Starbucks Corporation v. Amcor Packaging Distribution, et al.,
Filing
44
MEMORANDUM and ORDER granting 29 Motion to Dismiss signed by Senior Judge William B. Shubb on 11/4/14: Pallets Unlimited has twenty days from the date this Order is signed to file an amended third-party complaint, if it can do so consistent with this Order. (Kaminski, H)
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UNITED STATES DISTRICT COURT
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EASTERN DISTRICT OF CALIFORNIA
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----oo0oo----
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STARBUCKS CORPORATION, a
corporation,
CIV. NO. 2:13-1754 WBS CKD
MEMORANDUM AND ORDER RE: MOTION
TO DISMISS CROSS-COMPLAINT
Plaintiff,
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v.
AMCOR PACKAGING DISTRIBUTION,
et al.,
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Defendants.
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----oo0oo----
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Plaintiff Starbucks Corporation (“Starbucks”) filed
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this case against defendants Amcor Packaging Distribution, Amcor
22
Packaging (USA), Inc. (collectively “Amcor”), and Pallets
23
Unlimited after discovering mold on its coffee bags, coffee, and
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several wooden shipping pallets provided to Starbucks by
25
defendants.
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defendants supplied it with defective pallets that caused the
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mold.
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against each other, (Amcor Cross-cl. (Docket No. 14); Pallets
(Id.)
(Compl. ¶ 9 (Docket No. 1).)
Starbucks alleges that
Pallets Unlimited and Amcor filed cross-claims
1
1
Cross-cl. (Docket No. 15)), and Pallets Unlimited later filed a
2
“cross-claim”1 against third-party defendant Ozburn-Hessey
3
Logistics (“OHL”).
4
moves to dismiss the claims against it.
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I.
(Pallets Compl. (Docket No. 25).)
OHL now
Factual and Procedural History
6
Amcor allegedly sold Starbucks 9,480 wooden pallets,
7
used to store and transport almost 70,000 bags of unroasted
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Starbucks coffee beans.
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hired by Amcor to “manufacture[], assemble[] or provide” some or
(Compl. ¶¶ 8-9.)
10
all of the pallets.
11
Starbucks also hired OHL to provide warehouse services for
12
Starbucks products.
13
(Id. ¶ 8.)
Pallets Unlimited was
Under a separate contract,
(Pallets Compl. ¶ 11.)
Starbucks alleges the pallets used to transport and
14
store its beans were defective because they did not meet the
15
specifications in Starbucks’s contract with Amcor, and “as a
16
result, excessive moisture was present in the pallets, which
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caused mold to develop in pallets and the coffee bags and
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[coffee], which were in direct contact with the faulty pallets.”
19
(Compl. ¶ 9.)
20
Unlimited for strict product liability, breach of warranty, and
21
negligence, as well as a claim against Amcor for breach of
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27
28
1
Starbucks asserts claims against Amcor and Pallets
Because OHL was not previously a party to the case and
its liability is allegedly derivative of Pallets Unlimited’s,
this pleading is more accurately called a “third-party
complaint.” See Fed. R. Civ. P. 14(a)(1) (“A defending party
may, as a third-party plaintiff, serve a summons and complaint on
a nonparty who is or may be liable to it for all or part of the
claim against it.”); see also United States v. One 1977 Mercedes
Benz, 708 F.2d 444, 452 (9th Cir. 1983) (“[A] third-party claim
may be asserted only when the third party’s liability is in some
way dependent on the outcome of the main claim and the third
party’s liability is secondary or derivative.”).
2
1
contract.
2
(Id. ¶¶ 13-38.)
On July 22, 2014, Pallets Unlimited filed a third-party
3
complaint against OHL alleging that it delivered wooden pallets
4
to OHL’s warehouse starting in December 21, 2011, and at that
5
time, none of the pallets contained mold.
6
9.)
7
them out to various locations determined by Starbucks.
8
13)
9
they were “properly stored and protected from the elements such
(Pallets Compl. ¶¶ 8-
OHL then stored the pallets at its facility until sending
(Id. ¶
During this time, OHL was allegedly responsible for ensuring
10
that they would not develop any mold.”
(Id.)
Pallets Unlimited
11
alleges that, because “the pallets and coffee beans at issue were
12
stored in the sole possession of OHL, . . . the mold likely
13
developed as a result of the storage conditions at the
14
[warehouse].”
