Village of Caseyville, Illinois v. CSX Transportation, Inc.

IN THE UNITED STATES DISTRICT COURT

FOR THE SOUTHERN DISTRICT OF ILLINOIS

VILLAGE OF CASEYVILLE, ILLINOIS,

KELLER PROPERTIES, LLC, and

KELLER FARMS, INC.,

Plaintiffs,

v. Case No. 3:24-CV-02164-NJR

CSX TRANSPORTATION, INC., and

BALTIMORE & OHIO RAILROAD

COMPANY,

Defendants.

MEMORANDUM AND ORDER

ROSENSTENGEL, Chief Judge:

This case arises out of a major flooding event in Caseyville, Illinois. Plaintiffs, the

Village of Caseyville, Illinois (“Caseyville”), Keller Properties LLC, and Keller Farms, Inc.

(“Keller Properties” and “Keller Farms” respectively; collectively the “Kellers”), allege

that Defendants, CSX Transportation, Inc. (“CSX”) and Baltimore & Ohio Railroad

Company (“B&O”), caused or intensified the flooding because they improperly

maintained their property. Specifically, Plaintiffs allege that, over time, debris had built

up on Defendants’ property behind a bridge crossing over Little Canteen Creek, which

obstructed the creek’s natural flow of water. When a storm hit, water was diverted over

the banks of the creek, causing a “massive surge of water” through Caseyville that

“damage[ed] entire neighborhoods.” Compl. ¶ 1, (Doc. 1-1).

Plaintiffs filed a complaint in the Circuit Court of St. Clair County, Illinois, on July

24, 2024. The complaint asserts two counts of negligence, one on behalf of Caseyville

(Count I) and one on behalf of the Kellers (Count II). Defendants removed the case to

federal court on September 12, 2024.1 (Doc. 1). They now move to dismiss Plaintiffs’

complaint under Federal Rule of Civil Procedure 12(b)(6). (Doc. 13).

FACTUAL BACKGROUND

On the night of July 25 and into July 26, 2022, a “massive surge of water” rushed

through Caseyville. Compl. ¶ 1. Plaintiffs and residents of Caseyville suffered

“immeasurable losses” as entire neighborhoods were damaged Id. ¶¶ 1, 17.

The surge was allegedly caused by “countless gallons of water that became bottled

up” on Defendants’ property behind a railroad bridge crossing over Little Canteen Creek.

Id. ¶ 2. Water allegedly built up because debris had accumulated in the area over time,

eventually “clog[ging]” the creek’s natural flow. Id. When a storm hit on July 25, water

1 Federal subject matter jurisdiction is secure under the diversity statute, which requires opposing parties

to be “citizens of different [s]tates” and an amount in controversy exceeding $75,000 exclusive of interest

and costs. 28 U.S.C. § 1332(a). Caseyville is an Illinois municipality, and thus a citizen of Illinois. (Am. Not.

of Removal, Doc. 40, p. 2). Keller Properties is an Illinois citizen because, as a limited liability company, it

adopts the citizenship of its members—Craig Keller, Lindsey Keller-Janssen, and Lauren Eck—all of whom

are citizens of Illinois. (Id.); see also City of E. St. Louis, Ill. v. Netflix, Inc., 83 F.4th 1066, 1070 (7th Cir. 2023)

(explaining citizenship rule for limited liability companies). Keller Farms is also an Illinois citizen because

it is incorporated and has its principal place of business in Illinois. (Doc. 40, p. 2); see also 28 U.S.C.

§ 1332(c)(1). CSX is a citizen of Virginia and Florida because it is incorporated in Virginia and has its

principal place of business in Jacksonville, Florida. (Doc. 40, p. 2). B&O merged into The Chesapeake &

Ohio Railway Co. in April 1987, which then merged into CSX in September 1987. B&O thus “has no active

railroad operations and no longer exists as a distinct entity subject to legal process.” (Doc. 13 n.1). This

satisfies complete diversity because Plaintiffs are Illinois citizens and Defendants are Virginia and Florida

citizens. The amount in controversy requirement also appears to be met because Plaintiffs allege

“immeasurable losses” and seek “massive amounts of money” in damages as a result of a flood that

damaged “entire neighborhoods.” (Doc. 1-1); see also Sykes v. Cook Inc., 72 F.4th 195, 205 (7th Cir. 2023) (“The

plaintiff’s allegations about the amount in controversy control unless the court concludes, to a legal

certainty, that the face of the pleadings demonstrates that the plaintiff cannot recover the jurisdictional

minimum or that the proofs show that the plaintiff never was entitled to recover that amount.”) (internal

quotation marks omitted).

levels swelled over the banks of the creek and put stress on the creek’s levees. Id. ¶¶ 3, 15.

