Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

LLC v. Garcia

United States District Court, E.D. Kentucky, Lexington

February 4, 2019

VAL'S AUTO SALES & REPAIR, LLC, Plaintiff,
v.
ROBERTO A. GARCIA, et al., Defendants.

          MEMORANDUM OPINION AND ORDER

          Joseph M. Hood Senior U.S. District Judge

         This matter comes before the Court on Defendants Ezee Trans, LLC (“Ezee Trans”) and Roberto Garcia's Motion to Dismiss the Amended Complaint [DE 5], Plaintiff Val's Auto Sales & Repair, LLC's (“Val's”) Motion to Remand [DE 7] and Motion for Leave to File Second Amended Complaint [DE 12], and Defendants Garcia and Progressive Northern Insurance Company's (“Progressive”) Motion for Leave to File Sur-Reply to Plaintiff's Reply in Support of Motion to Remand [DE 17]. Having considered the matter fully, and being otherwise sufficiently advised, the undersigned will grant in part Defendants Ezee Trans and Garcia's Motion to Dismiss the Amended Complaint [DE 5], insofar as it pertains to Val's negligence, vicarious liability, and negligent entrustment claims, deny in part Defendants Ezee Trans and Garcia's Motion to Dismiss the Amended Complaint [DE 5], insofar as it pertains to Val's Carmack Amendment claim against Defendant Ezee Trans, deny Val's Motion to Remand [DE 7], grant Val's Motion for Leave to File Second Amended Complaint [DE 12], and grant Defendants Garcia and Progressive Northern Insurance Company's Motion for Leave to File Sur-Reply to Plaintiff's Reply in Support of Motion to Remand [DE 17].

         FACTUAL AND PROCEDURAL BACKGROUND

         On September 1, 2017, Ezee Trans was hired to pick up a 2016 Mercedes Benz Sprinter Van at Specialty Gulf Coast Yard in Gulfport, Mississippi and transport the Sprinter Van to Val's in Lexington, Kentucky. [DE 1-6, at 3]. Ezee Trans loaded the Sprinter Van onto a flatbed commercial vehicle that was owned by Ezee Trans and driven by Mr. Garcia, an employee of Ezee Trans. Id. On September 2, 2017, while nearing Val's, Mr. Garcia allegedly attempted to drive the flatbed commercial vehicle under a railroad bridge, but in doing so, the Sprinter Van atop the flatbed commercial vehicle collided with the railroad bridge, resulting in damage to the Sprinter Van. Id.

         On or about January 29, 2018, Val's brought this action in Fayette Circuit Court, alleging Mr. Garcia was negligent and Ezee Trans was vicariously liable for Mr. Garcia's actions and omissions and negligently entrusted Mr. Garcia with the flatbed commercial vehicle. [DE 1-1, at 4-5]. Also, Val's asserted a claim of punitive damages against all Defendants. Id. at 5. On March 12, 2018, Val's moved for default judgment against Ezee Trans, and on or about May 24, 2018, the Fayette Circuit Court denied Val's Motion for Default Judgment. [DE 1-7]. On March 19, 2018, Ezee Trans moved to dismiss the state court action, arguing Val's claims against Ezee Trans were preempted by the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. § 14706. [DE 1-7, at 10-18]. On June 8, 2018, Val's amended its Original Complaint [DE 1-1] to add an Unfair Claims Settlement Practices Act Violation claim against new Defendant Progressive Northern Insurance Company (“Progressive”). [DE 1-6]. All other claims in the Amended Complaint [DE 1-6] remain the same as those found in the Original Complaint [DE 1-1].

         On June 18, 2018, Defendants Garcia and Progressive removed this action from the Fayette Circuit Court to this Court based on federal question jurisdiction and diversity jurisdiction. [DE 1].

         First, regarding federal question jurisdiction, Defendants Garcia and Progressive argue the following:

[This] action is a civil suit which may be removed to this Court by the Garcia and Progressive pursuant to 28 U.S.C. §1337(a) in that the Plaintiff alleges a claim involving an Act of Congress regulating commerce, to wit: a claim in excess of $10, 000 arising under the Interstate Commerce Commission Termination Act of 1995 (“ICCTA”), 49 U.S.C. §14706 (the “Carmack Amendment”) . . . Progressive intends to argue that the Carmack Amendment likewise preempts the Unfair Settlement Practices Act claim against it.

