Cell Phones and CMVs

The U.S. Department of Transportation (DOT) set January 3, 2012, as the effective date of a new hand-held cell-phone ban for commercial motor vehicle (CMV) drivers.

This means that as of today, any cell phone use behind the wheel by drivers of commercial vehicles is prohibited and against the law.

What does it prohibit?

The new rule says CMV drivers cannot "use a hand-held mobile telephone” while driving a CMV (§392.82). The rule contains the following new definitions:

“Use a hand-held mobile telephone means:
“(1)  Using at least one hand to hold a mobile telephone to conduct a voice communication;
“(2)  Dialing or answering a mobile telephone by pressing more than a single button, or“
"(3)  Reaching for a mobile telephone in a manner that requires a driver to maneuver so that he or she is no longer in a seated driving position, restrained by a seat belt that is installed in accordance with 49 CFR 393.93 and adjusted in accordance with the vehicle manufacturer’s instructions.”

"Mobile telephone means a mobile communication device that falls under or uses any commercial mobile radio service, as defined in regulations of the Federal Communications Commission, 47 CFR 20.3. It does not include two-way or Citizens Band Radio services.”
“Driving [for purposes of the ban] means operating a commercial motor vehicle on a highway, including while temporarily stationary because of traffic, a traffic control device, or other momentary delays. Driving does not include operating a commercial motor vehicle when the driver has moved the vehicle to the side of, or off, a highway and has halted in a location where the vehicle can safely remain stationary.”

Who does it affect?
For now, the rule applies to:

• All interstate commercial motor vehicle drivers (as “commercial motor vehicle” is defined in section 390.5; this includes both CDL and non-CDL drivers); and
• All intrastate CMV drivers hauling a placarded amount of hazardous materials.

In the future, it is expected that the states will adopt a similar provision for all other in-state CMV drivers (with variances based on how each state defines “CMV”). Under Appendix A to Part 355, states are given three years to adopt rules that are similar or identical to the federal standards.

What about “push to talk”?
Drivers are allowed to use push-to-talk mobile communications equipment while driving as long as the driver does not reach for, dial, or hold the actual mobile phone in his/her hand while driving and the driver is able to touch the button needed to operate the push-to-talk feature from the normal seated driving position. For example, if the mobile phone is mounted in a cradle or similar device near the driver, or there is a remote push-to-talk button near the vehicle controls to allow the driver to communicate without reaching for, dialing, or holding the actual phone in his/her hands while driving, the equipment may be used.

Can I use my phone at a stop light?
No, CMV drivers cannot use hand-held phones while temporarily stopped due to traffic, a traffic control device, or other momentary delays.

When can I use a hand-held phone?
Hand-held cell-phone use is allowed if you move the vehicle to the side of, or off, the highway and stop in a safe location.
Hand-held cell-phone use is also allowed “when necessary to communicate with law enforcement officials or other emergency services.”

Can I mount my phone within reach?
Yes, the rule does not prohibit that. Be aware that the DOT says that “reaching for any mobile phone on the passenger seat, under the driver’s seat, or into the sleeper berth are not acceptable actions.”

Can officers review my call history?
According to the DOT, “Nothing in the rule authorizes enforcement officers to require a driver to make a mobile telephone available so that the officer can review call history for purposes of enforcing this rule.” Enforcement will be handled at the state/local level, so the methods used to enforce the new rule will vary.

What are the penalties?
Fines and/or disqualification. Drivers who violate the new ban will face federal civil penalties of up to $2,750 for each offense and disqualification for multiple offenses. This includes CDL and non-CDL drivers. Violating a state law on hand-held cell-phone use is considered a “serious traffic violation” under the new rule, and a second conviction of any serious traffic violation in 3 years will result in disqualification for 60 days, or 120 days after three convictions. See §§383.51 and 391.15.
Companies that allow their drivers to violate the ban face penalties of up to $11,000 for each violation.
CSA scoring. The rule is expected to be added to the list of violations tracked under the CSA enforcement program, so violations could affect your CSA scores.

What about texting?
Texting while driving is already prohibited under federal (§392.80) and most state rules. The DOT says it has already cited over 300 CMV drivers for texting.

Legal Representation

If you or your trucking company have questions about CMV violations or questions about compliance with any of these regulations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

How CSA Works and What to Watch Out For

The long-awaited and much-modified Compliance, Safety, Accountability program known throughout the industry as CSA was officially launched by the Federal Motor Carrier Safety Administration (FMCSA) Dec. 12, 2010. And within weeks, fleets were experiencing driver issues resulting from the safety scoring system.
“It's had much more far-reaching effects than we could ever have anticipated,” says Randy Marten, chairman & CEO of Marten Transport. “They estimated that between 10 to 12% of the drivers would go away as a result of CSA, but I think that number will be much higher.” The carrier was part of the pilot program and has been operating under the system for longer than the typical carrier. Marten says he has already had to let about 12% of his drivers go because of CSA-related safety issues.

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FMCSA says the CSA program is designed to emphasize driver safety enforcement. According to the agency, studies have shown that unsafe driver behaviors are a major contributor to commercial vehicle-related crashes and also that a small segment of the commercial driver population is involved in a disproportionately large number of crashes. As a result, FMCSA expanded its approach to identifying and addressing unsafe drivers during interventions with motor carriers.

HOW THE PROGRAM WORKS

CSA is designed to identify truck driver behavior that can lead to an increased likelihood of a crash. Made up of seven Behavior Analysis Safety Improvement Categories, more commonly known as the seven BASICs, the program uses approximately 600 different violations to amass a score between 0 and 100 for each carrier. Each individual violation is assigned a severity weight to determine the final score and place the carrier within a percentile of similar carriers. Higher scores are deemed to be an indicator of increased crash likelihood with certain thresholds triggering an FMCSA intervention.
To determine a carrier's percentile scores, FMCSA uses the Safety Measurement System (SMS), which is comprised of the Carrier Safety Measurement System (CSMS) and the Driver Safety Measurement System (DSMS). The DSMS calculates a driver's score based on behavior and aggregates it with the carrier's CSMS score for the final tally.
The DSMS uses 36 months of a driver's roadside performance data across all their employers. More recent violations are weighted more heavily than older violations. Violations that occurred within the last six months count three times; violations that occurred between six months and a year ago count two times; and violations between one and two years old count only one time. After two years, violations do not count at all, but do remain on a driver's record.

THE BASICS

The BASICs were developed through a collection of information from a number of studies that quantify the associations between violations and crash risk, as well as statistical analysis and input from enforcement experts, FMCSA says. The BASICs are defined as follows:

• Unsafe driving: Operation of commercial motor vehicles in a dangerous or careless manner.
• Fatigued driving (hours of service): Operation of a vehicle by drivers who are ill, fatigued, or in non-compliance with the hours-of-service (HOS) regulations.
• Driver fitness: Drivers who are unfit due to lack of training, experience, or medical qualifications.
• Controlled substances and alcohol: Drivers who are impaired due to alcohol, illegal drugs, and misuse of prescription or over-the-counter medications.
• Vehicle maintenance: Failure to properly maintain a commercial vehicle.
• Cargo-related: Failure to properly prevent shifting loads, spilled or dropped cargo, overloading, and unsafe handling of hazardous materials.
• Crash indicator: SMS evaluates a motor carrier's crash history, which, while not specifically a behavior, may indicate a problem with the motor carrier that warrants intervention.

