Eastern Oil Transport, Inc. v. United States, No. 74-5-CIV-7.

• Court: United States District Courts. 4th Circuit. Eastern District of North Carolina
• Writing for the Court: PER CURIAM
• Citation: 413 F. Supp. 121
• Parties: EASTERN OIL TRANSPORT, INC., Plaintiff, v. UNITED STATES of America and the Interstate Commerce Commission, Defendants, and Kenan Transport Company et al., Intervening-Defendants.
• Decision Date: 30 April 1976
• Docket Number: No. 74-5-CIV-7.

413 F. Supp. 121

EASTERN OIL TRANSPORT, INC., Plaintiff,
v.
UNITED STATES of America and the Interstate Commerce Commission, Defendants,
and
Kenan Transport Company et al., Intervening-Defendants.

No. 74-5-CIV-7.

United States District Court, E. D. North Carolina, Wilmington Division.

April 30, 1976.

413 F. Supp. 122

COPYRIGHT MATERIAL OMITTED

413 F. Supp. 123

Eugene C. Brooks, III, Durham, N. C., and Chester A. Zyblut, Washington, D. C., for plaintiff

Thomas P. McNamara, U. S. Atty., Raleigh, N. C., for defendant United States of America.

Kenneth G. Caplan, Atty., Interstate Commerce Commission, Washington, D. C., for defendant Interstate Commerce Commission.

Thomas W. Steed, Jr., Allen, Steed & Pullen, Raleigh, N. C., Francis W. McInerny and Richard A. Mehley, MacDonald & McInerny, Washington, D. C., and James R. Ziperski, Milwaukee, Wis., for intervening defendants Kenan Transport Co., Laney Tank Lines, Inc., and Schwerman Trucking Co.

Alton Y. Lennon, Stevens, McGhee, Morgan & Lennon, Wilmington, N. C., and Frank B. Hand, Jr., Berryville, Va., for intervening defendant Infinger Transportation Co.

Before CRAVEN, Circuit Judge, BUTLER, Senior District Judge, and DUPREE, District Judge.

MEMORANDUM DECISION

PER CURIAM:

This is an action by Eastern Oil Transport, Inc. (hereinafter referred to as Eastern Oil) against the United States of America and the Interstate Commerce Commission (hereinafter referred to as the ICC or the Commission) to enjoin and set aside an order of the ICC denying Eastern Oil a certificate of public convenience and necessity to transport certain products in interstate commerce. Jurisdiction is invoked under 28 U.S.C. §§ 1336, 1398, 2284, 2321-2325; 49 U.S.C. §§ 17(9), 305(g), 305(h); and 5 U.S.C. §§ 702-706. A three-judge court was convened, pursuant to the provisions of 28 U.S.C. §§ 2284 and 2325, to hear and determine the proceedings herein.

On January 12, 1972, Eastern Oil filed an application with the ICC seeking a certificate of public convenience and necessity to transport asphalt, asphalt cutback, # 2 fuel oil, # 5 oil and # 6 oil, in bulk, from Wilmington, North Carolina, to points in ten counties in South Carolina, and asphalt products, in bulk, from Savannah, Georgia, to Wilmington, North Carolina. The application was supported by one shipper, American Oil Company (American Oil), and protested by four carriers¹ including intervening defendants, Infinger Transportation Company (Infinger), Schwerman Trucking Company (Schwerman), and Kenan Transport Company (Kenan).²

On April 17, 1972, the ICC entered an order directing that Eastern Oil's application

413 F. Supp. 124

be handled under its "modified procedure", 49 C.F.R. §§ 1100.45-54, whereby all evidence is submitted in the form of written verified statements in lieu of an oral hearing before a Joint Board composed of representatives of each of the states involved in the proposed interstate operations of the applicant carrier. On May 15, 1972, intervening defendant Infinger filed a petition with the Commission specifically requesting that its order of April 17, 1972, be set aside and that the matter be referred to a Joint Board for oral hearing on the ground that conflicting evidence would be presented to the commission. Said motion was followed by a similar request by plaintiff Eastern Oil in the form of a letter, dated August 17, 1972, from plaintiff's counsel to Henry U. Snavely, Deputy Director, Section of Operating Rights, Interstate Commerce Commission. Neither party supported its request "by a specific explanation as to why the evidence to be presented could not reasonably be submitted in the form of affidavits . . ." 49 C.F.R. § 1100.247(d)(4). Mr. Snavely advised plaintiff's counsel by letter, dated August 22, 1972, that plaintiff's request for an oral hearing would be considered and disposed of at the time the case is referred to a Review Board for consideration

Eastern Oil filed its verified statements. Verified statements were then filed by protestants Infinger, Schwerman, and jointly by Kenan and Laney, to which plaintiff filed its rebuttal statement. The verified statement of Kenan and Laney included a request for oral hearing before a Joint Board only in the event Eastern Oil's application was not denied by the Commission. Review Board Number 1, in a Report and Order, dated February 23, 1973, denied Eastern Oil's application in its entirety and denied the various motions for Joint Board referral. The Review Board denied Eastern Oil's application because it found that the applicant had failed to meet its burden of proving that existing service is inadequate, and that a grant of authority to applicant would result in wasteful duplication of existing services and subject substantial traffic now transported by protestants to diversion by applicant.

Plaintiff filed a petition for reconsideration and request for oral hearing to which the protestants replied. By order, dated July 11, 1973, the Commission's Division 1, Acting as an Appellate Division, denied said petition. A subsequent petition by Eastern Oil seeking a determination that the proceeding involved issues of general transportation importance was denied by the Commission, in General Session, on August 20, 1973.

This action presents two issues for decision:

(1) Whether the Commission's assignment of plaintiff's application to the modified procedure docket rather than to...