Jvc Americas Corp. v. Csx Intermodal Inc.

• Decision Date: 11 June 2003
• Docket Number: No. 02-CV-3192.,02-CV-3192.
• Citation: 292 F.Supp.2d 586
• Parties: JVC AMERICAS CORP. Plaintiff, v. CSX INTERMODAL INC. and MEDITERRANEAN SHIPPING COMPANY S.A., Defendants.
• Court: U.S. District Court — District of New Jersey

292 F.Supp.2d 586

JVC AMERICAS CORP. Plaintiff, v. CSX INTERMODAL INC. and MEDITERRANEAN SHIPPING COMPANY S.A., Defendants.

No. 02-CV-3192.

United States District Court, D. New Jersey.

June 11, 2003.

COPYRIGHT MATERIAL OMITTED

John T. Lillis, Jr., Kennedy Lillis Schmidt & English, Newark, NJ, for plaintiff.

Richard Brett Kelly, De Orchis, Walker & Corsa, LLP, Union, NJ, for defendants.

ORDER

GREENAWAY, District J.

This matter having come before the Court on Defendants', CSX Intermodal, Inc. and Mediterranean Shipping Company S.A. (collectively "Defendants"), objection to Magistrate Judge G. Donald Haneke's March 28, 2003 Report and Recommendation, pursuant to Fed. R.Civ.P. 72(b) and L. Civ. R. 72.1(a)(2), wherein he recommended that this Court grant Plaintiff's motion to remand; and it appearing that a Magistrate Judge's recommended disposition of a dispositive motion, such as a motion to remand, is subject to de novo review. In re U.S. Healthcare, 159 F.3d 142, 145-46 (3d Cir.1998); Temptations, Inc. v. Wager, 26 F.Supp.2d 740, 743 (D.N.J.1998); see also Fed.R.Civ.P. 72(b); and this Court having reviewed the parties' submissions under the appropriate de novo standard; and good cause appearing,

IT IS on this 11th day of June 2003,

ORDERED that Magistrate Judge Haneke's Report and Recommendation is adopted as the Opinion of this Court;

IT IS FURTHER ORDERED that Plaintiff's motion to remand is GRANTED; and

IT IS FURTHER ORDERED that a copy of this Order be served on all parties within seven (7) days of the date of this Order.

REPORT AND RECOMMENDATION

This matter is before the Court on a motion by the Plaintiff to remand this action to the Superior Court of New Jersey, Law Division, Hudson County. Defendants oppose this motion. This matter has been referred to me by the Honorable Joseph A. Greenaway, Jr. for an appropriate Report and Recommendation pursuant to Loc. Civ. R. 72.1(a)(2) and Fed.R.Civ.P. 72(b). In preparing this Report, I have read and considered all papers submitted by the parties and for the following reasons I respectfully recommend that the Plaintiff's Motion to Remand be Granted.

BACKGROUND

A. Procedural Background

Plaintiff, JVC Americas Corporation ("JVC"), filed this Complaint in the Superior Court of New Jersey, Hudson County, on April 15, 2002 against Defendants CSX Intermodal, Inc. ("CSXI") and Mediterranean Shipping Company S.A. ("MSC"). In the four count Complaint, Plaintiff alleges that JVC's container, No. MSCU 426172-9 which held 967 cartons of electronics, disappeared while at CSXI's terminal in South Kearny, New Jersey. Plaintiff asserts claims against CSXI for conversion, breach of bailment, and negligence. Plaintiff also states a claim against MSC based on breach of contract.¹

Defendants filed a Notice of Removal on July 2, 2002 alleging that removal of the action was warranted based on §§ 1331 and/or 1333 and Plaintiff's claims against Defendants pursuant to 46 U.S.C. §§ 1300-1315 the United States Carriage of Goods By Sea Act ("COGSA"), and/or under the federal common law of the United States as it applies to international and interstate carriers and transportation.

B. General Background

Plaintiff's action arises from the disappearance of a cargo shipment of its electronic goods, namely, JVC electronics. Plaintiff explains that the shipment of electronics was delivered to MSC in Yokohoma, Japan for transportation to Pine Brook, New Jersey. Plaintiff states that on November 25, 2001, MSC issued a bill of lading MSCUJY14876 in Yokohama, Japan listing the Victor Company of Japan, Ltd., as the shipper and listing the consignee as JVC. Plaintiff also states that the bill of lading further identifies Tokyo, Japan as the port of loading and the MSC Alabama as the vessel responsible for transporting three containers.² Plaintiff further states that the port of discharge was identified as Los Angeles but the final destination was Pine Brook, New Jersey.³

Plaintiff claims that on December 1, 2001 the three containers arrived in Los Angeles. Plaintiff asserts that after arriving in Los Angeles, the containers were transported across the country via rail and arrived at the CSXI terminal in South Kearny, New Jersey on December 11, 2001. Prior to the containers reaching the CSXI terminal, however, Plaintiff argues that container MSCU-426172-9 was broken into and approximately 30 cases of cargo were either removed or stolen. Plaintiff states that once the containers arrived at CSXI, an exception report was prepared regarding the lost container and cargo.

