972 F.3d 83
D.C. Cir.2020Background
- Kansas City Southern’s U.S. railroads (Kansas City Railway and Texas‑Mexican) proposed that crews employed by affiliated Mexican carrier Kansas City Southern de México operate a 9.2‑mile U.S. segment (Laredo bridge → Laredo Yard) to reduce bridge delays.
- FRA regulations require each U.S. railroad to have FRA‑approved Part 240 (engineer) and Part 242 (conductor) certification programs; FRA uses a passive approval process: silence for 30 days (Part 240) means deemed approval, but FRA issues no formal approval document or routine public notice.
- Kansas City Railway submitted a revised Part 240 engineer program (to certify de México engineers via an accelerated curriculum); FRA took no written rejection within 30 days, so the program was passively approved and implemented in July 2018; de México crews began operating in the U.S. under Kansas City Railway certificates.
- The Unions sued under the Hobbs Act challenging FRA’s asserted authorization to allow de México crews to operate in the U.S.; they sought review of FRA’s approval of the modified Part 240 program and other asserted FRA actions/inactions.
- The D.C. Circuit held it has jurisdiction to review FRA’s passive approval of the modified Part 240 program and found the Unions’ petition timely under the Hobbs Act despite FRA’s failure to publish notice; the court vacated and remanded the Part 240 approval as arbitrary and capricious for lack of reasoned explanation.
- The court dismissed the Unions’ remaining claims (conductor certification, brake‑test waiver, other alleged waivers or enforcement failures) for lack of jurisdiction because the record contains no final, reviewable FRA action on those points.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Finality: Was FRA’s passive non‑response to the Part 240 submission a final, reviewable agency action? | FRA’s tacit approval is a final action that changed legal rights and is reviewable. | FRA agreed the passive approval is final. | Held: Yes; passive approval consummated agency decision and had legal consequences. |
| Timeliness / Notice: Did the 60‑day Hobbs Act filing period run from administrative entry (Feb 2018) or from public notice/rollout (July 2018)? | Unions: filing was timely measured from public rollout when FRA’s involvement became known. | FRA: filing was untimely because the 60‑day window began at entry in Feb 2018. | Held: Petition timely; because FRA failed to promptly publish/serve notice, Public Citizen fair‑notice principle controlled and filing within 60 days of public rollout was timely. |
| Jurisdiction over conductor certifications, brake‑test waiver, and other alleged waivers/inaction | Unions: FRA permitted/authorized conductor certification and waiver use and should be reviewable. | FRA: record contains no final FRA action approving conductor changes or waivers; FRA decisions to enforce (or not) are discretionary and not reviewable here. | Held: Dismissed for lack of jurisdiction—no final, reviewable FRA order in the administrative record on these points. |
| Merits of Part 240 approval: Was FRA’s approval lawful and reasonable (agency complied with statute/regulation and explained its decision)? | Unions: FRA unlawfully permitted a U.S. railroad to certify employees of an independent foreign affiliate and to use abbreviated training based on foreign experience without adequate legal basis. | FRA/KCSR: Kansas City Railway’s submitted program complies with FRA requirements; FRA reviewed and approved it. | Held: Vacated and remanded—the record contains no agency explanation or reasoning; approval was arbitrary and capricious under the APA; FRA must explain or re‑decide. |
| Effect of FRA’s failure to publish notice on jurisdiction | Unions: FRA’s failure to publish/service notice does not bar review; petition should be measured from reasonable notice. | FRA/dissent: agency’s lack of prompt service means the 60‑day statutory window ran from entry and petition is untimely. | Held: Agency’s failure to publish is not a jurisdictional bar; court applied fair‑notice doctrine and refused to let FRA evade review by secrecy. |
Key Cases Cited
- Bennett v. Spear, 520 U.S. 154 (1997) (final‑agency‑action test requires consummation of decisionmaking and legal consequences).
- Public Citizen v. Nuclear Regulatory Comm’n, 901 F.2d 147 (D.C. Cir. 1990) (agency must promptly give notice of Hobbs Act orders; mere placement in files is insufficient to start review clock).
- Energy Probe v. Nuclear Regulatory Comm’n, 872 F.2d 436 (D.C. Cir. 1989) (entry/serving rules govern commencement of Hobbs Act filing period).
- Blue Ridge Envtl. Defense League v. Nuclear Regulatory Comm’n, 668 F.3d 747 (D.C. Cir. 2012) (finality analysis under Hobbs Act mirrors APA principles).
- Regents of Univ. of Cal. v. Department of Homeland Sec., 140 S. Ct. 1891 (2020) (agencies must provide reasoned explanations; courts review under the APA).
- California Communities Against Toxics v. EPA, 934 F.3d 627 (D.C. Cir. 2019) (agency inaction can be final when it’s the agency’s "last word").