Charles Eugene HARRIS, Plaintiff-Appellee, v. NORFOLK SOUTHERN RAILWAY COMPANY, Defendant-Appellant, and Norfolk Southern Railway Corporation, Defendant, v. Cobra Natural Resources, LLC; Sperry Rail, Incorporated, d/b/a Sperry Rail Services, Third Party Defendants.
Nos. 13-1975, 13-2026
United States Court of Appeals, Fourth Circuit
Argued: Dec. 10, 2014. Decided: April 30, 2015.
784 F.3d 954
For the foregoing reasons, we grant Hernandez‘s petition for review and remand the case to the BIA for further proceedings consistent with this opinion.11
PETITION FOR REVIEW GRANTED; REMANDED FOR FURTHER PROCEEDINGS
cution and finding instead that, based on the record, “Crespin made that showing here.“).
Before TRAXLER, Chief Judge, and KEENAN and THACKER, Circuit Judges.
TRAXLER, Chief Judge:
Norfolk Southern Railway Company (“Norfolk Southern“) appeals a district court order granting summary judgment against it on the issue of liability in a negligence action brought by Charles Harris, who seeks compensation for injuries he suffered as the result of a train derailment. Harris cross-appeals the district court‘s order granting summary judgment against him on his claim for punitive damages. We affirm in part and reverse in part, and remand for further proceedings consistent with this opinion.
I.
On the morning of July 21, 2009, Harris was working on the second floor of the Black Bear Preparation Plant, a seven-story coal-loading facility (the “loadout“) in Mingo County, West Virginia. Harris‘s employer, Cobra Natural Resources (“Cobra“), owned and operated the loadout, and Norfolk Southern owned and operated the train and owned the track involved in this case. On that morning, Norfolk Southern employees backed an empty train of freight rail cars over an area of the Ben Creek Spur railroad track, which ran underneath the loadout where Harris was working. Unbeknownst to anyone, a section of the rail approximately 35 feet from the loadout was heavily corroded and contained cracks between the rail head (the ball of the rail) and the web (the vertical part of the rail). When the rail cars passed over this portion of the damaged track, a section of the rail head separated from the web and several cars derailed. One of the cars crashed into the loadout‘s support beams, precipitating the collapse of the loadout and causing Harris debilitating physical and mental injuries. An investigation into the derailment revealed that the head separation extended over nine feet of track. The summary-judgment evidence indicates that most of the separation occurred months or years before and that the derailment occurred when the final piece of webbing broke away from the rail head.
Central to this appeal are issues concerning what obligations Norfolk Southern had to inspect the track and maintain it, whether Norfolk Southern should have discovered the defect and taken action prior to the accident, and proximate cause.
Regarding the defect‘s progression, cracks going all the way through the rail had run along the length of a nine-foot section between the rail head and the web for a lengthy period of time before the derailment. An extreme level of corrosion along the break of the rail confirmed that the rail had been damaged for several years. Indeed, Norfolk Southern‘s own expert, Brett Pond, testified that of the hundreds of cracked, broken, or corroded rails he had examined in his career, this one was “the worst [he‘d] ever seen.” J.A. 1246.
Norfolk Southern‘s duty to inspect the rail arises from the Federal Rail Safety Act (“FRSA“), see
Several parts of the TSS, as they existed on the date of the accident, are relevant to this appeal. Section 213.1 of Title 49 of the Code of Federal Regulations states that the TSS
prescribe[] minimum safety requirements for railroad track that is part of the general railroad system of transportation. The requirements prescribed in this part apply to specific track conditions existing in isolation. Therefore, a combination of track conditions, none of which individually amounts to a deviation from the requirements in this part, may require remedial action to provide for safe operations over that track. This part does not restrict a railroad from adopting and enforcing additional or more stringent requirements not inconsistent with this part.
Under the TSS, different classes of track have different maximum speeds and different maintenance and inspection requirements. See
Section 213.113(a) provides specific additional requirements that apply when a track owner learns of the presence of specified defects occurring in a rail, as opposed to other parts of the track structure. In that event, a person designated under 49 C.F.R. § 213.7 must “determine whether or not the track may continue in use.”
