Mlinar v. United Parcel Serv., Inc.

186 So.3d 997

Ivana Vidovic MLINAR, Petitioner,

v.UNITED PARCEL SERVICE, INC., et al., Respondents.

No. SC14–54.

Supreme Court of Florida.

March 3, 2016.

John Scarola, Mara Ritchie Poncy Hatfield, and Patrick Edward Quinlan of Searcy Denney Scarola Barnhart & Shipley, P.A., West Palm Beach, FL; and Shannon M. Mahoney of the Law Offices of Shannon Mahoney, PA, West Palm Beach, FL, for Petitioner.

Evan Seth Gutwein of Hamilton, Miller & Birthisel LLP, Miami, FL, and David Roy Heffernan of Kaire & Heffernan, LLC, Miami, FL, for Respondent United Parcel Service, Inc.

PERRY, J.

This case is before the Court for review of the Fourth District Court of Appeal's decision in Mlinar v. United Parcel Service, Inc., 129 So.3d 406 (Fla. 4th DCA 2013), which the district court certified as being in direct conflict with the Fifth District Court of Appeal's decision in Braid Sales & Marketing, Inc. v. R & L Carriers, Inc., 838 So.2d 590 (Fla. 5th DCA 2003). We have jurisdiction. See art. V, § 3(b)(4), Fla. Const. For the reasons discussed below, we quash the Fourth District's decision to the extent it is inconsistent with this opinion.

STATEMENT OF THE CASE AND FACTS

Ivana Vidovic Mlinar, a professional paint artist, brought an action in circuit court against the United Parcel Service ("UPS") and others, alleging that her two oil paintings were unscrupulously removed from their packaging during the interstate shipment process and subsequently sold to a third party without her knowledge or consent. The Fourth District set forth the relevant facts and circumstances as follows:

[Mlinar] is an artist who created two valuable oil paintings: Advice and The Messenger. Her husband took the paintings to Pak Mail, a third party retailer, to be shipped via UPS to New York. When the container arrived at its intended destination in New York, it was empty. The duct tape had been sliced and the paintings had been removed. [Mlinar] reported the loss to UPS and Pak Mail. Months later, Pak Mail offered her $100 for the missing contents of the package.

At some point, UPS sold the paintings to Cargo Largo, UPS's lost goods contractor. Cargo Largo later auctioned the paintings. An individual named Aaron Anderson purchased one of the paintings at the Cargo Largo auction.

About two years after [Mlinar] lost possession of the paintings, she received a telephone call from Anderson, who informed her that he had just purchased Advice at the Cargo Largo auction sale. Anderson inquired into the value of the painting, and she informed him that it had been appraised to be worth $20,000. He also informed her that The Messenger was auctioned in the same lot, but that he did not know the identity of the purchaser.

Anderson placed a listing online offering to sell Advice and even offering to introduce the buyer to [Mlinar]. He eventually acquired The Messenger as well. He then placed advertisements online in which he offered to sell or trade both paintings, and again offered to introduce the buyer to [Mlinar].

Based on the above facts, [Mlinar] filed suit against UPS, Pak Mail, Cargo Largo, and Anderson. According to the operative complaint, UPS selectively located the contents of her container "based on their nature, probable worth, and lack of insurance," and then sold the paintings to Cargo Largo for "some as of yet undiscovered consideration." UPS also utilized [Mlinar]'s contact information on the back of each painting "to catalogue, sell and/or distribute" the paintings to Cargo Largo.

[Mlinar] asserted four claims in her complaint: Conversion (Count I—against UPS, Cargo Largo, and Pak Mail), Profiting by Criminal Activity (Count II—against UPS, Cargo Largo, and Pak Mail), Unauthorized Publication of Name or Likeness (Count III—against UPS, Cargo Largo, and Anderson), and a claim under Florida's Deceptive and Unfair Trade Practices Act (Count IV—against UPS).

The trial court dismissed all of [Mlinar]'s claims against UPS, ruling that they were preempted by the federal Carmack Amendment.

Mlinar, 129 So.3d at 408–09.

On appeal, the Fourth District also held that Mlinar's state law claims were preempted by the Carmack Amendment, reasoning that the allegations asserted did not involve conduct separate and distinct from the delivery, loss of, or damage to goods, but instead were predicated on or closely related to the performance of the delivery contract. Id. at 410–11. Accordingly, the Fourth District affirmed the trial court's final order of dismissal but certified conflict "[t]o the extent [its] opinion conflicts with the Fifth District's decision in Braid Sales. " Id. at 411–12. Mlinar subsequently filed a notice with this Court to invoke discretionary jurisdiction to review the Fourth District's decision. We granted review.

