ICC v. ATLANTIC COAST LINE R. CO.
Legal provision: Interstate Commerce, as amended
Argument of Robert W. Ginnane
Chief Justice Earl Warren: Number 40 -- Number 14, Interstate Commerce Commission, Petitioner, versus Atlantic Coast Line Railroad Company et al.
Mr. Robert W. Ginnane: Mr. Chief Justice, may it please the Court.
This case began with an order of the Interstate Commerce Commission which did only one thing.
It ordered the respondent railroads, pay reparations of about $8900 to a shipper, Thomson Phosphate Company, based upon shipments of ground phosphate rock from Florida points at -- in Illinois.
This Court granted the Commission's petition for a writ of certiorari to review the decision of the Court of Appeals for the Fifth Circuit that the respondent railroads could bring suit, seeking review of the Commission's reparation order under the statutory provisions governing the review of Commission orders generally.
We contend that contrary to the court below that the railroads may not bring suit to challenge a Commission order awarding reparation, but that they may attack that order only by way of defense to the Commi -- to the shipper's suit seeking to enforce the reparation order under the provisions of Section 16, paragraph 2 of the Interstate Commerce Act.
We contend that only in this way can there be effectuated two congressional purposes.
First, to leave to the shippers rather than to the Government, the enforcement of reparation orders and secondly, to accord to the shippers' specific procedural rights as to venue cost and attorney's fees which will enable shippers to assume that work.
The railroad brought this suit in 1961 in the United States' District Court for the Middle District of Florida, naming United States and the Commission as defendants.
The shipper was not named as a defendant and has not intervened.
The railroads brought this suit in Florida in reliance upon three statutory provisions.
The first was Section 17, paragraph 9 of the Interstate Commerce Act which is set forth in our brief at page 3.
We submit that on its face, 17 (9) is simply a requirement for the exhaustion of administrative remedies.
The railroad contend that 17 (9) refers us to the Judicial Code, Section 1336, that's in our brief at page 2, which provides that except as otherwise provided by Act of Congress, the District Court shall have jurisdiction of any civil action to enforce, enjoin, set aside any order of the Interstate Commerce Commission.
The railroad further point to the venue provision 1398 of the Judicial Code, which provides that such an action shall be brought only in the judicial district wherein is the residence or office of plaintiff or one of the plaintiffs.
So the railroad contended in this case that under Section 1336, they could bring their own direct action in the District Court for review of the Commission's reparation order and that under the general venue provision of 1398, they could bring it in Jacksonville, Florida where the Atlantic Coast Line, a respondent here and a plaintiff below, has its principle place of business.
Now, we admit that 1336 and 1398 of the Judicial Code, provide for the judicial review of the general wrong of ICC orders.
However, we contend that they are -- those two sections are rendered inapplicable by the specific provisions of Section 16, paragraph 2 of the Interstate Commerce Act as to what shall happen when the Commission directs railroads to pay reparations to a shipper.
Before getting into the heart of the problem, I can refer briefly to the prior Court decisions on this point.
This Court has never given plenary consideration to the point.
In 1911, in Southern Railway Company v. United States, the former Commerce Court of United States held on a literal reading of its jurisdiction to review any order of the Commission that it could entertain such a suit by a railroad at attacking a reparation order.
That case has not been cited since 1911.
Later in 1924, a three-judge district court and in 1937 the Third Circuit, have held that a railroad may not maintain such a direct suit.
I might also say that a mere glance at the annotations to Section 16 (2) of the Annotation Code, shows that there are large number of cases in which the courts have look up reparation orders in the context of a suit brought by the shipper under 16 (2).
For 50 years, except for three -- of three cases in which I have mentioned before and this case, for 50 years, the courts have reviewed reparation orders in the context of a suit brought by the shipper.
Before going into the details of Section 16 (2), I think it may be useful to point out the Court the status of a reparation order issued by the Commission as compared to the other types of orders, many other types of orders which the Commission issues.
Since the Hepburn amendments of 1906, with the exception of orders for the payment of money, the Commission's orders are self-executing, self-operating, in that they must be obeyed subject to penalty unless a court sets them aside.
And it was -- in making orders – such orders other than for the payment of money, self-operative for the first time in 1906 that Congress for the first time provided for direct review of Commission orders.
In addition, if a railroad fails to obey any order of the Commission other than for the payment of money, the Commission or any party injured may go into court and seek affirmative enforcement.
In contrast, when the Commission orders a railroad to pay reparations to a shipper, that is an order for the payment of money, that order is not self-operative.
By that I mean, that if the railroad is unwilling to comply and pay, nothing happens.
It is not subject to any penalty.
Moreover, the Commission is not empowered to go into court to enforce a reparation order.
Rather Section 16 (2) has its own specific machinery.
It's set forth in pages 4 and 5 of our brief and it provides that the complainant, that is the shipper, may file in the District Court of United States for the District in which he resides, on which is located the railroad's office or through which the railroad operates or in any state court which has jurisdiction of the railroad, a complaint.
