Justia Transportation Law Opinion Summaries

Plaintiffs Charles and Grant Adler, through their business entity CM Adler LLC, distributed tortillas and other food products of Defendant Gruma Corporation to grocery stores in central New Jersey under a "Store Door Distributor Agreement" (SDDA). When Defendant terminated the relationship, Plaintiffs filed a lawsuit alleging retaliatory termination due to their organizing efforts with other distributors. Plaintiffs claimed violations of state and federal labor laws, including failure to pay minimum wages and unlawful deductions, and argued that the SDDA was a franchise agreement subject to New Jersey's Franchise Practices Act, which forbids termination without cause.The United States District Court for the District of New Jersey dismissed the case, concluding that Texas law governed under the SDDA and the case should proceed to arbitration. The District Court did not address the applicability of the Federal Arbitration Act (FAA) or Plaintiffs' exemption argument under 9 U.S.C. § 1. It found the parties had contracted for Texas law, under which the arbitration agreement was enforceable, and rejected Plaintiffs' bid to apply New Jersey law instead. The District Court also decided that Charles and Grant Adler, who did not sign the contract, were estopped from challenging its arbitration provision because they acted as parties to the contract when they performed the LLC’s work.The United States Court of Appeals for the Third Circuit reviewed the case and concluded that the FAA does not apply to the SDDA because Plaintiffs are transportation workers engaged in interstate commerce. The Court of Appeals found that the District Court erred in its choice-of-law analysis by failing to consider the impact of New Jersey public policies on its arbitrability ruling. The Court of Appeals vacated the order compelling arbitration and remanded for the District Court to complete the choice-of-law analysis under the correct framework and to reevaluate whether the individual Plaintiffs, who did not sign the arbitration agreement, are bound by its terms. View "Adler v. Gruma Corporation" on Justia Law

The drivers worked transporting water to hydraulic fracking sites within Pennsylvania. The lead plaintiff asserts that he and his coworkers often worked more than 40 hours in a week, but were paid overtime only for work performed above 45 hours per week, in violation of the Fair Labor Standards Act (FLSA), 29 U.S.C. 207(a) and Pennsylvania Minimum Wage Act (PMWA), 43 Pa. Cons. Stat. 333.104(c). Before trial, the court ordered briefing on whether the employers (trucking companies) were subject to the Motor Carrier Act exemption to the FLSA’s overtime requirements, applicable to certain interstate employment activity that is subject to the jurisdiction of the Department of Transportation. The employers stipulated to a judgment requiring them to pay overtime. The Third Circuit affirmed. While the movement of the fracking wastewater out of state could theoretically be one involving a practical continuity of movement in interstate commerce, depending on the intent of the shipper at the time shipment commenced, the role the drivers played, whether the water is altered during the fracking process, and the steps for water removal and outgoing transportation, the employers produced no evidence concerning these matters and did not meet their burden to “plainly and unmistakably” show that the MCA exemption applies. View "Mazzarella v. Fast Rig Support LLC" on Justia Law

Between 1945 and the mid-1970s, Hassell was employed as an electrician by the Railroad, responsible for the maintenance and repair of passenger railcars designed and manufactured by defendants' predecessors. Steam pipes running underneath those railcars were insulated with material containing asbestos. As a consequence of his exposure to asbestos, Hassell contracted asbestosis and mesothelioma. He died in 2009, during the pendency of his lawsuit. Defendants argued that state law claims were preempted by the Locomotive Boiler Inspection Act (LIA), 49 U.S.C. 20701, the Safety Appliance Act, 49 U.S.C. 20301, and the Federal Railroad Safety Act (FRSA), 49 U.S.C. 20101. The district court held that Hassell’s claims were preempted by the LIA. The Third Circuit vacated, noting the lack of evidence supporting defendants’ assertion that the railcar pipes at issued formed an “interconnected system” with the locomotive. Even assuming that evidence for the “interconnected system” could have been gleaned from the record, Hassell produced evidence from a former Railroad supervisor showing that, instead of being connected to locomotives, the pipes were connected to “power cars” that separately supplied steam heat to the passenger coaches. There was a genuine dispute material fact precluding summary judgment. View "In Re: Asbestos Prods. Liability Litig." on Justia Law

WI buys furniture wholesale. OEC provided WI with non-vessel-operating common carrier transportation services. WI signed an Application for Credit that granted a security interest in WI property in OEC’s possession, custody or control or en route. As required by federal law, OEC also publishes a tariff with the Federal Maritime Commission, which provides for a Carrier’s lien. WI filed voluntary Chapter 11 bankruptcy petitions. OEC sought relief from the automatic stay, arguing that it was a secured creditor with a possessory maritime lien. OEC documented debts of $458,251 for freight and related charges due on containers in OEC’s possession and $994,705 for freight and related charges on goods for which OEC had previously provided services. The estimated value of WIs’ goods in OEC’s possession was $1,926,363. WI filed an adversary proceeding, seeking release of the goods. The bankruptcy court ruled in favor of WI, citing 11 U.S.C. 542. The district court affirmed, holding that OEC did not possess a valid maritime lien on Pre-petition Goods. The Third Circuit reversed, noting the strong presumption that OEC did not waive its maritime liens on the Prepetition Goods, the clear documentation that the parties intended such liens to survive delivery, the familiar principle that a maritime lien may attach to property substituted for the original object of the lien, and the parties’ general freedom to modify or extend existing liens by contract. View "In re: World Imports LTD" on Justia Law