Borough of Moosic v. United States, Civ. A. No. 10054.
Decision Date | 13 July 1967 |
Docket Number | Civ. A. No. 10054. |
Citation | 272 F. Supp. 513 |
Parties | BOROUGH OF MOOSIC, Plaintiff, Milton J. Shapp and City of Scranton, Intervening Plaintiffs, v. UNITED STATES of America, Defendant, and Interstate Commerce Commission, New York Central Railroad Company, and Pennsylvania Railroad Company, Intervening Defendants. |
Court | U.S. District Court — Middle District of Pennsylvania |
Christopher T. Powell, Scranton, Pa., Gordon P. MacDougall, Leon H. Keyserling, Washington, D. C., Israel Packel, Philadelphia, Pa., Robert P. Casey, Scranton, Pa., for Borough of Moosic.
Bernard J. Brown, U. S. Atty., Scranton, Pa., Howard E. Shapiro, Dept. of Justice, Robert W. Ginnane, ICC, Jerome Nelson, ICC, Washington, D. C., for United States.
Egli, Walter, Long & Reilly, Lebanon, Pa., Clark, Ladner, Fortenbaugh & Young, Philadelphia, Pa., Howard J. Trienens, of Sidley & Austin, Chicago, Ill., for Norfolk and Western Ry. Co.
Joseph E. Gallagher, Scranton, Pa., Windsor F. Cousins, Philadelphia, Pa., Hugh B. Cox and Henry P. Sailor, Washington, D. C., for Pennsylvania R. Co.
James B. Gray and Jerome Shapiro, New York City, Joseph E. Gallagher, Scranton, Pa., for New York Central R. Co.
J. Julius Levy, Scranton, Pa., Paul Coughlin, Jr., of Nixon, Mudge, Rose, Guthrie, Alexander & Mitchell, New York City, for Delaware and Hudson R. Co.
Warren, Hill, Henkelman & McMenamin, Scranton, Pa., Thomas D. Barr, of Cravath, Swaine & Moore, New York City, for Erie-Lackawanna R. Co.
William P. Quinn, Philadelphia, Pa., for Reading Co.
Martin J. Flynn, of Gardner & Shea, Washington, D. C., for Central R. Co. of New Jersey.
Harvey Gelb, Scranton, Pa., for City of Scranton.
Joseph F. McCloskey, Pottsville, Pa., for City of Pottsville.
Gordon P. MacDougall, Washington, D. C., Israel Packel, Philadelphia, Pa., for Milton J. Shapp.
Robert M. Harris, Asst. Counsel, Harrisburg, Pa., for Commonwealth of Pennsylvania.
Edward G. Bauer, Jr., City Sol., Matthew W. Bullock, Jr., Second Deputy City Sol., Herbert Smolen, Asst. City Sol., Philadelphia, Pa., for City of Philadelphia.
Before VAN DUSEN, Circuit Judge, and SHERIDAN and NEALON, District Judges.
MEMORANDUM SUR MOTIONS OF DEFENDANT AND INTERVENING DEFENDANTS FOR A STAY
This action seeks to enjoin permanently, set aside and annul these June 9, 1967 (served June 12) Orders of the Interstate Commerce Commission under 28 U.S.C. § 1336:
This case is now before the court on motions of defendant and intervening defendants for a stay of all proceedings. The background of the I. C. C. proceedings and court cases leading up to the application for a stay of proceedings is summarized in Erie Lackawanna Railroad Co. v. United States, 259 F.Supp. 964 (S.D.N.Y.1966); Baltimore & O. R. Co. v. United States, 386 U.S. 372, 87 S. Ct. 1100, 18 L.Ed.2d 159 (1967); Erie-Lackawanna Railroad Company v. United States of America et al., (S.D.N.Y. 66 Civ. 2860, 2903 & 2914, Memorandum Order of 7/3/67).2 On the morning of July 7, 1967, the I.C.C. postponed the effective date of the inclusion order covering the Erie-Lackawanna Railroad Company (E-L), Delaware and Hudson Railroad Company (D & H), and the Boston and Maine Corporation (B & M) in the I. C. C. N & W-Nickel Plate merger proceeding pending its decision on petitions for reconsideration of the June inclusion order in the N & W-Nickel Plate merger proceedings by B & M and D & H.
