A proposed high-speed passenger railroad between Dallas and Houston has successfully convinced the federal Surface Transportation Board (STB) that it has jurisdiction over the proposed Texas rail line. While STB jurisdiction will greatly aid the rail line by generally preempting state and local regulation, the STB's order has added federal requirements that will have to be addressed. FD 36025 (STB Served July 16, 2020)

Texas Central Railroad and Infrastructure Inc. and its subsidiary, Texas Central Railroad LLC (Texas Central), had lost an initial effort to secure federal jurisdiction over its planned line of railroad in 2016. That's when the STB found that Texas Central's operation, as then presented, would be purely in intrastate commerce. With this most recent decision, the STB rules that Texas Central's new plans will make it part of the "interstate rail network" and place it squarely in the realm of interstate commerce and the STB's exclusive jurisdiction.

In June, a United States District Court for the District of Columbia, held that it lacked subject matter jurisdiction to review the Department of Transportation (“DOT”) and  Maritime Administration’s (“MARAD”) decision that the citizenship of a vessel satisfied the requirements of 46 U.S.C. § 50501.  In Matson Navigation Co, Inc. v U.S. Department of Transportation et. al—F. Supp. 3d—(D.C. 2020), the court ruled that the Court of Appeals had exclusive jurisdiction pursuant to the Hobbs Act, 28 U.S.C. § 2342, to review MARAD’s 2015 decision that a commercial vessel satisfied the citizenship requirements to enroll in the Maritime Security Program, 46 U.S.C. §§ 53101 – 53111.

On July 8, the United States Court of Appeals for the Ninth Circuit issued a decision affirming a district court ruling in favor of BNSF Railway Company (BNSF) regarding the railroad’s challenge to Oregon’s tax on intangible personal property as a discriminatory tax on railroads in violation of the Railroad Revitalization and Regulatory Reform Act (4-R Act).  BNSF Ry. Co. v. Or. Dep’t of Revenue, 965 F.3d 681 (9th Cir. 2020).

The Board adopted a final rule establishing a streamlined approach for pleading market dominance in rate reasonableness proceedings.  Market Dominance Streamlined Approach, Ex Parte 756 (STB served Aug. 3, 2020).  This decision finalized a notice of proposed rulemaking (NPRM) served in this proceeding on September 12, 2019.  The Board received comments from over 20 entities on the NPRM.  As explained below, the Board in the final rule adopted the NPRM proposals with minor modifications.

On June 23, the Board withdrew its proposal to revise its methodology for calculating the cost-of-equity component of the railroad industry’s cost of capital by incorporating a third model, based on comments and replies the Board received in response to the notice of proposed rulemaking (NPRM).  Revisions to the Board’s Methodology for Determining the R.R. Indus.’s Cost of Capital, Ex Parte 664 (Sub-No. 4) (STB served June 23, 2020). 

In our March 6, 2020 hazardous materials Highlight post, we shared the US Department of Transportation - Office of Inspector General’s (“DOT-OIG”) website, www.oig.dot.gov, which provides up-to-date information on recent hazmat transportation civil and criminal enforcement actions.  Practitioners can stay informed of these developments in real-time by signing up for the DOT-OIG’s email notification list. Below are two recent enforcement actions that caught our attention.

Introduction

            Recent news in the passenger rail transportation regulatory realm includes the following:

Dear Members,

I am grateful to have the opportunity to serve you as ATLP’s president for 2020-2021. I thank Tim Wackerbarth for his service to our organization as past president, including his leadership through the COVID-19 pandemic.

I owe this opportunity to the young professionals program. Started about eight years ago, the program was a sustainability effort that sought to engage and attract young professionals. It worked! Approximately half of our current officers participated in the program.

This edition of Highlights will focus on impending shifts in traditional labor law arising from the CARES Act, National Labor Relations Board decision trends and retrenchment of policy directions from those taken under the Obama Board. Thomas Lenz, a partner and former NLRB attorney contributed the section on procedural updates. Robert Fried may be reached at: [email protected], 925-251-8515 (direct) or 925-998-0742 (cell).

Quorum Confirmed

On July 29, 2020 the Senate confirmed appointments of current Board Member Marvin Kaplan (Republican) and past Board Member Lauren McFerran (Democrat).  Employers should expect that the Board panel’s continuing quorum will enable further action on pending cases and policy initiatives to alter the private sector labor relations landscape.

This week’s transportation conversation is with Beth Osborne.  Beth is a lawyer by training; She has dedicated her career to transportation public policy in Congress, the U.S. DOT, and now with Smart Growth America’s transportation program, Transportation for America.

At DOT, Beth served as the Acting Assistant Secretary for Transportation Policy and the Deputy Assistant Secretary for Transportation Policy from 2009 to 2014. In that capacity, Beth managed the Transportation Investment Generating Economic Recovery (TIGER) Discretionary Grant program now known as the BUILD program, the Secretary’s livability initiative, the development of the Administration’s surface transportation authorization proposal, and the implementation of MAP-21.

Thank you for allowing me to serve as your President for the 2019-2020 year.  Needless to say, it was an eventful year and not exactly what we anticipated.  We were very much looking forward to the annual meeting in Vancouver, BC.  I think we showed flexibility when the COVID 19 health crisis and corresponding travel and gathering restrictions made an in-person annual meeting unworkable.  I want to thank the Board for their hard work and support during this time.  Thanks also to our Program Chairs, Louis Amato-Gauci and Jameson Rice, who put together an impressive array of topics and speakers for the annual meeting which we were able to present to the membership in a series of online webinars.  This enabled us to realize a substantial percentage of our budgeted revenue for the meeting which was enhanced by the savings of meeting expenses in Vancouver.  It is my hope that the Association will be able to resume in-person meetings soon, maybe as early as the Transportation Forum this fall.  It is also my hope that the Association will be able to hold the meeting in Vancouver at some point in the future as it is a spectacular venue.

