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Railroad ICCTA Preemption Argument Rejected

Emerson v. Kansas City Southern Ry. Co., 503 F.3d 1126 (C.A. 10, Sept. 24, 2007)

The Revocable Trust of Charley L. Davis and the Revocable Trust of Annie O. Davis (“Landowners”) owned property abutting a floodplain drainage ditch containing a culvert. This ditch was adjacent to a railroad track belonging to Kansas City Southern Railroad Company (“Railroad”). Landowners claimed that the railroad routinely discarded railroad ties and cut vegetation into this ditch, interfering with the flow of water through the culvert, and ultimately flooding their property. Landowners brought a state tort lawsuit against the railroad alleging trespass, unjust enrichment, public and private nuisance, negligence, and negligence per se.

The Railroad removed the case to District Court (E.D. Okla.) and moved for summary judgment based on the Interstate Commerce Commission Termination Act of 1995 (ICCTA) which, it argued, both expressly and impliedly preempted Landowners' state law tort claims. 49 U.S.C.A. §10101 et seq. The District Court agreed and granted the Railroad’s motion. Landowners appealed.

The Court of Appeals first examined the Railroad’s express preemption claim. The ICCTA contains an express preemption clause that reads: “[e]xcept as otherwise provided in this part, the remedies provided under this part with respect to regulation of rail transportation are exclusive and preempt the remedies provided under Federal or State law.” 49 U.S.C. §10501(b). The Court of Appeals determined that putting debris into a ditch and the failure to otherwise properly maintain that ditch fell outside of the ICCTA definition of “transportation.” Thus, the express preemption clause did not cover the state law claims brought by Landowners.

The Court of Appeals next considered the Railroad’s claim that the ICCTA impliedly preempted the state tort claims through conflict preemption. Conflict preemption would be found if it were impossible for the Railroad to comply with both the ICCTA and requirements that would be imposed on it by Oklahoma state tort law if Landowners were to prevail. The Court reviewed a variety of precedent and ultimately adopted the rule that “states retain local police powers related to the health and safety of their citizens provided it does not interfere with interstate railroad operations.” In order for the motion for summary judgment to prevail on this point, the Railroad had the burden of showing that any and all potential remedial measures would impermissibly “interfere with interstate railroad operations.” The Court of Appeals held that the Railroad had failed to satisfy that burden.

Finding neither type of preemption applicable, the Court of Appeals reversed the Distrct Court grant of Summary Judgment to the Railroad.



Judge(s): McConnell
Jurisdiction: U.S. Court of Appeals, Tenth Circuit
Plaintiff Lawyer(s) Plaintiff Law Firm(s)
Dale Williams Jr Hall Estill Hardwick Gable Golden & Nelson PC

Defendant Lawyer(s) Defendant Law Firm(s)
C. Ryan Norton Hardin Jesson & Terry PLC
Rex Terry Hardin Jesson & Terry PLC
W. G. Steidley, Jr. Steidley & Neal PLLC



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of sediment in the drainage ditch and in the flooding of the landowners' property 49 u.s.c. §§ 10501(b), 10701­10747, 11101­11124)[.] court accepted this argument and granted summary judgment in the railroad's therefore, while we agree that maintenance is an integral part of running a in sum, based on the statute's plain language and the stb's interpretation interrogatory also stated that they would like to see the drainway resculpted "to on a regular basis. appellant's app. 47. there is nothing in the record to suggest that the landowners had any engineering or other expertise that would qualify [iccta], the transportation board is uniquely qualified to determine whether this case involves claims of both express and conflict preemption. see iccta, the stb held: "remain fully applicable unless specifically displaced." id. we conclude that no not expressly preempt the plaintiffs' tort claims. we also conclude that there iccta preempts the state tort claims brought by the plaintiffs, who own land either of these categories. state tort law obviously has no pre-approval gave to an interrogatory requesting that they "describe in detail the actions [they] provides no clear indication of what actions by the railroad could have prevented secretary, a state or local government could issue citations or seek example, even in cases where we approve a construction or landowners claim that the improperly discarded railroad ties and vegetation 982, 987 (10th cir. 2000) (same). l.p., 443 f.3d 1240, 1243 (10th cir. 2006)) (brackets omitted). though the courts in friberg and auburn concluded that the state laws in september 24, 2007 -13- larry emerson; rail regulation--not state and federal law generally. for example, regulated by the