Court Opinion

ID: 2738176
Source: CourtListenerOpinion
Date Created: 2014-09-30 15:01:15.147125+00
Date Added: 2024-06-11T12:20:30.066453
License: Public Domain

Case: 14-11724    Date Filed: 09/30/2014   Page: 1 of 9

                                                         [DO NOT PUBLISH]

            IN THE UNITED STATES COURT OF APPEALS

                    FOR THE ELEVENTH CIRCUIT
                      ________________________

                            No. 14-11724
                        Non-Argument Calendar
                      ________________________

                  D.C. Docket No. 0:13-cv-62577-WPD

JOEL PEREZ,
JP GLOBAL EXPRESS, INC.,
other, JMP Global, Inc.,

                                                           Plaintiffs-Appellants,

                                   versus

FEDEX GROUND PACKAGE SYSTEMS, INC.,

                                                           Defendant-Appellee.

                      ________________________

               Appeal from the United States District Court
                   for the Southern District of Florida
                     ________________________

                            (September 30, 2014)

Before TJOFLAT, JORDAN and KRAVITCH, Circuit Judges.

PER CURIAM:
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      Joel Perez and JP Global Express, Inc., (collectively “the plaintiffs”) appeal

the district court’s dismissal of their breach-of-contract suit against FedEx Ground

Package Systems, Inc. (FedEx). For the reasons that follow, we affirm.

                                          I.

      Perez contracted with FedEx to provide package pick-up and delivery

services. Specifically, in 1998, Perez entered into a Standard Contractor Operating

Agreement (OA) with FedEx, which gave him a proprietary interest in designated

routes. The OA stated, in pertinent part, that “[t]his Agreement shall be governed

and construed in accordance with the laws of the Commonwealth of

Pennsylvania.” In 2004, Perez incorporated JP Global Express, Inc. and added his

new company as a contracting party to the OA. The plaintiffs eventually acquired

a total of four routes for FedEx. Perez worked one route and hired drivers to

handle the other three routes. All four routes operated out of the Miami terminal

and made deliveries within Dade County.

      In 2008, FedEx unilaterally reassigned three of the plaintiffs’ routes to

operate out of the Pompano Beach terminal. The plaintiffs were unable to comply

with the change because their drivers did not want to work out of the new location.

As a result, they ceased to operate two of their routes and Perez elected to drive the

remaining Pompano Beach route. On October 5, 2009, FedEx terminated the OA

and reassigned the plaintiffs’ routes to other drivers. FedEx accused Perez of

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“padding stops,” by counting each package delivered to the same address as a

separate stop on his route.

       Approximately three years later, on August 16, 2012, the plaintiffs moved to

join an existing state court action captioned Encarnacion, et al. v. FedEx Ground

Package Sys., Inc., Case No.: 09-018531-CI-015 (Encarnacion), by filing a motion

for leave to amend, which included a copy of the amended complaint sought to be

filed in that action. 1 Following a hearing in October 2013, the state court denied

the motion. On November 4, 2013, the plaintiffs filed the instant suit in state court,

alleging breach of contract and the breach of the duty of good faith and fair

dealing. FedEx removed the action to federal court based on diversity jurisdiction

and subsequently filed a motion to dismiss, pursuant to Fed. R. Civ. P. (Rule)

12(b)(6). The district court dismissed the suit, concluding that the plaintiffs’

claims were barred by the applicable statute of limitations.

                                               II.

       We review de novo the district court’s grant of a motion to dismiss under

Rule 12(b)(6), accepting the allegations in the complaint as true and construing

them in the light most favorable to the plaintiff. Ironworkers Local Union 68 v.

AstraZeneca Pharm., LP, 634 F.3d 1352, 1359 (11th Cir. 2011). A Rule 12(b)(6)

1
 The Encarnacion matter, filed in Pinellas County state court, involved a multi-plaintiff action
brought on behalf of a number of former FedEx pick-up and delivery contractors alleging
wrongful termination of their operating agreements.
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dismissal on statute of limitations grounds is appropriate “if it is apparent from the

face of the complaint that the claim is time-barred.” La Grasta v. First Union Sec.,

Inc., 358 F.3d 840, 845 (11th Cir. 2004) (internal quotation marks omitted).

