BAD COMPANY INC., Plaintiff, v. EXPEDITORS INTERNATIONAL OF WASHINGTON, INC

United States District Court,

E.D. Virginia.

BAD COMPANY INC., Plaintiff,

EXPEDITORS INTERNATIONAL OF WASHINGTON, INC., Defendant.

Civil Action No: 4:17cv1

Filed 05/04/2017

MEMORANDUM ORDER

Mark S. Davis UNITED STATES DISTRICT JUDGE

This matter is before the Court on a motion for a more definite statement filed by Defendant Expeditors International of Washington, Inc. (“Defendant” or “Expeditors”), ECF No. 4, and a motion to remand filed by Plaintiff Bad Company Inc. (“Plaintiff” or “Bad Company”), ECF No. 10. For the reasons set forth below, the Court GRANTS Defendant’s motion for a more definite statement, and TAKES UNDER ADVISEMENT Plaintiff’s motion to remand.

FACTUAL AND PROCEDURAL BACKGROUND1

With its principle place of business in Toano, Virginia, Plaintiff is a family-owned business that performs high-end automobile customization and high-performance automobile parts installation. Pl.’s Remand Opening Br. 2, ECF No. 11. On or about January 22, 2015, Plaintiff contracted with Defendant to ship two Toyota Supra automobile engines from Sayreville, New Jersey, to Houston, Texas. Id. Collectively valued at $39,904.30, the engines were picked up by Defendant and/or its agent(s) but were never delivered to Plaintiff. Id. According to Plaintiff, the engines have not been recovered, and Defendant has refused to reimburse Plaintiff for their value. Id.

On February 10, 2016, Plaintiff filed a complaint in the Williamsburg / James City County Circuit, alleging breach of contract and unjust enrichment claims due to Defendant’s alleged failure to deliver the engines. Notice of Removal ¶ 1, ECF No. 1. Plaintiff demanded compensatory damages of $39,904.30. Def.’s Ex. 1, Compl. ¶ 28, Bad Co. Inc. v. Expeditors Int’l of Wash., Inc., CL16000267-00 (Va. Cir. Ct. Feb. 4, 2016). Defendant removed the circuit court case to this Court, asserting that Plaintiff’s claims were removable pursuant to 28 U.S.C. §§ 1331, 1337, and 1445(b), because the claims were preempted by the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. § 14706 (“the Carmack Amendment”), and the amount in controversy exceeded $10,000, providing federal subject matter jurisdiction. Notice of Removal ¶¶ 4-5. Defendant then filed a motion to dismiss under Federal Rule of Civil Procedure 12(b)(6). Id. ¶ 6. Plaintiff did not respond to Defendant’s motion to dismiss, but instead filed a notice of voluntary dismissal without prejudice under Federal Rule of Civil Procedure 41(a) on March 22, 2016. Id. ¶ 7; Notice of Voluntary Dismissal, Bad Co. Inc. v. Expeditors Int’1 of Wash., Inc., No. 4:16-cv-10 (E.D. Va. Mar. 22, 2016).

On November 10, 20162, Plaintiff filed a Warrant in Debt in the Williamsburg / James City County General District Court, demanding $9,900 in damages and $54 in costs on the basis of “Contract and Unjust Enrichment” claims. Pl.’s Remand Opening Br. 2-3; Def.’s Ex. 2, Warrant in Debt, ECF No. 1-2, at 6. No other facts were pled in the Warrant in Debt. Id. Defendant subsequently filed a notice of removal with this Court on January 5, 2017, asserting that the Warrant in Debt was subject to removal on the same basis as Plaintiff’s previous circuit court claims. Notice of Removal ¶ 10. Defendant then filed a motion for a more definite statement under Federal Rule of Civil Procedure 12(e), arguing that Plaintiff’s Warrant in Debt failed to meet the pleading standard of Federal Rule of Civil Procedure 8(a), which requires that a pleading contain “a short and plain statement of the claim showing that the pleader is entitled to relief.” Fed. R. Civ. P. 8(a)(2); Def.’s Rule 12(e) Opening Br. 1-2, ECF No. 5.

