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Jim Ball Pontiac-Buick-GMC, Inc. v. DHL Express (USA), Inc.

United States District Court, W.D. New York

March 26, 2015

JIM BALL PONTIAC-BUICK-GMC, INC., on behalf of itself and all others similarly situated, and Plaintiff,
DHL EXPRESS (USA), INC., DHL WORLDWIDE EXPRESS, INC., DPWN HOLDINGS (USA), INC., formerly known as DHL Holdings (USA), Inc., Defendants.

Attorneys for Plaintiff DANIEL C. OLIVERIO, JOHN L. SINATRA, JR., REETUPARNA DUTTA, of Counsel The Guaranty Building Buffalo, New York.

QUINN EMANUEL URQUHART & SULLIVAN, LLP Attorneys for Plaintiff RICHARD I. WERDER, JR., of Counsel New York, New York.

DECHERT LLP Attorneys for Defendants JOSEPH F. DONLEY, of Counsel New York, New York.



LESLIE G. FOSCHIO, Magistrate Judge.


This matter is before the undersigned on consent pursuant to 28 U.S.C. § 636(c) filed May 12, 2014 (Doc. No. 104).


This class action, pursuant to 28 U.S.C. § 1332(d), was commenced October 14, 2008. On behalf of itself and a putative nationwide class of shippers, Plaintiff alleges Defendants ("Defendants" or "DHL") providing carrier service to Plaintiff, improperly charged Plaintiff and the class a jet fuel surcharge in connection with the Plaintiff's and the class's shipments, i.e., packages, transported solely via motor vehicles, not involving air transportation in breach of the contracts entered into by the parties with respect to such shipments. Plaintiff alleged it began using DHL's shipping services as early as 1998 when it sent business documents, primarily auto loan credit applications, to business counterparts, auto-loan finance entities, located within a 200-mile radius of Plaintiff's retail auto dealership located in Erie County, New York. Amended Complaint ¶ 58. According to Plaintiff, none of these shipments involved air travel to effect their respective delivery. As a result of Defendants' alleged breaches over many years, Plaintiff seeks damages to numerous, i.e., "several hundred thousand, " id. ¶ 17, putative class members exceeding "tens of millions of dollars." Id. ¶ 68.

This action was originally assigned to Senior District Judge John T. Curtin and was, prior to its transfer to the undersigned, the subject of several substantive motions. At the outset, both parties attempted to obtain partial summary judgment on the competing interpretations of the relevant documents forming the contract between the parties particularly whether such contract permitted DHL to apply a jet fuel surcharge to Defendants' charges to Plaintiff for the shipping of Plaintiff's packages when Defendants used only ground transportation for which, according to Plaintiff, the contract authorized only a diesel fuel surcharge. By Decision and Order, filed May 7, 2010 (Doc. No. 33) ("the May 7, 2010 D&O"), Judge Curtin denied Plaintiff's motion and DHL's cross-motion finding that DHL's 2008 Rate Guide, one of the contract documents the parties have stipulated constitutes the contract, although referencing that DHL's domestic shipping services for same and next day deliveries, and providing that DHL's "Air Express shipments" were subject to a jet fuel surcharge, did not sufficiently indicate that Air Express was meant to define a particular type of shipment service, as DHL urged, such as next day service, or simply a mode of transportation, i.e., by air or ground, which Plaintiff argued would allow either a jet or diesel fuel surcharge depending on whether the package was shipped by air or ground transport or both thus creating ambiguity in the meaning of these contract terms requiring trial. May 7, 2010 D&O at 7-8. In reaching the conclusion that Defendants' use of the term Air Express to permit the disputed jet fuel surcharges as added to Plaintiff's invoices was sufficiently ambiguous to require trial, Judge Curtin found that extrinsic evidence would be admissible, but that such evidence as submitted by Plaintiff was insufficient to support summary judgment. Id.

