A federal judge has dismissed a lawsuit that accused Union Pacific and BNSF Railway of price fixing.
Oxbow Carbon & Minerals LLC said in its lawsuit that the two biggest railroads in the western U.S. worked to avoid direct competition with each other to keep rates high, and that Union Pacific has refused to ship coal from its Oxbow’s Elk Creek Mine in western Colorado to avoid competing with BNSF.
The lawsuit brought by Oxbow and six of its companies also said the railroads’ fuel surcharges aren’t based on actual costs and simply raise shipping rates.
But U.S. District Court Judge Paul Friedman said in an opinion this week that Oxbow failed to present adequate facts to back its allegations of price fixing.
The judge said Oxbow seemed to acknowledge the railroads’ argument that Oxbow’s coal operations did not pay a uniform standard fuel surcharge but a fluctuating, coal-specific fuel surcharge. The Oxbow companies failed to include facts about each of their business operations, including which companies purchased freight transportation from the railroads or which ones claimed to have paid the surcharge, Friedman said.
He also rejected Oxbow’s claim that the railroads conspired to form a “shared monopoly,” in which the railroads agreed not to compete with each other in certain regions in order to keep shipping rates high.
Spokesman Steve Forsberg of BNSF, which is owned by Omaha’s Berkshire Hathaway, said BNSF was still studying the opinion Friday and that BNSF is “generally pleased with the judge’s decision and actions.”
Spokeswoman Raquel Espinoza of Omaha-based U.P. declined to comment.
The lawsuit was dismissed without prejudice, meaning Oxbow can refile the complaint. Oxbow spokesman Brad Goldstein said the company will refile the lawsuit, amended to reflect the judge’s concerns.