Steere Tank Lines, Inc. v. I.C.C.
| Decision Date | 19 September 1983 |
| Docket Number | Nos. 81-4293,81-4326 and 81-4396,s. 81-4293 |
| Citation | 714 F.2d 1300 |
| Parties | STEERE TANK LINES, INC., Petitioner, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents. |
| Court | U.S. Court of Appeals — Fifth Circuit |
Hugh T. Matthews, Dallas, Tex., for petitioner.
Colleen J. Bombardier, Sidney L. Strickland, Jr., ICC, Robert B. Nicholson, James H. Laskey, Attys., U.S. Dept. of Justice, Washington, D.C., for respondents.
Edward J. Kiley, Washington, D.C., for Truck Transport Inc. intervenor for petitioner.
Clyde N. Christey, Topeka, Kan., for Keim Transp. Inc., intervenor for respondents.
Petitions for Review of Orders of the Interstate Commerce Commission.
Before BROWN, GEE and JOLLY, Circuit Judges.
With hope, this case will signal the demise of a virulent strain of ICC cases which has recently plagued the motor carrier industry. Frequent outbreaks have occurred over the last two years 1 leaving trucking firms languishing with ailing certifications. Once again, this Court faces a possible epidemic of infirm certificates and swollen transportation authority this time involving Keim Transportation, Inc. (Keim), Energy Carriers, Inc. (Energy Carriers), 2 and Scheduled Truckways, Inc. (Scheduled). 3 According to the petitioner, Steere Tank Lines, Inc. (Steere), the removal of all or part of their requested and granted authority is the only remedy. The Interstate Commerce Commission, on the other hand, gave the group a clean bill of health. Thus, Steere now seeks a second opinion from this Court. Our own examination of these cases reveals that, although some surgery is required, the ICC's diagnosis was supported by substantial evidence. We affirm in part and remand.
Just as medical complaints can often be traced to a single virus or trauma, the origins of these cases may be found in a single act of Congress--the Motor Carrier Act of 1980. 4 Section 5 of the Act, of primary importance here, was enacted to make it easier for new trucking companies to enter the market and for existing ones to expand their operations. 5
Traditionally, persons wanting to enter the business of furnishing interstate transportation for hire as motor common carriers were required to demonstrate not only that they were "fit, willing and able" to provide the transportation to be authorized, but also that the operations for which such authority was sought were required "by the present or future public convenience and necessity." 49 U.S.C. § 10922(a)(2). Congress entrusted the definition of "public convenience and necessity" to the Commission which set forth its interpretation in Pan American Bus Lines Operations, 1 MCC 190, 203 (1936):
The question, in substance, is whether the new operation or service will serve a useful public purpose, responsive to a public demand or need; whether this purpose can and will be served as well by existing lines or carriers; and whether it can be served by applicant with the new operation or service proposed without endangering or impairing the operations of existing carriers contrary to the public interest.
Since 1936, the ICC has chipped away at its initial requirements. In Ex Parte No. MC-121, Policy Statement on Motor Carrier Regulation, 44 Fed.Reg. 60296 (Oct. 19, 1979), for example, the Commission excised the requirement that the adequacy of existing service be a factor in considering applications. 6
In adopting the Motor Carrier Act of 1980, Congress finally rejected the historical approach altogether. House Report, supra note 5, at 14.
In Section 10922(b)(1) (West Supp.1982) of the MCA, 7 Congress set forth the entry standards to be used by the Commission to decide whether or not to issue a certificate authorizing operation as a motor common carrier of property. The Act retains the traditional requisite that all applicants must be fit, willing and able. It revises, however, the public convenience and necessity requirement. Specifically, it reduces the burden of proof on persons supporting the application. Under this standard, proponents of the application must show only that the service they propose will serve a useful public purpose, responsive to a public demand or need. See House Report, supra note 5, at 14. See also Kenosha Auto Transport Corp. v. United States, 684 F.2d 1020, 1027-28 (D.C.Cir.1982) for a discussion of Senate debate on the MCA. If the Commission finds that the carrier has made a prima facie showing to such effect, it will grant the certificate unless protesting carriers show that the transportation to be authorized by the certificate is inconsistent with the public convenience and necessity. 49 U.S.C. § 10922(b)(1). Steere Tank Lines, [No. 81-4497] 687 F.2d at 105; Steere Tank Lines, [No. 81-4261] 675 F.2d at 104; American Trucking Associations, 659 F.2d at 469-70.
