### In the 

# United States Court of Appeals For the Seventh Circuit

____________________ No s

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K AWASAKI K ISEN K AISHA , L TD ., “K” L INE A MERICA , I NC ., and U NION P ACIFIC R AILROAD C O

. , Plaintiffs

- Appellants ,

v.

P LANO M OLDING C O

. , Defendant

- Appellee

.

____________________ Appeal s from the United States District Court for the Northern District of Illinois , Eastern Division. No. 07 C 5675

— Harry D. Leinenweber , Judge

.

____________________
A RGUED J ANUARY 6, 2015

— D ECIDED M ARCH 31 , 2015

____________________

Before F LAUM , W ILLIAMS , and T INDER , Circuit Judges

. F LAUM , Circuit Judge

. On April 21, 2005, a Union Pacific freight train derailed in Oklahoma. The train was carrying two steel injection molds being delivered to Plano Molding Company in Illinois. The derailment occurred after the molds broke through the floor of their shipping container, causing that train car and many behind it to derail and r esulting in appr oximately $4 million in total damage. The2 No s

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molds had been manufactured in China and shipped to the United States before being transferred to the Union Pacific train for the final leg of their journey.
At issue in this case is the reason that the molds broke through the floor. The appellants are three companies that

were involved in the shipment of the molds and sustained losses from the accident : Kawasaki Kisen Kaisha, Ltd., “K” Line America, Inc. (coll ectively , “K

- Line”), and Union Pacific Railroad Co. (“Union Pacific”). They sued Plano, claiming that Plano was at fault because a company it hired packed the molds into the shipping container improperly, causing the floor of the container to break and ult imately causing the derailment. I f true , Plano would be liable to appellants for breach of a warranty found in a document known as the “World Bill of Lading , ” which provided contractual terms for the shipment of the molds. Plano, in defense , argued that th e molds were properly packed and that they fell through the floor of the container because the container was defe ctive. In a bench trial, the district court found in favor of Plano, concluding that appellants had not proved that the molds were improper ly p acked . The court also held that the d erailment was in fact caused by deficiencies in the container. On appeal, the plaintiffs contest these factual conclusions, as well as a number of other aspects of the district court’s opi nion. For the reasons set forth below, we affirm. I. Background Plano is an Illinois corporation that designs, manufa ctures, and sells plastic storage boxes. In 2004, Plano ident ified a need to purchase two new steel injection molds , whichNo s

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it uses to manufacture its plastic boxes , and so it contacted CMT International, Inc. (“CMT”), a company that assists customers in the United States who wish to purchase pro ducts from Asia. CMT provided Plano with bids, and Plano selected Kunshan Yuanjin Plastic & Electronic Co., Ltd. (“Kunshan” ), a Chinese company, to make the molds. Ku nshan manufactured the molds and loaded them into wooden
crates.
Plano hired World Commerce Services ( “World” ) , 1 a non

vessel operating common carrier, 2 to arrange for the shi pment of the molds from China to Plano ’s factory in Illinois. World then contracted with the THI Group LTD (“THI”) and K

- Line for the physical shipment of the molds. THI, in turn, hired Shanghai Haixing Yuancang Container Transportation Co. (“Haixing”) to load the molds into an intermodal shi pping container and hired Shanghai Ocean Tally Company as a “checker,” which ensured that the molds were properly loaded. That shipping container carried Plano’s molds ( i nside of their wooden crates) from the moment they were packed in China until the Union Pacific train derailed in O klahoma

. Both World and K

- Line issued bills of lading cove ring the shipment of the molds. K

- Line handled the ocean

1 Plano contends that it was actually CMT that retained World’s services. For the purposes of this appeal, however, this dispute is irrelevant.

