Railway Labor Executives' Ass'n v. I.C.C.

• Decision Date: 01 February 1991
• Docket Number: P,No. 19,No. 89-70134,GO-887,19,89-70134
• Parties: RAILWAY LABOR EXECUTIVES' ASSOCIATION; International Association of Machinists and Aerospace Workers, District Lodge; and United Transportation Union, General Committee of Adjustmentetitioners, v. INTERSTATE COMMERCE COMMISSION; and United States of America, Respondents.
• Court: U.S. Court of Appeals — Ninth Circuit

Page 961

924 F.2d 961

RAILWAY LABOR EXECUTIVES' ASSOCIATION; International Association of Machinists and Aerospace Workers, District Lodge No. 19; and United Transportation Union, General Committee of Adjustment GO-887, Petitioners, v. INTERSTATE COMMERCE COMMISSION; and United States of America, Respondents.

No. 89-70134.

United States Court of Appeals Ninth Circuit.

Argued and Submitted May 18, 1990.

Decided Feb. 1, 1991.

Donald F. Griffin, Highsaw & Mahoney, Washington, D.C., for petitioners.

Lawrence H. Schecker, I.C.C., Washington, D.C., for respondents.

Guy Vitello, Chicago, Ill., and E. Barrett Prettyman, Jr., Hogan & Hartson, Washington, D.C., for respondents-intervenors.

Petition for Review of a Decision of the United States Interstate Commerce Commission.

Before FLETCHER and BEEZER, Circuit Judges, and FITZGERALD, District Judge. ^*

BEEZER, Circuit Judge:

The Railway Labor Executives' Association ("RLEA"), the International Association of Machinists and Aerospace Workers ("IAM") and the United Transportation Union ("UTU") ¹ petition for review of a decision of the Interstate Commerce Commission ("ICC" or "Commission") declining to impose protective conditions for railway employees under 49 U.S.C. Sec. 11347. ² We affirm in part and remand to the ICC for further proceedings.

I

Various facets of this case have been pending before the ICC. Santa Fe Industries ("SFI"), a holding company for the Atchison, Topeka & Santa Fe Railway Company ("ATSF"), agreed in 1983 to consolidate with the Southern Pacific Company ("SPC"), a holding company for the Southern Pacific Transportation Company ("SPT"). SFI and SPC merged to form the Santa Fe Southern Pacific Corporation ("SFSP"). Before SFSP could exercise control over both railroads, it needed to get ICC approval under 49 U.S.C. Sec. 11343. Pending ICC approval of the merger, SFSP placed SPC's stock in SPT in an independent voting trust.

In December of 1983, the ICC issued an order prohibiting the merger pending the Commission's review of the voting trust. 2 I.C.C.2d 712, 715 (1986). After examining the trust, the ICC concluded in an unpublished decision that the trust was compatible with ICC regulations.

In October of 1986, the ICC denied SFSP's applications to control SPT and to merge SPT with ATSF. Santa Fe Southern Pacific Corp.--Control, 2 I.C.C.2d 709 (1986). The Commission concluded that granting SFSP's applications would have anti-competitive effects. It ordered SFSP to divest itself of either ATSF or SPT, subject to Commission oversight. Id. at 834-36.

SFSP decided to sell SPT to Rio Grande Industries ("RGI"), a holding company for the Denver & Rio Grande Western Railroad Co. ("DRGW"). The ICC approved SFSP's divestiture of SPT and RGI's application to control SPT in Rio Grande Industries--Control--SPT Co., 4 I.C.C.2d 834 (1988).

In Rio Grande Industries, RLEA petitioned the ICC to impose employee protective conditions under 49 U.S.C. Sec. 11347 for the employees who were adversely affected by actions taken in anticipation of the disapproved SPT-ATSF merger. The ICC declined to impose protective conditions for actions taken by ATSF or SPT. Id. at 955. It first explained that ATSF was not an applicant to the Rio Grande Industries proceeding. The Commission then noted that it provides labor protection under 49 U.S.C. Sec. 11347 only where it approves a merger transaction. It concluded that it lacked authority in the RGI acquisition proceeding to mandate protective conditions for the aborted ATSF-SPT merger for actions taken by ATSF or SPT. Id.

However, the Commission agreed to examine in a subsequent proceeding whether employees affected by actions of SFSP in connection with the ATSF-SPT merger should be afforded labor protection. Id. at 955-56. Unlike ATSF and SPT, ICC subjected SFSP to continuing jurisdiction because of SFSP's "control" of SPT through the voting trust. Because it believed that the issue needed further analysis, the ICC invited comments on the extent of its authority to impose protective conditions on employees affected by actions taken by SFSP.

The Commission received comments from RLEA, SPT and SFSP. In the decision under review in this case, the Commission declined to impose labor protective conditions. The ICC concluded that it lacked authority to impose protective conditions under 49 U.S.C. Sec. 11347 because it had not approved the ATSF-SPT merger. It explained that employees affected by actions taken by ATSF or SPT could resort to grievance procedures in collective bargaining agreements. Employees who were affected by actions taken by SFSP, the Commission contended, could institute civil actions under 49 U.S.C. Sec. 11705.

