Document: 371 U.S. 115 83 S.Ct. 217 9 L.Ed.2d 177 GILBERTVILLE TRUCKING CO., Inc., et al., Appellants,v.UNITED STATES al. No. 40. Argued Oct. 15, 1962. Decided Dec. 3, Loyd M. Starrett, Boston, Mass., for appellants, pro hac vice by special leave of Court. Lionel Kestenbaum, Washington, D.C., appellees. Mr. Chief Justice WARREN delivered the opinion 1 This case concerns disapproval Interstate Commerce Commission a proposed merger on ground that 'control and management in common interest' over two applicant-carriers had been unlawfully effectuated prior to application violation § 5(4) Act, as amended, 54 Stat. 907, 49 U.S.C. 5(4), U.S.C.A. 5(4).1 2 The are L. Nelson & Sons Transportation Co. Gilbertville Trucking Co., both whom certificated carrier motor carriers. principal stockholders half brothers, Charles Chilberg Clifford Nelson; is wholly owned third brother, Kenneth Nelson. 3 was filed October 6, 1955, carriers their pursuant 5(2) Act. Two months later initiated an investigation into possibility authority granted 5(7) proceedings were consolidated hearing. trial examiner determined being violated, but recommended be approved neither intentional nor flagrant. Division 4 affirmed finding violation, disapproved merger, ordered terminated. 75 M.C.C. 45. On reconsideration, full Division, further divest himself 80 257. A suit before three-judge United States District Court Massachusetts enjoin set aside Commission's orders dismissed reasonable supported substantial evidence. 196 F.Supp. 351. An appeal taken this contesting (1) (2) denial (3) order divestiture. We noted probable jurisdiction. 368 983, 82 597, 7 522. factual issue turns upon development family, management, operational relationships between Nelson, Gilbertville, carrier, R. A. Byrnes, which 5 transportation business first organized 1930 partnership. In 1947 it incorporated stock issued Mrs. (formerly Chilberg) four her seven children (including Chilberg). Upon Nelson's death 1950, equal numbers shares devised children. 1951, sold his original received agreed sell them remainder he entitled distribution estate. transfer made January 23, 1953. Since date, have now president treasurer; secretary assistant treasurer. 6 sale resigned officer director However, kept office at headquarters Ellington, Connecticut, retained company 'free-lance tariff consultant.' such capacity paid approximately $15,000 1952 $13,000 While claims independent contractor, only client week 1953, wrote Co.'s accountant, Sanol Solomon, requesting advice acquisition Soon thereafter began negotiations with Gilbertville's owner, March took control. July all has controlled Kenneth. April 1954 obtained temporary from take operations Inc.; Byrnes August 1956. 8 routes these three form cohesive network along eastern seaboard Columbia. presently general commodities regular irregular points Massachusetts, Rhode Island, New York City. City, Philadelphia, Columbia, adjacent cities. It also contract canned goods Masachusetts, Island. textile Hampshire, areas Philadelphia. intrastate traffic Connecticut Massachusetts. Thus, general-commodity complement each other perfectly overlap considerable degree after instituted number permanent changes carrier's tending integrate terminal facilities Gilbertville; where necessary cooperation permission move records head offices acquired place incorporation, second floor nelson building. Where possible used terminals, subletting Connecticut; City; Newton, Massachusetts; Woonsocket, Its cities, listed under same telephone number, they shared interterminal lines. Almost identical approval Byrnes. Byrnes' moved Mullica Hill, Jersey, York; number; direct result control interest hands Clifford, might inferred similarly indicative Gilbertville. 10 Further substantiation integration provided fourth corporation, Bergson Company, real estate corporation formed receive residual properties Linnea owns terminals leased sublet children, directors, provides corporate tie-in brothers. 