Railroad Legal Issues and Resources (2015)

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130 G. Noncompliance with OSHA Regulations May Be Used 702 as Evidence of Employer’s Negligence In CSX Transp., Inc. v. Smith,610 the Supreme Court of Georgia held in accordance with FRA’s policy statement that “the OSHA stairway regulations in 29 CFR § 1910.24 apply to railroad office buildings.”611 XXXII. PREEMPTION OF STATE LAWS RELATING TO RAILROADS 704 A. Introduction 704 Because of the railroads’ importance to interstate commerce, Congress has enacted numerous statutes that regulate the railroad industry and that preempt state laws in part because of the railroads’ difficulty in complying with different laws on the same subject. Section B discusses recent preemption decisions by the federal courts. Sections C and D discuss recent preemption cases decided, respectively, by state courts and the Surface Transportation Board (STB). Section F cross-references this part of the digest to other preemption cases discussed in the digest. Cases 704 B. Recent Preemption Decisions by Federal Courts 704 1. Claim for Wrongful Termination Not Preempted by the Railway 704 Safety Act Powell v. Union Pac. R.R. Co.612 involved Union Pacific’s termination of Powell based on Powell’s alleged false injury report. Although a federal district court in California held that the Federal Railroad Safety Act preempted Powell’s claim under FELA, the Railway Labor Act did not preempt Powell’s wrongful termination claim because his cause of action was based on state law, not on a right conferred by a collective bargaining agreement.613 610 289 Ga. 903, 717 S.E.2d 209 (Ga. 2011). 611 Id., 289 Ga. at 906, 717 S.E. at 212. 612 864 F. Supp. 2d 949 (E.D. Cal. 2012). 613 Id. at 957–59.

131 2. ICCTA Held to Preempt State Antiblocking Statute and Negligence 705 Per Se Claim Based on the Statute In Elam v. Kansas City S. Ry. Co.,614 involving a Mississippi statute regulating the amount of time that a train may occupy a crossing, the Fifth Circuit held that because the state’s “antiblocking statute directly attempts to manage KCSR's switching operations,” the ICCTA preempted the state statute completely. 3. ICCTA Held Not to Preempt Tort Claims Under State Law 706 Not Involving Railroad Transportation of Passengers or Property or Related Services In Emerson v. Kansas City S. Ry. Co.,615 the plaintiffs alleged that actions of the Kansas City Southern Railway Co. caused flooding of the plaintiffs’ adjacent properties. The Tenth Circuit held that “[t]hese acts (or failures to act) are not instrumentalities ‘of any kind related to the movement of passengers or property’ or ‘services related to that movement’” and remanded the case.616 4. ICCTA Held to Preempt Vermont Environmental Land Use 708 Statute Having a Preconstruction Permit Requirement In Green Mountain R.R. Corp. v. Vermont,617 the Second Circuit held that the ICCTA preempted Vermont’s environmental land use statute, Act 250, Vt. Stat. Ann. Tit. 10, § 601, et seq., as applied to the railroad’s proposed transloading facilities. The court held that the ICCTA preempted Act 250 because its “pre-construction permit requirement…‘unduly interfere[s] with interstate commerce.’”618 5. ICCTA Preempted a City Ordinance Regulating Transportation 709 of Bulk Materials, Including Ethanol In Norfolk S. Ry Co. v. City of Alexandria,619 after the city amended its ordinance to prohibit the transportation of bulk materials on its streets, including ethanol, the Fourth Circuit 614 635 F.3d 796, 807 (5th Cir. 2011). 615 503 F.3d 1126 (10th Cir. 2007). 616 Id. at 1130 (citation omitted). 617 404 F.3d 638 (2d Cir. 2005). 618 Id. at 643 (citations omitted). 619 608 F.3d 150, 154 (4th Cir. 2010).

