United States District Court, E.D. Michigan, Southern Division
Steven Whalen, United States Magistrate Judge.
OPINION AND ORDER:1) GRANTING DEFENDANT LEAR
CORPORATION'S RENEWED MOTION FOR SUMMARY JUDGMENT; AND 2)
DENYING PLAINTIFF DRIVE LOGISTICS LTD'S RENEWEDMOTION FOR
D. Borman, United States District Judge.
action, Plaintiff Drive Logistics, Inc.
(“Drive”) seeks to collect
payment from Lear Corporation
(“Lear”) for freight shipments
that Drive transported on Lear's behalf. Drive maintains
that Lear is liable based on the bills of lading that were
issued in connection with each shipment; Lear contends that
Drive agreed to collect payment only from an intermediary
between the companies, and also waived any legal claims
against Lear, when it entered into a contract called the
Master Transportation Agreement with the intermediary.
of 2016, Judge Gerald E. Rosen, who was presiding over this
matter at the time, denied the parties' first round of
cross-motions for summary judgment, and permitted limited
additional discovery on a potentially dispositive issue:
whether the Drive employee who signed the Master
Transportation Agreement had actual or apparent authority to
do so. The parties have now filed Renewed Motions for Summary
Judgment. For the reasons stated below, the Court will deny
Drive's Renewed Motion for Summary Judgment and grant
Lear's Renewed Motion for Summary Judgment.
20, 2016, Judge Rosen entered an Opinion and Order in this
action denying cross-motions for summary judgment similar to
those now before this Court. (ECF No. 99 (“July
2016 Opinion”).) As further detailed below,
Judge Rosen denied both motions after finding that there was
a jury question on an issue central to both parties'
arguments: whether the Drive employee who signed the MTA on
his company's behalf had actual or apparent authority to
do so, and therefore whether Drive Logistics is bound by the
Master Transportation Agreement's waiver provision.
(See July 2016 Opinion at 33-34.) Judge Rosen also
permitted additional discovery limited to that issue, since
the record was mostly silent on it, and since the issue is
potentially dispositive of all remaining claims in this
action. (See Id. at 36; ECF No. 105.) The instant
Motions were filed after that discovery was completed.
factual background below is divided into two parts. The first
part summarizes the relationships between the parties and the
events giving rise to this lawsuit, and it is based primarily
on the factual findings set forth in Judge Rosen's July
2016 Opinion. The Court fully incorporates those findings
here, providing the summary below only by way of general
background. The second part discusses the circumstances
surrounding the alleged execution of the Master
Transportation Agreement; it is based primarily on evidence
collected during the limited discovery period and submitted
as exhibits to the parties' Motions for Summary Judgment.
is a freight company headquartered in Windsor, Ontario. Lear
manufactures automotive parts. Co-Defendants Piece by Piece
Investments, Inc. and its subsidiary PBP Logistics LLC
(collectively “PBP") were
transportation brokers. Both PBP entities are now defunct,
according to testimony of their president and co-owner
Alexander Jones. PBP largely failed to participate in this
litigation, prompting Judge Rosen to enter default judgments
against them on claims asserted by both Drive and Lear.
(See July 2016 Opinion at 3-4 & n.2; ECF Nos.
to the events of this lawsuit, Lear retained non-party Ryder
Integrated Logistics (“Ryder”)
as a logistics provider. In 2010 or 2011, Ryder enlisted PBP
to transport Lear's freight on a route between Lear's
supplier in Brownsville, Texas and Lear's facility in
Hammond, Indiana. The agreement between Ryder and PBP made
clear that PBP were not to subcontract those responsibilities
to other carriers without Ryder's prior written
permission. (See July 2016 Opinion at 4-5; ECF No.
109, Lear Mot. at 8.) A separate memorandum issued by Ryder
and signed by PBP reiterated that “brokering to other
carriers of loads tendered to [PBP] by Ryder . . . on behalf
of its shipper clients . . . is strictly prohibited[.]”
(Id. at 5.) PBP further agreed in the memorandum to
indemnify Ryder and its clients for any claims resulting
directly from PBP's subcontracting to other carriers in
violation of the agreement and the memorandum. (See
same, PBP arranged for third-party carriers to shoulder
PBP's responsibilities under the agreement without
seeking Ryder's approval: non-party Sunbelt
Transportation for the first few months of the agreement, and
Drive beginning in late 2012. PBP themselves owned neither
office space nor trucks at the relevant time. Through PBP,
Drive thus carried freight for Lear on the Texas-Indiana
route for roughly nine months in 2013. (See Id. at
5-6 & nn.3-4.)
course of discovery for this litigation, PBP produced a
“Master Transportation Agreement”
(“MTA”) that states on its face
that it was executed between Drive and PBP on March 31, 2011.
