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If ‘‘Yes’’ for modem and hardware
question, what is the monthly rental price for
necessary hardware? (if provider rents
hardware.)
Computer/laptop hook-up by service
technician already making a service visit.
III.c.3 Recurring Rates (Use Only If
Multiple Rates)
Only answer the following rates and
charges questions if reporting multiple rates
and/or taxes/fees/surcharges for the same
service in the same Census tract. Report rates
and charges for the greatest total monthly
cost offering.
Recurring monthly charge
Total of state, local, and municipal taxes
Total of all other mandatory fees and taxes
(such as provider surcharges, etc.) passed
through.
Surcharges on the service accounted as
company revenue (i.e. non-pass through)
III.c.4 Non-Recurring Rates (Use Only If
Multiple Rates)
For each item listed, report the minimum
amount a customer would pay for each nonrecurring charge if the item is required for the
Internet service. If an item is not offered by
the provider, then mark it as ‘‘NA’’.
Activation or connection not requiring a
service visit to the premises
Activation or connection requiring a service
visit (but assuming the premises is already
physically wired)
Does this service require the customer use a
modem or other hardware? (yes/no)
If ‘‘Yes’’ for modem and hardware question,
what is the purchase price for necessary
hardware? (if provider sells such
hardware.)
If ‘‘Yes’’ for modem and hardware question,
what is the monthly rental price for
necessary hardware? (if provider rents
hardware.)
Computer/laptop hook-up by service
technician already making a service visit.
[FR Doc. 2013–10567 Filed 5–16–13; 8:45 am]
BILLING CODE 6712–01–P
DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
49 CFR Parts 1002, 1011, 1108, 1109,
1111, and 1115
[Docket No. EP 699]
Assessment of Mediation and
Arbitration Procedures
AGENCY:
Surface Transportation Board,
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DOT.
ACTION:
Final rules.
The Surface Transportation
Board (Board or STB) adopts regulations
that allow the Board to order parties to
participate in mediation in certain types
of cases and modify and clarify its
existing mediation regulations. The
Board also establishes a new arbitration
SUMMARY:
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program under which carriers and
shippers may agree voluntarily in
advance to arbitrate certain types of
disputes that come before the Board,
and clarifies and simplifies its existing
arbitration rules.
DATES: These rules are effective on June
12, 2013.
ADDRESSES: Information or questions
regarding these final rules should
reference Docket No. EP 699 and be in
writing addressed to: Chief, Section of
Administration, Office of Proceedings,
Surface Transportation Board, 395 E
Street SW., Washington, DC 20423–
0001.
FOR FURTHER INFORMATION CONTACT:
Amy C. Ziehm at 202–245–0391.
[Assistance for the hearing impaired is
available through the Federal
Information Relay Service (FIRS) at
1–800–877–8339.]
SUPPLEMENTARY INFORMATION: The Board
favors the resolution of disputes through
the use of mediation and arbitration
procedures, in lieu of formal Board
proceedings, wherever possible.1 To
that end, the Board has existing rules
that encourage parties to agree
voluntarily to mediate or arbitrate
certain matters subject to its
jurisdiction. The Board’s mediation
rules are set forth at 49 CFR 1109.1,
1109.3, 1109.4, 1111.2, 1111.9, and
1111.10. Its arbitration rules are set forth
at 49 CFR 1108, 1109.1, 1109.2, 1109.3,
and 1115.8. In a decision served on
August 20, 2010,2 and published in the
Federal Register on August 24, 2010,3
we sought input on how to increase the
use of mediation and arbitration to
resolve matters before the Board.4 The
1 Mediation is a process in which parties attempt
to negotiate an agreement that resolves some or all
of the issues in dispute, with the assistance of a
trained, neutral, third-party mediator. Arbitration,
by comparison, is an informal evidentiary process
conducted by a trained, neutral, third-party
arbitrator with expertise in the subject matter of the
dispute. By agreeing to participate in arbitration,
the parties agree to be bound (with limited appeal
rights) by the arbitral decision.
2 Assessment of Mediation and Arbitration
Procedures, EP 699 (STB served Aug. 20, 2010).
3 Assessment of Mediation and Arbitration
Procedures, 75 FR 52054.
4 Assessment of Mediation and Arbitration
Procedures, EP 699 (STB served Dec. 3, 2010). The
Board served a subsequent notice in this matter on
December 3, 2010, to clarify that any comments
filed by the Railroad-Shipper Transportation
Advisory Council (RSTAC) would be accorded the
same weight as other comments in developing any
new rules. RSTAC is an advisory board established
by Federal law to advise the U.S. Congress, the U.S.
Department of Transportation, and the Board on
issues related to rail transportation policy, with
particular attention to issues of importance to small
shippers and small railroads. By statute, RSTAC
members are appointed by the Board’s chairman.
Representatives of large and small rail customers,
Class I railroads, and small railroads sit on RSTAC.
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29071
Board received comments from 12
parties.5
On March 28, 2012, the Board issued
a Notice of Proposed Rulemaking
(NPRM) incorporating the previous
comments and concerns of the parties.
The Board proposed regulations that
would allow the Board to order parties
to participate in mediation in certain
types of cases and would modify and
clarify its existing mediation rules. The
Board also proposed an arbitration
program under which carriers and
shippers would agree voluntarily to
arbitrate certain types of disputes, and
proposed modifications to clarify and
simplify its existing rules governing
arbitration in other disputes.6
The Board sought comments on the
proposed regulations by May 17, 2012,7
and replies by June 18, 2012.8 On
August 2, 2012, the Board held a public
hearing to further explore the NPRM
and the comments of the parties. At the
public hearing, the Board heard
testimony from the NGFA, NITL, WCTL,
AAR, NS, UP, UTU–NY, The Tom
O’Connor Group (Tom O’Connor), and
the Alliance for Rail Competition
(ARC).9
As explained in the NPRM, the
Board’s arbitration processes have
remained largely unused since they
were instituted.10 The changes to the
The Board’s members and the U.S. Secretary of
Transportation are ex officio, nonvoting RSTAC
members. (49 U.S.C. 726.)
5 The Board received comments from the U.S.
Department of Agriculture (USDA), the Association
of American Railroads (AAR), Consumers United
for Rail Equity (CURE), the National Grain and Feed
Association (NGFA), the National Oilseed
Processors Association (NOPA), RSTAC,
Transportation Arbitration and Mediation, P.L.L.C.
(TAM), the Western Coal Traffic League (WCTL),
Dave Gambrel, and Gordon P. MacDougall for the
United Transportation Union–New York State
Legislative Board (UTU–NY). The American Paper
& Forest Association (APFA) and The National
Industrial Transportation League (NITL) filed joint
comments.
6 Assessment of Mediation and Arbitration
Procedures, EP 699 (STB served Mar. 28, 2012).
7 The Board received comments from BNSF
Railway Company (BNSF), Norfolk Southern
Railway Company (NS), Union Pacific Railroad
Company (UP), AAR, WCTL, Montana Grain
Growers Association (MGGA), NGFA, NITL,
National Railroad Passenger Corporation
(AMTRAK), USDA, and UTU–NY.
8 The Board received replies from AAR, UP,
WCTL, NITL, and UTU–NY.
9 Terry Whiteside appeared on behalf of the
following parties: ARC, Montana Wheat & Barley
Committee, Colorado Wheat Administrative
Committee, Idaho Barley Commission, Idaho Wheat
Commission, Nebraska Wheat Board, Oklahoma
Wheat Commission, South Dakota Wheat
Commission, Texas Wheat Producer Board, and
Washington Grain Commission.
10 The Board first adopted arbitration rules in
Arbitration of Certain Disputes Subject to the
Statutory Jurisdiction of the Surface Transportation
Board, EP 560 (STB served Sept. 2, 1997).
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Board’s arbitration rules are intended to
consolidate the separate arbitration
procedures in Parts 1108 and 1109, and
to encourage greater use of arbitration to
resolve disputes before the Board by
simplifying the process, identifying
specific types of disputes eligible for a
new arbitration program, and
establishing clear limits on the amounts
in controversy.11 As discussed below,
the Board believes that the proposed
arbitration program it now establishes
will be useful to both shippers and
carriers, facilitating the resolution of
disputes in a less time-consuming and
expensive manner than through the
Board’s formal adjudicatory processes.
Additionally, as arbitration is
potentially less adversarial, it can help
the parties to preserve their commercial
relationship.12
In designing the arbitration program
set forth in these final rules, the Board
sought to incorporate the suggestions of
the commenting parties to the maximum
extent possible. The resulting arbitration
program is designed to be flexible,
party-driven, and functional. Under the
new arbitration program, all parties
eligible to bring matters before the
Board will have the opportunity to opt
into the arbitration program before a
dispute arises. Parties will also have the
option to opt into the arbitration
program when a dispute is formally
filed with the Board, provided the
parties agree to do so in writing.
Arbitration-program-eligible matters are
limited to demurrage; accessorial
charges; misrouting or mishandling of
rail cars; and disputes involving a
carrier’s published rules and practices
as applied to particular rail
transportation. The parties may also
agree in writing, prior to the
commencement of arbitration, to
arbitrate certain additional matters,
subject to the condition that they may
only arbitrate matters within the
statutory jurisdiction of the Board, and
may not arbitrate matters in which the
Board is required to grant or deny a
license or other regulatory approval or
exemption. Furthermore, the monetary
award cap under the Board’s new
program will be set at $200,000. In
response to comments, the final rules
provide that parties may agree to a
different award level when they opt into
the program or by a separate written
11 The Board has authority to revise its arbitration
rules under 49 U.S.C. 721(a) and under the
Alternative Dispute Resolution Act, 5 U.S.C. 571–
584.
12 Alternative Dispute Resolution Act of 1998,
Public Law 105–315, § 2, 112 Stat. 2993 (1998)
(discussing the benefits of alternative dispute
resolution).
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agreement at the start of an arbitration
proceeding.
The changes to the existing mediation
rules establish procedures under which
the Board may order the parties to
participate in mediation in certain types
of disputes before the Board, on a casespecific basis, and clarifies and
simplifies the existing mediation
rules.13 The Board will assign one or
more Board employees, trained in
mediation, to conduct the mediation.
Mediation periods will last up to 30
days, but can be extended upon the
mutual request of the parties. The Board
reserves the right to stay underlying
proceedings and to toll any applicable
statutory deadlines when the parties
mutually consent to mediation.
However, the Board will not stay
proceedings or toll statutory deadlines
when at least one of the parties does not
consent to mediation. The Board
concludes that the revised mediation
rules are in the public interest. If a
dispute is amicably resolved, it is likely
that the parties would incur
considerably less time and expense than
if they used the Board’s formal
adjudicatory process.
There are important limitations to the
types of matters that can be the subject
of the mediation and arbitration
program. The mediation and arbitration
rules are not available to resolve any
matter in which the Board is statutorily
required to grant or deny an application
or petition for exemption for a license
or other regulatory approval, or in
matters beyond the statutory
jurisdiction of the Board.14 These rules
will also not apply to labor-protection
disputes, which have their own
arbitration procedures.
The Board’s Final Rules and the
Comments of the Parties
Arbitration
Having carefully considered the
comments and testimony of the parties,
the Board adopts the following rules
governing the use of arbitration to
resolve disputes before the Board. The
Board’s arbitration rules will be revised
to consolidate the separate arbitration
procedures contained in Parts 1108 and
1109, and are intended to encourage
greater use of arbitration to resolve
disputes before the Board by simplifying
13 The Board’s authority to revise its mediation
rules exists under 49 U.S.C. 721(a) and under the
Alternative Dispute Resolution Act, 5 U.S.C. 571–
584.
