Genuine Energy, Inc. v. Hapag-Lloyd (America), LLC

Filing 40

ORDER: Hapag-Lloyd's Motion for Summary Judgment, or in the alternative, Motion for Partial Summary Judgment 16 is DENIED without prejudice as premature, Genuine Energy's Motion to Continue 18 is GRANTED, and Hapag-Lloyd's Motion to Stay 33 is DENIED as moot. Signed by Judge Thomas W. Thrash, Jr. on 7/26/24. (ces)

IN THE UNITED STATES DISTRICT COURT
FOR THE NORTHERN DISTRICT OF GEORGIA
ATLANTA DIVISION
GENUINE ENERGY, INC.,
Plaintiff,
v.

CIVIL ACTION FILE
NO. 1:23-CV-5239-TWT

HAPAG-LLOYD
AKTIENGESELLSCHAFT,
Defendant.

OPINION AND ORDER
This is a maritime contract case. It is before the Court on Defendant
Hapag-Lloyd Aktiengesellschaft (“Hapag-Lloyd”)’s Motion for Summary
Judgment, or in the alternative, Motion for Partial Summary Judgment [Doc.
16], Plaintiff Genuine Energy, Inc. (“Genuine Energy”)’s Motion to Continue
[Doc. 18], and Hapag-Lloyd’s Motion to Stay [Doc. 33]. As detailed below,
Hapag-Lloyd’s Motion for Summary Judgment, or in the alternative, Motion
for Partial Summary Judgment [Doc. 16] is DENIED as premature, Genuine
Energy’s Motion to Continue [Doc. 18] is GRANTED, and Hapag-Lloyd’s
Motion to Stay [Doc. 33] is DENIED as moot.
I.

Background 1

The operative facts on the Motion for Summary Judgment are taken
from the parties’ Statements of Undisputed Material Facts and the responses
thereto. The Court will deem the parties’ factual assertions, where supported
by evidentiary citations, admitted unless the respondent makes a proper
objection under Local Rule 56.1(B).
1

This case involves the shipment of 26 containers of soybeans that
allegedly became spoiled by the time the shipper’s consignees obtained them.
Genuine Energy was the shipper, and Hapag-Lloyd was the carrier. (See Def.’s
Statement of Undisputed Material Facts ¶ 1; Pl.’s Statement of Additional
Facts ¶ 1). The 679 metric tons of soybeans were being shipped to Qingdao,
China in two separate shipments. (Pl.’s Statement of Additional Facts ¶ 1;
Def.’s Statement of Undisputed Material Facts ¶ 2). According to documents
from Genuine Energy’s freight forwarder, the shipments were originally
supposed to arrive at Qingdao on May 24, 2022 and June 8, 2022. (Pl.’s Br. in
Opp’n to Mot. for Summ. J., Ex. B, Doc. 19-8; Ex. C, Doc. 19-9). They did not
arrive until June 2022 and July 2022. (Def.’s Statement of Undisputed
Material Facts ¶ 3). The containers were released on October 27, 2022. (Def.’s
Br. in Supp. of Mot. for Summ. J., Ex. 6, Doc. 16-6). They were not picked up
by the consignee until at least November 21, 2022. (Pl.’s Br. in Opp’n to Mot.
for Summ. J., Ex. Q, Doc. 19-28).
Genuine Energy asserts that the delays were caused by the Chinese
government issuing a COVID-19-related lockdown and by Hapag-Lloyd
overbooking vessels, failing to promptly correct errors on the bills of lading,
and refusing to release the cargo to customs while wrongly asserting that
Genuine Energy had outstanding charges. (Pl.’s Statement of Additional Facts
¶¶ 4, 9, 10, 11). It further asserts that the containers remained Hapag-Lloyd’s
2

responsibility until after they cleared customs, which—according to Genuine
Energy—occurred on November 21, 2022. (Id. ¶¶ 7, 9). Hapag-Lloyd denies
that it overbooked vessels, failed to promptly correct bills of lading, or refused
to release the containers. (Def.’s Resp. to Pl.’s Statement of Additional Facts
¶¶ 4, 9, 10). Rather, “[a]ny alleged delay in clearing customs was the result of
the actions or inaction of Plaintiff and/or its freight forwarder.” (Id. ¶ 9).
Genuine Energy filed suit on November 14, 2023, seeking damages sustained
by the delay. (Def.’s Statement of Undisputed Material Facts ¶ 8). 2 It asserts
a claim under the Carriage of Goods by Sea Act (“COGSA”) and a breach of
contract claim. (First Am. Compl. ¶¶ 20-38).
II.
Summary

judgment

is

Legal Standard
appropriate

only

when

the

pleadings,

depositions, and affidavits submitted by the parties show that no genuine issue
of material fact exists, and that the movant is entitled to judgment as a matter
of law. Fed. R. Civ. P. 56(a), (c). The court should view the evidence and draw
any inferences in the light most favorable to the nonmovant. Adickes v. S.H.

