GORDON COMPANIES, INC., Plaintiff, v. FEDERAL EXPRESS CORPORATION, et al., Defendants.
14-CV-00868-RJA-JJM
UNITED STATES DISTRICT COURT FOR THE WESTERN DISTRICT OF NEW YORK
2016 U.S. Dist. LEXIS 120205
September 2, 2016, Decided
September 2, 2016, Filed
COUNSEL: [*1] For Gordon Companies, Inc., Plaintiff: Dean M. Drew, LEAD ATTORNEY, Buffalo, NY.
For Federal Express Corporation, FedEx Ground Package System, Inc., FedEx SmartPost, Inc., Defendants: Aaron Thomas Cassat, LEAD ATTORNEY, Federal Express Corporation, Memphis, TN; John Charles Snyder, LEAD ATTORNEY, FedEx Ground Package System, Inc., Moon Township, PA; Susan C. Roney, LEAD ATTORNEY, Nixon Peabody LLP, Buffalo, NY.
JUDGES: JEREMIAH J. MCCARTHY, United States Magistrate Judge.
OPINION BY: JEREMIAH J. MCCARTHY
OPINION
REPORT AND RECOMMENDATION
This case has been referred to me by Hon. Richard J. Arcara for supervision of pretrial proceedings, including the preparation of a Report and Recommendation on dispositive motions [8].1 Before me is defendants’ second motion [42] to dismiss the Second Amended Complaint pursuant to Fed. R. Civ. P. (“Rule”) 12(b)(6) [42]. Oral argument was held on January 21, 2016 [47], followed by supplemental briefing [48-51]. For the following reasons, I recommend that the second motion be denied, without prejudice to further consideration by Judge Arcara.
1 Bracketed references are to the CM/ECF docket entries.
BACKGROUND
I assume the reader’s familiarity with defendants’ prior motion to dismiss [25], my September 10, 2015 Report and Recommendation [*2] addressing that motion [34], and Judge Arcara’s November 17, 2015 Decision and Order [39] adopting in part and rejecting in part my Report and Recommendation.
The pending motion seeks “dismissal on two grounds asserted in defendants’ first motion to dismiss: (1) that plaintiff has not and cannot comply with the contractually required notice provisions regarding the overcharges alleged in the Second Amended Complaint; and (2) that the plaintiff’s claim is preempted as to FedEx Ground and FedEx SmartPost by the Carmack Amendment”. Defendants’ Memorandum of Law [42-1], p.1. Each of these arguments will be addressed.
ANALYSIS
- Notice
Defendants argue that in its objections to my prior Report and Recommendation, plaintiff “reversed its prior representations to this Court that it made no shipments that were ‘eligible’ for the SmartPost discounts. This about-face brings Plaintiff’s breach of contract claim squarely within the contractual notice provisions that apply to allegations of overcharging”. Defendants’ Memorandum of Law [42-1], p.1. However, plaintiff’s so-called “about face” was contained in its October 29, 2015 Reply Memorandum [38] in support of its objections to my prior Report and Recommendation. [*3] See Defendants’ Memorandum of Law [42-1], pp. 4-5 (quoting Reply Memorandum [38], p. 7). During oral argument of plaintiff’s objections on November 16, 2015, defendants had the opportunity to alert Judge Arcara to plaintiff’s alleged change of positon. Therefore, I believe this argument is subsumed in his determination that “the allegations in plaintiff’s complaint adequately allege a breach of contract”. Decision and Order [39], p. 2.
Defendants argue that “[p]laintiff fails to allege that it ‘has satisfied and complied with all notices and claims periods,’ as required by the Service Guide”. Defendants’ Memorandum of Law [42-1], p. 8. However, “[t]he contractual notice requirement has been treated as a condition precedent to suit”, Jim Ball Pontiac-Buick-GMC, Inc. v. DHL Express (USA), Inc., 2012 U.S. Dist. LEXIS 13546, 2012 WL 370319, *4 (W.D.N.Y. 2012) (Curtin, J.), and Rule 9(c) allows plaintiff “to allege generally that all conditions precedent have occurred or been performed”. Defendants’ Service Guide cannot impose stricter pleading requirements than those set forth in Rule 9(c), since “[p]arties … cannot modify the Federal Rules of Civil Procedure by agreement”. In re Application of O’keeffe, 2016 U.S. Dist. LEXIS 53572, 2016 WL 2771697, *4 (D.Nev. 2016).
