To amend title 49, United States Code, relating to improved consumer protection regulation of the household goods transportation industry, and for other purposes.

July 25, 2003

Mr. BOEHLERT (for himself, Ms. MILLENDER-MCDONALD, Mr. DUNCAN, Mr. PASCRELL, Ms. LOFGREN, Mr. COBLE, and Mr. MICHAUD) introduced the following bill; which was referred to the Committee on Transportation and Infrastructure

To amend title 49, United States Code, relating to improved consumer protection regulation of the household goods transportation industry, and for other purposes.

Be it enacted by the Senate and House of Representatives of the United States of America in Congress assembled,

SECTION 1. SHORT TITLE.

This Act may be cited as the `Consumer's Relocation Protection Act of 2003'.

SEC. 2. FINDINGS.

Congress finds the following:

(1) Federal regulation of interstate transportation of household goods is essential to the maintenance of the interstate household goods moving industry and so is vital to the requirements of our national economy and a strong national defense. The capability of the industry to meet the challenges presented by a mobile society is dependent upon a system of Federal regulation that is uniformly applied regardless of State origins and destinations of consumers' moves. Wholesale proliferation of Federal regulatory responsibilities among the States must be avoided to ensure a consistent regulatory environment that allows the industry to perform its essential service to the public.

(2) In 1996, Congress abolished the Interstate Commerce Commission and transferred its regulations governing the interstate transportation of consumers' household goods to the Department of Transportation. The Department of Transportation and the Federal Motor Carrier Safety Administration which are charged with regulation of the industry have, on numerous occasions, advised Congress that their primary mission is truck safety regulation and that they have neither the resources nor the manpower to effectively regulate the moving industry. Unfortunately, this condition has nurtured the growth of a cottage industry of rogue movers that preys upon the moving public through a variety of schemes employed to gain the confidence of consumers, and then their belongings, and finally, in exchange for those belongings, impose exorbitant charges for what purports to be a moving service. In reality, those services do not resemble the services of legitimate movers that conscientiously transport the overwhelming majority of the 1,300,000 interstate moves that are performed each year.

(3) While the rogue movers' participation in the interstate moving market is minutely small, the toll they have taken on the moving public and the legitimate moving industry is enormous. Numerous reports on the unlawful practices of these operators have been aired by our national television networks and countless similar press accounts have seriously tarnished the image of the entire legitimate moving industry which is made up largely of small business operators that comply with existing Federal regulations.

(4) Just recently the Federal Bureau of Investigation concluded a 2-year investigation into the practices of Florida-based unlawful operators that resulted in Federal criminal indictments of 42 rogue movers and 74 individuals that were involved in their operations. Aggressive Federal enforcement action of this nature must continue if we are to rid the moving industry of the scourge created by the rogue mover.

(5) Under existing Federal law, consumers have an adequate remedy to compensate them for the loss, damage, or delay of their property. However, in view of the operating practices of rogue movers, it is appropriate to enhance enforcement by granting to the States authority over certain unlawful practices that are contrary to Federal law.

(6) To meet this challenge it is appropriate that Congress act to close certain loopholes that have allowed the unscrupulous mover to thrive. This can be accomplished by conferring authority on the States to take action against movers that violate important Federal licensing, pricing, and arbitration requirements or engage in the insidious practice of holding consumers' goods hostage in exchange for a king's ransom. At the same time, it is necessary not to lose sight of the importance of avoiding measures that would threaten the financial stability of the legitimate moving industry and its ability to serve the public.

(7) Civil and criminal penalties are necessary to combat the unlawful practice of holding household goods hostage.

(8) Too many brokers of household goods transportation services, many of whom operate exclusively on the Internet, have run roughshod over consumers when arranging for the transportation of their household goods. Regulation of this segment of the moving industry is virtually nonexistent. Federal consumer protection regulations must be prescribed and the States should be authorized to pursue brokers that fail to arrange legitimate moving services for consumers.

(9) The Department of Transportation should establish a consumer complaint data information base and require the filing by movers of meaningful statistics on loss and damage claims.

