Western Pacific Railroad Company v. United States

PETITIONER:Western Pacific Railroad Company
RESPONDENT:United States
LOCATION:Juvenile Court

DOCKET NO.: 12
DECIDED BY: Warren Court (1965-1967)
LOWER COURT:

CITATION: 382 US 237 (1965)
ARGUED: Oct 19, 1965
DECIDED: Dec 07, 1965

Facts of the case

Question

Audio Transcription for Oral Argument – October 19, 1965 in Western Pacific Railroad Company v. United States

Earl Warren:

Number 12, Western Pacific Railway Company et al., Appellants, versus United States.

Walter G. Treanor:

Mr. Chief Justice, I move the admission of Paul Bender of the District of Columbia Bar for purposes of arguing this case on behalf of the United States.

Earl Warren:

Does it make it (Inaudible) for that purpose.

Mr. Treanor.

Walter G. Treanor:

Mr. Chief Justice, may it please the Court.

My co-counsel E. Barrett Prettyman, Jr. and I represent the Western Pacific Railroad Company and its subsidiary lines, the appellants in this matter.

This case arises under the provisions of Section 3 (4) of the interstate Commerce Act, which in part prohibits the practice of railroad rate discrimination between connecting lines.

Western Pacific charges railroad appellees with such a practice against them.

The map placed before the Court is an enlargement of the map which railroad appellees included in their brief herein.

We hope that it may prove helpful in describing the basically simple factual situation.

The Pacific West Coast is served generally by only two North, South Railroad routes, which are directly competitive one with the other.

These two routes are the Southern Pacific between Portland and Los Angeles which are shown in Brown and its connection with the Santa Fe from Stockton South to Los Angeles on one hand and the so-called, Bieber route which is made up of the purple Great Northern from Portland to Bieber, the Western Pacific in red from Bieber to the Stockton, San Francisco, Oakland Bay area and Atchison, Topeka and Santa Fe in green south to Los Angeles.

Both routes extend between Southern California and Portland, Oregon and both routes physically connect with Railroad appellees at Portland.

Both routes served the same general territory in this area and all major shipping points.

The Bieber route was under the specific authorization of the Interstate Commerce Commission completed in 1931.

As described, it consists now as it did then of the end-to-end connections of the three specifically described railroads.

Southern Pacific route was constructed first and for almost 20 years was the only north-south rail route in this territory.

The construction of the Bieber route was for the declared and avowed purpose of establishing for the first time a service fully competitive with the event existing Southern Pacific route.

Railroad appellees which served the territory North to Portland up in Oregon, Washington and Western Idaho by establishing and maintaining a full line of through service rates with Southern Pacific via Portland while at the same time refusing to enter into similar arrangements with the Bieber route have forted and frustrated the competition between these two routes.

With the result that on all traffic moving to or from the appellee’s territory, the Southern Pacific has a virtual monopoly as a practical manner than using one of the many illustrations, which appear in the record.

If the shipper at Seattle located on the lines of Railroad appellees, make the shipment from Seattle destined to San Francisco, California and the discrimination did not exist, we would be fully competitive at Portland for the movement south from the point of common interchange.

But because of the rate discrimination, the shipment must move South of Portland on the Southern Pacific route even if it is destined to an industry served exclusively by the Western Pacific Railroad in the San Francisco area.

And the same situation prevails in the opposite direction.

The need for competitive service, which in 1931 required establishment of the Bieber route, is manifestly more pronounced today.

In January of this year, the Interstate Commerce Commission rejected the separate efforts of both Southern Pacific and the Santa Fe to take stock control of Western Pacific pointing to among other factors the critical need of Western Pacific to remain as an independent effective competitor of Southern Pacific Company with particular emphasis on its operations via the Bieber route.

The division — the decision of the Commission also pointed to the relative ineffectiveness of the competition provided in this territory by other modes or forms of transportation.

Efforts to abate the discrimination have been unavailing because both the Commission, contrary to the findings of its hearing officer, and the lower court determined that Western Pacific was not a connecting line with appellees, because one, it is not the partner in the Bieber route which enjoys the physical connection with appellees at Portland, and in the alternative Western Pacific does not now have by grace of railroad appellees what they have classified as a business connection with them.

Both the Commission and lower court rely upon Atlantic Coast Line versus United States.

It is our contention that they have wholly misconstrued that case which is not only contrary to what they believe it holds, but in fact, supports the right of a carrier located as is Western Pacific here to seek and obtain relief under the provisions of Section 3 (4).

It does not require any liberalization of the present interpretation of the term connecting lines to so hold.

Walter G. Treanor:

Not only is this so under the doctrine of Atlantic Coastline but under every other pronouncement of this Court on the subject and especially under the decision in Chicago, Indianapolis & Louisville Railroad versus United States.

After the Commission hearing examiner in this case had heard all of the evidence first hand.

He cut through all of the extraneous argument and held for Western Pacific in what we believe are simple, clear and positive findings.

His summation at page 654 of the record herein was and I quote, “There is no justification in this record for such treatment of a connecting line.

The granting of a full line of rates to one railroad and an interchange point while at the same time limiting the extent of such rates to the favored lines’ competitor is the essence of discrimination.

It is the type of unlawful discrimination Section 3 (4) of the Act aims to prevent.”

The appellant’s definition of a connecting line comports with a clear legislative intent and is fully consistent with this Court’s repeated their determination that and I quote from page 594 of the Chicago, Indianapolis & Louisville decision, “Wherever discrimination is in fact practiced an order to remove it may issue and the order may extend to every carrier who participates in inflicting the injury.”

That was the case which arose under Section 3 (4) of the Act.

The appellees would not question as shown from the pleadings they have filed with this Court.

Western Pacific standing here as the connecting line, if appellees already joined us in through rates on a level somewhat higher than they maintain with Southern Pacific.

Yet they seriously contend that their flat refusal to join on any level constitutes the complete defense.

That cannot be the law as Congress intended it nor as this Court has repeatedly interpreted it.

Section 3 (4) is designed to assure the shipping public of the opportunity of choice between comparable, fully available service and the decision as to which to use is properly theirs, the shipping publics and not that of the carrier which is practicing the discrimination which is prohibited.

As covered in our briefs, the position we take is fully supported by the legislative history, the case history, and the factual and the competitive situation here prevailing.

Everyone on both sides of this case agrees that the two pivotal cases are Atlantic Coastlines and Chicago, Indianapolis & Louisville.

We agree with the United States that Chicago, Indianapolis & Louisville clearly require an end to the discrimination.

Atlantic Coastline, we say, supports our concept of connecting lines status.

Just as in the instant case now before the Court, one of the complaining carriers there did not have physical connection with the line practicing the discrimination.

At the first opportunity, the discriminating carrier took positive steps to make it clear that it was not holding out a through service with that carrier and this Court held that action to be unlawful.

The Court required the Clinchfield, which in this — in that case was in the position of the appellees here to be maintained as a neutral carrier treating its common connecting lines equally in the matter of rates.

Such neutrality would not have been possible at all if the Clinchfield had been allowed the unilateral right to determine the extent of its rate participation with these connections.

There was no requirement in that case of a pre-existing rate arrangement through the point of interchange.

The Court was clearly in interested in the arrangements which existed to the point of common interchange.

However, even had the Court than talking of an arrangement in the sense of one through the point of interchange, it was not in some technical through route sense that appellees used the term here, for the fact is that in Atlantic Coastline, there was no deliberate intentional, voluntary holding out of service by all participants.

In fact, exactly the opposite was the case.

The offending carriers there were taking every possible affirmative step available to them to prevent and disavow any such holding out.

So therefore, properly construed, the key cases make it clear that Western Pacific position is sound and consistent with the present status of the law and that if we are determined to be a connecting line for the first time since the Bieber route was constructed, it will fulfill the purpose which the Commission and the public had in mind what it had the route constructed and that is to provide full competition.

