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Rang Dong Joint Stock Co. v. J.F. Hillebrand USA, Inc.

United States District Court, E.D. California

July 17, 2019

J.F. HILLEBRAND USA, INC., et al., Defendants.


         Plaintiff Rang Dong Joint Stock Company, doing business as Rang Dong Winery, a California Corporation, sues defendants J.F. Hillebrand USA, Inc., a Delaware Corporation, and Blue Eagle Consolidation Services, a German business entity, for damage to cargo carried by sea.[1]Hillebrand moves to dismiss. As explained below, the court GRANTS in part and DENIES in part the motion.

         I. BACKGROUND

         On February 2, 2018, Rang Dong Winery contracted with Hillebrand to ship three containers of Rang Dong Winery's wine to Ho Chi Minh City, Vietnam. Compl., ECF No. 1, ¶ 9; see Compl. Ex. A (invoice number 5351801536 confirming Ho Chi Minh City as port of discharge and arrival date as March 14, 2018). Because Ho Chi Minh City was the port of discharge, plaintiff alleges “the Cargo should have been delivered to Cat Lai Port[, ] . . . consistent with Hillebrand's representations to Rang Dong Winery and also consistent with prior shipments Rang Dong Winery had made through Hillebrand.” Compl. ¶ 10. At hearing, the parties clarified that Cat Lai is a terminal within Ho Chi Minh City Port. Rang Dong Winery alleges on information and belief that on February 20, 2018, defendants received Rang Dong Winery's cargo for carriage under bill of lading number BQEGUSS096536. Id. ¶ 11; see Compl. Ex. B (bill of lading). The bill of lading consisted of only two pages, without any terms or conditions limiting defendants' liability. Compl. ¶ 11; see Id. Ex. B.

         At an unspecified time, and without notifying Rang Dong Winery, the cargo's destination was changed to Cai Mep Port. Id. ¶ 12. Cai Mep is also a terminal within Ho Chi Minh City, as the parties clarified at hearing. Rang Dong Winery then contacted Hillebrand, explaining that the cargo needed to be delivered to Cat Lai Port to clear customs and would be destroyed if left too long at Cai Mep Port because of “the heat in Vietnam.” Id. On March 22, 2018, Hillebrand agreed to move the cargo to Cat Lai Port, stating it would “move the cargo to the correct terminal Cat Lai. [Hillebrand] ha[s] received all amended docs this morning and informed [its] overseas office of the correction.” Id. ¶ 13. The cargo then remained at Cai Mep Port for eight days before being moved to Cat Lai Port on March 30, 2018. Id. When the cargo arrived at Cai Lai Port, it “was extensively damaged due to the delay and geographic deviation caused by Defendants.” Id. ¶ 14. Rang Dong Winery alleges it suffered more than $500, 000 in damages. Id. ¶ 17.

         Rang Dong Winery sued Hillebrand and Blue Eagle on December 12, 2018, alleging damages under the Carriage of Goods by Sea Act, false bill of lading, deviation and breach of fiduciary duty. Compl., ECF No. 1. Hillebrand now moves to dismiss. Mot., ECF No. 11.[2] Rang Dong Winery opposes, Opp'n, ECF No. 13, [3] and Hillebrand filed a reply, Reply, ECF No. 16.


         Under Rule 12(b)(6) of the Federal Rules of Civil Procedure, a party may move to dismiss a complaint for “failure to state a claim upon which relief can be granted.” A court may dismiss “based on the lack of cognizable legal theory or the absence of sufficient facts alleged under a cognizable legal theory.” Balistreri v. Pacifica Police Dep't, 901 F.2d 696, 699 (9th Cir. 1990).