Section 213.5(a) also provides more generally that a track owner “who knows or has notice that the track does not comply with the requirements of this part, shall” either bring the track into compliance, cease operations over the track, or operate the track under authority of a person designated under § 213.7(a) with at least one year of supervisory experience concerning railroad track maintenance, subject to specified conditions.
In this case, Norfolk Southern‘s inspectors inspected the Ben Creek Spur weekly in the months prior to the July 21, 2009, accident. During that time they discovered some defects, but they did not discover the rail defect that eventually caused the derailment. Within about 100 feet from the loadout in either direction, including where the defective rail was located, the track area was covered with coal, dirt, and debris such that only the head of the rail could be seen. The web of the rail, the ties, and the ballast were not visible, even by an inspector walking beside the track. Especially considering the extreme level of corrosion that was present on the web of the rail in the affected area for months or years prior to the accident, there is no question that without this debris, the damage to the rail would have been apparent to any inspector actually looking at the web and the complete underside of the rail head of the defective section of track.
Christopher Carney, who was serving Norfolk Southern as Division Engineer at the time of the accident, testified extensively in his deposition regarding Norfolk Southern‘s inspections. Carney testified that the inspectors inspected the Ben Creek Spur in several ways. First, they conducted on-foot inspections. They would also ride a geometry car, which railroads generally use to test the track‘s smoothness, position, curvature, and alignment, as well as the crosslevel of the two rails. See generally
Carney testified that the coal spillage on the Ben Creek loadout area “was no different than you would see at any of the other loadouts on the Norfolk Southern line” for which Carney was responsible. J.A. 2011. He stated that he was not aware of any
Carney noted that the corrosion that might be associated with a head/web separation is “[o]n the web of the rail typically” but can “also be on the bottom of the rail.” J.A. 1970. He noted that because “a head/web separation is on the underside of the rail,” “you are not going to see [it] from looking down,” although sometimes inspectors can see signs indicating that a defect exists. J.A. 1970-71.
Norfolk Southern Track Supervisor Jack Stepp testified that there would often be coal piled up on the track such that he and Assistant Track Supervisor Ricky Lee both would need to shovel it out just to get their vehicle down the track to conduct their inspections. Stepp noted that the presence of coal “makes it hard” to conduct required inspections. J.A. 1296. Lee confirmed the problem and also testified that although Cobra “did from time to time do a little bit of cleaning” of the tracks, it was “not really good enough.” J.A. 1319; see also J.A. 1326 (“[W]e couldn‘t get [Cobra] to [clean the track] very well, but they did make an attempt from time to time.“).
In addition to inspecting the track visually, Norfolk Southern contracted with Sperry Rail Services (“Sperry“) to conduct ultrasonic internal rail defect testing. Carney testified that Sperry‘s ultrasonic search for internal defects was actually a more effective way to search for such defects than inspecting the track structure visually. Norfolk Southern had Sperry test the relevant section of track in October 2006 and October 2007 and intended for Sperry to test it again in February 2009. However, unbeknownst to Norfolk Southern at the time, Sperry‘s February 2009 testing apparently did not include the relevant section.5 There is no dispute that considering the seriousness of the defect, ultrasonic testing of the relevant area should have revealed the defect.
Following the July 2009 derailment, Harris brought this lawsuit in state court against Norfolk Southern, alleging that Norfolk Southern was negligent in various respects under state law, and seeking compensatory and punitive damages. As is relevant to the current appeal, Harris claimed that Norfolk Southern negligently failed to adequately inspect and maintain its tracks.
Norfolk Southern removed the case to federal district court on the basis of diversity jurisdiction, and it subsequently asserted third-party claims against Cobra and Sperry for indemnity. Sperry in turn asserted counterclaims against Norfolk Southern and cross-claims against Cobra, which also filed cross-claims against Sperry. The claims by and against Sperry were eliminated by a partial settlement and a later partial dismissal order. Norfolk Southern subsequently filed an amended third-party complaint against Cobra, asserting indemnity under two separate agreements.