Eventually, the south levee failed, “creating a gap . . . the size of a greyhound bus,” which

“unleash[ed] a huge amount of water over the adjacent farmland” and into Caseyville.

Id. ¶¶ 16, 17.

The bridge on Defendants’ property is located northwest of Caseyville’s

residential neighborhoods. Id. ¶ 34. “Major flooding” allegedly reached Old Caseyville

Road, Susanne Court, Lucinda Court, 5th Street, 6th Street, 7th Street, Acordi Drive,

Countryside Drive, West Lincoln Avenue, and Black Lane. Id. ¶ 50. The flood also forced

the Caseyville Nursing and Rehabilitation Center to evacuate its residents to ensure their

safety. Id. ¶ 51. More broadly, the flood allegedly caused “widespread destruction

throughout Caseyville.” Id. ¶ 57. Caseyville was placed under a “federal state of

emergency,” which required it to “expend massive amounts of money . . . to have

emergency responders active and remediation crews address the issues to solve the

problems created by the flood.” Id. ¶ 58. The Kellers, for their part, own farmland near

Defendants’ property, where they grow and harvest crops. Id. ¶¶ 36-37. When the south

levee failed, water rushed onto the Kellers’ property “destroying all of [their] crops”

south of the levee. Id. ¶¶ 37, 71.

Defendants allegedly knew that debris could create a “makeshift dam” because it

had happened before. Id. ¶ 5. Nevertheless, Defendants failed to “fix, adjust, redesign, or

make any improvements on the land of the [b]ridge to prevent debris collection since at

least 1996.” Id. ¶ 8. Indeed, it had been 40 years since Defendants last cleaned debris

around the bridge. Id. ¶ 10. Defendants, moreover, did not communicate with Caseyville

police and first responders in advance of the storm, nor did they warn the residents of

Caseyville about the allegedly dangerous condition that existed on their property and

that could create a flood. Id. ¶¶ 11, 13.

LEGAL STANDARD

A motion to dismiss under Federal Rule of Civil Procedure 12(b)(6) “tests whether

the complaint states a claim on which relief may be granted.” Richards v. Mitcheff, 696 F.3d

635, 637 (7th Cir. 2012). The Court accepts as true the complaint’s well-pleaded factual

allegations and draws all reasonable inferences in the plaintiff’s favor. Burke v. 401 N.

Wabash Venture, LLC, 714 F.3d 501, 504 (7th Cir. 2013).

To survive a Rule 12(b)(6) motion, a plaintiff only needs to allege enough facts to

state a claim for relief that is plausible on its face. Bell Atl. Corp. v. Twombly, 550 U.S. 544,

570 (2007). “Plausibility does not mean probability: a court reviewing a 12(b)(6) motion

must ‘ask itself could these things have happened, not did they happen.’” Huri v. Off. of the

Chief Judge of the Cir. Ct. of Cook Cnty., 804 F.3d 826, 833 (7th Cir. 2015) (quoting Swanson

v. Citibank, N.A., 614 F.3d 400, 404 (7th Cir. 2010)). “A claim is plausible where a plaintiff

‘pleads factual content that allows the court to draw the reasonable inference that the

defendant is liable for the misconduct alleged.’” Bilek v. Fed. Ins. Co., 8 F.4th 581, 586 (7th

Cir. 2021) (quoting Ashcroft v. Iqbal, 556 U.S. 662, 678 (2009)). This means that the plaintiff

must offer “some specific facts to support the legal claims asserted in the complaint.” Id.

(quoting McAuley v. City of Chicago, 671 F.3d 611, 616 (7th Cir. 2011) (citation modified)).

A complaint, moreover, “need not anticipate or refute potential affirmative

defenses.” Luna Vanegas v. Signet Builders, Inc., 46 F.4th 636, 640 (7th Cir. 2022).

Affirmative defenses are thus generally resolved in a motion for judgment on the

pleadings under Rule 12(c), not in a motion to dismiss under Rule 12(b)(6). Holmes v.

Marion Cnty. Sheriff’s Off., 141 F.4th 818, 822 (7th Cir. 2025). Dismissal on the basis of an

affirmative defense under Rule 12(b)(6) is only appropriate “if the affirmative defense is

clear from the face of the complaint.” Id.; see also H.A.L. NY Holdings, L.L.C. v. Guinan,

958 F.3d 627, 631-32 (7th Cir. 2020). So, “[o]nly when the plaintiff pleads itself out of

court—that is, admits all the ingredients of an impenetrable defense—may a complaint

that otherwise states a claim be dismissed under Rule 12(b)(6).” Xechem, Inc. v. Bristol-

Myers Squibb Co., 372 F.3d 899, 901 (7th Cir. 2004). And when an affirmative defense is

raised in a motion to dismiss under Rule 12(b)(6), the defendant bears the burden of

proof. Benson v. Fannie Mae Confections Brands, Inc., 944 F.3d 639, 645 (7th Cir. 2019).

