1

IN THE UNITED STATES DISTRICT COURT

FOR THE WESTERN DISTRICT OF PENNSYLVANIA

ACCU-SPEC ELECTRONIC SERVICES, )

INC., )

Plaintiff, )

)

v. ) Civil Action No. 03-394 Erie

)

CENTRAL TRANSPORT )

INTERNATIONAL, et al., )

)

Defendants. )

MEMORANDUM OPINION

McLAUGHLIN, J.

Presently pending before the Court is the Defendant, Central Transport International, Inc.’s

Motion for Summary Judgment. 

I. BACKGROUND

Plaintiff, Accu-Spec Electronic Services, Inc. (“Accu-Spec”), is a Pennsylvania corporation

with its principal place of business in McKean, Pennsylvania. (Complaint ¶ 1). In the course of its

business, Accu-Spec purchased an x-ray machine from Dage Precision Industries (“Dage”) of

Fremont, California. In January of 2003, Accu-Spec engaged Logistics Plus, Inc. (“Logistics Plus”)

to transport a crate containing the x-ray machine from Dage to Accu-Spec’s facilities in McKean.

(Complaint ¶ 6; Appx. Ex. A). Logistics Plus, a New York corporation, offers a full range of

logistics services including freight forwarding and shipment consolidation. (See Logistics Plus

website, Appx. Ex. F; Complaint ¶ 3). Indeed, Logistics Plus is licensed as an international freight

forwarder. Id. 

After agreeing with Accu-Spec upon a rate for transportation of the machine, Logistics Plus

issued its own bill of lading setting forth the terms governing the shipment of the machine from

Fresno to McKean. (Logistics’ Answer ¶¶ 29, 38; Appx. Ex. B, C and D). Logistics Plus then

entered into an agreement with a carrier, Defendant Central Transport Internation, Inc. (“Central”),

to physically transport the machine from origin to destination. (Complaint ¶ 7; Appx. Ex. D). In the

course of negotiating the transport of the machine, Accu-Spec and Central both dealt exclusively

with Logistics Plus. (George Horetsky Affidavit (“Horetzky Aff.”) ¶ 6; Appx. Ex. E). 

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Central picked up the x-ray machine from Dage on February 5, 2003, and delivered it to

Accu-Spec’s facility on February 14, 2003. (Complaint ¶¶ 8-9; Apps. Ex. A). Upon arrival and

inspection, Accu-Spec immediately noticed that the crate containing the x-ray machine was

damaged. (Complaint ¶ 15). A subsequent inspection by an independent investigator confirmed that

the x-ray machine had been damaged. (Complaint ¶ 17). After filing claims with both Central and

Logistics Plus, Accu-Spec filed the instant suit seeking damages under 49 U.S.C. § 14704 and §

14706.

On October 14, 2004, Central filed the instant motion for summary judgment. On November

15, 2004, Accu-Spec and Logistics Plus filed briefs in opposition. On November 30, 2004, Central

filed a responsive brief. This issue is thus ripe for resolution. 

II. STANDARD OF REVIEW

Summary judgment is proper “if the pleadings, depositions, answers to interrogatories and

admissions on file, together with the affidavits, if any, show that there is no genuine issue as to any

material fact and that the moving party is entitled to judgment as a matter of law.” Fed.R.Civ.P.

56(c). In order to withstand a motion for summary judgment, the non-moving party must “make a

showing sufficient to establish the existence of [each] element essential to that party’s case, and on

which that party will bear the burden of proof at trial.” Celotex Corp. v. Catrett, 477 U.S. 317, 322

(1986). In evaluating whether the non-moving party has established each necessary element, the

Court must grant all reasonable inferences from the evidence to the non-moving party. Knabe v.

Boury Corp., 114 F.3d 407, 410, n.4 (3d Cir. 1997) (citing Matsushita Elec. Indus. Co. v. Zenith

Radio Corp., 475 U.S. 574 (1986)). “Where the record taken as a whole could not lead a reasonable

trier of fact to find for the non-moving party, there is no ‘genuine issue for trial.’” Id. (quoting

Matsushita, 475 U.S. at 587).

