Regular Common Carrier Conference v. United States

820 F.2d 1323, 261 U.S. App. D.C. 144
CourtCourt of Appeals for the D.C. Circuit
DecidedJune 23, 1987
DocketNos. 85-1601, 86-1222 and 86-1435
StatusPublished
Cited by7 cases

This text of 820 F.2d 1323 (Regular Common Carrier Conference v. United States) 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
Regular Common Carrier Conference v. United States, 820 F.2d 1323, 261 U.S. App. D.C. 144 (D.C. Cir. 1987).

Opinion

HARRY T. EDWARDS, Circuit Judge:

We are asked to review three decisions of the Interstate Commerce Commission (“ICC” or the “Commission”) exempting from statutory prior approval requirements a series of intermodal acquisitions involving rail and motor carriers. Because we conclude that the Commission applied the wrong statutory criteria in granting the exemption requests, we reverse and remand the Commission’s decisions.

I. Background

These consolidated cases involve the acquisition of several trucking companies by Burlington Northern, Inc., a holding company that owns the Burlington Northern Railroad Company, a Class I railroad. In four separate petitions filed with the ICC during 1985 and 1986, both Burlington Northern, Inc. and its wholly-owned subsidiary Burlington Northern Motor Carriers, Inc. (hereinafter referred to collectively as “Burlington Northern”) sought statutory exemptions in connection with their proposed acquisitions of six trucking companies. Absent exemptions, the acquisitions would have required prior ICC approval under 49 U.S.C. § 11343 et seq. (1982 & Supp. Ill 1985). In seeking to avoid the requirement of prior approval from the ICC, Burlington Northern petitioned for exemptions under 49 U.S.C. § 11343(e) (1982), which provides in relevant part:

(e)(1) Notwithstanding any provisions of this title, the Interstate Commerce Commission, in a matter related to a motor carrier of property providing transportation subject to the jurisdiction of the Commission under subchapter II of chapter 105 of this title, may exempt a person, class of persons, transaction, or class of transactions from the merger, consolidation, and acquisition of control provisions of this subchapter if the Commission finds that—
(A) the application of such provisions is not necessary to carry out the transportation policy of section 10101 of this title; and
(B) either (i) the transaction is of limited scope, or (ii) the application of such provisions is not needed to protect shippers from the abuse of market power.

Id. § 11343(e)(1). Section 10101, referenced in section 11343(e)(1), lists the overall goals of ICC transportation policy. Id. § 10101.

Burlington Northern’s petitions for section 11343(e) exemptions were opposed by the Regular Common Carrier Conference (“RCCC”), the Transportation Lawyers Association (“TLA”), the International Brotherhood of Teamsters, Chauffeurs, Ware-housemen and Helpers of America (“IBT”) and the American Trucking Association, Inc. Among their objections, the opposing parties claimed that the ICC may not act under section 11343(e) to exempt rail-motor acquisitions of the sort proposed by Burlington Northern, but must instead evaluate such acquisitions according to the requirements set forth in 49 U.S.C. § 10505 (1982):

(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 [146]*146not needed to protect shippers from the abuse of market power.
(g) The Commission may not exercise its authority under this section (1) to authorize intermodal ownership that is otherwise prohibited by this title, or (2) to relieve a carrier of its obligation to protect the interests of employees as required by this subtitle.

Id. § 10505(a), (g). Section 10101a, referenced in section 10505(a)(1), lists the specific goals of ICC rail transportation policy. Id. § 10101a.

In proceedings before the Commission, the opposing parties contended that the reference to “intermodal ownership” in section 10505(g)(1) included ownership of motor carriers by railroads, and thus included Burlington Northern’s proposed acquisitions. Such ownership, they argued, is “otherwise prohibited” within the meaning of section 10505(g)(1) unless it satisfies the specific requirements of 49 U.S.C. § 11344(c) (1982), which states in relevant part:

When a rail carrier, or a person controlled by or affiliated with a rail carrier, is an applicant and the transaction involves a motor carrier, the Commission may approve and authorize the transaction only if it finds that the transaction is consistent with the public interest, will enable the rail carrier to use motor carrier transportation to public advantage in its operations, and will not unreasonably restrain competition.

In other words, the opposing parties argued that, because section 10505(g)(1) prohibits the ICC from exempting a rail-motor acquisition that does not satisfy the requirements of section 11344(c), the ICC was statutorily obligated to apply the standards of section 11344(c) (and not the less stringent standards of section 11343(e)) in considering Burlington Northern’s petitions.

In a series of three decisions, the ICC purported to invoke the provisions of section 11343(e) and granted all four of Burlington Northern’s exemption petitions. In so doing, the ICC rejected the opposing parties' arguments regarding the overriding applicability of section 11344(c). See Burlington Northern, Inc. — Control Exemption — Victory Freightway Sys., ICC Docket No. MC-F-16248 (decided July 11, 1985; served July 26, 1985) (“July 1985 Decision”), reprinted in Joint Record Appendix (“J.R.A.”) 1; Burlington Northern, Inc. — Control Exemption — Victory Freightway Sys., ICC Docket No. MC-F-16248, Burlington Northern, Inc. — Control Exemption — Monkem Co., ICC Docket No. MC-F-16372, and Burlington Northern, Inc. — Control Excemption— Monroe Trucking, ICC Docket No. MC-F-16452 (decided Jan. 29, 1986; served Feb. 13, 1986) (“January 1986 Decision”), reprinted in J.R.A. 9; Burlington Northern, Inc. and Burlington Northern Motor Carriers, Inc. — Control Exemption— Stoops Express, Inc., Wingate Trucking Co., and Taylor-Maid Transp., ICC Docket No. MC-F-17030 (decided July 18, 1986; served July 28, 1986) (“July 1986 Decision”), reprinted in J.R.A. 22.

In the July 1985 Decision, the ICC rejected by a 4-3 vote the argument that the “intermodal ownership” limitation of section 10505(g)(1) compelled the Commission to apply section 11344(c) to the transactions at issue. The majority added that even if section 10505(g)(1) — and thus section 11344(c) — were applicable, Burlington Northern’s proposed acquisition would satisfy the requirements of section 11344(c). However, the majority offered only a cursory explanation of the basis for this alternative holding. July 1985 Decision at 5,

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820 F.2d 1323, 261 U.S. App. D.C. 144, Counsel Stack Legal Research, https://law.counselstack.com/opinion/regular-common-carrier-conference-v-united-states-cadc-1987.