DISCUSSION

Defendants raise five arguments in support of their motion to dismiss. First, they

argue that Illinois’ municipal cost recovery rule bars Caseyville from recovering its

emergency response costs. Second, they contend that Plaintiffs’ claims are barred by the

economic loss doctrine. Defendants’ third and fourth arguments contend that Plaintiffs’

claims are preempted by the Interstate Commerce Commission Termination Act,

49 U.S.C. § 10101, et seq. (“ICCTA”), and the Federal Railroad Safety Act, 49 U.S.C.

§ 20101, et seq. (“FRSA”) respectively. And finally, they argue that Plaintiffs failed to

plead a legally cognizable duty to support their negligence claims. The Court will address

each of these arguments in turn.

1. Municipal Cost Recovery

The municipal cost recovery rule holds that “public expenditures made in the

performance of governmental functions are not recoverable in tort.” City of Chicago v.

Beretta U.S.A., Corp., 821 N.E.2d 1099, 1144 (Ill. 2004). This means that “the cost of public

services for protection from fire or safety hazards is to be borne by the public as a whole,

not assessed against the tortfeasor whose negligence creates the need for the service.” Id.

(quoting City of Flagstaff v. Atchison, Topeka & Santa Fe Ry. Co., 719 F.2d 322, 323 (9th

Cir. 1983)). The Illinois Supreme Court adopted this rule in Beretta as an outgrowth of the

separation of powers doctrine:

Governmental entities themselves currently bear the cost in question, and

they have taken no action to shift it elsewhere. If the government has chosen

to bear the cost for reasons of economic efficiency, or even as a subsidy to

the citizens and their businesses, the decision implicates fiscal policy; the

legislature and its public deliberative processes, rather than the court, is the

appropriate forum to address such fiscal concerns.

Id. at 1144-45 (quoting Flagstaff, 719 F.2d at 324 (citation modified)). The Illinois

legislature, for its part, has passed no law modifying this rule. Id. at 1147. Thus, under

Illinois law, municipal and other governmental claimants are barred from recovering the

costs they incur in responding to certain emergencies and disasters.

Defendants invoke the rule to knock out Caseyville’s claim for damages based on

its expenditure of “massive amounts of money . . . to have emergency responders active

and remediation crews address the issues to solve the problems created by the flood.” A

straightforward application of the rule shows they are correct.

The Ninth Circuit’s decision in Flagstaff—on which the Illinois Supreme Court

relied in Beretta—offers an instructive framework. There, a train carrying liquified

petroleum gas derailed near Flagstaff, Arizona, creating a public safety hazard. Flagstaff,

719 F.2d at 323. The City of Flagstaff sought to recover its costs for the “evacuation [of

affected residents], including overtime pay, emergency equipment, emergency medical

personnel,” and other remedial expenses under a negligence theory. Id. But the remedial

services at issue, the court found, were “provided by the government and the costs . . .

spread by taxes.” Id. Thus, “the tortfeasor does not expect a demand for reimbursement”

from the government even though it may be liable to private parties whose injuries it

proximately caused. Id. The court found that imposing damages on the defendant for

Flagstaff’s remedial expenditures would upset “[s]ettled expectations” that

governmental services are paid for by the government. Id. This is so because, unlike a

private party, the government “spreads the expense of emergency services to its

taxpayers, an allocation which is neither irrational nor unfair.” Id. Here, Caseyville seeks

to recover a nearly identical form of damages as Flagstaff: “money . . . to have emergency

responders active and remediation crews address the issues” caused by the flood. Under

Beretta, the Court is in no position to award damages for these expenditures because they

are covered by the municipal cost recovery rule.

Caseyville acknowledges that it cannot recover the costs associated with “taxpayer

funded services for police and fire emergency personnel conducting rescue efforts.”

Caseyville Resp. to MTD, (Doc. 31, p. 2). But in its response to Defendants’ motion to

dismiss, Caseyville shifts the damages inquiry to the “hundreds of thousands of dollars

expended by [it] when it (1) repaired and/or replaced personal property, (2) repaired

village owned real property, (3) repaired the levee owned, controlled and located on

private property, and (4) provided non-traditional services not normally provided by the

Village to residents and members of the general public.” Id. Caseyville is correct that it

may, at a minimum, recover for damage to its own property. A governmental entity, after

all, stands in the same position as any other tort plaintiff when it seeks compensation “for

harm to [its] property.” Beretta, 821 N.E.2d at 1147; see also Flagstaff, 719 F.2d at 324

(damages available “where the government incurs expenses to protect its own

property”). But if Caseyville sustained such losses, they are nowhere to be found in the

complaint.