2 As their name suggests, non

- vessel operating common carriers do not own or operate ships or other means of fre ight transportation. Rather, they act primarily as coordinators of shipping logistics, and contract with carriers to actually move goods. They do, however, assume common ca rrier responsibility , 46 U.S.C. § 40102(6) , (16), and often issue their own bills of lading. See, e.g., Sompo Japan Ins. Co. of Am. v. Norfolk S. Ry. Co. , 762 F.3d 165, 168

– 69 (2d Cir. 2014).4 No s

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part of the voyage, but subcontract ed the over land mov ement of the molds within the United States to Union Pacifi c. Once the shipping container carrying Plano’s molds arrived in the U.S., it was transferred from K

- Line to Union Pacific, which began transporting the container by train from Cal ifornia to Illinois. During the voyage, the molds somehow broke through the floor of the shipping container, causing the train to derail in Oklahoma

. The accident caused appro ximately $2 million in damage to the cargo of K

- Line’s cu stomers and $2 million in costs to Union Pacific. Appellants sued in federal court, attempting to hold Pl ano liable for certain d amages caused by the derailment and seeking indemnification for claims made against appellants by third parties who suffered damages in the accident. The district court initially granted summary judgment in Plano’s favor on all of appellants ’ claims, but this court reversed on one claim

— a bre ach of contract claim based on a warranty in the bill of lading issued by World. Kawasaki Kisen Kai sha, Ltd. v. Plano Molding C o. , 696 F.3d 647 , 657

– 5 8 (7th Cir. 2012 ). We remanded to the district court to determine whether Plano was subject to the terms of the World Bill of L ading

. After a

one

- day trial, the district court held that Plano was bou nd by the World Bill of Lading and could be held liable t o appe llants if it violated the terms of that agreement. Kawasaki Kisen Kaisha, Ltd. v. Plano Molding Co. , No. 07 C 5675, 2013 WL 3791609 , at *8 (N.D. Ill. July 19, 2013) (“ Kawasaki I ”)

. Pl ano does not appeal that ruling.
The district court then held a three

- day trial to determine whether Plano breached Clause 10(2) of the World Bill of L ad ing, which states:No s

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If Carrier receives the goods already packed i nto containers:

... (2) Merchant warrants that the stowage and seals of t he containers are safe and proper and suitable for handling and carriage and inde mnifies Carrier for any injury, loss, or damage caused by the breach of this warranty Plano, the parties agree, was a “Merchant” as defined in Clause 2(3) of the World B ill of L ading. The World Bill of Lading defined World as the “Carrier,” but Clause 3 pr ovides that World’s contractors and subcontractors

— including all of the appellants

— are entitled to all of the Ca rrier’s rights under the Bill of Lading

. The trial consisted l argely of expert testimony. Appellants sought to prove that Plano breached Clause 10(2) by i mproperly stowing and securing the molds in the shipping container. 3 There was no direct evidence of how the molds were packed into the container, and neither part y presented witnesses who were involved in the loading of the container. That is in part because the container was packed in China, making it difficult to obtain this information.

3 As stated above, Plano itself did not actually pack its molds into the shipping containers; rather, Haixing did, and its work was checked by Shanghai Ocean Tally. However, assuming, as the district court did, that these companies were hired by Plano to pack the molds, Plano would be liable for those companies’ breach of Clause 10(2) just as if Plano itself had packed the container. Therefore, to avoid unnecessary complexity, we will conduct our analysis as if Plano itself packed the molds.6 No s

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The derailment itself also made it very difficult to dete rmine after the fact how the container had been loaded. Much of what was inside of the container before the crash ended up outside of it, spread over the miles

- long crash site. About 60% of the floor of the container was missing after the acc ident, allowing much to fall o ut during the derailment. There was, however, some physical evidence about the stowage of the molds. Together, the two molds weighed 25,000 pounds , and each was packed into its own wooden crate

. One mold was much larger than the other

— it weighed 18,900 pou nds, while other weighed 6,100 pounds. When packing shipping containers, packers use wooden pallets, wooden beams, and other types of dunnage (all types of inexpensive waste mat erials) to support and distribute the weight of cargo. After the derailment, al l that was found in the shipping container was one 43

