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170 Railroad Legal Issues and Resources SUMMARIES OF STATUTES, REGULATIONS, CASES, AND ARTICLES
171 I. ABANDONMENT OF RAIL LINES OR DISCONTINUANCE OF SERVICE A. Introduction Part I of the Report concerns issues arising out of a federal regulatory abandonment of a rail line, that is, an abandonment that is subject to the jurisdiction of the Surface Transportation Board (STB or the Board). Part I, thus, only concerns abandonment of rail lines and federal regulatory issues, whereas part XVII of the Report discusses abandonment of a railroadâs easement as a matter of state property law. Section B discusses the abandonment or discontinuance of a rail line or a portion thereof that is subject to 49 U.S.C. § 10903, et seq. and the regulations in 49 C.F.R. § 1152, et seq. The STB has exclusive and plenary authority to approve or deny applications submitted by rail carriers for abandonment or discontinuance of rail lines. The STB, created by the Interstate Commerce Commission Termination Act of 1995 (ICCTA), is the successor agency to the Interstate Commerce Commission (ICC).777 The STB is authorized to exempt rail carriers or classes of rail carriers from statutory provisions when certain criteria are satisfied. Section C summarizes federal statutes and discusses issues arising out of federal grants of rights of way that the United States made at one time to railroads, the abandonment of federally granted rights of way, and reversionary interests to the rights of way claimed by the federal government, as well as the rights of abutting landowners or municipalities to abandoned federal rights of way. 777 Surface Transportation Board, Overview, available at: http://www.stb.dot.gov/stb/about/overview.html (last accessed March 31, 2015).
172 Section D discusses the National Trails Systems Act (Trails Act) and the interim use of railroad rights of way for recreational trails pursuant to the Rails-to-Trails amendment to the Trails Act. Section E analyzes whether and when there is a taking of an abutting landownerâs property because of the use of an abandoned rail line as an interim recreational trail and claims against the United States under the Tucker Act for an alleged taking of property under the Rails- to-Trails Act of 1994.778 B. Law Applicable to an Abandonment of a Rail Line or a Discontinuance of Rail Service 1. Distinction between Abandonment and Discontinuance At the outset, it is important to distinguish between two concepts that are frequently referred to by the same term, namely, the term abandonment. In Mich. Depât of Natural Res. v. Carmody-Lahti Real Estate, Inc.779 the Supreme Court of Michigan distinguished an abandonment from âmere discontinuance of serviceâ as follows: an abandonment âinvolves relinquishing rail lines and underlying property interests. Discontinuance, on the other hand, âallows a railroad to cease operating a line for an indefinite period while preserving the rail corridor for possible reactivation of service in the future.ââ 780 As stated by the Sixth Circuit, â[a]bandonment consists of âa permanent or indefinite cessation of rail service, which terminates 778 See 16 U.S.C. § 1247(d) (2014). 779 472 Mich. 359, 699 N.W.2d 272 (Mich. 2005). 780 Id., 472 Mich. at 365, 699 N.W.2d at 276 (citations omitted).
173 a rail carrierâs public service obligation.â ⦠âAn abandoned railroad corridor is one that is no longer used for rail service and is removed from the national transportation system.ââ781 Statutes and Regulations 2. Procedures Applicable to an Abandonment or Discontinuance Federal law governs âabandonment of rail lines and discontinuance of rail service by common carriers.â782 When a railroad carrier subject to the jurisdiction of the STB decides to abandon or discontinue any part of a railroad line, the carrier must file an application with the STB.783 The statute requires an application to provide certain information, including a summary of the reasons for the abandonment or discontinuance and a detailed description of the line or lines that the railroad company is proposing to abandon or discontinue.784 Sections 1152.20 through 1152.29 of the Code of Federal Regulations (C.F.R.) furnish details on the procedure for filing an application and the required information.785 Applications for abandonment or discontinuance must contain, inter alia, a detailed map of the rail line to be abandoned or discontinued;786 a description of the service that the rail carrier provides;787 a statement of the 781 R. Ventures, Inc. v. Surface Transp. Bd., 299 F.3d 523, 531 (6th Cir. 2002) (citations omitted) (some internal quotation marks omitted). 782 See 49 U.S.C. §§ 10903-10905; 49 C.F.R. § 1152.1(a) (2014). 783 49 U.S.C. § 10903(a)(1) (2014). 784 49 U.S.C. §§ 10903(a)(2) and (b)(2) (2014). 785 49 C.F.R. §§ 1152.20-1152.29 (2014). 786 49 C.F.R. § 1152.22(a)(4) (2014). 787 49 C.F.R. § 1152.22(c) (2014).
174 impact of the abandonment or discontinuance on the community;788 an environmental impact statement;789 and a draft notice for the Federal Register regarding the rail line that is to be abandoned or discontinued.790 When a railroad files an application there are specific methods of notice that the carrier is required by statute to give.791 Section 10903 also requires that any abandonment or discontinuance of a rail line or lines contain provisions to protect the interests of employees.792 Section 1152.50 of the C.F.R allows a rail carrier to submit a notice of class exemption from the procedures in 49 U.S.C. § 10903, et seq.793 The section includes the procedures that a party seeking an exemption must follow, as well as the process that the STB must follow when determining whether to grant or deny an application for an exemption.794 See part I.B.3 below. The STB has three options when a rail carrier does not qualify for an exemption. First, âif the Board finds that the present or future public convenience and necessity require or permit the abandonment or discontinuance,â the STB may approve a rail carrierâs application to abandon or discontinue certain portions of a line.795 Second, the Board may approve an application with 788 49 C.F.R. § 1152.22(e) (2014). 789 49 C.F.R. § 1152.22(f) (2014). 790 49 C.F.R. § 1152.22(i) (2014). 791 49 U.S.C. § 10903(a)(3) (2014). 792 49 U.S.C. § 10903(b)(2) (2014). 793 49 C.F.R. § 1152.50 (2014); 49 U.S.C. § 10502 (2014) (establishing the authority of the STB to exempt rail carriers or certain provisions). 794 49 C.F.R. § 1152.50 (2014). 795 49 U.S.C. § 10903(d)-(e)(1)(a) (2014).
175 modifications.796 When the Board approves an application with modifications, the Board may set conditions that it finds are required by public convenience and necessity with which the rail carrier must comply.797 Furthermore, â[i]f the Board finds that the rail properties proposed to be abandoned are appropriate for public purposes and not required for continued rail operations, the properties may be sold, leased, exchanged, or otherwise disposed of only under conditions provided in the order of the Board.â798 Finally, the Board may deny outright an application if it fails to âfind[] that the present or future public convenience and necessity require or permit the abandonment or discontinuance.â799 When the Board determines that present or future public convenience and necessity require or permit the abandonment or discontinuance of a rail line, the Board must consider âwhether the abandonment or discontinuance will have a serious, adverse impact on rural and community development.â800 Within four months of a rail carrier submitting its application to discontinue or abandon a line, any party, including a governmental authority, may offer to provide financial assistance to avoid an abandonment or discontinuance.801 An offer of financial assistance may be in the form of a subsidy or an offer to purchase the rail line or lines.802 Under 49 U.S.C. § 10904 a rail carrier must provide to the STB and any parties that offer to provide financial assistance to avoid 796 49 U.S.C. § 10903(e)(1)(B) (2014). 797 Id. 798 49 U.S.C. § 10905 (2014). 799 49 U.S.C. § 10903(e)(2) (2014). 800 49 U.S.C. § 10903(d) (2014). 801 49 U.S.C. § 10904(c) (2014). 802 49 U.S.C. § 10904(c) (2014).
176 the abandonment or discontinuance of a line: (1) an estimate of the subsidy or purchase price needed to keep the rail line operational; (2) current reports on the condition of the rail line or lines to be abandoned or discontinued; (3) all the necessary data (e.g. traffic, revenue) to calculate an estimate of the subsidy or purchase price; and (4) any other information that the Board may determine is necessary for an accurate calculation of a subsidy or purchase price.803 When multiple parties offer financial assistance, a rail carrier may select the party it prefers for the purpose of the transaction.804 When a rail carrier and a financially responsible person, including a governmental authority, fail to agree on an amount or the terms of a subsidy or purchase, either part within 30 days after an offer is made may request the STB to establish the conditions and amount of compensation.805 When an offer of financial assistance is made, the discontinuance or abandonment of a line will be postponed until the rail carrier and the offeror agree on compensation or until the STB on request establishes the conditions and the amount of compensation that are required to keep the rail line from being abandoned or discontinued.806 The Board is required to establish the conditions and compensation within a 30-day period.807 As for proposed subsidies, the statute provides that âthe Board shall establish the compensation as the difference between the revenues attributable to that part of the railroad line and the avoidable cost of providing rail freight transportation on the line, plus a reasonable return 803 49 U.S.C. § 10904(b) (2014). 804 49 U.S.C. § 10904(f)(3) (2014). 805 49 U.S.C. § 10904(e) (2014). 806 49 U.S.C. § 10904(d)(2) (2014). 807 49 U.S.C. § 10904(f)(1)(A) (2014).
177 on the value of the line.â808 A subsidy arrangement entered into between a rail carrier and another party that is approved by the Board shall not âremain in effect for more than one year, unless otherwise mutually agreed by the parties.â809 Furthermore, for proposed sales, the Board shall determine the price and other terms of sale, except that in no case shall the Board set a price which is below the fair market value of the line (including, unless otherwise mutually agreed, all facilities on the line or portion necessary to provide effective transportation services)â¦.810 A party that purchases a line may not transfer or discontinue service for two years from the date of purchase, nor may it transfer the line to another party for five years from the date of purchase.811 3. STBâs Authority to Exempt a Person, Class of Persons, or a Transaction or Service As provided in 49 U.S.C. § 10502, the Board shall exempt a person, class of persons, or a transaction or service whenever the Board finds that the application in whole or in part of a provision of this partâ (1) is not necessary to carry out the transportation policy of section 10101 of this title; and (2) eitherâ (A) the transaction or service is of limited scope; or (B) the application in whole or in part of the provision is not needed to protect shippers from the abuse of market power. 808 49 U.S.C. § 10904(f)(1)(C) (2014). 809 49 U.S.C. § 10904(f)(4)(B) (2014). 810 49 U.S.C. § 10904(f)(1)(B) (2014). 811 49 U.S.C. § 10904(f)(4)(A) (2014).
178 Besides being able to commence a proceeding on its own initiative,812 the Board is empowered to specify the effective period of an exemption813 and may revoke an exemption when ânecessary to carry out the transportation policyâ described in 49 U.S.C. § 10101. Furthermore, an exemption order may not âoperate to relieve any rail carrier from an obligation to provide contractual terms for liability and claims which are consistent withâ 49 U.S.C. § 11706 that is applicable to the liability of rail carriers under receipts and bills of lading. There are regulations that apply to exemptions. For example, 49 C.F.R. § 1121.1, et seq. governs petitions filed under 49 U.S.C. § 10502 to exempt a transaction or service from 49 U.S.C. subtitle IV, or any provision of 49 U.S.C. subtitle IV, or to revoke an exemption previously granted. Section 1121.3 provides in part that (a) A party filing a petition for exemption shall provide its case-in-chief, along with its supporting evidence, workpapers, and related documents at the time it files its petition. (b) A petition must comply with environmental or historic reporting and notice requirements of 49 CFR part 1105, if applicable. (c) A party seeking revocation of an exemption or a notice of exemption shall provide all of its supporting information at the time it files its petition. Information later obtained through discovery can be submitted in a supplemental petition pursuant to 49 CFR 1121.2. It may be noted also that 49 CFR § 1152.50 applies to exempt abandonments and discontinuances of service and trackage rights. 812 49 U.S.C. § 10502(b) (2014). 813 49 U.S.C. § 10502(c) (2014).
179 Cases 4. Statutory and Common Law Principles for Establishing an Abandonment In Avista Corp. v. Wolfe814 the Ninth Circuit clarified 43 U.S.C. § 912, discussed also in part C.1 below) and the process for determining whether land is abandoned and when rights vest in the land. In 1958, Pacific Northwest abandoned its right of way to certain land and granted a quitclaim deed to Washington Water and Power to portions of Pacific Northwestâs right of way to the land, a deed that Sanders County accepted. In 2004, Sanders County gave a quitclaim deed for Government Lot 5 to the descendants of Arthur and Fanny Hampton. Avista Corp. commenced an action to quiet title and sought a declaratory judgment regarding the ownership of the right of way across Government Lot 5. The Ninth Circuit held that the Northern Pacific Railroad Company physically abandoned the right of way.815 The court explained that a determination of whether a railroad has abandoned its right of way is determined based on the plain language of 43 U.S.C. § 912 and common law principles of abandonment: the present intent to abandon and physical acts demonstrating the clear intent to abandon.816 However, the land could not be conveyed by a quitclaim deed, because Northern Pacific only âheld title in the form of a non-conveyable limited fee that reverted in the event that the company ceased to use or retain the land for which it was granted.â817 The Ninth Circuit held that according to the plain language of 43 U.S.C. § 912 814 549 F.3d 1239, 1248 (9th Cir. 2008). 815 Id. 816 Id. 817 Id. N 9 (internal quotations omitted).
180 declarations of abandonment may not be made retroactively.818 Therefore, after a right of way is abandoned and a public road is not built within a year of the right of wayâs abandonment the inchoate interests in the land become vested.819 The court affirmed the district courtâs determination that the railroad had abandoned its right of way.820 5. Recent Railroad Abandonment Decisions by the STB a. Request for Exemption under 49 U.S.C. § 10502 from Prior Approval Requirements of 49 U.S.C. § 10903 In CSX Transp. Inc., - Aban. Exemption â In White County, Ind.821 CSX Transportation, Inc. (CSXT) sought âan exemption under 49 U.S.C. § 10502 from the prior approval requirements of 49 U.S.C. § 10903 to abandon an approximately 9.67-mile rail line in White County, Ind. (the Line).â822 Monticello Farm Service, Inc. (MFS), the only shipper on the line, opposed the petition primarily because of CSXTâs low estimate of future carloads of nitrogen fertilizer that MFS would be receiving.823 CSXT argued that it was entitled to the exemption process under 49 U.S.C. § 10502 because its costs for the Line greatly exceeded the âtotal revenues attributable to the Lineâ¦.â824 818 Id. at 1250. 819 Id. at 1252. 820 Id. 821 CSX Transp. Inc., - Aban. Exemption â In White County, Ind., EB 43833, Slip Op. (STB served Sept. 19, 2014), available at: http://www.stb.dot.gov/decisions/readingroom.nsf/UNID/15AA5535B36F775E85257D58004CE5AC/$fil e/43833.pdf (last accessed March 31, 2015). 822 Id. at 1. 823 See id. at 2. 824 Id. at 2-3 (footnote omitted).
181 The Board explained that [u]nder 49 U.S.C. § 10502 ⦠we must exempt a transaction or service from regulation when we find that: (1) continued regulation is not necessary to carry out the rail transportation policy of 49 U.S.C. § 10101; and (2) either (a) the transaction or service is of limited scope, or (b) regulation is not necessary to protect shippers from the abuse of market power.825 Furthermore, abandonment proposals that are subject to the exemption process are those in which âshippers do not contest the abandonment or, if they do contest it, the revenue from the traffic on the line is clearly marginal compared to the cost of operating the line.â826 The problem for CSXTâs petition was that there was insufficient evidence to enable the Board to compare the revenue attributable to the Line to the cost of operating it.827 As amended, CSXTâs petition was âunreliable because of miscalculations, unexplained discrepancies, or a lack of supporting evidenceâ that resulted in too many âunresolved questions.â828 Therefore, the Board could not evaluate the alleged economic burden to continue operating the Line even though there was an active shipper.829 Although the Board denied the petition, CXST could file an appropriate abandonment application or petition for exemption that cured the âdefectsâ in the current petition.830 825 Id. at 3-4. 826 Id. at 4. 827 Id. 828 Id. at 5, 6. 829 Id. at 1. 830 Id. at 6.
182 b. Request to Authorize a Third Party or Adverse Abandonment of a Line In Paulsboro Refining Company LLC â Adverse Abandonment â in Gloucester County, N.J.831 Paulsboro Refining Company LLC (PRC) requested the Board to authorize the third-party abandonment, referred to as an adverse abandonment, of approximately 5.8 miles of PRCâs rail line (the Line) that SMS Rail Service, Inc. (SMS), a Class III railroad, operated for PRC. PRC owned the Line that was within PRCâs 970-acre refinery in Paulsboro, N.J.832 PRC, which was the Lineâs primary shipper, planned to replace SMS with Savage Services Group (Savage), a noncarrier contract switching operator, pursuant to a private contract.833 Consolidated Rail Corporation, on behalf of Norfolk Southern Railway Company and CSX Transportation, Inc., identified by the Board as the âInterchange Carriers,â took a neutral position on the abandonment other than to request that the Board stay the exercise of any abandonment authority until PRC completed appropriate agreements with the Interchange Carriers.834 The Board reiterated the legal standard that it had to apply: Under 49 U.S.C. § 10903(d), the standard that applies to any application for authority to abandon a line of railroad is whether the present or future public convenience and necessity (PC&N) require or permit the proposed abandonment. In applying this standard in a third-party or adverse abandonment context, the Board considers whether there is a present or future public need for rail service over the line and whether that need is outweighed by other interests.835 831 AB 1095 (Sub-No.1), Slip Op. at 1 (STB served Dec. 2, 2014), available at: http://www.stb.dot.gov/decisions/readingroom.nsf/UNID/7A83E1ACF028CC8385257DA200546855/$fil e/43977.pdf (last accessed March 31, 2015). 832 Id. at 1. 833 Id. at 5. 834 Id. at 7. 835 Id. at 4 (footnote omitted).
183 In view of PRCâs dispute with SMS, the Board stated that it âdoes not allow its jurisdiction to be used as a bar to state law remedies in the absence of an overriding federal interestâ836 and that its decision to remove the agencyâs jurisdiction would enable âthe applicant to pursue other legal remedies against the incumbent carrierâ¦.â837 Because there was no present or future need for common carrier service, the Board approved the application. The Board rejected SMSâs claims that the abandonment should be denied because federal railroad safety regulations would no longer apply. The Board noted that other federal safety regulations would continue to apply.838 Based on the Final Environmental Assessment by the Boardâs Office of Environmental Analysis, the Board stated that no environmental conditions were needed;839 however, the Board imposed certain âemployee protective conditions.â840 The Board also agreed to require SMS to cooperate with PRC and the Interchange Carriers during the transition and ordered that the abandonment authority could be exercised only after all ânecessary agreements were in place.â841 836 Id. 837 Id. at 5 (footnote omitted). 838 Id. 839 Id. at 6. 840 Id. (citing Oregon Short Line RailroadâAbandonment Portion Goshen Branch Between Firth & Ammon, in Bingham & Bonneville Counties, Idaho, 360 I.C.C. 91 (1979)). 841 Id. at 7.
184 c. Denial of Petition to Reopen Declaratory Order Proceeding in the Absence of Changed Conditions or New Evidence In BNSF Railway Company â Petition for Declaratory Order842 the Board followed-up on its 2010 authorization of BNSF to abandon 1.54 miles of a rail line in Oklahoma City, Oklahoma pursuant to 49 U.S.C. § 10903. In 2005, when the Oklahoma Department of Transportation was planning to relocate Interstate 40 in downtown Oklahoma City, BNSF invoked the Boardâs expedited class exemption procedures under 49 C.F.R. 1152 Subpart Fâwhich are available only for lines that have not had any local traffic for at least two yearsâto abandon 2.95 miles of its Chickasha Subdivision between milepost 539.96 and milepost 542.91 (â¦the âChickasha Lineâ).843 Although no shipper objected, a non-shipper Edwin Kessler objected, who claimed that there had been local traffic on the Chickasha Line within the two-year period.844 In June 2008, the Board ruled that BNSFâs use of the expedited procedure was inappropriate because of the presence of âan undetermined level of local trafficâ on the eastern end of the line. Although the Board rejected BNSFâs notice of exemption, the Board stated that BNSF could seek to abandon the Chickasha Line by filing either a petition for an individual exemption or a formal abandonment application.845 Instead, in July 2008 BNSF argued that it was entitled to a declaratory order finding that what BNSF characterized as a relocation of two segments of the Chickasha Line, the eastern and middle segments, did not require the Boardâs 842 BNSF Railway Company â Petition for Declaratory Order, FD 35164, Slip Op. at 1 (STB served May 7, 2010), available at: http://www.stb.dot.gov/decisions/readingroom.nsf/UNID/BFDBAEB594ECED188525771B00702699/$fi le/40399.pdf (last accessed March 31, 2015). 843 Id. at 2. 844 Id. 845 Id.
185 prior approval.846 Although it was asserted that a shipper Boardman, Inc. (Boardman) would be deprived of rail service, Boardman informed the Board that it would be unaffected by BNSFâs plans for the middle segment and that in any case BNSF had assured Boardman that it would continue to have access to rail service as needed.847 Nevertheless, after the initiation in October 2008 of the declaratory order proceeding, Edwin Kesslerâs brother, John Kessler (J. Kessler), argued that BNSFâs plan for the middle segment would adversely affect Boardman and thus required prior Board authorization.848 Nevertheless, the Board decided that BNSFâs plan for the eastern segment was a relocation that did not require the Boardâs prior authorization and that the previous and current proceedings demonstrated âample supportâ for approval of the abandonment of the middle segment.849 In June 2009 J. Kessler filed a petition to reopen BNSFâs petition for a declaratory order. J. Kessler argued that that the Board should not have accepted BNSFâs explanation of how service would be provided to Boardman.850 The petition to reopen was not supported by a showing of changed circumstances or by new evidence. The Board determined that Boardman did not currently need rail service, that BNSF would provide rail service when Boardman required it, and that J. Kesslerâs arguments regarding the absence of future rail service for Boardman were nothing more than speculation. 846 Id. 847 Id. at 3 848 Id. 849 Id. at 4. 850 Id.
186 In response to another partyâs arguments that the abandonment exemption should be revoked and that BNSF should be required to prepare an EIS, the Board stated that [w]hile abandonments do require environmental review, they generally involve an Environmental Assessment (EA) rather than a full EIS. The Boardâs Section of Environmental Analysis (SEA) prepared an EA in connection with BNSFâs proposed abandonment of the Chickasha Line and the Board made the exemption subject to all 5 of the environmental conditions recommended by SEA.851 The Board denied J. Kesslerâs petition to reopen the declaratory order proceedings.852 6. Class Exemption and Relocation In Kessler v. Surface Transportation Board,853 the STBâs decisions having been discussed in the previous part B.5.c, Kessler petitioned the District of Columbia Circuit to review the Boardâs decision to exempt BNSF, but the court dismissed Kesslerâs petition.854 The court held that the STBâs decision was not arbitrary or capricious or an abuse of discretion. The Board reasonably relied on BNSFâs representations concerning the use of the middle segment of the rail line and the Oklahoma DOTâs representations on the need for the highway and its costs.855 The court explained that it is within the STBâs discretion to exempt a rail carrier from abandonment procedures under 49 U.S.C. § 10904 âwhen the right-of-way to be abandoned is needed for a public purpose and there is no overriding public need for continued rail service.â856 Furthermore, the court agreed with the STBâs interpretation of 49 C.F.R. § 1152.50(d)(3) that 851 Id. at 8 (footnote omitted). 852 Id. at 9. 853 635 F.3d 1, 3 (D.C. Cir. 2011). 854 Id. at 8. 855 Id. at 5. 856 Id.
187 when an application for an exemption is void ab initio, only the rail carrier is prohibited from the use of the exemption.857 The Board is not prevented from ârelying upon any part of the record before it that is not false or misleading or ⦠later, upon a proper showing, granting the rail carrier an individual exemption.â858 The court ultimately denied Kesslerâs request to review the Boardâs decision to exempt BNSF from the abandonment procedures in 49 U.S.C. § 10904 and dismissed Kesslerâs due process claim.859 7. Judicial Approval of the Abandonment of a Line of a Railroad Company Reorganizing in Bankruptcy Normally, the STB must authorize the abandonment of a railroad line, but in the case of a railroad company reorganizing in bankruptcy, a court may authorize an abandonment.860 An abandonment may be authorized when a court determines either that it is âin the best interest of the estateâ or that the abandonment is âessential for the formulation of a planâ and is âconsistent with the public interest.â861 However, if the Boardâs approval is required under a federal statute, the trustee is required to file an application with the Board.862 8. STBâs Authority in Adverse Abandonment Proceeding and in Involuntary Bankruptcy Proceeding A bankruptcy case decided by the First Circuit is one of the more recent appellate decisions discussing 49 U.S.C. § 10903 that involved the STB rather than its predecessor the 857 Id. 858 Id. 859 Id. 860 11 U.S.C. § 1170 (2014). 861 11 U.S.C. § 1170(a) (2014). 862 11 U.S.C. § 1170(b) (2014).
188 ICC. The decision in Howard v. Surface Transportation Board863 is relevant because the First Circuit confirmed the power, jurisdiction, and involvement of the Board in deciding whether rail lines may be abandoned, including in bankruptcy proceedings. In 2001, Bangor & Aroostook Railroad Company (BAR) and Canadian National (CN) entered into several agreements regarding the rights to and use of the Madawaska rail line.864 Several months later, certain creditors brought an involuntary Chapter 11 bankruptcy proceeding against BAR.865 Part of the bankruptcy plan was an agreement for Montreal, Maine & Atlantic Railway LTD (MM&A) to acquire the Madawaska line and other BAR rail assets from the trustee.866 The MM&A agreement included a provision that would require MM&A to pay BAR $5 million if BAR successfully removed Canadian National from the Madawaska line prior to January 1, 2005.867 In bankruptcy court the appointed trustee in bankruptcy attempted to oust Canadian National from the Madawaska rail line.868 However, the STB denied the trusteeâs petition filed with the Board to revoke Canadian Nationalâs rights in the line.869 The trustee then asserted that the 863 389 F.3d 259, 267 (1st Cir. 2004). 864 Id. at 261-262 (All the agreements between the two railroad companies were approved by the Board in the same year). 865 Id. at 262. 866 Id. 867 Id. 868 Id. at 262-263. 869 Id.
189 Board did not have the final authority and that the bankruptcy court could make a final determination on whether a rail line may be abandoned adversely.870 In Howard, the First Circuit explained that â[g]enerally, the [Boardâs] authority over abandonment of rail lines is exclusive and plenaryâ with the one exception of bankruptcy proceedings.871 In bankruptcy proceedings the Board plays an important advisory role, but the bankruptcy court has the power to make final determinations.872 Thus, the court held that âCongress made it clear in enacting 11 U.S.C. § 1170 that it wanted the bankruptcy court, not the STB, to make the final determination of whether a debtorâs rail lines could be abandoned and the STB to play an advisory role, subject to time constraints.â873 Importantly, the STB was not ousted of its exclusive jurisdiction over all matters pertaining to bankrupt railroads. See 11 U.S.C. § 1166 ⦠If, for example, the debtor as part of its reorganization plan wanted to âconstruct an extension to any of its railroad lines,â âconstruct an additional railroad line,â or âprovide transportation over ... an extended or additional railroad line,â it would first have to apply to the STB for a certificate authorizing such activity. See 49 U.S.C. § 10901.874 The First Circuit differentiated between âabandonmentâ proceedings and âadverse abandonmentâ proceedings that are initiated by a third party.875 The court held that a bankruptcy court has the power to make final determinations in abandonment or discontinuance proceedings but that the Board retains its jurisdiction over âadverseâ abandonment or discontinuance 870 Id. at 263-264. 871 Id. at 268. 872 Id. 873 Id. (emphasis in original). 874 Id. 875 Id. at 270.
190 proceedings.876 Therefore, the First Circuit affirmed the district courtâs dismissal of the trusteeâs request for an âorder from the bankruptcy court authorizing the discontinuance of CNâs trackage rights and the abandonment of CNâs easement.â877 The First Circuit further affirmed the STBâs order denying the trusteeâs application for an adverse abandonment and discontinuance.878 9. Preemption of Actions in State Court for Damages Caused by Abandonment of a Rail Line In Chicago & N.W. Transp. Co. v. Kalo Brick & Tile Co.879 the Supreme Court preempted actions in state court for damages when the STBâs predecessor, the ICC, had approved the abandonment or discontinuance of a rail line. The Chicago & N.W. Transportation Co. filed a petition with the ICC to abandon a 5.6 mile rail line between Kalo and Fort Dodge in Iowa.880 While the petition for abandonment was pending before the ICC, the respondent filed claims for damages in state court. Although the Court of Appeals of Iowa ruled that federal law did not preempt state abandonment law,881 the United States Supreme Court held that the ICC had plenary and exclusive power over the abandonment of interstate rail lines and âpurely local lines operated by regulated carriers.â882 The Court held âthat the Interstate Commerce Act precludes a shipper 876 Id. at 268, 270-271. 877 Id. at 263, 270. 878 Id. at 271. 879 450 U.S. 311, 101 S. Ct. 1124, 67 L. Ed.2d 258 (1981). 880 Id., 450 U.S. at 314-315, 101 S. Ct. at 1128-1129, 67 L. Ed.2d 258. 881 Id., 450 U.S. at 316-317, 101 S. Ct. at 1129-1130, 67 L. Ed.2d 258. 882 Id., 450 U.S. at 320, 101 S. Ct. at 1131-1133, 67 L. Ed.2d 258.
191 from pressing a state-court action for damages against a regulated carrier when the [ICC], in approving the carrierâs application for abandonment, reaches the merits of the matters the shipper seeks to raise in state court.â883 The Court reserved âfor another day the question whether such a cause of action lies when no application is made to the Commission.â884 The Supreme Court reversed the Iowa Court of Appeals and remanded the case for further proceedings not inconsistent with the Courtâs opinion.885 C. Federal Grants of Rights of Way to Railroads, Abandonment, and Reversionary Rights Articles 1. Statutes Applicable to Grants of Rights of Way to Railroads by the United States An article published by the Congressional Research Service provides an analysis of important federal statutes pursuant to which the federal government previously granted rights of way to railroads and on the issue of who owns the property after a railroad abandons the easement or right of way.886 The article explains that the 1875 General Railroad Right of Way Act (the 1875 Act)887 permitted railroads to obtain a 200-foot federal right of way for rail lines across public lands.888 883 Id., 450 U.S. at 322-323, 101 S. Ct. at 1132-1133, 67 L. Ed.2d 258. 884 Id. 885 Id., 450 U.S. at 332, 101 S. Ct. at 1137, 67 L. Ed.2d 258. 886 Pamela Baldwin and Aaron M. Flynn, Congressional Research Service, CRS Report for Congress, âFederal Railroad Rights of Way,â at 16 (Updated May 3, 2006), available at: http://congressionalresearch.com/RL32140/document.php (last accessed March 31, 2015), hereinafter referred to as âCRS Report for Congress.â 887 43 U.S.C. § 934 (repealed).
192 In 1976 Congress repealed the 1875 Act when it enacted the Federal Land Policy and Management Act (FLPMA).889 The FLPMA also repealed some laws known as the pre-1871 Acts under which railroads had been granted rights of way. In the Act of 1922,890 Congress provided that âupon forfeiture or abandonment, the lands granted to any railroad company for use as a right of way for its railroad ⦠would pass to a municipality if the right of way passed through one, or to adjacent landowners, except that a highway could be established within the right of way within one year after the date of a forfeiture or abandonment.â891 The CRS article states that âCongress has legislated numerous times over the years regarding federal railroad rights of way, as though Congress believed it had continuing authority over their ultimate disposition.â892 Thus, [t]he 1922 Act and the report language explaining it reveal an important point that arguably has not received adequate attention. Clearly, Congress believed that it had retained the authority to provide for the disposition of railroad rights of way, whether because Congress continued to hold some traditional property interest, such as a reversionary interest â¦, or because its retained authority over the termination of the rights granted was an element of the property interests granted.893 With the Rails to Trails Act, discussed in parts D and E of the Report, Congress sought 888 CRS Report for Congress, supra note 886, at 1. 889 See Memorandum, Solicitor General of the United States Department of the Interior re Opinion M- 370265 (November 4, 2011), available at: http://www.blm.gov/style/medialib/blm/wo/Communications_Directorate/public_affairs/news_release_att achments.Par.20306.File.tmp/MOpinionQAs.pdf (last accessed March 31, 2015). 890 See 43 U.S.C. § 912 (2014) (disposition of abandoned or forfeited railroad grants). 891 CRS Report for Congress, supra note 886, at 10. 892 Id. at 2. 893 Id. at 12.
193 to deal with the problem of state property laws providing for the expiration of easements upon abandonment. As codified at 16 U.S.C. § 1247(d), Congress provided railroads wishing to discontinue service on a particular route an opportunity to negotiate with state, municipal, or private entities who were prepared to assume responsibility for conversion and management of the rail corridor as a trail. ⦠By avoiding final abandonment status, the railroad right of way did not pass under applicable state law or 43 U.S.C. § 912.894 The authors argue that it is âincreasingly difficult to reconcile the sequence of congressional enactments and judicial holdings into a coherent body of law.â895 They point out that there is some judicial authority holding that the United States retained a reversionary interest in the aforesaid grants of rights of way. However, in Beres v. United States,896 summarized in part XVII.D.3, involving the 1875 Act, the Court of Federal Claims held that because only an easement was granted for a right of way âwhen the right of way was no longer used for railroad purposes, the easement was lifted and no property interest reverted to the United States.â897 Finally, after the 2006 CRS article, in 2014 in Marvin M. Brandt Revocable Trust v. United States,898 summarized in part I.C.3, the Supreme Court âheld that abandoned railway rights-of- way that had been granted to railroad companies under the General Railroad Right-of-Way Act of 1875 left underlying landowners with property free of the rights-of-way[] and [that] the United States government has no interest in the abandoned land.â899 894 Id. at 13 (footnotes omitted). 895 Id. at 4. 896 97 Fed. Cl. 757 (Fed. Cl. 2011). 897 CRS Report for Congress, supra note 886, at 16. 898 134 S. Ct. 1257, 188 L. Ed.2d 272 (2014). 899 Erica Stutman, Snell & Wilmer, âBrandt Revocable Trust v. U.S. â the United Statesâ theory of land ownership derailed,â March 30, 2014, available at: http://www.swlaw.com/blog/real-estate-
194 2. Whether the Federal Government retains any Ownership in Railroad Rights of Way Granted after 1871 A law review article, written prior to the Brandt case, discussed in part I.C.3, discusses the split in the federal circuit courts of appeals on whether the federal government retains any ownership in railroad rights of way that were granted after 1871, the year in which Congress discontinued granting land to railroad companies in favor of granting rights of way to the companies.900 In 2005, in Hash v. United States901 the Federal Circuit held that the United States retained no property rights in land abandoned by a railroad after 1871 and therefore any reuse of the property would constitute a taking under the Fifth Amendment that would entitle a property owner to compensation.902 However, the Seventh, Ninth, and Tenth Circuits held that the United States did retain and may assert its property rights to land granted to railroads when a railroad abandons a federally granted right of way.903 Because the STB on several occasions authorized the conversion of rights of way abandoned by railroads for use as recreational trails, a new group litigation/2014/03/30/brandt-revocable-trust-v-u-s-the-united-states-theory-of-land-ownership-derailed/ (last accessed March 31, 2015). 900 Darwin R. Roberts, âThe Legal History of Federally Granted Railroad Rights-of-Way and the Myth of Congressâs â1871 Shift,ââ 82 U. Colo. L. Rev. 85, 85-86 (2011), hereinafter referred to as âRoberts.â 901 403 F.3d 1308 (Fed. Cir. 2005). 902 Roberts, supra note 900, at 90-91. 903 Id. at 90. See Avista Corp. v. Wolfe, 549 F.3d 1239, 1246-1251 (9th Cir. 2009); Samuel C. Johnson 1988 Trust v. Bayfield County., 520 F.3d 822 (7th Cir. 2008); Mauler v. Bayfield County., 309 F.3d 997 (7th Cir. 2002); Phillips Co. v. Denver and Rio Grande W. R.R. Co., 97 F.3d 1375 (10th Cir. 1996); Marshall v. Chi. & Nw. Transp. Co., 31 F.3d 1028 (10th Cir. 1994); Vieux v. E. Bay Regional Park Dist., 906 F.2d 1330 (9th Cir. 1990); King County. v. Burlington N. R.R. Co., 885 F. Supp. 1419 (W.D. Wash. 1994).
195 of cases has arisen.904 The article agrees with the United Statesâ position that the government may take rights of way abandoned by railroads and reuse them for use as recreational trails without violating the Takings Clause of the Fifth Amendment.905 Case 3. Property Ownerâs Right after a Railroadâs Abandonment of an Easement Marvin M. Brandt Revocable Trust v. United States,906 decided by the Supreme Court in March 2014, involved interests granted under the General Railroad Right-of-Way Act of 1875, 43 U.S.C. §§ 934-939, a statute that was repealed in 1976 by the Federal Land Policy and Management Act, § 706(a), 90 Stat. 2793. In 1976, the United States patented to Melvin and Lulu Brandt in fee simple an 83-acre parcel of land in Fox Park that contained several easements that would terminate if they were not used by the United States or its assigns for a period of five years.907 A land patent, the highest form of title, is a conveyance of land owned by the United States to a private individual.908 Specifically, the 1976 land patent stated that âthe land was âsubject to those rights for railroad purposes as have been granted pursuant to the General Railroad Right-of-Way Act of 1875 to the Laramie, Hahnâs Peak & Pacific Railway Company, 904 Roberts, supra note 900, at 89-90. See, e.g., Beres v. United States, 64 Fed. Cl. 403 (2005); Ellamae Phillips Co. v. United States, 77 Fed. Cl. 387 (2007), vacated and remanded by Ellamae Phillips Co. v. United States, 564 F.3d 1367 (Fed. Cir. 2009). 905 Roberts, supra note 900, at 93. 906 134 S. Ct. 1257, 188 L. Ed.2d 272 (2014). 907 Id., 134 S. Ct. at 1262, 188 L.Ed.2d at 277. 908 See Ballentineâs Law Dictionary (3d Ed.)
196 its successors or assigns.ââ909 However, the patent did not mention what would occur if the right of way were abandoned.910 In 1996, LHP&Pâs successor, Wyoming and Colorado Railroad, notified the STB that it would abandon the right of way and completed the abandonment in 2004.911 In 2004, the railroad in possession of the right of way properly abandoned it pursuant to the STBâs procedures and approval.912 In 2006, the United States sought to quiet title to the abandoned right of way including a right of way over the Brandtsâ property. However, the Brandt family trust counterclaimed and argued that the right of way âwas a mere easement that was extinguished upon abandonment by the railroad, so that, under common law property rules, [the trust] enjoyed full title to the land without the burden of the easement.â913 As it had held in Great Northern R. Co. v. United States,914 the Supreme Court held that the General Railroad Right-of-Way Act of 1875 granted only an easement to the railroad company, not an interest in fee.915 As such, in 2004 when the railroad company properly abandoned the right of way the âBrandtâs land became unburdened of the easement, conferring on him the same full rights over the right of way as he enjoyed over the rest of the Fox Park 909 Marvin M. Brandt Revocable Trust, 134 S. Ct. at 1262, 188 L.Ed.2d at 278. 910 Id. 911 Id., 134 S. Ct. at 1263, 188 L. Ed.2d at 278-279. 912 Id., 134 S. Ct. at 1263, 188 L.Ed.2d at 278. 913 Id., 134 S. Ct. at 1263, 188 L. Ed.2d at 279. 914 315 U.S. 262, 271, 62 S. Ct. 529, 86 L. Ed. 836 (1942). 915 Marvin M. Brandt Revocable Trust, 134 S. Ct. at 1264, 188 L.Ed.2d at 280.
197 parcel.â916 Therefore, the Supreme Court reversed the Tenth Circuit and remanded for further proceedings consistent with the Courtâs opinion.917 Although the government argued that the National Trails System Improvement Act of 1988 preserved the governmentâs interest in abandoned railroad rights of way, the United States had already waived any claim to the right of way by reason of the 1976 land patent to the Brandts twelve years earlier. Thus, âif there is no âright, title, interest, [or] estate of the United Statesâ in the right of way, ⦠then the statutes simply do not apply.â918 Statutes D. The National Trails System Act 1. Authorization for the Interim Use of Railroad Rights of Way for Recreational Trails In 1968, Congress enacted the National Trails System Act (Trails Act).919 In 1976 Congress supplemented the Trails Act by enacting the Railroad Revitalization and Regulatory Reform Act (4R Act) to encourage the use of unused railroad rights of way as trails.920 Thereafter, the National Trails Systems Improvements Act of 1988921 amended the Trails Act and provided that: Commencing October 4, 1988, any and all right, title, interest, and estate of the United States in all rights-of-way of the type described in [43 U.S.C. § 912], shall 916 Id., 134 S. Ct. at 1266, 188 L.Ed.2d at 282. 917 Id., 134 S. Ct. at 1269, 188 L.Ed.2d at 285. 918 Id., 134 S. Ct. at 1268, 188 L. Ed.2d at 284 (quoting 43 U.S.C. § 912). 919 Pub. L. 90â543, 82 Stat. 919 (October 2, 1968), codified at 16 U.S.C. § 1241, et seq. 920 Pub. L. No. 94-210, 90 Stat. 33. See 45 U.S.C. § 801, et seq. (2014). 921 Pub. L. No. 100-470, 102 Stat. 2281, 2281 (1988), codified at 16 U.S.C. § 1248(c).
198 remain in the United States upon the abandonment or forfeiture of such rights-of- way, or portions thereof, except to the extent that any such right-of-way, or portion thereof, is embraced within a public highway no later than one year after a determination of abandonment or forfeiture, as provided under such section.922 The Rails-to-Trails Act of 1994 (Rails-to-Trails) preserved abandoned railroad rights of way by preventing them from reverting to the original grantor of the easement or the grantorâs successor-in-interest.923 Thus, § 1247(d) presently provides, first, that: The Secretary of Transportation, the Chairman of the Surface Transportation Board, and the Secretary of the Interior, in administering the Railroad Revitalization and Regulatory Reform Act of 1976 [45 U.S.C. 801, et seq.], shall encourage State and local agencies and private interests to establish appropriate trails using the provisions of such programs. Second, § 1247(d) further provides that: [I]n the case of interim use of any established railroad rights-of-way pursuant to donation, transfer, lease, sale, or otherwise in a manner consistent with this chapter, if such interim use is subject to restoration or reconstruction for railroad purposes, such interim use shall not be treated, for purposes of any law or rule of law, as an abandonment of the use of such rights-of-way for railroad purposes.924 Third, when a State, political subdivision, or qualified private organization is prepared to assume full responsibility for management of such rights-of-way ⦠the Board shall impose such terms and conditions as a requirement of any transfer or conveyance for interim use in a manner consistent with this chapter, and shall not permit abandonment or discontinuance inconsistent or disruptive of such use.925 922 16 U.S.C. § 1248(c) (2014). 923 16 U.S.C. § 1247(d) (2014). 924 Emphasis supplied. 925 Id.
199 Thus, federal law allows the Secretary of Transportation and the STB on an interim basis to preserve an abandoned railroad right of way as a recreational trail until the right of way is used again for railroad purposes.926 Regulations 2. Requirements for Interim Trail Use of Railroad Right of Way Federal regulations lists the requirements with which a state, political subdivision, or private organization must comply when requesting to use abandoned railroad right of way for interim trail use.927 The requirements include: (1) A map depicting, and an accurate description of, the right-of-way, or portion thereof (including mileposts), proposed to be acquired or used; (2) A statement indicating the trail sponsorâs willingness to assume full responsibility for: (i) Managing the right-of-way; (ii) Any legal liability arising out of the transfer or use of the right-of-way (unless the user is immune from liability, in which case it need only indemnify the railroad against any potential liability); and (iii) The payment of any and all taxes that may be levied or assessed against the right-of-way; and (3) An acknowledgment that interim trail use is subject to the sponsorâs continuing to meet its responsibilities described in paragraph (a)(2) of this section, and subject to possible future reconstruction and reactivation of the right-of-way for rail service.928 926 See 16 U.S.C. § 1247(d) (2014). 927 49 C.F.R. § 1152.29(a) (2014). 928 49 C.F.R. §§ 1152.29(a)(1)-(3) (2014).
200 E. Whether and When Interim Use as a Recreational Trail of an Abandoned Railroad Right of Way is a Taking under the Fifth Amendment 1. Takings when an Easement was Granted or Obtained only for Railroad Purposes This section of the Report discusses the rights that a private property owner has when a railroad abandons a right of way that crosses the ownerâs land. Whether a private property owner is entitled to just compensation depends on the type of property interest held by the railroad. When an easement was granted or obtained only for railroad purposes, a private property owner may claim a right to just compensation when the government re-purposes a right of way after it has been abandoned by a railroad.929 However, if a railroad acquired a fee simple interest in the property used as a rail line and later abandons it the prior owner or successor-in- interest has âno interest in that strip of land, and can claim no damages for its later use as a recreational trail.â930 Statute 2. The Tucker Act and Claims against the United States The Tucker Act931 provides that the Court of Federal Claims has jurisdiction to render judgment upon any claim against the United States founded either upon the Constitution, or any Act of Congress or any regulation of an executive department, or upon any express or implied contract with the United States, or for liquidated or un-liquidated damages in cases not sounding in tort.932 929 Presault v. United States, 100 F.3d 1525, 1552 (Fed. Cir. 1996). 930 Id. at 1536. 931 28 U.S.C. § 1491 (2014). 932 28 U.S.C. § 1491(a)(1) (2014).
201 Therefore, any claims in excess of $10,000 by property owners against the United States for takings subject to the Fifth Amendment to the Constitution caused by or relating to abutting railroad property must be brought in the Court of Federal Claims.933 The United States District Courts retain concurrent jurisdiction over Tucker Act claims for $10,000 or less.934 Cases 3. Takings Claims against the United States arising under the Trails Act Although the decision has been distinguished by a few lower federal courts, Preseault v. Interstate Commerce Commission935 is an important Supreme Court case on claims against the United States for a taking under the Trails Act. In Preseault, the petitioners had a reversionary interest in land over which a railroad had a right of way. The petitioners attempted to obtain a certificate of abandonment from the ICC, but the state of Vermont intervened, claiming that the state had a right of way in fee simple or in the alternative had an easement that had not been abandoned.936 The state of Vermont petitioned the ICC to allow the railroad to discontinue service and transfer the right of way to the city of Burlington for interim use as a public trail.937 The petitioners argued that the Trails Act was unconstitutional under the Fifth Amendment because the statute constituted a taking without just compensation and because the statute was not a valid exercise of congressional power under the Commerce Clause.938 933 Id. 934 28 U.S.C. § 1346(a)(2) (2014). 935 494 U.S. 1, 110 S. Ct. 914, 108 L. Ed.2d 1 (1990). 936 Id., 494 U.S. at 9, 110 S. Ct. at 920, 108 L. Ed.2d 1. 937 Id. 938 Id., 494 U.S. at 9, 110 S. Ct. at 914, 108 L. Ed.2d 1
202 The Courtâs decision observed that the Tucker Act establishes jurisdiction in the Court of Federal Claims for claims based on a federal taking.939 The Court explained that the Tucker Act âis an implied promise to pay just compensation which individual laws need not reiterateâ and applies as well to rail-to-trail conversions.940 First, the Court held that it was premature for the petitioners to seek âreview of the ICCâs order in the ⦠Second Circuitâ¦.â941 Second, it was âclearâ that the Interstate Commerce Act and the ICCâs authority âpre-empt[] the operation and effect of certain state laws that conflict with or interfere with federal authority over the same activity.â942 Third, in affirming the Second Circuitâs judgment the Court held that the Tucker Act requires that a claim based on a federal taking of property be brought in the Court of Federal Claims and that the Trails Act was a valid exercise of congressional power under the Commerce Clause.943 4. Requirement of Just Compensation when New Uses are Imposed In Toews v. United States944 the Federal Circuit held that â[t]he Government has the legal power ... to impose such new uses upon the fee interests held by the adjacent landowners. But ... 939 Id., 494 U.S. at 11-12, 110 S. Ct. at 921-922, 108 L. Ed.2d 1. 940 Id., 494 U.S. at 13, 110 S. Ct. at 922, 108 L. Ed.2d 1 (citing 16 U.S.C. § 1247(d) (internal quotation marks omitted). 941 Id., 494 U.S. at 17, 110 S. Ct. at 927, 108 L. Ed.2d 1. 942 Id., 494 U.S. at 21, 110 S. Ct. at 927, 108 L. Ed.2d 1 (OâConnor, J., concurring) (internal quotation marks omitted). 943 Id., 494 U.S. at 11-13, 110 S. Ct. at 921-22, 108 L. Ed.2d 1. 944 376 F.3d 1371 (Fed. Cir. 2004).
203 the private property interests taken are not free; the Government must pay the just compensation mandated by the Constitution.â945 In Toews, the plaintiffs alleged that the city of Clovis took their property in violation of their Fifth Amendment rights by converting an abandoned railroad right of way for use as a recreational trail under the Trails Act. The original deed from the plaintiffsâ predecessors-in- interest granted a right of way to the railroad for the use of designated land for railroad purposes but provided that the land would automatically revert to the original property owner or his or her successor-in-interest if the right of way were abandoned.946 After the railroad petitioned the ICC for permission to cease operating a segment of its right of way, the ICC issued a Notice of Interim Trail Use or Abandonment (NITU) because the city had requested that the abandoned rail line be used for an interim trail.947 The NITU permitted the use of the right of way as a recreational trail on the condition that the railroad would convey its interest in the right of way to the city.948 The Federal Circuit held that the use of a railroad right of way as a recreational trail was an entirely different use; thus, the NITU constituted a taking under the Fifth Amendment.949 The basis of the holding was that the city had âused an existing railroad easement for purposes and in a manner not allowed by the terms of the grant of the easement.â950 The court further held that when the federal government âacts through 945 Id. at 1379. 946 Id. at 1373. 947 Id. at 1374. 948 Id. 949 Id. at 1376. 950 Id.
204 a state agentâ to bring about a taking it is not âabsolve[d] ... from the responsibility, and the consequences, of its actionsâ and therefore must compensate the landowner.951 Because the United States had authorized the city to use the right of way for non-railroad purposes, the court affirmed the trial courtâs judgment holding the United States liable for a taking.952 5. Whether there is a Taking of a Reversionary Right or Interest In Thompson v. United States953 a complaint in a class action alleged that the STBâs issuance of a NITU constituted a taking because the disposition of a right of way was delayed for up to 180 days that allowed the railroad to be converted for use as a public trail with the land eventually being sold.954 Moreover, the plaintiffs proffered authenticated, recorded deeds and local tax records that were âsufficient to establish a fee simple absolute at the time the railroad acquired a property interestâ¦.â955 Thus, the plaintiffs had a reversionary interest in fee simple absolute when the government converted the right of way to a public recreational trail.956 Because the plaintiffs had a reversionary interest in the easements to their properties, and because Michigan laws did not authorize the use of railroad easements for public recreational 951 Id. at 1381-1382. 952 Id. at 1372. 953 101 Fed. Cl. 416 (Fed. Cl. 2011). 954 Id. at 421-423. 955 Id. at 431. 956 Id. at 434.
205 trails, the governmentâs actions constituted a taking.957 The court granted the plaintiffsâ motion for summary judgment with the issue of just compensation left for determination at trial.958 6. Effect of an STB Notice of Interim Trail Use as a Taking When a NITU is issued by the STB pursuant to 16 U.S.C. § 1247(d), some courts have held that the notice constitutes a taking under the Fifth Amendment. In Ellamae Phillips Co. v. United States959 the Ellamae Phillips Co. (Phillips) owned a tract of land traversed by a railroad corridor. The corridor, at the time held by the Roaring Fork Railroad Holding Authority, was converted to a bike path pursuant to the Trails Act.960 The Phillips company argued that the governmentâs conversion of the railway corridor into a recreational path constituted a taking.961 However, the Federal Circuit explained that âunder any view of takings law, only some rail-to- trail conversions will amount to takings.... Others are held as easements that do not even as a matter of state law revert upon interim use as nature trails.â962 Whether there is a taking ârest[s] on the scope, not abandonment, of the easement, as the taking of a reversionary interest in a right-of-way is compensable regardless [of] whether the right-of-way has been abandoned.â963 The court held that the trial court had the authority to determine the scope of the easement and whether a railway had been abandoned in deciding whether the government was liable for a 957 Id. 958 Id. 959 564 F.3d 1367, 1368 (Fed. Cir. 2009). 960 Id. at 1369. 961 Id. at 1370. 962 Id. at 1372. 963 Id.
206 taking.964 The Federal Circuit therefore vacated and remanded the case for a determination of the scope of the easement and whether the easement had been abandoned. Article 7. Elements of Liability in Takings Claims based on the Trails Act An article in the Ecology Law Quarterly analyzes the main points of Preseault, discussed supra, part I.E.3, and analyzes the proceedings that followed the Supreme Courtâs decision.965 The author begins by explaining the purpose of the National Trails System Act and its regulatory framework. The article observes that âCongress passed the first iteration of the Trails Act in 1968, seeking to preserve unwanted railway lines for possible future use.â966 Several years later the Congress added provisions âencouraging third parties to acquire the lines for recreational use.â967 The article also summarizes the regulatory framework and the STBâs involvement in the process of railbanking, i.e., the preservation of right of way for potential future railroad use.968 The author provides guidance on whether a landowner has a viable takings claim under the Trails Act and discusses the organization and analysis of arguments to be presented on the issue of liability in a takings claim.969 Part of the analysis is to determine whether the right of 964 Id. at 1373. 965 Cecilia Fex, âThe Elements of Liability in a Trails Act Takings: A Guide to the Analysis,â 38 Ecology L.Q. 673 (2011). 966 Id. at 677. 967 Id. 968 Id. at 682. 969 Id.
207 way has been abandoned de jure or de facto 970 and whether the landowner owned the property at the time of the taking.971 The author points out that even if it is not clear whether an abandonment has occurred the statute of limitations for a takings claim under the Trails Act is six years.972 The article further explains that there are three issues to consider when litigating takings claims under the Trails Act.973 The first issue is whether a railroad company acquired land in fee simple or acquired an easement.974 Second, if there is an easement, the scope of the easement must be established to determine whether the federal government is liable.975 When determining the scope of the easement, the question is whether the easement âwas limited in its terms to railroad purposes, or whether the terms were less specific, allowing for uses beyond railroad use, and if so what the parameters of the other uses are.â976 The third and final issue, although not always necessary, is whether there was an abandonment of the right of way.977 The Federal Circuit has explained that the abandonment issue should be raised only if the scope of the easement cannot be determined and that the issue of abandonment should be raised last;978 thus, 970 Id. 971 Id. at 683-685. 972 Id. 973 Id. at 685-700. 974 Id. at 686-689. 975 Id. at 689-698. 976 Id. at 685. 977 Id. at 698-700. 978 Id.
208 âthe Federal Circuit places the abandonment issue behind the scope of easement issue, indicating [that] courts need only reach the issue if the question of scope is not dispositive.â979 Therefore, if the second issue relating to easements has been resolved, the last issue need not be addressed.980 979 Id. at 699. 980 Id. at 698-700.
209 II. AMERICANS WITH DISABILITIES ACT A. Introduction The Americans with Disabilities Act (ADA) was enacted to âprovide a clear and comprehensive national mandate for elimination of discrimination against individuals with disabilitiesâ981 in employment, transportation, public accommodations, communications, and government activities.982 Section B discusses provisions of the ADA that apply to transportation by rail, including the Actâs prohibition of discrimination against employees and patrons. Section C discusses what is required for a prima facie case of employment discrimination because of a disability. Section D addresses the meaning of a disability under the Act before and after the 2008 amendments to the Act. Section E reviews issues concerning the feasibility of alterations to make facilities accessible to rail patrons. Sections F and G summarize articles on the ADA and the ADA Amendments Act of 2008 and transportation and civil rights. Statute B. Americans with Disabilities Act The ADA protects both railroad employees and passengers with disabilities. The statute begins with an overarching definition of disability and then separately covers employment 981 Americans with Disabilities Act, 42 U.S.C. § 12101, et seq. See also, ADA.gov., Americans with Disabilities Act of 1990 (as amended), available at: http://www.ada.gov/pubs/adastatute08.htm (last accessed March 31, 2015). 982 United States Department of Labor, Disability Resources, Americans with Disabilities Act, available at: http://www.dol.gov/dol/topic/disability/ada.htm (last accessed March 31, 2015) (last accessed March 31, 2015), hereinafter referred to as âDisability Resources.â
210 discrimination and discrimination by a public entity providing services or benefits.983 Railroad employees are protected under the employment section of the ADA.984 The ADA includes provisions that apply to transportation by rail; for example, 42 U.S.C. § 12142 provides that â[it] shall be considered discrimination ⦠for a public entity which operates a fixed route system to purchase or lease a new ⦠rapid rail vehicle, a new light rail vehicle ⦠if such rail vehicle is not readily accessible to and usable by individuals with disabilities.â985 When purchasing or leasing a used vehicle for use on such a system, the entity is required to make âdemonstrated good faith effortsâ to make the vehicle readily accessible.986 Moreover, § 12162 requires intercity rail transportation to have âat least one passenger car per train that is readily accessible to and usable by individuals with disabilities.â987 The United States Department of Labor, the Equal Employment Opportunity Commission (EEOC), Department of Transportation (DOT), and two other federal agencies enforce the ADA.988 Complementary statutes and regulations, including Transportation Services 983 42 U.S.C. § 12132 (2014). 984 42 U.S.C. § 12112(a) (2014) (âNo covered entity shall discriminate against a qualified individual on the basis of disability in regard to job application procedures, the hiring, advancement, or discharge of employees, employee compensation, job training, and other terms, conditions, and privileges of employment.â) 985 42 U.S.C. § 12132 (a) (2014) (emphasis supplied). 986 42 U.S.C. § 12142(b) (2014). 987 42 U.S.C. § 12162(a)(1) (2014). 988 Disability Resources, supra note 982.
211 for Individuals with Disabilities,989 have been enacted or promulgated, respectively, to effectuate the ADAâs provisions. Cases C. Prima Facie Case of Employment Discrimination under the ADA In Norman v. Union Pacific R.R. Co.,990 involving a train dispatcher whose employment was terminated, the plaintiff alleged that she was terminated in violation of the ADA based on a perceived mental disability. The plaintiff, however, failed to establish a prima facie case.991 A prima facie case for discrimination because of a disability requires three elements: â(1) an ADA- qualifying disability; (2) qualifications to perform the essential functions of her position with or without reasonable accommodation; and (3) an adverse employment action due to her disability.â992 Norman did not satisfy the third element for a prima facie case because Union Pacific demonstrated that Normanâs termination was the result of her failure to submit a release from a physician stating that she could return to work after recovering from physical ailments.993 The companyâs alleged mischaracterization of Normanâs illness as a mental disability did not eliminate the third element that the plaintiff had to prove for a prima facie case.994 The Eight 989 49 C.F.R. §§ 37.1-37.215 (2014) (implementing parts of the ADA related to transportation, such as prohibiting a transportation entity from imposing special charges on a person with disabilities). 990 606 F.3d 455 (8th Cir. 2010). 991 Id. at 460. 992 Id. at 459. 993 Id. at 460. 994 Id.
212 Circuit agreed that the plaintiff did not establish a prima facie case of disability discrimination and affirmed the district courtâs grant of a summary judgment for Union Pacific.995 D. Disability within the Meaning of the ADA 1. Physical or Mental Impairment that Substantially Limits One or More Major Life Activities In EEOC v. Burlington Northern & Santa Fe Ry. Co.996 the EEOC initiated an action under the ADA on behalf of Thomas Freeman. Freeman had applied for a position of conductor- trainee at BNSF but was rejected because of an alleged weakness in his left arm caused by a previous injury. The EEOC claimed that BNSFâs failure to hire Freeman violated the ADA.997 To prevail, the EEOC had to prove that Freeman was disabled within the meaning of the ADA. One definition of disability in the ADA is âa physical or mental impairment that substantially limits one or more major life activities.â998 The term substantially limited in the context of employment has been interpreted to mean âsignificantly restricted in the ability to perform either a class of jobs or a broad range of jobs in various classes as compared to the average person having comparable training, skills and abilities.â999 Freeman was regarded as being disqualified for train service; however, the court held that the category of train service that included a position as conductor-trainee did not constitute a âclass of jobsâ as the term is used in the ADA. Thus, Freeman was not a person with a disability 995 Id. at 461. 996 211 F. Appx. 682, 683-684 (10th Cir. 2006). 997 Id. at 683-684 998 Id. at 684 (citing 42 U.S.C. § 12102(1)). 999 EEOC, 211 F. Appx. at 684.
213 within the meaning of the statute.1000 The Tenth Circuit agreed with the district courtâs determination that when âan individual cannot perform a specific required task in a particular position or positions but can perform other tasks, he is not considered excluded from a âclass of jobs.ââ1001 The appellate court affirmed the district courtâs grant of a summary judgment for BNSF.1002 2. A Record of or Having Being Regarded as Having an Impairment The ADA defines the term disability to mean with respect to an individual (A) a physical or mental impairment that substantially limits one or more major life activities of such individual; (B) a record of such an impairment; or (C) being regarded as having such an impairment (as described in paragraph (3)).1003 Coale v. Metro-North Railroad Co.1004 illustrates the significance of the ADA amendments in 2008. In Coale, the plaintiff, an assistant conductor, was injured in September 2002 while stepping off a train at work.1005 Coale was unable to work for approximately eight and one-half months but was cleared to return to full-duty without medical restrictions in June 2003.1006 Among the issues in the case was Coaleâs desire to obtain a position as a training 1000 Id. at 686. 1001 Id. (quoting EEOC v. Burlington N. & Santa Fe Ry. Co., 406 F. Supp.2d 1228, 1237 (W.D. Okla. 2005)). 1002 EEOC, 211 F. Appx. at 687. 1003 42 U.S.C. § 12102(1) (2014). 1004 2014 U.S. Dist. LEXIS 31764, at *1 (D. Conn. 2014). 1005 Id. at *1. 1006 Id. at *1-2.
214 instructor, a position he apparently did not secure because the defendant may have wanted instructors with âaccident-free work historiesâ so that they would be âmore credible.â1007 Coale alleged that he was disabled under the ADA because the defendant regarded him âas having an impairment that substantially limited the major life activity of workingâ¦.â1008 Coaleâs discrimination case was based also on what he said was his record of disability.1009 The court concluded, however, that the plaintiff was not disabled âat the time of the events in question.â1010 Relying on precedent in the Second Circuit, the court held that under the ADA prior the amendments the plaintiff could not be found to have been âregarded byâ Defendant in the relevant time period to have had an impairment âthat substantially limited] one or more of [his] major life activitiesâ pursuant to 42 U.S.C. § 12102(2)(C) (2008) - and that, consequently, Plaintiff cannot succeed in making out a prima facie case of discrimination under the ADA.1011 The court noted, however, that its interpretation of the ADA might not be applicable to events which occurred subsequent to the application of the 2008 Amendments, due to the inclusion of 42 U.S.C. § 12102(3)(A), pursuant to which â[a]n individual meets the requirement of âbeing regarded as having such an impairmentââ for purposes of 42 U.S.C. § 12102(1)(C) âif the individual establishes that he or she has been subjected to an action prohibited under this chapter because of an actual or perceived physical or 1007 Id. at *8. 1008 Id. at *12-13 (citations omitted). 1009 Id. at *13. 1010 Id. at *21. See also, id. at 26-27. 1011 Id. at *33.
215 mental impairment whether or not the impairment limits or is perceived to limit a major life activity.â1012 The court granted the defendantâs motion for summary judgment. 3. Definition of Disability before and after the ADA Amendments In Gaus v. Norfolk S. Ry. Co.1013 a federal court in Pennsylvania examined the âregarded asâ prong both before and after the enactment of the 2008 amendments to the ADA. Gaus was an electrician who had been employed by Norfolk Southern since 2004 and who suffered from various illnesses causing back, joint, and abdominal pains that required him to take time off from work to seek treatment.1014 In the summer of 2008 Gaus received a letter from his doctor stating that he was fit to return to work.1015 Although Norfolk Southern examined his case, in January 2009 the company refused to allow Gaus to return.1016 Because Gaus was still on narcotic medications for pain, Norfolk Southern considered Gausâs use of medication on the job to be a safety issue.1017 However, Norfolk Southern informed Gaus that he could be eligible for more sedentary or clerical positions at the company.1018 Eventually Gausâs pain eased; he no longer needed narcotic pain medications; and Norfolk Southern declared him medically fit to return to 1012 Id. at *24 N 5. 1013 2011 U.S. Dist. LEXIS 111089, at *1 (W.D. Penn. Sept. 28, 2011). 1014 Id. at *4, 6-8. 1015 Id. at *8-9. 1016 Id. at *11. 1017 Id. 1018 Id. at *13.
216 work as an electrician in 2010.1019 For the railroadâs actions prior to January 1, 2009 and the ADA amendments, the court found that Gaus did not have a disability under the ADA. The reason was that Norfolk Southern did not regard Gaus as having an impairment that substantially limited major life activities.1020 As Norfolk Southern did not issue its opinion on the matter until 2009, the court determined that Norfolk Southern viewed Gausâs condition as being temporary, rather than permanent, and did not consider his condition as one that rendered him unable to perform a wide range of jobs.1021 However, for events after January 1, 2009, when the ADA amendments were in effect, the court held that there was a genuine issue of material fact regarding whether Norfolk Southern regarded Gaus as having an impairment.1022 In regard to the 2008 amendments, the court observed: In enacting the ADAAA, Congress rejected the narrow interpretation of disability adopted by the Supreme Court in Toyota Motor, specifically, the Supreme Courtâs standard regarding âsubstantially limits,â finding that this standard âhas created an inappropriately high level of limitation necessary to obtain coverage under the ADA,â and directed the EEOC to revise that portion of its regulations which defines âsubstantially limitsâ as âsignificantly restrictedâ to be consistent with the ADAAA.1023 Thus, under the ADA as amended [a]n individual meets the requirement of âbeing regarded as having such an impairmentâ if the individual establishes that he or she has been subjected to an action prohibited under this chapter because of an actual or perceived physical or 1019 Id. at *32. 1020 Id. at *45. 1021 Id. at *45-47. 1022 Id. at *60-61. 1023 Id. at *50-51 (citations omitted).
217 mental impairment whether or not the impairment limits or is perceived to limit a major life activity.1024 The regulations further provide that an employer must show that an impairment is objectively transitory and minor to establish a defense to a claim of disability discrimination under this test.1025 Bodily pain qualifies as an impairment,1026 a condition that Norfolk Southernâs evidence did not dispute.1027 Furthermore, Gaus presented the order preventing him from returning to work as evidence of an adverse action resulting from his impairment.1028 The court held that a reasonable jury could find that Gaus could have been disabled under the âregarded asâ test of the ADA as amended.1029 Accordingly, the court granted Norfolk Southernâs motion for a summary judgment for the events prior to January 1, 2009, but denied the motion for the events after January 1, 2009. E. Feasibility of Accessibility Modifications for Rail Patrons 1. Alteration of Two Subway Stations Requiring the Installation of Elevators In Disabled in Action of Pennsylvania v. S.E. Pennsylvania Transp. Authority1030 a nonprofit organization for the rights of the disabled challenged the decisions of the Southeastern Pennsylvania Transportation Authority (SEPTA) regarding the authorityâs alteration of two subway stations without installing elevators. The plaintiff complained that the agencyâs action 1024 Id. at *51-52 (citing 42 U.S.C. § 12102(3) (2011)). 1025 Id. at *53. 1026 Id. at *56. 1027 Id. at *57. 1028 Id. at *58. 1029 Id. at *60-61. 1030 655 F. Supp.2d 553, 567 (E.D. Pa. 2009), affâd, 635 F.3d 87, 98 (3d Cir. 2011).
218 would deny disabled individuals equal access to public transit. A federal district court in Pennsylvania held that the installation of the elevators was required to minimize the distance that wheelchair users had to travel compared to members of the general public.1031 The court held that technical feasibility rather than economic feasibility determined whether a facility is being made accessible to disabled patrons.1032 The court held that the alleged need for the cityâs permission to install an elevator did not preclude a finding of feasibility.1033 On appeal, the Third Circuit affirmed the district courtâs decision that elevators were required.1034 2. Feasibility of Accessibility Modifications for a Port Authority Station In HIP, Inc. v. The Port Authority of New York and New Jersey1035 the plaintiffs alleged that the ADA compelled the Port Authority of New York and New Jersey (Port Authority) to make renovations to a train station in such a manner that the station was accessible to the disabled.1036 The ADA and accompanying regulations1037 required that a station be accessible âto the maximum extent feasible.â1038 Because two approaches for making the station accessible 1031 Id. at 566. 1032 Id. at 567. 1033 Id. 1034 Disabled in Action of Pennsylvania, 635 F.3d 87, 98 (3d Cir. 2011). 1035 693 F.3d 345, 353 (3d Cir. 2012). 1036 Id. at 349. 1037 Id. at 351 (citing 42 U.S.C. § 12147(a) and 49 C.F.R. § 37.43(a)(1)). 1038 HIP, Inc., 693 F.3d at 351-352.
219 were feasible, the district court granted the plaintiffsâ motion for a summary judgment and ordered the Port Authority to make certain alterations.1039 On appeal, the issue was whether it would be feasible for the Port Authority to make the station accessible to the handicapped. The Port Authority argued that the accessibility alterations necessitated the acquisition of property not owned by the Port Authority; that the alterations were âtechnically infeasible;â and that the Port Authority possibly would be unable to make the alterations conform to the fire-safety code.1040 The court, however, did not know whether Jersey City, the current owner of the land needed for the accessibility modifications, would cooperate by providing the property to the Port Authority.1041 In reversing and remanding the case, the appellate court held that neither side was entitled to a summary judgment.1042 Articles F. ADA Amendments Act of 2008 As noted, the ADA Amendments Act of 2008 (ADAAA or the Amendments) broadened the definition of disability in response to Supreme Court decisions that had narrowed the definition beyond the original intent of Congress.1043 A law review article argues that [b]y implicitly elevating impairment to protected class status, the ADAAA offers a profound yet still unrealized opportunity for reframing the existing disability 1039 Id. at 350. 1040 Id. at 352. 1041 Id. at 354. 1042 Id. at 352, 358. 1043 Michelle A. Tavis, âImpairment as Protected Status: A New Universality for Disability Rights,â 46 Ga. L. Rev. 937, 938 (2012), hereinafter referred to as âTavis.â
220 rights debate around a new form of universality that could meaningfully advance the disability rights movement.1044 The article discusses a 2008 case, Middleton v. CSX Transportation, Inc.,1045 in which the plaintiff Middleton alleged that CSX ârefused to hire him as a freight conductor because he was morbidly obese.â1046 Because the case arose prior to the ADA Amendments, the plaintiff had to produce evidence of a âphysiological basis for his weightâ to prove that he had an actual or perceived impairment under the ADA.1047 The article observes that the ADA âmedicaliz[ed]â impairment, thus preventing individuals without proof of any underlying biological problem from successfully asserting an ADA claim.1048 The article argues that the interpretation of impairments as being âonly significant, unusual, and medically recognized biological abnormalitiesâ may hinder the intent of Congress in expanding the âregarded asâ prong in the ADAAA.1049 G. Transportation and Civil Rights A 2013 article by the American Association of People with Disabilities (AAPD) emphasizes the key roles played by transportation and mobility âin the struggle for civil rights 1044 Id. 1045 2008 U.S. Dist. LEXIS 24977, at *1 (N.D. Fla. 2008). 1046 Tavis, supra note 1043, at 964. 1047 Id. 1048 Id. at 965. 1049 Id. at 971.
221 and equal opportunity in the disability community.â1050 According to the AAPD, âaffordable and reliable transportation allows people with disabilities access to important opportunities in education, employment, health care, housing, and community life.â1051 With respect to railroad transportation, the article notes that the ADA requires âall new rail stations and facilitiesâ be accessible and key stations of âpreviously existing rail systems ⦠be made accessible.â1052 1050 American Association of People with Disabilities, Equity in Transportation for People with Disabilities, available at: http://www.aapd.com/resources/publications/transportation-disabilities.pdf (last accessed March 31, 2015) 1051 Id. 1052 Id.
222 III. AMTRAK A. Introduction In 1970, Congress enacted the Rail Passenger Service Act (Amtrak Act) that created the National Railroad Passenger Corporation (Amtrak), a federally funded, private company.1053 In the decades prior to the passage of the Amtrak Act, passenger rail service had become unprofitable because of the increased use of air and automobile transportation in lieu of rail service. By reason of the Amtrak Act, Amtrak replaced most but not all of the providers of intercity passenger rail service. For example, the Alaska Railroad continues to provide intercity passenger rail service independent of Amtrak.1054 Amtrak also gained priority access to the tracks and stations of other private rail companies in exchange for assuming the companiesâ intercity passenger common carrier obligations.1055 A Board of Directors supervises Amtrakâs management; the Board has eight members, one of whom is the Secretary of Transportation, appointed by the President with the approval of the Senate.1056 Since 2003, after a series of financial crises almost forced a shutdown of the passenger rail system, Congress has overseen Amtrakâs appropriations and required DOT approval of federal funds for Amtrak.1057 1053 FRA, Amtrak, available at: https://www.fra.dot.gov/Page/P0052 (last accessed March 31, 2015), hereinafter referred to as âAmtrak.â 1054 Id. For a discussion of the Alaska Railroad Transfer Act, see 45 U.S.C. § 1201 et seq. (2014); see also, Federal Railroad Administration, Privatization of Intercity Rail Passenger Service in the United States, at 20-21 (March 1998), available at: www.fra.dot.gov/eLib/Document/2759 (last accessed March 31, 2015), hereinafter referred to as âPrivatization of Intercity Rail Passenger Service.â 1055 See Amtrak Historical Society, available at: http://www.amtrakhistoricalsociety.org/bah.htm#board (last accessed March 31, 2015). 1056 Id. 1057 FRA, Amtrak Capital Grants, available at: https://www.fra.dot.gov/Page/P0249 (last accessed March 31, 2015).
223 Sections B through D discuss the Amtrak Act and the Passenger Rail Investment and Improvement Act of 2008 (PRIAA), as well as the 1997 repeal of Amtrakâs exclusive franchise. Sections E through H discuss judicial decisions regarding whether Amtrak is a private corporation or a public entity, whether Amtrak is exempt from state public utility rules, and whether other exemptions also may apply to Amtrak. Sections I through K discuss articles that address Amtrakâs exemption from claims under the False Claims Act (FCA), Amtrak tax exemptions, and Amtrak and high-speed rail. Statutes B. Amtrak Act The Amtrak Act defines Amtrak as a ârailroad carrier ⦠operated and managed as a for- profit corporationâ that is ânot a department, agency, or instrumentality of the United States Government.â1058 The statute subjects Amtrak to laws and regulations on safety and employee relations that apply to rail carriers.1059 However, the statute preempts state or local laws related to rates, routes, service, and pay periods.1060 The Act also preempts certain work requirements for employees, laws on joint use or operation of facilities and equipment, and additional taxes on personal and real property and taxes levied after September 30, 1981.1061 1058 49 U.S.C. § 24301(a)(1)-(3) (2014). 1059 See, e.g., 49 U.S.C. § 24301(d) (2014). 1060 49 U.S.C. § 24301(g)-(h) (2014). 1061 49 U.S.C. § 24301(i)-(l) (2014).
224 C. Repeal of Amtrakâs Exclusive Franchise in 1997 A 1998 FRA report on Privatization of Intercity Rail Passenger Service in the United States in a brief history of Amtrak discusses how the Rail Passenger Service Act (RPSA)1062 âprovided Amtrak with the exclusive right to provide intercity rail passenger service over the corridors that it operatedâ but that the âexclusive franchiseâ was repealed in 1997.1063 According to findings in § 2 of S. 738 that was enacted by Congress, some of the reasons for the repeal appear to have included Amtrakâs âfinancial crisis, with growing and substantial debt obligationsâ that severely limited Amtrakâs ability to cover operating costs that jeopardized its long-term viability all of which required âimmediate actionâ if Amtrak were to be able to survive.1064 D. The Passenger Rail Investment and Improvement Act of 2008 Under the Amtrak Act, Amtrak received dispatching priority over freight trains in exchange for assuming freight companiesâ passenger common carrier obligations. In 2008, the Passenger Rail Investment and Improvement Act or PRIAA was enacted in response to Amtrakâs unreliable passenger service in part because of some freight rail companiesâ apparent disregard of federal law.1065 PRIIA authorized the STB to penalize private freight companies that caused Amtrak to fail to achieve certain goals.1066 1062 45 U.S.C. §§ 501-502, et seq. (repealed), subsequently recodified at 49 U.S.C. 24101, et seq. (2014). 1063 Privatization of Intercity Rail Passenger Service, supra note 1054, at 4. 1064 Available at: https://www.govtrack.us/congress/bills/105/s738 (last accessed March 31, 2015). 1065 Bradon Smith, âChanging Signals: A New Approach to the Enforcement of Rail Passenger Traffic Preference in Response to the Passenger Rail Investment and Improvement Act of 2008,â 38 Iowa J. Corp. L. 441, 442 (2013), hereinafter referred to as âSmith.â 1066 Id. at 451.
225 PRIIA tasked Amtrak and other stakeholders with improving Amtrakâs service, operations, and facilities in respect to its long-distance routes and the Northeast Corridor (NEC), state-sponsored corridors, and the development of high-speed rail corridors.1067 PRIIA authorized âgrants to Amtrak to cover operating costs, capital investments, including in part, efforts to bring the NEC to a state-of-good-repair, and repayment of Amtrakâs long-term debt and capital leasesâ¦.â1068 Besides implementing a modern financial accounting and reporting system, Amtrak was required to have a 5-year financial plan that addressed at least sixteen categories of information. PRIIA also required the FRA and Amtrak, in cooperation with the STB, âto develop metrics and minimum standards for measuring the performance and service quality of intercity passenger train serviceâ¦.â1069 However, as noted in a 2014 Report by Amtrakâs Office of the 1067 Federal Railroad Administration Overview, Highlights and Summary of the Passenger Rail Investment and Improvement Act of 2008 (PRIIA), at 1 (prepared March 10, 2009), available at: https://www.fra.dot.gov/eLib/Details/L02830 (last accessed March 31, 2015), hereinafter referred to as âFRA Summary of PRIIA.â See Smith, supra note 1065, at 451, who states: The PRIIA offered a new regulatory mandate and a new administrative remedy to address commercial freight railroadâs noncompliance with federal law. Section 210 of the PRIIA mandated that the FRA and the governing STB, in consultation with Amtrak, propagate new and improved metrics. The new metrics would measure on-time performance, avoidable delays, cost per passenger to prevent further delays, and intercity connectedness. The PRIIA also permitted the STB to administer penalties when it determined Amtrakâs failing to meet goals was traceable to freight interference. (footnotes omitted); and Justin J. Marks, âNo Free Ride: Limiting Freight Railroad Liability When Granting Right-of-Way to Passenger Rail Carriers,â 36 Transp. L. J. 313, 331-332 (2009), who states that âPRIAA authorizes the Surface Transportation Board to conduct nonbinding mediation between the parties if after a âreasonable period of negotiation, a public transportation authority cannot reach agreement with a rail carrierâ for shared usage of track. The Board is to model the mediation from its current process it uses to settle rate casesâ). 1068 FRA Summary of PRIIA, supra note 1054, at 1 (citing PRIIA §§ 101 and 102). 1069 Id. at 2 (citing PRIIA § 207).
226 Inspector General (Amtrak OIG Report), in July 2013 the District of Columbia Circuit âruled that the performance metrics and standards developed under PRIIA were not enforceable.â1070 In June 2014 the Supreme Court granted certiorari.1071 As discussed in the next subpart of the Report, on March 9, 2015, the Supreme Court reversed and remanded the case to the Court of Appeals. In regard to the Intercity Passenger Rail Route Structure, Amtrak was ârequired to evaluate and rank each of its long distance trains according to its overall performance as belonging to the best performing third of such routes, the second best performing third of such routes or the worst performing third of such routesâ¦.â1072 For Northeast Corridor Facility and Service Improvement, PRIIA required Amtrak in consultation with others to prepare a capital spending plan for needed infrastructure projects.1073 PRIIA also required enhanced state involvement by tasking states to establish or designate a state rail transportation authority to develop statewide rail plans.1074 1070 Amtrak OIG Report, âPassenger Rail Investment and Improvement Act of 2008: Accomplishments and Requirements that Deserve Consideration for Future Authorizing Legislation,â at Report Highlights (Jan. 2014), available at: http://www.amtrakoig.gov/sites/default/files/reports/oig-a-2014-003.pdf (last accessed March 31, 2015), hereinafter referred to as âAmtrak OIG Report.â See Association of American Railroads v. United States Depât of Transp., 721 F.3d 666, 669 (D.C. Cir. 2013), rehearing, en banc, denied, 2013 U.S. App. LEXIS 20745 (D.C. Cir., Oct. 11, 2013), cert. granted, DOT v. Assân of Am. R.R., 134 S. Ct. 2865, 189 L. Ed.2d 805 (2014). 1071 Dept. of Transportation v. Assân of American Railroads, 134 S. Ct. 2865, 189 L. Ed.2d 805 (2014). 1072 FRA Summary of PRIIA, supra note 1067, at 2 (citing PRIIA § 210). 1073 Id. (citing PRIIA § 211). 1074 Id. at 3 (citing PRIIA § 303).
227 PRIIA authorized three new federal intercity rail capital assistance programs: one for the Intercity Passenger Rail Service Corridor Capital Assistance Program, one for High-Speed Rail Corridor Development, and one for congestion relief.1075 PRIIA also established opportunities for private sector interests.1076 Among other features of PRIIA, Amtrak was directed to study ADA âaccessibility needs at the stations it serves and to identify improvements required to bring those stations into compliance with ADA requirements, including a detailed plan, schedule and recommendations for funding the necessary improvements.â1077 Finally, the aforementioned Amtrak OIG Report stated, inter alia, that Amtrak had successfully restructured Amtrakâs debt on 13 capital leases.1078 Cases E. Private Corporation or Public Entity? The issue of Amtrakâs status as defined in 49 U.S.C. § 24301 has been litigated most recently in a case decided by the United States Supreme Court on March 9, 2015, in which the Court reversed and remanded a decision by the District of Columbia Circuit in Department of Transportation v. Association of American Railroads.1079 1075 Id. at 4-5 (citing PRIIA §§ 301, 501, and 302, respectively). See also, Joshua Rogers, âThe Great Train Robbery: How Statutory Construction May Have Derailed an American High Speed Rail System,â 2011 U. Ill. J.L. Tech. & Polây 215, 229 (2011) (stating that â[s]ection 501 of Public Law 110-432, commonly referred to as the Passenger Rail Investment and Improvement Act of 2008 (PRIIA), is the section of the law that deals specifically with high speed rail corridorsâ). 1076 Id. at 5 (citing PRIIA §§ 214-216, 502). 1077 Id. at 6 (citing PRIIA § 219). 1078 Amtrak OIG Report, supra note 1070, at 4. 1079 135 S. Ct. 1225, 191 L. Ed.2d 153, 2015 U.S. LEXIS 1763 (U.S., Mar. 9, 2015).
228 1. Decision by the District of Columbia Circuit In Association of American Railroads v. United States Department of Transportation,1080 the Association of American Railroads (AARR) argued that that § 207 of PRIIA was unconstitutional. Section 207 empowered Amtrak and the FRA âto jointly develop performance measures to enhance enforcement of the statutory priority Amtrakâs passenger rail service has over other trains.â1081 First, the District of Columbia Circuit held that Amtrak is a private corporation, because âCongress has both designated it a private corporation and instructed that it be managed so as to maximize profit.â1082 As for § 207 of PRIIA, the court held that the section was unconstitutional on two grounds. The first ground was that no case has permitted a private company to have regulatory power equal to that of an administrative agency.1083 As for the second ground, the court explained that § 207 directs the FRA and Amtrak to ââjointly ⦠develop new or improve existing metrics and minimum standards for measuring the performance and service quality of intercity passenger train operations, including cost recovery, on-time performance and minutes of delay, ridership, on-board services, stations, facilities, equipment, and other services.ââ1084 However, if the FRA and Amtrak disagreed over âthe composition of these âmetrics and standards,â either âmay petition the [STB] to appoint an arbitrator to assist the 1080 721 F.3d 666, 670 (D.C. Cir. 2013), rehearing denied, 2013 U.S. App. LEXIS 20746 (D.C. Cir., Oct. 11, 2013), rehearing, en banc, denied, 2013 U.S. App. LEXIS 20745 (D.C. Cir., Oct. 11, 2013), vacated and remanded, Depât of Transp. v. Assân of Am. R.R., 135 S. Ct. 1225, 191 L. Ed.2d 153, 2015 U.S. LEXIS 1763, at *1 (U.S., Mar. 9, 2015). 1081 Id. at 668. 1082 Id. at 674, 677. 1083 Id. at 673. 1084 Id. at 699 (quoting PRIIA § 207(a), 49 U.S.C. § 24101 (note)).
229 parties in resolving their disputes through binding arbitration.ââ1085 Furthermore, ââ[t]o the extent practicable,â Amtrak and its host rail carriers must incorporate the metrics and standards into their Operating Agreements.â1086 Because the arbitration clause did not prohibit a private actor from being appointed as arbitrator, the court held that § 207 would permit âmetrics and standards to go into effect that had not been assented to by a single representative of the government.â1087 In reversing the district courtâs grant of a summary judgment for the DOT, the appeals court held that the statute was an unconstitutional delegation of regulatory power to a private entity.1088 2. Decision by the United States Supreme Court On March 9, 2015, the Supreme Court unanimously reversed the decision of the District of Columbia Circuit and remanded in an opinion by Justice Kennedy in which Justice Thomas filed a concurring opinion.1089 The Court held that âfor purposes of determining the validity of the metrics and standards[] Amtrak is a governmental entity.â1090 After making specific findings regarding Amtrakâs structure, ownership, and governance, the Court summarized the reasons for its holding: Given the combination of these unique features and its significant ties to the Government, Amtrak is not an autonomous private enterprise. Among other important considerations, its priorities, operations, and decisions are extensively 1085 Id. (quoting PRIIA § 207(d), 49 U.S.C. § 24101 (note)). 1086 Id. (quoting PRIIA § 207(c), 49 U.S.C. § 24101 (note)). 1087 Id. at 674. 1088 Id. at 677. 1089 135 S. Ct. 1225, 191 L. Ed.2d 153, 156, 2015 U.S. LEXIS 1763, at *1 (U.S., Mar. 9, 2015). 1090 2015 U.S. Lexis 1763 at * 6.
230 supervised and substantially funded by the political branches. ⦠Amtrak was created by the Government, is controlled by the Government, and operates for the Governmentâs benefit. Thus, in its joint issuance of the metrics and standards with the FRA, Amtrak acted as a governmental entity for purposes of the Constitutionâs separation of powers provisions. 1091 The Court relied on its decision in Lebron v. National Railroad Passenger Corp.1092 that âteaches, that âfor purposes of Amtrakâs status as a federal actor or instrumentality under the Constitution, the practical reality of federal control and supervision prevails over Congressâ disclaimer of Amtrakâs governmental status.â1093 On remand, the Court of Appeals, âafter identifying the issues that are properly preserved and before it,â1094 will need to address the âsubstantial questions respecting the lawfulness of the metrics and standards--including questions implicating the Constitutionâs structural separation of powers and the Appointments Clause, U. S. Const., Art. II, § 2, cl. 2â that are still present in the case.1095 F. Exemption of Amtrak from State Public Utility Rules City of New York v. Amtrak,1096 decided by a federal court in the District of Columbia, is a recent case clarifying 49 U.S.C. § 24301(g). The case arose out of New York Cityâs claim that a 1906 deed that transferred title to land, which supported a bridge, from the city to a predecessor of Amtrak obligated Amtrak to maintain the bridge in perpetuity. The parties disagreed over 1091 Id. at *17. 1092 513 U. S. 374, 115 S. Ct. 961, 130 L. Ed.2d 902 (1995). 1093 Id. at *19. 1094 Id. at *20. 1095 Id. at *6. 1096 960 F. Supp.2d 84 (D.D.C. 2013).
231 âwhether this agreement was an affirmative covenant running with the land or merely a contract.â1097 Section 24301(g) provides that ââ[a] state or other law related to rates, routes, or service does not apply to Amtrak in connection with rail passenger transportation.ââ1098 As for whether the statute preempted any agreement on the cost of maintaining the bridge, the court ruled in favor of Amtrak because the Regional Rail Reorganization Act of 1973 (3R Act) required that all land be âconveyed free and clear of any liens or encumbrances.â1099 The city, however, also argued that Amtrak was responsible for the cost of removing its electrical equipment based on New Yorkâs public utility rule that required public service corporations ââto relocate their structures at their own expense whenever the public health, safety or convenience requires the change to be made.ââ1100 The city argued that when Amtrak attached its electrical facilities to the bridge Amtrak assumed the ââthe risk of their location and is bound to make such changesââ as required by the rule at its own expense.1101 Because the city had paid Amtrak to remove the equipment, the city sought to recover the funds that the city had paid to Amtrak. The court held that the applicability of Amtrak preemption depended on âwhether [the public utility] rule ⦠is ârelated to ⦠routes,â and whether the City seeks to apply that rule âto Amtrak in connection with rail passenger transportation.ââ1102 The court held that neither 1097 Id. at 86. 1098 Id. at 95 (quoting 49 U.S.C. § 24301(g)). 1099 City of New York v. Amtrak, 960 F. Supp.2d at 90. 1100 Id. at 94 (citation omitted). 1101 Id. at 95 (citation omitted). 1102 Id. at 96 (citation omitted).
232 requirement was satisfied because the public utility rule would only impose a cost on Amtrak without â[altering] the course of the trains [or subjecting] the railroad company to the vagaries of varied local ordinances.â1103 Although the court held that the public utility rule was not preempted, the court, nevertheless, ruled in favor of Amtrak.1104 The courtâs reasoning was that âno reasonable jury could find that the danger presented by the ongoing bridge decay was sufficiently acute and severe to justify recovery under the emergency assistance doctrineâ relied on by the city.1105 G. Preemption of a Negligence Claim Relating to Service but not of a Claim for Negligent Design of a Railcar In Rubietta v. Amtrak1106 the plaintiff brought an action for damages for personal injuries that she sustained as a passenger on an Amtrak train. One issue was whether the Amtrak Act preempted her claims under state law for negligence arising out of a railcarâs design and seating.1107 Under the Act, ââ[a] State or other law related to ⦠service does not apply to Amtrak.ââ1108 The court interpreted the term service to include âitems such as ticketing, boarding procedures, provision of food and drink, [and] baggage handling, in addition to the transportation itselfâ¦.â1109 The court held that the plaintiffâs claim for negligent seating was 1103 Id. at 97. 1104 Id. 1105 Id. at 99. 1106 2012 U.S. Dist. LEXIS 12047, at *1 (N.D. Ill. Jan. 30, 2012). 1107 Id. at *9-11. 1108 Id. at *11 (quoting 49 U.S.C. § 24301(g). 1109 Id. at *11-12.
233 preempted because the claim related to service.1110 However, because the Americans with Disabilities Act neither has an express preemption provision that may be applied to railcar design nor has the Act occupied the field of railcar safety, the court held that the negligent design claim was not preempted.1111 H. Express and Implied Preemption of Condemnation of Amtrak Property In Amtrak v. McDonald1112 Amtrak sued the Commissioner of the New York State Department of Transportation because of its condemnation of six parcels of Amtrakâs land and its pending condemnation of a seventh parcel for a project in the South Bronx.1113 Amtrak moved for a summary judgment because the Commissionerâs actions were âimpliedly preemptedâ by the Regional Rail Reorganization Act of 1973 (3R Act) and the Rail Passenger Service Act (RPSA); âbecause the federal government has occupied the field of ownership and control of Amtrak property;â and because of 49 U.S.C. § 24902(j) (the federal enclave provision) and 49 U.S.C. § 24301(g) of the RPSA.1114 Furthermore, the Commissionerâs actions would impair âthe federal governmentâs mortgage interest in the property[] in violation of the Property Clause of the Constitution.â1115 1110 Id. at *12. 1111 Id. at *9-11. 1112 2013 U.S. Dist. LEXIS 144107, at *1 (S.D.N.Y. Sept. 26, 2013). 1113 Id. at *1-2. 1114 Id. at *23. 1115 Id.
234 However, the court granted McDonaldâs motion for summary judgment on procedural grounds.1116 First, because the Eleventh Amendment entitled the defendant to sovereign immunity, the court ruled that it lacked subject matter jurisdiction over claims regarding the six parcels already condemned.1117 Moreover, because Amtrak was seeking retroactive relief for an alleged violation of federal law that was not ongoing, the rule in Ex parte Young did not apply.1118 Finally, the court held that either or both of two applicable statutes of limitation barred Amtrakâs claim on the last parcel that the Commissioner was in the process of condemning.1119 Articles I. Amtrak Exemption from Claims under the False Claims Act An article in Recent False Claims Act & Qui Tam Decisions discusses the applicability of the False Claims Act (FCA) to Amtrak.1120 The FCA imposes liability for âknowingly present[ing], or caus[ing] to be presented, a false or fraudulent claim for payment or approvalâ from or by the federal government.1121 In discussing FCA lawsuits against Amtrak and other entities,1122 the article notes United States ex rel. Totten v. Bombardier Corp.1123 Totten brought 1116 Id. at *2. 1117 Id. at *25. 1118 Id. at *27. 1119 Id. at *67, 68, 70-71. 1120 Taxpayers against Fraud (TAF) Education Fund, âRecent False Claims Act & Qui Tam Decisions,â 35 False Cl. Act and Qui Tam Q. Rev. 3 (Oct. 2004), hereinafter referred to as âRecent FCA Claims.â 1121 31 U.S.C. § 3729(a) (2014). See also, U.S. Department of Justice, The False Claims Act: A Primer, available at: http://www.justice.gov/civil/docs_forms/C-FRAUDS_FCA_Primer.pdf (last accessed March 31, 2015). 1122 E.g., United States ex rel. Yesudian v. Howard Univ., 153 F.3d 731 (D.C. Cir. 1998); United States v. Harvard Coll., 323 F.Supp.2d 151 (D. Mass. 2008).
235 a qui tam suit against Bombardier Corporation that had contracted with Amtrak to provide Amtrakâs rail cars with new toilet systems.1124 Totten alleged that Bombardier knowingly delivered defective cars and later submitted âinvoices to Amtrak for payment from an account that included federal funds.â1125 However, the district court granted Amtrak a summary judgment because Bombardier never presented a false claim to the government.1126 On appeal, the District of Columbia Circuit affirmed the district courtâs decision.1127 â[T]he FCA contains a âpresentment requirement,â requiring claims to be âpresented to an officer or employee of the Government before liability can attach.â1128 However, the Amtrak Act provides that Amtrak is âânot a department, agency, or instrumentality of the United States Governmentââ1129 and thus bars FCA suits against Amtrak.1130 Thus, the appellate courtâs decision effectively exempts Amtrak from FCA actions in spite of Amtrakâs federal ties because Amtrak does not qualify as âthe Government.â1131 1123 380 F.3d 488 (D.C. Cir. 2004), cert. denied, 2005 U.S. LEXIS 3967 (U.S., May 16, 2005), superseded by statute as stated in United States v. Carell, 782 F. Supp.2d 553, 2011 U.S. Dist. LEXIS 28965 (M.D. Tenn. 2011). See Department of Transportation v. Association of American Railroads, 135 S. Ct. 1225, 191 L. Ed.2d 153, 2015 U.S. LEXIS 1763 at * 1, 6 (U.S., March 9, 2015) in which the Supreme Court held for purposes of § 207 of the Passenger Rail Investment and Improvement Act (PRIAA) that Amtrak was a âgovernmental entity.â 1124 Totten, 380 F.3d at 490. 1125 Id. 1126 Id. 1127 Id. 1128 Recent FCA Claims, supra note 1120. 1129 Id. at 491 (quoting 49 U.S.C. § 24301(a)(3)). 1130 Recent FCA Claims, supra note 1120. 1131 Id. at 490.
236 J. Amtrak Tax Exemption A law review article discusses the Amtrak tax exemption.1132 The article analyzes a dispute over public utility costs that gave rise to a series of lawsuits by the Pennsylvania Public Utility Commission (PUC) beginning with the PUCâs suit against Amtrak for a contribution toward the cost of maintaining safety at railway crossings.1133 The litigation resulted in a âset of conflicting decisionsâ involving Pennsylvania and the federal courts.1134 Opinions were divided on whether âAmtrakâs immunity from local âtaxes or other feesâ ⦠extends to assessments for local improvements of the kind at issue here.â1135 The article argues that although state courts correctly noted the differences between a tax and the costs at issue, the federal courtâs broad interpretation was âconsistent with the presumed congressional intent to minimize state taxes and fees on Amtrak.â1136 K. High-Speed Rail Projects An article on high-speed rail (HSR) projects argues that if Amtrak wishes to begin more HSR projects, Amtrak is uniquely positioned regarding certain real property issues.1137 The 1132 Symposium, âA Case of Irreconcilable Differences with the Federal District Court: An Agency Caught in a Judicial Vise Grip,â 21 Widener L.J. 213 (2011). 1133 Id. at 214. 1134 Id. at 213. 1135 Id. at 214. 1136 Id. at 226 (discussing National Railroad Passenger Corp. v. Pennsylvania Public Utility Commission (Amtrak IV), 342 F.3d 242, 246 (3d Cir. 2003)). 1137 Darren A. Prum and Sarah L. Catz, âHigh-Speed Rail in America: An Evaluation of the Regulatory, Real Property, and Environmental Obstacles a Project Will Encounter,â13 N.C. J.L. & Tech. 247 (2012).
237 article discusses the governmentâs recent allocation of significant resources to HSR projects1138 and the governmental, real property, environmental, and policy issues that accompany such projects.1139 Because of Amtrakâs ability to use existing right of ways or privately owned freight tracks for future HSR projects, the article contends that Amtrak is uniquely situated.1140 The article states that because other operators would be at the mercy of the private freight companies Amtrak has âdistinct cost advantagesâ for HSR projects.1141 1138 Id. at 248-249. 1139 Id. at 250. 1140 Id. at 268-269. 1141 Id. at 269.
238 IV. BUY AMERICA ACT A. Introduction A 2015 NCRRP Report, entitled âBuy America Requirements for Federally Funded Rail Projects,â1142 summarized briefly in this part of the Report, is an authoritative, comprehensive study of the Buy America requirements applicable to federal grants for passenger and freight rail development.1143 The Report provides a detailed history of the Buy America statutes, beginning with the original Buy America Act enacted in 1933.1144 B. General Statutory Issues The Report discusses the statutory issues and differences among the various Buy America provisions, including their coverage and applicability; exceptions, exclusions, and waivers; and bid certification and potential penalties, as well as multiple funding sources with a Buy America provision applicable to a project.1145 For example, in regard to multiple funding sources, the Report cautions that âgrant recipients must be cognizant of situations in which multiple Buy America provisions apply to a project,â including state and local provisions.1146 C. Buy America Provisions and the Federal Railroad Administration Although in 2008 Congress enacted a Buy America provision applicable to the Federal Railroad Administration (FRA) for the High-Speed Intercity Passenger Rail (HSIPR) program, 1142 Timothy R. Wyatt, âBuy America Requirements for Federally Funded Rail Projects,â NCRRP Legal Research Digest 1 (2015), available at: http://onlinepubs.trb.org/Onlinepubs/ncrrp/ncrrp_lrd_001.pdf (last accessed March 31, 2015). 1143 Id. at 3. 1144 Id. 1145 Id. at 4-9. 1146 Id. at 9.
239 the Report points out that since 1978 the âFRA has also been responsible for administering the Amtrak Buy America provision applicable to procurements made by Amtrak with funds from its capital grant.â1147 The Report, first, discusses in some detail the FRA HSIPR Buy America provision, including coverage and applicability, exceptions and waivers, and certification and enforcement.1148 The Report observes that [t]he FRA Buy America provision does not include any express requirements for enforcement by FRA grant recipients. However, FRA has published a list of actions that FRA grant recipients âneed to doâ to demonstrate compliance with the FRA Buy America provision.1149 The section also notes that a project may have multiple funding sources with each having a Buy America provision.1150 The Report points out that the âFRA has yet to issue regulations for administering the FRA Buy America provision. This is somewhat problematic from a legal perspective, in part because waivers of the FRA Buy America provision are discretionary.â1151 However, there is some interim guidance as discussed in the Report.1152 The Report also includes a helpful section entitled âWaiver Case Studies.â1153 1147 Id. 1148 Id. at 9-14. 1149 Id. at 13 (footnote omitted). 1150 Id. at 13 and 21. 1151 Id. at 16. 1152 Id. at 18. 1153 Id. at 20-26.
240 Second, the Report discusses the Amtrak Buy America provision, noting that since 1978 âAmtrak has been subject to a statutory domestic preference ⦠which applies to Amtrakâs direct purchases using its federal fundsâ1154 and provides an analysis similar to the analysis of the FRA HSIPR Buy America provision (e.g., coverage and applicability, exceptions and waivers, and certification and enforcement).1155 Case studies are included also. D. Buy America Provisions and the Federal Transit Administration The Report analyzes the Buy America provision applicable to the Federal Highway Administration (FHWA),1156 followed by an explanation of the Buy America provision that applies to the Federal Transit Administration (FTA).1157 Once more, the Report analyzes the Buy America provisionâs coverage and applicability, exceptions and waivers, certification and enforcement, and other issues including when there are multiple funding sources with a Buy America provision.1158 The Report covers the 2005 legislative revision or update of the FTA Buy America provision.1159 The publication also includes a section with case studies.1160 1154 Id. at 26 (footnote omitted). 1155 Id. at 26-33. 1156 Id. at 39-52. 1157 Id. at 52. 1158 Id. at 52-57. 1159 Id. at 57 (footnote omitted). 1160 Id. at 69-72.
241 Although, as noted, the FRA to date has not promulgated Buy America regulations the FTAâs âregulations and administrative history are so voluminous that research is often required to determine how to apply the various waivers to a given procurement.â1161 1161 Id. at 72.
242 V. CARMACK AMENDMENT AND LIABILITY FOR LOST OR DAMAGED GOODS A. Introduction When a train transporting cargo derails, for example, many issues may arise under the Carmack Amendment concerning a carrierâs liability. Section B discusses statutes and regulations on the Carmack Amendment and the liability of railroads. Section C addresses the applicability of the Carmack Amendment and issues such as preemption of all claims under state law, when an intrastate shipment is part of an interstate shipment, and claims against an originating rail carrier in the judicial district where the point of origin is located. Section D discusses the applicability of the Carriage of Goods by Sea Act (COGSA) and the Harter Act. Sections E through G consider whether the Carmack Amendment applies when the parties contract otherwise, the rule applicable to an international shipment on a through bill of lading when a freight forwarder contracts for the inland rail portion, and the effects of covenants not to sue in a through bill of lading. Because there are several articles that criticize laws limiting the liability of railroads, Section H summarizes articles that discuss whether there is a need for a uniform law, whether the Carmack Amendment applies to intermodal exports, and whether the Supreme Court has misinterpreted the plain language of the Carmack Amendment and COGSA. Statutes and Regulations B. The Carmack Amendmentâs Effect on the Liability of Railroad Carriers A railroadâs liability for lost or damaged goods is subject to several laws governing interstate transportation. Although the Carmack Amendment is the most relevant statute affecting railroad liability, COGSA and the Harter Act may be implicated when multimodal transportation includes an inland rail segment to transport goods. Furthermore, in intermodal
243 transportation intermediary carriers may create by contract their own terms of liability with an initial carrier, thus allowing them to opt out of the aforementioned statutory provisions. Congress enacted the Carmack Amendment in 1906 to amend the Interstate Commerce Act.1162 The Amendment creates a uniform system for interstate shippers to recover for actual loss or injury to property caused by carriers.1163 The Amendment contains separate but similar provisions that limit the liability of railroads, motor carriers, water carriers, brokers, and freight forwarders.1164 The provisions insulate carriers from liability from claims that could result in an award of damages in excess of the value of the property that was lost or damaged.1165 Although the Carmack Amendment limits the liability of a carrier to the value of the damaged goods, the Amendment imposes strict liability on common carriers for goods that are lost, damaged, or not delivered on time, thus preempting state and common law claims in these instances.1166 Section 11706 of the Carmack Amendment imposes liability on railroad carriers for âthe actual loss or injury to property caused by (1) the receiving rail carrier; (2) the delivering rail carrier; or (3) another rail carrier over whose line or route the property is transported.â1167 A rail 1162 See 49 U.S.C. §§ 11706 and 14706 (2014). 1163 Patricia O. Alvarez and Marc J. Yellin, âWhere to Start with a Motor Carrier Cargo Claim,â Trucking Law Committee (Feb. 2006), available at http://www.dkslaw.com/articles/Trucking_CargoClaim.pdf (last accessed March 31, 2015), hereinafter referred to as âAlvarez and Yellin.â See also 49 U.S.C. § 11706 (2014). 1164 See 49 U.S.C. §§ 11706, 14706 (2014). 1165 Alvarez and Yellin, supra note 1150, at 29. 1166 Id. 1167 49 U.S.C. § 11706(a)(1)-(3) (2014).
244 carrier that issues a bill of lading or that delivers the goods may recover the amount owed to the owners of the goods from the rail carrier over whose rail where the destruction or damage to the property occurred.1168 The Amendment also provides a cause of action against âthe originating rail carrier ⦠the delivering rail carrier ⦠and the carrier alleged to have caused the loss or damage.â1169 But the Amendment allows railroads to limit their liability, first, by allowing trains carrying passengers to limit their liability under their passenger rates for loss of or damage to baggage1170 and, second, by allowing railroads to limit liability for transported property to the value established by written agreement between a shipper and a carrier.1171 The details on railroad liability under the Carmack Amendment are set forth in parts 1005 and 1035 of Title 49 of the Code of Federal Regulations.1172 Part 1005 applies to the processing of claims and specifically includes all railroads that are subject to the Interstate Commerce Act.1173 Part 1035 describes the requirements for bills of lading for common carriers.1174 1168 49 U.S.C. § 11706(b) (2014). 1169 49 U.S.C. § 11706(d)(2)(i)-(iii) (2014). 1170 49 U.S.C. § 11706(c)(2) (2014). 1171 49 U.S.C. § 11706(c)(3)(A) (2014). 1172 49 C.F.R. §§ 1005.1 and 1035.1 (2014). 1173 49 C.F.R. § 1005.1 (2014) 1174 49 C.F.R. § 1035.1 (2014).
245 Cases C. Applicability of the Carmack Amendment 1. Preemption of all Claims under State Law The Carmack Amendment bars all claims that would permit a railroad to be held liable under state law.1175 In Gulf Rice Arkansas, LLC v. Union Pacific R.R. Co.1176 the shipper Gulf Rice Arkansas, LLC. (Gulf Rice) brought an action in a state court against the railroad carrier Union Pacific and its agent for the loss of railcars containing beans that were being shipped into Mexico. Gulf Rice alleged that it orally directed the carrier not to ship the remaining three railcars of beans, but the carrier shipped them anyway; the products were either confiscated or lost during shipment.1177 The shipper sued the carrier for breach of contract, negligence, breach of bailment, conversion, and for its liability as a common carrier. The state claims were barred based on Congressâs intent that the Carmack Amendment would âprovide the exclusive cause of action for loss or damages to goods arising from the interstate transportation of those goods by a common carrier.â1178 Only a suit for a common carrierâs obligation under the Carmack Amendment was extant.1179 Therefore, Congressâs intent in enacting the Carmack Amendment and its goal in providing uniformity are relevant to the liability of a railroad company under the Carmack Amendment. 1175 Gulf Rice Arkansas, LLC v. Union Pacific R.R. Co., 376 F. Supp.2d 715, 719 (S.D. Tex. 2005). 1176 Id. at 717. 1177 Id. at 719. 1178 Id. 1179 Id.
246 2. Intrastate Shipment that was Part of an Interstate Shipment In Chartis Mexico, S.A. v. HLI Rail & Rigging, LLC1180 a shipperâs property was damaged severely when a rail carrier operating a train between two Texas cities derailed.1181 The shipment had originated in Mexico and the second segment was entirely within Texas on a separate bill of lading.1182 The court held that the Carmack Amendment applied because the partiesâ bills of lading did not constitute an agreement that would exempt the shipment from Carmackâs default rules on liability.1183 When the bills of lading for overseas transport ends at a United States port and the cargo owners then contract with another carrier for the inland portion of the transport, the Carmack Amendment applies.1184 The court distinguished intrastate transport from shipments originating overseas under a single through bill of lading. In the latter case, the initial carrier is liable for the inland portion of the transportation and thus may be exempt from the Carmack Amendment.1185 In a subsequent opinion and order the district court granted summary judgment to HLI Rail & Rigging, LLC on Kansas City Southern Railway Co.âs (KCSR) cross-claim for indemnity against HLL. The court stated that 1180 Chartis Mexico, S.A. v. HLI Rail and Rigging, LLC, 2014 U.S. Dist. LEXIS 33745, at *1, 35-36 (S.D.N.Y. March 13, 2014) (stating that ââCongressâs authority to regulate even intrastate aspects of the operation of railroads is beyond questionââ) (citation omitted), on reconsideration by, modified by, in part, summary judgment granted in part, 2015 U.S. Dist. LEXIS 15909 (S.D.N.Y., Feb. 9, 2015). 1181 Id. at *5-6. 1182 Id. *37, 40. 1183 Id. at *32. 1184 Id. at *32-33. 1185 Id.
247 as it found in the March 13, 2014 Opinion & Order, no reasonable jury could find that the Rules Publication was incorporated into the BOLs. Like other contracts, a bill of lading is generally held to incorporate the terms of an extrinsic document where there is a âspecific referenceâ to that document and âunmistakable languageâ in the bill of lading that the terms in that document have been incorporated.1186 The court further found that âno reasonable jury could conclude that âPrice is subject to 9012â is a sufficiently specific reference to the Rules Publication because it does not cite to the Rules Publication which is merely an internal KCSR document accessible only on its website.â1187 3. Claims Brought against the Originating Rail Carrier in the Judicial District where the Point of Origin is Located The Carmack Amendment allows claims to be brought against originating rail carriers in the judicial district where the point of origin is located.1188 The special venue statute allows one court to exercise control over all claims subject to the Carmack Amendment.1189 In Pacer Global Logistics, Inc. v. Amtrak,1190 a Wisconsin federal district court, which denied a motion to dismiss for improper venue and a motion to transfer, held that the action was filed in the proper venue under the special venue provision as a result of the Carmack Amendment.1191 Pacer Global Logistics, Inc. (Pacer) contracted with Amtrak to transport cargo from Wisconsin to 1186 Chartis Mexico, S.A. v. HLI Rail and Rigging, LLC, 2015 U.S. Dist. LEXIS 15909, at *1, 9 (S.D.N.Y., Feb. 9, 2015). 1187 Id. at *10. 1188 49 U.S.C. § 11706(d)(2)(A) (2014). 1189 Pacer Global Logistics, Inc. v. Amtrak, 272 F. Supp.2d 784, 788 (E.D. Wis. 2003). 1190 72 F. Supp.2d 784 (E.D. Wis. 2003). 1191 Id. at 789.
248 California, but an earthquake that occurred while the cargo was in transit caused a railcar carrying Pacerâs cargo to derail.1192 During discovery Pacer learned that the damage to the cargo did not occur when the rail car derailed but when Amtrak and the other defendants attempted to re-rail the rail car.1193 Claims under the Carmack Amendment may be âbrought against the originating rail carrier âin the judicial district in which the point of origin is located.ââ1194 The court held that the claims against the non-railroad defendant were properly brought in that district in spite of the fact that the usual venue would have been California; it was proper to try all the claims in one action because they arose out of the same nucleus of facts.1195 Statutes and Regulations D. Applicability of the Carriage of Goods by Sea Act and the Harter Act When shipments originate overseas under a single through bill of lading, or the shipper and carrier contract to limit the liability of intermediary carriers and freight forwarders, the Carmack Amendment may not apply. In the former instance, provisions on choice of law and limits of liability that are included in the contract will govern; in the latter instance only the initial carrier will be liable under the applicable law. When the initial carrier is an ocean carrier, COGSA1196 or the Harter Act1197 will apply. COGSA is the United Statesâ statutory enactment and implementation of the International 1192 Id. at 787. 1193 Id. 1194 Id. (citation omitted). 1195 Id. at 791. 1196 28 U.S.C. § 1300, et seq. (2014). 1197 46 U.S.C. § 30701, et seq. (2014).
249 Convention for the Unification of Certain Rules of Law Relating to Bills of Lading (also known as the Hague Rules). COGSA provides that â[e]very bill of lading or similar document of title which is evidence of a contract for the carriage of goods by sea to or from ports of the United States, in foreign trade, shall have effect subject to the provisions of this chapterâ1198 and specifies the responsibilities and liabilities of common carriers for damage to or loss of cargo.1199 The convention has at least eighty contracting parties, including the United States. Although both COGSA and the Convention may apply to an international shipment, a few minor differences exist between the two laws. When a conflict occurs between COGSA and the Convention, COGSA prevails.1200 The Harter Act governs the liability of water carriers and provides that â[a] carrier may not insert in a bill of lading or shipping document a provision avoiding its liability for loss or damage arising from negligence or fault in loading, stowage, custody, care, or proper delivery. Any such provision is void.â1201 The Harter Act applies to contracts of carriage of goods by sea between United States ports and between United States and foreign ports, whereas COGSA specifically applies to contracts between United States ports and foreign ports.1202 1198 28 U.S.C. § 1300 (2014). 1199 28 U.S.C. § 1303 (2014). 1200 Michael F. Sturley, âThe History of COGSA and the Hague Rules,â 22 J. Mar. L. & Com. 1, 55 (1991). 1201 Id. 1202 Gerard J. Mangone, United States Admiralty Law 85 (1997).
250 Cases E. Carmack Amendment Inapplicable When the Parties Contract Otherwise When parties engaged in maritime commerce enter into a contract and select COGSA to govern any dispute, the Carmack Amendment will not apply to the rail segment of an international shipment.1203 In Kawasaki Kisen Kaisha Ltd. v. Regal-Beloit Corp.1204 a shipping company issued the cargo owners in China four through bills of lading for multimodal transportation of their goods, including an inland rail segment that was subcontracted to Union Pacific. The bills of lading permitted the shipping company to extend the billâs limitations on liability and defenses to a subcontractor and to make COGSA applicable to the transportation of the goods until their delivery.1205 After a train derailment in Oklahoma destroyed their cargo, the owners brought an action against the railroad and the shipping company that issued the bills of lading.1206 The issue was whether the Carmack Amendment applied to the inland rail segment of a shipment originating overseas under a single through bill of lading.1207 The Supreme Court emphasized that parties engaged in international maritime commerce have the freedom to structure their contracts. The Court held that the Carmack Amendment, which is âtextually and historically limited to the carriage of goods received for domestic rail transport,â did not apply in this situation.1208 The Court held that the agreement that provided 1203 Kawasaki Kisen Kaisha Ltd. v. Regal-Beloit Corp., 130 S. Ct. 2433, 177 L. Ed.2d 444 (2010). 1204 Id., 130 S. Ct. at 2439, 177 L. Ed.2d at 433-434 (2010). 1205 Id., 130 S. Ct. at 2439, 177 L. Ed.2d 424. 1206 Id. 1207 Id., 130 S. Ct. at 2440, 177 L. Ed.2d at 434. 1208 Id., 130 S. Ct. at 2449, 177 L. Ed.2d at 444.
251 that Kawasaki and Regal-Beloit would litigate any dispute in Tokyo and that further provided that COGSA would apply to the entire journey prevented the Carmack Amendmentâs application to the rail transportation segment of the international shipment.1209 Furthermore, allowing a shipment to be governed both by the Carmack Amendment and by COGSA would undermine COGSA. The Carmack Amendment only applies to property for which a receiving rail carrier has issued a bill of lading.1210 When an international shipment is governed by a through bill of lading, there is no receiving rail carrier because the initial carrier did not receive the cargo for transport by domestic rail.1211 Furthermore, applying the Carmack Amendment to international shipments governed by a through bill of lading would create jurisdictional issues: the Carmack Amendment provides for venue within the United States; however, a through bill of lading may call for jurisdiction of claims outside the United States.1212 Before the Supreme Courtâs decision, the Ninth Circuit had ruled that a forum selection clause did not apply because the Carmack Amendment governs an international shipmentâs inland segment under a through bill of lading.1213 The Second Circuit had taken a similar position, whereas the Fourth, Sixth, Seventh, and Eleventh Circuits had decided that the 1209 Id. 1210 Id., 130 S. Ct. at 2445, 177 L. Ed.2d at 440. 1211 Id., 130 S. Ct. at 2444-2445, 177 L. Ed.2d at 439. 1212 Id., 130 S. Ct. at 2445-2447, 177 L. Ed.2d at 439-441. 1213 Id., 130 S. Ct. at 2440, 177 L. Ed.2d at 434.
252 Carmack Amendment did not apply in this situation.1214 The Supreme Courtâs decision therefore resolved a split among the circuits. F. International Shipment on a Through Bill of Lading when a Freight Forwarder Contracted for the Inland Portion The Carmack Amendmentâs applicability also is limited when a shipment originated overseas under a single through bill of lading that covers the inland segment of the transportation.1215 In Norfolk Southern Railway Co. v. Sun Chemical Corp.1216 Sun Chemical Corporation (Sun Chemical) hired an ocean carrier to ship products from Kentucky to Brazil.1217 The through bill of lading granted the ocean carrier the authority to enter into a contract with a freight forwarding company to coordinate the transportation; the freight forwarder thereafter contracted with Norfolk Southern to move the products from Kentucky to Savannah where they would be shipped to Brazil.1218 En route to Savannah, the train derailed, destroying the products.1219 After the lower court granted a summary judgment for Sun Chemical on the claims of negligence and breach of contract, the Georgia Court of Appeals reversed. The appeals court held that the Carmack Amendment did not apply to Norfolk Southern.1220 First, the bill of lading was a contract governed by federal maritime law, not by the 1214 Id. 1215 Norfolk Southern Railway Co. v. Sun Chemical Corp., 735 S.E.2d 19 (Ga. Ct. App. 2012), cert. denied, 2013 Ga. LEXIS 403 (Ga., Apr. 29, 2013). 1216 Id. at 22. 1217 Id. at 21. 1218 Id. at 21-22. 1219 Id. 1220 Id. at 28-29.
253 Carmack Amendment.1221 Second, the ocean carrier, not Norfolk Southern, was the âreceiving carrierâ of the products; thus, Norfolk Southern was not liable under Carmack.1222 Because of the Supreme Courtâs decision in Kawasaki, supra, part V.H.1, the Georgia court held that the application of the Carmack Amendment has been âsignificantly limitedâ in that the Carmack Amendment does not apply when ââproperty is received at an overseas location under a through bill [of lading] that covers the transport into an inland location in the United States.ââ1223 The Carmack Amendment only applies to the âinitial receiver,â which was the ocean carrier, and the freight forwarder and receiving rail carrier could contract out of the Carmack Amendment in subsequent agreements.1224 Because the freight forwarder contracted with Norfolk Southern regarding its own liability, the Carmack Amendment did not apply.1225 G. Effect of Covenants not to sue in a Through Bill of Lading on a Subcontractor The presence of a covenant not to sue in a through bill of lading prohibits a suit against a subcontractor. In Federal Insurance Company v. Union Pacific R. Co.1226 the Ninth Circuit had to determine whether Union Pacific, as a subcontractor of an ocean carrier, was liable to the 1221 Id. at 28 (stating that âwe construe the bill of lading issued by the ocean carrier which is before us, including its land components, as a âmaritime contractâ governed by federal law ⦠because [its] primary objective is to accomplish the transportation of goods by seaâ from a foreign country to the United States and stating that âCarmack does not apply to âwhat are essentially maritime contractsâ¦.ââ). See id. at 28- 29. 1222 Id. at 28. 1223 Id. at 22 (citation omitted). 1224 Id. at 25. 1225 Id. at 28. 1226 651 F.3d 1175, 1177 (9th Cir. 2011).
