## In the



# U n ited S ta tes Co urt o f Ap p ea ls

F o rth eS e v e n th C ir cu it
N os. 11

- 2949 & 11

- 2967 K AW ASA KI K I S EN K AI S HA, L TD ., “ K” L I NE A MERI CA, I NC . , a nd U NI ON P ACI FI C R AI LROAD C O ., P la intif fs-A pp ella nts, v.
P L A NO M OLDI NG C O ., D efend a nt-A pp ellee.

A pp ealsfr o m the United S t ates Di strictC our t fo r the N o rthernDi stricto f Illino is, Eas tern Div isi on. No . 07 C5675

—H arry D . L einenw eber, Judge .
A RGUED M AR CH 27, 2012

— D ECI DE D A UGUS T 29, 2012

B efore F LA UM, W I L L I A MS, an d T IND ER C ircu it Judges . F LA UM, C ircu it Judge. O n Apr i l2 1 , 2 0 0 5 , a Uni on Pa ci fi c R a i l r o a d C o . t r a i n d e r a i l e d i n O k l a h o ma c a u s i ng ex ten sive da m age to both the rail r o ad and the train’s c a r g o . Ka wa s a k iKi se n K a i s h a , L t d
. ( “ Ka wa s a k i ” ) , “ K” L ine Am er i ca, Inc . ( “KAM ”) ( co l l ec ti ve l y “ K- Li ne ”) , a nd U n ion P ac ific R ailr oa d C o. (“U n ion P ac ific” ) (co llec tiv ely2 N os. 11

- 2949 & 11

- 2967 “a ppel l an ts ”) b l ame P l an o M o ldingCo
. ( “P l an o ”) f o r the d erail m en t, all eging P lano’s steel i njection m olds w ere im p ro p er ly p a c k e d , bro ke th ro u gh th eir cr at e, an d fell o nt o the t r ac k
. Appel l an ts no w at te m pt to ho l d Pl an o l i ab l e f o r c er ta i n da m ag es c au se d b y the de r ai lm en t, a nd see k ind em ni fi cati on f orcl ai m s m ade ag ai nst them by othe rs wh o suffer ed l oss es in t he acc i dent. The di str i ct cour t g ra nted Pl ano’ s m oti on f or s u m m ar y j ud gm ent. Forthe re aso ns se t for th be l ow, w e r eve rs e in part, a ffi r m i n pa r t, a nd r e man d.

I . B a c kg r o und A. Fa c t ua l B a c kg r o und Pl ano i s a n I l l i noi s co rpor ati on tha t desi gns, m anufa ctu re s, an d se lls p las tic s t o r ag e b ox es , in c lu d in g t ac kle bo xe s. I den ti fy i ng a ne ed f o r ne w m o l ds, Pl an o c o ntact ed CM T I nter nati onal, Inc. ( “CM T”), a ser vi ce provi der that a ssi sts cus to m er s in the U ni ted S tat es w h o w i sh to purchase pro du cts fro m A si a. A fteres tabl i s hingP l a no ’ s mo l d s pe c i fi c a t i o ns , CMT so l i c i t e d b i ds fro m m anufa cture rs i n Tai w an and Chi na. CM T prese nted P lan o w ith th e b id s, an d P l a n o s ele c te d K u n sh an , a C h ine se com p an y, as its fabricator. T he p urc ha se orders ( “P Os” ) b etwee n CM T a nd Pl an o w ere f o r the “ des i g n, engi neer, co nstr uct and supply” o ftwo st eeli nj ecti on m ol ds f oruse i n Pl ano’ s I l l i noi s f acto ry . I t i s undi spu te d tha t W o r l d, a no n- ve ss elo per at i ng com m on car ri er, w as sel ecte d t o coo rdi nate the m old s’ tr an spo r ta tion fr o m Chi na t o the Uni te d S ta te s. The or i gi nalte rm s o fcarr i age were Fr ee on Boar d ShanghaiN os. 11

- 2949 & 11

- 2967 3 ( “F OB S ha ngha i ”)
. The t er m F OB i ndic at es tha t th e buy e r t a k e s o wne r s hi p o f the g o o ds a s s o o n a s i t pass es ove r the ra i lo fthe shi p. A t W or l d’s sugge sti on, i n a s er i es ofem ai l s be tw een Robb Yunger ( “Yunger”) o fPl ano, J ohn W em ber( “W em ber ”) o fW orld , and A m na S hah ( “S ha h” ) o fCM T, the pa r ti es a g r ee d t o a l te r the del i ver y t er m s fro m FOB Shanghaito Del i ver ed Du ty Pai d (“D D P ”). U nd erDD P ter m s, the buyerdoes not ta k e o w n er sh ip u n til th e g oo d s a rriv e a t it s d oo r. W or ld r epr es en ta ti ve W ember e xpl aine d tha t en su r i ngthe cor re ct s hi pp i ng te rm s was para m ount be cau se “i fanyth ing w ere to hap p en i n tran sit you w a n t y o ur p ap erwor kt o r efl ec t th e true t er m s. ” Des pi te thi s di sc ussion, th e W orl d b i l lo fl adingi ndi ca te s th atW o r l d was the co ns i g ne e, c o ns i st en t wi thF OB S ha ngha is hi ppi ng ter m s. Even so , CM T sent Pl ano an i nvoi ce date d Jul y 1 4, 20 05
. Thi s i nv o i ce cha rge d Pl an o f o r the pr i ce o fthe m old s, as w ell as sh ip p in g ; C M T p aid W or ld d ire c tly f orcer tain shi pp i ng co sts , bi l l i ng Pl ano l ate r. CM T al so pai d the i m portduty and custo m cl ear ed ser vi ce c harg e, an d t h e n in vo ice d P lan o. T h es e fa c ts su gg es t t h at it w as C M T th at arr an ge d th e t ra n s p o rt at ion w ith W or ld und erDD P ter m s. As th e fr e i g h tf o r wa r d e r, Wo r l d c o n t r a c t e d wi th T HI Group LT D ( “TH I ”) and K

- Line to shi p the m ol ds fro m Chi na t o I l l i no i s. K- L ine su bc o nt r ac te d the move m en t w i thi n the U ni ted S tat es, from Cal i f or ni a t o I l l i noi s, to U ni on Paci fi c. K-Line suppli ed the shi pp i ng co ntai ner to THI, a nd the mol ds wer e p acke d o n- si te a t Kunsh an . THI de l i ve r ed the go o ds, pack ed i n the co nt aine r, to K- Li ne4 N os. 11

- 2949 & 11

- 2967 i n S ha ngha i
. K- Li ne t r anspo r te d the mol ds fr o m Chi na to the Uni t e d S t a t e s , t r a ns fe r r i ng the mol ds t o a U ni on Paci fi c i n Ca liforni a. The tr ai n derai l ed nearTyr one, O kla h om a o n A p ril 21 , 200 5, c a u s i n g $ 2 m illion in d am ag e t o K -L in e c u st om er s’ c ar g o a n d se p ar at ely co st i ngUni o n P ac i fi c ab o ut$ 2 m i l l i o n. Pl an o recei ved W or l d’s bi l lo fl adingvi a e m ai lo n Apri l3 , 2 005 , the da y the mol ds wer e pl ac ed o n the sh i ppi ng ve ss el i n S ha ngha i
. The W o r l d bi l l of l ading conta i ned a “ H im al aya cl ause” gr anti ng W or l d’s subc on tr ac to rs all w ar ra n tie s a n d ind em n i tie s d efin ed in th e W o r l d b i l l of la di ng . Re l ev an t to thi s ca se , unde r the W or l d bi l lo fl ading, wh en a con ta in er i s pack ed by a p ar ty o therthan W or l d, the “ M er chant” w ar ra nts “ that th e stow age an d seals ofth e c o n tainers are safe an d p r o p e r a n d s u i t ab l e f o r h a n d l i n g a n d c a r r i ag e an d ind em nifies [ W or l d] forany i nj ury, l oss o r d am age cau sed by breach of th is w arran ty.” ( em p ha s is ad d ed ). Se cti on 2
. 3 of the W or l d bi l lo fl adingdefi nes “ M er chant” as “ th e S hi pper, the Re ce i ve r, the Co ns i g no r, the Co nsi gnee, the H ol der o fthi s Bi l lo fL ad in g and any perso n ha vinga pr es en t o r futur e i nt er es t i n the G oo ds o r a ny pers o n a c t i ngo n b e ha l fo fa nyo fthe ab o v e - men t i o ned p er so n s.” K- Li ne i s s ue d i t s o wn b i l lo fl a di ngwh i c h c o nt a i ned a si m i l ari nde m ni fi ca ti o n pr o vi si o n: I fGo o ds r e c e i v e d b y Ca r r i e r a r e i n Co nt a i ne r( s) i nto w hi ch co n te n ts have been packed by oro n be ha l fo fM er ch an t, M er ch an t war r an ts tha t th e st o wag e an d s ec ur i ngo fthe c o nt en ts o fthe Co n-N os. 11