14 Thus, these procedures will not be available in
a regulatory proceeding to obtain the grant, denial,
stay or revocation of a request for construction,
abandonment, acquisition, trackage rights, merger,
or pooling authority or an exemption related to
such matters.
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the process and by clarifying the types
of disputes that may be submitted under
the Board’s new arbitration program. We
discuss below the major issues raised in
the comments to our proposed
arbitration rules, and our responses to
the parties’ concerns.
Participation in the Board’s Arbitration
Program
The NPRM proposed a new
arbitration program in which Class I and
Class II rail carriers would have been
deemed to agree to participate
voluntarily in the Board’s proposed
arbitration program unless they opted
out of the program by filing a notice
with the Board. Class III rail carriers and
shippers would not have been deemed
to agree to participate but instead could
have chosen to participate in the
arbitration program on a case-by-case
basis. Under the proposed rules, there
would have been no penalty for opting
out of the Board’s arbitration program.
The option of choosing to participate in
the arbitration program on a case-bycase basis was also open to Class I and
Class II railroads if they opted out of the
arbitration program.
AAR and the participating Class I
railroads are unanimous in their
objection to the opt-out provision of the
NPRM. AAR’s position is that the
proposed arbitration program was not
voluntary, and the parties could not
meaningfully consent to arbitration.15
BNSF 16 and NS 17 echo AAR’s
concerns. UP challenges the opt-out
provision on grounds that Class I and
Class II railroads would be treated
differently from Class III railroads and
shippers.18
During the public hearing, AAR
argued that if the Board moves forward
with its proposed rule requiring Class I
and Class II railroads to agree in
advance to arbitrate certain matters,
then the requirement should be required
of all parties on an equal, reciprocal
basis.19 AAR stated that allowing
participants to opt into the program
would encourage participation.20 UP
went further stating that the opt-out
approach did not facilitate trust between
shippers and carriers.21 UP also raised
concerns that the proposed rules would
create uncertainty because tens of
thousands of shippers would have the
ability to use a one-sided mechanism to
force the Class I railroads to arbitrate
15 AAR
Comments 6, May 17, 2012.
Comments 3, May 17, 2012.
17 NS Comments 3 & 6, May 17, 2012.
18 UP Comments 4–7, May 17, 2012.
19 Public Hr’g Tr., 112, Aug. 2, 2012.
20 Id. at 113.
21 Id. at 134.
16 BNSF
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disputes.22 UP speculated that an opt-in
arbitration program, where even a few
parties on each side are opting in, may
result in more voluntary participation.23
In its comments, BNSF proposes
altering the program from an opt-out to
an opt-in program where the joining
party could specify the types of disputes
it would be willing to arbitrate.24
The Board found persuasive the
concerns and suggestions raised by
AAR, UP, BNSF, and NS, and remains
committed to establishing a functional
arbitration program, which clearly
necessitates participation by the Class I
and Class II railroads. The record and
the testimony of the carriers show that
the proposed rule requiring a Class I or
Class II railroad to opt out of the
program created an unintended
perception that the Board’s proposed
arbitration program would be
procedurally biased.
Based on the comments, and to
encourage the participation of Class I
and Class II railroads in this arbitration
program, the final rule eliminates the
opt-out procedures in favor of an opt-in
requirement for all parties. Under the
final rule, all classes of rail carriers,
shippers, and other parties eligible to
participate in disputes before the Board
may voluntarily choose to opt into the
Board’s arbitration program by filing a
notice with the Board. The Board will
then maintain a list of program
participants on its Web site. Thus, all
parties will be on an equal footing
entering into the arbitration program.
The Board recognizes that there are
many more shippers than there are
railroads, making the process of
shippers opting in a significant task.
The Board’s Office of Rail Customer and
Public Assistance will engage in
outreach with shipper organizations to
ensure that they are aware of their
options under the arbitration program.
Under the final rules, those parties
voluntarily opting into the arbitration
program are eligible to select which
arbitration-program-eligible matters they
are willing to arbitrate. An arbitral
award may not exceed a monetary cap
of $200,000, unless the parties to a
dispute agree to a different amount,
either higher or lower, in writing, on a
case-by-case basis, prior to the
commencement of arbitration. Both
railroads and shippers may voluntarily
opt into the program on a case-by-case
basis. Parties who have opted into the
program may also choose to opt out of
the program by filing a notice with the
Board. An opt-out notice will take effect
22 Id.
23 Id.
at 135–36.
Comments 3–4, May 17, 2012
24 BNSF
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90 days after filing. These opt-out
procedures may not be used to opt out
of an ongoing arbitration proceeding.
Program participants in the new
arbitration program will have prior
knowledge of the issues to be arbitrated
and the maximum amount of a
monetary award. The Board’s arbitration
program is intended to be participantdriven; allowing parties to agree in
writing to arbitrate additional matters
and change the monetary award cap on
a case-by-case basis.
Arbitration-Program-Eligible Matters
In its proposed rules, the Board
suggested matters that would be eligible
for arbitration through the program.
This list included: (1) Demurrage and
accessorial charges; (2) misrouting or
mishandling of rail cars; (3) disputes
involving a carrier’s published rules and
practices as applied to particular rail
transportation; and (4) other rail servicerelated matters.
The inclusion of the term ‘‘other
service-related matters’’ led some
commenters to suggest that arbitration
program participants, particularly Class
I and Class II railroads, would be
agreeing in advance to arbitrate matters
that were not clearly defined. AAR
asserts that, despite the list, the Board
failed to define adequately what
disputes would be subject to the
proposed arbitration program.25
Similarly, UP states that the ‘‘other
service-related matters’’ language in the
NPRM was overly broad and suggested
alternative language.26
Conversely, NITL asks that the Board
add to the list of arbitral matters: (1)
Disputes about loss and damage arising
under receipts and bills of lading
governed by 49 U.S.C. 11706; (2)
disputes about damage to shipper rail
cars; and (3) disputes involving damage
as a result of service failures not
otherwise covered in the list proposed
by the Board.27 NITL justifies these
additions by noting that they are
generally dollar-determinable, rarely
have broad policy or regulatory
ramifications, and are common sources
of dispute between railroads and
shippers.28 UP and AAR oppose an
expansion of the list of arbitrationeligible matters.29
Additionally, NITL asks that the
Board clarify whether parties could use
the Board’s arbitration process for
contract disputes where all parties to
25 AAR
Comments 7, May 17, 2012.
Comments 7–8, May 17, 2012.
27 NITL Comments 8, May 17, 2012.
28 Id.
29 UP Reply 5–7, June 18, 2012; and AAR Reply
9–10, June 18, 2012.
26 UP
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29073
the dispute agree and where the contract
does not contain an arbitration clause.30
UP opposes this approach on grounds
that this type of arbitration would
complicate the dispute resolution
process and would entangle the Board
in interpreting contracts, which the
Board generally leaves to the courts to
resolve.31 UTU–NY also raises
jurisdictional concerns and asserts that
arbitration should be confined to
transactions otherwise subject to the
Board’s jurisdiction. 32
The MGGA also advocates expanding
the scope of subjects that could be
arbitrated through the Board’s program,
requesting that parties be permitted to
arbitrate matters that could lead to
prospective relief, including freight
rates.33 UP counters that rate challenges
are complicated and that an arbitrator
would lack the expertise or resources to
handle such matters.34 Likewise, WCTL
agrees that the arbitration program
would not be appropriate to resolve
complex matters.35
During the public hearing, AAR and
the participating Class I railroads urged
the Board to remove the catch-all ‘‘other
rail service-related matters’’ provision.36
UP stated that adding clarity to the
arbitration process by reducing the
range and types of disputes would
encourage participation.37 AAR
expressed the view that the list of
arbitration-eligible matters should be
limited to specifically enumerated
matters that do not rise to a level of
policy significance and are essentially
factual disputes.38 The NGFA stated that
it has no objection to removing the
catch-all provision.39
The Board’s final rule clarifies the
types of disputes that are eligible for
arbitration under the Board’s program,
removing the catchall language of ‘‘other
rail service-related matters’’ to ensure
that the list of program-eligible matters
is clearly defined. Matters eligible for
arbitration are: Demurrage, accessorial
charges, misrouting or mishandling or
railcars, and disputes involving a
carrier’s published rules and practices
as applied to particular rail
transportation. Under the final rules, all
parties opting into the arbitration
program will have full prior knowledge
that these four matters are eligible under
the arbitration program.
30 NITL
Comments 9, May 17, 2012.
Reply 8, June 18, 2012.
32 UTU–NY Comments 9, May 17, 2012.
33 MGGA Comments 2, May 17, 2012.
34 UP Reply 9, June 18, 2012.
35 WCTL Comments 7–8, May 17, 2012.
36 Public Hr’g Tr., 147–53, Aug. 2, 2012.
37 Id. at 148.
38 Id. at 112–13.
39 Id. at 95.
31 UP
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In response to the comments, the final
rules also provide that, when submitting
an opt-in notice, parties may further
narrow the field of eligible matters that
they will agree to arbitrate. At the same
time, the final rules reflect the requests
of a number of parties for the
opportunity to arbitrate additional types
of disputes where the parties believe
arbitration could be helpful. Thus, to
provide parties with maximum
flexibility, the final rules specify that
parties may agree in writing on a caseby-case basis to arbitrate additional
matters, provided that the additional
matters are within the Board’s statutory
jurisdiction to resolve, and that the
dispute does not require the Board to
grant, deny, stay or revoke a license or
other regulatory approval or exemption,
and does not involve labor protective
conditions.
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Monetary Award Cap
The NPRM proposed that the relief
that could be awarded under the
arbitration program would be limited to
a maximum of $200,000 per arbitral
dispute, unless all parties to the matter
agreed at the commencement of
arbitration to a higher cap. However, the
Board specifically invited comments on
whether the proposed monetary award
cap should be increased or decreased.
NITL argues that the proposed cap of
$200,000 is too low and is likely to
substantially restrict the number of
disputes that might be eligible for
arbitration.40 NITL suggests that the cap
should be increased to at least
$500,000.41 That figure, according to
NITL, would better cover the majority of
disputes under the proposed arbitration
program and would make shipper
parties more likely to participate in
disputes.42 WCTL endorses the
monetary award limit put forward by
the Board.43 USDA asserts that the
proposed $200,000 cap should be
increased, or that there need be no cap
at all.44
During the public hearing, NGFA
stated that its arbitration program
currently has a cap of $200,000, but that
its cap is currently under review.45
WCTL said that it was generally
satisfied with the proposed cap of
$200,000, but that the parties should
have the option to mutually agree to
increase the amount.46 ARC
recommended a program award cap of
40 NITL
Comments 14, May 17, 2012.
41 Id.
42 Id.
43 WCTL
Comments 9, May 17, 2012.
Comments 3, May 17, 2012.
45 Id. at 64-Public Hr’g Tr., 65, Aug. 2, 2012.
46 Id. at 104.
44 USDA
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$1,000,000 to reflect the cost a party
might incur in the arbitration process
and to open the program up to a larger
number of potential users.47
UP stated that it would not rule out
participating in Board-sponsored
arbitration if the monetary award cap is
raised from $200,000 to $500,000.48 NS
stated that the cap would be one of a
number of factors it would consider in
deciding whether to participate in
arbitration and that the higher the cap
the more important a factor it would
become.49 AAR recommended that the
Board keep the cap low at least until
participants become more familiar and
comfortable with the program.50
The Board will maintain the proposed
arbitration program’s monetary award
cap of $200,000. We recognize that some
parties have concerns about this amount
but we believe an award cap of $200,000
is an appropriate starting point as the
arbitration program is introduced. Such
an amount is high enough to encompass
a wide range of disputes, but should not
be so high as to dissuade parties from
participating in the arbitration
program.51 The monetary award cap is
per case and not per occurrence. As
parties become more familiar with using
the arbitration program, the Board may
reassess the monetary award cap.
