J. MICHELLE CHILDS, District Judge.
Plaintiffs filed these actions, currently consolidated for pretrial purposes, seeking monetary compensation from Defendants South Carolina Electric and Gas Company ("SCE&G"), The County of Lexington, SC ("Lexington County"), and CSX Transportation, Inc. ("CSX") for the damage caused to their homes by flood water released from Lake Murray Reservoir in October 2015.
This matter is before the court by way of CSX's Motions for Summary Judgment pursuant to Rule 56 of the Federal Rules of Civil Procedure. (3:15-cv-04660-JMC, ECF No. 165; 3:15-cv-04694-JMC, ECF No. 149; 3:15-cv-04695-JMC, ECF No. 148; 3:15-cv-04877-JMC, ECF No. 148; 3:15-cv-04887-JMC, ECF No. 149; 3:15-cv-04888-JMC, ECF No. 147; 3:15-cv-04892-JMC, ECF No. 148; 3:15-cv-04893-JMC, ECF No. 147; 3:15-cv-04894-JMC, ECF No. 147; 3:15-cv-04897-JMC, ECF No. 148; 3:15-cv-04898-JMC, ECF No. 148; 3:15-cv-04920-JMC, ECF No. 150; 3:15-cv-04922-JMC, ECF No. 149; 3:16-cv-01141-JMC, ECF No. 143; 3:16-cv-01143-JMC, ECF No. 143.
Plaintiffs own homes in the Coldstream neighborhood located "on the edge of Lexington County[, South Carolina], between Old Bush River Road, Coldstream Drive, and Nursery Road." Coldstream Neighborhood, https://coldstreamhoa.org (last visited July 18, 2019). "SCE&G is a regulated public utility engaged in the generation, transmission, distribution and sale of electricity to . . . customers in South Carolina." SCE&G, https://www.sceg.com/about-us/newsroom/2018 /05/09/sce-g-replaces-more-than-40-percent-of-its-nuclear-project-capacity-with-purchase-of natural-gas-fired-power-plant (last visited July 1, 2019). "CSX[] is one of the largest rail transportation companies in the United States," providing "common carrier rail transportation services across a rail network consisting of approximately 21,000 railroad route miles." (ECF No. 165-1 at 9 ¶ 3.) And, Lexington County is a county located in South Carolina that is comprised of "a total area of 758 square miles (1,960 km), of which 699 square miles (1,810 km) is land and 59 square miles (150 km2) (7.8%) is water." Lexington County, https://en.wikipedia.org/wiki /Lexington_ County,_South_Carolina (last visited July 18, 2019) (citing 2010 Census Gazetteer Files, https://www2.census.gov/geo/docs/maps-data/data/gazetteer/counties_list_45.txt (last visited July 26, 2019). "The largest body of water [in Lexington County] is Lake Murray, while other waterways include Broad River, Saluda River and Congaree River." Id.
SCE&G operates the federally licensed Saluda Hydroelectric Project P-516 ("Saluda Hydro Project" or "Project") "located on the Saluda River in Richland, Lexington, Saluda, and Newberry Counties of South Carolina, approximately 10 miles west of the city of Columbia, and near the towns of Irmo, Lexington, and Chapin."
SCE&G operates the Saluda Dam "primarily for hydroelectric power production as its Saluda Hydro facility, but outflow and storage can also be controlled by way of [the] six [T]ainter gates during flood events." (3:15-cv-04660-JMC, ECF No. 190-2 at 5.) "When inflow during major floods requires temporary storage above maximum operating pool level, releases are made through spillway gates to augment discharges through power turbines in order to lower the reservoir to required maximum pool level as soon as possible." (3:15-cv-04660-JMC, ECF No. 190-2 at 5.) "During this operation, spillway gates are opened gradually until the lake level begins to recede." (Id.) "As long as the reservoir level continues to rise[,] gate openings will be increased until all six spillway gates are wide open." (Id.)
"From October 1st through 5th, 2015, a combination of coincident atmospheric conditions, in combination with a plume of tropical moisture associated with Hurricane Joaquin, resulted in record rainfall over portions of South Carolina." (3:15-cv-04660-JMC, ECF No. 190-2 at 4.) Plaintiffs, as residents of Coldstream neighborhood along Rawls Creek,
Because they believed damage to their real and personal property occurred as a result of SCE&G's failure to properly manage water levels at the Lake Murray Dam, Plaintiffs filed Complaints in the Lexington County Court of Common Pleas on November 10 and 12, 2015, alleging claims against SCE&G for negligence, trespass, strict liability, and inverse condemnation pursuant to South Carolina's eminent domain laws. (3:15-cv-04660-JMC, ECF No. 1-1.) On December 10 and 11, 2015, SCE&G filed Notices of Removal, removing Plaintiffs' actions to this court pursuant to 28 U.S.C. §§ 1331, 1367, 1441 & 1446, and provisions of the Federal Power Act, 16 U.S.C. §§ 791-828c.
