Global Oil Tools, Inc. v. Expeditors International of Washington, Inc. et al, No. 2:2016cv16372 - Document 113 (E.D. La. 2018)
Court Description: ORDER AND REASONS granting 54 , 88 Motions for Summary Judgment. For the foregoing reasons, the Court GRANTS Hapag-Lloyd's and Ports America's motions for summary judgment. Plaintiff's claims against Hapag-Lloyd and Ports America are DISMISSED WITH PREJUDICE. Expeditors' and Andrea Merzario's crossclaims against Ports America are DISMISSED WITH PREJUDICE. Signed by Judge Sarah S. Vance on 4/2/2018. (cg)
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Global Oil Tools, Inc. v. Expeditors International of Washington, Inc. et al Doc. 113 UNITED STATES DISTRICT COURT EASTERN DISTRICT OF LOUISIANA GLOBAL OIL TOOLS, INC. VERSUS CIVIL ACTION NO. 16-16372 EXPEDITORS INTERNATIONAL OF WASHINGTON, INC. ET AL. SECTION “R” (1) ORD ER AN D REASON S Before the Court are defendant Hapag-Lloyd (Am erica), LLC’s and Ports Am erica Louisiana, L.L.C.’s m otions for sum m ary judgm ent. 1 For the following reasons, the Court grants the m otions. The Him alay a clause in the relevant bill of lading forecloses the liability of Hapag-Lloyd and Ports Am erica to plaintiff. Ports Am erica is further entitled summ ary judgment on two crossclaims against it because it was not negligent. I. BACKGROU N D Plaintiff sells tools for oil and gas exploration. 2 In early 20 16, plaintiff was in negotiations to sell a large num ber of tools, allegedly worth $ 2.4 m illion, as well as intellectual property, to an overseas buyer. 3 1 2 3 In R. Docs. 54, 88. R. Doc. 87-2 at 2. Id. at 2-3; R. Doc. 16 at 9 ¶ 28. Dockets.Justia.com anticipation of the sale, plaintiff packed these tools and intellectual property into two shipping containers, and contracted with defendant Expeditors International of Washington, Inc. (Expeditors) to arrange for the shipm ent of these containers to Rom ania. 4 Expeditors arranged for the containers to sail from New Orleans on March 12, 20 16, aboard a ship operated by HapagLloyd. 5 The containers arrived in New Orleans from Houm a, Louisiana on March 8, 6 but plaintiff (through Expeditors) requested that Hapag-Lloyd delay the trans-Atlantic shipm ent for two weeks. 7 The containers were then scheduled to sail in late March aboard the M/ V BAVARIA. On March 22, plaintiff instructed Expeditors to delay the shipment again. 8 Expeditors relayed this instruction to Hapag-Lloyd, but Hapag-Lloyd failed to relay it to defendant Ports Am erica, the stevedoring com pany responsible for loading containers onto the M/ V BAVARIA. 9 The ship, with plaintiff’s containers on board, sailed on March 28. 10 4 R. Doc. 87-2 at 2-3; R. Doc. 87-3 (shipper’s letter of instructions to Expeditors). 5 R. Doc. 112-7 at 1. 6 R. Doc. 87-2 at 3. 7 R. Doc. 76-1 at 5-6. 8 R. Doc. 87-2 at 4. 9 See R. Doc. 88-2 at 1-2, 10 ; R. Doc. 112-7 at 13-14 (Hapag-Lloyd booking confirm ation reflecting shipment date of April 2). 10 R. Doc. 112-7 at 16-17 (Hapag-Lloyd booking confirm ation reflecting that plaintiff’s containers were loaded in error on the M/ V BAVARIA and sailed on March 28). Hapag-Lloyd discovered the m istake on the sam e day, 2 After the ship sailed, plaintiff acquiesced in the discharge of its containers at Constanta, Rom ania. 11 The containers were transshipped in Cagliari, Italy, and arrived at Constanta on April 23, 20 16. 12 A bill of lading, dated March 28, was approved by plaintiff on May 27. 13 The bill of lading identifies Romarftrans Group Srl. (RGS) as plaintiff’s interm ediate consignee. 14 RGS is Andrea Merzario, S.A.’s agent in Rom ania. 15 Acting through RGS, and pursuant to plaintiff’s instructions, Andrea Merzario m oved the containers to a bonded storage facility in J une 20 16. 16 The sale of plaintiff’s tools and intellectual property was never consum m ated, and the containers rem ain in Constanta. Som e tools were purportedly dam aged during transit. 