Caseyville alleges “immeasurable losses,” “widespread destruction,” and that the

flood reached several of its streets. These allegations are too general to withstand the

municipal cost recovery rule. Indeed, the only specific allegation concerning the

destruction of property concerns property belonging to the Kellers—namely, crops that

were destroyed when the south levee failed. Perhaps in recognition of this pleading

defect, Caseyville’s response brief pivots to its expenditures to repair “village owned

property” and other items. While these types of damages may be compensable—if

properly pled—their absence from the complaint is fatal to Caseyville’s claim. “It is a

basic principle that the complaint may not be amended by the briefs in opposition to a

motion to dismiss.” Agnew v. NCAA, 683 F.3d 328, 348 (7th Cir. 2012) (alteration omitted);

see also Pirelli Armstrong Tire Corp. Retiree Med. Ben. Tr. v. Walgreen Co., 631 F.3d 436, 448

(7th Cir. 2011) (rejecting plaintiff’s attempt to “reorient[]” allegations in response to

motion to dismiss because of “the axiomatic rule that a plaintiff may not amend his

complaint in his response brief.”). Accordingly, Caseyville’s attempt to shift the inquiry

to damages that were not pled is unconvincing because the Court is not interested in

blurring the lines between the complaint and dispositive motion briefing.

The municipal cost recovery rule bars Caseyville from recovering the costs it

incurred to respond to the flood. The complaint, moreover, does not allege any “specific

facts” that support a claim for damages beyond the rule’s reach. Bilek, 8 F.4th at 586; see

also In re Chicago Flood Litig., 680 N.E.2d 265, 276 (Ill. 1997) (“The conclusory allegation of

unspecified property damage is insufficient to show that [plaintiffs’] damages are

recoverable in tort.”). Accordingly, Count I of Plaintiffs’ complaint is dismissed without

prejudice.

The Court will now consider Defendants’ remaining arguments only with respect

to Count II—the Kellers’ negligence claim.

2. Economic Loss

Defendants attack the Kellers’ negligence claim on the basis that they seek

compensation in tort for purely economic damages. Such damages, they argue, are not

recoverable under Illinois’ economic loss doctrine.

“At common law, solely economic losses are generally not recoverable in tort

actions” because “the economic consequences of any single accident are virtually

limitless.” Chicago Flood, 680 N.E.2d at 274. “[A] defendant who could be held liable for

every economic effect of its tortious conduct would face virtually uninsurable risks, far

out of proportion to its culpability.” Beretta, 821 N.E.2d at 1140. The economic loss

doctrine “operates to prevent such open-ended tort liability.” Id.

But the doctrine is subject to an important exception. It does not apply where the

plaintiff sustained “personal injury or property damage, resulting from a sudden or

dangerous occurrence.”2 Chicago Flood, 680 N.E.2d at 275 (emphasis omitted). The Illinois

Supreme Court explained the distinction between qualifying and non-qualifying

damages under the economic loss doctrine as follows:

[C]lass plaintiffs do not seek damages for the loss of continuous electrical

service, which is a disappointed commercial expectation. Rather, class

plaintiffs seek damages for property loss, in the form of lost perishable

inventory, as a result of a tortious event. Such damages are above and

beyond class plaintiffs’ disappointed commercial expectation in continuous

electrical service. Thus, these losses fall outside the definition of economic

loss and are recoverable in tort.

Id. at 276 (internal citation omitted).

Here, Defendants focus on the allegations that “entire neighborhoods” were

damaged, and that Plaintiffs spent “massive amounts of money” to respond to the flood.

(Doc. 14, p. 6). These generalized allegations, they argue, are purely economic in nature,

and thus subject to the economic loss doctrine.

The Court disagrees. Defendants’ argument cherry-picks only certain allegations

in the complaint while ignoring those most relevant to the issue of whether the Kellers

have alleged cognizable damages to support their negligence claim. The Kellers allege

that their crops were destroyed by the flood. The flood, moreover, was a “sudden,

dangerous, or calamitous” event, as laid out in the complaint. Under Chicago Flood, these

2 The Illinois Supreme Court also recognizes two other exceptions to the economic loss doctrine that are

not relevant here: “where the plaintiff’s damages are proximately caused by a defendant’s intentional, false

representation, i.e., fraud;” and “where the plaintiff’s damages are proximately caused by a negligent

misrepresentation by a defendant in the business of supplying information for the guidance of others in

their business transactions.” Chicago Flood, 680 N.E.2d at 275 (internal citations omitted).

damages escape the economic loss doctrine. Indeed, Chicago Flood held that “lost

perishable inventory” was not subject to the doctrine when a flood caused the loss. Id.

