Document: 331 U.S. 682 67 S.Ct. 1482 91 L.Ed. 1742 INTERSTATE NATURAL GAS CO., Inc.,v.FEDERAL POWER COMMISSION et al. No. 733. Argued May 2, 1947. Decided June 16, Rehearing Denied Oct. 13, See 68 30. Mr. William A. Dougherty, of New York City, for petitioner. James D. Smullen, Austin, Tex., State Texas al., amici curiae, by Special leave Court. Charles E. McGee, Washington, D.C., respondent Federal Power Commission. Chief Justice VINSON delivered the opinion 1 This case originated in proceedings before Commission initiated pursuant to § 5(a) Natural Gas Act 1938.1 After overruling objections its jurisdiction, entered an order requiring petitioner effect substantial rate reductions certain sales natural gas and file new schedules rates charges.2 Petitioner seeking review Circuit Court Appeals, denied jurisdiction set issue this asserted that so established were confiscatory. That Court, one judge dissenting, petition review.3 We granted certiorari limited question Commission's jurisdiction. 300 852, 674. 2 owns operates 110 wells or controls over 56,000 acres Monroe field northern Louisiana. Petitioner's main pipe line transports southward from through a part Mississippi back into Louisiana where at Baton Rouge are made various distributing companies industrial consumers. concedes with respect these operations it is company within meaning 2(6)4 has regulate connected therewith. 3 The involves three pipe-line each which purchased markets States other than Louisiana.5 produced petitioner's flows system lines, moving first branch then trunk finally, lines delivery purchasing companies. During course movement purchases producers introduced designated points there commingled own wells. By far larger o purchase d been gathered selling made.6 moves well pressure. Shortly after completed, directed compressor stations subjected increased pressure may be moved as distant Illinois. entire pumps across state continuous process without interruption storage, processing any purpose.7 All sold transactions destined ultimate public consumption 4 It appears supplies only pipeline field.8 Counsel conceded prices charged were, agreement, identical those being field. found was affiliate conclusion 'unjust, unreasonable unlawful' ordered amounting $596,320 per year applied volume test 1941. 5 no time contended regulation beyond constitutional powers Congress. vigorously asserted, however, Congress did not exercise full National 1(b) preclude valid agency. Section provides: 6 'The provisions shall apply transportation interstate commerce, sale commerce resale domestic, commercial, industrial, use, natural-gas engaged such sale, but local distribution facilities used production gathering gas.' 7 consumption. 8 raised two issues: First, contended, 'in commerce.' Second, 'production gathering' hence power regulation. 9 have doubt commerce. Ideed, peti tioner contest position Commission, but, record reveals, rehearing Appeals.9 '* * constant flow mouths belonging Interstate station respective purchaser, thence said purchaser thus states *, all interruption, moment production.' further transported Companies continues and, business known Interstate, outside Louisiana.' 10 Under circumstances described clear quite much they would had pipes crossed reaching sale.10 Thus Public Utilities Rhode Island v. Attleboro Steam & Electric Co., 1927, 273 83, 47 294, 71 549, electrical energy held Commenting on case, Jersey Central Light Co. 1943, 319 61, 69, 63 953, 957, 87 1258 stated: 'We see distinction between line.' There nothing terms legislative history indicate intended more restricted attributed phrase commerce' theretofore given opinions Court.11 2(7) defines 'interstate point thereof, same place *.' Clearly carried States. language suggest consummated crosses should regarded 'in' 11 Nor we impressed suggestion beginning when gas, pressure, markets. Long reaches committed journey follows deviation. circumstances, increase must merely incident rather origin.12 12 Company contends, regardless whether fall clause specifically excepting In evaluating contention lose sight