         Although a complaint need contain only “a short and plain statement of the claim showing that the pleader is entitled to relief, ” Fed.R.Civ.P. 8(a)(2), in order to survive a motion to dismiss this short and plain statement “must contain sufficient factual matter . . . to ‘state a claim to relief that is plausible on its face.'” Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009) (quoting Bell Atl. Corp. v. Twombly, 550 U.S. 544, 570 (2007)). A complaint must include something more than “an unadorned, the-defendant-unlawfully-harmed-me accusation” or “‘labels and conclusions' or ‘a formulaic recitation of the elements of a cause of action.'” Id. (quoting Twombly, 550 U.S. at 555). Determining whether a complaint will survive a motion to dismiss for failure to state a claim is a “context-specific task that requires the reviewing court to draw on its judicial experience and common sense.” Id. at 679. Ultimately, the inquiry focuses on the interplay between the factual allegations of the complaint and the dispositive issues of law in the action. See Hishon v. King & Spalding, 467 U.S. 69, 73 (1984).

         In making this context-specific evaluation, this court must construe the complaint in the light most favorable to the plaintiff and accept as true the factual allegations of the complaint. Erickson v. Pardus, 551 U.S. 89, 93-94 (2007). This rule does not apply to “‘a legal conclusion couched as a factual allegation, '” Papasan v. Allain, 478 U.S. 265, 286 (1986) quoted in Twombly, 550 U.S. at 555, nor to “allegations that contradict matters properly subject to judicial notice” or to material attached to or incorporated by reference into the complaint. Sprewell v. Golden State Warriors, 266 F.3d 979, 988-89 (9th Cir. 2001). A court's consideration of documents attached to a complaint or incorporated by reference or matter of judicial notice will not convert a motion to dismiss into a motion for summary judgment. United States v. Ritchie, 342 F.3d 903, 907-08 (9th Cir. 2003); Parks Sch. of Bus. v. Symington, 51 F.3d 1480, 1484 (9th Cir. 1995); compare Van Buskirk v. Cable News Network, Inc., 284 F.3d 977, 980 (9th Cir. 2002) (noting that even though court may look beyond pleadings on motion to dismiss, generally court is limited to face of the complaint on 12(b)(6) motion).


         A. Whether Hillebrand is a Carrier under the Carriage of Goods by Sea Act

         Hillebrand argues Rang Dong Winery has not alleged Hillebrand is a carrier subject to liability under the Carriage of Goods by Sea Act (“COGSA”), 46 U.S.C. § 30701, Note § 1(a), and Rang Dong Winery's first, second and third claims should therefore be dismissed. Mot. at 10. Specifically, Hillebrand argues that Rang Dong Winery “does not allege any facts that Hillebrand acted as a carrier in this case” and the complaint's “Exhibit B . . . clearly shows that Blue Eagle issued the Bill of Lading contract and acted as the carrier” while “Hillebrand was simply an agent for Blue Eagle in issuing the Bill of Lading.” Id. at 11. At hearing, Hillebrand argued the bill of lading is dispositive as to this issue.

         Rang Dong Winery contends it has sufficiently alleged Hillebrand is a carrier in alleging Rang Dong Winery “contracted with Hillebrand to ship the Cargo, ” and argues any further inquiry is inappropriate at the pleading stage. Opp'n at 7; but see Dimond Rigging Co., LLC v. BDP Int'l, Inc., 914 F.3d 435, 443-46 (6th Cir. 2019) (resolving whether party was carrier under COGSA in motion to dismiss). Rang Dong Winery also argues that, in any event, COGSA defines “carrier” as “the owner, manager, charterer, agent, or master of a vessel, ” and thus includes Hillebrand acting as an agent here. Opp'n at 7 (emphasis omitted) (quoting 46 U.S.C. § 30701). Hillebrand responds that Rang Dong Winery mistakenly relies on the Harter Act's definition of carrier rather than the COGSA's definition. Reply at 6 (arguing “§ 30701 is the Harter Act, not COGSA. The actual definition of a carrier under COGSA is found in the Note to 46 U.S.C. § 30701 . . . .”); see 46 U.S.C. § 30701, Note § 1(a) (definition in note following § 30701, reading, “[t]he term ‘carrier' includes the owner or the charterer who enters into a contract of carriage with a shipper”).

         As to the applicable definition of “carrier” under the COGSA, the parties' divergent opinions are understandable in light of the available authority, which reflects a range of positions. A Third Circuit opinion supports Hillebrand's position, though that panel did not specifically address COGSA's definition of “carrier.” See Liberty Woods ...

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