Schneider Nat., Inc. v. I.C.C., 90-3868

Decision Date19 November 1991
Docket NumberNo. 90-3868,90-3868
PartiesSCHNEIDER NATIONAL, INCORPORATED, Schneider Transport, Incorporated, Schneider National Carriers, Incorporated, Schneider Tank Lines, Incorporated, Schneider Specialized Carriers, Incorporated, Schneider National Fleet Services, Incorporated, Schneider National Bulk Carriers, Incorporated, Petitioners, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents.
CourtU.S. Court of Appeals — Seventh Circuit

Daniel C. Sullivan (argued), Sullivan & Associates, Oak Brook, Ill., for petitioners.

Ira H. Raphaelson, Asst. U.S. Atty., Crim. Div., Chicago, Ill., Robert S. Burk, Theodore K. Kalick (argued), Interstate Commerce Com'n, Office of the General Counsel, Richard L. Thornburgh, U.S. Atty. Gen., Washington, D.C., William Redmond, Interstate Commerce Com'n, Compliance & Consumer Assistance, Chicago, Ill., for respondents.

Before CUMMINGS, WOOD, Jr., and KANNE, Circuit Judges.

HARLINGTON WOOD, Jr., Circuit Judge.

The petitioners, Schneider National, Incorporated and six of its wholly-owned motor carrier affiliates (hereafter collectively referred to as "Schneider"), seek review of a final order of the respondent, the Interstate Commerce Commission ("ICC" or "Commission"), denying Schneider's request for reinstatement of exemptions from ICC accounting and reporting requirements under 49 C.F.R. §§ 1207, 1249. Schneider contends that the company would be forced to implement a new accounting system at great cost in order to comply with the reporting requirements. Schneider argues further that the cost of the implementation has no corresponding benefit to the Commission and is arbitrarily and capriciously illogical. The ICC counters that the newly revised reporting requirements are substantially reduced and that the lesser reporting requirements, consequently, lead to reduced accounting burdens. Moreover, the ICC believes Schneider greatly overstates the burden of converting its accounts to the format required by agency regulations.

The circuitous course of these proceedings has generated several orders. Schneider has requested that we review each of the ICC rulings involved in this case. The first is the ICC letter order revoking Schneider's exemptions from the agency's accounting and reporting requirements. The second is the ICC's denial of Schneider's petition for reinstatement of the exemptions. The final order that we have been requested to review is the ICC's decision rejecting Schneider's petition to reopen, or reconsider, the denial of reinstatement of exemptions and the ICC's denial of We hold that there is no jurisdiction to review the ICC's first order revoking Schneider's exemptions from agency accounting and reporting requirements because Schneider did not timely appeal the orders to this court pursuant to the Hobbs Act. 1 There is also no jurisdiction to review the ICC's last order in this case because the ICC's decision to deny reconsideration of a previous decision is committed to the agency's discretion when the petition requesting reconsideration is based on "material error." There is jurisdiction to review the ICC's denial of Schneider's request to reinstate the exemptions. We affirm the ICC's denial because the Commission's decision not to reinstate the exemptions was neither arbitrary nor capricious and is, therefore, lawful.

Schneider's request for a stay of the agency's order to comply with reporting and accounting regulations.

FACTUAL BACKGROUND AND PROCEDURAL POSTURE

Schneider National and its trucking subsidiaries are "special commodities carriers" ("SCCs"). SCCs transport bulk liquid chemicals, foodstuffs, raw and finished paper, and other products using specialized equipment. See Classification of Motor Carriers of Property, 2 M.C.C. 703 (1937). SCCs such as Schneider transport shipments by contract carriage as opposed to common carriage. Because of this arrangement Schneider does not participate in collectively set rates. Prior to revising the reporting regulations, see Elimination of Accounting and Reporting Requirements for Motor Carriers of Property, 5 I.C.C.2d 17 (1988), the ICC granted Schneider and approximately 40 other SCCs relief from agency reporting and accounting requirements. At least one of the reasons for the exemption was the fact that SCCs do not participate in collectively set rates.

Schneider National, Incorporated and four of its wholly-owned subsidiaries received exemptions from the ICC's accounting and reporting requirements under 49 C.F.R. §§ 1207, 1249, on May 17, 1985. Four years later, the ICC sent to Schneider a letter dated June 7, 1989, stating that the Commission had voted unanimously by notation to revoke the exemptions.

