JOSEPH LAWRENCE VERSUS ROCKTENN CP, LLC, ET AL.

 

CIVIL ACTION NO. 16-0821

 

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF LOUISIANA, MONROE DIVISION

 

2017 U.S. Dist. LEXIS 78360

 

 

May 22, 2017, Decided

May 22, 2017, Filed

 

 

COUNSEL:  [*1] For Joseph Lawrence, Plaintiff, Intervenor Defendant: Louis V Champagne, LEAD ATTORNEY, McKeithen Ryland et al, Columbia, LA; Michael J Mestayer, Law Office of Michael J Mestayer, New Orleans, LA.

 

For WestRock C P L L C, formerly known as RockTenn C P L L C, Defendant: David M Bienvenu, Jr, LEAD ATTORNEY, Patrick Hayes Hunt, Bienvenu Bonnecaze et al, Baton Rouge, LA; Lexi Trahan Holinga, Bienvenu Bonnecaze et al, Baton Rouge, LA.

 

For Q B E Insurance Co, Intervenor Plaintiff: David H Nelson, LEAD ATTORNEY, Nelson Zentner et al, Monroe, LA.

 

For WestRock Services Inc, formerly known as Rock-Tenn Services Inc, WestRock C P L L C, Intervenor Defendants: David M Bienvenu, Jr, LEAD ATTORNEY, Patrick Hayes Hunt, Bienvenu Bonnecaze et al, Baton Rouge, LA; Lexi Trahan Holinga, Bienvenu Bonnecaze et al, Baton Rouge, LA.

 

JUDGES: ROBERT G. JAMES, UNITED STATES DISTRICT JUDGE. MAG. JUDGE KAREN L. HAYES.

 

OPINION BY: ROBERT G. JAMES

 

OPINION

 

RULING

This is a premises liability diversity case in which Plaintiff Joseph Lawrence (“Lawrence”) alleges he was injured when his truck struck a pothole on the property of Defendants WestRock CP, LLC and WestRock Services, Inc. (“WestRock”). Pending before the Court is WestRock’s Motion for Summary [*2]  Judgment. [Doc. No. 26].

For the following reasons, WestRock’s Motion for Summary Judgment is GRANTED.

 

1. FACTS AND PROCEDURAL HISTORY

WestRock is the owner and operator of a paper mill in Hodge, Louisiana. [Doc. No. 34, p. 5]. WestRock contracted with Plum Creek Timber for the purchase of timber products. Plum Creek, in turn, contracted with various trucking companies, such as Lawrence’s employer, Triple T Logging, LLC, to transport the timber products from Plum Creek’s land to the Hodge mill. Id; [Doc. Nos. 1-2; 1-3].

On May 14, 2015, Lawrence was delivering a load of timber to WestRock’s Hodge mill when his truck struck a pothole in the road, causing him to bounce up and hit his head on the ceiling of the cab. [Doc. No. 26-3, p. 10]. Lawrence had previously made deliveries to the WestRock mill and was on his second delivery of the day when he struck the pothole. [Doc. No. 30, p. 23]. WestRock nurse Shontae Mims responded to the scene with Emergency Medical Technician Shane Sullivan. [Doc. No. 26-9]. Emergency services were called and he was taken to the hospital. Id. At the time of the incident, Lawrence was wearing his hard hat, but not wearing his seat belt, and was in the process [*3]  of putting his scale ticket in his visor. [Doc. No. 26-3, pp. 11; 20-21].

Lawrence was injured on the wood yard road, which provides the only means for drivers to deliver timber to the mill. [Doc. No. 30, p. 8]. WestRock’s records show that thirty-five other drivers delivered timber to the Hodge mill on May 14, 2015, traveling the same road as Lawrence, before the incident. Id.; [Doc. No. 26-8, p. 3].

Lawrence filed this lawsuit against WestRock in Louisiana state court seeking damages. [Doc. No. 1]. Lawrence’s employer’s worker’s compensation carrier, QBE Insurance Company (“QBE”), intervened and named WestRock Services, Inc., as a defendant, asserting rights to recover the amount paid to him pursuant to the Louisiana Workers’ Compensation Act. [Doc. No. 1-3]. WestRock then removed the matter to this Court. [Doc. No. 1].

On April 7, 2017, WestRock filed the instant Motion for Summary Judgment [Doc. No. 26], arguing that Lawrence is unable to prove that an unreasonably dangerous condition existed and that WestRock had actual or constructive knowledge of the dangerous condition under Louisiana premises liability law. On April 19, 2017, Lawrence filed a memorandum in opposition [Doc. No. [*4]  34], and Intervener QBE filed an opposition adopting Lawrence’s memorandum in opposition. [Doc. No. 35]. On May 3, 2017, WestRock replied. [Doc. No. 37]. The Court is now prepared to rule.