III. DISCUSSION

A. 49 U.S.C. § 14706

In 1906, Congress codified common law principles relating to the liability of interstate

carriers in the Carmack Amendment to the Interstate Commerce Act. See Tokio Marine & Fire Ins.

Co v. Amato Motors, Inc., 996 F.2d 874, 876 (7

th Cir. 1993). Effective January 1, 1996, the

Carmack Amendment was recodified as part of the Interstate Commerce Commission Termination

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Act of 1995, 49 U.S.C. §§ 11706 and 14706. Section 14706 governs the liability of motor carriers

and freight forwarders for freight loss or damage:

(a) General Liability - 

(1) Motor carriers and freight forwarders. –A carrier

providing transportation of service subject to jurisdiction under

subchapter I or III of chapter 135 shall issue a receipt or bill of lading

for property received for transportation under this part. That carrier

and any other carrier that delivers the property and is providing

transportation or service subject to jurisdiction under subchapter I or

III of chapter 135 or chapter 105 are liable to the person entitled to

recover under the receipt or bill of lading. The liability imposed

under this paragraph is for the actual loss or injury to the property

caused by (A) the receiving carrier, (B) the delivering carrier, or (C)

another carrier over whose line or route the property is transported in

the United States . . .

* * * * * * * *

Failure to issue a receipt or bill of lading does not affect the liability

of a carrier. A delivering carrier is deemed to be the carrier

performing the line-haul transportation nearest the destination but

does not include a carrier providing only a switching service at the

destination.

49 U.S.C. § 14706(a)(1). 

Consistent with this section, there are generally two parties against whom a claim for freight

damage can be brought: (1) the carrier that issues the bill of lading, and (2) the “delivering carrier”

that physically drops the goods off at the final shipping destination. Id. See also S.C. Johnson &

Son v. Louisville & Nashville Railroad Co., 695 F.2d 253, 256-57 (7th Cir. 1982) (“To claim the

benefits of the Carmack Amendment a shipper must sue either the carrier issuing the bill of lading

or the carrier delivering the goods to the final destination.”). The statute further specifies that a

claim against either of those parties can encompass damage caused by any of the carriers used to

transport the freight. 49 U.S.C. § 14706(a)(1). See also S.C. Johnson, 695 F.2d at 256-57; Tokio

Marine & Fire Ins. Group v. J.J. Phoenix Exp., 156 F.Supp.2d 889, 894 (N.D. Ill. 2001) (noting that

“a shipper is entitled to relief from either the carrier issuing the bill of lading or the carrier delivering

the goods to the final destination (either of these carriers will be liable for loss caused by any carrier

used during the trip); and then, the carrier held liable to the shipper may, in turn, seek recovery from

the carrier, which was responsible for the loss.”). In this manner, the Carmack Amendment seeks

to “relieve shippers of the burden of searching out a particular negligent carrier from among the often

numerous carriers handling an interstate shipment of goods.” Reider v. Thompson, 339 U.S. 113,

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 The statutory definition of a “freight forwarder” is:

[A] person holding itself out to the general public (other than as an express,

pipeline, rail, sleeping car, motor, or water carrier) to provide transportation of

property for compensation and in the ordinary course of its business - 

(A) assembles and consolidates, or provides for assembling and

consolidating, shipments and provides for break-bulk and distribution

operations of the shipments;

(B) assumes responsibility for the transportation from the place of receipt

to the place of destination; and

(C) uses for any part of the transportation a carrier subject to the

jurisdiction of the Interstate Commerce Commission under subchapter I,

II, or III of chapter 105 of this title.

49 U.S.C. 13102(8). 

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119 (1950). 

When freight is shipped with the assistance of a “freight forwarder,” the Carmack

Amendment provides additional standards. A freight forwarder is an entity that collects several

small shipments of cargo from various shippers, charges each of them a rate for transport from

shipping point to destination, and then profits by consolidates the cargos to combine costs.1 See

Chicago, Milwaukee, St. Paul & Pac. R. Co. et al. v. Acme Fast Freight, Inc., 336 U.S. 465, 484-85

(1949). Section 14706(a)(2) of the Carmack Amendment provides that:

A freight forwarder is both the receiving and delivering carrier.

