Starr Indemnity & Liability Co. v. Luckey Logistics, Inc. et al
ORDER & OPINION entered by Judge Joe Billy McDade on 6/6/2017. IT IS THEREFORE ORDERED: Defendant Affton Trucking Company's Motion to Dismiss or Transfer (Doc. 20 ) is granted. This case is TRANSFERRED to the District of Nebraska. The Clerk is directed to transfer the case. Defendant's Motion to Dismiss (Doc. 15 ) andDefendant's Motion for Leave to File a Reply (Doc. 22 ) are DENIED AS MOOT. SEE FULL WRITTEN ORDER & OPINION. (SL, ilcd)[Transferred from Illinois Central on 6/7/2017.]
Wednesday, 07 June, 2017 04:18:27 PM
Clerk, U.S. District Court, ILCD
UNITED STATES DISTRICT COURT
CENTRAL DISTRICT OF ILLINOIS
STARR INDEMNITY & LIABILITY CO.,
as subrogee of CHANNEL PRIME
ALLIANCE, a division of RAVAGO
HOLDINGS AMERICA, INC.,
LUCKEY LOGISTICS, INC.
AFFTON TRUCKING COMPANY, INC. )
Case No. 1:16-cv-01377-JBM-JEH
ORDER & OPINION
The matter is before the Court on Defendant Affton Trucking Company’s
Motion to Dismiss for Improper Venue Pursuant to Federal Rule of Civil Procedure
12(b)(3). (Doc. 20). For the reasons explained below, the Motion is granted and the
case is transferred to the District of Nebraska.
Plaintiff2 entered into an agreement with Defendants to transfer four different
loads of polypropylene resin between December 19, 2014 and January 29, 2015. (Doc.
The Court notes that Plaintiff’s Motion to File an Amended Complaint (Doc. 17)
states that “the correct identity of that Defendant is ‘Luckey Transfer, LLC.’” (Doc.
17 at 1).
Starr Indemnity is the insurer of Ravago and Channel Prime Alliance (“CPA”). CPA
is a division of Ravago and both CPA and Ravago sell polymer resin and distribution.
Starr satisfied the insurance claim made by CPA and Ravago and now seeks to inforce
its subrogation rights against the parties responsible for the aforesaid loss. (Doc. 19
19 at 2). Defendant Affton transported the first shipment from Kansas City, Kansas
to Broken Bow, Nebraska. (Doc. 19 at 3). Defendant Luckey transported the second,
third, and fourth loads from Des Moines, Iowa to Broken Bow, Nebraska. (Doc. 19 at
3). A bill of lading was generated by the respective transporting Defendant for each
of the four deliveries. (Doc. 19 at 3). The cargo was accepted with no exceptions noted
and the polypropylene resin from all four loads was placed in one silo in Broken Bow,
Nebraska. (Doc. 19 at 3-4). One, or possibly more, of the trucks used to carry the
polypropylene had previously carried polyethylene. (Doc. 19 at 4). The polyethylene
contaminated the polypropylene in the truck and then when the four trucks’ loads
were placed in the silo, all of the polypropylene in the silo became contaminated. (Doc.
19 at 4). This was not discovered until the Broken Bow facility attempted to use the
polypropylene and experienced difficulties. (Doc. 19 at 4).
On October 4, 2016, Plaintiff filed a Complaint in this Court against
Defendants seeking recovery under the Carmack Amendment, 41 U.S.C. § 14706.
(Doc. 1). On February 17, 2017, Defendant Affton filed a Motion to Dismiss or
Transfer Venue. (Doc. 15). On March 3, 2017, Plaintiff sought leave to file an
Amended Complaint, which was granted and Plaintiff filed an Amended Complaint.