Kress & Co., 398 U.S. 144, 158-59 (1970). The party seeking summary
judgment must first identify grounds that show the absence of a genuine issue
of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323-24 (1986). The

As a reminder for any future summary judgment motions, the Court
“will not consider any fact . . . set out only in the brief and not in the movant’s
statement of undisputed facts.” N.D. Ga. Local R. 56.1(B)(1).
3
2

burden then shifts to the nonmovant, who must go beyond the pleadings and
present affirmative evidence to show that a genuine issue of material fact
exists. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 257 (1986).
III.

Discussion

Hapag-Lloyd moves for summary judgment on Genuine Energy’s
COGSA claim because it asserts the case was not filed within the one-year
statute of limitations period. Alternatively, Hapag-Lloyd moves for partial
summary judgment limiting the damages for the claim to $500 per package
under COGSA’s liability limit provision. Genuine Energy argues that there is
a genuine issue of material fact, and—to the extent that there is not—the
motions should be denied as premature given the infancy of the case. The Court
responds to each argument in turn below.
A. Statute of Limitations
Hapag-Lloyd moves for summary judgment on the entirety of the
COGSA claim as barred by the statute of limitations. COGSA states in relevant
part that, “[i]n any event the carrier and the ship shall be discharged from all
liability in respect of loss or damage unless suit is brought within one year
after delivery of the goods or the date when the goods should have been
delivered.” 46 U.S.C. § 30701 (Note § 3(6)). 3 Genuine Energy filed its

“For most of its life, from its 1936 enactment to the 2006 recodification
of Title 46, COGSA was codified at 46 U.S.C. § 1300-15 or 46 U.S.C. app.
§ 1300-15. It is now an uncodified statute. The sole authority for COGSA is (as
4
3

Complaint on November 14, 2023. The parties dispute whether “delivery”
occurred more than one year prior to that date. Hapag-Lloyd argues that it did;
Genuine Energy contends it did not. The Court finds that summary judgment
is not proper at this time.
As an initial matter, Genuine Energy argues that Hapag-Lloyd cannot
avail itself of COGSA’s statute of limitations because Hapag-Lloyd’s actions
amounted to an unreasonable deviation. (Pl.’s Br. in Opp’n to Mot. for Summ.
J., at 9-14). However, the Eleventh Circuit has stated that because “a deviation
in the delivery terms creates no greater risk that plaintiff will not be able to
file suit within the statutory period,” it “joins the Fifth Circuit in concluding
that an unreasonable course deviation does not nullify COGSA's one year
statute of limitation.” Mesocap Ind. Ltd. V. Torm Lines, 194 F.3d 1342, 1345
(11th Cir. 1999). That holding is binding on this Court, so Plaintiff’s argument
is without merit.
Next, the parties dispute what constitutes “delivery” under the terms of
COGSA. Neither the parties’ briefing nor the Court’s own research has
uncovered any rulings by the Eleventh Circuit discussing the meaning of
“delivery” under COGSA. See C.H. Robinson Worldwide, Inc. v. Compañia

Libre de Navegacion (Uruguay) S.A., 718 F. Supp. 2d 1361, 1363 (S.D. Fla.

it always has been) the 1936 enactment, which is recorded in the statutes at
large.” 1 Admiralty & Mar. Law § 10:16, n. 1 (6th ed.).
5

2010) (“There appears to be no binding precedent in this jurisdiction that
explains the meaning of the word ‘delivery’ as used in the COGSA statute.”).
Hapag-Lloyd advocates for following the Fifth Circuit’s approach which states
that “‘delivery’ occurs when the carrier places the cargo into the custody of
whomever

is

legally

entitled

to

receive

it

from

the

carrier.”

