United States District Court for the Northern District of Ohio, Western Division

November 3, 2022, Filed

CASE NO. 3:22 CV 91

Reporter

2022 U.S. Dist. LEXIS 200848 *; 2022 WL 16695207

SHERRY R. LEE, et al., Plaintiffs, v. WERNER ENTERPRISES, INC., et al., Defendants.

Core Terms

preemption provision, motion to dismiss, preemption, preempted, truck, vicarious liability, broker, motor carrier, reply brief, transportation, carrier, shipper, route, motor vehicle, arranging, load

Counsel:  [*1] For Sherry R. Lee, David Lee, Plaintiffs: Andrew R. Young, Law Firm for Truck Safety, Cleveland, OH; Jennifer N. Brown, Arthur Law, Defiance, OH; Joshua M. Leizerman, Rena M. Leizerman, Michael J. Leizerman, Law Firm for Truck Safety, Toledo, OH.

For Hot Shot Expedite, Inc., Dorin Braga, Defendants: David J. Fagnilli, Marshall, Dennehey, Warner, Coleman & Goggin – Cleveland, Cleveland, OH; Vincent E. Cononico, Marshall Dennehey Warner Coleman & Goggin, Cleveland, OH.

Judges: James R. Knepp II, UNITED STATES DISTRICT JUDGE.

Opinion by: James R. Knepp II

Opinion

MEMORANDUM OPINION AND ORDER

Introduction

Plaintiffs Sherry Lee and David Lee bring negligence, vicarious liability, and loss of consortium claims in this personal injury case arising out of a truck crash against Defendants Dorin Braga (the truck driver), Hot Shot Expedite, Inc. (Braga’s employer and owner of the truck) (“Hot Shot”), Werner Enterprises, Inc. (the owner of the truck’s trailer) (“Werner”), Target Corporation (shipper of the goods carried on the truck) (“Target”), and Lipsey Logistics Worldwide, LLC (the shipping broker which arranged the goods’ transport) (“Lipsey”). (Doc. 11). Currently pending before the Court are Defendant Lipsey’s Motion to [*2]  Dismiss (Doc. 25), Defendant Target’s Motion to Dismiss (Doc. 26), and Plaintiffs’ Motion to Strike (Doc. 34). All are fully briefed and ripe for decision. Jurisdiction is proper under 28 U.S.C. § 1332. For the reasons set forth below, the Court denies the Motion to Strike and grants both Motions to Dismiss.

Background

This case stems from an auto accident in Paulding County, Ohio, on February 11, 2021. (Doc. 11, at 1-2). Plaintiff Sherry Lee alleges a semi-truck driven by Defendant Dorin Braga rear-ended her car as she slowed down to turn. Id. As she prepared to make a right turn, the truck failed to slow down and yield. Id. at 4. After the impact, Sherry Lee’s car veered off the north side of the roadway, struck a sign, overturned, and came to rest on its right side. Id. As a result of the accident, Sherry Lee is paralyzed from the waist down and is now a paraplegic. Id. at 2. Her injuries included a spinal cord lesion “resulting in complete loss of sensory and motor function below [the lesion],” pelvic fractures, rib fractures, vertebral fractures, a subdural hemorrhage, and a spleen laceration. Id. at 5. Plaintiff alleges Hot Shot, owner of the truck and Braga’s employer, “had its motor carrier [*3]  authority involuntarily revoked in February 2020 and was only reinstated in April 2020, less than a year before this crash.” Id. at 11.

Plaintiffs assert driver Braga was negligent in injuring Plaintiff Sherry Lee; that employer and truck owner Hot Shot, trailer owner Werner, shipper Target, and shipping broker Lipsey were negligent in their hiring; and Hot Shot, Werner, Target, and Lipsey are vicariously liable for Braga’s negligence. See Doc. 11. Plaintiff David Lee is Sherry Lee’s husband; he brings a loss of consortium claim. Id. at 14. Plaintiffs seek compensatory and punitive damages. Id.

Standard of Review

On a motion to dismiss under Federal Civil Rule 12(b)(6), the Court tests the complaint’s legal sufficiency. The Court construes the complaint in the light most favorable to Plaintiffs, accepts all factual allegations as true, and determines whether the complaint contains “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007). Although a complaint need not contain “detailed factual allegations,” it requires more than “labels and conclusions” or “a formulaic recitation of the elements of a cause of action.” Id. at 555. The complaint must “contain sufficient factual matter, accepted as true, to [*4]  state a claim to relief that is plausible on its face.” Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009). “A claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Id.

Discussion

Plaintiffs bring negligence claims against all Defendants and vicarious liability claims against all Defendants except Braga. (Doc. 11). Defendants Braga and Hot Shot filed an Answer to the Amended Complaint. (Doc. 12).¹

Defendants Lipsey and Target each filed a Motion to Dismiss. (Doc. 25; Doc. 26). Plaintiffs filed a Motion to Strike part of Defendant Lipsey’s reply brief. (Doc. 34). The Court first considers the Motion to Strike and then the Motions to Dismiss.

Motion to Strike

Plaintiffs move to strike Section C of Defendant Lipsey’s reply brief “because it raises a new issue.” (Doc. 34, at 1). Plaintiffs argue this section of the brief improperly raises the argument “that Plaintiffs failed to allege sufficient facts for the vicarious liability claim” for the first time. Id. at 2. Plaintiffs state Lipsey “does not even mention the term ‘vicarious'” in its original motion. Id. Plaintiffs argue a requirement from the Court for a [*5]  sur-reply from Plaintiffs on the new issue “would just further delay this case,” and they contend the new argument should be stricken. Id. at 3. This is necessary, Plaintiffs say, because a reply brief should “not provide the moving party with a new opportunity to present yet another issue for the court’s consideration.” Id. (quoting Scottsdale Ins. Co. v. Flowers, 513 F.3d 546, 553 (6th Cir. 2008)).

