2021 WL 5493076

United States District Court, D. New Mexico.
WALTER N. DIXON, Plaintiff,
v.
STONE TRUCK LINE, INC., a foreign corporation, ISMAIL Y. TAWIL, RUSSELL STOVER CHOCOLATES, LLC, a foreign corporation, and RYAN TRANSPORTATION SERVICE, INC., Defendants.
No. 2:19-CV-000945-JCH-GJF
|
Filed 11/23/2021

MEMORANDUM OPINION AND ORDER
*1 Plaintiff Walter N. Dixon (“Dixon”) filed a Motion for Leave to File Amended Complaint and Reconsider its Order Dismissing Defendants Ryan Transportation Service, Inc. and Russell Stover Chocolates, LLC (Doc. 57) (ECF No. 69) on January 25, 2021. Plaintiff argues that the Court should permit him to add factual allegations against Defendants Ryan Transportation Service, Inc. (“Ryan”) and Defendant Russell Stover Chocolates, LLC (“Russell Stover”) based on evidence that he obtained in discovery that purportedly cure the deficiencies that resulted in the previous dismissal of claims against Ryan and Russell Stover. Plaintiff also argues that the Court may alternatively consider his motion as one to reconsider the Court’s prior order of dismissal (ECF No. 57) under Rule 54(b). In further support of his motion for leave to file an amended complaint, Plaintiff subsequently filed on May 24, 2021, Plaintiff’s Motion for Leave to File Supplemental Evidence in Support of Plaintiff’s Motion for Leave to File Amended Complaint and Reconsider its Order Dismissing Defendants Ryan Transportation Service, Inc. and Russell Stover Chocolates, LLC (Doc. 69) (ECF No. 81). According to Plaintiff, he recently obtained additional evidence in discovery that supports his request to amend his complaint and asks the Court for leave to file the evidence and to consider it. Defendants Ryan and Russell Stover oppose both motions. The Court, having considered the motions, briefs, arguments, evidence, and applicable law, concludes that the motion for leave to file supplemental evidence should be granted only for a limited purpose, and that the motion for leave to file an amended complaint that alleges negligence claims against Ryan and Russell Stover should be granted in part and denied in part. The Court will permit Plaintiff to file his proposed amended complaint asserting negligence claims against Ryan and Russell Stover for direct and vicarious liability, but the Court will deny the motion to amend as to the joint liability theory of liability (Count V) and as to a statutory employer theory of liability against Russell Stover because of futility of amendment.

I. FACTUAL BACKGROUND
A. Introduction
According to Plaintiff’s first amended complaint (“FAC”), on October 28, 2018, Plaintiff Walter N. Dixon was operating his motorcycle with the right-of-way in Deming, New Mexico, when a commercial semi-truck operated by Defendant Ismail Y. Tawil (“Tawil”), acting in the course of his employment with Defendant Stone Truck Line, Inc. (“Stone Truck”), failed to yield to Dixon, made an unsafe left turn, drove into Dixon’s line of traffic, and collided with Dixon. (FAC ¶¶ 1-2, 25, ECF No. 20.) Stone Truck was the owner of the semi-truck driven by Tawil and was Tawil’s statutory employer. (Id. ¶¶ 8, 58.) At the time, Tawil was pulling a trailer loaded with goods being shipped by Russell Stover. (Id. ¶ 27.) Ryan, a business that brokers the transportation and shipment of goods across the United States, arranged for the transportation of Russell Stover’s goods by Stone Truck. (Id. ¶¶ 18-19.)

B. Procedural History
*2 Plaintiff filed suit against Tawil, Stone Truck, and Russell Stover for negligence on August 14, 2019 in state court. (Pl.’s Compl., ECF No. 1-2). After removal to federal court, on January 24, 2020, Plaintiff filed his FAC adding a claim for negligence against Ryan as well. (FAC ¶¶ 66-77, ECF No. 20.) In February 2020, Ryan and Russell Stover filed motions to dismiss (ECF Nos. 23, 31.) The Court sua sponte issued an Order Staying Discovery (ECF No. 43) as between all parties on April 21, 2020, until the presiding judge ruled on the pending motions to dismiss. While discovery was stayed, on June 24, 2020, Plaintiff filed a motion for leave to file his proposed second amended complaint (“SAC”). (Pl.’s Mot., ECF No. 49.)

On December 3, 2020, this Court entered a Memorandum Opinion and Order (ECF No. 57), granting Ryan’s and Russell Stover’s respective motions to dismiss under Rule 12(b)(6) for failure to state a claim against them. The Court also denied Plaintiff’s motion to file his SAC based on futility. (Mem. Op. and Order 32-37, ECF No. 57.) Although the Court dismissed Ryan and Russell Stover from the case, the Court’s opinion did not state whether it was with or without prejudice. (See id. at 39.)

Discovery resumed in this case on December 18, 2020, with entry of the Court’s Order Setting Pretrial Deadlines and Briefing Schedule (ECF No. 61). That Order set a February 16, 2021 deadline for amending the complaint. (Order 1, ECF No. 61.) Shortly thereafter, Plaintiff requested Tawil’s driver qualification file, electronic tracking or logs, among other discovery, which Plaintiff received on or about January 5, 2021. (See Pl.’s Reply, Ex. A, ECF No. 74 at 12-13 of 57.) On January 25, 2021, Plaintiff filed his motion for leave to file his proposed amended complaint and to reconsider (ECF No. 69). Months later, on May 24, 2021, Plaintiff moved for leave to file supplemental evidence he received in discovery that, according to Plaintiff, supports his motion to amend. (See Pl.’s Mot. for Leave, ECF No. 81). The Court subsequently granted Plaintiff’s motion to extend pretrial deadlines for discovery until April 15, 2022. (Order, ECF No. 101.)

C. New Allegations in Proposed Amended Complaint1
In the proposed Third Amended Complaint (“TAC”), Plaintiff alleges that Tawil violated the hours-of-service rules for the Federal Motor Carrier Safety Act (“FMCSA”) and Federal Motor Carrier Safety Regulations (“FMCSR”) for a shipment organized, controlled, and directed by Stone Truck, Ryan, and Russell Stover. (TAC ¶ 29, ECF No. 69 at 31 of 70.) According to Plaintiff, Russell Stover and Ryan set the unsafe schedule for the route and driving conditions and required “time is of the essence” performance of the shipment, despite that the shipment could not reasonably be completed within the time required without violating the hours-of-service rules of the FMCSA and FMCSR while driving in accordance with driving laws. (Id.) Plaintiff asserts that the “delivery timeline required, or reasonably could expect Defendant Tawil to exceed the hours of service mandated by the Federal Motor Carrier Safety Act and Regulations, drive at unsafe speeds and disregard other safety issues for a trip of approximately 1,800 miles (according to Google Maps), especially factoring in traffic, road conditions, inspections or other factors, such that the delivery timeline was unsafe and unreasonable.” (Id. ¶ 52, ECF No. 44 of 70.) The TAC states that Ryan provided the schedule, logistics, mandatory documentation, tracking, and in-service communications en route. (Id. ¶ 46, ECF No. 69 at 37 of 70.) Plaintiff contends that Ryan is vicariously liable as the statutory employer of Tawil and as a motor carrier. (Id. ¶ 50, ECF No. 40-41 of 70.)

*3 Plaintiff asserts that Tawil, in entering the intersection, “drove unsafely, impaired by driving excessive hours, affecting his alertness, by failing to maintain proper lookout and failing to yield the right-of-way to Plaintiff Dixon.” (Id. ¶ 30, ECF No. 69 at 31-32 of 70.) Additionally, the TAC states that the semi-truck driven by Tawil was unsafe for operation on the public roadways because the electronic tablet on the front window was installed in a manner to cause distracted driving and block the visibility of the oncoming motorcycle driven by Dixon, and because the front turn signals were inoperable, as asserted by the police report made after the crash (Id. ¶ 32, ECF No. 69 at 32 of 70.)

Plaintiff contends that Stone Truck, Ryan, and Russell Stover knew or should have known from a reasonable investigation that Tawil was an unsafe driver because he had numerous driving citations issued to him and his driving record was in the possession of Stone Truck and available to Ryan and Russell Stover. (Id. ¶ 43, ECF No. 69 at 34-35 of 70.) Tawil’s driving record showed the following: “12/8/17 speeding violation; 8/6/17 violation for failure to obey yield sign; 3/11/16 violation for unsafe operation of a motor vehicle; 9/22/15 violation for improper backing; 4/12/15 violation for false record of duty service; 12/10/14 violation for operating a motor vehicle without proper brakes; 2/7/14 motor carrier regulations violations; 12/10/12 motor carrier regulations violations; 7/8/11 violation of registration; 12/7/08 violation for failure to obey traffic signal or light; 11/2/08 violation for operating vehicle without lights; 11/10/07 violation for failure to obey traffic signal; 11/10/07 speeding violation; 11/7/07 violation for failure to obey traffic control device or sign; 10/26/07 speeding violation; 10/26/07 failure to answer a citation or pay fine; 5/29/07 speeding violation.” (Id. ¶ 43, ECF No. 69 at 35 of 70.)

In the TAC, Plaintiff added more specific allegations about why Stone Truck was an unfit and incompetent motor carrier. (See id. ¶ 44, ECF No. 69 at 35-36 of 70.) According to Plaintiff, Ryan and Russell Stover knew or should have known that Stone Truck had three cancellations of federally-mandated insurance policies by its former insurers; involvement in various injury crashes, including a fatal crash shortly before the injury in this case; a “non-ratable” safety rating issued by the FMCSA in 2018; an unsafe driving score above 4.5 issued by the Safety Measurement System for many months within close temporal proximity to the October 28, 2018 crash; a lack of regulatory-compliant safety training and continued-safety programs for drivers; and failed to qualify Tawil as required by the FMCSA. (Id. ¶¶ 44-45, ECF No. 69 at 35-36 of 70.)

Plaintiff further asserts in the TAC that the Agreement between Ryan and Russell Stover gave Ryan contractual control of the shipment and exclusive control of the persons operating the equipment or otherwise engaged in transportation services. (TAC ¶ 23, ECF No. 69 at 29 of 70.) Plaintiff alleges that the Broker Addendum is not part of the Agreement because it was expressly omitted pursuant to Paragraphs 27(a), 27(b), 27(d), and 38 of the Agreement and it was not signed by Russell Stover’s Director of Transportation; and the Broker Addendum did not expressly exclude or control over the language of the Agreement. (Id., ECF No. 69 at 30 of 70.) According to the TAC, the Broker Addendum was signed before or at the same time as the Contract, so Paragraph 27(a) of the Contract annulled and rendered unenforceable the Broker Addendum. (See id. ¶ 51, ECF No. 69 at 41-43 of 70.) Plaintiff also alleges that Ryan arranged for Stone Truck and Tawil to ship the goods; Ryan had exclusive control of the driver and commercial motor vehicle by contract and assumed full responsibility for the shipment; and Ryan certified in the Bill of Lading that it was functioning as the carrier. (Id. ¶¶ 20, 28, 50, ECF No. 69 at 28, 30-31, 41 of 70.) Alternatively, Plaintiff pleads in the TAC that Ryan misrepresented in the Bill of Lading its operations and capabilities to be that of a motor carrier and assumed responsibilities that it lacked. (See id. ¶ 22, ECF No. 69 at 29 of 70.)

*4 Furthermore, Plaintiff asserts that Russell Stover is a licensed motor carrier and experienced in the qualifications, responsibilities, and duties required under the FMCSA and regulations for the selection of motor carriers and drivers, hours of service, and qualifications of trucking companies and drivers. (Id. ¶ 53, ECF No. 44 of 70.) Plaintiff contends that Russell Stover is the statutory employer of Tawil and that Tawil acted as its agent based on its control over and involvement with the process of transporting the shipment. (Id. ¶¶ 53, 90, ECF No. 69 at 45, 61 of 70.)

Based on these allegations, Plaintiff seeks to add a negligence claim against Ryan in Count III based on vicarious liability and direct negligence theories. (Id. ¶¶ 78-86, ECF No. 69 at 54-60 of 70.) Plaintiff contends that Ryan is vicariously liable as a motor carrier and statutory employer of Stone Truck and Tawil, is vicariously liable because Tawil acted as its agent, and is directly negligent for its hiring of Stone Truck, unsafe scheduling, and failing to exercise ordinary care in the maintenance, servicing, equipment, and inspection of the truck. (See id.) In Count IV, Plaintiff proposes to add a negligence claim against Russell Stover for vicarious liability and direct negligence (See id. ¶¶ 87-98, ECF No. 69 at 60-68 of 70.) Plaintiff asserts that Russell Stover is vicariously liable as a motor carrier and statutory employer of Ryan, Stone Truck, and Tawil, and because Tawil was acting as its agent. (Id. ¶¶ 90-91, ECF No. 69 at 60-61 of 70.) As for direct negligence, Plaintiff claims Russell Stover negligently failed to ensure the truck was properly and safely maintained and equipped, negligently hired its carriers, and negligently failed to prevent drivers from driving more than allowed by the hours-of-service laws, among other negligent acts. (See id. ¶¶ 93-95, ECF No. 69 at 62-65 of 70.) Finally, Plaintiff moves to add Count V for joint enterprise liability of Russell Stover, Ryan, and Stone Truck. (Id. ¶¶ 99-107, ECF No. 66-68 of 70.)

II. STANDARD
Generally, a court should freely give leave to amend a complaint when justice so requires. Fed. R. Civ. P. 15(a)(2). Whether to allow amendment of the pleadings is within the discretion of the trial court. Minter v. Prime Equipment Co., 451 F.3d 1196, 1204 (10th Cir. 2006). The purpose of Rule 15 “is to provide litigants the maximum opportunity for each claim to be decided on its merits rather than on procedural niceties.” Id. at 1204 (internal quotations omitted). Leave sought must be freely given in the absence of any justifiable reason for the denial of the motion, such as undue delay, bad faith, repeated failure to cure deficiencies by amendments, undue prejudice, or futility of amendment. Foman v. Davis, 371 U.S. 178, 182 (1962). A proposed amendment is futile if the complaint, as amended, would be subject to dismissal for any reason, including that it would not survive a motion to dismiss or a motion for summary judgment. Watson ex rel. Watson v. Beckel, 242 F.3d 1237, 1239-40 (10th Cir. 2001); Bradley v. Val-Mejias, 379 F.3d 892, 901 (10th Cir. 2004) (quoting Jefferson County Sch. Dist. v. Moody’s Investor’s Services, 175 F.3d 848, 859 (10th Cir. 1999)).

