Potomac Electric Power Company v. United States of America and Interstate Commerce Commission, Consolidated Rail Corporation, Intervenor

584 F.2d 1058, 190 U.S. App. D.C. 77, 1978 U.S. App. LEXIS 9843
CourtCourt of Appeals for the D.C. Circuit
DecidedAugust 2, 1978
Docket77-1494
StatusPublished
Cited by30 cases

This text of 584 F.2d 1058 (Potomac Electric Power Company v. United States of America and Interstate Commerce Commission, Consolidated Rail Corporation, Intervenor) is published on Counsel Stack Legal Research, covering Court of Appeals for the D.C. Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
Potomac Electric Power Company v. United States of America and Interstate Commerce Commission, Consolidated Rail Corporation, Intervenor, 584 F.2d 1058, 190 U.S. App. D.C. 77, 1978 U.S. App. LEXIS 9843 (D.C. Cir. 1978).

Opinion

Opinion for the court filed by Circuit Judge TAMM.

TAMM, Circuit Judge:

Potomac Electric Power Co. (PEPCO) seeks review of an order 1 of the Interstate Commerce Commission (Commission) refusing to hold unreasonable certain rates published by Penn Central Transportation Co. (Penn Central) for unit-train shipments of coal, or the failure and refusal of Penn Central to provide and publish rates for unit-train service in carrier-furnished cars. 2 Although we agree with the Commission concerning the failure of Penn Central to provide and publish rates for unit-train service in carrier-furnished cars, we remand the case to the Commission for further proceedings concerning the reasonableness of the rates in question.

I

PEPCO receives shipments of coal transported by railroad from mines in Pennsylvania and West Virginia to three of its electric generating stations in Maryland— Chalk Point, Morgantown, and Dickerson. 3 For a number of years, Penn Central provided conventional “trainload” service to the Morgantown and Chalk Point stations, a service now provided by intervenor Consoli *1061 dated Rail Corp. (Conrail). 4 For a number of reasons, PEPCO began in approximately 1973-74 to increase dramatically its actual use of coal and its projections for the future. 5 Penn Central’s trainload service proved unreliable, most particularly with respect to railroad car supply. In response to this situation, PEPCO entered into discussions with Penn Central concerning the addition of so-called “unit-train” service to the Chalk Point and Morgantown stations. 6 Unit-train service is a system in which cars and locomotives are joined for an uninterrupted, round trip, shuttle-type service, and is regarded as an efficient method of transporting coal in large volumes. 7

Although PEPCO requested Penn Central to publish alternative rates based first, upon unit-train service utilizing PEPCO-furnished cars, and second, upon unit-train service utilizing carrier-furnished cars, 8 Penn Central agreed only to publish rates for and provide service in PEPCO-furnished cars. 9 Penn Central advised PEPCO that the unit-train rate for such service would be between 50 and 60 cents per ton below the trainload rate, after which PEPCO placed an order to buy cars. 10 Penn Central then specified an exact rate of 52 cents per ton below the corresponding trainload rates. 11 Although PEPCO was not satisfied with the announced rate, it advised Penn Central to proceed with publication of its tariff containing the rate in question. 12 This tariff became effective in November 1974.

PEPCO instituted this proceeding on December 23, 1974, by filing a complaint with the Interstate Commerce Commission. 13 In its complaint, PEPCO alleged, inter alia, that the published rates on unit-train shipments to its Chalk Point and Morgantown stations and certain published rates on trainload shipments to these two stations and to its Dickerson station were unreasonable. 14 PEPCO also challenged Penn Central’s refusal to provide and publish rates for unit-train service in carrier-furnished cars. 15 PEPCO sought reparations from Penn Central, the prescription of reasonable rates for trainload service, and the prescription of reasonable rates for unit-train service in both PEPCO-furnished and carrier-furnished cars. 16 After a hearing, the Commission’s administrative law judge (ALJ) denied all relief. 17

Upon the filing of exceptions to the initial decision of the ALJ by PEPCO, the Commission, Division 2, affirmed the initial *1062 decision, with the exception of the ALJ’s conclusion that the trainload rates to the Dickerson station were not shown to be unreasonable. 18 The Commission ruled that the trainload rates on shipments to the Dickerson station were unreasonable because the rate-to-variable cost ratio (expressed as a percentage) of 246.6 percent applicable to such shipments was excessive as compared to the rate-to-variable cost ratios of 179.4 and 178.0 percent applicable to trainload shipments to the Morgantown and Chalk Point stations, respectively. 19 The Commission ordered that the proceeding be reopened for the limited purpose of receiving evidence on the maximum reasonable level of trainload rates to the Dickerson station. 20 Commissioner (now Chairman) O’Neal concurred in the decision stating in a separate opinion that he would have found the unit-train rates to be unjust and unreasonable to the extent that they resulted in rate-to-variable cost ratios in excess of 200 percent. 21

PEPCO sought a declaration that an issue of general transportation importance was involved in order to obtain reconsideration by the entire Commission of the decision of Division 2. 22 The Commission denied PEP-CO’s petition for such a declaration by order dated May 6, 1977. 23 In this court, PEPCO challenges the Commission’s decision with respect to the unit-train rates and service.

II

We note at the outset that review of a decision of the Interstate Commerce Commission involving rates is limited in scope — such a decision should stand unless it is unsupported by evidence, or made without a hearing, or in excess of constitutional limits, or, for some other reason, constitutes an abuse of power. Manufacturers Railway v. United States, 246 U.S. 457, 481, 38 S.Ct. 383, 62 L.Ed. 831 (1918); accord, Atchison, Topeka & Santa Fe Railway v. Wichita Board of Trade, 412 U.S. 800, 806, 93 S.Ct. 2367, 37 L.Ed.2d 350 (1973) (principal opinion) (Marshall, J.). Moreover, we are aware that in assailing published rates as unreasonable and requesting the Commission to prescribe just and reasonable rates, the complainant bears the burden of proving the alleged unreasonableness. Swift & Co. v. United States, 343 U.S. 373

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Bluebook (online)
584 F.2d 1058, 190 U.S. App. D.C. 77, 1978 U.S. App. LEXIS 9843, Counsel Stack Legal Research, https://law.counselstack.com/opinion/potomac-electric-power-company-v-united-states-of-america-and-interstate-cadc-1978.