(Id. ¶ 14.)
15
Based on these allegations, Pallets Unlimited brings
16
four claims against OHL: (1) full indemnification, (2) partial
17
indemnification, (3) negligence, and (4) declaratory relief.
18
(Id. ¶¶ 15-27.)
19
Federal Rule of Civil Procedure 12(b)(6) for failure to state a
20
claim upon which relief can be granted.
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II.
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OHL moves to dismiss all four claims pursuant to
Legal Standard
On a motion to dismiss for failure to state a claim
23
under Rule 12(b)(6), the court must accept the allegations in the
24
pleadings as true and draw all reasonable inferences in favor of
25
the third-party plaintiff.
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236 (1974), overruled on other grounds by Davis v. Scherer, 468
27
U.S. 183 (1984); Cruz v. Beto, 405 U.S. 319, 322 (1972).
28
survive a motion to dismiss, a plaintiff must plead “only enough
See Scheuer v. Rhodes, 416 U.S. 232,
3
To
1
facts to state a claim to relief that is plausible on its face.”
2
Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007).
3
“plausibility standard,” however, “asks for more than a sheer
4
possibility that a defendant has acted unlawfully,” and where a
5
plaintiff pleads facts that are “merely consistent with a
6
defendant’s liability,” it “stops short of the line between
7
possibility and plausibility.”
8
678 (2009) (quoting Twombly, 550 U.S. at 557).
9
III. Pallets Unlimited’s Claims for Full or Partial Indemnity
10
A.
This
Ashcroft v. Iqbal, 556 U.S. 662,
Judicial Notice of the “OHL Agreement”
11
In general, a court may not consider items outside the
12
pleadings when deciding a motion to dismiss, but it may consider
13
items of which it can take judicial notice.
14
F.3d 1370, 1377 (9th Cir. 1994).
15
motion to dismiss may consider a document the authenticity of
16
which is not contested, and upon which the plaintiff’s complaint
17
necessarily relies.”
18
(9th Cir. 1998), superseded by statute on other grounds as stated
19
in Abrego Abrego v. The Dow Chem. Co., 443 F.3d 676, 681-82 (9th
20
Cir. 2006).
21
“[p]revent[] plaintiffs from surviving a Rule 12(b)(6) motion by
22
deliberately omitting references to documents upon which their
23
claims are based.”
24
Barron v. Reich, 13
“A district court ruling on a
Parrino v. FHP, Inc., 146 F.3d 699, 706
The policy underlying this rule seeks to
Parrino, 146 F.3d at 706.
Through the “incorporation by reference” doctrine, the
25
court may also “take into account documents . . . alleged in a
26
complaint and whose authenticity no party questions, but which
27
are not physically attached to the [plaintiff’s] pleading . . .
28
even though the plaintiff does not explicitly allege the contents
4
1
of that document in the complaint.”
2
1068, 1076 (9th Cir. 2005) (quotation marks and citations
3
omitted).
4
complaint, and thus may assume that its contents are true for
5
purposes of a motion to dismiss under Rule 12(b)(6).’”
6
HSBC Bank Nevada, N.A., 691 F.3d 1152, 1160-61 (9th Cir. 2012)
7
(quoting United States v. Ritchie, 342 F.3d 903, 908 (9th Cir.
8
2003)).
9
Knievel v. ESPN, 393 F.3d
“A court ‘may treat such a document as part of the
Davis v.
In its third-party complaint, Pallets Unlimited alleges
10
that “OHL had a contract with [Starbucks] whereby OHL agreed to
11
store the wooden pallets at issue . . . at the [warehouse].”
12
(Pallets Compl. ¶ 11.)
13
the contract (“OHL Agreement”) which it represents contains the
14
terms by which “OHL provided warehouse services to Starbucks”
15
regarding the pallets and coffee at issue.
16
(Docket No. 29); OHL’s Req. for Judicial Notice Ex. 5 (Docket No.
17
30-5)).
18
Unlimited’s pleading refers.
19
OHL has provided the court with a copy of
(OHL’s Mem. at 3
OHL represents this is the contract to which Pallets
(OHL’s Mem. at 3.)
OHL and Starbucks both agree that the OHL Agreement is
20
authentic.
