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Riley v. AK Logistics, Inc.

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

June 9, 2017




         This matter is before the Court on Defendant C.H. Robinson's Motion for Summary Judgment (Doc. 35), Motion to Exclude the Opinion of Thomas Corsi, Ph.D. (Doc. 40), Motion to Exclude the Opinions of William Hampton (Doc. 42), and Motion to Dismiss Defendants A.K. Logistics, Inc. and Sarvar Yuldashev Pursuant to Rules 12(b)(1) and 21 or, in the Alternative, Motion in Limine and for other Relief at Trial (Doc. 86). Also before the Court is Plaintiff Johnny Oscar Riley's Motion to Exclude the Opinion of Thomas A. Lambert (Doc. 85). The motions are fully briefed and ready for disposition. For the following reasons, the Court will grant in part and deny in part C.H. Robinson's Motion for Summary Judgment, Motion to Exclude the Opinion of Thomas Corsi, and Motion to Exclude the Opinions of William Hampton; grant in part and deny C.H. Robinson's Motion to Dismiss its Co-Defendants; and grant Riley's Motion to Exclude the Opinion of Thomas Lambert.


         On January 16, 2015, Plaintiff initiated this action in the Circuit Court for the County of New Madrid, Missouri; A.K. Logistics thereafter removed the matter to this Court (Docs. 1, 1.3). In his complaint, as amended, Riley alleges the following facts. On October 11, 2014, a tractor-trailer operated by Defendant Sarvar Yuldashev rear-ended a motorcycle operated by Riley on Interstate Highway 55 in New Madrid County, Missouri (“the collision”) (Doc. 51 at 1-2). Riley sustained serious physical injuries in the collision (Id. at 2-3). According to Riley, Yuldashev was employed by Defendant A.K. Logistics at the time of the collision, and the collision and the injuries he suffered therein were caused by Yuldashev's negligence and carelessness (Id. at 1-4).

         Riley asserts two claims for relief (Id. at 1-6). In Count I, he seeks compensatory damages from Yuldashev and A.K. Logistics, alleging that Yuldashev negligently and carelessly caused the collision and that he did so while acting within the course and scope of his employment with A.K. Logistics (Id. at 1-3). In Count II, Riley seeks damages from C.H. Robinson (Id. at 3-6). Specifically, he alleges that, at the time of the collision, Yuldashev was delivering a load (“the load”) for third-party non-defendants, pursuant to arrangements C.H. Robinson brokered (Id. at 4). Riley seeks to recover from C.H. Robinson under three potential theories: (1) that C.H. Robinson negligently hired A.K. Logistics as an independent contractor; (2) that C.H. Robinson is vicariously liable for Yuldashev's negligence because A.K. Logistics was its agent; and (3) that C.H. Robinson and A.K. Logistics are jointly liable for his injuries because they were acting in a joint venture in delivering the load (Id. at 3-6).


         I. C.H. Robinson's Motion for Summary Judgment

         C.H. Robinson now moves for summary judgment, arguing that it was not negligent in hiring A.K. Logistics to carry the load, that it was not in an agency relationship with A.K. Logistics or Yuldashev at the time of the collision, and that it also was not in a joint venture with A.K Logistics (Docs. 35-36, 64, 88). Riley opposes the motion, asserting that genuine disputes of material fact remain as to each of his theories of recovery (Doc. 47).

         A. Summary Judgment Standard

         The Court may grant a motion for summary judgment if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law. Fed.R.Civ.P. 56(a); Peterson v. Kopp, 754 F.3d 594, 598 (8th Cir. 2014). A moving party bears the burden of informing the Court of the basis of its motion. Celotex Corp. v. Catrett, 477 U.S. 317, 323 (1986). Once the moving party discharges this burden, the nonmoving party must set forth specific facts demonstrating that there is a dispute as to a genuine issue of material fact, not the “mere existence of some alleged factual dispute.” Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 247-48 (1986).