132 held that the ICCTA preempted the City’s bulk materials ordinance as it applied to Norfolk Southern. 6. No Preemption by the ICCTA of State Law on Minimum 709 Track Clearance In Tyrrell v. Norfolk Southern Railway Co.,620 the Sixth Circuit adopted a narrow interpretation of preemption under the ICCTA in rejecting Norfolk Southern’s argument that the ICCTA preempted a state law regulating minimum track clearances. 7. No Preemption of State Law on Storm Water Runoff 710 In MD Mall Associates, LLC v. CSX Transportation, Inc.,621 the Third Circuit held that the FRSA’s express preemption provision did not apply to MD Mall Associates, LLC’s claim in a negligence action against CSX that resulted from a spill of stormwater from CSX property. 8. No Preemption of a State Statute When a Railroad Company 711 Violates a Federal Standard of Care In Zimmerman v. Norfolk S. Corp.,622 the Third Circuit held that Zimmerman’s claims against the railroad for excessive speed and failure to maintain a safe crossing area were not preempted. 9. Preemption of State Law on Maximum Allowable Speed 713 In CSX Transp., Inc. v. Easterwood,623 in which the Supreme Court established a broad interpretation of preemption under the FRSA, the Court held that the FRSA preempted virtually all causes of action under state law against railroads regarding railroad safety. 10. Whether the ICCTA Preempts a State Statute Requiring a Railroad 714 to Pay for Sidewalks In Adrian & Blissfield R.R. v. Village of Blissfield,624 the Sixth Circuit held that the ICCTA did not preempt a Michigan statute that required a railroad to pay for a pedestrian 620 248 F.3d 517, 525 (6th Cir. 2001). 621 715 F.3d 479, 496, 497 (3d Cir. 2013), cert. denied, CSX Transp., Inc. v. MD Mall Assocs., LLC, 2014 U.S. LEXIS 530 (U.S., Jan. 13, 2014). 622 706 F.3d 170, 188 (3d Cir. Pa. 2013), cert. denied, 134 S. Ct. 154, 187 L. Ed. 2d 41 (2013). 623 507 U.S. 658, 664, 113 S. Ct. 1732, 1737, 123 L. Ed. 2d 387 (1993), superseded by statute as stated in Garza v. Norfolk Southern Ry. Co., 2012 U.S. Dist. LEXIS 123011, at *1 (N.D. Ohio July 23, 2012). 624 550 F.3d 533 (6th Cir. 2008).

133 crossing installed by a village across a railroad company’s tracks and sidewalks near the railroad’s property.625 C. Recent Preemption Decisions by State Courts 715 1. ICCTA Preempted Local Model Flood Plain Management 715 Ordinance as Applied to Railroads In Village of Big Lake v. BNSF Ry. Co., Inc.,626 the village complained that BNSF and the Missouri Highways and Transportation Commission violated the village’s Model Floodplain Management Ordinance. A Missouri appellate court held that “[t]he Ordinance and statute at issue…fall into the two broad categories of state and local actions that are categorically preempted by the ICCTA.”627 2. ICCTA Held to Preempt Oregon Statute that Prohibited Trains 716 from Blocking Railroad-Highway Grade Crossings for More than 10 Minutes In 2009 in Burlington N. & Santa Fe Ry. Co. v. Dep’t of Transportation,628 involving a state statute that generally prohibited trains from blocking railroad–highway grade crossings for more than 10 minutes, the Oregon Court of Appeals held that the Oregon law was by its express terms an “‘operating rule’ and a ‘regulation of rail transportation.’”629 3. ICCTA Held to Preempt Railroad’s Breach of Contract Action 716 for Use of Plaintiff’s Railroad Cars on the Defendants’ Railroad Lines At issue in San Luis Central Railroad Co. v. Springfield Terminal Railway Co.630 were state-law claims, including one for the defendants’ breach of an agreement for the use of the plaintiff’s railroad cars on the defendants’ railroad lines. A federal district court in Massachusetts held that the state law was preempted because the agreement “has regulatory force and receives continued regulatory oversight.”631 625 Id. at 535, 537 (citing MICH. COMP. LAWS S 462.309). 626 382 S.W.3d 125 (Mo. App. 2012). 627 Id. at 130 (citation omitted). 628 227 Or. App. 468, 206 P.3d 261 (2009), review denied, 347 Or. 446 (2009). 629 Id., 227 Or. App. at 474, 206 P.3d 264 (quoting Friberg v. Kansas City Southern Ry. Co., 267 F.3d 439, 443 (5th Cir. 2001) (citing 49 U.S.C. § 10501(b))). 630 369 F. Supp. 2d 172 (D. Mass. 2005). 631 Id. at 176.

