Duane Omar Burnett v. United States ( 2021 )

In the United States Court of Federal Claims
No. 16-995L
Filed: June 28, 2021
FOR PUBLICATION
DUANE OMAR BURNETT, et al.,
Plaintiffs, Rails-to-Trails; Fifth
Amendment Takings; Notice
v. of Interim Trail Use;
Abandonment; Partial
UNITED STATES,
Summary Judgment; RCFC 56
Defendant.
John Robert Sears, Baker, Sterchi, et al., St. Louis, Missouri for plaintiffs.
Joseph Hosu Kim, Trial Attorney, Environment & Natural Resources Division, United
States Department of Justice, Washington, D.C., for defendant.
OPINION
FUTEY, Senior Judge
I. INTRODUCTION
This Rails to Trails case is before the Court on plaintiffs’ second motion for partial
summary judgment on state law abandonment. The government has filed a cross-motion for partial
summary judgment alleging that federal law preempts state law regarding abandonment of a
railroad corridor. Plaintiffs are landowners of property located adjacent to a railroad line, the Rock
Island Line, owned by Missouri Central Railroad Company (“MCRR”). They seek to establish
that, under Missouri law, MCRR abandoned its easements located on plaintiffs’ land prior to the
issuance of a Notice for Interim Trail Use (“NITU”), effecting an alleged Fifth Amendment taking
of their reversionary interest in the property. Plaintiffs have brought this action against the federal
government pursuant to the National Trails System Act, 16 U.S.C. §§ 1241–51.
In a previous ruling, the Court determined that the railroad owned some of plaintiffs’
parcels in fee simple and granted summary judgment to the government on these claims.1 Nine
1
The Court determined that MCRR owns in fee simple the property at issue with respect
to plaintiffs’ claims 1 (Atkins); 10 (Kinkead); 13a and b (Morton); 19 (Martin Five Ltd.
Partnership); 22a and b (Value Investments LLC, Estate of John H. and Temple Lee Vance); and
claims remain. As to these claims, the Court previously held that the railroad acquired only
easements located on plaintiffs’ land, and that the easements were sufficiently broad to encompass
public recreational trail use and railbanking. Plaintiffs seek to establish liability with respect to
these claims by showing that they were abandoned under state law prior to the issuance of a Notice
for Interim Trail Use.
Thus, as to the parcels conveyed by easement, the nine plaintiffs now moving for partial
summary judgment on the issue of abandonment are represented by claim numbers 2 (Belle
Community Fair); 3 (Burnett); 5 (Durbin); 6 (Griggs); 7 (Holaway); 11 (Lemons); 17a (Seymour);
20 (Turner); and 21 (Zumwalt). Plaintiffs move on the basis that the railroad abandoned the
easements under Missouri law and a taking occurred when the Surface Transportation Board
(“STB”) subsequently issued a Notice of Interim Trail Use (“NITU”).
To address rails-to-trails takings claims, the United States Court of Federal Claims applies
a three-step analysis set forth by the United States Court of Appeals for the Federal Circuit in
Presault v. United States, 100 F.3d 1525 (Fed. Cir. 1996) (“Presault II”). Presault II established
that liability for a taking by the United States in this context is based upon answers to three
questions:
1. Who owns the strip of land involved, specifically, whether the railroad acquired only
an easement or obtained a fee simple estate;
2. If the railroad acquired only an easement, were the terms of the easement limited to use
for railroad purposes, or did they include future use as a public recreational trail (scope
of easement); and
3. Even if the grant of the railroad’s easement was broad enough to encompass a
recreational trail, had this easement terminated prior to the alleged taking so that the
property owner at the time held a fee simple interest unencumbered by the easement
(abandonment of the easement)?
As stated, the Court previously issued a decision concluding that MCRR owned some of
plaintiffs’ parcels in fee simple, but only acquired use of others by easement. The Court determined
further that these easements were broad enough to encompass public recreational trail use and
railbanking. Now, plaintiffs seek to establish a taking with a determination under the third prong
of Presault II that the easements were terminated, or abandoned, under state law prior to the STB’s
issuance of an NITU.
