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Canadian National Railway v. Vertis

August 16, 2011


The opinion of the court was delivered by: Wolfson, United States District Judge:



Presently before the Court is a Motion for Summary Judgment by Defendants Vertis, Inc. and American Color Graphics (collectively "Defendants"). The instant motion arises out of a Complaint filed by Plaintiff Canadian National Railway Company ("Plaintiff") against Defendants for failing to pay tariff, circular and contract charges relating to the transportation of rolled paper via freight boxcars. For the reasons that follow, Defendants' motion is granted.


Plaintiff is a Canadian corporation with its principal place of business in Montreal, Quebec. Am. Compl. ¶ 3. Defendants are printing companies that print advertisements for various clients. Defs' Statement ¶ 1. Defendant Vertis is a Delaware corporation with a business facility and registered agent in New Jersey. Id.¶ 5. Defendant American Color Graphics is a New York corporation with a registered agent in New York. Id. ¶ 6. The instant matter concerns an agreement or agreements between Plaintiff and non-party St. Mary's Paper Company Ltd. ("St. Mary's"), an insolvent Canadian paper producer, pursuant to which Plaintiff agreed to ship paper to Defendants. Defs.' Statement ¶¶ 2, 5; Defs' Ex. C, Jones/Dube Aff. ¶¶ 7-9.

Specifically, in September and October 2006, Defendants or clients of Defendants ordered rolled paper from St. Mary's. Defs' Statement ¶ 4. St. Mary's billed Defendants for the cost of shipping and Defendants or Defendants' clients paid St. Mary's for the 57 shipments including the cost of the paper and the accompanying freight charges. Defs' Fact Statement ¶ 25.

In addition to contracting with Defendants for the purchase of paper, St. Mary's independently agreed with Plaintiff to provide rail service to ship the paper. Id. at ¶¶ 5-6; Defs' Ex. C, Jones/Dube Aff. ¶¶ 9,10. To initiate the shipping, St. Mary's would inform Plaintiff that it wanted to transport a shipment of paper and would select the applicable tariff with rates dictated by private agreements between Plaintiff and St. Mary's. Defs.' Statement ¶¶ 7,8; Pl's Fact Statement ¶¶ 7,8.

Importantly, each of the paper shipments was made via boxcar; indeed, for each shipment, Plaintiff would provide St. Mary's with a boxcar in which to load the paper at St. Mary's facility for shipping. Id. ¶ 9. After loading the paper into the boxcar provided by Plaintiff, St. Mary's would notify Plaintiff through an electronic bill of lading that the boxcar was ready for transport. Id. at ¶ 10. The bills of lading were marked pre-paid and named Defendants as the consignee. Id. ¶ 21; Defs.' Ex. G. Only Plaintiff and St. Mary's received the bills of lading for each shipment. Id. ¶ 11; Pl's Resp. Statement ¶ 11.

After receiving a bill of lading, Plaintiff would send an invoice to St. Mary's for the relevant freight charges. Defs.' Statement ¶¶ 14-15. Plaintiff did not have a contractual agreement with any party other than St. Mary's to pay for the freight charges it incurred while fulfilling the St. Mary's contract and shipping the paper to Defendants. Id. at ¶ 18. Indeed, not only was St. Mary's the only party that was billed by Plaintiff, it was also the only party to pay Plaintiff for the relevant freight charges. Id. at ¶ 20; Pl's Resp. Fact Statement ¶ 20. Plaintiff never billed Defendants for any of the shipments. Id. at ¶ 28; Id. ¶ 28. Pursuant to the agreement or agreements with St. Mary's, Plaintiff made 57 shipments of paper to Defendants between September and October 2006. However, before St. Mary's paid Plaintiff the freight charges, St. Mary's filed for bankruptcy in Canada. Pl's Br. at 3.

In September 2009, Plaintiff filed the instant Complaint against Vertis only, alleging that Vertis was liable for $272,372.19 in unpaid freight costs under the Interstate Commerce Act ("ICA"), 49 U.S.C. § 10743(a)(1).*fn2 Subsequently, in April 2010, Plaintiff filed an Amended Complaint against Vertis and American Color Graphics to recover a lesser amount, $263,983.13*fn3 , in freight costs it incurred as a result of the St. Mary's contract. Id. In addition to adding American Color Graphics as a Defendant, Plaintiff alleged two new bases for Defendants' liability for the freight costs associated with the St. Mary's Contract. First, Plaintiff alleged that Defendants were liable for the freight costs under a theory of quantum meruit. Id. at ¶¶ 13, 16. In addition, Plaintiff contends that Defendants were unjustly enriched at Plaintiff's expense and, therefore, that Plaintiff is entitled to recover the value of the shipping, i.e., a benefit it allegedly conferred upon Defendants. Id. at ¶¶ 20-21.


"Summary judgment is proper if there is no genuine issue of material fact and if, viewing the facts in the light most favorable to the non-moving party, the moving party is entitled to judgment as a matter of law." Pearson v. Component Tech. Corp., 247 F.3d 471, 482 n. 1 (3d Cir. 2001) (citing Celotex Corp. v. Catrett, 477 U.S. 317, 322 (1986)); accord Fed. R. Civ. P. 56(c). For an issue to be genuine, there must be "a sufficient evidentiary basis on which a reasonable jury could find for the non-moving party." Kaucher v. County of Bucks, 455 F.3d 418, 423 (3d Cir. 2006); Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248 (1986). In determining whether a genuine issue of material fact exists, the court must view the facts and all reasonable inferences drawn from those facts in the light most favorable to the nonmoving party. Matsushita Elec. Indus. Co. v. Zenith Radio Corp., 475 U.S. 574, 587 (1986); Curley v. Klem, 298 F.3d 271, 276-77 (3d Cir. 2002). For a fact to be material, it must have the ability to "affect the outcome of the suit under governing law." Kaucher, 455 F.3d at 423. Disputes over irrelevant or unnecessary facts will not preclude a grant of summary judgment.

Initially, the moving party has the burden of demonstrating the absence of a genuine issue of material fact. Celotex, 477 U.S. at 323. Once the moving party has met this burden, the nonmoving party must identify, by affidavits or otherwise, specific facts showing that there is a genuine issue for trial. Id.; Maidenbaum v. Bally's Park Place, Inc., 870 F. Supp. 1254, 1258 (D.N.J. 1994). Thus, to withstand a properly supported motion for summary judgment, the nonmoving party must identify specific facts and affirmative evidence that contradict those offered by the moving party. Anderson, 477 U.S. at 256-57. "A nonmoving party may not 'rest upon mere allegations, general denials or. vague statements." Trap Rock Indus., Inc. v. Local 825, Int'l Union of Operating Eng'rs, 982 F.2d 884, 890 (3d Cir. 1992) (quoting Quiroga v. Hasbro, Inc., 934 F.2d 497, 500 (3d Cir. 1991)). Moreover, the non-moving party must present "more than a scintilla of evidence showing that there is a genuine issue for trial." Woloszyn v. Cnty of Lawrence, 396 F.3d 314, 319 (3d Cir. 2005). Indeed, the plain language of Rule 56(c) mandates the entry of summary judgment, after adequate time for discovery and upon motion, against a party who fails to make a showing sufficient to establish the existence of an element essential to that party's case, and on which that party will bear the burden of proof at trial. Celotex, 477 U.S. at 322.

Moreover, in deciding the merits of a party's motion for summary judgment, the court's role is not to evaluate the evidence and decide the truth of the matter, but to determine whether there is a genuine issue for trial. Anderson, 477 U.S. at 249. Credibility determinations are the province of the fact finder. ...

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