Justice Tom C. Clark: What's the [Inaudible]
Mr. Robert W. Ginnane: 016 (2) -- 16 (2) by ninety years–-
Justice Tom C. Clark: [Inaudible]
Mr. Robert W. Ginnane: 16 (2) in one form or another has been in the Act since 1887, in substantially its present form that has been there since 1906.
Justice Tom C. Clark: In 17 (9) is part of 1940?
Mr. Robert W. Ginnane: It is part of the Transportation Act of 1940.
Justice Tom C. Clark: What year?
Mr. Robert W. Ginnane: 1940.
Such a suit in the District Court Section 16 (2) says, "Shall proceed in all respects like other civil suits for damages,” except that the findings and order of the Commission, “shall be prima facie evidence of the facts therein stated” and except that the plaintiff shall not be liable for costs except those which accrue on his own appeal and the plaintiff if he finally prevails, shall be allowed a reasonable attorney's fee to be taxed and collected as part of a cost of suit.
Justice John M. Harlan: Mr. Ginnane, that means if the [Inaudible]
Mr. Robert W. Ginnane: As a practical matter search through the years, no.
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: No.
What happen -- what has happened in the judicial application of these provisions is that the review is just the same as in a direct review procedure.
Justice John M. Harlan: What is the statute that you suggest it?
Mr. Robert W. Ginnane: The statute was phrased this way because it was thought necessary to preserve the carriers' right to trial by jury, the money claim.
As a practical matter that they do not often ask of a trial by jury.
The result is in the Court of Appeals for the Second Circuit a few years ago held in a new a process Deere case that the standards are the same as an ordinary judicial review.
Are the Commission's findings supported by substantial evidence?
Are they in accordance with the statute and were they made after a fair procedure?
Justice John M. Harlan: The way you [Inaudible] that this was [Inaudible]
Mr. Robert W. Ginnane: This Court has not had occasion to.
This Court has made it very clear that under Section 16 (2) it finds that the carrier has a full opportunity to defend against the Commission's order on any ground that would be available on a direct review proceeding.
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: It could happen.
I don't know of such a case.
I put it this way.
The Court could do it, however, whether the shipper would have a right to a trial by trial in that situation.
Justice John M. Harlan: [Inaudible] the shipper owner said well actually [Inaudible]
Mr. Robert W. Ginnane: Let me go back sir, I think I misled you.
If the shipper is attacking the Commission's order as not giving him enough then he does not proceed under 16 (2) to enforce the order.
He would file – he would find action on the 1336, challenging the Commission's order.
The Commission erred as a matter of law or as a matter of clear evidentiary record in -- and not awarding him more.
There had been such suits filed in recent years.
Section 16 (6) -- Section 16 (2) is invoked by a shipper in a suit against the carrier not in a suit against -- against the Commission seeking to attack Commission's order.
We think Section 16 (2) has four salient features.
The First it provides that the Commission order awarding reparations shall be enforced by the shipper not by Commission.
It gives the shipper a choice of venue, including most importantly the District in which he resides.
It largely freezes the shipper from a liability for a costs and finally, it allows the shipper a reasonable attorney's fee if he prevails.
We believe this whole procedure, careful procedural pattern of 16 (2) were before him, if it's the court below held the carrier instead of waiting for the shipper's suit which must be brought within a year, instead of winning for the shipper's suit, it instituted its own direct review proceeding in a suit brought against the United States and the Commission.
In this case, railroad brought the suit down in Florida, naming United States and the Commission as defendants.
The shipper wasn't named, hasn't intervened so the burden of sustaining the reparation order was transferred as a practical matter from the shipper to the Government.
In the meantime, the shipper has filed his own suit under 16 (2) up in New York City.
That suit is being held in the abeyance on this litigation.
The respondent railroad contend that the provisions of 17 (9) of the Interstate Commerce Act and 1336 of the Code in authorizing actions to enjoin any order of Commission must be read as including all orders.
Now, we -- we point out that this Court in a series of cases, Los Angeles Railroad, Griffin has held to the contrary.
In Waterman for example, these cases were -- were summarized briefly by this Court as follows and I quote, “this Court long has held that statutes which employ broad terms, to confer power of judicial review are not always to be read literally.
Rather this Court has held that the meaning of a statutory provision for review of any order must be read and must be found in the context of a statute about.”
And so, we say that this Court is wholly free as a matter of statutory construction to hold that a railroad may attack a reparation order only by way of defense to a shipper's suit under 16 (2) in order to carry out the legislative policies underlying 16 (2).
Next the railroads contend that they should not be relegated to defense in a 16 (2) suit because they say 16 (2) is not a review provision and they seem to say that the District Court in a 16 (2) suit brought by the shipper would not have power to review the Commission's findings.
We think this Court has clearly held of the contrary.
In 1915 in Meeker case, this Court held that Section 16 (2), cuts off no defense, interposes no obstacle to a full contestation of all the issues.
And in 1949 in U.S. v. ICC this Court referred as guaranteeing railroads a complete judicial review of adverse reparation orders.
So we submit that there would no unfairness in relegating the railroads to the remedy of defending against the reparation order by way of defense to the shipper's 16 (2) suit.
