Carmack Amendment Attorney Fee Issue
As a matter of law, an award of attorneys’ fees should not be made in favor of a successful shipper-claimant pursuant to a Carmack Amendment claim (formerly 49 U.S.C. § 11711, then 49 U.S.C. § 14708(a)), where the regulated carrier has provided and communicated to the shipper the availability of a settlement dispute program which the shipper has failed to invoke. This position by the appellant Carrriers was rejected by the Ninth Circuit Court of Appeals in Campbell v. Allied Van Lines, 410 F.3d 618 (9th Cir. 2005). Shortly thereafter, however, Congress amended the statute to more closely align with the appellant’s position. The majority of appellants’ statutory construction argument is presented below.
Attorneys’ fees were not awardable in a Carmack Amendment property damage lawsuit until Congress provided for them in 1980 as part of a statute intended to encourage arbitration, rather than litigation. Under that 1980 version of the arbitration statute, a shipper-claimant who had prior notice of a carrier’s voluntarily provided arbitration program, but sued without invoking that program, was not eligible to receive a fee award. The only change Congress intended in 1995 in revising and re-codifying the arbitration statute was to make a carrier provided arbitration program mandatory, rather than voluntary. Congress did not intend to eliminate the requirement that a shipper-claimant with prior notice of the arbitration program had to invoke the arbitration program as a condition to receiving any fee award in a subsequent lawsuit. Because the Shipper did not utilize the Carrier’s arbitration program, an attorneys’ fee award was not available.
I. Necessity of Authorizing Statute
Federal courts follow the “American Rule” that “the prevailing litigant is ordinarily not entitled to collect a reasonable attorneys’ fee from the loser.” Alyeska Pipeline Service Co. v. Wilderness Society, 421 U.S. 240, 247 (1975). Except where Congress has made specific provision for an award of attorneys’ fees by statute, litigants are responsible for their own fees. Id. at 257, 260, 262. See also Drucker v. O’Brien’s Moving & Storage, Inc., 963 F.2d 1171, 1173 (9th Cir. 1992). So, the Shippers are not entitled to an award of fees unless there is an applicable statute authorizing such an award.
The Carmack Amendment pre-empts state law claims by a shipper arising from the interstate transport by a regulated carrier of household goods. “Congress intended to take possession of the subject, and supersede all state regulations with reference to it.” Adams Express Co. v. Aircraft Co. v. North American Van Lines, Inc., 970 F.2d 609, 613 (9th Cir 1992). See also New York, N.H. & Hartford R. Co. v. Nothnagle, 346 U.S. 128, 131 (1953); Hughes Aircraft Co. v. North American Van Lines, Inc., 970 F.2d 609, 613 (9th Cir. 1992); Tayloe v. Kachina Moving & Storage, Inc., 16 F. Supp. 2d 1123, 1127 (D. Ariz. 1998). So, the Shippers are not entitled to an award of fees unless there is an authorizing statute within the Carmack Amendment. The only statute which authorizes such a fee award is the statute which provides for an arbitration program that Shipper failed to use.
II. Fee Awards Under Carmack Amendment
With respect to property damage claims (as described below), originally the Carmack Amendment permitted no award of attorneys’ fees. The amendments in 1980, to encourage carriers voluntarily to provide arbitration alternatives to lawsuits and to encourage shippers to use arbitration, permitted an award of fees only if the shipper had to resort to court because the carrier failed to provide for arbitration or, if provided, the shipper was unable to get compliance from the carrier with a timely decision. Otherwise, the shipper could not obtain any fee award. The amendments in 1995 were intended to continue in effect the same restrictions on obtaining fee awards, except that it was no longer optional for the carrier whether to provide an arbitration program; it was mandatory.
A. Background of ICA and Carmack
In 1887 Congress passed the ICA [Interstate Commerce Act] to regulate the interstate transportation of goods. In its original form, the ICA governed interstate carriers’ freight rates, but not their liability for loss and damage to goods. . . .
