Court Opinion

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Opinions of the United
1997 Decisions                                                                                                             States Court of Appeals
                                                                                                                              for the Third Circuit

1-15-1997

Union Pacific RR v. Ametek Inc
Precedential or Non-Precedential:

Docket 96-7015

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                 UNITED STATES COURT OF APPEALS
                     FOR THE THIRD CIRCUIT

                        _________________

                           No. 96-7015
                        _________________

   UNION PACIFIC RAILROAD CO.; MISSOURI PACIFIC RAILROAD CO.;
NORFOLK AND WESTERN RAILWAY CO.; SOUTHERN RAILWAY CO.; BURLINGTON
      NORTHERN RAILROAD CO.; CONSOLIDATED RAIL CORPORATION;
                      CSX TRANSPORTATION CO.

                                v.

             AMETEK, INC.; UNITED STATES OF AMERICA;
                  SURFACE TRANSPORTATION BOARD

    Union Pacific Railroad Co.; Missouri Pacific Railroad Co.;
 Norfolk & Western Railway Co.; Southern Railway Co.; Burlington
       Northern Railroad Co.; Consolidated Rail Corporation,
                                       Appellants.

                        _________________

         An Appeal from the United States District Court
             for the Middle District of Pennsylvania
                       D.C. No. 90-cv-1396
                        ________________

                    Argued September 18, 1996

       Before:   NYGAARD, ROTH, AND ROSENN, Circuit Judges

                         Filed January 15, 1997
                        _________________

Paul D. Keenan, Esquire (argued)
Buchanan Ingersoll, P.C.
Two Logan Square, 12th Floor
18th and Arch Streets
Philadelphia, PA 19103
Counsel for Appellants

James E. Howard, Esquire (argued)
William R. Matthews, Esquire
Kirkpatrick & Lockhart, LLP
One International Place
Boston, MA 02110-2637
Counsel for Appellee Ametek, Inc.

Anne K. Bingaman, Assistant Attorney General

                                1
John J. Powers, Esquire
John P. Fonte, Esquire
Department of Justice
Washington, DC 20530
Counsel for Appellee United States of America

Henri F. Rush, General Counsel
Evelyn G. Kitay, Esquire (argued)
Surface Transportation Board
Washington, DC 20423-0001
Counsel for Appellee Surface Transportation Board

                          _________________

                         OPINION OF THE COURT
                           _________________

ROSENN, Circuit Judge.

          The appeal in these consolidated cases raises questions

of first impression in this circuit relating to the symbiotic

power of a United States district court and the Interstate

Commerce Commission (ICC)1 to render judgment for demurrage fees2

against an entity which is not a party to any transportation

contract with a railroad.    The plaintiffs, six national freight

carriers (the Interline Railroads) sued Ametek, Inc. in the

1. The ICC Termination Act of 1995 (ICCTA), Pub. L. No. 104-88,
109 Stat. 803, abolished the ICC and transferred many of its rail
functions to the Surface Transportation Board (STB). The
demurrage functions at issue in this proceeding which were
formerly performed by the ICC are vested in the STB by virtue of
49 U.S.C. § 11122, as reenacted by the ICCTA. We will refer to
the agency as the ICC.

2. As to railroads, demurrage is "a charge exacted by a carrier
from a shipper or consignee on account of a failure to load or
unload cars within the specified time prescribed by the
applicable tariffs . . .." Black's Law Dictionary 432 (6th ed.
1990). Railroads charge shippers and receivers of freight
"demurrage" fees if the shippers or receivers detain freight cars
on the rails beyond a designated number of days.

                                  2
United States District Court for the Middle District of

Pennsylvania to recover $297,270 allegedly due under a demurrage

tariff issued by the Panther Valley Railroad Company (Panther

Valley), now defunct.    Panther Valley had assigned its demurrage

claim against Ametek to the Interline Railroads.    Ametek receives

plastic materials by rail at Nesquehoning, Pennsylvania which it

processes and then ships by rail to the material suppliers'

customers.

             The district court, on motion of Ametek, referred one

issue to the ICC:    the reasonableness of a demurrage charge.   The

ICC, however, determined preliminarily that the tariff had no

application to Ametek because it was neither the consignor nor

consignee of the shipped goods, and had not assumed contractual

liability.    The district court adopted the ruling of the ICC and

concluded that Ametek had not entered into any separate agreement

obligating it to pay the demurrage fees.    It therefore entered

summary judgment for Ametek and the ICC and denied the Interline

Railroads' motion for summary judgment.    We affirm.