Norfolk Southern also filed an answer to Harris‘s complaint. In the answer, Norfolk Southern asserted as an affirmative defense the contention that the FRSA preempts Harris‘s claims.6 Following discovery, Norfolk Southern and Harris filed cross-motions for summary judgment.
On the merits of the track inspection and maintenance claims, Harris argued that the record established as a matter of law that because the rails on the Ben Creek Spur were constantly covered by debris, dirt, and coal, Norfolk Southern could not have conducted its inspections required by § 213.233. Harris also argued that, as a matter of law, Norfolk Southern knew or should have known that the rail was no longer in compliance with the TSS. Thus, Harris maintained, Norfolk Southern was legally obligated to undertake the measures § 213.5 prescribed.
In contrast, Norfolk Southern maintained that § 213.233 created no duty to clear the debris from its tracks in order to conduct its required inspections. It also
The district court concluded that the record established as a matter of law that Norfolk Southern violated its duty to visually inspect the track structure pursuant to
The case then proceeded to a jury trial on the issue of Harris‘s compensatory damages. After two days of testimony, the jury awarded Harris $2,977,383, which included $2,000,000 for pain and suffering and loss of enjoyment of life, $795,183 for lost earnings, $125,000 for loss of household services, and $57,200 for medical expenses. Norfolk Southern subsequently moved unsuccessfully for a new trial or alternatively a remittitur, for reasons we will discuss. See Harris v. Norfolk S. Ry., 2013 WL 896194, at *3-4 (S.D.W.Va. Mar. 8, 2013).
Norfolk Southern later resolved certain of its claims against Cobra, and the district court subsequently entered a final judgment resolving all claims pursuant to
Norfolk Southern argues that the district court erred in granting summary judgment to Harris on the issue of Norfolk Southern‘s liability for the accident. We agree.7
“We review a district court‘s decision to grant summary judgment de novo, applying the same legal standards as the district court, and viewing all facts and reasonable inferences therefrom in the light most favorable to the nonmoving party.” T-Mobile Ne. LLC v. City Council of Newport News, 674 F.3d 380, 384-85 (4th Cir. 2012) (internal quotation marks omitted). Summary judgment is appropriate “if the movant shows that there is no genuine dispute as to any material fact and the movant is entitled to judgment as a matter of law.”
A critical aspect of this appeal involves interpreting federal regulations. We normally construe regulations using the same rules we employ to construe statutes. See, e.g., Gilbert v. Residential Funding LLC, 678 F.3d 271, 276 (4th Cir. 2012). If the regulation‘s language “has a plain and ordinary meaning, courts need look no further and should apply the regulation as it is written.” Id. (internal quotation marks omitted). If a regulation is ambiguous, however, “then we look beyond the plain language, examining regulatory intent and overall [regulatory] construction.” Qwest Corp. v. Colorado Pub. Utils. Comm‘n, 656 F.3d 1093, 1099 (10th Cir. 2011) (alteration and internal quotation marks omitted). An agency‘s interpretation of a regulation it administers is accorded controlling deference so long as the interpretation is not contrary to the regulation or law that authorized the regulation. See Christopher v. SmithKline Beecham Corp., — U.S. —, 132 S.Ct. 2156, 2166, 183 L.Ed.2d 153 (2012).
The claim at issue in this appeal is Harris‘s state-law negligence, personal-injury cause of action, which requires Harris to prove the typical “four basic elements: duty, breach, causation, and damages.” Hersh v. E-T Enters., Ltd. P‘ship, 232 W.Va. 305, 752 S.E.2d 336, 341 (2013). The FRSA‘s preemption provision does not prevent a state-law action seeking damages for personal injury based on an allegation that the defendant “has failed to comply with the Federal standard of care established by a regulation or order issued by the Secretary of Transportation ... covering” laws, regulations, and orders related to railroad safety.
