Mediterranean Shipping Company Inc. v. Huatai USA LLC

Background

Mediterranean Shipping Company (USA) Inc. sued Huatai USA LLC, Paper Sales USA Inc., and Recycling Paper Partners of PA LLC. The plaintiff alleged that it shipped cargo for the defendants, issued bills of lading and invoices, and had not received $74,789.49 in charges. The complaint asserted six claims: money due under tariffs or service contracts under the Shipping Act, breach of contract, unjust enrichment, quantum meruit, account stated, and attorneys’ fees.

The court had previously dismissed the Shipping Act and account-stated claims and allowed the plaintiff to amend. The plaintiff filed an amended complaint, and the defendants moved under Federal Rule of Civil Procedure 12(b)(6), which permits dismissal when a complaint does not adequately state a legally valid claim. The motion challenged only Counts I and V.

Count I: Shipping Act claim

The court held that the amended complaint still failed to state a claim under 46 U.S.C. § 41102(a). That provision prohibits knowingly and willfully obtaining or attempting to obtain ocean transportation at less than the applicable rates through false billing, false classification, false weighing, false reports of weight, false measurement, or another unjust or unfair device or means. The court explained that the claim required an act of concealment or a comparable false or unfair device.

The amended complaint alleged that the defendants obtained or attempted to obtain transportation at lower rates by failing to pay the charges in the plaintiff’s tariffs or service contracts. But it did not allege any act of concealment or any false billing, classification, weighing, measurement, or other unfair device. The court therefore dismissed Count I. Because the plaintiff had two complaints and two opportunities to address the problem, the court dismissed Count I with prejudice.

Count V: Account-stated claim

An account-stated claim requires allegations that an account was presented, accepted as correct, and accompanied by a promise to pay the stated amount. The court found that the plaintiff alleged it issued the relevant bills of lading and invoices, that the defendants accepted them as correct and promised to pay, and that the defendants owed $74,789.49.

The defendants argued that the account-stated claim duplicated the breach-of-contract claim. The court denied dismissal on that ground. It explained that the plaintiff could maintain both theories at this stage because the court had not yet ruled on whether a valid contract existed. The claims also sought potentially different categories of damages: the plaintiff alleged that its contracts permitted recovery of attorneys’ fees, while an account-stated claim generally did not. The court noted that the plaintiff could not recover the same damages twice.

Disposition

Judge Alvin K. Hellerstein concluded that the motion to dismiss was granted in part and denied in part. Count I was dismissed with prejudice. Count V and all other counts not challenged by the motion remained. The clerk was directed to close the motion, and the defendants were ordered to answer the amended complaint by September 7, 2020. A status conference was set for September 11, 2020.