Logically, then, the same applies to crops that were destroyed in the same manner.

Defendants also contend that the Kellers have not explained which of their losses

are attributable to Keller Properties and which were sustained by Keller Farms. This

argument too, is unconvincing because the complaint refers to the Kellers collectively and

alleges that they suffered “the destruction of all of [their] crops” south of the south levee.3

Compl. ¶¶ 18, 71. An indulgent review of the complaint, to which the Kellers are entitled,

permits an inference that Keller Properties and Keller Farms both had an interest in the

crops that were destroyed. The exact measure of their damages is an appropriate topic

for discovery. See e.g., Bolden-Gardner v. Liberty Mut. Ins. Co., No. 19-3199, 2021 WL 22419,

at *4 (D. Md. Jan. 4, 2021) (denying dispositive motion as premature where “there remains

a dispute as to the nature and extent of the Plaintiffs’ injuries, and by extension the value

of their claimed damages.”). Accordingly, Illinois’ economic loss doctrine does not justify

dismissal at this stage of the case.

3. Federal Preemption

Defendants next argue that the Kellers’ negligence claim is preempted by federal

law. They invoke the ICCTA and FRSA as federal statutes that broadly govern railroad

transportation and thus leave no room for state regulation, including through tort

3 The complaint refers to the Kellers as a single entity and thus alleges in paragraph 71 that “Keller” suffered

“the destruction of all of its crops.” This linguistic preference does not change the fact that the complaint

names Keller Properties and Keller Farms (two separate legal entities) as Plaintiffs. The Court thus refers

to them as the “Kellers” to convey their distinct legal personalities.

litigation. Federal preemption “is an affirmative defense upon which the defendants bear

the burden of proof.” Benson, 944 F.3d at 645 (internal quotation marks omitted).

a. ICCTA Preemption

The ICCTA is a modern example of Congress’s “broad regulatory authority over

rail transportation.” Island Park, LLC v. CSX Transp., 559 F.3d 96, 102 (2d Cir. 2009).

Congress enacted the ICCTA in 1995 and created the Surface Transportation Board

(“STB” or “Board”) to administer it. Union Pac. R.R. Co. v. Chicago Transit Auth., 647 F.3d

675, 678 (7th Cir. 2011) (“CTA”). “The STB is vested with broad jurisdiction over

‘transportation by rail carriers.’” Island Park, 559 F.3d at 102 (quoting 49 U.S.C.

§ 10501(b)(1)). Congress gave the STB this broad regulatory mandate because it

recognized that state regulation of rail transport risked the “balkanization and subversion

of the Federal scheme of minimal regulation for this intrinsically interstate form of

transportation.” Iowa, Chicago & E. R.R. Corp. v. Wash. Cnty., Iowa, 384 F.3d 557, 559 (8th

Cir. 2004) (quoting H.R. REP. NO. 104-311, at 96 (1995)). And to help the STB execute its

mandate, the ICCTA includes the following express preemption provision:

The jurisdiction of the Board over--

(1) transportation by rail carriers, and the remedies provided in

this part with respect to rates, classifications, rules (including

car service, interchange, and other operating rules), practices,

routes, services, and facilities of such carriers; and

(2) the construction, acquisition, operation, abandonment, or

discontinuance of spur, industrial, team, switching, or side

tracks, or facilities, even if the tracks are located, or intended

to be located, entirely in one State,

is exclusive. Except as otherwise provided in this part, the remedies

provided under this part with respect to regulation of rail transportation

are exclusive and preempt the remedies provided under Federal or State

law.

49 U.S.C. § 10501(b). “Congress’s intent in the [ICCTA] to preempt state and local

regulation of railroad transportation has been recognized as broad and sweeping.”

CTA, 647 F.3d at 678.

There are two forms of preemption under the ICCTA: (i) categorical preemption;

and (ii) as applied preemption. Id. at 679. “Categorical preemption occurs when a state

action is preempted on its face despite its context or rationale, such as when state

preclearance could be used to deny a railroad the ability to conduct some part of its

operations, or when a state regulates matters directly regulated by the STB (e.g., the

construction, operation, and abandonment of rail lines).” Wedemeyer v. CSX Transp., Inc.,

850 F.3d 889, 894-95 (7th Cir. 2017) (citation modified). As applied preemption, on the

other hand, depends on “the degree of interference that [the state action] has on railroad

transportation—that is, if the action would have the effect of preventing or unreasonably

interfering with railroad transportation.” Id. at 895. Defendants’ brief is unclear as to

whether they rely on categorical preemption, as-applied preemption, or both, to support

their argument that ICCTA preemption obtains. Either way, the Court is not persuaded

that dismissal is appropriate at this stage.