Servicios-Expoarma, C.A. v. Indus. Maritime Carriers, Inc., 135 F.3d 984, 992
(5th Cir. 1998). Meanwhile, Genuine Energy relies on contemporaneous
dictionaries and a case from the District of South Carolina to conclude that
“delivery” happens “when the consignee either actually or constructively
receives the goods.” (Pl.’s Br. in Opp’n to Mot. for Summ. J., at 15-17). Yet
another interpretation is expressed by the Southern District of New York in

Lithotip, CA. v. S.S. Guarico, 569 F. Supp. 837, 839 (S.D.N.Y. 1983): “We find
persuasive the opinions of the courts cited above that ‘delivery,’ both as the
term is used in everyday language, and as it appears to have been intended in
the context of the statute, requires, if not receipt by the deliveree, at least
notice to him and opportunity to accept delivery.” Regardless of which
interpretation is correct, summary judgment is not warranted at this time.
Under the Fifth Circuit test, the law and custom of the port of delivery
affects when “delivery” has occurred. Servicios-Expoarma, C.A., 135 F.3d at
993 (“This circuit has applied the custom of the port doctrine to determine who
is entitled to receive cargo from the carrier. . . . Thus, while contract and
6

maritime law generally will dictate into whose custody an ocean carrier is
required to deliver cargo, such law will be overridden by the established law or
custom of the port of delivery.”). Here, the custom and law of the port of
Qingdao has been contested. Genuine Energy has attached an announcement
purportedly from China’s Shandong province—where Qingdao is located—
stating that “[t]he shipping unit is responsible for organizing or entrusting a
disinfection unit to disinfect the transportation vehicles loaded with imported
container goods before and after shipment in the domestic transportation
section.” (Pl.’s Br. in Supp. of Mot. to Continue, Doc. 18-1, Ex. E (cited by Pl.’s
Statement of Additional Material Facts, Doc. 19-1, ¶ 7 on p. 6)). Because of
that, Genuine Energy argues that Hapag-Lloyd was still responsible—and
delivery did not occur—until the containers cleared customs. (Pl.’s Br. in Opp’n
to Mot. for Summ. J., at 17).
Hapag-Lloyd “objects to the introduction of alleged sources of Chinese
law with no support for those sources under Fed. R. Civ. P. 44.1.” (Def.’s Resp.
to Pl.’s Statement of Additional Material Facts, Doc. 23, ¶ 7). However, to the
extent that the announcement is not sufficiently supported, the reason for that
is the premature nature of Hapag-Lloyd’s Motion for Summary Judgment.
Hapag-Lloyd moved for summary judgment before the parties even made their
initial disclosures. While Hapag-Lloyd has now provided notice of its intent to
use the testimony of Chinese maritime lawyer Yu Changqing, that notice was
7

first provided on the same day Hapag-Lloyd submitted its Reply, two weeks
after Genuine Energy responded to the Motion for Summary Judgment. (Def.’s
Am. Notice, Doc. 25). The declaration was provided at that time either as an
attempt to surprise Genuine Energy or because that was the quickest
Hapag-Lloyd could get an expert declaration. Regardless of which is true, the
timing of the Yu Declaration emphasizes the need for further discovery. Thus,
under the Fifth Circuit’s standard, summary judgment is improper at this
time.
The same result holds under the other standards too. The parties
dispute when receipt or the opportunity to receive occurred. Because of its
understanding of Chinese customs law, Hapag-Lloyd contends that the
containers were released for pick up no later than October 27, 2022. (Def.’s Br.
in Supp. of Mot. for Summ. J., at 9; Id., Ex. 6, Doc. 16-6; Reply Br. in Supp. of
Mot. for Summ. J., at 8-10). Meanwhile, under its view that cargo is the
carrier’s responsibility until it clears customs (as opposed to when it is released
to customs), Genuine Energy asserts it did not have the opportunity to access
the soybeans until at least November 21, 2022. (Pl.’s Br. in Opp’n to Mot. for
Summ. J., at 17-18; Id., Ex. Q, Doc. 19-28). As already explained, more
discovery is needed in this case before the Court will adjudicate what the laws
and customs of the port of Qingdao were. Therefore, the Court cannot say that
Hapag-Lloyd has met its burden of proving the affirmative defense of statute
8

of limitations at this time. Hapag-Lloyd may renew its motion for summary
judgment on this ground at a later date.
B. Liability Limit
Hapag-Lloyd also moves for partial summary judgment, arguing that
damages for Plaintiff’s COGSA claim should be limited to $500 per package.
(Def.’s Br. in Supp. of Mot. for Summ. J., at 10-16). Since there were 26
containers of soybeans shipped, Hapag-Lloyd contends that its total liability
under COGSA cannot exceed $13,000. (Id.). 4 Genuine Energy asserts that
damages should not be limited to $13,000 both because Hapag-Lloyd engaged
in an unreasonable deviation and because the soybeans were not shipped in
packages. (Pl.’s Br. in Opp’n to Mot. for Summ. J., at 9-14, 20-23). The Court
concludes that partial summary judgment is premature at this time.
For goods shipped in packages, COGSA limits the carrier’s liability to a
maximum of $500 per package. 46 U.S.C. § 30701 (Note § 4(5)). By contrast,
“goods not shipped in packages” are limited to $500 “per customary freight
unit.” Id. However, “[t]he law in this circuit is that an unreasonable deviation
breaches the contract of carriage and renders COGSA's $500 per-package

