CRIMINAL (JONES ACT & ANTITRUST) / U.S. Department of Justice announces that ex-CEO of Horizon Lines Charles G. “Chuck” Raymond will NOT be criminally charged in connection with the U.S. DOJ Antitrust Division’s investigation of maritime cabotage liner service between the U.S. mainland and Puerto Rico in which Horizon Lines had entered a guilty plea admitting to criminal conduct during his tenure for which it obligated itself to pay a fine of $45 million announced February 24, 2011. Various civil litigation relating to this situation continues.

See twitter feeds issued date of this post from noted Journal of Commerce editors Joseph Bonney and Peter Tirschwell, respectively, here and here

Note that the U.S. DOJ announcement of the company’s guilty plea in 2011 expressly left the door open to possible criminal charges against Mr. Raymond thereafter.

Various civil litigation relating to this situation continues. E.g., see this complaint brought by Kraft Foods, Inc. and Kellogg Company against other liner carriers in this trade lane and not naming either Horizon or Mr. Raymond as defendant – but identifying Mr. Raymond as a conspirator (set forth at Pages 25-26 thereof).

ANTITRUST (RAILROADS & CAPTIVE SHIPPERS) / Captive shippers suit against Class I railroads dismissed without prejudice: Sherman Act § 1 conspiracy “in restraint of trade” did not specify harm apart from having to pay surcharge and did not specify any individual captive shipper. Second, Sherman Act § 2 conspiracy to monopolize fail as a matter of law when pled against two railroads – “monopolization” in the sense of § 2 pertains only to a single company acting on its own.

First, Sherman Act § 1 conspiracy “in restraint of trade” pertaining to fuel surcharges dismissed without prejudice because complaint, “lacks adequate facts concerning how any individual plaintiff was harmed by the alleged conspiracy [i.e., just having to pay the surcharges did not by itself constitute ‘injury’]”. Second, Sherman Act § 2 conspiracy to monopolize dismissed without prejudice because no allegations just against a single Class I defendant Class I railroad (“The very phrase ‘shared monopoly’ is paradoxical”) – “To the extent that plaintiffs have alleged a market structure in which UP [railroad] and BNSF [railroad] each possess and seek to protect market power within the same markets, their monopoly claims based on an alleged agreement to monopolize must fail.”   

Oxbow Carbon & Minerals, LLC v. Union Pacific Railroad, 2013 WL 673778 (U.S. District Court for the District of Columbia, February 26, 2013). Free copy available here.

UPCOMING: RAILROAD / Antitrust case alleges four largest U.S. freight railroads conspired to impose “rate-based” fuel surcharges (i.e., calculated as a percentage of base transportation rate – not mileage or other basis). Seeks money damages in 10 figures (after trebling). Railroads seek interlocutory (i.e., before final disposition in trial court) review of class certification issues.

Before the United States Court of Appeals, District of Columbia Circuit.


No. 12-7085

Pending Appeal:

On Petition for Permission to Appeal Pursuant to Federal Rule of Civil Procedure 23(f). 2012 WL 6018796 (December 3, 2012).

How Interlocutory Appellants-Defendant Railroads Describe the Case: 


“Whether interlocutory review is appropriate to resolve one or more of the following class certification issues:

“(1) Whether the district court erroneously certified a class on the ground that common evidence can establish “widespread” injury and damages, notwithstanding the fact that the class contains members who suffered no injury and individualized assessments of Continue reading