A federal judge found BNSF Railway willingly, consciously and knowingly trespassed when it ran about a quarter-million cars carrying crude oil over the Swinomish Reservation beyond what was outlined in an agreement with the tribe. Now, the issue at hand is how much money the railway must pay to make it right.
BNSF has operated a rail line over the reservation under a 1991 easement agreement that permits trains to carry no more than 25 cars each direction per day. It also required BNSF to tell the tribe about the "nature and identity of all cargo" crossing the easement, which is less than a mile long.
U.S. District Court Judge Robert Lasnik said in a written order last year that the railway made a unilateral decision to increase the number of trains and cars crossing the reservation without the tribe's consent from September 2012 to May 2021 "in pursuit of profits."
A bench trial is underway before Lasnik this week to determine the profits BNSF obtained as a result of its interference with the Swinomish Indian Tribal Community's legally protected property rights.
The tribe argues it should get as much as $445 million of the railway's profits made while trespassing, while BNSF argues it should pay far lower than that.
What is the focus of this trial?
It is all about how much money BNSF made during the period it trespassed and how much of it should go to Swinomish.
The witnesses agreed on the number of cars — 266,877 — that trespassed. They agreed the revenue those cars generated was about $900 million. Swinomish and BNSF ultimately disagree on how much the court should order be paid to Swinomish.
BNSF has to show what portion of that money it would have earned without violating the easement agreement.
Three expert witnesses were questioned for more than three hours Monday.
They debated whether the company should be responsible for its profits on the segment of the railroad where they trespassed, or the entire roughly 1,500 mile journey of crude oil trains from the Bakken formation, through the Swinomish Reservation to nearby oil refineries.
Economic consultant Michael Baranowski, called as a witness by BNSF, said there is no precedent for the calculations he has been asked to make. He was asked to identify the portion of the profits attributable to the easement itself, which is not a routine request he or other consultants typically receive. He said there's no formula or special calculation.
"So what you're saying is, whatever I do is going to be right, because there is no right answer?" Judge Lasnik said Monday, drawing laughter from the courtroom.
Why is BNSF on trial?
The issue in court this week dates back to 1889 when BNSF's predecessor, the Seattle and Northern Railroad Company, illegally constructed a railroad through the Swinomish Reservation. The tribe objected, and court documents show the railway failed to obtain permission by treaty or congressional approval before completing the railroad.
The railway used the tracks without permission for decades, and in 1970, the Swinomish Indian Tribal Community again objected. When the tribe and railway were unable to come to an agreement, the tribe asked the United States to bring a lawsuit against the railway for trespass and removal of the rail line in 1977.
That fall, the railway was denied a right-of-way application from the federal Bureau of Indian Affairs because it lacked consent from the tribe. The tribe and BNSF reached an easement agreement in 1991.
The tribe sued in 2015, alleging BNSF was running six 100-car trains per week over the right of way, four times the permitted number of cars under the easement agreement.
The railroad crosses sensitive marine ecosystems using a swing bridge over the Swinomish Channel and a trestle across Padilla Bay within the reservation. These water bodies connect with other marine waters of the Salish Sea, where the tribe has treaty-protected rights to fish.
"Railroads also had a history of taking land from Indian tribes or from local government," Lasnik said while questioning a witness in 2023. "And basically, the expression 'I got railroaded,' existed for a reason."
"Could you see how the Swinomish Tribe might feel that, after telling you — the predecessor of Burlington Northern — in 1889, 'No, you can't build the track,'" the judge continued, "and they went ahead and built it anyway, and never paid a dime to the tribe for almost 100 years, that they might feel a little bit like they've been railroaded?"
How much money is at stake?
BNSF estimates it could owe Swinomish anywhere from more than $10 million to nearly $30 million for profits made while trespassing.
Swinomish, however, argues that BNSF made profits from a line of business — transporting Bakken crude oil by rail from North Dakota to the refineries between 2012 and 2021 — that could only be negotiated and provided because BNSF ignored the easement limitations and trespassed over the reservation.
BNSF was paid for completed movements to the refinery, not for transporting the oil through one segment of the journey. The tribe states that BNSF made nearly $450 million from nearly a decade of continuous trespasses over the reservation.
Without completing deliveries to the refineries, unit trains traveling roughly 1,500 miles from the Bakken formation would have generated no income. Lasnik said last month that BNSF would likely need to pay out profits from the entire shipping route.
The testimony is expected to continue at least through Tuesday afternoon and closing statements will follow. Then it will be up to Lasnik to decide.
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