Archive for Bellingham news

BNSF Sued for Alleged Cold Train Contract Breach

In recent Bellingham news, former executives of the now defunct Cold Train express produce service from Washington to Chicago have sued BNSF Railway in U.S. District Court in Spokane for a sum in excess of $41 million. This lawsuit suggests an alleged breach of contract for the 72 hour service guarantee for delivery of produce from the Northwest to Chicago.

lawsuit-bnsfIn the lawsuit filed on April 7, 2015, the former executives allege that BNSF turned their business into a train wreck when BNSF gave preference to oil and coal trains destined for the Pacific Northwest. In the lawsuit, Cold Train maintained that, in reliance on its agreement with BNSF, it ordered more refrigerated rail cars and even entered into an agreement with a purchaser to buy the company. According to The Capital Press, Cold Train claims a $31.7 million loss on the sale of the company along with an additional $6 million in damages for the contracts on the additional refrigerated cars.

The former Cold Train executives say that everything changed when BNSF changed its service guarantee from a 72 hour transit time to 125 hours. Although not yet having been served with the lawsuit, BNSF commented on it and related that indeed it did experience service issues during the winter of 2013 due energy demand coupled with severe winter weather.

Before the service guarantee change, Cold Train had experienced strong growth. After the 72 hour service guarantee contract was entered into, delivery of the refrigerated containers was on time 92 percent of the time.  Cold Train claims that figure was reduced to less than five percent of the time by 2014. Its former executives maintain that former-executives-cold-trainBNSF was making so much money shipping coal and oil, that it didn’t have sufficient space for the Cold Train containers.

Cold train was in business from April of 2010 until August of 2014. It grew from 300 to over 700 refrigerated containers and was expected to grow to 1,000 carrying Washington apples, produce and frozen foods to Chicago. These products were arriving to eastern destinations faster and fresher. It isn’t known if the case will reach trial. Lawsuit settlement cases are a large segment of the litigation process.