 

1. LAW AND ANALYSIS

 

1. Standard of Review

Under Federal Rule of Civil Procedure 56, summary judgment “should be rendered if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law.” FED. R. CIV. P. 56(c)(2). The moving party bears the initial burden of informing the court of the basis for its motion by identifying portions of the record which highlight the absence of genuine issues of material fact. Topalian v. Ehrman, 954 F.2d 1125, 1132 (5th Cir. 1992). A fact is “material” if proof of its existence or nonexistence would affect the outcome of the lawsuit under applicable law in the case. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986). A dispute about a material fact is “genuine” if the evidence is such that a reasonable fact finder could render a verdict for the nonmoving party. Id.

If the moving party can meet the initial burden, the burden then shifts to the nonmoving party to establish the existence of a genuine issue of material fact for trial. Norman v. Apache Corp., 19 F.3d 1017, 1023 (5th Cir. 1994). In evaluating the evidence tendered by the parties, the Court [*5]  must accept the evidence of the nonmovant as credible and draw all justifiable inferences in its favor. Anderson, 477 U.S. at 255. However, “a party cannot defeat summary judgment with conclusory allegations, unsubstantiated assertions, or only a scintilla of evidence. Thus, Summary Judgment is appropriate if a reasonable jury could not return a verdict for the nonmoving party.” Turner v. Baylor Richardson Med. Ctr., 476 F.3d 337, 343 (5th Cir. 2007) (citing Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S. Ct. 2505, 91 L. Ed. 2d 202 (1986)).1

 

1   Because the Court is sitting in diversity, the Court applies the substantive law of Louisiana, the forum state. See, e.g., Holt v. State Farm Fire & Cas. Co., 627 F.3d 188, 191 (5th Cir. 2010) (citing Erie R. Co. v. Tompkins, 304 U.S. 64, 58 S. Ct. 817, 82 L. Ed. 1188 (1938)).

 

1. Premises Liability

Lawrence asserts that WestRock was negligent in (1) failing to properly warn of the dangerous condition, (2) failing to block access to the dangerous condition, and (3) failing to repair the dangerous condition. [Doc. No. 1-2, p. 3]. WestRock’s Motion for Summary Judgment asserts that the pothole was not a dangerous condition as a matter of law. [Doc. No. 26].

In Louisiana, the owner or custodian of immovable property has a duty to keep his property in a reasonably safe condition. He must discover any unreasonably dangerous condition on his premises and either correct the condition or warn potential victims of its existence. Pryor v. Iberia Parish School Board, 101683, p. 3 (La. 3/15/11); 60 So.3d 594, 596. The basis for such delictual liability is established in Louisiana Civil Code articles 2315, 2317 and 2317.1.2 Granda v. State Farm Mutual Ins. Co., 04-1722, p. 5 (La. App. 1st Cir. 2/10/06); 935 So.2d 703, 707-08, writ denied, 06-0589 (La. 5/5/06); 927 So.2d 326.

 

2   Louisiana Civil Code article 2317.1 provides, in relevant part:

 

The owner or custodian of a thing [*6]  is answerable for damage occasioned by its ruin, vice, or defect, only upon a showing that he knew or, in the exercise of reasonable care, should have known of the ruin, vice, or defect which caused the damage, that the damage could have been prevented by the exercise of reasonable care, and that he failed to exercise such reasonable care. Nothing in this Article shall preclude the court from the application of the doctrine of res ipsa loquitur in an appropriate case.

 

 

In order to recover, Lawrence must establish that (1) WestRock was the owner or custodian of the road; (2) the road contained a defect, i.e., a condition that created an unreasonable risk of harm; (3) the unreasonably dangerous condition caused him injuries; (4) WestRock had actual or constructive notice of the condition; (5) his injuries could have been prevented by the exercise of reasonable care; and (6) WestRock breached its duty of reasonable care.3 See Granda 935 So.2d at 708; see also Poindexter, 244 Fed. Appx. at 564; see also Teel v. State, Dept. of Transp. and Development, No. 96-CA-0592 (La.10/15/96); 681 So.2d 340, 343.

