Court Opinion

ID: 4280311
Source: CourtListenerOpinion
Date Created: 2018-06-01 13:00:24.639911+00
Date Added: 2024-06-11T07:49:05.031536
License: Public Domain

Case: 17-11705      Date Filed: 05/31/2018      Page: 1 of 3

                                                                         [PUBLISH]

                 IN THE UNITED STATES COURT OF APPEALS

                           FOR THE ELEVENTH CIRCUIT

                                     ______________

                                      No. 17-11705
                                     ______________

                         D.C. Docket No. 2:08-cv-00655-AKK

CSX TRANSPORTATION, INC.,
                                                                        Plaintiff-Appellant,
                                           versus

ALABAMA DEPARTMENT OF REVENUE,
VERNON BARNETT,
Commissioner of the Alabama Department of Revenue

                                                      Defendant-Appellees.
                 __________________________________________

                    Appeal from the United States District Court
                       for the Northern District of Alabama
                 __________________________________________

Before ED CARNES, Chief Judge, BLACK, Circuit Judge, and MAY, * District
Judge.

PER CURIAM:

       *
        Honorable Leigh Martin May, United States District Judge for the Northern District of
Georgia, sitting by designation.
               Case: 17-11705     Date Filed: 05/31/2018    Page: 2 of 3

      CSX Transportation, Inc. (CSX) filed a petition for rehearing after we issued

a substitute opinion granting the State’s petition for rehearing. We issued that

substitute opinion to clarify that the water carrier exemption from the sales and use

tax applies only when those carriers purchase or use diesel fuel to ship freight

interstate, as opposed to shipping it intrastate. See CSX Transp., Inc. v. Ala. Dep’t

of Revenue, 888 F.3d 1163 (11th Cir. 2018).

      CSX worries that our substitute opinion may imprecisely describe the scope

of the water carrier exemption. That exemption applies to diesel fuel used by

water carriers “engaged in foreign or international commerce or in interstate

commerce.” Ala. Code §§ 40-32-4(a)(10), 40-23-62(3). CSX asserts that Alabama

courts broadly interpret the phrase “engaged in interstate commerce,” and that our

substitute opinion may suggest that the scope of the exemption is more narrow by

referring to exempted activity as, among other things, “haul[ing] freight interstate”

or “transport[ing] freight interstate.” E.g., CSX Transp., Inc., 888 F.3d at 1170–

71, 1179, 1183, 1187.

      We doubt that, but the State does not oppose CSX’s petition. Instead, it filed

a responsive motion to apprise the Court of a newly discovered fact that it says

warrants granting CSX the relief it requests. In keeping with the finest tradition of

the legal profession, the attorneys for the State disclosed in its motion that after

successfully seeking rehearing, they learned that the Department of Revenue has
              Case: 17-11705     Date Filed: 05/31/2018   Page: 3 of 3

inconsistently applied the statutory language “engaged in interstate commerce”

with respect to water carriers. To avoid further inconsistencies, the State agrees

with CSX that quoting the statutory language will help the district court fashion

relief consistent with our opinion.

      In light of CSX’s petition and the State’s motion, our substitute opinion is

modified to add, immediately before the last paragraph on page 1187:

             As long as the State retains the sales and use tax exemption for
      diesel fuel used by water carriers “engaged in foreign or international
      commerce or in interstate commerce,” Ala. Code §§ 40-23-4(a)(10),
      40-23-62(3), the 4-R Act forbids it from imposing the sales and use
      tax on diesel fuel used by rail carriers “engaged in foreign or
      international commerce or in interstate commerce.” Our opinion
      should be read with that imperative in mind.

The petition for rehearing is otherwise DENIED.