Union Pacific is asking a federal court of appeals to review the decision by the Surface Transportation Board to approve the merger between Canadian Pacific and Kansas City Southern.
UP had expressed concerns during STB hearings on the merger that the board needed to impose conditions upon CP and KCS that would ensure competition at interchanges.
“The merger of Kansas City Southern and Canadian Pacific is likely to reduce competition and negatively impact shippers and stakeholders,” UP (NYSE: UNP) told FreightWaves in a statement on why it petitioned the U.S. Court of Appeals for the District of Columbia Circuit on Wednesday. “In approving the merger, the Surface Transportation Board acknowledged these concerns, but did not adopt solutions to remedy the harms.”
STB had approved the merger between Class I railroads CP and KCS on March 15 and then last month, CP and KCS finalized the merger, becoming Canadian Pacific Kansas City, or CPKC. CPKC has said the merger would result in the first transcontinental railroad between Canada, the U.S. and Mexico that would provide single-line service between the three countries.
In the two-page petition to the court, UP said: “Union Pacific seeks relief on the grounds that the agency action is in excess of the Board’s authority; that it is arbitrary, capricious, an abuse of discretion, and otherwise not in accordance with law; and that it is not supported by substantial evidence. Union Pacific requests that this Court vacate the order under review and grant such additional relief as may be necessary and appropriate.”
In response to UP’s action, CPKC (NYSE: CP) told FreightWaves in a statement: “We don’t know what UP’s argument is, but in our view, the STB conducted a comprehensive, thorough and thoughtful review of the combination which produced the right final decision clearly recognizing the combination’s many benefits.”
STB told FreightWaves it does not comment on pending litigation.
If the court sides with UP, then STB could have to reconsider what conditions to place upon CPKC that would ensure competition.
Subscribe to FreightWaves’ e-newsletters and get the latest insights on freight right in your inbox.
Click here for more FreightWaves articles by Joanna Marsh.
Related links:
Brokerage Compliance Symposium
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
F3 Awards Dinner
The night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
F3: Future of Freight Festival
Industry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The day before F3. Every compliance issue you face - fraud exposure, carrier liability, FMCSA rules, cargo theft, insurance gaps - navigated by attorneys and operators defining best practices in a changing industry.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowThe night before F3. FreightTech100 companies honored. FreightTech 25 and Shipper of Choice winners revealed live. Cocktail reception into dinner and live music - 300 industry leaders in one purpose-built room.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register NowIndustry-defining keynotes, rapid-fire technology demos, and industry leaders networking in experiences across Chattanooga - plus the inaugural F3 Awards Dinner featuring the FreightTech and Shipper of Choice reveals.
The Signal at Chattanooga Choo Choo • Chattanooga, TN Register Now