BRAE CORP. v. UNITED STATES

No. 83-1462. 1543.

740 F.2d 1023 (1984)

BRAE CORPORATION, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, E.F. Hutton Credit Corporation, Seattle & North Coast Railroad Company, Intervenors. BRAE CORPORATION, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Pittsburgh & Lake Erie Railroad Company, Consolidated Rail Corporation, American Short Line Railroad Association, Southern Pacific Transportation Company, Common Carrier Conference-Irregular Route of American Trucking Associations, Inc., Angelina and Neches River Railroad, E.F. Hutton Credit Corporation, Weyerhaeuser Company, et al., Intervenors. BRAE CORPORATION, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Pittsburgh & Lake Erie Railroad Company, American Short Line Railroad Association, Freight Users Association of Long Island, Inc., Consolidated Rail Corporation, Southern Pacific Transportation Company, Angelina and Neches River Railroad, E.F. Hutton Credit Corporation, Weyerhaeuser Company, et al., Intervenors. BRAE CORPORATION, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, Freight Users Association of Long Island, Inc., Southern Pacific Transportation Company, E.F. Hutton Credit Corporation, Intervenors. AMERICAN PAPER INSTITUTE, INC., Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Brown Transport Corporation, Consolidated Rail Corporation, Freight Users Association of Long Island, Inc., Southern Pacific Transportation Company, Common Carrier Conference-Irregular Route of American Trucking Associations, Inc., Angelina and Neches River Railroad, Brick Association of North Carolina, et al., American Trucking Associations, Inc., et al., National Grain and Feed Association, American Newspaper Publishers Association, Canadian Pulp and Paper Association, Intervenors. INTERNATIONAL PAPER COMPANY, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, Southern Pacific Transportation Company, Common Carrier Conference-Irregular Route of American Trucking Associations, Inc., Brick Association of North Carolina, et al., Intervenors. The NATIONAL INDUSTRIAL TRANSPORTATION LEAGUE, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, Southern Traffic League, Inc., Southern Pacific Transportation Company, Eastern Industrial Traffic League, Inc., Brick Association of North Carolina, et al., Volkswagen of America, Inc., Intervenors. ITEL CORPORATION, Rail Division, et al., Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, East Camden & Highland Railroad Company, Funding Systems Railcar, Inc., et al., Southwest Forest Industries, Inc., Valdosta Southern Railroad Company, Apalachicola Northern Railroad Co., et al., Sabine River & Northern Railroad Company, Marinette, Tomahawk & Western Railroad Co., Little Rock & Western Railway Corp., et al., Southern Pacific Transportation Company, Intervenors. FORD MOTOR COMPANY, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Canadian Pulp and Paper Association, Brick Association of North Carolina, et al., Southern Pacific Transportation Company, Consolidated Rail Corporation, Intervenors. CONTINENTAL FOREST INDUSTRIES, INC., Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Canadian Pulp and Paper Association, Brick Association of North Carolina, et al., Southern Pacific Transportation Company, Consolidated Rail Corporation, Intervenors. SYSCO CORPORATION, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Brick Association of North Carolina, et al., Southern Pacific Transportation Company, Consolidated Rail Corporation, Intervenors. Patrick W. SIMMONS, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Southern Pacific Transportation Company, Consolidated Rail Corporation, Intervenors. The ALUMINUM ASSOCIATION, INC., Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Canadian Pulp and Paper Association, Brick Association of North Carolina, Burlington Northern Railroad Company, Southern Pacific Transportation Company, Consolidated Rail Corporation, Intervenors. The BANGOR AND AROOSTOOK RAILROAD COMPANY, Delaware and Hudson Railway Company and Maine Central Railroad Company, Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, Southern Pacific Transportation Company, Intervenors. CANADIAN NATIONAL RAILWAY COMPANY and Canadian Pacific Limited, Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, Southern Pacific Transportation Company, Intervenors. NATIONAL RAILWAY UTILIZATION CORPORATION, Pickens Railroad Co., Peninsula Terminal Co., The Mississippian Railway, Inc., Graham County Railroad, Inc., Atlantic & Western Railway Co., Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, Intervenors. CENTRAL VERMONT RAILWAY, INC., Detroit, Toledo and Ironton Railroad Company and Grand Trunk Western Railroad Co., Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, Intervenors. SEA-LAND SERVICE, INC. and Sea-Land Freight Service, Inc., Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Totem Ocean Trailer Express, Inc., Intervenor. H.C. SPINKS CLAY CO., INC., Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. BOARD OF TRADE OF the CITY OF CHICAGO, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, Consolidated Rail Corporation, Intervenors. SANDERSVILLE RAILROAD COMPANY, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. ILLINOIS CENTRAL GULF RAILROAD CO., et al., Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. CHATTAHOOCHEE INDUSTRIAL RAILROAD, Great Southern Paper, Leaf River Forest Products, Inc., and The Old Augusta Railroad Co., Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. BESSEMER AND LAKE ERIE RAILROAD COMPANY and Elgin, Joliet and Eastern Railway Company, Petitioners, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. AMERICAN PAPER INSTITUTE, INC., Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. LAMOILLE VALLEY RAILROAD CO., OF MORRISVILLE, LAMOILLE COUNTY, VERMONT, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. RUBBER MANUFACTURERS ASSOCIATION, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents, National Industrial Transportation League, Intervenor. EVANS PRODUCTS COMPANY, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. BOARD OF PORT COMMISSIONERS FOR the CITY OF OAKLAND, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents. The NATIONAL INDUSTRIAL TRANSPORTATION LEAGUE, Petitioner, v. UNITED STATES of America and Interstate Commerce Commission, Respondents.