 

3   Although Plaintiff attempts to differentiate his cause of action under a theory of general negligence under LA CIV. CODE art 2315 and strict liability under LA. CIV. CODE arts. 2317 and 2317.1, under either article, the plaintiff “must prove that the [thing] was within the defendant’s custody, that it contained a defect that presented an unreasonable risk of harm to others, and that the defendant knew or should have known of the defect.” See Poindexter v. U.S., No. 06-30529, 244 Fed. Appx. 561, 564 (5th Cir. 2007). The Louisiana Supreme Court has recognized that, with the adoption of LA. CIV.CODE art. 2317.1 to require knowledge or constructive knowledge, “the Legislature effectively eliminated strict liability under Article 2317, turning it into a negligence claim.” See Burmaster v. Plaquemines Parish Gov’t, 2007-2432 (La. 5/21/08), 982 So.2d 795, 814 n. 1. Before the repeal of strict liability, the Supreme Court of Louisiana wrote, “[t]he plaintiff asserting a claim against a premises owner based on negligence, or liability under LA. C.C. art. 2315, where the sole basis alleged for holding the owner liable is his relation to the property, has the same burden (as under Article 2317), plus the additional burden of proving defendant’s scienter, i.e., that defendant ‘knew or should have known’ of the defect.” Fontenot v. Fontenot, 635 So.2d 219, 221 (La. 1994).

 

1. Unreasonably Dangerous Condition

WestRock argues that Lawrence’s claim fails as a matter of law because the alleged pothole did not present an unreasonably dangerous condition. [Doc. No. 26-1, p. 9]. The existence of a duty is decided [*7]  as a matter of law by the court; the absence of an unreasonably dangerous condition necessarily implies the absence of a duty on the part of the defendant. Leonard v. Ryan’s Family Steak Houses, Inc., 2005-0775 (La. App. 1 Cir. 6/21/06); 939 So. 2d 401, 405 (citing Oster v. Dep’t of Transp. and Dev., 582 So.2d 1285, 1288 (La. 1991)).

Louisiana courts treat the unreasonable risk inquiry as a mixed question of law and fact. See, e.g., Broussard v. State ex rel. Office of State Bldgs., 2012-1238 (La. 4/5/13); 113 So. 3d 175, 183; Jeansonne v. South Cent. Bell Tel. Co., 08-568, p. 10 (La. App. 5 Cir. 1/13/09); 8 So.3d 613, 620; Wiley v. Sanders, 34,923, p. 7 (La. App. 2 Cir. 8/22/01); 796 So.2d 51, 56, writ denied, 01-2661 (La. 1/11/02); 807 So.2d 235. Unsurprisingly, because premises liability cases are naturally fact intensive and nuanced, whether a condition constitutes an unreasonably dangerous condition is generally a question of fact for the jury; however, in some circumstances, it is the court’s obligation to decide as a matter of law which risks are unreasonable. See Allen v. Lockwood, 156 So.3d 650, 653 (La. 2015) (per curiam).4

 

4   Lawrence asserts that summary judgment on this issue is inappropriate, because the Louisiana Supreme Court held in Broussard that “whether a risk is unreasonable, whether the utility is outweighed by other considerations, or whether a condition is open and obvious, are decisions for the jury . . . .” [Doc. No. 34, p. 22]. However, a year later the Louisiana Supreme Court clarified that “[w]e note that our opinion in Broussard v. State ex rel. Office of State Buildings, supra, should not be construed as precluding summary judgment when no legal duty is owed because the condition encountered is obvious and apparent to all and not unreasonably dangerous.” Bufkin, 171 So. 3d at 859 n. 3

For a condition to create an unreasonable risk of harm, it must be reasonably foreseeable that the condition would cause injury to an individual exercising ordinary care under the circumstances. Durmon, 873 So. 2d at 876. If the “risk of harm is obvious, universally known and easily avoidable, the risk is not unreasonable.” Trice v. Isaac, 99-839 (La. App. 5 Cir. 2/16/00); 759 So. 2d 843, 847, writ denied, 2000-1113 (La. 6/2/00); 763 So. 2d 600. Id. at 877. Additionally, to aid the court in making the determination of whether a condition is unreasonably dangerous, Louisiana has adopted the risk-utility test, wherein the court “must balance the gravity and risk of harm against individual [*8]  societal rights and obligations, the social utility of the thing, and the cost and feasibility of repair.” Broussard, 113 So. 3d at 184.

The Louisiana Supreme Court has synthesized the risk-utility balancing test to a consideration of four pertinent factors: “(1) the utility of the complained-of condition; (2) the likelihood and magnitude of harm, including the obviousness and apparentness of the condition; (3) the cost of preventing the harm; and (4) the nature of the plaintiff’s activities in terms of social utility or whether the activities were dangerous by nature.” Bufkin v. Felipe’s La., LLC, 2014-0288 (La. 10/15/14), 171 So. 3d 851, 859 (citing Broussard, 113 So. 3d at 184). When the burden of the precautionary activity outweighs the probability and magnitude of the risk, the custodian owes no duty to correct the alleged defect. Dauzat v. Curnest Guillot Logging Inc., 995 So.2d 1184, 1186-87 (La. 2008).

