Operator of Delaware port settles Norfolk Southern lawsuit

Jul 12, 2022, 9:56 AM | Updated: 10:39 am

DOVER, Del. (AP) — The private company that operates Delaware’s state-owned marine port has settled a lawsuit filed by Norfolk Southern Railway Co. over unpaid rail car storage bills.

Attorneys notified a federal judge in a court filing Monday that they have resolved the dispute, and that an undisclosed settlement amount should be paid in full by October.

Norfolk Southern filed the lawsuit in March 2021, asserting that it was owed more than $300,000 by GT USA Wilmington under agreements governing the delivery of rail cars to the Port of Wilmington.

The lawsuit alleged, among other things, that GT USA Wilmington failed to return rail cars to Norfolk Southern within the allotted “free time” before storage charges began to accumulate, then failed to pay the resulting invoices.

Norfolk Southern also claimed that GT USA Wilmington failed to pay costs resulting from the port operator’s request to switch rail cars around at the terminal, and failed to clear certain rail cars of packing material and debris.

GT USA Wilmington asserted that it was not contractually liable to Norfolk Southern for any of the charges referenced in the lawsuit and filed its own third-party complaint against Chiquita Fresh North America LLC.

GT USA Wilmington argued that it received rail shipments of paper rolls from Chiquita but was not a party to the rail transportation agreement between Chiquita and Norfolk Southern, and that Chiquita owed the rail car storage charges. GT USA Wilmington voluntarily dismissed the third-party complaint against Chiquita less than three weeks after filing it.

The lawsuit is one of several legal disputes in which GT USA Wilmington has become enmeshed since signing a privatization deal with Democratic Gov. John Carney’s administration in 2018.

GT USA Wilmington is a subsidiary of port management company Gulftainer, which is based in the United Arab Emirates. It obtained the rights to operate the Wilmington port for 50 years in exchange for agreeing to make significant upgrades and to pay the state at least $3 million annually in concession fees based on cargo volume moving through the port.

Earlier this year, a Delaware Chancery Court judge ruled that GT USA Wilmington was not entitled to charge terminal usage fees to the operator of a petroleum offloading operation at the port and could not block the operator or its customers from accessing an adjacent fuel storage terminal.

The ruling came almost two years after the judge issued a preliminary injunction prohibiting GT USA Wilmington from preventing access to storage tanks owned by Buckeye Partners that hold gasoline and diesel fuel for distribution to gas stations and convenience stores throughout the mid-Atlantic region.

Last year, a different Chancery Court judge ruled against GT USA Wilmington in a dispute over a planned buyout of the port’s former stevedoring firm. The judge said GT USA Wilmington was bound by the terms of a 2018 letter agreement regarding the purchase and sale of 100% of the equity interest of Murphy Marine Services.

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Operator of Delaware port settles Norfolk Southern lawsuit