BLOG

The Board Opens a Rulemaking Proceeding to Consider a Petition by Three Class I Railroads to Modernize Annual Revenue Adequacy Determinations

On December 30, 2020, the Surface Transportation Board (the Board or STB) issued a decision initiating a rulemaking proceeding to consider a joint petition by several Class I railroads, Union Pacific Railroad Company (UP), Norfolk Southern Railway Company (NS), and the U.S. rail operating affiliates of Canadian National Railway Company (collectively, CN), to change the Board’s procedures for annually determining whether Class I rail carriers are revenue adequate under 49 U.S.C. § 10704(a)(3).  Joint Petition for Rulemaking—Annual Revenue Adequacy Determinations, Ex Parte 766 (STB served Dec. 30, 2020). 

Read More

The Board Declines to Issue a Declaratory Order, But Offers Guidance, Regarding Preemption of Certain Provisions of the Clean Water Act

The Surface Transportation Board (the Board or STB) issued a decision on December 30, 2020, denying a request by the Association of American Railroads (AAR) for a declaratory order regarding preemption of the Clean Water Act’s (CWA) National Pollutant Discharge Elimination System (NPDES) permitting program and discharge prohibition.  Ass’n of Am. R.R.—Pet. for Declaratory Order, FD 36369 (STB served Dec. 30, 2020).

Read More

The Board Preliminarily Concludes that the Transportation Aspects of the Proposed Construction and Operation of a Rail Line in Utah Meet the Statutory Exemption Standard

On January 5, 2021, the Surface Transportation Board (STB or Board) issued a decision addressing the transportation merits of the proposed construction and operation of an approximately 85-mile rail line in Utah.  Seven County Infrastructure Coalition—Construction and Operation—in Utah, Carbon, Duchesne, and Uintah Counties, UT,FD 36284 (STB served Jan. 5, 2021) (with Board Member Oberman dissenting).  The Board preliminarily concluded, subject to completion of the ongoing environmental review, that the transportation aspects of the proposed project meet the statutory exemption standard under 49 U.S.C. § 10502.  Id., slip op. at 1.

Read More

CDC Issues Framework For Conditional Sailing Order For Cruise Ships

The once vibrant U.S. cruise industry has been sharply impacted by the COVID-19 pandemic.   On March 14, 2020, in response to the pandemic, the Centers for Disease Control and Prevention (“CDC”) issued a No Sail Order effective for 30 days precluding cruise ship operations arriving or departing from U.S. ports.1  The CDC Director entered the No Sail Order to mitigate the threat of severe illness and death from COVID-19. The No Sail Order was renewed by the CDC on April 9, 2020, July 16, 2020, and September 30, 2020.2  Over the past eleven months, cruise ship operations were brought to a standstill.

Read More

Grappling with Deregulation and Shared Facilities

Last summer, the long-running In re: Rail Freight Fuel Surcharge Antitrust Litigation 1 case took a detour through a rarely cited section of the Staggers Rail Act of 1980 (“Staggers”)2 that excludes certain communications and agreements between competing rail lines from evidence in antitrust cases. In response to the parties’ briefing on the scope of the statute, the Court requested the Department of Justice’s views on the statute. Though the DOJ’s guidance was specifically focused on the statute at issue, the advice it contained is relevant for competitors in any industry that have legitimate reasons in certain contexts to communicate with competitors or agree on prices with competitors, even as they otherwise compete on prices with them in the market. In the Rail Freight Fuel Surcharge litigation, the legitimate communications involve interline pricing between rail carriers shipping freight across multiple rail networks. In other industries, for example, it can involve a vertically-integrated company providing logistical or back-office services to a customer-facing competitor with which they compete for retail customers, or other dual distribution circumstances.

Read More

President Joseph Biden, Jr. Has Designated Martin J. Oberman As Chairman of The Surface Transportation Board

President Joseph Biden, Jr. has designated Martin J. Oberman as Chairman of the Surface Transportation Board.  Chairman Oberman issued the following statement praising the outgoing chairman, Commissioner Begeman:

Read More

Motor Carriers and California - No Clear Preemption Road Ahead

Federally licensed motor carriers that operate trucking companies in the Ports of Los Angeles and Long Beach, two of the largest ports in the United States, often contract with owner-operator truck drivers to perform drayage, or the short distance movement of cargo. Since these trucking companies often classify the owner-operator truck drivers as independent contractors, when doing so they do not pay unemployment insurance taxes, employment training fund taxes, or disability insurance taxes. For purposes of this article, it is assumed that such trucking companies do not provide workers’ compensation or reimbursement for business expenses, such as fuel, truck insurance, parking, and routine maintenance costs.