                                  I.

             The demurrage charges assigned by Panther Valley

allegedly accrued under its tariff during 1987 through 1989

inclusive.3    Ametek's customers ship the raw materials by rail to

3. The plaintiffs premise jurisdiction in their action on 28
U.S.C. § 1337. We have jurisdiction under 28 U.S.C. § 1291, this
being an appeal from a final judgment.

                                  3
Ametek's plant by private rail car.    Panther Valley and its

predecessor had provided rail service over a period of about

eight years without demurrage charges.    The practice of Ametek's

customers was to alert Ametek as to whether the loaded cars

should be delivered to Ametek promptly or be held on Panther

Valley's tracks for later delivery.

            In 1986, Ametek had a need to store privately owned

empty and inbounded loaded rail cars for extended periods of

time.    The president of Panther Valley initiated discussions with

 Ametek's rail consultant concerning a side track agreement

between Ametek and Panther Valley for such cars.    Eventually on

April 22, 1996, Panther Valley's president submitted a proposed

side track agreement to Ametek's vice-president in which Ametek

would lease track to accommodate a seasonal overflow of rail cars

experienced by Ametek.    In August 1986, the president of Panther

Valley sent a letter to Ametek setting forth the terms of a

second proposed side track lease agreement.    Ametek would pay

Panther Valley 65 cents per car per day stored on Panther Valley

track.    For reasons unknown to all involved, the agreement "fell

through the cracks" and was never signed.    All parties concede

that if the agreement were in force, Ametek would not be liable

for demurrage fees.

            In 1987, Panther Valley unilaterally imposed a

demurrage tariff of $20 per car per day for the first two days

that a company held rail cars beyond a free period of 48 hours.

                                 4
The tariff increased to $30 for each of the next two days, and

$40 for each subsequent day.    The parties disagree as to whether

Ametek was informed of this tariff.

           In the face of severe financial problems, Panther

Valley, in January 1990, billed Ametek for $297,270 in demurrage

fees for the period March 15, 1987 through October 2, 1989.

Ametek refused to pay the invoice, and suggested that the fair

way to handle the storage problem would be to calculate the

amount Ametek would owe under the aborted lease agreement, which

amounted to $29,664.60.    Panther Valley rejected this proposal

because it would not be in its "best financial interest."    In

June 1990, Panther Valley ceased operations and assigned the

claim to its creditors, six freight carriers (the Interline

Railroads).

           On July 23, 1990, the Interline Railroads brought this

action for demurrage allegedly accrued between March 15, 1987 and

October 2, 1989 (Ametek I).    In response to a motion by Ametek,

the district court stayed its proceedings and referred one issue

to the ICC:    the reasonableness of Panther Valley's demurrage

charges.      The court specifically retained jurisdiction over all

other issues.    Subsequently, Ametek filed a separate complaint

with the ICC claiming that the demurrage rates and practices were

unreasonable.    The ICC consolidated the proceedings.4
4. Because the ICC never issued any ruling pertinent to the
unreasonable practices complaint, the matter became moot and is
not relevant to this appeal.

                                  5
          The ICC stated that before it could determine if the

charges were reasonable, a threshold issue required that it

determine if the tariff could be applied to Ametek at all.

Finding that Ametek was merely the agent of its customers and

neither the consignor nor consignee, the ICC concluded that

Panther Valley could not impose demurrage fees on Ametek.     The

ICC relied on Middle Atlantic Conference v. ICC, 353 F. Supp.
1109, 1116-1121 (D.D.C. 1972) (demurrage tariff does not apply to

agent of party to transportation contract).    The ICC found that

Ametek did not receive, process, or distribute its own materials,

and that Ametek generally was not the consignor or consignee

designated on the bills of lading.

          The Railroads challenged the ICC decision in the United

States District Court pursuant to 28 U.S.C. § 1336(b) by filing

another and separate complaint against the ICC (Ametek II).      The

court consolidated Ametek II with Ametek I.    The ICC, Ametek, and

the Railroads moved for summary judgment.     The court found that

the ICC properly addressed the threshold question whether the

tariff applied to Ametek.   The court determined that the ICC

properly concluded that a demurrage tariff did not apply to a

company that is not a party to a contract of transportation.      The

court then granted summary judgment for ICC and Ametek.    The

Railroads timely appealed to this court.

