Rykard v. FedEx Ground Package System, Inc.

M.D.Ga.,2008.

United States District Court,M.D. Georgia,Columbus Division.

Billy B. RYKARD, Plaintiff,

v.

FEDEX GROUND PACKAGE SYSTEM, INC., Defendant.

No. 4:08-CV-74 (CDL).

Aug. 26, 2008.

ORDER

CLAY D. LAND, District Judge.

In this case, Plaintiff asserts state law claims for bailment, conversion, respondeat superior, and punitive damages arising from Defendant’s alleged loss of Plaintiff’s package. Presently pending before the Court are Defendant’s Motion to Dismiss (Doc. 3) and Plaintiff’s Motion to Amend (Doc. 12). For the following reasons, the Court grants Defendant’s Motion to Dismiss as to Plaintiff’s state law claims, lifts the stay of discovery, and grants Plaintiff’s Motion to Amend.

BACKGROUND

On February 6, 2008, Plaintiff entrusted a package to an employee-driver of Defendant. (Compl.¶ 4.) At the time Plaintiff entrusted the package, the employee-driver was attired in a FedEx uniform. (Id.  ¶ 6.) The employee-driver logged the package under tracking number 997331900020438. (Ex. A to Def.’s Mot. to Dismiss.) The package entrusted to Defendant’s employee-driver contained rare coins with a value of $77,380. (Ex. A to Compl.) At some point in time after its tender on February 6, 2008, it was discovered that the package could no longer be tracked. A search ensued, but the package of rare coins was never recovered.

On May 15, 2008, Plaintiff filed suit against Defendant in the Superior Court of Muscogee County, alleging state law claims of bailment, conversion, respondeat superior, and punitive damages. (Compl.¶¶ 12-17.) Defendant filed a Notice of Removal on June 5, 2008. (See Def.’s Notice of Removal.) The parties filed a Motion Seeking Stay of Discovery, which was granted on July 8, 2008, pending the resolution of Defendant’s Motion to Dismiss. (See Consent Mot. Seeking Stay of Disc.) Presently pending before the Court are Defendant’s Motion to Dismiss, filed on June 6, 2008, and Plaintiff’s Motion to Amend, filed on July 7, 2008.

DISCUSSION

I. Motion to Dismiss

Defendant moves to dismiss Plaintiff’s Complaint for failure to state a claim upon which relief can be granted. SeeFed.R.Civ.P. 12(b)(6).“[T]he analysis of a 12(b)(6) motion is limited primarily to the face of the complaint and attachments thereto.”Brooks v. Blue Cross & Blue Shield of Fla., Inc., 116 F.3d 1364, 1368 (11th Cir.1997) (per curiam). In reviewing a motion to dismiss under Rule 12(b)(6), a court must “constru[e] the complaint in the light most favorable to the plaintiff and accept[ ] as true all facts which the plaintiff alleges.”Day v. Taylor, 400 F.3d 1272, 1275 (11th Cir.2005).

“Of course, ‘a formulaic recitation of the elements of a cause of action will not do.’ “  Watts v. Fla. Int’l Univ., 495 F.3d 1289, 1295 (11th Cir.2007) (quoting Bell Atl. Corp. v. Twombly, — U.S. —-, 127 S.Ct. 1955, 1965, 167 L.Ed.2d 929 (2007)). A complaint must include sufficient factual allegations “to raise a right to relief above the speculative level” and “to raise a reasonable expectation that discovery will reveal evidence of” the plaintiff’s claim or claims. Id. at 1295, 1296 (quoting Twombly, 127 S.Ct. at 1965) (internal quotation marks omitted).

Defendant contends that Plaintiff’s state law claims are preempted by the Carmack Amendment. See49 U.S.C. § 14706. Plaintiff contends that the Carmack Amendment is not applicable in this case. Defendant’s Motion to Dismiss is granted because the Carmack Amendment clearly preempts Plaintiff’s state law bailment, conversion, respondeat superior, and punitive damage claims.