In 1906 Congress passed the Hepburn Act amending the ICA. The Hepburn Act’s provisions governing interstate carrier liability, commonly known as the Carmack Amendment, were originally set out in Title 49 U.S.C. § 20(11). The Motor Carrier Act of 1935 extended Carmack to interstate motor carriers. In 1978 the ICA was recodified, with Carmack then found at 49 U.S.C. §§ 10730 and 11707. The ICA was recodified again effective January 1, 1996 in the ICC Termination Act of 1995 (“ICCTA”), where Carmack is now found at 49 U.S.C. § 14706. . . .
The 1978 recodification of the ICA was without substantive change to its original provisions at 49 U.S.C. § 20(11).
G. Wright, “Slouching Toward a Morass: The Case for Preserving Complete Carmack Preemption,” 1 DePaul Bus. & Com. L. J. 177, 180-81 (2003)(footnotes omitted).
The early version of the Carmack Amendment did permit attorneys’ fees to be taxed as part of costs where the injury or damage resulted from violation of the Interstate Commerce Act. The Supreme Court held that this applied only where the damage was sustained as a consequence of violating a provision of the act (a regulatory violation), but not where “the cause of action was the loss of the plaintiff’s property which had been entrusted to it as a common carrier, and that loss is in no way traceable to the violation of any provision of the act to regulate commerce.” Atlantic Coast Line Railroad Co. v. Riverside Mills, 219 U.S. 186, 208 (1911)(striking the district court award of attorneys’ fees in a property damage claim). Accord Reed v. Aaacon Auto Transport, Inc., 637 F.2d 1302, 1309 (10th Cir. 1981)(“although we recognize that Reed incurred substantial attorney’s fees to pursue his just claim, we must affirm the denial of their recovery in these circumstances”). See also Missouri P. R. Co. v. Harper Bros., 201 F. 671, 676 (7th Cir. 1912). Prior to 1980, attorney fees were not awarded in property damage cases under the Carmack Amendment.
B. 1980 Amendments
The House Report to the Household Goods Transportation Act of 1980, which made some amendments to the Carmack Amendment, identified among the purposes of the bill that:
5. Section 7 provides the statutory guidelines for dispute settlement programs which offer shippers a forum for the fair and expeditious settlement of claims;
6. Section 7 provides shippers with recovery of attorney fees stemming from litigation involving claims where no dispute settlement program is available;
H.R. Rep. No. 96-1372, at 5 (1980), reprinted in 1980 U.S.C.C.A.N. 4275 (regarding P.L. 96-454)(emphasis added). Section 7 of that Household Goods Transportation Act of 1980 introduced the former attorney fee statute, then codified at 49 U.S.C. § 11711 and entitled “Dispute Settlement Program for Household Goods Carriers.” There were only three circumstances in which the shipper-plaintiff could recover attorneys’ fees in court: (1) where the carrier failed to provide a dispute settlement program (i.e. arbitration) so court was the only forum for relief; (2) where there was a dispute settlement program but it did not produce a timely decision; or (3) where there was a dispute settlement program and a decision, but the carrier did not comply necessitating a court action for enforcement of the decision. As the House Report described Section 7, its purpose was:
To encourage carriers to establish dispute settlement programs,  the section provides for the award of attorney’s fees to the successful shipper claimant where no program was available for use by the shipper to resolve the dispute. To encourage carriers to expeditiously settle disputes under the programs,  the section also provides for the award of attorney’s fees to the successful shipper claimant where a decision was not rendered within the time frame, or the extension thereof as provided under the program. Finally, to encourage carriers to comply with the decisions issued under the programs,  the section provides for the award of attorney’s fees to the successful shipper claimant who brought court action to enforce the decision issued under the program.
