Black v. I.C.C.
| Decision Date | 21 May 1985 |
| Docket Number | No. 83-2327,83-2327 |
| Citation | 246 U.S.App.D.C. 12,762 F.2d 106 |
| Parties | 119 L.R.R.M. (BNA) 2742, 246 U.S.App.D.C. 12 Jack O. BLACK, Petitioner, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
Gordon P. MacDougall, Washington, D.C., for petitioner.
Charles A. Stark, Atty. I.C.C., Washington D.C., with whom J. Paul McGrath, Asst. Atty. Gen., Dept. of Justice, John Broadley, Gen. Counsel, and Ellen D. Hanson, Associate Gen. Counsel, I.C.C., and Barry Grossman and Nancy C. Garrison, Attys., Dept. of Justice, Washington, D.C., were on the joint brief, for respondents. Robert S. Burk, Acting Gen. Counsel, and Henri F. Rush, Acting Deputy Gen. Counsel, I.C.C., Washington, D.C., were also on the supplemental brief for respondent, I.C.C.
Richard A. Allen, Washington, D.C., for intervenor, Indiana Hi-Rail Corp.
Before EDWARDS and BORK, Circuit Judges, and OBERDORFER, * District Judge.
Opinion for the Court filed by District Judge OBERDORFER.
This is a petition to review a decision of the Interstate Commerce Commission exempting the Indiana Hi-Rail Corporation ("IHR") 1 from all requirements of the Interstate Commerce Act with respect to IHR's acquisition and operation of a 22.21 mile railroad line between New Castle and Rushville, Indiana (the "Rushville line"). Indiana Hi-Rail Corporation--Exemption from 49 U.S.C. Subtitle IV--Operations between New Castle and Rushville, IN, Finance Docket No. 30169 (July 11, 1983). The Rushville line had previously been owned and operated by Norfolk and Western Railway Company ("N & W"). In addition to granting the general exemption, the decision further announced that the Commission would not impose any employee protective conditions on IHR with respect to IHR's takeover and operation of the line.
Petitioner, Jack O. Black, Indiana Legislative Director of the United Transportation Union ("UTU"), challenges various aspects of the Commission's decision. First, petitioner argues that IHR's takeover of the railway line was a "consolidation," "merger," or "acquisition of control" pursuant to 49 U.S.C. Sec. 11343 (1982). In such transactions, the imposition of employee protective conditions is mandatory under 49 U.S.C. Sec. 11347 (1982). Second, petitioner contends that the Commission's further decision to grant IHR a general exemption from Commission regulation under the Interstate Commerce Act was arbitrary and capricious. Finally, UTU argues that during the proceedings before the Commission, the Commission improperly treated a petition for reconsideration filed by UTU as subject to the criteria for "revocation" of For the reasons stated below, the Commission's determination that the imposition of employee protective conditions was not mandatory is affirmed. The Commission's discretionary refusal to impose such conditions on IHR, and its grant to IHR of a general exemption from Commission regulation, are similarly affirmed. Finally, even if the Commission erred in its characterization of UTU's petition for reconsideration, it does not appear in this case that any "substantial rights" of UTU were thereby affected. 28 U.S.C. Sec. 2111 (1982).
an exemption under 49 U.S.C. Sec. 10505(d) (1982), and thereby incorrectly placed the burden of proof as to that petition on UTU.
The Rushville line has already been the object of considerable agency and judicial attention. In December of 1977, N & W applied to the Commission for authority to abandon the line pursuant to 49 U.S.C. Sec. 10903 (1982), 2 even though the line had been a profitable one serving several shippers. See J.A. 2. After an initial denial by an administrative law judge, the Commission approved the abandonment in 1980. Norfolk & W. Ry. Co.--Abandonment, 363 I.C.C. 115 (1980). Subsequently, the United States Court of Appeals for the Seventh Circuit set aside the approval and remanded the case to the Commission. International Minerals & Chemical Corp. v. Interstate Commerce Commission, 656 F.2d 251 (7th Cir.1981). On remand, the Commission--in a decision served on November 4, 1982--again approved N & W's application for abandonment of the Rushville line. Norfolk and Western Railway Company--Abandonment between New Castle and Rushville, in Henry and Rush Counties, Indiana, Docket No. AB-10 (Sub-No. 11) (Nov. 4, 1982).
