Port of New York Authority v. United States

• Citation: 451 F.2d 783
• Decision Date: 09 November 1971
• Docket Number: 197,No. 196,Dockets 71-1769,71-1770.,196
• Parties: The PORT OF NEW YORK AUTHORITY, Plaintiff-Appellant, v. UNITED STATES of America and Interstate Commerce Commission, Defendants-Appellees. The CITY OF NEW YORK, Plaintiff-Appellant, v. UNITED STATES of America and Interstate Commerce Commission, Defendants-Appellees. Penn Central Transportation Company (Baker, Bond, Langdon and Wirtz, Trustees), Intervenor in Support of The Interstate Commerce Commission, and State of New York, Applicant for Intervention.
• Court: United States Courts of Appeals. United States Court of Appeals (2nd Circuit)

451 F.2d 783 (1971)

The PORT OF NEW YORK AUTHORITY, Plaintiff-Appellant, v. UNITED STATES of America and Interstate Commerce Commission, Defendants-Appellees.

The CITY OF NEW YORK, Plaintiff-Appellant, v. UNITED STATES of America and Interstate Commerce Commission, Defendants-Appellees.

Penn Central Transportation Company (Baker, Bond, Langdon and Wirtz, Trustees), Intervenor in Support of The Interstate Commerce Commission, and

State of New York, Applicant for Intervention.

Nos. 196, 197, Dockets 71-1769, 71-1770.

United States Court of Appeals, Second Circuit.

Argued September 17, 1971.

Decided November 9, 1971.

Arthur L. Winn, Jr., New York City (Sidney Goldstein, New York City, of counsel), for appellant The Port of New York Authority.

Martin S. Snitow, Asst. Corp. Counsel of The City of New York, New York City (J. Lee Rankin, Corp. Counsel, and Norman Redlich and Sheila A. Mahony, Asst. Corp. Counsel, New York City, of counsel), for appellant The City of New York.

Geraldine R. Keyes, Atty., I. C. C., Washington, D. C. (Fritz R. Kahn, Gen. Counsel, I. C. C., Washington, D. C., Richard W. McLaren, Asst. Atty. Gen., and John H. D. Wigger, Atty., U. S. Dept. of Justice, Washington, D. C., Whitney North Seymour, Jr., U. S. Atty., S. D. N. Y., New York City, of counsel), for appellees United States and I. C. C.

John A. Daily, New York City (Jerome H. Shapiro, New York City of counsel), for intervenor in support of the I. C. C.

Thomas F. Harrison, Asst. Atty. Gen. of N. Y., New York City (Louis J. Lefkowitz, Atty. Gen., Samuel A. Hirshowitz, First Asst. Atty. Gen., and Philip Weinberg, Asst. Atty. Gen., New York City, of counsel), for applicant for intervention State of New York.

Before MOORE, SMITH and HAYS, Circuit Judges.

MOORE, Circuit Judge:

The Port of New York Authority (Port Authority) and the City of New York (City) appeal from an order of the United States District Court for the Southern District of New York that denied their request for a temporary restraining order, dismissed their complaint, and refused to convene a three-judge district court.¹ The object of the appellants' complaint is an order of the Interstate Commerce Commission (Commission), dated June 28, 1971, which permitted intervenor Penn Central Transportation Company (Penn Central) to publish tariffs effecting interim additional charges for lighterage service² at New York Harbor.³

The district court based its decision on several grounds: that it lacked subject matter jurisdiction over the action, that the appellants lacked standing to sue, that there appeared to be little likelihood of success on the merits, and that the case was not yet ripe for judicial determination. We affirm on the basis of the first stated ground, and therefore need not and do not express any opinion on the soundness of the district court's other bases for its decision.⁴

History of the Penn Central Tariff

This case had its inception when Penn Central filed with the Commission tariff schedules setting forth additional charges for lighterage service at New York Harbor.⁵ The additional charges were published to become effective on May 29, 1971. Following protests by appellants and others to the increased rates, the Board of Suspension, an employee board created by the Commission, suspended the effective date of the tariffs for the statutory period of seven months and instituted an investigation into the lawfulness of the proposed rates.⁶

Penn Central then filed a petition for reconsideration and vacation of the suspension order with an appellate division of the Commission.⁷ On June 28, 1971, this division denied the petition, but authorized Penn Central to publish tariffs containing additional lighterage charges not to exceed 50% of those initially proposed.⁸ Further, this order directed Penn Central to maintain an account from which payments could be refunded to the extent that the proposed tariffs were not justified before the Commission.

