Court Opinion

ID: 2976138
Source: CourtListenerOpinion
Date Created: 2015-09-22 17:46:45.260611+00
Date Added: 2024-06-11T11:34:53.648224
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NOT RECOMMENDED FOR FULL-TEXT PUBLICATION
                            File Name: 08a0021n.06
                             Filed: January 8, 2008

                                            No. 06-6399

                            UNITED STATES COURT OF APPEALS
                                 FOR THE SIXTH CIRCUIT

       CGH TRANSPORT, INC.,                       )
                                                  )
             Plaintiff-Appellant,                 )
                                                  )
                       v.                         ) ON APPEAL FROM THE UNITED
                                                  ) STATES DISTRICT COURT FOR THE
   QUEBECOR WORLD, INC., et al.                   ) EASTERN DISTRICT OF KENTUCKY
                                                  )
            Defendants-Appellees.                 )
                                                  )
                                                  )

Before: BOGGS, Chief Judge, GIBBONS, Circuit Judge, and BELL, Chief District Judge.*

        JULIA SMITH GIBBONS, Circuit Judge. This case arose out of a billing dispute in

which one company provided interstate and intrastate shipping services to the other company.

Plaintiff-appellant CGH Transport, Inc. (“CGH”) appeals the district court's (1) partial grant of a

motion to dismiss, (2) partial grant of summary judgment, (3) denial of a motion to reconsider, and

(4) denial of several motions to amend in favor of defendants-appellees Quebecor World, Inc.

(“World”) and Quebecor World Logistics, Inc. (“Logistics”). For the reasons set forth below, we

affirm the rulings of the district court.

        *
         The Honorable Robert Holmes Bell, Chief United States District Judge for the Western
District of Michigan, sitting by designation.
                                                    I.

       This case involves a billing dispute between CGH and World and Logistics. In 1997,

pursuant to an agreement between the parties, CGH began supplying both interstate and intrastate

shipping services to Logistics.1 CGH alleges that in 2000, 2001, and 2002 the parties entered into

agreements for the provision of these shipping services. It further alleges that, although it provided

the agreed-upon services, payment was not remitted as required.

       The shipments about which payment is disputed were delivered in 2000, 2001, and 2002.

Of these approximately 750 shipments, all but nine involved interstate shipments and were shipped

from a specific location in one state to a specific location in another state. In addition, none of the

shipments involved either a “vehicle used only to distribute newspapers” or “transportation of

passengers . . . incidental to transportation by aircraft, transportation of property . . . as part of a

continuous movement, or transportation . . . in lieu of . . . aircraft due to circumstances beyond the

control of the carrier or shipper.” 49 U.S.C. § 13506(a)(7), (8).

       CGH initiated this action by filing a verified complaint in Kentucky state court on April 29,

2005. World filed a notice of removal on May 23, 2005. The district court denied CGH’s motion

to remand on August 19, 2005.

       On April 24, 2006, the district court granted Logistics’ motion for partial dismissal and

granted in part and denied in part World’s motion for summary judgment. The court determined that

49 U.S.C. § 14705(a) required that a carrier commence an action to recover charges for shipping

services within eighteen months of the claim’s accrual, which is the date of delivery, 49 U.S.C. §

        1
            World is the corporate great-grandparent of Logistics.

                                                    2
14705(g). The district court reasoned that because CGH transported goods across state lines, its

interstate shipments were subject to this statute of limitations. Thus, the district court reasoned that

CGH was barred from seeking payment for interstate shipping services more than eighteen months

after accrual.

        On July 25, 2006, the district court denied both CGH’s motion to reconsider and its motions

for leave to file a second and third amended complaint. As to the motion to reconsider, it explained

that CGH now sought to plead exemptions from the statute of limitations in an amended complaint;

because these exceptions did not have to be pled in a complaint, the argument that they applied could

have been raised earlier, such as in opposition to the defendants’ motion for summary judgment and

dismissal. It denied the motions to amend because it determined both of the proposed complaints

merely alleged additional facts that were unnecessary to resolving the dispute between the parties.

        On September 25, 2006, the district count entered an order clarifying that the April 24, 2006

order related to interstate shipments only and the only claims still at issue after its entry were the nine

intrastate claims. The order noted that the parties had settled the claims relating to the intrastate

shipments. Accordingly, the court dismissed the intrastate shipment claims with prejudice and

indicated that the orders of April 24 and July 25 were final and appealable.

                                                    II.

                                                    A.

                                                    1.

