On June 9, 2008, the Ninth Circuit Court of Appeals held that a trackage rights transaction exempted from prior approval by the Surface Transportation Board (STB) nevertheless triggered § 11321(a) of the Interstate Commerce Act, allowing the override of "all other law … as necessary … to carry out the transaction," including the applicant rail carriers' Railway Labor Act (RLA) bargaining obligations. See United Transp. Union v. Burlington N. Santa Fe R.R. Co., No. 07-35066 (9th Cir. June 9, 2008).

The case arose out of a trackage rights agreement between Burlington Northern Santa Fe Railroad Co. (BNSF), Union Pacific (UP) and Longview Switching Company (LSC) that would enable LSC to perform switching operations on behalf of all three carriers at the Longview Junction yard. The carriers filed a notice of exemption with the STB pursuant to 49 C.F.R. § 1180.2(d)(7), which exempts from prior approval certain trackage rights transactions. The STB acknowledged the exemption and imposed on the transaction the standard labor protective conditions contained in Norfolk & Western Ry. Co. - Trackage Rights - BN, 354 L.C.C. 605 (1978), [modified] 360 I.C.C. 653 (1980). The United Transportation Union (UTU), which represents employees of all three carriers, requested that the STB stay the exemption, but the STB denied the UTU's request. Rather than appealing the STB's ruling to Court of Appeals or invoking arbitration under the Norfolk & Western protective conditions, the UTU sought injunctive relief in the U.S. District Court for the Western District of Washington, relying on the RLA. The district court dismissed the UTU's suit based on the lack of subject matter jurisdiction.

The Ninth Circuit affirmed. Section 11321(a) of the Interstate Commerce Act exempts from "all other law," including the RLA, transactions "approved by or exempted by the board under this subchapter." UTU argued that because the exemption invoked by the carriers was created by § 10502 of the Interstate Commerce Act, which is not in the same subchapter as § 11321, the override of "all other law" did not apply. The court rejected the UTU's argument because the subchapter encompassing § 11321 does not provide for a single exemption. "The more reasonable construction of 'exempted by the board under this subchapter' is that § 11321(a) immunity applies if the result of a board exemption that originates anywhere in the statutory scheme is that a carrier need not comply with a requirement imposed in Subchapter II." Slip op. at 6561. The court further noted that its decision was in accord with Union RR Co. v. United Steelworkers, 242 F.3d 458 (3d Cir. 2001) and that, pursuant to Chevron U.S.A., Inc. v. Natural Res. Def. Council, Inc., 467 U.S. 837, 843 (1984), the court was required to follow the STB's reasonable interpretation of the Interstate Commerce Act.