(10) To promote the public's access to an inexpensive means of resolving claims for loss or damage, the present mandatory threshold for binding arbitration should be available for all claims of $10,000 or less instead of the present $5,000 or less amount. In addition, neutral arbitration should be

available to consumers to resolve certain transportation charge payment disputes in an inexpensive and expeditious manner.

(11) The Department of Transportation must impose meaningful registration requirements on all applicants for Federal authority to engage in the interstate transportation of household goods to ensure they are qualified to serve the public and to thwart the proliferation of unscrupulous operators.

(12) Consumers must receive written estimates of moving services and charges and inventories of goods to be transported to curb abusive rogue mover practices that misrepresent their services.

SEC. 3. FEDERAL-STATE RELATIONS RELATING TO THE TRANSPORTATION OF HOUSEHOLD GOODS.

(a) NONPREEMPTION OF INTRASTATE TRANSPORTATION OF HOUSEHOLD GOODS- Section 14501(c)(2)(B) of title 49, United States Code, is amended by inserting `intrastate' before `transportation'.

(b) ENFORCEMENT OF CONSUMER PROTECTION WITH RESPECT TO INTERSTATE HOUSEHOLD GOODS CARRIERS-

(1) STATE ENFORCEMENT REGARDING TRANSPORTATION OF HOUSEHOLD GOODS- Chapter 145 of such title is amended by adding at the end the following:

`Sec. 14506. State enforcement regarding transportation of household goods

`(a) AUTHORITY OF STATES-

`(1) INJUNCTIVE RELIEF- Notwithstanding any other provision of this title, if an attorney general of a State or other authorized officer of that State has reason to believe that the interests of the residents of that State have been or are being threatened or adversely affected because any person has engaged or is engaging in the performance or procuring of household goods transportation or service (including accessorial or terminal service) subject to jurisdiction under chapter 135 or 139 in violation of one or more of sections 13702(a)(2), 13901, 13902, 13903, 13904, 13906, and 14708, the State may bring a civil action for injunctive relief on behalf of its residents in an appropriate district court of the United States to enjoin such transportation or service and to compel the person to pay to the State any civil penalty assessed under chapter 149 with respect to such violation.

`(2) VIOLATION- A motor carrier providing transportation subject to jurisdiction under chapter 135, that knowingly and willfully refuses to relinquish possession of a shipment of household goods described in section 13102(10)(A) upon payment of not more than 100 percent of a binding estimate (or, in the case of a nonbinding estimate, not more than 110 percent of the estimated charges for such shipment) plus the charges for additional services that were performed at origin, en route, or at destination as authorized by the shipper and as required by section 13702, shall be liable for a civil penalty under chapter 149. A State may bring a civil action under this subsection in an appropriate United States district court to compel a motor carrier to relinquish possession of a shipment, to pay the civil penalty assessed under chapter 149 to the State, or to obtain injunctive relief.

`(b) AUTHORITY OF SECRETARY-

`(1) NOTICE- The State shall serve prior written notice of a civil action under subsection (a) upon the Secretary and provide the Secretary with a copy of its complaint; except that, if it is not feasible for the State to provide such prior notice, the State shall serve such notice immediately upon instituting such action.

`(2) AUTHORITY- Upon receiving notice of a civil action under this subsection, the Secretary shall have the right to--

`(A) intervene in such action;

`(B) be heard on all matters arising therein; and

`(C) to participate in or initiate an appeal of such action.

`(c) STATUTORY CONSTRUCTION- For purposes of bringing a civil action under subsection (a), nothing in this section shall be construed to prevent an attorney general of a State from exercising the powers conferred on the attorney general by the laws of such State to conduct investigations or to administer oaths or affirmations or to compel the attendance of witnesses or the production of documentary and other evidence.

`(d) ACTIONS BY THE SECRETARY- Whenever a civil action has been instituted by or on behalf of the Secretary for violation of any provision specified in subsection (a), no State may institute, during the pendency of such action, a civil action under subsection (a) against any defendant named in the complaint in such action for a violation alleged in such complaint.

`(e) VENUE; SERVICE OF PROCESS- A civil action under subsection (a) may be brought in the district in which the defendant is found, resides, or transacts business or wherever venue is proper under section 1391 of title 28. Process in such an action may be served in any district in which the defendant resides or in which the defendant may be found.