For the following reasons, we conclude that Harris has not established Norfolk Southern‘s liability as a matter of law under either theory. More specifically, while we agree that Harris has established that Norfolk Southern breached its duty to properly inspect the track under the TSS, a genuine issue of material fact exists as to whether Norfolk Southern‘s breach proximately caused the derailment and Harris‘s injuries.
A.
In order to evaluate Harris‘s claims that Norfolk Southern breached the duties imposed upon it by the TSS, we must first determine the scope of those duties. We begin with the duty imposed by
Under
Norfolk Southern does not dispute that the record establishes as a matter of law that the rail had been out of compliance with the TSS for months or years prior to the derailment. However, it argues that a genuine factual issue existed regarding whether it knew or had notice that the track was out of compliance with the TSS, and thus, whether its duty to address the defect under
Resolving the issue of whether a genuine factual dispute existed regarding whether Norfolk Southern “kn[e]w[] or ha[d] notice” of the defective rail requires us to also determine whether the “notice” required under
The commentary also explains that under the applicable standard, railroads may
Norfolk Southern maintains that
In response to the contention that it is ignoring the “or has notice” language in the regulation, Norfolk Southern points to a different regulation,
(a) When an owner of track learns that a rail in the track contains any of the defects listed in the table contained in paragraph (c) of this section, a person designated under § 213.7 shall determine whether the track may continue in use. If the designated person determines that the track may continue in use, operation over the defective rail is not permitted until—
(1) The rail is replaced or repaired; or
(2) The remedial action prescribed in the table contained in paragraph (c) of this section is initiated.
(b) When an owner of track learns that a rail in the track contains an indication of any of the defects listed in the table contained in paragraph (c) of this section, the track owner shall verify the indication. The track owner must verify the indication within four hours, unless the track owner has an indication of the existence of a defect that requires remedial action A, A2, or B identified in the table contained in paragraph (c) of this section, in which case the track owner must immediately verify the indication. If the indication is verified, the track owner must—
(1) Replace or repair the rail; or
(2) Initiate the remedial action prescribed in the table contained in paragraph (c) of this section.
Norfolk Southern notes that under the amended regulation a track owner‘s learning of an indication of a rail defect leads to a further specific duty on the part of the owner to verify the defect. Norfolk Southern suggests that
In sum, we conclude that the FRA‘s interpretation of
B.
With this clarification, we turn to Harris‘s contention that the district court properly held Norfolk Southern liable under
Relying on the plain meaning of the regulatory language, Harris contends that
Norfolk Southern, on the other hand, maintains that a proper vehicle-based inspection that meets the speed and other requirements of
In our view, neither Harris nor Norfolk Southern has properly described the scope of a track owner‘s inspection obligations under
While a close and critical look at the track structure is required, we cannot accept Harris‘s argument that every inch of every track must be seen in every inspection, such that every removable obstruction must always be removed. The language of
We first note that
Moreover, while the TSS clearly address the frequency with which inspections must be conducted, the number of tracks that may be inspected simultaneously, and the maximum speed for the inspector‘s vehicle when passing over track crossings and turnouts, they are completely silent regarding most other aspects of the inspection, including where the inspector must focus his attention, how much time he must spend during an inspection, and the speed he may travel over portions of the track other than track crossings and turnouts. The FRA was no doubt aware that in some situations it would not be feasible for an inspector to actually view every part of the track structure during a particular visual inspection. As Norfolk Southern points out, that would certainly be true of railroad tracks in city streets and roadways in which the track structure is covered by asphalt or concrete. Additionally, in colder areas where snow and ice might conceal portions of the track structure for long periods, the entire track would need to be cleared for every inspection.8 Accordingly, we cannot conclude that the duty to “visually inspect the track structure” obligates the track owner to visually inspect each and every part of the track structure during every inspection.9
Instead, we conclude that the duty imposed by
While Norfolk Southern does not dispute that it must exercise reasonable care when conducting the visual inspections required by
Likewise, if an obstruction on the tracks prevents an inspector from seeing what would otherwise be visible, then the exercise of reasonable care might require removal of the obstruction. If the obstruction were reasonably expected to be of a relatively short duration, as might be expected in some situations involving snow or ice, then a decision not to remove the snow and ice for a better look might be reasonable when the rail would be seen without the ice or snow during the next inspection or a short time later. In some instances a layer of light snow might obstruct a view of the rail, but cover a hundred miles of track, rendering it impractical to remove all of the snow but reasonable to leave it if one could expect it to melt a short time later. The point is that there might be practical, reasonable reasons to excuse a railroad from clearing its tracks every time, everywhere an obstruction existed.
