Posts Tagged ‘U.S. Supreme Court’

Supreme Court Says RRB Decisions Reviewable by Courts

February 5, 2021

The U.S. Supreme Court has ruled that a decision of the U.S. Railroad Retirement Board is subjective to judicial review.

The 5-4 decision by the high court overturned an earlier ruling by the U.S. Court of Appeals for the Fifth Circuit.

The appeals court had determined that it lacked jurisdiction because the Railroad Retirement Act outlines a series of steps to appeal a retirement board decision.

Among those are an appeal to the retirement board itself.

However, the Supreme Court said the Railroad Unemployment Insurance Act allows judicial review of retirement board decisions.

The case involved a Union Pacific worker who had had three requests for disability benefits rejected by the retirement board.

Although a fourth quest for the benefits was granted, the worker went to court to challenge the amount and start date of his benefits.

Supreme Court Won’t Take On-Time Case

February 28, 2018

The U.S. Supreme Court has rejected a request by Amtrak to review a lower court decision that found the Surface Transportation Board cannot assume regulatory authority that is granted to Congress.

The high court’s decision means that a last effort by the federal government to revive the delegated authority will be decided by the U.S. District Court for the District of Columbia.

In a July 2017 decision, the Eighth Circuit Court of Appeals decided that the STB lacked the authority to establish regulatory standards for “on-time performance” in exercising its power to require freight railroads to give “preference” to Amtrak trains. See, Union Pacific Railroad Co. v. Surface Transportation Board, 863 F.3d 816 (8th Cir. 2017).

The Union Pacific case was one of two in which courts considered challenges to a portion of the Passenger Rail Investment and Improvement Act of 2008.

That law delegated to the Federal Railroad Administration and Amtrak the joint power to establish metrics and standards to define “on-time performance,” and gave the STB power to penalize railroads that fail to meet the standards.

The other case was Association of American Railroads vs. U.S. Department of Transportation.

In the latter case, the railroad trade organization challenged the joint FRA/Amtrak authority as an unconstitutional delegation of governmental power to Amtrak because it is a for profit entity.

The appellate court in that case sided with the AAR, ruling that the law constituted a violation of the Fifth Amendment’s due process clause to give Amtrak, “an economically self-interested actor,” the power to regulate its competitors.

Following that decision, the STB sought to establish the on-time standards itself, which led to the Union Pacific case.

The district court in Washington has set oral arguments for March 5 in what remains of the AAR case.

During that hearing, the federal government and Amtrak will be seeking to have the court reinstate the joint rule-making authority of the FRA and Amtrak by narrowing the court’s previous decision and striking down only a portion of the offending PRIIA provision.

Appeals Court Strikes Down STB On-Time Standards

July 18, 2017

Another federal court has struck a blow to the efforts of the U.S. Surface Transportation Board to establish on-time standards for Amtrak trains.

The Eighth U.S. Circuit Court of Appeals found the STB standards to be unconstitutional, saying that the STB had “exceeded its authority” in creating the standards.

The appeals court ruling came in the wake of a similar U.S. Supreme Court decision that development of on-time metrics by the Federal Railroad Administration and Amtrak as directed by Section 207 of 2008’s Passenger Rail Investment and Improvement Act was unconstitutional.

In the Eighth Circuit ruling, Chief Judge Lavenski R. Smith acknowledged that the absence of on-time standards would make it impossible for the STB to investigate or adjudicate disputes brought by Amtrak against its host railroads in the event that punctuality fell below 80 percent for two consecutive quarters.

However, the court in essence decided that the STB’s inability to measure on-time performance is not a problem for the judiciary to solve.

There are two cases pending before the STB in which Amtrak alleges that host railroads needlessly delayed Amtrak trains.

One case involves the handling by Canadian National of the Saluki and Illini between Chicago and Carbondale, Illinois, while the other regards Norfolk Southern’s handling of the Capitol Limited west of Pittsburgh.

In both cases, Amtrak contends that dispatching decisions made by the host railroads are delaying its trains.

The STB had contended that it had the legal right to establish on-time standards “by virtue of its authority to adjudicate complaints brought by Amtrak. Any other result would gut the remedial scheme, a result Congress clearly did not intend.”

Supporting the STB’s position were 13 intervenors, including the National Association of Railroad Passengers and its state affiliates, and the U.S. Conference of Mayors.

Challenging the on-time standards were Union Pacific, CSX, CN and the Association of American Railroads.

They argued that the “gap-filling rationale does not allow one agency to assume the authority expressly delegated to another.”

The court found that the only place in federal law where the 80 percent standard was spelled out was in section 207, which the Supreme Court ruled unconstitutional because Amtrak had a hand in developing it.

Although the court let stand Congress’ setting a statutory right of passenger train “priority” over freight trains, the practical effect of the court decision is that Amtrak has no way to challenge a host railroad’s systematic denial of that right.

Instead, the only motivation for railroads to keep Amtrak trains on time are the proprietary and confidential incentive contracts Amtrak has been able to negotiate with its host railroads pertaining to on-time handling.

The only action Amtrak can take against a host railroad would be to refuse to make incentive payments due to non-performance under the terms of its operating contract with a host railroad.