      In the instant appeal, the plaintiffs argue that the district court erred in

dismissing their claims as time-barred on grounds that: (1) the court should have

applied Florida’s five-year statute of limitations, as opposed to Pennsylvania’s

four-year limitations period; (2) the complaint was timely because it “relates back”

to a preexisting state court action; and (3) even if Pennsylvania’s four-year

limitations period applies, their suit should be considered timely based on the

discovery rule or equitable tolling. We consider each issue in turn.

                                          III.

   A. Statute of Limitations

      The parties dispute the governing law for the statute of limitations analysis.

The plaintiffs maintain that Florida law applies because that state has the most

“significant relationship” to the dispute. FedEx counters that Pennsylvania law

controls because the OA included a choice-of-law provision.

      “When it exercises jurisdiction based on diversity of citizenship, 28 U.S.C. §

1332, a federal court must apply the choice of law rules of the forum state to

determine which substantive law governs the action.” U.S. Fid. & Guar. Co. v.

Liberty Surplus Ins. Corp., 550 F.3d 1031, 1033 (11th Cir. 2008). Contrary to the

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plaintiffs’ suggestion, Florida courts consider the statute of limitations to be

substantive rather than procedural. See e.g., Fulton Cnty. Adm’r v. Sullivan, 753
So. 2d 549, 553 (Fla. 1999) (holding that “statutes of limitations are to be treated as

substantive law”); Merkle v. Robinson, 737 So. 2d 540, 542-43 (Fla. 1999) (noting

that Florida “treat[s] statute of limitation choice of law questions the same as

‘substantive’ choice of law questions”).

       Here, the OA between the plaintiffs and FedEx contained a choice-of-law

provision designating that the OA would be governed by Pennsylvania law. It is

well settled that absent a public policy prohibition, Florida courts will enforce a

choice-of-law provision in a contract “unless the law of the chosen forum

contravenes strong public policy.” Maxcess, Inc. v. Lucent Techs., Inc., 433 F.3d
1337, 1341 (11th Cir. 2005) (quoting Mazzoni Farms, Inc. v. E.I. DuPont de

Nemours & Co., 761 So. 2d 306, 311 (Fla. 2000)). The plaintiffs do not allege, and

there is no indication in the record, that the choice-of-law provision in the OA

conflicted with public policy in Florida. Therefore, the statute of limitations of the

parties’ chosen forum, Pennsylvania, applies in the instant case.2

       Under Pennsylvania law, parties have four years to commence “[a]n action

upon a contract, obligation or liability founded upon a writing.” 42 Pa. Cons. Stat.

2
 By contrast, where the parties have not contractually agreed to the applicable law, Florida
courts apply “the statute of limitations of the state having the most significant relationship to the
occurrence and parties.” Nguyen v. JP Morgan Chase Bank, NA, 709 F.3d 1342, 1346 n.3 (11th
Cir. 2013) (citing Merkle, 737 So. 3d at 542).
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§ 5525(a)(8) (2002). “The statute of limitations begins to run as soon as the right

to institute and maintain a suit arises; lack of knowledge, mistake or

misunderstanding do not toll the running of the statute of limitations.” Montanya

v. McGonegal, 757 A.2d 947, 950 (Pa. 2000) (quotation omitted). As such, the

plaintiffs were required to file their breach-of-contract suit within the requisite

four-year limitations period under Pennsylvania law. 3

       The plaintiffs asserted in their complaint that FedEx committed a breach by

terminating the OA on October 5, 2009. As such, they became aware of their right

to file suit as of that date, and the four-year limitations period expired on October

5, 2013. Because the plaintiffs did not initiate this action until November 4,

2013—almost a month after the expiration of the limitations period—the lawsuit

was untimely, and the district court correctly dismissed the suit with prejudice.

