CSX Transportation, Inc. v. Alban Waste, LLC et al

Filing 82

MEMORANDUM. Signed by Judge James K. Bredar on 4/2/14. (jnls, Deputy Clerk)

IN THE UNITED STATES DISTRICT COURT
FOR THE DISTRICT OF MARYLAND
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CSX TRANSPORTATION, INC.,

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Plaintiff

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v.

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ALBAN WASTE, LLC, et al.,
Defendants
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CIVIL NO. JKB-13-1770

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HARFORD MUT. INS. CO.,

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Plaintiff

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v.

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CSX TRANSPORTATION, INC., et al.,
Defendants
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CIVIL NO. JKB-14-137

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MEMORANDUM
Pending before the Court are motions to consolidate these two cases and to stay Civil
Action Number JKB-13-1770. (13-1770, ECF Nos. 37, 42, 62; 14-137, ECF Nos. 6, 9, 10.) In
13-1770, ECF No. 37 is moot because it sought a stay pending disposition of Civil Action
Number JKB-14-406 and the latter case has been dismissed. The other motions have been
briefed (ECF Nos. 50, 56, 71, 73), and no hearing is required, Local Rule 105.6 (D. Md. 2011).
They will be denied.

I. Background
In 13-1770, CSX Transportation, Inc. (“CSXT”), sued Alban Waste, LLC, and John
Jacob Alban, Jr. (the “Albans”) for damages flowing from a collision on May 28, 2013, in
Baltimore County, Maryland, between a train owned by CSXT and a truck owned by Alban
Waste and operated by John Alban. (13-1770, Compl. ¶¶ 2, 3, 4, ECF No. 1.) The collision
resulted in the derailment of multiple train cars, which ignited the cargo and caused an explosion.
(Id. ¶ 5.) CSXT alleges the cause of the collision was negligence by the Albans. This suit was
filed June 18, 2013.

After the Albans answered, a scheduling order was entered and the

extended discovery deadline in that case is now April 29, 2014. (Id. ECF Nos. 13, 63.)
In 14-137, a statutory interpleader action that was filed on January 16, 2014, Harford
Mutual Insurance Company (“Harford”) alleges it has received claims or knows of potential
claims against its insureds, the Albans, totaling approximately $10 million in damages. (14-137,
Compl. ¶ 44, ECF No. 1.) The commercial automobile insurance policy issued by Harford to the
Albans has a $1 million limit for liability claims. (Id. ¶ 45.) After depositing funds in this
amount with the Court (14-137, Dkt. Ent. Mar. 11, 2014), Harford seeks to be discharged from
the case and to have the defendants in 14-137 litigate among themselves their respective claims
to the policy’s proceeds and for the Court to direct the proper distribution thereof. (14-137,
Compl. Prayer ¶¶ 1, 3.) Harford also asks the Court to enter an order restraining the defendants
named in the interpleader complaint from instituting or further prosecuting any other proceeding
affecting the rights and obligations between and among them until further order of the Court.
(Id. ¶ 2.) The defendants are CSXT and 42 individuals and businesses, or their subrogee
insurance companies. Named as “Defendants/Interested Parties” are Alban Waste, LLC, and

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John Jacob Alban, Jr. As of April 1, 2014, seven defendants have filed answers, and an
additional three have been served.1
II. Applicable Standards
A. Standard for Consolidation
Federal Rule of Civil Procedure 42(a) permits, but does not mandate, consolidation of
cases that involve a common question of law or fact.

