Federal judge dismisses transportation museum lawsuit

October 23, 2017

A federal judge has dismissed a lawsuit between the Indiana Transportation Museum and the Hoosier Heritage Port Authority.

The Noblesville-based museum filed the complaint in July against the Port Authority, the city of Fishers and the city of Noblesville, accusing them of unjustly interfering in the museum’s operations, causing it a critical loss of more than a half-million dollars in revenue. The suit said the defendants violated the museum’s constitutional rights under the First and 14th amendments.

The Transportation Museum and area officials have been wrestling over the future of the 37-mile railroad corridor that runs from Tipton to Indianapolis for more than a year. The section makes up the regional portion of the Nickel Plate Railroad.

Noblesville and Fishers plan to convert a 9.2-mile section of the rail corridor into a pedestrian trail, but the museum argues that the rails should remain and that it should be able to operate trains along it.

The Port Authority, the quasi-government entity that oversees the railroad for the owners — Fishers, Noblesville and Hamilton County — terminated its policy-of-use agreement with the museum in March 2016 amid concerns about the not-for-profit’s financial condition and maintenance of the tracks.

That meant the museum had to discontinue its popular State Fair Train and Polar Bear Express rides last year.

The museum said the Port Authority’s actions caused it to lose $500,000 in potential revenue from the two excursion rides.

The Port Authority issued a request for proposals for a new operator, and in July, officials selected Nickel Plate Heritage Railroad Inc. to operate trains on the northern portion of the corridor, which would allow the trail proposal to move forward.

In the lawsuit, the museum accuses the Port Authority of not allowing its representatives to address the board in a public meeting and not having a hearing on modifying the request for proposals.

The museum, which responded to the request for proposals along with four other entities, alleged that the scoring methodology was unfair from the start.

The museum also argued it was denied due process because it has a property interest in the railroad due to the $3 million it has invested to maintain the corridor. The suit also said the museum was denied equal protection because the Port Authority treated the museum “differently than any other person or entity.”

The Port Authority asked for the lawsuit to be dismissed, arguing the U.S. District Court in the Southern District of Indiana did not have jurisdiction, the museum did not state a claim upon which relief could be granted and the accusations did not “give rise to constitutional violations.”

Chief Judge Jane Magnus-Stinson ruled Friday that the court did have jurisdiction, but agreed the claims from the museum were not constitutional violations.

“It is well-settled … that the public does not have a constitutional right to be heard by a public body that is making a policy decision,” Magnus-Stinson wrote. “... Because ITM bases its First Amendment claim on HHPA’s failure to allow it to address HHPA regarding ITM’s desire to be the track operator, its claim fails as a matter of law based on ITM’s own allegations.”

Magnus-Stinson also rejected the museum’s Fourteenth Amendment claim because it did not provide legal authority to prove that paying for upkeep of the track creates a property interest, and it did not prove it was treated differently than other entities.

“ITM complains that it was not allowed to present information to HHPA at meetings but, significantly, does not allege that other entities were allowed to do so either,” Magnus-Stinson wrote.

“The Indiana Transportation Museum has not had an opportunity to carefully evaluate the dismissal by Federal Court of our suit,” museum president John McNichols said in a written statement. “The Museum is reviewing all legal options and preparing to move forward to preserve the historic and educational legacy of the Museum.”

Noblesville and Fishers did not file responses to the lawsuit, but Magnus-Stinson wrote that her decision applies to those defendants as well because the museum did not have specific claims against the cities, and the arguments from the cities would likely mirror the Port Authority’s response.

The ruling does not prohibit the museum from filing a state lawsuit.


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