The carrier SMS evaluates the safety of individual motor carriers by considering all safety-based roadside inspection violations, not just out-of service violations, as well as state-reported crashes. By using 24 months of performance data, SMS assesses a motor carrier's safety performance in each of the seven BASICs.
SMS then calculates a measure for each BASIC by combining the time- and severity-weighted violations/crashes (more recent violations are weighted more heavily), normalized by exposure, which is a statistical calculation that allows SMS to make a fair comparison between carriers with different levels of activity (a hybrid of the number of power units per vehicle miles traveled or the number of relevant inspections).
Applying a similar approach to what was used in SafeStat, SMS converts each carrier's BASIC measures into percentiles based on rank relative to carriers with similar safety event groupings (number of relevant inspections, number of inspections with violations, or number of crashes).
The SMS data is updated monthly and takes approximately 10 business days to process and validate before it is uploaded to the CSA website.

DRIVER MONITORING AND SCREENING SCORES

It's critical under CSA that carriers properly screen potential drivers to assess their safety scores; however, FMCSA does not assign formal safety ratings to individual drivers. Neither drivers nor employing motor carriers have access to the DSMS. While carriers are prioritized for intervention based on their SMS score, drivers are only investigated during a carrier investigation, therefore, no intervention thresholds are in place for drivers.
Carriers and drivers do have access to the new pre-employment screening program (PSP) designed to assist carriers in assessing an individual operator's crash and serious safety violation history. Through NIC Technologies, motor carriers may request driver information for the purpose of pre-employment screening only. The driver must provide written consent. Individual drivers may request their own driver information record at any time. Electronic profiles contain five years of crash data and three years of inspection data.
A carrier pays $10 for each requested driver history. An annual subscription fee of $100 also applies. Carriers with fewer than 100 power units qualify for a discounted annual fee of $25 per year. Each subscription includes up to 10 user accounts, including the administrator. If you need more user credentials, you have to purchase a second subscription for an additional 10 user credentials. The cost of the second subscription is the same price as the initial subscription.
Individual drivers can request a personal driving history for a fee of $10. No subscription is necessary for individual drivers. To access PSP, visit http://www.psp.fmcsa.dot.gov/Pages/Enroll.aspx.
The PSP report, however, does not provide a driver DSMS score under CSA. It can be complicated to read and come up with an accurate DSMS using PSP because of differing language in reports, severity weights, caps on duplicate violations, and timeframes of incidents. This is an issue one industry supplier is attempting to remedy.

GIVING DRIVERS TOOLS

Vigillo released Roadside Resume, a free driver scorecard, in January. The program allows truck drivers to see their rating under the CSA system.
“This is the only service in the trucking industry that will make CSA scores available directly to individual drivers,” says Steve Bryan, CEO of Vigillo. “FMCSA does not have a mechanism that allows drivers to access their scores and see where they have safety deficiencies. Roadside Resume will provide that information in a free report at anytime to any driver holding a commercial driver's license.”
Vigillo's driver scorecards are based on three years of violation history and up to five current and past CDL numbers. The database includes information from carriers that are Vigillo CSA scorecard subscribers or from the newly created category of Affiliate members of the Vigillo Network, companies that have elected to provide this service to their drivers by giving Vigillo access to inspection data without paying to receive fleet scorecards.
The performance of drivers can have an impact on the ability of a fleet to secure freight from its customers, Bryan adds, so carriers need to be very focused on drivers who help and hurt their scores.
“Knowing CSA scores is critical for drivers,” Bryan explains. “There is no other industry where employees are scored and not told how they measure up. I'm not going to bash the CSA program, but I am going to bash government for creating a system to score drivers where their jobs and careers are dependent on those scores and then not tell them their score. That's riot-in-the-street-type stuff.”
As of early February, Vigillo had more than 700,000 drivers in its system. A huge influx of requests for driver reports began flowing into the company. “We were asking ourselves, ‘What in the world have we done?’” Bryan says. Vigillo's goal is to eventually have two million driver reports in its database, focusing primarily on long-haul Interstate truckers, “the ones who are really under the gun with CSA,” Bryan adds. Vigillo customer fleets have access to driver data for pre-employment screening purposes with permission from the driver.
Properly screening drivers is critical under CSA, says Don Osterberg, senior vice president of safety and driver training at Schneider National. The carrier implemented PSP into its process as soon as it was available and it's made an “enormous change” in how they screen driver applicants — but not without a price. “It's not cheap. At $10 each, it's not a small amount of money when you review as many drivers as we do.”
Osterberg believes that carriers will have to avail themselves of the government's PSP program or vendor reports such as those provided by Vigillo prior to hiring drivers or else set themselves up for litigation. “It will create exposure for carriers that don't use PSP,” he says. But he also concurs that reading the PSP reports can be tricky. “Descriptions of violations can differ from state to state; there is no common language, so they can be confusing.”

THE WHOLE STORY

The statistics from FMCSA are deceiving, Osterberg says, and there are a lot more carriers with “alert level” scores under CSA than most people think. Alert level means the carrier's CSA scores red-flag them for inspections. Osterberg, citing Dept. of Transportation statistics, says there are 750,000 carriers in the DOT database but only 92,000, or 12%, actually have CSA scores. FMCSA, he says, states that only 10% of fleets have alert level scores, but that's based on the total population. To be accurate, you have to look only at those fleets that have CSA scores and among them, 52,000, or 57%, have alert level scores, Osterberg explains.
Having an alert level score comes up as a red flag to enforcement personnel when they check a vehicle's DOT number and will target the driver for an inspection. Osterberg also suggests that CSA scores should be used by drivers in determining which carriers they haul for.
Drivers need to check a fleet's CSA score prior to hiring on or risk frequent inspections. If the carrier has consistent maintenance and equipment violations, drivers will steer clear of them to avoid adversely affecting their own safety records. Fleets that don't have enough data in the system to earn a CSA score are also red-flagged for inspections.
The number-one driver violation under CSA is speeding, according to David Heller, director of safety and policy for the Truckload Carrier's Assn. Despite the fact that many fleets have speed limiters on their rigs, he says, drivers are still racking up speeding violations on secondary roads. They may have gotten away with it in the past, but under CSA “they need to either get on board or they won't have a job,” Heller says.
That certainly is the case at Marten Transport. They are eliminating drivers with speeding issues even if they don't have any accidents because “it's just too big a risk and we can't afford it,” explains Randy Marten of Marten Transport. On the plus side, since CSA began, Marten says he's seen a large drop in DOT reportable accidents, which he largely attributes to equipping the fleet with electronic onboard recorders.
Another area where carriers have seen large numbers of violations is driver failure to wear a seat belt. That should be something “you don't even have to think about,” says Heller, but it's the third most common driver violation under CSA.
In the short time since its inception, the effects of CSA have gone much deeper than imagined, says Marten. “People who aren't up to speed on this are kidding themselves … badly.”

Typical violations and severity rating:

Failure to obey traffic control device	5
Headlamps - failing to dim when required	3
Following too close	5
Improper lane change	5
Lane restriction violation	3
Improper passing	5
Unlawfully parking and/or leaving vehicle in the roadway	1
Reckless driving	10
Railroad grade crossing violation	5
Speeding	5
State/local laws - speeding 1-5 mph over the speed limit	1
State/local laws - speeding 6-10 mph over the speed limit	4
State/local laws - speeding 11-14 mph over the speed limit	7
State/local laws - speeding 15 or mph over the speed limit	10
State/local laws - speeding in a work/construction zone	10
State/local laws - operating a commercial vehicle while texting	10
Improper turns	5
Failure to yield right of way	5
Hours-of-service violation	7

Legal Representation

If you or your trucking company have questions about CMV violations or questions about compliance with any of these regulations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

CSA Compliance

By Jim Sassen, Contributor

There are two types of carrier reactions when it comes to navigating the new Compliance, Safety, Accountability program launched by the Federal Motor Carrier Safety Administration, better known simply as CSA.