254 Federal Insurance Company (FIC) for the destruction of property that Union Pacific was transporting when one of its trains derailed. The FIC had insured the goods that were being transported by an ocean carrier for a shipper. The ocean carrier subcontracted with Union Pacific to make the inland delivery of the goods. The appeals court held that a covenant not to sue in the through bill of lading between the shipper and the ocean carrier prohibited FIC from suing Union Pacific because the railroad was merely a subcontractor.1227 Both the Hague Rules and COGSA allow a carrier to accept liability for the negligence of its subcontractor. Thus, under the courtâs decision, if a rail carrier is a subcontractor and its train derails, the railroad is not liable for the damaged goods if the shipper covenanted not to sue anyone other than the ocean carrier. The court also held that parties can opt out of the Harter Act, which generally covers goods before delivery and after discharge from a vessel, by extending the coverage of the COGSA or the Hague Rules by contract to cover the same period.1228 Articles H. Recent Criticism of Laws Limiting Railroad Liability Several articles have discussed the overlap of the Carmack Amendment and COGSA and the courtsâ conflicting interpretations of the Carmack Amendment. The articles stress the need for uniform laws on railroad liability to protect the integrity of foreign trade and to reduce shipping costs. 1227 Id. at 1180. 1228 Id. at 1179.
255 1. Need for a Uniform Law A law review article published prior to Kawasaki, supra, part V.H.1, discusses the legislative history of the Carmack Amendment and some of the conflicting decisions on the Carmack Amendmentâs applicability to the inland segment of a shipment by intermodal transportation that originates overseas.1229 As discussed in the article, the Ninth Circuitâs view was that âthe language of [the Amendment] also encompasses the inland leg of an overseas shipment conducted under a single âthroughâ bill of lading.â1230 The Second Circuit, however, held that the Carmack Amendment only covers rail and motor carriers and that the arranging of transportation by rail under a through bill of lading is not the same as providing transportation by a rail carrier.1231 The author argues that there is a need to âprovide the maximum degree of uniformityâ of the law on international maritime trade and cautions that deviating from the principle of uniformity will âincrease the expense of U.S. foreign trade.â1232 The article argues that the Carmack Amendment should apply to the inland segment of intermodal transportation, because the law on liability will not be uniform or predictable âif the law ⦠change[s] with the geographical location of the cargo or with the mode of transportation.â1233 2. Whether the Carmack Amendment Applies to Intermodal Exports Another law review article argues that the Kawasaki case was wrongly decided, that the decision âwill have a dramatic impact in the shipping industry,â and that the decision will affect 1229 William P. Byrne, âLoss and Damage Freight Claims,â 36 Transp. L. J. 145 (2009). 1230 Id. at 164-165 (citation omitted). 1231 Id. at 162-163. 1232 Id. at 174. 1233 Id.
256 imports and exports.1234 The article argues that an exemption under the Carmack Amendment of the inland segment of an overseas shipment eliminates the Amendmentâs application to a substantial amount of trade, because â[r]oughly 60% of all U.S. intermodal carriage involves international shipments.â1235 In addition, the article argues that the Kawasaki Court irrationally applied the Amendment to imports but not to exports.1236 The author argues that there is no textual or practical support for the Courtâs decision to âleave for another day the issue of Carmackâs application to intermodal exports.â1237 3. Alternative Reasoning for the Kawasaki Decision Another article criticizes the Kawasaki decision but argues that the Supreme Court should have used different reasoning to reach the same conclusion.1238 The author states that the Supreme Court misinterpreted the plain language of COGSA and the Carmack Amendment.1239 The author explains: A Clause Paramount in the bill of lading extends COGSA with the force of contract beyond the points of loading and discharge, that is, from the initial receipt of shipment until final delivery. This Clause Paramount should not bear on the Carmack Amendmentâs applicability because COGSA is not supposed to interfere with other federal statutes. Meanwhile, the Carmack Amendment should apply to the first rail carrier upon its receipt of goods inside the United States from the ocean carrierâ¦. Moreover, because COGSA 1234 Patrick M. Talbot, âHow Swiftly the Carmack Amendment is Washed Away,â 42 J. Mar. L. & Com. 631, 633-34 (2011). 1235 Id. at 633, 634. 1236 Id. at 664. 1237 Id. at 633-634. 1238 O. Shane Balloun, âThe Derailment of a Transport Statute: How Regal-Beloit Shipwrecked the Carmack Amendment on the Shoals of the COGSA,â 37 Tul. Mar. L. J. 379 (2013). 1239 Id. at 380.
257 and the Carmack Amendment contemplate specialized service contracts, both the ocean carrier and rail carrier would be able to enter into contracts with one another that subject the rail carrier to COGSA liability rather than Carmack Amendment liability. The carriers would be able to choose to avoid Carmack Amendment liability on the through bill of lading under the principle of the freedom of contract, but both statutes would remain in effect as default regimes.1240 The article discusses whether the Supreme Courtâs decision also will apply to exports and notes that some lower court decisions after Kawasaki have stated that the Carmack Amendment applies to export shipments on through bills of lading.1241 4. Judicial Split on Applicability of Carmack or COGSA to International Shipments An article in the Transportation Law Journal analyzes and harmonizes the decisions that were part of the split among the federal circuit courts of appeal on whether the Carmack Amendment or COGSA applies to the transportation by rail of cargo that was initiated overseas.1242 The article, which does not mention Kawasaki, appears to have been published just prior to the Supreme Courtâs decision in Kawasaki. In 2003, the Supreme Court held in Norfolk Southern Railroad Co. v. Kirby1243 that subcontractors may rely on the protection of a Himalaya Clause, referring to a clause in a bill of lading that âseeks to extend to non-carriers partial immunity or other protections afforded to the carrier by the bill of lading,â1244 even though the subcontractor is not a party to an agreement 1240 Id. at 393-394. 1241 Id. at 394 (citations omitted). 1242 Matthew K. Bell, âForget what you Intended: Surprisingly Strict Liability and COGSA Versus Carmack,â 37 Transp. L. J. 57, 58 (2010), hereinafter referred to as âBell.â 1243 543 U.S. 14, 125 S. Ct. 385, 160 L. Ed.2d 283 (2004). 1244 Bell, supra note 1242, at 58.
258 between the carrier and the shipper.1245 The Court, however, did not address the issue of whether COGSA or the Carmack Amendment governed the liability of a carrier for the inland transportation segment of an international shipment, thus creating an opportunity for the courts of appeal to choose which act would govern.1246 Four federal circuit courts of appeals held that the Carmack Amendment did not govern the domestic portion of an international shipment when a bill of lading extended COGSA to cover the domestic portion of a shipment,1247 whereas two federal circuits ruled that the Amendment covered the inland portion of an international shipment even when a bill of lading attempted to extend COGSAâs application.1248 The article argues that the Carmack Amendment should not apply âfor the following reasons: Carmackâs own language must be given effect; Supreme Court precedent requires it; judicial economy and economic certainty demand a bright-line rule; and the Kirby decision.â1249 The article argues that the Carmack Amendment does not govern the inland portion of an international shipment because a separate bill of lading is not issued for the inland portion.1250 However, the Supreme Court held in Reider v. Thompson1251 that the Carmack Amendment did 1245 Id. at 63. 1246 Id. 1247 Id. at 64-65. 1248 Id. at 65-66. 1249 Id. at 67-70. 1250 Id. at 68. 1251 338 U.S. 113, 70 S. Ct. 499, 94 L. Ed. 698 (1950).
259 apply to the inland portion of an international shipment because a domestic bill of lading was issued.1252 The article contends that applying the Carmack Amendment to inland segments of international shipments subject to a through bill of lading would âincrease litigation and create uncertainty through conflict between contractual terms and domestic laws. It would also require judicial determination as to the exact point in time when the ocean carrier and the inland carrier exchange the risk of loss for the goods.â1253 The article notes that in Kirby the Supreme Court held that âCarmack should not apply to inland segments of multimodal shipments subject to a through bill of lading, with COGSA applying to the other segments of the shipment, because this would destroy uniformity in maritime law.â1254 The article concludes that the courts should respect the partiesâ intent to the extent that they contract to extend COGSA to inland transportation.1255 1252 Bell, supra note 1242, at 68-69. 1253 Id. 1254 Id. at 70. 1255 Id. at 71.
260 VI. CHANGE IN DRAINAGE A. Introduction Railroads are required by state statutes and case law to construct culverts and ditches that provide adequate drainage to ensure that water flows in its natural course and is unobstructed. Section B summarizes a Missouri statute that obligates railroads to divert water to prevent damage neighboring properties. Sections C through E discuss federal law that requires railroads to facilitate water flow from the roadbed, whether the Federal Railroad Safety Act preempts claims under state law for water damage caused by negligence, and whether the Interstate Commerce Commission Termination Act (ICCTA) preempts state claims for water damage allegedly caused by a railroadâs actions. Section F addresses whether a change in topography resulting in changes in drainage modifies a railroadâs duty to provide proper drainage. Section G discusses an article that analyzes the principal rules of riparian rights that apply to landowners adjacent to a watercourse, including the rule of reasonable use adopted in many states. Statutes B. Duty of a Railroad to Construct and Maintain Ditches and Drains Missouri state law regulates a railroadâs obligation to provide outlets for water so that the water may follow its natural path and not damage adjacent property. It shall be the duty of every corporation or person owning or operating any railroad or branch thereof in this state, and of any corporation or person constructing any railroad in this state, within three months after the completion of the same through any county in this state, to cause to be constructed and maintained suitable openings across and through the right-of-way and roadbed of such railroad, and suitable ditches and drains along the roadbed of such railroad, to connect with ditches, drains and watercourses, so as to afford sufficient outlet to drain and carry off the water, including surface water, along such railroad whenever the draining of such water has been obstructed or rendered necessary by the construction of such railroad, except that such openings, ditches and drains
261 shall not be required to be reconstructed by the corporation to accommodate changes in land conditions not caused by the corporationâ¦.1256 C. Applicable Federal Law Requires Railroads to Facilitate Water Flow from the Roadbed Federal law requires that â[e]ach drainage or other water carrying facility under or immediately adjacent to the roadbed shall be maintained and kept free of obstruction[] to accommodate expected water flow for the area concerned.â1257 As held in Miller v. SEPTA, discussed below, the foregoing regulation preempted Pennsylvania law. Cases D. Whether the Federal Railroad Safety Act Preempts Claims under State Law for Water Damage Caused by Negligence 1. Decision by Pennsylvania Commonwealth Court In Miller v. SEPTA1258 the plaintiffs sued the Southeastern Pennsylvania Transportation Authority (SEPTA) for negligently causing water damage in 1996, 1999, and 2001 to a hotel, adjacent to the Sandy Run Creek, when a hurricane and two tropical storms flooded the hotelâs basement and first floors. The plaintiffs alleged that SEPTAâs negligent maintenance of a bridge impeded the flow of water to the creek, thus causing it to flood the hotel.1259 An expert witness for the plaintiffs concluded that âthe twin arches of the 1912 bridge acted as a âchoke pointâ that 1256 Mo. Rev. Stat. § 389.660 (2014). 1257 49 C.F.R. § 213.33 (2014). 1258 65 A.3d 1006 (Pa. Commw. Ct. 2013), reversed by, remanded, 103 A.3d 1225 (Pa. 2014). 1259 65 A.3d at 1008.
262 restricted the flow of the Sandy Run Creek and caused a backup of upstream watersâ that resulted in flooding where the hotel was located.1260 A Pennsylvania court held that the Federal Railroad Safety Act of 1970 (FRSA) preempted a state claim for negligence because the Secretary of Transportation had promulgated a regulation, discussed in part C above, that covered drainage issues. The court observed that â[s]ection 213.33 of the âTrack Safety Standardsâ regulation states [that] ⦠[e]ach drainage or other water carrying facility under or immediately adjacent to the roadbed shall be maintained and kept free of obstruction[] to accommodate expected water flow for the area concerned.â1261 Although the regulation refers only to roadbeds, the FRA had clarified that the regulation applied to bridges as well.1262 The savings clause in § 20106(a)(2)(A)-(C) of the FRSA could not prevent the preemption of the state claim.1263 The savings clause requires that to avoid preemption it must be shown that the state law â(A) is necessary to eliminate or reduce an essentially local safety or security hazard; (B) is not incompatible with a law, regulation, or order of the United States Government; and (C) does not unreasonably burden interstate commerce.â1264 The court, following the precedent set by the United States Supreme Court in CSX Transportation, Inc. v. Easterwood,1265 held that the FRSA preempted state claims for 1260 Id. 1261 Id. at 1012 (quoting 49 C.F.R. § 213.33). 1262 Id. at 1013. 1263 Id. at 1015. 1264 Id. at 1014 (quoting 49 U.S.C. § 206106(a)(2)(A)-(C)). 1265 507 U.S. 658, 113 S. Ct. 1732, 123 L. Ed.2d 387 (1993) (holding that the FRSA preempted state claims of negligence for operating a train at an excessive speed and for failing to maintain adequate warnings)).
263 negligence, because common law negligence does not address an essentially local safety hazard.1266 Thus, the plaintiffsâ claims failed to meet the required elements to avoid preemption.1267 Furthermore, the issue of water flow was an area completely occupied by federal law and to require railroads to comply with the common law of fifty states would burden interstate commerce.1268 Therefore, SEPTA was not liable for storm damage to the hotel. 2. Decision by the Supreme Court of Pennsylvania On October 30, 2014, in Miller v. SEPTA1269 the Supreme Court of Pennsylvania reversed and remanded the decision of the Commonwealth Court. The court held âthat the instant state law riparian rights claim is neither covered by the FRSAâs preemption provision, nor Section 213.33 of the federal Track Safety Standards regulations.â1270 The instant lawsuit does not pertain to any state railroad safety law, but pertains instead to riparian rights under Pennsylvaniaâs common law, a field which Pennsylvania has traditionally occupied, as other states have, vis-à -vis the riparian rights afforded therein. ⦠These principles of Pennsylvania common law have no direct or significant relation to railroad safety. Moreover, these riparian rights principles fall within the historic police powers of Pennsylvania, and are not to be superseded by a federal act unless superseding these common law principles is the clear and manifest purpose of Congress.1271 1266 Miller, 65 A.3d at 1014. 1267 Id. 1268 Id. at 1015. 1269 103 A.3d 1225 (Pa. 2014). 1270 Id. at *1236. 1271 Id. at *1237.
264 Furthermore, the court ruled that § 213.33 of the Track Safety Standards was not âdispositive of preemption as a regulation which covers the subject matter of the governing state lawâ¦.â1272 The court stated that § 213.33 âsimply does not address, much less cover, the subject matter of Pennsylvaniaâs common law riparian rights.â1273 E. Whether the Interstate Commerce Commission Termination Act of 1995 Preempts State Law Claims for Water Damage In Village of Big Lake v. BSNF Ry. Co.1274 the village brought an action against BSNF for raising the height of the track in and around the village that caused water damage to property within the village. The railroad bed created a barrier that artificially confined flood water and prevented it from receding.1275 The village alleged that the increased height violated a village ordinance, as well as a state statute on drainage.1276 The village sought a permanent injunction to require BNSF to lower its rail bed and to produce a hydrological and hydraulic study on the effect of the heightened rail bed on the villageâs flood plan as such studies were required by a local ordinance.1277 A Missouri appellate court held that the villageâs claims were preempted by the Interstate Commerce Commission Termination Act of 1995 (ICCTA), which âexpressly provides that the 1272 Id. at *1238. 1273 Id. 1274 382 S.W.3d 125 (Mo. App. 2012), remanded, by Village of Big Lake v. BNSF Ry. Co., 2014 Mo. App. LEXIS 634 (Mo. Ct. App., June 3, 2014). 1275 Village of Big Lake, 382 S.W.3d at 126-127. 1276 Id. at 126 (citing Mo. Rev. Stat. § 389.660 (2000). 1277 Id. at 127.
265 [STB] has exclusive jurisdiction over the âconstructionâ of railroad tracks.â1278 The courtâs reasoning was that the state statute and the local ordinance requiring a study were preempted per se by the ICCTA: [T]he STB has recognized two broad categories of state and local actions that are categorically preempted regardless of the context or rationale for the action: (1) âany form of state or local permitting or preclearance, that, by its nature, could be used to deny a railroad the ability to conduct some part of its operations or to proceed with activities that the [STB] has authorizedâ and (2) âstate or local regulation of matters directly regulated by the [STB] â such as the construction, operation or abandonment of rail lines....â1279 The appellate court determined that the applicable Missouri statute and local ordinances did not come within the exception to the preemption that requires that a state regulation must neither âdiscriminate against rail carriersâ nor âunreasonably burden rail carriage.â1280 However, after the Village of Big Lake appealed, the Court of Appeals of Missouri reversed and remanded the grant of a summary judgment in favor of BNSF and Massman Construction Co. The respondents argued that language in the permit agreements between Big Lake and BNSFâs predecessor, Burlington Northern, released Big Lakeâs claims for negligence and trespass relating to damage to Big Lakeâs underground water lines and a fire hydrant. The held that âgenuine issues of material fact [exist] as to which Respondents bear the burden of proof and persuasion,â thus âsummary judgment [was] precluded as a matter of law.â1281 1278 Id. at 129. 1279 Id. at 128-129 (citations omitted). 1280 Id. at 129 (citing Norfolk Southern Railroad Co. v. City of Alexandria, 608 F.3d 150, 160 (4th Cir. 2010) and CSX Transportation, Inc., 2005 STB LEXIS 657). 1281 Village of Big Lake v. BNSF Ry. Co., 433 S.W.3d 460, 461 (Mo. Ct. App., June 3, 2014).
266 F. Change in Topography Resulting in Changes in Drainage does not Modify a Railroadâs Duty to Provide Proper Drainage In City of Atlanta v. Kleber1282 the Supreme Court of Georgia held that Norfolk Southern and the city of Atlanta were not liable for damage to the plaintiffsâ property. Two homeowners brought actions for negligence and nuisance against Norfolk Southern and the city for water damage to their property that occurred during a period of heavy rainfall.1283 The homeowners argued that Norfolk Southernâs and cityâs failure to properly maintain a drainage pipe and culvert caused the damage.1284 The city was not liable for the damage because its mere approval of home construction in the neighborhood that may have contributed to an increase in flooding did not make it responsible for the maintenance of a railroad culvert.1285 As for Norfolk Southern, it was not liable for the damage because the culvert and drainage ditch that it installed were sufficient to drain water at the time they were installed in the 1970s, and Norfolk Southern had maintained them adequately since their installation. Norfolk Southern had committed no breach of duty to the plaintiffs, because it did not take âany subsequent action to increase the flow of water onto the homeownersâ property. Changes in the topography of the surrounding neighborhood not caused by Norfolk Southern did not create any new duty to change the parameters of the 1282 City of Atlanta v. Kleber, 285 Ga. 413, 419, 677 S.E.2d 134, 139 (Ga. 2009). 1283 Id., 285 Ga. at 413, 677 S.E.2d at 136. 1284 Id., 285 Ga. at 413, 677 S.E.2d at 135. 1285 Id., 285 Ga. at 419, 677 S.E.2d at 139. See also, Hardin County Drainage Dist. 55, Div. 3 v. Union Pac. R.R. Co., 826 N.W.2d 507 (Iowa 2013) (holding that Union Pacific was not obligated to pay for repairs or improvements to subterranean drainage tile because under Iowa law railroads are responsible for the upkeep of culverts but not of drainage tile); Louisville & N. R. Co. v. Bush, 336 S.W.2d 578 (Ky. 1960) (holding that the railroad was not liable for the increased water flow onto the plaintiffâs land because the railroad âdid not change the natural course of the water, nor did it cause the water to collect and be cast upon the lower estate in an unnatural volume or in an unusual or swift streamâ).
267 properly-installed drainage ditch and pipe.â1286 The homeownersâ separate nuisance claim was held to be barred by the statute of limitations.1287 Article G. Surface Water Rules in Arkansas A law review article discusses the issue of diffused surface water in Arkansas and analyzes several court cases, including some against railroads. Arkansas follows a rule of riparian rights under which landowners adjacent to a watercourse have the right to benefit from the water. The courts decide whether water is in a watercourse or is diffused surface water.1288 The article discusses the first railroad case in Arkansas involving liability for water damage. In 1882, in Little Rock and Fort Smith Railway Co. v. Chapman1289 the railroad had constructed an embankment that caused water to collect on the plaintiffâs property.1290 The court adopted a âmodified common enemy ruleâ for the state. Under the common enemy rule âa property owner may take whatever steps [are] necessary to protect againstâ diffused surface water.1291 The modified common enemy rule imposes liability on a homeowner who acts negligently in protecting himself from diffused surface water by unnecessarily harming a 1286 Kleber, 285 Ga. at 418, 677 S.E.2d at 138. 1287 Id. 1288 J. W. Looney, âDiffused Surface Water in Arkansas: Is it Time for a New Rule?â 18 U. Ark. Little Rock L.J. 393, 394 (1996), hereinafter referred to as âLooney.â 1289 39 Ark. 463, 1882 Ark. LEXIS 181 (1882). 1290 Looney, supra note 1288, at 408. 1291 Id. at 404.
268 neighboring property.1292 The court held that the railroad was liable for water damage because it constructed its roadbed without sufficient drains that caused unnecessary damage to the plaintiffâs land, thereby violating the modified common enemy rule.1293 Because the railroad could have protected its property from water damage without damaging the plaintiffâs property, the railroad was negligent when it acted to protect itself from diffused surface water.1294 The article argues that Arkansas should adopt a âreasonable use rule.â Under the reasonable use rule âliability is determined by the reasonableness of the property ownerâs actions [that] altered the surface water flow.â1295 Recently, many states have adopted the reasonable use rule because the common enemy rule historically was not intended to apply to surface water.1296 Under the reasonable use rule a property owner may be liable for interfering with the flow of water in a watercourse or for negligence in controlling, diverting, or otherwise handling diffused surface water.1297 1292 Id. at 405. 1293 Id. at 408. 1294 Id. 1295 Id. at 406-407. 1296 Id. at 415. 1297 Id. See also, J.M. Kelley, âBurlington Northern, et al. v. Benson County âThe North Dakota Supreme Court Dammed Water District from Extending Reasonable Use to Diffused Surface Waters in Natural Drainways,â 6 Great Plains Nat. Resources J. 162 (2002).
269 VII. CHANGE OF GRADE A. Introduction This part of the Report discusses whether damages are recoverable for grade changes usually at highway-railway crossings. As discussed in Sections B and C, municipalities are authorized to change the grade of streets; however, in many states railroads are also granted the same authority because of their status as public-service corporations. Property owners having a claim because of a change of grade will rely on their stateâs constitution as a basis for relief or possibly a state statute that provides for the recovery of damages from either a municipality or the railroad. A railroad company may be liable when a change of grade is for a railroad purpose rather than for a public use. Section D discusses liability when a change of grade was for a public use but the railroad contractually agreed with a municipality to be responsible for damages. Section E reviews a law review article that traces the development of amendments to state constitutions so as to permit the recovery of just compensation when a landownerâs abutting property either is taken or damaged because of a change of grade. Section F addresses liability to private land owners when access to their property is altered or obstructed by a change of grade. Statutes B. Recovery of Damages because of a Change of Grade In Wisconsin, a property owner is entitled to â[d]amages to property abutting on a highway right-of-way due to change of grade where accompanied by a taking of land.â1298 In New York the Transportation Law provides in part that: 1298 Wis. Stat. § 32.09(6)(f) (2014).
270 If the work of any grade crossing elimination project shall cause actual damage to property not acquired as provided in this article, the state shall be liable therefor, but this provision shall not be deemed to create any liability not already existing by statute. ⦠If the amount of any such claim is not agreed upon, such claim may, pursuant to the provisions of the eminent domain procedure law, be presented to the court of claims which shall hear such claim and determine if the amount of such claim or any part thereof is a legal claim against the state and, if it so determines, to make an award and enter judgment thereon against the stateâ¦.1299 In Pennsylvania, â[a]ll condemnors, including the Commonwealth, shall be liable for damages to property abutting the area of an improvement resulting from [a] change of grade of a road or highway, permanent interference with access or injury to surface support, whether or not any property is taken.â1300 Cases C. Liability of Railroads for a Taking or Damaging of an Ownerâs Property Caused by a Change of Grade In 1915 in Bennett v. Winston-Salem South-Bound Ry. Co.1301 the North Carolina Supreme Court held that unless the work was performed negligently a property owner may not recover for damage to his property caused by a change of grade that was authorized by the state or a political subdivision thereof.1302 The court held that property owners are not entitled to compensation when a state authorizes a change of grade to a highway. No compensation is due because the change of grade was made for a public purpose, and the compensation paid to the landowner when the property was taken initially for a highway precludes additional 1299 N.Y. Trans. Law § 228 (12) (2014) (emphasis supplied). 1300 26 Pa. Cons. Stat. § 714 (2014) (emphasis supplied). 1301 170 N.C. 389, 391, 87 S.E. 133, 134 (N.C. 1915). 1302 See Marchi v. Brackman, 130 Mont. 228, 299 P.2d 761 (1956) (holding that a city cannot transfer to another entity the power and authority used by the city for a public purpose).
271 compensation for later improvements to the highway.1303 The current edition of Nichols on Eminent Domain confirms the point. The treatise states that âwhen public highways are established, the government generally acquires a fee or easement interest that also includes the right to initially establish the grade of the roadway and to alter it at any time, and from time to time, as public necessity and convenience may require.â1304 Although railroads are private companies, they are considered to be public-service corporations. Consequently, they are endowed with statutory authority to condemn land for their use.1305 However, railroad companies do not have a continuing power or authorization to change or improve the grade without paying compensation. Although a railroad has the right to condemn land, the land is being taken for a private purpose, that is, for the railroad, not for a public purpose.1306 Therefore, a railroad must compensate a landowner for the diminished value of the property caused by a change of grade and for any damage caused by negligence in performing the work.1307 In Bennett, the taking was solely for a railroad purpose because it helped the railroad âbetter control its track and appurtenances, and facilitate the movement of its trains over it.â1308 1303 Bennett., 170 N.C. at 392, 87 S.E. at 135. 1304 2A-6 Nichols on Eminent Domain § 6.02[10]. 1305 Bennett, 170 N.C. at 392-393, 87 S.E. at 136. 1306 Although the question is beyond the scope of this Report, according to Nichols on Eminent Domain, there is no âprecise and fixed meaningâ of public use in the context of the power of eminent domain. 2A- 7 Nichols on Eminent Domain § 7.02[1]. 1307 Bennett, 170 N.C. at 393, 87 S.E. at 135. 1308 Id., 170 N.C. at 393, 87 S.E. at 136.
272 D. Contracts between States or their Local Governments and Railroads for Damages Caused by a Change of Grade Rigney v. New York Cent. & H. R. R. Co.1309 illustrates that a railroad under some circumstances may be held liable for damage to private property that occurred because of a change of grade that was for a public purpose. The court held that when a railroad and a municipality agree that the railroad will be liable for damage to property caused by a change of grade, the property owner may sue the railroad rather than the municipality for damages.1310 In Rigney, because a bridge above railroad tracks was unsafe and needed repair, the city of Rensselaer requested the railroad company that was changing the grade of the street to repair the bridge.1311 The contract between the railroad and the municipality stated that the railroad company expressly covenants and agrees that in the event of any damage resulting from the âworkâ as it progresses, or thereafter, as a result or in consequence thereof, or from any matter or thing connected therewith, arising therefrom, to any person or property, including damage resulting from change of grade of street, being approaches to said bridge, it will pay and liquidate the same at its own expense and assume the liability thereforâ¦.1312 The court held that because the railroad agreed to assume liability for damages the provision was more than a covenant by the railroad to indemnify the city.1313 To recover under the provision, however, a property owner had to meet two requirements as set forth in Lawrence 1309 217 N.Y. 31, 37, 111 N.E. 226, 228 (1916). 1310 Id. 1311 Id., 217 N.Y. at 34, 111 N.E. at 227. 1312 Id., 217 N.Y. at 35, 111 N.E. at 227. 1313 Id., 217 N.Y. at 37, 111 N.E. at 228.
273 v. Fox:1314 the municipality must have intended to secure a public benefit for owners of land affected by a change of grade, and the municipality must have had an obligation to the landowners.1315 In Rigney, the property ownerâs action met both requirements. Articles E. History of Liability for Taking or Damage to Property An article in the Vanderbilt Law Review traces the liability under state constitutions for government takings of property.1316 In the 1800s, property owners seeking compensation for actions interfering with their property rights relied on the common law. However, after 1890 many state courts held that âjust compensation provisions were themselves the source of property ownerâs rights of action for damages.â1317 By 1912, over half of the then forty-eight states had adopted a constitutional amendment requiring the payment of just compensation when property was taken or damaged rather than just taken.1318 The article discusses the courtsâ different approaches to compensation for a taking or damaging of property.1319 The article observes that because landowners could be awarded just compensation for a change of grade the 1314 Id. (citing Lawrence v. Fox, 20 N.Y. 268 (1859)). 1315 Id., 217 N.Y. at 37-38, 111 N.E. at 228. 1316 Robert Brauneis, âThe First Constitutional Tort: The Remedial Revolution in Nineteenth-Century State Just Compensation Law, 52 Vand. L. Rev. 57 (1999). 1317 Id. at 109. 1318 Id. at 115 (e.g., Alabama, Arizona, Arkansas, California, Colorado, Georgia, Illinois, Kentucky, Louisiana, Minnesota, Mississippi, Missouri, Montana, Nebraska, New Mexico, North Dakota, Oklahoma, Pennsylvania, South Dakota, Texas, Utah, Virginia, Washington, West Virginia, and Wyoming). 1319 Id. at 120-133.
274 courts were unlikely to grant property owners injunctive relief to prevent a change of grade.1320 The author concludes by discussing the issues of governmental immunity to actions for just compensation and whether injunctive relief is available under certain limited circumstances. F. Liability for a Change in a Landownerâs Access to Property Caused by a Change of Grade A recent law review article discusses government regulation of access to roads and highways.1321 In a 1906 landmark case, Sauer v. City of New York,1322 the United States Supreme Court held that a property owner was not entitled to compensation for loss of access to the street in front of his building because the city, not a railroad company, constructed the viaduct that obstructed his access.1323 The Court observed that the city constructed the viaduct for public purposes and that railroads were not permitted to use it.1324 Stokes discusses cases since Sauer and the amendment of state constitutions to provide for the payment of just compensation for either a taking or damaging of property and reviews current law on loss of access.1325 The article suggests that only when access to their land is obstructed do property owners have a claim for just compensation.1326 1320 Id. at 133. 1321 Michael L. Stokes, âAccess Management: Balancing Public and Private Rights in the Modern âCommonsâ of the Roadway,â 60 Clev. St. L. Rev. 585, 590 (2012), hereinafter referred to as âStokes.â 1322 Sauer v. City of New York, 206 U.S. 536, 27 S. Ct. 686, 51 L. Ed. 1176 (1907); Stokes, supra note 1308, at 599. See also, Elizabeth Arens, âNote: the Elevated Railroad Cases: Private Property and Mass Transit in Gilded Age New York,â 61 N.Y.U. Ann. Surv. Am. L. 629 (2006). 1323 Stokes, supra note 1321, at 601. 1324 Id. at 600. 1325 Id. at 601-602, 626-642.
275 On the subject of damages for loss of access, the Stokes article may be compared with Nichols on Eminent Domain. Nichols states that a landowner may be entitled to damages when government construction results in a loss of access to property.1327 Specifically, when there is a change of grade and a loss of access to abutting property, a property owner âis entitled to compensation under the âdamageâ provision of the Constitution.â 1328 However, when access to land is only partially obstructed, compensation is not warranted.1329 Finally â[a]n owner specially damaged by a change of grade is entitled to compensation without regard to whether the grade is changed by a public entity for the convenience of travelers or by [a] private corporation such as a railroad, street railway, or other public service corporation.â1330 A land owner is specially damaged when his injury is one not shared by the general public.1331 1326 Id. at 654. 1327 2A-6 Nichols on Eminent Domain §§ 6.02[1] and 6.02[9]. 1328 Id. at § 16.05[3] (emphasis supplied). 1329 Id. 1330 Id. 1331 Id.
276 VIII. CHICAGO REGION ENVIRONMENTAL AND TRANSPORTATION EFFICIENCY PROGRAM (CREATE) A. Introduction The Chicago Region Environmental and Transportation Efficiency Program (CREATE) is âa first-of-its-kind public/private partnershipâ among the state of Illinois, city of Chicago, American Association of Railroads (e.g., BNSF, Canadian National, CSX, and Norfolk Southern), National Railroad Passenger Corp (Amtrak), and the Commuter Rail Division of the RTA (Metra).1332 The total estimated cost for the CREATE partners is $3.2 billion.1333 CREATE is âthe first state-local-private partnership aimed at solving an infrastructure problemâ on such a large scale.1334 CREATE has twenty-one projects that will benefit Metra commuter service, for example, on five Metra routes by decreasing delays and making service more reliable by reducing âconflict pointsâ with freight trains.1335 Some funding has been committed, including $86 million provided by the Safe, Accountable, Flexible, Efficient Transportation Equity Act: A 1332 Chicago Region Environmental and Transportation Efficiency Program (CREATE), âWhat is CREATE?,â available at: http://www.aurora- il.org/documents/cnrailway/docs_meeting/Call%20to%20Action%20CREATE%20Exhibit.pdf (last accessed March 31, 2015). See also, Jeff Stagl, Transportation Improvement Program Posts Progress in Chicago, Maintenance of Way (July 2012) (describing the CREATE projects, importance, partners, and funding to improve railroad efficiency in Chicago), available at: http://www.progressiverailroading.com/mow/article/Transportation-improvement-program-posts- progress-in-Chicago-- (last accessed March 31, 2015). 1333 Jacki Murdock, University of California-Los Angeles, âEvolution and Financing of the Chicago Region Environmental and Transportation Efficiency Program,â at 16, available at: http://jackimurdock.files.wordpress.com/2013/03/create.pdf (last accessed March 31, 2015), hereinafter referred to as âEvolution and Financing of CREATE.â 1334 Mark Perlman and Julia Pulidindi, âPublic-Private Partnerships for Transportation Projects,â at 4 National League of Cities, Municipal Action Guide (May 2012). 1335 Chicago Region Environmental and Transportation Efficiency Program, Passenger Rail Benefits, available at: http://www.createprogram.org/factsheets/pass_benefits.pdf (last accessed March 31, 2015).
277 Legacy for Users (SAFETEA-LU) and $100 million by the United States Department of Transportation (DOT) in 2010 as part of the Transportation Investment Generating Economy Recovery program (TIGER), a discretionary program under the American Recovery and Reinvestment Act of 2009 (ARRA).1336 As of 2010, contributions toward the funding of CREATE also included $100 million from the railroads, $30 million from the city of Chicago, and $100 million from the state of Illinois.1337 As discussed in Section B, the National Environmental Policy Act (NEPA) applies to CREATE. Part C discusses funding made available under TIGER and the ARRA. Parts D and E, respectively, summarize a 2013 report that provides an overview of CREATEâs projects and funding and a recent article that reports that CREATE as of June 2013 had not secured the funding required to complete its projects. Statutes and Regulations B. National Environmental Policy Actâs Applicability to CREATE Under the National Environmental Policy Act or NEPA an agency must review a program for its potential environmental effects if the program is partially funded or directed by a federal agency.1338 The CREATE program is partially funded with federal money, and, therefore, must be reviewed by a federal agency.1339 1336 Evolution and Financing of CREATE, supra note 1333, at 18-19. 1337 Id. at 19. 1338 See 42 U.S.C. §§ 4332 and 4332(2)(C) (2014) (âmajor Federal actions significantly affecting the quality of the human environmentâ). 1339 CREATE: Final Feasibility Plan (2005), available at: http://www.createprogram.org/linked_files/final_feasibility_plan_orig.pdf (last accessed March 31, 2015).
278 C. TIGER Program under the American Recovery and Reinvestment Act The United States Department of Transportation (DOT) established the TIGER program through the American Recovery and Reinvestment Act (ARRA) for the purpose of awarding grants to improve infrastructure for transportation.1340 The program includes funding for passenger and freight rail transportation projects.1341 Grant money under the TIGER program cannot be less than $20 million or more than $300 million for any one project.1342 Articles D. Overview of CREATEâs Origin, Purpose, Projects, and Funding A 2013 report by the Infrastructure Council of the Illinois Chamber of Commerce provides an overview of CREATEâs origin, purpose, projects, and funding and describes the Chicago areaâs need for the CREATE program.1343 Chicago, the largest rail port in North America, is heavily congested by rail traffic.1344 CREATE is in response to the need for a cohesive plan to address the congestion in the Chicago area through seventy different projects.1345 Seventeen of the projects have been completed and eleven more are underway.1346 1340 Pub. L. No. 111-5, 123 Stat. 115, 516 (Feb. 19, 2009). See U.S. DOT, Tiger Discretionary Grants Enacted FY 2015 Appropriations Bill Includes $500 Million Tiger Program, available at: http://www.dot.gov/tiger (last accessed March 31, 2015). 1341 Pub. L. No. 111-5, 123 Stat. 115, 516 (Feb. 19, 2009). 1342 Id. 1343 Benjamin J. Brockschmidt, Infrastructure Council of the Illinois Chamber of Commerce, CREATE Ten Years: The Past, Present, and Future of the Chicago Regionâs Railroads (2013), available at: http://www.cmap.illinois.gov/documents/10180/125910/CREATE-Report-Final.pdf/382726e9-8c31- 4b58-ab8b-8ddb65dc72cf (last accessed March 31, 2015). 1344 Id. at 2. 1345 Id. at 2-3. 1346 Id. at 3.
279 The area already has attained a reduction in congestion because of the completion of some projects.1347 Reportedly, there has been a twenty-eight percent reduction in freight delays and a thirty-three percent reduction in passenger delays.1348 The report also discusses CREATEâs economic and environmental benefits and the anticipated increase in freight traffic in the coming years.1349 E. CREATEâs Future as Dependent on Additional Funding A June 2013 article in the Chicago Tribune discusses the possibility that funding for the CREATE program will diminish.1350 As of the date of the article, the CREATE program still needed $2 billion for the completion of its projects.1351 Partners in the program, including Amtrak, have testified before a House Subcommittee on Transportation on the CREATE projects that already have been completed successfully.1352 CREATE has yet to secure the funding needed to finish its projects.1353 1347 Id. at 5. 1348 Id. 1349 Id. at 5-9. 1350 Richard Wronski, âChicago Rail Program a Success, but Future Funding in Doubt, Officials Say,â Chicago Tribune (June 11, 2013), available at: http://articles.chicagotribune.com/2013-06-11/news/ct- met-railroad-bottlenecks-20130611_1_rail-crossings-create-program-englewood-flyover (last accessed March 31, 2015). 1351 Id. 1352 Id. 1353 Id.
280 IX. COMMON CARRIER OBLIGATION OF RAILROADS A. Introduction The common carrier obligation of railroads, now a statutory requirement, is codified at 49 U.S.C. § 11101. A railroad company is required to provide transportation to all parties upon reasonable request, including for hazardous materials. Exceptions to the common carrier obligation are not to be implied. Finally, rail carriers generally are insulated from tort claims under state law but a Clarification Amendment (49 U.S.C. § 20106(b)) has increased a rail carrierâs liability. Sections B and C discuss statutes, regulations, and policies that apply to a rail carrierâs common carrier obligation, services, and rates under § 11101, including a carrierâs obligation to accept and transport hazardous materials. As for relevant cases, as discussed in section D, exceptions to a railroad companyâs common carrier obligations are not to be implied. Section E illustrates more particularly the statutory obligation of a railroad company as a common carrier to transport hazardous materials. Finally, section F discusses a recent article on the preemption of tort claims under state law with respect to a railroad companyâs transportation of such materials. Statutes, Regulations, and Policies B. Common Carrier Transportation, Service, and Rates Under 49 U.S.C. § 11101(a) [a] rail carrier providing transportation or service subject to the jurisdiction of the Board under this part shall provide the transportation or service on reasonable request. A rail carrier shall not be found to have violated this section because it fulfills its reasonable commitments under contracts authorized under section 10709 of this title before responding to reasonable requests for service.1354 1354 49 U.S.C. § 11101(a) (2014).
281 Furthermore, the law provides that â[c]ommitments which deprive a carrier of its ability to respond to reasonable requests for common carrier service are not reasonable.â1355 C. Common Carrier Obligation of Railroads to Transport Hazardous Materials According to the STB and pursuant to § 11101 railroads have a common carrier obligation to transport hazardous materials, a service that must be provided on reasonable request by shippers. A shipper of hazardous materials has made a reasonable request for rail transportation when the shipper tenders its product to a rail carrier in a rail car meeting DOT packaging and mechanical requirements.1356 As stated by the Eighth Circuit, âa railroad may not refuse to provide services merely because to do so would be inconvenient or unprofitable.â1357 More recently, in a statement by the Department of Transportation (DOT), the DOT agreed with the STB that ârailroads have a common carrier obligation to transport hazardous materials and cannot refuse to provide this service merely because to do so would be in convenient or unprofitable.â1358 The DOT noted that the transportation of hazardous materials is currently very safe but that the DOT has made several initiatives to increase the safety of transporting such materials.1359 1355 Id. 1356 Surface Transportation Board Shippers Committee, OT-5 v. The Ann Arbor R.R., 5 ICC 856 (1989). 1357 G.S Roofing Prods. Co. v. Surface Transp. Bd., 143 F.3d 387, 391 (8th Cir. 1998). 1358 United States Department of Transportation, Common Carrier Obligation of Railroads â Transportation of Hazardous Materials, at 1 (July 22, 2008), available at: http://www.fra.dot.gov/eLib/Details/L02847 (last accessed March 31, 2015). 1359 Id. at 2.
282 As stated by the DOT, the transportation of hazardous materials is essential to our daily lives and therefore unavoidable.1360 Furthermore, railroads transport a majority of the shipments of hazardous materials that are toxic to inhale. Transportation of hazardous materials by highway would require a substantial investment to equal the capacity currently available by rail. A transfer of shipments of hazardous materials to motor carriers would increase fuel consumption and pollution, as well as increase the cost of the goods. Moreover, trucks are involved in more accidents than rail cars.1361 A pipeline is not feasible because a pipeline would require a substantial investment in infrastructure.1362 A pipeline also would require a substantial environmental investment. When there are accidents, the DOT and the Federal Railroad Administration (FRA) respond by implementing supplementary regulations to address any human factors that caused or contributed to an accident.1363 The DOT and FRA have promulgated regulations to improve the integrity of tank cars to reduce the possibility of spillage or leakage. Moreover, the DOTâs Pipeline and Hazardous Materials Safety Administration (PHMSA) has published rules (49 C.F.R. § 172.80, et seq.) that require bulk shippers and carriers of hazardous materials to develop safety plans to address âpersonnel security, unauthorized access, and en route security and ⦠possible transportation security risks,â as well as other risks already 1360 Id. 1361 Id. at 3-5 (noting the declining number of train accidents, deaths, and injuries). 1362 Id. at 4. 1363 Id. at 5-6.
283 identified.1364 The PMHSA has trained and equipped first responders in local communities to assist them in handling any rail incidents involving hazardous materials.1365 Cases D. Exceptions to the Common Carrier Obligation are not to be Implied In 1967, in Am. Trucking Assân v. Atchison, Topeka, & Santa Fe Ry. Co.1366 the Supreme Court heard three cases that challenged two rules promulgated by the Interstate Commerce Commission (ICC).1367 The Court considered whether the ICC had the âauthority to promulgate rules providing ⦠that railroads which offer trailer-on-flatcar (TOFC or âpiggybackâ) service to the public under open-tariff publications must make such service available on the same terms to motor and water common and contract carriersâ and whether âmotor and water carriers may, subject to certain conditions, utilize TOFC facilities in the performance of their authorized service.â1368 The Interstate Commerce Act provided that âit shall be the duty of common carriers by rail to provide transportation âupon reasonable request thereforâ and to establish just and reasonable rates.â1369 The Court held that the âobligation as common carriers is comprehensive and exceptions are not to be implied.â1370 Because a rail carrier is required to provide the same 1364 Id. at 10. 1365 Id. at 13-14. 1366 387 U.S. 397, 87 S. Ct. 1608, 18 L. Ed.2d 847 (1967). 1367 Id., 387 U.S. at 400, 87 S. Ct. at 1610. 1368 Id., 387 U.S. at 397, 400, 87 S. Ct. at 1610. 1369 Id., 387 U.S. at 406, 87 S. Ct. at 1614 (citation omitted). See 49 U.S.C. § 11101 (2014). 1370 Id., 387 U.S. at 407, 87 S. Ct. at 1614.
284 services to all parties the carrier may not discriminate against and refuse service to motor carriers or other competitors.1371 E. Statutory Common Carrier Obligation to Transport Hazardous Materials In Riffin v. Surface Transportation Board1372 Riffin and Strohmeyer filed an application with the STB to acquire and operate approximately 800 feet of privately-owned railroad track in New Jersey. The STB rejected their application because it ââexplicitly propose[d] to limit the goods to be shipped to non-Toxic Inhalation Hazard [âTIHâ] products.ââ1373 Strohmeyer argued that an applicant requesting to become a common carrier is not required to carry hazardous materials and has a common-law right to designate the goods it is willing to carry for hire.1374 However, the STB ruled that ârailroads have ⦠a statutory common carrier obligation to transport hazardous materials where the appropriate agencies have promulgated comprehensive safety regulations,â1375 noting that a railroadâs statutory obligation under § 11101 supersedes the common law.1376 Riffin petitioned the District of Columbia Circuit to review the Boardâs decision, advancing the same argument that Strohmeyer had made.1377 The court held that the Boardâs 1371 Id. 1372 733 F.3d 340 (D.C. Cir. 2013). 1373 Id. at 341 (citation omitted). 1374 Id. at 342 1375 Id. 1376 Id. at 343. 1377 Id.
285 interpretation of the statutory requirement in 49 U.S.C. § 11101 was permissible.1378 The common carrier obligation requires a rail carrier to provide transportation or service upon reasonable request and when an agency has promulgated comprehensive safety regulations for a particular type of cargo (helping to ensure the safety of shipments of that category of freight)[] those regulations can be viewed as transforming a shipping request into a presumptively reasonable one under § 11101.1379 The District of Columbia Circuit held that the Boardâs decision and reasoning were not arbitrary, capricious, or contrary to law1380 and stated that the only way for a rail carrier to avoid its common carrier obligation ââare abandonment, discontinuance, or embargo.ââ1381 The court denied the petition.1382 Article F. The Common Carrier Obligation and the Preemption of State Tort Law on the Transportation of Hazardous Materials As one article explains, the common carrier obligation that began as a common law doctrine was enforced in the 1887 Act to Regulate Commerce and later codified by the Hepburn Act of 1906.1383 The common carrier âobligation is premised on the public need to transport certain materials, even though considered dangerous or otherwise more trouble than worthwhile 1378 Id. at 346. 1379 Id. at 346-347. 1380 Id. 1381 Id. at 347 (citation omitted). 1382 Id. at 348. 1383 Aaron Ries, âRailroad Tort Liability After the âClarifying Amendment:â Are Railroads Still Protected by Preemption,â 77 Def. Couns. J. 92, 97 (2010), hereinafter referred to as âRies.â
286 for the carrier.â1384 The common carrier obligation mandates that railroads transport hazardous materials, toxic inhalation hazard (TIH) materials, nuclear materials, and other non-nuclear hazardous materials as long as there is a comprehensive regulatory framework that governs the transportation of the materials, such as 49 U.S.C. § 5101, et seq. (Transportation of Hazardous Materials) and 49 U.S.C. §20101, et seq. (Federal Railroad Safety Act).1385 Railroad companies have attempted to limit their liability when transporting hazardous materials through indemnification clauses; however, the companies have âlived under the shadow of strict liability in the event [that] such hazardous materials cause[] damage to life and property.â1386 The Federal Railroad Safety Act and the Hazardous Materials Safety Act preempt tort claims under state law.1387 Because later cases limited the ability of injured parties to secure relief Congress enacted a Clarifying Amendment (49 U.S.C. § 20106(b)) that provides that âa railroad may be liable if it fails to satisfy a standard of care placed on it by federal regulations.â1388 1384 Id. 1385 Id. at 100. 1386 Id. at 100-101. 1387 Id. at 102-103. 1388 Id. at 107.
287 X. COMPETITION AND RAILROADS A. Introduction As discussed in this part, railroad competition and mergers currently are regulated by the Surface Transportation Board (STB).1389 Section B discusses regulatory reform, deregulation, and mergers and acquisitions of railroads; the Regional Rail Reorganization Act of 1973; the Railroad Revitalization and Regulatory Reform Act of 1976; the Staggers Act of 1980; factors applicable to consolidations, mergers, and acquisitions of railroads; the role and authority of the Surface Transportation Board (STB); and competitive access.1390 Section C discusses the railroadsâ express or implied immunity from antitrust liability and the preemption of state antitrust laws by the Interstate Commerce Commission Act of 1995 (ICCTA).1391 The articles summarized in part C suggest how the antitrust exemptions and regulatory environment governing railroads could be modified. Section D discusses competitive access for railroads, the use of terminal facilities and reciprocal switching agreements, as well as a proceeding at the STB in which the Board considered whether to change the rules that regulate mandatory competitive switching arrangements. 1389 49 U.S. Code § 701, et seq. (2014). 1390 âCompetitive access generally refers to the ability of a shipper or a competitor railroad to use the facilities or services of an incumbent railroad to extend the reach of the services provided by the competitor railroad.â Petition For Rulemaking to Adopt Revised Competitive Switching Rules, Docket No. EP 711, 42264, 2012 STB LEXIS 273, at *5. 1391 Pub. L. 104-88 (Dec. 29, 1995), summary available at Govtrack.us: https://www.govtrack.us/congress/bills/104/hr2539/summary (last accessed March 31, 2015).
288 Statutes B. Regulatory Reform, Deregulation and Mergers and Acquisitions of Railroads 1. Regional Rail Reorganization Act of 1973 Because many railroad companies were facing bankruptcy in the early 1970s Congress enacted the Regional Rail Reorganization Act of 1973 (3R Act) for the reorganization of regional rail lines and to provide the lines with governmental assistance to make them more profitable.1392 The 3R Act also established the United States Railway Association (USRA) and the Consolidated Rail Corporation (Conrail).1393 The duties of the USRA were âto organize and finance the reorganization of bankrupt railroads in the Northeast and Midwestâ and to monitor the financial performance of Conrail.1394 Conrail was required to grant the USRA access to pertinent information that was necessary for the USRA to fulfill its obligations concerning Conrailâs financial performance.1395 The USRA was abolished in 1987 âafter CONRAIL gained financial independence.â1396 In 1997, the STB approved a joint stock purchase that permitted Norfolk Southern and CSX to acquire Conrail.1397 1392 45 U.S.C. § 701(a) (2014) (as amended in 1975, 1976, 1978). 1393 See 45 U.S.C. § 701(b)(3)-(4) (2014). 1394 United States Railway Association Studies and Reports, 1973-1987, available at: http://www.libraries.psu.edu/findingaids/1836.htm (last accessed March 31, 2015), hereinafter referred to as âUSRA Studies and Reports.â See also, 45 U.S.C. § 712(a)(1). 1395 See 45 U.S.C § 713 (2014). 1396 USRA Studies and Reports, supra note 1394. See also, 45 U.S.C. § 1341(a)(1)(1987). 1397 Conrail, A Brief History of Conrail, available at: http://www.conrail.com/history.htm (last accessed March 31, 2015). As explained by Conrail, the ârestructuring plan transformed Conrail into a switching and terminal railroad that operates on behalf of its owners, Norfolk Southern and CSX, in the Shared Assets Areas of Northern New Jersey, Southern New Jersey/Philadelphia, and Detroit.â Id.
289 Articles 2. The Railroad Revitalization and Regulatory Reform Act of 1976 A study of the effect of the Railroad Revitalization and Regulatory Reform Act of 1976 (4R Act)1398 published in the University of Chicagoâ Journal of Law & Economics in 2007 argues that the 4R Act, along with the Staggers Act of 1980, discussed below, âbrought sweeping changes for both rail rates and abandonments of freight service.â1399 The authors conclude, however, that average densities on U.S. railroads (in 2001) were more than 34 percent higher than they would have been under the presence of regulation. Furthermore, we estimate that the benefits (in enhanced operating efficiencies) from these increased densities were quite substantial, that is, an order of magnitude of $7- $10 billion per year as of 2001, or 10-22 percent of total operating costs, depending on the assumptions made for the configuration of a typical railroad.1400 The authors explain that their âmeasure of this density is net revenue ton-miles divided by route-miles.â1401 3. The Staggers Act of 1980 In an article entitled âThe Success of the Staggers Rail Act of 1980â the author contends that the Staggers Act1402 represented a âdramatic change in the evolution of the U.S. railroad industryâ and that as a result of the Act there was a consolidation in the industry that had 1398 See 45 U.S.C. § 801, et seq. (2014). 1399 John. D. Bitzan and Theodore E. Keeler, âEconomies of Density and Regulatory Change in the U.S. Railroad Freight Industry,â 50 J. Law & Econ. 157, 159 (2007). 1400 Id. at 175. 1401 Id. at 159 (footnote omitted). 1402 See 49 U.S. Code § 10101, et seq. (2014).
290 âbeneficial effects on shippers and railroadsâ alike.1403 The article states that railroads had to âreduce their costs to improve financial performanceâ but that deregulation allowed railroads to negotiate contract rates.1404 The author concludes that ârail deregulation accomplished its primary purpose of putting the U.S. rail industry on a more secure financial footing.â1405 Statutes 4. Factors Applicable to Consolidations, Mergers, and Acquisitions of Railroads As a result of the ICCTA, 49 U.S. Code § 11323(a) states that âtransactions involving rail carriers providing transportation subject to the jurisdiction of the Board under this part may be carried out only with the approval and authorization of the Board,â including, for example, the â[c]onsolidation or merger of the properties or franchises of at least 2 rail carriers into one corporation for the ownership, management, and operation of the previously separately owned propertiesâ and the â[a]cquisition of control of a rail carrier by any number of rail carriers.â1406 Thus, railroads may not merge, acquire control of another rail carrier, or acquire trackage rights over anotherâs railroad tracks without the STBâs approval.1407 Section 11324 sets forth the factors that the STB considers when approving a railroad merger:1408 1403 Clifford Winston, âThe Success of the Staggers Rail Act of 1980,â AEI-Brookings Joint Center for Regulatory Studies 1, 5 (Oct. 2005), available at: http://www.brookings.edu/research/papers/2005/10/railact-winston (last accessed March 31, 2015). 1404 Id. at 6. 1405 Id. at 8. 1406 49 U.S.C. § 11323 (a)(1) and (3) (2014) (enacted in 1995). 1407 49 U.S.C. § 11323(1) (2014).
291 (1) the effect of the proposed transaction on the adequacy of transportation to the public; (2) the effect on the public interest of including, or failing to include, other rail carriers in the area involved in the proposed transaction; (3) the total fixed charges that result from the proposed transaction; (4) the interest of rail carrier employees affected by the proposed transaction; and (5) whether the proposed transaction would have an adverse effect on competition among rail carriers in the affected region or in the national rail system.1409 Pursuant to 49 U.S.C. § 1132(c), â[t]he Board shall approve and authorize a transaction under this section when it finds the transaction is consistent with the public interestâ and âmay impose conditions governing the transaction, including the divestiture of parallel tracks or requiring the granting of trackage rights and access to other facilities.â1410 Transactions between minor railroads, that is, carriers that have an annual carrier operating revenue of less than $250 million,1411 must be approved unless âas a result of the transaction, there is likely to be [a] substantial lessening of competition, [the] creation of a monopoly, or [a] restraint of trade...; and the anticompetitive effects of the transaction outweigh the public interest in meeting significant transportation needs.â1412 5. Interstate Commerce Commission Termination Act of 1995 The ICCTA dissolved the ICC, created the STB, and transferred the ICCâs powers over the railway industry to the STB.1413 The ICCTA prescribes the number of members on the Board 1408 49 U.S.C. § 11324 (2014). 1409 49 U.S.C. § 11324(b)(1)-(5) (2014). 1410 49 U.S.C. § 11324(c) (2014). 1411 49 C.F.R. part 1201 (2014) (General Instructions, 1-1 (classification of carriers)). 1412 49 U.S.C. § 11324(d)(1)-(2) (2014). 1413 49 U.S.C. § 701(a)-(b)(4) (2014).
292 and their qualifications.1414 Under § 703 the STB has the status of a governmental agency.1415 The STB has authority to (1) inquire into and report on the management of the business of carriers providing transportation and services subject to subtitle IV; (2) inquire into and report on the management of the business of a person controlling, controlled by, or under common control with those carriers to the extent that the business of that person is related to the management of the business of that carrier; (3) obtain from those carriers and persons information the Board decides is necessary to carry out subtitle IV; and (4) when necessary to prevent irreparable harm, issue an appropriate order without regard to subchapter II of chapter 5 of title 5.1416 The STB also has the power to subpoena witnesses and take depositions.1417 Cases 6. Authority of the STB to Impose Environmental Conditions on Minor Mergers The District of Columbia Circuitâs ruling in Village of Barrington v. Surface Transportation Board1418 is an important interpretation of the STBâs discretion to set conditions when approving railroad mergers. In Barrington, the court held that the STB has the authority to impose environmental conditions when approving minor mergers.1419 Canadian National proposed to acquire the Elgin, Joliet and Eastern Railway Company to avoid rail traffic 1414 49 U.S.C. § 701(b)(1)-(2) (2014). See also, 49 U.S.C. § 702 (2014) (stating that the STB âshall perform all functions that, immediately before January 1, 1996, were functions of the Interstate Commerce Commissionâ¦.â). 1415 49 U.S.C. § 703(a)(b) (2014). 1416 49 U.S.C. § 721(b) (2014). 1417 49 U.S.C. § 721(c)(d) (2014). 1418 636 F.3d 650 (D.C. Cir. 2011). 1419 Id. at 651.
293 congestion in Chicago but needed the STBâs approval as required under 49 U.S.C. § 11323.1420 Subsection (d) requires approval of minor transactions unless anticompetitive effects are likely to occur, but subsection (c) permits the STB to impose conditions.1421 After reviewing the environmental impact statement, which disclosed concerns regarding traffic congestion, safety, spills of hazardous materials, and the impact on wildlife, the STB imposed two conditions that would cost Canadian National approximately $68 million.1422 The conditions required Canadian National to pay â67% of building a grade separation at Ogden Avenue, near Aurora, Illinois and 78.5% of the costs of building oneâ at another location in Illinois.1423 The court, which granted Chevron deference to the STBâs interpretation of its authority, held that the STB had the authority to impose the above conditions under subsection (d).1424 Under Chevron, the court must first determine whether the intent of Congress is clear from the statute.1425 If Congressâs intent is not clear, the court must determine whether the agencyâs interpretation is reasonable.1426 The court held that there was ânothing in section 11324 [that] unambiguously forecloses the Board from imposing environmental conditions on âminorâ 1420 Id. at 652-653. 1421 Id. at 654. 1422 Id. at 653-654. 1423 Id. at 654. 1424 Id. at 658-659 (citing Chevron, U.S.A., Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S. Ct. 2778, 81 L.Ed.2d 694 (1984)). 1425 Id. at 659. 1426 Id. at 660.
294 mergers.â1427 The court further held that because the STBâs interpretation of subsection (d) was reasonable the court had to give a high degree of deference to the agencyâs decision to impose environmental conditions.1428 7. Challenging a Railroadâs Rate caused by a Bottleneck In respect to railroads, because a bottlenecking carrier is ââa necessary participant in all available routes, ... it can usually control the overall rate sufficiently to preclude effective competition.ââ1429 In Burlington N. R. Co. v. Surface Transportation Board1430 the court held that the STB was correct in finding that the railroadâs rate was unreasonable and in lowering the rate the shipper was required to pay.1431 Burlington Northern transported coal from a mine in Wyoming to a station in Texas at the rate of $19.36 per ton of coal.1432 Petitioning the ICC, the STBâs predecessor, a shipper, the West Texas Utilities Company (WTU), alleged that the rate was unreasonably high.1433 Because Burlington Northern was a bottleneck carrier, the STB agreed with the shipper, set the new rate at $13.68 per ton of coal, and ordered Burlington Northern to pay the shipper the difference between the two charges.1434 The STB used the Coal 1427 Id. at 664-665 1428 Id. at 665-667. 1429 Burlington N. R. R. v. Surface Transportation Board, 114 F.3d 206, 210 (D.C. Cir. 1997) (quoting Consolidated Papers, Inc. v. CNW Transportation Co., 7 ICC2d 330, 339 (1991) (holding that railroad market dominance existed over eight traffic movements beginning February 27, 1979 and ending on certain dates due to market conditions)). 1430 114 F.3d 206 (D.C. Cir. 1997). 1431 Id. at 209. 1432 Id. 1433 Id. at 210.
295 Rate Guidelines (Guidelines) as a stand-alone test to determine whether the railroadâs rate was reasonable.1435 Under the Guidelines âa carrierâs rates may not exceed the rates a hypothetical âstand-alone railroadâ would have to charge in order to recover the costs of building a rail system to carry the complaining shippersâ traffic and earn a reasonable return.â1436 The court held that the STBâs use of the Guidelines was reasonable.1437 Articles 8. History of the Regulation and Deregulation of Railroads A recent law review article entitled âThe Rise and Fall of the Interstate Commerce Commission: the Tortuous Path from Regulation to Deregulation of Americaâs Infrastructureâ states that the transportation industry was the first major industry to be regulated in the United States and the first to be deregulated.1438 Initially, railroads were not highly regulated but reaction to price discrimination led state legislatures to enact laws regulating railroads.1439 In 1887, Congress enacted the Act to Regulate Commerce that created the ICC that would regulate the railroad industry.1440 The ICC, which had the authority to regulate interstate rates charged by railroads, required railroads to publicize their rates.1441 1434 Id. at 210, 211. 1435 Id. at 212. 1436 Id. 1437 Id. at 214. 1438 Paul Stephen Dempsey, âThe Rise and Fall of the Interstate Commerce Commission: the Tortuous Path from Regulation to Deregulation of Americaâs Infrastructure,â 95 Marq. L. Rev. 1151, 1152 (2012). 1439 Id. at 1158. 1440 Id. at 1160.
296 In 1920, Congress enacted the Esch-Cummins Act that gave the ICC the power to regulate entry and exit from markets and to regulate mergers.1442 However, after motor vehicles became a strong competitor to railroads, the ICC lost some of its independence and railroads became less profitable.1443 Deregulation was seen as a means to make the railroads more profitable and competitive by encouraging a free market model.1444 In 1995, Congress enacted the ICCTA that dissolved the ICC and transferred its powers to the STB.1445 The article notes the impact of the deregulation of the financial, electric power, and airline industries, stating that the deregulation of the industries led, respectively, to âa trillion-dollar bailout of the savings and loan industry;â âEnron wreak[ing] havoc on consumers and investors;â and the airlines lagging âin every category, including fleet age, service quality and international reputationâ compared to airlines in other countries.1446 The article argues that the deregulation of the railroad industry could have similar adverse effects on the economy and the public.1447 9. Anticompetitive Behavior An article entitled âInjecting Competition in the Railroad Industry through Accessâ in the Transportation Law Journal considers the anticompetitive effects of bottlenecking and how to 1441 Id. at 1161 (citing Interstate Commerce Act, ch. 104, 24 Stat. 379 (1887)). 1442 Id. at 1165 (citing Ch. 91, 41 Stat. 456 (1920)). 1443 Id. at 1171-1172. 1444 Id. at 1175. 1445 Id. at 1185. 1446 Id. at 1187-1188. 1447 Id. at 1188.
297 address them.1448 Bottlenecks are âportions of the [rail] network where only one railroad can provide services.â1449 When a railroad has exclusive control over a destination there is a risk of anticompetitive behavior. Thus, a shipper has to agree to the price offered by the railroad because there is no alternative means of shipment.1450 Although railroads have saved costs, it is said that the deregulation of the industry has not led to a reduction in shipping rates.1451 For example, â[s]hippers claim that the savings from deregulation are not sharedâ and that âcaptive shippers pay[] 20 to 30% higher rates than shippers who can choose between railroad carriers.â1452 According to the article, when the Union Pacific and Southern Pacific Railroads merged, there were promises of improved service and lower rates.1453 Although shippers have complained about service on the merged line, they have been reluctant to report the problem because of concern that the railroads may retaliate by increasing rates.1454 The article observes that the railroad industry is regulated by the STB, not by the antitrust laws, and argues that the STBâs policy is to approve mergers even if a merger will result in a 1448 Salvatore Massa, âInjecting Competition in the Railroad Industry through Access,â 27 Transp. L. J. 1 (2000), hereinafter referred to as âMassa.â 1449 Id. at 2. 1450 Id. at 4. 1451 Id. at 10-11. 1452 Id. at 11. 1453 Id. at 12. 1454 Id.
298 bottleneck.1455 The article states that the STB is likely to suggest a through route rather than reciprocal switching1456 as a remedy to bottlenecking.1457 If a shipper petitions for a reasonable rate, the ârailroad firm must show that the rate it charges âresults in a revenue-variable cost percentage for such transportation that is less than 180 percent.ââ 1458 Finally, the article offers four proposals to alleviate bottlenecking.1459 C. Antitrust Exemptions for Railroads Statutes 1. Sherman Antitrust Act Section 1 of the Sherman Antitrust Act declares illegal â[e]very contract, combination in the form of trust or otherwise, or conspiracy, in restraint of trade or commerce among the several States, or with foreign nations, is declared to be illegal.â1460 Section 1 continues: Every person who shall make any contract or engage in any combination or conspiracy hereby declared to be illegal shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $100,000,000 if a 1455 Id. at 13. 1456 The author explains that under a reciprocal switching arrangement ââa bottleneck carrier, for a fee, transports the cars of the non-bottleneck carrier over its lines to [the] destination, thereby permitting the non-bottleneck carrier to establish single-line rates for customers to which it does not have direct access.ââ Id. at 27 (citation omitted). 1457 Id. at 16-7. 1458 Id. at 17 (citation omitted). A âvariable cost ratio compares costs, which fluctuate depending on production levels, to the revenues made on those products. This ratio relates the specific costs to the revenues they generate.â Investopedia, Variable Cost Ratio, available at: http://www.investopedia.com/terms/v/variable-cost-ratio.asp (last accessed March 31, 2015). 1459 Massa, supra note 1448, at 23-40. 1460 15 U.S.C. § 1 (2014).
299 corporation, or, if any other person, $1,000,000, or by imprisonment not exceeding 10 years, or by both said punishments, in the discretion of the court.1461 Under section 2: Every person who shall monopolize, or attempt to monopolize, or combine or conspire with any other person or persons, to monopolize any part of the trade or commerce among the several States, or with foreign nations, shall be deemed guilty of a felony, and, on conviction thereof, shall be punished by fine not exceeding $100,000,000 if a corporation, or, if any other person, $1,000,000, or by imprisonment not exceeding 10 years, or by both said punishments, in the discretion of the court.1462 2. Railroadsâ Exemption from the Antitrust Laws Federal law, however, provides that [a] rail carrier, corporation, or person participating in that approved or exempted transaction is exempt from the antitrust laws and from all other law, including State and municipal law, as necessary to let that rail carrier, corporation, or person carry out the transaction, hold, maintain, and operate property, and exercise control or franchises acquired through the transaction.1463 3. Exemption of Rate Agreements from Antitrust Laws As stated, the ICCTA abolished the ICC and transferred its duties to its successor the STB. Federal law requires that [a] rail carrier providing transportation subject to the jurisdiction of the Board under this part that is a party to an agreement of at least 2 rail carriers that relates to rates ⦠shall apply to the Board for approval of that agreement under this subsection. ⦠If the Board approves the agreement, it may be made and carried out under its terms and under the conditions required by the Board, and the Sherman, the Clayton Act, the Federal Trade Commission Act, sections 73 and 74 of the Wilson Tariff Act, and the Act of June 19, 1936 do not apply to parties and other persons with respect to making or carrying out the agreement.1464 1461 Id. 1462 15 U.S.C. § 2 (2014). 1463 49 U.S.C. § 11321(a) (2014). 1464 49 U.S.C. § 10706(a)(2)(A) (2014) (emphasis supplied).
300 As the Second Circuit has stated, [b]ecause ⦠concerted action in the area of rate-making clearly falls within the proscriptions of the federal anti-trust laws, Congress in authorizing such associations exempted them from the anti-trust laws, but in so doing it provided that any agreement establishing the procedure for the determination of joint rates must afford âeach party the free and unrestrained right to take independent action either before or after any determination arrived at through such procedure.â1465 4. Exemption of Conferences on Unification and Coordination of Railroads from Antitrust Laws On the request of a railroad the Secretary of Transportation may hold conferences on the unification or coordination of railroads.1466 Attendees at such conferences, including âofficers and directors of an affected rail carrierâ and ârepresentatives of rail carrier employees who may be affected,â are not liable under the antitrust laws for their participation at the conference or for any agreements that are concluded with the approval of the Secretary of Transportation.1467 5. Exemption of Acquisitions Approved by the DOT from the Clayton Act Section 7 of the Clayton Act prohibits a corporation from acquiring the assets of another business entity when âthe effect of such acquisition may be substantially to lessen competition[] or tend to create a monopoly.â1468 However, the act specifically exempts all transactions approved by several federal agencies, including the Secretary of Transportation and the Surface Transportation Board.1469 1465 Ajayem Lumber Corp. v. Penn Cent. Transp. Co., 487 F.2d 179, 181 (2d Cir. 1973) (quoting 49 U.S.C. § 5b(6)). 1466 49 U.S.C. § 333(d) (2014). 1467 Id. 1468 15 U.S.C. § 18 (2014). 1469 Id.
301 Cases 6. Implied Immunity from Antitrust Litigation In In re Wheat Rail Freight Rate Antitrust Litigation1470 the plaintiff alleged that several railroads violated § 1 of the Sherman Act by conspiring to fix freight rail rates for wheat and wheat products. The Seventh Circuit held that a railroad is not expressly exempt from the antitrust laws when it does not adhere to a rate agreement approved by the ICC, now the STB.1471 However, the court held that a railroad is impliedly immune from antitrust liability when it fails to adhere to the procedural requirements of an agreement.1472 First, the court stated that it could not âdiscern ⦠how permitting antitrust suits to be filed against carriers who fail to follow the procedures of their Agreement promotes competition or provides some benefit to the ultimate consumer of the railroadsâ services.â1473 Second, â[t]o subject railroads to treble damages for a failure to follow the procedures of their Agreement might aid competitors, at least those who win their antitrust suits, but it does nothing to promote competition.â1474 Third, â[i]ncreased competition, in the sense of gaining a lower price or some other benefit for the consumer, [would] not be the result of an imposition of antitrust liability for failure to follow the procedures for collectively fixing these rates.â1475 Finally, the court stated that 1470 759 F.2d 1305, 1306 (7th Cir. 1985). 1471 Id. at 1309. 1472 Id. at 1316. 1473 Id. at 1315. 1474 Id. 1475 Id. at 1315-1316.
302 [t]he regulation of the railroad industry by the ICC prevents the antitrust laws from having their intended effect of increasing competition and benefitting consumers. To uphold antitrust liability here, then, would fail to promote the goals of the antitrust law while frustrating regulatory policy in the sense of creating uncertainty among carriers regarding liability for the very collective rate making activity in which they are obliged to engage.1476 7. ICCTAâs Preemption of Antitrust Claims under State Law In Fayus Enterprises v. BNSF Railway Co.1477 the plaintiffs alleged that several railroads violated state antitrust laws by conspiring to impose fuel surcharges in a manner that increased shipping rates above competitive levels. The District of Columbia Circuit, observing that not all antitrust suits are preempted by the ICCTA, held that antitrust claims invite âjudicial supervision of the reasonableness and fairness of rates charged to shippersâ and allow âstate law antitrust claims of this nature [to] undermine the deregulatory and anti-balkanization policies underlying the ICCTA.â1478 The court stated that the intent of Congress to preempt state antitrust laws is to be found in the ICCTA: âThe jurisdiction of the Board over ... transportation by rail carriers, and the remedies provided in this part with respect to rates, classifications [and] rules ... is exclusive.â1479 Articles 8. Elimination of Transportation Exemptions in Favor of Periodic Review of Transactions that have Anticompetitive Risks An article in the Oregon Law Review argues that there should be a revaluation of transportation industriesâ antitrust liability because the exemption of railroads from the antitrust 1476 Id. at 1316. 1477 602 F.3d 444, 445 (D.C. Cir. 2010), cert. denied, 2010 U.S. LEXIS 9776 (U.S., Dec. 13, 2010). 1478 Id. at 454. 1479 Id. at 446.
303 laws shields anticompetitive agreements that are contrary to the public interest.1480 The article notes that there are six antitrust exemptions for commercial transportation, including exemptions for railroads under the ICCTA.1481 The article argues that antitrust exemptions for transportation industries should be repealed and that any joint ventures or legitimate transactions that continue should be subject to periodic review.1482 The authorâs thesis is that transactions should be subject to review by the regulating agency and the Department of Justice after the parties request a âRobust Business Review Clearance.â1483 What is needed is access to a robust form of a time-limited, business review clearance explicitly focused on avoiding unnecessarily anticompetitive agreements or mergers while providing better protection for legitimate, reasonable ventures. ... The process should be based on the current review procedures already employed by the U.S. Department of Justice (DOJ) but should contain a more robust result, such as suspension of antitrust liability for the duration of that clearance, if the transaction or venture is found not to raise serious competitive concerns.1484 ⦠The clearance would, therefore, provide a shield from antitrust claims during the period of the clearance. No court could impose antitrust liability either for damages or injunctive relief based on conduct occurring during that period.1485 1480 Peter C. Carstensen, âReplacing Antitrust Exemptions for Transportation Industries: The Potential for a âRobust Business Review Clearance,ââ 89 Or. L. Rev. 1059, 1061-1062 (2011). 1481 Id. at 1065-1066. 1482 Id. at 1099. 1483 Id. 1484 Id. at 1062-1063 (footnote omitted). 1485 Id. at 1100 (footnotes omitted).
304 The article recommends that when a proposed transaction does not pose a risk to competition the parties should be immune from antitrust liability for a five-year renewable period.1486 9. Proposal that the Approval of Mergers be Transferred from the STB to the Courts An article in the Transportation Law Journal examines the public interest standard used by the STB in determining whether to approve a railroad merger; discusses how the STB has approved almost every proposed merger; and questions whether the courts rather than the STB should have authority to approve mergers.1487 The article focuses on the merger of the Union Pacific and Southern Pacific railroads that was approved, even though the merger reduced the number of Class I railroads west of the Mississippi to two and was alleged by âshippers, other railroad carriers, state governments, and the U.S. Department of Justiceâ to be anticompetitive.1488 Under the STBâs public interest standard, a merger of two Class I railroads requires application of the five factor test quoted in part X.B.2 of the Report.1489 The STB approved the merger of the Union Pacific and Southern Pacific railroads because the Board found that the benefit to the public interest substantially outweighed any anticompetitive costs. The Board 1486 Id. 1487 Salvatore Massa, âAre All Railroad Mergers in the Public Interest? An Analysis of the Union Pacific Merger with Southern Pacific,â 24 Transp. L. J. 413, 415-416 (1996). 1488 Id. at 415. 1489 Id. at 418 (citing 49 U.S.C. § 11344(b)(1) and 49 C.F.R. § 1180.1).
305 rejected the contention that the merger would create a duopoly to control prices.1490 The article argues, however, that the STB approves mergers because of a political agenda favoring deregulation.1491 The writer contends that because courts are âpolitically neutralâ the courts are âbest suitedâ to review proposed mergers.1492 According to the article, the concern is that the continued approval of applications for mergers of Class I railroads will lead to only one or two transcontinental railroad systems, thus increasing the risk of anticompetitive pricing.1493 10. Proposed Legislation that would Affect the Antitrust Exemptions of Railroads An article in the Administrative Law Review examines the economic consequences of an antitrust act applicable to railroads. More specifically, the article weighs the benefits, if Congress had enacted the proposed legislation, of the Railroad Antitrust Enforcement Act of 2009.1494 In January 2009, when the bill was introduced in both houses of Congress, the bill proposed amending certain federal statutes applicable to railroads and anticompetitive 1490 The author summarizes the five factor test thusly: (1) the impact the merger has on the adequacy of public transportation; (2) the effect of including or excluding other railroads in the region from the transaction on the public interest; (3) the total fixed charges that result from the transaction; (4) the interest of railroad employees affected by the transaction; and (5) the adverse effect on railroad competition in the affected region. Id. at 422-423. 1491 Id. at 440. 1492 Id. 1493 Id. at 441-442. 1494 Russell Pittman, âRecent Development: The Economics of Railroad âCaptive Shipper,ââ 62 Admin L. Rev. 919 (2010), hereinafter referred to as âPittman.â The Railroad Enforcement Act of 2009 was never enacted but the Railroad Enforcement Act that was introduced in Congress in 2013 proposed the elimination of antitrust exemptions for railroads.
306 behavior.1495 Although the proposed legislation would not have eliminated antitrust exemptions for railroads, it would have increased the scrutiny of âpaper barriersâ and ârefusals to deal.â1496 A paper barrier âis a contractual clause limiting the ability or incentive of the purchaser or lessee of a rail line to interchange traffic with railroads other than the lineâs seller or lessor.â1497 A ârefusal to dealâ is when a shipper is served by a railroad that refuses either to (a) allow the trains of a competing railroad to serve the shipper over the monopoly railroadâs tracks[] or [to] (b) offer to carry the shipperâs goods only to the nearest interchange with a competing railroad, rather than insisting on hauling the goods for the entire route itself.1498 According to the article, the legislation, if enacted, would have protected captive shippers and increased competition, as well as reduced the profits of Class I railroad companies, which the author contends are earning profits in excess of normal returns.1499 D. Competitive Access for Railroads Statutes 1. Use of Terminal Facilities and Reciprocal Switching Agreements Federal law provides in part that the Board may require terminal facilities, including main-line tracks for a reasonable distance outside of a terminal, owned by a rail carrier providing transportation subject to the jurisdiction of the Board under this part, to be used by another rail 1495 Id. at 920. 1496 Id. at 926. 1497 Surface Transportation Board, Surface Transportation Board Proposes Additional Reporting Requirements for Interchange Commitments, available at: http://www.stb.dot.gov/newsrels.nsf/cee25ffbd056e9d1852565330043f0d6/e4624ecadcf001e285257aa90 0514d2d?OpenDocument (last accessed March 31, 2015). 1498 Pittman, supra note 1494, at 930. 1499 Id. at 934-935.
307 carrier if the Board finds that use to be practicable and in the public interest without substantially impairing the ability of the rail carrier owning the facilities or entitled to use the facilities to handle its own business.1500 The law also provides that â[t]he rail carriers are responsible for establishing the conditions and compensation for use of the facilities. However, if the rail carriers cannot agree, the Board may establish conditions and compensation for use of the facilitiesâ¦.â1501 Furthermore, [t]he Board may require rail carriers to enter into reciprocal switching agreements, where it finds such agreements to be practicable and in the public interest, or where such agreements are necessary to provide competitive rail service.... The Board may require reciprocal agreements entered into by rail carriers pursuant to this subsection to contain provisions for the protection of the interests of employees affected thereby.1502 The purpose of the law is to increase competition in areas where reciprocal switching is possible to aid shippers.1503 Proceeding 2. Proposal to the STB Requesting a Modification of the Mandatory Competitive Switching Standards In 2011, the National Industrial Transportation League (NITL) petitioned the STB to modify its standards for mandatory competitive switching.1504 Because the Board was not provided with information that would allow it to determine the impact of the proposed changes, 1500 49 U.S.C. § 11102(a) (2014). 1501 Id. 1502 49 U.S.C. 11102(c) (1) (2014). 1503 Central States Enterprises, Inc. v. Interstate Commerce Com., 780 F.2d 664, 668-669 (7th Cir. 1985). 1504 Petition, Docket No. EP 711, 42264, 2012 STB Lexis 273, at *2.
308 the STB asked the parties to provide additional information.1505 The STB requested information on: (1) the impact on rates and service for shippers that would qualify under the competitive switching proposal; (2) the impact on rates and service for captive shippers that would not qualify under this proposal (because they are not located in a terminal area or within 30 miles of a working interchange); (3) the impact on the railroad industry, including its financial condition, and network efficiencies or inefficiencies (including the potential for increased traffic); and (4) an access pricing proposal.1506 The STB also asked those commenting to analyze the ramifications of modifying the NITLâs proposal.1507 The NITLâs proposal would require competitive switching by a Class I rail carrier if four conditions were met: (1) the shipper (or group of shippers) is served by a single Class I rail carrier; (2) there is no effective intermodal or intramodal competition for the movements for which competitive switching is sought; (3) there is or can be âa working interchangeâ within a âreasonable distanceâ of the shipperâs facility; and (4) switching is safe and feasible, with no adverse effect on existing service.1508 The Association of American Railroads (AAR), representing Class I railroads, opposed the NITL proposal and argued that no changes were needed to the STBâs regulations on competitive access.1509 Stating that it wanted to receive more information on the impact of the proposal, the STB failed to issue a final determination.1510 On October 16, 2013, because of a 1505 Id. at *3-4. 1506 Id. at *4. 1507 Id. at *4-5. 1508 Id. at *9-10. 1509 Id. at *13. 1510 Id. at *21.
309 government shutdown, the STB postponed the hearing on Ex Parte 711 that had been scheduled for October 22, 2013, without setting a new date for a hearing.1511 1511 Id. at *2.
310 XI. CONSTITUTIONAL LAW AND RAILROADS A. Introduction Although the primary basis on which a railroad challenges a state law is that federal law preempts the state law, state laws regulating railroads also may be challenged for being unconstitutional under the Fourteenth Amendment to the United States Constitution. Thus, even if a state statute is not preempted, the state law still may be unconstitutional. It should be noted that some of the statutes discussed herein, which the courts held were constitutional, were later held to be preempted by federal law. Section B discusses the provisions in the United States Constitution that railroad companies have used to challenge state statutes. Sections C and D discuss some of the state statutes that railroads have challenged, such as laws that require full crews on trains or that require railroads to fence railroad rights of way to protect adjacent property and livestock. Section D discusses a cases brought by plaintiffs alleging that a transit authority violated their Fourth Amendment rights. B. The United States Constitution First, under Article I of the United States Constitution the Congress is empowered â[t]o regulate Commerce ... among the several States.â1512 Railroad companies have challenged state laws applicable to railroads on the basis that they violate the Commerce Clause by regulating interstate commerce impermissibly or because the state laws unduly burden interstate commerce. Second, the Constitutionâs Contract Clause states that â[n]o State shall ... make any ... Law impairing the Obligation of Contracts....â1513 Railroads have challenged the validity of a 1512 U.S. Const. Art. I § 8, cl. 3.
311 state law under the Contracts Clause on the basis that the statute nullifies a provision of a contract to which a railroad is a party. Third, under the Fourteenth Amendment to the Constitution â[n]o State shall ... deprive any person of life, liberty, or property, without due process of law; nor deny to any person within its jurisdiction the equal protection of the laws.â1514 Cases reviewed for this section of the Report frequently involved challenges to state law on the grounds of alleged violations of the Due Process and Equal Protection Clauses. As noted, even if a state statute affecting railroads is constitutional the statute may be preempted by federal law. Statutes C. State Statutes Requiring Full Crews Railroads have challenged state laws requiring full crews on the ground that they are unconstitutional because other common carriers are not required to have the same number or types of employees in their crews. A full crew statute has been held not to violate the Due Process Clause or the Equal Protection Clause of the Fourteenth Amendment. Under the Wisconsin full crew law a train operator in Wisconsin is required to have a crew consisting of at least two members, one of whom has to be a certified railroad locomotive engineer. The other member may hold the same position or be a qualified trainman.1515 1513 U.S. Const. Art. I § 10, cl. 1. 1514 U.S. Const. Amend. 14 § 1. 1515 Wis. Stat. § 192.25(2) (2014).
312 Cases 1. State Statute Requiring a Full Crew on Trains does not Violate the Due Process Clause or the Equal Protection Clause As described by the Supreme Court in Brotherhood of Locomotive Firemen & Enginemen v. Chicago, R. I. & P. R. Co.,1516 for safety reasons Arkansas required trains travelling at least fifty miles to have an engineer, a fireman, a conductor, and three brakemen on board. The Chicago, Rock Island & Pacific Railroad Co. challenged the statutes on the grounds that they violated the Due Process and Equal Protection Clauses. The Supreme Court held that the statutes did not violate the Equal Protection Clause because requiring ââan engineer, a fireman, a conductor and three brakemen[]â could scarcely be extended in their present terms to such means of transportation as taxicabs or airplanes.â1517 The legislature is not ârequired to investigate the various differing hazards encountered in all competing industries and then to enact additional legislation to meet these distinct problems.â1518 The Court held that because the additional costs imposed on the railroads in having the crewmen aboard were not âunduly oppressiveâ there was no violation of the Due Process Clause.1519 Finally, there was no violation of the Commerce Clause because Arkansas may decide the âprice society should pay to promote safety in the railroad industry.â1520 1516 393 U.S. 129, 131, 89 S. Ct. 323, 324, 21 L. Ed.2d 289, 392-393 (1968). 1517 Id., 393 U.S. at 143, 89 S. Ct. at 330, 21 L. Ed.2d at 299. 1518 Id. 1519 Id. 1520 Id., 393 U.S. at 144, 89 S. Ct. at 331, 21 L. Ed.2d at 300.
313 Likewise, in Chicago & N.W. Ry. Co. v. La Follette,1521 in which eight interstate railroad companies challenged Wisconsinâs full crew statutes, the court held the that the statutes were not unconstitutional. The statutes in question were Wis. Stat. § 192.25(2) (requiring a fireman in a five-man crew inroad or outside of yard freight service); Wis. Stat. § 192.25(4) (requiring a three-man crew in a single engine); and Wis. Stat. § 192.25(4a) (requiring a five-man crew for switching operations). For example, Wisconsin required a minimum crew of at least âfive men [that] must consist of âan engineer, a fireman, a conductor, and 2 brakemenââ for trains operating at least ten miles of route outside of yard limits.1522 The companies alleged that the Wisconsin full crew laws violated the Due Process Clause because of the burden associated with employing firemen.1523 The companies argued that the requirement to maintain a fireman as part of a crew violated a railroad companyâs freedom to contract and violated due process unless the requirement was an exercise of the stateâs police power.1524 In determining whether the statute was arbitrary and unreasonable, the Supreme Court of Wisconsin considered the cost of complying with the statute. The plaintiffs argued that the cost of using the required firemen was over $6 million per year, costs that were not justifiable.1525 However, the court held that â[t]f there is any reasonable basis for the exercise of police power by the legislature the court must uphold the right of the legislature to act.â1526 The 1521 43 Wis.2d 631, 169 N.W.2d 441 (1969). 1522 Id., 43 Wis.2d at 649, 169 N.W.2d at 449 (quoting Wis. Stat. § 192.25 (2)). 1523 Id., 43 Wis.2d at 645, 169 N.W.2d at 447. 1524 Id., 43 Wis.2d at 644, 169 N.W.2d at 446. 1525 Id., 43 Wis.2d at 651, 169 N.W.2d at 450.
314 court held that the additional costs were justified because requiring firemen on trains increased rail safety.1527 The railroads also alleged a violation of the Equal Protection Clause because the full crew statutes did not apply to ârailroads that operate less than 10 miles of route outside of yard limits.â1528 However, the court held that the full crew statutes were reasonably related to safety and thus was constitutionally permissible.1529 However, it has been ruled that some of the provisions of the aforesaid Wisconsin statutes are preempted by federal law. In 1999 in Burlington N. & Santa Fe Ry. Co. v. Doyle1530 the Seventh Circuit held that the qualification requirements for locomotive engineers in sec. 192.25(1)(a) and for trainmen in sec. 192.25(1)(b) are preempted. Section sec. 192.25(2)âs requirement that a locomotive engineer be at the controls of a locomotive anytime it moves is also preempted. Section 192.25(2)âs two-person crew requirement is preempted for hostling and helper movements. It is also preempted to the extent that one-person operations are the subject of a Safety Compliance Agreement between Wisconsin Central and [the] FRA. Finally, the preempted portions of the statute are severable from the rest so that those provisions [that are] not preempted may stand on their own.1531 Likewise, in Norfolk and Western Ry. Co. v. Public Service Commission of West Virginia1532 the railroad company challenged a West Virginia statute that required a minimum 1526 Id., 43 Wis.2d at 646, 169 N.W.2d at 447. 1527 Id., 43 Wis.2d at 651-652, 169 N.W.2d at 450-451. 1528 Id., 43 Wis.2d at 655, 169 N.W.2d at 452. 1529 Id., 43 Wis.2d at 658, 169 N.W.2d at 454. 1530 186 F.3d 790 (7th Cir. 1999). 1531 Id. at 804-805. 1532 858 F. Supp. 1213 (Special Court 1994).
315 crew of two men on all locomotives.1533 The special court established to adjudicate issues arising out of the 3R Act observed that the Act as amended by the § 711 of the Northeast Rail Service Act provided that â[n]o state may adopt or continue in force any law ⦠requiring ⦠[regional railroads] to employ any specific number of persons to perform any particular taskâ¦.â1534 Thus, West Virginiaâs minimum crew statute was preempted. 2. State Statutes requiring Fencing do not Violate the Due Process or Equal Protection Clauses In Berens v. Chicago M. S. P & P. R. Co.1535 the Supreme Court of South Dakota analyzed how the Due Process and Equal Protection Clauses apply to state laws that govern railroads. As noted, under South Dakota law railroads have an obligation to construct fences along their tracks, for example, to prevent harm to livestock.1536 A railroad may be held liable for any damages caused by a failure to maintain a fence or otherwise comply with the fencing statutes. Under the statute âthe killing or injuring of livestock by [a] railroad corporation, its agents, or employees [is] prima facie evidence of negligence.â1537 1533 Id. at 1215. 1534 Id. at 1215 (quoting Northeast Rail Service Act § 711, 45 U.S.C. § 797j (1988)). 1535 80 S.D. 168, 120 N.W.2d 565 (1963). See also, Union Pac. R.R. v. La. PSC, 2010 U.S. Dist. LEXIS 122462, at *1 (M.D. La. 2010) (holding that Louisiana state laws regulating railroads did not violate Union Pacificâs federal or state equal protection guarantees because the railroad company was not being treated differently from other common carriers); Linenbrink v. Chicago & N. W. Ry. Co., 177 Neb. 838 (Neb. 1964) (holding that the classification of railroads and motor carriers is not arbitrary and in violation of the Due Process and Equal Protection Clauses because the classification promotes the public interest and welfare); Chicago & N. W. R. R. v. Bishop, 390 P.2d 731 (Wyo. 1964) (holding that a state law requiring the fencing of public roads adjacent to railroads to protect livestock does not violate the Equal Protection Clause). 1536 Berens, 80 S.D. at 171, 120 N.W.2d at 567-568. 1537 Id., 80 S.D. at 173, 120 N.W.2d at 569.
316 In Berens, the railroad argued that the South Dakota laws were an unconstitutional denial of equal protection under the Fourteenth Amendment because the statutes were not imposed on âmotor carriers of freight and passengers travelling over public highways.â1538 However, the court held that when âthe legislature exercises its police powers, and a classification is made that is reasonable and not arbitrary, there is no denial of equal protection of the law.â1539 Although âmotor carriers and railroads are engaged in the same general business[] ⦠the methods and means by which they perform their functions are far different and the legislature is acting within its prerogative to separate them into classes for regulation.â1540 The court held that because the legislature was within its right to change the burden of proof the statuteâs presumption of liability was not a denial of equal protection.1541 3. State Requirement of a Manned Caboose held not to Violate the Commerce Clause or the Contracts Clause A Nebraska statute required âthat the last car on any train over 1,000 feet long operating in the state must be a manned caboose.â1542 In Burlington N. R. Co. v. Nebraska1543 the Eighth 1538 Id., 80 S.D. at 176, 120 N.W.2d at 571. 1539 Id., 80 S.D. at 174, 120 N.W.2d at 569. 1540 Id., 80 S.D. at 176, 120 N.W.2d at 571. 1541 Id., 80 S.D. at 175, 120 N.W.2d at 570. 1542 Burlington N. R. Co. v. Nebraska, 802 F.2d 994, 996 (8th Cir. 1986) (quoting Neb. Rev. Stat. § 74- 5,100) (repealed 1994) (superseded by statute as stated in Ragland v. State, 385 Md. 706, 870 A.2d 609 (2005)). 1543 Id. at 996-997. See also, Warner Bros. Entmât, Inc. v. X One Prods, 644 F.3d 584 (8th Cir. 2011); US Salt, Inc. v. Broken Arrow, Inc., 563 F.3d 687 (8th Cir. 2009); Educational Employees Credit Union v. Mutual Guar. Corp., 50 F.3d 1432 (8th Cir. 1995); TIC- Indus. Co. Wyo., Inc. v. Factory Mut. Ins. Co., 2012 U.S. Dist. LEXIS 95687, at *1 (D. Neb. 2012); Lexar Energy, Inc. v. Macquarie Bank Ltd., 2010 U.S. Dist. LEXIS 124094, at *1 (D. N.D. 2010); Duluth Lighthouse for the Blind v. C.G. Bretting Mfg.
317 Circuit held that the requirement that railroads have a manned caboose was not a violation of the Commerce and Contract Clauses of the United States Constitution. It should be noted that in 1989, after Burlington Northern challenged a Minnesota statute that required a manned caboose, the Eighth Circuit held that the Federal Railroad Administrationâs (FRA) âpower brake and rear-end marking device regulations, which accommodate the operation of cabooseless trains, and the FRAâs refusal to impose a caboose requirement[,] preempt the Minnesota occupied caboose law.â1544 Minnesota argued that neither Congress nor the FRA intended to preempt its caboose law, and, therefore the FRA regulations did not preempt the statute.1545 The court, however, observed that the FRA apparently did not consider the lack of a caboose to be a safety issue because it had failed to provide for a mandatory caboose requirement. The court held that the lack of a caboose regulation âhas taken on the character of a ruling that no such regulation is appropriate[] and is therefore the kind of inaction that has preemptive effect.â1546 Because Minnesotaâs caboose requirement conflicts directly with the FRAâs implied ruling that manned cabooses or cabooses generally are not required, the court that held federal law preempts the Minnesota statute.1547 Co., 199 F.R.D. 320 (D. Minn. 2000); Hartzell Mfg. v. American Chem. Technologies, 899 F. Supp. 405 (D. Minn. 1995). 1544 Burlington N. R. Co. v. Minnesota, 882 F.2d 1349 (8th Cir. 1989). 1545 Id. at 1352. 1546 Id. at 1353-1354 (citations omitted). 1547 Id. at 1354.
318 D. Violation of the Fourth Amendment by a Railroad Security Officer Acting under Color of State Law In George v. CSX Transp. Inc.1548 the plaintiffs were stopped by a CSX police officer.1549 After OâKeefe used his police lights to compel George, the driver, to stop,1550 he detained the plaintiffs for a hour, issued George two tickets for violating New York laws, and then released them.1551 The plaintiffs alleged that the vehicle stop was a Fourth Amendment seizure and that CSX and OâKeefe knew or should have known that OâKeefe lacked the authority to issue tickets.1552 A federal district court in New York began its inquiry by determining whether OâKeefe was acting under color of state law and, if so, had deprived the plaintiffs of a constitutional right.1553 The court held that OâKeefe was acting under color of state law because the New York Railroad Law âgives railroad police full police authority.â1554 OâKeefeâs use of the police lights on his vehicle and his approach of the plaintiffs in a police uniform gave the impression that OâKeefe had police power.1555 However, the court dismissed the plaintiffsâ claims of false arrest and malicious prosecution in violation of the Fourth Amendment pursuant to 42 U.S.C. § 1983 because the plaintiffs failed to allege that OâKeefe did not have probable cause to stop Georgeâs 1548 2014 U.S. Dist. LEXIS 10324, at *1 (E.D. N.Y. 2014). 1549 Id. at *1-2. 1550 Id. at *2. 1551 Id. 1552 Id. at *2-3. 1553 Id. at *4. 1554 Id. at *4-5 (citing N. Y. R. R. Law § 88 (2014)). 1555 Id. at *7.
319 vehicle.1556 In addition, the court dismissed the plaintiffsâ state law claim for malicious prosecution because it was identical to the federal statute.1557 Finally, the court dismissed the plaintiffsâ substantive due process claim, as well as the plaintiffsâ remaining claims under state law.1558 1556 Id. at *9. 1557 Id. at *12-13. 1558 Id. at *14-15.
320 XII. CONSTRUCTION CONTRACTS A. Introduction This part of the Report discusses statutes, cases, and an article on construction contracts involving railroads. Sections B through D describe three state statutes, the first of which provides for a lien on railroad property when a railroad enters into a construction contract. The other two statutes apply to construction contracts between state agencies and railroads. Sections E through J discuss holdings in recent cases regarding contractual indemnification of a railroad company for an injury to an employee during construction; when a contract is a construction contract under state law; whether and when indemnity provisions are against public policy; the conflict between a public policy against indemnity agreements in certain construction contracts and a public policy in favor of a railroad companyâs ability to grant easements; a railroad companyâs liability for active interference with a contractor; and how an indemnity agreement may be affected by a choice of law provision. Section K discusses an article on indemnity clauses and public policy under Virginia law. Statutes B. Lien on Railroad Property by reason of a Construction Contract A Tennessee statute provides that when âany railroad company contracts with any person for the grading of its roadway, the construction or repair of its culverts, bridges, and masonry, [and other work], or for the delivery of material for any of these purposes, or for engineering â¦, there shall be a lien upon such railroad, its franchise and property, in favor of the person with
321 whom the railroad company contracts for the performance of the work or the delivery of the materials, to the amount of the debt contracted for such performance or delivery.â1559 C. Authority to a Railroad Company Change the Grade of Existing Tracks or to Construct New Tracks Under a New Jersey statute a municipality may enter a contract with any railroad company whose road lies wholly or partially within the municipality or whose route has been located therein as will secure greater safety to persons or property therein, or will facilitate the construction or maintenance of other than grade crossings of streets, highways or other railroads, or will provide for increased or improved station or terminal facilities and transportation service, or will improve the surroundings of or make more convenient the access to a station of the railroad within the municipality. ⦠The railroad company may locate, relocate, change, alter grades of, depress or elevate any of its railroad tracks, bridges or facilities, and construct new or additional tracks and transportation or station facilities as shall be specified and provided for in the contract. ⦠The cost and expenses of such lands, changes and improvements shall be borne by the municipality and the railroad company in such shares or proportions as may be provided in the contract.1560 D. Authorization under State Law to Enter into Contracts with Railroad Companies for the Construction of Grade Crossings or Tracks A South Carolina statute provides that the South Carolina Department of Transportation (SCDOT) âmay, without formalities of advertising, enter into lawful and appropriate agreements and contracts with railroad companies for the construction, reconstruction, or modifications of railroad-highway grade separation crossings or track or other property rearrangementâ¦.â1561 The SCDOT may enter into contracts âwith other persons, similarly jointly interested in 1559 Tenn. Code § 65-10-101 (2014). 1560 N.J.S.A. § 48:12-79 (2014). 1561 S.C. Code § 57-5-1640 (2014).
322 particular items as property owners or lessees, for moving, clearing, rearranging or relocating public utilities, buildings and other structures.â1562 Cases E. Indemnity of a Railroad Company under a Construction Contract for an Injury to an Employee during Construction In Brown v. Baltimore & Ohio Railroad Co.1563 the county of Baltimore and the Baltimore and Ohio Railroad Company (B&O) had an agreement permitting the county to construct a sewer pipe under a railroad track. The county agreed to indemnify B&O for any injury, death, or damage arising out of the construction, maintenance, or relocation of the pipe. After the county contracted with a third party to construct the new pipeline, a train collided with a machine used by the construction company that was parked on the railroad tracks that caused an injury to a railroad employee.1564 At trial a jury found that B&O and the construction companies were liable as joint tortfeasors to the employee.1565 Holding that the parties intended to interpret the indemnification clause in the construction contract broadly, the court entered judgment for B&O against the county under the indemnification clause.1566 In upholding the decision, the Fourth Circuit ruled that a Maryland statute, which provided that indemnity clauses in certain circumstances were void, did not void the indemnity 1562 Id. 1563 805 F.2d 1133, 1135 (4th Cir. 1986). 1564 Id. at 1136. 1565 Id. 1566 Id. at 1136, 1140.
323 clause in the contract between the county and B&O.1567 The Maryland statute was intended to void indemnity clauses that would permit construction companies to avoid liability for their own actions. The court held that the statute was not intended to apply to licensors or easement grantors such as the B & O who enter into railroad crossing indemnity agreements of this type. By such agreements railroads have long and customarily sought protection against liability resulting or arising in any way from their grants, for a multitude of purposes, of easements or licenses to use or cross their rights of way.1568 F. Whether a Contract with a Railroad to Paint a Bridge is a Construction Contract In Kurtin v. Natâl Passenger R.R. Corp.1569 Amtrak had hired Campbell, a painting company, to paint a bridge. After a Campbell employee fell from the bridge, the injured employee sued Amtrak. Amtrak brought an action against Campbell, which brought an action against its insurance company.1570 The insurance companyâs policy covered bodily injury âassumed by the insured under an âinsured contractââ and further provided that âan âinsured contractâ does not include that part of any contract or agreement that indemnifies any person or 1567 Id. at 1141-42. The statute provided: A covenant, promise, agreement or understanding in, or in connection with or collateral to, a contract or agreement relating to the construction, alteration, repair, or maintenance of a building, structure, appurtenance or appliance, including moving, demolition and excavating connected with it, purporting to indemnify the promisee against liability for damages arising out of bodily injury to any person or damage to property caused by or resulting from the sole negligence of the promisee or indemnity [sic], his agents or employees, is against public policy and is void and unenforceable. This section does not affect the validity of any insurance contract, workmenâs compensation, or any other agreement issued by an insurer. Md. Cts. and Jud. Proc. Code Ann. § 5-305 (1973). 1568 Brown, 805 F.2d at 1141-1142 (footnote omitted). 1569 887 F. Supp. 676, 679 (S.D.N.Y. 1995). 1570 Id. at 677.
324 organization for âbodily injuryâ ⦠arising out of construction ⦠within fifty feet of any railroad property.â1571 Campbell argued that its contract with Amtrak to paint the bridge did not come within the meaning of the term construction.1572 Although New Yorkâs labor laws defined construction to include painting, a federal district court in New York held that the term construction should be given its normal meaning and that a contract for the painting of a bridge was not a construction contract within the meaning of the insurance policy.1573 G. Whether Indemnity Provisions are against Public Policy In S. Pac. Transp. Co. v. Sandyland Protective Assân1574 the Sandyland Protective Association (Association), a homeowners association, and Southern Pacific entered into a contract to allow the Association to build a road across Southern Pacificâs tracks. The contract contained a clause for the indemnification of Southern Pacific.1575 After a train hit a car and injured the passengers, the passengers brought an action against Southern Pacific, which brought an action against the Association for indemnity.1576 The Association defended on the basis that a 1571 Id. at 678. 1572 Id. at 679. 1573 Id. at 680, 681. 1574 224 Cal. App.3d 1494, 1496, 274 Cal. Rptr. 626 (Cal. Ct. App. 1990). 1575 Id., Cal. App.3d at 1496-1497, 274 Cal. Rptr. at 627-628. 1576 Id., Cal. App.3d at 1497, 274 Cal. Rptr. at 628.
325 California statute voided contractual provisions as against public policy that indemnify a promissee for an injury or death caused by the promiseeâs negligence.1577 A California appellate court observed that the statuteâs intent was that a non-negligent party to a construction contract will not be held liable for the other partyâs negligence.1578 Therefore, because the purpose of the indemnity clause between the Association and Southern Pacific was to shift responsibility for the railroadâs negligence to the Association, the indemnity provision was void.1579 H. Conflict between a Public Policy against Indemnity Agreements in Construction Contracts and a Public Policy in favor of a Railroadâs Ability to Grant Easements In Helm v. W. Md. Ry. Co.,1580 after the Western Maryland Railway Company (Western Maryland) lost a case to an injured employee, Western Maryland sought to enforce an indemnity clause in its construction contract with the county that permitted the county to perform construction work on the railway. The district court held that the indemnity provision was void under a Maryland statute that voids indemnity agreements in certain construction contracts to 1577 Id. See Cal. Civ. Code § 2782(a) (2014) that provides: Except as provided in Sections 2782.1, 2782.2, 2782.5, and 2782.6, provisions, clauses, covenants, or agreements contained in, collateral to, or affecting any construction contract and that purport to indemnify the promisee against liability for damages for death or bodily injury to persons, injury to property, or any other loss, damage or expense arising from the sole negligence or willful misconduct of the promisee or the promiseeâs agents, servants, or independent contractors who are directly responsible to the promisee, or for defects in design furnished by those persons, are against public policy and are void and unenforceable; provided, however, that this section shall not affect the validity of any insurance contract, workersâ compensation, or agreement issued by an admitted insurer as defined by the Insurance Code. 1578 S. Pac. Transp. Co., 224 Cal. App.3d at 1498, 274 Cal. Rptr. at 629. 1579 Id., 224 Cal. App.3d at 1498-1499, 274 Cal. Rptr. at 629. 1580 838 F.2d 729 (4th Cir. 1988).
326 prevent the indemnification of a promisee for injury and liability caused by the promiseeâs negligence.1581 The issue for the Fourth Circuit was whether the railroad licensing agreement at issue was a construction agreement within the meaning of the Maryland statute.1582 In an earlier case, Brown v Balt. & Ohio Railroad,1583 the Fourth Circuit had held that the statute was not applicable to licensors and grantors of easements.1584 In that case B&O granted an easement but did not control performance of the construction contract.1585 The Fourth Circuit stated that two public policies were in conflict. On the one hand, Maryland wanted parties to construction contracts to be responsible for their negligence but on the other hand wanted railroads to grant easements.1586 The court distinguished its decision in Brown v Balt. & Ohio Railroad, supra, because in this case Western Maryland was involved in the construction work for which it granted the easement.1587 The Fourth Circuit affirmed the summary judgment granted by the district court against Western Maryland that had sought to enforce the indemnity clause.1588 1581 Id. at 730, 731 (citing Md. Code Ann., Cts. & Jud. Proc. § 5-305 (1984)). 1582 Id. at 732. 1583 805 F.2d 1133 (4th Cir. 1986). 1584 Helm, 838 F.2d at 732. 1585 Id. 1586 Id. 1587 Id. 1588 Id. at 735.
327 I. Railroadâs Liability for Active Interference with a Contractor In U.S. Steel Corp. v. Mo. Pac. R.R. Co.1589 the Missouri Pacific Railroad (Missouri Pacific) entered into a contract with the American Bridge Division (ABD) of United States Steel for work on a bridge. The ABD could not begin work until a subcontractor had completed its work. The ABD was liable under its contract with Missouri Pacific on a per diem basis for delayed performance.1590 Missouri Pacific notified the ABD when a subcontractor was expected to finish work, a notice that signaled ABD to begin preparations for construction. Because of the subcontractorâs delays, ABD began work 175 days behind schedule. Missouri Pacific accordingly adjusted ABDâs completion date.1591 However, because Missouri Pacific did not inform the subcontractor of certain complications of which the railroad was aware the subcontractorâs work was delayed. The district court held that, because Missouri Pacific gave notice to ABD when it should begin construction while knowing of complications affecting the subcontractor, Missouri Pacific had interfered with ABDâs performance and therefore awarded damages to ABD.1592 On appeal, Missouri Pacific challenged the exception for active interference to the no damage clause in the contract.1593 The active interference exception required an affirmative act that interfered with the contractorâs work.1594 The Eighth Circuit held that Missouri Pacific was 1589 668 F.2d 435 (8th Cir. 1981). 1590 Id. at 437. 1591 Id. 1592 Id. at 438. 1593 Id. 1594 Id. at 439.
328 able to determine when ABD should commence work but that ABD could not forgo initiating its work and risk a breach of contract.1595 Therefore, the court held that Missouri Pacific actively interfered with ABDâs performance and that the no damage clause was unenforceable.1596 J. Interpretation of an Indemnity Provision Determined by the Contractâs Choice of Law Provision In Wallace v. Amtrak1597 Weeks Marine, Inc. (Weeks) had a contract with Amtrak pursuant to which Weeks was to be the principal contractor for the rehabilitation of a bridge. The contract between Weeks and Amtrak had both a provision indemnifying Amtrak and a provision requiring Weeks to obtain insurance.1598 Accordingly, Weeks purchased a railroad protective liability policy from Liberty Surplus Insurance Corp.1599 After an employee of Weeks was injured while working on the bridge, Weeks denied its responsibility to defend the claim but provided counsel to represent Amtrak.1600 Weeks argued that under New York law Amtrak could not be indemnified under the contract because Amtrak could not be indemnified for incidents caused by its own negligence.1601 Amtrak argued that the contract stated that the law of the District of Columbia 1595 Id. 1596 Id. 1597 2014 U.S. Dist. LEXIS 36346, at *1, 3 (S.D.N.Y. Mar. 18, 2014). 1598 Id. at *10-14. 1599 Id. at *14. 1600 Id. at *5-10. 1601 Id. at *55-56.
329 applied.1602 A federal district court in New York, applying District of Columbia law, held that Weeks was not liable for a breach of contract because it denied its obligation to indemnify.1603 However, the court held that Weeks was responsible for any claim brought by an employee because under District of Columbia law a party may be indemnified under a contract regardless of the partyâs negligence.1604 Article K. Indemnity Clauses and Public Policy under Virginia Law A law review article on developments in construction law in Virginia that also covers indemnity clauses in construction contracts discusses W.R. Hall, Inc. v. Hampton Roads Sanitation District,1605 a case that involved a railroad company.1606 As explained by the article, the issue was whether âa broad indemnification provision in a construction contract violated Virginia public policy.â1607 The Hampton Roads Sanitation District (HRSD) entered into an indemnity agreement with the Belt Line Railroad (Belt Line) regarding HRSDâs proposed installation of a sewer line on railroad property.1608 Thereafter, the HRSD entered into a contract with a contractor that âincluded broad indemnity provisions ⦠requiring the contractor to hold 1602 Id. 1603 Id. at *61. 1604 Id. at *71-72. 1605 273 Va. 350, 641 S.E.2d 472 (Va. 2007). 1606 D. Stan Barnhill, âConstruction Law,â 43 U. Rich. L. Rev. 107 (2008). 1607 Id. at 116 (footnote omitted). 1608 Id.
330 [the HRSD] harmless from any claims brought against it as a result of the contractorâs performance of the work.â1609 After one of the contractorâs employees was injured by a train, and the employee brought an action suit against Belt Line, the HRSD âhonored its indemnity obligation.â1610 The contractor refused the HRSDâs later demand that the contractor honor its indemnity obligation. The HRSD brought an action for a declaratory judgment to determine whether the indemnity provisions were enforceable.1611 As explained in the article, â[t]he contractor argued that the obligation to indemnify a party for personal injury arising out of negligence not caused by the indemnifying contractor or the party to be indemnified was against public policy.â1612 However, the Supreme Court of Virginia held that an owner may âobtain broad indemnity from a contractor to protect it from future personal injury claims that were not caused by its negligence or the negligence of the indemnifying contractor.â1613 1609 Id. (footnote omitted). 1610 Id. (footnote omitted). 1611 Id. (footnote omitted). 1612 Id. (footnote omitted). 1613 Id. at 117 (footnote omitted).
331 XIII. CONTRACTS AND RAILROADS A. Introduction The three sections in this part discuss implied covenants, indemnity provisions, and other agreements. Section B considers implied covenants principally in leases for maintaining and using a railroad, as well as implied covenants in mortgages on railroad property. Section C considers indemnity provisions, as well as related statutory provisions, and cases that hold that an obligation to indemnify is contractual in nature rather than being based on the common law and that a railroadâs passive negligence does not negate a contractual indemnity made for its benefit. Section C also summarizes articles that discuss the limited liability of freight lines when a passenger carrier uses a freight lineâs tracks or when a railroad is acting as a landlord. Section D discusses statutes regulating labor agreements, cases interpreting easements, limitations on the statesâ use of condemnation to avoid leasing railroad property, and limitations on the mandating of joint use or switching agreements. Finally, section D also summarizes articles on the STBâs deregulation of employee protections in sales agreements and its regulation of joint use agreements between freight and passenger rail lines. B. Implied Covenants in Railroad Contracts Statutes 1. Necessary Incidents Implied in a Contract An Oklahoma statute mandates that anything considered necessary for the parties to carry out a contract is an implied condition of the contract, a provision that has been applied to contracts that grant a right of way.1614 In one case involving a contract for a railroad right of 1614 5 OK Stat. § 15-172 (2014).
332 way, a state court ruled that the contract would be void if the railroad company were no longer operating.1615 Cases 2. Railroadâs Obligation to Maintain and Operate a Railroad while under Lease In Southern Railway Co. v. Franklin & Pittsylvania Railroad Co.1616 the Supreme Court of Appeals of Virginia held that the obligation to continue to operate a railroad on leased property was an implied covenant in the lease.1617 Franklin & Pittsylvania sought an injunction to prevent the Southern Railway Company (Southern Railway) from abandoning a railway.1618 The lease was drawn so that the lessee would operate the road and not abandon it.1619 Thus, the court held that there was an implied obligation to continue to operate the line for the period of the lease, as well as an implied prohibition on abandonment.1620 3. Lessor of Rail Property does not have a Common Law Duty to Repair the Property However, the Sixth Circuit in Felton v. Cincinnati1621 refused to find that there was an implied covenant in a lease that obligated the lessor to construct or repair a road to make it 1615 Kan., Okla. & Gulf Ry. Co. v. Grand Lake Grain Co., 1967 OK 170, 434 P.2d 153 (Okla. 1967). 1616 96 Va. 693, 32 S.E. 485 (1899). 1617 Id., 96 Va. at 709, 693, 32 S.E. at 491. 1618 Id., 96 Va. at 699, 693, 32 S.E. at 487. 1619 Id., 96 Va. at 699, 700, 708, 32 S.E. at 487, 490. 1620 Id., 96 Va. at 696, 693, 32 S.E. at 486. 1621 95 F. 336 (6th Cir. 1899).
333 suitable for its intended use.1622 The city of Cincinnati leased property to the Cincinnati, New Orleans, & Texas Pacific Railway Company (CNO&TP) to operate a rail line.1623 Because the bridges for the existing track were no longer operable, CNO&TP claimed that the city should repair the track to put it in a condition suitable for use as a railroad.1624 However, the court held that the city as the lessor was not obligated under the lease to repair the bridges.1625 Thus, unless otherwise required by the terms of the lease or required by statute, a lessor is not obligated to put property in an operable condition when leasing it to a railroad.1626 4. Prioritization of Income to Pay Expenses Incurred During Ordinary Operation over a Mortgage In re Chicago, R.I. & R. Ry. Co.1627 is a leading case on mortgages, railroad operations, and an implied priority on railroad income for the payment of operating expenses. The railroad faced several claims for damages to property and personal injury for which the Seventh Circuit ruled that the railroad had to compensate the claimants.1628 The claimants argued that the payment of damages to them should be classified as operating expenses, thus giving the payment 1622 Id. at 340. 1623 Id. at 337. 1624 Id. 1625 Id. at 343. 1626 Id. See, e.g., Smithfield Improvement Co. v. Coley-Bardin, 156 N.C. 255, 72 S.E. 312 (1911). 1627 90 F.2d 312, 315 (7th Cir. 1937), cert. denied, 302 U.S. 717, 58 S. Ct. 37, 82 L. Ed. 554 (1937). 1628 Id. at 314.
334 priority over mortgage payments.1629 The mortgagee argued that the railroad first had to meet its obligations under the mortgage before paying other indebtedness. The court held that it has long been established that mortgages upon railroad properties are subject to certain implied conditions. Every railroad mortgagee, in accepting its security, impliedly agrees that all current debts, accruing in the ordinary course of the operation of its business, shall be paid from the current income before [the mortgagee] has [a] claim thereto.1630 5. Implied Obligation in Railroad Contracts of Good Faith and Fair Dealing In Anderson v. Union Pac. R. Co.1631 an employee of Union Pacific alleged that the company had committed a breach of an implied covenant of good faith and fair dealing when the railroad terminated his employment. The Ninth Circuit held that the railroad had good cause to terminate Randal who had made inappropriate remarks regarding another coworker, attempted to influence individuals during the railroadâs investigation of the incident, and made other inappropriate remarks to coworkers.1632 The court relied on California law to define âgood causeâ as âa reasoned conclusion ⦠supported by substantial evidence.â1633 The court held that Union Pacificâs actions satisfied the definition of good cause under California law; therefore, the railroad did not commit a violation of an obligation of implied good faith and fair dealing.1634 1629 Id. 1630 Id. at 315 (citation omitted). 1631 359 Fed. Appx. 800 (9th Cir. 2009). 1632 Id. at 801. 1633 Id. (citing Cotran v. Rollins Hudig Hall Intâl, Inc., 948 P.2d 412, 422 (1998)). 1634 Id. at 801-802.
335 C. Indemnity Provisions in Railroad Contracts other than Construction Contracts Cases 1. Obligation to Indemnify a Railroad is Contractual In a case decided by the Eighth Circuit, the court held that an obligation to indemnify a railroad arises by virtue of a contract, not the common law.1635 In Rice v. Union Pacific R. Co.1636 Gunderson Rail Services (Gunderson) and Union Pacific had a Track Lease Agreement (TLA) pursuant to which Gunderson leased track within its railyard to Union Pacific. After a Union Pacific employee was injured in Gundersonâs railyard, Union Pacific brought an action against Gunderson for full indemnity.1637 The principal issue was whether Gunderson was liable under the terms of its TLA with Union Pacific.1638 The Eighth Circuit held that the âindustryâs obligation to indemnify a railroad ⦠is a contractual duty and not a duty arising under the common law.â1639 The indemnity provision included a clause that required Gunderson and Union Pacific to share equally in the cost of concurring acts of negligence.1640 The Eighth Circuit, therefore, upheld the district courtâs decision that Union Pacific and Gunderson were 1635 Rice v. Union Pacific R. Co., 712 F.3d 1214 (8th Cir. 2013). 1636 Id. at 1217. 1637 Id. at 1216. 1638 Id. at 1220-1221. 1639 Id. at 1219 (citing Burlington N., Inc. v. Bellaire Corp., 921 F.2d 760, 763 (8th Cir. 1990)). 1640 Id. at 1217.
336 each liable for half of the settlement with the employee and that Gunderson was not liable for Union Pacificâs part.1641 2. Indemnity Provision not Negated by Partyâs Passive or Secondary Negligence In Booth-Kelly Lumber Co. v. S. Pac. Co.1642 Southern Pacific brought an action against Booth-Kelly Lumber Company (Booth-Kelly) to recover sums that Southern Pacific had paid to settle a judgment in an action against it by Mack Powers. Southern Pacific alleged that Booth- Kelly was obliged to indemnify Southern Pacific for the full amount of the judgment. Booth- Kelly and Southern Pacific had an agreement whereby the railroad maintained a spur track and allowed Booth-Kelly to use it.1643 A provision in the agreement provided that Booth-Kelly would indemnify and hold harmless [Southern Pacific] for loss, damage, injury or death from any act or omission of [Booth-Kelly], its employees or agents, to the person or property of the parties hereto and their employees, and to the person or property of any other person or corporation, while on or about said trackâ¦.1644 The indemnity provision further provided that âif any claim or liability, other than from fire, shall arise from the joint or concurring negligence of both parties hereto, it shall be borne by them equally.â1645 Southern Pacific argued that it was entitled to full indemnity because of Booth-Kellyâs âactive negligenceâ in leaving a wood cart forty-two inches from the track that caused the 1641 Id. at 1216. 1642 183 F.2d 902, 904 (9th Cir. 1950). See Burlington Northern R. Co. v. Farmers Union Oil Co., 207 F.3d 526 (8th Cir. 2000) (ruling that a failure to warn a railroad of defective brakes was an act on the part of the lessee that triggered an indemnity provision in favor of the railroad). 1643 Booth-Kelly Lumber Co. v. S. Pac. Co., 183 F.2d at 905. 1644 Id. 1645 Id.