                               II.

                                6
          Before we discuss the substantive issues raised by the

appellants, the Interline Railroads, we turn to the threshold

question of the jurisdiction of this court to hear this appeal.

Ametek contends that the district court lacked jurisdiction over

Ametek II because the action did not arise out of the question

referred by the district court as to the reasonableness of the

demurrage charges.5   Thus, it maintains that the district court

lacked subject matter jurisdiction pursuant to 28 U.S.C. §

1336(b), and this court therefore cannot exercise appellate

jurisdiction.6

          This court exercises plenary review over matters of

jurisdiction.    Anthuis v. Colt Indus. Operating Corp., 971 F.2d
999, 1002 (3d Cir. 1992).   Title 28 of the United States Code

provides:
When a district court . . . refers a question or issue
          to the Interstate Commerce Commission for
          determination, the court which referred the
          question or issue shall have exclusive
          jurisdiction of a civil action to enforce,
          enjoin, set aside, annul, or suspend, in
          whole or in part, any order of the Interstate
          Commerce Commission arising out of such
          referral.

5. If the district court lacked jurisdiction over this matter,
then principles of res judicata would preclude the Railroads from
pursuing their collection action against Ametek, because the time
period has long since elapsed during which the Railroads could
appeal the ICC determination in Ametek's favor. See infra note
6.

6. Under the Hobbs Act, 28 U.S.C. §§ 2321(a) and 2342, ICC
orders are directly reviewable in the court of appeals. Under 28
U.S.C. § 2344, the petition to review must be filed within sixty
days after the entry of the order. No such petition was filed in
this case, and thus we would lack original jurisdiction.

                                 7
28 U.S.C. § 1336(b) (1994) (emphasis added).

          The district court referred the question of the

reasonableness of Panther Valley's demurrage rates to the ICC.

The ICC, however, did not directly reach this question, because

it determined that the demurrage tariff did not apply to Ametek

in the first instance.   Under § 1336(b), if the question whether

the tariff applied to Ametek arose out of the referred issue as

to the reasonableness of the charges, then the district court

properly exercised jurisdiction over the instant case.

          The district court itself declined to decide whether it

had jurisdiction, stating in a footnote that jurisdiction was

"far from clear."   (Union Pac. R.R. Co. v. Ametek, Inc., No. 90-

1396 at 27 n.18 (M.D. Pa. Sept. 8, 1995) (mem.)).   The court's

primary concern was that the ICC's decision regarding the

threshold applicability of the tariff may have arisen from the

separate complaint filed by Ametek with the ICC challenging the

reasonableness of the tariff rates and the tariff practices

pursued by Panther Valley, rather than from the issue that the

district court referred to the ICC.

          In addressing a similar question in Railway Labor
Executives' Ass'n v. ICC, 894 F.2d 915, 917 (7th Cir. 1990),

Judge Posner noted:
The insight behind section 1336(b) is that if a
          question within the purview of the ICC arises
          in the course of a district court proceeding,
          submission of the ICC's answer in the first
          instance to the district court rather than to
          the court of appeals will avoid a cumbersome

                                8
          and potentially protracted bifurcation of
          judicial review.

          We do not believe that Congress predicated the

exclusive jurisdiction of the district court under 28 U.S.C.

§ 1336(b) on the circumstance that the district court itself must

invoke the jurisdiction of the ICC by making the referral.    We

think the essence of the section is that the district court

should have exclusive jurisdiction over review of the referred

matter even if a party invokes the jurisdiction of the ICC

whenever the district court makes a referral to the agency.    This

interpretation of the law avoids problems arising out of parallel

proceedings in different courts arising out of a single

controversy.

          In its ruling in this case, the ICC stated that

"[w]hile the primary issue raised by the court referral is the

reasonableness of the demurrage charges, before we analyze the

reasonableness of charges we must determine if the demurrage

charges apply.   If demurrage charges do not apply, their

reasonableness is not an issue."    Ametek, Inc. v. Panther Valley

R.R. Corp., No. 40664 at 3 (ICC Jan. 15, 1993) (decision & order)

(citations omitted).   This is a common sense and logical approach

to an analysis of the reasonableness of the charges and the

relationship between the Railroads and the alleged debtor.