There are carriers who ignore the program and delay action, hoping everything works out. If you are in this group, you may already have seen your safety rating suffer compared to the old SafeStat system.

The other carriers are educating themselves and proactively managing the new CSA scoring methodology. You should be in this camp, even though navigating the new methodology may not be easy and has been complicated by interpretation and implementation issues.

For most fleets, the new CSA scoring methodology is more complicated and harder to manage than the old system. Carriers can face a steep learning curve as they adapt to meet the challenges of complying, as with any new methodology.

But there are no indications that the CSA program is going away. Carriers who better understand and proactively manage it now are more likely to stay out of trouble with the FMCSA and ahead of their competition with fewer roadside inspections, audits, warning letters, fines and accidents.
To implement and manage the new CSA program successfully, there are several actions you can take, all of which can contribute to a culture of safety across your organization.


1. Understand how the new CSA scoring methodology works, how your fleet will be affected by scores and how your fleet is currently scored under the new system.

This step includes understanding the seven Behavioral Analysis Safety Improvement Categories (BASICs) used for scoring: Unsafe Driving, Fatigued Driving, Driver Fitness, Vehicle Maintenance, Controlled Substances/Alcohol, Crash Indicator and Improper Loading/Cargo Securement. For more information, see the FMCSA website: http://csa.fmcsa.dot.gov.

2. Create or acquire simple-to-use CSA management tools, including scorecards. Some solutions allow you to integrate relevant performance data you already have, such as safety performance, hours of service and vehicle maintenance data, to help you proactively manage CSA compliance.

Once you incorporate this critical performance data, create a centralized location for all CSA-related information so your driver managers can have visibility into and responsibility for their drivers' performance.

3. Use the tools, scorecards and CSA scoring data together to identify performance improvement opportunities. You can accomplish this by correlating your relevant performance data to the seven applicable BASICs in the CSA scoring system. By proactively managing this data, you'll begin to see potential performance issues and trends before they result in violations, poor CSA scores, fines - and, in the worst-case scenario, accidents.

4. Once you have used the tools to identify performance improvement areas, focus your time and efforts on the drivers who need the most help. Develop consistent processes, training and tools to help managers coach drivers. This includes creating standardized coaching guidelines and a system of follow-up procedures to ensure that these discussions are taking place in a timely manner and having positive results. You should also capture and maintain histories of these performance discussions.

5. Promote visibility, accountability and positive competition with your drivers and driver managers. Use scorecards and tools that let you know when performance issues are being addressed by your drivers and driver managers. Let them see how they are performing compared with their peer groups, without compromising confidentiality.

6. Reward the positive and coach the negative. With the right CSA management tools, you can proactively identify potentially negative issues and turn them into positive solutions.

No matter what CSA or safety management system you have in place, the goal remains the same for everyone involved - to create safer roads and highways. To ensure success, fleet managers and executives must commit themselves to creating a business culture that values - and indeed embraces - safety as a core attribute of their success.

Don't wait for a warning letter from the FMCSA or until the CSA scoring system is perfected to address safety and CSA compliance. Take action immediately to actively manage compliance or risk falling further behind.

Legal Representation

If you or your trucking company have questions about CMV violations or questions about compliance with any of these regulations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

4/5/2012 DOT Allows Use of UVA-Blocking Window Film

The Department of Transportation's Federal Motor Carrier Safety Administration now allows the use of compliant window films on big rigs to block UVA rays, which have been linked to skin cancer.

Historically, the enforcement community and the trucking industry have taken the position that no film is allowed on any commercial vehicle, according to the International Window Film Association, a nonprofit group.

"The clarification represents information that impacts millions of truck drivers who drive many hours at a stretch," says Darrell Smith, executive director of the IWFA. "The FMCSA has agreed with the International Window Film Association that the use of 'clear' window films with a minimum 70% visibility rating installed on the front side windows is permitted."

The change follows numerous reports of higher-than-average rates of skin cancer on the left side of the face and arm, according to a 2011 article in the Journal of the American Academy of Dermatology. That article pointed to driver-side UVA exposure as a likely contributor to the disease.

"Sadly, long-haul drivers have faced skin cancer as 'one of the hazards of the job,' and we hope to help change that with this clarification," says Smith.

Professionally installed window film typically reduces exposure to UV radiation by up to 99%, reduces glare, interior fading and hot spots, according to the group.

Legal Representation

If you or your trucking company have questions about CMV violations or questions about compliance with any of these regulations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

4/2/2012 DOT Shuts down Utah-based Reliable Transportation Services

The U.S. Department of Transportation's Federal Motor Carrier Safety Administration (FMCSA) has ordered Utah-based Reliable Transportation Services, Inc. to immediately cease all transportation services, declaring the trucking company and its principal, Jay Zachary Barber, an imminent hazard to public safety.

The order follows an extensive review of the company's operations, which found multiple hours-of-service, hazardous materials, drug and alcohol testing and vehicle maintenance violations, as well as a high occurrence of recent crashes.

"Commercial truck companies that blatantly disregard safety should not be on our roadways and will be shut down," said U.S. Transportation Secretary Ray LaHood.

FMCSA immediately shut down Reliable Transportation after safety investigators found hours-of-service and driver qualification violations that substantially increased the likelihood of serious injury or death to the traveling public.

Investigators discovered that the company was using drivers with suspended or revoked commercial driver's licenses and operating without a driver drug and alcohol testing program. In addition, Reliable Transportation was transporting concealed hazardous material loads without valid federal registration.

"This agency will continue to exhaust every resource within its legal authority to pursue and shut down unsafe trucking companies that place the public at risk," said FMCSA Administrator Anne Ferro. "Companies that refuse to adhere to federal safety rules will not be allowed to operate."

According to the FMCSA order, “Reliable Transportation has violated countless federal statutory and regulatory motor carrier safety rules and has been in at least seven crashes in the last year, which include six crashes since December 2011.”
The order comes after an extensive review of the company’s operations that found the company:

• fails to monitor and ensure that its drivers comply with drivers’ hours of service (HOS) and records of duty status requirements;
• fails to ensure that its commercial motor vehicles are inspected, repaired, and maintained;
• fails to ensure that its drivers have appropriate licenses and endorsements for the commercial motor vehicles they operate;
• fails to ensure its drivers are medically examined and certified;
• fails to ensure its drivers are properly qualified to operate commercial motor vehicles;
• fails to comply with driver controlled substances and alcohol use testing requirements;
• fails to comply with hazardous materials regulations (HMRs ), including registration requirements, training requirements and placarding requirements; and
• intentionally submits fraudulent documents in order to avoid detection of continued safety violations.

According to the FMCSA order, the company used drivers with suspended or disqualified commercial licenses, did not have a driver drug and alcohol testing program, and violated the federal hours-of-service regulations to a degree that the company “substantially increased the likelihood of serious injury or death to the traveling public.”

Legal Representation

If you or your trucking company have questions about Hours of Service violations or questions about compliance with these regulations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

Utah CDL Traffic Ticket Defense: What you need to know

If you hold a commercial driver's license (CDL), you know that your license is your ticket to work. You know that you and your family's financial security depends on it. You know it is critical that any ticket you get can compromise your license, your job, or both.

At the law firm of Bostwick & Price, P.C., we represent commercial driver's license holders of all kinds including truck drivers, van drivers, bus drivers and other drivers who received a New York traffic violation or criminal charge.

