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Matched Legal Cases: ['§ 15', '§ 15', '§ 15', '§ 15', '§ 1', '§ 15', '§ 15', '§ 1', '§ 1', '§ 1', '§ 6', '§ 6', '§ 6', '§ 15', '§ 6', '§ 15', '§ 418', '§ 15', '§ 6', '§ 6', '§ 6', '§ 1300', '§ 15', '§ 15', '§ 6', '§ 1651', '§ 15', '§ 15', '§ 15', '§ 316', 'art, 311']

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Trans Alaska Pipeline Rate Cases 436 U.S. 631 (1978)
U.S. Supreme CourtTrans Alaska Pipeline Rate Cases, 436 U.S. 631 (1978)Trans Alaska Pipeline Rate Cases Nos. 77-452, 77-457 and 77-602Argued March 28, 1978Decided June 6, 1978436 U.S. 631CERTIORARI TO THE UNITED STATES COURT OF APPEALS
2. The ICC has power ancillary to its suspension authority under Page 436 U. S. 632 § 15(7) to establish, without an adjudicatory hearing, maximum interim rates which it would allow to go into effect during the suspension period. By so establishing such interim rates here, the ICC did not exceed its suspension power but, to the contrary, performed an intelligent and practical exercise of its suspension power in accord with Congress' goal in § 15(7) to strike a fair balance between the needs of the public and the needs of regulated carriers. Pp. 436 U. S. 651-654.
BRENNAN, J., delivered the opinion of the Court, in which all other Members joined, except POWELL, J., who took no part in the consideration or decision of the cases. Page 436 U. S. 633
The primary question presented in these cases is whether the Interstate Commerce Commission is authorized by § 15(7) of the Interstate Commerce Act, as added, 36 Stat. 552, and amended, 49 U.S.C. § 15(7), [Footnote 1] to suspend initial tariff schedules of an interstate carrier subject to Part I of the Act, 24 Stat. 379, as amended, 49 U.S.C. §§ 1-27 (1970 ed. and Supp. V). In addition, we are asked to decide whether, if the Commission is so authorized, it has additional authority summarily to fix maximum interim tariff rates which will be allowed to go into effect during the suspension period and to require carriers filing tariffs containing such rates, as a further condition of nonsuspension, to refund any amounts collected which are ultimately found to be unlawful. We hold that the Commission has statutory authority to suspend initial tariff schedules, and that it has power ancillary to that authority to establish maximum interim rates and associated regulations -- including refund provisions -- as it has done in these cases. Page 436 U. S. 634
In 1968, massive reservoirs of oil were discovered at Prudhoe Bay in the Alaskan Arctic. Two years later, plans crystallized to build a pipeline from Prudhoe Bay to the all-weather port of Valdez on Alaska's Pacific coast. After protracted environmental litigation was ended by special Act of Congress, [Footnote 2] construction of the Trans Alaska Pipeline System (TAPS) began in 1974. In May and June, 1977, seven of the eight owners of TAPS, [Footnote 3] anticipating completion of TAPS in mid-1977, filed tariffs with the Interstate Commerce Commission [Footnote 4] setting out the rules and rates governing transportation Page 436 U. S. 635 of oil over TAPS. These rates were met immediately by formal protests [Footnote 5] from the State of Alaska, [Footnote 6] the Arctic Slope Regional Corporation, [Footnote 7] the United States Department of Justice, [Footnote 8] and the Commission's Bureau of Investigations and Enforcement. [Footnote 9]
Acting pursuant to § 15(7) of the Interstate Commerce Act, the Commission [Footnote 10] found that the protests lodged against the Page 436 U. S. 636 TAPS tariffs gave it "reason to believe the proposed rates are not just and reasonable." Trans Alaska Pipeline System, 355 I.C.C. 80, 81 (1977) (TAPS). In support of this conclusion, it cited the protestants' arguments that the filed rates allowed excessive returns on capital [Footnote 11] and that the cost data provided by the carriers were overstated. [Footnote 12] Dismissing the TAPS carriers' argument that § 15(7) gave the Commission no power to suspend initial rates, the Commission suspended the TAPS rates for the full seven months allowed by law, see 355 I.C.C. at 81-82, citing protestants' showing of "probable unlawfulness," id. at 81, and the Commission's concern that
