Carolina Cas. Ins. Co. v. Tony's Towing, Inc.

• Decision Date: 22 September 2011
• Docket Number: CA 11-0299-C
• Parties: CAROLINA CASUALTY INS. CO. and MARTHA E. VALENCIA d/b/a GONI TRUCKING, Plaintiffs, v. TONY'S TOWING, INC., Defendant.
• Court: U.S. District Court — Southern District of Alabama

CAROLINA CASUALTY INS. CO.and MARTHA E. VALENCIA d/b/aGONI TRUCKING, Plaintiffs,

v.TONY'S TOWING, INC., Defendant.

CA 11-0299-C

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF ALABAMA SOUTHERN DIVISION

Dated: September 22, 2011

MEMORANDUM OPINION AND ORDER¹

Pending before the Court are the defendant's motion to dismiss pursuant to Rules 12(b)(1) and 12(b)(6) and brief in support thereof (Doc. 6), filed July 8, 2011; the plaintiffs' opposition (Doc. 14), filed August 8, 2011 (see Docs. 9 & 12); and the defendant's reply in support (Doc. 17), filed August 23, 2011.² For the reasons set forth below, the Court finds that it lacks subject matter jurisdiction over this lawsuit, and the motion (Doc. 6) is, accordingly, GRANTED.

Background³

The events giving rise to the plaintiffs' complaint (Doc. 1), filed June 7, 2011, started on May 7, 2011, when a tractor-trailer—operated by plaintiff Martha E. Valencia d/b/a Gonia Trucking and insured by plaintiff Carolina Casualty—was involved in a single-vehicle accident on or near Interstate 10. Defendant Tony's Towing was dispatched to the scene by the Alabama Department of Public Safety, and upon arrival, was instructed by the State Trooper(s) to remove the cargo being transported and then transport the cargo and the tractor-trailer to Tony's terminal in Fairhope. Tony's then submitted an invoice to Carolina Casualty for $28,905.00, which Carolina Casualty disputes in part, conceding that it, on behalf of its insured, is responsible for payment of $13,480.00. Carolina Casualty further states that neither it nor its insured ever consented or agreed "to pay for the overpriced and excessive rates and hours and methodology contained in the invoice, which constitutes the remaining $15,425.00 of the $28,905.00 invoice." (Doc. 1, ¶16.) And although Carolina Casualty has offered to pay Tony's $13,480.00 of the disputed invoice, Tony's has not accepted the compromise, but it has released the cargo only, not the tractor-trailer.

The complaint—in which plaintiffs set forth seven causes of action: declaratory judgment; declaratory judgment with interpleader; conversion of tractor; conversion oftrailer; tortious interference with business or contractual relationship; fraud through misrepresentation and/or suppression; unjust enrichment; and negligent hiring, training, supervision and retention (Doc. 1, ¶¶ 22-57)—states that this Court has diversity jurisdiction pursuant to 28 U.S.C. § 1332(a) (id., ¶ 6). The motion to dismiss both attacks that assertion "on the basis that the amount-in-controversy clearly does not exceed $75,000" (Doc. 6 at 1; 4-7), and contends that the plaintiffs have failed to state a claim upon which relief may be granted because their "state-law tort claims are preempted by federal law," namely section 14501(c) of the Interstate Commerce Commission Termination Act of 1995 (the "ICCTA") (id. at 1; 7-11). Shortly after the defendant filed its motion to dismiss, on July 8, 2011, the plaintiffs filed their "First Amendment to Complaint" (Doc. 8),⁴ on July 13, 2011, which adds the following paragraph (no. 8) under "Parties and Jurisdiction":

This Court has subject matter jurisdiction on the basis of "Federal Question" jurisdiction, specifically application of the United States Transportation Code⁵ and Interstate Commerce Commission Termination Act ("ICCTA").

(Doc. 8, ¶ 8 (footnote added).)

The plaintiffs' opposition to the motion to dismiss, interestingly, both states that this Court "has 'Federal Question' jurisdiction as concerns whether or not Federal law allows Plaintiffs to protect themselves from the behaviors of the Defendant as alleged in this case under Plaintiffs['] ancillary state law claims" (Doc. 14 at 4), but provides that "[b]ecause the 'ICCTA' preemption section does not apply to non consent tows like this case, Plaintiffs' ancillary state laws [sic] claims should be allowed to proceed" (id.). The defendant's reply, on the other hand, concludes that "[b]ecause Plaintiffs have pled state-law tort claims preempted by § 14501(c), relief cannot be granted upon those claims" (Doc. 17 at 5).Discussion