          Citing to Island Creek Sales Co v. ICC, 561 F.2d 1219

(6th Circuit 1977), the dissent suggests that we are interpreting

§ 1336(b) "loosely."   Dissent at 4.   Island Creek, however, did

                                9
not construe § 1336(b) and dealt only with the interpretation of

§ 1336(a).    Interpreting that section, the Court of Appeals for

the Sixth Circuit concluded that the petitioners in the case

before it sought "more than money.     They challenge the

fundamental power of the Commission to issue Car Service Order

No. 1050 and the method used to promulgate the demurrage

increases."    Id at 1222.   Thus, this case from a sister circuit

has no precedential or persuasive value.

            The dissent also cites Empire-Detroit Steel Division of

Cyclops Corp. v. ICC, 659 F.2d 396 (3d Cir. 1981), for the

proposition that this court has "adopted Island Creek's strict

interpretation of the district court jurisdiction under §

1336(a)."    Dissent at 4.   Far from supporting the dissent's

position, Empire-Detroit merely reiterates the widely accepted

view that review of ICC decisions which are based upon "legal or

policy grounds" lies with the court of appeals.      Empire-Detroit,
659 F.2d at 397.    In the case at bar, the ICC decision was based

largely upon a factual determination and upon a related matter

emanating from a referral by the district court.    It had no

effect upon the public at large or the powers and policies of the

ICC.

            We conclude that the ICC's decision can fairly be

characterized as related to and arising out of the district

court's referral and that the district court properly exercised

jurisdiction over Ametek II.    They were parallel proceedings

                                  10
arising out of a single dispute and the district court's exercise

of jurisdiction avoided "cumbersome and potentially protracted

bifurcation of judicial review."     We therefore hold that the

district court had subject matter jurisdiction over this matter

pursuant to 28 U.S.C. § 1336(b), and that we have appellate

jurisdiction under 28 U.S.C. § 1291.

                                III.

           We next consider whether the district court applied the

correct standard of review to the ICC ruling.     In its opinion

granting summary judgment for the ICC and Ametek, the district

court stated that "[b]ecause it is evident that the ICC was not

engaged in tariff interpretation, but instead applied its policy

to an otherwise uncontested determination that Ametek was not a

party to a contract of transportation, judicial review is

properly limited to ascertaining whether the ICC decision is

arbitrary, capricious or an abuse of discretion."    Union Pac. at

22.   The Railroads argue that the court should have reviewed the

ICC's decision de novo because the ICC was merely interpreting

common law agency principles.

           In Hi Craft Clothing Co. v. NLRB, 660 F.2d 910, 915 (3d
Cir. 1981), this court stated that when an issue falls outside of

an agency's area of expertise, and the courts have special

competence in that area, there is little reason for the court to

defer to the agency's interpretations.     And in the instant case,

                                11
the ICC acknowledged that the "courts are the primary authority

on matters such as agency and contract law."   Panther Valley at

4.   However, the application of agency law was not necessary to

the ICC's determination.7   The Railroads concede in their brief

to this court that "[t]he bills of lading . . . in almost all

cases listed Ametek as the agent for the consignee or the

consignor."   Although the district court correctly applied the

abuse of discretion standard, we also note that, in fact, the

court engaged in a far more searching analysis of the ICC

determination.   We conclude that the ICC merely applied its own

policies to uncontested matters of fact, and that the district

court committed no error in its standard of review.

                                IV.

           We turn now to the central issue in this case:    Whether

the district court erred in accepting the ICC's determination

that the Panther Valley demurrage tariff could not be applied to

Ametek.   This inquiry involves two separate questions.     First,

did the court err in adopting the ICC's conclusion that the

demurrage tariff may not be applied to Ametek because Ametek was

not a party to the underlying transportation contracts?     Second,

7. Indeed, it might be argued that a finding of agency was
superfluous; that it would have been sufficient simply to
determine that Ametek was not a party to the day to day
transportation contracts. See, e.g., Southern Pac. Transp. Co.
v. Matson Navigation Co., 383 F. Supp. 154, 157 n.5 (N.D. Cal.
1974).

                                12
did the court err in concluding that no other contractual basis

exists which would allow the Railroads to apply the tariff?

                                A.

          In its memorandum opposing the Railroads' motion for

summary judgment, the ICC recites its "longstanding policy not to

extend demurrage tariffs to persons who are not parties to the

transportation contract."8   The ICC decision itself states that

"the Commission has applied this legal principle in a number of

cases," and cites particularly to Payment of Detention Charges,

Eastern Central States, 332 I.C.C. 585, 588 (1968), aff'd 335

I.C.C. 537 (1969) (unlawful to "place liability for detention

charges9 upon a person not a party to the contract of

transportation").