Potter Stewart:

Mr. Treanor, I understand your point that the Commission gave far too narrow a definition to the phrase “connecting line”.

What would your definition be of it?

Walter G. Treanor:

Mr. Justice Stewart, our definition would be this, if a line has a physical connection, it is obviously a connecting line.

Walter G. Treanor:

In the alternative, if it is part of a route which does have a physical connection with the discriminating carrier, if that route of which it is a part is directly competitive with the favored line and if all of the participants in the route, south of point of interchange are ready, willing and able to perform the full common carrier service in conjunction with the discriminating line, then I say, it is a connecting line under the statute and the decision.

Potter Stewart:

That’s a tailor-made definition for this case, of course.

Walter G. Treanor:

Yes sir.

I think they’re other —

Potter Stewart:

Including even a direction south.

I suppose it could be north —

Walter G. Treanor:

Yes Sir.

Mr. Justice Stewart, I also point out that in addition, there are even greater factors here.

In this particular case, such as the fact that they are immediately parallel one to the other and the history of the routes deals with their purpose.

There a fact is in our situations here, which go even beyond and make our case even more pronounced than the definition that I suggested to the Court.

Well, is there application made by the Commission for the joined through route rate on the Bieber line?

Walter G. Treanor:

Excuse me, Mr. Justice Harlan, you mean at the time that the route is constructed?

Well, subsequently.

Walter G. Treanor:

The — they were several proceedings which preceded our case that which is here.

The —

My understanding was that the Commission had rejected an application at some stage rather that —

Walter G. Treanor:

What had happened, Your Honor, was that when we first brought this compliant we alleged violations of Section 3 (4) as well as violation of Section 1 (4).

Before the case was submitted to the examiner, we took the position in our brief to the examiner that we would be satisfied with a finding under Section 3 (4).

We did not press our Section 1 (4) beyond that point.

Now, the Commission, when it got to the decisional level here did make a ruling against us on Section 1 (4) but we had not been pressing that all.

I would like to reserve the balance of my time for rebuttal, if it please the Court.

Earl Warren:

Mr. Bender.

Paul Bender:

Mr. Chief Justice, may it please the Court.

Untied States although nominally an appellee in this proceeding, does not support the decision of the ICC and the District Court holding at the Western Pacific is not a connecting line or part of the connecting line and is therefore unable to invoke Section 3 (4) the Act, to remedy the alleged discrimination in this case.

United States attempted to intervene in the proceedings before the Commission to present these views and it did not support the position if the ICC that Western Pacific was not a connecting line before the District Court.

In our view, the Western Pacific is either a connecting line itself or part of connecting line that is a Bieber route, and the correct disposition of this case would be for the Court to remand it to the District Court for consideration of the allegations of discrimination which Western Pacific has made and which the District Court did not pass on because the District Court found Western Pacific not to be a connecting line.

Now, as I say, we disagree with the definition of the Commission and the Court as to what a connecting line is, and I’ll try to show in a few minutes, why we disagree as a technical matter of definition.

Our interest though in the case is a much more serious than a question of dry legal definition.

It’s the economic impact of the Commission’s decision, which we are principally concerned with.

We’re concerned both as in our capacities as shipper that the definition be adopted in very important railroad routes between Southern California and the Northwest, and also in our sovereign capacity our interest in maintaining free competition between existing railroad routes when that competition is natural.

Paul Bender:

We think the definition adopted does just the opposite.

Potter Stewart:

Ultimately, this case does carry, does it not, on what you referred to as the dry legal definition?

Paul Bender:

Yes, it does and I shall address myself to that.

Let me, if I may, talk to say just a few words about the economic effect which we think the definition leads to and which we think is improper.

In this case, the discrimination of the defending law of the Northern Pacific and the Union Pacific up in the Northwest.

Their discrimination in favor of the Southern Pacific Group essentially gives the Southern Pacific a monopoly in traffic that between all points in California, which they serve, and points on the Northwest served exclusively by the defendants.

That is any of these cities in here, which is served only by Northern Pacific or the Union Pacific.

If you are a shipper in Los Angeles, and you want to ship to one of these cities, you would only ship on the Southern Pacific even though your plant may have equal access to the Western Pacific and therefore to the Bieber route because on the Southern Pacific, you get a joint rate which is lower than a combination rate at you pay on the Western Pacific.

Now, that’s not true.

If the point to which you’re shipping lies on the Great Northern as well as on the defendant roads because the Great Northern maintains joint rates both with the Southern Pacific and with the Bieber route then therefore the rates on points on cities lying on the Great Northern.

If you ship via the Great Northern are equal on either route.

But, if you see, if the city to which you’re shipping, or if you’re receiving goods from a producing area up here, if that city lies only on one of the defendant lines, then the Southern Pacific has a monopoly because the defendants have deliberately favored the Southern Pacific by entering into joint rates with it and not with the Bieber route carriers.

We think that this definition is obviously inconsistent with the general purpose of the statute.

Congress made it quite clear that that general purpose was to prohibit discrimination and all its forms, and this, it seems to us, is a very harmful type of discrimination which ought to be prohibited.

Also, I’d like to make this point now, the definition which has been adopted is adopted solely by reference to the Atlantic Coastline’s case which the Commission takes a few sentences out of the pieces together with other decisions and says they’re compelled to reach the decision that Western Pacific is not a connecting line.

The definition is not made with reference to the purposes of the Act, to the reasons run anti-discrimination provision.

It’s made solely by reference to this precedence.

We think that the precedence have been wrongly used by the Commission and by the Court and I think I can show that.

But it seems to us quite important that the definition here respond to the purposes of the Act and not be done in this mechanical way for piecing together a sentence from one case with a sentence from another.

One final point is preliminary to defining the word.

Under the Commission’s view of the case in the District Court, it is never suggested that there isn’t a violation of Section 3 (4) in this case.

That is, Section 3 (4) prohibits discrimination between connecting lines.

There’s no question in this case that a connecting line is being discriminated against everyone can seem that the Northern, the Great Northern which is this purple road here, which concededly has a physical connection with the defendants at Portland is a connecting line, that’s true under the narrowest possible definition of the language which would be physical connection.

So, the defendants, if the allegations of discrimination true and I think that we have to take to construe in this proceeding.

The defendants are clearly violating Section 3 (4) of the Act.

The only question in the case as well as the Western Pacific has standing to raise the objection.

There’s no question as to the being in violation of the Act.

Actually, yes sir.

Byron R. White:

(Inaudible)

Paul Bender:

Only if it’s discriminatory.

Byron R. White:

(Inaudible)

Paul Bender:

Well, another —

Byron R. White:

Let’s assume that the Great Northern — Great Northern came into the (Inaudible) would that be a violation subsequent to 3 (4)?

Paul Bender:

Well, if it didn’t —

Byron R. White:

(Inaudible)

Paul Bender:

Well, the section only deals with discrimination in rates, fares and charges between connecting lines.

If the formation of the through route had no effect on the rates, fares, and charges, I take it; it wouldn’t come within Section 3 (4).

Byron R. White:

(Inaudible)

Paul Bender:

Well, there’s a general provision of the statute which gives us the Commission power to I think it’s, is it one?

Think it’s one-fourth, yes, but this case, that that provision applies regardless of whether there’s a competing line which you say being favored that is a section invoked in this case applies only in discrimination situations and there, the Commission doesn’t have, isn’t given by the statute the discretion to decide whether it’s in the public interest to form the through route.

Byron R. White:

So in my case (Inaudible)

Paul Bender:

I would think, in any case, there would be no violation of 3 (4) unless rates, fares or charges were involved.

Potter Stewart:

Before imposing a duty to maintain interchanges of traffic?

Paul Bender:

Yes.

Potter Stewart:

And I suppose to that extent that –-

Paul Bender:

Well, I — if by through route you mean that you let traffic go through, yes.