Traffic Citations Can Put Your CDL On The Line

As a truck driver, you are constantly under pressure to get your load delivered on time, get back on the road and get to where you are going. With this comes the added pressure of worrying about getting a traffic citation that could put your CDL in jeopardy. With as much time as you put in behind the wheel of your truck, it is extremely difficult to avoid some traffic citations. The following citations, among others, can put your CDL on the line:

    Following too closely
    Speeding
    Failure to stop
    Reckless driving
    Careless driving
    Traveling in the wrong lane
    Using off-truck routes
    Failure to obey traffic control devices
    Logbook violations
    Exceeding drivers' hours
    Exceeding truck load weight limits
    Being over-length or over-width
    Tire tread depth
    Lack of required safety equipment
    Other equipment violations

Reporting Your Ticket to Your Employer

According to the U.S. Department of Transportation Commercial Drivers License Program, "Within 30 days of a conviction for any traffic violation, except parking, a driver must notify his/her employer, regardless of the nature of the violation or the type of vehicle which was driven at the time."

We have a thorough understanding of the special CDL rules that could result in your loss of your CDL and employment as a commercial truck driver. We have the experience in dealing with local prosecutor’s in getting traffic citations dismissed or reduced as much as possible under the circumstances.

Legal Representation

If you or your trucking company have questions about Utah CDL Traffic Ticket Defense or other Commercial Vehicle violations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

Will the new hours of service regulations really make a difference?

The Obama administration ruled that truck drivers cannot work more than 11 hours per day, among other hours-of-service (HOS) changes, in an attempt to improve safety and reduce 18-wheeler accidents. But the revisions could have an adverse effect on truck drivers and passenger vehicles, a concerned American Trucking Association (ATA) reports.

Under the new law, truck drivers are much more restricted in when and how they allocate hours. For instance, drivers must take at least a 30 minute break during an eight hour stretch if they are to continue working up to their 11 hours. Overall, truck drivers are now limited to 70 hour workweeks.
Instead of allowing a 34-hour restart each week, the new HOS rule mandates that drivers be off from 1-5 a.m. at least twice. Changes were also made to the definition of "on-duty," the report says. While the rules were passed with safety in mind, leaders of the ATA say the modifications will likely do nothing to improve highway safety.

ATA President and CEO Bill Graves says the Obama administration and the Federal Motor Carrier Safety Administration (FMCSA) over-reacted to 2010's increase in fatal truck accidents. ATA reports that since 2004, when the current rules first went into effect, fatalities have dropped 29.9 percent.
ATA believes the new HOS rules will cause drivers and consumers to suffer because fewer hours and more restrictions mean lost productivity and higher costs. By prohibiting truck drivers from working at least two nights per week during the graveyard shift, more big rigs will be on the roads when other vehicles are, increasing the chance of a commercial vehicle accident. Graves says FMCSA is ensuring that as droves of Americans commute to work, thousands of truck drivers will be joining them. He says this will create additional congestion and put more people at increased risk for injury.

According to the report, the greatest rates of truck-involved crashes occur between 6AM and noon. For companies or drivers to try to skirt the new HOS laws put in place could lead to heavy fines; spurning the 11-hour driving limit by three or more hours could result in fines up to $11,000 per offense, while the drivers themselves could owe up to $2,750 per violation. These penalties and the on-duty rules go into effect later this month. Other provisions will not begin until July 1, 2013.

 If you or your trucking company have questions about Hours of Service violations or questions about compliance with these regulations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

FMCSA Issues Final Rule Revising Truck Driver Hours of Service Regulations

One day after the Department of Transportation issued final flight duty and rest requirements for commercial passenger airline pilots, the DOT’s Federal Motor Carrier Safety Administration (FMCSA) on December 22, 2011, released a final rule establishing new hours of service (HOS) regulations for commercial truck drivers. Like the pilot rest rule, the truck driver HOS regulations were revised to combat fatigue-related accidents. The main changes to the HOS requirements are as follows:

• The agency will maintain the current 11-hour daily driving limit unless further study indicates that the benefits of reducing the limit outweigh the costs. The final rule does not include a change to the daily driving limit because the Agency concluded that it could not definitively demonstrate that a 10-hour limit — which it favored in the proposed rule — would have higher net benefits than an 11-hour limit. The rule does, however, reduce from 82 to 70 the weekly maximum number of hours a truck driver is permitted to work, a 15% reduction.
• The reduction in hours is accomplished by limiting a driver’s “34-hour restart” to once every 168 hours (7 days). As established under earlier HOS regulations, drivers are permitted to restart their duty time calculations whenever they take at least 34 consecutive hours off. Limiting this restart to once a week prevents drivers from working more than 70 hours per week.
• The rule mandates that the 34-hour restart period must include at least two periods of time between 1:00 and 5:00 a.m. (measured by the driver’s home terminal time) to increase the driver’s opportunity to sleep.
• The rule also requires that the drivers spend no more than 8 consecutive hours (compared to 7 hours in the proposed rule) on duty without taking a break lasting at least 30 minutes before driving. This break time may include meal breaks, time in the sleeper berth, or any other off-duty period. In response to comments on the proposed rule, the agency makes an exception for commercial motor vehicles (CMVs) carrying certain explosives. These drivers are permitted to count on-duty time spent attending the truck carrying the explosives as part of the mandatory 30-minute break, so long as they do no other work during that time.
• The rule revises the definition of “on-duty time” by excluding from that definition any time spent resting in a parked CMV or up to 2 hours spent resting in the passenger seat of a moving CMV immediately before or after spending at least 8 consecutive hours in the sleeper berth. This change applies to passenger-carrying vehicle drivers as well.
• The rule defines and establishes penalties for egregious violations of the HOS rule. Specifically, driving or allowing a driver to drive a CMV for 3 or more hours beyond the 11-hour limit can be considered an egregious violation of the rule subject to civil penalties. Employers will face a maximum penalty of up to $11,000 per offence; drivers up to $2,750 per offense. This penalty provision also applies to passenger-carrying vehicle drivers.
• The rule revises HOS provisions applicable to drivers involved with oilfield operations. Specifically, the rule makes certain technical clarifications to the time recording requirements for these drivers. "Waiting time" for certain drivers at oilfields must be shown on logbook or electronic equivalent as off duty and identified by annotations in "remarks" or a separate line added to "grid."

The rule’s changes to “on duty time” as well as to the oilfield provisions take effect 60 days after the rule is published in the Federal Register. All other portions of the rule are scheduled to take effect on July 1, 2013. The Agency noted that, generally, when implementing safety rules, it prefers to set shorter compliance dates. However, in this case, the Agency acknowledged, as many others pointed out, that industry and law enforcement may need extra time to train personnel and to adjust schedules and automated systems. The Agency concludes that the rule will mainly affect drivers who work more than 70 hours a week on a continuing basis, who are mostly a subset of long-haul truckload drivers.

 If you or your trucking company have questions about Hours of Service violations or questions about compliance with these regulations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

Texting and Driving

On January 26, 2010, U.S Transportation Secretary Ray LaHood announced federal guidance to expressly prohibit texting by drivers of commercial vehicles such as large trucks and buses.  The prohibition is effective immediately and is the latest in a series of actions taken by the Department to combat distracted driving since the Secretary convened a national summit on the issue last September.

“We want the drivers of big rigs and buses and those who share the roads with them to be safe,” said Secretary LaHood.  “This is an important safety step and we will be taking more to eliminate the threat of distracted driving.”

The action is the result of the Department’s interpretation of standing rules. Truck and bus drivers who text while driving commercial vehicles may be subject to civil or criminal penalties of up to $2,750.

"Our regulations will help prevent unsafe activity within the cab,” said Anne Ferro, Administrator for the Federal Motor Carrier Safety Administration (FMCSA). “We want to make it crystal clear to operators and their employers that texting while driving is the type of unsafe activity that these regulations are intended to prohibit."