Schneider filed with the ICC a petition entitled "Petition for Reinstatement of Exemption" on September 1, 1989. The Commission voted to deny Schneider's petition, stating that there was no justification under the newly revised rules for relieving Schneider from the reporting requirements. The ICC notified Schneider of its decision by letter served on September 12, 1990.

Schneider next filed with the ICC on October 2, 1990, a petition to reopen the denial of its previous petition for reinstatement of exemption. Schneider also requested a stay of the Commission's denial order. The Commission rejected Schneider's petition to reopen and review and also denied the petition for stay by Decision No. 40489, served on November 2, 1990.

On November 28, 1990, Schneider submitted to the ICC a petition for stay pending request for judicial review of the Commission's November 2 order. Schneider's petition was denied in ICC Decision No. 40489, served on December 26, 1990.

On December 28, 1990, Schneider filed in this court a petition for review of ICC Decision No. 40489. Schneider requested that this court: (1) reverse the ICC's June 7, 1989, decision that revoked Schneider's exemption from agency accounting and reporting requirements; (2) reverse the ICC's decision served September 12, 1990, denying Schneider's request for reinstatement of the exemption; and (3) reverse the ICC's order served on November 2, 1990, denying Schneider's petition for stay and rejecting its petition to reopen. Schneider requests finally that this court reinstate its exemption.

This court denied Schneider's motion to stay the ICC's order pending appellate review by order entered on March 14, 1991.

DISCUSSION

Schneider has requested review of each of the ICC's orders in this case according to the provisions for judicial review found in the Administrative Procedure Act (APA), 5 U.S.C. § 706(2) (1978). However, before any review of agency action can be had, the court must have jurisdiction. We consider each of the ICC's orders in turn.

June 13, 1989, Order

The ICC notified Schneider by letter dated June 7, 1989, that the company's exemption from agency reporting requirements had been revoked by a unanimous vote of the Commission. Schneider waited almost three months before submitting to the ICC a "Petition for Reinstatement of Exemption." Moreover, Schneider did not seek review of the letter order in this court. Instead, Schneider now seeks review of the revocation order through review of its subsequent petitions of later ICC rulings in these proceedings. Because Schneider did not timely appeal the ICC's letter order revoking Schneider's exemption to the court of appeals, we do not have jurisdiction to review the order.

The Administrative Orders Review Act ("Hobbs Act") grants the court of appeals jurisdiction to review all final orders of the ICC. 28 U.S.C. § 2342(5) (1978). The Act provides further a 60-day limitations in which a party aggrieved by a reviewable final order may file a petition. 28 U.S.C. § 2344 (1978). This time limit is jurisdictional and may not be enlarged by the courts. Illinois Central Gulf R.R. Co. v. ICC, 720 F.2d 958, 960 (7th Cir.1983); Atchison, Topeka and Santa Fe Ry. Co. v. ICC, 687 F.2d 912, 918 (7th Cir.1982).

The revocation letter was a final order of the ICC. The order became final effective upon the date of service because Schneider did not appeal the ICC's order within 20 days of the date of service. See 49 C.F.R. § 1115.3 (1990). When an ICC order is timely appealed to the agency, the order becomes nonfinal. If, however, it is not timely appealed, the order becomes administratively final effective on the date of service. Schneider did not appeal the ICC's revocation order within 20 days of service; thus, the order became final as of the date that the ICC served the order to Schneider. 2 If this court were to have jurisdiction to review the order, Schneider was required to petition this court for appeal within 60 days of the effective date. Schneider never appealed the revocation letter to this court, and we cannot look beyond Schneider's subsequent petitions to reach the original order when appeal is not timely.

Schneider argues in defense of its tardiness that the letter from the ICC Bureau of Accounts revoking Schneider's exemption is not an order of the Commission; and hence, it is not a "decision" required to be appealed within 20 days according to 49 C.F.R. § 1115.3. We disagree. The ICC's Rules of General Applicability define ICC "decisions" in 49 C.F.R. § 1101.2(c). That section states: " 'Decision' means any formal published action of the Commission including orders and notices." 49 C.F.R. § 1101.2 (1990) (emphasis added). The ICC's revocation letter is an order and thus falls within the definition of "decision." 3

We conclude that the revocation letter falls under the agency definition of "decision" by looking to the requirements for review of administrative action found in the Hobbs Act. Only final orders are reviewable. 28 U.S.C. § 2342(5) (1978). ICC orders are clearly reviewable when those orders affect the rights of the parties, or when the orders touch "vital interests" of the parties. Texas v. United...

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