337 accident.1646 Southern Pacific argued that it was only passively negligent for failing to warn its brakeman of the presence of the cart.1647 The court held that the indemnity provision assumes that there was some negligence on the part of Southern Pacific; however, because Southern Pacific was only passively negligent while the Booth-Kelly was actively negligent, Southern Pacific was entitled to a full indemnity under the provision.1648 Articles 3. Freight Rail has Limited Liability for Passenger Rail Incidents A law review article discusses the issue of indemnification of freight rail lines when a passenger rail line, including mass transit lines, is granted a right of way on its lines.1649 When a freight railroad and Amtrak enter into an agreement granting Amtrak a right of way on freight lines, the freight railroad is indemnified from liability for incidents arising out of the use of the railroad by Amtrak for its passengers.1650 In National R.R. Passenger Corp. v. Consolidated Rail Corp.,1651 Consolidated Railroad Corporationâs (Conrail) freight train collided with an Amtrak 1646 Id. at 911. 1647 Id. 1648 Id. 1649 Justin J. Marks, âNo Free Ride: Limiting Freight Railroad Liability When Granting Right-of-Way to Passenger Rail Carriers,â 36 Transp. L.J. 313 (2009), hereinafter referred to as âMarks.â 1650 Id. at 316 and N 27. The author states that [t]o protect the freight railroad from liability, Amtrak contractually indemnifies through a no fault liability agreement for injuries âresulting from any damages that occur to Amtrak passengers, equipment, or employees regardless of fault if an Amtrak train is involved.â Id. at 316 (quoting United States Government Accountability Office, Intercity Passenger Rail: National Policy and Strategies Needed to Maximize Public Benefits from Federal Expenditures 148 (2006)). 1651 892 F.2d 1066 (D.C. Cir. 1990).
338 train, resulting in the deaths of and injuries to some passengers.1652 The employees, who recently had used marijuana, were operating the train at a high speed with a broken cab signal.1653 The trial court âdetermined that âpublic policy will not allow enforcement of indemnification provisions that appear to cover such extreme misconduct because serious and significant disincentives to railroad safety would ensue.ââ1654 However, the District of Columbia Circuit reversed the district court without reaching the âpublic policy ⦠or ⦠substantive issues of contract interpretationâ¦.â1655 Rather the appellate court reversed the district court because it âshould have compelled arbitration as provided in the Operating Agreement between the partiesâ¦.â1656 In discussing the above 1990 case, the Marksâ article observes, first, that âthe potential that future courts may weaken indemnity provisions in rail sharing contracts motivated congressional action to reinforce indemnification agreements;â that â[t]he 1997 Amtrak reauthorization legislation included a $200 million liability cap for all rail passengers;â and that the legislation âreinforced that â[a] provider of rail passenger transportation may enter into contracts that allocate financial responsibility for claims.ââ1657 1652 Id. at 1067. 1653 Id. 1654 Id. (citation omitted). 1655 Id. 1656 Id. 1657 Marks, supra note 1649, at 317 (quoting 49 U.S.C. §§ 28103 (a)(2) and (b) (1996)).
339 Second, the article argues that the âlegislation will help inner-city transit agencies enforce indemnity agreements with owners of rights-of-wayâ and that that â[a]lthough the liability cap has not been tested, courts have upheld transit agencies[â] indemnity agreements.â1658 4. Indemnity Provisions and the Role of State Legislatures The Marksâ article, supra, part XIII.C.3, also discusses the role of state legislatures with respect to right of way and indemnity provisions.1659 The article notes that â[f]orty-one passenger rail agencies operating in the United States (exclusive of Amtrak) share property with freight railroads, ⦠[that] include commuter rail agenciesâ¦; however, some transit agencies lack the authority to grant indemnification and therefore must get State Legislative approval.â1660 The article explains that although passenger rail and freight lines negotiate rights-of-way, state legislatures are often involved in setting the terms of indemnity agreements,1661 which range from the coverage of negligent acts to coverage of negligent and willful and wanton acts.1662 For example, a Colorado statute provides for an indemnity of freight railroads, including for âoutrageous conduct,â when public passenger railroads use their tracks. A railroad operating in interstate commerce that sells to a public entity, or allows the public entity to use, such railroadâs property or tracks for the provision of public passenger rail service shall not be liable either directly or by indemnification for punitive or exemplary damages or for damages for outrageous conduct to any person for any accident or injury arising out of the operation and maintenance of the public passenger rail service by a public entity.1663 1658 Id. at 318 N 41 (citations omitted). 1659 Id. at 323 (citing Colo. Rev. Stat. § 24-10-114 (2007); id. at 324 (citing Minn. Stat. § 174.82 (West 2006) and Va. Code Ann. § 56-446.1 (West 2006)). 1660 Marks, supra note 1649, at 321. 1661 Id. 1662 Id. at 327.
340 Some states have refused to accede to freight railsâ demands for no-fault liability indemnification.1664 Both Florida and Massachusetts wanted to use CSX freight lines for passenger rail service, but CSX demanded no-fault indemnification provisions from the states.1665 Some state legislation allows for freight and commuter rail services to enter into contracts that include indemnity provisions but that do not prescribe the limits of indemnification.1666 Both Minnesota and Virginia have statutes on indemnification in freight and passenger rail agreements without specifying the terms.1667 5. Whether it is against the Public Interest to Release or Indemnify a Railroad Company Acting as a Landlord As discussed in a law review article, when a railroad company is a landlord, the company may include an exculpatory provision in a lease that releases the railroad from any liability for damage to the lesseeâs property or a provision for indemnification of the railroad company.1668 In Griswold v. Illinois Central Railroad1669 an indemnity provision stated that the lessee, in consideration of the premises, hereby covenants and agrees with the lessor, its successors and assigns, to pay the said lessor, as rent for said premises, the sum of one dollar, to be paid at the time and in the manner following, to wit, on the delivery of this lease; and the lessee further covenants and agrees with the lessor that he will, from the date of this indenture, put to use and maintain a good, 1663 Id. at 323 (citing Colo. Rev. Stat. § 24-10-114 (4)(b) (2007)). 1664 Marks, supra note 1649, at 323-324. 1665 Id. 1666 Id. at 324. 1667 Id. at 324 (citing Minn. Stat. § 174.82 (West 2006); Va. Code Ann. § 56-446.1 (West 2006)). 1668 William K. Jones, âPrivate Revision of Public Standards: Exculpatory Agreements in Leases,â 63 N.Y.U. L. Rev. 717 (1988), hereinafter referred to as âJones.â 1669 57 N.W. 843 (Iowa 1984) (internal quotation marks omitted).
341 substantial elevator, coal sheds, and lumber yard on the above described premises; and further agrees to protect and save harmless said lessor from all liability for damage by fire, which, in the operation of the lessorâs railroad, or from cars or engines lawfully on its tracks, may accidentally or negligently be communicated to any property or structure on said described premises.1670 Notwithstanding a state statute that imposed liability on railroads for fires arising out of railroad operations, the court enforced an indemnity provision in a lease agreement between the railroad and the claimant who lost property in a fire.1671 In Stephens v. Southern Pacific Co.1672 the court also upheld an indemnity provision that was triggered by a fire caused by the railroad.1673 The court held that there was no public policy interest at stake in upholding the indemnity provisions in such a lease.1674 The law review article argues that allowing railroads as lessors to contract for indemnity is economically efficient and, therefore, should not be against public policy.1675 D. Other Contracts and Obligations Applicable to Railroads Statutes 1. STBâs Authority to Mandate Construction of Switch Connections In addition to other matters, the ICCTA regulates fair wages for employees, public health and safety, and competition in the railroad industry.1676 Under the statute â[a] person may 1670 Id., 90 Iowa at 267, 57 N.W. at 844 (internal quotation marks omitted). 1671 Jones, supra note 1668, at 720. 1672 109 Cal. 86, 41 P. 783 (1895). 1673 Jones, supra note 1668, at 724. 1674 Id. 1675 Id. at 749-750.
342 construct an extension to any of its railroad lines [or] construct an additional railroad line ⦠only if the Board issues a certificate authorizing such activity.â1677 The STB now is authorized to mandate the construction of switch connections when an owner of a railroad applies to the Board for the connection.1678 The authority of the STB has been confirmed in a number of cases.1679 Cases 2. No Right to use a Track after the Expiration of an Easement In Dakota, Minnesota & Eastern Railroad Corp. v. Wisconsin & Southern Railroad Corp.1680 Wisconsin & Southern purchased the âJanesville rail lines,â including a spur that served Dakota, Minnesota & Eastern Railroad Corp.âs (DM&E) principal customer Freedom Plastics, Inc. (Freedom Plastics). The contract allowed DM&E to continue to operate trains on the Janesville lines being sold to Wisconsin & Southern and granted DM&E an exclusive easement to use a spur to serve Freedom Plastics.1681 After Freedom Plastics went into receivership and was later sold, Wisconsin & Southern, the owner of the property, assumed the use of the spur track.1682 DM&E brought an action claiming that it had sold the land under the track but not the track itself.1683 1676 49 U.S.C. §§ 10101(1) and (11) (2014). 1677 49 U.S.C. § 10901(a) (2014). 1678 49 U.S.C. § 11103(b) (2014). 1679 See, e.g., Bhd. of R.R. Signalmen v. Surface Transp. Bd., 638 F.3d 807 (D.C. Cir. 2011) (upholding STBâs interpretation of a ârailroad lineâ as the right to operate as a common carrier and affirming the STBâs authority to review, as an acquisition of a railroad line, the Massachusetts Department of Transportationâs purchase of track and assets from CSX Transportation). 1680 657 F.3d 615 (7th Cir. 2011). 1681 Id. at 617.
343 The Seventh Circuit held that DM&E, after it sold the property to Wisconsin & Southern, did not retain any right to use the track when the easement to serve Freedom Plastics no longer applied. Furthermore, DM&E did not retain a property interest in the rails.1684 The court held that the rails on a railroadâs right of way are fixtures, ⦠and fixtures are part of the real property to which they are attached. Anyone contemplating the purchase of the right of way would therefore justifiably assume in the absence of a contrary statement in the deed that the rails were being sold along with the right of way conveyed by the deed.1685 Thus, the court rejected DM&Eâs interpretation of the easement, held that the tracks were sold as a fixture with the land, and affirmed the district courtâs grant of a summary judgment for Wisconsin & Southern.1686 3. Unlawful Condemnation of Leased Railroad Property to Avoid a Lease In Union Pac. R. Co. v. Chicago Transit Auth.1687 the Chicago Transit Authority (CTA) attempted to condemn leased railroad property and retain a permanent easement to avoid paying high rents to the railroad as lessor. The CTA claimed that the use of the railroad would be the same under an easement as it would be under a lease and that, therefore, the use did not constitute interference.1688 The Seventh Circuit held that the use of a railroad pursuant to an 1682 Id. 1683 Id. at 621. 1684 Id. at 622. 1685 Id. 1686 Id. 1687 647 F.3d 675, 683 (7th Cir. 2011). 1688 Id. at 681.
344 easement was not guaranteed to be the same as under a lease and that Union Pacific would lose property rights if its property were condemned.1689 The court further held that the condemnation amounted to regulation that interfered with railroad transportation and, thus, was preempted by the ICCTA.1690 The CTA could enter into a new lease, but it could not obtain a favorable arrangement for itself through condemnation.1691 4. STBâs Review of Proposed Switching and Joint Use Agreements Limited by a Showing of Public Interest or Encouragement of Competition In Central States Enterprises, Inc. v. I.C.C.1692 Central States Enterprises, Inc. (Central), a grain elevator operator, requested the ICC to require two railroad companies to enter into a switching agreement or, alternatively, a joint use agreement. By statute âthe Commission âmayâ order relief in the form of a joint use or switching agreement where it is âpracticable and in the public interest.ââ1693 Central made the request based on the location of its grain elevators and having to use two railroad companies, transferring grain from one train to another, when shipping grain between elevators.1694 Under either of the agreements, Central would not have to change trains.1695 The STB now has jurisdiction to review agreements on acquisitions and 1689 Id. at 683. 1690 Id. at 682. 1691 Id. at 683. 1692 780 F.2d 664, 667-668 (7th Cir. 1985). 1693 Id. at 668 (quoting 49 U.S.C. §§ 11103(a) and (c)(1)(1985)). 1694 Id. at 667-668. 1695 Id.
345 mergers of railroads, as well as agreements concerning trackage rights or joint use.1696 In reviewing proposed agreements the STB must consider the public interest and the effect on competition among railroads.1697 The Seventh Circuit upheld the Commissionâs finding that there had not been a showing of a compelling public need for joint terminal service; held that the Commission acted within its discretion in assessing what was in the public interest, and upheld the Commissionâs conclusion that the switching agreement was sought merely as a matter of convenience.1698 5. Construction of a Spur Track over a Pipeline on an Easement In Travis County v. Flint Hills Res., L.P.1699 Flint Hills Resources, L.P. (Flint Hills), which had an easement on property belonging to Travis County, built a pipeline on the property pursuant to the easement. The county later agreed to sell the property to Balcones Resources (Balcones) on which Balcones intended to build a spur track over the pipeline.1700 Flint Hills argued that under the terms of the easement Balcones could not build the track over the pipeline but Flint Hills would allow the spur track if Balcones paid the expense of lowering the pipeline by several feet.1701 Because the dispute over the spur track delayed the sale of the land, the county brought an action for a declaratory judgment that the easement gave the county a right to 1696 49 U.S.C. § 11323(a) (2014). 1697 49 U.S.C. §§ 11324(b), (c), and (d) (2014). 1698 Central States Enterprises, Inc., 789 F.2d at 678-680. 1699 456 Fed. Appx. 410 (5th Cir. 2011). 1700 Id. at 412. 1701 Id.
346 build a spur track across the easement.1702 Although the district court held the county had the right to build a spur track on the land, the Fifth Circuit reversed and remanded the case.1703 The Fifth Circuit held that under Texas law the rules on the interpretation of contracts also apply to easements.1704 However, because the easement was silent on which party should pay to lower the pipeline if a spur track were built across it, the court held that the Texas Health and Safety Code governed.1705 The court further held that Balcones was a âconstructorâ within the meaning of the statute and that [t]he County or its grantee may not proceed to build the railroad spur until âthe constructor pays the reasonable, necessary, and documented cost of the additional fortifications, barriers, conduits, or other changes or improvements necessary to protect the public or pipeline facility from that risk before proceeding with the construction.â1706 Articles 6. Short Line Sales and Employee Protection Provisions A law review article on the rise in recent years of short line railroads in the United States, but prior to the establishment of the STB, discusses the ICCâs more permissive approach in the regulation of the railroadsâ obligations to employees and in the regulation of protections for employees in sales agreements.1707 In 1985, the ICC promulgated new regulations to exempt parties to sales of short line railroads from the obligation to pay former employees of the railroad 1702 Id. 1703 Id. 1704 Id. at 413. 1705 Id. (citing Tex. Health & Safety Code Ann. § 756.122 (2005)). 1706 Id. at 415 (quoting Tex. Health & Safety Code Ann. §§ 756.121 and 756.123(2) (West 2005)). 1707 Paul Stephen Dempsey and William G. Mahoney, âThe U.S. Short Line Railroad Phenomenon: The Other Side of the Tracks,â 24 U. Tol. L. Rev. 425, 428-430 (1993).
347 after the sale or to employ displaced workers.1708 According to the article, when there were existing contractual protections for employees, deregulation has resulted in the voiding of such contractual arrangements for employees.1709 7. Shifting Bargaining Power between Passenger Rail Lines and Freight Rail Lines through STB Regulation As an article in the Transportation Law Journal explains, when it is in the public interest the STB may require the use of track facilities of one carrier for another carrier.1710 Although the parties are to negotiate the terms, the Board may establish the necessary conditions when the parties are unable to do so.1711 Commuter agencies may take advantage of the Boardâs power to establish conditions when negotiating for the use of freight lines.1712 As for the property that the STB may require to be used, [t]he property must be either a âterminal facilityâ or âmain line track for a reasonable distance outside a terminal[,]â and these must be owned by a ârail carrier providing transportation subject to the jurisdiction of the Board under this part.â1713 1708 Id. at 429. 1709 Id. at 435. The authors state, for example, that â[e]mployees have ⦠been adversely affected by unregulated short line sales and leases which were specifically designed to nullify union contracts.â Id. at 436. But see Bhd. of Maint. of Way Employees Div. v. Burlington N. Santa Fe Ry. Co., 596 F.3d 1217 (10th Cir. 2010) (ruling that a workerâs dispute over the sale of a railway to the New Mexico Department of Transportation was subject to mandatory arbitration by the National Railroad Adjustment Board under the Railway Labor Act). 1710 Charles A. Spitulnik and Jamie Palter Rennert, âUse of Freight Rail Lines for Commuter Operations: Public Interest, Private Property,â 26 Transp. L.J. 319, 329 (1999). 1711 Id. 1712 Id. 1713 Id. at 330 (footnote omitted).
348 Furthermore, âa terminal facility is âany property of a carrier which assists in the performance of the functions of a terminal,ââ but âthe nature of the facilities and the area in which they are located are as important as the use, ⦠such as ⦠service [that] is performed within a cohesive commercial areaâ¦.â1714 Although a freight line will be compensated for the use of its track, freight lines may assert lack of capacity to avoid a forced agreement.1715 1714 Id. (footnote omitted). 1715 Id. at 337-338.
349 XIV. CROSSINGS AT RAILROADS A. Introduction This part of the Report is devoted to several aspects of the important topic of highway- railway grade crossings. Section B discusses federal and state law on improvements to or the elimination of highway-railway grade-crossings, as well as the governmentâs right to require changes to highway-railway grade crossings in the public interest. Section C discusses defective conditions at railroad crossings, such as inadequate warnings, uneven road and rail conditions, and vegetation obstructing a motoristâs view of an oncoming train. Conditions of crossings and warning signs are often regulated by statute. Section D discusses a motoristâs obligation to make a full stop at a railroad crossing in response to warning signals or a stop sign that may indicate an approaching train. Although a trainâs crew may assume that a driver will obey traffic laws and stop, both the crew and the motorist have a duty to exercise caution when approaching a crossing. Section E addresses the liability of railroads for accidents at railroad crossings, the Federal Railroad Safety Actâs (FRSA) preemption of some state tort claims, and a railroadâs duty to inspect a railway for defects, as well as to maintain a toll-free telephone service for persons to report malfunctions and other problems at crossings. Section F discusses state laws on the rights of utilities to use or cross certain railroad rights of way. Section G considers the issue of compensation for damage occasioned by the construction, relocation, or closure of crossings. Section H discusses liability of railroads for injuries at private crossings.
350 B. Improvements to or Elimination of Highway-Railway Grade Crossings Statutes 1. Federal Highway-Railway Crossings Program As provided in 23 U.S.C. § 130(a), the Department of Transportation pays for the cost âof construction of projects for the elimination of hazards of railway-highway crossings, including the separation or protection of grades at crossings, the reconstruction of existing railroad grade crossing structures, and the relocation of highways to eliminate grade crossingsâ¦.â Under subsection (b) of § 130, the Secretary classifies âthe various types of projects involved in the elimination of hazards of railway-highway crossingsâ as a way of establishing for each classification a percentage of the construction that âshall be deemed to represent the net benefit to the railroad or railroads for the purpose of determining the railroadâs share of the cost of construction,â not to exceed 10 percent.1716 When a railroad that is involved in a project to eliminate hazards at railway-highway crossings is paid as provided in the statute, the railroad is âliable to the United States for the net benefit to the railroad determined under the classification of such project made pursuant to subsection (b) of this sectionâ as further provided in subsection (c).1717 1716 23 U.S.C. § 130(b) (2014). 1717 23 U.S.C. § 130(c) (2014).
351 Each state is required to âconduct and systematically maintain a survey of all highways to identify those railroad crossings which may require separation, relocation, or protective devices, and establish and implement a schedule of projects for this purpose.â1718 Each state must report annually to the Secretary âon the progress being made to implement the railway-highway crossings program authorized by this section and the effectiveness of such improvements.â1719 Moreover, the Secretary must submit a report to Congress every two years on the statesâ progress âin implementing projects to improve railway- highway crossings.â1720 Article 2. Railroad Obligations under State Law on Grade Crossings As discussed in subpart B.5 below, except when federal law preempts state law, â[m]ost aspects of jurisdiction over highway-rail grade crossings reside with the states.â1721 A Mississippi statute is an example of a railroadâs obligations on crossings and needed improvements. The statute requires that when a railroad is constructed across a highway such that the highway must be raised or lowered, the railroad company is responsible to make and maintain a âproper and easyâ grade for the crossing.1722 1718 23 U.S.C. § 130(d) (2014). 1719 23 C.F.R. § 123(g) (2014). 1720 Id. 1721 L. Stephen Jennings, âThe Compilation of State Laws and Regulations Affecting Highway-Rail Grade Crossings,â at ii (5th Ed. 2009), available at: http://www.plsc.net/docs/compilationofstatelawsRR2009.pdf (last accessed March 31, 2015). 1722 Miss. Code Ann. § 77-9-251 (2014).
352 Cases 3. Compensation when a Local Government and a Railroad Company Agree on a Change of Grade In Bercel Garages, Inc. v. Macomb County Road Commân1723 the plaintiffs owned stores adjacent to a crossing where the county decided to construct an overpass to alleviate congestion caused by an existing crossing.1724 In Michigan, even if a change of grade is not a taking requiring compensation, a state statute provides that affected property owners may recover compensation from the local government.1725 After the construction, because the plaintiffsâ properties were less accessible from the highway, the plaintiffs sought damages from the county under the applicable statute.1726 Although the statutory provisions relevant to the agreements for separation of grade and compensation for third parties were repealed later, Michigan still recognizes the ability of a road authority and a railroad to enter into agreements for a change of grade, including separation of a grade at crossings, and the responsibility to compensate adjacent landowners.1727 1723 190 Mich. App. 73, 475 N.W.2d 840 (Mich. Ct. App. 1991). 1724 Id., 190 Mich. App. at 76, 475 N.W.2d at 842. 1725 Id., 190 Mich. App. at 81-82, 475 N.W.2d at 845. 1726 Id., 190 Mich. App. at 76-77, 475 N.W.2d at 842-843. 1727 Mich. Comp. Laws §§ 102.7, 462.321 (2014).
353 Articles 4. Elimination or Modification of Railroad Crossings A law review article on access to the Hudson River in New York discusses the construction or elimination of railroad grade crossings.1728 As early as 1906, it was the policy of the state of New York to close grade crossings when possible.1729 The Commissioner of Transportation may approve the installation, elimination, or relocation of grade crossings.1730 In 1994, the Commissionerâs authority was extended to private crossings.1731 The city and state assume the expense when the Commissioner decides that it is in the public interest to change a grade.1732 Otherwise, the railroad assumes half of the expense with the city and state dividing the remaining cost.1733 5. Compilation of State Laws and Regulations on Matters Affecting Highway- Rail Crossings A compilation of state laws and regulations on matters affecting highway-rail crossings prepared in conjunction with the Federal Railroad Administration includes a chapter on âcrossing treatment procedures.â1734 The compilation summarizes the law in each state on the processes 1728 Matthew R. Atkinson, âOn the Wrong Side of the Railroad Tracks: Public Access to the Hudson River,â 13 Pace Envtl. L. Rev. 747, 800-805 (1996). 1729 Id. at 800. 1730 Id. at 801. 1731 Id. 1732 Id. at 803 (citing N.Y. R.R. Law § 91). 1733 Id. at 803-804. 1734 L. Stephen Jennings, âThe Compilation of State Laws and Regulations Affecting Highway-Rail Grade
354 and procedures required and the roles of the state or local government and the railroads âwhen undertaking elimination, relocation, construction, repair, and/or improvement of grade crossings.â As the report notes, [t]he designated agency having authority to order improvements is also the one with statutory authority to order outright elimination. But, there exists a distinction in some states in that an agency may have the authority to eliminate a highway-rail grade crossing, but only for the purposes of creating a grade separation.1735 The applicable sections of the statutes are included with each state. In most of the entries, a discussion of the division of the costs for elimination, relocation, construction, repair, and/or improvements of grade crossings is included. C. Defective Conditions at Railroad Crossings Statutes and Regulations 1. Safety Standards for Railroad Tracks, Roadbeds, and Nearby Areas Federal regulations require railroad track, roadbed, and the areas around the roadbed to meet certain safety standards. Part 213 of title 49 of the C.F.R. prescribes minimum safety requirements for railroad track that is part of the general railroad system of transportation. ⦠[A] combination of track conditions, none of which individually amounts to a deviation from the requirements in this part, may require remedial action to provide for safe operations over that track. This part does not restrict a railroad from adopting and enforcing additional or more stringent requirements not inconsistent with this part.1736 Section 213.31 âprescribes minimum requirements for roadbed and areas immediately adjacent to roadbed.â Drainage facilities under and adjacent to the roadbed must be âmaintained Crossings,â 5th Ed. (2009), available at: http://www.plsc.net/docs/compilationofstatelawsRR2009.pdf (last accessed March 31, 2015). 1735 Id. at ch. 2-1. 1736 49 C.F.R. § 213.1 (2014).
355 and kept free of obstruction, to accommodate [the] expected water flow for the areaâ¦.â1737 The roadbed drainage system must be maintained and be unobstructed.1738 Vegetation must be controlled so that it is not a hazard or otherwise obstructing warning signs, including signs at railroad crossings. Track owners must maintain track surfaces in accordance within the limits prescribed by the section.1739 Under § 213.113(a) that applies to defective rails, [w]hen an owner of track to which this part applies learns, through inspection or otherwise, that a rail in that track contains any of the defects listed in the following table, a person designated under § 213.7 shall determine whether or not the track may continue in use. Furthermore, [i]f he determines that the track may continue in use, operation over the defective rail is not permitted untilâ (1) The rail is replaced; or (2) The remedial action prescribed in the table is initiated.1740 Depending on the class of the track, inspections of the track must be conducted monthly, weekly, or biweekly at a pace that allows for a survey of the track structure.1741 2. Duty to Maintain a Crossing beyond the Crossties and the Crossing A Georgia statute requires railroads to maintain public crossings to permit âsafe and reasonable passage of public traffic.â1742 A railroad is responsible to maintain that part of the 1737 49 C.F.R. § 213.33 (2014). 1738 49 C.F.R. § 213.33 (2014). 1739 49 C.F.R. § 213.63 (2014). 1740 29 C.F.R. § 213(a)(1) and (2) (2014). 1741 49 C.F.R. § 213.233 (2014).
356 road extending two feet beyond the crossties.1743 A railroad is responsible for that part of the road four feet beyond the âtraveled way or flush with the edge of the paved shoulder.â1744 3. Applicability of the Manual on Uniform Traffic Control Devices to Railroad Crossings As discussed in part XXIX of the Report, the Manual on Uniform Traffic Control Devices (MUTCD) requires that certain devices must be used at highway and rail or light rail transit crossings.1745 When light rail transit and railroads use the same track, the standards for rail and highway crossings are to be used.1746 For example, at a light rail transit and highway crossing, the crossing must have traffic signals or flashing signal lights.1747 When an engineering study concludes that crossbucks, stop signs, or yield signs are required they may be used as well.1748 Crossing signals must be retroreflectorized so that the color of the sign is the same both day and night.1749 When there is a crossing in a temporary traffic control zone the signals should not cause vehicles to stop on the rail.1750 The MUTCDâs provisions cover the specific types of signs to use prior to a railroad crossing. 1742 Ga. Code Ann. § 32-6-190 (2014). 1743 Id. 1744 Id. 1745 FHWA, Manual on Uniform Traffic Control Devices 8A (2009), available at: http://mutcd.fhwa.dot.gov/pdfs/2009r1r2/part8.pdf (last accessed March 31, 2015), hereinafter referred to as âMUTCD.â 1746 Id. at § 8A.01. 1747 Id. at § 8A.03. 1748 Id. 1749 Id. at § 8A.04. 1750 Id. at § 8A.08.
357 Cases 4. Requirement of Notice of a Defective Condition at a Crossing to hold a Railroad Liable for the Condition In Goebel v. Salt Lake City S. R. Co.1751 the plaintiff was riding his bicycle across a railroad crossing when his bicycle allegedly was forced into a small gap in the roadway that caused his tire to jam against the rail. Goebel alleged that a gap had developed between the âfield panelsâ that raise the road almost to the same height as the rail.1752 After the trial court granted a directed verdict for the railroad, Goebel appealed. The plaintiff argued that the railroad had constructive notice of the gap in the road and that it was not necessary to prove notice because state law required a railroad to maintain crossings.1753 Because the alleged condition was not one that the railroad installed or created, the Supreme Court of Utah held that evidence of notice was required.1754 Moreover, because the railroad had inspected the crossing the plaintiff was unable to establish that the railroad had constructive notice. Finally, Goebel had biked through the crossing previously without observing the gap.1755 The court upheld the trial courtâs directed verdict in favor of the railroad.1756 Thus, a railroad must have notice of a defective condition at or in a crossing before it may be held liable for negligence for failing to maintain the crossing. 1751 104 P.3d 1185, 1189 (Utah 2004), affâd, Utah Transit Auth. v. Salt Lake City S. R.R. Co., Inc., 2006 UT App 46, 2006 Utah App. LEXIS 15 (2006). 1752 Id. 1753 Id. at 1189-1190. 1754 Id. at 1193. 1755 Id. at 1194. 1756 Id. at 1198.
358 5. Whether a Road Condition at a Crossing is an Unusually Dangerous Condition In Illinois Cent. Gulf R. Co. v. Travis1757 an oncoming train struck a motoristâs truck when the motorist failed to stop prior to a railroad crossing. Among other claims, Travis alleged that there were several defects in the crossing.1758 Whether a crossing is considered to be unusually dangerous depends on several factors, such as whether a motorist was able to see the approaching train; whether there was an unusually steep grade; whether a motorist was able to hear an approaching train; and whether there was unusual traffic congestion.1759 A railroadâs duties are to âmake proper and easy grades in the highwayâ and to make certain that grades are convenient and safe to cross by one exercising reasonable care.1760 However, railroads are not responsible for the condition of the road prior to a crossing.1761 The grade was not unusually steep and the crossing lacked other defects that would prevent one from seeing or hearing a train.1762 Thus, the railroad company was held not liable for the accident.1763 1757 106 So.3d 320, 324 (Miss. 2012), rehearing denied, 2013 Miss. LEXIS 93 (Miss., Feb. 14, 2013). 1758 Id. at 338. 1759 Id. 1760 Id. at 338, 339 (citing Miss. Code Ann. § 77-9-251 (Rev. 2009)). 1761 Id. at 339. 1762 Id. 1763 Id. at 340.
359 6. Applicability of a Statute to a Crossing that was Installed after the Roadâs Construction In Bowman v. CSX Transportation, Inc.1764 a CSX train struck Bowmanâs vehicle as she attempted to proceed around a car that stopped in front of her while Bowman was still in the crossing.1765 Bowman alleged that the CSX was negligent in maintaining the crossing, but the jury found in favor of CSX.1766 A Mississippi statute provided that when a railroad is constructed across a highway and it becomes necessary to raise or lower the highway, the railroadâs duty is âto make proper and easy grades in the highway, so that the railroad may be conveniently crossed.â1767 A Mississippi appellate court interpreted the statute to apply to railroad crossings that were installed after the construction of the road.1768 However, although the statute âforms a consistent pattern with other authorityâ that requires a railroad to maintain a crossing,1769 based on other evidence in the case the court upheld the juryâs verdict in favor of CSX.1770 1764 931 So.2d 644 (Miss. Ct. App. 2006). 1765 Id. at 648. 1766 Id. 1767 Id. at 652 (quoting Miss. Code Ann. § 77-9-251 (Rev. 2001)). 1768 Id. 1769 Id. 1770 Id. at 664-665.
360 Article 7. Maintaining a Crossing and Crossing Signs and Warning Devices As discussed in a law review article, Virginia law requires a railroad to keep a public crossing in good repair, including when a railroad changes the grade of the tracks.1771 A railroad must âmaintain a safe vertical relationship between trackage and street surfacesâ and crossbucks must be placed at every public railroad crossing.1772 However, federal funds may be used to upgrade warning signs to reflective signs or to automatic warning signals at crossings.1773 Under federal law the use of federal funds to upgrade crossings results in federal preemption of claims under state law alleging that railroad crossing warnings were inadequate.1774 A railroad may only âinstall or upgrade a public grade crossing pursuant to an agreement with the Virginia Department of Transportation.â1775 A railroad may not decide unilaterally to install a warning system at a crossing.1776 The article also discusses a railroadâs responsibility to control vegetation that may impair a motoristâs ability to see an oncoming train.1777 However, when vegetation is present motorists have an obligation to approach a track more carefully.1778 1771 Brent M. Timberlake, âRailroad Law,â 43 U. Rich. L. Rev. 337 (2008). 1772 Id. at 360 (citing Va. Code Ann. § 56-405.02 (Repl. Vol. 2007)). 1773 Id. at 361. 1774 Id. 1775 Id. at 361-362 (citing Va. Code Ann. § 56-406.1 (Repl. Vol. 2007)). 1776 Id. 1777 Id. at 365. 1778 Id.
361 Although there is Virginia law on a railroadâs obligation to sound a horn or bell when approaching a crossing, the FRAâs regulations preempt state law.1779 The FRAâs regulations require the use of locomotive horns at railroad crossings except in quiet zones.1780 However, under the standing train doctrine ââthere is no duty on the railway company to provide special warning or safeguards to motorists ⦠to prevent collisions with cars standing on or moving across a public grade crossing.ââ1781 D. Failure by Motorists to Stop at Railroad Crossings Statutes and Regulations 1. Full Stop Required at a Crossing when a Signal Indicates an Approaching Train A Vermont statute requires motorists to make a complete stop fifty feet from the nearest rail of a railroad crossing when an approaching train is visible; an approaching train has sounded its horn; a crossing gate is down; a signal warns of an approaching train; or a stop sign is posted.1782 A motorist still may cross the tracks when a warning signal is in operation as long as the motorist first comes to a complete stop and is able to cross the tracks safely.1783 1779 Id. at 368. 1780 Id. 1781 Id. at 368-369 (quoting Wojciechowski v. Louisville & N. R. Co., 277 Ala. 528, 173 So.2d 72 (Ala. 1964)). 1782 23 V.S.A. § 1071 (2014). 1783 23 V.S.A. § 1071(c) (2014).
362 Cases 2. Passengerâs Duty to Watch for Approaching Trains and Warn the Driver to Stop In Smith v. Union Pac. R. Co.1784 the plaintiff Smith was a passenger in a truck that collided with a Union Pacific train at a railroad crossing. Because of the plaintiffâs contributory negligence the trial court granted a summary judgment in favor of Union Pacific.1785 The issue on appeal was whether the passenger-plaintiff was contributorily negligent in failing to watch for and warn the driver of the approaching train.1786 The Supreme Court of Kansas stated that â[a] passenger may properly rely upon the driver to attend to the operation of the vehicle, in the absence of the knowledge of danger, or facts which would give him such knowledge.â1787 A passenger may rely on the driver until the passenger has reason not to do so.1788 If a passenger sees an approaching train and fails to warn the driver to stop, the passenger may be held to be contributorily negligent.1789 However, the court rejected the argument that a passenger is contributorily negligent as a matter of law when the passenger fails to watch for and warn the driver of an approaching train.1790 Thus, it is a question of fact whether the passenger did not use reasonable care.1791 1784 564 P.2d 514, 515 (Kan. 1977). 1785 Id. 1786 Id. at 515-516. 1787 Id. at 518. 1788 Id. at 519. 1789 Id. 1790 Id.
363 Having determined that the passenger was not contributorily negligent as a matter of law, the court remanded the case to determine whether based on the evidence the passenger was contributorily negligent.1792 3. Railroad Conductorâs Duty to Watch for Motorists who may Fail to Stop In Illinois Cent. Gulf R. Co. v. Travis,1793 supra, part XIV.C.5, the court held that Mississippi law requires that a crew on a moving train to watch for vehicles approaching the tracks but that the law also allows the crew to assume that motorists will obey the traffic laws. In Travis, the driver of a truck approaching the railroad tracks stopped prior to the tracks to allow a tractor to cross.1794 On seeing the tractor the conductor sounded the trainâs horn.1795 The driver of the truck continued to approach the tracks slowly while the train continued toward the crossing.1796 The conductor and engineer saw the truck stop for the tractor and then slowly approach the tracks, but they assumed that the truck would stop to allow the train to pass.1797 The train struck the front of the truck, killing the driver.1798 Because the crew kept an adequate 1791 Id. 1792 Id. at 520. 1793 106 So.3d 320, 329-330 (Miss. 2012), rehearing denied, 2013 Miss. LEXIS 93 (Miss., Feb. 14, 2013). 1794 Id. at 324. 1795 Id. 1796 Id. 1797 Id. at 330. 1798 Id. at 324.
364 lookout for oncoming traffic and properly assumed that the truck would stop, the railroad was not liable for the driverâs death.1799 E. Liability of Railroads for Defective Conditions at Crossings Statutes and Regulations 1. Telephone Reporting of Problems at Crossings Federal law requires each railroad carrier to (1) establish and maintain a toll-free telephone service for rights-of-way over which it dispatches trains, to directly receive calls reportingâ (A) malfunctions of signals, crossing gates, and other devices to promote safety at the grade crossing of railroad tracks on those rights-of-way and public or private roads; (B) disabled vehicles blocking railroad tracks at such grade crossings; (C) obstructions to the view of a pedestrian or a vehicle operator for a reasonable distance in either direction of a trainâs approach; or (D) other safety information involving such grade crossingsâ¦.1800 Furthermore, railroads must (5) ensure the placement at each grade crossing on rights-of-way that it owns of appropriately located signs, on which shall appear, at a minimumâ (A) a toll-free telephone number to be used for placing calls described in paragraph (1) to the railroad carrier dispatching trains on that right-of-way; (B) an explanation of the purpose of that toll-free telephone number; and (C) the grade crossing number assigned for that crossing by the National Highway-Rail Crossing.1801 1799 Id. at 330. 1800 49 U.S. Code § 20152(a)(1)(A)-(D) (2014) (emphasis supplied). 1801 49 U.S. Code § 20152(a)(5)(A)-(C) (2014) (emphasis supplied). The requirement for toll-free telephone service may be waived for Class II and Class III rail carriers when âthe Secretary determines that toll-free service would be cost prohibitive or unnecessary.â 49 U.S.C. § 20152(b) (2014).
365 Cases 2. Preemption of Claims under State Law Alleging Defective Warning Signs Federal law preempts state claims based on railroadsâ alleged failure to maintain adequate warning signs at railroad crossings.1802 For example, in Norfolk S. Ry. Co. v. Shanklin,1803 after Shanklinâs husband was killed in a collision with a Norfolk Southern train at a railroad crossing in Tennessee, the plaintiff alleged that Norfolk Southern failed to maintain adequate warning signs at the crossing. The warning signs consisted of advance warning signs and reflectorized crossbucks that had been installed with federal funds in 1987.1804 The Supreme Court reversed the Sixth Circuitâs holding that the FRSA did not preempt claims for inadequate warning signs under state law.1805 Rather, the Supreme Court held that the FRSA preempts state law when the FRSA âsubstantially subsumes the subject matter of the relevant state law.â1806 Federal regulations on the adequacy of warning devices at railroad crossings also apply when federal funds are used to install such devices and signs.1807 When a state has used federal funds to install devices at a crossing, if the devices prove to be inadequate it is no longer possible to hold the railroad liable 1802 Norfolk S. Ry. Co. v. Shanklin, 529 U.S. 344, 120 S. Ct. 1467, 146 L.Ed.2d 374 (2000). 1803 Id., 529 U.S. at 347, 120 S. Ct. 1467, 146 L.Ed.2d 374. 1804 Id., 529 U.S. at 350, 120 S. Ct. 1467, 146 L.Ed.2d 374. 1805 Id., 529 U.S. at 350-351, 359, 120 S. Ct. 1467, 146 L.Ed.2d 374. 1806 Id., 529 U.S. at 352, 120 S. Ct. 1467, 146 L.Ed.2d 374. 1807 Id., 529 U.S. at 353-354, 120 S. Ct. 1467, 146 L.Ed.2d 374 (citing 23 C.F.R. §§ 646.214(b)(3), (4) (2014)).
366 under state law.1808 Because Tennessee had used federal funding to install warning devices at the crossing, federal law preempted the plaintiffâs claims under state law for Norfolk Southernâs alleged failure to maintain adequate warning devices.1809 3. Two-Step Approach in Determining Whether Tort Claims under State Law are Preempted by the Federal Railroad Safety Act In Zimmerman v. Norfolk S. Corp.,1810 while approaching the railroad tracks, Zimmerman did not see an oncoming Norfolk Southern train until seventy-six feet from the crossing. When Zimmermanâs motorcycle malfunctioned as Zimmerman tried to brake, the plaintiff was thrown from his motorcycle and paralyzed as a result.1811 The plaintiff claimed against Norfolk Southern for its failure to warn, maintain a safe crossing, and comply with federal regulations on crossing devices.1812 The Third Circuit applied a two-step approach to determine whether the FRSA preempted any of the motoristâs claims.1813 Under the first step of the analysis, the court asked whether the claim alleged that Norfolk Southern âviolated a federal standard of careâ created by a federal regulation or an internal railroad company rule.1814 The court held that if Norfolk Southern did violate âa federal standard of careâ created by a federal regulation or an internal rule, 1808 Id., 529 U.S. at 358, 120 S. Ct. 1467, 146 L.Ed.2d 374. 1809 Id., 529 U.S. at 358-359, 120 S. Ct. 1467, 146 L.Ed.2d 374. 1810 706 F.3d 170, 174 (3d Cir. 2013), cert. denied, Norfolk S. Corp. v. Zimmerman, 2013 U.S. LEXIS 5469 (U.S., Oct. 7, 2013). 1811 Id. 1812 Id. at 175. 1813 Id. at 178. 1814 Id.
367 Zimmermanâs claim was not preempted.1815 Even if the defendant did not violate a federal standard of care or an internal rule, the court still had to decide whether any federal regulations covered the claim.1816 As discussed, a state claim is preempted by a federal regulation when the federal regulation ââsubstantially subsumes the subject matterâ of the claim.â1817 The Third Circuit held that the FRSA did not preempt the motoristâs claim of excessive speed1818 or failure to maintain a safe crossing area,1819 but the FRSA did preempt Zimmermanâs claim that Norfolk Southern was negligent per se.1820 The federal regulations on mandatory protective devices preempted the motoristâs state law claims that were based on the absence of such devices.1821 The Third Circuit affirmed the summary judgment in part and reversed it in part.1822 4. Liability for a Defect in a Crossing that Causes Personal Injury In Alumbaugh v. Union Pac. R. Co.1823 the plaintiff was injured when he drove his motorcycle over a railroad crossing in Kansas City. Alumbaugh alleged that deteriorated rubber rail-crossing equipment caused unevenness in the crossing for which he brought claims against 1815 Id. (citing 49 U.S.C. § 20106(b)(1)(A)-(B) (2007)). 1816 Id. 1817 Id. (quoting CSX Transp. Inc. v. Easterwood, 507 U.S. 658, 113 S. Ct. 1732, 123 L.Ed.2d 387 (1993)). 1818 Id. at 179-180. 1819 Id. at 188. 1820 Id. at 192. 1821 Id. at 192-193 (citing 23 C.F.R. § 646.214(b)(3), (b)(4) (2014)). 1822 Id. 1823 322 F.3d 520, 522-523 (8th Cir. 2003).
368 Union Pacific for negligence and negligence per se.1824 The Eight Circuit held that under Kansas law there was no cause of action for negligence per se.1825 However, because the evidence was sufficient for the jury to find that Union Pacific should have known of the defective condition, the court reversed the trial courtâs grant of a summary judgment for Union Pacific on the negligence claim.1826 5. Liability of a Railroad for Failure to Keep a Crossing Clear of Vegetation In Bryant v. Tenn-Ken R.R. Co., Inc.1827 a train struck Julie Bryant in a crossing marked with a crossbuck.1828 Bryant, who believed that the railroad track was not being used, was injured, but her passenger was killed.1829 Bryant alleged that the railroad company was negligent for failing to clear the crossing of vegetation.1830 On appeal, Bryant argued that the court should have instructed the jury on a Tennessee statute that ârequires railroad operators to âcut down all trees standing on [their] lands which are six (6) or more inches in diameter two feet (2â) above the ground and of sufficient height to reach the roadbed if they should fall.ââ1831 The Sixth Circuit upheld the trial courtâs decision that the statute was not intended to protect motorists, 1824 Id. at 523. 1825 Id. at 525. 1826 Id. at 525-526. 1827 108 Fed. Appx. 256 (6th Cir. 2004). 1828 Id. at 258. 1829 Id. 1830 Id. 1831 Id. at 259 (quoting Tenn. Code Ann. § 65-6-132 (2004)).
369 and, in any event, because of other evidence the requested instruction would have been unlikely to have affected the verdict.1832 6. No Preemption of a State Law when the Federal Law does not Subsume the Subject Matter Regulated by State Law In Strozyk v. Norfolk S. Corp.1833 the driver of a truck was killed in a collision with a Norfolk Southern train at a railroad crossing. Although crossbucks were in use at the crossing, Strozyk alleged that Norfolk Southern failed to maintain a grade crossing as required by state law and that vegetation obstructed driversâ view of oncoming trains.1834 Federal regulations establish standards for âadequate devices ⦠[when] Federal-aid funds participate in the installation of the devices.â1835 In CSX Transp., Inc. v. Easterwood1836 the Supreme Court held that federal regulations preempt state law when the federal regulations ââsubsume the subject matter of the relevant state law.ââ1837 A district court dismissed the plaintiffâs claims because federal regulations applied to the warning devices at the crossings.1838 The regulations identify factors that determine whether it is necessary to install active warning devices, including when there is an âunusually restricted sight distance.â1839 The district court held that the federal 1832 Id. at 260, 262. 1833 358 F.3d 268 (3d Cir. 2004). 1834 Id. at 270. 1835 Id. at 272 (quoting 23 C.F.R. § 646.214(b)). 1836 507 U.S. 658, 113 S. Ct. 1732, 123 L. Ed.2d 387 (1993). 1837 Strozky, 358 F.3d at 271 (quoting CSX Transp., Inc. v. Easterwood, 507 U.S. 658, 664-665 (1993)). 1838 Id. at 269, 272. 1839 Id. at 272 (quoting 23 C.F.R. § 646.214(b) (2003)).
370 regulations preempted both the claim for obstruction and the claim for failure to maintain the crossing.1840 The Third Circuit, however, held that although the federal regulations address adequate warning devices, the regulations did not âsubstantially subsumeâ the subject area of an obstruction impairing visibility; therefore, the federal regulations did not preempt the plaintiffâs claim based on an obstruction to visibility.1841 The court held that, because the regulations âdo not eclipse those duties ensuring safe grade crossings that are unrelated to warning devices,â the federal regulations did not preempt the plaintiffâs claim under state law that Norfolk Southern failed to maintain the crossing.1842 7. Whether State Law that Applied to Crossings was Preempted by a Federal Statute when Federal Regulations had not been Issued In Langemo v. Montana Rail Link, Inc.1843 the court ruled that 49 U.S.C. § 20153 did not at the time of the accident preempt Mont. Code Ann. § 69-14-562(7). The Montana statute provided that âit is a misdemeanor for any railroad corporation to âpermit any locomotive to approach any highway, road, or railroad crossing without causing the whistle to be sounded at a point between 50 and 80 rods from the crossing, the bell to be rung from said point until the crossing is reachedâ¦.ââ1844 Although § 20153 was enacted in 1994 and required the Secretary of Transportation to ââprescribe regulations requiring that a locomotive horn shall be sounded while 1840 Id. 1841 Id. at 273. 1842 Id. at 277. 1843 2001 ML 370, 2001 Mont. Dist. LEXIS 2131, at *1 (Mont. First Jud. Ct. 2001). 1844 Id. at *14 (citation omitted).
371 each train is approaching and entering upon each public highway-rail grade crossing,ââ1845 federal law did not preempt state law because only proposed rules were issued as of January 2000.1846 Furthermore, the court ruled that the railroad was not negligent per se for âfailing to sound a whistle, because the crossing was not in a public road.â1847 8. Whether the Public Utilities Commission Controlled a Railroad Crossing and Owed a Duty to the Plaintiffs because the Crossing was a Dangerous Condition of Public Property In Public Utilities Commission v. The Superior Court of Los Angeles County1848 the plaintiffs alleged that a railroad crossing constituted a dangerous condition because a recommendation in 1989 of the California Public Utilities Commission (PUC) âto upgrade the crossingâs warning devices by installing a gate was not implemented.â1849 At issue was whether the PUC, which did not own the railroad property where the crossing was located, controlled the property within the meaning of Cal. Govât Code § 830.1850 Specifically, in connection with the collision of a Union Pacific train and a truck that caused a fatal injury, the plaintiffs alleged that the PUC owed them a duty because the PUC owned or controlled the highway and crossing, because the public property constituted a dangerous condition, and because the PUC âfailed to 1845 Id. at *15 (quoting 49 U.S.C. 20153 (1994)). 1846 Id. 1847 Id. at *19. 1848 181 Cal. App.4th 364, 105 Cal. Rptr.3d 234 (Cal. App. 2010). 1849 Id., 181 Cal. App.4th at 366, 105 Cal. Rptr.3d at 235. 1850 Id.
372 provide traffic control and/or warning signals, signs, markings or other devices necessary to warn of a dangerous conditionâ¦.â1851 The court reviewed the duties of the former Railroad Commission, now the PUC, with respect to railroad tracks, as well as decisional authority, before holding that the PUCâs âregulatory authority over the crossing does not establish control of that property within the meaning of section 830â1852 and that âthe PUCâs right to inspect the crossing for safety violations and to close the crossing to vehicular and pedestrian (but not railroad) traffic does not establish control.â1853 Furthermore, âno evidence was offered that the PUC ever actively maintained the railroad crossing through any form of maintenance or repair.â1854 Articles 9. Preemption of State Tort Claims under the Easterwood, Shanklin, and Henning Cases One writer states that although the railroad industry has supported deregulation, the industry supports the FRSAâs preemption of state law claims to ensure that railroads are not held to multiple standards.1855 In CSX Transp., Inc. v. Easterwood1856 the Supreme Court interpreted the FRSA to require that federal regulations must âsubstantially subsume the subject matter of 1851 Id., 181 Cal. App.4th at 367, 105 Cal. Rptr.3d at 368. 1852 Id., 181 Cal. App.4th at 375, 105 Cal. Rptr.3d at 243. 1853 Id., 181 Cal. App.4th at 376, 105 Cal. Rptr.3d at 243. 1854 Id., 181 Cal. App.4th at 379, 105 Cal. Rptr.3d at 246 (emphasis in original). 1855 Ries, supra note 1383, at 103. 1856 507 U.S. 658, 113 S. Ct. 1732, 123 L.Ed.2d 387 (1993).
373 the relevant state law.â1857 When a federal regulation merely touches upon a matter regulated by state law there is no federal preemption.1858 The writer notes that in Norfolk Southern R.R. Co. v. Shanklin,1859 in which the plaintiff claimed that the railroad did not install adequate warning devices at a crossing, the Supreme Court held that because the warning signs were installed with federal funds the plaintiffâs state law claim was preempted.1860 However, a âclarifying amendmentâ later established some limits on preemption:1861 (1) Nothing in this section shall be construed to preempt an action under State law seeking damages for personal injury, death, or property damage alleging that a party â (A) has failed to comply with the Federal standard of care established by a regulation or order issued by the Secretary of Transportation (with respect to railroad safety matters), or the Secretary of Homeland Security (with respect to railroad security matters), covering the subject matter as provided in subsection (a) of this section; (B) has failed to comply with its own plan, rule, or standard that it created pursuant to a regulation or order issued by either of the Secretaries; or (C) has failed to comply with a State law, regulation, or order that is not incompatible with subsection (a)(2).1862 1857 Ries, supra note 1383, at 103 (citation omitted)). 1858 Id. at 104. 1859 529 U.S. 344, 120 S. Ct. 1467, 146 L. Ed.2d 374 (2000), superseded by statute as stated in Hunter v. Canadian Pac. Ry. Ltd., 2007 U.S. Dist. LEXIS 85110 (D. Minn. Nov. 16, 2007. 1860 Ries, supra note 1383, at 105-106. 1861 Id. at 106. 1862 49 U.S.C. § 20106(b) (emphasis supplied). The amendment applies to âall pending State law causes of action arising from events or activities occurring on or after January 18, 2002.â 49 U.S.C. § 20106(b)(2).
374 In Henning v. Union Pac. R. Co.,1863 in which the Eighth Circuit held that Henningâs claims for inadequate signalization and negligent delay were preempted by the applicable federal regulations, the court stated that â[t]he clarification amendment merely rectified the ⦠erroneous application of Shanklin and Easterwood to federal regulations establishing a federal standard of care.â1864 When the federal regulations âdo not create a federal standard of care, the clarifying amendment is not applicableâ¦.â1865 As stated, preemption applies when federal regulations âsubstantially subsumeâ a matter regulated by state law.1866 However, a railroad may be held liable for negligence when federal regulations impose a duty of care and the railroad fails to comply with the standard.1867 F. State Laws on to the Rights of Utilities to Use or Cross Certain Rights of Way Statutes and Regulations 1. Rights of a Public Utility in California If railroad tracks are on property that a public entity is authorized to acquire by eminent domain for a right of way for a public utility, âa plaintiff may require the relocation or removal of such tracks by exercise of the power of eminent domain.â1868 2. Rights of Utilities in Michigan Although not mentioning railroads, a Michigan statute provides: 1863 530 F.3d 1206 (8th Cir. 2008). 1864 Id. at 1216. 1865 Id. See Ries, supra note 1383, at 107-108. 1866 Ries, supra note 1383, at 109. 1867 Id. at 108. 1868 Cal. Pub. Util. Code § 7557 (2014).
375 (1) Except as otherwise provided under subsection (2) ⦠public utility companies ⦠may enter upon, construct, and maintain telegraph, telephone, or power lines, pipe lines, wires, cables, poles, conduits, sewers or similar structures upon, over, across, or under any public road, bridge, street, or public place, including, longitudinally within limited access highway rights-of-wayâ¦. A ⦠public utility company ⦠shall first obtain the consent of the governing body of the city, village, or township through or along which these lines and poles are to be constructed and maintained. (2) A utility as defined in 23 CFR 645.105(m) may enter upon, construct, and maintain utility lines and structures, including pipe lines, longitudinally within limited access highway rights-of-way and under any public road, street, or other subsurface that intersects any limited access highway at a different grade, in accordance with standards approved by the state transportation commission and the Michigan public service commission that conform to governing federal laws and regulations and is not required to obtain the consent of the governing body of the city, village, or township as required under subsection (1).1869 3. Dispute Process to Petition the DOT for Hearing before an Administrative Law Judge regarding a Utility Crossing Michiganâs Railroad Code § 462.265(1)(a) provides in part that the railroad company and railroad authority must be given 30-days notice before stringing an electrical wire âover and across ⦠crossings within the right-of-way of a public street, highway, road, or alleyâ¦.â Subpart (1)(b) provides that [f]or crossings at any other location not within the right-of-way of a public street, highway, road, or alley, notification shall first be given to the railroad company and railroad authority in writing of the place and the manner in which the corporation or person desires to string the wire and written or telegraphic permission shall be received from the railroad company and railroad authority prior to performance of the work. The railroad company shall respond positively or negatively to the request within 90 calendar days after the receipt of the request.1870 1869 Mich. Comp. Laws § 247.183(1) (2014). 1870 Michigan Railroad Code §§ 462.265(1)(a) and (b) (2014).
376 Subsection (3) provides that â[i]n case of a dispute emanating from subsections (1) and (2) which the parties cannot resolve within a reasonable time, either party may petition the department for a hearing,â which has jurisdiction to settle disputes.1871 Cases 4. Waiver of Immunity of a Commuter Rail Line from an Action by a Utility to Condemn a Right of Way In Oncor Electric Delivery Co. LLC v. Dallas Rapid Transit,1872 Oncor Electric Delivery Co. LLC (Oncor), an electric utility company in Texas, received approval from the Texas Public Utility Commission to construct a new transmission line. The new line would have to cross a public commuter rail line operated by the Dallas Area Rapid Transit and the Fort Worth Transportation Authority (the Authorities).1873 When the Authorities and the electric utility company could not agree on Oncorâs right of way, the utility sued the Authorities to condemn an easement.1874 After an appellate court affirmed the trial courtâs holding that the Authorities as governmental entities were immune from a suit for condemnation of an easement,1875 Oncor petitioned the Supreme Court of Texas for review.1876 Meanwhile, the Texas legislature enacted legislation providing that ââthe rights extended to an electric corporation ⦠include all public 1871 Michigan Railroad Code § 462.265(3) (2014). 1872 369 S.W.3d 845, 847 (Tex. 2012). 1873 Id. 1874 Id. at 848. 1875 Id. 1876 Id.
377 land, except land owned by the state.ââ1877 Oncor argued that the case should be remanded to consider the effect of the new law.1878 The Supreme Court of Texas held that because the only purpose of the new statute was âto provide for rights that can actually be exercisedâ the statute waived the Authoritiesâ governmental immunity.1879 However, the Authoritiesâ rail lines did not come within the exception for state-owned land.1880 5. Utilityâs Expropriation of Land for a Crossing as a Public Use Under a Louisiana statute, a common carrier such as a pipeline company may condemn private property.1881 In Exxon Mobil Pipeline Co. v. Union Pac. R.R. Co.,1882 after Union Pacific denied ExxonMobilâs request to construct a crossing, ExxonMobil sought to expropriate a permanent right of way across Union Pacificâs property.1883 However, the district court held that ExxonMobil had failed to show that the expropriation was for a public use.1884 Because ExxonMobil limited the use of the crossing to its own employees, an appellate court affirmed the district courtâs holding that the publicâs use of the property was restricted.1885 1877 Id. (quoting Tex. Util. Code Ann. § 37.053(d)). 1878 Id. at 848-849. 1879 Id. at 850. 1880 Id. 1881 Exxon Mobil Pipeline Co. v. Union Pac. R.R. Co., 35 So.3d 192, 193-194 (La. 2010) (citing La. Rev. Stat. § 45:254), rehearing denied, 2010 La. LEXIS 1070 (La., May 7, 2010). 1882 Id. at 194. 1883 Id. at 195. 1884 Id. at 195-196. 1885 Id.
378 In later reversing and remanding the case the Supreme Court of Louisiana held that the use of the expropriated property would benefit the public because the road would allow the pipeline company to inspect its pipeline that provides petroleum to the public.1886 Therefore, ExxonMobil was held to have the ability to expropriate a right of way across the rail line.1887 6. Whether an Independent Transmission Company could avail itself of a âPay-and-Goâ Procedure Used by Utilities to Cross a Railroad Right of Way At issue in Hawkeye Land Company v. Iowa Utilities Board1888 was an Iowa statute that âauthorizes a âpay-and-goâ procedure with a legislatively predetermined $750 standard crossing fee the utility pays to the owner of the railroad right-of-way.â1889 The dispute arose when the Iowa Utilities Board allowed ITC Midwest, an independent transmission company, to avail itself of the âstatute to run electrical power lines across a railroad at three locations--over the objection of the owner of the railroad-crossing easement.â1890 The owner, Hawkeye Land Co., did not own or operate a railroad but owned the âright to sell easements across active railroad tracks.â1891 Hawkeye had obtained the right to sell easements when the Chicago, Rock Island and Pacific Railroad âwent through bankruptcy [and] the bankruptcy trustee separated the easement rights from the fee and transferred those easement rights to Chicago Pacific Corporation ⦠[that] in 1886 Id. at 197-199, 202. 1887 Id. at 202. 1888 847 N.W.2d 199 (Iowa 2014). 1889 Id. at 201. 1890 Id. 1891 Id.
379 turn deeded the easement rights to Hawkeye Land.â1892 Hawkeye argued that it did not acquire its rights directly from a railroad and, thus, the crossing statute did not apply to it or to ITC Midwest, âbecause [Hawkeye] is not a ârailroadâ and ITC Midwest is not a âpublic utilityâ within the meaning of the statute.â1893 The court held that the definition of a public utility in Iowa Code § 476.1 did not include independent transmission companies.1894 Rather, the statute only applied to a âdirect transaction between [a] public utility and the public.â1895 Thus, ITC Midwest could not use the pay-and-go procedure under Iowa Code § 476.1.1896 On the other hand, § 476.27(1)(g) applied to Hawkeye as a successor in interest to a railroad that owned the right to grant easements across railroad tracks. The court held that it was âimmaterial that Hawkeye obtained the easement rights from an entity created by the railroadâs bankruptcy trustee rather than directly from a railroad.â1897 Article 7. Railroad Abandonment of Property also used by a Utility An article in the Ecology Law Quarterly discusses ways in which a utility may be able to continue its easement after a railroad has abandoned a rail line.1898 The article appears to be 1892 Id. at 212. 1893 Id. at 201. 1894 Id. at 214. 1895 Id. at 216. 1896 Id. at 219. 1897 Id. at 212. 1898 Danaya C. Wright & Jeffrey M. Hester, âPipes, Wires, and Bicycles: Rails-to-Trails, Utility Licenses, and the Shifting Scope of Railroad Easements From the Nineteenth to the Twenty-First Centuries,â 27 Ecology L.Q. 351, 438 (2000).
380 relevant to a situation when a utility does not occupy a railroad right of way but has been authorized to cross it. When a railroad easement includes a license for a utility, the railroadâs abandonment of the property may affect the utilityâs right to the property. When a railroad terminates an easement, any utility sub-easement also is terminated.1899 The doctrines of prescription, prior use, estoppel, and shifting public use may be used to prevent a termination of a sub-lease after the termination of a railroadâs easement.1900 Moreover, when a railroad owns property in fee simple absolute, a utility having an easement retains its rights to the property.1901 If a railroad leases part of its easement to a utility, the leasing is evidence of the intent not to abandon the easement.1902 Therefore, a railroadâs leasing of land to a utility may protect a utilityâs rights in the subject property.1903 There are other ways that the utility may preserve its rights in the property after the railroad abandons it.1904 For instance, if the owner of the property does not remove the utility, the utility may have an easement by prescription.1905 Some states, such as Indiana, South Dakota, and Iowa, have statutes that allow utilities to remain on a property even after a railroad company abandons it.1906 1899 Id. at 438-439. 1900 Id. at 439. 1901 Id. 1902 Id. 1903 Id. 1904 Id. 1905 Id.
381 G. Compensation for Damage Occasioned by the Construction, Relocation or Closure of Crossings In Pennsylvania, compensation for damages, after proper notice and hearing, is determined by the Pennsylvania Public Utility Commission.1907 âSuch compensation ⦠shall be borne and paid ⦠by the public utilities, municipal corporations, municipal authority or nonprofit organization authorized under section 2702(h).â1908 Furthermore, â[t]he amount of damages or compensation determined and awarded to be paid the owners of adjacent property by the Commonwealth shall, in each instance, be paid by the State Treasurer, on a warrant drawn by the State Treasurer.â1909 If a party is dissatisfied with the Commissionâs determination, the dissatisfied party may appeal the determination in court.1910 Compensation also may be mutually agreed upon and paid by the interested parties.1911 The statuteâs provisions do not apply âto commerce with foreign nations, or among the several states, except insofar as the same may be permitted under the provisions of the Constitution of the United States and the acts of Congress.â1912 1906 Id. at 440. 1907 66 Pa. Cons. Stat. § 2704(a) (2014). 1908 Id. 1909 66 Pa. Cons. Stat. § 2704(c) (2014). 1910 66 Pa. Cons. Stat. § 2704(b) (2014). 1911 66 Pa. Cons. Stat. § 2704(a) (2014). 1912 66 Pa. Cons. Stat. § 104 (2014).
382 Cases H. Railroad Liability for Injuries at Private Crossings 1. Whether a Railroad has assumed a Duty of Care at a Private Crossing In Calhoun v. CSX Transportation, Inc.1913 the issue was whether a crossing was public or private. Although generally a railroad has no duty at a private crossing, a duty may arise when âa different duty was assumed; if the crossing is, or becomes, ultra-hazardous; or where, by pervasive use, the character of a private crossing has changed to a public one.â1914 The Calhoun case arose as a result of a non-fatal accident when a CSX train collided with a car driven by Mary Calhoun. The jury found that CSX did not breach any duty to Calhoun. On review, the Supreme Court of Kentucky had to determine whether the crossing was public or private. Because the unnamed gravel road was never established by statute and was maintained by two property owners, the court held that the crossing was private.1915 In Kentucky a railroad is âânot liable for injuries to a traveler at [a private] crossing unless after discovery of his peril, they fail to use all means to avoid the accidentâ ⦠and central to the present case [is that] a railroad has no duty to clear vegetation at private crossings.â1916 The court held that the plaintiffs/appellants were asking the court âessentially [to] whitewash the entire common law framework created over the last two centuries.â1917 However, as for the exceptions to Kentuckyâs minimal duty rule at private railroad crossings, the Kentucky 1913 331 S.W.3d 236 (Ky. 2011). 1914 Id. at 238. 1915 Id. at 241. 1916 Id. at 242 (citations omitted). 1917 Id. at 243.
383 Supreme Court reversed the Court of Appealsâ decision and remanded the case to the circuit court. The court ruled that the appellate court and the circuit court had erred because âthere [was] a genuine issue of material fact for trial as to whether the BCS crossing was ultra- hazardous due to the vegetation and the relevant positioning of the crossing.â1918 The court affirmed the appellate courtâs other rulings. 2. Whether a Railroad has a Duty at a Private Crossing Alleged to be Extra- Hazardous In Gaw v. CSX Transportation, Inc.1919 the plaintiffs alleged that CSX had the duty to warn but failed to provide adequate warning of the approach of a train that killed Mr. Gaw and injured two others.1920 Among other things, the plaintiffs alleged that the crossing where the accident occurred was âextra-hazardousâ because of vegetation, that there was an âinappropriate slopeâ in the area, and that the ârough and unevenâ area was a distraction to drivers.1921 The court stated that in Kentucky â[t]he statutory requirements for public crossings do not apply to private crossingsâ and that âthe general rule ⦠has long been ⦠that there exists no duty to warn, provide [a] lookout, or clear view obstructing vegetation at a private crossing.â1922 In Kentucky for a crossing to be a public crossing âthe the crossing must be âdedicated to public 1918 Id. at 245-246 (citation omitted) (footnote omitted). 1919 2008 U.S. Dist. Lexis 23131, at *1 (W.D. Ky. 2008), affâd, 2009 U.S. App. Lexis 11334 (6th Cir. 2009). 1920 Id. at *5. 1921 Id. at *5-6. 1922 Id. at *8 (citations omitted).
384 useâ and incorporated into the state, county, or local road system. If [the] crossing does not meet both requirements, it is not a public crossing, and is considered a private one.â1923 The court recognized that a â[i]f there is habitual and pervasive public use of an otherwise private crossing, Kentucky common law provides that this may impose [a] duty to warn, keep lookout, or slacken locomotive speed on the railroad.â1924 Duties may arise whereby a railroad must take action to protect the public at private crossings that are found to be âextra- hazardous.â1925 In addition, a railroadâs actions at or before a crossing, such as signaling a trainâs approach, may support a finding on the railroadâs assumption of a duty to the public.1926 Based on the record, however, discussed in the opinion, the court concluded that none of the exceptions applied and granted CSXâs motion for a summary judgment.1927 3. Railroadâs Duty at an Extra-Hazardous Private Crossing In Illinois Central Railroad Company v. White1928 the railroad argued that it had no duty under Mississippi law at a private crossing where a farmer was killed as he attempted to cross from one section of his farm to another.1929 The railroad argued that the decedent was negligent for having violated Miss. Code Ann. § 63-3-1013, because the statute imposed âa mandatory duty upon the operator of any type of equipment having an operating speed of six or less miles 1923 Id. at *10-11 (citation omitted). 1924 Id. at *12. 1925 Id. at *14. 1926 Id. at *17. 1927 Id. at *19. 1928 610 So.2d 308 (Miss. 1992). 1929 Id. at 309.
385 per hour to inform the railroad prior to making a crossing.â1930 On the other hand, by reason of Miss. Code Ann. § 77-9-249 âa statutory violation in and of itself will not defeat recovery, and the question of negligence shall be left to the jury, along with the appropriate comparative negligence principles which would be applicable in such cases.â1931 Although generally a railroad has no statutory duty [a]t private crossings which people habitually traverse, a railroad companyâs duty to give signals and maintain the crossing is relative to circumstances existing at the particular time. Thus, peculiar or extraordinary circumstances might differentiate such crossings from other private crossings, accordingly impacting on the railroad companyâs duty.1932 The court concluded that the record âsupport[ed] plaintiffsâ assertion that the crossing was âextra-hazardous.ââ1933 The court upheld a jury verdict that the railroad was negligent for ânot doing more to warn of [the] impending approach of trains at the Whiteâs crossing.â1934 4. Railroadâs Right to Submit Evidence that it was not Required to Apply Safety Standards and Recommendations at a Private Crossing In Webb v. Union Pacific Railroad Company,1935 involving a train-vehicle collision at a railroad crossing, the court held that Union Pacific âshould have been permitted to submit evidence and argument to show that it was not required to apply the safety standards and 1930 Id. at 315. 1931 Id. 1932 Id. at 316-317 (citation omitted). 1933 Id. at 317. 1934 Id. at 319. 1935 2012 Ill. App. Unpub. LEXIS 494, 2012 IL. App. (5th) 100607-U (Ill. App. 2012).
386 recommendations at private crossings.â1936 The court, however, ruled that on remand on the railroadâs claim that the crossing was a private one, the trial court would have âto determine whether control remains an issue. We do not find that the trial court abused its discretion in permitting some evidence on the issue of the Railroadâs control over and maintenance of the subject crossing.â1937 5. Whether a Railroad is Liable after Failing to Maintain Whistle Posts and Crossing Signs at a Railroad Crossing believed to be a Private Crossing In Cook v. CSX Transportation, Inc.1938 the plaintiff, an engineer for CSX Transportation (CSXT), was injured on a coal train when the train collided with a pickup truck at what Cook and the conductor mistakenly believed was a private crossing.1939 At issue was whether CSXT violated federal and state law, in part, for failing to maintain whistle posts and road-crossing signs at the crossing.1940 In granting a motion for summary judgment for CSXT, the court stated that for a jury to conclude, based on this argument, that CSXT breached its alleged duty to maintain the whistle post, the jury would have to impose on CSXT not only a near-constant duty to monitor all of its signs and signals, including those which federal law does not mandate, but also a near-immediate responsibility to repair or replace a noncompliant item. In effect, this would create a cause of action in strict liability rather than in negligence.1941 1936 Id., 2012 Ill. App. Unpub. LEXIS 494 at *16, 2012 IL. App. (5th) 100607-U at P18. 1937 Id., 2012 Ill. App. Unpub. LEXIS 494, at *33, 2012 IL. App. (5th) 100607-U at P41. 1938 2014 U.S. Dist. LEXIS 147661, at *1 (N.D. Ohio 2014). 1939 Id. at *2. 1940 Id. at *4. 1941 Id. at *9 (citation omitted).
387 The court also rejected Cookâs claim âthat CSXT was negligent because the crossbucks at the railway crossing [did] not comply with Ohio lawâ for the reason that the state law was âpreempted by the Federal Railroad Safety Actâ¦.â1942 6. Whether the State DOT has Jurisdiction to Close a Private Crossing In B&W Lumber Company, Inc. v. Norfolk Southern Corporation1943 the plaintiff B&W Lumber Company, Inc. (B&W) owned commercial property near a railroad crossing. B&W filed an action to prohibit the closure of a crossing following a fatal accident at the crossing. The court explained that âB&Wâs assertion that the Disputed Crossing is or should be deemed a public crossing or public way provides the basis for naming SCDOT as a Defendant.â1944 Although the plaintiff acknowledged that the South Carolina DOT treats the crossing as a private one, B&W nevertheless argued that âit had a legitimate basis for seeking a declaration that the Disputed Crossing is public or should be treated as such by SCDOT given the long-term public use of the crossing.â1945 In construing S.C. Code Ann. § 58-15-1625 regarding the transportation departmentâs authority to close grade crossings, the court held that the language in the statute was not âso clear as to foreclose the possibility that a court will interpret the statute to allow (or require) SCDOT to assume jurisdiction over a private crossingâ¦.â1946 1942 Id. at *11. 1943 2009 U.S. Dist. LEXIS 51732, at *1 (D. S.C. 2009). 1944 Id. at *4. 1945 Id. at *8. 1946 Id. at *15, N 7.
388 7. Calculation of Offset in Settlement with a Railroad in Claim against a Private Party for Creating a Hazardous Condition near Railroad Tracks In RGR, LLC v. Georgia Settle, Personal Representative of the Estate of Charles E. Settle, Sr., Deceased1947 Settle was fatally injured when a Norfolk Southern train struck the dump truck that he was driving on a private road that crossed railroad tracks owned by Norfolk Southern.1948 At issue was whether the defendant created a hazardous condition when the defendant stacked lumber near the railroad tracks that blocked motoristsâ view of the tracks at the crossing.1949 Although there was a settlement with Norfolk Southern, a jury later awarded $2.5 million to the decedentâs estate in his wrongful death action. The Supreme Court of Virginia ruled that RGR, LLC was negligent and affirmed the verdict but remanded for further proceedings by the trial court on how to calculate the offset of $500,000 that the decedentâs estate had obtained in a settlement with Norfolk Southern.1950 1947 764 S.E.2d 8, 2014 Va. LEXIS 161, at *1 (Va. 2014). 1948 Id., 764 S.E.2d at 12, 2014 Va. LEXIS 161, at at *2. 1949 Id., 764 S.E.2d at 12, 2014 Va. LEXIS 161, at *3. 1950 Id., 764 S.E.2d at 29, 2014 Va. LEXIS 161, at 56.
389 XV. DAMAGE TO OR MAINTENANCE OF PROPERTY A. Introduction This part of the Report discusses damage to property caused by or sustained by a railroad. Section B discusses damage to railroad bridges and other property, state statutes that apply to the construction and maintenance of railroads, cases on damage caused by a vessel to a bridge owned or used by a railroad, and a state administrative agencyâs authority to allocate the cost of bridge repair to a railroad. Section C deals with damage to property caused by a railroad beginning with a state statute applicable to property damage caused by a railroad, cases on the liability of railroads for flooding adjacent property, and whether the Interstate Commerce Commission Termination Act (ICCTA)1951 preempts state tort claims against a railroad for property damage. B. Liability of a Railroad for Neglect of a Bridge Statutes 1. Damages for Violation of a Statute Applicable to Bridges An Iowa statute requires that railroad companies build and maintain all bridges necessary for a railroad to cross over or under another railway, highway, or waterway.1952 The railroad company is liable for damages to âany person by reason of any neglect or violationâ of the statute.1953 1951 Pub. L. 104â88 (Dec. 29, 1995). See 49 U.S.C. § 10102 (2014). 1952 Iowa Code § 327F.2 (2014). 1953 Id.
390 2. Liability for the Cost of a Bridge Required for Drainage In Illinois, when a drain apparently owned by a district authority (district) crosses an existing railroad and a bridge is necessary for the crossing the district is liable to the railroad for the cost of constructing and maintaining the bridge.1954 If the district plans to construct a ditch for drainage under a railroad and the dimensions of a railroad bridge are not sufficient, the district may request the railroad to replace or enlarge the bridge.1955 If a railroad does not construct the bridge within six months, the railroad is liable for all damage to surrounding property.1956 3. Liability for the Cost of a Crossing over or under a Railroad and for Bridge Repair Under a Maine statute if a railroad is constructed over or under another railroad or canal, the âcorporation making the crossing is liable for damages, occasioned by making the crossing.â1957 When a municipality notifies the corporation responsible for a bridge that it needs to be repaired the responsible corporation must repair the bridge within ten days of the notice.1958 1954 70 Ill. Comp. Stat. § 605/12-4 (2014). 1955 Id. 1956 Id. 1957 23 Me. Rev. Stat., title 23 § 7209 (2014). 1958 Id.
391 Cases 4. Whether a Railroadâs Agreement with a Transit Company to Maintain a Bridge Relieved the Railroad of its Obligation under § 93 of the New York Railroad Law In City of Middletown v. Wallkill Transit Co.1959 the city of Middleton sought to collect the cost of repairing the framework of a steel and iron highway bridge crossing the tracks of the Erie Railroad Company over which a transit company operated. The Erie Railroad Company maintained that the transit companyâs predecessor âin consideration of the privilege of crossing the Erie Railroad Companyâs tracks, agreed to maintain the said bridge and keep it in repair.â1960 At the time of the case, § 93 of the Railroad Law of New York provided: When a highway crosses a railroad by an overhead bridge, the frame-work of the bridge and its abutments shall be maintained and kept in repair by the railroad company, and the roadway thereover and the approaches thereto shall be maintained and kept in repair by the municipality having jurisdiction over, and in which the same are situated. The court held that the agreement did not relieve the railroad company of its obligation to the city under § 93.1961 Although the railroad company may have had a claim against the transit company for the failure to repair and maintain the bridge, the city as a non-party to the agreement was not bound by it.1962 1959 18 Misc. 334, 193 N.Y.S. 297 (N.Y. Sup. Ct. 1922). 1960 Id., 18 Misc. at 335, 193 N.Y.S. at 298. 1961 Id. 1962 Id.
392 5. Whether a Railroadâs Duty under § 93 of the New York Railroad Law to Maintain and Repair a Bridge included a Duty to Erect Signage In Aramini v. CSX Transportation, Inc.1963 a sanitation department employee attempted to drive a truck on a street âover which CSX railroad tracks pass via a supporting railroad bridgeâ¦.â1964 The plaintiff argued that CSX was negligent, inter alia, in âoperating a bridge with insufficient clearanceâ and in âfailing to fulfill its duties under New York Railroad Law § 93â¦.â1965 Ultimately, the plaintiffâs sole allegation concerned CSXâs failure to provide a sign that adequately alerted drivers to the actual height of the bridge.1966 The court held that the âstatutory obligation to maintain and repair bridge structuresâ did not include âa duty to erect signageâ¦.â1967 The duty to erect signs belonged to the city.1968 Furthermore, there was no evidence that CSX âknew or should have known of the [existing] signâs condition.â1969 6. Triable Issue of Fact on whether an Expansion Joint was Part of a Bridge and Abutments under § 93 of the New York Railroad Law In Oppenheim v. Village of Great Neck Plaza, Inc.1970 the plaintiff alleged that she was injured when her toe became stuck in an expansion joint of a bridge located above the railroad tracks. The court held that under New York Railroad Law § 93 the defendant Long Island 1963 2014 U.S. Dist. Lexis 74154, at *1 (W.D. N.Y. 2014). 1964 Id. at *2. 1965 Id. at *3-4. 1966 Id. at *7. 1967 Id. at *9-10. 1968 Id. at *10. 1969 Id. at *15. 1970 46 A.D.3d 527, 846 N.Y.S.2d 628 (N.Y. App. 2d Depât 2007).
393 Railroad âfailed to provide evidence sufficient to establish that the expansion joint was not part of âthe framework of the bridge and its abutmentsââ and that there were âtriable issues of fact ⦠whether the expansion joint constituted a defective condition.â1971 7. Whether the âSecond Comerâ Doctrine Imposed a Duty of Complete Reconstruction of a Bridge In Baltimore & Ohio Railroad Company v. Kuchta1972 the Court of Appeals of Maryland reviewed a trial courtâs decision holding that the Baltimore & Ohio Railroad Company (B&O) was liable to the city of Baltimore for the cost of reconstructing a bridge over B&Oâs tracks near Morrell Park. B&O argued that its responsibility to maintain the bridge did not include rebuilding it. As the court explained, [u]nder this so-called âsecond comerâ doctrine, the builder of a new way or road whose course intersects another way or road already in existence and use is responsible to repair the damage it made in crossing the first way or road including the construction of a bridge or viaduct, if necessary, and to bear the cost of maintaining the viaduct or bridge in a manner which insures the safety and convenience of the users of the first way or road.1973 That is, as a second comer, B&O had to âprovide a safe structure to carry the public road over its railroad.â1974 B&O argued that an agreement between it and the county, the cityâs predecessor in interest, meant that the city had âabandoned its asserted common law right as first comer to the intersection of the railroad with the public wayâ¦.â1975 B&O also argued that the second comer 1971 Id., 46 A.D.3d at 528, 846 N.Y.S.2d at 629. 1972 76 Md. App. 1, 543 A.2d 371 (1988). 1973 Id., 76 Md. App. at 6, 543 A.2d at 374 (citation omitted). 1974 Id., 76 Md. App. at 7, 543 A.2d at 374. 1975 Id.
394 doctrine did not include the rebuilding of a structure.1976 The court held that the commissionersâ attempt to relinquish the countyâs common law rights as a first comer was âbeyond the scope of their authority[] and therefore ultra vires.â1977 Importantly, however, the court also rejected the âappellantâs alternative argument that the second comer doctrine did not impose upon it the duty of completely reconstructing Bridge 5A.â1978 8. 28 U.S.C § 130âs Preemption of the âSecond Comerâ Doctrine in a Case involving Bridge Reconstruction and Maintenance In CSX Transportation, Inc. v. Mayor and City Council of Baltimore City, Maryland1979 the dispute concerned whether an agreement between the Baltimore and Ohio Railroad Company (B&O), the predecessor of CSX Transportation, Inc. (CSXT), and the City of Baltimore (City) was a valid and binding contract. Under the agreement the âCity ⦠assume[d] any responsibilities which CSXT may have for reconstruction and maintenance of the bridges in exchange for the payment by CSXT to the City of fifteen percent of the projectsâ costs, up to $916,000.â1980 Based on the decision in Baltimore and Ohio Railroad Co. v. Kuchta,1981 supra, XV.B.7, the city argued that the agreement was ultra vires. When the city and B&O were negotiating the agreement at issue in this case the same parties were âlitigating a dispute over whether the B&O 1976 Id. 1977 Id., 76 Md. App. at 8, 543 A.2d at 375. 1978 Id., 76 Md. App. at 10, 543 A.2d at 376 (citation omitted). 1979 759 F. Supp. 281 (D. Md. 1991). 1980 Id. at 282. 1981 76 Md. App. 1, 543 A.2d 371, cert. denied, 313 Md. 688, 548 A.2d 128 (1988).
395 was responsible for the cost of reconstruction of another bridge over B&O tracks in an area known as Morrell Park.â1982 In Kuchta, [t]he Court of Special Appeals held that the B&O was liable for paying the entire cost of reconstruction of the Morrell Park bridge and that a 1907 agreement, which B&O contended required the City to pay one-half of the reconstruction cost, was void. The decision rested upon the âsecond comerâ doctrine, well established in the common law, which provides, in effect, that a party who builds a new road or way intersecting an existing right of way is responsible for constructing and maintaining a safe crossing at the intersection.1983 In Kuchta â[t]he court reasoned that, because the second comer doctrine made the B&O liable for one hundred percent of the cost of reconstruction of the Morrell Park bridge, the City unlawfully surrendered its police power and committed an ultra vires act when it entered into the 1907 agreement.â1984 For purposes of the motion for summary judgment in this case, CSXT had assumed that because of the Kuchta decision the agreement with the city was void.1985 However, the issue was whether 23 U.S.C. § 130 preempted the second comer doctrine.1986 The court explained that 23 U.S.C. § 130 was enacted as a part of the Federal-Aid Highway Act of 1944, the purpose of which was âto relieve railroads of the burden of rehabilitating or replacing railway-highway crossings, including bridges.â1987 The court further noted that in 1958 when the statute was revised âCongress was fully aware of the general purpose of the Act to relieve railroads of the 1982 CSX Transportation, Inc., 759 F. Supp. at 283. 1983 Id. 1984 Id. 1985 Id. 1986 Id. 1987 Id.
396 burden of paying for the improvement of crossings.â1988 The court also noted that âlanguage was added to âlimit the contribution for a railway-highway crossing elimination to 10 percent from all railroads involved in a particular project, and not expect 10 percent contribution from each railroad.ââ1989 The court held that â[t]o permit states to recover from a railroad the cost of constructing or reconstructing a bridge under the second comer doctrine would be self-evidently inconsistent with Congressâs intent to have at least ninety percent of that cost borne by governmental authorities on federally funded projectsâ and that âonce a state or local government agrees to the federal funding of a railroad crossing construction or reconstruction project, it cannot seek to impose the cost of that project upon the railroad.â1990 In discussing the applicable federal regulations, (see 23 C.F.R. § 646.210(a) and (b)(2)), the court determined that the âunspoken premise is that the second comer doctrine does not apply where federal funding is providedâ and that âit is obvious that to permit a state or local government to first receive federal funding for a project, and then to obtain like reimbursement from a railroad for the cost of the same project would be to provide a windfall to the state or local government.â1991 Therefore, to the extent that âKuchta would have the effect of voiding the September 24, 1986 Agreement, it is preempted by federal lawâ¦.â1992 1988 Id. at 284. 1989 Id. (citation omitted). 1990 Id. 1991 Id. 1992 Id.at 286.
397 9. Liability for Damage to a Bridge Owned by a Railroad when the Bridge is Struck by a Vessel In Union Pac. R. Co. v. Kirby Inland Marine, Inc.1993 the M/V MISS DIXIE and/or its tow collided on May 5, 1996, with the Clinton Railroad Bridge (Clinton Bridge) constructed in 1907 and owned by Union Pacific.1994 To prove Union Pacificâs negligence, the owner of the MISS DIXIE, Kirby Inland Marine, Ltd. (Kirby), sought to rely on a Coast Guard Order to Alter (Order), issued on February 28, 1996, that had found that the Clinton Bridge was an âunreasonable obstruction to navigationâ pursuant to a federal statute, the Truman-Hobbs Act.1995 Although the parties in the Kirby Inland Marine, Inc. case had entered into a settlement agreement, the agreement left one legal issue for the Iowa federal district court to resolve: whether the Coast Guardâs Order made âinapplicable any presumption that negligence of the barge crew was the cause of an allision between a moving vessel and a stationary bridge.â1996 The Eighth Circuit explained that the above presumption is based on the Oregon rule,1997 which is âa presumption that a vesselâs crew was negligent when a vessel strikes a stationary object such as a bridge.â1998 Thus, the issue was whether the Coast Guardâs Order âtrumpsâ the 1993 296 F.3d 671 (8th Cir. 2002), cert. denied, Union Pac. R.R. Co. v. Kirby Inland Marine, Inc., 2003 U.S. LEXIS 1124 (U.S. Feb. 24, 2003); cert. denied, Kirby Inland Marine, Inc. v. Union Pac. R.R., 2003 U.S. LEXIS 1123 (U.S. Feb. 24, 2003). 1994 Id. at 673. 1995 Id. 1996 Id. 1997 The Oregon, 158 U.S. 186, 197, 39 L. Ed. 943, 15 S. Ct. 804 (1895). 1998 Id.
398 Oregon rule.1999 The district court had eliminated the Oregon rule by applying the Pennsylvania rule:2000 ââwhere any party violates a statutory or regulatory rule designed to prevent collisions, that party has committed per se negligence ⦠and [the party] has the burden of proving that its statutory fault was not a contributing cause of the accident.ââ2001 The district court ruled that Union Pacific violated the Truman-Hobbs Act as evidenced by the Coast Guard Order. Thus, the Oregon rule that attached fault to the owner of the vessel was âshifted backâ to the owner of the structure under the Pennsylvania rule.2002 However, the Eight Circuit held that because the Truman-Hobbs Act has to do with funding, not safety,2003 it was improper to shift responsibility from the vessel-owner back to the bridge-owner, Union Pacific.2004 The Clinton Bridge may have been an obstruction but it was still a lawful bridge. The court held that the district court should have applied the Oregon rule. The next question was whether the Coast Guard Order ârebuts the Oregon presumption and shifts the burden of proof back to the bridge owner.â2005 The Eighth Circuit held that it could not decide the issue as a matter of law. Rather, the Eighth Circuit held that on remand the 1999 Kirby Inland Marine, Inc., 296 F.3d at 674. 2000 The Pennsylvania, 86 U.S. 125, 136, 22 L. Ed. 148 (1873). 2001 Kirby Inland Marine, Inc., 296 F.3d at 674 (citation omitted). 2002 Id. 2003 Id. 2004 Id. at 675. 2005 Id. at 676.
399 district court should determine whether the âOregon presumption is rebutted by the Coast Guardâs Order to Alterâ¦.â2006 10. Liability for Damage to Bridge Used but not Owned by a Railroad In Louisville & Nashville R.R. Co. v. M/V Bayou Lacombe,2007 after a tugboat hit a bridge used by the Louisville and Nashville Railroad Company (L&N) and L&N sued for damages under the Admiralty Extension Act, a district court granted a summary judgment for the tugboat and the Oil Transportation Co., the owner of the tugboat.2008 The Admiralty Extension Act provides that maritime jurisdiction is applicable to all damage âcaused by a vessel on navigable water.â2009 Previously, the Supreme Court had held that a plaintiff who does not have a property interest in a damaged vessel could not recover damages sustained by the vessel.2010 Although in another case it was held that a railroad had a right similar to an easement in a bridge,2011 L&N argued that under Alabama law it had a property interest in the bridge.2012 The Fifth Circuit held that L&N did not have a property interest in the bridge that would permit L&N to recover for damages to the bridge.2013 The agreement between L&N and 2006 Id. 2007 597 F.2d 469 (5th Cir. 1979). 2008 Id. at 470. 2009 Id. at 472 (quoting 46 U.S.C. § 740 (1975)). 2010 Robins Dry Dock & Repair Co. v. Flint, 275 U.S. 303, 48 S. Ct. 134 (1927). 2011 Louisville & Nashville R.R. Co., 597 F.2d at 471 (citing Southern Ry. Co. v. Louisville & Nashville R.R. Co., 241 Ala. 691, 4 So.2d 400, 405-406 (1941)). 2012 Id. at 472. 2013 Id. at 474.
400 Southern Railway only granted L&N the right to use Southern Railwayâs bridge.2014 The court held that the agreement did not convey an interest in real property; that the right under the agreement to use the bridge was not permanent; and that L&N did have a joint duty with Southern Railway to maintain the tracks on the bridge.2015 Furthermore, L&N suffered only the âloss of an economic expectancy,â not a âproprietary loss.â2016 Thus, the Fifth Circuit affirmed the district courtâs grant of a summary judgment for the tugboat and its owner.2017 11. Liability for Damage to a Railroad Bridge during Hurricane Katrina In BNSF Ry. Co. v. Parker Drilling Offshore USA LLC,2018 prior to the arrival of Hurricane Katrina, the Browning Oil Company (Browning Oil) was attempting to move a rig to Amelia, Louisiana; however, because the operator was not at his post Browning Oil could not move the rig past the Bayou Boeuf Railroad Bridge.2019 Therefore, the company secured the rig to a nearby dock.2020 However, during the hurricane the rig struck the bridge.2021 Although Browning operated the rig, Parker Drilling Offshore U.S.A. L.L.C. (Parker) owned the rig.2022 After BNSF brought an action brought a suit against Parker, Parker cross-claimed against 2014 Id. at 471. 2015 Id. at 473. 2016 Id. at 474. 2017 Id. 2018 332 Fed. Appx. 986 (5th Cir. 2009). 2019 Id. at 986. 2020 Id. 2021 Id. 2022 Id.
401 Browning Oil under the indemnification clause in their contract.2023 The court affirmed a summary judgment for Browning Oil on the claim by Parker under the contract for indemnification.2024 12. Whether a Railroadâs Operating Agreement with Amtrak was a Valid Prior Cost Allocation Agreement divesting the Public Utility Commission of Jurisdiction to Allocate Costs In Norfolk Southern Railway Company v. Public Utility Commân2025 Norfolk Southern sought review of a final order of the Pennsylvania Public Utility Commission (PUC) . The PUC denied Norfolk Southernâs exceptions to the decision of a PUC Administrative Law Judge (ALJ) who recommended that Norfolk Southern be allocated fifteen percent of the final cost of a bridge removal project at a railroad-highway crossing.2026 Norfolk Southern argued that the PUC erred in determining that Norfolkâs Operating Agreement with Amtrak, pursuant to which Norfolk operates on Amtrakâs rail line at the crossing, did not constitute a valid private cost allocation agreement as contemplated by 66 Pa. C.S. § 2704(a), which would divest the PUC of jurisdiction to allocate Norfolk any costs for the Bridge removal.2027 However, for several reasons the Operating Agreement (OA) did not qualify as a private cost allocation agreement, in part, because other interested parties were not parties to the OA.2028 As for Amtrak, it âis exempt under federal law from a cost allocation for the actual Bridge removal,â and âit cannot be implied that Amtrak, in executing the Operating Agreement with 2023 Id. 2024 Id. at 987. 2025 Norfolk Southern Railway Company, 2014 Pa. Commw. Unpub. LEXIS 233 (Pa. Commw. Ct. 2014). 2026 Id. at *1. 2027 Id. at *12. 2028 Id. at *19.
402 Norfolk, intended to pay for the Bridge removal.â2029 Thus, the PUC was not precluded from allocating costs of the bridge removal project to Norfolk Southern.2030 Article 13. State Public Utility Commission Authority to Allocate the Expense of Bridge Repair to a Railroad A law review article discusses Wheeling & Lake Erie Ry. Co. v. Pennsylvania Public Utility Commân2031 and preemption by the ICCTA of the jurisdiction of the Pennsylvania Public Utility Commission (PUC).2032 In an action in a Pennsylvania state court the issue was the allocation to the railroad of the expense of bridge repair. As the article notes, the ICCTA granted jurisdiction to the STB over railroad companies as common carriers.2033 The ICCTA defines a railroad to include âa bridge, car float, lighter, ferry, and intermodal equipment used by or in connection with a railroad.â2034 On the other hand, the Pennsylvania statute granted authority to the PUC to regulate railroads; to determine whether a public utility, municipality, or the state would pay for construction or repairs at a crossing; and to investigate crossings for safety.2035 2029 Id. 2030 Id. at *20. 2031 778 A.2d 785 (Pa. Commw. Ct. 2001). 2032 Tara L. Eberly, âWheeling & Lake Erie Railway Co. v. Pennsylvania Public Utility Commission: Pennsylvania Maintains Police Powers over Railroad Bridge Construction Despite the Interstate Commerce Commission Termination Act of 1995,â 11 Widener J. Pub. L. 191 (2002), hereinafter referred to as âEberly.â 2033 Id. at 195. 2034 49 U.S.C. § 10102(6)(A) (2004). 2035 66 Pa. Cons. Stat. § 2704 (1999).
403 The state court upheld the PUCâs decision that the railroad should repair the bridge at its own expense.2036 Because the ICCTA did not explicitly regulate the safety of railroad crossings, the Act did not preempt the state statute.2037 Finally, the article observes that the ICCTA grants jurisdiction only to the STB on construction.2038 C. Liability for Damage to Other Property Statute 1. Damage to Property Caused by a Railroad A Michigan statute holds railroad companies liable for damage to property âby fire originating from engineâs passing over the road, fires set by company employees by order of the officers of the road, or otherwise originating in the constructing or operating of the railroad.â2039 However, if the railroad company proves that the engine was in good order or that all safety precautions had been taken when working on or building the railroad, the company is not liable for damage caused by fire.2040 Cases 2. Liability for Damage to Private Property Caused by a Railroad Trestle In Irish v. BNSF Ry. Co.2041 the plaintiffs sued BNSF for negligence and nuisance because debris from a storm obstructed a trestle beneath a Burlington Northern Railway Bridge 2036 Id. at 195. 2037 Id. at 196-97. 2038 Id. at 199. 2039 Mich. Comp. Laws § 462.259 (2014). 2040 Id. 2041 674 F.3d 710, 711 (7th Cir. 2012).
404 that caused flood damage to hundreds of nearby homes.2042 A district court held that a Wisconsin statute provided the only remedy for relief from claims for flooding caused by the maintenance of railroad crossings.2043 The statute prohibits the obstruction of water flow when a railroad company builds a track across a drainage area and provides that a landowner may sue in inverse condemnation for damages.2044 However, because the plaintiffs did not comply with the required statutory notice, the court held that the plaintiffs were not entitled to relief.2045 3. Liability of a Railroad for Nuisance and Contamination of Property In Redevelopment Agency of City of Stockton2046 two railroad companies had maintained tracks on a parcel of land contaminated by petroleum. The petroleum originated from a spill at a nearby industrial site. The issue was whether the railroads were liable for the contamination under the law of nuisance or under Californiaâs Polanco Redevelopment Act (Polanco Act) and thus responsible for cleanup costs under the CERCLA-type provision in the Polanco Act.2047 The petroleum was able to migrate onto the property because of âfrench drainsâ that the railroads had installed to remove water from the roadbed. In 1988, the railroads sold their interest in the subject property to the Redevelopment Agency of the City of Stockton (Redevelopment Agency) that planned to develop the property. In 2005, the Redevelopment Agency sued the railroads for its costs to remediate the property and for an injunction requiring 2042 Id. at 712. 2043 Id. at 711-712 (citing Wis. Stat. § 18.87). 2044 Id. at 713 (citing Wis. Stat. § 88.87). 2045 Id. at 712. The Seventh Circuit affirmed the district courtâs decision to dismiss the case because the plaintiffâs argument on appeal was not preserved. Id. at 715-716. 2046 Redevelopment Agency of City of Stockton v. BNSF Railroad Co., 643 F.3d 668, 676 (9th Cir. 2011). 2047 Id. at 671 (citing Cal. Health & Safety Code § 33459, et seq.).
405 the railroads to remediate any remaining contamination.2048 However, the Ninth Circuit held that if the railroads did not create or assist in the creation of a nuisance they could not be held liable unless they acted unreasonably in failing to recognize or stop the nuisance.2049 The court held that the railroads were not liable for creating the nuisance just because they had installed a drain or were in possession of the property.2050 As noted, the California statute uses the definition in CERCLA for the term âresponsible party.â2051 Under CERCLA a responsible party is someone who owned or operated any facility at the time of the disposal of a hazardous substance.2052 Because the sale of the land by the state to the railroads was invalid, and because the railroadsâ easement did not constitute ownership, the court held that the railroads were not owners.2053 There was nothing to suggest that the railroads were operators within the meaning of the term under the state lawâs CERCLA provision.2054 Thus, the railroads were not liable because they were neither owners nor operators under the CERCLA definition incorporated in the state statute.2055 The court reversed the grant of a 2048 Id. at 672. 2049 Id. at 673. 2050 Id. at 675. 2051 Id. at 677. 2052 Id. 2053 Id. at 680 (citing 42 U.S.C. § 9607(a)(2)). 2054 Id. at 679-680. 2055 Id.
406 summary judgment for the Redevelopment Agency and remanded the case for the entry of a summary judgment for the railroads.2056 4. Whether the ICCTA Preempts Tort Claims under State Law for Water Damage Caused by a Railroad In Emerson v. Kansas City S. Ry. Co.2057 adjacent property owners alleged that the Kansas City Southern Railroad Co.âs (KCS) failure to keep a drainage ditch clear of obstructions, debris, and vegetation resulted in the flooding of adjacent property.2058 The district court granted a summary judgment to KCS based on the courtâs holding that the ICCTA preempted the state tort claims.2059 The ICCTA states that ââthe remedies provided under this part with respect to regulation of rail transportation are exclusive and preempt the remedies provided under Federal or State law.ââ2060 The ICCTA defines the term transportation to include the âmovement of passengers or property, or both, by rail, regardless of ownership or an agreement concerning useâ and âservices related to that movement.â2061 Because KCSâs acts were not related to the âmovement of passengers or propertyâ or âservices related to that movement,â the Tenth Circuit held that KCSâs alleged torts did not come within the meaning of the term transportation in the 2056 Id. at 680. 2057 503 F.3d 1126 (10th Cir. 2007), summary judgment denied, Revocable Trust of Charley L. Davis v. Kan. City Southern Ry., 2008 U.S. Dist. LEXIS 39742 (E.D. Okla., May 14, 2008). 2058 Id. at 1128. 2059 Id. at 1127. 2060 Id. at 1129 (quoting 49 U.S.C. § 10501(b)). 2061 Id. (quoting 49 U.S.C. §§ 10102(9)(A)-(B)).
407 ICCTA.2062 Thus, the court held that the ICCTA does not expressly preempt the state tort claims.2063 Although the STB has found that the ICCTAâs preemption clause does not preclude some state actions for damage caused by railroad property,2064 the Tenth Circuit held that a court must analyze the facts to determine whether allowing a remedy for an injury would interfere with railroad transportation.2065 Thus, the Tenth Circuit held that the ICCTA did not expressly preempt the state tort claims for water damage caused by KCS but that the district court had insufficient facts to determine whether the ICCTA impliedly preempted the claims; thus, the district court erred in granting a summary judgment.2066 5. Claim for Gas and Smoke Caused by a Railroad Tunnel In Richards v. Washington Terminal Company2067 a property owner sought damages against a railroad company that built a tunnel and tracks near but not adjoining the plaintiffâs home. The landowner alleged that a vent in the tunnel directed gas and smoke toward and into his house, destroying furniture and other belongings; that his property had depreciated in value after the construction; and that he could not rent the property.2068 Although some claims alleged 2062 Id. at 1130. 2063 Id. 2064 Id. at 1133. 2065 Id. 2066 Id. 2067 233 U.S. 546, 34 S. Ct. 654, 58 L. Ed. 1088 (1914). See City of Monterey v. Del Monte Dunes, 526 U.S. 687, 119 S. Ct. 1624, 143 L. Ed.2d 882 (1999) (concurring and dissenting opinions citing Richards v. Washington Terminal). 2068 Richards, 233 U.S. at 549-550, 34 S. Ct. 654, 58 L. Ed. 1088.
408 the existence of a public nuisance, the Supreme Court held that gas and smoke directed toward and into the plaintiffâs house constituted a private nuisance.2069 Thus, the landowner could recover for the damage caused by the gas and smoke from the tunnel.2070 2069 Id., 233 U.S. at 551-552, 34 S. Ct. 654, 58 L. Ed. 1088. 2070 Id., 233 U.S. at 551, 34 S. Ct. 654, 58 L. Ed. 1088.
409 XVI. DEMONSTRATION PROJECTS OR PROGRAMS A. Introduction The Federal Railroad Administration (FRA) currently is sponsoring the Confidential Close Call Reporting System (C3RS) Demonstration Project. Launched in 2007, the project is designed to improve railroad safety by allowing railroad companies to report close calls without being penalized by the FRA. The term close call refers to an unsafe event that could have resulted in an accident but did not. The Bureau of Transportation Statistics (BTS) will analyze the data with the goal of determining areas of railroad safety that need improvement. To date, only Amtrak, New Jersey Transit, and United Pacificâs North Platte Service Unit in Nebraska are permitted to participate. It should be noted that there may be federal transit demonstration projects as well.2071 The statutes summarized below in sections B and C authorize the Secretary of Transportation to create demonstration projects to improve railroad safety. The articles discussed hereafter in sections D and E focus on the C3RS with the first article addressing the benefits of implementing a close call system and the second article addressing some of the challenges associated with the C3RS demonstration project. 2071 U.S. Dept. of Transportation, Federal Transit Administration, Fact Sheet: Research, Development, Demonstration, and Deployment Projects - Section 5312, available at: http://www.fta.dot.gov/documents/MAP-21_Fact_Sheet_- _Research_Development_Demonstration_and_Deployment_Projects.pdf (last accessed March 31, 2015).
410 Statutes and Regulations B. Section 163 of the Federal-Aid Highway Act of 1973 The Federal-Aid Highway Act of 1973 authorized the Secretary of Transportation to implement demonstration projects to improve safety at railroad-highway crossings.2072 Section 163 of the Act lists many cities in which the Secretary of Transportation was permitted to carry out demonstration projects for the relocation or removal of railroad lines or the construction of overpasses at railroad-highway crossings to improve highway safety.2073 Section 230 required states to identify projects to eliminate hazards at railroad-highway grade crossings for the Safer Roads Demonstration Program but emphasized that funds may not be used to eliminate a hazard.2074 C. Grade Crossings and Railroad Rights of Way The Secretary of Transportation is required by statute to establish demonstration projects to determine whether train accidents would be reduced by using reflective markers and stop or yield signs at railroad grade crossings and speed bumps or rumble strips prior to a crossing.2075 2072 Federal Aid Highway Act of 1973, Pub. L. No. 93-87, §§ 163 and 230, 87 Stat. 250 (1973). See 23 U.S.C. § 130 (2014); § 230 repealed by Federal Aid Highway Act of 1976, P.L. 94-280, §135(c), 90 Stat. 442. 2073 Highway Act of 1973 § 163; 23 U.S.C. § 130 (2014). 2074 Highway Act of 1973 § 230, repealed by Federal Aid Highway Act of 1976, P.L. 94-280, 90 Stat. 442 § 135(c). 2075 49 U.S.C. § 20134(c) (2014).
411 Articles D. Benefits of Using a Confidential Close Call Reporting System The C3RS is funded by the FRA, which is authorized to sponsor projects that would improve railroad safety.2076 A report by the FRA addresses the C3RS Demonstration Project and its importance in reducing railroad accidents.2077 Because the traditional data collected from railroad accidents has decreased because of a decline in the number of accidents, the FRA has placed an emphasis on close call reporting to improve its ability to analyze risks to railroad safety.2078 The article notes the benefits of implementing a close call reporting system and discusses how a similar reporting system is benefiting the railroad industry in the United Kingdom. The benefits of collecting close call data include identifying weaknesses in safety, monitoring changes in safety over time, and revealing conditions not capable of being discovered by examining only reportable incidents.2079 Reportable incidents include incidents at highway-rail grade crossings, rail equipment accidents resulting in damages exceeding the amount of $10,500 in 2014, and certain incidents involving death, injury, or occupational illness.2080 2076 See 49 U.S.C. § 103 (2014), 49 C.F.R. § 225.1 (2014). 2077 Jordan Mutler, âImproving Railroad Safety through Understanding Close Calls,â at 1 (undated), available at: http://www.closecallsrail.org/pubs/closecalls05a.pdf (last accessed March 31, 2015), hereinafter referred to as âMutler.â 2078 Id. 2079 Id. at 4. 2080 49 C.F.R. §§ 225.19(a)-(d) (2014) (primary groups of accidents/incidents). See 79 Fed. Reg. 77397 (Dec. 24, 2014), âMonetary Threshold for Reporting Rail Equipment Accidents/Incidents for Calendar Year 2015,â available at: http://www.gpo.gov/fdsys/pkg/FR-2014-12-24/html/2014-30113.htm (last accessed March 31, 2015).
412 The United Kingdom implemented the Confidential Incident Report and Analysis System (CIRAS) to improve railroad safety.2081 Reports are sent to an independent third party for the removal of all personal identifying information to ensure confidentiality and to encourage individuals to report close calls.2082 CIRAS creates reports that analyze close calls for distribution to the railroad industry so that railroad companies may modify their internal policies to reduce further close calls.2083 E. Challenges to Using a Confidential Close Call Reporting System In âDeveloping an Effective Corrective Action Process: Lessons Learned from Operating a Confidential Close Call Reporting System,â the authors describe the process for the reporting of close calls, discuss challenges associated with the implementation of a C3RS, and offer some solutions.2084 Before agreeing to participate in the C3RS, a peer review team instructs a railroad companyâs staff on how to use the system.2085 When a close call occurs, employees submit a report to a third party who in turn prepares a report for the railroad to use for the purposes of taking corrective action and monitoring its impact.2086 However, at least four challenges have 2081 Mutler, supra note 2077, at 2. 2082 Id. at 5. 2083 Id. at 6. 2084 Jordan Multer, Joyce Ranney, Julie Hile, and Thomas Raslear, âDeveloping an Effective Corrective Action Process: Lessons Learned from Operating a Confidential Close Call Reporting Systemâ (undated), available at: http://www.closecallsrail.org/pubs/Lessons_Learned_From_Operating_A_Confidential_Close_Call_Repo rting_System.pdf (last accessed March 31, 2015). 2085 Id.
413 arisen in using the system: (1) event analysis is slowed by the process of selecting peer review team members and by the large number of members; (2) the loss of individuals who are enthusiastic about the project; (3) the existence of gaps in reports of incidents; and (4) the limiting of analysis to frontline workers and managers.2087 In connection with the above challenges, the authors report, first, that peer review teams are comprised of twelve to twenty-four people who are selected by the FRA leadership and labor unions, a process that is quite time consuming.2088 To increase efficiency the authors recommend limiting the number of members who may attend each meeting as well as reducing the number of individuals on peer review teams.2089 Second, many individuals who were initially involved with the C3RS no longer promote its benefits to others within their company simply because they are no longer employed in a position that involves C3RS.2090 Railroad companies have had difficulty finding new champions of C3RS to encourage employees to report on and extol the benefits of the system.2091 Third, because the reports only provide a reporterâs perspective rather than the views of everyone involved or present at an event, close call reports contain gaps in explaining the events, 2092 Moreover, one who is reporting on an incident may not know why an event 2086 Id. 2087 Id. 2088 Id. 2089 Id. 2090 Id. 2091 Id. 2092 Id.
414 occurred, or a third party creating a report may miss important information.2093 Finally, it is said that some members of peer review teams have limited knowledge of railroad operations.2094 That is, a team may not be familiar with all areas of railroad operations, a situation that may lead a team to identify only those unsafe conditions with which they are familiar.2095 Nevertheless, the authors conclude that the system is worthwhile because it is capable of improving and adapting to challenges.2096 2093 Id. 2094 Id. 2095 Id. 2096 Id.
415 XVII. EASEMENTS AND INTERPRETATION OF RAILROAD DEEDS A. Introduction As discussed in part I of the Report, federal law governs a railroadâs abandonment of a right of way or discontinuance of service. Except under the circumstances discussed in part I of the Report, assuming that a railroad does not own the property used for a rail line in fee simple absolute,2097 â[t]he abandonment of a railroad right-of-way for railroad purposes results in the termination of the [railroadâs] easementâ2098 with the disposition of a railroad easement or right of way being governed by state law. Part B discusses whether a railroad easement reverts to the original owner or the said ownerâs successor-in-interest of the property.2099 Part C discusses state law, for example, in California, Iowa, Indiana, Maine, North Carolina, and South Dakota on whether an adjoining landowner has a right to an abandoned railroad right of way. Part D summarizes cases holding that a deed conveying a right of way conveyed an easement rather than an interest in fee simple, that there is a presumption that a deed conveys only an easement, that the courts rely on the 2097 See Stone v. U.S.D. No. 222, 278 Kan. 166, 171, 91 P.3d 1194, 1198 (2004) (stating, however, that âin Kansas, railroads take only an easement in strips taken for railroad right-of-ways regardless of whether taken by condemnation or deedâ and that â[u]pon abandonment, the strip reverts back to the original landownersâ). 2098 Diaz v. Home Fed. S&L Assân, 337 Ill. App.3d 722, 731, 86 N.E.2d 1033 (Ill. App. 2002), appeal denied, 204 Ill.2d 658, 792 N.E.2d 306, 1043 (2003). 2099 Anna F. Nordhus Family Trust v. United States, 98 Fed. Cl. 331, 336 (2011) (stating that âthe Court must examine under Kansas law whether the railroad easement would have been extinguished if not for the application of the Trails Act, and whether a new easement for recreational trails has been imposedâ). See also, Lucas v. Township of Bethel, 319 F.3d 595 (3d Cir. 2003) (state property law controlling) (citation omitted); Haggart v. United States, 89 Fed. Cl. 523 (2009) (stating that if the STB âapproves a standard abandonment application or grants an exemption and the railroad ceases operation, the [Board] relinquishes jurisdiction over the abandoned railroad right-of-way and state law reversionary property interests, if any, take effectâ) (citations omitted).
416 terms of a deed to construe its intent to convey an easement or a fee simple interest, and that some courts rely on additional factors to differentiate between the grant of an easement or of a fee simple interest. Sections E and F, respectively, summarize cases on what is meant by the term right of way, whether a railroad is permitted to lease the subsurface of its right of way for non-railroad purposes, and whether a railroad has a right to exclude others from its right of way. Section G summarizes an article on whether a railroad has authority to repurpose a right of way for another use. Finally, section H discusses the issue of compensation for landowners when a railroad right of way is used by telecommunication companies. Case B. Whether an Original Grantor or Successor-in-Interest has a Right of Reversion to an Abandoned Railroad Right of Way In Stone v. U.S.D. No. 2222100 the issue was whether an abandoned railroad right of way was owned by the Stones, the successors-in-interest to the original grantors of the land at issue that was also adjacent to the Stonesâ property. In 1883 the Littles conveyed the real estate at issue to the Chicago Iowa and Kansas Railroad Company by a warranty deed. After the railroad conveyed part of the real estate, the remaining property was used for a railroad for over 100 years before the line was abandoned. The original railroadâs successor-in-interest conveyed the property to the Burlington Northern Railroad Company which conveyed the property in 1986 to a school district. The plaintiffs argued that the property reverted to them because the first railroad had obtained only an easement for railroad purposes.2101 The district court held that âthat the deeds in the chain of title showed that the property was acquired by the predecessor 2100 278 Kan. 166, 91 P.3d 1194 (2004). 2101 Id., 278 Kan. at 169-170, 91 P.3d at 1197.
417 railroad for railroad purposes (construction and maintenance)[] and that the railroad held a right- of-way only because of the use for which the property was acquired.â2102 The Court of Appeals affirmed the district courtâs grant of a summary judgment for the Stones, but the Supreme Court of Kansas reversed. The court held that the determining factor was the language in the original deed, not the use to which the property had been put.2103 The right of way did not revert to the Stones as successors-in-interest to the original grantors because âthe language of the original deed is void of any use restrictions ⦠designating the land for use as a right-of-way or for other railroad purposesâ¦.â2104 Furthermore, â[w]hen the language of the original warranty deed conveying land in fee simple absolute is unambiguous, courts thus may not use parol evidence to determine whether the land was conveyed for right-of-way purposes.â2105 If the original deed to the property had shown that it was conveyed for railroad right of way purposes, the Kansas judicial decisions would have supported the Stonesâ argument âthat upon abandonment of the right-of-way use, the property reverted to the original owners and their successors in interest.â2106 However, in this case â[t]he original unambiguous deed did not contain any use restriction or reversion clause and, thus, granted the railroad title to the land in fee simple absolute.â2107 2102 Id. 2103 Id., 278 Kan. at 179, 91 P.3d at 1203. 2104 Id. (citation omitted). 2105 Id., 278 Kan. at 180, 91 P.3d at 1203. 2106 Id., 278 Kan. at 173, 91 P.3d at 1199. 2107 Id., 278 Kan. at 181-182, 91 P.3d at 1204.
418 Statutes C. State Law on Whether an Adjoining Landowner has a Right to an Abandoned Right of Way 1. California California courts have held that the rules that apply to a highway or stream apply to a railroad right of way.2108 In California â[a] transfer of land, bounded by a highway, passes the title of the person whose estate is transferred to the soil of the highway in front to the center thereof, unless a different intent appears from the grant.â2109 Although â[a]n owner of land bounded by a road or street is presumed to own to the center of the way, ⦠the contrary may be shown.â2110 2. Iowa An Iowa statute provides that âproperty shall pass to the owners of the adjacent property at the time of abandonment. If there are different owners on either side, each owner will take to the center of the right-of-way.â2111 A property owner may perfect title by filing an affidavit with the county recorder and paying taxes on the property from the date the affidavit was filed.2112 The statute also provides that â[u]tility facilities located on abandoned railroad right-of-way shall 2108 See Freeman v. Affiliated Property Craftsmen, 266 Cal. App.2d 723, 730, 72 Cal. Rptr. 357, 364-365 (1968). 2109 Cal. Civ. Code § 1112 (2014). 2110 Cal. Civ. Code § 831 (2014). 2111 Iowa Code § 327G.77(1) (2014). 2112 Iowa Code § 327G.77(2) (2014).
419 remain on the right-of-way subject to payment by the utility of the fair market value of an easement for the facilities.â2113 3. Indiana An Indiana statute applies when âa railroad does not own the right-of-way fee.â2114 First, when âa railroad abandons its right to a railroad right-of-way, the railroadâs interest vests in the owner of the right-of-way fee with a deed that contains a description of the real property that includes the right-of-way.â2115 Second, however, when âa deed described in subsection (b) does not exist, then the railroadâs interest vests in the owner of the adjoining fee. The interest of the railroad that vests in the owner of the adjoining fee is for the part of the right-of-way from the center line of the right-of-way to the adjoining property line.â2116 4. Maine Maine has several statutes that are pertinent to the acquisition of a railroadâs abandoned right of way, including a statute that prohibits a taking of railroad property by adverse possession.2117 Under 23 M.R.S.A. § 7105, Maineâs Department of Transportation is authorized to lease or purchase certain railroad lines that have been authorized to be abandoned. The statute provides that [i]f the department finds that the welfare of the State would be significantly and adversely affected by the loss of the line for railroad transportation purposes, the 2113 Iowa Code § 327G.77(3) (2014). 2114 Ind. Code Ann. § 32-23-11-10(a) (2014). 2115 Ind. Code Ann. § 32-23-11-10(b) (2014). 2116 Ind. Code Ann. § 32-23-11-10(c) (2014). 2117 23 M.R.S.A. § 6025 (2014) (âNo title to any real estate or any interest in real estate may be acquired against any railroad corporation by adverse possession, however exclusive or long continued.â)
420 department shall seek to negotiate the purchase of the abandoned portion of the line. In making this determination, the department shall consider, among other criteria considered significant by the department, future economic development activities and opportunities in the area served by the abandoned railroad service.2118 Furthermore, in Maine [n]o railroad or railroad company may discontinue service to any point served prior to January 1, 1982, unless the railroad or railway company has filed with the Department of Transportation and with any municipality affected by the discontinuance of service and, in the case where service is discontinued solely to one shipper, with that shipper, a written notice of intention to discontinue that service.2119 In Maine, railroads are treated differently than roads. Under 23 M.R.S.A. § 3026(1), [a] municipality may terminate in whole or in part any interests held by it for highway purposes. A municipality may discontinue a town way or public easement after the municipal officers have given best practicable notice to all abutting property owners and the municipal planning board or office and have filed an order of discontinuance with the municipal clerk that specifies the location of the way, the names of abutting property owners and the amount of damages, if any, determined by the municipal officers to be paid to each abutter. Upon approval of the discontinuance order by the legislative body, and unless otherwise stated in the order, a public easement shall, in the case of town ways, be retained and all remaining interests of the municipality shall pass to the abutting property owners to the center of the way. For purposes of this section, the words âpublic easementâ shall include, without limitation, an easement for public utility facilities necessary to provide service. In a case decided by the Supreme Court of Maine, Stuart v. Fox,2120 the primary issue was who could claim the westerly half of an abandoned railway line. The plaintiffs argued that the fee that had been conveyed to them extended to the center of the railroad property, whereas 2118 23 M.R.S.A. § 7105(3)(A) (2014). 2119 23 M.R.S.A. § 5144 (2014). 2120 129 Me. 407, 152 A. 413 (1930), appeal dismissed by 284 U.S. 572, 52 S. Ct. 15, 76 L. Ed. 498 (1931).
