Heniff Transportation System, L.L.C. v. Trimac Transportation Services, Inc. , 847 F.3d 187 ( 2017 )

Case: 16-40553 Document: 00513855085 Page: 1 Date Filed: 01/30/2017
IN THE UNITED STATES COURT OF APPEALS
FOR THE FIFTH CIRCUIT
No. 16-40553 United States Court of Appeals
Fifth Circuit
FILED
HENIFF TRANSPORTATION SYSTEMS, L.L.C., January 30, 2017
Lyle W. Cayce
Plaintiff - Appellant Clerk
v.
TRIMAC TRANSPORTATION SERVICES, INCORPORATED,
Defendant - Appellee
Appeal from the United States District Court
for the Eastern District of Texas
Before JOLLY, HIGGINBOTHAM, and GRAVES, Circuit Judges.
E. GRADY JOLLY, Circuit Judge:
Heniff Transportation Systems, LLC (“Heniff”) was hired to transport
chemicals from Texas to Illinois. It in turn hired Trimac Transportation
Services, Inc. (“Trimac”) to clean the tanker prior to the trip. The cleaning was
not performed correctly, and the chemicals became contaminated. Heniff sued
Trimac for the resulting damages. The district court dismissed Heniff’s state
law claims, finding that they were preempted by the Carmack Amendment,
codified in relevant part at 49 U.S.C. § 14706 et seq., which establishes a
federal liability regime for claims concerning goods damaged or lost during
transportation in interstate commerce. We agree with the district court that
Heniff’s claims are preempted by the Carmack Amendment because the service
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that Trimac provided, a tanker wash, was a “service[] related to [the]
movement [of property in interstate commerce],” 49 U.S.C. § 13102(23).
Accordingly, we affirm.
I.
Heniff provides transportation and product delivery services. Trimac
provides a wide variety of transportation and delivery services including,
among other things, cleaning services for tanker-trailers used by other
transportation companies.
In November 2011, Heniff entered into an agreement with Huntsman
Corporation (“Huntsman”), a chemical producer, to transport a load of
chemicals from its plant in Texas to its customer, Lambent Technologies Corp.
(“Lambent”), in Illinois. Knowing the chemicals might become contaminated
if exposed to any cleaning agents or residue, Huntsman required that the
tanker-trailer used for the transportation undergo a very thorough “Kosher
wash.” This wash was specified in the bill of lading that Huntsman issued.
Heniff contracted with Trimac to have its tanker washed the day before
the trip. This practice was routine; Heniff rented storage space from Trimac
and regularly used Trimac’s cleaning services for its tankers. For whatever
reason, the tanker did not receive a proper Kosher wash. 1 As a result of the
inadequate wash, this new load of chemicals became contaminated.
Additionally, after the contaminated chemicals were delivered and entered
Lambent’s facilities, the chemicals in turn contaminated other chemicals and
damaged Lambent’s equipment.
A few months later, Heniff, along with its insurer, Hartford Fire
Insurance Company (“Hartford”), settled with Lambent for the damage caused
1 The wash receipt that Trimac issued states that it administered a “special clean.”
The parties dispute what exactly went wrong with respect to which wash (a “Kosher wash”
or a “special clean”) was ordered, or whether the distinction had any practical impact.
2
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by the contaminated shipment. They paid a combined $30,394 for the spoiled
cargo and $208,516 for other damages to Lambent’s property.
II.
In February 2015, Heniff filed this suit against Trimac in federal court
in Illinois. 2 It alleged several state law claims relating to the contamination
incident, as well as a federal claim for liability apportionment under the
Carmack Amendment, see 49 U.S.C. § 14706(b). The court transferred the case
to the Eastern District of Texas.
Trimac then moved for partial summary judgment on the state law
claims. The district court granted the motion and held that all of Heniff’s state
law claims are preempted by the Carmack Amendment. It specifically found
that the Carmack Amendment applied because Trimac was acting as a
“carrier” under the statute because the tank-washing service that Trimac
provided was a “service[] related to [the] movement [of property in interstate
commerce].” See 49 U.S.C. §§ 13102(3), 13102(14), 13102(23).
