Applicability of Railway Labor Act to State Ports Authority

919/716-6680

October 11, 1999

Erik Stromberg Executive Director North Carolina State Ports Authority

P.O. Box 9002 Wilmington, N.C. 28402

Re: Advisory Opinion re Applicability of Railway Labor Act to State Ports Authority

Dear Mr. Stromberg:

This letter responds to your recent request that our office revisit its June 13, 1994 Advisory Opinion concerning "any negative legal consequences" associated with a then pending legislative proposal to abolish the Ports Railway Commission (PRC) and provide a current opinion as to "whether the State Ports Authority (SPA) would be subject to the Railway Labor Act if it leased the port switching operations directly to private operators without the ‘buffer’ of the Ports Railway Commission." Considering the well established principle that the wisdom of legislation is a matter for the General Assembly, D&W, Inc. v. Charlotte, 268 NC 577, 591 (1966), comments expressed herein should not be interpreted as a recommendation either to abolish the PRC or to transfer its assets to the SPA.

The June 13, 1994 Advisory Opinion stated that "[t]he most likely ‘negative consequence’ of abolishing PRC and transferring its assets to SPA would be in connection with the litigation involving SPA, PRC, and the ILA which is pending before the National Mediation Board." The litigation referred to was In re North Carolina State Ports Authority v. International Longshoreman’s Association, AFL-CIO, 26 NMB No. 60, File No. CJ-6209. The action was brought by the International Longshoreman’s Association (ILA) against the State Ports Authority (SPA) under the Railway Labor Act (RLA), 45 U.S.C. § 155. At the time the 1994 opinion was issued, the case had been pending in one form or another since 1969, had been to the federal circuit court twice, and was then was currently before the National Mediation Board (NMB) for a determination as to whether the SPA and the PRC were "under common control." On June 7, 1999, the NMB ruled that the PRC was no longer a "carrier" within the meaning of the RLA and thus the question of "whether the SPA and PRC are under common control is moot." The ILA has stated that it does not intend to appeal the NMB decision.

Given the holding of the NMB, it is our opinion that it is highly unlikely that either the NMB or the federal courts would find the SPA to be a "carrier" for purposes of the RLA if it leased the port switching operations directly to private operators "without the buffer of the PRC". Further, a recent decision of the United State Supreme Court has provided new support for our office’s original position that RLA does not apply to State-owned railroads. In College Savings Bank v. Florida Prepaid Postsecondary Education Expense Board, 119 S.Ct. 2219 (June 23, 1999), the United States Supreme Court specifically overruled its earlier holding in Parden v. Terminal Ry. Of Alabama State Docks Department, 337 U.S. 184 (1964) that a state could be subjected to a private cause of action in federal court for damages under the Federal Employers’ Liability Act (FELA) under the theory of "constructive waiver." The Parden decision was one of two decisions relied upon by the federal district and circuit courts in their determinations that the SPA, a State agency, was subject to the requirements of the RLA. International Longshoreman’s Association v. North Carolina Ports Authority, 332 F. Supp. 95 (EDNC 1971), vacated and remanded, 462 F.2d 1 (4th Cir. 1972); International Longshoreman’s Association v. North Carolina Ports Authority, 370 F. Supp. (EDNC 1974), affirmed 511 F. 2d 1007 (4th Cir. 1975). In light of the recent NMB and United States Supreme Court decisions, it is our opinion that the SPA would likely not become subject to the RLA if it leased the port switching operations directly to private operators.

Sincerely,

Reginal L. Watkins Senior Deputy Attorney General

Victoria L. Voight Special Deputy Attorney General

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