421 the defendants argued that the âtitle to the fee in this strip was retained by the grantors when the land on each side was conveyed.â 2121 The plaintiffs argued that âthe same rule which applies in the case of land bounded on a highway should apply to that adjoining a railroad.â2122 The court explained that [c]ourts have attempted to justify the presumption that title to land bounded on a highway extends to the center of the way on the theory that the grantor could not have intended to retain the ownership in a long narrow strip of land of no apparent benefit to himself. This is undoubtedly a consideration which should be given weight, but looking at the principle in its early origin, it seems to be of even greater moment that the grantor should not be presumed to retain for himself that which is of distinct benefit to his grantee in connection with the proper use and enjoyment of the estate conveyed.2123 However, the court decided that what âin the long run will do justice, is to rely on the language used by the parties interpreted in the light of established rules.â2124 The court distinguished railroads from highways, stating that â[t]he land owner beside the railroad has no use whatsoever of the railroad way. In fact he is absolutely excluded from it. The use of it by the railroad is altogether inconsistent with the idea that it could in any way be of advantage to his adjoining land.â2125 The court held that âthe language used by the parties clearly excluded the railroad right of way. To hold otherwise would do violence to accepted rules for the interpretation of deeds.â2126 2121 Id., 129 Me. at 413, 152 A. at 414. 2122 Id., 129 Me. at 410, 152 A. at 414. 2123 Id., 129 Me. at 411, 152 A. at 415. 2124 Id., 129 Me. at 419, 152 A. at 418. 2125 Id., 129 Me. at 418, 152 A. at 418. 2126 Id., 129 Me. at 420, 152 A. at 419.
422 5. North Carolina A North Carolina statute provides: Whenever a railroad abandons a railroad easement, all right, title and interest in the strip, piece or parcel of land constituting the abandoned easement shall be presumed to be vested in those persons, firms or corporations owning lots or parcels of land adjacent to the abandoned easement, with the presumptive ownership of each adjacent landowner extending to the centerline of the abandoned easement.2127 6. South Dakota A South Dakota statute states: A railroad which abandons service over, salvages and removes its rail, ties and other track material from any right-of-way in which it claims any right, title or interest in public lands ⦠shall settle title claims with adjoining landowners and municipalities within one year after salvage of the abandoned road is complete or title to the abandoned railroad right-of-way easement reverts and vests, by operation of law.2128 Cases D. Whether a Deed Conveying a Right of Way is a Conveyance of an Easement or a Fee Simple Interest 1. Presumption that a Deed Conveys only an Easement In Baltimore County v. AT&T Corp.,2129 a multi-district litigation in Indiana, an Indiana federal district court held that under applicable Maryland law (relevant to AT&Tâs motions) when a deed granted a right of way to a railroad the deed conveyed only an easement because the deed evinced no intention of conveying a fee simple interest. For a deed to convey a right of 2127 N.C. Gen. Stat. Ann. § 1-44.2(a) (2014) (emphasis supplied). 2128 S.D. Codified Laws § 49-16A-115 (2014). 2129 735 F. Supp.2d 1063 (S.D. Ind. 2010).
423 way in fee simple there must be evidence of the grantorâs intention to convey a fee simple interest to overcome the presumption that the intent was to convey only an easement.2130 2. Significance of Language in a Deed Indicating Conveyance of an Easement In Dale Henderson Logging, Inc. v. Department of Transportation,2131 involving two consolidated cases, Dale Henderson Logging, Inc. (DHL) and Oak Leaf Realty, Inc. (OLR) owned property over which there was a rail corridor once owned by the Maine Central Railroad Company (Maine Central). The plaintiffs sought, inter alia, a declaration that Maine Central held only a railroad easement that it had abandoned when it later conveyed its interest to the state transportation department. The plaintiffs argued that the transportation department owned nothing and that the plaintiffs owned the corridor in fee simple that traversed part of their property.2132 For different reasons, the Supreme Judicial Court of Maine held that the property owners did not now own the corridor in fee simple. As for the DHL claim to a portion of the corridor, now used as part of the Down East Sunrise Trail, the issue was whether the deeds in favor of Maine Central and its predecessor-in-title conveyed a right of way as an easement or in fee simple. The Maine Short Form Deeds Act (SFDA) that applied to the deeds in question provided that ââ[a] conveyance or reservation of real estate, whether made before or after the effective date of this section, must be construed to convey or reserve an estate in fee simple, unless a different 2130 Id. 1071. 2131 2012 ME 99, 48 A.3d 233 (2012). 2132 Id., 2012 ME 99, *P1-3, 48 A.3d at 234.
424 intention clearly appears in the deed.ââ2133 The court agreed with the trial court that âthe only reason to insert the restriction â[t]his conveyance of right of way is for Railroad purposes onlyâ is to make clear that a fee interest is not what the deed conveys.â2134 Thus, the state transportation department held an interest in the corridor that crossed the DHL property, an easement as discussed below that was not abandoned by Maine Central. As for the OLR property, the condition in the deeds that had been given by DHLâs predecessors-in-title was not present in the deeds to the OLR property; therefore, OLRâs predecessors-in-title granted a fee simple interest to Maine Centralâs predecessor-in-title, property that was now owed in fee simple by the DOT after Maine Centralâs conveyance to the state. The court rejected DHLâs additional argument that the railroad easement to the corridor on its property had been abandoned prior to the stateâs acquisition of Maine Centralâs interest. The court held that the language in 23 M.R.S.A. § 4207(3) was dispositive: âThe abandonment of service shall not mean or infer that the rights-of-way on a railroad line have been abandoned. In the event that the railroad, any person, firm or corporation, or any agency shows interest in the eventual restoration of service, the rights-of-way shall not be deemed abandoned.â2135 The record established to the courtâs satisfaction that the state transportation department has held the easement for âfuture railroad usesâ2136 and that âthe Legislature has indicated that the ultimate 2133 Id., 2012 ME 99, *P12, 48 A.3d at 236 (quoting 33 M.R.S. § 772(1)). 2134 Id., 2012 ME 99, *P13, 48 A.3d at 236-237. 2135 Id., 2012 ME 99, *P17, 48 A.3d at 238. 2136 Id., 2012 ME 99, *20, 48 A.3d at 238 (quoting 23 M.R.S.A. § 4207(3)(C); 23 M.R.S. § 7105(3)(C) (2011)).
425 purpose of the corridor remains the resumption of rail service.â2137 The court affirmed the trial courtâs decision that the âDOT holds an easement that has not been abandoned [to the DHL] portion of the corridor[] and owns the fee simple portion of the [OLR] corridor.â2138 3. Judicial Factors used to Differentiate between the Grant of an Easement or an Interest in Fee Simple In Beres v. United States2139 the United States Court of Federal Claims had to interpret the meaning of the term right of way under the law of the state of Washington. In Beres, when the government denied them a reversionary interest in a right of way on their properties, the plaintiffs brought an action for a taking of their property under the Fifth Amendment.2140 In brief, the Seattle, Lake Shore & Eastern Railway Company (SLS&E) had constructed the rail line in question between May 1887 and March 1888. During May and June 1887, the SLS&E acquired land needed to construct the railroad along the eastern shore of Lake Sammamish by right of way deeds from the plaintiffsâ predecessors-in-title.2141 The court stated that under Washington law â[t]he interpretation of a right of way deed is a mixed question of fact and law. Determining the partiesâ intent is a factual question and the courts must look to the entire document in order to ascertain such intent.â2142 However, â[t]he majority of railroad right of way cases decided by the State of Washington Supreme Court ⦠have indicated that the 2137 Id., 2012 ME 99, *P21, 48 A.3d at 239. 2138 Id., 2012 ME 99, *P3, *P28, 48 A.3d at 234, 241. 2139 97 Fed. Cl. 757 (Fed. Cl. 2011). 2140 Id. at 764-765. 2141 Id. at 759. 2142 Id. at 780.
426 phrase âright of wayâ in railroad grants is indicative of conveying an easement and not a fee simple interest.â2143 To determine whether the deeds at issue that conveyed a right of way conveyed an easement or an interest in fee simple, the court applied factors previously established in Brown v. State:2144 (1) whether the deed conveyed a strip of land, and did not contain additional language relating to the use or purpose to which the land was to be put, or in other ways limiting the estate conveyed; (2) whether the deed conveyed a strip of land and limited its use to a specific purpose; (3) whether the deed conveyed a right of way over a tract of land, rather than a strip thereof; (4) whether the deed granted only the privilege of constructing, operating, or maintaining a railroad over the land; (5) whether the deed contained a clause providing that if the railroad ceased to operate, the land conveyed would revert to the grantor; (6) whether the consideration expressed was substantial or nominal; and (7) whether the conveyance did or did not contain a habendum clause, and many other considerations suggested by the language of the particular deed.2145 Additionally, the Brown court stated that it had to look at âthe circumstances surrounding the deedâs execution and the subsequent conduct of the parties.â2146 The Beres court held that all grantors of the SLS&E deeds, including a 1904 quit claim deed, had conveyed easements, not interests in fee, to the railroad. The courtâs ruling meant that the plaintiffs could proceed with their claims for a Fifth Amendment taking.2147 2143 Id. at 779. 2144 Brown v. State, 130 Wn.2d 430, 924 P.2d 908 (Wash. 1996). 2145 Beres, 97 Fed. Cl. at 774. 2146 Id. at 774-775 (citation omitted). 2147 Id. at 809.
427 E. Meaning of the Term Right of Way 1. A Right of Way as a Strip of Land on which Railroad Companies Construct a Road-Bed In 1891 in Joy v. City of St. Louis2148 the United States Supreme Court interpreted the term right of way. The Court stated that the term right of way âsometimes is used to describe a right belonging to a party, a right of passage over any tract; and it is also used to describe that strip of land which railroad companies take upon which to construct their road-bed.â2149 The Court held that in every instance that the term was used the term referred to a strip of land rather than to a right to cross over the land.2150 The Court explained that â[a] right of way is of no practical use to a railroad without a superstructure and rails. The track is a necessary incident to the enjoyment of the right of way.â2151 The Court, which gave effect to the partiesâ intention, held that an alternative definition would have defeated the purpose in granting the right of way.2152 2. Right to Lease the Subsurface for a Non-Railroad Purpose not included in a Railroadâs Right of Way A more recent case, Union Pacific Railroad Co. v. Santa Fe Pacific Pipelines, Inc.,2153 arose out of a dispute over whether Santa Fe Pacific Pipelines (SFPP) was required to pay rent to 2148 138 U.S. 1, 11 S. Ct. 243, 34 L.E. 843 (1891). 2149 Id., 138 U.S. at 44, 11 S. Ct. at 256, 34 L. Ed. 857. 2150 Id. 2151 Id., 138 U.S. at 45, 11 S. Ct. at 256, 34 L. Ed. at 858. 2152 Id. 2153 2014 Cal. App. LEXIS 1007, at *1 (Cal. Dist. Ct. App. 2014).
428 Union Pacific Railroad Company for subterranean use of railroad property.2154 The court cited several federal and state court cases defining a right of way to determine what the railroadâs property interest was. The court held that Union Pacific did not have the right to collect rent from SFPP based on the acquisition of a right of way under the General Right-of-Way Act of 1875, because the Act did not make âthe subsurface the âproperty of the railroad.ââ2155 The court stated that the previous legislation, referred to in the opinion as the pre-1871 Acts, required railroads to use their rights of way for railroad purposes only; the leasing of the subsurface to generate profits is not a railroad purpose.2156 However, the railroad claimed title to some of the land over which Congress did not grant the railroad a right of way; thus, the court remanded the case to the trial court to determine which land was owned by Union Pacific and which was land over which Union Pacific merely had a right of way.2157 Although Union Pacific could collect rent for easements over its own property, the railroad could not collect rent for the pipelines under its rights of way.2158 The court held that the 1875 Act granted more than a âmereâ easement because â[t]o operate its trains, a railroad needs, and has, more than thatâ¦.â2159 Thus, subterranean rights 2154 Id. at *29-30. 2155 Id. at *47-48. 2156 Id. at *48, 51. The pre-1871 acts include the Pacific Railroad Act of 1862, the Homestead Act, 30 U.S.C. § 21 (1866), and the Pacific Railroad Act of 1864. 2157 Id. at *79. 2158 Id. 2159 Id. at *44-45.
429 were not included as part of the railroad right of way because such rights do not further the purpose of constructing and running a railroad.2160 F. Railroadâs Right to Exclude Others from its Right of Way In Western Union Tel. Co. v. Pennsylvania R. Co.2161 a telegraph company alleged that the railroad had no authority to evict it from certain property. The telegraph company argued that it had the power to take land through the use of eminent domain based on the Act of 18662162 and thus could erect telegraph poles as long as a railroad company was paid just compensation.2163 The Act stated that âany telegraph company now organized, or which may hereafter be organized under the laws of any State in this Union, shall have the right to construct, maintain, and operate lines of telegraph through and over any portion of the public domains of the United States.â2164 The Supreme Court held, however, that the Act did not permit a telegraph company to enter private property and erect structures without the consent of the owner of the property.2165 The court held that â[a] railroad right of way is a very substantial thing. It is more than a mere right of passage. It is more than an easement.â2166 Furthermore, the Court held that 2160 Id. 2161 195 U.S. 540, 25 S. Ct. 133, 49 L. Ed. 312, 318 (1904). 2162 The Act of July 24, 1866, 14 Stat. 211. c. 230 (repealed 1947). 2163 Western Union, 195 U.S. at 559, 25 S. Ct. at 136-137, 49 L. Ed. at 318. 2164 Id., 195 U.S. at 557, 25 S. Ct. at 136, 49 L. Ed. at 318 (quoting the Act of 1866, 14 Stat. 221. c. 230.d). 2165 Id., 195 U.S. at 562, 25 S. Ct. at 138, 49 L. Ed. at 320. 2166 Id., 195 U.S. at 570, 25 S. Ct. at 141, 49 L. Ed. at 323.
430 if a railroadâs right of way was an easement it was one having the attributes of the fee, perpetuity and exclusive use and possession; also the remedies of the fee, and, like it corporeal, not incorporeal, property.... Unlike the use of a private way -- that is, discontinuous -- the use of land condemned by a railroad is perpetual and continuous.... A railroadâs right of way has, therefore, the substantiality of the fee, and it is private property even to the public in all else but an interest and benefit in its uses. It cannot be invaded without guilt of trespass. It cannot be appropriated in whole or in part except upon the payment of compensation.2167 The Supreme Court also noted that New Jersey statutes had not granted the right of eminent domain to telegraph companies.2168 Articles G. Railroadâs Authority to Grant Easements to Utility Companies or Repurpose Land for Another Use An article in the Ecology Law Quarterly discusses how an abandonment of railroad property or a rail line affects utility companies that had a license from a railroad company to lay pipes, cables, or wires on railroad property. The authors discuss a number of class actions in which private landowners have challenged a railroadâs ownership of an abandoned right of way and the right of utility companies to lay fiber optic cables or install utility lines on abandoned railroad property, as well as the governmentâs right to re-purpose abandoned property for use as recreational trails.2169 Property owners have argued that when railroad companies have only an easement for a rail line the railroad companies have no right to permit utility companies to lay pipes, cables, or 2167 Id. (citations omitted). 2168 Id., 195 U.S. at 574, 25 S. Ct. at 142, 49 L. Ed. at 324. 2169 Danaya C. Wright and Jeffery M. Hester, âPipes, Wires, and Bicycles: Rails-to-Trails, Utility Licenses, and the Shifting Scope of Railroad Easements from the Nineteenth to the Twenty-First Centuries,â 27 Ecology L.Q. 352, 352 (2000).
431 wires because such a right is one that only an owner of property in fee simple may convey.2170 Furthermore, landowners have argued that a utilityâs use of a right of way after a railroad has abandoned the right of way is a taking under the Fifth Amendment requiring the United States to pay just compensation because the abandonment returns the property to an unencumbered state.2171 The aforesaid rule applies to a right of way over land previously owned by the United States that was conveyed to a private owner as an easement.2172 It is argued that the term utility is not included in the term railroad purpose in an easement conveyed to a railroad.2173 Furthermore, there is a âgeneral principle that [the] termination of an easement will terminate a sub-easement.â2174 The principle implies that even if a railroad had a right to grant a sub-easement to a utility company any purported sub-easement ceases when a railroad abandons the line.2175 A sub-easement holderâs rights depend on the rights, if any, of the holder of the easement.2176 Some states have addressed the issue by statute. Indiana, South Dakota, and Iowa have enacted laws preserving a utility companyâs sub-easement after abandonment by a railroad but 2170 Id. at 360. 2171 Id. 2172 See id. 2173 Id. at 360-361. 2174 Id. at 438-439. 2175 Id. 2176 Id. at 439.
432 still permit a private landowner to seek compensation for the continued use of the land.2177 The courts could address the issue by invoking the âshifting public use doctrine,â meaning that âpublic easements that are transformed to meet changing technologies, but which arguably retain some character of the original easement, will not be found to be extinguished or abandoned.â2178 In this context, shifting does not mean that the courts have broadened the meaning of what qualifies as or constitutes a public use but refers to the conversion of a railroad corridor reserved for one public use to another public use.2179 The article argues that the shifting public use doctrine permits easements used for one purpose to be converted to another public purpose so as not to result in an abandonment of an easement by the railroad and that property owners accordingly have no claim because a taking would not have occurred.2180 Thus, â[w]hen property has been taken for a public use, and full compensation made for the fee or a perpetual easement, its subsequent appropriation to another public use ... does not require further compensation to the owner.â2181 H. Compensation for Use of Railroad Rights-of-Way by Telecommunication Companies for Line or Cables An article in the Drake Journal of Agricultural Law discusses state constitutional law and the common law on rights of way, as well as several class action suits involving rights of 2177 Id. at 440. 2178 Id. at 441-442. 2179 Id. at 442. 2180 Id. at 442-443. 2181 Id. at 443.
433 way.2182 In the mid to late 1800s, several states such as Indiana amended their constitutions to prevent railroads from abusing their power of eminent domain. The amended constitutions required âprivate utilities, such as railroads, electric utilities, and telecom companiesâ to pay fair value before taking property.2183 The author argues that landowners have learned that âtelecommunications companies have taken and used their land with full knowledge that they had no legal rights to do so.â2184 According to the author, telecommunication companies entered onto land by claiming that they had authority to lay cables with the permission of the railroad companies that held rights-of-way.2185 A 1983 study commissioned by the American Association of Railroads âconcluded that railroad rights-of-way often are limited to surface rights or restricted for railroad purposes;â therefore, telecommunication companies had no legal authority to lay cables on railroad rights- of-way with or without the permission of the railroad companies.2186 The article states that CSXâs chief negotiator for fiber-optic cable testified in a deposition that CSX had no right to authorize telecommunication companies to install fiber-optic cables on railroad rights-of-way.2187 The National Oceanic and Atmospheric Association has reported that the âvalue of the right to install and maintain conduits for fiber optic cables is reasonably estimated [to be] 2182 Nels Ackerson, âRight-of-Way Rights, Wrongs and Remedies Status Report, Emerging Issues, and Opportunities,â 8 Drake J. Agric. L. 177, 179 (2003). 2183 Id. at 180-181. 2184 Id. at 184. 2185 Id. at 184-185. 2186 Id. at 185. 2187 Id.
434 between $40,000 and $100,000 per mile.â2188 In some class action settlements involving AT&T and abandoned railroad rights of way âlandowners have received compensation ranging from $125,700 per mile in Connecticut to $5,300 per mile in Maine, with the average compensation close to $45,000 per mile.â2189 However, the compensation is much less for active railroad rights-of-way and ârange[s] from $13,728 per mile in Connecticut and Virginia to $8,976 per mile in Ohio with the average compensation in excess of $10,500 per mile.â2190 The article lists over twenty cases in which landowners have won class action lawsuits against railroads or telecommunication companies in disputes over compensation for the use of rights-of-way with only four cases having been decided against the landowners.2191 2188 Id. at 191. 2189 Id. 2190 Id. 2191 Id. at 195-198 (citing, e.g., Fritsch v. Interstate Commerce Commission, 59 F.3d 248 (D.C. Cir. 1995) (holding that a new property interest cannot be created in a Right of Way if abandonment has already occurred); Calumet National Bank v. AT&T, 682 N.E.2d 785 (Ind. 1997) (holding the telecommunications company liable for trespass because the easement had extinguished when the railroad abandoned its Right of Way); Schmitt v. United States, 203 F.R.D 387 (S.D. Ind. 2001) (holding that the railroad company acquired an easement for railroad purposes and certifying a class action); In re Telecomm. Providersâ Fiber Optic Cable Installation Litig., 199 F. Supp.2d 1377 (2002) (denying request for class certification)).
435 XVIII. EMINENT DOMAIN AND RAILROADS A. Introduction Many states have extended the right to take private land for public use to certain private companies, including railroads, because the states consider the use of such property to be fundamentally public. Section B discusses condemnation of property by railroads, the requirement that a condemnor pay just compensation for property taken or taken or damaged, limitations on railroadsâ use of eminent domain, and cases finding that the requirement of public use was satisfied in several examples of takings by railroads. Section C discusses the condemnation of property owned by railroads, including the effect of the Interstate Commerce Commission Termination Act (ICCTA), limitations under state law on condemnation of property owned or operated by railroads, and the preemption of a condemnation of railroad property because the taking would interfere with railroad operations. Sections D and E address the nature of the property interest taken in eminent domain actions and the difference between eminent domain and zoning. Section F summarizes cases and an article on the valuation of property and the determination of just compensation in eminent domain cases, as well as whether injunctive relief is available to a property owner in an action in eminent domain. B. Condemnation of Property by Railroads Constitutional Provisions and Statutes 1. Requirement of Just Compensation for Property Taken or Taken or Damaged Most state constitutions and statutes include provisions requiring just compensation for property taken, or taken or damaged, by the state or by local governments for public use. Except as otherwise discussed herein, railroads generally have been granted the same power of eminent
436 domain to take property as states have to condemn property.2192 States, including California,2193 Texas,2194 Pennsylvania,2195 New York,2196 and Virginia2197 have a provision in their state constitutions requiring that the state pay just compensation for a taking of any property for a public use.2198 In Virginia, the state constitution provides in part that â[n]o private property shall be damaged or taken for public use without just compensation to the owner thereof.â2199 As in many other state constitutions, Virginiaâs constitutional provision adds the term âdamaged,â2200 a term not included in the Fifth Amendment to the United States Constitution.2201 A property owner may file an inverse condemnation claim and receive just compensation for a taking under § 8.01-187 of the Virginia 2192 See, e.g., Buck v. District Court for Kiowa Cnty., 199 Colo. 344, 608 P.2d 350 (1980); Chicago, I.&L.R. Co. v. Baugh, 175 Ind. 419, 94 N.E. 571 (1911); Bedford Quarries Co. v. Chicago, 175 Ind. 303 94 N.E. 326 (1911); City of Los Angeles v. Los Angeles Pac. Co., 159 P. 992, 31 Cal. App. 100 (Cal. App. 1916); and F.C. Ayres Mercantile Co. v. Union Pac. R. Co., 16 F.2d 395 (8th Cir. 1926). 2193 Cal. Const., art. 17 § 19. 2194 Tex. Const., art. I § 17. 2195 Pa. Const., art. 1 § 10. 2196 N.Y. Const., art. I § 7. 2197 Va. Const., art. 1 § 11. 2198 For a more comprehensive list of state constitutional provisions on eminent domain, see Castle Coalition, Current State Constitutional Provisions About Eminent Domain, available at: http://www.castlecoalition.org/legislativecenter/185?task=view (last accessed March 31, 2015). 2199 Va. Const., art. 1 § 11. 2200 Id. 2201 U.S. Const. 5th Amend. (stating in part: ânor shall private property be taken for public use, without just compensationâ).
437 Code.2202 2. State Limitations on the Use of Eminent Domain Some states have enacted laws that limit railroadsâ use of eminent domain in the taking of homes or sacred locations. In Maine, state law prohibits railroad companies from taking homes, meetinghouses, or burial grounds without the consent of the landowners.2203 West Virginia similarly provides that railroad companies must obtain the consent of a landowner to âinvade the dwelling houseâ of the landowner or the space sixty feet from the home, unless it is essential to prevent particular problems associated with the construction of the railway, such as having to move through narrow passages, at sharp angles, or on elevations.2204 Cases 3. Satisfaction of the Public Use Requirement In Buck v. District Court for Kiowa County2205 the Supreme Court of Colorado held that the construction of dust levees along the side of railroad tracks enhanced the operational efficiency of the railroad and thus was for a public use and benefit. Therefore, the condemnation of property adjoining the railroad was lawful. 4. Acquiring Land for Railroad Business In Hairston v. Danville & W. R. Co.2206 the United States Supreme Court held that a 2202 Va. Code Ann. § 8.01-187 (2014). 2203 Me. Rev. Stat. Ann. tit. 23 § 6005 (2014). 2204 W. Va. Code § 54-1-4 (2014). See also, Ind. Code Ann. 8-4-10-2 (2014). 2205 199 Colo. 344, 348, 608 P.2d 350, 351-352 (1980). 2206 208 U.S. 598, 608-609, 28 S. Ct. 331, 52 L. Ed. 637 (1908). See also, Kelo v. City of New London, 545 U.S. 469, 482, 125 S. Ct. 2655, 162 L. Ed.2d 439 (2005); United States ex rel. Tennessee Valley
438 railroad could validly exercise the right of eminent domain to obtain property for the purpose of handling railroad business with nearby industrial or similar plants. 5. Takings by Railroad Companies of Property Adjoining a Railroad for Ancillary Uses or Spur Tracks States have permitted railroad companies to take adjoining property through eminent domain for ancillary uses or for spur tracks.2207 The courts generally have held that such takings are for a public use pursuant to the Fifth Amendment, state constitutional provisions, and case law. 6. Tracks Connecting the Railroad with a Private Business In Hughes v. Consol-Pennsylvania Coal Co.2208 the Third Circuit held that a railroad company had the right to condemn land for the purpose of connecting a private coal mine with its railway. The railroad contracted with the coal mine company to acquire land in its name that would be used to build a spur track connecting the coal mine with the rail line; the railroad agreed to the transfer the land to the coal mine via a trust.2209 Brokers for the railroad induced property owners to sell land to the railroad, threatening that the railroad could condemn the properties if the owners did not agree to sell.2210 When the property owners learned of the arrangement between the coal mine and the Authority v. Welch, 327 U.S. 546, 552, 66 S. Ct. 715, 90 L. Ed. 843 (1946); and Alton R. Co. v. Illinois Commerce Com., 305 U.S. 548, 553, 59 S. Ct. 340, 83 L. Ed. 344 (1939) (all citing Hairston). 2207 See, e.g., Union Lime Co. v. Chicago & Northwestern R. Co., 233 U.S. 211, 34 S. Ct. 522, 58 L. Ed. 924 (1914); Hairston v. Danville & W. R. Co., 208 U.S. 598, 28 S. Ct. 331, 52 L. Ed. 637 (1908); Hughes v. Consol-Pennsylvania Coal Co., 945 F.2d 594 (3d Cir. 1991); McCarthy v. Bloedel Donovan Lumber Mills, 39 F.2d 34 (9th Cir. 1930). 2208 945 F.2d 594 (3d Cir. 1991). 2209 Id. at 607. 2210 Id. at 608.
439 railroad company and brought suit against the railroad in Pennsylvania, they alleged that the brokers employed by the railroad misrepresented the railroadâs condemnation powers to enable the railroad to obtain the properties at more favorable prices.2211 The property owners argued that the condemnation did not meet the public use requirement because the spur track only connected to a private coal mine.2212 Furthermore, they argued that the spur track did not have the approval of the ICC and that the track was not part of the railroadâs chartered area.2213 Rejecting the plaintiffsâ arguments, the Third Circuit held that the railroad had the authority to condemn the property at issue but remanded the case on the issues of fraudulent misrepresentation, conspiracy, and racketeering.2214 7. Spur Tracks for Private Railroads In McCarthy v. Bloedel Donovan Lumber Mills,2215 a private railroad, not a common carrier, condemned land to acquire a right of way to add a spur between its existing logging railroad and timberland that the railroad owned. The defendant argued that it had the authority to condemn the land for a right of way under chapter 133 of the Washington Laws 1913, Remingtonâs Comp. Stat. 1922, §§ 6747-6749, which required that the company only take right of ways that were ânecessary.â2216 The court looked to a previous Washington state case that 2211 Id. 2212 Id. at 612. 2213 Id. 2214 Id. at 613. 2215 39 F.2d 34 (9th Cir. 1930). 2216 Id. at 35.
440 defined ânecessaryâ as ânot ⦠an absolute and unconditional necessity, as determined by physical causes, but a reasonable necessity, under the circumstances of the particular case, dependent upon the practicability of another route ⦠considered in connection with the relative cost to one, and probable injury to the other.2217 The Ninth Circuit held that the taking was an appropriate exercise of the power of eminent domain because the evidence established that the spur to connect the logging holding areas with the railroad qualified as ânecessaryâ for a right of way under the statute.2218 Other courts have held that railroads may take property adjoining the rails for other ancillary uses including stock pens,2219 sidings and lateral railroads,2220 and poles for power lines for electric railroads,2221 as well as spur tracks.2222 C. Condemnation of Railroad Property Statutes 1. Interstate Commerce Commission Termination Act The Interstate Commerce Commission Termination Act (ICCTA), enacted in 1995, may preempt condemnation of railroad property by state or local governments.2223 The ICCTA 2217 Id. (quoting Samish River Boom Co. v. Union Boom Co., 32 Wash. 586, 601, 73 P. 670, 673 (1903)). 2218 Id. at 34, 36-37. 2219 Chicago, I. & L.R. Co. v. Baugh, 175 Ind. 419, 94 N.E. 571 (1911). 2220 Bedford Quarries Co. v. Chicago, 175 Ind. 303, 94 N.E. 326 (1911) (building sidetrack by railroad company to land containing building stone); Westport Stone Co. v. Thomas, 175 Ind. 319, 94 N.E. 406 (1911) (lateral railroad to be built by a stone quarry as public use). 2221 City of Los Angeles v. Los Angeles Pac. Co., 31 Cal. App. 100, 159 P. 992 (Cal. App. 1916). 2222 F.C. Ayres Mercantile Co. v. Union Pac. R. Co., 16 F.2d 395 (8th Cir. 1926); Ozark Coal Co. v. Pennsylvania Anthracite R. Co., 97 Ark. 495, 134 S.W. 634 (1911). 2223 49 U.S.C. § 10501 (2014).
441 created the Surface Transportation Board (STB) and gave it jurisdiction over transportation by rail carriers.2224 Furthermore, the STB has exclusive jurisdiction over âthe construction, acquisition, operation, abandonment or discontinuanceâ of rail tracks âeven if the tracks are located, or intended to be located, entirely in one State.â2225 Therefore, the ICCTA preempts any state or local regulation that would interfere with the STBâs exclusive jurisdiction over a railroadâs operation and construction. The ICCTA did not intend to preempt all state eminent domain actions; preemption is determined on an âas appliedâ basis rather than âcategorically.â2226 To distinguish between the two types of preemption, the Seventh Circuit has explained: Categorical preemption occurs when a state or local action is preempted on its face despite its context or rationale. If an action is not categorically preempted, it may be preempted âas appliedâ based on the degree of interference that the particular action has on railroad transportation â this occurs when the facts show that the action âwould have the effect of preventing or unreasonably interfering with railroad transportation.â2227 Therefore, to determine whether the ICCTA preempts a state or local regulation, including condemnation of railroad property, courts assess whether the regulation at issue would âprevent[] or unreasonably interfer[e]â with railroad transportation.2228 2224 49 U.S.C. § 10501(a) (2014). 2225 49 U.S.C. § 10501(b) (2014). 2226 Union Pac. R.R. v. Chicago Transit Auth., 647 F.3d 675, 680 (7th Cir. 2011). 2227 Id. at 679 (citing CSX Transp., Inc.âPetition for Declaratory Order, STB Finance Docket No. 34662, 2005 STB LEXIS 675, at *2-3 (S.T.B. May 3, 2005)). 2228 Id. See also, Emerson v. Kansas City S. Ry. Co., 503 F.3d 1126 (10th Cir. 2007); Minnesota Department of Transportation, Federal Laws Applicable to Railroads, available at: http://www.dot.state.mn.us/frac/PDF/landusereg.pdf (last accessed March 31, 2015).
442 2. State Limitations on Condemnation of Property Owned or Operated by Railroads In some states the condemnation of railroad property differs from other types of condemnations of property.2229 Many states have statutes that govern the exercise of eminent domain with respect to railroad property.2230 State legislatures frequently permit the state or public utility companies to condemn land owned or operated by railroads for use in establishing telephone lines or other public utilities.2231 For example, laws in California,2232 Oregon,2233 Oklahoma,2234 and Georgia2235 permit the state to acquire a right of way over railroad property but not to interfere with the railroadâs operation. 3. Statutory Provisions in Oregon Oregon is an example of a state with statutory provisions pursuant to which the state may âlocate, relocate, or constructâ a highway on a railroadâs right of way when necessary for the construction of highways.2236 Another Oregon statute authorizes the state to acquire a right of 2229 See, e.g., Ga. Code Ann. § 46-5-1(a)(4) (2014); Okla. Stat. tit. 69 § 1722 (2014); Or. Rev. Stat. §§ 366.335(3) and 368.116 (2014). 2230 Id. 2231 See, e.g., Cal. Pub. Util. §§ 7557, et seq. (2014) and 90402 (2014). Claims may be brought under state law challenging utility companiesâ ability to use or condemn railroad property. Davis v. Williams Communications, Inc., 258 F. Supp.2d 1348 (N.D. Ga. 2003) (citing Ga. Code Ann. § 46-5-1(a)(4) 2003)); Multnomah County v. Union Pacific Railroad Co., 297 Ore. 341, 685 P.2d 988 (1984) (citing Or. Rev. Stat. § 368.116 (1983)). 2232 Ca. Pub. Util. §§ 7557 and 90402 (2014). 2233 Or. Rev. Stat. §§ 366.335(3) and 368.116 (2014). 2234 Okla. Stat. tit. 69 § 1722 (2014). 2235 Ga. Code Ann. § 46-5-1(a)(4) (2014). 2236 Or. Rev. Stat. § 366.335(1) (2014).
443 way on railroad property when the acquisition is necessary for the construction or location of public roads.2237 The Oregon Department of Transportation (ODOT) may negotiate with a railroad to acquire a right to use or occupy property.2238 However, if ODOT and a railroad are unable to agree the state may commence a condemnation proceeding to acquire the right of way for a highway.2239 The applicable statute also states that it does not authorize any use of land that would interfere with the operation of a railroad.2240 Case 4. Condemnation Preempted that would Interfere with Railroad Operations In Union Pacific Railroad v. Chicago Transit Authority2241 Union Pacific owned a right of way that was used for its own rail operations; the Chicago Transit Authority (CTA) had leased part of the right of way for almost five decades. CTA decided it was too expensive to continue leasing the right of way; thus, CTA attempted to condemn the land to acquire a perpetual easement.2242 Union Pacific argued that the ICCTA preempted CTAâs condemnation of the right of way.2243 CTAâs use of the right of way prevented Union Pacific from using the property for 2237 Or. Rev. Stat. § 368.116 (2014). 2238 Id. 2239 Or. Rev. Stat. § 366.335(2) (2014). 2240 Or. Rev. Stat. § 366.335(3) (2014). 2241 647 F.3d 675 (7th Cir. 2011). 2242 Id. at 676. 2243 Id.
444 additional tracks and affected its operations.2244 Therefore, based on preemption under the ICCTA on an âas appliedâ basis,2245 the Seventh Circuit held that the condemnation was preempted because the condemnation would interfere unreasonably with Union Pacificâs operation.2246 Although Union Pacific could agree to an arrangement by contract that interfered with its operations, the state could not do so through its use of eminent domain.2247 In Reading Blue Mountain & Northern Railroad Co. v. UGI Utilities, Inc.2248 the Reading Blue Mountain & Northern Railroad Co. (RBMN) brought an action to prevent a utility company from drilling on the railroadâs right of way to install a gas pipeline. RBMN argued that the drilling was a taking by the state that was preempted by the ICCTA. The utility company would take only about a 1,200 square foot area for drilling and would not impede the railroadâs normal operations.2249 The court compared BMMNâs claim to Union Pacificâs claim in Union Pacific Railroad v. Chicago Transit Authority,2250 supra, in which the CTA used 40% of the railroadâs right of way.2251 In RBMN, the court denied the railroadâs motion for a preliminary injunction because RBNM was unlikely to be successful on the merits as the ICCTA likely did not preempt 2244 Id. at 682. 2245 Id. at 680. 2246 Id. at 682. 2247 Id. 2248 2012 U.S. Dist. LEXIS 8719, at *1 (M.D. Penn. 2012). 2249 Id. at *6. 2250 647 F.3d 675 (7th Cir. 2011). 2251 Reading Blue Mt. & Northern R.R. Co., 2012 U.S. Dist. LEXIS 8719 at *5-6.
445 the drilling.2252 Cases D. Nature of Property Interest taken in Eminent Domain 1. Narrow Interpretation of a Property Interest Obtained by Eminent Domain Eminent domain is generally a use-based acquisition of land that may result in a company acquiring an easement rather than a fee interest.2253 State law determines the nature of a property interest that is acquired.2254 2. Whether Government retained Reversionary Interest in Public Land it Condemned and Granted to a Railroad In Samuel C. Johnson 1988 Trust v. Bayfield County2255 the Seventh Circuit had to determine whether Bayfield County retained a reversionary interest in land previously held by the government that it obtained by eminent domain. The county claimed that it owned a reversionary interest in undeveloped plots of land owned by a railroad with half being obtained through a land grant and the other half by condemnation.2256 The county argued that it retained a reversionary interest in a land grant from the state of Wisconsin to the railroad for some of the property and that a statute created a reversionary interest in the state of Wisconsin for the remainder of the property that was obtained through condemnation.2257 The court held that the 2252 Id. at *13, 23. 2253 Great Northern R. Co. v. United States, 315 U.S. 262, 62 S. Ct. 529, 86 L. Ed. 836 (1942). 2254 Howard v. United States, 106 Fed. Cl. 343, 367 (2012). 2255 649 F.3d 799 (7th Cir. 2011). 2256 Id. at 801. 2257 Id. at 802.
446 land itself, not an easement, was conveyed outright to the railroad through eminent domain, leaving no reversionary interest.2258 E. Difference between Eminent Domain and Zoning 1. Eminent Domain as an Inalienable Right of Sovereignty Numerous courts have held that the power of eminent domain is superior to local zoning regulations, particularly with respect to railroads.2259 In Forth Worth & D.C. Railway Co. v. Ammons2260 the plaintiff Forth Worth & D.C. Railway Co. (FWDC) wanted to extend an industrial spur line on land it already owned in a residential area.2261 FWDC appealed after the city obtained an injunction that prevented the railroad from constructing the extension because of the areaâs residential zoning.2262 The use of eminent domain and zoning regulations are similar in that they both may be used to promote the use of property in ways that are beneficial to the general welfare. However, the power of eminent domain derives from the statesâ right to appropriate private property, âone of the inalienable rights of sovereignty,â while the power to zone property is based on the statesâ 2258 Id. at 808. 2259 See, e.g., Missouri Pac. R.R. v. 55 Acres of Land, 947 F. Supp. 1301, 1312 (E.D. Ark. 1996); City of Flint v. Chesapeake & Ohio Ry. Co., 464 F. Supp. 423 (E.D. Mich. 1978); Seward Cnty. Board of Commârs v. City of Seward, 196 Neb. 266, 242 N.W.2d 849 (1976); State ex rel. Askew v. Kopp, 330 S.W.2d 882 (Mo. 1960); Fort Worth & D.C. Ry. Co. v. Ammons, 215 S.W.2d 407 (Tex. Civ. App. 1948); State ex rel. Helsel v. Board of Cnty. Commârs of Cuyahoga Cnty., 37 Ohio Op. 58, 79 N.E.2d 698 (1947). 2260 215 S.W.2d 407 (Tex. Civ. App. 1948). See Michael B. Kent, Jr., âPublic Utilities, Eminent Domain, and Local Land Use Regulations: Has Texas Found the Proper Balance?,â 16 Tex. Wesleyan L. Rev. 29, 31 (2009) (summarizing the Ammons decision), hereinafter referred to as âKent.â 2261 Ammons, 215 S.W.2d at 408-409. See Porter v. Sw. Pub. Serv. Co., 489 S.W.2d 361, 364 (Tex. Civ. App. 1972) (distinguishing the Ammons case because in Ammons the railroad company owned the land for a long time on which it wished to extend a spur line before zoning regulations were promulgated). 2262 Ammons, 215 S.W.2d at 409.
447 police powers.2263 The court observed that although owners receive compensation for land taken by eminent domain, they are not compensated for the effects of changes in zoning or in the zoning laws.2264 Therefore, the court stated that â[t]he absence of compensation makes the police power much harsher in operation than the power of eminent domain and, hence, subject to stricter limitations.â 2265 However, even if FWDC did not have to comply with the zoning regulations, the court held that the railroad would have to obtain a construction permit from the city.2266 Article 2. Interaction of Local Land Use Regulations and Eminent Domain A law review article argues that in cases involving railroads and local land use regulation and eminent domain the use of eminent domain is most consistent with promoting the general welfare.2267 The article contends that utility companies and railroads have obligations that encompass a larger geographic area than local governments that serve the needs of their communities. Thus, the article argues that it is logical that railroads should have more discretion than local governments.2268 The author summarizes the opinion in Ammons,2269 supra, part XVIII.E.1, whose logic is prevalent in many Texas cases, and explains: 2263 Id. at 409-410. 2264 Id. at 410. 2265 Id. 2266 Id. at 411. 2267 See Kent, supra note 2260. 2268 Id. at 45.
448 The logic of that opinion can be traced as follows: (1) the state has a sovereign interest in railroads; (2) to promote this interest, the state delegated its power of eminent domain to the railroad company; and (3) absent an abuse of that delegated authority, the railroadâs decision to promote the statewide interest necessarily takes precedence over the municipalityâs parochial concerns with regard to placement of the facilities.2270 However, greater discretion does not mean that utility companies have absolute discretion.2271 Moreover, although courts may excuse utility companies from âsitingâ regulations (i.e., related to the specific locations of projects) they are still subject to ânon-sitingâ regulations that retain the âcharacterâ (i.e., subjective qualities that are hard to measure objectively) of certain locations.2272 Cases F. Valuation of Property and Just Compensation for Takings 1. Market Value In First English Evangelical Lutheran Church v. Los Angeles County2273 the Supreme Court held that when a condemnor takes property by eminent domain just compensation equals the market value of the property determined as of date of the taking. 2. Special Value not Compensable In Palazzolo v. Rhode Island2274 the Supreme Court held that any special value that a property has to the condemnor is not to be considered when determining market value. 2269 Fort Worth & D. C. Ry. Co. v. Ammons, 215 S.W.2d 407 (Tex. Civ. App. 1948), writ refâd n.r.e. 2270 Kent, supra note 2260, at 45. 2271 Id. 2272 Id. at 48 (citing Bradley C. Karkkainen, âZoning: A Reply to the Critics,â 10 J. Land Use & Envtl. L. 45, 65 (1994)). 2273 482 U.S. 304, 107 S. Ct. 2378, 96 L. Ed.2d 250 (1987). 2274 533 U.S. 606, 121 S. Ct. 2448, 150 L. Ed.2d 592 (2001).
449 3. Severance Damages In State by State Highway Commissioner v. Williams2275 a New Jersey appellate court held that when the government takes only part of a personâs property âthe measure of damages is the difference in the value of the tract before and after the taking, or the value of the land that is taken and compensation for the diminution in value [of the remainder] that will result from the taking.â2276 4. Comparable Sales or Other Evidence In United States v. 329.73 Acres of Land,2277 although the Fifth Circuit observed that âcomparable sales are often the most reliable form of evidence in determining market value,â the court held that evidence other than comparable sales may be admissible in determining the value of property taken by condemnation.2278 5. Whether Injunctive Relief is Available In Osborne & Co. v. Missouri Pacific Railway Co.2279 Osborne & Co. (Osborne) owned property adjoining a public street where the Missouri Pacific Railway Company (Missouri Pacific) planned to lay track. Osborne sought an unconditional injunction against Missouri Pacific to prevent the company from laying tracks on the street.2280 The Supreme Court held that the courts may deny an injunction when a property ownerâs injury (i.e., the decrease in market 2275 65 N.J. Super. 518, 168 A.2d 233 (N.J. App. Div. 1961). 2276 Id., 65 N.J. Super. at 524, 168 A.2d at 236. 2277 666 F.2d 281 (5th Cir. 1982). 2278 Id. at 283. 2279 47 U.S. 248, 13 S. Ct. 299, 37 L. Ed. 155 (1893). 2280 Id., 147 U.S. at 260, 13 S. Ct. at 303, 37 L. Ed. at 161.
450 value of the adjoining property) may be compensated fairly in damages.2281 Article 6. Whether Just Compensation should include Nonmarketable Elements Some commentators argue that compensation based solely on market value is inadequate. Professor John Fee argues that the compensation model for eminent domain should be adjusted to include ânonmarketable elements of home ownership.â2282 Professor Fee draws an analogy between compensation for takings and compensation for wrongful death, noting that relatives of the deceased do not simply receive expected future earnings of the deceased.2283 Therefore, the professor argues that just compensation should include damages in an amount that would make the homeowner âindifferent to the land acquisition at issue:â [T]he ideal award should make the owner indifferent to losing her land, it does not necessarily make her indifferent to the governmentâs power of eminent domain. ... The goal of just compensation should not be to replicate as closely as possible the distribution of entitlements (including windfalls) that would exist in a world without eminent domain; rather, it should be to facilitate public projects that improve the social welfare while leaving condemnees as well off as if the government had left them alone.2284 2281 Id. 2282 John Fee, âEminent Domain and the Sanctity of the Home,â 81 Notre Dame L. Rev. 783 (2006). 2283 Id. at 805. 2284 Id. at 809.
451 Railroad Legal Issues and Resources PART II
452 XIX. EMPLOYEES AND DRUG AND ALCOHOL TESTING A. Introduction Because of safety and security concerns the federal government has regulated the railroad industryâs employment practices.2285 Pursuant to congressional authorization, the Secretary of Transportation issued detailed regulations implementing policies and procedures for testing railroad employees for the use of drugs and alcohol. The United States Supreme Court has held that the Fourth Amendment covers drug and alcohol testing of railroad employees; thus, such testing must be sufficiently reasonable to pass judicial muster.2286 Sections B through F discuss statutes, regulations, and cases on drug and alcohol testing, including the Secretary of Transportationâs authority to promulgate regulations on drug and alcohol testing; regulations on the control of drugs and alcohol use in railroad operations; applicability of the Fourth Amendment to drug and alcohol testing of railroad employees; regulations as amended in 2008 that established more stringent requirements for returning employees; the 2014 proposed regulations to expand alcohol and drug testing to employees performing maintenance-of-way activities; and civil rights claims under § 1983, as well as other issues. Section G discusses an article on the expansion of searches without prior suspicion. Section H discusses the use of drug and alcohol testing for other purposes such as unauthorized genetic testing. 2285 See Skinner v. Ry. Labor Exec. Assân, 489 U.S. 602, 621, 109 S. Ct. 1402, 1415, 103 L. Ed.2d 639, 662 (1989). The FRAâs interest in drug and alcohol testing was very much influenced by the January 1987 accident in Chase, Maryland where an Amtrak train collided with a set of Conrail locomotives. As one report notes, âin 1991, Congress passed the Omnibus Transportation Employee Testing Act, in part due to the Chase crash.â Essex-Middle River Patch, âChase Amtrak Crash: 25 Years Laterâ (Jan. 4, 2012), available at: http://patch.com/maryland/essex/chase-amtrak-crash-25-years-later (last accessed March 31, 2015). 2286 Id., 489 U.S. at 633-634, 109 S. Ct. at 1422, 103 L. Ed.2d at 670.
453 B. Policies and Procedures Applicable to Drug and Alcohol Testing Statutes and Regulations 1. Secretary of Transportationâs Authority to Promulgate Regulations on Drug and Alcohol Testing As provided by federal law, the Secretary of the Department of Transportation (DOT) is empowered to issue regulations on the use of controlled substances and alcohol through programs that require âpreemployment, reasonable suspicion, random, and post-accident testing of all railroad employees responsible for safety-sensitive functionsâ¦.â2287 The law allows the Secretary temporarily to disqualify or dismiss employees who have been discovered to be using or who have been impaired by alcohol while working or while using a controlled substance at any time unless authorized for medical reasons.2288 The Secretary has discretion to âprescribe regulations and issue orders requiring railroad carriers to conduct periodic recurring testing of railroad employees responsible for safety- sensitive functions (as decided by the Secretary) for the use of alcohol or a controlled substance in violation of law or a Government regulation.â2289 In carrying out drug and alcohol testing, the Secretary is to promote the most privacy possible and implement the Department of Health and Human Services guidelines for laboratory testing.2290 Furthermore, testing may not be conducted in a discriminatory manner, and test results must remain confidential.2291 2287 49 U.S.C. § 20140(b)(1)(A) (2014). 2288 49 U.S.C. § 20140(b)(1)(B) (2014). 2289 49 U.S.C. § 20140(b)(2) (2014). 2290 49 U.S.C. §§ 20140(c)(2)-(6) (2014). 2291 49 U.S.C. §§ 20140(c)(7)-(8) (2014).
454 The statute authorizes the Secretary to issue regulations regarding rehabilitation programs for drug and alcohol use or abuse.2292 The regulations must comply with the United Statesâ international obligations,2293 which are important with respect to the drug and alcohol testing of employees of foreign railroads who enter the United States to work.2294 After consultations with the governments of Canada and Mexico, the Federal Railroad Administration (FRA) issued a final rule in 2004 that applies to the testing of such foreign railroad employees. The rule only applies to foreign employees who travel over ten miles each way within the United States (i.e., over twenty miles roundtrip) before returning to their country.2295 2. Regulations for the Control of Alcohol and Drug Use in Railroad Operations Transportation employers are subject to detailed requirements for drug and alcohol testing in the workplace for safety-sensitive employees.2296 The regulations cover such matters as consent forms,2297 laboratory requirements,2298 the return to work of rehabilitated employees,2299 and confidentiality.2300 Part 219 of the Code of Federal Regulations (C.F.R.) 2292 49 U.S.C. § 20140(d) (2014). 2293 49 U.S.C. § 20140(e) (2014). 2294 Control of Alcohol and Drug Use: Coverage of Maintenance of Way Employees, Retrospective Regulatory Review-Based Amendments (RRR), 79 Fed. Reg. 43830 (proposed July 28, 2014) (to be codified at 49 C.F.R. pt. 219), hereinafter referred to as âControl of Alcohol and Drug Use: Coverage of Maintenance of Way Employees.â 2295 49 C.F.R. § 219.3(c) (2014). 2296 49 C.F.R. § 40.1(b) (2014); see generally 49 C.F.R. part 40 (2014). 2297 49 C.F.R. § 40.27 (2014). 2298 49 C.F.R. §§ 40.81-40.113 (2014); Appendix B § 219 (2014). 2299 49 C.F.R. §§ 40.281-40.313 (2014). 2300 49 C.F.R. §§ 40.321-40.333 (2014).
455 describes in detail prohibitions that apply to railroad employees,2301 as well as post-accident toxicological testing,2302 testing for cause,2303 identification of troubled employees,2304 pre- employment tests,2305 random alcohol and drug testing programs,2306 and testing procedures.2307 Case C. The Fourth Amendment Applies to Drug and Alcohol Testing of Railroad Employees Skinner v. Railway Labor Executivesâ Association,2308 decided by the United States Supreme Court, appears to be the seminal case on drug and alcohol testing of railroad employees. Although the Court analyzed a repealed version of the statute on testing for alcohol and controlled substances, the Courtâs analysis applies to the current version of the statute. In Skinner, the Railway Labor Executivesâ Association (RLEA), a railroad labor organization, sought to enjoin the FRAâs regulations on drug and alcohol testing of railroad employees who in particular are involved in train accidents and who disobey specific safety rules.2309 After the FRA issued a final rule in 1985, the RLEA brought an action in a federal 2301 49 C.F.R. §§ 219.101-219.107 (2014). 2302 49 C.F.R. §§ 219.201-219.213 (2014). 2303 49 C.F.R. §§ 219.300-219.302 (2014). 2304 49 C.F.R. §§ 219.401-219.407 (2014). 2305 49 C.F.R. §§ 219.501-219.505 (2014). 2306 49 C.F.R. §§ 219.601-219.611 (2014). 2307 49 C.F.R. § 219.701 (2014). 2308 489 U.S. 602, 109 S. Ct. 1402, 103 L. Ed.2d 639 (1989). 2309 Id., 489 U.S. at 612, 109 S. Ct. at 1411, 103 L. Ed.2d at 657.
456 district court seeking an injunction to prevent the implementation of the regulations.2310 The Supreme Court held that railroad companies act as agents of the federal government in carrying out drug and alcohol tests as required by the regulations; therefore, the FRAâs rule on the railroadsâ testing of employees for the use of drugs and alcohol implicated the Fourth Amendmentâs protection from unreasonable searches and seizures.2311 The Court stated: We are unwilling to conclude, in the context of this facial challenge, that breath and urine tests required by private railroads in reliance on Subpart D will not implicate the Fourth Amendment. Whether a private party should be deemed an agent or instrument of the Government for Fourth Amendment purposes necessarily turns on the degree of the Governmentâs participation in the private partyâs activities, ⦠a question that can only be resolved âin light of all the circumstancesâ¦..â The fact that the Government has not compelled a private party to perform a search does not, by itself, establish that the search is a private one. Here, specific features of the regulations combine to convince us that the Government did more than adopt a passive position toward the underlying private conduct.2312 Based on a Fourth Amendment analysis, the Court balanced the safety needs of a railroad with the diminished privacy expectations of its employees.2313 The Court ruled that urine and breath testing was an obvious violation of an expectation of privacy but one that society deems to be reasonable.2314 In light of the limited discretion exercised by the railroad employers under the regulations, the surpassing safety interests served by toxicological tests in this context, and the diminished expectation of privacy that attaches to information 2310 Id. 2311 Id., 489 U.S. at 614, 109 S. Ct. at 1411, 103 L. Ed.2d at 658. 2312 Id., 489 U.S. at 614-615, 109 S. Ct. at 1411-1412, 103 L. Ed.2d at 658 (citations omitted). 2313 Id., 489 U.S. at 621, 109 S. Ct. at 1415, 103 L. Ed.2d at 662. 2314 Id., 489 U.S. at 616, 109 S. Ct. at 1413, 103 L. Ed.2d at 659.
457 pertaining to the fitness of covered employees, we believe that it is reasonable to conduct such tests in the absence of a warrant or reasonable suspicion that any particular employee may be impaired.2315 The Court held that drug and alcohol testing of employees as required by the FRAâs regulations was reasonable under the Fourth Amendment.2316 Statutes and Regulations D. 2008 Modifications and More Stringent Requirements for Returning Employees In 2008, the DOT modified its drug and alcohol testing requirements by making them more stringent for employees who return to work after failing a drug test and completing a drug treatment program.2317 In particular, the DOT required that tests for such employees must be conducted under direct supervision to prevent cheating.2318 In BNSF Railway Co. v. United States Department of Transportation2319 BNSF and multiple transportation unions argued that the revised regulations2320 violated the Fourth Amendment to the United States Constitution; however, the District of Columbia Circuit held that the modifications were neither âarbitraryâ nor âcapriciousâ under the Administrative Procedure Act. The court explained: [T]he Department acted neither arbitrarily nor capriciously in concluding that the growth of an industry devoted to circumventing drug tests, coupled with returning employeesâ higher rate of drug use and heightened motivation to cheat, presented an elevated risk of cheating on return-to-duty and follow-up tests that justified the 2315 Id., 489 U.S. at 634, 109 S. Ct. at 1422, 103 L. Ed.2d at 671. 2316 Id. 2317 BNSF Ry. Co. v. United States Depât of Transp., 566 F.3d 200 (D.C. Cir. 2009). 2318 Id. at 202. 2319 Id. at 203. 2320 Id. at 202 (citing 49 C.F.R. §§ 40.285, 40.305, 40.307(d), and 40.309 (2008)).
458 mandatory use of direct observation.2321 In addition, the court balanced the need for transportation safety with employeesâ right to privacy and concluded that the modified regulations did not violate the Fourth Amendmentâs prohibition on unreasonable searches and seizures.2322 E. 2014 Proposed Regulations to Expand Alcohol and Drug Testing to Employees Performing Maintenance-of-Way Activities Pursuant to the congressional mandate in the Rail Safety Improvement Act of 2008, FRA âis proposing to expand the scope of its alcohol and drug regulations to cover employees who perform maintenance-of-way (MOW) activitiesâ and to amend and clarify current alcohol and drug regulations.2323 As used in the notice of proposed rulemaking, the term ââemployeeâ includes employees, volunteers, and probationary employees of railroads and contractors (defined to include subcontractors) to railroads.â2324 The FRA is proposing a new term-of-art -- âregulated serviceâ-- that would encompass both covered service and MOW activities. Performance of regulated service would make an individual a âregulated employeeâ subject to part 219, regardless of whether the individual is employed by a railroad or a contractor to a railroad.2325 The FRA also proposed amendments to part 219 to permit post-accident toxicological (PAT) âtesting when an accident was likely due to human factors or involved a regulated employee fatality.â2326 2321 Id. at 206. 2322 Id. at 209. 2323 Control of Alcohol and Drug Use: Coverage of Maintenance of Way Employees, supra, footnote 2281. 2324 Id. at 43831. 2325 Id.
459 The FRA intends to include MOW employees among those who may be tested for alcohol or drugs. The reason is that âMOW employees are at a high safety risk because they work along railroad track and roadbed and may suffer injury or death as a result of being struck by trains or other on-track or fouling equipment.â2327 The notice of proposed rulemaking cites recent railroad accidents as support for the need to test MOW employees. For example, in 2007 a Massachusetts Bay Transit Administration (MBTA) train operated by the Massachusetts Bay Commuter Railroad (MBCR) collided with a maintenance vehicle, killing two MBTA employees, the MOW foreman, and a track worker, and injuring two others.2328 The foreman in charge of the MOW crew failed to comply with a MBCR rule that would have provided signal protection for the segment of track on which the MOW crew was working. 2329 Although the MOW employees were not covered employees, the remains of the deceased MOW could still be tested because § 219.203(e)(4)(ii) ârequire[s] PAT testing on the remains of any railroad employees fatally injured in a train accident or incident.â2330 The tests showed that the MOW foreman had used marijuana within three hours of the collision.2331 2326 Id. 2327 Id. at 43832. 2328 Id. 2329 Id. 2330 Id. (citing 49 C.F.R. § 219.203(a)(4)(ii)). 2331 Id.
460 The National Transportation Safety Board (NTSB) conducted a ten-year review of railroad accidents involving MOW employee deaths and found a positive rate of 19.23% compared to a 6.56% for covered employees in PAT testing.2332 The proposed regulations define MOW activities to include: (1) The inspection, repair, or maintenance of track, roadbed, or electric traction systems; (2) the operation of on-track or fouling equipment utilized for the inspection, repair, or maintenance of track, roadbed, or electric traction systems; (3) the performance of flagman or watchman/lookout duties; (4) the obtaining of on-track authority and/or permission for the performance described by the proposed definition; or (5) the granting of on-track authority and/or permission for operation over a segment of track while workers are performing activities described by the proposed definition.2333 The FRA is requesting comment on whether MOW activities should include: (1) Boring a pipe under a track; (2) paving a highway-rail grade crossing; (3) placing detour or other signs in conjunction with grade crossing work; (4) operating cranes for the loading and unloading of MOW equipment, regardless of whether or not that equipment is being loaded onto or within the foul of a track; (5) clearing and repairing a railroad track following an accident or incident; and (6) operating a bridge if the employee is not covered under the [Hours of Service] laws.2334 The FRA also is proposing two new definitions for § 215.5.2335 The first new term, âregulated employee,â is defined as âany employee who is subject to part 219 (whether a covered or MOW employee)â¦.â2336 The second new term, âregulated service,â is defined as âall 2332 Id. at 43833. 2333 Id. 2334 Id. at 43834. 2335 Id. at 43835. 2336 Id.
461 activities subject to part 219 (again, both covered service and MOW activities).â2337 The purpose of the new terms is to encompass all activities and individuals subject to part 219 and to eliminate more awkward terms such as maintenance-of-way employee.2338 The proposed regulations would grandfather all current MOW employees from pre- employment testing; thus, only MOW employees hired after the effective date would be subject to pre-employment testing.2339 Case F. Civil Rights Claims under Section 1983 In Griffin v. Long Island Railroad,2340 after the Long Island Railroad (LIRR) terminated Griffin for failing to pass a random drug test, the employee brought an action in a federal court in New York against LIRR under 42 U.S.C. § 1983. Because LIRR failed to inform Griffin of his right to ask for independent testing as required by the regulations Griffin argued that he was entitled to damages and back-pay.2341 The court noted that the courts disagree on whether plaintiffs may bring § 1983 claims for violations of regulations;2342 however, the court held that Griffin could bring an action in this instance because the statute authorizing the FRA to 2337 Id. 2338 Id. 2339 Id. at 43838-43839. 2340 1998 U.S. Dist. LEXIS 19336 *1 (E.D.N.Y. 1998). 2341 Id. at *11. 2342 Id. at *29.
462 promulgate regulations created a right that was intended to benefit the plaintiff.2343 Moreover, the statute did not expressly withdraw his right to relief under § 1983.2344 Nevertheless, the court did not grant either partyâs motion for a summary judgment because the issue of whether the plaintiff knew of his right to request independent testing after learning of his positive drug test was a question of material fact.2345 Articles G. Expansion of Suspicionless Searches A law review article entitled âSpecial Needs and Special Deference: Suspicionless Civil Searches in the Modern Regulatory Stateâ examines the Supreme Courtâs expansion of the special needs exception, as seen in Skinner, supra, to the individualized suspicion and warrant requirements of the Fourth Amendment.2346 The article argues that the Supreme Court is âapplying varying levels of deference in its special needs jurisprudence, depending on the degree of correlation between the governmentâs asserted special need and the predefined regulatory objective at issue.â2347 The article urges that although the Supreme Courtâs approach may increase coherence and predictability in special needs cases the approach should be limited in scope and should not outweigh other factors.2348 2343 Id. at *36, *38. 2344 Id. at *54. 2345 Id. at *60. 2346 Fabio Arcila, Jr., âSpecial Needs and Special Deference: Suspicionless Civil Searches in the Modern Regulatory State,â 56 Admin. L. Rev. 1223, 1224 (2004). 2347 Id. at 1226. 2348 Id.
463 H. Genetic Testing As the Supreme Court stated in Skinner, â[i]t is not disputed ⦠that chemical analysis of urine, like that of blood, can reveal a host of private medical facts about an employee, including whether he or she is epileptic, pregnant, or diabetic.â2349 An article entitled âWorkplace Privacy and Discrimination Issues Related to Genetic Data: A Comparative Law Study of the European Union and the United Statesâ explains how employers may use samples of bodily fluids to obtain medical information on employees without their knowledge.2350 The article examines a case in which BNSF was alleged to have secretly ordered genetic tests during examinations of employees who had filed a work-related disability claim for carpal tunnel syndrome.2351 BNSF allegedly did not inform the employees of the test because the company wanted to determine whether employees had a genetic predisposition to carpal tunnel syndrome.2352 The Equal Employment Opportunity Commission filed an action in which it alleged that BNSF violated the Americans with Disabilities Act and sought to enjoin BNSFâs conduct.2353 However, the case settled when BNSF agreed to discontinue any genetic testing.2354 2349 Skinner, 489 U.S. at 617, 109 S. Ct. at 1413, 103 L. Ed.2d at 659. 2350 Nancy J. King, Sukanya Pillay, and Gail A. Lasprogata, âWorkplace Privacy and Discrimination Issues Related to Genetic Data: A Comparative Law Study of the European Union and the United States,â 43 Am. Bus. L.J. 79 (2006), hereinafter referred to as âKing, Pillay, and Lasprogata.â 2351 Id. See also, Patricia A. Roche, âThe Genetic Revolution at Work: Legislative Efforts to Protect Employees,â 28 Am. J.L. & Med. 271, 272 (2002), hereinafter referred to as âRoche.â 2352 King, Pillay, and Lasprogata, supra note 2350, at 79. 2353 Id. 2354 Roche, supra note 2351, at 272.
464 XX. ENVIRONMENTAL LAW AND RAILROADS A. Introduction This part of the Report discusses environmental law and railroads beginning with section B on the liability of railroad companies under the Comprehensive Environmental Response Compensation and Liability Act (CERCLA) applicable to railroadsâ release of hazardous substances, the enforcement efforts undertaken by the Environmental Protection Agency (EPA), state statutes that incorporate CERCLA, and cases arising under the state statutes. Section C discusses the Clean Railroads Act and environmental requirements for permits for new facilities. Section D addresses issues in connection with the Hazardous Materials Transportation Act (HMTA) that authorizes the Secretary of Transportation to issue regulations on the safe transportation, including security, of hazardous material in intrastate, interstate, and foreign commerce. Section E discusses the requirements of the National Environmental Policy Act (NEPA), as well as regulations of the Federal Railroad Administration (FRA) and the Surface Transportation Board (STB). Section F summarizes an article on federal preemption of local air quality laws and regulations. B. The Comprehensive Environmental Response Compensation and Liability Act Statutes and Regulations 1. Liability under CERCLA Under CERCLA a railroad company may be covered by CERCLA and held liable, inter alia, as the âowner and operator of a vessel or a facility;â as one âwho at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed of;â as one âwho by contract, agreement, or otherwise arranged for disposal or
465 treatment, or arranged with a transporter for transport for disposal or treatment, of hazardous substances owned or possessed by such personâ¦.;â and as one âwho accepts or accepted any hazardous substances for transport to disposal or treatment facilities ⦠from which there is a release, or a threatened release which causes the incurrence of response costs, of a hazardous substanceâ¦.â2355 There is no liability when a person subject to CERCLA is able to âestablish by a preponderance of the evidenceâ that any release or threatened release was caused solely by an act of God, act of war, or âan act or omission of a third party other than an employee or agent of the defendantâ or under other circumstances as are further described in the statute that will absolve one of liability.2356 Under CERCLA no person is liable for damages or costs âas a result of actions taken or omitted in the course of rendering care, assistance, or advice in accordance with the National Contingency Plan or at the direction of an [on-scene] coordinatorâ¦.â2357 State and local governments are protected from liability as long as the costs or damages were not âa result of gross negligence or intentional misconduct by the State or local government.â2358 2. EPA Enforcement and Civil Proceedings under CERCLA Liability and fines apportioned by the EPA to an entity that has violated CERCLA may be challenged in a federal district court.2359 Section 9613 of CERCLA grants exclusive 2355 See 42 U.S.C. §§ 9607(a)(1)-(4) (2014). 2356 See 42 U.S.C. §§ 9607(b)(1)-(3) (2014). 2357 42 U.S.C. § 9607(d)(1) (2014). 2358 42 U.S.C. § 9607(d)(2) (2014). 2359 42 U.S.C. §§ 9609(a)(4) and 9613 (2014).
466 jurisdiction to federal district courts over all controversies that arise under CERCLA,2360 including actions for damages to natural resources, recovery of costs, contribution, subrogation, and recovery of indemnification payments.2361 Section 9613 provides that the courts will use the administrative record in reviewing âthe adequacy of any response action taken or ordered by the Presidentâ¦.â2362 The statute also provides time limitations of between three to six years for filing an action for the recovery of costs for violations of § 9607.2363 Congress has authorized the President to enforce the provisions of CERCLA.2364 However, by Executive Order the EPA and other federal agencies have been delegated the authority that is granted to the President under CERCLA.2365 The enforcement process begins with the EPA identifying the potentially responsible parties (PRPs) that contributed to contamination.2366 After the PRPs are identified, the EPA may conduct a cleanup of a site using Superfund money and seek to recover the cost of the cleanup from the PRPs.2367 Alternatively, the EPA may issue a unilateral administrative order (UAO) or request a court to order the PRPs 2360 42 U.S.C. § 9613 (2014). 2361 42 U.S.C. § 9613(g) (2014). 2362 42 U.S.C. § 9613(j)(1) (2014). 2363 Id. 2364 United States Environmental Protection Agency, Office of Enforcement and Compliance Assurance Office of Site Remediation Enforcement, EPA PRP Search Manual: Overview of CERCLA and PRP Searches, at 2, available at: http://www2.epa.gov/sites/production/files/documents/prp-man-chap1-09.pdf (last accessed March 31, 2015), herein referred to as âPRP Search Manual.â 2365 Id. 2366 Id. at 33. 2367 42 U.S.C. §§ 9604 and 9607 (2014).
467 to clean up the site.2368 The âEPA has adopted an âenforcement firstâ policy for removal and remedial actions at CERCLA sitesâ and âwill first pursue the PRPs to conduct the site response rather than conduct the cleanup with Superfund money.â2369 In addition, âEPA may seek to obtain PRP participation through settlements, unilateral orders, or litigation.â2370 The EPAâs âlegal documents ⦠describe the requirements of the response action.â2371 The EPA may require the PRPs to enter into an administrative order on consent (AOC) or a consent decree (CD).2372 An AOC is a legally binding administrative order signed by the EPA and the PRPs, whereas the CD occurs as a result of a judicial action and is subject to the approval of a federal court and the Department of Justice (DOJ).2373 CERCLA § 122(g)2374 empowers the EPA to negotiate âde minimis settlements with parties whose contribution is minimal in amount and toxicity if the settlement involves only a minor portion of the response costs.â2375 2368 42 U.S.C. § 9606 (2014). 2369 PRP Search Manual, supra note 2364, at 4. 2370 Id. at 5. 2371 Id. at 37. 2372 Id.; see 42 U.S.C. § 9622(d) (2014). 2373 PRP Search Manual, supra note 2364, at 37. 2374 42 U.S.C. § 9622(g) (2014). 2375 PRP Search Manual, supra note 2364, at 6.
468 Cases 3. Unilateral Administrative Orders Issued by the EPA do not Violate the Fifth Amendment In General Electric v. Jackson2376 the District of Columbia Circuit held that the EPAâs issuance of a CERCLA-UAO does not violate the Due Process Clause of the Fifth Amendment of the United States Constitution.2377 CERCLA was enacted to address risks posed by industrial pollution and â[a]lthough CERCLA speaks in terms of the President, the President has delegated his UAO authority to the EPAâ by an executive order.2378 If the EPA determines that an environmental site warrants clean up, one of the agencyâs four options is to issue a UAO ordering the PRP(s) to clean up the site.2379 The EPA has issued several UAOs under CERCLA to General Electric (GE) and has reserved the right to issue more at other sites where it believes GE contributed to contamination.2380 GE has argued that CERCLAâs UAO regime violates the Due Process Clause because âUAO recipient[sâ] only real option is to comply ... before having any opportunity to be heard on the legality and rationality of the underlying order.â2381 GE argued that a UAO deprives PRPs of the money that they must spend to comply with a UAO or fines that they must 2376 610 F.3d 110 (D.C. Cir. 2010), rehearing denied by, rehearing, en banc, denied , 2010 U.S. App. LEXIS 27485 (D.C. Cir., Sept. 30, 2010), cert. denied, 131 S. Ct. 2959, 180 L. Ed.2d 245, 2011 U.S. LEXIS 4334 (U.S., 2011). 2377 Id. at 113. 2378 Id. at 114 (citing Exec. Order No. 12,580, 52 Fed. Reg. 2923 (Jan. 23, 1987)). 2379 Id. 2380 Id. at 115. 2381 Id. at 116 (internal citations omitted).
469 pay if they refuse to comply and that the âPRPsâ stock price, brand value, and costs of financing ... are adversely affected by the issuance of a UAO.â2382 The court held that the PRPs do not face a Hobsonâs choice by paying to comply or by paying fines because the PRPs are only fined when a federal court finds that a PRP willfully failed to comply without sufficient cause with a proper UAO and further finds in the courtâs discretion that the fines and treble damages are appropriate.2383 The District of Columbia Circuit held that GEâs consequential damages did not constitute a deprivation of rights because although GE may have suffered reputational harm GE must prove that the EPA deprived the company of a benefit to which it had a legal right2384 or imposed a âstigma so severe that it âbroadly precludesâ [GE] from pursuing âa chosen trade or business.ââ2385 GE could prove neither.2386 The court held that because recipients of UAOs may be complying in the belief that the orders are accurate and would pass judicial scrutiny, rather than because they believe that they are being coerced into complying, the UAO provisions were not being applied in a manner that violates the Fifth Amendment.2387 The court affirmed the district courtâs decision.2388 2382 Id. at 117. 2383 Id. at 118-119. 2384 Id. at 121. 2385 Id. (quoting Trifax Corp. v. District of Columbia, 314 F.3d 614 (D.C. Cir. 2003)). 2386 Id. 2387 Id. at 128-129. 2388 Id. at 129.
470 4. Apportionment under CERCLA of Costs among Responsible Parties Burlington Northern and Santa Fe Railroad Co. v. United States2389 is the leading case interpreting what CERCLA means when the law imposes liability on those who âarrange forâ the disposal of a hazardous substance.2390 In Burlington Northern the Supreme Court considered who the responsible parties were and how the costs should be apportioned for a chemical leak on a property that was partially owned by a railroad, the owner of the facility, and a chemical manufacturer. In brief, in 1960, Brown & Bryant, Inc. (B&B), an agricultural chemical distributor, began operating on a parcel of land located in Arvin, California. B&B later expanded onto an adjacent parcel owned by BNSF and Union Pacific. B&B purchased and stored various hazardous chemicals that it purchased from Shell Oil Company (Shell) that contaminated the property because of spills and equipment failures. Although CERCLA did not state what it meant to arrange for the disposal of a hazardous substance, the Court chose to use the plain meaning of the term. The Court held that âan entity may qualify as an arranger under § 9607(a)(3) when it takes intentional steps to dispose of a hazardous substance.â2391 As for each partyâs respective share of liability, based on the Restatement (Second) of Torts, the Court held that liability may be apportioned when there is a basis for âdetermining the contribution of each cause to a single harm.â2392 The Court held that âthe Court of Appeals erred by holding Shell liable as an arranger under CERCLA for the costs of remediating environmental contamination at the Arvin, 2389 556 U.S. 599, 129 S. Ct. 1870, 173 L. Ed.2d 812 (2009). 2390 Id., 556 U.S. at 607, 129 S. Ct. at 1877, 173 L. Ed.2d at 821. 2391 Id., 556 U.S. at 611, 129 S. Ct. at 1879, 173 L. Ed.2d at 823. 2392 Id., 556 U.S. at 614, 129 S. Ct. at 1881, 173 L. Ed.2d at 825.
471 California facilityâ but that âthe District Court reasonably apportioned the Railroadsâ share of the site remediation costs at 9%.â Because the owner-operator of the Arvin facility Brown & Bryant was insolvent, no liability for the cost of the cleanup was apportioned to it; therefore, the nine percent allocated to the railroads was the only cost not covered by the state.2393 Statute 5. Liability under State Law that Incorporates CERCLA Under the Polanco Act in California âa local redevelopment agency can recover the costs it incurs for contamination remediation within a redevelopment project area from any âresponsible party.ââ 2394 As for the connection between CERCLA and the Polanco Act, [t]he Polanco Act defines a âresponsible partyâ as any person described in either: (1) California Health and Safety Code section 25323.5 (which, in turn, refers to persons described in the federal Comprehensive Environmental Response, Compensation, and Liability Act (CERCLA) at 42 U.S.C. § 9607(a)); or (2) California Water Code section 13304(a).2395 Case 6. Railroads not Liable because they were not Owners or Operators nor did they Create or Assist in Creating a Nuisance In Redevelopment Agency v. BNSF Railway Company2396 BNSF and Union Pacific (the Railroads) at one time maintained railroad tracks on a parcel of land in Stockton, California that was later discovered to have been contaminated by a petroleum spill from a nearby facility. In 2393 Id., 556 U.S. at 605, 129 S. Ct. at 1876, 173 L. Ed.2d at 820. 2394 Redevelopment Agency of City of Stockton v. BNSF Railroad Co., 643 F.3d 668, 676 (9th Cir. 2011). 2395 Id. at 677 (citing Cal. Health & Safety Code § 33459(h)). 2396 643 F.3d 668 (9th Cir. 2011).
472 1968, because of highway construction the state of California entered into an agreement with the Railroadsâ predecessors-in-interest to relocate railroad tracks from the proposed site of an interchange to a nearby state-owned parcel.2397 When BNSF and Union Pacific acquired an interest of some nature is not clear, but the state did not transfer the land by deed to the Railroads until 1983.2398 Between 1968 and 1983 the Railroads installed a french drain beneath the roadbed to facilitate drainage.2399 The french drain acted as a conduit or pathway for petroleum contaminants likely caused by a spill in 1974 from a nearby petroleum facility.2400 After the Railroads sold their interest to the Redevelopment Agency of the City of Stockton (Redevelopment Agency), and after the Agency sold a portion to a commercial developer, site excavation in âArea 3â of the property revealed contamination.2401 The Redevelopment Agency sought to recover from the Railroads the cost of the remediation of the property. On cross-motions for summary judgment, a California district court held that the Railroads were liable. The Ninth Circuit affirmed in part, reversed in part, and remanded. First, the Railroads were not liable under California nuisance law, even though the Railroads installed the french drain. The district court had held that the Railroads were liable because absent the french drain (âbut forâ the french drain) there would have been no contamination. However, the Ninth Circuit held: 2397 Id. at 671. 2398 Id. 2399 Id. 2400 Id. at 672. 2401 Id. at 671-672.
473 Because the Railroadsâ conduct with regard to the specific nuisance condition--the contamination--was not active, affirmative, or knowing, the Railroads simply did not âcreate or assist in the creationâ of the nuisance on the Property. ⦠While the Railroads may have acted affirmatively with regard to the installation of the french drain, that conduct was wholly unrelated to the contamination.2402 Second, the Railroads were not liable for nuisance as âpossessors of the Property:â No evidence has been adduced that the Railroads had actual knowledge of the contamination while they were in possession of the Property. ⦠This is not a case in which, for example, the nuisance was in any way manifest on the surface of the land. ⦠Indeed, the contamination was not discovered by any subsequent owner or possessor of the land, including the Agency itself, until excavation began at the Property some sixteen years after the Railroads sold it.2403 Third, the Railroads were not liable under Californiaâs Polanco Act:2404 âUnder the Polanco Act, a local redevelopment agency may recover the costs it incurs for the remediation of contamination within an area of a redevelopment project from any âresponsible party.ââ2405 The Railroads were not responsible parties because their involvement was âremote and passive;â2406 the âfrench drain merely acted as a conduit for the waste that had been initially released into the environment at the L&M Site.â2407 Fourth, the Polanco Act imposes liability on persons as described in CERCLA, 42 U.S.C. § 9607(a). CERCLA applies to ââany person who at the time of disposal of any hazardous substance owned or operated any facility at which such hazardous substances were disposed 2402 Id. at 674. 2403 Id. at 675. 2404 See id. at 677 (citing Cal. Health & Safety Code § 33459, et seq.). 2405 Id. (citations omitted). 2406 Id. at 678. 2407 Id. at 677 (citations omitted).
474 of.ââ2408 The Ninth Circuit agreed with the district court that the âRailroads were not liable under the Polanco Actâs CERCLA provision because they were not âownersâ or âoperatorsâ within the meaning of CERCLA.â2409 It is somewhat unclear what the deed in 1983 transferred to the Railroads because one of the Redevelopment Agencyâs arguments was that âthe Railroads were ⦠âownersâ of the Property within the meaning of CERCLA when the petroleum release occurred because ⦠they held an easement or license to operate trains over the Property pursuant to the Agreement.â 2410 In any case, the court held that having an easement did not make the Railroads an owner.2411 The Redevelopment Agencyâs argument that the Railroads had an easement may have been based on the aforesaid Agreement that allowed the Railroads to construct and use track on the property âas licensed by the Agreementâ¦.â2412 Nevertheless, the Ninth Circuit agreed with the district court that the Railroads were not owners under CERCLA.2413 The Ninth Circuit affirmed that part of the opinion of the district court in favor of the Railroads but reversed the district court on other issues on which the district court had ruled in favor of the Redevelopment Agency. 2414 2408 Id. at 678 (quoting 42 U.S.C. § 9607(a)(2)). 2409 Id. 2410 Id. 2411 Id. at 679. 2412 Id. 2413 Id. 2414 Id. at 680.
475 Statutes 7. Kentucky Statute on Contamination Caused by Hazardous Substances Although no cases were located involving railroads and a Kentucky statute on contamination caused by hazardous materials, the statute applies, inter alia, to reportable quantities and to release notification requirements for hazardous substances, pollutants, or contaminants and remedial action to restore the environment, as well as to the liability of a financial institution acquiring property or serving as a fiduciary.2415 8. Liability under an Indiana Statute to the Same Extent as under CERCLA Although no railroad cases were located involving an Indiana statute, the statute provides that except as otherwise provided a person liable under CERCLA is liable to the state of Indiana in the same manner and to the same extent.2416 9. Liability under the Pennsylvania Hazardous Sites Cleanup Act Pennsylvania has its own cleanup statute, the Pennsylvania Hazardous Sites Cleanup Act (HSCA) that provides a remedy for expenses caused by releases of hazardous substances.2417 Cases 10. Railroads May Bring Claim for Contribution under CERCLA and HSCA In Reading Co. v. City of Philadelphia2418 the Reading Company (Reading) sued the city of Philadelphia and other defendants under CERCLA and Pennsylvaniaâs HSCA, supra, for 2415 Ky. Rev. Stat. Ann. § 224.1-400 (2014). 2416 Ind. Code Ann. §§ 13-25-4-8(a) and (a)(3)(C) (2014). 2417 35 Pa. Cons. Stat. Ann. § 6020.102(8) (2014). 2418 823 F. Supp. 1218 (E.D. Pa. 1993).
476 contribution from defendants for their share of the $8.6 million in clean-up costs already incurred by [Reading Co.], as well as any future costs incurred, in removing polychlorinated biphenyls (PCBs) from the viaduct which formerly bore tracks of the Ninth Street branch of the Reading Railroad to the Reading Terminal train shed, the Reading Terminal train shed, the structures associated with that train shed, the structural components of the train shed, and the interstitial materials lying between the floor of the train shed and the ceiling of the Reading Terminal Market.2419 The court denied a motion by several defendants for a summary judgment on all claims and held that Reading could maintain its contribution claim. 11. Liability under Washingtonâs Model Toxics Control Act for Environmental Cleanup The state of Washingtonâs Model Toxics Control Act (MTCA) imposes liability for environmental cleanup.2420 A case decided in 1999 involving the MTCA is Harbor Steps Limited Partnership v. Seattle Technical Finishing, Inc.2421 in which the current property owner sued its predecessor-in-interest Burlington Northern for cleanup expenses for contaminated land. Burlington Northern âsold the property by real estate contract in 1910, shortly before the contamination occurred.â2422 A Washington appellate court affirmed a superior court decision granting Burlington Northernâs motion for summary judgment because âunder the MTCA secured creditor exceptions to liability ⦠[Burlington Northern] held only a security interest in the property during the time that it was contaminated.â2423 Although the court stated that 2419 Id. at 1221-1222. 2420 Wash. Rev. Code Ann. § 70.105D.040 (2014). 2421 93 Wash. App. 792, 970 P.2d 797 (1999). 2422 Id., 93 Wash. App. at 795, 970 P.2d at 798. 2423 Id., 93 Wash. App. at 795, 970 P.2d at 798-799.
477 summary judgment was proper âirrespective of the 1995 amendmentsâ to the MTCA secured creditor exceptions, summary judgment was âeven more justified under the amended statute.â2424 Articles 12. Survey of States with CERCLA-type Laws An article entitled âNatural Resource Damages: Recovery under State Law Compared with Federal Lawsâ observes that âeach state has the right to pass its own laws for recovery of natural resource damages;â that CERCLA âdoes not preempt any state from imposing additional liability or requirements regarding the release of hazardous substances;â and that âCERCLA ⦠does not affect obligations under state law, including common law, with respect to the release of hazardous substances.â2425 The article includes a survey of state âenvironmental statutes for CERCLA-type laws pertaining to the release of a hazardous substance.â2426 13. History of EPAâs Enforcement of CERCLA An article in the Southwestern Law Review summarizes the enforcement of CERCLA by the EPA from its inception through the first three years of President Barack Obamaâs presidency.2427 At the end of the Carter Administration, the EPA created the Hazardous Waste Enforcement Task Force (HWTF) and the DOJ created the Hazardous Waste Section (HWS) to 2424 Id., 93 Wash. App. at 795, 970 P.2d at 798-799. The court held that the 1995 amendments were retroactive anyway. 2425 Lloyd W. Landreth and Kevin M. Ward, âNatural Resource Damages: Recovery Under State Law Compared With Federal Laws,â 20 Envir. L. Rep. 10134, 10137 (1990), available at: http://elr.info/sites/default/files/articles/20.10134.htm (last accessed March 31, 2015). 2426 Id. 2427 Joel A. Mintz, âEPA Enforcement of CERCLA: Historical Overview and Recent Trends,â 41 Sw. L. Rev. 645 (2012).
478 clean up hazardous waste.2428 Within eighteen months, the HWTF and HWS filed fifty-four judicial enforcement actions under the authority of the Resource Construction and Recovery Act (RCRA).2429 In 1980, Congress enacted CERCLA but the EPA adopted a ânon-confrontational approachâ to enforcement because the Reagan Administrationâs position was that the process was too litigious; thus, the PRPs were to be asked to clean up sites voluntarily.2430 After Congress opened investigations in 1982 into EPAâs mismanagement and lack of enforcement, the EPA and DOJ bolstered their enforcement efforts.2431 Because the Superfund program lacked funds during President George W. Bushâs administration the EPA increased its efforts to recover money from PRPs that was spent on cleanups. The EPA also âbegan to put greater stress on requiring adequate financial assurance[] in the form of insurance, performance bonds, and letters of credit[] from responsible parties in CERCLA enforcement orders and Consent Decreesâ and on identifying companies engaged in fraud to avoid their cleanup responsibilities.2432 It is reported that during the Obama Administration the EPA has enunciated clear goals and priorities for enforcement, transparency, and public candor. However, the EPAâs current level of resources and staff hinders its abilities to attain its goals.2433 The authorâs conclusion is 2428 Id. at 646. 2429 Id. 2430 Id. at 646-647. 2431 Id. at 648-650. 2432 Id. at 656. 2433 Id. at 657.
479 that because of a stagnant economy and the congressional shift toward deregulation the enforcement of CERCLA has an uncertain future.2434 14. CERCLA in the Ninth Circuit A 2012 law review article reviews some significant cases in the Ninth Circuit on environmental law.2435 Four cases relating to CERCLA are discussed, including Redevelopment Agency of the City of Stockton v. BNSF Railway Co., supra, part XX.B.6. The article examines the application of CERCLA to railroads and other entities, such as manufacturers2436 and maritime bodies,2437 based on recent cases decided by the Ninth Circuit.2438 15. Remedies Available under State Statutory and Common Law for Damages and other Relief for Contaminated Property In a 2012 law review article Professor Alexandra Klass makes a strong case for the importance of state statutory and common law in claims for contaminated property.2439 The author notes that in more âmodestâ cases the âreal moneyâ is not âin the cleanup costs one can recover under CERCLA or state superfund laws. Instead, it is in the damages that are potentially recoverable, including punitive damages, under state common law claims such as nuisance, 2434 Id. at 659. 2435 âCase Summaries 2011 Ninth Circuit Environmental Review Case Summaries,â 42 Envtl. L. 793 (2012). 2436 Id. at 831 (citing Team Enterprises, LLC. v. Western Investment Real Estate Trust, 647 F.3d 901 (9th Cir. 2011)). 2437 Id. at 820 (citing City of Los Angeles v. San Pedro Boat Works, 635 F.3d 440 (9th Cir. 2011)). 2438 Id. at 827. 2439 Alexandra B. Klass, âCERCLA, State Law, and Federalism in the 21st Century,â 41 Sw. L. Rev. 679 (2012).
480 negligence, or strict liability.â2440 Notwithstanding the differences between CERCLA and state statutory or common law, the writer argues that âall of the various standards can be applied without resulting in multiple recoveries or interfering with CERCLA or state cleanup goals.â2441 The article provides an excellent overview of CERCLA, its legislative history, and amendments. The importance of CERCLA cannot be overestimated because the statute is âa vehicle for the federal government, state and local governments, tribes, and private parties to recover costs associated with contamination that occurred in the past, often decades ago, during a time when there were few requirements associated with the disposal of hazardous substances.â2442 Furthermore, â[l]iability under CERCLA is retroactive, joint, and several and is imposed on current as well as past owners and operators of facilities where there has been a release of a hazardous substance, as well as on those who have generated or transported hazardous substances.â2443 Although not summarized in detail here, the article discusses some of CERCLAâs significant limitations, one limitation being that â[p]rivate parties are limited to recovering âresponse costsâ or monies paid toward a cleanup under section 107(a).â2444 The author provides a fairly detailed analysis of the claims that may be made under state statutory and common law, such as âsuperfund-type statutes that allow plaintiffs to recover response costs in a manner similar to that provided under CERCLA.â2445 However, Professor 2440 Id. at 680. 2441 Id. 2442 Id. at 683. 2443 Id. at 684-685. 2444 Id. at 685 (quoting 42 U.S.C. § 9607(a)(4) (limiting recovery to âresponse costsâ)). 2445 Id. at 686.
481 Klass emphasizes that relief under state law is much broader in some states, such as Alaska, Minnesota, and Washington, which âallow recovery for personal injury, lost profits, diminution in value to property, attorneysâ fees, expenses, or other losses stemming from the contamination of property or harm to human health and the environment.â2446 The article identifies Minnesotaâs superfund statute, the Minnesota Environmental Response and Liability Act (MERLA), as one such example.2447 However, in contrast to CERCLA, MERLA imposes liability on current owners and operators of facilities only if they owned or operated the facility at the time the hazardous substance was placed or came to be located on the facility, when the hazardous substance was located in or on the facility but before the release, or during the time of the release or threatened release.2448 Another Minnesota statute, the Minnesota Environmental Rights Act (MERA) may be used to seek injunctive relief.2449 As for claims at common law, the article argues that there are robust remedies available for use in contamination cases, including âclaims of trespass, nuisance, negligence, and strict liability to obtain damages, injunctive relief, and punitive damages in addition to or instead of CERCLA and state superfund claims.â2450 2446 Id. 2447 Id. at 687 (citing Minn. Stat. Ann. §§115B.05, 115B.14 (West 2005)). 2448 Id. 2449 Id. at 689. 2450 Id. at 691. See id. at 691-699 for a discussion of each common law claim.
482 As for preemption of state law by CERCLA, âvirtually all courts are in agreement that Congress did not intend to preempt the field of hazardous substance remediation and did intend to leave considerable room for state law.â2451 Finally, the article includes case studies of claims for contaminated property in Union Pacific Railroad Co. v. Reilly Industries2452 and Kennedy Building Associates v. Viacom.2453 C. Environmental Requirements for Permits for New Facilities Statutes and Regulations 1. The Clean Railroads Act The Clean Railroads Act (CRA) provides in part: Each solid waste rail transfer facility shall be subject to and shall comply with all applicable Federal and State requirements ⦠respecting the prevention and abatement of pollution, the protection and restoration of the environment, and the protection of public health and safety, including laws governing solid waste, to the same extent as required for any similar solid waste management facility, as defined in section 1004(29) of the Solid Waste Disposal Act (42 U.S.C. 6903 (29)) that is not owned or operated by or on behalf of a rail carrier, except as provided for in section 10909 of this chapter.2454 The term solid waste rail transfer facility means the portion of a facility owned or operated by or on behalf of a rail carrier ⦠where solid waste, as a commodity to be transported for a charge, is collected, stored, separated, processed, treated, managed, disposed of, or transferred, when the activity takes place outside of original shipping containers....2455 However, the term does not include 2451 Id. at 699. 2452 Id. at 704-712 (citing 215 F.3d 830 (8th Cir. 2000)). 2453 Id. at 712-719 (citing 476 F.3d 530 (8th Cir. 2007)). 2454 49 U.S.C. § 10908(a) (2014). 2455 49 U.S.C. § 10908(e)(1)(H)(i) (2014).
483 the portion of a facility to the extent that activities taking place at such portion are comprised solely of the railroad transportation of solid waste after the solid waste is loaded for shipment on or in a rail car ⦠or a facility where solid waste is solely transferred or transloaded from a tank truck directly to a rail tank car.2456 Furthermore, the CRA authorizes the STB under prescribed circumstances to âissue a land-use exemption for a solid waste rail transfer facility that is or is proposed to be operated by or on behalf of a rail carrierâ when, for example, âthe Board finds that a State, local, or municipal law, regulation, order, or other requirement affecting the siting of such facility unreasonably burdens the interstate transportation of solid waste by railroad, [or] discriminates against the railroad transportation of solid waste and a solid waste rail transfer facilityâ¦.â2457 Section 10909(b) sets forth the procedures that govern the submission and review of applications for land-use exemptions for a solid waste rail transfer facility. The CRA provides that âif the Board grants a land-use exemption to a solid waste rail transfer facility, all State laws, regulations, orders, or other requirements affecting the siting of a facility are preempted with regard to that facility. An exemption may require compliance with such State laws, regulations, orders, or other requirements.â2458 2. Requirement for Notice of Intent to Apply for a Land-Use-Exemption Permit A solid waste facility or railroad that owns a facility must first submit a notice of intent to the STB to file an application for a land-use-exemption permit.2459 The applicant is required to 2456 49 U.S.C. §§ 10908(e)(1)(H)(ii)(I) and (II) (2014). 2457 49 U.S.C. § 10909(a)(1) (2014) (some provisions omitted). 2458 49 U.S.C. § 10909(f) (2014). 2459 49 C.F.R. § 1155.20(a) (2014).
484 submit an environmental or historical report forty-five days prior to filing an application.2460 The Office of Environmental Assessment (OEA) is authorized to reject any report that it finds to be inadequate.2461 If the applicant or STB hires a third party consultant, and the OEA approves the consultantâs work in preparing an EIS, the normal requirements for environmental reporting are waived.2462 In fact, â[t]he Board strongly encourages applicants to use third-party contractors to assist [the] OEA in preparing the appropriate environmental documentation in land-use- exemption-permit proceedings.â2463 3. Board Determinations on an Exemption Permit Pursuant to 49 U.S.C. § 10909 and the regulations thereto â[t]he Board will issue a land- use-exemption permit only if it determines that the facility at the existing or proposed location would not pose an unreasonable risk to public health, safety, or the environmentâ and meets or qualifies for the other statutory requirements and exemptions.2464 Case 4. Preemption of State Regulations by the Interstate Commerce Commission Termination Act In New York Susquehanna and Western Railroad Corp. v. Jackson2465 the issue was whether the Interstate Commerce Commission Termination Act (ICCTA) preempted state 2460 49 C.F.R. § 1155.20(c) (2014). 2461 Id. 2462 49 C.F.R. §§ 1155.20(a) and (c) (2014). 2463 49 C.F.R. § 1155.24(c) (2014). 2464 49 U.S.C. § 10901 (2014). See also, 49 U.S.C. § 10901(2) (2014) and 49 C.F. R. §§ 1155.26(b)(1)- (3) (2014). 2465 500 F.3d 238 (3d Cir. 2007).
485 regulations for the practice of transloading solid waste from a truck to a railroad car and related facilities. The case addresses the requirements for new rail facilities that are constructed to store solid waste so that they will meet environmental standards. The New York Susquehanna and Western Railroad Corp. (NYSW) argued that because federal regulations preempted the state regulations the railroad did not have to follow state regulations.2466 The NYSWâs activities qualified as âtransportation by rail carrierâ and came within the ICCTA;2467 however, a âstate law that affects rail carriage survives preemption if it does not discriminate against rail carriage and does not unreasonably burden rail carriage.â2468 The Third Circuit emphasized that local regulations may not âbe so open-ended as to all but ensure delay and disagreement[] or actually be used unreasonably to delay or interfere with rail carriage.â2469 The court further explained that âsome regulations ⦠give too much discretion to survive a facial challenge because they invite delay. In addition, even a regulation that is definite on its face may be challenged as-applied if it is enforced unreasonably or âused as a pretext to carry out a policy of delay or interference.â2470 If challenged, such regulations may be preempted.2471 The court vacated an injunction against New Jersey that had prevented the state from enforcing the 2466 Id. at 246. 2467 Id. at 257. 2468 Id. at 254. 2469 Id. 2470 Id. at 254-255. 2471 Id.
486 regulations and remanded the case for further fact-finding and a consideration of each individual regulation.2472 Articles 5. Railroad Deregulation and Waste Transfer Stations and the Presumption against Preemption An article in the Ecology Law Quarterly states that â[u]nregulated railroad transfer stations have been opening and operating with impunity over the last few years in densely populated areas on the East and West Coasts.â2473 The article argues that the â[p]reemption doctrine is potentially a great obstacle to progressive state policies.â2474 The article further argues that âthe rules of some states are more protective than proposed or existing federal rulesâ and that âcitizens are left without any protections because no federal agency has assumed responsibility for overseeing environmental compliance at transfer facilities once state and local regulations are preempted.â2475 The author uses railroad facilities that process solid waste as a way to explore the preemption doctrine. The author argues principally, first, that [a] confluence of circumstances has created a regulatory gap: solid waste transfer stations are regulated solely by the states, and the federal government has no regulatory apparatus to oversee railroadsâ operation of such facilities. Railroads claim they are exempt from many types of state regulation because of Congressâs unrelated efforts to deregulate railroad economics in the Interstate Commerce Commission Termination Act of 1995 (ICCTA). Statutory ambiguity regarding the scope of preemption under ICCTA has led to a split between a broad view of 2472 Id. at 257. 2473 Carter H. Strickland Jr., âRevitalizing the Presumption against Preemption to Prevent Regulatory Gaps: Railroad Deregulation and Waste Transfer Stations,â 34 Ecology L.Q. 1147, 1150 (2007). 2474 Id. at 1151. 2475 Id. at 1150, 1151.
487 ICCTA preemption in the Second, Ninth, and District of Columbia Circuits and a narrow view of preemption in the Third, Sixth, Eighth, and Eleventh Circuits.2476 Second, the author argues that [a]s a result, in cases involving railroad waste stations, lower courts have found state solid waste laws preempted by ICCTA. In their analyses, the courts have ignored the nuances of the statutory text and congressional intent and have failed to apply any presumption against preemption of traditional state regulation of solid waste. The courts have also failed to weigh the fact that their decisions may leave the public without any effective recourse for public health and environmental problems. Instead, the courts have relied on a general interest in uniformity and a general federal interest in protecting railroads as a quintessential form of interstate commerce.2477 According to the author, â[d]espite the obvious risks to public health and the environment from the deplorable conditions at unregulated railroad solid waste facilities, federal courts have preempted state solid waste laws under ICCTA. The absurd result of these decisions is that truck- to-truck and truck-to-barge transfer stations remain highly regulated, but truck-to-rail transfer stations are completely unregulated.â2478 Moreover, ânone of the rail waste station decisions apply or discuss the presumption against preemption, which is intended to protect against overly broad displacement of sovereign state interests.â2479 The article argues for the recasting of the preemption doctrine to protect âagainst overly facile displacement of state law.â2480 Finally, in addition to the courts, the article places part of the responsibility on the STB for the regulatory gap that the author perceives to exist. The article states that the STB asserts 2476 Id. at 1155-1156 (footnotes omitted). 2477 Id. at 1156. 2478 Id. at 1172. 2479 Id. at 1179. 2480 Id. at 1203.
488 âthat any âstate or local permitting process for prior approval of [a] project, or of any aspect of it related to interstate transportation by rail, would of necessity impinge upon the federal regulation of interstate commerce and therefore is preempted.ââ2481 The article argues that the STBâs policy undermines state permit programs and thus opens up regulatory gaps.2482 6. Whether âLittle NEPAâ Laws and State and Local Permitting Requirements are Preempted by the ICCTA A Report published by the Center for Climate Change at Columbia Law School includes an analysis of the effect of NEPA and other federal environmental laws on federal, state and local permitting requirements in the context of new railroad infrastructure for the movement of coal to ports for export.2483 The Report was prompted in part because âthe dominant method for transporting coal within the United States is railâ and that the expected âmajor increase in the volume of U.S. coal exports will require improvements to the infrastructure used to move coal from mines to ports.2484 The Report analyzes the STBâs authority, summarized herein in part XXXIX of the Report, under the ICCTA enacted in 1995. The Report states that the Ninth Circuit held in 1998 in Auburn v. United States2485 that âstate environmental analysis laws may not be applied to 2481 Id. at 1169-1170 (footnotes omitted) 2482 Id. 2483 Columbia Law School, Center for Climate Change Law, Report on âCarbon Offshoring: The Legal and Regulatory Framework for U.S. Coal Exportsâ (July 2011), available at: http://powerpastcoal.org/wp- content/uploads/2011/09/ColumbiaLawSchool_coalexportpolicy11.pdf (last accessed March 31, 2015), hereinafter referred to as âU.S. Coal Legal and Regulatory Framework.â 2484 Id. at 3. 2485 154 F.3d 1025 (9th Cir. 1998).
489 railroad projects.â2486 However, according to the Report, the 2008 Clean Railroads Act âoverturned the Ninth Circuitâs broad reading of ICCTA preemption in Auburnâ¦.â2487 Nevertheless, âsignificant uncertainty remains in the absence of future litigation to determine the precise contours of the relationship between the ICCTA and the Clean Railroads Act on this question.â2488 The Report points out that under the Clean Railroads Act ââunreasonably burdensomeâ state laws remain preempted by the ICCTA.â2489 The Report observes that in 2010 in American Railroads v. South Coast Air Quality Management District2490 âthe Ninth Circuit struck down a local air pollution law regulating idling locomotives because it applied only to railroads.â2491 The Report states that although most rail improvements supporting the expansion of coal exports do not require an STB permit, the STB permitting process for the extension of new lines, where they are needed, provides perhaps the best avenue for influencing coal export plans. Although the standards used by the STB under its organic statute tend to be amenable to railroads, the grant by the agency of a permit triggers environmental analysis under NEPA, providing citizens with the opportunity to engage in the decision making processes regarding rail infrastructure.2492 In addition, 2486 U.S. Coal Legal and Regulatory Framework, supra note 2483, at 6. 2487 Id. at 7. 2488 Id. 2489 Id. 2490 622 F.3d 1094, 1097-98 (9th Cir. 2010). 2491 U.S. Coal Legal and Regulatory Framework, supra note 2483, at 7. 2492 Id. at 8.
490 the grant by the [STB] of a permit triggers environmental analysis under NEPA, providing citizens with the opportunity to engage in the decision making processes regarding rail infrastructure, as well as ⦠[under] other impact analysis statutes like the National Historic Preservation Act (NHPA).2493 The Report further explains that although the Clean Air Act applies to railroadsâ violations of the Actâs emission standards the Act only applies after the commencement of operations and not to plans for the construction of new rail lines.2494 As for the effect of NEPA and other environmental laws on state and local permitting regulations that apply to railroad plans to construct new lines and infrastructure, the Report argues that âmost state and local regulations directly targeting railroads or imposing truly burdensome costs on rail development likely will be preempted by the ICCTA.â2495 The Report states that state environmental laws that apply generally to railroads are not preempted as âlong as a given restriction does not unreasonably burden rail traffic or specifically discriminate against railâ but states further that âfew state environmental laws apply specifically to the expansion of rail infrastructure for coal exports.â2496 According to the Report, âlittle NEPAâ laws, while not targeted at or unreasonably burdensome for railroads, [they] impose significant procedural requirements on the construction of new rail infrastructure. Of course, since the ICCTA preempts state permitting of railroads, many projects will not qualify for state environmental analysis. Moreover, little NEPAs cannot in and of themselves be used to impose state permitting requirements on railroads. However, state environmental review may be triggered by any separate state action necessary for railroad infrastructure projects. For example, little NEPA 2493 Id. 2494 Id. at 10 (citing 42 U.S.C. §§ 7401-7671q (2006)). 2495 Id. at 13. 2496 Id. at 14.
491 requirements will apply when a state land management agency grants an easement for a railroad to cross state-owned land.2497 D. Transportation of Hazardous Materials Statutes and Regulations 1. Hazardous Materials Transportation Act The Hazardous Materials Transportation Act (HMTA) authorizes the Secretary of Transportation to issue regulations âfor the safe transportation, including security, of hazardous material in intrastate, interstate, and foreign commerce.â2498 The Secretary is authorized to âdesignate material ⦠or a group or class of material as hazardous when ⦠transporting the material ⦠in a particular amount and form may pose an unreasonable risk to health and safety or property.â2499 The regulations apply, for example, to any person who transports hazardous material in commerce; causes hazardous material to be transported in commerce; or prepares or accepts hazardous material for transportation in commerce; or is otherwise responsible for the safety of transporting hazardous material in commerce.2500 The regulations âgovern safety aspects, including security, of the transportation of hazardous materialâ that the Secretary considers appropriate.2501 2497 Id. at 14-15 (footnotes omitted). 2498 49 U.S.C. § 5103(b)(1) (2014). 2499 49 U.S.C. § 5103(a) (2014) (e.g., explosive, radioactive material, infectious substance, flammable or combustible liquid, solid, or gas, toxic, oxidizing, or corrosive material, and compressed gas). 2500 49 U.S.C. §§ 5103(b)(1)(A)(i)-(vii) (2014) (some provisions omitted). 2501 49 U.S.C. § 5103(b)(1)(B) (2014).
492 2. Regulations Implementing the Hazardous Materials Transportation Act The FRA has implemented regulations to ensure the safety of the transportation by rail of hazardous materials. The safety programs are directed at reducing accidents, casualties, loss of property, and threats to the human environment.2502 The regulations are intended to ensure that the transportation of hazardous material is prohibited unless certain standards are met.2503 The regulations apply to persons who perform pre-transportation or transportation services, including the design, manufacture or inspection of packages that are represented as qualified for the use of hazardous materials. The minimum criteria that must be considered by rail carriers as required by 49 CFR § 172.820 include a thorough analysis of the hazardous materials,2504 the routes to be used,2505 a description of the threats identified, and vulnerabilities and mitigation measures to address the vulnerabilities.2506 Cases 3. Tension between Environmental Requirements and the Fourth Amendment In Wisconsin Central Limited v. Gottlieb2507 the Wisconsin Court of Appeals decided whether the Wisconsin Department of Transportation (DOT) had to have a search warrant to collect soil samples for a study on changing the path of a railroad track. The case arose because 2502 See 49 C.F.R. §§ 225.1-225.3 (2014). 2503 49 C.F.R. §§ 172.1-172.3 (2014). 2504 49 C.F.R. § 172.820(a)(b) (2014). 2505 49 C.F.R. § 172.820(c) (2014). 2506 49 C.F.R. § 172.820(d) (2014). 2507 832 N.W.2d 359 (Wis. Ct. App. 2013).
493 the DOT took soil samples from railroad property when exercising its due diligence in respect to environmental requirements that were necessary prior to road construction.2508 The Wisconsin Central Limited (WCL) had agreed to the construction of a new overpass as part of a settlement agreement with the village of North Fond du Lac. The DOT took soil samples in preparation for the project; however, WCL argued that the DOT conducted an unreasonable search and seizure.2509 Although WCL had revoked its permission to enter its property, the Wisconsin Court of Appeals held that there was no illegal search and seizure because WCL had co-sponsored and consented to the investigation of hazardous materials. The court held that the samples were required to complete the inspection required by the study and to complete the design phase of the project.2510 By consenting to the project WCL impliedly allowed the taking of soil samples required for the projectâs design; thus, the court affirmed a lower court decision denying the railroad injunctive relief. 4. Federal Railroad Safety Act and Preemption of Local Law The issue in CSX Transportation, Inc. v. Williams2511 was whether the Federal Railroad Safety Act (FRSA) preempted the District of Columbiaâs Terrorism Prevention in Hazardous Materials Transportation Emergency Act of 2005 (the D.C. Act) that banned all shipments of certain hazardous materials, including explosives, flammable gases, poisonous gases and other poisonous materials by rail or truck within 2.2 miles of the United States Capitol without a 2508 Id. at 360. 2509 Id. 2510 Id. at 365. 2511 406 F.3d 667 (D.C. Cir. 2005).
494 permit from the District of Columbia Department of Transportation (DCDOT).2512 The District of Columbia Circuit held that the FRSA preempted the D.C. Act because the cityâs prohibition would have a detrimental impact on CSXâs business.2513 A concurring opinion argued that the HMTA also preempted the D.C. Act.2514 In reversing and remanding the case, because CSX demonstrated that it would suffer irreparable harm, the court directed the district court to grant CSX a preliminary injunction. E. National Environmental Policy Act and Requirements Statutes and Regulations 1. National Environmental Policy Act Congress enacted the National Environmental Policy Act (NEPA) in 1969, which President Nixon signed into law on January 1, 1970.2515 NEPA describes when an environmental impact statement (EIS) is required and the information that it must contain, mandates that agencies cooperate in complying with the Act,2516 and requires that administrative procedures conform to national environmental policy.2517 Regulations promulgated by the Council of Environmental Quality (CEQ) for NEPA are found in 40 C.F.R. parts 1500 to 1509. For example, part 1500 sets forth NEPAâs purpose, policy, and mandate. Part 1501 applies to NEPA and agency planning, such as when to prepare 2512 Id. at 669. 2513 Id. at 673. 2514 Id. at 674. 2515 42 U.S.C. § 4321 (2014). 2516 42 U.S.C. § 4332(C) (2014). 2517 42 U.S.C. § 4332 (2014).
495 an environmental assessment (EA);2518 whether to prepare an EIS;2519 who are cooperating agencies;2520 and applicable time limits.2521 Part 1502 contains the requirements for an EIS, including major federal actions that necessitate the preparation of an EIS;2522 preparation of draft, final, and supplemental statements;2523 purpose and need;2524 and alternatives, including the proposed action.2525 2. Department of Transportation The Department of Transportation (DOT) has its own statutory requirements applicable to certain transportation projects that have a âde minimisâ impact on the environment.2526 The Secretary of Transportation has a duty to cooperate with other government agencies in the development of its transportation plans to ensure that the âplans and programs ⦠include measures to maintain or enhance the natural beauty of lands crossed by transportation activities or facilities.â2527 Under 49 U.S.C. § 303, which applies to parks, recreation areas, wildlife or 2518 40 C.F.R. § 1501.3 (2014). 2519 40 C.F.R. § 1501.4 (2014). 2520 40 C.F.R. § 1501.6 (2014). 2521 40 C.F.R. § 1501.8 (2014). 2522 40 C.F.R. § 1502.4 (2014). 2523 40 C.F.R. § 1502.9 (2014). 2524 40 C.F.R. § 1502.13 (2014). 2525 40 C.F.R. § 1502.14 (2014). 2526 49 U.S.C. § 303(d) (2014). 2527 49 U.S.C. § 303(b) (2014). For example, the DOT must cooperate with the Department of Agriculture, the Department of the Interior, the Department of Housing and Urban Development and with the states. 23 C.F.R. § 774.5(a) (2014).
496 waterfowl refuges, and historic sites, the Secretary may approve a project requiring the use of public land only if there is no alternative to using the land and there are plans in place to minimize harm to the site and wildlife. If certain criteria are met, the Secretary also is authorized to make a finding that a transportation program or project will have a de minimis impact on historic sites or parks, recreation areas, wildlife, or waterfowl refuges.2528 The DOT Secretary is a member of the Cabinet Committee for the Environment that is tasked with securing the cooperation of federal, state, and local governments and private organizations.2529 3. Federal Railroad Administration The FRA and the STB are subject to NEPA because both engage in âmajor federal actions affecting the human environmentâ and thus are required to have environmental assessments or environmental impact statements as appropriate.2530 An applicant for FRA financial assistance or another major federal action subject to the jurisdiction of the FRA âmay be requested to perform an environmental assessment of the proposed FRA action and to submit documentation of that assessment with the applicationâ and also may be requested âto submit a proposed draft EIS or proposed [Finding of No Significant Impact] in connection with the applicationâ¦.â2531 2528 49 U.S.C. § 303(d) (2014). 2529 42 U.S.C. § 4332(2)(c) (2014). 2530 42 U.S.C. § 4332 (2014). 2531 United States Department of Transportation, Federal Railroad Administration, Procedures for Considering Environmental Impacts, 64 Fed. Reg. 28545, 28549 (May 26 1999), available at: http://www.gpo.gov/fdsys/pkg/FR-1999-05-26/pdf/99-13262.pdf (last accessed March 31, 2015), hereinafter referred to as âProcedures for Considering Environmental Impacts.â
497 The FRA has developed procedures to comply with and expand on the CEQâs regulations.2532 The FRAâs regulations state in part that when an applicant requests âsubstitute service assistance, rail facility construction assistance, or rehabilitation or improvement assistanceâ (except for exempt rehabilitation or improvement assistance), the applicant must prepare an EA.2533 The EA is used to determine whether the future use of the property will significantly affect the quality of the human environment and/or to provide sufficient documentation to enable the Administrator to determine that the project satisfies certain specified criteria.2534 The FRA recommends that prior to submitting an application an applicant seek the Administratorâs advice regarding the âform and substance of the assessment for the project under consideration.â2535 The FRA will decide whether the proposed action is a major federal action and whether more environmental documents are needed.2536 After evaluating the documents, the FRA will decide whether to issue a Finding of No Significant Impact (FONSI) (see section E.6.d); whether the action qualifies for a categorical exclusion or CE (see section E.6.c); or whether an EIS is required (see section E.6.e.).2537 A draft EIS is to be submitted when an EA âconcludes that the future use significantly affects the quality of the human environment.â2538 2532 40 C.F.R. §§ 1500.3, 1505.1, 1507.3, and 1502.2 (2014). 2533 49 C.F.R. § 266.19(b)(1) (2014). 2534 Id. 2535 Id. 2536 40 C.F.R. § 1508.9 (2014); see Procedures for Considering Environmental Impacts, supra note 2531. 2537 Procedures for Considering Environmental Impacts, supra note 2531, at 28553. 2538 49 C.F.R. §§ 266.19(b)(1)(ii) and (b)(2) (2014).
498 When an EIS is required the FRAâs Program Office will commence the preparation of the EIS with the Office of Chief Counsel.2539 The Draft EIS may be released after the Administratorâs approval.2540 Once released, the period for public notice and comment is to be at least forty-five days.2541 An EIS becomes final on its approval by the Administrator.2542 5. Surface Transportation Board The STB is responsible for overseeing the construction, acquisition, mergers, or abandonment of railroads, whereas the FRA is responsible for the safety of railroads. In 2002, the STB and FRA issued final rules that allow the agencies to coordinate the integration of safety issues related to a consolidation or merger of railroads. Because each agency has its own regulations that must be satisfied, the rules will facilitate the agenciesâ coordination of their responsibilities.2543 The STB is responsible for ensuring that railroads meet the requirements of NEPA for actions that are subject to NEPA and to the Boardâs jurisdiction.2544 The STB has exclusive jurisdiction over transportation by rail carriers; remedies with respect to rates, classifications, 2539 Procedures for Considering Environmental Impacts, supra note 2531, at 28553. 2540 Id. 2541 Id. 2542 Id. 2543 See Final Rule âRegulations on Safety Integration Plans Governing Railroad Consolidations, Mergers, and Acquisitions of Control,â 67 Fed. Reg. 11604 (Mar. 15, 2002); 49 C.F.R. parts 244 and 1106. See also, Progressive Railroading, STB, FRA Team up to Tame Merging-Railroad Integration, available at http://www.progressiverailroading.com/rail_industry_trends/news/STB-FRA-team-up-to-tame- mergingrailroad-integration--5718 (last accessed March 31, 2015). 2544 42 U.S.C. § 4332 (2014).
499 rules, practices, routes, services, and facilities; and the âconstruction, acquisition, operation, abandonment, or discontinuance of spur, industrial, team, switching, or side tracks, or facilities, even if the tracks are located, or intended to be located, entirely in one Stateâ¦.â2545 The STB has promulgated regulations to assure that its decision-making processes comply with NEPA.2546 The regulations provide in part that [t]he Chief of the Section of Environmental Analysis is responsible for the preparation of documents under these rules and is delegated the authority to provide interpretations of the Boardâs NEPA process, to render initial decisions on requests for waiver or modification of any of these rules for individual proceedings, and to recommend rejection of environmental reports not in compliance with these rules.â2547 In the absence of the STBâs approval, railroad companies may not proceed with certain proposed activities such as construction or mergers with other companies.2548 Section 11324(c) states that â[t]he Board shall approve and authorize a transaction under this section when it finds [that] the transaction is consistent with the public interest.â2549 To satisfy the Boardâs obligations under NEPA, after the notice of an application is published in the Federal Register for public notice and comment,2550 the Board must take environmental considerations into account; âaddress[] concerns raised by the parties, including federal, state, and local government 2545 49 U.S.C. § 10501(b) (2014). 2546 49 C.F.R. §§ 1105.1 and 1105.2 (2014). 2547 49 C.F.R. § 1105.2 (2014). 2548 49 U.S.C. §§ 10901 and 11324 (2014). 2549 49 U.S.C. § 11324(c) (2014). 2550 49 U.S.C. § 11325(a) (2014).
500 entities;â2551 and encourage railroads to make private agreements with local communities to address specific local concerns.2552 The Board emphasizes public participation âto ensure a fully developed record on the effects of a proposed railroad consolidation.â2553 The Board is required to consider the publicâs comments in its decision-making process.2554 The STB may require that an applicant comply with certain conditions, including environmental ones, that the STB finds are necessary and in the public interest.2555 6. Railroads, Environmental Documents, and Findings a. Environmental Reports An applicant for an action identified in 49 C.F.R. §§ 1105.6(a) and (b) (that is, a proposed action that may require an EIS or an EA, respectively) must submit, except in the situations noted in the regulations not discussed herein, an Environmental Report (ER) on the proposed action containing the information required by § 1105.7(e)(1)-(10).2556 2551 49 C.F.R. § 1180.1(f)(1) (2014). 2552 49 C.F.R. §1180.1(f)(2) (2014). 2553 49 C.F.R. §1180.1(m) (2014). 2554 49 U.S.C. § 11324(a) (2014) (stating that â[t]he Board shall hold a public hearing unless the Board determines that a public hearing is not necessary in the public interestâ). 2555 49 U.S.C. § 10901(c) (2014). Subpart (c) provides: The Board shall issue a certificate authorizing activities for which such authority is requested in an application filed under subsection (b) unless the Board finds that such activities are inconsistent with the public convenience and necessity. Such certificate may approve the application as filed, or with modifications, and may require compliance with conditions (other than labor protection conditions) the Board finds necessary in the public interest. 2556 49 C.F.R. § 1105(7)(a) (2014).
501 The ER must describe the proposed action and any reasonable alternatives; describe the effects of the proposed action on regional or local transportation systems and patterns; estimate the amount of traffic that will be diverted; provide details on land and whether the proposed action is consistent with existing land use plans; describe the effect of the proposed action on the transportation of energy resources and whether (and why) the proposed action will result in an increase or decrease in overall energy efficiency; and provide details on any hazardous materials that are expected to be transported.2557 Additional information is required for proposed rail construction.2558 b. Environmental Assessment The STB and FRA may require either an EIS or an EA but an EA must be prepared prior to all major FRA actions.2559 An EA is for the purpose of providing sufficient evidence and analysis for determining whether to require an EIS or to issue a FONSI. An EA assists an agency in complying with NEPA when an EIS is not required, as well as in facilitating the preparation of an EIS when one is necessary.2560 An EA â[s]hall include brief discussions of the need for the proposal, of alternatives as required by section 102(2)(E), of the environmental impacts of the proposed action and alternatives, and a listing of agencies and persons consulted.â2561 2557 49 C.F.R. §§ 1105.7(e)(1)-(10) and (f) (2014). 2558 49 C.F.R. §§ 1105.7(e)(11)(i)-(vii) (2014). 2559 40 C.F.R. § 1508.4 (2014). 2560 40 C.F.R. § 1508.9(a) (1)-(3) (2014). 2561 40 C.F.R. § 1508.9(b) (2014). See Environmental Protection Agency, National Environmental Policy Act, available at: http://www.epa.gov/compliance/basics/nepa.html (last accessed March 31, 2015).