Several months later, Trimac moved for summary judgment on the
remaining Carmack Amendment apportionment claim. The district court
granted that motion as well, finding that Heniff failed to comply with the
procedural requirements outlined in the Carmack Amendment.
Heniff appeals the district court’s holding that the state law claims are
preempted. 3
2Heniff and Hartford, in its capacity as subrogee of Heniff, initially jointly filed a suit
asserting substantially identical allegations against Trimac in state court in Illinois. After
that case was removed to federal court, both parties voluntarily dismissed their claims
without prejudice. Hartford later refiled its claims, this time by itself, in state court in Texas.
After that case was removed to federal court, and prior to Heniff’s filing of the instant case,
Hartford settled its claims with Trimac and voluntarily dismissed that case.
3 Heniff does not appeal the finding that its federal apportionment claim failed due
to failure to comply with the Carmack Amendment’s procedural requirements.
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III.
We review the grant of a motion for summary judgment de novo,
applying the same legal standards as the district court. Lifecare Hosps., Inc.
v. Health Plus of Louisiana, Inc., 418 F.3d 436, 439 (5th Cir. 2005). We may
affirm the district court’s ruling on any grounds supported by the record. Id.
Summary judgment is proper when the movant shows that there is no genuine
dispute as to any material fact and the movant is entitled to judgment as a
matter of law. Fed. R. Civ. P. 56(a). In reviewing an appeal from summary
judgment, we “view the facts in the light most favorable to the non-moving
party and draw all reasonable inferences in its favor.” See Deville v. Marcantel,
567 F.3d 156, 163–64 (5th Cir. 2009).
IV.
The only issue in this appeal is whether Heniff’s state law claims are
preempted by the Carmack Amendment. We hold that they are, and so affirm.
A.
The Carmack Amendment establishes the standard for imposing liability
on a motor carrier for the actual loss or injury to property transported through
interstate commerce. Distribuidora Mari Jose, S.A. de C.V. v. Transmaritime,
Inc., 738 F.3d 703, 706 (5th Cir. 2013). The Carmack Amendment generally
preempts state law claims arising out of the shipment of goods by interstate
carriers. Id. “The purpose of the Amendment is to establish [] uniform federal
guidelines designed in part to remove the uncertainty surrounding a carrier’s
liability when damage occurs to a shipper’s interstate shipment.” Id. (citations
and quotations omitted). The Amendment “provide[s] the exclusive cause of
action for loss or damages to goods arising from the interstate transportation
of those goods by a common carrier.” Hoskins v. Bekins Van Lines, 343 F.3d
769, 778 (5th Cir. 2003) (emphasis omitted). This Court has repeatedly
recognized the “broad reach” of the Carmack Amendment. See, e.g., id. at 777.
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The Carmack Amendment provides, in relevant part:
(a) General liability.--
(1) Motor carriers and freight forwarders.--A carrier
providing transportation or service subject to jurisdiction under
subchapter I or III of chapter 135 shall issue a receipt or bill of
lading for property it receives 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 or from a place in
the United States to a place in an adjacent foreign country when
transported under a through bill of lading and, except in the case
of a freight forwarder, applies to property reconsigned or diverted
under a tariff under section 13702. Failure to issue a receipt or bill
of lading does not affect the liability of a carrier. . . .
(b) Apportionment.--The carrier issuing the receipt or bill of
lading under subsection (a) of this section or delivering the
property for which the receipt or bill of lading was issued is entitled
to recover from the carrier over whose line or route the loss or
injury occurred the amount required to be paid to the owners of
the property, as evidenced by a receipt, judgment, or transcript,
and the amount of its expenses reasonably incurred in defending a
civil action brought by that person.
49 U.S.C. § 14706. The operative term “carrier” is defined as “a motor carrier,
a water carrier, and a freight forwarder.” 49 U.S.C. § 13102(3). “Motor carrier”
is further defined as “a person providing motor vehicle transportation for
compensation.” 49 U.S.C. § 13102(14). The term “transportation” “includes”
“equipment of any kind related to the movement of passengers or property,” as
well as “services related to that movement, including arranging for, receipt,
delivery, elevation, transfer in transit, refrigeration, icing, ventilation, storage,
handling, packing, unpacking, and interchange of passengers and property.”