When a freight forwarder provides service and uses a motor carrier

providing transportation subject to jurisdiction under subchapter I of

chapter 135 to receive property from a consignor, the motor carrier

may execute the bill of lading or shipping receipt for the freight

forwarder with its consent. With the consent of the freight forwarder,

a motor carrier may deliver property for a freight forwarder on the

freight forwarder’s bill of lading, freight bill, or shipping receipt to

the consignee named in it, and receipt for the property may be made

on the freight forwarder’s delivery receipt.

49 U.S.C. § 14706(a)(2). The United States Supreme Court described the common law principles

pertaining to a freight forwarder’s liability as follows:

[When] the shipment had been entrusted to a forwarder . . . who

contracted to deliver the goods to the consignee at rates set by itself

. . . the forwarder was subjected to common carrier liability for loss

or damage whether it or an underlying carrier had been at fault. The

fact that the forwarder did not own the carriers whose services it

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It is disputed between the parties whether Logistics Plus is or acted as a freight

forwarder in the course of the underlying shipping transaction. However, because

we conclude that the liability of a freight forwarder under the Carmack

Amendment is not exclusive, infra, we need not resolve that issue.

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utilized was held to be immaterial. Its undertaking was to deliver the

shipment safely at the destination. Common carrier liability was the

penalty for failure of fulfillment in that undertaking.

Chicago, 336 U.S. at 484-85. One of the purposes of the Carmack Amendment was to codify those

common law principles into a uniform federal standard for liability. Id.

Thus, the Carmack Amendment provides a straightforward remedy for a shipper whose

freight has been damaged while under the oversight of a freight forwarder. The shipper may sue the

freight forwarder and recover for the full amount of the loss without having to ascertain which of the

common carriers used by the forwarder, most of whom the shipper has never communicated with,

damaged the shipper’s freight. The issue before us, however, is whether a freight forwarder’s

liability under the Carmack Amendment is exclusive.2

Central argues that, where a “freight forwarder” is utilized by a shipper to transport cargo,

the shipper’s only remedy for lost or damaged freight is against the freight forwarder. Central relies

on the relationship between the first sentence of § 14706(a)(2), which states that “[a] freight

forwarder is both the receiving and delivering carrier,” and the plain language of § 14706(a)(1),

which places liability for lost or damaged freight on either the carrier that issued the bill of lading

or the delivering carrier. Blending these provisions, Central argues that Accu-Spec may look to

Logistics Plus as the purported freight forwarder and that Central’s dismissal, therefore, is

appropriate. For reasons discussed more fully below, we find no support for Central’s argument in

either the statutory language or relevant caselaw. 

First, we note that 49 U.C.C. § 14706 is completely silent as to whether a freight forwarder’s

liability under the Carmack Amendment is exclusive, despite the presence of several elaborate

provisions describing the relative liabilities and responsibilities of common carriers and forwarders

in shipping. In short, if it was Congress’ intent to restrict liability to freight forwarders in the manner

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suggested by Central, it could have said so. Indeed, although Section 14706(a)(1) is subtitled “motor

carriers and freight forwarders,” that provision does not differentiate between the two when

discussing liability, noting only that both the carrier issuing the bill of lading “and any other carrier

that delivers the property” are liable for damaged freight. 49 U.S.C. § 14706(a)(1) (emphasis added).

Moreover, the few courts that have confronted this issue have unanimously interpreted §

14706 as creating a cause of action for a shipper against both a freight forwarder and the underlying

common carrier. See, e.g., Gulf & Western Indus., Inc. v. Old Dominion Freight Line, Inc., 633

F.Supp. 688, 691-92 (M.D. N.C. 1986) (answering in the affirmative the “question [of] whether any

action exists in favor of a customer of a freight forwarder against an underlying carrier upon whose

line the goods were damaged.”); Beautifax, Inc. v. Puerto Rico Marine Mgmt., 611 F.Supp. 537, 543

(D. Md. 1985) (concluding that both the freight forwarder and the common carrier who physically

delivered damaged freight were proper defendants under the Carmack Amendment); Phoenix

Assurance Co. v. K-Mart Corp., 977 F.Supp. 319, 324 (D.N.J. 1997) (noting that “an initial common

carrier is liable to the shipper” and implying that “a ‘freight forwarder’ is also liable” under the