In fact, they have provided the court with two
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declarations affirming its authenticity: one from Frank Eichler,
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chief administrative officer and general counsel of OHL, (OHL’s
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Reply Ex. 1, Eichler Decl. (Docket No. 40-1)), and one from Jeff
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Ferrell, sourcing category manager at Starbucks, (Starbucks’s
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Response Ex. 1, Ferrell Decl. (Docket No. 42-1)).
26
Starbucks has requested that the court file the OHL Agreement
27
under seal, citing “proprietary, commercially sensitive and
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private information regarding Starbucks vendor relationship,
5
Moreover,
1
facilities’ locations, operational specifications and procedures,
2
costs, metrics, pricing, business practices and other similar
3
proprietary information relating to Starbucks warehousing and
4
service requirements.”
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Agreement is what it purports to be.
6
This request further suggests that the
Nevertheless, despite the fact that its pleading makes
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reference to “a contract . . . whereby OHL agreed to store the
8
wooden pallets” in its pleading, Pallets Unlimited does not agree
9
that the document which has been provided is the relevant
10
contract.
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Unlimited argues that its allegation was a “speculative
12
reference” based only upon “information and belief” that “a
13
contract” existed.
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argues, “Pallets Unlimited was unaware of any actual contract
15
between OHL and Starbucks, much less the specific OHL Agreement
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sought to be relied upon.”
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OHL Agreement were quoted or paraphrased specifically in the
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pleading, however, and Pallets Unlimited asserts that its limited
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reference to “a contract” did not sufficiently refer to this
20
contract to consider it incorporated by reference.2
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(See Pallets’s Opp’n at 4-7 (Docket No. 38).)
(Id. at 4-6.)
Pallets
At the time of pleading, it
(Id. at 5.)
None of the terms of the
(Id. at 6.)
Accordingly, although Pallets Unlimited has offered no
2
Pallets Unlimited also offers several “procedural and
evidentiary objections” to considering the OHL Agreement. (Id.
at 4, 6 n.1 (citing Fed. Rs. Evid. 401, 402, 803, 901, 902).)
Presumably, these objections would become relevant if the court
were to convert OHL’s motion to dismiss into one for summary
judgment. See Parrino, 146 F.3d at 706 n.4 (“[W]here a defendant
attaches extrinsic evidence to a Rule 12(b)(6) motion, the court
ordinarily must convert that motion into one for summary judgment
under Rule 56 to give the plaintiff an opportunity to respond.”).
The court sees no reason to convert OHL’s motion, and thus, does
not address these objections further.
6
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concrete reason for doubting its authenticity, the parties’
2
disagreement regarding whether the OHL Agreement applies to the
3
facts alleged prevents the court from considering it for purposes
4
of this motion to dismiss.
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(allowing consideration of documents “whose authenticity no party
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questions” on a motion to dismiss); Parrino, 146 F.3d at 706
7
(same).
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B.
9
See Knievel, 393 F.3d at 1076
The court will thus not consider the OHL Agreement.
Equitable Indemnity
Under California law, indemnity may be either “express
10
indemnity,” which refers to an express contract term providing
11
for indemnification, or “equitable indemnity,” which embraces
12
traditional equitable indemnity and implied contractual
13
indemnity.
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1157-60 (2009) (reviewing the historical forms of indemnity under
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California law). Pallets Unlimited does not allege the existence
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of a contract between it and OHL, leaving only the possibility of
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equitable indemnity.
18
Prince v. Pac. Gas & Elec. Co., 45 Cal. 4th 1151,
See id.
Equitable indemnity allows a defendant to “seek
19
apportionment of loss between the wrongdoers in proportion to
20
their relative culpability.”
21
of San Diego, Inc., 213 Cal. App. 3d 419, 426 (4th Dist. 1989).
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To state a claim for equitable indemnity, plaintiff must make:
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“(1) a showing of fault on the part of the indemnitor and (2)
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resulting damages to the indemnitee for which the indemnitor is
25
. . . equitably responsible.”
26
App. 4th 206, 217 (1st Dist. 2011).
27
28
Gem Developers v. Hallcraft Homes
Bailey v. Safeway, Inc., 199 Cal.
