Chieppo Bus Company v. United States
| Decision Date | 05 November 1974 |
| Docket Number | Civ. No. 15740. |
| Citation | 383 F. Supp. 1192 |
| Court | U.S. District Court — District of Connecticut |
| Parties | The CHIEPPO BUS COMPANY, Plaintiff, v. The UNITED STATES of America and the Interstate Commerce Commission, Defendants, and Greyhound Lines, Inc. (East), and the Arrow Line, Inc., Intervening Defendants, and National Bus Traffic Association, Inc., Intervening Defendant. |
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Walter W. Walsh, New Haven, Conn., Mary E. Kelley, Medford, Mass., and Harold P. Boss, Washington, D. C., for plaintiff.
Thomas E. Kauper, Asst. Atty. Gen., Antitrust Div., Dept. of Justice, John H. D. Wigger, Atty., Dept. of Justice, Washington, D. C., Peter C. Dorsey, U. S. Atty., D.Conn., Peter Mear, Asst. U. S. Atty., Fritz R. Kahn, Gen. Counsel, Interstate Commerce Commission, and Seymour Glanzer, Atty., ICC, Washington, D. C., for defendants.
William E. Glynn, Day, Berry & Howard, Hartford, Conn., and Drew L. Carraway, Rice, Carpenter & Carraway, Washington, D. C., for intervening defendant National Bus Traffic Ass'n, Inc.
William E. Glynn, Day, Berry & Howard, Hartford, Conn., and L. C. Major, Jr., Major, Sage & King, Alexandria, Va., for intervening defendants Greyhound Lines, Inc. (East) and The Arrow Line, Inc.
Before SMITH, Circuit Judge, and BLUMENFELD and NEWMAN, District Judges.
The Chieppo Bus Company (Chieppo) invokes the jurisdiction of this three-judge court under 28 U.S.C. § 2325 to set aside, insofar as adverse to Chieppo, the action taken by the Interstate Commerce Commission (ICC) on Chieppo's alternative petitions for modification of an existing certificate of operations and issuance of a supplemental one. 117 M. C.C. 358 (1972). We find substantial evidence to support the Commission's decision to deny modification and to grant operational authority by a new certificate more circumscribed than requested and we dismiss the action to set aside the orders.
Chieppo operates a bus line out of Connecticut to ten Northeastern states and the District of Columbia under a special operations certificate issued by the ICC in 1947.1 The service contemplated by this certificate is basically the carriage of passengers and their baggage on round-trip tours. To be distinguished are certificates for charter service — rental of the vehicle's use to a group already organized — and regular route authority — transportation of passengers and baggage at scheduled times over fixed routes between carrier-maintained terminal facilities. Since 1963, Chieppo has taken horse-racing fans from Connecticut to various tracks located outside the state; the buses leave Connecticut and return to the state on the same day. The petitions now under review constitute an attempt by Chieppo to legitimize the continuation and proliferation of its track operations2 as conforming to (1) the terms of the 1947 certificate, or (2) a requested supplemental certificate drawn to enforce the original intent of the Commission in awarding the 1947 certificate.
The Commission rejected Chieppo's construction of the 1947 certificate but did authorize certain of its trips by a new certificate. On appeal, Chieppo challenges both holdings, the first in full and the second insofar as it fails to grant it the entire authority requested. With regard to the former, Chieppo principally differs with the Commission's application of an appropriate legal standard. Secondarily, it alleges: that a denial of its due process right to "fair warning" inheres in the application of this general standard not set forth in concrete form by rule-making; that this standard's application necessarily involves activity outside the ICC's jurisdiction; and that the Commission failed to justify its resolution of the standard's applicability with findings and conclusions in sufficient detail to satisfy the Administrative Procedure Act. Chieppo predicates its attack on the ICC's circumscribed grant of authority pursuant to the second petition on an intent-enforcing theory.
In construing a special operations certificate, the ICC is sensitive to potential encroachments by a special operations carrier on the business of regular route carriers.3 The latter must meet Commission requirements regarding schedules and terminal maintenance that force operating expenses above those of special operations carriers in general. Accordingly, the Commission readjusts the competitive balance between the two types of carriers by in effect awarding, and guarding jealously, a monopoly to the regular route carriers for expeditious travel on their assigned routes.
