Erickson Transport Corp. v. I.C.C., 83-1011
| Decision Date | 27 February 1984 |
| Docket Number | No. 83-1011,83-1011 |
| Citation | 728 F.2d 1057 |
| Parties | ERICKSON TRANSPORT CORPORATION, Petitioner, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents. |
| Court | U.S. Court of Appeals — Eighth Circuit |
John E. Jandera, Jandera, Gregg & Barker, Topeka, Kan., for Erickson Transport Corp.
William F. Baxter, Asst. Atty. Gen., Robert B. Nicholson, Marion Jetton, Attys., Appellate Sec., Antitrust Div., Dept. of Justice, John Broadley, Gen. Counsel, Ellen D. Hanson, Associate Gen. Counsel, Edward J. O'Meara, Atty., I.C.C., Washington, D.C., for respondents.
Before HEANEY, Circuit Judge, FLOYD R. GIBSON, Senior Circuit Judge and JOHN R. GIBSON, Circuit Judge.
Erickson Transport Corporation petitions for review of an order by the Interstate Commerce Commission granting motor carrier operating authority to Stewco, Inc. We affirm the Commission's decision.
On May 10, 1982, pursuant to 49 C.F.R. Secs. 1100.251-.253 (1981), Stewco, Inc., a Texas Corporation, filed an application with the Interstate Commerce Commission (ICC) for an extension of motor carrier operating authority. The application was considered under the modified procedure. 1 Stewco requested authority to transport liquid commodities, in bulk, between two Arkansas counties, on the one hand, and all points in the continental United States on the other hand.
The application was accompanied by a verified statement from Stewco's president. The statement included: an acknowledgment of Stewco's existent interstate authority for other commodities; a description of Stewco's facilities in Arkansas; a description of the services the company intended to offer the supporting shipper; a detailed list of Stewco's available equipment; and an assertion that the grant of authority would permit Stewco to eliminate deadhead mileage and its accompanying waste of fuel.
Stewco's application was supported by one shipper, Riceland Foods, Inc., (Riceland). Riceland stated that it had been receiving intrastate service from Stewco, and that a grant of interstate authority would enable Stewco to provide more efficient service. Riceland anticipated tendering approximately ten shipments per week to Stewco. Riceland maintains facilities in the two Arkansas counties from which Stewco requested authority to transport. For representative destinations, Riceland simply named fifteen states surrounding Arkansas. 2 Riceland also documented numerous service problems it had experienced with motor carriers, none of which involved the petitioner in this case.
Written protest to Stewco's application was filed by four trucking companies, only one of whom, Erickson Transport Corporation, appealed to this court. 3 Prior to Stewco's application, Erickson had been providing interstate service to Riceland since 1980. Erickson had invested a significant amount of money in order to provide service to Riceland and, in turn, Erickson drew a significant amount of its revenue from this service. In the protest statement submitted to the ICC, Erickson acknowledged that it handled approximately 95% of Riceland's interstate shipping business. Riceland had previously supported Erickson's petition to the ICC for interstate authority. Erickson's business with Riceland had enabled Erickson to reduce its deadhead mileage and expenses. Before the review board, and on appeal to this court, Erickson asserted that granting Stewco's application would divert traffic from Erickson which, in turn, would result ultimately in a loss of revenue, wasted fuel, unemployment, rate increases and a disruption in the flow of commercial traffic.
On September 17, 1982, an ICC review board approved a partial grant of the application, extending Stewco's authority to the fifteen states named by Riceland in its statement of support, rather than to all points in the continental United States as Stewco had requested. In its decision, the review board found that Stewco had proved there was a need for its service by submitting Riceland's supporting statement. The board noted that, while the evidence was less specific than might be desired, it was sufficient to establish a need between the Arkansas counties and the states named in Riceland's statement. The board held Erickson had failed to establish that granting the authority to Stewco was inconsistent with the public convenience and necessity.
Specifically, the board found: Stewco's service would serve a useful public purpose, responsive to a public demand or need; Stewco was fit, willing and able to perform the service and; granting the application would not affect either the quality of the human environment or the conservation of energy resources. Erickson entered an appeal from the review board's opinion. The appeal was denied and a final order granting Stewco interstate authority was rendered. Erickson petitions for judicial review of the Commissioner's decision. Because this is the first time this Circuit has reviewed the new guidelines for licensure under the 1980 Motor Carrier Act, we consider the petitioner's arguments in detail.