The MTA is not signed by a representative of PBP, but it is
initialed and signed by an employee named Jeff Cameron on
behalf of Drive. (See July 2016 Opinion at 6, 32
n.16.) Although the MTA was executed approximately a year and
a half before Drive agreed to carry freight for Lear, it
appears to set forth terms governing the relationship between
Drive and PBP generally. Paragraph 8 of the MTA relevantly
provides as follows, with “Carrier” referring to
Drive and “the Customer” referring generally to
PBP's clients (including Lear):
[PBP] shall pay Carrier 40 to 45 days after [PBP's]
receipt of Carrier's invoice, shipper's bill of
lading, signed clear delivery receipt and other documents
required by [PBP] or [its] Customer. Carrier agrees that it
shall not bill the Customer, shipper/consignee or any third
party directly nor shall it communicate in any manner,
directly or indirectly[, ] with [PBP] customers, consignors,
consignees or any party other than [PBP] concerning
the collection of any charges relating to transportation
services accruing in connection with or as a consequence of
this Contract; and waives any right it may otherwise have to
proceed or commence any action against any Customer for the
collection of any freight bills arising out of transportation
services performed by [C]arrier under this contract.
2016 Opinion at 6-7; see also Lear Mot. Ex. F,
Master Transportation Agreement at 4.) In other words, Drive
agreed not to go around PBP by billing or otherwise
communicating with PBP's clients. And in the key MTA provision
for the purposes of the instant Motions, the signatory to the
MTA “waive[d] any right it may otherwise have to
proceed or commence any action against any Customer for the
collection of any freight bills arising out of transportation
services performed by [C]arrier under this contract.”
record shows that Drive's billing practices for freight
charges incurred through its relationship with PBP were
consistent with the MTA-both as to charges incurred for
Drive's carrying Lear's freight on the Texas-Indiana
Route, and as to charges incurred for Drive's carrying
freight for PBP's other clients. Drive would submit proof
of delivery and an invoice to PBP, which would in turn
collect payment from Lear and then remit it to Drive.
(See Id. at 7-8.)
did not receive payment for freight transport services that
it provided to Lear between February and August of 2013. Lear
claims that it paid PBP for all of these services; PBP
evidently failed to forward the payments to Drive. After
payments from PBP to Drive became “spotty” in
mid-2013, Drive gave notice to PBP in July of that year that
as of a “specific date” in the near future, it
would no longer carry freight for them. Drive did not contact
Lear about the payments owing, and the company's
president testified that “we never contacted the
customer directly in risk of being seen as someone who went
around the broker, which can be detrimental to our
business.” (Id. at 8.)
claims that it has not been paid for a total of 424 loads
that it carried for Lear: 310 “inbound” shipments
(i.e., from Texas to Lear's facility in Indiana)
and 114 “outbound” shipments (i.e., from
Indiana to Texas). Plaintiff asserts that each shipment is
evidenced by a bill of lading, each of which was either
signed or issued by Lear. For inbound shipments, the driver
would present the bill of lading to a Lear employee on
delivery, and the employee would sign and return it. For
outbound shipments, Lear would generate a return bill of
lading. (See Id. at 9.)
contends that under the bills of lading, Lear is responsible
to Drive for the amounts that Lear paid to PBP but which PBP
failed to remit to Drive. Lear takes the position that Drive
waived all claims against Lear in paragraph 8 of the MTA. In
the July 2016 Opinion, Judge Rosen stated that “[f]or
present purposes, at least, Lear does not dispute
Plaintiff's contention that the bills of lading, viewed
in isolation, would subject Lear to primary or joint
liability for the freight charges sought by Plaintiff
here.” (Id. at 14.) Accordingly, the question
of whether Drive's purported waiver of all claims against
Lear in the MTA is enforceable is a dispositive one, and so
the circumstances surrounding the alleged execution of the
MTA merit careful consideration.
Drive's account Jeff Cameron was the Drive
employee who initialed and signed the MTA, and his testimony
in the record is drawn both from a sworn Declaration that he
submitted in 2015, and from a deposition taken in March 2017,
after Judge Rosen permitted discovery on the “actual or
apparent authority” issue. (ECF No. 110, Drive Mot. Ex.