17 see id., and plaintiff learned of the m istaken shipment shortly thereafter, R. Doc. 87-2 at 5. 11 R. Doc. 87-2 at 8; R. Doc. 82-10 . 12 R. Doc. 112-5. 13 R. Doc. 112-4 (authenticated bill of lading); R. Doc. 112-3 at 13 (em ail in which plaintiff approved bill of lading). Plaintiff contends that the bill of lading is dated Septem ber 28, 20 16. Although the date on the docum ent is somewhat difficult to read, no reasonable juror, exam ining the document closely, would read the date as “0 9/ 28/ 16” rather than “0 3/ 28/ 16.” 14 R. Doc. 112-4 at 2. 15 See R. Doc. 82-11 (letter of attorney authorizing RGS, on behalf of Andrea Merzario, to represent plaintiff’s interests in Rom ania). 16 R. Docs. 82-13, 82-14. 17 R. Doc. 87-2 at 6; R. Doc. 87-7. 3 Plaintiff sued Expeditors and Zurich Am erican Insurance Company, Expeditors’ liability insurer, on Novem ber 15, 20 16, for dam ages and declaratory relief. 18 Plaintiff added Hapag-Lloyd, Ports America, and Andrea Merzario as defendants on March 13, 20 17. 19 Several defendants have filed crossclaim s and counterclaim s. 20 Hapag-Lloyd now m oves for sum m ary judgm ent on plaintiff’s claim s, 21 and Ports Am erica m oves for sum m ary judgm ent on plaintiff’s claim s and Expeditors’ and Andrea Merzario’s crossclaim s. 22 Plaintiff and Expeditors have filed oppositions, 23 but Andrea Merzario has not. II. LEGAL STAN D ARD Sum m ary judgment is warranted when “the m ovant shows that there is no genuine dispute as to any m aterial fact and the m ovant is entitled to judgm ent as a m atter of law.” Fed. R. Civ. P. 56(a); see also Celotex Corp. v. Catrett, 477 U.S. 317, 322-23 (1986); Little v. Liquid Air Corp., 37 F.3d 10 69, 10 75 (5th Cir. 1994). When assessing whether a dispute as to any m aterial 18 R. Doc. 1. R. Doc. 16. Plaintiff also sued, and later voluntarily dism issed, New Orleans Term inal, LLC. See R. Doc. 41. 20 See R. Docs. 26, 33, 50 . 21 R. Doc. 54. 22 R. Doc. 88. 23 R. Docs. 87, 91, 92. 4 19 fact exists, the Court considers “all of the evidence in the record but refrain[s] from m aking credibility determ inations or weighing the evidence.” Delta & Pine Land Co. v. Nationw ide Agribusiness Ins. Co., 530 F.3d 395, 398-99 (5th Cir. 20 0 8). All reasonable inferences are drawn in favor of the nonm oving party, but “unsupported allegations or affidavits setting forth ‘ultim ate or conclusory facts and conclusions of law’ are insufficient to either support or defeat a m otion for sum m ary judgment.” Galindo v. Precision Am . Corp., 754 F.2d 1212, 1216 (5th Cir. 1985); see also Little, 37 F.3d at 10 75. A dispute about a m aterial fact is genuine “if the evidence is such that a reasonable jury could return a verdict for the nonm oving party.” Anderson v. Liberty Lobby , Inc., 477 U.S. 242, 248 (1986). If the dispositive issue is one on which the m oving party will bear the burden of proof at trial, the m oving party “m ust come forward with evidence which would entitle it to a directed verdict if the evidence went uncontroverted at trial.” Int’l Shortstop, Inc. v. Rally ’s, Inc., 939 F.2d 1257, 1264-65 (5th Cir. 1991). The nonm oving party can then defeat the m otion by either countering with evidence sufficient to dem onstrate the existence of a genuine dispute of m aterial fact, or “showing that the m oving party’s evidence is so sheer that it m ay not persuade the reasonable fact-finder to return a verdict in favor of the m oving party.” Id. at 1265. 