On the other hand, the Commission found that it would not be in the public interest if TAPS had to close for a seven-month period. Id. at 3. Accordingly, "accept[ing] the basic data supplied by the carriers" as true, ibid., the Commission Page 436 U. S. 637 applied what it stated to be its traditional rate-of-return calculation [Footnote 13] to compute new rates that approximated what full investigation would likely reveal to be lawful rates, [Footnote 14] and it stated that it would not suspend interim tariffs which specified rates no higher than those estimated. See id. at 83-86. However, since the estimated rates might still "exceed reasonable levels," the Commission stated that any interim tariffs must provide for refunds of any amounts later determined to be in excess of lawful rates. Id. at 86. [Footnote 15]
Four pipeline owners, petitioners here, [Footnote 16] filed a petition for review of the Commission's suspension order in the Court of Appeals for the Fifth Circuit. That court determined: (1) that the Commission had the statutory authority to suspend Page 436 U. S. 638 an initial tariff as well as changes in tariffs; (2) that it had authority ancillary to the suspension power to set out, without an adjudicatory hearing, maximum interim rates which it would allow to go into effect during the suspension period; and (3) that it had authority to condition a decision not to suspend tariffs on a requirement that carriers whose tariffs were allowed to go into effect be prepared to make refunds of any amounts collected -- whether under initially proposed or interim tariffs -- which were later determined (after full hearing) to be unlawful. Mobil Alaska Pipeline Co. v. United States, 557 F.2d 775 (1977).
Petitioners sought review in this Court and filed applications for a stay of the Commission's suspension order, all relief having been denied by the Fifth Circuit. On October 20, 1977, we granted the applications for a stay, 434 U.S. 913, and we issued a supplemental stay order on November 14, 1977. 434 U. S. 949. Thereafter we granted certiorari to consider the three issues decided by the Court of Appeals. 434 U.S. 964. We affirm. [Footnote 17] Page 436 U. S. 639
24 Stat. 379, this Court early held that the Commission had no authority to set charges, but could only determine if charges set, by the carriers were unreasonable or unjust in the context of granting reparations to injured shippers. See ICC v. Cincinnatti, N.O. & T.P. R. Co., 167 U. S. 479 (1897); 1 I. Sharfman, The Interstate Commerce Commission 227 (1931) (hereinafter Sharfman). Page 436 U. S. 640
Id. at 51. See H.R.Rep. No. 923, 61st Cong., 2d Sess., 4 (1910), quoting President Taft's special message to Congress on the Interstate Commerce Act; [Footnote 18] S.Rep. No. 355, 61st Cong., 2d Sess., 8 (1910); [Footnote 19] United States v. Chesapeake & Ohio R. Co., 426 U. S. 500, 426 U. S. 513, and n. 10 (1976) (Chessie); Dixon, The Mann-Elkins Act, 24 Q.J.Econ. 593, 602-603 (1910) Page 436 U. S. 641 (hereinafter Dixon). The Commission's Annual Reports also tell us that, as early as 1907, private litigants were able to convince some federal courts to enjoin rate advances after their effective dates, but before the Commission was able to complete an investigation as required by the Hepburn Act. See Arrow Transportation Co. v. Southern R. Co., 372 U. S. 658, 372 U. S. 663-664, and n. 6 (1963); Sharfman 50 n. 49. Thus, not only did the Hepburn Act fail to protect the public against unreasonable carrier charges, but the equity litigation spawned by the Act led to discrimination in rates -- much like that prohibited by § 1 of the Act -- in the situation in which shippers successful in court would be paying one charge while those who were unsuccessful, or who did not have the wherewithal to go to court or to post an injunction bond, were paying higher charges. See Arrow, supra at 372 U. S. Sharfman 50 n. 49; Dixon 603.