11 not unusual share facilities, indeed do unrelated repetition practices throughout respective systems makes alleged independence suspect. When then supplemented day-to-day integrating business, equipment, managerial policies, justified concluding fact managed interest. Such additional readily found record case. 12 Most significant equipment interdependence $35,000 deficit about purchase price, assets $69,000, 1953 operating revenue $75,000. By 1956 increased sevenmonth figure $444,777. impressive growth face continual short-term credit squeeze lack working capital equipment. however, declining market Northeast highly periodic demands carriage. As result, fluctuating overcapacity occasionally estimated one six tractor-trailer units trip-lease every day up five pieces lease, amount times onehalf own carriage capacity. Added certain interlining practices.2 interlined 25% 30% its business. Over one-third interline majority truckload quantities. Owing shortage, practice whereby out start run effect point so operated trip; moreover, driver stay unit, changing employers transfer.3 13 Finally, includes evidence occasions employees discovered highway spot checks carried small shipments belonging other; did one-quarter repairs; exercised Gilbertville.4 14 sufficient show degree. If intended Congress reach de facto relationships, warranted section violated. I. 15 Section part comprehensive legislative scheme designed ownership, within regulatory jurisdiction Commission. Simply, 5(2)(a) gives power authorize approve joint operation or more carriers; declares, 16 'It shall unlawful any person, except paragraph (2), enter transaction scope subparagraph (a) thereof, accomplish effectuate, participate accomplishing effectuating, carriers, however attained, whether directly indirectly, use officers, stockholders, holding investment companies, voting trust trusts, manner whatsoever. * words management' construed include exercise management.' 17 complementary character sections discussed some length v. Marshall Transport 322 31, 64 899, 88 L.Ed. 1110. originally enacted Emergency Railroad Act 1933, 48 217, applicable railroads; extended cover 1940, 905, 907—908. appellants correctly state, Congress, passing supplementary 5(5) (6),5 primarily concerned reaching elaborate devices centralize railroads 'without commission supervision defiance will Congress.'6 Although 1920 provide complete supervision, proved inadequate system.7 basis history, argue limited proscription informal shown record. 18 narrow interpretation statute, confuses particular manifestation problem faced 1933 ultimate congressional intention effectuating 5(2). face, proscribes just legal devices, 'in whatsoever.' Any doubt phrase removed when added definition 'control' 1(3)(b) 899—900. states purposes sections, 'shall actual well control, maintained through reason method circumstances surrounding organization *.' language encompass type left agency charged enforcement determination facts exists, subject normal standards review. supra, p. 38, 903; Alleghany Corp. Breswick 353 151, 163—165; Rochester Telephone States, 307 125, 145—146, 59 754, 764—765, 1147. manner, may adapt actualities current industry involved apply extent feels protect without having return time change. 19 cursory glance experience shows decided covered must Typical attempts active effectively lease dormant tripleasing continuously routes, e.g., Nigro Freight Lines, Inc.—Purchase—Coady 90 113; acquire supplying funds allegedly third-party purchasers, Black—Investigation Control—Colony Motor Transportation, 275; Coldway Food Express, Inc.—Control Merger—Foodway 87 123; inactive owners allow employee another manage merge Gate City Co.—Control—Square Deal Cartage 591. present case, held 'require finding' 5(4). 4, similar review facts, concurred. conclusion 4. Judicial limtied consideration rational Pierce Auto 327 515, 66 687, 821; Mississippi Valley Barge Line 292 282, 286 287,8 692, 693—694, 78 1260. After our statutory involved, we detect no disturb finding.9 II. 20 even admitting protest arbitrary if 'consistent public interest.' statute entrusts duty decide what considerations than those specifically mentioned 5(2)(c) given weight. Cf. McLean 321 67, 86—88, 370, 380—381, 544; Schwabacher 334 182, 193, 68 958, 92 1305. certificate, chosen give weight applicant's fitness. E.G., Transamerican Inc. Control Merger—The Cumberland Express Corp., 423, 428; cf. 207, 551, 307, 307. Integral fitness willingness ability fulfill obligations Commission, demonstrated past continuing violations regulations. E.g., Powell—Purchase—Rampy, 57 597. contested relevance consistency selfevident. Nor dispute principle recently stated Central Georgia Control, I.C.C. 39, 43, alone bar unless, 'upon clearly appears served best approval.' Rather, contend refused consider presented and, effect, automatic subsequent merger. To support allegation, undisputed findings willful, flagrant, persistent disregard regulation. They compare holdings overlooked absence willfulness, conclude rule applied automatic. 