Eagle Transp., LLC v. Scott, CIVIL ACTION NO. 2:11-CV-96-KS-MTP

• Decision Date: 14 May 2012
• Docket Number: CIVIL ACTION NO. 2:11-CV-96-KS-MTP
• Parties: EAGLE TRANSPORTATION, LLC PLAINTIFF v. WILLIE SCOTT, et al. DEFENDANTS
• Court: U.S. District Court — Southern District of Mississippi

EAGLE TRANSPORTATION, LLC PLAINTIFF

v.WILLIE SCOTT, et al. DEFENDANTS

CIVIL ACTION NO. 2:11-CV-96-KS-MTP

UNITED STATES DISTRICT COURT FOR THE SOUTHERN DISTRICT OF MISSISSIPPI HATTIESBURG DIVISION

Dated: May 14, 2012

MEMORANDUM OPINION AND ORDER

For the reasons stated below, the Court grants in part and denies in part Defendant Great American Insurance Company's Motion for Summary Judgment [37] and denies Plaintiff's Motion for Partial Summary Judgment [40].

I. BACKGROUND

Plaintiff holds itself out as a broker of motor transportation services. On November 18, 2008, Plaintiff and Defendant Willie Scott, doing business as Scotty's Trucking (hereinafter referred to collectively as "Scott"), executed a Motor Carrier Agreement. According to the contract, Scott agreed to transport and deliver specific commodities according to Plaintiff's instructions, on behalf of the commodities' owners (the "shippers"). The contract also required Scott to perform his services in a good and workmanlike manner, in accordance with the highest standards of the trade. Scott agreed to indemnify, defend, release, and hold Plaintiff and the shippers harmless "from and against all liability, costs and expense for loss or damage to property and/or injury to or deaths of persons (including, but not limited to, the property and employees of each party [to the contract]) when arising or resulting, directly or indirectly, fromany" of his acts or omissions "associated with or arising out of" the contract. The contract provided that Scott shall be liable to Plaintiff, to the extent of its interest, and to the shippers "for loss or damage to any property transported" under the contract "as set forth under 49 U.S.C. § 14706." The contract defined Scott's liability as "the full value of the damaged or lost item(s)."

Around August 7, 2009, Peco Foods, Inc. ("Peco") hired Plaintiff to transport a truckload of frozen chicken from Sebastopol, Mississippi, to Wixom, Michigan. Plaintiff then hired Scott to transport the chicken. Around August 9, 2009 - during transit -most of the cargo was damaged beyond salvage. Shortly thereafter, Defendant Great American Insurance Company ("Great American"), Scott's insurer, seized what was left of the cargo and sold it for salvage value.

Plaintiff subsequently filed a claim with Great American, requesting payment for the cargo transported by Scott. Plaintiff reimbursed its client, Peco, for the lost cargo. On July 28, 2010, Great American denied Plaintiff's claim, and issued Plaintiff a check for $2,056.25 - an amount representing the salvage value (after expenses) of the remaining cargo.

Plaintiff filed the present action in the County Court of Lamar County, Mississippi, on March 11, 2011, alleging state law claims of breach of contract and negligence against Great American, and seeking a declaratory judgment as to Great American's obligations under Scott's policy. Great American removed the case on April 25, 2011, and then answered the Complaint. It asserted a counterclaim and crossclaim for a declaratory judgment that it has no obligation under the policy to make anypayment to Plaintiff or Scott.

On May 4, 2012, Plaintiff filed a Motion to Remand [5], but the Court denied it, finding that Plaintiff's negligence claim against Scott was preempted by the Carmack Amendment.¹ Eagle Transp., LLC v. Scott, No. 2:11-CV-96-KS-MTP, 2011 U.S. Dist. LEXIS 60958, at *13 (S.D. Miss. June 7, 2011). Plaintiff subsequently filed an Amended Complaint [22], in which it asserted the same claims against Great American, in addition to a Carmack Amendment claim and breach of contract claim against Scott.

On January 25, 2012, Great American filed a Motion for Summary Judgment [37], in which it seeks a declaratory judgment that Plaintiff has no standing to recover benefits under Scott's policy. Great American also seeks a declaratory judgment that it was entitled to rescind the policy and deny any claim for the subject loss. Finally, Great American seeks summary judgment as to Plaintiff's negligence claim.

On January 30, 2012, Plaintiff filed its own Motion for Partial Summary Judgment [40], in which it seeks a declaratory judgment that the Scott's policy was effective on the date of the subject loss. Plaintiff also filed a Motion for Partial Summary Judgment [42] as to its claims against Scott.

On April 13, 2012, the Court granted in part and denied in part Plaintiff's Motion for Partial Summary Judgment as to Scott. Eagle Transp., LLC v. Scott, 2012 U.S. Dist. LEXIS 52107 (S.D. Miss. Apr. 13, 2012). The Court granted the motion asto the Carmack Amendment claim, but the Court denied the motion as to the breach of contract claim. The Court entered a judgment in favor of Plaintiff against Defendants Willie Scott and Willie Scott d/b/a Scotty's Trucking in the principal amount of $49,808.19, plus pre-judgment interest and post-judgment interest.

