Wednesday, June 16, 2010

Commuter Rail Division v. STB

Jun 15: In the U.S. Court of Appeals, D.C. Circuit, Case No. 08-1346. Canadian Pacific Railway Corporation (CPR), along with its indirect subsidiary Soo Line Holding Company (Soo Holding), and Dakota, Minnesota & Eastern Railroad Corporation (DME), along with its subsidiary Iowa, Chicago & Eastern Railroad Corporation (ICE), (collectively Applicants) applied to the Surface Transportation Board (STB or Board) for approval of a merger in which Soo Holding (and indirectly CPR) was to acquire DME and ICE. They filed the application under 49 U.S.C. § 11324, which authorizes the Board to initiate a proceeding to approve various transactions within its jurisdiction, including the acquisition of one or more railroads by another railroad.

    The STB approved the acquisition. Metra, which operates two rail lines that are potentially affected by CPR's acquisition, and the Sierra Club seek review of the STB's decision approving the acquisition. Metra challenges the Board's refusal to attach "conditions" to the approval, in order to protect Metra's rights over its track line running north from Chicago toward Wisconsin over which Soo Holding has trackage rights and for which CPR is the dispatcher. Sierra Club challenges the Board's decision to defer preparation of an environmental impact study (EIS) until CPR decides whether to move forward with the construction of a line connecting DME's track in South Dakota to certain coal mines located in Wyoming's Powder River Basin (PRB).
    The Appeals Court dismissed Sierra Club's petition for lack of constitutional standing and denied Metra's petition because "the Board's approval of the merger was not an abuse of its discretion." On the Sierra Club challenge, the Appeals Court concludes: "Because Sierra Club has not shown, as it must, 'a causal connection between the government action that supposedly required the disregarded procedure' -- here, approval of the DME acquisition -- 'and some reasonably increased risk of injury to its particularized interest,' we dismiss its petition for lack of standing." The Appeals Court cites Fla. Audubon Soc'y v. Bentsen, 94 F.3d 658, 664 (D.C. Cir. 1996) (en banc).
    Access the complete opinion (click here).

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