EFL Global LLC v. Uber Freight LLC

• Court: District Court, N.D. California
• Decided: March 31, 2026
• Docket: 3:25-cv-07214
• Status: Unknown

Opinion

1 2 3 4 5 IN THE UNITED STATES DISTRICT COURT 6 FOR THE NORTHERN DISTRICT OF CALIFORNIA 7 8 EFL GLOBAL LLC, Case No. 25-cv-07214-CRB

9 Plaintiff,

ORDER GRANTING MOTION TO 10 v. DISMISS

11 UBER FREIGHT LLC, 12 Defendant.

13 This case arises from two cargo thefts in early-2025, in which unknown individuals 14 impersonating authorized carriers obtained valuable freight shipments arranged through 15 Defendant Uber Freight LLC’s (“Uber Freight”) online freight brokerage platform. 16 Plaintiff EFL Global LLC (“EFL”), a freight forwarder and logistics company, alleges that 17 Uber Freight’s failures to verify carrier identity, maintain adequate platform security, and 18 to ensure employee oversight, caused EFL to suffer losses of $713,769.23 due to the stolen 19 cargo. 20 EFL brings five causes of action: breach of contract, negligence, gross negligence, 21 declaratory relief, and breach of the implied covenant of good faith and fair dealing. Uber 22 Freight moves to dismiss the complaint in its entirety. 23 For the reasons set out below, the Court GRANTS Uber Freight’s motion to 24 dismiss and DISMISSES the complaint in its entirety WITH LEAVE TO AMEND.1 25 26

27 1 Pursuant to Civil Local Rule 7-1(b), the Court determines that these motions are suitable for I. BACKGROUND 1 A. Factual Background 2 EFL is a company headquartered in New York with its principal place of business 3 in Florida. FAC ¶ 2. EFL is in the business of freight forwarding, cargo logistics, and 4 shipping services. Id. EFL is not a California-based entity. Defendant Uber Freight LLC 5 (“Uber Freight”) is a freight broker headquartered in Delaware with its principal place of 6 business in California. Id. ¶ 4. Uber Freight engages in logistics coordination, freight 7 brokerage, and transportation management services. Id. ¶ 5. 8 1. Lululemon Shipment 9 In February 2025, EFL contracted with Uber Freight to arrange truck brokerage 10 services to transport a container of Lululemon apparel from Los Angeles, California to 11 Groveport, Ohio. First Amended Complaint (“FAC”) ¶ 21. Uber Freight prepared the 12 load for delivery scheduled for February 19, 2025. Id. ¶ 25. On February 17, 2025, two 13 days before the scheduled delivery, Uber Freight “allowed an imposter to pick up the load 14 and released the load to the imposter.” Id. ¶ 26. Uber Freight notified EFL the same day 15 that an imposter had stolen the container. Id. ¶ 27. Lululemon subsequently filed a formal 16 claim with EFL for $338,890.81, representing the value of the stolen merchandise, and 17 EFL filed a formal claim against Uber Freight. Id. ¶¶ 31–32. EFL paid Lululemon 18 $336,682 in November 2025 for the value of stolen merchandise minus the value of 19 recovered items. Id. ¶ 33. The FAC alleges that Uber Freight failed to verify the identity 20 of the trucker who arrived, failed to safeguard its internal computer systems against 21 improper access and carrier impersonation, and failed to follow up with relevant 22 transportation contractors to ensure that the correct entities accepted the pickup. Id. ¶¶ 34– 23 38. EFL further alleges, on information and belief, that one or more Uber Freight 24 employees or agents were involved in the theft, and that Uber Freight’s online system had 25 been subject to a data breach. Id. ¶¶ 37–38. No facts are alleged in support of either 26 contention beyond bare assertion. 27 2. Urban Outfitters Shipment 1 In March 2025, EFL again contracted with Uber Freight to arrange the transport of 2 a large Urban Outfitters shipment from Los Angeles, California to Reno, Nevada. Id. ¶¶ 3 39–40. On April 1, 2025, Uber Freight “allowed two different drivers who were 4 impersonating carriers to pick up the two Urban Outfitters loads and released the two loads 5 to the impersonators.” Id. ¶ 43. The total value of the shipment was $377,087.23. Id. ¶ 6 44. Urban Outfitters filed a formal claim with EFL for that amount, and EFL filed a 7 formal claim against Uber Freight. Id. ¶¶ 45–46. 8 Critically, unlike the Lululemon shipment, the FAC does not allege that EFL has 9 paid Urban Outfitters any portion of its $377,087.23 claim. The FAC alleges only that the 10 claim was filed and acknowledged. See FAC ¶¶ 45–52. 11 As with the first theft, EFL alleges on information and belief that Uber Freight 12 employees or agents were involved and that Uber Freight’s computer systems had been 13 compromised. Id. ¶¶ 48–52. The FAC further alleges that Uber Freight failed to 14 implement corrective safeguards after the first theft, demonstrating awareness of the risk 15 and indifference to its recurrence. Id. ¶¶ 50–53. 16 B. The Agreement 17 In 2025, EFL contracted with Uber Freight for freight brokerage services by 18 accepting Uber Freight’s Shipper Platform Terms and Conditions of Service (the 19 “Agreement”), a clickwrap agreement prepared by Uber Freight. Id. ¶¶ 11–12, Ex. A. 20 EFL describes the Agreement as a “non-negotiable click the box contract.” Id. ¶ 15. 