PHILADELPHIA - A federal judge has denied a motion for reconsideration from a Pennsylvania charity that claimed it found new evidence to support its claim that the charity freight broker’s negligence led to a third-party load carrier damaging one of the charity’s deliveries in transit and injuring one of its volunteers.
On July 31, U.S. District Court for the Eastern District of Pennsylvania Judge Gene E.K. Pratter denied the motion brought by plaintiffs Donald J. Krauss, Cindy G. Brillman, Fightback for Autism, JC Rehab, Inc. and CGB Rehab, Inc. against IRIS USA, Inc. C.H. Robinson Worldwide, Inc. and KV Load.
“Fightback for Autism, a charity in Pennsylvania, contracted to buy Legos from IRIS, a seller in Wisconsin. IRIS hired a freight broker, C.H. Robinson, which in turn hired a carrier, KV Load, to deliver the Legos. But the seller (IRIS) and carrier (KV Load) did not load the Legos in the safe manner that the charity had requested," Pratter wrote.
"Instead, they used old pallets of the wrong size, and they dangerously stacked the pallets one on top of another. The shoddy loading damaged the Legos in transit and caused a pallet to crack during delivery, injuring a volunteer for the charity and damaging a forklift.
“The plaintiffs are a cluster of charities (Fightback, JC Rehab, and CGB Rehab), the charities’ President and CEO (Cindy G. Brillman), and the injured volunteer (Donald J. Krauss). Originally, the defendants were IRIS, the seller of the Lego baseplates; C.H. Robinson, the freight broker; and KV Load, the shipper. KV Load was dismissed from the case late last year.”
Now, the plaintiffs brought three counts against IRIS and C.H. Robinson, comprised of tort and contract claims. In May 2018, the Court held that Mr. Krauss’s personal-injury claim against C.H. Robinson was preempted by the Federal Aviation Administration Authorization Act. The plaintiffs then filed a motion for reconsideration of that ruling on the basis of what they describe as newly-discovered evidence.
Pratter commented that a state law could be pre-empted if it has a “significant economic effect” on a broker’s rates, routes or services. In the instant case, Krauss alleged that C.H. Robinson had negligently selected KV Load as the freight carrier, claiming their quality control process was insufficient.
This past May, the Court held this claim was pre-empted because it went “to the core of what it means to be a careful broker” and would therefore have a significant effect on C.H. Robinson’s services.
“In the pre-emption opinion, the Court noted that the inquiry was ‘fact-specific’ and couched its ‘narrow” ruling ‘in the particular circumstances of this case.’ Seizing on this language, the plaintiffs now argue that evidence discovered after briefing and oral argument undercuts the Court’s decision on pre-emption. Citing this new evidence, the plaintiffs have filed a motion for reconsideration,” Pratter said.
“The supposed new evidence falls into three categories: (1) KV Load’s participation in a special carrier program offered by C.H. Robinson; (2) A notation on the website of the Federal Motor Carrier Safety Administration; and (3) Other general evidence of KV Load’s riskiness. Because the evidence is simply not as groundbreaking as the plaintiffs would have the Court believe, the Court denies the motion for reconsideration.”
Pratter explained the first category of new evidence is a notation about KV Load in C.H. Robinson’s internal computer system that was entered 10 days before the accident:
2/9/2015: NO CARRIER MANAGEMENT – From branch rep WARRCHR for ROYFALE, “Please remove this carrier from PCM,” Removed, Marked DNA
“The plaintiffs argue that this notation demonstrates that C.H. Robinson’s extant processes were sophisticated enough to flag KV Load as a problematic carrier. In other words, no ‘heightened’ process would be needed to avoid this kind of accident in the future. As a result, this argument goes, a tort claim against C.H. Robinson would have no ‘significant economic effect’ on C.H. Robinson’s services, so the claim would not be pre-empted,” Pratter said.
In its response to the motion, C.H. Robinson explains that nothing in the notation bears on KV Load’s safety or performance:
• “NO CARRIER MANAGEMENT” means that KV Load opted out of a program that C.H. Robinson offers to carriers who wish to be contacted by only one C.H. Robinson office, as opposed to every office nationwide. In other words, KV Load elected to accept shipments from C.H. Robinson offices nationwide, rather than only one office.
• “PCM” stands for “priority carrier managed” and is part of the carrier management program that KV Load opted out of.
• “DNA” stands for “do not apply.” This notation tells workers at C.H. Robinson not to apply KV Load toward the optional carrier management program.
Pratter said the Court was satisfied that the “newly-discovered” evidence wasn’t the key piece of evidence the plaintiffs believed it would be and did not change the Court’s initial conclusion on pre-emption.
“The next category of evidence purportedly supports the plaintiffs’ theory that C.H. Robinson should have known that KV Load was a risky carrier. Evidently, C.H. Robinson’s regular practice is to scour the website of the Federal Motor Carrier Safety Administration (FMCSA) to see if carriers have been charged with safety violations. Roughly two weeks before the accident at issue here, FMCSA recorded safety violations by KV Load. Relatedly, the plaintiffs argue that C.H. Robinson should have received information about KV Load’s riskiness from a private subscription service for freight brokers,” Pratter stated.
Pratter added even if both pieces of evidence were new, it didn’t seem as though C.H. Robinson knew about KV Load’s safety violations, despite the former’s efforts to discover proof of same.
“Thus, the Court’s conclusion in its preemption opinion is still correct: C.H. Robinson would have needed a heightened process to discover KV Load’s latest safety violations, meaning that a tort claim against C.H. Robinson would significantly affect the broker’s services and would still be preempted. Finally, the plaintiffs present new evidence that C.H. Robinson knew that KV Load was not an overly conscientious shipper. In particular, KV Load made several late deliveries in 2014 – in one instance, because a driver overslept,” Pratter said.
“It may well be, as a matter of state negligence law, that evidence of such infractions should have precluded a hyper-careful freight broker from hiring KV Load again. But that very conclusion goes ‘to the core of what it means to be a careful broker’ and would therefore have a significant effect on C.H. Robinson’s services. The Court’s prior conclusion that the state tort claim is preempted remains unchanged.”
The plaintiffs are represented by David G. Concannon and Matthew T. Charles of Concannon & Charles, in Wayne.
The defendants are represented by Thomas P. Bracaglia of Marshall Dennehey Warner Coleman & Goggin, plus Barry L. Cohen, Joshua Upin, Meaghan Petetti Londergan and Sean Sebastian Litz of Royer Cooper Cohen Braunfeld, all of Philadelphia.
U.S. District Court for the Eastern District of Pennsylvania case 2:17-cv-00778
From the Pennsylvania Record: Reach Courts Reporter Nicholas Malfitano at nickpennrecord@gmail.com