Specialty Freight Services, Inc. v. Morris Trans Corp

Filing 14

MEMORANDUM (Order to follow as separate docket entry) re 10 MOTION for Default Judgment as to Morris Trans Corp. filed by Specialty Freight Services, Inc. We find that the unchallenged facts do not constitute a legitimate cause of action. We will therefore deny the plaintiffs motion for default judgment.An appropriate order follows. Signed by District Judge Joseph F Saporito, Jr on 3/11/25. (ms)

UNITED STATES DISTRICT COURT
MIDDLE DISTRICT OF PENNSYLVANIA
SPECIALTY FREIGHT SERVICES,
INC, ASSIGNEE OF J&J SNACK
FOODS SALES CORP., INC.,
CIVIL ACTION NO. 3:24-CV-00672
Plaintiff,

(SAPORITO, J.)

v.
MORRIS TRANS CORP.,
Defendant.
MEMORANDUM
This matter comes before the Court on the plaintiff ’s motion to
enter default judgment under Rule 55(b)(1) of the Federal Rules of Civil
Procedure. The plaintiff, Specialty Freight Services (“SFS”), filed its
complaint against the defendant, Morris Transportation Corporation
(“Morris”), on April 18, 2020. (Doc. 1). The defendant, however, failed to
appear before the Court or respond to the complaint, and the plaintiff
subsequently moved for entry of default on May 22, 2024. (Doc. 7). The
Clerk of Court entered that default on May 30, 2024. (Doc. 9). The
plaintiff has now moved for a default judgment. (Doc. 10). 1

1

We note that the plaintiff has incorrectly requested a default

(continued on next page)

I.

Background2

The plaintiff is a federally-licensed property broker operating under
authority

issued

to

it

by

the

Federal

Motor

Carrier

Safety

Administration. The defendant is a foreign business corporation
organized and presently dissolving under the laws of the state of New
Jersey. It is additionally a federally licensed motor carrier of property
operating under authority by the Federal Motor Carrier Safety
Administration.
On May 18, 2023, SFS and Morris entered into a Broker Carrier
Contract Agreement (hereinafter “Agreement”), in which Morris agreed
to transport 26 pallets of frozen snack foods to Vistar Northwest in
Portland, Oregon. The Agreement provided, among other stipulations,
that Morris furnish vehicles properly equipped for the transportation of
the described commodities and maintain liability for all actual loss,
damage, injury, or delay of shipments transported pursuant to the

judgment pursuant to Rule 55(b)(1) of the Federal Rules of Civil
Procedure, as the plaintiff has not only sought a sum certain, but also
attorneys’ fees. Therefore, we will construe the plaintiff ’s motion as an
application for a default judgment under Rule 55(b)(2) of the Federal
Rules of Civil Procedure.
2 All facts are taken from the plaintiff ’s complaint. (Doc. 1).
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Agreement, including attorneys’ fees and additional court-related costs.
The plaintiff alleges that the shipment of frozen snack foods was
delivered to Morris in good order and condition, with shipping labels
clearly describing the temperature-sensitive nature of the shipment. SFS
additionally contends that at some point during its transit to Vista
Northwest, the frozen snacks were thawed due to increased temperatures
within the carrier. The plaintiff has provided documentation of the truck
driver’s written admission of this allegation. On arrival, the goods were
subsequently refused by Vista Northwest as the thawing caused by the
fluctuating temperature changes deemed the goods unsalvageable. The
shipment was then taken to a landfill, causing the destruction of
$52,637.64 worth of product.
The plaintiff requests $62,804.90 for damaged goods, attorneys’
fees, and previously-paid freight charges under three claims: (1) liability
under the Carmack Amendment; (2) breach of contract; and (3)
negligence.
II.

Legal Standard

The entry of a default judgment is governed by Rule 55 of the
Federal Rules of Civil Procedure. The entry of default “is a prerequisite

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to entry of a default judgment under Rule 55(b).” Sys. Indus., Inc. v. Han,
105 F.R.D. 72, 74 (E.D. Pa. 1985). The Clerk of Court must enter a default
against a defendant that has “failed to plead or otherwise defend, and
that failure is shown by affidavit or otherwise.” Fed. R. Civ. P. 55(a). A
plaintiff may move for a default judgment pursuant to Rule 55(b) only
after default has been sought and entered by the Clerk under Rule 55(a).
Fed. R. Civ. P. 55(a),(b)(2).
Nevertheless, the decision to enter a default judgment lies
ultimately with the discretion of the district court. See Chamberlain v.

Giampapa, 210 F.3d 154, 164 (3d Cir. 2000). Courts faced with a motion
for default judgment consider the three Chamberlain factors: “(1)
prejudice to the plaintiff if default is denied, (2) whether the defendant
appears to have a litigable defense, and (3) whether the defendant’s delay
is due to culpable conduct.” Id. However, “when a defendant has failed to
appear or respond in any fashion to the complaint, this analysis is
necessarily one-sided; entry of default judgment is typically appropriate
in such circumstances at least until the defendant comes forward with a
motion to set aside the default judgment under Rule 55(c).” Asendia USA

v. AdvancePost, Inc., No. 1:12-CV-2169, 2013 WL 877132, at *1 (M.D. Pa.

