Sompo Japan Insurance v. Norfolk Southern Railway Co.

966 F. Supp. 2d 270, 2013 WL 4414797
CourtDistrict Court, S.D. New York
DecidedAugust 16, 2013
DocketNos. 07 Civ. 2735(DC), 07 Civ. 10498(DC)
StatusPublished
Cited by5 cases

This text of 966 F. Supp. 2d 270 (Sompo Japan Insurance v. Norfolk Southern Railway Co.) 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
Sompo Japan Insurance v. Norfolk Southern Railway Co., 966 F. Supp. 2d 270, 2013 WL 4414797 (S.D.N.Y. 2013).

Opinion

OPINION

CHIN, Circuit Judge.

Plaintiffs Sompo Japan Insurance Company of America and Sompo Japan Insurance, Incorporated (together, “Sompo”) and Nipponkoa Insurance Company Limited (“Nipponkoa”) insured cargos that were being transported on a train that derailed in Texas in 2006. Defendants Norfolk Southern Railway Company (“NSR”), Norfolk Southern Corporation, and Kansas City Southern Railway Company operated the derailed train and the track on which it ran.

Sompo and Nipponkoa sued defendants, asserting claims under federal statutory and common law. Following extensive earlier proceedings, I issued an opinion on September 4, 2012, granting in part and [273]*273denying in part defendants’ motions for summary judgment and denying plaintiffs’ cross-motions. Sompo Japan Ins. Co. of Am. v. Norfolk S. Ry. Co., 891 F.Supp.2d 489 (S.D.N.Y.2012). Thereafter, the parties filed cross-motions for reconsideration and renewed their cross-motions for summary judgment. For the reasons set forth below, the parties’ respective motions are granted in part and denied in part.

BACKGROUND

The relevant facts and procedural history are described in detail in my previous opinions,1 and I repeat them here only to the extent necessary for an understanding of the issues now before the Court. The facts are undisputed, except as to those relating to plaintiffs’ claim regarding the Enplas shipment, which are presented in the light most favorable to defendants, with all reasonable inferences drawn in their favor. See Gary Friedrich Enters., LLC v. Marvel Characters, Inc., 716 F.3d 302, 308 (2d Cir.2013).

A. Facts

1. Sompo-Insured Cargos

Sompo insured various cargos shipped by Kubota Tractor Corporation (“Kubota”), Hoshizaki Electric Company (“Hoshizaki”), Canon, Incorporated (“Canon”), and Unisia of Georgia Corporation (“Unisia”), each acting as consignee for Hitachi, Limited (“Hitachi”). Sompo, 891 F.Supp.2d at 492. In March 2006, these companies each arranged for their respective cargo to be transported first by ship from several points in Japan and China to California, and then by train from California to Georgia. Id. at 492-93.

Kubota, Hoshizaki, and Canon, each directly or through an intermediary, hired Yang Ming Marine Transport Corporation (‘Yang Ming”), an ocean carrier, to carry the cargos for the sea leg of the trip. Hitachi, through its consignee Unisia, contracted Nippon Express U.S.A. (Illinois) (“Nippon Express”) to provide the transportation. Id. at 493. Nippon Express is a non-vessel operating common carrier (“NVOCC”), an entity that arranges transportation for hire and assumes liability for the goods being transported but does not undertake actual transportation of the goods. Id. at 493 n. 4 (citing Royal & Sun Alliance Ins., PLC v. Ocean World Lines, Inc., 612 F.3d 138, 140 n. 2 (2d Cir.2010) (citation omitted)). Nippon Express issued to Hitachi/Unisia a bill of lading, id., which is a document that records a carrier’s receipt of goods from the shipper, states the terms of carriage, and evinces a contract for carriage, Norfolk S. Ry. Co. v. Kirby, 543 U.S. 14, 18-19, 125 S.Ct. 385, 160 L.Ed.2d 283 (2004) (citations omitted). Nippon Express in turn engaged Yang Ming to carry the cargos for the sea leg of the trip. Sompo, 891 F.Supp.2d at 493.

