Source: s3://data.kl3m.ai/documents/govinfo/USCOURTS/USCOURTS-azd-2_06-cv-01589/USCOURTS-azd-2_06-cv-01589-0/pdf.json

Nature of Suit Code: 450
Nature of Suit: Interstate Commerce
Cause of Action: 49:81 Damaged Goods While Being Transported

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This amount is the amount listed in the contract between Plaintiff and Defendant Atlas.

Plaintiff ultimately paid Atlas the sum of $12,241.04 for the delivery of his personal property.

WO

IN THE UNITED STATES DISTRICT COURT

FOR THE DISTRICT OF ARIZONA

Raoul LEE,

Plaintiff, 

v. 

ATLAS VAN LINES, et al., 

Defendants. _________________________________

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No. CV-06-1589-PHX-SMM

ORDER

Pending before the Court is Defendant Atlas Van Lines's ("Atlas") and Defendant

Security Storage Company of Raleigh, Inc.'s ("Security Storage") Motion to Dismiss (Dkt. 6)

the case for failure to state a claim pursuant to Fed.R.Civ.P. 12(b)(6). Plaintiff Raoul Lee has

filed a response to defendants' Motion to Dismiss, which contains a Motion to Amend the

Complaint to Assert Carmack Claims. (Dkt. 8) In turn, defendants have filed a reply in support

of their motion. (Dkt. 10) 

Plaintiff Lee brought an action for damages against defendants based on state and

common law claims, including breach of contract and unjust enrichment. Plaintiff's action

stems from a contract of carriage entered into with Defendant Atlas on May 31, 2005.

Defendant Atlas agreed to safely move and deliver Plaintiff's personal property from North

Carolina to Arizona for the sum of $11,128.25.1

 Upon arriving in Arizona, Plaintiff discovered

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that many of his boxes, pieces of furniture and merchandise were lost or damaged. Defendants'

moved to dismiss this action, arguing that the state and common law claims alleged in Plaintiff's

Complaint are preempted by 49 U.S.C. § 14706, commonly referred to as the "Carmack

Amendment." Defendants further allege that Defendant Security Storage should be dismissed

as a party to this litigation since it cannot be held independently liable under Carmack.

I. STANDARD OF REVIEW

A. Motion to Dismiss

A complaint may be dismissed pursuant to Rule 12(b)(6) of the Federal Rules of Civil

Procedure only if "it appears beyond doubt that the plaintiff can prove no set of facts in support

of his claim which would entitle him to relief." Conley v. Gibson, 355 U.S. 41, 45-46 (1957);

Parks Sch. of Bus., Inc. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995). When deciding a

Motion to Dismiss, all allegations of material fact in the complaint are taken as true and

construed in the light most favorable to the plaintiff. W. Mining Council v. Watt, 643 F.2d 618,

624 (9th Cir. 1981).

A court may dismiss a claim either because it lacks “a cognizable legal theory” or

because it fails to allege sufficient facts to support a cognizable legal claim. SmileCare Dental

Group v. Delta Dental Plan of Cal., Inc., 88 F.3d 780, 783 (9th Cir. 1996). “Dismissal without

leave to amend is improper unless it is clear, upon de novo review, that the complaint could not

be saved by any amendment.” Polich v. Burlington N., Inc., 942 F.2d 1467, 1472 (9th

Cir.1991). When exercising its discretion to deny leave to amend, “a court must be guided by

the underlying purpose of Rule 15 to facilitate decisions on the merits, rather than on the

pleadings or technicalities.” United States v. Webb, 655 F.2d 977, 979 (9th Cir. 1981).

B. Federal Preemption

Federal law "shall be the supreme Law of the Land... and Thing in the Constitution or

Law of any State to the Contrary notwithstanding," and state law in conflict with federal law

is "without effect.." U.S. Const. art. VI, cl.2; Maryland v. Louisiana, 451 U.S. 725, 746, 101

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While these categories provide a helpful analytic framework, they are not "rigidly

distinct." Industrial Truck Ass'n., Inc. v. Henry, 125 F.3d 1305, 1309 (9th Cir. 1997) (quoting

English v. General Elec. Co., 496 U.S. 72, 78-80, 110 S.Ct. 2270 (1990).

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S.Ct. 2114 (1981). Federal law can preempt state law in three ways.2

 One is by express

statutory command. Morales v. Trans Word Airlines, Inc., 504 U.S. 374, 382, 112 S.Ct. 2031

(1992). Second, state law is preempted "where the scheme of federal regulation may be so

pervasive as to make reasonable the inference that Congress 'left no room' for the state to

supplement it." Rice v. Santa Fe Elevator Corp., 331 U.S. 218, 230, 67 S.Ct. 1146 (1947).

Finally, state law is preempted where "compliance with both federal and state regulations is a

physical impossibility" or state law "stands as an obstacle to the accomplishment and execution

to the full purposes and objectives of Congress." Fla. Lime & Avocado Growers, Inc. v. Paul,

373 U.S. 132, 142-43, 83 S. Ct. 1210 (1963); Wis. Pub. Intervenor v. Mortier, 501 U.S. 597,

111 S. Ct. 2476, 2481 (1991).

Where Congress has not expressly preempted state law, courts look to the "goals and

policies of the Act in determining whether it in fact preempts an action," with congressional

purpose being the "ultimate touchstone." Int'l Paper Co. v. Ouellette, 479 U.S. 481, 493, 107

S.Ct. 805 (1987); Cipollone v. Liggett Group, Inc., 505 U.S. 504, 516, 112 S.Ct. 2608 (1992).

