JOE HEATON, Chief District Judge.
This 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 its losses.
Mammoth originally brought suit against Robinson and the carrier in Oklahoma state court, asserting claims for negligence, negligent supervision, and breach of contract.
A year 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.
Robinson 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.
To 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."
As a 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.
Plaintiff 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
On that 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:
Similarly, sub-section (c)(1) of the statute provides:
The 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).
The 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."
While the issue is not free from doubt, and questions of the reach of particular preemption provisions are always fact and statute specific, the court concludes that the referenced portions of 49 U.S.C. § 14501 bar the fraud claims asserted here.
Robinson's motion to dismiss [Doc. #6] is