         In passing on a motion for summary judgment, the Court must view the facts in the light most favorable to the nonmoving party, and all justifiable inferences are to be drawn in his favor. Celotex, 477 U.S. at 331. The Court's function is not to weigh the evidence but to determine whether there is a genuine issue for trial. Anderson, 477 U.S. at 249. “Credibility determinations, the weighing of the evidence, and the drawing of legitimate inferences from the facts are jury functions, not those of a judge.” Torgerson v. City of Rochester, 643 F.3d 1031, 1042 (8th Cir. 2011) (quoting Reeves v. Sanderson Plumbing Prods., Inc., 530 U.S. 133, 150 (2000)).

         B. Negligent Hiring of an Independent Contractor

         C.H. Robinson argues that it is entitled to judgment as a matter of law to the extent Riley alleges it negligently hired A.K. Logistics as an independent contractor (Docs. 36 at 2-10; 64 at 2-12). Riley disagrees, arguing that C.H. Robinson negligently failed to adequately investigate publicly available information relating to A.K. Logistics' safety history (Doc. 47 at 2-18).

         1. Legal Standard

         An employer is liable for its independent contractor's negligent conduct if the employer fails to exercise reasonable care in hiring a competent independent contractor. LeBlanc v. Research Belton Hosp., 278 S.W.3d 201, 205-06 (Mo.Ct.App. 2008); Lonero v. Dillick, 208 S.W.3d 323, 329 (Mo.Ct.App. 2006) (citing Sullivan v. St. Louis Station Assocs., 770 S.W.2d 352, 356 (Mo.Ct.App. 1989)). An employer has a duty to hire a “skilled and competent contractor.” Lonero, 208 S.W.3d at 329 (citing Sullivan, 770 S.W.2d at 356). A competent and careful contractor has “the knowledge, skill, experience, and available equipment which a reasonable person would realize that a contractor must have in order to do the work which he or she is employed to do without creating unreasonable risk of injury to others, and who also possesses the personal characteristics which are equally necessary.” Lee v. Pulitzer Pub. Co., 81 S.W.3d 625, 635 (Mo.Ct.App. 2002) (citing Restatement (Second) of Torts § 411 (1965)).

         To establish a claim for negligent hiring of an independent contractor, Riley must demonstrate (1) that C.H. Robinson knew or should have known that A.K. Logistics was incompetent to carry the load, and (2) that C.H. Robinson's negligence in hiring A.K. Logistics proximately caused his injuries. See Gibson v. Brewer, 952 S.W.2d 239, 246 (Mo. 1997); Reed v. Kelly, 37 S.W.3d 274, 277 (Mo.Ct.App. 2000) (citing Gaines v. Monsanto Co., 655 S.W.2d 568, 570 (Mo.Ct.App. 1983)). “It is well recognized that a contractor's negligence in conducting the work it was hired to do creates no presumption that the employer was negligent in selecting the contractor. One incident of poor judgment does not prove incompetence.” Sullivan, 770 S.W.2d at 356 (internal citation omitted). Moreover, an employer is not liable for the negligence of its independent contractor, notwithstanding any lack of care it took in selecting the contractor, if the contractor hired was in fact competent. Lonero, 208 S.W.3d at 329 (citing Sullivan, 770 S.W.2d at 356).

         2. C.H. Robinson's Arguments

         C.H. Robinson asserts that A.K. Logistics and Yuldashev were competent; that to the extent they were not competent, it did not and could not have reasonably known of their incompetence; and that Riley cannot show that their alleged incompetence proximately caused the collision or his injuries (Doc. 36 at 2-10). As to Yuldashev's competence, C.H. Robinson notes that he had a valid commercial driver's license, that there is no evidence his license had ever been suspended or revoked, that he passed a road test before he was permitted to drive for A.K. Logistics, that he had been driving for A.K. Logistics for a period of two to three years before the collision, that he had not been involved in any accidents previously, and that the president of A.K. Logistics believed he was reliable (Id. at 4).