H.R. Rep. No. 96-1372, at 12(1980), reprinted in 1980 U.S.C.C.A.N. 4282-83. [endnote 1]
As set forth in 49 U.S.C. § 11711(a)(1)(1995)(emphasis added), whether to provide a dispute settlement program was at that time optional or discretionary with a regulated carrier: “One or more motor common carriers . . . who want to establish a program to settle disputes . . . may submit an application . . . to the Commission.” If such a settlement dispute program were established, then it would be approved by the Commission only if it satisfied the requirements of subsection (b) of the statute. 49 U.S.C. § 11711(a)(2)(1995). With some variation in language and distinctions (to be discussed further below and in the Addendum), the requirements of 49 U.S.C. § 11711(b) essentially track the same elements of the arbitration requirements under the current statute. See 49 U.S.C. § 14708(b). The three conditions under which a prevailing shipper-claimant could obtain attorneys’ fees in a court action were set forth in 49 U.S.C. § 11711(d)(3)(1995). Tracking the quoted portion of the House Report set forth above, the statute identified those three circumstances: (1) where no dispute settlement program was available; (2) where there was such a program, but it did not produce a decision within the time specified; or (3) where there was a dispute settlement program, but the court proceeding was to enforce the program’s decision because the carrier had not timely complied with the decision. 49 U.S.C. § 11711(d)(3)(A), (B), & (C)(1995). [endnote 2]
C. 1995 Termination Act
Over a period of years, Congress determined to and began deregulating the rail and motor carrier industries. Part of that process involved eliminating the Interstate Commerce Commission and transferring responsibility for its remaining regulatory functions from the Commissioner of the ICC to the Secretary of the Department of Transportation. This process was substantially completed by the ICC Termination Act of 1995. H.R. Rep. No. 104-311, at 82-85 & 91-93 (1995), reprinted in 1995 U.S.C.C.A.N. 793-97 & 803-05 (regarding P.L. 104-88). The previously discretionary provision for dispute settlement programs under former 49 U.S.C. § 11711 was replaced by a mandatory dispute settlement program when recodified at 49 U.S.C. § 14708 (still entitled “Dispute Settlement Program for Household Goods Carriers”). As this section was described in the House Report:
This section modifies the current arbitration provisions by requiring all household goods carriers to offer shippers the option of neutral arbitration as a means of settling disputes over household goods transportation involving individual householders as a condition of registration. This arbitration system is intended to afford consumers a forum to resolve loss and damage claims that may arise as part of the transportation of household goods. For claims of $1,000 and less [endnote 3], if a shipper requests arbitration, it shall be binding on both parties. For claims in excess of $1,000, then both the carrier and the shipper must agree to arbitrate the dispute.
This provision is intended to replace the informal dispute resolution activities of current ICC employees.
H.R. Rep. No. 104-311, at 121(1995), reprinted in 1995 U.S.C.C.A.N. 833 (emphasis added).
Thus, whereas the former statute made the provision for a dispute settlement program an option for a regulated carrier, the revised statute mandated as a condition of registration of the carrier that it had to offer a dispute settlement program complying with the requirements of the statute.
Sec. 14708. Dispute settlement program for household goods carriers. This section modifies the current arbitration provisions by requiring all household goods carriers to offer shippers the option of neutral arbitration as a means of settling disputes over household goods transportation involving individual householders. If a shipper requests arbitration, and the dispute involves a claim for $1,000 or less, it shall be binding on both parties. If the dispute involves a claim for more than $1,000, the arbitration shall be binding only if the carrier agrees to arbitration. The arbitrator may determine which party shall pay the cost or portion of the arbitration proceedings. Certain other procedures and requirements are set forth in this section, as well as Secretarial review within 36 months.
Sec. 14708 (Dispute settlement program for household goods carriers) modifies the existing arbitration provisions of 49 U.S.C. § 11711, by requiring all household goods carriers to offer shippers the option of neutral arbitration as a means of settling disputes over household goods transportation.