[DE 1, at 3-4 (citations omitted)]. Next, Defendants allege diversity jurisdiction, pursuant to 28 U.S.C. § 1332(a), exists because “the parties herein are citizens of different states for purposes of diversity of citizenship jurisdiction under 28 U.S.C. § 1332(a)” and “the amount in controversy exceeds $75, 000.00.” Id. at 3-6. “Ezee Trans, LLC consents to the removal of this matter to this Court, as required by 28 U.S.C. §1446(b)(2)(A).” Id. at 6.

         On June 29, 2018, Defendants Ezee Trans and Garcia moved to dismiss the Amended Complaint [DE 1-6], pursuant to Federal Rule of Civil Procedure 12(b)(6), reasserting the argument made in their state court motion to dismiss that “[t]he claims alleged against Ezee Trans and Garcia in the Amended Complaint are preempted by the Carmack Amendment to the ICC Termination Act of 1995 (“Carmack Amendment”), 49 U.S.C. § 14706 . . . .” [DE 5, at 1]. Additionally, Defendants Ezee Trans and Garcia allege Mr. Garcia cannot be liable because he is not a “carrier” under the Carmack Amendment. [DE 5-1, at 8-9].

         Following the filing of Defendants Ezee Trans and Garcia's Motion to Dismiss [DE 5], on July 3, 2018, Val's moved to remand this action to Fayette Circuit Court for several reasons. [DE 7]. First, Val's argues neither Mr. Garcia nor Progressive has a right to remove the case under 28 U.S.C. § 1337 because the only motor carrier that is a party to this case is Ezee Trans, and Ezee Trans “missed its deadline to file a Notice of Removal under the provisions of 28 U.S.C. § 1337.” Id. at 3-4. Second, Val's argues Mr. Garcia and Progressive cannot remove their case to federal court based on a federal defense, such as the defenses that Mr.

         Garcia “cannot be responsible under 28 U.S.C. § 14706, ” and “a bad faith claim [against Progressive] based on cargo damage isn't actionable by operation of 28 U.S.C. § 14706.” Id. at 4-5. Third, while admitting complete diversity exists between the Parties, Val's argues, “[N]either Mr. Garcia nor Progressive can establish that the amount in controversy requirement can be satisfied for removal under 28 U.S.C. § 1332.” Id. at 5. Positing Val's Reply 16] in Support of Motion to Remand [DE 16] “sets forth a completely new argument as to why the Carmack Amendment does not completely preempt the claims asserted against Garcia, in that he may have been acting outside the scope of his employment for Defendant Ezee Trans, LLC (‘Ezee Trans'), ” Defendants Progressive and Garcia move for leave to file a sur-reply to respond to the allegedly new argument. [DE 17].

         In addition to filing a Motion to Remand [DE 7], on July 18, 2018, Val's moved for leave to file a second amended complaint asserting a claim under the Carmack Amendment. [DE 12]. Believing it has adequately pled a violation under the Carmack Amendment, Val's seeks to file a second amended complaint to specifically assert a claim under the Carmack Amendment only out of an abundance of caution. [DE 12, at 1 (citing Vitramax Group, Inc. v. Roadway Exp., Inc., CIV.A. 05-87-C, 2005 WL 1036180, at *2 (W.D. Ky. May 3, 2005))].

         DISCUSSION

         A. DEFENDANTS EZEE TRANS AND GARCIA'S MOTION TO DISMISS AND DEFENDANTS GARCIA AND PROGRESSIVE'S MOTION FOR LEAVE TO FILE SUR-REPLY TO PLAINTIFF'S REPLY IN SUPPORT OF MOTION TO REMAND

         As previously mentioned, pursuant to Federal Rule of Civil Procedure 12(b)(6), Defendants Ezee Trans and Garcia moved to dismiss the Amended Complaint [DE 1-6] for the following two reasons: (1) Val's claims against Ezee Trans and Garcia are preempted by the Carmack Amendment; and (2) Mr. Garcia cannot be liable because he is not a “carrier” under the Carmack Amendment. [DE 5, at 1; DE 5-1, at 8-9].