Appellants then filed with the Commission a petition to reconsider the June 28th order.⁹ Pending consideration of this petition, the Commission stayed the June 28th order.¹⁰ On July 28, 1971, the Commission denied the petition for reconsideration.¹¹ This suit followed.

Jurisdiction Over Suspension Orders

Appellants concede that the initial decision of whether to suspend the effective date of proposed tariffs is within the sole discretion of the Commission.¹² However, they contend that once the Suspension Board decides to suspend the effective date of proposed tariffs, the Commission in its appellate capacity cannot arbitrarily reverse this decision.¹³ The apparent theory underlying this contention is that it is a violation of due process for the Commission to reverse without deliberation a decision of its Suspension Board that is reached after careful deliberation.

We reject appellants' contention. First, appellants exaggerate the care with which the Suspension Board approaches its task and the carelessness with which the appellate division approaches its task. The purpose of suspension proceedings is to determine whether it would be in the interests of the public to suspend the effective date of proposed rates pending an investigation into the lawfulness of such rates.¹⁴ The proceedings are informal.¹⁵ No "findings" of fact in the judicial sense of the term are made. A transcript of the proceedings is not taken. Subpoenas cannot be issued. The petitions and replies are generally not verified under oath. That suspension orders through time contain the same wording further belies the validity of the contention that these proceedings are deliberate.¹⁶ Finally, the appellate division, contrary to appellants' contention, did in the instant case give a reason for its modification of the original suspension order.¹⁷

More importantly, appellants' contention must fail on logical and legal grounds. First, it makes little sense to argue that the decisions of the Commission in its appellate capacity should be subject to judicial review after conceding that the decisions of the Commission's Suspension Board are not subject to judicial review.¹⁸ The reasons for insulating the decision to suspend the effective date of proposed tariffs from judicial scrutiny in the first instance apply with equal force to the appellate decision. First, to permit judicial review of appellate decisions would invite the competitive inequities and the diversity among court decisions that initially prompted Congress to insulate the suspension decision from judicial review.¹⁹ Second, permitting the courts to review appellate decisions would encourage that very interference with the orderly review of tariff proposals that the doctrine of primary jurisdiction is intended to preclude.²⁰

Prior to the Supreme Court's decision in Arrow Transportation Co. v. Southern Railway Co., there was a conflict among three-judge district courts on the question of whether Commission orders vacating suspension orders are judicially reviewable.²¹ We believe that Arrow has resolved this conflict in favor of those courts holding no review.²² While it is true that the holding of Arrow does not directly control the issue here,²³ the opinion in the case clearly indicates that courts are not to interfere with suspension proceedings:

We cannot believe that Congress would have given such detailed consideration to the period of suspension the consideration manifested in the legislative history of the Commission\'s suspension powers unless it meant thereby to vest in the Commission the sole and exclusive power to suspend and to withdraw from the judiciary any pre-existing power to grant injunctive relief. This Court has previously indicated its view that the present section had that effect. In Board of Railroad Comm\'rs of State of North Dakota v. Great Northern R. Co., 281 U.S. 412, 429, 50 S.Ct. 391, 74 L.Ed. 936, Chief Justice Hughes said for the Court: "This power of suspension was entrusted to the Commission only." The lower federal courts have said as much. And the commentators on the matter have consistently supported the soundness of that view.²⁴

The basis of the decision in Arrow— that to permit judicial interference with the Commission's suspension procedures would invite the very disruption in the orderly review of the lawfulness of proposed tariffs that Congress meant to preclude—applies with equal force to the issue now before us.

The June 28th Order and NEPA

The City argues that the failure of the Commission to accompany its June 28th order with an environmental impact statement violates section 102(2) (C) of the National Environmental Policy Act of 1969 (NEPA).²⁵ The City contends that the increased lighterage tariffs will cause the diversion of a substantial amount of traffic from barges and scows to trucks, and that the iscreased use of trucks will substantially worsen the already poor quality of New York's air. The City thus asks for a stay of the order permitting Penn Central to effect interim increases in lighterage tariffs until an environmental impact statement is prepared.

We disagree with the City. To grant its request would defeat the very purpose of NEPA. The Act itself, the legislative history of the Act, the President's Executive Order implementing the Act, the guidelines for federal agencies issued by the Council on Environmental Quality, the courts that have interpreted the Act, and commentators clearly establish that NEPA requires a careful evaluation by federal agencies of the nonenvironmental benefits and environmental costs of their actions.²⁶ As the court said in the recent Calvert Cliffs'²⁷ case:

NEPA mandates a case-by-case balancing judgment on the part of federal agencies. In each individual case, the particular economic and technical benefits of planned action must be assessed and then weighed against the environmental costs; alternatives must be considered which would affect the balance of values. * * * The magnitude of

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