After the parties litigated the court's jurisdiction over the matter and conducted discovery, Plaintiffs filed Amended Complaints on October 4, 2017, and Second Amended Complaints on January 16, 2019, asserting individual claims of negligence, Fifth Amendment inverse condemnation, trespass, strict liability, and nuisance against SCE&G, CSX, and Lexington County for their perceived roles in the destruction of Plaintiffs' homes.
The court heard argument from the parties on CSX's Motions at a hearing on June 17, 2019. (3:15-cv-04660-JMC, ECF No. 198.) The court considers the merits of CSX's Motions for Summary Judgment below.
The court has original jurisdiction over this matter under 28 U.S.C. § 1331 pursuant to Plaintiffs' claims for inverse condemnation against CSX under the Takings Clause of the Fifth Amendment to the United States Constitution. (See 3:15-cv-04660-JMC, ECF No. 132 at 9 ¶ 61 ("The unlawful seizure of Plaintiffs' property by Defendant CSX violates the Fifth Amendment of the United States Constitution.").) The court may properly hear Plaintiffs' state law claims for negligence, trespass, strict liability, and nuisance against CSX based on supplemental jurisdiction since these claims "are so related to claims in the action within such original jurisdiction that they form part of the same case or controversy . . . ."
Summary judgment should be granted "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." Fed. R. Civ. P. 56(a). A fact is "material" if proof of its existence or non-existence would affect the disposition of the case under the applicable law. Anderson v. Liberty Lobby, Inc., 477 U.S. 242, 248-49 (1986). A genuine question of material fact exists where, after reviewing the record as a whole, the court finds that a reasonable jury could return a verdict for the non-moving party. Newport News Holdings Corp. v. Virtual City Vision, 650 F.3d 423, 434 (4th Cir. 2011).
In ruling on a motion for summary judgment, a court must view the evidence in the light most favorable to the non-moving party. Perini Corp. v. Perini Constr., Inc., 915 F.2d 121, 123-24 (4th Cir. 1990). The non-moving party may not oppose a motion for summary judgment with mere allegations or denials of the movant's pleading, but instead must "set forth specific facts" demonstrating a genuine issue for trial. Fed. R. Civ. P. 56(e); see Celotex Corp. v. Catrett, 477 U.S. 317, 324 (1986); Anderson, 477 U.S. at 252; Shealy v. Winston, 929 F.2d 1009, 1012 (4th Cir. 1991). All that is required is that "sufficient evidence supporting the claimed factual dispute be shown to require a jury or judge to resolve the parties' differing versions of the truth at trial." Anderson, 477 U.S. at 249. "Mere unsupported speculation . . . is not enough to defeat a summary judgment motion." Ennis v. Nat'l Ass'n of Bus. & Educ. Radio, Inc., 53 F.3d 55, 62 (4th Cir. 1995).
In light of the foregoing authorities, the court considers each of Plaintiffs' claims relevant to CSX's Motion for Summary Judgment in turn below.
CSX argues that it is entitled to summary judgment because "Plaintiffs' South Carolina tort law . . . claims impermissibly seek to regulate CSX[]'s railroad operations and thus are expressly preempted by Section 10501(b) of [the Interstate Commerce Commission Termination Act ("ICCTA") of 1995, 49 U.S.C. § 10101-16106]." (3:15-cv-04660-JMC, ECF No. 165 at 13.) In support of this argument, CSX asserts that the ICCTA both created the Surface Transportation Board ("STB") and granted the STB exclusive jurisdiction over the following:
(3:15-cv-04660-JMC, ECF No. 165 at 13-14 (citing 49 U.S.C. § 1302) (quoting 49 U.S.C. § 10501(b)).) CSX asserts that "the remedies provided under [[the] ICCTA] with respect to regulation of rail transportation are exclusive and preempt the remedies provided under Federal or State law." (3:15-cv-04660-JMC, ECF No. 165 at 14 (quoting 49 U.S.C. § 10501(b)).) CSX further asserts that its "rail infrastructure, including the Culverts and embankment, fall directly within ICCTA's preemptive scope over `transportation by rail carriers' and the `construction' or `operation' of railroad tracks or facilities." (3:15-cv-04660-JMC, ECF No. 165 at 15 (citing 49 U.S.C. § 10501(b)(1) and (2)).) Based on the foregoing, CSX contends that because Plaintiffs' claims all allege the "failure to redesign and/or increase the size of the Culverts and embankment," the causes of action are preempted because they "impermissibly target rail `transportation.'" (Id. at 16.)
