Traction Tire, LLC v. Total Quality Logistics, LLC, CIVIL ACTION NO. 19-5150
| Decision Date | 09 October 2020 |
| Docket Number | CIVIL ACTION NO. 19-5150 |
| Parties | TRACTION TIRE, LLC, Plaintiff, v. TOTAL QUALITY LOGISTICS, LLC, Defendant. |
| Court | U.S. District Court — Eastern District of Pennsylvania |
On September 30, 2019, Plaintiff Traction Tire, LLC ("Plaintiff") filed its original Complaint against Defendant Total Quality Logistics, LLC ("Defendant") and BOK Logistics, Inc. ("BOK")1 in the Court of Common Pleas of Bucks County, Pennsylvania. (Doc. No. 1.) On October 31, 2019, the action was removed to this Court. (Id.)
Thereafter, on November 21, 2019, Plaintiff filed a First Amended Complaint ("FAC") alleging breach of contract claims against Defendant (Counts II and III) and a Carmack Amendment violation under 49 U.S.C. § 14706 against BOK in Count I.2 (Doc. No. 12.)
On December 4, 2019, Defendant Total Quality Logistics, LLC, filed the instant Motion to Dismiss pursuant to Federal Rule of Civil Procedure 12(b)(6). (Doc. No. 14.) In the Motion, Defendant alleges that Plaintiff's breach of contract claims should be dismissed for three reasons. First, they are precluded by the Carmack Amendment, 49 U.S.C. § 14706(a).3 (Id.) Second, they are preempted by federal law, specifically the preemption provisions4 of the Interstate Commerce Commission Termination Act ("ICCTA"), 49 U.S.C. § 14501(b),5 and the Federal Aviation Administration Authorization Act ("FAAAA"), 49 U.S.C. § 14501(c)(1).6 (Id.) Third, they consist only of conclusory allegations of unspecified contractual terms which are insufficient to state a claim for relief. Defendant also argues that the damages Plaintiff seeks are "unavailable under the Carmack Amendment." (Id. at 16.)
The Motion is now ripe for disposition. For reasons set forth below, Defendant's Motion to Dismiss will be denied.
This case arises from the shipment of tires from Pennsylvania to Florida. (Doc. No. 12.) Plaintiff Traction Tire, LLC is a tire supplier and distributor, and Defendant Total Quality Logistics, LLC, is a freight broker. (Id.)
In the FAC, Plaintiff alleges the following facts. In the summer of 2017, Plaintiff entered into an agreement with Defendant to coordinate the transportation of 590 tires from Plaintiff's facility in Bensalem, Pennsylvania, to its customers, Trotta Tire and Ace Tire, located in Fort Lauderdale and Miami, Florida, respectively ("Contract 1").7 (Id.) Pursuant to Contract 1, the tires were to be picked up at Plaintiff's facility on August 25, 2017 and delivered to its customers in Florida by August 28, 2017. In exchange for transporting the tires, Plaintiff agreed to pay Defendant $3,000. (Id.) The parties agreed to these terms. (Id.)
Next, Plaintiff paid Defendant the $3,000 to ship the tires. (Id.) After receipt of payment, Defendant entered into a separate contract with BOK, a carrier, to physically transport the 590 tires to the customers in Florida. (Id.) BOK then issued a bill of lading for the tires. (Id.) On August 25, 2017, BOK picked up the tires at Plaintiff's facility. (Id.) A few days later, however, the tires were allegedly stolen from BOK's loaded trailer while it was left unattended in one of BOK's parking yards in West Palm Beach, Florida. (Id.) As a result, the 590 tires were never delivered to Plaintiff's customers nor were they ever returned to Plaintiff. (Id.)
Upon learning that the tires had gone missing, Defendant contacted Plaintiff and explained what had happened. (Id.) Intent on retaining Plaintiff as a "valuable customer," Defendant allegedly entered in another contract with Plaintiff ("Contract 2").8 (Id. 5-6.) Defendant "explicitly represented" to Plaintiff that Defendant "would reimburse [Plaintiff] for its losses." (Id.) In exchange, Plaintiff would "not ask [Defendant] for a refund of its $3,000 payment and [would] use [Defendant]'s services for multiple other endeavors." (Id.) The parties agreed to these terms. (Id.)
Following this agreement, Plaintiff continued to use Defendant's services. According to Plaintiff, however, Defendant "reneged on the agreement" and "never paid [Plaintiff] a dollar for its losses nor did it refund [Plaintiff]'s $3,000 payment" for the 590 tires. (Id. at 6.)
On September 20, 2019, Plaintiff filed its original Complaint against Defendant and BOK in the Court of Common Pleas of Bucks County, Pennsylvania. (Doc. No. 1.) Thereafter, on November 11, 2019, Plaintiff filed the FAC against Defendant and BOK. (Doc. No. 12.) In Count II and III of the FAC, Plaintiff asserts the two breach of contract claims against Defendant: (1) breach of contract for failure to deliver the 590 tires (Contract 1); and (2) breach of contract for additional expenses, costs, and interests (Contract 2).9 Further, Plaintiff alleges that as a direct result of Defendant's "failure to ensure the safe and efficient delivery of the tires," Plaintiff lost at least $1,000,000 in business as well as the value of the 590 tires, and the $3,000 that Plaintiff paid for its services. (Doc. No. 12 at 6.)
