United States District Court, E.D. Kentucky, Central Division, Frankfort
MEMORANDUM OPINION & ORDER
GREGORY F. VAN TATENHOVE, UNITED STATES DISTRICT JUDGE
Progressive
Rail, Inc. and Siemens Energy, Inc. brought separate actions,
in separate districts, seeking to recover for damages to
electrical transformers they claim were sustained during rail
shipment by CSX Transportation, Inc. from Baltimore,
Maryland, to Ghent, Kentucky. Progressive filed its action
against CSX in the Eastern District of Kentucky on April 1,
2015; Siemens filed its action against CSX in the District of
Maryland on April 14, 2015. Ultimately, Siemens's action
was transferred to the Eastern District of Kentucky, and
consolidated into Progressive's action. Following
consolidation, Siemens filed a Second Amended Complaint. CSX
now moves to dismiss that complaint. Additionally, Siemens
filed a motion to intervene in Progressive's action. For
the following reasons, CSX's Motion to Dismiss will be
GRANTED IN PART and DENIED IN
PART, and Siemens's Motion to Intervene will be
DENIED.
I
Given
the present context, the factual summary that follows is
taken from the Siemens's Second Amended Complaint [R.
52.] and construed in favor of the plaintiff. See Crugher
v. Prelesnik, 761 F.3d 610, 614 (6th Cir. 2014)
(citation omitted). At some point prior to August 23, 2012,
Gallatin Steel Company purchased two electrical transformers
from Siemens. [See R. 52.] Siemens contracted with
Kuehne Nagel, Inc. (K), who contracted with Progressive,
who contracted with CSX, for the shipment of the two
transformers by rail from the Port of Baltimore to Ghent,
Kentucky. [See Id. at 2-3.] Progressive, having
arranged the rail shipment of the transformers with CSX,
issued a bill of lading for this shipment.[1] [Id. at
3.] The bill of lading listed Progressive Rail, Inc. as the
shipper, and Gallatin Steel Company as the Consignee. [R.
53-2.] The bill of lading was not signed by Progressive, CSX,
K, or Siemens, and it contained no terms or conditions or
other boilerplate language. [See id.] Additionally,
the area of the bill of lading dedicated to the declared
value of the cargo was left blank. [Id.]
On or
about August 23, 2012, the transformers, “in good order
and condition, were delivered to CSX[T] at the port of
Baltimore, Maryland for carriage to Siemens' customer
Gallatin Steel Company in Ghent, Kentucky.” [R. 52 at
2.] The transformers arrived in Ghent in a damaged condition.
[Id. at 3.] “[T]he transformers' impact
recorders indicat[ed] that the transformers had been
subjected to g-forces greater than the maximum allowed for
transportation by rail. . . .” [Id.] One of
the transformers (Serial Number D147578) sustained damage to
the extent it had to be “returned to Siemens [sic]
manufacturing plant in Dresden, Germany where it was opened,
inspected, repaired and subsequently returned to Gallatin
Steel Company.” [Id.] The other transformer
(Serial Number D147579), although damaged, remained in the
United States for later inspection and testing. [See
id.] According to Siemens, it sustained losses estimated
at approximately $1, 555, 824.60 for costs in transporting,
inspecting, repairing, and storing the transformers.
[Id. at 4-5.] Within nine months of the transformers
being damaged, Siemens, pursuant to 49 U.S.C. §
11706(e), filed a written claim with CSX regarding the
damaged transformers. [Id. at 4.] CSX denied
Siemens's claim on April 18, 2013. [Id.]
Siemens
first asserts a claim against CSX under the Carmack
Amendment, 49 U.S.C. § 11706, alleging CSX, as the rail
carrier, is liable to Siemens, as the owner of the
transformers, for the damage incurred by the transformers
during rail shipment. [See generally R. 52.] Siemens
also seems to assert state law claims of negligence and
breach of duty as bailee against CSX. [Id. at 4.]
CSX moves to dismiss Siemens's Second Amended Complaint
asserting Siemens's lacks standing to bring a Carmack
Amendment claim because Siemens was not named in the bill of
lading. [R. 53.] Additionally, CSX seeks to dismiss any state
law claims Siemens asserts in its Second Amended Complaint
because any such claim is preempted by the Carmack Amendment.
[Id.]
II
The
Federal Rules of Civil Procedure allow a defendant to seek
dismissal of a complaint which fails to state a claim upon
which relief can be granted. Fed.R.Civ.P. 12(b)(6). In making
such a motion, “[t]he defendant has the burden of
showing that the plaintiff has failed to state a claim for
relief.” DirecTV, Inc. v. Treesh, 487 F.3d
471, 476 (6th Cir. 2007) (citing Carver v. Bunch,
946 F.2d 451, 454-55 (6th Cir. 1991)). Federal Rule 8
requires only “a short and plain statement of the claim
showing that the pleader is entitled to relief.”
