Federal Power Commission v. Texaco, Inc.

PETITIONER: Federal Power Commission
RESPONDENT: Texaco, Inc.
LOCATION: Alabama State Capitol

DOCKET NO.: 386
DECIDED BY: Warren Court (1962-1965)
LOWER COURT: United States Court of Appeals for the Tenth Circuit

CITATION: 377 US 33 (1964)
ARGUED: Mar 25, 1964
DECIDED: Apr 20, 1964

Facts of the case

Question

Media for Federal Power Commission v. Texaco, Inc.

Audio Transcription for Oral Argument - March 25, 1964 (Part 1) in Federal Power Commission v. Texaco, Inc.

Audio Transcription for Oral Argument - March 25, 1964 (Part 2) in Federal Power Commission v. Texaco, Inc.

Earl Warren:

Mr. Wahrenbrock, you may -- I think you had finished -- you'd --

Howard E. Wahrenbrock:

I believe I have two minutes, Your Honor.

Earl Warren:

Alright.

Two minutes, I won't argue about that.

Howard E. Wahrenbrock:

Well, in those two minutes, I think that it is an opportunity after having had a few moments to let the thoughts spill on over us as they have been coming at us for two hours.

To recollect that the key issue in this case is the power of an agency directed by a statute not to promulgate any rules going to either rights or contracts which will be effective in the future without holding a hearing and developing an evidentiary record.

The issue then is the power of that agency despite that statute to hold such a hearing that does not provide for a record or the development of those facts.

This was an issue that has come up once before.

It did not get as far as this Court but it was actively litigated in the District of Columbia Circuit.

Before 1960, the Federal Power Commission issued its general policy statement in which it promulgated prices for some 23 areas in the country.

And in that general policy statement, it provided for specific prices.

And the consumers of natural gas felt that they did not like those prices and they challenged the issuance of that policy statement in the Court of Appeals.

And there the court said, “But this is only a matter of policy.

There has been no hearing.

The Commission cannot promulgate prices without a hearing.

The avenues of recourse and the development of facts must be kept open as they are here under this policy statement.”

“But the statement, “said the court, “may stand.”

So, these rules may stand as policy only.

Thank you.

Tom C. Clark:

How do you reconcile Wisconsin with your position?

Howard E. Wahrenbrock:

The lower court in Wisconsin held exactly this --

Tom C. Clark:

Not in the -- this Court on those general policy statements.

Howard E. Wahrenbrock:

This Court merely affirmed what the lower court had said Your Honor that the policy statement prices were no more than guidelines just as the Tenth Circuit below here has permitted these prices that I held up earlier to be statements of the Commission's policy to let the industry know generally how the Commission feels about these clauses.

But obviously --

Tom C. Clark:

They are ceilings (Inaudible)

Howard E. Wahrenbrock:

Excuse me Your Honor?

Tom C. Clark:

They are in effect the ceiling on the price, aren't they?

Howard E. Wahrenbrock:

The prices?

Tom C. Clark:

The -- general policy.

Howard E. Wahrenbrock:

No, Your Honor, they are not.