Court Opinion

ID: 7861753
Source: CourtListenerOpinion
Date Created: 2022-09-08 17:55:42.861603+00
Date Added: 2024-06-11T16:31:00.306295
License: Public Domain

SILBERMAN, Circuit Judge,
concurring:
The majority opinion is quite ambiguous as to whether the Commission’s interpretation of the statute is affirmed because it is a permissible construction or because it is the only acceptable construction. The majority does not even mention Chevron U.S.A. Inc. v. Natural Resources Defense Council, Inc., 467 U.S. 837, 104 S.Ct. 2778, 81 L.Ed.2d 694 (1984), the governing Supreme Court case dictating the manner in which the judiciary must review agency construction of their authorizing legislation. I write separately, then, to explain why the majority opinion must not, indeed could not, be interpreted as holding more than that the Commission’s interpretation is a permissible one. The Commission should not be barred in the future from adopting another, more pro-regulatory, interpretation of the ICC’s exemption authority, perhaps more sympathetic to the interest of affected workers.
The key provision in dispute is § 10505. (a) In a matter related to a rail carrier providing transportation subject to the jurisdiction of the Interstate Commerce Commission under this subchapter, the Commission shall exempt a person, class of persons, or a transaction or service when the Commission finds that the application of a provision of this subtitle—
(1) is not necessary to carry out the transportation policy of section 10101a of this title; and
(2) either (A) the transaction or service is of limited scope, or (B) the application of a provision of this subtitle is not needed to protect shippers from the abuse of market power.
49 U.S.C. § 10505(a).
This provision, by using the word “shall,” imposes an obligation on the Commission to provide the exemption if the requisite criteria are met. But at least on its face subsection (1) leaves the Commission with a broad discretion to determine whether an application of a provision is necessary to carry out “the Railroad Transportation Policy” (RTP), which is a “wish list” of imprecisely drafted, overlapping, and somewhat contradictory policy goals. The language of § 10505(a) does not even purport to limit the Commission as to which of these 15 goals is to be considered when the Commission decides whether to grant an exemption from the requirements of a particular section of the statute. We have previously said that the Commission need not “address each and every one of the policy’s fifteen components, for some may be completely unrelated to the exemption. It does mean, however, that the Commission must consider all aspects of the policy bearing on the propriety of the exemption,” Illinois Commerce Comm’n v. ICC, 787 F.2d 616, 627 (D.C.Cir.1986) (emphasis added; footnotes omitted). In that case we reversed and remanded the ICC’s rules expediting abandonment proceedings for failure to consider several RTP factors the court thought “relevant” to the exemption. Id. at 632. We did not suggest that RTP factors were relevant in an exemption determination only if they were directly and specifically implicated in the underlying regulatory provision. Indeed, the tone, if not the holding of our opinion, as the language quoted above indicates, suggests that the Commission should be inclusive rather than exclusive in determining RTP factors to be considered in exemption determinations — which is, of course, why petitioners rely so heavily on that opinion. In our case, however, the Commission in granting the exemption declined to consider any RTP factor that it thought was not subsumed or directly implicated in the underlying substantive provision, § 11344 from which the exemption was sought.
That provision reads as follows:
(d) In a proceeding under this section which does not involve the merger or control of at least two class I railroads, as defined by the Commission, the Commission shall approve such an application unless it finds that—
*286(1) as a result of the transaction, there is likely to be substantial lessening of competition, creation of a monopoly, or restraint of trade in freight surface transportation in any region of the United States; and
(2) the anticompetitive effects of the transaction outweigh the public interest in meeting significant transportation needs.
49 U.S.C. § 11344(d).
Petitioners argued that the Commission cannot properly limit its scope of inquiry or consideration of RTP factors to ask only whether the proposed exemption would serve competition — and particularly that the Commission should consider RTP factor (12) instructing the Commission “to encourage fair wages and safe and suitable working conditions in the railroad industry.”
The AU did just as petitioners asked. He believed that the Commission can deny the exemption because of “one factor, for example, the effect on working conditions” and recommended the denial because: “I believe that the Commission should conclude that the subject transaction has no substantial purpose other than employee removal and deny the application on the basis of a breach of the [RTP].” ALJ Initial Decision (AU I.D.) at 20. The AU was obviously referring to § 10101a(12).1 The ICC reversed, but it is extremely important to note carefully what the Commission said and did not say. The Commission reasoned that:
Under section 11344, Congress has limited the Commission’s jurisdiction to consideration of whether a transaction would have a substantial adverse impact on competition. If the Commission finds no substantial adverse impact it must approve the transaction. Accordingly, our analysis in the exemption context need not be broadened beyond consideration of those aspects of the RTP that deal with competition. We need not look at RTP issues unrelated to the purpose of section 11344. The RTP criteria must be analyzed, but in a way that does not subject the applicable factors to a higher level of scrutiny than would apply in the context of a formal application.
Finance Docket Nos. 31,472 & 31,485, Indiana Rail Road Co. — Petition for Exemption — Illinois Cent. R.R. Co., served Aug. 7, 1990, at 3 (ICC Decision) (footnote omitted) (emphases added).
Thus the Commission did not say that the statute must be interpreted to preclude the Commission “in the exemption context” from considering RTP factors which arguably do not directly bear on the criteria used in the substantive statutory provision. The Commission was content to hold that under its reading of the statute it was not obliged to consider RTP factors other than those subsumed within section 11344. Although section 11344 requires consideration of the public interest (which would certainly encompass all of the RTP factors) the Commission is to do so only if it finds that a proposed transaction is anticompetitive. Under a full-blown section 11344 proceeding, once the Commission finds that a transaction is pro-competitive it must stop its inquiry and approve the merger. Therefore, the Commission reasons that in applying section 10505(a), the exemption provision to section 11344, its deliberations should parallel the process called for in section 11344 itself. The Commission, accordingly, should not even consider factors that do not directly bear on competition when determining whether an exemption should be granted. “The RTP criteria must be analyzed, but in a way that does not subject the applicable factors to a higher level of scrutiny than would apply in the context of a formal application.” ICC Decision at 3. By “higher level of scrutiny” the Commission evidently means taking into account a broader number of factors. That seems to me a quite reasonable construction of the statutory language but it is hardly inevitable.
Although the majority describes the petitioners as asking that the Commission *287make a “finding” as to the other than competitive factors, that is not quite accurate. The petitioners asked only that the Commission consider other RTP factors before it “finds” that “the application of [the Interstate Commerce Act] is not necessary.” I can well imagine another Commission, perhaps less committed to deregulation, reasonably interpreting the two sections of the statute as permitting the Commission to consider, at least briefly, factors other than those focusing on enhancing competition when determining whether to grant an exception under § 10505(a) from § 11344. Such a future Commission might well reason that it is permitted under § 11344 to ignore the public interest only if it determines after the full-blown procedures of that section that a proposed transaction will have no anticompetitive effect. Because without the full procedures the Commission may have less confidence in its own determination of the proposed transaction’s impact on competition, it might well wish to take a quick look at the other public interest factors, namely the RTP factors, before granting an exemption.
Certainly there is nothing in the express language of the statute which limits the Commission’s authority to take such an approach. As I said earlier, Congress was completely silent as to RTP factors to be considered by the Commission with respect to any given exemption request. No one has suggested any legislative history that would reveal a specific intent on the point. Moreover, the RTP factors are hardly precisely drafted and are not mutually exclusive. The Commission never even specified which of these factors were directly relevant in this case. The majority only deduces that the Commission meant to refer to section 10101a(l), (4), (5) and (13). Indeed, the language of section 10505(a) might actually be thought to point more to petitioners’ construction than the Commission’s. It will be recalled that the exemption provision has two criteria which must be applied, and the second includes the language “the application of a provision of this subtitle is not needed to protect shippers from the abuse of market power.” 49 U.S.C. § 10505(a)(2)(B). Certainly that concept is at the core of any concerns about competitiveness. The criterion that the statutory section from which an exemption is granted “is not necessary to carry out the transportation policy of section 10101a,” was not intended to be limited to competitiveness concerns.
In sum, the issue presented to us by petitioners — whether the Commission must consider more than competitiveness factors in approving an exemption from section 11344 — is a paradigm Chevron “Step II” issue. Chevron, 467 U.S. at 843-44, 104 S.Ct. at 2782; General Motors Corp. v. NHTSA, 898 F.2d 165, 169 (D.C.Cir.1990); Bridgestone/Firestone v. Pension Benefit Guar. Corp., 892 F.2d 105, 110-11 (D.C.Cir.1989). Congress has not directly addressed the question and so we must defer to any reasonable agency interpretation. Particularly since the agency in its opinion claimed only that it was not required by the statute to consider more than it did, it would be astonishingly inappropriate for us to say or even imply that the Commission could not have considered other factors if it wished.