Justice John M. Harlan: Now I suppose that Commission's order [Inaudible]
Mr. Robert W. Ginnane: Unsupported by evidence?
It should have after unfair procedure --
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: That -- they can attack it in any ground which they could raise in a direct review proceeding, legal evidentiary procedure.
Justice John M. Harlan: So they could in fact set aside the Commission's order procedure [Inaudible]
Mr. Robert W. Ginnane: There are number of such cases in the books through the years.
Justice Abe Fortas: Mr. Ginnane, as I understand that and I may be wrong about this.
What happens on the shipper suit is that the findings and order of the Commission are offered as prima facie evidence then the shipper further if he wanted to supplement that evidence, that is to say that Commission's findings and order and carrier can introduce evidence to show that despite their prim -- prima facie -- the findings in order are incorrect, is that right?
Mr. Robert W. Ginnane: I think what would happen that the defending carrier will -- would produce a record, evidentiary record made before the Commission and state that this record does -- just doesn't provide substantial evidentiary support for the Commission‘s findings.
Justice Abe Fortas: Ordinarily, the knowledge – it occurs to me as antitrust claim in a -- findings in order in any antitrust action brought by the Government.
And when that is used as prima facie evidence in a private suit then the procedure -- I believe is as I have described it, but you're telling me that as practical matters, it's different here?
Mr. Robert W. Ginnane: The case has suggests as a practical matter one or two things happens.
If the shipper comes into Court in Section 16 (2) suit with a certified copy of a Commission report and order and nothing more happens, he's got his prima facie case right.
Justice Abe Fortas: Yes.
Mr. Robert W. Ginnane: The carrier can do one or two things.
He can seek to introduce evidence de novo in the court so I think there would be a growing reluctance on the part of courts to permit that.
Most likely what he would do today, he would present the evidentiary record made before the Commission and state “This is -- this record does not provide evidentiary support of the Commission's findings.
Justice Abe Fortas: But as a matter of law is it -- is it your view that under this statute, the carrier could come in and introduce evidence in a usual way --
Mr. Robert W. Ginnane: That's the way the statute seems to read.
Justice Abe Fortas: And similarly, the shipper could come in and introduce supplementary evidence?
Mr. Robert W. Ginnane: Not to get more than the Commission had awarded it.
Justice Abe Fortas: No, but to -- to whatever purpose he choose to reinforced to strengthen the case made to reinforce or supplement the prima facie case.
Mr. Robert W. Ginnane: And I take at that evidence normally it would be in the form of a certified copy of the evidence which he had presented to the Commission.
Presumably, he has made his case there.
As a practical matter, both shipper and carrier will have made their case before the Commission.
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: For -- the purpose of my argument, I really don't have to say this certainly and --
Justice John M. Harlan: It's the petition of the appellant?
Mr. Robert W. Ginnane: All I have to say is in our committee it's entirely fair to relegate the carrier to it’s defense of a shipper’s suit under 16 (2).
All I have to show and I think I have is that the scope of review available to the carrier in a 16 (2) is at least as broad as it would be in a direct review proceeding.
And this Court I think is so held is at least that broad.
If -- if the carrier gets a broader review in his defense to the Section 16 (2) suit.
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: That of the conclusion --
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: Of course, the carrier could reply without --
Justice Hugo L. Black: I hope in the --
Mr. Robert W. Ginnane: How can I settle for a narrower scope of review, I'd take my chances with that.
But from -- to support my position, I need only demonstrate and I think I have that the scope of review available to the railroad as a defendant of 16 (2) suit is at least is broad.
At the review, he could get it in any other way.
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: That the concern which you just expressed sir seems to be the core I think of the decision below.
The Court of Appeals put it this way and it is pages 58 and 59 of the record.
The Court said, “This assures some symmetry and the construction and maintenance of a national transportation policy.”
The Attorney General the general counsel of the commission are directly and immediately responsible for the conduct of that litigation and the advocate of an assertion of contentions being essential in the public interest.
The court below added that by contrast in the shippers 16 (2) suit, absent intervention by United States of the Commission.
It said, “The sole spokesman in behalf of the Commission's order as the private party seeking partisan relief opposed by formidable experienced counsel for the Commission.
Now with all respect to the court below that's been no showing made that public interest have suffered by leaving the enforcement of -- of reparation orders to shippers under Section 16 (2).
We cannot recall, certainly not in my 10 years in the Commission, I can't recall a Section 16 (2) suit in which United States or the Commission has sought to intervene.
Surely, we would consider it, if one were called to out attention involving broad transportation issues.
But in practice that isn't what has happened.
Justice Abe Fortas: Mr. Ginnane, here you're presenting this as I understand your theory that 16 (2) provides an adequate method of review of the Commission order?
Mr. Robert W. Ginnane: Well, the review and also an inadequate enforcement machinery in which -- in which the burden of enforcement was left by the Congress to the shipper rather than place it up on the Government.
And these --
Justice Abe Fortas: We decide --
Mr. Robert W. Ginnane: -- And the Commission is not authorized to bring a suit under 16 (2).