FMCSA research shows that drivers who send and receive text messages take their eyes off the road for an average of 4.6 seconds out of every 6 seconds while texting.  At 55 miles per hour, this means that the driver is traveling the length of a football field, including the end zones, without looking at the road.  Drivers who text while driving are more than 20 times more likely to get in an accident than non-distracted drivers.  Because of the safety risks associated with the use of electronic devices while driving, FMCSA is also working on additional regulatory measures that will be announced in the coming months.

During the September 2009 Distracted Driving Summit, the Secretary announced the Department’s plan to pursue this regulatory action, as well as rulemakings to reduce the risks posed by distracted driving. President Obama also signed an Executive Order directing federal employees not to engage in text messaging while driving government-owned vehicles or with government-owned equipment.  Federal employees were required to comply with the ban starting on December 30, 2009.

If your trucking company is facing a heavy penalty for a traffic violation or a texting while driving citation, the Utah transportation law attorneys at Bostwick & Price, P.C. have the experience to provide the best defense possible. Our transportation law attorneys are ready to provide your trucking company with the legal representation it deserves. www.bostwickprice.com

Cargo Claims

Claims for loss and damage of regulated commodity is governed by the regulations published at 49 C.F.R. §370. Claims for loss, damage, or overage should be filed in writing. The bill of lading together with documentation of the destination market value of the goods should be included. Most bills of lading specify that the claim must be filed within 9 months. A shipper has 2 years after the claim is denied to file a suit to recover its loss. 

The Carmack Amendment, 49 U.S.C. §14706, provides the shipper with the statutory remedy which preempts state law remedies. Subject to the exceptions noted herein, if a shipper can prove that the carrier received the shipment in good condition and delivered it short or damaged, the carrier is liable for the loss regardless of whether the shipper can prove the carrier was negligent. As a practical matter, the statute makes the notations entered on the bill of lading at time of pickup and delivery particularly important. A clear bill of lading at time of pickup accompanied by a bill of lading noting shortage or damage creates a presumption of carrier liability which must be overcome by carrier proof.

Importantly, the statute and its preemptive effect works to the benefit of the carrier with respect to so-called special or consequential damages. Under Carmack and the common law, a carrier is not liable for damages which are not reasonably foreseeable. Carriers ordinarily are not required to deliver in time to meet any specific market and unless the carrier assumes greater liability by contract, it is not required to pay for air express replacement parts, waiting construction crews, stopped assembly lines, etc.

There are 5 common law exceptions to carrier liability:

(1) act or default of shipper;
(2) an act of God;
(3) the public enemy;
(4) the "public authority"; or
(5) the inherent vice of the commodity.

The act of default of shipper is most often raised when the carrier claims the lading was improperly packaged to withstand the ordinary perils of transport or when the carrier claims that the shipper improperly blocked or braced the shipment (see shipper load and count, infra).

The act of God defense is applicable only when a hurricane, tornado, flood, mud slide or other calamity beyond the carrier's control is the proximate cause of the loss or damage claimed.

The public enemy exception has rarely been used in the United States or Canada because it applies only to acts of military forces or possibly paramilitary insurgency. The courts have declined to classify thieves, robbers, or rioters as "public enemies" for purposes of this exception and to date, there has been no finding that the organized cargo thefts in Miami or Los Angeles can operate to excuse a carrier from liability.

The Public Authority exception includes policy action such as quarantines, road closures, etc.

Finally, a substantial amount of cargo claims litigation revolves around the shipper load and count exception in the Bill of Lading Act. See 49 U.S.C. §80113. This statutory provision says that a carrier is not liable for loss and damage (1) when the goods are loaded by the shipper, (2) when the bill notes "shipper's weight, load and count" or words of similar meaning, and (3) when the carrier does not know whether any part of the goods were received or conformed to that description.

Similarly, carriers are not liable for damage resulting from improper loading when the shipper loads the goods and words such as, "Shipper's weight, load and count" indicate that fact.

The shipper load and count provision should apply to all situations in which the shipper loads a spotted trailer and the carrier is unable to verify the count or the condition of the load. To be relieved of liability for short count at destination, the carrier needs to ensure that the shipment is sealed at point of origin before the truck leaves the dock, and that the term "SLC" or other clear language of shipper liability is included.

In our Utah transportation law practice, we understand that shortages and thefts of high value goods are some of the most troublesome cargo issues facing our clients. Only by careful use of the shipper load and count provisions, the purchase of broadly worded cargo coverage, and coextensive release rates, can carriers adequately protect themselves against significant exposure if high value items are handled.

The inherent vice defense has been defined in the landmark Missouri Pacific R.R. Co. v. Elmore & Stahl, 377 U.S. 134 (1964) case as "any existing defense, disease, decay, or other inherent nature of commodity which will cause it to deteriorate with a lapse of time."

If your trucking company is facing a cargo claim, the Utah transportation law attorneys at Bostwick & Price, P.C. have the experience to provide the best defense possible. Our transportation law attorneys are ready to provide your trucking company with the legal representation it deserves. www.bostwickprice.com

Transportation Business Issues

Transportation law involves relationships between motor carriers, shippers and logistic companies. Often, long-standing business and personal relationship have been strained.

Allow our experience to work for you. Call us to discuss your transportation law needs in legal matters involving:

• OS&D claims
• Cargo claims
• Transportation contract disputes
• Insurance negotiations and disputes
• Owner/operator contract disputes
• FMCSA regulations
• Driver medical and controlled substance compliance
• EEOC anti-discriminatory regulations

DOT and other Trucking Violations

Fines for DOT violations can quickly add up to thousands of dollars, jeopardizing a trucking business and/or an individual trucker’s commercial drivers’ license. We defend and negotiate on behalf of trucking companies in DOT audits when an unsatisfactory decision can affect your business rating. We handle cases involving:

• Log book violations, including driving too many hours
• Out of permit violations and weight violations
• Equipment violations
• Driver hiring problems
• Driving violations
• Scale violations: Pulling out of scale line too soon; pulling in and leaving the truck
• DOT inspection failure

If your trucking company needs business law services or DOT defense representation, we can help. Please contact the experienced transportation law attorneys at Bostwick & Price, P.C. www.bostwickprice.com

Cargo Loss and Damage Claims

Did you know that damage to cargo transported by “for hire” companies is governed by a special set of legal rules not ordinarily used for damage to personal property?

Since the beginning of the 20th century, damage to cargo transported by railroads and trucks have been governed by a federal statute know as the Carmack Amendment. While each court system across the county may have a different interpretation of that law, it sets up specific standards to which both the shipping public (for simplicity “shippers”) and the transportation companies (“carriers”) must comply.

When cargo is damaged during transit a shipper must establish (prove) the following:

1. delivery of the cargo to the carrier in good condition;
2. arrival of the cargo at the destination in damaged condition;
3. actual amount of the damages incurred by the shipper.

Once the shipper proves these three items, the carrier must prove that it was free from negligence AND that the damage was due to one of the excepted causes relieving the carrier from liability.

Legal Representation

If you or your trucking company have questions about asserting or defending a cargo claim, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

Hours of Service Regulations

Driver's Hours of Service

A carrier is subject to the hours of service regulations in Utah if it operates vehicles that are:

• Over 10,000 pounds gross vehicle weight rating or gross combination weight rating in either interstate or intrastate commerce.
• Designed or used to transport 15 or more passengers, including the driver.
• Any size vehicle transporting hazardous material of a type or quantity that requires the vehicle to be placarded.

Utah does not exempt agricultural operations, ground water well drilling operations, construction materials and equipment operations from the hours of service regulations.
However, in the instance of a driver who is primarily in the transportation of construction materials and equipment, as defined under 49 CFR Part 395.2, to and from an active construction site, any period of seven or eight consecutive days may end with the beginning of any off-duty period of 34 or more successive hours.