- 2949 & 11

- 2967 5 ta i ne r ( s) a nd the i r cl o sing an d s ea l i nga r e sa fe an d al so w ar ra nts that Conta i ner( s) and conte n ts ther eofar e suit abl e fo r Carr i age . . . . In the eve nt o f M er chant’ s br each o fsa i d w ar ra nti es, Carr i er shal lnotbe re sp onsibl e forany l oss o fo r dam age to o r i n c o nne ct i o n wi th goods a nd M er ch an t s ha l lb e l i ab l e f o r l oss o fo r da mag e t o a nyp r o pe rt y, o r f o r p e r s o na li nj ury . . . a nd s ha l lde fe nd , in d em n ify a n d h old C ar rie r h ar m l e s s ag ain st all los s, d am ag e, liab ility , cos t o r ex p en se . . . . The defini ti on o f“M er chant” i n K

- Line’ s bi l lo fl adingwas sim il arly inc lusive d efi nin g a “M erc h a nt ” as “sh ipp er, co ns i g no r, c o ns i g ne e, o wnera nd r ec ei ve r o fg o o ds, a nd h old er , an d an yo n e a c tin g on be h alf ofan y s u c h p er so n .”

B . P r o c e dur a l B a c kg r o und Fol l owing the der ai l m ent of the U ni on Paci fi c tr ai n near Tyro ne, Okl ahom a, i n A pri lo f20 05, ei ght c om pla i nts w er e fi l ed i n the So uthern Dist ri ct o fN ew Yor k b y ow n er s o f ca rg o d am ag ed b y t h e d er ailm en t, or t h eir subro gat ed i nsurer s, ag ai nst Kaw asak i, KA M , and U ni on P a c i f i c . Un i o n P a c i fi c a l s o s u e d Ka wa s a k ia n d KA M f o r da m ag e to the r ai l r o ad pr o per ty. K awas ak ia nd K A M filed t h ird -p ar ty co m p lain ts ag ain st P lan o, W or ld C o mme r c e S e r v i c e s L L C ( “ W o r l d” ) a n d C MT f o r i n d e mni ty or contr ibuti on. U ni on Paci fi c fi l ed a th ird- party c o mp l a i n ta g a i n s tP l a n o a n d C MT o n th e s a me gr ounds. Four othe r car go dam age case s w er e filed i n Cal i f or ni a.6 N os. 11

- 2949 & 11

- 2967 T h e th i r d

- p a r t y c o mpl a i n t s a g a i n s t C MT a n d Pl an o w er e di sm i sse d by the di str i ct c ourti n N ew Yor k for l a c ko fp e r s o n a lj u r i s d i c t i o n, and Ka wa s a k ia n d KA M th en filed an ac tio n in t h e N or t h e r n D ist ric t o f Ill in ois ag ains t Pl an o an d CM T. The I l l i no i s ac ti o n and the eig h t N ew Y or k ac tio n s w er e ce n tr aliz ed for c on so lidated, pre - tr i alpro ceedi ng i n the S outher n Dis tr i ct o f N ew Yo r k
. Uni o n P ac i fi c fi l ed a co m pl ainti n int er ve nt i o n. Al lc a r g o c l a i ms h a v e s e t t l e d , a s h a v e a p p e l l a n t s ’ c l a i ms aga i nst W or l d and C M T , lea vi ng o nl y the cl ai m s o f Kawas ak i, KA M , a nd Uni o n P ac i fi c ag ainstPl an o . The So uthern D istr i ct o fN ew Yor k t ra nsfer re d the ca se to th e N orthe rn D istri ct of I ll inois, w he re the d istri ct cou rt granted Pl ano’ s m oti on f orsum m ar y j ud gm ent. Th is a pp e a lf o l l o we d.

I I . Discussi on We r e v i e w d e n o v o th e d i s t r i c tc o u r t ’ s g r a n to fs u mm a ry j u d gm en t. O ’Le ary v. Accre ti ve Health , 65 7 F
. 3d 625, 630 ( 7th Ci r. 20 11)
. S um m ary j ud gm ent i s a pp ro pri ate wher e th e m ovan t demons tr at es tha t th er e ex i st s no g enui ne di spu te a s to a n issue o fmate r i alf ac t, a nd he is e n tit led to j u d gm en t a s a m at te r of law . F ED . R. C IV . P. 5 6( a)
. The c o ur t m us t r ev i ew the r ec o r d i n the l i g ht m o stf av o r ab l e to the no n- m o vingpa r tya nd c o ns true all re as on ab le in fer en c es in t h at p ar ty ’s fa vo r. Righ i v. SM CC o rp., 6 3 2 F
. 3 d 4 0 4 , 4 0 8 ( 7 th C i r . 2 0 1 1 )
. He r e , we apply federa lm ar i ti m e l aw bec ause j uri sdic ti on e xi sts u n d er 28 U .S.C . § 13 33
. See N orfolk S. Ry
. Co
. v . Kirby, 54 3 U. S
. 1 4, 24- 25 ( 20 04 ) ( fi ndi ngb i l l s o fl adingi nv o l vingN os. 11

- 2949 & 11

- 2967 7

ove rs eas shi pm ent o fgo ods t o be m ar i ti m e co ntra cts even w he re the last leg ofthe j ou rney w as by rail ). Appel l an ts uns uc ce ss ful l ys o ug htda m ag es a nd i ndem ni f i cati on f ro m P lan o in th e d ist ric t c ou rt, ass er ti ng the or i es gr ounded bo th i n contr act and tort. T h o u g h w e c o n c l u d e th a ta p p e l l a nt s ’ n e g l i g e n c e c l a i ms wer e pr o per l y rej ec te d, we fi nd un r es o l ve d que st i o ns off act m ate ri al to the deter m i nati on o fo ne o fappel l ants’ con tract claim s. T he refore, w e affirm the d istri ct cou rt as to th e co nt r ac t cl ai m b as ed o n K- Li ne ’ s bi l lo fl ading b u t re ve rs e a s t o th e c on tr ac t c laim ba se d on W or ld ’s b ill ofl ading
. W e a l so affi rm the dist ri ct c ourt ’ s deci si on re ga rd i ng the negl i gence cl ai m s. W e r em and fo r further pr o ce eding s co ns i st en t wi ththi s o pi ni o n.
A. C o n t r a c tC l a i ms Appe l l a nt s a s s e r ttha tP l a no i s l i ab l e f o r i nj uri es ca us ed bythe t r ain de r ai l m en t unde r b o ththe K- Li ne a nd W o r l d b i l l s o fl ading . Underb o thb i l l s o fl ading, Pl an o coul d l i k e l y b e c o ns i de r e d a “ M e r c ha nt ” a nd thu s s ubj ect to l i abi l i ty i fi t br eached the warra nty t o safel y a nd adequatel y pack age the m olds i t handed ove r f orshi pm ent. First, ap p ell an ts argu e th at W orld w as actin g as P la n o’s age nt u n d er a non- tr adit i onalag ency theo ry, and ther efor e le ga lly b ou n d P lan o t o th e K