23 (JHV Holdings, LLC). On this basis, the Court denied plaintiffs’ first motion for partial
summary judgment and granted the government’s cross-motion for summary judgment with
respect to these claims. The Court also determined that plaintiffs Wayne and Gloria Misner (claim
12) did not own property located adjacent to the rail corridor at issue on the date of the issuance
of the NITU. On this basis, the Court also denied this taking claim. The Court dismissed claim
number 14 and 16 on October 4, 2017. The Court’s previous ruling noted that the parties agreed
that MCRR holds easements limited to railroad purposes for claim numbers 4 a and b, 8, 9, 15,
and 18. The parties further agreed that plaintiffs had “no claim” for claim numbers 17b, c, and d.
2
In their motion, plaintiffs argue that abandonment occurred under Missouri law because
the railroad demonstrated its intent to abandon the line by filing a Verified Notice of Exemption
to the STB. Plaintiffs assert that the STB’s subsequent issuance of an NITU was a taking because
it re-established a public easement. Plaintiffs offer other evidence of abandonment under state law,
including press clippings, statements made by the railroad, official public records, eyewitness
testimony and affidavits, and lack of railroad use.
In its cross-motion, the government maintains that federal law must be applied to ascertain
whether abandonment occurred prior to the Court’s consideration of state-law abandonment
factors. Specifically, the government argues that the only legally cognizable way to abandon a
railroad line is to file a Notice of Consummation to the STB pursuant to 49 C.F.R. § 1152.29(e)(2),
which MCRR declined to do. Additionally, the government asserts that the abandonment authority
conferred by the STB to a railroad is permissive, such that a railroad is not compelled to carry out
the abandonment after it has filed a Verified Notice of Exemption. Further, the government argues
that even if there was pre-NITU abandonment, there can be no taking because the NITU would be
invalid and property owners would be barred from challenging the ultra vires act in this Court.
The matter is now ripe for disposition.
I. BACKGROUND
a. Relevant Factual Background
This “rails-to-trails” case involves an alleged taking of real property situated along a 144.3
mile railroad corridor known as the Rock Island Line located in Cass, Pettis, Benton, Morgan,
Miller, Cole, Osage, Maries, Gasconade, and Franklin Counties in the State of Missouri.
Additional factual background of plaintiffs’ claims is provided in an opinion previously
issued by the Court in this matter. Burnett et al. v. United States, 139 Fed. Cl. 797, 801–03 (2018).
In that ruling, the Court resolved most of plaintiffs’ claims by granting partial summary judgment
for the government. The Court determined that nine claims remained, and these were parcels to
which MCRR held easements broad enough to encompass public recreational trail use and
railbanking. See generally Burnett et al., 139 Fed. Cl. 797 (2018). The Court now addresses these
nine easement-based takings claims herein.
On November 18, 2014, MCRR filed a Verified Notice of Exemption to the Surface
Transportation Board (“STB”) pursuant to 49 U.S.C. § 10502 and 49 CFR § 1152.50 to abandon
and discontinue its interest in the Rock Island Line. ECF No. 38-2 at 2–3. The Notice reads:
The MCRR and Central Midland Railway Company submit this joint
verified Notice of Exemption pursuant to 49 U.S.C. § 10502 and 49 C.F.R.
§ 1152.50 for the abandonment and discontinuance of approximately 144.3
miles of rail line in two segments.
3
The Notice asserts that, “MCRR proposes to abandon the Line,” and sets forth a
consummation date for abandonment on or after January 7, 2015. The Certification portion,
required by 49 C.F.R. § 1152.50(b), notes that the MCRR President “confirm[s] no traffic has
originated, terminated, or moved ahead on the Line for at least two years.”
On December 16, 2014, the Missouri Department of Natural Resources filed a request for
the issuance of a Notice for Interim Trail Use (“NITU”) to allow the department to negotiate with
MCRR for the acquisition of the rail corridor for use as a trail under the National Trails Systems
Act. The STB issued the NITU on February 25, 2015. Although the original NITU would have
expired 180 days thereafter, the MCRR requested and received multiple extensions of the NITU.
The last known expiration date of the NITU was February 21, 2019. According to the briefs, no
railbanking and interim-trail-use agreement was established with respect to the Rock Island Line.
MCRR declined to file a notice of consummation pursuant to 49 C.F.R. § 1152.29(e)(2).
