Far East Conference v. Federal Maritime Commission, 18468

• Decision Date: 20 August 1964
• Docket Number: 18471,18518.,18477,18475,No. 18468,18468
• Citation: 119 US App. DC 110,337 F.2d 146
• Parties: FAR EAST CONFERENCE, Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents (two cases). NORTH ATLANTIC BALTIC FREIGHT CONFERENCE et al., Petitioners, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents. NORTH ATLANTIC CONTINENTAL FREIGHT CONFERENCE et al., Petitioners, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents. PACIFIC COAST EUROPEAN CONFERENCE, Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents.
• Court: U.S. Court of Appeals — District of Columbia Circuit

119 US App. DC 110, 337 F.2d 146 (1964)

FAR EAST CONFERENCE, Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents (two cases).

NORTH ATLANTIC BALTIC FREIGHT CONFERENCE et al., Petitioners, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents.

NORTH ATLANTIC CONTINENTAL FREIGHT CONFERENCE et al., Petitioners, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents.

PACIFIC COAST EUROPEAN CONFERENCE, Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents.

Nos. 18468, 18471, 18475, 18477, 18518.

United States Court of Appeals District of Columbia Circuit.

Argued June 29, 1964.

Decided August 20, 1964.

Certiorari Denied January 25, 1965.

Mr. Elkan Turk, Jr., New York City, with whom Mr. Seymour H. Kligler, New York City, was on the brief, for petitioner in Nos. 18,468 and 18,518.

Mr. Burton H. White, of the bar of the Court of Appeals of New York, New York City, pro hac vice, by special leave of court, with whom Mr. Arthur E. Tarantino, Washington, D. C., was on the brief, for petitioners in Nos. 18,471 and 18,475.

Mr. Charles F. Warren, Washington, D. C., for petitioner in No. 18,477.

Mr. Robert E. Mitchell, Deputy Gen. Counsel, Federal Maritime Commission, with whom Asst. Atty. Gen. William H. Orrick, Jr., Messrs. James L. Pimper, Gen. Counsel, Federal Maritime Commission, and Irwin A. Seibel, Atty., Dept. of Justice, were on the brief, for respondents.

Before WILBUR K. MILLER, FAHY and WRIGHT, Circuit Judges.

Certiorari Denied January 25, 1965. See 85 S.Ct. 704, 705.

FAHY, Circuit Judge.

Nos. 18,468, 18,471, 18,475 and 18,477 may be considered together. Each case is a petition by one or more steamship Conferences, composed of common carriers by water and organized under agreements approved by the Federal Maritime Commission under Section 15 of the Shipping Act of 1916, as amended, 75 Stat. 763, 46 U.S.C. § 814 (Supp. IV, 1961), to review orders of the Commission issued under the authority the Commission claims by reason of Section 21 of the Act.¹ The orders are not related to any proceeding pending before the Commission on a complaint, but have been issued as part of a "Foreign Trade Study" by the Commission. Section 21 authorizes the Commission to

"require any common carrier by water, or other person subject to this chapter, or any officer, receiver, trustee, lessee, agent, or employee thereof, to file with it or him any periodical or special report, or any account, record, rate, or charge, or any memorandum of any facts and transactions appertaining to the business of such carrier or other person subject to this chapter. Such report, account, record, rate, charge, or memorandum shall be under oath whenever the Board or Secretary so requires, and shall be furnished in the form and within the time prescribed by the Board or Secretary,"

followed by penalty provisions for noncompliance. 39 Stat. 736 (1916), 46 U.S.C. § 820 (1958).

Only Part I of the orders is involved.² It requires each Conference, as agent for its common carrier members, to produce at the Commission's offices in Washington, D. C., as follows:

a. A copy of any letters, memoranda, circulars, and other correspondence or documents exchanged between the conference and any of its common carrier member lines and/or any of their agents, during the period January 1, 1962 through September 30, 1963, relating to rates on any of the commodities listed in Attachment A hereto. Documents which merely list or state such rates without discussion need not be furnished.

b. A copy of any reports, studies, analyses or documents compiled by or for or received by the conference between January 1, 1959 and September 30, 1963, with respect to all rates charged by the conference. Documents which merely list or state such rates without discussion need not be furnished.

Whenever any of the foregoing information has been otherwise furnished to the Commission, at the request of the Commission, a statement to that effect identifying the matter filed and the time of such filing, may be submitted in lieu of the matter requested.

This request was preceded by a recitation of the requirements of certain provisions of the Shipping Act³ and a statement that production of the requested data was necessary "in order that the Commission may be properly informed as to matters bearing upon its responsibilities under these statutory provisions, and to determine what action if any it should take pursuant to such statutory provisions * * *."