Whatever may be the Commission’s general authority under section 10505 to consider RTP factors not concerning competitiveness when considering a grant of an exemption from § 11344, the real issue is this case centers on the Commission’s rejection of the ALJ’s concern for the impact of the proposed transaction on employees.2 And here I think the majority misunderstands both the relationship between § 11344 and § 11347 and the Commission’s decision. It is simply not so that the Commission must authorize a transaction under *288§ 11344 if only the two criteria set forth in that section are met. Section 11347 imposes another separate condition:
When a rail carrier is involved in a transaction for which approval is sought under sections 11344 and 11345 or section 11346 of this title, the Interstate Commerce Commission shall require the carrier to provide a fair arrangement at least as protective of the interest of employees who are affected by the transaction as the terms imposed under this section before February 5, 1976, and the terms established under section 405 of the Rail Passenger Service Act (45 U.S.C. 565).
49 U.S.C. § 11347.
It is undeniable that § 11347 labor protective provisions directly implicate the fair wages and suitable working conditions goal of the Railroad Transportation Policy. To be sure, as the majority notes, the Commission required that the so-called New York Dock protective provisions be applied, providing employees with a level of protection that the Commission traditionally imposes in approving a § 11344 transaction, but that is hardly the point: The point is that even following the majority’s own logic section 10101a(12) is just as relevant to the Commission’s consideration of this exemption as sections 10101a(4), (5), and (13) because the Commission must consider the transaction’s impact on employees in the “full-blown” § 11344 proceedings.
The Commission, as I read its opinion, understood the point; it did not say that it need not (let alone must not) consider section 10101a(12) in granting the exemption. Instead, it said that:
finally we note that the only RTP provision dealing with rail labor (section 10101a(12)) refers to “fair wages and safe and suitable working conditions” ... the wages of the affected IC employees 15 are protected by the imposition of standard labor protection provisions.
ICC Decision at 6. In other words, the Commission did consider the very factor that petitioners claim it should have. The Commission might well have weighed that factor differently and disapproved the exemption (as the AU recommended) and I seriously doubt that we would have any cause to disapprove such a decision.
Paradoxically, the majority is defending the Commission for not doing what it actually did. The Commission did say that under the regular 11344(d) procedure labor concerns are addressed not in that subsection but rather in section 11347, see Maj.Op. at n. 4; but the Commission decidedly did not say that it was not permitted to consider labor concerns when determining whether to grant an exemption to 11344(d). And it most assuredly did not say, as does the majority at the end of n. 4, that the “railroads here did not seek an exemption from § 11347,” implying that by seeking an exemption from 11344(d) alone the railroad could break the statutory link between sections 11344 and 11347. That may be a possible interpretation, but it is not one the Commission adopted.
For all the above reasons, I think it is rather obvious that the court’s holding on the issue of statutory interpretation must be read as limited to affirming a permissible construction and application of the statute. Surely it would be unfortunate if the court’s opinion were read as differing with the Commission and holding that the Commission was obliged to construe the statute as precluding the approach taken by the AU regarding the impact on workers (or indeed the actual construction followed by the Commission). In Chevron the Supreme Court admonished this court not to prevent an agency wishing to relax regulation from interpreting undefined and imprecise statutory language. It would be a cruel twist if we were now to violate Chevron’s principles to freeze present deregulatory efforts against the possibility that future appointees of commissions like the ICC would *289come to office with a different political and economic agenda.

. The ALJ also considered evidence relating to yet another RTP factor concerning the safety of railroad operations, 49 U.S.C. § 10101a(8). He determined, however, that safety is not threatened by this transaction. See ALJ I.D. at 16.

. We have before us as one of the petitioners the omnipresent Patrick W. Simmons, the Legislative Director of the United Transportation Union (UTU). We have previously noted that Simmons does not have standing personally. United Transp. Union v. ICC, 891 F.2d 908, 909 n. 1 (D.C.Cir.1989), cert. denied, — U.S. -, 110 S.Ct. 3271, 111 L.Ed.2d 781 (1990). Only the UTU, as the representative of affected workers, has standing, but nonetheless Simmons continues to petition and file briefs in his own name. After reading far too many of these briefs, I have concluded that the captions of these petitions is the least of the union’s concerns.

 As the AU noted, although 19 IC employees' jobs are affected by these transactions, only one position will be abolished, with the other 18 employees reassigned to other comparable positions in IC’s system. Moreover, IRRC’s operations over the line will require 7 additional employees.