Read More

ATLP Highlights – Hazmat

In a year like no other, 2020 saw the advancement of numerous pipeline safety initiatives at the Pipeline and Hazardous Materials Safety Administration (PHMSA).  In early 2020, PHMSA issued a Final Rule adopting safety standards applicable to underground natural gas storage facilities, which was required by the PIPES Act of 2016.  Among other things, the Final Rule requires operators to apply integrity and risk management principles to storage facilities, narrows certain reporting requirements, and clarifies compliance with respect to non-mandatory industry practices.  In 2020, PHMSA also published four major Notices of Proposed Rulemaking (NPRM): Liquid Pipeline Regulatory Reform, which would modify the agency’s enforcement and regulatory procedures, regulations governing facility response plans for oil pipelines, and safety regulations applicable to hazardous liquid pipelines; Gas Pipeline Regulatory Reform, which would modify a number of reporting and safety regulations applicable to gas pipelines; Requirements for Valves and Rupture Identification and Mitigation, which proposes new requirements to install remote-control valves, automatic shutoff valves, or equivalent technology on newly-constructed or entirely-replaced onshore gas transmission and certain hazardous liquid pipelines, and would impose new rupture and mitigation standards; and Class Location Requirements, which would permit an alternative approach to managing the safety of certain gas transmission pipelines whose class locations change from Class 1 to Class 3.  The comment deadline has closed for each proposed rule.  

Read More

2020: Year in Review?

I titled this column with a question mark because one might legitimately ask whether anyone is interested in reviewing a year we would rather all forget. Clearly this was a year most of us would rather not dwell on, a year in which we stopped being physically close to family and friends, traveling, eating out, going to the theater or otherwise living our normal nonwork and work live as we knew them. But the show goes on and, like it or not, there were some developments in 2020 transportation law world that are worth looking back on, even if the year as a whole was much less than rosy.

Starting with Congress, this past year offers an illustration of Congress at its best and its worst. The most important legislation to emerge as a result of COVID-19 in 2020 was the Coronavirus Aid, Relief and Economic Security Act, otherwise known as the CARES Act, a huge measure which was impressively put together quickly and enacted before the end of the first month of the full-fledged pandemic in this country, on March 27, 2020. The $2.2 trillion Act not only helped sustain the economy generally, but helped keep certain passenger transportation sectors afloat. Airlines, airports, public rail and bus transit agencies, and Amtrak received billions in aid, allowing them to keep their operations going and their payrolls significantly intact even while the general public was being told not to engage in any non-essential travel. The other side of the story is that Congress so far has failed to follow up with more needed aid in the latter part of this year as CARES Act funding dries up together with the willingness of partisans to compromise. As I write this, however, it appears that another relief measure may finally be coming together as a result of the efforts of Congress’s bi-partisan Problem Solvers Caucus. It appears that this next relief measure will provide assistance to the passenger transportation sector and perhaps prevent the privately-owned bus industry, left out of CARES, with some much needed aid.

Read More

U.S. District Court Holds that the Montreal Convention Does not Provide a Basis for Personal Jurisdiction

The U.S. District Court for the District of New Jersey recently held that although the Montreal Convention confers subject matter jurisdiction over a plaintiff’s suit arising from injuries sustained while disembarking a flight to and from destinations abroad, it does not confer personal jurisdiction over the defendant airline absent an injury arising from the carrier’s activities specifically directed at the state in which suit was brought.[1]

Read More

Senate Confirms Two New STB Commissioners

On November 18, 2020, the Senate confirmed Michelle Schultz and Robert Primus to five-year terms to the Surface Transportation Board. 

Ms. Schultz was first nominated in 2018, her seat is a new position following the expansion of the Board from three to five members.  Ms. Schultz has been a Deputy General Counsel with the Southeastern Pennsylvania Transit Authority (SEPTA) since 2006.  In addition to her JD, Ms. Schultz holds a Master’s Degree in Government Administration from the University of Pennsylvania.

Read More

FMCSA Requests Public Comments on Broker Transparency Petitions

The Federal Motor Carrier Safety Administration (“FMCSA”) requested public comments on petitions for rulemaking backed by owner-operator/small-fleet groups to address the transparency of broker rates. The notice is in response to petitions filed by the Owner-Operator Independent Drivers Association (“OOIDA”) and the Small Business in Transportation Coalition (“SBTC,” and, together with OOIDA, the “Petitioners”). 

49 C.F.R. 371.3(a) requires brokers to maintain detailed records of their brokered transactions, including the amount of compensation received by the broker for the brokerage service performed and the name of the payer, and the amount of any freight charges collected by the broker and the date of payment to the carrier. 49 C.F.R. 371.3(c) gives each party to a brokered transaction the right to review the record of the transaction required to be kept. 

Read More

The Board Seeks Public Comment on New Approach for Considering Class Exemption and Revocation Issues

The Federal Motor Carrier Safety Administration (“FMCSA”) requested public comments on petitions for rulemaking backed by owner-operator/small-fleet groups to address the transparency of broker rates. The notice is in response to petitions filed by the Owner-Operator Independent Drivers Association (“OOIDA”) and the Small Business in Transportation Coalition (“SBTC,” and, together with OOIDA, the “Petitioners”).   