Section 15 of the Act, as augmented by the Hepburn and Mann-Elkins Acts, thus works with §§ 1 and 6 of the Act, 49 U.S.C. §§ 1 and 6 (1970 ed. and Supp. V), to give the Commission Page 436 U. S. 642 a complete ratemaking charter. Section 1, as we have indicated above, sets the standard that rates and charges must meet, and § 6 -- which prohibits a carrier covered by Part I from engaging in interstate transportation unless its rates, fares, and charges have been filed and published and which, in addition, allows changes in any rate, fare, or charge to be made only after notice to the Commission and public through advance filing of schedules showing the proposed changes, see 49 U.S.C. §§ 6(1), 6(3), and 6(7) -- insures both that the Commission will have sufficient notice to exercise its suspension power, and that no carrier can operate on suspended or disapproved schedules.
Nonetheless, petitioners argue that "new" does not really mean "new," but refers only to increased or changed rates, i.e., rates which replace other rates previously in effect. As we understand the argument, it draws on three sources. First, it is said that Congress, in 1910, was directing its attention solely to the problem of increased railroad rates and, therefore, that the statute should be limited to this application. Second, Page 436 U. S. 643 petitioners argue that the only rate schedules the Interstate Commerce Act requires to be filed prior to their effective date are schedules of changed rates. See 49 U.S.C. § 6(3). Since, in their view, § 15(7) is intended to work in tandem with § 6(3), petitioners conclude that new schedules include only changed schedules. Finally, petitioners point to language added to § 15(7) by § 418 of the Transportation Act of 1920, 41 Stat. 48487, which they say authoritatively glosses the word "new," limiting it to the increased rate situation. We find these arguments unpersuasive.
First, petitioners' claim that the Commission is without authority to suspend initial rates is not limited to situations in which proposed initial rates are in some sense reasonable; it is a claim that a carrier can impose any rate it chooses. [Footnote 20] Nor have petitioners pointed to any mechanism which would tend to make initial rates reasonable, and Congress, in 1910, concluded that the reparations provisions of the Commerce Page 436 U. S. 644 Act are an insufficient check. Moreover, in these cases, the reparations remedy is particularly ineffective, since those who will ship oil over TAPS are almost exclusively parents or cosubsidiaries of TAPS owners. [Footnote 21] Thus, to an indeterminate, but possibly large extent, excess transportation charges to shippers will be offset by excess profits to TAPS owners, creating a wash transaction from the standpoint of parent oil companies. Indeed, it is telling that no shipper of oil protested the TAPS rates. Instead, as one might predict from experience under the Hepburn Act, see supra at 436 U. S. 640-641, only the public perceives that it will be injured by the proposed TAPS rates and has objected to them. See nn. 6-8 supra. Therefore, in the absence of suspension authority, unreasonable initial rates -- both generally and in these cases -- like unreasonable increases in existing rates, will almost certainly be passed along to "a prior producer or . . . to the ultimate consumer." Sharfman 51.
Second, if the Commission has no authority to suspend initial rates, it follows that Congress cannot have meant to foreclose whatever equity power there is in the courts to enjoin Page 436 U. S. 645 carrier rates. Thus, with respect to initial rates, courts might again reach "diverse conclusions," jeopardizing "the regulatory goal of uniformity," and "causing in turn discrimination and hardship to the general public.'" Arrow, 372 U.S. at 372 U. S. 664, quoting ICC Annual Report 10 (1907). [Footnote 22]
Accordingly, far from reaching an "absurd resul[t]'" which would "`thwart the obvious purpose of the statute,'" Brown, supra, at 380 U. S. 571, a literal reading of the word "new" in § 15(7) is necessary to curb mischief flowing from unchecked initial rates, which is in every way identical to that flowing from unchecked changes in rates to which the Mann-Elkins Act is concededly addressed. Given the equivalence of the harms resulting from unchecked initial and changed rates, only unequivocal statements in the legislative history of the Act would support any limitation on the scope of the suspension power. Petitioners, however, have been able to offer only isolated remarks made in floor debates in favor of their position. [Footnote 23] These show at most that the primary area Page 436 U. S. 646 of congressional concern was the situation in which railroads increased their preexisting rates. There is nothing to show that Congress intended to limit the suspension power to this situation, however, and, indeed, other isolated remarks show quite clearly that Representative Mann, at least, thought both initial and changed rates could be suspended. [Footnote 24] Therefore, we conclude that the word "new" must be given its literal interpretation, which embraces the rates that are the subject of this litigation. [Footnote 25] Page 436 U. S. 647