Various plaintiffs submitted eyewitness affidavits attesting to the railroad’s abandonment
of the line. Mr. Burnett attested that, “there has been no railroad activity on the railroad line” since
at least September 12, 2007. Mr. Dillon attested that there was no railroad activity on the railroad
line since at least October 13, 2006. He specified that, “[t]rains haven’t run on the Rock Island
Railroad Line since about 1972.” Ms. Jones attested that there was no railroad activity on the
railroad line since September 16, 1992 and that since that time her “step-father kept the brush cut
down on the railroad line right of way until 2009.” Mr. Kidwell attested that there was no railroad
activity on the line in nearly thirty years and that the “brush and sticker bushes were so thick in
the right of way, it was impassable.” Ms. Rackers attested that there was no railroad activity on
the railroad line since March 20, 1986. She specified that, “[t]he section of the railroad line that
intersects with the main crossroad in town, T Road, was paved over with blacktop at the
intersection more than ten years ago.”
The government asserts that MCRR and previous owners transferred the rail line for
continued use as a rail line, allowed fiber optic cables to be laid along the line, and leased portions
of the line to an adjacent landowner. The Rock Island Line corridor was sold in 1996 to Union
Pacific Railroad Company, which sold it to MCRR in 1999. MCRR then sold operating rights to
Central Midland Railway Company in 2004. From 1983 to 2014, Union Pacific and then MCRR
leased a portion of the corridor to Mr. Charles James.
b. Procedural Background
This Court previously denied plaintiffs’ first motion for partial summary judgment on
liability and granted the government’s cross-motion for summary judgment on standing and title
issues on October 9, 2018. Subsequently, the Court stayed the matter pending the United States
Court of Appeals for the Federal Circuit’s decisions in Caquelin v. United States, 697 F. App’x
1016 (Fed. Cir. 2017) or in Memmer v. United States, Nos. 2017-2150, 2017-2230, 2017 WL
6345843 (Fed. Cir. Nov. 16, 2017), or until the railroad reached a trail-use agreement.
Specifically, the Court’s October 2018 ruling addressed the first two questions for liability,
concluding that MCRR owned the land in fee simple and that the scope of the easements under
consideration were broad enough to include recreational trail use. The Court, however, has not
4
considered the third question of whether abandonment occurred under Missouri property law prior
to the STB’s issuance of the NITU until now. Plaintiff’s position is that the government could still
be liable for takings if prior abandonment occurred under state law.
On November 2, 2020, the parties filed a Joint Status Report proposing to file summary
judgment motions on the third question, prior abandonment, and requesting that all other briefing
be stayed. On December 14, 2020, plaintiffs filed a motion for partial summary judgment on the
issue of prior abandonment under Missouri property law. On February 8, 2021, the government
filed a response to plaintiffs’ motion and a cross-motion for partial summary judgment. On March
30, 2021, plaintiffs filed a response to the government’s cross-motion and a reply in support of its
motion for partial summary judgment. On April 23, 2021, the government filed a reply in support
of its motion for partial summary judgment.
With these matters fully briefed, the Court now resolves the pending issue.
II. DISCUSSION
a. Legal Standards
i. Jurisdiction
The Tucker Act grants this Court jurisdiction over Fifth Amendment takings claims
brought against the United States. See 28 U.S.C. § 1491; Morris v. United States, 392 F.3d 1372,
1375 (Fed. Cir. 2004) (“[T]he Tucker Act provides the Court of Federal Claims exclusive
jurisdiction over takings claims for amounts greater than $10,000.”).
ii. Summary Judgment
A grant of summary judgment is appropriate when the pleadings, affidavits, and
evidentiary materials filed in a case reveal that “there is no genuine dispute as to any material fact
and the movant is entitled to judgment as a matter of law.” RCFC 56(a); see Anderson v. Liberty
Lobby, Inc., 477 U.S. 242, 247–48 (1986); Biery v. United States, 753 F.3d 1279, 1286 (Fed. Cir.