United States Court of Appeals, District of Columbia Circuit.

Decided June 27, 1984.

As Amended July 20 and August 24, 1984.


Attorney(s) appearing for the Case

Robert N. Kharasch, Mark L. Evans, Gerry Levenberg, and John M. Nannes, Washington, D.C., with whom Peter D. Dickson and Deborah M. Gottheil, Washington, D.C., for Brae Corp., Robert N. Kharasch, Olga Boikess, and Edward D. Greenberg, Washington, D.C., for Intern. Paper Co., et al., John F. Donelan, John M. Cleary, Frederic J. Wood, and Nicholas J. Di Michael, Washington, D.C., for Nat. Indus. Transp. League, et al., Carl V. Lyon and James P. Tuite, Washington, D.C., for Itel Rail Corp., Rail Div., et al., Charles H. White, Jr., Washington, D.C., for SYSCO Corp., et al., Gordon P. MacDougall, Washington, D.C., for Patrick W. Simmons, Dickson R. Loos and David H. Baker, Washington, D.C., for Aluminum Ass'n, Inc., Brian C. Mohr, for Bangor and Aroostook R. Co., et al., Andrew P. Goldstein, Washington, D.C., for Nat. Ry. Utilization Corp., et al., John C. Danielson, for Central Vermont RR., et al., Thomas F. McFarland, Jr., and Steven J. Kalish, Chicago, Ill., for Bd. of Trade of the City of Chicago, et al., Peter A. Greene, Washington, D.C., for Angelina and Neches River R. Co., J. Raymond Clark and Mary Todd Foldes, Washington, D.C., for Sandersville R. Co., Hanford O'Hara and Alice C. Saylor, Monroeville, Pa., for Bessemer & Lake Erie R. Co., et al., Robert Gensburg, St. Johnsbury, Vt., for Lamoille Valley R. Co. of Morrisville, Lamoille County, Vermont, Martin W. Bercovici, Washington, D.C., for Rubber Mfrs. Ass'n., Robert A. Cantor and David A. Vaughn, New York City, for E.F. Hutton Credit Corp., Fritz R. Kahn and Russell E. Pommer, Washington, D.C., for Pittsburgh and Lake Erie R. Co., Seattle and North Coast R. Co., and Weyerhaeuser Co., et al., Thomas C. Dorsey, Washington, D.C., for American Short Line RR. Ass'n, and Charles W. Chapman, Washington, D.C., for East Camden & Highland Railroad Company, were on the joint brief, for petitioners and intervenors Brae Corporation, et al., in Nos. 83-1462, 83-1465, 83-1466, 83-1468, 83-1469, 83-1479, 83-1490, 83-1538, 83-1543, 83-1544, 83-1546, 83-1547, 83-1551, 83-1555, 83-1571, 83-1572, 83-1577, 83-1614, 83-1628, 83-1665, 83-1673, 83-1700, 83-1709, 83-1710, 83-1717, and 83-2245. John F. Donelan, Jr., Washington, D.C., also entered an appearance for Nat. Indus. Transp. League, et al., in Nos. 83-1700 and 83-2245. Harold E. Spencer, Chicago, Ill., also entered an appearance for Evans Products Co. in No. 83-1717. Basil Cole, Washington, D.C., also entered an appearance for Central Vermont Ry., Inc., et al., in No. 83-1572. Howard D. Koontz, Chicago, Ill., also entered an appearance for Illinois Central Gulf R. Co., et al., in No. 83-1655.