(Doc. 17). On March 8, 2017, Defendant Affton filed a Motion to Dismiss for Improper
Venue pursuant to Federal Rule of Civil Procedure 12(b)(3). (Doc. 20).3
After Defendant Affton filed its second Motion to Dismiss for Improper Venue,
Plaintiff accused Defendant Affton of trying to “take a second bite at the apple” and
“back-handedly attempting to file a sur-reply.” The Court would like to direct Plaintiff
to Local Rule 7.1(E), which states:
“Whenever an amended pleading is filed, any motion attacking the
original pleading will be deemed moot unless specifically revived by the
moving party within 14 days after the amended pleading is served.”
II. LEGAL STANDARDS
On a motion to dismiss for improper venue under Federal Rule of Civil
Procedure 12(b)(3), the burden lies with the plaintiff to show that the venue is proper.
Emjayco ex rel. Troy v. Morgan Stanley, 901 F. Supp. 1397, 1400 (C.D. Ill. 1995)
(citations omitted). The plaintiff must show that venue is proper as to all defendants
and all claims. Id. (citations omitted). The allegations in a plaintiff’s complaint are
to be taken as true, unless controverted by the defendant’s affidavits; and any conflict
is to be resolved in the plaintiff’s favor. Id. (citing Turnock v. Cope, 816 F.2d 332, 333
(7th Cir. 1987). To survive a motion to dismiss for improper venue, a plaintiff must
allege or establish facts to support venue in its chosen district. Id. The Court “may
examine facts outside the complaint in order to determine whether venue is proper.”
Faur v. Sirius Int’l Ins. Corp., 391 F. Supp. 2d 650, 657 (N.D. Ill. 2005).
Plaintiff has failed to allege enough facts to support that the Central District
of Illinois is a proper venue for Defendant Affton. Therefore, the best remedy is to
transfer the case to the District of Nebraska, which is a proper venue for both
Defendants. To come to this conclusion, the Court first examines the Carmack
Amendment’s special venue provision to determine if it provides proper venue over
Defendant Affton. Because it does not, the Court then examines whether the
Carmack Amendment’s special venue provision is restrictive or permissive. Because
the Court determines that Carmack Amendment’s special venue provision is
Therefore, Defendant Affton was required to renew its motion to dismiss or the Court
would find it moot. The Court would like to advise Plaintiff to consult the Local Rules
before filing material with the Court.
permissive, the Court then examines the general venue statute to determine if it
provides proper venue over Defendant Affton. After determining that the Central
District of Illinois is not a proper venue, the Court examines the availability remedies
and whether there is a district that would be proper for both defendants.
A. CARMACK AMENDMENT SPECIAL VENUE PROVISION AND DISCUSSION
Plaintiff has failed to establish proper venue for Defendant Affton under the
Carmack Amendment. The Carmack Amendment contains a special venue provision.
“(d) Civil actions.
(1) Against delivering carrier. A civil action under this section may
be brought against a delivering carrier in a district court of the
United States or in a State court. Trial, if the action is brought in a
district court of the United States is in a judicial district, and if in a
State court, is in a State through which the defendant carrier
(2) Against carrier responsible for loss. A civil action under this
section may be brought against the carrier alleged to have caused
the loss or damage, in the judicial district in which such loss or
damage is alleged to have occurred.”
49 U.S.C. § 14706 (2016) (emphasis added). Therefore, venue may be found against a
“delivering carrier” or a “carrier responsible for the loss.” Plaintiff has not alleged
enough facts to satisfy either subsection.
Plaintiff’s statement on the Court’s jurisdiction over Defendant Affton simply
“Upon information and belief, AFFTON TRUCKING COMPANY, INC.
(“Affton”) is a transportation company headquartered in St. Louis,
Missouri and regularly conducts business in Illinois, such that the
exercise of this Court’s jurisdiction over it would not offend the
traditional notions of fair play and substantial justice.”
(Doc. 19 at 2).