Plaintiff alleges that it “met its obligations under the SmartPost Agreement, inter alia, by making its computer system available to defendants for modification of the FedEx Software [*4] and by transmitting the delivery information and by giving the Shipments to defendants for delivery”. Second Amended Complaint [23], ¶36. Because the phrase “inter alia” means “[a]mong other things” (Black’s Law Dictionary (9th ed.)), the allegation that it “met its obligations under the SmartPost Agreement” is not limited to the specific examples mentioned, and is broad enough to cover compliance with the contractual notice requirements. Whether plaintiff can prove that allegation (or even survive a motion for summary judgment) is a question for another day.
- The Carmack Amendment
“The Carmack Amendment to the Interstate Commerce Act of 1887 governs the liability of motor carriers for loss or damage to goods transported in interstate commerce. See 49 U.S.C. § 14706(d).” AIG Europe (Netherlands), N.V. v. UPS Supply Chain Sols., Inc., 765 F. Supp. 2d 472, 481 (S.D.N.Y. 2011). In my prior Report and Recommendation ([34], p. 5), I expressly declined to consider the merits of defendants’ preemption argument under the Carmack Amendment. Because that argument does not appear to fall within the scope of Judge Arcara’s Decision and Order (see Decision & Order [39]), I will address it here.
The Carmack Amendment “addresses the subject of carrier liability for goods lost or damaged during shipment, and most importantly provides shippers with the statutory right to recover for the actual loss or injury to their property caused by any of the carriers [*5] involved in the shipment”. Cleveland v. Beltman North American Co., 30 F.3d 373, 377 (2d Cir. 1994) (emphasis in original). “Because the issue of a shipper’s compensation for actual loss or injury to its property has been comprehensively and directly addressed by the Carmack Amendment, a federal common law cause of action – even assuming such exists – is displaced by the Act.” Id. at 381.
Accordingly, courts in this Circuit have held that the Carmack Amendment does not preempt claims for overcharges. See Frey v. Bekins Van Lines, Inc., 748 F.Supp.2d 176, 181(E.D.N.Y. 2010) (“the Carmack Amendment refers only to actions to recover for lost or damaged goods. There are no such claims raised here, and therefore this action is in no way expressly preempted by the statute”); Learning Links, Inc. v. United Parcel Service of America, 2006 U.S. Dist. LEXIS 13574, 2006 WL 785274 **3-4 (S.D.N.Y.2006) (recognizing “the well-settled axiom that the Carmack Amendment applies only to loss, damage, or injury to shipped goods . . . . Learning Links’ Complaint only refers to shipment overcharges. Nothing in the Complaint alleges that the goods were lost or damaged”). Although defendants cite contrary authority from other circuits (defendants’ Reply Brief [46], p. 9), that authority does not bind this court. Since plaintiff does not seek damages for the loss or damage of goods during shipment, its claim is not preempted by the Carmack Amendment.
CONCLUSION
For these reasons, I recommend that defendants’ second motion to dismiss [42] be denied. Unless otherwise [*6] ordered by Judge Arcara, any objections to this Report and Recommendation must be filed with the clerk of this court by September 19, 2016 (applying the time frames set forth in Rules 6(a)(1)(C), 6(d), and 72(b)(2)). Any requests for extension of this deadline must be made to Judge Arcara. A party who “fails to object timely . . . waives any right to further judicial review of [this] decision”. Wesolek v. Canadair Ltd., 838 F. 2d 55, 58 (2d Cir. 1988); Thomas v. Arn, 474 U.S. 140, 155, 106 S. Ct. 466, 88 L. Ed. 2d 435 (1985).
Moreover, the district judge will ordinarily refuse to consider de novo arguments, case law and/or evidentiary material which could have been, but were not, presented to the magistrate judge in the first instance. Paterson-Leitch Co. v. Massachusetts Municipal Wholesale Electric Co., 840 F. 2d 985, 990-91 (1st Cir. 1988).
The parties are reminded that, pursuant to Rule 72(b) and (c) of this Court’s Local Rules of Civil Procedure, written objections shall “specifically identify the portions of the proposed findings and recommendations to which objection is made and the basis for each objection . . . supported by legal authority”, and must include “a written statement either certifying that the objections do not raise new legal/factual arguments, or identifying the new arguments and explaining why they were not raised to the Magistrate Judge”. Failure to comply with these provisions may result in the district judge’s refusal to consider [*7] the objections.
Dated: September 2, 2016
/s/ Jeremiah J. McCarthy
JEREMIAH J. MCCARTHY
United States Magistrate Judge