Categorical preemption can itself be broken down into two forms. The first is “any

form of state or local permitting or preclearance that, by its nature, could be used to deny

a railroad the ability to conduct some part of its operations or to proceed with activities

that the Board has authorized.” CTA, 647 F.3d at 679 n.3 (quoting CSX Transp., Inc.—

Petition for Declaratory Order, 2005 WL 1024490, at *2 (S.T.B. May 3, 2005)). The second is

any “state or local regulation of matters directly regulated by the Board.” Id. The

complaint says nothing about “local permitting or preclearance” that could deny

Defendants the ability to conduct their operations. Defendants do not claim otherwise.

This case is about a natural disaster, which, the Kellers claim, was exacerbated by

Defendants’ failure to take care of their property. Nowhere do the Kellers allege that

Defendants failed to obtain a permit or preclearance to operate in Illinois. Accordingly,

the Kellers’ negligence claim is not categorically preempted by a “local permitting or

preclearance” requirement.

The Court is also unpersuaded that the Kellers’ negligence claim, as pled,

constitutes a regulation of matters “directly regulated by the Board.” It is true that the

complaint accuses Defendants of “fail[ing] to fix, adjust, redesign, or make any

improvements on the land of the Bridge,” and of failing to “regularly monitor and

maintain” the area surrounding the bridge over Little Canteen Creek. Defendants view

these allegations as an attempt to impose railway management requirements on them

with respect to “the construction, operation, and abandonment of rail lines”—areas that

are subject to categorical preemption. Wedemeyer, 850 F.3d at 895. But the Kellers were

careful to focus their allegations on Defendants’ “land,” rather than their rail lines. They

do not allege that the bridge was constructed in an unsafe manner or that Defendants’

operations caused their injuries. So, another interpretation of the allegations in the

complaint is that the Kellers simply want Defendants clean up debris on their property

to reduce the risk of catastrophic flooding on adjoining properties. And with respect to

such activity, Defendants have cited no statutory or regulatory authority, suggesting that

it is “directly regulated by the Board.” This creates a problem for Defendants’ categorical

preemption argument because it is their burden to prove that the Kellers’ negligence

claim is preempted as pled. See Rogers v. BNSF Ry. Co., No. 19 C 3083, 2019 WL 5635180,

at *2 (N.D. Ill. Oct. 31, 2019) (rejecting ICCTA preemption argument in motion to dismiss

because plaintiff’s state law claim “imposes no limits or restrictions on the movement of

property or persons.”).

Based on the scant record available, the Court is unwilling to find that debris

removal constitutes a regulation of rail transport that would trigger categorical

preemption. Indeed, the Court struggles to see how the Kellers’ request that Defendants

clean up trash on their property “relate[s] to the movement of passengers or property, or

both, by rail” at all. 49 U.S.C. § 10102(9)(A) (defining “transportation” under the ICCTA).

And “where a tort claim is premised upon a railroad’s activities on its property that have

only a remote or incidental connection to ‘rail transportation’ or ‘operation’ of railroad

tracks or facilities[] but rather are ‘tortious acts committed by a landowner who happens

to be a railroad company,’ the claim is not expressly preempted by the ICCTA.” Benson

v. Union Pac. R.R. Co., No. 2:08-cv-331, 2008 WL 2946331, at *4 (E.D. Cal. July 25, 2008)

(quoting Emerson v. Kansas City S. Ry. Co., 503 F.3d 1126, 1130 (10th Cir. 2007)). If, after

discovery, the Kellers’ theory of liability is indeed based on Defendants’ faulty

construction and operation of its rail lines, or other matters “directly regulated by the

Board,” then Defendants may have a compelling argument for categorical preemption.

But because the Kellers appear to focus on Defendants’ role as a property owner rather

than a railway operator, the Court is not persuaded that they have pleaded themselves

out of court by “admit[ting] all the ingredients of an impenetrable defense.” Xechem, 372

F.3d at 901.

Finally, to the extent that Defendants argue that the Kellers’ negligence claim is

preempted as applied, that argument is similarly premature. As applied preemption

depends on “the degree of interference that [a state action] has on railroad

transportation.” Wedemeyer, 850 F.3d at 895. This is a fact-sensitive inquiry because as

applied preemption under the ICCTA happens on a sliding scale: “the more disruptive a

claim is to a railroad’s operations, the more likely it is to be preempted.” Ill. Dep’t of

Transp. v. Union Pac. R.R. Co., No. 3:24-CV-00614, 2024 WL 5007729, at *3 (S.D. Ill. Dec.

