The Obama administration this week began a new effort in a federal appeals court to revive the power of Amtrak — the operator of the nation’s rail passenger service — to help set and enforce rules to help make sure that its trains run on time.
Justice Department lawyers asked the U.S. Court of Appeals for the District of Columbia Circuit to assemble its full bench to reconsider Amtrak’s authority to set performance standards for the use of the railroad tracks — owned by the freight railroads, not by Amtrak. That authority was nullified last April by a three-judge panel of the Circuit Court, after the case had been sent back by the Supreme Court.
The freight lines’ trade group — the Association of American Railroads — was given until July 15 to provide its view on whether the dispute should be decided by the en banc Circuit Court. The case has the potential to go on to the Supreme Court, whether or not the Circuit Court reconsiders the panel ruling.
Fervently defending the constitutionality of the 2008 law that made Amtrak — a corporation given significant public powers — the partner of federal railroad officials in controlling the priority of use of the tracks, the rehearing petition said that the dispute involves “a question foi exceptional importance.”
The filing chided the Circuit Court panel for finding unconstitutional both Amrak’s shared role in setting track use standards and its shared role in resolving disputes over those standards. The government petition argued that the panel seriously misread a Depression-era Supreme Court ruling that struck down one major law in President Franklin Roosevelt’s economic recovery plan, the “New Deal.”
The 1936 precedent in Carter v. Carter Coal Co., if understood in the way that the Justice Department believes that it should be, stands only for the view that the government cannot pick one set of private companies in an industry and make them regulators of their competitors.
Amtrak, the filing said, is a quasi-government entity — according to the Supreme Court’s decision last year in an earlier phase of the Amtrak case — and thus has not been given an anti-competitive role of overseeing the operations of the nation’s freight railroads, on whose tracks Amtrak has a priority of use under federal law.
Before this case, the government argued, no court had applied the 1936 precedent to strike down a role that Congress assigned to a government or a quasi-government entity like Amtrak.
The freight railroads had gone to court beginning in 2011 to challenge the roles that Congress assigned to Amtrak in setting rules for the use of the track system and in resolving disputes over those rules. They initially won a victory in the Circuit Court in 2013, declaring that Amtrak was a private entity and it thus was unconstitutional for Congress to delegate government regulatory power to it.
The Supreme Court overturned that result last year, declaring that Amtrak was actually a part of the government. But, when the case returned to the Circuit Court, it again ruled that Amtrak remained enough of a private entity that Congress could not constitutionally set it up as a rules-maker for its competitors in the rail freight sector.
In arguing against that result in its rehearing petition, the Justice Department said that the Circuit Court not only was wrong in that aspect of its new decision, but also in invalidating Amtrak’s shared role in picking an arbitrator to settle disputes over the track use standards.
The power to help pick an arbitrator has never been used, the government filing said, so the Circuit Court has no basis for concluding that Amtrak would use its authority to help settle disputes to force compromise favoring itself over the freight railroads.
The D.C. Circuit has eleven active judges on its full bench. It would take the votes of at least six to grant rehearing. The vote will be taken after the freight railroads have a chance to respond.