Fed.R.Civ.P. 8(a)(2). However, to survive a motion to
dismiss, the complaint “must contain either direct or
inferential allegations” establishing each material
element required for recovery under some actionable legal
theory. Bishop v. Lucent Technologies, Inc., 520
F.3d 516, 519 (6th Cir. 2008) (internal citation and
quotation marks omitted).
When
reviewing a Rule 12(b)(6) motion, the Court
“construe[s] the complaint in the light most favorable
to the plaintiff, accept[s] its allegations as true, and
draw[s] all reasonable inferences in favor of the
plaintiff.” DirecTV, Inc., 487 F.3d at 476
(citation omitted). The Court, however, “need not
accept as true legal conclusions or unwarranted factual
inferences.” Id. (citation omitted). Moreover,
as is now well known, “a complaint must contain
sufficient factual matter, accepted as true, to ‘state
a claim to relief that is plausible on its face.'”
Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (citing
Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 570
(2007)). In other words, the facts that are pled must rise to
the level of plausibility, not just possibility -
“facts that are merely consistent with a
defendant's liability . . . stop[ ] short of the line
between possibility and plausibility.” Iqbal,
556 U.S. at 678 (quoting Twombly, 550 U.S. at 557).
According to the Sixth Circuit, “[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.”
DirecTV, Inc., 487 F.3d at 476 (citing
Twombly, 550 U.S. at 556). Thus, the plaintiff must
at least “provide the grounds of his entitlement to
relief, [which] requires more than labels and conclusions. .
. .” Twombly, 550 U.S. at 555 (internal
citations and quotation marks omitted).
When
ruling on a Rule 12(b)(6) motion, a district court generally
may not consider matters presented outside the pleadings
unless it converts the motion into one for summary judgment
under Rule 56. Fed.R.Civ.P. 12(d); Heinrich v. Waiting
Angels Adoption Servs., Inc., 668 F.3d 393, 405 (6th
Cir. 2012). The district court, however, also has the
discretion to ignore such evidence and resolve the motion
solely on the basis of the pleadings. Heinrich, 668
F.3d at 405; Max Arnold & Sons, LLC v. W.L. Hailey
& Co., Inc., 452 F.3d 494, 502-03 (6th Cir. 2006)
(collecting cases). Certain matters beyond the allegations in
the complaint such as “matters of public record,
orders, items appearing in the record of the case, and
exhibits attached to the complaint, also may be taken into
account.” Amini v. Oberlin College, 259 F.3d
493, 502 (6th Cir. 2001) (citations and internal quotation
marks omitted). Additionally, the Sixth Circuit has held that
when a defendant attaches undisputed documents to a
motion to dismiss, they “are considered part of the
pleadings if they are referred to in the plaintiff's
complaint and are central to her claim.” Id.
(citations and internal quotation marks omitted).
A
CSX
first challenges whether Siemens has standing to bring its
claim. [R. 53.] “Standing is a threshold question in
every federal case, ” Coal Operators & Assocs.,
Inc. v. Babbitt, 291 F.3d 912, 915 (6th Cir. 2002)
(quoting Warth v. Seldin, 422 U.S. 490, 498 (1975)).
Article III's “irreducible constitutional
minimum” of standing has three elements. Lujan v.
Defenders of Wildlife, 504 U.S. 555, 560 (1992). The
plaintiff must: (1) have suffered an
‘injury-in-fact' - an invasion of a legally
protected interest which is (a) concrete and particularized,
and (b) actual an imminent, not conjectural and
hypothetical;” (2) show that the injury is
“fairly traceable to the challenged action of the
defendant;” and (3) show that it is “likely, as
opposed to merely speculative, that the injury will be
redressed by a favorable decision.” White v. United
States, 601 F.3d 545, 551 (6th Cir. 2010) (quoting
Lujan, 504 U.S. at 560-61). “The party
invoking federal jurisdiction bears the burden of
establishing these three elements.” Lujan, 504
U.S. at 561. Siemens's Second Amended Complaint addresses
all three of the constitutional requirements. [See
R. 52.]
CSX,
however, does not challenge Siemens's constitutional
standing, but rather asserts that Siemens lacks statutory
standing to bring its Carmack claim. Where constitutional
standing deals with the federal district courts' power to
hear Article III cases and controversies, statutory standing
looks to whether Congress, by statute, intentionally removed
certain causes of actions from the realm of cases or
controversies federal district courts normally hear.
Relatedly, Congress did not remove cases concerning rail
carrier liability from those Article III cases and
controversies heard by lower federal courts.
In
1906, Congress enacted the Carmack Amendment, which
“created a national scheme of carrier liability for
loss or damages to goods transported in interstate
commerce.” Exel, Inc. v. S. Refrigerated Transp.
Inc., 807 F.3d 140, 148 (6th Cir. 2015). The purpose of
the Carmack Amendment “is to relieve cargo owners of
the burden of searching out a particular negligent carrier
from the often numerous carriers handling an interstate
shipment of goods.” KawasakiKisen Kaisha
Ltd. V. ...