21 The Agreement governed EFL’s use of Uber Freight’s online platform to, among 22 other things, create shipments, receive price quotes, tender shipments to carriers, and track 23 shipment details. See FAC, Ex. A at §§ 1.1, 2.1. The Agreement clearly states the 24 services Uber Freight was to provide to EFL: 25 § 1.1 Access to Services. Uber Freight will establish a Customer 26 corporate account that will enable Customer to access the Platform and the Uber Freight Service that may be offered there 27 from time to time. 1 § 2.1 Customer Account. [. . .] The Platform will enable Customer to do one or more of the following (as may be 2 available in the platform from time to time): (a) build shipments and receive price quotes from Uber Freight for the Uber Freight 3 Service, (b) tender a shipment to Uber Freight, another broker, and/or a motor carrier and (c) view detailed shipment and 4 shipment transportation information, which may include, without limitation, customer User name together with request 5 time and date, information about the cargo and shipment, the name and other identifying information of the motor carrier and 6 motor carrier driver performing the transportation services, location information of the motor carrier and/or motor carrier 7 driver performing the transportation services, information about the equipment being used by the motor carrier to provide the 8 transportation services, . . . Uber Freight personnel contact persons and their contact information . . . trip route, distance and 9 duration, and the price charged by Uber Freight . . . . Uber Freight reserves the right to add, remove and update features and 10 functionality of the platform at any time. 11 FAC Ex. A at §§ 1.1, 2.1. 12 Several other provisions of the Agreement bear directly on the claims at issue. 13 Section 6 of the Agreement defines Uber Freight’s role as a freight broker and 14 expressly disclaims any liability for damaged or lost cargo:

15 Uber Freight LLC is a federally licensed freight broker . . . .

16 UBER FREIGHT IS NOT A MOTOR CARRIER. NO INTERPRETATION OF WRITTEN OR ORAL REMARKS IN 17 ANY AGREEMENT OR DOCUMENT SHALL BE CONSTRUED TO IMPLY UBER FREIGHT IS A MOTOR CARRIER. 18 . . . 19 The motor carrier shall be solely responsible for . . . (iv) any cargo 20 loss or damage in accordance with applicable United States federal law up to $100,000 per shipment . . . . Uber Freight does not assume 21 any liability or financial responsibility for property or cargo, including any loss, theft, damage or delayed delivery thereof. 22 23 Id. at § 6 (emphases added). 24 Section 7.3 provides, in all-capital letters, that Uber Freight offers its platform and 25 services “‘AS IS’ AND WITHOUT WARRANTY.” Id. at § 7.3. The section also 26 expressly disclaims any warranty that the platform or services will be “uninterrupted or 27 error free.” Id. 1 excludes any consequential, incidental, punitive, and special damages entirely. Id. at § 8.1. 2 The limitation does not apply to fees owed by the customer to Uber Freight or to “fraud or 3 willful criminal acts.” Id. EFL’s complaint does not allege fraud or willful criminal acts. 4 See FAC. 5 Section 10.1 designates Delaware law as the applicable law governing all disputes 6 arising under the Agreement, except to the extent governed by applicable federal law. Id. 7 at § 10.1. Section 10.2 provides that the Agreement “constitutes the entire agreement 8 between the parties with respect to the subject matter hereof and supersedes all other 9 agreements and understandings, both written and oral.” Id. at § 10.2. The Agreement is 10 therefore fully integrated. 11 C. EFL’s Complaint 12 EFL’s FAC asserts five causes of action, all premised on the same underlying 13 events. 14 EFL’s first cause of action alleges breach of contract arising from Uber Freight’s 15 supposed failure to perform its contractual obligations by, inter alia, failing to ensure its 16 online platform was secure, failing to adequately vet carriers and employees, and releasing 17 cargo to unauthorized parties without sufficient safeguards to prevent improper access. 18 FAC ¶¶ 58–66. 19 EFL’s second and third causes of action allege negligence and gross negligence 20 respectively, asserting that Uber Freight breached a duty of care in its performance of 21 freight brokerage services. Id. ¶¶ 67–97. 22 EFL’s fourth cause of action seeks declaratory relief invalidating two contractual 23 provisions as unconscionable under California Civil Code §§ 1670.5 and 1668: (1) the 24 Delaware choice-of-law clause and (2) the $20,000 liability cap. Id. ¶¶ 98–104. 25 Finally, EFL’s fifth cause of action alleges breach of the implied covenant of good 26 faith and fair dealing, contending that Uber Freight’s operational and security failures 27 deprived EFL of the benefit of the Agreement and resulted in substantial damages. Id. ¶¶ 1 EFL filed its original complaint in August 2025. EFL filed its First Amended 2 Complaint on November 25, 2025. Uber Freight subsequently moved to dismiss. Mot. 3 (dkt. 25). 