Appeal from the United States District Court for the Northern District of Illinois, Eastern Division.
No. 93 C 7326--James F. Holderman, Judge.
Before COFFEY, MANION, and DIANE P. WOOD, Circuit Judges.
DIANE P. WOOD, Circuit Judge.
Decided November 21, 1997
When the elderly and ailing Ruth Slavin decided to move from her home in Florida to the Chicago area, in order to be close to her daughter, she turned to United Van Lines to handle the relocation of her personal belongings. What resulted can only be described as every family's worst nightmare: from its earliest contact with her, through its agent who never made clear to her what kind of coverage she needed for her goods, to its failure to deliver her most priceless family memorabilia and heirlooms and its four-month course of deception pertaining to that nondelivery, United represented everything wrong with a moving company. Eventually, Mrs. Slavin (who has since died and whose estate, through its administrator Mark Gordon, continues as a litigant) and her daughter Rachelle Gordon (collectively, the Gordons) sued United under a variety of theories. They prevailed before a jury in their action for liability under the Carmack Amendment to the Interstate Commerce Act, 49 U.S.C. sec. 11707 (1994), now codified at 49 U.S.C. sec. 14706, but the district court dismissed the remaining counts of their suit before trial as preempted by the Carmack Amendment.
The principal question before us is whether the district court properly understood the breadth of the Carmack Amendment's preemptive force. We also must decide whether federal common law provides a basis for awarding punitive damages in a Carmack Amendment suit, and whether the district court properly allowed the jury to award damages for some of the items that United had destroyed. We reaffirm our holding in Hughes v. United Van Lines, Inc., 829 F.2d 1407 (7th Cir. 1987), that the Carmack Amendment preempts all state law claims based upon the contract of carriage, in which the harm arises out of the loss of or damage to goods. Nevertheless, in keeping with North American Van Lines, Inc. v. Pinkerton Security Systems, Inc., 89 F.3d 452 (7th Cir. 1996), we also reaffirm that claims involving a separate and independently actionable harm to the shipper distinct from such damage are not preempted. Because we find that one of the Gordons' claims is not preempted under these two cases, we reverse that part of the case for further proceedings. Otherwise, we find no error in the district court's rulings.
At the time Mrs. Slavin decided to move, she was an 80-year old widow in failing physical health. She was legally blind in one eye, and the vision in her other eye was so impaired that she could no longer read. She also wore a hearing aid, was able to walk only with the aid of a walker, and could not write because of her arthritis. She called a United Van Lines agency in Florida, where she was then living, and it sent one of its agents to her home. There she met twice with the agent, who was aware of her limited sight, impaired hearing, and manual difficulties. She specifically instructed the agent that some of her items were to go to her new apartment in Chicago, and others were to go to her daughter Rachelle's home. She explained that the boxes going to Rachelle's contained the most important things she owned: linens and candlesticks handed down from her own mother, about 200 old and rare books collected by her deceased husband, china cups from around the world that she had collected over a period of 40 years, and approximately 15,000 family photographs. The photographic collection covered a period of more than 100 years. It included a picture of her mother and her mother's two sisters taken in Europe in the early days of 19th century photography, other photographs dating from the 1860's, immigration photographs from her mother's family, photographs of historic significance including many of her father with such personalities as Clarence Darrow, Adlai Stevenson, Michigan Governor G. Mennen Williams, and President Franklin Delano Roosevelt, as well as countless photographs of more personal interest.
The jury found that United's agent never obtained Mrs. Slavin's agreement regarding insurance against the loss of her treasured possessions. At the time the contract was signed, the agent simply wrote in the bill of lading that Mrs. Slavin released United from liability for loss or damage to the goods exceeding $1,000. Mrs. Slavin, before her death, testified that she did not read the bill of lading before she signed it, for the simple reason that she was physically unable to do so--a fact which she told the agent. For its part, United now concedes that it charged her for $10,000 of Replacement Cost Protection.
United never delivered any of the goods destined for Rachelle's home. On May 7, 1993, after the driver delivered to Mrs. Slavin the boxes marked for her apartment, he told her that he was taking the other boxes over to the Gordons' home. Mrs. Slavin called Rachelle and told her the driver was on his way with the ten boxes and would be there in a matter of minutes. (The two lived just one mile apart.) Rachelle waited, but no one showed up. Hours later, the driver contacted her and told her that he had decided instead to drive to the Cook Moving depot (United's local agent) in Elk Grove Village. He said that he would deliver the boxes the next day (a Saturday), because he did not want to drive back into Chicago through the afternoon traffic. Saturday came and went, Rachelle waited, but no one from United arrived. As later became clear, the driver had decided not to deliver the boxes himself. Rather, on Friday afternoon he had put the boxes into the car of one Tom Walker, a day laborer recommended by Cook's operations manager, paid Walker $40, and told him to deliver the boxes the next day. To put it mildly, Walker fell down on the job. Instead of delivering the boxes as promised, he threw them away, and they were incinerated.
Concerned about the fate of the boxes when they did not show up on Saturday, Rachelle called the numbers United had furnished on the shipping invoice on the following Monday to try to find out what had happened. The dispatcher at Cook Moving told her that he "knew all about" her shipment, that the driver had been called out of town, and that she would have her goods by the end of the week. Again, of course, no delivery took place. Rachelle again called Cook Moving to ask about it. She continued calling for nearly three months. Each time she called, she was told that the items were in the United warehouse and were safe there. Finally, on August 3, United sent Rachelle a claim form, acknowledging the loss of that part of the shipment.
On December 3, Mrs. Slavin and Rachelle Gordon filed suit against United to recover for their losses. (Mrs. Slavin, as we noted, died during the pendency of the suit, and Mark Gordon, the administrator of her estate, was substituted for her.) Their suit asserted breach of the contract for carriage (Count I); liability under the Carmack Amendment (Count II); liability under the Bill of Lading Act, 49 U.S.C. sec. 102 (Count III); common law fraud (Count IV); violation of the Illinois Consumer Fraud and Deceptive Business Practices Act, 815 ILCS 505 *fn1 et seq. (Count V); intentional infliction of emotional distress (Count VI); breach of contract (Count VII); and ...