D.C. CIRCUIT UPHOLDS RULING AGAINST RAILROAD COMPANIES IN A CASE INVOLVING AN ALLEGED FUEL SURCHARGE PRICE-FIXING SCHEME
June 8, 2022
On May 17, 2022, a D.C. Circuit Court appellate panel decided to uphold most of a lower court’s ruling requiring certain discussions about interline shipping conducted between rail carriers to be included as evidence in ongoing litigation in which the U.S.’s four largest railroad companies, Union Pacific Railroad Co., CSX Transportation Inc., Norfolk Southern Railway Corp. and BNSF Railway Co. have been accused by rail shippers of being involved in a fuel surcharge price-fixing scheme. The rail shippers claimed that the four companies had been working together for years to fix the price of fuel surcharges and agreed not to compete on their prices to keep prices high, which the shippers claim cost them billions of dollars over the course of several years. The rail carriers’ main argument in response to the shippers’ claims was that according to 49 U.S.C. § 10706, in antitrust trials evidence based on conversations between rail carriers about interline shipping cannot be heard, provided that those conversations by themselves would not constitute an antitrust violation. However, the appellate panel found that such conversations must do more than simply mention interline shipping to qualify for the evidence exclusion provided for in § 10706, and that in the instant case, the rail carriers would have to show that the movements at issue are their shared interline traffic to enjoy the kind of blanket protection on their conversations that they were seeking. The appellate panel therefore rejected the rail carriers’ arguments that the law excludes discussion of anything with a connection to their shared interline traffic. Consequently, the rail shippers who brought the case are now able to freely introduce evidence of the carriers’ conversations and/or agreements during which they allegedly colluded to coordinate fuel surcharges on their respective freight and single-line traffic.
If you have any questions, please contact Evelyn Sahr (esahr@eckertseamans.com 202-659-6622) or Drew Derco (dderco@eckertseamans.com 202-659-6665).
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