Woods Hole Oceanographic Institution v. ATS Specialized, Inc. et al

Filing 98

Judge Nathaniel M. Gorton: ORDER entered. ORDER ON REPORT AND RECOMMENDATIONS for 20 Motion to Dismiss for Failure to State a Claim filed by ATS Specialized, Inc., 22 Motion to Dismiss for Failure to State a Claim filed by Sam Broughton Wri ght, Jr., 32 Motion to Dismiss filed by Guy Tombs Limited, 27 Motion to Dismiss filed by Ridgeway International USA, Inc., 50 Motion to Dismiss/Lack of Jurisdiction filed by Australian National Maritime Museum. Action on motion: accepting and adopting in part and rejecting and modifying in part 91 Report and Recommendations. (Attachments: # 1 Report and Recommendations)(Lima, Christine)

Case 1:17-cv-12301-NMG Document 98 Filed 03/20/19 Page 1 of 7

United States District Court
District of Massachusetts
)
)
)
)
Plaintiff,
)
)
v.
)
)
ATS SPECIALIZED, INC., SAM
)
BROUGHTON WRIGHT, JR., RIDGEWAY )
INTERNATIONAL USA, INC., GUY
)
TOMBS LIMITED, AUSTRALIAN
)
NATIONAL MARITIME MUSEUM,
)
SERVICE TIRE TRUCK CENTER, INC. )
and TRAVELCENTERS OF AMERICA,
)
)
Defendants.
)
)
WOODS HOLE OCEANOGRAPHIC
INSTITUTION,

Civil Action No.
17-12301-NMG

MEMORANDUM & ORDER
GORTON, J.
Pending before the Court is the Report and Recommendation
(“R&R”) of Magistrate Judge Jennifer C. Boal which recommends
that: 1) the motion to dismiss of the Australian National
Maritime Museum (“the Museum”) be denied; 2) the motion to
dismiss of ATS Specialized, Inc. (“ATS”) be allowed, in part,
and denied, in part; 3) the motion to dismiss of Sam Broughton
Wright, Jr. (“Wright”) be allowed; 4) the motion to dismiss of
Ridgeway International USA, Inc. (“Ridgeway”) be allowed, in
part, and denied, in part; and 5) the motion to dismiss of Guy
Tombs Limited (“Guy Tombs”) be allowed.
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Specifically,

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Magistrate Judge Boal recommends the dismissal of Counts IV, VI,
VII, VIII, IX, X, XI, XIV and XV of the Complaint.
After careful consideration of the R&R and the several
objections thereto, the R&R will be accepted and adopted, in
part, and rejected and modified, in part.

The Court has

examined each of the issues addressed in the R&R and makes the
following rulings:
1. The Court will accept and adopt the recommendation of the
Magistrate Judge with respect to her determination that 1) the
Court has personal jurisdiction over Ridgeway and 2) Ridgeway
waived its defense that the Complaint should be dismissed for
failure to join indispensable parties.

Thus, Ridgeway’s

Objections to the R&R (Docket No. 92) will be overruled.
2. The Court will accept and adopt the recommendation of the
Magistrate Judge with respect to her determination that 1) the
loan agreement for the subject submarine involved commercial
activity and thus the Museum was not immune to suit under the
Foreign Sovereign Immunities Act, 28 U.S.C. § 1604 (“the
FSIA”) and 2) the Court has personal jurisdiction over the
Museum.

Thus, the Museum’s Objections to the R&R (Docket No.

93) will be overruled.

The Museum’s argument that it did not

purposefully avail itself of the forum and that it was not
reasonably foreseeable that it would be hailed into court in
Massachusetts because the parties had agreed to arbitrate any
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dispute in London is well taken.

The Museum provides no

caselaw, however, to support its contention that a valid
arbitration clause forecloses personal jurisdiction in any
forum other than the venue for prospective arbitration.

A

motion to compel arbitration or to dismiss for forum non
conveniens, rather than a motion to dismiss for lack of
personal jurisdiction, may have had more merit.

As to the

Museum’s contention that the Magistrate Judge erred in failing
to analyze whether the Museum’s contacts satisfied the
Massachusetts long-arm statute, M.G.L. c. 223A, § 3(a), the
Court finds that, although the Magistrate Judge did not
explicitly address that statute, she did explain that the
requirement of “transacting any business” under Section 3(a)
of the Massachusetts long-arm statute is regularly construed
broadly in favor of the party alleging personal jurisdiction.
Here the Court finds that the loan agreement between the
Museum and Woods Hole Oceanographic Institution (“WHOI” or
“plaintiff”), even if related to a nonprofit purpose, is a
business transaction within the purview of the long-arm
statute for the same reasons the conduct was determined to be
commercial under the FSIA.
3. The Court will accept and adopt the Magistrate Judge’s finding
that WHOI is entitled, at this stage of the litigation, to
plead its state law claims against ATS in the alternative and
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thus ATS’s Objections to the R&R (Docket No. 95) will be
overruled.