          With little federal court precedent upon which to draw,

both the ICC and the district court in this case relied primarily

upon Middle Atlantic Conference v. ICC, 353 F. Supp. 1109 (D.D.C.

1972) (unlawful to impose liability for demurrage charges upon

agent who was not a party to the transportation contract).    After

8. The policy extends at least as far back as 1920. See New
York Board of Trade v. Director General, 59 I.C.C. 205, 209
(1920) (noting that a "steamship company is not a party to the
contract of transportation over the rail lines and cannot be held
liable by the rail carrier for demurrage").

9. "Detention" and "demurrage" are terms used by motor carriers
and railroads, respectively, to describe the same thing. The
legal principles discussed apply to both motor carrier detention
and railroad demurrage charges.

                                13
speaking approvingly of the Eastern Central decision, the court

in Middle Atlantic noted that "[t]he law is well settled that an

agent for a disclosed principal is not liable to a third person

for acts within the scope of the agency." 353 F. Supp. at 1120-

21 (citations omitted).

          In the instant case, it is undisputed that Ametek was

not a party to the transportation contracts.    We therefore

perceive no error by the district court in adopting the ICC's

determination that liability for the demurrage tariff could not

be imposed on Ametek as the consignee or an agent of the

consignor.

                                  B.

             The Railroads argue that the ICC and the district court

failed to address an exception to the general rule as stated in

Part IV A supra:    that agents may assume liability contractually.

 The Railroads assert that Ametek separately agreed to the

demurrage liability in the instant case.    This court reviews the

district court's finding of facts for clear error.    See North
River Ins. Co. v. CIGNA Reinsurance Co., 52 F.3d 1194, 1203 (3d

Cir. 1995).

          The court in Middle Atlantic stated the exception to

the rule of non-liability for agents:     "Certainly warehousemen

are free to assume liability for detention charges by contractual

undertaking . . .. " 353 F. Supp. at 1121-22.   The Railroads

                                  14
contend that Ametek independently agreed to be liable for the

demurrage tariffs.   They assert that Ametek hired a railroad

consultant and negotiated the failed lease agreement to avoid the

demurrage costs.   Thus, the Railroads conclude that Ametek was

aware of its liability, and chose to limit it through a

negotiated agreement.    In the absence of the track or lease

agreement, they argue, Ametek is liable for the full demurrage

cost.

          The district court noted that an agent may agree to be

liable for demurrage charges, but found that there was no such

agreement between Ametek and Panther Valley.    The court discussed

the proposed rental agreement between the parties, but pointed

out that the parties never signed the agreement and aborted it.

The court noted that the Railroads presented no evidence that

Ametek ever intended to agree to demurrage fees.    Past dealing

between the parties reveal that neither Panther Valley nor its

predecessor, Conrail, ever charged Ametek with a demurrage

tariff.   Further, as the district court noted, Panther Valley was

free to seek demurrage charges from Ametek's clients, the actual

parties to the shipment contracts.

          We find no error in the district court's finding of

fact that Ametek and Panther Valley never entered into a contract

binding Ametek to the payment of demurrage fees.    There is no

evidence that Ametek intended to assume contractual liability for

the demurrage charges.    We have only a proposed draft of a

                                 15
contract which was never signed and is thus, of course,

unenforceable.   Neither we nor the district court are in a

position to speculate as to Ametek's motivations in entering into

the contract negotiations.   We see no error in the district

court's decision that no contractual exception to the agent non-

liability rule is present in this case.

                                 V.

            We conclude that the district court committed no error

in adopting the ICC's determination that Ametek may not be held

liable for demurrage charges under Panther Valley's tariff.

Ametek was not a party to the underlying transportation

contracts, and it did not separately agree contractually to

accept liability.

            Accordingly, the summary judgment in favor of the ICC

and Ametek will be affirmed, as will the order of the district

court denying the motion of the Interline Railroads for summary

judgment.   Costs taxed against the appellant Railroads.

                                 16
         Union Pacific Railroad, et al. v. Ametek, Inc.

                           No. 96-7015

Roth, Circuit Judge, Dissenting:

          I respectfully dissent from the majority’s opinion

because I do not think the district court had jurisdiction to

review the ICC’s order in this case.