As to Defendant Affton, venue would be proper as a delivering carrier if the
action is brought in a federal judicial district through which Defendant Affton
operates. 49 U.S.C. § 14706(d)(1). However, Plaintiff has not alleged that Defendant
Affton operates in the Central District of Illinois. Plaintiff has merely alleged that
Defendant Affton operates in the states of Illinois, which is insufficient to establish
proper venue. See, e.g., Cargo-Master, Inc. v. Coast Midwest Transp., No. 3:97-CV1637-G, 1998 U.S. Dist. LEXIS 12707, at *4 (N.D. Tex. 1998) (“An allegation that
defendant operates within the state says nothing about its operations within this
district. . . ”); Ponce De Leon Hosp. Corp. v. Avalon Logistics, Inc., 117 F. Supp. 3d
124, 130 (D.P.R. 2015) (finding proper venue under § 14706(d)(1) because it was well
established that the defendants operated routes which “actually transports property”
through the District of Puerto Rico).
Venue would be proper for the carrier responsible for the loss if the action is
brought in the judicial district in which such loss or damage has occurred. 49 U.S.C.
§ 14706(d)(2). However, Affton shipped one truckload of polypropylene resin from
Kansas City, Kansas to Broken Bow, Nebraska. Therefore, the alleged damage did
not take place in the Central District of Illinois. Because of this, Plaintiff has not
alleged sufficient facts to show that the Central District of Illinois is a proper venue
for Defendant Affton under either of the Carmack Amendment’s special venue
B. CARMACK AMENDMENT’S SPECIAL VENUE PROVISION IS PERMISSIVE
Although Plaintiff was unable to establish proper venue under the Carmack
Amendment’s special venue provision, Plaintiff may still establish proper venue
under the general venue statute, if the Carmack Amendment’s special venue
provision is permissive and not restrictive. Congress has established both “general
venue” statutes, e.g. 28 U.S.C. § 1391, and “special venue” statutes, which explicitly
cover venue for a particular type of action, e.g. 49 U.S.C. § 14706(d). When the special
venue provisions are permissive, they may be supplemented by the more expansive
provisions of the general venue statutes. See Pure Oil Co. v. Suarez, 384 U.S. 202,
207 (1966). “Situations in which courts find that Congress intended to restrict venue
under a special provision so as to preclude the application of the general venue statute
are rare.” Halliburton Energy Servs., Inc. v. NL Indus., No. H-05-4160, 2006 U.S.
Dist. LEXIS 50853, at *22 (S.D. Tex. July 25, 2006). Therefore, the Court must
determine whether the special venue statute is permissive or restrictive in nature.
When a special venue statute is restrictive, the action may only be brought in
a district permitted by the special venue statute. Pacer Global Logistic, Inc. v.
AMTRAK, 272 F. Supp. 2d 784, 790 (E.D. Wis. 2003). The analysis of a special venue
provision must be specific to that particular statute, because Congress has intended
some cases, but not all, to be restrictive. Cortez Byrd Chips, Inc. v. Bill Harbert
Constr. Co., 529 U.S. 193, 204 (2000).
Based on the language of the text, the Court finds that the Carmack’s special
venue provision is permissive. The Court notes that the language of the provision is
“may,” which is a permissive term. It does not use restrictive terms like “shall” or
“only,” which would indicate restriction or exclusivity. See, e.g., Landstar Ranger, Inc.
v. Global Experience Specialists, Inc., No. 5:14-cv-193-RLV-DCK, 2016 U.S. Dist.
LEXIS 87434, at *6 (W.D.N.C. July 6, 2016) (finding the Carmack Amendment’s
special venue provision to be permissive because “the statute uses the singular and
discretionary term ‘may,’ rather than ‘shall’ or ‘must,’ or even ‘may’ modified by the
limiting ‘only.’”) (citations omitted).
