United States District Court for the District of New Jersey

October 27, 2022, Decided; October 27, 2022, Filed

No. 22cv1668 (EP) (AME)

Reporter

2022 U.S. Dist. LEXIS 196775 *; 2022 WL 16362467

FREIGHT CONNECTIONS, INC., Plaintiff, v. EXPRESS HOUND, LLC; KING CARGO, LTD.; PROGRESSIVE INSURANCE, INC.; JOHN DOES AND XYZ CORPS, Defendants.

Notice: NOT FOR PUBLICATION

Core Terms

transportation, carrier, Cargo, broker, entity, truck, allegations, Freight, motor carrier, interstate, preempted, delivery, shipment

Counsel:  [*1] For FREIGHT CONNECTIONS INC, Plaintiff: RANDY T. PEARCE, LEAD ATTORNEY, PEARCE LAW, LLC, HACKENSACK, NJ.

For EXPRESS HOUND LLC, Defendant: RICHARD M. FRICKE, LEAD ATTORNEY, RICK A. STEINBERG, THOMAS C. MARTIN, PRICE MEESE SHULMAN & D’ARMINIO, PC, Woodcliff Lake, NJ.

For KING CARGO LTD, Defendant: LORNE M. REITER, LEAD ATTORNEY, LAW OFFICES OF LORNE M. REITER, LLC, ATLANTIC HIGHLANDS, NJ; SHARON BETH MORELAND, LAW OFFICES OF LORNE M. REITER, LLC, NJ, ATLANTIC HIGHLANDS, NJ.

For PROGRESSIVE INSURANCE INC, Defendant: JOHN MICHAEL PALM, LEAD ATTORNEY, LAW OFFICE OF JOHN M. PALM, LLC, GIBBSBORO, NJ.

For KING CARGO LTD, Cross Claimant: SHARON BETH MORELAND, LAW OFFICES OF LORNE M. REITER, LLC, NJ, ATLANTIC HIGHLANDS, NJ.

For EXPRESS HOUND LLC, Cross Defendant: RICHARD M. FRICKE, LEAD ATTORNEY, RICK A. STEINBERG, THOMAS C. MARTIN, PRICE MEESE SHULMAN & D’ARMINIO, PC, Woodcliff Lake, NJ.

Judges: Evelyn Padin, United States District Judge.

Opinion by: Evelyn Padin

Opinion

Evelyn Padin, U.S.D.J.

Presently before the Court is Defendant Express Hound, LLC’s (“Express Hound’s”) motion to dismiss Plaintiff Freight Connections, Inc.’s complaint under Federal Rule of Civil Procedure 12(b)(6). D.E. 3. The Court has reviewed the parties’ submissions and decides the motion without [*2]  oral argument. See Fed. R. Civ. P. 78(b); L. Civ. R. 78.1(b). For the reasons stated below, Express Hound’s motion is GRANTED.

I. BACKGROUND¹

A. Factual Background

On or about December 11, 2020, Plaintiff engaged Express Hound to transport mixed freight under Bill of Lading No. 0025464 from Ridgefield, New Jersey to Houston, Texas. D.E. 1-2 ¶ 6. On or about December 17, 2020, Plaintiff “tendered the shipment from its facility in Ridgefield, New Jersey to Express [Hound].” Id. P 7. Express Hound thereafter “utilized the services of King Cargo as carrier to transport the goods via truck.” Id. ¶ 8. Express Hound never informed Plaintiff about its use of King Cargo to transport the shipment. Id. 1-2 ¶ 9. The King Cargo employee/truck driver who was responsible for transporting the goods to Houston, Texas improperly diverted the truck to Orlando, Florida. Id. ¶ 10. When the truck arrived in “Texas, it was determined that the seal on the truck was broken and goods with a total value of $ 73,308.71 were missing from the truck as a result of an apparent theft by the driver.” Id. ¶ 12.

Prior to the foregoing incident, on July 20, 2020, Plaintiff and Express Hound entered into a Broker-Shipper Agreement that, inter alia, refers to Express [*3]  Hound as “BROKER” and Plaintiff as “SHIPPER,” and states that Express Hound would “maintain cargo insurance in the amount of $ 100,000 as supplemental contingency insurance to compensate [Plaintiff] for loss or damage to shipments tendered to [Express Hound’s] transportation services.” Id. ¶ 14.

B. Procedural History

Plaintiff initiated this action in New Jersey Superior Court on or about January 24, 2022. Plaintiff’s ten-count complaint asserts the following causes of action: (1) Breach of Contract (First Count), against all defendants; (2) Breach of the Covenant of Good Faith and Fair Dealing (Second Count), against all defendants; (3) Negligence (Third Count), against Express Hound and King Cargo; (4) Agency (Fourth Count), against Express Hound; (5) Negligent Hiring, Training, Supervision and Retention (Fifth Count), against Express Hound; (6) Agency (Sixth Count), against King Cargo; (7) Negligent Hiring, Training, Supervision, and Retention (Seventh Count), against King Cargo; (8)Theft (Eighth Count), against King Cargo; (9) Conversion (Ninth Count), against Express Hound and King Cargo; and (10) Declaratory Judgment, against King Cargo’s insurance carrier, Progressive Insurance. [*4]  D.E. 1-2.