Accompanying each order was a letter from the Chairman of the Commission stating that certain rates and charges applicable to cargo from certain ports of the United States to certain foreign ports exceeded those applicable to cargo from the foreign ports to ports of the United States, particularly with respect to the commodities listed in Attachment A to the orders; and that the Commission was considering institution of an investigation of the matter pursuant to Section 212(e) of the Merchant Marine Act, 1936, and/or rate proceedings to determine the issue of the detrimental character of the rates within the meaning of Section 18(a) (5) of the Shipping Act, 1916, as amended. The letter continued,

"Prior to the institution of proceedings pursuant to the aforementioned statutory provisions, and if possible to obviate the necessity therefor, we request that you take immediate steps to make appropriate adjustments in your tariffs, particularly with respect to the rates on the commodities enumerated in Attachment A, or that you submit to the Commission statements setting forth all facts and conditions which explain or justify the higher export rates published by your conference. We request your compliance with the foregoing on or before December 15, 1963. For the purpose of evaluating your statement and determining whether formal proceedings should be instituted, the Commission is also requiring that you furnish the information described in the accompanying order issued pursuant to Section 21 of the Shipping Act, 1916.⁴

The question is whether the orders are valid. We note first the contention, pressed in No. 18,477, that the letter accompanying the order demonstrates that the Commission's purpose was to force a reduction in rates by requiring the Conferences to "reduce or produce", and that such a coercive tactic constitutes an invalid exercise of administrative authority. We can find no such coercive purpose in the combination of the order and the letter since, as we view the matter, the information requested was to be supplied whether or not the letter itself led to the rate adjustments suggested. We have the question whether the orders are valid, not the letters. We cannot hold the orders invalid if, considered apart from the letters, they are within the Commission's authority. Isbrandtsen-Moller Co. v. United States, 300 U.S. 139, 145, 57 S.Ct. 407, 81 L.Ed. 562 (1937).

As to this we bear in mind the broad regulatory responsibilities of the Commission, considered with the exemption enjoyed by the Conferences from the antitrust laws by reason of Commission approval of Conference agreements. See Isbrandtsen Co. v. United States, 93 U.S. App.D.C. 293, 297, 211 F.2d 51, 55, cert. denied, Federal Maritime Board v. United States, 347 U.S. 990, 74 S.Ct. 852, 98 L.Ed. 1124 (1954). Within these broad responsibilities is lodged the specific authority here sought to be exercised. As to this we cannot accept petitioners' suggestion that Section 21 orders must be limited to complaint proceedings. They are available to aid investigation without the need for the support of a charge of violation of the Act, or belief even that such a violation is probable. Isbrandtsen-Moller Co. v. United States, supra, 300 U.S. at 144, 57 S.Ct. 407. In this respect the discussion by the Supreme Court in United States v. Morton Salt Co., 338 U.S. 632, 652, 70 S.Ct. 357, 94 L.Ed. 401 (1950), is applicable, though that case involved the investigatory powers of the Federal Trade Commission and not of the Maritime Commission. And see Pacific Westbound Conf. v. United States, 332 F.2d 49 (9th Cir. 1964). Cf. Montship Lines, Ltd. v. Federal Maritime Board, 111 U.S. App.D.C. 160, 166, 295 F.2d 147, 153 (1961).

We need not discuss whether or not the data demanded, if the demand is otherwise valid, is of the type obtainable under Section 21, namely, "any periodical or special report, or any account, record, rate, or charge, or any memorandum of any facts and transactions appertaining to the business of such carrier or other person subject to this Act"; for petitioners accept the view of the Commission in this respect. At least they do not dispute it in these cases, no doubt in part because of the views expressed by this court in Montship, supra, as to the broad construction to be given the enumeration in Section 21 of the kind of data the Commission may require.⁵

There is a contention, however, that a Conference is not an entity to which a Section 21 order may be applied. That section is applicable to "any common carrier by water" or "other person subject to this Act," or "any officer, receiver, trustee, lessee, agent or employee" thereof. The fact is that the Conferences are in many respects agents of the carriers which compose them. If the Conferences are in possession of the data, and the data is otherwise validly sought, it may not be refused on the theory the Conferences are not answerable to a Section 21 order.

Petitioners also contend that the orders are invalid because the data sought is not reasonably related to the Commission's statutory authority over rates in foreign commerce. They claim that the Commission's only source of control over such rates is Section 18(b) (5) which requires Commission disapproval of rates found "to be so unreasonably high or low as to be detrimental to the commerce of the United States," and under this limited statutory authority the...