The Court must first determine whether it has subject matter jurisdiction over this lawsuit. The plaintiffs have alleged that the Court has "subject matter jurisdiction on the basis of 'Federal Question' jurisdiction," through the "application of [federal law.]" (Doc. 8, ¶ 8 (emphasis added).) But they have neither shown that the claims they set forth "aris[e] under the Constitution, laws, or treatise of the United States," 28 U.S.C. § 1331, nor have they alleged—nor, as the Court will explain, can they allege—that either the "United States Transportation Code" or the ICCTA are part of a select group of federal laws that "so forcibly and completely displace[] state law that [a] plaintiff's cause of action is either wholly federal or nothing at all," which thus converts "what otherwise appear[ to be] merely [ ] state law claim[s into] claim[s] 'arising under' federal law for jurisdictional purposes." Elam v. Kansas City Southern Ry. Co., 635 F.3d 796, 803-04 (5th Cir. 2011) (quoting New Orleans & Gulf Coast Ry. Co. v. Barrois, 533 F.3d 321, 330 (5th Cir. 2008)). Moreover, the plaintiffs' assertion of federal question jurisdiction does not comport with their argument that the preemption section of the ICCTA—49 U.S.C. § 14501(c)—"does not apply to [the facts of] this case," and thus, their state law claim "should be allowed to proceed." (Doc. 14 at 4.) Simply put, claiming that, on the one hand, the claims you assert "arise under," or are completely preempted by, federal law—as they must for this court to have federal question jurisdiction over them—and then, on the other hand, arguing that those same claims are not defensively preempted by federal law is, at best, illogical.

Also, for the reasons set forth below, the plaintiffs have failed to allege that this matter exceeds the minimum jurisdictional amount required by 28 U.S.C. § 1332.

1. Federal Question Jurisdiction.

The jurisdictional facts of this case are unique. First, the plaintiffs chose to file their complaint in federal court, originally only invoking jurisdiction pursuant to 28 U.S.C. § 1332 (see Doc. 1, ¶ 6), and have asserted only state law claims.⁶ In "response" tothe defendant's motion to dismiss, which in part attacked the plaintiffs' ability to meet the minimum amount in controversy to invoke jurisdiction under section 1332, they amended their complaint to allege "'Federal Question' jurisdiction." Since the plaintiffs have not alleged a violation of federal law, to achieve the federal question jurisdiction they seek, they must rely on the so-called doctrine of complete preemption, or super preemption,⁷ the nameof which "is a misnomer because it is not a preemption doctrine but, rather, a federal jurisdiction doctrine." City of Rockford v. Raymond, No. 98 C 50353, 1999 WL 218549, at *1 n.1 (N.D. Ill Apr. 14, 1999) (citing Jass v. Prudential Health Care Plan, Inc., 88 F.3d 1482, 1486-87 (7th Cir. 1996)); see also Fayard v. Northeast Vehicle Servs., LLC, 533 F.3d 42, 44 (1st Cir. 2008) ("Complete preemption is a short-hand for the doctrine that in certain matters Congress so strongly intended an exclusive federal cause of action that what a plaintiff calls a state law claim is to be recharacterized as a federal claim. A federal claim, of course, falls within the district court's federal question jurisdiction, 28 U.S.C. § 1331.") (citations omitted).

While both sides have focused on "whether 49 U.S.C. § 14501(c) preempts [the asserted] state law claims, neither addresses the issue in the context of [this Court's jurisdiction over those claims, through complete preemption]." Id. at *2. The Northern District of Illinois, in City of Rockford, and the First Circuit, in Fayard, however, both dealt specifically with whether the state law claims at issue in those cases were completely preempted under the ICCTA, such that the federal court had jurisdiction over those claims pursuant tosection 1331. And both courts drew an analogy to preemption pursuant to ERISA's section 502(a).⁸ In Fayard, the court of appeals first noted that

while some state law claims may be completely preempted under the ICCTA, the question before us is whether the ICCTA automatically immunizes railroads from state nuisance claims. It does not, nor does it clearly provide a federal cause of action amounting to nuisance. Certainly nothing in the ICCTA provides for nuisance the clear-cut federal cause of action available to ERISA benefit claimants or those who seek to enforce labor contracts.

533 F.3d at 48. In City of Rockford, the court held that

section 14501(c) . . . does not evidence a Congressional intent to transfer jurisdiction over all preemption claims arising thereunder from state to federal courts. The language of [that section] more closely mirrors ERISA's section 514(a) and contains no detailed, comprehensive civil enforcement scheme providing exclusive federal remedies such as that found in ERISA's section 502(a).

1999 WL 218549, at *2

Moreover, unlike ERISA's implementation, pursuant to section 514(a), of a comprehensive civil enforcement scheme, the ICCTA "was passed in 1995 to advance deregulation of the rail and motor carrier industries." Central Transport Int'l v. SterlingSeating, Inc., 356 F. Supp. 2d 786, 788 (E.D. Mich. 2005) (citing Fitzpatrick v. Morgan Southern, Inc., 261 F. Supp. 2d 978, 982 (W.D. Tenn. 2003)) (emphasis in original). Central Transport — an action on account, breach of contract, and quantum meruit arising from the defendants alleged failure to pay the full amount claimed for freight transportation services — is instructive. See id. at 787. There, the court, sua sponte, ordered the defendant to show cause why the case, removed to federal court on the basis of federal question jurisdiction pursuant to sections 1331 and 1337(a),⁹ should not be remanded to state court for lack of subject...