UNITED STATES v. GREYHOUND CORPORATIONCiv. A. No. 69-C-1148, Crim. No. 71-Cr-924.
363 F.Supp. 525 (1973)
UNITED STATES of America, and Interstate Commerce Commission, Petitioners,
The GREYHOUND CORPORATION et al., Respondents.
UNITED STATES of America, and Interstate Commerce Commission, Petitioners,
The GREYHOUND CORPORATION, and Greyhound Lines, Inc., Respondents.
The GREYHOUND CORPORATION et al., Respondents.
UNITED STATES of America, and Interstate Commerce Commission, Petitioners,
The GREYHOUND CORPORATION, and Greyhound Lines, Inc., Respondents.
United States District Court, N. D. Illinois, E. D.
June 27, 1973.
As Amended July 18, 1973.
John E. Sarbaugh, Joel Davidow, U. S. Dept. of Justice, Chicago, Ill., Lubomyr M. Jachnycky, I. C. C., Bernard A. Gould, Director, Bureau of Enforcement, I. C. C., Bernard M. Hollander, Chief, Judgments & Judgment Enforcement Section, Antitrust Div., U. S. Dept. of Justice, Robert S. Turkington, Chief, Court Enforcement Branch, I. C. C., Washington, D. C., for petitioners.
George Christensen and Edmund J. Kenny, Winston & Strawn, Chicago, Ill., William W. Schwarzer and John R. Reese, McCutchen, Doyle, Brown & Enersen, San Francisco, Cal., Robert J. Bernard and W. L. McCracken, Phoenix, Ariz., for respondents.
MEMORANDUM OPINION AND ORDER
ROBSON, Chief Judge.
The United States and the Interstate Commerce Commission (ICC) filed two petitions seeking orders to show cause why the Respondents should not be held in contempt for failing to comply with an order of a three-judge panel of this court, entered February 5, 1970, reported at
In accordance with a Pre-Trial Order of March 8, 1972, the two petitions were consolidated for all purposes and there was no evidentiary hearing. The trial record of this case included:
a) The record of the prior proceedings in this case both before the Interstate Commerce Commission and before this Court;
b) The pleadings, interrogatories and supporting affidavits and exhibits on file herein and in Mt. Hood Stages, Inc. v. The Greyhound Corporation, No. 68,374, in the United States District Court, District of Oregon;
c) The testimony taken and exhibits identified in the depositions in this case and in Mt. Hood Stages, Inc. v. The Greyhound Corporation, supra;
d) The documents produced by either party in this proceeding and in Mt. Hood Stages, Inc. v. The Greyhound Corporation, supra, as well as correspondence between Mt. Hood Stages, Inc. and Greyhound relating to the subject matter of this action.
Because of the large number of individuals who are mentioned in the opinion and to whom reference was made, the court shall identify these persons here and finds:
The court, having studied the testimony and exhibits submitted in this cause, and having examined the written briefs of counsel, and being fully advised of the premises, further finds as follows:
The jurisdiction of the court is not disputed.
The Greyhound Corporation is a corporation organized and existing under the laws of the State of Delaware with its principal place of business in Phoenix, Arizona.
Greyhound Lines, Inc., is a corporation organized and existing under the laws of the State of California with its principal place of business in Phoenix, Arizona. It is a wholly owned subsidiary of The Greyhound Corporation. Greyhound Lines, Inc., was a plaintiff in civil action 69-C-1148 and was subject to the order of this court entered February 5, 1970.
The geographic setting for these contempt proceedings is Oregon, Idaho, Washington, and California. The several small cities mentioned regularly in the opinion are: Klamath Falls, The Dalles, Biggs, and Bend, Oregon; Redding, California; Pasco and Yakima, Washington.
The respondents Shaffer, Kerrigan, and Nageotte are actively engaged in the management, direction and control of Greyhound's affairs and are responsible for Greyhound's compliance with the order of this court entered in civil action 69-C-1148 on February 5, 1970.
Since the order was entered in this case, Greyhound has engaged in a course of conduct which evidences a willful failure to comply with several of its paragraphs. Gradually, the pressure of this contempt litigation forced Greyhound to bring its conduct into conformity with many aspects of the order. This conclusion is supported by examining Greyhound's eleventh hour remedial action.
The evidence presented in this case compels the court to conclude that Greyhound willfully violated Paragraphs 1, 3, 4, 5, and 6 of this court's order and that such willful violations were established beyond a reasonable doubt. The court further finds that there was no criminal contempt as to Paragraphs 2, 8, and 9.
As to Paragraphs 1, 3, 4, 5, and 6 the Court finds that Greyhound had notice of the order and that it willfully failed to embark on a program of compliance that would meet the requirements of the order. With respect to some paragraphs, Greyhound failed to take any steps toward compliance. With respect to others, Greyhound interpreted the order in such a way as to render it meaningless. Yet the law is clear that a party who makes his own determination as to the meaning of a decree, acts at his peril. If Greyhound had doubts as to its obligations under the order, it could have petitioned this court for a clarification or construction of that order. McComb v. Jacksonville Paper Co.,
To illustrate and support the court's conclusion, it is necessary to review the conduct of the respondents in light of the plain language of the order.
II. CRIMINAL CONTEMPT CHARGES
VIOLATIONS OF PARAGRAPH 1
Paragraph 1 required Greyhound to show Mt. Hood's schedules on an equal basis with other non-Greyhound lines.
The evidence shows beyond a reasonable doubt that Greyhound did not treat Mt. Hood on an equal basis with other non-Greyhound lines. For example, in January, 1970, Greyhound table 603A failed to show Mt. Hood's connecting service between Portland, Bend, and Salt Lake City. In July, 1970, five months after the court's order, Greyhound added Mt. Hood's connecting service between Boise and Salt Lake City, but still omitted Mt. Hood's service originating in Portland destined for Madras, Bend, and Salt Lake City. The fastest route between Portland and Bend, Oregon is via Mt. Hood. Since Greyhound does not serve Bend, this route via Mt. Hood is a connecting schedule with Greyhound at Portland. Greyhound shows schedules of other carriers which connect Greyhound service with points that Greyhound does not serve. For example, in table 585 Citizen Auto Stage Company's service between Tucson, Arizona (which Greyhound serves) and Nogales, Arizona (which Greyhound does not serve) is shown. In this table, Greyhound shows all of Citizen's service between these points. Thus, Greyhound's omission of Mt. Hood's service between Portland and Bend was discriminatory against Mt. Hood as opposed to its treatment of other non-Greyhound carriers. It is significant that in October, 1971, four months after the contempt petitions were filed Greyhound, in an effort to expiate its sins, saw fit to include Mt. Hood's service from Portland to Bend in table 603A.
Greyhound argues that it was not obligated to show this particular route because it was directly competitive with an all Greyhound route, and that the government has not shown that the failure to show this particular route constituted unequal treatment of Mt. Hood. These arguments are not convincing. Greyhound was under an ICC order since December, 1968, to show the route in question.
If Greyhound was of the opinion that it was not required to show directly competitive service it should have asked this court for an interpretation or modification of the order. As the Supreme Court stated in McComb v. Jacksonville Paper Co.,
So in the present case, Greyhound could have sought guidance from this court if it was of the opinion that directly competitive service need not be shown.
Finally, Greyhound was under a court order to show Mt. Hood's services on an equal basis with other non-Greyhound lines. While it may be true that Greyhound cannot, or physically could not, show all connecting service from each city it serves, Greyhound should have
Additional evidence of unequal treatment is found in table 603. The basic problem with this table was that it showed many off-route points, thus failing to indicate that the Greyhound-Mt. Hood through-bus service via Klamath Falls was direct between Klamath Falls and The Dalles. The table also failed to show the departure time from The Dalles and the interchange point of Smithsville for the connecting Mt. Hood-Greyhound service to Yakima and Ellensburg.
Furthermore, table 603 shows schedules 821 and 822, the through-bus. The presence of these schedules in table 603 made it appear as if these Mt. Hood schedules (jointly with Greyhound) were being run through Portland, when actually the runs were direct between The Dalles and Klamath Falls. Greyhound also continued to show in table 603, labeled "San Francisco-Spokane", the all Greyhound service via Portland.
That Mt. Hood was not being treated by Greyhound on an equal basis is evident from Greyhound's showing of other lines on analogous tables. For example, table 117, in a comparable situation, Greyhound shows the through and connecting service with Bonanza Bus Lines, Inc., without including intermediate off-line points which would make the table unclear.
In October, 1971, twenty months after this court's order and four months after the contempt petitions were filed, Greyhound corrected table 603 so as to eliminate the confusion generated by the showing of off-route points. This correction also brought the presentation of Mt. Hood's schedules by Greyhound more into conformity with Greyhound's treatment of other non-Greyhound lines.
