Pejepscot Indus. Park v. Maine Cent. R.R. Co.
| Decision Date | 08 March 2000 |
| Docket Number | No. 99-2016,99-2016 |
| Citation | 215 F.3d 195 |
| Parties | (1st Cir. 2000) PEJEPSCOT INDUSTRIAL PARK, INC. D/B/A GRIMMEL INDUSTRIES, PLAINTIFF, APPELLANT, V. MAINE CENTRAL RAILROAD CO., SPRINGFIELD TERMINAL RAILWAY CO., GUILFORD TRANSPORTATION INDUSTRIES, INC., DEFENDANTS, APPELLEES. . Heard |
| Court | U.S. Court of Appeals — First Circuit |
APPEAL FROM THE UNITED STATES DISTRICT COURT FOR THE DISTRICT OF MAINE. Hon. Gene Carter, U.S. District Judge.
James T. Kilbreth, with whom Rita H. Logan and Verrill & Dana, Llp were on brief, for appellant.
Eric L. Hirschhorn, with whom Winston & Strawn, Glen L. Porter, Thad B. Zmistowski, and Eaton, Peabody, Bradford & Veague, P.A. were on brief, for appellees.
Before Stahl, Circuit Judge, Bownes, Senior Circuit Judge, and Lynch, Circuit Judge.
In 1995, Congress enacted the ICC Termination Act (ICCTA),1 which abolished the 108-year-old Interstate Commerce Commission and substantially deregulated the rail and motor carrier industries. See H.R. Rep. No. 104-311, at 82 (1995), reprinted in 1995 U.S.C.C.A.N. 793, 793. In the ICC's place, the ICCTA established the Surface Transportation Board (STB) within the Department of Transportation. See 49 U.S.C. § 701(a).
The central question in this case is whether the federal district courts have jurisdiction over a shipper's claim that a rail carrier has violated the ICCTA provision that requires carriers to provide service upon reasonable request. See 49 U.S.C. § 11101(a) (). The district court held that the STB's jurisdiction over such claims is exclusive, and thus the federal courts have no jurisdiction, except to enforce certain orders issued by the STB. See Pejepscot Indus. Park, Inc. v. Maine Cent. R.R. Co., 59 F. Supp. 2d 109, 114-15 (1999). Accordingly, the court dismissed with prejudice the shipper's ICCTA claim for lack of subject matter jurisdiction and declined to exercise supplemental jurisdiction over its state law claims. See id. at 115. We hold that the district court has subject matter jurisdiction over the shipper's ICCTA claim, and that it should stay that claim while referring it to the STB under the doctrine of primary jurisdiction.
For the purpose of determining whether the district court has subject matter jurisdiction, we take the well-pleaded allegations in plaintiff's complaint as true. See Puerto Rico Tel. Co. v. Telecommunications Reg. Bd., 189 F.3d 1, 7 (1st Cir. 1999). Founded in 1992, plaintiff Pejepscot Industrial Park, Inc. (d/b/a Grimmel Industries) engages in the business of salvaging, selling, and shipping scrap metal. Grimmel's facility in Topsham, Maine is connected by a 3,000-foot spur railroad track (the Pejepscot Spur Line) to the Lewiston Industrial Track, the main railroad track in the area.
In February 1991 one of the defendants, Maine Central Railroad ("MEC," a common carrier providing railroad freight services), executed a deed granting sections of the Lewiston Industrial Track to the State of Maine, including the Lewiston Lower Road Branch, the part of the main line to which the Pejepscot Spur Line connects. In conveying the Lewiston Lower Road Branch, however, MEC expressly reserved "a certain parcel of land in Topsham known as the 'Pejepscot Spur Line.'" (According to the complaint, MEC does not own the land over which the Pejepscot Spur Line runs; that land is owned by Grimmel and its neighbor, the Eastbrook Timber Company.) It is this spur line, and defendants' desire to rip it up and sell it for scrap, that is at the heart of this case.
As part of the sale of portions of the Lewiston Industrial Track, MEC entered into a freight easement agreement with the State of Maine. The agreement provided that MEC retained all of its rights and obligations under federal law to provide common carrier freight service to shippers located on the lines conveyed to the state.
