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CSX Transportation Co. v. Novolog Bucks County

December 14, 2009

CSX TRANSPORTATION CO.
v.
NOVOLOG BUCKS COUNTY



The opinion of the court was delivered by: O'neill, J.

MEMORANDUM

On October 8, 2009, plaintiff CSX Transportation Co. moved for partial summary judgment on its claims against defendant Novolog Bucks County for certain demurrage charges. Novolog moved to strike CSX's motion on October 16, 2009, and on October 28, 2009 filed a response in opposition to CSX's motion. CSX filed a reply to Novolog's response in opposition on November 16, 2009, which by Order dated November 2, 2009, will also be considered CSX's opposition to Novolog's motion to strike. The issues raised in the motions now are briefed fully and ripe for decision. For the reasons set forth below I will deny CSX's motion for partial summary judgment and deny Novolog's motion to strike.

BACKGROUND*fn1

Many of the underlying facts giving rise to this dispute are set forth in this Court's opinion on the parties' cross motions for summary judgment, CSX Transp. Co. v. Novolog Bucks County, 2006 WL 1451280, at *1-4 (E.D. Pa. May 24, 2006) ("CSX I"), the Court of Appeals' opinion vacating portions of that opinion and Order and remanding the case, CSX Transp. Co. v. Novolog Bucks County, 502 F.3d 247, 250-52 (3d Cir. 2007) ("CSX II"), as well as this Court's opinion denying Novolog's motion for summary judgment following remand, CSX Transp. Co. v. Novolog Bucks County, 2008 WL 4613862 (E.D. Pa. Oct. 16, 2008) ("CSX III").

A. Factual Background

CSX is a rail common carrier. Novolog is a private port with access to a rail-served industrial facility on the Delaware River which during the relevant period served as a transfer point for the import, export and domestic transportation of steel. CSX received and followed directions from steel companies to deliver railcars loaded with steel to the Novolog port. Novolog received the railcars from CSX and then unloaded and transferred the steel onto other means of transportation. Sometimes Novolog ordered empty railcars from CSX to be placed at Novolog's port for loading with imported steel and transporting to domestic destinations.*fn2

Novolog did not have an ownership interest in any of the shipments at issue here, but rather received and forwarded cargo on behalf of others and on their instructions.

CSX's tariff requires a person who receives its railcars for unloading or who orders empty railcars for loading to return those cars to service within two days. CSX assesses demurrage charges when the cars are kept beyond this time.

During the early part of 2003, due to fluctuations in the price of steel, there was a significant increase in the amount of steel delivered for export to the Novolog port. The influx prevented Novolog from loading and unloading certain railcars within the two-day time frame. CSX charged Novolog demurrage fees totaling $260,304 as of August, 2003. Novolog refused to pay and CSX brought this action.

B. Procedural History

CSX filed a complaint on August 24, 2004 and an amended complaint on November 18, 2004 against Novolog for demurrage charges assessed pursuant to 49 U.S.C. § 10746, the related rules promulgated by the U.S. Surface Transportation Board and CSX Tariff 8100 for failure to release CSX's railcars in a timely manner. CSX's amended complaint seeks $260,304 in demurrage charges plus interest and attorneys fees, claiming Novolog owes $214,632 in unloading demurrage charges and $45,672 in loading demurrage charges. Novolog filed its answer and counterclaim on November 21, 2004 and amended answer and counterclaim on December 15, 2004. Novolog prevailed on its counterclaim at trial and that has no relevance to the issues before me now.

After discovery, the parties filed cross-motions for summary judgment. On May 24, 2006, I denied both parties' summary judgment motions regarding the demurrage dispute. CSX I, 2006 WL 1451280, at *18. I did not decide the evidentiary issues or make a finding of fact as to whether Novolog was named as the consignee or as the shipper in the bills of lading. Id. at *3 n.3-5, *4 n.6. I held that summary judgment was inappropriate because there remained an issue of material fact as to whether Novolog had entered into a separate contractual agreement with CSX that might make it liable for the charges. Subsequently, CSX filed an admission that "other than Novolog being the named consignee on bills of lading, and Novolog having accepted delivery of the loaded cars by CSX, CSX had no separate contractual relationship with Novolog governing the movement and/or disposition of the detained rail cars." I then entered judgment as a matter of law in favor of Novolog on July 12, 2006.