- L in e b ill of lad in g. In th e alte rn at ive , ap p ella n ts ar gu e th at P lan o is l i a b le und er K -L ine’ s bi l lo fl adingbec ause Pl ano accepte d i ts ter m s thro ugh conduct. Fina lly, appel l ants conte nd that Pla n o c ont racted directly w ith W orld, an d i s the refore8 N os. 11

- 2949 & 11

- 2967 b ou n d to th e W or ld bill of lad in g, w h ich co n ta in s e x p l i c it w arr an ti es f o r pa ck ag ed ca r g o a nd a ppl i es t o K- Li ne and U ni on Paci fi c thr ough the H i m al aya cl ause. A bi l lo fl adingcan ser ve m an y functi ons. M ostfund am ental l y, i t i s an acknow l edgm ent o fthe re cei pt f or go od s. C a rg i l l F e r r o u s In t e r n . v . S e a P h o e n ix MV , 32 5 F. 3d 695, 7 03 ( 5th Ci r. 20 03)
. But i t ca n al so be e vi dence of ti tle, or m ore i m p ort a n t ly, serve as eviden ce of a c on tr ac t o f ca rria ge . Id . “T h e b ill oflad in g is t h e b as ic tr anspor tat i on co nt ra ct b etween the shi pp er - consi gnor an d the c ar r i er ; i ts t erm s an d c o ndi ti o ns b i nd the sh i pp erand al lco nnecti ng ca rr i er s. ” S
. Pa c . Tra n s p . Co. v. C o m m ercia l M etal s C o ., 45 6 U .S. 33 6, 34 2 (1 98 2); see a lso C .A .R . Tran sp. B rok erag e C o . v. D a rden R ests., Inc., 21 3 F
. 3d 474, 47 8- 79 ( 9th Ci r. 20 00 ). “Contrac ts f orcar ri age o f goo ds by sea m u st be const rued l i ke any o therco ntra cts: b y t h e ir term s and cons istent w ith th e inten t of th e pa rti es. ” K ir by, 54 3 U.S
. at31
. The questi on here i s whether Pl ano can be bound to the K

- Line and W or l d bi l l s o f l adingas the pu rchas ero fthe m ol ds.

1 . K- L i ne B i l l o fL a di ng Appell ants fi r sta tt empt t o b i nd Pl an o t o the K- Li ne bi l lo fl adingunder a non- tr adit i onalag ency theo ry . U n d er tr ad itio n al ap p ro ac h, an ag en c y r e lat ion sh ip re qui r es tha t a pr i nc i paldi r ec t ana g en t to a ctf o r the pri nci pal ’ s benefi t, the age nt to co nsent, and the pri nci pal to h av e t h e p ow er to co n tr ol th e a ge n t’s ac tio n s. U nited St at e s v. A ldrige, 64 2 F
. 3d 537, 54 1 ( 7th Ci r. 20 11)
. But asN os. 11

- 2949 & 11

- 2967 9 th e S upr eme Co ur t ar ti cul ated i n K ir by, mar i ti m e co ntr ac ts f o r t r a n s p o r t a r e o ft e n n o t s u s c e p t ib l e t o s u c h a t r a d i t i o n a la n a l y s i s . 5 4 3 U. S
. a t3 4
. In s t e a d , th e S u p r e me Co ur ts e tf o r th a mo di fi e d t e s twhi c h no ne the l e s s fi nd s an ag en c y re lat ion sh ip in n ar ro w ci r c u m st an c es . Id
. H er e, ap p ella n ts at te m p t t o b in d P lan o t o th e K -L in e b ill o fl ading, c o nt en di ngtha t W o r l d a ct ed as i ts a g en t und erthe Ki r b y appr o ac h. Howev er, a s we wi l le xpla i n, the non- tr adit i onalanalysi s i s v er y l i m ited in i ts appli cati on, and i ts em plo ym ent he re i s inapp ro pri ate
. W he n a bu y e r or ow ne r ofgood s nee d s to trans p ort hi s i te m s, the o wner wi l lo fte n c o nt r ac t wi tha fr ei g ht for w ar der t o ass i st i n the shi pm ent. S om eti m es th is f orw ar der i s e ntrust ed w i th tho se goo ds as a fi rs t- ti er car ri er, but d ec ides t o sub- contr act the m ove m ent t o an o th ers ec o nd- ti erc ar r i er . Thi s was the c as e i n Gre at N
. Ry. C o . v. O ’ Connor, 23 2 U.S
. 50 8, 51 4- 15 ( 1914 )
. There , the Cour t e stablish ed that a fi rs t- ti ercar ri ercan enter into en forcea b le cont racts w ith secon d -ti er carriers w ith ou t t h e e x p re ss co n se n t o f th e o w n er . Id
. S peci fi cal l y, the Cour t hel d that the ag re em ent b etween the fi rs tan d s ec o nd- ti erc ar r i er s to puta c ei l i ngon th e v alue of ow ne r’s goods w as en forceable against the ow ne r, e v e n tho ugh the o wne r ha d ne v e r a g r e e d t o the l ower value
. Id
. Thi s was bec ause the s eco nd

- ti ercar ri er“had the r i ght t o ass um e that the [fir st- ti ercar ri er ] co uld ag re e up on the t er m s o fthe shi pm ent. ” Id
. T he resul t, o fco urse , w as th at w h en th e o w n er ’s g oo d s w er e d am ag ed in tr ansi t, herr eco ver y fro m the seco nd

- ti ercar ri erwas l i mi t e d t o the v a l ue n e g o t i a t e d by th e fi r s t
- a nd s e c o nd

ti erc ar r i er s. The Court r el i ed o n G reat N . Ry . Co
. in K ir by, wh i ch expanded o n thi s princi ple
. 54 3 U.S
. at34
.10 N os. 11

- 2949 & 11

- 2967 I n K ir by, a c ar g o o wnerhired a n int er m edi ar y fr ei g ht for w ar ding com pany to f aci l i tat e the tr anspor t of h is go od s fro m A u st ra lia to th e U n ite d Sta te s. Id
. The i nter m edi ar y th e n h i r e d a s h i p p i n gc o mpa n y t o t r a n s p o r tt he g o o ds, a nd the shi ppi ngc o m pan y s ubc o nt r ac te d the ov er lan d p or tio n of th e t rip
. Id
. at 19. Foll ow ing an overse as j o ur ne y, the c ar g o was da m ag ed w hi l e be i ng c ar ri ed by rail. Id
. at18
. There , the i nter m edi ar y had n e g o t i a t e d a l i ab i l i t y l i mi t a t i o n w i th th e s h i p p i n gc o mpan y, whi chwas a l so pa ss ed al o ngt o the s ub contr ac ting ra ilroa d
. Id. at 32- 33. The ra i l ro ad ar gued that its liabi l i ty to the c ar go own erwas capped by a l i m i tat i on o f li abili ty ne gotiated by the up stream carrier; plaintiff ca r g o o wnermai nt aine d tha t it wa s no t bo und b y the l i m i ta tio n beca use i t di d not a gr ee to thos e t er m s. Id
. The Cou r t si ded wi th th e r ai l r o ad ho l di ng th at an i nt e r me d i a r y c a n b i n d “ a c a r g o o wn e r t o t he l i a b i l i t y l i mi tat i ons i t neg oti ate s with do w nstr eam car ri er s. . . . ” Id
. at 34
. In re achi ng thi s co ncl usi on, the Court hel d that an i nt e r med i a r y c a n s e r v e a s the o wne r ’ s a g e nt f o r “a si ngle, l i m i t e d pur po se : when[ th e i nt er m edi ar y ] c o ntr ac ts w ith su b se q u en t c ar rie rs f o r lim ita tio n on liab ili ty. ” Id
. A n inte rm ed iary’s au th ority to act as the ca rgo ow ne r’s ag en t i s n a rro w ly ta ilore d ; i t w ou ld be u n su st ain ab le to re cogni ze an i nter m edi ar y a s a n age nt f orthe car go ow n er in “ eve ryse nse” because o fthe potenti alto ex p os e t h e o w n e r t o u n au th or ize d liab ility
. K ir by, 54 3 U
. S. at 33. A s the Sup rem e C ou rt has recogn ized , “interm ed iar ies , en tr u st e d w ith goo d s, ar e ‘a ge n ts ’ on ly inN os. 11

