U.S. DEPARTMENT OF TRANSPORTATION v. ASSOCIATION OF AMERICAN RAILROADS
Amtrak, a passenger railroad company, operates on tracks owned almost entirely by freight railroad companies that are required to give Amtrak trains preference in using a rail line, junction, or crossing. Section 207 of the Passenger Rail Investment and Improvement Act of 2008 (PRIIA) directs the Federal Railroad Administration (FRA) and Amtrak to jointly develop minimum standards for measuring the performance of passenger train operations. In the event of disagreement about the standards, an arbitrator can be appointed by the Surface Transportation Board (STB) to resolve any dispute through binding arbitration.
The Association of American Railroads (AAR) filed suit on behalf of the freight companies and argued that Section 207 of the PRIIA was unconstitutional because it violated the nondelegation doctrine of Article I of the Constitution, which prevents the delegation of power to regulate private entities, as well as the Fifth Amendment’s Due Process Clause. The district court granted the Department of Transportation’s motion to dismiss because Amtrak was a government entity for purposes of the Constitution, and even if Amtrak were a private entity, private entities are allowed to advise the government in the creation of industry regulations. On appeal, the U.S. Court of Appeals for the D.C. Circuit reversed and held that Section 207 of the PRIIA violated the nondelegation doctrine. Despite heavy governmental involvement in Amtrak’s ownership and organization, the appellate court held that Amtrak was a private, for-profit corporation that could not have equal right to craft industry regulations. The appellate court did not decide whether Section 207 violated the Fifth Amendment’s Due Process Clause.
(1) Does Section 207 of the PRIIA violate the nondelegation doctrine of Article I of the Constitution?
(2) Does Section 207 of the PRIIA violate the Fifth Amendment Due Process Clause?