         Federal Rule of Civil Procedure 12(b)(6) provides that a complaint may be attacked for failure “to state a claim upon which relief can be granted.” To survive a Rule 12(b)(6) motion to dismiss, 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 Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A motion to dismiss is properly granted if it is beyond doubt that no set of facts would entitle the petitioner to relief on his claims.” Computer Leasco, Inc. v. NTP, Inc., 194 Fed.Appx. 328, 333 (6th Cir. 2006). When considering a Rule 12(b)(6) motion to dismiss, the court will presume that all the factual allegations in the complaint are true and draw all reasonable inferences in favor of the nonmoving party. Total Benefits Planning Agency v. Anthem Blue Cross & Blue Shield, 552 F.3d 430, 434 (6th Cir. 2008) (citing Great Lakes Steel v. Deggendorf, 716 F.2d 1101, 1105 (6th Cir. 1983)). “The court need not, however, accept unwarranted factual inferences.” Id. (citing Morgan v. Church's Fried Chicken, 829 F.2d 10, 12 (6th Cir. 1987)).

         “The Carmack Amendment, enacted in 1906 as an amendment to the Interstate Commerce Act, 24 Stat. 379, 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). In relevant part, the Carmack Amendment provides:

A carrier providing transportation or service subject to jurisdiction under subchapter I or III of chapter 135 shall issue a receipt or bill of lading for property it receives for transportation under this part. That carrier and any other carrier that delivers the property and is providing transportation or service subject to jurisdiction under subchapter I or III of chapter 135 or chapter 105 are liable to the person entitled to recover under the receipt or bill of lading. The liability imposed under this paragraph is for the actual loss or injury to the property caused by (A) the receiving carrier, (B) the delivering carrier, or (C) another carrier over whose line or route the property is transported in the United States or from a place in the United States to a place in an adjacent foreign country when transported under a through bill of lading and, except in the case of a freight forwarder, applies to property reconsigned or diverted under a tariff under section 13702. Failure to issue a receipt or bill of lading does not affect the liability of a carrier. A delivering carrier is deemed to be the carrier performing the line-haul transportation nearest the destination but does not include a carrier providing only a switching service at the destination.

49 U.S.C. § 14706(a). This Court previously addressed this issue in Jackson v. Brook Ledge, Inc., 991 F.Supp. 640 (E.D. Ky. 1997). In Jackson, “Plaintiff, through his agents, requested that Brook Ledge, a common motor carrier engaged in transporting horses in interstate commerce, transport Dream Fulfilled[, a horse, ] from Florida to Kentucky. In transport, Dream Fulfilled was fatally injured.” Id. at 644. My late colleague Karl S. Forester found, “The Sixth Circuit, along with seven other circuits, have held that the Carmack Amendment preempts state and common law claims and remedies for cargo damaged in interstate transport.” Id. (citing W.D. Lawson & Co. v. Penn Central Co., 456 F.2d 419, 421 (6th Cir. 1972); Shao v. Link, Cargo (Taiwan) Limited, 986 F.2d 700, 706-707 (4th Cir. 1993); Hughes Aircraft Co. v. North American Van Lines, Inc., 970 F.2d 609, 613 (9th Cir. 1992); Underwriters of Lloyds of London v. North American Van Lines, 890 F.2d 1112, 1113 (10th Cir. 1989); Intech, Inc. v. Consolidated Freightways, Inc., 836 F.2d 672, 677 (1st Cir. 1987); Hughes v. United Van Lines, Inc., 829 F.2d 1407, 1415 (7th Cir. 1987); Hopper Furs, Inc. v. Emery Air Freight Corp., 749 F.2d 1261, 1264 (8th Cir. 1984); Air Products and Chemicals, Inc. v. Illinois Central Gulf Railroad Co., 721 F.2d 483, 486 (5th Cir. 1983)). Finding “the Carmack Amendment provides the exclusive remedy for an action for damages against a delivering carrier, ” Judge Forester dismissed “plaintiff's common law claims, to wit, negligence, recklessness, and gross negligence, and breach of agreement, as plaintiff's claims fall squarely within the exclusive ambit of the Carmack Amendment.” Jackson, 991 F.Supp. at 644.

         Here, Val's hired Ezee Trans, an undisputed common motor carrier, to transport a Sprinter Van from Mississippi to Kentucky. During transport, the Sprinter Van was damaged when Mr. Garcia, an Ezee Trans employee tasked with driving the flatbed commercial vehicle, attempted to drive under a railroad bridge and, instead, collided with the railroad bridge. Like the plaintiff in Jackson, Val's brought state law ...


Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.