These mergers have been considered by the I. C. C. as incident to what the Supreme Court of the United States has described as "the desire of the Congress that the industry proceed toward an integrated national transportation system through substantial corporate simplification." County of Marin v. United States, 356 U.S. 412, 417-418, 78 S.Ct. 880, 883, 2 L.Ed.2d 879 (1958), which was quoted with approval in Baltimore & O. R. Co. v. United States, 386 U.S. 372, 387, 87 S.Ct. 1100, 18 L.Ed.2d 159 (1967).
The Supreme Court of the United States has emphasized the need for expedition of all litigation challenging the Penn-Central merger, using this language in Baltimore & O. R. Co. v. United States, supra, at 392, 87 S.Ct. at 1110:
At the hearing on the above Motion on July 7, the United States and the Interstate Commerce Commission stipulated of record that as defendants in the above-mentioned civil actions pending in the United States District Court for the Southern District of New York, they would make no objection to, and would welcome, the intervention of plaintiff in this action as an intervening plaintiff there prior to the July 17 deadline established by that court in its July 3 Memorandum Order and that, in the interest of prompt dispatch of the important federal judicial litigation, which is involved in this case, plaintiff's complaint should be considered by the above-mentioned New York Federal Court. Trial counsel for the City of Scranton and Mr. Shapp, who have been active intervenors in the New York Federal Court since the inception of 66 Civ. 2860, is also one of counsel for plaintiff. An examination of the complaint filed in this action (VIII A on pages 5-10) discloses that it is virtually identical with the complaint of such intervening plaintiffs in 66 Civ. 2860 insofar as such complaints attack the Penn-Central merger. Subsections y-bb (four subparagraphs) of this Complaint, which are not in the Complaint in 66 Civ. 2860, challenge inclusion of the New Haven Railroad in the merger and the failure to consider reported earnings of Penn-Central for the first three months of 1967. No reason has been shown why these matters cannot be raised in 66 Civ. 2860 before July 17.
Also, many of the issues covered by this complaint may be covered by the scheduled final hearing to be held before the New York Federal Court on September 18, 1967. In the Memorandum Order of July 3, 1967, this language appears:
It is not clear exactly how many issues challenged by the attack made in VIII B and C (pages 10-12) of this complaint will be considered at the New York Federal Court's final hearing on September 18. However, the above-quoted language from the July 3 Memorandum Order makes it likely that most, if not all, of them will be so considered if they are raised in supplemental complaints or an intervening complaint filed by the plaintiff on or before July 17.3 An application to modify the stay of proceedings in this case may be made, if appropriate, after August 8, when the supplemental complaints and briefs of the moving parties have been filed in New York Federal Court cases. Also, it is noted that the basic attack in this complaint is on the Penn-Central merger and plaintiff contends the railroads in its Borough (E-L and D & H) were forced to apply to participate in the N & W merger by the Penn-Central merger proposal.
The venue language of 28 U.S.C. § 1398 does not preclude the granting of a stay in a proceeding to enjoin an order of the I. C. C. in view of this language of the Supreme Court of the United States in Kansas City Southern Ry. v. United States, 282 U.S. 760, 763-764, 51 S.Ct. 304, 306, 75 L.Ed. 684 (1931):
"The question is thus one for the sound discretion of the District Court, in which such a suit is brought, to determine whether it should be permitted to continue or proceedings therein should be stayed, pending the final outcome of an earlier suit for the same purpose, to the end that there may not be a multiplicity of suits without substantial reason. * * *" Emphasis added.
Both the Supreme Court of the United States and the United States Court of Appeals for the Third Circuit have stated that the rule that "the court which first has possession of the subject must decide it" is "salutary." See...
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ERIE-LACKAWANNA RAILROAD COMPANY v. United States
...and (2) the City of Scranton and Milton J. Shapp from taking any further action in Civil Action No. 10054, Borough of Moosic et al. v. United States, 272 F.Supp. 513 before the United States District Court for the Middle District of pending final determination of the instant actions by this......