Richard Flynn, Washington, D.C., with whom Terence M. Hynes, Washington, D.C., was on the brief, for petitioners Canadian Nat. Ry. Co., et al., in No. 83-1558. John Will Ongman, Washington, D.C., also entered an appearance for Canadian Nat. Ry. Co., et al., in No. 83-1558.

John Guandolo, Washington, D.C., with whom George W. Selby, Jr., Washington, D.C., for Sea-Land Service, Inc., et al., and Brock Adams and Joseph H. Dettmar, Washington, D.C., for Totem Ocean Trail Exp., Inc., were on the joint brief, for petitioners and intervenor Sea-Land Service, Inc., et al., in No. 83-1574. John T. Downing, Washington, D.C., also entered an appearance for Sea-Land Service, Inc., et al., in No. 83-1574.

Michael Joseph, Washington, D.C., with whom T.S.L. Perlman, Washington, D.C., was on the brief, for petitioner Bd. of Port Com'rs for the City of Oakland in No. 83-1718.

John Broadley, Gen. Counsel, I.C.C., Washington, D.C., with whom J. Paul McGrath, Asst. Atty. Gen., Dept. of Justice, Henri F. Rush, Associate Gen. Counsel, Louis Mackall and Richard J. Osterman, Jr., Attys., I.C.C., and Barry Grossman and John P. Fonte, Attys., Dept. of Justice, Washington, D.C., were on the joint brief, for respondents.

Paul A. Cunningham, Washington, D.C., with whom Arthur W. Adelberg, Bruce B. Wilson, Washington, D.C., and Richard A. Mehley, Philadelphia, Pa., for Consol. Rail Corp., William R. Power, St. Paul, Minn., for Burlington Northern R. Co., Thormund A. Miller and Louis P. Warchot, San Francisco, Cal., for Southern Pacific Transp. Co., were on the joint brief, for intervenors Consol. Rail Corp., et al., in Nos. 83-1462, 83-1465, 83-1466, 83-1468, 83-1469, 83-1479, 83-1490, 83-1538, 83-1543, 83-1544, 83-1546, 83-1547, 83-1551, 83-1555, 83-1558, 83-1571, 83-1572 and 83-1614.

Nelson J. Cooney and Kenneth E. Siegel, Washington, D.C., for American Trucking Associations, Inc., Marshall Kragen, Washington, D.C., for Brown Transport Corp., and Edward J. Kiley, Washington, D.C., for Interstate Carriers Conference, Inc., were on the joint brief for intervenors American Trucking Associations, et al., in Nos. 83-1465, 83-1469 and 83-1479.

William P. Jackson, Jr., Arlington, Va., was on the statement in lieu of brief for intervenors Eastern Industrial Traffic League, Inc., et al., in No. 83-1490.

W. Terry Maguire, Washington, D.C., entered an appearance for intervenor American Newspaper Publishers Ass'n in No. 83-1469.

John R. Bagileo and Leo C. Franey, Washington, D.C., entered appearances for intervenor Volkswagen of America, Inc., in No. 83-1490.

William R. Power, St. Paul, Minn., entered an appearance for intervenor Burlington Northern R. Co. in No. 83-1551.

Before ROBINSON, Chief Judge, and WALD and MIKVA, Circuit Judges.


                        TABLE OF CONTENTS

                                                                 Page

   I. BACKGROUND ............................................... 1034

  II. MAXIMUM RATE EXEMPTION ................................... 1036
      A. The Commission Decision ............................... 1036
      B. Abuse of Market Power ................................. 1038
         1. The standard of review ............................. 1038...

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