ABB INC. v. CSX Transportation, Inc.

PUBLISHED

UNITED STATES COURT OF APPEALS
FOR THE FOURTH CIRCUIT

No. 12-1674

ABB INC.,

Plaintiff - Appellant,

v.

CSX TRANSPORTATION, INC.,

Defendant – Appellee,

------------------------------

TRANSPORTATION AND LOGISTICS COUNCIL, INC.,

Amicus Supporting Appellant.

Appeal from the United States District Court for the Eastern
District of North Carolina, at Raleigh. James C. Fox, Senior
District Judge. (5:08-cv-00025-F)

Argued: March 21, 2013 Decided: June 7, 2013

Before AGEE, KEENAN, and FLOYD, Circuit Judges.

Vacated in part and remanded by published opinion. Judge Keenan
wrote the opinion, in which Judge Floyd joined. Judge Agee
wrote a separate opinion concurring in part and dissenting in
part.

ARGUED: Jeffrey Mark Young, ABB INC., Raleigh, North Carolina,
for Appellant. Hyman Hillenbrand, HILLENBRAND, O'BRIEN &
SOLOMON, LLP, Fort Lauderdale, Florida, for Appellee. ON BRIEF:
Dauna L. Bartley, SESSOMS & ROGERS, P.A., Durham, North
Carolina, for Appellant. Thomas D. Garlitz, THOMAS D. GARLITZ,
PLLC, Charlotte, North Carolina, for Appellee. Raymond A.
Selvaggio, PEZOLD, SMITH, HIRSCHMANN & SELVAGGIO, LLC,
Huntington, New York, for Amicus Supporting Appellant.

2
BARBARA MILANO KEENAN, Circuit Judge:

In March 2006, rail carrier CSX Transportation, Inc. (CSX)

transported an electrical transformer worth about $1.3 million

from shipper ABB Inc.’s plant in St. Louis, Missouri to a

customer in Pittsburgh, Pennsylvania (the March 2006 shipment).

ABB Inc. (ABB) later filed a complaint in the district court

alleging that the transformer was damaged in transit, and that

CSX was liable for over $550,000, the full amount of the damage.

CSX denied full liability, and alternatively contended that even

if the court found CSX liable for the cargo damage, the parties

had agreed in the bill of lading to limit CSX’s liability to a

maximum of $25,000.

The district court held that the parties had limited CSX’s

potential liability in the bill of lading to $25,000. The

parties thereafter entered into a consent judgment, reserving

ABB’s right to appeal the district court’s resolution of the

liability limit issue. Upon our review, we conclude that the

Carmack Amendment to the Interstate Commerce Act, 49 U.S.C.

§ 11706, subjected CSX to full liability for the shipment, and

that the parties did not modify CSX’s level of liability by

written agreement as permitted in that statute. We therefore

vacate the portion of the district court’s judgment limiting any

liability on the part of CSX to $25,000.

3
 I.

We begin with a discussion of the complex regulatory scheme

governing interstate freight shipments, and the historical

context in which the shipment in this case occurred. We also

address the role of the Carmack Amendment, which restricts

carriers’ ability to limit their liability for cargo damage.

A.

In 1887, Congress enacted the Interstate Commerce Act

(ICA), 24 Stat. 379, to regulate the transportation industry.

Emerson Elec. Supply Co. v. Estes Express Lines Corp., 451 F.3d

179, 183 (3d Cir. 2006). The Interstate Commerce Commission

(ICC) initially was designated to administer this regulatory

regime, but was replaced in 1995 by the Surface Transportation

Board. Id. at 183, 186; ICC Termination Act of 1995, Pub. L.

No. 104-88, 109 Stat. 803, 932-34. Among other things, the ICC

“regulated the railroad industry by requiring rates to be

‘reasonable and just’ and prohibited certain railroad practices,

such as rate discrimination [and] price fixing,” and eventually

expanded to include the regulation of motor vehicle

transportation. Emerson, 451 F.3d at 183.

Until 1995, carriers were required to file their rates, or

“tariffs,” publicly with the ICC. Tempel Steel Corp. v.

Landstar Inway, Inc., 211 F.3d 1029, 1030 (7th Cir. 2000);

4
Comsource Indep. Foodserv. Cos. v. Union Pac. R.R., 102 F.3d

438, 442 (9th Cir. 1996). Under this scheme, “the filed rate

govern[ed] the legal relationship between shipper and carrier,”

and the carrier could not deviate from the published tariff.

Maislin Indus., U.S. v. Primary Steel, 497 U.S. 116, 119-20, 126

(1990). For these reasons, shippers and carriers generally were

charged with notice of the terms that were required to be

included in the carrier’s published tariffs. See id. at 127

(citing Louisville & Nashville R.R. Co. v. Maxwell, 237 U.S. 94

(1915)).

In 1995, in an effort to ease regulatory burdens on the

transportation industry, Congress abolished the requirement that

tariffs be filed as public documents. ICC Termination Act of

1995, Pub. L. No. 104-88, 109 Stat. 803; Tempel Steel Corp., 211

F.3d at 1030. The term “tariff,” even when still used by

shippers and carriers “out of habit,” is now merely a

contractual term with “no effect apart from [its] status as [a]

contract[].” 1 Tempel Steel Corp., 211 F.3d at 1030.

1
At the time of the 1995 deregulation, Congress imposed on
rail carriers a new obligation to make their rates available to
shippers, in lieu of the public-filing requirement. ICC
Termination Act of 1995, Pub. L. No. 104-88, 109 Stat. 803, 830
(codified at 49 U.S.C. § 11101). Section 11101(b) provides:

A rail carrier shall also provide to any person, on
request, the carrier’s rates and other service terms.
(Continued)
5
 B.

