Lexington Insurance v. Daybreak Express, Inc.
This text of 391 F. Supp. 2d 538 (Lexington Insurance v. Daybreak Express, Inc.) is published on Counsel Stack Legal Research, covering District Court, S.D. Texas primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.
Opinion
MEMORANDUM OPINION AND ORDER
Pending before the court is Plaintiff, Lexington Insurance Company, As Subro-gee of Burr Computer Environments, Inc.’s Motion for Remand (Docket Entry No. 6). For the reasons discussed below, the court will grant the motion to remand.
I. Background
Plaintiff, Lexington Insurance Co., filed this suit in the 333rd Judicial District of Harris County, Texas. According to the original petition, defendant, Daybreak Express, Inc., agreed through an agent to pay Burr Computer Environments, Inc. $166,655 in order to settle claims for damage to “a load of sensitive electrical equipment” Daybreak had delivered to Burr. 1 Daybreak, however, “subsequently refused to fund the settlement.” 2 Lexington, which reimbursed Burr for its losses and became its subrogee, asserts a breach of contract claim based on Daybreak’s failure to honor the settlement agreement. 3 Lexington has not alleged any other cause of action.
On March 15, 2005, Daybreak filed a notice of removal. Daybreak argues that this court has jurisdiction over the case because “it is a civil action pending in the State Court against a common carrier to recover damages for alleged delay, loss or injury to a shipment arising under” federal statute. 4
II. Standard of Review
28 U.S.C. § 1447(c) provides two grounds for remand: (1) a defect in removal procedure and (2) lack of subject matter jurisdiction. Cuellar v. Crown Life Ins. Co., 116 F.Supp.2d 821, 825 (S.D.Tex.2000). Lexington seeks remand on the grounds that this court lacks subject matter jurisdiction.
*540 The defendant may remove to federal court only state-court actions that originally could have been filed in federal court. Caterpillar Inc. v. Williams, 482 U.S. 386, 107 S.Ct. 2425, 2429, 96 L.Ed.2d 318 (1987). Absent diversity, removal is only appropriate for claims within the district courts’ federal question jurisdiction. 28 U.S.C. § 1331. Federal question jurisdiction extends to “all civil actions arising under the Constitution, laws, or treaties of the United States.” 28 U.S.C. § 1331. Generally, the presence or absence of federal-question jurisdiction is determined according to the “well-pleaded complaint rule,” which finds federal jurisdiction only when a federal question is presented on the face of the plaintiffs properly pleaded complaint. Caterpillar Inc., 107 S.Ct. at 2429. The “complete pre-emption” doctrine is an “independent corollary” to the well-pleaded complaint rule. Id. at 2430. It recognizes that a federal statute may have such preemptive force as to convert a claim purporting to be based on state law into one stating a federal claim for purposes of the well-pleaded complaint rule. Id.
When the jurisdiction of the court is challenged the party seeking to invoke federal jurisdiction has the burden of establishing the existence of subject matter jurisdiction. Estate of Martineau v. ARCO Chem. Co., 203 F.3d 904, 910 (5th Cir.2000). Removal jurisdiction “raises significant federalism concerns” and must therefore be strictly construed. Willy v. Coastal Corp., 855 F.2d 1160, 1164 (5th Cir.1988). Ambiguities or doubts are to be resolved against removal. Value Recovery Group, Inc. v. Hourani, 115 F.Supp.2d 761, 765 (S.D.Tex.2000).
III. Analysis
Daybreak concedes that a federal claim does not appear on the face of the original petition, but argues that federal jurisdiction is nevertheless proper under the complete preemption doctrine. 5 Daybreak cites Hoskins v. Bekins Van Lines, 343 F.3d 769 (5th Cir.2003), where the Fifth Circuit applied this doctrine to conclude that a plaintiffs state law claims against a common carrier for loss or damage to her personal property arose under federal law. 6 Id. at 771, 778. The court was persuaded that 49 U.S.C. § 14706—the Carmack Amendment to the federal Interstate Commerce Act—provides the exclusive cause of action for loss or damages to goods arising from the interstate transportation of those goods by a common carrier. Id. at 778. Daybreak suggests that this case falls squarely under Hoskins. 7
Daybreak’s reliance on Hoskins is misplaced. As the Hoskins court recognized, the Carmack Amendment’s preemptive effect derives from Congress’s purpose in enacting it: to provide a uniform, national remedy against common carriers, which were
being subjected to such a diversity of legislative and judicial holding that it was practically impossible for a shipper engaged in a business that extended beyond the confines of his own State, or for a carrier whose lines were extensive, to know, without considerable investigation and trouble, and even then oftentimes with but little certainty, what would be the carrier’s actual responsibility as to goods delivered to it for transportation from one State to another.
Id. at 776 (quoting Adams Express Co. v. Croninger, 226 U.S. 491, 33 S.Ct. 148, 57 *541 L.Ed. 314 (1913)). The Carmack Amendment therefore supersedes the “special regulations and policies of particular States upon the subject of the carrier’s liability for loss or damage to interstate shipments.” Id. at 777 (quoting Missouri, K. & T.R. Co. of Tex. v. Harris, 234 U.S. 412, 34 S.Ct. 790, 58 L.Ed. 1377 (1914)). The Hoskins plaintiffs state-law claims were properly construed as arising under the Carmack Amendment because the plaintiff sought to hold her carrier responsible for damage incurred in the shipment of property from Texas to Virginia.
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Cite This Page — Counsel Stack
391 F. Supp. 2d 538, 2005 U.S. Dist. LEXIS 34762, 2005 WL 1515397, Counsel Stack Legal Research, https://law.counselstack.com/opinion/lexington-insurance-v-daybreak-express-inc-txsd-2005.