Opinion ID: 6341392
Heading Depth: 3
Heading Rank: 2

Heading: “Concerned an Interline Movement”

Text: We turn first to the meaning of the statutory phrase “concerned an interline movement.” In interpreting a statute, this court begins “with the language of the statute itself” and, if necessary, “may turn to other customary statutory interpretation tools, including structure, purpose, and legislative history.” Genus Med. Techs. LLC v. FDA, 994 F.3d 12 631, 637 (D.C. Cir. 2021) (internal quotation marks and citations omitted). Before this court, Defendants argue that a discussion or agreement “concern[s] an interline movement” within the meaning of Section 10706 if the discussion or agreement “is about—that is, it has practical bearing on—the discussant railroads’ shared interline traffic.” Opening Br. of Appellants 33. On their read, this “is true regardless of how specific or general the discussion is, and regardless of whether the discussion might be said to concern other things too.” Id. at 3334. Defendants maintain that “many of the issues that matter for interline traffic also matter for single-line traffic,” and that “[n]obody has explained how interlining railroads could have a reasonable conversation about many essential topics—fuel costs among them—that would not also seem relevant (at least in hindsight) to all traffic.” Id. at 59-60. For their part, Plaintiffs contend that a discussion or agreement “concern[s] an interline movement” only if the discussion or agreement is “limited to interline movements and [does not] include single-line movements.” Redacted Br. for Pls.-Appellees 22. In Plaintiffs’ view, Defendants’ contrary interpretation “would transform a narrow evidentiary rule into a license for collusion on all rates.” Id. at 25. Neither party has it right. We hold that a discussion or agreement “concern[s] an interline movement” only if Defendants meet their burden of showing that the movements at issue are the participating rail carriers’ shared interline traffic. A discussion or agreement need not identify a specific shipper, shipments, or destinations to qualify for exclusion; more general discussions or agreements may suffice. For example, evidence of a discussion or agreement about policies applicable to all of the participating railroads’ shared interline traffic is excludable under Section 10706, provided the evidence satisfies the 13 statute’s other requirements and the court can identify the movements at issue as the carriers’ shared interline traffic. The same is true of discussions or agreements about the formation of the participating railroads’ interline agreements, as well as about their anticipated shared traffic. A single document may reference more than one discussion or agreement. See In re Rail Freight Fuel Surcharge Antitrust Litig., 520 F. Supp. 3d 1, 25 (D.D.C. 2021). Defendants acknowledge that this is so. See Opening Br. of Appellants 74-75. The court must consider each discussion and agreement separately in determining whether it should be excluded under Section 10706. Consistent with the foregoing interpretation of the statute, evidence of discussions or agreements about single-line traffic or about freight traffic generally is not excludable under Section 10706. A de minimis (i.e., brief and insignificant) reference to non-interline traffic does not automatically disqualify evidence from exclusion under Section 10706. Instead, evidence of discussions or agreements about identifiable interline movements that also contain a de minimis reference to other traffic can qualify for exclusion under Section 10706 if the carriers demonstrate that the reference was either fleeting and inconsequential or appropriate to the advancement of the interline discussion itself. To carry this burden, the railroads must demonstrate that any such reference did not change the focus of the discussion or agreement away from the participating railroads’ shared, identifiable interline movements. Our construction of Section 10706 reflects the most natural reading of the statute’s text. Rail freight traffic involves two discrete types of movements: interline and single-line, see Br. for the United States and the FTC as Amici Curiae in Support of Pls.-Appellees and Affirmance 1, 11, and all parties before this court agree that the term “concerned” as it appears 14 in the statute is synonymous with “about,” see Opening Br. of Appellants 53 n.4; Redacted Br. for Pls.