PASSENGER CARRIERS

Passenger carriers may not permit or require a driver to drive, and no driver shall drive a passenger-carrying vehicle after:

• 10 hours driving time following eight consecutive hours off duty.
• Being on duty 15 hours following eight consecutive hours off-duty.
• Being on duty 60 hours in any seven consecutive days if the carrier does not operate every day of the week.
• Being on duty 70 hours in any eight consecutive days if the carrier operates every day of the week.

PROPERTY CARRIERS

Property carriers may not permit or require a driver to drive and no driver shall drive a property-carrying vehicle after:

• 11 cumulative hours following 10 consecutive hours off duty.
• For any period after the end of the 14th hour after coming on duty following 10 consecutive hours off duty.
• Being on duty 60 hours in any seven consecutive days if the carrier does not operate every day of the week.
• Being on duty 70 hours in any eight consecutive days if the carrier operates every day of the week.

For a property carrier, any period of seven or eight consecutive days may end with the beginning of any off duty period of 34 or more consecutive hours.

There are four phases of driver's time:
On-Duty Time is all time a driver spends performing work or being ready to work, until being relieved by the carrier of all responsibility. On-Duty Time also includes any compensated work performed by the driver for a non-motor carrier entity.
Driving time is all time spent at the driving controls of a commercial motor vehicle in operation.
Off-Duty means the driver has been relieved of all responsibilities for the vehicle and its cargo or passengers and the driver is free to pursue activities of their own choosing.
Sleeper-Berth means all time spent in the sleeper-berth.
Carriers must maintain true and accurate records showing a driver's hours of service. Drivers who are subject to the hours of service regulations must record their daily activities on a record of duty status (RODS or log book), unless they meet all of the conditions for the 100 air-mile radius driver. The following is an example showing the required information on the daily log.

Items that must be included in log book:

• Date
• Total miles driving today
• Truck or tractor and trailer number
• Name of Carrier
• Driver's signature/certification
• 24-hour period starting time
• Main office address
• Remarks
• Name of co-driver
• Total hours (far right)
• Shipping document numbers(s), or name of shipper and commodity.

SHORT HAUL OPERATIONS - 100 AIR-MILE RADIUS DRIVER

49 CFR Part 395.1(e)
When a driver operates and stays within a 100 air-mile radius of their normal work reporting locations, a logbook does not have to be maintained if the following requirements are met:

• The driver operates within a 100 air-mile radius of the normal work reporting location.
• The driver, except a driver salesperson, returns to the work reporting location and is released from work within 12 consecutive hours.
• A property-carrying commercial motor vehicle driver has at least 10 hours off duty separating each 12 hours on duty.
• A passenger-carrying commercial motor vehicle driver has at least eight consecutive hours off duty separating each 12 hours on duty.
• A property-carrying commercial motor vehicle driver does not exceed 11 hours maximum driving time following 10 consecutive hours off duty, or
• A passenger-carrying commercial motor vehicle driver does not exceed 10 hours maximum driving time following eight consecutive hours off duty; and
• The motor carrier that employs the driver maintains and retains for a period of six months accurate and true time records showing:
  • The time the driver reports for duty each day
  • The total number of hours the driver is on duty each day
  • The time the driver is released from duty each day, and
  • The total time for the preceding 7 days in accordance with 49 CFR 395.8(j)(2) for drivers used for the first time or intermittently.

NON-CDL - 150 AIR-MILE RADIUS DRIVER

49 CFR 395.1(e)(2)
When a driver operates and stays within a 150 air-mile radius of their normal work reporting locations, a logbook does not have to be maintained if the following requirements are met:

• The driver operates a property-carrying commercial motor vehicle for which a commercial driver's license is not required under 49 CFR 383;
• The driver operates within a 150 air-mile radius of the location where the driver reports to and is released from work, i.e., the normal work reporting location;
• The driver returns to the normal work reporting location at the end of each duty tour;
• The driver has at least 10 consecutive hours off duty separating each on-duty period;
• The driver does not drive more than 11 hours following at least 10 consecutive hours off duty;
• The driver does not drive:
  • After the 14th hour after coming on duty on five days of any period of seven consecutive days; and
  • After the 16th hour after coming on duty on two days of any period of seven consecutive days;
  • After having been on duty for 60 hours in seven consecutive days if the employing motor carrier does not operate commercial motor vehicles every day of the week;
  • After having been on duty for 70 hours in eight consecutive days if the employing motor carrier operates commercial motor vehicles every day of the week
• Any period of seven or eight consecutive days may end with the beginning of any off-duty period of 34 or more consecutive hours;
• The motor carrier that employs the driver maintains and retains for a period of six months accurate and true time records showing;
  • The time the driver reports for duty each day;
  • The total number of hours the driver is on duty each day;
  • The time the driver is released from duty each day; and
  • The total time for the preceding seven days in accordance with 49 CFR 395.8(j)(2) for drivers used for the first time or intermittently.

RECORD RETENTION

Hours of service records (logbooks or time sheets and supporting documents) must be maintained and retained by the carrier for a period of at least six months.

If you or your trucking company have questions about Hours of Service violations or questions about compliance with these regulations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

Salt Lake City Trucking and Transportation Company Representation Lawyers

Bostwick & Price, P.C. is a Salt Lake City law firm committed to representing the interest of trucking companies. Our attorneys understand the complicated nature of the trucking industry and defend trucking companies in issues related to personal injuries, workers' compensation, and contract disputes.
Our firm takes pride in our commercial and business law practice. We know that trucking companies face complex state and federal legal and regulatory issues. Our attorneys have the experience to provide defense against lawsuits, handle insurance liability issues, and protect the rights of truck drivers.
We realize that when an accident occurs involving a semi-truck, a truck accident lawsuit will generally be filed against the trucking company. Our attorneys have helped defend numerous trucking companies against lawsuits related to driver negligence.

In addition, our lawyers have significant experience handling administrative law issues that face large trucking companies. We understand that many of the regulations faced by trucking companies are contentious and can create animosity between the industry and the National Transportation Safety Board (NTSB). We work through the Administrative Law Courts to resolve many of these issues.

Our attorneys handle a wide range of business and commercial law services for trucking companies including contract negotiation, commercial litigation, employment issues, and licensing issues.

Contact our Trucking Company Lawyers

Our lawyers provide a wide range of services for trucking companies throughout Utah, the Intermountain Region and the western United States.

If your trucking company needs a law firm with the skill, knowledge, and resources to successfully represent your current and long-term interests, please contact Bostwick & Price, P.C.

Defense to Double Payment: Contractual Waiver by the Carrier

Unfortunately, many unsophisticated carriers, and even some otherwise relatively sophisticated carriers who do not hire counsel to review their contracts, may find themselves unable to recover from a shipper when the broker does not pay the freight charges owed because they waived the right to do so by contract.

As the Court explained in Oak Harbor Freight Lines, Inc. v. Sears Roebuck & Co., supra, 513 F.3d at p. 956, carriers can waive the right to recover directly from shippers as a matter of contract:

The parties to a freight shipment generally are free to assign liability for the payment of freight charges through a contract separate from the bill of lading. Louisville & Nashville R.R. Co. v. Cent. Iron & Coal Co., 265 U.S. 59, 66-67, 44 S. Ct. 441, 68 L. Ed. 900 (1924). Such a contract may provide that "the shipper agrees absolutely to pay the charges, or . . . merely that he shall pay if the consignee does not pay . . . , or . . . that only the [consignee] shall be liable for the freight charges, or [that] both the shipper and the consignee may be made liable." Id. "It is only where the parties fail to agree or where discriminatory practices are present that the [bill of lading] default terms bind the parties." C.A.R. Transp., 213 F.3d at 479 (emphases added).