- inch long wooden pallet, which presumably suppor ted, at least in part, the weight of one of the crates. There were remnants of wooden pallets found at the accident site, as well as a wide variety of oth er debris that could have served as dunnage. Exhibit 281 , a photograph taken at the derailment scene, appears to show two pallets that survived the accident, as well as several long wooden boards. It is not clear, however, which shipping container the pall ets and wood came from, as the derailment caused multiple contai ners to break open and spill their contents. Appellants ’ theory of the case was that the molds were packed in a way that did not sufficiently distribute their weight in the container. They bas ed this contention on the guidelines set forth in Circular 43

- D, a publication of the A ssociation of American Railroads, an industry trade group. Appellants argued that the guidelines in Circular 43

- D , which was entered into evidence , should serve as the s tan d-No s

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ard of care in this case. Appellants did not claim that the t otal weight of the molds violated the Circular 43

- D guid elines , but rather that the weight was too concentrated. R egarding the concentration of weight in a shipping container, Circular 43

- D s tates that “not more than 25,000 lbs. unifor mly distributed in any 10 linear feet can be loaded.” Appellants’ argument was presented largely through its expert witness, Dr. Robert Vecchio. Vecchio theorized that the pallet found in the shipping container f ollowing the a ccident was one of two identical 43

- inch pallets that were origin ally used to support the molds, with each pallet su pporting one crate. The larger of the two crates weighed 18,900 pounds; spread out over 43 inches, that translates to over 5,0 00 pounds per linear foot, which is double the amount allowed for in Circular 43

- D. Vecchio admitted, however, that a 43

- inch pallet would have been sufficient to disburse the weight of the smaller crate. Vecchio also argued that the crates were not properly s ecured (“lashed”) within the shipping container, which a llowed the crates to exert “dynamic amplification”

— in other words , bouncing

— on the floor of the container

. His theory was that the combination of a failure to secure the crates and a failure to distribute the crates’ weight properly led to ove rstressing of the container floor, eventually causing the floor to break. To support his theory, Vecchio noted that no las hing material was found inside of the container or around the train following the derailment. Additionally, he referred to a number of “significant dents” in the wood floor of the co ntainer that were found after the derailment. According to Vecchio, these dents were caused by dynamic amplification8 No s

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of the crates, which only could have o ccurred if the crates were not properly las hed. The parties ’ experts referred to n umerous investigative reports about the derailment at trial. The most important r eport, on which both appellants and Plano relied heavily and which was introduced into evide nce, was produced by a company called Intertek Caleb Brett

. Appellants focused on the Intertek report’s statement that the crates were placed in the center of the container , arguing that this implied that the weight of the crates was not properly distribut ed. On the other hand, the Intertek report stated that the crates were s ecured and lashed, contrary to Vecchio’ s theory. Another i mportant piece of evidence was a “Testification” produced by the Shanghai Ocean Shipping Tally Company, the company that super vised the loading of Plano’s molds into the shi pping container. The Testification, like the Intertek report, stated that the cargo was loaded in the middle of the co ntainer. However, it also stated that the crates were “packed sound,” which could imply tha t the crates’ weight was properly distributed and that the cargo was properly lashed. Finally, a post

- derailment email from Joana Feng of the THI Group to World’s John Wember stated that “wooden brac kets” had been used “to fix the case[s] in order not to m ove when transmitting.” On cross

- examination, Vecchio stated that he had not previously seen the Testification or Feng’s email, and therefore did not take either into account when formulating his report. The district court found that appellants had not pro vided sufficient evidence to prove that the weight of Plano’s crates was not distributed properly. Without any direct evidence as
to how the container was packed, the court said that it wasNo s

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pure speculation for Vecchio to assume that the crates were supported by two 43

- inch pallets. Although only one pallet was found in the container after the derailment, the district court noted that a second pallet

— which even Vecchio a ssumed had been present

— could have been large enough to support th e larger crate. Moreover, the crates may have been supported by other pieces of dunnage. According to the di strict court, any of these scenarios was equally plausible given that more than enough wood to adequately support the
crates was found at the site o f the accident

