OHL North America Transportation et al v. Chris Crossley's Trucking Adventures
Filing
16
OPINION and ORDER - For the reason stated, Defendant's Motion to Strike 8 is DENIED. DATED this 17th day of April, 2013, by United States Magistrate Judge John V. Acosta. (peg)
UNITED STATES DISTRICT COURT
DISTRICT OF OREGON
PORTLAND DIVISION
OHLNORTHAMERICA TRANSPORTATION;
and NATIONAL UNION FIRE INSURANCE
COMPANY OF PITTSBURGH, PA,
Plaintiff(s)
Case No. 3:12-cv-1130-AC
OPINION
AND ORDER
v.
CHRIS CROSSLEY'S TRUCKING ADVENTURES.,
Defendant
ACOSTA, Magistrate Judge:
Introduction
Plaintiffs, National Union Fire Insurance Company of Pittsburgh, PA, ("National Union")
and OHL North America Transportation ("OHL") (collectively, "Plaintiffs"), assert claims
against defendant Chris Crossley's Trucking Adventures ("Crossley Tmcking"), for breach of
contract and negligence. Both parties agree that the claims are governed by 49 U.S.C. § 14706
(the "Carmack Amendment"). Crossley Trucking now moves to strike allegations relating to
breach of contract and negligence pursuant to Federal Rule of Civil Procedure ("Rule") 12(f),
assetiing that those allegations are immaterial and impertinent in a Carmack Amendment case,
which applies to loss of or damage to goods moving in interstate commerce. Adams Express Co.
OPINION AND ORDER
{NDW}
v. Croninger, 226 U.S. 491, 499 (1913). Plaintiffs oppose the motion to strike, arguing that
while neither breach of contract nor negligence need be pleaded to make out a prima facie case
under the Carmack Amendment, breach of contract and negligence are both issues that are
routinely litigated in Carmack Amendment cases.
1
Background
National Union is a cargo insurer.
(Campi.
~
II.)
OHL, a freight forwarder and
transpmiation management company, insured by National Union, was the shipper of the
shipment of meat product ("the Shipment") at issue in this suit.
(Campi.~
III.) Chris Crossley's
Trucking Adventures is a common carrier of goods for hire and acted as the carrier of the
Shipment. (Camp.
~IV.)
Crossley Trucking transported the Shipment from the Pilgrims Pride
Corporation distribution center in Pittsburg, Texas, to Sygma Clackamas in Clackamas, Oregon,
pursuant to bill of lading numbers 79513/79514, dated June 27, 2011.
Shipment was damaged during shipment as a result of temperature abuse.
(Campi.
(Campi.~
~
V.) The
VI.)
On June 25, 2012, Plaintiffs filed this action alleging breach of contract and negligence
pursuant to the Carmack Amendment. On October 25, 2012, Crossley Trucking filed a motion to
strike arguing that breach of contract and negligence allegations are immaterial and impetiinent
in a Catmack Amendment case.
Legal Standard
Pursuant to Rule 12(1), "the court may order stricken from any pleading any insufficient
defense or any redundant, immaterial, impetiinent, or scandalous matter." '"Immaterial' matter
is that which has no essential or important relationship to the claim for relief or the defenses
being pleaded."' Fantasy, Inc. v. Fogerty, 984 F.2d 1524, 1527 (9th Cir. 1993), rev'd on other
1
Patiies requested oral argument. The comi concludes that oral argument is not necessary for
disposition of this motion. Local Rule 7-l(d)(l).
OPI!'\IION Al'\ID ORDER
2
{NDW}
grounds, Fogerty v. Fantasy, Inc. 510 U.S. 517, 534-535 (1994) (citing 5 Charles A. Wright &
Arthur R. Miller, FEDERAL PRACTICE & PROCEDURE§ 1382, at 706-07 (1990)). '"Impertinent'
matter consists of statements that do not pet1ain, and are not necessary, to the issues in question."
!d. at 711.
The purpose of a Rule 12(f) motion is to avoid the costs that arise from litigating spurious
issues by dispensing with those issues prior to trial. Motions to strike are generally viewed with
disfavor and are not fi·equently granted. See Bassiri v. Xerox Corp., 292 F. Supp. 2d 1212, 1220
(C.D. Cal. 2003), rev'd on other grounds, Bassiri v. Xerox Corp., 463 F.3d 927 (9th Cir. 2006).
