United Transp. Union v. I.C.C.

• Decision Date: 28 November 1989
• Docket Number: No. 88-1773,88-1773
• Citation: 891 F.2d 908
• Parties: , 58 USLW 2336 UNITED TRANSPORTATION UNION, Petitioner, v. INTERSTATE COMMERCE COMMISSION and United States of America, Respondents, Association of American Railroads, Intervenor.
• Court: U.S. Court of Appeals — District of Columbia Circuit

Page 908

891 F.2d 908

282 U.S.App.D.C. 38, 58 USLW 2336

UNITED TRANSPORTATION UNION, Petitioner, v. INTERSTATE COMMERCE COMMISSION and United States of America,

Respondents,

Association of American Railroads, Intervenor.

No. 88-1773.

United States Court of Appeals, District of Columbia Circuit.

Argued Sept. 18, 1989.

Decided Nov. 28, 1989.

Gordon P. MacDougall, for petitioner.

Evelyn G. Kitay, Atty., I.C.C., with whom Robert S. Burk, General Counsel, Henri F. Rush, Deputy General Counsel, I.C.C., James F. Rill, Asst. Atty. Gen., Catherine G. O'Sullivan, Atty., Dept. of Justice, Washington, D.C., were on the joint brief, for respondents.

Kenneth P. Kolson, Vienna, Va. and Dennis W. Wilson were on the brief, for intervenor. G. Paul Moates, Washington, D.C., David M. Levy and J. Thomas Tidd, Washington, D.C., also entered appearances for intervenor.

Before RUTH BADER GINSBURG, SILBERMAN and D.H. GINSBURG, Circuit Judges.

Opinion for the Court filed by Circuit Judge SILBERMAN.

Opinion concurring in denying the petition for review filed by Circuit Judge RUTH BADER GINSBURG.

SILBERMAN, Circuit Judge:

This is a petition brought by the United Transportation Union ("UTU"), ¹ seeking review of the Interstate Commerce Commission's ("ICC") decision to adopt a rule that exempts the officers and directors of certain rail carriers from obtaining prior approval for interlocking directorates under 49 U.S.C. § 11322(a). See Exemption from 49 U.S.C. 11322(a) for Certain Interlocking Directorates, 5 I.C.C.2d 7 (1988). We hold that the petitioner lacks standing, ² and therefore dismiss the petition for review.

I.

In the Staggers Rail Act of 1980, ³ Congress gave the ICC broad responsibilities for deregulating the nation's railroads. One section of that Act, 49 U.S.C. § 10505, directs the ICC to exempt a transaction or class of transactions from regulation when the Commission finds that (1) regulation is not necessary to carry out the 15-factor national rail transportation policy (RTP) articulated in 49 U.S.C. § 10101a; ⁴ and (2) either (a) the transaction is of limited scope, or (b) regulation is not needed to protect shippers from the abuse of market power. The legislative history of 49 U.S.C. § 10505 indicates that Congress expected the ICC to use its exemption authority to remove "as many as possible of the Commission's restrictions on charges in prices and services by rail carriers ... and ... adopt a policy of reviewing carrier actions after the fact to correct abuses of market power." H.R.REP. No. 1430, 96th Cong., 2d Sess. 105, reprinted in 1980 U.S.CODE CONG. & ADMIN.NEWS 3978, 4110, 4137. See also Illinois Commerce Comm'n v. ICC, 848 F.2d 1246, 1249 (D.C.Cir.1988), cert. denied, --- U.S. ----, 109 S.Ct. 783, 102 L.Ed.2d 775 (1989).

Pursuant to that congressional direction, the ICC published, in April of 1988, a notice of proposed rulemaking that would exempt all interlocking directorates between two railroads--except those involving two "class I" railroads ⁵--from complying with the requirements of 49 U.S.C. § 11322(a). See Certain Interlocking Directorates; Exemption, 53 Fed.Reg. 12,443 (1988). Section 11322(a), originally enacted as part of the Transportation Act of 1920, ch. 91, § 439, 41 Stat. 496 (1920), prohibits any person from serving as a director or officer of more than one rail carrier unless the ICC has determined that "public or private interests will not be adversely affected." ⁶ The proposed rule--by replacing the case-by-case approval system with blanket approval--was designed to eliminate the expense and delay accompanying individual applications. Since the ICC had not rejected an application for an interlocking directorate in nearly twenty years and since no decision to approve an application had ever been challenged by any party, the ICC viewed prior approval as unnecessary. After receiving comments on the proposed rule, including those submitted by the petitioner, the Commission adopted the rule. See Exemption from 49 U.S.C. 11322(a) for Certain Interlocking Directorates, 5 I.C.C.2d 7 (1988).