board--such as the construction, operation, and clarifying that the exclusivity is limited to remedies with respect to obstacle to the accomplishment and execution of the full purposes and objectives wanted the railroad to stop throwing its used ties into the drainage ditch; and that unanimously to grant the parties' request for a decision on the briefs without oral defense upon which the defendants bear the burden of proof."). (d.c. no. 05-cv-331-kew) under the iccta "does not completely remove any ability of state or local original). united states court of appeals 49 u.s.c. §§ 11321­11328); and railroad rates and service (see does directly relate to the operation of [railroad's] track and would adversely summary judgment, arguing that the landowners' state law claims were pre-empt all state and federal law that might touch on a railroad's property or the local community. we know of no court or agency ruling that operations, as well as the construction and operation of the kcs side tracks, is implicate the type of economic regulation congress was attempting to prescribe failed to cut the vegetation in the drainage ditch on a regular basis, and that when reasonable exercise of local police power. similarly, as noted by the clause, our `task of statutory construction must in the first instance focus on the in a separate order, the stb gave examples of permissible state regulation: 792. whatever its form, pre-emption analysis "starts with the assumption that the the iccta [that] explicitly grant the stb exclusive authority over railway 2001), the fifth circuit held that the iccta preempted a negligence suit against a railway company, (b) services related to that movement, including receipt, power. it held that if "local authorities have the ability to impose `environmental' ability to conduct some part of its operations or to proceed with activities that the board has authorized. remedies adversely affect the economic aspects of the railroad's operations i. congress gave "extensive authority in this area," city of lincoln v. surface in one of its latest decisions addressing the preemptive scope of the protection of the public health and safety, and other generally disposal of maintenance byproducts is necessarily preempted. and although it is economic regulation or deregulation. such laws are general state laws that not deny the railroad the ability to operate or to proceed with an stb-approved b. conflict preemption would lead to absurd results. if the iccta preempts a claim stemming from because they do not generally collide with the scheme of economic under § 10102(9), the iccta does not expressly preempt the generally applicable r.r. co.­stampede pass line, 2 s.t.b. 330, 1997 wl 362017, at *6 (july 1, general electric co. 496 u.s. 72, 78-79 (1990). the second is implied conflict (surface transp. bd. may 3, 2005) (citations and footnote omitted) (denying application of the oklahoma tort laws at issue here, a factual assessment must be home builders co., 222 f.3d 788, 791 (10th cir. 2000). because of the when it enacted the iccta." id. the latter holding is closely analogous to our h.r. rep. no. 104-422, at 167 (1995), reprinted in 1995 u.s.c.c.a.n. 850, 852. ordered submitted without oral argument. judgment of the district court.1 this reading is consistent with other interpretations of the iccta's development of railroad property, at least to the extent that the -18- extortion, remain fully applicable unless specifically displaced, general rule [of increased exclusivity for federal remedies], while effect,'" cipollone v. liggett group, inc., 505 u.s. 504, 516 (1992) (quoting impact upon [railroad's] economic activities." id. at 128. while certainly expansive, this definition of "transportation" does not actions to be preempted regardless of the context or rationale for the dispose of a dilapidated engine in the middle of main street--a cheap way to be plaintiffs'] property." id. at 501. the iccta did not preempt those claims to prevent further flooding. unreasonably interfering with railroad transportation, the record as it exists company (railroad), the defendant below, argued to the district court that the component, as it necessarily addresses wrongs that have already occurred; and if exclusively." sprietsma v. mercury marine, 537 u.s. 51, 64 (2002), quoting within the local authorities' jurisdiction under the constitution. for green mountain r.r., 404 f.3d at 643 (internal quotation marks omitted). it davis and the revocable trust of annie o. davis (landowners). their property second, there can be no state or local regulation of matters directly should be installed to allow the unimpeded flow of surface storm water through regulations protect public health and safety, are settled and defined, no. 06-7081 rid of an unwanted rail car. after all, in this hypothetical, as in this case, the exercise of discretion on subjective questions. electrical, plumbing may preempt state common law as well as state statutory law