“The Carmack Amendment creates a uniform rule for carrier liability when goods are shipped in interstate commerce.”Smith v. United Parcel Serv., 296 F.3d 1244, 1246 (11th Cir.2002); see49 U.S.C. § 14706. “To accomplish the goal of uniformity, the Carmack Amendment preempts state law claims arising from failures in the transportation and delivery of goods.”Smith, 296 F.3d at 1246. The United States Supreme Court has noted that the preemptive effect of the Carmack Amendment is very broad: the Carmack Amendment embraces “all losses resulting from any failure to discharge a carrier’s duty as to any part of the agreed transportation[.]”Ga., Fla. & Ala. Ry. Co. v. Blish Milling Co., 241 U.S. 190, 196, 36 S.Ct. 541, 60 L.Ed. 948 (1916).

The facts in this case are very similar to the facts in the Smith case. In Smith, the plaintiffs brought state claims against the defendant, alleging fraud, negligence, wantonness, and outrage based on the defendant’s failure in the transportation and delivery of goods. 296 F.3d at 1245. The Eleventh Circuit held that the state law claims were preempted by the Carmack Amendment because the claims arose from the alleged loss and misdelivery of the goods.Id. at 1249.The Eleventh Circuit noted that there may be situations in which the Carmack Amendment does not preempt state law claims, but it stressed that “separate and distinct conduct rather than injury must exist for a claim to fall outside the preemptive scope of the Carmack Amendment.”Id.

Here, Plaintiff’s bailment, conversion, respondeat superior, and punitive damage state law claims arose directly from Defendant’s alleged failure in the transportation and delivery of Plaintiff’s property. (See Compl. ¶¶ 12-17.) Plaintiff has failed to allege any facts that demonstrate that his state law claims arose separately and distinctively from Defendant’s conduct, and the Court is hard-pressed to find them. Thus, Plaintiff’s state law claims are preempted by the Carmack Amendment, and accordingly, Defendant’s Motion to Dismiss as to Plaintiff’s state law claims is hereby granted.

II. Motion for Leave to File Amended Complaint

Plaintiff seeks leave to file an amended complaint which would assert a count under the federal Carmack Amendment. See49 U.S.C. § 14706. The Federal Rules of Civil Procedure provide that “[a] party may amend its pleading once as a matter of course … before being served with a responsive pleading [.]”Fed.R.Civ.P. 15(a)(1). After a responsive pleading has been filed, “a party may amend its pleading only with the opposing party’s written consent or the court’s leave.”Fed.R.Civ.P. 15(a)(2). A “court should freely give leave when justice so requires.”Id.“[T]rial courts have broad discretion in permitting or refusing to grant leave to amend.”Garfield v. NDC Health Corp., 466 F.3d 1255, 1270 (11th Cir.2006).

Plaintiff’s Complaint was filed in the Superior Court of Muscogee County on May 15, 2008. (See Compl.) Defendant’s Answer was filed in the Superior Court of Muscogee County on June 5, 2008. (See Def.’s Answer.) Therefore, because an answer has already been filed and Defendant has not provided written consent, Plaintiff may only amend his Complaint with the Court’s leave.

Plaintiff’s Motion to Amend his Complaint was filed on July 7, 2008 less than sixty days after Plaintiff filed his original complaint. The Court observes that no discovery has been conducted, Plaintiff promptly filed his motion to amend, and his amended complaint is based upon the same conduct alleged in his original complaint. Therefore, the Court finds that Plaintiff should be permitted to amend his Complaint. Accordingly, Plaintiff’s Motion to Amend is hereby granted.

In addition, the Court lifts the stay of discovery imposed by the Court’s text-only Order on July 8, 2008.

CONCLUSION

In summary, the Court rules as follows:

(1) Defendant’s Motion to Dismiss (Doc. 3) is granted as to Plaintiff’s state law bailment, conversion, respondeat superior, and punitive damage claims.

(2) The stay of discovery ordered on July 8, 2008 is lifted.

(3) Plaintiff’s Motion to Amend his Complaint (Doc. 12) to assert a count under the federal Carmack Amendment is granted.

IT IS SO ORDERED.

White v. Mayflower Transit, L.L.C.

C.A.9 (Cal.),2008.

United States Court of Appeals,Ninth Circuit.

Zeddrick F. WHITE, Plaintiff-Appellant,

v.

MAYFLOWER TRANSIT, L.L.C., Defendant-Appellee.

