Louis M. Marson Jr., Inc. v. Alliance Shippers, Inc.

• Decision Date: 10 February 2020
• Docket Number: CIVIL ACTION NO. 19-1330
• Citation: 438 F.Supp.3d 326
• Parties: LOUIS M. MARSON JR., INC., d/b/a Greenwood Mushrooms v. ALLIANCE SHIPPERS, INC.
• Court: U.S. District Court — Eastern District of Pennsylvania

438 F.Supp.3d 326

LOUIS M. MARSON JR., INC., d/b/a Greenwood Mushrooms

v.ALLIANCE SHIPPERS, INC.

CIVIL ACTION NO. 19-1330

United States District Court, E.D. Pennsylvania.

Filed February 10, 2020

John V. Rafferty, Gawthrop Greenwood, P.C., West Chester, PA, for Louis M. Marson Jr., Inc.

Frank C. Botta, The Lynch Law Group LLC, Cranberry Township, PA, for Alliance Shippers, Inc.

MEMORANDUM

Padova, J. Plaintiff brings this action pursuant to the Carmack Amendment, 49 U.S.C. § 14706, and state law to recover losses it incurred as a result of the delayed delivery of a shipment of mushrooms from its location in Kennett Square, Pennsylvania to several locations around Atlanta, Georgia. Defendant has moved for summary judgment as to all of Plaintiff's claims. For the following reasons, we grant the Motion in part and deny it in part.

I. FACTUAL BACKGROUND

On Tuesday, July 17, 2018, Plaintiff texted Alan Sweis, a Logistics Account Executive for Defendant, and asked him whether Defendant could cover Plaintiff's Atlanta, Georgia run during the coming weekend. (Pl.'s Ex. B at 8; Sweis Aff. (Def.'s Mem. Ex. 1) ¶ 2.) "Sweis confirmed that Alliance would be able to deliver that run." (Pl.'s Ex. B at 8.) On the morning of Friday, July 20, 2018, Plaintiff emailed Sweis and told him that Plaintiff "will need you to do the normal Saturday run tomorrow." (Pl.'s Exs. D, E; Sweis Aff. ¶¶ 2, 11.) " ‘The normal Saturday run’ included transportation of goods from Plaintiff to various locations within the State of Georgia." (Sweis Aff. ¶ 13.) Sweis had arranged "the normal Saturday run" for Plaintiff approximately thirteen times prior to July 20, 2018. (Id. ) Sweis was not able to complete arrangements for the July 21, 2018 shipment on the 20th, so he texted Matt Marson, a representative of Plaintiff, to let him know that he would "be up tomorrow at 5 to work on it." (Def.'s Reply Ex. 1.) On July 21, 2018, Defendant entered into an agreement with KG's South East Trucking LLC ("KG's") to transport Plaintiff's shipment of mushrooms to Georgia. (Sweis Aff. ¶ 17; Def.'s Mem. Ex. 2.) Plaintiff's shipment was supposed to be delivered to three locations in the Atlanta area on Sunday, July 22, 2018 and three additional locations in the Atlanta area on Monday, July 23, 2018. (Pl.'s Ex. E.) However, the shipment was delayed because the truck broke down and the original driver abandoned the load. (Pl.'s Exs. J, M; Sweis Aff. ¶ 26.) A new driver picked up the trailer on Tuesday, July 24, 2018 and attempted to deliver the mushrooms to Plaintiff's customers. (Pl.'s Exs. H, N; Sweis Aff. ¶ 26.) However, the customers rejected delivery; one customer explained that the mushrooms were "2 days late with a 4 day shelf life" and were "starting to go bad in some areas." (Pl.'s Ex. N; Sweis Aff. ¶ 27.)

The Complaint alleges one claim against Defendant under the Carmack Amendment, 49 U.S.C. § 14706 (Count I) and, in the alternative, two claims under Pennsylvania law, a claim for breach of contract under Pennsylvania common law (Count II) and a claim for violation of the Pennsylvania Unfair Trade Practices and Consumer Protection Law ("UTPCPL"), 73 Pa. Stat. Ann. § 201-1, et seq. (Count III). Plaintiff seeks to recover its actual losses of $39,689.01 (the value of the mushrooms in the July 21, 2018 shipment to Atlanta, Georgia) and $3,157.05 (the cost of replacement goods purchased by one of its customers to cover the goods that were not timely delivered), as well as its attorney's fees.¹

II. LEGAL STANDARD

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). An issue is "genuine" if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248, 106 S.Ct. 2505, 91 L.Ed.2d 202 (1986). A factual dispute is "material" if it "might affect the outcome of the suit under the governing law." Id.

