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Niagara Frontier Tariff Bureau Inc. v. United States

decided: August 20, 1987.

NIAGARA FRONTIER TARIFF BUREAU, INC., PETITIONER,
v.
UNITED STATES OF AMERICA AND INTERSTATE COMMERCE COMMISSION, RESPONDENTS



Petition for review of Interstate Commerce Commission order rejecting, as violative of prohibition against collective action for establishment of single-line rates, proposed tariff supplement to increase terminal service charges.

Kearse, Miner and Mahoney, Circuit Judges.

Author: Miner

MINER, Circuit Judge:

Petitioner Niagara Frontier Tariff Bureau, Inc. ("NFTB" or "Bureau") petitions for review of an order of the Interstate Commerce Commission ("ICC" or "Commission") rejecting a proposed tariff supplement. Approved by a collective vote of NFTB members, and included as part of a larger NFTB tariff to increase commodity rates, class rates, and minimum charges, the rejected tariff supplement provided for increases in terminal service charges.

Objections to NFTB's terminal service proposal were filed with the ICC. The Commission initiated an investigation to determine whether the tariff proposal violated the statutory prohibition against collective consideration of single-line rates. See 49 U.S.C. § 10706(b)(3)(D) (1982). NFTB contended that its tariff proposal was permissible under its interpretation of the statute. The ICC, however, adhered to its prior rejection of petitioner's construction of the statute. See Niagara Frontier Tariff Bureau, Inc., 1 I.C.C.2d 317 (1984), aff'd per curiam, 251 U.S. App. D.C. 1, 780 F.2d 109 (D.C. Cir. 1986). Petitioner also argued before the ICC that the proposed tariff schedule fell within one or more of the statutory exemptions to the section 10706(b)(3)(D) prohibition. The ICC determined that none of the exemptions was applicable and rejected the proposed tariff supplement in an order dated August 1, 1986.

Because we conclude that petitioner is collaterally estopped from reasserting its statutory construction, and that the ICC's rejection of the proposed tariff supplement was based on a reasonable construction of the statute, we deny NFTB's petition for review.

I. BACKGROUND

Petitioner NFTB is one of a number of rate bureaus whose membership is composed of motor common carriers, primarily trucking firms. NFTB serves as a forum for setting, through collective agreement of its membership, the tariffs charged by its members for the transportation of general commodities. Under an agreement approved by the ICC pursuant to 49 U.S.C. § 10706(b) (1982), NFTB operates with immunity from federal antitrust laws and submits its proposed tariffs to the ICC for approval.

On November 21, 1985, NFTB filed with the Commission a proposed tariff increase, scheduled to take effect on January 6, 1986. The tariff had been approved by a collective vote of NFTB members and was designed, inter alia, to adjust commodity rates, class rates, minimum transportation charges, and terminal service charges. Terminal service charges subject to the proposed increases included charges for pickup and delivery, cargo weight verification, marking and tagging of freight, and transfer of lading from one vehicle to another. The proposed tariff would raise charges at individual terminals to match those rates charged by other bureaus; as a result, the individual increases at specific terminals varied widely.

Two organizations of shippers protested the terminal service adjustments and filed petitions with the ICC, contending that, because the tariff included single-line terminal charges, the collective fixing of the rates to be charged by each individual carrier constituted illegal anti-competitive ratemaking. See 49 U.S.C. § 10706(b)(3)(D). As defined by the ICC in prior rulings, a single-line rate is a rate charged by a single carrier completely performing the service to which the charge applies, even though other carriers may be able to provide that service.

As a result of the protests, the ICC initiated an investigation of NFTB's proposed tariff. NFTB attempted to justify the tariff by contending that the ICC's interpretation of the statutory bar to collective action on single-line ratemaking was overly broad. NFTB argued that, properly construed, the statute is inapplicable where more than one carrier offers the service in question. Alternatively, NFTB claimed that its formulation of the rates was permitted by one or more of the statutory exemptions to the prohibition against collective establishment of singleline rates. See 49 U.S.C. § 10706(b)(3)(D)(i), (iii), (iv).

The Commission found neither argument persuasive. Relying on its definition of single-line rates and on its previous rejection of NFTB's argument, see Niagara Frontier Tariff Bureau, Inc., 1 I.C.C.2d 317 (1984), aff'd per curiam, 251 U.S. App. D.C. 1, 780 F.2d 109 (D.C. Cir. 1986), the Commission concluded that the proposed tariff was barred by section 10706(b)(3)(D). The Commission also rejected NFTB's attempts to invoke the statutory exemptions.

As a result, the Commission rejected the proposed terminal service tariff by an order dated August 1, 1986. The ...


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