The opinion of the court was delivered by: BRYAN
Plaintiff is a common carrier by water certified by the Interstate Commerce Commission for transportation of commodities between the Port of New York and the Ports of New Orleans, Texas City and Savannah. It sues, pursuant to 28 U.S.C. § 1336, 1398, 2284 and 2321-2325, and 5 U.S.C.A. § 1009, to set aside two orders of the Commission dated August 14, 1958, made under Section 4, subdivision 1 of the Interstate Commerce Act (49 U.S.C.A. § 4(1), which authorized the intervening rail carrier defendants to charge lower rates for the transportation of certain iron and steel articles between eastern points of origin and southwest gulf ports than is charged to intermediate inland points. Plaintiff also seeks a direction that the Commission suspend the operation of tariffs filed by the rail carriers which embodied rates approved by its Fourth Section orders.
On August 15, 1958 the District Judge to whom this application was first made, after hearing plaintiff and the Commission, issued a temporary restraining order staying the operation of the Fourth Section orders and directing the Commission to suspend the filed tariffs based thereon pending further order of the court.
On June 9 and 13, 1958 the intervening rail carriers filed two applications with the Interstate Commerce Commission seeking relief from the long and short haul provisions of Section 4 with respect to rates for the carriage of iron and steel articles, carload minimum 60,000 lbs., from the eastern points of origin to southwest gulf ports. Concurrently they filed tariffs embodying the reduced rates which they sought to have approved by their Section 4 applications. These tariffs were scheduled to become effective on July 15, 1958.
On June 28, 1958 plaintiff petitioned the Commission for denial of the Fourth Section applications and for a suspension of the filed tariffs embodying the proposed lower rates. It specifically requested a hearing.
The rail carriers then postponed the effective date of their proposed filed tariffs from July 15, 1958 to August 15, 1958 and filed a reply to plaintiff's petition.
The matter was considered not by the Fourth Section Board of the Commission which normally passes on Fourth Section applications and which had denied a prior application made by the rail carriers for this same relief in February of 1958. Instead the matter was transferred to Division 2 of the Commission composed of three Commissioners, which, on August 14, 1958, by a divided vote, granted the Fourth Section applications and declined to suspend the filed tariffs. At 2 o'clock on the same day plaintiff filed a petition for reconsideration of these determinations by the entire Commission and sought to postpone the effective date of the tariffs for 30 days pending possible judicial review. This was denied by the full Commission two hours later, at 4 p.m. of the same afternoon, and the tariffs embodying the proposed rates became effective as scheduled at 12:01 a.m. on August 15, 1958.
The plaintiff filed the instant suit the next morning and the temporary restraining order was then issued.
Under Section 4(1) of the Interstate Commerce Act it is unlawful for carriers to charge greater compensation for a shorter than for a longer distance without express authorization from the Commission. Application for such authorization may be granted only 'after investigation' and 'in special cases', and the rates to be charged must be 'reasonably compensatory'.
Plaintiff contends that the Fourth Section orders are invalid because the Commission refused to hold a hearing on its petition for denial of the rail carriers' applications as plaintiff requested, and because the orders are not supported by the necessary findings and do not show sufficient basis for their issuance. Plaintiff also urges that since the tariffs filed by the rail carriers which became effective on August 15, 1958 were dependent upon the granting of the Fourth Section applications and were 'unlawful' unless such authorization was obtained, they necessarily must fall if the Fourth Section orders are vacated.
Defendants, on the other hand, maintain that plaintiff has no standing to challenge the Fourth Section orders, that they are not reviewable, that no hearing was required upon the Fourth Section applications, and that the orders are sufficiently supported by such findings as are necessary and are valid. They also maintain that the court was without authority to issue the temporary restraining order and particularly the provision of that order which directs the Commission to suspend the tariffs filed by the carriers which were to become effective on August 15. They urge that the temporary restraining order should be vacated forthwith.
We have concluded that the Fourth Section orders must be vacated and the matter remanded to the Commission.
1. The plaintiff has standing to challenge the Fourth Section orders in this action.
Plaintiff holds a certificate of convenience and necessity as a common carrier by water under Part III of the Interstate Commerce Act, 49 U.S.C.A. 901 et seq. It is engaged, inter alia, in transporting iron and steel products from the Port of New York to the Gulf Ports of New Orleans, Louisiana, and Texas City, Texas. Such products are transported by rail from the producers' plants to the plaintiff's dock in Edgewater, New Jersey, where the freight cars carrying them are loaded on to the plaintiff's ships. At the Gulf Ports the cars are unloaded and there is another short rail haul to destination. The advantages of plaintiff's type of service were recognized in United States v. Pennsylvania R. Co., 323 U.S. 612, 617, 65 S. Ct. 471, 89 L. Ed. 499.
Prior to the orders of which plaintiff complains its rail-water rates were less than the intervening rail carriers' all-rail rates. The new all-rail rates which became effective on August 15, 1958 are substantially less than plaintiff's rates and will, it is alleged, cause plaintiff irreparable damage.
As a certified water carrier plaintiff is entitled to protection under the declared policy of the Transportation Act of 1920, Ch. 91, 41 Stat. 456, and the Interstate Commerce Act, 49 U.S.C.A. 1 et seq. Its interests are directly and vitally affected by the Commission's orders. It was an adversary party to the proceedings before the Commission and fully and properly preserved its rights.
The plaintiff water carrier and the defendant rail carriers are competitors for the iron and steel traffic affected by the rates authorized by the Commission. The reduced long haul rates authorized will affect a substantial ...