through federal made as to whether requiring the railroad to remedy the injury claimed by the clerk of court pre-emption, which occurs when "it is `impossible for a private party to comply interpretation of the statutes it administers unless its statutory construction is classifications, rules (including car service, interchange, (2) the construction, acquisition, operation, abandonment, or drainage ditch adjacent to the tracks and otherwise failing to maintain that ditch. before lucero, circuit judge, brorby, senior circuit judge, and landowners would have the effect of preventing or unreasonably interfering with board, the agency congress created in the iccta, id. § 10102(1), and to which claims for negligence and nuisance based on the railroad's construction of an them to provide an expert opinion on the precise steps that would need to be taken and fire codes, direct environmental regulations enacted for the railroads' allegedly tortious actions. the courts also found that the states' earthen berm, which "was constructed to reflect and absorb noise emissions to the contrary notwithstanding." u.s. const. art. vi. see choate v. champion of congress.'" sprietsma, 537 u.s. at 64, quoting freightliner, 514 u.s. at 287, moreover, the railroad's argument has no obvious limit, and if adopted local regulation is permissible where it does not interfere with interstate rail it cut the vegetation, it disposed of the debris in the right-of-way. the vermont, 404 f.3d 638, 642 (2d cir. 2005) (internal quotation marks omitted); see near their store, and the increase in train crossings led to a decrease in customers. preventing or unreasonably interfering with railroad transportation." csx legal standard employed by the district court." king v. pa consulting group, (1) transportation by rail carriers, and the remedies 1997) (emphasis added). -7- at 792. mcconnell, circuit judge. dispose of detritus or maintain drainage ditch vegetation. nor would the state for the eastern district of oklahoma railroad is merely disposing of unneeded railroad equipment in a cost-conscious landowners' response was that "additional culverts or a railroad bridge/trestle of the state tort laws at issue would "stand[] as an obstacle to the accomplishment concerning use; and iccta impliedly preempts the plaintiffs' claims. we therefore reverse the state common law governing the railroad's disposal of waste and maintenance of plain wording of the clause, which necessarily contains the best evidence of interprets the iccta's preemption clause such that this absurd result is avoided. manner in which the defendant conducts its switching activities." id. the court negligence claims brought to quell noise and vibrations emanating from the [t]here are areas with respect to railroad activity that are reasonably example, in rushing v. kansas city southern railway co., 194 f. supp. 2d 493 track. the ditch itself contains a culvert system. the landowners allege that ordinance involving the dumping of waste could be fined or penalized provided in this part with respect to rates, and under defendant's railroad." id. the district court held that: -9- fed. r. civ. p. 56(c). when applying this standard, "`we view the evidence and satisfy its burden of production. see fifth third bank ex rel. trust officer v. csx detritus, or maintenance of vegetation, collides with the federal scheme of `does not bar the ordinary working of conflict pre-emption principles.'") (quoting -6- the court held that it was "beyond peradventure that regulation of kcs train rushing, however, also held that the iccta did not preempt plaintiffs' l. davis; revocable trust of enjoin the [railroad] from operating its switch yard in the manner it currently actions. for example, one house report states: stephanie emerson, operations, and localities retain certain police powers to protect public health and kansas city southern -2- party opposing summary judgment, as we must, the landowners' response to the plaintiffs state that the manner in which they expect defendant to enhance both flow and detention characteristics of the drainway"; that they transp. bd., 414 f.3d 858, 861 (8th cir. 2005). the stb has exclusive are exclusive and preempt the remedies provided under federal or state law." possible that some potential remedies would have the effect of preventing or publish state law should be preempted by the [iccta]." green mountain r.r. corp. v. originating from the rail yard" and resulted in "the pooling of rainwater on [the supremacy of federal law, "state law that conflicts with federal law is `without congress has the power to pre-empt state law under article vi of the remanded to the district court for further proceedings. mergers, line acquisitions, and other forms of consolidation (see expressly preempted by § 10501(b). iii. were insufficient facts in the record for the district court to determine whether the also r.r. ventures, inc. v. surface transp. bd., 299 f.3d 523, 548 (6th cir. 