The Carmack Amendment, 49 U.S.C. § 11706, 2 originally

enacted in 1906 as an amendment to the ICA, “creates a national

scheme of carrier liability for goods damaged or lost during

interstate shipment under a valid bill of lading.” 3 5K

Logistics, Inc. v. Daily Express, Inc., 659 F.3d 331, 335 (4th

Cir. 2011) (citation and internal quotation marks omitted). The

statute requires that a rail carrier issue a bill of lading for

property it transports, and that a carrier is liable to the

“person entitled to recover” under the bill of lading “for the

The response by a rail carrier to a request for the
carrier’s rates and other service terms shall be—

(1) in writing and forwarded to the
requesting person promptly after receipt of
the request; or

(2) promptly made available in electronic
form.
2
This appeal involves rail carriers, which are subject to
the provisions of 49 U.S.C. § 11706. Today, motor carriers are
also subject to a separate provision of the Carmack Amendment,
codified at 49 U.S.C. § 14706.
3
A bill of lading “records that a carrier has received
goods from the party that wishes to ship them, states the terms
of carriage, and serves as evidence of the contract for
carriage.” Norfolk S. Ry. v. James N. Kirby, Pty Ltd., 543 U.S.
14, 18-19 (2004).

6
actual loss or injury to the property” caused by a carrier. 4 49

U.S.C. § 11706(a). The Carmack Amendment specifies that

“[f]ailure to issue a receipt or bill of lading does not affect

the liability of a rail carrier.” Id.

Subsection (c) of the statute provides only a limited

exception to full carrier liability:

(1) A rail carrier may not limit or be exempt
from liability imposed under subsection (a) of
this section except as provided in this
subsection. A limitation of liability or of the
amount of recovery or representation or agreement
in a receipt, bill of lading, contract, or rule
in violation of this section is void. . . .

(3) A rail carrier providing transportation or
service subject to the jurisdiction of the Board
under this part may establish rates for
transportation of property under which—

(A) the liability of the rail carrier for
such property is limited to a value
established by written declaration of the
shipper or by a written agreement between
the shipper and the carrier. . . .

49 U.S.C. § 11706(c) (emphasis added). In other words, the

Carmack Amendment “constrains carriers’ ability to limit

liability by contract,” Kawasaki Kisen Kaisha Ltd. v. Regal-

Beloit Corp., 130 S. Ct. 2433, 2441 (2010), by requiring that a

4
To establish a prima facie case of carrier liability under
the Carmack Amendment, a shipper must show (1) delivery of the
goods to the carrier in good condition; (2) the cargo’s arrival
in damaged condition; and (3) the amount of damages. Oak Hall
Cap & Gown Co. v. Old Dominion Freight Line, Inc., 899 F.2d 291,
294 (4th Cir. 1990).

7
rail carrier remains fully liable for damage caused to its

freight unless the shipper has agreed otherwise in writing. 49

U.S.C. § 11706(a), (c); see also Emerson, 451 F.3d at 186 (“[A]

carrier’s ability to limit [its] liability is a carefully

defined exception to the Carmack Amendment’s general objective

of imposing full liability for the loss of shipped goods.”)

(quoting Carmana Designs Ltd. v. N. Am. Van Lines, Inc., 943

F.2d 316, 319 (3d Cir. 1991)) (internal quotation marks

omitted). 5 The Carmack Amendment thus protects shippers from

attempts by carriers to avoid liability for damage to cargo

under the carriers’ control, and “relieve[s] cargo owners of the

burden of searching out a particular negligent carrier from

among the often numerous carriers handling an interstate

shipment of goods.” Kawasaki, 130 S. Ct. at 2441 (citation

omitted).

To determine whether a carrier has limited its liability

consistent with the strictures of the Carmack Amendment, courts

5
In this opinion, we reference cases involving the
transportation of goods by motor vehicles under Section 14706,
as well as cases involving rail carriers under Section 11706.
As relevant here, pursuant to Section 14706, motor carriers are
by default liable for “the actual loss or injury to the property
caused” by the carrier, but the carrier’s liability may be
limited “to a value established by written or electronic
declaration of the shipper or by written agreement between the
carrier and shipper if that value would be reasonable under the
circumstances surrounding the transportation.” 49 U.S.C. §
14706(a)(1), (c)(1)(A).

8
have applied a four-part test, under which carriers must: (1)

provide the shipper, upon request, a copy of its rate schedule; 6

(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.” OneBeacon Ins. Co. v. Haas

Indus., 634 F.3d 1092, 1099-1100 (9th Cir. 2011); see also

Chandler v. Aero Mayflower Transit Co., 374 F.2d 129, 137 (4th

Cir. 1967) (explaining the requirement of “reasonable notice” to

choose between levels of liability). The Carmack Amendment’s

exception allowing for limited liability is “a very narrow

exception to the general rule” imposing full liability on the

carrier. Toledo Ticket Co. v. Roadway Express, 133 F.3d 439,

442 (6th Cir. 1998) (citing Carmack Amendment for motor

carriers, as previously codified at 49 U.S.C. § 10730). Courts

“will [] carefully scrutinize[]” any alleged limitation of

liability “to assure that the shipper was given a meaningful

choice and exercised it as evidenced by a writing.” Acro

6
Before deregulation, the first part of this test required
that the carrier have maintained a tariff with the ICC.
OneBeacon Ins. Co. v. Haas Indus., 634 F.3d 1092, 1099 (9th Cir.
2011) (citing Hughes Aircraft Co. v. N. Am. Van Lines, 970 F.2d
609, 611-12 (9th Cir. 1992)).

9
Automation Sys. v. Iscont Shipping, 706 F. Supp. 413, 416 (D.

Md. 1989).

II.

In its complaint filed against CSX, ABB alleged that CSX

was liable for the “actual loss or injury arising from the

damage to the [t]ransformer” under the Carmack Amendment. ABB

also asserted state law claims for negligence and breach of

contract.

CSX did not admit liability, but raised as an affirmative

defense that any liability on its part was limited to a maximum

of $25,000. 7 CSX argued that the bill of lading (BOL) executed

by ABB had incorporated by reference a $25,000 liability

limitation contained in a separate price list used by CSX.

The district court did not consider the issue whether ABB

had established a prima facie case of liability against CSX but,

on submissions by the parties, proceeded to consider the

liability limitation issue. The court awarded summary judgment

to CSX based on its defense that it had limited its liability.

The court also reasoned that the Carmack Amendment did not apply

to the shipment because the shipper, rather than the carrier,

7
CSX also argued in the district court that the parties had
entered into a private shipping contract governed by 49 U.S.C.
§ 10709, but assumed for purposes of summary judgment that the
shipment was subject to the Carmack Amendment.