On March 24, 2022, Express Hound removed this matter to this Court. Express Hound’s notice of removal correctly notes that “[t]he recovery sought [by Plaintiff in this matter] is for the alleged loss of cargo that was to be transported by [King Cargo] from Ridgefield, New Jersey to Houston, Texas under state law theories of breach of contract, negligence, and conversion.” D.E. 1-1 ¶ 2. Express Hound’s removal notice also accurately notes that “[u]nder well-established law from jurisdictions across the country, state law claims arising from the loss or damage to cargo transported via interstate commerce are preempted by federal law, including by . . . 49 U.S.C. § 14706(a)(1) (the ‘Carmack Amendment‘).” Id. ¶ 3. Plaintiff has not challenged the propriety of removal, and the Court agrees that Plaintiff’s claims are subject to federal preemption.

On April 6, 2022, Express Hound moved to dismiss Plaintiff’s complaint pursuant to Federal Rule of Civil Procedure 12(b)(6). D.E. 3. On May 5, 2022, Plaintiff filed its opposition to the same. D.E. 5. Express Hound filed its reply on the same day. D.E. 6.

II. LEGAL STANDARD

Federal Rule of Civil Procedure 8(a) does not require that a complaint contain detailed factual allegations. However, the allegations must be sufficient to raise a plaintiff’s right [*5]  to relief above a speculative level, so that a claim is “plausible on its face.” Twombly, 550 U.S. at 570; see also West Run Student Hous. Assocs., LLC v. Huntington Nat. Bank, 712 F.3d 165, 169 (3d Cir. 2013). That standard is met “when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009) (citing Twombly, 550 U.S. at 556). While “[t]he plausibility standard is not akin to a ‘probability requirement’ . . . it asks for more than a sheer possibility.” Id.

Rule 12(b)(6) provides for the dismissal of a complaint if it fails to state a claim upon which relief can be granted. As the moving party, the defendant bears the burden of showing that no claim has been stated. Animal Sci. Prods., Inc. v. China Minmetals Corp., 654 F.3d 462, 469 n.9 (3d Cir. 2011). For the purposes of the motion, the facts alleged in the complaint are accepted as true and all reasonable inferences are drawn in favor of the plaintiff. New Jersey Carpenters & the Trustees Thereof v. Tishman Const. Corp. of New Jersey, 760 F.3d 297, 302 (3d Cir. 2014).

III. ANALYSIS

Plaintiff, by way of this lawsuit, seeks recovery for the financial losses it sustained “as a result of an apparent theft by [King Cargo’s truck] driver” during the interstate shipment of its goods. See D.E. 1-2 at ¶ 12. Plaintiff’s complaint asserts ten separate state law claims as bases for relief. Express Hound argues that dismissal of Plaintiff’s complaint, in its entirety, is appropriate because the sole cause [*6]  of action that Plaintiff may assert based on the facts alleged in its complaint is a federal Carmack Amendment claim, and its complaint contains no such allegation. See D.E. 3-1 at 3; D.E. 6 at 3. The Court agrees.

The Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. § 14706, governs the field of interstate shipping. Inter Metals Grp. v. Centrans Marine Shipping, No. CV 20-7424, 2022 U.S. Dist. LEXIS 28747, 2022 WL 489404, at *2 (D.N.J. Feb. 17, 2022). The Amendment “preempts all state law claims for compensation for the loss of or damage to goods shipped by a ground carrier in interstate commerce.” Certain Underwriters at Interest at Lloyds of London v. United Parcel Service of America, Inc., 762 F.3d 332, 333 (3d Cir. 2014); accord Phoenix Assur. Co. v. Kmart Corp., 977 F. Supp. 319, 324 (D.N.J. 1997) (the Amendment “provides an exclusive remedy for the loss of goods transported in interstate commerce by motor carriers and freight forwarders.”); see also AMG Res. Corp. v. Wooster Motor Ways, Inc., 796 F. App’x 96, 100 (3d Cir. 2020) (“The modern Carmack Amendment still preempts all state regulation regarding the loss or injury to goods in commerce, so that the shipper’s recourse is only against carriers.”).

Stated simply, the lone cause of action which Plaintiff may assert based on the facts alleged in its complaint is a federal Carmack Amendment claim. Because Plaintiffs complaint contains only state law claims that are preempted by that Amendment, the Court will dismiss the complaint, in its entirety. Inter Metals Grp., 2022 U.S. Dist. LEXIS 28747, 2022 WL 489404, at *3-4 (dismissing plaintiff’s state law claims under Rule 12(b)(6) because those claims were, inter alia, preempted by the Carmack Amendment).

Express Hound further avers that its [*7]  dismissal from this matter, specifically, must be with prejudice because the facts alleged in Plaintiff’s complaint show that Express Hound was, at all relevant times, acting merely as a “broker” (who cannot be held liable under the Carmack Amendment), as opposed to a “carrier” (who can be liable under the Amendment). D.E. 3-1 at 11. For the reasons that follow, the Court cannot conclusively rule, at this time, on this issue. Moreover, because there are facts alleged in the complaint which suggest that Express Hound may have acted as a carrier for purposes of Plaintiff asserting a Carmack Amendment against it, the Court will decline to enter prejudicial dismissal against Express Hound at this time.