It was under the new standards of the 1980 Act that Keim and Energy Carriers filed applications for expanded transportation authority.
Keim sought authority to transport
(1) Gypsum, gypsum products, building materials, paper and paper products, chemicals and plastic products and
(2) Materials, equipment and supplies used in the manufacture, installation, distribution and sale of the commodities in (1) above, between points and places in the United States, except Alaska and Hawaii.
At the time of its application, Keim had authority to operate as a motor carrier transporting iron and steel articles (except "Mercer" and earth drilling commodities) over irregular routes from points in the commercial zones of Sterling and Chicago, Illinois, and Union, Missouri, to points in Kansas, under continuing contract(s) with Steel Pipe & Supply, Inc., of Manhattan, Kansas. See Keim Transportation, Inc., ICC Permit MC-148548 (Sub 1F).
In this capacity, Keim operated 59 tractors and 85 trailers. It operated no tank vehicles. According to the supporting affidavit of Keim's President, Glen Keim, all of the tractors operated by Keim were suitable for the transportation of the commodities described in the application. He pointed out that the 44 flatbed trailers were equipped with removable sides, boomers, chains and tarps and were therefore suitable for the transportation of most of the commodities involved. In addition, Glen Keim suggested that the company's grain trailer and end-dump hydraulic trailer could be used for bulk materials. Glen Keim stated that Keim was in compliance with and would continue to comply with ICC rules and regulations.
One shipper, Georgia-Pacific Corporation (Georgia-Pacific) supported the application. 8 At the time of Keim's application, it served Georgia-Pacific out of its (Georgia-Pacific's) plants at Blue Rapids, Kansas; Cuba, Missouri; and Acme, Texas. Georgia-Pacific cited the inability of present carriers to provide an adequate supply of equipment during peak building and construction periods as one reason for its support. It contended that there existed an urgent need for responsive, economic motor carriage to be supplied with consistent service over extended periods of time. In addition, Georgia-Pacific expressed a need for a shipper which would be able to provide for its specialized service needs. 9
Georgia-Pacific predicted that it would tender 10 to 50 truckloads per week to Keim, depending on the carrier's capacity. It named no specific representative destinations or origins of its traffic but stated only "points in the United States." Keim points out in its brief, however, that Georgia-Pacific has at least two facilities in each of the 48 contiguous states.
Keim's application sent its potential competitors scurrying to the Commission for Keim-otherapy. 10 They complained of diversion of shipper traffic, 11 economic depression in the motor carrier industry in general, and other individual adverse economic consequences resulting from the granting of authority to Keim. In addition, the protestants argued that Keim was not in a position to perform the nationwide service proposed. To alleviate their suffering, the protestants asked that the Commission (i) limit Keim's authority to the shipper's facilities, (ii) deny Keim's certification altogether because it had not met its burden of proof under the Motor Carrier Act or, (iii) if it had met its burden, find that the protestants had overcome Keim's showing by evidence of their own.
Despite the protests, the Commission found that Keim had met its more relaxed burden of proof under the Motor Carrier Act that the service proposed would serve a useful public purpose, responsive to a public demand or need. It determined that the granting of authority to Keim would improve Georgia-Pacific's competitive posture and enable it to expand its market. Moreover, it concluded that a grant would offer the shipper a broader choice of carriers for meeting its transportation needs and help assure the availability of sufficient vehicles when needed. It pointed out that the protestants individually and collectively were unable to provide the shipper with the degree of service proposed by Keim and had not shown that "piecemeal fragmentation of the application to protect their interest is tantamount to the public interest." Keim Extension, supra note 11, at 5.
The Commission rejected the protestants' suggestion that a grant of common carrier authority to Keim be restricted to service for its supporting shipper only. It pointed out that the protestants had shown no likely adverse effects from...
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Steere Tank Lines, Inc. v. I.C.C.
...convenience and necessity and the burden of proof is shifted to the protestants to show that it will not. Steere Tank Lines, Inc. v. ICC, 714 F.2d 1300, 1303 (5th Cir.1983) (Steere V ); C & H Transportation Co., Inc. v. ICC, 704 F.2d 834, 842 (5th Cir.1983); J.H. Rose Truck Line, 683 F.2d a......