10
had drafted the BOL. Pursuant to the consent judgment entered

into by the parties, ABB timely appealed from the district

court’s determination regarding CSX’s limitation of liability. 8

Before beginning our analysis of the Carmack Amendment, we

describe the two documents central to our resolution of this

appeal. First, the BOL governing the March 2006 shipment is a

partially completed copy of ABB’s standardized bill of lading.

The BOL included general information about the shipment, such as

the date of transport, pick-up and destination locations, and

scheduled transportation route. In the space on the form

labeled “product value,” ABB’s traffic manager, Brian

Brueggeman, entered “$1,384,000.” Although the box labeled

“prepaid” (compared with “collect”) was marked, the BOL did not

include a price for the shipment or indicate the level of

liability assumed by CSX for lost or damaged cargo. 9 The space

labeled “rate authority” was left blank, as was the box that

included the following pre-printed language:

8
The district court also dismissed ABB’s state law claims,
which decision is not at issue in this appeal.
9
In his deposition testimony, Brueggeman stated that he
thought that ABB would receive full liability coverage by
declaring the value of the transformer in the body of the BOL,
although he did not include a notation to this effect in the
document.

11
 NOTE – Where the rate is dependent on value, shippers
are required to state specifically in writing the
agreed or declared value of the property.

The agreed or declared value of the property is hereby
specifically stated by the shipper to be not exceeding
$___. 10

The BOL also included certification language, which

provided in part:

It is mutually agreed . . . that every service to be
performed hereunder shall be subject to all the terms
and conditions the Uniform Domestic Straight Bill of
Lading set forth . . . in Uniform Freight
Classification in effect on the date hereof, if this
is a rail or a rail-water shipment . . .

Shipper hereby certifies that he is familiar with all
the terms and conditions of the said bill of lading,
including those on the back thereof, set forth in the
classification or tariff which governs the
transportation of this shipment, and the said terms
and conditions are hereby agreed to by the shipper and
accepted for himself and his assigns.

(emphasis added). 11 The BOL was signed by Brueggeman.

The second document at issue in this appeal is CSX Price

List 4605, which was “issued” by CSX on November 18, 2005 and

became “effective” on December 14, 2005. This twelve-page

10
ABB employees were unable to edit or enter any
information into this “declared value box” due to a feature of
the computer program.
11
In addition to the reference to a “tariff” in the
certification, the following language appeared at the top of the
BOL: “RECEIVED Subject to the Classifications and Lawfully filed
tariffs in effect on the date of the issue of this Bill of
Lading” (emphasis added).

12
document sets forth numerous rules applicable to CSX’s

transportation of machinery, such as, for example, procedures

related to billing and to the loading and unloading of cargo.

Relevant to this appeal is the section of Price List 4605

entitled “price restrictions.” This section lists eighteen

provisions, including the following:

Carriers’ maximum liability for lading loss or damage
will not exceed $25,000 per shipment. Full liability
coverage is only available by calling your sales
representative for a specific quote.

CSX’s corporate representative, Joseph McCauley, testified in

his deposition that Price List 4605 does not provide varying

rates associated with different levels of liability, and that in

order to receive coverage for full liability under the list, a

shipper must negotiate a rate directly with the carrier.

Neither Brueggeman nor his predecessor in ABB’s traffic

manager position, Craig Steffey, was aware of the existence of

Price List 4605 prior to the March 2006 shipment. During his

tenure, Steffey had obtained rate information from CSX by

contacting the carrier directly and obtaining a quote specific

to the intended shipment.

With respect to the March 2006 shipment at issue in this

appeal, Brueggeman sought rate information on multiple occasions

13
without success from CSX personnel and from the CSX website, 12

and thus was unable to complete the space designated on the BOL

for the “rate authority.” 13 Brueggeman explained that because he

had been unable to obtain the rate authority in advance, he

would only learn the price of the shipment when he eventually

received an invoice from CSX.

III.

ABB argues that the district court erred in failing to

apply the Carmack Amendment to ABB’s shipment. According to

ABB, because the parties did not agree in writing to limit the

carrier’s liability, CSX is liable under the plain language of

the Carmack Amendment for the full value of the cargo damage.

In response, CSX argues that ABB, as the drafter of the

BOL, is not entitled to the protection of the Carmack Amendment

12
Although McCauley claimed that Price List 4605 was
available on the CSX website, Brueggeman testified that he could
not recall ever seeing a price list, despite “look[ing] all over
the website.” In any event, it is undisputed that shippers
could not request a full liability quote from CSX through the
website.
13
At oral argument and in portions of its briefing, CSX
appears to contest that Brueggeman attempted to obtain rate
information for the shipment. Yet elsewhere in its briefing,
CSX acknowledges that Brueggeman consulted the CSX website and
made inquiries to certain CSX personnel. Despite CSX’s
allusions to the contrary, the record clearly indicates that
Brueggeman affirmatively sought rate information from CSX, to no
avail.

14
and that, regardless, the BOL incorporated by reference the

limitation of liability included in Price List 4605. 14 We

disagree with CSX’s arguments.

We nevertheless observe at the outset that ABB’s problem in

this case is partly of its own making. The record reflects that

Brueggeman did not exercise due diligence in performing a key

aspect of his job, namely, negotiating and obtaining rate and

liability information for the shipment of very expensive

equipment. 15 We also recognize that ABB could have prevented

many of the problems that occurred in this case not only by

properly negotiating the shipping rate, but also by revising its

standardized bill of lading to exclude outdated references to

“tariffs” and “classifications” that were part of the pre-1995

regulatory scheme.

Despite ABB’s failures, however, the Carmack Amendment

imposed the burden of securing limited liability on the carrier,

CSX, not on the shipper, ABB. 49 U.S.C. § 11706; Acro

Automation Sys., 706 F. Supp. at 416. The plain language of the

14
Based on the facts of this case, we are not confronted
with a possible “written declaration of the shipper” as an
exception to the imposition of full liability under the Carmack
Amendment. 49 U.S.C. § 11706(c)(3)(A). Accordingly, we address
only the “written agreement” exception. Id.
15
We note that CSX’s conduct also was culpable, given CSX’s
lack of accessibility to shippers over an extended period of
time.

15
statute provides that in the absence of a clear, written

agreement by the shipper, the carrier is subject to full

liability for actual losses. See 49 U.S.C. § 11706(a), (c).

