Tubbs v. Surface Transportation Board

United States Court of Appeals
For the Eighth Circuit
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No. 14-3898
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Thomas Tubbs, Trustee of theThomas Tubbs Revocable Trust and Individually;
Dana Lynn Tubbs, Trustee of the Dana Lynn Tubbs Revocable Trust and Individually
lllllllllllllllllllllPetitioners
v.
Surface Transportation Board; United States of America
lllllllllllllllllllllRespondents
BNSF Railway Company; Massman Construction Company
lllllllllllllllllllllIntervenors
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Petition for Review of an Order of the
Surface Transportation Board
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Submitted: September 21, 2015
Filed: December 28, 2015
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Before MURPHY, MELLOY, and SMITH, Circuit Judges.
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SMITH, Circuit Judge.
Flood waters from the Missouri River heavily destroyed the family farm of
Thomas and Dana Lynn Tubbs in 2011. The Tubbses attribute the total loss to BNSF
Railway Company's maintenance of a railway embankment running across their farm.
The Surface Transportation Board ("Board") concluded that the Interstate Commerce
Commission Termination Act, 49 U.S.C. § 10501(b), (ICCTA) preempts the Tubbses'
state-law claims. We deny the Tubbses' petition for review.
I. Background
The Tubbses own a 550-acre farm near the Missouri River. BNSF owns and
operates a railroad track over an earthen embankment that bisects the Tubbses' farm.
Because of its height, the embankment blocks the free flow of water across the
landscape even though BNSF maintains drainage conduits through the embankment
to avoid excess buildup of water. On occasion, BNSF has raised the embankment to
prevent water from spilling over the tracks and interrupting rail traffic. But as the
height of the embankment increased, BNSF did not provide additional drainage
capacity or buttress the structural foundation of the embankment to support the
increased volume of dammed water. In anticipation of the 2011 flood season, BNSF
elevated the embankment. Unfortunately, record-setting flood waters breached the
freshly raised embankment later that summer. The resulting rapid flow of water
washed away the fertile soil on the Tubbses' farm.
The Tubbses filed suit in state court against BNSF and its contractor, Massman
Construction Company, seeking damages for state-law torts, including trespass,
nuisance, negligence, inverse condemnation, and statutory trespass. The state court
stayed the litigation and permitted the Tubbses to seek clarification from the Board
with respect to whether the ICCTA preempts their state-law claims.
Upon review, the Board concluded that the ICCTA preempted the Tubbses'
state-law claims but that they retained a federal claim based on BNSF's alleged
violation of federal regulations under the Federal Railroad Safety Act (FRSA). The
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Board's preemption analysis noted that "[s]ection 10501(b) categorically preempts
states or localities from intruding into matters that are directly regulated by the
Board," and that "state and local actions may be preempted . . . if they would have the
effect of unreasonably burdening or interfering with rail transportation." The Board
reasoned that the Tubbses' state-law tort claims are preempted because "they would
have the effect of managing or governing rail transportation." The Board followed
precedent from a number of courts that have applied the unreasonable-burden-or-
interference analysis. Additionally, the Board rejected the Tubbses' contention that
preemption applies only when there is a federal equivalent of the preempted state-law
remedy. Finally, the Board concluded that section "10501(b) does not preempt the
FRSA regulations on drainage under railroad tracks. [The Tubbses'] tort claims based
on alleged violations by BNSF of these regulations are therefore also not preempted
by § 10501(b)."
The Tubbses appealed. We have jurisdiction to review the Board's final order
pursuant to 28 U.S.C. §§ 2321, 2342(5).
II. Discussion
This appeal raises two questions—one of law and one of fact. The first is
whether the Board's unreasonable-burden-or-interference test is the appropriate test
for determining if the Tubbses' state-law claims are preempted under the ICCTA. The
second is whether the facts support state-law claims that would unreasonably burden
or interfere with rail transportation.