    B. Encarnacion Proceeding

       In an attempt to persuade this court to the contrary, the plaintiffs argue that

their instant suit should be considered timely because they moved for leave to join

the Encarnacion action on August 16, 2012, within the four-year limitations

period. In the first instance, the plaintiffs failed to acknowledge that they were

unsuccessful in their bid to join the Encarnacion suit because the state court denied

3
 To the extent that the plaintiffs intended to plead an independent claim for breach of the duty of
good faith and fair dealing, the same four-year statute of limitations applies because that claim is
predicated upon “[a]n action upon a contract, obligation or liability founded upon a writing.” 42
Pa. Cons. Stat. § 5525(a)(8) (2002).
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their motion to amend and the state appellate court dismissed their appeal.

Moreover, although the plaintiffs rely on Florida law to argue that the filing of a

motion to amend satisfies the applicable statute of limitations, as discussed above,

the parties contracted to have Pennsylvania law govern their instant dispute.

      Under Pennsylvania law, the filing of a prior complaint or a motion to

amend does not toll the statute of limitations for a subsequently filed complaint

involving the same allegations. See Aivazoglou v. Drever Furnaces, 613 A.2d 595,

598 (Pa. 1992) (concluding that plaintiffs’ claims were time-barred because the

amended complaint was filed after the running of the statute of limitations, even

though the motion to amend had been filed prior to the expiration of the limitations

period). Thus, the district court properly rejected the plaintiffs’ argument that their

instant complaint “relates back” to their attempt to join the Encarnacion action.

   C. Discovery Rule/Equitable Tolling

      We are also unpersuaded by the plaintiffs’ assertion that the four-year statute

of limitations should be tolled under Pennsylvania law by either the discovery rule

or equitable tolling. The discovery rule—which applies “to toll the statute of

limitations in any case where a party neither knows nor reasonably should have

known of his injury and its cause at the time his right to institute suit arises”—is

inapplicable here, as the plaintiffs do not dispute that they were aware of their

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alleged injury on the date that the OA was terminated. Fine v. Checcio, 870 A.2d
850, 859 (Pa. 2005).

       The plaintiffs counter that the limitations period only began to run when

they learned that FedEx had waived the terms of the arbitration provision in the

OA and that they had a litigable claim. 4 But the relevant inquiry is when the

plaintiffs knew or should have known of the existence and cause of their injury; it

is irrelevant when the plaintiffs identified their exact claims or the appropriate

forum for advancing their arguments. See Romah v. Hygienic Sanitation Co., 705
A.2d 841, 857 (Pa. Super. Ct. 1997), aff’d 737 A.2d 249 (Pa. 1999) (“[W]ith

respect to knowledge of a claim, plaintiffs need not know that they have a cause of

action, or that the injury was caused by another party’s wrongful conduct, for once

a plaintiff possesses the salient facts concerning the occurrence of his injury and

who or what caused it, he has the ability to investigate and pursue his claim.”)

(internal quotation marks and emphasis omitted)).

       Likewise, equitable tolling is not warranted because the plaintiffs cannot

show that FedEx in any way acted fraudulently or concealed facts in an attempt to

prevent them from filing their claim. See Molineux v. Reed, 532 A.2d 792, 794

(Pa. 1987) (Pennsylvania law recognizes that fraudulent concealment by a potential

defendant can result in the tolling of the statute of limitations). The plaintiffs

4
  The plaintiffs never specify when they learned that FedEx had waived the arbitration provision
in the OA.
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maintain that they were unaware that FedEx would agree to waive the OA’s

arbitration provision. But they offer no explanation to account for their failure to

pursue relief through arbitration or the court system after they learned that FedEx

had terminated the OA on October 5, 2009. Instead, the plaintiffs waited almost

three years before filing an unsuccessful motion to join the Encarnacion

proceeding in state court. Accordingly, the district court correctly determined that

equitable tolling was not warranted under these circumstances.

      AFFIRMED.

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