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Norfolk Southern Railway Company v. Zayo Group LLC
1:21-cv-01299
E.D. Va.
Apr 21, 2022
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Background

  • Norfolk Southern (landlord) and Zayo Group LLC (tenant) dispute rent under a duct lease for underground fiber that runs alongside Norfolk Southern rail property between Manassas and Alexandria, VA.
  • The duct lease contains an arbitration clause to determine the increased rental value if the lease is extended; the parties disputed the rent due.
  • An arbitrator resolved the dispute; the Court previously found the arbitration final, binding, and enforceable and entered an order confirming the award.
  • The Court directed Norfolk Southern to identify the amount of relief sought; Norfolk Southern filed a Motion for Judgment on the Pleadings under Rule 12(c) seeking unpaid rent and a declaratory judgment that Zayo must continue payments under the lease.
  • Zayo opposed, arguing (1) the Rule 12(c) motion was procedurally improper and (2) the requested relief functioned as an injunction, requiring equitable prerequisites.
  • The Court denied those objections, held the arbitration clause binding, and ordered declaratory and monetary relief enforceable under the Federal Arbitration Act.

Issues

Issue Plaintiff's Argument Defendant's Argument Held
Procedural propriety of using Rule 12(c) to obtain judgment after arbitration confirmation Motion under 12(c) properly identifies amount and is analogous to confirming arbitration award 12(c) is improper here Court: 12(c) filing was procedurally proper and analogous to confirming the arbitration award
Whether the requested relief is an injunction requiring equitable prerequisites Relief is declaratory and monetary under FAA §13, not an equitable injunction Relief operates as an injunction and thus needs injunction standards Court: Award is monetary/declaratory under FAA §13, not an injunction; injunction standards do not apply
Enforceability of the arbitration clause and whether defenses relitigate its validity Arbitration clause is valid, final, and binding; parties must follow lease terms Zayo's affirmative defenses and counterclaims challenge clause validity Court: Previous opinion resolved these challenges; clause remains binding and enforceable
Nature and scope of relief (past due and future payments) Seeks judgment for unpaid invoices and declaration Zayo must continue paying per lease Argues improper extension or enforcement beyond arbitration Court: Awards declaratory relief of clause validity and monetary relief for amounts owed; future payments enforceable via judgment under FAA §13

Key Cases Cited

  • Columbia v. Haley, 738 F.3d 107 (4th Cir. 2013) (Rule 12(c) evaluated under same standard as Rule 12(b)(6))
  • Edwards v. City of Goldsboro, 178 F.3d 231 (4th Cir. 1999) (same standard for Rule 12(c))
  • Portsmouth Redevelopment & Hous. Auth. v. BMI Apartment. Assocs., 847 F. Supp. 380 (E.D. Va. 1994) (future monetary payments are not an equitable injunction requiring injunction prerequisites)
  • Jaffee v. United States, 592 F.2d 712 (3d Cir. 1979) (discusses injunction preconditions)
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Case Details

Case Name: Norfolk Southern Railway Company v. Zayo Group LLC
Court Name: District Court, E.D. Virginia
Date Published: Apr 21, 2022
Citation: 1:21-cv-01299
Docket Number: 1:21-cv-01299
Court Abbreviation: E.D. Va.