Plaintiff opposed Defendant’s motion for a more definite statement, ECF No. 6, at 1-3, and on February 10, 2017, moved to remand the case, ECF No. 10, arguing that this Court does not have subject matter jurisdiction under the Carmack Amendment because the amount in controversy is less than $10,000, ECF No. 11, at 4. Plaintiff requested costs and expenses, including attorney’s fees, incurred as a result of Defendant’s improper attempt to remove this action. Id. Defendant filed a reply brief in support of its motion for a more definite statement on January 27, 2017, ECF No. 8, and filed a response brief opposing Plaintiff’s motion to remand on February 24, 2017, ECF No. 12. Plaintiff did not file a reply brief regarding its motion to remand. Pursuant to Local Civil Rule 7(J), the parties requested rulings on both motions without oral argument. ECF Nos. 9, 13; E.D. Va. Loc. Civ. R. 7(J) (Apr. 1, 2017). Having been fully briefed, Defendant’s motion for a more definite statement and Plaintiff’s motion to remand are ripe for review.

LEGAL STANDARD
Removal

Section 1441 of Title 28, United States Code, provides that:

[A]ny civil action brought in a State court of which the district courts of the United States have original jurisdiction, may be removed by the defendant or the defendants to the district court of the United States for the district and division embracing the place where such action is pending.

28 U.S.C. § 1441(a). A defendant is permitted to remove a state court action to federal court only if the plaintiff could have originally filed such action in federal court. Caterpillar Inc. v. Williams, 482 U.S. 386, 392 (1987) (citing 28 U.S.C. § 1441). Removal implicates “significant federalism concerns” and, accordingly, district courts are required to construe the removal statute strictly against removal. Md. Stadium Auth. v. Ellerbe Becket Inc., 407 F.3d 255, 260 (4th Cir. 2005) (quoting Mulcahey v. Columbia Organic Chems. Co., 29 F.3d 148, 151 (4th Cir. 1994)). As the party seeking removal, Defendant bears the burden of establishing federal jurisdiction. Ellenburg v. Spartan Motors Chassis, Inc., 519 F.3d 192, 200 (4th Cir. 2008) (quoting In re Blackwater Sec. Consulting, LLC, 460 F.3d 576, 583 (4th Cir. 2006)). This burden “is no greater than [that] required to establish federal question jurisdiction as alleged in a [federal court] complaint.” Id. However, remand is required if jurisdiction is doubtful. See Mulcahey, 29 F.3d at 151.

Subject Matter Jurisdiction

As courts of limited subject matter jurisdiction, federal district courts may exercise “only the jurisdiction authorized them by the United States Constitution and by federal statute.” United States ex rel. Vuyyuru v. Jadhav, 555 F.3d 337, 347 (4th Cir. 2009) (citing Bowles v. Russell, 551 U.S. 205, 212 (2007)). The Court must “presume … that a case lies outside its limited jurisdiction unless and until jurisdiction has been shown to be proper.” United States v. Poole, 531 F.3d 263, 274 (4th Cir. 2008) (citing Kokkonen v. Guardian Life Ins. Co. of Am., 511 U.S. 375, 377 (1994)) (emphasis in original); Steel Co. v. Citizens for a Better Env’t, 523 U.S. 83, 94–95 (1998)(“The requirement that jurisdiction be established as a threshold matter ‘spring[s] from the nature and limits of the judicial power of the United States’ and is ‘inflexible and without exception.’ ” (quoting Manfield, C. & L.M.R. Co. v. Swan, 111 U.S. 379, 382 (1884))).

Federal district courts possess subject matter jurisdiction over “all civil actions arising under the Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331. “To determine whether the claim arises under federal law, [the court] examine[s] the ‘well pleaded’ allegations of the complaint.” Beneficial Nat. Bank v. Anderson, 539 U.S. 1, 6 (2003); Holmes Group, Inc. v. Vornado Air Circulation Sys., Inc., 535 U.S. 826, 830 (2002) (“The well-pleaded-complaint rule has long governed whether a case ‘arises under’ federal law for purposes of § 1331.”). The well-pleaded complaint rule “provides that federal question jurisdiction exists only when a federal question is presented on the face of the plaintiff’s properly pleaded complaint.” Venezuela v. Massimo Zanetti Beverage USA, Inc., 525 F. Supp. 2d 781, 784 (E.D. Va. 2007) (citing Gully v. First Nat’l Bank, 299 U.S. 109, 112–113 (1936)). Under the well-pleaded-complaint rule, in order for a federal question to be present “either federal law must create the cause of action, or plaintiff’s right to relief must necessarily depend on the resolution of a substantial question of federal law.” Id. at 784–85 (citing Franchise Tax Bd. v. Constr. Laborers Vacation Trust, 463 U.S. 1, 27–28 (1983)).