Plaintiffs fail to mention they initially raised the issue, not Lipsey. Section IV of Plaintiffs’ opposition brief to Lipsey’s motion to dismiss is titled “The FAAAA Does Not Preempt The Vicarious Liability Claim Against Lipsey.” (Doc. 31, at 19). Plaintiffs begin the section by writing:

Defendant Lipsey does not argue that the FAAAA preempts the Plaintiffs’ vicarious liability claim. But because Lipsey requests dismissal of “Plaintiffs’ claims,” rather than a singular claim or Plaintiffs’ negligent hiring claim, out of an abundance of caution, this memorandum briefly addresses the issue.

Id. Lipsey addressed section on vicarious liability in response to Plaintiffs’ argument. Courts “will generally not hear issues raised for the first time in a reply brief.” United States v. Crozier, 259 F.3d 503, 517 (6th Cir. 2001). “Court decisions have made it clear that [a litigant] cannot raise new issues in a reply brief; [*6]  he can only respond to arguments raised for the first time in [the opposing party]’s brief.” Id. (quoting United States v. Jerkins, 871 F.2d 598, 601 n.3 (6th Cir. 1989). A defendant does not err by responding in reply an argument raised by a plaintiff in a prior brief; “reply briefs reply to arguments made in the response brief”. Scottsdale Ins. Co., 513 F.3d at 553 (quoting Novosteel SA v. United States, 284 F.3d 1261, 1274 (Fed. Cir. 2002) (emphasis in original); see also 16 C. Wright, A. Miller, E. Cooper, & E. Grossman, Fed. Prac. & Proc. § 3974 at 428 (1977).

Because Lipsey did not raise a new issue on reply, but rather responded to an argument in Plaintiffs’ opposition brief, Plaintiffs’ Motion to Strike is denied.

Motions to Dismiss

The Court next turns to the Motions to Dismiss. Both Lipsey and Target argue they are entitled to dismissal of all claims.

Plaintiffs bring against Lipsey a negligence claim for “failing to exercise due care in arranging the transportation for the load, by hiring and/or retaining Hot Shot Expedite, Inc.[,] when Lipsey either knew or should have known that Hot Shot Expedite, Inc.[,] posed a risk of harm to others and was otherwise incompetent and unfit to perform the duties of an interstate motor carrier, or intentionally chose not to know” and a vicarious liability claim for “actions and omissions of Defendant Dorin [*7]  Braga . . . committed within the course and scope of his employment and/or agency with Defendant Lipsey” and “the acts of Defendants Hot Shot Expedite, Inc.[,] and Werner” as “principal or employer”. (Doc. 11, at 10-11).

Plaintiffs bring nearly identical claims against Target: a negligence claim for “breach[ing] its duty, which it owed to the motoring public, including Sherry Lee, by failing to exercise due care in arranging the transportation for the load, by failing to ensure the load was being shipped by a safe and competent motor carrier” and a vicarious liability claim for “[t]he negligent and reckless actions and omissions of Defendants Dorin Braga, Hot Shot Expedite, Inc., Werner, and Lipsey . . . committed within the course and scope of their respective employment or agency with Defendant Target.” Id. at 13-14.

Defendants Lipsey and Target each argue they are shielded from Plaintiffs’ claims by the preemption provision of the Federal Aviation Authorization Administration Act (“FAAAA”). (Doc. 25, at 1; Doc. 26, at 1). Plaintiffs contend their claims are not preempted by the FAAAA, or in the alternative, the claims fall within the “safety exception” of the preemption provision. [*8]  (Doc. 30, at 2; Doc. 31, at 10).

FAAAA Preemption Provision

The FAAAA preemption provision reads as follows:

(c) Motor carriers of property. –

(1) General rule. -Except as provided in paragraphs (2) and (3), a State, political subdivision of a State, or political authority of 2 or more States 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 (other than a carrier affiliated with a direct air carrier covered by section 41713(b)(4)) or any motor private carrier, broker, or freight forwarder with respect to the transportation of property.

49 U.S.C. §14501(c)(1).²

The Supreme Court made four holdings regarding interpretation of an identical preemption provision in the Airline Deregulation Act of 1978:

(1) that state enforcement actions having a connection with, or reference to, carrier rates, routes, or services are pre-empted;

(2) that such pre-emption may occur even if a state law’s effect on rates, routes, or services is only indirect;

(3) that, in respect to pre-emption, it makes no difference whether a state law is consistent or inconsistent with federal regulation; and

(4) that pre-emption occurs at least where state laws have a significant [*9]  impact related to Congress’ deregulatory and pre-emption-related objectives.

Morales v. Trans World Airlines, Inc., 504 U.S. 374, 384-87, 112 S. Ct. 2031, 119 L. Ed. 2d 157 (1992) (cleaned up).

Several years later, the Supreme Court held the same rulings apply to the preemption provision of the FAAAA:

In Morales, this Court interpreted the pre-emption provision in the Airline Deregulation Act of 1978. And we follow Morales in interpreting similar language in the 1994 Act before us here. We have said that “when judicial interpretations have settled the meaning of an existing statutory provision, repetition of the same language in a new statute indicates, as a general matter, the intent to incorporate its judicial interpretations as well.”

Rowe v. New Hampshire Motor Transp. Ass’n, 552 U.S. 364, 370, 128 S. Ct. 989, 169 L. Ed. 2d 933 (2008).