4 II. LEGAL STANDARD 5 A party may bring a motion to dismiss under Federal Rule of Civil Procedure 6 12(b)(6) for failure to state a claim upon which relief can be granted. To survive a Rule 7 12(b)(6) motion, the complaint must “contain sufficient factual matter, accepted as true, to 8 ‘state a claim to relief that is plausible on its face.’” Ashcroft v. Iqbal, 556 U.S. 662, 678 9 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). “A claim has 10 facial plausibility when the plaintiff pleads factual content that allows the court to draw the 11 reasonable inference that the defendant is liable for the misconduct alleged.” Id. While 12 the Court accepts factual allegations as true and views them in the light most favorable to 13 the plaintiff, “a formulaic recitation of the elements of a cause of action” and “naked 14 assertion[s]” devoid of further factual backing are insufficient. Id. 15 III. DISCUSSION 16 A. Choice of Law and Unconscionability 17 1. Choice of Law 18 Before reaching the merits of EFL’s claims, the Court must determine what state’s 19 laws govern this dispute. The Agreement states: “Except to the extent governed by 20 applicable United States federal law, this Agreement shall be governed by and construed in 21 accordance with the laws of the State of Delaware, without regard to its choice or conflict 22 of law provisions.” FAC, Ex. A at § 10.1. As explained below, federal law preempts a 23 majority of EFL’s causes of action. To the extent any claims survive federal preemption, 24 the Agreement’s Delaware choice-of-law provision governs, and the Court applies 25 Delaware law accordingly. EFL’s unconscionability challenge to the choice-of-law 26 provision fails. 27 A federal court sitting in diversity applies the choice-of-law rules of the forum state. 1 law framework, contractual choice-of-law provisions are generally enforced provided that 2 the chosen state bears a substantial relationship to the parties or the transaction, or there is 3 any other reasonable basis for the parties’ choice. Nedlloyd Lines B.V. v. Super. Ct., 3 4 Cal.4th 459, 465–66 (1992). A party’s place of incorporation suffices to satisfy both 5 prongs. See Nezri v. PayPal, Inc., 606 F. Supp. 3d 985, 991 (C.D. Cal. 2022) (“There is a 6 substantial relationship between the parties and Delaware because PayPal was incorporated 7 under the laws of Delaware.”). Both parties in the instant case are incorporated under the 8 laws of Delaware and thus the record establishes a substantial relationship with Delaware 9 and a reasonable basis for the choice-of-law designation. 10 Where, as here, the threshold requirement is met, California courts enforce a 11 choice-of-law provision unless the opposing party demonstrates that (1) applying the 12 designated state’s laws would contravene a fundamental policy of California, and (2) 13 California has a materially greater interest than the chosen state in the resolution of the 14 dispute. Nedlloyd, 3 Cal.4th at 466; LeBouef v. NVIDIA Corp., 2019 WL 13210428, at 15 *6 (N.D. Cal. Nov. 18, 2019). Neither factor is met here. 16 On the first prong, EFL argues that California has a fundamental policy against 17 enforcing unconscionable contracts, citing California Civil Code §§ 1670.5 and 1668.2 18 These provisions, however, do not reflect some sort of unique rule inherent to California 19 law — the statutes reflect general contract law doctrines empowering courts to decline to 20 enforce unconscionable contractual terms. They do not represent a policy so fundamental 21 to California that courts shall be compelled to refuse to honor a contractual choice-of-law 22 provision, particularly where the designated state in the choice-of-law provision recognizes 23 the same or a similar doctrine under statute and common law. See, e.g., Del. Code § 2-302 24 (empowering courts to refuse to enforce contracts or provisions that are found to be 25 unconscionable). Federal courts sitting in diversity in California regularly apply Delaware 26

27 2 California Civil Code § 1670.5 states that courts are not to enforce a contract or any clause of a 1 law to similar claims for breach of contract, negligence, gross negligence, and breach of 2 the implied covenant of good faith and fair dealing, without finding any contravention of 3 fundamental California policy. See Chang Fang v. CMB Exp. Infrastructure Grp. 48, LP, 4 773 F. Supp. 3d 963, 980–81, 983, 984 (E.D. Cal. 2025) (upholding Delaware choice-of- 5 law clause in case alleging negligence, gross negligence, breach of contract, and breach of 6 the implied covenant of good faith and fair dealing). 7 Regarding the second prong, EFL also fails to demonstrate that California has a 8 materially greater interest in this dispute relative to Delaware. The relevant factors include 9 the place of contracting and performance, the location of the subject matter, and the 10 domicile, residence, and place of incorporation of the parties. See Ruiz v. Affinity 11 Logistics Corp., 667 F.3d 1318, 1324 (9th Cir. 2012). On balance these factors do not 12 favor California. EFL emphasizes that Uber Freight’s principal place of business is in 13 California and that the cargo pickups occurred at California facilities. Opp’n (dkt. 27) at 14 10. These facts certainly establish some connection with California. But they do not tip 15 the balance. Performance of a contract in California does not, without more, override a 16 Delaware choice-of-law provision selected by Delaware-based entities providing services 17 on a nationwide scale. See CLEAResult Consulting, Inc. v. EnerNOC, Inc., 2017 WL 18 4638592, at * (D. Del. Oct. 16, 2017) (assessing states’ relationship to the dispute by 19 weighing factors like the protection of justified expectations, predictability, ease, and 20 where the injury took place). Uber Freight coordinates freight around the country – 21 permitting the law of any state in which goods happen to originate to displace a negotiated 22 choice-of-law provision would undermine the basic predictability such provisions are 23 designed to provide. 