The second prong of this risk-utility inquiry focuses on whether the allegedly dangerous or defective condition is obvious and apparent. Under Louisiana law, a defendant generally does not have a duty to protect against an obvious and apparent hazard. Id.; Broussard, 113 So. 3d at 184. In order for an alleged hazard to be obvious and apparent, the hazard should be one that is “open and obvious to everyone who may potentially encounter it.” Bufkin, 171 So. 3d at 856 (citing Broussard, 113 So. 3d at 184). A landowner is not liable for an injury caused by “a condition [*9]  which should have been observed by the individual in the exercise of reasonable care, or which was as obvious to a visitor as it was to the landowner.” Dauzat, 995 So. 2d at 1186. “The open and obvious inquiry thus focuses on the global knowledge of everyone who encounters the defective thing or dangerous condition, not the victim’s actual or potentially ascertainable knowledge.” Broussard, 113 So. 3d at 188.

In Dauzat, the Louisiana Supreme Court analyzed the reasonableness factors and found that an open and obvious defect did not present an unreasonable risk of harm, reversing the district court’s denial of the landowner’s motion for summary judgment. 995 So.2d at 1187-88. There, the plaintiff allegedly injured his back after the truck he was driving struck a hole in an unpaved logging road. Id. at 1185.

The first reasonableness factor favored a finding of no duty, as the unpaved logging road provided the only method for removing harvested timber from the defendant’s land. Id. After considering the third factor, the court noted that logging roads were temporary and not paved; thus the cost of preventing the harm would have been unreasonably expensive. Id. Similarly, the Court found that the fourth factor favored a finding of no duty, as the job of logging is a dangerous [*10]  one by nature. Id. Ultimately, the court found that the dispute turned on the second factor, “the substantial likelihood and magnitude of injury from the hole, with consideration to whether the hole was apparent or obvious.” Id.

In analyzing the second factor, the court emphasized that the plaintiff was aware of the condition of the logging road, having traveled over it several times on the day of the accident. Id. The court also noted that five other truck drivers, who were working on the day of the incident, never reported any problems with the road. Id. The court “conclud[ed] that the presence of the hole in the logging road was an obvious danger which did not create a significant likelihood of injury.” Id.

Like the allegedly dangerous condition in Dauzat, the alleged defect here was not, as a matter of law, unreasonably dangerous. The utility of the road Lawrence was injured on has not been contested and satisfies the first factor. The road provided the only means for the log truck drivers to make deliveries to the paper mill. [Doc. No. 30, p. 8]. Likewise, for purposes of the fourth factor, the Court in Dauzat found “that the job of a logging truck driver is dangerous by nature, as such drivers [*11]  frequently encounter poor road conditions.” Id. at 1187; see also [Doc. Nos. 26-6, p. 5; 26-7, p. 6].

As to the third factor, the cost of preventing the harm, maintaining the road free of potholes would not be feasible. Based on the evidence in the record, there is no indication that the cost would be low. WestRock already employed a person whose job duties were to inspect and maintain the roads. [Doc. No. 30, p. 18-20]. Beyond the cost of the initial fixing the pothole, maintaining such surfaces free from defects is likely impossible, given the number of heavy trucks traveling over the road each day, and is certainly cost-prohibitive. Nevertheless, even assuming a low cost of prevention, an analysis of the second factor overwhelmingly tips the balance in favor of WestRock.

Similar to the analysis in Dauzat, “the dispute in this case revolves around the second factor, namely, the substantial likelihood and magnitude of harm from the hole, with consideration to whether the hole was apparent or obvious.” 995 So. 2d at 1187. Just as the court emphasized in Dauzat, Lawrence testified that he did not see the hole before his truck hit it, but noted that potholes can develop very quickly on the road and that he has to [*12]  look out for imperfections in the road at 90% of the mills he delivers to. [Doc. No. 26-3, p. 17-18].

Thirty-five other drivers had safely navigated the road on May 14, 2015, before the incident, and Lawrence had also safely navigated the road only three hours before the incident. [Doc. Nos. 30, p. 23; 26-8, p. 177]; see Dauzat, 995 So. 2d at 1187 (noting that none of the truck drivers who were working on the day of the accident reported any problems with the road). Lawrence was an experienced truck driver, had traveled on the road on many different occasions, and was aware that the high volume of trucks traveling through the road could cause potholes to develop quickly. [Doc. No. 26-3, pp. 6, 12]. At the time of the incident, Lawrence was in the process of putting his scale card in his sun visor. Id. at 20-21. Admittedly, Lawrence testified that the alleged pothole he hit did not appear to be particularly bad and could have been avoided. Id. at 11-14. See Dauzat, 995 So. 2d at 1185 (noting that plaintiff admitted he could have avoided the hole if he had seen it).

Under these circumstances, the presence of a pothole in the road was an obvious danger and did not present a significant likelihood of injury. Even assuming that Lawrence can establish the other elements [*13]  of his case, he cannot overcome summary judgment because he has failed, under Louisiana law, to generate factual issues that the pothole created an unreasonable risk of harm.