. The district court also found that there was not enough evidence to support appellants ’ claim that the crates had not been properly lashed. The court criticized Vecchio for disr egarding the Intertek report’s finding that the crates had been properly secured and lashed, when Vecchio otherwise relied heavily on the report and had said that it “provided the best available information” and that he “had no reason not to b elieve it.” The district court also stated that Vecchio’s concl usion was bel ied b y the email from Feng to Wember stating that the crates had been fixed to prevent movement. The di strict court downplayed the fact that no lashing material had been found at the accident site, stating that it could have been lost or destroyed during t he accident, or that investig ators may have not even searched for it. The court also rejec ted Vecchio’s theory that the dents in the container’s floor were caused by dynamic amplification of the crates. The dents, the court noted, could have preexisted the loading of the crates into the container or could have been created when the crates were loaded or during the violent derai lment.10 No s

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Both appellants and Plano also presented a great deal of evidence regarding the cause of the derailment, most of which focus ed on the condition of the shipping container. Because we ultimately agree with the district court’s concl usion that appellants failed to prove that Plano breached Clause 10(2), and therefore do not reach the issue of caus ation, we provide only a brief sum mary of this evidence here. In essence, Plano and its experts argued that the container was defective, mostly due to the condition of its welds. Pl ano’s position was that the molds fell through the floor of the shipping container not because they were pack ed imprope rly, but rather because the floor of the container was defective and gave way. Appellants, convers ely, argued that the welds, and the container as a whole, were sound. The district court agreed with Plano, finding that the shipping container was defective and that “defective welds in the shipping container caused the molds to fall through the bottom of the container and cause the derailment.” Kawasaki Kisen Kaisha, Ltd. v. Pl ano Molding Co. , No. 07 C 5675, slip op. at 23 (N.D. Ill. Mar. 6, 2014) (“ Kawasaki II ”)

. II. Discussion Appellants ’ central argument is that the district court clearly erred by finding that appellants failed to meet their burden of proving that Plano breached Claus e 10(2), and that this breach caused the Union Pacific derail m ent. Before turning to this general issue, we address appellants’ arg uments regarding more specific aspects of the district court’s opinion. We apply federal maritime law because jurisdiction exists under 28 U.S.C. § 1333. See Norfolk S. Ry. Co. v. Kirby , 543 U.S. 14, 24

– 25 (2004) (finding bills of lading involvingNo s

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overseas shipment of goods to be maritime contracts even where the last leg of the journey was by rail).
First, appellants argue that the district court ignored the guidance of Daubert v. Merrell Dow Pharmaceuticals , 509 U.S. 579 (1993), when it assessed the testimony of their expert, Vecchio. Specifically, they claim that it was improper for the district court to find Vecchio’s theory less “credible” than the theories presented by Plano’s experts

. Daubert , they argue, precludes a judge acting as a trier of fact from questioning an expert witness’s conclusions

. Appellants misunderstand a court’s role in assessing expert testimony. It is true, as appe llants point out, that the Daubert Court said a judge’s focus when assessing expert testimony “must be solely on princ iples and methodology, not on the conclusions that they ge nerate.” Id . at 595. The Court, though, was referring to a judge’s analysis, under Federal Rule of Evidence 702, of whether t o admit expert testimony 4 at all. Id . at 594

– 95

. In making this determination, a judge acts as a “gatekeeper” to ensure that expert testimony is not admitted into evidence unless it is sufficiently reliable. Dhillon v. Crown Controls Corp. , 269 F.3d 865, 8 69 (7th Cir. 2001). Th e district cour t here performed this gatekeeping analysis for each expert . I n fact, the court did so both before the trial and in its final opinion, after both appellants and Plano once again asked the court to exclude the other side’ s expert testimony under Daubert

. Ne ither party contends that the judge performed these analyses incorrectly.