Although it is not entirely clear how such a waiver benefits a property broker, the Transportation Intermediary Association’s Model Broker-Carrier contract includes a provision (paragraph 2.D.i.) which provides that "CARRIER shall not seek payment from Shipper if Shipper can prove payment to BROKER." Thus, if the carrier is either inexperienced or not represented by competent transportation counsel, it might waive the right to collect unpaid freight charges from the shipper. 

If you or your trucking company have questions about defenses to double payment or contractual waivers by a carrier, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

Defending a Cargo Claim: Groundwork Steps to Success

Although it imposes strict liability upon carriers and freight forwarders for loss and damage to property in interstate commerce, the Carmack Amendment (See 49 U.S.C. 14706) provides motor carriers and freight forwarders the benefit of having a national uniform policy regarding liability for property loss and damage. See New York, New Haven & Hartford Railroad Co. v. Nothnagle, 346 U.S. 128, 131, 73 S.Ct. 986, 97 L.Ed. 1500 (1953); Adams Express Co. v. Croninger, 33 S.Ct. 148, 151-152 (1913). Even with this national uniform policy in place, freight counsel and their respective clients face many issues in evaluating a claim for cargo loss and damage. This paper addresses three preliminary considerations that must be taken into account prior to litigating a properly pled Carmack Amendment cause of action. The initial focus is identifying what roles various entities play in the transportation of goods in interstate commerce and their liability under Carmack. The second section addresses venue issues and outlines removal procedures. Lastly, the third section sets forth the groundwork for preliminary motions if the underlying complaint seeks to expand the preemptive scope of Carmack.

STEP ONE: KNOW WHAT ROLE YOUR CLIENT HAD IN THE TRANSACTION

            Even though it seems simple, the first and most important step in defending a Carmack Amendment claim is to establish what role your client had in the overall transaction. With the ever increasing use of different names to identify a transportation entity, knowing what hat your client was wearing during the transaction is critical to defending the Carmack Amendment claim.

            In the regulated transportation of property, there are still three types of federally licensed entities: the motor carrier, the freight forwarder, and the property broker. Although this appears simple on its face, these entities often acquire numerous authorities and do little to differentiate their separate operations in terms of corporate structure.

            By statute, the term “carrier” means a motor carrier, water carrier, and freight forwarder. See U.S.C. 13102(3). A “motor carrier” means a person providing motor vehicle transportation for compensation. See U.S.C. 13102(12).

            A “freight forwarder” means a person holding itself out to the general public (other than as a pipeline, rail, motor, or water carrier) to provide transportation of property for compensation and in the ordinary course of its business:

(a) assembles and consolidates, provides for assembling and consolidating shipments and performs or provides for break bulk and distribution of the shipments;

(b) assumes responsibility for the transportation from the place of receipt to the place of destination; and

(c) uses for any part of the transportation a carrier subject to jurisdiction under this subtitle. The term does not include a person using transportation of an air carrier subject to Part (a) of subtitle VII. See 49 U.S.C. 13102(8).

            A freight forwarder acts like a carrier vis-a-vis its shipper and similarly, it acts as a shipper vis-a-vis the carrier it retains. Under the ordinary course of its business, a freight forwarder must proffer assembly, consolidation, break bulk and distribution services for any and all traffic tendered or transportation services provided. The four service elements are basic to the definition of a freight forwarder. They are neither optional nor alternative.

The service elements are required by the use of the conjunctive “and” in the statutory definition. Thus, in order to be a freight forwarder, a party must hold itself out to the public that it is prepared to provide the definitional services on all transactions. Moreover, if a party acting as an intermediary does not actually perform, but merely proffers such services, its activity is more akin to and may be deemed to be brokerage, for which a brokerage license is required. If the conduct evidences that the entity is merely arranging transportation rather than undertaking the transportation, such activity will not be considered freight forwarding. See Chemsource, Inc. v Hub Group, Inc., 106 F.3d 1358, 1361 (7th Cir. 1997); Fireman’s Fund Insurance v. USA Truck, Inc., 1992 Fed. Carr. Cases ¶83,698; See also Travelers Indemnity Company v. Alliance Shippers, Inc., 654 F. Supp. 840 (N.D.Cal. 1986).

By statute, the term “broker” means a person other than a motor carrier, or an employee or agent of a motor carrier, that as a principal or agent sells, offers for sale, negotiates for, or holds itself out by solicitation, advertisement or otherwise, as selling, providing, or arranging for transportation by motor carrier for compensation. See 49 U.S.C. 13102(2).

Motor carriers, or persons who are employees or bona fide agents of carriers are not brokers when they arrange or offer to arrange the transportation of shipments which they are authorized to transport and which they have accepted and legally bound themselves to transport. See 49 C.F.R. 371.2(a).

“Brokerage” or “brokerage service” is defined as the arranging of transportation or the physical movement of a motor vehicle or of property. It can be performed on behalf of a motor carrier, consignor or consignee. See 49 C.F.R. 371.2(c).

A broker is generally not liable to the shipper for cargo loss or damage. See See Golden Triad Carriers, Inc. v. Paco American Corporation, 1990 Fed. Carr. Cases, ¶83,515. Brokers can limit their liability by contract. Neither the regulatory framework set forth in the Carmack Amendment nor the common law restrict a broker’s ability to freely contract with shippers, freight forwarders and others. See Service Master Co., LP v. FTR Transport, Inc., 868 F. Supp. 90, 95 (E.D.Pa. 1994). A broker is free to establish by contract, the rates, services and terms and conditions of liability assumed. See General Electric Co. v. Harper Robinson & Co., 818 F. Supp. 31 (E.D.NY 1993). In terms of liability, a crucial issue for property brokers is whether they hold themselves out to the public generally as the actual transporter of the goods. See Florida Power & Light Co. v. Federal Energy Regulatory Commission, 660 F.2d 668 (5th Cir. 1981), cert. denied, 459 U.S. 1156 (1983). If there is no evidence that a property broker held itself out as the actual transporter of the goods, it should not be found liable for cargo loss and damage, absent negligence on its part. Often, property brokers maintain contingent cargo insurance to protect their own business as well as the shipping public but acquiring same does not increase the broker’s basic legal obligations in terms of liability for the goods transported.

In contrast, motor carriers and freight forwarders have primary liability to shippers or consignees for cargo loss and damage under the Carmack Amendment in the absence of a written contract. See 49 U.S.C. 14706(a)(1).

A carrier may waive the application of the Carmack Amendment through a written contact which expressly waives its applicability. See 49 U.S.C. 14101(b)(1). The remedy for a breach of the written contract is an action in state court or district court unless the parties otherwise agree. See 49 U.S.C. 14101(b)(2).

Under Carmack, a carrier may establish rates for transportation of property (other than household goods) under which the liability of the carrier for such property is limited to a value established by a written or electronic declaration of the shipper or by written agreement between the carrier and the shipper if that value would be reasonable under the circumstances surrounding the transportation. See 49 U.S.C. 14706(c)(1)(A).

The carrier’s right to limit its liability is subject to the requirement that it provide to the shipper, upon request, “... a written or electronic copy of the rate, classification, rules, and practices based upon which any rate applicable to a shipment, or agreed to between a shipper and the carrier is based.” See 49 U.S.C. 14706(c)(1)(B).

In the absence of a written contract or applicable tariff provisions limiting liability, the motor carrier and freight forwarder are subject to the Carmack Amendment. Undoubtedly, it is important to identify what services your client was performing in order to accurately defend them in a cargo loss and damage claim.