Further evidence of unequal treatment is found in Greyhound table 31C, which presented some of Mt. Hood's routes in a distorted and confusing manner. Prior to the court order, Greyhound's through-bus service between San Francisco and Spokane via Portland was shown. Five months after the court order this table was revised to show Greyhound-Mt. Hood through-bus service between San Francisco and Spokane via Klamath Falls. However, the table also showed several off route points creating the impression that the service went through these points when in fact it did not. The July, 1970, version of this table failed to show Greyhound-Mt. Hood connecting service.
In July, 1971, Greyhound began to show the connecting times for several of the off-route points. But Greyhound still failed to show the Greyhound-Mt. Hood connecting service.
In October, 1971, Greyhound eliminated some of the off-route points. The connecting service to Sacramento and Los Angeles was shown in a clear and satisfactory manner. In addition, Greyhound revised the table to include Greyhound-Mt. Hood connecting service. However, this was shown incompletely as Greyhound's service from Spokane to The Dalles was omitted. Consequently, passengers and agents would not be aware that one could transfer to a Mt. Hood bus at The Dalles. It was not until January, 1972, that Greyhound's connecting schedule from Spokane to The Dalles was added.
That Greyhound was not treating Mt. Hood on an equal basis becomes clear when table 31C is compared with Greyhound table 31B, which immediately precedes table 31C. Greyhound's table 31B shows schedules between Seattle, Portland, Reno, Las Vegas and Phoeniz. This table not only shows the throughbus
Greyhound stated that upon filing of the contempt petitions it revised several schedules, including table 31C so as to remove the alleged distortions and omissions. However, as indicated above, table 31C did not completely and accurately show Mt. Hood's service until six-months after the contempt petitions were filed.
The government also charged that Greyhound's omission of table 31C from Greyhound Lines-West Timetable and Greyhound time folders was an act of discrimination against Mt. Hood. That Greyhound did not treat Mt. Hood on an equal basis with other non-Greyhound carriers is readily apparent from examples such as Greyhound's inclusion of table 12A in its Systems Timetable. Table 12A shows through service between Dallas, (Texas) Albuquerque, and California via Orange Belt Stages, Texas, New Mexico, and Oklahoma Coaches, and New Mexico Transportation Co. Table 31C, showing service from California to Washington is an analogous table and under the order should have been included in the Systems Timetable along with table 12A.
Greyhound contends that table 31C is one of a special group of tables which are designed to show through service, not connecting service, between major points. However, the court is of the opinion that if Greyhound did not think it should be required to show Mt. Hood's connecting service on table 31C it should have sought a modification, clarification, or construction of the order. See McComb v. Jacksonville Paper Co., supra.
In light of the foregoing, the court must conclude that Greyhound willfully failed to treat Mt. Hood on an equal basis with other non-Greyhound carriers in that tables 603, 603A, and 31C failed to depict Mt. Hood's service at least as well as Greyhound depicted the service of other non-Greyhound lines.
The element of willfulness required to support a finding of criminal contempt is established by the fact that Greyhound unreasonably delayed in complying with the mandate of Paragraph 1.
VIOLATIONS OF PARAGRAPH 2
Paragraph 2 required Greyhound: (1) to restore the through-bus service which Greyhound operated until September 8, 1964, in connection with Mt. Hood via Klamath Falls and The Dalles, Oregon; and (2) discontinue the bus service Greyhound has operated in substitution therefor since then via Portland, Oregon.
The government charged in the criminal contempt petition that Greyhound willfully disobeyed Paragraph 2 in that Greyhound did not discontinue its practice of routing passengers over its route via Portland, in substitution of the Greyhound-Mt. Hood joint through-route. The court, having carefully considered the petition, response, and the briefs, is of the opinion that the government has failed to prove beyond a reasonable doubt that Greyhound violated Paragraph 2. The government's own admissions that Greyhound has fulfilled both requirements of Paragraph 2 eliminates any basis for a finding of either civil or criminal contempt.
It appears from the government's petition and brief that the gist of the complaint against Greyhound is that it has failed to take affirmative measure to stop the practice of routing passengers over its Portland route, thus diverting traffic from the Greyhound-Mt. Hood joint through-bus.
The final government charge relating to alleged violations of Paragraph 2 is based upon the fact that Greyhound altered schedule 1622, the San Francisco-Seattle express. The government contends that this change was made in order to divert passengers from the joint through-bus, thereby injuring Mt. Hood. However, the government also admitted that Greyhound may have had proper reasons for making the schedule change:
Thus, the government itself has indicated that the reasons for the change in schedule 1622 may or may not have been to divert traffic from the joint through-bus. The fact that this schedule change may have diverted some passengers from the joint through-bus is not conclusive that Greyhound violated Paragraph 2, for that paragraph did not require that a certain percentage of traffic travel by way of the through-bus. The order merely required that Greyhound restore the San Francisco-Spokane joint through-bus via Mt. Hood's route between Klamath Falls and The Dalles (Biggs) and to discontinue its own substitute service via Portland.
The court, having found that Greyhound has done that which was required of it, hereby finds Greyhound not guilty of either civil or criminal contempt for alleged violations of Paragraph 2.
VIOLATIONS OF PARAGRAPH 3
Paragraph 3 ordered Greyhound to revise its interline schedules in connection with Mt. Hood so as to eliminate the presently existing delay of approximately three hours for passengers seeking to travel between California and Spokane via Mt. Hood's route. Paragraph 3 also required Greyhound to negotiate in good faith with Mt. Hood on the establishment of bus schedules most advantageous to the traveling public.
On the evidence presented, the court is of the opinion that Greyhound willfully violated Paragraph 3 in that it did not eliminate the three hour delay until eighteen (18) months after the entry of the order, and did not negotiate in good faith.
A. The Three Hour Delay
The contempt petition charged that Greyhound failed to revise its interline schedules in connection with Mt. Hood so as to eliminate a three-hour delay for passengers seeking to travel between California and Spokane via Mt. Hood's route. Greyhound's schedule 2933 from Spokane arrived at The Dalles more than three hours before the departure of Mt. Hood schedule 16 which travels south and connects at Klamath Falls with a Greyhound schedule traveling to California.
Greyhound took the position that Paragraph 3 of the order overlapped with Paragraph 2, and that by complying with Paragraph 2 (restoring the joint through-bus), compliance with Paragraph 3 was achieved. See Respondent's Brief 65, 68-69. The court cannot agree with this interpretation, for if the requirements of Paragraph 3 were incorporated in Paragraph 2, then there would have been no purpose in having Paragraph 3. The very language of the order demonstrates that there is a difference between the "through-bus service" referred to in Paragraph 2, and the "interline service" in Paragraph 3. Interline service involves an exchange of passengers from a Greyhound bus to one of Mt. Hood's, whereas through-bus service involves utilization of the same equipment (bus) over one or more routes. A Greyhound officer even acknowledged
The court further finds that the condition that Paragraph 3 was designed to remedy, i. e., the elimination of the three-hour delay, was exclusively within Greyhound's control. It alone had the power and ability to effect the schedule changes required by Paragraph 3. Yet the record shows that Greyhound failed to make those changes until November 10, 1971, eighteen months after the entry of the order and three months after the amended contempt petitions were filed. Notwithstanding the respondent's protests, it appears clear that the impetus for making the changes in November, 1971 was the filing of the contempt petitions. The court further finds that there was no plausible excuse for Greyhound's failure to comply promptly with the mandate of Paragraph 3. Its delay in complying with this paragraph constituted willful disobedience of the order. Accordingly, the court finds Greyhound in criminal contempt for failing to eliminate the three hour delay in a timely and expeditious manner.
B. Violations Regarding Greyhound's Failure to Negotiate in Good Faith.
Paragraph 3 of the order required Greyhound to ". . . negotiate in good faith with Mt. Hood on the establishment of bus schedules most advantageous to the traveling public . . . ." The Amended Contempt Petition charged that Greyhound failed to negotiate in good faith to provide convenient connections between its service from Coos Bay, to Eugene, Oregon and Mt. Hood's service from Eugene to Bend, Oregon and also for service in the opposite direction. The government also charged that Greyhound failed to provide good connections between its services from Twin Falls to Pocatello, Idaho, via Burley, Idaho and Mt. Hood's service from Portland, Oregon, to Salt Lake City, Utah and for service in the opposite direction.
Greyhound denied that it refused to negotiate in good faith with Mt. Hood on the establishment of bus schedules most advantageous to the traveling public. It further stated that it has revised its schedule from Coos Bay, Oregon and points south to make a 30 minute connection at Eugene with Mt. Hood's run 6E eastbound. This revision, claims Greyhound, eliminates the basis for the charge that Greyhound refused to negotiate in good faith about the connection at Eugene. However, the context in which the changes were made is more important, for criminal contempt purposes, than the fact that changes were eventually made. The manner in which the negotiations were conducted must be examined to determine whether Greyhound negotiated in good faith.