- 2949 & 11

- 2967 11

T ho u g h a p p ellan ts a rg u e tha t the rec en t Su p rem e C ou rt case 1 o f K a w a sa k i v . R eg a l-B elo it, 1 3 0 S. Ct
. 2 4 3 3 , 2 4 8 8 ( 2 0 1 0 ) , e x t e nd s th is p ri n ci p le , th ey m is c o n str u e t h e i m p o rt o f th a t c a se . R eg a lB elo itdea l twith the s am e der ai l m en tati s s ue he re, b u tthe que s t i on befor e the Cour tdi ffer ed s i gni fi c ant l y. T he re , the Cour te xa m i ne d whethe r the v en u e p ro vi s i ons s etf or th i n a through b ill o f l ading, which dict ated that the ent ir e j ourney w ou ld b e g ov ern ed b y the C arr iag e of G oo d s by Sea A ct, w ou ld ap p ly to the d om estic p art o f the im p or t’s j ou rn ey b y a rail carr ie r, despit e prohibit ions or l im itations in another federal st atute , the Cerm ack Am endm ent. 130 S. Ct. at 2439. The Co urt ans were d i n the aff irm at i ve, ho l di ng thatthe ag re ed upo n f or um -selectio n t er m s i n the bi l l ofl adi ng bo und the c ar go ow ne rs. In so ho ld ing , the C ou r t f ou nd tha t C erm ack ’ s pr ov isi ons d o not apply to a shi pm ent origi nati ng ov ers eas und er a th ro u g h b ill o f la d i n g . Id
. at 2446. Thou gh the Court deter

m i ne d thatthe bi l l ofl adi ng bo und the c arg o o wner s , the f act s in that cas e are dist inct
. There, the o w n er s contrac ted di re c t l y with K- Li ne , r ai s i ng n o ques t i ons r el at ed t o fi rs t
- or se co n d - tie r c a rr ie r li a b ili ty
. Id
. Wh a tw e c a n t a k e fr o m R eg a lB elo it i s the Co ur t ’ s c on c l us i ontha twhe r e a c a r go o wner agrees to a bil l ofl ading, l iabil ity and venue rules contai ned th er ei n w ill b e e n fo rc ea b le
. Id
. at 2448. thei r abi l i ty to contr act f orl i ability l i m i tat i ons w i th car ri er s down str eam . ” Id
. at35
. A s we r e c e nt l y e xp l a i ne d: 1 The i dea i s tha ti fA e ng a g e d B t o h a nd l e a s hi pm en t, am o ngo th erthi ng s, A ha s del eg at ed to B the choi ce b etween a lo w er pri ce with a s tr i ct l i m i tati on o fl i abi l i ty an d a hi gherpri ce without o ne, w h en B en ga ge s t h e s er vic es of C ar rie r C
.12 N os. 11

- 2949 & 11

- 2967

The y a s k thatw e ho ld Pla no l i abl e underthe K- Li ne bi l l of 2 lad ing , w hich con tain s a w arr an ty a n d lim itation of liab ility c l aus e re gar d i ng g oods pac kage d by s om eo ne othe r thanthe carr ie r. N ippon koa Ins . Co. v. A tl as Van Lines, Inc. , ___ F
. 3d ___, 20 12 W L 2 5 8 0 1 2 0 ( 7 th Ci r . 2 0 1 2 )
. Th o ugh a pp e l l a nt s ur g e us to cl ass i fy W or l d a s Pl ano’ s a gent und erthi s no n-t ra dit i onal Kir b y th e o r y, th e r e b y r e n d e r i n gP l a n o l i ab l e u n d e r th e KLi ne b i l lo fl ading, we m us t pa us e t o co ns i derwhethe r the appli c ati on o fthi s no n-t ra dit i onaltheo ryi s a pp ro pri ate
. U pon re vi ew , we agr ee w i th the dist ri ct c ourtthati t i s no t. The Suprem e Cour t has l i m i ted the assu m pti on o fan a g e nc y r e l a t i o ns hi p b e t we e n a n i nt e r med i a r y and a shi pp erwh o contr ac ts f orthe i nter m edi ar y’ s s er vi ces to a nar ro w ci rcum st an c e: wh er e a n i nter m edi ar y m ake s a c o n t r a c tf o r l i ab i l i t y l i mi t a t i o n s w i th c a r r i e r s d o wn s t r e a m. Kir b y, 54 3 U.S
. at35
. W hi l e the non- tr ad i ti onalag ency theo ryi s intended to f aci l i tat e com m er ce, the Court has non eth eless cau tioned against recog nizing an i nt erm ed iar y as th e c ar go ow n er ’s a ge n t fo r all p u rp os es . Id
. at 33 ; In re M / V R ickm ers G enoa Lit
. , 622 F. S up p. 2d 56 , 73 n. 23 ( S
. D. N
. Y. 2 00 9) ( “I ft ak enl i te r al l y, the noti on tha t co nsig n or s a n d c on sig n ee s c an be as su m ed to be in a p rin c ipal/ ag en t r el at i o ns hi p woul d e xpo se co ns i g ne es t o po te nti al l y l i m i tl ess l i abi l i ty f orthe conduct and co ntra cts of their con signors.”). H er e a p p ellant s a tte m pt to l i m i t thei r own l i abi l i ty f o r da m ag es c au se d b y the tra inde r ai l m en t bys ee k i ng re i m burse m ent a nd dam age s fro m Pl ano. In a b ro ad 2 se ns e, thi s g oal is co ns i st en t wi th G reat No rthern a ndN os. 11

- 2949 & 11

- 2967 13 K ir by, w here the car ri er s sought to l i m i t their li abi l i ty to c a r g o ow n er s in ac c or d an c e w ith th eir n eg ot iat ed bills ofl ading
. S i m ilarl y, K-Line ’ s warr anty re gar ding cra ted car go co m p or ts w i th the S up re m e Cour t’ s co ncer n f or e a s e o fc o m m er ce, a nd the p r a c t i c a ln e e d o fa s e c o nd

ti ercar ri erto b e ab le to tr ust a nd r el y o n agr eem ents i t f o r m s wi tha fi r st
- ti erc ar r i ero n b eh al fo f, o r i n the in te re st of, a ca rg o ow n er . Th ou gh w e re c og n i z e th is congr uence, we m ust a cknowle dge the ve ryl i m i ted ci rcum sta nces in wh i ch the Suprem e Cour t has r eco gnized the n on-trad iti ona l agen cy relation sh ip. T he Cou rt has em plo yed thi s approach excl usi vel y w he re a car ri er and an i nter m edi ar y neg oti ated a m axi m um value f or the t ra nsport ed go ods, abs ent c onse nt fro m the goo ds’ ow ne r. In recog nizing a n a gen cy relationsh ip, th e C ou rt has p r o t e c t e d the s e c o nd