        We review a district court’s grant of a motion to dismiss pursuant to Federal Rule of Civil

Procedure 12(b)(6) de novo. Kottmyer v. Maas, 436 F.3d 684, 688 (6th Cir. 2006). The Supreme

                                                    3
Court recently clarified the pleading standard necessary to survive a Rule 12(b)(6) motion. Bell Atl.

Corp. v. Twombly, __U.S. __, 127 S. Ct. 1955 (2007). It explained that the factual allegations must

“raise a right to relief above the speculative level.” Id. at 1965.2 A complaint must contain facts

sufficient to “state a claim to relief that is plausible on its face.” Id. at 1974. “In reviewing a motion

to dismiss, we construe the complaint in the light most favorable to the plaintiff, accept its

allegations as true, and draw all reasonable inferences in favor of the plaintiff.” Directv, Inc. v.

Treesh, 487 F.3d 471, 476 (6th Cir. 2007) (citation omitted). In evaluating a motion to dismiss, a

court generally is limited to the complaint and exhibits attached thereto. Amini v. Oberlin Coll., 259
F.3d 493, 502 (6th Cir. 2001).

                                                    2.

        We review a district court’s decision to grant summary judgment de novo. Pagan v. Fruchey,

492 F.3d 766, 770 (6th Cir. 2007). Summary judgment may be granted only if there are no genuine

issues of material fact and one party is entitled to a judgment as a matter of law. Fed. R. Civ. P.

56(c). The moving party bears the initial burden of demonstrating the absence of any genuine issue

of material fact. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). To support its motion, the

moving party may show “that there is an absence of evidence to support the nonmoving party's case.”

Id. at 325.

        Once the moving party satisfies its initial burden, the burden shifts to the nonmoving party

to set forth specific facts showing a triable issue of material fact. Matsushita Elec. Indus. Co. v.

        2
          In Twombly, the Supreme Court abrogated the pleading standard articulated in Conley v.
Gibson, 355 U.S. 41, 45-46 (1957) (that a complaint fails to state a claim when it “appears beyond
doubt that the plaintiff can prove no set of facts in support of his claim which would entitle him to
relief”), stating it has “earned its retirement,” and calling it “best forgotten as an incomplete, negative
gloss on an accepted pleading standard.” Twombly, 127 S. Ct. at 1969.

                                                    4
Zenith Radio Corp., 475 U.S. 574, 587 (1986). See also Fed. R. Civ. P. 56(e). “The mere existence

of a scintilla of evidence in support of the plaintiff's position will be insufficient [to defeat a motion

for summary judgment]; there must be evidence on which the jury could reasonably find for the

plaintiff.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 252 (1986). In reviewing a district court’s

decision to grant summary judgment, we view all the facts and the inferences drawn therefrom in

the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co., 475 U.S. at 587.

                                                   B.

        On appeal, in its statement of the case and its statement of facts, CGH devotes considerable

time to discovery disputes; it argues it did not receive sufficient discovery. For example, CGH

argues the district court did not timely enter a scheduling order that accompanied the parties’ Rule

26(f) report, which slowed down the discovery process. It also argues that World’s summary

judgment motion should not have been granted in part because it did not have the opportunity to

conduct sufficient discovery. These arguments, however, are not properly before us because CGH

did not raise these discovery-related concerns in the district court by, for example, either bringing

a motion to compel discovery or filing an affidavit pursuant to Federal Rule of Civil Procedure 56(f).

See Harvey v. Great Seneca Fin. Corp., 453 F.3d 324, 329 (6th Cir. 2006) (“Allowing [plaintiff] to

present a new theory of her case on appeal that was not alleged below would permit her two bites

at the apple, a practice that would be very disruptive of orderly trial procedure.”). There appears to

be no reason that CGH could not have raised these arguments in the district court. See Mich. Bell

Tel. Co. v. Strand, 305 F.3d 580, 589-90 (6th Cir. 2002) (declining to address a new argument on

appeal where a party had knowledge of and opportunity to assert the new theory in the district court).

                                                    5
       Assuming CGH felt it could not respond adequately to either World’s motion for summary

judgment or Logistics’ partial motion to dismiss3 due to insufficient discovery, it was required to

notify the district court of this problem. Federal Rule of Civil Procedure 56(f) provides:

       Should it appear from the affidavits of a party opposing the motion that the party
       cannot for reasons stated present by affidavit facts essential to justify the party's
       opposition, the court may refuse the application for judgment or may order a
       continuance to permit affidavits to be obtained or depositions to be taken or
       discovery to be had or may make such other order as is just.

CGH, the party seeking additional discovery, had the burden to show that discovery was necessary.