2014). A dispute is “genuine” when “the evidence is such that a reasonable jury could return a
verdict for the nonmoving party.” Anderson, 477 U.S. at 248. A fact is “material” if it could “affect
the outcome of the suit under the governing law ....” Id.In resolving motions for summary judgment, the Court will not make credibility
determinations and will draw all inferences “in the light most favorable to the party opposing the
motion.” Matsushita Elec. Indus. Co., Ltd. v. Zenith Radio Corp., 475 U.S. 574, 587–88 (1986)
(quoting United States v. Diebold, Inc., 369 U.S. 654, 655 (1962)). In doing so, the Court does not
weigh the evidence presented, but instead must “determine whether there is a genuine issue for
trial.” Anderson, 477 U.S. at 249; Agosto v. INS, 436 U.S. 748, 756 (1978) (“[A trial] court
generally cannot grant summary judgment based on its assessment of the credibility of the
evidence presented ....”); see also Am. Ins. Co. v. United States, 62 Fed. Cl. 151, 154 (2004). And
5
so, the Court may only grant summary judgment when “the record taken as a whole could not lead
a rational trier of fact to find for the non-moving party ....” Matsushita, 475 U.S. at 587.
The above standard applies when the Court considers cross- motions for summary
judgment. See Principal Life Ins. Co. & Subsidiaries v. United States, 116 Fed. Cl. 82, 89 (2014);
see also Estate of Hevia v. Portrio Corp., 602 F.3d 34, 40 (1st Cir. 2010). And so, when both
parties move for summary judgment, “the court must evaluate each party's motion on its own
merits, taking care in each instance to draw all reasonable inferences against the party whose
motion is under consideration.” Abbey v. United States, 99 Fed. Cl. 430, 436 (2011) (quoting
Mingus Constructors, Inc. v. United States, 812 F.2d 1387, 1391 (Fed. Cir. 1987)).
iii. Fifth Amendment Takings and “Rails-to-Trails” Cases
A Fifth Amendment takings occurs in rails-to-trails cases when the government, through
the issuance of a CITU or NITU, destroys an individual’s state law reversionary interest in property
underyling a railroad right-of-way. Ladd v. United States, 630 F.3d 1015, 1023–24 (Fed. Cir.
2010); Barclay v. United States, 443 F.3d 1368, 1373 (“The issuance of the NITU is the only event
that must occur to ‘entitle the plaintiff to institute an action.’ Accrual is not delayed until a trail
use agreement is executed or the trail operator takes physical possession of the right-of-way.”)
(internal citations omitted). “Only persons with a valid property interest at the time of the taking
are entitled to compensation.” Wyatt v. United States, 271 F.3d 1090, 1096 (Fed. Cir. 2001).
As previously mentioned, to determine whether a Fifth Amendment takings has occurred
in a rails-to-trails case, the Court follows a three-step analysis established by the United States
Court of Appeals for the Federal Circuit. See Ellamae Phillips Co. v. United States, 564 F.3d 1367,
1373 (Fed. Cir. 2009) (citing Presault v. United States, 100 F.3d 1525, 1533 (Fed. Cir. 1996)
(“Presault II”). First, the Court must determine who owned the land at issue at the time of the
takings. Id. Second, if the railroad company owned only an easement, the Court must determine
whether the terms of the easement include use as a public recreational trail. Id. Third, if the railroad
company’s easement is broad enough to encompass recreational trail use, as the Court has decided
in this matter, the Court must then determine whether the easement terminated prior to the alleged
takings, so that that property owner held a fee simple estate unencumbered by easement at the time
of the takings. Id.iv. Abandonment
1. Federal Law and Regulations
For more than a century, the federal government has exercised plenary authority over the
abandonment of most railroad corridors in the United States. See Transportation Act of 1920, ch.
91, 41 Stat. 456 (1920) (the “Transportation Act”). The Interstate Commerce Act of 1887, Pub. L.
No. 95-473, 92 Stat. 1337 (recodified at 49 U.S.C. §§ 1101, 1121) and the Transportation Act
(recodified at 49 U.S.C. § 10903) grant regulatory jurisdiction to the Interstate Commerce
Commission (“ICC”), which is possessed now by its successor, the Surface Transportation Board
(“STB” or “Board”).2 See Chicago & N.W. Transp. Co. v. Kalo Brick & Tile Co., 450 U.S. 311,
2
See generally Burnett et al. v. United States, 139 Fed. Cl. 797, 801–06 (2018).
6
321 (1981). A railroad seeking to abandon a railroad right-of-way within the jurisdiction of the
STB must either (1) file a standard abandonment application that meets the requirements of 49
U.S.C. § 10903, or (2) seek an exemption under 49 U.S.C. § 10502.