At the same time, the Board
recognizes that any monetary award cap
placed on the arbitration program may
not fully encompass every arbitrationeligible dispute. Thus, the final rules
allow parties to agree in writing to
arbitrate a dispute with a different
award amount. However, no injunctive
relief will be available through the
Board’s arbitration program because
matters in which a party seeks
injunctive relief are generally
complicated or implicate significant
policy or regulatory issues that are
better suited for resolution using the
Board’s formal adjudicatory procedures.
Counterclaims and Affirmative Defenses
The Board’s proposed rules did not
expressly provide parties with the
option to present counterclaims and
affirmative defenses in arbitration
proceedings. AAR 52 and UP 53 express
concerns about whether the railroads
could present counterclaims in the
47 Id.
at 55.
at 138.
49 Id. at 139.
50 Public Hr’g Tr., 138–39, Aug. 2, 2012.
51 For example, of 15 recent demurrage cases
before the Board, 11 would have been eligible for
arbitration under the $200,000 monetary award cap
based on the value of the case asserted in the
complaint.
52 AAR Comments 13–14, May 17, 2012.
53 UP Comments 4, May 17, 2012.
48 Id.
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proposed arbitration program and note
that the proposed rules create a
perception that shippers would hold
veto power over any such claim. At the
hearing, UP noted that, regardless of
whether the railroad or the shipper
initiated the arbitration, it would not be
cost effective to deal with only part of
a dispute through arbitration, leaving
related issues unresolved.54 NITL
suggested that the Board should allow
for counterclaims in arbitration if the
issue is arbitration-program-eligible and
is related to the same transportation
events as the primary claim.55
In response to these comments, the
final rules will allow a respondent to
file a counterclaim against a
complaining party when the respondent
files its answer to the arbitration
complaint, provided the counterclaim
arises out of the same set of
circumstances or is substantially related
to the underlying dispute, and subject to
the Board’s jurisdiction. An answer
shall also contain all affirmative
defenses that a respondent wishes to
assert against a complainant. If a party
fails to assert a counterclaim or
affirmative defense in the answer to the
complaint, it will forfeit the right to do
so at a later date. Counterclaims will not
count against the monetary award cap
selected by the parties for the initiating
complaint, because a counterclaim is a
separate claim and will be subject to its
own monetary award cap of $200,000,
unless a different cap is selected by the
parties.
Arbitrator Panel
In its proposed rules, the Board did
not propose the use of multiple
arbitrators to resolve a dispute. It did,
however, seek comments on approaches
the agency could employ if parties were
to utilize a panel of two or three
arbitrators. In response, NITL asserts
that the parties should have the option
of using a panel of three arbitrators.56 It
claims that, although many disputes
might be resolved by a single arbitrator,
there are some disputes in which the
collective judgment of three persons
might be useful.57 NITL argues,
however, that this option should be
used only when all parties to a dispute
agree that one arbitrator would be
insufficient.58 MGGA claims that a
panel of arbitrators would be better than
a single arbitrator.59 It suggests that,
upon agreement by both parties, the
54 Public
Hr’g Tr., 148–49, Aug. 2, 2012.
at 40.
56 NITL Comments 13, May 17, 2012.
57 Id.
58 Id.
59 MGGA Comments 2, May 17, 2012.
55 Id.
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Board should appoint the agency’s
arbitrator, and each party should choose
and pay for an additional arbitrator.60
During the public hearing, NGFA
supported a panel of three arbitrators. In
the NGFA’s experience, this improves
the likelihood of well-reasoned
decisions, enhances the balance and
fairness with which the system is
viewed, and reduces the potential for
inadvertent errors.61 ARC stated that
creating a panel of three arbitrators, in
which the railroad and shipper are both
represented by an arbitrator on the
panel, would eliminate the need to find
a single arbitrator who would be both
neutral and an industry expert.62 NITL
believed a single arbitrator to be more
cost effective, but that the parties should
have the option to select an arbitration
panel.63 Both NITL64 and WCTL65
expressed concerns regarding the costprohibitive nature of a panel of three
arbitrators in light of the $200,000
monetary award cap, the central
concern being that shippers seeking
small amounts of damages might be
frozen out of the arbitration process if
the Board were to mandate a threemember arbitration panel.
UP stated at the hearing that it views
three-member arbitration panels as a
solution to the problem of finding a
single-neutral arbitrator with subjectmatter expertise.66 UP stated that with
three arbitrators, and each of the parties
selecting someone it believes is
knowledgeable and able to explain the
issues, UP might be willing to accept a
third-neutral arbitrator with less
familiarity of the subject matter.67
The Board finds persuasive the
comments regarding the respective
benefits of both a panel of three
arbitrators and the use of a singleneutral arbitrator. The Board further
believes that a flexible program will be
the most useful to party participants.
The parties, and not the Board, are in
the best position to determine what will
work best in a particular arbitration
proceeding. The final rules, therefore,
allow the parties to shape individual
arbitrations to suit their specific needs
rather than creating a one-size-fits-all
arbitration program.
Under the final rules, a panel of three
arbitrators will be utilized unless the
parties agree in writing to the use of a
single neutral arbitrator. The Board
60 Id.
61 Public
Hr’g Tr., 20, Aug. 2, 2012.
at 56 & 72–73.
63 Id. at 42.
64 Id. at 84–85.
65 Id. at 85–86.
66 Id. at 141–42.
67 Public Hr’g Tr., 142, Aug. 2, 2012.
62 Id.
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believes that using a panel of three
arbitrators will alleviate the concerns
raised about finding a single-neutral
arbitrator with subject-matter expertise.
The parties in their comments and
testimony recognize that it would not be
overly difficult to appoint two subjectmatter experts as arbitrators who can
educate and guide the third-neutral
arbitrator.68 Thus, establishing a threemember arbitration panel, as a general
rule, will help to ensure the integrity
and neutrality of the arbitration
proceedings.
The Board also recognizes that it can
be appropriate to use a single-neutral
arbitrator in certain cases as a costeffective, expeditious choice for
resolving a dispute between the parties.
Thus, the final rules allow either party
to request the single-arbitrator option in
either the complaint or the answer. Both
parties, however, must consent to the
use of a single-neutral arbitrator in
writing for the option to be selected. If
no agreement is reached, the parties will
have the option of utilizing the panel of
three arbitrators or bringing the matter
formally before the Board and foregoing
the arbitration process.
Selecting Arbitrators and Cost Sharing
AAR suggests that the Board should
reassess how arbitrators will be
selected.69 If the Board were to maintain
the current roster system, AAR asks that
the Board initiate a public and
transparent process for updating the
list.70 It claims that the Board has no
apparent standards of qualifications for
arbitrators and no apparent vetting
process.71 AAR further asserts that the
Board should void the existing roster
and institute a proceeding to establish a
new list of arbitrators.72 In such a
proceeding, according to AAR, the
Board should establish objective criteria
to judge whether an individual could be
an effective arbitrator of Board-related
disputes.73 It proposes that such criteria
should include a minimum number of
years of transportation experience and
demonstrated neutrality.74
AAR further suggests that the Board
should establish clear procedures for
selecting the third-party neutral or
68 The final rules allow each party to appoint one
arbitrator who is intended to be a subject-matter
expert. The final rules place no restrictions on the
selection of this party-appointed arbitrator. A party
may appoint any individual that it believes has the
requisite qualifications to serve as an arbitrator,
including its employee, a choice that could reduce
the costs of arbitration.
69 AAR Comments 17–18, May 17, 2012.
70 Id. at 17.
71 Id. at 17.
72 Id.
73 Id.
74 Id. at 17–18.
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single arbitrator in a specific dispute.75
It proposes that, if the parties cannot
agree on an arbitrator, the Board could
establish a ‘‘best-final offer’’ process
where each party would submit the
name of each arbitrator to the Board
with reasons backing that choice.76 The
Board could then select one of the
two.77 WCTL and NITL propose a
similar process for the Board to select an
arbitrator.78
At the hearing, UP speculated that
one reason why the Board’s arbitration
procedures have not been used in the
past may be the quality of the available
list of arbitrators.79 UP noted that, in
other arbitration settings, it can quickly
assess the qualifications and neutrality
of an arbitrator. Typically, UP and the
opposing party can each select an
arbitrator and then either mutually agree
on a third arbitrator or utilize a neutral
arbitration organization to supply a list
of potential arbitrators complete with
extensive background information.80
The Board recognizes that its current
list of arbitrators is outdated and does
not provide the type of information the
parties have expressed an interest in
knowing prior to an arbitrator’s
appointment. The selection process
could also have been made clearer. The
Board has incorporated the suggestions
and best practices identified by the
parties into the final rules to create a
streamlined, party-driven arbitrator
selection process, and will therefore no
longer maintain a roster or list of
arbitrators.
The Board will provide the parties
with a list of five neutral arbitrators to
facilitate the selection of a third-neutral
arbitrator, or a single-neutral arbitrator if
the parties so agree in writing. The
neutral arbitrator is intended to be an
arbitration-process expert, rather than a
subject-matter expert. When individual
arbitration proceedings arise, the Board
will obtain a list of potential arbitrators
from professional arbitration
associations such as the American
Arbitration Association, Judicial
Arbitration and Mediation Services
(JAMS), and the Federal Mediation and
Conciliation Service. The Board believes
that these professional arbitration
associations, with expansive and wellmaintained rosters, will be able to
provide a list of qualified-neutral
arbitrators to the Board upon request.
Utilizing the expertise of these
75 AAR
Comments 18, May 17, 2012.
76 Id.
77 Id.
78 WCTL Comments 10, May 17, 2012; and NITL
Comments 12, May 17, 2012.
79 Public Hr’g Tr., 121, Aug. 2, 2012.
80 Id. at 122.
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organizations should expedite and
improve the arbitrator selection process.
It was apparent from the comments and
testimony that the parties have had
experience utilizing arbitrators from
these organizations and have been
comfortable doing so. The list of neutral
arbitrators will be accompanied by a
detailed professional history of each
arbitrator. Parties to arbitration will split
all costs associated with the use of the
neutral arbitrator. The Board will pay all
costs associated with obtaining a list of
arbitrators from professional arbitration
associations.
To select the neutral arbitrator, the
Board has adopted a ‘‘strike’’
methodology in the final rules.
Specifically, after the Board obtains a
list of five neutral arbitrators, and
provides the list to the parties, the
complainant will be responsible for
striking one name from the list. The
respondent will then have the
opportunity to strike another name from
the list. The process will repeat until
only one name remains on the list: the
individual who will be the neutral
arbitrator. This selection should be
concluded in no more than 14 days from
the date the Board sends the arbitrator
list to the parties. Each party to
arbitration is responsible for conducting
its own due diligence on the list of
neutral arbitrators. The selection of the
neutral arbitrator will not be
challengeable before the Board. To
permit challenges to the strike
methodology would increase litigation
costs and lengthen the arbitration
process, which would contravene the
goals of the Board’s arbitration program.