Until 1980, entry into the trucking industry was governed by the Motor Carrier Act of 1935. 4 The guidelines for licensure of motor carriers under the 1935 Act were, in pertinent part, as follows:
(a) ... the Interstate Commerce Commission shall issue a certificate to a person authorizing that person to provide transportation ... as a motor common carrier or water common carrier, respectively, if the Commission finds that--
(1) the person is fit, willing and able--
(A) to provide the transportation to be authorized by the certificate; and
(B) to comply with this subtitle and regulations of the Commission; and
(2) the transportation to be provided under the certificate is or will be required by the present or future public convenience and necessity.
49 U.S.C. Sec. 10922(a) (Supp. II 1978).
The Motor Act of 1980 effected a radical change in the 1935 Act. By adding a new paragraph to the law, Congress changed the entire thrust of the public policy behind motor carrier regulation. The law now provides, in pertinent part:
It is the policy of the United States government ...
....
... (7) with respect to transportation of property by motor carrier, to promote competitive and efficient transportation services ....
49 U.S.C. Sec. 10101(a)(7) (Supp. V 1981) (emphasis added). To this end, Congress also amended the guidelines for licensure. In addition to the requirements of the 1935 Act, noted above, the 1980 Act also provides:
(b)(1) ... the Interstate Commerce Commission shall issue a certificate to a person authorizing that person to provide transportation ... as a motor common carrier of property if the Commission finds--
(A) that the person is fit, willing and able to provide the transportation to be authorized by the certificate and to comply with this subtitle and regulations of the Commission; and
(B) on the basis of evidence presented by persons supporting the issuance of the certificate, that the service proposed will serve a useful public purpose, responsive to a public demand or need; unless the Commission finds, on the basis of evidence presented by persons objecting to the issuance of a certificate, that the transportation to be authorized by the certificate is inconsistent with the public convenience and necessity.
(2) In making a finding under paragraph (1) of this subsection, the Commission shall consider and, to the extent applicable, make findings on at least the following:
(A) the transportation policy of section 10101(a) of this title; and
(B) the effect of issuance of the certificate on existing carriers, except that the Commission shall not find diversion of revenue or traffic from an existing carrier to be in and of itself inconsistent with the public convenience and necessity.
49 U.S.C. Sec. 10922(a)-(b)(1) & (2) (Supp. V 1981).
If these amendments, by themselves, do not reflect clearly the Congressional intent behind the changes, the intent is made crystal clear in the Act's legislative history. Congress intended to remove the protective shield which served to shelter existing motor carriers from competition, and open up the industry to competition in order to better serve the public. H.R.Rep. No. 1069, 96th Cong., 2d Sess. 3, 12, 14, reprinted in 1980 U.S.Code Cong. & Ad.News 2283, 2285, 2294, 2295.
In the House Report, the Committee on Public Works and Transportation noted the policy behind licensure under the 1935 Act:
[t]he Motor Carrier Act of 1935 adopted a regulatory scheme of limited entry into the business of transportation by motor vehicle "on the premise that the public interest in maintaining a stable transportation industry so required."
Id. at 12, reprinted in 1980 U.S.Code Cong. & Ad.News, 2294, quoting United States v. Drum, 368 U.S. 370, 373-74, 82 S.Ct. 408, 409-10, 7 L.Ed.2d 360 (1962). To this end, the ICC had defined the statutory standard of public convenience and necessity which an applicant for motor carriage would have had to meet, as follows:
whether the new operation or service will serve a useful public purpose, responsive to a public demand or need; whether this purpose can and will be served as well by existing lines or carriers; and whether it can be served by applicant with the new operation or service proposed without endangering or impairing the operations of existing carriers contrary to the public interest.
Id. at 13, reprinted in 1980 U.S.Code Cong. & Ad.News 2295, quoting Pan-American Bus Lines Operations, 1 M.C.C. 190, 203 (1936).
The legislative history of the 1980 Act reveals that it was to stand in stark contrast to the 1935 Act:
the Committee clearly rejects the historic approach of the Commission toward applications for authority to operate as motor common carriers of property. [The amendment] reflects the Committee's strong belief that increased competition and...
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