5 If the dispositive issue is one on which the nonm oving party will bear the burden of proof at trial, the m oving party m ay satisfy its burden by m erely pointing out that the evidence in the record is insufficient with respect to an essential elem ent of the nonm oving party’s claim . See Celotex, 477 U.S. at 325. The burden then shifts to the nonm oving party, who m ust, by subm itting or referring to evidence, set out specific facts showing that a genuine issue exists. See id. at 324. The nonm ovant m ay not rest upon the pleadings, but m ust identify specific facts that establish a genuine issue for trial. See, e.g., id.; Little, 37 F.3d at 10 75 (“Rule 56 m andates the entry of sum m ary judgment, after adequate tim e for discovery and upon m otion, against a party who fails to m ake a showing sufficient to establish the existence of an elem ent essential to that party’s case, and on which that party will bear the burden of proof at trial.” (quoting Celotex, 477 U.S. at 322)). III. D ISCU SSION A. Th e Bill o f Lad in g Bars Plain tiff’s Claim s Again s t H apag-Llo yd an d Po rts Am e rica Hapag-Lloyd and Ports Am erica seek sum m ary judgment on plaintiff’s claim s against them based on the Him alay a clause in the bill of lading. A bill of lading is a contract between a shipper and a carrier for transportation of goods. See N orfolk S. Ry . Co. v. Kirby , 543 U.S. 14, 18-19 (20 0 4) (“A bill 6 of lading records that a carrier has received goods from the party that wishes to ship them , states the terms of carriage, and serves as evidence of the contract for carriage.”). The contract “enunciates the responsibility of the carrier to deliver enum erated goods to a specified location.”24 Interocean S.S. Corp. v. N ew Orleans Cold Storage & W arehouse Co., 865 F.2d 699, 70 3 (5th Cir. 1989). As contracts of adhesion, bills of lading are “strictly construed against the carrier.” Id. (quoting Allied Chem . v. Com panhia de N avegacao, 775 F.2d 476, 482 (2d Cir. 1985)). But “contracts for carriage of goods by sea m ust be construed like any other contracts: by their terms and consistent with the intent of the parties.” Kirby , 543 U.S. at 397. Here, Expeditors issued the bill of lading for plaintiff’s containers, although Expeditors did not actually own or operate the ship that transported the containers. In this transaction, Expeditors acted as a nonvessel operating com m on carrier—a type of intermediary between the shipper (plaintiff) and the vessel-operating com m on carrier (Hapag-Lloyd). See GIC Servs., L.L.C. v. Freightplus USA, Inc., 866 F.3d 649, 657 (5th Cir. 24 A nonnegotiable bill of lading directs the carrier to deliver the goods to a specific person, called a consignee. See 1 Thom as Schoenbaum, Adm iralty and Maritim e Law § 10 -11 (5th ed. 20 17)). A negotiable bill, on the other hand, “functions as a docum ent of title” and directs the carrier to deliver the goods to the holder of the bill. Id. (em phasis om itted). Expeditors’ bill of lading in this case states that it is nonnegotiable. R. Doc. 112-4 at 2. 7 20 17). With respect to plaintiff, Expeditors played the role of carrier; with respect to Hapag-Lloyd, however, Expeditors played the role of shipper. See 1 Adm iralty and Maritim e Law § 10 -7. In its capacity as carrier, Expeditors owed a num ber of statutory duties to plaintiff under the Carriage of Goods by Sea Act (COGSA). Most im portantly, COGSA requires the carrier to “properly and carefully load, handle, stow, carry, keep, care for, and discharge the goods carried.” 46 U.S.C. § 30 70 1 note sec. 3(2). In other words, and subject to several exceptions, Expeditors was “liable to [plaintiff] if ‘anything happen[ed] to the cargo during the voyage.’” GIC Servs., 866 F.3d at 657 (quoting Prim a U.S. Inc. v. Panalpina, Inc., 223 F.3d 126, 129 (2d Cir. 20 0 0 )). The bill of lading issued by Expeditors incorporates the provisions of COGSA. 