Aurora Organic Dairy Corporation v. Western Dairy Transport, LLC
Filing
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ORDER denying 63 motion for summary judgment; denying 65 motion for summary judgment; granting in part and denying in part 67 motion to strike. Signed on 10/15/2013 by Magistrate Judge David P Rush. (Stone, Holly)
IN THE UNITED STATES DISTRICT COURT FOR THE
WESTERN DISTRICT OF MISSOURI
SOUTHERN DIVISION
AURORA ORGANIC DAIRY
CORPORATION,
Plaintiff,
v.
WESTERN DAIRY TRANSPORT, LLC,
Defendant.
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Case No. 11-3194-CV-S-DPR
MEMORANDUM AND OPINION
Now pending before the Court are 1) a Motion for Summary Judgment filed by
Defendant Western Dairy Transport, LLC (Doc. 63); 2) a Motion for Summary Judgment as to
Liability filed by Plaintiff Aurora Organic Dairy (Doc. 65); and 3) a Motion to Strike the
Statements, Opinions, Testimony, and Affidavits of Neil Bogart and Carolyn Otten filed by
Defendant Western Dairy Transport, LLC (Doc. 67). For the reasons set forth below, both
motions for summary judgment are DENIED, and the Motion to Strike Statements, Opinions,
Testimony, and Affidavits of Neil Bogart and Carolyn Otten is GRANTED in part and
DENIED in part.
FACTUAL BACKGROUND
As relevant here, Plaintiff Aurora Organic Dairy Corporation (“Aurora”) contracted with
Defendant Western Dairy Transport, LLC (“WDT”) to transport raw milk from various farms to
Aurora’s processing facility in Platteville, Colorado. Between May 18, 2010, and June 3, 2010,
WDT carried 28 tankers of milk from three Aurora farms: Coldwater East, Coldwater West, and
Pepper Dairies. Upon delivery at Aurora’s processing facility, the milk was deemed to be
contaminated with unidentified black particles.
ultimately destroyed.
The 28 loads were rejected; the milk was
Aurora brought this action seeking damages from WDT for the
contaminated milk.
MOTION TO STRIKE STATEMENTS, OPINIONS, TESTIMONY, AND AFFIDAVITS OF NEIL BOGART
AND CAROLYN OTTEN
Under Fed. R. Civ. P. 37(c)(1), a court may exclude information or opinions provided by
undisclosed witnesses as a sanction for failing to disclose them to the opposing parties. The
exclusion is “automatic and mandatory” unless the failure was “substantially justified or is
harmless.” Musser v. Gentiva Health Services, 356 F.3d 751, 758 (7th Cir. 2004). See also
Wegener v. Johnson, 527 F.3d 687, 692 (8th Cir. 2008). Pursuant to Fed. R. Civ. P. 26(a)(2), a
party is required to specifically disclose the identity of any witness “it may use at trial to present
evidence under Federal Rule of Evidence 702, 703, or 705.” Under Rule 702, a witness is
categorized as an expert based upon his or her reliance on “scientific, technical, or other
specialized knowledge.” Thus, a fact witness provides expert testimony if the testimony contains
opinions based on that scientific, technical, or specialized knowledge, “regardless of whether
those opinions were formed during the scope of interaction with a party prior to litigation.” OCI
Chem. Corp. v. Am. Railcar Indus., Inc., Case No. 4:05-cv-1506-FRB, 2009 WL 928730 (E.D.
Mo. March 31, 2009) (citing Musser, 356 F.3d at 757 n. 2).
Defendant WDT seeks to strike all statements, opinions, testimony, and affidavits of
Plaintiff Aurora’s witnesses Neil Bogart and Carolyn Otten. In brief, WDT alleges that the
statements and opinions expressed by Neil Bogart and Carolyn Otten and used in support of
Aurora’s Motion for Summary Judgment should be stricken because they were not properly
disclosed. Specifically, WDT alleges that in initial disclosures filed pursuant to Fed. R. Civ. P.
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26(a)(1), Aurora identified Neil Bogart as a fact witness only, and did not name or otherwise
designate Carolyn Otten at all. Aurora did not submit any supplemental disclosures. WDT
further alleges that Aurora did not disclose either Bogart or Otten as expert witnesses in its
expert disclosures pursuant to Fed. R. Civ. P. 26(a)(2). Aurora, however, provided declarations
of both Bogart and Otten in support of its motion for summary judgment. WDT requests that the
Court strike the statements and opinions of Bogart and Otten as a sanction for failure to disclose
them as experts, as specified in Fed. R. Civ. P. 37(c)(1).
Aurora responds that its failure to identify Carolyn Otten was inadvertent and ultimately
harmless because the reports she issued were fully disclosed to WDT, and WDT used them
extensively in deposing other witnesses, as did WDT’s expert Clifford Bigelow. Moreover,
Aurora contends that both Bogart and Otten are merely fact, not expert, witnesses, and therefore
specific expert disclosure under Rule 26(a)(2) was not required.