24 Accordingly, the Delaware choice-of-law provision is enforceable, and Delaware 25 law governs EFL’s state law claims to the extent they are not preempted by federal law. 26 2. Unconscionability 27 The Court, as discussed above, applies Delaware law to evaluate EFL’s 1 Like California, Delaware law requires a showing of both procedural and substantive 2 unconscionability. Rummel, Klepper & Kahl, LLP v. Del. River & Bay Auth., 2022 WL 3 29831, at *14 (Del. Ch. Jan. 3, 2022). EFL’s challenge fails under this standard. 4 As to procedural unconscionability, Delaware courts focus on the “relative 5 bargaining strength of the parties.” Marina View Condo. Ass’n of Unit Owners v. 6 Rehoboth Marina Ventures, LLC, 2018 WL 1172581, at *8 (Del. Ch. Mar. 6, 2018). 7 Delaware courts are particularly “reluctant to find unconscionability in contracts between 8 sophisticated corporations. Unconscionability is generally found where ‘[a] party with 9 superior bargaining power used it to take unfair advantage of [its] weaker counterpart.’” 10 Northern Data AG v. Riot Platforms, Inc. 2025 WL 1661855, at *16 (Del. Ch. June 2, 11 2025) (brackets in original). Here, EFL’s procedural unconscionability theory rests on the 12 allegation that the Agreement is a “non-negotiable click the box contract.” FAC ¶ 15. But 13 both parties are sophisticated commercial entities: EFL is a freight forwarding and logistics 14 company that arranges cross-country transport of high-value goods, and Uber Freight is a 15 nationally operational freight broker. The FAC contains no allegation that EFL lacked the 16 ability to seek alternative freight brokerage services, or that it was subject to surprise or 17 concealment of any particular contractual term. The mere fact that the Agreement was 18 presented in a standard clickwrap format does not, without more, support procedural 19 unconscionability. See Evans v. PayPal, Inc., 2023 WL 6058490, at *2 (9th Cir. Sept. 18, 20 2023) (mem.). 21 As to substantive unconscionability, Delaware requires that the challenged terms 22 represent “a gross imbalance that ‘shocks the conscience’” or that the terms appear “so 23 extreme as to appear unconscionable according to the mores and business practices of the 24 time and place.” Rummel, 2022 WL 29831, at *14. The Agreement’s liability cap and 25 choice-of-law provisions are standard features of contracts. Not only is the limitation of 26 liability provision standard, it appears in all-capital letters under a conspicuous heading. 27 FAC, Ex. A at § 8.1. And the choice-of-law provision is unremarkable in light of the fact 1 these terms are “highly substantively unconscionable,” FAC ¶ 15, is insufficient to survive 2 a motion to dismiss. 3 As a final note, the same result would arise under California law, which also 4 requires some measure of both procedural and substantive unconscionability, and similarly 5 does not treat clickwrap assent alone as sufficient for the procedural element. See Pandolfi 6 v. AviaGames, Inc., 2024 WL 4051754, at *9 (N.D. Cal. Sept. 4, 2024) (“As noted above, 7 under California law, there must be both procedural and substantive unconscionability in 8 order for an agreement to be rendered invalid[.]”); Levin v. Caviar, Inc., 146 F. Supp. 3d 9 1146, 1157 (N.D. Cal. 2015) (finding clickwrap agreement enforceable). 10 Accordingly, EFL’s declaratory relief claim — to the extent it relies on the alleged 11 unconscionability of the Agreement’s choice-of-law or liability limitation provisions — 12 fails as a matter of law and is DISMISSED. 13 B. FAAAA Preemption 14 The Federal Aviation Administration Authorization Act (“FAAAA”) was enacted to 15 deregulate the trucking industry and prevent a patchwork of state laws from disrupting the 16 interstate freight market. See Cal. Trucking Ass’n v. Su, 903 F.3d 952, 960–61 (9th Cir. 17 2018). To accomplish that goal, Congress included a preemption provision: “a State . . . 18 may not enact or enforce a law, regulation, or other provision having the force and effect 19 of law related to a price, route, or service of any . . . broker, or freight forwarder with 20 respect to the transportation of property.” 49 U.S.C. § 14501(c)(1) (emphasis added). The 21 parties do not dispute that Uber Freight is a “broker” or “freight forwarder” under the 22 terms of the FAAAA. See FAC, Ex. A at § 6 (“Uber Freight LLC is a federally licensed 23 freight broker as defined by 49 U.S.C. § 13102(2).”); Mot.; Opp’n (“EFL is a freight 24 forwarder and logistics provider.”). Courts recognize a narrow exception, discussed 25 below, for personal injury claims arising from motor vehicle collisions. 26 All of EFL’s claims against Uber Freight arise from Uber Freight’s performance of 27 freight brokerage services, and the FAAAA’s preemption provision applies broadly to 1. Negligence and Gross Negligence Claims (Second and Third 1 Causes of Action) 2 EFL’s second and third causes of action allege that Uber Freight was negligent 3 and/or grossly negligent in its performance of freight brokerage services by, among other 4 things, failing to verify carrier identity, failure to secure its online platform against 5 unauthorized access, and failing to adequately vet its employees. FAC ¶¶ 67–97. These 6 claims arise directly from Uber Freight’s conduct as a freight broker and are preempted by 7 the FAAAA under Miller v. C.H. Robinson Worldwide, Inc., 976 F.3d 1016 (9th Cir. 8 2020). 