         C.H. Robinson argues that A.K. Logistics was qualified to carry the load because it had liability insurance, was authorized to operate as a motor carrier, and was unrated by the Federal Motor Carrier Safety Administration's (“FMCSA”) motor carrier safety rating system (Id.). C.H. Robinson also notes that, between December 2008 and October 2014, A.K. Logistics carried 990 loads for C.H. Robinson customers, and did so without any indication that it was unsafe or unfit (Id. at 5). In C.H. Robinson's view, it could not have been negligent in hiring A.K. Logistics in this case, given its six-year, incident-free history with the company (Id. at 5-6).

         C.H. Robinson further contends that it could not have reasonably known of Yuldashev's or A.K. Logistics' alleged incompetence (Id. at 6-8). In C.H. Robinson's view, it reasonably decided, as a matter of company policy, not to consider Behavior Analysis and Safety Improvement Categories (“BASIC scores”) when hiring motor carriers, and more specifically, when it decided to hire A.K. Logistics (Id. at 6-8). BASIC scores are another FMCSA measure used to rate motor carriers, in a variety of categories, including crashes, driver fitness, hours of service and unsafe driving. Of note, BASIC scores rank individual motor carriers' safety performance against other carriers, producing a percentile score in each category based on how a carrier has performed in comparison to its peers.

         C.H. Robinson claims that, at the time of the collision, the FMCSA's publicly accessible website warned that “[r]eaders should not draw conclusions about a carrier's overall safety condition simply based on the data displayed in this system. Unless a motor carrier in the SMS has received an UNSATISFACTORY safety rating pursuant to 49 C.F.R. Part 385, or has otherwise been ordered to discontinue operations by the FMCSA, it is authorized to operate on the nation's roadways.” (Doc. 36 at 6-7). Moreover, C.H. Robinson emphasizes that, in December 2015, Congress passed the FAST Act[1] which stated that the percentiles reflected in individual BASIC scores “may not be used for safety fitness determinations” until an inspector general made certain certifications. Pub. L. 114-94, § 5223(b), 129 Stat. 1312, 1541 (2015). The FAST Act also removed BASIC scores from public view on the FMCSA's website. According to C.H. Robinson, Congress's enactment of the FAST Act confirms the soundness of its conclusion that BASIC scores are not reliable indicators of motor carrier safety (Id. at 7). C.H. Robinson argues that it reasonably decided not to consider BASIC scores when hiring motor carriers to deliver loads on behalf of its customers, given the scores' unreliability (Id. at 6-8).

         C.H. Robinson also argues that Riley cannot link A.K. Logistics' and Yuldashev's alleged incompetence to the collision, i.e., that he cannot show that any of A.K. Logistics' unsafe-driving or hours-of-service violations proximately caused the collision (Id. at 9-10). C.H. Robinson does not appear to dispute that A.K. Logistics had a history of citations for traffic violations between September 2013 and October 2014; however, it argues that there is no evidence that those citations led to convictions or pleas, and that there is no evidence that any of the citations were issued to Yuldashev (Id. at 9). The president of A.K. Logistics testified at his deposition that Yuldashev did not receive any citations during that period (Id.).

         3. Riley's Arguments

         In response, Riley argues that the mere facts that A.K. Logistics had insurance, operating authority, and an “unrated” FMCSA rating are insufficient to establish that it was competent to carry the load (Doc. 47 at 3-19). In Riley's view, A.K. Logistics' status as FMSCA “unrated” provided no meaningful information regarding its safety record, as the “unrated” status meant only that it had not yet undergone the resource-intensive compliance review of its safety policies and programs required before the FMSCA assigns a meaningful rating, i.e., “satisfactory” or “unsatisfactory.” Riley explains that only 16, 000 of these reviews are completed each year, leaving roughly 480, 000 out of more than 500, 000 motor carriers with an “unrated” status (Id. at 5-6). In Riley's view, given A.K. Logistics' “unrated” status, C.H. Robinson had an obligation to also review its BASIC scores. Riley emphasizes that, had C.H. Robinson checked A.K. Logistics' BASIC scores, it would have learned it was ranked in the lowest 8% of all motor carriers for safe driving, and in the lowest 11% for hours of service, and had received a caution flag (Id. at 7). Riley further contends that, at the time of the collision, A.K. Logistics' BASIC scores in the unsafe-driving and hours-of-service categories rendered it a “high-risk” motor carrier under the BASIC score system (Id.). He also argues that A.K. Logistics' BASIC scores reflected that its drivers had 17 unsafe driving violations, that random driver inspections had revealed 16 additional unsafe driving violations, and that its drivers had been taken out of service at twice the rate of the national average (Id. at 7 (citing Docs. 64.7 at 67; 64.11 at 6)).