To overcome this default posture of full liability imposed

by the Carmack Amendment, the carrier and the shipper must have

a written agreement that is sufficiently specific to manifest

that the shipper in fact agreed to a limitation of liability.

“[A] carrier cannot limit liability by implication. There must

be an absolute, deliberate and well-informed choice by the

shipper.” Acro Automation Sys., 706 F. Supp. at 416 (citation

omitted). Without a rule requiring at least some specificity in

a written agreement, the shipper would not have “a reasonable

opportunity to choose between two or more levels of liability,”

OneBeacon Ins. Co., 634 F.3d at 1099, but instead would be

automatically and unwittingly subject to the carrier’s

unilateral choice of a rate authority. Cf. N.Y., New Haven &

Hartford R.R. Co. v. Nothnagle, 346 U.S. 128, 135-36 (1953)

(“Binding [the shipper] by a limitation which [the shipper] had

no reasonable opportunity to discover would effectively deprive

[the shipper] of the requisite choice; such an arrangement would

amount to a forbidden attempt to exonerate a carrier from the

consequences of its own negligent acts.”).

We disagree with the district court’s conclusion that, as a

general matter, the Carmack Amendment does not apply when the

16
shipper drafts the bill of lading. The text of the Carmack

Amendment imposes full liability on carriers, without regard to

which party prepared the bill of lading. The statute provides

that a carrier’s failure to issue a bill of lading “does not

affect the liability of a rail carrier.” 49 U.S.C. § 11706(a).

In this case, the parties did not reach a written agreement

to limit CSX’s liability and, accordingly, the Carmack Amendment

operated to impose full liability on CSX. On its face, the BOL

governing the March 2006 shipment was silent regarding the

extent of CSX’s liability. The space on the BOL labeled “rate

authority,” where a notation regarding rate and liability

normally would be listed, was left blank. Moreover, the BOL did

not contain any references to an identifiable classification, a

rate authority code, a price list, or any other indication that

the carrier assumed only limited liability.

CSX contends, nonetheless, that Price List 4605 is

incorporated by reference into the BOL through standardized

language appearing on the BOL, indicating that the shipper

agreed to the terms and conditions in “the classification or

tariff which governs the transportation of this shipment.” In

CSX’s view, this standardized language is adequate to meet the

“written agreement” exception for avoiding full liability under

the Carmack Amendment.

17
 We cannot endorse CSX’s position urging limited liability

under these circumstances, because the language in the BOL does

not specifically reference Price List 4605. Under CSX’s

proposed rule, shippers would be charged with notice of a

private price list created by the carrier, even when the list

was not filed for public inspection, the shipper had not

previously shipped cargo pursuant to that list, and the shipper

had sought the pricing information unsuccessfully from the

carrier before drafting the BOL. Under such a theory, the

shipper’s “knowledge” of the list could be proved solely by use

of the generic and outdated word “tariff” being employed as

standard language in a bill of lading.

Prior to deregulation, courts reasonably held shippers to

constructive knowledge of a published tariff based on a generic

reference to the tariff in a bill of lading. See Mech. Tech.

Inc., v. Ryder Truck Lines, Inc., 776 F.2d 1085, 1087-89 (2d

Cir. 1985). Today, however, carriers are not required to file

such public tariffs. Tempel Steel Corp., 211 F.3d at 1030. To

permit a carrier to assume that a shipper is familiar with a

carrier’s price list, without any manifestation of that

familiarity in the bill of lading or in an external agreement

limiting the carrier’s liability, would be contrary to the

Carmack Amendment’s command that a carrier may only limit

18
liability pursuant to an express, written agreement with the

shipper. 49 U.S.C. § 11706(c).

Extended to its logical extreme, CSX’s proposed rule would

encourage absurd results. One such example would be a situation

in which the bill of lading references a general “tariff,” but

does not specify a particular rate authority or other code

indicating the applicable rate and liability level. In the

absence of publicly filed tariffs, or a citation to a specific

rate authority or code, a carrier could change unilaterally its

level of liability, unbeknownst to the shipper, by altering its

price list a day before the shipment takes place.

Additionally, we observe that a decision in favor of CSX

would be required if Price List 4605 had been referenced

specifically in the BOL, even if ABB had not actually been aware

of the limitation of liability contained in that price list. In

such a circumstance, the shipper reasonably would be charged

with notice of the meaning of a precise, currently applicable

term that the shipper included in the BOL.

The Eleventh Circuit’s decision in Siren, Inc. v. Estes

Express Lines, 249 F.3d 1268 (11th Cir. 2001), on which the

district court and CSX have relied, is distinguishable on this

basis. In Siren, the shipper prepared the bill of lading and

noted twice that the shipment would move under “Class 85,” a

term understood in the trucking industry as limiting liability

19
to a certain amount per pound of cargo, although the shipper

maintained it had no actual knowledge that this class

designation provided such a limitation of liability. 249 F.3d

at 1269, 1272. Nevertheless, the shipper was aware that it had

received a significant discount from the carrier’s full

liability rate for the shipment in question, and that the rate

it received was based on the “Class 85” designation. Id. The

Eleventh Circuit concluded that, because “[the shipper] drafted

the bill of lading, [the shipper] chose to use the term ‘Class

85’, [the shipper] did not rebut [the carrier’s] assertion at

trial that ‘Class 85’ included a limiting aspect, [the shipper]

knew ‘Class 85’ determined the freight rate charged, and [the

shipper] knew that it received a 62% discount from [the] full

freight rate,” the shipper could not avoid the limitation of

liability it had included in the contract, because it was not

“proper or necessary to protect shippers from themselves.” Id.

at 1271, 1273.

We agree with the Eleventh Circuit’s determination that, by

including a specific class designation in the bill of lading,

the shipper was bound to the terms and conditions associated

with that class designation. Cf. Hughes Aircraft Co. v. N. Am.