To be clear, liability under the Carmack Amendment extends to any “carrier” providing transportation or service. 49 U.S.C. § 14706(a)(1). “To establish a prima facie case against a carrier under the Carmack Amendment, a shipper must prove (1) delivery of goods to the initial carrier in good condition, (2) damage of the goods before delivery to their final destination, and (3) the amount of the damages.” Mrs. Ressler’s Food Prods. v. KZY Logistics LLC, 675 Fed. Appx. 136, 140 (3d Cir. 2017) (internal quotation omitted). Here, Plaintiffs complaint alleges that Plaintiff was a shipper who delivered its goods to Express Hound in Ridgefield, New Jersey in good condition, [*8]  that some of those goods were stolen before delivery to their final destination in Dallas, Texas, and that Plaintiff has been damaged in the amount of $ 73,308.71 as a result. The only issue that is unclear based on the factual allegations in Plaintiff’s current pleading is whether Express Hound assumed the role of carrier at any point in the transaction.

Under the Carmack Amendment, a “carrier” includes “a motor carrier,” which is defined as “a person providing motor vehicle transportation for compensation.” 49 U.S.C. § 13102(3), (14). The term “transportation” includes both the actual movement of property and “services related to that movement,” including arranging delivery of property. 49 U.S.C. § 13102(23). On the other hand, a “broker” is “a person, other than a motor carrier [that] . . . sells, offers for sale, negotiates for, or holds itself out by solicitation, advertisement, or otherwise as selling, providing, or arranging for, transportation by motor carrier for compensation.” 49 U.S.C. § 13102(2); see also 49 C.F.R. § 371.2.

Importantly, “[i]f [an entity] accepted responsibility for ensuring delivery of goods, regardless of who actually transported them, then [the entity] qualifies as a carrier. If, however, [the entity] merely agreed to locate and hire a third party to [*9]  transport the machines, then it was acting as a broker.” Nipponkoa Ins. Co., Ltd. v. C.H. Robinson Worldwide, Inc., No. 09 Civ. 2365(PGG), 2011 U.S. Dist. LEXIS 17752, 2011 WL 671747, at *7 (S.D.N.Y. Feb. 18, 2011) (quoting CGU Int’l Ins., PLC v. Keystone Lines Corp., No. 02-3751, 2004 U.S. Dist. LEXIS 8123, 2004 WL 1047982, at * 2 (N.D. Cal. May 5, 2004)); accord Tryg Ins. v. C.H. Robinson Worldwide, Inc., No. CV155343MASTJB, 2017 U.S. Dist. LEXIS 195259, 2017 WL 5725057, at *6 (D.N.J. Nov. 28, 2017), aff’d, 767 F. App’x 284 (3d Cir. 2019).

Courts consider various factors to determine whether a party is in fact a “motor carrier” or a “broker” under the Carmack Amendment. See Pelletron Corp. v. C.H. Robinson Worldwide, Inc., No. 09-2365, 2012 WL 3104845, at *3-4 (E.D. Pa. July 31, 2012). This includes: (1) whether the entity promised to personally perform the transport and therefore legally bound itself to transport; (2) the type of services the entity offers; (3) whether the entity held itself out to the public as the actual transporter of goods; and (4) whether the entity’s only role was to secure a third party to ship plaintiff’s goods. Id. To that end, the inquiry into whether an entity is a “carrier” or “broker” is inherently fact intensive. See Nipponkoa Ins. Co., Ltd., 2011 U.S. Dist. LEXIS 17752, 2011 WL 671747; Tryg Ins., 2017 U.S. Dist. LEXIS 195259, 2017 WL 5725057.

Here, Plaintiffs complaint expressly alleges that Plaintiff engaged Express Hound to carry a shipment of mixed freight under a bill of lading and that Express Hound accepted those goods at its facility in Ridgefield, New Jersey. D.E. 1-2 ¶¶ 6, 7. These two factual allegations suggest that Express Hound may have acted as carrier during this particular transaction. See 49 U.S.C. § 14706(a)(1) (“A carrier providing transportation or service . . . shall issue a receipt or bill of landing for property it receives for transportation under [*10]  this part. That carrier and any other carrier that delivers the property and is providing transportation or service . . . are liable to the person entitled to recover under the receipt or bill of landing.”). While the Plaintiff’s complaint suggests that Express Hound also provided “broker”-related services to Plaintiff — including with respect to the transaction underlying this lawsuit² — the Court is not in a position, at this time, to definitively rule on the “inherently fact intensive” issue of whether Express Hound’s role in this particular transaction was limited to that of a broker. It will accordingly decline to dismiss Express Hound from this action with prejudice at this time.

