Federal Insurance Company v. MSC Mediterranean Shipping Company S.A.

CourtDistrict Court, S.D. New York
DecidedMay 23, 2025
Docket1:23-cv-08870
StatusUnknown

This text of Federal Insurance Company v. MSC Mediterranean Shipping Company S.A. (Federal Insurance Company v. MSC Mediterranean Shipping Company S.A.) is published on Counsel Stack Legal Research, covering District Court, S.D. New York primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Federal Insurance Company v. MSC Mediterranean Shipping Company S.A., (S.D.N.Y. 2025).

Opinion

USDC SDNY DOCUMENT UNITED STATES DISTRICT COURT ELECTRONICALLY FILED SOUTHERN DISTRICT OF NEW YORK DOCH DATE FILED: 05/23/2025 Federal Insurance Company, Plaintiff, 1:23-cv-08870 (SDA) (consolidated -against- with 1:23-cv-11128 (SDA) and 1:24- cv-01902 (SDA)) MSC Mediterranean Shipping Company S.A., OPINION AND ORDER Defendant.

STEWART D. AARON, United States Magistrate Judge: Plaintiff Federal Insurance Company (hereinafter “Plaintiff” or “Federal”) sued Defendant MSC Mediterranean Shipping Company S.A. (“Defendant” or “MSC”) in three now-consolidated actions in this Court as subrogated cargo insurer having paid the insurance claim of Chatham Imports, Inc. (“Chatham”) for non-delivery, shortage and loss to certain liquor shipments carried by MSC. (See 1st Compl., 23-CV-08870 ECF No. 1, 141 2-3, 9; 2d Compl., 23-CV-11128 ECF No. 1, 4, 11-12; 3d Compl., 24-CV-01902 ECF No. 1, 94] 4, 9.*) In each of the three actions, one of the affirmative defenses raised by MSC is that, because the nature and valuation of the goods were not declared by the shippers before the shipment and inserted in the bill of lading, any recovery by Federal should be limited to $500 per “package” or “customary freight unit” in accordance with the Carriage of Goods by Sea Act (“COGSA”) and the relevant contracts of carriage. (Am. Answer, 23-CV-08870 ECF No. 19, 4 28; Answer, 23-CV-11128 ECF No. 13, 4] 60; Answer, 24-CV- 01902 ECF No. 9, 9 47.)

The plaintiff in the 3d Complaint initially had been named as Chatham but by stipulation Federal later was substituted as plaintiff. (8/7/24 Stip. & Order, 24-CV-01902 ECF No. 20.)

Pending before the Court is MSC’s motion, pursuant to Rule 56 of the Federal Rules of Civil Procedure, for partial summary judgment (based upon the foregoing affirmative defense) to establish that its liability in the consolidated actions is limited to a total of $30,000 (i.e., 60 pallets

times $500). (Def.’s 2/28/25 Not. of Mot., 23-CV-08870 ECF No. 48; see also Def.’s 2/28/25 Mem., 23-CV-08880 ECF No. 52, at 1.) For the reasons set forth below, Defendant’s motion is GRANTED. BACKGROUND FACTS2 Federal, the plaintiff in each of the consolidated lawsuits, is the subrogated cargo insurer which paid the insurance claims of Chatham. (Def.’s 56.1 ¶ 1; Pl.’s 56.1 ¶ 1.) Chatham was at all material times the ex-works3 purchaser, owner and intended consignee of the shipments of

mezcal liquor that are the subject of the lawsuits (the “Shipments”). (Id.) MSC, the defendant in each of the consolidated lawsuits, is a multimodal common carrier of cargo for hire, which contracted to transport the Shipments. (Def.’s 56.1 ¶ 2; Pl.’s 56.1 ¶ 2.) MSC contracted to provide multimodal carriage of the Shipments from Mexico City to New York by way of Veracruz. (Pl.’s 56.1 ¶ 3; Def.’s 56.1 ¶ 3.)

The contracts of carriage upon which Federal’s lawsuits are based are bills of lading and a seaway bill issued by MSC in connection with the Shipments, i.e., MSC Bill of Lading No. MEDUX5278304, MSC Bill of Lading No. MEDUX5326012 and MSC Sea Waybill No.