In an effort to secure compliance with the requirement of Paragraph 3, Mt. Hood's officials met and corresponded several times with Greyhound's officials.
As for negotiation pertaining to the Burley, Idaho connections, the government asserts that Greyhound did nothing to solve this problem until more than four months after the amended contempt petitions were filed. However, the government also admitted that the solution to the Burley problem was more difficult to arrange. The change of the Burley connection would require schedule changes by Mt. Hood, which Mt. Hood conceded would be difficult to change because its schedules were tied to the system schedules of Continental Trailways. Under these circumstances, it is difficult to state with absolute certainty that Greyhound refused to negotiate in good faith about the Burley connection. Nevertheless, the order merely required Greyhound to negotiate with Mt. Hood, not necessarily agree. It is true that Mt. Hood never made a specific proposal with regard to the Burley problem, but having had its proposals for the Eugene problem repeatedly ignored, it would appear to have been a useless act for Mt. Hood to have drawn up a detailed proposal with regard to the Burley connection. Furthermore, although Greyhound was aware of the Burley problem, it took no action to solve this problem until four months aft-the contempt petitions were filed. In light of these facts, the court must conclude that Greyhound willfully failed to negotiate in good faith with Mt. Hood. The record is silent as to any attempt by Greyhound to reach an accord with Mt. Hood on their mutual problems.
The duty to negotiate in good faith means at least that the parties have an obligation to participate actively in deliberations so as to indicate a present intention to find a basis for agreement. N.L.R.B. v. Montgomery Ward & Co.,
Greyhound's principal defense to the charges relating to Paragraph 3 is that the government based its complaint on the fact that Greyhound failed to reach an agreement with Mt. Hood on the various changes, not on a failure to negotiate in good faith. Greyhound states that it is settled that the duty to negotiate in good faith does not include a duty to agree. See N.L.R.B. v. Taormina,
Greyhound's contentions are without merit. First, the Warrington and Niskanen affidavits make it clear that the matter of improved bus connections at the various points was discussed on more than one occasion. During the meeting of March 24, 1970, Warrington made specific proposals to bring about compliance with Paragraph 3. At the same time he offered to alter Mt. Hood's schedules to facilitate compliance with Paragraph 3. Furthermore, once Warrington
The court therefore finds beyond a reasonable doubt that Greyhound willfully failed to comply with the good faith negotiation provision of Paragraph 3, and finds Greyhound in criminal contempt.
VIOLATIONS OF PARAGRAPHS 4 and 5
Paragraph 4 of the order required Greyhound to voluntarily and accurately quote joint through routes in connection with Mt. Hood, without geographical limitations, in a manner fully responsive to inquiries from the traveling public. Paragraph 5 required Greyhound to cease and desist from quoting Mt. Hood's service unfavorably or inaccurately in response to inquiries from the traveling public and from not quoting Mt. Hood's service at all in response to specific requests from the traveling public.
The criminal contempt petition charges that the respondents and their agents knowingly and willfully disobeyed Paragraphs 4 and 5 in that Greyhound and its agents (1) were not voluntarily and accurately quoting joint through routes in connection with Mt. Hood and (2) were not quoting Mt. Hood's services at all in response to requests from the traveling public as to the shortest, fastest, and least expensive and/or most convenient service available.
Specifically, the government charged Greyhound as follows:
(1) In June and July, 1970, the ICC conducted a survey to determine the extent to which Greyhound was quoting Mt. Hood's service in accordance with the order. The survey revealed that out of 80 inquiries, 47 of the responses, or 58%, received were incorrect, in that they did not voluntarily and accurately quote Mt. Hood's service when that service was the shortest, fastest, least expensive and/or most convenient.
(2) In July, 1971, the ICC conducted an additional survey to measure Greyhound's compliance. This survey revealed that 58 of the responses, or 51%, received were incorrect in that the agent did not voluntarily and accurately quote Mt. Hood's service when the service was the shortest, fastest, least expensive and/or most convenient.
(3) From February 5, 1970, to August, 1971, Mt. Hood conducted its own survey to determine the extent to which Greyhound was complying with the order. Mr. Donohue, Mt. Hood's traffic manager, conducted this survey at Greyhound terminals in the western United States. This survey showed that out of 316 telephone inquiries, 239 of the responses or 75%, received were incorrect,
(4) On May 26, 1970, Donohue gave Greyhound a report of 84 incorrect responses he had received from 39 different terminals subsequent to February 5, 1970. Later results of Mt. Hood's survey showed 118 additional incorrect responses were received at 24 of the same terminals about which Mt. Hood had previously complained to Greyhound.
(5) Finally, it was charged that Greyhound violated Paragraphs 4 and 5 of the order by issuing directives to its agents which were grossly inadequate to assure that they would be able to quote Mt. Hood's service in the manner contemplated by the order.
It was contended that Greyhound, by the acts of its agents, by refusing to take affirmative measures to cause its agents to comply with the order, and by taking action which was grossly inadequate to achieve full and accurate quotation of Mt. Hood's service, was willful disobedience of a lawful order of this court.
After carefully reviewing the evidence in support of these charges the court has come to the conclusion that Greyhound willfully violated Paragraphs 4 and 5. The evidence establishes beyond a reasonable doubt that Greyhound did not voluntarily and accurately quote joint through routes in connection with Mt. Hood and that Greyhound did not cease quoting Mt. Hood's service unfavorably or inaccurately in response to inquiries from the traveling public.
The principle evidence of violations of these provisions of the order is found in Exhibits B and E, attached to the affidavit of Bernard Gould, and in the Mt. Hood surveys, summarized in PX 20 (Donohue Exhibit A).
The government stated that an agent's response was marked incorrect if the interline service with Mt. Hood would have been shorter, faster, cheaper, and/or more convenient than the best all-Greyhound routing.
While a court order will not be expanded by implication or intendment beyond the meaning of its terms in order to find the respondents in contempt, Terminal R.R. Ass'n. of St. Louis v. United States,
As for Greyhound's criticism that the government is using a "scattergun approach of devising a series of different interpretations, each broader and looser than the next, . . ." the court cannot agree. While the form of the language used by the government in describing its measuring standard may vary slightly where it is mentioned in the briefs and petitions, the substance of the language remains the same. The court cannot discern any appreciable difference between the standard used in the criminal petition, or the one used in the civil contempt petition, or the standard used in Gould's affidavit. The court is of the opinion that the substance of the government's standard never varied. The government's overriding concern was:
(1) to see whether Mt. Hood's joint through routes were voluntarily and accurately
(2) to see that Greyhound ceased quoting Mt. Hood's service unfavorably or inaccurately, and from not quoting Mt. Hood's service at all in response to specific requests from the traveling public. The ICC and Mt. Hood surveys were the means used to check Greyhound's compliance effort. It was inevitable that during the course of that work certain value judgments would be made with regard to what was and was not a satisfactory quotation of Mt. Hood's service. The standard used by the government is a rational one in that it could be applied consistently and objectively to determine if Mt. Hood's service was being quoted in the manner contemplated by the order. The person making the inquiry for service could readily determine if the service quoted was the "shortest, fastest, least expensive, and/or most convenient service available". In short, the court is of the opinion that the standard used by the government was compatible with the terms of the order. Having made this determination, the court nevertheless feels compelled to discuss one other aspect of this problem.
Although Greyhound was extremely critical of the standard used by the ICC in measuring the correctness of a quote, Greyhound itself found it difficult to formulate a workable standard for measuring compliance. Greyhound's answer and depositions suggest that it advocates "totality of the circumstances" standard. Mr. Nageotte stated:
Greyhound stated in its response that so long as it
If the court were to recognize this "totality of the circumstances" test as an appropriate standard for measuring the correctness of a quote, it would render the order practically unenforceable. As the government pointed out:
Having decided this critical threshold question, the court may now consider the substantive evidence of violations
On August 11, 1970, Gould ordered that a limited ticket survey be conducted at the general office of Greyhound's Western Division in San Francisco, to determine whether Greyhound was continuing to route passengers to points in eastern and central Washington circuitously via Portland. The results of this study are shown in Gould's Affidavit Exhibit C and they indicate that the majority of passengers destined to or leaving the eastern or central part of Washington for points in California were still being routed via Portland on the longer and slower all-Greyhound route rather than by the faster joint route with Mt. Hood.