134 4. No Preemption of a State Statute on Eminent Domain that 717 Does Not Regulate Railroad Transportation In Norfolk Southern. Ry. Co. v. Intermodal Props., L.L.C.,632 after Intermodal rejected several offers by Norfolk Southern to purchase Intermodal’s property, Norfolk Southern sought to acquire the property through eminent domain. The state court held that the ICCTA did not preempt New Jersey’s eminent domain statute because the statute did “not constitute the regulation of railroad transportation.”633 5. State Claims for Damages Not Preempted for Breach of Contract 718 or Breach of a Covenant Granting an Easement In PCS Phosphate Co. v. Norfolk Southern Corp.,634 the Fourth Circuit held that the ICCTA presumptively does not apply to voluntary agreements between private parties and does not expressly preempt claims for breach of contract or breach of a covenant granting an easement. D. Recent ICCTA Preemption Decisions by the STB 719 1. ICCTA Preemption of Local Permitting or 719 Preclearance Requirements In Grafton and Upton Railroad Company,635 the town of Grafton, Massachusetts, issued a cease and desist order against the construction of a new facility to transfer propane received by tank cars to trucks for delivery. The STB ruled that the local permitting or preclearance requirements were preempted because the facility would constitute transportation by rail carrier.636 632 424 N.J. Super. 106, 35 A.3d 726 (App. Div. 2012). 633 Id., 424 N.J. Super. at 128, 35 A.3d at 739 (citing N.J. STAT. ANN. § 48:12-35.1). 634 559 F.3d 212, 217–219 (4th Cir. 2009). 635 Grafton & Upton Railroad Co.–Pet. for Declaratory Order, FD 35752, slip op. at 2 (STB served Sept. 19, 2014), available at http://www.stb.dot.gov/decisions/readingroom.nsf/UNID/F9E35D4FF5F63EFF85257D58004A446A/$fil e/43910.pdf (last accessed Mar. 31, 2015). 636 Id. at 8.

135 2. ICCTA Preemption of Local Zoning Ordinance and Order 721 In Boston and Maine Corporation and Springfield Terminal Railroad Company,637 a zoning board directed all railroad traffic to a warehouse to cease and desist. The STB granted the petitioner’s request for a declaratory order allowing the continuation of the freight rail transportation to the warehouse because the Town’s actions were “plainly preempted by § 10501(b) [of the ICCTA].”638 3. Preemption of State Tort Claims Arising out of Railroad’s Action 722 Allegedly Causing Flooding of Adjacent Property In Thomas Tubbs, Trustee of the Thomas Tubbs Revocable Trust and Individually, and Dana Lynn Tubbs, Trustee of the Dana Lynn Tubbs Revocable Trust and Individually,639 the board concluded that the petitioners’ state law claims were preempted under the ICCTA; however, the petitioners’ claims that BNSF violated certain federal regulations issued under the Federal Railroad Safety Act regarding drainage under railroad tracks were not preempted under the ICCTA. E. Preemption Cases Summarized Elsewhere in the Digest 724 This subpart of the digest cross-references to preemption cases that are discussed in other parts of the digest. 637 Boston & Maine Corp.–Pet. for Declaratory Order, FD 35749 (STB served July 19, 2013), available at http://www.stb.dot.gov/decisions/ReadingRoom.nsf/UNID/43B8F53F6BF4C92185257BAD006B2D2C/$ file/43203.pdf (last accessed Mar. 31, 2015). 638 Id. at 4. 639 Thomas Tubbs–Pet. for Declaratory Order, FD 35792, slip op. at 7 (STB served Oct. 29, 2014), available at http://www.stb.dot.gov/decisions/readingroom.nsf/UNID/2C4E7A01A148E0A385257D8200477BE9/$fil e/43738.pdf (last accessed Mar. 31, 2015).