The Carmack Amendment, Preemption, and Torts

Kevin Anderson Cargo Liability, Transportation

The Carmack Amendment is a federal law that establishes a national policy of liability for theĀ  interstate shipment of goods. Because it is a federal law, it takes precedence over state law claims that relate to damage or loss of goods during shipping goods across state lines. This basic legal rule is known as preemption, and it is based in the Supremacy Clause of the U.S. Constitution.

In most cases this rule works to dismiss claims of breach of contract, loss of property, or damage to goods against a carrier. But it is not always clear what other claims can be preempted by the Carmack Amendment. In fact, anyone familiar at all with litigation knows how complicated seemingly simple cases can become. A basic breach of contract claim can easily blossom to a complex litigation involving many other counts. It is in these kinds of situations where courts step in and try to whittle down which claims belong where.

Contract and Tort Claims

Often times in a breach of contract claim, the person bring the case will want more than a ruling on whether a contract was broken. Many times the plaintiff is so upset about what happened they want to bring every claim imaginable, including personal injury claims for emotional distress, fraud, and others. One particularly popular claim among the plaintiff bar is intentional infliction of emotional distress.

This claim, known as IIED, is a rather new form of personal injury claims, but is recognized throughout the country. In order to recover, a plaintiff must show that a defendant acted intentionally, and outrageously, to inflict emotional distress and cause damage to the plaintiff. Often when a shipment goes missing and the plaintiff is lied to about its whereabouts, the subsequent lawsuit will involved an IIED claim. This is particularly true when the goods were personal objects belonging to the plaintiff.

As a result of this recurring scenario, appeals courts across the country have developed rules on whether a claim of IIED can be brought in connection with lost or damaged goods; or, whether such claims are preempted by the Carmack Amendment. Here in the 9th Circuit, our court of appeals decided this issue in 2008, in White v. Mayflower Transit, LLC, 543 F. 3d 581(9th Cir. 2008).

In that case, the plaintiff was very upset about the loss and damage to his goods by the carrier. They went to arbitration and came to a resolution, but he was still not satisfied and brought an IIED claim against the company. His claim was based on the lies he alleged he was told, the mistreatment he suffered, and other slights. But the defendants argued that an IIED claim would be preempted by the Carmack Amendment because it is connected with the loss and damage to property shipped interstate.

In their ruling, the 9th Circuit agreed with the defendants. They ruled that a claim for IIED is preempted by the Carmack Amendment when it is based out of the same claims that give rise to a Carmack Amendment claim. And that is the law going forward in this area. But this issue of which claims are preempted and which are not continues to be a sticky issue in Carmack Amendment litigations.

If you are facing claims against your company for lost or damaged cargo, contact us. At Anderson and Yamada, P.C. we have decades of experience handling these and other transportation law issues. We look forward to hearing from you soon.