49 U.S.C. § 6(1) (emphasis added) -- plainly requires initial rates, as well as rates resulting from tariff changes, to be filed with the Commission. Since initial tariffs cannot be filed under § 6(3), the question therefore arises how initial tariffs are to be filed. Page 436 U. S. 648
The immediately preceding paragraph of the same Circular provided that "Changes in Rates" had to be filed on 30 days' notice, which suggests that the Commission was aware that the 30-day requirement of § 6(3), and indeed that § (3) itself, was inapplicable to initial rates for "new roads." The rule announced in Circular 2-A became Rule 44 of Tariff Circular 14-A in 1907 and Rule 57 of Tariff Circular 15-A in 1908, a numerical designation which has been retained to this day. See 49 CFR § 1300.57 (1977). [Footnote 27] Page 436 U. S. 649
Finally, as we have indicated, the tariff provisions in Part I of the Act did not spring full grown into the statute books. Section 6(3), part of the 1887 Act, was drafted at a time when the Commission had no ratemaking authority. Section 15(7) traces to three Acts -- the 1887 Act, the Hepburn Act, and the Mann-Elkins Act -- and was then further amended by the Transportation Act of 1920. Since, therefore, the tariff provisions grew more like Topsy than Athena, it is inappropriate to insist that each phrase in those provisions fit meticulously Page 436 U. S. 650 with every other. Instead, the Act must be construed not only by its language but by its purposes if sense is to be made of the verbal accretions of many years. Under this proper standard of construction, there is little to commend the argument that the word "change" was meant to narrow "new." To the contrary, the opposite construction -- that "new" was intended to clarify the meaning of "change" -- is more justified given the purposes of the Hepburn and Mann-Elkins Acts. Indeed, when Congress did enact comprehensive tariff schemes in Parts II, [Footnote 29] III, [Footnote 30] and IV [Footnote 31] Of the Interstate Commerce Act, which cover (respectively) motor carriers, common carriers by water, and freight forwarders, it indicated unequivocally in the language of the suspension provisions that initial rates were "new" rates capable of being suspended, and yet references to "changed" rates appear in those Parts in each place they appear in Part I. [Footnote 32] Page 436 U. S. 651
Our conclusion that the Commission can suspend TAPS's initial rates does not end our inquiry, for petitioners also argue that the Commission has here exceeded whatever power Page 436 U. S. 652 it has to suspend tariffs. Pointing to the Commission's calculation of rates which it would allow to go into effect during the suspension period, they state that the Commission has set rates without the hearing required by 49 U.S.C. § 15(1). [Footnote 33] We disagree.
The reason the Commission has been given power to suspend is to prevent irreparable harm to the public during the Page 436 U. S. 653 time when it has under consideration the lawfulness of a proposed rate. See 436 U. S. supra. The foundation for a suspension is the Commission's conclusion that a proposed rate is probably unreasonable or unjust. See, e.g., TAPS, 355 I.C.C. at 81-82. To make such a determination, the Commission is obviously required to form a tentative opinion about the location of the line between the just and the unjust, the reasonable and the unreasonable. Moreover, the Commission is required by § 15(7) to set out its reasons in writing for suspending a tariff. The usual and sufficient reason will be that the Commission has found a proposed tariff to fall on the unjust or unreasonable side of the line it has drawn, and it is a reason of precisely this sort that the Commission has given here. See 355 I.C.C. at 81-83.
Petitioners do not apparently disagree that the Commission can suspend a tariff because it falls on the wrong side of the line of reasonableness, but they would prevent the Commission in suspending a tariff from stating, as it did here, where the tentative dividing line lies. Such a statement, they say, is ratemaking. ut this is untenable: no principle of law requires the Commission to engage in a pointless charade in which carriers desiring to exercise their § 6(3) rights are required to submit and resubmit tariffs until one finally goes below an undisclosed maximum point of reasonableness and is allowed to take effect. The administrative process, after all, is not modeled on "The Price is Right." What the Commission did here, therefore, far from being condemnable, is an intelligent and practical exercise of its suspension power which is thoroughly in accord with Congress' goal, recognized in Arrow, 372 U.S. at 372 U. S. 664-666; see United States v. SCRAP, 412 U. S. 669, 412 U. S. 697 (1973), to strike a fair balance between the needs of the public and the needs of regulated carriers. Indeed, the Commission might well have been derelict in its duty had it insisted on charade once it had determined that there was a way TAPS could operate without harm to the Page 436 U. S. 654 public. Cf. Arrow, supra; SCRAP, supra; 43 U.S.C. § 1651(a) (1970 ed., Supp. V) (congressional policy favors "[t]he early development and delivery of oil . . . from Alaska's North Slope to domestic markets").