The study that Gould ordered in August, 1970 involved the examination of all tickets issued at Greyhound's Fresno terminal in March, April and May, the three months immediately after the issuance of this court's order. The survey specifically showed that 46
The relation between the ICC 1970 traffic survey, see Gould Affidavit, Exhibit B, and the passenger destination studies obtained from Greyhound is critical. The latter corroborates the findings that quoting violations occurred at major Greyhound terminals and that such practices caused large numbers of passengers to be routed via Portland rather than being sent the more direct interline routes with Mt. Hood.
Considering that these events took place in the few months immediately following the order, one could be charitable to Greyhound and excuse the apparent failure to quote according to Paragraphs 4 and 5, and the consequent long-routing of passengers on the basis that it would take some time for Greyhound to alter the past quoting habits of its agents. Also, the joint through-bus was not reinstated until April, 1970, which means that part of the ICC survey was conducted at a time when the all-Greyhound route was the only available service and therefore, the best. However, Mt. Hood continued to monitor Greyhound's quoting practices in the months that followed and in October, 1970 Mt. Hood sent abstracts of its survey to the ICC which indicated that Greyhound agents were still not complying with the injunction. Gould also testified that at least three times during early 1971 the ICC Bureau of Enforcement received copies of evidence of non-compliance by Greyhound submitted by employees of Mt. Hood to the Department of Justice.
While one would not expect Greyhound's quoting to be 100% accurate, the fact that there continued to be inaccurate and incorrect quoting, as judged by the standards heretofore discussed, on nearly 51% of the inquiries is sufficient to support a finding of criminal contempt. This conclusion is based upon the fact that Greyhound's quoting violations continued at about the 51% level in the year between the ICC's initial inquiry (in March, April, and May, 1970) and the last survey in July, 1971. By this time Greyhound certainly could have been expected to have reduced the quoting errors to a negligible level, but the results of the 1971 ICC survey suggests that Greyhound did little toward that end.
If further corroboration of the ICC study of 1971 is needed, it can be found in a Greyhound passenger destination study obtained as part of the discovery in the contempt cases. See BC-32. The Greyhound study covered a six month period from March to August, 1971. The results of this survey reveal that of 124 passengers traveling from Fresno to points in central or eastern Washington during the six-month period, 113 were routed the long way through Portland, Oregon, rather than by the joint route with Mt. Hood through Klamath Falls. Eleven passengers were routed via Mt. Hood. When this data is combined with the fact that on 27 separate instances, the agency at Fresno responded to ICC or Mt. Hood inquiries by failing to quote shorter or faster Mt. Hood service to Yakima, Washington and other points north east of Portland, it becomes clear that Greyhound's quoting violations at Fresno have a major effect on the actual routing of traffic.
A similar high correlation between quoting violations by Greyhound and routing of passengers via Portland was noted at Greyhound's Los Angeles terminal. Mr. Everett Croes, Greyhound's regional manager at Los Angeles for the area including southern California, testified that he was aware that the through-bus is more than two-and-one-half hours shorter than any all-Greyhound service from Los Angeles to Spokane. He further testified that the 1:00 p. m. departure time is a good departure time for what is a fairly long journey, especially in light of the arrival time at Spokane. Croes concluded by stating that if all the alternatives of the through-bus, the joint-through bus, and the all-Greyhound schedules were quoted fairly in Los Angeles, a substantial percentage of passengers from Los Angeles to Spokane would travel on the through route.
However, a Greyhound passenger study for the six month period March through August, 1971 revealed that of 295 passengers from Los Angeles to points in central and eastern Washington, 254—or nearly 90%—were routed via the longer, slower, all-Greyhound route through Portland, and only 31 were routed via the Greyhound-Pacific Trailways through-route, BC-32.
The disturbing fact is that, although this and other passenger studies conducted by Greyhound revealed a large amount of long-routing of passengers, and thus suggested that adequate quotation of service was not occurring, it does not appear that Greyhound ever used its
ICC and Mt. Hood investigators also discovered over 100 instances in which Greyhound agents failed to quote Mt. Hood's service adequately over east-west routes from points in western Oregon to eastern points, where the Mt. Hood service would have provided the most direct, fastest, and/or cheapest service. When Mt. Hood examined Greyhound tickets to and from the relevant points for the period of May through August, 1971, it was discovered that 918 passengers, over 55% of those traveling between points where Mt. Hood provides the most direct service, were routed the long way on all-Greyhound routes through Portland, Oregon.
Greyhound contends that the government's numbers, and its facile conclusions, will not withstand scrutiny. Greyhound asserted that the Exhibits B and E reflect the judgment of an ICC attorney as to whether in each particular case the agent quoted the "Best Service". It was argued that the standard of "Best Service" is far too vague and uncertain to constitute a basis for a finding of contempt. This argument however, ignores the fact that Mr. Gould interpreted the standard, thus giving it objective content. Gould stated that response was marked incorrect when an agent failed to
or when an agent gave
Furthermore, a careful examination of the numerous documents (PX 3001-3080 and PX 3501-3618) that formed the basis for Exhibits B and E reveals that "Best Service" is a shorthand expression for that service which in any given instance would be "the shorter, faster, cheaper, and or most convenient service available." This standard was used in the Criminal and Civil Contempt Petitions and the court already has found that the use of this standard was reasonable.
As for Exhibit B of the Gould Affidavit (1970 Inquiries), Greyhound states that out of 42 inquiries relevant to the joint through route, 17 (40%) of the responses are conceded by the government to be correct. Greyhound then analyzed 16 additional quotes to show that they were not totally incorrect quotes of joint through service; Greyhound did concede that 9 (21%) of the responses were clearly wrong.
As for Exhibit E of the Gould Affidavit (1971 Inquiries), Greyhound notes that out of a total of 67 inquiries relevant to the joint through route, 37 (55) of the responses are conceded by the government to be correct. Greyhound briefly describes why 15 of the inquiries, marked incorrect by the government, were at least questionable, and finally concludes that only 15 (22%) quotes were wrong in that they failed to quote Mt. Hood's service. This, Greyhound concludes, is not evidence of contempt.
However, Greyhound's analysis of Exhibits B and E ignored other evidence of violations. Greyhound chose to discuss alleged violations pertaining only to the joint through-route (Spokane to San Francisco) and did not give any consideration
Greyhound interpreted Paragraph 4 as requiring only the quotation of the joint through route and not the quotation of Greyhound-Mt. Hood interline service. This would mean that Greyhound would only have to quote the joint through service from Spokane to San Francisco via Mt. Hood's route from Klamath Falls and The Dalles. Greyhound relied on Thompson v. United States, supra, in which the Court established the test for a through route, to support its position that the joint through fare interline routes with Mt. Hood are not joint through routes within the meaning of Paragraph 4.
Having considered at some length the arguments presented, the court is of the opinion that Greyhound's position is untenable. Under Thompson, "the test of the existence of a `through route' is whether participating carriers hold themselves out as offering through transportation service," supra, note 38.
Thus, Greyhound's statement that:
is patently wrong. The joint honoring arrangements that Greyhound maintained with Mt. Hood and the maintenance of joint through fares is directly contrary to any such contention.
Finally, it should be noted that Paragraph 4 speaks of joint through routes. Note the plural on "route." Surely the word "routes" contemplates that more than one route was to be quoted, and not just the San Francisco-Spokane joint through route.
Greyhound attempts to prove that its agents did not violate Paragraphs 4 and 5 of the order by devoting an entire Appendix (D) of its brief to an analysis designed to prove that most of the ICC checks marked "incorrect" were not in violation of the order. It answered the evidence of violations compiled by Mt. Hood with a brief comment in a footnote.
Besides its general argument that it is not required by the order to quote any service except that San Francisco-Spokane joint through bus, which the court has rejected, supra, Greyhound makes five principal criticisms of the ICC's 1970 and 1971 surveys.
(1) Terminal changes.
Greyhound attempts to justify its agents' failure to quote joint through routes with Mt. Hood in 14 instances on the ground that a passenger would have to change terminals, either at Portland within a ten minute period, or at Salt Lake City within a thirty minute period.
Greyhound would excuse its agents' failure to voluntarily quote the Mt. Hood service on the basis that the passenger would have an insufficient amount of time to make the depot change. However, Greyhound should inform the passenger of the options, and permit the passenger to make the choice. Secondly, Greyhound's rationalization in these Salt Lake City situations is shocking in light of its refusal to permit Mt. Hood into the Salt Lake City terminal, notwithstanding the fact that in December, 1968, the ICC ordered Greyhound to permit Mt. Hood's buses into that terminal. This certainly seems to confirm the government's original charge of criminal contempt that Greyhound was and is using its own refusal to allow Mt. Hood buses into the Greyhound Salt Lake City depot as an alibi for its agents' failure to quote shorter or faster interline service with Mt. Hood.
