Document: 332 U.S. 507 68 S.Ct. 190 92 L.Ed. 128 PANHANDLE EASTERN PIPE LINE CO.v.PUBLIC SERVICE COMMISSION OF INDIANA et al. No. 69. Argued Nov. 14—17, 1947. Decided Dec. 15, Appeal from the Supreme Court of State Indiana. Mr. John S. L. Yost, New York City, for appellant. Karl J. Stipher, Indianapolis, Ind., appellee, Public Service Commission William P. Evans, appellees, Indiana Gas & Water Co. Justice RUTLEDGE, delivered opinion Court. 1 Broadly question is whether has power to regulate sales natural gas made by an interstate pipe-line carrier direct industrial consumers in More narrowly we are asked decide commerce clause, Const. Art. I, § 8, its own force forbids Commission, require appellant file tariffs, rules and regulations, annual reports, etc., as steps a comprehensive plan regulation preliminary possible exercise jurisdiction over rates service such sales.1 2 Panhandle Eastern transports Texas Kansas fields into across intervening states, including Indiana, Ohio Michigan. In it furnishes local public utility distributing companies municipalities. These turn supply needs 112,000 residential, commercial consumers. 3 Since 1942 also sold large amounts Anchor-Hocking Glass Corporation consumption.2 Shortly before beginning this had informed number customers, that intended render directly wherever possible.3 Pursuant policy, since these proceedings began been extended another big user.4 4 1944 initiated hearings relative It concluded 'the distribution subject under laws state,' notwithstanding any alleged contrary effect clause upon appellant's sers. Accordingly issued order November 21, 1945, filing stated. 5 Early 1946 brought suit state court set aside enjoin enforcement order. While cause was pending supplemental declining offer submit specified 'as information only,' reasserting full regulatory conferred statutes.5 63 P.U.R., N.S., 309. 6 The trial vacated orders enjoined enforcing them. accepted view on operations. reversed judgment denied relief sought. 71 N.E.2d 117. held first Commission's amounted unequivocal assertion thus presented squarely affected clause. did not flatly hold rather than intrastate commerce. But, taking them be former kind, nevertheless state's doctrine Cooley v. Board Wardens, 12 How. 299, 13 996. further appellant, making sales, within meaning application statutes, Burns Ind.Stat.Ann. 54-105 Ind. Acts c. 53, p. 110. decision have review pursuant 237 Judicial Code, 28 U.S.C. 344(a), U.S.C.A. 344(a).6 7 permitting unrelated or requiring initial integral scheme, presenting at threshold scheme's go with it, primarily construction courts determine. position, construed supreme court, cannot say only thing presently involved without reference use controlling sales. Cf. Arkansas Louisiana Department Utilities, 304 61, 58 770, 82 1149. Here constituted 'an power' service. Indeed they involve something more mere threat apply later phases. They represent actual stage. situation required await contesting jurisdiction. Utilities Comm. United Fuel Co., 317 456, 369, 87 396. 8 This does mean now express concerning validity which may enter. No us. lie scope service, so some those respects entered. 9 Nor do transactions. suggestion left open court's treatment rests transported takes character commodity come rest broken bulk when leaves main transmission line and, reduced pressure, enters branch lines laterals irrevocably way final consumption. Those merely mechanical considerations no longer effective, if ever were exclusively, determine purposes continuous movement resulting here.7 10 Thus furnished utilities resale supplied unquestionably, both transportation sale, Yet subjected practically identical changes pressure use.8 Neither Practical common sense nor constitutional would tolerate holding reduction makes wholly while deliveries similar pressures remain exclusively interstate. Variations criterion states' powers Interstate Natural Federal Power Comm., 331 682, 689, 67 1482, 1486. here clearly 11 issues therefore two: (1) Has Congress, enacting Act, 52 Stat. 821, 15 717, 717 seq., forbidden states tho e consumers; (2) not, nature, related formula, act. We think there can doubt answer given each questions, namely, competent two questions best considered background legislative history Act judicial leading enactment 1938. Prior time series decisions dealt various situations arising efforts sale imported gas. story adequately told9 stop again attempt reconciliation all their groundings. Suffice 1938 delineated broadly between area permissible control could intrude. included consumers, exemplified Pennsylvania 252 23, 40 279, 64 434; latter, resale, Missouri 265 298, 44 544, 1027, reinforced Rhode Island Attleboro Steam Electric 273 83, 47 294, 549. 