I think the principle significance of forming a through route is to have a joint rate applicable over the route.

Otherwise, I don’t see what the significance of the through route is.

(Inaudible)

Paul Bender:

Well, I think the principal separation is that 3 (4) is a discrimination provision and it applies automatically and the Commission has no function of finding whether it’s in the public interest to establish the routes and rates.

Whereas this 1 (4) applies when there is no discrimination, I mean, you —

Byron R. White:

(Inaudible)

Paul Bender:

Yes, there is that distinction.

Well, coming in to the question, the definitional of question in the case, that is, what does connecting lines mean and it’s the Western Pacific a connecting line or is it a part of a connecting line?

The term is nowhere explicitly defined in the statute.

As a matter of statutory language alone if you just look at the statute, it might mean just direct, physical connection.

That is it might mean only lines which directly connect with the defendants.

Even if you adopted that definition, it would still be the problem of what you meant by a line which connected with the defendant, did a line in a railroad company or did a line mean a group of railroad companies which form a unit of railroad transportation.

In any case, this question of whether physical connection is the meaning of connecting lines was settled long ago in the Atlantic Coastline’s case.

So there’s never any doubt about it.

Paul Bender:

It was settled in that case that connecting lines that is not refer merely to physical connection.

The Court said, there is no warrant for limiting the meaning of connecting lines for those having a direct physical connection with the carriage or to discrimination.

The term is commonly used as referring to all the lines making up a through route.

Well, if it goes beyond the physical connection, you’ve got to decide how far beyond that it goes.

What we suggest as most consistent with the obvious purpose of the Act to remedy cases of discrimination is that it refers not to connecting particular railroad companies, that is railroad companies which have a physical connection with the defendant.

But that it refers to connecting units of railroad track connecting routes, connecting functional units of railroad transportation.

If you discriminate between those, it doesn’t matter how many railroad companies you have making up the unit that connects, the route that connects.

You still in violation of 3 (4) and any one of those companies along the route can invoke the section against you.

For example, if this case had been turned around exactly, suppose the defendants favored the Bieber route and discriminated against the Southern Pacific, there’d be no question of the Southern Pacific can complain.

It’s a single railroad company.

There would also be no question of the Southern Pacific could complain if the discrimination against it only applied to its bottom track near Los Angeles.

Now, supposed that they offered through rates up to San Francisco.

But below San Francisco, they wouldn’t because they were trying to favor the Atchison, Topeka and Santa Fe which serves between San Francisco and Los Angeles.

Although they didn’t mind having the Southern Pacific competition with the Western, they didn’t want it to be in competition with the Atchison, Topeka and Santa Fe.

Well, even in that case, there’s no question that the Southern Pacific have used Section 3 (4), I take it the Commission has no doubt about that.

It has a physical connection up here and as a single railroad company, it goes all the way down.

Well, if that’s true, we can see absolutely no reason why the results should be any different if Southern Pacific would’ve divest itself of the last hundred miles of its road and to a different corporate entity, a separate corporate entity.

What’s the difference?

Who owns the track of the road?

The fact is that it’s a single railroad route.

The whole of the route is being discriminated against and any part of the route can complain.

Certainly, you can complain about it if you own the whole route and we think if a company owns a part of the route, it ought to be able to complain.

The only question we —

Potter Stewart:

Where does that stop?

Every — doesn’t every line connect with every other line ultimately?

Paul Bender:

Yes, every line connects with every other line ultimately.

But what you’d have to show —

Potter Stewart:

In the Boston and Maine connects with the Southern Pacific under your —

Paul Bender:

Well surely, and if the Boston and Maine is being discriminated against in say it’s one of its competitors is being favored in the East and you have through route transportation across the United States and the Boston-Maine is at the end of one of those.

Potter Stewart:

Yes, you do, don’t you?

Paul Bender:

As one of its competitors as the end of the other is absolutely no reason why this section shouldn’t apply.

It applies whenever all the companies which form one of these groups do in fact form a route.

They join together to offer transportation.

Now, there may be questions in some cases whether in fact the unitary route is — exists up to the point of connection.

There’s no such question in this case because the Bieber route has acted as a unit ever since its formation.

The record is quite clear on the fact, that within the Bieber route, through routes exist and have existed for a long time.

In other words, if you want to ship from Los Angeles to Portland on the Bieber route, Atchison, Topeka and Santa Fe, Great Western, Great Northern through routes and joint rates are in effect along the Bieber route.

It’s only if you want to go beyond there that you don’t get a joint rate with the defendants, but you do get a joint rate up until Portland.

So that Mr. Justice Stewart, there’s no question in this case that this is a unit and it is a route and ought to be treated as one.

Now, we suggest in the brief that the definition ought to apply beyond that.

The case is where even though the route doesn’t friendly exist the to Portland, all of the participants in the route express their willingness, as they have in this case, to join in the routes through the point of discrimination.

They do that, it seems to us, that it shouldn’t matter what happened before so long as they are now willing to join the through transportation.

Abe Fortas:

Mr. Bender, I wonder if you could help me.

What are the practical implications of your position?

How much of a problem would that raise throughout the rest of the country?

In other words, can you describe in any way you give us some approximation of the extent to which problems occur throughout the country that would be affected by the definition of connecting lines that you have stated.

Paul Bender:

I know of no problem which would be created.

There haven’t been so far as I know a great number of this Section 3 (4) proceeding —

Abe Fortas:

No, I’m not talking about the proceedings instituted, I’m taking about the extent to which this would suggest that proceedings to be brought.

For example, the both Pennsylvania and the New York Central have transcontinental through rates that are satisfactory to them or would affect their problem, put it in another way would this affect the situation of every railroad in the United States which has a competing road in that particular area, one of the two roads having through rates with some other road or system.

Paul Bender:

Potentially, it would if you had two railroads in competition and some other railroads somewhere else in the country was offering joint rates with one of them and not with the other.

This would open the possibility of the other bringing a proceeding.

Now, under this —

Abe Fortas:

That’s what I want to know.

How extents in this situation can you estimate?

Paul Bender:

I can’t — honestly I can’t say, I don’t know.

I would doubt very much whether there would be too many instances where railroads would join and through rates was one road and refuse to do so as a competing road.

Ordinarily, there’d be absolutely no occasion for them to do so.

They’d want to get as much traffic as they could with no reason to offer it on one road and not another.

It’s just in this situation.

Paul Bender:

We don’t know why it’s true that the Union Pacific and the Northern Pacific’s for some reason have sought to favor the Southern Pacific over the Bieber route carriers.

Thereby, it’s of some substantial extent destroying the Western Pacific’s ability to compete.

Another, Mr. Justice Fortas, another problem which is some ways as unique to this case is that you have the concededly connecting road.

The road which everyone concedes, connects, the Great Northern not being a plaintiff in the proceeding if it were there’d be no question.

Now, again we don’t know why that is part of the several possibilities suggested so.Great Northern simply may not care enough because it shares with the Bieber route, it’s too small in relation to all the rest of its operation.

Western Pacific which has probably the greatest percentage-wise financial state in the Bieber route, it may be because Great Northern doesn’t feel litigation worth it’s while in the sense that it doesn’t want to destruct it’s relationships with these other roads.

Abe Fortas:

Well, on conventional basis of the ICC’s basis, if the Great Northern applied for a through route, through rates that would just extend through the Great Northern’s land, wouldn’t it?

Paul Bender:

I think not.

I think it would extend all the way to Los Angeles because the Great Northern is discriminated against and harmed by the failure of Union Pacific to enter into joint rates over the Bieber route to Los Angeles.

If you want to ship from up here to Los Angeles and if the Great Northern can only compel through rates to Bieber, if you go into Los Angeles, you’ll still ship over the Southern Pacific.