Van Lines, Inc., 970 F.2d 609, 612 (9th Cir. 1992) (holding that

a shipper had “reasonable notice and an opportunity to make a

deliberate, thoughtful choice in selecting” a limit of liability

20
when the shipper drafted the bill of lading and negotiated its

terms). In the present case, however, the BOL is entirely

silent regarding any current rate, classification, or other

specific authority governing the shipment. There also is no

evidence that the parties had a written agreement establishing a

limit of liability separate from the BOL. Therefore, as

discussed above, we decline to conclude that a shipper should be

held to notice of a privately held price list based only on

generic and ambiguous language referencing a “tariff” or

“classification.” 16

Our conclusion that the parties did not agree to a

liability limitation is not altered by CSX’s reliance on its

16
We disagree with the dissent’s contention that the facts
of this case are “indistinguishable” from the facts in Werner
Enters. v. Westwind Mar. Int’l, Inc., 554 F.3d 1319 (11th Cir.
2009). Post at 30-32. In Werner, the invoice for the shipment
expressly notified the shipper of the potential for a limitation
of liability. The invoice provided:

Third parties to whom the goods are entrusted may
limit liability for loss or damage; the Company will
request excess valuation coverage only upon specific
written instructions from the Customer, which must
agree to pay any charges therefore; in the absence of
written instructions or the refusal of the third party
to agree to a higher declared value, at Company's
discretion, the goods may be tendered to the third
party, subject to the terms of the third party's
limitations of liability and/or terms and conditions
of service.

554 F.3d at 1322. In the present case, however, the BOL did not
contain any such limiting language. In light of this material
distinction, we conclude that Werner is inapposite.

21
past course of dealing with ABB. The Carmack Amendment’s

requirement of a written agreement undermines CSX’s argument

that the parties’ alleged course of dealing can serve as a

substitute for a written limitation of liability for a

particular shipment. See Mooney v. Farrell Lines, Inc., 616

F.2d 619, 626 (2d Cir. 1980) (declining to limit a carrier’s

liability by evidence of the parties’ course of dealing, when

the liability limit was not included in the bill of lading); cf.

Camar Corp. v. Preston Trucking Co., 18 F. Supp. 2d 112, 115 (D.

Mass. 1998) (rejecting argument that the shipper’s

sophistication and the parties’ course of dealing evidenced an

“absolute, deliberate and well-informed choice by the shipper”

to limit the carrier’s liability, in the absence of a bill of

lading or other written agreement).

Moreover, the present record lacks any evidence that ABB

previously had shipped under the terms of Price List 4605, or

otherwise was familiar with that list. Of the seventy-three

total bills of lading pre-dating March 2006 in the record, none

references Price List 4605. Indeed, Price List 4605 was issued

in November 2005 and became effective in December 2005, only

three months before the shipment at issue in this case, and

there is no evidence that ABB shipped any cargo pursuant to that

list in the interim three-month period.

22
 Of the nine ABB-CSX bills of lading included in the record,

several different rate authority codes were used, and the record

contains no evidence regarding the limits of liability

associated with those codes. 17 Steffey, Brueggeman’s predecessor

in the traffic manager position, testified that he entered these

rate authorities on the bills of lading after being instructed

to do so by CSX representatives with whom he had negotiated

rates for particular shipments, not because he was generally

familiar with CSX price lists. Counsel for CSX also conceded at

oral argument that CSX’s price lists are regularly changing,

further undermining the contention that ABB should have been

familiar with Price List 4605 at the time of the shipment. 18

We appreciate the common sense observation that a shipper

drafting an imprecise bill of lading should not stand to benefit

from its own lack of precision, as well as the district court’s

reflection that such a shipper need not be protected from

17
On one of the ABB-CSX bills of lading, Steffey included
the notation “FULL LIABILITY REQUIRED!!!,” at the direction of a
CSX marketing representative.
18
The dissent broadly asserts that ABB has admitted that in
its past dealings with CSX, it “always had to expressly request
full liability coverage in order to receive it.” Post at 32.
We do not discuss the evidence underlying this broad assertion,
because any alleged course of dealing prior to CSX’s
implementation of Price List 4605 does not bear on the question
whether the parties had memorialized in writing an agreement
that the March 2006 shipment would proceed under Price List
4605.

23
itself. Nevertheless, we are bound by the express language of

the Carmack Amendment, which puts the burden on the carrier to

demonstrate that the parties had a written agreement to limit

the carrier’s liability, irrespective whether the shipper

drafted the bill of lading. See 49 U.S.C. § 11706(a), (c). The

general contract principle that ambiguous contracts be construed

against the drafter, see, e.g., Wheeler v. Dynamic Eng’g, 62

F.3d 634, 638 (4th Cir. 1995), is inapplicable in the face of

statutory language that unambiguously imposes the risk of error

on one particular party, the carrier, to the exclusion of the

other party, the shipper. 19

Finally, we note that important practical considerations

support the conclusion we reach today. Shippers by necessity

entrust rail carriers with the safekeeping of expensive cargo

and, under the Carmack Amendment, are entitled to presume that

carriers will be held fully responsible for damage incurred

during transit unless otherwise agreed. Our ruling encourages

parties to employ precise bills of lading, which reflect fully

and specifically the parties’ choice of liability terms, and to

19
For the same reason, we disagree with the dissent’s
reliance on the state law principle that a unilateral mistake
does not justify rescission of a contract under the
circumstances of this case. Post at 35 (citing Kassebaum v.
Kassebaum, 42 S.W.3d 685, 693 (Mo. Ct. App. 2001)).

24
memorialize these terms in writing as Congress intended by

passage of the Carmack Amendment. See 49 U.S.C. § 11706.

IV.

In sum, we conclude that the district court erred in

awarding summary judgment in favor of CSX on its claimed

liability limitation of $25,000. We therefore vacate the

portion of the district court’s judgment fixing that liability

limitation and remand the case for further proceedings

consistent with this opinion.

VACATED IN PART AND REMANDED

25
 AGEE, Circuit Judge, concurring in part and dissenting in part:

I concur in the majority opinion except as to those parts

of Sections III and IV that conclude that the district court

improperly granted CSX’s 1 motion for partial summary judgment. In

my view, both the record and circuit precedent support the grant

of partial summary judgment in favor of CSX. Accordingly, I

respectfully dissent as to the above-noted parts of the majority

opinion.

I

As a preliminary matter, the BOL in the transaction at

issue was drafted by ABB, the shipper, on its own standardized

form. The BOL clearly stated,

Shipper hereby certifies that he is
familiar with all the terms and conditions
of the said bill of lading, including those
on the back thereof, set forth in the
classification or tariff which governs the
transportation of this shipment, and the
said terms and conditions are hereby agreed
to by the shipper and accepted for himself
and his assigns.

J.A. 121.