In reply, WDT contends that it intentionally forwent deposition of Neil Bogart because he
was not disclosed as an expert witness, and WDT presumed that Aurora would not offer Bogart’s
opinions. WDT argues that had it known Aurora intended to use Bogart as an expert, it would
have sought to depose him.
The Court has reviewed the declarations of Neil Bogart and Carolyn Otten and finds that
both expressed opinions based on their scientific, technical, and specialized expertise.
Accordingly, the Court finds that Aurora should have designated both Neil Bogart and Carolyn
Otten as experts and should have disclosed them accordingly. Aurora failed to disclose Carolyn
Otten as either a fact or expert witness, but subsequently relied on her declaration and scientific
reports in support of its motion for summary judgment. This was improper. Therefore, as a
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sanction for Aurora’s failure to so disclose, Otten’s declaration and reports are excluded from
use in support of the motion for summary judgment and may not be used at trial.
The Court recognizes that Bogart was a participant in the investigation of the
contaminated milk at the earliest stages, and therefore may have witnessed and participated in
events that are the basis of this lawsuit. Moreover, Aurora did disclose Bogart as a fact witness.
This disclosure is insufficient, however, to save his opinion testimony.
Thus, Bogart’s
statements describing what he observed or participated in may be used to support the motion for
summary judgment, and he may testify to those observations at trial.
His opinions and
recommendations made as a result of his investigation, however, are based upon scientific,
technical, or specialized expertise, and cross the boundary between fact and expert testimony.
As a result, the Court has disregarded his expert testimony in support of the motion for summary
judgment, and Bogart will be precluded from testifying as an expert at trial.
Accordingly, as described above, WDT’s Motion to Strike Statements, Opinions,
Testimony, and Affidavits of Neil Bogart and Carolyn Otten is GRANTED in part and
DENIED in part.
MOTIONS FOR SUMMARY JUDGMENT
Legal Standards
Under Federal Rule of Civil Procedure 56(c), summary judgment is proper only if the
moving party can demonstrate Athat there is no genuine issue as to any material fact and that the
moving party is entitled to judgment as a matter of law.@ Celotex Corp. v. Catrett, 477 U.S. 317,
322 (1986). See also Popp Telecom, Inc. v. Am. Sharecom, Inc., 361 F.3d 482, 487 (8th Cir.
2004). The moving party bears the burden of establishing that no material facts are in genuine
dispute; any doubt as to the existence of a genuine issue must be resolved against the moving
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party. Adickes v. S.H. Kress & Co., 398 U.S. 144, 160 (1970). See also Johnson v. Crooks, 326
F.3d 995, 1005-06 (8th Cir. 2003). A moving party is entitled to judgment as a matter of law
where the non-moving party “has failed to make a sufficient showing on an essential element of
her case with respect to which she has the burden of proof.” Celotex, 477 U.S. at 323. “[A]
complete failure of proof concerning an essential element of the nonmoving party’s case
necessarily renders all other facts immaterial.” Id.
The moving party bears the initial burden of demonstrating the absence of a genuine issue
of material fact. See Vaughn v. Roadway Express, Inc., 164 F.3d 1087, 1089 (8th Cir. 1998).
After the moving party has made that showing, the burden shifts to the non-moving party to
demonstrate the presence of a genuine issue for trial. See Beyer v. Firstar Bank, N.A., 447 F.3d
1106, 1108 (8th Cir. 2006). “Where the record taken as a whole could not lead a rational trier of
fact to find for the nonmoving party, there is no genuine issue for trial.” Ricci v. DeStefano, 557
U.S. 557, 586 (2009) (quoting Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574
(1986)).
Carmack Amendment
The Carmack Amendment to the Interstate Commerce Act holds a carrier of goods in
interstate commerce liable for loss, damage, or injury to property they transport. See Kaiser
Aluminum & Chem. Corp. v. Illinois Cent. Gulf R.R. Co., 615 F.2d 470, 474 (8th Cir. 1980)
(citing Missouri Pac. R.R. v. Elmore & Stahl, 377 U.S. 134 (1964)). To make out a prima facie
case under the Carmack Amendment, a shipper must show 1) the goods were delivered to the
carrier in good condition; 2) the goods arrived in damaged condition; and 3) the amount of
damages. See REI Trans., Inc. v. C.H. Robinson Worldwide, Inc., 519 F.3d 693, 699 (7th Cir.
2008).
If a shipper makes this showing, the carrier may avoid liability by demonstrating 1) it
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was not negligent, and 2) the cargo was damaged by other means. See Allied Tube & Conduit
Corp. v. S. Pac. Transp. Co., 211 F.3d 367, 370-71 (7th Cir. 2000).
A shipper may demonstrate delivery to the carrier in good condition through direct or
circumstantial evidence. Courts have held a clean bill of lading may sufficiently establish
delivery in good condition in situations where the carrier can visually inspect the goods for
damage. See Pillsbury Co. v. Illinois Cent. Gulf R.R., 687 F.2d 241, 244 (8th Cir. 1982). But in
cases where damage may not be immediately visible to the carrier, the shipper is required to
produce additional or “cumulative” evidence to establish delivery in good condition. See Nat’l
Trans., Inc. v. Inn Foods, Inc., 827 F.2d 351, 354 (8th Cir. 1987).
