Rardin Grain Company v. Illinois Central Railroad Co.

• Decision Date: 04 September 1968
• Docket Number: No. 4163.,4163.
• Citation: 288 F. Supp. 813
• Parties: RARDIN GRAIN COMPANY, Dewein Grain Company, Mt. Pulaski Grain Co., Tabor & Co., Blue Mound Grain & Fertilizer Co., Inc., Homer Grain Company, Walter Galloway d/b/a Watson Grain Company, Garnac Grain Co., Inc. (Midwestern Grain Company Division), Graham & Ragle, the Board of Trade of Kansas City, Missouri, Plaintiffs, A. E. Staley Manufacturing Company, Pillsbury Company, Ralston Purina Company, Central Soya Company, Inc., and Corn Refiners Association, Inc., Intervening Plaintiffs, v. ILLINOIS CENTRAL RAILROAD COMPANY, United States of America and Interstate Commerce Commission, Defendants.
• Court: U.S. District Court — Southern District of Illinois

288 F. Supp. 813

RARDIN GRAIN COMPANY, Dewein Grain Company, Mt. Pulaski Grain Co., Tabor & Co., Blue Mound Grain & Fertilizer Co., Inc., Homer Grain Company, Walter Galloway d/b/a Watson Grain Company, Garnac Grain Co., Inc. (Midwestern Grain Company Division), Graham & Ragle, the Board of Trade of Kansas City, Missouri, Plaintiffs, A. E. Staley Manufacturing Company, Pillsbury Company, Ralston Purina Company, Central Soya Company, Inc., and Corn Refiners Association, Inc., Intervening Plaintiffs, v. ILLINOIS CENTRAL RAILROAD COMPANY, United States of America and Interstate Commerce Commission, Defendants.

No. 4163.

United States District Court S. D. Illinois, S. D.

September 4, 1968.

Leslie N. Jones, Flora, Ill., Harold E. Spencer, Chicago, Ill., Robert G. Heckenkamp, Springfield, Ill., for plaintiffs.

William J. O'Brien, Jr., Chicago, Ill., Graham & Graham, Springfield, Ill., Leonard S. Goodman, Dept. of Justice, Washington, D.C., Richard E. Eagleton, U.S. Atty., Peoria, Ill., Gillespie, Burke & Gillespie, Springfield, Ill., for defendants.

OPINION AND ORDER

ROBERT D. MORGAN, District Judge.

The complaint and intervenors' complaints herein pray a decree enjoining defendant, Illinois Central Railroad Company (hereinafter Central), from providing service under its Rent-a-Train Grain Tariff and compelling the defendant, Interstate Commerce Commission (hereinafter ICC), to expunge said tariff from its files.

The cause is before the court upon the motions of all plaintiffs¹ for summary judgment and the motions of defendants to dismiss the complaint for want of jurisdiction. The original complaint was filed in this court on December 22, 1967. It was referred to the undersigned on June 4, 1968, and the respective motions were argued at Peoria on June 24, 1968. Comprehensive and scholarly briefs have been filed in support of the respective positions.

The Court is convinced that the motions to dismiss must be allowed, and hence this opinion addresses itself only to the jurisdictional issue.

The applicable statutory provision is Section 6 of the Interstate Commerce Act. 49 U.S.C. § 6. That Act requires every common carrier to file with the ICC, and keep open for public inspection, "schedules showing all the rates, fares, and charges for transportation" between points served by such carrier. 49 U.S.C. § 6(1). It further authorizes the ICC to prescribe, by regulations, the form and manner in which such schedules shall be filed and published, and "the Commission is authorized to reject any schedule filed with it which is not in accordance with this section and with such regulations." 49 U.S.C. § 6(6).

Among the regulations promulgated by the ICC under the Act is its Rule 4(i), which requires that all tariffs state the rates for freight transportation by specific designation of the charge per ton, or other designated unit of weight or volume, for a commodity transported between designated points.

Upon Central's application, the ICC waived the applicability of its Rule 4(i) to the tariff in suit, whereupon the tariff was filed and published on October 27, 1967. Plaintiffs and others requested the ICC to suspend the tariff pending the determination of its legality. On November 24, 1967, the Board of Suspension of the ICC denied that request, but it ordered that an investigation be made to determine the legality of the tariff. An appeal of the Board's refusal of suspension was denied by the ICC. The tariff became effective November 29, 1967.

The tariff purports to state rates upon shipments of grain for export, in bulk, from all points upon Central's line in Illinois to five designated ports on the Gulf of Mexico.

Plaintiffs assert the illegality of the tariff's provisions which follow. All rates therein are stated upon the basis of a "rent-a-train" concept. Central proposes to make available to persons shipping grain between the above-mentioned points, for export, complete rental trains, each composed of necessary motive power and eighty-six covered hopper cars.² The base annual rental for each such train, if Central's cars are employed, is $1,000,000. A reduced base rental is provided if shipper-owned, or leased, cars are employed. In either event the tariff establishes a charge, in addition to the base rental, of 1.5 mills per ton-mile of transport, with a minimum charge of $5.00 per train mile, whether the train is loaded or empty. The tariff also provides that Central will maintain a guaranteed minimum train speed upon all one-way trips of 600 miles or more. It establishes a formula for imposition of a monetary penalty against Central for breaches of that guarantee.

Plaintiffs must concede that the ICC has primary jurisdiction to determine whether any tariff complies with the provisions of the Act. 49 U.S.C. §§ 6(6), 15(1). They must also concede that, in areas placed by Congress within the competence of the jurisdiction of the ICC, a controversy must first be submitted to that agency for decision, e.g., Arrow Transportation Company v. Southern Ry. Co., 372 U.S. 658, 83 S.Ct. 984, 10 L.Ed.2d 52, subject to review by a three-judge district court. 28 U.S.C. §§ 1336, 2321-2325.

The logical consequence of those concessions is the refutation of the court's jurisdiction over this complaint. Plaintiffs, however, seek to avoid that logical consequence by their theory that the unique provisions of this tariff, as above summarized, render it "not a tariff" and thus, per se, illegal. They argue that Section 6 requires that uniform "rates" be published by a succinct statement of the charge made per specified unit of transportation between designated points, that this tariff fails to establish rates so stated and so defined, that the tariff employs no terms of art which require ICC interpretation, that only questions of law are involved and that plaintiffs may invoke the general equity jurisdiction of this court since the cause presents a controversy arising under a statute regulating commerce. 28 U.S.C. § 1337.

That argument appears to this court to be an ingenious but invalid attempt to circumvent the statutory provisions governing the rate-making process. The Act contemplates that rates be established by the initiative of a carrier by its filing and publishing such rates with the ICC, 49 U.S.C. § 6, subject to the power of the ICC to reject and void any rate which it finds to be not in compliance with the Act and ICC rules, 49 U.S.C. § 6(6), and subject to the power of the ICC to suspend the effectiveness of any such rate for a limited period of time pending the hearing and disposition of proceedings by the ICC to determine the validity of the rates filed. 49 U.S.C. § 15(7). The ICC is vested with power, upon complaint or upon its own initiative, after an investigation and a full hearing, to set aside any rate or carrier classification which it finds to be unreasonable, unjustly discriminatory, unjustly preferential, or, in other manner, in violation of any provision of the Act. 49 U.S.C. § 15(1), (7).

The question of the validity of this tariff will depend upon the consideration of many factors. The tariff is limited to shipments of grain to specified...