Congressman Barney Frank
Representing Massachusetts' 4th District

Frank Refuses to Help CSX on Foreign Investment Fight Pressures Company Over Potential Liability Claims in Commuter Train Accidents
June 11, 2008
 

Congressman Barney Frank is using his position as Chairman of the House Financial Services to press CSX Corporation to be more cooperative on a key liability question that has slowed progress on planning for the Boston to Fall River and New Bedford commuter rail project. CSX owns the rail lines that would be used for the project, but is insisting that any proposed sale to the state include a provision indemnifying CSX from future loss of life claims, even if the company were found to be at fault.

Saying “why do I want to protect their right to screw my state?”, Frank has pointedly refused to weigh in with federal regulators on behalf of CSX in the company’s dispute with a group of English investors who are seeking to unseat some members of the CSX board. The unusual confluence of regional transportation policy and international finance has come about because the Financial Services Committee has jurisdiction over laws relating to foreign investment including the Committee on Foreign Investment in the United States (CFIUS), a federal oversight body charged with investigating potential national security threats associated with foreign investment in U.S.-based companies.

“Given how uncooperative CSX has been on the commuter rail liability question, I see no reason to help them out with their foreign investment problem,” Frank said. “Their position that, as owners of the rail lines, they will not accept liability for loss of life even if it’s their fault, is creating a major obstacle to continued progress on the commuter project. I am unwilling to assist them when they have been so unreasonable about a crucial matter affecting my constituents and the citizens of Massachusetts.”

Though CSX has not directly asked CFIUS to look into the actions of the English investors, the company has urged Congress to seek a CFIUS investigation. A group of U.S. Senators recently requested a CFIUS review of the matter.