Opinion ID: 504039
Heading Depth: 1
Heading Rank: 3

Heading: discussion of csmfta's arguments

Text: 65 (A) Deference To Be Given To Commission's Interpretation 66 CSMFTA argues that this court must interpret the statutory provisions at issue without giving any deference to the interpretation of the Commission because (1) the Commission has long been the industry's adversary in the legislative arena where the single-line rate definition was forged as a compromise position between those who sought termination of collective ratemaking altogether, and those who sought continuation of collective ratemaking, and (2) the precise meaning of the definition is so clear on its face that the congressional intent is unmistakable. It contends: 67 The plain meaning of these words limit the single-line definition to one that is proposed to apply only over the line of a single carrier. Stated negatively, a proposed rate is not a single-line rate if it is to apply via more than one route, i.e. over more than one line, irregardless [sic ] of whether it is to apply to the single-line service or to the joint-line service provided by the carriers [sic ] party to the tariff. 68 We cannot accept this argument for several reasons. First, CSMFTA, by stating negatively the second clause of the statutory definition, actually is arguing that Congress, by stating its proposition in the singular, necessarily excluded the plural. That argument violates a basic principle of statutory interpretation--that the singular includes the plural and the plural includes the singular. 1 U.S.C. Sec. 1. 69 Second, we must also reject CSMFTA's argument because it would require us to find, by negative implication, that Congress meant to exclude a rate over several lines. However, where two or more carriers can provide the same service between two points, CSMFTA's interpretation would permit them to fix prices rather than compete. 70 We construe over, as does the Commission, in accordance with the first meaning given to it in Webster's Third New International Dictionary 1605 (1981): [F]rom one point to another across an intervening space or barrier. Congress was speaking of rubber to the road transportation from one point to another on a carrier's line. Both eastern Kentucky pick-up and delivery charges and the residential delivery charges apply to, and can only be charged for, transportation only over a single carrier's line. 71 Third, to have a plain meaning, words used by Congress ought to have a plain intent and purpose. CSMFTA asserts that the purpose of Congress in enacting this legislation was (1) to make it impossible for a carrier to use rate bureau disapproval of a single-line rate as an excuse to a shipper for not lowering its rates, and (2) to establish that the only way that a carrier could put into effect a rate applicable only over its own line would be to take independent action. 72 However, CSMFTA fails to provide any reason why a carrier interested in maximizing its profits would choose to take independent action to compete with its competitors and run the risk of being subject to the antitrust laws when it could, simply by taking collective action, collude with its competitors to raise prices and enjoy immunity from antitrust prosecution. 73 Thus, CSMFTA's interpretation, if adopted, would mean that the Act does nothing in the way of deregulating single-line rates. We agree with the court's statement in Niagara I: As we read petitioner's definition, it would make the prohibition on single-line rates wholly redundant of the provisions of the Act that already allow for 'independent action' by a single carrier. 780 F.2d at 110. 74 (B) Local Rates 75 CSMFTA also alleges that the Commission's interpretation of the term single-line rate results in a prohibition exactly like what would have occurred if Congress had simply used the term local rate, which was in common use throughout the industry. It argues that the industry rates are known as single-line rates, local rates, and joint rates. Only the terms single rate and joint rate appear in the provisions of the Act that prohibit certain discussions of single-line rates. Congress did not use the term local rate in 49 U.S.C. Sec. 10706(b). 76 CSMFTA argues that single-line rates and local rates differ in that numerous carriers can provide what is properly called single-line (or single-carrier) service between two points as long as each provides a service entirely over its own line; but, if the rate for such single-line service between two points applies to more than one carrier, the rate is not a single-line rate, but a local rate. It contends that single-line modifies rate rather than service. The only authorities cited for this proposition are the front title pages of four separate illustrative tariffs. Those title pages recite that the tariffs apply to local, joint and proportional class rates and exceptional classes via all motor routes. 77 In response, the government contends that in common industry usage the term local rate means the same thing as single-line rate, citing Practices of Motor Common Carriers of Household Goods, 118 M.C.C. 762, 763 n. 1 (1973) and Davis & Sherwood, Rate Bureaus and Antitrust Conflicts in Transportation, XII, XIV (Praeger Pub. 1975). 78 CSMFTA's argument ignores the expressed legislative intent to require motor common carriers to compete aggressively to provide transportation services for shippers, where those carriers can individually, without the assistance of any other carrier, provide all of the required transportation and related services between two points. The failure of Congress to distinguish between single-line and local rates indicates that it intended no such distinction. 79 Further, the meaning of technical industry terms is a function of the Commission, and CSMFTA has not persuaded us that the Commission's interpretation is not reasonable. 