Carmack Amendment) (emphasis added). In Gulf & Western, the court relied upon the Supreme

Court’s opinion in Chicago to support this result:

The Supreme Court in the Chicago case had occasion to discuss the

relationships among customers, freight forwarders, and carriers. The

Supreme Court indicated that shippers by freight forwarder are

“permitted to sue underlying carriers for loss or damage occasioned

by the latter.” Regarding the nature of the freight forwarder’s action,

the Court stated: “[t]he theory of these actions was that the shipper is

the undisclosed principal of its agent, the forwarder, in the latter’s

contract with the carrier.” Under this view of a customer-shipper’s

action, the customer would be bound by the terms of the carriage

contract between the freight forwarder and the carrier.

Gulf & Western, 633 F.Supp. at 692 (quoting Chicago, 336 U.S. at 487 n. 27). Thus, the caselaw

and the clear language of the statute both refute Central’s position. Indeed, Central, through its

counsel, conceded at oral argument that it was unaware of any caselaw supporting the proposition

that a freight forwarder’s liability under the Carmack Amendment is exclusive. (See Transcript of

Hearing on Defendant’s Motion for Summary Judgment, pp. 15-16). 

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A few additional comments concerning the Supreme Court’s opinion in Chicago are

warranted. In the course of discussing the applicability of the Carmack Amendment’s subrogation

provision to freight forwarders, the Court quoted a statement from Representative Wolverton, a

member of the committee that drafted portions of the Carmack Amendment, indicating that the

drafters may have intended the result that Central seeks:

It should be understood that, in so far as a given service to its shipper

is covered by the published rate of a freight forwarder, the latter is the

only person to which such shipper is entitled to look for recovery of

damages, and it is in this sense that the forwarder is to ‘be deemed

both the receiving and delivering transportation company.’

Chicago, 336 U.S. at 473 (quoting 87 Cong. Rec. 8220). In light of the content of this statement, we

must consider the appropriate weight and authority inhere in statements of legislative history and the

propriety of resorting to such statements in the face of a clear statute.

In Exxon Mobil Corp. v. Allapattah Services, Inc., __ U.S. __, 125 S.Ct. 2611 (2005), the

United States Supreme Court discussed the extent to which a resort to legislative history is

appropriate in the face of an unambiguous statute. The issue before the Court concerned whether

a certain statutory provision abrogated the Court’s previous decision in Zahn v. International Paper

Co., 414 U.S. 291 (1973). The majority opinion relied upon the “plain text” of the statute and

answered in the affirmative, while the dissent argued that the legislative history of the relevant

statutory provision indicated that Congress did not intend to overrule Zahn. Exxon, 125 S.Ct. at

2625. Addressing this split, the majority criticized the dissent’s extensive reliance on legislative

history:

The proponents of the alternative view of § 1367 insist that the statute

is at least ambiguous and that we should look to other interpretive

tools, including the legislative history of § 1367, which supposedly

demonstrate Congress did not intend § 1367 to overrule Zahn. We

can reject this argument at the very outset simply because § 1367 is

not ambiguous. For the reasons elaborated above, interpreting § 1367

to foreclose supplemental jurisdiction over plaintiffsin diversity cases

who do not meet the minimum amount in controversy is inconsistent

with the text, read in light of other statutory provisions and our

established jurisprudence. 

* * * * * * * *

As we have repeatedly held, the authoritative statement is the

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statutory text, not the legislative history or any other extrinsic

material. Extrinsic materials have a role in statutory interpretation

only to the extent they shed a reliable light on the enacting

Legislature’s understanding of otherwise ambiguous terms. Not all

extrinsic materials are reliable sources of insight into legislative

understandings, however, and legislative history in particular is

vulnerable to two serious criticisms. First, legislative history is itself

often murky, ambiguous, and contradictory. Judicial investigation of

legislative history has a tendency to become, to borrow Judge

Leventhal’s memorable phrase, an exercise in “‘'looking over a crowd

and picking out your friends.'’” See Wald, Some Observations on the

Use of Legislative History in the 1981 Supreme Court Term, 68 Iowa

L.Rev. 195, 214 (1983). Second, judicial reliance on legislative

materials like committee reports, which are not themselves subject to

the requirements of Article I, may give unrepresentative committee

members--or, worse yet, unelected staffers and lobbyists--both the

power and the incentive to attempt strategic manipulations of

legislative history to secure results they were unable to achieve

through the statutory text. We need not comment here on whether

these problems are sufficiently prevalent to render legislative history

inherently unreliable in all circumstances, a point on which Members

of this Court have disagreed.