CSX’s effective rate schedule at the time of the shipment, Price

List 4605, clearly stated, “Carriers’ maximum liability for

1
For brevity and clarity, I adopt the same conventions as
in the majority opinion. For example, I refer to the defendant
as “CSX,” the plaintiff as “ABB,” and the Bill of Lading as
“BOL.”
lading loss or damage will not exceed $25,000 per shipment. Full

liability coverage is only available by calling your sales

representative for a specific quote.” J.A. 117.

Although ABB employees testified that they were not aware

of Price List 4605 prior to drafting the BOL, CSX employees

testified that Price List 4605 was published on the CSX company

website and was available upon request from any of its sales

representatives. ABB does not dispute that Price List 4605 was

available on CSX’s company website. ABB merely asserts that its

employees attempted to contact CSX to obtain a price quote, but

had no success in receiving rate information by telephone. 2

Despite its inability to receive price information from CSX, ABB

still chose to ship a $1.384 million transformer using CSX as

the carrier.

II

A

2
The majority opinion states that Brueggeman, ABB’s
employee, attempted to retrieve the price list from CSX’s
website without success. Majority Op. 14 & n.13. Yet contrary to
the majority opinion’s recitation, Brueggeman testified only
that “I looked all over the website and tried to find a lot of
different things and I do not ever remember seeing a price list
that they made available on the website for me to go and look
at.” J.A. 236. Brueggeman did not testify that the CSX website
did not contain Price List 4605. The record contains no evidence
contradicting CSX’s claim that Price List 4605 was published and
available on its website.

27
 The majority holds that “the parties did not reach a

written agreement to limit CSX’s liability and, accordingly, the

Carmack Amendment operated to impose full liability on CSX.”

Majority Op. 17. 3 On this point, we disagree. The record shows

that the parties made such a written agreement and that the

agreement complies with the requirements of the Carmack

Amendment and limits CSX’s liability.

The Carmack Amendment allows a commercial rail carrier to

limit its liability with the shipper’s written consent.

A rail carrier providing transportation or
service subject to the jurisdiction of the
Board under this part may establish rates
for transportation of property under which—

(A) the liability of the rail carrier
for such property is limited to a value
established by written declaration of
the shipper or by a written agreement
between the shipper and the carrier; or

(B) specified amounts are deducted,
pursuant to a written agreement between
the shipper and the carrier, from any
claim against the carrier with respect
to the transportation of such property.
49 U.S.C. § 11706(c)(3).

Courts determine whether such written consent is effective

under the Carmack Amendment by considering whether the carrier

3
The majority holds that the district court erred in
concluding that the Carmack Amendment does not apply when the
shipper has drafted the bill of lading. On this point, I agree
with the majority opinion; however, for the reasons stated
herein, I would hold that ABB does not prevail under the Carmack
Amendment.

28
(1) provided a tariff to the shipper upon the shipper’s request, 4

(2) “gave the shipper a reasonable opportunity to choose between

two or more levels of liability” (at least one of which was full

liability coverage), (3) “obtain[ed the] shipper’s agreement as

to his choice of carrier liability,” and (4) “issue[d] a bill of

lading prior to moving the shipment.” See OneBeacon Ins. Co. v.

Haas Indus., Inc., 634 F.3d 1092, 1099–1100 (9th Cir. 2011). 5

4
Prior to deregulation, courts held that a written
agreement limiting liability was valid only if the carrier
“maintain[ed] a tariff in compliance with the requirements of
the Interstate Commerce Commission.” Hughes Aircraft Co. v. N.
Am. Van Lines, Inc., 970 F.2d 609, 611 (9th Cir. 1992). However,
Congress eliminated the requirement that carriers file tariffs
with the government in 1994. OneBeacon, 634 F.3d at 1099. Courts
responded by holding that a carrier must provide its tariff to
the shipper upon the shipper’s request. Id. at 1100.

ABB argues that Price List 4605 is not a “tariff” because
the term “tariff” refers only to tariffs lawfully filed with the
ICC prior to deregulation, rendering that term essentially
meaningless in the deregulation era. Yet even after
deregulation, rate schedules and price lists, such as Price List
4605, are still commonly referred to as tariffs. See, e.g.,
Sassy Doll Creations, Inc. v. Watkins Motor Lines, Inc., 331
F.3d 834, 841 (11th Cir. 2003). As discussed more fully below,
post-deregulation, a “tariff” and “schedule of rates” are
equivalent terms in the contemporary trade.
5
The Eleventh Circuit has provided that a carrier and
shipper may effectively agree to a limitation on liability in
compliance with the Carmack Amendment if, for example, “a) the
carrier prepares a bill of lading which incorporates the
carrier's tariff by reference, b) that tariff contains an
applicable limitation of liability provision and c) the shipper
agrees to and signs the bill of lading,” or if “the shipper
. . . prepare[s] a similar bill of lading that the parties agree
to and sign.” Siren, Inc. v. Estes Express Lines, 249 F.3d 1268,
1270 (11th Cir. 2001) (emphasis omitted).

29
 Two of the above requirements are easily disposed of. As to

the first requirement, ABB does not dispute that CSX never, in

fact, received a request for its rates or tariff from ABB. While

ABB asserts that it made several telephone calls to CSX that

went unreturned, ABB presented no evidence that it ever made

actual contact with an authorized CSX agent to request CSX’s

rate information. Nor does ABB present any evidence to rebut

CSX’s testimony that its rate information was available on its

website. And courts have concluded that the fourth requirement,

that a carrier issue a bill of lading prior to shipment, is also

satisfied when the shipper prepares the bill of lading. See,

e.g., Siren, Inc. v. Estes Express Lines, 249 F.3d 1268, 1273

(11th Cir. 2001). Thus, at issue in this case is only whether

ABB had a reasonable opportunity to choose between two or more

levels of liability and whether ABB agreed in writing to limited

liability on the part of CSX.

The record reflects that CSX provided ABB with a reasonable

opportunity to choose between different levels of liability

coverage. The facts of this case seem indistinguishable from

those in Werner Enterprises v. Westwind Maritime International,

Inc. 6 In Werner, the Eleventh Circuit considered whether a

6
The majority opinion distinguishes Werner on the basis
that the contract between the shipper and the carrier suggested
that certain third-party carriers could limit their liability by
(Continued)
30
shipper was given a reasonable opportunity to elect full

liability coverage when the shipping document incorporated by

reference the carrier’s tariff, which contained a $200,000

limitation on liability. 554 F.3d 1319, 1328 (11th Cir. 2009).