2002) applicable, non-discriminatory regulations and permit requirements tracks, or facilities, even if the tracks are located, or intended construction or upgrading project. a railroad that violated a local federal pre-emption of state law may be either express or implied. choate, interrogatory answer. interpreting the evidence in the light most favorable to the be a railroad company. because these acts or omissions are not "transportation" as discussed above, congress's purpose in passing the iccta was to elisabeth a. shumaker tenth circuit delivery, elevation, transfer in transit, refrigeration, icing, the judgment of the district court is reversed, and the case is inc., 485 f.3d 577, 585 (10th cir. 2007). summary judgment is appropriate "if non-preemption. these courts looked to the iccta's plain language and found a applying that test, we conclude that the district court erred by granting supreme law of the land; . . . any thing in the constitution or laws of any state rectify the drainage deficiencies along the track is to install circuit courts have agreed with the stb on this point. the second circuit -10- subjecting the railroad to state law would not cause this case to fall into "requires a factual assessment of whether that action would have the effect of -14- construction of a trestle and culverts beneath the track which [landowners] seek plaintiffs-appellants, ramifications." id. 49 u.s.c. §§ 10101-16106). the district court agreed. it held that "the facts are not preempted. after examining the briefs and appellate record, this panel has determined1 while not necessary to our conclusion, our holding is confirmed by the rather, they are possibly tortious acts committed by a landowner who happens to adjacent to their properties. this, in turn, allegedly resulted in a gradual build-up permitting regulations on the railroad, such power will in fact amount to commission termination act of 1995 (iccta). kansas city southern railway railroad in oklahoma state court, alleging state torts of trespass, unjust [t]he courts have found two broad categories of state and local judgment in favor of the railroad. (a) a locomotive, car, vehicle, vessel, warehouse, wharf, pier, we conclude, however, that the district court read too much into this "transportation" as: likewise, in city of auburn v. united states, 154 f.3d 1025, 1028, dock, yard, property, facility, instrumentality, or equipment of has held that "not all state and local regulations are preempted [by the iccta]; in the affected area-matters which are expressly reserved to the old railroad ties or its maintenance of vegetation along its right-of-way. 49 u.s.c. § 10501(b). "as the agency authorized by congress to administer the instrumentalities "related to the movement of passengers or property," and the district court's order was grounded on an answer that the landowners -16- "we review the grant of summary judgment de novo, applying the same comes in two varieties. the first is field pre-emption, which occurs when "the 222 f.3d at 792. express pre-emption occurs when congress "define[s] explicitly iv. draw all reasonable inferences therefrom in the light most favorable to the party for dumping by the state or local entity. the railroad also could be operating, abandoning, or discontinuing a line." id. at 1031. drainage problems resulting from the construction of the berm would not this case concerns the preemptive scope of the interstate commerce improperly dumped railroad ties, it is not a stretch to say that the railroad could remedy the situation. the district court therefore erred in granting summary we do not think that a generally applicable state law regulating the disposal of because "the design/construction of the berm does not directly relate to the states. id. at 500­01. business failed because the railroad began more frequently using its side track regulations would have an adverse economic effect on aspects of the railroads' safety." maumee & w. r.r. corp. and rmw ventures, llc--petition for defendant-appellee. transp., inc. v. easterwood, 507 u.s. 658, 664 (1993)). the act defines historic police powers of the states are not to be superseded by . . . federal act adjacent to the railroad's track in sequoyah county, oklahoma. the district specifically listed in the iccta. the court also noted that "[r]egulating the time these acts (or failures to act) are not instrumentalities "of any kind related to the its 1976 depth and configuration [to] restore the original design volume and id. at 127. the district court reasoned that this interrogatory answer was criminal statutes governing antitrust matters not pre-empted by this operations that are within the stb's exclusive jurisdiction. here, in contrast, no regulation (and deregulation) of rail transportation. opposing summary judgment.'" reinhart v. lincoln county, 482 f.3d 1225, 1229 -15- iccta provision gives the stb authority to dictate how the railroad should w.g. "gil" steidley, jr., steidley & neal, p.l.l.c. (c. ryan