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Arbitration Procedures
To carry out an effective arbitration
process for all parties, arbitration
proceedings must be conducted in a
timely yet thorough manner. The final
rules provide that when the parties
select a panel of three arbitrators, the
neutral arbitrator will establish all
arbitration procedures including
discovery, the submission of evidence,
and the treatment of confidential
information, and the evidentiary phase
of the arbitration process must be
completed within 90 days from the
established start date. The neutral
arbitrator will be required to issue an
unredacted written decision to the
parties on behalf of the arbitration panel
within 30 days following the
completion of the evidentiary phase.
The neutral arbitrator must serve a
redacted copy of the arbitration decision
upon the Board within 60 days of the
completion of the evidentiary phase.
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Publication of Decisions and
Precedential Value
Under the proposed rules, arbitration
decisions would not be made public in
order to promote parties’ willingness to
utilize the arbitration program. The
Board received comments and
testimony in opposition to this
proposal. AAR argues that making
arbitration awards public would have
three benefits: (1) Public decisions that
summarize the position of the parties
discourage extreme positions and can
encourage voluntary settlement; (2)
public decisions would create
incentives for arbitrators to render
thoughtful, well-reasoned decisions;
and (3) public decisions would allow
parties to make an informed decision in
selecting arbitrators based on their prior
work.81 As such, AAR proposes that
arbitrators should be required to render
written confidential decisions to the
parties involved in disputes and also a
shorter public summary of the decision
to be submitted to the Board for
publication on the Board’s Web site.82
At the public hearing, NITL stated that
it believes there are commercial
positives to publishing arbitration
decisions and that published decisions
add a layer of transparency to the
arbitration program.83 NITL also argued
that publishing decisions may ease
concerns about the program because
parties can see that other parties have
gone through the process before.84
NGFA stated that arbitration decisions
should be published but with
confidential materials redacted.85 NGFA
expressed the view that publishing
arbitration decisions would encourage
shippers and carriers to resolve disputes
prior to arbitration.86 UP suggested that
the Board should publish arbitration
decisions on the Board’s Web site in
order to ensure transparency of the
arbitration process.87
During the hearing, NITL stated that
published arbitration decisions should
have no precedential value.88 MGGA
also supports non-precedential
arbitration decisions.89 NGFA states
that, while arbitration decisions offer no
precedential value, they provide
considerable value as a published
guide.90 UP states that it would support
publication of arbitration decisions if
81 AAR
Reply 10–11, June 18, 2012.
at 11.
83 Public Hr’g Tr., 101, Aug. 2, 2012.
84 Id. at 93.
85 Id. at 21.
86 Id.
87 Id. at 124.
88 Id. at 43.
89 MGGA Comment 2, May 17, 2012.
90 NFGA Comment 9, May 17, 2012.
82 Id.
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they did not disclose confidential
information, are not precedential, and
are not admissible in future
arbitrations.91
Based on the parties’ comments, the
Board will require the publication of
arbitration decisions. The arbitrators
shall, with the help of the parties or
pursuant to the arbitration agreement,
redact from this decision all proprietary
or confidential information, and provide
the redacted copy to the Board within
60 days of the completion of the
evidentiary phase. The Board will then
publish the redacted decision on its
Web site. Arbitrators shall be required
in all cases to maintain an unredacted
copy of their decisions. In the event an
arbitration decision is appealed to the
Board, the neutral arbitrator shall be
required to serve upon the Board an
unredacted copy of the decision, but the
Board will consider this decision
confidential and will not post it on its
Web site. The Board will not publish
any proprietary or confidential
information. Although arbitration
decisions will be available on the
Board’s Web site, these decisions will
have no precedential value in any
proceeding including other mediations,
arbitrations, formal Board proceedings,
and court appeals of Board decisions.
Standard of Review
The Board stated in its proposed rules
that its standard of review of an arbitral
decision would be narrow and that
relief would be limited to instances
involving a clear abuse of arbitral
authority or discretion. BNSF asks the
Board to allow appeals on additional
grounds including that: (1) The
arbitrator has exceeded his or her
authority; (2) the arbitration award
contravenes statutory requirements;
and/or (3) the arbitrator has exhibited
partiality.92 BNSF argues that a party is
more likely to participate in the
arbitration program if it knows that the
standard of review is broad enough to
allow the Board to review and modify
or vacate an award that is clearly in
error or is issued under circumstances
where the arbitrator is biased or acts
outside his or her authority.93 BNSF
notes that this standard is similar to the
standard used to review arbitration
awards under the Federal Arbitration
Act.94
Other parties also support broadening
the standard of review. For example, UP
argues that one ground for appeal
should be that an arbitrator failed to
91 UP
Reply 10, June 18, 2012.
Comments 5, May 17, 2012.
92 BNSF
93 Id.
94 Id.
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disclose any relationship or dealing
between the arbitrator and a party or its
counsel.95 AAR proposes, at a
minimum, that the Board should add
the phrase ‘‘or contravenes statutory
requirements’’ to the proposed standard
of review.96 USDA suggests that parties
should be able to appeal the initial
arbitration decision to a proposed
review panel before seeking the Board’s
review of the arbitration decision,
except in instances involving a clear
abuse of arbitral authority or
discretion.97
NITL objects to these attempts to
expand the standard.98 It claims that the
standard should be narrow because a
broad standard could lead to frequent
and complex appeals and could
undercut a prime rationale for
arbitration in the first place.99 NITL
does, however, agree that the lack of
disclosure of an arbitrator’s relevant
relationship would be a sound reason
for appeal and that the Board should
broaden its standard to accommodate
that ground.100
Additionally, NGFA claims that,
because the proposed 49 CFR 1115.8(c)
would require an arbitrator to be guided
by the Interstate Commerce Act and by
STB and ICC precedent, on appeal a
party could argue that it was an abuse
of discretion for an arbitrator to depart
from an earlier Board or ICC decision.101
According to NGFA, this possibility
would significantly broaden the
standard proposed at § 1108.11(c).102
Therefore, NGFA asserts that the Board
should not instruct arbitrators to be
guided by prior Board or ICC decisions,
except for jurisdictional issues.103
WCTL questions NGFA’s suggestion.104
WCTL notes that, if the Board’s decision
were to uphold an arbitral award that
was contrary to established law, the
Board’s decision would be subject to
challenge in court under the Hobbs Act
(28 U.S.C. 2321, 2342).105
Upon petition by one or more parties
to the arbitration, the Board reserves the
right to review, modify, or vacate any
arbitration award. The final rules clarify
that the Board will apply a narrow
standard of review, but which is
somewhat broader than originally
proposed, and will grant relief only on
grounds that the award reflects a clear
95 UP
Comments 12, May 17, 2012.
Comments 18, May 17, 2012.
97 USDA Comments 3, May 17, 2012.
98 NITL Reply 21, June 18, 2012.
99 Id.
100 NITL Reply 22, June 18, 2012.
101 NGFA Comments 9–10, May 17, 2012.
102 NGFA Comments 10, May 17, 2012.
103 Id.
104 WCTL Reply 7, June 18, 2012.
105 Id.
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abuse of arbitral authority or discretion,
or directly contravenes statutory
authority. In response to BNSF’s
proposed standard of review, the Board
notes that, if arbitrators exceed their
authority or exhibit partiality, such
conduct is within the scope of the
adopted standard. The final rules
provide that, under this narrow
standard of review, arbitrators may be
guided by, but need not be bound by,
agency precedent.
The Board notes that the review
process adopted here is similar to the
arbitral review process established by
the Federal Energy Regulatory
Commission (FERC).106 FERC, like the
Board, is an independent regulatory
agency with a statutory mandate to
protect the public interest. We are
broadening our proposed standard of
review somewhat to help carry out our
statutory responsibility by ensuring that
arbitration decisions do not directly
contravene statutory authority. We
decline, however, further broadening
the Board’s standard of review because
such a detailed review process could
defeat the purpose of arbitration.
Judicial review of the Board’s
decision reviewing an arbitral decision
would be in the federal courts of
appeals under the Hobbs Act (28 U.S.C.
2321, 2342) and would apply
Administrative Procedure Act standards
of review. If the parties do not seek the
Board’s appellate review of an arbitral
decision, they would have the right to
appeal the arbitral award directly to a
federal district court, under the Federal
Arbitration Act, 9 U.S.C. 9–13.
Mediation
In the NPRM, the Board proposed
new mediation rules under which the
Board could order parties to participate
in mediation of certain types of
disputes, on a case-specific basis, and
sought to clarify and simply the existing
mediation procedures where parties to a
proceeding can voluntarily request the
Board to institute a mediation process to
attempt to resolve a dispute. The Board
also proposed to reserve the right to stay
underlying proceedings and toll any
applicable statutory deadlines for the
duration of the mediation.
Comments and testimony from the
parties regarding the Board’s proposed
revisions to its mediation rules at Part
1109 were generally positive, with only
one party objecting fully to the revised
rules.
At the public hearing, many of the
parties expressed their support for the
106 See generally Alternative Dispute Resolution,
60 FR 19494, 19499–500 (April 19, 1995) (codified
at 18 CFR 385.605 (Rule 605)) (describing FERC’s
arbitral review process).
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proposed mediation program. NGFA
stated that it supports the proposed
rules.107 NITL expressed its support for
the Board’s proposal to order parties to
mediation at the request of one party, or
at the Board’s own initiative except in
matters involving regulatory approvals
and for labor disputes.108 NITL believed
the proposed 30-day mediation period
and the option to extend the mediation
period are reasonable.109 ARC stated
that mediation could be one of the most
important and useful steps for resolving
disputes going forward.110 Tom
O’Connor stated that he had positive
experiences with Board-sponsored
mediation in the past, and that he
supports continued and expanded use
of mediation at the Board.111 NS also
expressed its support for voluntary
mediation provided it remains
confidential and inadmissible in formal
Board proceedings.112
In its comments, UP states that it does
not object to the new mediation
proposals, but it suggests that
‘‘applicable statutory deadlines’’ be
clarified to read ‘‘statutory deadlines
imposed on the Board under the
Interstate Commerce Act’’ so that it is
clear that the Board cannot toll
limitations and deadlines established by
other federal or state statutes.113
Similarly, in its comments AAR
expresses concerns that the Board does
not have the authority to toll statutes of
limitations on the collection of
payments in the courts and that such
statutes could run while mediation is
ordered by the Board without consent of
the parties.114 It asks that the Board
clarify its authority to toll statutory
deadlines while mediation is ongoing.
Additionally, AAR questions what
authority the Board has to compel
mediation without obtaining the
consent of the parties.115
WCTL supports many of the
mediation regulations proposed by the
Board. It does claim, however, that the
proposed regulations contain
confidentiality provisions that differ
somewhat from the confidentiality
provisions the Board employs in SAC
cases.116 WCTL argues that the existing
confidentiality provisions applying to
SAC cases have been effective, and that
the Board should consider applying
those confidentiality provisions as part
107 Public
Hr’g Tr., 17, Aug. 2, 2012.
at 28.