(2) Parallel Routes
Greyhound attempts to justify its failure to quote joint through routes with Mt. Hood voluntarily or accurately in sixteen instances
In the 1971 ICC Survey, PX-3581 reveals that on July 14, 1971, Mr. Casey telephoned the Greyhound depot at Tacoma, Washington, and requested a departure for the morning of July 15 from Tacoma to Boise. The agent quoted an all-Greyhound route which had a total traveling time of eighteen hours and fifteen minutes, with a two and one-half hour layover. The agent could have quoted a Greyhound-Mt. Hood joint route between Tacoma and Boise that would have taken three hours and fifteen minutes less time to travel.
While the routes in question may be competitive and substantially parallel, Paragraph 4 of the order imposed upon Greyhound a duty to quote these joint routes with Mt. Hood. To permit Greyhound to avoid its obligations under this paragraph would in effect give it a license to destroy its only competitor in
(3) Meal Stops
Greyhound attempts to justify its agents' failure to quote joint through routes with Mt. Hood voluntarily or accurately in seven instances on the grounds that "no meal stops" for varying periods of time were involved.
(4) Next Bus Out
Greyhound attempted to justify some of its agents failure to voluntarily or accurately quote joint through routes with Mt. Hood that were several hours faster than the all-Greyhound service on the grounds that its agents quoted the all-Greyhound service since it was the "next bus out."
However, there is no indication that the inquirer, who was calling on the telephone, not appearing in person, asked for the "next bus out."
Greyhound also attempted to excuse a number of failures to quote relevant Mt. Hood service on the ground that its agents and information clerks are unfamiliar with small towns such as Toppenish, Pasco, and Wenatchee.
Finally, Greyhound defends fifteen failures to quote on the grounds that the all-Greyhound route over which the passenger was sent was only five to eight percent longer or slower than the interline service about which the passenger was kept ignorant. It is then contended that this is unobjectionable because the ICC has always tolerated a limited degree of circuity in routing.
After carefully reviewing Exhibits B and E and the respondent's arguments in defense of the charges, the court is compelled to conclude that Greyhound willfully failed to comply with the terms of Paragraphs 4 and 5. The fact that the ICC was able to document a rate of quoting error of 51% seventeen months after the order was effective is more than sufficient evidence to support a finding of criminal contempt. The element of willfulness required for a finding of criminal contempt is supplied by the fact that Greyhound failed to take meaningful corrective steps once it was informed
In addition to the ICC's survey and findings, the court had before it Mt. Hood's survey, which documented a quoting error rate of about 75%. Greyhound's attempts to minimize the import and impact of these surveys are simply insufficient. After being confronted with substantial evidence of non-compliance, Greyhound tried to rationalize the "incorrect" responses with whatever excuse imaginable, in an effort to reduce the percentage of quoting error to a tolerable level.
Before considering the last charge of contempt for violations of Paragraphs 4 and 5, the court must briefly mention one additional point raised by Greyhound. Greyhound stated that there is no evidence of a single instance in which a Greyhound agent quoted Mt. Hood's service "unfavorably or inaccurately" or in which Mt. Hood's service was not quoted "at all in response to specific requests." The surveys speak for themselves. They are replete with instances in which Greyhound failed to quote Mt. Hood's service accurately and favorably. Paragraph 4 required Greyhound to quote Mt. Hood's joint through routes voluntarily and accurately. Paragraph 5 required Greyhound to cease and desist from quoting Mt. Hood's service unfavorably and inaccurately, in response to inquiries from the traveling public. The court has already found that Greyhound did not conform with Paragraph 4 in that Greyhound did not voluntarily and accurately
Secondly, Greyhound argued that the existence of error and imperfection in quoting afford no ground for a finding of contempt. This is said to be particularly true in this case where, west of the Mississippi River, Greyhound has some eight hundred employees and two thousand commission agents engaged in quoting service to the public. In support of its argument Greyhound cites United States v. Kroger Grocery and Baking Co.,
As will be shown in the next section, Greyhound's reliance on Kroger is entirely misplaced. For the record in this case shows that not only did the errors occur, but, when one considers the inadequate measures Greyhound took to achieve compliance, it was almost inevitable that errors would occur.
GREYHOUND'S COMPLIANCE PROGRAM
The government has charged that Greyhound violated Paragraphs 4 and 5 of the order by issuing directives to its agents that were grossly inadequate in that such directives: (a) failed to state that Greyhound was under court order to volunteer full and accurate quotations of the most convenient routes, even when those routes are those of Mt. Hood; (b) suggested falsely that such quotations were always Greyhound's policy; (c) did not instruct that the passenger should always be sent by the shortest routes unless he requested otherwise; (d) did not indicate that compliance with the directive would be policed by Greyhound; and (e) did not state that agents or commission agents who failed to comply with the directive would be disciplined. The government concluded that Greyhound, by its own refusal to take affirmative measures to achieve compliance with the order, and by taking insufficient action to achieve full and accurate quotation of joint routes, knowingly and willfully disobeyed the order.
Greyhound stated that its program of achieving compliance through its employees and agents did not lend any support to the government's contempt charges. Greyhound took the position that the government's charges were not based upon any violation of the order and are criticisms unrelated to the terms of the order.
Initially the court must consider whether a criminal contempt can be predicated upon these charges, for the order did not specifically require Greyhound to do the things that are now charged as contempt. Once the order was entered Greyhound was left to its own devices with regard to just how compliance would be achieved. The real issue presented by the charges is whether Greyhound, and its top officials, took all reasonably necessary steps to insure compliance with the court's order.
The respondents in the criminal contempt petition are the Greyhound Corporation and Greyhound Lines, Inc. The law of corporate responsibility makes it clear that a corporation can be held responsible for the acts of its agents, Wilson
It was the court's careful consideration of the above factors which led to the reversal of Kroger's conviction.
The situation in Kroger invites comparison with In re Holland Furnace Co.,
The parallels in the case before the court to the facts of Holland Furnace are as striking as they are to the contrasts with Kroger: The analogies drawn in the Government's Brief aptly illustrate the parallels and contrasts:
The contrasts to Kroger and the similarities to Holland Furnace presented above speak very effectively for themselves. Greyhound's compliance effort was so deficient that it made this contempt proceeding inevitable. All of the deficiencies in Greyhound's compliance program charged by the government as contemptuous most certainly lead to Greyhound agents' failure to adequately quote Mt. Hood's service. Perhaps the most glaring defects in the Greyhound program were: (1) the failure of Greyhound to set forth in its bulletins that it was under a court order to volunteer full and accurate quotations of the most convenient routes (even when those routes are those of Mt. Hood); (2) the failure of Greyhound to adequately police the agents who were making the quoting violations; and (3) the failure of Greyhound to state that those who failed to comply would be subject to discipline.
Having made these findings, the court nevertheless feels compelled to discuss several matters raised by Greyhound in its brief, with respect to its compliance efforts.
Greyhound states that it began issuing bulletins to its agents in July, 1969, shortly after the ICC order and about 7
In September, 1971, two months after the contempt petitions were filed, Greyhound again reminded agents of their obligations under the order and attached copies of the order and all of Mt. Hood's schedules to the bulletin.
Greyhound stated that its bulletins went far beyond the terms of the order in directing agents to quote interline service with Mt. Hood. Greyhound also contended the importance of the bulletins was clear from the frequency with which they were issued. Greyhound further emphasized the seriousness of its purpose by requiring agents to acknowledge receipt and understanding of bulletins which is not a normal procedure, and requiring District Sales Supervisors to contact agents personally to see that the bulletins were received, understood and followed, and to report that all contacts were made.
Greyhound further stated that the government was aware of the bulletins issued since July, 1969, but it never suggested to Greyhound any dissatisfaction with the bulletins until it filed the contempt petitions alleging that they were "grossly inadequate."
Greyhound also stated that its program for instructing agents was tailored to the realities of the situation. Thus, rather than issuing a copy of the ICC or this court's order to its agents, and rather than threatening and punishing agents for failure to comply with the bulletins, Greyhound required that the agents who would be most directly involved submit direct acknowledgments of bulletins. Bulletins issued to agents less likely to encounter passengers who could use Mt. Hood's service were acknowledged by supervisors. Agents far removed from Mt. Hood's operations were provided information on Mt. Hood's services in the revised Greyhound tables and maps in Russell's Guide.