- t i e r c a r r i e r b y l i mi t i ngi ts l i abi l i ty to the o w ner of goo ds dam age d i n tr ansi t t o the val ue nego ti ate d with the i nter m edi ar y. I n contra st, he re ap p ell an ts us e the K -Line bil l of l ad ing as a sw ord to obt ai n i nd em ni fi cati on a nd dam age s fro m Pl ano, ra therthan a s hi el d to avo i d l i abi l i ty. A p p ellant s wis h to hol d Pla no a ccountabl e a s a “ M er chant” that bro ke i t s wa r r a nty r e g a r di ngthe fi tne ss ofi t s g o o ds f o r s hi pm en t. B u t, P lan o w as n ota p ar ty to t h e K -L in e b ill o fl ading, n or di d Pl an o a ctua l l y l o ad th e m o l ds i nt o the cra te. M or eov er, as w e wil lexpl ai n bel ow, ther e i s a questi on o ff act re gar ding the ac tu al r ol e Pl ano pla yed i n obt ai ni ng W or l d’s service s. Rem em ber, Pl ano hi re d CM T to f aci l ita te the purchas e o fthe m ol ds fro m China. W e a re unconvi nced that the K ir byCourtenvi si oned th e re su lt for w h ich ap p ella n ts ad vo c at e. T h ou gh W or ld14 N os. 11

- 2949 & 11

- 2967

was c er ta i nl y a utho r i ze d t o a r r an g e th e m o l ds’ s hi pm en t fro m C h in a to th e U n ite d St at es , w e d ou b t th at i t co u ld mak e g ua r a nt ees on b e ha l fo fP l a no , wh i c h i fb r e a c he d, co ul d s ubj ec t Pl an o t o s ubs ta ntiall i ab i l i ty
. Gi ve n the Suprem e Cour t’ s r est ra i nt i n re cogni zi ng non- trad iti onal age ncy r el ati onshi ps, we are unw i l l i ng to fi nd o ne her e. Ap p e l l a n t s n e x ta r g u e th a tPl an o i s l i ab l e u n d e r th e KL i n e b i l lo fl a di ngb e c a u s e P l a n o a c c e p t e d th e b i l l ’ s t e r ms byi ts c o nduc t th r o ug ho utthe t r an sa ct i o n. Altho ug h a b i l lo fl a di ngi s a c o nt r a c tb e t we e n a shippe r a nd a car ri er, i t ca n non ethel ess bi nd a non- partybuye r w h er e t h er e is co n se n t t o b e b ou n d
. R i c k m ers , 62 2 F. S up p. 2d at71
. Itis und i sputed that Pl ano i s no t a party to the K- Li ne b i l lo fl ading, whi chn am es THI a s th e sh i ppera nd W o r l d a s th e co ns i g ne e. W he th erPl an o can nonethel ess be bound m us t b e deter m i ned by l oo ki ngt o g e ne r a lp r i nc i pl e s o fc o nt r a c tf o r mat i on an d i nt er pr et at i o n. A non- partybuye r m ay accept the t er m s o fthe bi l lo f l adingw here i t fi l es a l aw sui t under the b i l l, and att em pts to be n efitfrom its te rm s. St e e l Ware hous eCo. v. A ba l one Shippi ng Lt d. , 14 1 F
. 3d 234, 23 7 ( 5th C i r. 19 98)
. H er e, i t i s undisp u te d thatPl ano did notfi l e a l aw sui t under th e K -L in e b ill of lad in g, so th is th e or y of lia b ility is f or ecl os ed to appel l ants. A pp el l ants note thatPl ano fi l ed an i nsurance cl ai m to r eco verthe val ue o fthe dam age d goo ds, but presen t no evi dence thatPl ano i n f act sought any benefi ts und er the K

- Line bi l l of l ading in c onn ecti on with i ts cl ai m . M or eov er, appel l ants’ sugg esti o n tha t Pl an o a ccept ed th e bi l lo fl adingb y r ec ei vingN os. 11

- 2949 & 11

- 2967 15 a “ sp ec ial ra te ” o ffer ed by K

- L i n e fo r th e t ra n sp or t is su p p or te d b y no au th or ity an d is no t rele va n t t o t h is det er m i na ti o n. Acc e pt a nc e ma y a l s o b e s ho wn thr o ugh a n a gency re l ati onshi p between the shi pp erand the i nter m edi ary. Ric k m ers , 6 22 F
. S upp. 2 d a t 72
. As di sc us se d abo ve , the no n- tr adit i o na la g en cya na l y si s ar ti cul at ed i n Kir b y i s no t appr o pr i a t e he r e . Th e use o ftr adit i onal ag ency p rinciples to bind cons ignees to bills of ladin g, how ever, w as ca lled int o q u es t i o n b y t h e Su p re m e C ou rt
. K ir by, 54 3 U. S
. a t 34
. In Ki r by, th e C o ur t st at ed th atwhenc o nsi deri ng wh etheran inter m edi ar y c an bi nd a sh ip p erto the t er m s o fa car ri er ’ s bi l lo fl ading, “ re l i ance o n ag en c y la w is m isp lac ed ” b ec au se th e t ra d itio n al in d icia o fa g e n c y, a fi d u c i a r y r e l a t i o n s h i p a n d c o n t r o lb y the pri nci pal, ar e g ener al l y l acking i n re l ati onshi ps bet w een c ar go ow n er s a n d freig h t fo rw ar d er s. Id
. To th e ex te nt th atthi s an aly si s i s pr o pert o de te r m i ne whethe r the s h i p p e r a c c e pte d th e t e r ms o fth e b i l lo fl a d i n g, we ag r ee wi th th e di st r i ctc o ur t th atW o r l d was no t ac ting as Pl ano’ s a gent. U nd era tr adit i onalanal ysi s, an a gency re l ati onshi p re quir es a m ani fest ati on bythe pri nci pal to th e ag en t th atthe a g en t m aya cto n h i s ac co unt, c o ns en t by the a gent to so act, and the pow erbythe pri nci pal to contr olthe age nt’ s condu ct r ega rdi ng the entrusted m at te rs . Aldr ige, 6 42 F. 3d at 541. H er e, the age ncy t est m ust f ai lbec ause Pl an o d i d not hav e the power t o contr olW or l d. A s we dis cuss b el ow, the rec or d i s uncl ear r e g a r di ngwh a tr o l e P l a no pl a y e d in e ng a g i ngWo r l d. M or eover , Pl ano did notdi re ct W or l d as t o w hi ch shi pp erto se l ect, o r how to co nd uct i ts b u sin es s. Though16 N os. 11

- 2949 & 11

- 2967 Pl ano had a r el ati onshi p w i th K-Li ne, the re cor d does not i nd i cate thatPl ano dem anded thatW or l d contr act w i th K-Li ne, m u c h l ess TH Io r U ni on Paci fi c. A pp el l ants poi nt to no f act i n the re cor d w hic h c onvinces us that Pl a no h a d the ab i l i t y t o , o r di d, c o nt r o lWo r l d. F o r the f o r eg o i ngrea so ns , Pl an o c anno t be he l d t o the ter m s o fthe K