14 then, stood 1938, even though carrier. true domestic uses but consumption, rate whenever engaged uses.10 On other hand, usually companies, beyond reach power, regardless ultimate use. fact prevented regulating seriously handicapped effective authority.11 impotence act relation carriers about demand federal Congress' response Act. To prevent hiatus immunity caused, declared 1(b): 'The provisions chapter shall commerce, consumption domestic, commercial, industrial, use, natural-gas facilities used production gathering gas.' 16 section determines Act's coverage light existing time. Three things three Congress drew delegated agent, Commission. were: commerce; resale; (3) sale. 17 omission is, consumptive affirmative declaration inadvertent. deliberate. For sure intent mistaken adding explicit prohibition 'shall * *.' (Emphasis added.) words plainly 'for use.' Direct whatever sort excluded. 18 statute clear complete. cut sharply cleanly uses. exceptions either category particular uses, quantities otherwise. And drawn one arrived passed.12 19 Moreover, unusual precision employed relieving exempting segment industry regulation. extending regulation, purpose down power. contrary, perhaps primary aid weight supplement reinforce i gap created prior decisions.13 meticulous regard continued handicap dilute way. appears led adoption history, committee reports cited above, most 1(b) respect took place reaching form.14 20 exceedingly incongruous result motivated, designed shaped bring particularly teeth objects, import wording well, manner less capable statute's adoption. this, effect, what asks us do. essence apart standing 'occupied field,' i.e., entire field relieved subordination control. 21 exact opposite fact. true, occupied field. But take territory reach.15 That include consumer regulated repeatedly sustained. instance stricken down.16 22 case came involving cases sustaining tax, company selling users.17 suggestion, certainly decision, different follow being made. statutory kinds Both resale. Colorado 324 581, 595, 596, 65 829, 836, 89 1206. 23 articulate program based recognition respective responsibilities agencies. contemplate ineffective level. emphasized meant create complementary operation usurping authority. 467, 375, 396; Hope 320 591, 609, 610, 281, 291, 88 333; 690, 1487. And, pointed out supra, U.A. page aim legislation protect against exploitation hands companies.' scheme co-operative action18 accomplish neither protective dual mind, divert will cream heir business unregulated uses.19 24 exclude Rather policy terms confirm 'silence' involved. declaration, McCarran 59 33, 1011, 1011 insurance business, equally clear, historical setting, show intention continue where expressly taken over. Prudential Ins. Benjamin, 328 408, 66 1142, 90 1342, 164 A.L.R. 476. undoubted define Southern Pacific Arizona, 325 761, 769, 1515, 1520, 1915, authorities cited; cf. supra. exercised inconsistent exclusion authority question. 25 action moreover vital interests people, alike, Indiana's interest obvious. California her people protection evil effects Robertson People California, 440, 1160, 1366. Not instances competition fuels,20 system crippled hampered protecting classes users important.21 26 As interests, becoming important every passing year steady transition primitive fuels fuel oils, seeks up complete freedom imposed, supposed national uniform interest, own, largely illusory record. itself, asserts prices amount blocking impeding free flow. 27 There answers. One experience. Insofar phase date, shown occur. answer, experience should vary, correct abuses appear. exists, destroy unless provided.22 done reasonably necessity rests. Appellant envisages conflicting regulations commissions pipe serves, curtailment weather conditions others fears conflict assigns possibilities support alone appropriate evidence far substantial respect23 see probability serious strong outweigh referred states. develop, matter interrupting related, appellees say, control, accommodation among states.24 29 lead conclusion powerless high justify remained silent indication effective. case, addition independently, supporting removes determining independently operative silence. 