-Appellees 26; Reply Br. of Appellants 22. Congress used “concerned” to connect “discussion or agreement” with “an interline movement,” indicating that a discussion or agreement does not “concern[] an interline movement” if the discussion or agreement is about single-line traffic or rail freight generally. Reading “concerned an interline movement” to encompass discussions or agreements about a mutually inconsistent category – i.e., single-line movements – defies logic. Our interpretation is also consistent with the Act’s purpose. The Act states that, “[i]n regulating the railroad industry,” the Government’s policy is “to allow, to the maximum extent possible, competition and the demand for services to establish reasonable rates for transportation by rail.” 49 U.S.C. § 10101(1); see also ICC v. Texas, 479 U.S. 450, 460 (1987) (“In its statement of rail transportation policy, Congress unambiguously expressed its interest in allowing free competition, to the maximum extent possible, to govern the financial health of the railroad industry.”). Adopting an expansive interpretation of “concern[s] an interline movement” would render Section 10706 “little more than a de facto immunity for anticompetitive actions that happen to coincide with interline traffic.” Br. for the United States and the FTC as Amici Curiae in Support of Pls.-Appellees and Affirmance 13 (internal quotation marks omitted). We decline to adopt an interpretation of the statute so clearly at odds with Congress’ intent. At the same time, Section 10706, by its plain terms, evinces Congress’ clear desire to allow rail carriers to collaborate with one another about their shared interline traffic. In addition to promulgating the rule of evidence at issue here, the statute provides that proof of a conspiracy “may not be 15 inferred from evidence that two or more rail carriers acted together with respect to an interline rate or related matter and that a party to such action took similar action with respect to a rate or related matter on another route or traffic.” § 10706(a)(3)(B)(ii); see also H.R. Rep. No. 96-1430, at 114 (1980) (“[C]arriers must talk to competitors about interline movements in which they interchange. That requirement could falsely lead to conclusions about rate agreements that were lawfully discussed.”). Interpreting Section 10706 to require discussions or agreements to contain shipment-by-shipment specificity, or to strip rail carriers of the statute’s protections based solely on a de minimis reference to non-interline traffic, would significantly frustrate the statute’s objective. Finally, the statute’s use of the singular phrase “an interline movement” should be interpreted to include multiple movements. See 1 U.S.C. § 1 (“In determining the meaning of any Act of Congress, unless the context indicates otherwise—words importing the singular include and apply to several persons, parties, or things.”). That reinforces our conclusion that more general discussions or agreements about all interline traffic are excludable under Section 10706. Defendants’ principal counterargument to the reading of “concerned an interline movement” we adopt is that our interpretation renders superfluous the second clause of Section 10706. Under that clause, evidence of a discussion or agreement “concern[ing] an interline movement” is inadmissible only if “the discussion or agreement would not, considered by itself, violate the [antitrust] laws.” § 10706(a)(3)(B)(ii)(II). On Defendants’ read, discussions and agreements about participating carriers’ shared, identifiable interline movements “are never unlawful (at least outside the most contrived hypotheticals).” Opening Br. of Appellants 61. Therefore, they contend, the “paradoxical result,” id., of our construction is that no discussion “concern[ing] an interline 16 movement” could ever, “considered by itself, violate the [antitrust] laws,” § 10706(a)(3)(B)(ii)(II). We are not persuaded. As the Government’s amicus brief explains, a discussion or agreement can both “concern[] an interline movement” consistent with our interpretation and violate antitrust laws. See Br. for the United States and the FTC as Amici Curiae in Support of Pls.-Appellees and Affirmance 18-19. For example, a larger carrier might pressure a smaller carrier into accepting an unreasonably low share of interline profits under threat of losing access to interline business. See, e.g., Del. & Hudson Ry. Co. v. Consol. Rail Corp., 902 F.2d 174, 177-81 (2d Cir. 1990) (holding that a smaller rail carrier presented genuine issues of material fact with respect to its antitrust claims against a larger carrier where the larger carrier “placed [the smaller carrier] in a bind between giving up almost all of its profits on a given route and losing entirely the ability to carry freight on the route”). Accordingly, the “considered by itself” clause retains full force under our reading of the statute.