After more than a month of litigation, a U.S. District Court judge dismissed a motion for a temporary restraining order for the removal of rails at the Cross Kirkland Corridor.

The city of Kirkland planned on removing the rails along the 5.75 mile corridor in April to be replaced by gravel for an interim trail. But plans came to a halt when the city was met with a lawsuit from a Ballard railroad company.

On May 3, Judge Marsha Pechman denied the Ballard Terminal Railroad Company’s lawsuit against the city and stated that federal court lacks the jurisdiction to order an injunctive relief of rail removal. Instead, she ruled the Surface Transportation Board (STB) holds the authority to hear the injunctive relief that would alter their 2008 Notice of Interim Trail Use (NITU) agreement.

“This is one very good step,” said Mayor Joan McBride. “This is good news for Kirkland.”

Lawyers representing the Ballard Terminal Railroad Company, LLC and partner in the lawsuit, the Eastside Community Rail, LLC, claimed their reasons for going to federal court was that the city was facing counts “that involved an action arising under” U.S. laws, specifically the Interstate Commerce Commission Termination Act (ICCTA) of 1995.

The railroad company’s request for a temporary restraining order was to keep the city from removing the rails and other materials until the STB has made a decision on Ballard’s pending petitions. One petition is an appeal that seeks the right to reactivate rail service along the Woodinville to Bellevue rail line “for the public interest of removing trucks and promoting commerce with new freight business.” The other is a request that the STB order the transfer of the rail assets along the rail line to Ballard at net liquidation value.

The STB is expected to make their reactivation decision by January 18, 2014.

“The removal of the city’s rail assets along the Woodinville to Bellevue line will deal a severe blow to restoration of rail service,” wrote Lisa Miller, a paralegal with Montgomery Scarp, who represented the Ballard railroad company. “The removal of the rail assets along the city’s segment of track will also result in the loss of the opportunity for Ballard to expand the market for its rail transportation services in the area, and other irreparable harm.”

But city officials, who have tried to work with the company to discuss a phased approach, disagree.

“They’re trying to have their cake and eat it too,” said city manager Kurt Triplett. “[They’re saying] ‘the rail is so valuable that we cannot have an economically viable freight line without it,’ and yet it’s ‘so valuable we want it turned over to us … but at bargain prices.’”

The federal court backed up the city’s argument that the railroad company’s complaint could not be heard in federal court because the STB’s NITU decision had already authorized salvage of the tracks and ties along the lines upon rail removal. Challenges to that order, which was made in 2008, could only be brought in the Court of Appeals, pursuant to the Hobbs Act, and that their complaint was a “collateral attack” on an STB order.

“It’s not clear to us why Ballard filed in federal court to begin with,” Triplett said. “Ballard seems to be interested in throwing hurdles at us.”

Court documents say the purpose of an NITU is to allow a railroad entity, or its successors, to remove the rails and develop a trail on a right-of-way without triggering abandonment under state law.

“As the STB has observed, ‘the Trails Act does not prohibit a trail sponsor from removing track or making changes to the [right of way] … so long as the property remains available for reactivation of rail service,’” the documents continue.

The plaintiff also alleged that because the city had planned to remove the rails without providing an Environmental Impact Statement (EIS), it was violating the State Environmental Policy Act (SEPA). This lack of EIS, Ballard contended, “will impose significant burdens on the environment that Ballard, who anticipates acquiring the right to restore rail service along the line following the STB’s decisions on Ballard’s petitions now pending before it, will be required to deal with and otherwise manage.”

The environmental issue is one that the Kirkland-based Eastside Rail Now! organization agrees with, but according to the city’s lawyer Hunter Ferguson with Stoel Rives, LLP, the city isn’t breaking any laws.

“Even if this court had jurisdiction to consider Ballard’s SEPA claim, the ICCTA preempts it,” Ferguson’s written court documents state.

Ferguson argues, on behalf of the city, that several cases such as City of Auburn v. United States have set a precedent that the ICCTA prevents the requirement of a SEPA review application upon a rail salvage operation.

“Removing the tracks and rails do not have an impact on the environment because of the way we’re doing it,” Triplett said. “What the courts have done, based on practice, is rule that there is no material difference to the environment.”

Triplett explained that the process would not disturb anything but the dirt underneath the top of the line. He said that the city will “definitely” do a SEPA review before the interim trail is constructed as well as for the master plan’s final trail and transit line expected in the many years to come.

“We’re not trying to avoid anything,” he said. “We don’t want to spend time and money that’s not necessary. We’re trying to be frugal with the tax payer’s dollars.”

The Ballard Terminal Railroad Company planned on filing an injunctive relief with the Surface Transportation Board on May 8 (after Reporter deadline), according to their lawyer Tom Montgomery with Montgomery Scarp, PLLC.

“There would be $10 million in damages if Kirkland removes the rail before the reactivation decision,” said Montgomery, who added the Ballard railroad company wants to keep with the “status quo” until the STB decision is made.

Nevertheless, Triplett thinks the city will be able to make their case with the STB, noting one big argument will be that the two railroad companies that want to reactivate rail use on their Snohomish to Woodinville line still need $6 million from the state to get started, which has been a cause of frustration from the city.

“Get your first phase in order, then come talk to us,” said Triplett, referring to the railroad companies. “In the mean time, we’re moving on with our plans.”

However, Triplett stressed that if an injunctive relief is filed with the STB, Kirkland will not see rail removal or gravel trails until the final decision is made in the city’s favor.

“It was a grand plan, it was a good plan,” he said of the corridor trail. “I still have high hopes that we’ll be able to proceed with that, but it was a nice shot in the arm. We just have to be on to the next hurdle.”

The U.S. District Court will issue a written opinion on the case by May 13.