Court Opinion

ID: 152320
Source: CourtListenerOpinion
Date Created: 2010-08-06 00:00:56+00
Date Added: 2024-06-11T09:14:59.840240
License: Public Domain

05-7039-cv(L), 07-4739-cv(XAP)
Sompo Japan Ins. v. Union Pacific

                         UNITED STATES COURT OF APPEALS
                             FOR THE SECOND CIRCUIT

                                    SUMMARY ORDER

RULINGS BY SUMMARY ORDER DO NOT HAVE PRECEDENTIAL EFFECT.
CITATION TO A SUMMARY ORDER FILED ON OR AFTER JANUARY 1, 2007, IS
PERMITTED AND IS GOVERNED BY FEDERAL RULE OF APPELLATE PROCEDURE
32.1 AND THIS COURT=S LOCAL RULE 32.1.1. WHEN CITING A SUMMARY ORDER
IN A DOCUMENT FILED WITH THIS COURT, A PARTY MUST CITE EITHER THE
FEDERAL APPENDIX OR AN ELECTRONIC DATABASE (WITH THE NOTATION
“SUMMARY ORDER”). A PARTY CITING A SUMMARY ORDER MUST SERVE A
COPY OF IT ON ANY PARTY NOT REPRESENTED BY COUNSEL.

       At a stated term of the United States Court of Appeals for the Second Circuit, held
at the Daniel Patrick Moynihan United States Courthouse, 500 Pearl Street, in the City of
New York, on the 5th day of August, two thousand ten,

PRESENT:
              Hon. Robert A. Katzmann,
              Hon. Barrington D. Parker,
                           Circuit Judges.*

                          Docket Nos. 05-7039-cv(L), 07-4739(XAP)
                                  _____________________

           Sompo Japan Insurance Company of America and Olympus America, Inc.,
                                                     Plaintiffs-Appellants-Cross-Appellees,

                                            C v .C

                               Union Pacific Railroad Company,
                                                         Defendant-Appellee-Cross-Appellant,

*
 The Honorable Sonia Sotomayor, originally a member of the panel, was elevated to the
Supreme Court on August 8, 2009. The two remaining members of the panel, who are in
agreement, have determined the matter. See 28 U.S.C. § 46(d); 2nd Cir. I.O.P.E; United States v.
Desimone, 140 F.3d 457 (2d Cir. 1998).
                                               and

                              Norfolk Southern Railroad Company,
                                                                                        Defendant.

______________________________________

       Appeal from a judgment of the United States District Court for the Southern District of

New York (Batts, J.).

       UPON DUE CONSIDERATION, it is hereby ORDERED, ADJUDGED, AND

DECREED that the judgment of the District Court is REVERSED and REMANDED to the

District Court for further proceedings.

       Defendant Union Pacific Railroad Company (“Union Pacific”) appealed from a judgment

granting plaintiffs’ motion for partial summary judgment, which we affirmed. Sompo Japan Ins.

Co. v. Union Pac. RR. Co., No. 02 Civ. 9523, 2007 WL 4859462 (S.D.N.Y. Sept. 26, 2007);

Sompo Japan Ins. Co. v. Union Pac. RR. Co., 341 F. App’x 707 (2d Cir. 2009). Union Pacific

subsequently filed a petition for a writ of certiorari. The Supreme Court granted the petition,

vacated our judgment, and remanded the cause for further consideration in light of Kawasaki

Kisen Kaisha Ltd. v. Regal-Beloit Corp., 130 S. Ct. 2433 (2010). See 78 U.S.L.W. 3418 (U.S.

June 28, 2010). We assume the parties’ familiarity with this case’s underlying facts and

procedural history.

       In November 2001, Olympus Optical Co. (“Olympus”) shipped four containers of digital

cameras from Tokyo, Japan through Tacoma, Washington for on-carriage to Woodbury, New

York. Olympus contracted with Kawasaki Kisen Kaisha (“K-Line”) for the movement, and K-

Line issued a through bill of lading that covered the cargo’s transport from Japan to New York.

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The through bill of lading incorporated by reference K-Line’s standard Bill of Lading terms,

Clause 4 of which states,

       [w]ith respect to Goods shipped to, from or through US Territories, Carrier’s
       responsibilities during the entire period (and not just during Water Carriage) from the
       time of receipt of Goods to the time of delivery of Goods shall be governed by the United
       States Carriage of Goods by Sea Act (US COGSA) and US COGSA shall be deemed
       incorporated herein during the entire aforesaid period . . . .

Clause 4 goes on the provide that “if US COGSA . . . applies, in no event shall Carrier be or

become liable for any loss or damage to or in connection with the transport of Goods in an

amount exceeding US$500 per package . . . .”

       Olympus was given the opportunity to ship the cargo at the full liability rates under the

through bill of lading, but Olympus opted to ship it for a lower freight rate in exchange for a

$500 per package limitation of liability. K-Line subsequently subcontracted with Defendant

Union Pacific for the rail portion of the movement. Accordingly, following the ocean carriage of

the containers from Japan, Union Pacific received the containers in Tacoma, Washington and

carried them, by rail, to Chicago, Illinois. In Chicago, Illinois, one of the containers was

burglarized. Olympus’s insurer, Plaintiff Sompo Japan Insurance of America (“Sompo”) paid

Olympus for the cargo losses. Subsequently, Olympus and Sompo sued Union Pacific, arguing

that Union Pacific was liable for the full amount of losses pursuant to the Carmack Amendment

to the Interstate Commerce Act of 1887 (the “Carmack Amendment”), 49 U.S.C. § 11706.

Union Pacific argued that the through bill of lading extended to it the limited liability provisions

set forth in COGSA, note following 46 U.S.C.§ 30701, thereby capping its liability at $500 per

package.

       In Regal-Beloit, the Supreme Court held that the Carmack Amendment “does not apply

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to a shipment originating overseas under a single through bill of lading.” Regal-Beloit, 130 S.

Ct. at 2442. Since Union Pacific was not a receiving rail carrier within the meaning of the

Carmack Amendment, see id. at 2444, pursuant to Regal-Beloit and our subsequent decision in

Royal & Sun Alliance Insurance, PLC v. Ocean World Lines, Inc., ___ F.3d ___, 2010 WL

2813650 (2d Cir. July 20, 2010), the through bill of lading extended COGSA’s $500 liability

limitation to Union Pacific.

       The judgment of the District Court is reversed and the cause is remanded for further

proceedings.

                                                 FOR THE COURT:
                                                 CATHERINE O’HAGAN WOLFE, CLERK

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