In response, on December 4, 2019, Defendant filed the instant Motion to Dismiss the FAC. (Doc. No. 14.) In the Motion, Defendant argues that Plaintiff has failed to state claims against it under Federal Rule of Civil Procedure 12(b)(6). (Id.) As noted, to support this contention, Defendant argues that Plaintiff's breach of contract claims are precluded by the Carmack Amendment and preempted by the ICCTA and FAAAA's preemption provisions. Defendant also contends that even if they are not precluded or preempted by the federal law, Plaintiff fails to establish the elements of a breach of contract claim. (Id.) Moreover, Defendant asserts that Plaintiff's claim for damages should also be dismissed. (Id.)
On January 2, 2020, Plaintiff filed a Response in Opposition to Defendant's Motion to Dismiss. (Doc. No. 18.) In the Response, Plaintiff asserts that the breach of contract claims against Defendant are not preempted by federal law and that it has sufficiently pled claims against Defendant for breach of Contracts 1 and 2. (See Id.) Moreover, Plaintiff contends that the requested damages are warranted. (Id.)
A. The Motion to Dismiss Standard under FRCP 12(b)(6) - Failure to State a Claim.
The motion to dismiss standard under Federal Rule of Civil Procedure 12(b)(6) for failure to state a claim is set forth in Ashcroft v. Iqbal, 556 U.S. 662 (2009). After Iqbal it is clear that "[t]hreadbare recitals of the elements of a cause of action, supported by mere conclusory statements, do not suffice" to defeat a Rule 12(b)(6) motion to dismiss. Id. at 678; see also Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007). "To survive dismissal, 'a complaint must contain sufficient factual matter, accepted as true, to state a claim to relief that is plausible on its face.'" Tatis v. Allied Interstate, LLC, 882 F.3d 422, 426 (3d Cir. 2018) (quoting Iqbal, 556 U.S. at 678). Facial plausibility is "more than a sheer possibility that a defendant has acted unlawfully." Id. (quoting Iqbal, 556 U.S. at 678). Instead, "[a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged." Id. (quoting Iqbal, 556 U.S. at 678).
Applying the principles of Iqbal and Twombly, the Third Circuit in Santiago v. Warminster Township, 629 F.3d 121 (3d Cir. 2010), set forth a three-part analysis that a district court in this Circuit must conduct in evaluating whether allegations in a complaint survive a Rule 12(b)(6) motion to dismiss:
First, the court must "tak[e] note of the elements a plaintiff must plead to state a claim." Second, the court should identify allegations that, "because they are no more than conclusions, are not entitled to the assumption of truth." Finally, "where there are well-pleaded factual allegations, a court should assume their veracity and then determine whether they plausibly give rise to an entitlement for relief."
Id. at 130 (quoting Iqbal, 556 U.S. at 675, 679). The inquiry is normally broken into three parts: "(1) identifying the elements of the claim, (2) reviewing the complaint to strike conclusory allegations, and then (3) looking at the well-pleaded components of the complaint and evaluating whether all of the elements identified in part one of the inquiry are sufficiently alleged." Malleus v. George, 641 F.3d 560, 563 (3d Cir. 2011).
A complaint must do more than allege a plaintiff's entitlement to relief, it must "show" such an entitlement with its facts. Fowler v. UPMC Shadyside, 578 F.3d 203, 210-11 (3d Cir. 2009) (citing Phillips v. County of Allegheny, 515 F.3d 224, 234-35 (3d Cir. 2008)). "[W]here the well-pleaded facts do not permit the court to infer more than the mere possibility of misconduct, the complaint has alleged—but it has not 'show[n]'—'that the pleader is entitled to relief.'" Iqbal, 556 U.S. at 679 (alteration in original) (citation omitted). The "plausibility" determination is a "context-specific task that requires the reviewing court to draw on its judicial experience and common sense." Id.
When determining whether a claim is plausible, a district court may also consider any affirmative defenses raised by the moving party. "Technically, the Federal Rules of Civil Procedure require that affirmative defenses be pleaded in the answer." Robinson v. Johnson, 313 F.3d 128, 135 (3d Cir. 2002) (citing Fed. R. Civ. P. 12(b)). However, the so-called "Third Circuit Rule" allows affirmative defenses to be raised in a 12(b)(6) motion. Id.; see also Ball v. Famiglio, 726 F.3d 448, 459 n.16 (3d Cir. 2013) cert. denied, 134 S. Ct. 1547 (U.S. 2014) ().
For instance, a statute of limitations defense may be raised in a motion to dismiss if "the time alleged in the statement of...
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