Searching over 5,500,000 cases.


searching
Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.

Gaines Motor Lines, Inc. v. Klaussner Furniture Industries, Inc.

United States Court of Appeals, Fourth Circuit

October 30, 2013

GAINES MOTOR LINES, INC.; B.A.H. Express, Inc.; Freightmaster, Inc.; David Phillips Trucking Co.; H.G. Smith Company, Inc.; Triangle Transport and Distribution Services, LLC; Graham Trucking Enterprises, Inc.; Big Ben Trucking, LLC, Plaintiffs-Appellants,
v.
KLAUSSNER FURNITURE INDUSTRIES, INC., Defendant-Appellee, and Southland Transportation Company, Plaintiff, and Salem Logistics Traffic Services, LLC; Salem Logistics, Inc., Defendants.

Argued: Sept. 18, 2013.

Page 297

[Copyrighted Material Omitted]

Page 298

ARGUED:

Robert D. Moseley, Jr., Smith Moore Leatherwood LLP, Greenville, South Carolina, for Appellants.

James Aaron Dean, Womble Carlyle Sandridge & Rice, PLLC, Winston-Salem, North Carolina, for Appellee.

ON BRIEF:

C. Fredric Marcinak III, Smith Moore Leatherwood LLP, Greenville, South Carolina, Jon Berkelhammer, Smith Moore Leatherwood LLP, Greensboro, North Carolina, for Appellants.

Michael Montecalvo, Womble Carlyle Sandridge & Rice, PLLC, Winston-Salem, North Carolina, for Appellee.

Before SHEDD, DUNCAN, and KEENAN, Circuit Judges.

Vacated and remanded with instructions by published opinion.

Judge DUNCAN wrote the opinion, in which Judge SHEDD and Judge KEENAN joined.

Page 299

DUNCAN, Circuit Judge:

In this appeal, we address a question of first impression in this circuit: whether, absent a federal tariff, federal courts have subject matter jurisdiction over a motor carrier's breach of contract claim against a shipper for unpaid freight charges. For the reasons that follow, we find that the district court lacked jurisdiction to adjudicate this dispute, and we lack jurisdiction over this appeal. Accordingly, we vacate the district court's opinion and remand with instructions to dismiss.

I.

A.

Appellants are federally licensed motor carriers (" Motor Carriers" ) who transport goods in interstate commerce. Appellee, Klaussner Furniture Industries, Inc. (" Klaussner" ), is a furniture company headquartered in Asheboro, North Carolina. The parties, with the exception of Appellant Graham Trucking Enterprises, Inc., are incorporated under North Carolina law.

Prior to the summer of 2007, Klaussner contracted directly with the Motor Carriers to deliver its furniture to corporate customers, including furniture retailers and renters, both in and outside of North Carolina. The Motor Carriers would submit quoted rates directly to Klaussner who would then pick amongst the bids for each shipment.

Then, in August 2007, Klaussner contracted with a third-party broker, Salem Logistics Traffic Services, LLC (" Salem" ), to coordinate all shipping logistics. Salem charged Klaussner a uniform rate that was generally higher than the Motor Carriers' individual bids. In return, Salem promised to reduce costs and improve customer service by coordinating stops to multiple Klaussner customers for each scheduled shipment. Salem was expected to deduct its commission, and then pay the motor carriers.

Doyle Vaughn, a Klaussner employee, personally notified the Motor Carriers that they would begin working directly with Salem. Shortly thereafter, Salem hired Vaughn, who continued to work from the same desk at Klaussner. Vaughn notified the Motor Carriers of his change in employment.

The Motor Carriers also received a series of documents, several of which bore both Klaussner's and Salem's logos, explaining Salem's new role. Salem's Vice President of Logistics, Ralph Raymond, sent a letter explaining that Salem would manage all " freight payment responsibilities." J.A. 454. The Motor Carriers were sent a Fuel Surcharge Addendum, a Mutual Non-Disclosure Agreement, and instructions from Salem on submitting quotes. Finally, Klaussner's Vice President of Supply Chain, Chuck Miller, sent instructions to submit freight bills " designated as third party payment" to " Klaussner Furniture c/o Salem Logistics Inc." and then listed Salem's address. J.A. 461.

Each furniture delivery the Motor Carriers undertook required three documents: a Confirmation of Contract Carrier Verbal Rate Agreement (" Agreement" ); a Carrier Pickup and Delivery Schedule (" Schedule" ); and a bill of lading. The Agreement memorialized the rate agreed upon by Salem and the chosen motor carrier, and included the total freight charge for the load. A freight charge includes the agreed upon rate and standardized fees, such as a fuel charge. The Agreement was signed by the motor carrier and does not mention Klaussner. The Schedule listed the pick-up location as " Klaussner Furniture" and the destination address. Salem's address

Page 300

is listed under the " Bill-To & Contact Information" section.

The bills of lading executed by Klaussner and the Motor Carriers contained standardized provisions generally used in the trucking industry. Each bill of lading listed a motor carrier, a consignor, and a consignee. The party shipping the goods is the consignor. The party who receives the goods is the consignee. Here, Klaussner was the consignor, and Klaussner's customer was the consignee. The bills of lading contained the statement: " freight charges are prepaid unless marked otherwise," and three options: " Prepaid," " Collect," and " 3rd Party." [1] Most of the relevant bills of lading were marked " Prepaid."

The bills of lading contained an executed non-recourse provision that stated:

SUBJECT TO SECTION 7 OF CONDITIONS, IF THIS SHIPMENT IS TO BE DELIVERED TO THE CONSIGNEE WITHOUT RECOURSE ON THE CONSIGNOR, THE CONSIGNOR ...

Buy This Entire Record For $7.95

Download the entire decision to receive the complete text, official citation,
docket number, dissents and concurrences, and footnotes for this case.

Learn more about what you receive with purchase of this case.