| A federal judge granted preliminary approval Thursday to a $4.2 million class-action settlement in claims by thousands of Kansas landowners against three of the nation’s largest telecommunications companies, calling the deal a “Herculean job” that will help solve the property rights dispute over installation of fiber-optic cable on railroad rights of way.
U.S. Magistrate Judge Kenneth Gale also certified a so-called settlement class composed of landowners with property adjacent and underlying the railroad rights of ways and approved the form and process to notify landowners in July. A hearing is set for Nov. 14 in Wichita.
The federal lawsuit in Kansas was filed against Sprint Communications Co., Qwest Communication Co. and Level 3 Communications in 2010, and the proposed agreement would resolve claims that affect about 459 miles of railroad rights of way in Kansas.
“It is the product of years and years of litigation and settlement efforts,” said Dan Millea, a Minneapolis attorney who is representing plaintiffs in the case.
At issue – in some 70 lawsuits filed in state and federal courts across the nation – is a practice where telecommunications companies installed fiber-optic cable systems in railroad rights of way by reaching agreements with the railroads that possessed those rights. The plaintiffs alleged the railroads do not have sufficient rights to authorize the installation, while the defendants disagreed.
“I think the parties have done a Herculean job trying to solve this problem,” Gale said.
Landowners in Kansas and 45 other states reached settlements following years of “arduous litigation” in courts across the country, according to court documents. Left out of the negotiations: Tennessee, as litigation continues there; Louisiana, where a settlement was negotiated separately; and Alaska and Hawaii.
In all of the settlements, telecom companies would get easements from landowners for fiber-optic cable.
In the Kansas settlement, landowners with valid claims would receive $2.98 million, and payments would be determined on whether the railroad originally acquired the property under a federal land-grant statute or by private conveyance.
That dates back to the mid-1800s when Congress tried to encourage the building of transcontinental railroads by granting railroads not only right-of-way corridors but also ownership of alternating sections of public lands on either side of those corridors, according to court documents.
Kansas landowners with property adjacent to non-land grant rights of way who submit a qualified claim would be paid $2.19 per foot. Property owners with land-grant claims would be paid between 13 cents per foot to 52 cents per foot.
In seeking approval of the legal fees – more than $1 million for attorneys – Millea told the court Thursday that the total investment by plaintiffs’ counsel exceeded the proposed payment to plaintiff attorneys. Administrative costs in the Kansas suit are estimated at $321,000.
J. Emmett Logan, an attorney representing Sprint Communications Co., told the court that attorneys hope to send out coordinated notices of settlements in 38 states in July, although it is likely that only 20 states will be far enough along in the legal process by that time.
The settlement calls for direct notice to every known qualifying property owner as well as publication in media outlets. A website with information on the settlement also is planned.