6, 2024). Here, the complaint does not reveal an attempt to interfere with Defendants’

railroad operations; the Kellers simply want Defendants to clear debris from their

property so that theirs may be spared future flooding. Discovery may, of course, expose

the Kellers’ negligence claim as unduly disruptive to Defendants’ operations. And if that

happens, the claim may be preempted as applied. But whether and, if so, how,

Defendants’ operations would be disrupted is anyone’s guess at this point. Thus, the

issue is not ripe for disposition under Rule 12(b)(6).

Other courts have reached similar conclusions when presented with ICCTA

preemption arguments in a motion to dismiss. See e.g., Fleury v. Union Pac. R.R. Co., 528

F. Supp. 3d 885, 896 (N.D. Ill. 2021) (denying motion to dismiss state law claim based on

ICCTA preemption because of “the dearth of facts” in the record); Dawn Kehrer Revocable

Tr. v. Norfolk S. Ry., No. 24-cv-1786, 2024 WL 5007781, at *5 (S.D. Ill. Dec. 6, 2024)

(recognizing that preemption under ICCTA and other federal statutes is a “fact-intensive

inquiry not suitable for resolution on a Rule 12(b)(6) motion to dismiss.”); Smith v. CSX

Transp., Inc., No. 14 C 5704, 2015 WL 350981, at *3 (N.D. Ill. Jan. 27, 2015) (rejecting ICCTA

preemption argument in motion to dismiss because although plaintiffs’ claims “may

ultimately be preempted, that issue is more appropriately resolved on a fully developed

factual record.”); cf. Rogers, 2019 WL 5635180, at *3. The Court finds these cases instructive

and declines to find the Kellers’ negligence claim preempted by the ICCTA. Defendants

will have an opportunity to raise the issue in a motion for summary judgment after the

close of discovery.

b. FRSA Preemption

Defendants also invoke federal preemption under the FRSA as a basis for

dismissal. Congress passed the FRSA “to promote safety in every area of railroad

operations and reduce railroad-related accidents and incidents.” 49 U.S.C. § 20101. The

statute gives the Secretary of Transportation wide-ranging authority to “prescribe

regulations and issue orders for every area of railroad safety.” Id. § 20103(a). Moreover,

beyond just promoting “safety” in railroad operations generally, “[l]aws, regulations,

and orders related to railroad safety and laws, regulations, and orders related to railroad

security shall be nationally uniform to the extent practicable.” Id. § 20106(a)(1).

The FRSA contains an express preemption provision, which permits states to

continue regulating “railroad safety” matters “until the Secretary of Transportation . . .

prescribes a regulation or issues an order covering the subject matter of the State

requirement.” Id. § 20106 (a)(2); see also Kehrer Revocable Tr., 2024 WL 5007781, at *6

(finding that FRSA’s preemption provision “envisions the continuing validity of some

state railroad safety laws.”). Preemption under the FRSA is thus only triggered if a federal

regulation “cover[s] the same subject matter” as a state requirement. CSX Transp., Inc. v.

Easterwood, 507 U.S. 658, 664 (1993).

So, what then does it mean for a federal regulation to “cover” the same subject

matter as a state regulation? The Supreme Court answered that question in Easterwood:

“To prevail on the claim that the regulations have preemptive effect,” the party raising

the preemption defense “must establish more than that they ‘touch upon’ or ‘relate to’

that subject matter.” Id. “’[C]overing,’” the Court explained, “is a more restrictive term

which indicates that preemption will lie only if the federal regulations substantially

subsume the subject matter of the relevant state law.” Id. Here, the issue is whether one

or more federal railroad safety regulations, “cover the subject matter” of the Kellers’

negligence claim.

Defendants cite several regulations related to the inspection and maintenance of

railroad tracks to support their claim that federal standards “cover” the subject matter of

the Kellers’ negligence claim. 49 C.F.R. § 213.7(b) requires “track owner[s]” to “designate

qualified persons to inspect track for defects,” and specifies the qualifications that

inspectors must demonstrate. 49 C.F.R. § 213.33 stipulates that “[e]ach drainage or other

water carrying facility under or immediately adjacent to the roadbed shall be maintained

and kept free of obstruction, to accommodate expected water flow for the area

concerned.” 49 C.F.R. § 213.233 requires all tracks to be “inspected in accordance with

[a specified] schedule” and demands “immediate[]” remedial action if a “deviation” is

found. 49 C.F.R. § 213.237 requires “internal rail inspections” in addition to those

specified in § 213.233 to minimize “service failure rates.” And finally, 49 C.F.R. § 213.239

states that “[i]n the event of fire, flood, severe storm, or other occurrence which might

have damaged track structure, a special inspection shall be made of the track involved as

soon as possible after the occurrence and, if possible, before the operation of any train

over that track.”