 

2. Actual or Constructive Notice

WestRock also argues that, even if the pothole created an unreasonable risk of harm, Lawrence is also unable to prove actual or constructive notice of the alleged defect. [Doc. No. 26, p. 20]. Lawrence contends that WestRock’s assignment of an employee, Orlando Williams, to inspect and maintain the roadways demonstrates WestRock’s constructive knowledge of the defect in the road. [Doc. Nos. 34, p. 9; 30, p. 18].

“[T]he question of whether a custodian or owner of a thing has constructive knowledge of a defect in that thing is inextricably linked with the exercise of reasonable care.” Dawson v. Rocktenn Servs., Inc., 16-30112, 2016 U.S. App. LEXIS 23313, 2016 WL 7468034, at *3 (5th Cir. Dec. 27, 2016) (citing Walters v. City of West Monroe, 162 So.3d 419, 424 (La. Ct. App. 2015)). The exercise of reasonable care consists of two requirements: (1) the owner or custodian must take reasonable steps to discover defects in the thing that creates an unreasonable risk of harm and (2) the owner or custodian must take reasonable steps to protect against injurious consequences resulting from defects in the thing that create an unreasonable risk [*14]  of harm. Id. “When an owner or custodian of a thing fails to exercise reasonable care to discover a defect in that thing, Louisiana law imputes the owner or custodian with knowledge of the defect if the defect is of such a character or has existed for such a period of time that a reasonable custodian or owner would have discovered it.” 2016 U.S. App. LEXIS 23313, [WL] at 4.

WestRock submits that on May 14, 2015, it employed Orlando Williams to maintain the roads at the mill. [Doc. No. 26-1, p. 21]. Williams would inspect the roads and upon any discovery of potholes would fill them in with rocks and a front-end loader. Id.; [Doc. No. 30, p. 18-20]. Lawrence and other drivers testified that potholes could develop on the road quickly. [Doc. Nos. 26-3, p. 18; 26-5, p. 5; 26-6, p. 6].

Here, Lawrence relies solely on WestRock’s dedication of an employee to road inspection and maintenance to show knowledge. [Doc. No. 34, p. 9]. Lawrence also argues that the road repair was made within minutes of his injury, which demonstrates that WestRock had the opportunity and means to prevent the injury before it occurred. Id. This argument ignores that, in order to immediately repair every pothole, WestRock would have had to expend significant [*15]  resources to have someone monitor every part of the road at every moment of the day. Lawrence has failed to put forward any evidence that the condition existed for a period of time sufficient to place the defendant on notice. See Finley v. RaceTrac Petroleum, Inc. 137 So. 3d 193 (La. App. 2 Cir. 2014); Shields v. Dolgencorp, LLC, CV 16-1826, 2016 U.S. Dist. LEXIS 162316, 2016 WL 6892889, at *3 (E.D. La. Nov. 23, 2016). The Court finds that Lawrence has failed to provide any evidence that WestRock failed to exercise reasonable care in its inspection and maintenance of the roads, and therefore, has not satisfied his burden of proving constructive knowledge.

 

1. Intervenor Plaintiff

Finally, the Court gives notice of its intent to sua sponte grant WestRock summary judgment against Intervenor Plaintiff QBE. QBE intervened in this case to be indemnified or reimbursed out of “any sums recovered” to or on behalf of Lawrence. [Doc. No. 1-3].

Thus, QBE’s claims in this case were contingent upon Lawrence’s ability to recover. See id. Since the Court determined that WestRock is not liable to Lawrence, QBE has no right of recovery. If QBE opposes the Court’s intended disposition of its requests for relief, it shall file a memorandum in opposition within fourteen (14) calendar days of the date of this Ruling and Judgment. See Lozano v. Ocwen Fed. Bank, FSB, 489 F.3d 636, 641 (5th Cir. 2007).

 

III. CONCLUSION

For [*16]  the reasons stated above, WestRock’s Motion for Summary Judgment is GRANTED, and Lawrence’s claims are DISMISSED WITH PREJUDICE. The Court also gives notice of its intent to sua sponte grant WestRock summary judgment against Intervenor Plaintiff QBE.

MONROE, LOUISIANA, this 22nd day of May, 2017.

/s/ Robert G. James

ROBERT G. JAMES

UNITED STATES DISTRICT JUDGE

BYRON SIMPSON, Personal Representative for the Estate of LIONA MAY SIMPSON, Deceased, Plaintiff, v. DALJEET SINGH LITT, an individual; and, MOHAMMAD TANVEER DBA TS TRUCKING, a foreign corporation; and, WESCO INSURANCE COMPANY, Defendants.

