Quote:
Originally Posted by ardecila
That's a dumb logic in that ruling. Is a new pipeline company "not a pipeline company" because they are not presently transporting oil via pipes? Somehow I doubt new pipelines are subject to the same legal hurdles in Texas.
That's a legal standard that, in addition to being total nonsense, likely violates Federal antitrust law.
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Since this seems like such an insane verdict I've been trying to look up some of the reasoning behind it. As far as I can tell the issue seems to be Texas law as written is very specific about what corporations are legally considered railroads (with the associated eminent domain powers), and the dividing line is the operation of rail vehicles. The law makes no mentions of intending to operate rail vehicles in the future, and so by the very strict interpretation of the law Texas Central isn't a railroad.
The interaction of the various laws seem designed to prevent a bad actor buying up land though eminent domain using a proposed rail line they never truly intend to build. Requiring you to be actively running a railroad ensures you've already made some capital investment, and in the 19th century a new railroad was far more likely to start out running trains relatively short distances though mostly unclaimed land without need for eminent domain. This 21st century situation of a new entrant to the market needing to build hundreds of miles of rail for an IOS is simply something they never conceived of.
Another Texas judge in Harris County has ruled that Texas Central is indeed a railway, so there isn't a firm decision either way yet. But a ruling in Texas Central's favor would beg the question of what's preventing a real estate developer from using a new "railroad" to force landowners to sell their property for pennies on the dollar, then have it declare bankruptcy to acquire all that land for themselves.