If Congress wished to restrict venue to the special provision, it could have done
so and has done so in other portions of the Carmack Amendment. In a separate
provision of the Carmack Amendment, pertaining to rail carriers, the special venue
provision states that “a civil action under this section may only be brought. . . .” 49
U.S.C. § 11706. Before 1980, plaintiffs were able to bring their Carmack claims
against rail carriers in any judicial district where the carrier operated. Sompo Japan
Ins. Co. of Am. v. Yang Ming Marine Transp. Corp., 578 F. Supp. 2d 584, 595
(S.D.N.Y. 2008), abrogated on other grounds by Sompo Japan Ins. Co. of Am. v. Yang
Ming Marine Transp. Corp., 578 F. Supp. 2d 584 (S.D.N.Y. 2008) (“Sompo II”). In
1980, Congress amended the railway special provision because it was “virtually
uncontrollable and frequently inconvenient.” Id. (citing H.R. Rep. No. 96-1430, at 102
(1980), reprinted in 1980 U.S.C.C.A.N. 4410). As a result, Congress changed the
language of § 11706(d)(2)(A) to state “a civil action under this section may only be
brought.” Therefore, it is evident that Congress intended to restrict Carmack
Amendment claims against railways to the venues designated in its specific venue
provision. See id. (collecting cases finding the § 11706 special venue provision to be a
However, Congress has not amended the § 14706 provision to include any
similarly restrictive language. Therefore, the Court finds that Congress has not
intended for § 14706 to be a restrictive special venue provision. Because § 14706 is a
permissive special venue statute, Plaintiff may establish proper venue under either
it or the general venue provision of 28 U.S.C. § 1391.
C. GENERAL VENUE PROVISION AND DISCUSSION
Therefore, Plaintiff may establish proper venue for Defendant Affton under the
general venue provision; however Plaintiff has failed to do so. The general venue
“(b) Venue in general. A civil action may be brought in –
(1) a judicial district in which any defendant resides, if all defendants
are residents of the State in which the district is located;
(2) a judicial district in which a substantial part of the events or
omissions giving rise to the claim occurred, or a substantial part of
property that is the subject of the action is situated; or
(3) if there is no district in which an action may otherwise be brought
as provided in this section, any judicial district in which any
defendant is subject to the court’s personal jurisdiction with respect
to such action.”
28 U.S.C. § 1391. The general venue statutes defines “residency” as
“For purposes of venue under this chapter, in a State which has more
than one judicial district and in which a defendant that is a corporation
is subject to personal jurisdiction at the time an action is commenced,
such corporation shall be deemed to reside in any district in that State
within which its contacts would be sufficient to subject it to personal
jurisdiction if that district were a separate State. . . .”
28 U.S.C. § 1391(d). Because Illinois has three federal judicial districts, a corporation
must have contacts with the Central District of Illinois sufficient to subject it to
personal jurisdiction if it were its own state in order for venue to be proper.
Venue would be proper in a judicial district in which a substantial part of the
events took place. 28 U.S.C. § 1391(b)(2). However, for Defendant Affton’s delivery,
that would be in either the District of Kansas or the District of Nebraska, not the
Central District of Illinois. Therefore, venue is not proper under § 1391(b)(2). See, e.g.,
Hoeller v. Barrington, 619 F. App’x 534, 535 (7th Cir. 2015) (affirming a dismissal for
improper venue from the Eastern District of Wisconsin because all of the harm
occurred in the Northern District of Illinois, therefore venue could not be proper
under § 1391(b)(2)); Green v. Beth, No. 15-cv-540-bbc, 2017 U.S. Dist. LEXIS 13693,
at *2 (W.D. Wis. Feb. 1, 2017) (transferring a case from the Western District of
Wisconsin to the Eastern District of Wisconsin because none of the events occurred
in the Western District of Wisconsin); Howard v. Rodgers, No. 16-cv-158-jdp, 2017
U.S. Dist. LEXIS 11591, at *4-5 (W.D. Wis. Jan. 26, 2017) (transferring a case from
the Western District of Wisconsin to the District of Kansas because none of the events
occurred in the Western District of Wisconsin). Additionally, because venue may be
brought in the Districts of Kansas or Nebraska, there is a judicial district where the
action may otherwise be brought; therefore, venue cannot be proper in the Central
District of Illinois under § 1391(b)(3). See, e.g., Taylor v. Armstrong, 38 F. App’x 337,
339 (7th Cir. 2002) (“Subsection 1391(b)(3) would allow venue in Indiana . . . only if
‘there is no district in which the action may otherwise be brought’; because this action
may be prosecuted in Connecticut, this option is unavailable.”).