Comis must view the challenged pleading in the light most favorable to the pleader. See
id. Generally, "motions to strike should be denied unless it can be shown that no evidence in
supp011 of the allegation would be admissible, or those issues could have no possible bearing on
the issues in the litigation." Gay-Straight Alliance Network v. Visalia Unified School Dist., 262
F. Supp. 2d 1088, 1099 (E. D. Cal. 2001). However, a motion to strike "may be proper if it will
make the trial less complicated or if allegations being challenged are so umelated to plaintiffs
claims as to be unwotihy of any consideration as a defense and that their presence in the pleading
will be prejudicial to the moving patiy." Thornton v. Solutionone Cleaning Concepts, Inc., No.
CIV F 06-1455 AWI SMS, 2007 WL 210586, at *1 (E.D. Cal. Jan. 26, 2007).
The Cannack Amendment "limits a carrier's liability under an interstate bill of lading to
'the actual loss or injury to the property caused by' the carrier."' Hall v. N. Am. Van Lines, Inc.,
476 F.3d 683, 686 n.2 (9th Cir. 2007). The Supreme Court of the United States has held that the
Carmack Amendment preempts all state statutory and common law claims against a motor
canier for loss of or damages to goods moving in interstate commerce. "Almost every detail of
the subject [liability of an interstate motor carrier under a valid bill of lading] is covered so
OPINION AND ORDER
3
{NDW}
completely that there can be no rational doubt but that Congress intended to take possession of
the subject and supersede all state regulation with reference to it." Adams Express, 226 U.S. at
499.
Discussion
Neither party disputes that the Carmack Amendment governs this case. The Catmack
Amendment imposes strict liability on all interstate carriers:
"The Catmack Amendment
imposes strict liability upon receiving carriers and delivering carriers in order to relieve cargo
owners of the burden of searching out a particular negligent catTier from among the often
numerous carriers handling an interstate shipment of goods." Pacific Jndem. Co. v. Atlas Van
Lines, Inc., 642 F.3d 702, 711 (9th Cir. 2011) (citation omitted). To properly plead a Carmack
Amendment claim, the plaintiff must show "that goods, which were dropped off in good
condition, anived in damaged condition (or not at all), and the amount of damages." Intercargo
Ins. Co. v. Burlington N Santa Fe R.R., 185 F. Supp. 2d 1103, 1111 (C.D. Cal. 2001) (citing
lvlissouri Pac. R.R. Co. v. Elmore and Stahl, 377 U.S. 134, 138 (1964)).
Crossley Trucking contends allegations of breach of contract and negligence are
immaterial and impertinent in Carmack Amendment cases because they are common law claims,
and the Carmack Amendment preempts common law claims against a motor catTier for loss of or
damage to goods moving in interstate commerce. Adams Express, 226 U.S. at 499. Plaintiffs
admit neither breach of contract nor negligence claims need be pleaded by a plaintiff to make out
a prima facie case under the Carmack Amendment. However, Plaintiffs maintain they have not
asserted these common-law causes of action. Instead, Plaintiffs assert that allegations of breach
of contract and negligence are issues routinely litigated in Carmack Amendment claims.
OPINION AND ORDER
4
{NDW}
Negligence and breach of contract causes of action are pre-empted by the Carmack
Amendment, so, the question is whether these allegations should be stricken from the pleadings.
In Bureerong v. Uvawas, 922 F. Supp. 1450 (C.D. Cal. 1996) the plaintiffs, who were immigrant
garment workers from Thailand, accused the defendants of falsely imprisoning them in a
complex in El Monte, California, and employing them in a system of involuntary servitude. The
plaintiffs filed both civil and criminal claims for personage and involuntary servitude, various
labor violations, violations of the Racketeer Influenced and Corrupt Organization Act ("RICO"),
violation of 42 U.S.C. § 1985(3), fraud, misrepresentation, intentional infliction of emotional
distress, assault, and false imprisonment. !d. at 1458. In response, the defendants filed a motion
to strike portions of the plaintiffs' first amended complaint. !d. at 1459.
The court agreed with the defendants that the inclusion of the term "Slave Sweatshop" in
the pleadings should be stricken. The term "Slave Sweatshop" added nothing to the material
allegations in the first amended complaint and appeared only for inflammatory effect. This was
enough for the court to strike the term from the first amended complaint as immaterial,
scandalous, and highly prejudicial. !d. at 1479.
