Court: Some rail rate talks allowed in price-fixing suits

May 18, 2022, 12:05 PM | Updated: 2:45 pm
FILE - A CSX freight train pulls through McKeesport, Pa., on June 2, 2020.  A federal judge has rul...

FILE - A CSX freight train pulls through McKeesport, Pa., on June 2, 2020. A federal judge has ruled that the details of conversations between the nation’s four largest railroads should be included in lawsuits challenging billions of dollars of charges the railroads imposed in the past. (AP Photo/Gene J. Puskar, File)

(AP Photo/Gene J. Puskar, File)

OMAHA, Neb. (AP) — A federal appeals court has ruled that details of some of the conversations between the nation’s four largest railroads about their rates can now be included in lawsuits challenging billions of dollars they charged their customers, but the mixed ruling will also exclude some documents.

The ruling from the District of Columbia Circuit Court of Appeals this week will likely set up more arguments over evidence as Union Pacific, BNSF, Norfolk Southern and CSX railroads defend themselves against dozens of lawsuits accusing them of conspiring to inflate their rates with coordinated fuel surcharges between 2003 and 2007.

The key to determining what evidence is admissible will be whether the conversations relate to shipments that cross multiple railroads or not. The court noted that federal law does allow railroads to coordinate about shared shipments, but said it “defies logic” to exclude discussions about traffic that stays on a single railroad or conversations about all shipments.

These price-fixing allegations have been creeping through the courts since 2007. The cases used to be part of a class-action lawsuit including as many as 16,000 shippers in a variety of industries, but companies were forced to file their own lawsuits after an appellate court rejected that group approach in 2019.

One of the plaintiffs’ attorneys, Stephen Neuwirth, said the ruling should help the major companies that filed lawsuits — including food producer Campbell Soup, major utility Dominion Energy and carmaker Hyundai — show that the railroads talked about applying fuel surcharges to all traffic to generate profits.

“The court’s ruling will help ensure that a jury can see the evidence of defendants’ collusion, and that railroads are not effectively immune from the antitrust laws,” Neuwirth said.

But railroads praised the ruling Wednesday because it said conversations about the shipments they share can be excluded from the lawsuits.

“We are grateful to the D.C. Circuit Court of Appeals for recognizing the intent of Congress to prevent normal interline communications from being used to infer unlawful conspiracy,” Union Pacific spokeswoman Robynn Tysver said in a statement.

CSX spokeswoman Cindy Schild the ruling recognizes the importance of lawful collaboration when railroads work together to deliver freight.

“This fuel surcharge litigation against the U.S. based Class 1 railroads has been ongoing for over 15 years,” Schild said. “CSX has and will continue to defend against the unfounded claims of anti-trust violation as its fuel surcharge practices were arrived at and applied lawfully.”

The two other major freight railroads didn’t immediately comment on the ruling. In the lawsuits, they have argued their fuel surcharges were legal and simply intended to recover the skyrocketing cost of fuel at the time they were imposed. Similar charges are common in the transportation industry.

The law that lets freight railroads work together to handle shipments they hand off to each other as they cross the country is part of the decisions Congress made when they deregulated railroads in 1980. Even though federal law encourages competition among railroads, they are allowed to coordinate about the shipments they share to ensure the continuity of the nation’s rail network.

The four major railroads handle the majority of the millions of shipments that cross the country each year with Omaha, Nebraska-based Union Pacific and Fort Worth, Texas-based BNSF operating in the Western United States while Jacksonville, Florida-based CSX and Atlanta-based Norfolk Southern compete for freight in the East.

Copyright © The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.


              FILE - An American flag is emblazoned on this Union Pacific Railroad locomotive sitting in the Jackson, Miss., terminal rail yard, Wednesday, April 20, 2022.  A federal judge has ruled that the details of conversations between the nation’s four largest railroads should be included in lawsuits challenging billions of dollars of charges the railroads imposed in the past. (AP Photo/Rogelio V. Solis File)
            
              FILE - A CSX freight train pulls through McKeesport, Pa., on June 2, 2020.  A federal judge has ruled that the details of conversations between the nation’s four largest railroads should be included in lawsuits challenging billions of dollars of charges the railroads imposed in the past. (AP Photo/Gene J. Puskar, File)

AP

(Facebook Photo/City of San Luis, Arizona)...
Associated Press

San Luis authorities receive complaints about 911 calls going across border

Authorities in San Luis say they are receiving more complaints about 911 calls mistakenly going across the border.
6 days ago
(Pexels Photo)...
Associated Press

Daylight saving time begins in most of US this weekend

No time change is observed in Hawaii, most of Arizona, Puerto Rico, the U.S. Virgin Islands, American Samoa, Guam and the Northern Marianas.
14 days ago
Mexican army soldiers prepare a search mission for four U.S. citizens kidnapped by gunmen in Matamo...
Associated Press

How the 4 abducted Americans in Mexico were located

The anonymous tip that led Mexican authorities to a remote shack where four abducted Americans were held described armed men and blindfolds.
14 days ago
Tom Brundy points to a newly built irrigation canal on one of the fields at his farm Tuesday, Feb. ...
Associated Press

Southwest farmers reluctant to idle farmland to save water

There is a growing sense that fallowing will have to be part of the solution to the increasingly desperate drought in the West.
21 days ago
A young bison calf stands in a pond with its herd at Bull Hollow, Okla., on Sept. 27, 2022. The cal...
Associated Press

US aims to restore bison herds to Native American lands after near extinction

U.S. officials will work to restore more large bison herds to Native American lands under a Friday order from Interior Secretary Deb Haaland.
21 days ago
Children play in a dried riverbed in Flassans-sur-Issole, southern France, Wednesday, March 1, 2023...
Associated Press

Italy, France confront 2nd year of western Europe drought

ROME (AP) — Bracing for Italy’s second consecutive year of drought for the first time in decades, Premier Giorgia Meloni huddled with ministers Wednesday to start mapping out an action plan Wednesday, joining France and other nations in western Europe grappling with scant winter rain and snow. Meloni and her ministers decided to appoint an […]
23 days ago

Sponsored Articles

(Desert Institute for Spine Care in Arizona Photo)...
Desert Institute for Spine Care in Arizona

5 common causes for chronic neck pain

Neck pain can debilitate one’s daily routine, yet 80% of people experience it in their lives and 20%-50% deal with it annually.
...
Day & Night Air Conditioning, Heating and Plumbing

Company looking for oldest air conditioner and wants to reward homeowner with new one

Does your air conditioner make weird noises or a burning smell when it starts? If so, you may be due for an AC unit replacement.
...
Quantum Fiber

How high-speed fiber internet edges out cable for everyday use

In a world where technology drives so much of our daily lives, a lack of high-speed internet can be a major issue.
Court: Some rail rate talks allowed in price-fixing suits