Berwind-White Coal Mining Co. v. United States

• Decision Date: 25 November 1925
• Docket Number: No. 3271,3285,3275,3317.,3273,3271
• Citation: 9 F.2d 429
• Parties: BERWIND-WHITE COAL-MINING CO. et al. v. UNITED STATES, and four other cases.
• Court: U.S. District Court — Western District of Pennsylvania

9 F.2d 429 (1925)

BERWIND-WHITE COAL-MINING CO. et al. v. UNITED STATES, and four other cases.

Nos. 3271, 3273, 3275, 3285, 3317.

District Court, E. D. Pennsylvania.

November 25, 1925.

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John Hampton Barnes, of Philadelphia, Pa., August G. Gutheim, of Washington, D. C., Charles Heebner, of Philadelphia, Pa., and Walker D. Hines and Wayne Johnson, both of New York City, for Berwind-White Coal-Mining Co. and others.

Frederic L. Ballard, of Philadelphia, Pa., Frederick H. Wood, H. A. Moore, Paul D. Cravath, and Charles S. Belsterling, all of New York City, Richard V. Lindabury, of Newark, N. J., and Charles MacVeagh, of New York City, for Bethlehem Steel Co. and others.

John Lord O'Brian, of Buffalo, N. Y., and Ralph J. Baker, of Harrisburg, Pa., for Rainey-Wood Coke Co. and others.

F. M. Rivinus and Henry Wolf Bikle, both of Philadelphia, Pa., W. S. Bronson, of Richmond, Va., Francis I. Gowen and W. L. Kinter, both of Philadelphia, Pa., W. A. Northcutt, of Louisville, Ky., C. C. Paulding, of New York City, Theodore W. Reath, of Philadelphia, Pa., and C. M. Sheafe, Jr., of New York City, for Akron, C. & Y. Ry. Co. and others.

Frank Bergen, of Newark, N. J., Henry S. Drinker, Jr., of Philadelphia, Pa., William H. Speer, of Newark, N. J., and August G. Gutheim and James W. Carmalt, both of Washington, D. C., for Public Service Electric & Gas Co.

Blackburn Esterline, Asst. Sol. Gen., of Washington, D. C., and George W. Coles, U. S. Atty., of Philadelphia, Pa., for the United States.

R. Granville Curry, of Washington, D. C., for Interstate Commerce Commission.

Greever & Gillespie, of Tazewell, Va., and A. M. Liveright, of Clearfield, Pa., for intervening defendants.

Before WOOLLEY, Circuit Judge, and THOMPSON and THOMSON, District Judges.

THOMPSON, District Judge.

These suits were brought for the purpose of enjoining, setting aside, and annulling an order of the Interstate Commerce Commission relating to the distribution of coal cars among bituminous coal mines in times of car shortage. On March 22, 1921, the Commission instituted an investigation, upon its own motion, into and concerning the reasonableness and propriety of the then existing car distribution rules, in so far as they apply to privately owned coal cars and cars furnished for railroad fuel coal, with a view to prescribing such just and reasonable rule or regulation as might appear to be necessary. All of the railroads subject to the jurisdiction of the Commission were made parties respondent to the proceeding. The car distribution rule under investigation is what has been known as the "assigned car rule."

The cars for loading with bituminous coal involved in the investigation and in the order in controversy are "system cars," or cars of railroad ownership set for loading at mines upon the line of the owning carrier, or such as may be on its line of railroad and not owned by some specific shipper or restricted as to use, and "assigned cars." The latter are classified as described in the "assigned car rule," which has been practiced generally by the railroads during periods of coal car shortage since 1907, as follows:

(A) Assigned cars are of three classes: (1) System fuel cars; that is, cars assigned to mines on a coal-loading railroad for the fuel coal of that railroad. (2) Foreign fuel cars; that is, cars of another railroad assigned to mines on a coal-loading railroad for the fuel of the former. (3) Private cars; i. e., cars not railroad owned, assigned for the coal of the owner of the cars to its own or other mines.

(B) All assigned cars must be placed at the mines to which they are assigned.

(C) If the number of cars equals or exceeds the number of cars to which the mine is that day entitled under the prevailing rate of system car distribution, the mine is not entitled to any system cars for loading that day.

(D) If the number of assigned cars does not equal the number of cars to which the mine is that day entitled under the prevailing rate of system car distribution, the mine is allowed sufficient system cars in addition to bring its total placement that day up to the distributive share to which it is entitled.