As relevant here, a rail carrier qualifies for an exemption if it certifies that no local traffic
has moved over the line for at least two years and that any overhead traffic can be rerouted over
other lines. 49 C.F.R. § 1152.50(b). The National Trails System Act Amendments of 1983, Pub.
L. No. 98-11, § 208, 97 Stat. 42, 48 (“Trails Act”), provides for blocking of “abandonment,”
however, despite the absence of any rail use, present or in prospect, if a proper entity agrees with
the railroad to take over the rail right-of-way for trail use. 16 U.S.C. § 1247(d). Such trail use is
deemed “interim,” id., and the term “rail banking” is applied, 49 C.F.R. § 1152.29(a), because rail
use may someday be restored.
When a rail carrier applies for permission to abandon, as MCRR did, the Board’s
regulations provide that any prospective trail sponsor may file a comment indicating an interest
“in acquiring or using a right-of-way of a rail line ... for interim trail use and rail banking.” 49
C.F.R. § 1152.29(a). If the rail carrier agrees to negotiate an agreement with such a potential trail
sponsor, the Board will issue to the rail carrier and potential trail sponsor a NITU providing for a
180-day negotiation period. Id. § 1152.29(d)(1); see also Preseault v. Interstate Commerce
Commission, 494 U.S. 1, 7 n.5 (1990) (Preseault I). Consistent with the limitation of potential
outcomes recognized in the full name—“a Notice of Interim Trail Use or Abandonment”—the
NITU generally provides that the rail carrier may, during the NITU period, continue the process
of physical abandonment, i.e., may “discontinue service, cancel any applicable tariffs, and salvage
track and materials.” 49 C.F.R. § 1152.29(d)(1); see also Preseault I, 494 U.S. at 7 n.5. If the
parties reach an agreement, and duly notify the Board, the right-of-way remains under Board
jurisdiction indefinitely while used as a recreational trail, and state law may not treat that “interim
use ... as an abandonment of the use of such rights-of-way for railroad purposes.” 16 U.S.C. §
1247(d). If the parties fail to reach an agreement, and the NITU expires, the rail carrier gains
authority to abandon; that authority does not mandate abandonment, but if the rail carrier does not
exercise the authority within a one-year period defined by regulation, it cannot abandon without
filing a new request for abandonment authority. 49 C.F.R. § 1152.29(d)(1), (e)(2).
Section 8(d) specifically provides that “such interim use [for trails] shall not be treated, for
purposes of any [state] law or rule of law, as an abandonment of the use of such rights-of-way for
railroad purposes.” 16 U.S.C.A. § 1247(d). Thus, section 8(d) of the Trails Act prevents the
operation of state laws that would otherwise come into effect upon abandonment – property laws
that would “result in extinguishment of easements for railroad purposes and reversion of rights of
way to abutting landowners.” Rail Abandonments—Use of Rights–of–Way as Trails, Ex Parte No.
274 (Sub–No. 13), 2 I.C.C.2d 591, 1986 WL 68617 (1986); see also Caldwell v. United States,
391 F.3d 1226, 1229 (Fed. Cir. 2004).
A railroad that receives authority from the Board to abandon a line (in a regulated
abandonment proceeding under 49 U.S.C. 10903, or by individual or class exemption issued under
49 U.S.C. 10502) shall file a notice of consummation with the Board to signify that it has exercised
the authority granted and fully abandoned the line (e.g., discontinued operations, salvaged the
track, canceled tariffs, and intends that the property be removed from the interstate rail network).
7
49 C.F.R. § 1152.29(e)(2). “[I]t is only upon actual consummation of the abandonment that the
STB’s jurisdiction ceases.” Baros v. Texas Mexican R.R. Co., 400 F3d 228, 236 (5th Cir. 2005).
“[T]he filing of a notice of consummation now provides the only legally recognizable way to
consummate abandonment of a rail line that is subject to the Board’s licensing requirements.”
Honey Creek R.R., Inc.—Petition for Decl. Order, 2008 WL 2271465 (S.T.B.) at 5 (STB served
June 4, 2008).
The consummation notice shall be filed within one year of the service date of the decision
permitting the abandonment. Id. Notices will be deemed conclusive on the point of consummation
if there are no legal or regulatory barriers to consummation (such as outstanding conditions,
including Trails Act conditions). Id. If, after one year from the date of service of a decision
permitting abandonment, consummation has not been effected by the railroad’s filing of a notice
of consummation, and there are no legal or regulatory barriers to consummation, the authority to
abandon will automatically expire. Id. In that event, a new proceeding would have to be instituted
if the railroad wanted to abandon the line. Id.
