Cumberland Telephone & Telegraph Co. v. Louisiana Public Service Commission

• Decision Date: 24 July 1922
• Docket Number: 95.
• Citation: 283 F. 215
• Court: U.S. District Court — Eastern District of Louisiana
• Parties: CUMBERLAND TELEPHONE & TELEGRAPH CO. v. LOUISIANA PUBLIC SERVICE COMMISSION et al.

283 F. 215

CUMBERLAND TELEPHONE & TELEGRAPH CO. v. LOUISIANA PUBLIC SERVICE COMMISSION et al.

No. 95.

United States District Court, E.D. Louisiana, Baton Rouge Division.

July 24, 1922

Hunt Chipley and E. D. Smith, both of Atlanta, Ga., and J. C Henriques and J. Blanc Monroe, both of New Orleans, La., for plaintiff.

A. C Coco, Atty. Gen., Wylie M. Barrow, Asst. Atty. Gen., Huey P Long, of Shreveport, La., and A. H. Roberts, of Nashville Tenn., for defendants.

Before BRYAN, Circuit Judge, and CLAYTON and FOSTER, District Judges.

BRYAN Circuit Judge.

The plaintiff, Cumberland Telephone & Telegraph Company, by its bill in equity seeks to enjoin an enforcement of the following order entered by the Louisiana Public Service Commission May 13, 1922:

'It is ordered and a rehearing is granted in this case on and from the order of the Railroad Commission of Louisiana of February 26, 1921, and on the rate allowances made in said order, or made in said order of April 1, 1921, or allowed to be collected in said order of April 1, 1921, and pending the final hearing and determination of this case, from and after this date, all rate advances allowed on February 26, 1921, and thereafter, are hereby suspended, and the rates and charges to be made and to be collected by the Cumberland Telephone & Telegraph Company within the state of Louisiana will be such as were in force prior to the 26th day of February, 1921, and at the time this application was filed; and be it further

'Ordered, that the various interested parties be given notice that a final hearing of this matter will be held in the city of New Orleans, beginning on the 27th day of June, 1922, at which time all interested parties will be heard.'

In September, 1920, the plaintiff applied to the commission for an increase in telephone exchange rates over those established by the Postmaster General during federal control. After hearings, and on February 26, 1921, the commission entered an order granting the increased rates prayed for by the plaintiff. April 1, 1921, the commission entered an order somewhat modifying the rates, reopening its proceedings with reference thereto, and providing for the taking of further testimony. Such was the status of plaintiff's application for increased rates when the commission issued its order of May 13, 1922, above set out, granting a rehearing, reinstating the rates put into effect during federal control, and setting the whole matter down for final hearing on June 27, 1922. The plaintiff's property was returned to it by the Postmaster General August 1, 1919.

The bill contains the following averments: That upon its total actual average investment, including both interstate and intrastate exchange and toll business, the plaintiff earned 5.92 per cent. net revenue for the year ending July 31, 1920 and at the rate of 3.03 per cent. per annum during the months of August, September, October, and November, 1920; that for the year 1921 the plaintiff operated under the rates established by the Postmaster General during the months of January and February, and under the increased rates authorized by the commission's order of February 26, 1921, during the remaining 10 months of that year, and earned a net revenue of 7.15 per cent. upon its average investment, including both interstate and intrastate business; that all of plaintiff's telephone exchange business in Louisiana is intrastate, but that its toll business is partly intrastate and partly interstate; that approximately 89 per cent. of plaintiff's total property is used exclusively in intrastate business, and approximately 11 per cent. exclusively in interstate toll business; that the reasonable value of plaintiff's property in Louisiana, devoted to both interstate and intrastate business, as of May 13, 1922, the date of filing the bill, was in excess of $15,000,000; that for the year 1921 the average investment in exchange lines equipment was $7,993,207.60, in toll lines $3,326,013.12, and that plaintiff's total average investment was $12,942,281.61, which included also land, buildings, supplies, and working capital; that for the same year the operating revenues were: From exchange service, $3,540,440.51; from toll service $1,553,853.29; and from miscellaneous sources $77,668.33-- a total of $5,171,962.13; that the total operating costs were $4,246,635.08, and the net revenue $924,327.85; that the rates are confiscatory, and, if enforced, would deprive plaintiff of its property without due...