San Antonio v. Burlington Northern, Inc.

650 F.2d 49, 1981 U.S. App. LEXIS 12141
CourtCourt of Appeals for the Fifth Circuit
DecidedJune 19, 1981
DocketNos. 81-1150, 81-4141
StatusPublished
Cited by2 cases

This text of 650 F.2d 49 (San Antonio v. Burlington Northern, Inc.) is published on Counsel Stack Legal Research, covering Court of Appeals for the Fifth Circuit primary law. Counsel Stack provides free access to over 12 million legal documents including statutes, case law, regulations, and constitutions.

Bluebook
San Antonio v. Burlington Northern, Inc., 650 F.2d 49, 1981 U.S. App. LEXIS 12141 (5th Cir. 1981).

Opinion

POLITZ, Circuit Judge:

This appeal presents the question whether the District Court for the Western District of Texas, San Antonio Division, had jurisdiction to order a preliminary injunction,1 enjoining appellant-railroads from putting into effect a tariff rate published with the Interstate Commerce Commission. We hold that it did not. In conjunction with this holding, we deny petitioner’s motion to stay the Commission’s order reported at San Antonio, Texas v. Burlington Northern, Inc., I.C.C. Dkt. No. 36180 (April 7, 1981), which vacated an earlier rate determination by the Commission in San Antonio, Texas v. Burlington Northern, Inc., 355 I.C.C. 405 (1976) (San Antonio I).

We previously considered various motions, granting the railroads’ motions to stay the preliminary injunction pending appeal and to expedite the appeal, denying the railroads’ motion to vacate the preliminary injunction instanter, and ordering carried with the case San Antonio’s motion to stay the April 7, 1981 order of the Commission vacating its decision in San Antonio I. In extended oral argument and in exhaustive briefs, the parties fully addressed all aspects of the merits of this appeal. Appellate jurisdiction is based on 28 U.S.C. § 1292(a)(1).

[51]*51BACKGROUND

This appeal constitutes but one of several litigational chapters in the orogenic dispute between San Antonio, Texas on one side, and Burlington Northern, Inc., and its subsidiaries, and Southern Pacific Transportation Company (the railroads) on the other. At the crux of the controversy is the determination by the Interstate Commerce Commission of a maximum reasonable rate for unit-train shipments of coal from Campbell County, Wyoming to Elmendorf, Texas, a suburb of San Antonio and location of San Antonio’s electric generating station.

During the early 1970s market conditions compelled San Antonio, acting through its City Public Service Board (CPSB), to change its primary electric utility fuel from natural gas to coal. In July 1973, during the course of negotiations, the railroads quoted the CPSB a proposed rate of $7.90 per ton for rail service from Wyoming to Texas, subject to annual adjustments for cost changes. On May 2, 1974, the quotation was revised to $11.09. Shortly thereafter, the CPSB entered into twenty-year contracts with two companies for the supply of coal from Wyoming, and committed itself to build two generating plants at Elmendorf.

Dissatisfied with the proposed $11.09 rate, on May 6, 1975, the CPSB filed a complaint with the Commission alleging the rate was unlawful under § 1(5) of the Interstate Commerce Act and requesting the Commission to prescribe a maximum just and reasonable rate. Because of the pressing need to eliminate delay in the transportation of the coal, the Commission moved expeditiously to resolve the dispute, found the railroads’ rate unjust and unreasonable and prescribed a maximum , reasonable rate of $10.93 per ton. San Antonio I, supra. Realizing that its order was an interim measure, however, the Commission stated that “as actual experience is gained,” the parties might petition for modification of the prescribed rate. This decision and order was appealed to the Eighth Circuit, which affirmed the Commission’s action. Burlington Northern, Inc. v. United States, 555 F.2d 637 (8th Cir. 1977).

In 1978 the Commission was asked to reopen its San Antonio I proceeding. After the taking of additional evidence, the Commission allowed the railroads to establish a rate not exceeding $16.12 per ton. San Antonio, Texas v. Burlington Northern, Inc., 359 I.C.C. 1 (1978) (San Antonio II). The CPSB and the railroads both filed administrative appeals; the Commission reopened proceedings and found that a rate of $17.23 constituted a maximum reasonable rate. San Antonio, Texas v. Burlington Northern, Inc., 361 I.C.C. 482 (1979) (San Antonio III).

Petitions for review were filed in the Court of Appeals for the District of Columbia Circuit with the railroads contending the rate ceilings imposed in San Antonio II and San Antonio III were arbitrarily low, and the CPSB contending the rate ceilings were too high. In a decision rendered June 9, 1980, the D.C. Circuit held that the bases for the challenged rate ceilings were not supported by reasoned analysis and therefore violated the requirements of the Administrative Procedure Act. The court vacated the San Antonio II and III orders and remanded to the Commission for further proceedings. San Antonio, Texas v. United States, 631 F.2d 831 (D.C.Cir.1980).

Citing the D.C. Circuit’s vacation of San Antonio II and III, the CPSB, since approximately August 11,1980, has refused to pay any amount over the $15.83 adjusted rate ceiling allowed by San Antonio I. The railroads, on the other hand, have continued,to charge the rate set forth in the tariff filed with the Commission ($21.95 per ton as of August 11,1980), which rate was within the permissive ceiling approved in San Antonio III. Thus the present impasse. In an effort to collect the higher rate, the railroads filed a tariff supplement (which was to become effective November 16,1980) conditioning rail service on prepayment. On November 14,1980, the Commission suspended the railroads’ prepay tariff supplement, stating that because the D.C. Circuit had set aside the Commission’s decisions in San Antonio II and III, the Commission was [52]*52then of the opinion that the only rate the railroads could charge was the adjusted rate as prescribed in San Antonio I. I & S Dkt. No. 9253, Prepayment of Rates — San Antonio Coal Movements.

Confronted with the Commission’s interpretation that the D.C. Circuit’s decision reinstated the San Antonio I rate prescription, the railroads filed a Petition for Clarification of Mandate with the D.C. Circuit urging the court to make clear that its decision did not suspend the effectiveness of the $23.05 published tariff rate or require a “rate roll-back” to the San Antonio I level pending proceedings on remand before the Commission. That inquiry remains pending before the D.C. Circuit.

On November 26,1980, the railroads filed with the Commission a tariff supplement setting forth a proposed rate of $23.05 per ton for transporting coal in unit-train service from Wyoming to Elmendorf. This rate was the maximum rate level approved by the Commission in San Antonio III as escalated by subsequent general rate increases. Notwithstanding protest by the CPSB, the Commission on December 30, 1980, unanimously voted not to suspend or reject the proposed tariff. The six Commissioners were equally divided on the question whether to investigate the lawfulness of the rate under 49 U.S.C. § 10707. This rate became effective December 31, 1980. The CPSB did not challenge the $23.05 rate before the Commission, as it was entitled to do under the Interstate Commerce Act, 49 U.S.C. § 11701.

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