There is no binding law on this Court holding whether personal injury tort claims against shippers and brokers are preempted under the FAAAA as interpreted by Rowe and Morales. Plaintiffs argue the parallel preemption provision of the Airline Deregulation Act does not preempt personal injury claims. (Doc. 31, at 15). Contrary to Plaintiffs’ characterization of the case law, the decision they cite for this proposition notes only that one of the parties “does not urge that the ADA preempts personal injury claims relating to airline operations.” American Airlines, Inc. v. Wolens, 513 U.S. 219, 231 n.7, 115 S. Ct. 817, 130 L. Ed. 2d 715 (1995). The Supreme Court did not make [*10]  a holding on the issue in Wolens. In a later case, however, the Supreme Court expressly ruled the Airline Deregulation Act’s preemption provision applies to state common law claims, which have “the force and effect of law.” Northwest, Inc. v. Ginsberg, 572 U.S. 273, 281-82, 134 S. Ct. 1422, 188 L. Ed. 2d 538 (2014). This Court finds the holding in Northwest supports a reading of the FAAAA preemption section as applicable to Plaintiffs’ claims.

Plaintiffs next argue their claims are not sufficiently “related to a price, route, or service” as required by the preemption provision. See Doc. 31, at 16. “The phrase ‘related to[]’ . . . embraces state laws having a connection with or reference to carrier rates, routes, or services, whether directly or indirectly . . . At the same time, the breadth of the words ‘related to’ does not mean the sky is the limit.” Dan’s City Used Cars, Inc. v. Pelkey, 569 U.S. 251, 260, 133 S. Ct. 1769, 185 L. Ed. 2d 909 (2013).

The relation need not be explicit or direct; the preemption provision is to be read broadly. Rowe, 552 U.S. at 370. Plaintiffs’ claims against Lipsey stem entirely from Lipsey’s “arranging the transportation for the load” and “hiring and/or retaining” of the other Defendants. (Doc. 11, at 11). Plaintiffs’ claims against Target similarly stem entirely from Target’s alleged negligence in “arranging the transportation for the load” and Target’s employment or agency [*11]  relationships with other Defendants. Id. at 14. In short, Plaintiffs’ claims arise from these Defendants’ services.

Another Judge of this Court previously held — in a truck crash case — that negligence claims brought against a shipper and broker “fall[] squarely within the preemption of the FAAAA.” Creagan v. Wal-Mart Trans., LLC, 354 F. Supp. 3d 808, 813 (N.D. Ohio 2018). This Court agrees with and adopts the reasoning in Creagan. All of Plaintiffs’ tort claims are included within the scope of the FAAAA preemption provision.

Safety Exception

Plaintiffs next argue that even if their claims against Lipsey and Target are encompassed by the preemption provision, they fall within an exception thereto. The FAAAA exempts from preemption:

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).

Plaintiffs argue this Court should follow the example of the Ninth Circuit in finding the safety exception protects the claims [*12]  from dismissal. The Ninth Circuit held the language “safety regulatory authority of a State” includes common law tort claims and allows such claims to go forward. Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016, 1025-26 (9th Cir. 2020). The Ninth Circuit held “the phrase ‘with respect to’ in the safety exception is synonymous with ‘relating to.’ Consequently, the FAAAA’s safety exception exempts from preemption safety regulations that ‘have a connection with’ motor vehicles,” and while a tort claim does not directly regulate motor vehicles, it promotes safety on the road and is thus a safety regulation. Id. at 1030 (internal quotations and citations omitted).

This Court is not convinced. The plain meaning of the words “safety regulatory authority of a State” does not support the inclusion of private tort claims. See United States ex rel. Felten v. William Beaumont Hosp., 993 F.3d 428, 431 (6th Cir. 2021) (courts “usually interpret a statute according to its plain meaning”). Additionally, if the safety exception preserved all claims related to motor vehicles, as urged by Plaintiffs and Miller, “all preempted claims would then be ‘saved’ by the exception.” Creagan, 354 F. Supp. 3d at 814. This would make the entirety of the preemption provision redundant. Rather, this Court finds “it cannot ignore the straightforward preemption analysis as laid out by the Supreme Court, and finds instructive [*13]  the analysis in Rowe.” Volkova v. C.H. Robinson Co., 2018 U.S. Dist. LEXIS 19877, 2018 WL 741441, at *4 (N.D. Ill.). To the eye of this Court, the FAAAA’s preemption provision protects precisely parties such as the shipper and broker, who did not have direct involvement in the accident that injured Plaintiffs. “Contrary to Plaintiff[s’] argument that a finding of preemption leaves her without a remedy, [they] may and [have] sought recourse against the carrier . . . and [the] driver”. Id. This Court therefore finds Plaintiffs’ claims are not encompassed by the safety exception.

Because the Court finds Plaintiffs’ claims against shipper Target and broker Lipsey are preempted by the FAAAA and not protected by the safety exception, the claims must be dismissed.

Conclusion

For the foregoing reasons, good cause appearing, it is

ORDERED that Plaintiffs’ Motion to Strike (Doc. 34), be, and the same hereby is, DENIED; and it is

FURTHER ORDERED that Defendant Lipsey Logistics Worldwide, LLC’s Motion to Dismiss (Doc. 25), be, and the same hereby is, GRANTED; and it is

FURTHER ORDERED that Defendant Target Corporation’s Motion to Dismiss (Doc. 26), be and the same hereby is, GRANTED.

/s/ James R. Knepp II

UNITED STATES DISTRICT JUDGE

End of Document

---

¹ Defendant Werner filed a Motion to Dismiss (Doc. 43), and Plaintiffs voluntarily dismissed Werner from the case under Rule 41(a)(1) (Doc. 46).

² Brokers are expressly included in this provision. Shippers are not. Plaintiffs argue this supports a conclusion that shipper Target is not covered by the law. (Doc. 30, at 2). The Supreme Court in Rowe considered shippers to be included as well. Rowe v. New Hampshire Motor Transp. Ass’n, 552 U.S. 364, 372, 128 S. Ct. 989, 169 L. Ed. 2d 933 (2008). This Court accordingly interprets the FAAAA preemption provision as applicable to both shippers and brokers.