9 The Ninth Circuit in Miller interpreted the phrase “related to” broadly, 10 encompassing state laws “having a connection with or reference to . . . rates, routes or 11 services, whether directly or indirectly.” Miller, 976 F.3d at 1022 (internal quotation 12 marks omitted). State tort law claims qualify as a “law, regulation, or other provision” 13 under the FAAAA’s preemptive scope. See id. at 1023–25. Thus, the Ninth Circuit held 14 that a negligence claim against a freight broker for negligent selection of a motor carrier — 15 which caused a traffic collision injuring the plaintiff — was preempted by the FAAAA 16 because the claim arose from the broker’s arrangement of transportation services. Id. at 17 1024–25. The court reasoned that the broker’s service of selecting and engaging motor 18 carriers is the core of what a freight broker does, and a negligence claim premised on that 19 conduct has the requisite “connection with” the broker’s services to trigger preemption. 20 Id. 21 EFL argues that its negligence claims are “temporally and substantively distinct” 22 from transportation services because they target Uber Freight’s platform security and 23 internal oversight practices rather than the movement of goods itself. Opp’n at 4. This 24 argument overlooks the fact that the entirety of EFL’s relationship with Uber Freight arose 25 by virtue of a freight brokerage agreement entered into “for the transportation of property.” 26 49 U.S.C. § 14501(c)(1); see also FAC ¶¶ 12–13 (stating that the parties entered into the 27 Agreement “which provided in part that Uber Freight would provide freight brokerage 1 for transportation by third-party motor carriers”). The online platform through which Uber 2 Freight builds shipments, engages carriers, and tracks loads is merely the mechanism by 3 which Uber Freight carries out its brokerage service — it is not a separate product. 4 Separating the broker’s platform from its brokerage function would risk reducing the scope 5 of FAAAA preemption to the point of ineffectiveness. 6 Moreover, EFL’s negligence allegations target the core of what Uber Freight does. 7 EFL alleges that Uber Freight owed a duty to arrange transport by authorized carriers, 8 failed to confirm the identity of the driver who arrived to pick up the shipment, and 9 released cargo to an imposter. FAC ¶¶ 67–97. These are not allegations of pre- or post- 10 transport conduct. These allegations concern the core functions that Uber Freight 11 performs: selecting, engaging, and monitoring carriers in connection with transportation. 12 Under Miller, such claims are preempted. EFL’s reliance on Anderson v. Pour, 2014 WL 13 5699646, at *1–3 (N.D. Cal. Nov. 4, 2014), is thus misplaced. In Anderson, the court 14 found a state law claim was not preempted because it concerned a logistics company’s 15 post-transport handling of a damage claim. Id. This conduct exclusively took place after 16 the goods had arrived and transportation was complete. The court was careful to note that 17 the plaintiff’s claim “focuse[d] on [defendant’s] processing of [plaintiff’s] claim after the 18 Camaro was no longer in transit,” and that the plaintiff had pled his claim “to focus 19 exclusively on those activities which took place after the service provided by the motor 20 carrier ended.” Id. at *5–6. Here, EFL’s allegations concern conduct taking place during 21 active transportation. That is a categorically different matter from Anderson. 22 Finally, the FAAAA contains a limited carveout providing that its preemption 23 provision “shall not restrict the safety regulatory authority of a State with respect to motor 24 vehicles.” 49 U.S.C. § 14501(c)(2)(A). In Miller, the Ninth Circuit held that this “safety 25 exception” preserved the plaintiff’s negligence claim because that claim arose from a 26 motor vehicle collision on a public state highway, which was precisely the kind of motor 27 vehicle safety hazard the exception was designed to address. 976 F.3d at 1030–31. The 1 extent that they arise out of motor vehicle accidents, have the requisite ‘connection with’ 2 motor vehicles. Therefore, the safety exception applies to Miller’s claim against C.H. 3 Robinson.” Id. at 1031. That limiting language is critical to this dispute. 4 The FAC does not allege that the cargo thefts at issue arose from a motor vehicle 5 collision on a public roadway. The containers appear to have been stolen from private 6 facilities, with no collision precipitating the theft. Nor are public road safety hazards in 7 any way implicated. The safety exception to FAAAA preemption thus is not applicable. 8 This conclusion is consistent with recent, persuasive authority from courts in this circuit. 