80 (C) Application of Statutory Exceptions 81 49 U.S.C. Sec. 10706(b)(3)(D) bans collective discussion of or voting upon single-line rates, but includes four exceptions to that ban. CSMFTA claims that, even if the Commission's interpretation of single-line rates is correct, its proposed tariffs fall within three of those exceptions--the subparagraph (i) exception for general rate increases or decreases; the subparagraph (iii) exception for changes in tariff structures; and the subparagraph (iv) exception for changes in rules and regulations. 82 Both the exception for general increases and decreases and the exception for changes in tariff structures are further specifically limited by requirements that any discussion of single-line rates must be limited to industry average carrier costs and must not include discussion of individual markets or particular single-line rates. CSMFTA has not preserved any issue for consideration with respect to whether its members limited their discussions to industry average carrier costs and did not discuss individual markets or particular single-line rates. Our rulings in these cases make it unnecessary for us to decide whether CSMFTA complied with those requirements. However, we note that the record includes a statement by Dennis M. Miller, its Manager of Rates and Tariffs and Vice President, that members' discussions in the eastern Kentucky proceedings were limited as required by the Act. Cf. Sec. 10706(b)(3)(G) (party alleging carrier's discussion or vote on rates violated Act has burden of showing it occurred). He makes no such claim for the residential charges proceedings; instead, he states that CSMFTA was of the opinion that the proposal was a change in general rules and regulations and hence not subject to the Act's limitations on discussions. 83 The exception for changes in rules and regulations is limited to changes which are of substantially general application throughout the area in which the changes will apply. As we interpret the exception, no limitation upon discussion is necessary because (like discussions in connection with changes in commodity classifications, publishing of tariffs, filing of independent actions, and providing of support services) permissible discussions cannot possibly defeat the purpose of the Act to require competition in the fixing of single-line rates. 84 We see no reason to disagree with the court's conclusion in Niagara II that the Commission's interpretations of these exceptions are reasonable. Accordingly, we conclude that none of the exceptions applies to the single-line rate changes proposed by the petitioner's tariffs. 85 (1) General Rate Increases Exception 86 The Commission, in 49 C.F.R. Sec. 1331.5(j)(1) (1986), has defined a general increase as a proposed general adjustment of substantially all the rates published in a rate bureau's tariff or tariffs. As noted by the court in Niagara II, 826 F.2d at 1191, the Commission definition is consistent with the legislative history of the Act. It is particularly important to note that the Committee does not intend that general rate increases or decreases that are applicable to all rates charged by one or more carriers be eliminated from the existing antitrust immunity. House Report, supra, at 28, 1980 U.S.Code Cong. & Admin.News p. 2310 (emphasis added). 87 The Commission held that the eastern Kentucky delivery charges were not general increases because they would have increased only one segment of the transportation charges and would have applied only to a small portion of the rate bureau's territory. It also determined that the residential delivery charges were not general increases because they sought to impose new charges where none had previously existed. Further, as argued by the government, the increases affect only one limited aspect of the line-haul rate (pick-up and delivery) on a narrow class of shipments (those involving residential service). 88 The purpose of a general increase appears to be to spread increased costs over substantially all the customers served by the carriers by increasing virtually all the rates covered by a rate bureau's tariffs. If limited to that purpose, a general increase is not anticompetitive and antitrust immunity is warranted. 89 The Act declares that antitrust immunity is not warranted where the carriers discuss any costs other than industry average carrier costs or discuss individual markets or particular single-line rates, regardless of whether the resulting rate is or is not based on any such prohibited discussion. In the light of this policy, we believe that the Commission's interpretation is reasonable and necessary to accomplish the Congressional purpose. 90 CSMFTA argues that its increases are general, but does not explain how its interpretation fits into the purposes of the Act and the regulations. It also does not persuade us that it can meet the Commission's definition by simply publishing the charges in separate tariffs. 91 (2) Changes in Tariff Structure Exception 92 The Commission, in 49 C.F.R. Sec. 1331.5(j)(2) (1986), states that a  'broad change in tariff structure' modifies in a relatively non-uniform fashion the relationship between most rates published in a rate bureau's tariff, and applies to a large area, either nationally or regionally. 93 CSMFTA correctly points out that Sec. 1331.5 establishes, according to its title, additional standards and procedures required for passenger bus industry, rather than motor carrier industry, rate bureaus to retain antitrust immunity. CSMFTA further notes that, although Sec. 10706(b)(3)(E)(i) states that such changes must be broad, the word broad does not appear before tariff structures in the exception set forth in Sec. 10706(b)(3)(D)(iii). It also points out that Congress used the term broad rate restructuring in limiting collective changes in rates established by independent action. 49 U.S.C. Sec. 10706(b)(3)(B)(ii). No serious objection appears to have been raised to this point when the Commission's rules were initially adopted. See Motor Carrier Rate Bureaus--Implementation of Pub.L. No. 96-296, 364 I.C.C. 464, 493-94 (1980), aff'd in pertinent part sub nom. American Trucking Ass'n v. United States, 688 F.2d 1337 (11th Cir.1982), rev'd on other grounds, 467 U.S. 354, 104 S.Ct. 2458, 81 L.Ed.2d 282 (1984). See also, Collectively Set Accessorial Rates and Charges on Household Goods, HGCB, 1 I.C.C.2d 157 (1985). 