Venue would be proper in a judicial district in which any defendant is located,
if all defendants are residents of the States. 28 U.S.C. § 1391(b)(1). Defendant Luckey
is headquartered in the Central District of Illinois; therefore, the Central District of
Illinois would be proper venue if all of the defendants are residents of Illinois.
However, Plaintiff has not alleged enough facts to show that Defendant Affton is a
resident of any district of Illinois.4
Because Defendant Affton is a corporation and Illinois has multiple judicial
districts, Defendant Affton’s “residency” is determined by whether its contacts with
the Central District of Illinois would be sufficient to subject it to personal jurisdiction
if the district was a separate state. 28 U.S.C. § 1391(d). However, Plaintiff has not
alleged that Defendant Affton has any specific contacts with the Central District of
Illinois. Nor has Plaintiff alleged that Defendant Affton has any specific contacts with
the Northern or Southern Districts, which could also support residency in Illinois
under § 1391(d) and proper venue in the Central district pursuant to § 1391(b)(1).
Rather Plaintiff has only alleged generally that Defendant Affton conducts business
in the state of Illinois; which is not sufficient to establish that Defendant Affton is a
resident under § 1391(d). See KM Enters., Inc. v. Global Traffic Techs., Inc., 725 F.3d
718, 733 (7th Cir. 2013) (“Section 1391(d) requires analysis of a defendant’s contacts
with the specific district; if these are insufficient, then venue is not proper, regardless
of the defendant’s contacts elsewhere in the state.”).
Therefore, the Court finds that the Central District of Illinois is not a proper
venue for the Defendant Affton under either the Carmack Amendment’s special
venue provision or the general venue provision.
Plaintiff argues that it should be sufficient for venue purposes that the Central
District of Illinois is a proper venue for Defendant Luckey, because “Carmack’s
The Court notes that Defendant Affton argues that because it is headquartered in
St. Louis, Missouri, it is not a resident of Illinois. However, that disregards the
definition of resident that the general statute provides. See 28 U.S.C. § 1391(c)-(d).
purpose is to relieve cargo owners of the burden of searching out a particular
negligent carrier from among the often numerous carriers handling interstate
shipment of goods.” Kawasaki Kisen Kaisha Ltd. V. Regal-Beloit Corp., 561 U.S. 89,
98 (2010) (quoting Reider v. Thompson, 339 U.S. 113, 119 (1950)). However, the
Carmack Amendment’s purpose is not sufficient to establish a rule that a court must
only find proper venue for one defendant.
The general rule is that venue must be proper for each defendant and each
claim. Emjayco, 901 F. Supp. at 1400. Plaintiff has provided no legal support for the
argument that if venue is found proper for one Carmack Amendment defendant, that
it is proper for all. Furthermore, Plaintiff’s argument that the Carmack Amendment’s
purpose is sufficient to support that rule is unpersuasive here. Plaintiff is correct in
asserting that the purpose of the Carmack Amendment is to prevent cargo owners
from having to search out a particular carrier amongst many carriers; however, that
occurs when Shippers A, B, and C all provide transportation in delivering the goods
from the first place to the second. Then, the Carmack Amendment provides that there
should be just one bill of lading and the plaintiff should not have to “search out” the
particular carrier. However, here we have four single deliveries that were made by
two different delivery companies; the companies were not responsible for separate
portions of one delivery process, but rather four distinct deliveries, which produced
four separate bills of lading. Therefore, the facts here are distinguishable and
Plaintiff’s argument is insufficient to provide proper venue.
Furthermore, Plaintiff’s concern that “[a]doption of Affton’s argument would
force claimants to bring suits in multiple jurisdictions for the same claim” is
unwarranted. As will be discussed in more detail below, the District of Nebraska
serves as a proper venue for both Plaintiff’s claims against Defendant Affton and
Defendant Luckey. Therefore, there is a single location where Plaintiff would be able
to properly bring one suit against both Defendants.
