Eagle Suspensions, Inc. v. Hellmann Worldwide Logistics, Inc.

571 F. App'x 281
CourtCourt of Appeals for the Fifth Circuit
DecidedJune 9, 2014
Docket13-10519
StatusUnpublished
Cited by2 cases

This text of 571 F. App'x 281 (Eagle Suspensions, Inc. v. Hellmann Worldwide Logistics, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Eagle Suspensions, Inc. v. Hellmann Worldwide Logistics, Inc., 571 F. App'x 281 (5th Cir. 2014).

Opinion

PER CURIAM: *

This case involves a contract for the carriage of two industrial presses to Oklahoma from Mexico. Eagle originally purchased the presses for use in Oklahoma, and Hellmann is a freight forwarder who was hired to arrange carriage. As both parties agree, the presses never left Mexico and were never delivered to Eagle. After a jury trial, Hellmann was found liable to Eagle for breach of contract and breach of fiduciary duty under Texas law. On appeal, Hellmann asks us to vacate the district court’s judgment and remand for a new trial based on one challenge to an evidentiary ruling and three purported errors in the jury instructions.

First, Hellmann argues that the district court violated Rule 411 of the Federal Rules of Evidence by allowing questions during trial related to Hellmann’s purchase of insurance. Second, Hellmann argues that the jury instructions included claims under Texas law that are preempted under federal common law. Third, and in the alternative to its preemption argument, Hellmann argues that the jury instructions misstated the relevant rule of *283 Texas law governing the foreseeability of consequential damages. Fourth, Hell-mann argues that the jury instructions misalloeated the burden of proof for demonstrating a breach of fiduciary duty under Texas law.

For the reasons set forth below, we reject each of Hellmann’s four arguments and affirm the district court’s judgment.

I.

On February 29, 2012, Eagle filed a complaint with the district court containing three distinct claims against Hellmann under federal law and Texas law. Eagle claimed first that, by failing to deliver the industrial presses, Hellmann had violated a rule of federal common law governing “non-delivery of goods” in cases involving cross-border shipping. This rule of federal common law, according to Eagle’s position at the time (and Hellmann’s position now), operates to extend “the principles and framework set out in the Carmack Amendment to the Interstate Commerce Act” to cover cross-border shipments that are not actually covered by the Carmack Amendment’s literal text. 1 Second, Eagle claimed that Hellmann had committed a breach of contract under Texas law. Third, Eagle claimed that Hellmann had breached a fiduciary duty arising under Texas law based on the parties’ agency relationship.

Hellmann filed its original answer on April 4, 2012. The answer denied a number of Eagle’s specific allegations and raised several defenses. But Hellmann’s answer did not raise any defenses related to federal preemption. Nor did Hellmann make any mention of the applicable law in its original answer.

Hellmann did not file a motion to dismiss in this case. On August 31, 2012, both Hellmann and Eagle filed motions for summary judgment, at which point the applicable law became one of the central questions in the lawsuit. Initially, Hell-mann argued in its motion for summary judgment that federal law was inapplicable because, in Hellmann’s view, the literal text of the Carmack Amendment does not cover shipments originating in a foreign country. Instead, Hellmann argued, Florida law should apply under Texas’s choice-of-law rules. Eagle, by contrast, argued in its own motion for summary judgment that federal common law should apply to Eagle’s claim for nondelivery, whereas Texas law should apply to Eagle’s claims for breach of contract and breach of fiduciary duties. Finally, in Hellmann’s response to Eagle’s motion, Hellmann argued — for the first time — that Eagle’s claims for breach of contract and breach of fiduciary duty are preempted by the same body of federal common law invoked by Eagle in support of the federal claim for non-delivery.

On December 20, 2012, the district court issued a one-page order denying both parties’ motions for summary judgment because “these motions presented] genuine issues of material fact.” The district court’s brief order did not address any *284 questions relating to the applicable law or federal preemption.

The parties prepared for trial. On January 25, 2013, Hellmann submitted a proposed jury charge reflecting the positions regarding federal common law and federal preemption that Hellmann had first adopted during the summary judgment briefing. That is, Hellmann’s proposed jury charge lacked any jury instruction based on Texas law, and had no jury instruction at all pertaining to breach of contract or breach of fiduciary duty. Hell-mann’s proposed jury charge also stipulated “that [Hellmann] did not deliver to [Eagle] the two presses that are at issue in this case.” Hellmann’s proposed jury charge would therefore have submitted only issues relating to mitigation and the amount of damages for consideration by the jury. Subsequently, on February 6, 2018, the parties jointly filed a proposed pretrial order, in which Hellmann again repeated its argument that “principles of national uniformity ... warrant[ ] the application of federal common law instead of state law” in this case. Finally, during a pretrial conference on February 8, 2013, the district court acknowledged the parties’ dispute regarding federal preemption, but also explicitly postponed decision of that question. Indeed, there was no motion relevant to the question of federal preemption pending before the district court at the time of the pretrial conference.

The district court also heard argument at the pretrial conference regarding the application of Rule 411 of the Federal Rules of Evidence in the context of Hell-mann’s pending motion in limine. As Hell-mann’s attorney acknowledged during the pretrial conference, however, Hellmann itself intended to introduce evidence during trial to show “that Heilman offered Eagle the opportunity to get insurance” and that Eagle had not done so.

Trial began on March 18, 2013. Prior to jury selection, the district court made its final ruling regarding the introduction of evidence relating to the parties’ insurance under Rule 411. As the district court explained, it would be inappropriate to “prohibit either side from raising the question of insurance in this case,” given Hell-mann’s understanding that “one of the main issues in this case is who had the obligation to pay insurance when that was never apparently negotiated explicitly between the parties.” The district court therefore ruled that both parties would be permitted to introduce evidence relating to insurance.

On the second day of trial, on March 19, 2013, the district court distributed copies of the draft jury charge and verdict form to the parties. At this time, the district court asked the parties to return those copies to the district court on the following day and “attach sheets of paper” or make “comments in the margin” expressing any objections, which the district court would then use to compose the final jury charge and verdict form.

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Cite This Page — Counsel Stack

Bluebook (online)
571 F. App'x 281, Counsel Stack Legal Research, https://law.counselstack.com/opinion/eagle-suspensions-inc-v-hellmann-worldwide-logistics-inc-ca5-2014.