A federal court in Washington has awarded damages of $400 million to The Swinomish Indian Tribal Community to be paid by a railroad company (BNSF Railway Company) for knowingly exceeding the scope of a railroad easement on the tribe’s property. Swinomish Indian Tribal Cmty. v. BNSF Rwy. Co., 2024 WL 3027911, 2024 US. Dist. LEXIS 107314 (W.D. Wash. 2024).
Federal common law governs a claim for trespass on Indian lands. The railroad company breached its easement agreement by unilaterally increasing the number of trains and the number of cars crossing tribal land without the tribe’s written consent. The court had found that the railroad company breached a right-of-way easement agreement with the tribe, and that the trespass was “willful, conscious, and knowing throughout the trespass period.” Swinomish Indian Tribal Cmty. v. BNSF Rwy. Co., 664 F.Supp.3d 1218 (W.D. Wash. 2023).
In the remedies phase, the court held that disgorgement of net profits gained from willfully exceeding the scope of the easement was the appropriate remedy. Judge Robert Lasnik explained:
“Consistent with general equitable principles and the Restatements, a conscious wrongdoer will be stripped of the net profits obtained from its unauthorized interference with another’s property. Restatement (Third) of Restitution §40, cmt. b; id. §51(4).”If liability in restitution were limited to the price that would have been paid in a voluntary exchange, the calculating wrongdoer would have no incentive to bargain.” Id. §40, cmt. b. “Even against a conscious wrongdoer, [however,] restitution may be limited to avoid a liability for gains that are unduly remote . . . or disproportionate to the loss on which liability is based…Id. The Court’s task, therefore, is to establish BNSF’s liability based on the circumstances of the wrong, seeking both to protect the Tribe’s interests and to deter future trespass, all without resort to an arbitrary penalty.”
Note that a similar trespass case is being litigated by a tribe against an energy company whose pipeline crosses tribal land when the tribal easement expired and was not renewed by the tribe. See Bad River Band of the Lake Superior Tribe of Chippewa Indians of the Bad River Reservation v. Enbridge Energy Co., 626 F.Supp.3d 1030 (W.D. Wis. 2022).