Of course, the government would not know how inadequate the bulletins were until they obtained the evidence of noncompliance in July, 1971. Only then could the government decide that the bulletins were "grossly inadequate." Compliance with the order was primarily Greyhound's responsibility. It had to take the steps necessary to achieve compliance. And if the steps Greyhound took were not adequate, as they obviously were not, then it must suffer the consequences. The record in this case has shown that Greyhound was advised by the ICC (and Mt. Hood) that its compliance with Paragraphs 4 and 5 was not satisfactory. Greyhound knew its agents were being checked by the ICC. The ICC surveys illustrate that regardless of the number of bulletins Greyhound sent to its employees and agents, their message was not coming through. If the bulletins were doing their job, one would expect that Greyhound could have reduced the level of quoting error documented by the ICC and Mt. Hood to a negligible level. But as shown above, the ICC's 1970 Survey (Exhibit B) documented a rate of error of 61% and the ICC's 1971 Survey (Exhibit E) documented a rate of error of 51%. These surveys illustrate just how inadequate the bulletin and acknowledgment program was to achieve compliance.
As for Greyhound's telephone checks, the government stated it was to be expected that Greyhound would make extensive use of these checks if it was making a reasonable and adequate effort to achieve compliance. Of course, the order did not require Greyhound to
Here again, the results of the ICC Surveys illustrate the inadequacy of Greyhound's method of achieving compliance. Having chosen a course of action, Greyhound must bear the responsibility for the failure of that course to achieve the desired end.
The real issue here is whether Greyhound took all steps reasonably necessary to insure compliance with Paragraphs 4 and 5. True, the order did not explicitly require Greyhound's bulletins to state that the company was under a court order to quote Mt. Hood's routes in certain circumstances, or to state that compliance with the directive would be policed by Greyhound, or to state that agents who failed to comply with the directive would be subject to discipline, etc. But Greyhound had an obligation to secure prompt and full compliance with all provisions of the order by whatever means were available to it. In the Answering Brief, Greyhound discussed its compliance program; as indicated above, it consisted of the distribution of bulletins which informed agents that they were to quote Mt. Hood's service in certain situations; Greyhound also made telephone checks on compliance, but rather than make an extensive record of its efforts, Greyhound chose to use on the spot corrections. This Greyhound was free to do. However, it must bear the legal consequences of the failure by its agents to comply with Paragraphs 4 and 5. Wilson v. United States, supra, and Parker v. United States, supra.
In light of the documented evidence of violations of Paragraphs 4 and 5 (Exhibits B and E of Gould's Affidavit and PX 20, Donohue Exhibit A), the court must conclude that Greyhound did not take all steps reasonably necessary to achieve compliance with the order. The most damaging aspect of the evidence is that in July, 1971, about eighteen months after the order was entered, the ICC recorded a 51% rate of incorrect responses, compared to a 58% rate of error in June and July, 1970—six months after the order was entered. These figures strongly suggests that whatever means Greyhound used to insure compliance (bulletins, spot-telephone checks, and agent training) they were not effective means. Certainly, the court would not expect there to be 100% accuracy in the quotation of Mt. Hood's service, but the 51% rate of error recorded in July, 1971, fully supports finding that Greyhound's compliance program left something to be desired. It appears that Greyhound designed a "paper compliance" program, i. e., one in which it sent, received, and accumulated many pieces of paper (bulletins) designed to prove that it had made an effort to comply with Paragraphs 4 and 5. But Greyhound failed to translate that program from the paper bulletins into an effective quoting effort. For if it had, the court would not have a situation where out of over five hundred and thirteen quoting checks over an eighteen month period, by the ICC and Mt. Hood, there were three hundred and forty-four unsatisfactory quotes, or 67% incorrect.
The government has proven beyond a reasonable doubt that there was a willful failure to comply with Paragraphs 4 and 5. Furthermore, responsibility for the failure to comply must fall upon Greyhound. It had the duty to insure that there would be compliance with the order, and it must be held accountable for its failure to secure that compliance. The high percentage of documented quoting errors flys in the face of any Greyhound contention that it did all that it could do to insure compliance. And as illustrated above, the Greyhound effort at compliance was no where that of the Kroger Company.
Accordingly, the court hereby finds Greyhound in criminal contempt for willfully failing to comply with Paragraphs 4 and 5.
VIOLATIONS OF PARAGRAPH 6
Paragraph 6 of the order required Greyhound to show Mt. Hood's connecting routes on its maps on an equal basis with other non-Greyhound carriers.
The government charged: (1) that Greyhound's map in Russell's Guide (p. 54) and in the Greyhound Lines-West Systems Timetable (p. 2), (a) distorts the location of Bend, Oregon; (b) omits Greyhound's routes between The Dalles (Biggs) and Toppenish and Yakima, Washington; and (c) distorts Mt. Hood's service in table 7786 and schedules included in it by showing only a portion of it and omitting Portland to Bend and Boise to Salt Lake City; (2) that Greyhound's Ticket Tear Map. No. 16 did not show any of Mt. Hood's service until October, 1970, and on that date a revised issue of that map distorted and omitted several of Mt. Hood's routes; (3) that the folder 1971 Amazing American Vacations . . . by Greyhound contains a map on its center page which omits all Mt. Hood routes; (4) that the wall maps on public display in Greyhound terminals in Eugene, Corvallis, Albany, and Klamath Falls, Oregon, and Redding and San Jose, California, omit many of Mt. Hood's routes; (5) that Greyhound's map entitled "Approximate Greyhound Travel Time in Hours between Principal Cities," which appears in a Greyhound folder failed to indicate that passengers between San Francisco and Spokane can travel via the joint Mt. Hood-Greyhound through-bus.
In its response Greyhound admitted the fact of publication of the various folder maps and the existence of the
The court, having examined the full record of these matters, finds that the respondents willfully failed to comply with the provisions of Paragraph 6, in that they failed to show Mt. Hood's routes on its maps on an equal basis with other non-Greyhound carriers. There is more than sufficient evidence to support the charges of criminal contempt. It should be noted that in evaluating the evidence the court was guided solely by the "equal basis" language of the order. Thus, the court required that Mt. Hood be treated at least as well as any other non-Greyhound carrier.
GREYHOUND LINES-WEST INDEX MAP
The government charged that this map omitted certain of Mt. Hood's routes and distorted others. In January, 1970, at the time of this court's order, this map only showed Mt. Hood's route between Klamath Falls and The Dalles. The map failed to show several of Mt. Hood's connecting routes. After the court's order was issued, Mt. Hood's official offered suggestions to Greyhound which would bring about compliance with this paragraph.
At the May 26, 1970, meeting between Greyhound, Mt. Hood, and the ICC Director, Mr. Gould, Greyhound showed resistance to complying with Paragraph 6, when it took the position that the document in question was an "Index," not a map, and that Greyhound was not obligated to show competing service on that document.
In July, 1970, Greyhound added some of Mt. Hood's connecting routes but it still omitted some key ones. Furthermore, in adding routes to Bend, Greyhound distorted its location to the detriment of Mt. Hood, in that it incorrectly indicated to a ticket agent selling, or a passenger desiring service from northwestern Oregon to Boise, Idaho, that the all-Greyhound route via Portland would in all cases be faster or shorter than Mt. Hood's route via Bend.
In November, 1971, twenty months after this court's order, Greyhound finally added Mt. Hood's connecting routes on the Index Map, in particular Mt. Hood's Portland-Bend and Boise-Salt Lake City routes.
It is evident from the Index Map itself that Greyhound's failure to show Mt. Hood's connecting routes
In defense of this charge, Greyhound stated that the purpose of the map is to serve as an index to Greyhound schedules found in the tables which follow; it does not purport to represent a geographically accurate map
As for other particular routes mentioned in the contempt petitions in connection with the Index Map, the court makes the following findings:
GREYHOUND'S TICKET TEAR MAP NO. 16
The government charged that Greyhound omitted and distorted some of Mt. Hood's service on this map, thus failing to treat Mt. Hood on an equal
Notwithstanding Greyhound's stated objections, it did agree to show Mt. Hood's routes on this map and said it would be reissued in about 30 days. However, the map that was to be issued in "about 30 days" did not appear until October 1, 1970, four months after the meeting and ten months after the order. And when the map did appear, it omitted important segments of Mt. Hood's routes, and distorted others.
That Greyhound did not treat Mt. Hood on an equal basis with other non-Greyhound carriers is evident from the ticket tear map that was in use in April, 1970, and the revised one was in use at least through March, 1972. That Greyhound map showed all of the routes of companies such as Boise-Winnemucca States, Inc., including those parallel with Greyhound.
Mt. Hood, under the "equal basis" language of the order, had requested that all of its routes be shown, including those parallel with Greyhound. Yet, Greyhound, still pursuing its vendetta against Mt. Hood, failed to treat Mt. Hood on an equal basis with other non-Greyhound carriers. In presenting Mt. Hood's routes, Greyhound omitted and distorted them. Greyhound's reluctance to provide a fair and full presentation of Mt. Hood's routes on this map, as it presents the routes of other non-Greyhound carriers, is blatantly contemptuous of Paragraph 6.