25 See 46 U.S.C. § 30 70 1 note sec. 13. The bill of lading also includes a Him alay a clause, which reads: Merchant undertakes that no claim or allegation shall be m ade against any Person or Vessel whatsoever other than Carrier, including the Carrier’s servants or agents, any independent contractors (at any tim e) and their servants or agents, Participating Carriers, and all others by whom the whole or any 25 R. Doc. 88-2 at 18. This clause is known as the clause param ount. See Brow n & Root, Inc. v. M/ V Peisander, 648 F.2d 415, 420 (5th Cir. 1981). Although COGSA applies of its own force only “from the tim e when the goods are loaded on to the tim e when they are discharged from the ship,” 46 U.S.C. § 30 70 1 note sec. 1(e), the clause param ount provides that “COGSA shall govern before loading” as well. R. Doc. 88 -2 at 18. 8 part of the Carriage, whether directly or indirectly, is procured, perform ed, or undertaken, which im poses or attem pts to im pose upon any such Person or Vessel any liability whatsoever in connection with the Good or the Carriage . . . . 26 In other words, plaintiff covenanted not to sue any party involved in the transportation of its shipping containers, except Expeditors. Thus, under the plain language of the bill of lading, plaintiff relinquished any right to sue Hapag-Lloyd or Ports Am erica. Plaintiff offers several argum ents to resist the application of the Him alay a clause. First, plaintiff argues that the Him alay a clause does not apply because the bill of lading was not issued until after the erroneous shipment. 27 Relatedly, plaintiff argues that the bill of lading fails for lack of consideration because it was executed after shipment. 28 But courts routinely enforce bills of lading issued after goods are damaged during carriage. See, e.g., Uncle Ben’s Int’l Div. of Uncle Ben’s, Inc. v. Hapag-Lloy d Aktiengesellschaft, 855 F.2d 215, 217 (5th Cir. 1988) (rejecting argument that because “the bills of lading were issued after the containerization, they 26 R. Doc. 88-2 at 30 . The clause further extends “all exem ptions, lim itations of, and exonerations from liability provided by Law or by” the bill of lading “to all agents, servants, employees, representatives, Participating Carriers (including road, rail, water and air carriers), [and] stevedores.” Id. Such lim itations of liability include those provided by COGSA. 27 R. Doc. 87 at 17-18. 28 Id. at 20 . 9 cannot apply to the claim s in question”); Luckenbach S.S. Co. v. Am . Mills Co., 24 F.2d 70 4, 70 5 (5th Cir. 1928). In Luckenbach, for exam ple, a fire destroyed a number of cots during loading. The bill of lading, which was “in accordance with its standard form ,” exem pted the carrier from liability for dam ages because of fire. Luckenbach, 24 F.2d at 70 5. The shipper argued that this exem ption did not apply because the bill of lading was not issued until after the fire. But the Fifth Circuit enforced the bill of lading, holding that the bill “evidenced the contract the parties entered into at the tim e the goods were delivered and accepted.” Id. At that tim e, “an im plied understanding arose from com m on business experience that the carrier would issue such bill of lading as it was its custom to issue to shippers in the usual course of its business.” Id. Here, as in Luckenbach, the standard bill of lading reflected the contract of carriage that the shipper and carrier entered into when the goods were delivered to the carrier. The bill of lading is not unenforceable m erely because it was issued after the erroneous shipment. Second, plaintiff argues that the bill of lading is unenforceable because plaintiff never signed or approved it. 29 But a bill of lading need not be signed by a shipper to be enforceable, so long as the shipper had notice of the bill of 29 Id. 10 lading’s terms. See, e.g., Am . Ry . Express Co. v. Lindenburg, 260 U.S. 584, 590 -91 (1923); Roy al Air, Inc. v. AAA Cooper Transp., Inc., 395 F. Supp. 2d 436, 440 (W.D. La. 20 0 5); Vesta Forsikring AS v. Mediterranean Shipping Co., SA, No. 0 0 -1938, 20 0 1 WL 1660 255, at *4-5 (S.D. Tex. Aug. 10 , 20 0 1). The record indicates that plaintiff had notice of the bill of lading’s terms and explicitly approved the bill of lading by em ail on May 27, 20 16. 