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Aig Europe Limited v. General System, Inc.

United States District Court, Fourth Circuit

December 16, 2013

AIG EUROPE LIMITED, Plaintiff,
v.
GENERAL SYSTEM, INC., et al., Defendants.

MEMORANDUM OPINION

RICHARD D. BENNETT, District Judge.

Presently pending before this Court is Third-Party Defendant TBB Global Logistics, Inc.'s Motion to Dismiss Counts I and II of Defendant and Third-Party Plaintiff General System Inc.'s Third-Party Complaint (ECF No. 18). The parties' submissions have been reviewed and no hearing is necessary. See Local Rule 105.6 (D. Md. 2011). For the reasons that follow, Third Party Defendant TBB Global Logistics, Inc.'s Motion to Dismiss Counts I and II of Defendant and Third-Party Plaintiff General System Inc.'s Third-Party Complaint (ECF No. 18) is GRANTED.

BACKGROUND

This Court accepts as true the facts alleged in the third-party complaint. See Aziz v. Alcolac, Inc., 658 F.3d 388, 390 (4th Cir. 2011).This action began when Plaintiff AIG Europe Limited ("AIG Europe"), as subrogee of Actavis Elizabeth, LLC ("Actavis"), [1] brought suit against Defendant and Third-Party Plaintiff General System, Inc. ("General System") under the Carmack Amendment to the Interstate Commerce Act ("Carmack Amendment"), [2] 49 U.S.C. § 14706, for General System's alleged loss of a tractor trailer filled with pharmaceuticals. Subsequently, General System filed a Third-Party Complaint against Third Party Defendants TBB Global Logistics ("TBB Global"), National Insurance Agency, Inc. ("National"), and Marine MGA, Inc. ("Marine MGA") asserting breach of contract and negligence claims. As only TBB Global has moved to dismiss the Third-Party Complaint, the Court's summary of the facts is limited to those factual allegations pertaining to TBB Global.

Specifically, General System alleges that TBB Global, a transportation brokerage service, arranged for General System to transport shipments for TBB Global's clients. Third Party Compl. ¶¶ 9-11, ECF No. 12. General System obtained insurance for its cargo, with a limit of $100, 000 per occurrence, and alleges that TBB Global "agreed" to refrain from arranging transportation of any shipment exceeding that insurance coverage. Id. ¶¶ 12, 14.

On October 11, 2011, TBB Global instructed General System to pick up a shipment of pharmaceuticals from Actavis Elizabeth, LLC ("Actavis") and deliver it to UPS in Louisville, Kentucky. Id. ¶ 15. TBB Global did not inform General System that the value of the shipment exceeded the $100, 000 limit of General System's insurance coverage or that the shipment contained controlled substances. Id. ¶¶ 16-17. A driver for General System picked up the shipment that same day. Id. ¶ 18. In route, the driver stopped at a truck stop to purchase cigarettes around 11 p.m. Id. ¶ 19. When he emerged from the store, both the truck and trailer were gone. Id. The truck was eventually located, but the goods had been removed from the trailer and were not recovered. Id. ¶ 20. Actavis made a claim against its insurance carrier, AIG Europe, for the loss of the goods, and one of the terms for payment of the claim was that Actavis subrogated its rights to AIG Europe. Id. ¶ 21.

After settlement of Actavis' claim, AIG Europe filed the pending action in this Court on January 22, 2013 against General System. See generally Pl.'s Compl., ECF No. 1. Subsequently, General System sought leave to file a third party complaint. See Mot. Leave File Third Party Compl., ECF No. 10. On June 26, 2013, this Court granted the Motion, and Global System's Third Party Complaint (ECF No. 12) against TBB Global and the other third-party defendants was filed that same day.[3] TBB Global moved to dismiss the Third Party Complaint for improper impleader, failure to state a claim, and improper venue. See generally Third Party Def. TBB Global's Mot. Dismiss Counts I and II (hereinafter, "TBB's Mot. Dismiss"), ECF No. 18. The other Third-Party Defendants did not join the Motion and have answered the Third-Party Complaint.[4]

STANDARD OF REVIEW

Rule 14(a) of the Federal Rules of Civil Procedure governs the process by which a defendant may assert claims against parties not yet joined to the action. Specifically, Rule 14(a)(1) states that:

A defending party may, as third-party plaintiff, serve a summons and complaint on a nonparty who is or may be liable to it for all or part of the claim against it. But the third-party plaintiff must, by motion, obtain the court's leave if it files the third-party complaint more than 14 days after serving its original answer.

FED. R. CIV. P. 14(a)(1). When a third-party claim has been improperly brought, "[a]ny party may move to strike [it]."[5] FED. R. CIV. P. 14(a)(4).

ANALYSIS

Under Rule 14(a) of the Federal Rules of Civil Procedure, a defendant may, as a third-party plaintiff, bring suit against "a nonparty who is or may be liable to it for all or part of the claim against it." Fed.R.Civ.P. 14(a)(1). In order to implead a third party under Rule 14(a), this Court has previously held that the third-party plaintiff's claim must be "derivative" of the plaintiff's claim. L'Occitane, Inc. v. Tran Source Logistics, Inc., No. WMN-09-cv-2499, 2010 WL 761201, at *3 (D. Md. March 2, 2010) (quoting Watergate Landmark Condominium Unit Owners' Assoc. v. Wiss, Janey, Elstner Assoc., 117 F.R.D. 576, 578 (E.D. Va. 1987)). Such derivative liability usually arises in cases involving indemnification, joint tortfeasors, or contribution. See id. ("Typically, proper third party claims involve one joint tortfeasor impleading another, an indemnitee impleading an indemnitor, or a secondarily liable party impleading one who is primarily liable'" (quoting Watergate, 117 F.R.D. at 578)); see also 6 Charles A. Wright & Arthur R. Miller, Federal Practice and Procedure § 1446 (3d ed.) ("The secondary or derivative liability notion is central and thus impleader has been successfully utilized when the basis of the third-party claim is indemnity, subrogation, contribution, express or implied warranty, or some other theory." (footnotes omitted)). Related claims- even those arising out of the same transaction or occurrence-do not automatically satisfy the derivative requirement. Id. at *4. In addition, a third-party complaint is not appropriate where a defendant merely attempts to deflect blame onto another party:

[A] third party claim is not appropriate where the defendant and putative third party plaintiff say, in effect, "It was him, not me." Such a claim is viable only where a proposed third party plaintiff says, in effect, "If I am liable to plaintiff, then my liability is only technical or secondary or partial, and the third party defendant is derivatively liable and must ...

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