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The death toll in the Los Angeles Metrolink commuter train crash has risen to 24 with scores hospitalized. Negligence on the part of the Metrolink engineer, who failed to stop the train at a red signal, is the likely cause of the crash in the San Fernando Valley on September 12, 2008. The engineer responsible for the collision died in the accident, but it is clear that the freight train that crashed into the Metrolink train had the right-of-way. The number of dead is expected to rise as rescue personnel continue to sift through the wreakage. It is unlikely that any more victims will be taken out of the wreck alive.

Colton, CA has over 50,000 residents and is located in San Bernardino County. One of Colton’s most renowned features is the Colton Crossing, a railroad intersection that ranks as one of the busiest in the nation. Two of the most famous freight companies, Burlington Northern Santa Fe and Union Pacific use Colton Crossing as a main line, and the train traffic at the junction is frequent. While freight trains carry mostly imported goods arriving from the local ports of LA and Long Beach, non-passenger trains can still be involved in accidents involving commuter trains, cars, trucks, and pedestrians. Get legal help if you have been hurt in a Colton train accident at 1-800-ALAWPRO today.

The Law Team at Greenberg & Rudman LLP has collected over $150 million for its clients. Let us do the work and worrying for you if you’ve been hurt in Colton and environs. Call 1-800-ALAWPRO (1-800-252-9776) for your free and confidential consultation and get the help you deserve now, or check out our website at www.alawpro.com to learn more. We will fight for you.

Mary Bonar and Martin Fleetwood legalweek

If you are travelling by train between London and Edinburgh, Sheffield or Birmingham, or cross-country via Birmingham, you will have noticed the change in ownership of a number of rail franchises, which took place in November. Through a competitive tendering process, the Department for Transport has awarded three large, reshaped operating franchises: cross-country to Arriva; West Midlands to Govia; and East Midlands to Stagecoach. GNER has been replaced on the East Coast by National Express and a new London Overground metro rail service is being run for Transport for London by a joint venture between Laing (the operators of Chiltern) and MTR of Hong Kong, in place of National Express.

For rail commuters, this looks rather like a game of musical chairs where the players move around and the same services continue to run, using the same trains and largely the same staff. Politicians, the media and even members of the public are beginning to focus on the cost of these massive competitions - estimated at £5m for a private sector bidder (which inevitably falls on the taxpayer and the passengers through fares) and whether the expenses involved in the rebranding of services and trains are justified.

The trains themselves are not owned by the franchise operators. Franchises, being service contracts, tend to be let for periods of between seven and 10 years and their most expensive capital assets are the rolling stock fleets which have a life of at least 35 years. While it is possible for operators to own their fleets and for these to transfer to a successor operator, the arrangements put in place for the British Rail fleet at the time of privatisation in 1994-97 were to put the ownership of the trains into one of three rolling stock leasing companies (ROSCOs) which then leased them to the franchise operating companies, usually for the length of the franchises and on standard operating lease terms. The ROSCOs took responsibility for major maintenance and overhauls, leaving the operator responsible for day-to-day maintenance only.

This allowed the Government to privatise the ROSCOs and effectively make the financing of the train fleet a matter for the private sector, removing it from the government's balance sheet.

The ROSCOs are: Angel Trains, owned by RBS; HSBC Rail owned by HSBC; and Porterbrook Leasing owned by Santander/Abbey. There have been several changes of ownership of each ROSCO since their initial sale by the Government. These resulted in some private individuals involved in the privatisation making very substantial amounts of money and the various bank owners appear to have made a satisfactory return, at least until recently.

Of course, the business of the ROSCOs has not stood still. They have been active in pursuing new business, both as the suppliers of new trains for the UK passenger market and also, in the case of Angel Trains and Porterbrook Leasing, in expanding into other markets. Porterbrook developed a portfolio of freight rolling stock leased mainly in Europe which it sold three years ago, refocusing on its UK portfolio. HSBC has been looking at the overseas rolling stock market through the bank rather than the UK leasing business. Angel has been steadily building a non-UK business which now almost equals its UK portfolio, in asset value. By doing this, it has diversified its assets and risks and moved away from the political domination of the UK passenger business.

Since privatisation, the ROSCOs have invested billions of pounds in fleets of new trains and facilities to maintain them. The main spurs to this investment have been the scrapping of the Southern Region slam door stock for safety reasons and the requirement for new types of train associated with infrastructure improvements on the West Coast involving the introduction of the Pendolino tilting trains and new Japanese-manufactured bullet trains to allow high-speed services from Kent to London on High Speed 1 (the new name for the Channel Tunnel Rail Link) from next year. Most of these and other new trains have been procured with a lot of involvement from the relevant train operators (often as part of a bid for a franchise) and are virtually all maintained by their manufacturer under specific maintenance agreements.

The passenger train leasing business in the UK is not subject to licensing or regulation of its pricing (unlike the monopoly supplier of the infrastructure, Network Rail, or the passenger operating companies) but has been put under considerable pressure by the Government to lower its pricing. The Government is directly concerned because train leasing and maintenance costs represent a high percentage of the outgoings of the train operating companies and therefore impact on the amount of subsidy paid by the Government towards train services or the premium offered by operating companies on profitable routes. The ROSCOs are currently subject to a market investigation by the Competition Commission, instigated by the Department for Transport, which is due to make its final report before the end of this year.

In spite of this investigation, which could result in some price regulation - but is generally not expected to - the ROSCOs continue to be interesting opportunities for financially sophisticated businesses. Angel Trains was put on the market by its owner RBS in the autumn and a select list of shortlisted bidders including Deutsche Bank, Macquarie and Babcock & Brown are expected to make best and final offers later this month. In addition to coming up with a price that is attractive to RBS, they will need to refinance most of the portfolio, which means that there will be roles for many banks at that level.

When the Spanish bank Santander acquired Abbey in 2004 it soon became apparent that it did not see Porterbrook as fitting with the future shape of the group and a preferred purchaser for the ROSCO is expected to emerge later this year. That would leave HSBC to follow suit with the sale of HSBC Rail, although whether it will do so is not yet known.

So, as you travel on a re-liveried train or on any other passenger train run by a franchise operator, in almost all cases it will be owned by either Angel, HSBC Rail or Porterbrook. As far as you are concerned as a passenger, the responsibility for the train, including delays to your journey due to faults with the train, is with the operator. Exactly which bank or other organisation owns the ROSCOs and consequently whose trains you are actually travelling on is likely to change during 2008.

Mary Bonar is head of rail and Martin Fleetwood a senior associate in the transport financing practice at Stephenson Harwood.

It seems impossible to think that a city could have a secret underground rail system, but that’s the case with these four subways hidden beneath some of America’s biggest cities.

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