United States District Court, E.D. Washington
UNITED STATES OF AMERICA, ex rel., RANDOLPH PETERSON and TRI-CITY RAILROAD COMPANY, LLC, Plaintiffs,
PORT OF BENTON COUNTY, et al., Defendants.
ORDER DENYING PLAINTIFFS' MOTION FOR PARTIAL
SUMMARY JUDGMENT AGAINST THE CITY OF RICHLAND
O. RICE CHIEF UNITED STATES DISTRICT JUDGE.
THE COURT is Plaintiffs Randolph Peterson and Tri-City
Railroad Company, LLC's Motion for Partial Summary
Judgment Against the City of Richland (ECF No. 87), Motion to
Strike (ECF No. 104), and Motion to Expedite (ECF No. 105).
These matters were submitted for consideration without a
request for oral argument. Defendants the City of Richland
and the Port of Benton filed a Response. The Court has
reviewed the record and files herein, and is fully informed.
request to strike Defendant City of Richland's Sur-Reply
and corresponding request to expedite (ECF Nos. 104; 105) are
denied as moot, as the Court does not rely
on the complained of briefing for this Order. For the reasons
discussed below, the Motion for Partial Summary Judgment (ECF
No. 87) is denied.
pending motion for summary judgment concerns alleged
retaliation by the City of Richland against Plaintiff
Tri-City Railroad Company, LLC (“TCRY”) for
successfully petitioning the United States Surface
Transportation Board (“STB”) for relief from the
City of Richland's efforts to create an at-grade crossing
over railroad tracks leased by TCRY. As discussed more fully
below, TCRY alleges the City of Richland retaliated by
creating a “Southern Connection Options List” and
by threatening suit against the Union Pacific Railroad
(“UP”), among other things. The following
provides the context for Plaintiffs'
TCRY's leasehold interest in tracks owned by the
Port of Benton
Port of Benton (the “Port”) owns approximately 16
miles of railroad trackage, which is generally referred to as
the “Southern Connection.” ECF No. 97 at 2,
¶ 4. In 2002, TCRY began leasing the trackage from the
Port and agreed to maintain the tracks and pay monthly rent,
inter alia. ECF No. 88-3. Relevant to the pending
motion, the southern end of the track runs between Gage
Boulevard and Tapteal Drive, passing through the City of
Richland and into the City of Kennewick, a what is called the
Center Parkway crossing - initial efforts
2001, before TCRY acquired its leasehold, the City of
Kennewick and the City of Richland had already “began a
coordinated effort” to create an at-grade railroa
crossing (the “Center Parkway Extension”) over
two sets of tracks-one set owned by the Port (and
subsequently leased to TCRY) and the other owned by UP. ECF
No. 95 at 4; 98 at 2-3, ¶ 2; ECF No. 93-2 (2001
agreement between City of Kennewick and City of Richland
regarding preparation for Center Parkway crossing);
see ECF No. 93-4. The crossing was part of a plan
between the City of Kennewick and the City of Richland to
connect commercial retail centers between the two cities by
extending Center Parkway Road over the tracks, connecting
Gage Boulevard and Tapteal Drive. ECF No. 95 at 4. Because
the plans called for an at-grade crossing over the Port's
tracks, “the proposed project was hostile to the
Port's property interests” as owner and TCRY's
leasehold property interest. ECF No. 95 at 4-5.
April of 2004, the City of Kennewick, in conjunction with the
City of Richland, petitioned the Washington State Utilities
& Transportation Commission (“WUTC”) to
obtain “an at-grade crossing of Center Parkway over the
Union Pacific railroad spur west of the Richland
Junction[.]” ECF No. 89 at 3, ¶ 4. In November
2005, at UP's request, Kennewick's petition to cross
TCRY tracks at Center Parkway was consolidated with the first
petition. ECF No. 89 at 3, ¶ 5.
to the Port, “[t]he Port recognized that Richland and
Kennewick had compelling arguments that could likely support
efforts to condemn the Port's property in favor of
extending Center Parkway over the Port-owned railroad
track.” ECF No. 95 at 5; see ECF No. 88-4
(petition). As such, “[r]ather than risk losing the
ability to participate in how its interests would be
impacted, in 2006, the Port entered into a Railroad Crossing
Agreement  with Richland and Kennewick” where
“the Port agreed to grant the cities a crossing
easement over its trackage” and the cities agreed
“to obtain authority for the crossing from the
Port's lessee, TCRY, or to obtain legal authority (e.g.,
authority from the court) for the proposed crossing.”