Greyhound defends against this charge by stating that the primary purpose of the ticket tear map is to instruct Greyhound agents how to coupon tickets, i. e., the map tells them to provide a separate coupon for each route segment between points circled on the map. Greyhound further stated that (1) the map does not purport to be a geographically accurate, or even a complete map of the routes as it omits some Greyhound
Finally, Greyhound contends that upon filing of the contempt petitions, the distortions and omissions in the map were corrected. Greyhound did not publish a revised ticket tear map until May 1972, more than ten months after the contempt petition was filed.
Accordingly, the court hereby finds that Greyhound's failure to show Mt. Hood's full service on the ticket tear map was a willful failure to comply with Paragraph 6.
VIOLATIONS WITH REGARD TO WALL MAPS AT AGENCIES
The criminal contempt petitions charged that the wall maps on public display in Greyhound terminals in Eugene, Corvallis, Albany, and Klamath Falls, Oregon, and Redding and San Jose, California, among others, omit many of Mt. Hood's routes.
On the basis of the evidence before it, the court must conclude that Greyhound's failure to correct the wall maps in the various terminals was willful disobedience of Paragraph 6. Greyhound knew what was expected of it, yet it failed to take corrective action for twenty months after the court's order. Not once during that period of delay did Greyhound ever complain to the ICC or the court that compliance would be a hardship, nor did it ever ask the court for a clarification or modification of the order, as it had a right to do, to determine whether the showing of Mt. Hood's routes on its wall maps was within the requirements of the order.
The principal evidence of wall map discrimination against Mt. Hood is
In defense of these charges Greyhound stated (1) that the order did not require them to show competing lines on the wall maps as it was not shown that the lines of other non-Greyhound carriers appeared on these maps;
Greyhound's contentions are without merit. There was testimony to the effect that the wall maps entitled "Greyhound Lines and Principal Connecting Carriers" did in fact show the lines of other carriers, see for example, the testimony of Niskanen and Wallenburn, supra. Furthermore, the very title of these maps implies that they showed not only Greyhound's lines, but also those of "Principal Connecting Carriers."
The argument that Mt. Hood could have provided joint agents with map material is irrelevant. The order required Greyhound to treat Mt. Hood on an equal basis with other non-Greyhound lines. If Greyhound showed other lines on these maps it had a duty to show Mt. Hood's lines as well.
While it appears that these wall maps were corrected, it is significant that it took Greyhound until September, 1971, twenty months after the order was entered, to accomplish the job. During that period, Greyhound never complained to the ICC or this court that it was not required to show Mt. Hood's routes on this map, or that the task was too difficult.
In light of the foregoing, the court hereby finds that Greyhound's failure to
VIOLATIONS REGARDING GREYHOUND TOUR FOLDERS
The government charged as contempt that the folder "1971 Amazing American Vacations, Escorted, Independent, and Special Event Tours by Greyhound" contained a map on its center pages entitled "Greyhound Lines and Principal Connecting Lines" which omits all Mt. Hood routes. The court is of the opinion that the failure to show Mt. Hood's routes on this map constituted a willful failure to comply with Paragraph 6.
The folder which contained the map in question was distributed in February, 1971, to the Pacific Trailways agent at Bend, Oregon. Donohue, upon receiving the map noticed that the map in the center omitted all of Mt. Hood's routes.
In defense of the charges, Greyhound urged that the map in question was published in a folder unrelated to the subject matter of the order, and that in any event, this map's publication was suspended in November, 1971, and superseded by one which shows Mt. Hood's connecting routes. It was also argued that the map is essentially illustrative, would not be used for quoting regular route transportation, and the map was a nationwide Greyhound System Map showing the principal national Greyhound routes and only a relatively few routes of other carriers.
These defenses are insufficient to negate a finding that the publication of this map without Mt. Hood's routes was a willful violation of this order. Greyhound's last argument has already been discussed. Suffice it to say that as long as Greyhound showed the routes of any connecting carriers on this map, it should have shown those of Mt. Hood.
The fact that the map would not be used for quoting regular service does not exonerate Greyhound. Paragraph 6, was designed to insure that Mt. Hood's service would be shown on an equal basis with other non-Greyhound carriers, which simply means that if Greyhound shows the connecting service of any non-Greyhound carrier, it should also show the service of Mt. Hood. The equal basis language of the order means Mt. Hood must be treated at least as well as any other non-Greyhound line. Here was a map which showed the connecting routes of some non-Greyhound Lines, but not those of Mt. Hood. The only conclusion that can be drawn is that Mt. Hood was not treated at least as well as other non-Greyhound carriers.
The fact that the map has been obsolete since November, 1971, will not suffice to excuse Greyhound for omitting Mt. Hood's routes. The court's order was entered in February, 1970, and within a reasonable period of time Greyhound should have complied with all of its provisions. Greyhound cannot now claim that because it discontinued publication of a discriminatory map, twenty months after the date of the order, that it was not a violation of the court's order for the period of time that the map was in use.
The court hereby finds that the failure of Greyhound to show any of Mt. Hood's routes on the map in this tour folder from February, 1970, to November, 1971, was a willful violation of Paragraph 6.
ALLEGED VIOLATIONS PERTAINING TO A GREYHOUND INSET MAP
The government charged that Greyhound's map entitled "Approximate Greyhound Travel Time in Hours between Principal Cities," in the Greyhound folder "Now You Can Ride Greyhound's Big Bold and Beautiful Super 7 Scenicruisers," violated Paragraph 6.
The court is of the opinion that the failure of Greyhound to publish Mt. Hood's routes in this small map does not constitute a violation of the order. The map in question is a small inset map on a folder page which contains a large map which does show all of Mt. Hood's routes. In addition, the inset map is clearly marked as "Approximate Greyhound Travel Time . . . ." The court does not believe that the absence of Mt. Hood's routes on this inset map will have a detrimental effect on agents quoting service or travelers inquiring for service. The failure to show Mt. Hood routes on this map is not contemptuous.
Of the alleged violations of Paragraph 6, the government established beyond a reasonable doubt that five of these were willful violations of the order. Accordingly, the court hereby finds the respondents in criminal contempt for their failure to comply with Paragraph 6.
VIOLATIONS OF PARAGRAPH 8
Paragraph 8 of the Order required Greyhound to establish joint through fares with Mt. Hood.
The government charged that Greyhound knowingly and willfully violated Paragraph 8 in that Greyhound refused to establish joint through fares with Mt. Hood. In particular, Greyhound is charged with not having established a joint through fare with Mt. Hood for service from Medford to The Dalles via Klamath Falls, Oregon. Having carefully evaluated the record of this charge, the court is of the opinion that there is no evidence to support the charge. Accordingly, the court hereby finds Greyhound not guilty of either civil or criminal contempt.
The government's contempt petitions speak in terms of a refusal by Greyhound to establish a joint through fare, yet the evidence speaks in terms of a fare equalization. A joint through fare and a fare equalization are not the same.
An analysis of the testimony presented in support of the charge reveals that the government's complaint is not that
The complaint charged Greyhound with a failure to establish a joint through fare with Mt. Hood from Medford to The Dalles, via Klamath Falls. Greyhound denied the charge and further alleged that
Rather than presenting evidence of Greyhound's failure to establish joint through routes, the government merely described a failure by Greyhound to concur in a fare equalization—a matter not remotely covered by the order. For example, during the deposition of Mr. Cook, the government attorney asked if Mt. Hood had made a prior request to "equalize the fare applicable from Medford to The Dalles via Klamath Falls with the fare between those points applicable via Portland."
Since Paragraph 8 does not require or speak in terms of fare equalizations, it would be wholly improper for this court to predicate a finding of either civil or criminal contempt upon the evidence presented by the government. Paragraph 8 required only that Greyhound establish joint through fares with Mt. Hood and since that which was required was done, there can be no civil or criminal contempt.
VIOLATIONS OF PARAGRAPH 9
Paragraph 9 of the order required Greyhound to cease and desist from discriminating against Mt. Hood at depots that Mt. Hood occupies with Greyhound.
The government charged that Greyhound knowingly and willfully violated Paragraph 9 in that: (1) a survey conducted by Mrs. Connie Allen, an interline revenue clerk for Mt. Hood, revealed that on December 12, 1970, the agent at the Klamath Falls depot, which Mt. Hood jointly occupies with Greyhound, quoted Greyhound charter service, but not Mt. Hood's charter service; (2) on December 18, 1970 the agent at the Albany depot, a jointly occupied depot, quoted Greyhound charter service, but not that of Mt. Hood; and (3) on December 12, 1970, while Mrs. Allen was present in the Klamath Falls depot, Greyhound service to Portland was announced, but not similar Mt. Hood service. The government also added that the charges under Paragraphs 4 and 5 are violations of this Paragraph.