94 However, in interpreting the statutory exception, the Commission is required to determine when a proposal is really a tariff restructuring in order to accomplish the Congressional purpose of preventing anticompetitive activity. Some limiting adjective, whether broad substantial or significant, must be used to prevent carriers from using the exception to swallow the rule. Further, as noted by the government, the Commission's interpretation only means that the motor carrier industry will be placed on the same footing as other industries. No substantive reason appears in the briefs or in the record for a conclusion that the exception should be narrower or broader than the exception for other industries. 95 Nevertheless, the omission of the word broad in this exception, despite its use in comparable language elsewhere in the statute, is not to be minimized. After all, Congress expresses its purpose by words. It is for us to ascertain--neither to add nor to subtract, neither to delete nor to distort. 62 Cases of Jam v. United States, 340 U.S. 593, 596, 71 S.Ct. 515, 518, 95 L.Ed. 566 (1951). The omission may be critical to the determination of a future case involving an unquestionable change in tariff structure. In this case, we determine that the rate changes cannot appropriately be called a change in tariff structure. 96 The dictionary meaning of structure, in the context of the Act's use of tariff structure, is the interrelation of parts as dominated by the general character of the whole. Webster's Third New International Dictionary 2267 (1981). In this instance, the general character of the whole is economic in nature, and requires expert interpretation and application by the Commission to a historic and highly technical and regulated industry. 97 The changes made in the eastern Kentucky delivery charges and in the residential pick-up and delivery charges are mere aggregations of many specific individual and specific rate adjustments. They are not a change in the interrelation of the parts of a tariff structure. 98 (3) Changes in Rules and Regulations Exception 99 Finally, the Commission held that neither the tariffs established in the eastern Kentucky proceedings nor the tariffs established in the residential charges proceedings qualified under the changes in rules and regulations exception of subparagraph (iv). 4 100 The ten percent added charge to destinations in eastern Kentucky and the new charge published for pick-up or delivery at residences throughout CSMFTA's territory were published in its rules tariff, ICC CSA 127-K. It is possible to argue, as does CSMFTA, that the change in the charges necessarily results in a change in that rule. However, the Commission held in the eastern Kentucky proceedings that [t]he proposal involves additional charges for a specific service involving specified shipments to points in a limited geographical area, and these charges cannot properly be labeled 'rules.'  Collectively Set Delivery Charges at Eastern Kentucky, C & SMFTA, I & S No. M-30374, slip op. at 7 (March 19, 1986). Further, it ruled that the changes in the charges were not of substantially general application throughout the area in which the changes would apply because they constituted only a small segment of the territory governed by CSMFTA. 101 The Commission held in the residential pick-up and delivery proceedings that the fact that rates and charges are contained in a rules tariff does not extend the permissible collective consideration to specific rates and charges. Pickup and Delivery at Private Residences, C & SMFTA, October 1985, I & S No. M-30376, slip op. at 7 (May 7, 1986). Since the charges were obviously of general application throughout CSMFTA's territory, the Commission did not hold that this was an additional ground for rejecting the proposal. 102 The Commission's decisions are consistent with an earlier case from the D.C. Circuit in which motor carriers argued that items of rates and charges, which the Commission had struck from an agreement between the carriers providing for collective action with respect to freight classifications, were rules and regulations governing classification matters. National Classification Comm. v. United States, 746 F.2d 886, 891 (D.C.Cir.1984). In affirming the Commission decision, Judge Bork stated: The relevance of the charges to classification characteristics does not turn the charges themselves into such characteristics. Id. 103 CSMFTA argues that the only kind of rules that can be embraced by the word rule as used in the exception are rules that do in fact contain rates, charges, or allowances, and that the exception only has meaning if it is interpreted to include rules that contain charges such as those that are at issue in each of the cases under review. 5 In its brief as amicus curiae, Bulk Carrier Freight Conference, Inc. (Bulk Carrier) argues that: 104 There was no reason for Congress to except from the prohibition against discussion and voting upon single-line rates the discussion and voting upon rules and regulations if Congress had not intended such discussion and voting activities to also include the charges, even if single-line in nature, associated with such rules and regulations. 105 Both CSMFTA and Bulk Carrier argue that tariff rules have always contained rates and rates have been published in rules tariffs or the rules section of tariffs. 6 106 The rules and regulations exception does not require a change in a rule or regulation to be of general application throughout a rate bureau's entire territory. The exception includes any such change so long as the rule applies generally to the area to which the change will apply. However, the primary question to be decided is not whether a rule change is of general application in an area, but whether a change in a charge is automatically a change in a rule. We find nothing in the record or in the briefs of CSMFTA or Bulk Carrier that specifically describes any changes in the rule in question, other than changes in single-line rates. We experience difficulty with arguments that appear to be saying that Congress intended that such single-line rate changes can simultaneously be general increases, changes in tariff structures, and changes in rules or regulations. 