4 More precisely, Daubert dealt with the standard for admitting expert scientific testimony. Daubert , 509 U.S. at 582. The Daubert standard was later extended to apply to all expert testimony in Kumho Tire Co., Ltd. v. Carmichael , 526 U.S. 137, 141 (1999).12 No s

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Once an expert’s testimony is admitted , it is treated no differently than lay testimony

. See United States v. Christian , 673 F.3d 702, 712 (7th Cir. 2012) ( citing Federal Criminal Pa ttern Jury Instructions of the Seventh Circuit 3.07); United States v. Mansoori , 304 F.3d 635, 654 (7th Cir. 2002) (endorsing a jury instruction stating that “the fact that an expert has given an opinion does not mean that it is binding upon you or that you are obligated to accept the expert’s opinion as to the facts.”). When expert testimony has been admitted under Daubert , the “soundness of the factual underpinnings of the expert’s analysis and the correctness of the expert’s concl usions based on that analysis are factual matters to be dete rmined by the trier of fact.” Stollings v. Ryobi Tech. , Inc. , 725 F.3d 753, 765 (7th Cir. 2013) (q uoting Smith v. Ford Mo tor Co. , 215 F.3d 713, 718 (7th Cir. 2000) )

. In a bench tria l, once the
court has fulfilled its gatekeeping function , it becomes a trier of fact that needs to assess the evidence itself

— not jus t the methodology underlying that evidence. Th e judge, as trier of fact, was required to play his “ essential role as the arbiter of the weight and credibility of expert testimony.” Id

. In co ncluding that Plano’s experts were more credible than Ve cchio, the judge properly scrutinized each expert ’ s assum ptions, reasoning, and conclusions, as is the duty o f the trier of fact. Next, appellants argue that the district court was wrong to believe that they had made an argument regarding the proper securing and lashing of the molds within the shi pping container. Appellants claim that they never made such an argument; rather, they only argued that the weight of the molds was not sufficiently dispersed

. Appellants also claim that the district court was incorrect when it stated that “Dr. Vecchio’s theory of the accident hinges on the idea that theNo s

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Molds were not lashed down properly in the Container.” Kawasaki II , No. 07 C 5675, slip op. at 17

. If appellants are correct, it is possible that the district court’s mistake caused it
to wrongly discredit Vecchio’s testimony. But app ellants are wrong about their own argument. In their Post

- Trial Closing Statement, appellants devote d more than a page to this argument, stating that “the post

derailment investigation did not unearth any evidence” that the molds were secured and that the “ ‘ dents’ Vecchio found in the plywood floor, however, show the steel molds were not properly secured ag ainst vertical movement.” To su pport their lashing argument, they then quote d from Vecchio’s testimony, demonstrating that Vecchio’s theory indeed a ssumed that the crates were not lashed. Appellants ’ co mplaints about the district court , therefore, are n ot credible. Even more disturbing is appellants ’ criticism of the district
court for using the word “bouncing” to refer to Vecchio’s te stimony about “dynamic amplification.” In their closing a rgument, appellants thrice referred to dynamic amplification

as bouncing; in fact, they did not use the correct term, “d ynamic amplification,” at all. 5

5 Appellants also take issue with the district court’s statement that it was “as sum[ing] , without finding, that Plano is subject to Clause 10.2.” Kaw asaki II , No. 07 C 5675, slip op. at 28

. Appellants argue that this was a se ttled issue, and therefore that no assumption was necessary. Though this assumption was in the appellants’ favor, and therefore did not impact the outco me below, we think it is worthwhile to provide some clarific ation on this matter. The appellants contend that, b y questioning whether Plano was “sub ject to” Clause 10(2), the district court contradicted its July 19, 2013 ruling that Plano was bound to the World Bill of Lading. We appreciate the appellants’ point, as we think that the district court’s discussion here was imprecise. Clause 10(2) has a condition precedent; it14 No s