Greyhound denied that it discriminated against Mt. Hood at joint depots and denied that the failure of agents at Klamath Falls and Albany to voluntarily quote Mt. Hood charter service without a specific request therefore was a violation of this provision of the order. Greyhound also denied that the failure of the Klamath Falls agent to announce
The evidence of alleged violations was contained in the affidavit of Mrs. Connie Allen, a Mt. Hood interline revenue clerk. She stated that on December 11, 1970, she called the Albany depot to inquire about charter service. The agent is said to have quoted only Greyhound bus service. However, during Mrs. Allen's deposition, she stated that the matter of whether the charter service she was quoted was Greyhound or Mt. Hood's never came up and her own notes of the conversation bear this out.
Mrs. Allen's affidavit also stated that on December 12, 1970, she called the Klamath Falls depot for a quote on a chartered bus. The agent is said to have quoted Greyhound's charter service but not Mt. Hood's charter service. Yet, the import of Mrs. Allen's testimony is diminished by the testimony of Mr. Wallenburn, the joint depot agent at Klamath Falls, who testified that as a rule he and his reservation clerks ask the party seeking charter information which bus line they prefer. He further testified that in certain cases they will favor one bus or the other to meet a specific customer need.
The final incident reported by Mrs. Allen and charged by the government as discrimination against Mt. Hood, pertains to the manner in which the Klamath Falls dispatcher announced departing service. The petition states that on December 12, 1970, while Mrs. Allen was in the Klamath Falls terminal, Greyhound service to Portland, Oregon, was announced but not similar or alternative Mt. Hood service. Mrs. Allen testified that the dispatcher, when he announced the 6:30 a.m. departure of the Mt. Hood bus failed to call "connections to Portland."
The court must conclude that the failure of the dispatcher to announce Mt. Hood service to Portland was not discrimination against Mt. Hood for the simple reason that the Mt. Hood bus did not go to Portland. A passenger on the Mt. Hood bus that was announced, who was destined for Portland, would have to change buses at Madras, Oregon. The Greyhound bus called by the dispatcher, which departs about the same time as the Mt. Hood bus, goes directly to Portland; it is shorter and faster than the Mt. Hood service via Madras. In light of these facts, there can be no finding of contempt based upon the dispatcher's failure to call Mt. Hood's bus as one going to Portland.
The court is of the opinion that the government has failed to prove either by clear and convincing evidence or beyond a reasonable doubt that Greyhound discriminated against Mt. Hood at jointly occupied depots. Accordingly,
Finally, the court finds it necessary to comment upon certain evidence of alleged violations of Paragraph 9 which the government presented in its brief, but which the court did not regard as relevant to the charges. The government's brief introduced as evidence of discrimination the fact that certain depot wall maps failed to adequately show Mt. Hood's routes and the fact that at one joint depot, the telephone was answered "Greyhound information." However, the government did not charge these acts as specific acts of contempt in either the civil or criminal petitions. Evidence of acts and omissions that were not charged as specific contempts are irrelevant to prove the substantive charge, and no finding of contempt can be based upon such evidence.
III. CIVIL CONTEMPT CHARGES
The amended civil contempt petition's allegations are identical to those of the criminal contempt petition. Inasmuch as there has been an extensive discussion of those charges and the supporting evidence, it will be unnecessary to discuss them again, except in those situations where Greyhound still has not complied with the order and thereby is continuing its contempt.
A civil contempt action is remedial in nature in that it is brought to compel obedience to a court's order. Once compliance has been achieved, civil sanctions are no longer necessary or appropriate. Here, the government has admitted that substantial compliance has been achieved with regard to Paragraphs 1 and 6. The court found neither civil nor criminal contempt as to Paragraphs 2, 8, and 9. This leaves for present consideration only whether there are continuing violations of Paragraphs 3, 4, and 5. In contrast to criminal contempt, a civil contempt may be predicated upon a finding of "clear and convincing" evidence that there was a lawful order and a violation of that order. Willfulness is not an essential element of civil contempt.
In this civil contempt proceeding, the respondents are: The Greyhound Corporation, and its President, Mr. R. F. Shaffer; Greyhound Lines, Inc., and its President, Mr. J. L. Kerrigan; and Mr. F. L. Nageotte, President of Greyhound Lines-West.
The three individual respondents are actively engaged in the management, direction and control of Greyhound's affairs. Each of these men shared first line responsibility for assuring compliance with this court's order by reason of their executive positions with Greyhound.
The record in this case fully supports a finding that Greyhound and the individual respondents failed at least until the case was taken under advisement, in June, 1972, to effectuate full compliance with Paragraphs 3, 4, and 5. Inasmuch as the court has already found that Paragraphs 3, 4, and 5 were not obeyed, the court hereby adopts those findings for civil contempt purposes.
As for the violations by The Greyhound Corporation and Greyhound Lines, Inc., as named persons subject to the order, they stand or fall on the basis of the compliance program they delegated
As for the individual corporate officers, the Supreme Court has made them responsible for their acts. A command to a corporation is in effect a command to those who are officially responsible for the conduct of its affairs. If they, apprised of the order directed to the corporation, prevent compliance or fail to take appropriate action within their power for the performance of the corporate duty, they, no less than the corporation, are guilty of disobedience and may be punished for contempt. Wilson v. United States,
In this case, Nageotte was in charge of Greyhound's entire compliance program. He personally conducted negotiations with Mt. Hood. He was responsible for the decision not to send copies of the order to Greyhound agents, not to follow up any of Mt. Hood's telephone checks, and not to discipline any agents for violations that they committed.
As for Mr. Kerrigan, former President of Greyhound Lines East, he knew of the order and of the fact that Greyhound agents in the east sometimes were called upon to quote service to the Pacific Northwest. He also admitted that he was aware of and implicitly concurred in the decision not to send any bulletins regarding quoting to Greyhound agents in the east. And he concurred in the decision not to mention the order of court decisions in the company's bulletins.
Mr. Shaffer, now the President of Greyhound Corporation and President of Greyhound Lines, Inc. at the time of the issuance of the order, was not produced
The law is clear that neither Shaffer nor Kerrigan can evade their legal duty by refraining from involvement. The defense of non-involvement was raised by two respondents in the criminal contempt action, In re Dolcin Corp., 101 U.S.App.D.C. 118,
In this case, the Greyhound officers in whom responsibility for compliance with the order rested in the first instance had an affirmative duty to act to insure compliance. They had to take all steps reasonably necessary to insure that this court's order would be obeyed. That they failed to do their duty is evident from the fact that violations of some paragraphs continued beyond the date of the filing of the contempt petitions; other paragraphs were complied with only as the pressure of this litigation became too great to bear. Responsibility for Greyhound's continuing failure to comply with Paragraphs 3, 4, and 5, must lie not only with the corporation, but also with those individuals who by reason of their executive positions had the duty to insure that the order of this court would be obeyed.
As of the date that this case was taken under advisement, there was no indication that the good faith negotiations required by Paragraph 3, had been concluded. Yet the order specifically commanded Greyhound to "negotiate in good faith with Mt. Hood on the establishment of bus schedules most advantageous to the traveling public." Nageotte, as Greyhound's chief negotiator, must bear responsibility for this continuing
Accordingly, the court hereby adjudges The Greyhound Corporation, Greyhound Lines, Inc., Mr. R. F. Shaffer, Mr. J. L. Kerrigan, and Mr. F. L. Nageotte to be in civil contempt for continuing disobedience of Paragraphs 3, 4, and 5, of this court's order.
In the criminal petition the government has asked that an appropriate fine be imposed upon the corporate respondents and that the government be awarded the cost of this proceeding.
In the civil petition the government has asked for:
The Pre-Trial Order for this case states that there shall be further briefing and hearing on the issue of appropriate sanctions for relief. The government shall have twenty days from the date of this order to file a brief on the issue of sanctions. The respondents shall thereafter have twenty days to answer. The government shall then have ten days to reply.
It is therefore, ordered that the foregoing opinion shall stand as findings of the fact and conclusions of law.
Respondents Greyhound Corporation and Greyhound Lines, Inc., are hereby adjudged to be in criminal contempt for willful violations of Paragraphs 1, 3, 4, 5, and 6, of this court's order dated February 5, 1970.
Respondents Greyhound Corporation, Greyhound Lines, Inc., J. L. Kerrigan, R. F. Shaffer, and F. L. Nageotte, are hereby adjudged to be in civil contempt for continuing violations of Paragraphs 3, 4, and 5, of this court's order dated February 5, 1970.
The corporate and individual respondents are hereby found not guilty of either civil or criminal contempt for alleged violations of Paragraphs 2, 8, and 9.
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