If you or your trucking company have questions about defending a cargo claim, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

Bostwick & Price, P.C.

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Carmack Amendment

Counsel seeking recovery on behalf of their clients for damage or loss incurred as a result of the interstate shipment of goods typically file complaints alleging various state law claims such as breach of contract, negligence and fraud. What Plaintiff's counsel does not know is that such state law claims are preempted by a federal law known as the Carmack Amendment. The Carmack Amendment is a uniform national liability system for interstate carriers which provides certainty to both carrier and shipper. It specifically allows a carrier to require that all claims for loss or damage by a shipper be made in writing within nine months from the date of the loss. It also allows a carrier to limit its liability if all prerequisites have been met.

The Carmack Amendment Preempts State Law Claims

The Carmack Amendment is presently codified at 49 U.S.C. Section 14706 et seq. The courts have uniformly held that the Carmack Amendment preempts all state and common law claims and provides the sole and exclusive remedy to shippers for loss or damage in interstate transit. Hughes Aircraft v. North American Van Lines, 970 F.2d 609, 613 (9th Cir. 1992). The preemptive effect of the Carmack Amendment also applies to claims of damage or loss relating to storage and other services rendered by interstate carriers. Margetson v. United Van Lines, Inc., 785 F.Supp. 917, 919 (D.M. 1991).

The preemptive scope of the Carmack Amendment was first noted by the United States Supreme Court in Adams Express Co. v. Croninger, 226 U.S. 491 (1913). Despite the then non-exclusive language in the Carmack Amendment, the Court ruled that all state and common law causes of action relating to services under the Carmack Amendment were preempted by the liability provisions within the Carmack Amendment. Id. at 505- 06.

The Court stated:

That the legislation supersedes all the regulations and policies of a particular state upon the same subject results from its general character . . . Almost every detail of the subject is covered so completely that there can be no rational doubt that Congress intended to take possession of the subject, and supersede all state regulation with reference to it. Id.

The result of Croninger has been uniformly followed throughout the Circuits. See Hughes v. United Van Lines, Inc., 829 F.2d 1407 (7th Cir. 1987) (causes of action for negligence, breach of insurance contract, breach of contract of carriage, conversion, intentional misrepresentation, negligent misrepresentation, and negligent infliction of emotional distress are all preempted by the Carmack Amendment); R.H. Fulton v. Chicago, Rock Island and Pacific Railroad Co., 481 F.2d 326 (8th Cir. 1973) (actions for failure to properly perform or negligence performance of an interstate contract for carriage is preempted by the Carmack Amendment); Schultz v. Auld, 848 F.2d 1497 (D. Idaho 1993) (causes of action for state consumer protection violations, negligence, breach of contract, intentional misrepresentation, fraud, and conversation are all preempted by the Carmack Amendment).

The Ninth Circuit has specifically stated that common law causes of action are preempted by the Carmack Amendment. Hughes Aircraft, 970 F.2d at 613. There, the contract called for the interstate transportation of household products and included a $.60 per pound limitation of liability. Hughes Aircraft, the shipper, argued that its state law claims for breach of contract and negligence were not preempted where the common carrier was operating on a contract basis. The Court, relying on its decision in Croninger stated that Hughes Aircraft's argument was "completely meritless" and ruled that the Carmack Amendment preempted all of Hughes Aircraft's state law causes of action. Id. at 613.

The purpose of the Carmack Amendment was to provide. . .a uniform system of carrier liability that would provide certainty to both carrier and shipper by enabling the carrier to asses its risk and predict its potential liability for damages. Pietro Culotta Grapes v. Southern Pacific Transportation, 917 F.Supp. 713, 716 (E. Dist. Cal. 1996).

In Pietro Culotta, the plaintiff attempted to assert fraud, misrepresentation and interference with economic advantage claims against a common carrier relating to services rendered under the Carmack Amendment. The court, in analyzing a motion for judgment on the pleadings, ruled that "plaintiff's state causes of action would be inconsistent with the uniformity goal of the Carmack Amendment. Id. at 716. Accordingly, the motion for judgment on the pleadings was granted. Id. at 717.

A Carrier May Require That Claims Be Made In Writing Within Nine Months

Given that the Carmack Amendment provides a shipper with the sole remedy for interstate moves, all conditions precedent to bring a civil action under the Carmack Amendment must be satisfied. In particular, a carrier may, by contract, require that a claim be made to it by a shipper within nine (9) months of the shipment and that a civil action be instituted within two (2) years after the denial of such a claim. 49 U.S.C. Section 14706(e). The nine (9) month limitation is a condition precedent to bringing a civil action. Consolidated Rail Corp. v. Primary Industries Corp., 868 F.Supp. 566, 577 (S. D. NY 1994). A cause of action will simply not accrue absent strict compliance with the claims limitation. Id.

The purpose of a claim period is to provide the carrier with knowledge that the shipper will be seeking reimbursement. Taisho Marine & Fire Insurance Co. v. Vessel Gladiolus, 762 F.2d 1364 (9th Cir. 1985). There, the court held that the carrier's actual knowledge of damage to the property did not negate the requirement that written notice be given within the nine (9) month period. The court granted the carrier's motion for summary judgment on the ground that the shipper did not comply with the requirement regarding timely notice. Id. at 1369. The main policy behind the nine (9) month claim period is to allow the carrier the chance to investigate the claim so as to protect its interest. Taisho, at 1368.

A Carrier Can Limit Its Liability

The Carmack Amendment also provides that a carrier may limit its liability "to a value established by written declaration of the shipper or by a written agreement." 49 U.S.C. §14706(f). In order to effectively limit its liability, the carrier must:

1. Maintain a tariff in compliance with the requirements of the Interstate Commerce Commission;
2. Give the shipper a reasonable opportunity to choose between two or more levels of liability;
3. Obtain the shipper's agreement as to his choice of carrier liability limit; and,
4. Issue a bill of lading prior to moving the shipment that reflects any such agreement.

Hughes Aircraft v. North American Van Lines, 970 F.2d 609, 611-612 (9th Cir

Although the filing of a tariff alone will not limit a carrier's liability, the above requirements are satisfied when a shipper is given a "reasonable opportunity" to accept or deny the carrier's proposed limitation. Hughes Aircraft, 970 F.2d at 612. A "reasonable opportunity" means that the shipper had both reasonable notice of the liability limitation and the opportunity to obtain information necessary to make a deliberate and informed choice. Id. In Schultz v. Auld, 848 F.Supp. 1497, 1505 (Idaho 1993), the court held that a signature on the contract evidencing an acknowledgment and receipt of the contract and its terms was sufficient evidence of a reasonable opportunity to select among liability limitations. Id. at 1505. In fact, one court has gone so far as to say that a signature on the bill of lading is not actually required in order to limit the shipper's liability, but the shipper's mere acceptance of the contract is sufficient. Johnson v. Bekins Van Lines Company, 808 F.Supp. 545, 548 (E.D. Tex. 1992).

Conclusion

Counsel representing interstate common carriers should immediately move to dismiss all state law claims at the outset of the litigation. This will typically result in the reduction of a shipper's available damages. Counsel should also analyze whether the shipper has complied with the nine month written claim requirement and whether the carrier has effectively limited its' liability. This may form the basis for an earlier motion for summary judgment or partial summary judgment providing the carrier with an expedient resolution to litigation.

Legal Representation

If you or your trucking company have questions about the Carmack Amendment and how it applies to your trucking company or current operations, the attorneys at the law firm of Bostwick & Price, P.C. are available to answer your questions and concerns. www.bostwickprice.com

By Max J. Starkie of Bostwick & Price, P.C.