`(f) ACTIONS BY OTHER STATE OFFICIALS- In addition to actions brought by an attorney general of a State under subsection (a), such an action may be brought by officers of the State who are authorized by the State to bring actions in such State on behalf of its residents.'.

(2) HOUSEHOLD GOODS BROKERS- Section 13904 of such title is amended--

(A) by redesignating subsection (d) as subsection (e); and

(B) by inserting after subsection (c) the following:

`(d) HOUSEHOLD GOODS BROKERS-

`(1) REGULATIONS- Not later than 180 days after the effective date of the Consumer's Relocation Protection Act of 2003, the Secretary shall adopt regulations prescribing practices and procedures that ensure the fair and equitable treatment of individual shippers that utilize brokers of household goods described in section 13102(10)(A).

`(2) STANDARD FOR SELECTING CARRIERS- Each broker of household goods that is registered by the Secretary under this chapter shall use due diligence and reasonable care in selling or arranging the services of only those motor carriers of household goods that are in compliance with the requirements of this part and all applicable regulations maintained by the Secretary and the Board.

`(3) ENFORCEMENT BY THE SECRETARY AND THE STATES-

`(A) COMPLAINT- Whenever the Secretary or an attorney general of any State or other authorized officer of a State, in coordination with the Secretary, has reason to believe that a broker of household goods subject to this section has arranged for transportation by a motor carrier that has violated this part, or is consistently not fit, willing, and able to provide adequate household goods transportation services, the Secretary may issue to such broker a complaint stating the charges and containing notice of the time and place of a hearing which shall be held no later than 60 days after service of the complaint to such broker; except that, before issuing any complaint under this subsection, the State shall first request that the Secretary initiate an investigation and issue such complaint. If the Secretary declines to initiate an investigation, the State may initiate such an investigation and convene a hearing.

`(B) RIGHT TO DEFEND- The broker shall have the right to appear at any hearing convened pursuant to subsection (A) and rebut the charges contained in a complaint.

`(C) ORDER- If the broker does not appear at the hearing or if the Secretary or the State finds that the broker has violated this section, the Secretary may take appropriate action to compel compliance with this part and regulations issued thereunder, including issuance of an order to limit, condition, or prohibit such broker from any involvement in the procurement of service for the transportation of household goods.

`(D) RELIEF- Following an investigation and hearing under this subsection, the Secretary or the State may bring a civil action in a United States district court or a State court for injunctive relief and to compel a person to pay any civil penalty assessed under chapter 149 to the United States or the State, as the case may be.'.

(3) CONFORMING AMENDMENT- The analysis for chapter 145 of such title is amended by adding at the end the following:

`14506. State enforcement regarding transportation of household goods.'.

SEC. 4. WORKING GROUP FOR DEVELOPMENT OF PRACTICES AND PROCEDURES TO ENHANCE FEDERAL-STATE RELATIONS.

(a) IN GENERAL- Not later than 90 days after the date of enactment of this Act, the Secretary of Transportation shall establish a working group of State attorneys general, State consumer protection administrators, and Federal and local law enforcement officials for the purpose of developing practices and procedures to enhance the Federal-State partnership in enforcement efforts, exchange of information, and coordination of enforcement efforts, with respect to interstate transportation of household goods and of making legislative and regulatory recommendations to the Secretary concerning such enforcement efforts.

(b) CONSULTATION WITH INDUSTRIES- In carrying out subsection (a), the working group shall include representatives of industries involved in the transportation of household goods.

SEC. 5. CIVIL AND CRIMINAL PENALTY FOR HOLDING HOUSEHOLD GOODS HOSTAGE.

(a) IN GENERAL- Chapter 149 of title 49, United States Code, is amended by adding at the end the following:

`Sec. 14915. Holding household goods hostage

`(a) HOLDING HOUSEHOLD GOODS HOSTAGE DEFINED- For purposes of this section, the term `holding household goods hostage' means the knowing and willful refusal to relinquish possession of a shipment of household goods described in section 13102(A)(10) upon payment of not more than 100 percent of a binding estimate (or, in the case of a nonbinding estimate, not more than 110 percent of the estimated charges for such shipment) plus the charges for additional services that were performed at origin, en route, or at destination as authorized by the shipper and as required by section 13702.