Crucially, California law requires that, “[w]ith
limited exception, there must be some basis for tort liability
7
1
against the proposed indemnitor . . . generally based on a duty
2
owed to the underlying plaintiff.”3
3
Inc. v. Forcum/Mackey Constr., Inc., 119 Cal. App. 4th 848, 852-
4
53 (4th Dist. 2004) (“Without any action sounding in tort, there
5
is no basis for a finding of potential joint and several
6
liability . . . thereby precluding a claim for equitable
7
indemnity.”); see Stop Loss Ins. Brokers, Inc. v. Brown & Toland
8
Med. Grp., 143 Cal. App. 4th 1036, 1040-41 (1st Dist. 2006) (“The
9
question is whether, with respect to the claims analysis, [the
BFGC Architects Planners,
10
indemnitor] owed [the plaintiff] a duty of care sounding in
11
tort.”).
12
First, equitable indemnity requires two or more parties to share
13
a “joint legal obligation” or become “jointly or severally
14
liable” to the same plaintiff.
15
Stop Loss, 143 Cal. App. 4th at 1040.
16
does not permit equitable apportionment of damages for breach of
17
contract . . . .”
18
This rule appears to follow from two principles.
See Prince, 5 Cal. 4th at 1158;
Second, “California law
Stop Loss, 143 Cal. App. 4th at 1041 n.2.
Ordinary breach of contract, without something more,
19
will thus not support equitable indemnity because, “[a]lthough in
20
some circumstances the same act may support both contract and
21
tort liability, [the California Supreme Court] held that ‘breach
22
of contract becomes tortious only when it also violates a duty
23
independent of the contract arising from principles of tort
24
law.’”
25
No. 14-00930 JCS, 2014 WL 4364393, at *4 (N.D. Cal. Aug. 29,
Tesoro Ref. & Mktg. Co. LLC v. Pac. Gas & Elec. Co., Civ.
26
27
28
3
The exceptions apply to vicarious liability, strict
liability, and implied contractual indemnity. See BFGC, 119 Cal
App. 4th at 852.
8
1
2014) (quoting Erlich v. Menezes, 21 Cal. 4th 543, 551-52
2
(1999)).
3
liability in tort where
4
5
6
7
8
9
For example, breach of contract may also give rise to
(1) the breach is accompanied by a traditional common law
tort, such as fraud or conversion; (2) the means used to
breach the contract are tortious, involving deceit or undue
coercion or; (3) one party intentionally breaches the
contract intending or knowing that such a breach will cause
severe, unmitigable harm in the form of mental anguish,
personal hardship, or substantial consequential damages.
Erlich, 21 Cal. 4th at 551-52.
However, “mere negligent breach
10
of contract” is not sufficient to impose tort liability under
11
California law.
12
(rejecting the argument that “equitable indemnity is appropriate
13
for negligent performance of contractual obligations” under
14
California law).
Id.; see also Tesoro, 2014 WL 4364393, at *4-5
Pallets Unlimited’s third-party complaint appears to
15
16
allege that OHL owed Starbucks a duty of care regarding the
17
storage conditions of the pallets, but it leaves the source of
18
this duty ambiguous.
19
an effort to support a duty of care as between OHL and Starbucks.
20
First, it alleges that “OHL had a contract with [Starbucks]
21
whereby OHL agreed to store the wooden pallets at issue . . . at
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the [warehouse].”4
23
alleges that “OHL was responsible for ensuring that the wooden
24
pallets and coffee beans were properly stored and protected from
25
26
27
28
4
In particular, it makes two allegations in
(Pallets Compl. ¶ 11.)
And second, it
As explained above, the court does not consider the
specific terms of this alleged contract. It only assumes the
truth of this allegation on its face--that is, it assumes that
some contractual relationship existed between OHL and Starbucks
with regard to storage of the wooden pallets at issue--as it must
for purposes of this motion. See Scheuer, 416 U.S. at 236.
9
1
the elements such that they would not develop any mold,” (id. ¶
2
13.), and through its “negligence or fault,” allowed mold to
3
develop, (id. ¶¶ 20, 22).
4
With regard to the alleged “contract . . . to store the
5
wooden pallets at issue,” (id. ¶ 11.), the third-party complaint
6
describes a contractual duty, not a duty “sounding in tort.”
