United States District Court, S.D. Texas, Houston Division
OPINION ON SUMMARY JUDGMENT
N. HUGHES UNITED STATES DISTRICT JUDGE.
Energy, LP, bought equipment from Toshiba International
Corporation in 2012, including two 3, 500 horsepower variable
frequency drives used to control motor speed and torque
applied in natural gas compression for pipelines. Under the
contract between Enbridge and Toshiba, Toshiba was obliged to
ship the drives and equipment to an Enbridge warehouse in
had contracted with C.H. Robinson in 2011 for Robinson to be
its freight broker. Under this agreement, Toshiba engaged
Robinson to hire a trucking company to haul the drives.
Robinson retained Imperial Freight Inc. to retrieve the cargo
from Toshiba in Houston, load it, and carry it to Michigan.
While en route to Michigan, Imperial Freight's driver
left the highway so fast that the truck overturned on the
off-ramp in Arkansas. The driver was cited for careless and
prohibited driving and the drives were damaged beyond
economic repair. The total value of the drives at that time
was $ 643, 981.80. It cost Enbridge $31, 965.36 to tow it to
a storage facility and store it until it could be delivered
to the warehouse in Michigan, so Enbridge lost $675, 947.16.
timely filed a loss and damage claim form with Robinson on
October 17, 2013. Robinson acknowledged receipt of the claim
four days later and advised that it would begin the claims
process with the carrier and its insurer. In December 2013,
Imperial Freight's insurer denied coverage for
Enbridge's claim because the policy did not cover the
drives. Enbridge then filed this lawsuit.
Liability Under 49 U.S.C. §
can only be liable to Enbridge under the Carmack Amendment if
it is a motor carrier - rather than an independent broker.
The Carmack Amendment does not govern the role of brokers
with respect to interstate cargo losses and
damages A broker is not liable for the negligence
of its independent contractor trucking company or the driver
hired and supervised by that company.
a motor carrier, Robinson does not own or operate trucks or
employ drivers. Instead, Robinson connects companies who need
to ship goods with other, unrelated trucking companies
qualified to haul those goods as independent contractors.
That is the function of a broker.
located an independent motor carrier - Imperial Freight - and
negotiated with it for the shipper. The only direction it
gave to Imperial Freight was general instructions on the
load, including its origin and destination. Further, the
express terms of Robinson's contract with Imperial
Freight made Imperial Freight a contractor separate and apart
from Robinson as the broker that arranged for the shipment.
fits squarely within the definition of a
broker. It was not a motor carrier. Accordingly,
it is not liable to Enbridge under 49 U.S.C. § 14706.
Federal Aviation Administration Authorization Act preempts
state regulation of the trucking industry, including
state-law private claims. It precludes states from
"enact[ing] or enforc[ing] a law, regulation, or other
provision having the force and effect of law related to a
price, route, or service of any motor carrier [or]
broker... with respect to the transportation of
property." The FAAAA preempts common4aw negligent
hiring claims against freight brokers. The claim that a
broker failed to verify adequate insurance coverage of cargo
also falls within the FAAAA and is, therefore, preempted by
FAAAA preempts Enbridge's state law claims against
Robinson. As discussed below, even if they were not
preempted, they would still fail.