Beazley Insurance Company, Inc. v. Skylark Logistics, Inc. et al

MOTION TO DISMISS FOR FAILURE TO STATE A CLAIM with Brief In Support

N.D. Ga.February 24, 2017

1 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION BEAZLEY INSURANCE COMAPNY, ) INC., ) ) Plaintiff, ) ) -vs- ) CASE NO. 1:16-CV-04730-CAP ) SKYLARK LOGISTICS, INC., and ) THE TITAN BUSINESS GROUP, INC., ) ) Defendants. ) DEFENDANT SKYLARK LOGISTICS, INC.’S MOTION TO DISMISS COMES NOW the Defendant Skylark Logistics, Inc. (hereinafter "Skylark"), by and through Counsel, and pursuant to Federal Rule of Civil Procedure 12(b)(6), moves the Court for an order dismissing Plaintiff Beazley Insurance Company’s second and third causes of action in its Amended Complaint. In support of this motion, Skylark states the following: 1. This case arises out of the interstate shipment of cargo from Ontario, Canada to Duluth, Georgia in 2016. 2. On December 23, 2016, Plaintiff filed its Complaint alleging claims against all the defendants in this action, and in particular, alleging three claims against Skylark: (1) breach of duties under the Carmack Amendment; (2) breach of bailment obligations; and (3) negligence/gross negligence. Case 1:16-cv-04730-RWS Document 22 Filed 02/24/17 Page 1 of 3 2 3. On February 15, 2017, Plaintiff filed its Amended Complaint, but still asserting the same three causes of action against Skylark. 4. Since Plaintiff's claims against Skylark arise from the interstate transportation of goods, 49 U.S.C. §14706, which comprises part of a federal statute commonly known as the "Carmack Amendment", this statute solely governs Skylark’s liability, if any, for the alleged damage to the Plaintiff' insured’s cargo. 5. Pursuant to the doctrine of federal preemption, Skylark seeks dismissal of second and third causes of action against it raised in the Plaintiff's Amended Complaint on the basis that they consist of state law based claims which are preempted under federal law, as explained in further detail in Skylark’s Memorandum of Law filed contemporaneously herewith. WHEREFORE, Skylark Logistics, Inc. requests that this Honorable Court enter Judgment and grant this Motion to Dismiss the second and third causes of action against Skylark as set forth in Plaintiff’s Amended Complaint, and that this Court grant this Defendant any other and further relief as this Court deems just and equitable. Respectfully submitted, Dated: February 24, 2017 WILSON ELSER MOSKOWITZ EDELMAN & DICKER LLP By: /s/ Daniel E. Tranen DANIEL E. TRANEN GA State Bar No. 715425 Case 1:16-cv-04730-RWS Document 22 Filed 02/24/17 Page 2 of 3 3 101 West Vandalia Street, Suite 220 Edwardsville, Illinois 62025 Phone: (618) 307-0200 Fax: (618) 307-0221 Email: Daniel.tranen@wilsonelser.com Attorneys for Defendant Skylark Logistics, Inc. CERTIFICATE OF SERVICE The undersigned, an attorney, hereby certifies that on February 24, 2017, a true and correct copy of the above and foregoing pleading was served on all counsel of record through the Court’s ECF system. By: /s/ Daniel E. Tranen Daniel E. Tranen Case 1:16-cv-04730-RWS Document 22 Filed 02/24/17 Page 3 of 3 1 IN THE UNITED STATES DISTRICT COURT FOR THE NORTHERN DISTRICT OF GEORGIA ATLANTA DIVISION BEAZLEY INSURANCE COMPANY, ) INC., ) ) Plaintiff, ) ) -vs- ) CASE NO. 1:16-CV-04730-CAP ) SKYLARK LOGISTICS, INC., and ) THE TITAN BUSINESS GROUP, INC., ) ) Defendants. ) DEFENDANT SKYLARK LOGISTICS, INC.’S MEMORANDUM OF LAW IN SUPPORT OF ITS MOTION TO DISMISS COMES NOW the Defendant Skylark Logistics, Inc. (hereinafter "Skylark"), by and through Counsel, and in support of its Motion to Dismiss Counts Two and Three of the Amended Complaint, pursuant to Federal Rule of Civil Procedure 12(b)(6), states the following: I. INTRODUCTION This case arises out of an interstate shipment of telecommunication devices that Plaintiff insured from Ontario, Canada to Duluth, Georgia in 2016. Plaintiff's Complaint raises claims for breach of duties under the Carmack Amendment, breach of bailment obligations, and negligence/gross negligence against each of the defendants to the subject action, including Skylark, for alleged damages to the Case 1:16-cv-04730-RWS Document 22-1 Filed 02/24/17 Page 1 of 7 2 devices resulting from defendants’ alleged actions related to the interstate transportation of these devices. Skylark is a Canadian motor carrier, which transports cargo on an interstate and international basis, under authority granted by the U.S. Department of Transportation. Skylark was the carrier that transported the devices owned by Plaintiff’s insured from Canada to the U.S. Skylark's liability to the Plaintiff, if any, is governed exclusively by 49 U.S.C. §14706, which comprises part of federal statute commonly known as the Carmack Amendment (hereinafter "Carmack Amendment"). Therefore, Plaintiff’s second and third causes of action against Skylark, based exclusively on state law claims for breach of bailment obligations and negligence/gross negligence, are barred pursuant to the preemptive effect of the Carmack Amendment and should be dismissed pursuant to Rule 12(b)(6) of the F.R.Civ.P. Moreover, Plaintiffs request for attorneys fees should also be stricken as they are not available under the Carmack Amendment. II. STANDARD FOR MOTION TO DISMISS To prevail on a motion to dismiss under Rule 12(b)(6), the defendant must show that the plaintiff cannot prove a set of facts in support of its claim which would entitle him to relief. Conley v. Gibson, 355 U.S. 41, 45-46 (1957). Case 1:16-cv-04730-RWS Document 22-1 Filed 02/24/17 Page 2 of 7 3 The purpose of a motion under Rule 12(b)(6) is to test the formal sufficiency of the complaint. Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007). The Court will not assume that the plaintiff can prove facts different from those alleged in the complaint. Associated Gen. Contractors of Cal. v. Cal. State Council of Carpenters, 459 U.S. 519 (1983). "The issue is not whether a plaintiff will ultimately prevail but whether the claimant is entitled to offer evidence to support the claims." Scheuer v. Rhodes, 416 U.S. 232, 236 (1974). III. ARGUMENT Congress first began regulating interstate transportation of goods with the establishment of the Interstate Commerce Commission in 1887 by the Interstate Commerce Act. The Carmack Amendment was originally enacted in 1906 as an amendment to the Interstate Commerce Act of 1887, and is now part of the Interstate Commerce Commission Termination Act of 1995. Stephenson v. Wheaton Van Lines, Inc., 240 F. Supp. 2d 1161, 1164 (D. Kan. 2002). The Carmack Amendment provides in relevant part: “a State, political subdivision of a State, or political authority of 2 or more States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of any motor carrier…or any motor private carrier, broker, or freight forwarder with respect to the transportation of property.” 49 U.S.C. § 14501(c)(1). Case 1:16-cv-04730-RWS Document 22-1 Filed 02/24/17 Page 3 of 7 4 The Carmack Amendment governs all claims for damages to goods by a carrier shipping in interstate commerce. Smith v. United Parcel Service, 296 F.3d 1244, 1246 (11 th Cir. 2002). Any state tort or contract claim for such damage is preempted by the Amendment. Id. The goal of the Carmack Amendment is to create “a uniform rule for carrier liability when goods are shipped in interstate commerce.” Id. at 1247 (this uniform rule effectively preempts any claims that “relate to the delivery of goods.”); Hubbard v. All States Relocation Services, Inc., 114 F.Supp.2d 1374 (S.D. Ga. 2000). In Hubbard, plaintiff asserted state tort and contract law claims against the defendant for the failure to transport plaintiff’s household goods to his new home. The Hubbard court granted defendant’s motion to dismiss plaintiff’s complaint to the extent the complaint sought damages for the loss of the household goods. Id. at 1382. The Hubbard court held that because Congress’s regulation of the liabilities of a carrier to a shipper for lost or damaged goods was so extensive as to cover almost every detail, Congress intended to preempt all state or common law claims regarding such goods in interstate commerce. Here, like Hubbard, because Plaintiff has plead state common law claims in its second and third causes of action against Skylark and because these causes of action are preempted by the Carmack Amendment, Plaintiff’s second and third Case 1:16-cv-04730-RWS Document 22-1 Filed 02/24/17 Page 4 of 7 5 causes of action in its Amended Complaint should be dismissed for failure to state a claim upon which relief can be granted. In addition, Plaintiff seeks its attorneys’ fees in the ad damnum clause of its Amended Complaint. Because no cause of action asserted by Plaintiff provides for attorneys’ fees as a component of damages, this aspect of Plaintiff’s claim should be stricken by this Court. See e.g. Patriot Signs, Inc. v. SAIA Motor Freight Lines, LLC, 616 F.Supp.2d 646, 649 (N.D. Texas 2009) (“because the Carmack Amendment – which does not provide for attorney’s fees – governs this case, insofar as Plaintiff’s Petition in this action provides for a claim of attorney’s fees, the Court finds that it has failed to raise a right to relief sufficient to state a claim”). IV. CONCLUSION For the foregoing reasons, Skylark Logistics, Inc. respectfully requests that this Honorable Court grant its Motion to Dismiss the Plaintiff’s second and third causes of action against Skylark in their entirety as set forth in Plaintiff’s Amended Complaint, and seeks any such other and further relief as this Court deems just and equitable. Case 1:16-cv-04730-RWS Document 22-1 Filed 02/24/17 Page 5 of 7 6 Dated February 24, 2017 Respectfully submitted, WILSON ELSER MOSKOWITZ EDELMAN & DICKER LLP By: /s/ Daniel E. Tranen DANIEL E. TRANEN GA State Bar No. 715425 101 West Vandalia Street, Suite 220 Edwardsville, Illinois 62025 Phone: (618) 307-0200 Fax: (618) 307-0221 Email: Daniel.tranen@wilsonelser.com Attorneys for Defendant Skylark Logistics, Inc. Case 1:16-cv-04730-RWS Document 22-1 Filed 02/24/17 Page 6 of 7 7 CERTIFICATE OF SERVICE The undersigned, an attorney, hereby certifies that on February 24, 2017, a true and correct copy of the above and foregoing pleading was served on all counsel of record through the Court’s ECF system. By: /s/ Daniel E. Tranen Daniel E. Tranen Case 1:16-cv-04730-RWS Document 22-1 Filed 02/24/17 Page 7 of 7