The Supreme Court has stated,

“[C]onsolidation is permitted as a matter of convenience and economy in administration, but
does not merge the suits into a single cause, or change the rights of the parties, or make those
who are parties in one suit parties in another.” Johnson v. Manhattan Ry. Co., 289 U.S. 479,
496-97 (1933); Intown Props. Mgmt., Inc. v. Wheaton Van Lines, Inc., 271 F.3d 164, 168 (4th
Cir. 2001). If a common question of law or fact exists, then the district court must weigh the
competing considerations to determine if consolidation is desirable.
The critical question for the district court in the final analysis was whether the
specific risks of prejudice and possible confusion were overborne by the risk of
inconsistent adjudications of common factual and legal issues, the burden on
parties, witnesses and available judicial resources posed by multiple lawsuits, the
length of time required to conclude multiple suits as against a single one, and the
relative expense to all concerned of the single-trial, multiple-trial alternatives.
See Fed. R. Civ. P. 42(a); see generally 9 C. Wright & A. Miller, Federal Practice
& Procedure: Civil s 2383 (1971).
Arnold v. Eastern Air Lines, Inc., 681 F.2d 186, 193 (4th Cir. 1982). If the common issue is not
central to the resolution of the cases or if consolidation will lead to delay in the processing of one
of the individual cases, then consolidation may be denied. 9A C. Wright & A. Miller, Federal
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Service was also made on the subrogee insurer of named defendant Timothy Koerber, but the subrogee
insurer was not named separately in the complaint. Timothy Koerber has filed his own suit alleging negligence by
the Albans.
Cir. Ct. Baltimore County, No. 03-C-13-011031 MT, filed September 27, 2013,
http://casesearch.courts.state.md.us/inquiry/inquiryDetail.jis?caseId=03C13011031&loc=55&detailLoc=CC.
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scheduling order was entered in that case on December 23, 2013, and the parties have spent several months in
discovery, which does not appear from the case docket to be concluded. Id. CSXT and Steven B. Tucker have been
impleaded in that case as third-party defendants by the Albans. Id.

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Practice & Procedure: Civil § 2383, at 40-43 (3d ed. 2008). The decision lies within the
discretion of the district court.
B. Standard for Stay
Whether to stay a case is a decision made in the exercise of discretion by the district court
as part of its inherent power to control its own docket. Landis v. North American Co., 299 U.S.
248, 254 (1936). Economy of time and effort for the court, counsel, and litigants is taken into
consideration in this decision, “which must weigh competing interests and maintain an even
balance.” Id. at 254-55. A party seeking a stay must demonstrate a pressing need for one, id. at
255, and that the need for a stay outweighs any possible harm to the nonmovant. Mike’s Train
House v. Broadway Ltd., Civ. No. JKB-09-2657, 2011 WL 836673, at *1 (D. Md. Mar. 3, 2011).
See also In re Sacramento Mun. Utility Dist., 395 F. App’x 684, 687-88 (Fed. Cir 2010)
(unpublished). Three factors should be considered in weighing a motion to stay: “(1) the
interests of judicial economy; (2) hardship and equity to the moving party if the action is not
stayed; and (3) potential prejudice to the non-moving party.” Davis v. Biomet Orthopedics, LLC¸
Civ. No. JKB-12-3738, 2013 WL 682906 (D. Md. Feb. 22, 2013) (citations and internal
quotation marks omitted).
III. Analysis
The Albans and Harford have failed to present a compelling, or even desirable, case for
consolidation of 13-1770 with 14-137. It is at least arguable that the two cases present a
common issue, namely, whether the Albans are liable to CSXT. However, the interpleader suit
involves 42 other claimants, who are not similarly situated to CSXT. The railroad company
suffered direct property damage, as presumably did the other claimants, but the nature of
CSXT’s claimed damages are considerably more comprehensive—including environmental
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clean-up, train delays, labor, and damage or destruction to freight (13-1770 Compl. ¶ 22)—than
that suffered by nearby property or business owners. Moreover, the two cases are at very
different points in their progress. CSXT’s suit is close to the end of discovery and will soon be
ready for the filing of dispositive motions whereas the interpleader suit has not yet been served
on most of the claimants. Once all have been served in 14-137, only then would a scheduling
order be entered and discovery be undertaken.

Discovery in the interpleader case will

necessarily address the propriety of the claims made by the 42 claimants, and that process has
nothing at all to do with CSXT’s case against the Albans. It would be unjust to CSXT to
consolidate its suit with the interpleader suit since they are on completely different schedules.
The Court concludes that consolidation is undesirable. Moreover, the request to consolidate
13-1770 and 14-137 and then stay 13-1770 makes no sense.

