Kuehne v. United Parcel Service, Inc.

• Decision Date: 27 June 2007
• Docket Number: No. 82A04-0607-CV-381.,82A04-0607-CV-381.
• Parties: Pam KUEHNE and Larry Kuehne, Appellants-Plaintiffs, v. UNITED PARCEL SERVICE, INC., Appellee-Defendant.
• Court: Indiana Appellate Court

868 N.E.2d 870

Pam KUEHNE and Larry Kuehne, Appellants-Plaintiffs, v. UNITED PARCEL SERVICE, INC., Appellee-Defendant.

No. 82A04-0607-CV-381.

Court of Appeals of Indiana.

June 27, 2007.

Terry A. White, Olsen, White & Hambidge, Evansville, IN, Attorney for Appellants.

D. Bryce Zoeller, Eric D. Johnson, Kightlinger & Gray, LLP, Indianapolis, IN, Attorneys for Appellee.

OPINION

BAKER, Chief Judge.

In this case, we are asked to resolve an issue of first impression in Indiana. Appellants-plaintiffs Pam and Larry Kuehne (collectively, the Kuehnes) appeal the grant of summary judgment in favor of appellee-defendant United Parcel Service, Inc. (UPS), regarding their claim against UPS for negligence after Pam tripped over a package that a UPS driver left on the Kuehnes' doorstep. Specifically, the Kuehnes argue that the trial court erred in determining that their claims against UPS were preempted by federal law. In response, UPS argues that the Kuehnes' claims are preempted because "Congress has barred the application of state laws to determine how UPS provides its services." Appellee's Br. p. 2. Concluding that the Kuehnes' claims against UPS are not preempted by federal law, we hold that summary judgment was improperly entered for UPS. Thus, we reverse the judgment of the trial court and remand this cause for trial.

FACTS

The undisputed facts are that on September 21, 2000, UPS delivered a paraffin home spa that Pam had ordered to the Kuehnes' Evansville residence. The UPS driver placed the package on the front step of the Kuehnes' home. As Pam was leaving the house, she tripped on the package, which caused her to fall and sustain injuries. As a result, the Kuehnes filed a complaint against UPS on August 29, 2002, alleging that the UPS driver negligently placed the package on the steps and that UPS's negligence was the proximate cause of Pam's injuries. Larry also advanced a claim for loss of consortium.

On December 20, 2005, UPS filed a motion for summary judgment, asserting that the trial court was without subject matter jurisdiction over the case. Hence, UPS claimed that the Kuehnes' action should be dismissed. More specifically, UPS argued that the Kuehnes' claims were preempted by the Federal Aviation Administration Authorization Act of 1994¹ (FAAAA) and the Carmack Amendment to the Interstate Commerce Act.² UPS claimed that the controlling statutes precluded the enactment or enforcement of state laws that related to the "price, route, or service" of motor carriers and ground/air carriers such as UPS. Appellants' App. p. 15. Moreover, UPS argues that the Carmack Amendment exclusively governs a carrier's liability and shippers' remedies that arise from contracts regarding the interstate shipment of property.

Following a hearing on the motion for summary judgment that commenced on May 23, 2006, the trial court granted UPS's motion. The trial court determined that the Kuehnes' claim against UPS was "inherently a claim against [UPS's] services, which is preempted under the FAAAA." Id. at 11. As a result, the trial court ruled that "summary judgment is entered in favor of [UPS], or in the alternative, [the Kuehnes'] complaint is dismissed under Trial Rule 12." Id. The Kuehnes now appeal.

I. Standard of Review

Summary judgment is appropriate only when there are no genuine issues of material fact and the moving party is entitled to a judgment as a matter of law. Ind. Trial Rule 56(C). In reviewing a trial court's ruling on summary judgment, this court stands in the shoes of the trial court, applying the same standards in deciding whether to affirm or reverse summary judgment. AutoXchange.com, Inc. v. Dreyer and Reinbold, Inc., 816 N.E.2d 40, 47 (Ind.Ct.App.2004). Thus, on appeal, we must determine whether there is a genuine issue of material fact and whether the trial court has correctly applied the law. Id. In doing so, we consider all of the designated evidence in the light most favorable to the non-moving party. Id. The party appealing the grant of summary judgment has the burden of persuading this court that the trial court's ruling was improper. Id. Accordingly, the grant of summary judgment must be reversed if the record discloses an incorrect application of the law to the facts. Ayres v. Indian Heights Volunteer Fire Dep't, Inc., 493 N.E.2d 1229, 1234 (Ind.1986).