E, Cameron Declaration; Ex. H, Deposition of Jeff Cameron.)
Both Cameron and Steven Breault, Drive's president at the
relevant time, acknowledged that it is in fact Cameron's
signature on the MTA. (Cameron Dep. 39:23-40-2; ECF No. 110,
Drive Mot. Ex. D, Deposition of Steven Breault at
worked for Drive as a “planning administrator.”
(Cameron Dep. 16:3-4.) In that capacity, he “would
receive the load sheets,  enter the information into our
[Truckmate] system, and just make sure the information was
correct and spelling was right and the addresses are accurate
and everything that was pertinent on the load sheets made
their way into the system.” (Cameron Dep. 16:5-12.)
Asked in his deposition whether he signed or initialed any
other documents in the course of his duties as a planning
administrator, Cameron testified that he typically signed or
any sort of appendices that seemed to be just like
authorization for doing the business. Anything like a major,
I don't know -- no, no, just anything that was load sheet
related was my department. Stuff that came through load
sheets, that's what I signed. It was usually stuff that
was already established between [Business Development
Manager] Clark [Brockman] and the customer.
Dep. 26:24-27:10; see also Breault Dep. 10:8-14.)
While Cameron did interact with customers, he would typically
“talk to the customer, be nice to the customer, get
some preliminary details, [and] possibly answer questions if
we had availability in the area, ” but when it came to
“negotiations, that was [Brockman].” (Cameron
Dep. 26:8-23.) Cameron was expressly authorized by Brockman
to sign some documents, but it was generally
made clear by the customer who was able to sign a document.
If someone was sending me a document, they knew my role. Any
time a conversation would get serious about, like, dollar
amounts, whatever, they knew that they would have to go up
from me because I'm just a planning administrator, the
guy at the keyboard, the data entry guy. . . . If they're
doing business with us, they know what I did, and they knew
what Clark did and they knew the difference.
Dep. 22:4-19.) Immediately after that testimony, Cameron
testified as follows regarding what would happen at the
beginning of a customer relationship:
Q. And if it's the very beginning of a relationship, they
wouldn't know, would they?
A. Well, they wouldn't be sending me something to sign
Q. Well, they might send something for someone to sign,
Q. And if they sent it to Mr. Brockman and he handed it to
you to sign, you would do that. . . .
[A.]: Like, in the moment I couldn't -- it depends. . . .
Q. If Mr. Brockman received a document and handed it to you
and said 'hey, I just got this, sign it and send it
back', would you do that or would you not follow his
instructions? . . .
[A.]: It would depend on the situation. . . .
Q. Describe a situation in which Mr. Brockman handed you a
document and instructed you to sign it and return it to the
origin and you wouldn't do that. . . .
[A.]: I can't remember a situation.
(Cameron Dep. 22:20-23:23.)
testified that he had no recollection of signing the MTA,
that he “did not know how [his] signature got there[,
]” and that he did not knowingly sign the agreement.
(Cameron Dep. 39:18-22.) In his Declaration, Cameron
characterized his signing of the MTA as probably
unintentional, averring that “[t]he only thing I can
think of is that I signed for the receipt of some load
building documentation and this document was included within
that documentation.” (Cameron Decl. ¶ 4.) He
elaborated in his deposition:
Q. . . . So you believe this document or this page might have
been slipped in with some load building documentation and you
just signed it semi-automatically?
A. Like, might have been just to keep things moving. Like, if
I signed something I wasn't supposed to sign, someone
would tell me.
Q. Okay. So somehow this document was slipped in and you
signed it with other documents and moved it along?
Q. Do you have any idea how it would have gotten back to PBP
A. It appears to have been faxed.
Q. And that would have been you doing that, correct? . . .
[A.]: Not at that hour. . . .
Q. You're referring to the 8:18 p.m?
Q. Is that when you sent it or received it?
A. That's a good question too.
Q. When -- so your theory is that this was in a bunch of
documents and you just signed it along with the other
Q. Would it make sense that you would have initialed the
bottom of every page in that scenario too, because these are
your initials on the bottom of every page, aren't there?
Q. So you would have viewed every page of this document,
initialed every page of this document except the last one
where you would have signed, correct?
Q. And in all that process, you never realized this was not a
A. I knew it wasn't a load sheet. I just thought it was
something we needed to get going. If it was an important
thing, the customer knows, it's not my department.
Q. Who told you to say ...