Notably, the tariff at issue in Werner instructed a shipper to

specifically notify the carrier when it wanted full liability

coverage. Id. As in the case at bar, the shipper in Werner never

expressly requested full liability coverage from the carrier.

Id. at 1323. The shipper in Werner argued that it did not have a

meaningful opportunity to request full liability coverage

because the carrier’s default coverage was limited. Id. at 1327.

Faced with this argument, the Eleventh Circuit held that the

carrier properly limited its liability within the requirements

of the Carmack Amendment because it provided the shipper with

the right to request full liability coverage. Id.

ABB makes the same argument rejected by the Eleventh

Circuit in Werner—that CSX’s default policy of limited liability

deprived it of a reasonable opportunity to choose full liability

default and that full liability coverage was available only upon
a specific written request. While the BOL in this case did not
contain such a requirement on its face, it did incorporate this
requirement by reference to CSX’s “tariff which governs the
transportation of this shipment.” Moreover, even disregarding
ABB’s incorporation of CSX’s tariff by reference, ABB admits
that it was familiar with CSX’s default policy of limited
liability.

31
coverage. Yet like the carrier in Werner, CSX merely reserved

“the right to approve the request [for full liability coverage]

and charge a correspondingly higher rate.” Id. CSX’s effective

tariff, Price List 4605, incorporated by reference in the BOL,

provided shippers with the right to elect full liability

coverage.

Although ABB argues that it was not aware of Price List

4605, it is undisputed that CSX’s policy requiring its shippers

to affirmatively request full liability coverage was not new to

Price List 4605 and was not a change in policy from prior

dealings between CSX and ABB. In fact, ABB admits that in its

past dealings with CSX as well as other carriers, it always had

to expressly request full liability coverage in order to receive

it and that it was aware that rail carriers limited their

liability to amounts as low as $25,000 prior to the shipment at

issue. It is therefore easy to conclude that, as in Werner, CSX

provided ABB with a reasonable opportunity to elect full

liability coverage, an opportunity ABB chose not to avail itself

of for reasons known only to ABB. 7

This conclusion is further supported by the fact that ABB

7
The likely reason ABB did not pursue full liability
coverage was the incompetence or negligence, or both, of
Brueggeman, its agent. Nonetheless, the salient point for
Carmack Amendment purposes is that ABB had the option to pursue
full liability coverage and chose to ship its transformer
without doing so.

32
drafted the BOL in this case. ABB argues at length that various

problems with ABB’s own BOL deprived it of a reasonable

opportunity to choose full liability coverage. Among other

things, ABB argues that its form bill of lading would not allow

the employee filling it out to enter a value in the “declared

value” box of the form. ABB’s entire line of argument, however,

completely ignores the fact that ABB created the bill of lading

form and tendered it as a contract to CSX. While a carrier may

not require a shipper to use a form that deprives the shipper of

a reasonable opportunity to request full liability coverage, any

defects in a form created by a shipper are “no more than a

unilateral mistake” that cannot later be used against a carrier.

Sassy Doll, 331 F.3d at 842; see Werner, 554 F.3d at 1328

(stating that, while rejecting a similar claim, the court was

“particularly persuaded by the fact that the shipper drafted the

bill of lading.”); Norton v. Jim Phillips Horse Transp., Inc.,

901 F.2d 821, 830 (10th Cir. 1989) (“Carriers should not be held

to a standard that would impose liability on them due to a

unilateral mistake by an experienced shipper.”); Hughes v.

United Van Lines, Inc., 829 F.2d 1407, 1418–19 (7th Cir. 1987)

(“[O]nce the shipper was aware that the document signed was a

contract for transporting his goods, absent fraud or bad faith,

the shipper cannot reform the bill of lading without the consent

of the carrier on the grounds that they were unilaterally

33
mistaken about the terms of the contract.”). ABB cannot rely on

its own negligence in introducing its own defective document

into the commercial marketplace to avoid the resulting

consequences of its contractual covenants. Nothing in the

Carmack Amendment requires the carrier to hold the shipper

harmless for the shipper’s negligence, particularly where the

carrier has every reason to take the shipper at its word.

Moreover, ABB agreed in writing to CSX’s limitation on

liability. On its face, the BOL unambiguously incorporated CSX’s

effective tariff, which was Price List 4605, and therefore

functioned to limit CSX’s liability in accordance with the

Carmack Amendment. Specifically, ABB certified that it was

“familiar with all the terms and conditions . . . set forth in

the classification or tariff which governs the transportation of

this shipment” and that it agreed to be bound by those terms and

conditions. J.A. 121. The majority opinion treats this

unambiguous, binding contract language as inoperative, however,

because (1) the reference to the “tariff which governs the

transportation of this shipment” is generic boilerplate language

and (2) the BOL does not specifically mention Price List 4605.

ABB concedes that the BOL is a valid, binding contract

between the parties. The Court must therefore read that contract

consistently with the applicable contract law of the state in

which the contract was formed. See CTI/DC, Inc. v. Selective

34
Ins. Co. of Am., 392 F.3d 114, 118 (4th Cir. 2004). Because ABB

asserts that the contract was formed in Missouri and CSX does

not argue otherwise on appeal, we apply Missouri law.

Under Missouri law, the parol evidence rule bars courts

from considering whether a party to a contract may have

“intended anything other than what was written” in the contract

document. See Celtic Corp. v. Tinnea, 254 S.W.3d 137, 143 (Mo.

Ct. App. 2008). One party’s unilateral mistake cannot serve as

the basis of rescission under Missouri law unless the mistake

related to a material fact and the other party to the contract

knew or should have known of the mistake. See Kassebaum v.

Kassebaum, 42 S.W.3d 685, 693 (Mo. Ct. App. 2001).

