Union Elec. Co. v. U.S., s. 79-1844
| Decision Date | 16 July 1980 |
| Docket Number | 80-1015 and 80-1089,79-1920,79-1898,79-1921,79-1972,Nos. 79-1844,s. 79-1844 |
| Citation | 626 F.2d 1348 |
| Parties | UNION ELECTRIC COMPANY, Missouri Public Service Company; American Electric Power Service Corporation and Wisconsin Electric Power Company, Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Abilene & Southern Railway Company et al., Intervenors-Respondents. NATIONAL ASSOCIATION OF RECYCLING INDUSTRIES, INC., Petitioner, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents, Abilene & Southern Railway Company et al., Intervenors. SYSTEMS FUEL, INC., Arkansas Power & Light Company and Potomac Electric Power Company, Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. CELANESE CHEMICAL COMPANY, INC., Arizona Electric Power Cooperative, Inc., Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. NORTH DAKOTA STATE WHEAT COMMISSION and North Dakota Public Service Commission, Petitioners, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents, Abilene & Southern Railway Company et al., Intervenors-Respondents. NATIONAL INSULATION TRANSPORTATION COMMITTEE, Petitioner, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents, Abilene & Southern Railway Company et al., Intervenors-Respondents. CONSUMERS POWER COMPANY, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondent, Abilene & Southern Railway Company et al., Intervenors-Respondents. |
| Court | U.S. Court of Appeals — Eighth Circuit |
Charles J. McCarthy, Belnap, McCarthy, Spencer, Sweeney & Harkaway, Edward Merrigan and Charles W. Chapman, Washington, D.C., for petitioners.
H. Glenn Scammel, Atty., I. C. C., Washington, D.C., for respondent, I. C. C Richard Flynn, Sidley & Austin, Washington, D.C., for respondents.
Before LAY, Chief Judge, HENLEY, Circuit Judge, and HANSON, * Senior District Judge.
Petitioners in these consolidated cases represent shippers of various commodities whose transportation rates were affected by a general increase in railroad carrier freight charges, effective October 15, 1979. 1 They seek review of the Interstate Commerce Commission's, (ICC), decision not to suspend or investigate the increase before it became effective. Ex Parte 368, Increased Freight Rates and Charges, Nationwide 1979. Before proceeding to the merits, we have limited briefs and argument to the question raised by appellee ICC's motion to dismiss: whether this court has jurisdiction to review the ICC decision and order. We conclude it does not.
On July 26, 1979, all railroads and certain water and motor carriers having joint rates with them petitioned the ICC for authority to file tariff schedules increasing freight rates. The carriers submitted 60 verified statements constituting their evidential case, gave notice and served the petition and statements, and furnished data to the public. See Procedures Governing Rail Carrier General Increase Proceedings, 49 C.F.R. §§ 1102.1-.9 (1979). They also filed an evaluation of environmental considerations, pursuant to ICC Revised Guidelines for Implementation of the National Environmental Policy Act of 1969, 49 C.F.R. §§ 1108.1-.20 (1979).
On August 8, 1979, the ICC granted special permission to publish and file the general increase schedules, or master tariff, as requested. It conditioned permission on the tariff taking effect upon not less than 30 days notice and expiring one year thereafter. The permission was given subject to protest and possible suspension and rejection. All prior ICC orders were ordered modified to the extent necessary to allow the filing.
The August 8th order made all common carriers by rail parties to the proceeding. Noting that the Interstate Commerce Act, 49 U.S.C.A. § 10707(c) (Supp.1979), requires filing verified complaints seeking suspension of proposed rate changes, the ICC required any person opposing the increase to file verified statements containing all relevant evidence the party wished the ICC to consider by September 6, 1979. Comments on environmental impact and presidential wage and price guidelines were specifically invited. The carriers were given until September 12th to file and serve replies and rebuttal evidence.
On October 5, 1979, the ICC issued a second decision and order. It concluded that, with one exception, "the record in this proceeding warrants that the Commission decline to suspend or investigate the proposed increase." The order was conditioned upon postponement of the effective date to October 15, 1979.