On the other hand, allowing debris covering a portion of the track to remain undisturbed might well be unreasonable. For example, there is evidence in this case showing that the coal covering the tracks not only prevented Norfolk Southern from seeing the defects in the rail, but also contributed to the corrosion and ultimate failure of the rail, and that Norfolk Southern was aware that the presence of coal and other debris around the track could cause corrosion of the rail leading to cracks and head/web separation. See J.A. 1558 (“[T]he presence of the coal, ... based on my experience, has a significant effect on the corrosion.“); J.A. 395 (post-derailment Norfolk Southern email stating that “the track has been buried in coal for years and the metal could very well be corroded to little or nothing“). If a railroad is aware that its track is embedded in substances that cause or accelerate corrosion, relying on vehicle-based inspections alone might not be sufficient; the exercise
In either situation, the standard by which the inspector‘s decision would be judged would be whether the decision was reasonable in light of all of the circumstances. Whatever the circumstances are, an inspector must examine the rails as a reasonably prudent inspector would, having due regard for the requirements and purposes of the inspection regulation.
C.
Having defined the duties imposed on Norfolk Southern by the TSS, we next turn to the question of whether Harris established a breach of those duties as a matter of law. We conclude that he did.
The evidence is uncontested that the rail in question in the Ben Creek track was for months or even years so covered in coal and other debris that the inspectors could not see the area of the rail beneath the rail head, which otherwise would have been visible during a walking or vehicle-based inspection. See J.A. 2026 (Carney‘s testimony that if coal debris covered the tracks up to the rail head, then there could have been no visual inspection of the portion of the rail that was covered). Norfolk Southern did not clear the track of debris or at least dig out sample areas of the debris to permit it to view sections of the embedded track structure, and Norfolk Southern had not conducted any ultrasonic testing on the area in question since October 2007, more than a year-and-a-half before the July 2009 derailment. Norfolk Southern thus was largely in the dark concerning the state of the rail, left with only the hope that if the track had deteriorated, some indication could be visible in the limited visible portion of the track structure.
As we have explained, a railroad need not view every piece of the track structure during every inspection. Nonetheless, Norfolk Southern failed for a period of months and years to actually look at any of the embedded portion of the track, despite its obligation to perform weekly visual inspections of the track structure. Under these circumstances, we believe that any reasonable jury would find that Norfolk Southern breached its duty to visually inspect the track structure in accordance with
D.
Norfolk Southern argues that even if it breached its duty to inspect under
As we have already explained, under some circumstances a vehicle-based inspection will be sufficient; in such circumstances, the railroad would only be charged with the knowledge of what should have been seen from the vehicle. However, vehicle-based inspections do not always and automatically satisfy a railroad‘s obligation to visually inspect the track structure. Accordingly, the question is not whether the defect would have been
There is no dispute that the cracks in the defective section of track had existed for an extended period of time before the derailment and that there was extensive corrosion on the track. Indeed, even Norfolk Southern‘s own expert described the damage to the rail as “the worst” he had ever seen. J.A. 1246. Nonetheless, the evidence is not so one-sided that we can say as a matter of law a reasonable visual inspection would have revealed the defect.