Throughout the Reply brief, Hapag-Lloyd states that its liability
should not exceed $12,000. (Reply Br. in Supp. of Mot. for Summ. J., at 1, 3,
13, 15). However, Hapag-Lloyd states in its Statement of Undisputed Material
Facts—and Genuine Energy admits in its Response thereto—there were 26
containers. (Def.’s Statement of Undisputed Material Facts ¶ 1; Pl.’s Resp. to
Def.’s Statement of Undisputed Material Facts, ¶ 1). If each of those containers
are capped at $500, Hapag-Lloyd’s total liability could reach $13,000.
9
4

limitation a nullity, leaving the carrier liable as an insurer for the full amount
of damage to the cargo.” C.A. La Seguridad v. Delta S.S. Lines, 721 F.2d 322,
324 (11th Cir. 1983) (quotation marks, alterations, and citations omitted). A
reasonable deviation does not nullify the liability limit. See 46 U.S.C. § 30701
(Note § 4(4)).
Under Eleventh Circuit case law, there must be an “adequate
opportunity for discovery” before the court may grant summary judgment. See,

e.g., Smedley v. Deutsche Bank Tr. Co. Ams., 676 F. App’x 860, 862 (11th Cir.
2017); Fla. Power & Light Co. v. Allis Chalmers Corp., 893 F.2d 1313, 1316
(11th Cir. 1990). Here, no substantial discovery has taken place. (Joint Mot.
for Continuance and Am. Scheduling Order, Doc. 37, ¶¶ 4-5, 10-11). While
“summary judgment may be appropriate when no discovery has been held,”
these cases occur in a different procedural posture. Smedley, 676 F. App’x at
862 (discussing Reflectone, Inc. v. Farrand Optical Co., 862 F.2d 841, 843 (11th
Cir. 1989)). In Reflectone, Inc., 862 F.2d at 843, the plaintiff “chose to suspend
its discovery efforts pending the resolution of the motion for protective order.”
However, the district court granted the defendant’s motion for summary
judgment prior to ruling on the protective order. Id. As a result, the plaintiff
did not conduct any discovery. Id. The plaintiff appealed the grant of summary
judgment on the grounds that it did not have the opportunity to conduct any
discovery. Id. Interpreting Rule 56(d)’s predecessor, the Eleventh Circuit
10

affirmed the district court’s ruling because the plaintiff “did not even make any
motion to compel discovery” and “did not raise the issue anywhere in its papers
opposing summary judgment.” Id. at 844.
Here, by contrast, Genuine Energy made a Motion to Continue under
Rule 56(d), arguing that summary judgment is premature given that it has not
had the opportunity to conduct any meaningful discovery. It has also sought
discovery from Hapag-Lloyd. (Pl.’s First Set of Interrogs., Doc. 29-1; Pl.’s First
Set of Reqs. for Produc., Doc. 29-2). Because Hapag-Lloyd moved for summary
judgment prior to any meaningful discovery and because Genuine Energy has
raised the issue and sought discovery, the Court finds that the Motion for
Partial Summary Judgment is premature. Pursuant to Rule 56(d), the Court
will accordingly grant Genuine Energy’s Motion to Continue, and it will deny
Hapag-Lloyd’s Motion for Partial Summary Judgment without prejudice so
that it may raise the issue again once Genuine Energy has had an adequate
opportunity for discovery.
IV.

Conclusion

For the foregoing reasons, Hapag-Lloyd’s Motion for Summary
Judgment, or in the alternative, Motion for Partial Summary Judgment [Doc.
16] is DENIED without prejudice as premature, Genuine Energy’s Motion to
Continue [Doc. 18] is GRANTED, and Hapag-Lloyd’s Motion to Stay [Doc. 33]
is DENIED as moot.
11

SO ORDERED, this

26th

day of July, 2024.
______________________________
THOMAS W. THRASH, JR.
United States District Judge

12