On December 17, 2001 Plaintiff's truck arrived at CSXI to pick up MSCU-426172-9 but it could not be located. Plaintiff asserts that the next day the container was found abandoned and emptied on Routes 1 & 9 in Newark, New Jersey by the Newark Police Department.

Defendants admit that the first three counts of the Complaint (conversion, breach of bailment, and negligence) are state law claims. However, Defendants assert that Plaintiff's fourth claim is a federal claim against MSC. In the fourth count, Plaintiff alleges that "MSC should be liable as a common carrier by sea which failed to make proper delivery of the Shipment at its final destination." Defendants assert that Plaintiff's fourth count falls under either the Harter Act, 46 U.S.C.App. §§ 190-96, or the Carriage of Goods by Sea Act, 46 U.S.C.App. §§ 1300-15 ("COGSA"). Defendants therefore claim that this Court has original federal jurisdiction under § 1331 and original jurisdiction over admiralty and maritime claims under § 1333. Defendants further assert that this Court has jurisdiction over claims "arising under any Act of Congress regulating commerce." 28 U.S.C. § 1337(a). Defendants also claim that their Notice of Removal was timely filed on July 2, 2002 but assert that Plaintiff's Motion to Remand was untimely as it was filed on August 12, 2002, more than thirty days later.

Applicable Law

Pursuant to 28 U.S.C. § 1441(a), "any civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants, to the district court of the United States for the district and division embracing the place where such action is pending." Id.

Furthermore, 28 U.S.C. § 1441(b) provides, "any civil action of which the district courts have original jurisdiction founded on a claim or right arising under the Constitution ... shall be removable without regard to the citizenship or residence of the parties." Id.

If an action was improperly removed due to lack of federal jurisdiction, then the matter may be remanded to state court pursuant to 28 U.S.C. § 1447. Under § 1447, "[a] motion to remand ... on the basis of any defect other than lack of subject matter jurisdiction must be made within 30 days after the filing of the notice of removal." 28 U.S.C. § 1447(c).

In this case, Plaintiff's motion is timely because an objection to this Court's subject matter jurisdiction is allowable at any time. Plaintiff claims that there is a jurisdictional defect in the removal of this case, and not merely a procedural defect, because Plaintiff argues that this case could not have initially been filed in federal court.

In reviewing a motion to remand "the Court must construe the removal statutes strictly and resolve all doubts in favor of remand." Teamsters Union Local 102, et al v. Anheuser Busch, Inc. and John Listinsky, No. 99-1044, slip op. at 3 (D.N.J. April 28, 1999). In other words, on a motion to remand, the removing party bears the burden of establishing that federal jurisdiction exists and that the case should not be remanded. See also Diaz v. Sheppard, 85 F.3d 1502 (11th Cir.1996).

ANALYSIS

Defendants have incorrectly asserted that this case was properly removed based upon this Court's admiralty jurisdiction, pursuant to 28 U.S.C. § 1333, and this Court's federal question jurisdiction, pursuant to 28 U.S.C. § 1331.

28 U.S.C. § 1333—Admiralty, maritime and prize cases

Section 1333 states in relevant part that:

The district courts shall have original jurisdiction, exclusive of the courts of the States, of: (1) Any civil case of admiralty or maritime jurisdiction, saving to suitors in all cases all other remedies to which they are otherwise entitled.

28 U.S.C. § 1333.

The Court of Appeals for the Third Circuit has explained that "an admiralty case filed in state court may only be removed if there exists some independent basis for federal jurisdiction...." U.S. Express Lines, Ltd. v. Higgins, 281 F.3d 383, 390 (3d Cir.2002)(citing Romero v. Int'l. Terminal Operating Co., 358 U.S. 354, 380-81, 79 S.Ct. 468, 3 L.Ed.2d 368 (1959)). Therefore, in order for Defendants to properly remove this case based on this Court's admiralty jurisdiction, pursuant to 28 U.S.C. § 1333, they must show an independent basis for federal jurisdiction, which they have failed to do. Defendants argue: 1) that Plaintiff waived its right to object to removal; and 2) that "this case is governed by COGSA and/or the Harter Act; it therefore could have been filed within this Court's original admiralty and maritime jurisdiction." As discussed above, Plaintiff's motion to remand is timely and as will be discussed below, COGSA and/or the Harter Act⁴ do not provide an adequate basis for removal. Therefore, I do not believe that Defendants have provided the necessary independent basis for federal jurisdiction.

Defendants also present an unpersuasive argument that this Court can exercise general admiralty or maritime jurisdiction over this case. In Berkshire Fashions, Inc. v. M. V. Hakusan II, 954 F.2d 874, 881 (3d Cir.1992), the Court stated that "lower courts should look to the subject matter of the agency contract and determine whether the services performed under the contract are maritime in nature." Id. at 880 (quoting Exxon Corp. v. Central Gulf Lines, Inc., 500 U.S. 603, 111 S.Ct. 2071, 114 L.Ed.2d 649 (1991)).

The B...