          Except as otherwise provided by Congress, Title 28

U.S.C. §2321 vests exclusive jurisdiction in the federal courts

of appeal to “enjoin or suspend, in whole or in part, a rule

regulation, or order” of the Interstate Commerce Commission (now

Surface Transportation Board).   28 U.S.C. §2321.   In addition,

under 28 U.S.C. §2342(a), “The court of appeals . . . has

exclusive jurisdiction to enjoin, set aside, suspend (in whole or

in part), or to determine the validity of ... (5) all rules,

regulations or final orders of the [ICC] made reviewable by §2321

of this title.”   As these statutes demonstrate, the courts of

appeal ordinarily have jurisdiction over cases in which a party

seeks to challenge an ICC decision.

                                 17
             I recognize that there are exceptions to this general

rule.   For example, under 28 U.S.C. §1336(b), a district court

retains exclusive jurisdiction over a civil action to review an

ICC order when that order arises out of a prior referral.

However, I conclude that the ICC’s order in this case does not

fit the “arising out of” language of § 1336(b).

           Ametek initially sought to have the district court

refer two issues to the ICC:   the reasonableness of Panther

Valley’s rates and the reasonableness of Panther Valley’s

practices in negotiating a contract to force Ametek to pay

demurrage charges.   The district court, however, specifically

limited its referral to one issue, the reasonableness of Panther

Valley’s rates.   Ametek then filed a separate proceeding directly

with the ICC regarding the reasonableness of Panther Valley’s

practices.   The ICC consolidated this separate proceeding with

the issue already referred to it by the district court.   The ICC

then issued an opinion declaring Ametek not liable for demurrage

charges under common law principles.   The ICC did not rule on the

reasonableness of Panther Valley’s rates.

           I disagree with the majority that the ICC’s decision

regarding Ametek’s liability for demurrage charges arose out of

the district court’s referral within the meaning of §1336(b).

True, the ICC may have felt that a decision regarding the

reasonableness of Panther Valley’s rates dictated a determination

of whether the rates applied at all.    Nevertheless, the ICC’s

                                 18
legal authority for making this determination did not originate

in the district court referral.    It was specifically presented to

the ICC in Ametek’s separate action filed directly with the ICC.

           Moreover, the ICC acknowledged that it was going beyond

the scope of its expertise and, indeed, beyond the specific

referral from the district court when it stated:

     We are aware that courts are the primary authority on

     matters such as agency and contract law.   However,

     where the applicability and reasonableness of

     interstate railroad transportation contracts are at

     issue, our expertise and precedents are also due

     consideration.   See 49 U.S.C. 10501(d).

The ICC’s invocation here of 49 U.S.C. §10501(d) is significant

because it demonstrates that the Commission was relying not on

the district court’s referral, but on the ICC’s own inherent

authority to review the rules and practices of rail carriers.10

           Furthermore, when the district court affirmed the ICC’s

authority to consider the issue of liability, the district court

suggested that it was Ametek’s separate complaint which provided

the ICC with the authority to rule on Ametek’s liability for the

charges.   The court first noted that
     10
      § 10501(d) states in pertinent part: “The jurisdiction of
the Commission . . . over transportation by rail carriers, and
the remedies provided in this subtitle with respect to the rates,
classifications, rules, and practices of such carriers, is
exclusive.”

                                  19
 [B]ecause 49 U.S.C. §11701(b) permits the ICC   to dismiss only
      those complaints filed with it that fail   to “state
      reasonable grounds for investigation and   action,” the ICC
      was statutorily obligated to address the   separate
      complaints filed by Ametek.

 Union Pac. R.R. Co. v. Ametek, Inc., No. 90-1396 at 15 (M.D. Pa.

Sept 8, 1995) (mem.). The district court went on to state:
Notwithstanding the parties’ agreement that this Court has
      jurisdiction over the ICC Decision pursuant to 28 U.S.C. §
      1336(b), I am constrained to note that jurisdiction is far
      from clear. . . . Only the reasonableness of demurrage
      rates was referred to the ICC in this case. While it may
      have been proper for the ICC to address the threshold
      question of tariff applicability, that issue was presented
      as a result of separate complaints filed by Ametek. It
      thus could be argued that the ICC Decision does not arise
      out of the referral in this case, so that any challenge to
      the ICC Decision should have been pursued in the
      appropriate court of appeals.

