Food giant claims railroads fixed fees

Archer Daniels Midland Co, a major food processor, has filed suit against five major US railroads, alleging they schemed to fix fuel surcharges, according to court documents.

ADM has paid more than $250 million in fuel surcharges since 2003 and is seeking treble damages, according to the lawsuit filed in Minnesota District Court.

ADM moves millions of tons of corn, soybeans and other agricultural products using rail lines each year.

ADM confirmed that it filed the lawsuit but had no comment.

The suit was filed against CSX Transportation Inc, Burlington Northern Santa Fe Corp, Union Pacific Corp, Norfolk Southern Corp and Kansas City Southern.

CSX Transportation is a subsidiary of CSX Corp.

A spokesman for Union Pacific said the company had not yet seen the lawsuit. No one was immediately available to comment at Kansas City Southern or Norfolk Southern.

CSX said it believed its fuel surcharges have always complied with all laws and regulations, said spokesman Garrick Francis.

Burlington Northern Santa Fe also denied the allegations.

"The allegations in this case do not have any merit and we intend to vigorously defend," said Burlington Northern Santa Fe spokesman Pat Hiatte. "We also expect this case will be consolidated with previously filed lawsuits before Federal Judge Paul Friedman in Washington, DC."

Last year, Dust Pro Inc, a Phoenix, Arizona-based maker of soil stabilizers, filed a suit seeking class-action status against the same five railroads alleging price fixing.

US rail shippers have been angry over fuel surcharges levied by railroads to move their goods. In 2007, the Surface Transportation Board, a US government regulator, said the railroads must change the way they levy fuel surcharges.

Surcharges are intended to help US railroads recoup the rising cost of fuel.

Agencies

(China Daily 03/28/2008 page17)