Railroads Group Asks 4th Circuit to Reject Va. Broadband Law

A district court was wrong when it allowed a 2023 Virginia law that gave ISPs access rights to railroad properties, the Association of American Railroads (AAR) said Monday at the 4th U.S. Circuit Court of Appeals (case 24-1399). AAR is appealing a U.S. District Court for Eastern Virginia decision to dismiss the lawsuit against state officials, including Virginia State Corporation Commission Judge Jehmal Hudson for lack of standing and other reasons (see 2404170052). The contested Virginia law allows broadband providers to obtain a license to cross and occupy railroad property for a one-time $2,000 fee and direct expenses of not more than $5,000, paid to the railroad. Among other provisions, the law requires that railroad companies approve ISP applications within 35 days unless they seek relief from the Virginia commission. In an opening brief at the 4th Circuit, AAR argued that the district court wrongly ruled the association lacked standing to bring the complaint because the law was “aimed directly at its members.” The Interstate Commerce Commission Termination Act (ICCTA) preempts the Virginia law, AAR argued. The ICCTA is a 1995 statute that set exclusive federal regulation of railroad transportation, AAR said. It “preempts any state law that discriminates against or unduly burdens rail transportation, including railroad property,” AAR noted. “And a government-sanctioned physical occupation of private property is a per se taking, requiring just compensation.” The lower court “wrongly conclud[ed] that discrimination is not a standalone basis for ICCTA preemption, but a mere limit on an unwritten ‘police powers’ exception to express ICCTA preemption,” it said. Meanwhile, in concluding that the Fifth Amendment's takings clause wasn’t violated, "the court lumped together different kinds of crossings, imported (and misunderstood) facts from an amicus brief, drew inferences against AAR, and wrongly assumed that after-the-fact compensation avoids a Takings Clause violation,” AAR said. Carriers will use the state law “to cross railroad property hundreds or thousands of times,” the railroads group said, arguing for its termination. Even if one crossing were "minimally intrusive," AAR said, "dozens or hundreds of permanent and immovable crossings will aggregate to hinder railroads’ use and development of their property."