Metra wants to derail a judge's ruling that Union Pacific does not have to run Metra's commuter lines in northwest Chicago, arguing the judge committed a "manifest injustice" in refusing to consider the railroad was contractually obligated to keep operating the service.
In late September, U.S. District Judge Jorge Alonso granted a 2019 request by Union Pacific (UP) to declare it was not bound to continue providing service for Metra on the lines that run from Chicago's Ogilvie Transportation Center: The North line that runs from Chicago to Kenosha, Wis.; the Northwest line to McHenry; and the West line to Elburn. Metra owns the trains, while UP owns the rails and operates the trains, performing such functions as staffing the trains, selling tickets and collecting fares. Union Pacific said it wanted Metra to take over operating the trains.
Freight is carried by UP in 23 states, but the only commuter service it supplies is to the three Metra lines. The railroad has run the Metra lines since 1995, according to court papers.
U.S. District Judge Jorge L. Alonso
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Metra and UP had a purchase of service agreement that compensated UP for running the Metra trains. Metra contended UP has a "common carrier" obligation to keep furnishing services, even in the absence of an agreement. A common carrier obligation means, by statute, a railroad cannot turn down reasonable requests for service, whether or not it would be profitable.
Alonso ruled the law did not require UP to obtain permission to discontinue the Metra service from the U.S. Surface Transportation Board, the agency which both parties agreed has jurisdiction. Alonso explained STB permission is only required to abandon a line or cease all traffic on a line while retaining the line, neither of which applied to the dispute with Metra.
Metra also contended that in lieu of approval from the board, UP needed approval from the Illinois Commerce Commission. However, Alonso again found no statute supporting such a view. Further, the board's authority supersedes the commission, according to Alonso.
In Alonso's eyes, UP had no federal common carrier duty to run the commuter trains.
Metra tried to file a counterclaim, which wanted Alonso to declare UP was obligated to provide commuter service because of a 2017 purchase of service agreement. Metra claimed UP agreed to "use its best efforts to continue service."
Alonso refused, saying the filing was "futile," given he had already concluded no common carrier obligation existed to underpin the agreement. At any rate, Alonso stated the agreement was between the Illinois Department of Transportation and the Regional Transportation Authority, requiring Metra, not UP, to find a way to continue service on the UP lines.
On Oct. 20, Metra asked Alonso to reconsider his refusal, on grounds he "overlooked or misapplied certain key factual allegations and exhibits."
Metra is maintaining the 2017 agreement created a contractual obligation independent of any common carrier obligation and which remains in place despite having expired. Metra asserted the agreement bound UP to keep up service for the "useful life of the improvements," paid for by Metra, made to the freight and commuter services on one of the UP lines in question. Metra said it paid $45 million to UP for the improvements.
"The Court’s finding of futility without considering the merits of the 2017 Grant Agreement alleged in the counterclaim results in manifest injustice. The 2017 Grant Agreement contains a clear contractual obligation on the part of UP to provide commuter rail service," Metra asserted.
Metra added the proposed counterclaim should have been permitted, because it was also based on new evidence. The new evidence was a grant agreement inked between UP and Metra in July 2021, which contains the same requirement that UP continue commuter service.
Union Pacific is represented by the firms of Riley Safer Holmes & Cancila, of Chicago, and Shook Hardy and Bacon, which has offices in Chicago and Kansas City.
Metra is represented by Hinshaw & Culbertson, of Chicago.