A. Standard of Review
This case comes to us as a petition for review of the decision of the Board; it
is not an appeal from a district court. "Because Congress has entrusted the Board with
interpreting and administering the [ICCTA], in reviewing its decisions we ask only
whether they are based on a permissible construction of the statute." MidAmerican
Energy Co. v. Surface Transp. Bd., 169 F.3d 1099, 1106 (8th Cir. 1999) (quotations
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and citations omitted). This review standard notwithstanding, the Tubbses assert that
we should review the Board's order de novo. For support, they cite the Fifth Circuit's
opinion in Franks Investment Co. LLC v. Union Pacific Railroad Co., 593 F.3d 404,
407 (5th Cir. 2010) (en banc). But this case, unlike Franks, involves an appeal
directly from an administrative decision of the Board. See id. at 406. Instead, because
the ICCTA "is silent or ambiguous with respect to the specific issue [of testing for as-
applied preemption], the question for [this] court is whether the [Board's] answer is
based on a permissible construction of the statute." Chevron, U.S.A., Inc. v. Natural
Res. Def. Council, Inc., 467 U.S. 837, 843 (1984).
The Board's unreasonable-burden-or-interference test is fact intensive. The
scope of our review is therefore "quite narrow." City of Lincoln v. Surface Transp.
Bd., 414 F.3d 858, 860–61 (8th Cir. 2005). "As long as the Board's findings of fact
are supported by substantial evidence in the record as a whole, we will accept its
findings and the reasonable inferences it drew from them." Id. (citation omitted).
B. The Tubbses Failed to Properly Challenge the Board's Use
of the Unreasonable-Burden-or-Interference Test for As-Applied Preemption
The ICCTA provides that
The jurisdiction of the Board over—
(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,
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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). When determining whether the ICCTA preempts the Tubbses'
state-law claims as applied, the Board asked whether those claims "would have the
effect of unreasonably burdening or interfering with rail transportation." In doing so,
"[t]he Board analyze[d] the facts and circumstances of the case." Several of our sister
circuits have approved of this test in cases of as-applied preemption. See, e.g., Franks
Inv. Co. LLC, 593 F.3d at 414; Island Park, LLC v. CSX Transp., 559 F.3d 96, 103
(2d Cir. 2009); PCS Phosphate Co. v. Norfolk S. Corp., 559 F.3d 212, 220–21 (4th
Cir. 2009); Adrian & Blissfield R. Co. v. Vill. of Blissfield, 550 F.3d 533, 540 (6th Cir.
2008); New York Susquehanna & W. Ry. Corp. v. Jackson, 500 F.3d 238, 254 (3d Cir.
2007); Emerson v. Kansas City S. Ry. Co., 503 F.3d 1126, 1133 (10th Cir. 2007).
An appeal challenging the Board's test must show that the test employed is not
"based on a permissible construction of the statute." MidAmerican Energy Co.,
169 F.3d at 1106 (quotations and citations omitted). The Tubbses have failed to
present that argument on appeal. Instead, they argue that "'without a federal cause of
action which in effect replaces a state law claim, there is an exceptionally strong
presumption against [ ] preemption.'" (Quoting Johnson v. MFA Petroleum Co.,
701 F.3d 243, 252 (8th Cir. 2012).) In short, the Tubbses propose a different test for
preemption that requires a one-to-one replacement of state-law claims with federal
claims. We decline to consider the Tubbses "better test" because they have not shown
that the Board's test constitutes an impermissible construction of the ICCTA. The
Tubbses's challenge of the unreasonable-burden-or-interference test thus fails.
Moreover, the Tubbses cannot prevail under their own test because they have
not established that they have no federal remedies remaining. Indeed, they embrace
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the surviving tort claims that are "based on alleged violations by BNSF of [the FRSA]
regulations."
Finally, the Tubbses argue that the Board has prevented them from bringing a
claim for just compensation under the Fifth and Fourteenth Amendments. In short,
the Tubbses claim that the Board has foreclosed their ability to bring a claim based
on the Takings Clause of the Constitution and thus affected a taking. We are not
persuaded. The loss of a cause of action, which is not a vested interest until it is
reduced to a final judgment, is too speculative to constitute a taking. See Jones Truck
Lines, Inc. v. Whittier Wood Products Co. (In re Jones Truck Lines, Inc.),
57 F.3d 642, 651 (8th Cir. 1995). Additionally, the Tubbses have not explained how
their right to just compensation protects the particular state-law remedies they seek.