II. The Kuehnes' Claims

In addressing the Kuehnes' argument that summary judgment was improperly granted for UPS, we initially observe that under the Supremacy Clause of the United States Constitution, federal law is the supreme law of the land. U.S. Const. art. VI, cl. 2; Bondex Int'l v. Ott, 774 N.E.2d 82, 85 (Ind.Ct.App.2002). The preemption doctrine invalidates those state laws that interfere with or are contrary to federal law. Comty. Action Program of Evansville v. Veeck, 756 N.E.2d 1079, 1084 (Ind.Ct.App.2001). By the same token, a cardinal rule of preemption analysis is the "starting presumption that Congress d[id] not intend to supplant state law." New York State Conf. of Blue Cross & Blue Shield Plans v. Travelers Ins. Co., 514 U.S. 645, 654, 115 S.Ct. 1671, 131 L.Ed.2d 695 (1995). Moreover, the presumption against preemption takes on added significance "where federal law is said to bar state action in fields of traditional state regulation." Id. at 655, 115 S.Ct. 1671. Accordingly the historic police powers of the States are not to be superseded by a Federal Act "unless that was the clear and manifest purpose of Congress." Micronet, Inc. v. Ind. Util. Regulatory Comm'n, 866 N.E.2d 278, 285 (2007).

We note that three variations of federal preemption doctrine exist: (1) express preemption, occurring when a statute expressly defines the scope of its preemptive effect; (2) field preemption, occurring when a pervasive scheme of federal regulation makes it reasonable to infer that Congress intended exclusive federal regulation of the area; and (3) conflict preemption, occurring either where it is impossible to comply with both federal and state or local law, or where state law stands as an obstacle to the accomplishment and execution of federal purposes and objectives. Id. Put another way, congressional intent to preempt state law can be found in the explicit language of a statute, implied from the existence of a comprehensive regulatory scheme, or inferred when the state law in question directly conflicts with a federal law or stands as an obstacle to achievement of federal objectives. Silkwood v. Kerr-McGee Corp., 464 U.S. 238, 248, 104 S.Ct. 615, 78 L.Ed.2d 443 (1984). As we recently observed in Micronet, "[t]he question, at bottom, is one of statutory intent, and we accordingly begin with the language employed by Congress and the assumption that the ordinary meaning of that language accurately expresses the legislative purpose." 866 N.E.2d at 288 (quoting Morales v. Trans World Airlines, Inc., 504 U.S. 374, 383, 112 S.Ct. 2031, 119 L.Ed.2d 157 (1992)).

Turning to the relevant provisions of the FAAAA:

[A] State, political subdivision of a State, or political authority of 2 or more States may not enact or enforce a law, regulation, or other provision having the force and effect of law related to a price, route, or service of any motor carrier ... or any motor private carrier, broker, or freight forwarder with respect to the transportation of property.

49 U.S.C. § 14501(c)(1) (emphasis added).

In drafting the FAAAA preemption provisions, Congress adopted "the broad preemption interpretation adopted by the United States Supreme Court in Morales v. Trans World Airlines." H.R. Conf. Rep. No. 103-677, at 83 (1994), U.S.Code Cong. & Admin.News 1994, 1715, 1755. In Morales, it was determined that the Airline Deregulation Act of 1978(ADA), which is currently codified at 49 U.S.C. section 41713(b)(1)-(3) and has language virtually identical to that in section 14501(c)(1) quoted above, preempted all state actions having "a connection with or reference to ... rate, routes, or services." Morales, 504 U.S. at 384, 112 S.Ct. 2031. The preemptive statutes are interpreted broadly and expansively. Id.; see also Travel All Over the World v. Saudi Arabia, 73 F.3d 1423, 1430 (7th Cir.1996) (affirming the view taken in Morales that state enforcement actions having a connection with or reference to airline rates, routes, or services are preempted). In the context of passenger airline services, courts have recognized that "Congress did not intend to displace or foreclose all tort actions arising under state law." Somes v. United Airlines, Inc., 33 F.Supp.2d 78, 84 (D.Mass.1999). However, it has been determined that matters relating to "prices, schedules, origins, destinations or the point-to-point transportation of passengers, cargo or mail" are preempted. Id. at 83.

Through the years, courts in various jurisdictions³ have held that claims based on the negligent services or prices of a carrier such as UPS fall within the broad scope of FAAAA preemption. Where no Indiana cases adequately address the issues involved in a case, decisions of other jurisdictions may be instructive. See Associated Truck Lines, Inc. v. Pub. Serv. Comm'n of Ind., 492 N.E.2d 704, 713 (Ind. Ct.App.1986) (explaining that where no Indiana case law is on point our courts have looked to federal cases as persuasive authority). Moreover, we acknowledge that unpublished decisions issued by federal district courts do not constitute binding precedent upon this court. Wood v. Schuen, 760 N.E.2d 651, 659 (Ind.Ct.App. 2001). However, unpublished cases may be deemed worthy of mentioning when a similar issue is presented to us and there is a dearth of other authority on point. See id.

In Rockwell v. United Parcel Serv., Inc., No. 2:99 CV 57, 1999 WL 33100089 (D.Vt. 1999), the plaintiff sought to impose liability on UPS for negligently delivering a package that contained a pipe bomb. The plaintiff asserted that UPS was negligent in its intake and delivery protocol by failing to have an...