- Line bi l lo fl ading
.
2 . T he Worl d B i l l o fL a di ng Turningto appel l ants’ fi naltheo ryo fco ntra ct l i abi l i ty, as se rt in g t h at P lan o is b ou n d to th e t er m s o f th e W or ld bi l lo fl a di nga s a c o nt r a c t i ngp a r t y, we mus tc o ns i der Pl ano’ s r ol e in obt ai ni ng W or l d as the fre i ght for w ar der f orthe m ol ds’ tr anspor tat i on . A pp el l ants ar gue that P lan o w as a p arty to the cont ract, and w as th erefore aw ar e o fand acce pted the t er m s o fthe W or l d bi l lo f l ading
. Pl ano m ai ntai ns thati t was CM T that contr acte d wi thW o r l d, a nd tha t i ts r o l e was l i m i te d to a mer e uni nvolved pu rch aser. Th e im p ortan ce of this f actu al dete rm i na ti o n c anb e se eni n R ick m ers . In R ick m ers , an inj ured car ri erso ught t o h old a purchase r ofgo ods l i abl e under bi l l s o fl adinga ss er tingtha t th e pur ch as erwas the ul ti m at e co ns i g ne e of the g o o ds an d fi t wi th i n the b ills’ d efin itio n of “M er c h an t.” 6 2 2 F . Su p p . 2d at71 . In rej ecting the ar gum ents ofthe car ri er, the Rickm ers c ou rth eld th at th ou gh th e p u rc h as er likely fell w ith in th e b ro ad sc o p e o f th e M er c h an t c lau se co n ta in ed in the b i l l s o fl ading, the pu rchas erwas not a par ty toN os. 11

- 2949 & 11

- 2967 17

I n R i ckm ers , th e p u rc h a se r, E S M G ro u p , b o u g h t S S -8 9 , a 3 desulphu ri zing re agent i n st eel m aking, from i ts w holl y-own ed s ubs i di ar y, ESM T. W hi l e enr out e on the hi gh s eas, the goods al l eg edl y c aus ed an ex pl os i on on boar d the t ra ns por t i ng ves s el
. ESM T ar ra nge d f or th e SS

- 89 t o be s hi pped t o the U nited States. Th e c a r r i er asserte d a b rea ch of con tract cla im a g a i n s tth e b u y e r , E S M Gr o u p , wh o h a d n o h a n d i n a r r a ngi ng the tran sp or t. T he cou rt d ecline d to find E SM G r o u p l i ab le to the c ar ri erbe c aus e i tw as no t a par t y t o the bi l l ofl adi ng, no r d id it c o n se n t to b e b o u n d
. Id
. at71
. The re , the b ill o f l adi ng con tain ed a p ro v ision stating tha t b ro ad ly de fined “m erch an ts” would i ndem ni fy the c ar ri erag ai ns tan y c l ai m or l os s ar i s i ng o u t o f th e c a rr ia g e o f d a n g er o u s g o o d s. e i the r b i l l, n o r di d i te v e r c o ns e ntt o be b o un d. Id
. at72

- 73. 3 Tho ug h R ick m ers , as a dist ri ct c ourtdeci si on i s no t bi nd i ng her e, we n on ethel ess fi nd i ts anal ysi s per suasi ve. Pl ano si m i l ar l y a rgues that i t was r em oved fr om al lshipping ter m s be cause CM T hand l ed the tr anspor tati on o fthe m ol ds fro m China to the Unite d Sta tes
. The dis tr i ct c ourtfound i t undis pu ted thatCM T, not Pl ano, “hi re d ” W orl d, and the co urt deter m i ned that CM T w as not Pl an o’s age nt, but a br oke r that fi l l ed i ts or d er . Accordi ngl y, Pl ano w as not a par ty to the W orld bi l lo fl ading
. The d i str i ct c ourtal so concl ud ed that Pl an o co ul d no t be bo und by th e W o r l d bi ll of ladi ng because i t di d not neg oti ate i ts ter m s o r see k b enefi ts un d er i t. Appel l an ts , ho wev er, mai nt ain tha t Pl an o c o ntr acte d with W or l d di re ctl y, or i n the al ternativ e, that ther e a re fa c ts s u ffi ci ent t o cre ate a questi on o ff act as to th i s i ss ue . The r es o l ut i on o fthi s que st i o n i s i m po r ta nt18 N os. 11

- 2949 & 11

- 2967 be ca us e i fPl an o e ng ag ed W o r l d t o ha ndl e th e sh i pm en t o n i t s o wn b e h a l f, i t c o u l d b e f o u n d l i ab l e t o K- Li ne an d U n ion P ac i f i c by th e p lain te rm s o f th e W or ld bill ofl ading
. Contr ar y t o the c oncl usi on o fthe d ist ric t co urt, w e fin d th e e vid en c e s u rro u n d in g t h e P lan o-C M T -W or ld tr ansact i on m urkyatbe st , a nd co ncl ud e that co nfl i cts i n the re cor d re ga rd i ng thi s point cr eat e a m ate ri alquest i o n o ff a c tr e qu i r i ngr e man d. There ar e s eve ra lf acts wh i ch w ei gh o n the de te rm in atio n o fPl ano’ s r el ati onshi p w i th W or l d. I t i s undis pu ted that Pl ano sel ecte d W or l d as i ts f or w ar der, and i nstr ucted C M T to c o n ta c t W or ld reg ar d in g t h e s h ip m en t. B u t e vid en c e s u g g e s ts th at it w as P lan o, n otC M T , th at ac tu ally ar ra ng e d the s hi pme ntwi th W o r l d. T he r e c o r d a l so i ndi ca te s th atit was Pl an o ’ s o bl i g at i o n t o a r r an g e th e m ol ds’ tr anspor tat i on. Fi rs t, S am uelW u ofCM T tes ti fi ed that Pl ano shi pp ed the m ol ds to the U ni ted S tat es “FOB Shanghai
. ” Un der that t erm , Pl ano, notCM T, was re sponsibl e forar ra ngi ng shi pm ent. A l so consi ste nt with th i s te r m , the W o r l d b i l lo fl adingl i st ed Pl an o a s th e con signe e. W u c o nfi r m ed i n h i s depo si ti o n tha t Pl an o did ar ra nge the m ol ds’ tr anspor ta tio n. Pl ano executi ve Yun gersi m i l ar l y c onfi rm ed that w hen a m ol d i s s hi p p ed FOB, the e nti ty m aking the ord er a rr anges f orthe goo ds’ tr an spo r ta ti o n. He de ni es , ho wev er, that Pl an o ha d a ny ro l e in ar ra ngi ng the shi pm ent forthe m ol ds at i ssue. T h is a ss e rt ion is co n tr ad ict ed by W em b er of W or ld who t e s t i fi e d tha tCMT h a d n o r o l e i n b o o ki ng the s hi pm ent, and thatW or l d had no dir ect deal i ngs with CM T; i nstea d, he deal t di re ctl y with Yun geratPl ano. W em beral so tes ti fi ed thatYunger i ni ti al l y c ontac tedN os. 11

- 2949 & 11

- 2967 19

T he shi p p i n g te rm FC L ind icates th at all car g o b elon g s to 4 o n e c o n sig n ee , a “ fu ll c o n ta in er lo a d .” W or l d reg ar ding the m old s’ shi pm ent a nd poi nts t o an em ail se n t b y Y u n ge r to W em b er , cop yin g C M T rep re senta
t i v e s , wh e r e Y un g e r st ate s “ Iwa ntt o s hi p the mo l ds FCL i n ter m s t o shi pp erwh er e F O B S hanghaiwe can us e a 20