 

Case No. CIV-17-339-R

 

UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF OKLAHOMA

 

2017 U.S. Dist. LEXIS 77821

 

 

May 23, 2017, Decided

May 23, 2017, Filed

 

 

COUNSEL:  [*1] For Byron Simpson, Personal Representative for the Estate of Liona May Simpson, deceased, Plaintiff: Peter J Ram, LEAD ATTORNEY, Vassar Law Firm, Oklahoma City, OK.

 

For Wesco Insurance Company, Defendant: Jeffrey C Cartmell, LEAD ATTORNEY, Michael C Felty, Lytle Soule & Curlee-1200 OKC, Oklahoma City, OK.

 

JUDGES: DAVID L. RUSSELL, UNITED STATES DISTRICT JUDGE.

 

OPINION BY: DAVID L. RUSSELL

 

OPINION

 

ORDER

Before the Court is Defendant Wesco Insurance Company’s Motion to Dismiss. Doc. 4. The matter is fully briefed. Docs. 6 & 7. Defendant’s Motion is GRANTED.

Plaintiff Byron Simpson, personal representative of the Estate of Liona May Simpson, brings this negligence action against Defendants after Ms. Simpson sustained fatal injuries in a car crash in November 2014 on an Oklahoma highway. Doc. 1, at 2. Mr. Simpson names as a defendant not only the truck driver that allegedly caused the crash (Defendant Litt) and the driver’s employer (Mohammad Tanveer d/b/a TS Trucking), but also the trucking company’s insurer, Wesco Insurance Company (Wesco). Doc. 1, at 2. In its Motion to Dismiss, Wesco argues that Mr. Simpson has no statutory basis for naming Wesco as a defendant before he has obtained judgment against TS Trucking.

“Under [*2]  Federal Rule of Civil Procedure 8(a)(2), a pleading must contain a ‘short and plain statement of the claim showing that the pleader is entitled to relief.'” Ashcroft v. Iqbal, 556 U.S. 662, 677-78, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009). To survive a motion to dismiss, a pleading must offer more than “labels and conclusions” and “a formulaic recitation of the elements of a cause of action.” Bell Atlantic Corp v. Twombly, 550 U.S. 544, 555, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007). There must be “sufficient factual matter, [which if] accepted as true . . . state[s] a claim to relief that is plausible on its face.” Iqbal, 556 U.S. at 678 (quoting Twombly, 550 U.S. at 570). The Court “must accept all the well-pleaded allegations of the complaint . . . and must construe them in the light most favorable to the [non-moving party].” Thomas v. Kaven, 765 F.3d 1183, 1190 (10th Cir. 2014).

The sole issue here is whether Wesco may be named as a defendant prior to judgment being entered against its insured. Mr. Simpson alleges it may, since “[p]ursuant to 47 O.S. § 169, Defendant Wesco is bound to make compensation for injuries or death of persons resulting from the operations and conduct of Defendant Mohammad Tanveer [d/b/a] TS Trucking . . . and/or its agents and employees.” Doc. 1, Ex. 1, at 2. Under Oklahoma’s statutory scheme, however, that is not the case.

The general rule in Oklahoma is that a “defendant’s insurer cannot be directly sued by a plaintiff.” Hobbs v. Rui Zhao, No. 13-CV-0673-CVE-FHM, 2014 U.S. Dist. LEXIS 110452, 2014 WL 3898408, at *3 (N.D. Okla. Aug. 11, 2014) (citing Daigle v. Hamilton, 1989 OK 137, 782 P.2d 1379, 1380 & n. 1 (Okla.1989)). The Oklahoma [*3]  Supreme Court did recognize in Daigle, however, that injured parties could jointly sue motor carriers and their insurance companies when the carrier was required to file proof of a liability insurance policy with the Oklahoma Corporation Commission (OCC) under 47 Okla. Stat. § 169(A). Id. That statute forbids the OCC from issuing any certificate to a motor carrier of household good to operate in Oklahoma until the carrier has filed with the OCC proof of an insurance policy covering liability arising out of the motor carrier’s operations.1 The Daigle court reasoned that this statute–not the insurance policy itself–created a direct liability of the insurance company to an injured party and warranted naming the insurance company as a defendant. 782 P.2d at 1381.

 

1   “No certificate shall be issued by the Corporation Commission to any motor carrier of household goods until after such motor carrier shall have filed with the Commission a liability insurance policy or bond covering public liability and property damage . . . and such liability and property damage insurance policy or bond shall bind the obligor thereunder to make compensation for injuries to, or death of, persons, and loss or damage to property, resulting from the operation of any such motor carrier for which such carrier is legally liable. After judgment against the carrier for any damage, the injured party may maintain an action upon the policy or bond to recover the same, and shall be a proper party to maintain such action.” Okla. Stat. 47, § 169.