"[A] party seeking summary judgment always bears the initial responsibility of informing the district court of the basis for its motion, and identifying those portions of [the record] which it believes demonstrate the absence of a genuine issue of material fact." Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S.Ct. 2548, 91 L.Ed.2d 265 (1986). Where the nonmoving party bears the burden of proof on a particular issue at trial, the movant's initial Celotex burden can be met simply by "pointing out to the district court" that "there is an absence of evidence to support the nonmoving party's case." Id. at 325, 106 S.Ct. 2548. After the moving party has met its initial burden, the adverse party's response "must support the assertion [that a fact is genuinely disputed] by: (A) citing to particular parts of materials in the record ...; or (B) showing that the materials [that the moving party has] cited do not establish the absence ... of a genuine dispute." Fed. R. Civ. P. 56(c)(1). Summary judgment is appropriate if the nonmoving party fails to respond with a factual showing "sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex, 477 U.S. at 322, 106 S.Ct. 2548. In ruling on a summary judgment motion, we consider "the facts and draw all reasonable inferences in the light most favorable to ... the party who oppose[s] summary judgment." Lamont v. New Jersey, 637 F.3d 177, 179 n.1 (3d Cir. 2011) (citing Scott v. Harris, 550 U.S. 372, 378, 127 S.Ct. 1769, 167 L.Ed.2d 686 (2007) ).

III. DISCUSSION

A. Count I – The Carmack Amendment

Defendant moves for summary judgment as to Plaintiff's Carmack Amendment claim on two grounds. Defendant first argues that it is not subject to liability under the Carmack Amendment because it acted as a broker in connection with Plaintiff's July 21, 2018 shipment. Defendant also argues that it is entitled to summary judgment with respect to the Carmack Amendment claim, even if the Carmack Amendment applies in this case, because Plaintiff cannot establish that it was damaged by the late delivery of its produce.

1. Application of the Carmack Amendment

Defendant argues that it cannot be liable to Plaintiff under the Carmack Amendment for damages related to the July 21, 2018 shipment because it acted as a broker rather than a motor carrier with respect to that shipment. Defendant relies on Essex Insurance Company v. Barrett Moving & Storage, Inc., 885 F.3d 1292 (11th Cir. 2018). The Eleventh Circuit noted in Essex that, if the defendant "was a ‘motor carrier,’ the Carmack Amendment applies, state-law claims are preempted, and [defendant] is strictly liable for the damage sustained by the [product] during transportation.... If [defendant] was a ‘broker,’ the Carmack Amendment does not apply...." Id. at 1299 ; see also Factory Mut. Ins. Co. v. One Source Logistics, LLC, Civ. A. No. 16-6385, 2017 WL 2608867, at *7 (C.D. Cal. May 5, 2017) (stating that the Carmack Amendment does not "apply to brokers"); Sompo Japan Ins. Co. v. B&H Freight, Inc., 177 F. Supp. 3d 1084, 1087 (N.D. Ill. 2016) (noting that "brokers are not liable under the Carmack Amendment"); Total Quality Logistics, LLC v. O'Malley, Civ. A. No. 16-636, 2016 WL 4051880, at *2 (S.D. Ohio July 28, 2016) ("The liability provisions within the Carmack Amendment do not apply to brokers and therefore, a broker is not a proper party in a Carmack Amendment cause of action." (citation omitted)); Olympus Dairy USA Corp. v. Pavil Assocs., Inc., Civ. A. No. 12-1897, 2013 WL 6493482, at *2 (E.D.N.Y. Dec. 6, 2013) ("The ‘Carmack amendment imposes liability on "carriers" [and freight forwarders] but not on "brokers," as those terms are defined by the statute....’ " (first alteration in original) (quoting Nipponkoa Ins. Co., Ltd. v. C.H. Robinson Worldwide, Inc., Civ. A. No. 09-2365, 2011 WL 671747, at *3 (S.D.N.Y. Feb. 18, 2011) )) (add'l citation omitted). Defendant maintains that it acted solely as a broker with respect to the July 21, 2018 shipment because it only arranged for the shipment of Plaintiff's produce and KG's transported the produce to Atlanta.

The United States Court of Appeals for the Third Circuit has explained that "[u]nder the Carmack Amendment to the Interstate Commerce Act of 1887, a carrier is liable for damages incurred during a shipment of goods, whereas a broker—someone who merely arranges for transportation—is not liable." Tryg Ins. v. C.H. Robinson, Worldwide, Inc., 767 F. App'x 284, 285 (3d Cir. 2019) (citing 49 U.S.C. § 14706 ). "The definition of ‘carrier’ includes ‘motor carriers,’ which are defined as ‘person[s] providing motor vehicle transportation for compensation.’ " Id. at 286 (alteration in original) (citing 49 U.S.C. § 13102(3), (14) ). "The term ‘transportation’ is then defined to include ‘services related to’ (including ‘arranging for’) the movement of property." Id. (quoting 49 U.S.C. § 13102(23) ). "Thus, the definition of ‘carrier’ encompasses entities that perform services other than physical transportation." Id. "[I]n determining whether a party is a carrier or a broker, the crucial question is whether the party has legally bound itself to transport goods by accepting responsibility for ensuring the delivery of the goods." Id. at 286-87 (citing Essex Ins. Co., 885 F.3d at 1301 ). "If an entity accepts responsibility for ensuring the delivery of goods, then that entity qualifies as a carrier regardless of whether it conducted the physical transportation ." Id. at 287 (emphasis added). "Conversely, if an entity merely agrees to locate and hire a third party to transport the goods, then it is acting as a broker." Id. (citations omitted). "This distinction ‘tracks longstanding common-law rules’ and derives from the ‘commonsense proposition that when a party holds itself out as the party responsible for the care and delivery of another's property, it cannot...