City of Pittsburgh v. Federal Power Commission

• Decision Date: 08 March 1956
• Docket Number: No. 12895.,12895.
• Citation: 99 US App. DC 113,237 F.2d 741
• Parties: CITY OF PITTSBURGH, Chotin Towing Corporation, and Greenville Towing Company, Inc., Petitioners, v. FEDERAL POWER COMMISSION, Respondent, Texas Eastern Transmission Corporation, Intervenor.
• Court: U.S. Court of Appeals — District of Columbia Circuit

99 US App. DC 113, 237 F.2d 741 (1956)

CITY OF PITTSBURGH, Chotin Towing Corporation, and Greenville Towing Company, Inc., Petitioners, v. FEDERAL POWER COMMISSION, Respondent, Texas Eastern Transmission Corporation, Intervenor.

No. 12895.

United States Court of Appeals District of Columbia Circuit.

Argued December 9, 1955.

Decided March 8, 1956.

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Messrs. Robert Engel, of the bar of the Supreme Court of Pennsylvania, Pittsburgh, Pa., pro hac vice, by special leave of Court, and Harold Leventhal, with whom Mr. Bryce Rea, Jr., Washington, D. C., was on the brief, for petitioners.

Mr. William J. Grove, Asst. Gen. Counsel, Federal Power Commission, with whom Mr. Willard W. Gatchell, Gen. Counsel, Federal Power Commission, was on the brief, for respondent.

Messrs. R. Clyde Hargrove, of the bar of the Supreme Court of Louisiana, Shreveport, La., pro hac vice, by special leave of Court, and Charles I. Thompson, Philadelphia, Pa., for intervenor.

Mr. Martin L. Friedman, Washington, D. C., also entered an appearance for intervenor.

Before EDGERTON, Chief Judge, and BAZELON and BASTIAN, Circuit Judges.

BAZELON, Circuit Judge.

This is a petition to review and set aside an order of the Federal Power Commission under § 7 of the Natural Gas Act¹ granting the application of Texas Eastern Transmission Corporation for a certificate of public convenience and necessity. The certificate authorized abandonment of the Little Inch pipeline between Baytown, Texas, and Moundsville, West Virginia, as a natural gas pipeline. As a substitute, the certificate authorized construction of (1) a tie-line connecting the Baytown area to the Company's Kosciusko line at Kosciusko, Mississippi, and (2) additional compression facilities on the Kosciusko line from Kosciusko to Connelsville, Pennsylvania. The petitioners seeking review of the order are (1) Chotin Towing Corporation and Greenville Towing Company, Inc., operators of barges carrying petroleum products on the Mississippi and Ohio River systems, and (2) the City of Pittsburgh, Pennsylvania. They were parties to the proceedings before the Commission, having intervened by leave of the Commission. Texas Eastern, the certificate holder, has intervened in this court.

The Commission and Texas Eastern have moved to dismiss the petition for review on the ground that the petitioners are not "aggrieved" by the order within the meaning of § 19(b) of the Act.²

The Barge Operators' Standing.

"The basic and motivating reason underlying Texas Eastern's application," as found by the Commission, is to make the Little Inch pipeline available for petroleum products. The barge operators allege that Texas Eastern competes with them in supplying fuels to eastern markets and that the Commission's order will increase that competition by adding petroleum products to natural gas as the source of the competition. This would seem to give standing under the principle of National Coal Ass'n v. Federal Power Comm.³ The Commission and Texas Eastern argue that National Coal is inapplicable because (1) impact of the Little Inch conversion upon the petroleum products transportation industry is not a factor which the Natural Gas Act authorizes the Commission to consider in determining whether abandonment of a gas pipeline serves the public convenience and necessity; (2) the barge operators' aggrievement is not by order of the Commission and, in any event, not direct and immediate; (3) this case is controlled by Singer & Sons v. Union Pacific R. R.;⁴ and (4) even if the barge operators have alleged sufficient injury, they have failed to prove it and so were correctly found by the Commission not to be aggrieved by the order. We think these arguments must fail.