D. REMEDYING THE IMPROPER VENUE
Because the Court finds that the Central District of Illinois is the improper
venue for Defendant Affton, the Court must now address the proper remedy. When a
district court is an improper venue, the Court “shall dismiss, or if it be in the interest
of justice, transfer such a case to any district or division in which it could have been
brought.” 28 U.S.C. § 1406(a). Therefore, when venue is proper as to one defendant
but not another, the Court has three options: 1) it may dismiss the action; 2) it may
transfer the entire case to another district where venue is proper for all defendants,
or 3) sever the claims in the case and retain jurisdiction over those defendants for
whom venue is proper. See, e.g., Alltech, Inc. v. Carter, No. 5:08-cv-00325-KKC, 2010
WL 988987, at *4 (E.D. Ken. Mar. 15, 2010).
Defendant Affton argues that the claim should be dismissed because Plaintiff
failed to meet its burden to establish proper venue. However, dismissal for improper
venue is generally disfavored when the case could be transferred to a proper district.
See Nanz Trustee, Inc. v. Amer. Nat’l Bank & Trust Co., 423 F. Supp. 930, 932 (E.D.
Wis. 1977) (“Dismissal of an action for improper venue is a severe penalty. . .
.Dismissal therefore should be reserved for that action where its institution in an
improper forum smacks of harassment or evidences some other element of bad faith
on the plaintiff’s part.”) (quoting Moore’s Federal Practice para. 0.146 (2d ed. 1976)
at 1666); Van Gelder v. Taylor, 621 F. Supp. 613, 621-22 (N.D. Ill. 1985) (“Normally,
if venue is not proper in the district court where the action is initiated, transfer to a
proper district or division is preferred over dismissal.”) (citations omitted).
Furthermore, because the alleged events took place between December 19, 2014 and
January 29, 2015, there is a possibility that if the claims were dismissed, any claim
Plaintiff refiled in a proper venue would be untimely.5 See also Granger v. Rauch, 388
F. App’x 537, 541 (7th Cir. 2010) (collecting cases which hold that transfer from an
improper venue is preferable to dismissal to protect against timeliness and statute of
limitations issues). Therefore, the Court finds that it is not in the interest of justice
to dismiss the claim.
E. THE DISTRICT OF NEBRASKA IS A PROPER VENUE FOR BOTH DEFENDANTS
Because venue is proper for all Defendants in the District of Nebraska, the
Court finds that the best remedy is to transfer the entire case there.6 In order to
The Court notes that the time in which Plaintiff must file a claim is governed by the
bill of lading. The Carmack Amendment only provides that “[a] carrier may not
provide by rule, contract, or otherwise . . . a period of less than 2 years for bringing a
civil action against it under this section.” 49 U.S.C. § 14706(e)(1). However, this
limitations period is not a rigid standard, but rather sets forth a reasonable time limit
for filing a claim. See Namatollahi v. Starving Students, Inc., No. 01-C-4310, 2002
U.S. Dist. LEXIS 16681, at *12-13 (N.D. Ill. Sept. 4, 2002) (citing Yamazen USA, Inc.
v. Chi. & NW Transp. Co., 790 F.2d 621, 623 (7th Cir. 1986)). As the statute’s plain
language indicates, the limitations are minimum time frames, not maximum. Id.
Therefore, without the bills of lading, the Court cannot be certain of the timeliness of
any future filing by Plaintiff; however, the Court notes that the alleged events took
place more than two years ago, which would cause timeliness concerns if the bills of
lading do not provide more time than the minimum years.
Although none of the parties requested a transfer to the District of Nebraska, a
court, where venue is improper, may sua sponte transfer the case to a district where
venue is proper, pursuant to 28 U.S.C. §1406(a). See, e.g., Sasso USA, Inc. v. Zein
Invs., LLC, No. 14-C-2057, 2014 U.S. Dist. LEXIS 135692, at *7 (N.D. Ill. Sept. 24,
2014) (“[w]here venue is improper, the court can sua sponte transfer the case to a
transfer it, the District of Nebraska must be a district where the case could have
originally been brought. The Court finds that the District of Nebraska has subject
matter jurisdiction because this is a civil action arising under the laws of the United
States, as outlined in 28 U.S.C. § 1331, because Plaintiff seeks relief under 49 U.S.C.
