United States District Court, D. Massachusetts
REPORT AND RECOMMENDATION ON DEFENDANTS' MOTIONS
TO DISMISS [DOCKET NOS. 20, 22, 27, 32, 50]
JENNIFER C. BOAL UNITED STATES MAGISTRATE JUDGE.
action arises from the transportation of a submarine from
Woods Hole, Massachusetts to Australia that took place under
an agreement by plaintiff Woods Hole Oceanographic
Institution (“Woods Hole”) to loan the submarine
to the Australian National Maritime Museum (the
“Museum”). During transit, the submarine caught
fire in Connecticut and was allegedly damaged. Woods Hole
brings claims against the Museum and against several
defendants allegedly involved in the transportation of the
submarine. The Museum and defendants ATS Specialized, Inc.
(“ATS”), Sam Broughton Wright, Jr.
(“Wright”),  Ridgeway International USA, Inc.
(“Ridgeway”), and Guy Tombs Limited (“Guy
Tombs”) have moved to dismiss the claims against them.
Docket Nos. 20, 22, 27, 32, 50.,  This Court heard oral argument on January
23, 2019. For the following reasons, this Court recommends
that the District Judge assigned to this case deny the
Museum's motion to dismiss, grant in part and deny in
part ATS's motion to dismiss, grant Wright's motion
to dismiss, grant in part and deny in part Ridgeway's
motion to dismiss, and grant Guy Tombs' motion to
Hole is a nonprofit corporation, organized and existing under
the laws of the Commonwealth of Massachusetts. Complaint
¶ 1. Woods Hole is dedicated to research and education
to advance understanding of the ocean and its interaction
with the Earth system, and to communicating this
understanding for society's benefit. Id.
Hole has vast knowledge, experience, and proficiency
exploring, diving, discovering, and operating in the deepest
regions of the sea. Id. at ¶ 2. For over a
half-century, Woods Hole has been building, operating,
maintaining, managing, and repairing submersibles.
Hole is the owner of a human occupied vehicle
(“HOV”), the Deep Sea Challenger, a
custom-designed and built submersible capable of reaching
full-ocean depth (the “Submersible”).
Id. at ¶ 3. Woods Hole alleges that, prior to
the loss which is the subject matter of this case, the
Submersible was valued in excess of $30 million. Id.
at ¶ 7.
Specialized is a corporation organized and existing under the
laws of the State of Minnesota, with a principal place of
business in St. Cloud, Minnesota. Id. at ¶ 9.
is a resident and domiciliary of the State of South Carolina.
Id. at ¶ 10. Wright was driving the truck
transporting the Submersible when it caught on fire.
Id. at ¶¶ 41-42.
is a New York corporation with its principal place of
business in Plattsburgh, New York. Declaration of Guy M.
Tombs in Support of Co-Defendant Ridgeway International USA
Inc.'s Motion to Dismiss the Complaint (Docket No. 29)
(“Tombs Ridgeway Decl.”) at ¶ 3; see
also Complaint at ¶ 11.
specializes in arranging for the transport of cargo,
particularly explosives, munitions and security classified
cargo. Tombs Ridgeway Decl. at ¶ 4. Ridgeway does not
have, and has never had, an office in Massachusetts.
Id. at ¶ 5. Ridgeway is not registered, and has
never been registered, to do business in Massachusetts.
Id. at ¶ 6. It has no officers, managers or
directors in Massachusetts. Id. at ¶ 8.
Ridgeway has no property or bank accounts in Massachusetts.
Id. at ¶¶ 11, 16, 17.
has never directed advertisements specifically targeting
residents of Massachusetts. Id. at ¶ 18. It
does not derive any substantial revenue from goods used or
consumed, or services rendered, in Massachusetts.
Id. at ¶ 19.
Tombs is a Canadian corporation with its principal place of
business in Montreal, Quebec, Canada. Declaration of Guy M.
Tombs in Support of Co-Defendant Guy Tombs Limited's
Motion to Dismiss the Complaint (Docket No. 34) (“Tombs
GT Decl.”) at ¶ 3; see also Complaint at
¶ 12. Guy Tombs specializes in arranging for
transportation of conventional and over dimensional cargo.
Tombs GT Decl. at ¶ 4.
Tombs does not have, and has never had, offices in
Massachusetts. Id. at ¶ 5. It is not
registered, and has never been registered, to do business in
Massachusetts. Id. at ¶ 6. Guy Tombs has no
property, assets or bank accounts in Massachusetts.
