Midwest Truck Lines, Ltd. v. Interstate Commerce Commission

269 F. Supp. 554, 1967 U.S. Dist. LEXIS 9275
CourtDistrict Court, District of Columbia
DecidedApril 28, 1967
DocketCiv. A. No. 1013-66
StatusPublished
Cited by6 cases

This text of 269 F. Supp. 554 (Midwest Truck Lines, Ltd. v. Interstate Commerce Commission) is published on Counsel Stack Legal Research, covering District Court, District of Columbia primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Midwest Truck Lines, Ltd. v. Interstate Commerce Commission, 269 F. Supp. 554, 1967 U.S. Dist. LEXIS 9275 (D.D.C. 1967).

Opinion

MATTHEWS, District Judge.

The plaintiff herein, Midwest Truck Lines, Ltd., seeks to set aside an order of the Interstate Commerce Commission denying the contract carrier authority applied for by plaintiff, and to have the Commission directed to issue to plaintiff the permit sought in its application. This three-judge court was convened pursuant to 28 U.S.C. §§ 2284, 2321-2325.

On May 11, 1963, plaintiff made an application to the Interstate Commerce Commission pursuant to Section 209(b) of the Interstate Commerce Act1 for a permit to operate as a contract carrier by motor vehicle over irregular routes. As a Canadian trucking corporation, plaintiff for over 25 years has transported fish from Canada to various midwestern cities in the United States, and in its mentioned application seeks to operate as a contract carrier for Motor Coach Industries, Inc., a manufacturer of buses with a plant located at Pembina, North Dakota, near the Canadian border. In such capacity plaintiff proposes to use its trucks on their return trips to Canada to pick up parts usable in the manufacture and assembly of buses from various suppliers of said manufacturer at 15 points 2 in the midwest, and to haul these parts to the manufacturer’s plant at Pembina, North Dakota.

As ground for the relief sought here plaintiff asserts that the evidence supports its application and meets all criteria which the Commission was called upon to consider, and that the denial of its application was contrary to the evidence and the applicable law, and was arbitrary and capricious, and not consistent with the public interest and the national transportation policy.

An Examiner for the Commission held a hearing on plaintiff’s application at Chicago, Illinois, on October 21, 1963, the application being opposed by six Protestants.3 The Examiner recommended that the application be denied. On October 11, 1965, Division One of the Interstate Commerce Commission issued its report and order denying the application, one Commissioner dissenting. 99 M.C.C. 697. Thereafter, on November 8, 1965, plaintiff filed a petition seeking a finding of “general transportation importance” which would serve to put the case before the entire Commission. The petition was denied November 19, 1965. This action followed on April 19, 1966. The protestants have not sought to intervene herein.

There is no material dispute as to the facts. The Commission, with one exception,4 adopted the Examiner’s statement of facts as its own. As background for the present controversy, the facts will be related.

The Pembina manufacturer, Motor Coach Industries, Inc., herein called Motor Coach, is a Delaware Corporation and a wholly-owned subsidiary of the Greyhound Corporation of Chicago, Illinois, which also has a Canadian subsidiary corporation known as the Greyhound Lines of Canada, Ltd., which, in turn, has a wholly-owned subsidiary known as Motor Coach Industries, Ltd., of Winnipeg, Canada. The latter-named company has a plant at Winnipeg for the manufacture [557]*557of complete buses, which mainly are sold within Canada, but the demand has become greater than its production capacity. To meet demands outside of Canada, Motor Coach was created and a new plant was constructed at Pembina, North Dakota, but the “bus shells” will continue to be manufactured at the Winnipeg plant and then moved by private carriage to the Pembina plant for assembly as completed buses for sale in the American market. The buses manufactured by Motor Coach at Pembina are offered for sale to any bus-operating company that wishes to buy them. Other reasons for the construction of the plant at Pembina were to provide for the shortest possible haul of bus shells from the Winnipeg plant to the Pembina plant, and to reduce the travel distance for the managerial staff between Winnipeg and Pembina.

Completed in May 1963, the plant at Pembina has modern shop facilities and is fully conveyorized. It is designed to produce one bus each working day, or five buses per work week of five days. The total area of the plant is 25,920 square feet. The assembly and test lines take up 85 per cent of the area space, and the remaining 15 per cent is used for storage, rest rooms, heating plant, etc. The plant was arranged with the preconceived plan (1) that its many suppliers at their respective plants would utilize their own storage space to keep the supplies ordered for the Pembina plant until such time as they are needed in Pembina, and (2) that thereby Motor Coach would be able to reduce its initial and continued capital investments in both the use of storage space and the maintenance of large inventories, and thereby ultimately reduce completed-bus costs.

At the hearing before the Examiner, Motor Coach asserted (and it is without dispute in the evidence) that its factory is designed on a continuous flow principle whereby materials coming from suppliers must move in a constant stream through general storage, preassembly, testing and final assembly; that at any one time the Pembina plant’s own storage area can accommodate only enough major components for five buses; that Motor Coach purchases supplies in large quantities from suppliers who keep them in their own storage facilities available for transportation in small lots to the Pembina plant as they are required; that to achieve full production, and to keep its assembly line moving, Motor Coach requires delivery of supplies no later than four days from the time of pickup at the initial origin point; that absent such delivery, costly delays in the assembly process will result; and that the transportation of parts from the plants of suppliers to the plant at Pembina is an integral and vital part of Motor Coach’s total operation.

Each bus manufactured by Motor Coach has many optional facilities. Each purchaser may select various options offered by Motor Coach through its literature. As orders come in from bus operators, Motor Coach will require different items of optional equipment, and the delivery of such optional equipment must be closely tied with its production line. Its requirement for these various types of optional equipment varies from week to week and month to month.

When the hearing took place before the Examiner in October 1963, the Pembina plant was new and was going through a so-called “shakedown” process, that is, a preliminary period of training new employees and generally working out problems existent in any new operation. Motor Coach desired to ascertain whether existing common carrier service would be sufficient to satisfy its needs, and during a five-month trial period from May to October 1963 used such service. The existing common carriers were unable to provide the four-day service to Pembina which Motor Coach requires to produce its planned one bus a day and to prevent a shutdown of its assembly line. The common carriers, according to the Examiner, “from the time of picking up shipments have taken from 5 to 13, or more, days for delivery at Pembina.”

During the twelve-month period prior to October 1963, plaintiff had at least one [558]*558truck available for every day of the year at Chicago, Detroit, Cleveland, Toledo, Akron or Columbus.

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Cite This Page — Counsel Stack

Bluebook (online)
269 F. Supp. 554, 1967 U.S. Dist. LEXIS 9275, Counsel Stack Legal Research, https://law.counselstack.com/opinion/midwest-truck-lines-ltd-v-interstate-commerce-commission-dcd-1967.