See Summers v. Leis, 368 F.3d 881, 887 (6th Cir. 2004). As CGH failed to raise this argument

before the district court, we do not consider it here.

                                                  C.

       CGH argues the district court erred in determining that the interstate shipment claims are

barred by a statute of limitations. “A carrier providing transportation or service subject to

jurisdiction under chapter 135 must begin a civil action to recover charges for transportation or

service provided by the carrier within 18 months after the claim accrues.” 49 U.S.C. § 14705(a).

A claim regarding a shipment of property accrues “on delivery or tender of delivery by the carrier.”

49 U.S.C. § 14705(g). The “statute is complete and unambiguous.” Emmert Indus. Corp. v. Artisan

Assocs., Inc., 497 F.3d 982, 987 (9th Cir. 2007).

       Jurisdiction exists under chapter 135 where goods are transported across state lines. 49

U.S.C. § 13501(1). See also Martin Moving & Storage, Inc. v. Baker, 1999 WL 33756649, at *1

(W.D. Ky. 1999). There is no jurisdiction under chapter 135 over “a motor vehicle used only to

       3
       CGH attached evidence to its opposition to the motion for partial dismissal and therefore
presumably understood that the motion would likely be treated as a motion for summary judgment.

                                                  6
distribute newspapers”or over “transportation of property (including baggage) by motor vehicle as

part of a continuous movement which, prior or subsequent to such part of the continuous movement,

has been or will be transported by an air carrier or (to the extent so agreed by the United States and

approved by the Secretary) by a foreign air carrier.” See 49 U.S.C. § 13506(a)(7), (8)(B).

       CGH filed its complaint on April 29, 2005. It attached as an exhibit to its complaint a

spreadsheet containing information including the delivery date of the payments at issue. Each of

these delivery dates falls in 2000, 2001, or 2002; all goods were therefore delivered outside the 18-

month period. Thus, to the extent these shipments were for goods transported across state lines and

no exclusions apply, the statute of limitations bars CGH’s claim. 49 U.S.C. § 14705(a). The

exclusions will be discussed below.

                                                  1.

       CGH argues that the district court erred in granting Logistics’ motion for partial dismissal

because in its complaint it “stated under oath that the shipments were exempt from applicable federal

law.” Specifically, the amended complaint states, “These shipments consisted of exempt shipments

pursuant to the federal Motor Carrier Safety Administration’s regulations.”4 That the shipments

were exempt is not a factual allegation but a legal conclusion. Unlike factual allegations, “we need

not accept as true legal conclusions or unwarranted factual inferences.” Directv, Inc., 487 F.3d at

476 (citation omitted). Thus, we are not bound by CGH’s conclusion that its shipments are exempt

pursuant to the Motor Carrier Safety Administration regulations.

       4
         In addition, the verified complaint, in which Logistics is not named as a defendant, states,
“These Shipments consisted of regulated and exempt shipments, tendered to Plaintiff in its capacity
as a freight broker and/or shipped, pursuant to Federal Motor Carrier Safety Administration
regulations and other applicable state and federal laws.”

                                                  7
        CGH contends on appeal that when it stated “that a portion of these shipments were exempt

from federal law in the pleadings,” it relied upon 49 U.S.C. § 13506(a)(7) and (8)(B). It argues that

a factual determination was necessary to determine whether the shipments fit within these

exemptions. CGH, however, failed to timely raise this argument below as it only advanced different

arguments in opposition to the motion for partial dismissal.5 Thus, we do not consider the argument

that the 49 U.S.C. § 13506(a)(7) and 8(B) exemptions apply.

        CGH also argues that the district court should have examined facts in response to the motion

to dismiss because it needed “evidentiary proof of the nature of the shipments” before it could

determine whether to apply the statute of limitations defense to the shipments. Specifically, it

argues, the district court needed to evaluate the evidence in order to determine which shipments were

interstate and which were intrastate. CGH is correct that the district court needed to consider

evidence outside the pleadings in order to make such a determination because the spreadsheet

attached to the complaint, a document that may be reviewed in deciding a motion to dismiss, Amini,
259 F.3d at 502, does not show each shipment’s origin and destination.6 In addition, CGH attached

evidence to its opposition to the motion for partial dismissal and Logistics submitted an affidavit

along with its reply.7 In its reply to the motion to dismiss, Logistics requested that the district court

        5
            CGH first raised this argument in its motion for reconsideration.
        6
        In its motion to dismiss before the district court, Logistics argued that the Load Rate
Agreements referenced in the complaint and summarized in Exhibit A to the complaint identified
the nine intrastate shipments. These documents could have been properly considered in response
to a motion to dismiss. See Greenberg v. Life Insurance Co. of Va., 177 F.3d 507, 514 (6th Cir.
1999). Logistics, however, failed to attach the Load Rate Agreements to its motion to dismiss.
Thus, the district court could not have relied upon them.
        7
        Logistics requested that the district court consider its affidavit only in the event it converted
the motion to dismiss into a motion for summary judgment.