United States District Court for the Northern District of Indiana, Hammond Division

November 4, 2022, Decided; November 4, 2022, Filed

Cause No. 2:22-CV-115-PPS-JEM

Reporter

2022 U.S. Dist. LEXIS 201265 *; 2022 WL 16714139

MADISON WARDINGLEY, Plaintiff, v. ECOVYST CATALYST TECHNOLOGIES, LLC, et al., Defendants.

Core Terms

brokers, Logistics, preempted, motor carrier, trucking, freight, preemption, routes, Safe, courts, regulation, negligence claim, prices, preemption provision, state law, transport, containers, carrier, driver, cases, rates, collecting, common law claim, negligence law, motor vehicle, interstate, cargo

Counsel:  [*1] For Madison Wardingley, Plaintiff: Brady J Rife, Paul T Belch, LEAD ATTORNEYS, Stephenson Rife – She/IN/2150, Shelbyville, IN; M Michael Stephenson, McNeely Law LLP – She/IN/2177, Shelbyville, IN.

For Safe Trans, LLC, Tresor Hodari, Defendants: Christopher R Whitten, LEAD ATTORNEY, Whitten Law Office LLC – Ind/IN, Indianapolis, IN; Michael T Terwilliger, LEAD ATTORNEY, Whitten Law Office – Val/IN, Valparaiso, IN.

For Coyote Logistics, LLC, Defendant: Corban J Cavanaugh, LEAD ATTORNEY, Lewis Brisbois Bisgaard & Smith LLP – Hi/IN, Highland, IN; Scott C Bentivenga, LEAD ATTORNEY, Lewis Brisbois Bisgaard & Smith LLP – Chi/IL, Chicago, IL.

For Ecovyst Catalyst Technologies, LLC, Defendant: Joseph E Hopkins PHV, LEAD ATTORNEY, PRO HAC VICE, Pellis Law Group LLP – Nya/NY, Nyack, NY; Joseph L Pellis PHV, II, Michael A Kozik PHV, LEAD ATTORNEYS, PRO HAC VICE, Pellis Law Group LLP – Lis/IL, Lisle, IL; Renea E Hooper, LEAD ATTORNEY, Scopelitis Garvin Light Hanson & Feary PC – Ind/IN, Indianapolis, IN.

For Ecovyst Catalyst Technologies, LLC, Cross Claimant: Joseph E Hopkins PHV, LEAD ATTORNEY, Pellis Law Group LLP – Nya/NY, Nyack, NY; Joseph L Pellis PHV, II, Michael A Kozik PHV, LEAD ATTORNEYS, PRO [*2]  HAC VICE, Pellis Law Group LLP – Lis/IL, Lisle, IL; Renea E Hooper, LEAD ATTORNEY, Scopelitis Garvin Light Hanson & Feary PC – Ind/IN, Indianapolis, IN.

For Safe Trans, LLC, Cross Defendant: Christopher R Whitten, LEAD ATTORNEY, Whitten Law Office LLC – Ind/IN, Indianapolis, IN; Michael T Terwilliger, LEAD ATTORNEY, Whitten Law Office – Val/IN, Valparaiso, IN.

Judges: PHILIP P. SIMON, UNITED STATES DISTRICT JUDGE.

Opinion by: PHILIP P. SIMON

Opinion

OPINION AND ORDER

This matter arises from a motor vehicle collision on Interstate 80 near Gary, Indiana. Plaintiff Madison Wardingley claims that she was seriously injured when the vehicle in which she was a passenger collided with heavy steel containers that fell from a truck operated by Safe Trans, LLC, a commercial motor carrier. The containers, in turn, were owned by Defendant Ecovyst Catalyst Technologies, LLC. As is typical in the trucking industry, Defendant Coyote Logistics, LLC, a third-party logistics company and freight broker, arranged for Safe Trans to haul the containers on Ecovyst’s behalf. Wardingley claims each defendant was negligent and their negligence caused her to be seriously injured. [DE 10 at 4-8.]

Coyote Logistics seeks dismissal arguing that the [*3]  claims asserted against it, which sound in negligent selection of Safe Trans and vicarious liability for the alleged negligence of Safe Trans and its driver, are preempted by the Federal Aviation Administration Authorization Act (FAAAA). [DE 39; DE 40 at 2.] Because I find that Wardingley’s claims against Coyote Logistics do not effect pricing, rates or services in the trucking industry, they are not preempted by the FAAAA. Coyote Logistics’ motion to dismiss will be denied.

Factual Background

The following facts are drawn from Wardingley’s First Amended Complaint, which I accept as true for present purposes. On the evening of July 31, 2021, Wardingley was riding as a passenger in a vehicle on Interstate 80 outside Gary, Indiana, when a semi tractor-trailer owned by Safe Trans ran off the road and struck a barrier wall. [DE 10, ¶¶ 9-12.] A load of steel containers owned by Ecovyst fell off of the truck, landing in the path of the vehicle in which Wardingley was a passenger, and she was injured in the ensuing crash. Id., ¶¶ 13-15. While the tuck driver claims that the load shifted and caused him to run off the road, resulting in the collision with the barrier wall, Wardingley claims that [*4]  the driver had never before hauled cargo as a commercial motor vehicle driver and the crash was a result of negligence. See id., ¶¶ 12, 16.

Coyote Logistics identified and selected Safe Trans as the carrier to transport the Ecovyst containers. Id., ¶ 37. While Coyote Logistics was obligated to choose a safe motor carrier with appropriate skill and experience carrying cargo like the Ecovyst containers, Wardingley asserts that it failed to exercise due care in its selection of Safe Trans and its driver. Id., ¶¶ 38-39. Had Coyote Logistics exercised due diligence in evaluating the skill, experience, and safety record of Safe Trans prior to selecting the company to transport the goods, it would have found that the company or its driver were not sufficiently experienced to transport the Ecovyst containers and had previously violated safety rules by improperly securing cargo. Id., ¶ 39.