A second Oklahoma law, however, also justifies naming an insurer as a party. When Oklahoma enacted the Motor Carrier Act of 1995 (MCA) Okla. Stat. 47 § 230.21, et seq., it simply adopted the idea behind § 169. The MCA makes it unlawful for “any motor carrier to operate or furnish service within [Oklahoma] without first having obtained from the [Oklahoma Corporation Commission] a license,” id. § 230.28, and requires that the carrier have an approved insurance policy or bond requirement before the [*4]  OCC grant it a license, id. § 230.30. The MCA, however, did not entirely supersede § 169, since the MCA applies only “to the transportation of passengers or property by motor carriers and private carriers, except motor carriers of household goods and used emigrant movables, over public highways of this state.” Okla. Stat. 47 § 230.22(C). In contrast, § 169, now part of Oklahoma’s Household Goods Act of 2009, applies to “intrastate transportation by motor carriers of household goods,” with motor carriers of household goods limited to “person[s] transporting household goods . . . with an origin and destination within [Oklahoma].” Okla. Stat. 47, § 161A

Consequently, “[section] 169 applies by its very terms only to . . . household goods and used emigrant movables or other intrastate motor carriers.” Mason v. Dunn, No. CIV-14-282-KEW, 2016 U.S. Dist. LEXIS 37643, 2016 WL 1178058, at *2 (E.D. Okla. Mar. 23, 2016); see also White v. Lewis, No. CIV-13-862-C, 2014 U.S. Dist. LEXIS 174783, 2014 WL 7272464, *1 (W.D. Okla. Dec. 18, 2014) (“The clear language of § 169 establishes that it applies only to those motor carriers whose principal place of business in is Oklahoma); Irvan v. Golodnykh, No. CIV-16-075, 2016 U.S. Dist. LEXIS 82354, 2016 WL 3562057, *1 (E.D. Okla. June 24, 2016) (granting summary judgment on identical grounds). So for our purposes, Mr. Simpson has failed to state a claim against Wesco under Okla. Stat. § 169. There has been no allegation TS Trucking is a carrier of household goods, [*5]  and is appears that TS Trucking is not an intrastate carrier given Mr. Simpson’s allegation that the company is a California corporation. Doc. 1, Ex. 1, at 2. The Court therefore dismisses Wesco from this case.

Perhaps conceding that § 169 provides no basis for naming Wesco as a defendant, Mr. Simpson requests leave to amend. Pursuant to Fed.R.Civ.P. 15(a)(2), a plaintiff may amend his complaint after the defendant has answered only with leave of court. “The Court has the discretion whether to grant a motion seeking leave to amend, and leave should be freely granted where justice so requires.” Midcities Metro. Dist. No. 1 v. U.S. Bank Nat’l Ass’n, 44 F. Supp. 3d 1062, 1065 (D. Colo. 2014). That said, a Court may deny leave to amend where doing so would be futile. Frank v. U.S. West, Inc., 3 F.3d 1357, 1365 (10th Cir. 1993).

Here it might be. As explained, the only other statute under which Wesco could be named as a defendant is Okla. Stat. 47, § 230.30. From the facts as pled, it is not clear whether § 230.30 would apply to TS Trucking. So the Court will grant Mr. Simpson leave to amend, but in hopes of not having to revisit the issue of whether Wesco is a proper defendant, the Court will inform Mr. Simpson of its understanding of when § 230.30 applies.

The Oklahoma Supreme Court in Daigle seemed to lay a blanket rule that a plaintiff could maintain a joint, direct action against the carrier and [*6]  the insurer by virtue of the carrier’s obligation to maintain insurance under the statute. 1989 OK 137, 782 P.2d 1379, 1381 (Okla. 1989). Under that reasoning, § 230.30 would seem to allow Mr. Simpson to state a claim here. Unfortunately for him, the Oklahoma Court of Civil Appeals carved out an exception to this rule in Fierro v. Lincoln Gen. Ins. Co.: because neither § 169 nor § 230.30 applies to interstate motor carriers, the interstate carrier’s insurance company cannot be named as a defendant prior to judgment being entered against the carrier. 2009 OK CIV APP 62, 217 P.3d 158, 160 (Okla. Civ. App. 2009).

Given that TS Trucking appears to be an interstate carrier, Fierro suggests that Wesco is not a proper defendant here. This conclusion appears to be in line with the federal courts that have taken up the issue, none of which accept Mr. Simpson’s argument that Daigle never distinguished between foreign and domestic interstate carriers. His implicit argument appears to be that Oklahoma’s participation in the federal government’s Unified Carrier Registration (UCR) System means that interstate carriers operating within Oklahoma, such as TS Trucking, are still insured and their insurance companies may therefore be named as joint defendants under Oklahoma law.