In the meantime, IHR, an entity first organized in 1980, 3 had acquired from Conrail a six-mile railroad line between Beesons and Connersville, Indiana (the "Connersville line"), J.A. 3, within the same general region as the Rushville line. See Joint Brief for the Interstate Commerce Commission and the United States of America at 12a () [hereinafter cited as "Respondents' Brief" ]. IHR's authority to acquire the Connersville line was granted by the Commission on November 16, 1981, under 49 U.S.C. Sec. 10910 (1982), the Staggers Rail Act "feeder line" development program. Indiana Hi-Rail Corp.--Feeder Line Acquisition, 366 I.C.C. 42 (1981). 4 At the time of acquisition, IHR elected to invoke an aspect of the feeder line development legislation that allowed it--as a participant in the feeder development program--to take a full exemption from all of the provisions of Title 49 () with respect to its operation of the Connersville line, see At the same time that IHR was acquiring the Connersville line, it also revealed a strong interest in acquiring the Rushville line as well. In the Commission proceedings on IHR's application to acquire the Connersville line, indeed, IHR actually announced that it had "negotiated an agreement with N & W to acquire" the Rushville line. Indiana Hi-Rail Corp.--Feeder Line Acquisition, supra, 366 I.C.C. at 46. It appears that in fact no final sale was actually consummated, but contacts between N & W and IHR continued. When the Commission subsequently considered the Rushville line abandonment application on remand from the Seventh Circuit Court of Appeals, IHR intervened and filed a brief urging that the Commission's processing of the application be expedited. 6 Then, soon after the Commission's November 4, 1982 re-approval of N & W's abandonment application, IHR--on November 12, 1982--made an offer to purchase the Rushville line pursuant to 49 U.S.C. Sec. 10905(c) (1982). See Petitioner's Brief at 14a. 7 When it then appeared that N & W and IHR would be unable to agree on a purchase price, they requested that the Commission establish a price for the line pursuant to 49 U.S.C. 10905(e). Id. The Commission complied, announcing a price on February 11, 1983. IHR, however, rejected even the Commission's suggested price, and on February 18, 1983, IHR formally withdrew its Sec. 10905(c) offer to purchase the line. Id.
Sec. 10910(g)(1). 5 J.A. 3. IHR continues to operate the Connersville line as a feeder line effectively exempt from ICC regulation. See J.A. 3
Upon the withdrawal of IHR's purchase offer, the Commission returned to its handling of the Rushville line as an abandonment matter. 8 On March 3, 1983, the Commission issued to N & W an abandonment certificate with respect to the line. Id. at 14a-15a. 9 N & W gave public notice on April 1, 1983, that it would cease service on the Rushville line effective April 12, 1983. See Petitioner's Brief at 6; Respondent's Brief at 36 n. 25, 14a-16a. On April 12, 1983, N & W in fact cancelled its tariffs and claims to have ceased service on the Rushville line. J.A. 3, 30. On April 20 Yet while N & W was thus terminating its operations on the Rushville line, public negotiations to sell the line to IHR resumed. Respondents and intervenor assert that on April 8, 1983--the eve of the cessation of service--N & W notified IHR of its willingness to sell the Rushville line on new terms and also to lease the line to IHR pending consummation of the sale. J.A. 3, 5, 9. Almost immediately, IHR and N & W made public an agreement on the sale of the line, id., and IHR executed a lease with N & W on April 12, 1983, J.A. 41--the same day on which N & W ceased service on the line. On the following day, IHR applied to the Commission for a temporary exemption from ICC regulations so as to enable IHR to operate the line under lease pending consideration by the Commission of a petition for a permanent exemption with respect to IHR's operation of the line after the sale was consummated. J.A. 1-7.
1983, N & W filed a letter with the Commission stating that on April 12, 1983, it had "discontinued" service on the line. J.A. 26, 40.
On April 15, 1983, the ICC rendered a decision that granted the temporary exemption, and that allowed IHR to operate the line during the period of the lease without having to provide any employee protections in doing so. J.A. 8-11. Simultaneously, IHR filed tariffs, which became effective on April 20, 1983, with respect to its prospective operations on the Rushville line. The Commission represents--without contradiction by petitioner--that IHR's operations on the line commenced on April 20, 1983. See Respondents' Brief at 36-37 & n. 26, Addendum E.
Soon thereafter, on July 11, 1983, the ICC also granted IHR's petition for a permanent exemption, effective August 11, 1983. J.A. 54-60. Paralleling the pattern of the temporary exemption decision, the permanent exemption decision also imposed no labor protection requirements on IHR with respect to its operation of the line. J.A. 58-59.
The Commission's July 11, 1983 decision stated that "petitions for reconsideration must be filed by August 1, 1983." J.A. 59, 60. UTU filed such a petition with the Commission on August 1, 1983. J.A. 84. In the Commission's ruling on the petition, however, it announced that it would consider the petition according to the standard for "revocation" of an exemption, set out in 49 U.S.C. Sec. 10505(d) (1982). J.A. 84-85. The ruling, served on October...
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