Discussion

Under Federal Rule of Civil Procedure 8(a), a complaint is required to contain “a short and plain statement showing that [the plaintiff] is entitled to relief.” Fed. R. Civ. P. 8(a). Federal Rule of Civil Procedure 12(b)(6) permits a party to move for dismissal if the complaint fails to state a claim upon which relief can be granted. Fed. R. Civ. P. 12(b)(6). At this stage, I accept the complaint’s allegations as true [*5]  and draw all reasonable inferences in Wardingley’s favor. Bradley Hotel Corp. v. Aspen Specialty Ins. Co., 19 F.4th 1002, 1006 (7th Cir. 2021). However, to avoid dismissal under Rule 12(b)(6), her claim for relief must be “plausible on its face.” Proft v. Raoul, 944 F.3d 686, 690 (7th Cir. 2019) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570, 127 S. Ct. 1955, 167 L. Ed. 2d 929 (2007)).

Facial plausibility requires a plaintiff to plead sufficient “factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Taha v. Int’l Brotherhood of Teamsters, Local 781, 947 F.3d 464, 469 (7th Cir. 2020) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678, 129 S. Ct. 1937, 173 L. Ed. 2d 868 (2009)). The Seventh Circuit has explained that a plaintiff must plead facts that “suggest a right to relief that is beyond the speculative level,” which requires alleging “enough details about the subject-matter of the case to present a story that holds together.” Sevugan v. Direct Energy Servs., LLC, 931 F.3d 610, 614 (7th Cir. 2019); Swanson v. Citibank, N.A., 614 F.3d 400, 404 (7th Cir. 2010). “[S]heer speculation, bald assertions, and unsupported conclusory statements” in the complaint fail to meet this burden. Taha, 947 F.3d at 469.

Preemption is an affirmative defense, S.C. Johnson & Son, Inc. v. Transp. Corp. of Am., 697 F.3d 544, 547 (7th Cir. 2012), and the party raising it bears the burden of proof, Johnson v. Diakon Logistics, No. 16-CV-06776, 2018 U.S. Dist. LEXIS 52149, 2018 WL 1519157, at *3 (N.D. Ill. Mar. 28, 2018) (citing Fifth Third Bank ex rel. Tr. Officer v. CSX Corp., 415 F.3d 741, 745 (7th Cir. 2005)). The Seventh Circuit, observing that “plaintiffs have no duty to anticipate affirmative defenses,” has held that in most cases, the “more appropriate” procedure to raise the affirmative defense of FAAAA preemption is to file an answer pleading preemption as an affirmative defense and then move for judgment on the pleadings under Rule 12(c). S.C. Johnson & Son, Inc., 697 F.3d at 547; Johnson, 2018 U.S. Dist. LEXIS 52149, 2018 WL 1519157, at *3 (citations omitted). [*6]  But practically speaking, such motions are evaluated under the same standard applicable to motions to dismiss under Rule 12(b)(6). See Adams v. City of Indianapolis, 742 F.3d 720, 727-28 (7th Cir. 2014). And because I have before me all that is “needed in order to be able to rule on the defense,” the procedural defect is “of no consequence,” Carr v. Tillery, 591 F.3d 909, 913 (7th Cir. 2010), so I will turn to the substance of the parties’ briefing notwithstanding the hiccup in the procedural posture.

Coyote Logistics contends that Wardingley’s state law claims must be dismissed because they are preempted by the FAAAA. The FAAAA was designed by Congress to untangle a web of state laws and regulations affecting the trucking industry and create a more uniform (and federal) paradigm. See Rowe v. N.H. Motor Transp. Ass’n, 552 U.S. 364, 368, 128 S. Ct. 989, 169 L. Ed. 2d 933 (2008); City of Columbus v. Ours Garage & Wrecker Serv., Inc., 536 U.S. 424, 440, 122 S. Ct. 2226, 153 L. Ed. 2d 430 (2002) (noting that intrastate regulation of trucking services had “unreasonably burdened free trade, interstate commerce, and American consumers”). As the Seventh Circuit has stated, “Congress enacted the FAAAA’s preemption provision in 1994 with the aim of eliminating the patchwork of state regulation of motor carriers that persisted fourteen years after it had first attempted to deregulate the trucking industry.” Nationwide Freight Sys., Inc. v. Illinois Commerce Comm’n, 784 F.3d 367, 373 (7th Cir 2015) (citations omitted).

The Act’s general preemption provision prohibits a state from enacting or enforcing a:

[L]aw, regulation, [*7]  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). For starters, reasonable people may wonder whether state tort claims are even implicated by this preemption provision. They are. So held the Supreme Court in Northwest, Inc. v. Ginsberg, 572 U.S. 273, 284, 134 S. Ct. 1422, 188 L. Ed. 2d 538 (2014).¹ See also Non Typical, Inc. v. Transglobal Logistics Grp. Inc., Nos. 10-C-1058 & 10-C-0156, 2012 U.S. Dist. LEXIS 73452, 2012 WL 1910076, at *2 (E.D. Wis. May 28, 2012) (collecting cases).

The statute’s plain terms cover any state laws (including common law claims) related to prices, routes, or services of a motor carrier, motor private carrier, broker, or freight forwarder. And the term “transportation” for purposes of the FAAAA is broadly defined as services related to the movement of persons or property, including “arranging for, receipt, delivery, elevation, transfer in transit, refrigeration, icing, ventilation, storage, handling, packing, unpacking, and interchange of passengers and property.” 49 U.S.C. § 13102(23). Thus, my task is to determine whether run-of-the-mill Indiana state negligence claims like the one brought here are “related to a price, route, or service” of Coyote Logistics as a commercial freight broker.