A defense, including “the pre-emptive effect of a federal statute[,] … will not provide a basis for removal,” absent an exception to the contrary. Beneficial Nat. Bank, 539 U.S. at 6 (citing Franchise Tax Bd., 463 U.S. at 1). Thus, when a plaintiff pleads solely state law claims, a defendant may only remove the action to federal court in “two circumstances–when Congress expressly so provides, … or when a federal statute wholly displaces the state-law cause of action through complete pre-emption.” Id. at 8. Consequently, “[w]hen [a] federal statute completely pre-empts the state-law cause of action, a claim which comes within the scope of that cause of action, even if pleaded in terms of state law, is in reality based on federal law,” making the claim removable to federal court because it is a claim that “arises under” federal law. Id. Thus, while a plaintiff “is the master of his claim,” in order to avoid federal jurisdiction, a plaintiff must rely “exclusively on [un-preempted] state law.” Venezuela, 525 F. Supp. 2d at 785.

Carmack Amendment

The Carmack Amendment completely preempts any state law claims for “liability for goods damaged or lost during interstate shipment under a valid bill of lading.” 5K Logistics, Inc. v. Daily Exp., Inc., 659 F.3d 331, 335 (4th Cir. 2011). “Initially enacted in 1906 as an amendment to the Interstate Commerce Act of 1887, the Carmack Amendment creates ‘a national scheme of carrier liability for goods damaged or lost during interstate shipment under a valid bill of lading.’ ” Id. (quoting Shao v. Link Cargo (Taiwan) Ltd., 986 F.2d 700, 704 (4th Cir. 1993)). The Carmack Amendment “makes a carrier liable ‘for the actual loss or injury to the property’ it transports.” Ward v. Allied Van Lines, Inc., 231 F.3d 135, 138 (4th Cir. 2000) (quoting 49 U.S.C. § 14706(a)(1)(1997)). As a “comprehensive exercise of Congress’s power to regulate interstate commerce[,] … [the Carmack Amendment] has long been interpreted to preempt state liability rules pertaining to cargo carriage.” 5K Logistics, 659 F.3d at 335 (“Almost every detail of the subject is covered so completely [by the Carmack Amendment] that there can be no rational doubt but that Congress intended to take possession of the subject, and supersede all state regulation with reference to it.” (quoting Adams Express Co. v. Croninger, 226 U.S. 491, 505–06 (1913))). Due to complete preemption, federal law provides the basis for any claims for “liability for goods damaged or lost during interstate shipment under a valid bill of lading.” 5K Logistics, 659 F.3d at 335.

While federal law provides the basis for the claim, a civil action under the Carmack Amendment “against the carrier alleged to have caused the loss or damage” may be brought in either a federal district court or in a state court. 49 U.S.C. § 14706(d). However, a federal district court has original jurisdiction over claims arising under the Carmark Amendment “only if the matter in controversy for each receipt or bill of lading exceeds $10,000, exclusive of interest and costs.” 28 U.S.C. § 1337 (emphasis added). Thus, because state courts have exclusive jurisdiction of claims arising under the Carmack Amendment when the amount in controversy is less than $10,000, a case may be removed from state court to a federal district court only when “the matter in controversy exceeds $10,000, exclusive of interest and costs.” 28 U.S.C. § 1445(b).

More Definite Statement

Pursuant to Federal Rule of Civil Procedure 8(a), “[a] pleading that states a claim for relief must contain: (1) a short and plain statement of the grounds for the court’s jurisdiction, … (2) a short and plain statement of the claim showing that the pleader is entitled to relief; and(3) a demand for the relief sought.” Fed. R. Civ. P. 8(a). A complaint fails to state a claim if it does not allege “enough facts to state a claim to relief that is plausible on its face.” Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007). Though a complaint need not be detailed, the “[f]actual allegations must be enough to raise a right to relief above the speculative level.” Id. at 555; see Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009). In other words, “[a] claim has facial plausibility when the plaintiff pleads factual content that allows the court to draw the reasonable inference that the defendant is liable for the misconduct alleged.” Iqbal, 556 U.S. at 663.

