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U.S. judge scraps CSX jury trial in rail antitrust case

(Reuters) - A U.S. judge in Virginia on Tuesday blocked freight carrier CSX Transportation Inc from pursuing federal antitrust claims alleging a top rail industry rival has cost it hundreds of millions of dollars in damages in lost customer contracts.


Chief U.S. District Judge Mark Davis of the Eastern District of Virginia federal court largely ruled for CSX rival Norfolk Southern Railway Co in a 104-page decision that closely examined competition for on-dock rail access at Norfolk International Terminals, the Virginia Port Authority's largest shipping dock.


The judge canceled a jury trial scheduled for Jan. 18 and converted it instead to a bench trial on whether CSX is entitled to an injunction on a matter involving another defendant, the Norfolk & Portsmouth Belt Line Railroad Co, a joint venture formed in the late 19th Century by a collection of railroads.


CSX had accused Norfolk Southern of a decades-long effort to exclude it from rail access at the Norfolk terminal. But Davis said in his ruling that CSX's federal antitrust claims were outside of a four-year legal window and therefore time-barred.


The two rail companies are among the country's largest freight carriers, and they compete to transport containers that arrive at U.S. ports.


CSX co-owns Norfolk & Portsmouth Belt Line with Norfolk Southern, which is a majority owner. CSX had accused Norfolk Southern of colluding with Norfolk & Portsmouth Belt Line to harm CSX.


Davis said a ruling that would back CSX on its antitrust allegations "would turn the legal test for damages on its head by allowing a plaintiff that has slept on its rights for years to resurrect a time-barred claim on the basis of supposition rather than evidence." CSX's lawyers at McGuireWoods on Wednesday declined to comment. A spokesperson for the Jacksonville, Florida-based rail line said it planned to appeal the court's ruling.


Lawyers for Norfolk Southern at Troutman Pepper Hamilton Sanders and attorneys for Norfolk & Portsmouth Belt Line at Crenshaw, Ware & Martin did not immediately respond to similar messages.


CSX, which recorded $3.9 billion in revenue in the 3rd quarter, sued Norfolk Southern and Norfolk & Portsmouth Belt Line in 2018 in Virginia federal court.


The two defendants have access to the Norfolk International Terminals, but CSX must rely on Norfolk & Portsmouth's contractual right to use tracks owned by Norfolk Southern.


Davis said in his ruling "it is important to ensure that [Norfolk Southern's] lawful competitive conduct, even if aggressive, is not mistaken as an antitrust act."


The case is CSX Transportation Inc v. Norfolk Southern Railway et al, U.S. District Court for the Eastern District of Virginia, No. 2:18-cv-530-MSD.


For CSX: Robert McFarland and Benjamin Hatch of McGuireWoods


For Norfolk Southern: Alan Wingfield and Michael Lacy of Troutman Pepper Hamilton Sanders; Tara Reinhart of Skadden, Arps, Slate, Meagher & Flom


For Norfolk & Portsmouth: James Chapman and W. Ryan Snow of Crenshaw, Ware & Martin


This article originally appeared on Reuters

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