Ex parte State of Texas et al. No. —

• Decision Date: 12 January 1942
• Citation: 86 L.Ed. 579,62 S.Ct. 418,315 U.S. 8
• Parties: Ex parte STATE OF TEXAS et al. No. —-, Original
• Court: U.S. Supreme Court

315 U.S. 8

62 S.Ct. 418

86 L.Ed. 579

Ex parte STATE OF TEXAS et al.

No. —-, Original.

Argued Dec. 8, 9, 1941.

Decided Jan. 12, 1942.

Mr. James P. Hart, of Austin, Tex., for petitioners.

Mr. Charles L. Black, of Austin, Tex., for intervener, Lone Star Gas Co., by special leave of court.

Messrs. James P. Alexander, John H. Sharp, and Richard Critz, Justices of the Supreme Court of Texas, all of Austin, Tex., pro se.

Mr. Justice FRANKFURTER delivered the opinion of the Court.

This is a motion by the Attorney General and Railroad Commission of the State of Texas for leave to file a petition for a writ of mandamus against the Chief Justice and Associate Justices of the Supreme Court of Texas to bring a judgment of that Court into conformity with the controlling mandate of this Court. The foundation of the motion is the claim that in the proceedings following the remand by this Court to the Texas courts of the litigation in Lone Star Gas Co. v. Texas, 304 U.S. 224, 58 S.Ct. 883, 82 L.Ed. 1304, the Supreme Court of Texas has misconceived the scope of our decision. The history of the litigation must therefore be summarized.

In 1934 the Railroad Commission of Texas brought an action in the District Court of Travis County, under Article 6059 of the Revised Civil Statutes of Texas, to enforce its order of September 13, 1933, fixing the rate to be charged by the Lone Star Gas Company, a Texas corporation operating pipe lines located in Texas and Oklahoma for gas delivered to distributing companies in Texas. The Commission's order treated the Company's properties in both states as an 'integrated' system. In its answer the Company attacked the order under the Commerce and Due Process Clauses. A trial was held before a jury, which found, from the evidence before it, that the Commission's order was 'unreasonable and unjust'. Accordingly, the District Court enjoined enforcement of the order. An appeal to the Court of Civil Appeals followed. That court sustained the Commission in treating the Company as an integrated enterprise and found against the Company upon the issue of confiscation. The burden was put upon the Company 'to show by clear and satisfactory evidence a proper segregation of interstate and intrastate properties and business, and to show the value of the property employed in intrastate business or commerce and the compensation it would receive under the rate complained of upon such valuation. Having failed to make a proper segregation of interstate and intrastate properties, appellee (i.e., the Company) did not adduce the quantum and character of proof necessary to establish the invalidity of the rate as being confiscatory, or unreasonable and unjust.' 86 S.W.2d 484, 502. The Court therefore dissolved the injunction of the District Court and declared the Commission's order to be 'just, reasonable, and valid in every particular.' 86 S.W.2d 484, 506. The Supreme Court of Texas refused a writ of error and the case then came here.

We reversed the judgment of the Court of Civil Appeals, and remanded the cause 'for further proceedings not inconsistent' with the opinion. 304 U.S. 224, 242, 58 S.Ct. 883, 891, 82 L.Ed. 1304. It was held: '(1) The Commission's order did not offend the Commerce Clause. The Commission was entitled to take into consideration the Company's producing properties in Oklahoma and its transmission lines to Texas, because 'the proved manner in which the gas from Okla- homa was treated and handled in Texas made it an integral part of the gas supplied to the Texas communities in appellant's intrastate business'. 304 U.S. at page 239, 58 S.Ct. at page 890, 82 L.Ed. 1304. (2) On the issue of confiscation the Court of Civil Appeals had erred. The Company 'could not be denied the right to introduce evidence as to its property and business as an integrated system and to have the sufficiency of its evidence ascertained by the criterion which the Commission had properly used in the same manner in reaching its conclusion as to the Texas rate.' 304 U.S. at pages 241, 242, 58 S.Ct. at page 891, 82 L.Ed. 1304.

When the case came back to the Court of Civil Appeals, it held that 'when viewed in the light of the over-all or unsegregated basis and evidence the legislative rate order is valid as a matter of law', and that the validity of the order was established 'factually from so overwhelming a weight and preponderance of the evidence as to require a reversal in the interest of justice.' And so it again dissolved the injunction and reinstated the Commission's order. 129 S.W.2d 1164, 1170, 1187. This time the Supreme Court of Texas granted a writ of error and sent the case back to the District Court for a new trial. 153 S.W.2d 681.

In its extended opinion the Supreme Court of Texas reviewed these two rulings by the Court of Civil Appeals: (1) Since Article 6059 of the Revised Statutes of Texas¹ governing judicial review of the Commission's orders makes the Commission's findings of fact conclusive if supported by substantial evidence, and since the findings were supported by such evidence, the order was valid as a matter of law and left no question for the jury. (2) Even if Article 6059 required a trial de novo of all issues of fact, 'the Gas Company failed, as a matter of law, to offer evidence sufficient to justify holding this gas rate order confiscatory, or unreasonable and unjust.' 153 S.W.2d at page 687.

The Supreme Court of Texas held that Article 6059 does require a trial de novo in the District Court. It added that 'there is no escape from the conclusion that the United States Supreme Court did consider and did pass upon the sufficiency of the Gas Company's evidence, when considered from the viewpoint of the Company's entire properties, and did hold such evidence legally sufficient to sustain the verdict of the jury finding this rate order confiscatory.' 153 S.W.2d at page 689. Later in its...