By Decision and Order filed March 2, 2011 (Doc. No. 58), Judge Curtin denied Plaintiff's motion pursuant to Fed.R.Civ.P. 23 ("Rule 23") for class certification ("March 2, 2011 D&O"). In denying Plaintiff's motion, Judge Curtin found, inter alia, that Plaintiff's claims were subject to the 180-day limitation on filing claims against an interstate motor carrier like DHL as established by the Interstate Commerce Commission Termination Act ("ICCTA"), specifically 49 U.S.C. § 13710(a)(3)(B) ("§ 13710(a)(3)(B)"), and, accordingly, would require the court engage in excessive individual examinations of class members' claims to determine compliance with § 13710(a)(3)(B), and that the class would therefore not be readily ascertainable. March 2, 2011 D&O at 7-8. The court also found that because class members used a variety of shipping arrangements through DHL's individual form contracts, internet sales, and resellers, sufficient commonality of the exact contractual basis for the class claims was not established. Id. at 8.

Judge Curtin further determined that because some class members had used various contractual arrangements to obtain DHL services, resulting in Plaintiff's contract and related defenses being unique, Plaintiff could not demonstrate its claim was typical of the class, March 2, 2011 D&O at 9, and that as individual inquiry would be necessary to determine whether class members' claims were timely filed, Plaintiff failed to show that the proposed class claims predominate over individual claims. Id. at 12. In addition, Judge Curtin held that variances among state law regarding the use of extrinsic evidence to resolve contractual ambiguities prevented Plaintiff from establishing that the proposed nationwide class to enforce Plaintiff's alleged contract claim was superior to individual actions as required by Fed.R.Civ.P. 23(b)(3) ("Rule 23(b)(3)"). Id. at 13-14. Judge Curtin also noted that a lack of reliable information regarding the identity of putative class members rendered the proposed class not readily ascertainable, and that Defendants' lack of records necessary to establish which relevant shipments by the class were solely by ground or air transportation modes also supported that Plaintiff had failed to establish that the proposed class was superior to individual actions, as required for certification by Rule 23(b)(3). Id. at 13-14.

On September 8, 2010 (Doc. No. 53), Plaintiff renewed its motion for summary judgment. In this motion, Plaintiff relied on information obtained through discovery that suggested that because DHL stated the surcharges for both jet and diesel fuel were simply a "pass through" as partial offset to DHL's rising fuel costs, DHL intended the respective surcharges to be linked with the corresponding mode of transportation actually employed by DHL for a specific package, i.e., if by air, a jet fuel surcharge; if by ground, a diesel fuel surcharge. In rejecting Plaintiff's renewed motion, Judge Curtin reiterated that the intent of the parties' based from the actual language utilized in the relevant documents remained sufficiently ambiguous thus requiring reliance on extrinsic evidence to resolve the disputed construction by the trier of fact, and not on summary judgment. Decision and Order dated April 12, 2011 (Doc. No. 61) ("April 12, 2011 D&O") at 3-4. Judge Curtin further stated that any resort to the doctrine of contra proferentem (ambiguities in standard form contract to be construed against party providing contract) as a "last resort" must also await trial. Id. at 5.

On September 28, 2011, Plaintiff filed a renewed motion for class certification based on Plaintiff's proposed exclusion, from the proposed class, of customers who purchased DHL shipping services through a reseller or those for whom whose pricing did not specify one of the surcharges at issue. Judge Curtin nevertheless denied Plaintiff's renewed motion reiterating his previous finding that issues of timely objections required by §13710(a)(3)(B) to the disputed surcharges would require individualized determinations negating Plaintiff's ability to satisfy Rule 23's commonality and typicality requirements. Decision and Order filed February 3, 2012 (Doc. No. 86) ("February 3, 2012 D&O") at 7. Judge Curtin also rejected Plaintiff's attempt to apply equitable tolling to the issue of class members' timely notice of any objection to the disputed DHL jet fuel surcharges. February 3, 2012 D&O at 10. Further, despite Plaintiffs multi-jurisdictional review of state law on the availability of extrinsic evidence, such as course of dealing and the understanding of the parties, to resolve the ambiguity in the applicable contract documents as determined by Judge Curtin, Judge Curtin nevertheless found that variations in state law regarding contract interpretation would "overwhelm the common issues subject to generalized proof and defeat predominance." February 3, 2012 D&O at 13.