No. 07-55528.

Submitted Feb. 26, 2008.FN*

Filed Sept. 12, 2008.

OPINION

BEEZER, Circuit Judge:

Zeddrick White (“White”) appeals pro se the district court’s order granting Mayflower Transit, L.L.C.’s (“Mayflower”) motion to dismiss his second amended complaint. We affirm.

I

This case arises out of an agreement between White and Mayflower, in which Mayflower agreed to ship White’s personal effects from New York to Los Angeles. White was dissatisfied with Mayflower’s delivery, claiming that several of his items were missing or damaged. The parties agreed to binding arbitration of the claims for loss and damage to White’s goods. The arbitrator ruled in favor of Mayflower, but White believed that the arbitrator had been biased against him. White filed a complaint against Mayflower in state court, alleging “contractual fraud (forgery), insurance coverage, general negligence, property damage and intentional infliction of emotional distress.”

Mayflower removed the case to federal court, arguing that White’s claims were exclusively governed by the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. § 14706. White moved to remand. The district court denied White’s motion, holding that Mayflower had properly removed the case under 28 U.S.C. § 1445(b).

Mayflower then moved to confirm the arbitration award. The court granted the motion, holding that White had failed to present evidence of actual bias on the part of the arbitrator. The court later directed White to file a second amended complaint setting forth any claims not precluded by the arbitration award.

White filed a second amended complaint containing the same allegations as his first complaint. Mayflower moved to dismiss White’s second amendment complaint. The court granted the motion, holding that all of White’s claims fell within the scope of a final and binding arbitration award. The court also construed White’s complaint as containing two possible causes of action for fraud/forgery and improper billing/ overcharging. The court held that the Carmack Amendment preempted these claims and dismissed White’s complaint with prejudice.

II

White argues that the district court lacked removal jurisdiction over this case. We disagree.

The Carmack Amendment is a federal statute that provides the exclusive cause of action for interstate shipping contract claims, and it completely preempts state law claims alleging delay, loss, failure to deliver and damage to property. Hall v. N. Am. Van Lines, Inc., 476 F.3d 683, 687-88(9th Cir.2007). If a plaintiff brings a contract action against an inter-state carrier for any of these reasons, and the amount in controversy exceeds $10,000, then the defendant may properly remove the case to federal court.Id. at 688-89.White sued Mayflower for property damage and admitted that the amount in controversy exceeds $10,000. The district court properly exercised removal jurisdiction over this case.

III

White argues that his claims for property damage do not fall within the scope of a final and binding arbitration award. White also argues that his remaining claims are neither barred nor preempted by the Carmack Amendment. We disagree.

A

We review de novo a district court’s order confirming an arbitration award. Schoenduve Corp. v. Lucent Tech., Inc., 442 F.3d 727, 730-31 (9th Cir.2006). We will affirm unless the award can be vacated, modified or corrected as prescribed by the Federal Arbitration Act (“FAA”).Id. The FAA allows a district court to vacate an arbitration award if there is evidence of partiality. 9 U.S.C. § 10(a)(2). The burden is on the moving party to show an arbitrator’s partiality by presenting evidence of either nondisclosure or bias. Woods v. Saturn Distrib. Corp., 78 F.3d 424, 427 (9th Cir.1996).

In opposing Mayflower’s motion to confirm the arbitration award, White summarily stated that “there was clearly some prejudice and bias” on the part of the arbitrator. White submitted no evidence specifically supporting this statement and he raised no additional reasons for why the district court should refrain from confirming the arbitration award. The district court properly confirmed the arbitration award, which is a final and binding ruling that precludes White from relitigating his claims for “contractual fraud,” “insurance coverage” and “property damage.”  See9 U.S.C. § 9.

B

The Carmack Amendment constitutes a complete defense to common law claims against interstate carriers for negligence, fraud and conversion, even though these claims may not be completely preempted. Hall, 476 F.3d at 689. The Carmack Amendment bars White’s claims for “general negligence,” as well as his possible claims for fraud/forgery and improper billing/overcharging.