On June 13, 1923, the Commission, after conducting hearings and taking testimony, issued its report and entered the following order:

"It is ordered, that each of the respondents be, and each is hereby, notified and required to cease and desist, on or before September 1, 1923, and thereafter to abstain, from maintaining and enforcing, in so far as such respondent maintains and enforces, a regulation or practice whereby in the distribution of cars for the transportation of coal among the bituminous coal mines served by such respondent, whether located upon its line or customarily dependent upon it for car supply, private cars or cars for the loading of bituminous coal for railway fuel are placed at any such mine in excess of the pro rata allotment and distribution of cars for coal loading currently made to any other of such mines which do not receive private cars or cars for railway fuel and which are on the same division or district established by such respondent for the distribution of cars.

"It is further ordered, that each of the respondents which distributes cars to bituminous coal mines located upon its line or customarily dependent upon it for car supply be, and each is hereby, notified and required to establish on or before September 1, 1923, and thereafter to maintain and enforce a regulation and practice whereby all cars distributed by such respondent to such mines must be distributed on a pro rata basis, and if cars are assigned or consigned to any of such mines and if such cars are placed at the mines to which assigned or consigned, they must be so placed that every mine on the same division or district established by respondent for the distribution of cars shall receive the same pro rata share of the total number of available cars, whether assigned, consigned, or unassigned, which are distributed to all mines on such division or district, and that all such assigned or consigned cars must be counted and charged against the mines at which they are placed in the same manner and to the same extent that unassigned cars are counted and charged."

For report, see 80 Interst. Com. Com'n R. 520.

Thereafter, upon petition of railroads and owners of private coal cars, the Commission on October 5, 1923, reopened the proceeding and held further hearings, and on September 23, 1924, issued its further report and order affirming the order previously made (93 Interst. Com. Com'n R. 701); the effective date of the order meanwhile having been extended from time to time to March 1, 1925.

Prior to 1907, the practice in the distribution of coal cars among the mines upon the lines of the railroads, in times of car shortage, was to establish a pro rata distribution of the available system coal cars among the mines in proportion to the rated daily output capacity of the mines. Thus, if the available supply of system cars for delivery to the mines was 1,000 and the total daily output capacity of the mines in the district affected by car shortage was 2,000 carloads, each mine would receive 50 per cent. of the system cars available, so that, if the daily rating of a mine was 100 carloads, it would receive but 50 system cars. The practice, with some exceptions, however, was not to count against the mine's share railroad fuel cars or private cars assigned to that mine, but they were placed at the mines to which assigned in as great numbers as the facilities of the railroad would permit, and mines loading railroad fuel coal or coal for private car owners received an equal pro rata share of system cars with all other mines.

That practice resulted in complaints before the Commission in the cases of Railroad Commission of Ohio et al. v. Hocking Valley Railroad Co., and Same v. Wheeling & Lake Erie Railroad Co., 12 Interst. Com. Com'n R. 398. Those cases involved the practice of the carriers in not counting foreign railroad fuel cars and private cars against the mines to which assigned. The Commission held the practice discriminatory and ordered its discontinuance. In the case of Traer v. Chicago & Alton Railroad Co., 13 Interst. Com. Com'n R. 451, the Commission, following the Hocking Valley decision, held that cars used by railroads upon their own lines for their own necessary fuel supply may be given in any numbers to the mine or mines from which such fuel supply is received, but that the failure to count such fuel cars against the mine or mines was discriminatory and that practice was ordered abolished. The orders upon appeal were held by the Supreme Court, in Interstate Commerce Commission v. Illinois Central Railroad Co., 215 U. S. 452, 30 S. Ct. 155, 54 L. Ed. 280, to be within the power conferred upon the Commission to control the use of the equipment of the railroads in order to prevent discrimination against or undue preference of miners and shippers of coal in the distribution of coal cars in time of car shortage. The rule laid down by the Commission in those cases has come to be known as the "Hocking Valley-Traer rule," and was adhered to by the Commission and practiced by the railroads until the time of federal control, when a rule substantially similar in effect was adopted with the power of assignment in the Car Service Section of the Railroad Administration, and, after the termination of federal control, the Commission continued in effect the Hocking Valley-Traer rule.

Suit No. 3285 is brought by 35 railroad companies, common carriers by railroad, engaged in interstate commerce, and subject, under the Act to Regulate Commerce, to the orders of the Commission. They are dependent upon steady continuous supply of bituminous coal of suitable quality and in sufficient quantity for the operation of their locomotives and conducting their business as common carriers. About 28 per cent. of the total...