- f o o t co nt ainer. Pl ea se a r r an g e sh i ppi nga nd bi l l i ng with EnJ i nn, CM T a n d /or Pl ano sam e a s l ast m old s e x c ep t t h es e m old s a re from C h in a.” 4 A se r i es of e m ai l s se ntb etwee n Yun g er, W embe r, a nd S ha h r ai se questions r eg ar di ngthe t r ue t er m s o fthe sh ip m en t. In o n e e m ail, Y u n ge r as ke d W or ld to be gin ar ra ngi ng the shi pm en t un der F OB te rm s. W or l d then re pli ed that the s hi pm ent s houl d be m ade DD P and not FO B
. Th e pa rties app ear to agree to alter the d eli very te r m s, wi thW embe r e m pha si zingthat c or r ec t sh i ppi ng ter m s were param ount be cause “ifanythi ng were to happ en i n tr ansi t y ou want yo ur p ap er w or k t o re fl ect th e true t er m s. ” Des pi te the se e m ai l s, the b i l lof l ading r efl ec ts F OB s hi ppi ngt er m s, l i st i ngW o r l d a s th e co nsi gnee. The shi pp i ng t er m s a re si gni fi cant in ter m s o f o w n er sh ip . U n d er an FO B arr an ge m en t, P lan o w ou ld ta k e o wner sh i p o nc e t he car g o g o es o ve r the r ai lo fthe shi p. U nd era DD P ar ra ngem en t, Pl ano w oul d onl y t ake o wn e r s h i p w h e n th e g o o d s a r r i v e d a ti t s d o o r, a n d C MT w as re sponsibl e fortr anspor ti ng the go ods t o I l l i noi s. Alth o u g h th e Wo r l d b i l l o f l a d i n g i n d i c a t e s th att he goo ds w er e s hi pp ed FOB, W em berte sti fi ed that thi s was an er ro r. H e cl aim s that the true purchase te rm s be tw een20 N os. 11

- 2949 & 11

- 2967 Pl ano and C M T w er e DDP , and that CM T, notP l ano, shoul d have be en l i ste d as the co nsi gnee on W or l d’s bi l lo f l ading ; however, he a dm i tte d that no co rr ecti on o r c h an ge w as ev er m ad e. Fu rt h er co m p lica t in g m at te rs is th at C M T se n t P lan o a n inv oic e d at ed Ju ly 1 4, 2 00 5. T h is in vo ice ch ar ge d P lan o for th e p ric e o f th e m old s, as w ell a s s h ip p in g; C M T p aid W or ld d ire c tly for c er ta in sh i ppi ngco st s, b i l l i ngPl an o l at er . CM T a l so pa i d the i m portduty and c u st om cl ear ed ser vi ce c harg e, and then i nvoi ced Pl ano. These f acts sugg est D DP shi pp i ng te rm s, whe r e b y CMT, r a the r tha n Pl a no , wo ul d ma k e the s hi pping ar ra ngem ents. On this r eco rd, we are unab l e t o asce rt ai n w hether CM T orPl ano ar ra nged the m ol ds’ shi pm ent with W o r l d. Wi tho utthi s de t er m i na t i o n, we c a nn o tc o nc l ud e w hethero r not Pl ano e n ga ged W or l d i n a m anner that woul d i m po se l i ab i l i tya s a co nt r ac tingpa rty, a nd subj ect Pl ano to l i abi l i ty und erth e W or l d bi l lo fl ading
. A s t o thi s na r r o w i ss ue , we r ev er se the di st r i ctc o ur t’ s grant o fsum m ar y j ud gm ent a nd r em and fo r further co ns i der at i o n.
B . N e g l i g e n c e C l a i ms A pp el lan ts as ser t that the tr ai n derai l m ent was ca used by the inadequ ate packing a n d braci ng o fPl ano’ s m ol ds. A c c or d in gly , th ey m ain ta inth a t P lan o m ay be h eld liab le for d am ag es ca u se d by th e a c c id en t b ec au se it owed the car rie rs a du ty to supp l y a pro perl y pack ed conta i ner. A pp el l ants seek to i m pose thi s duty o n Plan o arguin g tha t: (1) it w as on notice of the carrier’sN os. 11

- 2949 & 11

- 2967 21 in ab ility or in c om p et en c e t o p ro p er l y p a c k g oo d s; (2) it ha d “ un i qu e kno wl e dg e ” o f“ i nh e r e ntr i s k s ” p r e s ented b y th e m old s an d faile d to w ar n of th e fo r es ee ab le dan g er ; ( 3) Pl an o e xe r ci se d s ub st an ti alc o nt r o lo ve r the m ol ds’ shi pm ent; and ( 4) Pl ano i s l i abl e forW or ld ’s acts bec au se W o r ld acted as Plano ’s agent
. Th e d istri ct cou rt di sa g r ee d a nd f o und n o e vi den ce t o s ug g es t th atthe p arties w ho p acke d and ship p ed the con tainer w ere unabl e to do s o pr o per l y, o r tha t Pl an o was a war e o fa ny ri sk i nherentto shi pp i ng the m ol ds . It al so deter m i ned th atPl an o e xe r ci se d no c o nt r o lo ve r W o r l d o r THI, a nd f ound no ag ency re l ati onshi p. W e a ffi rm t h e d i str i ct cour t’ s fi nd i ng r ega rdi ng neg l i gence . U n d er fed er al m ar i tim e la w , bu ye rs d o n otty p ica lly owe carrie rs and fel l ow carg o own er s a duty o fcar e. A sl anidis v. U
. S. Lines, Inc. , 7 F.3 d 1067, 1077 (2d Cir. 1 9 9 3 ) ( “ [ I ] mpo s i ngl i ab i l i t y o n the p urc ha s e r o fg o o ds w oul d be both unj usti fi ed and i l l ogi cal
. ”)
. Thi s i s be cause “[ a] s be twe enc ar r i er, s hi pper, a nd c ons i g ne e, the c o nsignee w ou ld be least li kely to posse ss th e nec essary k no wl edg e to ha ve a vo i ded an y di ffic ul tya r i sing fro m im properpacka gi ng. ” Atk i n s K r o l l & C o . v . Ke d l l oyd L i ne, 210 F. Sup p . 315, 317 (N
. D
. Ca l. 1962). H ow ever, so m e co ur ts ha ve he ld th ata di ffer en t r ul e m i g ht o bt ain whe r e th e buy erha d uni qu e k now l edg e o fthe kn ow n risk s a s s o c iat ed w ith its p ro d u c t. R ick m ers , 62 2 F. Supp.2d a t 6 5. Fur ther, a buyerm i ght b e s u b j ect to l i ab i l i t y i f i t wa s o n n o t i c e o f s o me i n c o mpe t e n c e o n t he p a r t of th e s h ip p er . Id
. A du ty m ay be foun d w he re harm i s r eas onabl y for ese eab le. S ch ur v . L.A . Weigh t Lo ss C ent ers, Inc. , 577 F. 3d 752, 766 ( 7th Cir
. 2009 ). W e fo cus,22 N os. 11

- 2949 & 11

- 2967 then, o n w hetherthe derai l m en t w as re aso nabl y for ese eab l e g i v e n Pl a no ’ s de c i s i o n t o us e W o r l d, o r b e cause of the inherentr i sk ofshi pp i ng the m ol ds. I t was not
. Fi rs t, we exam i ne wh etherthe re cor d sugges ts that P lan o w as on n ot ice th at W or ld w as inc ap ab le of s af ely and effecti vel y t ra nsport i ng t h e m ol ds. A s a n i ni ti al m at te r, the r ecord i ndi ca te s th atKuns ha n l o ade d the m o l ds i nt o woo denc r at es , K- Li ne s uppl i ed a sh i ppi ng c o n t a i n e r, a n d T HIl o ade d th e c r a t e s i n t o th e KL in e c on ta in er . P lan o d id n otac tiv ely p ar tic ip at e in l oadi ng the m ol ds. M or eov er, Pl ano had n o rea son to q u es ti on the co m petence ofW or l d, K unshan, o r TH I. W or l d had shi pp ed m ol ds to Pl ano tw enty to thi rty t i m es p re vio u sly