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We now turn to the heart of this appeal: whether the di strict court clearly erred by finding that appellants failed to prove that Plano breached Clause 10(2) of the Wor ld Bill of L ading. Appellants challenge both the district court’s alloc ation of the burden of proof and its determination that appe llants did not meet their burden. We review de novo a district court’s allocation of the burden of proof. Chi. Prime Packers, Inc. v. Northam Food Trading Co. , 408 F.3d 894 , 898 (7th Cir. 2005). We review a district court’s findings of fact under the clearly erroneous standard. Fed. R. Civ. P. 52(a)(6); United States v. U.S. Gypsum Co. , 333 U.S. 364, 395 (1948) (“A finding is ‘clearly erroneous’ when although there is evidence to support it, the reviewing court on the entire evidence is left with the definite and firm conviction that a mistake has been committed.”). Normally, the party claiming breach of a warranty under a maritime contract

— here, appellants

— bears the burden of proof. See, e.g. , Cent. Oil Co. v. M/V Lamma

- Forest , 821 F.2d 48, 49 (1st Cir. 1987). Appellants argue, however, that in this

only applies if the “Carrier receives the goods already packed into co ntainers.” At t rial, the parties disputed whether this condition had been satisfied. The district court, though, did not decide the issue because it concluded that, even if Clause 10(2) was triggered, Plano had not breac hed the warranty found in that C lause. As we explai n below, this conclusion was sound. At that point in the litigation, it was settled that Plano was subject to Clause 10(2) because it was bound as a party to the terms of the World Bill of Lading. Rather, the question was whether the Clause was applicable in this case

— that is, whether Plano’s duty to safely and properly stow the molds was triggered. This is clearly what the di strict court meant to say. Regardless, neither the misstatement nor the district court’s decision not to definitively rule on the ma tter caused a ppellants any prejudice.No s

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case the burden should fall on Plano to prove th at the m olds were packed properly because Plano has readier access to knowledge about the facts in question

— how the shipping container was actually packed in China. Specifically, appe llants point to Plano’s contractual relationships with World and THI, either of w hich could have inquired with its agents

— Haixing and Shanghai Ocean Tally

— about how the containers were loaded. They also argue that Plano’s eng ineering vice

- president has a home in China, and that he should have investigated how the container was actually loaded. Appellants’ argument is based on John Henry Wigmore’s rule that “the burden of proving a fact is said to be put on the party who presumably has peculiar means of knowledge enabling him to prove its falsity if it is false.” 9 Wigmore, E vidence § 2 486, at 275 (3d ed. 1940). The Supreme Court has also endorsed this rule: “the ordinary rule, based on consi derations of fairness, does not place the burden upon a lit igant of establishing facts peculiarly within the knowledge of his a dversary.” Campbell v . United States , 365 U.S. 85, 96 (1961). Wigmore’s “rule” is not mandatory; rather, it is a “policy consideration” to be “applied in certain cases” as “a rule of fairness.” Erving Paper Mills v. Hudson

- Sharp Machine Co. , 332 F.2d 674, 678 (7th Cir. 1964) ; see also Wigmore, supra , at 275 (“The truth is that there is not and cannot be any one general solvent for all cases. It is merely a question of policy and fairness based on experience in the different situ ations.”). Appellants point to two cases in which this maxim was employed. In Erving Paper Mills , a products liability case, we said that the manufacturer of a product should bear the bu r-16 No s

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den of proving that the product was suitable for sale to ot hers in the ordinary course of its business. 332 F.2d at 678

. And in Shanghai Automation Instrument Co., Ltd. v. Kuei , 194 F. Supp. 2d 99 5, 1004 (N.D. Cal. 2001), a district court in Cal ifornia held that the burden of proof should shift to the d efendants where the plaintiff alleged that certain funds r eceived by th e defendants were improperly converted for personal use. The defendants, the court noted, had sole po ssession of information regarding how the funds were spent. We found a number of other cases in which this rule w as
e mployed

. For example, i n Shatterproof Glass Corp. v. Libbey

Owens

- Ford Co. , the Sixth Circuit shifted the burden of proof to the defendant, which had peculiar knowledge of the ro yalty rates it had paid to various patent holders. 482 F.2d 317, 324 (6th Cir. 1973)