7
Because California law does not recognize claims of equitable
8
indemnity premised on a contractual duty, the third-party
9
complaint does not state a claim for indemnity upon which relief
10
can be granted on that ground.
See BFGC Architects, 119 Cal.
11
App. 4th at 852-53; Stop Loss, 143 Cal. App. 4th at 1040-41.
12
Setting the allegation of a contract aside, nothing in
13
Pallets Unlimited’s pleading supports any viable theory that OHL
14
owed and breached a duty to Starbucks in tort.
15
that “OHL was responsible for ensuring that the wooden pallets
16
and coffee beans were properly stored and protected from the
17
elements” is a conclusory allegation not entitled to deference
18
under Iqbal.
19
555).
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“negligent” or at “fault.”
21
that might aid the court in uncovering a duty owed by OHL to
22
Starbucks.
23
allowing this court to identify the source for any such duty in
24
tort.
25
The allegation
See 556 U.S. at 678 (quoting Twombly, 550 U.S. at
The same is true of the allegation that OHL was
Neither allegation contains facts
Pallets Unlimited thus fails to allege any facts
The court finds this case comparable to the recent
26
situation faced by Magistrate Judge Spero in Tesoro.
See Tesoro,
27
2014 WL 4364393.
28
& Marketing Company LLC (“Tesoro”) sued Pacific Gas and Electric
In Tesoro, underlying plaintiff Tesoro Refining
10
1
Company (“PG & E”) after a loss of electrical power to its
2
refinery forced a temporarily shut down.
3
turn sued Foster Wheeler Martinez, Inc. and Martinez Cogen
4
Limited Partnership (collectively, “FWM”), which also provided
5
electricity to Tesoro’s refinery, for equitable indemnity.
6
FWM argued that equitable indemnity was not available because (1)
7
a contract between FWM and Tesoro absolved it of liability to
8
Tesoro and (2) PG & E had not adequately alleged that FWM was
9
liable to Tesoro in tort.
Id. at *1.
PG & E in
Id.
After concluding PG & E could not base
10
its claim upon the contract, id. at *3-5, the court set aside the
11
existence of the contract and surveyed California law for any
12
“independent tort duty” upon which to base equitable indemnity,
13
id. at *5-6.
14
in negligence for a duty in these circumstances.
15
Cal. Civ. Code § 1714(a); Langley v. Pac. Gas & Elec. Co., 41
16
Cal. 2d 655, 660 (1953)).
17
any source not considered in Tesoro.
18
12.)
19
It concluded that California law afforded no basis
Id. (citing
Pallets Unlimited fails to point to
(See Pallets’s Opp’n at 11-
While some set of facts may allow Pallets Unlimited to
20
show that OHL’s actions at the facility give rise to an
21
independent tort or even “both contract and tort liability,” id.
22
at *4, it has not done so on the facts alleged.
23
is no “joint legal obligation” or basis for “joint and several
24
liability” to Starbucks in these allegations.
25
4th at 1158; Stop Loss, 143 Cal. App. 4th at 1040.
26
the court will grant OHL’s motion to dismiss these claims.
27
IV.
28
That is, there
See Prince, 5 Cal.
Accordingly,
Pallets Unlimited’s Negligence Claim
To state a claim for negligence under California law, a
11
1
plaintiff must allege duty, breach, causation, and damages.
2
Conroy v. Regents of Univ. of Cal., 45 Cal. 4th 1244, 1250
3
(2009).
4
negligence is the existence of a duty to use due care toward an
5
interest of another . . . .
6
has been satisfied in a particular case is a question of law.”
7
Glenn K. Jackson, Inc. v. Roe, 273 F.3d 1192, 1196–97 (9th Cir.
8
2001) (quoting Adelman v. Associated International Insurance Co.,
9
90 Cal. App. 4th 352, 360 (2001)).
10
“[T]he threshold element of a cause of action for
Whether this essential prerequisite
Because the court need not simply accept “a conclusory
11
assertion that [OHL] ‘owed a duty of care,’” see Fimbres v.
12
Chapel Mortgage Corp., Civ. No. 09-0886 IEG POR, 2009 WL 4163332,
13
at *7 (S.D. Cal. Nov. 20, 2009) (citing Iqbal, 556 U.S. 662.), it
14
must determine whether Pallets Unlimited alleges facts sufficient
15
to establish that OHL actually owed it a duty.