— ther e is n o evi dence thatPl ano eve r had any pr obl em s with W or l d’s perf or m an c e, orthat W or l d’s perf or m ance w as e vernegl i gent ordefecti ve i n a ny way . F ur th er m ore, the r e i s no th i ngt o hinta t an y pri orkno w led ge ofi ncom petence on the par t o f K u n sh an or T H I. N ex t, we co ns i der whethe r Pl an o ha d an y uni que k no wl edg e r eg ar di ngthe ri sk s i nhe r en t i n t r an spo r tingthe mol ds
. App e l l a nt s s ug g esttha tt r a ns po r t i ngthe mo l ds posed a hei ghtene d ri sk because o fthe “co ncentr ate d f oo tpri nt” o fthe m ol ds; the m ol ds w er e s m al li n si ze, co m par ed to the i r wei g ht
. Gi ve n thi s f oo tpr i nt, Pl an o al l eg edly s ho ul d ha ve a cc o unt ed f o r the wei g htdi st r ibuti on withi n the conta i ners . Thou gh appel l ants ci te to seve ra lcas es to show that Pl ano had a du ty to w ar n, unl i ke th o se c as es , the s te elmol ds ati ss ue he r e co nt aine d no i nherentr i sk s u c h as toxi c co ntam i nati on, expl osi on, o rN os. 11

- 2949 & 11

- 2967 23 sp on ta n eo u s c om b u st ion
. Edw a rds v
. Cal i f or ni a Che m i ca l Co. , 2 45 S o . 2d 25 9 ( F l
. Ct
. App. 1 97 1) ( sh i pm en t o fOr th o St andard Lead A rs enate , a “hi ghl y t oxi c” pr oduct r equir i ng user s t o “w earpro tect i ve cl othi ng a n d em plo y a re sp i r at or ”); B a rney v. B urn tsenbin der, 64 Barb. 21 2 ( 18 72 ) ( cargo ofhi g hl y e xpl o si ve ni tr o g l y ce r i ne )
. To the ex te nttha t appe l l an ts c l ai m tha t th e we ight o fthe m ol ds m ade them danger ous, the evi dence d oes not supp or t the co ncl usi on that Pl ano had speci fi c know l edge ab o ut the “ we i g ht o f the s t e e l mol ds a nd the ri sk of shi pp i ng [ the] m ol ds w i thout the a pp ro pri ate use o f bl o ck i ng, br ac i ng, o r l o ad spr ea di ng m at er ial
. ” The w ei ght o fthe m olds was fully di scl ose d on the f ace of both the W or ld and K-Line bi l l s o fl ading, and no par ty has quest i oned the accura cy ofthe w eig ht as r eco rded on these docum ents. Though Pl ano did se lec t the si ze ofthe conta i ner beca use itbel i eve d the c om bi ned w ei ght o f the m ol ds did notexce ed the c ontainer’ s ca paci ty, nothi ng sug ges ts that Pl ano w as aw ar e o fany ri sk prese nt ed bythe s i ze o fthe c o nt aine r . M o r eover, K- Li ne i tse l fsuppli ed the conta i ner. Final l y, appellants agr ee that the wei ght o f the m ol ds w as w i thi n the w ei ght c apacity ofa prop erly m aintain ed 20-foot K -Line cont ainer. A pp el l ants al so m ai n ta in thatthe derai l m ent that occur re d i n Okl ahom a was f or ese eabl e, and ci te to R ega lB el oitfor s u p p or t. 13 0 S .C t. at 24 48 . Th is re fer en c e is m i spl ac ed. In R egal- B el oit, the Court d id not e val uate the know l edge o fany partyo r evaluate w hetheri t was f or ese eabl e that the m ol ds them sel ves w oul d bre ak thro ugh thei r cra tes
. Instea d, th e Cour t s i m plyo bser ved th a ti tw a s a “ f o r e s e e ab l e e v e n tth a tc a r g o m i g htb e d a m-24 N os. 11

- 2949 & 11

- 2967 age d du ring ca rr i age . ” Id. A s w e e x p lai ne d above, there i s n o e v i d e n c e t o s h o w th a t i t wa s f o r e s e e ab l e th att he m ol ds w oul d bre ak thro ugh thei r cra tes a nd cause a der ai l m en t, a nd the Co ur t ce r ta i nl y w as nots ug g es ting th atPl an o sho ul d ha ve f o r es ee n tha t su cha n a cc i den t wo ul d h a v e t r a ns pi r e d. F i na l l y, a ppel l an ts a r g ue tha t P lano was l i ab l e f o r the al l eg ed ne g l i g en ce o f W o r l d an d THI be ca use ap par en t author i ty cre ate d an agency r el ati onshi p between Pl ano and W or l d, and because Pl ano exer ted subst an ti al c o nt r o lo v e r Wo r l d a nd T HI du r i ngthe s hi pp i ngp r o cess . As we co nc l ude d pr ev i o us l y, W orl d was no t ac ting as Pl an o ’ s ag en t, a nd a ppel l an ts ’ a sserti o n o fa ppar en t author i ty does not alt er o ur co ncl usi on. A pp el l ants a r g u e th a t P l a n o ’ s a c t o f g i v i n g Wo r l d th e s t e e l mo l ds f o r s hi pme nt c l o a k e d W o r l d wi th a pp a r e nt a utho r i ty to ac t o n P l an o ’ s be ha l f
. B ut P l an o c i te s to no th i ngi n the re cor d to show that K-Li ne o r U n ion P acifi c be l i eve d that W or l d w as acting as Pl ano’ s a gent. M or eov er, as no t e d sup ra , Par t I I
. A
. 2, ther e i s a q u esti on o ff act re gar ding w hetherPl ano orCM T engag ed W or l d as a c on tr ac tin g p ar ty
. The re cord si m plydoes notsupport the a sse rt i on th at P lan o e x er c ise d s u b st an tia l c on tr ol ov er eith er W or ld or T H I d u rin g t h e s h ip p in g p ro c es s. A s t o W or ld , ap p ell ants poi nt to th e fa ct that Pl ano “or dered” W or l d to shi p the m ol ds “FCL”, thatPl ano provi ded W or l d w i th the speci fi cati ons of the m ol ds, and that Pla n o in str ucted CM T on wh en to i ni ti ate the sh ipp i ng pro cedure. These few i ns truct i o ns , ho wev er, d o no t sh o w tha t Pl an o “ co n-N os. 11

- 2949 & 11

- 2967 25 tr olle d ” W or ld . Ra th er , P lan o s im p ly p ro vid ed ba sic i ns t r uc t i o ns t o Wo r l d r e g a r di ngthe mo l ds ’ s hi pm ent. Pl ano di d n o ti ns t r uc tWo r l d o n whi c h c a r r i e r s to em plo y, and no Pl ano em plo yee s h ad any c om m unica

ti o ns wi thTHI, the c o m pan y that c arri ed o utthe l oadi ng and st owage o fthe m ol ds. P l a n o h a d n o i n d i c a t i o n th a tWo r l d, Ku n s h a n, o r T HI w oul d be unabl e t o prop erl y pack age and tr anspor t i ts st ee l m old s f r o m C h in a t o th e U n ite d Sta te s, n or d id Pl an o ha ve a ny s pec i alkno wl edg e of a ny uni que d an ger the m olds w ou ld p ose d uring trans it. M oreover, Pl ano did notf or m an a gencyr el ati onshi p w i th ei ther W or l d orT H I. A ccor dingl y, Pl ano owed no speci al d u ty of car e t o the c ar ri er s, and cannot be he l d l iab le f ornegl i gence .
I I I . Concl usio n Forthe f or ego i ng r easons, we R EVER S E the di str i ct c o ur t ’ s g r a nto fs ummar y j ud g men ta s t o a pp e l l a nts’ co nt r ac t cl ai m s ba se d o n the W o r l d b i l lo fl adinga nd R EM AND for fu rt h er d isp os itio n co n sis te n t w ith th is o p i n i o n . We A FFIRM the d istri ct cou rt’s grant of sum m ary j ud gm ent a s t o appell ants’ negl i gence cl ai m s.

8- 29- 12