ANALYSIS

Preemption of State Law Claims

Carmack Amendment¹

The Carmack Amendment to the Interstate Commerce Act was passed in 1906, ch. 3591, § 7, 34 Stat. 595 (1906), and governs the liability of domestic common carriers for losses of or damage to goods en route. King Ocean Cent. Am., S.A. v. Precision Cutting Servs., Inc., 717 So.2d 507, 511 (Fla.1998) (citing Rini v. United Van Lines, Inc., 104 F.3d 502, 503 (1st Cir.1997) ). It specifically provides that certain interstate carriers must "issue a receipt or bill of lading for property ... receive[d] for transportation," and a carrier is held strictly "liable to the person entitled to recover under the receipt or bill of lading ... for the actual loss or injury to the property caused by" the carrier. 49 U.S.C. § 14706(a)(1) ; accord King Ocean Cent., 717 So.2d at 511. The statute expressly recognizes the right of a shipper and carrier to limit the latter's liability to a stipulated value only if the value is "reasonable under the circumstances surrounding the transportation." 49 U.S.C. § 14706(c)(1)(A). The Carmack Amendment further permits a civil action to be brought against a "carrier alleged to have caused the loss or damage, in the judicial district in which such loss or damage is alleged to have occurred." 49 U.S.C. § 14706(d)(2). Finally, the statute includes a "savings clause" stating that "[e]xcept as otherwise provided in this part, the remedies provided under this part are in addition to remedies existing under another law or common law." 49 U.S.C. § 15103 ; accord Multiflex Sys., Inc. v. Reed Transport Serv., Inc., 2010 WL 2363337, at *2 (M.D.Fla. June 11, 2010) ("The savings clause preserves rights and remedies not inconsistent with the rules and regulations prescribed by the provision of this act.") (quoting Smith v. United Parcel Serv., 296 F.3d 1244, 1247 (11th Cir.2002) ).

Congress enacted the Carmack Amendment to achieve uniformity in rules governing liability arising from interstate shipment contracts. UPS Supply Chain Solutions, Inc. v. Megatrux Transp., Inc., 750 F.3d 1282, 1285 (11th Cir.2014) ; King Ocean Cent., 717 So.2d at 511 ; see also Adams Express Co. v. Croninger, 226 U.S. 491, 505, 33 S.Ct. 148, 57 L.Ed. 314 (1913) (explaining that a carrier could be liable for loss of or damage to transported property under the decree of one tribunal while another carrier, who was sued based on the same or substantially similar circumstances, could escape liability in another tribunal). Consistent with this goal, it became well-established that the statute "broadly ‘preempts state law claims arising from failures in the transportation and delivery of goods.’ " Casamassa v. Walton P. Davis Co., Inc., 2008 WL 879412, at *3 (M.D.Fla. Mar. 28, 2008) (quoting Smith, 296 F.3d at 1246 ). However, courts nationwide have also accepted the notion "that situations may exist in which the Carmack Amendment does not preempt all state and common law claims." Smith, 296 F.3d at 1248–49 (citing Gooch v. Or. Short Line R.R. Co., 258 U.S. 22, 42 S.Ct. 192, 66 L.Ed. 443 (1922) ; Chi. Rock Island & Pac. Ry. Co. v. Maucher, 248 U.S. 359, 39 S.Ct. 108, 63 L.Ed. 294 (1919) ; Morris v. Covan Worldwide Moving, Inc., 144 F.3d 377, 383 (5th Cir.1998) ; Reeves v. Mayflower Transit, Inc., 87 F.Supp.2d 1251, 1254 (M.D.Ala.1999) ); see also Gordon v. United Van Lines, Inc., 130 F.3d 282, 289 (7th Cir.1997) ("Nevertheless, not every claim even remotely associated with the transfer of goods from one place to another is necessarily a claim for damages to the shippers' goods."); Schwarz v. Nat'l Van Lines, Inc., 2004 WL 1166632, at *5 (N.D.Ill. May 21, 2004). Nationwide, courts have not settled on a single test to determine whether such claims escape the amendment's preemptive ambit. The conflict extends to Florida's district courts of appeal.

Conflict in Florida Caselaw

Caselaw in this state embraces two competing tests for assessing Carmack Amendment preemption: one is based on alleged harm to the shipper, and the other focuses on the carrier's conduct. We expound upon each test below. However, as also discussed, neither of them need be adopted as the sole standard determining whether common law and state law claims are preempted by the federal statute.

In Braid Sales, the certified conflict case, an owner of machinery that was damaged during shipment by an interstate carrier of goods brought action in circuit court against the carrier. The complaint alleged a breach of an oral contract in which the carrier promised to pay the full cost of repairing the machinery. Braid Sales, 838 So.2d at 591. The Fifth District ultimately determined that the Carmack Amendment did not preempt the claim. Id. at 593. It ruled "that liability arising from separate harms [is] not preempted." Id. (citing Rini, 104 F.3d at 505–06 ). It further noted that "[n]either the Carmack Amendment nor public policy support a carrier's attempt to evade the legal responsibilities voluntarily assumed by entry into an independent contract." Id. (footnote omitted). As such, the Fifth District concluded that the breach "of an alleged oral contract between the parties for payment of repairs, entered into after the shipment was completed, constitutes a...