Baggett Transportation Co. v. Hughes Transportation, Inc.

• Decision Date: 28 May 1968
• Docket Number: No. 19149.,19149.
• Parties: BAGGETT TRANSPORTATION COMPANY, Appellant, v. HUGHES TRANSPORTATION, INC., and Interstate Commerce Commission, Appellees.
• Court: U.S. Court of Appeals — Eighth Circuit

393 F.2d 710 (1968)

BAGGETT TRANSPORTATION COMPANY, Appellant, v. HUGHES TRANSPORTATION, INC., and Interstate Commerce Commission, Appellees.

No. 19149.

United States Court of Appeals Eighth Circuit.

April 30, 1968.

Rehearing Denied May 28, 1968.

COPYRIGHT MATERIAL OMITTED

Robert E. Joyner, of Wrape & Hernly, Memphis, Tenn., for appellant; Lee Reeder, of Reeder, Griffin & Dysart, Kansas City, Mo., and William G. Somerville, Jr., Lange, Simpson, Robinson & Somerville, Birmingham, Ala., on the brief and reply brief.

Thomas W. VanDyke, of Linde, Thomson, VanDyke, Fairchild & Langworthy, Kansas City, Mo., for appellee, Hughes Transportation, Inc.; Albert Thomson, Kansas City, Mo., and Frank B. Hand, Jr., Washington, D. C., on the brief.

Harry F. Horak, Fort Worth, Tex., for appellee, Interstate Commerce Commission; Bernard A. Gould, Bureau of Enforcement, Interstate Commerce Commission, Washington, D. C., on the brief.

Before VOGEL, Senior Circuit Judge, and BLACKMUN and LAY, Circuit Judges.

VOGEL, Senior Circuit Judge.

Baggett Transportation Company, defendant-appellant, hereinafter referred to as Baggett, appeals from an order entered January 8, 1968, by the United States District Court for the Western District of Missouri, Southwestern Division, which order granted a temporary injunction against Baggett in a suit brought by Hughes Transportation, Inc., plaintiff-appellee, a competing motor common carrier, such action being instituted pursuant to 49 U.S.C.A. § 322(b) (2); Pub.L. 89-170, 79 Stat. 649 (1965). We have jurisdiction of this appeal under 28 U.S.C.A. § 1292(a) (1). A chronology of the events leading up to the granting of the temporary injunction is essential.

On May 10, 1966, Tri-State Motor Transit Company, hereinafter Tri-State, (Hughes is a wholly owned subsidiary of Tri-State) commenced a civil injunction action against Baggett pursuant to the provisions of 49 U.S.C.A. § 322(b) (2). Such case was docketed as civil action No. 2000 in the Western District of Missouri, Southwestern Division.¹ On June 16, 1966, the Interstate Commerce Commission instituted an investigation proceeding in No. MC-C-5213 entitled "Baggett Transportation Company — Investigation and Revocation of Certificates". The ICC then filed in civil action No. 2000 a notice pursuant to 49 U.S.C.A. § 322(b) (3) advising the District Court that it was considering the issues involved in such suit. Thereupon the District Court entered an order staying that action. On September 8, 1967, the ICC rendered its decision in No. MC-C-5213 construing Baggett's certificate of public convenience and necessity and finding that it was not authorized to render the type of service being performed by it and ordered it to cease and desist from such operations. The order of the ICC was to become effective on November 9, 1967.

On October 31, 1967, Baggett filed an action against the ICC and the United States of America in the District Court for the Northern District of Alabama, requesting the designation of a Three-Judge Court under the provisions of 28 U.S.C.A. § 2284, to review, set aside and enjoin the enforcement of the ICC's order. Baggett's motion for a temporary restraining order under 28 U.S.C.A. § 2284(3) was heard by Chief Judge Seybourn H. Lynne at Birmingham, Alabama, on November 6, 1967.

Judge Lynne, being advised of the proceedings before Judge Hunter in the Western District of Missouri, withheld entering any order, preferring to await the outcome of civil action No. 2000 which was set for trial before Judge Hunter on November 8, 1967. At the conclusion of the hearing on November 8, 1967, Judge Hunter terminated the stay theretofore entered. He further held that he would not enter a temporary injunction in view of the fact that the ICC order requiring Baggett to cease and desist went into effect at midnight on that day. Judge Hunter's ruling in civil action No. 2000 was made at 4:00 o'clock p.m. on November 8, 1967. That evening at about 9:00 p. m. Baggett's attorneys obtained a restraining order from Judge Lynne at Birmingham, Alabama, enjoining the enforcement and effectiveness of the ICC's cease and desist order.

