[Federal Register Volume 89, Number 116 (Friday, June 14, 2024)]
[Notices]
[Pages 50663-50664]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: 2024-13166]


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SURFACE TRANSPORTATION BOARD

[Docket No. FD 36782]


Paul Didelius and CCET LLC--Intra-Corporate Family Transaction 
Exemption--Cincinnati Eastern Railroad LLC

    Paul Didelius (Didelius) and CCET LLC (CCET I), a Class III rail 
carrier controlled by Didelius, have filed a verified notice of 
exemption for an intra-corporate family transaction pursuant to 49 CFR 
1180.2(d)(3), under which CCET I will merge with and into a newly 
formed noncarrier entity, CCET II, with CCET II as the surviving 
carrier corporation and Didelius controlling CCET II.
    CCET I leases approximately 69.45 miles of rail line in Ohio from 
Norfolk Southern Railway Company (NSR) pursuant to an agreement 
extended in 2020. See CCET, LLC--Lease & Operation Exemption--Rail Line 
of Norfolk S. Ry., FD 36370 (STB served Dec. 26, 2019). According to 
the verified notice, CCET I's owners have reached an agreement to sell 
CCET I to 3i RR Holdings GP LLC et al. and Regional Rail, LLC (3i/
Regional Rail), which currently control twelve other Class III rail 
carriers in the eastern United States. See 3i RR Holdings GP LLC--
Control Exemption--Ind. E. R.R., FD 36735 (STB served Nov. 16, 2023). 
Didelius and CCET I state that to accommodate certain corporate and tax 
considerations in connection with that transaction, CCET I will undergo 
a reorganization immediately prior to its sale to 3i/Regional Rail. The 
owners of CCET I have formed CCET Holding, Inc. (CCET Holding), which 
will assume direct ownership of CCET I. CCET II will be formed as a 
separate, noncarrier subsidiary of CCET Holding, and CCET I will be 
merged with and into CCET II, with CCET II as the surviving 
corporation, becoming a Class III rail carrier controlled indirectly by 
Didelius. The parameters of its lease operations in Ohio will be 
identical to those of CCET I. CCET II, in turn will be the rail carrier 
acquired by 3i/Regional Rail pursuant to the concurrently filed notice 
of exemption in 3iRR Holding GP LLC--Control Exemption--Cincinnati 
Eastern Railroad, Docket No. FD 36783. In that proceeding, 3i/Regional 
Rail seek to obtain control of CCET II.
    Didelius and CCET I state that the agreement between CCET I and 
CCET II that will govern the proposed transaction does not include any 
provision that would limit the future interchange of traffic with any 
third-party connecting carrier, nor does the existing lease agreement 
between CCET I and NSR.\1\
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    \1\ Didelius and CCET I filed with their verified notice an 
unexecuted copy of the agreement.
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    The verified notice states that the transaction will not adversely 
affect the level of existing rail service, or result in significant 
operational changes or a change in the competitive balance with 
carriers outside the corporate family. Therefore, the transaction is 
exempt from the prior approval requirements of 49 U.S.C. 11323. See 49 
CFR 1180.2(d)(3). Unless stayed, the exemption will be effective on 
June 30, 2024, (30 days after the verified notice was filed).
    Under 49 U.S.C. 10502(g), the Board may not use its exemption 
authority to relieve a rail carrier of its statutory obligation to 
protect the interests of its employees. However, 49 U.S.C. 11326(c) 
does not provide for labor protection for transactions under 49 U.S.C. 
11324 and 11325 that involve only Class III rail carriers. CCET I is a 
Class III rail carrier and CCET II will be a Class III rail carrier 
after consummation of the proposed intra-corporate merger transaction. 
Accordingly, the Board may not impose labor protective conditions here 
because all the carriers involved are Class III rail carriers.
    If the verified notice contains false or misleading information, 
the exemption is void ab initio. Petitions to revoke the exemption 
under 49 U.S.C. 10502(d) may be filed at any time. The filing of a 
petition to revoke will not automatically stay the effectiveness of the 
exemption. Petitions for stay must be filed no later than June 21, 2024 
(at least seven days before the exemption becomes effective).
    All pleadings, referring to Docket No. FD 36782, must be filed with 
the Surface Transportation Board via e-filing on the Board's website or 
in writing addressed to 395 E Street SW, Washington, DC 20423-0001. In 
addition, one copy of each pleading must be served on Didelius's and 
CCET I's representative, Thomas J. Litwiler, Fletcher & Sippel LLC, 29 
North Wacker Drive, Suite 800, Chicago, IL 60606-3208.
    According to Didelius and CCET I, this action is categorically 
excluded from environmental review under 49 CFR 1105.6(c) and historic 
reporting under 49 CFR 1105.8(b).
    Board decisions and notices are available at www.stb.gov.

    Decided: June 11, 2024.


[[Page 50664]]


    By the Board, Mai T. Dinh, Director, Office of Proceedings.
Brendetta Jones,
Clearance Clerk.
[FR Doc. 2024-13166 Filed 6-13-24; 8:45 am]
BILLING CODE 4915-01-P