Finally, Plaintiff avers that in the event the Court determines that dismissal of its complaint is appropriate (which, for the reasons discussed above, it does so find), then Plaintiff “must be granted leave to amend its Complaint to pursue its claims under the Carmack Amendment.” D.E. 5 at 5. The Court agrees. Plaintiff will be afforded the opportunity to amend its complaint to address the pleading deficiencies identified herein. Leave to amend a pleading “shall be freely given when justice so requires.” Fed. R. Civ. P. 15(a); see also Foman v. Davis, 371 U.S. 178, 182, 83 S. Ct. 227, 9 L. Ed. 2d 222 (1962). [*11]  There has been no prior dismissal of the complaint, Plaintiff has not previously amended its pleadings, and Express Hound has not demonstrated that it would be prejudicial, futile, or otherwise unfair for Plaintiff to be given leave to amend. It is consistent with principles of fairness and justice to afford Plaintiff an opportunity to do so. Plaintiff may file an amended complaint within 90 days of the date of this Opinion.

IV. CONCLUSION

For the reasons above, Freight Connections motion to dismiss (D.E. 3) is GRANTED. Plaintiff is afforded 90 days to file an amended complaint to address the pleading deficiencies identified herein. An appropriate order follows.

Dated: October 27, 2022

/s/ Evelyn Padin

Evelyn Padin, U.S.D.J.

ORDER

Evelyn Padin, U.S.D.J.

For the reasons expressed in the accompanying Opinion, and for good cause shown,

IT IS on this 27th day of October 2022,

ORDERED, that Defendant Express Hound, LLC’s motion to dismiss Plaintiff Freight Connections, Inc.’s complaint, in its entirety, pursuant Rule 12(b)(6) of the Federal Rules of Civil Procedure (at D.E. 3) is GRANTED; and it is further

ORDERED that Plaintiffs complaint is DISMISSED; and it is further

ORDERED, that the Clerk is directed to CLOSE this action; and it is further

ORDERED [*12] , that Plaintiff is afforded 90 days to file an amended complaint which addresses the pleading deficiencies identified in the accompanying Opinion; and it is further

ORDERED, that upon Plaintiffs filing of the same, the Clerk will be directed to RE-OPEN this matter.

/s/ Evelyn Padin

Evelyn Padin, U.S.D.J.

End of Document

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¹ For the purposes of this Opinion, the Court accepts as true all of the Complaint’s well-pled factual allegations.

² The Court recognizes that if Freight Connections is ultimately found to be nothing other than a “broker” in the transaction at issue, it would have other claim preclusion defenses available to it under the Federal Aviation Administration Authorization Act (“FAAAA”), 49 U.S.C. § 14501(c)(1). In light of the Court’s current rulings, however, no further discussion on this point is required at this time.

United States District Court for the Southern District of Florida

October 27, 2022, Decided; October 28, 2022, Entered on Docket

CASE NO. 1:21-cv-22943-JLK

Reporter

2022 U.S. Dist. LEXIS 196684 *

BERELI, INC., Plaintiff, v. R&L CARRIERS, INC.; R&L TRUCKLOAD SERVICES; and R&L GLOBAL LOGISTICS, Defendants.

Core Terms

carrier, shipment, bill of lading, summary judgment motion, summary judgment, shipper, notice, affirmative defense, cargo, notice of claim, limitation of liability, damages, ammunition, transport, flat rate, argues, levels

Counsel:  [*1] For Bereli Inc., Plaintiff: Andrew Robert Spector, Marc Alan Rubin, LEAD ATTORNEYS, Spector Rubin P.A., Miami, FL.

For R & L Carriers Inc., R & L Global Logistics, R & L Truckload Services, Defendants: Steven Craig Jones, Wilson Elser Moskowitz Edelman & Dicker, Miami, FL; Anthony Peter Strasius, LEAD ATTORNEY, Wilson Elser, Miami, FL.

Judges: JAMES LAWRENCE KING, UNITED STATES DISTRICT JUDGE.

Opinion by: JAMES LAWRENCE KING

Opinion

ORDER GRANTING IN PART PLAINTIFF’S MOTION FOR SUMMARY JUDGMENT AND DENYING DEFENDANTS’ MOTION FOR SUMMARY JUDGMENT

THIS CAUSE comes before the Court upon Plaintiff’s Motion for Summary Judgment (“Plaintiffs Motion”) (DE 20), filed September 6, 2022, and Defendants’ Motion for Summary Judgment (“Defendants’ Motion”) (DE 21), also filed September 6, 2022. The Court has also considered Defendants’ Response (DE 23), Plaintiff’s Response (DE 22), and Plaintiff’s Reply (DE 24). Additionally, the Court has considered the Parties’ respective Statements of Undisputed Facts. (DE 20-1, 21 at 1, 22-1).¹ The Court being otherwise fully advised finds that Plaintiff’s Motion is granted in part and Defendants’ Motion is denied for the reasons stated herein.

I. BACKGROUND

On July 12, 2021, Plaintiff filed its Complaint in the 11th Judicial Circuit in and for Miami-Dade County, Florida alleging breach of contract (Count I) and violation of the federal Carmack Amendment, 49 U.S.C. § 14706 et seq. (Count II) stemming from damages to Plaintiff’s shipment of ammunition sustained during transport by Defendants. See Compl., DE 1-1 at 4. On August 12, 2021, Defendants timely removed this case to federal court alleging federal question jurisdiction. See Not. of Removal, DE 1 at 3. Under the Court’s operative Scheduling Order, discovery has concluded and the instant pending Cross-Motions for summary judgment were timely filed on the last day of motion practice. DE 8. The final pretrial conference is set for November 4, 2022, and trial set for January 3, 2023. Id.

