[Federal Register Volume 61, Number 222 (Friday, November 15, 1996)]
[Notices]
[Pages 58611-58613]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 96-29438]


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DEPARTMENT OF TRANSPORTATION
Surface Transportation Board
[STB Finance Docket No. 33220]


CSX Corporation and CSX Transportation, Inc.--Control and 
Merger--Conrail Inc. and Consolidated Rail Corporation

AGENCY: Surface Transportation Board.

ACTION: Decision No. 3; notice of proposed procedural schedule.

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SUMMARY: The Board invites comments from interested persons on a 
proposed procedural schedule.

DATES: Written comments on the proposed schedule must be filed with the 
Board no later than December 6, 1996. Applicants' reply is due by 
December 16, 1996.

ADDRESSES: An original and 25 copies of all documents must refer to STB 
Finance Docket No. 33220 and must be sent to the Office of the 
Secretary, Case Control Branch, ATTN: STB Finance Docket No. 33220, 
Surface Transportation Board, 1201 Constitution Avenue, NW., 
Washington, DC 20423.\1\ In addition, one copy of all documents in this 
proceeding must be sent to each of the applicants' representatives: (1) 
Dennis G. Lyons, Esq., Arnold & Porter, 555 12th Street, NW., 
Washington, DC 20004-1202; and (2) Paul A. Cunningham, Esq., Harkins 
Cunningham, Suite 600, 1300 Nineteenth Street, NW., Washington, DC 
20036.

    \1\ In addition to submitting an original and 25 copies of all 
documents filed with the Board, the parties are encouraged to submit 
all pleadings and attachments as computer data contained on a 3.5-
inch floppy diskette which is formatted for WordPerfect 5.1 (or 
formatted so that it can be converted into WordPerfect 5.1) and is 
clearly labeled with the identification acronym and number of the 
pleading contained on the diskette [49 CFR 1180.4(2)]. The computer 
data contained on the computer diskettes submitted will be subject 
to the protective order entered in Decision No. 1, served on October 
25, 1996, in this proceeding, and is for the exclusive use of Board 
employees reviewing substantive matters in this proceeding. The 
flexibility provided by such computer file data will facilitate 
expedited review by the Board and its staff.
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FOR FURTHER INFORMATION CONTACT:
Julia M. Farr, (202) 927-5352. [TDD for the hearing impaired: (202) 
927-5721.]

SUPPLEMENTARY INFORMATION: In Decision No. 2, served and published in 
the Federal Register on November 15, 1996, the Board issued a notice to 
the public that, pursuant to 49 CFR 1180.4(b), CSX Corporation (CSXC), 
CSX Transportation, Inc. (CSXT), Conrail Inc. (CRI), and Consolidated 
Rail Corporation (CRC) \2\ had filed on October 18, 1996, a notice of 
their intent to file an application seeking authority under 49 U.S.C. 
11323-25 for: (1) the acquisition of control of CRI by Green 
Acquisition Corp. (Acquisition), a wholly owned subsidiary of CSXC; (2) 
the merger of CRI into Acquisition; and (3) the resulting common 
control of CSXT and CRI and CSXC. The Board found this to be a major 
transaction as defined in 49 CFR part 1180. Applicants intend to file 
their application on or before March 1, 1997.
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    \2\ CSXC and CSXT are referred to collectively as CSX. CRI and 
CRC are referred to collectively as Conrail. CSX and Conrail are 
referred to collectively as ``applicants.''
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    Applicants also filed on October 18, 1996, a petition to establish 
a procedural schedule (CSX/CR-3). Applicants' proposed procedural 
schedule is as follows:

Applicants' Proposed Procedural Schedule

F  Primary application and related applications filed.
F+30  Board notice of acceptance of primary application and related 
applications published in the Federal Register.
F+45  Notification of intent to participate in proceeding due.
F+60  Description of anticipated inconsistent and responsive 
applications due; petitions for waiver or clarification due with 
respect to such applications.
F+120  Inconsistent and responsive applications due. All comments, 
protests, requests for conditions, and any other opposition evidence 
and argument due. Comments by U.S. Department of Justice (DOJ) and U.S. 
Department of Transportation (DOT) due.
F+135  Notice of acceptance (if required) of inconsistent and 
responsive applications published in the Federal Register.
F+150  Response to inconsistent and responsive applications due. 
Response to comments, protests, requested conditions, and other 
opposition due. Rebuttal in support of primary application and related 
applications due.
F+165  Rebuttal in support of inconsistent and responsive applications 
due.
F+185  Briefs due, all parties (not to exceed 50 pages).
F+215  Oral argument (at Board's discretion).
F+217  Voting conference.
F+255  Date of service of final decision.
    Under applicants' proposal, immediately upon each evidentiary 
filing, the filing party shall place all documents relevant to the 
filing (other than documents that are privileged or otherwise protected 
from discovery) in a depository open to all parties, and shall make its 
witnesses available for discovery depositions. Access to documents 
subject to the protective order shall be appropriately restricted. 
Parties seeking discovery depositions may proceed by agreement. 
Relevant excerpts of transcripts will be received in lieu of cross-
examination, unless cross-examination is needed to resolve material 
issues of disputed fact. Discovery on responsive and inconsistent 
applications will begin immediately upon their filing. The 
Administrative Law Judge assigned to this proceeding will have the 
authority initially to resolve any discovery disputes.\3\
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    \3\ As we stated in Decision No. 2, the process of assigning an 
ALJ to this proceeding is underway, and we will leave all discovery 
matters, including the adoption of any guidelines governing 
discovery initially, to the discretion of the ALJ. A decision naming 
that judge will be issued as soon as possible.
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    The proposed schedule is substantially similar to that adopted in 
Union Pacific Corporation, Union Pacific Railroad Company and Missouri 
Pacific Railroad Company--Control and Merger--Southern Pacific Rail 
Corporation, Southern Pacific Transportation Company, St. Louis 
Southwestern Railway Company, SPCSL Corp., and The Denver and Rio 
Grande Western Railway Company (UP/SP), Finance Docket No. 32760 (see 
Decision No. 6, ICC served Oct. 19, 1995; and Decision No. 9, ICC 
served Dec. 27, 1995).
    Applicants' proposal is the first major consolidation transaction 
presented to the Board under the ICC Termination Act of 1995, Pub. L. 
104-88, 109 Stat. 803 (ICCTA), enacted December 29, 1995, and effective 
January 1, 1996. The Board is seeking comments from the public on 
applicants' proposed procedural schedule, as modified by us below to 
adhere more closely to the provisions of ICCTA. In ICCTA,

[[Page 58612]]

Congress provided pursuant to 49 U.S.C. 11325(b) [emphasis added]:

    (b) If the application involves the merger or control of two or 
more Class I railroads, as defined by the Board, the following 
conditions apply:
    (1) Written comments about an application may be filed with the 
Board within 45 days after notice of the application is published F 
+ 75 days under subsection (a) \4\ of this section. Copies of such 
comments shall be served on the Attorney General and the Secretary 
of Transportation, who may decide to intervene as a party to the 
proceeding. That decision must be made by the 15th day after the 
date of receipt of the written comments, and if the decision is to 
intervene, preliminary comments about the application must be sent 
to the Board by the end of the 15th day after the date of receipt of 
the written comments F + 90 days.
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    \4\ Under 49 U.S.C. 11325(a), ``[t]he Board shall publish notice 
of the application under section 11324 in the Federal Register by 
the 30th day after the application is filed with the Board * * *.''
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    (2) The Board shall require that applications inconsistent with 
an application, notice of which was published under subsection (a) 
of this section, and applications for inclusion in the transaction, 
be filed with it by the 90th day after publication of notice F + 120 
days under that subsection.
    (3) The Board must conclude evidentiary proceedings by the end 
of 1 year after the date of publication of notice under subsection 
(a) of this section. The Board must issue a final decision by the 
90th day after the date on which it concludes the evidentiary 
proceedings.