2 The facts set forth herein are drawn from the parties’ respective Local Civil Rule 56.1 Statements (Def.’s 56.1, ECF No. 49; Pl.’s 56.1, ECF No. 57), as well as documents filed by the parties as part of the summary judgment record. 3 “Ex-work is a term used by the International Chamber of Commerce, and indicates that ‘the seller delivers when it places the goods at the disposal of the buyer at the seller’s premises.’” Rosenshine v. A. Meshi Cosms. Indus. Ltd., No. 18-CV-03572 (LDH), 2020 WL 1914648, at *3 (E.D.N.Y. Mar. 30, 2020) (citation omitted). MEDUX5390844. (See 1st Compl., 23-CV-08870 ECF No. 1, ¶ 2); 2d Compl., 23-CV-11128 ECF No. 1, ¶ 11; 3d Compl., 24-CV-01902 ECF No. 1, ¶ 9.) MSC Bill of Lading No. MEDUX5278304 names Chatham as consignee and states in the

“Description of Packages and Goods” that “2016 CASE(S) OF MEZCAL, BOTTLES OF 750 ML” are being shipped and that the “TOTAL NUMBER OF PACKAGES” is “2,016.” (Ex. K to Azevedo Decl., 23-CV-08870 ECF No. 51-11, at PDF p. 2; see also Ex. G to Azevedo Decl., 23-CV-08870 ECF No. 51-7, at PDF p. 2 (draft).) The Bill of Lading states: “IN ACCEPTING THIS BILL OF LADING THE MERCHANT EXPRESSLY ACCEPTS AND AGREES TO ALL THE TERMS AND CONDITIONS, WHETHER

PRINTED, STAMPED OR OTHERWISE INCORPORATED ON THIS SIDE AND ON THE REVERSE SIDE OF THIS BILL OF LADING AND THE TERMS AND CONDITIONS OF THE CARRIER’S APPLICABLE TARIFF AS IF THEY WERE ALL SIGNED BY THE MERCHANT.” (Id.) At the top of the page, the document states in the English language, as well as other languages, “See website for large version of the reverse[,]” followed by the website citation “www.msc.com.” (Id.) Centered at the very bottom of the page appears the language in block capital letters: “TERMS CONTINUED ON

REVERSE[.]” (Id.) There is no “DECLARED VALUE” listed in the bill of lading. (See id.) In the box indicating the number of packages or containers received by MSC is listed “1 cntr[,]” signifying one container. (Id.; see also Azevedo Decl. ¶¶ 30-31.)4 MSC Bill of Lading No. MEDUX5326012 names Chatham as consignee and states in the “Description of Packages and Goods” that “2016 CASE(S) OF MEZCAL, BOTTLES OF 750 ML” are

4 The Court declines to strike or disregard the MSC declarations as requested by Plaintiff. (Pl’s 4/8/25 Opp. Mem. at 18-22.) The Court does not refer to the Werner Declaration and references the Azevedo Declaration only to the extent that it provides additional information about the Bills of Lading/Sea Waybills, which the Court finds is neither legal argument nor inadmissible hearsay. being shipped and that the “TOTAL NUMBER OF PACKAGES” is “2,016.” (Ex. G to Azevedo Decl. at PDF p. 3 (draft).5) The Bill of Lading states: “IN ACCEPTING THIS BILL OF LADING THE MERCHANT EXPRESSLY ACCEPTS AND AGREES TO ALL THE TERMS AND CONDITIONS, WHETHER

PRINTED, STAMPED OR OTHERWISE INCORPORATED ON THIS SIDE AND ON THE REVERSE SIDE OF THIS BILL OF LADING AND THE TERMS AND CONDITIONS OF THE CARRIER’S APPLICABLE TARIFF AS IF THEY WERE ALL SIGNED BY THE MERCHANT.” (Id.) At the top of the page, the document states in the English language, as well as other languages, “See website for large version of the reverse[,]” followed by the website citation “www.msc.com.” (Id.) Centered at the

very bottom of the page appears the language in block capital letters: “TERMS CONTINUED ON REVERSE[.]” (Id.) There is no “DECLARED VALUE” listed in the bill of lading. (See id.) In the box indicating the number of packages or containers received by MSC is listed “1 cntr[,]” signifying one container. (Id.) MSC Sea Waybill No. MEDUX5390844 names Chatham as consignee and states in the “Description of Packages and Goods” that “2016 CASE(S) OF MEZCAL” are being shipped and that

the “TOTAL NUMBER OF PACKAGES” is “2,016.” (Ex. K to Azevedo Decl. at PDF p. 3; see also Ex. G to Azevedo Decl. at PDF p. 4.) The Sea Waybill states: “IN ACCEPTING THIS SEA WAYBILL THE SHIPPER EXPRESSLY ACCEPTS AND AGREES TO, ON HIS OWN BEHALF AND ON BEHALF OF THE CONSIGNEE, THE OWNER OF GOODS AND THE MERCHANT, AND WARRANTS HE HAS AUTHORITY TO DO SO, ALL THE TERMS AND CONDITIONS WHETHER PRINTED, STAMPED OR OTHERWISE INCORPORATED ON THIS AND ON THE REVERSE SIDE AND TERMS AND CONDITIONS OF THE

5 Because the loss was discovered while the shipping container still was in the terminal, no final bill of lading ever was issued for this shipment. (See Azevedo Decl., ECF No.

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Federal Insurance Company v. MSC Mediterranean Shipping Company S.A., Counsel Stack Legal Research, https://law.counselstack.com/opinion/federal-insurance-company-v-msc-mediterranean-shipping-company-sa-nysd-2025.