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Mar. 8, 2013). Courts may even enter a default judgment “based solely on
the fact that the default has occurred.” Anchorage Assocs. v. Virgin

Islands Bd. of Tax Rev., 922 F.2d 168, 177 n.9 (3d Cir. 1990).
Even if a default judgment may be appropriate, however, the Court
must first “ascertain whether the unchallenged facts constitute a
legitimate cause of action, since a party in default does not admit mere
conclusions of law.” Serv. Emps. Int’l Union Loc. 32BJ, Dist. 36 v.

ShamrockClean, Inc., 325 F. Supp. 3d 631, 635 (E.D. Pa. 2018).
Nevertheless, while a defaulting party does not indeed admit those
conclusions, “the factual allegations of the complaint, except those
relating to the amount of damages, will be taken as true.” Comdyne I,

Inc. v. Corbin, 908 F.2d 1142, 1149 (3d Cir. 1990).
III.

Discussion

Before we analyze the substantive nature of the plaintiff ’s claims,
we must first briefly turn our attention to the plaintiff ’s supporting
documents for those claims. The record indicates that Morris was an
intermediary carrier for a shipment and delivery of J&J Snack Foods.
The plaintiff has provided two separate bills of ladings to confirm the

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shipment and delivery. 3 See (Doc. 13-1, at 13–14). The first bill of lading,
prepared and issued by the shipper, Gress Refrigerated Warehouse
(“Gress”), indicates that Morris picked up the shipment from the
warehouse. (Id., at 13). The second bill of lading, again issued by Gress,
proves that Morris delivered the shipment to Vistar Northwest. (Id., at
14). Most importantly, however, the second bill of lading notes that at
some point during the shipment, the “product thawed out and refroze,”
and Vistar Northwest rejected the shipment. (Id.). Indeed, this story is
corroborated by Morris’s truck driver, Giga Kasrelishvili. (Id., at 15).
Nonetheless, as the plaintiff has moved for default judgment, we find that
the plaintiff has failed to prove it contracted with Morris to transport the
spoiled goods at issue in the underlying action.
The plaintiff argues that SFS and Morris agreed to:
[T]ransport property, specifically 26 pallets of frozen
snack foods weighing 41,155 pounds, belonging to J&J
Snack Foods and being stored at a warehouse owned or
operated by Gress Refrigerated Services, from Scranton,
PA, on May 18, 2023, to consignee Vistar Northwest in
Portland, OR, at an agreed rate and pursuant to specific
3 We must acknowledge that while the plaintiff has provided copies

of the bills of ladings, the quality of those copies makes it difficult for the
Court to ascertain the details included within them. Therefore, we rely
on the plaintiff ’s affidavit to supplement those details. See generally
(Doc. 13-1).
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terms.
(Doc. 1, at 4). We acknowledge that the plaintiff has attached a copy of a
signed load-rate confirmation that details many of the alleged conditions
of the shipment. See (Doc. 13-1, at 9). The plaintiff, however, has not
provided any support that a load-rate confirmation can substitute as a
duly executed contract. We find that the load-rate confirmation merely
reflects an indication of a preliminary outline of a contract; we do not
view it as a duly executed contract that imposes liability on Morris.
Indeed, we believe that it is the broker-carrier agreement that outlines
the enforceable mutual obligations between the parties for purposes of
liability. See generally (Doc. 13-1, at 6–8). The plaintiff has unfortunately
failed to provide a copy of the duly executed broker-carrier agreement
between it and Morris.4 Without that agreement, we find it difficult to
ascertain any contractual liability placed upon the defendant by the

4 The plaintiff attached only an unsigned standard template of a

broker-carrier agreement to its complaint. (Doc. 1). On February 14,
2025, in consideration of the plaintiff ’s motion for default judgment, we
ordered the plaintiff to provide a complete, duly executed copy of the
broker-carrier agreement between the parties. (Doc. 12). On February 20,
2025, the plaintiff timely responded to our Order and reattached the
same incomplete standard broker-carrier agreement. (Doc. 13). The
plaintiff explained that “the original signed agreement was inexplicably
not saved.” (Doc. 13-1, ¶ 5).
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plaintiff, especially concerning the claims at issue in the underlying
action.
For example, the plaintiff has alleged liability under the Carmack
Amendment against the defendant. The Carmack Amendment to the
Interstate Commerce Act provides a cause of action for shippers against
carriers for the loss or damage of shippers’ goods during transportation.

Bunis v. Masha Mobile Moving & Storage, LCC, 674 F. Supp. 3d 186, 192
(E.D. Pa. 2023). The Amendment “imposes liability on a common carrier
for the actual loss or injury to goods in an interstate commerce shipment.”

Id. (citing Beta Spawn, Inc. v. FFE Transp. Servs., Inc., 250 F.3d 218, 223
n.4 (3d Cir. 2001)). Specifically, the Carmack Amendment provides:
[A] carrier providing transportation or service … shall
issue a receipt or bill of lading for property it receives for
transportation…. That carrier and any other carrier
that delivers the property … are liable to the person
entitled to recover under the receipt or bill of lading.