On December 15, 1967, Hughes, the wholly owned subsidiary of Tri-State, filed the instant action in the Western District of Missouri, the same being docketed as civil action No. 2079. It asked for an injunction against Baggett to restrain Baggett from performing operations in interstate commerce contrary to the provisions of Baggett's operating certificate of public convenience and necessity. At the same time Hughes asked for a temporary injunction. Baggett filed its answer and the ICC filed its motion for leave to intervene as party plaintiff. (On this appeal the ICC continues to support the position of Hughes, and has filed brief and had its counsel present oral argument.) A hearing on Hughes' motion for temporary injunction was heard on December 27, 1967, by Judge Hunter who, after taking the matter under advisement, did on January 8, 1968, render his memorandum opinion and order enjoining Baggett from tacking or joining, directly or indirectly, any two or more segments of its authority in No. MC-76177, Sup. 273, upon condition that Hughes file an approved bond in the amount of $100,000 to protect the interests of Baggett should the temporary injunction be later proven unwarranted by the facts and circumstances. Such bond was filed and approved on January 8, 1968, the same day as Judge Hunter's order was entered.

49 U.S.C.A. § 322(b) (2) provides, insofar as it may be pertinent herein:

"If any person operates in clear and patent violation of any provisions of section 303(c), 306, 309, or 311 of this title, or any rule, regulation, requirement, or order thereunder, any person injured thereby may apply to the district court of the United States for any district where such person so violating operates, for the enforcement of such section, or of such rule, regulation, requirement, or order. The court shall have jurisdiction to enforce obedience thereto by a writ of injunction or by other process, mandatory or otherwise, restraining such person, his or its officers, agents, employees, and representatives from further violation of such section or of such rule, regulation, requirement, or order; and enjoining upon it or them obedience thereto. A copy of any application for relief filed pursuant to this paragraph shall be served upon the Commission and a certificate of such service shall appear in such application. The Commission may appear as of right in any such action. The party who or which prevails in any such action may, in the discretion of the court, recover reasonable attorney\'s fees to be fixed by the court, in addition to any costs allowable, under the the Federal Rules of Civil Procedure, and the plaintiff instituting such action shall be required to give security, in such sum as the court deems proper to protect the interests of the party or parties against whom any temporary restraining order, temporary injunctive, or other process is issued should it later be proven unwarranted by the facts and circumstances."

The foregoing section was a 1965 amendment, the purpose of which was to "afford injured parties a measure of self-protection against operations which are openly and obviously unlawful". 1965 U.S.Code Cong. & Adm.News, Vol. 2, at p. 2931. Prior thereto only the Commission could go into District Court and obtain an enforcement order. Obviously, the Congress desired to expedite the remedy where "clear and patent" violations were established.

Baggett's certificate of public convenience and necessity contained the following restriction:

"* * * No single portion of the authority contained hereinabove shall be tacked or joined, directly or indirectly, with any other authority contained hereinabove for the purpose of performing any through service."

Judge Hunter found that Baggett had been operating and would continue to operate in clear and patent violation of §§ 303(c) and 306 of Title 49; that its tacking of its various authorities was in direct opposition to the restriction contained in its certificate and clearly exceeded the authority granted it.

The primary question on appeal relates to the right and propriety of the District Court for the Western District of Missouri to entertain and issue the injunction when there was pending at the same time the review action in the District Court for the Northern District of Alabama.

First, we make the general observation that the granting of a temporary injunction is addressed to the discretion of the trial court and not that of the appellate court. The merits of the case will not be considered excepting only as their consideration may be necessary to determine whether the trial court "* * * improvidently exercised its judicial discretion." 7 Moore Federal Practice, § 65.04 2 at 1630-31; Benson Hotel Corp. v. Woods, 8 Cir., 1948, 168 F.2d 694.

It is the contention of Baggett, the appellant herein, that the complained-of injunction entered January 8, 1968, by Judge Hunter of the Western District of Missouri had the direct effect of nullifying the order of Judge Lynne of the Northern District of Alabama dated November 8, 1967, which enjoined the enforcement and effectiveness of the ICC's cease and desist order. Appellant's counsel are frank to state that "* * * research has revealed no federal and only one state-court case which has involved or discussed the precise point here — that is, the nullification by one district court through injunctive relief of an order restraining the enforcement of an administrative decision pending its review."

An analysis of the 1965 amendment and its purposes and objectives would seem to be called for. 49 U.S.C.A. § 322(a), (b) as it existed prior to the 1965 amendment limited enforcement actions to the Commission itself or its duly authorized agent who could apply to the District Court of the United States for any...