502 With some exceptions, an EA normally is prepared for any of the following as well as other proposed actions specified in the regulations: construction of connecting track within existing rail rights-of-way or on land owned by the connecting railroads; abandonment, with one exception noted, of a rail line; discontinuance, with some exceptions noted, of passenger train service or freight service; an acquisition, lease, or operation under 49 U.S.C. §§ 10901 or 10910, or consolidation, merger, or acquisition of control under 49 U.S.C. § 11343 when the action will result in either operational changes exceeding certain thresholds as noted; or an action that would normally require environmental documentation, such as construction or an abandonment.2562 As is the case of an EIS, an EA is made available for public comment and is announced by a notice in the Federal Register.2563 Members of the public generally have thirty days to submit comments on the EA.2564 c. Categorical Exclusions A proposed action may qualify for a categorical exclusion (CE), meaning that an EA or an EIS is not required.2565 CEs are actions that âdo not individually or cumulatively have a significant effect on the human environment and [that] have been found to have no such effect in procedures adopted by a Federal agency in [the] implementation of these regulationsâ¦.â2566 However, â[a]n agency may decide in its procedures or otherwise, to prepare environmental 2562 49 C.F.R. §§ 1105.6(a) and (b)(1)-(4) (2014). 2563 49 C.F.R. § 1105.10(b) (2014). 2564 Id. 2565 40 C.F.R. § 1508.4 (2014). 2566 Id.
503 assessments for the reasons stated in [40 C.F.R. § 1508.9] even though it is not required to do so.â2567 The FRA has listed approximately twenty categories of actions that are categorically excluded from further environmental procedures because they do not individually or cumulatively have a significant effect on the human environment.2568 For example, actions that are categorically excluded include financial assistance or procurements for planning or design activities that do not commit the FRA or its applicants to a particular course of action affecting the environment.2569 There are more actions that are excluded by the CEQ regulations, including grants to Amtrak, enforcement of safety regulations, and issuance of emergency orders.2570 Finally, there are actions that may qualify for a CE that are not already identified by the FRA when an action satisfies approximately seven criteria. One criterion is when a proposed action is one that âis not judged to be environmentally controversial from the point of view of people living within the environment affected by the action or controversial with respect to the availability of adequate relocation housing.â2571 d. A Finding of No Significant Impact The FRAâs procedures for considering environmental impacts also include a Finding of no Significant Impact or FONSI. Under the FRAâs procedures â[a] FONSI shall be prepared for all major FRA actions for which an environmental impact statement is not required[] as 2567 Id. 2568 49 C.F.R. § 266.19 (2014); Procedures for Considering Environmental Impacts,â supra note 2531. 2569 Procedures for Considering Environmental Impacts, supra note 2531, at 28547-28548. 2570 Id. at 28548. 2571 Id.
504 determined in accordance with section 10(e) of these Procedures.â2572 Furthermore, â[n]o decision shall be made at any level of authority of the FRA to commit the FRA or its resources to a major FRA action for which a FONSI must be prepared until a FONSI covering the action has been prepared and approved in accordance with this section.â2573 e. Environmental Impact Statement As stated, NEPA requires that all federal agencies submit a âdetailed statementâ on the environmental impact of any proposed major federal action.2574 For example, an EIS normally will be prepared for proposals for rail construction other than for the construction of connecting track within existing rail rights-of-way or on land owned by the connecting railroads.2575 If an EIS is determined to be required it must address the environmental impact of the proposed action; any adverse environmental effects that cannot be avoided if the proposal is implemented; alternatives to the proposed action; âthe relationship between local short-term uses of manâs environment and the maintenance and enhancement of long-term productivity;â and âany irreversible and irretrievable commitments of resources which would be involved in the proposed action should it be implemented.â2576 An EIS is to be made available for public notice and comment. Thus, when an EIS âis prepared for a proposed action[] the Board will publish in the Federal Register a notice of its 2572 Id. at 28551. 2573 Id. 2574 42 U.S.C. § 4332(2)(C) (2014). 2575 49 C.F.R. § 1105.6(a) (2014). 2576 National Environmental Policy Act, § 102(c); 42 U.S.C. §§ 4332(C)(i)-(v) (2014).
505 intent to prepare an EIS ⦠and a request for written comments on the scope of the EIS.â2577 Part of the scoping process for an EIS may include meetings open to the public and other interested parties.2578 Once the draft EIS is available, it generally will be made available for forty-five days for written comments.2579 If there is to be an oral hearing concerning the merits of a proposal, an EIS generally will be made public fifteen days prior to the hearing.2580 Cases 6. Judicial Review of Petitions Challenging an STB Decision In Alaska Survival v. Surface Transportation Board2581 the Ninth Circuit considered whether environmental requirements under NEPA and the provisions of the Interstate Commerce Commission Termination Act (ICCTA) governing railroad expansions allow the court to review a decision of the STB. The court interpreted the STBâs authority to exempt a railroad from the full licensing provisions of 49 U.S.C. § 10901 that are required to authorize the construction and operation of a railroad line. In making its decision on an exemption the STB must balance public need with NEPA compliance.2582 The STB may grant an exemption if the project is either of limited scope or if full statutory proceedings are not necessary to protect shippers from an abuse of market power. The STB has discretion to determine the public needs that the Board will 2577 49 C.F.R. § 1105.10(a)(2) (2014). 2578 Id. 2579 49 C.F.R. § 1105.10(a)(4) (2014). 2580 Id. 2581 705 F.3d 1073 (9th Cir. 2013). 2582 Id. at 1076.
506 consider.2583 In Alaska Survival the petitioners alleged that the expansion would damage wetlands and habitats for âwolves, bear, foxes, salmon, and other wildlife.â2584 The STB granted the exemption after it determined there was sufficient public need and procedures to mitigate environmental impacts.2585 The court ruled that the STB considered sufficient alternatives to satisfy the public and private objectives for the project and to make an informed decision on whether to grant an exemption.2586 An EIS does not need âto consider an infinite range of alternatives, only reasonable or feasible onesâ¦. But failure to examine a reasonable alternative renders an EIS inadequate.â2587 The court held that the STBâs measures and procedures were sufficient under the ICCTA. There was no error under NEPA because the purpose and need statement was adequate.2588 The STB considered all viable and reasonable alternatives, and the EIS contained a detailed and thoughtful discussion of the environmental impacts.2589 Thus, there was no violation of the ICCTA, NEPA, or for that matter the Administrative Procedure Act.2590 The court denied the petition for review. 2583 Id. at 1080. 2584 Id. at 1076. 2585 Id. at 1077. 2586 Id. 2587 Id. at 1087. 2588 Id. at 1089. 2589 Id. 2590 Id. at 1088-1089.
507 7. Reasonable Basis for a Finding of no Significant Impact In Township of Belleville v. Federal Transit Administration2591 the town challenged a FONSI for New Jersey Transit (NJT) that as a result authorized federal funds for the design and construction of a project known as the Newark City Subway Extension. The issue was whether the defendants met the required federal statutory provisions for a FONSI. The defendants, who included the executive director of NJT, argued that the proposed construction project was categorically excluded. They noted that actions that do not have significant environmental effects are categorized as âCLASS IIâ and as such are categorically excluded from the requirement for an EIS or EA. Class II projects include those for the updating or maintaining of existing structures rather than for the building of entirely new sections of track or facilities.2592 Thus, the defendants argued that the project should have been classified as a CE that required neither an EIS nor an EA.2593 First, the court held the FTA acted reasonably in requiring an EA to be prepared because â[t]he base facility is to be constructed on a site zoned for industrial purposesâ and because â[t]hat portion of the project falls squarely within the categorical exception.â2594 Although the upgrading of the Conrail track usually would âfall within the categorical exclusion ⦠a question remained as to whether the environmental impacts due to the extension of subway service and increase in activity on the tracks would be significant.â2595 The court held that the FTA correctly 2591 30 F. Supp.2d 782, 785 (D. N.J. 1998). 2592 Id. at 797-799. 2593 Id. at 797. 2594 Id. at 798. 2595 Id.
508 classified the project as a Class III project, one for which âthe significance of the environmental impact is not clearly established,â and required an EA to determine which environmental document was required.2596 Second, the plaintiff argued that because the project presented âa substantial possibility of significant impactsâ the âFTA acted unreasonably in issuing a FONSI for the project based on the EA[] without requiring an EIS.â2597 The court held, however, that âthe EA submitted to the FTA provides a detailed analysis of the traffic impacts of the projectâ and that âthe EAâs conclusion that the project will not cause significant environmental impacts in terms of trafficâ was reasonable.2598 The court made identical findings concerning other impacts of the project, including any impact on pedestrian safety.2599 The court held that the FTA acted reasonably in issuing a FONSI and granted the defendantsâ motions for a summary judgment. 8. Requirement that the STB take a Hard Look when Considering Environmental Impacts In Northern Plains Resource Council v. Surface Transportation Board2600 the Ninth Circuit considered the issue of whether a railroad companyâs applications to build new track were properly approved based on NEPA and public necessity and convenience. The STB had approved the railroadâs applications to expand its lines through southeastern Montana, but the petitioners challenged the STBâs approval on environmental and public convenience and 2596 Id. 2597 Id. at 799-800. 2598 Id. at 801. 2599 Id. at 803. 2600 668 F.3d 1067 (9th Cir. 2011).
509 necessity grounds. The petitioners argued that the STBâs approval was in error because outdated information had been used in completing the EIS.2601 Judicial review of the Boardâs decision under NEPA is limited to whether the agency took a âhard lookâ based on a strict interpretation of NEPAâs requirements.2602 To satisfy NEPA an EIS must consider the cumulative environmental impacts that a proposed action may have.2603 The court held that the Board did not satisfy NEPAâs requirements in its preparation of the EIS, in part because of the use of outdated aerial survey photographs. The courtâs opinion addresses many issues concerning the STBâs data or lack thereof. Even though the STB is required to consider future implications, the Board failed to include relevant data in respect to many of the environmental impacts presented; for example, âthe Board has not sufficiently explained why it cannot or should not incorporate ⦠available data concerning likely future development into its environmental impact analysis.â2604 Although the court upheld the STBâs analysis of public necessity and convenience,2605 the court ruled that the STB did not take the requisite hard look at the particular environmental impacts presented by the two applications as required by NEPA. The STBâs decision was arbitrary and capricious for failing to consider the evidence.2606 The Ninth Circuit affirmed the STBâs decision in part and reversed and remanded it in part to the STB.2607 2601 Id. at 1071-1074. 2602 Id. at 1075-1077. 2603 Id. at 1077. 2604 Id. at 1079, 1086-1087. 2605 Id. at 1093. 2606 Id. at 1088.
510 9. The STBâs Authority to Impose Environmental Conditions on Minor Mergers Village of Barrington v. Surface Transportation Board2608 involved a merger of Canadian National, a Class I railroad, and Elgin, Joliet & Eastern Railway Company (EJE) in and around Chicago. Before the acquisition of EJE could be completed, Canadian National had to obtain the STBâs approval.2609 Because the acquisition involved only one Class I railroad, the STB classified the transaction as a minor merger. The STB, therefore, had to approve the transaction within 180 days unless the STB determined that the merger was likely to cause substantial anticompetitive effects.2610 Finding that the merger would result in a substantial increase in freight traffic that would ââsignificantly affect[] the quality of the human environment,ââ2611 the Board directed its section on environmental analysis to prepare an EIS that the Board would use âto decide whether to impose âenvironmental mitigation conditionsâ if and when it approved the transaction.â2612 Ultimately, the STB exercised its environmental authority by imposing conditions that would mitigate the effects of the merger, as well as by requiring âCanadian National to comply 2607 Id. at 1099. Earlier the court stated that â[s]ection 706 of the Administrative Procedure Act (APA) governs judicial review of agency decisions made pursuant to NEPA. An agencyâs decision must be upheld unless it is âarbitrary and capricious, with an abuse of discretion, or otherwise not in accordance with law.ââ Id. at 1074 (citing 5 U.S.C. § 706). 2608 636 F.3d 650 (D.C. Cir. 2011), subsequent appeal, petition denied, 2014 U.S. App. LEXIS 13720 (D.C. Cir., July 18, 2014). 2609 Id. at 653 (citing 49 U.S.C. § 11323). 2610 Id. (citing 49 U.S.C. §§ 11324(d) and 11325(a) and (d)). 2611 Id. (citing 42 U.S.C. § 4332(2)(C)). 2612 Id.
511 with voluntary mitigation commitments negotiated with several affected communities.â2613 After the acquisition was complete, Canadian National filed a petition for review that challenged âCondition 14â for being both âunlawful and arbitrary and capricious.â2614 Numerous local governmental entities, including the Village of Barrington, also filed petitions for review that challenged the Boardâs compliance with NEPA.2615 The District of Columbia Circuit considered whether the Staggers Rail Act deprived the STB of authority to impose environmental conditions on minor mergers. Congress enacted the Staggers Rail Act to deregulate railroads and in part to âexpedite approval of smaller mergers.â2616 The court held that ânothing in [49 U.S.C. § 11324] unambiguously forecloses the Board from imposing environmental conditions on âminorâ mergers.â2617 The court held that given the statuteâs ambiguity âa range of interpretations is permissible[] and that the Boardâs current interpretation falls within that range.â2618 Furthermore, the court held that â[t]he Board did all that NEPA required of itâ because the STB set out the purpose and need for the transaction, evaluated alternatives that would reasonably and feasibly accomplish that purpose and need, identified and took a âhard lookâ at the transactionâs environmental impacts, examined strategies for 2613 Id. at 657. 2614 Id. at 654. 2615 Id. at 654-655. 2616 Id. at 657. 2617 Id. at 664-655. 2618 Id.
512 mitigating those impacts, and fielded and responded to thousands of comments from local, state, and federal agencies and from the community.2619 Thus, the court denied the petitions for review because the Staggers Rail Act did not foreclose the STB from imposing environmental conditions on minor mergers and because the court âfound no âerror[s] [that] compromise[d] the objectivity and integrity of the [NEPA] processâ¦.â2620 10. Requirement of Cooperation of Federal and State Agencies Judicial Watch Inc. v. United States Department of Transportation2621 concerned a joint agreement of the FRA and the California High Speed Rail Association (CHSRA) to work together to create Environmental Impact Reports (EIR). The FRA and CHSRA were co-lead agencies with the FRA responsible for compliance with NEPA and with CHSRA responsible for compliance with the California Environmental Quality Act (CEQA). Although the case involved a request under the Freedom of Information Act, a District of Columbia federal court analyzed the FRAâs obligations under NEPA to cooperate with other agencies and state and local governments. Because NEPA requires federal and state agencies to work together, and FRA and CHSRA were doing so, the court granted the defendantâs motion for a summary judgment. 11. Requirement that STB Cooperate with other Agencies In Medina County Environmental Action Association v. Surface Transportation Board2622 the Medina County Environmental Action Association (MCEAA) petitioned for a review of the 2619 Id. at 673-674. 2620 Id. at 673. 2621 950 F. Supp.2d 213 (D. D.C. 2013). 2622 602 F.3d 687 (5th Cir. 2010), amended petition denied, motion denied, 2010 U.S. App. LEXIS 9326 (5th Cir., Apr. 6, 2010).
513 STBâs decision that allowed a railroad to construct and operate a rail line to service a quarry. The petitioner argued that the STB and the United States Fish and Wildlife Service (FWS) failed to comply with 16 U.S.C. § 1536(a)(2) of the Endangered Species Act (ESA). ESAâs regulations permit an agency to conduct a biological assessment as part of an EIS that is prepared in compliance with NEPA.2623 In assessing whether a proposed rail line is âlikely to jeopardizeâ endangered or threatened species or their habitats, the STB is required to consult with the FWS.2624 The issue was whether the STB improperly granted an exception without consulting with other agencies, namely the FWS. However, the STB had initiated an âinformal consultation,â the first step of which was to âdetermine whether an endangered or threatened species, or âcritical habitatâ for such species, may be present in the vicinity of the proposed actionâ¦. If no such species or critical habitat may be present, no further consultation is required; if they may be present, then the informal consultation proceeds to the second step.â2625 Because of information developed during the first step âthe informal consultation proceeded to the second stepâ when the STB was required to conduct a ââbiological assessmentâ of the effects of the proposed action.â2626 The court held that the STBâs informal consultation 2623 Id. at 695. 2624 Id. at 693 (citing 16 U.S.C. § 1536(a)(2)) (footnote omitted). 2625 Id. (citations omitted) (footnotes omitted). âAn âinformal consultationâ is âan optional process that includes all discussions, correspondence, etc., between the [FWS] and the Federal agency ⦠designed to assist the Federal agency in determining whether formal consultation or a conference is required.ââ Id. 2626 Id. at 694 (quoting 16 U.S.C. § 1536(c)(1)).
514 with the FWS combined with the EIS was sufficient to satisfy procedural requirements.2627 The court denied MCEAAâs petition for review. 12. State Environmental Law and Archaeological Impact Statements In Kaleikini v. Yoshioka,2628 although the construction of a rail line had been approved, the line likely would disturb archeological artifacts. The petitioner brought an action against the city and county of Honolulu and the state of Hawaii to challenge the approval of the Honolulu High-Capacity Transit Corridor Project that involved the construction of a fixed guideway rail system approximately twenty miles in length. All parties agreed that âthe rail project has a âhighâ likelihood of having a potential effect on archeological resources in certain areas of Phase 4 that includes Kakaâako.â2629 The petitioner argued that the city and the Department of Land and Natural Resources (DLNR) violated certain provisions of the Hawaii statutes. The petitioner argued that an Archeological Impact Statement (AIS) prior to construction had to be completed for the entire project and sought a declaration that an AIS must be prepared for the rail project prior to âdecision-making on the project and/or [its] commencement.â2630 The petitioner sought a declaration that the final EIS was âunacceptableâ under the law because it did not include an AIS and was inadequate also because the EIS did not consider the impacts that the construction 2627 Id. at 693. 2628 283 P.3d 60 (Haw. 2012). 2629 Id. at 63. 2630 Id. at 68.
515 would have on native artifacts.2631 The city, on the other hand, argued that the EIS satisfied the cityâs obligations. The Supreme Court of Hawaii agreed with the city in holding that the EIS only needed to comply âin good faithâ with the regulatory requirements, a test that the EIS satisfied, first, because it considered alternatives and the impacts on water, air, wildlife, as well as other impacts, and, second, because it proposed mitigation measures.2632 The court further held that the EIS only needed in good faith to include documentation and recommendations for the mitigation of impacts on archeological artifacts.2633 The court stated: [C]hapter 4.16 of the final EIS concerns archaeological, cultural, and historic resources. The EIS divided the rail corridor into ten different sub-areas to âevaluate below-ground effects on archaeological resources within the study corridor[]â and developed a qualitative rating system to describe potential archaeological impacts in each sub-area. ⦠The EIS concluded that the potential for encountering burials in the Dillingham, Downtown, and Kakaâako areas was high.2634 With regard to mitigation, the EIS noted that â[t]he Project will have an âeffect, with proposed mitigation commitmentsâ under State law[.]â Based on the foregoing, âthe EIS discussion concerning [archaeological resources] was compiled in good faith and sets forth sufficient information to enable the decision-maker to consider fully the environmental factors involved.â2635 2631 Id. 2632 Id. at 83. 2633 Id. at 84. 2634 Id. at 90. 2635 Id. (citations omitted).
516 The Supreme Court of Hawaii partially affirmed a summary judgment because âthe final EIS was sufficient under HRS chapter 343â and because the city and state âgave full consideration to cultural and historic values as required under HRS chapter 205A.â2636 13. Environmental Impact Statement Required to Consider Socioeconomic Impacts on the Local Population In Saint Paul Branch of the National Association for the Advancement of Colored People v. United States Department of Transportation,2637 involving the proposed construction of a light rail project, the issue was whether the final EIS (FEIS) failed to consider properly the impact of the construction on a primarily African-American residential neighborhood with low-income businesses. Although the EIS that had been submitted was sufficient to satisfy NEPA requirements, a proposed light rail line through a predominantly black neighborhood required an EIS exploring the socioeconomic impact.2638 A Minnesota federal court, emphasizing that NEPA ârequires federal agencies to prepare an EIS for âmajor federal actions significantly affecting the quality of the human environment,ââ2639 held that there had been sufficient analysis within the EIS to comply with NEPAâs technical requirements. The FEIS was sufficient in its consideration of the potential displacement of existing businesses and residents.2640 However, the court held that the FEIS was insufficient in its consideration of lost business revenue as a consequence of 2636 Id. at 95. 2637 764 F.Supp.2d 1092 (D. Minn. 2011). 2638 Id. at 1102. 2639 Id. (citation omitted). 2640 Id. at 1115.
517 the light rail construction.2641 Thus, the district court granted a summary judgment in part, denied it in part, and also denied the plaintiffsâ request to enjoin the project.2642 14. STBâs Adequate Consideration of Alternatives and of Horn Noise The Eighth Circuit in Mayo Foundation v. Surface Transportation Board2643 considered an STB decision to approve the updating and building of new rail lines without considering alternative routes. The Mayo Foundation, the City of Rochester, and Olmsted County argued that the Dakota, Minnesota & Eastern Railroad Corporationâs (DM&E) acquisition of over 1,000 miles of existing rail line in Minnesota, Iowa, Kansas, Missouri, Wisconsin, and Illinois from I&M Rail Link (IMRL) constituted âsignificant new circumstancesâ that gave rise to the consideration of the new line as an alternative to routing trains through Rochester. However, the court held that â[t]he Board is required to consider all âreasonableâ alternativesâ but is not required âto consider alternatives that would frustrate the very purpose of the project. [A]n âalternative is unreasonable if it does not fulfill the purpose of the project.ââ2644 The court held that the Board considered âadverse effects of [an] expected increase in horn noiseâ and that the Boardâs âreasoned conclusionsâ regarding mitigating conditions were satisfactory to meet the foregoing standard.2645 The court affirmed the STBâs decision. 2641 Id. at 1112-1113. 2642 Id. at 1119. 2643 472 F.3d 545 (8th Cir. 2006). 2644 Id. at 550 (citations omitted). 2645 Id. at 554.
518 Article 15. NEPA and the Role of Public Comments A recent law review article discusses how the inclusion of public comments has influenced decisions by the courts on the issue of compliance with NEPA.2646 The article is an update of a 1990 study that considered NEPA cases âin which the courts relied on agency comments to arrive at conclusions about NEPA compliance.â2647 The authors state that â[t]wo decades ago, agency comments explained a high percentage of the outcomes of NEPA litigation; twenty-some years later, the correlation between agency comments and case outcomes is somewhat less obvious.â2648 The article âprovide[s] background on NEPAâs requirements for interagency commentsâ¦.;â2649 âevaluates recent cases in which courts employed agency comments to conclude either that an agency improperly failed to produce environmental impact statements, or that the statement an agency produced was inadequate;â2650 discusses cases in which the courts consider âadverse comments from internal lead agency staff;â2651 evaluates âcases in which courts held that lead agencies complied with NEPAâs requirements, relying in part on 2646 Michael C. Blumm and Marla Nelson, âPluralism and the Environment Revisited: The Role of Comment Agencies in NEPA Litigation,â 37 Vt. L. Rev. 5 (2012). 2647 Id. at 7. 2648 Id. 2649 Id. 2650 Id. at 7-8. 2651 Id. at 8.
519 interagency comments supporting the lead agencyâs analysis;â2652 and examines cases in which âcourts made NEPA determinations that were inconsistent with agency comments â a practice that seems to contradict our thesis.â2653 Nevertheless, the authors suggest that public comments also are a vital part of the NEPA process. Article F. Federal Law Preempts Local Districtâs Air Quality Rules As discussed in a recent on line article, California has thirty-five air quality management districts and each is responsible for proposing and creating air quality rules in its district.2654 The South Coast Air Quality Management District had a rule that required idling trains to limit the amount of emissions they release to reduce air pollution.2655 In Association of American Railroads v. South Coast Air Quality Management District,2656 a case involving air pollution emissions from idling trains, the Ninth Circuit held that federal law preempted the local regulations.2657 Railroad carriers in the state, which had sought a permanent injunction against enforcement of three of the districtâs local air quality rules, argued 2652 Id. 2653 Id. 2654 Mike Cherney, 9th Circuit Finds Calif. Railroad Pollution Laws Preempted, Law360, available at: http://www.mayerbrown.com/files/News/1886584c-3771-45fe-a5a6- 088affd3492e/Presentation/NewsAttachment/375bc41b-c80d-4c18-a307-c83b80f1c328/9thCirc- Finds_Calif.pdf (last accessed March 31, 2015), herein referred to as âCherney.â 2655 Id. 2656 622 F.3d 1094 (9th Cir. 2010). 2657 Cherney, supra note 2654.
520 that the ICCTA preempted the rules.2658 The Ninth Circuit explained that â[b]ecause the Districtâs rules have the force of state law [the] ICCTA preempts those rules unless they are rules of general applicability that do not unreasonably burden railroad activity.â2659 The court held that the other two local rules that implemented reporting requirements under the threat of penalties did not meet the standard; therefore, the ICCTA preempted all three of the Districtâs rules at issue.2660 The article states that the holding in Association of American Railroads is consistent with the Ninth Circuitâs ruling in a similar case when âa municipality in Washington state sought to regulate the reopening of a rail line.â2661 The article also notes that the United States Environmental Protection Agency (EPA) has the authority to approve state air quality implementation plans under the Clean Air Act and that after the EPA has approved Californiaâs plans the local rules regulating idling trains have the force of federal law.2662 However, according to the Ninth Circuit, until a state plan is approved âthere is no authority for the courts to harmonize the districtâs rules with ICCTA.â2663 2658 622 F.3d at 1095-1096. 2659 Cherney, supra note 2654 (quoting Association of American Railroads, 622 F.3d at 1098) (citations omitted). 2660 Id. 2661 Id. 2662 Id. 2663 Id. (quoting Association of American Railroads, 622 F.3d at 1098) (citations omitted).
521 XXI. FEDERAL EMPLOYERSâ LIABILITY ACT A. Introduction In 1908, Congress enacted the Federal Employersâ Liability Act (FELA) to ensure that railroad employees who were injured in the course of their employment would be able to recover damages for their injuries.2664 Section B discusses some of FELAâs provisions, including one that an employeeâs âcontributory negligence shall not bar a recovery, but the damages shall be diminished by the jury in proportion to the amount of negligence attributable to such employeeâ¦.â2665 Section C discusses cases deciding whether other federal statutes, such as the Federal Railroad Safety Act (FRSA) or the Locomotive Inspection Act (LIA) preclude claims under FELA. Section D addresses whether some of the principles found in tort law are generally applicable in FELA cases, such as what standard applies to the amount of evidence that a plaintiff must adduce; whether there is a requirement that a plaintiff prove proximate cause; whether railroads may assert counterclaims; and whether the payment of a plaintiffâs medical expenses by a railroad-sponsored health insurance plan affects the amount of damages recoverable by a plaintiff. Section E discusses claims under FELA for infliction of emotional distress, including the zone of danger test and the applicability of some common law principles to such claims. Section F discusses cases involving industrial or occupational diseases and poisoning when railroad employees are exposed to toxic substances and whether an employee may recover in a claim for asbestosis damages for a fear of developing cancer. Section G discusses claims under FELA for a railroadâs violation of the Federal Safety Appliance Act. 2664 45 U.S.C. § 51, et seq. (2014). 2665 45 U.S.C. § 53 (2014).
522 Finally, sections H through M discuss articles on causation and FELA, the effect of counterclaims by railroads in FELA cases, recovery under FELA for a fear of developing cancer because of job-related exposure to toxins, and whether FELA should be repealed. B. Liability of Railroads for Negligent Injuries to Employees Statute The United States Code establishes the liability of a railroad common carrier operating in interstate commerce for personal injuries to its employees.2666 Section 51 of FELA provides that a common carrier engaged in interstate commerce is liable for damages when an employee suffers an injury or when the employee dies while engaged in interstate commerce because of a common carrierâs negligence.2667 FELA only covers employees whose duties are in furtherance of interstate or foreign commerce.2668 Common carriers having employees who are engaged in the furtherance of interstate commerce in the District of Columbia or any United States territory 2666 45 U.S.C. § 51 (2014). 2667 Id. Every common carrier by railroad while engaging in commerce between any of the several States or Territories, or between any of the States and Territories, or between the District of Columbia and any of the States or Territories, or between the District of Columbia or any of the States or Territories and any foreign nation or nations, shall be liable in damages to any person suffering injury while he is employed by such carrier in such commerce, or, in case of the death of such employee, to his or her personal representative, for the benefit of the surviving widow or husband and children of such employee; and, if none, then of such employeeâs parents; and, if none, then of the next of kin dependent upon such employee, for such injury or death resulting in whole or in part from the negligence of any of the officers, agents, or employees of such carrier, or by reason of any defect or insufficiency, due to its negligence, in its cars, engines, appliances, machinery, track, roadbed, works, boats, wharves, or other equipment. (emphasis supplied). 2668 45 U.S.C. § 51 (2014).
523 or possession also may be held liable under FELA for an injury to or the death of an employee.2669 An employeeâs contributory negligence will not bar the employee or his or her personal representative or next of kin from recovering damages, but the employeeâs contributory negligence will reduce the amount of damages awarded.2670 Even if an employee is found to have committed negligence that contributed to his or her injury, the employee is not automatically barred from recovering damages.2671 Rather, a jury may reduce damages that otherwise would be recoverable based on the juryâs assessment of the extent of the employeeâs negligence. Furthermore, an employee should not be found to have been contributorily negligent when the employeeâs injury is the result of the employer having failed to adhere to âany statute enacted for the safety of employees [that] contributed to the injury or death of [the] employee.â2672 In the event of a death covered by FELA, an employeeâs survivors may recover damages.2673 An injury must result from negligence on the part of an employer or its agents involving railroad equipment, such as railroad cars, engines, machinery, or tracks.2674 FELA 2669 45 U.S.C. § 52 (2014). 2670 45 U.S.C. § 53 (2014). 2671 Id. 2672 Id. 2673 45 U.S.C. §§ 51 and 59 (2014). 2674 45 U.S.C. § 51 (2014).
524 creates a cause of action under federal law that permits railroad employees to bring claims against their employers for negligence rather than the employees having to rely on state law.2675 A railroad company may not âcontract outâ of its liability2676 or use âassumption of the riskâ as a defense to liability.2677 Finally, a railroad company may not in any way prevent employees from supplying information to persons of interest regarding a FELA claim.2678 Cases 1. Determining Who is an Employee In Kelley v. Southern Pacific Company2679 after Kelley was injured when he fell from a tri-level railroad car he brought an action against his employer Southern Pacific.2680 At the time of his accident, Kelley was employed by the Pacific Motor Trucking Company (PMT), a wholly- owned subsidiary of Southern Pacific.2681 PMTâs contract with Southern Pacific stated that PMT would unload cars from the rail yard, load them onto PMT trucks, and transport them into the city.2682 The Kelley Court explained: 2675 Id. 2676 45 U.S.C. § 55 (2014). 2677 45 U.S.C. § 54 (2014). 2678 45 U.S.C. § 60 (2014). 2679 419 U.S. 318, 95 S. Ct. 472, 42 L. Ed.2d 498 (1974). 2680 Id., 419 U.S. at 319, 95 S. Ct. at 474, 42 L. Ed.2d 498. 2681 Id. 2682 Id., 419 U.S. at 320-321, 95 S. Ct. at 474, 42 L. Ed.2d 498.
525 Under common-law principles, there are basically three methods by which a plaintiff can establish his âemploymentâ with a rail carrier for FELA purposes even while he is nominally employed by another. First, the employee could be serving as the borrowed servant of the railroad at the time of his injury. Second, he could be deemed to be acting for two masters simultaneously. Finally, he could be a subservant of a company that was in turn a servant of the railroad.2683 The Court held that a non-railroad employee must demonstrate that a railroad company has a supervisory responsibility over the non-railroad employee before the employee may be âdeemed pro hac vice [an] employee[] of the railroadâ for the purpose of liability under FELA.2684 2. Requirement of Physical Harm as Antecedent to Claim for Emotional Distress Consolidated Rail Corporation v. Gottshall,2685 decided in 1953 by the United States Supreme Court, was a consolidation of two cases against Consolidated Rail Corporation (Conrail). In one case, Gottshall had witnessed a coworker and good friend suffer and die from a heart attack while repairing defective tracks.2686 As a result of Gottshallâs aforementioned experience and his becoming âextremely agitated and distraught,â Gottshall was diagnosed as suffering from severe depression and post-traumatic stress disorder.2687 In the other case, Carlisle was a train dispatcher whose duties involved âensuring the safe and timely movement of passengers and cargo.â2688 Because of a reduction in the number of Conrail employees Carlisle 2683 Id., 419 U.S. at 324, 95 S. Ct. at 476, 42, L. Ed.2d 498. 2684 Id., 419 U.S. at 330, 95 S. Ct. at 479, 42 L. Ed.2d 498. 2685 512 U.S. 532, 114 S. Ct. 2396, 129 L.Ed.2d 427 (1994). 2686 Id., 512 U.S. at 535-537, 114 S. Ct. at 2400-2401, 129 L.Ed.2d 427. 2687 Id., 512 U.S. at 536-537, 114 S. Ct. at 2401, 129 L.Ed.2d 427. 2688 Id., 512 U.S. at 539, 114 S. Ct. at 2402, 129 L.Ed.2d 427.
526 suffered a nervous breakdown after being assigned additional responsibilities and being forced to work extended hours. Both Gottshall and Carlisle asserted claims of negligent infliction of emotional distress, but neither employee had been physically injured while on the job.2689 Although FELA is to be construed liberally in furtherance of Congressâs remedial purpose to shift liability to an employer, the Court held that FELA is not a workerâs compensation statute.2690 That is, âFELA does not make the employer the insurer of the safety of his employees while they are on duty. The basis of [an employerâs] liability is his negligence, not the fact that injuries occur.â2691 Although negligent infliction of emotional distress is cognizable under FELA,2692 the zone of danger test that applies to claims of negligent infliction of emotional distress under FELA requires an employee to have experienced a physical harm as an antecedent to a claim for emotional distress that is associated with a physical injury.2693 3. Inapplicability of FELA to a Claim for Wrongful Discharge In Lewy v. Southern Pacific Transportation Company2694 Lewy was injured in a railroad collision that resulted in hospitalization; pain in his neck, back, head, and right leg; and, eventually, lower-back surgery.2695 Because Lewyâs employer Southern Pacific believed that 2689 Id., 512 U.S. at 537, 114 S. Ct. at 2401, 129 L.Ed.2d 427. 2690 Id., 512 U.S. at 543, 114 S. Ct. at 2404, 129 L.Ed.2d 427. 2691 Id., 512 U.S. at 543, 114 S. Ct. at 2404, 129 L.Ed.2d 427 (citations omitted) (internal quotation marks omitted). 2692 Id., 512 U.S. at 550, 114 S. Ct. at 2407, 129 L.Ed.2d 427. 2693 Id., 512 U.S. at 557, 114 S. Ct. at 2411, 129 L.Ed.2d 427. 2694 799 F.2d 1281 (9th Cir. 1986). 2695 Id. at 1283.
527 Lewy was malingering, the company ordered Lewy to be examined by a company physician.2696 Because Lewy refused to meet with the physician, he was discharged in 1980 but was allowed to return to work for Southern Pacific in September 1982 after receiving his physicianâs approval.2697 Lewy asserted claims for aggravation and wrongful discharge under FELA.2698 The Ninth Circuit explained that the original purpose of FELA was to âenable injured railroad workers to overcome a number of traditional defenses to tort liability that had previously operated to bar their actions, including contributory negligence, contractual waiver of liability, the fellow-servant rule, and assumption of the risk.â2699 The court noted that FELA covers ânegligent acts that expose employees to occupational diseases;â accidents caused by âexternal violent or accidental means;â and âwholly mental injuries.â2700 In spite of its broad coverage, the Ninth Circuit held that FELA only covers work-related or âon the jobâ injuries.2701 FELA does not apply to claims of wrongful discharge, because wrongful discharge is not considered an on the job injury caused by the employerâs negligence.2702 2696 Id. at 1283-1284. 2697 Id. at 1284. 2698 Id. at 1283. 2699 Id. at 1288 (citations omitted). 2700 Id. (citations omitted). 2701 Id. at 1289. 2702 Id.
528 4. Inapplicability of FELA to Purely Intrastate Activities In Felton v. Southeastern Pennsylvania Transportation Authority2703 Felton was employed in the city transit division of the Southeastern Pennsylvania Transportation Authority (SEPTA).2704 The city transit division engaged in purely intrastate transportation.2705 Felton sustained an injury that left him totally disabled under the applicable Pennsylvania statute and was awarded workerâs compensation.2706 Thereafter, Felton filed a FELA claim against SEPTA to recover damages for his work-related injuries.2707 The Third Circuit held that Congress had no intention of extending FELA coverage to employees of urban transportation systems such as subways.2708 Although the interstate division and the city transit division were both under SEPTA, both divisions were operationally distinct and unconnected, thereby making FELA inapplicable to city transit and its purely intrastate activities.2709 2703 952 F.2d 59 (3d Cir. 1991). 2704 Id. at 60. 2705 Id. 2706 Id. at 60-61. 2707 Id. at 61. 2708 Id. at 66. 2709 Id. at 64-66.
529 Cases C. Whether other Federal Laws may Preclude a Claim under FELA 1. FELA, the Federal Railroad Safety Act, and Preclusion of Federal Claims In Cowden v. BNSF Railway Company,2710 after Cowden was injured while working as a locomotive conductor for BNSF, he was unable to return to work for BNSF.2711 Cowdenâs action under FELA in a federal district court alleged that BNSF failed to provide reasonably safe working conditions.2712 The district court granted BNSFâs motion for a summary judgment based on an issue that BNSF did not raise â âwhether compliance with applicable FRSA safety regulations precludes a finding that the railroad has been negligent for the purposes of the FELA.â2713 Nevertheless, the Eighth Circuit considered the issue of whether a railroadâs compliance with federal safety regulations affected the plaintiffâs FELA claim. The FRSA is intended to promote safety in all areas of railroad operations and imposes upon employers a duty to provide a reasonably safe place to work.2714 The FSRA âstates that â[l]aws, regulations, and orders related to railroad safety and laws, regulations and orders related to railroad security shall be nationally uniform to the extent practicable.ââ2715 As the court stated in Cowden, the Supreme Court in CSX Transp., Inc. v. Easterwood2716 âdid not address how the 2710 690 F.3d 884 (8th Cir. 2012). 2711 Id. at 886. 2712 Id. 2713 Id. at 888 (internal quotation marks omitted). 2714 Id. at 890. 2715 Id. (quoting 49 U.S.C. § 20106(a)(1)). 2716 507 U.S. 658, 113 S. Ct. 1732, 123 L. Ed.2d 387 (1993).
530 FRSA interacted with federal negligence claims under the FELA, and the Supreme Court has yet to address the issue. Three other circuits, however, have used Easterwood as a guide in holding that FRSA regulations preclude federal tort claims under the FELA.â2717 Although the district court raised the above issue sua sponte,2718 even if the Eighth Circuit were to presume that the FSRA precluded the claim, the district court in this case failed to consider âwhether an FRSA regulation âsubstantially subsumesâ the negligence claim.â2719 Because the district court failed to make the âsubstantially subsumesâ analysis and because of the insufficiency of the record below, the Eighth Circuit reversed and remanded the district courtâs grant of a summary judgment for BNSF.2720 2. FELA, the Locomotive Inspection Act, and Federal Preclusion In contrast, a California federal district court in Glow v. Union Railroad Co.2721 held that a FELA claim is not precluded when a railroad has complied with the Locomotive Inspection Act (LIA).2722 Neither the LIA nor regulations issued thereunder foreclose an employeeâs FELA claim.2723 2717 Cowden, 690 F.3d at 890 N 6 (citing Nickels v. Grand Trunk Western R.R., Inc., 560 F.3d 426, 430 (6th Cir. 2009)); Lane v. R.A. Sims, Jr., Inc., 241 F.3d 439, 443 (5th Cir. 2001); Waymire v. Norfolk & W. Ry. Co., 218 F.3d 773, 776 (7th Cir. 2000)). 2718 Id. at 893. 2719 Id. 2720 Id. at 895. 2721 652 F. Supp.2d 1135 (E.D. Cal. 2009). 2722 Id. at 1141. 2723 Id.
531 Cases D. Principles that Generally Apply in FELA Cases 1. Determining whether Employees are engaged in Interstate Commerce under FELA In Geraty v. Northeast Illinois Regional Commuter Railroad Corporation2724 Geraty, a patrol officer for the Northeast Illinois Regional Commuter Railroad Corporation (Metra), filed a FELA claim against Metra for a slip-and-fall injury that Geraty sustained on railroad property when she was working.2725 Under FELA âcoverage extends to an employee of a railroad carrier (i) if any part of the employeeâs duties âshall be the furtherance of interstate or foreign commerce,â or (ii) if any part of the employeeâs duties âin any way directly or closely and substantially, affect[s] such commerce.ââ2726 An Illinois federal district court pointed out that an employeeâs duties do not have to include the actual operation of the railroad and that there does not have to be an actual crossing of state lines multiple times to qualify for being âengaged in interstate commerce.â2727 The employeeâs duties included âassisting patrons, making arrests, and patrolling a span of tracks that Metra made available to certain interstate trains,â as well as âprevent[ing] and deter[ring] vandalism on the tracks ⦠and respond[ing] and investigat[ing] grade crossing collisions or anything else on the rails that might delay the trains.â2728 The court 2724 2009 U.S. Dist. LEXIS 20573, at *1 (N.D. Ill. 2009). 2725 Id. at *2-8 (N.D. Ill. 2009), summary judgment denied, 2010 U.S. Dist. LEXIS 29578 (N.D. Ill., Mar. 29, 2010). 2726 Id. at *12 (quoting 45 U.S.C. § 51). 2727 Id. at *13, *20. 2728 Id. at *20, 21.
532 held that Geratyâs duties were in furtherance of interstate commerce and therefore denied Metraâs motion for a summary judgment.2729 2. Permissibility of Counterclaims by Railroads in FELA Claims In Cavanaugh v. Western Maryland Railway Co.2730 the Fourth Circuit ruled that if railroads were unable to assert a counterclaim for an employeeâs negligence railroads would be incapable of recovering damages to their property while the plaintiff received absolute immunity from liability in spite of his negligent behavior.2731 Because Congress wrote the statute to preclude assumption of the risk and âsubstantially modified the defense of contributory negligence,â the Fourth Circuit held that congressional failure to preclude railroads explicitly from asserting counterclaims indicates that counterclaims are allowable.2732 3. Whether a Plaintiff must prove Proximate Cause in a FELA Action In CSX Transportation v. McBride,2733 decided by the United States Supreme Court, McBride alleged that CSX was negligent because the company required him to use unsafe equipment and failed to train him on how to operate the equipment. The Supreme Court considered whether it was necessary under FELA for McBride to prove that CSXâs alleged negligence was the proximate cause of McBrideâs injuries. Although CSX argued that McBride 2729 Id. 2730 729 F.2d 289 (4th Cir. 1984). 2731 Id. at 291. 2732 Id. See also, Withhart v. Otto Candies, L.L.C., 431 F.3d 840 (5th Cir. 2005) (holding that the FELA did not preclude employer ship owner from recovering for property damage from a negligent employee); Nordgren v. Burlington N. R.R. Co., 101 F.3d 1246 (8th Cir. 1996) (holding that FELA did not preclude a railroad from recovering against an employee for property damage). 2733 131 S. Ct. 2630, 180 L.Ed.2d 637 (2011).
533 had to prove proximate cause, the Court held that juries should be instructed to find liability whenever a ârailroadâs negligence played any part in bringing about the injury.â2734 According to the Court, its decision was based on the intent of Congress when enacting FELA. The Court explained that liability under FELA is limited to railroads and to their employees only for injuries sustained in the course of employment and that an injury must have resulted âin whole or in part from the negligenceâ of the carrier.2735 CSXâs position was that causation under FELA requires a direct relationship between an asserted injury and allegedly injurious conduct or negligence.2736 However, the Court held that the language in and purpose of FELA demonstrates that the statute does not incorporate proximate cause as traditionally exists in tort actions.2737 Thus, because it was not error to refuse to use âproximate cause terminologyâ in FELA actions, the court affirmed the Seventh Circuitâs decision.2738 4. Low Standard for Evidence Required in FELA Cases In Rivera v. Union Pac. R.R. Co.,2739 based on the Supreme Courtâs ruling in McBride, the Fifth Circuit held that there is a very low standard for the evidence that a plaintiff needs to prove a FELA claim. In a FELA suit, the court must deny a defendantâs motion for judgment as a matter of law for lack of evidentiary support âunless there is a complete absence of probative 2734 Id., 131 S. Ct. at 2634, 180 L. Ed.2d at 643. 2735 Id., 131 S. Ct. at 2636, 180 L. Ed.2d at 645. 2736 Id., 131 S. Ct. at 2642, 180 L. E.2d at 651. 2737 Id., 131 S. Ct. at 2642-2643, 180 L. Ed.2d at 652. 2738 Id., 131 S. Ct. at 2644, 180 L. Ed.2d at 653. 2739 378 F.3d 502 (5th Cir. 2004).
534 facts to support the conclusion reached by the jury.â2740 5. The Use of Comparative Negligence rather than Contributory Negligence in FELA Cases Some states follow a contributory negligence rule whereby any negligence on the part of a plaintiff is a complete bar to recovery; however, the doctrines of contributory negligence and assumption of the risk do not apply to cases brought under FELA.2741 Section 53 of FELA effectively provides that the principles of comparative negligence apply when it is alleged that a plaintiff was contributorily negligent.2742 In contrast to a contributory negligence rule, in a FELA case an employeeâs negligence will not bar a recovery completely. If an employeeâs negligence contributed to his or her injury, the employeeâs damages will be reduced to the extent of the negligence that is attributable to the employee. In Norfolk Southern Railway v. Sorrell2743 the Supreme Court held that the same causation standards should be used for the negligence of a railroad and any contributory negligence of the employee to calculate any reduction in damages that otherwise would be owed to the employee.2744 In Sorrell, to determine whether the same causation standard should be used, the Court considered how the common law dealt with the issue. The Court decided to 2740 Id. at 505 (citing Lavender v. Kurn, 327 U.S. 645 (1946); Wooden v. Missouri Pac. R.R. Co., 862 F.2d 560 (5th Cir. 1994)). 2741 See Toledo, St. L. & W. R. Co. v. Slavin, 236 U.S. 454, 35 S. Ct. 306, 59 L. Ed. 671 (1915); Central V. R. Co. v. White, 238 U.S. 507, 35 S. Ct. 865, 59 L. Ed. 1433 (1915). 2742 45 U.S.C § 53 (2014). 2743 549 U.S. 158, 127 S. Ct. 799, 166 L. Ed.2d 638 (2007). 2744 Id., 549 U.S. at 160, 127 S. Ct. at 802, 166 L. Ed.2d at 644.
535 follow the common law because ââ[a]bsent express [statutory] language to the contrary, the elements of a FELA claim are determined by reference to the common law [of negligence].â2745 6. FELAâs Preemption of Actions under State Law Many years ago in New York Central Rail Company v. Winfield,2746 involving Winfieldâs loss of an eye because of a flying pebble, the Supreme Court held that FELA precluded an employee from claiming damages under state law.2747 The Court held that Winfield could not seek damages under the stateâs Workmenâs Compensation Law because FELA was too comprehensive to allow additional options for recovery.2748 7. Whether Transit Authority Employee Assigned to Work on the Long Island Railroad was Employee of an Entity Operating as a Common Carrier in Interstate Commerce In Greene v. Long Island Railroad Company2749 a police officer employed by the New York Metropolitan Transit Authority (MTA) brought an action under FELA for an injury he suffered while patrolling the Long Island Railroad (LIRR).2750 In 1997, after the MTA was 2745 Id., 549 U.S. at 165-166, 127 S. Ct. at 805, 166 L. Ed.2d at 647. 2746 244 U.S. 147, 37 S. Ct. 546, 61 L. Ed. 1945 (1917). 2747 Id., 244 U.S. at 153-154, 37 S. Ct. at 549, 61 L. Ed. at 1049. 2748 Id., 244 U.S. at 148, 37 S. Ct. at 548, 61 L. Ed. at 1048-1049. 2749 99 F. Supp.2d 268 (E.D.N.Y. 2000), affâd, 280 F.3d 224 (2d Cir. 2002). See Jeffrey J. Amato, Comment, âThe MTA, Itâs Not âGoing Your Wayâ â Liability of the Metropolitan Transportation Authority under FELA: Greene v. Long Island R.R.,â 75 St. Johnâs L. Rev. 113, 135-136 (2001) in which the author argues: The unwarranted extension of FELA liability to the MTA perpetuated an unsound theory of employer liability and evinced an inaccurate judicial perception of the actual functions of the MTA. The MTA functions as a coordinator, managing an integrated public transportation system, which incidentally includes two railroads subject to the FELA. The MTA, itself, does not operate as a common carrier under the meaning of the statute and therefore should not be held liable under the FELA.
536 empowered to maintain a police force, the LIRR ceased having its own police force. Many LIRR police officers, as did the plaintiff, became employed by the MTA.2751 The MTA claimed that it was ânot a proper defendant under FELAâ because the MTA was ânot a common carrier within the meaning of the statute.â2752 The LIRR argued that although it is a common carrier the LIRR was not liable because Greene was no longer its employee at the time of the accident.2753 A federal district court in New York denied the defendantsâ motion for summary judgment. The court noted that the Supreme Court of the United States has defined a common carrier as ââone who operates a railroad as a means of carrying for the publicâ¦.ââ2754 Based on the MTAâs purpose, structure, and functions, the court determined that the MTA was a common carrier but that only âthose employees of MTA who are engaged in the interstate common carrier operations of its commuter railsâ are covered by FELA.2755 The court held that although âit is certainly true that the LIRR operates a common carrier, it is also true that MTAâs extensive involvement in this entity leads to the conclusion that it, too, operates this common carrier.â2756 Thus, MTA employees such as the plaintiff who are âassigned to work on the LIRR[] are employed by an entity operating a common carrier engaged in interstate commerce. Plaintiff is 2750 Greene, 99 F. Supp.2d at 270. 2751 Id. at 270. 2752 Id. at 271. 2753 Id. 2754 Id. (citation omitted). 2755 Id. at 275. 2756 Id. at 274.
537 no less employed by a common carrier today than when he performed the same duties when employed by the LIRR.â2757 MTA employees engaged only in intrastate rail operations are covered by workersâ compensation law, not FELA.2758 As the court cautioned, the courtâs holding is limited to those employees of MTA who are engaged in the interstate common carrier operations of its commuter rails. Specifically, the holding that MTA operates a common carrier does not lead to the conclusion that all MTA employees, including those employed strictly in the MTAâs intrastate operations (such as employees of the New York City Transit Authority), are to be covered by FELA.2759 In dicta, the court stated that âFELAâs liability standard regarding railroad workers injured on the job is one that has become outmodedâ and that railroad workers should be covered by workersâ compensation the same as other employees.2760 8. The Effect of Medical Insurance on the Amount of an Employeeâs Recoverable Damages In Leighton v. CSX Transportation2761 a court considered the collateral source rule in deciding whether an employeeâs recovery of medical expenses should be only the amount of the employeeâs out-of-pocket expenses.2762 The Railroad Employees National Health and Welfare 2757 Id. 2758 Id. at 272-275. 2759 Id. at 274-275 (emphasis supplied). 2760 Id. at 270. 2761 338 S.W.3d 818 (Ky. Ct. App. 2011). 2762 Id. at 819.
538 Plan paid the majority of Leightonâs medical expenses on behalf of CSX.2763 The Kentucky Court of Appeals relied on decisions of other courts that had ruled that payments by an insurance plan on behalf of a railroad were not a collateral source.2764 The court held that because the payments by the health insurance plan were not a collateral source, the employeeâs recovery must be limited to out-of-pocket expenses.2765 Cases E. Whether a Claim of Infliction of Emotional Distress may be made under FELA 1. Whether the Zone of Danger Test Applies to a Claim under FELA for Intentional Infliction of Emotional Distress In Goodrich v. Long Island Rail Road Co.,2766 involving a claim of intentional infliction of emotional distress under FELA against the Long Island Rail Road Co. (LIRR), Goodrich argued that while he was out sick the defendants took his sick leave form and added ââ[a]nd HIV positiveâ beneath the doctorâs flu diagnosis and posted it on a public bulletin board at the LIRRâs facility.â2767 Goodrich alleged that because the defendants were at work and were in the LIRR facility when they posted the sick leave form they were acting within the scope of their employment.2768 2763 Id. at 820. 2764 Id. at 821. 2765 Id. at 822. 2766 654 F.3d 190 (2d Cir. 2011). 2767 Id. at 192. 2768 Id.
539 The Second Circuit considered whether the zone of danger test applied to such claims for emotional distress under FELA. LIRR argued that the company could not be held liable for negligent or intentional infliction of emotional distress unless a plaintiff satisfies the zone of danger test. The test requires that a plaintiff must have âsustained a physical impact or been placed in immediate risk of physical harm by the conduct of the LIRR or its agents.â2769 Although the text of FELA only refers to negligence that causes an injury or death, the Supreme Court has held that FELA is a âbroad remedial statuteâ that has been long understood to apply to intentional torts, such as battery, in addition to negligence claims.2770 The Second Circuit had decided in an earlier case that claims of intentional infliction of emotional distress may be brought under FELA but did not address the zone of danger test.2771 In Goodrich, the court cited precedents from other circuits in stating that FELA has not applied in cases of intentional infliction of emotional distress when there has been no physical harm to the employee.2772 The âcore concern of FELA ⦠[is] that employees must suffer some kind of physical harm, impact, or invasion before they may recover under the Act.â2773 The court held that the zone of danger test applies to intentional infliction of emotional distress claims under 2769 Id. 2770 Id. at 193. 2771 Id. at 199. 2772 Id. at 196 (stating that â[i]ndeed, our understanding of FELA is shared by all our sister Circuits that have expressly considered the extent to which claims based on emotional distress may be brought under the Actâ and citing Adkins v. Seaboard Sys. R.R., 821 F.2d 340, 341-42 (6th Cir. 1987) (per curiam) (holding that âFELA has not been applied to any intentional torts lacking any physical dimension such as assaultâ) and Rivera v. Natâl R.R. Passenger Corp., 331 F.3d 1074, 1082 (9th Cir. 2003) (stating that FELA compensates for an âinjury caused by a physical phenomenonâ). 2773 Id. (citing Higgins v. Metro-North R.R. Co., 318 F.3d 422 (2d Cir.2003)).
540 FELA. However, the court held that Goodrich did not have a claim under FELA because Goodrich failed to allege that because of LIRRâs actions he had sustained a âphysical impactâ or was placed in âimmediate risk of physical harm.â2774 2. Whether the Zone of Danger Test Applies to a Claim under FELA for Negligent Infliction of Emotional Distress Similar to Sorrell, in Conrail v. Gottshall2775 the Supreme Court also applied the common law in FELA claims asserted on the basis of negligent infliction of emotional distress.2776 The Court held that a claim for negligent infliction of emotional distress was actionable under FELA because of FELAâs broad definition of injury; however, the Court embraced the zone of danger test under the common law that is in harmony with FELAâs focus on physical injuries.2777 Cases F. Claims under FELA for Industrial or Occupational Diseases and Poisoning 1. Recovery of Damages for a Fear of Developing Cancer CSX Transportation v. Hensley,2778 decided by the Supreme Court, appears to be the leading case on suits by employees against railroads under FELA for exposure to asbestos. Hensley brought an action under FELA against CSX to recover damages for asbestosis and pain and suffering including damages for his fear of developing lung cancer.2779 Citing its prior 2774 Id. 2775 512 U.S. 532, 114 S. Ct. 2396, 129 L. Ed.2d 427 (1994). 2776 Id., 512 U.S. at 535, 114 S. Ct. at 2400, 129 L. Ed.2d at 435. 2777 Id., 512 U.S. at 569-570, 114 S. Ct. at 2417, 129 L. Ed.2d at 456. 2778 556 U.S. 838, 129 S. Ct. 2139, 173 L.Ed.2d 1184 (2009). 2779 Id., 556 U.S. at 839, 129 S. Ct. at 2140, 173 L. Ed.2d at 1186-1187.
541 decision in Norfolk & Western Ry. v. Ayers,2780 the Supreme Court held that an employee may be able to recover under FELA for emotional distress for fear of developing cancer without exhibiting physical manifestations as long as the individual is only seeking damages for asbestosis-related pain and suffering and the plaintiffâs fear of developing cancer is âgenuine and serious.â2781 The Court held that â[a]lthough plaintiffs can seek fear-of-cancer damages in some FELA cases, they must satisfy a high standard in order to obtain them.â2782 Therefore, jury instructions must state the proper standard that is applicable to a claim for damages for a plaintiffâs fear of developing cancer.2783 2. Liability of a Railroad under FELA for an Employeeâs Exposure to a Toxic Substance In Norfolk & Western Ry. v. Ayers2784 railroad employees sued Norfolk Southern under FELA because of their exposure to asbestos that led to each employee being diagnosed with asbestosis.2785 The issues for the Supreme Court were (1) whether the employees could recover damages for mental anguish as part of their damages for pain and suffering because of their fear of developing cancer and (2) whether Norfolk Southern was liable for all damages related to the injury that the railroad negligently caused in whole or in part (i.e., whether the railroad was 2780 538 U.S. 135, 123 S. Ct. 1210, 155 L.Ed.2d 261 (2003). 2781 Hensley, 556 U.S. at 841, 129 S. Ct. at 2141, 173 L. Ed.2d at 1188. 2782 Id., 556 U.S. at 841-842, 129 S. Ct. at 2141, 173 L. Ed.2d at 1188. 2783 Id., 556 U.S. at 843, 129 S. Ct. at 2141, 173 L. Ed.2d at 1188. 2784 538 U.S. 135, 123 S. Ct. 1210, 155 L. Ed.2d 261 (2003). 2785 Id., 538 U.S. at 141-142, 123 S. Ct. at 1215, 155 L. Ed.2d at 271-272.
542 responsible for the entire amount even if another party also negligently caused the injury).2786 On the first issue, the Court held that employees could recover for mental anguish when they are able to prove that their fear is a genuine and serious one.2787 On the second issue, the Court held that a railroad is responsible for the entire amount of compensation that is awarded in spite of the possibility that another partyâs negligence may have caused the injury as well.2788 3. Liability of a Railroad for Industrial or Occupational Disease or Poisoning In Fraynert v. Delaware and Hudson Railway Co.2789 a Court of Common Pleas in Pennsylvania ruled on whether the three year statute of limitations under FELA barred the claims of six former employees who alleged that the Delaware and Hudson Railway Co. (Delaware & Hudson) negligently exposed them to coal dust that caused their pulmonary injuries.2790 As the court explained, â[t]o obtain summary judgment, the railroad must establish that the plaintiffs knew, or in the exercise of reasonable diligence should have known, of their pulmonary damage and its cause more than three years prior to filing these FELA actions.â2791 At that stage of the proceedings the court denied Delaware & Hudsonâs motion for a summary judgment regarding five plaintiffs because it was not clear whether they âpossessed sufficient critical facts to objectively discover their pulmonary harm and its cause more than 2786 Id., 538 U.S. at 140, 123 S. Ct. at 1214, 155 L. Ed.2d at 271. 2787 Id., 538 U.S. at 141, 123 S. Ct. at 1215, 155 L. Ed.2d at 271. 2788 Id. 2789 2013 Pa. Dist. & Cnty. Dec. LEXIS 299, at *1 (Pa. Ct. Com. Pl. 2013). 2790 Id. at *12 (citing 45 U.S.C. § 56). 2791 Id. at *1.
543 three years before suit was commenced.â2792 However, the court granted the railroadâs motion concerning âone plaintiff [who] knew seven years before he filed his FELA claim that his pulmonary testing revealed serious lung damage, that railroad workers were suffering respiratory and pulmonary problems from lung contamination, and that his coughing and breathing difficulties were attributable to occupational coal dust exposure.â2793 Cases G. Violations of the Federal Safety Appliance Act and Claims under FELA 1. Liability for an Employeeâs Injury Occurring when a Train was in Use In Woodard v. CSX Transportation, Inc.2794 the plaintiff Woodard, a stevedore for CSX, was injured when unloading a railcar. Along with his FELA claim, Woodard filed a claim under the Federal Safety Appliance Act (FSAA)2795 for which a âviolation constitutes negligence per se in a FELA suit.â2796 The issue was whether a railcar was âin useâ at the time of the accident.2797 A federal district court in New York held that because the employee was injured while unloading the railcar when it was on a CSX track the railcar was in use at the time of the injury.2798 The court denied CSXâs motion for a partial summary judgment.2799 2792 Id. 2793 Id. at *1-2. 2794 2012 U.S. Dist. LEXIS 16704, at *1 (N.D. N.Y Feb. 10, 2012). 2795 Id. 2796 Id. at *3. 2797 Id. at *2-4. 2798 Id. at *4. 2799 Id.
544 2. Liability of a Railroad under FELA based on a Violation of the FSAA In Strickland v. Norfolk Southern Ry. Co.,2800 involving claims against Stricklandâs employer Norfolk Southern under the FSAA and FELA, the Eleventh Circuit held that a violation of the FSAA may be asserted under FELA.2801 Although Strickland later could not identify the railroad car that caused his injury, the plaintiff alleged that he sustained a serious shoulder injury because of a faulty handbrake. The court held that a summary judgment in favor of Norfolk Southern because of the workerâs failure to identify the railcar where his injury occurred was inappropriate. To survive a motion for a summary judgment on a FELA claim, a plaintiff only needs to demonstrate âthat a question of fact exists concerning whether the employerâs negligence played a part, however slight, in the employeeâs injuries.â2802 Thus, if there were a question of fact whether a Norfolk Southern railcar caused Stricklandâs injury his action should survive a motion for a summary judgment. Relying on the Supreme Courtâs statement in McBride, supra, that FELA was enacted to counteract harsh rules of state common law the court stated that a âsummary judgment in the instant case would be counter to that forgiving standard.â2803 Moreover, the court held that there was a genuine issue of material fact because of a conflict between the plaintiffâs deposition and his affidavit. A summary judgment is improper when âa fact-finder is required to weigh a deponentâs credibilityâ¦.â2804 The court reversed and remanded the district courtâs order granting a 2800 692 F.3d 1151 (11th Cir. 2012). 2801 Id. at 1151-1153. 2802 Id. at 1157. 2803 Id. at 1160.
545 summary judgment to Norfolk Southern.2805 Articles H. What a Plaintiff must Prove Regarding Causation under FELA A recent law review article analyses the Supreme Courtâs decision in 1957 in Rogers v. Missouri Pacific Railroad Co.2806 in which the Court held that FELA requires only âthat employer negligence played any part, even the slightest, in producing the injury.â2807 The article begins by explaining that when Congress enacted FELA the âstandards were quite different from those discussedâ in the article.2808 The article argues that the statement that âFELA adopted âa relaxed standard of causationâ makes no sense in relation to factual cause because factual cause is not a matter of degree. It might make sense if applied to scope of liability because it encompasses a range of foreseeability.â2809 The author analyzes the Rogers case in an effort to show that it is flawed in numerous respects.2810 The article speculates that one of the reasons for the expansive holding in Rogers was the tendency at the time for trial judges to take FELA cases from juries on the 2804 Id. at 1162. 2805 Id. 2806 352 U.S. 500, 77 S. Ct. 443, 1 L. Ed.2d 493 (1957). 2807 Michael D. Green, âThe Federal Employersâ Liability Act: Sense and Nonsense about Causation,â 61 DePaul L. Rev. 503, 504 (2012). 2808 Id. at 508. 2809 Id. at 518 (footnote omitted). 2810 Id. at 523.
546 ground of the insufficiency of the plaintiffâs evidence.2811 The article attempts to explain the Rogers case on the basis that the decision was about âfactual causation.â2812 The author argues that post-Rogers the courts endorse[d] the Rogers language for use in jury instructions and duck[ed] out of the way. The effect of this is to leave the jury without any meaningful standard for deciding causation and to fail to inform the jury that, before the defendant can be held liable, the jury must find that the plaintiffâs harm would not have occurred if the defendant had acted nonnegligently.2813 Two other possible explanations of the Rogers case are based on the theory of the burden of production or legal sufficiency of the evidence2814 or the scope of liability of FELA, the latter being a âdifficult interpretative puzzleâ to decipher.2815 However, the article states that post- Rogers â[a] number of courts ⦠interpreted Rogers as having adopted a less rigorous, or even eliminating any, scope of liability limitation from the statute.â2816 Even so, the author does not believe that there is any risk of âvirtually limitless liabilityâ of railroads in part because claims may be brought only by railroad employees.2817 Finally, the author suggests that the Court in CSX Transportation v. McBride, supra, could have cleared away much of the confusion caused by the Rogers case if only the Court had âinsisted that factual causation be distinguished from scope of liabilityâ¦.;â âmade plain that the 2811 Id. 2812 Id. at 528-529. 2813 Id. at 531 (footnote omitted). 2814 Id. at 531-532. 2815 Id. at 532-534. 2816 Id. at 532. 2817 Id. at 534.
547 plaintiff has the burden of proof to establish that the defendantâs negligence was a necessary condition/but for/without which/sine qua non (take your pick) of the plaintiffâs harm;â decide[d] whether, within ⦠FELAâs statutory language, there is room for some scope of liability limitation on a defendantâs liability;â and âconfronted and resolved the effect of the âin whole or in partâ language on the burden of production with regard to factual cause.â2818 I. The Extent of Causation Required in FELA Claims after McBride In âCausation Issues in FELA and Jones Act Cases in the Wake of McBrideâ the author explores the uncertainty of the McBride decision.2819 The article traces the origins of the McBride decision to the 1957 Supreme Court decision in Rogers v. Missouri Pacific Railroad Co. that first relaxed the standard of causation under FELA.2820 After years of confusion and controversy among the circuits because of the Rogers decision, the McBride decision offered some clarity but left unclear what exactly the standard of causation should be for FELA claims.2821 The author argues that the Supreme Courtâs decision means that âFELA lacks a formal ⦠[proximate cause] requirement, but courts can find a way within the Rogers language to rule as a matter of law for defendants in cases of extremely and inappropriately remote causation.â2822 Although the holding in McBride was a major win for plaintiffs filing claims under FELA, the author argues that the Supreme Court did not go so far as to remove completely 2818 Id. at 538-539. 2819 David W. Robertson, âCausation Issues in FELA and Jones Act Cases in the Wake of McBride,â 36 Tul. Mar. L. J. 397 (2012). 2820 Id. at 399. 2821 Id. at 400. 2822 Id. at 411, 417-418.
548 the element of proximate cause.2823 The author submits that the decision âwill not work out to be as great as it looks on paper,â because the courts commonly use reasoning that is based on proximate cause, even when declaring there is no proximate cause requirement.2824 J. The Effect of Counterclaims by Railroads on FELA Claims In âSidetracking the FELA: The Railroadsâ Property Damage Claimsâ the author argues that FELAâs value is compromised by the increased instances in employeesâ suits under FELA when railroads counterclaim for property damage.2825 The author argues that the potential for counterclaims by railroads deters employees and their families from filing claims under FELA.2826 K. When an Employee may Recover under FELA for a Fear of Developing Cancer An article in Trial analyzes the application of FELA in cases when there are substances in the workplace that cause non-malignant harm but that may cause cancer in the long term.2827 Although railroads have resisted claims by employees based on their fear of developing cancer from job-related exposure to toxins, the Supreme Court has begun to clarify the issue.2828 In Norfolk & Western v. Ayers, supra, part XXI.F.2, the Court considered whether a plaintiff in a 2823 Id. at 421. 2824 Id. ) (citing Heath v. Matson Navigation Co., 333 F. Supp. 131, 135-36, 1972 AMC 1063, 1068-70 (D. Haw. 1971)). 2825 William P. Murphy, âSidetracking the FELA: The Railroadsâ Property Damage Claims,â 69 Minn. L. Rev. 349, 350 (1985). 2826 Id. at 386-87. 2827 William P. Gavin, âFELA and the Fear of Cancer,â Trial (Jan. 2011). 2828 Id. at 44.
549 FELA case who was diagnosed with asbestosis but not with cancer could recover damages based on a fear of developing cancer even without symptoms of emotional distress. The Court held that such a claim is actionable as long as the one suffering from asbestosis seeks damages for fear of developing cancer as an element of the damages for asbestosis-related pain and suffering.2829 After the decision in Ayers, other courts held that even a plaintiff who is not exhibiting any sign of physical symptoms stemming from emotional distress may bring a claim for emotional distress that is related to asbestosis and the fear of having cancer eventually.2830 The article discusses how CSX Transportation v. Hensley, supra, part XXI.F.1, altered the Ayers precedent. In Ayers the Court had held that damages for pain and suffering may include damages for the fear of developing cancer that accompanies physical injury, whereas the Court in Hensley ruled that it was reversible error to fail to give a limiting instruction on the recovery of damages for fear-of-cancer, thus setting a higher bar for receiving an award for a fear of developing cancer because of asbestosis.2831 The Court did not explain what the standard should be or include. Besides discussing relevant case law, the article includes suggestions on how to harmonize the cases and the guidelines that they establish in permitting awards that include damages for fear-of-cancer. L. Whether the Cost of FELA Claims is too High In âThe Federal Employersâ Liability Act: A Compensation System in Urgent Need of Reform,â the authors argue that over the last century the Supreme Court has sought to diminish a 2829 Id. 2830 Id. at 47-48. 2831 Id. at 47.
550 plaintiffâs burden of proof for claims under FELA.2832 The authors note that in eighty-four percent of FELA cases in which the Supreme Court has granted certiorari âthe Court reversed the lower court for setting aside a jury verdict for the employee or taking the case from the jury.â2833 The authors argue that the costs of FELA claims are very high, not only because damages may include lost wages, medical expenses, estimated future earnings, and pain and suffering, but also because the low requirement for proof of negligence all but ensures that counsel will be involved, thus increasing the transaction costs of FELA claims.2834 M. Whether FELA should be Repealed In âWhy Congress Should Repeal the Federal Employersâ Liability Act of 1908â the author argues that FELA should be repealed or clarified.2835 The author argues that FELA is outdated, overburdens the federal courts, and should be replaced by state workersâ compensation funds.2836 2832 Arnold I. Havens and Anthony A. Anderson, âThe Federal Employersâ Liability Act: A Compensation System in Urgent Need of Reform,â 34 Fed. B. News & J. 310 (1987). 2833 Id. at 312. 2834 Id. at 313. 2835 Thomas E. Baker, âWhy Congress Should Repeal the Federal Employersâ Liability Act of 1908,â 29 Harv. J. on Legis. 79 (1992). 2836 Id. at 87, 92.
551 XXII. FEDERAL FINANCING FOR RAILROAD PROJECTS A. Introduction Congress has authorized billions of dollars to support the expansion and upgrading of transportation systems across the country.2837 Section B discusses the Moving Ahead for Progress in the 21st Century Act (MAP-21), discussed in more detail in part XXII of the Report, which Congress enacted in 2012. Section C addresses the Transportation Infrastructure Finance and Innovation Act (TIFIA). Section D covers the Railroad Rehabilitation and Improvement Financing Act (RRIF). Section E discusses funding for the Railway-Highway Crossings Program. Finally, Section F discusses the 2009 American Recovery and Reinvestment Act (AARA). Statutes B. Moving Ahead for Progress in the 21st Century Act â MAP-21 1. Programs Affected by MAP-21 Under MAP-21 Congress authorized $105 billion for fiscal year 2013-2014. MAP-21 includes many programs, examples of which are the National Highway Performance Program (§ 1106);2838 the Surface Transportation Program (§ 1108);2839 the Highway Safety and Improvement Program (§ 1112);2840 the Congestion Mitigation and Air Quality Improvement 2837 United States Department of Transportation, Federal Highway Administration, âMAP-21 Moving Ahead for Progress in the 21st Century,â available at: https://www.fhwa.dot.gov/map21/ (last accessed March 31, 2015), hereinafter referred to as âMAP-21 Moving Ahead for Progress.â 2838 MAP-21, P.L. 112-141 § 1104. 2839 Id. § 1108. 2840 Id. § 1112.
552 Program (§ 1113);2841 and the Transportation Alternatives Program (§ 1122).2842 According to the Federal Highway Administration (FHWA), MAP-21 âcreates a streamlined and performance- based surface transportation program and builds on many of the highway, transit, bike, and pedestrian programs and policies established in 1991.â2843 2. Funding for Surface Transportation Programs In 2012, MAP-21 authorized funding for several surface transportation programs and the utilization of a performance-based evaluation system for the programs.2844 MAP-21 seeks to expand numerous projects already in progress within the various highway programs.2845 MAP- 21 also includes funding for TIFIA and for the upgrading of railway-highway crossings, both of which are discussed below.2846 Statutes and Regulations C. Transportation Infrastructure Finance and Innovation Act 1. Funding The Transportation Infrastructure Finance and Innovation Act or TIFIA, enacted in 1998 and modified by MAP-21, âmakes three forms of credit assistance available â secured (direct) loans, loan guarantees and standby lines of credit â for surface transportation projects of national 2841 Id. § 1113. 2842 Id. § 1122. 2843 MAP-21 Moving Ahead for Progress, supra note 2837. 2844 Id. 2845 Id. 2846 MAP-21 § 2002 (2012), 23 U.S.C. §§ 601-609 (2014); MAP-21 § 1519, 23 U.S.C. § 130 (2014).
553 or regional significance.â2847 TIFIA provides federal credit assistance for eligible surface transportation projects and is designed to allow state and local governments to finance large- scale projects.2848 Loans are available for surface transportation projects such as highway, railroad, intermodal freight, and transit projects; moreover, port-access projects may apply for financial assistance that may be combined with private funding.2849 The source of TIFIA funding is the Highway Trust Fund.2850 A project eligible for TIFIA may secure a line of credit, a loan, or both. A TIFIA line of credit may be secured for an amount up to 33% of the cost of a project, whereas a TIFIA loan may be made for up to 49% of a projectâs cost.2851 2. Project Eligibility Rail projects that are eligible for a TIFIA line of credit or loan include intercity passenger rail facilities (as well as Amtrak); public and private freight rail projects, although the latter must provide a âpublic benefit for highway users;â intermodal freight transfer facilities; and projects that improve the service of freight rails.2852 Eligible projects include urban infrastructure 2847 United States Department of Transportation, FHWA, âTransportation Infrastructure Finance and Innovation Act,â available at: https://www.fhwa.dot.gov/map21/factsheets/tifia.cfm (last accessed March 31, 2015); available at: https://www.fhwa.dot.gov/map21/factsheets/tifia.cfm; http://www.fra.dot.gov/Page/P0340 (last accessed March 31, 2015), hereinafter referred to as âTIFIA.â 2848 MAP-21 § 2002 (2012), 23 U.S.C. §§ 601-609 (2014) (setting forth the definitions of eligibility for infrastructure finance projects); United States Department of Transportation, FHWA, âIntroduction to TIFIA FAQ,â available at: http://www.fhwa.dot.gov/ipd/tifia/faqs/ (last accessed March 31, 2014. 2849 TIFIA, supra note 2847; MAP-21 § 2002, 23 U.S.C. §§ 601-609 (2014). 2850 Id. 2851 Id. 2852 Id.
554 projects costing more than $50 million; rural infrastructure projects costing at least $25 million; an âintelligent transportation systemâ costing at least $15 million; or a project that costs up to one-third of a stateâs formula apportionment in a given year.2853 D. Railroad Rehabilitation and Improvement Financing Program Statutes and Regulations 1. Direct Loans and Loan Guarantees As a result of the Transportation Equity Act for the 21st Century (TEA-21), RRIF authorized up to $35 billion in direct loans and loan guarantees for railroad infrastructure projects. The statutory and regulatory authority for direct loans and loan guarantees under the RRIF program are 45 U.S.C. §§ 821, et seq. and 49 C.F.R. § 260, et seq. Section 821 of the statute defines important terms, such as the calculation of the estimated long-term cost to the government of a direct loan or loan guarantee; § 822 sets forth the specific provisions that apply to direct loans and guarantees; and § 823 deals with administration. Under § 822(a) of the statute the Secretary of Transportation is authorized to provide direct loans and loan guarantees to: (1) State and local governments; (2) interstate compacts consented to by Congress under section 410(a) of the Amtrak Reform and Accountability Act of 1997 (49 U.S.C. 24101 note); (3) government sponsored authorities and corporations; (4) railroads; (5) joint ventures that include at least one railroad; and (6) solely for the purpose of constructing a rail connection between a plant or facility and a second rail carrier, limited option rail freight shippers that own or operate a plant or other facility that is served by no more than a single railroad.2854 2853 Id. 2854 45 U.S.C. § 822(a) (2014); 49 C.F.R. § 260.1 (2014).
555 The foregoing authority has been delegated to the Administrator of the Federal Railroad Administration.2855 When applications are being evaluated, priority is given to projects, for example, that will enhance public safety or the environment, promote economic development, preserve or enhance rail or intermodal service to small communities or rural areas, or enhance service and capacity in the national rail system.2856 The statute and regulations establish certain limitations, conditions prerequisites, and requirements. For example, under § 822(d) of the statute one limitation is that [t]he aggregate unpaid principal amounts of obligations under direct loans and loan guarantees made under this section shall not exceed $35,000,000,000 at any one time. Of this amount, not less than $7,000,000,000 shall be available solely for projects primarily benefiting freight railroads other than Class I carriers.2857 There are several conditions for assistance, one of which is that a railroad or railroad partner will not use any funds or assets from railroad or intermodal operations for purposes not related to such operations, if such use would impair the ability of the applicant, railroad, or railroad partner to provide rail or intermodal services in an efficient and economic manner, or would adversely affect the ability of the applicant, railroad, or railroad partner to perform any obligation entered into by the applicant under this sectionâ¦.2858 Two of the five prerequisites for assistance are that the ârepayment of the obligation is required to be made within a term of not more than 35 years from the date of its executionâ and 2855 49 C.F.R. § 260.1 (2014). 2856 45 U.S.C. § 822(c)(1), (2), (6) and (7) (2014). See also, 49 C.F.R. § 260.7 (2014). 2857 45 U.S.C. § 822(d) (2014). 2858 45 U.S.C. § 822 (h)(1)(A) (2014). See also, 45 U.S.C. §§ 822(h)(1)(B) and (C) (2014).
556 that âthe direct loan or loan guarantee is justified by the present and probable future demand for rail services or intermodal facilitiesâ¦.â2859 One of the requirements for assistance is that the Secretary must determine the amount of a credit risk premium that must be paid before the disbursement of any loan.2860 The factors that the Secretary must consider are identified in 45 U.S.C. § 822(f)(2), including the applicantâs circumstances and the proposed schedule of loan disbursements.2861 Lastly, the subsidy cost is the estimated long term cost to the government of a loan or loan guarantee, which âmay be funded by Federal appropriations, direct payment of a Credit Risk Premium by the Applicant or a non-Federal infrastructure partner on behalf of the Applicant, or any combination thereof.â2862 As defined by the regulations, a credit risk premium is the portion of the total subsidy cost to the government of a direct loan or loan guarantee not covered by federal appropriations that must be paid by the applicant or its non-federal âinfrastructure partnerâ before disbursement of a direct loan or the issuance of a loan guarantee.2863 When â[f]ederal appropriations are inadequate to cover the subsidy cost, a non- 2859 45 U.S.C. § 822(g)(1) and (2) (2014); see also, 45 U.S.C. §§ 822(g)(3)-(5) (2014), but see 49 C.F.R. § 260.9 (2014) that states that the repayment period may not exceed 25 years. 2860 45 U.S.C. §§ 8222(f)(2) and (3) (2014). See also, 49 C.F.R. § 260.13 (2014). That is, a credit risk premium must be paid before there is a full or incremental disbursement of a direct or guaranteed loan. See 49 C.F.R. § 260.15(c) (2014). 2861 45 U.S.C. §§ 822(f)(2)(A) and (B) (2014). See also, 45 U.S.C. §§ 822(f)(2)(C)-(F) (2014). 2862 49 C.F.R. § 260.13 (2014). 2863 49 C.F.R. § 260.3(e) (2014).
557 Federal infrastructure partner may pay to the Administrator a Credit Risk Premium adequate to cover that portion of the subsidy cost not covered by Federal appropriations.â2864 Of course, if direct loans or loan guarantees under RRIF do not cover the complete cost of a project, other financing or investment may be needed for a project. 2. Project Eligibility Under the statute and regulations financial assistance is available to: (A) acquire, improve, or rehabilitate intermodal or rail equipment or facilities, including track, components of track, bridges, yards, buildings, and shops; (B) refinance outstanding debt incurred for the purposes described in subparagraph (A); or (C) develop or establish new intermodal or railroad facilities.2865 However, financial assistance under the program may not be used to pay railroad operating expenses.2866 Article 3. Repurposing RRIF to include Commuter Rail According to one source, â[t]t is now time to transform RRIF into a source of financing for large commuter rail projects.â2867 The RRIF has been shown to be a successful model that has helped short-haul rail companies to expand and to acquire new freight rail facilities and 2864 49 C.F.R. § 260.15(a) (2014). 2865 45 U.S.C. §§ 822(b)(1)(A)-(C) (2014); 49 C.F.R. §§ 260.5(a)(1)-(3) (2014). 2866 45 U.S.C. § 822(b)(2) (2014); 49 C.F.R. § 260.5(b) (2014). 2867 Barney A. Allison, âPerspective: Refining RRIF to Include Commuter Railâ (Jan. 15, 2014), available at: http://www.railwayage.com/index.php/passenger/commuter-regional/perspective-refining-rrif-to- include-commuter-rail.html?channel=56 (last accessed March 31, 2015).
558 equipment.2868 Although the funding program reportedly has up to $35 billion for use only about $1.7 billion has been spent since 1998; seventy-two percent of the loans have been provided to Class II and III railroads.2869 The article argues that â[d]emand for public transportation is real and growing, but oddly, commuter rail demand lags other modesâ and that âgreater frequency and interconnectivity will increase ridership, meeting an untapped demand of currently underserved riders.â2870 The article states that providing RRIF funding for commuter rail may be accomplished by following the TIFIA-model for highways whereby RRIF could be a source of âlow-cost debt capital for commuter rail[] with some mode-appropriate changes.â2871 RRIF could accomplish this objective by considering creditworthy revenue streams such as sales taxes, use of credit ratings, the use of TIFIA and RRIF together, and the development of credit criteria for greater predictability rather than utilizing only hard assets as collateral.2872 The article concludes that practitioners should convince the House Transportation and Infrastructure Committee to repurpose the RRIF to expand commuter rail.2873 2868 Id. 2869 Id. 2870 Id. 2871 Id. 2872 Id. 2873 Id.
559 Statutes E. Railway-Highway Crossings Program 1. Funding The purpose of the Railway-Highway Crossings Program is to reduce the number of injuries and fatalities at public grade crossings.2874 As with the TIFIA program the source of the funds is the Highway Trust Fund.2875 A stateâs funding is determined based on formula factors for the Surface Transportation Program and the number of railway-highway public grade crossings.2876 Overall, each state is guaranteed at least .5% of the program funds.2877 When a state qualifies for funding the federal share is ninety percent.2878 2. Project Eligibility To receive funding for railway-highway crossings a state must survey all highways to determine the railroad crossings that require attention. A railroad must compensate the state transportation department for ten percent of the net benefit of a railroad project. The state must submit annual reports and update the United States Department of Transportation National Crossing Inventory, which is a national database that includes information on each public 2874 U.S. Department of Transportation, Federal Highway Administration, âRailway-Highway Crossings Program Fact-Sheet,â available at: https://www.fhwa.dot.gov/map21/factsheets/rhc.cfm (last accessed March 31, 2015), hereinafter referred to as âRailway-Highway Crossings Program;â MAP-21 § 1519, 23 U.S.C. § 130 (2014). 2875 Id. 2876 Id.; MAP-21 § 1519, 23 U.S.C. § 130 (2014). 2877 Id. 2878 Railway-Highway Crossings Program, supra note 2874; 23 U.S.C. § 130(f)(3) (2014).
560 crossing within a stateâs borders, such as warning devices and signage.2879 All previous projects that were eligible under 23 U.S.C. § 130 continue to be eligible.2880 Statutes F. The American Recovery and Reinvestment Act (ARRA) 1. Stimulus Funds for Passenger Rail Projects The AARA, enacted in 2009, provides short-term funding for sectors across the economy, including agriculture, labor, education, health, housing, and infrastructure projects. The majority of the authorized funding has been used and should be depleted between 2014 and 2016.2881 The ARRA funds are âobligatedâ to a specific project and work may begin or continue on a project after funds are committed to the project.2882 Congress made $8 billion available through ARRA to develop high-speed intercity passenger rail service in the United States. In April 2009 FRA published a High-Speed Rail Strategic Plan and in June 2009 launched the High-Speed Intercity Passenger Rail (HISPR) program.2883 2879 Railway-Highway Crossings Program, supra note 2874; 23 U.S.C. §§ 130(a)-(l) (2014). 2880 Railway-Highway Crossings Program, supra note 2874. 2881 ARRA, P.L. 111-5 (2009). 2882 U.S. Department of Transportation, Federal Transit Administration, âAmerican Recovery and Reinvestment Act,â available at: http://www.fta.dot.gov/about/12835.html (last accessed March 31, 2015). 2883 Federal Railroad Administration, High-Speed Rail Overview, available at: https://www.fra.dot.gov/Page/P0060 (last accessed March 31, 2015).
561 2. Project Eligibility ARRA funding may be made available to current recipients of FTAâs Urbanized Area Formula Program (49 U.S.C. § 5307); Formula Grants for other than Urbanized Areas Program (49 U.S.C. § 5311); Fixed Guideway Modernization Formula Program (49 U.S.C. § 5309); federally recognized tribes (49 U.S.C. § 5311(c) (1)); and Capital Investment Grants (49 U.S.C. § 5309).2884 2884 Federal Transit Administration, available at: http://www.fta.dot.gov/about/12835_9325.html#Eligibility (last accessed March 31, 2015).
562 XXIII. FEDERAL RAILROAD SAFETY ACT A. Introduction In 1970, Congress enacted the Federal Railroad Safety Act (FRSA) to ensure the national uniformity of safety regulations for railroads. Section B discusses the statutory elements, the limited ability of states to establish their own regulations to address âlocal safety or security hazard[s],â i.e., the local hazards savings clause, and the FRSAâs preemption of state laws so as to protect whistleblowers who report safety violations.2885 Sections C, D, and E, respectively, discuss cases applying the FRSA, such as to a local regulation on grade crossings and to the preemption of negligence claims under state law against railroad companies. Finally, Section F discusses an article on the 2007 amendment to the FRSA clarifying the statuteâs preemption of state laws. Statute B. Federal Railroad Safety Actâs Regulation of Every Area of Railroad Safety The FSRA authorizes the Secretary of Transportation to prescribe regulations for every area of railroad safety2886 and for the âinvestigative and surveillance activities necessary to enforce the safety regulations.â2887 Because of the legislative intent that laws, regulations, and orders related to railroad security will be ânationally uniform,â2888 the FRSA preempts state or municipal laws to the extent practicable, including state laws regarding whistleblowers.2889 2885 49 U.S.C. § 20101, et seq. (2014). 2886 49 U.S.C. § 20103(a) (2014). 2887 49 U.S.C. § 20105(a) (2014). 2888 49 U.S.C. § 20106(a)(1) (2014). 2889 See Rayner v. Smirl, 873 F.2d 60 (4th Cir. 1989).
563 However, when ânecessary to eliminate or reduce an essentially local safety or security hazardâ a state may adopt an âadditional or more stringent law, regulation or order.â2890 The local hazards savings clause is an exception to preemption under the FRSA for âspecific local hazards ⦠that the Secretary of Transportation did not and, as a practical matter, could not take into account in determining laws or regulations under the FRSA.â2891 1. Amendments to 49 U.S.C. §§ 20109(a)(1)-(7) of the FRSA by the 9/11 Commission Act of 2007 Originally, the FRSA provided that âa railroad carrier ⦠may not ⦠discriminate against an employee if such discrimination is dueâ to the employeeâs lawful act to âfile a complaint, or directly cause to be brought a proceedingâ regarding the enforcement of railroad safety laws or to testify or agree to testify in such a proceeding.2892 Section 1521 of the Implementing Recommendations of the 9/11 Commission Act of 2007 (9/11 Commission Act of 2007) amended the FRSA by increasing the type of protected activities in which a railroad employee may engage. Although the reader should consult the entire statutory section, a railroad employee is permitted: (1) to provide information ⦠or otherwise directly assist in any investigation regarding any conduct which the employee reasonably believes constitutes a violation of any Federal law, rule, or regulation relating to railroad safety or security, or gross fraud, waste, or abuse of Federal grants or other public funds intended to be used for railroad safety or security, if the information or assistance is provided to or an investigation [as defined in subsections (A) through (C) of subsection (1)] stemming from the provided informationâ¦. 2890 49 U.S.C. § 20106(a)(2) (2014). 2891 Boyd v. National R.R Passenger Corp., 62 Mass. App. Ct. 783, 792, 821 N.E.2d 95, 103 (Mass. App. Ct. 2005), revâd, 2006 Mass. LEXIS 119 (2006) (reversal discussed in part XXIII.C). 2892 49 U.S.C. §§ 20109(a) and (a)(3) (2014).
564 (2) to refuse to violate or assist in the violation of any Federal law, rule, or regulation relating to railroad safety or security; (3) to file a complaint, or directly cause to be brought a proceeding related to the enforcement of this part or, as applicable to railroad safety or security, chapter 51 or 57 of this title, or to testify in that proceeding; (4) to notify, or attempt to notify, the railroad carrier or the Secretary of Transportation of a work-related personal injury or work-related illness of an employee; (5) to cooperate with a safety or security investigation by the Secretary of Transportation, the Secretary of Homeland Security, or the National Transportation Safety Board; (6) to furnish information to the Secretary of Transportation, the Secretary of Homeland Security, the National Transportation Safety Board, or any Federal, State, or local regulatory or law enforcement agency as to the facts relating to any accident or incident resulting in injury or death to an individual or damage to property occurring in connection with railroad transportation; or (7) to accurately report hours on duty pursuant to chapter 211.2893 2. Amendments to 49 U.S.C. §§ 20109(b)(1)-(7) of the FRSA by the 9/11 Commission Act of 2007 Prior to the 2007 amendments, the FRSAâs provision on employees and protection from hazardous conditions prohibited railroad carriers from retaliating against railroad employees who refused to work in hazardous conditions.2894 As amended by § 1521 of the 9/11 Commission Act of 2007, the FRSAâs provisions on whistleblower protection now state that a railroad carrier engaged in interstate or foreign commerce or an officer thereof shall not shall not discharge, demote, suspend, reprimand, or in any other way discriminate against an employee for â (A) reporting, in good faith, a hazardous safety or security condition; (B) refusing to work when confronted by a hazardous safety or security condition related to the performance of the employeeâs duties, if the conditions described in paragraph (2) exist; or (C) refusing to authorize the use of any safety-related equipment, track, or structures, if the employee is responsible for the inspection or repair of the 2893 49 U.S.C. §§ 20109(a)(1)-(7) (2014) (as amended by the 9/11 Commission Act of 2007, §§ 1521(a)(1)-(7)). 2894 49 U.S.C. § 20109(b) (2014).
565 equipment, track, or structures, when the employee believes that the equipment, track, or structures are in a hazardous safety or security condition, if the conditions described in paragraph (2) exist.2895 3. Transfer of Enforcement of Whistleblower Protection from the National Railroad Adjustment Board to the Occupational Safety and Health Administration Section 1521 of the 9/11 Commission Act of 2007 also amended the FRSA by transferring enforcement of whistleblower complaints from the National Railroad Adjustment Board to the Occupational Safety and Health Administration (OSHA).2896 An employee who alleges retaliation for whistleblowing may file a complaint with the Secretary of Labor.2897 If the Secretary of Labor has not issued a final decision within 120 days, the complainant may file an 2895 49 U.S.C. §§ 20109(b)(1)(A)-(C) (2014) (as amended by 9/11 Commission Act of 2007, §§ 1521(b)(1)(A)-(C)). Under subjection (C)(2) (as amended by the 9/11 Commission Act of 2007, §§ 1521(b)(2)(a)(A)-(C)), a refusal is protected under paragraph (1)(B) and (C) if â (A) the refusal is made in good faith and no reasonable alternative to the refusal is available to the employee; (B) a reasonable individual in the circumstances then confronting the employee would conclude thatâ (i) the hazardous condition presents an imminent danger of death or serious injury; and (ii) the urgency of the situation does not allow sufficient time to eliminate the danger without such refusal; and (C) the employee, where possible, has notified the railroad carrier of the existence of the hazardous condition and the intention not to perform further work, or not to authorize the use of the hazardous equipment, track, or structures, unless the condition is corrected immediately or the equipment, track, or structures are repaired properly or replaced. 2896 49 U.S.C. §§ 20109(c) and (d) (2014) (as amended by the 9/11 Commission of 2007 Act, §§ 1521(c) (Enforcement Action) and (c)(1) (âby filing a complaint with the Secretary of Laborâ) and 1521(d) (Remedies). OSHA is part of the Department of Labor and is tasked with assuring safety and healthful working conditions. 2897 49 U.S.C. § 20109(d)(1) (2014).
566 action in a United States District Court.2898 The remedies available to a prevailing complainant include âall relief necessary to make the employee wholeâ including reinstatement, backpay, with interest and compensatory damages.2899 In certain cases, punitive damages up to $250,000 may be awarded.2900 The provisions on whistleblower protection also allow other federal or state laws to provide safeguards against discrimination in railroad employment.2901 The intent is to provide âbroad scale federal legislationâ without âdisturb[ing] these existing railroad safety laws.â2902 4. Amendments to the FRSA by Section 419 of the Railroad Safety Improvement Act of 2008 Section 419 of the Railroad Safety Improvement Act of 2008 amended the FRSA by prohibiting a railroad carrier from âdisciplin[ing], or threaten[ing] discipline to, an employee for requesting medical or first aid treatment, or for following orders or a treatment plan of a treating physician.â2903 An employee may follow the process (see preceding subsection 3 of this part of 2898 49 U.S.C. § 20109(c)(3) (2014). 2899 49 U.S.C. § 20109(e)(1)-(2) (2014). 2900 49 U.S.C. § 20190(d)(3) (2014). 2901 49 U.S.C. § 20109(g) (2014). 2902 Frank J. Mastro, âPreemption is not Dead: The Continued Vitality of Preemption Under the Federal Railroad Safety Act following the 2007 Amendment to 49 U.S.C. § 20106,â 37 Transp. L. J. 1, 6 (2010), hereinafter referred to as âMastro.â 2903 49 U.S.C. § 20109(c)(2) (2014). Under the statute the term ââdisciplineâ means to bring charges against a person in a disciplinary proceeding, suspend, terminate, place on probation, or make note of reprimand on an employeeâs record.â Id.
567 the Report) to enforce an action for retaliatory discipline against a railroad carrier.2904 OSHA has promulgated regulations to handle complaints of retaliation under the FRSA.2905 5. Increase in OSHAâs FRSA Whistleblower Complaints Whistleblower complaints for violations of the FRSA have become an increasingly significant part of OSHA whistleblower docket. Since 2007 when OSHA acquired jurisdiction of FRSA complaints, OSHAâs number of FRSA-based complaints has increased from 1 in fiscal year 2007 to 384 and 353 complaints, respectively, in fiscal years 2012 and 2013.2906 The percentage of OHSAâs docket of FRSA whistleblower complaints has increased from 1% in 2007 to 13.3% and 11.9%, respectively, for fiscal years 2012 and 2013.2907 Cases C. Whether an Exception under State Law for a Railroadâs Reckless Conduct Survives Preemption In Boyd v. National R.R. Passenger Corp.2908 Boyd, a fifteen-year-old girl, was struck and killed instantly by an Amtrak train at a grade crossing that was equipped with automatic safety gates, warning bells, and warning lights. Boydâs father commenced a wrongful death action against Amtrak, the Massachusetts Bay Transportation Authority (MBTA), and Prone, the 2904 49 U.S.C. § 20109(d)(1) (2014). 2905 29 C.F.R. § 1982.100, et seq. (2014). 2906 United States Department of Labor, Occupational Safety and Health Administration, Whistleblower Investigation Data FY2005-FY2013, available at: http://www.whistleblowers.gov/whistleblower/wb_data_FY05-13.pdf (last accessed March 31, 2015). 2907 Id. 2908 446 Mass. 540, 845 N.E.2d 356 (Sup. J. Ct. Mass. 2006).
568 engineer who was operating the train at the time of the accident.2909 The complaint alleged that Amtrak, the MBTA, and Prone were negligent; that there were statutory violations because of Amtrakâs and the MBTAâs failure to give adequate warnings; and that Amtrak and the MBTA were guilty of gross negligence and willful, wanton, or reckless conduct.2910 After the Superior Court dismissed the complaint, the Appeals Court of Massachusetts affirmed.2911 The appeals court held that dismissal below was proper, in part, because âlocal speed limit and safety gate requirements were preempted by the [FRSA] â¦. and related regulations promulgated by the [FRA]â¦.â2912 On review by the Supreme Judicial Court of Massachusetts, the issue on appeal was limited to the one issue of reckless conduct.2913 Although the issue was not directly before the Supreme Judicial Court, the Appeals Court of Massachusetts had held that the FRSA preempted Boydâs state law claims because the conditions at the crossing did not qualify as a local hazard under the savings clause and because â[g]eneral conditions at grade crossings are not local hazards because they are â[s]tatewide in characterâ and âamenable to uniform, national standards.â2914 Under the Massachusetts Wrongful Death statute, there is a specific exemption to liability for railroads that states that âa person operating a railroad shall not be liable for negligence in causing the death of a person while walking or being upon such railroad contrary to law or to the reasonable rules and 2909 Id., 446 Mass. at 540-541, 845 N.E.2d at 359. 2910 Id., 446 Mass. at 541, 845 N.E.2d at 359. 2911 Id. 2912 Id. (citation omitted). 2913 Id., 446 Mass. at 542, 845 N.E.2d at 360. 2914 Boyd v. Amtrak, 62 Mass. App. Ct. 783, 792, 821 N.E.2d 95, 103 (2005).
569 regulations of the carrierâ ... However, even where a decedent is a trespasser, a railroad can be held liable for damages if the conduct of its agents that caused such death was wilful, wanton, or reckless.2915 After reviewing the evidence, the Supreme Judicial Court concluded that Boyd had presented sufficient evidence to raise a triable issue of fact on whether the defendants were reckless.2916 First, â[b]y sounding the horn only 600 to 700 feet from the grade crossing, Prone effectively halved the amount of time that Boyd could escape an accident once she started across the tracks and realized that a train was bearing down on her.â2917 Second, the plaintiffâs evidence, âif believed, would suggest that Prone had been exceeding the federally prescribed speed limit at the time the train hit Boyd.â2918 The court stated that the exception for reckless conduct is much more than mere negligence and a difficult bar to reach: [T]he risk created by a defendantâs conduct must be substantially greater than that which would constitute negligence, and the risk must be one involving an easily perceptible danger of death or grave physical harm. ⦠This is a significant distinction, and our decision should not be interpreted as diminishing in any way the high evidentiary standard that must be satisfied in order to establish reckless conduct, rather than negligence.2919 2915 Boyd, 446 Mass. at 546, 845 N.E.2d at 362 (citations omitted) (emphasis supplied). 2916 Id., 446 Mass. at 549, 845 N.E.2d at 365. 2917 Id., 446 Mass. at 551, 845 N.E.2d at 366. 2918 Id., 446 Mass. at 552, 845 N.E.2d at 366. 2919 Id., 446 Mass. at 553, 845 N.E.2d at 367 (citation omitted).
570 D. Under the FRSA only Federal Regulations and Orders of the Secretary of Transportation Establish a Federal Standard of Care that Preempts State Law In Sanchez v. BNSF Railway Company2920 the plaintiff Sanchez filed a negligence claim against BNSF for personal injuries that Sanchez sustained because of BNSFâs use of allegedly oversized ballast that caused Sanchez to fall. After BNSF removed the case to a federal district court in New Mexico on the ground of diversity jurisdiction, BNSF moved for a summary judgment on the basis that the FRSA preempted Sanchezâs claim. BNSF argued that the â[p]laintiffâs claims âregarding the use of improper and oversized ballastâ are âwholly preempted by federal law.ââ2921 Quoting an opinion by the Sixth Circuit, the district court stated: Under the FRSAâs express preemption provision, â[l]aws, regulations, and orders related to railroad safety ⦠shall be nationally uniform to the extent practicable.â 49 U.S.C. § 20106(a)(1). âA State may adopt or continue in force a law, regulation, or order related to railroad safety ⦠until the Secretary of Transportation ⦠prescribes a regulation or issues an order covering the subject matter of the State requirement.â 49 U.S.C. § 20106(a)(2). A state-law negligence action is âcoveredâ and therefore preempted if a FRSA regulation âsubstantially subsume[s]â the subject matter of the suit.2922 The court explained that âthe âclarification amendmentâ to 49 U.S.C. § 20106, titled âClarification Regarding State Law Causes of Action,â [explained] ⦠that Congress merely was clarifying that âFRSA preemption does not apply when a railroad violates a federal safety standard of care.ââ2923 Sanchez argued that âsuch a standard apparently is to be implied from the 2920 2013 U.S. Dist. LEXIS 147656, at *1 (D. N.M. 2013). 2921 Id. at *3 (citation omitted). 2922 Id. at *10 (quoting Nickels v. Grand Trunk W. R.R., Inc., 560 F.3d 426, 429 (6th Cir. 2009)). 2923 Id. at *13 (quoting Henning v. Union Pacific Railroad Co., 530 F.3d 1206, 1214-1216 (10th Cir. 2008)).
571 engineering standards for ballast promulgated by the American Railway Engineering and Maintenance of Way Associationâ (AREMA).2924 However, the court rejected the argument because â[a]s the clarification amendment to the FRSA preemption provision provides, the federal standard of care is âestablished by a regulation or order issued by the Secretary of Transportation (with respect to railroad safety matters).ââ2925 The AREMA standards did not establish a federal standard of care because they were not issued by the Secretary and were merely non-binding recommendations.2926 Thus, the court granted BNSFâs motion for a summary judgment on Sanchezâs ballast-related claims. E. Exclusive Federal Whistleblower Protection for Railroad Employees In Rayner v. Smirl2927 Rayner, an employee of CSX, was allegedly discharged in retaliation after observing several safety violations and reporting them to his supervisors. At issue was whether the FRSA provided exclusive whistleblower protection that preempted the plaintiffâs state law claim. The 1980 amendments to the FRSA provided that a ârailroad carrier ⦠may not discharge ⦠an employeeâ because such employee has âfiled any complaint or instituted or caused to be instituted any proceeding under or related to the enforcement of the Federal railroad safety laws.â2928 Not only did the statute include an explicit preemption 2924 Id. at *14. 2925 Id. (citation omitted). 2926 Id. (citation omitted). 2927 873 F.2d 60, 62 (4th Cir. 1989), cert. denied, 493 U.S. 876, 110 S. Ct. 213, 107 L. Ed.2d 166 (1989), superseded by statute as stated in Gonero v. Union Pac. R.R. Co., 2009 U.S. Dist. LEXIS 100962, at *1 (E.D. Cal. 2009). 2928 Id. at 63 (quoting 45 U.S.C. § 441(a)).
572 provision,2929 but also the legislative history demonstrated a clear congressional intent to provide uniform protection to all railroad employees who report safety violations.2930 The courtâs opinion further explained: Congress presumably believed that this statutory âwhistleblowerâ provision was a law ârelating to railroad safetyâ when it included it in the Federal Railroad Safety Authorization Act of 1980 and codified it in the United States Code under the title of âRailroad Safety.â â¦. The comprehensive remedial scheme for aggrieved railroad employees provided in § 441 serves to confirm its preemptive scope. The parties may petition for a hearing before the National Railroad Adjustment Board and may be represented by counsel. An employee who prevails before the Board may seek enforcement of the Boardâs order in the federal district courts, and either party may petition the federal district courts for review of the Boardâs decisions.2931 The Fourth Circuit held that 45 U.S.C. § 441 âprovides a broad federal remedy for railroad âwhistleblowersââ and that the court would ârefuse to narrow this federal remedial provision to allow appellant to pursue a state action in tort.â2932 Furthermore, âthe âwhistleblowerâ provision of the [FRSA] provides appellant a federal remedy for his employerâs alleged retaliatory actsâ and, therefore, § 441 preempted Raynerâs cause of action under Maryland law for wrongful discharge.2933 While affirming the judgment of the district court, the court stated that the affirmance of the dismissal of Raynerâs complaint was without prejudice so that he could pursue his federal administrative remedies.2934 2929 Id. at 65. 2930 Id. 2931 Id. 2932 Id. at 64. 2933 Id. at 67.
573 Article F. The FRSAâs Continued Preemption of State Laws since the 2007 Amendment An article published in the Transportation Law Journal examines the state of federal preemption under the FRSA after the 2007 amendment.2935 In two Supreme Court cases decided before the amendment, the Court held that the FRSA preempted state âcommon law tort duties.â2936 The two decisions prompted concern that the FRSA did not provide a cause of action for a party injured by a railroadâs alleged tortious acts, and, therefore, in some cases the FRSA had produced harsh results.2937 In enacting the 2007 amendment, Congress clarified the FRSA by listing exceptions to the general rule of preemption.2938 The article states that the â[c]ourts have been uniform in ruling that the amended § 20106 does not permit railroads to remove state court actions to federal court based on the complete preemption doctrine,â but â[t]he inability to remove a case under the complete preemption doctrine ⦠does not preclude a railroad from raising preemption as an affirmative defense.â2939 Although the rule of complete preemption no 2934 Id. 2935 Mastro, supra note 2902, at 3. 2936 Id. at 7 (citing CSX Transp. Inc. v. Easterwood, 507 U.S. 658, 113 S. Ct. 1732, 123 L. Ed.2d 387 (1993); Norfolk So. Ry. Co. v. Shanklin, 529 U.C. 344, 120 S. Ct. 1467, 146 L. Ed.2d 374 (2000)). 2937 Mastro, supra note 2902, at 12. 2938 Id. at 12-17; see also, 49 U.S.C. § 20106(a)(2) (2014) (the local hazards savings clause) and 49 U.S.C. § 20106(b) (2014) (providing that an action under state law for damages for personal injuries allegedly caused by a partyâs failure to comply with a federal standard of care, state law, or the partyâs own standard is not preempted). 2939 Mastro, supra note 2902, at 21 (footnotes omitted).
574 longer applies,2940 âthe statute will continue to assure that federal regulations regarding particular areas of railroad safety will supersede state laws covering the same subject.â2941 2940 Id. at 25. 2941 Id.
575 XXIV. FEDERAL SAFETY APPLIANCE ACT A. Introduction The original Safety Appliance Act was enacted by Congress in 1893 to promote the safety of employees and travelers on the railroads.2942 This part of the Report discusses the safety appliances that are required by the current Federal Safety Appliance Act (FSAA) and the application of the FSAA to a claim for the death or injury of a railroad employee.2943 Section B discusses statutory provisions on safety precautions and devices, including the standards for safety devices under the FSAA and the requirements applicable to safety appliances under the federal regulations. Section B also discusses civil penalties that may be imposed for violations of the FSAA. Section C discusses cases arising out of a violation of the FSAA resulting in death or injury, the determination of when a train is in use under the FSAA, whether a violation of the FSAA is negligence per se for the purpose of a FELA claim, whether handbrakes must work properly every time they are used, and whether it is a question of law whether a device is governed by the FSAA, as well as an article on specific safety devices and appliances that are required under the FSAA. Section D calls attention to rules published by the American Association of Railroads. 2942 Safety Appliance Act, 27 Stat. 531 (March 2, 1893); see 49 U.S.C. §§ 20301-20306 (2014). 2943 Magelky v. BNSF Ry. Co., 579 F. Supp.2d 1299 (D. N.D. 2008) (âThe duty imposed on a railroad carrier by the Federal Safety Appliance Act is an absolute one.â) (citing Brady v. Terminal R.R. Assân of St. Louis, 303 U.S. 10, 15, 58 S. Ct. 426, 82 L. Ed. 614 (1938)).
576 Statutes and Regulations B. Regulation of Railroad Equipment Safety 1. Standards for Safety Devices under the FSAA The FSAA describes the devices that railroads have to install prior to using a vehicle or railcar.2944 For example, under the statute a railroad may use only vehicles that have couplers that attach automatically and that do not require an individual to pass between vehicles to uncouple them.2945 The FSAA also requires that a vehicle must have secure sill steps, efficient hand brakes, secure ladders, and handholds;2946 that locomotives must be âequipped with a power-driving wheel brake and appliances for operating the train-brake system;â2947 and that a train be equipped properly so that an engineer may control the speed of the train with the braking system.2948 2. Requirements for Safety Appliances under the Federal Regulations The requirements for specific safety appliances are described in more detail in the federal regulations.2949 For instance, locomotives used in switching are required to have four switching steps that have to be on each side of the locomotive at each end of the locomotive.2950 The 2944 49 U.S.C. § 20302 (2014). 2945 49 U.S.C. § 20302(a)(1)(A) (2014). 2946 49 U.S.C. §§ 20302(a)(1)(A)-(B) (2014). 2947 49 U.S.C. § 20302(a)(4) (2014). 2948 49 U.S.C. § 20302(a)(5) (2014). 2949 49 C.F.R. § 231.0 (2014). 2950 49 C.F.R. § 231.30(c) (2014).
577 switching steps must have vertical handrails on each side of the steps.2951 Moreover, locomotives built after 1975 may not have end footboards or pilot steps.2952 The FSAA allows defective vehicles to be moved from one track to another without incurring a civil penalty.2953 However, a railroad company does not escape liability for death or injury of a railroad employee as the result of moving a defective vehicle.2954 3. No Assumption of Risk by Railroad Employees An employee of a railroad carrier does not assume the risk of injury resulting from the use of a train that is in violation of the FSAA.2955 Even if an employee âcontinues to be employed by the carrier after learning of [a] violationâ of the FSAA, the employee âdoes not assume the risk of injury.â2956 4. Civil Penalties for Violations of the FSAA Civil penalties are separate from a claim for damages. Under the regulations any person who violates federal railroad safety laws is subject to civil penalties.2957 For example, if a person negligently creates a risk of injury or death or actually causes injury or death to occur, the person is liable for civil penalties not exceeding $105,000 per incident.2958 A person includes âa 2951 49 C.F.R. § 231.30(e) (2014). 2952 49 C.F.R. § 231.30(d) (2014). 2953 49 U.S.C. §§ 20303(a) and 21302 (2014). 2954 49 U.S.C. § 20303(c) (2014). 2955 49 U.S.C. § 20304 (2014). 2956 Id. 2957 49 C.F.R. § 229.7(b) (2014).
578 railroad; any manager, supervisor, official, or other employee or agent of a railroad; any owner, manufacturer, lessor, or lessee of railroad equipment, track, or facilities; [and] any employee of such owner, manufacturer, lessor, lessee or independent contractor.â2959 The federal regulations also provide a number to call when an accident occurs.2960 Accidents are investigated by the Federal Railroad Administration (FRA).2961 The regulations include a schedule of civil penalties.2962 Civil penalties imposed by the Secretary of Transportation may be collected by a civil action filed in a federal district court.2963 Cases C. Claims for Injury or Death of Employees for a Violation of the FSAA 1. When a Train is âIn Useâ under the FSAA In Deans v. CSX Transportation, Inc.2964 when Deans, a conductor who was assigned to take a train from West Virginia to Maryland, checked the hand brakes on the railcars prior to departure, Deans was able to release all of the hand brakes on the cars except one.2965 On the fourth attempt to disengage the brake Deans experienced pain in his neck and back and had to be 2958 Id. 2959 Id. 2960 49 C.F.R. § 229.17(a) (2014). 2961 Id. 2962 49 C.F.R. § pt. 229, app. B (2014). 2963 49 U.S.C. § 21302(a)(2) and (b) (2014). 2964 152 F.3d 326 (4th Cir. 1998). 2965 Id. at 328.
579 treated at a hospital.2966 An inspection revealed that the brake was defective.2967 Deans sued CSX under the FSAA, claiming that CSX was liable for his injuries.2968 Finding that the railcar was not in use for purposes of the FSAA, the district court granted the railroad companyâs motion for a summary judgment.2969 However, the Fourth Circuit reversed the judgment of the district court on Deansâ FSAA claim and remanded.2970 The FSAA âimposes absolute liability on railroad carriersâ for violations of the law if a train is âin useâ at the time of an accident.2971 The FSAA provides that a railroad company shall not use a vehicle on its line if it lacks efficient hand brakes.2972 The court, therefore, had to determine whether the train was in use within the meaning of the FSAA in deciding whether CSX was liable for injuries caused by deficient hand brakes. The Fifth Circuit had held that a train was not in use when an employee was injured while checking a trainâs brakes prior to the conductor taking control.2973 On the other hand, the Fourth Circuit had held that a train was in use when the engine had been inspected and the train declared ready for use.2974 2966 Id. 2967 Id. 2968 Id. 2969 Id. 2970 Id. at 331. 2971 Id. at 328. 2972 Id. (quoting 49 U.S.C. § 20302(a)). 2973 Id. at 329 (citing Trinidad v. S. Pac. Transp. Co., 949 F.2d 187 (5th Cir. 1991) (holding that a train is in use when switching and pre-departure inspections are complete and the train is assembled)). 2974 Id. at 329 (citing Angell v. Chesapeake & Ohio Ry. Co., 618 F.2d 260 (4th Cir. 1980)).
580 In Deans, the Fourth Circuit held that the primary factors in determining whether a train was in use at the time of an accident are the location of the train and the activity of the injured party.2975 In Deans, the train was ready for departure and the conductor was attempting to put the train in motion.2976 Thus, the court held that the train was in use at the time of the accident and reversed the district courtâs grant of a summary judgment for CSX.2977 2. When a Violation of the FSAA is Negligence Per Se for the Purpose of a FELA Claim In Marshall v. Grand Trunk W. R.R. Co.,2978 decided by a federal district court in Michigan, the plaintiff Marshall was an employee of Grand Trunk W. R.R. Co. (Grand Trunk) when he suffered injuries in four separate incidents. Marshall suffered injuries to his knees and back when the sill step on the train gave way beneath him on two different occasions; when he was ordered to walk along a steep hill to find a trainâs brake problem; and when he slipped on ice while using a ground switch to move tracks.2979 Marshall brought an action against the railroad under FELA.2980 Under FELA Marshall had to prove that the railroad was negligent.2981 However, if Grand Trunk had violated the FSAA, the railroadâs violation constituted negligence per se under 2975 Id. 2976 Id. at 330. 2977 Id. at 331. 2978 850 F. Supp.2d 686, 689 (W.D. Mich. 2011). 2979 Id. at 690-692. 2980 Id. at 689. 2981 Id. at 695.
581 FELA.2982 The FSAA does not provide a right of action by itself but does provide a basis for an injured employeeâs claims under FELA.2983 Therefore, the FSAA and FELA are to be applied together.2984 Furthermore, the court held that to prove an FSAA violation Marshall did not have to show that Grand Trunk had prior notice of the defect.2985 One of Marshallâs claims arose because he had walked on steep ground to repair a brake system. Marshall argued that but for the malfunction of the brake system he would not have walked on steep ground for the long distance that caused his injury.2986 However, the court held that the defect in the trainâs brake system did not cause his injury.2987 Although Marshallâs motion for a summary judgment was denied, the claim was preserved for trial.2988 As for the two separate incidents when a sill step collapsed under Marshall, the court held that Grand Trunk was negligent per se for failing to maintain the steps and granted Marshall a summary judgment on the claims.2989 As for Marshallâs claim based on slipping on ice, although the court granted Marshallâs motion for a summary judgment on the ground that the railroad was negligent per se, 2982 Id. at 696-697. 2983 Id. at 696 (quoting 49 U.S.C. § 20302; 45 U.S.C. § 51). 2984 Id. at 697. 2985 Id. at 698. 2986 Id. at 699. 2987 Id. 2988 Id. at 708. 2989 Id. at 700.
582 the jury or trial judge would have to determine the nature and extent of his injuries and the appropriate amount of damages.2990 3. Requirement that Efficient Handbrakes Work Properly Every Time they are Used In Schroeder v. Grand Truck W. R.R. Co.,2991 decided by a Michigan federal district court, the plaintiff Schroeder was injured when attempting to engage a handbrake. When Schroeder was in the process of tightening the handbrake it suddenly released and pulled his arm with it.2992 Schroeder sued the railroad company, Grand Trunk, under the FSAA and FELA.2993 Schroederâs handbrake expert testified that the handbrake that injured the plaintiff was defective.2994 Although the expert noted that a handbrake may work inefficiently in one incident and efficiently the next, a handbrakeâs performance is adequate only when it works efficiently every time; an inefficient handbrake violates the FSAA.2995 The expert testified that an employee operating such a handbrake would only be able to determine whether there was a problem with the brake when the employee is properly trained, thus suggesting that Schroeder was not trained to recognize defects.2996 The court denied Grand Trunkâs motion for a summary judgment.2997 2990 Id. 2991 2011 U.S. Dist. LEXIS 139233, at *1, 4 (E.D. Mich. Dec. 5 2011). 2992 Id. at *4-5. 2993 Id. at *9. 2994 Id. at *10. 2995 Id. 2996 Id. at *11.
583 4. Whether a Device comes within the FSAA is a Question of Law In Johnson v. Union Pacific R. Co.2998 the plaintiff Johnson was inspecting a Union Pacific train when he noticed a loose support for an air hose. Johnson signaled to the conductor to stop the train so that Johnson could walk between the cars and secure the loose support.2999 While the plaintiff was securing a strap, the train lurched forward and ran over his foot.3000 Johnson sued Union Pacific under FELA and the FSAA.3001 To determine whether Union Pacific was strictly liable under the FSAA, a federal district court in California first discussed the kinds of appliances that are subject to the FSAA, a decision that is a question of law.3002 Although the FSAA does not define the term safety appliance, it does enumerate the appliances to which the Act applies.3003 Union Pacific argued that the fact that a support strap is not listed in the statute means that it is not a safety appliance that is subject to the FSAA.3004 However, the court held that the list of safety appliances should be understood to mean categories of appliances.3005 The court held that the support for the air hose was part of the brake system and, therefore, a safety appliance under the statute.3006 Johnsonâs evidence was 2997 Id. at *34. 2998 2004 U.S. Dist. LEXIS 22151, at *1, 2 (N.D. Cal. Oct. 27, 2004). 2999 Id. at *2. 3000 Id. at *3. 3001 Id. at *4. 3002 Id. at *6. 3003 Id. at *6-7 (citing 49 U.S.C. § 20302(a)(1)). 3004 Id. at *7-8. 3005 Id. at *8 (citing Jordan v. S. Ry. Co., 970 F.2d 1350, 1354 (4th Cir. 1992)).