That discrimination then directly toward the Western Pacific equally harms the Great Northern to any traffic going beyond that.

Abe Fortas:

Can you tell me whether the — to your understanding that the ICC agrees with –-

Paul Bender:

It is yes, it is my clear understanding of the ICC agrees with that.

In the minute or two remaining to me, I’d like to say a word or two about the issue of discrimination which as I say we think ought to be remanded to the Commission to the District Court because the District Court didn’t consider.

However, in the footnote at the end of our brief, we discuss some reasons why we believe the Commission’s approach to the question is wrong.

The Commission seems to decide the question of discrimination simply by looking at physical configuration of the routes saying that if this route is longer that one, harder than that one, there can’t be any discrimination.

In short, we think that’s wrong.

The question of discrimination ought to be decided with regard to the defendant road, not with regard to the Bieber route of the Southern Pacific.

That is, they can justify not joining in through routes with the Bieber route if that hurts them, in some way, if it’s more expensive for example, that the connection with the Bieber route is more expensive than the connection with the Southern Pacific or if it would harm their goodwill to do so but, merely the fact that the Bieber route is a longer route, doesn’t seem to us to justify their refusal to join in through rates but at that choice whether the ship for wants to go on the longer route, the slower route, or the shorter more direct one, if that be the case here, we’re not sure it is.

But, if there is that difference, that choice, we suggest should be left up to the shipper.

Earl Warren:

Mr. Ginnane.

Robert W. Ginnane:

Mr. Chief Justice, may it please the Court.

I’m sharing the argument for the appellees with Mr. Farrell who is counsel for Northern Pacific, Union Pacific and Southern Pacific.

I’d like to address myself to a note which the appellants have left with the Court of monopoly or near monopoly north of California Railroad Transportation.

I think they should have pointed out that Western Pacific and Great Northern provide through transportation service on rates the same level as via Portland and Southern Pacific to such major traffics under as to Northwest served by Great Northern as Portland, Seattle, Tacoma and Spokane.

It’s far from a transportation monopoly.

Of course, there are local rail transportation monopolies particularly communities served by only one railroad line as there are all over the United States.

Now, also in terms of monopoly this theory of connecting line is now advanced for the first time since 1887, at a time, when the railroad transportation monopoly has largely disappeared.

This contention might have been more plausible, 1910 and 1920 when the rail monopoly was a real thing.

Turning to this case, the one question remaining since Western Pacific has abandoned its claim that the public interest requires the establishment of the routes which it’s on.

Robert W. Ginnane:

The one question is whether the Commission and the unanimous three-judge —

Byron R. White:

(Inaudible)

Robert W. Ginnane:

In the proceeding before the Commission.

Before the Commission, in their complaint they asked that they raised two issues.

They asked the Commission to find on the Section 15 (3) of the Act, that the public interest required the establishment of the through routes and the joint rates of which they desire.

The second prong and after a hearing of a presentation of evidence, the Commission found that they had not satisfied the burden of showing that public interest.

The second prong of their case presented their complaint before the Commission, was that they were entitled to rates on the same basis as the appellees had with Southern Pacific via Portland because they were a connecting line, so they urged, with the railroad appellees at Portland.

Byron R. White:

(Inaudible) Beiber route.

Robert W. Ginnane:

Bieber is a through route like participated in by Santa Fe, Western Pacific and Great Northern up to Portland and two points served by Great Northern.

William J. Brennan, Jr.:

(Inaudible)

Robert W. Ginnane:

No, like most through routes in this country, it’s by voluntary arrangements between the carriers.

The huge majority of through routes and joint rates have been worked out by collaborating carrier themselves.

Byron R. White:

(Inaudible)

Robert W. Ginnane:

No.

Byron R. White:

(Inaudible)

Robert W. Ginnane:

That is correct, sir.

Only the 3 (4) issues were litigated in the District Court.

There were two of those issues presented on the District Court.

First, the Commission’s holding that Western Pacific was not a connecting line.

Byron R. White:

Was not what?

Robert W. Ginnane:

A connecting line, and secondly that even if it was connecting line there was not assuring a sufficient similarity of transportation conditions to warrant rate equality.

The three-judge court unanimously sustained the Commission’s finding that Western Pacific was not a connecting line and thereby, therefore, found it unnecessary to get into the second question.

Byron R. White:

Well you are urging that (Inaudible)

Robert W. Ginnane:

It’s not being litigated before this Court.

Byron R. White:

So you don’t say that — you don’t argue that therefore the case be (Inaudible)

Robert W. Ginnane:

No indeed, because their 3 (4) argument is an entirely separate prong and an entirely separate ground for the relief which they sought.

(Inaudible)

Robert W. Ginnane:

Under 15 (3) and 1 (4)?

In effect the Commission held to that the adequacy of existing routes, through routes, coupled with problems of security over some of the routes sought by Western Pacific by Northern Pacific and Union Pacific, added up to an insufficient showing of public interest.

The Commission and the court below held that Western Pacific is not a connecting line at Portland because a connecting line within a meaning of Section 3 (4) is one which has either a direct physical connection at the common interchange point or as one which makes up a through route through the interchange point.

Robert W. Ginnane:

Admittedly, Western Pacific whose northern terminus at Bieber is 490 miles, railroad miles from Portland, does not physically, does not have a physical connection with Northern Pacific and Union Pacific in Portland.

Commission further held that no effective through routes exist between points in California served by Western Pacific on its connections and points the Northwest on then lines of UP and Northern Pacific through Bieber and Portland.

And in finding that no such through routes existed, the Commission applied this Court’s definition of through route laid down in Thompson v. United States.

That definition is that a through route, said this Court, is an arrangement express or implied between connecting railroad for the continuous carriage of goods from the originating point on the line of one carrier to the destination on the line of another.

And it’s admitted in this case that Western Pacific under the Thompson definition does not make up a through route with Northern Pacific and Union Pacific via Bieber in Portland.

Its definition is, its contention is that it is an intermediate segment of a route, the so-called Bieber route, involving Santa Fe, Western Pacific and Great Northern from points in California to Portland and that the route is a connecting line within a meaning of Section 3 (4).

The heart of their position is stated at page 19 of their brief, and they say there, and I quote.

“By connecing line, Congress apparently intended to describe a continuous series of lines where the traffic on one could physically moved onto the tracks of the others.”

This is the first time, this contention, this definition of connecting line has been urged since 1887.

And indeed, it took Western Pacific 30 years since the construction of the Bieber route to discover that all this time, it had been the victim of connecting line discrimination.

A few other undisputed facts, Western Pacific is a wholly separate railroad corporation from Great Northern and from Santa Fe.

It’s separately managed and separately prosperous, we’re not dealing with financially cripple line here.

All of this people are making money.

Western Pacific maintains through routes to Santa Fe and Great Northern, on track at moving between points in California and Portland and beyond Portland to points served by Great Northern, such points as Seattle, Spokane, Tacoma.

Looking at the language of Section 3 (4), it prohibits a railroad from practicing rate discrimination between connecting lines and it does have a definition of connecting line.

It says as huge in this paragraph the term connecting line, means the connecting line of any carrier subject to provision of this part or any common carrier by water.

It is the connecting line of a carrier, which is used in the singular not a string of carriers that can form a potential route.

It’s the connecting line of a carrier, the connecting line of a water carrier.

Now, we point out in our briefs that all through the Interstate Commerce Act, Congress has used the word “route”.

The Act has been amended again and again while Congress has used the word, route.

And the persistent used of the word, “retention”, or the concept of connecting line in Section 3 (4) we thing suggest that if Congress had wanted to protect a route and the appellant’s sense of the term, it would have known how to do so at many times since 1887.

Abe Fortas:

Mr. Ginnane, I hope I’m not interrupting your line of argument.

Robert W. Ginnane:

Not at all sir.