Under Federal Rule of Civil Procedure 12(e), a party may move for “a more definite statement” when the pleading is “so vague or ambiguous that the party cannot reasonably prepare a response.” Fed. R. Civ. P. 12(e). “Due to th[e] liberal notice-pleading standard and the availability of extensive discovery, the motion for more definite statement is not favored.” Frederick v. Koziol, 727 F. Supp. 1019, 1020 (E.D. Va. 1990). “A motion for more definite statement will only be granted if the complaint is so vague and ambiguous that the defendant cannot frame a responsive pleading.” Flaum v. Gloucester Lanes, Inc., 299 F.R.D. 120, 122 (E.D. Va. 2014) (finding that a more definite statement was necessary for plaintiff to establish standing to bring his claims); cf. Hodgson v. Virginia Baptist Hosp., Inc., 482 F.2d 821, 823–24 (4th Cir. 1973) (holding that when a complaint stated the jurisdictional grounds for the claim, identified the legal basis for the alleged claim, described the nature of the violation, specified the period of time in which the violation occurred, and provided notice of the relief requested, a more definite statement was not necessary); Frederick, 727 F. Supp. at 1021 (denying a motion for more definite statement when the complaint gave “the defendants fair notice of the claims against them”). Finally, “[i]f the court orders a more definite statement and the order is not obeyed within 14 days after notice of the order or within the time the court sets, the court may strike the pleading or issue any other appropriate order.” Fed. R. Civ. P. 12(e).

III. DISCUSSION

Defendant argues that this Court has original subject matter jurisdiction over this case because Plaintiff’s “Contract and Unjust Enrichment” claims for the two engines lost during interstate shipment are preempted by the Carmack Amendment and the amount in controversy exceeds $10,000. Notice of Removal ¶¶ 10-18. Plaintiff argues that the amount in controversy is less than $10,000, and therefore this Court does not have jurisdiction. Pl.’s Remand Opening Br. 4. Next, Defendant argues that Plaintiff’s claim fails to meet the pleading standard of Rule 8(a), and therefore Plaintiff should be required to provide a more definite statement explaining the basis of Plaintiff’s legal claim. Def.’s Rule 12(e) Opening Br. 1-2. According to Defendant, it is “unable to answer” Plaintiff’s claim because there are no factual assertions alleged in the Warrant in Debt. Id. at 1. Plaintiff argues that Defendant is aware of the facts underlying the case, and moreover, because the case should properly be remanded, a more definite statement is unnecessary. Pl.’s Remand Resp. Br. 1-3.

Plaintiff’s Warrant in Debt does not plead sufficient details to give “fair notice” of Plaintiff’s claims. Frederick, 727 F. Supp. at 1021 (noting that a more definite statement was unnecessary when the complaint gave “the defendants fair notice of the claims against them”). In the Warrant in Debt filed in General District Court, Plaintiff claimed $9,900 in damages and $54 in costs, listing the basis of the claim as “Contract and Unjust Enrichment.” Warrant in Debt. Plaintiff did not plead any other facts or law in the Warrant in Debt and did not in any way indicate the legal or factual basis for the contract and unjust enrichment claims against Defendant. Defendant makes the plausible assumption, but assumption nonetheless, that Plaintiff’s Warrant in Debt claims are factually and legally similar to Plaintiff’s previous claims against Defendant in circuit court. Based upon this assumption, in Defendant’s Notice of Removal, Defendant asserts that Plaintiff’s state law claims are preempted by the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. § 14706, and states that this Court has original jurisdiction because the amount in controversy exceeds $10,000. Notice of Removal ¶¶ 11-18. While it is clear that federal law provides the basis for any claim for “liability for goods damaged or lost during interstate shipment under a valid bill of lading” due to complete preemption by the Carmack Amendment, 5K Logistics, 659 F.3d at 335, in stating only the amount of damages demanded and the legal cause of action, Plaintiff’s Warrant in Debt does not make clear that Plaintiff’s claims are for goods damaged or lost during shipment.

Moreover, even if the Carmack Amendment applies and thus preempts Plaintiff’s state law claims, Plaintiff’s Warrant in Debt only demands damages of $9,900, which is less than the threshold amount for this Court to have original jurisdiction over this type of claim. 28 U.S.C. § 1445(b) (requiring that the amount in controversy exceed $10,000 in order for a federal district court to have subject matter jurisdiction over a claim removed under the Carmack Amendment); see Manguno v. Prudential Prop. & Cas. Ins. Co., 276 F.3d 720, 723 (5th Cir. 2002) (“We ordinarily consult the state court petition to determine the amount in controversy.”). Defendant argues that the actual amount in controversy is the $39,904.30 that Plaintiff requested in compensatory damages in the circuit court case. Notice of Removal ¶ 17. In support of Defendant’s removal notice, Defendant submitted as exhibits both the Bill of Lading and the Contract of Carriage from the previous circuit court case. Even assuming that both of these documents are the relevant documents to Plaintiff’s Warrant in Debt claims, both documents fail to list the value of the goods shipped. Additionally, no receipt for the shipment has been provided by either party. Thus, Defendant’s exclusive basis for federal subject matter jurisdiction is the assumption that the amount in controversy is over $10,000 because Plaintiff previously demanded $39,904.30 in compensatory damages based upon presumably the same facts and a similar legal argument. While the Court may exercise “common sense” in evaluating the amount in controversy, Mullins v. Harry’s Mobile Homes, Inc., 861 F. Supp. 22, 24 (S.D.W. Va. 1994), the Court declines to find jurisdiction solely upon an assumption that facts from a different case are presumably similar to the case currently before the Court.3