Id. at ¶¶ 11, 16, 17.
Tombs has no employees in Massachusetts. Id. at
¶ 20. It does not direct any advertisement at
Massachusetts' residents and does not derive any
substantial revenue from goods used or consumed, or services
rendered, in Massachusetts. Id. at ¶¶
Museum was established in 1990 by the Australian National
Maritime Museum Act 1990. Declaration of Peter Rout (Docket
No. 51-1) (“Rout Decl.”) at ¶ 3. By the law
passed by the Australian Parliament, the Museum was
established as a corporation and empowered “to act on
behalf of the Commonwealth” of Australia. Id.
The Museum is wholly owned by the Australian government.
Id.; Docket No. 52.
functions of the Museum are to exhibit material included in
the national maritime collection of Australia, and maritime
cultural and historical material loaned to the Museum; to
develop, preserve and maintain the national maritime
collection of Australia; to disseminate information relating
to Australian maritime history; and to conduct for and
arrange for research into matters relating to Australian
maritime industry. Rout Decl. at ¶ 4.
Museum is funded by the Australian government, operates on a
not-for-profit basis, and does not make a profit.
Id. at ¶ 5. All shares in the Museum are owned
by the Australian government. Id.
Museum does not operate in Massachusetts and does not benefit
from conduct that takes place in Massachusetts. Id.
at ¶ 6. Besides the loan of the Submersible at issue in
this case, the Museum has never borrowed any historical or
cultural item from a person or entity in Massachusetts.
Id. at ¶ 10. In addition, the Museum has never
lent any item to any museum in Massachusetts. Id.
Museum does not purchase or sell any goods in Massachusetts.
Id. at ¶ 12. It does not advertise or
distribute any marketing materials in Massachusetts.
Id. at ¶ 13.
Museum has no employees, offices, warehouse, manufacturing or
distribution facilities, bank accounts or any other assets in
Massachusetts. Id. at ¶¶ 14, 20-22.
The Loan Agreement
in September 2013, the Museum contacted Woods Hole with a
request to borrow the Submersible. Declaration of Christopher
Land, Esq. (Docket No. 63-1) (“Land Decl.”) at
¶ 8; Declaration of Robert S.C. Munier (Docket No. 63-2)
(“Munier Decl.”) at ¶ 7; Declaration of
Anthony Tarantino (Docket No. 63-3) (“Tarantino
Decl.”) at ¶ 7. Over two years of detailed
negotiations between the Museum and Woods Hole followed,
wherein the parties negotiated the loan's terms and
conditions, including but not limited to price, insurance,
indemnity, choice of law, shipping terms and instructions,
controls, required reports, communications, and care for the
Submersible while in the Museum's care, custody, and
negotiations between the Museum and Woods Hole included
multiple meetings in Woods Hole, Massachusetts between the
Museum and Woods Hole personnel to discuss the terms and
conditions of the loan; Museum personnel inspecting the
Submersible in Woods Hole, Massachusetts; extensive emails
between the Museum and Woods Hole; and numerous telephone
conferences between Museum and Woods Hole personnel. Land
Decl. at ¶¶ 8-9, 16-44; Munier Decl. at
¶¶ 8, 16-45; Tarantino Decl. at ¶ 8; 16-45.
other things, on or about May 23, 2014, the Museum's Mike
Harvey traveled to Woods Hole, Massachusetts to discuss the
loan of the Submersible, including costs, fees, logistics,
scope, future action, and the operative timetable. Land Decl.
at ¶ 22; Munier Decl. at ¶ 21; Tarantino Decl. at
¶ 21. During this meeting, Mr. Harvey indicated that the
Museum had an annual budget of approximately $20 million to
$25 million, with approximately $800, 000 to spend on
exhibits. Id. On May 24, 2014, Mr. Harvey personally
inspected the Submersible in Woods Hole, Massachusetts. Land
Decl. at ¶ 23; Munier Decl. ¶ 22; Tarantino Decl.
at ¶ 22.
parties executed an Inward Loan Agreement for the Loan of
Objects from the Woods Hole Oceanographic Institution (WHOI)
to the Australian National Maritime Museum (ANMM) dated June
30, 2015 (the “Loan Agreement”). Docket No. 63-4.