After a scheduling order deadline has passed, a party seeking leave to amend must not only satisfy Rule 15(a)’s standard but also demonstrate good cause for seeking modification under Federal Rule of Civil Procedure 16(b)(4). Gorsuch, Ltd., B.C. v. Wells Fargo Nat. Bank Ass’n, 771 F.3d 1230, 1240-41 (10th Cir. 2014). Rule 16(b)(4)’s good-cause standard means showing that the scheduling deadlines cannot be met despite the plaintiff’s diligent efforts, for example, if the plaintiff learned new information in discovery or if the underlying law changed. Id. at 1240. A court may generally find good cause when the plaintiff has been diligent, where the need for more time was not foreseeable or the party’s fault, and when refusing to grant the amendment would create a substantial risk of unfairness to the party. See Tesone v. Empire Marketing Strategies, 942 F.3d 979, 988 (10th Cir. 2019). Mere carelessness does not satisfy the diligence requirement. Id. at 989. Although prejudice is relevant to the inquiry, the focus is on the moving party’s reasons for seeking the change. See id. at 988. The Tenth Circuit has “noted the ‘rough similarity’ between the ‘undue delay’ standard of Rule 15 and the ‘good cause’ standard of Rule 16.” Bylin v. Billings, 568 F.3d 1224, 1231 (10th Cir. 2009) (citing Minter, 451 F.3d at 1205 n. 4).

*5 With respect to the standard for motions to reconsider, Rule 54(b) provides:
When an action presents more than one claim for relief … or when multiple parties are involved, the court may direct entry of a final judgment as to one or more, but fewer than all, claims or parties only if the court expressly determines that there is no just reason for delay. Otherwise, any order or other decision, however designated, that adjudicates fewer than all the claims or the rights and liabilities of fewer than all the parties does not end the action as to any of the claims or parties and may be revised at any time before the entry of a judgment adjudicating all the claims and all the parties’ rights and liabilities.
Fed. R. Civ. P. 54(b) (emphasis added). A court may reconsider its ruling based on (1) newly discovered evidence previously unavailable, (2) a change in the relevant law, or (3) to correct clear error or to prevent manifest injustice. Servants of Paraclete v. Does, 204 F.3d 1005, 1012 (10th Cir. 2000). A motion to reconsider is appropriate when the Court has misunderstood the facts, the arguments, or the law, but it “is not appropriate to revisit issues already addressed or advance arguments that could have been raised in prior briefing.” Id.

III. ANALYSIS
A. Motion for leave to file supplemental evidence
Defendants argue that Plaintiff’s motion for leave to file supplemental evidence is not permitted by the local rules. Defendants note that the supplemental argument in the motion is improper and should be stricken as a party must get leave of Court to file a sur-reply for argument that extends beyond a notice of supplemental authority. Moreover, Defendants contend that the motion is unnecessary because the evidence submitted was not new evidence and was known to Plaintiff at the time that he filed his most recent motion to amend and to reconsider. Russell Stover seeks to strike the exhibits and the costs required to respond to the motion. (See Def. Russell Stover’s Resp. 5-6, ECF No. 82.)

Plaintiff responds that the motion requests leave of Court, and the Court has discretion to construe the motion as a request to file a sur-reply. Plaintiff further asserts that he received responses to his requests for production (Exhibit K) from Stone Truck on April 30, 2021. (See Pl.’s Reply 5, ECF No. 87; Certificate of Service, ECF No. 79; Pl.’s Ex. K, ECF No. 81 at 30-39 of 39.) Plaintiff argues that this new evidence shows the necessity of reconsidering the dismissal of Ryan and Russell Stover from the case, because it shows Plaintiff did not have access to certain necessary documents until he was able to conduct discovery.

Defendants have raised the timeliness of Plaintiff’s attempt to amend, contending that Plaintiff had evidence in his possession or could have discovered such evidence in the public domain when he filed his initial suit. The Court finds that the evidence is relevant to the issue of the timeliness of Plaintiff’s motion to amend, to when he discovered certain evidence, and to his diligence. The Court will therefore grant the request to consider Plaintiff’s supplemental evidence, but it will only consider the underlying evidence as it pertains to the timeliness and diligence issues. On the issue of futility of amendment, the Court will examine the factual allegations made in the proposed TAC, and any documents made central to and referred to in the complaint, but it will not consider the underlying evidence or the merits of evidence that a party may present at trial. See Smith v. U.S., 561 F.3d 1090, 1098 (10th Cir. 2009) (explaining that, on Rule 12(b)(6) motion, court does not weigh potential evidence that parties might present at trial; rather, it assesses on a plausibility standard whether plaintiff’s complaint alone is legally sufficient to state a claim for which relief may be granted); Pace v. Swerdlow, 519 F.3d 1067, 1072-73 (10th Cir. 2008) (explaining that court may properly consider on motion to dismiss documents central to plaintiff’s claim and referred to in complaint, where document’s authenticity is not in dispute). Consequently, the Court will grant Plaintiff’s motion for leave to file supplemental evidence (ECF No. 81) and consider the evidence only for the limited purpose of analyzing the timeliness of Plaintiff’s motion to amend and to reconsider.

*6 The Court will not grant costs to Russell Stover. Nor will the Court grant Russell Stover’s request to submit an additional brief to address and respond to the new exhibits and the argument set forth in the motion that is addressed to the merits of its motion for reconsideration and to amend. The Court is considering the exhibits for the limited purpose of timeliness and the parties have extensively briefed that issue. Russell Stover responded to both the motion to amend and the motion to supplement and the Court has fully considered its arguments. The Court does not find good cause to re-open the briefing further.

B. Motion to amend and to reconsider
1. Plaintiff’s amendment is not untimely or unduly prejudicial
Plaintiff contends that, because the Court stayed discovery on April 1, 2020, it foreclosed Plaintiff’s ability to discover the facts in Defendants’ possession that revealed their liability. Dixon asserts that in the discovery process he obtained Tawil’s driver qualification file and confirmation of load and trip documents that show Ryan as the carrier that accepted responsibility for the shipment.

Defendants argue that Plaintiff has not shown through evidence that he discovered new facts through discovery that were previously unavailable to him when he filed his prior SAC. According to Defendants, the load and trip documents, which included the shipping and delivery dates, were in his possession since February 2020 and nothing on the docket sheet suggests new discovery was served on Plaintiff in the relevant time frame. Defendants contend that Tawil’s driving records, Stone Truck’s business history, and its Safety Measurement System score are available from the internet and can be obtained from court websites or background check companies at low cost. Accordingly, they argue that Plaintiff has not shown Rule 16 diligence or met the standard under Rule 54 or Rule 15 to permit amendment.

While some of the evidence supporting certain of the new allegations may have been publicly available, not all of it appears to be, and some pertinent information underlying Plaintiff’s negligence theory was not in his possession at the time he filed the SAC. Plaintiff submitted evidence showing that he did not obtain Tawil’s driver qualification file that was in Stone Truck’s possession until discovery resumed in January 2021. (See Pl.’s Reply, Ex. A, ECF No. 74 at 12-13 of 57.) This discovery is the basis for some of the facts he alleges in the TAC that support his negligence claims, in particular his theory of negligent hiring. Because of this new discovery, the Court does not find that Plaintiff is attempting to make the complaint a moving target, but he is instead responding to the facts he discovers through the litigation process.

Moreover, Plaintiff filed his motion to amend prior to the most recent amendment deadline and discovery is ongoing until April 2022. The proposed amendments arise from the same subject matter as Plaintiff’s earlier pleadings. As the Tenth Circuit noted, the expenditure of time, money, and effort on litigation alone is not a ground for finding prejudice. Bylin v. Billings, 568 F.3d 1224, 1230-31 (10th Cir. 2009). The discovery process is ongoing and will not end until next year. Trial is not until June 2022, more than six months away. The Court therefore finds that the delay and any prejudice is not undue and that there is good cause under Rule 16 for seeking modification under Rule 16(b)(4). Cf. Minter, 451 F.3d at 1206-08, 1214 (concluding district court erred in striking new claim from pretrial order because plaintiff provided adequate explanation for delay in asserting new claim just three weeks before trial, shifting claim from manufacturer product liability against one defendant to alteration product liability against another defendant; amendment was in response to late disclosures from defendant, so it was not “untimely” or “unduly delayed”).

*7 “Rule 15 was promulgated to provide the maximum opportunity for each claim to be decided on its merits rather than on procedural niceties.” Hardin v. Manitowoc-Forsythe Corp., 691 F.2d 449, 456 (10th Cir. 1982). Although some new specific allegations in Plaintiff’s TAC may have been available from public sources or are based on documents Plaintiff had, Plaintiff did not receive other documents that support other specific factual allegations until after discovery reopened. Because Plaintiff has good cause to amend his complaint to add these latter facts based on documents newly in his possession, the Court will consider the merits of the proposed complaint as a whole. The Court is not interested in parsing the basis of each new fact and striking facts based on insufficiently new evidence. To do so would elevate form over substance. Instead, the Court will turn to the merits of the TAC by examining whether it states a claim against Ryan and Russell Stover. See Calderon v. Kansas Dept. of Social and Rehabilitation Servs., 181 F.3d 1180, 1186 (10th Cir. 1999) (“The liberal granting of motions for leave to amend reflects the basic policy that pleadings should enable a claim to be heard on its merits.”).

2. Plaintiff’s proposed amended complaint states negligence claims against Ryan and Russell Stover and is not futile
As discussed supra, a proposed amendment is futile if the amended complaint would be subject to dismissal. Bradley, 379 F.3d at 901. To survive dismissal, a complaint must set forth factual allegations that “raise a right to relief above the speculative level.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 555 (2007). When reviewing a plaintiff’s complaint in ruling on a 12(b)(6) motion, the court must accept all well-pleaded allegations as true and construe them in a light most favorable to the plaintiff. Smith v. United States, 561 F.3d 1090, 1098 (10th Cir. 2009). When determining futility at this stage, when discovery is not complete, the Court should assume the facts, as pled, are true, and rule as on a motion to dismiss, rather than examine futility on a motion for summary judgment standard. See Orozco v. Edwards, No. 1:18-cv-00769 KWR/SCY, 2020 WL 907767, at *2 (D.N.M. Feb. 25, 2020); Smith v. Board of Regents of Univ. of New Mexico, No. 10-CV-00518 MV/WDS, 2012 WL 13080781, at *2 (D.N.M. Mar. 26, 2012) (“The Court is not inclined to transform Rule 15(a)’s liberal ‘when justice so requires’ standard to that of a summary judgment motion.”).

a. The TAC states a negligence claim against Ryan
Generally, a party who employs an independent contractor is not liable for the harm caused by the negligence of the independent contractor or its servants. Restatement (Second) of Torts § 409. The reason is that the party who hires an independent contractor has no right to control the manner in which the work is done because it is regarded as the contractor’s own enterprise. See Puckrein v. ATI Transport, Inc., 186 N.J. 563, 574, 897 A.2d 1034 (N.J. 2006). Exceptions to this rule exist, however, in situations in which the principal is directly negligent, such as where the principal hires an incompetent contractor, or where it retains control of the manner and means of doing the work that is the subject of the contract. Id.

1) Plaintiff states a plausible direct negligence claim against Ryan based on negligent hiring and unsafe scheduling
According to Section 411 of the Restatement (Second) of Torts, an employer is liable for physical harm to third persons caused by its failure to use reasonable care to select a competent and careful contractor (a) to perform work that will involve a risk of physical harm unless it is skillfully and carefully done or (b) to perform any duty that the employer owes to third persons. Talbott v. Roswell Hospital Corp., 2008-NMCA-114 ¶¶ 10-12, 144 N.M. 753 (quoting and adopting Restatement (Second) of Torts § 411). To succeed on a negligent hiring claim, the plaintiff must show that “the employee was unfit, considering the nature of the employment and the risk he posed to those with whom he would foreseeably associate, and that the employer knew or should have known that the employee was unfit.” Valdez v. Warner, 1987-NMCA-076, ¶ 11, 106 N.M. 305 (internal citation omitted). The harm the plaintiff suffered must have arisen out of the particular quality of the independent contractor which made it negligent for the employer to select that contractor to perform the work. See Jones v. C.H. Robinson Worldwide, Inc., 558 F.Supp.2d 630, 643 (W.D. Va. 2008) (citing Restatement (Second) of Torts § 411 comment (b)).

*8 Numerous courts have recognized a claim for negligent hiring of an independent contractor in the context of the selection of a motor carrier by a broker or shipper. See Jones, 558 F.Supp.2d at 641-42 (and cases cited therein, L.B. Foster Co. v. Hurnblad, 418 F.2d 727, 729 (9th Cir. 1969); Hudgens v. Cook Indus., Inc., 521 P.2d 813, 816 (Okl.1973); Puckrein, 186 N.J. at 575). A company whose core purpose is the transportation of goods on the highways “has a duty to use reasonable care in the hiring of an independent trucker.” Puckrein, 186 N.M. at 579. A fact finder may reasonably infer that a carrier or broker would be incompetent based on a “lack of experience, poor financial condition, failure to respect federal certificate requirements, and willingness to do business at cut rates.” Hurnblad, 418 F.2d at 729-730.

In the Court’s prior Memorandum Opinion and Order, the Court concluded that “the proposed second amended complaint does not allege additional non-conclusory allegations against Defendant Ryan Transportation to state a claim for negligent hiring.” (Mem. Op. and Order 37, ECF No. 57.) Unlike the SAC, the TAC contains specific, non-conclusory facts explaining why Tawil was unfit and how Stone Truck and Ryan should have known he was unfit: Tawil’s driving qualification file showed numerous traffic citations, including for speeding, failure to obey a yield sign, and unsafe operation of a motor vehicle. The TAC also has more specific, non-conclusory facts showing the basis for why Ryan knew or should have known that it was hiring an unfit and incompetent motor carrier: Stone Truck had three cancellations of federally-mandated insurance policies by its former insurers; it had involvement in various injury crashes, including a fatal crash shortly before the injury in this case; it had a “non-ratable” safety rating issued by the FMCSA in 2018; it had an unsafe driving score above 4.5 issued by the Safety Measurement System for many months within close temporal proximity to the October 28, 2018 crash; it lacked regulatory-compliant safety training and continued-safety programs for drivers; and it failed to qualify Tawil as required by FMCSA laws. (TAC ¶¶ 43-45, ECF No. 69 at 34-36 of 70.) Presuming these allegations true, as this Court should on a Rule 12(b)(6) futility standard, they plausibly state a claim for negligent hiring. Cf. Hurnblad, 418 F.2d at 729-32 (refusing to overturn jury verdict against shipper for negligent selection of incompetent independent contractor to transport steel, despite shipper’s lack of actual knowledge of carrier’s incompetence, based on experienced shipper’s failure to make reasonable inquiry as to carrier’s competence); Riley v. A.K. Logistics, Inc., No. 1:15-cv-00069-JAR, 2017 WL 2501138, at *5 (E.D. Mo. June 9, 2017) (denying broker’s motion for summary judgment because factual questions existed for jury on whether broker negligently hired motor carrier where there was evidence motor carrier had poor BASIC scores and motor carrier’s insurance was cancelled because of low scores); Jones, 558 F.Supp.2d at 647 (concluding fact question existed on whether broker breached appropriate duty of inquiry in selecting competent carrier that must be submitted to jury).