Read More

UP, NS & CN File Joint Petition for Rulemaking to Modernize Annual Revenue Adequacy Determinations

On September 1, 2020, Petitioners Union Pacific Railroad Company (UP), Norfolk Southern Railway Company (NS), and the U.S. rail operating affiliates of Canadian National Railway Company (collectively, CN) filed a joint petition urging the Surface Transportation Board (STB or Board) to initiate a rulemaking proceeding to adopt rules that would revise and modernize annual revenue adequacy determinations under 49 U.S.C. § 10704(a).  Joint Petition for Rulemaking to Modernize Annual Revenue Adequacy Determinations, Ex Parte 766 (filed Sept. 1, 2020).

Petitioners stated that Congress charged the Board with annually measuring the financial health of the rail industry and assisting each railroad in achieving revenue adequacy, and the Board has committed itself to “evidence-based decision-making,” using tools that were designed three decades ago.  Id., slip op. at 1.  According to Petitioners, the Board currently relies on accounting measures of return on investment (ROI), rather than the current economic value of those investment assets, then removes billions of dollars of accumulated deferred taxes from that investment base, which adds yet another distortion, and analyzes these findings without considering evidence about typical rates of return for the companies with which railroads compete for capital.  Id., slip op. at 1-2.

Read More

Five Class I Railroads File Joint Petition for Rulemaking to Establish an Alternative Voluntary Arbitration Program for Small Rate Disputes

On July 31, 2020, five Class I railroads, Canadian National Railway Company (CN), CSX Transportation, Inc. (CSX), Norfolk Southern Corporation (NS), Union Pacific Railroad Company (UP), and the Kansas City Southern Railway Company (KCS) (collectively, Petitioners), submitted a joint petition requesting that the Surface Transportation Board (STB or Board) initiate a rulemaking proceeding to establish a new voluntary arbitration program for small rate disputes.  Joint Petition for Rulemaking to Establish an Alternative Voluntary Arbitration Program for Small Rate Disputes, Ex Parte 765 (filed July 31, 2020).

Petitioners stated that Congress had instructed the Board to develop “simplified and expedited methods for determining the reasonableness of challenged rates in those cases in which a full stand-alone cost presentation is too costly, given the value of the case.”  Id., slip op. at 1.  Over the last thirty years, “the Board has responded by creating multiple new simplified, and increasingly less precise, rate review methodologies.”  Id.  However, some stakeholders in the shipping community have continued to complain that the Board’s implied methodologies are insufficient in regard to flexibility, cost, and speed.  Id.

Read More

IMO Guidelines On Maritime Cyber Risk Management

The International Maritime Organization (“IMO”) acknowledges that the increasing prevalence of cyberattacks on ships constitutes an inherent risk to the safety of vessels, crewmembers,  passengers, cargo, and the marine environment.  Both the IMO Maritime Safety Committee and Facilitation Committee have focused their attention on the urgent need to raise awareness of the need to (1)  identify vulnerable systems, and (2) create procedures to thwart and recover from malicious cyberattacks.  

Read More

The ATLP Transportation Forum XVII Webinar Series Starts Next Thursday REGISTER NOW

The ATLP Transportation Forum XVII webinar series starts next Thursday, November 5 at 2 pm EST and runs every Thursday at 2:00 pm EST except for Thanksgiving and Friday, Dec. 4th. Over the years, this one-day event has been hosted by the Surface Transportation Board in Washington, DC. This year, you can participate from the comfort of, what is now, your “favorite chair!”



This year’s Forum program will include:



Read More

DOT Publishes Guidance on Revised Federal Drug Testing Custody and Control Form

The U.S. Department of Transportation (DOT) requires drug and alcohol testing for personnel performing safety-sensitive functions in the transportation industry, such as truck drivers holding a Commercial Driver’s License who operate a truck that requires a hazardous materials placard (49 C.F.R. Part 382) and operators of natural gas and other hazardous liquids pipelines (49 C.F.R. Part 199).

Read More

PHMSA Commits Over $100 Million to Improving Pipeline and Hazardous Materials Safety

On October 5, 2020, the DOT’s Pipeline and Hazardous Materials Safety Administration (PHMSA) announced an award package totaling $7,810,213 to fund 10 pipeline safety research and development (R&D) projects. The projects will support pipeline safety priorities including Damage/Threat Prevention, Leak Detection, Anomaly Detection/Characterization, Liquefied Natural Gas (LNG), and Improved Materials. The projects were selected by the Merit Review Panel, which consists of 28 members from PHMSA, the Federal Energy Regulatory Commission, and members of the pipeline and LNG industry.

Read More

A LABOR FOCUSED FUTURE

This promises to be a time of quickly accelerating changes in labor relations, catalyzed in part by remote work in the context of Covid-19 and, parallel to that, the potential for new structures for labor relations if a new Congress advances the re-writing of traditional labor relations envisioned in the so-called “PRO” Act, amending the National Labor Relations Act, the Labor Management Relations Act, 1947, and the Labor-Management Reporting and Disclosure Act of 1959, inter alia. The latter matters because we may see reversals of decade long entrenched employer protections in those statutes, a novel penalty scheme, and, for the first time, private rights of action.

Read More