Plaintiff disputes that this Court has jurisdiction, arguing that the amount in controversy does not exceed $10, 000. Pl.’s Remand Opening Br. 4. Plaintiff states that it is willing to stipulate that its damages are $9,900 and that it will not seek to later amend its ad damnum clause in excess of that amount. Id. at 6. However, while Plaintiff repeatedly indicates a willingness to stipulate to the damage amount, Plaintiff has not yet filed an affidavit with the Court stipulating to the damages amount. Compare Donelow v. Kmart Corp., No. CIV.A. 2:11-00549, 2011 WL 6936359, at *3 (S.D.W. Va. Dec. 29, 2011) (holding that remand was proper when plaintiff stipulated that she sought less than the amount in controversy necessary for federal jurisdiction), with Schwenk v. Cobra Mfg. Co., 322 F. Supp. 2d 676, 679 (E.D. Va. 2004) (finding that the amount in controversy was higher than the amount that plaintiff pleaded in his complaint because plaintiff’s counsel admitted that he intended to amend the ad damnum clause at a future date and refused to stipulate that the amount in controversy did not exceed the jurisdictional amount). Just as the Court declines to find that it has jurisdiction based upon the assumption proffered by Defendant, the Court likewise declines to base a decision to remand upon a stipulation that Plaintiff has not yet made.

Therefore, because the Warrant in Debt does not provide sufficient detail for the Court to determine the factual and legal basis of Plaintiff’s claims, and thus whether the Court has jurisdiction pursuant to the Carmack Amendment, the Court GRANTS Defendant’s motion for a more definite statement, and DIRECTS Plaintiff to file a more definite statement, explaining the factual and legal basis of Plaintiff’s claims, including Plaintiff’s explanation of the amount in controversy together with any supporting documents or affidavits. The Court TAKES UNDER ADVISEMENT Plaintiff’s motion to remand.

CONCLUSION

For the reasons discussed above, the Court GRANTS Defendant’s motion for a more definite statement, ECF No. 4, and DIRECTS Plaintiff to file a more definite statement within fourteen (14) days, explaining the factual and legal basis of Plaintiff’s claims. The Court TAKES UNDER ADVISEMENT Plaintiff’s motion to remand, ECF No. 10.

The Clerk is REQUESTED to send a copy of this Memorandum Order to counsel for Plaintiff and to counsel for Defendant.

IT IS SO ORDERED.

Norfolk, Virginia

All Citations

— F.Supp.3d —-, 2017 WL 1969479

Footnotes

The facts recited here are stated in the light most favorable to Plaintiff, the party seeking remand. See Venezuela v. Massimo Zanetti Beverage USA, Inc., 525 F. Supp. 2d 781, 783 n.1 (E.D. Va. 2007) (“On a motion to remand, because the burden to prove jurisdiction rests on the party opposing remand, the facts are stated in the light most favorable to the party seeking remand.” (citing Booth v. Furlough, Inc., 995 F. Supp. 629, 630 (E.D. Va. 1998); Kokkonen v. Guardian Life Ins. Co. Of Am., 511 U.S. 375, 377 (1994))).

There appears to be some discrepancy over the filing date of the Warrant in Debt. Consistent with the Williamsburg/James City County General District Court Online Case Information System, Plaintiff alleges that the Warrant in Debt was filed on November 10, 2016. Pl.’s Remand Opening Br. 2; Def.’s Ex. 2-1, at 2. However, consistent with the date listed on the Warrant in Debt, Defendants allege that the Warrant in Debt was filed on December 13, 2016. Notice of Removal ¶ 8; Def.’s Ex. 2, Warrant in Debt, ECF No. 1-2, at 6. Regardless of the Warrant in Debt filing date, Defendant was served with the Warrant in Debt on December 15, 2016. Def.’s Ex. 2, Service of Process Receipt, ECF No. 1-2, at 5.

In declining to make a decision on jurisdiction at this time, the Court does not conclude that it is without jurisdiction, but rather finds that the Plaintiff must provide more information in order for the Court to determine whether the factual and legal basis of Plaintiff’s claims provide original jurisdiction to this Court.

Bits & Pieces