19 March 2008
DM&E Trial Starts
DM&E SD40-2 6384 - Date unknown Joseph
Testagrose.
Casper Wyoming USA - Attorneys made opening remarks
Tuesday in federal court in Casper in Dakota, Minnesota & Eastern Railroad Co.'s condemnation case against several landowners in
northeast Wyoming.
Ten years of planning and a pending merger with a well-financed railroad company should give DM&E authority to condemn
some 1,200 linear acres of private property in northeast Wyoming, according to the railroad's attorneys.
But property owners argued that for 10 years DM&E has never had an asset in Wyoming - that it's trying to build a financial asset
by first condemning private property, then hoping that a financial partner will fund the project.
"These are real people with real ranches, and they've been encumbered for the last 10 years," said Gillette attorney Tad
Daly, who represents several landowners.
DM&E wants to build more than 120 miles of new rail line in Wyoming to access the Powder River Basin coal mining district, which is
served by only two rail companies.
Attorneys from both sides argued about whether DM&E's proposed Powder River Basin expansion has financial backing and will
ultimately be built.
Holland & Hart attorney Matt Micheli said that based on the pending merger and 10 years' worth of permitting, DM&E has met its
burden of evidence to show public benefit and reasonable evidence that construction will occur. He argued that now the burden switches
to the landowners to prove that DM&E has not negotiated with them in good faith.
Micheli said DM&E is spending $4.5 million to $5 million per month on the Powder River Basin expansion project. U.S. District Judge
William Downes asked what, specifically, is DM&E spending that money on. DM&E attorneys said the money is being spent on
"development" in preparation of construction.
Downes repeatedly reminded DM&E attorneys that the further back in time they reached to present evidence, the less valuable it is
in making a determination today.
Downes also said two 800-pound gorillas missing from the courtroom on Tuesday were head decision-makers from
Canadian Pacific - the railroad planning to merge with DM&E - as well as DM&E. Those are the people who must ultimately decide
whether to build the Powder River Basin extension. "If this were BNSF (Railway) or Union Pacific, would we be here today?"
Downes asked.
Downes asked several questions regarding how a third rail carrier might affect competition and prices for coal transportation, and
ultimately Wyoming's coal industry and the state's citizens.
DM&E attorneys say the railroad's proposed Powder River Basin project would instantly increase the basin's coal export capacity by
100 million tons annually.
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