The parties acknowledge that neither [*8]  the Seventh Circuit nor the Supreme Court has precisely delineated the scope of FAAAA preemption with respect to personal injury negligence claims asserted against freight brokers. Review of the relevant case law uncovers a range of interpretive approaches adopted by the lower courts. Indeed, “district courts are sharply divided” on the question whether “personal injury claims alleging negligence by brokers in selecting motor carriers” are preempted by the FAAAA. Loyd v. Salazar, 416 F. Supp. 3d 1290, 1296-98 (W.D. Okla. 2019) (collecting cases). I am guided, but not bound, by the persuasive weight of decisions evaluating whether similar tort claims against motor carriers and commercial freight brokers are preempted by the FAAAA. These decisions fall into two general camps.

On one hand, I was surprised to see that a line of cases has concluded that the FAAAA’s “related to” language broadly preempts state laws that have an economic impact on prices, routes, and services of covered entities in the trucking industry. From this angle, several courts have dismissed state common law claims, including claims against brokers for the negligent selection of motor carriers, as preempted by the Act. See, e.g.,  [*9] Gillum v. High Standard, LLC, No. SA-19-CV-1378-XR, 2020 U.S. Dist. LEXIS 14820, 2020 WL 444371, at *3-5 (S.D. Tex. Jan. 27, 2020); Loyd, 416 F. Supp. 3d at 1298; Creagan v. Wal-Mart Transp., LLC, 354 F. Supp. 3d 808, 813 (N.D. Ohio 2018); Volkova v. C.H. Robinson Co., No. 16 C 1883, 2018 U.S. Dist. LEXIS 19877, 2018 WL 741441, at *4 (N.D. Ill. Feb. 7, 2018); Georgia Nut Co. v. C.H. Robinson Co., No. 17 C 3018, 2017 U.S. Dist. LEXIS 177269, 2017 WL 4864857, at *3-4 (N.D. Ill. Oct. 26, 2017).

On the other hand, several courts have held that state tort laws are too far removed from carriers’ and brokers’ prices, routes, and services to be expressly preempted by the FAAAA. See, e.g., Ciotola v. Star Transp. & Trucking, LLC, 481 F. Supp. 3d 375, 387-88 (M.D. Pa. 2020); Nyswaner v. C.H. Robinson Worldwide, Inc., 353 F. Supp. 3d 892, 896 (D. Ariz. 2019); Scott v. Milosevic, 372 F. Supp. 3d 758, 769-70 (N.D. Iowa 2019); Gilley v. C.H. Robinson Worldwide, Inc., No. 1:18-00538, 2019 U.S. Dist. LEXIS 52549, 2019 WL 1410902, at *5-6 (S.D.W. Va. 2019); Mann v. C.H. Robinson Worldwide, Inc., Nos. 16 C 102, 16 C 104 & 16 C 140, 2017 U.S. Dist. LEXIS 117503, 2017 WL 3191516, at *7-8 (W.D. Va. July 27, 2017). Other courts, too, have rejected federal preemption of plaintiffs’ tort claims based on language in a separate subsection of the FAAAA that expressly carves out state safety regulations from the preemptive scope of the Act (the so-called “safety exception”). See, e.g., Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016, 1026-31 (9th Cir. 2020), cert. denied, 142 S. Ct. 2866, 213 L. Ed. 2d 1090, 2022 WL 2295168 (June 27, 2022); Crouch v. Taylor Logistics Co., 563 F. Supp. 3d 868, 876 (S.D. Ill. 2021); Montgomery v. Caribe Transp. II, LLC, No. 19-CV-1300-SMY, 2021 U.S. Dist. LEXIS 170782, 2021 WL 4129327, at *2-3 (S.D. Ill. Sept. 9, 2021); accord Finley v. Dyer, No. 3:18-CV-78-DMB-JMV, 2018 U.S. Dist. LEXIS 182482, 2018 WL 5284616, at *6 (N.D. Miss. Oct. 24, 2018).

Coyote Logistics urges me to adopt the former approach. For her part, Wardingley raises both sets of countervailing arguments against preemption — state negligence law falls outside the scope of the general preemption provision, and in any case falls within the safety exception. I will consider both in turn.

1. The FAAAA Does Not Preempt Wardingley’s Negligence Claims

The lion’s share of the parties’ briefing parses seven words: “related to a price, route, or service.” 49 U.S.C. § 14501(c)(1). Before diving into whether (and what types of) state laws—or state tort claims—are “related to brokers’ prices, routes, or services,” it is useful to consider some generally acknowledged [*10]  principles about the FAAAA.

The Seventh Circuit has endorsed a broad construction of the phrase “related to” as preempting any “laws or actions having some type of connection with or reference to a [broker’s] rates, routes, or services, whether direct or indirect.” Nationwide Freight, 784 F.3d at 373 (emphasis added). However, in keeping with Supreme Court guidance that “the breadth of the words ‘related to’ does not mean the sky is the limit,” state laws with only “a tenuous, remote, or peripheral” relationship to rates, routes, or services are not preempted. Dan’s City Used Cars, Inc. v. Pelkey, 569 U.S. 251, 260-61, 133 S. Ct. 1769, 185 L. Ed. 2d 909 (2013); Nationwide Freight, 784 F.3d at 373. Put succinctly, to trigger FAAAA preemption in this circuit, (1) “a state must have enacted or attempted to enforce a law,” and (2) that law must relate to a broker’s “rates, routes, or services ‘either by expressly referring to them, or by having a significant economic effect on them.” Nationwide Freight, 784 F.3d at 373-74 (quoting Travel All Over the World, Inc. v. Kingdom of Saudi Arabia, 73 F.3d 1423, 1432 (7th Cir. 1996)).