30 Third, plaintiff argues that the covenant not to sue in the Him alay a clause is unenforceable because it violates public policy. 31 Specifically, plaintiff points to 46 U.S.C. § 30 70 4, which provides: “A carrier m ay not insert in a bill of lading . . . a provision avoiding its liability for loss or damage arising from negligence or fault in loading, stowage, custody, care, or proper delivery. Any such provision is void.” Plaintiff argues that the covenant not to sue Hapag-Lloyd violates this provision because Hapag-Lloyd is a carrier within the m eaning of 46 U.S.C. § 30 70 4. Plaintiff also suggests that HapagLloyd violated COGSA by not issuing a bill of lading itself. Hapag-Lloyd did issue a bill of lading, which properly designated Expeditors as the shipper. 32 See 1 Adm iralty and Maritim e Law § 10 -7 30 31 32 R. Doc. 112-3 at 13. R. Doc. 92 at 6. R. Doc. 112-6. 11 (“With respect to the vessel and her owner, the [non-vessel operating com m on carrier] is a shipper or customer.”). But Hapag-Lloyd does not rely on this bill of lading in its sum m ary judgm ent m otion. Instead, Hapag-Lloyd relies on the Him alay a clause in Expeditors’ bill of lading. At least two circuit courts, as well as one section of this Court, have enforced Him alay a clauses that include covenants not to sue subcontractors. 33 See Som po Japan Ins. Co. v. N orfolk S. Ry . Co., 762 F.3d 165 (2d Cir. 20 14); Fed. Ins. Co. v. Union Pac. R.R. Co., 651 F.3d 1175 (9th Cir. 20 11); Roy al SMIT Transform ers BV v. HC Bea-Luna M/ V, No. 1614647, 20 17 WL 2364362 (E.D. La. May 31, 20 17). The Ninth Circuit regarded such a covenant not to sue as “an enforcem ent m echanism rather than a reduction of ‘the carrier’s obligations to the cargo owner below what COGSA guarantees.’” Fed. Ins., 651 F.3d at 1180 (quoting Firem an’s Fund Ins. Co. v. M/ V DSR Atl., 131 F.3d 1336, 1339 (9th Cir. 1997)); see also id. at 1179-80 (“The Supreme Court has distinguished between im perm issible 33 While neither the Fifth Circuit nor the Suprem e Court has addressed a covenant not to sue in a Him alay a clause, the Supreme Court in Kirby enforced a classic Him alay a clause, which extends a carrier’s lim itation of liability under COGSA to the carrier’s subcontractors. The Court held that “[t]he plain language of the Himalaya Clause indicates an intent to extend the liability lim itation broadly,” and found “no reason to contravene the clause’s obvious meaning.” 543 U.S. at 31-32. 12 contracts that reduce the carrier’s obligations and enforceable contracts that affect only the ‘m echanisms’ of enforcing a shipper’s rights.” (citing Vim ar Seguros y Reaseguros, S.A. v. M/ V Sky Reefer, 515 U.S. 528, 535 (1995)). Likewise, the Second Circuit treated a covenant not to sue as “sim ply an ordering mechanism .” Som po, 762 F.3d at 182. Because the bill of lading preserved the shipper’s right to sue the carrier and the carrier’s right to sue the allegedly negligent subcontractor, the Second Circuit held that the covenant not to sue did not violate public policy. Id. at 183. The Court finds this reasoning persuasive, and holds that the covenant not to sue contained in the Him alay a clause is enforceable. Finally, plaintiff argues that the Him alay a clause does not apply because Ports America and Hapag-Lloyd acted without authority, and outside any contractual relationship, when they erroneously loaded plaintiff’s containers. 34 But the covenant not to sue covers any party “by whom . . . any part of the Carriage . . . is . . . perform ed.” Hapag-Lloyd and Ports Am erica clearly perform ed part of the carriage as contem plated by the bill of lading, which the Court has already deemed enforceable. Accordingly, the Him alay a clause bars plaintiff’s claim s against Hapag-Lloyd and Ports 34 R. Doc. 87 at 21; R. Doc. 92 at 4. 