The following facts are undisputed:

In April 2021, Plaintiff engaged the Defendants to transport a shipment of ammunition from Hollywood, Florida to Inglewood, California. DE 20-1 ¶ 1. On April 21, 2021, the shipment of ammunition was tendered to Defendants in good condition. Id. ¶ 13. On the same day, a bill of lading was generated and provided to Plaintiff. DE 21 at 1; DE 20-1 ¶ 9. On April 23, 2021, Plaintiff was notified that the [*3]  truck shipping the ammunition was involved in an accident and overturned resulting in damages to the freight. DE 20-1 ¶ 14; DE 21 ¶ 4. After the loss, Aaron Gheblikian, Vice President of Sales for Plaintiff, discovered no insurance was placed on the shipment by Defendant’s employee Darius Hamby, who was subsequently terminated by Defendant R&L Carriers. DE 20-1 ¶ 15-16. On May 4, 2021, Plaintiff submitted a written notice of loss to which Defendant never responded. DE 20-1 ¶ 17.²

II. LEGAL STANDARD

Summary judgment is appropriate where there is “no genuine issue as to any material fact and [] the moving party is entitled to judgment as a matter of law.” Fed. R. Civ. P. 56(a); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). An issue is genuine if a reasonable jury could return a verdict for the nonmoving party. Mize v. Jefferson City Bd. of Educ., 93 F.3d 739, 742 (11th Cir. 1996). A fact is material if it may affect the outcome of the case under the applicable substantive law. Allen v. Tyson Foods, Inc., 121 F.3d 642, 646 (11th Cir. 1997).

If a reasonable fact finder could draw more than one inference from the facts, creating a genuine issue of material fact, summary judgment should not be granted. Samples ex rel. Samples v. City of Atlanta, 846 F.2d 1328, 1330 (11th Cir. 1988). The moving party has the burden of establishing both the absence of a genuine issue of material fact and that it is entitled to judgment as a matter of law. See Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 586-87, 106 S. Ct. 1348, 89 L. Ed. 2d 538 (1986). On a motion for summary [*4]  judgment, the court views the evidence and all reasonable inferences in the light most favorable to the non-moving party. Davis v. Williams, 451 F.3d 759, 763 (11th Cir. 2006).

III. DISCUSSION

“The Carmack Amendment governs the liability of domestic common carriers when goods are shipped in interstate commerce.” Hanover Ins. Co. v. HMR Trucking Servs. Corp., No. 18-cv-22397-CMA, 2018 U.S. Dist. LEXIS 219081, at *5 (citing Smith v. United Parcel Serv., 296 F.3d 1244, 1246 (11th Cir. 2002)) (other citations omitted). “When a shipper shows delivery of goods to a carrier in good condition and non-delivery or delivery in a damaged condition, there arises a prima facie presumption of liability.” Hanover Ins. Co, 2018 U.S. Dist. LEXIS 219081, at *5 (quoting UPS Supply Chain Sols., Inc. v. Megatrux Transp., Inc., 750 F.3d 1282, 1285-86 (11th Cir. 2014)). Under the Carmack Amendment, common carriers are strictly liable for all damages resulting from the failure to deliver cargo in the same condition in which they were received. Hanover Ins. Co, 2018 U.S. Dist. LEXIS 219081, at *5 (citing Megatrux Transp., Inc., 750 F.3d at 1285). Before the Court are the Parties’ Cross-Motions for summary judgment. The pending Motions will be addressed in the order they appear on the docket sheet.

A. Plaintiff’s Motion for Summary Judgment

Plaintiff seeks summary judgment on Defendants’ affirmative defenses 2, 3, and 4 and moves this Court to strike these defenses. “On a plaintiff’s motion for summary judgment, the defendant bears the initial burden of showing that the affirmative defense[s] [are] applicable.” Special Purpose Accounts Receivable Coop. Corp. v. Prime One Capital Co., LLC, 125 F. Supp. 2d 1093, 1098-99 (S.D. Fla. 2000) (citations omitted). “Only upon such a showing does the burden shift to the plaintiff [*5]  regarding the affirmative defense.” Id. at 1099 (citation omitted). “Summary judgment is therefore appropriate when the defendant fails to come forward with evidence sufficient to dispute an element of the plaintiff’s case or to support an affirmative defense.” Id. (citation omitted).

1. Limitation of Liability

Affirmative defenses 2 and 3 deal with limitation of liability:

2. R+L Global and R+L Truckload plead Carmack Amendment liability limitations.

3. R+L Global and R+L Truckload plead all limitations of liability in whole or in part, to the extent applicable, included in any bill of lading or other contract that arises out of, relates to, or otherwise concerns the involved cargo shipment.

Defs. Answer, DE 7 at 4. Plaintiff argues that Defendants are not entitled to limitation of liability because Defendants rely on air waybill terms and conditions “which were never provided to Plaintiff, and which admittedly would not have been applicable to this type of transaction.” DE 20 at 9. Plaintiff also argues that the bill of lading used here indicated it was “a) a flat rate shipment, and b) a full value declared — replacement cost shipment” and that there was no opportunity to choose between two or more levels of liability [*6]  thus prohibiting limitation of liability under the Carmack Amendment. DE 20 at 10.