For background, under the UCR system a motor carrier [*7]  may operate in several states, including Oklahoma, simply by filing proof of insurance in its home state. Mason, 2016 U.S. Dist. LEXIS 37643, 2016 WL 1178058, at * 2 (citing 49 C.F.R. § 367.4; 49 U.S.C. § 14504a; Okla. Stat. 47, § 162.1). Thus, “a for-hire motor carrier engaged in interstate commerce that complies with the Federal Motor Carrier Safety Regulations and registers its liability insurance policy or bond in its base state need not register in any other state participating in the UCR agreement”–such as Oklahoma. Beebe, 2012 U.S. Dist. LEXIS 5564, 2012 WL 137780, at *1 n.1 (citing 49 U.S.C. §§ 13908, 14504a). And because (1) these interstate carriers need not register in Oklahoma and (2) § 230.30 applies only to motor carriers required to obtain a license from the OCC, interstate carriers who have registered proof of insurance in their home state rather than Oklahoma are not subject to § 230.30. See e.g., White, 2014 U.S. Dist. LEXIS 174783, 2014 WL 7272464, *1 (W.D. Okla. Dec. 18, 2014) (citing Fierro, 217 P.3d at 159 (Adams, J. concurring)).

Given § 230.30 is inapplicable to these interstate carriers, federal courts have been unanimous in holding that the insurance companies for interstate carriers who have not filed proof of insurance in Oklahoma may not be named as joint defendants. See Mason, 2016 U.S. Dist. LEXIS 37643, 2016 WL 1178058, at *2 (E.D. Okla. Mar. 23, 2016) (“The terms of Section 230.30 clearly apply in the limited circumstances where the motor carrier obtains a license from the Oklahoma Corporation Commission as defined by Okla. Stat. tit. 47 § 230.23(3).”); White, 2014 U.S. Dist. LEXIS 174783, 2014 WL 7272464*1 (W.D. Okla. Dec. 18, 2014) (finding that because the insured was a [*8]  foreign corporation and therefore not required under the UCR System to file a certificate with the Oklahoma Corporation Commission, its insurance company was not a proper defendant under Okla. Stat. tit. 47, § 230.30); Beebe v. Flores, No. CIV-11-1381-HE, 2012 U.S. Dist. LEXIS 5564, 2012 WL 137780, *1 (W.D. Okla. Jan. 28, 2012) (declining to accept legal conclusion that insurance company was a proper party under § 230.30 and therefore dismissing it because “this court, other federal courts, and a panel of the Oklahoma Court of Civil Appeals, have held that§ 230.30(A) does not authorize a direct action against the insurer of an out-of-state motor carrier that has registered in its ‘home’ or ‘base’ state and not with the Oklahoma Corporation Commission”); Hubbard v. Liberty Mutual Fire Ins. Co., No. CIV-06-356, 2007 U.S. Dist. LEXIS 32451, 2007 WL 1299270 (E.D. Okla. May 1, 2007) (granting summary judgment to insurer because motor carrier did not obtain license from or file insurance with Oklahoma Corporation Commission); but see Mize v. Liberty Mutual Ins. Co., 393 F.Supp.2d 1223, 1226 (W.D. Okla. 2005) (refusing to dismiss insurance company from suit, pre-Iqbal, and accepting legal conclusion that insurance company was a proper defendant under § 230.30). Simply put, “merely submitting a home state’s insurance policy as part of the UCR . . . is insufficient to allow a direct cause of action [against an insurer] under section 230.30,” and courts have “roundly rejected” [*9]  arguments to the contrary.” Hobbs, 2014 U.S. Dist. LEXIS 110452, 2014 WL 3898408, at *3 (collecting cases).

Mr. Simpson may name Wesco as a defendant if the Oklahoma Corporation Commission has issued it a motor carrier license. See, e.g., Sallee v. L.B. Trucking, Inc., No. 11-CV-212-TCK-PJC, 2012 U.S. Dist. LEXIS 11971, 2012 WL 314237, *9 (refusing to dismiss insurance company from case where its insured “[held] an Oklahoma motor carrier license and therefore presumably has an insurance policy on file with the OCC”). His complaint does not allege that TS Trucking has obtained this license and, in fact, admits he has no information on whether TS Trucking has done so. Doc. 6, at 3 n.1. Unless Mr. Simpson has reason to believe it has, amendment would be futile. The Court will not accept his legal conclusion that Wesco is a proper party under § 230.30. See, e.g, Beebe, 2012 U.S. Dist. LEXIS 5564, 2012 WL 137780, at *1.

Defendant’s Motion is GRANTED and leave to amend is granted to the extent it would be consistent with this Order.

IT IS SO ORDERED this 23rd day of May 2017.

/s/ David L. Russell

DAVID L. RUSSELL

UNITED STATES DISTRICT JUDGE