By 1994, Grimmel was ready to begin shipping scrap metal. The most efficient way to transport scrap metal is by rail. Grimmel requested that the defendants (MEC, Springfield Terminal Railway, which operates MEC's railroad, and their common owner, Guilford Transportation Industries) provide common carrier freight service to Grimmel's Topsham facility. Defendants refused, claiming that no appropriate rail cars were available. Grimmel shipped its material by different means for a time, and then requested rail service again. This time, defendants quoted Grimmel shipping rates, which Grimmel accepted. Before Grimmel could actually begin shipping, however, defendants again refused to provide service. Grimmel later began negotiations with the State of Maine over repairs to the Lewiston Lower Road Branch and the provision of service to Grimmel's facility in anticipation of MEC's formal abandonment of rail service on the Lewiston Industrial Track line.
In June 1998, MEC filed with the STB a Notice of Exemption for abandonment and discontinuance of service over the Lewiston Industrial Track line. MEC represented that the state already owned the Lewiston Lower Road Branch portion of the line, and that the State of Maine, or a third party acting in conjunction with it, would acquire the remainder of the line and/or operating rights over it after it was abandoned. MEC also maintained that no salvage operations would be undertaken after abandonment -- that is, that the line would not be torn up -- and that the abandonment would not affect carrier operations in the area. The STB permitted MEC to abandon the line.
Defendants subsequently informed Grimmel that they intend to rip up the Pejepscot Spur Line and sell it for scrap. The state has agreed to upgrade the Lewiston Lower Road Branch, provided Grimmel upgrades the Pejepscot Spur Line. Grimmel has asked for MEC's permission to do so (at Grimmel's expense), but MEC has refused to grant permission. MEC's refusal prevents Grimmel from obtaining rail freight service.
Grimmel filed a six-count First Amended Complaint in the district court. Count I sought a declaration of ownership rights of the Pejepscot Spur Line, while Count II sought an injunction to prevent defendants from destroying the spur or interfering with Grimmel's right to repair, maintain, and use it. Count III alleged that the defendants unlawfully refused to provide rail service in violation of 49 U.S.C. § 11101(a), which requires rail carriers to provide service to shippers on reasonable request.
Count IV of Grimmel's complaint alleged that defendants violated their duty to Grimmel as a third-party beneficiary of the freight easement agreement between MEC and the State of Maine. Counts V and VI alleged breach of contract and tortious interference with business advantage and expectancies. Before answering the complaint, defendants moved under Fed. R. Civ. P. 12(b)(1) to dismiss the action with prejudice for lack of subject matter jurisdiction, or, in the alternative, to dismiss the action without prejudice under the doctrine of primary jurisdiction for all the issues within the special expertise of the STB.
Grimmel's complaint asserted two bases of subject matter jurisdiction: federal question jurisdiction under 28 U.S.C. § 1331 and supplemental jurisdiction under 28 U.S.C. § 1367(a). The federal question identified was whether the defendants' refusal to provide rail service to Grimmel (and their planned destruction of the spur) had violated the ICCTA -- specifically, 49 U.S.C. § 11101(a). The district court held that the ICCTA gave the STB exclusive jurisdiction over Grimmel's claim and granted defendants' motion to dismiss.
(1) transportation by rail carriers, and the remedies provided in this part with respect to rates, classifications, rules (including car service, interchange, and other operating rules), practices, routes, services, and facilities of such carriers; and
(2) the construction, acquisition, operation, abandonment, or discontinuance of spur, industrial, team, switching, or side tracks, or facilities, even if the tracks are located, or intended to be located, entirely in one State, is exclusive. Except 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) (emphasis added).
Read in isolation, this language appears to grant the STB exclusive jurisdiction over any claim involving "transportation by rail carriers," id. § 10501(b)(1) -- an extremely broad category. However, despite the description in § 10501(b) of the STB's jurisdiction as "exclusive," other sections of the ICCTA permit the filing of certain types of suits in federal district court. See Pejepscot, 59 F. Supp. 2d at 113. For example, 49 U.S.C. § 11705(a) establishes a three-year statute of limitations on civil actions by rail carriers to recover payment for services provided; § 11705(b) establishes a three-year statute of limitations on civil actions by shippers to recover overcharges; and § 11706(d) authorizes civil actions by shippers to recover under a receipt or bill of lading. See id.; see also DeBruce Grain, Inc. v. Union Pac. R.R. Co., 983 F. Supp. 1280, 1283-84 (W.D. Mo. 1997) (), aff'd on other grounds, 149 F.3d 787 (8th Cir. 1998). It is difficult to reconcile these provisions with the notion that the STB has exclusive jurisdiction over all matters under the ICCTA.
The district court concluded that while these provisions undermine the exclusivity of the STB's jurisdiction, none of them were applicable to Grimmel's claim under § 11101(a) for unlawful...
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