Source: http://openjurist.org/660/f2d/225/gibbons-v-united-states
Timestamp: 2017-07-25 13:24:46
Document Index: 525006155

Matched Legal Cases: ['§ 11125', '§ 11123', '§ 551', '§ 10321', '§ 11125', '§ 706', '§ 706', '§ 11123']

660 F. 2d 225 - Gibbons v. United States HomeFederal Reporter, Second Series 660 F.2d.
Achievement of the Commission's purpose preservation of a national transportation system and provision of transportation for the people and industries of the Midwest was directly threatened in late March 1980. Because the Rock Island was cashless, the Commission could not order it to operate. In re Chicago, Milwaukee, St. Paul and Pacific R.R. Co., 611 F.2d at 669. Further, federal subsidies under section 11125 were exhausted in late March. Without these subsidies, the ICC could not force another carrier to operate over the Rock Island. 49 U.S.C. § 11125. The ICC first attempted to solve the crisis by authorizing the same carriers to operate over the Rock Island, with compensation, under 49 U.S.C. § 11123(a)(2) and (a)(4). But that effort was halted when this Court ruled that the Commission could only authorize use of cars, but not lines, under sections 11123(a)(2) and (a)(4). Atchison, Topeka & Santa Fe Rwy. v. United States, 617 F.2d 485 (7th Cir. 1980). Further Congressional action was widely recognized to be forthcoming, but not in time. The ICC had no other express powers to deal with the crisis. The Rock Island would shut down.
The Commission's orders here were directly related to its express powers to direct service. We find the exercise of the ICC's power here "to be a legitimate, reasonable, and direct adjunct to the Commission's explicit statutory power." United States v. Chesapeake & Ohio R.R. Co., 426 U.S. 500, 514, 96 S.Ct. 2318, 2325, 49 L.Ed.2d 14 (1976). Compare, Atchison, Topeka & Santa Fe Rwy. Co. v. I.C.C., 607 F.2d 1199, 1203, (7th Cir. 1979) (statutory authority to publish "rates, fares, and charges" does not include power to publish operating schedules.10
SSW states Chesapeake dealt with the Commission's power to suspend rates. True enough, but nothing in the opinion suggests it applied only to that power. As held in the subsequently decided Trans Alaska Pipeline Rates Cases, 436 U.S. 631, 655-56, 98 S.Ct. 2053, 2066-67, 56 L.Ed.2d 591 (1978), the orders
(Quoting 426 U.S. at 514, 96 S.Ct. at 2325.)
We now review the merits of the ICC's compensation orders. The Commission's actions under section 11125 are exempted from the rulemaking procedures of both the Administrative Procedure Act, 5 U.S.C. §§ 551-559, and the Interstate Commerce Act, 49 U.S.C. §§ 10321-10330; 49 U.S.C. § 11125(a); see n.5, supra. Accordingly, its orders are not governed by the "substantial evidence on the record" test. 5 U.S.C. § 706(2)(E). The Commission's orders must be upheld if they were not arbitrary, capricious, or an abuse of discretion. 5 U.S.C. § 706(2)(A); Camp v. Pitts, 411 U.S. 138, 140-41, 93 S.Ct. 1241, 1243, 36 L.Ed.2d 106 (1973); Bowman Trans., Inc. v. Arkansas-Best Freight System, 419 U.S. 281, 285-86, 95 S.Ct. 438, 441-42, 42 L.Ed.2d 447 (1974). In determining whether the Commission's actions were arbitrary or capricious, the court
In re Penn Central Transportation Co., 440 F.Supp. 569, 575 (E.D.Pa.1977).
SSW Commission Appeal, 336 I.C.C. at 256. These benefits must have been evident to SSW, as it offered to pay $57 million to buy the Tucumcari line. The Commission gave adequate reasons for departing from its prior precedent. Chicago & Northwestern Transp. Co. v. United States, 582 F.2d 1043, 1060 (7th Cir. 1978); Greyhound Corp. v. I.C.C., 551 F.2d 414 (D.C.Cir.1977).
The orders here were issued under admittedly hurried conditions. SSW and the Trustee argue nevertheless that the Commission's formula was arbitrary because it did not take into consideration the circumstances of each line. But the ICC was entitled to find a formula which it would apply to several carriers. See, e. g., Chicago & Northwestern Rwy. Co. v. Atchison, Topeka & Santa Fe Rwy. Co., 387 U.S. 326, 340-42, 87 S.Ct. 1585, 1593-94, 18 L.Ed.2d 803 (1967) (Commission entitled to make findings on a group basis for rate divisions). The ICC could properly conclude that compensation for this two month period should not be tied to the circumstances of each line. If it were, the almost-certain long delay before the ICC might have doomed directed service before it began. Id. at 342, 87 S.Ct. at 1594. Frisco, for one, stated it would not begin directed service until it had a definite answer on the amount of compensation. Application of St. Louis-San Francisco Railway Company to Perform Temporary Emergency Operation over Various Lines of the Chicago, Rock Island and Pacific Railroad Company (March 11, 1980) at 4-5. Accordingly, it was no abuse of discretion for the agency to refer to two "sample" leases in setting out the base rental.
In saying this, we do not mean to endorse the Commission's approach. Compare National R.R. Passenger Corp. v. I.C.C., 610 F.2d 865, 879 (D.C.Cir.1979); National R.R. Passenger Corp. v. I.C.C., 610 F.2d 881, 886 (D.C.Cir.1979). The ICC is not an arbitrator. The Commission's willingness to characterize itself as one only encourages the parties to take unreasonable positions. We hold only that, under the circumstances, the ICC acted within its proper authority in formulating the Frisco, RTA, and Memphis-Fordyce compensation orders.
The Commission's order concerning the Tucumcari line was also not arbitrary and capricious. The ICC's decision took into account the value of the line, a reasonable rate of return to Rock Island, and the amount of SSW's expenditures for upkeep of the line. The ICC thus took into consideration all the relevant factors and the benefits and burdens on each party. Citizens to Preserve Overton Park v. Volpe, 401 U.S. 402 at 416, 91 S.Ct. 814 at 823, 28 L.Ed.2d 136.
49 U.S.C. § 11123(a)(3) provides:
(3) require joint or common use of terminals, including mainline tracks for a reasonable distance outside of those terminals, on terms of compensation the carriers establish between themselves, subject to subsection (b)(2) of this section, when that action will best meet the emergency and serve the public interest.
(b)(1) Action of the Commission under subsection (a) of this section may not remain in effect for more than 60 days. However, the Commission may extend that period for an additional designated period of not more than 180 days if cause exists.