Court Opinion

ID: 9450942
Source: CourtListenerOpinion
Date Created: 2023-08-04 17:01:15.546025+00
Date Added: 2024-06-11T17:32:30.213760
License: Public Domain

On Petition for rehearing before BAZ-ELON, Chief Judge, and WASHINGTON and WRIGHT, Circuit Judges.
ORDER
PER CURIAM.
On consideration of respondent’s petition for rehearing, and of petitioner’s opposition thereto, it is
Ordered by the court that respondent’s aforesaid petition is denied.
PER CURIAM:
In this petition for rehearing, the Commission seeks affirmance of its order and rule on the basis of materials newly submitted to us or, in the alternative, a clarification of our opinion on whether or not the Commission may balance against any “prejudicial loss of confidentiality” its need for the information.
In seeking affirmance, the Commission cites new authority to show that its employees are under a duty of confidence with respect to information coming to them through audit or § 21 reports.1 This authority, all of relatively recent origin,2 is irrelevant to our conclusion that, prior to 1961, Congress never conferred on the Commission powers which would enable it to conduct audits of the books of x’egulated carriers. The Commission has yet to address itself to the mass of legislative considerations which led us to this conclusion.
In seeking clarification, the Commission has apparently misunderstood what we found to be the potential basis for its authority to audit or exercise other powers commonly accorded federal agencies but previously denied to it. That basis is not § 21 of the Act, but the 1961 *763amendment of the Act conferring broad rulemaking power upon the Commission, 46 U.S.C. § 841a. In discussing this amendment, we found from the contemporaneous legislative history that the Commission is required to make two independent findings to support any such exercise of the power: (1) that the rule is necessary to substantive regulation under the act; (2) that the rule will not impose an unequal burden on American-flag carriers vis á vis their foreign-flag competitors. The Commission may find, in particular cases, that the burden to be imposed is de minimus. But balancing the need for regulation against an unequal burden in fact imposed is not permissible.
The Commission’s determination whether a burden is likely to occur may not lightly be disturbed on review since the Commission has close acquaintance with the problems involved and the likely effects of its actions. In the context of audit or other inspection of corporate records, the Commission’s inquiry might include, inter alia, consideration whether: (1) matters discovered are likely to be disclosed to competitors who need not supply like information;3 (2) audit or inspection can be limited to particular records, whose disclosure would not be prejudicial;4 (3) being audited or inspected itself imposes a substantial, unshared burden on American carriers. The purposes of this inquiry will not be served by further piecemeal returns to this court. A complete proceeding at the administrative level, leading to formal agency action, is in order.
Rehearing denied.
J. SKELLY WRIGHT, Circuit Judge, would grant the rehearing.

. 18 U.S.C. § 1905; Federal Maritime Commission Order 53 (as amended).

. 18 U.S.C. § 1905 was enacted in 1948, as part of the general revision of the Criminal Code. It is a consolidation of several previous statutes, none of which appear to have been applicable to employees of the Commission’s predecessors. The effective date of the amended Order 53, which does not appear in C.F.R., is March 11, 1963. We think it inappropriate to consider in advance of the Commission’s action on remand the degree to which these provisions operate to protect against burdensome effects which would otherwise foreclose the exercise of rulemaking authority.

. In its opposition to rehearing, Alcoa stated that the Commission as a uniform practice “releases to interested members of the public any confidential information made use of by the Commission’s staff during [rate investigations].” The Commission has not contradicted this.

. There may be certain types of information about operations in foreign commerce which would not be competitively damaging if revealed; in domestic commerce, as we noted, foreign competition is apparently not present.