As previously noted, I can set aside the first issue because state common-law actions qualify as “other provision[s] having the force and effect of law” under the FAAAA. Northwest, Inc., 572 U.S. at 284; United Airlines, Inc. v. Mesa Airlines, Inc., 219 F.3d 605, 607 (7th Cir. 2000); Non Typical, Inc., 2012 U.S. Dist. LEXIS 73452, 2012 WL 1910076, at *2 (collecting cases). Therefore, the second issue—whether the state law relates to rates, routes or services—is where the rubber meets the road. As the Supreme Court put it, “[s]ome state actions [*11]  may affect [rates] in too tenuous, remote, or peripheral a manner to have pre-emptive effect.” Morales v. Trans World Airlines, Inc., 504 U.S. 374, 388, 390, 112 S. Ct. 2031, 119 L. Ed. 2d 157 (1992). The Seventh Circuit has construed this language to entail that a court “must decide whether the state law at issue falls on the affirmative or negative side of the preemption line.” S.C. Johnson & Son, Inc., 697 F.3d at 550. This isn’t a particularly helpful description of how I am to go about answering the question. And indeed, I suppose the lack of guidance from higher courts on the issue of whether state negligence claims are preempted is what has led to the depth of the disagreement by various judges around the country on the preemption issue.

Here’s my best analysis of the issue: Evaluating a statute’s preemptive effect is ultimately an exercise “guided by the rule that the purpose of Congress is the ultimate touchstone in every preemption case.” Altria Grp., Inc. v. Good, 555 U.S. 70, 76, 129 S. Ct. 538, 172 L. Ed. 2d 398 (2008) (internal quotations and citation omitted). I am “mindful of the adage that Congress does not cavalierly preempt state law causes of action.” Montalvo v. Spirit Airlines, 508 F.3d 464, 471 (9th Cir. 2007). As the Supreme Court explained long ago, where “Congress has neither provided nor suggested any substitute for the traditional state court procedure for collecting damages for injuries caused by tortious conduct,” that adage is of particular [*12]  import. United Constr. Workers v. Laburnum Constr. Corp., 347 U.S. 656, 663-64, 74 S. Ct. 833, 98 L. Ed. 1025 (1954).

Let’s not beat around the bush: the upshot, if Coyote Logistics is right about the preemption issue, is that Ms. Wardingley will be left holding the bag and the tortfeasor will go about his merry way free to harm someone else. In other words, the injured party is deprived of its property without recourse or compensation, and the tortfeasor is granted “immunity from liability for their tortious conduct.” Id. Frankly, it’s a little hard to swallow the proposition that Congress intended such a result by displacing all state negligence claims against trucking companies through the passage of the FAAAA just because an adverse verdict against a trucking (or brokerage) company could conceivably effect cartage prices in some remote way.

Coyote Logistics claims I shouldn’t be so skeptical. They tell me that the negligence claims asserted against it “go to the heart of its business” and services—arranging for the transportation of property by carriers like Safe Trans as a federally licensed freight broker—and Wardingley’s allegations reveal that she seeks “to use Indiana tort law to determine and control [its] services as a broker.” [DE 40 at 11.] Complying with a reasonable duty of [*13]  care in its selection of motor carriers to safely and securely transport cargo across the country, Coyote Logistics argues, will require it to incur “additional burden and expense of complying with the patchwork of tort laws of the fifty states, which is exactly what Congress intended to avoid in enacting the preemption provision.” Id.

From one angle, Coyote Logistics’ argument has a superficial appeal. It is reasonable to think that imposing a duty of reasonable care in the selection of motor carriers entails meaningful economic effects on their services. Freight brokers may have to undertake additional measures to vet carriers, and these measures, in turn, will presumably raise their costs of production (and potentially their prices). But from an economic point of view, the argument cuts both ways. An equally reasonable view is that negligence in the selection of motor carriers itself “operates as a privately-imposed transaction cost on the affected sale.” Cf. S.C. Johnson & Son, Inc., 697 F.3d at 559 (citations omitted) (holding that enforcement of state anti-bribery (and more generally anti-corruption) laws is too tenuously related to the regulation of the rates, routes, and services in the trucking industry to fall within [*14]  the FAAAA’s preemption rule). Put differently, state regulation of commercial freight brokers’ negligence in the selection of motor carriers “is an attempt to lift this ‘tax’ from the shoulders of its consumers”—making “market pricing mechanisms work more efficiently—not less.” Id. (emphasis added). It would thus seem odd to bar enforcement of such laws based on concerns about a spiral of competing state regulations increasing transaction costs in the trucking industry.

As the citations set out above show [see supra at 6-8], a considerable amount of ink has been spilled over whether personal injury plaintiffs like Wardingley may proceed with negligence claims against freight brokers. On balance, I find more persuasive the line of recent decisions finding that such claims fall outside the FAAAA’s preemption provision.² Simply put, I remain dubious that Congress, in its mission to unencumber the interstate trucking industry from a patchwork of state tariffs, price controls, and similar economic regulations, also aimed to completely unyoke trucking companies and freight brokers from commonsense standards of care enforced through private tort actions. See Dilts v. Penske Logistics, LLC, 769 F.3d 637, 644-45 (9th Cir. 2014). It goes without saying that the [*15]  law of negligence is not specific to the trucking industry. Indiana’s common-law duty of ordinary care does not mention or target a freight broker’s prices, routes, or services. Accord Ciotola, 481 F. Supp. 3d at 388 (evaluating Pennsylvania negligence law). It applies across industries and walks of life. And, where the law of negligence applies, it’s easy enough to comply—just act reasonably.

