The United States five big railroads are being sued on allegations of violating anti-trust laws in fixing their fuel surcharges.
Decatur, Illinois-based Archer Daniels Midland (ADM), one of the world's largest agribusiness companies and a major rail customer, claimed it had paid more than US$250 million in fuel surcharges since 2003. The lawsuit doesn't say the surcharges are illegal, but accuses the railroads of illegally acting in concert.
The railroads named in the suit are Omaha-based Union Pacific Railroad (UP); Fort Worth, Texas-based BNSF Railway; Jacksonville, Florida-based CSX Transportation (CSX); Norfolk, Virginia-based Norfolk Southern Railway (NSC); and Kansas City, Montana-based Kansas City Southern Railway (KSU).
The lawsuit accuses the five railroads of setting fuel surcharges by working through the Association of American Railroads, which publishes the indices used by railroads to calculate rates. AAR's board includes the CEOs from the five railroads, according to the lawsuit.
The lawsuit accuses UP and BNSF of agreeing to tie their surcharges to the same fuel price index, and to impose changes in the surcharge on the same day. The effect is that the two railroads' fuel surcharges moved in lockstep, the lawsuit alleges.
The lawsuit claims CSX, Norfolk Southern and Kansas City Southern did the same thing in the east.
Some of the railroads hedge their fuel purchases. The lawsuit said that means their actual fuel spending should vary from one railroad to the next - but the surcharges did not.
The uniform pricing "could not have happened by chance or coincidence," the lawsuit said.
Decatur, Illinois-based Archer Daniels Midland (ADM), one of the world's largest agribusiness companies and a major rail customer, claimed it had paid more than US$250 million in fuel surcharges since 2003. The lawsuit doesn't say the surcharges are illegal, but accuses the railroads of illegally acting in concert.
The railroads named in the suit are Omaha-based Union Pacific Railroad (UP); Fort Worth, Texas-based BNSF Railway; Jacksonville, Florida-based CSX Transportation (CSX); Norfolk, Virginia-based Norfolk Southern Railway (NSC); and Kansas City, Montana-based Kansas City Southern Railway (KSU).
The lawsuit accuses the five railroads of setting fuel surcharges by working through the Association of American Railroads, which publishes the indices used by railroads to calculate rates. AAR's board includes the CEOs from the five railroads, according to the lawsuit.
The lawsuit accuses UP and BNSF of agreeing to tie their surcharges to the same fuel price index, and to impose changes in the surcharge on the same day. The effect is that the two railroads' fuel surcharges moved in lockstep, the lawsuit alleges.
The lawsuit claims CSX, Norfolk Southern and Kansas City Southern did the same thing in the east.
Some of the railroads hedge their fuel purchases. The lawsuit said that means their actual fuel spending should vary from one railroad to the next - but the surcharges did not.
The uniform pricing "could not have happened by chance or coincidence," the lawsuit said.