H.R. Rep. No. 104-422, at 223-24 (1995), reprinted in 1995 U.S.C.C.A.N. 908-09 (emphasis added).
As now codified at 49 U.S.C. § 14708(a), the statute eliminates the language making provision for a dispute settlement program permissive and instead requires it to be offered as a condition of registration. [endnote 4] The permissive language (“may”) from the former 49 U.S.C. § 11711(b) merely conditioning ICC approval of a program on compliance with the statutory requirements was replaced by 49 U.S.C. § 14708(b) which simply identifies the elements as “arbitration requirements.” Most of the program requirements of former 49 U.S.C. § 11711(b) were carried over into 49 U.S.C. § 14708(b). A comparison table is provided in the Addendum to this brief. With a notable exception, the attorneys’ fee provisions of former 49 U.S.C. § 11711(d) were carried over into 49 U.S.C. § 14708(d). The notable exception is the elimination of the element which was set forth in the former 49 U.S.C. § 11711(d)(3)(A). Since providing a dispute settlement program was required as a condition of registration, and not optional, that condition to an award of attorneys’ fees was superfluous.
As in the case of the 1980 amendments, with the 1995 amendments Congress still intended to encourage dispute resolution by arbitration, rather than resort to courts. [endnote 5] As set forth in the December 22, 1995 minutes of the House Committee on Transportation and Infrastructure Works in Bipartisan Manner:
In addition, the bill provides household-goods shippers with access to arbitration for disputed claims. This option will encourage equitable resolution of damage claims, eliminate Federal Government involvement in individual disputes, and minimize reliance on the courts.
104 Cong. Rec. H15605 (daily ed. Dec. 22, 1995)(Statement of Rep. Oberstar).
III. Predicate For Fees Absent
There is no provision for any award of attorney fees in connection with a property damage claim pursuant to the Carmack Amendment, except as provided in 49 U.S.C. § 14708, entitled Dispute Settlement Program for Household Goods Carriers. [endnote 6] There are three parts of 49 U.S.C. § 14708(d), all of which must be satisfied for a shipper to be eligible for an award of attorneys’ fees. The elements of 49 U.S.C. § 14708(d)(1) and (d)(2) are not in issue here. Carrier has not challenged that those two parts are satisfied. The requirements of 49 U.S.C. § 14708(d)(3), however, were not satisfied.
That third requirement for a shipper to receive an attorney fee award is satisfied if:
(A) a decision resolving the dispute was not rendered through arbitration under this section within the period provided under subsection (b)(8) of this section or an extension of such period under such subsection; or
(B) the court proceeding is to enforce a decision rendered through arbitration under this section and is instituted after the period for performance under such decision has elapsed.
49 U.S.C. § 14708(d)(3). It is undisputed that Shipper did not request any arbitration, so subsection (d)(3)(B) was not satisfied. Whether fees could be awarded turns on whether subsection (d)(3)(A) was satisfied.
Shipper urged below that subsection (d)(3)(A) is satisfied by reading only the first ten words of that part of the statute: “a decision resolving the dispute was not rendered through arbitration.” The district court agreed with Shipper that, since Shipper never invoked the Carrier’s arbitration program, a decision had not been rendered through arbitration, and the statutory condition was satisfied.