Yang Ming issued to each of its customers sea waybills, Sompo Japan Ins. Co. of Am. v. Norfolk S. Ry. Co., 540 F.Supp.2d 486, 489 (S.D.N.Y.2008), which are like bills of lading with differences not relevant here, see Delphi-Delco Elecs. Sys. v. M/V Nedlloyd Europa, 324 F.Supp.2d 403, 424-25 (S.D.N.Y.2004). Yang Ming delivered [274]*274the cargos to California, where they were transported to Dallas, Texas, on rail lines owned and operated by Burlington Northern Santa Fe Railway Company. Sompo, 891 F.Supp.2d at 498. In Dallas, the car-gos were transferred to NSR for the final leg of inland carriage to Georgia. Id The train operated by defendants derailed near Dallas, Texas on April 18, 2006, resulting in damage to the cargos on board. Id at 492.

2. Nipponkoa-Insured Cargos

Nipponkoa insured cargos shipped by Enplas Corporation (“Enplas”) and Fuji OOZX Incorporated (“Fuji”). Id. at 493. Enplas and Fuji each hired Nippon Express to transport their respective cargos, which were transported in the same manner as that of the Sompo-insured Unisia shipment and damaged in the same train derailment. Id. at 492-94.

3. Enplas Assignment

Following the train accident, Enplas, its cargo underwriter Tokio Marine Claims Services, Incorporated (“Tokio Marine”), Nippon Express, its insurer Nipponkoa, Yang Ming, and NSR settled their various claims against one another. In exchange for $147,717, Enplas assigned its right to make claims against the carriers to Tokio Marine, acting through its claim servicer TM Claim Service, Incorporated (“TM Claim Service”). (Ex. R to Decl. of Thomas M. Eagan in Opp’n to Defs.’ Mot. for Summ. J., Aug. 12, 2011 (“Eagan 8-12-2011 Deck”)). TM Claim Service assigned its rights in the Enplas claim to Nipponkoa, acting through W.K. Webster (Overseas) Limited (“W.K. Webster”), in exchange for $100,000. (Id. Exs. I, J). Nipponkoa/W.K. Webster also received an assignment from Yang Ming of any rights it might have in the Enplas claim, in consideration of W.K. Webster’s agreement to indemnify Yang Ming. (See Ex. V to Pis.’ Reply Mem. of Law in Further Supp. of Their Mots, for Summ. J. and in Further Opp’n to Defs.’ Mots, for Summ. J. and Recons., Nov. 21, 2012 (“Pis.’ 11-21-2012 Reply Mem. of Law”); see also Exs. A, B to Deck of Charles L. Howard in Supp. of Defs.’ Combined Resp. to Pis.’ Mot. for Recons., Nov. 7, 2012 (“Howard 11-7-2012 Deck”)). Nipponkoa/W.K. Webster attempted but ultimately failed to reach a settlement with NSR. (See Eagan 8-12-2011 Deck Ex. N).

NSR had been hired by Yang Ming as the inland rail carrier pursuant to the Intermodal Transportation Agreement (“ITA”) between them. (See Ex. 14 to Deck of Charles L. Howard in Supp. of Defs.’ Mot. for Summ. J., June 29, 2011 (“Howard 6-29-2011 Deck”)). The ITA incorporated by reference the terms of NSR’s Intermodal Transportation Rules Circular N,o. 2 (“Rules Circular”). Sompo, 891 F.Supp.2d at 499.

Section 12(B)(1) of the ITA provided:

[NSR] will be liable for and will hold Yangming harmless against loss of or damage to freight in containers transported at the rates and charges provided in this Agreement ... only to the extent that the sole proximate cause of said loss or damage is a railroad accident, derailment, or collision between railroad equipment negligently caused by [NSR]. [NSR’s] liability for freight loss and damage will be subject to the dollar limitation set forth in the Rules Circular

(Howard 6-29-2011 Decl. Ex. 14).

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966 F. Supp. 2d 270, 2013 WL 4414797, Counsel Stack Legal Research, https://law.counselstack.com/opinion/sompo-japan-insurance-v-norfolk-southern-railway-co-nysd-2013.