Seatrain Lines v. Pennsylvania R. Co.

Citation108 F. Supp. 113
Decision Date21 November 1952
Docket NumberNo. C-1188.,C-1188.
PartiesSEATRAIN LINES, Inc. v. PENNSYLVANIA R. CO. et al.
CourtU.S. District Court — District of New Jersey

Jamieson & Walsh, Crawford Jamieson, Trenton, for plaintiff, Carl E. Newton, Theodore S. Hope, Edward L. Meyer, New York City, of counsel.

Sackett M. Dickinson, John W. Griggs, Trenton, N. J., for Pennsylvania R. Co., George L. Haskins, Joseph F. Eshelman, Philadelphia, Pa., Covington & Burling, Hugh B. Cox, Washington, D. C., of counsel.

John W. Griggs, Trenton, N. J., for Presidents' Traffic Conference-Eastern Railroads, Traffic Executive Ass'n-Eastern Railroads, General Freight Traffic Committee-Eastern Railroads, Freight Traffic Committee-New England Territory Railroads, Freight Traffic Committee-Trunk Line Territory Railroads and Freight Traffic Committee-Central Territory Railroads, Debevoise, Plimpton & McLean Samuel E. Gates, Robert B. Von Mehren, New York City, of counsel.

Pitney, Hardin & Ward, Waldron M. Ward and Robert P. Hazlehurst, Jr., Newark, N. J., for Atlantic Coast Line R. Co., Shea, Greenman, Gardner & McConnaughey, Francis M. Shea, Washington, D. C., Charles Cook Howell, Wilmington, N. C., of counsel.

Carey, Schenk & Jardine, Newark, N. J., Robert Carey, Jersey City, N. J., Thomas V. Jardine, Newark, N. J., for Louisville & N. R. Co., H. T. Lively, Louisville, Ky., of counsel.

Pitney, Hardin & Ward, Waldron M. Ward and Robert P. Hazlehurst, Jr., Newark, N. J., for Southern Ry. Co., Shea, Greenman, Gardner & McConnaughey, Francis M. Shea, Sidney S. Alderman, Herny L. Walker, Washington, D. C., of counsel.

Markley & Broadhurst, James J. Langan, Jersey City, N. J., for Baltimore & O. R. Co., L. James Huegel, Baltimore, Md., Covington & Burling, Hugh B. Cox, Washington D. C., of counsel.

Minard, Cooper, Gaffey & Webb, Duane E. Minard, Newark N. J., for Erie R. Co.

Pitney, Hardin & Ward, Waldron M. Ward and Robert P. Hazlehurst, Jr., Newark, N. J., for Association of American Railroads, J. Carter Fort and Thomas L. Preston, Washington, D. C., of counsel.

Pitney, Hardin & Ward, Waldron M. Ward and Robert P. Hazlehurst, Jr., Newark, N. J., for Seaboard Air Line R. Co., James B. McDonough, Jr., Charles T. Abeles, Norfolk, Va., Harold J. Gallagher, New York City, W. R. C. Cocke, Norfolk, Va., of counsel.

O'Mara, Schumann, Davis & Lynch, Joseph A. Davis, Jersey City, N. J., for New York Cent. R. Co., Dorr, Hand & Dawson, George W. Whittaker, New York City, of counsel.

FORMAN, Chief Judge.

— I —

So much of the amended complaint filed by the plaintiff, Seatrain Lines, Inc. (hereinafter called Seatrain), as is essential to the present considerations, charges as follows:

In 1929 Overseas Railways, Inc. began to carry goods between the ports of New York and New Orleans, via Havana, Cuba. On December 31, 1931 Seatrain acquired its net assets and it was merged and consolidated with Seatrain on October 14, 1933. In October of 1932 Seatrain inaugurated its interstate service between the ports of New York and New Orleans, via Havana, Cuba. In or about June of 1940 it added a service between the ports of New York and Texas City, Texas and on November 30, 1951 it added a further service between the ports of New York and Savannah, Georgia.

Seatrain developed a special type of vessel for the carriage of freight in railroad cars over the long distances in ocean routes. Each of the vessels used by Seatrain is so constructed that it can carry 100 railroad cars on four decks. Special equipment is provided to hoist these cars from adjacent tracks on the docks and move them bodily into the vessels. This procedure makes it unnecessary for goods carried to the ports in railroad cars to be unloaded from the cars and carried piecemeal into the vessels.

Seatrain maintains physical facilities for the interchange of freight cars at dockside at the Port of New York (Edgewater, New Jersey), with the New York, Susquehanna and Western Railroad Company; at the Port of New Orleans (Belle Chasse, La.) with the New Orleans and Lower Coast Railroad Company; at Texas City, Texas, with the Southern Pacific Lines; Missouri Pacific Lines; Gulf, Colorado & Santa Fe; Missouri, Kansas & Texas; Fort Worth & Denver; Chicago, Rock Island & Pacific, and the Texas City Terminal Railroad; and at Savannah, Georgia, with the Central of Georgia Railway Company.

