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Federal Insurance Co. v. Bax Global Inc.

September 20, 2010


The opinion of the court was delivered by: Trager, J.


This action arises from a shipment of twenty-four rolls of carpet, which were damaged while en route from Rancho Santa Fe, California to Calhoun, Georgia. Federal Insurance Company ("F.I.C.") and Stark Carpet Corp. Inc. ("Stark Carpet") (collectively "plaintiffs") bring this action against cargo transporters Mainfreight, Inc. ("Mainfreight") and Bax Global, Inc. ("Bax") (collectively "defendants"), alleging a violation of the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. § 14706, as well as various common law claims.*fn1

Plaintiffs seek $80,606.31 in damages. Pls.' Compl. ¶ 6.

Defendants move to transfer venue to the Southern District of California pursuant to 28 U.S.C. § 1404(a). For the reasons stated below, defendants' motion to transfer is granted.


(1) The Carpet Shipment

Betty Scripps ("Scripps"),*fn2 who resides in Rancho Santa Fe, California, bought twenty-four rolls of carpet from plaintiff Stark Carpet, a Manhattan-based carpet dealer.*fn3 Pls.' Decl. in Opp'n to Defs. Mot. to Transfer ("Pls.' Decl. in Opp'n") at ¶¶ 8, 22. These carpets were custom-made for Scripps' home by non-party Glen Eden Wool Carpets ("Glen Eden"), a carpet manufacturer based in Calhoun, Georgia. Id. at ¶¶ 9, 22. On or about June 25, 2008, Scripps notified Stark Carpet that she wanted to return the carpets because of a "manufacturing deficiency." Pls.' Exs. 6, 14. However, the precise nature of this "deficiency" remains unclear.

On or about June 30, 2008, Stark Carpet arranged to ship the carpets from Scripps to Glen Eden through non-party ICC Logistics Services ("ICC"), a transportation and logistics consulting firm based in Hicksville, New York. Pls.' Decl. in Opp'n ¶ 9. ICC Chief Executive Officer Anthony Nuzio ("Nuzio") and his assistant Pat Kober ("Kober") booked Scripps' return shipment with defendant Mainfreight, an international transportation and logistics company. Id. at ¶ 2; Pls.' Ex. 6.

At some point soon thereafter, the carpets were picked up at Scripps' residence and loaded onto a truck by Scripps' contact person, Bob Clapp ("Clapp"), Scripps' forklift driver and an employee from Now Express Cartage, Inc. ("Now Express"), a local hauling company.*fn4 Mainfreight Mem. of Points and Authorities in Supp. Mot. to Transfer Case Pursuant to 28 U.S.C. 1404(a) ("Mainfreight Mem. in Supp.") at 2; Decl. Matthew T. Loesberg in Supp. Mot. Transfer ("Loesberg Decl.") at ¶ 2. Now Express then transported the carpets from Scripps' home in Rancho Santa Fe to Mainfreight's warehouse in San Diego, California. Rose Decl. at 1. The carpets arrived on or about July 3, 2008, and Mainfreight issued a clean bill of lading*fn5 for the shipment.*fn6 Pls.' Decl. in Opp'n at ¶ 11; Def. Bax's Ex. 2.

Now Express then transported the carpets from Mainfreight's San Diego warehouse to the San Diego facilities of defendant Bax, an international transportation and logistics company subcontracted by Mainfreight for the shipment. Pls.' Decl. in Opp'n at ¶ 25; Bax Reply in Opp'n to Pls.' Letter Mot. to Compel or Sanction Defs. at 1-2, Dec. 23, 2009, ECF No.32 ("Bax Reply in Opp'n to Mot. to Compel"). After receiving the carpets in its warehouse, Bax transported them from San Diego to Atlanta, Georgia. Bax Reply in Opp'n to Mot. to Compel at 1-2. Once in Atlanta, Georgia, a local hauler transported the carpets to Glen Eden in Calhoun, Georgia. Id.

When the carpets were received by Glen Eden on July 11, 2008, they were severely damaged. Pls.' Decl. in Opp'n at ¶ 11. According to a handwritten note on the bill of lading, dated July 11, 2008, the carpets were: "Dirty, some w/ holes[.] Pictures have been taken/has original packaging, never been open."*fn7 Def. Bax's Ex. 2; see also Pls. Ex. 14 (photographs of the damaged carpets).

Glen Eden immediately notified Don Benis ("Benis"), a Stark Carpet employee, that the carpets were damaged. Pls' Decl. in Opp'n at ¶ 12. Benis then contacted Nuzio and Kober at ICC, the New York-based company that had originally booked the shipment with Mainfreight, to inform them of the damage. Id. At Stark Carpet's request, Kober began an investigation on July 14, 2008 to determine exactly when, where and how the damage occurred. Id. at ¶¶ 12-13.

It is unclear from the record exactly what this investigation entailed. However, at the very least, this investigation included a series of inconclusive e-mails, faxes and letters, dated from July 2008 to November 2008, between the following people: Kober and Nuzio, both based in Hicksville, New York; Mainfreight employee Bob Andrews ("Andrews"), based in Greensboro, North Carolina; Mainfreight employee Ed Nowicki ("Nowicki"), based in Carolina Shores, North Carolina; Mainfreight employee Joanne Charles ("Charles"), based in Carson, California; Stark Carpet employee Rob Meistrich ("Meistrich"), based in New York, New York; and Stark Carpet employee Benis, based in Dania Beach, Florida. Pls. Exs. 7-15.

It seems that as part of this investigation, Kober repeatedly attempted to get information from Mainfreight on the shipment, specifically the documentation on each transfer point from Rancho Santa Fe to Calhoun. Pls.' Decl. in Opp'n at 15-18; Pls' Exs. 10, 15. On November 4, 2008, Mainfreight employee Charles e-mailed Kober that she could not provide her with this information but directed Kober to contact Mainfreight employees Andrews and Nowicki, stating that "they may be in a better position to provide this information." Pls.' Ex. 13. On November 24, 2008, Andrews wrote to Kober that: "We are not able to determine exactly where or when the damage occurred. The damage happened while the cargo was in the care of our carrier. Please file the claim with our claim department and they will take it from there."*fn8 Pls.' Ex. 15.

In addition to the investigation performed by ICC, plaintiffs FIC and Stark Carpet hired Charles Williams, a Georgia-based surveyor, to assess the carpet damage at the Glen Eden factory in Calhoun, Georgia. Pls' Decl. in Opp'n at ΒΆ 20. In a report dated November 25, 2008, Williams noted that the carpets could not be repaired because they were stained with grease and dock dirt and contained many cuts. Pls.' Ex. 14. Williams also noted that the ...

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