The court rulings do suggest that Congress could give the FRA a mandate to establish on-time standards provided that Amtrak was not a participant in the writing of those standards.

Appeals Court Sides With AAR in Amtrak Case

May 3, 2016

A federal appeals court ruled last week that a 2008 law unconstitutionally gave Amtrak regulatory power over its contract railroads.

The U.S. Court of Appeals for the District of Columbia sided with the Association of American Railroads in saying that the Passenger Rail Investment and Improvement Act of 2008 gave Amtrak too much power when it comes to writing regulations pertaining to on-time performance metrics.

It was the second time that the appeals court has ruled in favor of the AAR.

Amtrak logoAn earlier decision was overturned by the U.S. Supreme Court which sent the case back to the appeals court for further review.

AAR had brought suit against the U.S. Department of Transportation in an effort to invalidate Section 207 of the 2008 PRII law.

In its latest ruling, the appeals court said the law’s giving Amtrak the authority to write regulations that affect its host railroads is in violation of the Constitution’s Due Process clause.

The court also knocked down the clause that gives the Surface Transportation Board the authority to appoint a mediator to arbitrate disputes between Amtrak and a host railroad over on-time performance.

The case has a long history that began with a federal district court siding with the U.S. DOT in favor of the law.

AAR appealed that decision to the appeals court, which said in July 2013 that Amtrak is a private company.

The Supreme Court ruled unanimously in March 2015 that Amtrak must be considered a governmental entity but instructed the appeals court to decide the question of the propriety of a government entity that is a participant in a private marketplace being able to regulate that marketplace.

However, concurring opinions by justices Samuel Alito and Clarence Thomas noted that the situation might violate a host railroad’s right to due process.

Those opinions said that regulators must be “disinterested” government bodies rather than competitors in the business.

In its latest ruling, the appeals court cited the Alito and Thomas’s opinions, but conceded that Amtrak and its contract railroads are not competing for the same customers.

They are, however, the court said, competing for the same scarce railroad route capacity and therefore must be considered economic competitors.

As for the STB’s authority under the 2008 law to appoint an arbitrator, the appeals court said that an independent arbitrator appointed by the STB cannot make final regulations because he or she is not a duly appointed or sworn Officer of the United States, as the Constitution requires.

The AAR originally filed suit acted after the U.S. DOT began to promulgate regulations under Section 207 if the PRII with the railroad trade group arguing that the law was an unconstitutional delegation of rule-making to a private company.

In briefs to the court, the AAR relied on the congressional proclamation of the Rail Passenger Service Act of 1970 creating the National Railroad Passenger Corporation (Amtrak) not be treated as a government entity but instead be operated as a for-profit business.

Although the appeals court last week struck down Section 207, it left the rest of the 2008 PRII intact and did not disturb Amtrak’s statutory rights to access of freight railroad tracks on an incremental cost basis.

Nor did the appeals court set aside laws that give Amtrak trains “preference over freight transportation.”

Congress could revise the 2008 law to grant the U.S. DOT the sole power to write on-time performance metrics and standards, in consultation with Amtrak and other others.

In doing so, Congress could give the authority to mediate between Amtrak and a contract railroad to the STB, whose members are duly sworn Officers of the United States, appointed by the president with the advice and consent of the Senate.

The court did not say that it was improper for the federal government to promulgate on-time performance regulations.

U.S. Supreme Court Sides With Amtrak in Dispute

March 10, 2015

The U.S. Supreme Court has sided with Amtrak in a dispute with its host railroads over on-time standards.

The court unanimously found that Amtrak is a government entity and it directed the U.S. District Court for the District of Columbia to reconsider the case in light of the high court’s ruling.

That court had ruled in a case brought by the Association of American Railroads that Amtrak was a private company and therefore could not participate in setting standards with the FRA in the Passenger Rail Investment and Improvement Act of 2008’s Section 207, which sets measurable thresholds of on-time performance, because one private entity (Amtrak), would be regulating others (host railroads).

The district court had also expressed reservations about the constitutionality of Amtrak’s structure.

Writing for the Supreme Court, Justice Anthony Kennedy cited a 1995 Supreme Court case in which Amtrak had tried to argue it was private, but lost.

In the AAR case, Kennedy wrote, “The political branches created Amtrak, control its Board, define its mission, specify many of its day-to-day operations, have imposed transparency and accountability mechanisms, and for all practical purposes set and supervise its annual budget.”

Kennedy also said the District Court will still need to deal with the issue of whether the delegation of powers to Amtrak violates the Due Process or Appointments clauses of the Constitution.

Justices Clarence Thomas and Samuel Alito Jr., wrote separate concurring opinions in which each expressed reservations about Amtrak’s structure.

Alito argued that Section 207’s arbitration provision “is fair game for challenge,” because if a private arbitrator were chosen to decide a dispute over metrics between the FRA and Amtrak (which didn’t happen), that person would be “making law without supervision” and that would be illegal.

Alito also said that since Amtrak’s president is appointed by the board of directors but not the President of the United States, “it does not necessarily follow that the present structure of Amtrak is consistent with the Constitution.”