Cross Motions for Summary Judgment
In its own motion, and in response to WDT’s Motion for Summary Judgment, Aurora
argues that it has sufficiently made its prima facie case, and WDT cannot demonstrate it was not
negligent. Aurora points to the following evidence (Doc. 66) to demonstrate that the raw milk
was free from contaminants when it was loaded onto WDT’s tankers: 1) the damaged milk did
not come from a single source—it originated from three separate farms and six different milk
silos—but all of the damaged milk was transported on WDT tankers; 2) visual inspection of the
milk revealed no contamination; 3) bulk tank samples (samples taken of the raw milk from the
silo prior to transfer to a tanker) for all twenty-eight of the rejected loads were “clean” (not
contaminated); 4) no notes appeared on the bills of lading that would indicate debris or other
contaminants in each load; 5) beginning in July 2009 and into 2010, WDT tankers that arrived
for transport of Aurora milk were dirty, and “unsuitable” for transportation of the milk; and 6)
the contamination ceased when Aurora took over the process of washing the tankers in a “closedloop” system.
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Aurora contends that WDT cannot overcome the presumption of negligence in the face of
evidence that its tankers were frequently dirty, and it took no corrective action when informed of
the problems with tank washes and wash stations. Aurora further argues that WDT’s own expert
identified only three potential sources of contamination: the farm, the tankers shedding some
material, or a wash station introducing foreign material. Aurora contends that because it has
sufficiently demonstrated that the contamination could not have come from its farms, the only
potential explanations left are both the responsibility of WDT, thus making WDT liable. Thus,
Aurora contends, the only issue for trial is the amount of damages to which it is entitled.
In opposition to Aurora’s Motion for Summary Judgment, and in its own motion, WDT
argues that Aurora has not sufficiently made its prima facie case because Aurora did not
establish that the raw milk was delivered to the tankers in good condition.
WDT points
specifically to evidence from the testimony of Joe Drogowski, and the exhibit chart of Donna
Getman, that black specks appeared on several of the filters from farm milk silos. WDT further
contends that these filters, which might have shown farm-based contamination, were destroyed
without having been tested.
WDT further supports its argument with the testimony of its expert, Cliff Bigelow, who
opines that there is insufficient evidence to show that the tankers themselves or the tanker wash
process introduced the foreign matter into the raw milk.
Absent such evidence, Bigelow
concludes that the raw milk must have been contaminated prior to delivery to WDT’s tankers.
WDT contends alternatively that even if it is held liable, certain damages should be excluded
because Aurora failed to follow its own practices and procedures once it was determined that the
raw milk was delivered by WDT in damaged condition. Finally, WDT maintains that not all of
the samples taken of the raw milk before it was loaded onto the tankers were sent for testing, and
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the filters between the farm silos and the WDT tankers were destroyed. WDT thus argues that
Aurora’s claims should be dismissed as a remedy for spoliation of that evidence, or alternatively,
the jury should be given an adverse inference instruction.
Based upon the arguments of the parties and the evidence submitted in support of the
competing motions for summary judgment, the Court finds that genuine issues of material fact
exist as to whether Aurora has made its prima facie case under the Carmack Amendment.
Aurora has provided circumstantial evidence that the milk from the three farms was delivered to
WDT’s tankers in good condition, but WDT has provided testimonial evidence that “black
specks” appeared in milk before it was filtered into tankers, and expert testimony that the
contaminants did not come from WDT’s tankers.
In addition, WDT has raised questions
regarding the destruction of filters that might have provided relevant evidence regarding the predelivery condition of the milk. This evidence calls into question whether Aurora has sufficiently
established the first element of its prima face case; it raises a genuine issue of material fact for a
jury. As such, Aurora’s Motion for Summary Judgment is DENIED.
By the same token, however, Aurora has provided sufficient evidence of delivery of the
raw milk to the tankers in good condition. While WDT’s evidence calls into question Aurora’s
establishment of its prima facie case, it is not sufficient to entitle WDT to judgment as a matter
of law. Accordingly, WDT’s Motion for Summary Judgment is also DENIED.
Finally, regarding the issue of the destruction of the filters prior to testing, the Court will
consider WDT’s request for an adverse inference instruction at the upcoming Pretrial Conference
as it is the subject of one of WDT’s pending motions in limine.
CONCLUSION
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Therefore, based on all the foregoing, both Motions for Summary Judgment filed by
WDT (Doc. 63) and Aurora (Doc. 65) are DENIED. WDT’s Motion to Strike Statements,
Opinions, Testimony, and Affidavits of Neil Bogart and Carolyn Otten is GRANTED in part
and DENIED in part. At trial, Neil Bogart may testify as a fact witness, but not as an expert.
IT IS SO ORDERED.
DATED: October 15, 2013
/s/ David P. Rush
DAVID P. RUSH
United States Magistrate Judge
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