On March 21, 2012, Defendants moved for partial summary judgment seeking to limit Plaintiff's damages to billings for shipments after April 13, 2008, 180 days prior to October 10, 2008, when Plaintiff first complained to DHL about the alleged improper jet fuel surcharges, and before April 22, 2008, when Plaintiff stopped using DHL's services and began using a DHL reseller for shipment of its business documents rather than shipping directly with DHL, Plaintiff shortly thereafter transferred its business to UPS, one of Defendants' major competitors. In granting Defendants' motion, Judge Curtin again rejected Plaintiff's contention that the 180-day notice prerequisite established by § 13710(a)(3)(B) was inapplicable to judicial proceedings, Decision and Order filed September 14, 2012 (Doc. No. 93) ("September 14, 2012 D&O") at 4, that a provision in the applicable waybill forms, DHL Exhs. H at 2, J at 2 (Doc. No. 121), providing a one-year period for a billing claim, did not waive a defense based on § 13710(a)(3)(B), and that because Plaintiff was not shown to have been subject to any improper influences or misdirections by DHL impairing Plaintiff's ability to commence suit at an earlier time, equitable tolling was inapplicable. September 14, 2012 D&O at 4-6.

After filing a consent pursuant to 28 U.S.C. § 636(c) in this case on May 12, 2014, the parties conferred with the undersigned on June 25, 2014 (Doc. No. 107), and initially selected a trial date for November 13, 2014 (Doc. No. 108). On September 16, 2014, the parties again conferred with the court to discuss a bench trial in lieu of a jury trial based on the court's review of a protocol guiding preparation for a bench trial ("the protocol") the parties agreed to submit by September 26, 2014 (Doc. No. 110). The parties accordingly submitted the protocol for the court's consideration on September 26, 2014 (Doc. No. 111). Following its review, the court approved the protocol, which was filed September 29, 2014 (Doc. No. 112), and agreed to conduct a non-jury trial commencing December 18, 2014, including oral presentations by counsel and any testimony the parties or the court may require. In the protocol the parties, inter alia, waived a jury trial and established a schedule for the submission of evidence. Doc. No. 112 ¶ 1; ¶ 3. Included in the schedule, the parties agreed that following filing of the various trial documents, the parties could also require, not later than December 4, 2014, the testimony of any witness who submitted any declaration on behalf of an opposing party. Id. ¶ 3(c). Neither side has made such a request and the court found no need for any in-court testimony to assist in its determination of the merits. In accordance with the schedule established by the protocol, the following documents were filed on October 23, 2014:

• Joint Fact Stipulation (Doc. No. 115).
• Jim Ball Pontiac-Buick-GMC, Inc.'s Trial Brief (Doc. No. 114).
• Joint Deposition Designations (Doc. Nos. 116-120).
- Exh. 28 - Jim Ball Deposition, July 29, 2010 (Doc. No. 120)
- Exh. 29 - Gary Prieschel Deposition, July 29, 2010 (Doc. No. 119)
- Exh. 30 - Kevin Grupp Deposition, July 30, 2010 (Doc. No. 118)
- Exh. 31 - Hank Gibson Deposition, August 19, 2010 (Doc. No. 116)
- Exh. 32 - Charles Boice Deposition, March 2, 2011 (Doc. No. 117)
• Joint Exhibit List (Doc. No. 121).
• Jim Ball Trial Exhibits Vol. I, Jim Ball Exhibits 1-31 and ...

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