The ICC based its decision not to suspend the master tariff as a whole upon its finding that the proposed revenue increase was justified by increased railroad costs. 2 It also found requirements of the National Environmental Policy Act of 1969, 42 U.S.C. § 4321 (NEPA), and the presidential wage and price guidelines were met.
The decision mentioned three specific commodity groups. The increase for iron or steel scrap was the exception to the general order: it was ordered suspended and placed under investigation for a consolidated decision with another proceeding. The ICC allowed the general rate increases for recyclables on the condition that criteria of reasonableness and discrimination, established in an earlier, special investigation of recyclable rates, be met. The ICC also refused to exclude special grain tables from the master tariff.
North Dakota Wheat Commission, (domestic and export grain), Union Electric Company, Consumers Power Company, Systems Fuel Inc., and Celanese Chemical Company, (coal), confine their challenge to the percentage by which the increase on their particular commodity exceeds the average nationwide or region-wide general increases. These petitioners request remand to the ICC with instructions to reconsider and make proper, adequate findings on the reasonableness of the increase as applied to their commodities. We first consider reviewability of the order in the context of their allegations.
The determinative issue is whether the ICC's action was a refusal under 49 U.S.C. § 10707(a) 3 to investigate lawfulness or in the language of the revised Act, to begin a proceeding to determine whether the proposed rate violated the Interstate Commerce Act. If it was, the recent decision by the United States Supreme Court in Southern Railway v. Seaboard Allied Milling Corp., 442 U.S. 444, 99 S.Ct. 2388, 60 L.Ed.2d 1017 (1979), teaches that it is unreviewable.
In Seaboard, a group of railroads filed a seasonal demand rate increase. See 49 U.S.C. § 10727. Shippers petitioned the ICC for suspension and investigation of the increases' lawfulness under what is now section 10707(a) of the Act. 4 A month after the rate filing, the ICC declined to suspend or investigate, and the shippers attempted to appeal that decision. The Court held the decision was not a final determination that the tariff was lawful, but rather a nonfinal decision not to investigate lawfulness. Seaboard, 442 U.S. at 452-54, 99 S.Ct. at 2393-94. The Court also held Congress did not intend review of a section 10707 "no investigation" decision, because the statutory language, design and history show the decision is committed to agency discretion. Additionally, the Court reasoned that review of an ICC decision not to suspend or investigate would require an initial, independent appraisal of the reasonableness of the proposed rate. This would conflict with legislative intent to avoid judicial disruption of the administrative rate-making process prior to final decision. Investigation is linked to ICC power to suspend, the Court stated, and prior Supreme Court cases have held suspension decisions are unreviewable. The Court found support for its decision in the disruptive consequences of requiring judicially reviewable decisions on the legality of proposed tariffs in light of the numerous tariff filings, many of which include thousands of individual rates. Judicial review of refusals to investigate before rates become effective would lessen shipper incentive to initiate investigation and to obtain a final ruling on the reasonableness of their particular commodity's rate after it had become effective. See 49 U.S.C. §§ 11701(b), 10704(a)(1). 5
Petitioners' request for review is premised on the assumption that the ICC made a final decision on a complete record after investigation, so Seaboard does not control. They claim the August 8th grant of authority to file a master tariff initiated a proceeding/investigation, an evidentiary record was assembled, and the October 5th decision was final. The decision approved the general increase and was not merely a refusal to suspend and to investigate. Some petitioners admit the ICC did not make a final determination on the lawfulness of the increase. However, they argue the ICC did finally decide on distribution of the increase among various commodity groups. Others argue the ICC finally decided the lawfulness of the general increase i. e., whether general need for increased revenue was shown by the record.
To determine if the ICC order was a refusal to investigate, the Court in Seaboard examined the order's express language in light of the inquiry the ICC makes upon a shipper's request to suspend and investigate a rate increase. We accordingly consider the express language of the October 5th order, mindful that it follows a grant of special permission to file general increase schedules subject to protest and possible suspension.
The order expressly states the record warrants that the Commission "decline to suspend or investigate the proposed increase." The order contains one exception: the increase proposed for iron or steel scrap on certain routes was...
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