RESPONDENT: United States
LOCATION: LaSalle Street Station
DOCKET NO.: 6
DECIDED BY: Warren Court (1957-1958)
CITATION: 355 US 141 (1957)
ARGUED: Oct 23, 1957
DECIDED: Dec 09, 1957
A. B. Howland - for the intervening appellee Rock Island Motor Transit Co.
Edward J. Hickey, Jr. - for the appellant Railway Labor Executives Association
Peter T. Beardsley - for the appellant American Trucking Associations, Inc.
Robert W. Ginnane - for the appellee Interstate Commerce Commission
Facts of the case
In 1938, the Interstate Commerce Commission authorized Rock Island Motor Transit, a subsidiary of the Chicago, Rock Island and Pacific Railroad, to purchase the property and rights of the White Line Motor Freight Company between Silvis, Illinois and Omaha, Nebraska. The certificate limited motor operations to service to or from points on the Rock Island Railroad, subject to any restrictions the commission might impose under the Interstate Commerce Act to insure that the service was auxiliary or supplementary to train service. The Act authorized consolidation, merger, acquisition, or lease of common carriers if the commission deemed it to be “consistent with the public interest.” In a separate section, Congress directed the commission not to certify a railroad corporation seeking to operate motor carriers unless it also found that the railroad would use motor vehicle service to public advantage in its operations and would not unduly restrain competition.
In 1944, Rock Island purchased the Frederickson Lines, covering routes between Atlantic, Iowa and Omaha, Nebraska. Rock Island filed for permission to provide motor service to points along the Frederickson Lines. The commission granted Rock Island permission, but placed five conditions on motor service for both the White and Frederickson routes. Rock Island challenged the conditions in district court and won, but on appeal, the Supreme Court upheld the commission’s power to impose the conditions.
Rock Island then filed for permission to provide unrestricted motor service to points along the White and Frederickson lines. In 1954, the application was substantially granted. American Trucking Associations, Inc., nine other motor carriers, a group of railway trade unions, and several other organizations intervened, arguing that 1) the commission was required to limit motor service by a rail-owned motor carrier to auxiliary or supplementary service, and 2) the evidence was not sufficient to support the commission’s certification order. The district court upheld the certificate as granted.
1. Did the Interstate Commerce Act preclude the Interstate Commerce Commission from issuing a certificate authorizing motor-carrier operations to a subsidiary of Rock Island and Pacific Railroad Company because the parent company was a railroad corporation?
2. Was the Interstate Commerce Commission’s conclusion that public interest required the continuation of service by Rock Island Motor Transit Company supported by substantial evidence?
Media for American Trucking Associations, Inc. v. United StatesAudio Transcription for Oral Argument - October 23, 1957 (Part 1) in American Trucking Associations, Inc. v. United States
Audio Transcription for Oral Argument - October 23, 1957 (Part 2) in American Trucking Associations, Inc. v. United States
Mr. Howland, you may proceed.
Alden B. Howland:
May it please the Court.
At the time of the recess, I was discussing the fact that there was complete absence of any evidence in this record that would justify the conclusion that the operations of Rock Island Motor Transit Company had in anyway been harmful to the so-called independent motor carriers.
Now, that is demonstrated in a number of ways.
First, it appears without dispute in this record that all of the independent motor carriers in the area have increased their traffic in the 10 years or nine years immediately preceeding the hearing at a much greater rate than have the -- then has Rock Island Motor Transit Company.
The Rock Island Motor Transit Company has an increase of roughly 50% in its gross volume of tonnage handled during that period, whereas some of the competitors who are appellants here in this case have increased the volume of revenues and tonnage handles by as much 300%.
And we think that, quite inclusively, demonstrates that there's no basis for the claim that the operations of Rock Island Motor Transit Company while they were conducted on a nonrestricted basis were predatory in nature or in any manner that it interfered with the logical development of the motor carriers.
Now, it also appears in this record and there is no dispute about that fact and no evidence to the contrary that during the time since the Rock Island Motor Transit acquired the White Line routes that Rock Island Motor Transit has cooperated with motor carriers.
Some of its officers and employees have served on the rate bureaus.
They have participated in the motor carrier organizations and have been highly regarded by the other motor carriers, some of whom are appellants in this case.
And there's not syllable of evidence to the contrary.
Now, I believe it was Mr. Justice Harlan who propounded it to Mr. Ginnane, a question as to whether there was anything in the briefs that indicated the extent to which the Commission, in prior cases, had granted unrestricted motor carrier authority to rail subsidiaries.
At pages 17 and 18 of our brief, we set forth, I believe, its 12 separate instances beginning with the Santa Fe Trail Stages case and including St. Andrews Bay down to the Southern Pacific control of Pacific Motor Trucking purchase of Lowa Trucking Company in which the Commission said that because of the circumstances that were disclosed in the particular record that they found it unnecessary to impose any restrictions upon the operations of rail subsidiaries.
Now, as cited, there are two cases in which Rock Island Motor Transit itself was granted unrestricted authority.
One, being a short route between Wellman and Iowa, City of Iowa serving, I believe, two intermediate points and one between Clinton Davenport and Muscatine, Iowa which were rail routes -- rail points and as to which in an -- in a -- an acquisition case.
The -- no conditions were imposed.
We have had other instances such as the Atlantic Motor Freight case which was not reported in the MCC reports of the Commerce Commission where no restriction -- restrictions were imposed.
Mr. Howland, I wonder I might ask, why -- why there's a new proceeding initiated here rather than to pursue a modification that the longstanding orders that have -- had been made in this case.
Alden B. Howland:
Well, frankly, it was the dealing of those who were handling the matter, including myself, that there would probably be a greater degree of evidence admissible and a greater flexibility in the -- in the showing that we wanted to make if we proceeded under Section 207.
And I think as I recall that there was a suggestion or two from the Commission staff that we might as well open the whole thing up.
And it was upon that basis that we filed an application first in accordance with the restriction which had been imposed to 5000 pounds maximum weight limitation and later we amended that when we found that through practical experience that it was unworkable and it was not serving the communities to which the Rock Island Motor Transit had the only operating authority.
Now, just one for the -- have I answered your question?
Yes you did.
Hugo L. Black:
Supposed they had none of the application filed immediately after the approval of the acquisition and you had filed a new application from the 207 do you have that written down and get changed right away?
Alden B. Howland:
Well, I don't think that the -- that you can circumvent the provisions of Section 5 (2) (b), I think, that it's absolutely necessary that the Commission make the finding that is set forth there.
But I say that the Commission in its discretion having made that finding, having approved the acquisition, the extent of the limitations or restrictions which are to be imposed, if any, is a matter, I believe, within the sound discretion of the Commission and where the evidence --
Hugo L. Black:
Did they make the finding under 5 (2) (b)?
Alden B. Howland:
They made the findings in 1938, all findings required.
And they made additional findings, of course, in 1954, when they ordered that certificate issue.
The certificate has not yet been issued to us.