109 Id. at 29.
110 Id. at 54.
111 Id. at 58.
112 Id. at 115.
113 UP Comments 12, May 17, 2012.
114 AAR Comments 21–22, May 17, 2012.
115 Id. at 21.
116 WCTL Comments 6, May 17, 2012.
108 Id.
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of its new rules to be applied to all
cases, or at least consider eliminating
the document-destruction requirement
contained in proposed rule
§ 1109.3(f)(1).117
The UTU–NY opposes the proposed
changes to the mediation rules. It
objects to the scope of the mediation
proposal, and argues that mediation
should not be available in labormanagement disputes because they are
better left to other agencies, statutes, or
private resolution.118
Having considered the comments and
testimony of the parties, the Board
revises its rules at Part 1109 to allow the
Board to order mediation in certain
types of disputes (those in which the
Board is not required to grant or deny
a license or other regulatory approval or
exemption, and those that do not
involve labor protection) before the
Board. The final rules also permit the
Board to institute mediation at the
mutual request of all parties to a
dispute. The Board may also order the
parties to participate in mediation of a
dispute when requested by only one
party to the proceeding or on the
Board’s own initiative. Authority to
grant voluntary mediation requests is
delegated to the Director of the Board’s
Office of Proceedings. The Board may
compel mediation or grant a mediation
request at any time in an eligible
proceeding.119 The Board will appoint
one or more Board employees with
mediation training, unless the parties
mutually agree to a non-Board mediator
and so inform the Board. If the parties
use a non-Board mediator, they shall
mutually assume responsibility for
paying the fees and/or costs of the
mediator. Mediation periods shall last
for up to 30 days, although this time
may be extended upon the mutual
request of the parties. The Board will
remove the confidentiality requirement
that parties and mediators destroy all
mediation related notes at the
conclusion of mediation. The Board
reserves the right to stay proceedings
and toll any applicable statutory
deadlines pending the conclusion of a
30-day mediation period when all
parties voluntarily consent to
mediation. The Board will not stay
proceedings or toll applicable statutory
deadlines where one or more parties
does not voluntarily consent to
mediation or as provided in the rules
governing rate cases.120
117 Id.
118 UTU–NY
Comments 8, May 17, 2012.
to 49 CFR 1109.4, mediation must
occur soon after the filing of a complaint in rate
reasonable cases.
120 See 49 CFR part 1111.
119 Pursuant
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The proposed rules, which would
govern both the use of mediation and
arbitration in Board proceedings, are set
forth in Appendix A.
Regulatory Flexibility Act
The Regulatory Flexibility Act of 1980
(RFA), 5 U.S.C. 601–612, generally
requires a description and analysis of
rules that would have significant
economic impact on a substantial
number of small entities. In drafting a
rule, an agency is required to: (1) Assess
the effect that its regulation would have
on small entities; (2) analyze effective
alternatives that might minimize a
regulation’s impact; and (3) make the
analysis available for public comment. 5
U.S.C. 601–604. Under § 605(b), an
agency is not required to perform an
initial or final regulatory flexibility
analysis if it certifies that the proposed
or final rules will not have a ‘‘significant
impact on a substantial number of small
entities.’’
Insofar as the goal of the RFA is to
reduce the cost to small entities of
complying with federal regulations, the
RFA requires an agency to perform a
regulatory flexibility analysis of small
entity impacts only when a rule directly
regulates those entities. In other words,
the impact must be a direct impact on
small entities ‘‘whose conduct is
circumscribed or mandated’’ by the
proposed rule. White Eagle Coop. Ass’n
v. Conner, 553 F.3d 467, 480 (7th Cir.
2009). An agency has no obligation to
conduct a small entity impact analysis
of effects on entities that it does not
regulate. United Dist. Cos. v. FERC, 88
F.3d 1105, 1170 (D.C. Cir. 1996).
These final rules clarify and simplify
the existing procedures for two
alternative dispute resolution processes
to formal adjudications before the
Board. First, the rules permit carriers
and shippers to agree voluntarily to
resolve certain kinds of disputes before
the Board under a newly-defined
arbitration program. Second, the rules
permit parties to agree voluntarily, and
sometimes could require parties, to
mediate certain kinds of disputes before
the Board.
Although these alternative dispute
resolution processes are available to all
rail carriers, including small entities,121
these rules will not have a significant
impact on a substantial number of small
entities. For the most part, these final
121 The Small Business Administration’s Office of
Size Standards has established a size standard for
rail transportation, pursuant to which a line-haul
railroad is considered small if its number of
employees is 1,500 or less, and a short line railroad
is considered small if its number of employees is
500 or less. 13 CFR 121.201 (industry subsector
482).
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rules provide for voluntary mediation
and arbitration. Regulated entities are
not required to engage in additional
regulatory compliance as the procedures
are optional. Even in the case of Boardordered mediation, there are no
additional regulatory compliance
requirements as mediation will be
conducted pursuant to a formal
complaint filed with the Board. Under
the final rules, any resolution reached
through mediation would be the result
of the mutual agreement of the parties,
including small entities, not as a result
of a Board-imposed decision. With
respect to arbitration, which is entirely
voluntary, that process is designed to
consume less time and be less costly
than formal complaint proceedings, thus
permitting the parties to obtain relief at
a greater net value. To the extent that
these final rules have any impact, it is
expected to result in faster resolution of
controversies before the Board at a
lower cost. Therefore, the Board certifies
under 5 U.S.C. 605(b) that these rules
will not have a significant economic
impact on a substantial number of small
entities within the meaning of the RFA.
Paperwork Reduction Act
In a supplemental Federal Register
notice, published at 77 FR 23208 on
April 8, 2012, the Board sought
comments pursuant to the Paperwork
Reduction Act (PRA), 44 U.S.C. 3501–
3549, and Office of Management and
Budget (OMB) regulations at 5 CFR
1320.11, regarding: (1) Whether the
collection of information associated
with the proposed arbitration program is
necessary for the proper performance of
the functions of the Board, including
whether the collection has practical
utility; (2) the accuracy of the Board’s
burden estimates; (3) ways to enhance
the quality, utility, and clarity of the
information collected; and (4) ways to
minimize the burden of the collection of
information on the respondents,
including the use of automated
collection techniques or other forms of
information technology, when
appropriate. None of the comments
received specifically referenced these
questions. Several of the comments
discussed above, however, could be
viewed to argue that requiring opt-in
letters would be more practical and less
burdensome than requiring opt-out
letters and the final rule adopts that
change.
The proposed rules were submitted to
OMB for review as required under the
PRA, 44 U.S.C. 3507(d), and 5 CFR
1320.11. No comments were received
from OMB, which assigned to the
collection Control No. 2140–0020. The
display of a currently valid OMB control
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number for this collection is required by
law. Under the PRA and 5 CFR 1320.11,
an agency may not conduct or sponsor,
and a person is not required to respond
to, a collection of information unless the
collection displays a currently valid
OMB control number. As required,
simultaneously with the publication of
this final rule, the Board is submitting
this modified collection to OMB for
review.
This action will not significantly
affect either the quality of the human
environment or the conservation of
energy resources.
This rulemaking will affect the
following subjects: §§ 1002.2, 1011.7,
1108, 1109.1, 1109.2, 1109.3, 1111.10,
and 1115.8, of title 49, chapter X, of the
Code of Federal Regulations. It is issued
subject to the Board’s authority under
49 U.S.C. 721(a).
It is ordered:
1. The Board adopts the final rules as
set forth in this decision. Notice of the
adopted rules will be published in the
Federal Register.
2. This decision is effective 30 days
after the day of service.
Raina S. White,
Clearance Clerk.
List of Subjects
49 CFR Part 1002
Administrative practice and
procedure, Common carriers, Freedom
of information.
49 CFR Part 1011
Administrative practice and
procedure, Authority delegations
(Governmnent agencies), Organization
and functions (Government agencies).
49 CFR Part 1108
Administrative practice and
procedure, Railroads.
PART 1002—FEES
1. The authority citation for part 1002
is revised to read as follows:
■
Authority: 5 U.S.C. 552(a)(4)(A) and 553;
31 U.S.C. 9701; and 49 U.S.C. 721. Section
1002.1(g)(11) is also issued under 5 U.S.C.
5514 and 31 U.S.C. 3717.
2. Amend § 1002.2 by revising
paragraphs (f)(87) and (f)(88) to read as
follows:
■
§ 1002.2
*
*
■
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*
Fee
*
*
*
*
*
*
(87) Arbitration of Certain Disputes
Subject to the Statutory Jurisdiction of the Surface Transportation Board under 49 CFR part
1108:
(i) Complaint
(ii) Answer (per defendant), Unless Declining to Submit to
Any Arbitration
(iii) Third Party Complaint
(iv) Third Party Answer (per defendant), Unless Declining to
Submit to Any Arbitration
(v) Appeals of Arbitration Decisions or Petitions to Modify or
Vacate an Arbitration Award
(88) Basic fee for STB adjudicatory
services not otherwise covered
49 CFR Part 1111
Administrative practice and
procedure, Investigations.
For the reasons set forth in the
preamble, the Surface Transportation
PART 1108—ARBITRATION OF
CERTAIN DISPUTES SUBJECT TO THE
STATUTORY JURISDICTION OF THE
SURFACE TRANSPORTATION BOARD
*
Part VI: Informal Proceedings
*
Decided: May 10, 2013.
By the Board, Chairman Elliott, Vice
Chairman Begeman, and Commissioner
Mulvey.
Jeffrey Herzig,
Clearance Clerk.
*
*
*
*
*
*
*
*
*
*
$75
75
75
75
150
250
*
*
3. The authority citation for part 1011
continues to read as follows:
Authority: 5 U.S.C. 553; 31 U.S.C. 9701; 49
U.S.C. 701, 721, 11123, 11124, 11144, 14122,
and 15722.
4. Amend § 1011.7 by adding
paragraphs (a)(2)(xvii), (a)(2)(xviii), and
(a)(2)(xix) to read as follows:
■
§ 1011.7 Delegations of authority by the
Board to specific offices of the Board.
(a) * * *
(2) * * *
(xvii) To authorize parties to a
proceeding before the Board, upon
mutual request, to participate in
Frm 00061
Fmt 4700
Sfmt 4700
Sec.
1108.1 Definitions.
1108.2 Statement of purpose, organization,
and jurisdiction.
1108.3 Participation in the Board’s
arbitration program.
1108.4 Use of arbitration.
1108.5 Arbitration commencement
procedures.
1108.6 Arbitrators.
1108.7 Arbitration procedures.
1108.8 Relief.
1108.9 Decisions.
1108.10 Precedent.
1108.11 Enforcement and appeals.
1108.12 Fees and costs.
1108.13 Additional parties per side.
Authority: 49 U.S.C. 721(a) and 5 U.S.C.
571 et seq.
§ 1108.1
PART 1011—BOARD ORGANIZATION;
DELEGATIONS OF AUTHORITY
PO 00000
meditation with a Board-appointed
mediator, for a period of up to 30 days
and to extend the mediation period at
the mutual request of the parties.
(xviii) To authorize a proceeding to be
held in abeyance while mediation
procedures are pursued, pursuant to the
mutual request of the parties to the
matter.
(xix) To order arbitration of programeligible matters under the Board’s
regulations at 49 CFR part 1108, or upon
the mutual request of parties to a
proceeding before the Board.
*
*
*
*
*
■ 5. Revise part 1108 to read as follows:
Filing fees.
*
*
(f) * * *
Type of proceeding
49 CFR Part 1109
Administrative practice and
procedure, Maritime carriers, Motor
carriers, Railroads.
49 CFR Part 1115
Administrative practice and
procedure.
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Board amends parts 1002, 1011, 1108,
1109, 1111, and 1115 of title 49, chapter
X, of the Code of Federal Regulations as
follows:
29079
Definitions.
As used in this part:
(a) Arbitrator means a single person
appointed to arbitrate pursuant to these
rules.
(b) Arbitrator Panel means a group of
three people appointed to arbitrate
pursuant to these rules. One panel
member would be selected by each side
to the arbitration dispute, and the
parties would mutually agree to the
selection of the third-neutral arbitrator
under the ‘‘strike’’ methodology
described in § 1108.6(c).
(c) Arbitration program means the
program established by the Surface
Transportation Board in this part under
which participating parties, including
rail carriers and shippers, have agreed
voluntarily in advance, or on a case-bycase basis to resolve disputes about
arbitration-program-eligible matters
brought before the Board using the
Board’s arbitration procedures.
