Before LUMBARD, Chief Judge, SMITH and HAYS, Circuit Judges.
HAYS, Circuit Judge : Petitioner, Trans World Airlines, Inc., seeks review in this court under Section 1006 of the Federal Aviation Act*fn1 of an order of the respondent Civil Aeronautics Board.*fn2 The Board's order resulted from a motion by Hughes Tool Company requesting either a disclaimer of jurisdiction or approval under Section 408 of the Act*fn3 as to the acquisition by Toolco of Sinking Fund Notes of TWA in the principal amount of $92,800,000 from the Metropolitan Life Insurance Co. and The Equitable Life Assurance Society of the United States. TWA intervened before the Board opposing the relief requested by Toolco on various grounds.The Board's order, which was issued without holding a hearing, "declared" that Toolco was free to acquire the TWA notes on condition that Toolco divest itself of control over Northeast Airlines, Inc. TWA requests that this court vacate and set aside the order, direct the Board "to take no further action" on Toolco's motion "until after determination of the related issues between TWA and Toolco now sub judice," and to afford a hearing at that time to TWA and others on the Toolco motion. Respondent CAB requests that its order be affirmed or the petition for review dismissed and Toolco, which has obtained leave to intervene, requests similar relief.
I. The Factual Background
A. Previous Orders of the Board
Beginning about 1939 Howard Hughes bought TWA common stock through Toolco, his wholly owned and controlled corporation, until by 1942 Toolco owned 440,050 shares, 45.6 percent of the total outstanding shares. On application of Toolco in 1944 the CAB held a Section 408 hearing and determined that Toolco had acquired control of TWA through its 45.6 percent ownership interest.*fn4 CAB approved this "acquisition of control" because it believed Toolco's operations and plans would not be adverse to the public interest "in view of what might be referred to as the paternalistic attitude which Hughes Tool has exhibited up to the present time."*fn5 To guard against the possibilities of abuse of Toolco's control of TWA by reason of Toolco's aircraft activities, the CAB imposed conditions on its approval, requiring TWA and Toolco to limit individual transactions between them to items less than $200 in value and total annual transactions between them to $10,000.*fn6
In 1947 the Board ordered an investigation to determine whether any "agreement or any arrangement or action related thereto, or any change in the activities of Toolco in the field of aeronautics since the 1944 order . . . has resulted or will result in an acquisition of control of TWA" requiring approval under Section 408, and "whether such acquisition of control, if any, is consistent with the public interest and fulfills the conditions of said section 408 . . ."*fn7 The Board found after investigation and hearing that there was an agreement between Toolco and TWA which gave Toolco the "right to acquire up to a possible 80 percent of the stock in TWA."*fn8 The Board held "that there can be more than one acquisition of control of an air carrier, as a matter of law . . .,"*fn9 and "that the term 'control' is not an absolute or unqualified concept, but rather one which may import various meanings and apply to and cover a variety of situations."*fn10
The Board determined on these principles that Section 408 approval was required despite prior approval in 1944 because "a controlling person owning a substantial portion of the controlled carrier's stock may have acquired in 1944 an actual or de facto control but not the full and complete legal control which flows from ownership of all, or substantially all, of the issued and outstanding stock of the carrier."*fn11 The Board ordered a Section 408 hearing to approve or disapprove the "further acquisition of control."*fn12
After a hearing the Hearing Examiner found the "further acquisition of control" of TWA by Toolco to require "a rather broad inquiry into the relationships between the controlling and the controlled companies,"*fn13 and therefore he extensively reviewed the activities of TWA, Toolco, and Hughes since 1944.He found "no conflict of interest between Toolco's present or contemplated aeronautical activities and its control of an air carrier."*fn14 He held that Toolco and Hughes had contributed "to the welfare and well-being of TWA" by their "efforts at maintaining or improving the carrier's financial position following the war,"*fn15 and "that the additional control acquired by Toolco . . . is consistent with the public interest."*fn16 The CAB adopted the findings and conclusions of the Examiner and approved the acquisition of further control subject to the same conditions imposed in 1944.*fn17
In 1960 TWA requested Board approval of a plan for financing the purchase of jet aircraft. The plan provided for the issuance to Metropolitan Life Insurance Co. and Equitable Life Assurance Society of $92,800,000 principal amount of 6 1/2% Equipment Mortgage Sinking Fund Notes of TWA, due December 31, 1972. The TWA stock held by Toolco was placed in a voting trust which was to last until December 15, 1970, unless first terminated or extended as provided in the agreement.
Toolco appointed one of three trustees. The other two, however, were appointed by the notes agent, the Irving Trust Co., and the voting rights in Toolco's TWA stock were to be exercised by majority vote of the three trustees. Under the Option Agreement Toolco had the nontransferable right to purchase outstanding TWA Sinking Fund Notes by payment of the notes in full plus a premium of twenty-two percent until March 31, 1962, when the amount of premium was to be thereafter reduced by one-half percent for each elapsed quarter year.*fn18 On exercising this option Toolco could terminate the voting trust.
Under the Option Agreement Toolco was required to provide satisfactory opinion of counsel stating that all necessary governmental approval had been obtained before it could purchase the notes from the insurance companies and terminate the voting trust.*fn19
The Board considered that under this plan "a significant and fundamental change will have been accomplished in the control of TWA by Toolco." The Board stated: "Upon the execution of the voting Trust, the Toolco control of TWA will change drastically in both form and substance."*fn20
Believing that "to facilitate TWA's acquisition of jet equipment is in the public interest" and that doubts about the "jurisdiction" of the Board to act should be set aside when its competence to act under Section 408(a) was uncontested, the Board approved the plan, but also stated it anticipated a Section 408(b) ...