Shipper’s interpretation of the statute ignores its purpose (further addressed below) and ignores the additional language in subsection (d)(3)(A), which is fully quoted above. The focus of subsection (d)(3)(A) is whether an arbitration decision has been timely rendered. If a shipper-claimant has invoked the arbitration program, but the arbitrator fails to render a decision within the 60-day period (or within the reasonable extension of the 60-day period as permitted by the statute), then the shipper has not received a timely arbitration decision and is entitled to an attorney fee award upon resorting to the court. If Shipper’s truncation of the language of (d)(3)(A) were correct, then a shipper could skip the arbitration program specified by 49 U.S.C. § 14708(b), but still get a fee award under 49 U.S.C. § 14708(d). [endnote 7] There would be no purpose to the rest of the language in subsection (d)(3)(A). The language of subsection (d)(3)(A) does not stop at “arbitration,” though. The specified condition of subsection (d)(3)(A) is that an arbitration decision has not been rendered within the period provided by subsection (b)(8), and subsection (b)(8) calls for a decision by an arbitrator within 60 days of the arbitrator receiving notification of the dispute. By failing to utilize the arbitration program at all, a shipper-claimant prevents that condition from ever being satisfied. In that situation the shipper has not caused an arbitrator to receive notification of the dispute, the 60-day period of subsection (b)(8) is not initiated, and the condition of subsection (d)(3)(A) that an arbitration decision not have been rendered within the 60-day period is not satisfied because the shipper has prevented that 60-day period from ever running.
It is the position of the Carrier defendants that 49 U.S.C. § 14708 requires a carrier to have an arbitration program and only permits an award of attorney fees in a court action if the shipper-claimant has utilized the arbitration program and either the arbitration decision was not timely rendered or the carrier has not timely complied with the decision rendered. In other words, using (or attempting to use) the available dispute settlement program is a condition to seeking a fee award pursuant to the Dispute Settlement Program for Household Goods Carrier statute. Carrier maintains that the failure of Shipper to have utilized the arbitration program precluded any award of attorney fees.
Whether the statutory prerequisites for an award of attorneys’ fees were met was an issue in Ward v. Allied Van Lines, Inc., 231 F.3d 135 (4th Cir. 2000). The Fourth Circuit implied, but did not directly state, that attorneys’ fees may not be awarded under the current statute where the shipper-claimant fails to utilize an available arbitration program. That issue was not decided because, while the lawsuit was commenced after December 29, 1995 (the initial effective date of the ICC Termination Act of 1995, later amended to January 1, 1996), the claim arose before then, at a time when the statute did not require carriers to have an arbitration program.
A carrier of household goods is now required to offer neutral arbitration as a means of settling these disputes, and the carrier must give the shipper notice of the availability of arbitration “before such goods are tendered to the carrier for transportation.” 49 U.S.C. § 14708(b)(2). If a claim for damaged or lost goods is arbitrated to a timely, but non-binding, conclusion, the shipper cannot recover attorneys’ fees in a subsequent court action against the carrier. See id. § 14708(d). The question is whether the new statute can be applied to award fees to the Wards because Allied did not make arbitration, or notice of it, available to the Wards, even though an arbitration program was not required when the goods were transported.
Id. at 141 (footnote omitted). The Fourth Circuit decided the case under the “old” statute, 49 U.S.C. § 11711 (1995), which only permitted an award of fees to a shipper-claimant who failed to utilize an arbitration program because no such program was available. While Allied had such a program, it had not given notice of it to Ward and the fee award statutory prerequisites were found to exist.
Because the Wards were not given notice, the district court held that no dispute settlement program was available to the Wards, and § 11711(d)(3) was satisfied. We agree with the district court. Allied was obligated to give the Wards notice of the availability of the settlement program, and their lack of knowledge rendered the program unavailable to them.
Id. at 142.
The attorney fee statute was considered by a state appellate court in Collins Moving & Storage Corp. v. Kirkell, 867 So. 2d 1179 (Fla. Dist. Ct. App. 2004). That case was decided under the then current version of the statute, which required all carriers to have a settlement dispute arbitration program. Although the carrier in that case had failed to give notice of the availability of its arbitration program, the shipper-claimants were nevertheless aware of it, but brought the lawsuit without first utilizing the arbitration program. The shipper-claimants convinced the trial court that, since they had not utilized the arbitration program, the statutory condition was necessarily satisfied that a decision not have been rendered through arbitration. The appellate court held otherwise and reversed the fee award.
