817 F.3d 1081
8th Cir.2016Background
- Plaintiffs are ranchers in South Dakota whose properties underlie and border an 1875 Act railroad right-of-way originally granted to Grand Island & Wyoming Central; Burlington Northern (BN) later acquired the easement and ceased operations in 1986.
- BN applied for abandonment relief from the ICC/STB in 1987; the STB revoked an abandonment exemption and authorized interim trail use (rail-banking) under the Trails Act; BN quitclaimed its interest to the State of South Dakota in 1989, and the corridor became part of a public trail in 1998.
- Plaintiffs sued the State and its Game, Fish & Parks department in state court (removed to federal court), seeking declarations that (1) the easement was abandoned before the transfer, and (2) the State “stands in the shoes” of BN so its easement is limited to railroad uses; defendants moved to dismiss for lack of jurisdiction and failure to state a claim.
- The district court dismissed both claims for lack of subject-matter jurisdiction under the STB’s purportedly exclusive jurisdiction; plaintiffs appealed only the ‘‘stands in the shoes’’ claim.
- The Eighth Circuit held the STB does not have exclusive jurisdiction over disputes about non-rail uses that do not affect present or future railroad operations, but that plaintiffs’ ‘‘stands in the shoes’’ theory fails as a matter of federal law because the Trails Act conveys a new easement for trail use—leaving remedies such as a takings claim or other state/federal law claims.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether the court may adjudicate Plaintiffs’ claim that the STB erred and the easement was abandoned before transfer | Brandt supports that the 1875 Act created only an easement that can be abandoned, so abandonment divested BN’s interest before the transfer | STB had exclusive authority to decide abandonment; judicial review limited to STB process | Not litigated on appeal; district court correctly lacked jurisdiction over collateral attack on STB abandonment decision (plaintiffs do not appeal this ruling) |
| Whether courts lack jurisdiction over claims against interim trail users because STB’s jurisdiction is exclusive under 49 U.S.C. § 10501(b) | Plaintiffs: state/federal courts may adjudicate property-rights issues that do not affect rail operations | Defendants: STB’s exclusive jurisdiction over rail transportation precludes court adjudication of rights in the corridor | Reversed: STB’s exclusive jurisdiction is limited to rail regulatory remedies; courts may decide property disputes that do not impact current or future rail operations |
| Whether the State “stands in the shoes” of BN such that the trail operator holds only the original railroad easement (railroad uses only) | Plaintiffs: the original 1875 easement limited BN’s rights to railroad purposes, so successors cannot assert broader rights | Defendants: Trails Act conveyance (quitclaim/rail-banking) preserves authority to manage trail use; STB approval converted interest for interim trail purposes | Held for Defendants as a matter of federal law: the Trails Act conveys a new easement authorizing recreational trail use; plaintiffs’ ‘‘stands in the shoes’’ claim fails; dismissal under Rule 12(b)(6) affirmed after modification |
| Available remedies for landowners alleging injury from interim trail use | Plaintiffs: seek declaratory relief restoring fee unencumbered by trail use | Defendants: tract conveyed for trail use; property-law remedies limited | Court: plaintiffs may pursue takings claims, state/federal-law suits for unlawful trail management, or STB petitions if trail impairs restoration to rail use; declaratory relief seeking to limit the trail easement to railroad uses fails |
Key Cases Cited
- Marvin M. Brandt Revocable Trust v. United States, 134 S. Ct. 1257 (2014) (1875 Act rights-of-way are easements, extinguishable by abandonment)
- Great Northern Ry. Co. v. United States, 315 U.S. 262 (1942) (1875 Act grants only an easement; fee owner retains underlying interests)
- Preseault v. ICC, 494 U.S. 1 (1990) (Trails Act preserves rights-of-way for reactivation and permits interim trail use; STB actions can give rise to takings claims)
- Hayfield N. R.R. v. Chicago & North Western Transp. Co., 467 U.S. 622 (1984) (limits on judicial displacement of railroad regulation authority)
- Grantwood Village v. Missouri Pacific R.R., 95 F.3d 654 (8th Cir. 1996) (STB/ICC has exclusive authority to determine abandonment in conversion proceedings)
- Nebraska Trails Council v. Surface Transp. Bd., 120 F.3d 901 (8th Cir. 1997) (STB retains jurisdiction over unabandoned rights-of-way)
- PCS Phosphate Co. v. Norfolk Southern Corp., 559 F.3d 212 (4th Cir. 2009) (STB’s exclusive jurisdiction limited to rail-regulatory remedies)