9 See Jeunesse, Inc. v. NTG Air & Ocean, LLC, 2025 WL 2020005, at *4 (C.D. Cal. June 10 17, 2025) (agreeing that claims “‘arising out of the mere theft of cargo from a motor 11 vehicle do not qualify” for the safety exception to FAAAA preemption) (quoting Minder v. 12 Real Int’l SCM Corp., No. 2:23-cv-3292-DSF-PVC (C.D. Cal. Nov. 17, 2023)). The court 13 reasoned that Miller expressly limited the safety exception to claims arising from motor 14 vehicle crashes or similar safety incidents, and that extending the exception to cargo theft 15 would expand it beyond the terms of the Ninth Circuit’s holding. Id. (“[E]ven under 16 Miller’s broad interpretation of the safety exception, the alleged theft of cargo here is not 17 ‘connected with’ the regulation of motor vehicle safety.” (emphasis in original)); see also 18 Dainese USA, Inc. v. Coyote Logistics, LLC, 2025 WL 2958873, at *2 (C.D. Cal. Sept. 9, 19 2025) (“Plaintiff overstates the Ninth Circuit’s holding in Miller, which only considered 20 claims against brokers ‘that stem from motor vehicle accidents.” (emphasis in original)). 21 EFL relies principally on Milk Specialties Co. v. Sandair Corp., 753 F. Supp. 3d 22 1043 (E.D. Cal. 2024) and Megawatt Group, LLC v. Patterson Companies, Inc., 2024 WL 23 5372407 (C.D. Cal. June 14, 2024), both of which applied the safety exception to cargo 24 theft claims that did not involve motor vehicle collisions. To the extent those decisions 25 extend the safety exception to claims arising outside the motor vehicle collision context, 26 this Court finds Miller, Jeunesse, and Dainese more persuasive. The purpose of FAAAA 27 preemption is to prevent state law from imposing obligations on freight brokers that 1 safety exception exists to preserve state police powers over a narrowly-defined concern: 2 physical danger posed by motor vehicles on public roads. City of Columbus v. Ours 3 Garage & Wrecker Serv., Inc., 536 U.S. 424, 426 (2002) (holding that the safety exception 4 to FAAAA preemption “evinces a clear purpose to ensure that the preemption of States’ 5 economic authority over motor carriers of property ‘not restrict’ the preexisting and 6 traditional state police power over safety, ‘a field which the States have traditionally 7 occupied’”) (quoting Medtronic, Inc. v. Lohr, 518 U.S. 470, 485 (1996)). Reading the 8 safety exception broadly to encompass any state law claim with some connection to motor 9 vehicles or cargo brokerage could risk restoring the pre-FAAAA status quo, in contrast 10 with Congress’s intent. 11 Accordingly, the narrower reading of the safety exception honors both the text and 12 purpose of the FAAAA, and EFL’s second and third causes of action are therefore 13 preempted by the FAAAA and therefore dismissed. EFL’s second and third causes of 14 action are thus DISMISSED. 15 2. Implied Covenant of Good Faith and Fair Dealing (Fifth Cause of Action) 16 EFL’s fifth cause of action alleges that Uber Freight breached the implied covenant 17 of good faith and fair dealing by failing to maintain adequate platform security, failing to 18 vet carriers and employees, and otherwise performing the Agreement in bad faith. FAC ¶¶ 19 105–13. 20 This claim is preempted by the FAAAA for the same reasons as the negligence 21 claims. District courts within the circuit have recognized that claims grounded in state- 22 law-imposed duties, rather than the express terms of a contract, are preempted by the 23 FAAAA because they effectively regulate the broker’s services through the mechanism of 24 state law. The implied covenant of good faith and fair dealing is, by definition, a condition 25 superimposed by state law onto contracts; it is not a term negotiated or agreed to by the 26 parties. As courts in this district have held: “Conditions implied by law are conditions 27 imposed by law — state law; they are not negotiated by the contracting parties. Claims 1 based on violation of the covenant of good faith are therefore preempted.” Samica Enters., 2 LLC v. Mail Boxes Etc. USA, Inc., 637 F. Supp. 2d 712, 720 (C.D. Cal. 2008). 3 EFL contends that its implied covenant claim targets Uber Freight’s internal 4 security failures rather than its prices, routes, or services, and it therefore falls outside the 5 scope of FAAAA’s preemption provision. Opp’n at 7 (“EFL’s claim for breach of implied 6 covenant of good faith and fair dealing is not preempted by the FAAAA because the FAC 7 does not allege conduct related to prices, routes, or brokerage services within the meaning 8 of the statute.”). That argument fails for many of the same reasons discussed above in 9 relation to EFL’s negligence claims. Moreover, EFL cannot sever Uber Freight’s platform 10 operations from its freight brokerage services for preemption purposes while 11 simultaneously premising its claim on Uber Freight’s performance of its obligations under 12 a freight brokerage agreement. 13 Accordingly, the Court DISMISSES EFL’s fifth cause of action. 14 C. Alternative State Law Grounds for Dismissal 15 Even if the FAAAA did not preempt any of EFL’s claims, many causes of action 16 independently fail to state a claim upon which relief can be granted under applicable state 17 law. As established above, Delaware law governs EFL’s state law claims. 18 1. Breach of Contract Claim (First Cause of Action) 19 To state a claim for breach of contract under Delaware law, a plaintiff must 20 demonstrate: (1) the existence of the contract, whether express or implied; (2) the breach 21 of an obligation imposed by the contract; and (3) damage to the plaintiff. VLIW Tech., 22 LLC v. Hewlett-Packard Co., 840 A.2d 606, 612 (Del. 2003). Critically, the complaint 23 must identify the specific contractual provision breached. See, e.g., Breakaway Sols., Inc. 24 v. Morgan Stanley & Co. Inc., 2004 WL 1949300, at *11 (Del. Ch. Aug. 27, 2004) (“To 25 survive a motion to dismiss, the plaintiff must identify which provisions or terms of the 26 contract were breached by the conduct at issue.”); Collins & Aikman Corp. v. Stockman, 27 2009 WL 1530120, at *31 (D. Del. May 20, 2009) (“A well-pleaded breach of contract 1 that is alleged to have been violated.”). EFL’s breach of contract claim fails to state a 2 claim under this standard. 