The [shipper-claimant] Kirkells contend that, since the matter was not submitted to arbitration, a “decision resolving the dispute was not rendered through arbitration . . .” 49 U.S.C. § 14708(d)(3)(A) and therefore attorney fees should be awarded.
. . .
We disagree with the Kirkells’ contention that, since a decision regarding this claim was not rendered through arbitration, they have satisfied the requirements of 49 U.S.C. § 14708(d)(3)(A). Section 14708 is a separate statutory provision entitled “Dispute settlement program for household goods carriers.” The provision authorizing an award of attorney’s fees under section 14708 would come into play only in a case in which a party had invoked the alternative dispute resolution provisions of section 14708. In this case neither of the parties did so and accordingly section 14708 is not applicable.
Id. at 1183 (emphasis added). Since “there is no provision for attorney fees” elsewhere in the Carmack Amendment (id.), and the shipper-claimants had not invoked the arbitration program provided pursuant to 49 U.S.C. § 14708, the only statute which did provide for attorneys’ fees, the appellate court reversed the award of fees. Id. at 1184.
It is clear that the 1980 amendments to the Carmack Amendment were intended to encourage arbitration, rather than litigation, of claims. [endnote 8] Whether a regulated carrier provided arbitration as a dispute settlement program was made optional. 49 U.S.C. § 11711(a)(1)(1995). A carrier providing such a program was to submit it for approval, which approval was conditioned upon the program satisfying the statute’s arbitration requirements. Id. (a)(2). The statute then specified 8 categories of arbitration requirements intended to make any such voluntarily provided program meaningful for the shipper-claimant Id. (b)(1)-(8). To encourage carriers to provide the voluntary arbitration program, attorneys’ fees, which were not previously awardable for such claims, were made awardable in a court action if no approved arbitration program was available. Id. (d)(3)(A). Alternatively, court awarded attorneys’ fees could be obtained if the shipper-claimant had invoked a carrier-provided arbitration program, but the decision was not rendered within the time limit specified by the statute, prompting the court action by the shipper. Id. (d)(3)(B). Finally, court awarded attorneys’ fees could be obtained if the shipper-claimant had invoked a carrier-provided arbitration program and the decision was timely rendered, but the carrier did not timely comply so the court action was to enforce the decision. Id. (d)(3)(C). With respect to court awarded attorney fees to a carrier, consistent with the statute’s intent to encourage shippers to utilize a carrier-provided arbitration program, all of the conditions for a fee award are based upon the shipper having previously invoked the arbitration program. Id.(e). Reciprocity exists in that, upon prevailing, either party may be able to obtain a fee award only if the arbitration program was utilized. These provisions were all consistent with the Congressional intent discussed above (supra at 9-16) and set forth in a statute entitled: “Dispute Settlement Program for Household Goods Carriers.”
The 1995 amendments are consistent with that same intent to encourage arbitration, rather than litigation. Instead of making provision by a carrier of an arbitration program optional, the statute now requires it as a condition of registration. 49 U.S.C. § 14708(a). Since providing a program with specifically described elements was made mandatory, the statute no longer needed to describe a submission and approval process. As with the former statute, the current statute specifies 8 categories of arbitration requirements intended to make the program meaningful for the shipper-claimant. While some of the language is slightly different, each of the those categories performs the same function as in the former statute. Id. (b)(1)-(8). Attorneys’ fees are addressed in 49 U.S.C. § 14708(d). Except for the elimination of the element that an approved arbitration program be available (49 U.S.C. § 11711(d)(3)(A)), because now providing the program is mandatory, the other alternative elements are re-numbered and preserved in the new statute. Thus, court awarded attorneys’ fees may be obtained if the shipper-claimant has invoked the arbitration program, but no decision was rendered within the time limit specified by the statute. 49 U.S.C. § 14708(d)(3)(A). Alternatively, court awarded attorneys’ fees may be obtained if the shipper-claimant has invoked the arbitration program, and a decision was timely rendered, but the carrier did not timely comply so the court action was necessary to enforce the decision. Id. (d)(3)(B). With respect to court awarded attorney fees to a carrier, consistent with the provisions of the former statute, all of the conditions are based upon the shipper having previously invoked the arbitration program. Id.(e). As with the former statute, the current one remains entitled: “Dispute Settlement Program for Household Goods Carriers.”