Union Pac. R.R. Co., No. 90-1396 at 27 n.18 (emphasis added).       I

agree with the district court’s statement that one could argue

that the ICC’s authority to consider Ametek’s liability for

demurrage charges did not stem solely from the district court’s

referral.   In fact, the ICC’s authority to consider the

reasonableness of Panther Valley’s practices stemmed from

Ametek’s separate proceeding filed directly with the ICC.     I

conclude, as a consequence, that the district court lacked

jurisdiction to review the ICC’s order under §1336 (b).

            My conclusion is supported by a similar situation which

the Sixth Circuit confronted in Island Creek Sales Co. v. I.C.C.,
561 F.2d 1219 (6th Cir. 1977).   In Island Creek, the court

interpreted the scope of the jurisdiction under 28 U.S.C.

§1336(a), which provides for district court review of ICC orders

                                 20
that concern the payment of money or collection of fines.       The

shippers challenged the ICC’s power to promulgate certain

demurrage increases.    Since the case involved the validity of the

ICC’s order for the payment of money and not just the amount

payable, the Sixth Circuit held that the case was within the

appellate court’s exclusive jurisdiction.    Id. at 1222.   The

nature of the issue to be reviewed    -- the ICC’s power to

promulgate increases and not merely the amount of the increase --

placed the appeal beyond the scope of the narrow jurisdictional

exception created for the district court by § 1336(a).

            Island Creek is analogous to this case because it

involves the scope of the jurisdiction for district court review

created by §1336.    Moreover, we have adopted Island Creek’s

strict interpretation of district court jurisdiction under

§1336(a) in Empire-Detroit Steel Division of Cyclops Corp. v.

I.C.C, 659 F.2d 396 (3d Cir. 1981).11   I see no reason to apply a

strict interpretation to §1336(a) and a looser interpretation to

§1336(b).    The majority seem, however, to interpret §1336(b)

loosely.    I believe to the contrary that we should interpret

§1336(b) strictly and limit district court appellate jurisdiction

to the express language of the statute.

     11
      In Empire-Detroit we stated: “We agree with those courts
of appeals which have held that review of orders denying
reparations on legal or policy grounds is available by petition
for review in the courts of appeals.” Empire-Detroit, 659 F.2d at
397.

                                 21
            Finally, I disagree with the majority’s reliance on

Judge Posner’s opinion in Railway Labor Executives’ Association

v. I.C.C., 894 F.2d 915 (7th Cir. 1990).    In RLEA, the Seventh

Circuit interepreted the referral language of § 1336(b) and

concluded that district courts must make some positive

“reference” to the ICC in order to invoke the referral

jurisdiction provided by the statute.    The purpose of such a

reference is “so that the parties can be in no doubt of which

court to go to for judicial review of the ICC order.”    Id. at

917.12    In a situation such as the case before us, where the ICC

has simultaneously considered a question referred by the district

court and a proceeding filed directly with the ICC, it seems to

me that a bright line rule is most helpful to the parties in

determining where to file an appeal.    I submit that only those

issues should be appealed to the district court which were

expressly referred to the ICC by the district court.     I do not

concur in the majority’s implication that the word “order,” as it

is used in §1336(b), is broader in scope than the word “issue.”

To the contrary, I believe the statute provides for district

court review of solely those issues it has referred to the ICC.

Any other issues decided by the ICC in a parallel proceeding,

such as we have here, should be appealed to the court of appeals.

     12
      The issue in RLEA was whether the transmittal of a
question by the bankruptcy court to the ICC was a “referral” if
the word “refer” was not employed. The court concluded that it
was a referral.

                                  22
           The application of such a strict interpretation of §

1336(b) would reduce the chance that appeals are made to the

wrong court.   Counsel need only look to the language of the

district court’s referral to determine whether the issue was

properly reviewable by a district court under §1336(b).   If the

issue was not one specifically referred to the ICC by the

district court, it would be reviewable only by the court of

appeals.   This regime would eliminate uncertainty among the

parties and obviate complicated inquiry over the exact source of

the ICC’s authority to determine a separate issue, be it the

referral, a separate proceeding, or some other statute.

             Because the propriety of Panther Valley’s practices

was not an issue referred to the ICC by the district court, I

conclude that the appeal of that issue should have come directly

to the court of appeals.   For this reason, I find that the

district court should not have heard the appeal from the ICC and

I respectfully dissent.

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