Federal Insurance Co. v. Union Pacific Railroad

ORDER GRANTING DEFENDANT’S MOTION FOR SUMMARY JUDGMENT [27]

I. FACTUAL BACKGROUND

This dispute arises from a train derailment that destroyed a container of nine packages of printed books (“cargo”), which was part of an international intermodal movement. The original shipper of the cargo, a Singapore company called Text International PTE Ltd. (“Text”), contracted with ocean carrier APL Co. Pte. Ltd. (“APL”) for shipment of the cargo from Singapore to Alabama under APL’s bill of lading (“APL bill”).

The APL bill contained a covenant not to sue APL’s subcontractors, to which Text assented. In the event a subcontractor was sued, the bill also contained a “Himalaya Clause.” See Mori Seiki USA, Inc. v. M.V. Alligator Triumph, 990 F.2d 444, 450 (9th Cir.1993) (“A ‘Himalaya Clause’ is a clause in an ocean bill of lading that extends the benefit of the bill’s defenses [ ] to downstream parties who have sub-contracted to perform the services contemplated by the bill”). The APL Bill also contained a $500.00 per package liability limitation that extended to inland delivery, pursuant to the Carriage of Goods By Sea Act (“COGSA”). 46 U.S.C. § 30701 .

Text opted out of a term in the APL bill…