A court's "ultimate task in any preemption case is to determine whether state regulation is

consistent with the structure and purpose of the state as a whole." Gade v. Nat'l Solid Waste

Mgmt. Ass'n., 505 U.S. 88, 98, 112 S.Ct. 2374 (1992). 

II. DISCUSSION

Defendants move to dismiss this case pursuant to Fed. R. Civ. P. 12(b)(6) on the grounds

that Plaintiff's Complaint fails to state a claim upon which relief can be granted. Defendants

argue that the state law claims alleged in Plaintiff's Complaint are preempted by the Carmack

Amendment. Defendants further allege that Defendant Security Storage should be dismissed

as a party to this litigation since it cannot be held independently liable under Carmack. Plaintiff

opposed Defendants' motion by arguing that the motion to dismiss was premature and, in the

alternative, filed a Motion to Amend the Complaint to Assert Carmack Claims. For the reasons

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set forth below, the Court finds that Plaintiff's state and common law claims are preempted by

the Carmack Amendment. However, the Court will grant Plaintiff leave to amend the

Complaint.

A. Preemption Under the Carmack Amendment

The Carmack Amendment provides shippers with the statutory right to recover for actual

losses or injuries to their property caused by carriers involved in the shipment. Prior to the

enactment of the Carmack Amendment, the liability of carriers for loss of, or damage to,

interstate shipments was determined by common law or the law of the states. Adams Express

Co. v. Croninger, 226 U.S. 491, 504, 33 S.Ct. 148 (1913). In Adams Express the Supreme

Court recognized that Carmack's purpose was to eliminate the legal mélange of state laws

governing carrier liability making it "practically impossible for a shipper... to know without

considerable investigation and trouble...what would be the carrier's actual responsibility as to

goods delivered...from one state to another." 226 U.S. at 505. The Court went on to recognize

the preemptive scope Carmack: 

That the legislation supersedes all the regulations and policies of a particular state upon

the same subject results from its general character. It embraces the subject of the liability of the

carrier under a bill of lading which he must issue, and limits his power to exempt himself by

rule, regulation, or contract. Almost every detail of the subject is so covered so completely that

there can be no rational doubt but that Congress intended to take possession of the subject, and

supersede all state regulation with reference to it. 

226 U.S. at 505-506. In the years following Adams Express, courts have consistently held that

the Carmack Amendment preempts state law remedies for loss or damage to goods shipped by

common carriers. See e.g., Hughes Aircraft v. North American Van Lines, 970 F.2d 609, 613

(9th Cir. 1992); North Am. Van Lines v. Pinkerton Sec. Sys., 89 F.3d 452 (7th Cir. 1996); Rini

v. United Van Lines, Inc., 104 F.3d 502 (1st Cir. 1997); Morris v. Covan World Wide Moving,

Inc., 144 F.3d 377, 382 (5th Cir. 1998); Smith v. UPS, 296 F.3d 1244 (11th Cir. 2002).

Therefore, the Court finds that the Carmack Amendment preempts state law claims based on

loss or damage to goods shipped in interstate commerce. 

1. Carmack Preempts Plaintiff's Claims

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Plaintiff's claims arise from loss or damage to personal property shipped by Defendants

from North Carolina to Arizona pursuant to a written contract. Plaintiff has not alleged any

injuries separate and apart from the loss or damage to his personal property. Accordingly, the

Court finds that the Carmack Amendment preempts Plaintiff's state and common law claims and

will grant Defendants' Motion to Dismiss.

2. Defendant Security Storage Remains a Party

Defendants' claim that Defendant Security Storage cannot be held independently liable

under the Carmack Amendment and therefore should be dismissed as a party to this action. The

Court declines to address Defendants' argument at this point in the litigation. The question of

whether Defendant Security Storage can be held independently liable under Carmack is not ripe

for review because Plaintiff has yet to assert a federal claim. Accordingly, Defendant Security

Storage remains a party to this action. 

B. Plaintiff's Motion to Amend the Complaint

Plaintiff requests leave to amend his Complaint to assert federal claims. Dismissal

without leave to amend is improper unless it is clear, upon de novo review, that the complaint

could not be saved by any amendment. Polich v. Burlington N., Inc., 942 F.2d 1467, 1472 (9th

Cir. 1991). Having determined that the dismissal of Plaintiff's state and common law claims is

necessary under the Carmack Amendment, the Court finds that justice requires granting Plaintiff

leave to amend his Complaint. Plaintiff asserted his state and common law claims in good faith

and it appears that the Complaint's deficiencies can be cured by basing the claims on federal law

instead of state and common law. Accordingly, the Court will grant Plaintiff leave to amend

the Complaint. 

CONCLUSION

For the reasons set forth above, 

IT IS HEREBY ORDERED that Defendants' Motion to Dismiss the Complaint

pursuant to Fed.R.Civ.P. 12(b)(6) (Dkt.6) is GRANTED IN PART and DENIED IN PART

as follows:

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GRANTED Without Prejudice: Plaintiff's Complaint is DISMISSED WITHOUT PREJUDICE

and WITH LEAVE TO AMEND. 

DENIED: Defendants' request that Defendant Security Storage be dismissed as a party to this

action.

IT IS FURTHER ORDERED that Plaintiff's Motion to Amend the Complaint to Assert

Carmack Claims (Dkt. 8) is GRANTED. Plaintiff must file an amended Complaint no later

than November 17, 2006.

DATED this 23rd day of October, 2006.

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