§ 14706. Additionally, the District of Nebraska has personal jurisdiction over both
Defendant Affton and Defendant Luckey.
Furthermore, the Court finds that the District of Nebraska would have
personal jurisdiction over both defendants. Nebraska’s long-arm statute provides
jurisdiction over any person7 who “transact[s] any business in this state.” Neb. Rev.
Stat. § 25-536 (2016). Both Defendants made deliveries into Nebraska, thereby
transacting business within the state. Furthermore, Defendants’ deliveries are
sufficient minimum contacts with Nebraska, such that a suit there would not offend
traditional notions of fair play and substantial justice. Int’l Shoe Co. v. Wash., 326
U.S. 310 (1945).
The Court finds that venue is proper as to both Defendants in the District of
Nebraska. Under the Carmack Amendment, venue is proper under the “delivery
carrier” provision because both Defendants operate in Nebraska by making deliveries
district where venue is proper under 28 U.S.C. § 1406(a)”) (citations omitted); MB
Fin. Bank, N.A. v. Walker, 741 F. Supp. 2d 912, 915 (N.D. Ill. 2010) (“moreover, a
court may sua sponte transfer a case for improper venue”); Thomas v. Exxon Mobil
Oil Corp., No. 2:06-CV-144-RL-PRC, 2007 U.S. Dist. LEXIS 9689, at *19-22 (N.D.
Ind. Feb. 8, 2007) (collecting cases supporting a court’s ability sua sponte transfer a
case under 28 U.S.C. § 1406(a)).
Both a corporation (Defendant Affton) and a limited liability company (Defendant
Luckey) are considered a “person” under Nebraska law. Neb. Rev. Stat. § 25-535
there. 49 U.S.C. § 14706(d)(1). See, e.g., Ponce De Leon, 117 F. Supp. 3d at 130 (finding
proper venue under § 14706(d)(1) in districts where carriers “actually transport
property”). Additionally, venue would also be proper under the “carrier responsible
for loss” provision, because the damage to the all of polypropylene arguably occurred
when all four shipments were unloaded into one silo, in Nebraska. So while the
damage to one load of polypropylene occurred when it was placed in the tainted truck,
the damage to the entirety of the polypropylene occurred when the four shipments
were mixed, which occurred in Nebraska. 49 U.S.C. § 14706(d)(2). See also Ponce De
Leon, 117 F. Supp. 3d at 130 (finding proper venue under § 14706(d)(2) in the district
of the destination site). Lastly, venue is also proper to both Defendants under the
general venue statute because the District of Nebraska is the judicial district where
a substantial part of the events occurred. 28 U.S.C. § 1391(b).
Therefore, the Court finds that the claims could have originally been brought
in the District of Nebraska. The Court finds that it is in the interest of justice to
transfer the entire case to the District of Nebraska because the District of Nebraska
is the only proper venue for both Defendants. See, e.g., Kinney v. Anchorlock Corp.,
736 F. Supp. 818, 827 (N.D. Ill. 1990) (transferring a case under § 1406 to the “only
jurisdictionally viable forum proposed”).
Defendant Affton argues that the claims should be transferred to the District
of Kansas, because Defendant Affton’s shipment of the polypropylene began in
Kansas City, Kansas. However, as this opinion makes clear, the district court must
have jurisdiction and proper venue over both defendants. There is no indication that
the District of Kansas would have personal jurisdiction or be the proper venue for
Defendant Luckey, who is headquartered in Illinois and shipped the polypropylene
from Iowa to Nebraska.