Plaintiff also asserts that the TAC contains facts showing Ryan’s negligence for unsafe scheduling in violation of the FMCSA and FMCSR’s hours-of-service laws for a time-is-of-the-essence shipment. Plaintiff alleges that Ryan knew or should have known that Tawil violated the hours-of-service rules of the FMCSA and FMCSR because it controlled the shipment and required Tawil to drive with an unsafe schedule. (TAC ¶¶ 28-29, ECF No. 69 at 31 of 70.) Plaintiff additionally contends that Russell Stover and Ryan set the route and driving conditions that required time-is-of-the essence performance, performance of which could not reasonably be completed within the time required without violating driving and hours-of-service rules. (Id. ¶ 29.) According to Plaintiff, they required the shipment be picked up at 1300 hours on October 27, 2018 in Corsicana, Texas, and delivered by 900 hours on October 30, 2018, in Watsonville, California – a schedule that would reasonably anticipate Tawil driving in excess of the hours-of-service laws or driving at unsafe speeds. (TAC ¶ 52, ECF 69 at 44 of 70.) Plaintiff asserts that Tawil drove 780 miles by 1100 am, the time of the collision, which is in excess and in violation of the FMCSA and FMCSR, causing the collision. (Id.) As further evidence of control, Plaintiff alleges that Ryan provided the logistics, mandatory documentation, tracking, and in-service communications en route. (Id. ¶ 46, ECF No. 69 at 37 of 70.) These non-conclusory facts state a plausible claim against Ryan for direct negligence, and thus, Plaintiff has shown that amendment of the complaint to include this negligence theory would not be futile. See Restatement (Second) of Torts § 410 (“The employer of an independent contractor is subject to the same liability for physical harm caused by an act or omission committed by the contractor pursuant to orders or directions negligently given by the employer, as though the act or omission were that of the employer himself.”).

2) Plaintiff’s direct negligence claim against Ryan is not preempted
*9 In Ryan’s initial motion to dismiss, it argued alternatively that Plaintiff’s negligent hiring claim should be dismissed because it is preempted by the Federal Aviation Administration Authorization Act (“FAAAA”), 49 U.S.C. § 14501(c). (See Def. Ryan’s Mot. to Dismiss, 17-23, ECF No. 31). In this Court’s prior Memorandum Opinion and Order, it concluded that the allegations in the SAC did not state a claim against Ryan, and thus, it did not need to consider this preemption issue. (Mem. Op. and Order 19 n.8, ECF No. 57.) Because the Court has determined herein that the allegations of the TAC have enough factual detail to state a plausible negligent hiring claim against Ryan, it must now determine whether amendment would be futile because the claim is subject to dismissal on this alternative preemption ground.

“The party claiming preemption bears the burden of showing with specificity that Congress intended to preempt state law.” Mount Olivet Cemetery Ass’n v. Salt Lake City, 164 F.3d 480, 489 n.4 (10th Cir. 1998) (citing Silkwood v. Kerr-McGee Corp., 464 U.S. 238, 255, 104 S.Ct. 615, 78 L.Ed.2d 443 (1984)). The FAAAA expressly preempts certain state laws related to brokers:
[A] State … may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of any motor carrier … or any motor private carrier, broker, or freight forwarder with respect to the transportation of property.
49 U.S.C. § 14501(c)(1). The phrase “other provision having the force and effect of law” includes common law claims. Northwest Inc. v. Ginsberg, 572 U.S. 273, 284 (2014). The FAAAA, however, also contains a “safety exception,” expressly stating that the preemption provision “shall not restrict the safety regulatory authority of a State with respect to motor vehicles….’ ” 49 U.S.C. § 14501(c)(2).

To determine what domain Congress intended to preempt, the statutory language is the best evidence of that intent. See Dan’s City Used Cars, Inc. v. Pelkey, 569 U.S. 251, 260 (2013); Boyz Sanitation Serv., Inc. v. City of Rawlins, Wyoming, 889 F.3d 1189, 1198 (10th Cir. 2018) (explaining that in determining scope of an express preemption clause, courts “must use ordinary principles of statutory interpretation to evaluate whether the state law falls within the scope of the federal provision precluding state action”). Congress enacted the Airline Deregulation Act of 1978 (“ADA”), followed by the Motor Carrier Act of 1980, largely to deregulate the domestic airline industry and the trucking industry, respectively. Dan’s City, 569 U.S. at 255-56. To prevent States from undoing federal deregulation, Congress included preemption provisions in the ADA, prohibiting States from enacting or enforcing any law “related to a price, route, or service of an air carrier,” 49 U.S.C. § 41713(b)(1), and in the FAAAA, prohibiting state laws “related to a price, route, or service of any motor carrier … with respect to the transportation of property,” 49 U.S.C. § 14501(c)(1). See Dan’s City, 569 U.S. at 255-56. Congress enacted both the ADA and the FAAAA to maximize reliance on competitive market forces to lower fares and provide better service and to preempt state airline and trucking regulations. See Rowe v. New Hampshire Motor Transp. Ass’n, 552 U.S. 364, 367-68, 371 (2008). Decisions interpreting the ADA’s preemption provision thus inform interpretations of the FAAAA’s preemption clause. See id. at 370.

There is, however, a presumption against preemption where a federal statute contains a provision preempting state law claims that relate to areas of traditional state regulation or police power. Lupian v. Joseph Cory Holdings LLC, 905 F.3d 127, 131 (3d Cir. 2018) (citing Bates v. Dow Agrosciences LLC, 544 U.S. 431, 449 (2005), and N.Y. State Conference of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 655 (1995)). To date, neither the Supreme Court nor the Tenth Circuit have addressed the specific issue whether the FAAAA preempts negligence or negligent-hiring claims in personal injury suits against brokers. See Lopez v. Amazon Logistics, Inc., 458 F.Supp.3d 505, 512 (N.D. Tex. 2020). Federal district courts have split both on the issue of whether negligent hiring claims against a broker are “related to” a broker’s services and on whether the safety exception applies to negligent hiring claims. See Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016, 1023 (9th Cir. 2020) (and cited cases). Only one circuit court – the Ninth Circuit – has yet to rule on these issues. See id. at 1020, 1023. Given the lack of binding Supreme Court or Tenth Circuit precedent on either issue, the Court will begin its analysis first with general Supreme Court and Tenth Circuit law and then consider whether this circuit is likely to follow the Ninth Circuit’s specific analysis of the issue.

a) Dixon’s negligent hiring claim against Ryan is “related to” broker services
*10 The term “related to” encompasses “state laws ‘having a connection with or reference to’ carrier ‘rates, routes, or services,’ whether directly or indirectly.” Dan’s City, 569 U.S. at 260 (quoting Rowe, 552 U.S. at 370). “[P]re-emption occurs at least where state laws have a ‘significant impact’ related to Congress’ deregulatory and pre-emption-related objectives.” Boyz Sanitation, 889 F.3d at 1198–99 (quoting Rowe, 552 U.S. at 371) (other citation omitted). Although the meaning of “related to” is broad, the sky is not the limit. Dan’s City, 569 U.S. at 260. Section 14501(c)(1) “does not preempt state laws affecting carrier prices, routes, and services in only a tenuous, remote, or peripheral … manner.” Id. at 261 (internal quotation marks omitted) (quoting Rowe, 552 U.S. at 371). Also “massively” limiting the scope of the FAAAA’s preemption provision is a phrase missing in the ADA — the addition of the words “with respect to the transportation of property.” Dan’s City, 569 U.S. at 261 (quotation omitted).

In Dan’s City, the Supreme Court concluded the FAAAA preemption provision did not apply to the plaintiff’s state law claims regarding the storage and disposal of the plaintiff’s car after the completion of a towing job because the claim did not involve “the transportation of property.” Id. at 261-62. The Supreme Court noted that the defendant’s transportation service in moving the car from the parking lot ended before the conduct upon which the plaintiff based his claims, which challenged the abandoned vehicle disposal regime. Id. at 262-63. By way of contrast, in Rowe, the Supreme Court held the FAAAA preempted two provisions of a State tobacco law that regulated the delivery of tobacco to customers within the State. Rowe, 552 U.S. at 367. In forbidding licensed tobacco retailers from using a delivery service unless the service followed specific delivery procedures, the state law created a direct “connection with” motor-carrier services and had a significant, adverse impact on what the federal law sought to avoid – “a State’s direct substitution of its own governmental commands for ‘competitive market forces’ in determining (to a significant degree) the services that motor carriers will provide.” Id. at 371-72.

Having considered cases on both sides of this preemption issue, the Court finds more persuasive the reasoning of the courts that have concluded that personal injury negligent hiring claims against brokers fall within the preemptive scope of 49 U.S.C. § 14501(c). In Miller v. C.H. Robinson Worldwide, Inc., the Ninth Circuit recently held that a negligent hiring claim brought against a broker “related to” broker services with respect to the transportation of property. Miller, 976 F.3d at 1024-25. The Miller court explained that the selection of motor carriers is one of the core services of brokers; and the negligent hiring claim interferes at the point where the broker arranges for transportation by a motor carrier. Id. at 1024. Consequently, the Ninth Circuit held that a negligent hiring claim against a broker is directly connected with broker services. Id.

Numerous other federal district courts have similarly concluded that a negligent hiring claim is directly “related to” the broker’s performance of this service with respect to the transportation of property because its services involve arranging for a motor carrier to transport property. See, e.g., Loyd v. Salazar, 416 F.Supp.3d 1290, 1297 (W.D. Okla. 2019) (collecting five district court cases reaching same result); Creagan v. Wal-Mart Trans., LLC, 354 F.Supp.3d 808, 813 (N.D. Ohio 2018) (on appeal) (“[B]ecause the negligent hiring claim seeks to enforce a duty of care related to how [the broker] arranged for a motor carrier to transport the shipment (the service), the claim falls squarely within the preemption of the FAAAA.”). See also Quinones v. Ladejo, 2021-Ohio-1988, __ N.E.3d __ (Ohio Ct. App.) (concluding that negligence claims against broker fell within the FAAAA’s preemption provision because of the “broad language employed in the general preemption provision, and because the negligence claim pertains to the selection of carriers, which is the core function of a broker by statutory definition”). Courts have pointed out that the term “brokerage service,” defined as “the arranging of transportation or the physical movement of a motor vehicle or of property,” 49 C.F.R. § 371.2(c), supports the conclusion that a negligent hiring claim directly implicates how a broker performs its central function of arranging for the transportation of property by hiring motor carriers. See, e.g., Gillum v. High Standard, LLC, Civil Action No. SA-19-CV-1378-XR, 2020 WL 444371, at *4-5 (W.D. Tex. Jan. 27, 2020) (citation and internal quotation marks omitted).

*11 The Court recognizes that other district courts have found no preemption because a negligent hiring action is too “tenuous, remote, or peripheral” from the “services” of a broker. See, e.g., Mann v. C.H. Robinson Worldwide, Inc., No. 7:16-cv-104, 2017 WL 3191516, at *7 (W.D. Va. July 27, 2017) (reasoning that negligent hiring claim against broker is general law aimed at all persons to act with reasonable care in making hiring decisions, as opposed to direct regulation of brokers that dictates specific way that they had to deliver products); Huffman v. Evans Transp. Services, Inc., Civil Action No. H-19-0705, 2019 WL 4143896 (S.D. Tex. Aug. 12, 2019). Yet, it is hard to see how a negligent hiring claim does not significantly affect a broker’s services. As the Gillum court convincingly explained, allowing such a claim to proceed would impose on brokers the duty to inspect a motor carrier’s background and investigate how a carrier selects and trains drivers. Gillum, 2020 WL 444371, at *6. Negligent hiring claims impose duties on brokers that would have a significant impact upon their ability to arrange for transportation of property, and thus, they are not the type of claims that have only a tenuous, remote connection to the services of the broker. Cf. Morales, 504 U.S. at 390 (concluding that state airline fare advertising guidelines were preempted by ADA because they imposed obligations that would have significant impact upon airlines’ ability to market their product, and hence significant impact upon the fares they charge).2 For all these reasons, the Court concludes that Dixon’s negligent hiring claim falls within the general preemption provision of the FAAAA.

b) FAAAA’s safety exception applies to Dixon’s negligent hiring claim against Ryan
The safety exception provides that the FAAAA preemption clause
shall not restrict the safety regulatory authority of a State with respect to motor vehicles, the authority of a State to impose highway route controls or limitations based on the size or weight of the motor vehicle or the hazardous nature of the cargo, or the authority of a State to regulate motor carriers with regard to minimum amounts of financial responsibility relating to insurance requirements and self-insurance authorization[.]
49 U.S.C. § 14501(c)(2)(A) (italics added). At issue here is the exception for “the safety regulatory authority of a State with respect to motor vehicles.” In determining whether a negligent hiring claim against a broker is saved from preemption, the Court must determine whether the common-law claim constitutes an exercise of a state’s “safety regulatory authority,” and whether the claim is “with respect to motor vehicles.” See Miller, 976 F.3d at 1026-31; Lopez, 458 F.Supp.3d at 515.

(1) “Safety regulatory authority of a State” encompasses common law claims
Some district courts limit “safety regulatory authority” to mean state regulations. Gillum, 2020 WL 444371, at *4-5 (quoting Huntington Operating Corp. v. Sybonney Express Inc., No. H-08-781, 2020 WL 1930087, at *3 (S.D. Tex. May 11, 2010)). Other courts – including the only federal circuit court to have ruled yet on the issue – have taken the opposite view and held that the phrase “safety regulatory authority” is not limited to state regulations and covers common-law tort claims. See Miller, 976 F.3d at 1026-29; Lopez, 2020 WL 2065624, at *6.

*12 “Congress’ clear purpose in § 14501(c)(2)(A) is to ensure that its preemption of States’ economic authority over motor carriers of property, § 14501(c)(1), ‘not restrict’ the preexisting and traditional state police power over safety.” City of Columbus v. Ours Garage and Wrecker Service, Inc., 536 U.S. 424, 439 (2002). The Ninth Circuit in Miller relied in large part on the Supreme Court’s decision in Ours Garage. Miller, 976 F.3d at 1026-30. In Ours Garage, the Supreme Court rejected the narrowest possible construction of the safety exception to only cover the regulatory authority of the State by reading the exception to exempt the safety regulatory authority of municipalities. See Ours Garage, 536 U.S. at 440-42. Examining the legislative history of the statute, the Supreme Court noted that a key interest group, the American Trucking Association, endorsed the statute and its deregulatory aim subject to conditions that allowed regulatory protection for safety. See id. at 440-41.