Nor have they explained why their remaining federal remedies—including their claim
that BNSF is liable under the FRSA—are insufficient to protect their constitutional
rights.
In sum, we will not overturn the Board's use of the unreasonable-burden-or-
interference test for as-applied preemption under the ICCTA because the Tubbses
have failed to properly challenge it.
C. The Tubbses' State-Law Claims Unreasonably Burden or Interfere with Rail
Transportation
The Tubbses argue that their "state law claims arising from a common law duty
do not regulate rail traffic" but instead provide "a remedy for wrongs that have
already occurred." In short, the Tubbses disagree with the factual finding of the Board
that their state-law claims will unreasonably burden or interfere with rail
transportation. Because our review of factual findings is "quite narrow," we must
determine whether the Board's findings are "supported by substantial evidence in the
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record as a whole," accepting "the reasonable inferences [the Board] drew" therefrom.
City of Lincoln, 414 F.3d at 860–61 (citations omitted).
In this case, the Board found that the state-law claims would unreasonably
burden or interfere with rail transportation because they are "based on alleged harms
stemming directly from the actions of a rail carrier, BNSF, in designing, constructing,
and maintaining an active rail line—actions that clearly are part of 'transportation by
rail carriers.'" The Board noted that if state-law claims directed at such an "integral
part of . . . rail transportation" were not preempted, they would interfere with BNSF's
"ability to uniformly design, construct, maintain, and repair its railroad line." These
findings are supported by the Tubbses' pleadings. They assert that BNSF is liable
because "[a]t the time of the 2011 flood, the embankment had only 134 feet of
drainage openings in its five mile span" when "the height and length of the
embankment required ten times that amount to accommodate anticipated flooding."
Further, they argue that the applicable standard of care required BNSF to "stabilize
the structure by widening the base of the embankment to accommodate [the]
additional height . . . [or] create . . . additional drainage openings to reduce the
damming effect." The Board could reasonably infer that the Tubbses' state-law claims
would unreasonably burden or interfere with rail transportation based on their
assertion that BNSF's conduct fell below its standard of care by not meeting required
width and drainage specifications for the embankment.
Before the Board, the Tubbses relied on two cases for legal support that
preemption was not appropriate. The Board correctly distinguished both cases. First,
in Emerson, "[t]he Landowners claim[ed] that . . . improperly discarded railroad ties
and vegetation debris impeded the flow of water through the drainage ditch and
culvert system adjacent to their properties." 503 F.3d at 1128. The Tenth Circuit held
that "no ICCTA provision gives the [Board] authority to dictate how the Railroad
should dispose of detritus or maintain drainage ditch vegetation. Nor would the state
remedies adversely affect the economic aspects of the Railroad's operations subject
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to [the Board's] control." Id. at 1132. The factual differences between Emerson and
this case are significant. Where Emerson dealt with the improper disposal of railroad
ties and vegetation debris, this case deals with the structural standards applicable to
an earthen embankment on which a railroad runs, standards that would have a
significant impact on the construction and maintenance of a rail line.
Second, the Board distinguished Guild v. Kansas City Southern Railway Co.,
541 F. App'x 362, 368 (5th Cir. 2013). In that case, the Fifth Circuit held that a state-
law tort claim was not preempted because the railroad had not provided evidence in
support of its "assertions that the [plaintiffs'] negligence claim would somehow affect
rail transportation." Id. at 368 (citation omitted). There is no similar lack of evidence
in this case. The Tubbses advance a standard of care that would, in essence, subject
construction of elevated railroad embankments to state regulation for height, width,
and drainage via negligence actions.
In sum, we will not overturn the Board's factual determination that the Tubbses'
state-law claims would unreasonably burden or interfere with rail transportation
because that determination is supported by substantial evidence in the record.
III. Conclusion
Accordingly, we deny the Tubbses' petition for review of the decision of the
Surface Transportation Board.
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