The legislative history for the 1995 amendments only identifies changing the arbitration program from optional to mandatory as the intended modification with respect to this statute. [endnote 9] It is fair to assume that the stated intent in creating the 1980 statute, to encourage arbitration rather than litigation, remained with the 1995 amendment. The modification is consistent with that intent. Moreover, the position of Shipper, which the district court accepted, is not consistent with the purpose underlying the statute. Shipper’s interpretation of the statute defeats the purpose of encouraging arbitration. If a shipper-claimant cannot receive fees in a court action, unless the shipper has invoked the arbitration program (and then not received a timely decision or the carrier has not timely complied with an arbitration decision), then the shipper will be encouraged to take advantage of the arbitration program or know that court awarded fees are not available. If the shipper-claimant need not invoke the statute’s arbitration program at all to be eligible for an attorneys’ fee award under the same statute, the incentive to use the program is eliminated. Additionally, Shipper is parsing 49 U.S.C. § 14708 (d)(3)(A) to argue that the condition is merely that a decision through arbitration has not been rendered, [endnote 10] when the language is that “a decision resolving the dispute was not rendered through arbitration under this section within the period provided under subsection (b)(8) of this section.” Id. The language contemplates that an arbitration has occurred and the operative words are those ignored by Shipper to the effect that a decision in such an arbitration has not been timely rendered. Finally, examination of the portion of the statute permitting a fee award to a carrier successfully defeating a shipper’s claim shows such an award is only contemplated where the arbitration program has been invoked, suggesting a consistent intent with the portion addressing fee awards to shippers. Id.(e). Reciprocity exists only if the shipper also must utilize the arbitration program to be eligible for a fee award. If not, then by avoiding it, the shipper may unilaterally place itself in a position where only the shipper may obtain a fee award. That would be an unreasonable construction of the statute and inconsistent with the legislative intent. The reasonable construction of 49 U.S.C. § 14708(d) is that invoking the arbitration program is a condition to receiving a fee award and Shipper’s failure to do so here precluded any fee award. The predicate for fees being absent, the district court should not have awarded attorney fees.
An attorneys’ fee award may be made to a shipper-claimant in a Carmack Amendment action only if the shipper has first invoked the statutorily required arbitration program. In this case, Shipper did not utilize the available arbitration program, so the district court should not have awarded attorney fees. As stated at the outset, this position by the appellant was rejected by the Ninth Circuit Court of Appeals in Campbell v. Allied Van Lines, 410 F.3d 618 (9th Cir. 2005)(see dissent, however). Shortly thereafter, though, Congress amended 49 U.S.C. § 14708(a).
[T]he Household Goods Transportation Act proposed that shippers provide arbitration and dispute resolution programs so that customers could recover damages without going to court. . . .
In order to “encourage” carriers to make dispute settlement programs available, the Household Goods Transportation Act stipulated that common carriers who did not make a dispute resolution program available would be liable for attorney’s fees if a customer prevailed on his claim.
Trepel v. Roadway Express, Inc., 266 F.3d 418, 421 (6th Cir. 2001)(decided under 49 U.S.C. § 11711).
2. “In order to recover attorney’s fees, Plaintiffs are also required to establish that a dispute settlement program was not available or that a decision resolving the dispute was not issued within the time period provided under subsection (b)(8).” Tayloe v. Kachina Moving & Storage, Inc., 16 F. Supp. 2d 1123, 1133 (D. Ariz. 1998)(decided under 49 U.S.C. § 11711).