The Ninth Circuit likewise found significant that Congress passed the FAAAA primarily to prevent States from regulating economic aspects of the trucking industry. Miller, 976 F.3d at 1026. The Miller court construed the reference to “safety regulatory authority of a State” broadly and explained that common law liability historically was a way in which the State regulated safety. Miller, 976 F.3d at 1026. Further, the Court noted that some States codify their common law, so it seems unlikely that Congress made the exception available to only those codifying States, given its goal of uniformity. Id. at 1027. Finally, the Ninth Circuit relied on the presumption that when the text of a preemption clause is susceptible of more than one plausible reading, courts should accept the reading that disfavors preemption because it is consistent with both federalism principles and the historic primary role of the states in regulating health and safety. Id. at 1027-28.

The Court finds the Ninth Circuit’s reasoning persuasive. The phrase “safety regulatory authority of a State” is not clear as to Congress’s intent. It is not defined in the Act. Id. at 1026. While the term “regulation” arguably could be limited to state regulations, Congress used the phrase “regulatory authority,” despite having used the term “regulation” in other provisions of the Act. Lopez, 458 F.Supp.3d at 515. Moreover, common law liability has historically “formed the bedrock of state regulation, and common law tort claims have been described as ‘a critical component of the States’ traditional ability to protect the health and safety of their citizens.’ ” Desiano v. Warner-Lambert & Co., 467 F.3d 85, 86 (2d Cir. 2006) (quoting Cipollone v. Liggett Group, Inc., 505 U.S. 504, 544 (1992) (Blackmun, J., concurring in part and dissenting in part)). Therefore, a reasonable interpretation of “safety regulatory authority of a State” is that it encompasses state common law claims. See Miller, 976 F.3d at 1026; Lopez, 458 F.Supp.3d at 515 (viewing as “nondeterminative” the fact that “the enforcement mechanism is private action” because “state common law claims exist by force of state authority”); Morales v. Redco Transp. Ltd., Case No. 5:14-cv-129, 2015 WL 9274068, at *3 (S.D. Tex. Dec. 21, 2015) (“negligence claims can certainly fall within states’ regulatory authority, because negligence is the common-law regulation of misconduct”); Quinones, 2021-Ohio-1988, ¶¶ 18-21 (adopting Miller court’s reasoning).3

*13 According to the Tenth Circuit, if a statute is ambiguous, courts turn to legislative history and the underlying public policy of the statute. Boyz Sanitation, 889 F.3d at 1199. As the Supreme Court and Ninth Circuit explained, aspects of the legislative history indicate that Congress intended preemption of state economic regulation, not safety, justifying a broader reading of the safety exception. See Ours Garage, 536 U.S. at 440-41; Miller, 976 F.3d at 1026. According to a House Conference Report, one of Congress’ findings regarding the preemption provision of intrastate transportation of property is that “certain aspects of the State regulatory process should be preempted.” H.R. Rep. No. 103-677, at 39 (1994) (Conf. Rep.). The preemption provision for both intrastate and interstate transportation uses broad language that covers common law. See 49 U.S.C. § 41713(b) (“49 U.S.C. 14501(b) (“a State … may not enact or enforce a law, regulation, or other provision having the force and effect of law”); 49 U.S.C. § 14501(b) (preempting State “law, rule, regulation, standard, or other provision having the force and effect of law”); id. § 14501(c) (“law, regulation, or other provision having the force and effect of law”). That the House Report used the term “State regulatory process” to describe preempted laws, regulations, and common law lends further support to a similarly broad construction of “regulatory authority of a State” to include common law claims.

Moreover, the Fifth Circuit in the related context of the ADA found significant the lack of legislative history indicating Congress intended to displace application of state tort law to personal physical injury caused by aircraft operations and the failure to provide a federal remedy for such injured persons. See Hodges v. Delta Airlines, Inc., 44 F.3d 334, 338 (5th Cir. 1995). More recently, the Fifth Circuit has continued to construe the safety exception broadly. See VRC LLC v. City of Dallas, 460 F.3d 607, 612 (5th Cir. 2006) (“Case law both predating and applying the principles discussed in Ours Garage has on the whole given a broad construction to the safety regulation exception.”).

“In areas of traditional state regulation, we assume that a federal statute has not supplanted state law unless Congress has made such an intention clear and manifest.” Bates, 544 U.S. at 449 (internal quotations omitted). “Congress’ clear purpose in § 14501(c)(2)(A) is to ensure that its preemption of States’ economic authority over motor carriers of property, § 14501(c)(1), ‘not restrict’ the preexisting and traditional state police power over safety.” Id. at 439. It is not clear that the FAAAA sought to supplant state common law torts related to public safety. Cf. Ours Garage, 536 U.S. at 434 (concluding that FAAAA does not provide requisite “clear and manifest indication that Congress sought to supplant local authority,” despite disparate inclusion and exclusion of words “political subdivisions”). “If Congress had intended to deprive injured parties of a long available form of compensation, it surely would have expressed that intent more clearly.” Bates, 544 U.S. at 449.

In summary, the Court agrees with the Ninth Circuit’s reasoning that the legislative history and public policy of the FAAAA supports a broader interpretation of the safety exclusion to save certain common law torts from preemption. The presumption against preemption also applies where, as here, the statutory language is ambiguous. In keeping with federalist principles, the safety exclusion should be broadly interpreted to retain the States’ historic role over safety.

(2) Phrase “with respect to motor vehicles” is broad and covers negligent hiring claims against a broker
The next question is whether a negligent hiring claim against a broker that serves to protect the motoring public by discouraging the unsafe selection of motor carriers is a claim “with respect to motor vehicles.” Some courts have said, no, interpreting this phrase to more narrowly require that the law in question be a regulation of a motor vehicle or that the defendant have control over a regulated motor vehicle for the exception to apply. See, e.g., Creagan, 354 F.Supp.3d at 814 (concluding that negligent hiring claim against broker was not within safety exception because claim imposes duty on service of broker and does not regulate motor vehicles); Gillum, 2020 WL 444371, at *4 (deciding safety exception did not apply to negligent hiring claims because “the FAAAA preemption provision applies broadly to any ‘law, regulation, or other provision having the force and effect of law,’ whereas the carve-out provision applies more narrowly to the ‘safety regulatory authority’ of a state with respect to motor vehicles”); Volkova v. C.H. Robinson Co., No. 16 C 1883, 2018 WL 741441, at *4 (N.D. Ill. Feb. 7, 2018) (rejecting argument “that a state common law claim for negligent hiring constitutes a safety regulation of a motor vehicle”). These courts rejected a broad interpretation as contrary to Congress’ intent in providing specific exceptions to federal preemption. See Loyd, 416 F.Supp.3d at 1299-1300 (concluding that negligent hiring or brokering claims concern motor carriers, with only indirect concern for safety of motor vehicles, and thus, such claims are not saved by the safety exception).

*14 The Supreme Court defined the phrase “with respect to” in the FAAAA clause “with respect to the transportation of property” to mean “concern[s].” See Dan’s City, 569 U.S. at 261. Congress, by choosing a phrase meaning “concerns,” intended a broad reading of “with respect to motor vehicles” to include direct or indirect connections. See id. at 260-61; Miller, 976 F.3d at 1030; Quinones, 2021-Ohio-1988, ¶¶ 20-21. The Fifth Circuit has also indicated support for a broader interpretation of the safety exception, observing that the term “motor vehicle safety,” defined in the “Motor Vehicle Safety” chapter of Title 49, is “obviously narrower than the term ‘safety regulatory authority of a State with respect to motor vehicles’ ” used in section 14501(c)(2)(A). Cole v. City of Dallas, 314 F.3d 730, 733 (5th Cir. 2002) (declining “to elasticize Congress’s economic goal by narrowly interpreting ‘safety regulatory authority of a State with respect to motor vehicles’ ” and finding that city’s criminal history regulations for wrecker drivers were not preempted). Negligent hiring claims against a broker indirectly concern motor vehicles because they encourage the selection of safe and competent motor carriers to prevent injuries caused by motor vehicles. See Miller, 976 F.3d at 1030-31 (negligence claims against brokers sufficiently connected to motor vehicles for safety exception to apply to claims); Taylor v. Sethmar Transp., Inc., Civil Action No. 2:19-cv-00770, 2021 WL 4751419, at *15-16 (S.D. West Virginia Oct. 12, 2021) (concluding that “with respect to motor vehicles” encompasses indirect safety regulations of motor vehicles, like negligent selection claims that incentivize brokers to select safe and competent motor carriers to drive motor vehicles in the state); Lopez, 458 F.Supp.3d at 516 (determining “that a claim seeking damages for personal injury against a broker for negligently placing an unsafe carrier on the highways is a claim that concerns motor vehicles and their safe operation”); Finley v. Dyer, NO. 3:18-CV-78-DMB-JMV, 2018 WL 5284616 at *6 (N.D. Miss. Oct. 24, 2018) (concluding that negligent hiring claims against brokers are centered on brokers’ efforts to place trailers on highways, and thus, concern motor vehicles so as to fall under safety exemption provision).

For the same reasons the Court finds it more persuasive to interpret the “safety regulatory authority of a State” broadly, the Court likewise concludes that “with respect to motor vehicles” should be read broadly. Again, the legislative history and public policy of the FAAAA, as well as federalist principles, support a broader interpretation of the safety exclusion that retains the States’ traditional role over public safety, and the presumption against preemption should apply when the statutory language is ambiguous. Accordingly, Plaintiff’s negligent hiring claim against Ryan falls within the safety regulatory authority of the State with respect to motor vehicles and is therefore not preempted by the FAAAA. Consequently, permitting Plaintiff to amend his complaint to add the claim would not be futile.

3) The TAC states a plausible negligence claim against Ryan based on vicarious liability as a statutory employee and under agency theory
In the FAC, Plaintiff asserted vicarious liability against Ryan as a motor carrier and statutory employer of Stone Truck and Tawil and as the principal with a right to control its agent, Tawil, under agency principles and the doctrine of respondeat superior. (See FAC ¶¶ 66-77, ECF No. 20.) The TAC asserts that Ryan held itself out as a “carrier” based on the bill of lading and that it legally and contractually bound itself to transport the shipment and accepted responsibility for the shipment. (TAC ¶¶ 20, 23, 50, ECF No. 69 at 28-29, 40 of 70.) Despite similar language in the SAC, the Court concluded in its order that, based on the record, Plaintiff had not shown that the proposed second amended complaint would not be futile. (See Mem. Op. and Order 32-37, ECF No. 57). The Court explained that the contract was signed subject to the Broker Addendum, the terms of which expressly and clearly stated that it controlled in the event of any conflicting terms contained in the Contract. (Id. at 34.) The Court found that the Broker Addendum unambiguously stated that Ryan held itself out to be a broker and that reference to Ryan as a “Carrier” in the Contract was strictly for the parties’ convenience and did not create or imply a holding out or assumption by Ryan of motor carrier authority….” (Id. at 34-35 (quoting Broker Addendum, ECF No. 48-1 at 31 of 31).)

Plaintiff argues that the Court erred in its analysis because it failed to consider terms of the Contract that inject ambiguity as to whether the Contract or the Broker Addendum controls. Plaintiff also asserts that the Court should reconsider its ruling because the TAC asserts facts that the Broker Addendum was not valid. In the TAC, Plaintiff alleges that the Agreement between Ryan and Russell Stover gave Ryan exclusive control of the persons operating the equipment or otherwise engaged in transportation services; Ryan legally and contractually controlled and accepted responsibility for the shipment; the Broker Addendum was not part of the Agreement and was not referenced in the Agreement; the Broker Addendum was expressly omitted pursuant to Paragraphs 27(a), 27(b), 27(d), and 38 of the Agreement; the Broker Addendum was not signed by Russell Stover’s Director of Transportation; and the Broker Addendum did not expressly exclude or control over the express language of the Agreement. (See TAC ¶¶ 23, 47, 51, ECF No. 69 at 30, 37-38, 41 of 70.) The TAC states that the Contract in paragraphs 3(a) and 3(b) establishes that Ryan was the motor carrier and accepted the shipment in that capacity. (Id. ¶ 50, ECF No. 69 at 41 of 70.) Plaintiff also alleges that Ryan had exclusive control of the driver and motor vehicle by contract and assumed full responsibility for the shipment, and that Ryan certified in the Bill of Lading that it was functioning as the carrier. (Id. ¶¶ 20, 28, ECF No. 69 at 28, 31 of 70.)

*15 According to the TAC, paragraph 27 of the Contract provides:
ENTIRE AGREEMENT; MODIFICATION; WAIVER; CONTROLLING DOCUMENTS,
(a) This Contract and the Appendices A,B,C, attached hereto, constitute the entire agreement between the parties with respect to the subject matter hereof, and all previous communications, statements and instruments are hereby withdrawn and annulled.
(b) This Contract may not be changed, or modified in any manner except by an instrument in writing signed on behalf of each of the parties hereto by their duly authorized representatives….
(d) The terms of this Contract and Appendices shall control over any other document attached hereto or incorporated by reference. Notwithstanding anything to the contrary contained in Appendix E, the terms and conditions of this Contract shall supersede any inconsistent terms and conditions in any bill of lading or other shipping document, tariff, service guide, or similar document.
(TAC ¶ 51, ECF No. 69 at 42 of 70 (bold emphasis removed).) Plaintiff alleges, in the absence of contrary evidence, that the Broker Addendum was signed before or at the same as the Contract, and thus paragraph 27(a) annuls and renders unenforceable the Broker Addendum. (Id. at 42 of 70.)4 Plaintiff further asserts, in the absence of contrary evidence, that the Broker Addendum was not signed by duly authorized representatives, and it is unenforceable based on paragraph 27(b); the Broker Addendum does not apply to Russell Stover because it is not named therein; it is not genuine; and paragraph 27(d) of the Contract renders the terms of the Broker Addendum unenforceable, or at least ambiguous. (Id. at 42-43 of 70.)

Having reviewed the contractual provisions Plaintiff set forth in the TAC, the Court finds good grounds to reconsider its prior ruling that the Broker Addendum was clear, unambiguous, and controlling as a matter of law. Paragraph 27(d)’s express declaration that “terms of this Contract and Appendices shall control over any other document attached hereto or incorporated by reference” injects uncertainty as to whether the Contract controls over the Broker Addendum or vice versa. Moreover, according to the facts of the TAC, the Broker Addendum may not be valid, depending on the time it was signed by the parties and who signed it. Plaintiff in the TAC plausibly stated facts which, if true, suggest that the Broker Addendum does not control. Cf. Jones v. D’Souza, No. 7:06CV00547, 2007 WL 2688332, at *2-3 (W.D. Va. Sept. 11, 2007) (concluding that plaintiff’s negligence claim against broker based on theory of vicarious liability was sufficient to survive motion to dismiss, despite that contract between broker and motor carrier stated that motor carrier was independent contractor, because plaintiff disputed authenticity of agreement). Consequently, the Court must consider what this conclusion means for Plaintiff’s vicarious liability claims against Ryan.

a) Plaintiff states a plausible claim against Ryan based on theory it had a non-delegable duty because it was a “motor carrier”
*16 Under New Mexico law, generally “an employer of an independent contractor is not responsible for the negligence of the contractor or his employees.” Saiz v. Belen Sch. Dist., 1992-NMSC-018, ¶ 10, 113 N.M. 387. An employer has no right to control the manner in which an independent contractor works, unlike an employee for whose negligence the employer is vicariously liable. Id. One exception to the independent contractor general rule is when the independent contractor has a non-delegable duty to protect another from harm based on a duty imposed by statute. See Harris v. FedEx Nat. LTL, Inc., 760 F.3d 780, 783-84 (8th Cir. 2014) (citing Nebraska law); Saiz, 1992-NMSC-018, ¶ 10 (“The general rule has no application where the employer has nondelegable duties (1) arising out of some relation toward the public or the particular plaintiff (e.g., duty of lessor to lessee), or (2) because of work that is specially, peculiarly, or inherently dangerous.”).

