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Fireman's Fund Insurance Co., As Subrogee of Alliant Techsystems, Inc v. Reckart Logistics

September 13, 2011

FIREMAN'S FUND INSURANCE CO., AS SUBROGEE OF ALLIANT TECHSYSTEMS, INC.,
PLAINTIFF,
v.
RECKART LOGISTICS, INC., S&G TRANSPORT SERVICES, INC., AND MR. BULT'S, INC., A/K/A MBI, DEFENDANTS.
MR. BULT'S, INC., A/K/A MBI, AND RECKART LOGISTICS, INC., THIRD-PARTY PLAINTIFFS,
v.
FORE TRANSPORTATION, INC., THIRD-PARTY DEFENDANT.



The opinion of the court was delivered by: Matthew F. Kennelly, District Judge:

MEMORANDUM OPINION AND ORDER

Fireman's Fund Insurance Co. (Fireman's Fund), as subrogee of Alliant Techsystems, Inc. (Alliant), has sued Reckart Logistics, Inc. (Reckart), S&G Transport Services, Inc. (S&G), and Mr. Bult's, Inc. (MBI) under the Interstate Commerce Act, 49 U.S.C. § 14706, and various state-law claims. Reckart and MBI have asserted contribution claims against Fore Transportation, Inc. (Fore) based on its alleged negligence.

In this decision, the Court considers three motions for summary judgment. Fireman's Fund seeks partial summary judgment on its claim against MBI. S&G seeks summary judgment on Fireman's Fund's claim. Fore has moved for summary judgment on MBI's third-party claim. For the reasons stated below, the Court grants the first two motions and postpones decision on the third.

Background

In deciding a motion for summary judgment, the Court must view the facts in the light most favorable to the non-moving party and must draw reasonable inferences in that party's favor. See, e.g., Ault v. Speicher, 634 F.3d 942, 945 (7th Cir. 2011). The following facts are taken from the parties' memoranda of law, their statements of uncontested facts, and exhibits they have submitted in connection with the summary judgment motions.

In late January 2008, Alliant, a manufacturer of ammunition and other products, purchased a quantity of copper and zinc. Alliant then arranged for Olin Brass to fabricate the metals into brass coils at its facility in East Alton, Illinois. To transport the brass coils to its Lewiston, Idaho factory, Alliant hired Reckart as a freight broker -- a middleman between buyer and shipper that handles logistics for complicated shipments. Alliant's materials manager informed Olin's shipping clerk that it had engaged Reckart's services and left it to Olin and Reckart to coordinate the transport.

Rick Bittinger, the broker at Reckart who was responsible for handling Alliant's shipment, looked for a carrier to transport the material. In addition to cold-calling several trucking companies, he posted the shipment specifications on several websites on which freelance truck drivers can seek work (including "Internet Truckstop" and "GetLoaded.com"). Bittinger testified that he received a call in response to one of these postings from a man who identified himself only as "Sam" and who claimed to be the owner of "S&G Transportation." Reckart had never worked with S&G before. After Bittinger and Sam agreed on a rate, Bittinger asked to fax Sam a contract and requested a W-9 form, proof of insurance, and a Department of Transportation certificate. Sam provided a fax number to which Bittinger then sent the contract (the fax number turned out to belong to an Office Depot store). Bittinger received from the same fax number a signed contract and the other documents that he had requested, all of which contained information purportedly applying to S&G.

Around the same time, David Bult, a terminal manager for MBI in St. Louis, also received a call from a man identifying himself as "Sam." Bult testified that Sam called in response to an ad Bult had placed on GetLoaded.com about his company's availability for freelance transport. He stated that Sam asked if an MBI truck could move a load of brass coils from East Alton to Chicago for $550 in cash. Bult agreed and arranged for one of MBI's drivers to handle the shipment.

On February 4, 2008, the MBI driver arrived at Olin's East Alton facility and picked up half the amount of brass coils that Alliant had ordered, accompanied by a bill of lading indicating that the brass was bound for Idaho. The driver, John Michaelis, testified that Bult had instructed him to take the shipment to Chicago, notwithstanding the directions on the bills of lading, and then call Sam's cell phone for more specific directions. Michaelis did so and was told to bring the brass to Fore's warehouse. Once there, the shipment was "cross-docked" (moved from one truck to another) onto an unknown vehicle. Bult then had another nearly identical conversation with Sam regarding the other half of Alliant's Brass, after which he dispatched driver Raymond Plymale, who followed the same steps as Michaelis.

Neither load of brass coils has been seen since being cross-docked by Fore. Fireman's Fund, Alliant's insurer, paid Alliant for the cost of raw materials and fabrication and then brought suit as subrogee against Reckart, S&G, and MBI. Fireman's Fund asserted claims against all three defendants for negligence, breach of bailment, and violation of 49 U.S.C. § 14706, commonly known as the "Carmack Amendment" to the Interstate Commerce Act. Reckart and MBI, as third-party plaintiffs, then asserted contribution claims against Fore, alleging negligence. Reckart has since settled with Fireman's Fund and dismissed its claims against Fore, and for all intents and purposes it is no longer a party to this case. The Court previously dismissed all of Fireman's Fund's claims against S&G except those under the Carmack Amendment.

Discussion

Summary judgment is appropriate "if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law." Fed. R. Civ. P. 56(a). "As to materiality, the substantive law will identify which facts are material . . . . Factual disputes that are irrelevant or unnecessary will not be counted." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). A court may grant summary judgment "where the record taken as a whole could not lead a rational trier of fact to find for the non-moving party." Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986).

1. Fireman's Fund's Motion for Partial Summary Judgment

Fireman's Fund has moved for partial summary judgment against MBI on the issue of liability under the Carmack Amendment. The Carmack Amendment states that any "carrier providing transportation or service" shall be "liable . . . for the actual loss or injury to the property caused by (A) the receiving carrier, (B) the delivering carrier, or (C) another carrier over whose line or route the property is transported . . . ." 49 U.S.C. § 14706(a)(1). It was passed in order to replace the "disparate schemes of carrier liability that existed among the states" with a uniform system that would provide greater predictability for both shippers and carriers. REI Transport, Inc. v. C.H. Robinson Worldwide, Inc., 519 F.3d 693, 697 (7th Cir. 2008). The effect of the Carmack ...


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