In a related case, this court addressed the claims of SPT employees against ATSF and SFSP arising under the Interstate Commerce Act ("ICA") and Oregon's law of tortious interference with an economic relationship. Kraus v. Santa Fe Southern Pacific Corp., 878 F.2d 1193 (9th Cir.1989), cert. dismissed, --- U.S. ----, 110 S.Ct. 1329, 107 L.Ed.2d 850 (1990). In Kraus, we refused to examine the merits of plaintiffs' claim that ATSF unlawfully exercised control over SPT in violation of the ICA. Noting that ICC authority over mergers is exclusive, we held that the district court lacked jurisdiction over plaintiffs' ICA claim. Id. at 1198. We explicitly rejected the reasoning of the ICC decision under review in this case and held that employees affected by decisions of SFSP in connection with the failed ATSF-SPT merger could not file suit in district court under 49 U.S.C. Sec. 11705 alleging unlawful control under 49 U.S.C. Sec. 11343. Id. at 1198 n. 2.

RLEA, IAM and UTU petition for review of the ICC's decision refusing to impose protective conditions for employees affected by the disapproved ATSF-SPT merger. The ICC and intervenors SFSP and ATSF argue (1) that IAM and UTU lack standing and that we should transfer this case because venue for RLEA's petition is not proper in this court, and (2) that the ICA does not authorize protective conditions for the railway employees involved in this case.

II

ICC, SFSP and ATSF contend that IAM and UTU lack standing to petition for review of the ICC's decision. Only "part[ies] aggrieved" by an ICC order may petition for review under 28 U.S.C. Sec. 2344. ³ To have standing, petitioners must have been parties to the proceeding under review. Sierra Club v. United States Nuclear Regulatory Commission, 825 F.2d 1356, 1360-61 (9th Cir.1987). Accord Water Transport Association v. I.C.C., 819 F.2d 1189, 1192-93 (D.C.Cir.1987); Packard Elevator v. I.C.C., 808 F.2d 654, 655 (8th Cir.1986), cert. denied sub nom., International Brotherhood of Electrical Workers v. I.C.C., 484 U.S. 828, 108 S.Ct. 98, 98 L.Ed.2d 59 (1987). Because neither IAM nor UTU filed comments with the ICC concerning the Commission's authority to impose labor protective conditions in this case, the ICC and the intervenors contend that IAM and UTU lack standing.

Petitioners IAM and UTU claim that they were parties to the agency proceeding under review. The ICC docketed proceedings relating to SFSP's application to control SPT and to merge ATSF with SPT under Finance Docket Number 30400. The ICC's unpublished decision approving the voting trust was denominated Decision No. 2 under main docket number 30400. The ICC decision under review here was docketed under 30400 as Sub-No. 21.

UTU argues that its General Chairman was a party of record to main docket number 30400 and hence a party to all proceedings under that docket number. IAM's General Chairman claims he is similarly listed as a party of record in Subs 8 through 20.

Petitioners add that the ICC only solicited comments on its authority to impose protective conditions. It did not ask parties to restate their intention to participate in the proceedings. Because the ICC had requested parties to restate their intention to participate in proceedings in at least one unpublished decision, petitioners ask us to infer that the ICC presumed that the parties in this case would continue to participate in all sub-numbered proceedings. See Blackstone Capital Partners L.P.--Control--CNW Corporation and Chicago and North Western Transportation Co., Finance Docket No. 31493 (Sub-No. 1) (unpublished) (July 5, 1989).

We asked the parties to provide supplemental briefing on the standing issue. UTU maintained that it is only fair to assume that parties to lead docket numbers remain parties to all sub-numbered proceedings. The ICC conceded that it sometimes consolidates main docket proceedings with sub-numbered proceedings, treating the consolidated proceeding as one proceeding. The ICC also admitted that its procedures with regard to main docket numbers and sub-numbered proceedings are not codified in agency regulations and are only "accepted internal practices that have been in place for many years." However, the ICC argued that it published notice in the Federal Register asking for comments, and UTU and IAM could have participated if they wanted to comment. The ICC suggested that the UTU should have been aware that the ICC for several years has treated sub-numbered proceedings as completely different proceedings from main docket proceedings.

The only Ninth Circuit case addressing the "party" requirement of 28 U.S.C. Sec. 2344 is Sierra Club. In that case, we held that the petitioner lacked standing because it was not a party to the agency proceeding under review and because it did not participate at all in the agency's decision. This case is different because UTU was a party to the main docket number under review and because IAM participated as a party to several sub docket numbers.

We conclude that the UTU was a party aggrieved by the Interstate Commerce Commission's order in Santa Fe Southern Pacific Corp.--Control--Southern Pacific Transportation Co., Finance Docket No. 30400 (Sub-No. 21) (January 25, 1989) by virtue of being a party to the main docket...