In May of 1942 all of Seatrain operations were suspended as a result of the requisition of its ships, then five in number, for use by the United States in World War II. On March 12, 1947, its vessels having been returned to it by the government and reconditioned, it assumed its coastwise freight services. Two additional vessels were built and placed in operation in the latter part of 1951.

There are 10 defendants who are common carriers by rail engaged in the transportation of commodities in interstate commerce within the United States, namely: Pennsylvania Railroad Company, Atlantic Coast Line Railroad Company, Southern Railway Company, Louisville & Nashville Railroad Company, Lehigh Valley Railroad Company, Baltimore and Ohio Railroad Company, Seaboard Air Line Railroad Company, St. Louis-San Francisco Railroad Company, New York Central Railroad Company and Erie Railroad Company.

Also named as defendants are seven unincorporated associations of railroad corporations alleged to be supported, maintained and utilized by railroads, including the defendant railroads. The defendant associations are: Association of American Railroads, Presidents' Traffic Conference-Eastern Railroads, Traffic Executive Association-Eastern Railroads, General Freight Traffic Committee-Eastern Railroads, Freight Traffic Committee-New England Territory Railroads, Freight Traffic Committee-Trunk Line Territory Railroads, and Freight Traffic Committee-Central Territory Railroads.

The first four defendants, Pennsylvania Railroad Company, Atlantic Coast Line Railroad Company, Louisville & Nashville Railroad Company and Southern Railway Company, are the primary defendants in a combination and conspiracy, together with other railroads and the defendant Association of American Railroads and the other defendant corporations. The remaining six railroads are secondary defendants, having been induced by the primary defendants to join in said combination and conspiracy.

Seatrain is a holder of a Certificate of Public Convenience and Necessity issued to it by the Interstate Commerce Commission authorizing continuance of its operations between the ports of New York, New Orleans and Texas City and the grant of temporary authority to operate between the ports of New York and Savannah, similarly issued on November 13, 1951.

Except for the suspension of its service in World War II, as aforesaid, Seatrain has been operating continuously since 1932 in competition with railroads for interstate freight traffic between areas tributary to the gulf ports and areas tributary to the Port of New York, and since November 30, 1951 has been in similar competition for such traffic between areas tributary to the Port of New York and the Port of Savannah.

Seatrain transports freight generally at lower rates than the railroads and by using Seatrain service shippers are saved packing and handling expenses necessarily incurred when freight is shipped over break-bulk water routes. In addition, certain classes of bulk freight which cannot be handled in vessels of the usual type and which cannot bear all rail charges can be handled by Seatrain and thus markets are opened up for them which otherwise could not be reached.

The interstate commerce involved is primarily transportation of freight in loaded freight cars, principally conducted by common carriers by rail but Seatrain and certain railroad-owned or controlled water carriers (commonly known as "car ferries"), are, and have been, engaged therein.

The goods shipped all-rail from points in the northeast to points in the south or southwest must be transported over the lines of more than one railroad since the lines of no one railroad extend into both these territories; such transportation is effected, successively, by the several railroads whose lines are involved, each utilizing its own personnel, tracks, right of way, motive power, and other fixed and movable equipment, other than freight cars, but the car itself in which the freight is originally loaded, which may be owned by the railroad on which the traffic originated, by some other railroad participating in the haul, or by some railroad not participating therein, is loaded for shipment at the point of origin and hauled from point of origin to point of destination over all the lines of railroad involved, without unloading or reloading enroute.

Mutual and reciprocal arrangements between railroads of the United States, including all of the defendant railroads, have existed for many years under which railroad-owned freight cars are loaded, hauled, and delivered in interchange without restriction between the various railroads and have been used in continuous haul over the various railroads of the United States regardless of railroad ownership of the freight cars and of the railroads participating in the haul.

By such arrangements and agreements each railroad foregoes for the benefit of other railroads its right to control the use of its own freight cars (within limitations imposed by the Interstate Commerce Commission) and thereby surrenders such competitive advantage as it would otherwise possess as the owner of freight cars and the arrangements amount to, in effect, unrestricted, reciprocal licensing by each railroad of all other railroads in interchanging the cars owned by one railroad and that each railroad thereby acquires competitive advantages which it would not have if it would not have participated in such arrangements and agreements, and as a group the railroads of the country thereby acquire competitive benefits which they would not have if...

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2 cases
  • Walker v. United States
    • United States
    • U.S. District Court — Western District of Texas
    • August 10, 1962
    ...the statute. §§ 5(2) (b), 16(6) and 204(a) (6), 49 U.S.C.A. §§ 5(2) (b), 16(6), 304(a) (6). See also Seatrain Lines, Inc. v. Pennsylvania R. Co., D.N.J., 1952, 108 F.Supp. 113, 126; Philadelphia-Detroit Lines v. United States, S.D.Fla., 1939, 31 F.Supp. 188, aff'd 308 U.S. 528, 60 S.Ct. 384......
  • Seatrain Lines v. Pennsylvania R. Co.
    • United States
    • U.S. Court of Appeals — Third Circuit
    • September 10, 1953

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