584 sufficient to support the courtâs holding, including his evidence that the support system must be secured properly to avoid interference with the brake system.3007 Because a support strap is a safety appliance under the FSAA, if a strap is found to be defective, the railroad is strictly liable for the defective condition.3008 The court denied the railroadâs motion for a summary judgment.3009 5. When a Violation of the FSAA is Negligence for the Purpose of an Indemnity Claim In Burlington Northern R.R. Co. v. Farmers Union Oil Co. of Rolla3010 Farmers Union Oil Company (Farmers Union) and Burlington Northern Railroad Company (Burlington Northern) had entered into an industrial track lease with an indemnity clause. Two employees of Farmers Union noticed that a brake on a railroad car was sticking but did not notify Burlington Northern.3011 Rolla Grain, another company with which Burlington Northern had a track lease agreement and that operated grain elevators nearby, received the same railroad car from Farmers Union along with several other railroad cars that were delivered directly by Burlington Northern to be loaded with grain.3012 Thereafter, an employee of Rolla Grain suffered injuries because of the same defective car.3013 Burlington Northern settled the action with the injured employee for 3006 Id. at *12. 3007 Id. at *11. 3008 Id. at *12. 3009 Id. at *13. 3010 207 F.3d 526, 529 (8th Cir. 2000). 3011 Id. at 530. 3012 Id.
585 $400,000 and then sought $200,000 from Farmers Union and Rolla Grain.3014 The case centered on whether the facts of the incident triggered an indemnity clause in the track lease agreement between Burlington Northern and Farmers Union.3015 To determine whether an act or omission by Farmers Union had occurred for purposes of the indemnity provision, the court first analyzed the duties of Burlington Northern and Farmers Union under the FSAA.3016 Burlington Northern had a duty to secure safe and functional brakes on its railroad cars as required by the FSAA, and if Burlington Northern failed to maintain safe brakes the company had violated FELA.3017 Farmers Union had a duty to assist Burlington Northern in maintaining effective brakes, a duty that Farmers Union breached when it failed to notify Burlington Northern of the defective brake.3018 The court held that an act or omission had occurred under FELA.3019 Although Farmers Union argued that Burlington Northernâs violation of the FSAA determined Burlington Northernâs negligence, the court rejected the argument.3020 The court relied on another precedent from the Eighth Circuit, Colorado Milling & Elevator Co. v. 3013 Id. 3014 Id. 3015 Id. at 530-531. 3016 Id. at 532. 3017 Id. 3018 Id. 3019 Id. 3020 Id. at 533.
586 Terminal R. Assân of St. Louis,3021 in support of its holding that the FSAA violation was not enough to establish Burlington Northernâs negligence because of a defective railroad car.3022 Burlington Northernâs lessee of the railcar failed to prove that Burlington Northern could have discovered the defect through an inspection or that the railcar was defective before the lessee received it.3023 Because Farmers Union failed to provide sufficient evidence of Burlington Northernâs negligence, the court held that Farmers Union owed $200,000 to Burlington Northern under the indemnity provision.3024 Article 6. Specific Safety Devices and Appliances Required Under the FSAA As discussed in an article available on line, the FSAA mandates that trains have train brakes that allow the engineer to control the speed of the train; secure running boards, handholds, grab irons, sill steps and ladders; and functional couplers so that employees do not have to pass between cars to uncouple them.3025 Moreover, the FSAA does not permit any part of a brake system, including air hoses, air reservoirs, and connecting pipes, to be defective.3026 3021 350 F.2d 273 (8th Cir. 1965). 3022 Burlington N. R.R. Co., 207 F.3d at 533. 3023 Id. 3024 Id. at 534. 3025 FELA Federal Safety Appliance Act, Online Lawyer Source, available at: http://www.onlinelawyersource.com/fela/safety-act/ (last accessed March 31, 2015). 3026 Id.
587 D. Rules Published by the American Association of Railroads Also relevant to the regulation of railroad equipment safety are rules published by the American Association of Railroads (AAR):3027 the Office Manual of the AAR Interchange Rules3028 and the Field Manual of the AAR Interchange Rules.3029 The Office Manual âcombines mandatory rules covering all aspects of billing car repairs, mechanical requirements for new or rebuilt cars ⦠settlement of disputes, and transfers and adjustments of lading.â3030 The Field Manual âcontains all the rules dealing with care and repair, responsibility for, disposition of, [and] settlement of freight cars.â3031 As an Illinois appellate court has held, the rules do not have the force of law, but â[e]vidence of standards, safety rules, regulations, and codes are admissible to aid the finder of fact in deciding the standard of care in negligence actions.â3032 A violation of a rule is not negligence per se, because a party charged with violating an AAR rule may introduce evidence that it acted reasonably under the circumstances in not complying with the standard.3033 3027 The AARâs members include most of the large and small freight railroads in the United States, Canada and Mexico. See Association of American Railroads, AAR Members Across the Globe, available at: https://www.aar.org/Pages/AboutUs.aspx?t=aarmembers (last accessed March 31, 2015). 3028 Association of American Railroads, Office Manual of the AAR Interchange Rules (2015), hereinafter referred to as âInterchange Rules.â 3029 Association of American Railroads, Field Manual of Interchange Rules (2015). 3030 Interchange Rules, supra note 3028. 3031 See https://www.aar.org/StatisticsAndPublications/Publications/Documents/Catalog.pdf (last accessed March 31, 2015). 3032 Grimming v. Alton & S. R. Co., 204 Ill. App.3d 961, 991, 562 N.E.2d 1086, 1105 (Ill. App. Ct. 5th Dist. 1990) (internal quotation marks omitted) (quoting M. Graham, Cleary & Graham, Handbook of Illinois Evidence § 406.5 (5th ed. 1990)). 3033 Id. 204 Ill. App.3d at 992, 562 N.E.2d at 1106.
588 XXV. HIGH-SPEED RAIL A. Introduction It is a longstanding national policy to âpromote the construction and commercialization of high-speed ground transportation.â3034 Federal law authorizes the Secretary of Transportation to âlead and coordinate federal effortsâ to âfoster the implementation of ⦠high-speed steel wheel on rail transportation systems.â3035 The United States has encouraged investment in the development of a high-speed rail system most recently through the American Recovery and Reinvestment Act (ARRA). However, the articles discussed herein highlight the need for greater awareness and investment to ensure the eventual success of high-speed rail projects. Sections B and C discuss, respectively, the development of high-speed rail and funding provided by the ARRA. Sections D and E summarize articles that address what is needed for the development of high-speed rail and the current level of reportedly insufficient funding for its development. Statutes B. Development of High-Speed Rail The Secretary may award contracts and grants and establish related national programs for demonstrations to determine the contribution of high-speed rail to more efficient ground transportation systems or enter into cooperative research and development agreements with companies in the United States for the purpose of overcoming technical barriers and transferring 3034 49 U.S.C. § 302(d) (2014). 3035 49 U.S.C. § 309(a) (2014).
589 technologies for high-speed rail.3036 The Secretary has a statutory obligation to âsubmit to Congress a study of the commercial feasibilityâ of high-speed ground transportation systems and to establish the necessary national policy.3037 C. Funding by the American Recovery and Reinvestment Act In 2009, Congress enacted the American Recovery and Reinvestment Act or ARRA. The Act specifically provided $8 billion in funding for passenger rail capital projects with priority given to the development of intercity high-speed rail.3038 The ARRA directed the Secretary to âsubmit to the House and Senate Committees on Appropriations a strategic plan that describes how the Secretary will use the funding provided under this heading to improve and deploy high speed passenger rail systems.â3039 In 2009 Secretary Ray LaHood submitted such a strategic plan. The plan outlined the background and context for the development of high-speed rail; a proposed strategy for the creation of a rail network, including how projects will be funded, selected, and implemented; and the next steps necessary to proceed with projects, such as input from stakeholders and the public.3040 3036 49 U.S.C. §§ 309(b) and (c) (2014). 3037 49 U.S.C. §§ 309(d) and (e) (2014). 3038 111 P.L. 5, 123 Stat. 115 (2009); see 26 U.S.C. § 1 note (2014). 3039 Id. (Title XII subsection Federal Railroad Administration: Capital Assistance for High Speed Rail Corridors and Intercity Passenger Rail Service). 3040 United States Department of Transportation, Vision for High Speed Rail in America: High-Speed Rail Strategic Plan (April 2009), available at: http://www.fra.dot.gov/eLib/Details/L0283 (last accessed March 31, 2015).
590 Articles D. Continued Growth of High-Speed Rail A law review article argues that âhigh-speed rail transit would serve as a meaningful form of alternative transportation.â3041 The article contends that the âpolitical will and growing public-private partnershipsâ could overcome the âchallenges in adopting high-speed trains within existing transportation schemes.â3042 Although the construction, maintenance, and operation of high-speed rail transit involve enormous costs, high-speed rail would âcreate[] economic integration among various regionsâ and re-direct the use of energy from sources other than traditional fossil fuels to âcleaner forms of nuclear energy.â3043 The article argues that the demonstrated advantages and recent success of high-speed transit increase the political will to foster its continued growth in the United States. E. Insufficient Funding for High Speed Rail According to one source, studies have shown that âhigh speed rail operating at an average speed of more than 150 mph can compete favorably with air travel over distances of 500 miles or less.â3044 However, given the difficulties in construction and maintenance, the cost would be âanywhere from $400-$800 billionâ to establish a successful nationwide high-speed rail 3041 Kamaal R. Zaidi, âHigh Speed Rail Transit: Developing the Case for Alternative Transportation Schemes in the Context of Innovative and Sustainable Global Transportation Law and Policy,â 26 Temp. J. Sci. Tech. & Envtl. L. 301, 302 (2007). 3042 Id. 3043 Id. at 339. 3044 Joshua Rogers, Note, âThe Great Train Robbery: How Statutory Construction may have Derailed an American High Speed Rail System,â 2011 U. Ill. J.L. Tech. & Polây 215, 224 (2011).
591 system.3045 The article states that the $8 billion grant authorized by the ARRA âwhen projected over an equal period of timeâ is nearly identical to the three percent of federal funding historically provided for traditional passenger rail over the last fifty years, a percentage that is insufficient to stimulate the development of high-speed rail.3046 The author proposes the establishment of âa federal high speed rail administration to provide a continual stream of financing.â3047 3045 Id. at 227. 3046 Id. 3047 Id. at 235.
592 XXVI. INSURANCE AND INDEMNITY AGREEMENTS A. Introduction According to one source, unlike motor vehicles, in general railroads are not required to carry insurance.3048 However, railroad companies often purchase insurance and have indemnification agreements to protect them in the conduct of their business and operations.3049 Sections B through D discuss Mandatory Insurance for the Feeder Railroad Development Program; Railway-Highway Liability Insurance; and the Amtrak Reform and Accountability Act of 1997. Section E discusses cases involving railway-highway liability insurance. Section F analyzes cases dealing with disputes over insurance coverage, such as the use of a declaratory judgment action to determine the partiesâ rights and duties and escape clauses and excess insurance. Section G reports on cases involving indemnification agreements, including whether 49 U.S.C. § 28103 preempts state law on such agreements and whether an indemnity clause in an agreement is a waiver of sovereign immunity. Section H discusses arbitration of disputes arising under indemnification agreements, such as whether a public policy defense precludes enforcement of an arbitration agreement and whether an arbitral panel may enforce an indemnity agreement notwithstanding the other partyâs gross negligence that resulted in the liability claims sought to be indemnified. Finally, sections I and J discuss a report issued by the United States Government Accountability Office regarding insurance arrangements between freight railroads and railroad passenger service and alternative insurance arrangements for the transportation of hazardous material. 3048 Matthew Bender & Company, Inc., Transportation Safety and Insurance Law § 19.04 (LexisNexis 2013). 3049 See, e.g., CSX Transportation, Inc. v. Mass. Bay Transp. Auth., 697 F. Supp.2d 213 (D. Mass. 2010); Orr v. Indiana Harbor Belt R.R., 976 F. Supp. 1151 (N.D. Ill. 1997).
593 Statutes B. Mandatory Insurance for the Feeder Railroad Development Program The Feeder Railroad Development Program includes a statutory mandate that private railroads must carry insurance.3050 The program permits the Surface Transportation Board (STB) to force a sale of a rail line to âallow[] shippers, communities, or other interested parties to acquire rail lines before an abandonment application is filedâ3051 and therefore prevent abandonment of the line. The application to participate in the program must include the insurance coverage carried by the railroad.3052 The regulations require that an applicant seeking to use the tracks of another railroad obtain insurance to indemnify a railroad owner for any personal or property damage caused by the applicantâs negligence.3053 C. Railway-Highway Insurance Protection When the Federal Highway Administration (FHWA) provides funding for highway construction projects that affect property owned by railroads, the federal government may pay for public liability insurance for contractors3054 and for insurance for property damage for the 3050 49 U.S.C. § 10907 (2014); see 49 C.F.R. § 1151.3(8) (2014). 3051 Surface Transportation Board, Office of Public Services, So You Want to Start a Small Railroad: Surface Transportation Board Small Railroad Application Procedures at 20, available at: http://www.stb.dot.gov/stb/docs/So_You_Want_to_Start_Small_RR.pdf (last accessed March 31, 2015). 3052 49 C.F.R. § 1151.3(8) (2014). 3053 Id. 3054 Public liability insurance protects the insured from claims brought by members of the public for injuries or property damages resulting from the insuredâs activities. Heitz Insurance Agency, âGeneral Liability Insurance vs Public Liability Insuranceâ (2012), available at: http://www.heitzinsurance.com/2012/03/06/general_liability_vs_public_liability_insurance/ (last accessed March 31, 2015).
594 contractors and railroads.3055 The regulations also provide that contractors must purchase protective insurance for railroads when the work involves eliminating railroad-highway crossing hazards or takes place partially or completely in a railroadâs right-of-way.3056 The insurance is âlimited to damage suffered by the railroad on account of occurrences arising out of the work of the contractor on or about the railroad right-of-way, independent of the railroadâs general supervision or control, except [for the negligence of certain railroad employees].â3057 D. Amtrak Reform and Accountability Act of 1997 The Amtrak Reform and Accountability Act of 1997 (ARAA), which limited the liability to rail passengers to $200 million,3058 was the result of freight railroads requesting increased compensation associated with the risks of sharing a freight railroadâs right of way.3059 The ARRA also provided that â[a] provider of rail passenger transportation may enter into contracts that allocate financial responsibility for all claimsâ so that state law would not interfere with the railroadsâ indemnification agreements.3060 An earlier Senate Report explained the rationale for indemnity provisions: Amtrak and the freight railroads believe legislation is necessary to confirm enforceability of the indemnification agreements they have entered into regarding operation over each othersâ rail lines, notwithstanding allegations of gross 3055 23 C.F.R. §§ 646.101-111 (2014). See 23 U.S.C. §§ 109(e), 120(c), 130, 133(d)(1), and 315 (2014). 3056 23 C.F.R. § 646.107 (2014). 3057 23 C.F.R. § 646.109(a) (2014). 3058 49 U.S.C. § 28103(a)(2) (2014). 3059 Amtrak Reform and Accountability Act of 1997, S. Rep. No. 105-85, at 5 (1997), available at: http://www.gpo.gov/fdsys/pkg/CRPT-105srpt85/html/CRPT-105srpt85.htm (last accessed March 31, 2015), hereinafter referred to as âS. Rep. No. 105-85.â 3060 49 U.S.C. § 28103(b) (2014).
595 negligence by a freight railroad or Amtrak. As long as there is the possibility that state laws governing indemnification contracts may make these contracts unenforceable, Amtrak and a freight railroad may find themselves litigating with each other. Amtrak believes that such litigation inevitably would not only adversely impact business relationships between Amtrak and the host freight railroads, but it would also lead to significantly higher outlays in settlements and judgments to plaintiffs.3061 Under the ARAA, Amtrak also is required to âmaintain a total minimum liability coverage for claims through insurance and self-insurance of at least $200,000,000 per accident or incident.â3062 Cases E. Railway-Highway Liability Insurance In Orr v. Indiana Harbor Belt Railroad3063 the plaintiff Orr, a railroad employee, sustained an injury working on the Indiana Harbor Belt Railroad (IHB).3064 IHB alleged that a construction company negligently allowed debris to fall onto the railroad that injured Orr; thus, IHB filed a cross-claim seeking contribution from the construction company.3065 In accordance with the regulations in 23 C.F.R. § 646, because the project crossed over part of IHBâs right of way, the construction company had agreed to obtain liability insurance to cover the railroad for any injuries caused by the construction companyâs work.3066 A federal district court in Illinois 3061 S. Rep. No. 105-85, supra note 3059, at 5. 3062 49 U.S.C. § 28103(c) (2014). 3063 976 F. Supp. 1151 (N.D. Ill. 1997). 3064 Id. at 1152. 3065 Id. 3066 Id. at 1152-53.
596 applied Illinois state law to determine whether in a FELA case IHB could seek contribution from a third party.3067 The court cited a previous Illinois case that held that [w]hen parties to a business transaction mutually agree that insurance will be provided as part of the bargain then that agreement must be interpreted as providing mutual exculpation to the bargaining parties. The parties are deemed to have agreed to look solely to the insurance in the event of loss and not impose liability on the part of the other party.3068 The district court held that because the parties had agreed only to use the insurance in the event of an injury, IHB could not seek contribution from the construction company.3069 The court granted the construction companyâs motion for judgment as a matter of law.3070 F. Disputes over Insurance Coverage 1. Use of Declaratory Judgment Action to Determine Insurance Coverage In All America Insurance Company v. Steadfast Insurance Company3071 two insurance companies, All America Insurance Company (All America) and Central Mutual Insurance Company (Central Mutual), brought a declaratory judgment action against the defendant Steadfast Insurance Company (Steadfast). Steadfast had issued a Contingent Liability Insurance Policy â Railroad Equipment to Chicago Freight Car and Leasing Company (CFCL) that applied, according to All American and Central Mutual, to CFCLâs defense in another lawsuit pending in 3067 Id. at 1152. 3068 Id. at 1153 (quoting Briseno v. Chicago Union Station Co., 197 Ill. App.3d 902, 905, 557 N.E.2d 196, 198 (Ill. App. 1990)). 3069 Id. 3070 Id. at 1154. 3071 2011 U.S. Dist. LEXIS 54435, at *1 (N.D. Ind. 2011).
597 an Illinois state court.3072 The complaint in the declaratory judgment action stated that the plaintiff Central Mutual was defending CFCL in the state court action. The complaint in the declaratory judgment action concerned the plaintiffsâ claim that the Steadfast policy covers CFCL for the loss that is alleged to have occurred in the state court action, a claim that arose out of a welderâs injuries sustained on a CFCL railcar that resulted in the welderâs death two days after the incident.3073 Steadfast contends that the state court lawsuit does not come within the terms of the policy it issued to CFCL and that Steadfast does not have an obligation to defend CFCL. Although the court duty denied Steadfastâs motion to dismiss the complaint, the court stated that â[i]n Indiana, declaratory judgment actions to determine insurance coverage are not uncommon, and they are often a preferred method for insureds and insurers to litigate contractual rights under insurance policies.â3074 2. Escape Clauses and Excess Insurance In Federal Insurance Co. v. Lexington Insurance Co.3075 two insurance companies supplied insurance policies to Trona Railway Co. (Trona) that was involved in a lawsuit. Federal Insurance Co. (Federal) issued Trona a policy entitled âLiability Insurance for Energy Industriesâ that covered up to $1 million for each instance of bodily injury falling within the policy and included coverage for both property damage and personal injury.3076 Lexington Insurance Co. (Lexington) issued a âRailroad Liability Insuranceâ policy that similarly provided 3072 Id. at *1-2. 3073 Id. at *3, 11. 3074 Id. at *10-11. 3075 2011 U.S. Dist. LEXIS 91375, at *1 (C.D. Cal. 2011). 3076 Id. at *1-2.
598 coverage for property damage and personal injury and covered Trona up to $2 million for each instance of bodily harm coming within the policy.3077 The issue concerned each policyâs âother insuranceâ clauses. Federalâs policy stated that if Trona had another insurance policy that also covered a claim coming within Tronaâs policy, Federalâs policy was excess insurance. Moreover, Federal would not have to defend Trona if any other insurance company had a duty to defend Trona.3078 Lexingtonâs policy, on the other hand, stated that it provided excess insurance if Trona had other insurance that met specific requirements.3079 A federal district court in California explained that excess insurance âis expressly understood by both the insurer and the insured to be secondary to specific underlying coverage which will not begin until after that underlying coverage is exhausted and which does not broaden that underlying coverage.â3080 Under California law, disputes regarding âother insuranceâ may arise only between insurers at the same level of coverage.3081 The court held that both policies provided primary insurance because liability attached under the policies as soon as an incident occurred that was covered by the policy.3082 Furthermore, the court held that as a matter of public policy Federal should not be able to use a clause âburied in a general liability 3077 Id. at *3. 3078 Id. at *2-3. 3079 Id. at *4. 3080 Id. at *11 (quoting American Cas. Co. v. Gen. Star Indem. Co., 125 Cal. App.4th 1510, 1521, 24 Cal. Rptr.3d 34 (2005)). 3081 Id. 3082 Id.
599 policyâ to escape its obligations to provide primary insurance coverage.3083 Thus, the court held that Federal could seek equitable contribution, rather than equitable subrogation, from Liberty because both policies provided primary insurance coverage.3084 G. Indemnification Agreements 1. Whether 49 U.S.C. § 28103 Preempts State Law In CSX Transportation, Inc. v. Massachusetts Bay Transportation Authority3085 a federal district court in Massachusetts ruled that 49 U.S.C. § 28103(b), which allows railroads to enter into indemnification agreements, did not preempt a Massachusetts law that prohibited a party from indemnifying another party for injuries or damage caused by gross negligence or recklessness. CSX brought an action for a declaratory judgment against the Massachusetts Bay Transportation Authority (MBTA) to compel the MBTA to indemnify and defend CSX in a wrongful death action.3086 The wrongful death action involved one of MBTAâs employees who was struck and killed by a CSX train.3087 CSX and the MBTA had signed a trackage rights agreement (TRA) that required the MBTA to indemnify CSX for any injuries sustained by MBTA employees working on CSXâs rails.3088 The court held that the MBTA was obligated to defend CSX and to indemnify CSX 3083 Id. at *15. 3084 Id. at *16. 3085 697 F. Supp.2d 213 (D. Mass. 2010). 3086 Id. at 216. 3087 Id. 3088 Id. at 217.
600 under the contract.3089 The court stated that â[o]n its face ⦠§ 28103(b) authorizes the MBTA and CSX to enter into the TRA, but it does not deny Massachusetts the power to limit the agreementâs scope.â3090 Thus, the court held that federal law did not preempt the Massachusetts law because § 28103(b) does not limit the content of indemnification agreements, such as when the agreements provide indemnification for the other partyâs âgrossly negligent, reckless, willful, or wanton conduct.â3091 However, the court also held that the agreement to indemnify was unenforceable under Massachusetts state law as a matter of public policy to the extent that the MBTA agreed to indemnify CSX for âgrossly negligent, reckless, willful, or wanton conduct.â3092 In O&G Industries, Inc. v. Amtrak,3093 the Second Circuit held that § 28103(b) preempted a Connecticut law banning indemnity agreements in a construction contract when the agreement indemnified a party for acts caused by its own negligence. To gain access to parts of Amtrakâs railway to complete a construction project, O&G Industries, Inc. (O&G) agreed to provide full protection to Amtrak for any liabilities caused by O&G regardless of Amtrakâs fault or negligence.3094 The construction company attempted to use the Connecticut law in its defense against Amtrak in wrongful death and personal injury suits.3095 Nevertheless, the court held that 3089 Id. at 222-224. 3090 Id. at 230. 3091 Id. at 233. 3092 Id. 3093 537 F.3d 153 (2d Cir. 2008). 3094 Id. at 157. 3095 Id. at 159.
601 § 28103(b) preempted the Connecticut law because the Connecticut law would prevent Amtrak from entering into indemnification agreements protecting the railroad from liability for any claim arising from the construction project, which § 28103(b) expressly authorized.3096 Therefore, the court affirmed the district courtâs grant of Amtrakâs motion for judgment as a matter of law.3097 2. Interpretation of Indemnification Provisions In Fekete v. Amtrak3098 the plaintiffâs dump truck was damaged because of Amtrakâs alleged negligence while delivering stone to Amtrakâs property on behalf of the quarry where the stone originated. Amtrak had an agreement with the quarry that included an indemnity provision.3099 Amtrak argued that the quarry should indemnify Amtrak because the damage arose out of work performed under the contract and because the language of the contract was sufficiently broad to include liabilities caused by Amtrakâs negligence.3100 A federal district court in Pennsylvania recognized that contracts do not require specific terms to indemnify a party for its own negligence; however, the court held that the contractual provision did not include such a provision.3101 The contract included a provision that the quarry would indemnify Amtrak âirrespective of any negligence or fault on the part ofâ Amtrak for claims based on âinjuries (including death) to any of [the quarryâs] employees, agents or 3096 Id. at 161-162. 3097 Id. at 168. 3098 2012 U.S. Dist. LEXIS 109771, at *1 (E.D. Penn. 2012). 3099 Id. at *2. 3100 Id. at *6. 3101 Id. at *7.
602 subcontractors.â3102 Although the claim related to property damage instead of bodily injury, the provision that indemnified Amtrak âagainst any and all claims and liabilityâ related to the contractual work and did not mention negligence.3103 After Amtrak argued that § 28103(b) should not prevent Amtrak from enforcing its indemnity agreement, the court distinguished the separate issues of being able to enter into an indemnification agreement and of interpreting the terms of an indemnification agreement. The court explained: This principle is not in dispute here. If the indemnification provision before this Court was clear that Amtrak and Dyer intended that Dyer would indemnify Amtrak for Amtrakâs negligence, neither federal law nor the laws of the District of Columbia would prevent this Court from giving full effect to that intent. But the Court will not redraft the provision to ensure it includes the sweeping language Amtrak failed to include.3104 Therefore, the court held that the quarry was liable only for claims resulting from Amtrakâs negligence that involve personal injury or wrongful death, not property damage as in this case.3105 3. Whether Indemnity Clause in a Lease Waives Sovereign Immunity In Apfelbaum v. National Railroad Passenger Corporation3106 the action arose out of an alleged slip-and-fall accident at the 30th Street Station in Philadelphia owned by the Southeastern Pennsylvania Transportation Authority (SEPTA) that was leased to Amtrak. 3102 Id. at *14-15. 3103 Id. at *8, *15-16. 3104 Id. at *16. 3105 Id. at *17. 3106 2002 U.S. Dist. LEXIS 20321, at *1 (E.D. Pa. 2002).
603 SEPTA moved for summary judgment on the basis of sovereign immunity on the co-defendantsâ cross-claims against SEPTA. The co-defendants argued that SEPTA waived its immunity when it agreed to indemnify Amtrak âfrom any and all liability arising from or in connection with the use or occupation of the 30th Street Station as part of the lease agreementâ¦.â3107 A federal district court in Pennsylvania granted SEPTAâs motion because a claim against a Commonwealth party is actionable only if the basis for the alleged governmental culpability falls within one of nine exceptions to immunity enumerated in the Sovereign Immunity Act (the âActâ), 42 Pa. Consol. Stat. § 8522(b).3108 The only possible exception to sovereign immunity that applied was the real estate exception that permits an action when âa âdangerous condition of commonwealth agency real estateâ caused the claimed injury.â3109 For the real estate exception to apply to a claim involving government property, a plaintiff must establish that there was âan artificial condition or defect of the property itselfâ that did ânot arise from a source outside the property.â3110 Based on Pennsylvania judicial precedents, the court ruled that slip-and-fall cases do not come within the meaning of the real estate exception to sovereign immunity. Second, the district court held that SEPTA had not waived its immunity in the lease. Relying on the Supreme Court of Pennsylvaniaâs decision in City of Philadelphia v. Gray, 3111 the court held âthat a Commonwealth agency may not do indirectly what it is expressly 3107 Id. at *2. 3108 Id. at *5-6. 3109 Id. at *6 (footnote omitted). 3110 Id. at *7 (emphasis in the original) (quoting Finn v. City of Philadelphia, 541 Pa. 596, 664 A.2d 1342, 1343-1344 (Pa. 1995)). 3111 534 Pa. 467, 633 A.2d 1090 (Pa. 1993).
604 forbidden to do directly, and may not waive its immunity by âany procedural devise,â to include contract, and expose itself to liability foreclosed by the legislature.â3112 Thus, SEPTA had not waived its immunity and could not be made a party to the negligence actions.3113 H. Arbitration of Disputes arising under Indemnification Agreements 1. Whether a Public Policy Defense Precludes Enforcement of an Arbitration Agreement National Railroad Passenger Corporation v. Consolidated Rail Corporation3114 involved the collision on January 4, 1987, of a Conrail locomotive with an Amtrak train on Amtrakâs main passenger line near Chase, Maryland. The accident resulted in the deaths of fifteen passengers and the Amtrak engineer and caused injuries to hundreds of other passengers and some railroad employees.3115 With respect to later liability claims against Conrail, Conrail sought to invoke a clause in the Operating Agreement (OA) between it and Amtrak that, according to Conrail, obligated Amtrak to defend Conrail against the plaintiffsâ claims and to indemnify Conrail for liability arising from their injuries or deaths.3116 Amtrakâs position was that the indemnification clause was contrary to public policy and unenforceable to the extent that Conrail sought to 3112 Apfelbaum, 2002 U.S. Dist. LEXIS 20321 at *13 (footnote omitted). 3113 Id. at *13. 3114 892 F.2d 1066 (D.C. Cir. 1990). 3115 Id. at 1067. 3116 Id.
605 extend the clause to cover âconduct more culpable than ordinary negligence and ⦠punitive damages.â3117 Conrail brought an action in a federal district court in the District of Columbia to compel Amtrak to arbitrate based on the arbitration clause. The district court held that âpublic policy will not allow enforcement of indemnification provisions that appear to cover such extreme misconduct because serious and significant disincentives to railroad safety would ensue.â3118 In reversing the district court, the District of Columbia Circuit stated that âthere is no question that the parties agreed to arbitrate this dispute.â3119 Furthermore, the court held that the district court âerred in treating the arbitration clause as unenforceable merely because the substantive contract provision in dispute between the parties may -- if the district court is correct about public policy -- be unenforceable.â3120 The appeals court further stated: For a court to intervene before the arbitrator has determined what the contract means, and what it requires in the particular circumstances of their dispute, because he may determine that it requires the performance of an unlawful act, prematurely disrupts the system of private ordering upon which âpublic policyâ -- as declared in the Arbitration Act and in the Supreme Court cases liberally interpreting it -- places maximum possible reliance.3121 3117 Id. 3118 Id. (internal quotation marks omitted). 3119 Id. at 1069. 3120 Id. at 1070. 3121 Id. at 1071.
606 Thus, the district court could not âbypass the arbitration process simply because a public policy issue might arise.â3122 In vacating the declaratory judgment below, the appeals court reversed the district courtâs order denying Conrailâs motion to compel arbitration.3123 2. Arbitral Decision Enforcing Indemnity Agreement notwithstanding Other Partyâs Gross Negligence that Resulted in Liability Claims Maryland Transit Administration v. National Railroad Passenger Corporation,3124 decided by a federal district court in Maryland, concerned cases that arose out of arbitrations involving the Maryland Transit Administration (MTA) and the National Railroad Passenger Corporation (Amtrak).3125 In brief, on June 17, 2002, a northbound Amtrak intercity passenger train destined for New York proceeded through a âstop indicationâ and collided with a southbound commuter train just south of the Baltimore train station, causing âsignificant damage.â3126 At issue was a January 1, 1994, agreement (Agreement) between the MTA and Amtrak (as successor to CSX Transportation, Inc.) for the provision of equipment, personnel, and various services to the MTA regarding its operation of commuter rail passenger service between Perryville, Maryland, and Washington, D.C.3127 The Agreement contained a âbroad arbitration clause.â3128 3122 Id. 3123 Id. at 1073. 3124 372 F. Supp.2d 478 (D. Md. 2005). 3125 Id. at 479. 3126 Id. at 480. 3127 Id. at 479-480. 3128 Id. at 480.
607 A majority of the panel in the first arbitration, not discussed herein, determined that the Amtrak locomotive engineerâs gross negligence caused the accident.3129 In the second arbitration, Amtrak asserted that because of § 10 of the Agreement the MTA was required to provide insurance coverage to Amtrak for the June 2002 accident, notwithstanding the first arbitral panelâs determination that the cause of the accident was the Amtrak locomotive engineerâs gross negligence. However, a majority of the panel in the second arbitration agreed with Amtrak, holding that by reason of the Agreement the âMTA had contractually bound itself to procure liability insurance to protect both itself and Amtrak from losses arising out of accidents of the type involved here.â3130 The district court held that even if the arbitrators had erred in their decision they had âcommitted, at most, mere errors of lawâ that did not justify a vacatur of the arbitral award.3131 Articles I. Insurance Arrangements between Freight Railroads and Passenger Carriers In 2009, the United States Government Accountability Office issued a report on liability and indemnity provisions in agreements between freight railroads and commuter rail agencies.3132 The report found that regardless of fault commuter rail agencies usually must take 3129 Id. at 479, 481. 3130 Id. at 479. 3131 Id. at 484. 3132 United States Government Accountability Office, Commuter Rail: Many Factors Influence Liability and Indemnity Provisions and Options Exist to Facilitate Negotiations (2009), available at: http://www.stb.dot.gov/stb/docs/Liability%20Report%20letter%206-10.pdf (last accessed March 31, 2015).
608 on most of the liability and risk for commuter operations.3133 The report suggests options to facilitate negotiations between freight railroads and commuter rail agencies, such as giving commuter rail agencies more leverage by âproviding commuter rail agencies with statutory access to freight-owned infrastructureâ3134 and physically separating passenger rail from freight rail.3135 J. Alternative Insurance Arrangements for Transportation of Hazardous Material In âRail Transportation of Toxic Inhalation Hazards: Policy Responses to the Safety and Security Externalityâ3136 the authors make several policy recommendations on the transportation of toxic inhalation chemicals and discuss risk and liability alternatives for the transportation of such chemicals. The authors examine other insurance arrangements that distribute the risk of dangerous products that benefit the public, such as the Price-Anderson Actâs federal pool of funds for the nuclear power industry.3137 To compensate any future victims of nuclear accidents, nuclear reactors must have a certain level of insurance to create a primary pool.3138 If damages were to exceed the level of insurance, the licensees of nuclear reactors would have to contribute 3133 Id. at 5. 3134 Id. at 7. 3135 Id. 3136 Lewis M. Branscomb, Mark Fagan, Philip Auerswald, Ryan N. Ellis, and Raphael Barclan, âRail Transportation of Toxic Inhalation Hazards: Policy Responses to the Safety and Security Externality,â Harvard Kennedy School Belfer Center Discussion Paper #2010-01 (2010), available at: http://belfercenter.ksg.harvard.edu/files/Rail-Transportation-of-Toxic-Inhalation-Hazards-Final.pdf (last accessed March 31, 2015). 3137 Id. at 33. 3138 Id.
609 to a second pool.3139 The government then has the power to create a compensation system when damages exceed the second poolâs funds.3140 The authors recommend the creation of a compensation fund by producers, transporters, and users who are involved in the movement of toxic inhalation hazards3141 to âinternaliz[e] external costsâ associated with the inherent risk in the transportation of hazardous materials by rail.3142 3139 Id. 3140 Id. 3141 Id. at 65. 3142 Id. at 2.
610 XXVII. LABOR RELATIONS AND EMPLOYMENT A. Introduction Numerous federal laws affect the rights of employees in the railroad industry. Section B discusses the Railway Labor Act (RLA). The Act demonstrates a strong federal commitment to regulate labor relations in the railroad industry,3143 particularly railroad employeesâ collective bargaining rights.3144 The RLA established a mechanism for the resolution of disputes between railroad employers and their employees and provides the courts with the authority to enjoin strikes by employees and other actions that may circumvent procedures for dispute resolution.3145 Section B discusses the history and purpose of the RLA; arbitration of disputes under the RLA; the National Railroad Adjustment Boardâs (NRAB) exclusive jurisdiction over minor disputes; and other issues arising under the RLA, such as injunctions, preemption, and the regulations for certification of locomotive engineers. Section C discusses the Labor Management Relations Act (LMRA),3146 including suits by and against labor organizations, hybrid actions (claims by employees against both the employer and the union), and the applicable statutes of 3143 Alexandra Hegji, âFederal Labor Relations Statutes: An Overview,â Congressional Research Service 1 (2012), available at: http://www.fas.org/sgp/crs/misc/R42526.pdf (last accessed March 31, 2015), hereinafter referred to as âHegji.â 3144 45 U.S.C. § 152 (2014). 3145 Hegji, supra note 3143, at 1-2, 10. See also, Angie A. Welborn, âThe Railway Labor Act: Dispute Resolution Procedures and Congressional Authority to Intervene,â Congressional Research Service (2002), available at: http://congressionalresearch.com/RS20883/document.php?study=The+Railway+Labor+Act+Dispute+Res olution+Procedures+and+Congressional+Authority+to+Intervene (last accessed March 31, 2015). 3146 29 U.S.C. § 185 (2014).
611 limitations.3147 Section D addresses the federal requirement under certain circumstances that transit agencies must protect employeesâ collective bargaining and other rights by utilizing âprotective labor agreements.â3148 Section E addresses the rights of employees and the application of the First and Fourth Amendments of the United States Constitution to transit authorities. B. The Railway Labor Act Statutes and Regulations 1. History and Purpose of the Railway Labor Act After decades of labor unrest, which included widespread and often violent strikes, railroads and unions finally reached an agreement and jointly drafted what was designated as the Railway Labor Act of 1926.3149 Since its enactment there have been several important amendments, including one in 1934 that established the National Railroad Adjustment Board (NRAB)3150 and an amendment in 1951 that allowed carriers and unions to enter into union security agreements.3151 As one source explains, â[t]he NRAB is a federal tribunal under the National Mediation Board (NMB) that arbitrates grievances in the railroad industry.â3152 The NMB administers and enforces the RLA, âhas delegated its powers to investigate and adjudicate 3147 See UPS v. Mitchell, 451 U.S. 56, 66-67, 101 S. Ct. 1559, 1565-1566, 67 L. Ed.2d 732, 742-743 (1981). 3148 49 U.S. C. § 5333 (2014). 3149 âThe Railway Labor Act Simplified,â available at: http://www.pennfedbmwe.org/Docs/reference/RLA_Simplified.html (last accessed March 31, 2015). 3150 45 U.S.C. § 153 (2014). 3151 45 U.S.C. § 152 (2014). 3152 Hegji, supra note 3143, at 10.
612 representation disputes to its General Counsel[,] and oversees mediation and arbitration under the RLA.â3153 In 1966, Congress enacted additional amendments to the RLA that gave both parties in a dispute the right to request a Public Law Board (PLB); in 1981, Congress added emergency procedures to the RLA that are applicable to certain commuter rail carriers that are funded and operated by the government.3154 The amendments in 2012 to the RLA pursuant to the Federal Aviation Administration Modernization and Reform Act (FAAMRA) are the most recent changes. FAAMRA revised some rules governing union elections and certifications and required the NMB to conduct regular audits and evaluations.3155 The RLA âforbid[s] any limitation upon freedom of association among employeesâ and âprovide[s] for the prompt and orderly settlement of all disputes concerning rates of pay, rules, or working conditions.â3156 To fulfill these objectives, the Act both mandates and prohibits certain actions on the part of railroad companies, employees, and other involved parties. Section 152 provides that carriers and employees have the duty to exert every reasonable effort to settle disputes3157 and that employees during a dispute have the right to designate representatives without interference or coercion by an employer.3158 The Act provides that no carrier may 3153 Id. 3154 45 U.S.C. § 153 (2014); 45 U.S.C. 159a (c) (2014). See also Hegji, supra note 3143, at 4. 3155 P.L. 112-95, 126 Stat. 11 (2012) (codified at 45 U.S.C. §§ 151-52). See 29 C.F.R. §§ 1206.1(b) and 1206.2 (2014). See also Hegji, supra note 3143, at 4. 3156 45 U.S.C. § 151a (2014). 3157 45 U.S.C. § 152, First (2014). 3158 45 U.S.C. § 152, Third (2014).
613 require an employee to agree to join or not join a labor organization.3159 The NMBâs procedure for handling disputes that are cognizable under the RLA is set forth in 29 C.F.R. §§ 1206.1-8. 2. National Railroad Adjustment Board As stated, the NRAB was established by a 1934 amendment to the RLA.3160 A labor dispute âgrowing out of grievances or out of the interpretation or application of agreements concerning rates of pay, rules, or working conditionsâ may be referred to the NRAB if the chief operating officer of the carrier designated to handle the dispute fails to reach an adjustment of the dispute.3161 The decisions of the NRAB are subject to a narrow standard of judicial review, namely whether the NRAB failed to comply with its legal obligations, failed to confine itself to matters within the scope of its jurisdiction, or engaged in some form of fraud or corruption.3162 The rules of procedure for disputes before the NRAB are set forth in 29 C.F.R. §§ 301.1-01.9. The NRAB has four divisions with jurisdiction over different types of disputes; for example, the first division adjudicates âdisputes involving train- and yard-service employees of carriers.â3163 The second division adjudicates âdisputes involving machinists, boilermakers, blacksmiths, sheet-metal workers, electrical workers, car men, the helpers and apprentices of all the foregoing, coach cleaners, power-house employees, and railroad-shop laborers.â 3164 The third division exercises jurisdiction over âdisputes involving station, tower, and telegraph 3159 45 U.S.C. § 152, Fifth (2014). 3160 45 U.S.C. § 153, et seq. (2014) 3161 45 U.S.C. § 153(i) (2014). 3162 45 U.S.C. § 153(q) (2014). 3163 45 U.S.C. § 153(h) (2014). 3164 Id.
614 employees, train dispatchers, maintenance-of-way men, clerical employees, freight handlers, express, station, and store employees, signal men, sleeping-car conductors, sleeping-car porters, and maids and dining-car employees.â3165 The fourth division has jurisdiction over âdisputes involving employees of carriers directly or indirectly engaged in [the] transportation of passengers or property by water[] and all other employees of carriers over which jurisdiction is not given to the first, second, and third divisions.â3166 3. Arbitration of Disputes under the RLA The RLA structure divides labor disputes into major and minor disputes,3167 each of which has its own mechanism for dispute resolution. Minor disputes relate âto the meaning or proper application of a particular provision with reference to a specific situation or to an omitted case.â3168 Minor disputes, which typically involve employee grievances and discipline for alleged employee misconduct, must be arbitrated by the NRAB.3169 Major disputes are those concerning âthe formation of collective agreements or efforts to secure themâ and frequently relate to the negotiation, mediation and arbitration process utilized to avoid self-help (i.e., work stoppages and strikes) upon the expiration of a collective bargaining agreement.3170 Typically, if negotiations are not successful, the parties to a major dispute may request an NMB mediator, who thereafter may refer a dispute to arbitration if the parties are 3165 Id. 3166 Id. 3167 See Elgin, J. & E. Ry. v. Burley, 325 U.S. 711, 65 S. Ct. 1282, 89 L. Ed. 1886 (1945). 3168 Id., 325 U.S. at 723, 65 S. Ct. at 1290, 89 L. Ed. at 1894. 3169 45 U.S.C. §§ 153, First, (j), and (o), and § 155 (2014); Hegji, supra note 3143, at 12-13. 3170 Elgin, J. & E. Ry., 325 U.S. at 723, 65 S. Ct. at 1289-1290, 89 L. Ed. at 1894.
615 unable to resolve the dispute and agree to binding arbitration. If the parties decline arbitration and a mediation board concludes that a dispute âthreatens substantially to interrupt interstate commerce to a degree such as to deprive any section of the country of essential transportation service,â the President is authorized to set up an Emergency Board (PEB) under the RLA to find a resolution.3171 The PEB investigates the dispute, which may include hearings and meetings with the parties, and issues a non-binding report setting forth its conclusions with respect to the reasonableness of the partiesâ positions. During the pendency of a PEB investigation and for thirty days after the issuance of the Boardâs report, all parties must maintain the status quo.3172 Cases 4. NRABâs Exclusive Jurisdiction over Minor Disputes In Brotherhood of Maintenance of Way Employees Division/IBT v. Norfolk Southern Railway Co.3173 the plaintiff Brotherhood of Maintenance of Way Employees Division/IBT argued that Norfolk Southern violated the collective bargaining agreement (CBA) between it and the union. The plaintiff alleged that Norfolk Southern did so by the use [of] reports from third-party expert witnesses at the on-property disciplinary hearings it conducts concerning possible misconduct by BMWED-represented employees without having given notice or copies of such reports to the union in advance of the hearings and without bringing the experts to the hearings or otherwise making them available for questioning by the union.3174 3171 45 U.S.C. § 160 (2014). 3172 See Report of Presidential Emergency Board No. 245 (May 20, 2014)m available at: http://utu.org/worksite/PDFs/PEBS/PEB245Report.pdf (last accessed March 31, 2015) . 3173 2012 U.S. Dist. LEXIS 136649, at *1 (N.D. Ill. 2012). 3174 Id. at *1-2.
616 The CBA provided for the imposition of discipline only after a âfair and impartial investigation.â3175 A federal district in Illinois court relied on a previous precedent that set forth the standard for determining whether a case qualified as a minor dispute: Where an employer asserts a contractual right to take the contested action, the ensuing dispute is minor if the action is arguably justified by the terms of the partiesâ collective-bargaining agreement. Where, in contrast, the employerâs claims are frivolous or obviously insubstantial, the dispute is major.3176 The court held that Norfolk Southern claims were âarguably justified.â First, the CBA did not expressly prohibit the railroadâs practice of using third-party expert reports, and, second, the practice actually was consistent with Norfolk Southernâs and the unionâs past practices, as well as with common law applicable to the railroad industry.3177 Therefore, the court held that under its interpretation of the CBA the dispute qualified as a minor dispute, a decision that brought the matter under the NRABâs exclusive jurisdiction.3178 The court granted Norfolk Southernâs motion for a summary judgment.3179 Another example of a minor dispute is Litaker v. CSX Transportation, Inc.3180 Litaker sued CSX after it disciplined Litaker for disobeying his supervisorsâ instructions and continuing to submit payment claims for travel time and mileage to which Litaker was not entitled.3181 3175 Id. at *2. 3176 Id. at *52-53 (citation omitted) (emphasis in original). 3177 Id. at *59. 3178 Id. at *83. 3179 Id. 3180 2011 U.S. Dist. LEXIS 117060, at *1 (D. Md. 2011). 3181 Id. at *7-8.
617 Litaker argued that he was disciplined for pursuing the resolution of a minor dispute through the mechanisms of the RLA. CSX argued that it disciplined Litaker for âinsubordination pursuant to the collective bargaining agreements after he disobeyed the direct instructions of his supervisors when he continued to seek mileage reimbursement through the payroll system.â3182 CSX further argued that Litaker did not follow the grievance protocol in the CBA and that the entire dispute should be considered a minor dispute under the RLA.3183 A Maryland federal district court held that both the entitlement to travel pay and the discipline issue were minor disputes within the NRABâs exclusive jurisdiction.3184 CSXâs contention that the employee was ânot entitled to the travel pay ⦠is arguably justified by the terms ofâ certain contracts between the railroad and employee.3185 Furthermore, the issue of discipline âimplicates the discipline procedures ⦠[and] appears to turn on the interpretation of the term âclaimââ in one of the collective bargaining agreements.3186 Thus, the court granted CSXâs motion for a summary judgment.3187 5. Interpretation of Implied Agreements is a Minor Dispute In Kan. City Southern Ry. v. Bhd. of Locomotive Engârs & Trainmen3188 Kansas City Southern (KCS) and two unions disagreed over a decision to install inward facing video- cameras. Although a Louisiana federal district court had to decide on the method to use to 3182 Id. at *15. 3183 Id. 3184 Id. at *19, *23. 3185 Id at *19. 3186 Id. at *21-22. 3187 Id. at *24. 3188 2013 U.S. Dist. LEXIS 104622, at *1 (W. D. La, 2013).
618 resolve the issue,3189 a related issue was whether the dispute was a major or minor one under the RLA.3190 Major disputes require âconference, mediation, possibly voluntary arbitration, and a thirty day cooling-off period before either party may resort to economic self-help.â3191 Minor disputes, however, are to be âresolved through binding arbitration.â3192 In this case, because the unions previously had consented to surveillance practices the practices were regarded as implied agreements with KCS.3193 Thus, the court held that the dispute was a minor one regarding whether the implied agreements covered the installment of the cameras.3194 6. Preemption of State Law Claims In Johnson v. Norfolk Southern Railway3195 a railroad employee brought a claim pro se in a state court alleging that Norfolk Southern had committed a breach of the CBA. After Norfolk Southern removed the case to a Maryland federal district court, the company argued that the RLA preempted the employeeâs state law claims.3196 The court agreed and held that the claim required an interpretation or application of a CBA and thus qualified as a minor dispute under the RLA.3197 Therefore, the RLAâs mechanism for the resolution of minor disputes preempts a claim 3189 Id. at *1-2. 3190 Id. at *2. 3191 Id. at *9-10. 3192 Id. at *2. 3193 Id at *15-17. 3194 Id. at *18. 3195 2011 U.S. Dist. LEXIS 22225, at *1 (D. Md. 2011). 3196 Id. at *2. 3197 Id. at *4-5.
619 under state law, thus preventing a federal district court from deciding the issue.3198 The court lacked jurisdiction because the claim had to be referred to arbitration.3199 7. Requirement that the NRAB Exercise its Jurisdiction In Union Pacific Railroad Co. v. Brotherhood of the Locomotive Engineers & Trainmen General Committee of Adjustment3200 the Supreme Court reviewed the decision of an NRAB panel in which the panel dismissed an arbitration petition for lack of jurisdiction because the railroad did not submit proof of pre-arbitration âconferencingâ as required by the RLA. The case concerned a dispute between Union Pacific and its employees after Union Pacific charged certain employees with disciplinary violations.3201 At the request of a panel, Union Pacific submitted evidence of the conferencing, but the panel refused to examine the evidence. The panel stated that it was âan appellate tribunal, as opposed to one which is empowered to consider and rule on de novo evidence and arguments.â3202 After the panel dismissed the case for lack of jurisdiction and Union Pacific appealed, a federal district court upheld the panelâs decision.3203 However, on appeal, the Seventh Circuit held that the panelâs decision not to view the evidence violated Union Pacificâs rights of due process and overturned the decision.3204 3198 Id. 3199 Id. at *3, *6. 3200 558 U.S. 67, 130 S. Ct. 584, 175 L. Ed.2d 428 (2009). 3201 Id., 558 U.S. at 76, 130 S. Ct. at 593, 175 L. Ed.2d at 440. 3202 Id., 558 U.S. at 77, 130 S. Ct. at 594, 175 L. Ed.2d at 441. 3203 Id., 558 U.S. at 77-78, 130 S. Ct. at 594, 175 L. Ed.2d at 441. 3204 Id., 558 U.S. at 78-79, 130 S. Ct. at 595, 175 L. Ed.2d at 441-442.
620 The Supreme Court affirmed the Seventh Circuitâs decision but for a different reason.3205 The Court held that the panelâs decision should have been overturned on statutory, not constitutional, grounds.3206 Although Congress granted the NRAB the power to make rules and processes for claims presented to it, the NRAB was not authorized to refuse to exercise its jurisdiction, i.e., the âjurisdiction to adjudicate grievances of railroad employees that remain unsettled after pursuit of internal procedures.â3207 The Court held that by refusing to hear the claim on jurisdictional grounds the panel âfailed âto conform, or confine itself, to matters [that Congress placed] within the scope of [the NRABâs] jurisdiction.ââ3208 The NRABâs authority to adjudicate is not conditioned on the partiesâ attempts to resolve disputes in conference as required by the RLA; thus, the requirement for conferencing is not âjurisdictional.â3209 Moreover, the Court held that the RLA does not require the production of evidence of conferencing before the NRAB may exercise its jurisdiction of a dispute.3210 8. Judicial Power to Enjoin a Strike to Compel Compliance with the RLA A recent case decided by the Ninth Circuit that involved a strike by employees and a later injunction against the strike is Aircraft Service International, Inc. v. International Brotherhood of Teamsters AFL-CIO, Local 117.3211 The issue was whether a company providing aircraft 3205 Id., 558 U.S. at 80, 130 S. Ct. at 595-596, 175 L. Ed.2d at 442-443. 3206 Id. 3207 Id., 558 U.S. at 71, 130 S. Ct. at 590, 175 L. Ed.2d at 437. 3208 Id., 558 U.S. at 80, 130 S. Ct. at 596, 175 L. Ed.2d at 443. 3209 Id., 558 U.S. at 83, 130 S. Ct. at 597, 175 L. Ed.2d at 444. 3210 Id., 558 U.S. at 85-86, 130 S. Ct. at 598-599, 175 L. Ed.2d at 446. 3211 742 F.3d 1110 (9th Cir. 2014).
621 services qualified as a âcarrierâ under the RLA.3212 Although the case does not involve railroad employees, the principles apply to all employees covered by the RLA. The workers planned a strike because of an employeeâs suspension that the employees considered to be unfair.3213 Aircraft Service International sought an injunction to prevent the strike.3214 After a district court granted a temporary restraining order and later a preliminary injunction the union appealed to the Ninth Circuit.3215 The union argued that the federal district court did not have jurisdiction under the Norris-LaGuardia Act and, alternatively, that the injunction violated the employeesâ First Amendment rights.3216 The Ninth Circuit held that the district court had jurisdiction because the Norris- LaGuardia Act, which âwithdraws jurisdiction from federal courts to enjoin strikes âgrowing out of any labor disputes,ââ does not prevent federal courts from issuing an injunction to compel the parties to comply with the requirements of the RLA.3217 The Ninth Circuit observed that the employees were unwilling to bargain and planned to strike, one of the very reasons that Congress enacted the RLA because âcarrier employees collectively threatening a strike [are] capable of single-handedly interrupting interstate commerce by shutting down an airport.â3218 Furthermore, 3212 Id. at 1112. 3213 Id. 3214 Id. at 1113. 3215 Id. 3216 Id. 3217 Id. at 1114 (citation omitted). 3218 Id. at 1120.
622 the injunction did not violate the employeesâ First Amendment rights. The court had held previously that the requirements of the RLA are ââenforceable by whatever appropriate means might be developed on a case-by-case basis,â including strike injunctions.â3219 Affirming the district courtâs decision, the Ninth Circuit held that the district court properly balanced the equities and did not abuse its discretion in ruling that the balance of the equities favored American Service International.3220 Articles 9. Overview of the RLA and Other Labor Relations Laws A report by the Congressional Research Service (CRS) provides an overview of three major labor relations laws, including the RLA, provides a brief history of each law, and discusses how each statute operates and is administered.3221 The report summarizes the RLA as a labor dispute resolution system that emphasizes mediation and arbitration.3222 The report discusses the rights and duties of parties that are subject to the law and the multiple entities that are responsible for the administration and enforcement of dispute resolution.3223 The report discusses other major labor laws, including the National Labor Relations Act (NLRA) and the Federal Service Labor-Management Relations Statute (FMSLMRS). The report notes the 3219 Id. at 1122 (citation omitted). 3220 Id. at 1123. 3221 Hegji, supra note 3143 (summarizing three major labor relations statutes: the Railway Labor Act (RLA), the National Labor Relations Act (NLRA), and the Federal Service Labor-Management Relations Statute (FSLMRS)). 3222 Hegji, supra note 3143, at 1-5. 3223 Id. at 6-14.
623 differences among the three major labor relations laws, for example, explaining that â[u]nlike the RLA and NLRA, the FSLMRS does not have any emergency dispute resolution provisions.â3224 10. Whether the RLA Completely Preempts Claims under State Law An article in the Transportation Law Journal examines the principles and the application of the doctrine of federal preemption, particularly in regard to the RLA.3225 The article summarizes how courts historically have relied on preemption by the RLA and discusses the current split among the federal circuits on whether the RLA completely preempts claims under state law.3226 However, the article concludes that a decision by the Supreme Court in Beneficial National Bank v. Anderson3227 means that the RLA should preempt claims under state law completely that involve disputes over labor agreements.3228 11. Contractual Due Process and Regulations on Certification of Locomotive Engineers Another article in the Transportation Law Journal examines the federal governmentâs certification program for locomotive engineers.3229 The article explains that the FRA made the appellate provisions regarding certification completely separate from those governing disputes 3224 Id. at 42. 3225 Kelly Collins Woodford, Harry A. Rissetto, & Thomas J. Woodford, âComplete Preemption under the Railway Labor Act: Protecting Congressionally Created Grievance Arbitration Procedures,â 36 Transp. L. J. 261 (2009), hereinafter referred to as âWoodford, Rissetto, & Woodford.â 3226 Id. at 268, 288-297. 3227 539 U.S. 1, 123 S. Ct. 2058, 156 L. Ed.2d 1 (2003). 3228 Woodford, Rissetto, & Woodford, supra note 3225, at 269, 297-98. 3229 John LaRocco and Richard Radek, âThe Dilemma of Locomotive Engineer Certification Regulations Vis-Ã -vis Contractual Due Process in Discipline Cases,â 40 Transp. L. J. 81 (2013).
624 over collective bargaining agreements that are covered by the RLA.3230 Under the current framework a railroad has a duty to monitor engineersâ performance; if an engineer violates a rule or is involved in an incident, the railroad conducts a hearing to determine whether the engineerâs certification (also known as a license) should be revoked.3231 A decision may be appealed to the FRA Administrator and later to the Locomotive Engineer Review Board.3232 At the same time, a railroad may institute disciplinary proceedings against an engineer under the CBA that triggers the RLAâs dispute resolution mechanism.3233 An arbitrator is required to make a decision in harmony with the FRA Administratorâs decision when the FRA already has made a determination.3234 The article explains that there is a dilemma: On organized railroads, an appeal of the disciplinary penalty may be, and usually is, instituted by the Union pursuant to the CBA. With respect to the individualâs certification revocation, an appeal must be made to the FRA within 180 days of the railroadâs decision to revoke. For both appeals, the record produced at the company-level hearing comprises the appellate record. Thus, the same incident, and the same record, which led to both the disciplinary and revocation decisions, is appealed to two distinct tribunals. The disciplinary appeal, after grievance handling, ends up in arbitration pursuant to the Railway Labor Act, as amended (RLA). The revocation decision is appealed to the Locomotive Engineer Review Board (LERB). It is at this point a dilemma takes root.3235 3230 Id. at 83-84. 3231 Id. at 83. 3232 Id. at 84. 3233 Id. at 83-84. 3234 Id. at 86. 3235 Id. at 83-84 (footnotes omitted).
625 The article states that separate decisions, which could be contradictory, are made based on the same events and records.3236 To remedy the problem the article suggests that a RLA arbitrator should be allowed to make determinations both on the revocation of an engineerâs certification and on the disciplinary matter.3237 C. The Labor Management Relations Act Statutes 1. Suits By and Against Labor Organizations Section 301 of the LMRA, codified in 29 U.S.C. § 185, âprotects the rights of management and organized labor and establishes a comprehensive scheme of dispute resolution.â3238 Congress enacted the LMRA in 1947 to expand the jurisdiction of federal courts on issues arising under the RLA so as to include suits brought by or against labor organizations.3239 The Act provides for federal jurisdiction over âsuits for violation of contracts between an employer and a labor organization representing employees in an industry affecting commerce.â3240 The Act also provides that an employer and the union are bound by the acts of their agents.3241 Section 301 is an exception to the general rule of the NLRBâs exclusive 3236 Id. at 89. 3237 Id. at 89-90. 3238 Christopher L. Sagers, âDue Process Review under the Railway Labor Act,â 94 Mich. L. Rev. 466, 466 (1995). 3239 O. S. Hoebreckx, âThe Federal Courts under Section 301,â 43 Marquette L. R. 417 (1960), hereinafter referred to as âHoebreckx.â 3240 29 U.S.C. § 185(a) (2014). 3241 29 U.S.C. § 185(b) (2014).
626 jurisdiction. Section 301 creates a practical method for enforcing labor contracts in federal courts that also enables plaintiffs to recover money damages from labor organizations.3242 Cases 2. Hybrid Actions for Alleged Misconduct of the Employer and the Union A unique action that may be brought under § 301 of the LMRA and the RLA is a hybrid action. In a hybrid action an employee alleges intertwined misconduct of the employer and the union. Such an action is a hybrid ⧠301 and breach of duty [suit],â brought by an employee against both his employer and his union in order to set aside a âfinal and bindingâ determination of a grievance, arrived at through the collectively bargained method of resolving the grievance. It is, therefore, a direct challenge to âthe private settlement of disputes under [the collective-bargaining agreement].â Moreover, ⦠the respondent employee here has two claims, each with its own discrete jurisdictional base. The contract claim against the employer is based on § 301, but the duty of fair representation is derived from the NLRA. Yet the two claims are inextricably interdependent. âTo prevail against either the company or the Union, ⦠[employee-plaintiffs] must not only show that their discharge was contrary to the contract but must also carry the burden of demonstrating breach of duty by the Union.â Accordingly, a plaintiff must prevail upon his unfair representation claim before he may even litigate the merits of his § 301 claim against the employer.3243 Thus, a hybrid action contains two causes of action, one against the employer for breach of the collective bargaining agreement, and one against the union for breach of its duty of fair representation. A recent example of a hybrid action against a railroad company and a labor organization is Abramowich v. CSX Transportation, Inc.3244 decided by a Pennsylvania federal district court. 3242 Hoebreckx, supra note 3225, at 417. 3243 UPS, 451 U.S. at 66-67, 101 S. Ct. at 1565-1566, 67 L. Ed.2d at 742-743 (citations omitted) (emphasis supplied). 3244 2013 U.S. Dist. LEXIS 138150, at *1 (W.D. Penn. 2013).
627 In Abramowich, employees of CSX believed that CSX was paying them a rate lower than that specified in their agreement and was withholding back pay in violation of the CBA.3245 The Brotherhood of Locomotive Engineers and Trainmen (BLET) reached a settlement with CSX over the issues of the rate of pay and back pay; however, the employees were not convinced that the settlement provided them with their full back pay but were convinced that they had forfeited their rights to dispute the amount.3246 The employeesâ hybrid claim against CSX and BLET argued that CSX violated the RLA by committing a breach of the CBA and that BLET violated its duty of fair representation in its settlement of the employeesâ claim for back pay.3247 In hybrid actions a plaintiff must succeed on both claims to prevail; if the claim against the union fails then the claim against the employer will not proceed.3248 The court first approached the issue of whether BLET had committed a breach of its duty of fair representation.3249 The court held that although âa union has the duty to represent all members of the bargaining unit fairlyâ labor organizations also have some discretion because they âmust attempt to satisfy the collective needs of a group of employees.â3250 A plaintiff must prove that a labor organizationâs actions were âarbitrary, 3245 Id. at *3. 3246 Id. at *14-17. The employeesâ belief was based apparently on BLETâs suggestion that the employees not seek an arbitration of the dispute. 3247 Id. at *3, 17. 3248 Id. at *23-24. 3249 Id. at *24. 3250 Id. at *21.
628 discriminatory, or made in bad faith.â3251 Negligence or poor judgment is insufficient to succeed on a claim of breach of fair representation.3252 The court held that because of the risks inherent in arbitration BLET had logical reasons for settling with CSX for less than the full amount.3253 The court held that the employees presented no evidence that BLETâs advice not to seek arbitration was made arbitrarily, discriminatorily, or in bad faith.3254 Furthermore, the court held that âcontrary to Plaintiffsâ arguments, the record is replete with evidence that the union avidly pursued a reasonable resolution of the Plaintiffsâ claims against CSX in a rational and fair manner favorable to the Plaintiffs.â3255 Finally, the court considered BLETâs conduct in entering into the settlement agreement with CSX (but not the terms of the settlement) to determine whether BLET had violated its duty of fair representation. The court held that the union had not.3256 Because the action was a hybrid action and the employees had failed to show that BLET violated its duty of fair representation, the court did not proceed to the merits of the case against CSX for a violation of the RLA.3257 The court granted the defendantsâ motion for a summary judgment.3258 3251 Id. at *21-22. 3252 Id. at *23. 3253 Id. at *29-30. 3254 Id. at *35. 3255 Id. 3256 Id. at *38-39. 3257 Id. at *40-41. 3258 Id. at *41.
629 3. Six-Month Statute of Limitations Applies to Hybrid Actions Congress did not include a statute of limitations in the FMRA on a claim by a union for a breach of fair representation, an issue that the Supreme Court addressed in 19833259 and 1987.3260 In 1983, the Court held that the six-month statute of limitations in the NLRA applied to hybrid actions and to actions for breach of fair representation under the LMRA.3261 The NLRA is similar to the RLA and covers workers in a wide variety of industries but not those already covered by the RLA.3262 In West v. Conrail3263 a railroad employee brought a hybrid action under the RLA and FMRA against his employer and union, a case that the Supreme Court decided in 1987. The employee filed the claim within the six-month period but failed to complete service of process within six months.3264 Citing its 1983 decision holding that a six- month statute of limitations applied to all FMRA claims for breach of the duty of fair representation, even though the case involved claims based on the RLA, not the NLRA, the held that a six-month statute of limitations applied to the West case as well.3265 The Court also held that in its 1983 decision only the statute of limitations was borrowed from the NLRA, not the 3259 DelCostello v. Intâl Bhd. of Teamsters, 462 U.S. 151, 155, 103 S. Ct. 2281, 2285, 76 L. Ed.2d 476, 483 (1983). 3260 West v. Conrail, 481 U.S. 35, 107 S. Ct. 1538, 95 L. Ed.2d 32 (1987). 3261 DelCostello, 462 U.S. at 155, 103 S. Ct. 2285, 76 L. Ed.2d at 483. See Barbara J. Van Arsdale, âWhen Does Six-Month Limitations Period, Applicable to Employeeâs âHybridâ Action against Employer and Union under § 301 of Labor Management Relations Act of 1947 Begin to Run,â 194 A.L.R. Fed. 1. 3262 Hegji, supra note 3143, at 17. 3263 West, 481 U.S. at 36, 107 S. Ct. at 1540, 95 L. Ed.2d at 35. 3264 Id., 481 U.S. at 37, 107 S. Ct. at 1540, 95 L. Ed.2d at 36. 3265 Id., 481 U.S. at 38-40, 107 S. Ct. at 1540, 95 L. Ed.2d at 36.
630 NLRAâs procedures.3266 The Court remanded the case because the service of process complied with the Federal Rules of Civil Procedure.3267 D. Protective Labor Arrangements for Employees of Transit Agencies Receiving Federal Funding Statutes 1. Section 13(c) Certain provisions of the federal labor laws apply to any activity a private party performs under contract for a transit agency when the costs will be reimbursed by federal funds.3268 One objective is to protect current employees from reductions in personnel.3269 If the affected employees are union members âthe bargaining process ... normally governs employee rights for continued employment as well as for seniority recognition, accrued benefits disposition, pay and other benefit issues....â3270 When federal funding is involved, 49 U.S.C. § 5333(b), (still referred to as § 13(c)), requires that public transportation agencies protect existing labor agreements, i.e., by the use of âprotective arrangementsâ that must be certified by the Department of Labor and that must be in 3266 Id., 481 U.S. at 38, 107 S. Ct. at 1541, 95 L. Ed.2d at 37. 3267 Id., 481 U.S. at 40, 107 S. Ct. at 1542, 95 L. Ed.2d at 38. 3268 Federal Transit Administration, âReport to Congress on the Costs, Benefits, and Efficiencies of Public-Private Partnerships for Fixed Guideway Capital Projects,â at 41, available at: http://www.fta.dot.gov/documents/Costs_Benefits_Efficiencies_of_Public-Private_Partnerships.pdf (last accessed March 31, 2015), hereinafter referred to as âFTA Report to Congress on PPPs.â 3269 Chasity H. OâSteen and John R. Jenkins, âLocal Government Law Symposium: Article: We Built It, and They Came! Now What? Public-Private Partnerships in the Replacement Era,â 41 Stetson L. Rev. 249, 294 (2012). 3270 Id.
631 effect before FTA funds may be released to a mass transit provider.3271 Thus, when § 13(c) applies, transit agencies must protect employeesâ rights to collective bargaining; preserve their rights, privileges, and benefits under existing collective bargaining agreements; maintain paid training or retraining programs; assure employees of continued employment and priority of reemployment in the event of lay-offs; and protect employees âagainst a worsening of their positions related to employment.â3272 Case 2. Applicability of Section 13(c) to a Transit Employee On Loan to Another Agency In recent years apparently only a few cases have been decided involving § 13(c).3273 In Mancuso v. City of Durham3274 the city of Durham entered into an agreement in June 2010 with Triangle Transit Authority (TTA) that provided for TTA to assume the management and operation of the Durham Area Transit Authority. Mancuso was employed by the city of Durham as a transit administrator from March 1997 to October 2011. He remained an employee of the city but was âon loanâ to TTA from October 1, 2010 to September 30, 2011. Mancuso 3271 49 U.S.C. § 5333(b) (2014); see United States Department of Labor, Office of Labor-Management Standards, available at: http://www.dol.gov/olms/regs/compliance/QandA.htm (last accessed March 31, 2015). 3272 FTA Report to Congress on PPPs, supra note 3268, at 40. 3273 See City of Colo. Springs v. Solis, 589 F.3d 1121 (10 Cir. 2009); City of Colo. Springs v. Chao, 587 F. Supp.2d 1185 (10th Cir. 2008) (referring to purchase of two buses to be used in the operation of Colorado Springsâs Mountain Metropolitan Transit service); Mancuso v. City of Durham, 741 S.E.2d 926 (N.C. App. 2013); DART v. Amalgamated Transit Union Local No. 1338, 273 S.W.3d 659 (Tex. 2008); Utah Transit Auth. v. Local 382 of the Amalgamated Transit Union, 2012 UT 75, 289 P.3d 582 (2012); Mid- Ohio Valley Transit Auth. v. Amalgamated Transit Union Local 1742, 2013 W. Va. LEXIS 513, at *1 (W.Va. 2013). 3274 2013 N.C. App. LEXIS 427, at *1 (N.C. App. 2013).
632 complained that his § 13(c) rights were violated âwhen he was placed in a temporary position with duties that were not comparable to the duties of his prior position.â3275 The court remanded the matter to the trial court for findings on whether the parties were bound by an arbitration clause in the union contract with the city of Durham. If the trial court holds that there is an enforceable agreement to arbitrate, the trial court must determine whether the plaintiffâs claim comes within the âsubstantive scopeâ of the agreement.3276 If so, an arbitrator will decide the merits of the plaintiffâs complaint, not the court.3277 Cases E. Employees and Application of the First and Fourth Amendments to Transit Authorities 1. Transit Authority did not Violate Employeeâs Freedom of Speech In Anemone v. Metro. Transp. Authority3278 an employee of the Metropolitan Transportation Authority (MTA) alleged that the MTA violated his right of free speech under the federal and New York constitutions.3279 Anemone was hired as the Director of Security and the Deputy Executive Director of the MTA and Casale was hired as the MTAâs Deputy Director of Security.3280 As part of their jobs, Anemone and Casale investigated allegations of corruption at the MTA.3281 As a result of an investigation Anemone learned that multiple MTA contractors 3275 Id. at *2. 3276 Id. at *7. 3277 Id. 3278 629 F.3d 97 (2d Cir. 2011). 3279 Id. at 99. 3280 Id. at 100.
633 were submitting fraudulent bills for their work, a matter that Anemone referred to the Manhattan District Attorneyâs office.3282 Anemone also opened an investigation of the president of the Long Island Railroad (LIRR) to determine whether he had received improper gifts from Plasser American.3283 An Interim Report, however, issued by the Office of the Inspector General (OIG) stated that Anemone and Casale fabricated the existence of a confidential informant and behaved in a manner that was unacceptable for high ranking members of the MTA.3284 As a result of the report, MTA placed Anemone and Casale on administrative leave.3285 MTA later terminated Anemoneâs employment.3286 The OIGâs final report found that Bauer had in fact engaged in ethics violations and, therefore, Anemone and Casale were entitled to have their names cleared.3287 Anemone filed suit against the MTA for taking âa number of adverse employment actions in retaliation for First Amendment-protected activity exposing corruption at the MTAâ¦.â3288 A federal district court had granted the MTAâs motion for a summary judgment because âno reasonable jury could find that [Anemone was terminated] out of a desire to punish him for 3281 Id. 3282 Id. 3283 Id. at 101. 3284 Id. at 102, 109-110. 3285 Id. 3286 Id. at 111. 3287 Id. 3288 Id. at 112.
634 his allegedly protected expressive activity.â3289 Second, the district court held that âa reasonable jury could not help but find that Anemone would have suffered the alleged adverse employment actions even in the absence of his allegedly protected activity.â3290 Third, instances cited by Anemone as âprotected activity ... were in fact unprotected employee speech....â3291 The Second Circuit affirmed the district courtâs decision.3292 2. Transit Authorityâs Alleged Violation of the Rights of Free Speech and the Exercise of Religion In Lewis v. New York City Transit Authority3293 Lewis brought an action as the administrator of his wifeâs estate in which he alleged that his wife, a bus driver for the New York City Transit Authority (Transit Authority), was discriminated against because as a Muslim she refused to remove her head scarf.3294 When Lewis left on medical leave, the Transit Authority instituted a new dress code that only authorized employees to wear depot caps and uniform hats with logos.3295 Upon returning to work, Lewis refused to remove her headscarf or wear a uniform cap over her headscarf.3296 Because of her refusal, Lewis was transferred to a position in a bus 3289 Id. at 113. 3290 Id. 3291 Id. 3292 Id. at 121. 3293 2014 U.S. Dist. LEXIS 46471, at *1 (E.D. N.Y. 2014). 3294 Id. at *1-2. 3295 Id. at *6-8. 3296 Id. at *8-9.
635 depot where the headgear policy did not apply.3297 A few months later a new policy allowed employees to wear turbans and headscarves with the Transit Authority logo.3298 Lewis was reassigned to a position as a station agent but was terminated because she did not wear the logo as required by the new policy.3299 After she was transferred to a position as a bus driver, the Transit Authority ultimately terminated her position; however, for medical reasons she could not perform the duties of a bus driver.3300 The suit against the Transit Authority claimed that the authority retaliated against Lewis for exercising her right to the free exercise of religion and her right of free speech.3301 A New York federal district court stated that when ââthe government seeks to enforce a law that is neutral and of general applicability ... it need only demonstrate a rational basis for its enforcement, even if enforcement of the law incidentally burdens religious practices.ââ3302 The court held that the Transit Authorityâs policies were not facially neutral because after Lewis was transferred, the Transit Authority published a series of bulletins that indicated that the Transit Authority was targeting women who wore headscarves.3303 The court held that the transfer of female Muslim employees to the bus depot was not an action that was tailored to achieve the 3297 Id. 3298 Id. at *14. 3299 Id. at *17. 3300 Id. at *17, 18. 3301 Id. at *82-83. 3302 Id. at *84-85 (quoting Fifth Ave. Presbyterian Church v. City of New York, 293 F.3d 570, 574 (2d Cir. 2002)). 3303 Id. at *91-92.
636 Transit Authorityâs goal of having a uniform workforce.3304 Because there was a genuine issue of material fact regarding whether the Transit Authorityâs policies violated Lewisâs right to the free exercise of religion, the court denied the Transit Authorityâs motion for a summary judgment.3305 The plaintiff alleged that the Transit Authority also discriminated against Lewis for exercising her right of free speech when she spoke to the media on the policies regulating headgear.3306 Because the Transit Authority did not demonstrate that in the absence of her statements to the media it would have transferred Lewis multiples times and then terminated her, the district court denied the Transit Authorityâs motion for a summary judgment.3307 The court also denied the Transit Authorityâs motion for a summary judgment on the plaintiffâs claims for âdisparate treatment, failure to accommodate, disparate impact and retaliation,â as well as other claims.3308 3. Regulations Requiring Rail Employees to Undergo Observed Drug Testing do not Violate the Fourth Amendment In BNSF Ry. Co. v. United States DOT3309 BNSF along with other petitioners challenged a Department of Transportation (DOT) regulation that required rail employees who fail or refuse to take a drug test to enroll in a drug treatment program and pass urine tests for jobs with a safety 3304 Id. at *92-93. 3305 Id. at *93. 3306 Id. at *95. 3307 Id. at *96-97. 3308 Id. at *24. 3309 566 F.3d 200 (D.C. Cir. 2009).
637 component.3310 BNSF argued that the regulation violated the Administrative Procedure Act (APA) and the Fourth Amendmentâs protection against unreasonable searches.3311 The DOT may promulgate regulations under the Omnibus Transportation Employee Testing Act of 1991 that requires drug tests for transportation employees.3312 In 2008, a new DOT regulation required all return-to-duty and follow-up tests to use a âdirect observationâ method that entailed a same-gender observer to watch the collection of the urine sample to ensure that an employee was not cheating.3313 The Supreme Court has held that compulsory urine tests are searches under the Fourth Amendment and that drug tests for transportation safety do not require warrants.3314 The District of Columbia Circuit held that the DOT regulations did not violate the Fourth Amendment âgiven the vital importance of transportation safety, the employeesâ participation in a pervasively regulated industry, their prior violations of the drug regulations, and the ease of obtaining cheating devices capable of defeating standard testing procedures.â3315 The court also held that the DOT did not violate the APAâs prohibition on arbitrary and capricious action when promulgating the regulations.3316 The DOT was justified in promulgating regulations that were more strict on drug testing after it 3310 Id. at 202. 3311 Id. 3312 Id. (citing 49 C.F.R. Part 40)(2014)). 3313 Id. (citing 49 C.F.R. § 40.67(i) (2014)). 3314 Id. at 206 (citing See Skinner v. Ry. Labor Executives Assân, 489 U.S. 602, 617, 109 S. Ct. 1402, 103 L. Ed.2d 639 (1989)). 3315 Id. at 208. 3316 Id. at 203.
638 concluded âthat the growth of an industry devoted to circumventing drug tests, coupled with returning employeesâ higher rate of drug use and heightened motivation to cheat, presented an elevated risk of cheating on return-to-duty and follow-up tests that justified the use of mandatory use of direct observation.â3317 3317 Id. at 205.
639 XXVIII. NEGLIGENCE AND RAILROAD LIABILITY A. Introduction This part of the Report discusses statutes, cases, and articles on tort law as it applies to railroads. Section B discusses the attractive nuisance doctrine as it has been applied to railroads. Section C discusses various issues that have arisen in collisions between motor vehicles and trains, including at highway-railroad crossings, such as whether the doctrine of negligence per se may be applied to railroads, whether the Federal Railroad Safety Act (FRSA) and the Locomotive Inspection Act (LIA) preempt negligence claims brought under the Federal Employersâ Liability Act (FELA), whether the FRSA preempts state laws that apply to railroad crossings, and whether the doctrine of respondeat superior applies to railroads. Section D addresses the issue of contributory negligence and whether a railroad may be held liable when a motorist was intoxicated at the time of the accident, as well as other instances when a railroad company may not be liable because of a cyclistâs, motoristâs, or pedestrianâs contributory negligence. Section D also discusses articles on the standing train doctrine and other state laws that may apply to accidents and the presumption of contributory negligence in cases involving occupied crossings. Section E discusses cases involving contributory negligence and individuals who are deaf. Section F addresses statutes or rules that require motorists to stop, look, and listen. Section G deals with statutes and cases specifically involving accidents because of crossing gates, including issues related to inspections and allegedly defective gates at crossings. Section H covers cases involving falling objects and when, for example, the doctrine of res ipsa loquitor applies. Section I analyzes the last clear chance doctrine and its applicability to railroad cases. Section J discusses cases and articles on the issue of whether and when
640 evidence is admissible to prove a railroad companyâs knowledge or notice of a dangerous condition of its property. Cases B. Whether the Attractive Nuisance Doctrine Applies to Railroads 1. Definition of an Attractive Nuisance In general, an owner of land owes no duty to a trespasser on his or her land; however, there is an exception. A landowner owes a duty of reasonable care to children who are trespassers to protect them from a dangerous condition when: (1) the landowner knew or should have known that children habitually frequent the property; (2) a defective structure or dangerous condition was present on the property; (3) the defective structure or dangerous condition was likely to injure children because they are incapable, based on age and maturity, of appreciating the risk involved; and (4) the expense and inconvenience of remedying the defective structure or dangerous condition was slight when compared to the risk to children.3318 As for the meaning of the term child within the meaning of the attractive nuisance doctrine, a comment to the Restatement (Second) of Torts states that in attractive nuisance cases the plaintiff is often younger than twelve years of age. Although older cases usually involved children between the ages of six and twelve, in more recent cases the courts have recognized that children may be as old as seventeen. The Restatement states that attractive nuisance claims are ânot limited to âyoungâ children, or to those âof tender years,â so long as the child is still too 3318 Choate v. Indiana Harbor Belt R.R. Co., 366 Ill. Dec. 258, 265, 980 N.E.2d 58, 65 (Ill. 2012).
641 young to appreciate the danger.â3319 Although most courts have not set an age limit, some courts have held that after the age of fourteen the rule is no longer applicable.3320 2. Obvious Trains Held not to be an Attractive Nuisance In Choate v. Indiana Harbor Belt R.R. Co.3321 a twelve-year old boy attempted to jump on a moving train to impress his friends but ended up severing part of his left foot. The Supreme Court of Illinois held that the plaintiff failed to prove two elements of the attractive nuisance doctrine quoted above: that the alleged defective structure or dangerous condition was likely to injure children on the basis that children are incapable of appreciating the risk presented, and that the expense and inconvenience of remedying the defective structure or dangerous condition was slight when compared to the risk that the condition presented to children. The test for determining the existence of an attractive nuisance is an objective one: whether a landowner reasonably expects a child to understand the risk, not whether a child actually understands the risk.3322 In Choate, the court held that the risk of jumping onto a moving train is an open and obvious risk to a twelve-year old child.3323 As for the element of expense and inconvenience, because a court must compare the risk of injury with the expense and inconvenience of 3319 Restatement (Second) of Torts, § 339, cmt. c. (1979 and later supplements). 3320 See Moseley v. Kansas City, 170 Kan. 585, 228 P.2d 699 (1951); Cates v. Beauregard Electric Cooperative, Inc., 316 So.2d 907 (La. App. 1975); Jones v. Maryland Casualty Co., 256 So.2d 358 (La. App. 1971); Lipscomb v. Cincinnati, N. & C. St. R. Co., 239 Ky. 587, 39 S.W.2d 991 (1931); State use of Potter v. Longeley, 161 Md. 563, 158 A. 6 (1932); Keck v. Woodring, 201 Ok. 665, 208 P.2d 1133 (1948); Sidwell v. McVay, 282 P.2d 756 (Ok. 1955); Hanson v. Freigang, 55 Wash.2d 70, 345 P.2d 1109 (1959); and Schulte v. Willow River Power Co., 234 Wis. 188, 290 N.W. 629 (1940). 3321 366 Ill. Dec. 258, 980 N.E.2d 58 (Ill. 2012). 3322 Id., 366 Ill. Dec. at 268, 980 N.E.2d at 68 (internal citation omitted). 3323 Id., 366 Ill. Dec. at 266, 980 N.E.2d at 67.
642 preventing a potentially dangerous condition, the court held that the railroad did not have a duty to fence its property to prevent injury to children.3324 The imposition of such a duty would require a railroad to erect fences at great expense in all locations where children could trespass.3325 In the Choate case, moreover, although only portions of the railroad corridor were fenced, fencing would not have deterred the plaintiff who ignored the existing segments of fencing and existing warning signs.3326 The court held that âthe responsibility for a childâs safety lies primarily with his parents, whose duty it is to see that the child does not endanger himself.â3327 The Supreme Court of Illinois reversed the ruling of an appellate court and later denied a petition for a rehearing.3328 3. Attractive Nuisance Doctrine Inapplicable to Moving Trains that Injure Children In Woods v. CSX Transp., Inc3329 three boys, aged seven, nine, and ten, who were walking home from school alone for the first time, began to cross a railroad track in the belief that the train had stopped on the tracks.3330 The nine- and ten-year old crossed safely, but the seven-year old child was struck by a CSX train when his shoe became caught on the track.3331 3324 Id., 366 Ill. Dec. at 268, 980 N.E.2d at 68. 3325 Id., 366 Ill. Dec. at 269, 980 N.E.2d at 69. 3326 Id. 3327 Id., 366 Ill. Dec. at 270, 980 N.E.2d at 70 (citation omitted). 3328 Id. 3329 2008 U.S. Dist. LEXIS 97068 at *1, 42-43 (N.D. Ind. 2008). 3330 Id. at *3-4. 3331 Id. at *4.
643 The trainâs engineer, who saw the children in the vicinity of the tracks, sounded the trainâs whistle several times within a forty-three second span but failed to engage the emergency brakes until the boys ran toward the tracks.3332 A federal district court in Indiana held that the attractive nuisance doctrine did not apply when a child is injured or killed by a moving train.3333 In ruling that CSX was entitled to a summary judgment on the plaintiffsâ attractive nuisance claim, the court stated: The overwhelming weight of authority [is that the attractive nuisance doctrine] does not apply as a matter of law in cases where child trespassers are injured by moving trains because a moving train is not a subtle or hidden danger and its potential for causing serious bodily injury or death to anyone in its path is readily apparent, even to young children.3334 The court also held that the FRSA preempted the plaintiffsâ tort claims based on the trainâs speed as a train is not obligated to stop or reduce its speed until a specific, individual hazard is presented.3335 However, the FRSA did not preempt the plaintiffâs claims for CSXâs failure to maintain a lookout or its breach of duty to slow down when a specific hazard is presented, namely the boysâ intent to cross the tracks.3336 Nevertheless, CSX was not liable for negligence. CSX exercised reasonable care because the engineer engaged the emergency brake when he recognized that the boys intended to cross the tracks.3337 In the absence of CSXâs 3332 Id. at *6-7. 3333 Id. at *42-43. 3334 Id. at *43 (citation omitted) (internal quotation marks omitted). 3335 Id. at *22. 3336 Id. at *23. 3337 Id. at *33, 45-6.
644 negligence, the court dismissed the plaintiffsâ remaining claims for negligent infliction of emotional distress and loss of services.3338 C. Motor Vehicle Collisions with Trains Including at Highway-Railroad Grade Crossings 1. Interstate Commerce Commission Termination Actâs Preemption of a Claim for Negligence Per Se In Elam v. Kansas City Southern Ry. Co.3339 the plaintiff Elam, a motorist, was injured when her vehicle struck the side of a Kansas City Southern (KCS) train. Elam alleged that KCS was negligent per se for having violated the stateâs anti-blocking statute.3340 An anti-blocking statute in railroad parlance is a statute that regulates the amount of time a railroad may block a crossing.3341 The Fifth Circuit held that the Interstate Commerce Commission Termination Act (ICCTA) preempted Elamâs for negligence per se but that the ICCTA did not preempt her claim simply for negligence.3342 The ICCTA preempted the claim for negligence per se, because the Act âdoes not permit states to directly regulate âa railroadâs economic decisions such as those pertaining to train length, speed or scheduling.ââ3343 On the other hand, the ICCTA did not preempt the plaintiffâs other claim for negligence because the claim did ânot directly attempt to 3338 Id. at *44-46. 3339 635 F.3d 796 (5th Cir. 2011), motion granted by, remanded by, 2011 U.S. Dist. LEXIS 55564 (N.D. Miss., May 23, 2011) (stating that â[h]aving fully reviewed the record in this case, the Court is of the opinion that the remaining claims are the equivalent of a routine crossing case which is typically resolved in state courtâ), affirmed by, appeal after remand at, appeal dismissed by, in part, 2012 U.S. App. LEXIS 6404 (5th Cir. Miss., Mar. 26, 2012). 3340 Elam, 635 F.3d at 801, 804. 3341 Id. at 801. 3342 Id. 3343 Id. at 806 (citation omitted).
645 manage or govern a railroadâs decisions in the economic realmâ as does a claim for negligence per se.3344 2. Preemption of FELA Claims by the Federal Railroad Safety Act and the Locomotive Inspection Act In Garza v. Norfolk Southern Ry. Co.3345 Garza was injured when an automobile drove through a railroad crossing striking a Norfolk Southern train on which Garza was working. Garza, the trainâs engineer, brought four claims in tort against Norfolk Southern, his employer, under FELA; however, the Sixth Circuit held that the FRSA and the LIA preempted the engineerâs claims.3346 The court also held that Norfolk Southern âcomplied with the posted notifications of the Federal Rail Administration speed limit for the track;â thus, Garza could not show that Norfolk Southern failed to abide by a statutory duty or violated a duty to act with due care.3347 Moreover, Garza was unable to prove that the configuration of his cab seat caused his injuries.3348 Thus, the Sixth Circuit affirmed the grant of a summary judgment on all claims for Norfolk Southern.3349 3344 Id. at 813, 814. 3345 2013 U.S. App. LEXIS 17134, at *1, 3 (6th Cir. 2013). 3346 Id. at *1-2. 3347 Id. at *7. 3348 Id. at *11. 3349 Id. at *11-13.
646 3. FRSAâs Preemption of State Laws on Collisions at Crossings In Driesen v. Iowa, Chi. & E. R. R. Corp.3350 the court held that the FRSA preempted state and city laws regulating railroad safety and therefore granted the defendant Iowa, Chicago & Eastern Railroad Corporationâs (IC&E) motion for a partial summary judgment. When one of the plaintiffs drove the Driesensâ vehicle onto a railroad track the vehicle struck the third railcar of a moving IC&E train.3351 Because the state and local laws at issue regulated a trainâs presence in a crossing, active warning devices, railcar reflectorization, and the use of the locomotiveâs horn, the laws overlapped federal law regulating the same matters. The court held that the FRSA preempted state and local laws regulating the speed of trains, reflectorization of railcars, warning devices, and locomotive horns.3352 The fact that IC&E had not complied with its own safety rules did not prevent federal law from preempting the Driesensâ state claims because the Driesens did ânot cite to any federal regulation mandating these internal rules.â3353 Only the plaintiffsâ claim of IC&Eâs failure to warn of a defective warning device was not dismissed.3354 Because new crossbucks and reflective tape had not been installed at the intersection there could be no âfederal preemptionâ until âthe planned devicesâ were installed and operational.3355 3350 777 F. Supp.2d 1143 (N. D. Iowa 2011). 3351 Id. at 1147. 3352 Id. at 1160. 3353 Id. at 1158. 3354 Id. at 1157. 3355 Id. at 1155 (internal quotation omitted).
647 However, the court also ruled that a jury would decide whether the driverâs contributory negligence was more than fifty percent that would bar his recovery.3356 4. Liability of a Railroad Based on the Doctrine of Respondeat Superior The doctrine of respondeat superior imposes liability âupon an employer for the acts of his employees committed in the course and scope of their employment.â3357 In England v. Cox,3358 in which both the railroad and its employee were defendants, the court applied the doctrine of respondeat superior. The railroad was held liable for the conduct of its employee because the employee was acting within the scope of his employment when he negligently caused his truck to collide with a locomotive by stopping his truck on the tracks.3359 The plaintiff who was riding in the locomotive brought an action against the truck driver, a railroad employee.3360 Kansas law prohibits a vehicle from being driven ââonto any railroad grade crossing unless there is sufficient space on the other side of the ... railroad grade crossing to accommodate the vehicle he or she is operating without obstructing the passage of other vehicles ... or railroad trains notwithstanding any traffic-control signals indication to proceed.ââ3361 The driverâs erroneous belief that there was room on the other side of the crossing to accommodate his truck was insufficient to preclude the truck driver from being held liable. 3356 Id. at 1145. 3357 Ballentineâs Law Dictionary, 3d ed. 3358 2012 U.S. Dist. LEXIS 109364 at *1, 10-11 (D. Kan. 2012), reconsideration denied, 2012 U.S. Dist. LEXIS 123197, at *1 (D. Kan. Aug. 30, 2012). 3359 Id. 3360 Id. at *1. 3361 Id. at *2 (quoting Kan. Stat. Ann. § 8-1584).
648 The truck driver was negligent per se because he violated the Kansas statute; his railroad- employer was held liable under the doctrine of respondeat superior.3362 Furthermore, the FRSA preempted the truck driverâs claim that the crossing signals were defective.3363 The court granted the plaintiffâs motion for a summary judgment.3364 D. Contributory Negligence as a Defense to a Claim against a Railroad 1. Railroad not Liable when a Motorist was Intoxicated In Doyle v. Union Pacific R. Co.3365 the Fifth Circuit held that Union Pacific was not liable for injuries sustained by the plaintiff Doyle when a train and Doyleâs automobile collided because the motorist, who was driving under the influence, did not stop, look, and listen before crossing the tracks. Louisiana law provides that no one shall be liable for injury to an operator of a vehicle âwhen (1) âthe operator is legally intoxicated, (2) the operator is more than twenty- five percent negligent, and (3) his negligence is a contributing factor in the accident.ââ3366 Although there was evidence that the crossing light signals were not working and that the trainâs whistle did not sound prior to the accident, the court affirmed the trial courtâs grant of a summary judgment for Union Pacific.3367 3362 Id. at *5, 10-11. 3363 Id. at *12-14. 3364 Id. at *14. 3365 442 Fed. Appx. 964, 966 (5th Cir. 2011). 3366 Id. at 965 (quoting La. Rev. Stat. Ann. § 9:2798.4)). 3367 Id. at 966.
649 2. Railroad not Liable for the Death of a Person on the Tracks In Owens v. Norfolk Southern Corp.3368 the court held that Norfolk Southern was not responsible for a manâs death when the decedent Owens was lying on the tracks and under the influence of alcohol and illegal substances. The Norfolk Southern crew members had seen an object on the tracks but were unable to determine what the object was until the train was one car length away.3369 On realizing that the object was a person, the crew applied the emergency brakes in an attempt to avoid hitting the decedent.3370 Because the decedent was a trespasser on Norfolk Southernâs property, the court held that Norfolk Southern only owed Owens a duty not to willfully or wantonly injure him and to âexercise ordinary care to avoid injury after it becomes cognizant of the peril.â3371 However, Norfolk Southern had no duty to watch for trespassers.3372 Because the railroad had no knowledge that residents in the area crossed the tracks at the location where the decedent was struck, the railroad did not have constructive knowledge of Owensâs possible presence on the tracks.3373 The decedentâs intoxicated state, illegal drug use, and statements to his medical care providers that he was attempting to commit suicide constituted conclusive evidence that the decedent was the sole proximate cause of the accident.3374 3368 2011 U.S. Dist. LEXIS 62457, at *1, 24 (N. Dist. Ind. 2011). 3369 Id. at *5-6. 3370 Id. at *6. 3371 Id. at *9-10 (citation omitted) (internal quotation marks omitted). 3372 Id. 3373 Id. at *15.
650 3. Child Trespasser Statute Inapplicable to Occupier of Land In Jad v. Boston and Maine Corp.3375 an Amtrak train struck and killed a 15-year old boy when he was crossing the tracks on his way to school. The Appeals Court of Massachusetts held that Boston and Maine Corporation (B&M) was not liable to the plaintiff because under Massachusetts law a railroad is not ââliable for negligence in causing the death of a person ⦠walking or being upon such railroad contrary to lawâ¦.ââ3376 The child trespasser statute assigns liability to a landowner who maintains an artificial condition on his property that causes injury to a trespassing child.3377 However, the court also held that because B&M âwas an occupier rather than the owner of landâ the company was not liable under the child trespasser statute.3378 The plaintiff had argued that the foregoing two statutes were inconsistent and that because the child trespasser statute was more recent it superseded the statute that exempted a railroad operator.3379 The court held that the two statutes were not inconsistent. First, the more general child trespasser statute must yield to the more specific statutory exemption for a railroad operator.3380 Second, the child trespasser statute did not apply because the defendant B&M was an occupier of land, not a landowner.3381 3374 Id. at *21, 24. 3375 26 Mass. App. Ct. 564, 530 N.E.2d 197 (Mass. Ct. App. 1988). 3376 Id., 26 Mass. App. Ct. at 565, 530 N.E.2d at 198 (quoting Mass. Gen. Laws., ch. 229 § 2). 3377 Id., 26 Mass. App. Ct. at 566-567, 530 N.E.2d at 199 (citing Mass. Gen. Laws., ch. 231 § 85Q). 3378 Id., 26 Mass. App. Ct. at 565, 530 N.E.2d at 198. 3379 Id., 26 Mass. App. Ct. at 570, 530 N.E.2d at 201. 3380 Id., 26 Mass. App. Ct. at 579, 530 N.E.2d at 201. 3381 Id., 26 Mass. App. Ct. at 570-571, 530 N.E.2d at 201 (citing Mass. Gen. Laws., ch. 231 § 85Q).
651 Articles 4. Standing Train Doctrine and other State Laws A 2008 law review article entitled âRailroad Lawâ analyzes Virginia law on railroad crossings, the effect of a railroad employeeâs contributory negligence on a claim under FELA, railroad crossings law, and other issues.3382 First, Virginia courts developed the âstanding trainâ doctrine that relieves railroad companies of liability when a motorist crashes into the side of a non-moving train at a crossing.3383 In such cases, the courts have held that only the motorist is negligent. Because the presence of a train on a track constitutes a sufficient warning, a motorist is required to exercise ordinary care to prevent a collision.3384 Second, in regard to railroad crossing law, particularly in Virginia, first, the article explains that there are âtwo distinct groupsâ of crossings â public crossings and private crossings.3385 The author notes that the FRA and the Commonwealth of Virginia regulate public crossings in Virginia.3386 As for public crossings, there are âtwo distinct categories â those with automated warning devices and those with passive warning devices.â3387 The Virginia Code âgoverns the installation of automated warning devisesâ in Virginia.3388 Under the statute, 3382 Brent M. Timberlake, âRailroad Law,â 43 U. Rich. L. Rev. 337 (2008). 3383 Id. 3384 Id. at 368-370. 3385 Id. at 358 3386 Id. (citing 49 C.F.R. §§234.1-234.275 (2007) and Va. Code Ann. §§ 56-355.1 to -369, 56-405 to - 412.2 (Repl. Vol. 2007)). 3387 Id.
652 [a] railroad shall not unilaterally select or determine the type of grade crossing warning system to be installed at any crossing of a public highway and railroad at grade. The railroad shall only install or upgrade a grade crossing warning system at any crossing of a public highway and railroad at grade pursuant to an agreement with the Virginia Department of Transportation or representative of the appropriate public road authority authorized to enter into such agreements.3389 Furthermore, Va. Code Ann. § 56-406.1 provides in part that [w]hen required by the Commonwealth Transportation Commissioner or representative of the appropriate public road authority, every railroad company shall cause a grade crossing warning device including flashing lights approved by the Department of Transportation at such heights as to be easily seen by travelers, and not obstructing travel, to be placed, and maintained at each public highway at or near each place where it is crossed by the railroad at the same level.3390 As for private crossings, a railroad generally owes no duty to licensees.3391 A licensee is âa person who enters upon the property of another for his own convenience, pleasure, or benefit, his presence being tolerated, not invited, by the person in possession.â3392 A ârailroad is âonly liable to a licensee for willful and wanton injury which may be inflicted by the gross negligence of its agents and employeesââ at a private crossing.3393 Third, in some cases passengers have been held to be contributorily negligent for failing to exercise due care for their own safety, thereby completely barring them under Virginia law 3388 Id. at 361 (citing Va. Code Ann. §§ 56-406.1to 406.2) (Repl. Vol. 2007)). 3389 361-362 (citing Va. Code Ann. § 56-406.1 (Repl. Vol. 2007)). 3390 Id. at 363. 3391 Id. at 376. 3392 Ballentineâs Law Dictionary (3d Ed.) (citing Greenfield v. Miller, 173 Wis. 184, 180 N.W. 834 (1921)). 3393 Timberlake, supra note 3382, at 376 (citation omitted).
653 from any recovery for a railroad companyâs alleged negligence.3394 For example, in Norfolk & Western Railway Co. v. Gilliam3395 two estates could not recover damages after their decedents were killed when the vehicle in which they were riding struck a train.3396 Because the passengers had a better opportunity to see the train than the driver of their vehicle, and because they apparently failed to look and listen for an approaching train, the estatesâ claims were barred by the respective passengersâ contributory negligence.3397 5. Presumption of Contributory Negligence in Occupied Crossing Cases Another law review article discusses the âoccupied crossingâ doctrine and contributory negligence.3398 The occupied crossing doctrine presumes that unless a crossing is determined to be ultra-hazardous a plaintiff is contributorily negligent when the plaintiffâs vehicle collides with a train in a railroad crossing.3399 According to the article, â[a]n extra-hazardous crossing is one that obscures the view of the traveling public approaching [the] crossing. This may consist of cuts, embankments, vegetation or other obstacles that obstruct the view of the traveling public in close proximity to the crossing.â3400 A plaintiff alleged to have been contributorily negligent has the burden of proving the existence of an ultra-hazardous crossing to prevent the plaintiffâs own 3394 Id. at 371. 3395 211 Va. 542, 178 S.E.2d 499 (Va. 1971). 3396 See Timberlake, supra note 3382, at 371 (citing Norfolk & Western. R. Co. v. Gilliam, 211 Va. 542, 178 S.E.2d 499 (Va. 1971)). 3397 Id. at 371-372. 3398 Joseph R. Wheeler, âRecent Developments: Torts â the Occupied Crossing Doctrine â Determining Contributory Negligence as a Matter of Law in Railroad Accident Cases,â 53 Tenn. L. Rev. 435 (1986). 3399 Id. at 440. 3400 Id. at 458.
654 negligence from barring the plaintiffâs claim.3401 On the other hand, some courts have not held that a plaintiff is contributorily negligent as a matter of law simply because the plaintiff was familiar with the crossing; rather, the courts permit the jury to decide whether the plaintiff was contributorily negligent.3402 When the issue is to be decided by a jury, a plaintiff should be allowed to submit evidence on the extent to which the train was visible to a motorist, particularly at night.3403 Cases E. Contributory Negligence and Deaf Individuals In Box v. South Georgia Ry. Co.3404 the court held that South Georgia Railway Company (South Georgia) was not liable for hitting and killing Josie Ellis, who was deaf, because she was contributorily negligent by walking on the tracks at the time of the accident. South Georgiaâs crew was entitled to assume that Ellis could see and hear the train and would remove herself from the track.3405 South Georgia had no duty to Ellis until it was clear that Ellis was not leaving the tracks.3406 Furthermore, as Ellis had turned and looked in the direction of the train, it was reasonable for the crew to expect Ellis to leave the tracks.3407 Finally, as soon as the crew 3401 Id. at 470-471. 3402 Id. at 449-454. 3403 Id. 3404 433 F.2d 89 (5th Cir. 1970). 3405 Id. at 92. 3406 Id. 3407 Id. at 93.
655 realized that Ellis was not leaving the tracks the crew took all possible measures to avoid hitting her.3408 Although the court did not hold that walking on the tracks was negligence per se, the court held as a matter of law that âit is negligent for a deaf person to walk on a railroad track without utilizing carefully the remaining sense of sight.â3409 The decedentâs disability did not excuse her negligent conduct.3410 Moreover, the court held that the last clear chance doctrine, discussed below in subpart I, did not âapply to a case where the negligence of the person injured continued up to the very moment of the injury[] and was a contributory and efficient cause thereof.â3411 The decedentâs estate was unable to recover from the railroad. F. Failure to Stop, Look, and Listen as Precluding a Plaintiffâs Claim 1. Railroad not Liable when Plaintiff Fails to Stop, Look, and Listen In Kinchen v. Missouri P. R. Co.3412 the plaintiff Kinchen was injured in a truck and train collision. The plaintiff was contributorily negligent for failing to comply with a Louisiana law that requires a motorist to stop, look, and listen for an approaching train at a railroad crossing. The court also held that the last clear chance doctrine did not excuse the plaintiffâs contributory negligence.3413 The court held that the defendant Missouri Pacific Railroad was not required to have constructed a crossbar or gate at the crossing to increase safety, nor was the company 3408 Id. 3409 Id. 3410 Id. 3411 Id. at 94 (internal citation omitted). 3412 678 F.2d 619 (5th Cir. 1982). 3413 Id. at 624-625.
656 responsible based on the rule of strict liability because there was no evidence that a defect in the train caused the accident.3414 2. Intoxication is not an Excuse for a Failure to Stop, Look, and Listen In Baker v. CSX Transportation3415 the plaintiff Bakerâs intoxication did not excuse his contributory negligence for failing to stop, look, and listen for an oncoming train.3416 When Baker was injured when his truck collided with a CSX train, Baker did not have a valid driverâs license and his blood alcohol level was twice the legal limit in Alabama.3417 Under Alabama law, one has a duty to stop, look, and listen for an approaching train before crossing the tracks.3418 Failure to do so constitutes contributory negligence when âthe plaintiff (1) had knowledge of the dangerous condition; (2) had appreciation of the danger under the surrounding circumstances; and (3) failed to exercise reasonable care by placing himself in the way of danger.â3419 In granting a summary judgment for CSX, a federal district court in Alabama held that Bakerâs conduct met all of the required elements of contributory negligence and that Bakerâs intoxication did not excuse his negligence.3420 3414 Id. at 626-627. 3415 46 F. Supp.2d 1230 (M.D. Ala. 1999). 3416 Id. at 1231-1233. 3417 Id. at 1232. 3418 Id. (citing Ala. Code § 32-5A-150 (1975)). 3419 Id. at 1233 (citing Ridgeway v. CSX Transportation, 723 So.2d 600 (Ala. 1998) (citing Southern Railway v. Randle, 221 Ala. 435, 438, 128 So. 894, 897 (1930))). 3420 Id.
657 G. Liability of a Railroad because of Defective Crossing Gates Statutes and Regulations 1. Inspections of Gates at Railroad Crossings The FRA, which has promulgated regulations on the inspection of gates at railroad crossings, requires that each gate arm and gate mechanism must be inspected at least once each month.3421 The FRA requires that a gate arm movement must be observed for proper operation at least once each month.3422 Cases 2. Railroad not Liable when the Plaintiff Ignored a Non-defective Gate In Hall v. Consolidated Rail Corp.3423 the Supreme Court of Michigan held that Hall failed to provide sufficient evidence that the lights and gates at a crossing were not working at the time of the accident.3424 Pursuant to federal regulations that require railroads to inspect crossings monthly, the defendant Conrail had inspected the railroad crossing the day prior to the accident but failed to find any defect.3425 Three members of the train crew and the engineer operating the train testified that the signals were operating properly.3426 The plaintiffâs evidence was that the lights and gates at the intersection were defective; that they habitually malfunctioned; and that motorists drove around the gates because the gates would be down for 3421 49 C.F. R. § 234.255(a) (2014). 3422 49 C.F.R. § 234.255(b) (2014). 3423 462 Mich. 179, 612 N.W.2d 112 (Mich. 2000). 3424 Id., 462 Mich. at 187, 612 N.W.2d at 115-116. 3425 Id., 462 Mich. at 181, 612 N.W.2d at 113. 3426 Id.
658 extended periods without the lights flashing.3427 Sometimes the gates would lower after cars were on the tracks.3428 In any event, the plaintiff had driven her car around two lowered gates before being struck by the train.3429 The court held that Conrail was not on notice of a defect âbecause Conrail inspected the signal system the day before the accident and found it to be working properly.â3430 3. Liability of a Railroad when Crossing Gates Failed to Lower Prior to the Trainâs Approach In Mills v. Norfolk Southern Ry. Co.3431 the Georgia Court of Appeals held that Norfolk Southern was liable for the death of a driver and for injuries to a passenger when the active warning system at a crossing failed to activate sufficiently in advance to provide the driver with notice that a train was approaching.3432 The plaintiffsâ sons were unable to see the approaching train because of a high fence that blocked their view.3433 The plaintiffs appealed a trial courtâs grant of a new trial to Norfolk Southern in a wrongful death action that arose âwhen the automatic warning devices at the crossing failed to timely activate before the vehicle entered the 3427 Id., 462 Mich. at 183-184, 612 N.W.2d at 114-115. 3428 Id. 3429 Id., 462 Mich. at 182, 612 N.W.2d at 113. 3430 Id., 462 Mich. at 187, 612 N.W.2d at 116. 3431 242 Ga. App. 324, 526 S.E.2d 585 (Ga. Ct. App. 1999). 3432 Id., 242 Ga. App. at 326, 526 S.E.2d at 588. 3433 Id., 242 Ga. App. at 325, 526 S.E.2d at 587.
659 crossing.â3434 The appeals court in this opinion reversed the trial courtâs decision that granted Norfolk Southern a new trial. The appeals courtâs opinion discusses the various federal regulations applicable to crossings at the time of the collision. First, the court stated that â[f]ederal regulations ⦠mandated that all automatic warning devices provide the same minimum standard of configuration and performance for all such automatic warning devices at all crossings so that each performs the same.â3435 Second, â[u]nder federal regulations, the warning lights must flash at least twenty seconds prior to the arrival of the train and the gate must begin to descend at least three seconds after the lights begin to flash and close at least five seconds before the train arrives.â3436 Third, the court stated that [d]espite the federal regulations that an active warning system must activate warning devices 20 seconds before the train enters the crossing and the automatic warnings have 3.5 to 4 seconds of flashing lights and bells, followed by the descent of the gate over the next 20 seconds, this automatic warning system failed to meet such minimum federal standards.3437 The court further stated that under the regulations âthe bells stop, but the gate must be completely down with the lights flashing when the train enters the crossing. When the train exits the crossing, the lights stop flashing immediately and the gates go up.â3438 3434 Id., 242 Ga. App. at 324, 526 S.E.2d at 586. 3435 Id. (citing 49 CFR § 234.1; 2 59 Fed. Reg. 50105). 3436 Id., 242 Ga. App. at 325, 526 S.E.2d at 587 (citing 49 C.F.R. §§ 234.5 (defining activation failure) and citing 234.223 (gate arm) and 234.225 (activation of warning system)). 3437 Id., 242 Ga. App. at 326, 526 S.E.2d at 587 (citing 49 CFR § 234.5; 56 Fed. Reg. 33728). 3438 Id., 242 Ga. App. at 326, 526 S.E.2d at 587-588.
660 Fourth, a ââdelayed activation failureâ occurs when the warning is activated late by the train after it passes the sensor so that the train reaches the crossing before the gates go down and before motorists can receive a proper warning of the approach of the train.â3439 The court explained that â[d]elayed activation failures result from short circuits in the track circuit monitored by warning system control devices; this type of failure is called a âshunt.ââ3440 The court held that âthe facts all fit a delayed activation failure.â3441 The court found that the [m]aintenance records for this crossing kept by signal maintainer Jones showed that between the inspections in December 1987 and January 1988 that a âfalse alarmâ malfunction occurred. Delayed activation failures are first [preceded] by âfalse alarmâ malfunctions. Norfolk Southernâs training and instruction materials stated that a signal maintainer must look for and correct the cause of prior âfalse alarmâ malfunctions, even if they clear up, because the condition may deteriorate into a delayed activation failure. Jones failed to do this before the collision. Thus maintenance did not discover and correct the cause of the delayed activation failures prior to the collision.3442 The court held that âall the prior similar occurrences had sufficient substantial similarity to the activation failure in this case to be relevant and material for admission into evidenceâ¦.â3443 The plaintiffs established a prima facie case at trial because âthere was a delayed activation failure at the time of the train-vehicle collision and a failure to maintain by the railroad, which caused the warning devices at the crossing not to work timely.â3444 3439 Id., 242 Ga. App. at 326, 526 S.E.2d at 588 (citing 49 CFR § 234.5; 56 Fed. Reg. 33728). 3440 Id. 3441 Id. 3442 Id., 242 Ga. App. at 327, 526 S.E.2d at 588 (footnote omitted). 3443 Id., 242 Ga. App. at 324, 526 S.E.2d at 587.
661 After the appeals courtâs decision Norfolk Southern moved for reconsideration; however, the appeals court rejected Norfolk Southernâs argument that the court should not have relied on 49 C.F.R. § 234.225 because the collision occurred in 1988 and the regulation was not adopted until 1994. The court held that âthe substantial equivalent rules and regulations had governed railroad grade crossing signal devices since 1978 as approved by the Federal Highway Administrator as the National Standards for All Highways in unofficially published form and as the basis for such later rules and regulations.â3445 Thus, the plaintiffs established that the railroad was on notice that there was a problem with the activation of the signals and gates at the crossing and that the crew should have used the trainâs horn to warn motorists of the trainâs approach or should have reduced the trainâs speed.3446 4. Railroad not Liable when a Minor is on the Tracks by Avoiding a Safety Gate In Boyd v. Amtrak,3447 supra, XXVIII.G.4, an Amtrak train killed a fifteen-year old girl after she rode her bicycle around a safety gate and into the path of an oncoming train.3448 The Massachusetts wrongful death statute includes an exception that protects railroad operators from 3444 Id. 3445 Id., 242 Ga. App. at 333, 526 S.E.2d at 592 (citing 23 U.S.C. §§ 109(b) and (d); 402 (a); 23 C.F.R. § 1204). 3446 Id., 242 Ga. App. at 327, 526 S.E.2d at 588. 3447 62 Mass. App. Ct. 783, 821 N.E.2d 95 (Mass. App. Ct. 2005), revâd, 446 Mass. 540, 845 N.E.2d 356 (reversing the appellate courtâs dismissal of the reckless conduct claims but declining to hear an appeal on the negligence claims). 3448 Id., 62 Mass. App. Ct. at 786, 821 N.E.2d at 99.
662 liability when a person is walking on a railroad track contrary to law.3449 Massachusetts law âexpressly prohibits all manner of trespass on railroad property and, implicitly, the presence of unauthorized persons when the approach of a train is imminent, i.e., when the gates are lowered blocking entrance to the crossing.â3450 The court held that a railroad operator is not negligent when an individual, including a minor, is injured or killed when the person is on a railroad track in violation of state law. Although Amtrak failed to sound its horn and exceeded the speed limit, the appellate court affirmed the dismissal of the plaintiffâs claim for recklessness.3451 However, the Supreme Judicial Court of Massachusetts remanded the case to the trial court because the plaintiff had provided sufficient evidence to overcome Amtrakâs motion for a summary judgment.3452 H. Liability of a Railroad for Falling Objects 1. Doctrine of Res Ipsa Loquitor held to apply when Train moved during Loading of Cargo In Miles v. St. Regis Paper Co.3453 the decedent, a member of an unloading crew for a rafting company, died when logs from a flatcar that he was unloading fell on him.3454 The decedentâs estate and surviving spouse sued the decedentâs employer as well as the Northern 3449 Id., 62 Mass. App. Ct. at 788-789, 821 N.E.2d at 101. 3450 Id., 62 Mass. App. Ct. at 789, 821 N.E.2d at 101. 3451 Id., 62 Mass. App. Ct. at 798, 821 N.E.2d at 107. 3452 Boyd v. Amtrak, 446 Mass. 540, 553-554, 845 N.E.2d 356, 367 (2006). 3453 77 Wash.2d 828, 467 P.2d 307 (1970). 3454 Id., 77 Wash.2d at 829, 467 P.2d at 308.
663 Pacific Railroad Company (Northern Pacific) that was transporting the logs.3455 The court held that the doctrine of res ipsa loquitor3456 applies to a railroad company when there is evidence that the company was negligent immediately prior to the accident.3457 When there is a prima facie showing that the doctrine of res ispa loquitor may apply, the burden shifts to the defendant to show that the defendant was not negligent.3458 Employees of Northern Pacific testified that the train had not moved after it was prepared for unloading; however, an employee of the rafting company testified that after a few logs had been unloaded the train moved fifteen to twenty seconds prior to the accident.3459 Based upon the testimony of the rafting company, the court held that the trial courtâs instruction on res ipsa loquitor was proper and affirmed the jury verdict that awarded damages to the surviving wife and administratrix of the decedentâs estate.3460 2. Railroad not Liable for Injuries Caused by a Falling Object In Casella v. Norfolk & W. R. Co.3461 the court held that Norfolk & Western Railway Company (N&W) was not liable for injuries sustained by Casella, an employee, when unloading 3455 Id., 77 Was.2d at 829, 467 P.2d at 307. 3456 As stated in Kind v. Seattle, 50 Wn.2d 485, 489, 312 P.2d 811, 814 (1957), when âa plaintiffâs evidence establishes that an instrumentality under the exclusive control of the defendants caused an injurious occurrence, which ordinarily does not happen if those in control of the instrumentality use ordinary care, there is an inference, permissible from the occurrence itself, that it was caused by the defendantâs want of care.â 3457 Miles, 77 Wash.2d at 834, 467 P.2d at 310. 3458 Id. 3459 Id., 77 Was.2d at 829-830, 467 P.2d at 308. 3460 Id., 77 Wash.2d at 835, 467 P.2d at 310. 3461 381 F.2d 473 (4th Cir. 1967).
664 cargo from its trainâs cars because there was no evidence that N&W caused the accident.3462 A railroad has a limited duty to correct latent defects on the outside of the railcar observable by an inspection or to correct defects of which the railroad was previously made aware or that it created.3463 Casella was injured when a bale of paper struck him on the head as he opened the door to a railcar where the bale was stored.3464 However, the Fourth Circuit held that a railroad is only responsible for safely transporting cargo and is not âresponsible for a shipperâs improper loading of a bulk commodity which caused injury to an employee of the consignee.â3465 I. Last Clear Chance Doctrine 1. Doctrine held Inapplicable to a Collision between an Automobile and a Train at a Railroad Crossing In Newman v. Missouri P. R. Co.3466 the Fifth Circuit held that the last clear chance doctrine did not apply to a collision between an automobile and a train at what the court described was an âunusual and dangerousâ crossing.3467 If a crossing is unusual and dangerous, a plaintiffâs claim is not barred because of the plaintiffâs contributory negligence.3468 However, the court held that the plaintiff Newman was negligent because Newman did not stop at the crossing before proceeding across it.3469 The last clear chance doctrine that may have saved the 3462 Id. at 479. 3463 Id. at 476. 3464 Id. at 475. 3465 Id. at 475-476 (citing Lewis v. New York, O. & W. Ry., 210 N.Y. 429, 104 N.E. 944 (N.Y. 1914)). 3466 545 F.2d 439, 447 (5th Cir. 1977). 3467 Id. at 442. 3468 Id. at 445.
665 plaintiffâs claim did not apply because â[t]here was no compelling evidence establishing that there existed a time during which plaintiff was helpless while the train crew were not.â3470 The plaintiff was helpless once it became apparent that he would not be able to stop his vehicle before reaching the railroad tracks.3471 The court affirmed in part and reversed in part by finding that the trial court erred in imposing liability on the trainâs engineer.3472 Article 2. Determining when the Last Clear Chance Doctrine Applies An article entitled âLast Clear Chance in Tennesseeâ discusses how the states interpret and apply the last clear chance doctrine in negligence cases.3473 A prerequisite for the doctrine is that the plaintiff must have been contributorily negligent.3474 When the last clear chance doctrine applies it has the effect of excusing the plaintiffâs contributory negligence, resulting in the defendant remaining liable for its own negligence. As defined by the cases discussed in the article, the doctrine means that ââeven though plaintiff was negligent, yet, if the defendant after discovering his peril, or by the exercise of ordinary care should have discovered it, could have avoided the consequence of such negligence by the exercise of ordinary care and failed to do so, the defendant is liable.ââ3475 Thus, the doctrine 3469 Id. at 441. 3470 Id. at 447. 3471 Id. at 447 N 9. 3472 Id. at 447. 3473 L. Anderson Galyon III, âComment: Last Clear Chance in Tennessee,â 39 Tenn. L. Rev. 104 (1971). 3474 Id. at 107. 3475 Id. at 105 (quoting Harbor v. Wallace, 31 Tenn. App. 1, 9-10, 211 S.W.2d 172, 175 (1946)).
