NORFOLK SOUTHERN RAILWAY COMPANY v. PITTSBURGH & WEST VIRGINIA RAILROAD
2:11-cv-01588
W.D. Pa.Apr 19, 2012Background
- This is a declaratory judgment action concerning the rights and obligations under a lease between NSR and Wheeling & Lake Erie Railway and the defendants Pittsburgh & West Virginia Railroad and Power REIT.
- P&WV is a party to the Lease as lessor; Power REIT is P&WV's parent entity and movant challenging liability boundaries.
- Plaintiffs seek declaratory relief and defendants filed a counterclaim for declaratory judgment aligned with their understanding of the Lease.
- Power REIT moved to dismiss under Rule 12(b)(6) arguing it is a separate entity and not a successor in interest to P&WV, and thus not liable.
- Plaintiffs contended Power REIT is a necessary party under Fed. R. Civ. P. 19(a)(1) and that relief against Power REIT is proper where it is Power REIT's sole asset.
- Court applied notice-pleading standard (Rule 8) and plausibility standard (Twombly/Iqbal) to evaluate the motion to dismiss.
Issues
| Issue | Plaintiff's Argument | Defendant's Argument | Held |
|---|---|---|---|
| Whether Power REIT is a necessary party to the action. | Power REIT inclusion is necessary to avoid injustice and to address its sole asset in the Lease. | Power REIT is a separate entity and not a successor in interest to P&WV; should be dismissed. | Denied; Power REIT's partial motion to dismiss denied. |
| Whether plaintiffs have stated a plausible claim for declaratory relief against Power REIT under Rule 12(b)(6). | Allegations plausibly connect Power REIT to the Lease and potential consequences for declarations sought. | No plausible link to enforce a declaration against Power REIT under the Lease. | Plaintiffs stated a plausible claim; dismissal denied. |
Key Cases Cited
- Bell Atl. Corp. v. Twombly, 550 U.S. 544 (2007) (plausibility standard for complaint sufficiency; notice pleading)
- Ashcroft v. Iqbal, 129 S. Ct. 1937 (2009) (plausibility standard; facial plausibility required)
- Conley v. Gibson, 355 U.S. 41 (1957) (rejected as overly lenient; referenced in plausibility discussion)
- Eastern Minerals & Chem. Co. v. Mahan, 225 F.3d 330 (3d Cir. 2000) (corporate veil considerations in pleadings)
- Wheeling-Pittsburgh Steel Corp. v. Intersteel, Inc., 758 F. Supp. 1054 (W.D. Pa. 1990) (piercing corporate veil; equitable relief considerations)