Transamerican Trailer Transp., Inc. v. FEDERAL MAR. COM'N
| Decision Date | 28 January 1974 |
| Docket Number | 24044,72-1763,72-1766.,24831,No. 24019,72-1714,72-1740,24019 |
| Citation | 492 F.2d 617 |
| Parties | TRANSAMERICAN TRAILER TRANSPORT, INC., Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, New York Shipping Association, Inc., and Walleniusrederiena, United Fruit Company, Intervenors. COMMONWEALTH OF PUERTO RICO, Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, New York Shipping Association, Inc., Intervenor. WOLFSBURGER TRANSPORT-GESELLSCHAFT, m.b.H., Petitioner v. FEDERAL MARITIME COMMISSION and United States of America, Respondents Walleniusrederiena ("Wallenius Line") et al., Intervenors. NEW YORK SHIPPING ASSOCIATION, Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, Commonwealth of Puerto Rico et al., Intervenors. SEATRAIN LINES, INC., Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, New York Shipping Association, Inc., Intervenor. SEA-LAND SERVICE, INC., Petitioner, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, New York Shipping Association, Inc., Intervenor. DANIELS & KENNEDY, INC., and the Madden Corporation, Petitioners, v. FEDERAL MARITIME COMMISSION and United States of America, Respondents, New York Shipping Association, Inc., Intervenor. |
| Court | U.S. Court of Appeals — District of Columbia Circuit |
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Ronald A. Capone, Washington, D.C., with whom Stuart S. Dye, Washington, D.C., was on the brief for petitioner in No. 24,019, also argued for petitioners in Nos. 72-1740 and 72-1763. Russell T. Weil, Washington, D.C., and John Williams entered appearances for petitioner in No. 24,019 and intervenor Transamerican Trailer Transport Inc., in Nos. 24,831 and 72-1714. Ronald A. Capone, Washington, D.C., also entered an appearance for intervenor Transamerican Trailer Transport, Inc. Mario F. Escudero, Washington, D.C., for petitioner in No. 24,044 also entered an appearance for intervenor, The Commonwealth of Puerto Rico, in Nos. 24,831 and 72-1714.
Philip Elman, Washington, D.C., for petitioner in No. 24,831 also entered an appearance for intervenor Wolfsburger Transport-Gesellschaft, m.b.H. in No. 72-1714.
C. P. Lambos, New York City, for petitioner in No. 72-1714. Wayne S. Bishop, Washington, D.C., entered an appearance for intervenor, New York Shipping Assn., Inc., in Nos. 24-019, 24,044, 72-1740, 72-1763 and 72-1766. Richard Brook, New York City, also entered an appearance for intervenor New York Shipping Assn., Inc., in No. 24,831.
Joseph F. Kelly, Jr., New York City, for petitioners in No. 72-1766 also entered an appearance for intervenors Daniels & Kennedy and The Madden Corp. in No. 72-1714. James A. Treanor, Washington, D.C., entered an appearance for petitioner in No. 72-1766.
Carl D. Lawson, Atty., Dept. of Justice, for respondents. James L. Pimper, Gen. Counsel, Federal Maritime Commission, Edward G. Gruis, Deputy Gen. Counsel, Paul J. Fitzpatrick, Atty., Federal Maritime Commission, and Irwin A. Seibel, Atty., Dept. of Justice, were on the brief, for respondent.
Marvin J. Coles and Neal M. Mayer, Washington, D.C., were on the brief for petitioner in No. 72-1740. Neal M. Mayer, Washington, D.C., also entered an appearance for intervenor Seatrain Lines, Inc., in Nos. 24,831 and 72-1714.
Gerald A. Malia, Washington, D.C., was on the brief for petitioner in No. 72-1763.
Alan F. Wohlstetter, Washington, D.C., was on the brief for intervenor Walleniusrederiena in Nos. 24,019, 24,831 and 72-1714 and also entered an appearance for intervenor United Fruit Company in No. 24,019 and intervenor United Brands Company in No. 72-1714.
Before WRIGHT, McGOWAN and WILKEY, Circuit Judges.
These consolidated petitions to review orders of the Federal Maritime Commission, 28 U.S.C. § 2342 (1966), have their origins in the modernization of shipping and loading facilities in the Port of New York. At issue here is the propriety of the Commission's approval, as modified by it, of the New York Shipping Association's assessment agreement T-2390. That agreement was designed to allocate some of the costs of a labor accord reached between the International Longshoremen's Association and NYSA, the latter acting on behalf of both member and non-member employers in the Port of New York.