In its accompanying explanation, the Commission explained its determination that the rule satisfied the requirements for granting exemptions set out in 49 U.S.C. § 10505(a). It first asserted that the exemption promoted several of the fifteen factors that comprise the national rail transportation policy, finding that the exemption "minimize[s] the need for federal regulatory control and expedite[s] regulatory decisions [49 U.S.C. § 10101a(2) ]; ensure[s] continuation of a sound rail system [49 U.S.C. § 10101a(4) ]; foster[s] sound economic conditions in transportation [49 U.S.C. § 10101a(5) ]; and encourage[s] honest and efficient management [49 U.S.C. § 10101a(10) ]." 5 I.C.C.2d at 11. The Commission also agreed with the comments that contended that, by enabling new carriers to recruit talented and experienced personnel from existing carriers, the exemption would reduce barriers to entry in the industry in furtherance of 49 U.S.C. § 10101a(7). Finally, it believed that none of the other policy goals listed in 49 U.S.C. § 10101a would be adversely affected by the rule. See id. at 12-13.

The ICC then concluded that the rule satisfied both of the two alternative tests of § 10505(a)(2)--that the exemption is of limited scope and that the prior approval requirements of § 11322(a) are not needed to protect shippers from the abuse of market power. Its scope is "limited" because the exemption will not apply to interlocks between two class I carriers and the substantive provisions of § 11322(b), prohibiting certain actions by interlocking officers and directors, are not affected by the rule. And shippers do not need the protection of § 11322(a), according to the ICC, because the small size of class II and class III railroads and the vigorous competition present in the transportation industry made it "highly unlikely for any linkage to succeed in allowing one carrier to dominate or influence the other carrier contrary to the other rail carrier's or shipper's interests." 5 I.C.C.2d at 12. The Commission noted that "no shippers chose to file comments" opposing the rule, thereby suggesting that they did not fear any abuse of market power from interlocking directorates. See id. at 14.

The petitioner argues that the ICC's decision is inconsistent with § 10505(a) and that it is arbitrary and capricious. The government challenges petitioner's standing on both prudential and constitutional grounds. Our colleague--apparently of the view that the standing issue is too difficult to resolve--believes we should pass on to the merits without deciding whether we have the constitutional authority to hear the case. To be sure, this court has on occasion followed that course, although not often in recent times, but we are unaware of any case where a panel was criticized for not employing that technique; in other words, for assuming its constitutional obligation. Here the parties have briefed the standing issue and we have accordingly done our best to answer the jurisdictional question raised. It is hard to understand why, under these circumstances, it could be thought a judicial virtue not to do so.

II.

To satisfy the standing requirements of Article III, a complaining party must "show that he personally has suffered some actual or threatened injury as a result of the putatively illegal conduct of the defendant, ... and that the injury fairly can be traced to the challenged action and is likely to be redressed by a favorable decision." Valley Forge Christian College v. Americans United for Separation of Church and State, Inc., 454 U.S. 464, 472, 102 S.Ct. 752, 758, 70 L.Ed.2d 700 (1982) (internal quotes and citations omitted). "The injury alleged must be ... distinct and palpable, ... and not abstract or conjectural or hypothetical." Allen v. Wright, 468 U.S. 737, 751, 104 S.Ct. 3315, 3324, 82 L.Ed.2d 556 (1984) (internal quotes and citations omitted).

We are mindful that in analyzing standing issues, we "must accept as true all material allegations of the complaint," Warth v. Seldin, 422 U.S. 490, 501, 95 S.Ct. 2197, 2206, 45 L.Ed.2d 343 (1975). This obligation, at least at first blush, might appear to be in tension with the Court's further admonition that an allegation of injury or of redressability that is too speculative will not "suffice to invoke the federal judicial power." Simon v. Eastern Kentucky Welfare Rights Org., 426 U.S. 26, 44, 96 S.Ct. 1917, 1927, 48 L.Ed.2d 450 (1976); accord Warth, 422 U.S. at 507, 95 S.Ct. at 2209. We think this ostensible tension is reconciled by distinguishing allegations of facts, either historical or otherwise demonstrable, from allegations that are really predictions. When considering any chain of allegations for standing purposes, we may reject as overly speculative those links which are predictions of future events (especially future actions to be taken by third parties) and those which predict a future injury that will result from present or ongoing actions--those types of allegations that are not normally susceptible of labelling as "true" or "false." Our authority to reject as speculative allegations of future injuries is well-established. See Los Angeles v. Lyons, 461 U.S. 95, 103 S.Ct. 1660, 75 L.Ed.2d 675 (1983); O'Shea v. Littleton, 414 U.S. 488, 94 S.Ct. 669, 38 L.Ed.2d 674 (1974); Golden v. Zwickler, 394 U.S. 103, 89 S.Ct. 956, 22 L.Ed.2d 113 (1969). ⁷ In Lyons, the Supreme Court reviewed the claim of an individual who alleged that he had been injured by an unjustified "chokehold" administered to him by a Los Angeles police officer and that he "justifiably fears that any contact he has with Los Angeles Police officers may result in his being choked and strangled to death ..." 461 U.S. at 98, 103 S.Ct. at 1663. The Court dismissed on Article III grounds the complainant's prayer for an injunction forbidding the use of such chokeholds by police officers, finding...