In the News

“Shippers Blast Rail Cos. Bid for Appeal on Evidence Issue,” Law360

March 23, 2021

The country’s biggest rail giants can’t put long-running antitrust multidistrict litigation on hold while they appeal a D.C. federal court’s decision not to allow them to nix evidence that would give them “de facto” immunity, the shippers bringing the suit argue.

“This case is a teenager, almost ready to move out,” the shippers told the court Friday in a 42-page brief laying out their case for why U.S. District Judge Paul L. Friedman should deny the bid for an interlocutory appeal. “[T]he case is nearly ready for trial. Certification would grind this progress to a halt and add a year or more of delay.”

After 14 years of fighting over claims that the railway companies conspired to fix fuel surcharge prices, the shippers who rely on the railway giants and form the direct purchaser classes say that it’s time for the litigation to draw to a close.

At the heart of the interlocutory appeal issue is Judge Friedman’s ruling that the rail giants, Union Pacific Railroad Co., CSX Transportation Inc., Norfolk Southern Railway Co. and BNSF Railway Co., can’t use Section 10706 of the U.S. Code to keep a swath of evidence from being used against them in the upcoming trial.

Section 10706 includes a transportation mandate that keeps certain government-approved rate-setting agreements between rail carriers from being used as evidence against them in an antitrust case.

The rail companies believe it applied here, but Judge Friedman ultimately disagreed.

The court said that the mandate was much more narrow than what the companies were arguing and can’t be used to nix evidence of communications that only touch on interline shipping, such as discussing rate changes for “interline and single-line traffic” or requests from one carrier to another about “general rate increases unrelated to any particular shipments.”

Judge Friedman ended up issuing a ruling that was very much in line with what the U.S. Department of Justice told the court when it offered its two cents on the issue: that Section 10706 only provides protection in a narrow set of circumstances.

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The plaintiffs are represented by Hausfeld LLP, Quinn Emanuel Urquhart & Sullivan LLP, Vinson & Elkins LLP, Thompson Hine LLP, Slover & Loftus LLP, Cohen Milstein Sellers & Toll PLLC, Boies Schiller Flexner LLP, German May PC, Nexsen Pruet LLC, Debevoise & Plimpton LLP, Sperling & Slater PC, Weil Gotshal & Manges LLP, Eimer Stahl LLP, Susman Godfrey LLP, Kenny Nachwalter PA, Cadwalader Wickersham & Taft LLP, Boulware Law LLC and Clyde & Co US LLP.

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