         Riley further argues that as early as 2013, A.K. Logistics' BASIC scores started to worsen, triggering a “non-ratable” review by the FMCSA, causing some brokers to start questioning its president about the scores, and leading other brokers to stop hiring it at all (Id. at 7-8). At his deposition, A.K. Logistics' president testified that A.K. Logistics' insurer canceled its policy five months before the collision due to its BASIC scores, that he knew A.K. Logistics' BASIC scores were “unacceptable, ” but that he knew he could nevertheless continue to book loads through C.H. Robinson because it did not check BASIC scores (Id. (citing Doc. 64.7 at 52, 70, 75)). In Riley's view, these facts establish that a reasonable broker would have concluded that A.K. Logistics posed an unreasonable risk to others (Id. at 9-10). Riley contends that reviewing BASIC scores before hiring a carrier is standard practice in the industry (Id. at 10). He also disagrees with C.H. Robinson's contention that BASIC scores are unreliable, argues that other brokers who rely on BASIC scores had refused to hire A.K. Logistics, and has identified two expert witnesses who are prepared to testify to the scores' reliability.[2] Riley also disputes the import of the FAST Act to this case, contending that the Act merely removed BASIC scores from public view while still allowing motor carriers and brokers to access them. He also contends that at the time of the collision, the scores were publicly available and were widely considered reliable indicators for identification of high risk carriers (Id. at 11).

         Riley also contends that he can establish a causal connection between A.K. Logistics' incompetence and the collision, i.e., that C.H. Robinson negligently hired A.K. Logistics, a carrier it should have known was incompetent, and that A.K. Logistics' incompetence proximately caused the collision (Id. at 17-19). In support of this causal connection, Riley notes that A.K. Logistics' BASIC scores placed it in the lowest 8% of carriers in the unsafe driving category, which is based, in part, on incidents of inattention and improper lane changes; that the Missouri Highway Patrol concluded that the collision was caused by Yuldashev's improper lane usage and failure to maintain a safe distance; and that an accident reconstruction expert, William Hampton, has opined that the collision was caused by Yuldashev's unsafe driving, i.e., that he made an improper lane change and was following Riley too closely (Id. at 18-19). In Riley's view, there remains a genuine dispute of fact as to whether there was a causal connection between C.H. Robinson's negligence in hiring A.K. Logistics and the collision (Id. at 19).

         In reply, C.H. Robinson reiterates its arguments in favor of summary judgment on Riley's negligent-hiring claim (Doc. 64). Moreover, it disputes Riley's contention that A.K. Logistics' insurance policy was cancelled because of its deteriorating BASIC scores, insisting that the policy was cancelled because A.K. Logistics had increased the size of its fleet beyond the policy limit (Id. at 7 (citing Doc. 64.1)). It also argues that A.K. Logistics' poor BASIC scores did not mean it was incompetent to carry the load, as the scores themselves are unreliable in predicting the risk that any individual carrier will be involved in a crash. It further emphasizes that it had not been given an “unsatisfactory” rating and was still authorized by FMCSA to transport freight (Id. at 4). Finally, C.H. Robinson contends that Riley has not established a causal connection between the BASIC scores and the collision because there is no evidence showing that Yuldashev's poor driving contributed to the BASIC scores or that he was an incompetent driver (Id. at 10-11).