3. As currently codified (pursuant to 1999 amendment), that arbitration amount is at $5,000, rather than $1,000. 49 U.S.C. § 14708(b)(6).
4. “A carrier of household goods is now required to offer neutral arbitration as a means of settling these disputes.” Ward v. Allied Van Lines, Inc., 231 F.3d 135, 141 (4th Cir. 2000). “The old statute simply encouraged carriers of household goods to ‘establish a program to settle disputes between such carriers and shippers’ of those goods.” Id. n2.
5. “Current provisions allowing such fees in cases within the scope of the Carmack Amendment, see 49 U.S.C. § 14708, are merely a recodification (with slight alteration) of provisions in effect since 1982. See 49 U.S.C. § 11711 (1995).” Morris v. Covan World Wide Moving, Inc., 144 F.3d 377, 383 n.4 (5th Cir. 1998).
Effective January 1, 1996, the Carmack Amendment was recodified at 49 U.S.C. § 14706 from 49 U.S.C. § 11701(1995), by the ICC Termination Act of 1995, Pub. L. No. 104-88, 109 Stat. 803 (1995) by which reorganized the Interstate Commerce Act by eliminating some provisions and relocating the remaining provisions to their places in Title 49. This recodification worked no substantive change on the Carmack Amendment.
Project Hope v. M/V IBN SINA, 250 F.3d 67, 73 n.4 (2d Cir. 2001)(emphasis added). “This revision [ICC Termination Act of 1995] worked no substantive change on the Carmack Amendment.” Molloy v. Allied Van Lines, Inc., 267 F. Supp. 2d 1246, 1251 n.3 (M.D. Fla. 2003). “That act [the ICC Termination Act of 1995] preserved the existing Carmack Amendment provisions governing carrier liability and recodified them at 49 U.S.C. § 14706.” Grigg v. Saia Motor Freight Line, Inc., 709 So. 2d 896, 898 (La. Ct. App. 1998). “The clear intent of Section 14708 is to foster arbitration in lieu of litigation.” G. Wright, “Slouching Toward a Morass: The Case for Preserving Complete Carmack Preemption,” 1 DePaul Bus. & Comm. L.J. 177, 207 (2003).
6. The title to a statute is a tool to ascertain Congressional intent. In re Cybernetic Services, Inc., 252 F.3d 1039, 1050 (9th Cir. 2001); Zimmerman v. Oregon Department of Justice, 170 F.3d 1169, 1175 (9th Cir. 1999).
7. At the same time, the shipper would be unilaterally precluding a carrier from recovery fees under subsection (e), even if it were a bad faith claim, because that subsection contemplates that an arbitration has occurred.
8. This historical context of the 1980 amendments is relevant in determining the meaning of the statute following the 1995 revision and recodification. “The meaning of a statute’s words can also be ‘enlightened by their context and the contemporaneous legislative history,’ as well as the ‘historical context of the statute.’ ” Walton v. Hammons, 192 F.3d 590, 594 (6th Cir. 1999)(quoting Edwards v. Aguillard, 482 U.S. 578, 594-95 (1987)).
9. “Under established canons of statutory construction, it will not be inferred that Congress, in revising and consolidating the laws, intended to change their effect unless such intention is clearly expressed.” Finley v. United States, 490 U.S. 545, 554 (1989). Accord Redmond-Issaquah Railroad Preservation Association v. Surface Transportation Board, 223 F.3d 1057, 1062 (9th Cir. 2000); In re Chateaugay Corp., 89 F.3d 942, 953 (2d Cir. 1996).
10. If Shipper’s reading were correct, then the same argument could have been made under the former version of the statute when it said: “a decision resolving the dispute was not rendered under a dispute settlement program.” The rest of the language in the subsection then, the context of the statute, and its legislative history all indicated that it was the timeliness of the decision that was operative and that a fee award was permitted only if the arbitration program were utilized, but the decision not timely rendered. The current version of the statute should be read consistent with that purpose.