    Specifically, we propose to modify applicants' proposed schedule to 
require parties intending to file comments, protests, requests for 
conditions, and any other opposition evidence and argument to file 
their submissions 75 days from the date the application is filed [F + 
75] as provided for under 49 U.S.C. 11325(b)(1), with comments from the 
U.S. Department of Justice (DOJ) and the U.S. Department of 
Transportation (DOT) due 90 days from the date the application is filed 
[F + 90 days] as provided for under 49 U.S.C. 11325(b)(1). If these due 
dates were to be established for comments in this proceeding, responses 
to comments, protests, requested conditions, and other opposition, and 
also rebuttal in support of the primary application and related 
applications would be due 30 days after the due date (i.e., on F + 105 
for responses to commenters and parties other than DOJ and DOT; and on 
day F + 120 for responses to DOJ and DOT). We propose to keep 
inconsistent and responsive applications due 120 days from the date the 
application is filed [F + 120 days] as provided for under 49 U.S.C. 
11325(b)(2). Because there has not been a major merger in the East 
since the early 1980s, given our merger experience, we believe it would 
be prudent for us to factor in some additional time to accommodate 
possible unique issues that may arise. We propose extending applicants' 
proposed procedural schedule by 45 days allocated as follows: (1) 
Adding 5 days to applicants' proposed period of time for parties to 
prepare their briefs, so that briefs would be due on F + 190 days; (2) 
adding 15 days to applicants' proposed period of time for parties to 
prepare for oral argument, so that oral argument would occur on F + 235 
days; (3) adding 3 days to applicants' proposed 2-day interval between 
the oral argument and the voting conference, so that a voting 
conference would occur on F + 240 days; and (4) adding 22 days to 
applicants' proposed period of time after the voting conference for the 
service of the Board's final decision on F + 300 days. In addition, we 
propose requiring applicants to file an environmental report, including 
all supporting documents, no later than 30 days prior to the filing of 
the primary application.\5\
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    \5\ While applicants need not file their actual operating plan 
due at the time of the filing of their application, the supporting 
documents must be completely consistent with their operating plan 
and contain sufficient information to allow immediate initiation of 
the environmental review process.
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Proposed Procedural Schedule as Modified by the Board

F-30  Environmental report, including all supporting documents due.
F  Primary application and related applications filed.
F+30  Board notice of acceptance of primary application and related 
applications published in the Federal Register.
F+45  Notification of intent to participate in proceeding due.
F+60  Description of anticipated inconsistent and responsive 
applications due; petitions for waiver or clarification due with 
respect to such applications.
F+75  All comments, protests, requests for conditions, and any other 
opposition evidence and argument due.
F+90  Comments by U.S. Department of Justice (DOJ) and U.S. Department 
of Transportation (DOT) due.
F+105  Responses to comments, protests, requested conditions, and other 
opposition due. Rebuttal in support of primary application and related 
applications due in response to filings on day F+75.
F+120  Inconsistent and responsive applications due. Rebuttal in 
support of primary application and related applications due in response 
to filings of DOJ and DOT on day F+90.
F+135  Notice of acceptance (if required) of inconsistent and 
responsive applications published in the Federal Register.
F+150  Response to inconsistent and responsive applications due.
F+165  Rebuttal in support of inconsistent and responsive applications 
due.
F+190  Briefs due, all parties (not to exceed 50 pages).
F+235  Oral argument (close of record).
F+240  Voting conference.
F+300  Date of service of final decision.

    Applicants are proposing that any applications for authority for, 
or for exemption of, merger-related abandonments, and any supporting 
verified statements, be filed with the primary application, and be 
treated as related applications, with any opposition evidence, 
comments, rebuttal and briefing on those applications to be submitted 
in accordance with the same schedule as the primary application. We 
agree that we should process any merger-related abandonment 
applications in accordance with the overall merger procedural schedule, 
rather than applying the procedures found at 49 U.S.C. 10903, which is 
similar to the process we used in the UP/SP proceeding. See UP/SP 
(Decision No. 9) (ICC served Dec. 27, 1995), slip op. at 9-10. 
Therefore, we will grant applicants' request for waiver under 49 CFR 
1152.24(e)(5) to permit modifications of the procedures and timetables 
prescribed in 49 CFR 1152.25(d) (6) and (7) to be consistent with the 
procedural schedule subsequently adopted in this proposed merger 
proceeding.\6\
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    \6\ Applicants indicate that they intend to file shortly a 
petition for waiver or clarification of Railroad Consolidation 
Procedures, and related relief. As in UP/SP, applicants should also 
seek an exemption under 49 U.S.C. 10502 from any statutory 
procedural requirements at 49 U.S.C. 10903 necessary to allow the 
Board to process the merger-related abandonment applications under 
the procedural schedule ultimately adopted. See UP/SP (Decision No. 
3) (ICC served Sept. 5, 1995), slip op at 7-10.
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    We invite all interested persons to submit written comments on the 
procedural schedule we are proposing here. Comments must be filed by 
December 6, 1996. Applicants may reply by December 16, 1996.
    This action will not significantly affect either the quality of the 
human environment or the conservation of energy resources.

    Decided: November 13, 1996.


[[Page 58613]]


    By the Board, Chairman Morgan, Vice Chairman Simmons, and 
Commissioner Owen.
Vernon A. Williams,
Secretary.
[FR Doc. 96-29438 Filed 11-14-96; 8:45 am]
BILLING CODE 4915-00-P