Justice Abe Fortas: As I studied this, it seems I -- I perhaps was misled by my own study of this thing, but it occurred to me that the Commission, in one point of view maybe functioning here as nothing more than sort of a master to make a findings and conclusions that are not self-executing and then if that is so then you wouldn't -- might consider whether the absence of judicial review is legal.
If your concern is nothing more than finding of master in subsequent proceedings are -- in the hands of interested [Inaudible] and that was my understanding of this, but I take it that you would reject that in the absence --
Mr. Robert W. Ginnane: Well, the reparation order is not self-operative in the sense that if the railroad declines to pay and meets the order, it is not subject to any penalty, nothing happens unless the shipper and only the shipper is authorized to do so, unless the shipper brings a suit under Section 16 (2).
Justice Abe Fortas: Well, perhaps I can state my difficulty this way.
If you assume that the type of order that the Commission enters in a reparations case is an order which requires judicial review then I -- it made me that there's problem here which is of considerable difficulty.
Is that your assumption that as a matter of law a Commission's reparation order requires judicial review machinery?
Mr. Robert W. Ginnane: Before a carrier can be required to pay, yes.
He must -- he must have his day in Court.
Justice Abe Fortas: I didn't want to ask you but I get you.
That is -- it was not my question.
I said a review of that order as distinguished from a -- an independent proceeding in which the Commission's findings and orders are merely part of the mass of evidentiary material.
That is -- you can have a court arriving at a result in theory at any rate that is opposite or contrary to the result that the Commission arrived at, but the court's contrary decision being based upon evidence before it, which is not before the Commission, is that correct or not?
Mr. Robert W. Ginnane: Theoretically there could be such a case, yes sir.
But I would also submit that there is no constitutional requirement that direct judicial review be made available as long as the order is not self-enforcing.
Congress could provide for such direct review.
I would concede that the order is final in the sense that the administrative action is complete.
There's nothing more for the Commission to do but we don't -- but our position in brief is that Congress has not provided for direct review of such orders.
It has provided that the carrier can have this day in Court, at least, as broad as he would have a direct review proceeding by way of defense to the shipper's suit.
We would say in that accomplishes two purposes.
It leaves the burden of enforcement of reparation orders which Congress apparently thought did not involve typically broad transportation issues to shippers.
At least the shipper in a position in Section 13 (2) proceeding to get the procedural benefits of venue, freedom from costs, and right to an attorney's fee if he wins which co -- which are the tools which Congress gave him as we see it, to carry the burden of enforcement of such orders.
Justice Byron R. White: Well, Mr. Ginnane, why -- you would rather stay out of what you call review proceedings of your decisions which underlie reparation order, you prefer to stay out of those of the 16 (2) suits I take it.
Mr. Robert W. Ginnane: That's right.
Justice Byron R. White: And then this time left the Court pass on your -- on the Commission's judgments which might involved matters of some import, only a fact that how much the dollars and cents of reparation --
Mr. Robert W. Ginnane: I had --
Justice Byron R. White: -- the courts pass on that without being there at all?
Mr. Robert W. Ginnane: Sir, it's been going out for about 50 years.
Justice Byron R. White: Well, I didn't -- again, that --
Mr. Robert W. Ginnane: And we would --
Justice Byron R. White: -- the answer is yes --
Mr. Robert W. Ginnane: We answered yes.
Justice Byron R. White: You'd rather stay out of it.
Mr. Robert W. Ginnane: We'd rather stay out.
Of course, in the particular case involving broad issues and general importance, I think we would -- any Court would allows us to intervene.
Justice Byron R. White: Have you ever?
Mr. Robert W. Ginnane: In my 10 years with the Commission, we have not sought to intervene in such a case nor has one been called to our attention of which we seriously consider it.
Justice Byron R. White: Although, the shipper -- the shipper can -- that the carrier has not way of getting you in the Court to -- for purposes of judicial review one of the reparation orders according to your view.
Mr. Robert W. Ginnane: That's correct, sir.
Justice Byron R. White: And if the -- he cannot finally have any carrier under 16 (2) proceeding sets your order aside, the railroad -- the railroad cannot have your order set aside.
All -- all the Court can do is say that the shipper or this railroad doesn't need pay this particular shipper.
Mr. Robert W. Ginnane: That maybe so technically and that seem to trouble the court below a little bit that all the court could do would say, “Well, you don't have to pay this particular shipper but here these other shippers over here which under the Phillips case can bring other suits because they're similarly situated.
Our only answer to that is so far as we know it has not been a practical problem.
We -- we are not aware of those rep – repetitive suits situations.
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: It maybe amazing sir --
Justice John M. Harlan: [Inaudible]
Mr. Robert W. Ginnane: Surprisingly, we do not know of situations for that it's been nothing.
Chief Justice Earl Warren: Well then Mr. McDonald.
Argument of J. Edgar Mcdonald
Mr. J. Edgar Mcdonald: Mr. Chief Justice, members of this Honorable Court.
I think if I may I would like to state at the very outset that my answers to most of the questions addressed to Mr. Ginnane with the possible exception of those posed by Mr. Chief Justice -- Mr. Justice White would have been exactly the reverse to the answers he gave this Court.