norton, rex m. for plaintiffs-appellants. permitting precondition to re-establishing a certain railroad spur as a main route. question were preempted, their reasoning supports our conclusion of interfere with, interstate commerce. therefore, such requirements the extent to which its enactments pre-empt state law." id. implied preemption terry, hardin, jesson & terry, plc, with him on the brief), for mcconnell, circuit judge. discarded the used rails in the drainage ditch. they also allege that the railroad iccta did not preempt a state negligence action--because "[w]ithout doubt, the [s]tates and towns may exercise traditional police powers over the of the statutory text, and consistent with the legislative history and precedent subsection (b) on "services related to that movement." we do not think that the constitution, which provides that "the laws of the united states shall be the plaintiffs' state law claim [were] not in dispute." appellant's app. 124. the geier v. american honda motor co., 529 u.s. 861, 869 (2000)) (emphasis in the plaintiff landowners in this case are the revocable trust of charley l. own. jurisdiction over: employs"--authority the iccta plainly and exclusively gives to the stb, not the congress' pre-emptive intent.'" sprietsma, 537 u.s. at 62­63 (quoting csx revocable trust of charley activity. further, the stb does not directly regulate the railroad's disposal of its preempted by the iccta, pub. l. no. 104-88, 109 stat. 803 (codified at tenth circuit landowners complain of here--discarding old railroad ties into a wastewater dumping excavated earth into local waterways would appear to be a summary judgment because the railroad did not present sufficient evidence to sufficient to distinguish this case from rushing's second holding--that the such a requirement would constitute an unreasonable burden on, or preemptive scope. we look, for instance, to rulings by the surface transportation and other operating rules), practices, routes, services, iccta's legislative history, which shows that congress did not intend to ventilation, storage, handling, and interchange of passengers unless that is the clear and manifest purpose of congress. accordingly, the cities of auburn & kent, wa--petition for declaratory order--burlington n. when the railroad replaced old, deteriorated wooden railroad ties, it regularly v. the pleadings, depositions, answers to interrogatories, and admissions on file, ("[t]his court must give considerable weight and due deference to the [stb's] and property[.] the ditch. 2005) ("under the supremacy clause of the united states constitution, congress corp., 415 f.3d 741, 745 (7th cir. 2005) ("federal preemption is an affirmative favor. after reviewing the record, however, we conclude that the iccta does freightliner corp. v. myrick, 514 u.s. 280, 287 (1995), quoting english v. under the exclusive jurisdiction of the stb," id. at 443, because those items were construction in a way that did not harm the health or well being of 49 u.s.c. § 10501(b). because the iccta "contains an express pre-emption and facilities of such carriers; and argument. see fed. r. app. p. 34(f); 10th cir. r. 34.1(g). the case is therefore which [were] necessary to evaluate whether federal preemption applies to plaintiffs, enrichment, public and private nuisance, negligence, and negligence per se. they regulation requiring a railroad to conduct a local environmental review as a plainly unreasonable.") (second brackets in original; internal quotation marks statutory law, see rivera v. philip morris, inc., 395 f.3d 1142, 1146 (9th cir. both, by rail, regardless of ownership or an agreement the court found support for its holding in "the plain language of two sections of csx transp., inc.­petition for declaratory order, 2005 wl 1024490, at *2-*4 diversity jurisdiction. see 28 u.s.c. § 1441(b). it then filed a motion for appeal from the united states district court debris impeded the flow of water through the drainage ditch and culvert system -8- the stb has held that to decide whether a state regulation is preempted with both state and federal requirements,' or where state law `stands as an for railroad transportation. but the stb has recognized that federal preemption damages if harmful substances were discharged during a railroad omitted). -11- -5- remedies provided under this part with respect to regulation of rail transportation abandonment project, a local law prohibiting the railroad from id. abatement and remediation, and other relief. the landowners' answer to the establish an exclusive federal scheme of economic regulation and deregulation maryland v. louisiana, 451 u.s. 725, 746 (1981)), be it state common law or landowners now appeal. we have jurisdiction under 28 u.s.c. § 1291. the railroad removed the case to federal court, invoking the court's to be located, entirely in one state[.] railroad to comply with both federal and oklahoma law, or whether application a. express preemption plain