30 attractive envisioned co rdinate schemes mirage. affirmed. 31 Affirmed. 32 JACKSON concurs result. 33 MURPHY part consideration case. authorized statutes creating utilities. §§ 54-101 seq. Appellant's larger several companies. Thus, 1943 1,150,279 cubic feet 151,065 served same line. See note infra. 1941. chairman board stated 'Panhandle anxious because transaction he establish higher competitive basis.' entered arrangements provide E. I. DuPont de Nemours Company plant near Fortville, commenced subsequent hearings. urged, still does, contest fix otherwise until exercised. resulted bringing forth tender compliance 'information conditioned acceptance prejudice right filing, any, deemed available carrying duties statute. Several intervenors permitted intervene test here. National Association Railroad Commissioners filed brief amicus curiae position. Illinois Central 314 498, 504, 62 384, 386, 86 371, earlier turned 'applying ends begins,' 'upon introduction pipes distributor,' then stated: 'In Court, concerned find point space begins, looked nature involved, objective state, South Carolina Highway Dept. Barnwell Bros., 303 177, 185, 187 510, 513, 514, 734; Thompson, 313 109, 113, 114, 61 930, 932, 85 1219; Duckworth Arkansas, 390, 311 (86 138 1144).' 505, 386. 22-inch 250 pounds per square inch. 16-inch 200 inch, 6-inch lateral 100 adjacent meter houses. From house low ranging Similarly, stemming inch approximately plant. summary passage 371. Powell, Note Physics Law—Commerce Electricity, Harv.L.Rev. 1072; Howard, Electricity Commerce, Minn.L.Rev. 611. contends 'wholesale,' quantity, Anchor-Hocking, distinquished 434, commonly associated supplying city. Nothing however, requires limited. emphasis placed just 'factories residences' Oentral 387, Chief Stone, summarizing 'sold consumers'; Jersey Light 319 78, 80, 953, 962, 1258 (dissenting opinion); Note, 1072, 1082, quoted infra 12. 549, face finding Narragansett electric current suffering operating loss customers yielded fair return; contentions grounded effectively company. Compare memorandum submitted behalf Utility general solicitor, Benton, Hearings Committee Foreign Commerce H.R. 4008, 75th Cong., 1st Sess. 141, 143: 'Sales ought exempt very well unjustifiable discrimination result, commission complaint Sales regulates reasonable rates, properly other, established.' '* (T)he allowed tax price delivery electricity sister necessarily last consummated consumption.' 1082. H. Rep. 709, Sess., said proposed bill became Act: 'It confers States have, course, many years able absence congressional (See (1920), (40 434).) present disturb However, so-called wholesale (for example, producing companies) legal different. Such transactions Congressional action, (State of) (Natural) (1924), 298 (44 1027), (of Island) (1927) 83 (47 549).) basic occupy act.' 2651, 74th 2d 1—3; Sen. 1162, representative federal, amendment only, legislation. 124. answering memorandum, Benton representative's misunderstanding 1(b), stating 'service user much householder (and) occupies field, accordingly Id. 143. He alternative only. 142. Benton's adopted House substantially unaltered form finally enacted. H.Rep.No.709, representatives municipalities appeared bill. position relies 800, 80th favorably reporting 4051 amending become law. views expressed report 1947, nine after passage, hardly determinative or, juxtaposition contemporaneous persuasive notes Ibid. ruling purposes. recognized 371; supra; 308, 545, 1027; 87, 295, cases, 13. granted necessitates close correlation bodies. Section provides cooperation text. fn19 Over 38 cent gross revenues derived If suffer great losses revenue, unable dispense trivial percentage properties. resultant increase unit cost increased Pipe-line physical characterizing magnitude investment required, acquires monopolistic effects, marketing areas distant ones. 17, 333 Most often competing lines. 19. Milk Control Commonwealth Eisenberg Farm Products, 306 346, 528, 752; 448, 1164, 1366; Ind strial Ohio, 135 St. 412, 166; re P.U.R.,N.S., 202. Kentucky Whip Collar Cent. R. 299 334, 57 277, 81 270; Clark Distilling Western Maryland 242 311, 37 180, 326, L.R.A.1917B, 1218, Ann.Cas.1917B, 845; Darby, 312 100, 451, 132 1430. asserted appellee functions granting permission 7(c) extend serve plant, specifically provided 'without rendered du Pont.' 18. 23.

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