Difficulties arise when a special operations carrier offers services sharing features of expeditious and tour travel. Chieppo's racetrack operations fall into this gray area: on the one hand, the buses take speedy, non-stop routes with no effort to furnish sightseeing opportunities; on the other hand, Chieppo offers additional services including free parking at one of the Connecticut departure points, an optional package deal (including transportation, and track admissions tokens at cost), and box lunches or refreshments (the cost of which is added into the base fare). In dealing with similarly ambiguous operations by a special certificate holder — specifically, one-day round-trip operations to beaches and racetracks (with an admissions ticket included in the racetrack package) — the ICC laid down the general standard which controls this case: The special operations carrier must provide "something substantial in addition to, or different from, bare expeditious transportation between two points." Asbury Park-New York Transit Corp. v. Bingler Vacation Tours, Inc., 62 M.C.C. 731, 745 (1954). A three-judge district court approved this substantiality test, Bingler Vacation Tours, Inc. v. United States, 132 F.Supp. 793 (D.N.J.), aff'd mem., 350 U.S. 921, 76 S.Ct. 211, 100 L.Ed. 806 (1955). The Commission has decided on a case-by-case basis whether the requisite "something extra and something substantial," Asbury Park-New York Transit Corp. v. Bingler Vacation Tours, Inc., supra, 62 M.C.C. 731 at 745, in fact exists.
In the case currently under review, the ICC found that Chieppo offered additional services too insubstantial to overcome the expeditious character of its point-to-point service to the racetracks. The Commission emphasized that the Bingler test calls for services "that are not merely provided but also `charged for,'" 117 M.C.C. at 372-73 — an emphasis in keeping with the role of a higher price for tour than expeditious travel in maintaining the competitiveness of regular route carriers. Thus, neither Chieppo's optional package, its occasional provision of admissions passes to the tracks and programs at no charge, nor its limited free parking facilities materially contributes toward the "something extra" required by Bingler. The refreshments and box lunches are more nearly the type of extras contemplated by Bingler. The Commission was not persuaded, however, that the presence of this charged-for service made the tour aspect of the trip predominate.4
In its briefs, Chieppo extensively recites cases in which the ICC found that extras similar to those offered by Chieppo — though in different contexts and combinations — met the Bingler minimum. The Commission addressed at length the relevance of various of these cases with commendable lucidity, 117 M.C.C. at 375-77, and we see no purpose in pursuing further such case-by-case analysis. At best the appellant has proved that the Commission was not compelled by its earlier holdings to deny Chieppo's modification petition in full. This is a far cry, however, from the proof of arbitrariness required before this court will overturn the Commission's considered judgment of the competing factors involved. See, Corn Products Refining Co. v. Federal Trade Commission, 324 U.S. 726, 738-739, 65 S.Ct. 961, 89 L.Ed. 1320 (1945). Although we do not attach a presumption of correctness to the decisions of administrative agencies on questions of law, deference to the experience and expertise of such adjudicatory bodies requires that the agency be given wide latitude in finding the facts and applying to them the appropriate legal standard. National Labor Relations Board v. Marcus Trucking Co., 286 F.2d 583, 590-592 (2d Cir. 1961). Our role is at an end, therefore, when we are satisfied that the Commission has acquitted these factfinding and applying functions in a manner supported by substantial evidence in the record as a whole. Universal Camera Corp. v. National Labor Relations Board, 340 U.S. 474, 488, 71 S. Ct. 456, 95 L.Ed. 456 (1951); 5 U.S.C. § 706.5
We concur in the Commission's holding that Chieppo failed to provide the "something extra and something substantial" needed under Bingler and thus violated its special operations certificate by its racetrack operations.
In a somewhat inscrutable attack, Chieppo appears to allege that the ICC is, as a matter of "fair warning," cf., McBoyle v. United States, 283 U.S. 25, 27, 51 S.Ct. 340, 75 L.Ed. 816 (1931), obligated to elucidate the Bingler standard in greater detail by rulemaking. But an agency may proceed by rule-making or ad hoc adjudication so long as both choices are reasonable, Securities and Exchange Commission v. Chenery Corp., 332 U.S. 194, 202-203, 67 S.Ct. 1575, 1760, 91 L.Ed. 1995 (1947), and the ICC has chosen case-by-case decision in this instance after well-reasoned consideration of the options, Passenger Transportation in Special Operations, 112 M.C.C. 160 (1970). The accumulated case law may substitute for rules, therefore, and Chieppo does not suffer a deprivation of due processs merely because it cannot forecast with certainty the bare minimum in extras needed to satisfy the Commission.
Chieppo also alleges that the ICC cannot, consistent with its jurisdiction, require ...
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