U.S. Supreme Court Sides With Amtrak in Case

The U.S. Supreme Court has sided with Amtrak in a dispute with its host railroads over on-time standards.

The court unanimously found that Amtrak is a government entity and it directed the U.S. District Court for the District of Columbia to reconsider the case in light of the high court’s ruling.

That court had ruled in a case brought by the Association of American Railroads that Amtrak was a private company and therefore could not participate in setting standards with the FRA in the Passenger Rail Investment and Improvement Act of 2008’s Section 207, which sets measurable thresholds of on-time performance, because one private entity (Amtrak), would be regulating others (host railroads).

The district court had also expressed reservations about the constitutionality of Amtrak’s structure.

Writing for the Supreme Court, Justice Anthony Kennedy cited a 1995 Supreme Court case in which Amtrak had tried to argue it was private, but lost.

In the AAR case, Kennedy wrote, “The political branches created Amtrak, control its Board, define its mission, specify many of its day-to-day operations, have imposed transparency and accountability mechanisms, and for all practical purposes set and supervise its annual budget.”

Kennedy also said the District Court will still need to deal with the issue of whether the delegation of powers to Amtrak violates the Due Process or Appointments clauses of the Constitution.
Justices Clarence Thomas and Samuel Alito Jr., wrote separate concurring opinions in which each expressed reservations about Amtrak’s structure.

Alito argued that Section 207’s arbitration provision “is fair game for challenge,” because if a private arbitrator were chosen to decide a dispute over metrics between the FRA and Amtrak (which didn’t happen), that person would be “making law without supervision” and that would be illegal.

Alito also said that since Amtrak’s president is appointed by the board of directors but not the President of the United States, “it does not necessarily follow that the present structure of Amtrak is consistent with the Constitution.”

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