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GEORGE WEINTRAUB SONS, INC. v. E.T.A. TRANSPORTATION

August 27, 2003

GEORGE WEINTRAUB SONS, INC., PLAINTIFF,
v.
E.T.A. TRANSPORTATION, INC., DEFENDANT



The opinion of the court was delivered by: John Martin, District Judge

OPINION & ORDER

Plaintiff brings this diversity action for breach of contract of carriage and breach of bailment based on non-delivery of goods from Mexico to the United States. The parties cross-move for summary judgment on the issue of liability.

FACTUAL BACKGROUND

Plaintiff George Weintraub & Sons, Inc. ("Weintraub") is a men's apparel importer and wholesaler. Defendant E.T.A. Transportation, Inc. ("E.T.A.") is a transportation broker and is licensed as a motor carrier in the United States. E.T.A. Logistics Services is an E.T.A. division that makes arrangements for third-party import and export shipments.

On April 15, 2000, Plaintiff sent its vendor, Confecciones Europeas, S.A. de C.V. ("Confecciones"), instructions to have a shipment of men's apparel sent directly by truck from Weintraub's vendor in Mexico to its customer, Men's Warehouse, in Houston, Texas. A copy of these instructions was also sent to Schaefer [ Page 2]

Transportation, Inc. ("Schaefer"), a freight forwarding company that arranges transportation for all of Plaintiff's incoming shipments. Schaefer makes arrangements for Weintraub shipments on its own behalf as explained by George Weintraub, Plaintiff's owner and chairman: "[Schaefer's] rates are quoted to us without their knowledge of what they're paying for shipping. S.o, if they have arrangements with truckers, it's not through us that they have them. They make their own arrangements." Plaintiff does not directly deal with the companies with which Schaefer contracts to carry out Plaintiff's shipping needs.

On April 25, 2000, Schaefer sent a fax to a company called Jefco requesting that it "schedule a truck for hanging garments" for George Weintraub & Son's. Schaefer also faxed this information to Confecciones and E.T.A.

On April 26, 2000, E.T.A.'s Logistics Services Division faxed a "Carta de Instrucciones" to Transportation Especial Autostrada, S.A. de C.V. ("TEA"), a Mexican trucking company, instructing it to pick up Weintraub's garments at Confecciones in Mexico and transport them to E.T.A.'s terminal in Laredo, Texas.

TEA picked up the shipment and issued its talon or bill of lading covering transportation from Mexico to Laredo, Texas to Confecciones. The bill of lading clearly states on its face that "this merchandise travels without insurance . . ." On its reverse side, the bill of lading states: "If the `shipper' requires the [ Page 3]

`carrier' to assume the responsibility of the value of the goods or any other liability or risk, including the cases of accidents, hijacking or force majeure, both of them must have a written agreement outlining this clause and stating the additional charges that will be incurred." Weintraub did not insure the goods with TEA but did purchase inland marine insurance, for the load.

On April 28, 2000, shortly after the truck carrying the goods left the Confecciones facility in Mexico, armed thieves hijacked it and stole the goods.

Plaintiff claims it entered into a contract of carriage with the Defendant to have it transport the shipment as a common carrier. Plaintiff argues that Defendant is liable for the value of the stolen goods even if they were in the possession of TEA at the time of their loss because TEA was Defendant's subcarrier and was hired by ETA to perform a portion of the contract of carriage.

Defendant argues that it only agreed to arrange transportation for the goods from Mexico to the United States and is not liable for their loss because it was not negligent in the selection of a carrier. Moreover, Defendant argues that it is not liable for breach of bailment ...


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