United States District Court, W.D. Oklahoma
HEATON, CHIEF U.S. DISTRICT JUDGE
case arises out of plaintiff Mammoth Manufacturing,
Inc.'s efforts to deliver polyurethane hose to one of its
customers. According to the complaint, Mammoth Manufacturing
(“Mammoth”) orally contracted with defendant C.
H. Robinson Worldwide Inc. (“Robinson”) to
arrange the delivery of the hose from Mammoth's
warehouses in Oklahoma City and Chickasha to its customer in
Woodward, Oklahoma. While the hose was being transported by
the carrier arranged by Robinson, the carrier's trailer
overturned, allegedly resulting in damage to the hose such
that it was unuseable and unsaleable. The carrier apparently
lacked sufficient insurance to cover the claimed damages
based on the value of the hose, approximately $280, 000. In
any event, Mammoth has pursued claims against Robinson for
originally brought suit against Robinson and the carrier in
Oklahoma state court, asserting claims for negligence,
negligent supervision, and breach of contract. Robinson moved to
dismiss the negligence claims against it on the basis of
federal preemption, relying on 49 U.S.C. § 14501. The
state court granted the motion and dismissed the claims for
negligence and negligent supervision. Thereafter, in August
2015, plaintiff dismissed the state case altogether.
later, plaintiff filed this case against Robinson only. Here,
Mammoth reasserts a claim for breach of contract and also a
fraud claim. The fraud claim is based on several allegedly
false representations made by Robinson, either on its website
or through its personnel, leading up to the oral agreement.
has now moved to dismiss the fraud claim on the basis of
Fed.R.Civ.P. 12(b)(6), arguing that it is a
“broker” within the meaning of preemption
provisions of the Interstate Commerce Commission Termination
Act, 49 U.S.C. § 14501, and that plaintiff's fraud
claim is therefore preempted by federal law. It bases its
preemption argument both on issue preclusion, arguing that
the issue was already resolved against plaintiff in the state
court proceeding, and on the substantive reach of the
preemption provision itself.
survive a motion to dismiss under Rule 12(b)(6), a complaint
must allege “enough facts to state a claim to relief
that is plausible on its face” and “to raise a
right to relief above the speculative level.” Bell
Atlantic Corp. v. Twombly, 550 U.S. 544, 555, 570
(2007). The court accepts all well-pleaded factual
allegations of the complaint as true and views them in the
light most favorable to the nonmoving party. S.E.C. v.
Shields, 744 F.3d 633, 640 (10th Cir. 2014).
Nonetheless, judgment as a matter of law may be granted under
Rule 12(b)(6) if an affirmative defense, such as preemption,
applies. Caplinger v. Medtronic, Inc., 784 F.3d
1335, 1341 (10th Cir. 2015).
threshold matter, the court declines to resolve the present
motion on the sole basis of issue preclusion. Issue
preclusion prevents relitigation of facts and issues if, in
an earlier proceeding, the same parties or their privies had
a full and fair opportunity to litigate the critical issue,
the issue was actually litigated, and it was necessary and
essential to a final determination. Durham v.
McDonald's Rests. Of Okla., Inc., 256 P.3d 64, 66-67
(Okla. 2011). Here, defendant asserts that this doctrine
precludes relitigation of whether plaintiff's fraud claim
is preempted by federal statute and whether defendant is a
“broker” as defined by that law.
argues it did not have a “full and fair
opportunity” to litigate the pertinent questions in the
state court, correctly noting that only negligence claims
were at issue there, not a fraud claim such as is asserted
here. That argument has some force as it relates to whether
the state court determination can be said to have addressed
the effect of preemption on a fraud claim, but it does not
come to grips with the second issue which Robinson urges is
precluded-its status as a “broker.” It appears
clear enough that resolution of “broker” status
was necessary to the state court's resolution of the
motion to dismiss and plaintiff had an opportunity to address
the issue there. Once the remaining claims were dismissed
voluntarily by the plaintiff, the earlier order of dismissal
became an appealable final determination of the issue.
See Schoenhals v. PSR Investors, Inc., 299 P.3d 874,
877 (Okla.Civ.App. 2013). Defendant's
“broker” status is therefore established by issue
preclusion, but the question remains as to whether
federal preemption applies to plaintiff's fraud claim.
issue, Robinson relies on two sub-sections of § 14501.
Sub-section (b)(1) of the statute provides, subject to
exceptions apparently not applicable here, as follows:
[N]o State . . . shall enact or enforce any law, rule,
regulation, standard, or other provision having the force and
effect of law relating to . . . intrastate services of any .
. . broker.
sub-section (c)(1) of the statute provides:
[A] State . . . may not enact or enforce a law, regulation,
or other provision having the force and effect of law related
to a . . . broker . . . with respect to the transportation of
term “transportation” is defined to include
services related to the movement of property, including
“arranging for” the delivery and handling of such
property. 49 U.S.C. § 13102(23).
reach of federal preemption statutes is sometimes difficult
to determine, and the parties have not pointed to any binding
authority addressing the question at issue here. However, in
determining whether a state law or regulation is preempted by
federal law, a court looks first to the statutory language
adopted by Congress, “which necessarily contains the
best evidence of Congress' pre-emptive intent.”
CSX Transp., Inc. v. Easterwood, 507 U.S. 658, 664
(1993). Here, the pertinent sections preclude claims which
are “related to” the services of the broker or to
the broker “with respect to the transportation of
property.” Those terms imply a relatively broad
intended scope. See Morales v. Trans World Airlines,Inc., 504 U.S. 374, 383 (1992) (noting the ordinary
meaning of “relating to” is a “broad
one”); see also, Pilot Life Ins. Co. v.
Dedeaux, 481 U.S. 41, 47 (1987) (no question that common
law tort and contract actions “related to” an
ERISA plan). Further, as noted above,
“transportation” is defined to include
“arranging for” the provision of transportation
services, and plaintiff's fraud allegations plainly
relate to that activity. Interpreting a similar preemption
statute, the Supreme Court has ...