendment. Id. at 698.The Seventh Circuit explained:


Congress regulated the field of interstate carrier liability to provide a uniform cause of action against carriers. But it did not preempt every claim related to damaged or lost goods. For example, if a shipper withholds a greater amount than what it was owed for damaged goods, a carrier could seek legal recourse for the difference or, as with carrier liability, the shipper may be liable for other ‘independently actionable harms that are distinct from the loss of, or the damage to, the goods.’Accordingly, claims that do not affect a carrier’s liability for lost or damaged goods-such as a suit by a carrier against a ‘person entitled to recover’ for non-payment-do not upend the uniformity effected by the Carmack Amendment and are therefore not preempted.


REI Transport, 519 F.3d at 698 (quoting Gordon v. United Van Lines, Inc., 130 F.3d 282, 289 (7th Cir.1997)).


In this case, it is clear that intervener’s claims for breach of contract and negligence are preempted by the Carmack Amendment. In Counts II, III, and IV, intervener seeks a remedy for damage to the vehicles that occurred during shipment. The amount of damages intervener seeks for those claims is the same amount he alleges as the value of the damaged vehicles. It is clear that intervener’s claims for breach of contract and negligence are preempted by the Carmack Amendment.


The Court grants movants’ motions to dismiss as to Counts II, III and IV. Counts II, III and IV of intervener’s complaint are hereby dismissed with prejudice.


IV. Conclusion


For the reasons set out above, the Court grants in part and denies in part plaintiff’s motion to dismiss. The Court grants in part and denies in part defendants’ motion to dismiss. Counts II, III and IV are dismissed with prejudice.

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