Abe Fortas:

Then if I understand you, you would say that this Court’s definition in Thompson as you referred to it.

We need to — an answer different than that given to me by counsel who spoke just before you did in this situation.

Let’s suppose that Great Northern had been the applicant here.

And that Great Northern asked for through rates from all the way down south here and not merely to the end of the Great Northern line.

Now, do I understand you to say that that would not — that the ICC would not construe connecting line to include that kind of a situation?

Robert W. Ginnane:

Let us assume in this litigation that Great Northern is a connecting line with UP and Northern Pacific at Portland.

Abe Fortas:

Yes.

Robert W. Ginnane:

And that therefore, if they filed for relief under Section 3 (4) and could show similarity of circumstances that they would be entitled to equality of rate treatment.

Now, I understood Mr. Bender to state that that of rate treatment to which Great Northern would be entitled as a connecting line, would not be limited to traffic moving to local points.

Abe Fortas:

And would not be limited to the Great Northern line that would go through the whole Bieber route for example.

Robert W. Ginnane:

Well, certainly in beyond the Great Northern lines because it would be entitled to equal rate treatment not merely on local traffic but on through traffic which would mean it would have to be able to carry it through, deliver it to Western Pacific at Beiber so that it brought down either Stockton for interchange or all the way down.

Abe Fortas:

Right and you agree with that?

Robert W. Ginnane:

I would agree.

A connecting line is entitled to rate equality not merely on traffic local to its lines but on through traffic passing over its lines.

Abe Fortas:

Well then I don’t — I’m sorry but I do not get the logic of your position because it seems to me that what you now said in the gaits of this case in the statutory construction here turn upon who’s the applicant.

Robert W. Ginnane:

I think that’s true at many situations.

Abe Fortas:

Sir?

Robert W. Ginnane:

I think that’s true of many situations in the law.

Abe Fortas:

So that —

Robert W. Ginnane:

And that would only someone whose rights have been protected by Congress —

Abe Fortas:

I see.

Robert W. Ginnane:

— can invoke that protection.

Abe Fortas:

So that the connecting line when the statute uses connecting line, the ICC’s position is that that term has meaning and importance here for purposes of determining standing and not for purposes of determining the result, am I right or wrong?

Robert W. Ginnane:

I think that’s — well that would be one way of putting it but I don’t think that exhaust the implications.

Byron R. White:

(Inaudible)

Robert W. Ginnane:

Well, of course Section 1 (4) applies regardless whether you have connecting lines or not.

Commission proceeding to enforce 1 (4) under Section 15 (3) could order participation in the through route and then the joint rate by six carriers as scattered all across the United States.

Byron R. White:

(Inaudible)

Robert W. Ginnane:

I would say this; if every line which makes up one of a dozen carriers stretched across the country can assert connecting line status, there isn’t much left to be done under 15 (3) in establishing through routes and joint and joint rates required by the public interest.

Byron R. White:

(Inaudible)

Robert W. Ginnane:

In that situation, in that situation.

Hugo L. Black:

Does your argument announce then to the — saying to the Commission that this particular railroad simply doesn’t have standing to raise those questions, suppose it is not connected up there but that the other one between the Western Pacific and Portland should come in and ask for that relief Commission would have to grant it.

Robert W. Ginnane:

Because it was a connecting line.

Hugo L. Black:

It’s almost effect in the standing to raise, isn’t it?

Robert W. Ginnane:

It’s a question of geography, really, geographical location.

William O. Douglas:

Would you — in that connection would you turn to page 23 of the Solicitor General’s brief?

Where he attempts to put in diagrammatic form, the factual settings of the Atlantic case and this case, are those accurate?

William O. Douglas:

I haven’t had a chance to look at the record in the Atlantic case.

Robert W. Ginnane:

Yes, they’re schematically accurate.

We have no quarrel.

As a matter of fact, they’re accurate enough that I would like to come back to it in just a minute.

William O. Douglas:

Yes.

Robert W. Ginnane:

We urge that Section 3 (4) and its provisional rate discrimination between connecting lines should not be read in the vacuum.

It’s only one of the several sections in which Congress has defined the obligations of privately-owned and privately-managed railroads to engage in integrated transportation service.

1 (4) says that railroads shall establish a reasonable through routes and reasonable rates over those routes with other carriers.

Under Section 15 (3) the Commission can compel such action on the part of railroads, and under the statutory pattern, we think it’s clear that railroads are not required to enter into through routes and joint rates with every conceivable combination of carriers and junctions.

They must enter into a reasonable through route and rate arrangements required to serve the commerce of the country and they may not discriminate against connecting lines.

But, on its phase, 3 (4) is narrower than the carriers’ obligations and the Commission’s responsibilities under 15 (3) because it’s limited to lines, not to routes.

There is very little legislative history in what Congress intended by this connecting line provision.

I suppose partly because it appears for the first time in the Conference Committee Report laid in 1886.

There was only characterization of it by Senator Spooner, is the only any of us either side of this case has found.

And Senator Spooner said the principle embodied in it was long ago imposed on a qualified way upon the Union Pacific and Northern Pacific Companies.

We can only figure this out as a reference to the Pacific Railroad Acts which has this Court as recognized required Union Pacific and Central Pacific to be operated as a single line, and to avoid any form of discrimination against each other.

So and of course those two lines were intend to and did physically connect.

So, the only clue we have as to the urge in the connecting line provision, it’s not conclusive but it’s the only thing we have is an illusion to the situation of two railroads Union Pacific and Central Pacific which did in fact physically connect.

Now, under the definition of connecting line proffered of by the Department of Justice, New Haven or Boston and Maine is one of Your Honors indicated.

Either one can assert a reasonably direct line potential route via New York Central, Burlington and Rio Grande or Union Pacific, the tie-up to be in connection with the Western Pacific at Salt Lake City.

Now, just as Seattle shies away from the implications of that, that Boston and Maine can exert a compulsion to participate routes in it from coast to coast, merely as being an element and a potential route and still claim connecting lines fixed, so just to suggest as this qualification that all the intervening participants must be willing to participate, but it seems to me that that presents anomalies too.

If such a string of carriers is a route which Congress intended to protect as a connecting line, illogical is it to suggest that any participant along the route can cut off the connecting line rights of anybody behind it.

I would like to turn to discuss briefly this Court’s decision relied upon by the appellants as dispositive, the Atlantic Coastline decision decided by this Court in 1932.

Your Honors will recall, the Commission held at Western Pacific was not a connecting line with the Northern Pacific and Union Pacific at Portland, because it didn’t have a direct physical connection with them, and secondly, because it did not participate with Northern Pacific and Union Pacific in through routes via and through Portland as defined by this Court in the Thompson case.

Both Western Pacific and the Department now contend that Western Pacific enjoys connecting lines status with Northern Pacific and Union Pacific at Portland, because they participate, because Western Pacific and Great Northern participate in a through route up to Portland.

They said that’s enough to make them a connecting line.

And they say that this flows from this Court’s decision in the Atlantic Coastline case.

To begin with, the Atlantic Coastline case didn’t involve Section 3 (4) at all.

It involved the interpretation and application of conditions which the Commission imposed in authorizing Atlantic Coastline and Louisville, Nashville to lease the Clinchfield line.

And they threw in a condition the protected condition requiring that the Clinchfield be kept open equally available to such carriers now connecting or which may hereafter connect.

Robert W. Ginnane:

And through traffic they desire to participate in through traffic between the Ohio River and points north and southeastern territory.

And after approval of the lease, coastlines sought to cancel a lot of joint rates and which paid Piedmont and Georgia & Florida, two small carriers had been participating.

And the Commission required them to continue these rates.

Now, as this act — had been sustaining this action of the Commission that this Court stated, the argument is that the Georgia & Florida does not connect since its own rails do not physically abut on the Clinchfield rails, the connection being made over the Piedmont and northern.