In their Response, Defendants do not make any counter arguments regarding these affirmative defenses. See DE 23. Instead, Defendants only provide the same argument made in their Motion for Summary Judgment (DE 21), that Plaintiff failed to submit a notice of claim to the appropriate carrier R+L Truckload so the instant lawsuit is premature. DE 23 at 3.

In this Circuit, the Carmack Amendment requires a carrier to meet a four-part test to limit its liability: a carrier must (1) maintain a tariff within the prescribed guidelines of the Interstate Commerce Commission, (2) give the shipper a reasonable opportunity to choose between two or more levels of liability, (3) obtain the shipper’s agreement as to the choice of liability, and (4) issue a receipt or bill of lading prior to moving the shipment. Atl. Specialty Ins. Co. A.S. v. Digit Dirt Worx, Inc., 793 Fed. App’x. 896, 903 (11th Cir. 2019) (citations omitted). “Notwithstanding the amendments to the Carmack Amendment, a carrier wishing to limit its liability is still required to give the shipper a reasonable opportunity to choose between different levels of liability.” Sassy Doll Creations, Inc. v. Watkins Motor Lines, Inc., 331 F.3d 834, 842 (11th Cir. 2003).

Plaintiff specifically states that it was never advised as to the application of the terms on the bill of lading [*7]  or otherwise, and there was no opportunity to choose between two or more levels of liability because it was a flat rate shipment and full value was declared. DE 20 at 10. Aaron Gheblikian, Vice President of Sales for Plaintiff Bereli, Inc., declared under oath that a bill of lading was electronically forwarded via e-mail to Plaintiff, however there were no terms and conditions on the reverse side. DE 20-2 ¶ 14. Gheblikian further stated that “[t]he bill of lading requires a specific disclosure of the value of the property only where the rate is dependent upon value . . . [h]owever, the instant rate was a flat rate, not dependent upon value.” Id. ¶¶ 15-16.

Tracy Harper, Vice President of Business Improvement of R&L Global Logistics, testified that Defendant R&L Truckload prepared the bill of lading but its employee, Darius Hamby, failed to submit an e-mail for approval through Defendant’s value shipment program breaking company policy. DE 20-3 at 24:13-25:21. Harper further testified that if Darius Hamby reported the value of the shipment the rate would not have changed, and that R&L Truckload does not necessarily quote anything besides flat rates. Id. at 27:10-19, 23:10-19.

The Court [*8]  finds that the evidence shows that Defendants never offered a choice of rates, but rather the bill of lading applied a flat rate. Because there was no reasonable opportunity to choose between two or more levels of liability, Defendants may not rely on their affirmative defenses of limitation of liability. Defendants have not offered any evidence as to why their limited liability affirmative defenses are applicable, therefore summary judgment in favor of Plaintiff on these affirmative defenses is appropriate.

2. Notice of Claim

Plaintiff also seeks summary judgment on Defendants’ fourth affirmative defense regarding notice of claim: “R+L Global and R+L Truckload are not subject to liability under the Carmack Amendment insofar as Plaintiff failed to meet conditions precedent regarding claims submission.” DE 7 at 4. In response, Defendants state that they address this single issue in their briefing of Defendants’ Motion for Summary Judgment. See DE 23 at 3 n.2. Therefore, the issue of notice will be analyzed by the Court in the section below entitled “Defendants’ Motion for Summary Judgment.” See infra Section B.

3. Plaintiff’s Motion for Summary Judgment on its Affirmative Case

The Carmack Amendment to the [*9]  Interstate Commerce Act imposes strict liability on common carriers “for actual loss of or damage to shipments in interstate commerce.” A.I.G. Uru. Compania de Seguros, S.A. v. AAA Cooper Transp., 334 F.3d 997, 1003 (11th Cir. 2003). To establish a prima facie case under the Carmack Amendment, plaintiff must prove “by a preponderance of the evidence that (1) the goods were delivered to the carrier in good condition, (2) the goods arrived at the destination in damaged condition, and (3) a specified amount of damages resulted.” Id. (citing Fine Foliage of Fla., Inc. v. Bowman Transp., Inc., 901 F.2d 1034, 1037 (11th Cir. 1990)). If a prima facie case is established, the burden then “shifts to the carrier to prove (1) that it was free from negligence, and (2) that the damage to the cargo was caused by one of the five excusable factors: ‘(a) the act of God; (b) the public enemy; (c) the act of the shipper himself; (d) public authority; (e) or the inherent vice or nature of the goods.'” Id. If the carrier is unable to meet this burden, then the carrier is held liable. Id.

