Opinion
23-cv-3163-RJD
05-22-2024
EXPEDITED LOGISTICS, LLC, Plaintiff, v. ROCKET TRANSPORT, LLC, Defendant.
REPORT AND RECOMMENDATION
DALY, MAGISTRATE JUDGE:
On August 18, 2023, Plaintiff filed suit in the Circuit Court of Madison County, Illinois against Defendants Rocket Transport, LLC and Smith Dray Line & Storage Co., Inc. Doc. 1-1. Plaintiff's Complaint contains breach of contract and negligence claims against Rocket Transport, LLC, as well as claims against Smith Dray Line & Storage Co. for negligence and breach of “intended third-party beneficiary contract.” Id. This matter was assigned to the undersigned Magistrate Judge pursuant to Administrative Order 257. Doc. 3. Currently pending is Plaintiff's Motion to Remand (Doc. 12). However, Defendant Rocket Transport, LLC, has never appeared and therefore did not consent to magistrate judge jurisdiction. Accordingly, the undersigned issues this Report and Recommendation for a District Judge to consider whether this case should be remanded to the Circuit Court of the Third Judicial Circuit, Madison County, Illinois.
FINDINGS OF FACT
Attached to Plaintiff's Complaint is a contract between it and Rocket Transport, LLC (“Rocket Transport”) for Rocket Transportto provide transportation of goods for Plaintiff's customers. Id., pp. 6-12. Also attached to Plaintiff's Complaint is a bill of lading, reflecting that Smith Dray Line & Storage Co. (“Smith Dray”) “agreed to act as shipper” for carpeting that was transported from South Carolina to Florida for Plaintiff. Id., ¶19. Plaintiff alleges that the carpeting was damaged during that transport, and the receiver rejected the shipment. Id., ¶¶8,9.
Defendant Smith Dray was served on or around September 6, 2023 and removed the case to this court on September 20, 2023. Doc. 1, ¶¶2, 11. Four weeks after Smith Dray removed this case to this Court, Plaintiff and Smith Dray filed a Stipulation for Dismissal in which they agreed Plaintiff's claims against Smith Dray would be dismissed with prejudice. Docs. 13, 19.
The undersigned held a hearing on Plaintiff's Motion to Remand on May 20, 2024. Having been dismissed pursuant to the Stipulation, counsel for Smith Dray was not present. Counsel for Plaintiff appeared and explained that a process server attempted to serve Rocket Transport August 20, 23, and 26, 2023. Doc. 22, p. 5. Plaintiff's counsel informed the Court that the process server appeared three times at the address listed for Rocket Transport's registered agent, but the building/residence appeared vacant. Plaintiff's counsel then filed a Motion for Alternative Method of Service with the Circuit Court (the case had not yet been removed to this Court) that was granted on August 31, 2023, authorizing Plaintiff to serve Rocket Transport by serving the South Carolina Secretary of State. Service occurred on the South Carolina Secretary of State on September 7, 2023. Doc.21, pp. 1-3. Plaintiff's counsel informed the Court that Rocket Transport never appeared in state court, nor did it attempt to contact Plaintiff's counsel.
CONCLUSIONS OF LAW
In its Notice of Removal, Smith Dray cited two bases for subject matter jurisdiction in this Court: (1) 49 U.S.C. §14706, the “Carmack Amendment,” which is a federal statute imposing liability on carriers under bills of lading; and (2) 28 U.S.C. §1332, diversity jurisdiction. For diversity jurisdiction to exist, the amount in controversy must exceed $75,000. Plaintiff's Complaint seeks $18,254.28 in damages for its contract claims, and damages in excess of $10,000.00 for the negligence claims. Smith Dray made no argument in its Notice of Removal regarding whether the amount in controversy meets or exceeds $75,000.00. At the hearing on Plaintiff's Motion to Remand, Plaintiff's counsel explained that Plaintiff purposefully filed this case on the Arbitration Docket in the Circuit Court of Madison County because it is not seeking more than $50,000 in damages. Consequently, the record reflects that this Court does not have diversity jurisdiction to hear this case because less than $75,000.00 is at issue.
https://www.illinoiscourts.gov/courts-directory/100/Madison-County-Courthouse/court/ (last accessed May 21, 2024)
As for the Carmack Amendment, it provides a “uniform rule of carrier liability concerning interstate shipments” and it “generally preempts separate state-law causes of action that a shipper might pursue against a carrier for lost or damaged goods.” REI Transport, Inc. v. C.H. Robinson Worldwide, Inc., 519 F.3d 693, 697 (7th Cir. 2008) (internal citations and quotations omitted). A freight broker may recover as a “shipper” under the Carmack Amendment. Id. at 699. A Carmack Amendment claim may be removed from state court to federal court if the amount in controversy exceeds $10,000.00. 28 U.S.C. §1445(b).
Plaintiff did not expressly mention the Carmack Amendment in its Complaint, but it “cannot ‘bypass' the Carmack Amendment simply by avoiding reference to it in [its] state complaint.” Korer v. Danita Corp., 584 F.Supp.2d 1103, 1105 (N.D. Ill. 2008) (internal citations and quotations omitted). The crux of Plaintiff's Complaint is that Defendants damaged the carpeting on an interstate route, and therefore Plaintiff's claims are preempted by the Carmack Amendment. REI Transport, Inc., 519 F.3d at 698. Accordingly, the undersigned is satisfied that it has federal question jurisdiction. Korer, 584 F.Supp.2d at 1106, n.2.
However, when a Notice of Removal is premised on the Court's federal question jurisdiction, all served Defendants must “join in or consent to the removal of the action.” 28 U.S.C. §1446(b)(2)(A). Rocket Transport was served prior to Smith Dray removing the case to federal court. Doc. 1; Doc.21, pp. 1-3. Smith Dray's Notice of Removal is silent on the issue of whether Rocket Transport consented to removal; the undersigned can only assume that counsel for Smith Dray did not contact or could not contact Rocket Transport or its counsel. Errors in a removal petition can, in some instances, be corrected. Northern Illinois Gas Co. v. Airco Indus. Gases, a Division of Airco, Inc., 676 F.2d 270, 273 (7th Cir. 1982). Here, however, Smith Dray has been dismissed with prejudice and Rocket Transport never appeared, so neither Defendant has corrected the error.
One final requirement for remand is that Plaintiff must notify the Court of the error in the Notice within 30 days of removal; otherwise, any objections are waived. Matter of Continental Cas. Co., 29 F.3d 292, 295 (7th Cir. 1994). Plaintiff filed a Motion to Remand within 30 days of removal, contending that “.... Rocket has asserted no independent request for removal” which the undersigned construes as an argument that Rocket Transport failed to join in the Notice of Removal. Consequently, the record reflects that remand is appropriate.
RECOMMENDATIONS
The undersigned RECOMMENDS that Plaintiff's Motion for Remand (Doc. 12) be GRANTED and that this case be REMANDED to the Circuit Court of the Third Judicial Circuit, Madison County, Illinois pursuant to 28 U.S.C. §1447(c).
Pursuant to 28 U.S.C. § 636(b)(1) and SDIL-LR 73.1(b), the parties shall have fourteen (14) days after service of this Report and Recommendation to file any written objection(s). The failure to file a timely objection may result in the waiver of the right to challenge this Report and Recommendation before either the District Court or the Court of Appeals. See, e.g., Snyder v. Nolen, 380 F.3d 279, 284 (7th Cir. 2004).
The Clerk of Court is DIRECTED to assign a District Judge for consideration of the undersigned's Report and Recommendation.
IT IS SO ORDERED.