`(b) CIVIL PENALTY- A motor carrier that is found holding a household goods shipment hostage is liable to the United States for a civil penalty of not less than $10,000 for each violation. If such carrier is subject to jurisdiction under chapter 135, the Secretary may suspend for a period of not less than 6 months the registration of such carrier under chapter 139.

`(c) CRIMINAL PENALTY- A motor carrier that has been convicted of knowingly and willfully holding household goods hostage by falsifying documents or demanding the payment of charges for services that were not performed or were not necessary in the safe and adequate movement of a shipment of household goods shall be fined under title 18, or imprisoned not more than 2 years, or both.'.

(b) CONFORMING AMENDMENT- The analysis for such chapter is amended by adding at the end the following:

`14915. Holding household goods hostage.'.

SEC. 6. CONSUMER HANDBOOK ON DOT WEB SITE.

Not later than 1 year after the date of enactment of this Act, the Secretary of Transportation shall take such action as may be necessary to ensure that publication OCE-100 of the Department of Transportation, entitled `Your Rights and Responsibilities When You Move' is prominently displayed, and available in language that is readily understandable by the general public, on the Web site of the Department of Transportation.

SEC. 7. DISPLAY OF INFORMATION ON HOUSEHOLD GOODS TRANSPORTATION RELATED WEB SITES.

Not later than 1 year after the date of enactment of this Act, the Secretary of Transportation shall modify the regulations contained in part 375 of title 49, Code of Federal Regulations, to require a motor carrier or broker that is subject to such regulations and that establishes and

maintains a Web site to prominently display on the Web site--

(1) the Department of Transportation number of the motor carrier or broker;

(2) the OCE-100 publication referred to in section 6; and

(3) in the case of a broker, a list of all motor carriers providing transportation of household goods used by the broker and a statement that the broker is not a motor carrier providing transportation of household goods.

SEC. 8. CONSUMER COMPLAINT DATABASE.

(a) ESTABLISHMENT OF SYSTEM- Not later than 1 year after the date of enactment of this Act, the Secretary of Transportation shall establish a complaint handling system to log individual shipper (as defined in section 13102 of title 49, United States Code) informal complaints related to motor carrier interstate transportation of household goods, an annual database of such complaints, and a procedure for public access to such data. All complaints recorded in the database must be identified by motor carrier bill of lading number and forwarded to the involved carrier. For each motor carrier included in the database, the percentage of complaints which were disputed must also be recorded.

(b) REGULATIONS- Not later than 1 year after the date of enactment of this Act, the Secretary of Transportation shall issue regulations requiring each motor carrier and freight forwarder providing transportation of household goods to submit an annual report on or before each March 31 covering the 12-month period ending on the prior March 31 (in this section referred to as the `reporting period') that summarizes--

(1) the number of shipments that originate and are delivered for individual shippers during the reporting period;

(2) the percent of those shipments identified in subparagraph (A) which resulted in the filing of a claim for loss or damage in excess of $500;

(3) the percent of claims identified in subparagraph (B) which were settled in the reporting period;

(4) the percent of claims identified in subparagraph (B) which were declined in the reporting period; and

(5) the percent of claims identified in subparagraph (B) which were pending on the last day of the reporting period.

(c) USE OF INFORMATION- In determining which motor carriers providing transportation of household goods should be subject to an investigation, the Secretary shall consider the failure to make a report in violation of section 14901 of title 49, United States Code, and information in the database established under subsection (a).

SEC. 9. ARBITRATION REQUIREMENTS.

(a) OFFERING SHIPPERS ARBITRATION- Section 14708(a) of title 49, United States Code, is amended by inserting before the period at the end the following: `and to determine whether carrier rates, in addition to those collected at delivery that are unpaid, must be paid by the shipper as required by the regulations of the Secretary governing the payment for transportation and service'.

(b) THRESHOLD FOR BINDING ARBITRATION- Section 14708(b)(6) of such title is amended by striking `$5,000' each place it appears and inserting `$10,000'.

(c) DEADLINE FOR DECISION- Section 14708(b)(8) of such title is amended--

(1) by striking `and'; and

(2) by inserting after `for damages' the following: `, and an order requiring the payment of additional carrier charges'.