For example, before I attempt to deal with my prepared argument, it's my understanding that the law is entirely clear in response to the first question that Mr. Justice Harlan asked that the Court could not change the amount of damages which the Commission had found a particular complainant to -- entitled to in a Section 1 case, a Section which alleged that the charges under attack were unjust and unreasonable in violation to that section.
As a matter of fact, this Court itself and I don't have immediate reference to it but it's the brief, this Court itself has said in the case of that kind and incidentally, the case that precipitated this particular proceeding before this Court is what -- is the Section 1 case.
This Court has said that the amount damages, is in effect fixed.
It's the difference between the rate originally charged which is a sale before the Commission as unreasonable and the Commiss -- and the rate which the Commission decides would have been a reasonable rate and so on.
In other words, if the sale rate for 50 cents, and the Commission says, a reasonable rate would have been 40 cents, the damages are fixed.
There 10 cents per 100 pounds times the weight of the shipment and there's nothing for the court to do with that.
Now in Section 3 case, where the allegations before the Commission turn on a finding of undue preference and undue prejudice and there which is extremely rare incidentally, there the Commission decides that the complainant is entitled to damages.
The amount of damages there determines as I read the cases can be looked at by the -- by the court because there the damages go beyond the measure of the rates charged for transportation.
There the Court is entitled to look, to see whether or not the plaintiff has been made whole for his total damages which is not the case in a Section 1 proceeding.
Justice Abe Fortas: Does it appear in the statute Mr. McDonald?
Mr. J. Edgar Mcdonald: Sir?
Justice Abe Fortas: Does that distinction appeared with the statute in any way or what's the basis of that?
Mr. J. Edgar Mcdonald: I'm sorry Mr. Justice Fortas, I can't give you a direct answer now except to say that I don't think it appears in the statute, but it appears in some of the earlier cases of this Court that I can't give you reference to right here and now which dealt with the amount of damages awarded by the Commission in Section 3 cases.
I hesitate to even guess, it seems to me so called Chicago Junction case.
Justice Abe Fortas: You are saying that there are decisions of this Court that support the propositions that you just stated?
Mr. J. Edgar Mcdonald: Yes, sir.
Justice Abe Fortas: And not cited in your brief?
Mr. J. Edgar Mcdonald: I'm not sure that I've cited in the brief, the cases which support the Section 3 -- authority of the Court to change the amount of damages in a Section Free case.
I don't think we've done that.
If the Court wants, I'll be glad to do it in --
Justice Abe Fortas: It's nothing in the Section 16 (2) that would indicate that difference there, is there?
Mr. J. Edgar Mcdonald: No, sir, not at all.
Mr. Ginnane makes much of the choice of venue here.
What he was very careful to avoid was to point out that the place of business of the shipper involved was in Illinois, it was in Illinois Corporation but his choice of venue was in New York City.
I don't take any particular quarrel with the choice of venue.
I think -- but I think I ought to say one thing more about it.
That shipper suit was filed just six days before the expiration of the statute of limitations and I'm speculating somewhat but I gather that it was done largely at the instance or suggestions of the Commission itself.
If Mr. Ginnane, Mr. Goodman says, that's not so, I wouldn't quarrel or challenge their word in that respect.
Now, Mr. Justice Harlan spoke about an order in the Section 16 (2) and asked if the order could be set aside and the -- the reply briefs of Mr. Ginnane, on the bottom of page 5 in the top 6, admits that the order couldn't be set aside.
And you cannot incidentally again in response to one of Mr. Justice Harlan's questions, you can not introduce evidence as you could in the trial de novo in a so-called Section 16 (2) suit.
And I can say incidentally that I learned that the hard way because I was involved in a new process Deer case that Mr. Ginnane referred to which was referred in the Southern District of New York before an extremely sympathetic judge and the facts in that particular case, but who finally decided that in the right of an opinion by his own Circuit Court of Appeals, he had no choice but to refuse receipt of any additional evidence.
Justice Byron R. White: Was it tried this on the record then?
Mr. J. Edgar Mcdonald: Yes, sir.
Just on the record before the Commission and as I understand it, that's the only thing that you entitled to have.
Justice Byron R. White: That's the Second Circuit case, how about it?
Mr. J. Edgar Mcdonald: That's the new process Deere case.
Justice Byron R. White: Yes.
But how about -- how about have it presently that's -- that they accept the rule that's the understanding?
Mr. J. Edgar Mcdonald: That's my understanding of it, yes sir.
Justice Byron R. White: And I gather that this was a -- this ruling was it the response of the -- this represents the Commission review clearly.
Mr. J. Edgar Mcdonald: Yes, sir.
That's my understanding of it and the --
Justice Mr. Justice Brennan : Commission [Inaudible]
Mr. J. Edgar Mcdonald: Sir?
Justice Mr. Justice Brennan : Was the Commission in that case?
Mr. J. Edgar Mcdonald: No, sir.
They weren't in the case.
No, I didn't understand Mr. Justice White was asking me that.
It's actually --
Justice Mr. Justice Brennan : Now tell me.