Plaintiffs oppose CSX's Motion asserting that their claims "are not preempted by § 10501(b) of [the] ICCTA." (3:15-cv-04660-JMC, ECF No. 190 at 3.) More specifically, Plaintiffs assert that their claims for negligence, nuisance, trespass, and strict liability neither "seek[] to regulate railroad transportation" nor have the "intent to `manage' or `govern' the conventions of railroad transportation." (Id. at 4 (citing Haley v. CSX Transp., Inc., No. 3:15-cv-5037-TLW, 2016 WL 11530255, at *2 (D.S.C. Oct. 26, 2016) ("[C]ongress narrowly tailored the ICCTA pre-emption provision to displace only `regulation,' i.e., those state laws that may reasonably be said to have the effect of `managing' or `governing' rail transportation, while permitting the continued application of laws having a more remote or incidental effect on rail transportation.")).) Plaintiffs further assert that their "claims directly relate to public health and safety," which are a class of claims that neither are preempted by the ICCTA nor impede a railroad's operating abilities. (3:15cv-04660-JMC, ECF No. 190 at 4.) Lastly, Plaintiffs assert that the question of whether a tort claim should be preempted because it "unreasonably interfere[s] with rail transportation" is a jury question and not for the court to decide on summary judgment. (Id. at 5-6 (citing PCS Phosphate Co. v. Norfolk S. Corp., 559 F.3d 212, 220-21 (4th Cir. 2009)).) Therefore, in accordance with the foregoing, Plaintiffs request that the court "deny summary judgment on the issue of preemption." (Id. at 6.)
"Preemption
"Congress established the Interstate Commerce Commission ["ICC"] in 1890, giving it broad authority to regulate many facets of the railroad industry, a major component of the nation's interstate transportation network." Iowa, Chi. & E. R.R. Corp. v. Wash. Cty., Iowa, 384 F.3d 557, 558 (8th Cir. 2004). "Ninety years later, to reverse the industry's severe decline, Congress in the Staggers Act of 1980 significantly reduced the ICC's regulatory authority." Id. "In 1995, convinced that even greater deregulation was needed, Congress enacted ICCTA, terminating the ICC altogether," replacing it with the STB, "a quasi-independent three-member body within the Department of Transportation." Id. at 558-59 (citing 49 U.S.C. §§ 701-703). In enacting the ICCTA, Congress granted the STB exclusive jurisdiction over —
49 U.S.C. § 10501(b).
The ICCTA contains an express preemption provision providing that "[e]xcept as otherwise provided in this part, the remedies provided under this part with respect to regulation of rail transportation
"Though the ICCTA's preemption language is broad, the [United States Court of Appeals for the] Fourth Circuit has noted that `Congress narrowly tailored the ICCTA preemption provision to displace only `regulation,' i.e. those state laws that may reasonably be said to have the effect of `managing' or `governing' rail transportation, while permitting the continued application of laws having a more remote or incidental effect on rail transportation.'" Home & Indus. Mech. Supplies, Inc. v. CSX Transp., Inc., C/A No. 4:19-cv-00931-RBH, 2019 WL 3288618, at *2 (D.S.C. July 22, 2019) (quoting PCS Phosphate Co., Inc., 559 F.3d at 218). See also Delaware v. STB, 859 F.3d 16, 19 (D.C. Cir. 2017) ("[S]tates retain certain traditional police powers over public health and safety concerns, . . ." but "state or local statutes or regulations are preempted categorically if they `have the effect of `managing' or `governing' rail transportation.'" (quoting Fla. E. Coast Ry. Co. v. City of W. Palm Beach, 266 F.3d 1324, 1331 (11th Cir. 2001))). "A state law tort claim seeking damages . . . constitutes a `regulation,'" and "may be preempted by the ICCTA" even if it "does not seem regulatory on its face." Waubay Lake Farmers Ass'n v. BNSF Ry. Co., Civ. No. 12-4179-RAL, 2014 WL 4287086, at *5 (D.S.D. Aug. 28, 2014) (citing Kurns v. R.R. Friction Prods. Corp., 565 U.S. 625, 636 (2012)). "While the ICCTA's express preemption clause focuses on `regulation,' the Fourth Circuit has recognized that a claim may be impliedly preempted if it `unreasonably interfere[s] with rail transportation.'" Home & Indus. Mech. Supplies, Inc., 2019 WL 3288618, at *2 (quoting PCS Phosphate Co., Inc., 559 F.3d at 220-21) (internal quotation marks omitted).