According to 49 C.F.R. § 390.11, motor carriers must “require observance of” the duties or prohibitions imposed on drivers by the FMCSR. 49 C.F.R. § 390.11. Thus, an “interstate carrier is vicariously liable as a matter of law under the FMCSR for the negligence of its statutory employee drivers.” Morris v. JTM Materials, Inc., 78 S.W.3d 28, 39 (Tex. Ct. App. 2002) (citing, among others, Rodriguez v. Ager, 705 F.2d 1229, 1233-36 (10th Cir. 1983)). The question here is whether the allegations plausibly establish Ryan was acting as a motor carrier in this transaction, not a broker.

In Essex Insurance Company v. Barrett Moving & Storage, Inc., 885 F.3d 1292 (11th Cir. 2018), a cargo loss case, the Eleventh Circuit considered whether the defendant was a broker or liable for the damaged goods as a motor carrier. See id. at 1295-96. Relying on Department of Transportation regulations, the Eleventh Circuit reasoned:
Broker means a person who, for compensation, arranges, or offers to arrange, the transportation of property by an authorized motor carrier. Motor carriers, or persons who are employees or bona fide agents of carriers, are not brokers within the meaning of this section when they arrange or offer to arrange the transportation of shipments which they are authorized to transport and which they have accepted and legally bound themselves to transport.
Id. at 1300-01 (quoting 49 C.F.R. § 371.2(a)) (italics added by Eleventh Circuit). The key question is whether the entity accepted legal responsibility to transport the shipment. Id. at 1301. If a party makes it clear in writing that it is merely acting as a go-between to connect the shipper with a third-party carrier, it will be considered a broker, but when no writing exists, “the question will depend on how the party held itself out to the world, the nature of the party’s communications and prior dealings with the shipper, and the parties’ understanding as to who would assume responsibility for the delivery of the shipment in question.” Id. at 1302. This analysis is case-specific. Id.

Because the Court now finds ambiguity exists as to whether the Broker Addendum controls, it is not certain as a matter of law whether Ryan insulated itself from liability for this shipment by making “clear in writing that it is merely acting as a go-between to connect the shipper with a suitable third-party carrier.” See Essex, 885 F.3d at 1302. The TAC alleges that Ryan accepted responsibility for the shipment, and thus, it is plausible that Ryan acted as a motor carrier in this transaction. See Tryg Insurance v. C.H. Robinson Worldwide, Inc., 767 F. App’x 284, 287 (3d Cir. Apr. 19, 2019) (unpublished) (“If an entity accepts responsibility for ensuring the delivery of goods, then that entity qualifies as a carrier regardless of whether it conducted the physical transportation.”).

*17 Moreover, the way the parties characterized their own relationship, while evidence, is not necessarily dispositive if there is evidence of the traditional elements of agency. See Harris, 760 F.3d at 783 (“Whether a truck driver is acting as an employee or as an independent contractor depends on the facts underlying the relationship of the parties irrespective of the words or terminology used by the parties to characterize and describe their relationship.”) (internal quotations omitted); Jett v. Van Eerden Trucking Co., Inc., No. CIV-10-1073-HE, 2012 WL 37504, at *3-4 (W.D. Okla. Jan. 9, 2012) (noting that way owner of trailer and motor carrier characterized relationship does not end issue of vicarious liability because “the substance of the relationship would ultimately control”). Turning then to other facts in the TAC about the relationship between Ryan and the driver, Tawil, Plaintiff alleges that Ryan represented itself in portions of the contract and in the bill of lading as the carrier and controlled the manner of work performance – Ryan provided the schedule, logistics, mandatory documentation, tracking, and in-service communications en route. (See TAC ¶¶ 46-47, ECF No. 69 at 36-37 of 70.) These allegations indicate that Ryan arranged the transportation for the goods that it accepted and legally bound itself to transport and, thus, show a plausible claim of vicarious liability against Ryan. Accordingly, permitting amendment of a negligence claim against Ryan would not be futile. Cf. Ciotola v. Star Transp. & Trucking, LLC, 481 F.Supp.3d 375, 393 (M.D. Penn. 2020) (denying summary judgment to defendant who argued it was broker, not motor carrier, where some facts suggested it was motor carrier, such as directly communicating with driver, driver signing bill of lading as agent of defendant, and shipper only receiving communication from defendant for tracking shipment, even though some contrary facts suggested defendant only acted as broker); Richwell Grp., Inc. v. Seneca Logistics Grp., LLC, 425 F.Supp.3d 57, 61-62 (D. Mass. 2019) (concluding that defendant took on role of carrier in specific transaction by accepting responsibility for transport of goods, despite fact that contract said defendant would contract directly with a carrier); Courtney v. Ivanov, Civil Action No. 3:13-227, 2015 WL 3866674, at *4-6 (W.D. Penn. June 23, 2015) (denying motion to dismiss negligence claim based on non-delegable duty against entity that plaintiff alleged was a broker, because status is determined by relationship between parties and complaint also alleged that entity acted as motor carrier with respect to shipment and assumed legal duty to transport load in safe manner; thus, issue was one of fact to be tested and developed during course of discovery).

b) TAC states plausible claim that Ryan acted as Tawil’s employer under common law agency theory
“New Mexico courts have employed an agency analysis to determine whether an individual is acting as an independent contractor or as an employee.” Celaya v. Hall, 2004-NMSC-005, ¶ 11, 135 N.M. 115. In New Mexico, a “right to control analysis focuses on whether the principal exercised sufficient control over the agent to hold the principal liable for the acts of the agent,” and where a sufficient right to control is present, “an employer-employee relationship usually exists.” Id. ¶ 12. “The principal test is whether the employer has the right to control the manner in which the details of the work are to be accomplished, not the exercise of any control at all.” Scott v. Murphy, 1968-NMSC-185, ¶ 10, 79 N.M. 697. When the right to control is not fundamentally a part of the relationship, a court may consider a number of factors when determining whether an individual is acting as an employee or independent contractor: (1) the degree of control the principal exercises over the details of the agent’s work, (2) the type of occupation and whether it is usually performed without supervision; (3) the skill required for the job; (4) whether the employer supplies the instrumentalities or tools for the person doing the work; (5) the length of time the person is employed; (6) the method of payment, whether by time or job; (7) whether the work is part of the regular business of the employer; (8) whether the parties intended to create an employment relationship; and (9) whether the principal is engaged in business. See Loya v. Gutierrez, 2015-NMSC-017, ¶¶ 55-56, 350 P.3d 1155; Celaya, 2004-NMSC-005, ¶ 15 (citing Restatement (Second) of Agency § 220(2)(a-j)).

As aforementioned, the TAC alleges that Ryan controlled the manner of work performance, such as by providing the schedule, logistics, mandatory documentation, tracking, and in-service communications en route. (See TAC ¶¶ 46-47, ECF No. 69 at 36-37 of 70.) Unlike the SAC, these new allegations indicate that Ryan may have maintained control over the means and methods of transportation, including the performance of the driver. The TAC thus plausibly states a claim for vicarious liability against Ryan based on an agency theory. Cf. Riley, 2017 WL 2501138, at *8 (concluding that genuine factual dispute existed on extent to which defendant had right to control details of motor carrier’s delivery of load, and thus, factual question of whether agency relationship existed between defendant, the purported broker, and motor carrier at time of collision precluded summary judgment on vicarious liability theory against defendant); Sperl v. C.H. Robinson Worldwide, Inc., 946 N.E.2d 463, 467, 471-72 (Ill. App. Ct. 2011) (concluding that jury’s decision imposing liability for damages caused by tractor-trailer crash on freight broker was not against weight of evidence, because evidence showed broker controlled driver’s work by specifying trailer length, specifying refrigerated trailer, dictating special instructions for load – pick up load at specified time, make daily check calls, and stay in constant communication with dispatchers – and imposing schedule backed by fines that pressured driver to violate federal regulations).

*18 The determination of whether an entity was a carrier or broker or whether the driver was an employee or independent contractor of an entity are fact-specific inquiries. Because Plaintiff has alleged enough facts in the TAC to show plausibility, the Court will permit the negligence claim against Ryan on a vicarious liability theory to move forward for further development of the factual record.

b. The proposed complaint states a negligence claim against Russell Stover
As an initial matter, Russell Stover argues that claim preclusion bars re-litigation of these issues. The Court, however, does not find res judicata principles apt here where this case has not gone to final judgment and Plaintiff moved the Court to reconsider its decision in the same case. The federal rules permit both motions to amend and motions to reconsider, and the Court will apply the standards for those motions, rather than the doctrines of res judicata or claim preclusion.

1) The TAC states a plausible direct negligence claim against Russell Stover based on negligent hiring and unsafe scheduling
Plaintiff alleges that Russell Stover is directly negligent for his injuries because it demanded a time-is-of-the-essence contract from Stone Truck and Tawil, requiring the shipment be picked up at 1300 hours on October 27, 2018 in Corsicana, Texas, and delivered by 900 hours on October 30, 2018, in Watsonville, California. (TAC ¶ 52, ECF 69 at 44 of 70.) Plaintiff asserts that Russell Stover “unsafely scheduled the trip with a pick-up and delivery requirement which could not reasonably be accomplished without violating the hours-of-service laws of the Federal Motor Carrier Safety Act while driving in accordance with driving laws.” (TAC ¶ 53, ECF No. 69 at 44-45 of 70.) Additionally, according to the TAC, Russell Stover retained the right to control how Ryan and Stone Truck completed their tasks, including selecting the trucking company and driver, dispatching the carrier or its driver directly, requiring the use of specific equipment, advancing a method to discount the cost of fuel, and reserving the right to reduce compensation for shipment delays. (Id.) Plaintiff alleges that Russell Stover knew or should have known that Stone Truck and Tawil were not properly qualified and selected. (Id.)

Russell Stover notes that in the prior round of briefing, Plaintiff asserted in his response to Ryan’s motion to dismiss that the agreement between Ryan and Stone Truck “provides that Defendant Stone ‘shall employ team drivers’ where necessary.” (Pl.’s Resp. 19, ECF No. 24 (citing Def. Ryan’s Ex. 1, ECF No. 31-1).) Indeed, the Contract between Ryan and Stone Truck, previously made part of the record, provides that the “parties acknowledge that time is of the essence in the transportation of cargo under this Agreement and that monetary damages may accrue if the goods are not delivered within the time frame(s) specified in the rate confirmation, bill of lading or other shipping directives.” (Broker-Contract Carrier Agreement ¶ 9, ECF No. 31-1.) In that same paragraph, the contract stated:
Nothing in this Agreement shall be construed as requesting or requiring CARRIER to violate the federal safety regulations regarding hours of service set forth at 49 C.F.R. § 395 and/or applicable State regulations. Where CARRIER makes pick-up and delivery commitments to BROKER, BROKER reasonably relies on CARRIER’s knowledge and expertise that such transit time is consistent with the safety regulations. Where necessary CARRIER shall employ team drivers and use all other reasonable means to meet its commitments without additional cost to BROKER.
*19 (Id. (emphasis added).) Because the Contract required the use of “team drivers” when necessary, Russell Stover argues that team drivers “would have prevented driving excessive hours or overtiredness or other similar driver impairment alleged by Dixon.” (Def. Russell Stover’s Resp. 13, ECF No. 73.)

The Court finds that Plaintiff’s allegations in the TAC concerning a negligence theory based on requiring a route that would reasonably require hours-of-service laws to be broken to be a plausible claim of liability, given that Tawil is alleged to have impaired alertness when he caused the collision. While Russell Stover’s team-driving argument may ultimately provide a defense to the negligent scheduling theory of liability, the Court does not have the record before it to determine that defense as a matter of law. For example, the federal hours-of-service laws are not cited in the record, and this issue may involve factual questions such as what the parties would have anticipated the total hours of driving to be with a single driver versus a team of drivers, or what the standards are in the industry concerning team drivers. Determining the merits of the team-driver defense is best left on a fully developed summary judgment record. See Edwards v. City of Goldsboro, 178 F.3d 231, 243 (4th Cir. 1999) (explaining that Rule 12(b)(6) motion tests sufficiency of complaint but “does not resolve contests surrounding the facts, the merits of a claim, or the applicability of defenses”). Allowing an amendment to add a negligent scheduling claim is not clearly futile.

Regarding the negligent-hiring claim, Russell Stover asserts that the non-conclusory allegations and the documents upon which Plaintiff’s factual assertions are based show that Russell Stover contracted with Ryan only, not with Stone Truck or Tawil. Accordingly, Russell Stover contends that the new factual allegations about Tawil’s citation history and Stone Truck’s safety rating do not bear on Russell Stover’s liability because no evidence or non-conclusory facts show that Russell Stover hired either of them. In the TAC, Plaintiff alleges that Russell Stover arranged the shipment by hiring Ryan and Stone Truck to perform its duties as a motor carrier. (TAC ¶ 15, ECF No. 69 at 27 of 70.) Other allegations indicate that Ryan arranged for Stone Truck and Tawil to transport the shipment of Russell Stover’s goods, which Ryan legally and contractually bound itself to transport. (See id. ¶ 20, ECF No. 69 at 28 of 70. See also TAC ¶ 8, ECF No. 69 at 26 of 70 (stating that Stone Truck hauled Russell Stover’s cargo “under the contractual exclusive direction and control of Defendant Ryan Transportation and under the statutory direction and control of all Defendants” pursuant to the FMCSA; id. ¶ 46, ECF No. 69 at 36-37 of 70 (asserting Ryan “was negligent in the selection of Defendant Stone Truck Line” and “by Agreement the transportation of the subject shipment was under the exclusive control of Defendant Ryan Transportation”).)

Paragraph 11 of the Contract between Russell Stover and Ryan states: “CARRIER, if not preapproved by SHIPPER as a ‘BROKER’ shall utilize no other carriers without the prior consent of SHIPPER.” (Contract, ECF No. 48-1 at 23 of 31 (italics added).) As discussed supra, the Court finds ambiguities in the Contract exist as to whether the terms of the Contract or Broker Addendum control, and Plaintiff has alleged facts indicating that the Broker Addendum may not be valid. There are therefore some factual allegations indicating that Russell Stover may have approved the selection of Stone Truck, and thus, Plaintiff’s assertion that Russell Stover selected Stone Truck is plausible.