On appeal by CSX, the Court of Appeals held in relevant part:

We hold that the consignee-agent provision of the Interstate Commerce Commission Termination Act, 49 U.S.C. § 10743(a)(1), governs this dispute as to the charges assessed against Novolog as the consignee of freight. Under this provision a transloader or other such entity, if named on the bill of lading as the sole consignee, is presumptively liable for demurrage charges arising from unloading delays, unless it accepts the freight as the agent of another and notifies the carrier of its status in writing prior to delivery. Because the factual record was not sufficiently developed, however, we cannot determine what the bills of lading showed here; thus we vacate the District Court's order granting judgment to the transloader as a matter of law and remand for further proceedings.

With respect to the transloader's potential liability for demurrage charges in its role as the shipper (consignor) of freight, we refrain from announcing a holding because the question was not fully addressed or briefed, but we will vacate the District Court's grant of judgment on this claim as well and remand it for further consideration in light of our holding regarding consignee liability.

CSX II, 502 F.3d at 250.

Following remand, Novolog moved for summary judgment against CSX. Novolog had three primary arguments. First, it argued CSX had not produced any evidence of the actual bills of lading at issue. I held that the waybills and testimony of John Underwood are not hearsay and denied Novolog's motion based on the admissibility of CSX's evidence. CSX III, 2008 WL 4613862, at *4-5. Second, Novolog claimed CSX could not provide any evidence that the waybills correspond to the demurrage charges on CSX's Original Incidental Bills. I held that a genuine issue of material fact existed because CSX was able to demonstrate with respect to a few waybills and OIBs that the railcar numbers linked the two documents. Id. at *7. Finally, Novolog claimed that CSX received written notification of Novolog's agency status thereby permitting Novolog to avoid liability for loading demurrage charges. I held that CSX demonstrated a genuine issue of material fact existed as to whether Novolog provided notice of its agency status at the time of the order or prior to shipment. Id. at *8.

STANDARD OF REVIEW

Rule 56(c) of the Federal Rules of Civil Procedure provides that summary judgment is proper "if the pleadings, the discovery and disclosure materials on file, and any affidavits show that there is no genuine issue as to any material fact and that the movant is entitled to judgment as a matter of law." An issue of material fact is genuine if "the evidence is such that a reasonable jury could return a verdict for the nonmoving party." Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 255 (1986). Summary judgment will be granted "against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial." Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986). The party moving for summary judgment has the burden of demonstrating that there are no genuine issues of material fact. Id. at 322-23. If the moving party sustains the burden, the nonmoving party must set forth facts demonstrating the existence of a genuine issue for trial. See Anderson, 477 U.S. at 255.

When a properly supported motion for summary judgment is made, "an adverse party may not rest upon the mere allegations or denials of the adverse party's pleading, but the adverse party's response, by affidavits or as otherwise provided in this rule, must set forth specific facts showing that there is a genuine issue for trial." Fed. R. Civ. P. 56(e). The adverse party must raise "more than a mere scintilla of evidence in its favor" in order to overcome a summary judgment motion and cannot survive by relying on unsupported assertions, conclusory allegations, or mere suspicions. Williams v. Borough of W. Chester, 891 F.2d 458, 460 (3d Cir. 1989). However, the "existence of disputed issues of material fact should be ascertained by resolving all inferences, doubts and issues of credibility against" the moving party. Ely v. Hall's Motor Transit Co., 590 F.2d 62, 66 (3d Cir. 1978), citations and quotation marks omitted.

DISCUSSION

I. Preliminary Matters

A. Defendant's Motion to Strike Plaintiff's Motion for Partial Summary Judgment

Novolog moves to strike CSX's motion for partial summary judgment arguing it was untimely filed. Novolog notes that by Order of December 13, 2005, the parties had until January 6, 2006 to file dispositive motions and that CSX filed a motion for summary judgment on that date. Furthermore, my Order of August 12, 2009, which followed the Court of Appeals' remand, listed the trial date as November 2, 2009 and instructed the parties to file amended pretrial memoranda and points for charge on or before October 16, 2009; it did not provide for the filing of dispositive motions.

I will consider CSX's motion even though it was filed well after the original scheduling Order's cut-off date and the Order of August 12 does not provide for filing dispositive motions. Federal Rule of Civil Procedure 16(b)(3)(A) directs that "[t]he scheduling order must limit the time to . . . file motions," but also provides that the scheduling order may be modified for "good cause and with the judge's consent." Fed. R. Civ. P. 16(b)(4). I find good cause to consider CSX's motion for three reasons. First, consideration of the motion will help expedite the disposition of this action and narrow the issues for trial. See Brooks v. Cook , No. 92-56232, 1994 WL 232272, at *1 (9th Cir. May 31, 1994); Spiller v. Ella Smithers Geriatric Center, 919 F.2d 339, 343 (5th Cir. 1990).Second, Novolog filed a motion for summary judgment after remand despite the fact that the ...


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