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Hogan Logistics, Inc. v. Davis Transfer Co., Inc.

United States District Court, E.D. Missouri, Eastern Division

April 27, 2017




         This matter is before the Court on the motion of defendant Davis Transfer Company, Inc., for judgment on the pleadings, pursuant to Fed.R.Civ.P. 12(c). Plaintiff has filed a response in opposition and the issues are fully briefed.

         I. Background

         Plaintiff Hogan Logistics is a freight broker and third-party logistics company that provides nationwide shipping services for its customers. Plaintiff contracts with freight carriers, such as defendant Davis Transfer, to complete the actual transport of its customers' goods. Complaint ¶¶ 9-10 [Doc. # 8]. Since 2009, plaintiff has had a transportation agreement with nonparty Imperial Savannah, L.P., the parent company of Imperial Sugar. Under this agreement, Imperial Sugar agreed to exclusively utilize plaintiff to transport goods from its Georgia facilities and plaintiff agreed to contract with carriers to ship Imperial Sugar's goods. Id. ¶¶ 11-14.

         Defendant Davis Transfer is an independent freight carrier based in Georgia. Id. at ¶ 10. On October 1, 2013, the parties executed a broker-carrier agreement, pursuant to which defendant agreed to ship freight for plaintiff's customers. Id. at ¶¶ 16-18. Defendant's primary responsibility under the agreement was to transfer freight from two Imperial Sugar facilities in Georgia to destinations throughout the southeastern United States. Id. at ¶ 19. The agreement had a one-year term which automatically renewed on October 1, 2014 and October 1, 2015. Id. at ¶¶ 24-25.

         The parties' agreement included the following provision:

During the term of this Agreement and for a period of 12 months after termination or expiration, Carrier [Davis Transfer] shall not solicit or accept traffic from any Customer where (1) the availability of such traffic or such Customer first became known to Carrier as a result of Broker's [Hogan Logistics] efforts, or (2) where such traffic or such Customer was first tendered, directly or indirectly, to the Carrier by Broker. . . . The term “Customer” specifically includes, without limitation, Imperial Sugar.

         Broker-Carrier Agreement (Agreement) ¶ 10 [Doc. # 10 p. 4]. Under the contract, the defendant's breach of the “back-solicitation” provision entitles plaintiff to a 20% commission on all “involved traffic” carried by defendant for a twelve-month period. Id.

         In November 2015, plaintiff contacted defendant regarding Imperial Sugar's freight needs for 2016. When defendant stated that it intended to raise its rates on most shipping routes, plaintiff replied that defendant's rates were already 10 to 12 percent higher than the market rate. Plaintiff stated that it would stop using defendant to ship Imperial Sugar's freight if the rates increased. Defendant ultimately agreed not to raise its prices and plaintiff used defendant to carry Imperial Sugar's freight in early 2016. [Doc. # 8 at ¶¶ 26-28]. In May 2016, Imperial Sugar stopped using plaintiff to broker regional shipments. Plaintiff subsequently learned that defendant had approached Imperial Sugar and worked out its own deal to provide shipping services to Imperial Sugar. Id. at ¶¶ 28-32.

         Plaintiff filed suit in state court, asserting claims of breach of contract, breach of the duty of good faith and fair dealing, and tortious interference. After removing the action to this Court, defendant filed its answer and now moves for judgment on the pleadings.

         III. Legal Standard

         The same standard of review applies to motions under Federal Rules of Civil Procedure 12(c) and 12(b)(6). Ashley Cty., Ark. v. Pfizer, Inc., 552 F.3d 659, 665 (8th Cir. 2009). Thus, the factual allegations of a complaint are assumed true and construed in favor of the plaintiff, “even if it strikes a savvy judge that actual proof of those facts is improbable.” Bell Atlantic Corp. v. Twombly, 550 U.S. 544, 556 (2007) (citing Swierkiewicz v. Sorema N.A., 534 U.S. 506, 508 n.1 (2002)); Neitzke v. Williams, 490 U.S. 319, 327 (1989) (“Rule 12(b)(6) does not countenance . . . dismissals based on a judge's disbelief of a complaint's factual allegations.”); Scheuer v. Rhodes, 416 U.S. 232, 236 (1974) (stating that a well-pleaded complaint may proceed even if it appears “that a recovery is very remote and unlikely”). The issue is not whether the plaintiff will ultimately prevail, but whether the plaintiff is entitled to present evidence in support of his claim. Scheuer, 416 U.S. at 236. A viable complaint must include “enough facts to state a claim to relief that is plausible on its face.” Twombly, 550 U.S. at 570; see id. at 563 (stating that the “no set of facts” language in Conley v. Gibson, 355 U.S. 41, 45-46 (1957), “has earned its retirement”); see also Ashcroft v. Iqbal, 556 U.S. 662, 678-84 (2009) (holding that the pleading standard set forth in Twombly applies to all civil actions). “Factual allegations must be enough to raise a right to relief above the speculative level.” Twombly, 550 U.S. at 555.

         A court does not consider matters outside the pleadings under Rule 12(c). Fed.R.Civ.P. 12(d); Porous Media Corp. v. Pall Corp., 186 F.3d 1077, 1079 (8th Cir. 1999) (citations omitted). It may, however, consider matters of public records, materials that do not contradict the complaint, exhibits attached to the pleadings, and materials necessarily embraced by the complaint. Mills v. City of Grand Forks, 614 F.3d 495, 498 (8th Cir. 2010). Defendant has provided a ...

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