107 The carriers' argument, by a literalistic construction of the fourth phrase, appears to create a syllogism as follows: A rule contains charges. The addition of a charge to, a subtraction of a charge from, or the change of a charge within, the rule is a change in the rule. Therefore, Congress intended that all member carriers of a rate bureau, including member carriers with no authority to participate in the transportation to which the change applies, 7 can vote upon a proposal to change a single-line rate if the rule containing the change in the charge is of at least substantially general application throughout the area in which the changes in the charges will apply. 108 The major difficulty with that argument is that it appears to make the exception to the prohibition swallow the prohibition. Granted, the collective establishment of rules and regulations has been a traditional rate bureau activity, and changes in provisions relating to transportation and transportation services may affect charges associated with those provisions; it does not follow that Congress necessarily intended to permit, without limitation, everything that the preceding in pari materia language has either prohibited, or permitted only within specified limitations, whenever a rate bureau changes a single-line rate in a rule or finds a rule it can change by the addition of a single-line rate. 109 We see no reason why Congress would have intended the four items in the subparagraph (iv) exception to be used to permit a majority of carriers, including carriers who could not otherwise vote on the applicable rate changes, to establish single-line rates that would be binding on all carriers except those carriers who individually choose to flag out of the proposed change rather than remain in a price-fixing combination that is immune from antitrust regulation. 110 The purpose of the proposal for the ten percent delivery charge was intended to compensate carriers for serving a sparsely populated consuming area. The purpose of the increase in residential charges was intended to reimburse carriers for the special handling expenses incurred in serving residential customers. These might have been published separately as changes in charges, and not as a part of the rule, without in any way affecting any rule or regulation then in existence. 111 The Commission has ruled that this type of collective action defeats the congressional policy that individual carriers must determine their own rates in a competitive atmosphere. As our previous discussion indicates, we also have determined that the Act is premised upon that policy. Although CSMFTA does not agree that Congress established such a policy, its only countervailing arguments are based primarily upon what it considers to be the plain meaning of the statutory language. 112 The Commission's interpretation does not violate the plain meaning of the language. It only rejects the notion that any change in a charge necessarily is a change in the rule. The Commission has clearly acknowledged that rate tariffs may contain rules and rules may contain rate tariffs. The plain meaning of change in a single-line rate is not the same as the plain meaning of change in a rule or regulation, and no mere change in form only can alter that plain meaning. 113 The Commission's interpretation in these cases applies only where the change is merely a specific change in a single-line rate. Its decisions state that its practice is to consider collective-action violations on a case-by-case basis. The Commission's decisions in these two cases do not preclude an appropriate determination consistent with congressional intent in any other case when a problem that appears to require a change in a rule or regulation also appears to be inseparable from, or highly relevant to, a claimed necessity for making corresponding changes in the associated rates or charges. 114 Even if we did not give deference to the Commission as required by Congress, familiar principles of statutory construction require us to construe in a comparable manner all of the four items excepted by subparagraph (iv) from the prohibition against single-line rate discussions and voting and from the prohibition against member carriers voting upon rates not applicable to any transportation or services that they provide. See, e.g. Third Nat'l Bank v. Impac Ltd., 432 U.S. 312, 322, 97 S.Ct. 2307, 2313, 53 L.Ed.2d 368 (1977). 115 Obviously, any discussion or voting upon each of those four items may, in some instances, require discussion or voting upon single-line rates. Otherwise, there would be no purpose in including all four items as exceptions to the two general prohibitions. In the case of publishing tariffs or filing independent actions, single-line rates generally will be included therein. 116 Subparagraphs (i) and (ii) both permit limited discussions of and voting upon single-line rates. However, neither subparagraph (iii) nor (iv) places any limitation upon such discussions or voting. The most reasonable interpretation of these exceptions, construed in pari materia with the other provisions of the Act, is that Congress believed that any discussion of or voting upon single-line rates by member carriers (even if member carriers who will not participate in the transportation are permitted to vote) in connection with subparagraphs (iii) and (iv) could not have any serious anti-competitive effect upon the single-line rates to be charged by members of a rate bureau, nor otherwise defeat the purposes of the Act. Antitrust immunity is warranted because of the need for expediting such actions and in order to preclude the possibility of purely technical violations of the antitrust laws.