The Loan Agreement was subsequently amended by a Variation
Agreement, which forms part of the Loan Agreement. Rout Decl.
at ¶ 7; Munier Decl. at ¶ 45; Tarantino Decl. at
to the Loan Agreement, for a payment of $30, 000, Woods Hole
agreed to loan the Submersible to the Museum from June 30,
2015 to June 1, 2020, although Woods Hole agreed to consider
extending the date of the loan for “an undetermined
period of time.” Docket No. 63-4 at 4, 22. The Museum
was responsible for collecting from and returning the
Submersible from Woods Hole, Massachusetts. Id. at
Loan Agreement also provided that, while in its possession or
control, the Museum would “take care of the
[Submersible] in accordance with the professional standards
appropriate, ” and would “not do or permit
anything which may endanger the safety of the [Submersible]
or the preservation of its quality, or which may cause any
damage or deterioration to the [Submersible].”
Id. at 6. In addition, the Museum agreed to insure
the Submersible “against all risks and ‘wall to
wall' from the time the Submersible is in the
Museum's possession or control.” Id. at 8.
The parties agreed to indemnify each other against all
“actions, claims, suits, demands, liabilities, losses,
damages and costs (including all legal costs on a
solicitor-client basis) directly or indirectly arising out
of, relating to or any way connected with any breach of [the
Loan Agreement] by it or of any of its promises and
warranties in [the Loan Agreement].” Id. at
parties agreed that the Loan Agreement would be governed by
the law of Massachusetts. Docket No. 63-4 at 23. If any
disputes arose between the parties, they were to make
“reasonable efforts to resolve the dispute by good
faith negotiation.” Id. at 12. If mediation
was not successful, either party could refer the matter to
arbitration under the Rules of Arbitration of the
International Chamber of Commerce. Id. at 22. Such
arbitration was to be conducted in London, unless otherwise
agreed by the parties. Id.
Transport And Damage To The Submersible
Museum engaged Ridgeway to manage the pickup and transport of
the Submersible to Australia. Rout Decl. at ¶ 29; Munier
Decl. at ¶ 56; Tarantino Decl. at ¶ 55. On or about
March 7, 2015, Peter Rout, Assistant Manager of Operations
for the Museum, signed a Power of Attorney Designation as
Export Forwarding Agent and Acknowledgement of Terms and
Conditions” (the “Power of Attorney”). Rout
Decl. at ¶ 32; Tarantino Decl. at ¶ 56; Tombs
Ridgeway Decl. at ¶ 26. Pursuant to the Power of
Attorney, the Museum appointed Ridgeway, its officers,
employees, and/or agents to act on its behalf “as a
true and lawful agent” of the Museum. Docket No. 51-4
Museum itself arranged for sea carriage for the Submersible
with Wallenius Willhemsen Logistics
(“Wallenius”), which was to commence in
Baltimore, Maryland. Tombs Ridgeway Decl. at ¶ 22. On
behalf of the Museum, Ridgeway arranged with
for the carriage of the Submersible from Massachusetts to
Baltimore. Id. at ¶ 28. Ridgeway also
asked Guy Tombs to arrange for cargo insurance to cover the
Submersible's transportation from Woods Hole to
Australia. Id. at ¶ 30. Guy Tombs contacted
Assurances Fort Insurance in Montreal, which in turn,
arranged for a cargo policy, policy # 50T 0845 (the
“Cargo Policy”), from Eagle Underwriting Group
Inc. (“Eagle”). Tombs GT Decl. at ¶ 23.
Ridgeway charged the Museum for the cost of the Cargo Policy.
Tombs Ridgeway Decl. at ¶ 30.
about July 22, 2015, Ridgeway issued a Truck Bill of Lading,
terms prepaid (the “Ridgeway Truck Bill of
Lading”). Complaint at ¶ 32; see also
Tombs Ridgeway Decl. at ¶ 28. The Ridgeway Truck Bill of
Lading indicated a pick up date of July 22, 2015 and a
delivery date of July 23, 2015. Complaint at ¶ 32. It
also indicated that the Submersible was to be delivered to
Baltimore, Maryland. Id. The Ridgeway Truck Bill of
Lading contained no terms, conditions, or provisions
concerning limitation of liability or choice of law.
