The Surface Transportation Board has ordered Union Pacific to make public a recording of Chief Executive Jim Vena’s remarks to a shipper conference, rejecting the railroad’s appeal in a dispute over whether he threatened customers who oppose its proposed acquisition of Norfolk Southern (NYSE: NSC).
The board’s Nov. 4 decision leaves in place a ruling requiring the recording to lose its confidential designation.
The dispute has raised questions about transparency in the merger review, with the regulator expressing “serious concerns” about whether Union Pacific (NYSE: UNP) had influenced stakeholder input on the proposed $85 billion transaction.
The recording captures Vena’s address to the Southwest Association of Rail Shippers at its annual conference in Houston in March. Rival Canadian Pacific Kansas City sought its public release, arguing that Vena’s remarks allegedly threatening higher rates for shippers opposing the merger had chilled participation in the regulatory proceeding.
An administrative law judge ruled Oct. 23 that Union Pacific must provide the video without its “Confidential” label by Oct. 30. The speech was delivered at a major industry conference without restrictions on recording.
Union Pacific appealed on Oct. 30 and requested a temporary stay. It argued that public release could cause “irreparable harm” by allowing others to “edit, clip, manipulate, and distribute” the recording outside the merger proceeding. The railroad maintained that parties to the case could already view the video and use it in regulatory filings under the existing confidentiality restrictions.
As an alternative, Union Pacific offered to post the video on its merger website while retaining its confidential designation and restrictions on use outside the proceeding. That proposal would have allowed public viewing without giving others unrestricted permission to reproduce or distribute the recording.
CPKC (NYSE: CP) challenged Union Pacific’s effort to delay disclosure, arguing that the railroad had missed its appeal deadline and asking the board to require immediate compliance. Union Pacific disputed that interpretation, saying its appeal fell within the seven days allowed under board rules.
Why it matters: The STB must decide whether to approve the Union Pacific–Norfolk Southern transaction, and the allegations surrounding Vena’s remarks have raised concerns about whether customers can express their views freely during that review.
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Read more articles by Stuart Chirls here.
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