2) The TAC states a plausible negligence claim against Russell Stover based on vicarious liability under an agency theory
*20 In this Court’s prior Memorandum Opinion and Order, the Court ruled that Russell Stover was not acting as a motor carrier or a statutory employer of Tawil as a matter of law because, according to the allegations of the complaint, it was acting as a shipper in this particular transaction and hired Ryan to arrange for the shipment of its goods. (See Mem. Op. and Order 27, ECF No. 57.) Plaintiff asks the Court to reconsider this ruling, because according to the TAC, Russell Stover is an experienced, knowledgeable, licensed motor carrier who retained the right to control how Ryan and Stone Truck completed their tasks. (TAC, ¶¶ 53, 90, ECF No. 69 at 45, 60-61 of 70.) In addition, Plaintiff asserts that Russell Stover is the statutory employer of Tawil and liable for his acts. (Id.) Russell Stover argues that these new allegations are speculative, hoped-for conclusions, and that they do not establish that it acted as a motor carrier in this transaction as a matter of law.

a) Russell Stover did not have a non-delegable duty as a “motor carrier”
As discussed supra, an exception to the general rule that one who employs an independent contractor is not liable for harm caused by the contractor’s employees is if the employer has a nondelegable duty imposed by statute to protect another from harm. Harris, 760 F.3d at 783-84. To the extent Plaintiff’s vicarious liability theory is based on Russell Stover acting as a motor carrier in this transaction, the Court rejects this theory as a matter of law based on the regulatory definitions of motor carrier, broker, and shipper. In 49 C.F.R. § 390.11, the FMCSR imposes the duties of drivers onto motor carriers. See Harris, 760 F.3d at 784. Entities may constitute motor carriers “when they arrange or offer to arrange the transportation of shipments which they are authorized to transport and which they have accepted and legally bound themselves to transport.” 49 C.F.R. § 371.2.

Plaintiff alleges that Russell Stover is the shipper of the chocolate cargo, and that it arranged the transport of the shipment by hiring Ryan and Stone Truck Line to perform its duties as a motor carrier as its agents with the objective of transporting its goods for compensation paid by Russell Stover. (TAC ¶ 15, ECF No. 69 at 27 of 70.) While Russell Stover could have transported its shipment as the motor carrier, the contract with Ryan shows that it did not accept and legally bind itself to transport its own goods, and Russell Stover was thus acting as the shipper in this transaction, not a motor carrier. Cf. Harris, 760 F.3d at 784-85 (affirming summary judgment for FedEx on non-delegable duty theory of liability because FedEx acted as shipper in specific transaction at issue where it purchased transportation services of carrier); Lyons v. Lancer Ins. Co., 681 F.3d 50, 59 (2d Cir. 2012) (“The shipper is the entity that purchases the transportation services of the carrier.”). The Court therefore finds that adding a theory of liability based on Russell Stover being the statutory employer of Tawil based on the FMCSA and FMCSR would be futile.

b) The TAC plausibly states a claim against Russell Stover under common law agency theory
Plaintiff, however, also asserts in the TAC additional facts that Russell Stover, even if acting as the shipper, retained a right to control the manner in which Tawil transported the shipment such that it should be held liable for the acts of its agent, Tawil. This agency theory, while related to the non-delegable duty/statutory employer theory, is distinct. The non-delegable duty theory focuses on the meaning of “motor carrier” in the federal regulatory scheme, whereas the agency theory focuses on the degree of control an entity has over the driver under applicable state law. See Crocker v. Morales-Santana, 2014 ND 182, ¶¶ 28-29, 854 N.W.2d 663 (separately analyzing theories of statutory employee doctrine and right-to-control theory of liability). As discussed above, the key question on an agency theory is whether Plaintiff alleged sufficient facts to plausibly show that Russell Stover exercised sufficient control over Tawil to hold it liable for his acts. See Celaya, 2004-NMSC-005, ¶¶ 11-12; Crocker, 2014 ND 182, ¶ 31 (explaining that liability under Restatement (Second) of Torts § 414 occurs only where employer controls method, manner, and operative details of independent contractor’s work such that “the contractor is not entirely free to do the work in his own way”) (quoting Fleck v. ANG Coal Gasification Co., 522 N.W.2d 445, 448 (N.D. 1994)).

*21 Plaintiff asserts in the TAC that Russell Stover retained control over the method, manner, and operative details of Tawil’s works by selecting the trucking company and driver, dictating the delivery timeline, dispatching the carrier or its driver directly, dictating the transportation route by providing a discounted method for the cost of fuel, and requiring the use of specific equipment, such as the type of trailer, communication system, and GPS tracking system, among other things. (TAC, ¶¶ 53, 90, ECF No. 69 at 45, 60-61 of 70.) As with Ryan, these allegations, which the Court must assume are true at this stage, plausibly suggest that Russell Stover may have controlled the method, manner, and details of Tawil’s work such that he was not entirely free to do the work his own way. Whether the evidence will ultimately support Plaintiff’s claims is a decision better left for the fact finder or on summary judgment. Crawford-El v. Britton, 523 U.S. 574, 600 (1998) (“summary judgment serves as the ultimate screen to weed out truly insubstantial lawsuits prior to trial”).

c. The TAC does not plausibly state a claim under a joint enterprise theory
Plaintiff alleges that Russell Stover, Ryan, and Stone Truck pooled their resources and efforts to accomplish the goal of using a truck and driver to transport Russell Stover’s goods, and that they each were authorized to control the performance of the shipment because they all qualified as motor carriers. (TAC ¶¶ 54, 100-103, ECF No. 69 at 46, 66-67 of 70.) Further, the TAC states that these three entities shared in any profits or losses from the delivery of the shipment and were members of a joint enterprise, and thus, Ryan and Russell Stover are vicariously liable for Stone Truck’s and Tawil’s acts or omissions. (Id. ¶¶ 54, 104-07)

Under New Mexico law, a party may be liable for the negligence of its joint venturers. See Schall v. Mondragon, 1964-NMSC-107, 74 N.M. 348 (“If two or more persons unite in a joint prosecution of a common purpose, under such circumstances that each has the authority to control the means employed to execute such purpose, the negligence of one is chargeable to the other….”). “A joint venture is formed when the parties agree to combine their money, property or time for conducting a particular business venture and agree to share jointly in profits and losses, with the right of mutual control over the business enterprise or over the property.” Quirico v. Lopez, 1987-NMSC-070, ¶ 9, 106 N.M. 169. Russell Stover argues that Plaintiff does not allege in the TAC any right of mutual control over the business enterprise or over the property. Moreover, it asserts that the allegation that they share in profits or losses from delivery of the shipment is sheer speculation not based on any contract with a profit/loss provision. It further contends that the Bill of Lading belies any sharing of losses or profits, as it states that Stone Truck agreed to hold Ryan and its customer harmless for any loss or damage to cargo and from all and any liability arising from Stone Truck’s operations. (See Def. Russell Stover’s Resp. 21, ECF No. 73 (quoting ECF No. 31-3 at 2).)

In the TAC, Plaintiff alleges that Russell Stover, Ryan, and Stone Truck “collectively pooled their resources, efforts, and knowledge to accomplish their common purpose of utilizing a semi-truck to efficiently transport Defendant Russell Stover’s goods, thereby creating a joint proprietary interest in this transportation supply chain.” (TAC ¶ 102, ECF No. 69 at 66-67 of 70.) According to the TAC, Russell Stover, Ryan, and Stone Truck “would share in the profits flowing from the reduction in transportation costs.” (Id. ¶ 104.) Plaintiff alleges Defendants would share in any losses incurred because Ryan and Stone Truck agreed to accept a reduction in their compensation caused by delivery delays. (Id.) Plaintiff further asserts they “possessed the right, under authority conferred by” the FMCSA and FMCSR “to voice their concerns related to and control the performance of this transportation supply chain.” (Id. ¶ 103.)

*22 “As a general rule, in order to constitute a joint adventure there must be a community of interest in the performance of a common purpose, a joint proprietary interest in the subject matter, a mutual right to control, a right to share in the profits, and a duty to share in any losses which may be sustained.” Cooper v. Curry, 1978-NMCA-1-4, ¶ 22, 92 N.M. 417 (quotation omitted). Plaintiff’s allegations fall short of showing non-conclusory facts that plausibly indicate that Russell Stover, Ryan, and Stone Truck had a joint proprietary interest in the transportation supply chain or a right to share in profits. Plaintiff’s allegations that the transportation supply chain’s purpose was to minimize the cost of transporting Russell Stover’s goods and that they would share in profits flowing from a reduction in transportation costs is insufficient to show that the parties agreed to share in the business venture’s profits. Thus, amendment to add this claim against Ryan and Russell Stover is futile. Cf. Rogers v. Anheuser-Busch, Inc., 491 F.3d 1165, 1166, 1171 (10th Cir. 2007) (holding that beer supplier who entered into sponsorship agreement with bar hosting concert was not liable for injuries sustained by driver after collision with intoxicated patron of bar based on joint enterprise theory because, while beer supplier benefitted from success of concert by selling more beer, entities did not share profits with one another; as seller of beer, it was simply paid for its product); Riley, 2017 WL 2501138, at *10-12 (concluding as matter of law that there was no joint venture where there was no evidence of express or implied agreement between broker and motor carrier to form joint venture and agreement’s independent contractor language clearly disavowed joint-venture relationship; there was no profit or control-sharing over enterprise; and they did not share risks, losses, or control); Cooper, 1978-NMCA-104, ¶¶ 22-23 (affirming trial court’s refusal to instruct jury on joint venture theory that doctor and hospital had community of interest in treating plaintiff because record did not show doctor had proprietary interest in hospital’s property, that there existed a mutual right to control, or that doctor was to share in the hospital’s profits or losses).

IT IS THEREFORE ORDERED that
1. Plaintiff’s Motion for Leave to File Supplemental Evidence in Support of Plaintiff’s Motion for Leave to File Amended Complaint and Reconsider its Order Dismissing Defendants Ryan Transportation Service, Inc. and Russell Stover Chocolates, LLC (Doc. 69) (ECF No. 81) is GRANTED but for the limited purpose described herein; and
2. Plaintiff’s Motion for Leave to File Amended Complaint and Reconsider its Order Dismissing Defendants Ryan Transportation Service, Inc. and Russell Stover Chocolates, LLC (Doc. 57) (ECF No. 69) is GRANTED in part and DENIED in part. The motion is GRANTED to the extent that Plaintiff may file his proposed amended complaint (ECF No. 69 at 24-70) to assert negligence claims against Defendants Ryan Transportation Service, Inc., and Russell Stover Chocolates, LLC. The Court, however, will DENY Plaintiff’s motion to amend to the extent he seeks to assert a joint enterprise theory of liability (Count V) and a statutory employer theory of liability against Defendant Russell Stover, as those theories are futile as a matter of law.

All Citations
Slip Copy, 2021 WL 5493076

Footnotes

1
The Court denied Plaintiff’s initial proposed second amended complaint, so the current operative complaint is the first amended complaint. The proposed amended complaint set forth in ECF No. 69 is Plaintiff’s third attempt to amend his complaint, so the Court will refer to the most recent proposed amended complaint as the third amended complaint (or “TAC”) to distinguish it from the previous proposed second amended complaint (“SAC”) (ECF No. 49-1), the filing of which the Court did not permit.

2
Other courts found significant that the ADA requires air carriers to maintain insurance coverage for personal injury claims; but in the FAAAA, a similar provision requires such insurance for motor carriers and freight forwarders, but not brokers. See Creagan, 354 F.Supp.3d at 814 (“The FAAAA mandates that to register as a motor carrier, the entity must carry liability insurance in an amount ‘sufficient to pay… for each final judgment against the registrant for bodily injury to, or death of, an individual resulting from the negligent operation, maintenance, or use of motor vehicles, or for loss or damage to property …, or both.’ 49 U.S.C. § 13906(a)(1). The FAAAA does not impose the same requirement on brokers. Not only does this affirmatively establish that a motor carrier may be liable for these types [of] negligence actions, but also the omission of the same language with respect to broker evinces Congressional intent that brokers not be liable for this conduct.”) While the insurance distinction between brokers and motor carriers is notable, ultimately, this Court finds more persuasive the reasoning of the courts that focus on the language of the preemption clause and how the negligent hiring claim derives from and impacts the service the broker provides.

3
Ryan argues that the public safety exception does not apply to common law negligent hiring claims, relying partially on the Supreme Court’s statement in Ours Garage that the purpose of the exception was to leave intact the “traditional state police power over safety.” (Ryan’s Reply 8-9, ECF No. 37 (quoting Ours Garage, 536 U.S. at 439).) Because a state’s “police power” is exercised by state legislatures, Ryan asserts that the exception does not apply to common law claims. (Id.) The Ninth Circuit, however, considered the same argument but concluded that, while “police power” does generally refer to legislation, the statement by the Supreme Court in Ours Garage should not be interpreted in such a precise way, because the Supreme Court was looking at municipal regulations that undisputedly were an exercise of “police power.” Miller, 976 F.3d at 1028. The Supreme Court had no reason to consider whether the safety exception is broader than its “police power” language suggested. Id.

4
According to the face of the Broker Addendum, a representative from Lindt signed on “3/23/18.” (Broker Addendum, ECF No. 48-1 at 31 of 31.) The first page of the Contract between Lindt & Sprüngli North America, Inc., (“Lindt”) and Ryan, which crosses out “Motor Carrier” for “Broker” for Ryan, gives an effective date of February 1, 2018. (Contract, ECF No. 48-1 at 17 of 31.) The first paragraph of the Contract appears to say that it was “entered into as of the 23 day of 3 2018, (‘Effective Date’) by and between” Lindt and Ryan. (Id. at 18 of 31.) The signatory for “Carrier” on the last page of the Contract expressly hand-wrote after his signature, “Subject to signed ‘Broker addendum to contract for truckload transportation.’ ” (Id. at 30 of 31.)

