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TROY CONTAINER LINE LTD. v. HOUSEWARES INC.
March 29, 2004.
TROY CONTAINER LINE, LTD., Plaintiff; -against- HOUSEWARES, INC., Defendant
The opinion of the court was delivered by: LEWIS KAPLAN, District Judge
This is an action for breach of contract to recover in consequence of
the alleged return of defendant's check in the amount of $3,815.*fn1 The
sole alleged basis of jurisdiction is the Shipping Act of 1984, which is
codified in various sections of the appendix to title 46 of the United
States Code. The complaint does not cite any particular section of the
statute which is alleged to confer jurisdiction. By order dated March
19, 2004, the Court, acting pursuant to its obligation to inquire into
its own jurisdiction, directed plaintiff to show cause why this action
should not be dismissed for
lack of subject matter jurisdiction.
Plaintiffs response to the order to show cause asserts that
jurisdiction is proper pursuant to Section 14(d)(1) of the Shipping Act
of 1984. Section 14(d) in its entirety provides:
"(1) In case of violation of an order of the
Commission for the payment of reparation, the
person to whom the award was made may seek
enforcement of the order in a United States
district court having jurisdiction of the parties.
"(2) In a United States district court the findings
and order of the Commission shall be prima facie
evidence of the facts therein stated, and the
petitioner shall not be liable for costs, nor for
the costs of any subsequent stage of the
proceedings, unless they accrue upon his appeal. A
petitioner in a United States district court who
prevails shall be allowed reasonable attorney's
fees to be assessed and collected as part of the
costs of the suit.
"(3) All parties in whose favor the Commission has
made an award of reparation by a single order may
be joined as plaintiffs, and all other parties in
the order may be joined as defendants, in a single
suit in a district in which any one plaintiff could
maintain a suit against any one defendant. Service
of process against a defendant not found in that
district may be made in a district in which is
located any office of, or point of call on a
regular route operated by, that defendant. Judgment
may be entered in favor of any plaintiff against
the defendant liable to that plaintiff"*fn2
Plaintiff attaches also a copy of a letter from the director of the
Office of Consumer Complaints at the Federal Maritime Commission ("FMC")
to the defendant concerning plaintiff's complaint regarding the return of
defendant's check. The letter states that "certain bad faith actions in
connection with the payment of freight constitute violations of Section
10(a)(1) of the Shipping Act of 1984" and expresses the author's opinion
that defendant "may have violated" that statute. It notes that plaintiff
has the option of seeking an order of the FMC with respect to the freight
The foregoing demonstrates that the Shipping Act does not confer
jurisdiction on the district courts in actions to collect bad checks.
Rather, Section 14 grants the district courts jurisdiction to enforce
orders of the FMC. Thus, if plaintiff is determined to litigate this case
in a federal court, it first will have to obtain a reparation order from
the FMC. Of course, it is free also to pursue the matter in the small
claims part of the New York State courts.
The action is dismissed for lack of subject matter jurisdiction.
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