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West India Fruit & Steamship Co. v. Seatrain Lines Inc.

UNITED STATES COURT OF APPEALS, SECOND CIRCUIT


November 5, 1948

WEST INDIA FRUIT & STEAMSHIP CO., INC., ET AL.
v.
SEATRAIN LINES, INC.

Author: Frank

Before AUGUSTUS N. HAND, CLARK, and FRANK, Circuit Judges .

FRANK, Circuit Judge .

1. Defendant, Seatrain, contends that the district court lacked power to issue an injunction in aid of the Commission, regardless of the facts. We cannot agree, especially as the Commission has intervened as a party plaintiff. See California v. United States, 320 U.S. 577, 584, 585, 64 S. Ct. 352, 88 L. Ed. 322; F.R.C.P. 24 (b) as recently amended; S.E.C. v. U.S. Realty & Improvement Co., 310 U.S. 434, 60 S. Ct. 1044, 84 L. Ed. 1293; Berger, Intervention by Public Agencies in Private Litigation in the Federal Courts, 50 Yale L.J. (1940) 65. We consider inapposite U.S. Navigation Co. v. Cunard, 284 U.S. 474, 52 S. Ct. 247, 76 L. Ed. 408. That decision imposed limitations on the power of the courts to interfere with the exercise of an administrative agency's powers. Here the court was asked to assist the Commission by preserving the status quo until it could determine whether it had statutory jurisdiction, and, if so, how it should act. Appellant relies on S.E.C. v. Long Island Lighting Co., 2 Cir., 148 F.2d 252. This court as at present constituted does not agree with that decision. Moreover, the Supreme Court by granting certiorari, accompanied by a stay*fn1, wiped out that decision's practical effects*fn2 In any event, the rationale of the Long Island case lacks pertinence here; for there the majority rested its conclusion on a holding that the S.E.C. unmistakably lacked any possible jurisdiction; on the facts now before us, we are unable so to hold as to the Commission here. On that basis, the district court had authority to issue an injunction.

2. In exercising his discretion, the trial judge was obliged, of course, to balance the harms the injunction might do to the respective parties. Having in mind the statutory provision for award of damages by the Commission, we cannot say that he decided erroneously.

Appellant emphasized a fact apparently not called to the attention of the district judge, i.e., the damage to appellant which would result if the Conference made contracts enduring for the calendar year 1949. Whether because of that fact, the issuance of the injunction should be deemed an abuse of discretion, we need not decide, in the light of the telegram quoted above. Considering that telegram, we remand with directions that the injunction be made conditional upon all members of the Conference joining in the offers contained in the telegram and in oral argument, and that they consent that the cancellation date be extended until December 1, 1948 or, if the Commission has not then entered its decision, until thirty days after such decision. The injunction should also be modified so that if any of the Conference steamship lines reduce their rates, Seatrain will be permitted to make a corresponding reduction. It goes without saying that we do not decide that defendant has violated the statute.

Modified and affirmed.


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