Under 17 (9) would you -- would it be different?
Which you have decided on the record -- I mean, that proceeding would be a proceeding under record below?
Mr. J. Edgar Mcdonald: Exactly, without the introduction of any -- of any evidence.
I say that in any review proceeding, we are confined entirely to the record before the Commission and the only thing to would be decided is whether or not the Commission's determination and its resulting order, are in all things valid as a matter of laws as I think Mr. Chief -- Justice Harlan put it.
Justice Mr. Justice Brennan : Well, that's I don't understand Mr. McDonald.
What -- what I understood you to say was that in that Deere case, a 16 (2) proceeding --
Mr. J. Edgar Mcdonald: Yes, sir.
Justice Mr. Justice Brennan : – you are limited to review on the record made before the Commission.
Mr. J. Edgar Mcdonald: We were denied that -- we were denied any attempt to put in evidence.
Justice Mr. Justice Brennan : Yeah.
Well, what you say that the determination was made on record before the Commission?
Mr. J. Edgar Mcdonald: That's right.
Justice Mr. Justice Brennan : Well that is how I think you are worse than you'd be in the 17 (9) proceeding?
Mr. J. Edgar Mcdonald: Well, I think I can answer that in a hurry maybe I shouldn't stop to my prepared argument instead of being so anxious to answer Mr. Ginnane, indicate that my answer would have been different.
In a so called 17 (9) case and the -- or so called 1336 case, the only thing that's involved is the validity of the Commission's -- the record before the Commission, the validity as a matter of law.
The Commission's determination in any resulting order and in it, you would allege in accordance with the various decisions of this Court, the Commission exceeded its constitutional authority that it was invalid or rather that it -- in violation of the Constitution that exceeded its statutory authority or that in some other way it was in -- arbitrary.
Now, in the particular proceeding here, the Commission refused to recognize the statute of limitation as the courts below found.
If that's not arbitrary, I don't know what it is?
And that was the basis on which we went to court to have the Commission's order to set aside.
Now in the 17 -- in a 17 (9) or 1336 action, the effect of it is contrary to a Section 16 (2) order that the administrative findings of the Commission and its order are set aside.
And then Tom Jones or Frank Smith or anybody else in any other part of the country, allegedly similarly situated is in no position to go into any Court, State or Federal or back to the Commission and in effect to say, I want the same treatment as my brother guy.
It just can't be done because the order is nullified and set aside and that's the crucial thing here.
Justice Mr. Justice Brennan : Well, what -- what happen -- I gather, your position is in the 16 (2) of all the things you have told us could be asserted in 17 (9) or 1336 proceedings, would also be asserted by way of defense in 16 (2).
If you prevail under 16 (2) proceeding, the shipper does not get an order against the railroad to pay the reparation, but the order of the Commission itself remains to the books.
Mr. J. Edgar Mcdonald: That is right.
Justice Mr. Justice Brennan : Now, what -- well, now what -- what value is an order treated that way of a 16 (2) proceeding, even though it's still on the books, what value is it to any other shipper?
Mr. J. Edgar Mcdonald: Well, any other shipper can go into a State Court or another Federal District Court and on the presentation of the same record another Court can decide that it does agree, just as in one of the decisions this morning four the esteemed gentleman on this bench disagreed with their five brothers in a disposition of a particular case.
In a case brought in Maine for example, the District Court there may find -- yes the complainant --
Justice Mr. Justice Brennan : Or the finding of the Court --
Mr. J. Edgar Mcdonald: -- in the Court's course entitled.
Justice Mr. Justice Brennan : -- has the facts in any experience.
It was 16 (2) proceedings where reparations were not ordered at the conclusion of the proceeding where nevertheless the ICC order has been relied on in another instance.
Is there any experience to that?
Mr. J. Edgar Mcdonald: I can't give you a direct answer Mr. Justice Brennan to that.
I can't think of any at the moment, but I do say more important to that.
The principles -- the principles and the precedents that are involved in the administrative findings can and I'm sure have been relied on.
I have no doubt about that.
Now, my time is fast running.
I've said and we have said in substance in our brief and I'm sure I don't have to repeat it here that Section 16 (2) is not a review section as Mr. Ginnane has indicated with.
And this Court has said in the substances as has others that it's an action sounding in tort for damages and that it's a civil action that can be brought only by the party claiming damage or injury.
Its nowhere the accident and I'm sure it isn't for the reason of Mr. Ginnane said that the Commission wasn't empower to enforce the reparation order.
It is because it involved the taking of money which -- in which they had no direct interest.
Anybody entitled to damages from a railroad who is charge to unlawful rate would be the plaintiff in the case and they have referred or left rather to the -- to their right to seek seek damages they would as this Court has said in any of the civil action for damages.
Now, 1336 the section of the judicial review statute that gives the carriers the right -- gives anybody a right to seek, to enjoin set aside then no an Commission order is a so-called direct review section.
And I'm afraid my time will go before I have a chance to say after the line if that so.
So let me say that -- I put this way, if I may.