In response, we note first that we have already recognized in Chessie that the Commission does have powers "ancillary" to its suspension power which do not depend on an express statutory grant of authority. We had no occasion in Chessie to consider what the full range of such powers might be, but we did indicate that the touchstone of ancillary power was a "direc[t] relat[ionship]" between the power asserted and the Commission's "mandate to assess the reasonableness of . . . rates and to suspend them pending investigation if there is a question as to their legality." 426 U.S. at 426 U. S. 514. Applying this test, we found in Chessie a direct relationship which justified the Commission in insisting that the proceeds of proposed general railroad rate increases be used to pay for deferred maintenance. If such a use was made of the proceeds, Page 436 U. S. 655 the rates were reasonable, but they might not be reasonable if put to other purposes. Ibid. We also noted that "[d]elay through suspension would only have aggravated the already poor condition of some of the railroads." Ibid. Thus, we approved the deferred maintenance condition essentially because it was necessary to strike a proper balance between the interests of the carriers and the interests of the public.
Thus, here as in Chessie, the Commission's refund conditions are a "legitimate, reasonable, and direct adjunct to the Commission's explicit statutory power to suspend rates pending investigation," in that they allow the Commission, in exercising its suspension power, to pursue "a more measured course" and to "offe[r] an alternative tailored far more precisely to the particular circumstances" of these cases. Ibid. Since, again as in Chessie, the measured course adopted here is necessary to strike a proper balance between the interests of carriers and the public, we think the Interstate Commerce Act should Page 436 U. S. 656 be construed to confer on the Commission the authority to enter on this course unless language in the Act plainly requires a contrary result.
This passage, which declares that Congress sought to protect the public in "all cases" in which a hearing had not been concluded by the termination of the suspension period, certainly cannot be read to indicate that Congress placed any Page 436 U. S. 657 emphasis on the word "increased" or intended to limit the Commission's ancillary powers. Indeed, the House Report on the same bill, H. R Rep. No. 456, 66th Cong., 1st Sess., 20-21 (1919), appears to refer to "increased" rates only to distinguish them from "decreased" rates, over which the 1920 Act for the first time gave the Commission some authority by conferring power to set minimum rates, see id. at 19, and as to which there is no need to create a refund procedure to protect shippers. From this very sketchy history, therefore, it seems that Congress' purpose was to create a remedy less cumbersome than the reparations procedure to protect shippers whenever they could be harmed due to the shortened suspension period created by the 1920 Act. See Arrow, 372 U.S. at 372 U. S. 665-666. Accordingly, we conclude that nothing in the Transportation Act precludes what the Commission has done here and, moreover, that the Commission's actions are completely consistent with what Congress intended when it drafted the 1920 Act.
While there is no grandfather clause in § 15(7) itself which would confirm its application to initial rates, Congress was doubtless attempting to recreate the scheme of § 15(7) in Parts II-IV of the Act, and expressly stated this on two occasions. See H.R.Rep. No. 1217, 76th Cong., 1st Sess., 23-.24 (1939); H.R.Rep. No. 2066, 77th Cong., 2d Sess., 22 (1942). Moreover, since § 15(7) is in all respects in pari materia with §§ 316(g), 907(g), and 1006(e), the plain meaning of the latter sections should be given significant weight in construing the former. See United States v. Freeman, 3 How. 556, 44 U. S. 564-565 (1845); United States v. Stewart, 311 U. S. 60, 311 U. S. 64-65 (1940); Erlenbaugh v. United States, 409 U. S. 239, 409 U. S. 243-244 (1972).