2021 WL 4962100

United States District Court, W.D. New York.
DOMINIQUE WILSON-ABRAMS, Plaintiff,
v.
RICHARD MAGEZI, SEAGATE FREIGHT, LLC, MICHAEL L. LAMBERT, WESTERN EXPRESS, INC., NATHAN TYRONE MITCHELL, and NAVAJO EXPRESS, INC., Defendants.
1:20-CV-01717-LJV-MJR
|
Filed 10/26/2021

DECISION AND ORDER
MICHAEL J. ROEMER United States Magistrate Judge

INTRODUCTION
*1 This case was referred to the undersigned pursuant to 28 U.S.C. § 636(b)(1) by the Hon. Lawrence J. Vilardo for all pretrial matters and to hear and report upon dispositive motions. (Dkt. No. 23) Before the Court are plaintiff’s motions to amend the complaint and compel discovery. (Dkt. No. 17) For the following reasons, plaintiff’s motion to amend the complaint is denied without prejudice and plaintiff’s motion to compel discovery is denied as moot and without prejudice.1

RELEVANT FACTS
Plaintiff Dominique Wilson-Abrams commenced this lawsuit in New York State Supreme Court, County of Erie, on December 9, 2019. (Dkt. No. 1-1) The complaint alleges that beginning at approximately 8:00 p.m. on January 29, 2019, through approximately 9:30 p.m. on February 1, 2019, the New York State Thruway Authority initiated a ban as to all tractor-trailers and commercial buses traveling on Interstate 90 between the Pennsylvania line and Exit 46 in Monroe County, New York. (Id. at ¶9) On January 30, 2019, at approximately 2:00 p.m., plaintiff, a police officer and resident of New York, was operating a 2016 Dodge patrol car bearing a New York State license plate marked “POLICE.” (Id. at ¶10) Plaintiff’s patrol car was situated stationary on the shoulder of the eastbound Interstate 90 in the Town of Leroy, New York, within the location of the travel ban. (Id.) At this same time, defendant Michael Lambert, a resident of Connecticut, was operating a 2019 International semi-tractor and attached trailer, owned by defendant Western Express Inc., whose corporate headquarters are located in Tennessee. (Id. at ¶¶3-4, ¶¶12-13) Defendant Richard Magezi, a resident of Texas, was operating a 2015 Freightliner semi-tractor and attached trailer. (Id. at ¶2, ¶11) Defendant Nathan Tyrone Mitchell, a resident of Arizona, was operating a 2016 Peterbilt semi-tractor and attached trailer, owned by defendant Navajo Express, Inc., whose corporate headquarters are located in Colorado. (Id. at ¶¶5-6, ¶¶16-17) The complaint further alleges that defendants Lambert, Magezi, and Mitchell were all traveling eastbound on Interstate 90, in violation of the travel ban. (Id. at ¶20) A multi-vehicle accident then occurred causing plaintiff’s patrol car to collide with the tractor-trailers operated by Lambert, Magezi and Mitchell, resulting in serious injury to Wilson-Abrams. (Id. at ¶21-22) On June 30, 2020, plaintiff filed an amended complaint in New York State Supreme Court adding Seagate Freight, LLC as an additional defendant. (Dkt. No. 1-6) The amended complaint alleges that the semi-tractor driven by Magezi at the time of the accident was owned by Seagate Freight, whose corporate offices are located in Texas. (Id.)

*2 All defendants filed answers to the amended complaint in New York state court, as well as cross-claims against their co-defendants. (Dkt. Nos. 1-8, 1-9, 1-10) On November 24, 2020, ail defendants filed a joint notice of removal, removing plaintiff’s lawsuit from New York State Supreme Court to the Western District of New York based on diversity jurisdiction. (Dkt. No. 1) Defendants represented that the action was properly removable pursuant to 28 U.S.C. § 1441(b) because (1) there was complete diversity of citizenship among the parties; (2) the amount in controversy exceeded $75,000; and (3) none of the parties in interest, who were properly joined and served as defendants, were citizens of New York. (Id. at ¶) Plaintiff did not oppose removal or seek to remand the matter to state court. Following the removal, this Court entered a Case Management Order which specified, inter alia, that motions to amend the pleadings or add parties were to be filed by July 15, 2021; motions to compel discovery were to be filed by December 15, 2021; and fact discovery was to be completed by January 18, 2022. (Dkt. No. 15)

On June 7, 2021, plaintiff filed the instant motion to amend the complaint to add additional defendants whose identities plaintiff learned through discovery. (Dkt. No. 17) Specifically, plaintiff seeks to add, as defendants, Jaime L. Burgostorres; Trans-porte, Inc., d/b/a U.S. Foods; Edward F. Dejoy; Midwest Transport, Inc.; and Penske Truck Leasing Co., L/P. (Id.) Plaintiff submits that these five proposed new defendants are the operators and/or owners of two additional tractor-trailers involved in the accident that injured Wilson-Abrams on January 30, 2019.2 (Id.) Plaintiff has also moved to compel Magezi and Seagate Freight as well as Mitchell and Navajo Express to provide Rule 26 initial disclosures and to respond to plaintiff’s outstanding interrogatories and requests for documents. (Id.) Defendants filed responses to the motions and plaintiff filed a reply. (Dkt. Nos. 19-22) The Court heard oral argument on July 28, 2021. (Dkt. No. 24)

DISCUSSION
Motion to Amend the Complaint
Federal Rule of Civil Procedure 15(a) provides that a party may amend its complaint only by leave of the court after a responsive pleading has been served, and that such leave shall be freely given when justice so requires. See Fed. R. Civ. P. 15(a)(2). The Second Circuit instructs that leave to file an amended complaint should not be denied unless there is evidence of undue delay, bad faith, undue prejudice to the non-movant, or futility. See Milanese v. Rust-Oleum Corp., 244 F.3d 104 (2d Cir. 2001). “Although the decision of whether to allow plaintiff[ ] to amend [the] complaint is left to the sound discretion of the district court, there must be good reason to deny the motion.” Actio v. IMCERA Group, 47 F.3d 47, 55 (2d Cir. 1995). Further, the party opposing the motion for leave to amend has the burden of establishing that an amendment would be prejudicial. See Fariello v. Campbell, 860 F. Supp. 54, 70 (EDNY 1994).

Federal Rule of Civil Procedure 8(a)
Defendants first argue that plaintiff’s motion to amend the complaint should be denied because plaintiff has failed to establish grounds for the Court’s jurisdiction. Specifically, defendants contend that the proposed second amended complaint does not set forth the citizenship of any of the defendants named therein, including both the current defendants and the proposed new defendants, and therefore does not comport with federal pleading requirements.

Federal Rule of Civil Procedure 8(a)(1) requires a plaintiff to allege, in the complaint, “a short and plain statement of the grounds for the court’s jurisdiction, unless the court already has jurisdiction and the claim needs no new jurisdictional support.” See Fed. R. Civ. P. 8(a)(1) (emphasis added).3 For purposes of establishing diversity jurisdiction, a plaintiff must allege the states of citizenship of all parties. Care Envtl. Corp. v. M2 Techs., Inc., CV-05-1600, 2006 U.S. Dist. LEXIS 2934, n. 1 (EDNY Jan. 18, 2006); accord Held v. Held, 137 F.3d 998 (7th Cir. 1998). Because “allegations of residency alone cannot establish citizenship”, Canedy v. Liberty Mut. Ins. Co., 126 F.3d 100, 103 (2d Cir. 1997), the citizenship of individuals, and not their residences, must be pleaded. Realty Holding Co. v. Donaldson, 268 U.S. 398, 399 (1925). Specifically, an individual’s citizenship is determined by his or her domicile, which is defined as “the place where a person has his true fixed home and principal establishment, and to which, whenever he is absent, he has the intention of returning.” Palazzo ex rel. Delmage v. Corio, 232 F.3d 38, 42 (2d Cir. 2000). Further, a corporation is deemed a citizen of any state (or foreign state) in which it is incorporated and of the state where it has its “principal place of business.” 28 U.S.C. § 1332(c)(1). For diversity purposes, a corporation may only have one principal place of business. See Egan v. Am. Airlines, Inc., 324 F.2d 565 (2d Cir. 1963). In order to determine the citizenship of a corporation, a court must be informed both of all of the states in which it is incorporated as well as its principal place of business. Tarpon Bay Partners LLC v. Visium Techs., 3:18-CV-02003, 2021 U.S. Dist. LEXIS 196954 (Dist. Conn. Oct. 13, 2021). A limited liability company takes the citizenship of each of its members. Handelsman v. Bedford Vill. Assoc. Ltd. P’ship, 213 F.3d 48, 51-52 (2d Cir. 2021). Likewise, “limited partnerships have the citizenship of each of its general and limited partners.” Carden v. Arkoma Assocs., 494 U.S. 185, 195-96 (1990).

*3 Here, the proposed second amended complaint does not adequately allege the citizenship of any of the named defendants, including both the current defendants as well as the proposed new defendants. (Dkt. No. 17-9) As to each of the corporate defendants listed, both current and prospective, the proposed second amended complaint fails to set forth their places of incorporation or organization. (Id. at ¶4-¶15) The proposed second amended complaint also fails to name each current and prospective corporate defendant’s principal place of business or, in the case of the limited liability companies or limited partnerships, the domiciles of their members.4 (Id.) Further, the proposed second amended complaint alleges only the residences, not the citizenships, of both the current and prospective individual defendants. (Id.) These allegations are insufficient to confer jurisdiction. See Canedy, 126 F.3d at 103 (finding that the complaint failed to comply with Rule 8(a)(1) where, inter alia, it merely alleged that defendant was a resident of Virginia); Carlson v. Bond, CV-04-4480, 2005 U.S. Dist. LEXIS 45441 (EDNY June 15, 2005) (“Allegations concerning a party’s place of residence are insufficient to establish diversity of citizenship because a person may be a resident of one state but a citizen of another.”). Young-Gibson v. Patel, 476 F. App’x 482 (2d Cir. June 12, 2012) (allegations of residency alone cannot establish whether parties are citizens of different states for purposes of establishing federal subject matter jurisdiction.).

Here, the Court first finds that, as to the current defendants in this lawsuit, plaintiff’s failure to properly state defendants’ citizenship in the proposed second amended complaint does not violate Rule 8(a)(1) because jurisdiction has already been established as to these defendants. Indeed, all current defendants jointly removed this matter to the Western District of New York based on diversity jurisdiction. (Dkt. No. 1) The notice of removal specifically set forth the citizenships of plaintiff Wilson-Abrams (New York); the individual defendants Magezi (Texas), Lambert (Connecticut), and Mitchell (Arizona); and the corporate defendants Seagate Freight (Texas), Western Express (Tennessee) and Navajo Express (Colorado). Moreover, all parties agree, and the notice of removal adequately demonstrates, that complete diversity of citizenship exists between plaintiff and the current defendants. Thus, all the parties as well as the Court concur that federal jurisdiction as to these defendants is proper. See Gangl v. Williamson, 83-CV-449, 1984 U.S. Dist. LEXIS 14754 (NDNY July 23, 1984) (“While it is of course true that 28 U.S.C. § 1332(a) requires diversity of citizenship, and plaintiff’s complaint speaks of residency, the court sees no purpose to be served in requiring an amended complaint for such recitation where there appears to be no genuine dispute as to plaintiff’s citizenship, or the citizenship of the defendants herein.”).

In contrast, jurisdiction has not been established as to the five new defendants that plaintiff seeks to join to the lawsuit through the filing of a second amended complaint. As noted above, plaintiff alleges only the “corporate headquarters” of each business and the residences of each individual. Moreover, the proposed second amended complaint alleges that one of the newly proposed defendants, Edward F. Dejoy, is a resident of New York. (Dkt. No. 17-9, ¶13) This allegation suggests that Dejoy may likely be domiciled in, and therefore a citizen of, New York. During oral argument, it was agreed that to the extent one or more of the proposed new defendants is a citizen of New York, diversity jurisdiction would no longer exist here. See Owen Equipment & Erection Co. v. Kroger, 437 U.S. 365, 373 (1978) (“diversity jurisdiction does not exist unless each defendant is a citizen of a different state from each plaintiff”). It was further agreed that if the Court were to permit joinder of a non-diverse party, the Court would be required to remand this case back to New York State Supreme Court. Smith v. Nkomarume, 17 CV 6369, 2018 U.S. Dist. LEXIS 158171 (SDNY Sept. 5, 2018) (“If complete diversity is destroyed by joinder of a new party, and if the federal court otherwise lacks subject matter jurisdiction over the case, the case must be remanded.”). However, without a proposed second amended complaint which adequately sets forth the citizenship of each of the five proposed new defendants, the Court cannot make a determination either about the adequacy of the proposed amendment or how the amendment would affect federal jurisdiction over this lawsuit. Thus, plaintiff’s motion to amend the complaint is denied without prejudice. Plaintiff is instructed to renew the motion to amend together with a new proposed second amended complaint that adequately sets forth the citizenship of each of the five proposed new defendants to this lawsuit.5

Fundamental Fairness and 28 USC § 1447
*4 Defendants next argue that even if plaintiff were deemed to have complied with federal pleading requirements, the Court should deny any proposed amendment that would seek to add parties whose presence would defeat this Court’s prior established jurisdiction over the case. Stated another way, defendants submit that plaintiff should be permitted to add only defendants who would not destroy federal diversity jurisdiction, and that plaintiff should be required to assert her claims against any non-diverse parties in a separate state court action.6

Section 1447(e) of Title 28 of the United States Code provides that “|i]f after removal the plaintiff seeks to join additional defendants whose joinder would destroy subject matter jurisdiction, the court may deny joinder, or permit joinder and remand the action to the state court.” 28 USC § 1447(e). Courts in the Second Circuit generally apply a two-part test when deciding whether to permit diversity-destroying joinder. See Barber v. Somal Logistics Ltd., 20-CV-854, 2021 U.S. Dist. LEXIS 100789 (WDNY May 27, 2021), First, joinder must satisfy Rule 20 of the Federal Rules of Civil Procedure, which permits joinder of multiple defendants in one action “if there is asserted against [the defendants] any right to relief… arising out of the same [ ] occurrences and if any question of law or fact common to all defendants will arise in the same action.” Fed. R. Civ. P. 20. Here, it is undisputed that all current and prospective defendants were involved in the same occurrence or event, namely the automobile accident that injured Wilson-Abrams, and that a lawsuit including all of these parties would involve common questions of law or fact. See United Mine Workers of Am. v. Gibb, 383 U.S. 715 (1966) (stating that under the Federal Rules generally, “the impulse is toward the broadest possible scope of action consistent with fairness to the parties [and therefore] joinder of claims, parties and remedies is strongly encouraged.”); Amon v. Nelson, 91 Civ. 3844, 1992 U.S. Dist. LEXIS 280 (SDNY Jan. 15, 1992) (“Joinder is favored so that all claims arising from an event or series of events can be resolved in a single litigation.”) Thus, Rule 20 poses no obstacle to joinder here.

Second, courts in this Circuit employ a “fundamental fairness” analysis to determine whether the balancing of certain factors “weighs in favor of joinder and its necessarily attendant remand.” McGee v. State Farm Mut. Auto Ins. Co., 684 F. Supp. 2d 258, 262 (EDNY 2009). This analysis consists of the following factors: (1) any delay, as well as the reason for delay, in seeking joinder; (2) resulting prejudice to defendants; (3) likelihood of multiple litigations; and (4) plaintiff’s motivation for the amendment. See Nazario v. Deere & Co., 295 F. Supp. 2d 360, 363 (SDNY 2003). The factors should be considered in light of the totality of the circumstances, Vanderzalm v. Sechrist Indus., 875 F. Supp. 2d 179, 184 (EDNY 2012), and “[d]iversity-destroying jurisdiction is permitted when the factors weigh in the moving party’s favor.” Nazario, 295 F. Supp. 2d at 363.