(d) ATTORNEY'S FEES TO SHIPPERS- Section 14708(d)(3) of such title is amended--

(1) by redesignating subparagraphs (A) and (B) as subparagraphs (B) and (C); and

(2) by inserting before subparagraph (B) (as so redesignated) the following:

`(A) the shipper was not advised by the carrier during the claim settlement process that a dispute settlement program was available to resolve the dispute;'.

(e) ATTORNEY'S FEES TO CARRIERS- Section 14708(e) of such title is amended to read as follows:

`(e) ATTORNEY'S FEES TO CARRIERS- In any court action to resolve a dispute between a shipper of household goods and a carrier providing transportation or service subject to jurisdiction under subchapter I or III of chapter 135 concerning the transportation of household goods by such carrier, the carrier shall be awarded reasonable attorney's fees by the court only if--

`(1) the court proceeding is to enforce a decision rendered through arbitration awarding additional charges to the carrier under subsection (a) and is instituted after the period for performance under such decision has elapsed; or

`(2) the shipper brought the court action in bad faith--

`(A) after resolution of such dispute through arbitration under this section; or

`(B) after institution of an arbitration proceeding by the shipper to resolve such dispute under this section but before--

`(i) the period provided under subsection (b)(8) for resolution of such dispute (including, if applicable, an extension of such period under such subsection) ends; and

`(ii) a decision resolving such dispute is rendered.'.

SEC. 10. CIVIL PENALTIES RELATING TO HOUSEHOLD GOODS BROKERS.

Section 14901(d) of title 49, United States Code, is amended--

(1) by striking `If a carrier' and inserting the following:

`(1) IN GENERAL- If a carrier'; and

(2) by adding at the end the following:

`(2) ESTIMATE OF BROKER WITHOUT CARRIER AGREEMENT- If a broker for transportation of household goods subject to jurisdiction under subchapter I of chapter 135 makes an estimate of the cost of transporting any such goods before entering into an agreement with a carrier to provide such transportation of household goods subject to such jurisdiction, the broker is liable to the United States for a civil penalty of not less than $10,000 for each violation.

`(3) UNAUTHORIZED TRANSPORTATION- If a person provides transportation of household goods subject to jurisdiction under subchapter I of chapter 135 or provides broker services for such transportation without being registered under chapter 139 to provide such transportation or services as a motor carrier or broker, as the case may be, such person is liable to the United States for a civil penalty of not less than $25,000 for each violation.'.

SEC. 11. INDIVIDUAL SHIPPER DEFINED.

Section 13102 of title 49, United States Code, is amended by adding at the end the following:

`(25) INDIVIDUAL SHIPPER- The term `individual shipper' means any person who is the consignor or consignee of a household goods shipment, is identified as such in the bill of lading or other similar contract, owns the goods being or to be transported, and pays for their transportation.'.

SEC. 12. ADDITIONAL REGISTRATION REQUIREMENTS FOR MOTOR CARRIERS OF HOUSEHOLD GOODS.

Section 13902 of title 49, United States Code, is amended--

(1) by redesignating paragraph (4) as paragraph (5);

(2) by striking paragraphs (2) and (3) and inserting the following:

`(2) HOUSEHOLD GOODS; ADDITIONAL REQUIREMENTS- In addition to the requirements in subsection (a)(1), the Secretary shall register a person to provide transportation of household goods described in section 13102(10)(A) only after such person--

`(A) identifies the arbitration program in which it participates and provides a copy of its notice of such program as required by section 14708(b)(2);

`(B) identifies its tariff and provides a copy of its notice of the availability of such tariff for inspection as required by section 13702(c);

`(C) certifies that it has access to, has read, is familiar with, and will observe all applicable regulations of the Secretary and the Board governing consumer protection, estimating, consumer rights and responsibilities, and options for limitations of liability for loss and damage; and

`(D) discloses any relationship involving common stock, common ownership, common management, or common familial relationships between such persons and any other motor carrier, freight forwarder, or broker of household goods within the past 3 years.