2. Missouri Abandonment Law
Railroads are subject to regulation by the federal government, while the property rights of
railroads and landowners lie solely within the bounds of state law. Glosemeyer v. United States,
45 Fed. Cl. 771, 773 (2000). Because the Rock Island line is located in the State of Missouri,
Missouri law applies in this case. Presault I, 494 U.S. at 20–21 (O’Connor, J., concurring).
A railroad easement is extinguished in Missouri when “the railroad ceases to run trains
over the land.” Schuermann Enterprises, Inc. v. St. Louis County, 436 S.W.2d 666, 668 (Mo. 1969
citing State Highway Comm’n v. Griffith, 114 S.W.2d 976, 980 (Mo. 1938)). Property owners hold
their property free from the burden of any easement once the railroad ceases to use the property
for railroad purposes. Boyles v. Mo. Friends of the Wabash Trace Nature Trail, Inc., 981 S.W.2d
644, 649–50 (Mo. App. W.D. 1998). Abandonment is shown with proof that the railroad intended
to abandon without the intention to possess it again. Moore v. Mo. Friends of the Wabash Trace
Nature Trail, Inc., 991 S.W.2d 681, 688 (Mo. App. W.D. 1999) (citing Boyles, 981 S.W.2d at
648). “An intention to abandon is inferred by the discontinuance of rail service with no prospect
for resumption of service.” Kansas City Area Transp. Auth. v. 4550 Main Assoc., Inc., 742 S.W.2d
182, 191 (Mo. App. W.D. 1986).
Once abandonment has been established, there is a Fifth Amendment taking when the
government asserts its control over a previously abandoned railroad corridor, such as by issuing
an NITU. Presault II, 100 F.3d at 1533; Ellamae Phillips Co., 564 F.3d at 1373.
8
b. Analysis
The Court previously determined that the easements at issue in this case are not limited to
railroad use. Rather, they are sufficiently broad to encompass recreational trail use or railbanking,
as occurred here. Therefore, to establish a compensable taking, plaintiffs must demonstrate that
MCRR fully abandoned the easements before the STB issued the NITU.3 Without abandonment,
the easements would remain.
Here, plaintiffs seek to establish that a compensable taking occurred when the STB issued
an NITU to MCRR. They rely on Presault II and Ellamae Phillips Co. because, in those cases, the
Federal Circuit ruled that when the federal government asserts its control over a previously
abandoned railroad corridor, such as by issuing an NITU, a Fifth Amendment taking occurs.
Plaintiffs must first, however, demonstrate that MCRR abandoned the Rock Island Line before the
STB issued the NITU.4 Plaintiffs contend that abandonment did precede the issuance of the NITU
because, under Missouri law, abandonment is shown with proof of a railroad’s intent to abandon.
Plaintiffs assert that MCRR’s filing of the Verified Notice of Exemption in which it proposes to
abandon the Rock Island Line, plus eyewitness testimony as to the apparent lack of railroad use,
satisfies the Missouri abandonment test.
Nonetheless, plaintiffs’ contention that abandonment occurred under Missouri state law
puts the cart before the horse. Until the STB relinquishes jurisdiction over a rail line, state law is
irrelevant. The Federal Circuit clarified in Caquelin that “a NITU does not effect a taking if, even
in the absence of a NITU, the railroad would not have abandoned its line (a necessary prerequisite
for termination of the easement under state law) during the period of the NITU” (emphasis added).
959 F.3d at 1363. This is because, where an abandonment is conditional, the STB retains
jurisdiction over a line until it has been abandoned pursuant to the conditions imposed by the
agency. Baros, 400 F.3d 228, 234–35 (2005). Here, the abandonment authority granted by the STB
was conditioned upon MCRR’s negotiation of the acquisition of the line for public use. Because
the Rock Island Line was subject to the STB’s jurisdiction and licensing requirements, the only
legally recognizable way for MCRR to consummate abandonment of the Rock Island Line would
have been to file a notice of consummation. See Baros at 234–35; see also Honey Creek R.R., Inc.