                                                    8
strike references to CGH’s evidence and not convert the motion into a motion for summary

judgment.

       If on a 12(b)(6) motion, “matters outside the pleading are presented to and not excluded by

the court, the motion shall be treated as one for summary judgment.” Fed. R. Civ. P. 12(b). While

the district court did not address whether the motion to dismiss should be converted into a motion

for summary judgment, it stated, “For the purposes of this motion, the defendants allege that all but

nine of the plaintiff’s invoices involve interstate transportation.” Logistics and World, however,

included that information in the Affidavit of Kevin Neis. The district court thus looked outside the

pleadings in making its decision and erred by failing to convert the motion to dismiss to a motion

for summary judgment.8 We thus evaluate the motion under summary judgment standards and

conduct de novo review.

       CGH does not raise a genuine issue of material fact. Logistics met its initial burden by

providing evidence that the shipments at issue involved the interstate shipment of goods. CGH

provided no evidence to rebut this evidence and has not raised a genuine issue of material fact.

Although the district court should have evaluated Logistics’ motion under the summary judgment

standard, it properly granted the motion.

       8
        A district court must provide a party with an opportunity to respond with relevant evidence
before converting a motion to dismiss pursuant to Rule 12(b)(6) into a motion for summary
judgment. See Briggs v. Ohio Elections Comm’n, 61 F.3d 487, 493 (6th Cir. 1995). As CGH
submitted evidence along with its opposition, it had an opportunity to respond and submit relevant
evidence. See Salehpour v. Univ. of Tenn., 159 F.3d 199, 204 (6th Cir. 1998) (holding where
defendants filed a motion to dismiss or in the alternative for summary judgment and the plaintiff
responded with evidence, he had an opportunity to respond).

                                                 9
                                                   2.

        World’s summary judgment motion requested judgment based on the same statute of

limitations issue discussed above in relation to Logistics’ motion. The district court properly granted

in part the motion for the reasons explained above in the discussion as to Logistics because CGH

failed to introduce evidence that creates a genuine issue of material fact regarding the applicability

of the statute of limitations.9

                                                  D.

        CGH next argues that the district court erred by denying its motion for reconsideration. The

denial of a motion for reconsideration generally is reviewed for abuse of discretion, but it is reviewed

de novo when summary judgment is at stake. Sommer v. Davis, 317 F.3d 686, 691 (6th Cir. 2003).

Although it is unclear whether the district court analyzed the motion to reconsider pursuant to

Federal Rule of Civil Procedure 59(e) or Federal Rule of Civil Procedure 60(b), the district court’s

denial was appropriate in either case.10

        A motion to alter or amend judgment pursuant to Federal Rule of Civil Procedure 59(e) may

be granted (1) to correct a clear error of law; (2) to account for newly discovered evidence or an

        9
        The district court also denied in part the motion for summary judgment to the extent World
argued it had no relationship with CGH and was not a proper party to the lawsuit. As all but nine
shipments are barred by the statute of limitations and the nine remaining claims were settled and
have not been appealed, we do not reach this issue.
        10
          In its motion before the district court, CGH did not specify whether it brought its motion
under Federal Rule of Procedure 59(e) or Federal Rule of Civil Procedure 60(b). The motion was
filed ten days after entry of the order granting the motion for partial dismissal and granting in part
the motion for summary judgment , as required by Rule 59(e), and the district court appears to have
considered the motion under Rule 59(e). Rule 59(e), however, applies to judgments and final orders
and CGH sought reconsideration of an order granting summary judgment in part while other claims
were pending and no final judgment had been entered.

                                                  10
intervening change in the controlling law; or (3) to otherwise prevent manifest injustice. GenCorp,

Inc. v. Am. Int'l Underwriters, 178 F.3d 804, 834 (6th Cir. 1999). “Newly discovered evidence”

must have been previously unavailable. Id. “Further, under Rule 59(e), parties cannot use a motion

for reconsideration to raise new legal arguments that could have been raised before a judgment was

issued.” Roger Miller Music, Inc. v. Sony/ATV Publishing, LLC, 477 F.3d 383, 395 (6th Cir. 2007)

(citation omitted).