         4. Analysis

         The Court concludes that there remain genuine issues of material fact as to whether C.H. Robinson negligently hired A.K. Logistics to carry the load. See Peterson, 754 F.3d at 598. More specifically, the Court concludes that there remain disputes as to whether A.K. Logistics' BASIC scores were a reliable indicator of its competence or lack thereof, and whether a reasonable motor carrier would have declined to consider BASIC scores when deciding whether to hire a specific motor carrier. Also, there is a dispute as to whether, after reviewing A.K. Logistics' BASIC scores, a reasonable broker would have hired A.K. Logistics to carry the load notwithstanding its poor BASIC scores, without at least inquiring further as to the issues and incidents underlying the scores. Notably, the president of A.K. Logistics testified that some brokers had started to inquire as to its declining scores and that other brokers had refused to hire A.K. Logistics because of its BASIC scores. See Reed, 37 S.W.3d at 277 (in a negligent-hiring claim, negligence exists if a reasonably prudent person would have anticipated the danger and provided against it); cf. Sullivan, 770 S.W.2d at 356-57 (in negligent-hiring claim, plaintiff failed to establish independent contractor's incompetence because, as relevant, she did not offer evidence that the contractor had a poor safety record or poor reputation). There is some evidence that A.K. Logistics' insurance was cancelled because of its scores. Cf. Lee, 81 S.W.3d at 635 (affirming adverse grant of summary judgment on negligent-hiring claim where plaintiff adduced no evidence that independent contractor had a poor safety record or poor reputation, or that he lacked sufficient expertise and experience to act as a motor carrier). Riley has also presented an expert witness who is prepared to testify that reliance on BASIC scores is part of the standard of care for motor carrier brokers.

         The Court further concludes that there is a factual dispute on the issue of whether A.K. Logistics' alleged incompetence, as reflected in its BASIC scores, was a proximate cause of the collision. See Reed, 37 S.W.3d at 277 (the test for proximate cause is whether an injury is the “natural and probable consequence of the defendant's negligence”; in negligent-hiring claim, employee's prior misconduct may put employer on notice of employee's proclivity for similar dangerous conduct). The Court thus concludes that genuine issues of material fact remain on Riley's negligent-hiring theory and will deny C.H. Robinson's motion for summary judgment on that theory of recovery.

         C. Agency

         C.H. Robinson further argues that it is entitled to summary judgment to the extent Riley seeks to hold it vicariously liable based on a purported agency relationship between it and A.K. Logistics. Specifically, it contends that it did not exercise sufficient control over A.K. Logistics to form an agency relationship (Docs. 36 at 11-20; 64 at 13-15; 88). In response, Riley asserts that C.H. Robinson's control over A.K. Logistics was sufficient to transform the relationship into that of an agency (Doc. 47 at 19-25).

         1. Legal Standard

         An independent contractor is “a person who contracts with another to do something for him, but who is not controlled by the other nor subject to the other's control with respect to his physical conduct in the performance of his undertaking.” Skidmore v. Haggard, 110 S.W.2d 726, 729-30 (Mo. 1937) (adopting Restatement of Agency's definition of independent contractor). “[S]imply characterizing a party an independent contractor does not make it so. Rather, a court must make a factual determination of independent-contractor status, and whether or not the parties believe they are creating the relationship of master and servant is only one factor out of many.” Stars Invest. Grp., LLC v. AT&T Corp., No. 4:15-CV-01370-AGF, 2017 WL 747610, at *5 (E.D. Mo. Feb. 27, 2017) (internal quotations and citations omitted).

         Missouri courts routinely consider the factors set forth in § 220(2) of the Restatement (Second) of Agency when determining whether a person or entity acting for another is an employee or an independent contractor for purposes of respondeat superior liability. Id. at *6 (citing Huggins v. FedExGround Package Sys., Inc., 592 F.3d 853, 860 (8th Cir. 2010)). These factors include:

(a) the extent of control which, by the agreement, the master may exercise over the details of the work;
(b) whether or not the one employed is engaged in a distinct occupation or business;
(c) the kind of occupation, with reference to whether, in the locality, the work is usually done under the direction of the employer or by a specialist without supervision;
(d) the skill required in the particular occupation;
(e) whether the employee or the workman supplies the instrumentalities, tools, and the place of work for the person doing the work;
(f) the length of time for which the person is employed;
(g) the method of payment, whether by the time or by the job;
(h) whether or not the work is a part of the regular business ...

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