First, delay in seeking amendment to the complaint is measured from the date of removal. See Nazario, 295 F. Supp. at 363. Here, defendants removed this action from state court on November 24, 2020. (Dkt. No. 1) Plaintiff moved to amend the complaint to join the new defendants a little over six months later, on June 7, 2021. (Dkt. No. 17) Plaintiff’s motion to amend was timely pursuant to the Case Management Order proposed by the parties and entered by this Court. See Smith, 2018 U.S. Dist LEXIS 158171, *15 (“Where the motion for joinder falls within the schedule set by the court for such motions, this alone may excuse what might have otherwise been an unreasonable delay.”).

*5 Moreover, plaintiff submits a reasonable and valid reason for the delay, namely that she was unaware of the involvement of the proposed new defendants in the accident until she received discovery materials, and that she then promptly moved to amend. Plaintiff represents that she was rendered unconscious in the collision and therefore had to rely upon available reports and photographs of the accident to determine the proper parties to sue. According to the police report of the incident, plaintiff was seated in her patrol car on the shoulder of the road when her car was struck from behind by the tractor-trailer operated by Magezi and owned by Seagate Freight. (Dkt. No. 17-10) The impact pushed the patrol car into the driving lane, where it was struck by the tractor-trailer operated by Lampert and owned by Western Express (Id.) The patrol car then collided with the tractor-trailer operated by Mitchell and owned by Navajo Express. (Id.) Plaintiff submits that it was not until March 2, 2021, when Western Express provided dash camera footage of the accident as part of its initial disclosures, that plaintiff learned that additional tractor-trailers were involved in the accident. Plaintiff indicates that the dash camera video shows that after initially colliding with plaintiff’s patrol car, the Western Express tractor-trailer came to a stop and was then subjected to additional impacts by the tactor-trailers owned and/or operated by the new proposed defendants. These additional impacts caused the Western Express tractor-trailer to move forward and again collide with plaintiff’s patrol car. Within a few months of receiving and reviewing this video, plaintiff obtained the identities of the additional parties and moved to amend the complaint to join them in the lawsuit. Thus, any delay in moving to join non-diverse defendants was the result of newly acquired information as opposed to a lack of diligence or dilatory tactics on the part of plaintiff, and this factor weighs in favor of granting the amendment. See e.g., Bruno v. Zimmer, Inc., CV 15-6129, 2018 U.S. Dist. LEXIS 16830 (EDNY Feb. 1, 2018) (eleven month delay in moving to amend was excusable where plaintiff only recently learned of certain instrumental facts through disclosures from defendants); Young v. Simon Ladder Towers, Inc., 96 Civ. 0189E, 1996 U.S. Dist. LEXIS 17570 (WDNY Nov. 26, 1996) (finding that delay of four and a half months was not of sufficient duration to warrant denying the motion to join non-diverse parties because plaintiff provided an adequate reason for that delay).7

As to the second factor, the Court can discern no prejudice to the current defendants in granting the motion to amend. Despite being filed in state court on December 10, 2019, the case remains in its preliminary stages. Plaintiff notes that because the parties understood that the matter would ultimately be removed to federal court, the parties did not conduct any conferences or exchange any discovery while the matter was pending in state court. Furthermore, through no fault of plaintiff, very little discovery has taken place since the case has been pending here. In fact, when plaintiff made the instant motion to amend, neither defendants Magezi and Seagate Freight nor defendants Mitchell and Navajo Express had timely complied with their Rule 26 initial disclosure requirements or responded to plaintiff’s request for interrogatories or document production. Plaintiff represents that the initial mediation session was canceled as a result of defendants’ delay in producing discovery. Moreover, it does not appear that any depositions have been taken and the fact discovery deadline does not expire until January of 2022. Thus, this lawsuit has not advanced to a point where remand with additional defendants would cause the current defendants to revise or abandon a litigation strategy for which resources have already been expended, nor would joinder of the additional defendants impair the present defendants’ ability to defend against the claims. See Guadagno v. M.A. Mortenson Co., 1:15-CV-00482, 2018 U.S. Dist. LEXIS 167958 (WDNY Sept. 28, 2018) (the potential for additional discovery alone is not sufficient to constitute prejudice); Hosein v. CDL West 45th St., LLC, 12-CV-06903, 2013 U.S. Dist. LEXIS 130030 (SDNY June 12, 2013) (finding six-month delay was excusable because plaintiff’s filing of the amended complaint complied with court-ordered deadlines, plaintiff pursued discovery from defendant to determine role of proposed parties and defendant demonstrated no prejudice). For these reasons, the Court finds that the lack of prejudice against defendants weighs in favor of joinder.8

*6 As to the third factor, “[c]ourts in [this] circuit have held that avoidance of multiple litigations weighs in favor of joinder of a party, even if joinder will defeat diversity.” Juliano v. Toyota Motor Sales, U.S.A., Inc., 20 F. Supp. 2d 573, 576 (SDNY 1998) (collecting cases). Here, joinder of defendants would allow plaintiff to litigate all claims arising from the January 30, 2019 automobile accident in one proceeding, whereas a denial of joinder would require plaintiff to proceed on the claim in two different forums. Bruno, 2018 U.S. Dist. LEXIS 16830, at *2 (denial of the motion would undoubtedly result in multiple litigations since plaintiff would be forced to commence separate state court actions against the other defendants). Likewise, because a trial against the current defendants would involve the same evidence as a trial involving the proposed defendants, joinder followed by remand could promote the efficient use of judicial resources, could spare witnesses the trouble of testifying at two different trials, and would allow plaintiff to resolve all of her claims relating to the accident in a single action without the danger of inconsistent judgments. See also Gurksy v. Northwestern Mut. Life Ins., Co., 139 F.R.D. 279, 283 (EDNY 1991) (Remand of this action will both avoid wasting judicial resources as well as the “inherent dangers of inconsistent results, both of which are at risk when parallel federal and state actions proceed simultaneously.”); Amon, 1992 U.S. Dist. LEXIS 280 at *8 (joinder satisfied fundamental fairness test where joining defendant would allow the dispute to be resolved in a single litigation and would therefore “prevent duplicative litigation, extra expense to the parties and the waste of judicial resources” and would “avoid piecemeal litigation against alleged joint-tortfeasors and the concomitant danger of inconsistent findings.”). Thus, this factor also weighs in favor of joinder.

The last factor involves a consideration of plaintiff’s motivation for the joinder request. To that end, joinder is not warranted where a plaintiff seeks to add the non-diverse parties solely to bring about a remand to state court. See Nazario, 295 F. Supp. 2d at 364. However, where “a plaintiff discovers new information subsequent to filing [a] complaint, that warrants the addition of new parties, courts have held that no inference arises that the plaintiff was motivated to join the defendant solely to defeat jurisdiction.” Cooper v. Trs. Of the College of the Holy Cross, 13-CV-8064, 2014 US Dist. LEXIS 82464 (SDNY June 17, 2014). As described above, plaintiff has set forth concrete reasons, beyond a preference for a particular forum, as to why she requests joinder of the new defendants. Specifically, plaintiff recently learned that additional parties were involved in the accident, and she now seeks to resolve her claims against all defendants relating to the accident in a single lawsuit. Indeed, before learning of the additional defendants, plaintiff raised no objection to proceeding in federal court. Thus, the Court finds no evidence here that plaintiff is motivated either by bad faith or a singular desire to proceed in state court. Thus, the final factor also weighs in favor of joinder. See Roll on Express, Inc. v. Travelers Indem. Co, of Conn., 09-CV-213, 2009 U.S. Dist. LEXIS 56729 (EDNY July 2, 2009) (permissible motivation for joinder where plaintiff discovers new information, subsequent to filing the complaint, that warrants the addition of new parties); Rodriguez v. Abbott Labs., 151 F.R.D. 529 (SDNY Nov. 1, 1993) (Joinder permitted where the district court had “no reason to suspect that plaintiff [was] merely attempting to defeat diversity and drag the case into her originally selected forum.”).

In sum, after consideration of the factors described above, the Court finds that joinder of the new defendants comports with the principals of fundamental fairness, even if the joinder ultimately results in destruction of this Court’s diversity jurisdiction and remand of this lawsuit to state court. Thus, defendants’ contention that plaintiff should only be permitted to amend the complaint to include diverse parties is rejected. As instructed previously, plaintiff shall renew the motion to amend with a new proposed second amended complaint that adequately sets forth the citizenship of all new defendants whom plaintiff seeks to join. Should the newly proposed complaint join one or more non-diverse defendants, and should it not assert any other basis for federal subject matter jurisdiction, this Court will issue a recommendation to the District Court that the case be remanded to New York State Supreme Court. See 28 U.S.C. § 1447(c) (A district court must remand a case to state court “if at any time before final judgment it appears that the district court lacks subject matter jurisdiction.”).

Plaintiff’s Motion to Compel
*7 In addition to filing the motion to amend the complaint, plaintiff has moved to compel various discovery responses from defendants Magezi and Seagate Freight as well as defendants Mitchell and Navajo Express. Defendants Magezi and Seagate Freight respond that they provided Rule 26 initial disclosures to plaintiff on July 8, 2021, the day after plaintiff filed the motion to compel, and that they are making “diligent efforts” to respond to plaintiff’s first set of interrogatories and request for production of documents. (Dkt. No. 20) Defendants Mitchell and Navajo Express respond that they provided Rule 26 initial disclosures, responses to plaintiff’s first set of interrogatories and responses to plaintiff’s request for document production on July 8, 2021.9 (Dkt. No. 21) Because the outstanding discovery requests have either been provided or defendants have indicated that they will be provided, the Court denies plaintiff’s motion to compel as moot and without prejudice. The Court also denies the discovery motion as moot since it is likely that an amended complaint will be filed with additional, non-diverse defendants, creating a likelihood that the case will be remanded to state court and requiring additional discovery.

CONCLUSION
For the foregoing reasons, plaintiff’s motion to amend the complaint is denied without prejudice and plaintiff is instructed to file a renewed motion to amend, together with a new proposed second amended complaint that complies with Federal Rule of Civil Procedure 8(a)(1), on or before November 5, 2021. (Dkt. No. 17) Plaintiff’s motion to compel discovery is denied as moot and without prejudice. (Dkt. No. 17)

SO ORDERED.

Dated: October 22, 2021

Buffalo, New York

All Citations
Slip Copy, 2021 WL 4962100

Footnotes

1
In Fielding v. Tollaksen, 510 F.3d 175 (2d Cir. 2007), the Second Circuit stated, in dicta, that a motion to amend is a nondispositive motion that may be referred to a magistrate judge and is subject to a clearly erroneous or contrary to law standard of review. While there have been conflicting views on the issue expressed by the district courts in the past, there is a general consensus in this Circuit that the determination of a motion to amend is considered nondispositive. See Steuben Foods, Inc. v. Gea Process Engineering, Inc., 1:12-CV-00904, 2016 U.S. Dist. LEXIS 90318 (WDNY July 12, 2016) (explaining that the weight of authority in this Circuit, as well as the Second Circuit’s decision in Fielding, is in favor of treating a motion to amend as nondispositive); Mid. Ml. Framing, LLC v. Varish Constr., Inc., 3:13-CV-01376, 2017 U.S. Dist. LEXIS 146874 (NDNY Sept. 11, 2017) (“Courts in the Second Circuit have generally considered motions to amend a complaint as non-dispositive.”); Dollar Phone Corp. v. St. Paul Fire & Marine Ins. Co., 09-CV-1640, 2011 U.S. Dist. LEXIS 22207 (EDNY Mar. 4, 2011) (“[A] magistrate judge’s decision on a motion to amend is nondispositive[.]”); Thompson v. United States, 16-CV-3468, 2018 U.S. Dist. LEXIS 2280 (SDNY Jan. 3, 2018) (“Motions…to amend are generally considered nondispositive motions.”) Based upon this case law, and because the Court is denying plaintiff’s motion to amend without prejudice, the Court issues the instant determination in the form of a decision and order.

2
The addition of the five new defendants, and allegations that these defendants were also involved in the automobile accident on January 30, 2019 and that their negligence also caused injury to Wilson-Abrams, are the only changes plaintiff seeks to make to the complaint.

3
Here, the proposed second amended complaint notes, with respect to jurisdiction and venue, that this case was previously removed to the Western District of New York by defendants based on “complete diversity of citizenship between the parties” and that the amount in controversy exceeds $75,000. (Dkt. No. 17-9) Based upon these allegations and the fact that plaintiff asserts only state law claims, it appears that plaintiff has attempted to invoke federal diversity jurisdiction with respect to the proposed second amended complaint. See 28 USC § 1332 (“The district courts shall have original jurisdiction of all civil actions where the matter in controversy exceeds the sum or value of $75,000, exclusive of interests and costs, and is between…citizens of different states.”).

4
The proposed second amended complaint does allege a “corporate headquarters” for each of the named corporate defendants. While a defendant’s corporate headquarters and principal place of business may be the same, that is not always the case, and the complaint should specify each defendant’s principal place of business. See Hertz v. Friend, 559 U.S. 77, 92 (2010) (“In this context, the term ‘principal place of business,’ often called the ‘nerve center,’ refers to the place where a corporation’s officers direct, control, and coordinate the corporation’s activities, normally the place where the corporation maintains its headquarters.”); compare Inland Rubber Corp. v. Triple A Tire Serv., Inc., 220 F. Supp. 490, 492 (SDNY 1963) (finding corporation’s principal place of business to be New York even though corporate headquarters were located in Ohio).

5
A failure to allege facts establishing jurisdiction need not prove fatal to a complaint. “[D]efective allegations of jurisdiction may be amended, upon terms, in the trial or appellate courts,” 28 U.S.C. § 1653. Such amendments will be freely permitted where necessary to avoid dismissal on purely technical grounds. See Canedy, 126 F.3d at 103.

6
As noted previously, it is generally agreed by the parties that at least one of the proposed new defendants is likely a citizen of New York and that, should plaintiff be permitted to join this individual, the Court would no longer possess subject matter jurisdiction over the lawsuit.

7
It is noted that the current defendants do hot contradict plaintiff’s explanation of the contents of the dash camera video, nor do they dispute that the proposed new defendants were involved in the accident on January 30, 2019.

8
Plaintiff also raises a cogent argument that denial of joinder of non-diverse parties could prejudice her claims against the remaining defendants. Specifically, if plaintiff was required to proceed against only the current defendants and other diverse parties in federal court, while being required to sue the non-diverse parties separately in state court, defendants in the federal lawsuit would have the advantage of an “empty chair defense” and could blame the accident and plaintiff’s injuries on the negligent actions of the absent defendants.

9
Plaintiff has not moved to compel discovery from Lambert and Western Express and has noted that these defendants have complied with discovery demands.