There is no warrant from limiting, said this Court, the meeting of connecting lines to those having a direct physical connection with Clinchfied.

The term is commonly used a referring to all the lines making up a through route.

The appellants, the Department say, that this language supports the proposition that connecting line includes all carriers who are willing to participate in through transportation.

They need not already have participated with the defendants in this case Northern Pacific and UP and Portland.

Their reliance on this Court’s Atlantic Coastline decision is wholly fallacious for two reasons.

As the three-judge court and the Atlantic Coastline case recognized the joint rates which the Commission ordered continued involved the participation of the two complaining carriers Georgia & Florida and Piedmont in through routes going way beyond the interchange points to points up in the Ohio and north of the Ohio River.

They were not routes up to the interchange point.

Secondly, looking — treating Atlantic Coastline as a Section 3 (4) four case, at every stage in the Atlantic Coastline litigation before the Commission and the courts, among the complainants was Piedmont which was the directing connect — the direct physically connecting line in the position of Great Northern in this case.

Piedmont as a connecting line would be entitled to nondiscriminatory rate treatment on through traffic as well as local traffic.

And as both the United States and the Commission pointed out in the Atlantic Coastline case in their joint brief, the fact that Piedmont was a connection and was entitled to nondiscriminatory treatment on through traffic, that that pretty much carried Georgia & Florida in this case Western Pacific along for free, that nothing in the facts before this Court in Atlantic Coastline, is inconsistent with the way the Commission applied this Court’s later definition of through route from the Thompson case.

And nothing and what this Court actually decided, supports the definition of a connecting line which they now uniquely and in the first time in 75 years urge.

Abe Fortas:

Mr. Ginnane, could I ask you whether the Bieber route constitutes, in your opinion, a through route as that word is used in Atlantic Coastline case.

Is it a through route?

Or does that phrase have some historic meaning that I don’t understand?

Robert W. Ginnane:

A through route does not exist as such.

Through routes exist between particular carriers.

In other words, we could not say that there exist a through route via Bieber between Los Angeles and Portland.

We would have to say in whole historic terminology is that there is a through route participated in by Santa Fe, Western Pacific and Great Northern between the Los Angeles and Portland.

And that through route unlike a public road that through route is not available to nonparticipating carriers such as Northern Pacific and Union Pacific.

Abe Fortas:

Well, what you’re telling is that that is a through route there is a through route let’s say from Los Angeles to Portland or whatever via those three carriers.

Robert W. Ginnane:

There is indeed and some active through route as a matter of fact Western Pacific is about 1/3 of its tonage —

Abe Fortas:

And you don’t either, and that is the phrase that is used in Atlantic Coastlines, as I said, on page 293, and then Atlantic Coastline, as Justice Brandeis said the term “connecting lines” is commonly used as referring to all the lines making up a through route.

Robert W. Ginnane:

And in that case the through route broke over the interchange point, there weren’t up to the interchange point.

Thank you.

Frank S. Farrell:

May it please the Court, I represent the railroad appellees in this case.

In response to Justice Harlan’s question, I’d like to point out the record of this case during the oral argument before the Commission, counsel for appellants was asked if there were through routes in existence in this case and he said I quote, “I don’t think there are any through routes in existence today” and that’s found in the record at 509.

(Inaudible)

Frank S. Farrell:

I think that is correct, Justice.

(Inaudible)

Frank S. Farrell:

That is these carriers have join to get a name at the Santa Fe, Western Pacifica and Great Northern, and holding themselves within the Thompson case to publish single factor through routes.

(Inaudible)

Frank S. Farrell:

In these particular circumstances, that would be correct.

Here is there is no finding by the Commission and no evidence submitted as to whether or not the Great Northern was in fact a connecting line.

The Great Northern in its pleading before the Commission said we have no objection, it did not participate, it did not offer any evidence.

William J. Brennan, Jr.:

I thought it had (Inaudible)

Frank S. Farrell:

Well there is no finding on that; it does serve Portland Justice Brennan.

It does serve Portland serve industries at Portland.

Byron R. White:

But the (Inaudible)

Frank S. Farrell:

We are not, Justice White.

We think that’s irrelevant out of the circumstances of this particular case.

William J. Brennan, Jr.:

I know but that’s exactly my point.

If I understand Mr. Ginnane where he has said that if any of these carriers are moved (Inaudible) understanding under 3 (4) it’s only Great Northern.

Frank S. Farrell:

That is his answer, as I understand it, yes sir.

William J. Brennan, Jr.:

Is that true?

Frank S. Farrell:

That is correct, that is correct.

Now, there is today vigorous competition between points in California and points in the Pacific Northwest, contrary to what counsel for the Department of Justice stated, a shipper at Los Angeles has a choice of routes, it has choice of rates.

It can route a shipment Southern Pacific on north to Portland and fence connecting lines beyond.

It can route at Santa Fe and fence Southern Pacific or Santa Fe, Western Pacific.

It can also route at Union Pacific, it has a through route.

Hugo L. Black:

Well, if it routes it by Western Pacific, is the rate higher of lower?

Frank S. Farrell:

If it’s Western Pacific in conjunction with the Great Northern, the rate would be the same.

In other words, when the Commission in 1931 authorized the extension of the Great Northern Railroad south to Bieber, in the extension of the Western Pacific north to Bieber pursuant to Section 1 of the Act, those routes represent that they would join together and publish single factor joint to rates between these points and they have since that day.

And they seek traffic to move over that route in competition with the traffic moving over the other routes.

Hugo L. Black:

I must have misunderstood you or one of the others.

Do I understand that the shipper in Los Angeles wishes to ship through the route that goes on with Portland and go over the Western Pacific, that he can now get his cheaper rate if you would get if he takes the through rate on Los Angeles to Boston?

Frank S. Farrell:

That is correct, Mr. Justice Black, unless he sought the route that shipment.

Frank S. Farrell:

The only exception for that question would be if he sought to route that shipment by Santa Fe, Western Pacific, Great Northern and fence Union Pacific or Northern Pacific the odd.

Then a combination rate with one and that would be part of it, but if he routed it via the Western Pacific and Great Northern be on, it would be the same other words he has the choice of going either way.

Hugo L. Black:

If he has to pay an extra way, if he ship by the Western Pacific.

Frank S. Farrell:

No, he could still ship by the Western Pacific.

Hugo L. Black:

I mean all the way from Los — I’m still lost here, shipment is going to go from Los Angeles to Portland, do I understand you to say now that under — although there is no through rate by the Western Pacific, that the man can still ship it as cheaper that way as he can over the one where they have through route?

Frank S. Farrell:

There is a through — there is a single factor joint through rate that shipment could move Santa Fe to stop and fence Western Pacific to Bieber and Great Northern to Portland.

If that rate would be the same, Pacific move Santa Fe, Southern Pacific to Portland or south the pacific all the way to Portland.

Now if he goes on up, if he goes on up by the Bieber route in conjunction with the Great Northern I would be the same.

But if he sought the Bieber route in conjunction with the Union Pacific or the Northern Pacific north of Portland, they publish a single factor and it’s a local rate and that rate would then be higher.

But if he was going to Seattle for example, he could go there either with the Great Northern, they serve Seattle in which case he could move via the so-called Bieber route on the same phase that he could go to Southern Pacific in Portland.

There is a multiplicity of routes available today.

William J. Brennan, Jr.:

Where is this cost less?

Frank S. Farrell:

It cost more because if a shipper seeking to used the Western Pacific and the Great Northern to Portland —

William J. Brennan, Jr.:

Suppose he wanted to go to Seattle?

Frank S. Farrell:

— seeks to go to just a point served —

William J. Brennan, Jr.:

Suppose he wanted to go to Seattle?

Frank S. Farrell:

Alright, he can go to Seattle by the Great Northern he gets the same rate, but if he sought to go Bieber route in Northern Pacific, he would pay a higher rate than he would if he went Southern Pacific, Northern Pacific.