The Court must decide ATS’s motion to dismiss

based on the allegations contained in the complaint, not based
on other claims that could have been brought by WHOI but were
not. See Nollet v. Justices of Trial Court of Mass., 83 F.
Supp. 2d 204, 208 (D. Mass. 2000), aff’d, 248 F.3d 1127 (1st
Cir. 2000).

Because WHOI contests the applicability of the

Carriage of Goods By Sea Act (“COGSA”), 46 U.S.C. § 30701, et
seq., as a factual matter, the Court construes the allegations
in the Complaint only with respect to the Carmack Amendment
claim, 49 U.S.C. § 14706, and the state law claims.
Magistrate Judge Boal is correct that, at the pleading stage,
WHOI is entitled to plead those claims in the alternative even
if it is ultimately determined that the Carmack Amendment
preempts the state law claims. Lass v. Bank of Am., N.A., 695
F.3d 129, 140 (1st Cir. 2012); see also Fed. R. Civ. P. 8(d).
ATS may be able to demonstrate at the summary judgment stage
that it is COGSA, not the Carmack Amendment, that applies and
that COGSA preempts plaintiff’s state law claims based upon
facts established in the meantime.
4. The Court will sustain WHOI’s Objections to the R&R (Docket
No. 94), insofar as the Magistrate Judge recommends that: 1)
Count IV of the Complaint for unfair and deceptive practices
against ATS be dismissed as preempted by the Interstate
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Commerce Commission Termination Act/Federal Aviation
Administration Authorization Act (the “ICCTA/FAAAA”), 49
U.S.C. § 14501(c)(1) and 2) Counts VI and VII of the Complaint
for breach of bailment and negligence against Ridgeway be
dismissed for failure to state a claim.

Specifically, the

Court finds that WHOI did address, in its opposition to ATS’s
motion to dismiss, the argument that the unfair and deceptive
practices claim is preempted by the ICCTA/FAAAA, albeit in
only one sentence in a footnote.

Nor does the ICCTA/FAAAA

preempt unfair business practices claims for posttransportation conduct. Dan’s City Used Cars, Inc. v. Pelkey,
569 U.S. 251, 261-63 (2013).

For the reasons already

explained, the Court declines to decide at this stage whether
the Carmack Amendment preempts the claim for unfair and
deceptive practices against ATS.

Furthermore, the Court finds

that WHOI has alleged sufficient facts to state a plausible
claim for breach of bailment obligations and negligence as to
Ridgeway on the basis of its purported agency relationship
with ATS.

WHOI has stated a claim that 1) ATS was acting as

the agent of Ridgeway at the time that the submarine was
damaged and 2) Ridgeway, as the principal, may be held liable
for ATS’s purported breach of bailment and negligence.

On the

other hand, the Court will overrule WHOI’s objections to the
R&R insofar as the Magistrate Judge recommends that the Court
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find that the acts of Ridgeway may not be imputed to Guy Tombs
for the purposes of determining personal jurisdiction over Guy
Tombs.

While the actions of an agent can be attributed to the

principal for the purposes of establishing personal
jurisdiction over the principal, the opposite inference that
actions of a principal can subject its agent to personal
jurisdiction does not follow. See Daynard v. Ness, Motley,
Loadholt, Richardson & Poole, P.A., 290 F.3d 42, 55 (1st Cir.
2002).

The actions of Ridgeway cannot subject its agent, Guy

Tombs, to the jurisdiction of this Court.

The Court also

agrees with the Magistrate Judge that Guy Tombs had
insufficient contacts with the Commonwealth of Massachusetts
in arranging for the cargo insurance policy and thus the Court
may not exercise personal jurisdiction over it.
ORDER
For the foregoing reasons, the R&R of Magistrate Judge Boal
(Docket No. 91) is
1) with respect to the recommendation to dismiss all of the
claims against Guy Tombs and Wright (Counts VIII, IX, X,
XI, XIV and XV), ACCEPTED and ADOPTED; but
2) with respect to the recommendation to dismiss the claim
for unfair and deceptive practices against ATS (Count IV)
and to dismiss the claims for breach of bailment

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obligations and negligence against Ridgeway (Counts VI
and VII), REJECTED and MODIFIED.

So ordered.
/s/ Nathaniel M. Gorton______
Nathaniel M. Gorton
United States District Judge
Dated March 20, 2019

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