Exxon, 125 S.Ct. at 2625.

Similarly, we find no language in § 14706 to support the proposition, advanced by Central,

that freight forwarder liability is exclusive. When statutory language is clear, courts should not

resort to statements of legislative history and extrinsic material, including those that create

ambiguities or contradict the clear language of the statute. Id. 

Furthermore, many of the concerns recognized by the Exxon majority also apply to

Representative Wolverton’s statements. For example, the Supreme Court’s opinion in Chicago

acknowledged the existence of a House Report that contradicted Representative Wolverton’s

statements, but the Court dismissed the Report as lacking credibility. See Chicago, 336 U.S. at 472-

73. 

Additionally, Representative Wolverton’s statements appear to contain a fundamental

misunderstanding of prior law. Representative Wolverton pronounced:

If damage to a shipment occurs in the line of a common carrier whose

services are being utilized by the forwarder, the forwarder has no

right to subrogation [under the Carmack Amendment], since its own

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shipper never had any right of action against such carrier.

87 Cong. Rec. 8220. The Second Circuit Court of Appeals rejected Representative Wolverton’s

assertion that a forwarder had no right to subrogation under the Carmack Amendment as based on

the faulty premise that a shipper never had a cause of action against an underlying carrier at common

law. See Acme Fast Freight v. Chicago, Milwaukee, St. Paul & Pac. R. Co., 166 F.2d 778, 783 n.

17 (2d Cir. 1948). Although the Supreme Court reversed on the subrogation issue, the Court

implicitly acknowledged Representative Wolverton’s error, rejoining that “[o]f course shippers by

freight forwarder have for many years been permitted to sue underlying carriers for loss or damage

occasioned by the latter.” Chicago, 336 U.S. at 487 n.27.

Finally, as discussed supra, we reiterate that those courts which have addressed this issue

have unanimously held that a cause of action exists in favor of a shipper against both the freight

forwarder and the underlying carrier under the Carmack Amendment. See Old Dominion, 633

F.Supp. 688; Beautifax, 611 F.Supp. 537. After coupling this unanimity with the Supreme Court’s

admonishment that “the authoritative statement is the statutory text” and that “[n]ot all extrinsic

materials are reliable sources,” we decline to give significant weight to Representative Wolverton’s

statement.

Because we hold that a freight forwarder’s liability under § 14706 of the Carmack

Amendment is not exclusive, we need not determine whether Logistics is a freight forwarder within

the meaning of the statute. Under our interpretation, Central is an appropriate defendant in this

action whether Logistics is a freight forwarder or an initial carrier. Accordingly, Central’s motion

for summary judgment is denied as to Accu-Spec’s claim under 49 U.S.C. § 14706.

B. 49 U.S.C. § 14704

Central also moves for summary judgment as to Accu-Spec’s 49 U.S.C. § 14704 claim,

asserting that this claim should be dismissed as lacking evidentiary and legal support. Accu-Spec’s

brief in opposition did not oppose this argument. Accordingly, Central’s motion for summary

judgment is granted as to this claim. Count One of the complaint is hereby DISMISSED as to

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Central.

IV. CONCLUSION

An appropriate Order follows. 

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ACCU-SPEC ELECTRONIC SERVICES, )

INC., )

Plaintiff, )

)

v. ) Civil Action No. 03-394 Erie

)

CENTRAL TRANSPORT )

INTERNATIONAL, et al., )

)

Defendants. )

ORDER

AND NOW, this 17th day of August, 2005, and for the reasons set forth in the accompanying

Memorandum Opinion, 

IT IS HEREBY ORDERED that the Motion for Summary Judgment of Defendant Central

Transport International [Doc. No. 15] is GRANTED as to Count One of the Complaint and

DENIED as to Count Two of the Complaint.

/s/ Sean J. McLaughlin 

United States District Judge

cm: All parties of record. ___

 

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