Id. Prior to the loss which is the subject matter of
the Complaint, Ridgeway did not issue any other document
purporting to govern, control, reflect, or memorialize the
contract of carriage. Id.
about July 22, 2015, ATS took possession of the Submersible,
which was in good order and condition, and loaded it onto its
truck for transport from Woods Hole, Massachusetts to
Baltimore, Maryland. Complaint at ¶ 37; see
also Tombs Ridgeway Decl. at ¶ 31. Ridgeway
maintains that none of its employees had any direct
involvement in the loading or the transportation of the
Submersible. Tombs Ridgeway Decl. at ¶ 31. Ridgeway also
maintains that none of its employees were present when the
Submersible was loaded on the truck or during the transport
of the Submersible. Id. Ridgeway appointed an
independent surveyor who inspected the Cargo before it was
loaded at Woods Hole's facilities. Id.
one hour after departing Woods Hole, Massachusetts, en route
to Baltimore, Maryland, the truck transporting the
Submersible experienced a single tire blow out while driving
northbound on Interstate 495 near Middleborough,
Massachusetts. Complaint at ¶ 38. Following the tire
blow out, Service Tire Truck Center, Inc.
(“STTC”) inspected, serviced and repaired the
truck. Id. at ¶ 39. Woods Hole alleges that
STTC “implicitly or explicitly certified and declared
that the Truck was safe and appropriate for the
transport” of the Submersible. Id.
STTC replaced the truck's damaged tire, the truck
proceeded to a TravelCenters facility in Greenwich, Rhode
Island, where Wright and the truck spent the night.
Id. at ¶ 41. On or about July 23, 2015, after
departing the TravelCenters facility in Greenwich, Rhode
Island, en route to Baltimore, the truck caught fire, burning
the Submersible, and causing it massive damage. Id.
at ¶ 42. Woods Hole alleges that the defendant carriers
did not make delivery or return of the Submersible in like
good order and condition as when shipped to, delivered to, or
received by them, but made delivery of the Submersible in
damaged condition. Id. at ¶ 44.
The Connecticut Action
17, 2017, Anderson filed a complaint for declaratory judgment
in the United States District Court for the District of
Connecticut. Anderson Trucking Servs., Inc. v. Eagle
Underwriting Group, Inc., et al., No. 3:17-cv-00817 (D.
Conn.) (the “Connecticut Action”). Anderson named
Woods Hole, the Museum, Ridgeway, and Eagle as defendants in
the Connecticut Action. Anderson sought a declaration that it
is not liable for any damage incurred by the Submersible; or
in the event it is found liable for such damage, its
liability is limited.
August 23, 2018, Senior District Judge Charles S. Haight, Jr.
dismissed the claims against Woods Hole, Ridgeway, and Eagle
for lack of personal jurisdiction. Judge Haight denied the
Museum's motion to dismiss without prejudice to renewal
and allowed Anderson to conduct jurisdictional discovery.
Judge Haight also questioned whether the Connecticut Action
should proceed, or whether, in the interests of justice, it
should be dismissed or transferred given the parallel action
pending in this Court. Subsequently, Judge Haight directed
the parties to file a notice as to the disposition of the
motions to dismiss pending before this Court and whether
Anderson still intended to pursue its claims against the
Museum in the Connecticut Action.
Complaint contains seventeen counts. Among other things,
Woods Hole brings Carmack Amendment, breach of bailment
obligations, negligence, and unfair and deceptive practices
claims against ATS, Ridgeway, and Guy Tombs. Complaint at
¶¶ 62-140. It also brings claims for breach of
contract against Guy Tombs. Id. at ¶¶
141-146. As to the Museum, Woods Hole has brought claims for
breach of contract and breach of bailment obligations.
Id. at ¶¶ 147-163. Finally, Woods Hole
brings claims for negligence and breach of bailment against
Wright. Id. at ¶¶ 164-175.
The Motions To Dismiss
ATS, Wright, Ridgeway, Guy Tombs, and the Museum have moved
to dismiss the claims against them. Docket Nos. 20, 22, 27,
32, and 50. Defendants ATS and Wright argue that Woods
Hole's state law claims are preempted by the Carmack
Amendment. Docket No. 21 at 6-11. ATS also argues that Woods
Hole's claim for unfair and deceptive practices is
preempted by the Interstate Commerce Commission Termination
Act and the Federal Aviation Administration Authorization
Act. Docket No. 21 at 12-15.
and Guy Tombs argue that the Court lacks personal
jurisdiction over them. Docket No. 30 at 6-12; Docket No. 33
at 4-12. In the alternative, they argue that the Complaint
fails to state a claim against them. Docket No. 30 at 12-14;
Docket No. 33 at 13-17. They also argue that the Cargo Policy
Underwriters are indispensable parties and, to the extent
that they cannot be joined in this action, the Complaint
should be dismissed pursuant to Rule 19(b) of the Federal
Rules of Civil Procedure. Docket No. 30 at 15-16; Docket No.