Notably, a number of courts have long held that personal injury claims stemming from negligence are not preempted by the identical preemption provision applicable to the airline industry. See Scott, 372 F. Supp. 3d at 769 (citing Charas v. Trans World Airlines, Inc., 160 F.3d 1259, 1266 (9th Cir. 1998); Hodges v. Delta Airlines, Inc., 44 F.3d 334 (5th Cir. 1995) (en banc); see also Smith v. Am. W. Airlines, Inc., 44 F.3d 344, 346 (5th Cir. 1995) (en banc) (“Neither the language nor history of the ADA implies that Congress was attempting to displace state personal injury tort law concerning the safety of the airline business.”). This reasoning has equal application to covered entities in the trucking industry. See Scott, 372 F. Supp. 3d at 769. Lending from earlier ADA cases, several courts have concluded that personal injury negligence claims are not barred by the FAAAA. See, e.g., Ciotola, 481 F. Supp. 3d at 390 (holding that “although Pennsylvania’s tort law may have some negative financial consequences for a broker or carrier, it is not preempted by the FAAAA. Pennsylvania’s tort law is a part of the [*16]  backdrop of laws that all businesses must follow”); Owens v. Anthony, No. 2-11-0033, 2011 U.S. Dist. LEXIS 139961, 2011 WL 6056409, at *3 (M.D. Tenn. Dec. 6, 2011) (collecting and applying ADA precedents to FAAAA’s identical language).

In sum, based on the foregoing authorities, I find that the FAAAA does not preempt Wardingley’s personal injury negligence claims against Coyote Logistics sounding in vicarious liability and negligent selection of Safe Trans and its driver.

2. Wardingley’s Claims Fall Within the FAAAA’s Safety Exception

Wardingley’s claims are not preempted under the FAAAA for an independent reason—they fall within what courts have referred to as the “safety exception.” Notwithstanding the general provisions in § 14501(c)(1), the Act:

[S]hall 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) (emphasis added). In recent years, following the Ninth Circuit’s analysis in Miller v. C.H. Robinson Worldwide, Inc., several lower courts have interpreted this language [*17]  to spare state common law claims asserted against freight brokers from FAAAA preemption. 976 F.3d at 1026-31; see, e.g., Crouch, 563 F. Supp. 3d at 876; Montgomery, 2021 U.S. Dist. LEXIS 170782, 2021 WL 4129327, at *2-3; Finley, 2018 U.S. Dist. LEXIS 182482, 2018 WL 5284616, at *5.

In Miller, the plaintiff claimed that a freight broker negligently hired an unsafe motor carrier, who caused an accident resulting in the plaintiff’s bodily injury. 976 F.3d at 1020. The court determined that selection of a motor carrier strikes at the core function of a broker and while state negligence laws do not specifically dictate brokers’ services, they nevertheless impose “an obligation on brokers at the point at which they arrange for transportation by [a] motor carrier,” and thus “related to” brokers’ services. Id. at 1024-25. At the same time, the court found that the claims were saved by the safety exception, since under the Act states retain power to “regulate safety through common-law tort claims.” Id. at 1026. The balance of lower court decisions following Miller, including those of a handful of lower courts in the Seventh Circuit, have adopted the second prong of Miller. [See DE 45 at 12-13 & n.2 (collecting cases).]

I find the second prong of Miller‘s analysis persuasive and consistent with the legislative intent underlying the FAAAA: namely, to preempt price and service regulations dictating the economics of the interstate [*18]  tucking and freight brokering markets, not safety, the traditional ambit of state governments. States have a safety interest in private tort actions, like Wardingley’s here, which serve to regulate the safety of roadways. As the Ninth Circuit correctly observed, the FAAAA’s legislative history is devoid of any suggestion that “Congress intended to eliminate this important component of the States’ power over safety.” See 976 F.3d at 1022-23, 1026; accord City of Columbus, 536 U.S. at 439 (“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.”).

Coyote Logistics retorts that the language of the safety exception is “much more narrow” than elucidated in Miller, and simply does not apply to common law claims against freight brokers. [See DE 49 at 8.] Admittedly, the plain language of the exception does not mention common law tort claims or brokers’ services in selecting motor carriers, whereas the words “law” and “broker” are expressly included in the general preemption provision. Compare 49 U.S.C. § 14501(c)(2)(A), with § 14501(c)(1). The exception says that it applies to “the safety regulatory authority of a State with respect to motor vehicles,” [*19]  and Coyote Logistics notes that brokers are not directly responsible for loading, operating, or maintaining motor vehicles. Coyote Logistics also relies on case law suggesting that the phrase “regulatory authority” does not “permit a private right of action” or extend to state common law claims. [DE 40 at 16-17 (citing Gillum, 2020 U.S. Dist. LEXIS 14820, 2020 WL 444371, at *12).] These arguments all press a reasonable, alternative interpretation of the scope of the phrase “the safety regulatory authority of a State with respect to motor vehicles.” Ultimately, however, I am guided by Miller‘s persuasive reading of the FAAAA’s legislative history, see 976 F.3d at 1022-23, 1026-27, along with the Seventh Circuit’s admonition that state law should be completely preempted “only where Congress clearly intended to replace state law with federal law and create a federal forum,” In re Repository Techs., Inc., 601 F.3d 710, 723 (7th Cir. 2010). Thus, for this independent reason, Wardingley’s claims are not preempted by the FAAAA.

Conclusion

For the foregoing reasons, Defendant Coyote Logistics, LLC’s Motion to Dismiss Count III of Plaintiff’s First Amended Complaint [DE 39] is DENIED.

SO ORDERED.

ENTERED: November 4, 2022.

/s/ Philip P. Simon

PHILIP P. SIMON, JUDGE

UNITED STATES DISTRICT COURT

End of Document

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¹ Case law interpreting an identical preemption provision codified in the Airline Deregulation Act (ADA) lends weight to my analysis of the FAAAA. “[T]he Supreme Court has generally taken the position that the statutes deregulating the airline industry and those deregulating the trucking industry should be construed consistently with one another.” S.C. Johnson & Son, Inc., 697 F.3d at 548; see also id. at 549-52 (construing key Supreme Court authorities). See generally Rowe, 552 U.S. at 367-70.

² To be sure, others have viewed the issue differently. At the same time, this view draws substantial support from the decisions of several lower courts considering similar arguments.