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Overseas National Airways Inc. v. Civil Aeronautics Board

decided: May 25, 1970.


Kaufman and Feinberg, Circuit Judges, and Timbers, District Judge.*fn*

Author: Feinberg

FEINBERG, Circuit Judge:

Petitioner Overseas National Airways, Inc. ("ONA") and intervenors Saturn Airways, Inc. and Universal Airlines, Inc., collectively referred to as petitioners, seek review of two orders of the Civil Aeronautics Board, which refused to expand the scope of a proceeding before the Board. We hold that the orders are not final, and accordingly dismiss the petition for review.


Petitioners are all parties in the Transatlantic Supplemental Charter Authority Renewal Case, Docket 20569, which was instituted in December 1968 by the CAB, Order 68-12-93, in response to the applications of ONA, Saturn and four other supplemental, or charter, carriers.*fn1 The purpose of the proceeding as initially defined by the Board was to consider "the renewal of existing authority" held by the six applicants to provide transatlantic passenger charter transportation. In June 1969, by Order 69-6-25, the Board consolidated with Docket 20569 various other applications for transatlantic passenger charter authority submitted by carriers who do not now have such authority; Universal is one of these additional applicants.

What has prompted petitioners to seek review is the Board's refusal to expand the scope of the proceeding before it to include consideration of the related, but hitherto distinct, subject of transatlantic cargo charter authority. In its original Order 68-12-93, the Board refused to consider those aspects of petitioners' applications which sought transatlantic cargo charter authority, and dismissed that portion of the applications without prejudice. The Board's stated reason was "to limit the scope of this proceeding, thereby avoiding undue complication of the issues and delay." After petitions for reconsideration had been filed, the Board did expand the scope of the proceedings somewhat, as has already been noted, to include consideration of applicants for transatlantic passenger charter authority not previously granted such authority, and in various other ways not here relevant. However, the Board held fast in its determination not to inject cargo charter questions into Docket 20569. In its Order 69-6-25, the Board noted that it had considered the question of transatlantic cargo charter authority less than three years before, and it was not convinced that "the present proceedings should be expanded to include a further review of that issue at this time." In the earlier case referred to by the Board, the Supplemental Air Service Proceeding, Docket 13795, the Board had continued the authority of Seaboard World Airlines, Inc., an intervenor in the present case aligned with the Board, to operate transatlantic cargo charters along with scheduled transatlantic cargo flights.

Petitioners persisted and again asked the Board to reconsider. By Order 69-9-49, dated September 9, 1969, the Board rejected arguments similar to those now presented to us, and refused for a third time to inject questions of cargo authority into the current passenger authority proceeding. The Board stated:

The argument advanced is that, unless the Board considers the cargo-carrying competence of each applicant, it would be denying due process since the degree of an applicant's cargo ability could be a factor in its selection for licensing as a passenger carrier. We cannot accept this argument as valid and as requiring us to undertake the obviously broad expansion of the proceeding that would accompany the injection of cargo issues.

Order 69-9-49, supra.*fn2


At the outset, we must decide whether the orders denying consolidation are interlocutory and not subject to judicial review at this time. There is also a question whether the orders are ever judicially reviewable, since they involve foreign air transportation and ultimate approval by the President.*fn3 The principal authority on both of these issues is Chicago & Southern Air Lines, Inc. v. Waterman Steamship Corp., 333 U.S. 103, 92 L. Ed. 568, 68 S. Ct. 431 (1948), in which the Supreme Court dismissed a petition to review a CAB order, issued with presidential approval, which granted one application for an overseas air route and denied another. The Court held:

We conclude that orders of the Board as to certificates for overseas or foreign air transportation are not mature and are therefore not susceptible to judicial review at any time before they are finalized by Presidential approval. After such approval has been given, the final orders embody Presidential discretion as to political matters beyond the competence of the courts to adjudicate.

Id. at 114. According to the Board, petitioners are therefore not entitled to judicial intervention. On the one hand, the orders sought to be reviewed are not "final" because they fail to "impose an obligation, deny a right or fix some legal relationship as a consummation of the administrative process." Id. at 113. On the other hand, if they are "final" in the above sense, they are not reviewable because they derive their vitality "from the exercise of unreviewable Presidential discretion." Id.

To escape the dilemma posed by Waterman, petitioners attempt to place orders in a narrow area not reached by that decision. Although the matter is not free from doubt, we have previously agreed with the District of Columbia Circuit that "the Waterman case does not 'govern a situation where the action of the Board, before the matter reaches the President, is beyond the Board's power to act.'" Pan American World Airways, Inc. v. Civil Aeronautics Board, 380 F.2d 770, 775 (2d Cir. 1967), aff'd by an equally divided court, 391 U.S. 461, 88 S. Ct. 1715, 20 L. Ed. 2d 748 (1968). See American Airlines, Inc. v. Civil Aeronautics Board, 121 U.S. App. D.C. 120, 348 F.2d 349, 351-53 (D.C. Cir. 1965).*fn4 Accordingly, petitioners argue that the Board exceeded its statutory authority and acted unconstitutionally when it refused to consolidate their applications for cargo charter ...

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