C

[10] White’s only remaining claim is for intentional infliction of emotional distress. We have never addressed whether and under what circumstances the Carmack Amendment preempts a claim for intentional infliction of emotional distress. See Hunter v. United Van Lines, 746 F.2d 635, 643-44(9th Cir.1984) (declining to decide the issue). The United States Supreme Court makes clear that in enacting the Carmack Amendment, “Congress superseded diverse state laws with a nationally uniform policy governing interstate carriers’ liability for property loss.”N.Y., New Haven & Hartford Ry. Co. v. Nothnagle, 346 U.S. 128, 131, 73 S.Ct. 986, 97 L.Ed. 1500 (1953).“Almost every detail of [interstate common carrier liability] 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 Co. v. Croninger, 226 U.S. 491, 505-06, 33 S.Ct. 148, 57 L.Ed. 314 (1913).

Given this guidance, four circuits have discussed the issue whether and under what circumstances the Carmack Amendment preempts a claim for intentional infliction of emotional distress. Two circuits have articulated rules that focus on conduct. The Eleventh Circuit holds that “only claims based on conduct separate and distinct from the delivery, loss of, or damage to goods escape preemption.”Smith v. United Parcel Serv., 296 F.3d 1244, 1248-49 (11th Cir.2002) (emphasis added). Applying this rule, the Eleventh Circuit held that the Carmack Amendment preempted a plaintiff’s claim for intentional infliction of emotional distress because the claim arose solely from the defendant’s transportation and delivery services. Id. at 1249(noting that if the defendant had intentionally injured plaintiffs, the plaintiff’s claim would not have been preempted). Similarly, the Fifth Circuit held that the Carmack Amendment preempted a claim for intentional infliction of emotional distress when the plaintiff alleged only that a moving company failed to timely deliver its belongings. Moffit v. Bekins Van Lines Co., 6 F.3d 305, 306 (5th Cir.1993). To hold otherwise, the Fifth Circuit reasoned, would have defeated Congress’ purpose of creating uniform legislation to govern interstate shipping contracts. Id. at 307.

In contrast, two circuits have articulated rules that focus on harm. The First Circuit has stated, without deciding, that “a claim for intentional infliction of emotional distress alleges a harm… that is independent from the loss or damage to goods and … would not be preempted.”Rini v. United Van Lines, Inc., 104 F.3d 502, 506 (1st Cir.1997) (emphasis added). Relying on this dicta, the Seventh Circuit held that a plaintiff’s claim for intentional infliction of emotional distress was not preempted when the plaintiff alleged “liability on a ground that [was] separate and distinct from the loss of, or the damage to, the goods….”Gordon v. United Van Lines, Inc., 130 F.3d 282, 289 (7th Cir.1997).

Although the Seventh Circuit adopted the First Circuit’s language focusing on harm, the Seventh Circuit’s holding in Gordon was actually motivated by the defendant’s conduct. Id. at 283, 290.The Seventh Circuit was troubled by the fact that the defendant lied to the plaintiff and engaged in a “four-month course of deception pertaining to [their ] nondelivery.”Id. Indeed, a rule focusing on harm to the exclusion of conduct would contradict the Supreme Court’s statement that “[t]he words of the statute ‘are comprehensive enough to embrace all damages resulting from any failure to discharge a carrier’s duty with respect to any part of the transportation to the agreed destination.’ “  Se. Express Co. v. Pastime Amusement Co., 299 U.S. 28, 29, 57 S.Ct. 73, 81 L.Ed. 20 (1936) (per curiam); see also Ga., Fla. & Ala. Ry. Co. v. Blish Milling Co., 241 U.S. 190, 196, 36 S.Ct. 541, 60 L.Ed. 948 (1916).

[11][12] We hold that the Carmack Amendment preempts a claim for intentional infliction of emotional distress to the extent that it arises from the same conduct as the claims for delay, loss or damage to shipped property. In this case, White’s claim for intentional infliction of emotional distress is preempted because it is based solely on the same conduct giving rise to his claims for property damage.

IV

White’s claims for property damage fall within the scope of a final and binding arbitration award. The Carmack Amendment provides a complete defense to White’s claims for negligence, fraud and improper billing, and it preempts White’s claim for intentional infliction of emotional distress.

AFFIRMED.

FN* The panel unanimously finds this case suitable for decision without oral argument. SeeFed. R.App. P. 34(a)(2).