The comi then denied defendants' Rule 12(b)(3) motion as to less offensive language in
the first amended complaint because this language was "extremely pe1iinent to plaintiffs' claims
that defendants are their employers, that defendants engaged in unfair business practices, and
that defendants were negligent." !d. at 1481. An example of language the court did not find to be
impe1iinent, scandalous and material was: "[the defendants] contracted with [the operators] to
produce garments at prices too low to permit payment of employees' minimum wages and
overtime." The comi also denied striking of "[m]anufacturers utilize the business practice of
contracting out garment manufacturing work in pmi to avoid compliance with labor laws and
OPINION AND ORDER
5
{NDW}
liability for violation of those laws." A third example of this less offensive language the comi
denied striking was: "[defendants] engaged and continue to engage in a pattern and practice of
contracting at unfairly low prices by utilizing garment contractors who are not registered and/or
who are chronic violators of labor laws, thus condemning plaintiffs and other garment workers to
long hours of work without minimum wages and overtime pay." Id
Similarly, in Whittlestone, Inc. v. Handi-Craft Co. 618 F.3d 970, (9th Cir. 2010), the
Ninth Circuit reversed the trial comi's order granting defendant's motion to strike. Plaintiff
alleged it had suffered "lost profits," "consequential damages," and the "loss of value of the
twenty year contract for Whittlestone products including minimum annual unit or dollar
purchases by Handi-Craft" and other "unearned credits and discounts." Id at 973-974. The Ninth
Circuit then dete1mined that this did not fulfill any of the five categories identified in Rule 12(f).
I d. at 973. The Ninth Circuit first cautioned lower courts not to resolve "disputed and substantial
factual or legal issue[ s] in deciding a motion to strike." I d. The Ninth Circuit then found that
"whether these damages are recoverable relates directly to the plaintiffs underlying claim for
relief' because the issue of the claim for lost profits could not be found immaterial at the
pleadings stage. Id. at 974. Similarly, it was not appropriate to strike the claim as "impertinent"
"because whether these damages are recoverable pertains directly to the harm being alleged." Jd.
The standard for granting a motion to strike in a Carmack Amendment case is high. In
Tuggle v. Piggyback Consolidators, Inc., No. CV 96-3745 CBM, 1997 WL 900835, at *1 (C.D.
Cal. Aug. 22, 1997), the comi granted the defendant's motion to strike on grounds that the
plaintiffs' state law claims of (1) breach of contract, (2) negligence, and (3) intentional infliction
of emotional distress and request for punitive damages were pre-empted by the Cmmack
Amendment. Id. Similarly, in FNS, Inc. v. Bowerman Trucking, Inc., No. 09-CV -0866-IEG
OPINION AND ORDER
6
{NDW}
(PCL), 2010 WL 532421, at *5-6 (Feb. 9, 2010), the court granted a motion to strike the
plaintiffs' prayer for attomey' s fees because in a Catmack Amendment case, plaintiffs are
entitled to attorneys' fees only when they are a shipper of household goods. !d. at *5-6 Because
the plaintiffs argued that the apportionment provision in § 14706(B) allows a carrier to seek
attorney's fees from the catTier who actually caused the loss, and Catmack Amendment case
precedent only recognized the availability of attorney's fees under § 14708, when they are a
shipper of household goods, the court in FNS granted the motion to strike. Id.
The case at hand is most similar to the Whittlestone case, because Plaintiffs' claims of
negligence and breach of contact do not rise to the level of being prejudicial, immaterial, and
impertinent. The language of "negligence" and "breach of contract" are on par with language
such as "lost profits" and "consequential damage" which the Whittlestone court found to not rise
to the level of needing to be stricken from the pleadings. Furthermore, the allegations here can
be distinguished from Bureerong, because "breach of contract" and "negligence" do not rise to
the level of being as prejudicial and unnecessary as the language "Slave Sweatshops."
In Carmack Amendment cases, the courts grant motions to strike state law claims and
prayers for attorney fees because the Carmack Amendment clearly pre-empted the state law
claims or did not provide for the attomey fees. Here, "breach of contract" and "negligence" are
not part of pre-empted state law claims, but simply alleged in support of the Carmack
Amendment case. Because the allegations of "breach of contract" and "negligence" are neither
pre-empted by the Carmack Amendment, and do not contradict the Carmack Amendment's
language, they should not be stricken from the pleadings at this time.
OPINION AND ORDER
7
{NDW}
Conclusion
For the reason stated, Defendant's Motion to Strike (#8) is DENIED.
DATED this 17th day of April, 2013.
OPINION AND ORDER
8
{NDW}
Disclaimer: Justia Dockets & Filings provides public litigation records from the federal appellate and district courts. These filings and docket sheets should not be considered findings of fact or liability, nor do they necessarily reflect the view of Justia.
Why Is My Information Online?