49 U.S.C. § 13102(23).
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In other words, one who provides motor-vehicle-related “services related
to [the] movement [of passengers or property in interstate commerce],” 49
U.S.C. § 13102(23), provides a “service subject to [the] jurisdiction” of the
Carmack Amendment, see 49 U.S.C. § 14706(a), and any state law claims
asserting “loss or damages to goods” in connection to those services are
preempted by the Amendment. Hoskins, 343 F.3d at 778 & n.7; see also
Transmaritime, 738 F.3d at 706.
B.
We hold that the service that Trimac provided—cleaning Heniff’s tanker-
trailer so that it could be used to transport chemicals from Texas to Illinois—
was a “service[ ] related to [the] movement [of passengers or property in
interstate commerce].” 49 U.S.C. § 13102(23). Accordingly, Trimac was
providing “transportation,” 49 U.S.C. § 13102(23), and was thus acting as a
“motor carrier,” 49 U.S.C. § 13102(14), and was thus a “carrier,” 49 U.S.C.
§ 13102(3), and was thus subject to the Carmack Amendment, see 49 U.S.C.
§ 14706(a)(1) (providing that a “carrier . . . that delivers the property and is
providing transportation or service subject to jurisdiction under [the Carmack
Amendment] . . . [is] liable to the person entitled to recover”). Heniff’s state
law claims pertaining to the damage of goods caused by these services, which
are the subject of this appeal, are thus preempted by the Amendment. See 49
U.S.C. § 14706(a)(1); Transmaritime, 738 F.3d at 706.
Heniff makes, in effect, two arguments that its claims are not preempted
by the Carmack Amendment. Neither is compelling.
First, Heniff argues that the tanker wash service that Trimac provided
was not a “service[] related to [the] movement [of passengers or property in
interstate commerce],” because it is dissimilar to the examples of services
provided in the statute.
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But the plain language of the statute compels a finding that the tanker
wash was such a “service.” “Transportation” “includes . . . services related to
[the] movement [of passengers or property in interstate commerce], including
arranging for, receipt, delivery, elevation, transfer in transit, refrigeration,
icing, ventilation, storage, handling, packing, unpacking, and interchange of
passengers and property.” 49 U.S.C. § 13102(23) (emphasis added). As the
district court correctly noted, the phrase “including” in the statute indicates
that the examples of “services” listed in the statute are an illustrative and non-
exhaustive list. See Include, Black’s Law Dictionary (10th ed. 2014) (“The
participle including typically indicates a partial list . . . But some drafters use
phrases such as including without limitation and including but not limited to—
which mean the same thing.”). Washing a tanker-trailer using industrial
cleaning methods so that the tanker-trailer may transport chemicals from one
state to another is plainly a “service[] related to [the] movement [of passengers
or property in interstate commerce].” 49 U.S.C. § 13102(23).
Indeed, the “Kosher wash” was so critical to this shipment of goods that
the bill of lading explicitly required that such a wash occur prior to shipment.
Further, the service—that is, preparing a vessel for safe transport of the
cargo—is analogous to several of the examples listed in the statute, including
“arranging for,” “handling,” “refrigeration,” “icing,” and “ventilation.” This
holding is also consistent with the “broad reach” that courts assign to the
Carmack Amendment, Hoskins, 343 F.3d at 777, as well as the purpose of the
Amendment: a uniform liability regime for causes of action stemming from “the
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loss or damages to goods arising from the interstate transportation of those
goods by a common carrier.” Id. at 778 (emphasis omitted). 4
Second, Heniff argues that because Trimac was never a party to any bill
of lading—the bill of lading in this case was between Heniff and Huntsman—
and because the bill of lading was not actually issued until after the wash was
performed, Trimac is not subject to the Carmack Amendment.