(d) Arbitration-program-eligible
matters are those disputes or
components of disputes, that may be
resolved using the Board’s arbitration
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program and include disputes involving
one or more of the following subjects:
Demurrage; accessorial charges;
misrouting or mishandling of rail cars;
and disputes involving a carrier’s
published rules and practices as applied
to particular rail transportation.
(e) Counterclaim is an independent
arbitration claim filed by a respondent
against a complainant arising out of the
same set of circumstances or is
substantially related to the underlying
arbitration complaint and subject to the
Board’s jurisdiction.
(f) Final arbitration decision is the
unredacted decision served upon the
parties 30 days after the close of the
arbitration’s evidentiary phase.
(g) Interstate Commerce Act means
the Interstate Commerce Act as
amended by the ICC Termination Act of
1995.
(h) Monetary award cap means a limit
on awardable damages of $200,000 per
case, unless the parties mutually agree
to a different award cap. If parties bring
one or more counterclaims, such
counterclaims will be subject to a
separate monetary award cap of
$200,000 per case, unless the parties
mutually agree to a different award cap.
(i) Neutral Arbitrator means the
arbitrator selected by the strike
methodology outlined in § 1108.6(c).
(j) Statutory jurisdiction means the
jurisdiction conferred on the STB by the
Interstate Commerce Act, including
jurisdiction over rail transportation or
services that have been exempted from
regulation.
(k) STB or Board means the Surface
Transportation Board.
wreier-aviles on DSK5TPTVN1PROD with RULES
§ 1108.2 Statement of purpose,
organization, and jurisdiction.
(a) The Board’s intent. The Board
favors the resolution of disputes through
the use of mediation and arbitration
procedures, in lieu of formal Board
proceedings, whenever possible. This
section provides for the creation of a
binding, voluntary arbitration program
in which parties, including shippers
and railroads, agree in advance to
arbitrate certain types of disputes with
a limit on potential liability of $200,000
unless the parties mutually agree to a
different award cap. The Board’s
arbitration program is open to all parties
eligible to bring or defend disputes
before the Board.
(1) Except as discussed in paragraph
(b) of this section, parties to arbitration
may agree by mutual written consent to
arbitrate additional matters and to a
different amount of potential liability
than the monetary award cap identified
in this section.
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(2) Nothing in these rules shall be
construed in a manner to prevent parties
from independently seeking or utilizing
private arbitration services to resolve
any disputes they may have.
(b) Limitations to the Board’s
Arbitration Program. These procedures
shall not be available for disputes
involving labor protective conditions,
which have their own procedures.
These procedures shall not be available
to obtain the grant, denial, stay or
revocation of any license, authorization
(e.g., construction, abandonment,
purchase, trackage rights, merger,
pooling), or exemption related to such
matters. Parties may only use these
arbitration procedures to arbitrate
matters within the statutory jurisdiction
of the Board.
§ 1108.3 Participation in the Board’s
arbitration program.
(a) Opt-in procedures. Any rail
carrier, shipper, or other party eligible
to bring or defend disputes before the
Board may at any time voluntarily
choose to opt into the Board’s
arbitration program. Opting in may be
for a particular dispute or for all
potential disputes before the Board
unless and until the party exercises the
opt-out procedures discussed in
§ 1108.3(b). To opt in parties may either:
(1) File a notice with the Board, under
Docket No. EP 699, advising the Board
of the party’s intent to participate in the
arbitration program. Such notice may be
filed at any time and shall be effective
upon receipt by the Board.
(i) Notices filed with the Board shall
state which arbitration-program-eligible
issue(s) the party is willing to submit to
arbitration.
(ii) Notices may, at the submitting
party’s discretion, provide for a different
monetary award cap.
(2) Participants to a proceeding,
where one or both parties have not
opted into the arbitration program, may
by joint notice agree to submit an issue
in dispute to the Board’s arbitration
program.
(i) The joint notice must clearly state
the issue(s) which the parties are willing
to submit to arbitration and the
corresponding maximum monetary
award cap if the parties desire to
arbitrate for a different amount than the
Board’s $200,000 monetary award cap.
(b) Opt-out procedures. Any party
who has elected to participate in the
arbitration program may file a notice at
any time under Docket No. EP 699,
informing the Board of the party’s
decision to opt out of the program or
amend the scope of its participation.
The notice shall take effect 90 days after
filing and shall not excuse the filing
PO 00000
Frm 00062
Fmt 4700
Sfmt 4700
party from arbitration proceedings that
are ongoing, or permit it to withdraw its
consent to participate in any arbitrationprogram-eligible dispute associated with
their opt-in notice for any matter before
the Board at any time within that 90 day
period before the opt-out notice takes
effect
(c) Public notice of arbitration
program participation. The Board shall
maintain a list of participants who have
opted into the arbitration program on its
Web site at www.stb.dot.gov. Those
parties participating in arbitration on a
case-by-case basis will not be listed on
the Board’s Web site.
§ 1108.4
Use of arbitration.
(a) Arbitration-program-eligible
matters. Matters eligible for arbitration
under the Board’s program are:
Demurrage; accessorial charges;
misrouting or mishandling of rail cars;
and disputes involving a carrier’s
published rules and practices as applied
to particular rail transportation. Parties
may agree in writing to arbitrate
additional matters on a case-by-case
basis as provided in paragraph (e) of this
section.
(b) Monetary award cap. Arbitration
claims may not exceed the arbitration
program award cap of $200,000 per
arbitral proceeding unless:
(1) The defending party’s opt-in
notice provides for a different monetary
cap or;
(2) The parties agree to select a
different award cap that will govern
their arbitration proceeding. The parties
may change the award cap by
incorporating an appropriate provision
in their agreement to arbitrate.
(3) Counterclaims will not offset
against the monetary award cap of the
initiating claim. A counterclaim is an
independent claim and is subject to a
monetary award cap of $200,000 per
case, separate from the initiating claim,
or to a different cap agreed upon by the
parties in accordance with
§ 1108.4(b)(2).
(c) Assignment of arbitrationprogram-eligible matters. The Board
shall assign to arbitration all arbitrationprogram-eligible disputes arising in a
docketed proceeding where all parties to
the proceeding are participants in the
Board’s arbitration program, or where
one or more parties to the matter are
participants in the Board’s arbitration
program, and all other parties to the
proceeding request or consent to
arbitration.
(d) Matters partially arbitrationprogram-eligible. Where the issues in a
proceeding before the Board relate in
part to arbitration-program-eligible
matters, only those parts of the dispute
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related to arbitration-program-eligible
matters may be arbitrated pursuant to
the arbitration program, unless the
parties petition the Board in accordance
with paragraph (e) of this section to
include additional disputes.
(e) Other matters. Parties may petition
the Board, on a case-by-case basis, to
assign to arbitration disputes, or
portions of disputes, not listed as
arbitration-program-eligible matters.
This may include counterclaims and
affirmative defenses. The Board will not
consider for arbitration types of disputes
which are expressly prohibited in
§ 1108.2(b).
(f) Arbitration clauses. Nothing in the
Board’s regulations shall preempt the
applicability of, or otherwise supersede,
any new or existing arbitration clauses
contained in agreements between
shippers and carriers.
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§ 1108.5 Arbitration commencement
procedures.
(a) Complaint. Arbitration under these
rules shall commence with a written
complaint, which shall be filed and
served in accordance with Board rules
contained at part 1104 of this chapter.
Each complaint must contain a
statement that the complainant and the
respondent are participants in the
Board’s arbitration program pursuant to
§ 1108.3(a), or that the complainant is
willing to arbitrate voluntarily all or
part of the dispute pursuant to the
Board’s arbitration procedures, and the
relief requested.
(1) If the complainant desires
arbitration with a single-neutral
arbitrator instead of a three-member
arbitration panel, the complaint must
make such a request in its complaint.
(2) If the complainant is not a
participant in the arbitration program,
the complaint may specify the issues
that the complainant is willing to
arbitrate.
(3) If the complainant desires to set a
different amount of potential liability
than the $200,000 monetary award cap,
the complaint should specify what
amount of potential liability the
complainant is willing to incur.
(b) Answer to the complaint. Any
respondent must, within 20 days of the
date of the filing of a complaint, answer
the complaint. The answer must state
whether the respondent is a participant
in the Board’s arbitration program, or
whether the respondent is willing to
arbitrate the particular dispute.
(1) If the complaint requests
arbitration by a single-neutral arbitrator
instead of by an arbitration panel, the
answer must contain a statement
consenting to arbitration by a single-
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neutral arbitrator or an express rejection
of the request.
(i) The respondent may also initiate a
request to use a single-neutral arbitrator
instead of an arbitration panel.
(ii) Absent the parties agreeing to
arbitration through a single-neutral
arbitrator, the Board will assign the case
to arbitration by a panel of three
arbitrators as provided by § 1108.6(a)–
(c). The party requesting the singleneutral arbitrator shall at that time
provide written notice to the Board and
the other parties if it continues to object
to a three-member arbitration panel.
Upon timely receipt of the notice, the
Board shall the set the matter for formal
adjudication.
(2) When the complaint specifies a
limit on the arbitrable issues, the answer
must state whether the respondent is
willing to resolve those issues through
arbitration.
(i) If the answer contains an
agreement to arbitrate some but not all
of the arbitration issues in the
arbitration complaint, the complainant
will have 10 days from the date of the
answer to advise the respondent and the
Board in writing whether the
complainant is willing to arbitrate on
that basis.
(ii) Where the respondent is a
participant in the Board’s arbitration
program, the answer should further state
that the respondent has thereby agreed
to use arbitration to resolve all of the
arbitration-program-eligible issues in
the complaint. The Board will then set
the matter for arbitration, and provide a
list of arbitrators.
(3) When the complaint proposes a
different amount of potential liability,
the answer must state whether the
respondent agrees to that amount in lieu
of the $200,000 monetary award cap.
(c) Counterclaims. In answering a
complaint, the respondent may file one
or more counterclaims against the
complainant if such claims arise out of
the same set of circumstances or are
substantially related, and are subject to
the Board’s jurisdiction as provided in
§ 1108.2(b). Counterclaims are subject to
the assignment provisions contained in
§ 1108.4(c)–(e). Counterclaims are
subject to the monetary award cap
provisions contained in § 1108.4(b)(2)–
(3).
(d) Affirmative defenses. An answer to
an arbitration complaint shall contain
specific admissions or denials of each
factual allegation contained in the
complaint, and any affirmative defenses
that the respondent wishes to assert
against the complainant.
(e) Arbitration agreement. Prior to the
commencement of an arbitration
proceeding, the parties to arbitration
PO 00000
Frm 00063
Fmt 4700
Sfmt 4700
29081
together with the neutral arbitrator shall
create a written arbitration agreement,
which at a minimum will state with
specificity the issues to be arbitrated
and the corresponding monetary award
cap to which the parties have agreed.
The agreement may contain other
mutually agreed upon provisions.
(1) Any additional issues selected for
arbitration by the parties, that are not
outside the scope of these arbitration
rules as explained in § 1108.2(b), must
be subject to the Board’s statutory
authority.
(2) These rules shall be incorporated
by reference into any arbitration
agreement conducted pursuant to an
arbitration complaint filed with the
Board.
§ 1108.6
Arbitrators.
(a) Panel of arbitrators. Unless
otherwise requested in writing pursuant
to § 1108.5(a)(1), all matters arbitrated
under these rules shall be resolved by a
panel of three arbitrators.