(1) In National Coal we held that, since natural gas and coal are competitive fuels, an association of coal mine operators, some of whom sold to the same market as a projected natural gas service, were "aggrieved" by an order authorizing gas service and entitled to review of the order. We recognized a similar right of review in a union whose members included employees of those coal mines and a union whose members included employees of the railroads delivering fuels to the market in question. We did not imply that the Federal Power Commission was authorized to deny a certificate of public convenience and necessity for a natural gas pipeline merely because of the adverse effect upon producers and carriers of a competing fuel and their employees. We held merely that parties so affected were authorized to seek review of the substantive issues involved in determining whether or not the public convenience and necessity would be served. We relied upon the Sanders and Scripps-Howard cases⁵ and Judge Frank's decision in Associated Industries v. Ickes.⁶ Those cases make clear that aggrievement, within the meaning of § 19(b) and other review statutes, is a status conferred by Congress upon a party who, though he may have no interests that must be considered in the administrative determination, is likely to suffer injury by that determination. He may be "the only person having a sufficient interest to bring to the attention of the appellate court errors of law in the action of the Commission in granting the license. It is within the power of Congress to confer such standing to prosecute an appeal."⁷ It does not matter whether competitive injury to the barge operators is "in and of itself, and apart from considerations of public convenience, interest, or necessity, an element the Commission must weigh."⁸

(2) The argument that the barge operators' injury would result from conversion of Little Inch, rather than from the order, and would therefore not be "direct and immediate injury" within National Coal rests on the notion that the conversion is a matter of free election by Texas Eastern, wholly independent of the Commission's order authorizing abandonment of the natural gas pipeline. The record is clear, however, that Texas Eastern has embarked upon an integrated project of conversion of one pipeline to petroleum products and the substitution of another for transporting natural gas, and that entry into petroleum products transportation is "the basic motivating reason underlying this application" to the Commission.⁹ The injury to the barge operators resulting from the conversion flows directly enough from the Commission's order, even though the order does not expressly require conversion.¹⁰

(3) Singer & Sons v. Union Pacific R.R.¹¹ was a suit by traders in a city market to enjoin a railroad from extending its track to a rival market. Section 402, paragraph 20 of the Transportation Act of 1920 authorizes a "party in interest" inter alia to sue to enjoin a railroad from extending its lines without a certificate of convenience and necessity from the Interstate Commerce Commission.¹² The Supreme Court affirmed dismissal of the suit for lack of standing. The case is inapplicable here for the following reasons:

(a) The Transportation Act authorizes suits by the Attorney General, the Interstate Commerce Commission, commissions or regulatory bodies of affected states, or "`any party in interest.'"¹³ The Natural Gas Act makes no provision for the correction of administrative errors by anyone other than those "aggrieved" parties whose self-interest impels them to activity. Whereas allowing private parties to litigate in a situation like Singer might "invite dislocation of the scheme which Congress has devised for the expert conduct of the litigation",¹⁴ it is the very method chosen by Congress to test the validity of administrative action under the Natural Gas Act.

(b) Mr. Justice Frankfurter¹⁵ points out that, if the railroad had applied for a certificate under paragraph 18 of 49 U.S.C.A. § 1 and Singer & Sons had participated in the certification proceeding before the I.C.C., the Singer firm might then have been deemed a party in interest "in the further pursuit of claims before a court after adverse action by the Commission."¹⁶ That was the Sanders case and that is also this case.

(c) The injury to the barge operators here may, like that in Sanders, give them "sufficient interest to bring to the attention of the appellate court errors of law in the action of the Commission",¹⁷ even if it be not sufficiently direct and immediate to support a suit in the district court.¹⁸

(4) At the administrative hearing, the barge operators made a proffer of proof that (a) they are two of the 25 to 30 barge operators now carrying petroleum products to the market sought by Texas Eastern; (b) the total volume of that market is about 100,000 barrels per day and will so remain for several years; (c) to make Little Inch economically possible as a products carrier, Texas Eastern would have to deliver about 100,000 barrels per day and its income forecasts require volumes far in excess of that figure; (d) Texas Eastern would thus require the entire available market and, because of advantages derived from the relation of its products business to its gas business and the acquisition of Little Inch at a depreciated price, Texas Eastern could succeed in capturing the entire market, including that part of it enjoyed by these petitioners. Exclusion of proffered proof was error.¹⁹ Having precluded the barge operators from proving injury, the Commission cannot now be heard to complain that the record contains no proof.

Pittsburgh's Standing.

The City of Pittsburgh and its residents are consumers of natural gas delivered through the Little Inch pipeline. It is conceded that Pittsburgh would be aggrieved by a reduction of supply or increase of cost of gas to the consumer. But there is nothing in this record to show that this order would immediately have such consequences and Pittsburgh does not claim that it will.²⁰ What Pittsburgh claims is that the Kosciusko line can, at relatively little cost, be expanded to carry...