666 is an exception to the common law rule of contributory negligence, with proximate cause used as its justification or basis. Thus the defendantâs ability to avoid the accident ârenders plaintiffâs negligence remote and defendantâs negligence the proximate cause thereof.â ⦠Although a few states reject the doctrine, most will apply it where the plaintiff is in peril and cannot extricate himself from his situation and the defendant actually discovers this peril, has the opportunity to avoid the accident, but fails to do so because of a lack of reasonable care.3476 Cases J. Admissibility of Evidence of Prior Accidents 1. Admissibility of Prior Accidents as Evidence of a Railroadâs Knowledge of a Dangerous Condition In Mikus v. Norfolk and Western Ry. Co.3477 the plaintiff Mikus, an employee of N&W, sued under FELA after being injured when a motorist drove through a railroad crossing and broke a safety gate that struck Mikus.3478 An Illinois appellate court held that evidence of prior accidents was properly admitted into evidence because the evidence showed that N&W knew of a dangerous condition at the crossing. Moreover, the court held that N&Wâs defense counsel opened the door to evidence of prior incidents of broken gates at the crossing when counsel examined a signal maintainer for the railroad.3479 The signal maintainer testified for the defense âthat the gates operated safely for several years prior to [the date of the incident] and defendant maintained a crossing with safely operating gates.â3480 3476 Id. at 106 (footnotes omitted). 3477 312 Ill. App.3d 11, 726 N.E.2d 95 (Ill. App. 2000). 3478 Id., 312 Ill. App.3d at 15, 726 N.E.2d at 99, 100. 3479 Id., 312 Ill. App.3d at 24-25, 726 N.E.2d at 106-107. 3480 Id., 312 Ill. App.3d at 25, 726 N.E.2d at 107.
667 However, the cross-examination showed that N&W was on notice of a hazardous condition at the crossing.3481 The signal maintainer admitted on cross-examination that he repaired the signals at the crossing over one hundred times over a two year period in 1991 and 1992;3482 that he repaired the gates at least once a week and sometimes twice a day in the months prior to the accident; and that N&W changed the material of the gate from wood to aluminum and fiberglass so that the gates could be repaired more quickly and less expensively.3483 The court held that N&W was liable under FELA because the railroad knew of prior accidents and broken crossing gates at the crossing but failed to warn employees of the hazard.3484 2. Inadmissibility of Evidence of Prior Accidents too Remote in Time In Richardson v. Norfolk Southern Ry. Co.3485 a sixteen-year old motorist died after he drove his vehicle across a railroad crossing and a Norfolk Southern train struck his vehicle.3486 The decedentâs mother sued Norfolk Southern and Alcorn County where the accident occurred.3487 The plaintiff alleged that Norfolk Southern failed to maintain adequate warning devices; that it negligently allowed overgrown vegetation to obstruct visibility at the crossing; 3481 Id. 3482 Id., 312 Ill. App.3d at 23, 726 N.E.2d at 105. 3483 Id., 312 Ill. App.3d at 18, 726 N.E.2d at 101. 3484 Id., 312 Ill. App.3d at 22, 726 N.E.2d at 104-105. 3485 923 So.2d 1002, 1009-1010 (Miss. 2006) (followed by Irby v. Travis, 935 So.2d 884 (Miss. 2006) (holding that evidence of prior accidents was inadmissible because the conditions of the accidents were not similar). 3486 Id. 3487 Id.
668 and that the trainâs crew failed to use the trainâs horn and did not operate the train at a safe speed.3488 At trial, the plaintiff attempted to admit evidence of a prior accident at the same crossing that occurred thirteen years earlier. The Supreme Court of Mississippi held that accidents thirteen years apart are too remote to be admitted as evidence of prior accidents. For prior accidents to be admissible, a plaintiff must prove â(1) the existence of a dangerous condition[] and[] (2) the defendantâs notice or knowledge of such dangerous condition.â3489 However, in general, evidence of accidents over a year prior to the accident in dispute is not admissible; neither is evidence admissible of accidents that occurred after the accident.3490 In Richardson, the court also held that the FRSA preempted the plaintiffâs tort claim under state law based on inadequate signalization even though the crossing did not have flashing signal lights and automatic gates.3491 3. Evidence of Prior Accidents Inadmissible when Vehicles were Travelling in Opposite Directions The court in Union Pacific R. R. Co. v. Barber3492 held that conditions were not substantially similar when vehicles involved in other accidents or incidents (i.e., near-misses) had approached a crossing in opposite directions and, thus, ââhad entirely different perspectives of the crossing.ââ3493 In Barber, a Union Pacific train struck a garbage truck that one of the 3488 Id. 3489 Id. (citations omitted). 3490 Id. at 1010. 3491 Id. at 1006, 1009. 3492 356 Ark. 268, 149 S.W.3d 325 (Ark. 2004), cert. denied, motion granted by, 125 S. Ct. 320, 160 L. Ed.2d 249 (2004). 3493 Id., 356 Ark. at 291, 149 S.W.3d at 340 (citation omitted).
669 plaintiffs was driving in a northbound direction. The truck driver alleged that his vision was blocked by excessive vegetation and that the train failed to give any warning that it was approaching.3494 The trial court permitted evidence of two prior near misses at the same crossing, one involving a vehicle that was traveling northbound, and one that was traveling southbound.3495 The Supreme Court of Arkansas held that the party offering the evidence for admission has the burden of showing that the prior events are substantially similar to the accident being litigated.3496 The plaintiffsâ evidence did not meet the test of substantial similarity when the evidence was based on vehicles that were travelling in opposite directions.3497 However, the trial court properly admitted evidence of overgrown vegetation that obstructed the vision of motorists travelling northbound.3498 The court affirmed the jury verdict in favor of the plaintiffs. Article 4. Admission of Evidence of Prior Accidents in Tort Cases involving Defective Premises An article in the Journal of the Missouri Bar analyzes Missouri law on the admissibility of evidence of prior accidents in negligence cases involving the same defendant and defective 3494 Id., 356 Ark. at 279, 149 S.W.3d at 332. 3495 Id., 356 Ark. at 290, 149 S.W.3d at 339. 3496 Id. 356 Ark. at 288-289, 149 S.W.3d at 338. 3497 Id., 356 Ark. at 291, 149 S.W.3d at 340. 3498 Id. The court held that the record presented sufficient evidence to support a verdict by the jury for negligence. Id., 356 Ark. at 294, 149 S.W.3d at 342. The court also held that punitive damages of $25 million were not excessive in light of the railroadâs highly reprehensible conduct of ignoring constant complaints about the dangerous condition and destroying relevant evidence. Id., 356 Ark. at 303, 149 S.W.3d at 348.
670 premises.3499 Evidence of prior accidents may not be used to show that a defendant was negligent but only to show that the defendant was on notice of a dangerous condition.3500 The article discusses two Missouri cases against railroads in which the plaintiffs wanted to present evidence of prior accidents. In one case, the Missouri Supreme Court upheld the appellate courtâs decision to âpermit[] evidence of previous close calls at a railroad crossing due to an inaudible warning bell at the crossingâ because âthe defendant was bound to know that they were unusual and that the roadway was thereby rendered more dangerous.â3501 In the second Missouri case, an appellate court upheld the admission of evidence of prior signal malfunctions and accidents. The accidents or incidents were sufficiently similar to the one being litigated and showed the railroadâs knowledge of a high degree of danger at a crossing.3502 3499 James D. Walker, Jr., âEvidence of Prior Accidents/Incidents in Premises Defect Cases,â 64 J. Mo. B. 22 (2008). 3500 Id. 3501 Id. at 23 (discussing Grothe v. St. Louis-San Francisco Railway Co., 460 S.W.2d 711 (Mo. 1970)). 3502 Id. at 24 (discussing Lohmann v. Norfolk & Western Railway Co., 948 S.W.2d 659 (Mo. App. W.D. 1997)).
671 XXIX. MANUAL ON UNIFORM TRAFFIC CONTROL DEVICES â PART 8 A. Introduction Part 8 of the Manual on Uniform Traffic Control Devices (MUTCD or Manual) governs Traffic Control for Railroad and Light Rail Transit Grade Crossings.3503 Section B explains why the MUTCD is the national standard. Section C discusses the meaning of the paragraphs in the MUTCD that are designated as standards, guidance statements, option statements, and support statements. Section D highlights some of the specific changes that the 2009 edition of the Manual made to part 8. Sections E and F explain two important revisions that were made to the MUTCD after its adoption and publication. Section G provides information on when some states adopted the 2009 version. Section H analyzes several recent cases that involve railroads and the MUTCD, such as federal preemption of claims under state law, limited situations when there may be a waiver of federal preemption even though federal funds were used to upgrade or replace warning devices, and a plaintiffâs failure to show that a crossing did not comply with the MUTCD or that a crossing was unusually dangerous. Statutes and Regulations B. The MUTCD as the National Standard The FHWA is authorized to prescribe standards for traffic control devices on all roads open to public travel pursuant to 23 U.S.C. §§ 109(d), 114(a), 217, 315, and 402(a). Consequently, the 2009 MUTCD promulgated by the FHWA âis the national standard for all traffic control devices installed on any street, highway, or bicycle trail open to public travel.â3504 3503 The MUTCD is available at http://mutcd.fhwa.dot.gov/pdfs/2009r1r2/mutcd09r1r2editionhl.pdf and is hereinafter referred to as the â2009 MUTCD.â 3504 23 C.F.R. § 655.603(a) (2014).
672 In the MUTCD the phrase open to public travel âincludes toll roads and roads within shopping centers, airports, sports arenas, and other similar business and/or recreation facilities that are privately owned but where the public is allowed to travel without access restrictions.â3505 To remain eligible for federal highway and highway safety program funds, a state must adopt the national MUTCD as a state regulation; adopt a state MUTCD that is approved by the Secretary of Transportation as being in âsubstantial conformanceâ3506 with the national MUTCD; or adopt the national MUTCD in conjunction with a state supplement.3507 C. MUTCDâs Standards, Guidance, Options, and Support As explained by an Ohio court, the MUTCD is âorganized to differentiate between âStandards that must be satisfied ⦠Guidances that should be followed ⦠and Options that may be applicable for the particular circumstances of a situation.ââ3508 Only those provisions that are designated as standards are mandatory.3509 In the MUTCD a statement that is a standard signifies ârequired, mandatory, or specifically prohibitive practice regarding a traffic control device.â3510 Standards typically use 3505 23 C.F.R. part 655 subpart F (2014). See also, Oliver v. Ralphs Grocery Co., 654 F.3d 903, 909-910 (9th Cir. 2011). 3506 For the meaning of meaning of âsubstantial conformanceâ see Federal Highway Administration, Traffic Control Devices on Federal-Aid and Other Streets and Highways; Standards, Final Rule, 74 Fed. Reg. 75111 (Dec. 14, 2006). 3507 See 23 U.S.C. §§ 109(d) 402(c)(2014); 23 C.F.R. § 655.603(b)(3) (2014). 3508 Yonkings v. Piwinski, 2011-Ohio-6232 P23 (Ohio App. 2011) (citation omitted). 3509 American Family Mutual Insurance Co. v. Outagamie County, 2012 WI. App. 60, P19, 341 Wis.2d 413, 816 N.W.2d 340 (Wis. Ct. App. 2012) (citation omitted). 3510 2009 MUTCD, supra note 3503, at 10.
673 the verb shall and never use the term should or may.3511 Standards are âsometimes modified by Options.â3512 A guidance statement in the Manual is a âstatement of recommended, but not mandatory, practice in typical situations, with deviations allowed if engineering judgment or [an] engineering study indicates the deviation to be appropriate.â3513 Guidance statements typically use the verb should and never use the term shall or may.3514 Guidance statements also are sometimes modified by Options.3515 Although standards are mandatory, guidance statements are not mandatory.3516 As stated, standards and guidance statements may be modified by Options.3517 An option statement is a âstatement of practice that is a permissive condition [that] carries no requirement or recommendation.â3518 Options typically use the verb may and never use the term shall or should.3519 The final type of statements found in the MUTCD are Support statements, which are âinformationalâ and do ânot convey any degree of mandate, recommendation, authorization, 3511 Id. 3512 Id. 3513 Id. 3514 Id. 3515 Id. 3516 Walters v. Columbus, 2008 Ohio 4258 (Ohio App. 2008). 3517 Id. 3518 Id. 3519 Id.
674 prohibition, or enforceable condition.â3520 Support statements do not use the verbs shall, should, or may.3521 D. Discussion of Some Specific Changes in Part 8 of the 2009 MUTCD On December 16, 2009, the FHWA published its final rule in regard to its notice of proposed amendments (NPA) on changes to be incorporated in the 2009 MUTCD.3522 The final rule discusses the amendments to part 8 of the MUTCD on Traffic Controls for Railroad and Light Rail Transit (LRT) Grade Crossings.3523 For example, several changes were made throughout Section 8B, Signs and Markings, so as to require the installation of a YIELD sign or STOP sign at all passive highway-rail grade crossings.3524 The current version of the 2009 MUTCD includes in Chapter 8 a Standard (i.e., a mandatory provision) that seems to be consistent with what the FHWA said in its Final Rule noted above. Sections 8 B.04(01) and (05) and the Guidance statement (06) seem to be of particular interest. It may be remembered that Standards are in bold print in the MUTCD. 3520 Id. 3521 Id. 3522 Federal Highway Administration, National Standards for Traffic Control Devices; the Manual on Uniform Traffic Control Devices for Streets and Highways; Revision; Final Rule, 74 Fed. Reg. 66730, 66780-66784 (Dec. 16, 2009), available at: http://www.gpo.gov/fdsys/pkg/FR-2009-12-16/html/E9- 28322.htm (last accessed March 31, 2015), hereinafter referred to as the â2009 Final Rule â MUTCD.â 3523 Id. at 66847. 3524 Id.
675 Section 8B.04 Crossbuck Assemblies with YIELD or STOP Signs at Passive Grade Crossings Standard: 01 A grade crossing Crossbuck Assembly shall consist of a Crossbuck (R15- 1) sign, and a Number of Tracks (R15-2P) plaque if two or more tracks are present, that complies with the provisions of Section 8B.03, and either a YIELD (R1-2) or STOP (R1-1) sign installed on the same support, except as provided in Paragraph 8. If used at a passive grade crossing, a YIELD or STOP sign shall be installed in compliance with the provisions of Part 2, Section 2B.10, and Figures 8B-2 and 8B-3. *** 05 A YIELD sign shall be the default traffic control device for Crossbuck Assemblies on all highway approaches to passive grade crossings unless an engineering study performed by the regulatory agency or highway authority having jurisdiction over the roadway approach determines that a STOP sign is appropriate. Guidance: 06 The use of STOP signs at passive grade crossings should be limited to unusual conditions where requiring all highway vehicles to make a full stop is deemed essential by an engineering study. Among the factors that should be considered in the engineering study are the line of sight to approaching rail traffic (giving due consideration to seasonal crops or vegetation beyond both the highway and railroad or LRT rights-of-ways), the number of tracks, the speeds of trains or LRT equipment and highway vehicles, and the crash history at the grade crossing.3525 Some of the other changes to the 2009 edition include the following. â In Section 8A.01, Introduction, the FHWA relocated and revised lightrail transit grade crossing information that had been in Section 10A.01 in the 2003 MUTCD.3526 â The FHWA relocated Section 10A.02 of the 2003 MUTCD to a new Section 8A.03, Use of Standard Devices, Systems, and Practices at Highway-LRT Grade Crossings, as also revised by the 2009 edition.3527 The new section contains provisions that apply only to light-rail grade crossings.3528 3525 2009 MUTCD, supra note 3503, at § 8B.04 (emphasis supplied). 3526 2009 Final Rule â MUTCD, supra note 3522, at 66847. 3527 Id.
676 â The FHWA adopted a new Section 8A.06 on Illumination at Grade Crossings that contains information that had been included in Section 8C of the 2003 MUTCD.3529 â The MUTCD includes a new Section 8A.07, Quiet Zone Treatments at Highway-Rail Grade Crossings. 3530 â In Section 8B.01, Purpose, the existing SUPPORT and STANDARD statements were relocated from Section 10C.01 of the 2003 MUTCD with some editorial revisions.3531 â Figure 8Bâ1 (Figure 8Bâ3 in the 2003 MUTCD), Regulatory Signs and Plaques for Grade Crossings, combines Figure 8Bâ3 and Figure 10Câ2 that were in the 2003 MUTCD and incorporated the NPAâs proposed R8â10a and R10â6a signs.3532 â Section 10C.04 in the 2003 MUTCD was relocated to Section 8B.05 and re-titled ââUse of STOP (R1â1) or YIELD (R1â2) Signs without Crossbuck Signs at Highway-Light Rail Grade Crossing.â3533 â The lightrail transit grade crossing information that was proposed in the NPA was combined with Section 8B.04 in the 2003 MUTCD and revised to form new Section 8B.06 entitled Grade Crossing Advance Warning Signs (W10 Series).3534 Other changes specifically relating to Part 8 of the MUTCD are explained in the final rule.3535 3528 Id. 3529 Id. at 66847-66848. 3530 Id. at 66848. 3531 Id. at 66849. 3532 Id. 3533 Id. at 66850. 3534 Id. 3535 See 2009 Final Rule â MUTCD, supra note 3522.
677 E. Revision 1 of the MUTCD Since 2009 the FHWA has made at least two important revisions of the MUTCD. As originally published, the 2009 edition of the MUTCD stated that standards âshall not be modified or compromised based on engineering judgment or engineering studies,â3536 a provision that the FHWA deleted in a rule published on May 14, 2012.3537 In its final rule the FHWA explained that this prohibition has always been inherent in the meaning of Standards, but the FHWA is aware of cases where the lack of explicit text to this effect has resulted in the misapplication of engineering judgment or studies. Some agencies believed that Standards could be ignored based on engineering judgment or an engineering study, which is not the case.3538 Nevertheless, the FHWAâs final rule specifically clarified the definition of the term standard in the MUTCD, as well as clarified the use of engineering judgment and studies in relation to standards in the application of traffic control devices.3539 The effect of the final rule and Revision 1 is (1) to omit certain language that was included in the 2009 MUTCD and (2) to restore language that appeared in the 2003 MUTCD but that was deleted in the 2009 edition.3540 First, the FHWA removed the sentence â[s]tandard statements shall not be modified or compromised based on engineering judgment or engineering studyâ that had been added to the 3536 Id. at 66737. 3537 National Standards for Traffic Control Devices; the Manual on Uniform Traffic Control Devices for Streets and Highways; Revision, 77 Fed. Reg. 28,456; 28,457 (May 14, 2012). 3538 Id. 3539 Federal Highway Administration, National Standards for Traffic Control Devices; the Manual on Uniform Traffic Control Devices for Streets and Highways; Revision; Final Rule, 77 Fed. Reg. 28456 (May 14, 2012). The rule became effective on June 13, 2012. Id. 3540 Id.
678 MUTCD in Section 1A.13 on definitions of headings, words, and phrases.3541 Second, the FHWA restored three guidance sentences that were included in Section 1A.09, âEngineering Study and Engineering Judgment,â of the 2003 edition that were deleted in the 2009 edition. The guidance sentences that the FHWA restored and that now are a part of the 2009 MUTCD are: The decision to use a particular device at a particular location should be made on the basis of either an engineering study or the application of engineering judgment. Thus, while this Manual provides Standards, Guidance, and Options for design and applications of traffic control devices, this Manual should not be considered a substitute for engineering judgment. Engineering judgment should be exercised in the selection and application of traffic control devices, as well as in the location and design of roads and streets that the devices complement.3542 The FHWA stated that â[t]he inclusion of such language will continue our current practice under Official Interpretation 1(09)â1 (I) to allow deviations from a STANDARD only on the basis of either an engineering study or the application of engineering judgment.â3543 F. Revision 2 of the MUTCD The second important revision of the 2009 MUTCD concerns compliance dates in Table I-2. On May 14, 2012, FHWA also published a second final rule that revised Table Iâ2 of the MUTCD by eliminating the compliance dates for 46 items (8 that had already expired and 38 that had future compliance dates) and extends and/or revises the dates for 4 items. The target compliance dates for 8 items that are deemed to be of critical safety importance will remain in effect.3544 In the final rule FHWA explained, moreover, that â[w]hen new provisions are adopted in 3541 Id. at 28457. 3542 Id. at 28458. 3543 Id. 3544 Federal Highway Administration, National Standards for Traffic Control Devices; the Manual on Uniform Traffic Control Devices for Streets and Highways; Revision, Final Rule, 77 Fed. Reg. 28460 (May 14, 2012).
679 a new edition or revision of the MUTCD, any new or reconstructed traffic control devices installed after adoption are required to be in compliance with the new provisionsâ¦.â3545 However, unless the FHWA establishes compliance dates for upgrading existing devices, such â[e]xisting devices already in use that do not comply with the new MUTCD provisions are expected to be upgraded by highway agencies over time to meet the new provisionsâ¦.â3546 G. Date of State Adoption of the 2009 MUTCD The version of the Manual in effect at the time of any alleged violation of the Manual is the version that applies in a tort action.3547 Of twenty-one states responding to a survey conducted for a recent NCHRP publication on the 2009 MUTCD, eighteen states had adopted the 2009 MUTCD.3548 Of those states that had adopted the MUTCD, eight adopted it in 2012; five did so in 2011, and one in 2010. Several states reported that they had adopted their own version that is in substantial conformance with the MUTCD.3549 The term substantial 3545 Id. 3546 Id. 3547 Shope v. City of Portsmouth, 2012 Ohio 1605 at P20 (Ohio Ct. App. 2012). 3548 E.g., Arizona DOT (adopted on January 13, 2012 (as modified by the Arizona Supplement to the 2009 MUTCD), available at: http://azdot.gov/docs/business/arizona-supplement-to-the-manual-on-uniform- traffic-control-devices-(2009-mutcd-edition).pdf) (last accessed March 31, 2015); Caltrans (Jan. 13, 2012); Kansas DOT (Dec. 16, 2011); Mich. DOT (adopted a Michigan version of the MUTCD on Dec. 1, 2011, that is in substantial compliance with the MUTCD); Nebraska Department of Roads (Apr. 26, 2012); New Hampshire DOT (Jan. 2012); New York DOT (2010); Oklahoma DOT (Apr. 2, 2012); Pennsylvania DOT (Feb. 2012); Texas DOT (adopted a MUTCD adopted on December 8, 2011, that is in âsubstantial complianceâ with the 2009 National MUTCD); Virginia DOT (Jan. 1, 2012); Washington DOT (Dec. 19, 2011); and Wisconsin DOT (May 25, 2011). 3549 Indiana DOT (Indiana adopted an Indiana version of the 2009 MUTCD in November 2011 that was revised in October 2012); Missouri Highway and Transportation Commission (adopted an Engineering Policy Guide (EPG)); Utah DOT (stating that in January 2012 the Utah MUTCD was found to be in substantial compliance with the National 2009 MUTCD); Washington DOT (stating that the MUTCD was adopted with modifications by the department on Dec. 19, 2011).
680 conformance means that a state MUTCD or supplement conforms at a minimum to the standards included in the national MUTCD.3550 For example, Missouri has developed an FHWA-approved Engineering Policy Guide (EPG) that is in substantial conformance with the MUTCD.3551 Cases H. Cases involving Railroads and the MUTCD 1. Federal Preemption of Claims based on Alleged Violations of the MUTCD In Illinois Central Railroad Company v. Daniel3552 the action began when Illinois Central sued Michael Daniel (M. Daniel), his employer, and M. Danielâs estate for negligence in damaging an Illinois Central train and the companyâs railroad tracks and right-of-way. The defendant and counter-plaintiff Clydine Daniel (C. Daniel) sued Illinois Central for negligence for having caused the death of her husband M. Daniel when an Illinois Central train collided with the decedentâs tanker-truck at a railroad crossing.3553 Illinois Central moved the court to dismiss a number of C. Danielâs negligence claims.3554 C. Daniel relied on an expertâs report that stated âthat under MUTCD (2003), § 8B.03, because the angle of the crossing restricted sight distance, an additional crossbuck sign should have been installed on the left side of the highway and that the backs of the crossbuck blades at the crossing were missing a strip of retroflective white 3550 See 23 CFR § 655.603(b)(1) (2014). 3551 Missouri Highway and Transportation Commission (stating that the FHWA approved the EPG by letter dated December 30, 2011 and that the Commission has not adopted the National MUTCD in Missouri since 2001). 3552 901 F. Supp.2d 790 (S.D. Miss. 2012). 3553 Id. at 792. 3554 Id. at 794.
681 material required by the MUTCD.â3555 However, on the MUTCD claims, the court, relying on precedents established by the United States Supreme Court and the Fifth Circuit, held that âfederal law pre-empted state law at the time federally funded signals were installed at this crossing. The intervening installation of additional signs does not operate to replace federal law with state law. Tort claims based on the adequacy of signals and warnings, then, are pre-empted by federal law.â3556 2. Federal Preemption of Negligence Claims for Inadequate Warning Devices Another case on preemption is Murrell v. Union Pacific Railroad Company.3557 On June 28, 2004, Elfriede Murrell, plaintiffâs decedent, was struck and killed by an Amtrak train as she walked across the railroad tracks.3558 Although the MUTCD is not mentioned, on the plaintiffâs claims that there were inadequate warning devices, the court held that federal law preempted the claims.3559 Furthermore, federal law also preempted a claim for failure to warn.3560 However, on the claim for inadequate visibility the court held that because the federal regulations at issue âdo not âcoverâ state common law sight distance claims, it follows that plaintiffâs visibility claims are not preempted.â3561 Thus, the court granted Union Pacificâs and Amtrakâs motions to dismiss the 3555 Id. at 802. 3556 Id. at 803. 3557 544 F. Supp.2d 1138 (D. Or. 2008). 3558 Id. at 1142. 3559 Id. at 1152 (holding that 23 C.F.R. §§ 646.214(b)(3) and (4) preempted state law claims for failure to maintain adequate warning devices at railroad crossings when federal funds were used to improve the crossing at issue). 3560 Id. at 1153. 3561 Id. at 1154.
682 plaintiffâs negligence claims based on the trainâs excessive speed and the defendantsâ failure to issue a slow order, failure to warn, and inadequate warning devices.3562 However, the court denied the railroad defendantsâ motions to dismiss the plaintiffâs negligence claims for defendantsâ failure to provide adequate visibility, failure to eliminate a dangerous condition, and failure to maintain a proper lookout.3563 3. Waiver of Federal Preemption based on Federal Funding to Upgrade or Replace Warning Devices In Indiana Rail Road Company v. Davidson3564 the issue was whether federal preemption applied concerning the adequacy of traffic warning devices that were installed at the site of a fatal collision between an Indiana Rail Road Company (Indiana Rail Road) locomotive and Davidsonâs vehicle.3565 The court explained that originally in 1978 reflectorized crossbuck signs had been installed under a federally funded project at the crossing where the accident occurred.3566 On June 5, 2009, prior to the accident, Indiana Rail Road removed the crossbuck signs at the crossing. To fund the installation of new signs the railroad company applied for and received state funds from the Indiana Department of Transportation.3567 The railroad argued on appeal that the trial court erred when it denied the Indiana Rail Roadâs motion for a partial summary judgment. Relying on âestablished case lawâ the company 3562 Id. at 1159. 3563 Id. 3564 983 N.E.2d 145 (Ind. Ct. App. 2012). 3565 Id. at 146. 3566 Id. at 146-147. 3567 Id.
683 argued that âonce federal funds have been applied in the installment of traffic warning devices at a particular railroad crossing, state tort law is preempted regardless of later changing circumstancesâ¦.â3568 The court held, however, that federal preemption no longer applied: Because state funds were requested and granted, the Indiana Rail Road became responsible for assessing the crossingâs safety needs pursuant to INDOTâs regulations. There is no evidence indicating that the federal government approved the newly located crossbucks. [W]e conclude that there is a genuine issue of material fact whether the federal government affirmatively abandoned the project and federal preemption no longer applies to the Feree Drive railroad crossing.3569 For that reason, the Court of Appeals ruled that the trial court properly denied the Indiana Rail Roadâs motion for a partial summary judgment.3570 4. Failure to Show that a Crossing did not Comply with the MUTCD In Ill. Cent. Gulf R.R. Co. v. Travis3571 the decedent Travis died on May 16, 1997, when an Illinois Central Railroad Company (Illinois Central) train struck his vehicle at a crossing.3572 Although there was a trial verdict in favor of Travis for $4.875 million, the Supreme Court of Mississippi reversed the trial courtâs decision to deny Illinois Centralâs motion for judgment notwithstanding the verdict.3573 Although there were a number of issues asserted by Illinois Central on appeal, one issue was whether a crossbuck sign violated Mississippi Code § 77-9-247 3568 Id. at 148-150 (citing Cochran v. CSX Transportation, Inc., 112 F. Supp.2d 733 (N.D. Ind. 2000)). 3569 Id. at 152. 3570 Id. 3571 106 So.3d 320 (Miss. 2012), rehearing denied, 2013 Miss. LEXIS 93 (Miss., Feb. 14, 2013). 3572 Id. at 323. 3573 Id.
684 and the MUTCD § 8B.03 (2009 ed.). Although § 8B.03 of the MUTCD included a standard3574 as well as guidance, the court held that âTravis presented no evidence that the crossbuck sign was not in compliance with the MUTCD.â3575 On this and other issues asserted on appeal, the court held that the trial court erred in denying Illinois Centralâs motion for judgment notwithstanding the verdict. 5. Failure to Show that a Crossing was Unusually Dangerous at Common Law In Brown v. Illinois Central Railroad3576 an Amtrak passenger train struck the plaintiff/appellant Brown in May 2008 as he drove his garbage truck across railroad tracks owned and operated by Illinois Central.3577 Although an expert report cited the MUTCD, the Fifth Circuit noted that â[u]nder Mississippi law, a railroad company owes the public a duty to signalize railroad crossings. Generally, it can satisfy this duty by complying with certain minimum statutory requirements, including the obligation to place a ârailroad crossbuckâ sign at a specified distance from the railroad crossing.â3578 Brown did not assert that Illinois Central failed to maintain the crossing at issue in accordance with statutory requirements. Thus, the only issue was whether the crossing was âunusually dangerousâ and therefore triggered a common law duty to install additional signaling devices.3579 However, Brownâs expert failed to show how 3574 âAs a minimum, one Crossbuck sign shall be used on each highway approach to every highway-rail grade crossing, alone or in combination with other traffic control devices.â Id. at 333 (quoting Standard in 2009 MUTCD § 8B.03). 3575 Id. at 334 (emphasis in original). 3576 705 F.3d 531 (5th Cir. 2013). 3577 Id. at 533. 3578 Id. at 537 (footnotes omitted). 3579 Id.
685 the crossing was any more âdeceptively dangerous ⦠than the hundreds of other crossings in Mississippi.â3580 3580 Id. at 539 (footnote omitted).
686 XXX. MOVING AHEAD FOR PROGRESS IN THE 21ST CENTURY - MAP-21 A. Introduction The Moving Ahead for Progress in the 21st Century Act (MAP-21), effective in October 2012, authorized programs through September 30, 2014.3581 MAP-21 authorized $10.6 billion in fiscal year 2013 and $10.7 billion in fiscal year 2014 for public transportation.3582 Joseph C. Szabo, the Administrator of the Federal Railroad Administration (FRA), noted that MAP-21 does not contain a rail title but rather focuses on the authorization and funding of programs for highways and transit programs.3583 Most rail programs are authorized and funded either by the Rail Safety Improvement Act (RSIA) or the Passenger Rail Investment and Improvement Act (PRIIA).3584 RSIA âhas enabled [the FRA] to focus on risk reduction programs and some of the most challenging areas of safety.â3585 PRIIA âlaid the policy framework for [FRA] to invest in more than 150 passenger rail projects.â3586 RSIA and PRIIA expire in fiscal year 2014. Although there is no specific rail title in MAP-21, several sections of MAP-21 are applicable to railroads; thus, â[w]hile intercity passenger rail projects are not eligible under 3581 Federal Transit Administration, FTA Office of Budget and Policy, Moving Ahead for Progress in the 21st Century Act (MAP-21), at 1, available at: http://www.fta.dot.gov/documents/MAP21_essay_style_summary_v5_MASTER.pdf (last accessed March 31, 2015), hereinafter referred to as âFTA MAP-21 Summary.â 3582 Id. 3583 Joseph C. Szabo, Federal Railroad Administrator, Prepared Remarks American Short Line and Regional Railroad Association Annual Convention â100 Years of Connectionsâ (April 29, 2013) at 6,â available at: http://www.fra.dot.gov/Elib/Details/L04514 (last accessed March 31, 2015), hereinafter referred to as âSzabo.â 3584 Id. at 2. 3585 Id. 3586 Id.
687 MAP-21, projects that improve commuter rail service are eligible under the same programs that can fund transit projects. As many commuter rail systems operate on the same tracks as Amtrak service, these projects can help improve reliability for both commuter rail and Amtrak trains.â3587 As discussed in sections B through F, there are several sections of MAP-21 that may improve rail service. B. Public Transportation Safety Under MAP-21 § 20021, amending 49 U.S.C. § 5329, the âFTA must develop safety performance criteria for all modes of transportation (rail, bus, etc.)â and minimum safety performance standards for all public transportation excluding rolling stock regulated by the Secretary or another federal agency.3588 Furthermore, MAP-21 includes new requirements for the State Safety Oversight program (SSO or SSOP) âthrough which States with heavy rail, light rail, and streetcar systems must establish safety oversight for these transit systems.â3589 MAP-21 âprovides FTA with several additional authorities including the authority to inspect and audit all public transportation systems....â3590 For fiscal year 2013, $21,945,771 has been allocated for eligible states to develop or carry out SSO program activities;3591 for fiscal year 2014, 3587 Transportation for America, Making the Most of MAP-21: A Guide to the 2012 Federal Transportation Law and How to Use it for Positive Change in your Community, at 81, available at: http://t4america.org/wp-content/uploads/2012/11/MAP-21-Handbook-Web.pdf (last accessed March 31, 2015). 3588 FTA MAP-21 Summary, supra note 3581, at 2; MAP-21 § 20021; see 49 U.S.C. § 5329(b)(2) (2014). 3589 FTA MAP-21 Summary, supra note 3581, at 2; MAP-21 § 20021; see 49 U.S.C. § 5329(4) (2014). 3590 FTA MAP-21 Summary, supra note 3581, at 2; MAP-21 § 20021; see 49 U.S.C. § 5329(f) (2014). 3591 Federal Transit Administration, FY 2013 Section 5329(e) State Safety Oversight Program Apportionment, available at: http://www.fta.dot.gov/documents/Table_13-- FY_13_SSO_Apportionments.pdf (last accessed March 31, 2015).
688 $22,293,250 is available.3592 Although SSO programs oversee rail transit, not all funds may be used for any purpose related to rail transit. Funds for the SSO program are intended to support administrative and operating costs for State safety oversight of rail transit systems. Therefore, the following costs are ineligible: (a) Project costs that cover rail transit system expenses; (b) Project costs for State activities unrelated to the SSOP; (c) Project costs that directly support the operation or maintenance of a rail transit system; (d) Project costs for which the recipient has received funding from another Federal agency; and (e) Other project costs that FTA determines are not appropriate for the SSOP (sic).3593 MAP-21 § 20021, amending 49 U.S.C. § 5329, calls for the Secretary of Transportation to âestablish a public transportation safety certification training program for Federal and State employeesâ3594 pursuant to which âeach recipient or State[] shall certify that the recipient or State has established a comprehensive agency safety plan....â3595 MAP-21 defines ârecipientâ as âa State or local governmental authority, or any other public transportation system operator, that receives financial assistance.â3596 An eligible state is a state that has âa rail fixed guideway public transportation system within the jurisdiction of the stateâ that is not regulated by the FRA 3592 Id. 3593 State Safety Oversight Formula Grant Program, 79 Fed. Reg. 13385 (March 10, 2014). 3594 Anita Estell and Christian Washington, âSpecial Transportation Report: The Moving Ahead for Progress in the 21st Century Act (MAP-21),â at 50 (discussing MAP-21âs amendment of 49 U.S.C. § 5301), available at: http://www.polsinelli.com/~/media/Articles%20by%20Attorneys/Estell_Washington_July2012 (last accessed March 31, 2015); MAP-21 §20021; see 49 U.S.C. § 5329(c)(2014), hereinafter referred to as âEstell and Washington.â 3595 Id. at 47-48; MAP-21 § 20021; see 49 U.S.C. §§ 5329(d)(1)(A)-(G)(2014). 3596 Id. at 47; MAP-21 § 20021; see 49 U.S.C. § 5329(a) (2014).
689 or âa rail fixed guideway public transportation systemâ that is under construction and will not be regulated by the FRA.3597 C. Comprehensive Freight Plan In MAP-21 § 1118, added in a note to 23 U.S.C. § 167, the Secretary of Transportation is to encourage each state to develop a comprehensive state freight plan.3598 That is, â[s]tates are strongly encouraged to coordinate [the] development of their State rail plans with their freight planning efforts, including preparation of the State freight plan, considering shifts in the nature of freight demand and the type of freight in assessing emerging freight markets for rail.â3599 As one source observes, âMAP-21 also calls for a National Strategic Freight Plan.â3600 Thus, the United States Department of Transportation (DOT) created the Freight Policy Council that âis committed to taking a multimodal approach to freight development that allows each mode to do what it does most efficiently.... Secretary LaHood also has announced the formation of a Freight Advisory Committee.â3601 The DOTâs âNational Freight Advisory Committee (NFAC) will provide advice and recommendations to the Secretary on matters related to freight transportation in the United States 3597 MAP-21 § 20021; see 49 U.S.C. §§ 5329(e)(2)(A)-(B) (2014). 3598 MAP-21 § 1118; see 23 U.S.C. § 167 note (2014). 3599 Szabo, supra note 3583, at 6. 3600 Id. 3601 Id.
690 including the implementation of the freight transportation requirements of [MAP-21]â and the establishment of a National Freight Network.3602 According to the NFACâs charter, it shall undertake information gathering activities, develop technical advice, and present recommendations to the Secretary to further inform this policy including: development of a National Freight Strategic Plan; Establishment of the National Freight Network; Strategies to help States implement State Freight Advisory Committees and State Freight Plans; Development of measures of condition, safety, and performance for freight transportation...; [and] Other issues relating to the implementation of freight-related requirements of MAP-21 (sic).3603 D. Highway Safety Improvement Program MAP-21 § 1112, amending 23 U.S.C. § 148, authorized the Highway Safety Improvement Program (HSIP). As the name suggests, the program provides grants to improve highway safety by reducing âtraffic fatalities and serious injuries on all public roads.â3604 States involved in this project are required to identify hazardous locations including railway-highway crossings that pose a significant threat to human safety.3605 In addition to identifying dangerous locations, the states must collect data on crashes and determine the extent of the danger presented by a particular intersection, as well as create programs to correct and prevent hazardous conditions.3606 3602 United States Department of Transportation, National Freight Advisory Committee, available at: http://www.dot.gov/nfac (last accessed March 31, 2015). 3603 United States Department of Transportation, National Freight Advisory Committee, NFAC Charter, available at: http://www.dot.gov/nfac/charter (last accessed March 31, 2015). 3604 MAP-21 § 1112; see 23 U.S.C. § 148(b)(2) (2014). 3605 MAP-21 § 1112; see 23 U.S.C. § 148(c)(2)(B)(i) (2014). 3606 MAP-21 § 1112; see 23 U.S.C. §§ 148(c)(2)(C)-(E) (2014).
691 E. State of Good Repair Grants MAP-21 § 20027, amending 49 U.S.C. § 5337, established âa new grant program to maintain public transportation systems in a state of good repairâ that âreplaces the fixed guideway modernization program....â3607 Under the program, funding is limited to fixed guideway systems, including rail, bus rapid transit, passenger ferries, and high intensity bus lanes, i.e., buses that operate in high occupancy vehicle or HOV lanes.3608 The State of Good Repair program was granted $2,136.3 million for fiscal year 2013 and $2,165.9 million for fiscal year 2014.3609 Grants provided under this section may be used to replace and rehabilitate ârolling stock; track; line equipment and structures; signals and communications; power equipment and substations; passenger stations and terminals; [and] maintenance facilities and equipment....â3610 F. Asset Management Provisions MAP-21 § 20019, 49 U.S.C. § 5326, is a new section that ârequires FTA to define the term âstate of good repairâ and create objective standards for measuring the condition of capital assets, including equipment, rolling stock, infrastructure, and facilities.â3611 3607 FTA MAP-21 Summary, supra note 3581, at 3; see 49 U.S.C. §§ 5337(a)(1)(A)-(E) (2014). 3608 Id. 3609 U.S. Department of Transportation, Federal Transit Administration, MAP-21, Fact Sheet: State of Good Repair Grants Section 5337, available at: http://www.fta.dot.gov/documents/MAP-21_Fact_Sheet_- _State_of_Good_Repair_Grants.pdf (last accessed March 31, 2015). 3610 Estell and Washington, supra note 3594, at 55-56; 49 U.S.C. §§ 5337(b)(1)(A)-(K) (2012). 3611 Estell and Washington, supra note 3594, at 45; FTA MAP-21 Summary, supra note 3581, at 3.
692 XXXI. OCCUPATIONAL SAFETY AND HEALTH ACT A. Introduction The Occupational Safety and Health Act establishes standards and regulates the occupational safety and health of all employees. However, the Actâs standards and regulations do not apply when another federal or state statute or regulation exercises authority over an employeeâs working conditions. The Federal Railroad Administration (FRA) has issued a policy statement describing when the FRA, the United States Department of Transportation (DOT), or the Occupational Safety and Health Administration (OSHA) have sole or concurrent jurisdiction over the occupational safety and health of railroad employees. Moreover, the FRA and OSHA have signed a memorandum of agreement giving OSHA the authority to investigate claims of alleged discrimination against FRA employees. Finally, although the FRA has delineated when its standards supersede OSHAâs standards, when there is a dispute regarding which agency has jurisdiction, the courts decide by determining the extent to which FRA guidelines take precedence over OSHA regulations. Even when OSHA regulations are not applicable, evidence of an applicable OSHA regulation is admissible as evidence of a railroadâs negligence. Sections B and C discuss the OSHQA, its territorial scope, and standards and their applicability. Section D summarizes the FRAâs policy statement on occupational safety and health standards for railroads. Section E discusses OSHA and FRA coordination regarding the Federal Railroad Safety Act and employee protection. Sections F and G discuss whether OSHA regulations are preempted in a specific case and whether noncompliance with OSHA regulations may be used as evidence of an employerâs negligence.
693 Statutes and Regulations B. Occupational Safety and Health Act and its Territorial Scope [T]he Occupational Safety and Health Act] shall apply with respect to employment performed in a workplace in a State, the District of Columbia, the Commonwealth of Puerto Rico, the Virgin Islands, American Samoa, Guam, the Trust Territory of the Pacific Islands, Wake Island, Outer Continental Shelf lands defined in the Outer Continental Shelf Lands Act [43 U.S.C. § 1331 et seq.], Johnston Island, and the Canal Zone.3612 The Occupational Safety and Health Act does not supersede or affect any workmenâs compensation law, nor does the Act âenlarge or diminish or affect in any other manner the common law or statutory rights, duties, or liabilities of employers and employees under any law with respect to injuries, diseases, or death of employees arising out of, or in the course of, employment.â3613 Furthermore, nothing in the Occupational Safety and Health Act applies âto working conditions of employees with respect to which other Federal agencies[] and State agencies ⦠exercise statutory authority to prescribe or enforce standards or regulations affecting occupational safety or health.â3614 Section 655 provides that the Secretary of Labor will promulgate as an occupational safety or health standard any national consensus standard, and any established Federal standard, unless he determines that the promulgation of such a standard would not result in improved safety or health for specifically designated employees. In the event of conflict among any such standards, the Secretary shall promulgate the standard which assures the greatest protection of the safety or health of the affected employees.3615 3612 29 U.S.C. § 651, et seq. (2014); see 29 U.S.C. § 653(a) (2014). 3613 29 U.S.C. § 653(a) (2014). 3614 29 U.S.C. § 653(b)(1) (2014). 3615 29 U.S.C. § 655(a) (2014).
694 State agencies and courts still have jurisdiction over occupational safety and health standards and regulations promulgated pursuant to state law as long as there is no federal or national consensus standard that has been promulgated under § 655.3616 A state may apply to the Secretary of Labor to preempt applicable federal standards by submitting a state plan for the development of such standards and their enforcement; the Secretary may approve a plan based on eight criteria that are delineated in § 667.3617 The heads of federal agencies, except the head of the United States Postal Service, is responsible for establishing and maintaining âan effective and comprehensive occupational safety and health program which is consistent with the standards promulgated under section 655â¦.â3618 C. Occupational Safety and Health Standards and their Applicability The Code of Federal Regulations provides: None of the standards in this part shall apply to working conditions of employees with respect to which Federal agencies other than the Department of Labor, or State agencies acting under section 274 of the Atomic Energy Act of 1954, as amended (42 U.S.C. 2021), exercise statutory authority to prescribe or enforce standards or regulations affecting occupational safety or health.3619 D. FRA Policy Statement on Occupational Safety and Health Standards for Railroads In a policy statement the FRA has explained that it would concentrate its efforts on providing regulations that address railroad safety in areas directly related to railroad 3616 Id. 3617 29 U.S.C. § 667(c) (2014). 3618 29 U.S.C. § 668 (2014). 3619 29 C.F.R. § 1910.5(b) (2014).
695 operations.3620 The FRA stated that it would focus its efforts on âaddressing hazardous working conditions in those traditional areas of railroad operations in which [the FRA has] special competence.â3621 The areas of railroad operation include track, roadbed, and associated devices and structures; equipment; and human factors.3622 The FRA continues to exercise its jurisdiction through regulations that are applicable to the areas identified. Furthermore, the FRA âwill continue to administer a comprehensive system of accident/incident reporting for all events bearing on the safety or health of employees involved in any aspect of the rail transportation businessâ and will make the data available to OSHA.3623 The FRA has exercised its jurisdiction over track, roadbed, and associated devices through the Track Safety Standards (49 C.F.R. part 213);3624 the Signal Inspection Act (49 U.S.C. 26);3625 Signal Systems Reporting Requirements (49 C.F.R. part 233); Applications for 3620 On March 14, 1978, the FRA withdrew its notice of a proposed rulemaking on occupational and health standards for railroads. In its document terminating the rulemaking proceeding, the FRA issued a policy statement concerning the relationship between FRAâs and OSHAâs jurisdiction on occupational and health standards applicable to railroads. See United States Department of Transportation, Federal Railroad Administration, 49 C.F.R. part 221, Railroad Occupational Safety and Health Standards; Termination of Rulemaking Proceeding and Issuance of Policy Statement, 43 Fed. Reg. 10583 and 10585 (Mar. 14, 1978), available at: http://www.orosha.org/pdf/mous/F-1.pdf (last accessed March 31, 2015). 3621 Id. 3622 Id. at 10586. 3623 Id. at 10585. 3624 Id. at 10586 (prescribing geometric and other technical standards for track structures and roadbed and requiring a program for inspections). 3625 Id. (providing FRA with plenary authority over the installation, modification, inspection and maintenance of all signal systems and related systems and appliances).
696 the Discontinuance or Modification of Systems (49 C.F.R. part 235); and its General Inspection and Maintenance Standards (49 C.F.R. part 236).3626 The FRA has exercised its jurisdiction over equipment through the Safety Appliance Acts (45 U.S.C. §§ 1-16 (repealed after the policy statement));3627 regulations detailing how safety appliances must be designed and affixed (49 C.F.R. part 231); regulations prescribing certain inspection and maintenance standards for power brakes (49 C.F.R. part 232); the Locomotive Inspection Act (49 U.S.C. §§ 22-34);3628 the Steam Locomotive and Maintenance Standards (49 C.F.R. part 230); the Freight Car Safety Standards (49 C.F.R. part 215);3629 and regulations governing the removal of unsafe locomotives from service (49 C.F.R. part 216).3630 The FRA exercises control over and regulates human factors through regulations requiring programs of instruction, operational tests, and inspections (49 C.F.R. part 217); operating rules pertaining to the protection of employees working between or under rolling equipment, operations within yard limits, and rear flag protection (49 C.F.R. part 218); and regulations on the use of radio communications and the issuance of train orders (49 C.F.R. part 220).3631 Although the FRA has noted that there are some exceptions regarding sleeping quarters 3626 Id. 3627 Id. (requiring certain appliances such as automatic couplers, secure grab irons, and power brakes on all cars and locomotives). 3628 Id. (requiring that locomotives and appurtenances thereto be safe and suitable for the service to which they are put). 3629 Id. (regulations on the proper maintenance and inspection of freight cars issued in 1973 under the Federal Railroad Safety Act of 1970). 3630 Id. 3631 Id.
697 for employees not covered by the Hours of Service Act, the FRA has exercised its jurisdiction via the Hours of Service Act (45 U.S.C. §§ 61-64b).3632 OSHA has jurisdiction over the sleeping quarters of employees not covered by the Hours of Service Act and has concurrent jurisdiction with the FRA over sleeping quarters that are camp or bunk cars (e.g., railroad cars outfitted as temporary lodgings).3633 The FRA also enforces the Hazardous Materials Regulations that assure the occupational safety of employees by regulating the carriage or shipment of hazardous materials by rail (49 C.F.R. parts 171-74).3634 OSHA regulations âconcerning working surfaces deal with such matters as ladders, stairways, platforms, scaffolds and floor openingsâ that are generally applicable in railroad offices, shops, and other fixed work places.3635 However, there are three exceptions. First, the OSHA regulations do not apply to the design of locomotives and other rolling equipment used on a railroad.3636 Second, OSHA regulations on the guarding of open pits and ditches do not apply to âinspection pits in locomotive or car repair facilities.â3637 Third, OSHA regulations [do] not apply to ladders, platforms, and other surfaces on signal masts, catenary systems, railroad bridges, turntables, and similar structures or to walkways beside the tracks in yards or along the right-of-way. These are 3632 Id. (limiting the hours of service certain major categories of employees who are engaged in or connected with railroad operations). 3633 Id. at 10587. 3634 Id. 3635 Id. 3636 Id. 3637 Id.
698 areas which are so much a part of the operating environment that they must be regulated by the agency with primary responsibility for railroad safety.3638 OSHA regulations on egress do not apply to rolling equipment but they do apply to fixed railroad facilities other than including sleeping quarters covered by the Hours of Service Act.3639 OSHA regulations governing powered platforms, manlifts, and vehicle-mounted work platforms do apply to the railroad industry.3640 With a few exceptions, OSHA regulations related to ventilation, occupational noise exposure, and radiation apply to the railroad industry.3641 First, 29 C.F.R. § 1919.94 does not apply to âlocomotive cab or caboose environments, to passenger equipment, or to operational situations in yards or along the right-of-way.â3642 Second, the FRA has exercised its jurisdiction over occupational noise exposure of employees in railroad operations.3643 Third, â[t]he transportation of hazardous materials by rail is governed wholly by Department of Transportation Regulations (Chapter I, Title 49, Code of Federal Regulations).â3644 The OSHA 3638 Id. 3639 Id. at 10587-10588. 3640 Id. at 10588. 3641 Id. 3642 Id. 3643 Id. 3644 Id.
699 regulations only apply in circumstances in which the DOT regulations do not apply, such as the use, handling, and storage of hazardous substances.3645 OSHAâs General Environmental Controls govern sanitation, temporary labor camps, and specifications for accident prevention signs and tags.3646 The regulations on sanitation generally apply to railroad work places.3647 Except those covered by the Hours of Service Act the regulations on temporary labor camps apply to specified facilities.3648 The regulations on color codes for physical hazards apply to hazards other than those arising out of railroad operations.3649 OSHA regulations for accident prevention signs and tags do not cover safety signs for railroads.3650 OSHAâs regulations that are associated with fire protection apply to the railroad industry except to fire protection on rolling stock.3651 OSHAâs regulations relating to compressed gas and compressed air equipment apply except when the DOTâs Hazardous Material Regulations apply or the compressed gas is used in the course of railroad operations.3652 3645 Id. âOSHA regulations concerning personal protective equipment apply according to their terms, except to the extent the general requirements might be read to require protective equipment responsive to hazards growing out of railroad operations.â Id. 3646 Id. 3647 Id. 3648 Id. at 10589. 3649 Id. 3650 Id. 3651 Id. 3652 Id.
700 OSHAâs regulations concerning the handling and storage of materials apply generally with two exceptions. FRAâs policy statement provides, first, that âthe general requirements of 29 C.F.R. § 1910.176 have no application to the operations of railroads in the general system of transportationâ¦.â3653 Second, locomotive trains and other on-track vehicles are governed by the Locomotive Inspection Act.3654 OSHAâs regulations on toxic and hazardous substances are applicable to the railroad industry. However, the shipment or transportation of hazardous materials is governed by the DOTâs Hazardous Materials Regulations. Specific FRA regulations âbearing on the locomotive cab environment address cab ventilation (49 CFR 5230.229(f)(2)) and exhaust gases (49 CFR 5230.259).â3655 Finally, OSHAâs General Industry standards (29 C.F.R. part 1926) apply to the railroad industry except where âworking conditions fall within FRAâs exercise of authority relating to the safety of railroad operations.â3656 E. Facilitating OSHA and FRA Coordination Regarding the Federal Railroad Safety Act and Employee Protection A Memorandum of Agreement (MOA) between the FRA, the DOT, and the OSHA states that [w]hen an individual notifies FRA of alleged discrimination by a railroad carrier for engaging in conduct protected by 49 U.S.C. 20109, FRA will inform the 3653 Id. 3654 Id. 3655 Id. 3656 Id.
701 individual that a personal remedy for discrimination is available through OSHA, rather than FRA, and that the individual should personally contact OSHA.3657 The FRA is required to provide the individual with the appropriate contact information for OSHA and to advise the individual that he or she must file a complaint with OSHA within one hundred and eighty days of the alleged discrimination.3658 OSHA will send the FRA copies of complaints, findings, and orders that OSHA receives or issues under 49 U.S.C. § 20109.3659 The FRA has agreed to support OSHA at OSHAâs request and when both have established procedures to coordinate and support the enforcement of 49 U.S.C. § 20109.3660 Nothing in this MOA is intended to diminish or otherwise affect the authority of either agency to implement its respective statutory functions, including OSHAâs authority under the Occupational Safety and Health Act, 29 U.S.C. 651 et seq., nor is it intended to create any right or benefit, substantive or procedural, enforceable at law by a party against the United States, its agencies, its officers, or any other person.3661 3657 Memorandum of Agreement Between the Federal Railroad Administration, U.S. Department of Transportation, and the Occupational Safety and Health Administration, U.S. Department Of Labor (July 16, 2012), available at: https://www.osha.gov/pls/oshaweb/owadisp.show_document?p_table=MOU&p_id=1125 (last accessed March 31, 2015). 3658 Id. 3659 Id. (stating that â[w]hen, in the course of its investigation of a complaint under 49 U.S.C. 20109, OSHA learns of a potential violation of an FRA accident/incident reporting regulation under 49 CFR Part 225, or other violation of federal railroad safety regulations, OSHA may, to the extent authorized by law, share such information with FRA and provide documentation of the relevant factsâ). 3660 Id. 3661 Id.
702 Cases F. Whether OSHA Regulations are Preempted in a Specific Case Callahan v. National R.R. Passenger Corp.3662 involved a workerâs negligence action against Amtrak after sustaining permanent bodily injury when he fell from a ladder. Amtrak argued that it was error for the trial court to permit an expert witness for the worker to testify regarding certain provisions of the Occupational Safety and Health Act and regulations. Amtrak argued that the OSHA regulations did not apply because the FRAâs policy statement, supra, preempted them. However, the court found no authority to support Amtrakâs argument that the FRA had preempted the OSHA regulations that applied to catenary poles and ladders. However, in affirming the trial courtâs judgment for the work, the Superior Court of Pennsylvania held: Amtrak does not point to any regulation issued by the FRA which relates to catenary poles and ladders, nor has our research discovered same. We simply cannot conclude that OSHA regulations addressing this subject are preempted by the FRA in the absence of any exercise of authority by the FRA in this respect. Such a determination would ignore the express purpose of the FRSA to promote safety in âevery area of railroad operationsâ and reduce accidents.3663 Therefore, the court âreject[ed] Amtrakâs contention that the FRA preempted any and all OSHA regulations in this caseâ¦..â3664 G. Noncompliance with OSHA Regulations may be used as Evidence of Employerâs Negligence 3662 2009 PA Super 132, at *1, 979 A.2d 866, 872 (Pa. Super. Ct. 2009), appeal denied, 2010 Pa. LEXIS 2546 (Pa., Nov. 9, 2010). 3663 Id., 2009 Pa. Super 132, at *14, 979 A.2d at 873. 3664 Id.
703 In CSX Transp., Inc. v. Smith3665 Smith was injured when he slipped while walking up a flight of stairs in CSXâs Terminal Administration Building apparently because of a small amount of soap on the stairs. Smith brought an action against CSX under the Federal Employersâ Liability Act (FELA). Smith appealed after a jury returned a verdict in favor of CSX. The Court of Appeals reversed because the trial court refused to instruct the jury âregarding a federal Occupational Safety and Health Administration (OSHA) stair regulation requiring that â[a]ll treads shall be reasonably slip-resistant and the nosings shall be of nonslip finish.ââ3666 In affirming the judgment of the Court of Appeals, the Supreme Court of Georgia held in accordance with the FRA policy statement that: [T]he OSHA stairway regulations in 29 CFR § 1910.24 apply to railroad office buildings. Moreover, as our discussion above should make clear, the Court of Appeals correctly held that, [i]n the context of 29 CFR Part 1910, the modifier âgeneral industryâ or âgeneral industrialâ plainly denotes that the standard has general application to any workplace and is not limited to certain industries that are subject to additional, particularized standards. â¦. Subpart D, which provides standards for âwalking- working surfaces,â is such a general standard.3667 The trial court, therefore, âshould have given Smithâs request to charge the jury that it could consider a violation of that regulation as evidence of negligence on the part of CSX.â3668 3665 289 Ga. 903, 717 S.E.2d 209 (Ga. 2011). 3666 Id., 289 Ga. at 903, 717 S.E. at 210 (citation omitted). 3667 Id., 289 Ga. at 905, 717 S.E. at 212. 3668 Id., 289 Ga. at 906, 717 S.E. at 212.
704 XXXII. PREEMPTION OF STATE LAWS RELATING TO RAILROADS A. Introduction Because of the railroadsâ importance to interstate commerce, Congress has enacted numerous statutes that regulate the railroad industry and that preempt many state laws in part because of the railroadsâ 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. Section F cross-references this part of the Report to other preemption cases discussed in the Report. Cases B. Recent Preemption Decisions by Federal Courts 1. Claim for Wrongful Termination not Preempted by the Railway Safety Act In Powell v. Union Pac. R.R. Co.3669 the plaintiff Powell sued Union Pacific for a violation of the Federal Employee Liability Act (FELA), for failure to provide a safe working environment in violation of the Federal Railroad Safety Act, and for wrongful termination, eavesdropping, and retaliation.3670 After using a switch in a rail yard, Powell experienced pain in his back that allegedly prevented him from performing the duties of his employment, thus causing Powell to file an injury report.3671 After Union Pacific filmed Powell engaged in activities similar to his duties at work, Union Pacific alleged that Powell falsified his report and commenced an investigative hearing that found Powell to be in violation of Union Pacificâs 3669 864 F. Supp.2d 949 (E.D. Cal. 2012). 3670 Id. at 951. 3671 Id. at 952.
705 Discipline Policy.3672 After Union Pacific terminated Powell after a hearing, Powell appealed his termination to the Railway Labor Board, which denied his petition.3673 A federal district court in California held that the Railway Labor Act did not preempt Powellâs wrongful termination claim because his cause of action was based on state law, not on a right conferred by a collective bargaining agreement.3674 However, the court held that the FRSA preempted Powellâs claim under FELA. The court denied each partyâs motion for a summary judgment on the claim for eavesdropping.3675 The district court later granted Powellâs motion for a summary judgment on the eavesdropping claim and granted Union Pacificâs motion to deny Powell actual and punitive damages; thus, Powell could recover only statutory damages.3676 2. ICCTA Held to Preempt State Antiblocking Statute and Negligence Per Se Claim based on the Statute In 2012 in Elam v. Kansas City S. Ry. Co.,3677 involving a Mississippi statute regulating the amount of time that a train may occupy a crossing, the Fifth Circuit held that the stateâs âantiblocking statute directly attempts to manage KCSRâs switching operations, including KCSRâs decisions as to train speed, length, and scheduling. The statute thus âreach[es] into the area of economic regulation ⦠in a direct way.ââ3678 Thus, the ICCTA preempted the state 3672 Id. 3673 Id. at 952-953. 3674 Id. at 957-959. 3675 Id. at 953, 961. 3676 See Powell v. Union Pacific. R. R. Co., 2012 U.S. Dist. LEXIS 119177 at *19-20 (2012). 3677 635 F.3d 796, 801 (5th Cir. 2011). 3678 Id. at 807 (citation omitted).
706 statute completely.3679 Moreover, because âthe Elamsâ negligence per se claim [was] based solely on Mississippiâs antiblocking statute, it too is completely preempted.â3680 As for the plaintiffsâ simple negligence claims based on KCSRâs alleged failure to provide adequate warnings of the trainâs presence at the crossing at issue, the court stated that the issue was âwhether KCSR has demonstrated that providing such warnings would unreasonably burden or interfere with its switching operations.â3681 KCSR relied on an affidavit to argue that the simple negligence claims were preempted. The appeals court stated that although the affidavit addresses the burdens of Mississippiâs antiblocking statute, it does not address the burdens of providing adequate warnings of the trainâs presence at the Pine Crest Road crossing. We see no apparent reason why providing such warnings would require changes in KCSRâs switching, train length, and crew operations. Second, in any event, the affidavit does not demonstrate that providing adequate warnings at the Pine Crest Road crossing would unreasonably burden or interfere with KCSRâs operations. In the absence of such evidence, we presume Congress did not intend to preempt this âtypical dispute[]â concerning the safety of a âtypical crossing[].â3682 Because KCSRâs affidavit was inadequate, the court reversed and remanded the case to the district court. 3. ICCTA Held not to Preempt Tort Claims under State Law not involving Railroad Transportation of Passengers or Property or Related Services In Emerson v. Kansas City S. Ry. Co.3683 the plaintiffs alleged that Kansas City Southern Railway Co. (KCSR) had discarded railroad ties in a drainage ditch and allowed the ties and 3679 Id. 3680 Id. 3681 Id. at 814. 3682 Id. (citation omitted). 3683 503 F.3d 1126 (10th Cir. 2007).
707 vegetation to impede the flow of water through the ditch and a culvert that resulted in flooding of the plaintiffsâ adjacent properties.3684 KCSR argued that the ICCTA preempted the plaintiffsâ state law claims in tort for trespass, unjust enrichment, public and private nuisance, negligence, and negligence per se.3685 The Tenth Circuit held that the ICCTA could not be read to include the conduct that the Landowners complain of here.⦠These acts (or failures to act) are not instrumentalities âof any kind related to the movement of passengers or propertyâ or âservices related to that movement.â ⦠[T]he ICCTA does not expressly preempt the generally applicable state common law governing the Railroadâs disposal of waste and maintenance of the ditch.3686 The court stated that preemption under these circumstances would be âabsurd,â3687 because such a reading of the ICCTA would mean that a railroad could leave a âdilapidated engine in the middle of Main Street.â3688 However, the appeals court reversed and remanded the case to the district court because federal preemption is an affirmative defense which the defendants have the burden to establish. The appeals court held that to âdecide whether § 10501(b) impliedly preempts application of the Oklahoma tort laws at issueâ the district court must make âa factual assessmentâ on âwhether requiring the Railroad to remedy the injury claimed by the Landowners would have the effect of preventing or unreasonably interfering with railroad transportation.â3689 3684 Id. at 1128. 3685 Id. 3686 Id. at 1130 (citation omitted). 3687 Id. at 1132. 3688 Id. 3689 Id. at 1133, 1134 (citations omitted).
708 4. ICCTA Held to Preempt Vermont Environmental Land Use Statute having a Pre-Construction Permit Requirement In Green Mountain R.R. Corp. v. Vermont3690 the railroad proposed to build transloading facilities on is property in Vermont. At issue in the railroadâs action for a declaratory judgment was whether the ICCTA preempted Vermontâs environmental land use statute, Act 250, Vt. Stat. Ann. Tit. 10, § 601, et seq. as applied to the railroad. Vermont argued that not all state and local regulations are preempted by the ICCTA because states and towns may exercise traditional police powers over the development of railroad property, at least to the extent that the regulations protect public health and safety, are settled and defined, can be obeyed with reasonable certainty, entail no extended or open-ended delays, and can be approved (or rejected) without the exercise of discretion on subjective questions.3691 However, the Second Circuit held that the ICCTA preempted Act 250, because its âpre- construction permit requirement ⦠âunduly interfere[s] with interstate commerce by giving the local body the ability to deny the carrier the right to construct facilities or conduct operations,ââ and because the permit requirement âcan be time-consuming, allowing a local body to delay construction of railroad facilities almost indefinitely.â3692 The court rejected Vermontâs contention that Act 250 was an environmental and not an economic regulation.3693 3690 404 F.3d 638 (2d Cir. 2005), cert. denied, Vt. v. Green Mt. R.R. Corp., 2005 U.S. LEXIS 7869 (U.S., Oct. 31, 2005). 3691 Id. at 643. 3692 Id. (citations omitted). 3693 Id. at 644.
709 5. ICCTA Preempted a City Ordinance Regulating Transportation of Bulk Materials, Including Ethanol In 2008 Norfolk Southern began operating an ethanol transloading facility in Alexandria, Virginia to transfer shipments in bulk of ethanol from its railcars onto surface tank trucks operated by third parties. After Norfolk Southern declined to comply with the cityâs ordinance prohibiting certain materials on its streets, the city amended its ordinance so that it applied to bulk materials including ethanol. A violation of the ordinance constituted a misdemeanor criminal offense.3694 In Norfolk S. Ry Co. v. City of Alexandria3695 the Fourth Circuit held that the ICCTA preempted the cityâs ordinance as it applied to Norfolk Southern.3696 6. No Preemption by the ICCTA of State Law on Minimum Track Clearance In Tyrrell v. Norfolk Southern Railway Co.3697 the Sixth Circuit adopted a narrow interpretation of preemption under the ICCTA in rejecting Norfolk Southernâs argument that the ICCTA preempted a state law regulating minimum track clearances. The court distinguished between economic regulation, which the court stated comes within the scope of the ICCTA, and the STBâs jurisdiction and the regulation of rail safety that is subject to the FRSA.3698 The court in its decision followed other precedents applying the FRSA, which has its own provision on preemption.3699 The court held that âbecause no FRA regulation or action covers the subject 3694 Id. at 155. 3695 608 F.3d 150 (4th Cir. 2010). 3696 Id. at 154. 3697 248 F.3d 517 (6th Cir. 2001). 3698 Id. at 521. See Pub. L. 91-458, 84 Stat. 971 (1970). 3699 See 49 U.S.C. § 20106.
710 matter of minimum track clearance, the Ohio regulation serves as a permissible gap filler in the federal rail safety scheme;â3700 thus, there was no preemption of state law. 7. No Preemption of State Law on Storm Water Runoff The case of MD Mall Associates, LLC v. CSX Transportation, Inc.3701 concerned an appeal by MD Mall Associates, LLC (Mall Associates) of a district courtâs decision that granted a summary judgment in Mall Associatesâ negligence action against CSX for damages that Mall Associates sustained because of a spill of stormwater from CSX property. Mall Associates alleged that CSX violated a federal regulation (49 C.F.R. § 213.33) enacted pursuant to the FRSA that ârequire[d] that CSX manage and control the stormwater occurring on its property.â3702 The Third Circuit stated that [p]ursuant to the previously described 2007 Clarification Amendment to that express preemption provision, even though a federal regulation âcoversâ a state law related to railroad safety, a plaintiff may still bring claims âseeking damages for personal injury, death, or property damageâ when the plaintiff âalleg[es] that a party ... has failed to comply with the Federal standard of care established by a regulation or order issued by the Secretary of Transportation.â3703 The court stated that Mall Associatesâ âclaims are only preserved from preemption if no federal regulation enacted pursuant to the FRSA âcover[s] the subject matter [i.e. storm water runoff] of the State requirement.ââ3704 The court turned next to CSXâs argument that § 213.33 by 3700 Tyrrell, 248 F.3d at 525. 3701 715 F.3d 479 (3d Cir. 2013), cert. denied, CSX Transp., Inc. v. MD Mall Assocs., LLC, 2014 U.S. LEXIS 530 (U.S., Jan. 13, 2014). 3702 Id. at 484. 3703 Id. at 487-488 (citation omitted). 3704 Id. at 488 and N 8 (citation omitted).
711 its terms requires âthat a railroadâs drainage facilities âunder or immediately adjacent toâ the track âbe maintained and kept free of obstruction[]â ⦠preempts Pennsylvania law governing storm water runoff.â3705 However, in rejecting the argument the court stated: A regulation must do more than âtouch upon or relate to [the] subject matterâ of a state law claim; it must âsubstantially subsumeâ it. ⦠We cannot read the silence of § 213.33 on a railroadâs duties to its neighbors when addressing track drainage as an express abrogation of state storm water trespass law. Given that the FRSA provides no express authorization for disposing of drainage onto an adjoining property, the presumption must be that state laws regulating such action surviveâ¦.3706 The court held that the FRSAâs express preemption provision did not apply to Mall Associatesâ claim and therefore vacated the district courtâs grant of a summary judgment in favor of CSX and remanded.3707 8. No Preemption of a State Statute when a Railroad Company Violates a Federal Standard of Care In Zimmerman v. Norfolk S. Corp.3708 the plaintiff Zimmerman, a motorcyclist, brought an action against Norfolk Southern after he was thrown from his motorcycle when attempting to brake to avoid colliding with a train.3709 As a result of the accident, Zimmerman was partially 3705 Id. at 490. 3706 Id. at 491 (citations omitted). 3707 Id. at 495, 497. 3708 706 F.3d 170 (3d Cir. Pa. 2013), cert. denied, 134 S. Ct. 154, 187 L. Ed.2d 41 (2013). 3709 Id. at 174.
712 paralyzed.3710 Zimmerman brought three tort claims under state law against Norfolk Southern.3711 The Third Circuit upheld Zimmermanâs claims for excessive speed and failure to maintain a safe crossing area but held that the FRSA preempted Zimmermanâs claim for negligence per se.3712 Zimmermanâs claim for excessive speed was not preempted because the Norfolk Southern train was travelling at more than twice the speed limit, a violation of the speed limit established by federal law that also gave rise to a federal standard of care.3713 â[B]ecause 49 C.F.R. § 234.245 creates a federal standard of care governing the maintenance of crossbucks,â and because the state statute did not regulate the adequacy of the warning devices used at the crossing, there was no preemption of the claim for a failure to maintain a safe crossing area.3714 However, because the federal regulations at issue did not create a federal standard of care, the negligence per se claim was preempted.3715 The Third Circuit further held that the district court improperly excluded eight crossing reports and nine accident reports.3716 The district court had granted a summary judgment on all of Zimmermanâs claims; however, the Third Circuit reversed the summary judgments for Norfolk Southern on the claims for excessive speed and failure to maintain a safe crossing area but affirmed the lower courtâs 3710 Id. 3711 Id. 3712 Id. at 193. 3713 Id. at 179; see 49 C.F.R. § 213.9. 3714 Id. at 188. 3715 Id. at 192. 3716 Id.180-185.
713 grant of a summary judgment for Norfolk Southern on the negligence per se claim.3717 In 2013, the Supreme Court denied Norfolk Southernâs petition for certiorari.3718 9. Preemption of State Law on Maximum Allowable Speed In CSX Transp., Inc. v. Easterwood3719 the Supreme Court explained the FRSAâs preemption language. The Easterwood Court established a broad interpretation of preemption under the FRSA, holding that the FRSA preempted virtually all causes of action under state law against railroads regarding railroad safety.3720 The Court relied on the explicit preemption language in the FRSA that reads in part:3721 âA state may adopt or continue in force any law, rule, regulation, order, or standard relating to railroad safety until such time as the Secretary has adopted a rule, regulation, order, or standard covering the subject matter of such State requirement.â3722 Because the FRSA established a rule that set the maximum allowable speed, the Court held that federal law preempted the state law. However, as noted by other courts, the Easterwood case, which held that 49 C.F.R. § 213.9 covered the subject matter of claims based on excessive speed, was decided before Congress clarified its position on the preemptive effect of the FRSA.3723 3717 Id. at 193. 3718 Norfolk Southern Corp. v. Zimmerman, 134 S. Ct. 154, 187 L. Ed.2d 41 (2013). 3719 507 U.S. 658, 113 S. Ct. 1732, 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). 3720 Id., 507 U.S. at 664, 113 S. Ct. at 1737, 123 L. Ed.2d at 397. 3721 Id., 507 U.S. at 662, 113 S. Ct. at 1736, 123 L. Ed.2d at 395. 3722 45 U.S.C. § 434 (1970), amended by 49 U.S.C. § 20106(a) (2007). 3723 See Garza v. Norfolk Southern Ry. Co., 2012 U.S. Dist. LEXIS 123011 at *1, 9 (N.D. Ohio 2012) (stating that â[i]n 2007, Congress limited the reach of Easterwood and the FRSA, by enacting a savings
714 10. Whether the ICCTA Preempts a State Statute Requiring a Railroad to Pay for Sidewalks In Adrian & Blissfield R.R. v. Village of Blissfield3724 the Sixth Circuit held that the ICCTA did not preempt a Michigan statute that required a railroad to pay for a pedestrian crossing installed by the village across a railroad companyâs tracks and sidewalks near the railroadâs property.3725 Adrian & Blissfield Railroad Company (A&B), which operated a short- line railroad in the Village of Blissfield, owned about 2.5 miles of track that did not cross state lines.3726 After the village began a program to construct certain sidewalks, the village requested A&B to complete the sidewalk; otherwise, the village would complete it and bill A&B.3727 A&Bâs response was that the ICCTA and the FRSA preempted the state statute pursuant to which the village ordered A&B to complete the sidewalk or pay for its construction.3728 In reversing and remanding the case to the district court, the Sixth Circuit held that the ICCTA did not preempt the Michigan statute because the statute was ânot unreasonably burdensomeâ and did not discriminate against railroads, and the sidewalks were needed for pedestrian safety.3729 clause barring preemption where a state, local, or industry regulation exists[] and does not conflict with the Secretary of Transportationâs regulationâ); Hunter v. Canadian Pac. Ry. Ltd., 2007 U.S. Dist. LEXIS 85110 at *1, 12 (D. Minn. 2007); see 49 U.S.C. §§ 20106(b)-(c) (2014). 3724 550 F.3d 533 (6th Cir. 2008). 3725 Id. at 535, 537 (citing Mich. Comp. Laws S 462.309). 3726 Id. at 535. 3727 Id. at 536. 3728 Id. at 536-538. 3729 Id. at 541-542.
715 C. Recent Preemption Decisions by State Courts 1. ICCTA Preempted Local Model Flood Plain Management Ordinance as Applied to Railroads Village of Big Lake v. BNSF Ry. Co., Inc.3730 was an action by the Village of Big Lake against BNSF and the Missouri Highways and Transportation Commission based on their actions over a 15-year period whereby they raised the height of a rail line and a highway within the village. The village argued that the defendantsâ actions violated the villageâs Model Floodplain Management Ordinance, which the village had enacted as required by the United States National Flood Insurance Program.3731 Under the ordinance any work that affected the flood plain in the village required a hydrological and hydraulic study and the villageâs prior approval of any work. A Missouri appellate court affirmed the trial courtâs dismissal of the case. As the appellate court observed, âseveral courts recognize that the ICCTA preempts most pre- construction or preclearance permit requirements imposed by states and localities.â3732 The court held that â[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. The Ordinance is a form of local permitting or preclearance processâ¦. â[T]he congressional intent to preempt this kind of state and local regulation is explicit in the plain language of the ICCTA and the statutory framework surrounding it.ââ3733 3730 382 S.W.3d 125 (Mo. App. 2012). 3731 Id. at 126. 3732 Id. at 129 (citation omitted. 3733 Id. at 130 (citation omitted).
716 2. ICCTA Held to Preempt Oregon Statute that Prohibited Trains from Blocking Railroad-Highway Grade Crossings for More than Ten Minutes In 2009 in Burlington N. & Santa Fe Ry. Co. v. Depât of Transportation3734 BNSF sought review of an Oregon DOT order that imposed âcivil penalties for violations of OAR 741-125- 0010, which generally prohibits trains from blocking railroad-highway grade crossings for more than 10 minutes.â3735 The DOT argued that the state law was not preempted by the ICCTA because a âstate regulation survives preemption if it does not discriminate against or unreasonably burden rail transportation.â3736 Although the DOT relied on several judicial precedents in support of its position,3737 the Oregon Court of Appeals held that the precedents were inapplicable because the Oregon law was ânot a law of general applicabilityâ but by its express terms an ââoperating ruleâ and a âregulation of rail transportation.ââ3738 3. ICCTA Held to Preempt Railroadâs Breach of Contract Action for Use of Plaintiffâs Railroad Cars on the Defendantsâ Railroad Lines In San Luis Central Railroad Co. v. Springfield Terminal Railway Co.3739 the issue was whether the ICCTA preempted plaintiffâs claims under state law, including a breach of contract 3734 227 Or. App. 468, 206 P.3d 261 (2009), review denied, 347 Ore. 446 (2009). 3735 Id., 227 Or. App. at 470, 206 P.3d at 262. 3736 Id., 227 Or. App. at 471, 206 P.3d at 263. 3737 See id., 227 Or. App. at 472, 206 P.3d at 263 (citing Emerson v. Kansas City Southern Ry. Co., 503 F.3d 1126 (10th Cir. 2007); New York Susquehanna v. Jackson, 500 F.3d 238 (3d Cir. 2007); Green Mountain R.R. Corp. v. Vermont, 404 F.3d 638 (2d Cir. 2005), cert denied, 546 U.S. 977, 126 S. Ct. 547, 163 L. Ed.2d 460 (2005)). 3738 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))). 3739 369 F. Supp.2d 172 (D. Mass. 2005).
717 claim.3740 The San Luis Central Railroad (San Luis Central) brought an action alleging various state-law claims including for breach of contract against defendants3741 for $36,212.54 for the defendantsâ breach of a Car Service and Car Hire Agreement for the use of the plaintiffâs railroad cars on the defendantsâ railroad lines.3742 A federal district court in Massachusetts pointed out that â[t]he STB has the authority to regulate car service, including the compensation paid for the use of freight cars.â3743 The court agreed with the defendants that the plaintiffâs only remedy was to file a complaint with the STB or in federal court and that any state-law remedy was preempted under § 10501(b) of the ICCTA.3744 The court held that the state-law cause of action for breach of the agreement was preempted because the agreement âhas regulatory force and receives continued regulatory oversight.â3745 The court also held that the tort claim for conversion was preempted.3746 4. No Preemption of a State Statute on Eminent Domain that does not Regulate Railroad Transportation In Norfolk Southern Ry. Co. v. Intermodal Props., L.L.C.,3747 Intermodal Properties, L.L.C. (Intermodal) owned 5.88 acres of property in Secaucus, New Jersey that were adjacent to 3740 Id. at 173. 3741 Springfield Terminal Railway Company, Maine Central Railroad Company, Boston and Maine Corporation, and Portland Terminal Company. 3742 San Luis Central Railroad Co., 369 F. Supp.2d at 173. 3743 Id. at 174 (citing 49 U.S.C. § 11122(a)). 3744 Id. at 175-176. 3745 Id. at 176. 3746 Id. at 177. The court, however, did grant the plaintiffs leave to file an amended complaint. 3747 424 N.J. Super. 106, 35 A.3d 726 (App. Div. 2012), affâd, Norfolk Southern Ry. Co. v. Intermodal Properties, LLC, 215 N.J. 142, 71 A.3d 830, 2013 N.J. LEXIS 818 (2013).
718 more than 240 acres of land owned by Norfolk Southern.3748 After Intermodal rejected several offers by Norfolk Southern to purchase Intermodalâs property, Norfolk Southern filed a petition with the NJDOT to acquire Intermodalâs property through eminent domain.3749 An administrative law judge (ALJ) granted permission to Norfolk Southern to acquire the property and held that the ICCTA preempted the provision for on-site accommodation in N.J. Stat. Ann. § 48:12-35.1.3750 The on-site accommodation provision requires a railroad to show that âalternative property suitable for the specific proposed use of the property ... is unavailable ... through on-site accommodation....â3751 The state court held that the ICCTA did not preempt New Jerseyâs eminent domain statute, because the statute did ânot constitute the regulation of railroad transportation.â3752 The court reversed the ALJâs decision that the ICCTA preempted § 48:12-35.1 and remanded the case.3753 5. State Claims for Damages not Preempted for Breach of Contract or Breach of a Covenant Granting an Easement In PCS Phosphate Co. v. Norfolk Southern Corp.3754 the Fourth Circuit held that the ICCTA, 49 U.S.C. § 10501, does not expressly preempt claims for breach of contract or breach 3748 Id., 424 N.J. Super. at 113, 35 A.3d at 729-730. 3749 Id. 3750 Id., 424 N.J. Super. at 115, 35 A.3d at 731. 3751 Id., 424 N.J. Super. at 124, 35 A.3d at 736. 3752 Id., 424 N.J. Super. at 128, 35 A.3d at 739. 3753 Id., 424 N.J. Super. at 129, 35 A.3d at 739. 3754 559 F.3d 212, 217-219 (4th Cir. 2009).
719 of a covenant granting an easement because the statute applies to regulatory acts and because voluntary agreements between two private parties presumptively are not regulatory acts. When determining whether § 10501 impliedly preempts claims for breach of contract and for breach of a covenant granting an easement, the Fourth Circuit applied the âthe generally accepted test for ICCTA implied or conflict preemption: does the enforcement action âunreasonably interfer[e]â with rail transportation?â3755 The Board has recognized that voluntary agreements âreflect[] the carrierâs own determination and admission that the agreements would not unreasonably interfere with interstate commerce.â3756 Because the claims were not expressly or impliedly preempted by § 10501, remedies and damages under state law were available.3757 Therefore, the Fourth Circuit affirmed the judgment of the district court.3758 D. Recent Preemption Decisions by the STB 1. ICCTA Preemption of Local Permitting or Preclearance Requirements In Grafton and Upton Railroad Company3759 Grafton and Upton (G&U) sought to build a transloading facility on a parcel of land in North Grafton adjacent to G&Uâs line and existing rail yard. The new facility would be used to transfer propane received by tank cars that would be stored and later transferred to trucks for delivery. Relying on its municipal zoning and 3755 Id. at 220-221 (stating that it is a fact specific assessment) (citations omitted). 3756 Id. at 221 (citations omitted). 3757 Id. at 220. 3758 Id. at 224. 3759 Grafton & Upton Railroad Co. â 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 March 31, 2015).
720 permitting ordinances, the town of Grafton, Massachusetts issued a cease and desist order against the construction of the facility.3760 The town also filed a complaint in the Superior Court for Worcester County, Massachusetts, which stayed its decision pending the STBâs ruling on ICCTA preemption. The dispute between the parties was âwhether the proposed transload facility would be part of G&Uâs transportation by rail carrier entitled to federal preemption, or rather a third- party transload operation run by non-railroads that may be regulated by states and localities.â3761 Although the STB has jurisdiction to determine issues of preemption relating to the regulation of railroads, the activities at issue must âconstitute âtransportationâ and must be performed by, or under the auspices of, a ârail carrier.ââ3762 The Board generally considers six factors when determining whether transloading activities are within the Boardâs jurisdiction or are a part of an independent business.3763 (1) Whether the rail carrier holds itself out as providing transloading service; (2) whether the rail carrier is contractually liable for damage to the shipment during loading or unloading; (3) whether the rail carrier owns the transloading facility; (4) whether any third party that performs the physical transloading receives compensation from the rail carrier or the shipper; (5) the degree of control retained by the rail carrier over the third party; and (6) other terms of the contract between the rail carrier and third party.3764 Based on the contracts G&U signed with third parties and on its financing plans, the STB determined that G&Uâs proposed transloading facility was to be an âintegral part of its 3760 Id. at 2. 3761 Id. at 4. 3762 Id. at 5 (citation omitted). 3763 Id. 3764 Id. at 6.
721 operations as a rail carrier.â3765 Therefore, the Board concluded that the facility would constitute transportation by rail carrier under the ICCTA, thus qualifying for federal preemption of the local permitting or preclearance requirements.3766 The Board granted Grafton & Uptonâs petition for a declaratory order that the local permitting ordinance was preempted by federal law.3767 2. ICCTA Preemption of Local Zoning Ordinance and Order In Boston and Maine Corporation and Springfield Terminal Railroad Company,3768 the petitioning railroad used a set of tracks and a warehouse located in the town of Winchester, Massachusetts. The residents living near the warehouse complained to the zoning board about noise caused by trains âcoupling and switching at night.â3769 After the zoning board directed all traffic to the warehouse to cease and desist, the railroad appealed to the STB. The STB emphasized that the ICCTA, which âprovides that the jurisdiction of the Board over transportation by rail carriers is exclusive,â defines the term transportation broadly so as to encompass any property or facility related to the operation of railroads.3770 Furthermore, preemption under the ICCTA is designed to prevent localitiesâ regulations from interfering with interstate commerce. Thus, âstate or local permitting or preclearance requirements, including 3765 Id. at 8. 3766 Id. 3767 Id. at 9. 3768 Boston & Maine Corp. â Pet. for Declaratory Order, FD 35749, slip op. (STB decided July 19, 2013), available at: http://www.stb.dot.gov/decisions/ReadingRoom.nsf/UNID/43B8F53F6BF4C92185257BAD006B2D2C/$ file/43203.pdf (last accessed March 31, 2015). 3769 Id. at 2. 3770 Id. at 3 (citation omitted).
722 building permits, zoning ordinances, and environmental and land use permitting requirements are preempted.â3771 In this case, because a town zoning ordinance decreed that a warehouse was not allowed to operate as a freight yard, the town ordered all rail traffic to the warehouse to cease. However, the STB ruled that â[s]uch an attempt to prohibit common carrier rail transportation directly conflicts with the most fundamental common carrier rights and obligations provided by federal law and the Boardâs exclusive jurisdiction over that service. The Townâs actions [were] therefore plainly preempted by § 10501(b) [of the ICCTA].â3772 The STB granted the petitionerâs request for a declaratory order allowing the continuation of freight rail transportation to the warehouse in Winchester.3773 3. Preemption of State Tort Claims Arising out of Railroadâs Action 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,3774 the petitioners filed suit against BNSF in Holt County, Missouri. They sought compensation for property damage that BNSF allegedly caused in connection with a flood that damaged the petitionersâ property. The petitioners, who had initiated an action in state court asserting tort claims under state law, petitioned the STB to declare that âtheir state court claims against BNSF 3771 Id. 3772 Id. at 4. 3773 Id. at 5. 3774 Thomas Tubbs - Pet. for Declaratory Order, FD 35792, slip op. (STB served Oct. 29, 2014), available at: http://www.stb.dot.gov/decisions/readingroom.nsf/UNID/2C4E7A01A148E0A385257D8200477BE9/$fil e/43738.pdf (last accessed March 31, 2015).
723 are not federally preempted.â3775 A section of BNSFâs track was situated above an embankment adjacent to the petitionersâ property. Although BNSF had fortified the embankment âby placing rock, rip-rap, and other material tracksideâ in anticipation of flooding by the Missouri River, the embankment had not prevented the flooding of the petitionersâ farm.3776 According to the petitioners âthe soil on their farm was washed away, rendering their property virtually worthless.â3777 The petitioners alleged that BNSF constructed the embankment without proper drainage and that breaches in the embankment channeled floodwater onto their property.3778 The petitioners sought a declaration that their claims were not preempted by federal law and that, therefore, they could proceed with their state law claims for damages.3779 The STB observed that the ICCTA granted it âbroad and exclusive jurisdiction over transportation by rail carrierâ and that the broad definition of transportation includes any âproperty, facility, structure or equipmentâ related to the operation of a railroad.3780 The Board noted that § 10501(b) of the ICCTA grants the STB regulatory, preemptory power over states or localities that attempt to intrude into matters that are subject to the STBâs authority. The STB stated that if categorical preemption did not apply âstate and local actions may be preempted âas 3775 Id. at 1. 3776 Id. at 2. 3777 Id. 3778 Id. 3779 Id. 3780 Id. at 3.
724 appliedâ â that is, if they would have the effect of unreasonably burdening or interfering with rail transportation.â3781 Even though the petitionersâ claims were tort claims under state law, the claims arose out of the construction and maintenance of BNSFâs tracks. The tracks are subject to the Boardâs exclusive jurisdiction âbecause damages awarded under state tort laws can manage or regulate a railroad as effectively as the application of any other type of state statute or regulation.â3782 The Board concluded that the petitionersâ state law claims were preempted under the ICCTA. However, the Board declared that the Petitionersâ claims that BNSF violated certain federal regulations under the Federal Railroad Safety Act regarding drainage under railroad tracks were not preempted under the ICCTA. Thus, any tort claims arising out of the alleged violations also were not preempted by the ICCTA.3783 The Board granted the petitionersâ request in part for a declaratory order. E. Preemption Cases Summarized Elsewhere in the Report 1. Federal Cases a. Carmack Amendmentâs Preemption of State Claims The Carmack Amendment bars all claims that would permit a railroad to be held liable under state law.3784 See part V.C.1. b. FELAâs Preemption of Actions under State Law In New York Central Rail Company v. Winfield3785 the Supreme Court held that FELA precluded an employee from claiming damages under state law. See part XXI.D.6. 3781 Id. at 4. 3782 Id. 3783 Id. at 7. 3784 Gulf Rice Arkansas, LLC v. Union Pacific R.R. Co., 376 F. Supp.2d 715, 719 (S.D. Tex. 2005).
725 c. FRSAâs Preemption of Local Regulation of Transportation of Hazardous Material In CSX Transportation, Inc. v. Williams3786 the District of Columbia Circuit held that the FRSA preempted the District of Columbiaâs Terrorism Prevention in Hazardous Materials Transportation Emergency Act of 2005. See part XX.D.4. d. ICCTAâs Preemption of Antitrust Claims under State Law In Fayus Enterprises v. BNSF Railway Co.3787 the District of Columbia Circuit held that the ICCTA preempted antitrust claims under state law. See part X.C.7. e. Local Air Quality Regulations Preempted In Association of American Railroads v. South Coast Air Quality Management District3788 the Ninth Circuit held that federal law preempted certain local air quality regulations. See part XXXIX.G. f. Negligence Claim Relating to Service Preempted but a Claim for Negligent Design of a Railcar not Preempted In Rubietta v. Amtrak3789 the court held that the plaintiffâs claim for negligent seating was preempted because the claim related to service but that a claim based on alleged negligent design was not preempted. See part III.G. g. Obstruction to Visibility Claim not Preempted In Strozyk v. Norfolk S. Corp.3790 the Third Circuit held that federal regulations did not preempt the plaintiffâs claim based on an obstruction to visibility. See part XIV.E.6. 3785 244 U.S. 147, 148, 153-154, 37 S. Ct. 546, 548, 549, 61 L. Ed. 1045, 1048-1049 (1917). 3786 406 F.3d 667, 669 (D.C. Cir. 2005). 3787 602 F.3d 444 (D.C. Cir. 2010). 3788 622 F.3d 1094 (9th Cir. 2010). 3789 2012 U.S. Dist. LEXIS 12047, at *1, 9-11, 12 (N.D. Ill. Jan. 30, 2012). 3790 358 F.3d 268 (3d Cir. 2004).
726 h. Preemption by the FRSA Inapplicable when a Railroad Violates a Federal Safety Standard of Care In Sanchez v. BNSF Railway Company3791 a federal court in New Mexico explained that FRSA preemption does not apply when a railroad violates a federal safety standard of care. See part XXIII.D. i. Preemption of an Action in State Court for Damages Caused by Abandonment of a Rail Line In Chicago & N.W. Transp. Co. v. Kalo Brick & Tile Co.3792 the Supreme Court held that the Interstate Commerce Act precludes a shipperâs action in state court for damages against a carrier when the ICC in approving the carrierâs application for abandonment âreaches the merits of the matters the shipper seeks to raise in state court.â3793 See part I.B.7. j. Preemption of Claims under State Law Alleging Defective Warning Devices by the FRSA In Norfolk S. Ry. Co. v. Shanklin3794 the Supreme Court held that the FRSA preempts claims under state law alleging defective devices at crossings when the state has used federal funds to install devices at a crossing. See part XIV.E.2. k. Preemption of Condemnation of Leased Railroad Property to Avoid Leasing the Property In Union Pac. R. Co. v. Chicago Transit Auth.,3795 when the Chicago Transit Authority attempted to condemn leased railroad property and retain a permanent easement to avoid paying high rents to the railroad-lessor, the Seventh Circuit held that the condemnation amounted to regulation that interfered with railroad transportation and, thus, was preempted by the ICCTA. See part XIII.D.3. 3791 2013 U.S. Dist. LEXIS 147656, at *1, 13, 14 (D. N.M. 2013). 3792 450 U.S. 311, 101 S. Ct. 1124, 67 L. Ed.2d 258 (1981). 3793 Id., 450 U.S. at 322-323, 101 S. Ct. at 1132-1133, 67 L. Ed.2d 258. 3794 Norfolk S. Ry. Co. v. Shanklin, 529 U.S. 344, 358-359, 120 S. Ct. 1467, 146 L.Ed.2d 374 (2000). 3795 647 F.3d 675, 682 (7th Cir. 2011).
727 l. Preemption of Deed Requiring Amtrak to Maintain a Bridge in Perpetuity In City of New York v. Amtrak3796 a federal district court in the District of Columbia held that Amtrak was not obligated by reason of a 1906 deed to maintain the bridge in dispute in perpetuity because any such agreement was preempted by federal law. See part III.F. m. Preemption of Employeeâs FELA Claims by the FRSA and the Locomotive Inspection Act Garza v. Norfolk Southern Ry. Co.3797 the Sixth Circuit held that the FRSA and the Locomotive Inspection Act (LIA) preempted the engineerâs claims for injuries sustained when an automobile drove through a railroad crossing striking a Norfolk Southern train on which Garza was working. See part XXVIII.C.2. n. Preemption of State Statutes Requiring Full Crews In Burlington N. & Santa Fe Ry. Co. v. Doyle3798 the Seventh Circuit ruled that federal law preempted some provisions of a Wisconsin law requiring full crews on trains. See part XI.C.1. o. FRSAâs Preemption of State and Local Railroad Laws In Driesen v. Iowa, Chi. & E. R. R. Corp.3799 a federal district court in Iowa held that the FRSA preempted state and local laws regulating the speed of trains, reflectorization of railcars, warning devices, and locomotive horns. See part XXVIII.C.3. p. State Law applicable to Railroad Crossing Preempted by the FRSA In Cook v. CSX Transportation, Inc.3800 a federal district court in Ohio held that an Ohio law applicable to railroad crossings was preempted by the FRSA. See part XIV.H.5. 3796 960 F. Supp.2d 84, 90, 94-95 (D.D.C. 2013). 3797 2013 U.S. App. LEXIS 17134, at *1 (6th Cir. 2013). 3798 186 F.3d 790, 804-805 (7th Cir. 1999). 3799 777 F. Supp.2d 1143, 1160 (N. D. Iowa 2011). 3800 2014 U.S. Dist. LEXIS 147661, at *1 (N.D. Ohio 2014).
728 q. State Law on Agreements in Construction Contracts Preempted by Federal Law In O&G Industries, Inc. v. Amtrak3801 the Second Circuit held that 49 U.S.C. § 28103(b) preempted a Connecticut law banning indemnity agreements in a construction contract when the agreement indemnified a party for acts caused by its own negligence. See part XXVI.G.1. r. State Law on Indemnity Agreements not Preempted by 49 U.S.C. § 28103 In CSX Transportation, Inc. v. Massachusetts Bay Transportation Authority3802 a federal district court in Massachusetts ruled that 49 U.S.C. § 28103(b), which allows railroads to enter into indemnification agreements, did not preempt a Massachusetts law that prohibited a party from indemnifying another party for injuries or damage caused by gross negligence or recklessness. See part XXVI.G.1. s. State Law Preempted by Installation of Federally Funded Signals In Illinois Central Railroad Company v. Daniel3803 a federal district court in Mississippi held that federal law preempted a state law because federally funded signals had been installed at the crossing. See part XXIX.H.1. 2. State Cases a. Alleged Conditions at Crossing Preempted by the FRSA In Boyd v. National R.R. Passenger Corp.,3804 although the issue was not before the Supreme Judicial Court of Massachusetts, the court noted that the Court of Appeals had held that the FRSA preempted the plaintiffâs state law claims because the conditions at the crossing did not qualify as a local hazard under the savings clause. See part XXIII.C. 3801 537 F.3d 153 (2d Cir. 2008). 3802 697 F. Supp.2d 213 (D. Mass. 2010). 3803 901 F. Supp.2d 790 (S.D. Miss. 2012). 3804 446 Mass. 540, 549, 845 N.E.2d 356, 365 (Sup. J. Ct. Mass. 2006).
729 b. Occupational Safety and Health Administration Regulations applicable to Catenary Poles and Ladders not Preempted In Callahan v. National R.R. Passenger Corp.3805 the court stated that it could find no authority to support Amtrakâs argument that the FRA had preempted OSHA regulations that applied to catenary poles and ladders. See part XXX1.F. c. Preemption of Claims that Warning Devices were Inadequate In Murrell v. Union Pacific Railroad Company3806 a federal district court in Oregon held that federal law preempted the plaintiffâs claims that there were inadequate warning devices. See part XXIX.H.2. d. State Administrative Procedures that come within Preemption Exemption In BNSF Railway Company v. Arizona Corporation Commission3807 the Arizona Court of Appeals held that the Arizona Corporation Commissionâs action to investigate and approve or deny installation of modifications to crossings was an administrative procedure that came within the preemption exemption. See part XXXIV.G. e. State Law on Riparian Rights not Preempted In Miller v. SEPTA3808 the Supreme Court of Pennsylvania held that the stateâs law on riparian rights was not preempted by the FRSA, nor by § 213.33 of the federal Track Safety Standards regulations. See part VI.D.2. f. State Law that Applied to Crossings not Preempted because Federal Regulations had not been Issued In Langemo v. Montana Rail Link, Inc.3809 the court held that that 49 U.S.C. § 20153, enacted in 1994, did not preempt state law because the federally required regulations applicable to locomotive horns when approaching and entering public highway-rail grade crossings were not in effect at the time of the accident. See part XIV.E.7. 3805 2009 PA Super 132, at *1, 979 A.2d 866, 872 (Pa. Super. Ct. 2009) (quoting 29 U.S.C. § 653(b)(1)), appeal denied, 2010 Pa. LEXIS 2546 (Pa., Nov. 9, 2010). 3806 544 F. Supp.2d 1138, 1152 (D. Or. 2008). 3807 268 P.3d 1138 (Ariz. Ct. App. 2012). 3808 103 A.3d 1225 (Pa. 2014). 3809 2001 ML 370, 2001 Mont. Dist. LEXIS 2131, at *1 (Mont. First Jud. Ct. 2001).
730 XXXIII. PUBLIC SERVICE COMMISSIONS A. Introduction Based on the police power of states to protect their citizens,3810 all states have established Public Service Commissions (PSC), Public Utilities Commissions (PUC), or the equivalent to regulate public service corporations that furnish services to their residents, such as electricity, gas, and transportation.3811 The commissions seek to protect residents through the publication of safety standards and the avoidance of wasteful spending and the imposition of undue burdens on public service corporations.3812 However, in the railroad sector, because of federal laws and regulations that preempt state laws that conflict with or overlap federal law, the state commissionsâ duties are more limited.3813 Preemption may leave the commissions only with the responsibilities of representing the stateâs rail interests before federal agencies and conducting negotiations with rail carriers and the Surface Transportation Board (STB) or with landowners. Nevertheless, as discussed in section B states may participate in the investigation and enforcement of federal railroad safety laws and regulations. Sections C through H discuss commissions in California, Florida, Illinois, North Dakota, West Virginia, and Wisconsin. Section I discusses the Illinois Commerce Commission (ICC). Section J discusses whether Amtrak is exempt from natural gas taxes that were passed on to Amtrak by the supplier. Section 3810 See U.S. Const. amend. X. 3811 12 McQuillin Mun. Corp. § 34:9 (3d ed.). 3812 Id. 3813 Interstate Commerce Commission Termination Act of 1995 (ICCTA), PL 104â88, 109 Stat. 803 (codified as amended in scattered sections of title 49 of the United States Code); Hazardous Materials Safety Act (HMSA), Pub. L. 93-633, 88 Stat. 2156 (Jan. 3, 1975) (codified as amended at 49 U.S.C. §§ 5101-5128 (2014)); and the Federal Railroad Safety Act, Pub. L. 91-458, 84 Stat. 971 (Oct. 16, 1970) (codified as amended at 49 U.S.C. §§ 20101-21311 (2014)).
731 K analyzes whether a PUC or the Surface Transportation Board (STB) has jurisdiction over the installation of new railroad bridges prior to charging railroads for their construction. Section K discusses a case in which it was held that a PUC may not authorize a change in audible devices that is contrary to federal statutory authority. Statutes and Regulations B. State Enforcement of Federal Railroad Safety Regulations As the New Mexico Public Regulation Commission states, â[s]ince 1970, the federal government has preempted state railroad safety regulation. However, the federal government through the Federal Railroad Administration (âFRAâ) offers states the opportunity to participate in federal investigative and enforcement activities.â3814 Part 212 of the Code of Federal Regulations (C.F.R.) âestablishes standards and procedures for State participation in investigative and surveillance activities under the Federal railroad safety laws and regulations.â3815 As stated in § 212.105, the principal method of federal- state cooperation is through an agreement between the FRA and a state either for a fixed term or an indefinite duration.3816 Section 212.105(d) sets forth the common terms for such an agreement. Section 212.201 specifies the general qualifications required of state inspection personnel with the sections that follow addressing specific types of inspectors, such as for track, locomotives, cars, operating practices, and highway-rail grade crossings. 3814 New Mexico Public Regulation Commission, Transportation-Railroad, available at: http://www.nmprc.state.nm.us/transportation/railroad.html (last accessed March 31, 2015). 3815 49 C.F.R. § 212.1 (2014). 3816 49 C.F.R. § 212.105(a) and (b) (2014).
732 C. California Public Utilities Commission The California the California Public Utilities Commission (CPUC), which supervises and regulates every public utility in California,3817 âmay establish rates or charges for the transportation of passengers and freight by railroads and other transportation companies.â3818 The commission must give its consent before any road may be built across any railroad track, and a railroad company must receive the Commissionâs consent to construct a railroad track across any road.3819 The CPUC also has the authority in consultation with the DOT to âadopt rules and regulations prescribing uniform standards regarding the time after the warning signal begins at the railroad crossing at which traffic enforcement shall begin.â3820 The CPUC may determine the amount of just compensation to be awarded for property or any interest in property that is taken or damaged in the separation of grades at any crossing and the construction, alteration, or relocation of elevated tracks.3821 In CUPC âis responsible for inspection, surveillance, and investigation of the rights-of-way, facilities, equipment, and operations of railroads,â as well as public mass transit guideways; its ârail inspectors are federally-certified to enforce state and federal laws, regulations, orders, and directives pertaining to rail transportation.â3822 The CPUC is authorized to hire a minimum of six additional rail 3817 Cal. Pub. Util. Code § 701 (2014) 3818 Cal. Pub. Util. Code § 728.5 (2014). 3819 Cal. Pub. Util. Code § 1201 (2014). 3820 Cal. Pub. Util. Code § 1201.1 (2014). 3821 Cal. Pub. Util. Code § 1206 (2014). 3822 California Public Utilities Commission, ROSB Regulatory Authority, Rules, and Regulations, available at:
733 inspectors to enforce compliance with state and federal safety regulations in the state.3823 The CPUC inspects railroad yards and tracks that pose the greatest safety hazard.3824 The CPUC is empowered to order more railroad trains or cars to meet the demands of rail traffic.3825 D. Florida Public Service Commission The Florida Public Service Commission (FPSC) has jurisdiction over telecommunications, water and water waste, and gas utilities.3826 In 1985 when the railroad industry was deregulated the FPUC ceased having jurisdiction over railroads.3827 The FPSCâs website states that its mission is the facilitation of safe and reliable utility services at fair prices.3828 E. Illinois Commerce Commission The Illinois Commerce Commission (ICC) supervises all public utilities in Illinois, including telecommunications, natural gas, electric, water and sewer, transportation, and cable and video.3829 The ICCâs jurisdiction is âexclusive and shall extend to all intrastate and interstate rail carrier operations within the State, except to the extent that its jurisdiction is preempted by http://www.cpuc.ca.gov/PUC/safety/Rail/Railroad/ROSB_Regulatory_Authority_Rules_and_Regulations .htm (last accessed March 31, 2015). 3823 Cal. Pub. Util. Code § 765.5(c) (2014). 3824 Cal. Pub. Util. Code § 765.5(e) (2014). 3825 Cal. Pub. Util. Code § 763(a) (2014). 3826 Fla. Stat. §§ 364.01(2), 367.011, 368.05(1) (2014). 3827 Florida Public Service Commission, available at: http://www.floridapsc.com/about/history.aspx (last accessed March 31, 2015). 3828 Florida Public Service Commission, available at: http://www.psc.state.fl.us/home/files/SAOO.pdf (last accessed March 31, 2015). 3829 220 Ill. Comp. Stat. 5/4-101 (2014).
734 valid provisions of the Staggers Rail Act of 1980.â3830 The ICC has jurisdiction to enforce and administer laws establishing general safety requirements for railroad track, facilities, and equipment in Illinois.3831 The ICC requires railroad carriers to register with the ICC to operate in Illinois and requires registration to begin or to continue construction of any railroad tracks or facilities.3832 Under the Illinois Commercial Transportation Law, enforced by the ICC, rail carriers are required to provide adequate service at reasonable rates without discrimination.3833 No public roads may be built across a railroad track, nor may a railroad track be constructed across a public road, without the ICCâs prior permission.3834 The ICC investigates all railroad accidents reported to the Commission.3835 Finally, the ICC implements a railroad safety education program, the Illinois Operation Livesaver.3836 F. North Dakota State Public Service Commission Various statutes define the mission and powers of the North Dakota State Public Service Commission over the stateâs public utilities.3837 The Commission has limited power over the railroad industry because of the ICCTAâs preemption of certain state laws and regulations as 3830 625 Ill. Comp. Stat. 5/18c-701 (2014). 3831 Illinois Commerce Commission, available at: http://www.icc.illinois.gov/railroad/ (last accessed March 31, 2015). 3832 625 Ill. Comp. Stat. 5/18/c-7201(1) (2014). 3833 625 Ill. Com. Stat. 5/18c-7202 (2014). 3834 625 Ill. Com. Stat. 5/18c-7401(3) (2014). 3835 625 Ill. Com. Stat. 5/18c-7402(3)(b) (2014). 3836 Illinois Commerce Commission, available at: http://www.icc.illinois.gov/railroad/ (last accessed March 31, 2015). 3837 North Dakota Public Service Commission, available at: http://www.psc.nd.gov/ (last accessed March 31, 2015). See N.D. Cent. Code, §§ 49-02-01, 49-02-01.1, 49-02-02, 49-02-03, and 49-02-04 (2014).
735 discussed elsewhere in the Report.3838 However, the Commission continues to represent the stateâs interest before federal agencies and may enter into negotiations with rail carriers that conduct business in the state.3839 The Commission has jurisdiction over the rights of landowners in North Dakota, such as fencing along railroad rights-of-way, the sale of land adjacent to abandoned railroad rights of way, and leasing rates on property owned by railroads.3840 G. West Virginia Public Service Commission The West Virginia Public Service Commissionâs railroad safety section in the transportation enforcement division is responsible for administering federal and state safety regulations that govern rail transportation.3841 The public safety section conducts inspections and enforces regulations that apply to the railroad industry in the state.3842 One responsibility of the Commission is to promote safe rail services. For example, the Commission conducts an annual railroad safety camp for children in West Virginia through the nonprofit West Virginia Operation Livesaver to teach safe conduct when approaching grade crossings.3843 3838 N.D. Cent. Code § 10.1-01 (2014). 3839 Id. 3840 North Dakota Public Service Commission, Jurisdiction: Railroad, available at: http://www.psc.nd.gov/jurisdiction/railroad/index.php (last accessed March 31, 2015). See N.D. Cent. Code, §§ 49-09-04, 49-09-04.1, 49-09-11, and 49-11-24 (2014). 3841 Public Service Commission of West Virginia, Transportation Administration Division, available at: http://www.psc.state.wv.us/div/trans.htm (last accessed March 31, 2015). See W. VA. Code §§ 24-2-1 and 24-2-1a (2014). 3842 Public Service Commission of West Virginia, Mission and Vision Statements, available at: http://www.psc.state.wv.us/missionstatement.htm. See W. Va. Code § 22-18-7(b) (2014) (last accessed March 31, 2015). 3843 Public Service Commission of West Virginia, Transportation Administration Division, available at: http://www.psc.state.wv.us/div/trans.htm (last accessed March 31, 2015).
736 H. Wisconsin Public Service Commission The Public Service Commission of Wisconsin, an independent agency pledged to serve the public interest, regulates Wisconsinâs public utilities.3844 However, the STB regulates railroad rates and services and thus preempts the stateâs regulation of rates and services.3845 The Commission retains jurisdiction to enforce federal regulations that apply to railroad services and to conduct fact-finding investigations on railroad practices. The Commission represents the interests of the state and its residents before the STB. The Commission promotes safe and reliable rail services by submitting written comments in response to a notice of proposed rulemaking by the STB. For example, in September 2007, the Commission, in collaboration with a coalition of utilities, agriculture, and manufacturing industries, hosted a forum with the Chair of the STB to call for reforms of the nationâs railroad services that would increase the reliability and affordability of railroad service.3846 Since the forum, the STB penalized the Union Pacific Railroad and the Burlington Northern Santa Fe Railways by requiring them to pay reparations and reduce rates because of overcharging captive utilities in the coal industry.3847 3844 Public Service Commission of Wisconsin, PSC Overview, available at: http://psc.wi.gov/aboutUs/organization/PSCoverview.htm. See Wis. Stat. § 196.02(1) (2014) (last accessed March 31, 2015). 3845 Public Service Commission of Wisconsin, Rail Service in Wisconsin, available at: http://psc.wi.gov/initiatives/railService/railService.htm. See 49 U.S.C. § 10501(b) (2014) (last accessed March 31, 2015). 3846 E.g., the Wisconsin Department of Agriculture, Trade and Consumer Protection (DATCP), and Badger-Cure, a coalition of utilities, agriculture, and others interested in freight rail shipping rates. See Public Service Commission of Wisconsin, Rail Service in Wisconsin, available at: http://psc.wi.gov/initiatives/railService/railService.htm (last accessed March 31, 2015). 3847 Public Service Commission of Wisconsin, Rail Service in Wisconsin, available at: http://psc.wi.gov/initiatives/railService/railService.htm (last accessed March 31, 2015). See Western Fuels Association, Inc., and Basin Electric Power Cooperative v. BNSF Railway Co., STB Docket No. 42088 (2009); and United States Magnesium, L.L.C. v. Union Pacific Railroad Co., STB Docket No.42114.
737 Cases I. Whether a PUC or the STB has Jurisdiction over the Installation of New Railroad Bridges prior to charging Railroads for their Construction In Union Pacific R.R. Co. v. City of Des Plaines,3848 an Illinois federal district court, in granting the city of Des Plainesâ motion to dismiss, held that the Illinois Commerce Commission had jurisdiction over the matter in dispute.3849 The Illinois Department of Transportation and the city of Des Plaines planned to straighten Route 14 in Des Plaines but to complete the task a railroad bridge needed to be replaced with two new bridges.3850 Although Union Pacific offered to repair the current bridge, it refused to pay the suggested two-thirds of the cost for new bridges because they were part of a highway project, not a railroad project, and because the STB preempted the state ICCâs jurisdiction.3851 Union Pacific sought a declaratory judgment to avoid paying the cost of the bridges and an injunction to prevent Des Plaines from petitioning the ICC.3852 The court held that 49 U.S.C. § 20106 precluded declaratory and injunctive relief, because the ICC would have to determine whether a local safety or security hazard was present before determining whether Union Pacific could be required to pay for the bridges.3853 Although 3848 2003 U.S. Dist. LEXIS 20615, at *1 (N.D. Ill. 2003). 3849 Id. at *6-7. 3850 Id. at *1. 3851 Id. at *1-2. 3852 Id. at *4 (citing 49 U.S.C. § 10501(b)(2)). 3853 Id. at *6. Section 20106 permits a state to adopt a railroad law that is necessary to eliminate or reduce a local safety or security hazard.
738 the city filed a petition on December 16, 2003, the petition was dismissed without prejudice on August 16, 2006. The reason was that the parties did not want the case to remain on the ICCâs docket while the city continued to search for funding for the highway portion of the project.3854 J. Whether a Public Utility Commission may Authorize a Change in Audible Devices that are Contrary to Federal Law In BNSF Railway Co. v. Public Utility Commission3855 a California appellate court held that the defendant California Public Utility Commission or CPUC did not have âthe authority to order railroads to stop using locomotive-mounted horns at certain pedestrian rail crossings in the City of San Clemente.â3856 In San Clemente, a railroad track separates a beach from the residential and commercial areas of the city. The CPUC approved a project for a trail along the beach and for pedestrian rail crossings to permit access to the trail.3857 Because approximately fifty passing trains each day were required to sound their horns at each of the seven at-grade pedestrian crossings, there were numerous complaints of noise.3858 San Clemente petitioned the CPUC to replace the use of horns with an Audible Warning System to be used during non- emergency conditions at the at-grade pedestrian crossings.3859 BNSF responded to the cityâs 3854 See City of Des Plaines v. Union Pacific Railroad Company, available at: http://www.icc.illinois.gov/downloads/public/edocket/180071.pdf (last accessed March 31, 2015). 3855 218 Cal. App.4th 778, 160 Cal. Rptr.3d 492 (Cal. App. 2013). 3856 Id., 218 Cal. App.4th at 781, 160 Cal. Rptr.3d at 492-494. 3857 Id., 218 Cal. App.4th at 781, 160 Cal. Rptr.3d at 493. 3858 Id., 218 Cal. App.4th at 782, 160 Cal. Rptr.3d at 493-494. 3859 Id.
739 petition by arguing that under California state statutes the CPUC had no authority to alter the type of audible warning system used at at-grade pedestrian crossings.3860 The California court held that âhowever broad the scope of the commissionâs authority over railroad crossings may be, the commission does not have the authority to contravene the expressed will of the Legislature in this area.â3861 The Public Utility Code § 7604, in accordance with 49 C.F.R. § 222.12, requires the use of locomotive-mounted audible warning devices at all crossings in California unless the crossing is located in a federally established quiet zone.3862 The court set aside the CPUCâs decision that it had jurisdiction to consider approving the use of wayside horns in lieu of locomotive-mounted horns.3863 3860 Id., 218 Cal. App.4th at 783, 160 Cal. Rptr.3d at 495. 3861 Id., 218 Cal. App.4th at 785, 160 Cal. Rptr.3d at 495. 3862 Id., 218 Cal. App.4th at 781, 160 Cal. Rptr.3d at 493, 503. 3863 Id., 218 Cal. App.4th at 798, 160 Cal. Rptr.3d at 506.
740 XXXIV. QUIET ZONES A. Introduction This part of the Report discusses the regulatory framework involving quiet zones. In lieu of train horns, federal law allows for the use of alternative safety measures to âpromote the quiet of communities affected by rail operations.â3864 The regulations establish the procedures that govern the establishment of quiet zones and outline the application requirements, minimum requirements, and time frames.3865 With a few exceptions the regulations preempt state laws, rules, regulations, or orders on the sounding of a locomotive horn at public highway-rail grade crossings. Although states laws provide that quiet zones must comply with federal laws and regulations, state laws that are not preempted may regulate the use of locomotive horns outside federal quiet zones. Sections B through D, respectively, discuss federal law on the use of audible warnings at highway-rail grade crossings, exceptions to the use of a locomotive horn, and minimum requirements for the establishment of quiet zones. Section E discusses state laws relating to quiet zones. Sections F and G summarize cases on the use of audible warning devices outside federal quiet zones and whether state administrative procedures are preempted. Section H discusses guidance that is available on how to establish a quiet zone. 3864 49 U.S.C. § 20153 (2014). 3865 49 C.F.R. § 222.33, et seq. (2014).
741 Statutes and Regulations B. Audible Warnings at Highway-Rail Grade Crossings Federal law provides that to promote the quiet of communities affected by rail operations and the development of innovative safety measures at highway-rail grade crossings, the Secretary may, in connection with [the] demonstration of proposed new supplementary safety measures, order railroad carriers operating over one or more crossings to cease temporarily the sounding of locomotive horns at such crossings. Any such measures shall have been subject to testing and evaluation and deemed necessary by the Secretary prior to actual use in lieu of the locomotive horn.3866 C. Exceptions to the Use of a Locomotive Horn Section 222.33 gives a railroad operating over a public highway-rail crossing the discretion not to sound its trainâs horn when the locomotive is traveling fifteen miles per hour or less and members of the trainsâ crews or appropriately equipped flaggers warn motorists of approaching trains.3867 The section is not applicable when âactive grade crossing warning devices have malfunctioned and [the] use of the horn is required by 49 C.F.R. 234.105, 234.106, or 234.107.â3868 D. Minimum Requirements for a Quiet Zone Section 222.35 outlines the minimum requirements for quiet zones.3869 A quiet zone must be at least one-half mile long.3870 As long as there is no public highway-rail grade crossing 3866 49 U.S.C. § 20153(e) (2014). 3867 49 C.F.R. § 222.33(a) (2014). 3868 49 C.F.R. § 222.33(b) (2014). 3869 49 C.F.R. § 222.35 (2014). 3870 49 C.F.R. § 222.35(a)(1)(i) (2014).
742 where locomotive horns are sounded routinely, the minimum length of a quiet zone may be waived when a new Quiet or Partial Quiet Zone is added to an existing quiet zone.3871 No later than the implementation date for a quiet zone, a quiet zone must be equipped at active grade crossings with warning devices having both flashing lights and gates in conformity with the Manual on Uniform Traffic Control Devices (MUTCD).3872 Highway approaches to new Quiet and Partial Quiet Zones must âbe equipped with an advance warning sign that advises the motorist that train horns are not sounded at the crossing.â3873 Public highway-rail grade crossings in Quiet and Partial Quiet Zones that are âsubject[] to pedestrian traffic and equipped with one or more automatic bells shall retain those bells in working condition.â3874 A public authority may establish quiet zones regardless âof State laws covering the subject matter of sounding or silencing locomotive horns at public highway-rail grade crossings.â3875 A public authority may establish a quiet zone without an application to the FRA as long as it complies with either § 22.39 (a)(1),3876 (a)(2),3877 or (a)(3).3878 If an intended quiet zone does not comply with the aforementioned paragraphs 3871 49 C.F.R. § 222.35(a)(1)(ii) (2014). 3872 49 C.F.R. § 222.35(b)(1) (2014). 3873 49 C.F.R. §§ 222.35(c)(1)-(2) (2014). 3874 49 C.F.R. § 222.35(d)(1) (2014). 3875 49 C.F.R. § 222.37 (2014). 3876 The regulations provide that â[a] quiet zone may be established by implementing, at every public highway-rail grade crossing within the quiet zone, one or more [Supplementary Safety Measures] identified in appendix A of this part.â 49 C.F.R. § 222.39(a)(1) (2014). 3877 49 C.F.R. § 222.39(a)(2) (2014) provides: A quiet zone may be established if the Quiet Zone Risk Index is at, or below, the Nationwide Significant Risk Threshold, as follows:
743 [t]he public authority shall provide written notice, by certified mail, return receipt requested, of its intent to create a New Quiet Zone or New Partial Quiet Zone under § 222.39 ⦠or to implement new [Supplementary Safety Measures (SSM)3879] or [Non-engineering Alternative Safety Measures (ASM)3880] within a Pre-Rule Quiet Zone or Pre-Rule Partial Quiet Zone under § 222.41(c) or (d) of this part.3881 The notice should be sent to: â[a]ll railroads operating over the public highway-rail grade crossings within the quiet zone; the State agency responsible for highway and road safety; and the State agency responsible for grade crossing safety.â3882 A Notice of Intent must be mailed at least sixty days before mailing the Notice of Quiet Zone Establishment; comments may be submitted to the public authority during the sixtyâday period after the mailing of the Notice of Intent.3883 The information that is required to be included in a Notice of Intent, Notice of Quiet (i) If the Quiet Zone Risk Index is already at, or below, the Nationwide Significant Risk Threshold without being reduced by implementation of SSMs; or (ii) If SSMs are implemented which are sufficient to reduce the Quiet Zone Risk Index to a level at, or below, the Nationwide Significant Risk Threshold.â 3878 The regulations state that a quiet zone may be established when SSMs are implemented that are sufficient to reduce the Quiet Zone Risk Index to a level at or below the Risk Index with Horns. 49 C.F.R. § 222.39(a)(3) (2014). 3879 The FRA advises that âSSMs are engineering improvements, which when installed at highway-rail grade crossings within a quiet zone, would reduce the risk of a collision at the crossing.â United States Department of Transportation, Federal Railroad Administration, Train Horn Rule - Glossary, available at: http://www.fra.dot.gov/Page/P0629 (last accessed March 31, 2015), hereinafter referred to as âTrain Horn Rule â Glossary.â 3880 The FRA also states that â[a] safety system or procedure provided by the appropriate traffic control authority which, after individual review and analysis, is determined by the [FRA] to be an effective substitute for the locomotive horn at specific highway-rail grade crossings.â Train Horn Rule â Glossary, supra note 3879. 3881 49 C.F.R. § 222.43(a)(1) (2014). 3882 Id. 3883 49 C.F.R. §§ 222.43(b)(1) and (3) (2014).