In two decisions at least by this Court, United States against ICC and Pennsylvania against United States, the opinions in which were both written by Mr. Justice Black, it seems to me that there's no question whatever that this Court has in all and every -- in practical results taken the position already that suits to it maybe brought to enjoin any order for the requirement of the Commission and not as they say any order except one requiring the payment of money.
Now, the late Mr. Justice Frankfurter in the first case, United States against the ICC reported at 337 U.S. in a -- in a dissent that if I recall correctly was longer rather than the opinion.
Trying to read into the statute, into the Section 16 (2) the very language that Mr. Ginnane contends for all practical purposes is there.
That the -- that the -- I guess it's the other way around, excuse me, that 1336, trying to read into that language.
Any order or requirement other than one for the payment of money, but the Court obviously didn't listen to it then and I know of no reason why I should listen to him now.
Justice Byron R. White: Well, I guess if you are going to 17 -- under 17 (9) railroad -- again, instead of being put off the 16 (2), you wouldn't have choice -- the railroad will have a choice of venue that would enjoin 16 (2) and it wouldn't have to pay any attorney's fees.
Mr. J. Edgar Mcdonald: There's no question -- well, I'm not so sure that that's true because as the court pointed below Mr. Justice White, any complainant before the Commission can as a matter of right to intervene in a suit that is brought by a carrier against the United States and the Interstate Commission.
And incidentally as I mention in that brief, right now we have an action similar to this pending in the District Court in Baltimore.
If my memory serves me correctly, it's been there over two years now, waiting the disposition of this jurisdictional issue, involving some 16 or 18 complainants -- plaintiffs before the -- complainants before the Commission.
In a few instances, two have intervened in the proceeding and filed a counter claim, seeking damages and an award of attorney's fees and costs and I don't think there's anything wrong with that.
I think that's entirely proper but the important thing about the disposition that we're trying to make indicates of that time where the plaintiff as if they become, excuse me, where the complainants before the Commission were all the way from California to Maine.
I'm sure that the figures are minimum of 16 and I recall a republic steel company in Cleveland.
I recall somebody else in San Francisco, California.
Now apart from those 16 or 18, the entitlement to bring suits that are in any time in the course of the first year to enforce the order there, other people unrelated to the action who had similar transportation services performed with them on the strength for the reparation of the administrative findings and order which we are there seeking review of, could go into any State Court or any Federal District Court and ask for damages on the strength to those findings.
Now, the action that we're attempting to take is to clear the air promptly.
If we don't do that we got to sit by and wait for the expiration of 12 months to see if any body is going to sue us if we don't comply.
Perhaps even more important in that ethically is no other way, this statute, the Interstate Commerce Act makes it a duty of carriers to comply with any order of the Commission as long it is on the book so to speak.
And while as my friend says there's no “penalty” as there is, if you fail to comply with an order, “telling you to publish a rate for the future to take effect one month from today when you can be subject to a $5,000 fine, there are penalties here as the law or the Court find it out and the -- as this Court has said itself in the Baldwin case which is likewise been shown in -- decided in my brief.
The purpose of 16 (2), according to this Court was not to place the burden of enforcement as Mr. Ginnane puts it on the complainant for the reasons I have indicated.
The Commission itself couldn't do it.
In any other respect or any other case, they have the right under Section 16 (12) to go into court and so do other people as well to compel enforcement.
In the case of a suit for money, that's left to the private parties, but the -- I forgot what I'm trying to say.
In any event the point of it here is, we would be, I started to say about the Baldwin case.
In the Baldwin case, this -- this Court said in the substance that the reason for 16 (2) was to preclude reluctant railroad.
I don't know if they use the term reluctant or not, but they certainly used terms like coercive.
They wanted to keep railroads from offering, harassing resistance to comply with these orders when they didn't have a defense.
Now, we are not here because we didn't think we had a defense to these things.
We think quite -- quite to the contrary and that's the reason we probably would has a good offense and undertook the pursue it and I'm not at all impressed by Mr. Ginnane's continued repetition about it here and in the brief but this is the first time in 50 years that somebody has thought of seeking judicial review directly.
Maybe there were another case as I'm -- I'd be the first to say that in the -- I would think in the large of jar of instances where that railroads defend reparation cases before the Commission and lose they comply with them.
They pay Comm -- they pay the amount specified in the Commission's order with interest.
It's only an extreme cases whereas in this one in the Baltimore one that I've talked about where they're satisfied and would believe in their minds that they have a good reason to challenge the validity of the of the Commission's administrative findings and order as a matter of law that they do what they did here.
And again, that doesn't deprive any shipper of a choice of venue or attorney's fees or anything else if he chooses to protect themselves, but he doesn't even have to do it.
But the lower court commented on that too and pointed out that as practical matters, if we have a direct review proceeding and lose, the complainant before the Commission is almost home free so to speak.
There's no defense left then in the Section 16 (2) and contrary to the position taken by the Government, I can't imagine any single instance in which railroads, who lost the direct review proceeding brought under Section 17 (9) or 1336, not to mention the Administrative Procedure Act, incidentally, would even bother trying further to contest the validity of that action or require any complainant -- any complainant to become a plaintiff in a Section 16 (2) suit to get the reparation that then I don't think any defense to which it is simple as that to me.