ABB argues that the contract language is unenforceable as

written because the term “tariff” refers only to tariffs

lawfully filed with the ICC prior to deregulation, rendering

that term essentially meaningless in the ensuing 20 years of the

deregulation era. Yet even after deregulation, rate schedules

and price lists, such as Price List 4605, are still commonly, if

not uniformly, referred to as tariffs. See, e.g., Werner, 554

F.3d at 1328 (referring to the carrier’s post-deregulation

shipping document as a “tariff”); Sassy Doll, 331 F.3d at 841

(holding that, in the deregulation era, “a carrier is now

required to provide a shipper with the carrier's tariff if the

shipper requests it, instead of the shipper filing its tariff

35
with the now-defunct ICC”). Moreover, Price List 4605 clearly

falls within the plain meaning of the term “tariff,” which is

defined as “a listing or scale of rates or charges for a

business or a public utility.” 8 Webster’s Third New International

Dictionary 2341 (2002). Thus, the BOL plainly and unambiguously

stated on its face that ABB was familiar with the terms and

conditions of CSX’s effective tariff, which was Price List 4605,

and that ABB agreed to be bound by those terms. Consequently,

ABB’s argument that it intended the reference to “tariffs” in

its own document to carry no meaning is foreclosed by basic

principles of Missouri contract law. See Celtic Corp., 254

S.W.3d at 143.

ABB concedes in its opening brief, “There is nothing

ambiguous about the form language in the BOL.” Appellant’s Brief

47. Nonetheless, ABB argues that the court should not bind it to

its unambiguous contract provision because ABB did not have

actual knowledge of CSX’s effective tariff and because the

provision at issue was outdated boilerplate language 9—i.e.,

8
Price List 4605 also falls within the plain meaning of the
term “classification,” which is defined as “a publication
containing for the purpose of tariff assessment a list of
articles, the classes to which they are assigned, and the rules
and regulations governing the application of class rates.”
Webster’s at 417. ABB presents no argument that Price List 4605
is not a classification.
9
ABB emphasizes that the contract language at issue is
boilerplate language. Yet neither ABB nor the majority opinion
(Continued)
36
because ABB made a unilateral mistake in its drafting of the

BOL, albeit one it has perpetuated on a routine basis for two

decades. Yet ABB presents no evidence and makes no argument CSX

knew or should have known of ABB’s “mistake.” Rather, ABB admits

that it never had two-way communication with CSX and simply

faxed the completed BOL to CSX and relied on CSX as its carrier

for the shipment of the transformer. Upon CSX’s receiving the

completed BOL that unambiguously stated on its face that ABB was

aware of and accepted the terms of its effective tariff, CSX had

no reason to believe that ABB, an experienced shipper, did not

mean exactly what it stated in plain language on its own form.

Thus, in the absence of any evidence of bad faith on the part of

CSX, Missouri law prohibits ABB from avoiding the provision of

its own BOL that it now finds unfavorable. See Kassebaum, 42

S.W.3d at 693.

The majority rejects the plain language interpretation of

the BOL, arguing that under such an interpretation, “the

shipper’s ‘knowledge’ of the [effective price] list could be

proved solely by use of the generic and outdated word ‘tariff’

being employed as standard language in a bill of lading.”

cite to any authority suggesting that boilerplate contract terms
are somehow less binding than other contract terms, particularly
when the party seeking rescission of those terms is the party
that drafted them.

37
Majority Op. 18. Having already demonstrated that the term

“tariff” remains in common usage in the shipping industry, see

Sassy Doll, 331 F.3d at 841, I also note that ABB did not simply

make a general, passing reference to a “tariff” in the BOL.

Instead, ABB certified, in binding contract language, that it

was familiar with the terms of CSX’s tariff. That ABB now argues

it did not actually have the knowledge it then claimed it had is

simply no basis upon which to render meaningless the

unambiguous, binding terms of its contract with CSX. ABB’s

unilateral failure to draft its own contract with specificity

should not allow it to later abandon terms that it, in

hindsight, no longer finds favorable. As the Eleventh Circuit

stated in Sassy Doll, the Court’s sympathy should “not go out to

the drafter of a bill of lading who blames another party for the

results that flow from defects in that document.” 331 F.3d at

843; see also Werner, 554 F.3d at 1328 (holding that courts

should be “reluctant to protect a sophisticated shipper from

itself when it drafts a shipping document”).

Ultimately, it is undisputed that ABB is “an experienced

shipper[,] was not forced to employ [CSX],” and used its own BOL

contract. Mech. Tech. Inc. v. Ryder Truck Lines, Inc., 776 F.2d

1085, 1088 (2d Cir. 1985). It is therefore appropriate to bind

ABB to its own choices, even if ABB now argues it made those

choices by its own unilateral mistake. See Norton, 901 F.2d at

38
830 (“Carriers should not be held to a standard that would

impose liability on them due to a unilateral mistake by an

experienced shipper.”); see also Siren, 249 F.3d at 1272

(refusing to reform a shipping contract subject to the Carmack

Amendment when the shipper made a unilateral mistake). As

expressly contemplated in Siren, ABB “agree[d] in writing to a

limitation of liability” by “prepar[ing] a bill of lading which

incorporate[d] [CSX’s] tariff by reference,” and CSX’s tariff

“contain[ed] an applicable limitation of liability provision.”

Siren, 249 F.3d at 1270. 10 As the Eleventh Circuit noted in

Werner, “the [Carmack Amendment] requires nothing more than a

valid written contract between the parties establishing a

reasonable value for the purpose of limiting the liability of

the carrier.” 554 F.3d at 1328 (quoting Siren, 249 F.3d at

1271.)

III

For all the foregoing reasons, I conclude that the BOL,

incorporating Price List 4605 and its limitation on liability,

10
The majority opinion rejects these cases, each of which
apply the doctrine of unilateral mistake in the Carmack
Amendment context, by stating, without citation to any
authority, that the Carmack Amendment overrides standard
principles of contract interpretation by “unambiguously
impos[ing] the risk of error on one particular party, the
carrier, to the exclusion of the other party, the shipper.”
Majority Op. 24.

39
fully complies with the Carmack Amendment as a “written

agreement between the shipper and the carrier.” 49 U.S.C.

§ 11706(c)(3). I would therefore hold that the district court

properly applied the Carmack Amendment exception for written

agreements of limited liability and, thus, properly granted

partial summary judgment to CSX. Accordingly, I respectfully

dissent from the portion of Section III of the majority opinion

regarding the majority’s interpretation of the BOL and from

Section IV of the majority opinion. I would affirm the district

court’s order granting CSX’s motion for partial summary

judgment.

40