The Court now considers the remaining dispositive motions, but it must first address its retention of jurisdiction over this matter.

II. PENDENT JURISDICTION

"Courts are instructed to examine their jurisdiction at every stage of the litigation." Enochs v. Lampasas Cnty., 641 F.3d 155, 161 (5th Cir. 2011) (punctuation omitted). As noted in the Court's previous order [13], the Court had jurisdiction over this because it included a "claim arising under the Constitution, laws, or treaties of the United States." Eagle Transp., LLC, 2011 U.S. Dist. LEXIS 60958 at *5 (quoting 28 U.S.C. § 1331). Although Plaintiff did not plead a federal claim, the Court held that its negligence claim against Scott was completely preempted by the Carmack Amendment. Id. at *14. Although the Court did not address the issue in its previous opinion, supplemental jurisdiction over Plaintiff's remaining state law claims was appropriate, as they "form[ed] part of the same case or controversy" as the Carmack Amendment claim, 28 U.S.C. § 1367(a), or, phrased differently, they "derive[d] from a common nucleus of operative fact." United Mine Workers of Am. v. Gibbs, 383 U.S. 715, 725, 86 S. Ct. 1130, 16 L. Ed. 2d 218 (1966).

Of course, the Court granted Plaintiff's Motion for Summary Judgment as to its Carmack Amendment claim against Defendant Scott, disposing of the federal question.Eagle Transp., LLC, 2012 U.S. Dist. LEXIS 52107 at *13. The Court may now either retain jurisdiction of the remaining state law claims or remand them to the state court. Mendoza v. Murphy, 532 F.3d 342, 346 (5th Cir. 2008). Addressing this issue, the Fifth Circuit recently held:

Our general rule is to dismiss state claims when the federal claims to which they are pendent are dismissed. Indeed, the Supreme Court has for nearly half a century cautioned federal courts to avoid needless decisions of state law . . . .

We recognize that the doctrine of pendent jurisdiction is a doctrine of flexibility. A district court has wide discretion in deciding whether it should retain jurisdiction over state law claims once all federal claims have been eliminated. Thus, we are right to hesitate in rejecting the district court's exercise of its discretionary authority, as the general rule of remanding state law claims to state court after all federal claims have been eliminated is neither mandatory nor absolute. But such discretion is founded upon and guided by a court's consideration of the prescribed statutory and common law factors.

Enochs, 641 F.3d at 161-62.

When deciding whether to exercise pendent jurisdiction over a state law claim, the Court must consider the following statutory factors:

(1) the claim raises a novel or complex issue of State law,

(2) the claim substantially predominates over the claim or claims over which the district court has original jurisdiction,

(3) the district court has dismissed all claims over which it has original jurisdiction, [and]

(4) in exceptional circumstances, there are other compelling reasons for declining jurisdiction.

28 U.S.C. § 1367(c). The Court also considers the common law factors of "judicial economy, convenience, fairness, and comity." Mendoza, 532 F.3d at 346. "[I]n the usualcase in which all federal-law claims are eliminated before trial, the balance of factors to be considered under the pendent jurisdiction doctrine . . . will point toward declining to exercise jurisdiction over the remaining state-law claims." Parker & Parsley Petroleum Co. v. Dresser Indus., 972 F.2d 580, 586-87 (5th Cir. 1992) (punctuation omitted). No single factor is determinative, though; the Court looks to the specific circumstances of each case. Id. at 587.

There are no novel or complex questions of state law involved in this case, and there are likewise no exceptional circumstances compelling remand. See 28 U.S.C. § 1367(c)(1), (4). The Court has, however, dismissed all of the claims over which it had original jurisdiction, and state law claims now predominate this case. See 28 U.S.C. § 1367(c)(2)-(3). Therefore, the statutory factors are evenly split.

Comity interests weigh in favor of remand, as the Court should avoid needless decisions of state law. Parker & Parsley, 972 F.2d at 585. However, Alabama law applies to the substantive issues of this case, and a remand would send the case to a Mississippi court that is no better equipped to address those issues than this Court. Therefore, the comity concerns are slightly less important here than they would typically be.

The common law factors of economy, convenience, and fairness weigh in favor of retaining the case. The remaining issues in the case are ripe for summary disposition, which weighs in favor of retaining jurisdiction. Mendoza, 532 F.3d at 346-47. Also, the case is only two months away from trial, and this Court has substantial familiarity with it. Id. at 347. Moving forward in this Court would "prevent redundancyand conserve scarce judicial resources." Id.²

After considering the statutory and common law factors impacting the exercise of pendent jurisdiction, the Court concludes that it...