Kessler v. Surface Transportation Board

United States Court of Appeals

FOR THE DISTRICT OF COLUMBIA CIRCUIT

Argued September 20, 2010 Decided March 15, 2011

No. 09-1188

EDWIN KESSLER AND JAMES RIFFIN,

PETITIONERS

v.

SURFACE TRANSPORTATION BOARD AND UNITED STATES OF

AMERICA,

RESPONDENTS

BNSF RAILWAY COMPANY,

INTERVENOR

On Petition for Review of an Order

of the Surface Transportation Board

James Riffin, appearing pro se, argued the cause and filed

the briefs for petitioners. Edwin Kessler, appearing pro se,

entered an appearance.

James B. Boles, Attorney, Surface Transportation Board,

argued the cause for respondents. With him on the brief were

Robert B. Nicholson and John P. Fonte, Attorneys, U.S.

Department of Justice, Ellen D. Hanson, General Counsel,

Surface Transportation Board, and Craig M. Keats, Deputy

2

General Counsel. Erik G. Light, Attorney, entered an

appearance.

Before: GINSBURG, ROGERS and GARLAND, Circuit

Judges.

Opinion for the Court filed by Circuit Judge GINSBURG.

GINSBURG, Circuit Judge: Edwin Kessler and James

Riffin petition for review of an order of the Surface

Transportation Board (STB) denying them preliminary

injunctive relief. We dismiss their petition because we lack

jurisdiction to decide all but one of the claims presented and

the petitioners have failed to exhaust their administrative

remedies as to that claim.

I. Background

In July 2008 Kessler contracted with BNSF Railway Co.

to have a locomotive he leased from Riffin transported and

delivered to himself, “care of Boardman, Inc.,” a company in

Oklahoma City with property abutting his own. After taking

possession of the locomotive BNSF found Boardman would

not accept delivery of the locomotive and so informed

Kessler. When the parties failed to agree upon a suitable

alternative arrangement for delivery, BNSF notified Kessler it

was going to sell the locomotive at auction, as provided in the

bill of lading, if he did not himself make arrangements to

dispose of it.



Despite Riffin’s admission at oral argument that the locomotive

belongs to him, because both parties’ filings refer to the locomotive

as belonging to Kessler instead of Riffin, and because Kessler is the

named party in the proceedings in front of the STB, we refer to

Kessler as the singular owner of the locomotive.

3

Kessler then asked the STB for an injunction to stop the

sale of the locomotive and to compel BNSF to complete

delivery. Kessler also asked the STB to order BNSF to pay

him damages of $50.00 for each day delivery was delayed and

to relieve him of any obligation to pay demurrage fees. That

motion was filed on January 26, 2009 and was duly opposed

by BNSF.

The STB had not yet ruled upon Kessler’s motion when,

on May 18 of that year, BNSF notified the STB it planned to

begin the auction of Kessler’s locomotive in one week. On

June 2 Kessler filed with the STB an emergency request for

immediate relief, but on June 8 he moved voluntarily to

dismiss both motions pending with the Board so that he might

instead pursue relief in court. Later that day Kessler filed a

motion for a temporary restraining order and a preliminary

injunction in the U.S. District Court for the District of

Maryland. Riffin v. BNSF Ry., No. 8:09-cv-1502.

On June 12 the Board denied Kessler’s motion to dismiss

and resolved on the merits his motions for injunctive relief.

See Edwin KesslerPetition for Injunctive Relief, STB Dkt

No. FD-35206 [hereinafter STB Decision]. The STB held

Kessler did not show the auction would irreparably harm him

because, contrary to Kessler’s representation, the locomotive

was easily replaceable. Id. at 5. The Board also held an

injunction would not be in the public interest: Although

BNSF had a general duty as a common carrier to serve all

comers, Kessler had not shown how the public would benefit

from enjoining the sale of a locomotive that was shipped not

for any commercial purpose “but simply to ‘test’ BNSF.” Id.



For any of the parties’ filings or the STB’s decisions, see

http://www.stb.dot.gov.

4

at 6. The Board accordingly denied Kessler's motion to

enjoin the auction. Id. The Board also refused to compel

BNSF to deliver the locomotive; because the “true nature of

[Kessler’s] dispute” with BNSF was unclear, the Board held

Kessler failed to show he would likely prevail upon his claim

BNSF violated its common law duties. Id. With respect to

Kessler’s requests for relief from demurrage and other fees,

and for $50.00 in damages for each day delivery was delayed,

the Board held, respectively, that the record provided no basis

for enjoining BNSF from the collection of those charges and

that claims for monetary damages are properly raised in a

complaint proceeding and not as a part of a motion for

injunctive relief. Id. at 7.

Shortly after the Board issued its order, BNSF sold

Kessler’s locomotive at public auction for $5,000. The

Maryland district court then denied as moot (among other

defects) Kessler’s pending motion for a TRO and dismissed

his claim without prejudice.

In this court Kessler seeks review of the Board’s order

denying him injunctive and other relief. He argues the

Board’s decision is both incorrect on the merits and

procedurally infirm. The Board responds that we should

dismiss Kessler’s petition for review because his petition

asking the Board for injunctive relief is now moot and

because, as to other relief, he has failed to exhaust his

administrative remedies. We agree with the Board and

accordingly we dismiss the petition in its entirety.

