CONCORD – Pan Am Railways has banned Milford-Bennington Railroad owner Rep. Peter Leishman from driving his trains on their tracks for life, following a collision that police found was not his fault.

Pan Am officials conducted their own investigation, however, and concluded that Leishman had violated safety regulations by failing to get down off his train and flag traffic.

The ban applies only to Leishman but is problematic for his company.

Leishman is one of two full-time employees, and his 24-mile Milford-Bennington line ends in Wilton – three miles short of the Milford gravel processing plant used by its sole customer, Granite State Concrete. The rest of the trip takes place on Pan Am lines.

The ban’s effect on the rail line has forced Granite State Concrete to shut down a quarry and stone processing plant in Wilton. The company is hauling stone and gravel from other quarries to Milford by truck.

“We’re very disappointed that we don’t have any rail service. … It affects our operations in a negative fashion,” said John MacLellan, president of Granite State Concrete.

MacLellan declined to discuss details, however, saying he didn’t want to get involved in a clash between the two railroads.

Leishman and Pan Am President David Fink have been fighting over rights to the rails since the late 1980s, when Leishman took over the line abandoned by Pan Am’s predecessor, Guilford Transportation.

Leishman won the rights to use the 3-mile stretch track from Wilton to Milford in 1992.

Pan Am’s ban on Leishman follows a particularly bitter episode, in which Fink claimed that Leishman abused his power as a state legislator while negotiating the renewal of his lease with the state on the Milford-Bennington line.

That brouhaha blew up while state officials were seeking federal funds to plan a commuter rail line linking southern New Hampshire to the Massachusetts Bay Transportation Authority. Pan Am officials ultimately blocked the program, saying they couldn’t trust state lawmakers.

The battle of the ban began in Merrimack County Superior Court but has since moved to U.S. District Court, where Judge Paul Barbadoro has been unable to persuade the railroads to iron out the issues on their own.

The dispute looks likely to play out before the court over the next year or two; Leishman and his lawyer have asked to bring the case to trial May 15, while Pan Am contends it couldn’t be ready until Jan. 30, 2012.

In addition to overturning the ban, Leishman’s suit seeks compensation for legal fees and lost revenue.

“We’ve lost, collectively – Granite State and the railroad – hundreds of thousands of dollars,” Leishman said Thursday.

Fink could not be reached Thursday morning for comment.

The dispute between Pan Am and Leishman ostensibly stems from a collision between one of Leishman’s trains and a flatbed tractor-trailer truck, where the tracks cross Route 101A, near the junction of Route 101, on Oct. 22, 2009.

No one was hurt in the crash, and the truck driver, Eric Macias of Milford, was later summonsed for failing to stop at a railroad crossing. The train had activated the signal lights at the crossing (which also turns all traffic lights red), and sounded its air horn as it approached, witnesses told police.

Leishman and his engineer, David Raymond, saw that the truck wasn’t stopping and hit the emergency brakes, but they were unable to stop the train in time to avoid a collision, Leishman told police. The crash damaged the caboose and at least one hopper car and tied up traffic for hours, police said.

Pan Am Railways police also concluded the crash was the truck driver’s fault, according to Leishman’s suit, but Pan Am Railways decided to conduct a hearing on the incident on Nov. 10, 2009. Leishman didn’t attend the hearing, as he wasn’t notified in time, his suit states.

Leishman learned only on April 9, 2010 that Pan Am Railways had permanently banned him from operating trains on its tracks, and he persuaded Pan Am to reopen the hearing, arguing that the decision was “entirely inconsistent with the evidence offered during the initial hearing,” his suit states.

Pan Am conducted further hearings but didn’t change its decision. Pan Am alleges that Leishman violated a Northeaster Operating Rules Advisory Committee rule requiring train operators to stop and send out a flagger into intersections to warn traffic. Leishman argues that both NORAC and the Federal Railroad Administration agreed the Elm Street crossing doesn’t require flaggers, but he said he has offered to use them anyway, if Pan Am insists. The process makes crossings much longer and would thus wreck havoc with traffic, Leishman said.

Leishman’s suit claims that Pan Am’s ban appears to be a ploy to shut down his business. Pan Am has suggested Leishman hire someone else to do his job, but Leishman says that would be too expensive.

In 2009, Fink claimed that Leishman abused his political clout as a legislator while negotiating a renewed 10-year lease with the state for his Milford-Bennington line. Pan Am had sought to bid on the line, which Leishman had been running for 20 years.

The state Legislative Ethics Committee cautioned Leishman against blurring his roles as business owner and state representative, but ruled in February 2010 that he hadn’t violated ethics rules. Leishman no longer serves in state government, having lost a re-election bid in November.

Fink later cited the lease renewal dispute and his dissatisfaction with the state’s response, as a reason for refusing to support the state in planning a passenger rail program in southern New Hampshire.

Andrew Wolfe can be reached at 594-6410 or awolfe@nashuatelegraph.com.