In the early morning hours of January 18, 2002, a Canadian Pacific freight train derailed a few miles outside of Minot, North Dakota, rupturing five tanker cars carrying anhydrous ammonia, a poisonous gas. More than 145,000 gallons of the gas leaked immediately, and another 74,000 gallons leaked from other cars over the course of the next five days – the largest release of the gas in U.S. history. The resulting cloud drifted slowly toward the city and lingered there, killing one man, and injuring hundreds others. The cause of the derailment was determined to be a broken “temporary” rail joint, meant to have been used for no more than 50 days, but left in place for nearly 22 months.

 

Residents of the town brought suit, and despite the railroad’s admission of liability, a federal judge threw the case out on grounds that the 1970 Federal Railroad Safety Act (FRSA) “preempts” state civil suits (torts). 

 

That reading of the law is both longstanding and wrong, according to CPR Member Scholars. In adopting the 1970 law, Congress thought it had settled the discussion over how federal railroad safety regulations would coexist with state law: Conflicting state laws would generally be preempted by federal regulations, but state tort law actions would not. Several subsequent federal court decisions read the law differently – finding that it preempted tort suits, with the Minot case a prominent case in point. Relying on an earlier Supreme Court decision, two federal district courts hearing the cases of people hurt in the incident ruled that FRSA preempted their claims. 

 

Congress responded by amending the statute, making it explicit that state tort actions were not preempted, even including a provision applying the law retroactively to the Minot derailment litigation.

 

The Federal Railroad Administration (FRA) nevertheless ignored Congress’ clear instructions and adopted regulations it said had “broad” preemptive effect on state tort claims, with “exceptions rare.” Showing deference to the FRA’s reading of the law, the federal courts have on many occasions also disregarded Congress by ruling that the new amendment had no real substantive effect.

 

In recent years, such assertions of preemption by federal regulatory agencies have been all too common, generally flying in the face of congressional intent. As it happens, the FRA is perhaps the perfect example of why state tort law should not be preempted by federal regulation.  Plagued by a lack of resources, and increasingly dependent upon the railroad industry to regulate itself, the FRA has proven largely ineffective at improving rail safety in recent years. Under such circumstances, state tort law has a vital role to play in spurring railroad companies to improve their safety record and of revealing the causes of railroad accidents so that appropriate steps can be taken to prevent future accidents.

 

In the latest installment of CPR’s Truth About Torts series, Regulatory Preemption at the Federal Railroad Administration, CPR Member Scholars Thomas McGarity, Sidney Shapiro, William Funk, and Nina Mendelson, and CPR Staff Jennifer Marshall and James Goodwin examine the various policy and ethical implications of regulatory preemption of state tort law claims by the FRA. Ultimately, they conclude that a complementary system of federal regulatory standards and state common law is necessary for achieving greater levels of safety for both passengers and railroad employees.