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October 16, 1995

T.B.I. INDUSTRIAL CORP., Plaintiff, against EMERY WORLDWIDE, a Consolidated Freight Corporation, Defendant. EMERY WORLDWIDE, a CF Company, Third-Party Plaintiff, - against - ABN AMRO BANK, N.V., NEW YORK BRANCH; CLASSIC CUSTOM BROKERS, INC.; KIRON LULLA, an individual; HIRO DASANI, an individual; DEEPAK KHUBCHAWDAMI, an individual; and ISHA DASANI, an individual, Third-Party Defendants.


The opinion of the court was delivered by: BATTS

DEBORAH A. BATTS, United States District Judge.

 Plaintiff T.B.I. Industrial Corp. ("T.B.I.") moves for summary judgment on its suit to recover the value of goods improperly delivered by the defendant Emery Worldwide ("Emery"). Emery opposes the motion, and cross moves for partial summary judgment limiting the maximum recovery of T.B.I. on the basis of a limitation of liability clause contained in the contract between the parties and relevant air waybills. Further, third-party defendants ABN Amro Bank ("Amro"), and Kiron Lulla ("Lulla") move for summary judgment and sanctions against third-party plaintiff Emery, who has brought this third-party action seeking to hold third-party defendants Amro, Classic Customs Brokers ("Custom"), and Lulla liable in the event Emery is held liable to T.B.I. Third-party defendant Classic moves under Rule 37(d) of the Federal Rules of Civil Procedure for sanctions, including attorneys fees and dismissal of the third-party Complaint, due to Emery's failure to appear for a scheduled deposition. Emery opposes the motions of the third-party Defendants, relying principally on a claimed need for additional discovery.


 Plaintiff T.B.I. is the exclusive representative in the United States of Shanghai Fong Run Foreign Trade Corporation ("Shanghai"). On October 16, 1992, the New York branch of third-party Defendant Amro Bank issued an irrevocable documentary letter of credit for $ 117,000 listing the beneficiary as Plaintiff T.B.I. and the applicant as Take Away Styles, Ltd. ("Take Away"), with an expiration date of February 28, 1993. On the basis of this letter of credit, Shanghai and Plaintiff T.B.I. sold silk ladies blouses to Take Away for $ 104,319 in late February 1993. In March 1993, Shanghai shipped the blouses to the United States from China via China National Foreign Trade Transportation Corporation ("Sinotrans"), whose agent and air forwarder in the United States is defendant Emery. At the time of shipping, Sinotrans issued an air waybill *fn1" consigning the goods to "Order ABN AMRO BANK, N.V." and listing Shanghai as the shipper. Third-party defendant Classic appears on the air waybill in a box labeled "Also Notify." This air waybill states that it was executed in Shanghai on March 13, 1993, suggesting that the goods were shipped on that date.

 Sinotrans consolidated these goods for shipment and contracted with Air China for their delivery to New York. Air China issued a master waybill for the consolidated shipment. The merchandise arrived in the United States and cleared customs on March 19, 1993. Emery subsequently moved the merchandise to its warehouse, located near -- but not on -- the premises of John F. Kennedy International Airport.

 Emery alleges that third-party defendant Classic issued a pick-up order for the shipment of blouses on March 19, 1993 as the customs clearing broker. Mandeep Trucking then took the pick-up order, and delivered it along with a check for $ 8,057.47 for shipping costs to defendant Emery on March 23, 1993. On that date, upon receipt of the pick-up order and the check for $ 8,057.47, but without receiving the original air waybill, Emery released the shipment of blouses to Mandeep Trucking.

 Two weeks later, on April 6, 1993, the Bank of Communications, acting on behalf of T.B.I., forwarded to Amro the letter of credit along with the documents relating to the shipment of blouses, including the air waybill. By telex on or about April 8, 1993, Amro refused to honor the letter of credit due to various discrepancies, including expiration of the letter of credit and late presentation. On May 7, 1993, the Bank of Communications requested return of the documents, and they were returned on May 18, 1993.

 On January 14, 1994, Plaintiff T.B.I. brought suit in New York County Supreme Court, seeking to recover the value of the blouses from defendant Emery. On March 4, 1994, Defendant Emery removed the action to this Court on the basis of the presence of a federal question.

 On June 17, 1994, Take Away filed for Chapter 7 protection in the Southern District of New York, and a trustee was appointed who sold all the remaining inventory of Take Away, including any remaining unsold stock from the shipment in question.