language of this statute can be read to include the conduct that the and execution of the full purposes and objectives of congress." choate, 222 f.3d any kind related to the movement of passengers or property, or railroad by owners of a defunct business. the plaintiffs' theory was that their (s.d. miss. 2001), the court held that the iccta preempted state nuisance and together with the affidavits, if any, show that there is no genuine issue as to any projects" like the one in that case. id. at 1030. it also disregarded the state's movement of passengers or property" or "services related to that movement." id. also found "that an order . . . directing the [railroad] to compensate and correct railroad transportation. fashion. our holding, which is consistent with the iccta's legislative purpose, action. the first is any form of state or local permitting or -12- `economic regulation' if the carrier is prevented from constructing, acquiring, contend[ed] need[ed] to be performed n (sic) order to remedy the flooding legislation."); see also dist. 22 united mine workers of am. v. utah, 229 f.3d "additional culverts or a railroad bridge/trestle." clearly, any such omitted). quoting hines v. davidowitz, 312 u.s. 52, 67 (1951). see choate, 222 f.3d at -3- the landowners prevail on remand, the applicable remedy under state law would annie o. davis, can be obeyed with reasonable certainty, entail no extended or the conference provision [of 49 u.s.c. § 10501(b)] retains this 1030­31 (9th cir. 1998), the ninth circuit held that the iccta preempted state statutory provision that expressly granted the stb authority to govern the purpose of congress is the ultimate touchstone of pre-emption analysis." we next consider conflict preemption: whether it is impossible for the defendant-appellee. railroad, we do not agree that any state or local regulation of such maintenance or obtain. the landowners' petition asked for actual and punitive damages, a train can occupy a rail crossing impacts, in such areas as train speed, length and material fact and that the moving party is entitled to judgment as a matter of law." sought actual and punitive damages, abatement, remediation, and other relief. we therefore hold that in order to decide whether § 10501(b) impliedly preempts (10th cir. 2007) (quoting terra venture, inc. v. jdn real estate-overland park, abandonment of rail lines (see 49 u.s.c. §§ 10901­10907); railroad measures bear directly upon the "practices," "operation," and -17- on a number of occasions. these incidents led the landowners to sue the united states court of appeals d. kenyon williams, jr., hall, estill, hardwick, gable, golden & nelson, p.c., cipollone, 505 u.s. at 516 (internal quotation marks, citations, and brackets the previous flooding and what would be required of the railroad at this time to such displacement has occurred here. continued: problems described in the pleadings." appellant's app. 47. part of the and see griffin v. oceanic contractors, inc., 458 u.s. 564, 575 (1982). interrogatory was nothing more than a wish for a remedy that they would like to -4- exclusive jurisdiction of the stb. sprietsma, 537 u.s. at 65 ("congress' inclusion of an express pre-emption clause ii. scope of a statute indicates that congress intended federal law to occupy a field transp., inc., 2005 wl 1024490, at *3. we agree with this standard and adopt it. attempt to justify its permitting requirements as a valid exercise of state police the iccta states that "[e]xcept as otherwise provided in this part, the local bodies retain certain police powers which protect public health and safety." encompass everything touching on railroads. subsection (a) focuses on physical authorities to take action that affects railroad property. to the contrary, state and declaratory order, 2004 wl 395835, at *1 (surface transp. bd. mar. 2, 2004). from other courts, we hold that the state tort remedies at issue in this case are not they wanted dead trees, vegetation, and debris removed from the drainage ditch scheduling, the way a railroad operates its trains, with concomitant economic "construction" in regard to defendant's "facilities," namely the track in friberg v. kansas city southern railway co., 267 f.3d 439 (5th cir. id. § 10102(9)(a)­(b). filed act, and laws defining such criminal offenses as bribery and open-ended delays, and can be approved (or rejected) without the in addition, our holding finds support in the precedents of other courts. for preclearance that, by its nature, could be used to deny a railroad the discontinuance of spur, industrial, team, switching, or side petitions for reconsideration and reopening). railroad's switching yard. those causes of action, the court reasoned, sought "to abuts a floodplain drainage ditch that is adjacent to a portion of the railroad's subject to stb control. would seem to withstand preemption. required to bear the cost of disposing of the waste from the

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