33 at 17-18.
the Museum argues that it is immune from suit under the
Foreign Sovereign Immunities Act. Docket No. 51 at 12-18. It
also argues that the allegations against it are factually
wrong, id. at 18-20, and that it is not subject to
personal jurisdiction by the Court. Id. at 20-25.
Hole has filed oppositions to all of the motions to dismiss.
Docket Nos. 42, 44, and 63. ATS has also filed an opposition
to Ridgeway's and the Museum's motions to
dismiss.Docket Nos. 41, 79. Ridgeway, Guy Tombs,
and the Museum have filed replies in support of their motions
to dismiss. Docket Nos. 48, 65, 86. II. ANALYSIS
“[A] federal court generally may not rule on the merits
of a case without first determining that it has jurisdiction
over the category of claim in suit (subject-matter
jurisdiction) and the parties (personal jurisdiction).”
Sinochem Int'l Co., Ltd. v. Malaysia Int'l
Shipping Corp., 549 U.S. 422, 430-31 (2007). Therefore,
the Court first addresses the jurisdictional issues.
The Museum's Motion To Dismiss Based On The FSIA
Museum argues that it is immune from suit under the Foreign
Sovereign Immunities Act, 28 U.S.C. § 1604 (the
“FSIA”) and, therefore, the Court lacks
subject-matter jurisdiction over it. Docket No. 51 at 12-18.
The FSIA “provides the sole basis for obtaining
jurisdiction over a foreign state in federal court.”
Univ. Trading & Inv. Co., Inc. v. Bureau for
Representing Ukrainian Interests in Int'l and Foreign
Courts, 727 F.3d 10, 16 (1st Cir. 2013) (quoting
Argentine Republic v. Amerada Hess Shipping Co., 488
U.S. 428, 439 (1989)). It establishes a presumption of
foreign sovereign immunity from the jurisdiction of the
courts of the United States unless one of its enumerated
exceptions to immunity applies. Id. (citations
omitted). In the absence of such an exception, the district
court lacks both subject-matter and personal jurisdiction
over a suit against a foreign sovereign. Id.
First Circuit has not directly addressed the burdens of the
parties with respect to a FSIA action. Id. at 17.
However, most circuits have adopted a burden-shifting
framework. See Univ. Trading & Inv. Co. v. Bureau for
Representing Ukrainian Interests in Int'l and Foreign
Courts, 898 F.Supp.2d 301, 309 (D. Mass. 2012) (citing
cases). Under that framework, “the defendant must
present a prima facie case that it is a foreign
sovereign; the plaintiffs then have the burden of production
of offering evidence showing that, under exceptions to the
FSIA, immunity should not be granted; and finally, the
ultimate burden of persuasion remains with the
alleged foreign sovereign to show that none of the pertinent
exceptions applies.” Id. (quoting Virtual
Countries, Inc. v. Republic of S. Africa, 300 F.3d 230,
241 (2nd Cir. 2002) (emphasis in original; internal quotation
marks omitted). This Court will follow that framework here.
considering a motion to dismiss on FSIA grounds, the
“district court ‘retains considerable latitude in
devising the procedures it will follow to ferret out the
facts pertinent to jurisdiction.'” Freund v.
Republic of France, 592 F.Supp.2d 540, 553 (S.D.N.Y.
2008) (quoting APWU v. Potter, 343 F.3d 619, 627
(2nd Cir. 2003)). “This discretion includes the ability
to resolve disputed jurisdictional fact issues by reference
to evidence outside the pleadings, such as affidavits.”
Id. (citations and internal quotations marks
omitted). “[C]onsistent with foreign sovereign
immunity's basic objective, namely, to free a foreign
sovereign from suit, the court should normally resolve those
factual disputes and reach a decision about immunity as near
to the outset of the case as is reasonably possible.”
Bolivarian Republic of Venezuela v. Helmerich & Payne
Int'l Drilling Co., 137 S.Ct. 1312, 1317 (2017)
(citing Verliden B.V. v. Central Bank of Nigeria,
461 U.S. 480, 493-494 (1983)).
Whether The Museum Is A Foreign State
FSIA applies only to “foreign states.” 28 U.S.C.
§ 1604. The term “foreign state” is defined
to include “a political subdivision of a foreign state
or an agency or instrumentality of a foreign state.” 28
U.S.C. § 1603(a). Woods Hole argues that the Museum has
not met its burden to prove that ...