16
alleges two possible duties on which it predicates its negligence
17
claim: (1) a general duty of care owed by all owners of property-
18
-sometimes called “premises liability”--and (2) a duty to notify.
19
20
21
A.
Pallets Unlimited
Pallets Unlimited Fails to Allege Facts Supporting
Premises Liability
Pallets Unlimited alleges that “OHL owed a duty . . .
22
to store the coffee beans and pallets at issue at its [warehouse]
23
at or above the standard of care in the industry, which includes
24
storing them in such a way that mold would not develop . . .”
25
(Pallets Compl. ¶ 18.)
26
“premises liability” faced by all property owners in California.
27
(See Pallets’s Opp’n at 10.)
28
this duty, Pallets Unlimited alleges that it “suffered damages
This duty arises, it contends, from
And as a result of OHL’s breach of
12
1
including, but not limited to, potential liability to
2
[Starbucks].”
3
4
5
6
7
8
9
10
11
12
13
14
15
16
17
18
19
20
21
22
23
24
25
26
27
28
(Pallets Compl. ¶ 18).
California Civil Code section 1714(a) provides, in
part:
Everyone is responsible, not only for the result of his or
her willful acts, but also for an injury occasioned to
another by his or her want of ordinary care or skill in the
management of his or her property or person, except so far
as the latter has, willfully or by want of ordinary care,
brought the injury upon himself or herself.
Cal. Civ. Code § 1714(a); see also Cabral v. Ralphs Grocery Co.,
51 Cal. 4th 764, 771 (2011) (“The general rule in California is
that ‘[e]veryone is responsible . . . for an injury occasioned to
another by his or her want of ordinary care or skill in the
management of his or her property or person.’” (quoting Cal. Civ.
Code § 1714(a))).
Courts have understood this subsection to
impose a “duty to use ordinary care,” which makes an individual
“liable for injuries caused by his failure to exercise reasonable
care in the circumstances.”
Cabral, 51 Cal. 4th at 771 (quoting
Parsons v. Crown Disposal Co., 15 Cal. 4th 456, 472 (1997)).
“Premises liability” is generally invoked for the idea
that landowners or possessors have a duty to avoid subjecting
others to a risk of bodily injury or property damage.
See, e.g.,
Brooks v. Eugene Burger Mgmt. Corp., 215 Cal. App. 3d 1611, 161924 (5th Dist. 1989) (involving bodily injury to a child allegedly
caused by inadequate fencing around a roadway); Wilson v. Rancho
Sespe, 207 Cal. App. 2d 10, 17 (2d Dist. 1962) (stating that
premises liability “is applicable also with respect to liability
for damage to property”); see also Cal. Civ. Prac. Torts § 16:1
(“The term ‘premises liability’ refers to the liability of
13
1
certain persons for injuries and damages to others arising from
2
the ownership or possession of real property.”).
3
However, Pallets Unlimited does not allege injury to
4
its person or property.
5
over the wooden pallets at issue while they were stored at OHL’s
6
warehouse.5
7
“constructed by” Pallets Unlimited, (Pallets Compl. ¶¶ 8-9, 11,
8
13-14, 18), but makes no mention of whether it retained ownership
9
of the pallets or transferred them to Starbucks upon delivery.
10
In fact, it does not allege ownership
It repeatedly alleges that the pallets were
Moreover, and perhaps more tellingly, Pallets Unlimited
11
does not allege that it suffered damages in the form of harm to
12
its pallets.
13
liability” to Starbucks, (id. ¶ 18), which would presumably
14
consist of a money judgment against it, as well as “damages
15
relating to attorney’s fees and costs of suit herein,” (id.
16
¶ 17).
17
better understood as a duty to protect it from the prospect of
18
purely economic loss it now faces as a result of Starbucks’s
19
claims against it.
20
21
22
23
24
25
26
27
28
It alleges damages solely in the form of “potential
Any duty allegedly owed to Pallets Unlimited is thus
Pallets Unlimited has not provided, and the court
cannot find, any basis in California law for such a duty.6
5
If
Pallets Unlimited states in its opposition brief that
OHL breached its duty as a premises owner “to ensure that Pallets
Unlimited’s wooden pallets and Starbuck’s [sic] coffee beans”
were properly stored. (Pallets’s Opp’n at 9.) While this could
be construed as a statement of ownership, the court may not
consider any material other than the challenged pleadings for
purposes of this motion, see Arpin v. Santa Clara Valley Transp.
