Flota Mercante Grancolombiana, SA v. FEDERAL MAR. COM'N, 18230

• Decision Date: 23 March 1967
• Docket Number: 18235.,No. 18230,18230
• Citation: 373 F.2d 674
• Parties: FLOTA MERCANTE GRANCOLOMBIANA, S. A., Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, Philip R. Consolo, Intervenor. Philip R. CONSOLO, Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, Flota Mercante Grancolombiana, S. A., Intervenor.
• Court: U.S. Court of Appeals — District of Columbia Circuit

373 F.2d 674 (1967)

FLOTA MERCANTE GRANCOLOMBIANA, S. A., Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, Philip R. Consolo, Intervenor.

Philip R. CONSOLO, Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, Flota Mercante Grancolombiana, S. A., Intervenor.

Nos. 18230, 18235.

United States Court of Appeals District of Columbia Circuit.

February 7, 1967.

Petition for Rehearing Denied March 23, 1967.

COPYRIGHT MATERIAL OMITTED

Messrs. Odell Kominers and J. Alton Boyer, Washington, D. C., were on the brief for Flota Mercante Grancolombiana, S. A.

Messrs. Robert N. Kharasch, William J. Lippman and Mrs. Amy Scupi, Washington, D. C., were on the brief for Philip R. Consolo.

Asst. Atty. Gen. Donald F. Turner, Messrs. Robert N. Katz, Sol., Walter H. Mayo, III, Atty., Federal Maritime Commission, and Irwin A. Seibel, Atty., Dept. of Justice, were on the brief for respondents.

Before BAZELON, Chief Judge, WILBUR K. MILLER, Senior Circuit Judge, and WRIGHT, Circuit Judge.

BAZELON, Chief Judge:

This litigation is before us for the third time.¹ The first time we upheld the Federal Maritime Commission's determination that Flota Mercante Grancolombiana (Flota) was a common carrier of bananas between Ecuador and the United States, and that, by entering into a forward booking contract for all of its banana space with another shipper, Flota had unjustly and unreasonably refused to supply space on its ships to Consolo.² We also concluded that the Commission acted within its discretion in denying prejudgment interest to Consolo, in starting the reparations period at the time when Consolo first requested an allocation of space from Flota, in selecting the percentage allotment of space to which Consolo would have been entitled for the purpose of computing the reparations award, and in finding that Consolo and the favored shipper were competitors. We remanded the case to the Commission, however, to determine upon more thorough consideration whether the circumstances made a reparations award of any kind inequitable. We based this remand to consider the "cumulative equities" partially upon the following factors: The law defining Flota's obligations was unsettled; Flota was justifiably uncertain whether differences in its ships put it in a different category from other banana carriers; And there seemed to be extensive delays by the Commission in acting upon Flota's request for a declaratory judgment.

On remand the Commission affirmed its original action, and upon review we again reversed. The Supreme Court granted certiorari, however, 381 U.S. 933, 85 S.Ct. 1764, 14 L.Ed.2d 698, and ruled that the Commission's decision to award reparations was supported by substantial evidence.³ The Court remanded the case to us for further proceedings in accordance with its ruling. Supplemental briefs were filed in this court on the questions undecided by the Supreme Court, i. e., those relating to the Commission's computation of the reparations award. We now affirm the Commission.

The Reparations Standard.

The Commission determined that the underlying standard for reparations awards in cases involving a carrier's refusal to transport goods is the difference between the value of the goods at the point of tender and their value at destination, minus the cost of carriage. Pursuant to this formula, it computed the gross profit a shipper would have made on all shipments of bananas carried by Flota during the reparations period, and subtracted freight and incidental expenses. It then determined the percentage of space Consolo would have been entitled to during the reparations period, and awarded that percentage of this net profit figure to Consolo.

Flota claims this standard is inappropriate. Although it recognizes that we have already upheld the Commission's finding of competition between Consolo and the favored shipper, it contends that reparations must be based upon a showing of how much worse off the discriminatorily treated shipper is as a result of the discrimination, and not upon a calculation of how much better off he would have been had he not been discriminated against.⁴

We do not believe that the cases Flota cites — involving discriminatory rates among shippers — are apposite to a case in which the harm done to the shipper inheres in his inability to get his goods to the market, and we think the Commission applied the proper standard. The shipper's lost profits are the normal measure of damages in cases involving a refusal to carry,⁵ and the Supreme Court affirmed this principle in its rejection of our prior conclusion regarding the equity of giving Consolo his lost profits in the circumstances of this case:

We think the court below wrongly minimized the sting of losing expected profits resulting from being unjustly discriminated against and illegally denied shipping space. Such a loss is real and it is certainly compensable under the Shipping Act. (383 U.S., at 626, 86 S.Ct. at 1029.)