. And i n PepsiCo , Inc. v. Redmon d , a trade
secrets case brought by Pepsi against a former employee who had joined a rival corporation, the district court granted Pepsi’s requested injunction barring Redmond from divul ging trade secrets. 1996 WL 3965, at *1 (N.D. Ill. Jan

. 2, 1996)

. The court forgave Pepsi’s inability to prove what job duties Redmond would have at his new job, shifting the burden to Redmond on this issue because the details of his job duties were peculiarly within his and his new employer’s knowledge. Id . at *21. The se cases are representative of the others that we examined

. For a number of reasons, we decline to apply this type of burden shifting in this case. First, the information at issue is
not “peculiarly within the knowledge” of Plano

. Campbell , 365 U.S. at 96. In each of the above

- cited cases where the burden of proof was shifted, the adversary itself had pecul iar knowledge of the information at issue. Here, in contrast, not only does Plano lack “peculiar” (i.e., “exclusive”)No s

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knowledge of the information at iss ue, it lacks any knowledge whatsoever

— Plano simply has no information about how the shipping container was actually loaded. A ppellants argue that Plano has a closer relationship with the foreign companies that possess this knowledge, and ther efore that Plano has easier access to that information. Even if that is true, those companies are separate entities from Pl ano , and the mere fact that Plano may have a closer relatio nship with them does not bring this information peculiarly within Plano’s k nowledge. Moreover, appellants have not demonstrated that Plano would actually be able to acquire the information at issue. The mere fact that Plano has , in the past, had contractual relationships with the foreign comp anies that possess the relevant inform ation does not mean that Plano currently has unfettered access to that info rmation . It is similarly irrelevant that a Plano vice

- preside nt has a personal home in the country where those companies are based

. China is vast (over 9.5 million square kilometers ) and has the largest population on earth; appellants fails to explain how Plano’s vice

- president would have easy access to the information at issue. See Central Intelligence Agency, The World Factbook: China (2014), available at https://www.cia.gov/library/publications/the

- world

factbook/geos/ch.html (last visited Mar. 3, 2015)

. In sum , fairness does not dictate that the burden of proof on this i ssue be shifted to a party with no actual knowledge of the relevant information and, i t seems , no ready way to acquire it.
The district court , therefore, properly held appellants to the burden of proving by a preponderance of the evidence that Plano breached the warran ty in Clause 10(2). That bu rden required appellants to prove it was more likely than not18 No s

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that Plano breached the warranty. See Bunge Corp. v. Carlisle , 227 F.3d 934, 937 (7th Cir. 2000). The district court did not clearly err by finding that appellants failed to meet this bu rden. 6 Appellants presented no evidence of how the molds were actually packed into the shipping container. The fact that only one relatively small pallet was found in the container after the crash means little

— most of the container’s contents lik ely fell out duri ng the derailment. As the district court noted, large amounts of wood

— and even some complete pallets

— were found near the derailment site, any of which could have come from the container in question. Appellants argue that it was “wild speculation” for the d istrict court to su ggest that the wood found at the crash site may have suppor ted Plano’s molds. But appellants overlook the fact that they had the burden of proving that the crates were improperly supported. Because they had no direct evidence of how the container was loaded, appellants had to resort to circumsta ntial evidence

— the fact that only one small pallet was found in the container post

- derailment. Appellants argued that an inference should be made from this discovery that the pallet in the containe r was the only one used to support the molds, or that there were at most two pallets of identical size. That inference was weakened by the fact that there was ample wood found at the crash site that could have served as su pport for the molds. The district court did not find that these scraps had supported the molds . Rather, it found that the

6 Appellants do not appeal the district court’s finding regarding how the molds were lashed and secured within the container; rather, they claim that they never made an argument about lashing in the first place. Ther efore, we not need review that aspect of the district court’s opinion.No s

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existence of the wood undermined appellants’ argument that the molds had been improperly supported. Moreover, Ve cchio’s assumption that the molds were supported by two identical and insufficiently supportive pallets was based on pure speculation. The missing pallet (or pallets) could just as easily have been much larger, or, conversely, nonexistent; there was simply no way to know based on what was found in the container post