II. Analysis

We may disturb the Board’s order denying Kessler

preliminary relief only if it is “arbitrary, capricious, an abuse

of discretion, or otherwise not in accordance with law.” 5

5

U.S.C. § 706(A)(2); Riffin v. Surface Transp. Bd., 592 F.3d

195, 197 (D.C. Cir. 2010). Before we may do so, however,

we must determine whether we have jurisdiction, in whole or

in part, over Kessler’s petition for review. Ctr. for Arms

Control & Non-Proliferation v. Pray, 531 F.3d 836, 839 n.

(D.C. Cir. 2008).

It is uncontroverted that BNSF has sold Kessler’s

locomotive to a third party and that the purchaser is not before

the court. Kessler’s request for an injunction against the sale

is therefore moot and accordingly beyond our jurisdiction.

See Calderon v. Moore, 518 U.S. 149, 150 (1996) (“an appeal

should ... be dismissed as moot when, by virtue of an

intervening event, a court of appeals cannot grant any

effectual relief whatever in favor of the appellant”) (internal

quotation marks omitted); Bunn v. Werner, 210 F.2d 730, 731

(D.C. Cir. 1954) (injunction filed to prevent “a foreclosure

sale of certain real estate” dismissed as moot after foreclosure

sale had taken place); cf. FTC v. Weyerhaeuser Co., 665 F.2d

1072, 1077 (D.C. Cir. 1981) (sale does not moot an appeal

where all parties including the purchaser are before the court).

We likewise lack jurisdiction over and dismiss the

portions of Kessler’s petition that would have the court (i)

“compel the Board to compel BNSF” to retrieve the

locomotive from its current owner and deliver it to Kessler,

and (ii) order BNSF to (a) pay Kessler damages for delayed

delivery of his locomotive and (b) discharge any outstanding

demurrage fees. First, the current owner of the locomotive is

not a party to this litigation and the court will not issue an

order affecting the rights of an absent third party. Richards v.

Jefferson Cnty., 517 U.S. 793, 797 n.4 (1996) (“The

opportunity to be heard is an essential requisite of due process

of law in judicial proceedings”). Second, insofar as Kessler’s

claims arise from the carrier’s liability under the bill of

6

lading, they must be filed in the first instance in a district or

state court. 49 U.S.C. § 11706(d)(1).

To the extent Kessler asks us to order the Board to

investigate whether BNSF has improperly abandoned a rail

line or failed to fulfill its obligation as a common carrier

pursuant to 49 U.S.C. § 11101, we dismiss his petition

because he failed to exhaust his administrative remedies.

Under 49 U.S.C. § 11701, the STB may initiate an

investigation of a rail carrier “only on complaint.” The STB

has issued a regulation prescribing the form and manner in

which a complaint must be filed. See 49 C.F.R. § 1111.1.

Kessler’s failure to comply with that regulation puts his

arguments in this regard out of court. See Chicago & Nw.

Transp. Co. v. Kalo Brick & Tile Co., 450 U.S. 311, 321–23

(1981) (“Congress intended that an aggrieved shipper should

seek relief in the first instance from the Commission”).

Finally, Kessler argues the Board somehow acted

improperly by denying his motion voluntarily to dismiss his

pending motions for injunctive relief and going on to reach

the merits of his claim. Kessler therefore asks us to vacate the

Board’s decision so he is not collaterally estopped from filing

a complaint in the district court “to compel BNSF to retrieve

the locomotive if it has not in fact been scrap[p]ed, ... [to]

order BNSF to find another locomotive that is similar to [that

sold], or [to] provide ... compensatory and punitive damages.”



Under 49 U.S.C. § 11702, the Board may also bring a civil action

“to enjoin a rail carrier from violating §§ 10901 through 10906.”

Kessler has not sought such an action, nor does it appear a Board

decision in that regard would be subject to judicial review. See 5

U.S.C. § 701(a)(2) (exempting from review actions committed by

law to an agency’s discretion).

7

Kessler’s concern is ill-founded. Kessler will not be able

to obtain an order compelling BNSF to retrieve his

locomotive regardless whether we vacate the Board’s

decision: the locomotive has been sold at auction.

Accordingly, as a practical matter, damages are the only form

of relief against BNSF still available to Kessler. See 49 U.S.C

§§ 11704 (a carrier “is liable for damages sustained” as a

result of a violation of the ICCTA), 11706 (permitting a civil

suit for “actual loss or injury” to property shipped pursuant to

a bill of lading); see also Rymes Heating Oils, Inc. v.

Springfield Terminal Ry., 358 F.3d 82, 89 (1st Cir. 2004)

(Ҥ 11704(b) clearly provides a damages action for a direct

statutory violation of the ICCTA itself”) (emphasis added). In

that regard, the Board’s order expressly states, “Kessler may

yet pursue his claim that BNSF violated its common carrier

duty” by filing with the Board a complaint for “appropriate

damages.” STB Decision, at 6. If the Board’s order does not

prevent Kessler from seeking damages from the Board, we

fail to see how it would prevent him from seeking that same

relief from a district court. See 49 U.S.C. § 11704(c)(1) (a

person injured as a result of a carrier’s violation of the Act

“may file a complaint with the Board under § 11701(b) ... or

bring a civil action”). Because vacating the Board’s decision

would not provide Kessler with the relief he seeks, a ruling

upon the propriety of the Board’s decision would be no more

than advisory. See Chicago & S. Air Lines v. Waterman S.S.

Corp., 333 U.S. 103, 113–14 (1948) (“This Court early and

wisely determined that it would not give advisory opinions”).

III. Conclusion

For the foregoing reasons, the petition for review is

Dismissed.