objectives sought accomplished passing Act. 13 series decisions announced prior passage Act, although acted, wholesale States.13 Petitioner, relying upon principles cases, successfully avoided Service Commission.14 As stated House Committee report, 'basic purpose' 'to occupy Supreme act.'15 denying purpose free effective control. restriction was, preserve areas constitutionally competent act. Report states: bill takes authority Commissions, drawn complement manner usurp regulatory authority. *'16 Clearly, among reserved physical interests conservation consideration legitimate concern.17 intention give freedom matters. Thus, sales, though technically during closely incidents render inconsistent interference functions, does attach.18 But conflict clearly shown. Exceptions primary grant section strictly construed. sufficient defeat assert some degree affected.19 14 way enactments elaborate provision resources rules regulations relating process.20 Most presumably, applicable operations.21 devoid ever opposed urged federal interfere functions.22 do determined resistance lack Company's State's invaded, regard matter significance freely exercised evidence conflict, present threatened, performing functions case. 15 precluded regulating reason exception gas. asserts, consequently basic rise great many subsidiary questions 'gathering' 'transmission' continued found, completed surrender custody title. unnecessary resolve issues. consisted movement. consummated, thegathering remains done. cannot doubted their predominately national, contrasted concern. Unreasonable charges exacted stage become perpetuated large fixed items costs covered subsequent purchasers including consumer.23 avoid situations passed. 16 For reasons above concluded exceeded conferred 17 Affirmed. 52 Stat. 821, 56 U.S.C. 717 seq., U.S.C.A. seq. F.P.C. 416. Cir., 1946, 156 F.2d 949. 2(6) "Natural-gas company' means person resale.' include River Fuel Corporation, Southern Company, United Pipe Line account Memphis Company. total 51,659,799 Mcf Of total, 28,819,814 Mcf. 22,839,985 purchased, 95% petitioner; remaining 5% directly heads. 21,863,278 question. 'dry' extraction processing. Before run 'scrubbers' remove dirt foreign particles. accomplished, supply Corp. 22% requirements, 24% requirements 16.61% complaint filed District Eastern invoking equity restrain conducting investigation charges, commission. requested relief. D.C.1940, 33 F.Supp. 50; Id., 34 980. Shafer Farmers' Grain 1925, 268 189, 45 481, 69 909; Lemke 1922, 258 50, 42 244, 66 458; Dahnke-Walker Milling Bondurant, 1921, 257 282, 106, 239. And Illinois 1942, 314 498, 503, 504, 62 384, 385, 386, 86 371; Currin Wallace, 1939, 306 1, 10, 59 379, 83 441; People's Comm., 1926, 270 550, 554, 46 371, 372, 70 726; R. De Fuentes (Railroad Comm.), 1915, 236 157, 163, 35 275, 276, 517. Cf. Milk Control Board Pennsylvania Eisenberg Farm Products, 346, 528, 752. 508, 388, Peples Natur al 75 U.S.App.D.C. 235, 127 153. 70, 71, 958, 1258. supra, pages 505, page Tax Comm. 1931, 284 41, 44, 62, 63, 76 156. Missouri ex rel. Barrett Kansas 1924, 265 298, 44 S.t. 544, 1027; 549; Wichita 1934, 290 561, 54 321, 78 500. note 9, supra. H.R.Rep.No.709, 75th Cong., 1st Sess., 2. Ibid. Colorado 1945, 324 581, 602, 603, 65 829, 839, 89 1206. 18 taking fields even Matter Columbia Corp., 200; Billings 228. express validity jurisdictional tests employed cases. 19 1206; Hope 1944, 320 591, 607—612, 64 281, 290—292, 88 333. 20 La.Gen.Stat. §§ 4766—4826.2. 21 contains testimony counsel conformed requirements. 22 municipalities participated 23 A number cases reasonableness cost incurred acquiring inquired buyer seller affiliated corporations arms length. affiliation exist companies, Corporation. finding 'close contractual operating arrangements' another Pipeline America Slattery, 1937, 302 300, 58 199, 82 276; Columbus 292 398, 763, 1327, A.L.R. 1403; Dayton 290, 647, 1267; Western Distributing 1932, 285 119, 283, 655; Smith Bell Telephone 1930, 282 133, 51 65, 255; Railroad 1929, 278 49 150, 73 390.

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