On October 9, 2014, a Great Falls district court judge found that BNSF’s litigation strategy of trying to blame its train crew after the responsible operating department officials had exonerated them violated a court rule prohibiting the assertion of frivolous claims and defenses.On July 19, 2011, BNSF assigned one of its track welders to “escort” a non-BNSF maintenance of way train owned and operated by non-BNSF contractors. They were doing work that could have been done by BNSF’s own track maintenance employees. BNSF preferred to use contractors. The BNSF welder who was serving as “escort” for these non-BNSF contractors had never done this work before. He spent the day dodging rattlesnakes while struggling to stay cool and hydrated. At the end of the work day the dispatcher had the contractors tie their train down at Gerber, a little-used industry track southeast of Great Falls.The welder forgot to restore the east siding switch at Gerber. He left the scene and drove 12 miles northwest to Great Falls where he was directed to begin repairing a switch frog in the yard. While doing this, he learned the dispatcher was trying to find him to ask about the switch at Gerber. The welder contacted the dispatcher and incorrectly reported having restored the switch to mainline position. The applicable operating rule required this to be done before leaving Gerber, while the welder still had the switch under visual observation.Meanwhile, our client and his engineer were bringing their train west from Stanford toward Great Falls. The dispatcher, believing the welder’s report that the east Gerber switch had been restored to mainline position, gave our client and his engineer a track warrant all the way into Great Falls. When the crew rounded the trees and bushes east of Gerber they saw the switch target was against them and dumped the air, but were unable to stop. They dove to the floor, braced for collision, and suffered serious injury in the resulting collision with the parked maintenance train.BNSF assumed full control of the incident scene as repair efforts began. It downloaded the event recorder data. It spoke to the dispatcher and the welder. Several hours later BNSF’s Montana Division general manager notified all involved that these facts “exonerated” the train crew and they would not be required to undergo FRA urinalysis.Our client filed his FELA lawsuit against BNSF about a year and a half later after struggling with back surgery and post traumatic stress disorder. BNSF’s answer asserted our client had been “contributorily negligent” — that he had been careless himself and that this contributed to causing the Gerber wreck. At his deposition BNSF’s lawyers claimed he had been careless when he took a radio call from the dispatcher and glanced down at his handwritten notes of mileposts passed, so he could give an accurate train position to the dispatcher. BNSF said our client should have anticipated that someone would have left the Gerber switch open in his path. They said he should have been watching down the track for that instead of trying to give an accurate rollup to the dispatcher.The problem with this defense was that the welder who left the switch open and then wrongly reported having restored it violated General Code of Operating Rules 8.3. BNSF had adopted GCOR 8.3 in response to the FRA regulation set out at 49 C.F.R. § 218.105. That regulation required railroads to adopt operating rules requiring employees who open switches in dark territory to close them and report doing so to the dispatcher while still present at the scene with the switch under observation. The regulation further provided that any violation of the operating rule would likewise be a violation of the regulation itself. In FELA cases, any violation of an FRA regulation by the railroad or a co-worker establishes the railroad’s liability as a matter of law and precludes the assertion of a contributory negligence defense. In other words, BNSF’s contributory negligence defense was illegal under these facts.We warned BNSF this defense was improper. BNSF persisted with it, so we filed a motion for “summary judgment” explaining that the undisputed facts and controlling law prohibited this defense.At the same time we filed a separate motion explaining that the assertion of this illegal defense violated Montana Rule of Civil Procedure 11. That rule provides that an attorney who signs a court paper like BNSF’s Answer to our client’s Complaint “certifies to the best of the person’s knowledge, information, and belief, formed after an inquiry reasonable under the circumstances” that the court paper in question
(1) it is not being presented for any improper purpose, such as to harass, cause unnecessary delay, or needlessly increase the cost of litigation;(2) the claims, defenses, and other legal contentions are warranted by existing law or by a nonfrivolous argument for extending, modifying, or reversing existing law or for establishing new law;(3) the factual contentions have evidentiary support or, if specifically so identified, will likely have evidentiary support after a reasonable opportunity for further investigation or discovery; and(4) the denials of factual contentions are warranted on the evidence or, if specifically so identified, are reasonably based on belief or lack of information.
We argued in this motion that there was no factual or legal basis for BNSF to accuse our client of having caused the Gerber wreck. We further argued that BNSF knew when it asserted this defense that it would emotionally devastate our client because BNSF knew he regarded the Gerber wreck as a personal calamity that had changed the entire trajectory of his life for the worse. David Paoli wrote the briefs in support of this motion. John Kutzman argued the motion at the final pretrial conference on September 23, 2014.The court agreed with our arguments in its October 9 Rule 11 order. The court described BNSF’s contributory negligence defense as “feeble.” Then the court explained:
BNSF also lamely asserts its contributory negligence defense does not violate Rule 11 because it couched its pleading with the word, “may”. This is simply a last-ditch argument by BNSF to maintain its defense at all costs, only compounding the frivolous, bad faith nature of its pleading. To borrow lyrics from a Jimmy Buffett song, “That’s my story and I’m stickin’ to it” seems to aptly describe BNSF’s strategy to maintain its frivolous defense. See Jimmy Buffett, “That’s My Story And I’m Stickin’ To It ,” Off to See the Lizard, (MCA Records 1989).. . . The Rule 11 violation here is of the worst kind: it is personal. This is not a situation, for instance, where a defendant alleges laches when it does not apply. Rather, BNSF deliberately and with no hesitation maliciously alleges Schnittgen is at fault for this train wreck. In D’Agostino, the court admonished all members of the Montana bar that the “language of Rule 11 is mandatory. If a district court finds that a pleading or motion is groundless or filed for an improper purpose, the court shall impose an appropriate sanction.” 230 Mont. at 448. A failure to impose sanctions when circumstances reveal the rule has been violated is reversible error. See id. at 446.Given BNSF cleared Schnittgen of wrongdoing before he sued, the only conceivable motivation for BNSF’s assertion of contributory negligence is to emotionally grind down Schnittgen to abandon his case, accept some nuisance-value settlement, or to otherwise intimidate or pressure him. Given the numerous opportunities Schnittgen provided BNSF to withdraw its frivolous defense, the Court concludes asserting and maintaining contributory negligence was an improper delay, deny, and defend tactic by BNSF. None of these purposes is proper under Rule 11, and BNSF’s conduct must be sanctioned.
When the Court issued this order on October 9 our client’s jury trial was less than a week away. Yesterday the jury in that case rejected BNSF’s other defenses and returned a $4.32 million verdict for our client. You can read the full Rule 11 order below.[gview file=”/wp-content/uploads/2014/10/2014-10-09-Rule-11-Order.pdf”]