       Under Federal Rule of Civil Procedure 60(b), a party may seek relief from a final judgment

or order on many grounds including mistake, inadvertence, excusable neglect, “newly discovered

evidence which by diligence could not have been discovered in time to move for a new trial under

Rule 59(b),” fraud, or “any other reason justifying relief.”        “[R]elief under Rule 60(b) is

‘circumscribed by public policy favoring finality of judgments and termination of litigation.’” Blue

Diamond Coal Co. v. Trustees of UMWA Combined Ben. Fund, 249 F.3d 519, 524 (6th Cir. 2001)

(quoting Waifersong Ltd. v. Classic Music Vending, 976 F.2d 290, 292 (6th Cir. 1992)). “In

reviewing an order denying Rule 60(b) relief, we have no occasion to review the underlying

judgment . . . . Instead, we merely inquire as to whether one of the specified circumstances exists.”

Feathers v. Chevron U.S.A., Inc., 141 F.3d 264, 268 (6th Cir. 1998). Furthermore, the standard for

granting a Rule 60(b) motion is higher than the standard for a Rule 59(e) motion. Id.

       CGH argues that the district court erred in not reconsidering its order in light of additional

affidavits “regarding the nature of the shipments” and that manifest injustice resulted. In its motion

to reconsider, CGH requested reconsideration because an affidavit included indicated that an

exclusion under 49 U.S.C. § 13506(8)(b) applied. Under Rule 59(e), however, CGH has not shown

that the newly discovered evidence “was previously unavailable.” See GenCorp, Inc., 178 F.3d at

                                                 11
834. It is hard to imagine how an affidavit from one of its own witnesses would have been

previously unavailable to CGH, and CGH has not explained why it failed to introduce this evidence

in opposition to summary judgment. Instead it appears that CGH attempted to introduce evidence

in support of new legal arguments that should have been raised earlier. See Roger Miller Music, Inc.,
477 F.3d at 395. Nor is there any reason that manifest injustice would result from the denial of the

motion. Similarly, under Rule 60(b), none of the circumstances in which relief is appropriate exist.

The district court properly denied CGH’s motion for reconsideration.

                                                 E.

         Finally, CGH argues the district court erred by denying its motion to amend. The district

court’s denial of a motion to amend a complaint is reviewed for abuse of discretion. Miller v. Admin.

Office of Courts, 448 F.3d 887, 898 (6th Cir. 2006). “An abuse of discretion is defined as ‘a definite

and firm conviction that the trial court committed a clear error of judgment.’” Harlamert v. World

Finer Foods, Inc., 489 F.3d 767, 773 (6th Cir. 2007) (quoting Trepel v. Roadway Exp., Inc., 194
F.3d 708, 716 (6th Cir. 1999)).

         “In deciding whether to allow an amendment, the court should consider the delay in filing,

the lack of notice to the opposing party, bad faith by the moving party, repeated failure to cure

deficiencies by previous amendments, undue prejudice to the opposing party, and futility of

amendment.” Perkins v. Am. Elec. Power Fuel Supply, Inc., 246 F.3d 593, 605 (6th Cir. 2001).

“When amendment is sought at a late stage in the litigation, there is an increased burden to show

justification for failing to move earlier.” Wade v. Knoxville Utils. Bd., 259 F.3d 452, 459 (6th Cir.

2001).

                                                 12
       The district court did not abuse its discretion in denying the motions to amend. It found that

allowing the amendments would be futile, because once it had denied the motion to reconsider,

“[t]he additional factual allegations [were] not necessary for the resolution of the dispute between

the parties.” It also concluded that the proposed amended complaints do not “advance additional

claims, join additional parties, or otherwise put the defendants on notice that they will have to defend

against additional claims.” The district court was correct in these conclusions. Furthermore, World

and Logistics would suffer undue prejudice if CGH were allowed to amend its complaint after the

entry of summary judgment. See Parry v. Mohawk Motors of Mich., Inc., 236 F.3d 299, 306-07 (6th

Cir. 2000) (upholding denial of leave to amend complaint where amendment was sought more than

a year after original complaint was filed, summary judgment had been granted to defendants two

months earlier, and plaintiff was attempting to add a new legal theory). Finally, CGH has not offered

a justification for the late filing of its motions to amend. See Wade, 259 F.3d at 459. Accordingly,

the district court did not err by denying CGH’s motion to amend.

                                                  III.

       For the foregoing reasons, we affirm the district court’s decision.

                                                  13