 On July 28, 1994, Emery filed a third-party Complaint naming Amro, Classic, Lulla, Hiro Dasani, Deepak Khubchawdami, and Isha Dasani; Emery subsequently voluntarily discontinued the third-party action as to Hiro Dasani, Khubchawdami, and Isha Dasani by stipulation.

 T.B.I. now moves for summary judgment pursuant to Rule 56(a) against Emery for the full value of the misdelivered goods; Emery responds by seeking to obtain additional discovery, apparently fishing for evidence of some action on the part of Plaintiff or Third-Party Defendants that would affect Emery's liability, and simultaneously cross-moves to cap its liability pursuant to the waybill's liability limitation provision.


 A. Summary Judgment Standards

 Summary judgment is appropriate when "there is no genuine issue as to any material fact and . . . the moving party is entitled to a judgment as a matter of law." Fed.R.Civ.P. 56(c). The movant bears the burden of establishing the absence of any genuine issue of material fact. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 256, 106 S. Ct. 2505, 2514, 91 L. Ed. 2d 202 (1986); Celotex Corp. v. Catrett, 477 U.S. 317, 323, 106 S. Ct. 2548, 2553, 91 L. Ed. 2d 265 (1986). "In determining whether there is a genuine issue as to any material fact, the court is required to resolve all ambiguities and draw all inferences in favor of the party against whom summary judgment is sought." LaFond v. General Physics Services Corp., 50 F.3d 165, 175 (2d Cir. 1995). However, the nonmovant "may not defeat a motion for summary judgment merely by pointing to a potential issue of fact; there must be a genuine issue of material fact." Moller v. North Shore University Hospital, 12 F.3d 13, 15 (2d Cir. 1993), quoting City of Yonkers v. Otis Elevator Co., 844 F.2d 42, 45 (2d Cir. 1988).

 B. Plaintiff's Motion for Summary Judgment Against Defendant Emery

 1. Liability

 "A carrier is ordinarily liable for the value of the shipment when it delivers the shipment to someone other than the party entitled to receive them." Kologel Co., Ltd. v. Down in the Village, Inc., 539 F. Supp. 727, 728-29 (S.D.N.Y. 1982). There is no doubt, and Emery even concedes, that "plaintiff's consignment was delivered to someone other than the consignee on the [relevant] air waybill." (Def. Reply Memo of Law, at 1.) Accordingly, because Emery delivered the shipment to someone other than the party authorized to receive it, Emery is liable to Plaintiff for the value of the goods. Kologel, 539 F. Supp. at 729-30.

 Classic's issuance of a pick-up order to Mandeep Trucking, reliance upon which apparently caused Emery to release the goods at issue, does not affect Emery's liability to T.B.I. Designation as the "also notify" party on the air waybill merely entitled Classic to notification of arrival; the consignee alone held the authority to receive or release the goods. Kologel, 539 F. Supp. at 729. Accordingly, the Plaintiff is entitled to summary judgment against Emery, as limited below.

 2. Emery's request for more discovery

 In opposition, Emery makes a singular, and unconvincing, argument. Emery argues that Plaintiff's and Third-Party Defendants' motions should be denied because Emery has been denied pretrial discovery. Defendant Emery requests additional discovery, and pursuant to Rule 56(f) of the Federal Rules of Civil Procedure, has submitted an affidavit through counsel setting forth the additional discovery sought.

 For Defendant to oppose successfully summary judgment under Rule 56(f), its affidavit must explain: "(1) the information sought and how it is to be obtained; (2) how a genuine issue of material fact will be raised by that information; (3) what efforts the affiant has made to obtain the information; and (4) why those efforts were unsuccessful." Sage Realty Corp. v. Insurance Co. of N. Am., 34 F.3d 124, 128 (2d Cir. 1994). According to Emery's Rule 56(f) affidavit, "Emery seeks to discover plaintiff's and third-party defendants' involvement in the alleged misdelivery . . . ." (Def. Rule 56(f) Aff. P 4.) The information is sought through depositions of third-party defendants Amro, Classic, and Lulla, as well as non-party witness Bank of Communications.

 "Emery seeks to show that third-party defendants acted or omitted to act in such a way that led to Emery's eventual release of the goods. Such genuine issues of material fact conflict directly with plaintiff's and third-party defendants' allegations set forth in their summary judgment motions." (Def.'s Rule 56(f) Aff. P 7.) At no point does Emery hint at or ...

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