- derailment. Appellants repeatedly complain that Plano presented no evidence to suggest that the molds were properly packed. As the defendant, though, Pla no did not have to prove anything

. Appellants have not produced enough evidence to p rove that Plano breached the warranty found in Clause 10(2)

. Their final argument, however, is that they should not have to affirmatively prove breach, but rather that breach should be presumed based on the circumstances of this case. They argue , “[c] arriers receivi ng a sealed container cannot poss ibly [prove how the container was loaded]

— it is a ridiculous burden to carry, hence the warranty. When ‘ K ’ Line proved there was no evidence anywhere of proper weight disper sing material for the larger crate, and without pr oper dispe rsal the stress was excessive, its prima facie case was made. ” Reply Br. 17. Appellants are wrong about the purpose of the warranty

— it exists to create a contractual duty, not to shift the burden of proof. Their general contention , though, is tha t the nature of an accident should provide a presumption of breach because, absent the presumption, carriers will rarely be able to provide direct evidence of breach, rendering the warranty a nullity. This argument is underdeveloped, and appellants provide no case law t o support this approach, but we interpret it to be an attempt to import the doctrine of res ipsa loquitur into the realm of contract law.20 No s

. 14

- 1171 & 14

- 1189

Aside from whether the res ipsa loquitur doctrine can e ver apply in a breach of contract case , it is clear that the do ctrine should not apply in this case. We are sympathetic to appellants’ argument that it will often be exceedingly diff icult for a carrier to affirmatively prove that a shipping co ntainer was improperly packed when a derailment

— precisely the type of injury a warranty of proper stowage is intended to prevent

— has led to the destruction of the most probative evidence. This problem, however, was known to the parties when they agreed to be bound by the World B ill of L ading. With that problem in mind, appellants could have insisted upon a provision in the Bill of L ading stating that, in a case such as this, where a derailment is caused by a merchant’s goods breaking through the floor of a shipping container, there would be a presumption that the container was mi spacked. 7 As the Bill of L ading was actually written, however, there is no such presumption, and a carrier must affirmativ ely prove breach and causation. W e decline to effectively r ewrite the terms of the Bill of L ading by presuming breach.

7 Clause 10(5) of the World Bill states : “Merchant shall inspect containers before stuffing them and the use of the containers shall be prima facie e vidence of their being sound and suit able for use.” Therefore, it is evident that the parties knew how to incorporate evidentiary presumptions into the Bill of L ading. The failure to do so explicitly in Cl ause 10(2) demo nstrates that the parties did not wish to create such a presumption.

The presumption included in Clause 10(5), we note, does not impact our analysis of whether Plano breached its duty under Clause 10(2). As the district court correctly stated , “[t]he question of whether the stowage and seals were safe and proper is a different question than whether the container was sound and suitable.” Kawasaki II , No. 07 C 5675, slip op. at 27

– 28.No s

. 14

- 1171 & 14

- 1189 21

Because we agree with the district court’s conclusion that appellants did not meet their burden of proving that Plano breached Clause 10(2), we do not need to review its findings that the shipping container was defective and that those d efects caused the molds to fall through the container floor, u ltimately causing the derailment. Plano had no obligation to explain why the accident occurred. Once the district court found that appellants had not met their burden of proving that Plano had breached Clause 10(2), the actual cause of the accident became legally irrelevant. 8 Therefore, we agree with the district court that Plano is not liable to appellants for damages stemming from the derailment.
III. Conclusion

We A FFIRM the judgment of the district court.

8 The district court’s finding regarding the cause of the accident, we note, was not in itself sufficient to relieve Plano of liability. To prevail , appe llants had to prove, in addition to breach, that Plano’s breach caused the derailment. The district court found that the defective state of the shi pping container was a but

- for cause of the accident. However, the fact that a container ’s defective state was a but

- for cause of a derailment does not mean that a merchant’s improper stowage of goods was not also a but

- for

cause. Under those circumstances, the merchant could conceivably be liable because its breach was a cause (though not th e only cause) of da mage.