Date: Dec 22, 2004
Facing the potential for several billion dollars worth of class action lawsuits pertaining to unauthorized use of railroad rights-of-way, Sprint, Qwest, Level 3 and Williams asked the 7th Circuit U.S. Court of Appeals on Friday to stay its October decision allowing those lawsuits to proceed.
Although a nationwide settlement with landowners had been reached, and a nationwide class certified by the district court, the 7th Circuit vacated that certification after concluding that certain landowners in Kansas and Tennessee could not adequately be represented. According to experts hired by those landowners, the nationwide settlement would have compensated them for only one-tenth of the estimated $20-40 per foot that the easements are worth. The companies collectively have laid an estimated 36,000 miles of fiber nationwide.
For electric utilities whose facilities carry cable and telecommunications services that may not be covered by their easements, this case highlights the difficulty (and potentially huge expense) of coming to terms with class action landowners. The 7th Circuit recognized this expense by noting that the Pony Express might still be running today if class action lawyers had been active in the 1830s when the first transcontinental railroad was being built.
If you have any questions or comments about this case, please contact Tom Magee at 202-434-4128 or email@example.com.