The U.S. District Court for the Northern District of Georgia recently dismissed to Germany a plaintiff’s Montreal Convention suit against Delta Airlines and KLM on grounds of forum non conveniens.¹ The plaintiff in this action purchased a ticket for travel in Germany through Delta’s website. His roundtrip travel was to Atlanta, and then to Amsterdam and finally Munich, Germany. The flight from Atlanta to Amsterdam was operated by a joint venture of Delta on KLM. On that flight, a beverage cart hit plaintiff’s knee, causing him injury. He brought suit against Delta and KLM in the U.S. District Court for the Northern District of Georgia. Both Delta and KLM brought motions to dismiss arguing that the case should be heard in Germany rather than the U.S. on the grounds of forum non conveniens, which readers will recall is a doctrine that allows defendants to dismiss cases to alternative forums on grounds that the plaintiff’s chosen forum is too inconvenient given the location of the parties, the evidence and other factors set forth below.

This week’s ATLP Highlights blog features an interview with Jenifer Ross-Amato, Deputy General Counsel – until this past June, Interim General Counsel – of Denver’s Regional Transportation District (RTD).  RTD is a political subdivision of the State of Colorado and the Denver metropolitan area’s transit agency with over 170 bus routes and 11 light and commuter rail lines.

My discussion with Jenifer is a sequel of sorts to my May 22 conversation with SEPTA Deputy General Counsel, Jay Fox.  In contrast to SEPTA’s legacy rail operations, RTD light and commuter rail services are a “New Start” named after the Federal Transit Agency’s program for funding new commuter services.  

Congratulations to two of our ATLP Board members who have been listed on Law360's Rising Stars for 2020 Top Attorneys Under 40.

Recent reports indicate that a number of new entities are organizing and raising capital to respond to opportunities arising from the COVID-19 crisis and related developments. Recently, Beacon, a United Kingdom-based forwarding startup that "aims to act as the booking agents between importers and exporters while facilitating trade logistics and finance" according to its website, has signed on a $15 million investment from Jeff Bezos. Beacon investors already include top executives from Uber, Google and other companies in the surrounding supply chain, transport and logistics space.

There are also a significant number of other new and well-capitalized players in the forwarding and third-party logistics (3PL) business, offering innovative services to match suppliers and buyers, and to move goods in global commerce more quickly and easily, with more pricing options for traders at all levels. Many of these services offer to move almost anything, from personal items to trade goods, from one place to another globally at very competitive prices, with simple transaction structures and simple on-line booking.

The Clause Paramount and Himalaya Clause in Two Through Bills of Lading Extend COGSA Limitations to the Ocean Carrier and Inland Rail Carriers

            Recently, in Siemens Energy, Inc. and Progressive Rail, Inc. v. CSX Transp., Inc., __ F. Supp. 3d __ (E.D. Ky. 2020), a district court held that the through bills of lading for an international shipment extended the limitation of liability provisions of the Carriage of Goods by Sea Act (COGSA), 46 U.S.C. § 30701, Note § 1(a), to the rail carrier for the inland leg of the transportation of cargo.  The district court further held that the Covenant Not to Sue contained in the through bills of lading prohibited the Shipper from asserting a claim for cargo damage against the inland rail carrier.

This blog discusses three recent decisions issued by the Surface Transportation Board (STB or Board) in two demurrage proceedings that arose, in part, as a result of testimony and comments submitted in Ex Parte 754, Oversight Hearing on Demurrage & Accessorial Charges.

The Board Issues a Demurrage Policy Statement

            On April 30, 2020, the Board issued a Statement of Board Policy explaining the principles the Board will consider in evaluating the reasonableness of demurrage and accessorial rules and charges.  Policy Statement on Demurrage and Accessorial Rules and Charges, EP 757 (STB served April 30, 2020).  This policy statement was finalized following a notice of proposed statement of Board policy issued in October 2019 and a public comment period.  The Board noted that it is not making any “binding determinations” with the policy statement, and that the Board will continue to adjudicate specific cases based on all facts and arguments presented.  Id., slip op. at 3.

Introduction
 
            The passenger rail sphere has seen a number of developments in the spring of 2020 on the regulatory and funding fronts, including:

The Federal Motor Carrier Safety Administration (FMCSA) has issued its long-awaited final rule on changes to hours of service requirements in a move intended to increase flexibility for truck drivers and motor carriers. The final rule is based on a proposed rulemaking that was announced August 14, 2019. The final rule was published on June 1, 2020 and will go into effect on September 29, 2020. The final rule includes four key revisions to the existing hours of service requirements:

Robert is a partner with AALRR and a member of the firm’s Return to Work Task Force. He is a co-author of the AALRR Return to Work Tool Kit

Many of the waking hours of executives in the modes and their counsel have been filled with navigating the emergency rules and regulations that have been issued at the federal and state level arising from the Covid-19 Pandemic.

The new legal framework for remote work, economic benefits and relief, social distancing, testing and matters of testing and personal protective hygiene, returning to work poses challenges.  However, returning to normalcy brings its own irony for employers - a return to issues of traditional labor law, albeit in new ways. That is our topic here.