B.C.D. 00-11

Employer Status Determination

Penn Virginia Corporation

MAY 0 8 2000

This is the decision of the Railroad Retirement Board regarding the status of

Penn Virginia Corporation as an employer under the Railroad Retirement and

Railroad Unemployment Insurance Acts.

Penn Virginia is a publicly held company. As of March 5, 1999, it had 847

shareholders which held 8,369,289 shares of common stock. Penn Virginia is

engaged in the exploration, development, and production of oil and natural gas,

and the collection of royalties and overriding royalty interests on various oil 

and gas properties, and the leasing of coal mineral rights and the collection of

related royalties. Penn Virginia holds 3,307,200 shares in Norfolk Southern

Corporation, an employer under the Acts (B.A. No. 9408). Penn Virginia also

owns Kanawha Rail Corporation. Kanawha filed a notice of exemption with the

Surface Transportation Board in connection with its acquisition from Winiftede

Railroad Company of 6.47 miles of rail trackage in West Virginia, together with

associated rail properties (STB Finance Docket No. 33783, July 23, 1999). Penn

Virginia also indirectly owns the Powell River Railroad Company. The

employer status of both Kanawha and Powell River are currently being

investigated for submission to the Board.

Section 1(a)(1) ofthe Railroad Retirement Act (45 U.S.C. § 231(l)(a)(l)), insofar

as relevant here, defines a covered employer as:

(i) any carrier by railroad subject to the jurisdiction ofthe

Surface Transportation Board under Part A ofsubtitle IV oftitle

49, United States Code;

(ii) any company which is directly or indirectly owned or

controlled by, or under common control with, one or more

employers as defined in paragraph (i) ofthis subdivision, and

which operates any equipment or facility or performs any service

(except trucking service, casual service, and the casual operation of

equipment or facilities) in connection with the transportation of

passengers or property by railroad * * *.

Sections 1(a) and 1(b) ofthe Railroad Unemployment Insurance Act (45 U.S.C.

§§ 351(a) and (b)) contain substantially similar definitions, as does section 3231

of the Railroad Retirement Tax Act (26 U.S.C. § 3231).
Penn Virginia Corporation

Penn Virginia clearly is not a carrier by rail. In addition, there is no evidence

that it provides any services in connection with rail transportation. Further, in

Union Pacific Corporation v. United States. 5 F.3d 523 (Fed Cir. 1993), the

United States Court of Appeals for the Federal Circuit held that a parent

corporation which owns a rail carrier subsidiary is not under common control

with the subsidiary within the meaning of § 3231 of that Act. The relevant facts

ofthe Union Pacific case are indistinguishable from those presented by Penn

Virginia. Accordingly, a majority of the Board, Labor Member dissenting,

determines that Penn Virginia is not under common control with its

subsidiaries. Because Penn Virginia does not have any of the characteristics of

an “employer”, under any of the definitions of that term in the Railroad

Retirement and Railroad Unemployment Insurance Acts, the Board finds that

Penn Virginia is not an employer under those Acts.

Qt.

V. M. Speakman, Jr. (Concurring

opinion attached)
Opinion of

V. M. Speakman, Jr.

On Employer Status Determination of

Penn Virginia Corporation

I agree that Perm Virginia Corporation is not a carrier by rail and that there is no evidence

that it provides any services in connection with rail transportation. I disagree with the

majority ofthe Board’s determination and that ofthe United States Court of Appeals that

a parent corporation, which owns a rail carrier subsidiary is not under common control

with the subsidiary.

However, because Penn Virginia Corporation is not a carrier by rail and is not providing

services in connection with rail transportation, I agree that it is not an employer.

V. M. Speakman, Jr.

Date