The evidence on discovery establishes that the goods, a shipment of ammunition, were delivered to the carrier in good condition. Sworn testimony and Defendants’ admission demonstrate that on April 21, 2021, the shipment was tendered in good order and condition to the care, custody and control of the R&L Defendants.  [*10] See Gheblikian Decl., DE 20-2 at ¶ 18; Defs. Answer, DE 7, ¶ 22 (admitting “that cargo was tendered for pickup in good order and condition”). Plaintiff has also proved that the ammunition arrived at the destination in damaged condition. The evidence presented shows that on or about April 23, 2021, the truck containing the cargo was involved in an accident where the truck overturned, resulting in damages to the freight. See Gheblikian Decl., DE 20-2 at ¶ 19; See Harper Dep. at 65. Also, as submitted to Defendant R&L Carriers in Plaintiffs Notice of Loss, there was a specified amount of damages, the value of the shipment for $711,800.00 plus the costs of mitigation for a total demand for $761,800.00. See 20-2 at 10-11. Defendants have not presented any evidence disputing Plaintiff’s prima facie case for violation of the Carmack Amendment, therefore summary judgment as to Count II shall be GRANTED.

4. Breach of Contract

Plaintiff, in its Response, argues that Defendants’ Motion for Summary Judgment fails to address Count I of the Complaint for breach of contract. See DE 22 at 9-10. Plaintiff further argues that even if R&L Carriers did not act as a Carmack carrier it still is responsible for breaching the [*11]  instruction to insure the shipment. Id.

Although, Defendants have not made any argument as to the breach of contract claim, the Eleventh Circuit has characterized “the preemptive effect of the Carmack Amendment to be quite broad.” Megatrux Transp., Inc., 750 F.3d at 1289. “The Carmack Amendment embraces all losses resulting from any failure to discharge a carrier’s duty as to any part of the agreed transportation.” Id. (internal quotation omitted). “[S]eparate and distinct conduct rather than injury must exist for a claim to fall outside the preemptive scope of the Carmack Amendment.” Id.

Here, both Count I for breach of contract and Count II for violation of the Carmack Amendment are based on the same conduct, Defendants’ failure to deliver goods in the same condition as they were tendered and failure to procure appropriate insurance. See DE 1-1 ¶¶ 22-23. Because there is no evidence as to separate and distinct conduct, Count I is DISMISSED as preempted by Count II.

B. Defendants’ Motion for Summary Judgment

Defendants make one argument for summary judgment—that this case is premature because Plaintiff failed to satisfy the statutory condition precedent of submitting a claim to the proper carrier to evaluate the loss. See DE 21. Defendants cite a single case, Siemens, which held that “a shipper must [*12]  file with the carrier a notice of a claim that satisfies § 1005.2(b) before filing suit under the Carmack Amendment.” Id. at 3 (citing Siemens Power Transmission & Distribution v. Norfolk & S. Ry., 420 F.3d 1243, 1245 (11th Cir. 2005)). Plaintiff argues that there is no notice requirement per se under the Carmack Amendment, and distinguishes Siemens, stating the Eleventh Circuit only dealt with the issue of “provisions relating to restrictions on carriers in setting notice of claim time periods.” DE 22 at 8 (citing Siemens, 420 F.3d at 1248).

Indeed, § 1005.2(b) contains minimum filing requirements:

A written or electronic communication (when agreed to by the carrier and shipper or receiver involved) from a claimant, filed with a proper carrier within the time limits specified in the bill of lading or contract of carriage or transportation and: (1) Containing facts sufficient to identify the baggage or shipment (or shipments) of property, (2) asserting liability for alleged loss, damage, injury, or delay, and (3) making claim for the payment of a specified or determinable amount of money, shall be considered as sufficient compliance with the provisions for filing claims embraced in the bill of lading or other contract of carriage; Provided, however, That where claims are electronically handled, procedures are established to ensure reasonable carrier access to supporting [*13]  documents.

The Eleventh Circuit also found “that § 1005.2(b) should be interpreted liberally in light of its purpose, which is to provide the carrier adequate notice of the claim so that it can conduct an independent investigation of the damage, not to relieve the carrier of liability.” Siemens, 420 F.3d at 1245.

Regarding timing of submitting notice of loss, Section (e) of the Carmack Amendment provides that “[a] carrier may not provide by rule, contract, or otherwise, a period of less than 9 months for filing a claim against it under this section and a period of less than 2 years for bringing a civil action against it under this section.” Id. at 1248 (citing 49 U.S.C. § 14706(e). In Siemens, the uniform straight bill of lading required that, consistent with Section (e), the shipper must provide the carrier with a notice of claim for damages within nine months of delivery of the cargo as a condition precedent to recovery. Id. (citation omitted).

Here, the bill of lading did not have any terms and conditions on the reverse side. 20-2 ¶ 14. Plaintiff supplied notice of the claim to Defendant R&L Carriers via email on May 4, 2021, only 11 days after the subject loss. See id. at 10. Further, Defendants never denied the May 4, 2021, claim in violation of § 370.5. See 49 CFR 370.5(a) (“Each carrier shall, upon [*14]  receipt in writing of a proper claim in the manner and form described in the regulations in the past, acknowledge the receipt of such claim in writing to the claimant within 30 days after the date of its receipt by the carrier unless the carrier shall have paid or declined such claim in writing within 30 days of the receipt thereof.”). As such, the Court finds that Plaintiff submitted timely notice.

Additionally, Defendants argue that “Plaintiff never filed a claim with R+L Truckload, who is the ‘proper’ carrier engaged by [Plaintiff], issued the bill of lading, and brokered to a delivering carrier to transport the cargo.” DE 21 at 4 (footnote omitted). Plaintiff responds that the entity it sent notice to, R&L Carriers, was the initial carrier of the shipment and the proper entity to receive notice of the subject loss.