744 Zone Establishment, and Notice of Quiet Zone Continuation is set forth in 49 C.F.R. § 222.43.3884 Section 222.7 states that part 222 of the C.F.R. (Use of Locomotive Horns at Public Highway-Rail Grade Crossings) âpreempts any State law, rule, regulation, or order governing the sounding of the locomotive horn at public highway-rail grade crossings[] in accordance with 49 U.S.C. 20106.â3885 However, with a few exceptions part 222 does not preempt any state law, rule, regulation, or order that governs âthe sounding of locomotive horns at private highway-rail grade crossings or pedestrian crossings;â whether SSMs or ASMs may be used for traffic controls; or âthe modification or installation of engineering improvements at highway-rail grade crossings.â3886 E. State Laws Relating to Quiet Zones Several states have enacted statutes with procedures and criteria to establish quiet zones that conform to 49 U.S.C. § 20153, including Colorado,3887 Minnesota,3888 Montana,3889 New Mexico,3890 North Dakota,3891 Ohio,3892 and Texas.3893 For example, the Minnesota statute states: 3884 49 C.F.R. §§ 222.43(b)(2), (c)(2), and (d)(2) (2014). 3885 49 C.F.R. § 222.7(a) (2014). 3886 49 C.F.R. §§ 222.7(b)-(e) (2014). 3887 Colo. Rev. Stat. § 31-25-1212.5 (2014). 3888 Minn. Stat. § 219.166 (2014). 3889 Mont. Code Ann. § 69-14-620 (2014). 3890 N.M. Stat. Ann. § 63-3-34 (2014).
745 A county, statutory or home rule charter city, or town may apply to the Federal Railroad Administration for the establishment of a âquiet zoneâ in which the sounding of horns, whistles, or other audible warnings by locomotives is regulated or prohibited. All quiet zones, regulations, and ordinances adopted under this section must conform to federal law and the regulations of the Federal Railroad Administration under United States Code, title 49, section 20153.3894 Many states provide information on the federal and local statutes and regulations that are applicable to quiet zones, including California,3895 Michigan,3896 Ohio,3897 and Oregon.3898 Several cities such as Boulder,3899 Denver,3900 Richmond (CA), and San Antonio3901 also provide information to the public on federal and local statutes and regulations that are associated with quiet zones. 3891 N.D. Cent. Code 49-11-21 (2014). 3892 Ohio Rev. Code Ann. § 4955.42 (2014). 3893 Tex. Transp. Code Ann. § 311.054 (2014). 3894 Minn. Stat. § 219.166 (2013). 3895 Quiet Zones, Cal. Pub. Utilities Commân, available at: http://www.cpuc.ca.gov/PUC/safety/Rail/Crossings/quietzones.htm (last accessed March 31, 2015). 3896 Quiet Zones, Mich. DOT, available at: https://www.michigan.gov/mdot/0,1607,7-151- 11056_22444_56486_56529---,00.html (last accessed March 31, 2015). 3897 Railroad Quiet Zones, Ohio Pub. Utilities Commân, available at: http://www.puco.ohio.gov/puco/index.cfm/consumer-information/consumer-topics/railroad-quiet-zones/ (last accessed March 31, 2015). 3898 Train Horn Rule - Quiet Zones, Or. DOT, available at: http://www.oregon.gov/ODOT/rail/Pages/whistle_noise.aspx (last accessed March 31, 2015). 3899 Train Noise and Quiet Zones, City of Boulder, available at: https://user.govoutreach.com/boulder/faq.php?cid=23324 (last accessed March 31, 2015). 3900 Quiet Zone Implementation, Regional Transp. Dist., available at: http://www.rtd- fastracks.com/nw_57 (last accessed March 31, 2015). 3901 Railroad Quiet Zones, San Antonio Depât Pub. Works, available at: http://www.sanantonio.gov/publicworks/railroadquietzones.aspx (last visited Apr. 24, 2014) (last accessed March 31, 2015).
746 Cases F. California Law Regulating the Use of Audible Warning Devices Outside of Federal Quiet Zones In BNSF Railway Company v. Public Utilities Commission3902 a California appellate court recognized that federal regulations require the use of audible warning devices in certain situations but not in others.3903 If a federal regulation leaves it to the states to regulate the use of audible sounds, the state may do so outside of federal quiet zones. In California, the relevant statute is Cal. Pub. Util. Code § 7604, which was amended in 2006 to âreplace[] the express requirement of a locomotive-mounted audible warning device with the express requirement that an audible warning device be sounded in accordance with Section 222.21 â a federal regulation that itself expressly requires the sounding of a [l]ocomotive hornâ¦.â3904 Therefore, the legislative intent was to require that an audible warning device mounted on a locomotive must be sounded at every railroad crossing in California.3905 Furthermore, the court clarified that although the California statute does not explicitly state that an audible warning device must be mounted on the locomotive, the statute does provide that an audible warning device must comply with § 222.21 of the C.F.R.3906 Because § 222.21 requires that an audible warning device be mounted on a locomotive, the court held that an 3902 160 Cal. Rptr.3d 492, 505 (Cal. Ct. App. 2013). 3903 Id. at 504. 3904 Id. at 505. 3905 Id. 3906 Id. at 503.
747 audible device mounted at a crossing was not in accordance with § 222.21.3907 The court ruled in favor of BNSF and, thus, set aside the decision of the Public Utilities Commission.3908 G. Preemption and Administrative Procedures In BNSF Railway Company v. Arizona Corporation Commission3909 the City of Flagstaff filed an application with the Arizona Corporation Commission to upgrade two crossings by installing additional audible warning devices or wayside horns.3910 After proper notice to all parties and a full evidentiary hearing, the Commission approved Flagstaffâs application. As stated in the Commissionâs opinion, âthe Train Horn Rules do not preempt the Commissionâs âadministrative proceduresâ regarding applications for the alteration of public at-grade crossings included or to be included in Quiet Zones[] to the extent that the alterations contemplated involve modification or installation of âengineering improvements.ââ3911 The Arizona Court of Appeals agreed and held that because the issue at the hearing was the approval or denial of a modification at a crossing the Commissionâs actions were administrative procedures.3912 The â[a]ction taken by the Commission to investigate and approve or deny installation of modifications to crossings, pursuant to statutorily granted authority, maintains its character as an administrative procedure and as such fits within the 3907 Id. 3908 Id. at 505. 3909 268 P.3d 1138 (Ariz. Ct. App. 2012). 3910 Id. at 1139. 3911 Id. at 1140-1141 (citation omitted). 3912 Id. at 1145.
748 preemption exemption.â3913 Furthermore, the installation of wayside horns constitutes an âengineering improvement.â3914 The court stated that â[m]aking certain that these modifications (1) are undertaken in a safe manner and (2) provide for physical safety at the crossing after completion (with the exception of the actual sounding of the horn) is precisely what the federal regulations permit State authorities to do.â3915 Inasmuch as the actions of the Commission were not preempted the appellate court affirmed the trial courtâs order in favor of the Commission.3916 Article H. Guidance on How to Create a Quiet Zone The FRA provides guidance on how to create Quiet Zones and refers to the relevant statutes and regulations for Pre-Rule Quiet Zones: Qualifying for Automatic Approval, Pre-Rule Quiet Zones not Qualified for Automatic Approval, and Creating a New Quiet Zone using SSMs.3917 The guidance provides flow charts illustrating the steps that need to be followed to establish or create quiet zones.3918 Finally, the FRAâs guidance provides sample documents and checklists that are associated with the process for establishing quiet zones.3919 3913 Id. 3914 Id. at 1146. 3915 Id. 3916 Id. 3917 United States Dept. of Transp., Federal Railroad Administration, How to Create a Quiet Zone (Sept. 27, 2012), available at: http://www.fra.dot.gov/eLib/details/L03055 (last accessed March 31, 2015). See link for downloading a PDF document for the referenced guidance. 3918 Id. 3919 Id.
749 XXXV. RAILROAD RETIREMENT AND DISABILITY EARNINGS ACT A. Introduction In the late 1800s and early 1900s, railroad companies were some of the largest and most successful companies in the United States. Over eighty percent of railroad employees had pension plans in the 1920s, plans that faced insolvency and other major financial issues because of the Great Depression in the 1930s.3920 In 1934, Congress enacted legislation for the regulation of railroad employeesâ pensions. In 1937, Congress enacted the Railroad Retirement Program.3921 Since the 1930s, although there have been many changes to the program, the federal government continues to regulate benefits.3922 Some of the more significant legislative changes are described below.3923 The Railroad Retirement Program also provides disability benefits for railroad employees who suffer from a permanent physical or mental disability.3924 Please note that the Railroad Unemployment Insurance Act (RUIA), which replaces state unemployment taxes and arrangements for railroad employees, is discussed in part XXXVII. Sections B and C discuss the Railroad Retirement Act of 1974 (RRA) and the amendments to the Act, as well as the Railroad Retirement Solvency Act of 1983, the Railroad 3920 U.S. Comm. on Ways & Means, âEarned Entitlements for Railroad Employees â Legislative History,â Green Book (2011), available at: http://greenbook.waysandmeans.house.gov/2011-green-book/chapter-5- earned-entitlements-for-railroad-employees/railroad-retirement-legislative (last accessed March 31, 2015), hereinafter referred to as âEarned Entitlements for Railroad Employees â Legislative History.â 3921 Id. 3922 Id. 3923 Id. See United States Social Security Administration, âAn Overview of the Railroad Retirement Program,â Social Security Bulletin Vol. 68, No. 2 (2008), available at: http://www.ssa.gov/policy/docs/ssb/v68n2/v68n2p41.html (last accessed March 31, 2015). 3924 45 U.S.C. §§ 231a(a)(1)(iv) and (v) (2014).
750 Retirement and Survivorsâ Improvement Act of 2001, and the American Recovery and Reinvestment Act of 2009. Section D explains some of the key provisions of the RRA. Section E discusses disability benefits. Sections F through K discuss the effect of retirement benefits on claims for damages, employees who are covered by the RRA, the effect of retirement on the ability to bring a claim under the Federal Employersâ Liability Act (FELA), whether railroad retirement benefits are a collateral source, and the admissibility of evidence regarding retirement benefits in FELA cases. Section L discusses an article on the collateral source rule. Statutes B. Railroad Retirement Act of 1974 The Railroad Retirement Act of 1974 or RRA sets forth the framework currently used for railroad retirement. The 1974 Act divided benefits into two tiers: Tier I, similar to the annuity benefits provided by Social Security, and Tier II, similar to private pension plans with more benefits.3925 Tier I benefits, âlike social security benefits, and unlike most private pension plans, ⦠are not contractual. Congress may alter or even eliminate them at any time.â3926 Tier II benefits are more similar to a private pension plan in which pension benefits are directly related to a workerâs earnings and length of service. Unless an employee suffers a disability, an employee does not receive any benefits until he or she reaches the age of retirement. Railroad employers 3925 45 U.S.C. §§ 231-31v (2014). 3926 Lee v. Lee, 727 So.2d 622, 626 (La. App. 1998).
751 and employees each pay taxes to the IRS to fund the Tier I and Tier II programs. Social Security and other taxes also fund the program.3927 C. Amendments to the 1974 Act 1. Railroad Retirement Solvency Act of 1983 In 1983, financial difficulties caused by declining numbers of railroad employees, inflation, and increased numbers of beneficiaries prompted Congress to make further changes to railroad retirement.3928 The Railroad Retirement Solvency Act of 1983 instituted measures to increase the financial stability of the program, such as increasing payroll taxes, subjecting Tier II benefits to federal income taxes the same as private pensions, and instituting a five-month waiting period for disability benefits.3929 2. Railroad Retirement and Survivorsâ Improvement Act of 2001 In 2001, Congress modified railroad retirement benefits and financing with the Railroad Retirement and Survivorsâ Improvement Act (RRSIA). The RRSIA provides employees (and their spouses) who retire after the age of 60 and after completing at least thirty years of railroad service with full Tier I and II benefits.3930 Spouses may receive their own benefits while the 3927 Id. 3928 Earned Entitlements for Railroad Employees â Legislative History, supra note 3920. 3929 Railroad Retirement Solvency Act of 1983, Pub. L. No. 98-76, 97 Stat. 411, 45 U.S.C. §§ 231-231f, 231f-1, 231m, 231n, 231n-1, 231u, and 231v (1983). 3930 Railroad Retirement and Survivorsâ Improvement Act of 2001, Pub. L. No. 107-90, 115 Stat. 878, 45 U.S.C. §§ 231a-31f, 231n, 231n-1, 231q, 231r, 231u, and 231v (2001). See Earned Entitlements for Railroad Employees â Legislative History, supra note 3920.
752 employee is still alive.3931 The RRSIA repealed a monthly cap on retirement and disability benefits and increased benefits for certain widows of railroad workers.3932 Furthermore, the RRSIA created the National Railroad Retirement Investment Trust to invest money in government securities and nongovernmental assets.3933 The RRSIA also modified payroll taxes for railroad employers and employees and made other financial and accounting changes.3934 3. American Recovery and Reinvestment Act of 2009 The 2009 changes to railroad retirement plans occurred as a result of the American Recovery and Reinvestment Act (ARRA).3935 The ARRA included railroad retirement beneficiaries in its one-time economic recovery payments.3936 The ARRA also extended the length of the maximum time that railroad workers could receive unemployment benefits and excluded up to $2,400 in unemployment and sickness benefits from federal or state income taxes in 2009 and thereafter.3937 3931 See U.S. Railroad Retirement Board, âRailroad Retirement Spouse Benefits,â available at: http://www.rrb.gov/pdf/lmo_educational_materials/RRB_Spouse_Benefits.pdf (last accessed March 31, 2015). 3932 Earned Entitlements for Railroad Employees â Legislative History, supra note 3920. 3933 Id. 3934 Id. 3935 Pub. L. No. 111-5, 123 Stat. 115 (2009). 3936 Earned Entitlements for Railroad Employees â Legislative History, supra note 3920. 3937 Id.
753 D. Key Provisions of the Railroad Retirement Act 1. Definition of Employer Section 231(a) of the RRA defines an employer to include, for example, âany carrier by railroad subject to the jurisdiction of the Surface Transportation Board under part A of subtitle IV of title 49â3938 and âany railway labor organization, national in scope, which has been or may be organized in accordance with the provisions of the Railway Labor Act, as amended.â3939 2. Definition of Employee Under § 231(b) of the RRA an employee includes âany individual in the service of one or more employers for compensationâ3940 and âany individual who is in the employment relation to one or more employers,â3941 as well as other categories set forth in the statute.3942 3. Eligibility Requirements for an Annuity The eligibility requirements for an annuity are set forth in § 231a(a)(1) of the RRA: (1) The following-described individuals, if they shall have completed ten years of service (or, for purposes of paragraphs (i), (iii), and (v), five years of service, all of which accrues after December 31, 1995) and shall have filed application for annuities, shall, subject to the conditions set forth in subsections (e), (f), and (h) of this section, be entitled to annuities in the amounts provided under section 231b of this titleâ (i) individuals who have attained retirement age (as defined in section 216(l) of the Social Security Act [42 U.S.C. 416 (l)]); (ii) individuals who have attained the age of sixty and have completed thirty years of service; 3938 45 U.S.C. § 231(a)(1)(i) (2014). 3939 45 U.S.C. § 231(a)(v) (2014). 3940 45 U.S.C. § 231(b)(1)(i) (2014). 3941 45 U.S.C. § 231(b)(1)(ii) (2014). 3942 45 U.S.C. § 231(b) (2014).
754 (iii) individuals who have attained the age of sixty-two and have completed less than thirty years of service, but the annuity of such individuals shall be reduced by 1/180 for each of the first 36 months that he or she is under retirement age (as defined in section 216(l) of the Social Security Act [42 U.S.C. 416 (l)]) when the annuity begins to accrue and by 1/240 for each additional month that he or she is under retirement age (as defined in section 216(l) of the Social Security Act) when the annuity begins to accrue; (iv) individuals who have a current connection with the railroad industry, whose permanent physical or mental condition is such as to be disabling for work in their regular occupation, and who (A) have completed twenty years of service or (B) have attained the age of sixty; and (v) individuals whose permanent physical or mental condition is such that they are unable to engage in any regular employment. 4. Supplemental Annuity Section 231a(b) describes who is eligible for a supplemental annuity: An individual whoâ (i) has attained age 60 and completed thirty years of service or attained age 65; (ii) has completed twenty-five years of service; (iii) is entitled to the payment of an annuity under subsection (a)(1) of this section; (iv) had a current connection with the railroad industry at the time such annuity began to accrue; and (v) has performed compensated service in at least one month prior to October 1, 1981; shall, subject to the conditions set forth in subsections (e) and (h) of this section, be entitled to a supplemental annuity in the amount provided under section 231b of this title: Provided, however, That in cases where an individualâs annuity under subsection (a)(1) of this section begins to accrue on other than the first day of the month, the amount of any supplemental annuity to which he is entitled for that month shall be reduced by one-thirtieth for each day with respect to which he is not entitled to an annuity under subsection (a)(1) of this section.3943 3943 See United States Railroad Retirement Board, Railroad Retirement and Survivor Benefits, available at: http://www.rrb.gov/pdf/opa/ib2.pdf (last accessed March 31, 2015).
755 5. Other Individuals who are Eligible for an Annuity Other provisions of the RRA provide for an annuity for spouses,3944 surviving widows and widowers,3945 children,3946 and others.3947 6. Computation of an Annuity Section 231b of the RRA governs the computation of an annuity. The amount of the annuity is usually equal to the old-age insurance benefit or disability benefit for which the employee would be eligible under Social Security.3948 Other provisions in § 231b, however, determine the amount of an annuity as there are provisions that increase or decrease an annuity, as well as other important provisions.3949 Section 213c applies to the computation of an annuity for a spouse or survivor.3950 7. Railroad Retirement Board The RRA is administered by the Railroad Retirement Board (RRB or Board) established by the Railroad Retirement Act of 1937 as an independent agency in the executive branch.3951 8. Judicial Review With respect to judicial review of a decision of the Board, the law provides: 3944 45 U.S.C. § 231a(c) (2014). 3945 45 U.S.C. §§ 231a(d)(i) and (ii) (2014). 3946 45 U.S.C. § 231a(d)(iii) (2014). 3947 See 45 U.S.C. §§ 231(e) and (e)(a)(5) (2014). 3948 45 U.S.C. § 231b(a)(1) (2014). 3949 45 U.S.C. § 231b (2014). 3950 45 U.S.C. § 231c (2014). 3951 45 U.S.C. § 231f(a) (2014).
756 Decisions of the Board determining the rights or liabilities of any person under this subchapter shall be subject to judicial review in the same manner, subject to the same limitations, and all provisions of law shall apply in the same manner as though the decision were a determination of corresponding rights or liabilities under the Railroad Unemployment Insurance Act [45 U.S.C. 351 et seq.] except that the time within which proceedings for the review of a decision ⦠may be commenced shall be one year after the decision will have been entered upon the records of the Board and communicated to the claimant.3952 E. Disability Benefits As stated, the RRA provides disability benefits for certain railroad employees.3953 The Board has the authority to determine the physical and mental conditions for which employees may be disqualified to work in the several occupations in the railroad industry. The standards are to be determined with the cooperation of employers and employees in the railroad industry.3954 Regulations regarding the Boardâs determination of a disability under the RRA are set forth in 20 C.F.R. §§ 220.1â220.187. Cases F. Effect of Retirement Benefits on Damages McCarthy v. Palmer3955 involved â[a]n interesting question as to the measure of damages in view of the provisions of the Railroad Retirement Act of 1937 (45 U.S.C.A. § 228a et seq.).â3956 In McCarthy the Second Circuit denied the railroad employerâs request to reduce the amounts of damages for an injury sustained by a railroad employee when he fell from a caboose 3952 45 U.S.C. § 231g (2014). 3953 See 45 U.S.C. §§ 231a(a)(1)(iv) and (v) (2014). 3954 See 45 U.S.C. § 231a(a)(2) (2014). 3955 113 F.2d 721 (2d Cir. 1940), cert. denied, 311 U.S. 680, 61 S. Ct. 50, 85 L. Ed. 438 (1940). 3956 Id. at 723.
757 while working as a trainman.3957 The railroad employer argued that it mitigated damages by contributing to the railroad retirement pension plan from which the employee would receive an annuity.3958 The court held that the future benefits that would be received by the employee from his pension plan were the result of his length of service in the railroad industry and not because of his injuries.3959 Therefore, the railroad employer could not use the amounts contributed to the railroad pension system to reduce the damages to which the employee was entitled.3960 G. Employers Subject to the Railroad Retirement Act In Herzog Transit Services v. United States Railroad Retirement Board3961 the plaintiff Herzog Transit Services (Herzog) contracted with the owners of a railway to operate an interstate commercial rail service and to perform dispatching services. The RRA provides that an employer covered by the law means any rail carrier subject to the jurisdiction of the Surface Transportation Board (STB).3962 The Railroad Retirement Board determined that because of Herzogâs dispatching services Herzog qualified as one performing the functions of a common carrier. Thus, Herzogâs dispatching unit was a covered employer under the RRA.3963 The Seventh Circuit upheld the decision on appeal.3964 3957 Id. 3958 Id. 3959 Id. 3960 Id. 3961 624 F.3d 467 (7th Cir. 2010). 3962 Id. at 472 (citing 45 U.S.C. § 231(a)(1)(i) (2010)). 3963 Id. at 469. 3964 Id. at 478.
758 H. Effect of Retirement on an Employeeâs Ability under FELA to Recover Damages for Lost Future Wages In CSX Transportation, Inc. v. Miller,3965 Miller, an employee of CSX, brought a claim under FELA for CSXâs alleged negligence that caused Miller to sustain a permanent injury to his neck. Because of his pain, Miller decided to retire earlier than he would have but did not file for disability benefits in addition to his retirement benefits.3966 When Miller later brought a FELA claim, CSX argued that Millerâs retirement precluded his ability to recover damages for his loss of future wages.3967 However, the court held: Millerâs retirement and his voluntary relinquishment of his right to employment with CSX would not preclude him from seeking as damages under the FELA wages that, but for the alleged negligence of CSX and his resulting injury, he would have continued to earn through his employment with CSX.3968 Therefore, the Supreme Court of Alabama held that the trial court did not err in denying CSXâs pre-verdict motion for judgment as a matter of law on Millerâs claim for lost wage after March 2003.3969 I. Computation of Disability Benefits The Supreme Court of Montana held in Bonner v. Railway Employees Mutual Assân3970 that the benefits in § 231(a)(1)(iv) are compensation for the services an employee contributed previously; therefore, the benefits are not measured by an employeeâs disability. 3965 46 So.3d 434 (Ala. 2010). 3966 Id. at 440. 3967 Id. at 444. 3968 Id. at 453. 3969 Id. at 453-454.
759 J. Railroad Retirement Benefits are a Collateral Source The collateral source rule provides that if an injured party is receiving benefits from a collateral source that is independent of the wrongdoer, the benefits will not offset the amount of damages recoverable from one who caused the injury.3971 In Sloas v. CSX Transp. Inc.3972 the Fourth Circuit held that Tier II benefits received by railroad workers under the Railroad Retirement Act qualify as a collateral source. The Fourth Circuit affirmed the district courtâs decision that the railroad employerâs contribution to funds used to pay for the employeeâs disability benefits could not be used to offset damages in a FELA claim.3973 K. Admissibility of Evidence of Retirement Benefits in FELA Claims In Norfolk Southern Railway Co. v. Tiller,3974 Tiller, an employee of Norfolk Southern, brought a FELA claim for injuries stemming from an accident at work. Only damages were at issue because Norfolk Southern admitted that it was negligent.3975 To calculate damages in the form of lost future wages, Tiller testified that he likely would work until he was 65; however, Norfolk Southern wanted to introduce evidence that the RRA would allow Tiller to retire at age 60 with full benefits so that the jury should determine Tillerâs loss of future wages until age 60, 3970 119 Mont. 63, 170 P.2d 400 (1946) (cited by Laird v. Illinois C. G. R. Co., 208 Ill. App.3d 51, 566 N.E.2d 944, 956 (Ill. App. Ct. 5th Dist. 1991)). 3971 See Giddens v. Kansas City S. Ry. Co., 29 S.W.3d 813 (Mo. 2000); see also, Melton v. Illinois Cent. Gulf R. Co., 763 S.W.2d 321 (Mo. Ct. App. 1988). 3972 616 F.3d 380, 392 (4th Cir. 2010). 3973 Id. 3974 179 Md. App. 318, 944 A.2d 1272 (Md. Ct. Sp. App. 2008). 3975 Id., 179 Md. App. at 320, 944 A.2d at 1274.
760 not 65.3976 Although the Maryland Special Court of Appeals noted the relevance of the age when an employee would become eligible for retirement benefits, the court held that Tillerâs retirement benefits are a collateral source. Such evidence should be excluded at trial ââbecause of the danger that the jury would use this evidence for the improper purpose of mitigating [Tillerâs] damages or reducing [Norfolk Southernâs] liability.ââ3977 Therefore, the court upheld the trial courtâs decision not to admit evidence of the employeeâs eligibility for railroad retirement benefits.3978 Articles L. Recourse for Railroads after the Tiller Decision An article entitled âPension Benefits as an Evidentiary Collateral Sourceâ3979 discusses a possible unique application of the collateral source rule after the decision in Tiller. The article states that although the Tiller decision favors plaintiffs, the railroads are not left without recourse.3980 A decision prior to Tiller implied that patterns of retirement among railroad workers, rather than retirement benefits, should be admissible to determine damages for lost future wages.3981 The authors argue that â[w]hile pension benefits themselves cannot be 3976 Id., 179 Md. App. at 321, 944 A.2d at 1275. 3977 Id., 179 Md. App. at 341, 944 A.2d at 1287 (quoting Griesser v. National Railroad Passenger Corp., 2000 PA Super 313, P24, 761 A.2d 606, 613 (Pa. Super. 2000)). 3978 Id., 179 Md. App. at 339-340, 944 A.2d at 1285-1286. 3979 Lane B. Hudgins and Thomas R. Ireland, âPension Benefits as an Evidentiary Collateral Source,â 15 J. Legal Econ. 75 (2008). 3980 Id. at 77-78. 3981 Id. (citing Griesser v. National Railroad Passenger Corp., 2000 PA Super 313, 761 A.2d 606 (Pa. Super. 2000)).
761 introduced to demonstrate the unlikelihood of a railroad worker working to age 65, the retirement percentages of railroad workers with 30 years of railroad experience that were discussed above do not require specific mention of pension benefits.â3982 The authors argue that an expert for the defense âcould presumably testify about the percentages of railroad workers with 30 years of railroad experience who retire at ages 60, 61, 62, and 63â as long as the intent is not to âbring pension benefits to the attention of the jury.â3983 They discuss three âdecisions that have reached the conclusion that pension benefits are an evidentiary collateral source in the sense that we have been describing.â3984 M. Railroad Retirement Tax Act and Role of Railroad Retirement Board According to the Internal Revenue Service (IRS) Railroad Retirement Tax Act (RRTA) Desk Guide, dated January 2009,3985 the RRTA is the responsibility of the IRS and the Railroad Retirement Board (RRB). Railroad employers are subject to a system of employment taxes that is separate from the Federal Insurance Contributions Act (FICA) and the Federal Unemployment Tax Act (FUTA) that cover âmost other employers.â3986 RRTA taxes fund railroad worker retirement benefits that are the responsibility of the IRS. Thus, the RRBâs role is to administer the benefits of the Railroad Retirement Act (RRA) and the Railroad Unemployment Insurance Act (RUIA). As for who is an employer subject to the RRTA, the RRB investigations on 3982 Id. at 78 (footnote omitted)). 3983 Id. 3984 Id. at 77. 3985 Available at: http://www.irs.gov/Businesses/Railroad-Retirement-Tax--Act-%28RRTA%29-Desk- Guide-%28January-2009%29#2 (last accessed March 31, 2015), hereinafter referred to as âIRS RRTA Desk Guide.â 3986 Id.
762 whether an employer is an RRA employer are referred to as âdeterminations of coverage.â3987 However, the IRSâs policy is to construe âthe term âemployerâ for RRTA purposes in the same mannerâ as the term is construed and applied for RRA and RUIA purposes.3988 The IRS also notes that the STB ârequires companies involved in the transportation industry to file reports and to list in these reports all affiliated companiesâ3989 and that â[a]ny company listed in these schedules will generally be railroad employers set out in Treas. Reg. § 31.3231(a)-1.â3990 3987 Id. 3988 Id. (citing Rev. Rul. 77-445, 1977-2 C.B. 357; Rev. Rul. 74-121, 1974-1 C.B. 300; City of Galveston by and through Board of Trustees v. United States, 33 Fed. Cl. 685 (1995); Standard Office Bldg. Corp. v. United States, 819 F.2d 1371 (7th Cir. Ill. 1987); Galveston by and through Board of Trustees v. United States, 22 Cl. Ct. 600 (1991); and Carland, Inc. v. United States, 75 A.F.T.R.2d 1234 (W.D. Mo. 1995)). 3989 Id. The IRS RTA Desk Guide notes that â[t]hese reports provide information regarding the principal business activity, the form of control, the percentage of control, along with information regarding any other company that may own a portion of the affiliated company.â 3990 See id. for an extensive list of categories of railroad employers subject to the RRTA.
763 XXXVI. RAILROAD REVITALIZATION AND REGULATORY REFORM ACT AND OTHER RAILROAD TAXATION ISSUES A. Introduction The Railroad Revitalization and Regulatory Act (4R Act) prohibits the imposition of discriminatory taxes on rail carriers at the state level. Section B discusses the 4R Act, its definitions, and its prohibitions on discriminatory taxes on railroads. Section C discusses judicial approaches to determining the proper class of property or proper taxpayer to use to compare to railroad property or railroad companies being assessed. Some courts use a functional approach that compares the property of railroad companies to the property of other industrial and commercial properties in the area, whereas other courts use a competitive approach that compares a railroad company to its main competitors in the area in determining whether the assessed taxes discriminate against railroads. Sections D through G, respectively, discuss cases involving the scope of § 11501(b)(4) of the 4R Act, whether an Oregon ad valorem tax was discriminatory as to railcars, whether a stateâs exemption of a railroadâs competitors from the stateâs sales tax is discriminatory under § 11501(b)(4) of the 4R Act, whether privately owned but affiliated companies are protected by the 4R Act, federal laws that require railroads that are reorganizing in bankruptcy to pay taxes that are owed to a state, and the tax liability of trustees of railroads that are undergoing reorganization. Finally, section H discusses an article on the meaning of the 4R Act within the context of the Commerce Clause of the United States Constitution.
764 B. The Railroad Revitalization and Regulatory Reform Act Statute 1. Definition of Rail Transportation and of Commercial and Industrial Property The 4R Act defines the term ârail transportation propertyâ to be that property âowned or used by a rail carrier providing transportation subject to the jurisdiction of the [Surface Transportation] Board.â3991 The term âcommercial and industrial propertyâ is defined as âproperty, other than transportation property and land used primarily for agricultural purposes or timber growing, devoted to a commercial or industrial use and subject to a property tax.â3992 2. The 4R Actâs Prohibition on Taxes that Discriminate against Railroads Section 11501(b) of the 4R Act describes âacts [that] unreasonably burden and discriminate against interstate commerceâ that the 4R Act prohibits.3993 Under subsection (b)(4) of the 4R Act a state, subdivision of a state, or an authority acting for a state or subdivision of a state may not â[i]mpose another tax that discriminates against a rail carrier providing transportation subject to the jurisdiction of the Board under this part.â3994 Although the entire statute should be reviewed, § 11501(c) of the 4R Act provides in part that â[r]elief may be granted under this subsection only if the ratio of assessed value to true market value of rail transportation property exceeds by at least 5 percent the ratio of assessed 3991 49 U.S.C. § 11501(a)(3) (2014). 3992 49 U.S.C. § 11501(a)(4) (2014). 3993 49 U.S.C. § 11501(b) (2014). 3994 49 U.S.C. § 11501(b)(4) (2014).
765 value to true market value of other commercial and industrial property in the same assessment jurisdiction.â3995 State law determines the burden of proof for determining assessed value.3996 Finally, § 11501(c) of the 4R Act grants jurisdiction to federal district courts âwithout regard to the amount in controversy or citizenship of the partiesâ to provide relief when there is a violation of subsection (b) of the statute.3997 Cases C. Judicial Approaches to Determining the Proper Class of a Property or Taxpayer for Comparison to Railroad Property or a Railroad Company 1. The Functional Approach In Kansas City S. Ry. Co. v. Koeller,3998 involving the 4R Act, the Seventh Circuit held that a tax was discriminatory that was applied to railroad property located in a flood zone that was taxed in a manner that differed from other commercial and industrial properties in the same zone. Kansas City Southern and Norfolk Southern operate on Sny Island in Illinois that has a levee and drainage system to prevent flooding caused by the Mississippi River.3999 Each year for decades Sny Island collected an annual maintenance assessment from landowners, including railroads.4000 With some adjustment based on the elevation of each track of land, 3995 49 U.S.C. § 11501(c) (2014). 3996 Id. 3997 Id. 3998 653 F.3d 496 (7th Cir. 2011), injunction granted, on remand, 2011 U.S. Dist. LEXIS 97235 (C.D. Ill., Aug. 30, 2011), cert. denied, 132 S. Ct. 855, 181 L. Ed.2d 551, 2011 U.S. LEXIS 8932 (U.S., Dec. 12, 2011). 3999 Id. at 499. 4000 Id.
766 Sny Island simply divided its operating budget by the total number of benefited acres and assessed a per-acre fee to each landowner based upon the number of acres owned. ⦠On average, landowners paid $8.50 per acre. This rate had been in place since 1987 and, by all accounts, it provided sufficient funding for the [Sny Island Levee Drainage] District.4001 However, after 2008 because of severe flooding and an increase in the price of diesel fuel, the commissioners of Sny Island decided that an increase in the annual maintenance assessment was required for 2009.4002 Although the opinion discusses in detail how the new assessment was determined, in essence the approach for railroads was to âmultipl[y] the total cost of replacing the rail line â which includes ballast (the layer of crushed rock on which the railroad track is laid), track, ties, and embankments â by the number of daysâ the rail line was expected âto be closed as a result of a flood or clean-up following a flood.â4003 Although the approach was refined before being implemented, the result was that the commissioners adopted a benefit figure of $1,296,125 for Kansas City Southern and $1,422,990 for Norfolk Southern. [F]or the Railroads this ârefinedâ assessment represented an astronomical increase in assessment: $85,545 for Kansas City Southern, a 4800% increase over its 2008 assessment of $1,774, and $93,920 for Norfolk Southern, an 8300% increase over its 2008 assessment of $1,126. Had the Railroads been assessed on a per-acre basis for 2009, Kansas City Southern would have been obligated to pay $3,898, while Norfolk Southern would have owed $2,578.4004 The railroad companies brought an action under the 4R Act for a violation of 49 U.S.C. § 11501(b)(4), which provides that a state may not âimpose another tax that discriminates against a 4001 Id. at 499-500. 4002 Id. 4003 Id. at 501. 4004 Id. at 502.
767 rail carrier providing transportation subject to the jurisdiction of the Board under this part.â4005 The district court held that the railroads failed to prove a violation under § 11501(b)(4) because they failed to present evidence of the true market value of the property.4006 On appeal, the Seventh Circuit addressed two questions: âfirst, whether the assessment charged by Sny Island constitutes âanother taxâ within the meaning of subsection (b)(4) of the 4R Act; and second, if so, whether that tax impermissibly discriminates against them.â4007 The court held that the fee imposed by the island constituted a tax under § 11501(b)(4).4008 As the commissioners conceded, the fee raises general revenues, and its ultimate use is for the whole District. Unlike an assessment for a small project, the money raised is available for all the work of the District; no particular expenditure is tied to a particular benefit obtained by a specific taxpayer. The commissioners use their funds to pay their salaries, make repairs to levees far away from railroad property, purchase new equipment, and pay for diesel fuel to operate the pumps. Bearing in mind the expansive reading of the term âtaxâ that the Supreme Court has endorsed, this is enough to make it a âtaxâ for purposes of the 4-R Act.4009 As for whether the tax discriminated against railroads, the court first had to determine the class of property to which the railroadsâ property should be compared.4010 The circuit courts of appeal generally have utilized three approaches: (1) a universal approach that examines all property owners in the area; (2) a functional approach that considers other commercial and 4005 49 U.S.C. § 11501(b)(4). 4006 Kan. City S. Ry. Co., 653 F.3d at 503. 4007 Id. at 504. 4008 Id. at 507. 4009 Id. (citation omitted). 4010 Id. at 508.
768 industrial property in the area; and (3) a competitive approach that compares railroad companies to their main competitors in the area.4011 The court concluded that the intent of Congress was that § 11501(b)(4) of the 4-RAct must be read in conjunction with subsections (1)-(3) of § 11501(b) because the other subsections use commercial and industrial property for the purpose of comparison.4012 Because the island imposed the tax unequally on commercial and industrial property owners, the court held that the tax was discriminatory.4013 The Seventh Circuit remanded the case to the district court to enjoin the 2009 assessment, although âleaving the [Sny Island Levee Drainage] District free to go back to the drawing board and craft an assessment that is nondiscriminatory.â4014 2. The Competitive Approach In Burlington N. Santa Fe Ry. Co. v. Lohman,4015 also concerning the 4R Act, the Eighth Circuit considered allegations of discrimination in the taxation of railroad companies with respect to Missouriâs general sales and use taxes on diesel fuel for which trucks and barges were exempt. BNSF alleged that the imposition of the tax on it but not on its competitors, trucks and barges, was discriminatory in violation of the 4R Act.4016 The court stated that under the 4R Act 4011 Id. 4012 Id. at 509. 4013 Id. at 511. 4014 Id. at 512. Also applying the functional approach are Atchison, Topeka & Santa Fe Ry. Co. v. Arizona, 78 F.3d 438 (9th Cir. 1996) (holding that the district court erred in applying the competitive approach to § (b)(4)); Kansas City S. Ry. Co. v. McNamara, 817 F.2d 368 (5th Cir. 1987) (holding that the Louisiana Tax on Transportation and Communication Utilities violated the section). 4015 193 F.3d 984 (8th Cir. 1999). 4016 Id. at 985.
769 there are two possible classes from which to choose to compare railroad property and the property of other taxpayers: the âcompetitive mode classâ and the commercial and industrial class.4017 The court stated that the purpose of § 11501(b)(4) of the 4R Act is âto prevent discriminatory taxation in any form and to cover a wide variety of taxing techniquesâ and that âthe comparison class should be appropriate to the type of tax and discrimination challenged in a particular case.â4018 The Eighth Circuit concluded that Congress purposefully omitted a âspecific comparison classâ from the subsection and therefore held that the âproper comparison class for Missouri sales and use taxes is the competitive mode.â4019 As for whether the tax discriminated against BNSF, the court considered the sales and use taxes imposed on fuel to determine whether there was a discriminatory application of the tax.4020 Because barges and trucks did not pay a tax that the railroads were required to pay, the court held that the tax was discriminatory.4021 In reversing and remanding the district courtâs holding that the tax was nondiscriminatory, the Eighth Circuit instructed the district court to enter a declaratory judgment and to grant BNSF injunctive relief.4022 4017 Id. 4018 Id. at 986. 4019 Id. 4020 Id. 4021 Id. 4022 Id. Also applying the competitive approach are Burlington N. R. Co. v. Commâr of Revenue, 509 N.W.2d 551 (Minn. 1993) (applying the competitive approach to § (b)(4) and holding that the Minnesota sales and use taxes imposed on the railroad were discriminatory under § (b)(4) when compared to the taxes imposed on other forms of transportation); and Atchison, Topeka & Santa Fe Ry. Co. v. Bair, 338 N.W.2d 338 (Iowa 1983) (applying the competitive approach to § (b)(4) and holding that the Iowa tax on fuel consumption violated the subsection when the tax on the railroad was compared to taxes imposed on other transportation industries).
770 D. Scope of Section 11501(b)(4)âs Prohibition on Discriminatory Taxes 1. Whether State Ad Valorem Tax that Exempted Certain Classes of Business Property applied to Railroad Cars Another case involving the 4R Act is Depât of Revenue v. ACF Industries, Inc. 4023 The issue was Oregonâs ad valorem tax that was imposed on all property except for certain âclasses of business personal property [that were] exempt.â4024 Railroad companies brought an action for declaratory and injunctive relief because the Oregon tax applied to the companiesâ railroad cars when other classes of personal property were exempt.4025 A district court held that Oregonâs ad valorem property tax did not violate subsection (b)(4) of § 11503 of the 4R Act because the tax did not exempt âmore than 50% of nonrailroad commercial personal property.â4026 In reversing the district court, an appeals court held that an exemption from a tax that is allowed taxpayers other than railroad companies may come within subsection (b)(4) of § 11503 and be discriminatory.4027 The Supreme Court held that because âidentical wordsâ used in a statute in different sections must have the same meaning, the meaning of âcommercial and industrial propertyâ throughout the act must mean âproperty subject to a property tax levyâ as it is defined in subsection (c)(1).4028 Therefore, âthe definition of âcommercial and industrial propertyâ excludes 4023 510 U.S. 332, 343, 114 S. Ct. 843, 849, 127 L Ed.2d 165, 175 (1993). 4024 Id., 510 U.S. at 335, 114 S. Ct. at 846, 127 L. Ed.2d at 170. 4025 Id., 510 U.S. at 335-336, 114 S. Ct. at 846, 127 L. Ed.2d at 171. 4026 Id., 510 U.S. at 337, 114 S. Ct. at 847, 127 L. Ed.2d at 172. 4027 Id., 510 U.S. at 337-338, 114 S. Ct. at 847, 127 L. Ed.2d at 172. 4028 Id., 510 U.S. at 341, 342, 114 S. Ct. at 848-849, 127 L. Ed.2d at 174-175.
771 property that is exempt [from a tax]â because exempt property is not covered under subsections (b)(1)-(3) that refer to commercial and industrial property.4029 The court held that â[i]t would be illogical to conclude that Congress, having allowed the State to grant property tax exemptions in subsections (b)(1)-(3), would turn around and nullify its own choice in subsection (b)(4).â4030 The Supreme Court reversed and remanded.4031 2. Whether a Stateâs Exemption of a Railroadâs Competitors from the Stateâs Sales Tax is Discriminatory under § 11501(b)(4) of the 4R Act 1. Decision by the Eleventh Circuit In CSX Transportation, Inc. v. Alabama Depât of Revenue,4032 although rail carriers, motor carriers, and water carriers compete for business shipping freight in interstate commerce, Alabama has a different method of taxing diesel fuel tax according to the type of carrier. Rail carriers pay a four percent state sales tax; motor carriers pay an excise tax of nineteen cents per gallon; and water carriers pay no fuel tax.4033 Section 11501(b)(4) of the 4R Act provides that a state may not impose a tax that discriminates against a rail carrier. CSX Transportation Inc. (CSX) alleged that Alabamaâs exemption of its main competitors from the stateâs sales tax 4029 Id., 510 U.S. at 342, 114 S. Ct. at 849, 127 L. Ed.2d at 175. 4030 Id., 510 U.S. at 343, 114 S. Ct. at 849, 127 L. Ed.2d at 175. 4031 Id., 510 U.S. at 348, 114 S. Ct. at 852, 127 L. Ed.2d at 178. 4032 720 F.3d 863 (11th Cir. 2013), reversed, remanded, CSX Transportation, Inc. v. Ala. Depât of Revenue, 131 S. Ct. 1101, 179 L. Ed.2d 37 (2011), reversed and remanded, Ala. Depât of Revenue v. CSX Transp., 135 S. Ct. 1136, 191 L. Ed.2d 113, 2015 U.S. LEXIS 1739 (U.S., Mar. 4, 2015). 4033 Id. at 865.
772 discriminated against rail carriers because CSXâs competitors are granted a competitive advantage.4034 The Supreme Court reversed and remanded the Eleventh Circuitâs affirmance of a district courtâs dismissal of the CSX complaint.4035 The Court held that CSX could challenge Alabamaâs sales and use taxes on the basis that they discriminate against rail carriers under § 11501(b)(4).4036 On remand, the district court held that the sales tax did not discriminate against CSX in violation of the 4R Act because motor carriers paid a similar amount in taxes and CSX did not demonstrate that the exemption of water carriers was discriminatory.4037 The Eleventh Circuit reversed and remanded, holding that the Alabama sales tax discriminates against rail carriers and that the state did not offer a sufficient justification for the discrimination. The court ruled that the competitive model applied; that the purpose of the 4R Act was to ensure âfinancial stabilityâ for rail carriers; and that rail carriers, therefore, had to be compared to their competitors that offer freight transportation within the state of Alabama rather than to all tax payers in the state.4038 The court further ruled that CSX established a prima facie case for discrimination because CSX has to pay a four percent sales tax whereas its competitors are not required to pay it.4039 Thus, the state had the burden of justifying the discriminatory tax. 4034 Id. 4035 CSX Transportation, Inc. v. Ala. Depât of Revenue, 131 S. Ct. 1101, 179 L. Ed.2d 37 (2011). 4036 CSX Transportation, Inc., 720 F.3d at 866. 4037 Id. at 866, 867. 4038 Id. at 869. 4039 Id. at 871.
773 Although Alabama argued that motor carriers and rail carriers pay roughly the same amount in taxes in spite of the difference in the form of taxation, the state failed to justify why the rail carrierâs competitors were exempt from the four percent sales tax.4040 This case, then, becomes much simpler than it would appear at first blush. Rail carriers pay the Stateâs sales tax--motor and water carriers do not. It is not a sufficient justification for the State to counter that its tax code will ultimately level the playing field.4041 On July 1, 2014, the Supreme Court granted certiorari.4042 2. Second Reversal and Remand by the Supreme Court On March 4, 2015, in an opinion by Justice Scalia, the Supreme Court reversed and remanded the case for the second time.4043 First, the Court agreed with the Eleventh Circuit that âa comparison class of competitors consisting of motor carriers and water carriers was appropriate[] and differential treatment vis-à -vis that class would constitute discrimination.â4044 Second, however, the Court held that it was improper for the Eleventh Circuit to refuse to consider Alabamaâs alternative tax justifications: We think that an alternative, roughly equivalent tax is one possible justification that renders a tax disparity nondiscriminatory. ⦠It is undoubtedly correct that the âtaxâ (singular) must discriminate--but it does not discriminate unless it treats railroads differently from other similarly situated taxpayers without sufficient justificationâ¦. 4040 Id. 4041 Id. 4042 Ala. Depât of Revenue v. CSX Transp., Inc., 134 S. Ct. 2900, 189 L. Ed.2d 854 (2014). 4043 Ala. Depât of Revenue v. CSX Transp., 135 S. Ct. 1136, 191 L. Ed.2d 113, 2015 U.S. LEXIS 1739, at *1 (U.S., Mar. 4, 2015). 4044 Id., 135 S. Ct. at 1143, 191 L. Ed.2d at 122, 2015 U.S. LEXIS 1739, at *14.
774 There is simply no discrimination when there are roughly comparable taxes.4045 The Court remanded the case to the Eleventh Circuit for âfor that court to consider whether Alabamaâs fuel-excise tax is the rough equivalent of Alabamaâs sales tax as applied to diesel fuel, and therefore justifies the motor carrier sales-tax exemption.â4046 E. Privately Owned, Unaffiliated Companies not are Protected by the 4R Act The 4R Actâs bar on discriminatory taxes against rail carriers does not extend to privately owned companies when the challenged tax is not one that is imposed on a railroad company. In Midwest Railcar Repair, Inc. v. South Dakota Depât of Revenue & Regulation4047 a railcar repair company brought an action against the South Dakota Department of Revenue & Regulation. The Midwest Railcar Repair (Midwest) argued that the sales and complementary use tax that the revenue department imposed on Midwestâs repair services violated the 4R Act because the tax was âtantamount to imposing âanother tax that discriminates against a rail carrier.ââ4048 The Eighth Circuit held, however, that the only entities that come within the protection of the 4R Act are railroads or âother entities that can show âthat because of the close relationship between [themselves] and common carriers by railroad, tax discrimination against [the non-railroad entities] results in discriminatory treatment of common carriers by railroad.ââ4049 Therefore, 4045 Id., 135 S. Ct. at 1143â44, 191 L. Ed.2d at 122-123, 2015 U.S. LEXIS 1739, at *15, 16. 4046 Id., 135 S. Ct. at 1144, 191 L. Ed.2d at 123, 2015 U.S. LEXIS 1739, at *16. 4047 659 F.3d 664 (8th Cir. 2011). 4048 Id. at 665-666 (citation omitted). 4049 Id. at 669 (quoting Trailer Train Co. v. State Board of Equalization, 710 F.2d 468, 471 N 5 (8th Cir. 1983) (emphasis in original).
775 entities protected by the 4R Act may include adjuncts or corporate subsidiaries but not âunaffiliated enterprises that merely provide[] railcar repair services.â4050 Statutes F. Reorganizing Railroads Required to Pay Taxes Due to the State Railroads undergoing reorganization due to bankruptcy are barred from withholding taxes owed to any state.4051 In 1975, Congress enacted the Regional Rail Reorganization Act Amendments (RRRA Amendments) in order ââto provide emergency financial assistance to bankrupt rail carriers in the Northeast and Midwest in order to continue essential rail services.ââ4052 The goal of the RRRA Amendments was âto prevent the imminent cessation of rail service for lack of cash.â4053 Although apparently a rarely used provision in the 4R Act, § 794 of the RRRA Amendments require that a portion of the monies collected from the debtor railroadâs tenants be used to pay the railroadâs portion of tax owed to a state or its political subdivision.4054 Railroads that withhold any portion of a tax owed to a state that has been collected from its tenants are subject to a fine of ânot more than $10,000 for each such violation.â4055 4050 Id. at 670. 4051 45 U.S.C. § 794 (2014). 4052 In re Pa. Cent. Transp. Co., 402 F. Supp. 106, 107 (E.D. Penn. 1975) (quoting House Committee, 94th Cong., Rep. on Interstate and Foreign Commerce 3 (1975)). 4053 Id. at 109. 4054 45 U.S.C. § 794(a) (2014). 4055 45 U.S.C. § 794(b) (2014).
776 G. Tax Liability for Trustees of Railroads Undergoing Reorganization Receivers or trustees of railroads undergoing reorganization must pay taxes when the railroad is still being operated as though it were conducted by an individual or corporation.4056 Federal law states that âofficers and agents conducting any business under authority of a United States court shall be subject to all Federal, State and local taxes applicable to such business to the same extent as if it were conducted by an individual or corporation.â4057 However, there are exceptions for specific situations, such as when the tax is a property tax secured by a lien against abandoned property4058 or the payment of the tax is otherwise excused under a specific provision of Title 11.4059 Article H. The 4R Act within the Context of the Commerce Clause The 4R Act is said to be best understood in the context of the Commerce Clause. However, an article in the Michigan State Law Review argues that Congress acts âoutside the scope of [its broad] power when it preempts a state tax that does not reflect economic protectionism.â4060 The author argues that [m]ost of the recently proposed Congressional preemptions fall into this latter category, as they purport to preempt state taxes as applied to a specific industry merely on the theory that state taxes apply more heavily to that industry-i.e., a 4056 See 28 U.S.C. § 960(a) (2014); Lyford v. New York, 140 F.2d 840 (2d Cir. 1944). 4057 28 U.S.C. § 960(a) (2014). 4058 28 U.S.C. § 960(b)(1) (2014). 4059 28 U.S.C. § 960(b)(2) (2014). 4060 Michael T. Fatale, âCommon Sense: Implicit Constitutional Limitations on Congressional Preemptions of State Tax,â 2012 Mich. St. L. Rev. 41, 46 (2012).
777 supposed âdiscriminationâ as between types of industries-and not because the state is favoring in-state commercial interests.4061 The article discusses the Commerce Clauseâs impact on the 4R Act and focuses on Congressâs unique treatment of railroads.4062 Although the article considers the 4R Act to be one that addresses economic protectionism, the author does conclude that Congressâs treatment of railroads under the Act is more consistent with the historic application of the Commerce Clause rather than an unjustified usurpation of state power.4063 The author observes that the protection of âinterstate transportationâ is one of the rare areas where the Supreme Court âappears to do more under the dormant Commerce Clause than merely suppress state protectionism,â likely because âthere is a genuine ⦠national interest in the existence of an effective transportation network linking the statesâ even though the âConstitution does not say that explicitly.â4064 The article argues that there is a tendency for Congress to preempt state taxes because of the absence of âstated judicial rules that specifically impose limitations on such federal preemptions.â4065 The absence of specific limitations creates unchecked Congressional âcapacity to preempt state taxes.â4066 The author argues that the Commerce Clause should be construed in a manner that respects both federal and state power.4067 4061 Id. 4062 Id. at 100. 4063 Id. at 100-101. 4064 Id. (quoting Donald H. Regan, âThe Supreme Court and State Protectionism: Making Sense of the Dormant Commerce Clause,â 84 Mich. L. Rev. 1091, 1182-84 (1986)). 4065 Id. at 102. 4066 Id. 4067 Id.
778 XXXVII. RAILROAD UNEMPLOYMENT INSURANCE ACT A. Introduction This part of the report discusses statutory provisions, cases, and articles on the Railroad Unemployment Insurance Act (RUIA). As the IRS has explained, the RUIA is an unemployment and sickness insurance benefit program for railroad workers.4068 The Railroad Retirement Board (RBB) administers the RUIA.4069 Section B discusses the RUIA, benefits payable under the Act, and conditions to receiving benefits. Sections C through G discuss what constitutes an employer under the Act, whether an employeeâs receipt of severance pay disqualifies the employee from receiving RUIA benefits, whether an employee who refuses to return to work may receive benefits, whether an employee may collect a state pension as well as RUIA benefits, and whether double beneficiaries under the RUIA and the Social Security Act lose one hundred percent of an overpayment. Finally, Sections H and I discuss two articles, one on the history of railroad unemployment insurance, and the other on trends in railroad unemployment insurance with a comparison of the federal program to state unemployment insurance. 4068 IRS RRTA Desk Guide, supra note 3985. 4069 Id.
779 Statutes and Regulations B. Railroad Unemployment Insurance Act 1. Benefits under the RUIA Under the RUIA any qualified employee who has been unemployed for over four days in a registration period is entitled to receive benefits.4070 However, if an employeeâs unemployment is because of a strike the employee is not entitled to benefits for the first fourteen days of unemployment.4071 Sick days exceeding four days in one registration period also require the payment of benefits.4072 An employee may receive benefits only for 130 sick days and 130 days of unemployment.4073 2. Qualified Employees and Willingness to Work under the RUIA Under the regulations an employee qualifies for coverage when the employee meets two requirements.4074 First, the employee must have earned at least two and one-half months pay during the year.4075 Second, if the employee did not receive compensation the previous year he or she must have received compensation in five months of the current year.4076 Moreover, the regulations provide that an employee may receive benefits for unemployment only if the 4070 45 U.S.C. § 352(a)(1)(A) (2014). 4071 Id. 4072 45 U.S.C. § 352(a)(1)(B) (2014). 4073 45 U.S.C. § 352(c) (2014). 4074 20 C.F.R. § 302.3(a) (2014). 4075 Id. 4076 Id.
780 employee is willing to work.4077 An employee is willing to work when the employee is âwilling to accept and perform for hire such work as is reasonably appropriateâ under the circumstances.4078 Cases C. Whether a Company Acting as a Dispatcher is an Employer under the RUIA In 1994 the Railroad Retirement Board (Board) declared that Herzog Transit Services, Inc. (Herzog), a commuter train operator, was not an employer as the term is defined under the RUIA.4079 In 2006, at the request of an employee of Herzog, after a hearing to determine whether Herzogâs status as an employer had changed,4080 the STB found that only Herzogâs dispatching unit was an employer under the Act.4081 In support of its decision, the Board considered the Federal Railroad Administrationâs (FRA) regulations that recognize that the role of dispatching is indispensible to carrier service.4082 Under the Railroad Retirement Act (RRA), an employer is defined in one of five ways.4083 The definition relevant to this case was that the term includes âany carrier by railroad 4077 20 C.F.R. § 327.1(2014). 4078 20 C.F.R. § 327.5(b) (2014). 4079 Herzog Transit Servs., Inc. v. U.S. R.R. Ret. Bd., 624 F.3d 467, 468 (7th Cir. 2010), rehearing, en banc, denied, 2011 U.S. App. LEXIS 618 (7th Cir., Jan. 3, 2011). 4080 Id. at 469. 4081 Id. 4082 Id. at 469-470. 4083 Id. at 472.
781 subject to the [STB].â4084 The Board reasoned that the parties before it and in other cases have assumed that the RUIA defines an employer in the same manner as the RRA.4085 The Board ruled that Herzogâs role as a dispatcher was integral to the operation of intrastate trains and, therefore, that Herzog was a rail carrier under the statute.4086 The Seventh Circuit upheld the Boardâs decision because it was consistent with the factors that the Board must consider in determining whether a company is covered by the Act.4087 The factors include the purpose of the company, the ratio of carrier business to other business, and the nature of the carrier business separate from other activities.4088 D. The Receipt of Severance Pay Bars an Employee from Receiving Benefits under the RUIA On August 18, 2000, after Phoebe Hudspeth, an employee of BNSF, was fired after she refused to sign a Resignation and Release Agreement with severance pay,4089 Hudspeth secured other employment. However, on August 24, 2001, after Hudspeth was terminated at her second job she signed the agreement previously offered to her by BNSF and received severance pay.4090 Hudspeth received unemployment benefits under the RUIA for a period of unemployment from 4084 Id. (quoting 45 U.S.C. § 235(a)(1)(i)). 4085 Id. 4086 Id. at 474. 4087 Id. at 475-476 (citing 20 C.F.R. § 202.3). 4088 Id. at 476. 4089 Hudspeth v. Railroad Retirement Board, 73 F. Appx. 191 (8th Cir. 2003). 4090 Id. at 191
782 February 26 to August 12, 2001.4091 Thereafter, Hudspeth was notified that she could not receive benefits when she already had received severance pay, a determination that the Board confirmed after the employee appealed.4092 Under the statute an employee may not receive benefits when the employee has received a separation allowance.4093 The Eighth Circuit affirmed the Boardâs ruling that severance pay the employee received was a âseparation allowanceâ that barred her from receiving other benefits.4094 E. Unemployment Benefits Unavailable to Workers who Refuse to Return to Work In Cobb v. Retirement Railroad Board,4095 Cobb, a train switchman, appealed a decision by the Retirement Railroad Board that found him ineligible for benefits because after his seniority was restored he still did not return to work and voluntarily quit his job.4096 The Retirement Railroad Board concluded that Cobbâs failure to return to work was ââa voluntary quitâ and that he could no longer rely on the continued prosecution of his claim against the Railway for reinstatement as a basis for eligibility for benefits.â4097 Therefore, to continue to receive unemployment benefits Cobb had to prove that he made good faith efforts to find 4091 Id. at 192. 4092 Id. 4093 Id. (quoting 45 U.S.C. § 354(a-1)(iii)). 4094 Id. 4095 431 F.2d 406 (5th Cir. 1970). 4096 Id. at 406-407. 4097 Id.
783 employment elsewhere and that he could not do so.4098 The court rejected Cobbâs argument that he could âcondition[] the âacceptanceâ of his restoration to seniority onâ receiving back pay and affirmed the Boardâs decision.4099 F. Employee may not Receive Benefits for Unemployment or Sickness while also Collecting a Social Insurance Benefit The RUIA prohibits providing unemployment or sickness benefits to an individual who is receiving any social insurance benefits under state or federal law. In Kaiser v. Railroad Retirement Board4100 the Board determined that Kaiserâs pension was a social insurance benefit under the laws of New York.4101 The court affirmed the Railroad Retirement Boardâs decision.4102 G. Recovery of Overpayments to Recipients under the Railroad Retirement Act and the Social Security Act are Limited to Fifty Percent of the Overpayment In Linquist v. Bowen4103 the plaintiff Linquist received survivor benefits under the Railroad Retirement Act (RRA) and benefits under the Social Security Act (SSA) for her own work.4104 Plaintiff Burns also received primary benefits under the SSA and survivor benefits 4098 Id. 4099 Id. at 408. 4100 264 F.2d 684 (2d Cir. 1959). 4101 Id. 4102 Id. at 687. 4103 633 F. Supp. 846 (W.D. Mo. 1986), affâd, 813 F.2d 884 (8th Cir. Mo. 1987), cert. denied, 488 U.S. 908, 109 S. Ct. 259, 102 L. Ed.2d 247 (1988), criticized in Action Alliance of Senior Citizens v. Leavitt, 483 F.3d 852 (D.C. Cir. 2007). 4104 Linquist, 633 F. Supp. at 850.
784 under the RRA.4105 Because they had received overpayments the plaintiffs were informed that they needed to return half of their overpayment.4106 Linquist appealed the Social Securityâs authority to take half of her overpayment after she had already paid half to the Board; Burns appealed the Boardâs authority to take half of her overpayment after she had already paid half to Social Security.4107 A Missouri federal district court dismissed all claims against the Board by Burns because she should have pursued those claims when she sought judicial review in a prior case against the Board; however, she âwill not be collaterally estopped from raising her due process and equitable estoppel claims against the Secretary.ââ4108 The court granted Linquistâs motion for class certification for all persons receiving benefits under both the SSA and RRA who are denied the right to receive half of their overpayment.4109 Neither the SSA nor the RRA specify how a deduction should be made if recipients are receiving benefits under both programs.4110 The court held that there should be coordination to ensure that beneficiaries âlose no more than $1 of benefits for each $2 of excess earnings.â4111 4105 Id. at 851. 4106 Id. 4107 Id. 4108 Id. at 857. 4109 Id. at 861. 4110 Id. at 862 4111 Id. at 866.
785 Articles H. History of Railroad Unemployment Benefits An article in the Yale Law Journal describes the history of railroad unemployment insurance.4112 At the time the Social Security Act was passed, Congress expected the RUIA also to come to fruition, something that happened in 1938.4113 The Act established a national insurance program for employees of railroad companies.4114 The Railroad Retirement Board oversees the national insurance system under the Act.4115 The Act required railroad carriers to contribute three percent.4116 The schedule of benefits required under the Act, initially between a $1.75 and $3.00 per day, was less than the amounts provided to employees under state laws.4117 However, Congress reformed the Act in 1940 so that the benefits afforded to railroad employees would be similar to the average benefits under state law.4118 The article explains why the Act was enacted separately from the Social Security Act or other unemployment insurance acts at the time. 4112 Edwin E. Witte, âDevelopment of Unemployment Insurance,â 55 Yale L. J. 21 (1945). 4113 Id. at 45. 4114 Id. 4115 Id. 4116 Id. 4117 Id. 4118 Id.
786 I. Trends in Railroad Unemployment Insurance An article in the Monthly Labor Review summarizes trends in the railroad unemployment insurance program.4119 RUIA has been providing rail workers with unemployment benefits since 1939 when Congress provided a program for railroad workers because the federal-state unemployment systems proved problematic for railroad workers who often crossed state lines for work.4120 Employers must âpay a tax on each workerâs earnings up to a certain limitâ and a workerâs benefits are based on his income in the calendar year prior to his claim.4121 The article states that the decline in railroad employment has led to more railroad employeesâ benefits under the RUIA.4122 Much of railroad traffic is seasonal because certain jobs relating to construction and maintenance require safe weather conditions and seasonal industries reduce their use of railroads in their off season.4123 Many beneficiaries tend to be repeat beneficiaries, a tendency suggesting that railroad employees may have trouble finding comparable work outside the railroad industry or fail to look beyond the rail industry for employment opportunities.4124 State unemployment compensation programs vary from state to state and in most instances railroad workers benefit more under the RUIA than they would have under a state 4119 Martha F. Riche, âRailroad Unemployment Insurance: Designed to Meet the Special Circumstances of Railroad Employment, the RUI System Provides some Interesting Contrasts with the State Plans,â 90 Monthly Lav. Rev. 9 (1967). 4120 Id. 4121 Id. 4122 Id at 10. 4123 Id at 11. 4124 Id. at 13.
787 plan.4125 The article states that â5 to 10 percent of RUIA beneficiaries are unemployed for reasons that would disqualify them for benefits under most State programs,â because state programs would not grant benefits to a worker who was âdischarged or suspended from his last job (particularly for misconduct), or was on strike.â4126 State programs do not offer minimum or maximum payments as high as those offered under the RUIA.4127 Benefits are granted to beneficiaries for a longer period of time under the RUIA than state programs.4128 Older beneficiaries are more likely to exhaust the benefits because they are less likely than younger railroad workers to find work in other industries.4129 One of the articleâs conclusions is that the program under the RUIA is superior to state programs but that railroad employment is likely to decline and that railroad employees should be offered relocation benefits to enable them to seek gainful employment elsewhere.4130 4125 Id. at 14. 4126 Id. at 15. 4127 Id. 4128 Id. at 17. 4129 Id. 4130 Id. at 18.
788 XXXVIII. STATE LAWS AND REGULATIONS ON RAILROADS A. Introduction Regulation of railroads is governed by federal and state statutes. Section B discusses some of the state laws applicable to railroads in the states of California, Illinois, New York, New Jersey, South Dakota, and Wisconsin. The state statutes cover a wide range of subjects such as fences to protect livestock from trains, the maintenance of sanitary conditions on trains, or the formation of a railroad corporation. Section C discusses miscellaneous state laws affecting railroads. Section D provides the name of and citation to railroad and related statutes in the ten largest or most populous states. Statutes B. State Statutes Applicable to Railroads 1. California Californiaâs constitution and its Public Utility Code are the main sources of California law on the regulation of railroads within the state.4131 California regulates corporations and persons that âown, operate, control, or manage a line, plant, or system for the transportation of people or property.â4132 a. California State Constitution Californiaâs Constitution states that railroads are subject to regulation by the state legislature.4133 4131 53 Cal. Jur., Railroad § 7 (2014). 4132 Id. 4133 Cal. Const, Art. XII § 3.
789 b. California Public Utilities Code Pursuant to its Public Utilities Code, California requires that when railroad tracks intersect with other railroad tracks âthe rails of either or each road shall be so cut and adjusted as to permit the passage of the cars on each road with as little obstruction as possible.â4134 Railroad companies in California are required to fence their tracks and property to prevent injury to domestic animals.4135 If a railroadâs failure to fence its tracks and property results in an injury to a domestic animal, the railroad company must pay the owner the fair market price of the animal unless the owner was at fault.4136 California regulates rail facilities that handle hazardous cargo by requiring that the facilities be designed for storage and have adequate security.4137 California criminalizes certain behavior related to railroads. For example, it is a misdemeanor to fail to use an audible warning device at a âdistance of at least 1,320 feet from [a] crossing[] and until the lead locomotive has passed through the crossing.â4138 It is a misdemeanor for certain railroad employees to become intoxicated while performing the duties of their employment.4139 4134 Cal. Pub. Util. Code § 7535 (2014). 4135 Cal. Pub. Util. Code § 7626 (2014). 4136 Id. 4137 Cal. Pub. Util. Code § 7665.6 (2014). 4138 Cal. Pub. Util. Code § 7678 (2014). 4139 Cal. Pub. Util. Code § 7679(2014); see 53 Cal. Jur. Railroads § 7.
790 2. Illinois The state of Illinois regulates railroads in chapter 610 of the Illinois Compiled Statutes; the city of Chicago regulates railroads pursuant to chapter 9-124 of its municipal code. a. Formation of a Railroad A railroad corporation may be formed in the state of Illinois when at least five people apply to do so.4140 Such a corporation is authorized to construct and operate a railroad in Illinois and is âauthorized and empowered to purchase, own, operate and maintain any railroad sold or transferred under order or powers of sale or judgment of, or sale under foreclosure of mortgage or deed of trustâ¦.â4141 Furthermore, corporations that were âheretofore organized under the provisions of the Act hereby amended, their successors or assigns, shall have and possess all the powers and privileges conferredâ by the said law.4142 Illinois also grants the power to every railway corporation formed in the state to survey land to determine where to locate its route; to purchase land; to construct a railway and stations and buildings necessary for a railway; to connect a railway with previously constructed railways; to regulate the transportation of passengers and property by rail; and to borrow money to construct and operate a railway.4143 4140 610 ILCS 5/1 (2014). 4141 Id. 4142 Id. 4143 610 ILCS 5/19 (2014).
791 b. Railroad Obstruction Act The Railroad Obstruction Act prohibits a locomotive engineer from willfully and maliciously abandoning a locomotive on a railroad.4144 Under the law it is also a misdemeanor for a person to obstruct or conspire to obstruct the operation of a railroad company.4145 c. Railroad Sanitation Act The Railroad Sanitation Act requires railroad owners or operators to provide clean and sanitary rail cars and requires that rail cars must be cleaned and fumigated regularly. d. Railroad Depot Act The Railroad Depot Act requires all railroads in Illinois to build and maintain depots in all towns of two hundred or more people where they receive passengers or freight.4146 3. New York In the state of New York, railroads are regulated by the Railroad Law, the Rapid Transit Law, and the common carrier provisions of the Transportation Law.4147 To avoid conflict the laws are to be interpreted together.4148 The New York Business Corporation Law governs railroad corporations that are formed under the Railroad Law.4149 Moreover, rail transportation 4144 610 ILSC 95/1 (2014). 4145 610 ILSC 95/2-3 (2014). 4146 610 ILSC 55/1 (2014). 4147 89 N.Y. Jur., Rail Transportation § 5. 4148 Id. 4149 Id.
792 is regulated by administrative rules and regulations, as well as by the charter of the city of New York.4150 a. New York Railroad Law New York requires railroads to construct and maintain fences to prevent farm animals such as sheep, cattle, horses, and pigs from entering the railway.4151 If fences are not constructed or are not in good repair a railroad may be held liable for any damages to a domestic animal.4152 New York requires that in cities of more than one million inhabitants a railroad having an electrified third rail must build and maintain a fence along the boundary of its right of way.4153 The New York Railroad Law requires that all railroad employees on passenger trains or working in stations for passengers wear a badge on their hats that designates their employment and the initials of their railroad corporation.4154 The Railroad Law prohibits railroads from transporting passengers or goods unless the rail carrier has an operable communications system.4155 Railroads in New York must provide sanitary locomotives with potable drinking water and clean toilets that provide privacy to those using them.4156 The Railroad Law requires: Whenever the commissioner of transportation shall cause to be personally served upon any railroad corporation controlling any tunnel or part of a tunnel in this 4150 Id. 4151 N.Y. R.R. Law § 52 (2014). 4152 Id. 4153 N.Y. R.R. Law § 52-a (2014). 4154 N.Y. R.R. Law § 65 (2014). 4155 N.Y. R.R. Law § 54-a (2014). 4156 N.Y. R.R. Law § 77-c (2014).
793 state for the purpose of operating a railroad ⦠by delivering a copy ⦠of a notice or order of said commissioner of transportation, stating and specifying the structures to be erected, the manner, means, mechanical appliances and apparatus to be used in lighting or ventilating any tunnel or tunnels used by said corporation ⦠said corporation shall[] within thirty days ⦠cause said tunnel or tunnels so used by it as aforesaid to be lighted or ventilated, or both, in the manner ⦠pointed out in said notice or order.4157 b. New York Rapid Transit Law Each city in New York is required to have a board of transportation4158 that âis empowered to operate any railroad acquired, owned, constructed, or provided by such city in accordance with the provisions of [the] law.â4159 A board of transportation may purchase all materials necessary to operate and maintain a railroad.4160 c. New York Transportation Law The New York Commissioner of Transportation has jurisdiction over common carriers in the state, including railroads.4161 The Transportation Law requires common carriers to provide safe and adequate service for just and reasonable charges.4162 If a shipper has applied for a connection a railroad is required to provide a switch connection âwith a lateral line of railroad or a private side-track owned, operated or controlled byâ the shipper.4163 Unless authorized by 4157 N.Y. R.R. Law § 104 (2014). 4158 N.Y. Rapid Trans. Law § 10a (2014). 4159 N.Y. Rapid Trans. Law § 30 (2014). 4160 Id. 4161 N.Y. Transp. Law § 80(1) (2014). 4162 N.Y. Transp. Law § 96 (2014). 4163 N.Y. Transp. Law § 97(1) (2014).
794 another section of the Transportation Law, common carriers may not discriminate by charging different amounts to passengers or shippers when performing a âlike and contemporaneous service.â4164 4. New Jersey The Transportation Act of 1966 established New Jersey Department of Transportation (NJDOT).4165 As head of NJDOT, the Commissioner of Transportation is authorized to: Plan, design, construct, equip, operate, improve and maintain, either directly or by contract with any public or private entity, a railroad, subway, street traction or electric railway, or connecting roadways and facilities for the purpose of carrying freight in this State or between this State and points in other states; Acquire by purchase, condemnation, lease, gift or otherwise, on terms and conditions and in the manner he deems proper, any land or property, real or personal, tangible or intangible, which he may determine is reasonably necessary for the purposes of this section; Lease as lessor, sell or otherwise dispose of, on terms and conditions which he may prescribe as appropriate, real and personal property....(sic)4166 5. South Dakota South Dakota is an example of a state having statutes that govern the duties and liability of railroad companies with tracks adjacent to private property. State laws requiring the fencing of railroads are not preempted by federal law.4167 A South Dakota statute requires railroads to provide an owner of adjacent land with the materials needed to construct a fence, and, if the landowner has livestock, a railroad must construct a fence to prevent livestock from trespassing 4164 N.Y. Transp. Law § 101 (2014). 4165 N.J. Stat. Ann. § 27:1A-2 (2014). 4166 N.J. Stat. Ann. § 27-1a-5.1a-c (2014). 4167 See Lin v. Amtrak, 2002 Conn. Super. LEXIS 501 (Conn. Super. Ct. 2002) (holding that there is no express congressional intent to preempt state law regulating the fencing of railroads); State ex rel. Okla. Corp. Commân v. Burlington Northern, 24 P.3d 368 (Okla. Civ. App. 2000) (holding the Federal Rail Safety Act did not preempt Oklahoma laws requiring railroads to fence their rights-of-way and maintain them as well).
795 on railroad property.4168 The South Dakota statute also requires that a railroad maintain a supply of fencing materials.4169 Under South Dakota law, a railroad has forty-five days to supply materials and construct a fence after it has received notice from a landowner that the landowner has finished a portion of a fence.4170 When a railroad fails to comply with the aforementioned statutes, the railroad will be liable for the cost of the landownerâs materials that are needed to construct a fence and will be liable for all damages resulting from the railroad companyâs neglect or refusal to do so.4171 6. Wisconsin In Wisconsin, the boards of villages are authorized to request railroad companies to apply oil or water to their roadbeds to control dust.4172 Railroads are required to build and maintain fences and cattle guards as well as farm crossings.4173 Wisconsin requires railroad companies to provide certain safety information within forty- eight hours of applying pesticide to a right of way. A railroad must provide the following information in a central location accessible to railroad employees: the area where the pesticide is to be applied; the name of the pesticide; the time and date it will be applied; notice of any restrictions on entering the location where it is applied; a copy of the information listed on the 4168 S.D. Codified Laws § 49-16A-91 (2014). 4169 Id. 4170 S.D. Codified Laws § 49-16A-92 (2014). 4171 S.D. Codified Laws § 49-16A-93 (2014). 4172 Wis. Stat. § 61.44 (2014). 4173 Wis. Stat. § 192.33(1) (2014).
796 pesticide label; and emergency medical contact information.4174 Railroads are required to provide information about the pesticide to the public on its website and to train employees annually on pesticide safety.4175 C. Railroad and Related Statutes in the Ten Largest or Most Populous States This subpart of the Report provides a listing by name and citation of the railroad and related statutes in the ten most populous states, including some states whose laws were summarized in the preceding subparts of the Report. 1. California a. California High-Speed Rail Service, Cal. Pub. Util. Code, 185000, et seq. (2014) b. California Passenger Rail Financing Commission Act, Cal. Govât. Code § 92000, et seq. (2014) c. Peninsula Rail Transit District, Cal. Pub. Util. Code § 160000, et seq. (2014) d. Railroads, Cal. Pub. Util. Code § 7801, et seq. (2014) e. Railroad Corporations, Cal. Pub. Util. Code § 7503, et seq. (2014) f. Railroad Crossings, Cal. Pub. Util. Code § 1201, et seq. (2014) g. Resettlement of Street, Suburban and Interurban Railroad Franchises, Cal. Pub. Util. Code § 6451, et seq. (2014) 2. Florida a. Florida Public Service Commission, Fla. Stat. § 350.001, et seq. (2014) b. Railroads, Fla. Stat. § 351.03, et seq. (2014) 4174 Wis. Stat. §§ 94.697(2)(a)(2)-(7) (2014). 4175 Wis. Stat. §§ 94.697(2)(e)-(3) (2014).
797 3. Georgia a. Public Service Commission, Ga. Code Ann. § 46-2-20, et seq. (2014) b. Railroad Companies, Ga. Code Ann. § 46-8-20, et seq. (2014) c. Rapid Rail Passenger Service, Ga. Code Ann. § 46-8A-1, et seq. (2014) d. Transportation of Freight and Passengers Generally, Ga. Code Ann. § 46- 2-20 and § 46-9-1, et seq. (2014) 4. Illinois a. Bulk Grain Act, 610 Ill. Comp. Stat. Ann. 110/1, et seq. (2014) b. Elevated Railroad Approval Act, 610 Ill. Comp. Stat. Ann. 130/1, et seq. (2014) c. Railroad Bond Guarantee Act, 610 Ill. Comp. Stat. Ann. 65/1, et seq. (2014) d. Railroad Borrowing Act, 610 Ill. Comp. Stat. Ann. 20/1, et seq. (2014)2. e. Railroad Bridge Act, 610 Ill. Comp. Stat. Ann. 40/1, et seq. (2014) f. Railroad Company Charter Change Act, 610 Ill. Comp. Stat. Ann. 10/1, et seq. (2014) g. Railroad Consolidation Act, 610 Ill. Comp. Stat. Ann. 25/1, et seq. (2014) h. Railroad Depot Act, 610 Ill. Comp. Stat. Ann. 55/1, et seq. (2014) i. Railroad Director Residence Act, 610 Ill. Comp. Stat. Ann. 75/1, et seq. (2014) j. Railroad Employees Medical Treatment Act, 610 Ill. Comp. Stat. Ann. 107/1, et seq. (2014) k. Railway Employees Water Act, 610 Ill. Comp. Stat. Ann. 105/1, et seq. (2014) l. Railroad Incorporation Act, 610 Ill. Comp. Stat. Ann. 5/1, et seq. (2014) m. Railroad Interstate Line Consolidation Act, 610 Ill. Comp. Stat. Ann. 30/1, et seq. (2014)
798 n. Railroad Intoxicating Liquor Act, 610 Ill. Comp. Stat. Ann. 90/1, et seq. (2014) o. Railroad Lessees Act, 610 Ill. Comp. Stat. Ann. 45/1, et seq. (2014) p. Railroad Mooring Act, 610 Ill. Comp. Stat. Ann. 100/1, et seq. (2014) q. Railroad Motor and Aerial Transport Act., 610 Ill. Comp. Stat. Ann. 60/1, et seq. (2014) r. Railroad Obstruction Act, 610 Ill. Comp. Stat. Ann. 95/1, et seq. (2014) s. Railroad Operative Contract Act, 610 Ill. Comp. Stat. Ann. 35/1, et seq. (2014) t. Railroad Police Act, 610 Ill. Comp. Stat. Ann. 80/2, et seq. (2014) u. Railroad Powers Act, 610 Ill. Comp. Stat. Ann. 70/1, et seq. (2014) v. Railroad Sanitation Act, 610 Ill. Comp. Stat. Ann. 85/1, et seq. (2014) w. Railroad Stock Transfer Act, 610 Ill. Comp. Stat. Ann. 15/1, et seq. (2014) x. Railroad Water Craft Act, 610 Ill. Comp. Stat. Ann. 50/1, et seq. (2014) y. Street Railroad Bridge Act, 610 Ill. Comp. Stat. Ann. 120/1 (2014) z. Street Railroad Right of Way Act, 610 Ill. Comp. Stat. Ann. 115/1, et seq. (2014) aa. Street Railroad Vestibule Act, 610 Ill. Comp. Stat. Ann. 125/1, et seq. (2014) 5. Michigan a. Consolidation of Public Utility Companies, Mich. Comp. Laws Serv. § 473.1, et seq. (2014) b. Railroads, Mich. Comp. Laws Serv. § 462.2, et seq. (2014) c. Street Railways, Mich. Comp. Laws Serv. § 472.1, et seq. (2014)
799 6. New York a. The Railroad Law, N.Y. R.R. Law § 1, et seq. (2014) b. The Rapid Transit Law, N.Y. Rapid Trans. Law § 1, et seq. (2014) c. Transportation Law, N.Y. Transp. Law § 1, et seq. (2014) 7. North Carolina a. Railroads, N.C. Gen. Stat. § 136-190, et seq. (2014) b. Railroad Revitalization, N.C. Gen. Stat. § 136-44.35, et seq. (2014). 8. Ohio a. Consolidation of Railroads, Ohio Rev. Code Ann. § 4967.01, et seq. (2014) b. Crimes Relating to Railroads, Ohio Rev. Code Ann. § 4999.01, et seq. (2014) c. Elimination of Crossings, Ohio Rev. Code Ann. § 4957.01, et seq. d. Employees; Policemen, Ohio Rev. Code Ann. § 4973.01, et seq. (2014) e. Grade Crossings, Ohio Rev. Code Ann. § 5523.01, et seq. (2014) f. Passenger Fares, Ohio Rev. Code Ann. § 4965.50, et seq. (2014) g. Public Utilities Commission -- Railroad Powers, Ohio Rev. Code Ann. § 4907.01, et seq. (2014) h. Rail Development Commission, Ohio Rev. Code Ann. § 4981.01, et seq. (2014) i. Railroad Sales; Railroad Receivers, Ohio Rev. Code Ann. § 4969.01, et seq. (2014) j. Reorganization of Railroads, Ohio Rev. Code Ann. § 4971.01, et seq. (2014) k. Right of Way Drainage and Fences, Ohio Rev. Code Ann. § 4959.01, et seq. (2014)
800 l. Special Powers of Railroads, Ohio Rev. Code Ann. § 4961.01, et seq. (2014) m. Street Railways and Interurban Railroads, Ohio Rev. Code Ann. § 4951.01, et seq. (2014) n. Tracks; Crossings, Ohio Rev. Code Ann. § 4955.10, et seq. and § 4955.41, et seq. o. Trains; Equipment, Ohio Rev. Code Ann. § 4963.01, et seq. (2014) 9. Pennsylvania a. Common Carriers, 66 Pa. Cons. Stat. §2301, et seq. (2014) b. Metropolitan Transportation Authorities, 74 Pa. Cons. Stat. § 1701, et seq. (2014) c. Railroads, 66 Pa. C. S. § 2701, et seq (2014). 10. Texas a. Commuter Rail Districts, Tex. Transp. Code § 174.001, et seq. (2014) b. Engineerâs Operator Permit and Train Operator Permit, Tex. Transp. Code § 192.001, et seq. (2014) c. Freight Rail Districts, Tex. Transp. Code § 171.001, et seq. (2014) d. General Provisions, Tex. Transp. Code § 81.001, et seq. (2014) e. Hazardous Materials, Tex. Transp. Code § 193.001, et seq. (2014) f. Intermunicipal Commuter Rail Districts, Tex. Transp. Code § 173.001, et seq. (2014) g. Miscellaneous Provisions, Tex. Transp. Code § 199.001 (2014) h. Miscellaneous Railroads, Tex. Transp. Code § 131.001, et seq. (2014) i. Powers and Duties of Railroads, Tex. Transp. Code § 112.001, et seq. (2014) j. Provision of Utilities by Certain Railway Corporations, Tex. Transp. Code § 194.001, et seq. (2014)
801 k. Rail Facilities, Tex. Transp. Code § 91.001, et seq. (2014) l. Regulation by Texas Department of Transportation, Tex. Transp. Code § 111.001, et seq. (2014) m. Rural Rail Transportation Districts, Tex. Transp. Code § 172.001, et seq. (2014) n. Structures and Materials near Railroad or Railway, Tex. Transp. Code § 191.001, et seq. (2014)
802 XXXIX. SURFACE TRANSPORTATION BOARD A. Introduction The Surface Transportation Board (STB or Board),4176 created by the 1995 Interstate Commerce Commission Termination Act (ICCTA), is the successor to the Interstate Commerce Commission (ICC).4177 Section B reviews the Boardâs regulatory and adjudicatory powers. Section C discusses the Boardâs jurisdiction over the construction, acquisition, operation, abandonment, or discontinuance of railroad lines; its jurisdiction over rates and classifications; and its authority to prescribe rules and practices. Section D discusses some of the Boardâs recent decisions, such as on what constitutes a rail line or whether a transload facility is subject to STB jurisdiction. Sections E and F discuss judicial review of STB orders. Statutes B. Surface Transportation Boardâs Regulatory and Adjudicatory Powers The STB is an economic regulatory agency created by Congress to resolve issues and disputes concerning railroad rates and service and to review proposed railroad mergers, as well as other matters discussed below. Although the STB is affiliated administratively with the United States Department of Transportation (DOT), the Board makes decisions independently of the DOT. 4176 49 U.S. Code § 701, et seq. (2014). 4177 Pub. L. 104-88 (Dec. 29, 1995), summary available at Govtrack.us: https://www.govtrack.us/congress/bills/104/hr2539/summary (last accessed March 31, 2015).
803 The STB, both a regulatory and an adjudicatory body, has jurisdiction over issues pertaining to railroad rates and service and the restructuring of railroads, such as mergers, sales of lines, construction of line, and abandonment of lines.4178 The STBâs jurisdiction extends to the structure, financing, and operations of intercity passenger bus companies, and certain rate matters pertaining to trucking companies, moving vans, non-contiguous ocean shipping companies, as well as the rates and services of certain pipelines not regulated by the Federal Energy Regulatory Commission.4179 After the Board has approved or exempted a transaction the participating rail carriers âmay carry out the transaction, own and operate property, and exercise control or franchises acquired through the transaction without the approval of a State authority.â4180 After the STB approves a transaction, a rail carrier is exempt from state and municipal laws that would inhibit the carrierâs operation of its property.4181 However, when a purchase, lease, sale, consolidation, 4178 49 U.S. Code § 10501 (2014) (general jurisdiction); 49 U.S. Code § 10901 (2014) (authorizing of construction and operation of railroad lines). 49 U.S. Code § 10903 (2014) (filing and procedure for application to abandon or discontinue); 49 U.S. Code § 10905 (2014) (offering abandoned rail properties for sale for public purposes); and 49 U.S. Code § 10907 (2014) (railroad development). 49 U.S.C. § 10501(b)(1) states that the Boardâs jurisdiction is âexclusiveâ over the (1) transportation by rail carriers, and the remedies provided in this part with respect to rates, classifications, rules (including car service, interchange, and other operating rules), practices, routes, services, and facilities of such carriers; and (2) the construction, acquisition, operation, abandonment, or discontinuance of spur, industrial, team, switching, or side tracks, or facilities, even if the tracks are located, or intended to be located, entirely in one Stateâ¦. 4179 United States Department of Transportation, Surface Transportation Board, available at: http://www.stb.dot.gov/stb/about/overview.html (last accessed March 31, 2015). 4180 49 U.S.C. § 11321(a) (2014). 4181 Id.
804 or merger of a corporation is involved in a transaction, the transaction must be approved by a majority of the corporationâs stockholders or by the number required by state law.4182 The Boardâs decisions may be located by accessing the STB website and clicking Decisions under QuickLinks on the right hand side of the page.4183 The Board has the authority to subpoena witnesses and records related to a Board proceeding; in a proceeding the Board may depose witnesses and order them to produce records.4184 The Board may âat any time on its own initiative because of material error, new evidence, or substantially changed circumstances-- reopen a proceeding; grant [a] rehearing, reargument, or reconsideration of an action of the Board; or change an action of the Board.â4185 The Board may begin an investigation of a rail carrier after a person has filed a complaint that a rail carrier providing transportation or service under the Boardâs jurisdiction has committed a violation of 49 U.S.C. § 10101, et seq.4186 When there is a violation, the Board is authorized to compel the rail carrierâs compliance.4187 4182 Id. 4183 United States Department of Transportation, Surface Transportation Board, available at: http://www.stb.dot.gov/stb/index.html (last accessed March 31, 2015). 4184 49 U.S.C. §§ 721(c)-(d) (2014). 4185 49 U.S.C. §§ 721(c)(1)-(3) (2014). 4186 49 U.S.C. §§ 11701(a)-(b) (2014). 4187 49 U.S.C. § 11701(a) (2014).
805 C. Surface Transportation Boardâs Jurisdiction 1. STBâs Exclusive Jurisdiction over the Construction, Acquisition, Operation, Abandonment, or Discontinuance of Railroad Lines The STB has exclusive jurisdiction over the construction, acquisition, operation, abandonment, or discontinuance of railroad lines.4188 As provided in 49 U.S.C. §§ 10901 (a)(1)- (4), a person may construct an extension to any of its railroad lines, construct an additional line, or provide transportation over or by means of an extended or additional line, or, in the case of a person other than a rail carrier, acquire a railroad line or acquire or operate an extended or additional railroad line âonly if the Board issues a certificate authorizing such activityâ under subsection (c). Under § 10901(b) a proceeding to grant such authority begins with the filing of an application with the Board that is followed by the Boardâs giving of âreasonable public notice, including notice to the Governor of any affected Stateâ¦.â4189 Under subsection (c) of the statute â[t]he Board shall issue a certificateâ granting such authority as requested âunless the Board finds that such activities are inconsistent with the public convenience and necessity.â4190 The Board may approve an application as it was filed, approve the application with modifications, or require the applicant to comply with certain conditions, such as for the protection of labor, that the Board finds to be necessary in the public interest. Under subsection (d)(1), when the Board issues a certificate that authorizes the construction or extension of a railroad line, no other rail carrier may block any construction or extension authorized by such certificate by refusing to permit the carrier to cross its property ifâ 4188 49 U.S.C. § 10501(b)(2) (2014). 4189 49 U.S.C. § 10901(b) (2014). 4190 49 U.S.C. § 10901(c) (2014).
806 (A) the construction does not unreasonably interfere with the operation of the crossed line; (B) the operation does not materially interfere with the operation of the crossed line; and (C) the owner of the crossing line compensates the owner of the crossed line.4191 It may be noted that if the âparties are unable to agree on the terms of operation or the amount of paymentâ either party may submit the dispute to the Board, which must determine the dispute within 120 days of the submission of the dispute to the Board.4192 2. Rates, Classifications, Rules, and Practices Prescribed by the STB The STB has the authority to regulate rates charged by railroads for transportation.4193 After conducting a full hearing the STB may prescribe a maximum rate, classification, rule, or practice that is to be followed.4194 The Board may order a rail carrier to stop a violation associated with a rate, classification, rule, or practice.4195 The Board is authorized to determine whether a carrier is earning an adequate revenue and âshall make an adequate and continuing effort to assist those carriers in attainingâ adequate ârevenue levels.â4196 Adequate revenue levels are defined as those that provide a flow of net income plus depreciation adequate to support prudent capital outlays, assure the repayment of a reasonable level of debt, permit the raising of needed equity capital, and cover the effects of inflation; and attract and retain 4191 49 U.S.C. § 10901(d)(1)(A)-(C) (2014). 4192 49 U.S.C. § 10901(d)(2) (2014). 4193 49 U.S.C. § 10704(a)(1) (2014). 4194 Id. 4195 Id. 4196 49 U.S.C. § 10704(a)(2) (2014).
807 capital in amounts adequate to provide a sound transportation system in the United States.4197 The STB has the authority to regulate and approve rate agreements made between railroads to ensure that the railroads are not colluding in charging shippers an unreasonable rate.4198 The STB is also empowered to exempt rate agreements from federal and state antitrust laws.4199 Cases D. Surface Transportation Board Decisions 1. What Constitutes a Rail Line Subject to the Surface Transportation Boardâs Jurisdiction? In Brotherhood of R.R. Signalmen v. Surface Transp. Bd.4200 a group of unions petitioned the STB to review its decision that the Massachusetts Department of Transportationâs (MassDOT) purchase of railroad track and other assets from CSX Transportation, Inc. should not have been exempted under the ICCTA from the âstatutory requirement that a âperson other than a rail carrierâ obtain a certification of authorization in order to âacquire a railroad line.ââ4201 The plaintiffs argued that because MassDOT purchased more than seventy miles of track and real estate, rights-of-way, and other property rights, MassDOTâs actions constituted a purchase of a railroad line under 49 U.S.C. § 10901(a)(4) and, therefore, were subject to the STBâs 4197 49 U.S.C. §§ 10704(a)(2)(A)-(B) (2014). 4198 49 U.S.C. 10706(a)(2)(A) (2014). 4199 Id. 4200 638 F.3d 807 (D.C. Cir. 2011), rehearing, en banc, denied, 2011 U.S. App. LEXIS 26370 (D.C. Cir., May 5, 2011). 4201 Id. at 810 (quoting 49 U.S.C. § 10901(a)(4)).
808 authorization.4202 The court held that the STBâs decision to grant MassDOT an exemption, the decision that the unions were appealing, was reasonable under a Chevron analysis.4203 The STBâs interpretation both of the statute and the term railroad line were held to be reasonable; thus, the court upheld the STBâs decision granting an exemption.4204 2. Whether a Transload Facility is Subject to the Surface Transportation Boardâs Jurisdiction In New York & Atl. Ry. Co. v. Surface Transp. Bd.4205 a local township petitioned the court to review three STB orders that ruled that a transload facility in the city of Babylon was not under the STBâs exclusive jurisdiction, was not entitled to federal preemption, but was subject to local regulation.4206 The respondents argued that the ICCTA did not preempt local zoning laws.4207 The New York & Atlantic Railway Company (NYAR) transported waste to the facility owned by Coastal Distribution, LLC (Coastal).4208 The STB has held consistently that it does 4202 Id. at 810. 4203 Id. at 813. As explained by a federal district court in the District of Columbia in Prime Time Intâl Co. v. Vilsack, 930 F. Supp.2d 240, 248 (D.D.C. 2013), a court must review an agencyâs interpretation of a statute under the framework set forth by the Supreme Court in Chevron v. N.R.D.C., 467 U.S. 837, 104 S. Ct. 2778, 81 L. Ed.2d 694 (1984). âThe threshold inquiry ⦠is determining whether Congress has delegated interpretive authority to the agency in question.â Prime Time Intâl Co. 930 F. Supp.2d at 248 (citations omitted). If so, the Chevron analysis next ârequires âthat both the agency and the courts give effect to Congressâs unambiguously expressed intent if the underlying statute speaks directly to the precise question at issue.ââ Id. (citation omitted). When a statute is clear, the âunambiguous intent of Congressâ controls and Chevron inquiry is complete. Id. On the other hand, when a statute is silent or ambiguous on an issue and the agencyâs interpretation is reasonable, the reviewing court may not substitute its judgment for the agencyâs and must defer to the agencyâs reasonable interpretation. Id. 4204 Id. at 809. 4205 635 F.3d 66 (2d Cir. 2011). 4206 Id. at 68. 4207 Id. at 69. 4208 Id.
809 not have jurisdiction over a matter unless a rail carrier is engaged in transportation activity.4209 Although the railroadâs actions constituted transportation, the court held that Coastal was not a rail carrier.4210 Nevertheless, the STBâs jurisdiction âextends to the rail-related activities that take place at transloading facilities if the activities are performed by a rail carrier or the rail carrier holds out its own service through the third-party as an agent or exerts control over the third-partyâs operations.â4211 Neither was NYAR controlling the activities of Coastal nor was Coastal acting as NYARâs agent; therefore, Coastal was not subject to the STBâs exclusive jurisdiction.4212 Holding that the STBâs decision was neither arbitrary nor capricious, the Second Circuit upheld the Boardâs ruling.4213 3. No STB Jurisdiction over Proposed Intrastate Passenger Rail Service in Florida In All Aboard Florida â Operations LLC and All Aboard Florida â Stationsâ Construction and Operation Exemptionâin Miami, Fla. and Orlando, Fla.,4214 All Aboard Florida - Operations LLC (AAF-O) and its corporate affiliate, All Aboard Florida - Stations LLC (AAF-S) (collectively referred to as AAF), filed a petition with the Board for an exemption from the prior approval requirements of 49 U.S.C. § 10901 to construct and operate approximately 230 miles of passenger rail line between Miami, Fla., and Orlando, Fla. (the Line). Together 4209 Id. at 72. 4210 Id. 4211 Id. at 73 (internal citation omitted). 4212 Id. 4213 Id. 4214 Surface Transportation Board, Docket No. FD 35680, at 1 (Service Date, December 21, 2012).
810 with the petition AAF moved to dismiss for lack of jurisdiction on the ground that âthe Line would be located entirely within the state of Florida and would not be part of the interstate rail network.â4215 The Board noted its jurisdiction under 49 U.S.C. § 10501(a)(2)(A) over transportation by rail carriers (1) between a place in a state and a place in another state, and (2) between a place in a state and another place in the same state, as long as that intrastate transportation is carried out as âpart of the interstate rail network.â4216 The Board further noted that its decision on whether the proposed intrastate passenger rail service was part of the interstate rail network was âa fact-specific determination.â 4217 AAF explained that 200 miles of the Line would be âbuilt and operated within the existing [Florida East Coast Railway LLC (FECR)] right-of-way along the east coast of Florida (the FEC Corridor), alongside FECRâs existing tracks.â4218 Furthermore, AAF had petitioned the Board because it was seeking financing under the FRAâs Railroad Rehabilitation and Improvement Financing (RRIF) program and the proceeding was âa prerequisite for FRA to act on AAFâs RRIF application.â4219 The AAFâs position was that the Board did not have jurisdiction because the proposed Line would ânot be âpart of the interstate rail networkââ and âwould not connect with AMTRAK or any other interstate passenger rail provider.â4220 4215 Id. 4216 Id. at 3 (citation omitted). 4217 Id. 4218 Id. at 2. 4219 Id. at 3. 4220 Id.
811 The Board agreed that it lacked jurisdiction. The Board also stated that âthe proximity of a planned station at or near an airport [did] not make the proposed intrastate passenger rail service a part of the interstate rail network,â nor did âFECRâs plan to dispatch AAFâs trains together with its own freight services within the FEC Corridor ⦠make AAFâs proposed operationsâ subject to the Boardâs jurisdiction.4221 A dissenting opinion by the Boardâs Vice Chairman argued that the proposed Line was âclearly related to the movement of passengers in interstate commerce.â4222 4. Recent Board Decision on an Exemption In City of Belfast, Maine--Abandonment Exemption--In Belfast, ME4223 the STB first granted the City of Belfast an exemption from the prior approval requirements to abandon two miles of a rail line.4224 After the Belfast and Moosehead Lake Railroad (BMLRR) sold a portion of its line to the State of Maine in 1995, the line was conveyed eventually to Belfast in 2010.4225 The STB must exempt a transaction from regulation when regulation is not necessary to further the nationâs rail transportation policy.4226 The line was only used for intrastate tourist purposes 4221 Id. at 4. 4222 Id. at 5 (Mulvey, Vice Chairman, dissenting). 4223 2014 STB LEXIS 110, also available at: http://www.stb.dot.gov/decisions/readingroom.nsf/fc695db5bc7ebe2c852572b80040c45f/f93f3a565a22df 0085257cca004ec643?OpenDocument (last accessed March 31, 2015). 4224 Belfast, 2014 STB LEXIS 110, at *1. 4225 Id. at *2-3. 4226 Id. at *3-4; see 49 U.S.C. § 10502 (2014).
812 and had not been used for freight services since 1996.4227 The STB granted the exemption âsubject to trail use, environmental, and standard employee protective conditions.â4228 5. Railroads Ordered to Provide Weekly Reports In another recent decision, United States Rail Service Issues,4229 the STB ordered Canadian Pacific and BNSF to send the STB weekly reports of their fertilizer shipment delivery plans.4230 The reports must be sent for six weeks beginning April 25, 2014.4231 The STB made its decision after testimony by farmers and agricultural producers at a hearing in which they stated they would not be able to begin planting their spring crops without timely delivery of fertilizer.4232 6. STB Decision on Demurrage Rules The STB recently adopted final rules that address who may charge demurrage and who is subject to demurrage.4233 âDemurrage is a charge for detaining rail cars for loading or unloading beyond a specified amount of time called âfree time.ââ4234 Demurrage rules are applicable to 4227 Belfast, 2014 STB LEXIS 110, at *3-4. 4228 Id. at *2. 4229 2014 STB LEXIS 97, also available at: http://www.stb.dot.gov/decisions/readingroom.nsf/fc695db5bc7ebe2c852572b80040c45f/ad4c55d3da22d 5e985257cbb006e8cda?OpenDocument (last accessed March 31, 2015). 4230 Id. at *2. 4231 Id. 4232 Id. at *1. 4233 Demurrage Liability, 2014 STB LEXIS 89, also available at: http://www.stb.dot.gov/decisions/readingroom.nsf/fc695db5bc7ebe2c852572b80040c45f/a9a5fd9636dd9 82785257cb7004d8f3f?OpenDocument (last accessed March 31, 2015). 4234 Id. at *2.
813 âboth railroad-owned cars and privately owned cars when such privately owned cars are held on railroad property.â4235 The STB also removed the proposed agency exception rule that eliminated liability for demurrage for an agent receiving rail cars on behalf of another if the rail carrier has notice that the person is an agent and also knows the identity of the principal.4236 Article 7. STB ruling that the California High-Speed Rail Authority comes within the STBâs Jurisdiction An on line news article discusses a recent STB ruling that the California High-Speed Rail Authority comes within the STBâs jurisdiction.4237 Although high-speed rail will operate within California, the track will serve Amtrak trains as well.4238 Because Amtrak trains are part of the interstate rail networks, the STB has jurisdiction over the California High-Speed Rail Authority.4239 The Authority is seeking an exemption from the STBâs regulation.4240 Statute E. Judicial Review of STB Orders Federal law provides that âdistrict courts shall have jurisdiction of any civil action to enforce, in whole or in part, any order of the [STB] and to enjoin or suspend, in whole or in part, 4235 Id. at *33. 4236 Id. at *34-35. 4237 Kathy Hamilton, Surface Transportation Board Rules Against Rail Authority, Examiner (April 28, 2013), available at: http://www.examiner.com/article/surface-transportation-board-rules-against-rail- authority (last accessed March 31, 2015). 4238 Id. 4239 Id. 4240 Id.
814 any order of the [STB] for the payment of money or the collection of fines, penalties, and forfeitures.â4241 United States District Courts have jurisdiction âto enjoin or suspend, in whole or in part, a rule, regulation of the [STB].â4242 A party wishing to do so may appeal a decision by the STB to a United States district court within sixty days of the decision.4243 Case F. Judicial Denial of a Petition for Review In Riffin v. Surface Transp. Bd.4244 Riffin petitioned the District of Columbia Circuit to review an STB decision ârejecting his application for a certificate authorizing the acquisition and operation of a small length of industrial railroad track because his application refused any obligation to transport âtoxic inhalation hazardâ products.â4245 In previous decisions the Board had stated that railroads have a statutory obligation to transport hazardous materials and therefore any application seeking to exclude transporting a toxic inhalation hazard is inherently defective.4246 The Board also stated that a carrierâs common law right to determine the type of goods that it will or will not carry may not defeat the carrierâs statutory obligation to carry a toxic inhalation hazard.4247 The court denied the petition for review because the STBâs rejection of the application was reasonable.4248 4241 28 U.S.C. § 1336(a) (2014). 4242 28 U.S.C. § 2321 (2014). 4243 28 U.S.C. § 2344 (2014). 4244 733 Fed.3d 340 (D.C. Cir. 2013). 4245 Id. at 341. 4246 Id. at 342. 4247 Id. at 343.
815 XL. FIREARMS AND OTHER WEAPONS OR DEVICES ON RAILROADS A. Introduction This part of the Report discusses federal, as well as state, laws applicable to firearms and other weapons or devices on railroads. Section B discusses the Firearm Ownersâ Protection Act and its applicability to rail transportation. Under federal law a rail officer may carry a firearm; however, individuals or companies may not ship or transport firearms without a license.4249 Section C discusses Amtrak rules on the possession of firearms and other devices on its trains. Section D discusses laws that exist in numerous states that prohibit the possession and/or use of firearms and other weapons or devices on or near railroads. Sections E and F discuss cases on whether a former railroad employee may be denied benefits when fired for carrying a firearm and whether a railroad may be held liable when an employeeâs gun injures another employee. Statutes B. Applicability of the Firearm Ownersâ Protection Act to Rail Transportation Under the Firearm Ownersâ Protection Act (FOPA), it is unlawful for any person who is not licensed to deal with firearms or ammunition to ship, transport, or receive any firearm or ammunition in interstate commerce.4250 An exception in § 922 is that the statute does not apply to the transfer to or the possession of a gun by a police officer who is employed by a rail carrier.4251 Moreover, an individual must be certified or commissioned as a police officer under 4248 Id. at 348. 4249 18 U.S.C. § 922 (2014). 4250 18 U.S.C. §§ 922(a)(1)(A)-(B) (2014). 4251 18 U.S.C. § 922(z)(2)(B) (2014).
816 the laws of a state for the use of a handgun for the purpose of law enforcement.4252 FOPA prohibits âany common or contract carrier to transport or deliver in interstate or foreign commerce any firearm or ammunitionâ if the carrier knows or has reason to know âthat the shipment, transportation, or receipt thereof would be in violation ofâ FOPA.4253 Common carriers are prohibited from delivering a firearm in interstate or foreign commerce without obtaining written acknowledgement that the firearm package has been received.4254 Regulations C. Amtrakâs Rules on the Possession of Firearms and other Devices on Trains 1. Prohibition of Firearms and Other Devices As discussed in this and the next subpart, firearms and/or ammunition are prohibited onboard an Amtrak train but may be transported in checked baggage. However, Amtrak prohibits the transportation of black powder, percussion caps, or any ammunition used with a matchlock, flintlock, percussion-cap ignition system, or similar type, including self-loaded, gunpowder-based modern ammunition. The following items are also prohibited in be carried onto trains or to be placed in checked baggage: archery equipment, batteries with acid that can spill or leak; canisters, tanks, or other devices containing propellants, except certain oxygen equipment for medical reasons may be allowed onboard; corrosive or dangerous chemicals or materials, including but not limited to liquid bleach, tear gas, electronic control devices (e.g., stun guns, TASER guns), radioactive or harmful bacteriological materials; incendiaries, including but not limited to flammable gases, liquids, fuels, fireworks, and other explosive 4252 Id. 4253 18 U.S.C. § 922(f)(1) (2014). 4254 18 U.S.C. § 922(f)(2) (2014).
817 devices; and martial-arts and self-defense items, including but not limited to billy clubs, nightsticks, and nunchuks.4255 Amtrak also bans sharp objects such as axes, ice picks, knives, spears and swords on their trains, but scissors, nail clippers, corkscrews, and razors are allowed in carry-on baggage. Sheathed equipment, including fencing equipment, is also allowed to be transported in checked baggage.4256 Article 2. Amtrak Policy Permitting Firearms in Checked Baggage As explained in an on line article, in 2009 Congress allowed Amtrak, a government- owned corporation, to follow the same policy used by airlines regarding persons travelling with firearms.4257 Individuals may travel with guns as long as the guns are unloaded and stored in the locked baggage holds.4258 A passenger transporting a weapon also must inform Amtrak that he or she will be transporting a firearm and must complete a firearms-declaration prior to the day of departure.4259 4255 Amtrak, Prohibited Items, available at: http://www.amtrak.com/prohibited-items (last accessed March 31, 2015). 4256 Id. 4257 Manikandan Raman, âAmtrak to Allow Guns on Trains,â International Business Times (Dec. 1, 2010), available at: http://www.ibtimes.com/amtrak-allow-guns-trains-248972 (last accessed March 31, 2015). 4258 Id. 4259 Id.
818 Statutes D. State Laws Regulating the Transportation or Use of Weapons Directed against Railroads Some states have statutes that regulate the possession, transportation, or use of firearms or other devices on railroads.4260 In addition, some states prohibit firearms and other devices being directed at or near railroads. 1. Alabama In Alabama, [a]ny person, except a duly authorized law enforcement officer acting in the line of duty or person otherwise authorized by law, who hunts or discharges any firearm from, upon, or across any ... railroad, or the rights-of-way of any ... railroad, or any person, except a landowner or his or her immediate family hunting on land of the landowner, who hunts within 50 yards of a ... railroad, or their rights-of-way [with certain firearms] shall be guilty of a misdemeanor...4261 2. Arkansas In Arkansas, it is a misdemeanor to throw stones, sticks, clubs, or other missiles at, into, or against a train of any type.4262 3. Arizona In Arizona, â[a] person who knowingly discharges a firearm at a nonresidential structure is guilty of a class 3 felony.â The term structure is defined to include a railroad car.4263 4260 National Rifle Association of America, Institute for Legislative Action, Guide to the Interstate Transportation of Firearms, available at: http://www.nraila.org/gun-laws/articles/2010/guide-to-the- interstate-transportation.aspx (last accessed March 31, 2015). 4261 Ala. Code § 9-11-257 (2014). 4262 Ark. Code Ann. § 23-12-804 (2014). 4263 Ariz. Rev. Stat. §§ 13-1211(B) and (C)(3) (2014).
819 4. Illinois In Illinois, a person commits a criminal offense when he or she shoots a firearm at any portion of a railroad.4264 5. Iowa In Iowa, [a] person commits a class âCâ felony when the person, with the intent to injure or provoke fear or anger in another, shoots, throws, launches, or discharges a dangerous weapon at, into, or in a ... railroad engine [or] railroad car occupied by another person ⦠and thereby places the occupants or people in reasonable apprehension of serious injury or threatens to commit such an act under circumstances raising a reasonable expectation that the threat will be carried out.4265 Furthermore, [a] person commits a class âDâ felony when the person shoots, throws, launches, or discharges a dangerous weapon at, into, or in a building, vehicle, airplane, railroad engine, railroad car, or boat, occupied by another person ⦠and thereby places the occupants or people in reasonable apprehension of serious injury or threatens to commit such an act under circumstances raising a reasonable expectation that the threat will be carried out.4266 6. Florida In Florida, Title XLVI, Chapter 790 of the Florida Statutes provides that [w]hoever, wantonly or maliciously, shoots at, within, or into, or throws any missile or hurls or projects a stone or other hard substance which would produce death or great bodily harm, at, within ⦠any train, locomotive, railway car, 4264 720 Ill. Comp. Stat. Ann. 5/21-1(a)(7) (2014). 4265 Iowa Code § 708.6 (2014). 4266 Id.
820 caboose, cable railway car, street railway car, monorail car, or vehicle of any kind which is being used or occupied by any person ⦠shall be guilty of a felony of the second degreeâ¦.4267 7. Minnesota A Minnesota statute applies to various crimes committed against railroad employees and property, including action intended to cause a derailment or other forseeable risk of harm.4268 However, subdivision 3 of the statute applies to anyone who âintentionally shoots a firearm at any portion of a railroad train, car, caboose, engine or moving equipment so as to endanger the safety of anotherâ¦.â4269 8. Mississippi In Mississippi, although the statute does not mention firearms, a statute provides that â[i]t shall be unlawful for any person at any time to bomb, or to plant or place any bomb, or other explosive matter or chemical, biological or other weapons of mass destruction or thing in, upon or near any... railroad station, railroad car or coach....â4270 9. Missouri In Missouri is it is illegal to knowingly carry a concealed knife or other weapon âreadily capable of lethal force.â4271 4267 Fla. Stat. § 720.19 (2014). 4268 Minn. Stat. § 609.85, subdivs. 1 and 2 (2014). 4269 Minn. Stat. § 609.85, subdiv. 3 (2014). See also, Minn. Stat. § 609.85, subdivs. 4, 5, and 6 (2014). 4270 Miss. Code Ann. § 97-37-25 (2014). 4271 Mont. Code Ann. § 571.030 (2014). See also, Miss. Code Ann. § 97-37-25 (2014) (explosives and weapons of mass destruction; unlawful use); § 97-25-41 (2014) (railroads; wilfully shooting from or on moving train); and § 97-25-47 (2014) (railroad trains, buses, trucks, motor vehicles, depots, stations, and other transportation facilities; wilfully shooting or throwing at).
821 10. Montana Montana prohibits âknowingly... [d]ischarg[ing] or shoot[ing] a firearm into ... a railroad train....â4272 11. New York In New York, â[a]ny person who wilfully discharges a loaded firearm or any other gun, the propelling force of which is gunpowder ... at any railway or street railroad train ... or at a locomotive, car, bus or vehicle standing or moving upon such railway, railroad or public highway, is guilty of a [felony].â4273 12. Oklahoma In Oklahoma âany person shall be guilty of a felony if the person discharges a firearm or weapon at a train, or rail-mounted work equipment.â4274 13. Pennsylvania Pennsylvania prohibits entering âany railroad train, locomotive, tender or car thereof, or into or upon any automobile or other conveyance used for the carrying of freight or passengersâ while carrying nitroglycerine or other explosive.4275 14. South Carolina South Carolina prohibits an unauthorized individual from placing explosives on railroad rails.4276 Another South Carolina statute bans railroads from transporting firearms across state lines.4277 4272 Mont. Code Ann. § 571.030 1(3) (2014). 4273 N.Y. Penal Law § 265.35 (2014). 4274 Okla. Stat. Ann. 21 § 1752.1(B) (2014). 4275 18 Pa. Cons. Stat. § 6161 (2014).
822 15. South Dakota South Dakota prohibits entering a train with any type of weapon intending to commit a crime.4278 16. Texas In Texas it is a Class B misdemeanor if a person throws an object or discharges a firearm or weapon at a train or rail-mounted work equipment âunless the person causes bodily injury to another, in which event the offense is a felony of the third degree.â4279 17. Utah In Utah, a â[a] person may not discharge any kind of dangerous weapon or firearm ⦠at railroad equipment or facilities including any sign or signalâ¦.4280 18. Virginia As provided in the Code of Virginia, it is a class 4 felony for â[a]ny person who maliciously shoots at, or maliciously throws any missile at or against[] any train or cars on any railroad or other transportation company â¦. whereby the life of any person on such train ⦠may be put in perilâ¦.â It is murder in the second degree if the shooting results in the death of a person but murder in the first degree when the death was âwillful, deliberate and 4276 S. C. Code Ann. § 58-15-830 (2014). 4277 S.C. Code § 16-23-220 (2014). 4278 S. D. Codified Laws § 49-16A-105 (2014). 4279 Tex. Penal Code Ann. §§ 28.07(b)(1) and (c) (2014). 4280 Utah Code Ann. § 76-10-508(1)(a)(v) (2014).
823 premeditatedâ¦.â When such an âact is committed unlawfully, but not maliciously, the person so offending is guilty of a Class 6 felony and, in the event of the death of any such person, resulting from such unlawful act, the person so offending is guilty of involuntary manslaughter.â4281 19. Washington A Washington statute applies to malicious injury to railroad property: Every person who, in such manner as might, if not discovered, endanger the safety of any engine, motor, car or train, or any person thereon, shall in any manner interfere or tamper with or obstruct any switch, frog, rail, roadbed, sleeper, viaduct, bridge, trestle, culvert, embankment, structure, or appliance pertaining to or connected with any railway, or any train, engine, motor, or car on such railway, and every person who shall discharge any firearm or throw any dangerous missile at any train, engine, motor, or car on any railway, is guilty of a class B felony and shall be punished by imprisonment in a state correctional facility for not more than ten years.4282 20. West Virginia It is a felony in West Virginia to âwillfully damage[] or attempt[] to damage railroad property or willfully endanger[] or attempt[] to endanger the safety of another, by ... [s]hooting a firearm or other dangerous weapon at a locomotive, railroad car or train....â4283 Cases E. Denial of Benefits to a former Railroad Employee Fired for Carrying a Firearm In Brotherhoodâs Relief & Comp. Fund v. Rafferty4284 a former employee sued a local workerâs group for denying him a stipend after he had been fired for having a firearm at his job 4281 Va. Code Ann. § 18.2-154 (2014). 4282 Wash. Rev. Code § 81.60.070 (2014). 4283 W. Va. Code §§ 61-3-28(b)(3)-(5) (2014).
824 on the railroad.4285 The Fund denied benefits to him because he was terminated for a willful violation of a railroadâs policy on firearms.4286 An Alabama appellate court stated that the Fund had not acted arbitrarily when it made its decision and reversed the lower court for substituting its judgment for that of the Fund.4287 F. Railroad not Liable when an Employeeâs Gun Injuries another Employee In Cluck v. Union Pac. R. Co.4288 a railroad employee was shot accidentally by a fellow employee when the latter had packed a pistol in his luggage. The pistol discharged as Cluck was unloading luggage from a van for the railroad crew during the employeesâ hours of employment.4289 The court ruled that the employeeâs proposed jury instructions failed to instruct the jury on whether the injury-causing conduct was done in furtherance of the interests of the employerâs business.4290 The Supreme Court of Missouri stated that the employee could not impute liability under FELA to the railroad because the jury was unable to determine whether âthe carrying of the pistol in his luggage ... was done in furtherance of the interests of the employerâs business,â a key element to the doctrine of respondeat superior.4291 The petitioner 4284 91 So.3d 693 (Ala. App. 2011), rehâg denied, 2011 Ala. Civ. App. LEXIS 384 (Dec. 9, 2011), cert. denied, No. 1110372 (Apr. 6, 2012). 4285 Id. at 695. 4286 Id. at 694. 4287 Id. at 698. 4288 367 S.W.3d 25 (Mo. 2012), rehâg denied (July 3, 2012), cert. denied, 133 S. Ct. 932, 184 L. Ed.2d 724 (2013). 4289 Id. at 28. 4290 Id. at 27. 4291 Id.
825 argued that the doctrine of respondeat superior did not apply in FELA actions and that he only needed to show that Clark (the pistol owner) was acting on behalf of the employer at the time of the shooting.4292 The court, however, disagreed: To submit an imputed negligence claim under FELA, Petitioner was obligated to make a submissive case that he and Clark were acting within the cause and scope of their employment, that is, that Clarkâs negligent conduct was undertaken in furtherance of the interests of the employer.4293 The court held there was no reversible error and affirmed the judgment in favor of Union Pacific.4294 4292 Id. at 28-29. 4293 Id. at 32. 4294Id. at 34.
