Summary
finding the Carmack Amendment preempted conversion, theft, and intentional misrepresentation claims when parties entered “into a single agreement that encompassed the storage and moving of her possessions, with the overall goal of completing a move from Brooklyn to San Francisco”
Summary of this case from Bums v. Masha Mobile Moving & Storage, LCCOpinion
Case No. C 02-01570 CRB
June 10, 2002
MEMORANDUM AND ORDER
Plaintiff filed this case in California Superior Court Defendant removed to this court and moved to dismiss. Now before the Court are defendant's motion to dismiss and an order to show cause as to why this case should not be remanded. Having carefully considered the papers filed and having had the benefit of oral argument on May 24, 2002, the Court hereby retains jurisdiction over the case and dismisses plaintiff's state law claims.
BACKGROUND
In the summer of 1999, plaintiff, Jennifer L Newens, was planning a move from Brooklyn, New York to San Francisco, California. She contacted defendant, Globe Moving Storage ("Globe") about the move.
According to the complaint, Newens "contracted with Globe to move her [possessions] from New York to San Francisco." First Amended Complaint ("FAC") ¶ 9. Plaintiff planned to move out of her Brooklyn residence before locating a San Francisco residence. Accordingly, as alleged, Globe agreed to store her possessions until she located a place to live in San Francisco. Id.
At some point prior to August 15, 1999, Globe subcontracted with defendant, In Out Moving and Storage ("In Out"), to pack and deliver plaintiff's possessions to Globe. It is not clear which entity was contractually responsible for storage of plaintiff's possession prior to shipping to San Francisco. In Out took possession of plaintiff's possessions on August 15, 1999.
The complaint also references In Out Moving and Trucking. The distinction does not appear to be significant for purposes of this motion.
On January 4, 2000, plaintiff called Globe to schedule delivery of her possessions. Globe replied that they did not have plaintiff's possessions and that she should call In Out In Out has similarly denied having plaintiffs possessions.
Plaintiff filed a claim in California Superior Court stating claims for 1) Loss or Injury to Freight Shipped in Commerce. 2) Conversion, 3) Theft, and 4) Intentional Misrepresentation. Defendant Globe removed to this Court contending that plaintiff's claims are completely preempted by the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. § 14706 (the "Carmack Amendment"). (Defendant In Out has not been served. In her motion papers, plaintiff claims that In Out is not in business anymore and that its principals have been indicted on racketeering charges.)
On April 19, 2002 this Court issued on Order to Show Cause as to why the complaint should not be remanded to state court.
DISCUSSION
I. Remand
Courts in the Ninth Circuit "strictly construe the moval statute against removal jurisdiction." Gaus v. Miles, Inc., 980 F.2d 564, 566 (9th Cir. 1992). "Federal jurisdiction must be rejected if there is any doubt as to the right of removal in the first instance." Id. Defendant, as the removing party, bears the burden of establishing that removal was proper. See id.
"Ordinarily, `federal jurisdiction exists only when a federal question is presented on the face of the plaintiffs properly pleaded complaint.'"Harris v. Provident Life and Accident Ins. Co., 26 F.3d 930, 934 (9th Cir. 1994) (citation omitted). Federal preemption is usually a federal defense to the plaintiff's suit. As a defense, it does not appear on the face of a well-pleaded complaint, and, therefore, does not authorize removal to federal court. Id. However, "`an independent corollary' to the well-pleaded complaint rule [is] the `complete preemption' doctrine."Id. Sometimes "the pre-emptive force of a statute is so extraordinary that it converts an ordinary state common-law complaint into one stating a federal claim for purposes of the well-pleaded complaint rule." Id. (quoting Caterpillar Inc. v. Williams, 482 U.S. 386, 393, (1987)) (internal citation omitted).
The Carmack Amendment governs the liability of movers for lost or damaged goods. The federal law is somewhat inconsistent with regard to whether the Carmack Amendment completely preempts related state law. Many cases say that it does not. See, e.g., Lamm v. Bekins Van Lines Co., 139 F. Supp.2d 1300, 1308 (M.D. Al. 2001); Ben Jerry's Homemade, Inc. v. KLLM, Inc., 58 F. Supp.2d 315, 318 (D.Vt. 1999). Many cases say that it does. See, e.g., Reeves v. Mayflower Transit, Inc., 87 F. Supp.2d 1251 (M.D. Ala. 1999); Duerrmeyer v. Alamo Moving and Storage One, Corp., 49 F. Supp.2d 934 (W.D. Tex. 1999). There appears to be no clear Ninth Circuit law on the issue.
The Court need not resolve this issue. Upon closer examination of the complaint, it is clear that plaintiff's first cause of action is brought under the Carmack Amendment, despite the fact that the Carmack Amendment is not explicitly referenced. Accordingly, the federal question is pleaded on the face of the complaint and federal removal jurisdiction is appropriate.
The Carmack Amendment in relevant part provides:
A carrier providing transportation or service . . . shall issue a receipt or bill of lading for property it receives for transportation under this part. That carrier and any other carrier that delivers the property and is providing transportation or service . . . are liable to the person entitled to recover under the receipt or bill of lading.49 U.S.C. § 14706(a)(1).
A plaintiff must allege three elements to establish a prima facie case of violation of the Carmack Amendment: (1) delivery of the goods to the initial carrier in good condition, (2) damage of the goods before delivery to their final destination, or failure to delivery altogether, and (3) the amount of damages. See Beta Spawn, Inc. v. FFE Transportation Services, Inc., 250 F.3d 218, 223 (3rd Cir. 2001).
