Crain v. Blue Grass Stockyards Company
Decision Date | 22 August 1968 |
Docket Number | No. 17998.,17998. |
Parties | Morris CRAIN, Plaintiff-Appellant, v. BLUE GRASS STOCKYARDS COMPANY and Clay-Wachs Stockyards, Inc., Defendants-Appellees. |
Court | U.S. Court of Appeals — Sixth Circuit |
James R. Odell, Lexington, Ky., for plaintiff-appellant; Pat D. Rankin, Stanford, Ky., on brief.
Gladney Harville, Lexington, Ky., for defendants-appellees; Stoll, Keenon & Park, Herbert D. Sledd and Brown, Sledd & McCann, Lexington, Ky., on brief.
Before WEICK, Chief Judge, and PHILLIPS and EDWARDS, Circuit Judges.
This appeal is from an order of the District Court granting the defendants' motions to dismiss the complaint on the ground that the controversy was within the primary jurisdiction of the Secretary of Agriculture.
Plaintiff's action in the District Court was for damages and injunctive relief alleging violations by defendants of sections 1 and 2 of the Sherman Act, section 15 of the Clayton Act and of various provisions of the Packers and Stockyards Act of 1921, 15 U.S.C. §§ 1, 2 and 15, and 7 U.S.C. § 181 et seq., respectively.
The complaint alleged substantially the following: That plaintiff is a livestock dealer licensed and bonded under the provisions of the Packers and Stockyards Act of 1921; that he has in the past, and does now, buy, sell and transport livestock in behalf of others and on his own account; that the defendants-stockyards are subject to the provisions of said Act and are the only stockyards in Lexington, Kentucky; that they account for a substantial amount of the livestock traded in central Kentucky; that for several years plaintiff utilized the defendants' facilities in connection with receiving, buying and selling livestock in commerce, but on and since September 15, 1965, the defendants have refused, without just cause, to permit plaintiff to use the facilities and services of their stockyards. Such conduct of the defendants was alleged to be in combination and conspiracy with each other, for the purpose of excluding plaintiff from the Lexington market thereby attempting to monopolize the market and restrain trade. Plaintiff further alleged that the defendants' actions were a violation of their duty to provide reasonable stockyard services without discrimination. As a result of the above conduct plaintiff alleged that he has suffered substantial monetary loss.
Answers were filed by the defendants asserting lack of jurisdiction of the Court over the subject matter and further alleging that they had the lawful obligation to and did establish and enforce reasonable rules and regulations for the orderly and successful operation of their stockyards; that plaintiff wilfully refused to comply with such rules and regulations although repeatedly requested to do so; that such refusal was the sole reason for the denial to him of the services and facilities of the stockyards.
Defendants filed motions to dismiss which the District Judge granted on the sole ground that primary jurisdiction for the determination of the controversy lies with the Secretary of Agriculture. This appeal followed.
The relevant provisions of the Packers and Stockyards Act of 1921 are sections 205, 208 and 209. Section 205 provides in part:
"It shall be the duty of every stockyard owner and market agency to furnish upon reasonable request, without discrimination, reasonable stockyard services at such stockyard: * * *."
Section 208 provides in part:
"It shall be the duty of every stockyard owner * * * to establish, observe and enforce just, reasonable, and nondiscriminatory regulations and practices in respect to the furnishing of stockyard services, * * *."
Section 209 provides:
Plaintiff's claims for antitrust and stockyard Act violations are based on statutory remedies and hence come within the purview of section 209(b) (2). However, despite the choice of remedies provided by section 209(b) (2), there are instances in which the courts, because of the nature of the questions involved, will require that the litigants first seek relief before the Secretary. This has become known in the case law as the doctrine of primary jurisdiction.
The doctrine of primary jurisdiction traces its origin to Texas & Pac. Ry. v. Abilene Cotton Oil Co., 204 U.S. 426, 27 S.Ct. 350, 51 L.Ed. 553 (1907)1. There the oil company sued for the return of transportation charges paid to the defendant-carrier which were alleged to be discriminatory and in excess of a reasonable rate. The court prefaced its opinion by recognizing that the action was one which could have been maintained at common law. The court also recognized that the Act (Interstate Commerce Act) purported to provide remedies in addition to pre-existing ones. However, the court also noted that one of the primary purposes of the Act was to establish uniform rates which would not discriminate between shippers, and since to permit a court to pass on the reasonableness of a rate prior to action by the Commission might destroy the very uniformity the Act sought to achieve, the court held that where a rate is attacked as unreasonable the first resort must be to the administrative agency rather than the courts.
The doctrine was elaborated upon and somewhat expanded in the subsequent case of Great Northern Ry. v. Merchants Elev. Co., 259 U.S. 285, 42 S.Ct. 477, 66 L.Ed. 943 (1922). That case involved an action by a shipper to recover reconsignment charges which it had paid the defendant-carrier. Resolution of the matter hinged on the interpretation to be given a tariff, i.e., whether the facts came within the rule of the tariff or within one of the exceptions. The court held that where the facts are largely undisputed and the only question presented is one of construction of a tariff, that is a question of law and may be decided by the courts without prior referral to the administrative agency. In explaining why a question of the reasonableness of a rate, rule or practice must first be referred to the Commission, in contradistinction to construction of a tariff, the court said, at page 291, 42 S.Ct. at page 479:
The court further held that where words of a tariff are alleged to have other than their ordinary meaning a factual determination by the Commission must precede the court's interpretation. In accord with this holding are Texas & Pac. Ry. v. American Tie & Timber Co., 234 U.S. 138, 34 S.Ct. 885, 58 L.Ed. 1255 (1914) ( ) and Loomis v. Lehigh Valley R.R., 240 U.S. 43, 36 S.Ct. 228, 60 L.Ed. 517 (1916) ( ).
A more recent decision dealing with primary jurisdiction is United States v. Western Pac. R.R., 352 U.S. 59, 77 S.Ct. 161, 1 L.Ed.2d 126 (1956). There the government had shipped some napalm gel bombs which were not equipped with a burster and fuse. There was at the time a tariff in force which provided for a certain rate for "incendiary bombs". In addition to claiming that the absence of the burster and fuse prevented the shells from being "incendiary bombs", the government contended that if the tariff was intended to apply to these shipments it was unreasonable. The court said, at pages 63-64, 77 S.Ct. at page 165:
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