For example, Chris Bagnall, Harris‘s metallurgy expert, testified in his deposition that the degree of corrosion and crack formation on the broken piece of rail indicated that damage requiring remediation would have been present and could have been detected in 2009 by ultrasonic testing or by walking down the track and digging out areas of the coal debris to permit inspection. Bagnall, however, did not testify that signs of the defect appeared consistently across the length of the embedded track such that they would necessarily be discovered by an inspector digging out sample areas of debris, or that signs of the defect would have been located far enough down the web of the rail that an inspector would necessarily have been able to see them even had the track been clear of debris. See J.A. 3800 (Bagnall‘s testimony that an inspector would not be expected “to see damage on the top of the rail” and that it would be difficult to see the cracking or corrosion because “it‘s underneath the head of the rail“). And while Harris also submitted a report from expert Alan Blackwell opining that Norfolk Southern would have discovered the defect had it “perform[ed] proper track inspections that included either visual detection or sounding the rail with a ball-peen hammer in the area if the track was embedded with dirt, coal and ballast,” J.A. 958, that report was unsworn. Nonetheless, even if we considered Blackwell‘s report, Norfolk Southern‘s competing evidence raises sufficient questions about these expert conclusions to preclude summary judgment.
Because of the complications posed by the location of the defect under the rail head, we conclude that a jury could reasonably find that Harris has not proven that Norfolk Southern would have discovered the defect even had it not breached its duty to conduct proper visual inspections. Accordingly, the question of whether Norfolk Southern‘s breach of its duty to conduct the inspections required by
III.
In his cross-appeal, Harris argues that the district court erred in granting summary judgment against him on his claim for punitive damages.
Although punitive damages under West Virginia law were originally “awarded only to deter malicious and mean-spirited conduct,” the standard “has grown to include ... extremely negligent conduct that is likely to cause serious harm.” TXO Prod. Corp. v. Alliance Res. Corp., 187 W.Va. 457, 419 S.E.2d 870, 887 (1992), aff‘d, 509 U.S. 443 (1993). As the standard exists today, punitive damages may be awarded where a plaintiff shows “gross fraud, malice, oppression, or wanton, willful, or reckless conduct or criminal indifference to civil obligations affecting the rights of others.” Crawford v. Snyder, 228 W.Va. 304, 719 S.E.2d 774, 783 (2011) (internal quotation marks omitted). In our view, the record does not give rise to any reasonable inference that this standard was met.
Harris argues that “the undisputed evidence shows that, prior to the July 2009 derailment here, [Norfolk Southern] had known for years that compliant visual inspections of the track where the derailment occurred were not being conducted because the track was almost completely covered with coal, dirt, and other debris” and that “[t]he broken rail had developed over a period of years before July 2009 as a result of this gross neglect.” Brief of Plaintiff-Appellee-Cross-Appellant, at 60-61. But even Harris recognizes that Norfolk Southern was hardly indifferent to the existence of rail defects of the type at issue here. In fact, Harris concedes (1) that Norfolk Southern contracted with Sperry to conduct ultrasonic internal rail defect testing at the Ben Creek Spur in 2009, (2) that had the damaged nine-foot section actually been tested, the defect would have been revealed, and (3) that it was only because Norfolk Southern inaccurately mapped the GPS coordinates of the Spur that the nine-foot section was not tested.11 See Brief of Plaintiff-Appellee-Cross-Appellant, at 10. There is no dispute that Sperry tested the rail at issue in October 2006 and October 2007 and discovered no defect in either of those years. And there is no evidence that Norfolk Southern realized that Sperry had omitted the section during its 2009 testing. Even if Harris is correct that Norfolk Southern‘s erroneous mapping was the cause of the omission,12 that is simply not the sort of extreme negligence bordering on recklessness that could serve as the basis for an award of punitive damages. We therefore hold that the district court properly granted summary judgment on Harris‘s punitive damages claim.
IV.
In sum, for the foregoing reasons, we affirm the grant of Norfolk Southern‘s motion for summary judgment on Harris‘s punitive damages claim and reverse the
AFFIRMED IN PART, REVERSED IN PART, AND REMANDED
WILLIAM B. TRAXLER, JR.
CHIEF JUDGE