If an important purpose of

consolidation is judicial economy because two cases are proceeding as one, then staying one of
the two cases is antithetical to judicial economy. In the present circumstances, greater judicial
economy is achieved by proceeding to a resolution of CSXT v. Alban Waste and incorporating
whatever determination is made there into the determination in 14-137 of whether CSXT is
entitled to share in the liability policy proceeds.
As for the motion to stay, initially, the Court is puzzled as to why Harford filed such a
motion in 13-1770 since it is not a party and has not moved to intervene. In short, Harford has
no standing to file a motion in 13-1770, and its filing will be stricken. However, since Harford
filed an identical motion in 14-137, the Court will address it. Nevertheless, Harford has argued
unpersuasively that the 42 claimants other than CSXT “will be left without a voice in the
outcome of the CSX Suit . . . in which [the 42 claimants] clearly hold an interest.” (14-137, Pl.’s
Mot. Stay Supp. Mem. 6, ECF No. 6.) Harford has failed to explain why anyone other than
CSXT and the Albans is entitled to a voice in the outcome of the CSXT v. Alban Waste suit.
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Harford’s additional argument that staying 13-1770 will prevent a multiplicity of suits (id.) is
equally untenable. Staying one suit cannot prevent others from filing their own suits.
Finally, the Court notes that Harford’s motion to stay 13-1770 is wrongly premised upon
the notion that an interpleader plaintiff is entitled to a global stay of other lawsuits. The statute
relating to this issue specifies,
In any civil action of interpleader or in the nature of interpleader under
section 1335 of this title, a district court may issue its process for all claimants
and enter its order restraining them from instituting or prosecuting any proceeding
in any State or United States court affecting the property, instrument or obligation
involved in the interpleader action until further order of the court.
28 U.S.C. § 2361 (emphasis added). The Supreme Court addressed this very issue in State Farm
Fire & Cas. Co. v. Tashire, 386 U.S. 523 (1967), and held that a district court was without
authority to enjoin other proceedings that do not seek a share of the property or fund at issue in
the interpleader suit. Id. at 535-37. Further, the Court dispensed with the idea that the logical
plaintiffs in the mass tort in Tashire should be required to press their claims only in the
interpleader suit, saying,
The circumstance that one of the prospective defendants happens to have an
insurance policy is a fortuitous event which should not of itself shape the nature
of the ensuing litigation. . . . And an insurance company whose maximum interest
in the case cannot exceed [the policy’s limit for liability] and who in fact asserts
that it has no interest at all, should not be allowed to determine that dozens of tort
plaintiffs must be compelled to press their claims—even those claims which are
not against the insured and which in no event could be satisfied out of the meager
insurance fund—in a single forum of the insurance company’s choosing. There is
nothing in the statutory scheme, and very little in the judicial and academic
commentary upon that scheme, which requires that the tail be allowed to wag the
dog in this fashion.
Id. at 534-35.
Here, Harford overlooks the limiting language of § 2361 and asks to have all suits
between and among the claimants enjoined, whether or not such other suits seek a share of the
$1 million policy proceeds. The statute, as written and as interpreted by the Tashire case, does
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not support such a request. Finally, the Court questions why Harford included the insureds as
claimants against the liability portion of the insurance policy. It is implausible that the Albans
would be making a claim against themselves. See Allstate Ins. Co. v. McNeill, 382 F.2d 84, 86
(4th Cir. 1967) (insured’s estate was not an “adverse claimant” under 28 U.S.C. § 1335 in
interpleader action focused on insured’s automobile liability policy). The policy includes a
separate limit for the insureds to make a claim for property damage and a separate limit for
personal injury protection for an individual insured. (Policy, ECF No. 1-1 at p. 52.) It is
possible that Harford included the Albans in the interpleader suit to further support its request for
the Court to enjoin other cases not only against Harford but also against the alleged tortfeasors.
But this, too, is equally improper. Tashire, 386 U.S. at 533 (“The fact that State Farm had
properly invoked the interpleader jurisdiction under § 1335 did not, however, entitle it to an
order both enjoining prosecution of suits against it outside the confines of the interpleader
proceeding and also extending such protection to its insured, the alleged tortfeasor.”). A stay of
13-1770 is unwarranted.
IV. Conclusion
The motions to consolidate and/or to stay are inconsistent with judicial economy and the
rights of the parties. A separate order will issue.
DATED this 2nd day of April, 2014.

BY THE COURT:

/s/
James K. Bredar
United States District Judge

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