Plaintiff asserts that the Court must weigh factors in considering whether to
transfer venue, as explained in Jaramillo v. DineEquity, Inc., 664 F. Supp. 2d 908
(N.D. Ill. 2009). The Court notes that Jaramillo discusses the factors considered when
determining a transfer of venue under 28 U.S.C. § 1404(a). Id. at 913. However, in
order for a case to be transferred under § 1404(a), the venue must be proper in the
transferring district—i.e. this Court. Because venue is not proper in this Court, §
1404 is not applicable. However, transfer under § 1406 is appropriate and it is in the
interests of justice to transfer the case, which will preserve Plaintiff’s claims against
possible timeliness issues and save Plaintiff an additional filing fee. See, e.g., Peek v.
Golden Nugget Hotel & Casino, 806 F. Supp. 555, 560 (E.D. Penn. 1992).
Furthermore, applying the traditional considerations of the “interests of
justice” factor support transferring the case to the District of Nebraska. First, the site
of the silo and the contaminated polypropylene is in Broken Bow, Nebraska;
therefore, the District of Nebraska is closer to the premise involved and has greater
community relations to the issue than the Central District of Illinois. The District of
Nebraska would also be closer for those witnesses involved in accepting the deliveries
at the Broken Bow site and discovering the tainted polypropylene.
Plaintiff stated that they took the contaminated samples back for quarantine
in Florida. Therefore, the evidence is over 1,000 miles from both the Central District
of Illinois and the District of Nebraska and the District of Nebraska would not be a
more inconvenient location for the evidence to be brought to. The Plaintiff does not
believe there will be any unwilling witnesses, therefore the convenience of witnesses
is not a consideration. Additionally, although Plaintiff’s choice of forum is usually
given weight that cannot apply when Plaintiff does not pick a proper venue. Overall,
the interest of justice clearly support transferring the case to the District of Nebraska.
Plaintiff also argues that the location of the damage is just as likely to have
occurred in Illinois as it did in Kansas. The Court disagrees. The transportations were
from Kansas City, Kansas to Broken Bow, Nebraska and from Des Moines, Iowa to
Broken Bow, Nebraska. There are no facts alleged that the transportations ever
passed through Illinois. Furthermore, given that Des Moines, Kansas City, and
Broken Bow are all west of Illinois, the Court finds it highly unlikely that the
transportations or the damage could have occurred in Illinois. Therefore, there is no
indication that the damage could have occurred in Illinois or, more specifically, the
Central District of Illinois. However, it is much more likely that the alleged damage
occurred in the District of Nebraska, when the four truckloads were combined in
The Court notes that Plaintiff’s response to Defendant Affton’s second motion
to dismiss for improper venue requests that “if this court determines that there is an
issue as to whether or not venue is proper under 49 U.S.C. § 14706(d)(2), Plaintiff
requests that . . . the court allow Plaintiff to conduct limited discovery aimed solely
at confirming that venue is proper. . . .” (Doc. 21 at 8). However, the Court finds that
discovery as to venue under 49 U.S.C. § 14706(d)(2) is unnecessary, because §
14706(d)(2) establishes proper venue in the judicial district where the damage is
alleged to have occurred. However, as discussed previously, there are no facts alleged
that any of the trucks were in Illinois or that the damage on the shipments between
Iowa, Kansas, and Nebraska could have occurred in Illinois.
For the forgoing reasons, the Central District of Illinois is an improper venue
for Defendant Affton. Therefore, under 28 U.S.C. § 1406 and in the interest of justice,
a transfer to the District of Nebraska is warranted because the District of Nebraska
is a proper venue for both Defendants and Plaintiff may continue its claims against
IT IS THEREFORE ORDERED:
Defendant Affton Trucking Company’s Motion to Dismiss or Transfer (Doc. 20)
is granted. This case is TRANSFERRED to the District of Nebraska. The Clerk is
directed to transfer the case. Defendant’s Motion to Dismiss (Doc. 15) and
Defendant’s Motion for Leave to File a Reply (Doc. 22) are DENIED AS MOOT.
Entered this _6th_ day of June, 2017.
s/ Joe B. McDade
JOE BILLY McDADE
United States Senior District Judge
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