As the Court sees it, these regulations, at best, “touch upon” or “relate to” the

Kellers’ theory of liability. The complaint does not accuse Defendants of improperly

constructing or maintaining their tracks or other equipment they rely on for their

operations. Rather, it alleges that Defendants—as landowners—failed to take care of their

property and, in doing so, exposed the Kellers to major flooding that damaged their

crops. That matter is not “substantially subsumed” by the regulations Defendants cite.

Their argument conflates regulatory standards governing track construction and

maintenance with general property maintenance. And under this interpretation, these

regulations would govern the maintenance of all real property that is owned by a railroad,

regardless of its relationship or proximity to a track. That is a bridge too far. See Norfolk

S. Ry. Co. v. Box, 556 F.3d 571, 572 (7th Cir. 2009).

The Seventh Circuit rejected similar logic in Box, where a railroad claimed that a

state requirement for the installation of walkways parallel to train tracks was preempted.

Id. at 571-72. The railroad cited several regulations governing track construction and

argued that they “covered” the subject matter of the state requirement. Id. at 572. But

although federal regulations provided detailed guidance for the construction of

“roadbed” and “track safety standards,” none “deal[t] with walkways.” Id. at 572-73. The

court found that, under the railroad’s argument, the preemption provision’s second

sentence—which allows states to adopt railroad safety regulations until the Secretary of

Transportation acts on the matter—would be “self-defeating:” “Instead of providing a

division between state and federal spheres (in which the state rule prevails unless a

federal rule covers the topic), the sentence would effectively read: ‘All state laws and

regulations related to railroad safety and security are preempted.’” Id. at 573. And

because the FRSA says nothing of the sort, the court declined to interpret regulations

addressing roadbed construction as also covering parallel walkways. See id. (“The rules

for roadbed construction and maintenance do not ‘cover’ the subject of adjacent

walkways.”). So too, here. Without a federal regulation that “covers” debris removal on

a railroad’s property beyond its tracks or the area “immediately adjacent to the roadbed,”

the Court is not convinced that Illinois’ negligence framework has been preempted.

Defendants may reassert an FRSA preemption argument after the close of discovery.

4. Duty

Defendants’ final argument contends that the Kellers failed to plead a recognized

duty under Illinois law. Specifically, they claim that the complaint offers only undefined

“duties” to “communicate” with local authorities, and to “inspect,” and “maintain” their

property. This argument is more simply rejected because Illinois does recognize certain

duties that are sufficiently pled to survive a motion to dismiss.

Illinois has long recognized that “every person owes a duty of ordinary care to all

others to guard against injuries which naturally flow as a reasonably probable and

foreseeable consequence of an act, and such a duty does not depend upon contract,

privity of interest or the proximity of relationship, but extends to remote and unknown

persons.” Simpkins v. CSX Transp., Inc., 965 N.E.2d 1092, 1097 (Ill. 2012) (quoting

Widlowski v. Durkee Foods, Div. of SCM Corp., 562 N.E.2d 967, 968 (Ill. 1990)). “Thus, if a

course of action creates a foreseeable risk of injury, the individual engaged in that course

of action has a duty to protect others from such injury.” Id. There can be no serious debate

that Defendants are subject to this general duty of ordinary care, like everyone else in

Illinois.

But Defendants are also subject to an important duty as landowners. “At common

law, a landowner bears a duty not to increase the natural flow of surface water onto the

property of an adjacent landowner.” Van Meter v. Darien Park Dist., 799 N.E.2d 273, 279

(Ill. 2003). The complaint invokes precisely this duty. It alleges that (i) debris on

Defendants’ property “substantially impeded the creek’s natural flow;” (ii) this condition

caused the accumulation of water, which ultimately flooded of the Kellers’ property; and

(iii) Defendants, through their acts or omissions, breached their “duty to prevent the

unnatural accumulation of water on their property.” The fact that certain alleged “duties”

in the complaint have not been recognized in their exact form by the Illinois Supreme

Court does not change the fact the complaint sufficiently alleges a duty that is recognized

under Illinois law. At this stage of the case, that is all that is required.

CONCLUSION

For these reasons, Defendants’ motion to dismiss Plaintiff’s complaint (Doc. 13) is

GRANTED in part and DENIED in part. Count I of Plaintiffs’ complaint is DISMISSED

without prejudice.

Because Plaintiffs filed a consolidated complaint and only Caseyville’s claim is

now dismissed, Caseyville has two options: (1) it may file an amended consolidated

complaint with the Kellers in which it amends only its claims against Defendants; or (2) it

may file a separate amended complaint on its own behalf. Whichever option Caseyville

chooses, its amended complaint is due on or before October 9, 2025.

IT IS SO ORDERED.

DATED: September 9, 2025 Tl

NANCY J. ROSENSTENGEL |

Chief U.S. District Judge

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