Agency, 261 F.3d 912, 925 (9th Cir. 2001), and no similar
allegations appear in Pallets Unlimited’s complaint.
6
During oral argument, Pallets Unlimited points to
14
1
anything, California law appears to point in the opposite
2
direction.
3
Guaranty Co., the California Supreme Court stated that
For instance, in Quelimane Co. v. Stewart Title
8
In the business arena it would be unprecedented to impose a
duty on one actor to operate its business in a manner that
would ensure the financial success of transactions between
third parties. With rare exceptions, a business entity has
no duty to prevent financial loss to others with whom it
deals directly.
A fortiori, it has no greater duty to
prevent financial losses to third parties who may be
affected by its operations.
9
19 Cal. 4th 26, 59 (1998) (considering whether CPA auditors’ duty
4
5
6
7
10
of care in the preparation of an independent audit of a client's
11
financial statements extends to persons other than the client);
12
see also Glenn K. Jackson Inc., 273 F.3d at 1196-99 (surveying
13
California law on the existence of a legal duty of one party to
14
another in the absence of privity of contract between them).
In fact, a California Court of Appeal recently rejected
15
16
a similar attempt to raise a negligence claim “through the
17
backdoor.”7
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1338 (4th Dist. 2014).
19
motorhome sued both the manufacturer of an allegedly defective
20
Campbell v. Ford Motor Co., 206 Cal. App. 4th 15 (2012), for
support. The court finds no support for its position in
Campbell. In fact, Campbell declined to find a duty in the
circumstances of that case, holding that “a property owner has no
duty to protect family members of workers on its premises from
secondary exposure to asbestos used during the course of the
property owner’s business.” Id. at 34.
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23
24
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26
27
28
Mega RV Corp. v. HWH Corp., 225 Cal. App. 4th 1318,
In Mega RV Corp., the owners of a
The court also noted that the claim of negligence it
analyzed arose “in an indemnity cause of action . . . in a case
in which there was nothing to indemnify” because the other
defendant had settled with the underlying plaintiff. Mega RV
Corp., 225 Cal. App. 4th at 1338 n.15. Pallets Unlimited’s claim
can be construed as a similar tactic, attempting to salvage its
indemnity claim using allegations of negligence.
15
1
hydraulic part and a company that provided ineffective repair
2
services.
3
complaint against the repairer for negligence, equitable
4
indemnity, and declaratory relief--the same claims at issue here.
5
Id. at 1324.
6
claim of negligence on an alleged duty that the repairer owed to
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it and breached while servicing the owner’s motorhome.
8
1338.
9
Id. at 1322-24.
The manufacturer filed a cross-
Also like here, the manufacturer predicated its
Id. at
The court rejected this position “as a matter of law”
10
because “[the manufacturer] did not suffer personal injury or
11
injury to other property as a result of [the repairer’s] alleged
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tort.”
13
only asserted that it “suffered consequential economic damages”
14
by being forced to defend against the owner’s claim.
15
Pallets’s Compl. ¶ 18).
16
under those circumstances, “where the wrong has resulted only in
17
economic loss rather than damage to person or property.”
18
Corp., 225 Cal. App. 4th at 1338 (citing Robinson Helicopter Co.,
19
Inc. v. Dana Corp., 34 Cal. 4th 979, 988–993 (2004) (discussing
20
tort claims for economic loss generally)).
21
declined to create one.
22
from J’Aire Corp. v. Gregory, 24 Cal. 3d 799 (1979)).
23
Id. at 1338.
Like Pallets Unlimited, the manufacturer
Id.;(see
No previously recognized tort existed
Mega RV
And the court
Id. at 1340-42 (applying the six factors
Similarly, this court concludes there is no basis in
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California law or in the facts alleged by Pallets Unlimited for
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such a duty.
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B.
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Pallets Unlimited Fails to Allege Facts Supporting a
Duty to Notify
Pallets Unlimited further alleges that OHL owed a duty
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1
to notify it “of any specifications required of the pallets that
2
are unique to the pallets ordered by Starbucks,” such as a
3
limited moisture content.