The Reparations Period.

The Commission calculated the reparations period to begin on August 23, 1957, when Consolo first made a request for an allocation of space on Flota's ships, and to end on July 12, 1959, when its order forcing Flota to accept shipments of bananas as a common carrier became effective. We have already held that Consolo would not be entitled to an earlier date for the beginning of the period, because before then he was bidding along with the favored shipper for exclusive use of the reefer space, and not for a share of it.

Flota contends, however, that Consolo's request for space on August 23, 1957, was not specific enough to justify using that date as the beginning of the reparation period. It was not until October 21, 1957, that Consolo requested a specific quantity of space to be given by November 15, 1957. Thus, Flota contends the period should not begin until either of these latter two dates. We think that the request made on August 23 was specific enough to alert Flota to its obligation to Consolo, and its subsequent refusal entitles the Commission to conclude that it would not have given him space at that time. While this date might not be the only appropriate one the Commission could have chosen, it was not an abuse of discretion to select it. The Board's choice of a beginning date is consonant with its selection of a date to conclude the reparations period. The concluding date was not based upon the time when Consolo actually arranged to have bananas on a Flota ship, but rather upon when he could have done so. Under Flota's theory, the concluding date would also have to be extended.

Flota further contends that the reparations period should not have begun until January, 1959, because it was then that it had a full fleet of new ships carrying bananas on the relevant route. We earlier upheld the Commission's finding that there was no significant difference between Flota's new vessels and others plying the banana trade, and we held that the new vessel limitations would not at any rate justify discrimination.⁶ This same conclusion is applicable to the older vessels in use during the reparations period. The vessels were capable of being used for banana carriage, they were so used by the preferred shipper, and Consolo was not allowed space even though he desired it. The gravamen of Flota's offense was its failure to accede to that desire.

Finally, Flota contends that the period should be shortened to take account of the delay by the Federal Maritime Commission in setting its request for a declaratory judgment on the docket, and of further delay caused by Consolo. This argument was part of Flota's argument on the "cumulative equities" issue which the Supreme Court rejected:

Nor do we feel the record reveals the reparation award is inequitable because Flota asked for declaratory relief or because that request was pending before the Board for almost two years. * * * Further, although Flota\'s suit was pending for about two years, the record indicates that much of the delay involved in this case was at the request or approval of Flota. At any rate, it has never been the law that a litigant is absolved from liability for that time during which his litigation is pending. 383 U.S., at 624-625, 86 S.Ct. at 1029.

We think this also applies to the issue of the reparations period.

The Computation of the Reparations Award.

Flota first argues that the Commission relied on the wrong cost figures as to the bananas. The Commission employed the figures introduced by Consolo showing the cost at which he purchased bananas in Ecuador. Although the record is not totally clear on the point, there is evidence that Puna, from which Consolo shipped, and Guayaquil, from which Flota sails, are only a short distance apart, that some of Consolo's banana sources are nearer to Guayaquil than Puna, and that shipping from Guayaquil would not have cost more. Flota had ample opportunity to introduce evidence suggesting different cost figures, but it did not do so. We conclude that the Commission could reasonably rely upon the evidence before it, and that its conclusions were justified. Flota subsequently attempted — during the remand hearing to determine the cumulative equities issue we had raised — to reopen the evidentiary record, so that it could supply additional evidence on this point. The Commission's refusal was not an abuse of discretion; Flota had had its opportunity, and was not entitled as a matter of law to a second chance. Interstate Commerce Commission v. Jersey City, 322 U.S. 503, 514-515, 64 S.Ct. 1129, 88 L.Ed. 1420 (1944); Virginia Petroleum Jobbers Ass'n v. Federal Power Comm., 110 U.S.App.D.C. 339, 293 F.2d 527, cert. denied, 368 U.S. 940, 82 S.Ct. 377, 7 L.Ed.2d 339 (1961).

Flota and Consolo both challenge the freight cost figure adopted by the Commission. The Commission originally adopted the freight figure that Flota charged to the favored shipper during...