3 The FAC premises Uber Freight’s alleged breach on three general categories of 4 failure: (1) failing to ensure or take reasonable steps to ensure that its online vendor system 5 was secure; (2) failing to vet vendors, carriers, and third parties who had access to its 6 system; (3) failing to vet its employees and agents to ensure they did not engage in 7 improper activities; and (4) failing to put safeguards in place to prevent improper access, 8 fraud, impersonation, or theft. FAC ¶ 61. None of these obligations appear in the express 9 terms of the Agreement. 10 The provisions that EFL invokes as the source of these obligations — sections 1.1 11 and 2.1 — do not support such a broad reading of Uber Freight’s obligations to EFL. 12 Section 1.1 states that Uber Freight will establish a customer corporate account enabling 13 EFL to access the platform. FAC, Ex. A at § 1.1. Section 2.1 enumerates the functions the 14 platform will make available to EFL as the customer: building shipments, receiving price 15 quotes, tendering shipments, and viewing shipment information. Id. at § 2.1. These 16 provisions describe what EFL, as a customer, may receive as part of the deal. They say 17 nothing about Uber Freight’s security practices, carrier vetting standards, or identity 18 verification procedures. See id. at §§ 1.1, 2.1. Inferring such obligations from these 19 sections would require the Court to read into the Agreement certain duties that the 20 Agreement omits and in fact affirmatively disclaims. 21 The Agreement’s disclaimers of any such obligations are unambiguous. Section 6 22 states that Uber Freight “does not assume any liability or financial responsibility for 23 property or cargo, including any loss, theft, damage or delayed delivery thereof.” Id. § 6. 24 Instead, it is the motor carrier, and not Uber Freight, that bears responsibility for cargo 25 loss. Id. Section 7.3 provides that the Uber Freight platform and services are provided “as 26 is,” without warranty, and expressly disclaims any warranty that the platform will be 27 uninterrupted or error free. Id. at § 7.3. These provisions are not ambiguous and do not 1 foreclose any such obligations. 2 Under Delaware law, the express terms of a fully integrated contract govern, and 3 courts will not imply obligations that contradict the written agreement. See Riverbend 4 Community, LLC v. Green Stone Engineering, LLC, 55 A.3d 330, 334 (Del. 2012) 5 (“When we interpret contracts, we ‘give priority to the parties’ intentions as reflected in 6 the four corners of the agreement.’”). The Agreements’ integration clause reinforces this 7 conclusion. Section 10.2 provides that the Agreement “constitutes the entire agreement 8 between the parties with respect to the subject matter hereof and supersedes all other 9 agreements and understandings, both written and oral, between the parties with respect to 10 the subject matter hereof.” FAC, Ex. A at § 10.2. The FAC relies extensively on 11 extracontractual representations allegedly understood by EFL to apply to Uber Freight, but 12 those representations are superseded by the terms of the Agreement and cannot form the 13 basis of a successful breach of contract claim under the circumstances presented here. 14 Accordingly, EFL’s breach of contract claim is DISMISSED. 15 2. Negligence and Gross Negligence Claims (Second and Third Causes of Action) 16 Even setting aside FAAAA preemption, EFL’s negligence and/or gross negligence 17 claims fail under the economic loss rule. Under Delaware law, the economic loss rule 18 generally prevents recovery in tort when a plaintiff suffers only economic loss in 19 connection with a contract. See Byborg Enters. S.A. v. Vertex, Inc., 2025 WL 1911338, at 20 *4–5 (Del Super. Ct. July 11, 2025). For a tort claim to survive along a contract claim, the 21 plaintiff must allege that the defendant breached “a duty independent of the contract.” Id. 22 at 4. “The mere fact that a tort claim uses different language or invokes a different theory 23 does not suffice if the duty allegedly breached is ultimately one created by contract.” Id. 24 EFL’s negligence claims are a restatement of its breach of contract theory. The 25 FAC alleges that Uber Freight owed EFL a duty of care to “exercise reasonable care in 26 arranging for the transport” of cargo and to take “reasonable steps to ensure that goods 27 shipped remained safe and not subject to loss or damage.” FAC ¶¶ 68–70. These claims 1 materially overlap with the breach of contract claim: “This agreement required Defendant 2 Uber Freight to take reasonable steps to ensure that logistical requirements and 3 specifications, including but not limited to ensuring or taking reasonable steps to ensure 4 that the appropriate, authorized, legitimate carrier picked up the goods for transportation.” 5 Id. ¶ 59. The FAC does not identify any duty independent of the Agreement. Under 6 Delaware law, such a re-labeling of claims is insufficient.3 Byborg, 2025 WL 1911338, at 7 *4–5. 