4
Unlimited makes no mention of this allegation in its opposition
5
brief, raising the possibility that it abandons this position.
6
The court thus gives only brief consideration to this theory.
7
See Conservation Force v. Salazar, 677 F. Supp. 2d 1203, 1211
8
(N.D. Cal. 2009) (offering only brief consideration to a claim
9
“[w]here plaintiffs fail to provide a defense for a claim in
(Pallets Compl. ¶ 17.)
Pallets
10
opposition”) (citing Locricchio v. Office of U.S. Trustee, 313
11
Fed. Appx. 51, 52 (9th Cir. 2009)).
12
“A duty to disclose facts arises only when the parties
13
are in a relationship that gives rise to the duty, such as
14
‘seller and buyer, employer and prospective employee, doctor and
15
patient, or parties entering into any kind of contractual
16
agreement.’”
17
2000) (citing Wilkins v. Nat’l Broad. Co., 71 Cal. App. 4th 1066,
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1082 (2d Dist. 1999)).
19
real estate agents an affirmative duty to disclose certain
20
information to those who “enter into a discussion with a real
21
estate agent regarding a real estate transaction” even in the
22
absence of a contract between them.
23
§ 2079.16.
24
Shin v. Kong, 80 Cal. App. 4th 498, 509 (1st Dist.
For example, California law imposes on
See Cal. Civ. Code
Pallets Unlimited’s complaint fails to allege facts
25
supporting a special relationship between it and OHL.
26
only that a duty to disclose “was owed to [it] by OHL
27
individually and as an agent of [Starbucks].”
28
17.)
Its states
(Pallets Compl. ¶
Even assuming that OHL was an agent of Starbucks, however,
17
1
this allegation asserts a relationship between OHL and Starbucks,
2
not between OHL and Pallets Unlimited.
3
App. 4th 498 (2000) (“[A] plaintiff’s action must be founded on a
4
duty owed to the plaintiff; not a duty owed only to some other
5
person. . . . ‘Negligence in the air, so to speak, will not do.’”
6
(quoting Prosser & Keeton, Torts § 53 (5th ed. 1984))).
7
alleged facts that support some kind of special relationship
8
between Pallets Unlimited and OHL, the court cannot conclude that
9
OHL owed a duty to disclose.
10
See Shin v. Kong, 80 Cal.
Absent
Accordingly, because Pallets Unlimited fails to allege
11
facts that support a duty of care owed to it by OHL, the court
12
must grant OHL’s motion to dismiss this claim.
13
V.
Pallets Unlimited’s Claim for Declaratory Relief
14
A court may grant declaratory relief where there is “a
15
case of actual controversy within its jurisdiction,” subject to
16
certain exceptions.
17
the rights and other legal relations of any interested party
18
seeking such declaration, whether or not further relief is or
19
could be sought.”
20
28 U.S.C. § 2201(a).
The court may “declare
Id.
However, “[c]laims for declaratory relief are not
21
independent causes of action, but rather the ultimate prayer for
22
relief.”
23
TLN DA, 2013 WL 6491528, at *4 (E.D. Cal. Dec. 10, 2013) (Nunley,
24
J.).
25
viable underlying claim, so when the underlying claim is
26
dismissed, the declaratory relief cause of action must be
27
dismissed as well.”
28
Harris, Inc., Civ. No. 2:13-00325 WBS, 2013 WL 2145961, at *7
Bates v. Suntrust Mortgage, Inc., Civ. No. 2:13-01402
“A plaintiff is not entitled to such relief without a
Id.; Allied Prop. & Cas. Ins. Co. v. Dick
18
1
(E.D. Cal. May 15, 2013) (dismissing a claim for declaratory
2
relief because plaintiff could not state any other claim).
3
Accordingly, because Pallets Unlimited has not stated a
4
claim for relief against OHL, its request for declaratory
5
judgment must also be dismissed.
6
IT IS THEREFORE ORDERED that third-party defendant
7
Ozburn-Hessey Logistics’s motion to dismiss be, and the same
8
hereby is, GRANTED.
9
Pallets Unlimited has twenty days from the date this
10
Order is signed to file an amended third-party complaint, if it
11
can do so consistent with this Order.
12
Dated:
November 4, 2014
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