Failing to thoroughly vet a subcontractor — a driver who allegedly disappeared with a pricey load of lobster — will cost an Ohio logistics company nearly $300,000.
U.S. District Judge Indira Talwani ruled on Nov. 19 that Seneca Logistics Group LLC, based in Tiffin, Ohio, is on the hook for the never-recovered load after agreeing to haul it but then outsourced the job to Rapid Logistics Services Inc. A truck driver for Rapid, Ernesto Perez, allegedly stole the load of crustacean.
Authorities were subsequently unable to track down Rapid or Perez.
Richwell Group Inc., doing business as Maxfield Seafood, a Los Angeles-based seafood supplier, sued Seneca in August 2017, seeking to recover lost profits stemming from the purloined load after the Ohio logistics firm agreed to pick up the savory cargo at two cold storage facilities in Massachusetts in December 2016.
Without Maxfield’s knowledge, Seneca then “retained another party to transport the lobsters,” the lawsuit alleged in court documents filed in U.S. District Court in Boston.
The seafood supplier claimed Seneca made no effort to vet Perez’s or Rapid’s background or credentials to ensure the load would be delivered as promised.
Authorities were subsequently unable to track down Rapid or Perez.
In its complaint, Maxfield alleged that Seneca violated the Carmack Amendment, which governs a carrier’s liability to a shipper when interstate cargo is lost or damaged.
Seneca fired back that it was a broker, not a carrier, and wasn’t responsible for the stolen lobster.
However, Judge Talwani disagreed, stating that because Seneca took responsibility for the shipment, it was a carrier, even though it subcontracted with another trucking company to haul the load.
“The judge found Seneca was liable under the Carmack Amendment because Seneca was involved in every aspect of the shipment of the load — their conduct was like that of a carrier,” Elizabeth Zuckerman, a lawyer for Maxfield, told FreightWaves.
Zuckerman is an associate with Bulkley, Richardson and Gelinas LLP of Springfield, Massachusetts.
When Perez arrived at Preferred Freezer Services of Boston Harbor on Dec. 15, 2016, the cold storage facility called Seneca’s owner, Vincent Gradillo, to authorize the loading of the lobsters, the lawsuit states.
Five days later, Gradillo called Maxfield to advise the company that the load had been stolen and he was unable to get in touch with the driver. He then reported the theft to Everett, Massachusetts, police, according to the complaint.
“There wasn’t another carrier involved that Maxfield could have pursued for its losses because effectively what Seneca did was give all of our client’s information to a criminal individual or enterprise who showed up to pick up this load,” Zuckerman said.
Gradillo did not respond to FreightWaves’ request for comment.
