United States v. Allegheny-Ludlum Steel Corporation

PETITIONER: United States
RESPONDENT: Allegheny-Ludlum Steel Corporation
LOCATION: Stanford University

DOCKET NO.: 71-227
DECIDED BY: Burger Court (1972-1975)

CITATION: 406 US 742 (1972)
ARGUED: Mar 27, 1972
DECIDED: Jun 07, 1972

Max O. Truitt, Jr. - for appellees
Samuel Huntington - for appellants
William M. Moloney - for appellees

Facts of the case


Media for United States v. Allegheny-Ludlum Steel Corporation

Audio Transcription for Oral Argument - March 27, 1972 in United States v. Allegheny-Ludlum Steel Corporation

Warren E. Burger:

First this morning in number 71-227, United States and Others against Allegheny-Ludlum Steel Corporation.

Mr. Huntington you may proceed whenever you are ready.

Samuel Huntington:

Mr. Chief Justice and may it please the Court.

This case is here on direct appeal from a three-judge District Court sitting in the Western district of Pennsylvania.

The question presented is whether the District Court erred in adjoining the enforcement of two car service rules adopted by the Interstate Commerce Commission to govern the movement of freight cars.

The rules were promulgated under Section 1 (14) (a) of the Interstate Commerce Act which authorizes the Commission to establish reasonable rules with respect to car service.

For more than a century, railroads have freely interchanged freight cars so that freight could be shipped from point of origin to point of destination on a single car.

To govern the return of freight cars through their owners, railroads as early as 1902, adopted a code of car service rules.

Similar rules are now published by appellee, the American Association of Railroads for AAR and virtually all railroads in the country have agreed to abide by that.

The railroads Record of Compliance with the AAR car service rules however has been poor particularly during times of general freight car shortage.

The Commission in this case determined that a number of the AAR rules should be enforced and thus adapted them verbatim as Commission rules.

The two rules here under attack, rules 1 and 2, generally require that unloaded freight cars be returned either empty or loaded in the direction of the railroads owning the cars.

Freight car shortages have been a serious and recurring problem throughout most of this century.

In the 1940s for example, the Commission concluded after a general investigation that railroads as a group had failed to provide adequate freight car service.

The Commission at that time did not adopt mandatory rules in the hopes that the railroad would take steps to solve the problem themselves.

By the the 1960s however, it became apparent that the problem was getting worse.

Clearly voluntary action by the railroads had not provided the solution.

To meet the crisis, the Commission acted on a number of related fronts.

These actions included adjusting their per diem charges that one railroad pays for the use of another's cars, enforcing the requirement that boxcars be free of debris when unloaded and the sponsoring remedial legislation.

The Commission's attempt to add an incentive element in the per diem charges is a subject of another appeal pending before this Court, it's the Florida East Coast Railway appeal, no. 70-279.

The instant case was initiated by the Commission to investigate all aspects of freight car shortages and to consider the prescription of mandatory car service rules.

The evidence in this case showed that the total number of freight cars owned by railroads declined from 1955 to 1964 by more than 12%.

While the individual capacity, the average capacity of individual cars increased during that period, the aggregate capacity of all cars also declined by 5%.

The decline was shortest more than 22% with respect to plain boxcars.

Plain boxcars which make up about one-third of the number of freight cars in the country are the workhorse of the car fleet.

Many railroads and practically all the shippers participating in these proceedings acknowledge the existence of a chronic national freight car shortage.

In fact, appellee, that's the National Industrial Traffic League testified, a witness testified that the number of freight cars in the long run should be doubled in order to meet the needs of the shippers.

To combat the shortage and dislocation of freight cars, the Commission's Bureau of Operations proposed that certain car service rules be made mandatory.

Appellees have attempted to paint a picture of virtual uniform opposition to the imposition of mandatory rules.

In fact however, some railroads and more than some shippers testified that enforceable car service rules were needed.