`(3) CONSIDERATION OF EVIDENCE; FINDINGS- The Secretary shall consider and, to the extent applicable, make findings on any evidence demonstrating that the registrant is unable to comply with the requirements of one or more of subparagraphs (A), (B), and (C) of paragraph (1) and subparagraphs (A), (B), (C), and (D) of paragraph (2).

`(4) WITHHOLDING- If the Secretary determines that any registrant under this section does not or is not able to meet the requirements of paragraph (1) or (2), the Secretary shall withhold registration for a period of not less than 1 year.'; and

(3) by adding at the end of paragraph (5) (as so redesignated) the following: `In the case of a registration for the transportation of household goods described in section 13102(10)(A), the Secretary may also hear a complaint on the ground that the registrant fails or will fail to comply with the requirements of paragraph (2).'.

SEC. 13. ESTIMATING AND INVENTORY REQUIREMENTS.

Section 14104 of title 49, United States Code, is amended--

(1) in subsection (b) by striking paragraph (1) and inserting the following:

`(1) REQUIRED TO BE IN WRITING-

`(A) IN GENERAL- Except as otherwise provided [in this subsection], every motor carrier providing transportation of household goods described in section 13102(10)(A) subject to jurisdiction under subchapter I of chapter 135 shall conduct a physical survey of the household goods to be transported on behalf of a prospective individual shipper and shall provide the shipper with a written estimate of charges for the transportation and all related services.

`(B) WAIVER- A shipper may elect to waive a physical survey under this paragraph by written agreement signed by the shipper before [the] shipment is loaded. A copy of the waiver agreement must be retained as an addendum to the bill of lading and shall be subject to the same record inspection and preservation requirements of the Secretary as are applicable to bills of lading.

`(C) ESTIMATE-

`(i) IN GENERAL- Notwithstanding a waiver under subparagraph (B), a carrier's statement of charges for transportation must be submitted to the shipper in writing and must indicate whether it is binding or nonbinding.

`(ii) BINDING- A binding estimate under this paragraph must indicate that the carrier and shipper are bound by such charges. The carrier may impose a charge for providing a written binding estimate.

`(iii) NONBINDING- A nonbinding estimate under this paragraph must indicate that the actual charges will be based upon the actual weight of the shipment and the carrier's lawful tariff charges.'; and

(2) by adding at the end the following:

`(d) INVENTORIES-

`(1) IN GENERAL- Every motor carrier providing transportation of household goods described in section 13012(10)(A) subject to jurisdiction under subchapter I of chapter 135 shall prepare, at the time of loading a shipment of such household goods, a written inventory of all articles tendered by an individual shipper and accepted by the carrier for transportation.

`(2) CONTENTS- Every inventory under this subsection shall list or otherwise reasonably identify each item tendered for transportation, be signed by the shipper and the carrier or their respective agents at both the origin and destination, and shall be attached to and considered part of the bill of lading.

`(3) RECORD INSPECTION AND PRESERVATION REQUIREMENTS- An inventory under this subsection shall be subject to the same record inspection and preservation requirements of the Secretary as are applicable to bills of lading.'.

SEC. 14. EXTEND CIVIL PENALTIES TO BROKERS OF HOUSEHOLD GOODS.

Section 14901(d) of title 49, United States Code, is further amended by adding at the end the following:

`(4) BROKERS- If a broker of household goods described in section 13102(10)(A) providing service to individual shippers and subject to jurisdiction under subchapter I of chapter 135 fails or refuses to comply with any regulation issued by the Secretary relating to the protection of individual shippers, such broker shall be liable to the United States for a civil penalty of not less than $1,000 for each violation and for each additional day during which the violation continues.'.

SEC. 15. PROGRESS REPORT.

(a) IN GENERAL- Not later than 1 year after the date of enactment of this Act, the Secretary of Transportation shall transmit to Congress a report on progress in implementation of this Act, including the amendments made by this Act.

(b) OVERSIGHT HEARINGS- The Committee on Transportation and Infrastructure of the House of Representatives and the Committee on Commerce, Science, and Transportation of the Senate shall conduct periodic oversight hearings on the effects of this Act, including the amendments made by this Act, no less than annually for the first 5 years following the date of enactment of this Act to ensure that this Act, including the amendments made by this Act, is being implemented according to congressional intent.

END