– Petition for Decl. Order at 5.
3
The third prong of the Presault II test asks: even if the grant of the railroad’s easement
was broad enough to encompass a recreational trail, had this easement terminated prior to the
alleged taking so that the property owner at the time held a fee simple interest unencumbered by
the easement?
4
MCRR filed the Verified Notice of Exemption on November 18, 2014. The STB issued
the NITU on February 25, 2015. Although the original NITU would have expired 180 days
thereafter, the MCRR requested and received multiple extensions of the NITU. The last known
expiration date of the NITU was February 21, 2019.
9
MCRR never filed a notice of consummation, which would have ended STB’s regulatory
jurisdiction and completed a full abandonment of the line. Only then would consideration of state
law abandonment factors, such as evidence of an intent to abandon be necessary or possible.
Because MCRR did not file a notice of consummation, STB retained regulatory jurisdiction over
the railroad corridor and the underlying property.
Plaintiffs cite also to Caquelin v. United States, a rails-to-trails case in which the Federal
Circuit recently upheld another judgment that a taking occurred under the state law of Iowa when
the STB issued an NITU. 959 F.3d 1360 (Fed. Cir. 2020). The Court reasoned that the railroad’s
filing of an application to abandon, coupled with evidence of track removal, was sufficient
evidence to conclude that the railroad would have completed abandonment while the NITU was
in effect. 959 F.3d at 1373; see also Glosemeyer v. United States, 45 Fed. Cl. 771, 777 (2000)
(“[T]he railroads’ applications to the ICC for authority to abandon are clear evidence of intent to
abandon their easements). In Caquelin, no trail use agreement was reached during the 180-day
negotiation period, and the railroad refused to consent to an extension of its consummation date,
“confirming its interest in abandoning sooner rather than later.” Caquelin, at 1373.
Three important distinctions can be made between Caquelin and the case now before the
Court. First, the railroad in Caquelin filed a notice of consummation, which ended the STB’s
regulatory jurisdiction and completed the regulatory abandonment process, thereby allowing for
the courts’ subsequent consideration of Iowa state law as to property interests. Second, the
easements at issue were limited to railroad use.5 Caquelin v. United States, 140 Fed. Cl. 564, 568
(2018). Therefore, under Iowa state law, they were capable of being extinguished through lack of
railroad use. Here, however, the easements were not limited to railroad use, so plaintiffs’ evidence
of line removal, overgrowth, and general lack of railroad use do not establish abandonment. Third,
the railroad in Caquelin refused to consent to an extension of its consummation date, which the
Court considered to be evidence of the railroad’s interest in immediate abandonment. Here,
conversely, MCRR requested multiple extensions, which would indicate that MCRR intended to
delay its abandonment of the Rock Island Rail Line, if the Court were considering abandonment
under state law factors.
The Court notes further that the regulatory abandonment process is a permissive one. When
a railroad submits an exemption request under the Trails Act, the STB’s acceptance of the request
merely grants the railroad the authority to pursue abandonment. If, after one year from the date of
service of a decision permitting abandonment, consummation has not been effected by the
railroad’s filing of a notice of consummation, and there are no legal or regulatory barriers to
consummation, the authority to abandon will automatically expire. In that event, a new proceeding
would have to be instituted if the railroad wanted to abandon the line. MCRR declined to file a
notice of consummation in accordance with 49 CFR § 1152.29(e)(2). Thus, MCRR did not
complete the regulatory abandonment process.
5
“The successor railroad held easements limited to railroad purposes that were exceeded
by issuance of the NITU, rendering the government liable for taking plaintiffs’ property without
just compensation under the Fifth Amendment.” Caquelin v. United States, 140 Fed. Cl. 564, 568
(2018).
10
Because abandonment must be consummated according to federal law and regulations and
MCRR declined to file a notice of consummation, plaintiffs’ argument that MCRR abandoned the
rail line, even under state law factors, fails as a matter of law.
III. CONCLUSION
For the above stated reasons, the following is hereby ordered:
1. Plaintiffs’ motion for partial summary judgment is DENIED.
2. Defendant’s motion for partial summary judgment and cross-motion are GRANTED.
The Clerk is directed to enter judgment accordingly. No costs.
It is so ORDERED.
s/ Bohdan A. Futey
Bohdan A. Futey
Senior Judge
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