The only credible reading of plaintiffs first cause of action is that it is an action for recovery under the Carmack Amendment. Plaintiff alleges that Globe is a motor carrier licensed by the United States Department of Transportation. FAC ¶ 1. She alleges that she delivered her possessions to In Out in good condition. FAC ¶ 11. She alleges that her possessions were never delivered. FAC ¶ 14. Finally, she alleges damages of $12,500. FAC ¶ 16.
Accordingly, jurisdiction in this Court is appropriate.
II. Motion to Dismiss
Defendant Globe has moved to dismiss plaintiff's state law causes of action because they are preempted by the Carmack Amendment.
It appears the defendant has actually moved to dismiss the entire complaint, but does not object to allowing plaintiff to file an amended complaint stating only a cause of action under the Carmack Amendment.
While there is some disagreement in the courts as to whether the Carmack Amendment completely preempts state law, courts are in agreement that the Carmack Amendment preempts common law state causes of action in that it provides a complete defense. See Adams Express Co. v. Croninger, 226 U.S. 491, 505-6 (1913) (holding that the Carmack amendment preempts state law); Hughes Aircraft Co. v. North American Van Lines, Inc., 970 F.2d 609, 613 (9th Cir. 1992) (Plaintiff "wisely concedes that federal law preempts any state common law action against [defendant carrier] acting solely as a common carrier. It is clear that the Carmack Amendment established a uniform national liability policy for interstate carriers.") As the First Circuit clarified more recently, "state laws that impose liability on carriers based on the loss or damage of shipped goods are preempted." Rini v. United Van Lines, Inc., 104 F.3d 502, 506 (1st Cir. 1997).
Accordingly, plaintiffs second claim for conversion and third claim for theft are clearly preempted because they are based on the failure of defendants to deliver plaintiff's possessions.
Plaintiff's fourth claim is intentional misrepresentation. This claim alleges that defendants made intentionally false representations to plaintiff regarding their intent to store and deliver plaintiff's possessions. Most cases hold that claims based on pre-shipment activities, including claims for intentional and negligent misrepresentation, are still preempted. See e.g., Moffit v. Bekins Van Lines Co., 6 F.3d 305, 306-7 (5th Cir. 1993); Pietro Culotta Grapes Ltd. v. Southern Pacific Transp. Co., 917 F. Supp. 713, 716 (E.D. Cal. 1996). Therefore, this claim must be dismissed also.
In response to the motion to dismiss, plaintiff concedes that "most claims involving goods lost in interstate commerce are preempted by the Carmack Amendment." She contends, however, that her case "involves goods which were lost or stolen while in storage, and no transportation ever took place." Therefore, she argues, the claims fall outside the scope of the Carmack Amendment. This is a difficult argument to support in light of the fact that the claim itself is captioned "loss or Injury to Freight Shipped in Commerce."
This is really an argument, in the first instance, that removal was inappropriate. Plaintiff, however, does not explicitly contest removal. She makes this argument in opposition to the motion to dismiss. Her opposition papers ask only that the motion to dismiss be denied, not that the case be remanded to state court.
But even if this were plaintiffs factual argument, the claim would be preempted. The statute, the limited case law, the allegations of the complaint, and common sense all compel the conclusion that loss or damage to possessions during intrastate transportation and storage of possessions, in preparation for an interstate move, are covered by the Carmack Amendment.
The Carmack Amendment explicitly defines "transportation" to include "services related to" moving, such as "storage." 49 U.S.C. § 13102(19). In Tayloe v. Kachina Moving Storage, Inc., 16 F. Supp.2d 1123 (D. Ariz. 1998), the court held that "[t]he transportation and storage of Plaintiffs' goods within the State of Arizona was part of Plaintiffs' interstate move from Illinois" for purposes of Carmack Amendment preemption analysis. Id. at 1128. The Court noted that there was only a single bill of lading between plaintiff and the mover. Specifically, the court stated:
The fact that Plaintiffs' goods were ultimately stored in Arizona for nine months does not change the character of the move. The Bill of Lading contemplated temporary storage of Plaintiffs' goods in Arizona at Kachina's storage facility. However, Plaintiffs requested that their goods be kept in storage for a longer period of time than that specified in the original Bill of Lading because the construction of their Arizona home was not yet complete. Plaintiffs have produced absolutely no evidence which suggests that Plaintiffs' goods were converted from storage-in-transit to permanent storage.Id. at 1128 n. 2.
Plaintiff claims that she entered into two specific agreements — one for storage and another for moving services. This claim, made in her opposition brief, is flatly contradicted by her complaint which states: "As a part of the contract, Globe agreed to hold her [possessions] in storage until she had located a place in California." FAC ¶ 9. The complaint makes absolutely no reference to a separate storage agreement. It is clear that plaintiff wanted her possessions stored only long enough to find a new residence in California, after which the possessions would be shipped. As alleged, plaintiff and Globe entered into a single agreement that encompassed the storage and moving of her possessions, with the overall goal of completing a move from Brooklyn to San Francisco. Therefore, plaintiffs claim must be made under the Carmack Amendment.
CONCLUSION
Plaintiff's second, third, and fourth claims for relief are hereby DISMISSED because they are preempted by the Carmack Amendment.