13 Am erica. Hapag-Lloyd and Ports Am erica are entitled sum m ary judgment on plaintiff’s claim s against them . B. Th e re Is N o Evid e n ce o f Po rts Am e rica’s N e glige n ce Ports Am erica further seeks sum m ary judgm ent on plaintiff’s claim s, and Expeditors’ and Andrea Merzario’s crossclaim s, on the ground that there is no evidence of wrongdoing by Ports Am erica. 35 Specifically, Ports America asserts that it properly loaded plaintiff’s containers as instructed by HapagLloyd and did not dam age the containers. Plaintiff’s claim s against Ports Am erica sound in negligence. 36 “To establish m aritime negligence, a plaintiff m ust ‘dem onstrate that there was a duty owed by the defendant to the plaintiff, breach of that duty, injury sustained by [the] plaintiff, and a causal connection between the defendant’s conduct and the plaintiff’s injury.’” Canal Barge Co. v. Torco Oil Co., 220 F.3d 370 , 376 (5th Cir. 20 0 0 ) (quoting In re Cooper/ T. Sm ith, 929 F.2d 10 73, 35 R. Doc. 88 at 4-8. Expeditors and Andrea Merzario assert crossclaims of breach of contract, breach of warranty or duty, willful or intentional conduct, and conversion, in addition to negligence and gross negligence, against Ports Am erica and other defendants. R. Doc. 26 at 13 ¶ 15; R. Doc. 50 at 3 ¶ 9. But there is no support, either in the pleadings or in the record, for any claim against Ports America other than negligence. Moreover, neither Expeditors nor Andrea Merzario presents any basis for Ports America’s liability in response to Ports Am erica’s summary judgment m otion. The Court therefore confines its analysis to the negligence claim against Ports Am erica. 14 36 10 77 (5th Cir. 1991)). Plaintiff asserts that Ports Am erica breached its duty to inspect plaintiff’s containers; to inform Hapag-Lloyd of the condition in which the containers were loaded; and to determ ine whether loading was proper, whether there was proper docum entation, and whether the containers and goods had been inspected and insured. 37 A stevedore m ust “use reasonable care and ordinary diligence in the loading and stowage of cargo.” Falcon Constr. Co. v. Bacon Tow ing Co., 613 F. Supp. 221, 223 (S.D. Tex. 1985). This duty m ay include alerting the vessel of any known risk to the cargo. See, e.g., F.J. W alker Ltd. v. Motor Vessel Lem oncore, 561 F.2d 1138, 1148 (5th Cir. 1977) (noting that a stevedore “m ust at least inform the vessel of a serious hazard being created” as a result of unloading cargo). But the parties point to no authority for the proposition that a stevedore has a duty to inspect shipping containers that it did not pack, or to ensure that the containers are properly inspected, insured, and docum ented. Nor is there any evidence suggesting that Ports Am erica had any reason to believe that the containers had been im properly packed. 38 Moreover, Ports Am erica was entitled to follow the loading instructions of Hapag-Lloyd. Ports America had no contractual relationship 37 R. Doc. 92 at 2-3. See R. Doc. 88-2 at 1 (declaration by Ports Am erica em ployee stating that Ports Am erica did not pack plaintiff’s containers). 15 38 with either Expeditors or plaintiff, and it relied solely on Hapag-Lloyd’s loading instructions. 39 There is no evidence suggesting that Ports Am erica had any reason to believe that it should not load the containers onto the M/ V BAVARIA. Accordingly, Ports Am erica is entitled sum mary judgm ent on plaintiff’s claim s, and Expeditors’ and Andrea Merzario’s crossclaims, against it. IV. CON CLU SION For the foregoing reasons, the Court GRANTS Hapag-Lloyd’s and Ports Am erica’s m otions for sum m ary judgment. Plaintiff’s claim s against HapagLloyd and Ports Am erica are DISMISSED WITH PREJ UDICE. Expeditors’ and Andrea Merzario’s crossclaim s against Ports America are DISMISSED WITH PREJ UDICE. New Orleans, Louisiana, this _2nd_ _ day of April, 20 18. __ _____________________ SARAH S. VANCE UNITED STATES DISTRICT J UDGE 39 Id. at 1-2. 16
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