But this argument ignores the plain language of the Amendment, which
states that “[f]ailure to issue a receipt or bill of lading does not affect the
liability of a carrier.” 49 U.S.C. § 14706(a)(1); see also Kawasaki Kisen Kaisha
Ltd. v. Regal-Beloit Corp., 561 U.S. 89, 102–03 (2010) (“Carmack applies only
to transport of property for which Carmack requires a receiving carrier to issue
a bill of lading, regardless of whether that carrier erroneously fails to issue
such a bill . . . The decisive question is not whether the . . . carrier in fact issued
a Carmack bill but rather whether that carrier was required to issue a bill by
Carmack’s first sentence.”). The terms of the bill of lading and whether a bill
is issued at all are irrelevant to the applicability of the Carmack Amendment. 5
4 In support of its non-preemption argument, Heniff cites only one unpublished
district court decision, D.M. Best Co. v. Summit Worldwide, LLC, No. CIV. A. H-08-1279,
2009 WL 5061776 (S.D. Tex. Dec. 15, 2009). The D.M. Best court found that a company hired
to load equipment onto trailers for transportation by the carrier did not fall within the scope
of the Carmack Amendment. Id. at *2. That decision, however, appears incorrect in the light
of the plain language of the Amendment, which provides a non-exclusive list of “services” and
also specifically enumerates “arranging for,” “handling,” “packing,” and “unpacking” as
services within the purview of the Amendment. Further, the court relied on Camp v. TNT
Logistics Corp., 553 F.3d 502, 508 (7th Cir. 2009), stating the “Seventh Circuit has held that
a party who loaded the cargo did not provide ‘services related to’ the movement of the goods.”
D.M. Best, 2009 WL 5061776 at *2. That appears to misread the Seventh Circuit’s opinion;
in fact, the Seventh Circuit grounded its decision on the fact that the party in question “was
a third-party logistics company whose main focus was the timely and efficient procurement
of auto parts.” Camp, 553 F.3d at 508. The opinion does not suggest that the logistics
company actually engaged in the labor of loading the cargo.
5Accord Hubbard v. All States Relocation Servs., Inc., 114 F. Supp. 2d 1374, 1381
(S.D. Ga. 2000) (“[A] bill of lading is irrelevant to the applicability of the Carmack
Amendment.”).
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Further, “[l]iability under the Carmack Amendment . . . extends beyond
the carrier who actually provides the transportation. It extends to any carrier
‘providing transportation or service.’” Land O’Lakes, Inc. v. Superior Serv.
Transp of Wis., Inc., 500 F. Supp. 2d 1150, 1155 (E.D. Wis. 2007) (quoting 49
U.S.C. § 14706(a)(1)). Indeed, the Carmack Amendment specifically provides
for an apportionment remedy whereby one carrier may recover from another
carrier “over whose line or route the loss or injury occurred.” 49 U.S.C.
§ 14706(b). 6
Heniff also suggests that because Trimac had no knowledge of the
upcoming shipment and did not know that the particular tanker it was
washing was going to be used to transport chemicals across state lines, it was
not subject to the Carmack Amendment. But the Carmack Amendment does
not have any scienter requirement; all that matters is whether the claims fall
under the “jurisdiction” of the Carmack Amendment, which, as we have stated,
they do here, regardless of whether Trimac knew as much at the time it
provided the wash services. 7
6 Heniff actually brought such a claim under the Carmack Amendment in addition to
its state law claims. In so doing, it specifically alleged that Trimac was a “motor carrier”
under the Carmack Amendment because the statute defines “transportation” to include
“services related to [the] movement of [people or property].” Complaint ¶¶ 30-33. The district
court dismissed the Carmack claim for failure to comply with procedural requirements.
Heniff did not appeal that ruling but appealed only the ruling that the state law claims were
Carmack-preempted. In so appealing, it argues that the Carmack Amendment never applied
at all to this transaction. Although pleading in the alternative may be permissible, the irony
of Heniff’s alternative pleading glitters.
7 Because we hold that Heniff’s claims are preempted based on the plain language of
the statute, we need not consider Trimac’s alternative arguments that (1) Trimac was a
“motor carrier” because it had a properly published tariff with the Surface Transportation
Board and (2) Heniff’s claims were precluded based on holdings reached by the district court
in the case between Hartford (Heniff’s insurer) and Trimac.
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V.
For these reasons, we hold that the tanker wash services that Trimac
provided were “services related to [the] movement [of passengers or property
in interstate commerce],” 49 U.S.C. § 13102(23), and thus Trimac was acting
as a “carrier” subject to the Carmack Amendment. The judgment of the district
court dismissing Heniff’s state law claims as preempted is
AFFIRMED.
10