Hoskins v. Bekins Van Lines

Hoskins filed claims against Bekins for items which were missing or damaged during shipment with Bekins, a common carrier, from Virginia to Texas . Bekins paid Hoskins $70,000, the contractual limit of liability, in settlement of the claims. Contending that she was not fully compensated, Hoskins filed suit in Texas state court, alleging negligence, breach of contract and violation of the Texas Deceptive Trade Practices Act. Among other things, Hoskins sought damages, including exemplary damages, and attorney’s fees. Hoskins’ state court petition asserted no federal claims.

In response, Bekins removed the case to federal district court based on federal question jurisdiction, asserting the Carmack Amendment to the Interstate Commerce Act. Bekins then moved to dismiss Hoskins’ state court claims on the grounds that they were pre-empted by the Carmack Amendment. The federal district court agreed with Bekins and entered a take nothing judgment against Hoskins who appealed.

The Fifth Circuit noted that federal question jurisdiction is generally determined by examination of the plaintiff’s well-pleaded complaint, subject to several exceptions created by Congress where a federal statute “so forcibly and completely displace[s] state law that the plaintiff’s cause of action is either wholly federal or nothing at all.” In determining that Hoskins’ state court claims were pre-empted, the Court considered its statement from a recent opinion where it held that federal common law remedies are preempted by the Carmack Amendment: “In actions seeking damages for the loss of property shipped in interstate commerce by a common carrier under a receipt or bill of lading, the Carmack Amendment is the shipper’s sole remedy.”

Therefore, while the Carmack Amendment does not expressly provide for removal of state law claims, Bekins properly removed this case because the Carmack Amendment completely pre-empts state law claims for loss or damage to goods arising from the interstate transportation of those goods by a common carrier. Since Bekins had paid the agreed liability limit, the Fifth Circuit affirmed the district court’ take nothing judgment in favor of Bekins.