In short, the Union Pacific and Northern Pacific he had not joined with the Western Pacific in a publication what we call “single factor joint through rates”.

In short, there is not been a holding out within the meeting of the Thompson case, there never has been.

Now, Western Pacific sought before the Commission, contended that there were not reasonable through routes today.

It introduced testimony.

The Commission found that there were reasonable through routes that there, in fact, were a multiplicity of routes available today.

And that these defendants had complied with their duty under Section 1 paragraph (4) which specifically provides and applies to routes.

Then on the appeal the Western Pacific brought that contention.

It does not challenge it, does not challenge the finding that these defendants —

Byron R. White:

(Inaudible)

Frank S. Farrell:

Well, the question then would still remain.

Byron R. White:

(Inaudible)

Frank S. Farrell:

Well, even if the Great Northern where the complaint, the question would still the raised whether or not they were connecting but let’s assume that for the moment.

They have to establish a similarity of circumstances and conditions in order to provoke the — invoke the provisions of Section 3 (4).

Byron R. White:

I agree with that and then what’s more (Inaudible)

Frank S. Farrell:

Yes, although they could also invoke 1 (4), 1 (4) would only —

Byron R. White:

There wouldn’t be any — the Commission wouldn’t have to take any (Inaudible)

Frank S. Farrell:

That’s correct, that’s correct.

That’s correct, Mr. Justice White.

That is correct.

But then when we reach the part and the Commission had found that there are adequate through routes, the Western Pacific now says, “Well, we contend that the connecting line is any route which has physically available service and we seek the challenge the Commission’s order on that basis.”

In short, they say that the term, the statutory term, which is remained unchanged since 1887 for 78 years should be construed to me any line.

The Department of Justice unable to embrace that contention submits that well it must be part of a route and secondly, the participants in that route must be willing to voluntarily cooperate.

When one turns to see what a route means, says the Department of Justice here uses in their briefs, one would think that the Thompson case, which this Court decided in 1952, would apply.

But they say no.

The Thompson case does not apply into this purpose, and does sure led to speculate as to what a route is.

They further say that it must be voluntarily.

In other words, under their definition if the Great Northern were not willing to participate, then under justice definition the Western Pacific is not a connecting line.

So Monday, if they’re willing Great Northern is willing to participate they are connecting line, Tuesday if they are not, they are not connecting line.

And I say that’s such a delusive test that it could not possibly be applied.

Hugo L. Black:

May I ask you?

What would be the situation if the Atchison, Topeka and Santa Fe which connects at Los Angeles had filed this petition, would it be in the same — could be in the position to raise it?It connects at Los Angeles.

Frank S. Farrell:

That is correct.

Hugo L. Black:

And it could raise it?

Frank S. Farrell:

It could raise it under 1 (4) of the Act, a request for through routes containing the public interest support such a request but they are positioned.

Hugo L. Black:

And the Great Northern which connects at Portland could raise it.

But your position is as I understand it that the Western Pacific is the one in the line that couldn’t.

Frank S. Farrell:

No, the Santa Fe could not raise the contention either under Section 3 paragraph (4).

Because it lacks a physical connection, it also is not a participant in through routes.

Hugo L. Black:

It’s not yet but supposed it wanted to be.

Frank S. Farrell:

It still could not raise it under paragraph (4) Section 3.

It could however raise it under paragraph (4) of Section 1 which is the provision of the Act designed to establish reasonable through routes.

Hugo L. Black:

As I see if this other route would be performed which is the through route they want, if pertaining that couldn’t this map on page 5 of the Government’s brief, if it confides transportation by the Great Northern or the Western Pacific and by the Atchison, Topeka and Santa Fe, that’s right isn’t it?

Frank S. Farrell:

That’s correct.

Hugo L. Black:

And the Atchison, Topeka and Santa Fe, the Great Northern are connecting railroad are connecting line.

Frank S. Farrell:

The Santa Fe is not, Your Honor.

Hugo L. Black:

It is not?

Frank S. Farrell:

Only the Great Northern, because it has the physical connection at Portland.

But the Western Pacific does not or those in Santa Fe, the Santa Fe Your Honor does not run north to Stockton.

Hugo L. Black:

Well this shows that, this map must be wrong.

Frank S. Farrell:

That’s Los Angeles to Stockton, Your Honor.

Hugo L. Black:

Yes.

Frank S. Farrell:

I think the diagram is schematically correct.

William O. Douglas:

You say that the Western Pacific remedy is under 1 (4).

Frank S. Farrell:

1 (4) of the Act, yes Mr. Justice Douglas.

William O. Douglas:

Is there any application ever been made?

Frank S. Farrell:

Yes, in this — to the Commission.

William O. Douglas:

Under 1 (4).

Frank S. Farrell:

They predicated under 1 (4) and under 3 (4).

They contended they were not reasonable through routes that we have breeched our duty.

William O. Douglas:

What did the Commission say about 1 (4)?

Frank S. Farrell:

The Commission would have examined the multiplicity of routes and found that to be adequate through routes to serve the needs of commerce and defense in this area of country.

And held their to be no need for the establishment of any additional through routes, and that day went on to treat their further contention with respect to their status as connecting line and the alleged discriminatory treatment.

I remind the Court that the test prescribed by the Commission, namely a physical connection or present participation in existing through routes is the exact test that’s understood by anyone dealing with this Act.

This is a basic provision here.

The Western Pacific has now changed its position again, it contends now it’s adopted the definition as a three-pronged definition.

It says, one, the line must be part of a route.

It’s says, two, it must be directly competitive, it says three, all participants must be willing to engage in the transportation.

So its test now is narrower test than the Department of Justice has advocated.

Prior there are two parts of today’s arguments and based on the brief it was a far broader test.

The term —

Earl Warren:

I understood both you and Mr. Ginnane to say that this is the first time this principle has ever been raised in — before the Commission or in courts since 1887.

Then I ask you if there has been any practice of doing what the Western Pacific that contends throughout the country irrespective of litigation.

Frank S. Farrell:

Not to my knowledge, Your Honor.

Frank S. Farrell:

In the vice of this, let us assume that say the Northern Pacific that serves Seattle on the west and the twin cities in Minnesota, Minneapolis-St. Paul, Minnesota and in the northwestern which extends from the twin cities to Chicago.

Say those routes aside for competitive considerations, they have a direct service route and they are going to reduce their rate, to me let us say intermodal competition, competitions in truck lines.

And now a carrier down here way done the southwestern part of the country says, “Well goodness sakes we’re the connecting line, we demand to be included in that rate, and if you don’t we’re going to file a complaint against you.”

Well, immediately the question presented is whether or not this rate is convinced over this long circuitous route.

And so these lines then who ought to reduce their rate to participate and serve the needs of commerce are going to be – are going to have to refrain and may restrain from doing it.

Abe Fortas:

The mere fact that we find that a line is a connecting line does not mean that it’s entirely to relieve from the freight line.

Frank S. Farrell:

No, you’d still have to establish similarities in circumstances condition, Mr. Justice Fortas.

Abe Fortas:

Well, in not — that is not so, that is to say that the ICC still can make a rational and sensible judgment based on the standards in the Act.

Frank S. Farrell:

That is correct, that is correct.

They would still examine it but you’d have a multiplicity of litigation.

And there would be no concern as to whether or not there are — there is a public need for these through routes.

I would like to take just the remaining minute or two to explain to you why the Northern Pacific and Union Pacific for 35 years have refused this.

Under the existing rates the shipment would come north on the Great Northern to Wishram shown here on the map and would then move directly east to Spokane.

Assuming it’s moving east out the Cascade Mountains, under what is thought by the appellants that shipment would come to Wishram then go west to Vancouver, Washington, fence down into Portland which point would be interchanged to the Union Pacific or Northern Pacific and then on to its destination.

