Executives of a former rail-based produce express service from Washington to the Midwest say BNSF Railway ruined their business when the railroad gave priority to coal and oil trains moving to the Pacific Northwest.
Those executives, Steven Lawson and Mike Lerner, said their Cold Train business was growing rapidly until BNSF reneged on a promise of 72-hour service between the Northwest and Chicago. Cold Train had ordered new refrigerated produce cars and had reached an agreement to sell the business when the railroad changed its service guarantee from 72 hours to 125 hours to cover the distance between the fields and orchards of Eastern Washington to the Windy City, they claimed in a federal lawsuit filed Tuesday in Spokane.
The railroad said it did not seek to harm any business, but was the victim of unusual increases in demand coupled with winter storms.
“BNSF has not been served with the complaint, and cannot categorically comment on allegations we have yet to see,” the railroad said in a prepared statement. “But any suggestion that BNSF would intentionally seek to cause harm to any customer runs completely contrary to how BNSF conducts business. BNSF is dedicated to customer satisfaction and growing our network to meet customer demand. BNSF did experience well documented service issues following unprecedented demand levels and historic winter weather events beginning late in 2013, but we worked to remedy those situations and regularly communicated with our customers throughout the period so that they could anticipate when service would improve and plan accordingly.”
The suit alleges that the schedule change angered both produce companies and Cold Train and led to the sale’s cancellation and the ultimate demise of the Cold Train operation. Cold Train’s business grew from 300 containers shipped monthly to 700 containers monthly two years later. The company expected its volume would hit 1,000 containers a month by the end of 2013.
BNSF initially delivered the produce-filled refrigerated containers within 72 hours 92 percent of the time. But by 2014, that figure had fallen to less than five percent, Cold Train claimed.
As the service deteriorated, Cold Train said BNSF kept reassuring them that the service would improve.
The former Cold Train managers blamed the slowdowns on the increasing volume of coal and oil unit trains head to the Pacific Northwest via BNSF’s Northern Tier rail corridor.
The former Cold Train officers asked the court to award damages of $41 million in the case.