(b) Party-appointed arbitrators. The
party or parties on each side of an
arbitration dispute shall select one
arbitrator, and serve notice of the
selection upon the Board and the
opposing party within 20 days of an
arbitration answer being filed.
(1) Parties on one side of an
arbitration proceeding may not
challenge the arbitrator selected by the
opposing side.
(2) Parties to an arbitration proceeding
are responsible for the costs of the
arbitrator they select.
(c) Selecting the neutral arbitrator.
The Board shall provide the parties with
a list of five neutral arbitrators within 20
days of an arbitration answer being
filed. When compiling a list of neutral
arbitrators for a particular arbitration
proceeding, the Board will conduct
searches for arbitration experts by
contacting appropriate professional
arbitration associations. The parties will
have 14 days from the date the Board
provides them with this list to select a
neutral arbitrator using a single strike
methodology. The complainant will
strike one name from the list first. The
respondent will then have the
opportunity to strike one name from the
list. The process will then repeat until
one individual on the list remains, who
shall be the neutral arbitrator.
(1) The parties are responsible for
conducting their own due diligence in
striking names from the neutral
arbitrator list. The final selection of a
neutral arbitrator is not challengeable
before the Board.
(2) The parties shall split the cost of
the neutral arbitrator.
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(3) The neutral arbitrator appointed
through the strike methodology shall
serve as the head of the arbitration panel
and will be responsible for ensuring that
the tasks detailed in §§ 1108.7 and
1108.9 are accomplished.
(d) Use of a single arbitrator. Parties
to arbitration may request the use of a
single-neutral arbitrator. Requests for
use of a single-neutral arbitrator must be
included in a complaint or an answer as
required in § 1108.5(a)(1). Parties to
both sides of an arbitration dispute must
agree to the use of a single-neutral
arbitrator in writing. If the singlearbitrator option is selected, the
arbitrator selection procedures outlined
in § 1108.6(c) shall apply.
(e) Arbitrator incapacitation. If at any
time during the arbitration process a
selected arbitrator becomes
incapacitated or is unwilling or unable
to fulfill his or her duties, a replacement
arbitrator shall be promptly selected by
either of the following processes:
(1) If the incapacitated arbitrator was
appointed directly by a party to the
arbitration, the appointing party shall,
without delay, appoint a replacement
arbitrator pursuant to the procedures set
forth in § 1108.6(b).
(2) If the incapacitated arbitrator was
the neutral arbitrator, the parties shall
promptly inform the Board of the
neutral arbitrator’s incapacitation and
the selection procedures set forth in
§ 1108.6(c) shall apply.
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§ 1108.7
Arbitration procedures.
(a) Arbitration evidentiary phase
timetable. Whether the parties select a
single arbitrator or a panel of three
arbitrators, the neutral arbitrator shall
establish all rules deemed necessary for
each arbitration proceeding, including
with regard to discovery, the submission
of evidence, and the treatment of
confidential information, subject to the
requirement that this evidentiary phase
shall be completed within 90 days from
the start date established by the neutral
arbitrator.
(b) Written decision timetable. The
neutral arbitrator will be responsible for
writing the arbitration decision. The
unredacted arbitration decision must be
served on the parties within 30 days of
completion of the evidentiary phase. A
redacted copy of the arbitration decision
must be served upon the Board within
60 days of the close of the evidentiary
phase for publication on the Board’s
Web site.
(c) Extensions to the arbitration
timetable. Petitions for extensions to the
arbitration timetable shall only be
considered in cases of arbitrator
incapacitation as detailed in § 1108.6(e).
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(d) Protective orders. Any party, on
either side of an arbitration proceeding,
may request that discovery and the
submission of evidence be conducted
pursuant to a standard protective order
agreement.
§ 1108.8
Relief.
(a) Relief available. An arbitrator may
grant relief in the form of monetary
damages to the extent they are available
under this part or as agreed to in writing
by the parties.
(b) Relief not available. No injunctive
relief shall be available in Board
arbitration proceedings.
§ 1108.9
Decisions.
(a) Decision requirements. Whether by
a panel of arbitrators or a single-neutral
arbitrator, all arbitration decisions shall
be in writing and shall contain findings
of fact and conclusions of law. The
neutral arbitrator shall provide an
unredacted draft of the arbitration
decision to the parties to the dispute.
(b) Redacting arbitration decision.
The neutral arbitrator shall also provide
the parties with a draft of the decision
that redacts or omits all proprietary
business information and confidential
information pursuant to any such
requests of the parties under the
arbitration agreement.
(c) Party input. The parties may then
suggest what, if any, additional
redactions they think are required to
protect against the disclosure of
proprietary and confidential
information in the decision.
(d) Neutral arbitrator authority. The
neutral arbitrator shall retain the final
authority to determine what additional
redactions are appropriate to make.
(e) Service of arbitration decision. The
neutral arbitrator shall serve copies of
the unredacted decision upon the
parties in accordance with the timetable
and requirements set forth in
§ 1108.7(b). The neutral arbitrator shall
also serve copies of the redacted
decision upon the parties and the Board
in accordance with the timetable and
requirements set forth in § 1108.7(b).
The arbitrator may serve the decision
via any service method permitted by the
Board’s regulations.
(f) Service in the case of an appeal. In
the event an arbitration decision is
appealed to the Board, the neutral
arbitrator shall, without delay and
under seal, serve upon the Board an
unredacted copy of the arbitration
decision.
(g) Publication of decision. Redacted
copies of the arbitration decisions shall
be published and maintained on the
Board’s Web site.
PO 00000
Frm 00064
Fmt 4700
Sfmt 4700
(h) Arbitration decisions are binding.
By arbitrating pursuant to these
procedures, each party agrees that the
decision and award of the arbitrator(s)
shall be binding and judicially
enforceable in any court of appropriate
jurisdiction, subject to the rights of
appeal provided in § 1108.11.
§ 1108.10
Precedent.
Decisions rendered by arbitrators
pursuant to these rules may be guided
by, but need not be bound by, agency
precedent. Arbitration decisions shall
have no precedential value and may not
be relied upon in any manner during
subsequent arbitration proceedings
conducted under the rules in this part.
§ 1108.11
Enforcement and appeals.
(a) Petitions to modify or vacate. A
party may petition the Board to modify
or vacate an arbitral award. The appeal
must be filed within 20 days of service
of a final arbitration decision, and is
subject to the page limitations of
§ 1115.2(d) of this chapter. Copies of the
appeal shall be served upon all parties
in accordance with the Board’s rules at
part 1104 of this chapter. The appealing
party shall also serve a copy of its
appeal upon the arbitrator(s). Replies to
such appeals shall be filed within 20
days of the filing of the appeal with the
Board, and shall be subject to the page
limitations of § 1115.2(d) of this chapter.
(b) Board’s standard of review. On
appeal, the Board’s standard of review
of arbitration decisions will be narrow,
and relief will be granted only on
grounds that the award reflects a clear
abuse of arbitral authority or discretion
or directly contravenes statutory
authority. Using this standard, the
Board may modify or vacate an
arbitration award in whole or in part.
(1) Board decisions vacating or
modifying arbitration decisions under
the Board’s standard of review are
reviewable under the Hobbs Act, 28
U.S.C. 2321 and 2342.
(2) Nothing in these rules shall
prevent parties to arbitration from
seeking judicial review of arbitration
awards in a court of appropriate
jurisdiction pursuant to the Federal
Arbitration Act, 9 U.S.C. 9–13, in lieu of
seeking Board review.
(c) Staying arbitration decision. The
timely filing of a petition for review of
the arbitral decision by the Board will
not automatically stay the effect of the
arbitration decision. A stay may be
requested under § 1115.3(f) of this
chapter.
(d) Enforcement. Parties seeking to
enforce an arbitration decision made
pursuant to the Board’s arbitration
program must petition a court of
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appropriate jurisdiction under the
Federal Arbitration Act, 9 U.S.C. 9–13.
§ 1108.12
Fees and costs.
(a) Filing fees. When parties use the
Board’s arbitration procedures to resolve
a dispute, the party filing the complaint
or an answer shall pay the applicable
filing fee pursuant to 49 CFR part 1002.
(b) Party costs. When an arbitration
panel is used, each party (or side to a
dispute) shall pay the costs associated
with the arbitrator it selects. The cost of
the neutral arbitrator shall be shared
equally between the opposing parties (or
sides) to a dispute.
(c) Single arbitrator method. If the
single arbitrator method is utilized in
place of the arbitration panel, the parties
shall share equally the costs of the
neutral arbitrator.
(d) Board costs. Regardless of whether
there is a single arbitrator or a panel of
three arbitrators, the Board shall pay the
costs associated with the preparation of
a list of neutral arbitrators.
§ 1108.13
Additional parties per side.
Where an arbitration complaint is
filed by more than one complainant in
a particular arbitration proceeding
against, or is answered or
counterclaimed by, more than one
respondent, these arbitration rules will
apply to the complainants as a group
and the respondents as a group in the
same manner as they will apply to
individual opposing parties.
■ 6. Revise Part 1109 to read as follows:
PART 1109—USE OF MEDIATION IN
BOARD PROCEEDINGS
Sec.
1109.1 Mediation statement of purpose,
organization, and jurisdiction.
1109.2 Commencement of mediation.
1109.3 Mediation procedures.
1109.4 Mandatory mediation in rate cases
to be considered under the stand-alone
cost methodology.
Authority: 49 U.S.C. 721(a) and 5 U.S.C.
571 et seq.
wreier-aviles on DSK5TPTVN1PROD with RULES
§ 1109.1 Mediation statement of purpose,
organization, and jurisdiction.
The Board favors the resolution of
disputes through the use of mediation
and arbitration procedures, in lieu of
formal Board proceedings, whenever
possible. Parties may seek to resolve a
dispute brought before the Board using
the Board’s mediation procedures.
These procedures shall not be available
in a regulatory proceeding to obtain the
grant, denial, stay or revocation of a
request for construction, abandonment,
purchase, trackage rights, merger,
pooling authority or exemption related
to such matters. The Board may, by its
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own order, direct the parties to
participate in mediation using the
Board’s mediation procedures. The
Board’s mediation program is open to
all parties eligible to bring or defend
matters before the Board.
§ 1109.2
Commencement of mediation.
(a) Availability of mediation.
Mediation may be commenced in a
dispute before the Board:
(1) Pursuant to a Board order issued
in response to a written request of one
or more parties to a matter;
(2) Where the Board orders mediation
by its own order; or
(3) In connection with a rate
complaint, as provided by § 1109.4 and
part 1111 of this chapter.
(b) Requests for mediation. Parties
wishing to pursue mediation may file a
request for mediation with the Board at
any time following the filing of a
complaint. Parties that use the Board’s
mediation procedures shall not be
required to pay any fees other than the
appropriate filing fee associated with
the underlying dispute, as provided at
49 CFR 1002.2. The Board shall grant
any mediation request submitted by all
parties to a matter, but may deny
mediation where one or more parties to
the underlying dispute do not consent
to mediation, or where the parties seek
to mediate disputes not eligible for
Board-sponsored mediation, as listed in
§ 1109.1.
§ 1109.3
Mediation procedures.
(a) Mediation model. The Chairman
will appoint one or more Board
employees trained in mediation to
mediate any dispute assigned for
mediation. Alternatively, the parties to
a matter may agree to use a non-Board
mediator if they so inform the Board
within 10 days of an order assigning the
dispute to mediation. If a non-Board
mediator is used, the parties shall share
equally the fees and/or costs of the
mediator. The following restrictions
apply to any mediator selected by the
Board or the parties:
(1) No person serving as a mediator
may thereafter serve as an advocate for
a party in any other proceeding arising
from or related to the mediated dispute,
including, without limitation,
representation of a party to the
mediation before any other federal court
or agency; and
(2) If the mediation does not fully
resolve all issues in the docket before
the Board, the Board employees serving
as mediators may not thereafter advise
the Board regarding the future
disposition of the remaining issues in
the docket.
