PALESTINE, Texas — Union Pacific on Monday notified employees at its Palestine, Texas, car shop that their current jobs would be eliminated following the latest ruling in a long-running court battle over an agreement dating to 1872.
The Dallas Morning News reports the railroad notified the 57 employees it would close the shop after the Texas Supreme Court on Friday turned down a request by Anderson County to rehear the case. The county and city were seeking to overturn a lower-court ruling last year that a 1954 agreement between predecessor Missouri Pacific and the city of Palestine and Anderson County is unenforceable [see “Union Pacific gets state-court win …,” Trains News Wire, March 10, 2024].
The 1954 agreement was an update of one from 1872 in which MP predecessor Houston & Great Northern Railroad agreed to “forever” keep its shops and headquarters in Palestine in return for funding support. The 1954 update required a certain percentage of the railroad’s jobs to be maintained in Palestine, but UP sued in 2019 to end the agreement. A federal court voided the agreement in 2021 [see “Digest: Federal judge voids UP employment requirement …,” News Wire, Feb. 5,2021], but state-court rulings and appeals have kept the shop open since.
Anderson County attorney Jim Allison told the Morning News the closure notice was premature because the state Supreme Court had not yet issued its mandate finalizing the decision, and that the county would be filing a motion to stay that mandate while it appeals to the U.S. Supreme Court. “There are federal issues involved in this case,” Allison said.
The railroad said the shop’s employees would be offered jobs elsewhere on the UP system.
“Rail is essential to Texas and the U.S. economy,” it said in a statement to the newspaper, “and this decision allows us to better align our resources to serve our customers.”
UP has argued the earlier agreement restricts interstate commerce in violation of federal law.
Any agreement between Houston & Great Northern were terminated the minute Mo Pac was merged into the Union Pacific. Unless that agreement was specifically made a part of the merger agreement, it became null and void as far as Union Pacific was concerned. If Anderson County wants to try to sue the Missouri Pacific Trust for redress then that is a possibility but chances are nil that any members of that trust survive. Anderson County is just throwing tax payer money down a dry well hole because the the SCOTUS will support the Federal Court in this case because it agreed with the lower State court ruling. Time to move on…
Even if the city prevails, I would think that keeping the shops open, could be applied in various ways. Maybe future mergers could anticipate the problems with antiquated contracts.
Maybe they should shop for a judge who blocks presidential executive orders.
Trains misspelled the word ‘County’ twice, in two different ways. One with an extra letter ‘i’, the other missing an letter ‘o’.
Just saying.
Contracts are made to be broken by corporations. They have unlimited lawfare funding and will spend massively to avoid their contractual obligations. Speaking from personal experience (we won, but litigation is grueling). Think of DJT… he was plaintiff or defendant in 3500 cases prior to the 2016 election. It’s a way of life for corporations and billionaires.