Now, the -- another thing that I think this Court should know is that in the cases that I referred to already which the opinions are written by Mr. Justice Black, the United States took a position directly opposite that which the United States and the Commission combined are attempting to turn it here.
In those cases, they in effect said and I pointed this out in my brief as I recall correctly at page 19 and begin around 33.
In those cases, the United States took the position in substance that this language of the statute was clear and that there was no doubt at all that any order meant any order and that any party could attack him in a Section 1336 suit.
Now in its brief, the -- and particularly in its reply brief as I recall correctly or if it is not there incidentally, it is in the Government's brief in the case following this immediately, the Consolo case which was not consultative for oral argument by this Court but in the in its -- in its brief -- I'm sorry, I've lost my thought and I'm trying to find a place it here.
Oh, in its brief, they -- now, I have lost my thought.
Finally -- finally, the Court -- I'm sorry the Government in its – argument here says in substance that the fact that there's slight difference that they talk about in a Section 16 (2) suit.
He can get the administrative findings and order set aside and the other when you can is from that standpoint doesn't mean anything that we have no cause to compliant.
Oh, I say with that's all -- that's all the cause in the world we need to complain.
What they may think is minor in some instances maybe major from our standpoint – One thing more; Mr. Ginnane referred to a case that was before the courts in the 1913, if I recall correctly the so called Southern Railway case and mentioned the fact that nothing came of that because of the complaint was withdrawn and it couldn't be appealed.
I think the Court should know that the decision in that case, it wasn't written by was at least joined in by Judge Knapp who had been challenging the Interstate Commerce Commission for some 12 or 14 years, prior to his appointment to the bench and as such he appeared as a witness before Congress on a number of occasions when revisions of the Act where under consideration.
He certainly, if anybody was, was thoroughly familiar with the meaning of the phrase “Any order or requirement” at the time the decision in the Southern Case was laid down.
And that -- that one important in that it was referred to in a St Louis versus Ophalen case by this Court which again is referred to in our brief.
I wouldn't for a moment consider -- I'm sorry I find my time is in --
Chief Justice Earl Warren: No.
No, you have five minutes from the time that red-white light comes off.
Mr. J. Edgar Mcdonald: Thank you.
Chief Justice Earl Warren: Red light will come after that.
Mr. J. Edgar Mcdonald: Thank you.
I wouldn't attempt the burden the Court with comments on the legislative history there of this -- of the Hepburn Act which is referred to both in brief and Mr. Ginnane's argument.
But the -- there's no question but what -- there was extensive discussion in the Congress as to the meaning of the language that we're here particularly concern with any order or requirement.
I have here represent pages of 40 congressional record beginning at 6685 and running through 6787.
I just like to say that in the discussion on the floor the -- the knowledge of these words and the import was so well understood that Senator Bacon asked not once but several times if there was any language in any words in the dictionary that could be more specific in substance and at one spot and this is short, so I suppose I must point to this extent at 40 congressional records 6773 when they were discussing an amendment which eventually became part of the Hepburn Act, Senator Bacon said, “Here is an amendment offered by the Senator from Iowa which is absolutely without limitation which is as broad as human language can make it, giving to the Court the right to review every order or requirement made by the Commission.”
Now, the thing that I haven't understood from the beginning of this proceeding --
Chief Justice Earl Warren: Who made that statement Mr. McDonald?
Who did you say made that statement?
Mr. J. Edgar Mcdonald: Senator Bacon.
Chief Justice Earl Warren: Yes, go on.
Mr. J. Edgar Mcdonald: With reference to this particular pros -- that the Hepburn amendment when I was under consideration on the floor of Congress and the Section that was then being discussed was Section 5 where this particular language occurs where the jurisdiction and venue is conferred with respect to and I quote again, “Any order or requirement” of the Commission.
Chief Justice Earl Warren: Is he one managers of the Bill?
Mr. J. Edgar Mcdonald: Sir?
Chief Justice Earl Warren: Was he one of the managers of the Bill, Bacon?
Mr. J. Edgar Mcdonald: I can't answer that.
Mr. Boyer who will be one of those arguing in the next case I'm sure can.
I started to say that finally that the one thing that I don't understand is the thought of the Commission that when an order -- when administrative findings and orders by the Commission in a reparation case are attacked by the losing party that the Commission shouldn't be called upon to defend that.
They admit, they found out the hard way in 337 U.S. that if they deny reparation it's proper to seek review -- to find out whether denial was proper as matter of law.
They found out in 363 that the losing party in a referral case, one that reached the Commission from me to the Court of Claims for example, the State Court or anything like that the losing party can seek review before the courts under Section 1336, but in the case of a railroad who loses before the Commission in a case, they say you can't have direct review there.
It must wait on the eventually of possibility that you will be sued in court within the one year and if nobody sues you, the -- as the court below said, you are left with unsatisfactory law for all to use them satisfactory presents.
I trust that this Court will be as impressed by the decision of the lower court, Circuit Court of Appeals as I was and will find accordingly.
Chief Justice Earl Warren: Very well.