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29083
(b) Mediation period. The mediation
period shall be 30 days, beginning on
the date of the first mediation session.
The Board may extend mediation for
additional periods of time not to exceed
30 days per period, pursuant to mutual
written requests of all parties to the
mediation proceeding. The Board will
not extend mediation for additional
periods of time where one or more
parties to mediation do not agree to an
extension. The Board will not order
mediation more than once in any
particular proceeding, but may permit it
if all parties to a matter mutually
request another round of mediation. The
mediator(s) shall notify the Board
whether the parties have reached any
agreement by the end of the 30-day
period.
(c) Party representatives. At least one
principal of each party, who has the
authority to bind that party, shall
participate in the mediation and be
present at any session at which the
mediator(s) request that principal to be
present.
(d) Confidentiality. Mediation is a
confidential process, governed by the
confidentiality rules of the
Administrative Dispute Resolution Act
of 1996 (ADRA) (5 U.S.C. 574). In
addition to the confidentiality rules set
forth in the ADRA, the Board requires
the following additional confidentiality
protections:
(1) All parties to Board sponsored
mediation will sign an Agreement to
Mediate. The Agreement to Mediate
shall incorporate these rules by
reference.
(2) As a condition of participation, the
parties and any interested parties
joining the mediation must agree to the
confidentiality of the mediation process
as provided in this section and further
detailed in an agreement to mediate.
The parties to mediation, including the
mediator(s), shall not testify in
administrative or judicial proceedings
concerning the issues discussed in
mediation, nor submit any report or
record of the mediation discussions,
other than the settlement agreement
with the consent of all parties, except as
required by law.
(3) Evidence of conduct or statements
made during mediation is not
admissible in any Board proceeding. If
mediation fails to result in a full
resolution of the dispute, evidence that
is otherwise discoverable may not be
excluded from introduction into the
record of the underlying proceeding
merely because it was presented during
mediation. Such materials may be used
if they are disclosed through formal
discovery procedures established by the
Board or other adjudicatory bodies.
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(e) Abeyance. Except as otherwise
provided for in § 1109.4(f) and part 1111
of this chapter, any party may request
that a proceeding be held in abeyance
while mediation procedures are
pursued. Any such request should be
submitted to the Chief, Section of
Administration, Office of Proceedings.
The Board shall promptly issue an order
in response to such requests. Except as
otherwise provided for in § 1109.4(g)
and part 1111 of this chapter, the Board
may also direct that a proceeding be
held in abeyance pending the
conclusion of mediation. Where both
parties to mediation voluntarily consent
to mediation, the period during which
any proceeding is held in abeyance shall
toll applicable statutory deadlines.
Where one or both parties to mediation
do not voluntarily consent to mediation,
the Board will not hold the underlying
proceeding in abeyance and statutory
deadlines will not be tolled.
(f) Mediated settlements. Any
settlement agreement reached during or
as a result of mediation must be in
writing, and signed by all parties to the
mediation. The parties need not provide
a copy of the settlement agreement to
the Board, or otherwise make the terms
of the agreement public, but the parties,
or the mediator(s), shall notify the Board
that the parties have reached a mutually
agreeable resolution and request that the
Board terminate the underlying Board
proceeding. Parties to the settlement
agreement shall waive all rights of
administrative appeal to the issues
resolved by the settlement agreement.
(g) Partial resolution of mediated
issues. If the parties reach only a partial
resolution of their dispute, they or the
mediator(s) shall so inform the Board,
and the parties shall file any
stipulations they have mutually
reached, and ask the Board to reactivate
the procedural schedule in the
underlying proceeding to decide the
remaining issues.
ground rules and the time and location
of any meeting.
(c) Party representatives. At least one
principal of each party, who has the
authority to bind that party, shall
participate in the mediation and be
present at any session at which the
mediator(s) requests that the principal
be present.
(d) Settlement. The mediator(s) will
work with the parties to try to reach a
settlement of all or some of their dispute
or to narrow the issues in dispute, and
reach stipulations that may be
incorporated into any adjudication
before the Board if mediation does not
fully resolve the dispute. If the parties
reach a settlement, the mediator(s) may
assist in preparing a written settlement
agreement.
(e) Confidentiality. The entire
mediation process shall be private and
confidential. No party may use any
concessions made or information
disclosed to either the mediator(s) or the
opposing party before the Board or in
any other forum without the consent of
the other party. The confidentiality
provision of § 1109.3(d) and the
mediation agreement shall apply to all
mediations conducted under this
section.
(f) Mediation period. The mediation
shall be completed within 60 days of the
appointment of the mediator(s). The
mediation may be terminated prior to
the end of the 60-day period only with
the certification of the mediator(s) to the
Board. Requests to extend mediation, or
to re-engage it later, will be entertained
on a case-by-case basis, but only if filed
by all interested parties.
(g) Procedural schedule. Absent a
specific order from the Board, the onset
of mediation will not affect the
procedural schedule in stand alone cost
rate cases set forth at 49 CFR 1111.8(a).
§ 1109.4 Mandatory mediation in rate
cases to be considered under the standalone cost methodology.
■
7. The authority citation for part 1111
continues to read as follows:
(a) Mandatory use of mediation. A
shipper seeking rate relief from a
railroad or railroads in a case involving
the stand-alone cost methodology must
engage in non-binding mediation of its
dispute with the railroad upon filing a
formal complaint under 49 CFR part
1111.
(b) Assignment of mediators. Within
10 business days after the shipper files
its formal complaint, the Board will
assign one or more mediators to the
case. Within 5 business days of the
assignment to mediate, the mediator(s)
shall contact the parties to discuss
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PART 1111—COMPLAINT AND
INVESTIGATION PROCEDURES
Authority: 49 U.S.C. 721, 10704, and
11701.
8. Amend § 1111.10 by revising
paragraph (b) to read as follows:
■
§ 1111.10
matters.
Meeting to discuss procedural
*
*
*
*
*
(b) Simplified standards complaints.
In complaints challenging the
reasonableness of a rail rate based on
the simplified standards, the parties
shall meet, or discuss by telephone or
through email, discovery and
procedural matters within 7 days after
the mediation period ends. The parties
PO 00000
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should inform the Board as soon as
possible thereafter whether there are
unresolved disputes that require Board
intervention and, if so, the nature of
such disputes.
PART 1115—APPELLATE
PROCEDURES
9. The authority citation for part 1115
continues to read as follows:
■
Authority: 5 U.S.C. 559; 49 U.S.C. 721.
■
10. Revise § 1115.8 to read as follows:
§ 1115.8 Petitions to review arbitration
decisions.
An appeal of right to the Board is
permitted. The appeal must be filed
within 20 days of a final arbitration
decision, unless a later date is
authorized by the Board, and is subject
to the page limitations of § 1115.2(d).
The STB’s standard of review of
arbitration decisions will be narrow,
and relief will be granted only on
grounds that the award reflects a clear
abuse of arbitral authority or discretion
or directly contravenes statutory
authority. The timely filing of a petition
will not automatically stay the effect of
the arbitration decision. A stay may be
requested under § 1115.3(f).
Note: The following appendix will not
appear in the Code of Federal Regulations.
Appendix—Surface Transportation
Board
Agreement To Mediate
(1) Purpose. The parties agree to engage in
mediation under the auspices of the Surface
Transportation Board.
(2) Commencement. The mediation process
commences once the Board assigns a case for
mediation.
(3) Termination. The mediator may stop
the mediation at any point if he or she feels
that an impasse has been reached. The
mediator will stop the mediation if he or she
can no longer maintain neutrality or cannot
perform his or her role in an ethical or
effective manner. The mediator will discuss
this decision with the parties.
(4) Authority and Representation. The
parties shall ensure that their representatives
in mediation sessions are vested with the
authority to negotiate and settle the issues
presented in the docketed proceeding.
(5) Scope. The parties are not required to
reach a settlement on the issues presented in
Docket No. llll. The parties may reach
an agreement on some or all of the issues.
The parties may engage in discussions and
agreements on issues not presented in the
docketed proceeding as may be necessary to
reach resolution on other issues.
(6) Procedures. Mediation will be governed
by the rules and procedures set forth at 49
CFR part 1109 and this agreement. The
Board’s rules governing mediation found at
49 CFR part 1109 are expressly incorporated
into this agreement by reference.
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(7) Role of the Mediator. The parties
understand that the mediators are to serve as
facilitators of the mediation process and are
not to give the parties advice. The parties
further understand that the mediators have
no authority to decide the case and are not
acting as an advocate or attorney for any
party. The mediators may, in their best
judgment, provide clarification of STB rules
and regulations. The parties understand that
they have a right to have legal representation
present at all mediation proceedings.
(8) Confidentiality. Mediation is a
privileged and confidential process, subject
to 49 CFR 1109.3(d) and 1109.4(e). The
parties agree that statements and documents
are to remain confidential.
(a) Statements. The parties and their
representatives agree that the mediation
sessions are confidential settlement
negotiations, which are not subject to
discovery. Therefore, the parties and their
representatives agree not to introduce in any
subsequent forum any statements made
during the mediation, unless a statement has
been properly obtained through a later
discovery process.
(b) Documents. The parties and their
representatives agree that the mediation
sessions are confidential settlement
negotiations, which are not subject to
discovery. Therefore, the parties and their
representatives agree not to introduce in any
subsequent forum any documents produced
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during the mediation, unless a document has
been properly obtained through a later
discovery process.
(c) Discovery Issues. The parties agree that
mediation shall not be used as a shield to
discovery in the event a settlement is not
reached. Information presented at mediation
that is otherwise discoverable shall remain so
regardless of the mediation process. The
parties agree not to subpoena the mediators
or the Board’s mediation program
administrator to produce any documents
prepared by or submitted to the mediators in
any future proceedings. The mediators and
the program administrator will not testify on
behalf of any party or submit any type of
report on the substance of the mediation.
(d) Exceptions to Confidentiality. The only
exceptions to confidentiality are those set
forth in 5 U.S.C. 574(a)–(b) of the
Administrative Dispute Resolution Act of
1996.
(9) Settlement. No party shall be bound by
anything said or done at the mediation unless
a written settlement agreement is prepared
and signed by all necessary parties. If a
settlement is reached on some or all of the
issues presented, the agreement shall be
reduced to writing. The parties are
responsible for reducing their agreements to
a written document, though the mediators
may assist the parties as necessary to reduce
verbal agreements to writing.
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29085
By signature we acknowledge that we have
read, understand and agree to the foregoing
Agreement to Mediate.
lllllllllllllllllllll
Mediation Participant
lllllllllllllllllllll
Date
lllllllllllllllllllll
Mediation Participant
lllllllllllllllllllll
Date
lllllllllllllllllllll
Mediation Participant
lllllllllllllllllllll
Date
lllllllllllllllllllll
Mediation Participant
lllllllllllllllllllll
Date
lllllllllllllllllllll
Mediator
lllllllllllllllllllll
Date
lllllllllllllllllllll
Mediator
lllllllllllllllllllll
Date
[FR Doc. 2013–11675 Filed 5–16–13; 8:45 am]
BILLING CODE 4915–01–P
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| File Type | application/pdf |
| File Modified | 2013-05-17 |
| File Created | 2013-05-17 |