ECF No. 95 at 5-6.
2007, WUTC rejected Kennewick's . . . petitions for the
at-grade crossing over UP and TCRY tracks at Center
Parkway[.]” ECF No. 89 at 4, ¶ 7.
the course of the next few years, the City of Richland
continued to pursue its goal of securing the Center Parkway
crossing. See ECF No. 89 at 4-8, ¶¶ 8-25.
In particular, the City of Richland entered into a Standard
Form Railroad Track Use Agreement (“SFRTUA”) with
UP in April of 2011. ECF No. 89 at 7, ¶ 15. The
agreement included the declaration that “the City
desires that all railroad interchange operations at Richland
Junction be permanently eliminated[.]” ECF No. 89 at 5,
¶ 16. As part of the agreement, UP agreed to
“secure all agreements necessary with Tri-City
Railroad Company, LLC . . . to permanently relocate the
UP/Tri City Railroad interchange from Richland Junction and
the path of Center Parkway.” ECF No. 89 at 7, ¶
22. UP also reserved the right “to name an agent to
handle UP rail traffic to and from industries located along
the Track” and “named TCRY as its agent to handle
UP rail traffic to and from industries located on the Horn
Rapids Rail Spur.” ECF No. 89 at 8, ¶¶ 24-25.
Second WUTC petition for crossing; TCRY's
April 8, 2013, the City of Kennewick filed another petition
with the WUTC to construct an at-grade rail crossing at
Center Parkway. ECF No. 89 at 8, ¶ 27. On May 31, 2013,
the City of Richland filed a motion to intervene with the
WUTC in support of the City of Kennewick's petition; the
motion was granted on June 4, 2013. ECF No. 89 at 8, 28. In
November, 2014, TCRY received notice of the petition. ECF No.
89 at 9, ¶ 29. The WUTC “approved the extension of
Center Parkway between Kennewick and Richland” and the
Superior Court for the County of Benton, Washington affirmed
the WUTC orders on December 9, 2014. See Tri-City R.R.
Co. v. State of Washington, Benton County Cause No.
14-2-07894-8; ECF No. 88-24 at 2.
March 19, 2015, TCRY petitioned the United States Surface
Transportation Board (STB) “for a declaratory order
seeking preemption of Kennewick and Richland's efforts at
Richland Junction to protect its railroad operations and
leasehold rights.” ECF No. 89 at 9, ¶ 30 (emphasis
May 7, 2015, Kennewick and Richland filed a petition for
condemnation with the Benton County Superior Court for an
easement across TCRY tracks at Richland Junction for an
at-grade-crossing.” ECF No. 89 at 9, ¶ 31.
September 12, 2016, the STB issued a declaratory order
preempting Kennewick and Richland's attempt at
condemnation and denying the City of Richland's request
for an at-grade crossing[;] Richland subsequently appealed
the STB declaratory order to the Ninth Circuit Court of
Appeals.” ECF No. 89 at 10, ¶ 33.
Southern Connection Options List
assert the City of Richland, through the firm Fletcher &
Sippel, create the so-called “Southern Connection
Options List” out of retaliation for TCRY petitioning
the STB. The Port paints a much different picture-according
to the Port, the Port hired the firm Fletcher & Sippel to
create the Options List and City of Richland played no part
in its formation. ECF No. 95 at 9-10. The Port further
asserts the Options List had nothing to do with the Center
Parkway project, and provides an explanation as to the origin
and purpose of the Options List, as detailed below.
to the Port, the Horn Rapids Industrial Park-an industrial
area located at the opposite end of the Southern Connection
from the Richland Junction (approximately 12 miles
away)-began seeing economic growth in 2012. ECF No. 95 at 8.
Due to the expected increase in rail traffic, the Port hired
a railroad consulting firm, Tangent Services, Inc., to advise
the Port on how to best utilize its railroad assets to
support economic development. ECF No. 95 at 8.
this time, the Port “began questioning whether TCRY was
meeting its lease obligations and properly maintaining the
Port's trackage” and these “concerns were
compounded by the fact that TCRY refused to provide the Port
with any maintenance records” while “representing
that it was not required to maintain the track at any
specific Federal Railroad Administration standard, which the
Port disputed.” ECF No. 95 at 9. “The Port
decided to consult with an attorney who focused on railroad
law to advise the Port on the terms of the lease, including
TCRY's maintenance obligations” and “[a]s the
Port's concerns about TCRY grew, in early 2016, the ...