8 Accordingly, the Court DISMISSES EFL’s second and third causes of action. 9 3. Implied Covenant of Good Faith and Fair Dealing Claim (Fifth Cause of Action) 10 EFL’s fifth cause of action for breach of the implied covenant of good faith and fair 11 dealing fails for reasons independent from the FAAAA preemption issue. Namely, the 12 claim does not identify a discrete contractual gap for the implied covenant to fill, and the 13 claim is duplicative of the breach of contract claim. 14 Under Delaware law, the implied covenant “attaches to every contract by operation 15 of law.” Pacira Biosciences, Inc. v. Fortis Advisors LLC, 2021 WL 4949179, at *12 (Del. 16 Ch. Oct. 25, 2021). But the doctrine is limited: it “should only operate . . . where the 17 contract as a whole speaks sufficiently to suggest an obligation and point to a result, but 18 does not speak directly enough to provide an explicit answer.” Dawson v. Pittco Capital 19 Partners, L.P., 2012 WL 1564805, at *25 (Del. Ch. Apr. 30, 2012). Thus, the implied 20 covenant is a gap-filling tool, not a mechanism for imposing obligations the parties did not 21 include in their agreement. See Nemec v. Shrader, 991 A.2d 1120, 1125 (Del. 2010). 22

23 3 EFL’s gross negligence claim also fails for an independent reason: the FAC does not plead 24 sufficient facts to sustain it. Under Delaware law, gross negligence requires an “extreme departure” from the ordinary standard of care, but the FAC alleges the same conduct underlying 25 both the negligence and gross negligence claims, with no additional facts alleged to support the gross negligence theory. See FAC ¶¶ 67–97. EFL points to two factual allegations that it 26 contends elevate the conduct to gross negligence – the insider theft and data breach, and Uber’s alleged failure to implement corrective measures after the first theft. Opp’n at 13. Neither is 27 sufficient, because the insider theft and data breach allegations consist of bare assertions devoid of factual backing, and the failure of Uber Freight to improve its practices after the first theft, while 1 Here, the Agreement is not silent on the subject matter of cargo theft. Cargo loss 2 and theft are expressly addressed in sections 6 and 8.1 of the Agreement. Section 6 3 allocates responsibility for cargo loss to the motor carrier and disclaims any liability by 4 Uber Freight. FAC, Ex. A at §6. Section 8.1 caps damages at $20,000. Id. at § 8.1. 5 These provisions make an express representation about who bears the risk of cargo loss, 6 and the implied covenant cannot be used to undo these representations. 7 The implied covenant claim also fails because it is wholly duplicative of the breach 8 of contract claim. Under Delaware law, a plaintiff “cannot assert a claim for breach of the 9 implied covenant of good faith and fair dealing that is based on exactly the same acts 10 which are said to be in breach of express covenants.” Mosiman v. Madison Cos., LLC, 11 2019 WL 203126, at *3 (D. Del. Jan. 15, 2019). Under the contract claim, EFL alleges 12 that Uber Freight “materially breached its contractual obligations” by “failing to ensure or 13 take reasonable steps to ensure that its online vendor system was secure” and by failing to 14 “vet the vendors, carriers and third parties who had access to its system.” FAC ¶ 61. As 15 part of the implied covenant claim, EFL alleges that Uber Freight breached the implied 16 covenant “by failing to implement and maintain safeguards . . . in its carrier platform to 17 prevent fraud, theft, and impersonation of legitimate carriers” and by “failing to properly 18 vet and monitor carriers, vendors, and agents.” FAC ¶ 108. The allegations are materially 19 identical. EFL responds that its implied covenant claim addresses contractual “gaps” that 20 Uber Freight failed to fill in good faith, but this characterization is at odds with the FAC 21 itself which frames the implied covenant claim as arising from the same acts and omissions 22 as the breach of contract claim. 23 Accordingly, the Court DISMISSES EFL’s fifth cause of action. 24 D. Leave to Amend 25 The Supreme Court has granted certiorari in Montgomery v. Caribe Transport II, 26 LLC, 124 F.4th 1053 (7th Cir. 2025), cert. granted (Oct. 3, 2025). That case directly 27 implicates the scope of FAAAA preemption and the validity of the safety exception 1 || decision is expected in June 2026. Because FAAAA preemption is the primary basis for 2 || dismissal of EFL’s second, third, and fifth causes of action, and because the governing 3 || preemption framework may materially shift, dismissal with prejudice on preemption 4 || grounds would be premature. 5 Accordingly, the Court DISMISSES WITH LEAVE TO AMEND. EFL may file 6 || asecond amended complaint within thirty days of the Supreme Court’s decision in 7 || Montgomery. However, 1f EFL chooses to do so, it must provide a viable factual and legal 8 || basis for claims not otherwise barred by the Court’s independent state and federal law 9 || analysis. Any amended complaint must avoid re-alleging claims and theories rejected by 10 || the Court on independent, non-FAAAA grounds. Those identified deficiencies are not 11 || remedied by a change in preemption law. 12 IT IS SO ORDERED. 13 Dated: March 31, 2026 — 5 _———_ 5 ARLES R. BREYER 14 United States District Judge 15

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