Section 1005.2(b) requires a communication be “filed with a proper carrier within the time limits specified in the bill of lading or contract of carriage or transportation . . . .” (emphasis added). Here, the evidence shows that Plaintiff contacted R&L Carriers to obtain a quote for this shipment. DE 20-2 ¶ 6. Also “R&L Carriers” is in the heading of the bill of lading for the shipment [*15]  in question. See 24-1. It is true, Defendant’s corporate representative testified that R&L Truckload generated the bill of lading. DE 20-3 at 16:21-24, 24:13-16. However, Defendants’ corporate representative also testified that she was not sure whether Plaintiff was ever informed that R&L Truckload was a subsidiary or related company. DE 20-3 at 61:22-25.

By its terms, the Carmack Amendment governs carriers, not brokers. 49 U.S.C. § 14706(a). “Whether a company is a broker or a carrier is not determined by what the company labels itself, but by how it represents itself to the world and its relationship to the shipper.” Hewlett-Packard Co. v. Brother’s Trucking Enterprises, Inc., 373 F. Supp. 2d 1349, 1352 (S.D. Fla. 2005) (citation omitted). “This is necessarily a case-specific analysis, and as a result, summary judgment might not be appropriate in many cases.” Essex Ins. Co. v. Barrett Moving & Storage, Inc., 885 F.3d 1292, 1302 (11th Cir. 2018) (citation omitted). “But the question need not always be difficult.” Id. “In any case, the operative inquiry is this: pursuant to the parties’ agreement, with whom did the shipper entrust the cargo?” Id.

In April of 2021, Aaron Gheblikian contacted Ann Shuster of R&L Carriers to obtain a quote for the shipment in question. DE 20-2 at ¶ 6. Plaintiff had previously done business with Ann Shuster and prior to the underlying accident R&L Carriers had performed motor carrier [*16]  services for plaintiff. Id, ¶ 7. In light of the evidence submitted, the Court finds that Plaintiff entrusted its cargo to R&L Carriers because R&L Carriers held themselves out to be the carrier. Defendants’ corporate representative acknowledged that a claim was submitted to R&L Carriers. Harper Dep. DE 20-3 at 63:24-64:3. Therefore, Plaintiff submitted its notice of loss to the proper entity and satisfied the pre-suit notice of claim requirement pursuant to § 1005.2(b).

Accordingly, it is ORDERED, ADJUDGED, AND DECREED as follows:

1) Plaintiff’s Motion for Summary Judgment (DE 20) be, and the same is, hereby GRANTED IN PART as to Count II for violation of the Carmack Amendment;

2) Count I for breach of contract is DISMISSED as preempted by Count II;

3) Defendants’ Motion for Summary Judgment (DE 21) is hereby DENIED; and

4) Pursuant to Rule 58(a) of the Federal Rules of Civil Procedure, final judgment in favor of Plaintiff will be set out in a separate Order.

DONE AND ORDERED in Chambers at the James Lawrence King Federal Justice Building and United States Courthouse, Miami, Florida this 27th day of October, 2022.

/s/ James Lawrence King

JAMES LAWRENCE KING

UNITED STATES DISTRICT JUDGE

ORDER OF FINAL JUDGMENT

Pursuant to Federal Rule of Civil Procedure 58(a), and in accordance with the reasoning stated in [*17]  the Court’s Order Granting in Part Plaintiff’s Motion for Summary Judgment (DE 25), it is hereby ORDERED, ADJUDGED, and DECREED that FINAL JUDGMENT is entered in favor of Plaintiff and against Defendant. The above-captioned case is hereby DISMISSED. All pending motions are DENIED as moot. The Pretrial Conference set for November 4, 2022, and Trial set for January 3, 2023, are hereby CANCELED. The Court retains jurisdiction to consider motions regarding fees and costs (if any are filed). The Clerk shall CLOSE this case.

DONE AND ORDERED in Chambers at the James Lawrence King Federal Justice Building and United States Courthouse, Miami, Florida, this 27th day of October, 2022.

/s/ James Lawrence King

JAMES LAWRENCE KING

UNITED STATES DISTRICT JUDGE

End of Document

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¹ The Court will consider the Parties’ Statements of Undisputed Facts despite both Plaintiff and Defendants failing to adhere to Local Rule Local Rule 56.1(a) which requires that “[a] motion for summary judgment and the opposition to it shall each be accompanied by a separate and contemporaneously filed and served Statement of Material Facts.” S.D. Fla. L.R. 56.1(a). Also, under subsection (b) the form the Statements of Material Facts are to take is that “[a]ll statements of Material Facts (whether filed by the movant or the opponent) shall be filed and served as separate documents and not as exhibits or attachments [*2] .” S.D. Fla. L.R. 56.1(b)(1) (emphasis added).

² Defendants do not dispute the existence of this communication but rather argue in their Motion for Summary Judgment (DE 21) and Response to Plaintiff’s Motion for Summary Judgment (DE 23) that the communication was sent to the wrong entity, creating a dispute of law, not fact.