Opinion
No. C 04-02234 WHA.
August 18, 2004
ORDER GRANTING MOTION TO DISMISS STATE-LAW CLAIMS
In this interstate-shipment case, defendant United Van Lines moves to dismiss plaintiff's state-law claims on the ground they are preempted by the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. 14706. This order GRANTS the motion.
The relevant facts set forth in the complaint are assumed true on this motion. On July 2, 2003, plaintiff Mark Hellinski entered into a contract with defendant for the transportation of his household goods and furnishings from Portland, Maine to San Francisco, California. Once the shipment arrived in San Francisco, plaintiff unpacked and took inventory of his property. He found three items missing, including a Gibson guitar, an Artemide lamp and a key to his car's trunk. Other items like a sofa, a bed and mattress, a chair, a picture frame and a television set had been damaged. A bottle of face wash had also spilled. Plaintiff submitted a claim for these items to defendant on September 24, 2003 (Compl. Exh. A). He sought compensation in the amount of $21,440 for his losses ( ibid.).
On December 22, 2003, defendant responded that it had investigated the merits of plaintiff's claim and determined that he was only entitled to $1,905, less the $500 deductible on an insurance policy worth $60,000 that plaintiff had purchased to cover the shipment at issue ( id. at Exh. B). Included with defendant's letter was a check in the amount of $1,405, tendered as a full and final settlement of plaintiff's claim for damages (except as to plaintiff's sofa, which defendant continued to investigate) ( ibid.). Plaintiff did not cash the check ( id. ¶ 12).
Instead, plaintiff commenced the instant action on April 26, 2004, in San Francisco Superior Court alleging that defendant had failed to carry and deliver plaintiff's goods pursuant to the provisions of the parties' bill of lading. The complaint asserts four claims. The first seeks relief under the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. 14706, as well as California Civil Code Section 2194. The remaining three claims are for negligence, tortious breach of contract and conversion. Defendant removed the case to this Court on June 7, 2004. It now seeks to dismiss certain claims on federal preemption grounds.
The Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. 14706, was passed by Congress in 1906 and established a uniform national liability policy for interstate carriers. New York, New Haven Hartford Railroad Co. v. Nothnagle, 346 U.S. 128, 131 (1953). Indeed, within years of the amendment's enactment, the United States Supreme Court in Adams Express Co. v. Croninger, 226 U.S. 491 (1913), defined the amendment's preemptive effect in the broadest terms:
Almost every detail of the subject is covered so 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.Id. at 505-06. As such, the amendment completely preempts state-law claims, whether founded in tort or contract, against interstate carriers based on loss or damage to shipped goods. Ibid; Hughes Aircraft Co. v. North American Van Lines, Inc., 970 F.2d 609, 613-14 (9th Cir. 1992) (noting that the shipper in that case "wisely concedes that federal law preempts any state common law action against . . . a common carrier"). Accordingly, the Carmack Amendment provides the exclusive remedy for an action for damages against a delivery carrier.
In the present case, plaintiff offers little resistance to the inescapable conclusion that his claims based on state law, e.g., California Civil Code Section 2194, negligence, tortious breach of contract and conversion, cannot go forward in light of the preemptive breath of the Carmack Amendment. Given that the state claims seek no relief for harm sustained independent from the loss or damage to plaintiff's goods, the claims must be DISMISSED.
With that said, plaintiff's first claim for relief does invoke the Carmack Amendment, which provides in relevant part that:
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 . . . [is] liable to the person entitled to recover under the receipt or bill of lading. The liability imposed under this paragraph is for the actual loss or injury to the property . . .49 U.S.C. 14706(a). Plaintiff has alleged legally sufficient facts to support a claim for damages against defendant for the actual loss or injury to plaintiff's property under federal law. Plaintiff, for instance, asserts that he delivered his property in good condition to defendant for shipment from Maine to California, that all of his property was itemized, that he purchased a policy of insurance with "full value protection," and that some of plaintiff's goods and furnishings upon arrival were damaged or not delivered at all. This federal claim thus survives.
Plaintiff maintains that another question remains — that is, "whether his recovery will at the time of trial be limited by the provisions of 49 U.S.C. § 14706 to the extent that he may not be able to recover the exemplary and punitive damages he has requested in addition to his actual losses" (Opp. 3). Plaintiff, however, is mistaken.
The plain language of the Carmack Amendment provides that a shipper's sole remedy is limited to the "actual losses or injury to the property" transported. 49 U.S.C. 14706. To allow plaintiff to seek relief greater than that permissible under the Carmack Amendment would undermine the certainty that Congress intended to provide in cases such as this one. Although the Ninth Circuit has not directly spoken on this damage issue, most circuit courts have persuasively rejected punitive damages under the Carmack Amendment. See, e.g., Smith v. United Parcel Service, 296 F.3d 1244, 1247-49 (11th Cir. 2002). Gordon v. United Van Lines, Inc., 130 F.3d 282, 287 (7th Cir. 1997); Morris v. Covan Worldwide Moving, Inc., 144 F.3d 377, 383 (5th Cir. 1998) Cleveland v. Beltman North American Co., Inc., 30 F.3d 373, 379 (2d Cir. 1994). Plaintiff points to no authority to the contrary. His claim for punitive damages is thus also preempted.
At the hearing on this matter, plaintiff's counsel nonetheless requested that he be allowed leave to amend his complaint and allege a claim for punitive damages. No such amendment will be allowed. Based on the authorities cited above and the clear language of the Carmack Amendment, an amendment on this ground would be futile. As this case goes forward, the focus will be on whether plaintiff can prove his claim of actual loss or injury, and the amount thereof, under applicable federal law.
IT IS SO ORDERED.