In re REA Express, Inc.

• Decision Date: 21 December 1972
• Docket Number: No. 115.,115.
• Parties: In re REA EXPRESS, INC., Private Treble Damage Antitrust Litigation.
• Court: Judicial Panel on Multidistrict Litigation

352 F. Supp. 803

In re REA EXPRESS, INC., Private Treble Damage Antitrust Litigation.

No. 115.

Judicial Panel on Multidistrict Litigation.

December 21, 1972.

Before ALFRED P. MURRAH^*, Chairman, and JOHN MINOR WISDOM, EDWARD WEINFELD, EDWIN A. ROBSON, WILLIAM H. BECKER, JOSEPH S. LORD, III, and STANLEY A. WEIGEL, Judges of the Panel.

OPINION AND ORDER

PER CURIAM.

REA Express, Inc., an express common carrier, initiated an action in the Eastern District of Pennsylvania against more than 160 railroads under Sections 1 and 2 of the Sherman Act. Many of the defendant railroads objected to the venue of the action and to service of process. These objections were resolved by the transfer of the action against certain of the defendants to eight other districts. REA now seeks the transfer of those eight identical antitrust actions to the Eastern District of Pennsylvania for coordinated or consolidated pretrial proceedings with the action pending there, pursuant to 28 U.S.C. § 1407.

REA also seeks transfer of two additional actions in which it is a defendant. The first is brought by the St. Louis-Southwestern Railway Co. in the Northern District of California, alleging that REA has failed to pay it for transportation of express traffic. The second action naming REA as a defendant is brought by the Seaboard Coast Line Railroad Co. in the Middle District of Florida, seeking recovery of sums allegedly due from REA for services rendered.

The defendant railroads agree on the desirability of transferring all actions, except the Seaboard action, to the Eastern District of Pennsylvania. We find that all actions, including the Seaboard action, share extensive common issues of fact and that their transfer to the Eastern District of Pennsylvania for coordinated or consolidated pretrial proceedings will serve the convenience of the parties and witnesses and further the just and efficient conduct of the litigation.

In its antitrust actions REA alleges that the defendant railroads, including the St. Louis-Southwestern and the Seaboard Coast Line, combined and conspired, from 1929 to the present, to avoid competition in furnishing transportation services to REA, to impose excessive charges for the use of their facilities and to prevent REA from competing with them or using other methods of transportation. The alleged conspiracy is said to have been a misuse of the defendants' monopoly power and an expansion of their monopoly into the express business.

One of the central questions common to all the antitrust cases is whether the railroads conspired to force REA to pay more than was required for transportation of trailers on flat cars (piggyback service). REA apparently asserts that, as a common carrier, it was not obligated to pay published ICC tariff rates for such service but could negotiate lower rates from the railroads. It alleges, however, that in 1967 the defendants, through their control of REA's stock, forced it to adopt a policy of paying ICC tariffs (Plan II½ and Plan III tariffs) for piggyback service from the defendants. The defendants deny these allegations. The need for coordinated pretrial proceedings in these antitrust cases is clearly established by these common issues of fact.

In the St. Louis-Southwestern case the plaintiff is seeking recovery for transportation services rendered REA pursuant to a regional master agreement which REA alleges to be part of the antitrust conspiracy. St. Louis-Southwestern has asserted the same claim as a counterclaim in REA's Pennsylvania antitrust suit. As the filing of the Pennsylvania counterclaim indicates, the St. Louis-Southwestern action arises from the same factual background as the antitrust cases and should be assigned to the same judge for pretrial proceedings.

Seaboard, joined by the other railroads, urges that insufficient common questions of fact are raised by the second amended complaint in its Florida action to support pretrial coordination with the remaining actions.¹ It asserts that the Florida action was brought to recover for transportation services rendered REA in 1967 and 1968 and that the basis for this recovery is not the agreements between REA and the railroads attacked in the Pennsylvania action but a series of specific agreements between Seaboard and REA based on the ICC-approved tariff rates.

A review of the pleadings in this case leads to the opposite conclusion and makes clear the need to include it in coordinated pretrial proceedings. The first amended complaint of Seaboard in Florida specifically pleaded REA's 1967 policy in support of its claim for Plan II½ and III tariffs from REA for piggyback and related services. The second amended complaint has eliminated this...