NYSA is a multi-employer bargaining unit, comprised of ocean carriers, operators of vessels calling at the Port of New York, and contracting stevedores and other employer groups generally associated with loading, unloading, and handling of oceangoing ships and their cargoes. Some of the petitioners before this court are not members of NYSA. They are nonetheless directly affected by the allocation agreement because the cost of the membership assessment is reflected in their loading costs in the Port. They participated in the proceedings before the Commission, and clearly have standing to seek review in this court.
The diverse and contradictory positions advanced by petitioners reveal the difficulty of allocating the labor costs of a modernizing industry in a manner that satisfies all parties. The increased fringe benefit costs, in part a reflection of the union's concern that port modernization will lead to excessive job displacement, must be divided among a group of employers whose labor productivity varies significantly. In this context, precise calculations are elusive, and absolute equity is beyond concrete demonstration. At best, the assessment agreement must represent a compromise of sorts. Cf. Volkswagenwerk Aktiengesellschaft v. Federal Maritime Commission, 390 U.S. 261, 293, 88 S.Ct. 929, 19 L.Ed.2d 1090 (1968) (Harlan, J., concurring). The Commission, itself a recent initiate to the complex problems presented by agreements of this kind, must exercise its statutory authority to assure that the agreements do not violate the mandates of the Shipping Act, 46 U.S.C. § 801 et seq. (1964). This court must in turn determine whether the Commission has operated within its proper statutory powers and by rational reference to substantial evidence in the record before it. In this instance we are persuaded that it has; and we affirm.
The assessment agreement is an attempt to allocate the costs of the modernization of port loading facilities.1 This so-called "containerization revolution" is characterized by the increasing use of more efficient methods of cargo handling in the maritime industry. Containerization has aroused the concern of the union, which looks upon these methods of cargo handling as a threat to job security. Thus, the rise of containerization was paralleled by a rise of labor unrest. Containerization began to affect Port of New York labor relations in the late fifties, and labor strife infested the Port throughout the decade of 1958-1968. The labor agreement with the union, which gave rise to T-2390, covered the years 1968-1971. It came at the end of a lengthy strike, and was itself but one more step in the battle over this issue.2
The NYSA membership unanimously ratified the labor contract with ILA which underlay T-2390, but with a general understanding among themselves that the Association would develop a formula that would cause a reallocation of the fringe benefit assessment to transfer some of the costs of the concessions from the less efficient breakbulk operators to the innovative carriers. At that point, however, unanimity ended; and the creation of an allocational formula that satisfies all parties has been a continuing source of dispute. T-2390, itself a compromise solution that was the product of repeated NYSA efforts,3 was finally adopted by the NYSA membership by a vote of 58-3.
The purpose of T-2390 was to provide a means of financing the cost of fringe benefit concessions contained in the ILA agreement.4 NYSA had previously allocated these kinds of costs by a formula that charged members on the basis of man-hours of labor employed. But the same modernization process that prompted the concession of new fringe benefits in the underlying ILA contract also necessitated the creation of a new method of assessing NYSA members. Although the previous allocational formula had worked fairly when most of the members utilized similar loading methods and had similar labor productivities, the man-hours formula began to impose an increasingly disproportionate burden on the traditional breakbulk cargo handlers as more employers turned to more innovative methods of cargo handling. NYSA therefore resolved to discontinue the old system. An assessment committee was created for the purpose of devising a new method of allocating these costs, and, after two previous attempts to reach an acceptable solution, supra note 3, the committee proposed T-2390.
Agreement T-2390 established a combined man-hour and tonnage formula for raising funds to pay for certain fringe benefit costs of the ILA contract. One part of the assessment, based exclusively on man-hours of labor employed, was designed to cover expenses remaining from the previous labor contract which expired in 1968. The second component of the formula levied assessments on the basis of a specified amount per ton of cargo. As the amount of total liability under the labor contract was only a prediction, allowance was made for the establishment of greater tonnage assessment if that became necessary to cover all costs.
Prior to Volkswagenwerk Aktiengesellschaft v. Federal Maritime Commission, 390 U.S. 261, 88 S.Ct. 929, 19 L.Ed.2d 1090 (1968), it was widely believed that the Commission's jurisdiction did not extend to these assessment agreements. In Volkswagen the Court announced that Section 15 of the Shipping Act did confer jurisdiction over these agreements, and spoke in broad terms concerning the Commission's...
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