"CSX[] is one of the largest rail transportation companies in the United States." (3:15-cv-04660-JMC, ECF No. 165-1 at 9 ¶ 3.) "CSX[] provides common carrier rail transportation services across a rail network consisting of approximately 21,000 railroad route miles linking communities and commercial markets in 23 states . . . ." (Id.) "Across its Rail Network, CSX[] owns and maintains approximately 10,000 bridges and 40,000 culverts." (Id. ¶ 6.) "The CSX[] Rail Network includes the approximately 3.7 mile track in Irmo, Lexington County, South Carolina at issue . . .." (Id. ¶ 7.) "The two culverts at issue are currently located at CSX[] railroad milepost SEC 1.64 (which was previously designated as railroad milepost C8.75). . . ." (Id. at 10 ¶ 8.) "The Culverts were constructed through [] [an] embankment to allow drainage from Rawls Creek to flow underneath the railroad right-of-way to prevent overtopping." (Id. at 10-11 ¶ 11.) "Each Culvert consists of a corrugated metal pipe with an approximately 12-foot diameter that runs through the entire width of the embankment underneath the Rail Line." (3:15-cv-04660-JMC, ECF No. 165-1 at 10-11 ¶ 11.)
In their Second Amended Complaints, Plaintiffs seek damages for negligence
Additionally, in support of their claims, Plaintiffs submitted expert opinions that expressly concluded:
Upon its review, the court is persuaded that the allegations in Plaintiffs' Amended Complaints, when supplemented by the opinions of their experts, compel a finding that Plaintiffs' claims for negligence, trespass, strict liability, and nuisance are preempted under the ICCTA. To remedy the deficiencies in the culverts and resultant drainage system alleged by Plaintiffs, it appears uncontroverted that CSX would have to divert significant financial and other resources from its "current and anticipated railroad engineering, operations and rail transportation needs." (3:15-cv-04660-JMC, ECF No. 165-1 at 12 ¶ 17.) More specifically, CSX "estimates that replacing the [c]ulverts with a span bridge as suggested" by Plaintiffs' expert "would cost at least $7.5 million based on a typical cost of $15,000 per linear foot to construct a railroad span bridge." (Id. at 13.) Because it is CSX's construction and operation of culverts and resultant drainage system in this case which give rise to Plaintiffs' state law causes of action, the claims are exactly the type of attempt at managing and/or governing of railroad operations that is expressly preempted by the ICCTA.
In reaching this conclusion, the court found particularly enlightening the following observations from the district court in Waubay Lake Farmers Ass'n, a case in which plaintiffs had alleged deficiencies in a railroad's culverts and resultant water drainage system:
2014 WL 4287086, at *6.
In opposing application of preemption under the ICCTA, Plaintiffs mainly rely on two (2) cases: Haley and PCS Phosphate Co. Haley is distinguishable because the court was addressing "ICCTA preemption at the Rule 12 stage," as opposed to the instant actions' summary judgment posture. Haley, 2016 WL 11530255, at *3. As to PCS Phosphate Co., the Fourth Circuit reviewed preemption under the ICCTA in the context of a breach of contract/breach of easement covenant claims and not as to state tort claims. See, e.g., PCS Phosphate Co., 559 F.3d at 218. In this regard, the Fourth Circuit concluded that contracts were not "presumptively regulatory" as required to implicate the ICCTA. PCS Phosphate Co., 559 F.3d at 220 (additionally observing that "[t]he STB itself has emphasized that courts, not the STB, are the proper forum for contract disputes, even when those contracts cover subjects that seem to fit within the definition of `rail transportation" (citations omitted)). Moreover, while it has not addressed the specific tort claims at issue in this matter, the Fourth Circuit further acknowledged that other "courts have held that common law regulation through negligence and nuisance actions was preempted by the ICCTA." PCS Phosphate Co., 559 F.3d at 220 (citing Friberg v. Kan. City S. Ry. Co., 267 F.3d 439, 444 (5th Cir. 2001)).
In these matters, Plaintiffs seek to use state tort claims to regulate the manner in which CSX constructs and operates its culverts and resultant drainage system, which in turn would result in an economic impact on CSX. Therefore, Plaintiffs' state law claims against CSX stemming from the failure "to properly design, construct, maintain, monitor, operate, warn, and/or otherwise safely manage" its culverts and resultant drainage system are preempted by the ICCTA.
For the foregoing reasons, the court hereby
49 U.S.C. § 10102(9) (emphasis added).