Id. (quoting 49 U.S.C.A. § 14706(a)(1)). To impose liability, shippers must
prove “(1) delivery of goods to the initial carrier in good condition, (2)
damage of the goods before delivery to their final destination, and (3)
amount of the damages” to recover for liability under the Act. Paper

Magic Grp., Inc., 318 F.3d at 461 (quoting Beta Spawn, Inc., 250 F.3d at

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223). The plain language of the Carmack Amendment, however, “governs
[only] the liability of common carriers on bills of ladings.” Bunis, 674 F.
Supp. 3d at 192 (quoting Paper Magic Grp., Inc. v. J.B. Hunt Transp.,

Inc., 318 F.3d 458, 461 (3d Cir. 2003).5
The attached bills of ladings in this action, however, only concern
four parties, none of which are SFS. The bills indicate that Morris picked
up a J&J Snack Foods shipment from Gress Refrigerated Warehouse and
transported it to Vistar Northwest. We cannot allow the plaintiff to
recover for liability under the Carmack Amendment when the bills the
claims are based on make no mention of the plaintiff in their entirety.
The plaintiff would need to show some sort of external causal relationship
to a shipper or carrier to recover for liability under the Act. Nonetheless,
because it has failed to provide the duly, executed broker-carrier
agreement necessary to prove that nexus, we cannot grant the plaintiff ’s
motion for default judgment on this count.
Indeed, the plaintiff ’s breach of contract claim against Morris fails
for similar reasons. To succeed on such a claim, the plaintiff must prove:

5 Bills of ladings are transportation contracts between a shipper or

consignor and a carrier. Bunis, 674 F. Supp. 3d at 192 n.37 (citing EF
Operating Corp. v. American Bldgs., 993 F.2d 1046, 1050 (3d Cir. 1993)).
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“(1) the existence of a contract, including its essential terms, (2) a breach
of a duty imposed by the contract and (3) resultant damages.” Key Consol.

2000, Inc. v. Troost, 432 F. Supp. 2d 484, 487 (M.D. Pa. 2006) (quoting
CoreStates Bank, Nat’l Assn. v. Cutillo, 723 A.2d 1053, 1058 (Pa. Super.
1999)). The plaintiff again, however, has failed to provide a duly executed
contract that imposes any liability on behalf of Morris. An enforceable
contract between parties must dictate “the nature and extent of its
obligation must be certain; the parties themselves must agree upon the
material and necessary details of the bargain.” Am. Eagle Outfitters v.

Lyle & Scott Ltd., 584 F.3d 575, 585 (3d Cir. 2009) (quoting Lombardo v.
Gasparini Excavating Co., 385 Pa. 388, 123 A.3d 663, 666 (1956)). The
plaintiff ’s broker-carrier contract template is missing all necessary
information to reflect any obligation, such as the date of the agreement,
the parties involved, and authorized signatures from either party.
Therefore, the incomplete contract prevents us from ascertaining the
nature and extent of Morris’s alleged obligations. Moreover, while bills of
lading are subject to the general rules of construction under common law,

see Texas & Pacific Ry. Cov. v. Reiss, 183 U.S. 621, 629–31 (1902), the
attached and signed bills of ladings show only a relationship between

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Morris, J&J Snack Foods, Gress Refrigerated Warehouse, and Vistar
Northwest. They fail to make any mention of, or reference to, SFS in their
entirety. Therefore, we find that SFS has failed to prove an existence of a
contract between itself and Morris that imputes any liability upon
Morris, and thus, a breach of any duty imposed by a contract. We will
deny the plaintiff ’s motion for default judgment on this claim.
In light of our analysis, we must additionally deny the plaintiff ’s
motion for default judgment concerning its negligence claim against the
defendant. “The primary element in any negligence cause of action is that
the defendant owes a duty of care to the plaintiff.” Jean v. Bucknell Univ.,
534 F. Supp. 3d 404, 411 (M.D. Pa. 2021) (quoting Althaus ex rel. Althaus

v. Cohen, 562 Pa. 547, 552, 756 A.2d 1166, 1168 (2000)). Here, the
plaintiff ’s negligence claim stems from the defendant’s “failure to
undertake and perform each and every one of the contractually agreedupon obligations and duties” alleged in its broker-carrier agreement.
(Doc. 1, ¶ 38). The plaintiff, however, has failed to provide a copy of the
duly executed broker-carrier agreement that imposes its alleged
“obligations and duties” upon the defendant. We therefore cannot hold
that the defendant owed a contractual duty of care to the plaintiff without

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any evidence indicating that the plaintiff and defendant were bound by a
valid contract. We must deny the plaintiff ’s motion for default judgment
on this claim.
III.

Conclusion

For the following reasons, we find that the unchallenged facts do
not constitute a legitimate cause of action. We will therefore deny the
plaintiff ’s motion for default judgment.
An appropriate order follows.

Dated: March 11, 2025

s/Joseph F. Saporito, Jr.

JOSEPH F. SAPORITO, JR.
United States District Judge

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