21 necessarily arbitrary. already noted, intergral success scheme. encourage others whose consistent either fait accompli avoid altogether. pointed Georgia, encouraged, 'our administration would seriously hindered, defeated.' I.C.C., 44. proper places applicant heavier burden violations, mere willfulness innocence need suffice. 22 fact, way clear showing approval. cannot attack less stringent since merged service larger denying therefore affirmed. III. 23 final requires terminate violation. No reference divestiture can found. view recommendation approved, recommendations remedy simply applicants hereby 'required violation.' reinstated 4's order, added, explanation report, divest. attempted rationale suggesting suited nature acquisition, necessary. 24 There little question since, respect party 'take action necessary, prevent continuance 5(7). effective remedy. itself implies, corrective, punitive. justification removal 25 equitable powers expunge fully developed context antitrust laws is, many respects, 'most drastic, most effective' remedies And '(i)f concludes measures redress element effctive relief, Government denied latter because economic hardship, severe, result.' E. duPont Nemours 366 316, 326—327, 81 1243, 1250, 318. Our 'complete efficacious prohibitions statute' injury interests private parties public. American Tobacco 221 106, 185, 31 632, 650, 55 663. cases indicate, choice important decision initial construction court heavy responsibility tailor effectuate remedial objectives described. Hecht Bowles, 321, 329—331, 587, 591—592, 754. 26 expressly states, choosing accordingly limited. extends ascertain allowable judgment remedy.' Jacob Siegel Federal Trade Comm'n, 608, 612, 758, 760, 888. But prerequisite made, heard issue, applied. find Rather occurred act acquiring plus could conceivable discontinued addition willful parties' proceeding make responsive regulation future. 27 referring mitigating considerations, prejudging implying unwarranted treatment issue. These merely indicate raised remand purely academic sake procedural regularity. considered opinion, propriety ripe supra; Administrative Procedure 8(b), 60 242, 1007(b), 1007(b). 28 reversed remanded conformity opinion. 29 ordered. 30 Reversed remanded. seq., hereinafter referred 'the Act' alone. 'Interlining' shipment destination, transfers delivery. 'Interchanging' switch trailers transfer. interchange involves quantity, exchange obviates necessity unloading trailer transferor loading transferee. shipment-trailer empty loaded direction. transferee's leg journey. transferee, exchange; instead transferee completion trip. Edward D. Sheatestified manager, John Kashady, informed him regularly employed. lists names drivers keeps doctor's certificates file. Other often hired during sometimes day. triplease arrangement Nelson-Gilbertville Monson, open lot possible, empty, unguarded receipt less-than-truckload shipments. testimony ambiguous but, anything, supports occurrence. Shea testified observed hire dispatch Newton. He teletype message employees. incident disputed hear remarks made. hand, turn request occasion, (6) specific instances accomplished aid intermediary. conclusively presumed whenever person 'affiliated' joins acquire, acquires. carrier. 5(6) that: 'For affiliated if, relationship *, believe affairs carrier.' Parenthetically, 'by of, Committee reports passage purpose follows: 'These paragraphs planned light done myriad *. provisions ((4)) unless contained therein indirectly combinations interests. ((5)), ((6)) sure covers types S.Rep.No.87, 73d Cong., 1st Sess., pp. 9—10; H.R.Rep.No. 16—17. House manager bill observed, 77 Cong.Rec. 4857: 'The unifications groupings entirely opportunity correct condition, companies defeat will, drawn.' Concrete examples counsel Walter Splawn Commissioner Joseph Eastman Hearings H.R. 9059 Foreign Commerce, 72d 21—25, 34, 48—50, 61, 69—74 (1932). Hearings, op. cit., note 16—19, 24—26; H.R.Rep.No.650, 66th 2d 63—64 (1920). 764, gave following test reviewing Communications word 1064, 47 152(b), 152(b): 'This So long there warrant expert body stand.' evidence, unnecessary alternative meaning variations statement insignificant quotes giving citations statement. 'trivial' 'irrelevant,' should findings. out, disagreements minor affect substance Communist Party Subversive Activities Board, 367 1, 1357, 1395, 625.

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