Security back home of in excess 200 miles in through there, by in transit our service would be a day slower in eastern Washington than would be the service of the — than would be our existing service at the present time.

It would be two days slower than the existing service of the Great Northern.

Our routes, both of them serve Oregon, 246 miles to Portland but their contention is we should not get this traffic until it gets to Portland.

More than that, the traffic from Bieber on north would be handled by a line that competes, if these destinations in these points both with the Union Pacific and Northern Pacific.

These way bills would be available to them and they could say, “Well now why should you use Union Pacific, or why should you use Northern Pacific service form Portland?

Why goodness sakes, you routed via us we’ll need two days faster.

We don’t have to go this roundabout route down at the Portland we go directly down to Wishram and then south so our service is far better.”

And so not only would we lose traffic moving north and south but shippers will say, “Well if that’s typical of the service being offered by Northern Pacific or Union Pacific may be we ought to get somebody else to handle our traffic to other points.

And we ask you then, we say the — when the Commission has full power to establish whatever reasonable routes are required and when they have specifically found that additional routes are not required here which remains unchallenged, we ask the Court not to take the term “connecting line” and read the adjective connecting out of it and to make it so inclusive that will embrace any road of the country to provide them with relief when full relief could be accorded assuming there was any public need for it.

And we think the statutory history and we think the cases fully support the established construction of the Act.

Thank you very much.

Earl Warren:

To counsel’s argument that since 1887 this principle has never been raised before the Commission or in court and that there is no practice between railroads of having through rates such as you insist upon here.

Walter G. Treanor:

Addressing myself Mr. Chief Justice to the second part of the question.

First, I like to say that I take a position directly contrary to what they say and say that is to say that it is the standard practice in the railroad industry to encourage as many outlets as possible for your traffic.

And if you connect with more than one carrier that your own interest and the practice in the industry ever since I’ve been associated with the industry has been, that railroads do not discourage additional outlets to their traffic.

And I think that while it is true that there are very few cases which have hit this issue directly, I think Atlantic Coastline hits the issue directly and I think that Chicago, Indianapolis and Louisville which involves Section 3 (4), although it involved that interchange facility Section of 3 (4) did deal with the question of connecting lines status and did hit head on the two question which we have here whether you need a physical connection and secondly whether you need in lieu thereof the prior existence of through service.

Walter G. Treanor:

And Mr. Justice Brandeis, in his opinion, hit both those issues squarely in Chicago, Indianapolis and Louisville.

But I do agree that while there have been very few cases on this subject, I think that the explanation is not what they have suggested to you but really because the industry itself simply does not tie its hand in a number of connection and equal treatment which its connections.

Earl Warren:

Well would you just say it’s common practice in the railroad industry to and has been through the years to do what you are urging here to be done?

Walter G. Treanor:

Yes, Mr. Chief Justice that —

Earl Warren:

I have no knowledge on what would be done.

Walter G. Treanor:

— that this is our position and we think the fact that there has been no litigation on it suggest one of two things.

It means either that no one has other than the Western Pacific has been confronted with this type of tactic, and secondly it suggests that other railroad are finding their traffic moving freely over their connecting lines.

Byron R. White:

Why is it the — why would you suggest the Great Northern was not — did not impressively support you in the hearing or why wasn’t it the complaint?

Walter G. Treanor:

I respectfully suggest, Mr. Justice White, that I believe the reason is that the Great Northern is presently and at that time was actively engage in a merger with the Northern Pacific.

They are presently litigating that matter before the Commission and they are trying to form a single company and I think they thought it would be inconsistent for the Great Northern on the one hand to be attempting to merge with the Northern Pacific, and in the other hand become a party to this proceeding.

Another point I would like to raise.

Mr. Justice Fortas raised a question about the practical implications I think much of —

William J. Brennan, Jr.:

Tell me, Mr. Treanor, Northern, now let’s see, Great Northern has the physical connection with Western Pacific?

Walter G. Treanor:

Yes Mr. Justice Brennan.

William J. Brennan, Jr.:

And as this merger goes through your problem is solved, isn’t it?

Walter G. Treanor:

No sir, it is not, for two reasons.

First of all it does not solve our problem with the Union Pacific and secondly —

William J. Brennan, Jr.:

Well it has, you don’t have a physical connection.

Walter G. Treanor:

But we have a physical connection but not at the common gateway, we lose our standing to bring a complaint on the discrimination statute because the connection is down here and their connection was a Southern Pacific is up at Portland and over several other places.

So we don’t have any opportunity to bring an action under Section 3.

And I’d like to point out that we do not believe that there’s any possibility at all any real possibility of extended litigation arising from this situation because, I ask the Union Pacific man on the record at the oral hearing before the Commission whether he could give me a single instance were they treated their common connections differently and he could not come up with a single one.

Now, the Union Pacific as a tremendous system and has interchange with many, many carriers at thousands of points, and they could not point to a single incident where they treated anybody differently.

We’re the only ones that they do and it’s only in this situation here.

I would like to address one point to a question raise by Mr. Justice White with regards to Section 1 (4).

Section 15 (4) the Act set forth the factors which must be considered in setting up any through routes under Section 1 (4) and it specifically says by its very terms that it has no application in a Section 3 case.

Now, in this particular case, the reason that Section 1 (4) is not the answer here is that Section 3 (4) is designed by Congress to meet an entirely different evil.

Section 1 (4) can be prescribed in a relief invoked where you don’t treat common connections differently.

Where you treat common connections differently than it is required that you must abate that.Now whether that results in giving the —

Byron R. White:

(Inaudible)

Walter G. Treanor:

I can’t answer that I believe Mr. Justice White, the term “through route” is not a part of Section 3 (4) it does not appear and therefore you do not have to have a through route situation before they can be audit to treat their common connections equally.

Walter G. Treanor:

They can either change their level of rates with the Southern Pacific or they can give us the same rates that they are giving Southern Pacific.

This Court said and it was in — cited in our brief United States versus Pennsylvania.

(Inaudible)

Walter G. Treanor:

Yes sir, in Section 1 (4), if you refuse and fail to hold yourself out, Section 1 (4) can be brought into play as a remedial statue.

If you have through routes with one common connection and you fail to give them with another connection, you can be required on the Section (3), (4) to equalize them.

Byron R. White:

(Inaudible)

Walter G. Treanor:

Excuse me sir.

I did not mean to say that, what I meant to say was if you give it as a relief —

Byron R. White:

(Inaudible)

Walter G. Treanor:

That same argument was raised in Chicago, Indianapolis and Louisville.

It was met head on by this Court, and they said that it is —

(Inaudible)

Walter G. Treanor:

No sir, it is not my position.

My position is that under Section 3 (4) really, they have their options as to how they will correct the inequality and the unequal treatment.

They are not obligated to establish through routes with us in order to equalize that.

That’s up to them how they handle that situation.

I do concede the result might be same under other sections of the Act under other complaints which might be brought by shippers depending on the tact that they took.

I see my time is up.

I thank you, Your Honors.

Earl Warren:

(Inaudible) could furnish us with short memorandum as to how in practice this principle that you urge here has been used throughout the railroad industry in the country.

Did I make myself —

Robert W. Ginnane:

May I ask some clarification.

Earl Warren:

Yes.

Robert W. Ginnane:

Is there a proper definition of connecting line?

Earl Warren:

No, I mean this.

As I understood you Mr. Ginnane, this is the first time that this issue has ever been raised before the Commission or in court.

Robert W. Ginnane:

Only that — I only meant to say the first time such a concept of connecting line.

Earl Warren:

Yes, well I’m relating it to this situation here and what I like to know is just how that has been handled in practice in as much as there is no law on the subject, no cases, no issues brought before the courts on this precise issue.

If that’s practical, do it with his employ, no need worry about it.

We’ll adjourn.