Tank Car Maker Controlled by Carl Icahn Suing Railroad Regulators

[mahatmakanejeeves]

Fourteen hours old, too late for LBN.

Articles in TWSJ. are increasingly pay per view. If you find that to be the case here, go in via Google News or just plain Google. You can bypass the paywall that way.

Ted Mann is a regular on TWSJ.'s oil by rail beat. I'll be adding this link to Oil by Rail Safety Megathread in the Economy Forum.

Tank Car Maker Controlled by Carl Icahn Suing Railroad Regulators

President-elect Trump appointed Mr. Icahn as an adviser on regulatory issues

By Jennifer Smith and Ted Mann

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Updated Dec. 22, 2016 6:35 p.m. ET

Carl Icahn’s new role advising President-elect Donald Trump on regulatory matters comes as a tank car manufacturer he controls is suing railroad safety regulators. ... American Railcar Industries Inc. sued the Federal Railroad Administration last month after the agency ordered that hundreds of tank cars the company built be tested for leaks. The FRA order also affects tank cars made by another Icahn-controlled firm, ACF Industries LLC.

In a Nov. 28 letter to the agency filed with the court complaint, ARI Chief Executive Jeffrey Hollister wrote that the agency exceeded its authority to compel such a broad inspection based on a leak in a single tank car that was detected in 2014. The directive calls for all the company’s tank cars to be visually inspected before going into service and for hundreds of the cars with the greatest use to get comprehensive shop inspections.

The agency insists it is using authority under its “objectively reasonable and articulable belief” that a class of railcars “may be in an unsafe operating condition.” The regulators revised the order to, among other things, reduce the number of tank cars to be comprehensively inspected, in part because of limited capacity at inspection sites. FRA still wants all of the cars to be tested eventually.

The FRA wrote in its revised directive that inspectors have found welding defects similar to the original flaw in 15% of nearly 400 similar tank cars that have been examined since a tank car was found leaking ethanol while in operation with Canadian Pacific Railway Ltd.

[elleng]

1. 'objectively reasonable,'

I'd say.