A Dakota Minnesota & Eastern Railroad unit train.

26 April 2011

Former DM&E Manager Says Owner Should Honor Deal

Sioux Falls South Dakota USA - A former Dakota, Minnesota & Eastern Railroad manager is suing the company's Canadian owner, saying executives should have honored a preexisting deal that promised he could keep his union seniority.
 
Clyde Mittleider filed the federal lawsuit against Canadian Pacific Railway alleging breach of contract in U.S. District Court in Sioux Falls on Friday.
 
In the lawsuit, Mittleider said his position in Sioux Falls was eliminated in March and that he was denied an opportunity to return to "the ranks" with a job in Brookings. DM&E executives promised that if the union denied his seniority in an arbitration hearing, he would be made whole financially if he chose to leave management, he said.
 
T.J. Nelson, a Canadian Pacific spokesman, said the company can't comment on pending litigation.
 
Mittleider, who was hired by the DM&E in 1987 as a conductor and brakeman, was a supervisor in Huron in 2002 when DM&E purchased the assets of I&M Rail Link Railroad and renamed it IC&E.
 
The company offered Mittleider a position as a superintendent in Mason City, Iowa, which he accepted under the condition that he could keep his seniority. He said Robert Brownell, then a vice-president, and Kevin Schieffer, DM&E's president, made that promise.
 
Mittleider was promoted in 2004 to assistant chief transportation officer and moved to Sioux Falls, which prompted the United Transportation Union to challenge whether he could retain his seniority status. He lost his rights during that arbitration hearing, but said that Brownell and Schieffer assured him he would be made whole for the loss of any seniority benefits.
 
In September 2007, Canadian Pacific Railway announced it was buying DM&E for $1.48 billion in cash, and the deal was approved by the Surface Transportation Board a year later.
 
Brownell, in an August 2009 letter to Mittleider filed with the lawsuit, said the guarantee he made on behalf of DM&E meant Mittleider would get his seniority rights back or be made whole financially.
 
"You took a risk for us and I hope and expect that the company will stand by you to make it right," Brownell wrote.
 
Mittleider in his lawsuit requests a jury trial.
 
Dirk Lammers.